The Frightening Benefits of Telling Everyone How Much you Make

David Nevogt is on his “third or fourth” online business, he doesn’t really remember. And it is not as if the previous companies have failed, some of those ventures hit $2 million+ in annual revenue. But in David’s words, “a lot of online companies have short life spans”. So David’s e-commerce business and fledging SEO business were eventually made obsolete by Amazon and Google’s changing algorithm. Now on his third—or fourth—David thinks this one will last, but also knows that it really doesn’t matter.

David’s current company, Hubstaff, provides tracking software for remote teams.  If you’ve got a remote team member Hubstaff will track the amount of time they worked, take random screenshots, and even measure a user’s “activity rate” to gauge how productive your workforce is. In addition, Hubstaff offers tools to help with payroll, invoicing, scheduling, and all other myriad needs of remote teams. Since being founded in 2012, Hubstaff is now doing well over $1M annual revenue.

Hubstaff decided early on to do something that very few small business do. They publish their metrics. That means that anyone can see how much money Hubstaff makes, how many users they have, and how many folks have cancelled that month. It’s definitely “a little scary”, says David, but it is part of the mission of being transparent. It helps engender trust, and get on podcasts. On the negative side, it can also inspire copy-cat businesses but David says it is all about execution.

David is an absolute zen master when it comes to productivity, digital marketing, and remote team management. In terms of tangible nuggets of advice, David is full of them in this episode. And for those who really want more, we can recommend his website

Running a Company for Two Decades

peter metcalf

Fittingly, Peter Metcalf’s interview with Patagonia founder Yvon Chouinard happened in the mountains. Chouinard was looking for someone to help with his climbing company as Patagonia took off and Peter met the job’s one key requirement — he was a climber.

He flew out to the Tetons to meet Yvon and after a few days together, Yvon wrote a German address on a piece of paper and told Peter he had to be there in September for a trade show. Without much more explanation Peter was sent on his way, knowing he had a job and left to wonder about the rest.

He’d eventually find himself running Chouinard Equipment during a tumultuous period of tort law reform in the U.S., which led to the company breaking off from Patagonia and nearly going under. Peter managed to raise the money needed to bring from the ashes what became known as Black Diamond Equipment.

For the next 25+ years Peter would lead the team at Black Diamond, taking the company public in 2010. We spoke with him shortly after he retired from daily operations.

John and I could’ve spent hours talking to Peter. In particular, I found his depth of thought on both the daily tactics and meta implications of Black Diamond to be quite striking.

You can listen to this episode on iTunes or Libsyn.

Thanks to Peter Metcalf and our sponsor MailChimp.

Allison Robicelli and the No Pants Economy

Matt and Allison Robicelli. Born, raised, and built a business in Brooklyn. Now, they're moving it all to Baltimore. 

Matt and Allison Robicelli. Born, raised, and built a business in Brooklyn. Now, they're moving it all to Baltimore. 

Allison Robicelli moves fast. The woman who got engaged only 6 weeks after meeting her husband and co-owner has opened a store in Brooklyn, closed it, grew a wholesale business, opened another store, wrote a book, closed another store, and is now building the prototype for a new franchise model in Baltimore.

            Robicelli’s bakery grew up during the Great Cupcake Movement in New York City during the 2010’s. But unlike the now-defunct Crumbs, Allison recognized the headaches involved with keeping up storefronts that only sell $4 cupcakes, and quickly transitioned her business to a wholesale business, baking top quality baked goods and selling those to restaurants and coffee shops.

            Nowadays, Allison says that they are thinking 10 years down the road and she has a few predictions for the food industry. Especially where she operates in New York City, the food industry is a challenging place. “I know restaurants where it’s a packed house every night that are lucky if they make any money at the end of the year”. Increasingly, Allison sees food moving towards the delivery model with websites like Seamless and GrubHub doing well. Not just because it is economical to move restaurant operations away from high foot traffic (read: high rent) areas, but also because of the “No Pants Incentive”. Nowadays, more and more of us can work, socialize, entertain, and now feed ourselves from behind our computer screen. Hence, the incentive to wear pants is diminishing especially when your laptop provides all the leg warmth you need. Which is also an economical way to repurpose heat energy from your laptop. But I digress…

            Robicelli’s had some really great thoughts in this one about where the food industry is going and what they are doing to adapt to that with their new franchise model in Baltimore. We think they’ll come out ahead. Why? Because we like eating cake with no pants on, that’s why. 

