Inc. Magazine 2013-11

Exit Rich: Inside the sale of an Inc.
5000 rm
page 104
WHAT
YOUR EMPLOYEES
REALLY THINK
JASON FRIED
page 110
The Magazine for Growing Companies
29
Nick Woodman
How to inspire
crazy loyalty
Neil Blumenthal
How to manage
Millennials
Tim Ferriss
How to ace a
keynote speech
skills
every
founder
needs to
master
Gary Vaynerchuk
How to get
Facebook
right
Jenn Hyman
How to
elicit honest
feedback
Johnny Earle
How to stage
a splashy
opening
Gary Vaynerchuk
The hardestworking man in
social media
Alexa von Tobel
How to spend
smarter
page 44
Scott Adams
How to be
funny at
the ofce
THE TOP
JOB CREATORS
IN AMERICA
page 26
BONUS SECTION
How to unite your team behind you

after page 112
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Your business succeeds

when you take care
of your people.
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We succeed
when we take care
of you.
You want to focus on the health of your company. Let us focus on the health of your employees.
We offer health care solutions that are designed to help t your budget. And employee resources
that act like an extra set of hands. Because at UnitedHealthcare, we know a healthy workforce
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UnitedHealth Group ranked #1 by FORTUNE magazine for innovation1 including the
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Ranked #1 by the American Medical Association in claims processing accuracy 2
A cost estimator tool that allows members to compare doctors and costs
before scheduling an appointment
Flexible plans designed for different sized business
Solutions to help manage health care costs
Stepping up for better health care

See how at uhc.com/stepup
FORTUNE Magazine ranked UnitedHealth Group #1 in innovation among the insurance and managed care sector. FORTUNE Magazine, March18,
2013.FORTUNE is a registered trademark of Time, Inc. FORTUNE and Time Inc. are not afliated with, and do not endorse products or services
of,UnitedHealth Group.
American Medical Association, 2012 National Health Insurer Report Card survey.
2013 United HealthCare Services, Inc. Insurance coverage provided by or through UnitedHealthcare Insurance Company or its afliates. Administrative
services provided by United HealthCare Services, Inc. or their afliates. Health Plan coverage provided by or through a UnitedHealthcare company.
UHCEW655518-000
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Dell recommends Windows.
Meet our overachieving

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What we
needed was
a home run.
jeff kadlic,
co-founder of evolution
Partners. The private
equity rm bought an
inc. 5000 company, took
it to the next level, then
invited Inc. to watch the
rm negotiate a sale.
pg.
photograph by Steven Laxton
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104
November 2013 - inc. - 5

solutions
Turn to the Lead
section for insights
from some of the
most successful
entrepreneurs
operating today.
See page 44.
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78
made
Best in Class
The best gifts are
ones made with
passion and pride.
You know whos pretty
good at that? Here are
four extraordinary
entrepreneur-made
products, in time for
holiday shopping.
104
innovate
Anatomy of a Deal
Features
26
the 2013 Hire

Power Awards
44
launch
Inc.s salute to the fastgrowing private companies

that are creating jobsmore
than 50,000 of them in the
past year and a half
lead
the Know-how Report

We asked two dozen accomplished entrepreneurs for their best stuf: their insights
about leading, inspiring, growing, and
generally getting stuf done. the result is a
16-page peer-to-peer guide to what works.
As told to Leigh Buchanan, Tom Foster, Burt Helm, and Issie Lapowsky
on The cover gArY vAYnercHuk, ceO Of vAYnerMedIA, pHOTOgrApHed In neW YOrk cITY BY jAke cHessuM
6 - inc. - nOveMBer 2013
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contents
THIs pAge: BrIAn kluTcH/geTTY

cOver: sTYlIng: MIcHAel fIsHer AT sTArWOrksgrOup; grOOMIng: cArMel BIAncO AT rAY BrOWn
A private equity rm ofered Inc. a

look inside the sale of an Inc. 5000
company. We expected brinkmanship, twists and turns, and whiteknuckle tension. We were not
disappointed.
By Jeremy Quittner
WFC
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Work From Caf
The power to make informed business decisions

now follows you everywhere. Because youre
securely connected to your back oce you can
make the sale, send the invoice, and see how
it all adds up. Why wait?
Go to: WorkFromSage.com
2013 Sage Software, Inc. and its aliated entities. All rights reserved.
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20
96
14 Editors Letter
Creating jobs; sharing wisdom
140 Founders Forum
Scott Belsky of Behance
19
launch
90
Departments
140
20 Tip Sheet Dont fear competition.

It may just be the best thing for
your business.
22 Owners Manual Dharmesh Shah,
the marketing guru who says
marketing isnt necessarily the answer
36 Inc. 5000 Insights Lessons on
disrupting a staid industry from an
innovative building company
40 Eric Paley Sometimes, the best advice
is obvious. That doesnt make it wrong.
43
lead
44 Special Know-how Section Our 16-page

peer-to-peer guide to what works
68 Norm Brodsky Its when you succeed
that the biggest challenges arise.
71
72 Tip Sheet Turning customers into designers

74 How to Boost Small Manufacturing
Two steps the U.S. government can take now
76 Factory Makeover An inside look at
Filsons new production facility in Seattle
86 Mark Dwight How to make sustainability
a core value
89
innovate
90 Tip Sheet Pictures speak louder than

words on social media. Are you saying
the right things?
92 Disrupter HealthTap brings the doctors
ofce to patients smartphones.
96 Creative Culture You failed?
Congratulations!
98 How I Did It Former Van Halen frontman
Sammy Hagar is a serial entrepreneur
who doesnt stray far from his roots.
110 Jason Fried Is your door really
always open?
AFTEr PAgE 112, SPECIAL BONuS SECTION Eight great ideas to make sure your senior management team is united behind your strategy
8 - inc. - NOVEmBEr 2013
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contents
CLOCkwISE FrOm TOP LEFT: DAVID STEwArT; mArIO ZUCCA; kELSEY mcCLELLAN/COUrTESY jENIS SPLENDID ICE CrEAmS; DANIEL SEUNg LEE
made
INTRODUCING
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TOP
I N C .C O M / P E O P L E
4 Tips for Hosting a Hackathon

No longer just for tech start-ups, hackathons
are a great way for any company to spur innovation and bring employees together. Warby
Parker co-CEO Neil Blumenthal shares his tips
for hosting a companywide throwdown.
Inc.com
VIDEOS
on Inc.com
I N C .C O M / I N C - L I V E
Esther Dyson
Start-up investor
ON HIRING
The hardest thing

for a start-up
these days is not
finding money. Its
finding a team.
MAKE EVERYONE
WELCOME
LET GROUPS FORM

ORGANICALLY
KEEP EVERYONE
WELL FED
AWARD PRIZES
Open the hackathon to anyone who wants

infrom interns
to senior executives. Each
brings a unique
perspective.
Dont assign
groups. Instead,
encourage
employees to
form their own
based around
similar ideas.
These competitions traditionally revolve

around pizza,
energy drinks,
and candy,
but ofering
healthier
options is also
a good idea.
Hackathons are
exhausting.
Reward each
teams efort
by doling out
prizes for innovation, originality, and other
categories.
Go Beyond the Page
I N C .C O M / I N C - L I V E
John Mackey
Co-founder of Whole Foods
ON SOCIAL ENTREPRENEURSHIP
Every business
has the potential
for a higher purpose besides just
making money.
ADAM VOORHES/GALLERY STOCK
Youll nd the icon at the left on selected pages throughout

the issue. Thats your signal to grab your smartphone or tablet
and go deeper with the content on the page. Heres how:
1. Download the free Layar app from the Apple or Android store or at layar.com.
2. Launch the app and scan any page carrying the icon.
3. Enjoy bonus videos and other content designed to enrich the story.
10 - INC. - NOVEMBER 2013
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CONTENTS
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A more efficient supply chain
makes me happy.
UPS makes me happy.
Jack Roush
Chairman, Roush Enterprises
When Jack Roush wanted to take the kind of performance
engineering he puts into his engines and build it into his entire
company he only made one callto UPS. By consolidating
all of his freight, package, air, tracking, billing and reporting,
Jack saved a tremendous amount of time and money.
How does he manage it all? With UPS WorldShipthe carriersupplied software that lets companies process and track their
package, air freight and LTL shipments in a single system.
Find out how logistics solutions from UPS make CEOs like
Jack Roush happy at ups.com/happy.
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Copyright 2013 United Parcel Service of America, Inc.
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PResiDeNT RobeRT lapoinTe
eDiTOR eRiC sChuRenbeRg
DePUTy eDiTOR dan FeRRaRa DePUTy eDiTOR, iNC.COM allison Fass

eXeCUTive eDiTOR laRRy KanTeR
ARTiCles eDiTOR bobbie gossage seNiOR eDiTORs lindsay blaKely, nadine heinTZ
sTAff eDiTOR Kasey wehRuM AssOCiATe eDiTOR Jill KRasny
sAN fRANCisCO bUReAU Chief niCole CaRTeR
eDiTORs-AT-lARGe will bouRne, leigh buChanan, bo buRlinghaM, ToM FosTeR, KiMbeRly weisul
seNiOR wRiTeRs buRT helM, ChRisTine lagoRio-ChaFKin
sTAff wRiTeRs issie lapowsKy, eRiC MaRKowiTZ, JeReMy quiTTneR RePORTeRs abigail TRaCy, will yaKowiCZ
CReATive DiReCTOR blaKe TayloR
PhOTOGRAPhy DiReCTOR TRavis Ruse
ART DiReCTORs saRah gaRCea, KRisTin lenZ
DePUTy PhOTO eDiTOR heidi hoFFMan AssisTANT PhOTO eDiTOR MoniCa siwieC PhOTO eDiTOR, iNC.COM Joel FRoude
viDeO eDiTOR andRew MaClean viDeO PRODUCeR TiM RiCe
AssisTANT MANAGiNG eDiTOR JaniCe MalKoTsis
COPy Chief peTeR J. Mclaughlin COPy eDiTOR paM waRRen
PRODUCTiON DiReCTOR RaChel MosKoviTZ-abRahaM PRODUCTiON AssOCiATe doMiniCK sanTise
seNiOR CONTRibUTiNG eDiTOR noRM bRodsKy
CONTRibUTiNG eDiTORs adaM baeR, JeFF bailey, John bRandon, daRRen dahl, MaRK dwighT, donna Fenn,
david h. FReedMan, Jason FRied, JeFF haden, bill haRRis, Meg Cadoux hiRshbeRg, eRiC paley, liZ welCh
iNTeRNs FRanCesCa louise FenZi, RoMKe hoogwaeRTs
The bUilD NeTwORK
eXeCUTive eDiTOR sCoTT leibs DiReCTOR Of PROjeCT DevelOPMeNT AND web DiReCTOR anni layne RodgeRs ART DiReCTOR ashley bond obRion
Chief wRiTeR ilan MoChaRi web PRODUCeR AND wRiTeR adaM vaCCaRo eCONOMisT-iN-ResiDeNCe gaRy KunKle
GROUP PUblisheR, iNTeGRATeD MARKeTiNG John M. Tebeau
CATeGORy DevelOPMeNT DiReCTOR Reg ungbeRg
sAles MANAGeR KeRi haMMeR
New yORK ChRis andRews, dan hoRowiTZ, aniTa pai: 212-389-5300
seNiOR ADvisOR iRvin v. FalK
fRANChise seCTiON MANAGeR david desiMone
ATlANTA loReTTa andeRson, MaRK andeRson: 404-264-8989
ChiCAGO JaCK CaRson, sTeven newMan: 312-494-1919
DAllAs sTeven g. TieRney: 972-625-6688
DeTROiT geoRge walTeR: 248-205-3900
lOs ANGeles/sOUTheRN CAlifORNiA heaTheR MClaughlin,
RiChaRd l. Taw iii: 310-341-2341
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fRANChise AND MARKeTPlACe ToM eMeRson: 212-655-5220
inc. live
DiReCTOR, sTRATeGiC PARTNeRshiPs AND eveNTs lynn shaFFeR

