Billion Dollar Baby, Part 3: Full Disclosure
October 6, 2009
Last week, I wrote about my Billion Dollar Dream.
Now, if you have a billion dollars and are interested, you should know I am not your typical CEO.
I am not focused on how much I can stuff into my pockets and how fast. Hell, if more CEO’s were honest with their employees, CEO’s would understand (and communicate!) that they need their human resources more than their human resources need them! In reality, CEO’s really have little power over employees.
Full Disclosure: I don’t build businesses by sacrificing the long term for the short term. I am always within spitting distance when it comes to base compensation with all employees – I sort of like that “we are in this thing together” culture. Same thing with stock compensation – I would rather have a lot of people who can get rich than just me or a handful of VPs. Stock options – spitting distance again.
Full Disclosure: Building a great business motivates me. Watching employees take on responsibility and make good decisions is exciting. It’s fun to create an environment of unconditional trust–one that is wrapped around work that people enjoy, with the “value-delivery message” of reliability…one that customers and employees, if taken care of properly and with priority, will benefit shareowners handsomely. The shareowner supplies money – the rest is up to customers and employees executing upon trust and shared-knowledge.
Full Disclosure: Regarding my management style–I do have a different method than most. Amongst the management team, if there remains alignment difference in strategy, culture or execution–if, after reasonable debate and having agreed upon a direction of execution…after a reasonable amount of time–I will make adjustments to insure focus and alignment. I have done this effectively over the years. I fire people. I don’t fire the employees–after all, they are getting direction from someone. I will fire Executives. This has proven to work effectively. For me, cutting the head off a problem is the fastest way to get alignment. If a rogue leader says one thing in a staff meeting and does another thing outside the meeting, getting rid of him/her is what works. I have patience. I am not Attila the Hun. But when we agree on a direction, we must 100% agree upon executing to the plan. We will adjust the plan when needed but going rogue and creating an “us and them” environment … zero tolerance.
Full Disclosure: On “deal” making, aka M&A, at one time…I have been told by a Real Smart Guy (RSG) that I am not a “deal maker.” Translated: I am not out to just screw other people.I do not have the “I am slicker than you” mentality. As I often have said, “the softest pillow is a clear conscience”. We have done three acquisitions or “deals” at AFS–all highly accretive, all profitable within 60-90 days post close. I have lost or walked away from a lot of “deals.” Deals? M&A is about knowing what to buy, when to buy, how to buy, and the risk of success long before you set an offer price/terms.
It is not a spreadsheet exercise. The cornerstones of any “deal” are the people/culture that comes with a “deal” which will determine long term value. Most “deals” the real value is locked inside the heads of your new employees – not my brilliance or the brilliance of a RSG deal maker. Statistics have shown, most M&A deals fail … sure, we only did three–but my team is batting 1000.
The value of a “deal” can go beyond the lemming mentality of common multiples – M&A is often two edged. The worst “deal makers” are those that have money burning a hole in their pocket … no time to select and pay for the finest of wine with aging ability. Buy a case of Ripple, layoff the factory and issue a press release … gun and run … forgetting there is the going “value” and future value. No two deals are alike, though an Investment Banker will rely on common data of multiples as long as there is an outcome with an accompanying fee! If you know your industry, your customers, your competition, your team – you know value goes beyond the multiples of EBITDA spreadsheet jockey analysis.
So, if you have a billion dollars, please contact me. I am not going to change. Personal responsibility and accountability has been driven into me since I was a kid. I don’t follow the herd, I just like to pick off the choice Bison based upon what arrows I have in my quiver. And as an added bonus, I don’t lie or word parse to investors, debt holders, Board Directors, employees or customers. You can’t really be a team – investors, debt holders, Board Directors, employees, customers – if the CEO bends the truth. Some on the darker side of business may view this attribute as a weakness. I happen to like not having to keep track of what lies or parsing I have told someone – it makes execution and achieving results easier. Plus it makes that pillow much softer when I go to bed at night also.
Boy that Telecom Alley reunion was fun.
Anyone else out there with a billion dollars and a dream?
Written by Dave Rusin - Telecom Executive
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Sorry, but I don’t have a billion dollars. However, I did enjoy reading about your business operating philosophy. What a breath of fresh air in a time of corruption overload!
Should you ever open an operating division in Chicago, please let me know. Would love to work for the company!
Very refreshing monologue. I totally agree with the old cliche People do make a difference (good/bad). Three basic traits are key – Customer(internal/external) Make money(without I can not have a team) Have FUN.