Saving for a Business with $40 a Day

Christopher Linton of Hoboken, NJ was an illegal alien. He came over from Trinidad with a “modified” passport in the early 1990s with no money and nowhere to go except an aunt in Hoboken, NJ. The first work he found was as a day laborer working for a flooring company and making $40 per day. He had to send some of that money home to his relatives in Trinidad and make the rest of it work living in the shadow of NYC. In the 1990s it probably didn’t cost $40 per day to park in Chris’ neighborhood like it does now, but Chris wasn’t living large. $40 per day was barely enough to buy sandwiches and a winter coat, much less set money aside for his own business.

But Chris did build a multi-million dollar flooring business over the course of the next decade. Through the 90’s, he proved his worth and raised his pay to a dizzying $80 per day. Then in 1997 after recognizing how much value he was providing to his company he got his green card and started his own flooring company. It was as if Chris was a tiger waiting to pounce. His new citizenship allowed him to take all of his experience working in the industry and build a successful business from very early on. Chris didn’t have the kind of savings to invest much in the new business, so he credits his early success with the trust that he built up with the Hoboken community. His customers knew him as the face of his old employer, and enough of them stayed loyal to Chris and his new business to keep him afloat.

The business grew organically, and in a few years Chris changed the model to how C&M operates today. C&M has the social & financial capital to capture big clients. So they bid on very large projects—think high-rises—and then contract out the work to sub-contractors, who they manage. Leveraging just their strengths allows them to run lean while still taking on the big projects.

Chris can’t complain. With a rich Trinidadian accent, he reflects. “I live good, man”. One day, Chris wants to retire and spend more time in Trinidad fishing. But for now, he loves what he does and appreciates the opportunity that he’s gotten in his neighborhood and his new country.  

Take The Risks! (That Are in Your Wheelhouse)

In 1926, Olympic champion Gertrude Ederle became the first woman to swim the English Channel. Gertrude didn’t practice the feat by wading out into the waters of France, seeing how close she could get to England, and then turning around. Gertrude’s first trans-body-of-water swim was actually across her kiddie pool (video here, promise. No idea how they got a color video of this). Presumably, she crossed larger and larger bodies of water until she finally decided that she could swim the channel. Gertrude, meet Bravado Spice:

Bravado Spice gives a big Texas “Howdy!” to Gertrude (from left, Ryan Harcourt, James Nelson, Vince Blasco, Jeremiah Tallerine)

Bravado Spice gives a big Texas “Howdy!” to Gertrude (from left, Ryan Harcourt, James Nelson, Vince Blasco, Jeremiah Tallerine)

Bravado Spice came on the show recently to talk about the risks they’ve taken. As a company, the two founders have gone from working at an Apple Store, where they gave away samples of their hot sauce to coworkers, to now being in over 300 retail stores with a thriving e-commerce site and an expanding product line. Throughout those stages, they’ve taken risks.

In the beginning, they made everyone in the company apply to be on Master Chef. Even though none were trained cooks, they felt they needed that exposure. By the time they closed a deal with Whole Foods, they quit their jobs at Apple. Nowadays, they risk larger amounts of money on new products and outreach campaigns. Along the way, the risks have been commensurate with the amount of cushion (read: capital) that the company provided them. As Jeremiah put it, “If you are a $25,000 startup, and you take a $20,000 risk, you’ve only got one shot or you’re toast”.

When I was younger, I attended the Millionaire Mind Intensive Seminar. I learned that I wasn’t a fan of seminars, too much hugging and hoo-rah. But I’ve begrudgingly had to admit that the main message rings true. The basic gist was that you could become wealthy if you thought that you could become wealthy. That made a handy tagline, but I’ve taken it to mean that if you have a small mind, you’ll take small risks. And small risks pay small rewards. If you can push beyond your comfort zone, you’ll take larger risks. And as some of those risks pan out, you can push further and further with bigger risks, which in hindsight looks like growth. What can be said for personal wealth can be applied even more neatly to growing a company. It’s why the folks who graduate summa cum laude aren’t always the ones who end up building great companies. As a company, you’ve got to be more than smart. You’ve got to venture out. Take risks. But the nuance behind that platitude is that you’ve got to have some self-awareness about where you are as a company. If you’re a kiddie company, start with the kiddie pool and grow from there.

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Thanks to James Nelson, Jeremiah Tallerine, and our sponsor MailChimp.

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