seNiOR eveNT PRODUCeR Tennille M. Robinson
MANAGeR, TAleNT AND CONTeNT DevelOPMeNT JusTin a. deFReeCe
eveNTs COORDiNATOR shannon byRd
business resources
DiReCTOR, CONTeNT DevelOPMeNT Jon Feld

sAles DevelOPMeNT DiReCTOR JenniFeR henKus
iNTeGRATeD MARKeTiNG MANAGeRs neil Jones, MaRy MooRe
ACCOUNT DiReCTOR daRCy lewis
seNiOR ACCOUNT MANAGeRs billie gibson, KyRa shapuRJi
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sAles AND MARKeTiNG COORDiNATOR eRinn noRTon
GROUP viCe PResiDeNT, MARKeTiNG paTRiCK hainaulT
eveNTs MARKeTiNG MANAGeR MaRCie RosensToCK
AssOCiATe MARKeTiNG MANAGeR linda lau
DesiGN MANAGeR hoJoon Jon
DesiGNeR Myung-hun Jin
ReseARCh MANAGeR ben ohaRa
production
GROUP DiReCTOR KaThleen oleaRy

ADveRTisiNG OPeRATiONs MANAGeR sung woon Kil
GROUP MANAGeR Jane haZel
fiNANCe MANAGeR bob bRonZo
AssOCiATe MANAGeR dave powell
consumer marketing
DiReCTOR anne MaRie oKeeFe

CiRCUlATiON OPeRATiONs DiReCTOR doug sMiTh
seNiOR MANAGeRs TyleR adaMs, KaThRyn C. KMioTeK
MANAGeR MiChelle TRigosso
d i g i ta l
GROUP PUblisheR, DiGiTAl whelan Mahoney

seNiOR ACCOUNT eXeCUTive aMy ChRisTiansen
DiGiTAl PROjeCT MANAGeR/ANAlysT young-John Tung
GROUP DiReCTOR, DiGiTAl DevelOPMeNT Jason Tagg
DesiGN DiReCTOR haewon Kye seNiOR ART DiReCTOR JaneT waegel
seNiOR DevelOPeR John guaRagno
DevelOPeRs sean ConneR, shashanK KodupuganTi
PRODUCTiON DesiGN sPeCiAlisT adaM Kelly
d i g i ta l m e d i a a n d o p e r at i o n s
GROUP DiReCTOR sTeven suThiana

seNiOR MANAGeR, bUsiNess OPeRATiONs Jonelle MaRino lasala
seNiOR COORDiNATOR, bUsiNess OPeRATiONs selin eRdinC
COORDiNATOR, ANAlyTiCs AND bUsiNess OPeRATiONs williaM won
seNiOR MANAGeR, ReveNUe OPeRATiONs david vasqueZ
COORDiNATOR, ReveNUe OPeRATiONs ChRisTina Chin
AssOCiATes, ReveNUe OPeRATiONs Rian Rooney, JaMes van sweRingen
CONsUlTANT david RosenbauM
accounting
CONTROlleR eve pai

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sTAff ACCOUNTANT shaRiTa neveRson
ACCOUNTs PAyAble MANAGeR MaRilou oRdillas
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mansueto ventures llc
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welcome
Doing Your Job,

Creating Jobs
s I wrIte, economists are still glowing
about this mornings jobless claims

report, which showed that fewer
workers led for unemployment last
week than at any time since June
2007. Stocks rallied on the news,
and predictions of a coming spurt in
hiring began to echo through the
Twittersphere. Although nothing in this fragile recovery
is guaranteed (are you listening, Congress?), optimism
about job growth is, for now, running encouragingly high.
14 - inc. - November 2013
stretch. You can meet the founders of some of these companies in

the feature that starts on page 26;
the complete list lives on Inc.com.
companies that grow and
create jobs require leaders who
actually know how to do their
jobs. That brings us to this
months cover story, which starts
on page 44 and lls our entire
lead section. Under the guidance
of deputy editor Dan Ferrara, a
team of Inc. writers approached
the smartest founders we could
think ofstarting with our cover
subject, the hyperactive and
compulsively helpful Gary
Vaynerchuk of Vaynermediaand
asked, what practices got you
where you are today? as well as
what are you best at? and
what have you gured out that
other entrepreneurs ought to
know? The result, in my opinion,
is Inc. at its bestpassing practical know-how and, sometimes,
real wisdom from the entrepreneurs on the page to other entrepreneurs like you.
Theres one other feature that
Im particularly proud of in this
months issue: a special bonus

section created by my colleagues
at Inc.s sister publication, Build.
Builds editors are expert at zeroing in on the smartest leadership
and management ideas now in
circulation and distilling them
into amazingly useful, jampacked one- and two-page stories.
The Build insert starts after page
112. I think youll nd it addictive.
let me know if Im right.
eric schurenberg erics@inc.com
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editors letter
christopher sturmaN
All of which makes this

the ideal moment to honor
the companies that make job
growth possible.
Inc.s second annual Hire
Power Awards does just that.
Though much nonsense has
been promulgated about the
identity of Americas job creators, the research is clear:
most net new jobsthat is, jobs
created in excess of those destroyed by layofs and business
failurecome from the fastgrowing companies that always
have been at the heart of Inc.s
mission. (For the denitive story
on job creation, check out who
Really creates the Jobs? by
editor-at-large Bo Burlingham,
on Inc.com.)
classic Inc. growth companies
dominate this years Hire Power
rankings, including the homefurnishings store wayfair, jewelry
maker Alex and Ani, and eyewear
retailer warby Parker. The top
100 Hire Power honorees alone
created 51,327 jobs in the past 18
months, more job growth than 32
states recorded over the same
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PA RT n E R P E R S P E C T I V E / U n I T E D A I R L I n E S
Air on the Side of Success:

The Art of Connecting
CAse study: SalientMG
The Global Pursuit of

the Human Connection
s founder, managing partner,

and CEO of SalientMG,
Erin Mack Mckelvey Prince
ies all over the world helping her

clients nd their key source of industry dierentiation. SalientMG team
members expect to log more than
150,000 miles of air travel in 2013 in
pursuit of the kind of face-to-face
interaction and human connection
that is critical to the success of their
business. United Airlines is my
connection point to my clients from
Helsinki to L.A. and everywhere in
between, she says.
From London to
Vienna to Barcelona to
Singapore, United has
enabled me to conduct
global business.
McKelvey Prince and her partners,

Lisa First Willis and Shannon Chatlos, email, Skype, and talk regularly
with their clients, but there is just no
substitute for a face-to-face meeting.
We engage with other CEOs,
CMOs, and heads of business who
they have incredibly complex jobs
and schedules, and with the speed of
our mobile lives, they need real-time
interaction and decisions, she says.
Getting to know our clients, their
culture, and their market cannot
happen over the phone. When
discussing high-level business strategy, product launches, and market
shifts, there is a trust that is continuously formed through personal
interaction. Healthy debates, opportunity review, and counsel is
nearly always more eective when
conducted in person, she says.
WorldMags.net
McKelvey Princes airline of choice

for almost two decades has been
United, making it possible at one
point for her to live in Maryland and
commute to her job in Mountain
View, California for three years. As
her career horizons have broadened,
United has become her global airline
as well, she says. From London to
Vienna to Barcelona to Singapore,
United has enabled me to conduct
global business. And when United
isnt available in a given geography, a
partner in the Star Alliance is.
With hubs in many of the cities
SalientMGs principals frequent and
an extensive choice of ights, United
makes travel to and from the companys home base in Laurel, Marylandvia Washingtons Dulles
International Airporteasy. Amenities like global WiFi and the United
Club are added bonuses. Weve met
several potential clients, partners,
and analysts on ights and in the
United Club on various business
trips. We look at the travel experience as an opportunity to meet
fellow business travelers who may or
may not be in our target industry,
McKelvey Prince says. But she is
most impressed with Uniteds customer service and the sta who
provide it. Tey are great at what
they do. Tey are quite engaged via
social media and have been helpful
rebooking me in real time.
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CAse study: Saddleback leather co.
Face-to-Face Frequency
Drives Innovation
s origin stories go, its hard to

nd a more interesting one
than Saddleback Leather
Companys. Among its notable aspects
are a bullghting ring, the Mexican
maa, a dog named Blue, and a
crooked Federale who may or may not
have been hired to assassinate the
company founder. But the most
important part of that story is the
human connection founder Dave
Munson established with a gnarled old
leather worker who was able to produce
the perfect leather bag Munson had
been creating and rening in his mind
for many years. Since then, the kind of
human connection that can only take
place with face-to-face interaction has
played an important part in Saddleback
Leathers success, and United Airlines
helps make that possible.
Headquartered in San Antonio, Texas,
Saddleback Leather is a virtual enterprise with key employees scattered
across the country, its main manufacturing facility in Mexico, and vendors
around the world. Te company relies
on technology to help maintain a
tight-knit sense of family on a day-today basis, but it has found that nothing else is as eective at fostering
creativity and innovative thinking as
face-to-face interaction. So every six
weeks its key people y United Airlines from half a dozen states to San
Antonio and spend four days together
in the same place, sharing meals and
down time and getting a chance to

connect beyond work.
Weve found that its in those conversations that we come up with some of
our best ideas, says John Bergquist,
Saddleback Leathers Relationship
Guy (his actual title). Since 60
percent of what a person says is not
verbal, and we have a very strong group
of innovative thinkers who verbally
process ideas, its the face-to-face times
when we come up with our best and
most creative ideas and solutions.
Besides those leadership meetings,
founder Munson and his wife Suzette
maintain relationships all over the
world, and travel is a big part of their
lifestyle. For most of our destinations, we can choose from many
airlines, but United is our airline of
choice, Bergquist says. Recently, I
missed my connection to Portland
because of severe weather delays. Te
entire airport was in chaos, but I was
able to reach out to United through
Twitter and get instant help. Stellar
customer service is a core value at
Saddleback, and when we experience
that with another company, like
United, it makes a big dierence.
The company relies

on technology to
help maintain a
tight-knit sense of
family on a day-today basis, but it has
found that nothing
else is as effective at
fostering creativity
and innovative
thinking as face-toface interaction.
For more information, go to united.com/yerfriendly
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Payroll doesnt have to be so frustrating.

