People who truly believe in you are those who support you matter what. In this first episode of a three part series, Ken Courtright shares one of the three different anchor moments that were very pivotal to their company, its history, and its growth to the size of a company they are today. He highlights a very important moment in his personal and business life and shows how he was able to lift himself up because of the people who believed in him. Be uplifted with Ken’s story as he reminds us to pivot when it is time to do so.
Listen to the podcast here:
Anchor Day 1
I’ve got done with another Digital Footprint. I gave a talk on the success wheel. You can look back at some of the episodes and there’s an episode there titled Success Wheel. While I was on stage going around the circle on this flip chart, it hit me that individually, in different micro components of this success wheel, we have some compelling stories as a company that I don’t know if I’ve ever shared. I’m going to do a three-part series here of three different anchor moments that were pivotal to our company, to our history and to becoming that size of a company we are today. I figured, why not throw some of these out?
I’m going to share a little bit about an important moment in my life and in our business life. I’ve got a couple of few of these are going to come out in a row on shows. We’re going to call this Anchor Day number 1, episode 125 of Today’s Growth: Growing Business Today. This is the show where I drop little nuggets that I may have learned from different industries or from life’s experience. Back in the day, in the early ‘90s, we had a consulting business, we had a sign company, but we also had a chain of video stores. Our chain of video stores quickly grew to each store creating or generating a net profit of $10,000 a month net and it was fun. We were opening stores left and right. We were borrowing money to fuel the purchase of many videos. Each VHS tape was $72 each, so you’d have to rent it 40 times at $2 to break even.Great people stand behind good people. Click To Tweet
It was an interesting time in our life. We were in our early twenties and we just began having kids. It was awesome. However, as good and as fast as it grew, it dropped ten times faster than it had grown in. I’ll never forget that there was a period of nineteen months where we were losing so much money quickly that we were selling assets in other companies just to meet payroll. I sold a crane that lifted signs up 70 feet in the air to meet payroll. I sold the biggest piece of property in Shorewood, Illinois to meet payroll. I sold a Corvette to meet payroll. I was running out of things to sell to meet payroll and after nineteen months of our three different corporate bank accounts averaging a negative $3,000 balance and never having any idea if we could buy food and if we could put gas in the car.
A year and a half went by, some of you know that my wife and I had a miscarriage. We had a sales rep who had a heart attack and died in my arms. It was an interesting time in our life to talk about forging character. I don’t wish that type of time on anybody. The bottom line is we got to a point where we realized we are going to have to sell everything related to this video enterprise. We’re going to have to sell the buildings and the shelves. We did not own the buildings. We did have to sell the lease contracts. We have to sell the inventory. Each of the stores had banks often and some had 15 to 20 TVs. There was so much to be done to go from losing $7,000 per month per store to at least cut it off. It was tough. The reason it was tough is there were still little bitty signs that we could flip over to DVD, we could flip to direct streaming media, and we could rent videos instead of buying them. There were still stories being heard across the country of individual small groups of these video stores making it and getting profitable again. The reality is we had spent millions, but we had borrowed hundreds of thousands of dollars. I had relationship capital being burnt from friends and family all the way around me, and I had to see these people every week.
Not only did I lose all their money, but it was also traumatizing. The final day was when some of the people closest to me said, “Ken, you have to stop. This is madness. Trying to fight this animal where this industry doesn’t even exist any longer is stupid.” I remember the day I said to myself, “We are going to sell everything video-related.” I remember it was painful. One of the stores, we sold the inventory to two young men in their early 30s with tons of energy. They moved it directly across the street from our store. The rent was a third of what we were paying. They were in a bigger space. They ended up getting next door to a large grocery store. We tried to get into that space, but it wasn’t available. They got the space we wanted. For about a year, it looked like they were making it and it was haunting for me.
I found out later, one day I drove by, they were gone. There was no sign. I found out that not only were they not making it, but they also were never making it. I talked to one of the employees and they said, “We were losing money from day one.” It was awful. The bottom line is we sold everything we could. We paid off whatever we could to whomever we could with a commitment that we would pay the rest of the people when we could. This was 1999. I didn’t pay the final person the final dollar until 2008. It took me nine years to continually pay a little bit here and there until finally, every aunt and uncle, every mom and dad, and everybody was paid back.
What is the lesson here? There are two of them. 100% of the main sources of income fail historically. I don’t even know of any small mom and pop video store that still around. I know a couple and mostly, all they sell is pornographic movies but the reality, I don’t know any mainstream. I know there’s a family video company still in existence. They have a number of stores, but I’m talking to the mom and pops ten stores or less. The first lesson is 100% of the main sources of income fail. End of story. It’s not, “That’s not true. My family has been in business for 85 years.” That’s fine but history is still going on. At some point, the buggy whip is going to go out of business. The horse, buggy, and carriage are going to get replaced by the cart.Live to fight another day when it's time to pivot, pivot. Click To Tweet
All I’m saying is make sure you’re keeping your options open for a 2nd, 3rd, 4th, 6th and 10th source of revenue and keep stacking S-curves. If you’re unsure of what I mean by that, episode number one, the genesis episode of this blog series is by far, my most often read episode and nothing touches it. There’s a close one how Google ranks, whatever one Google ranks is, that’s a close second. The ones with my wife and I are right up there too. The bottom line is what our company is famous for is stacking S-curves into households and onto other companies and private equity firms.
Lesson number two, people stand behind good people. I was a person of my word and I said, “I don’t know when we can pay you back, but I’m going to pay you back.” They stood behind me. They never once called me and said, “Can you pay me more?” If I couldn’t pay them that month, I doubled it up next month. Live to fight another day. When it’s time to pivot, pivot and understand that if you’re good to people, there will be good back to people and they’ll be back there the next time you need them. I hope this helps. See you on the trail. Take care.