Unless you like the extra ber in your diet.
Payroll stressing you out? Start using Intuit Payroll and make it easy
on yourself. With a few clicks you can pay employees and file tax
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Online Demo
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From Day One, our

plan was to become
the worlds premier
language-services
company.
HIRE POWER
HONOREE LIZ ELTING,
whose company,
TransPerfect, has added
489 new jobs
28
26
PG.
PG.
THE 2013 HIRE

POWER AWARDS
36
PG.
FOUR WAYS TO
SHAKE UP YOUR
INDUSTRY
PHOTOGRAPH BY ERIN PATRICE OBRIEN
WorldMags.net
NOVEMBER 2013 - INC. - 19
The only problem with Microsoft is

Winning, atWorldMags.net
Any Cost
Competition may be good for
business, but it doesnt always
bring out the best in people.
A few cases in point.
they just have no taste. I have no

problem with their success. I have
a problem with the fact that they
make really third-rate products.
STEVE JOBS
THE MORE
COMPETITORS,
THE BETTER
It isnt fun, but competition
may be the best thing to
happen to your start-up
AFTER INVESTING $5 BILLION to develop a
range of hybrid and electric vehicles,
Nissan-Renault claimed the title of the
leading manufacturer of zero-emission
cars. CEO Carlos Ghosn has found that it
can be lonely at the top. Speaking at the
Frankfurt motor show earlier this year,
Ghosn said he welcomes competition
from other automakers because a bigger
eld would help jump-start the market.
The more companies that buy into
electric cars, the better it is, he said.
If competition is good for a billiondollar automaker, why not for your
start-up? Although most entrepreneurs
dream of having a market all to themselves, research shows that youre
probably better of with some company.
Professor Michael Porter of Harvard
Business School has written extensively about industry clusters and has
shown the benets that competition
brings to similar businesses within
an industry.
If nobody is competing in your
space, theres a very good chance the
market youre going into is too small,
says Ben Yoskowitz, an angel investor

and founding partner at Year One Labs,
a start-up accelerator in Montreal. Any
reasonably good idea has 10,000 people
working on it right now. You may not
even know they exist because theyre as
small as you.
James Park, co-founder and CEO
of Fitbit, is well aware of his competition. His company, which makes a
wireless tracker that lets users monitor
their physical activity, competes against
similar devices made by Nike and
Jawbone. Those big brands, Park says,
have actually helped his business by
lending it an air of credibility and generating some buzz in the press. More
players in the market implies that
wearable tech is a mainstream activity
and that consumers should be comfortable adopting it, Park says. You
need some critical mass to legitimize
what youre doing.

Brad Feld, managing director at the
Foundry Group, a Boulder, Colorado
based VC rm, has some rather cryptic
advice for start-ups worried about
competition: Be obsessively focused
on your competitors while ignoring
them. In other words, know your
rivals products, market positioning,
and nancial status, and how they
engage users, but dont constantly react
to every move they make.
Nor should you be deterred from
entering a market that already has
some competitors. I dont think a
market is ever too crowded, Feld says.
That is, of course, as long as your product isnt just another me too ofering.
Most start-ups are competing with the
status quo, says Feld. Instead, build a
company that does something unique.
Apoorva Mehta hopes to do that
with Instacart, the San Francisco
based same-day grocery delivery ser-
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ILLUSTRATION: MARIO ZUCCA; SPREAD: FROM LEFT: GETTY (2); AP
Tip Sheet
No. 1, cash is king.

If any of my
WorldMags.net
No. 2, communicate.
competitors were
No. 3, buy or bury
the competition.
drowning, Id stick a
hose in their mouth
and turn on the water.
JACK WELCH
RAY KROC
ASK NORM:
HOW TO BE A DAVID
IN AN INDUSTRY
OF GOLIATHS
Senior contributing editor
Norm Brodsky tackles your
start-up questions
Dear Norm,
Our year-old start-up is a monthly
nail-polish subscription service that
donates 30 percent of its prots to
charity. Our competitors are very
large nail-polish companies that
have an extensive network of
brick-and-mortar outlets and huge
advertising budgets. They can ship
globally. We dont know how to.
They have ways to achieve international brand recognition. We
cant begin to match it. How can
we compete?
GEORGE CUEVAS, SquareHue, Miami
vice he founded in 2012. A former

Amazon engineer, he now competes
against his previous employer and a
handful of other companies that ofer a
similar service. Instacart diferentiates
itself by using personal shoppers to
pick up a customers groceries from
multiple stores and deliver them in
about an hour. Competition has shown
us theres a demand for our services,
Mehta says. Our product is faster, and
we have more selection than Amazon
or PeaPod. Competition combined with
having a better product means were
going to succeed. A little cockiness
never hurts, either. JILL KRASNY
When you have limited resources,

you need to be extracareful to use
them wisely. SquareHue is a collaborative venture of three couples
six individualsall of whom have
full-time jobs. So they have limited
time and money. They shouldnt
waste either one guring out how
to sell internationally, which raises
issues they dont need to think
about now. Thats actually the only
problem with having competition
from much larger companies: It
sometimes leads you to focus on
the wrong things.
In talking to George Cuevas, it
was clear that he and his ve
partners are in business primarily to
raise money for charity. They are all
members of a church that four of
them work for. So I urged them to
focus on the advantages they have
but arent currently using. For
example, they had helped stage a
church conference for 8,000 people
focused on charitable giving. Maybe
they can do the same thing with
other churches around the country
and use the events to raise brand
awareness. They can also look for
alliances with other businesses that
have a charitable focus. I suggested
they map out a plan, with specic
goals, for the next year or two, and
focus on taking advantage of their
unique strengths.
Got a question for Norm? Send it to

asknorm@inc.com.
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LAUNCH
WorldMags.net
O W N E R S M A N UA L
repeat after me:

the customer is
aLways human
HubSpot co-founder Dharmesh Shah recently

did something unsettling. Hes a self-described
evangelist for inbound marketing, or the idea
that you use content to pull in customers, rather
than ads that push them away. But in front of
5,000 employees and customers, he declared,
Inbound marketing is not the answer. Shah
tells Inc.s Jef Haden why, as the balance of information power shifts more toward the consumer,
the best strategy is to solve for humans.
Photograph by adaM detour
Why is inbound marketing not

the answer? Youve built a big
business on just that.
Imagine you want to buy
something. You nd an incredibly helpful e-book or video, so
you reach out to the company
that produced it (a perfect
example of the power of
inbound marketing). Unfortunately, your experience with
the sales team is miserable.
Now, you dont ever think,
The sales experience was
awful, but I dont mind because their marketing was so
awesome! A mediocre sales
experience far outweighs
even extraordinary inbound
marketing experiences.
22 - inc. - noVeMber 2013
But every company claims to

already do that. Most brand
statements say some version
of, We put people rst.
Brand was once the perception people have of your company. But brand no longer
lives just in the minds of
humansit also lives inside
algorithms. For example, the
Google algorithm predicts
whether a given webpage
contains quality content, so
your success depends partly
on Googles algorithmic
assessment of your brand.
What does that mean for
the future of brands?
In the future, you wont just

hit Ignore when you get an
annoying sales call; youll
also be able to down-vote
that phone number. Someday,
we wont just see caller ID
on our phones but also caller
reputation. As new tools are
developed, algorithms will do
a much better job of evaluating a brand than an individual
can, because algorithms will
be based on thousands of
data reactions.
In short, harnessing the
power of consumer advocacy
is the answer.
A delighted B2B customer is
a long-term customer: He will
tell friends and colleagues
(boosting your algorithmic
brand), and if he leaves his
job, hell take your business
with him. But forget about
Customer Lifetime Value.
Person Lifetime Value matters
most. Humans dont buy
from companies; humans
buy from humans, so solving
for humans is every smart
companys primary goal.
WorldMags.net
So the process cant begin

and end with your marketing.
Many companies have forgotten they sell to actual people.
Humans care about the entire
experience, not just marketing
or sales or service. To really
win in the modern age, you
must solve for humans. Every
process should be optimized
for what is best for the customernot your organization.
Shahs rules
for solving
for humans:
HuManS dISlIke
InterruptIon.
People hate ads
especially pop-ups
when theyre trying to
do something else. Its
an irritating experience,
and irritated people
wont buy from you.
HuManS poWer
algorItHMS.
Vocal customers will
increasingly power
the algorithms that
determine the
perceptionand
successof your
business. Pay attention
to what they say and
where they say it.
HuManS dont
juSt care aBout
what You Sell.
They also care how you
sell it. Most buyers are
halfway through the
buying process before
talking to you. Give them
the info they need so
they can sell themselves.
HuManS crave a
total experIence.
Marketing, sales, service,
delivery, follow-upyou
need to deliver a whole
package that caters to
the customer.
Launch
WorldMags.net
Is your company
prepared for the
changing health
care landscape?
Only 21% of
companies are
extremely or
very prepared to
address changes
coming to our
health care
system in 2014.*
How will you be prepared?

Call your local Aac ofce or download our Employers Guide:
aac.com/HCRGuide
Z130889B
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*Source:
2013 Aac WorkForces Report
9/13
WorldMags.net
Powering Americas
Workforce
Bank of America Merrill Lynch is the marketing name for the global banking and global markets businesses of Bank of America Corporation. Lending, derivatives, and other commercial
banking activities are performed globally by banking affiliates of Bank of America Corporation, including Bank of America, N.A., member FDIC. Securities, strategic advisory, and other investment
banking activities are performed globally by investment banking affiliates of Bank of America Corporation (Investment Banking Affiliates), including, in the United States, Merrill Lynch, Pierce,
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A strong economy starts with standout businesses.

Congratulations to this years Inc. Hire Power honorees.
Bank of America Merrill Lynch is proud to sponsor
these important awards, and to provide powerful
human and financial capital that keeps companies
moving forward.
Fenner & Smith Incorporated and Merrill Lynch Professional Clearing Corp., all of which are registered broker dealers and members of FINRA and SIPC, and, in other jurisdictions, by locally registered
entities. Merrill Lynch, Pierce, Fenner & Smith Incorporated and Merrill Lynch Professional Clearing Corp. are registered as futures commission merchants with the CFTC and are members of the NFA.
Investment products offered by Investment Banking Affiliates: Are Not FDIC Insured May Lose Value Are Not Bank Guaranteed. 2013 Bank of America Corporation
08-13-0679
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Thats the number of jobs createdin just

18 monthsby this years Hire Power Awards
honorees. Its an impressive number, produced
WorldMags.net
WorldMags.net
by an even more impressive crop of companies.

Meet the fast-growing businesses that are putting people
to work and keeping the economy moving forward
WorldMags.net
LAUNCH
ast-growth
businesses and
great employees
are a natural pairits hard to
have one without the other. The
100 companies on this years
Hire Power list (a full version of
which can be found on Inc.com)
employ 141,270 peopleand
added 51,327 jobs in the past
18 months. Some of them
including Warby Parker and
Wayfairare new-economy
icons; others are still under the
radar. Whatever the companies
level of renown, their leaders
are serious about the task of
hiringrecruiting, training,
developing, and just plain caring
for their new hires. In the
following pages, you will meet
three companies whose leaders
have found distinctive ways to
do all of the above. Youll also
nd the ranking of the top 25
Hire Power honorees. For the
second year in a row, the topranked company is Universal
Services of America, a janitorial
services and security company
that added 14,240 people to
its payroll. When we say that
private growth companies are
the heroes of the U.S. economy,
that is what were talking about.
ILLUSTRATION BY JORDAN METCALF
WorldMags.net
TRANSPERFECT
NO.19
When
Going to
Work Is
Like Going
to School
For new hires at

TransPerfect, the
learning never stops
TRANSPERFECT specializes in
helping clients bridge communication barriers, but that

doesnt mean it never faces
any of its own. The New York
Citybased translation company has grown to more than
80 ofces on six continents
and had $341 million in
revenue last year. And that
has created a problem for
co-CEOs Liz Elting and Phil
Shawe: how to stay in touch
with more than 2,600 employees, 600 of whom were
hired in the past 12 months.
The company also relies on
5,000 freelancers.
Their solution: small
teams and training. Lots and
lots of training.
To help with that training,
Elting and Shawe tap longtime employees to lead new
ofcesparticularly those
who embrace the companys
entrepreneurial mindset.
Nearly all of TransPerfects
executives were promoted
from within. Most have been
with the companywhich
started in Shawes dorm room
at New York University in
1992for at least a decade.
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Also helpful: These ofce

leaders divide up their business units into smaller groups,
to ensure that all employees
get close contact with their
bosses on a daily basis. We
dont have a bureaucracy,
says Elting. People feel like
theyre part of a team and can
really make an impact.
Once new workers are
brought on board, the learning beginsan education that
continues throughout their
careers. A certication program helps linguists boost
their translation skills as well
as their knowledge of the
industries TransPerfect
serves. Sales people attend a
yearly intensive, three-day
WorldMags.net
PhotograPh by ERIN pATRICE ObRIEN
office hours Phil shawe

and liz elting spend a lot
of time training new
employees. and then the
learning really begins.
489
jobs created
1,572
totaL 2013 jobs
$341.3
million
2012 reVeNUe
training conference. A dozen

professional development
groups within the company
encourage growth in areas
such as managing and leadership. Another group provides
a place for female employees
to share tips on issues such as
balancing work and family.
It all adds up to a business
that feels as much like college as it does a fast-growing
company. Theres a ton of
energy, because were growing so much, says Matt
Hauser, TransPerfects vice
president of content solutions. I feel like Im in grad
school every day, rubbing
elbows with cool, new,
interesting people.
All of those programs,

Elting says, have helped
TransPerfect win big projects
from clients such as the U.S.
Postal Service, Nestl, and the
American Heart Association.
Meantime, employees who
stick with the company can
be richly rewarded for their
service. High achievers who
stay at least three years are
eligible for a big salary bump.
One employee who recently
hit the 10-year mark wrote a
thank-you note to the CEOs
not just for the Tifany clock
he got as a gift but for the
unannounced bonuses and
raises that allowed him to
purchase a home.
TransPerfect also ofers
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litigation support, stafng,

and technology services.
To make sure it excels in all
areas, the company runs an
internal innovation contest to
solicit employees best ideas
for improving their departments. Many relate to boosting efciency and using
technology more efectively.
The chance to innovate, says
Elting, is another draw that
makes people want to stay.
Indeed, Hauser says a great
thing about his latest job is
the freedom to try new sales
methods. If you want to
chase something, he says,
the company is not going to
hold you back.
ELAINE POfELdT
LAUNCH
WorldMags.net
Urban
lending
solUtions
no.8
An Eye
for Talent
Urban Lending
Solutions CEO
Charles Sanders nds
employees where
other companies
dont think to look
charles sanders is a big
believer in second chances
for his customers, his employees, and himself. A star
running back in college, he
wound up playing two seasons for the Pittsburgh Steelers in the 1980s. When that
didnt work out (in 19 games,
he rushed for 77 yards and
one touchdown), he did marketing for a semipro basketball team, the Pittsburgh
Piranhas. One day, he asked
the teams owner, How did
you make so much money?
His answer: Real estate.
Today, Sanders is CEO of
Urban Lending Solutions, a
1,564-person company that
provides back-ofce support
for large banks from ofces in
Pittsburgh and Broomeld,
Colorado. More than 1,000 of
those positions have been
created since 2012. How does
Sanders ll so many spots so
quickly? By hiring bright and
ambitious people, regardless
of their background. So while
his rivals are busy competing
for experienced real estate
professionals, Sanders might
tap the manager of a McDonalds or an ambitious community college grad. Creating
30 - iNC. - November 2013
PhotograPh by ross mAnTlE
jobs, says Sanders, is about

knowing the barriers to
someone getting a job.
The strategy appears to be
working. ULS, which was
founded in 2002, brought in
$183.1 million in revenue
in 2012 and has grown 257
percent since 2009.
Sanders credits that success to the companys unusual
training program, Urban
University. Focused mainly
on educating the companys
mortgage services department, the internal training
arm ofers 15 courses in subjects such as underwriting
and loan processing. Not only
does the program get new
hires up to speed; it also
allows the company to shift
gears quickly when market
conditions change. When
Sanders began to sense a
downturn in the mortgage
market in 2007, Urban University quickly launched a
program to give staf members skills in modifying

troubled mortgages for
homeowners. Such activity
now accounts for a large
chunk of the companys business, and Sanders insists that
his agents bring tremendous
sensitivity to it. We are talking about someones home,
Sanders says. Think about
the home you grew up in, the
home you hope to have, the
home you dont want to lose.
Given the amount Urban
Lending invests in its people,
ULS plans to keep them for a
long time. It ofers a generous
prot-sharing program and
promotes from within as
often as possible. The company recognizes that tomorrows leaders are already in
the company, says Michael
Alden, a senior vice president. Its just a matter of
developing them.
A member of the National
WorldMags.net
PlayMaker Urban Lending

Solutions Ceo Charles
Sanders, a former Pittsburgh
Steelers running back, works
to create opportunities
for minorities inside and
outside his business.
1,022
jobs created
1,564
totaL 2013 jobs
$183.1
million
2012 reVeNUe
TOP 25
WorldMags.net
Head of tHe ClasstHe

top Job Creators of 2013
Meet the cream of the crop from this years
Hire Power Awards. The companies below
are growing fast and hiring just as quickly.
Heading the list for a second year in a
row is Universal Services of America. For
the complete Hire Power list as well as
expanded coverage and features, head to
www.inc.com/hire-power.
RANK/COMPANY
Minority Supplier Development Council, Sanders also

works to create jobs outside
his company by ofering
technical assistance to
minority-owned businesses.
I know the challenges facing
the African-American community as far as jobs and
wealth, says Sanders. As
you grow those rms,
theyll employ more people
who are minorities.
All this activity has engendered a deep sense of loyalty
and purpose among Urban
Lendings employees. Alden,
who joined the company in
2011 after a long career in
corporate America, says the
satisfaction of helping people
through a successful loan
modication is unbeatable.
Youve got people in their
homes because of what we
do, he says. We make a
diference in peoples lives.
E.P.
CEO
LOCATION
1 Universal Services of America
Steve Jones
Santa ana, Calif.
JOBS
CREATED
TOTAL
JOBS
14,240 35,000
REVENUE
$500M$1B
2 Vivint
Todd Pedersen
Provo, Utah
1,943
6,496
$100M$500M
3 Heartland Dental Care
Richard Workman
Effingham, ill.
1,759
4,965
$500M$1B
4 Guaranteed Rate
Victor Ciardelli
ChiCago
1,535
2,784
$500M$1B
5 Wingspan Portfolio Advisors
Steven Horne
Carrollton, tExaS
1,344
1,704
$50M$100M
6 Strike
Steve Pate
thE WoodlandS, tExaS
1,236
2,627
$500M$1B
7 Freedom Mortgage
Stanley C. Middleman
moUnt laUrEl, n.j.
1,080
1,987
More than $1B
8 Urban Lending Solutions
Charles Sanders
PittSbUrgh
1,022
1,564
$100M$500M
9 Digital Management
Jay Sunny Bajaj
bEthESda, md.
1,009
1,431
$100M$500M
10 Pacic Dental Services
Stephen Thorne
irvinE, Calif.
856
4,298
$500M$1B
11 Yodle
Court Cunningham
nEW York CitY
756
1,173
$100M$500M
12 Flying Food Group
Sue Gin
ChiCago
717
4,244
$100M$500M
13 Total Quality Logistics
Ken Oaks
CinCinnati
642
2,316
More than $1B
14 AirWatch
John Marshall
atlanta
609
891
$50M$100M
15 Residential Finance
Michael Isaacs
ColUmbUS, ohio
570
901
$20M$50M
16 Ryan
G. Brint Ryan
dallaS
565
1,356
$100M$500M
17 Monogram Food Solutions
Karl Schledwitz
mEmPhiS
551
1,471
$100M$500M
boSton
516
1,347
$500M$1B
489
1,572
$100M$500M
holt, miCh.
480
1,350
$500M$1B
21 Loyal Source Government Services Seth Eubank
orlando
473
552
$20M$50M
22 Summit Security Services
Nicholas Auletta
UniondalE, n.Y.
459
2,446
$50M$100M
23 New American Funding
Rick Arvielo
tUStin, Calif.
447
786
$100M$500M
24 The Select Group
Sheldon Wolitski
ralEigh, n.C.
446
660
$20M$50M
25 Intelligrated
Chris Cole
maSon, ohio
435
2,300
$5M$10M
18 Wayfair.com
Niraj Shah
19 TransPerfect
Liz Elting & Phil Shawe nEW York CitY
20 Dakkota Integrated Systems
Andra M. Rush
HOW HIRE POWER cOmPAnIEs WERE sElEcTEd the list measures the number of jobs added from January 1,
2012, through June 30, 2013. to qualify, companies must have been founded before January 1, 2009, and be
U.S.-based, privately held, and independent. Employees are dened as those who are working a minimum of 30
hours per week and receiving benets from the company. Qualifying full-time and part-time employees are
included; independent contractors are not.
WorldMags.net
LAUNCH
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phOTOgraph by ryAN lowry
tAskMAster Total Quality

Logistics founder and CEO
Ken Oaks stresses a Work
hard, play hard mentality
to his employees.
totAl quAlity logistics
no. 13
Slackers Need Not Apply

Total Quality Logistics has found a way to lure ambitious college
graduates into the trucking industry. Hint: It involves money
A cAreer involved in
shipping truckloads of
lettuce across the country
might not seem to be a natural draw for young strivers
straight out of college. But
Total Quality Logistics has
found a way to recruit and
hire them in droves.
The Cincinnati-based
freight broker, which acts
as the middleman between
trucking companies and
businesses needing to ship
their products, brought in
$1.3 billion in revenue last
32 - iNC. - NOvEmbEr 2013
year, serving companies like

the grocery-store chain
Kroger. A large chunk of the
companys 2,316 employees
are recent college gradsincluding many former college
athletes and military veterans. Ken Oaks, the companys
CEO and founder, has found
that this demographic ts in
perfectly with his companys
highly competitive environment. They have discipline,
he says. They have a regimen. Theyre all about
coming in early and getting
the job done.

What makes TQL attractive is that the business is set
up to reward the hardest
workers. For entry-level sales
jobs, new hires work on a
salaried basis during a fourto six-month training period.
Once theyve got the hang of
things, the company moves
them to a salary plus an
uncapped commission. At
that point, theyre kind of like
stockbrokers, with the opportunity to build their own
book of businessa set of
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642
jobs created
2,316
totaL 2013 jobs
$1.3
billion
2012 reVeNUe
LAUNCH
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HIRE POWER
WorldMags.net
clients theyve signed on
and reap the rewards in big
commissions. The average
pay for a second-year employee is $60,000, according
to Oaks. After three years,
the average jumps to $81,000,
and, after four years, $112,000.
Given that Cincinnatis cost
of living is 10 percent below
the national average, TQLs
employees can live pretty
wellif they are willing to
work for it.
Oaks acknowledges that
the jobs are not for everyone.
Its high stress, high pressure, but a lot of these people
thrive on that, he says.
Thats a good thing, because
they dont work 9 to 5. All
account execs must work
three out of four Saturday
mornings a month during
their rst six months with
the company. Its because
were getting loads from
customers all the time, Oaks
says. Weve got carriers on
the roads that need our help.
Graham Wagner joined
the company in 2010 after
graduating from Bowling
Green State University with a
degree in business administration. He says he likes the
companys fast-paced, highenergy atmosphere as well as
the freedom to control his
income. A lot of other jobs
would be really monotonous, he says. Wagner knew
he wanted to work in sales
and wasnt surprised by the
pressure. During the interview process, he listened in
on live calls with clients
something Oaks likes potential hires to do to make sure
they know what will be
expected. Any number of
unexpected things can go
wrong with a shipment, and
truckers arent exactly
34 - iNC. - November 2013
known for their delicate

manners. They have to have
thick skin, Oaks says. This
isnt the oral industry. Its
the trucking industry.
Theres a reason Oaks
pushes his employees as
hard as he does. Working
years ago for a company that
bought and sold produce,
Oaks was nearly driven
crazy by unreliable freight
brokers. I couldnt nd
anyone who was dependable
and available 24/7, he recalls. There were a lot of
unethical and low-service
providers in the industry.
That experience ultimately inspired him to start TQL
16 years ago. In our industry,
there arent a lot of players
that concentrate on the
service part of it, he says. He
started his business with that
in mind. Were kind of
obsessed with making sure
we treat customers and
carriers the way they deserve
to be treated. This year, the
company is on track for $1.7
billion in revenue, making it
the countrys second-largest
freight brokerage rm
by revenue.
All of this isnt to say that
its all work and no play at the
company. Oaks makes sure
there are plenty of fun activities at which employees can
blow of steam. This fall, the
company is hosting its rstever TQL Urban Racea
3.5-mile obstacle course run
through the streets of downtown Cincinnati. Giving back
is also part of the company
culture. Last year, for Breast
Cancer Awareness Week, it
hosted a Great Shave competition, in which the team that
raised the most money for
charity got to shave its managers head. E.P.
BY THE NUMBERS
51,327
number of jobs created
141,270
number of employees in 2013
601
median 2013 employee count
moneymakers
The revenue range for Hire Power companies

$5 million$10 million
4

5

27
20

25
$500 million$1 billion
More than $1 billion

5
Where the Jobs are
Industries with the most Hire Power companies
HEALTH
FinAnciAL sErvicEs
soFTwArE
HumAn rEsourcEs
iT sErvicEs
11
9
8
7
7
the states With the Most

hire Power companies
cALiForniA
15
nEw york
FLoridA
11
mAssAcHusETTs
TExAs
6
iLLinois
oHio
6
uTAH
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5
5
5
5
LAUNCH
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Inc. 5000 InsIghts
how to Take a
Fresh approach to
a Staid Old Trade
A fast-growing builder
finds inspiration outside
its industry
Not much has changed in the construction industry
in the past 100 years or so, says Ann hand, cEO of

Project Frog, a san Franciscobased company that
builds energy-efcient prefab buildings. Its an industry just waiting to be disrupted. her company is
working to be the one that does it. By using standardized core components and less-expensive materials,
Project Frog can produce buildings in half the time and at 20 percent of the cost of traditional construction. Plus, a Project Frog building consumes half the energy of a conventional structure. the companys
approach has helped it land more than $40 million in funding from investors. With $28.7 million in
revenue in 2012, Project Frog earned the no. 930 spot on the 2013 Inc. 5000. here, hand ofers tips on
rethinking the way things are done in a slow-moving industry like construction. jEnnIFEr AlsEvEr
Look outside your iNdustry
Hand decided that

Project Frog should
take its cues from companies such as Boeing
and Toyota rather than
traditional construction
companies. That can
be seen in the way
parts and components
are put together to
churn out a building
quickly. Our marching
orders were that if
Boeing could build an
airliner in 11 days, why
does it take 12 months
to build a school? she
says. She regularly calls
on executives from
G.E., Toyota, and
Boeing to oat ideas
and get feedback on
processes and strategy.
36 - inc. - novemBer 2013
hire a diverse mix
Hands 40 employees
include architects
and construction
experts, but also a
mixture of engineers,
product designers,
supply-chain experts,
and manufacturing
managers who can
draw on diverse
backgrounds to brainstorm new ideas and
approach construction
diferently. The magic
of Project Frog is
the healthy tension
we create between
traditional construction, product design,
and manufacturing,
says Hand.
Get customer Feedback earLy
Hand targeted Project

Frogs most promising
customersschool
districts and health
care companiesand
talked to them to learn
about the building sizes and features they
needed and the prices
they were able to pay.
She invited them to
view early drafts of
designs and mockups
of real prototypes going up inside a warehouse. We would try
some things, evaluate,
and iterate over and
over, she says. At the
end of it, we had
something that met
customer needs and
was therefore sellable.
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hiP to be square
A Project Frog building
welcomes visitors to
San Franciscos Golden
Gate Bridge.
PartNer uP
For Hand, Project

Frog is more of a tech
business than a construction rm. Like the
iPhone, Project Frog
serves as a platform
for showcasing other
companies technologies. For instance, every
school the company
builds integrates LED
lighting, automatic
shades, and plasmaTV-screen teaching
walls. This story line
came in handy when
calling on investors
and executives at G.E.,
which became the lead
investor in a $22 million
cash infusion.
launch
mAriko reed/courteSy Project FroG
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All Systems Grow

Image-Building
Theres a new icon in the global economy: the entrepreneur who runs a
seemingly large operation from his or her kitchen table, basement, or garage.
The key to making it work: Creating a larger-than-life image of your business.
Image-Building, a new guide from The UPS Store and Inc. magazine, can help
you create a plan for delivering bigger than you are.
THIS GUIDE INCLUDES:

Image-Building Best Practices:
Highlights the tools your small business needs
to meet big expectations, and shows you how
to use all of the resources at your disposal to
deliver above and beyond in-house capabilities
Real-world case studies from:
Michigan-based BBQ sauce company,
P&K Private Stock
Pink Ribbons, an extremely compassionate
niche business
BeStitched Needlepoint, a thriving business
with a keen focus on service
An Image-Building Toolkit:
Loaded with information about how a suite of
solutions, from The UPS Store, can help you
project a big image
To learn more about how you can scale your growth to your aspirations, download
your free copy of All Systems Grow: Image-Building at inc.com/theupsstore.
Visit The UPS Store Online: smallbiz.theupsstore.com

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I make the crust by hand.

I make the lling by hand.
But to build my business,
I need a hand.
SMALL BUSINESS: YOURE NOT ALONE OUT THERE. Sandy, owner of The Right Slice, makes pies. Amazing pies. And when tourists
asked to ship pies from her Hawaiian island shop in Kauai to the mainland, she went to The UPS Store in her neighborhood. Because while Sandy
knows all about aky crust and fruit lling, The UPS Store experts know all about packing and shipping. And they can even put together
professionally printed yers, business cards and menus, easy as Mango Passion Fruit Pie.
Locally owned and ready to help. At The UPS Store, we love small businesses. We love logistics.
Check out Sandys video and learn how The UPS Store can help your business at
theupsstore.com/smallbiz
POSTERS
Copyright 2013 The UPS Store, Inc.
FLYERS
MENUS . BUSINESS CARDS .

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CERTIFIED PACKING EXPERTS
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T H E S TA r T I N g l I N E
Eric Paley
The Best advice

You are not Taking
Before you dismiss
obvious advice,
try listening harder
businessmen in suits sit around a conference room

making insanely obvious statements and the tag
line is something like, If business were this easy,
you wouldnt need us.
No matter how obvious these suggestions may
seem, take a minute to really consider the earnestness of your eforts. When it comes to operational
issues, your start-up often succeeds or fails in
accordance with the degree to which your company embraces these seemingly obvious ideas
or suggestions. The advice may not seem earth
ost of the business advice youll
shattering, but very often it is the successful
receive as a start-up CEO seems
companies that embrace that advice and put
obvious. In fact, its rare that
forward a serious efort in following it.
an investor or adviser makes a
Take, for example, an exchange between you,
suggestion that you have never
the founder, and an investor. The investor is
considered. More often than not,
concerned about the quality of your customer
the suggestion is, in fact, probably
development and advises you to get your hands
already being implemented at
dirty spending time with clients. Thats completely
some level.
obvious to you, and you respond that youve done
Your company isnt scaling
so and will continue to do so.
as quickly as planned, and a board member says you need to boost
Box checked and issue resolved, right? Not at all.
sales. No kidding? Thanks for letting us know, you sarcastically
Yes, technically you are talking to customers,
think to yourself. Even the more concrete suggestions from
but are you doing enough of it? Because you are
experienced advisers or team members often seem either painfully
already talking to customers, its very easy to
obvious or just a regurgitation of things the company is already doing
shrug of the advice and move on. However, that
or has tried before. From your viewpoint, it can feel demeaning,
advice typically reects the investors concern
because it suggests that your job is so easy that people think they
about the scale of your eforts. In this instance,
can do it just by ofering generic advice.
the investor is trying to tell you that whatever
At times, it can seem like that TV commercial in which a bunch of
amount of customer development youre doing,
you need to do much more.
When I read Delivering Happiness, by Zappos
CEO Tony Hsieh, I found the book both incredibly
eric Paley is an entrepreneur
insightful and incredibly obvious. The book explains Zapposs formula for successputting
and a managing partner of
the customer rst and ofering delightful customer service. Most of what Hsieh writes
Founder Collective, a seedstage venture capital fund.
about probably seems familiar to any business owner. What business doesnt want to put the
He is based in Cambridge,
customer rst and ofer delightful service? The diference between Zappos and most other
Massachusetts.
companies is one of magnitude. Zappos manages to do so at a completely diferent level than
almost everyone else.
As a CEO, you should never blindly follow the advice of anyonebe it a team member,
a board member, or an adviser. After all, whatever the outcome, it ultimately belongs to you.
But you do need to seek out the best advice you can get to gure out the right answer.
Sometimes, the right answer comes from someone in a way that seems painfully obvious.
But remember, just because its obvious doesnt mean its wrong.
40 - inc. - NoveMber 2013
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launch
evaN kaFka
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For more than 200 years, through fire, weather and
the unexpected, The Hartford has been helping
Because your ame

burns a bit brighter.
over 1,000,000 small businesses prevail. Were at

our best when things seem at their worst, proudly
helping companies like Classic Metal Craft play on.
Let the sparks fly at thehartford.com/200
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ofce is Simsbury, CT. 2013 The Hartford Financial Services Group, Inc., Hartford, CT 06155. All Rights Reserved.
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WHAT PRACTICES have

gotten you where
you are now?
WHAT HAVE you
gured out that
other entrepreneurs
should know?
WHERE DO
you excel?
We asked those
questions of two
dozen accomplished
entrepreneurs and
no surprisegot an
abundance of smart,
frank, useful answers.
WALK THIS
WAY WITH
SOCIAL-MEDIA
EXPERT GARY
VAYNERCHUK
Turn the page for

a special 16-page
peer-to-peer guide
to what works.
PHOTOGRAPHS BY JAKE CHESSUM
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Twitter
Gotta be
quick.
Facebook
Be original.
Think like a
creative
agency.
Instagram
This is
personal.
Of and Running
Gary Vaynerchuk is a
social-media maven
with a lot to say. As
youll see.
As told to LEIGH BUCHANAN, TOM FOSTER, BURT HELM, and ISSIE LAPOWSKY
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Pinterest
Attention,
shoppers!
HOW TO MASTER
THE FOUR BIG SOCIALMEDIA PLATFORMS
Gary Vaynerchuk is the CEO of VaynerMedia.
THINK OF HOW YOU act with
your friends versus how
you act with your clients.
You behave diferently
based on your environment. Social media is
the same thing. Every
platform is like a diferent
meeting, a diferent room,
and you have to be cool or
quality depending where
you are. Most people think
of social media as distribution and use the same
messaging on every
platform. Thats not fully
exploiting the tools.
Instead, its important to
gure out how to natively
tell stories on each platform and which visuals
and copy will enhance
the likelihood of a given
posts going viral.
LEAD
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Know-how Edition
TWITTER
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INSTAGRAM
I included #business, because

it was a trending topic at the
time of this tweet. When you
use a hashtag thats trending,
you have a substantially better
chance of getting engagement
from people who arent your
followers. The couple hundred
people who click that hashtag
every hour around the world
might also see it, and I might
get some traction I might not
otherwise have gotten. I also
made my tweet a question,
because it makes your brain
think about the answer. If I can
get someone to stop for half a
second to ponder, Ive got him
in my ecosystem. Also, line
breaks allow your tweet to take
up a larger portion of the phone
screen and attract attention.
Instagram is all about real images. Where are you? What are
you looking at? What are you
doing now? Unlike the polished
images youll see for Facebook
and Pinterest, this is a simple
shot taken on a phone. Its native
to the platform. That doesnt
mean you cant include information or text in your photo. I
wrote some of the tasting notes
directly onto the tablecloth. The
only place where links are clickable in the Instagram app is in
your bio. Rather than including
a link in the post copy for people
to copy and paste in a browser
(because, honestly, who would
ever do that?), I put the link in
my bio. Remember, the more you
act human, the more you win.
Instagram is personal. Its for
those real-life moments.
FACEBOOK
It all starts with the image.

Notice, this image isnt just the
label of the bottle. Its an original piece. When youre developing images for Facebook, think
about print and magazine advertising. I want people to know
what wine it is (hence the crop
in on the label) and how good it
is (hence the Wine Enthusiast
score). Keep your copy short.
Include the important information that people will care about.
In this case, its the rating, the
price, and the right hook: Click
here to buy now. And dont be
afraid to go in for the sale. If you
want someone to do something,
you have to ask him or her to do
it. I made sure to include the
word buy before the link.
ILLUSTRATIONS BY DAVID WILSON
Pinterest is all about aspiration

or utility. Here, Im not just
selling wine; Im giving knowledge. This infographic gives
context and tells you everything
you could want to know about
this bottle. This is just too much
text for any other platform, but
it feels right at home on Pinterest. People are shopping on
Pinterest, so theyre spending
more time on the content and
looking at it with a critical eye.
I used a much longer image on
Pinterest than on any other
platform. The platform dimensions are diferent and allow for
it, but more importantsimilar
to what I did on Twitterlonger
pins take up more real estate.
How to Love
Your Own
Company
Brooks Bell is the CEO of the
technology company Brooks Bell.
Everyone assumes the companys CEO is fully committed to the vision.
The truth is, a lot of CEOs arent. Around 2007, I was one of them.
We were, at the time, a creatively driven email marketing company.
People hired us for our email design. We were being very opportunistic.
We said yes to anything and werent strategic about it.
It wasnt fun to work there. I wanted Brooks Bell to be a datadriven testing company, where the analysts were the rock stars.
I left the ofce for about a year, going to diferent data confer-
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COURTESY GARY VAYNERCHUK
PINTEREST
is really just how people

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behave when they think
HOW TO BRING NEW EMPLOYEES

INTO YOUR CULTURE
Will Dean is the CEO of the adventure-race company Tough Mudder.
KLAUS THYMANN/TRUNK ARCHIVE
PEOPLE COULD DIE if we get things

wrong. A lot of our employees
are young, and they operate
with little direct supervision,
putting on events in elds
thousands of miles from where
I sit. Were a very specic kind of
company, and we need very
specic kinds of people.
TO FIND THEM, WE HAVE TO DO FOUR THINGS:
run really good recruitment,

induct people, train people, and
assess people. We use the
acronym RITA.
INDUCTION IS THE MOST COMPLICATED.
Its easy to put your values on

the wall. It means nothing.
Its about behavior. Culture
ences to learn that world. By the time I got back, I knew what I had to do.
I needed to change my team, change all of our clients, shift from creative to
data, and completely redo my business model. We started with the team.
We let ve people go, which was the most difcult moment Ive ever had.
Another ve people left on their own over the next three months. Then I
hired 10 people over the next six months, people who were aligned with the
new goals. We had four major clients at the beginning of this period, and we
retired one of them every year.
youre not looking.
WE TEACH PEOPLE how we expect

them to behave. The induction
period is three weeks. We
started doing it in May of last
year. We got to the stage
where we were happy with our
organization and the culture
we had and felt like we were in
a position to scale it.
PART OF THAT TIME is spent sitting

in a classroom and having
people come and speak. We
also have group discussions
and give people mentors, with
whom they can discuss things
condentially. Then we do
team bonding activities, like
sending people out on treasure hunts or taking them
surng. The point is to make
them feel they have a set of
peers across the company. I
also personally sit down with
groups of new people for an
hour and a half and let them
ask me anything they want.
CULTURE EATS STRATEGY FOR BREAKFAST,
and its far easier to keep the

right culture on track than get
the wrong one back on track. So
gure out which behaviors are
sacrosanct at your organization
and which ones are profane.
Then take all four steps of RITA
and ask yourself three months
later, Am I really seeing the
behavior I want to see?
It was the rst time I nally embraced the idea of thinking strategically,
not waiting for someone to pick me and tell me what to do. I got to go out and
create the market I wanted.
Most entrepreneurs wont admit theyre not all in and are feeling less
committed than they once did. But realize: It starts with you. Have a vision
of what you want. Let there be a huge gap between where you are and how
youre going to get there. Map out the next two steps and let the rest be a
gray area. Trust that youll get there if you stick to that vision.
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LEAD
Know-how Edition
HOW TO REALLY
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CONNECT WITH
CUSTOMERS
Andy Kurtzig is the CEO of Pearl.com, which
connects customers to lawyers, doctors,
mechanics, and veterinarians, who answer
questions and dole out advice online.
Ive devoted every

Thursday, all day, to cold
calling current customers.
I call it Smile and Dial.
I start in the morning calling
East Coast folks, then move to
the West Coast later in the day.
Its hit or miss. Half the people
answer, and of those, 20 percent of the people say theyre
too busy. The rest are happy
to chat at least for a couple
minutes. Ill have really rich
conversations with about
half of them.
When I call, Im thinking,
Care, care, care. I pretend like
its my mom or my grandmom
or my dad. I care about their
grandkid, about their dog; I care
about their life. Im focused
on that, that shows, and they
really open up. And then I actually do care. Im so fascinated
that I dont have to do a trick.
I want to nd out who they
are and how and why they use
our service, and how we can be
better. I dont say Im the CEO,
because I dont want them
blowing smoke. I dont try to
solve their problems on the call
very often or defend us. After
the fact, Ill worry about that.
I want the truth, whether its
good or bad.
HOW TO MANAGE
MILLENNIALS
Neil Blumenthal is the co-founder and co-CEO of Warby
Parkerand, by a matter of months, a Millennial himself.
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FORGET
WHAT
YOUVE
HEARD
All those articles that scold

Millennials for their supposed entitlement? Forget
them. Millennials are great
employees. There is no
reason to plan to accommodate this nonexistent trait
or to break anyone of it.
JAN KORNSTAEDT/ GALLERY STOCK
SINCE JANUARY,
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How to
Johnny Earle is the

founder and CEO of the
T-shirt company Johnny
Cupcakes, which operates
ve bakery-themed stores
and regularly opens
pop-up stores.
Amanda Peyton is the

co-founder of Grand St.,
an online shop for
creative technology.
a very ambitiondriven organization;

everyone who works on
Grand St. is sort of obsessive about it. Thats
why we take a monthly
eld trip outside the
ofce. It usually takes
a whole daywe might
go to art galleries, or
we might spend the
day at the beach. Its
not a team-building
thing at all. Theres no
agenda and no structure. Its about creating
an opportunity for
blue-sky days. The
reason we impose
these days is that if
we didnt, people
would just keep going
and going and going.
We have to ercely
command time for fun.
WE ARE
MEET
THEM
HALFWAY
Young people entering

the job market seek
employment at companies with values that
match theirs. Implementing a thoughtful social
mission will help you
attract top talent.
PICK AN
OPTIMAL TIME
Weekends and evenings are best, because
people dont have to
rush from work. Dont
open your doors at the
same hour as everyone
else. On weekends,
wait until early afternoon. That gives you
greater opportunity to
pass out iers and stir
excitement on the
street. Also, fewer
hours adds a kind of
limited-edition urgency
to the experience.
PROMOTE
EXTENSIVELY
AND CREATIVELY
Start reaching out to
journalists and calendar
editors a month in
advance. You can
approach bloggers a
little later. Make your
marketing collateral as
distinctive as possible.
GIVE
THEM
THE BIG
PICTURE
Stage a
Grander
Opening
INTRODUCE
INTRIGUE
Tease peoples curiosity by ofering a mystery gift or a surprise
guest. The words free
and mystery are always
a good idea. Limit the
number of gifts, but
keep it reasonably
large: for the rst 100
customers, for example. That wont
bankrupt you.
ENLIST YOUR
NEIGHBORS
Surrounding businesses wont love it
when your customers
block their entrances
and overrun the parking lot. Warn them in
advance, apologize for
the inconvenience,
and invite them to get
involved. Businesses
love to cross-promote,
so suggest they
provide products for
your grab bags or
other giveaways.
RECRUIT LOCAL
FOOD VENDORS
People show up for
free food. So why not
get food for free and
establish relationships
with other local vendors
in the process?
STAFF UP
INSIDE AND OUT
Recruit volunteers if
you must, but make
sure you have enough
people working the
oor and the registers
and also keeping an eye
on the street. Stanchions will help keep
Millennials are eager to

make an impact, which
makes them ideal for
start-ups. Let them know
exactly how their contribution ties into the big picture
by sharing high-level
insights and objectives.
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LEAD
order. But someone

should be out there
enforcing the single-le
lineand, not incidentally, talking up the
company and answering questions.
HOLD A SOFT
OPENING
Invite friends, relatives,
vendors, and members
of the press to a runthrough a night or
two before the event.
Employees get on-thejob training before
facing more-critical
hordes, and glitches will
reveal themselves.
ADVERTISE COMING
ATTRACTIONS
Make sure departing
guests walk of
with your calendar
of upcoming events
and sales.
DOCUMENT
LAVISHLY
Produce lots of photos
and videos to post to
social media after the
fact, so people will see
the business at its
busiest and liveliest.
Youll also want the
record for yourself.
Youll be so swamped
and distracted during
the event that the best
way to enjoy it may be
retrospectively.
DISCOURAGE
TWERKING
It just makes
the rest of us
feel inadequate.
Know-how Edition
How toWorldMags.net
disrupt
tHe workday
for fun and
profit
John Coleman is the founder of the creative agency Via.
10
How to be a good
investor (beCause a lot
of entrepreneurs arent)
50 - inC. - nOvEmBEr 2013
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Chris Heivly, once the CEO of

Mapquest, is now a co-founder and
managing partner at The Startup
Factory, an accelerator in Raleigh,
North Carolina.
Ive seen a lot of successful entrepreneurs fail as investors in start-up
companies, most because they make
at least one of these mistakes:
mAAk rOBErTs/ gAllEry sTOCk
iF YOu wanT TO rEmain creative and open to

innovation, the worst thing you can do is
work yourself into a rut, where youre not
engaging in new experiences in the world.
So we try to break up the routineto
almost train people how to change.
Some activities are up to employees
we have a bocce court outside, and people
break up the day with 15-minute tournaments. On Tuesdays, we have music jams
at the end of the day. But then there are
total surprises. The other week, we called
a meeting, shut down the whole agency,
and took everyone next door to a local dive
club to have a free drink and dance for the
lunch hour. People were rolling their eyes in
the beginning but left laughing.
There are quieter diversions, too. Our
ofce is in the old public library in Portland,
Maine, and weve asked all our employees
to select the 10 most inspiring books in
their life. Ayn Rand shows up a bunch, but
there are also design books, Mark Twain,
Longfellow, Pablo Neruda, a book on stars,
and Picassos sketches. Now we have a
reading library with more than 1,000 books
to sign out.
With all these disruptions, the rst rule is,
We want to make everyone leave the
phone, leave the computer, and be in the
real world, in the moment. The second is,
We want to force you a smidge outside your
comfort zoneget you to open your mind.
And the third rule is, It should be kind of fun.
Because isnt that what its all about?
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Andy Dunn is the co-founder and CEO of

the menswear company Bonobos.
Interviews are not a good way
to get to know a person. The

process treats hiring like a
romance, as if that had anything to do with the eventual
marriage. Ive found that
human judgment is really bad
in the romance phase of any
relationship, because both
sides are showing their best
cards. What you really want to
know is, What are the worst
things about the person and
about the company, and are
those things going to work
together?
We interview extensively,
of course, but I think its the
third-best hiring tool.
No. 1 is actually simulating
the job. During the recruiting
process, we bring candidates
in and have them do the job
for a while. For our customer
service Ninjas, we have them
respond to customer email.
For a VP candidate, I might
bring him or her in to advise
on a big decision: Here are the
issues were facingnow run a
meeting where we gure out
what to do. At the more senior
level, I tell people, If we are
going to hire you, we are going
to spend about 40 hours of
your time. That might sound
crazy, but ideally we want this
They invest
in good ideas
rather than
good founding
teams.
They expect the same

pace, the same rush
they experienced running
a company. When they
dont get it, they grow
impatient. Then they get
destructive.
In the hour or
two a week they
spend on their
investment, they
try to be the CEO
of the company.
They invest alone

as opposed to in a
group with other
investors. They
dont spread the
insight, the burden,
or the risk.
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relationship to work for the

next four or ve years; thats
200 to 250 weeks. Why
wouldnt we invest one week
of time guring it out? And by
the way, if at the end you
decide you dont want to do
this, thats a great outcome.
No. 2 is of-list references.
Everyone does on-list references, but thats such a
checking-the-box exercise. Its
like, talk to some handpicked
people who will all say Im
great. Its hilariousit should
be a Saturday Night Live skit.
In addition to talking to those
people, you have to take the
time to nd other people who
have worked with the candidate. And this is important:
Try to get in touch with those
people via your own network,
because then theyll feel some
accountability to you and will
be more honest. For associates, well check one of-list
reference. For managers, well
check two. And for VPs and
C-level executives, its at least
ve. More often than not,
weve gotten more excited
about candidates because of
their of-list references. In at
least two cases I can think of,
we pulled the plug on someone we were going to hire.
Do the opposite.
Accept that you are now the
tail, and you are not wagging the
dog. Your foundersthey are the
dog in this metaphorwant your
experience, your wisdom, and your
contacts. (And your money; thats
a given.) Give generously of those
things and accept the parameters
of your role, and everyone has
a chance at success.
Know-how Edition
11
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GARY
ON
How to Fight With Your Family
When I took over the family wine business, my dad and I argued about everythingchanging the name of the store, building a website, hiring developers, giving out 401(k)s. We always argued. Even our ght about moving the beer cooler took six months. Its a
common theme for family businesses. But what always won for me was a combination of massive communication and obnoxious
persistence. I think that a lot of sons and daughters give up. You get yelled at, get argued with, get upset, and dont come back to
the well. I never did that. I wore him down. My advice is: If you believe its right for the business, then nd four diferent angles. Go
in hard, go in soft, come from every angle, and youll nd your way in. And whatever you do, never make it personal. Start bringing
up shit that has nothing to do with the business, stuf that happened at home a month ago, and youre derailed.
HOW (AND WHY) TO

THROW A KICK-ASS
COMPANY RETREAT
12
OUR FIRST COMPANY retreat was just three

employees and myself going to the
park and having a catch. Needless to
say, that was not a good one. Now, I
think weve gured it out.
Ive found that the No. 1 thing that
leads to people being happy at work
is transparency, so at our retreats,
transparency is our focus.
This year, we created breakout
sessions to educate people about
whats going on at other parts of the
company. When people are working
their butts of, its easy to say, My job
is so tough. Why is yours so easy?
The idea of these sessions was to
A. educate people and B. make them
appreciate how hard everyone around
them is working.
The whole company voted for
sessions they wanted to attend, and
we narrowed it down to ve. For one,
we had our ad sales lead talk about
what a salespersons job really entails, which helped dispel the stereotype that sales people are just
wining and dining people.
Another piece of advice: Spend
money. I dont mean waste money.
But the team will appreciate it if you
dont cheap out. If employees feel like
youre really investing in them, theyll
invest back. And dont do it in one day.
Make it two. Make it a big deal, and give people time to let their guard down.
Lastly, take time to make people feel the warm and fuzzies. When we were
smaller, I would give a speech and talk about every employee, one by one. Now, I
talk about each team. At the end of each speech, the whole company gives that
team a standing ovation. Its a real pump-up. If you make people proud of the
work theyre doing, that pride will reect in high-quality work in the future.
52 - INC. - NOVEMBER
JUNE 2013 2013
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FROM TOP: JAKE CHESSUM; EVERETT COLLECTION
Ben Lerer is the co-founder and CEO of Thrillist.
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HOW TO BE WAY
MORE PRODUCTIVE
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Tim Ferriss is an investor and the author of The 4-Hour Workweek, The 4-Hour Body, and The 4-Hour Chef.
Bonus!
Because
Tim Ferriss always
gets more
done
HOW TO PREP
FOR A CONFERENCE
KEYNOTE
KEEP IT SIMPLE: I break my presentations

into three parts that can all be practiced separately. Within each of those
sections, you have a two-minute intro
and a two-minute conclusion, and in
between you have point-example-point
or example-point-example. In other
words, introduce the concept, give an
example of that in action, then rephrase the point.
I strongly believe that declarative and procedural knowledge are consolidated during sleep cycles, so I do the
vast majority of my preparation the
night before. Practice each section separately. Its much easier to ace your delivery if you practice Section A, which is
10 minutes long, 10 times in a row, and
then Section B 10 times in a row, then
Section C. Only then do you string them
together. If I nail a given portion in rehearsal, I listen to a specic piece of
music to anchor it to that section. I
anchor all my good deliveries to that
track, and then I listen to it again before
I go onstage. I like Splinter, by Sevendust, but thats just me; its very heavy.
BREAK IT UP:
WAKE UP WITH
MORE ENERGY
Many people feel tired in the morning
not because they didnt sleep enough
but because they have low blood
sugar. You can minimize this by
consuming a tablespoon or two of
unsweetened almond butter before
you go to sleep. Its a very simple way
to stabilize your blood sugar. (Ive
tested this by having a continuous
glucose monitor implanted in my
side.) Right away, a lot of people will
go from feeling groggy to feeling
extremely alert when they wake up.
14
DOUBLE YOUR READING

SPEED IN FIVE MINUTES
Write down a sentence, any sentence that has eight to 12 words
and lls a single line on a page or
screen. If you read it by starting
your xation on the rst word of
the line and ending on the last
word, youre wasting about 50
percent of your peripheral vision on
margins. Instead, simply make your
starting point two or three words in
from the left side and your ending
point two or three words in from
the right side; you will double your
reading speed. You can try this by
underlining that portion of the
sentence as a guide. You still see
the edges of the text, but youve
eliminated the margins.
15
CLEAR YOUR INBOX

IN HALF THE TIME
The only consistent way to get to
inbox zero is to respond to fewer
emails, because each response
breeds more email. For those you
need to respond to, here are a few
tools I nd helpful.
The rst is ve.sentenc.es, which
gives you a footer that says, Why is
this email ve sentences or less?
and links to an explanation. There are
diferent versions: four.sentenc.es,
three.sentenc.es, etc., depending on
how short you can actually make your
emails. This excuses brevity; it
absolves you of guilt.
Boomerang is an extension for
Gmail. It allows you to do two things
really well: The rst is scheduling
emails to be sent later, so you dont
leave stuf in your inbox and mark it
as unread because you want to
respond to it a week from now.
Second, you can set a time for an
email to boomerang to the top of
your inbox if someone does not
respond, so you dont have to remember to follow up.
The last tool is emailga.me,
which forces you to go through your
email sequentially without an inbox
view, with timers and other gamications. It helps me get through email
in 40 percent to 50 percent less time.
FUEL: If the presentation is anytime other than evening, I eat a small breakfast.
But the night before, I eat a meal very
high in saturated fat and cholesterol
Ill have the double portion of rib eyeto
facilitate testosterone production,
which helps mental acuity as much as
physical performance, something a lot
of people dont realize. Ive also found
that cafeine dosing is perfect for me.
I get the perfect concentration of caffeine with a 16-ounce Diet Coke, 10 to
20 minutes prior to going onstage.
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13
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B ay C a n d l e
n e u r, C h e s a p e a ke
M e i X u , E n t re p re
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Lear n more at www.ChooseMar yland.org.
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Depar tment of Business and Economic Development
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17
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IN THE EARLY days of my

business, I had a lot of
opportunity around
me, but I had a very
green staf. I was trying to lead in every
area of the business.
I was on the lookout
for a CEO when I met
Giovanni Feroce. He
saw the potential for
the business, but he
also saw what we
lacked. He helped me
take that leap to hire
new people. When we
got real talent in, it was
such a breath of fresh
air. I got to focus on my
big talent, which was
the creative part. That
is my strength.
If you feel that anxiousness, that sense
the business could be
more, then you know
you need to access
other talent to ourish.
Make that your No. 1
priority. The last thing
I ever want to do is
something I dont have
enough expertise in.
Know what you dont
know. We all have our
talents. Surround yourself with people who
are as good at what
they do as you are at
what you do.
HOW TO CREATE AN
EXPENSE-ACCOUNT POLICY
THAT WONT BE ABUSED
Dov Seidman is the founder and CEO of LRN, which educates
and counsels companies on ethics and compliance.
Before I describe how this works, I have to explain
a few things about our company. Because this
is not the kind of thing that succeeds
just anywhere.
LRN is trying to become a self-governing
company, which means we dont have bosses.
Instead, everyone reports to the mission. We
embrace two kinds of freedom. The rst is
freedom from: Our people are free from micromanagement and rules and policies. The problem
is that when you give people freedom from
something, it leaves a void unless you also give
them freedom to. Freedom to means people
not only are able to make decisions without
constraint or permission but also that they have
the information and the habits of thought to
make good decisions.
(By the way, freedom from is diferent from
empowerment. Empowerment means I have
power, and Im a nice guy, so Ill let you have some
under these conditions. With empowerment,
people pay more attention to who has power
than to who is right.)
How a company spends money is a good
indication of its values. Our people can spend
what they see t; they dont have to follow
guidelines or seek approvals. But we want them
to make those decisions based on a crystal-clear
understanding of LRNs values and what is best
for everyone in the company.
Consider expense accounts. For the past few
years, all our people have planned things such

as what trips they will take, where they will
stay, how much they will spend on food, without interference or rebuke. That is freedom
from, and we know it works. Over that period,
our travel expenses have declined. Now, to help
employees with freedom to, we are making
everyones expense reports public to everyone
else on our intranet.
There are a few reasons for doing this. The
obvious one is that people are less likely to order
that bottle of champagne if they know their
colleagues will nd out about it. But more
important, we want to encourage people to think
about spending in a collaborative way. We want
them to consult one another before they take
trips: Was that hotel really worth it, and given
how much you spent on gas, should I consider
public transportation? We also want them to
seeand admiremodels of wise spending. Not
people who pinch pennies, necessarily, but those
who accomplish a great deal (people in companies always know who accomplishes a great deal)
without breaking the bank. We expect those who
do make poor decisions to compare their numbers with their colleagues and learn from that.
Principles are better controls than rules.
Sunlight is the best disinfectant. As we open up
data on travel expenses and all other forms of
spending to employees, we believe everyone will
make better choices for the right reasons.
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LEVI BROWN/TRUNK ARCHIVE
Carolyn Rafaelian is the founder

of the jewelry maker Alex and Ani.
The New Sprinter

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surrounding traffic conditions. 4 COLLISION PREVENTION ASSIST may not be sufficient to avoid an accident.
It does not react to certain stationary objects, nor recognize or predict the curvature and/or lane layout of the
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HOW TO HUMBLE
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18
YOURSELF TO CUSTOMERS
Jason Goldberg is the CEO of the online retailer Fab.
companies. They love products,

experiences, and people. If you want to
create love, you have to work at it. One way
we work at it is through customer surveys.
Listening to customers can be really humbling. Over the summer, we did a survey and
found out we werent always meeting their
expectations. Theyd say, I loved this product, but it took three weeks to get it or, I
love the product, but it took three weeks to
get it, and it was the wrong size, and I
couldnt return it.
I felt the best way to respond was to write
customers an email. I wanted to say, Were
real people. We heard from you, and heres
what were going to do.
I wanted to communicate some honest
humility, empathy, and show that were being
responsive. We didnt just tell people we
would try to be better. We had a plan in place.
We introduced what we call a 100 percent
smile guarantee. We said, If we dont make
you smile, let us know, and well x it. That
guarantee included things they asked for,
such as free shipping and returns, but we also
developed technology to help us exceed their
expectations. Now, for instance, if an item
goes on sale right after a customer buys it, we
automatically credit his account. The onus is
on us to exceed customer expectation, not on
the customer to tell us somethings wrong.
The key to building trust in any relationship
is authenticity. So if you screwed up, own the
situation youre in. People respect authenticity. If youre authentic about what you heard,
the challenges you face, and the motives for
the changes youre making, customers will
give you a whole lot of runway to make it up
to them.
19
GARY
ON
How to Do Spec Work and Feel Good About It
The New York Jets came to me in 2009, just
as I started VaynerMedia, because they

wanted to sell me a skybox in the stadium
for Wine Library. I told them, Forget
about the skybox. The Jets need to be at
the forefront of social media. They were
unsure about hiring me, so I said, Give
me one players Twitter account, and Ill
show you what I can do for free.

I knew it was my cost of entry. Working with the Jets is how I was able to land
the Nets and the NHL as clients, too.
People overthink spec work. They get
too philosophical and romantic about it.
Im not romantic about anything in
business. Dont be crippled by the phi-
losophy. Aim for the biggest possible

client you can get, and treat it as if it is
the highest-paying client of all time. If,
in the end, they try to take advantage of
you and get more work for free, remember: You can re them as easily as they
can re you. The reason youre doing all
this is to get other clients, period.
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FROM TOP: JAMIE CHUNG; NATHAN PERKEL/GALLERY STOCK; JOERG BUSCHMANN/GALLERY STOCK; JAKE CHESSUM
PEOPLE DONT LOVE
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WHATS IN A
NAME
INSTANT CONNECTIONS
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21
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HOW TO
DESIGN AN
OFFICE THAT
MAKES
EVERYONE
MORE
PRODUCTIVE
Michael Lebowitz is the CEO of creative
agency Big Spaceship.
HOW TO NETWORK AS IF YOU ARENT NERVOUS AT ALL

Cristina Mariani is the co-CEO of Ban Vintners.
anyone at a business eventsay, a conferenceI

steer away from bigger groups and strike up a conversation
with two people who are already conversing. Theyre very likely
to welcome a thirdremember, everybody else is there to network as well. Then, if a solo person wanders by, Ill invite her in
and introduce her to the others. Its a good way to hear everyones name again.
The thing to remember is youre there to connectnot just
hand of business cards. I like to ask people about what they
do, because people like talking about what they know best. But
you can ask about their families, where they grew upwhether
its family, charity, or travel, the most important thing is to get
their story and hear their passions. Just put a time limit on it. If
somebodys eyes start to wander around the room or the conversation doesnt come easily, its time to excuse yourself.
If theres someone you came there to meet expressly, do
your homework. Find out their background and their interests.
Im honest about it. Ill say, I saw this great article about you.
Congratulations; can I ask you more? Most people are attered you took the time.
All in all, youve just got to have self-condence. It never
hurts to have a glass of wine in hand.
IF I DONT KNOW
HOW 22
TO BE
SMARTER
ABOUT
SPENDING
Alexa von Tobel is the founder and CEO of LearnVest.

I spend only money I know will move the meter for the business. I always
think, If I were paying for this out of my own wallet, would I buy it? That
one lter gives you your answer.
Thats not to say you should be as cheap as possible, but it helps you
focus on where youre actually making an investment. Give me the cheapest business card that exists, but get my team the best technology. Sure,
we could have free lunch ve days a weekor should everyone get an iPad?
Would you rather have random taco night, or would you rather have a
bonus? Its easy as a company gets bigger to spend, spend, spend, but
make sure where dollars go is where theyll have the biggest impact.
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STEVEN PUETZER/GETTY
20
What we do requires people who work

in strategy, user experience, design,
technology, and production. Traditionally, you departmentalize all that.
But I organize teams around clients,
not job functions. The half-life of
inspiration is very short, and if everyone whos working toward a common
goal is sitting together, problems get
solved quicker.
When you walk inside Big Spaceship,
youll see an open plan, with several long
tables. Each cross-disciplinary team is
organized along an aisle. The idea is they
focus outward and then just swivel their
chairs inward to collaborate. Even the
physical motions are meant to be as
frictionless as possible. There are also
guest stools in each row, tucked under
the ends of each table, so anyone can
grab one and pull it up.
We also try to give people lots of
mediums to express themselves.
Theres lots of graph paper, lots of
construction paper. Instead of whiteboards, the walls are covered in whiteboard painttheres something really
satisfying about writing on the wall. It
gets your inner child. There are also
private and semiprivate rooms, places
with couches and beanbag chairs,
for individuals or teams that want
some quiet.
We want to be the most collaborative agency in the world. So we try to
create as many opportunities as possible
for people to ofer a thought on the y.
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Nick Woodman is the founder and CEO

of the camera company GoPro.
KEEPING PEOPLE red up

starts with having a
really clear vision for what
the company is aiming to do.
Our mission is to make it easy for
people to self-document and share
meaningful life experiences. Youll
notice I didnt say we make cameras and camera mounts. As soon
as it becomes about the camera,
its rather limited; its about a device. Its like, Google didnt start by
saying, Were going to make a better search engine. They said,
We are going to organize the
worlds information.
The second piece is showing
people the tangible results of their
eforts. We have a bit of an advantage here, because its very easy to
illustrate the results, thanks to
Facebook and YouTube and all the
other social sharing of the content
people make with the cameras.
When a really killer video gets
shared around our ofce, were not
high-ving about, Dude, look how
great our camera worked! Were
stoked because you can tell from
the video how excited the customer
was. That goes miles in stoking our
work force.
The nal thing is to be as inclu-
Michael Fertik is the CEO

of Reputation.com.
You can walk around all day as the
CEO thinking youre not an intimidating person, but a lot of people,
especially those who havent
known you a long time, are
automatically intimidated by your
title or by the fact that you dont
talk with them every single day or
whatever it is. When you have a
strong personality, as I do, you
have to make sure you are not
intimidating people even more.
You can say until youre blue in
the face that you have an opendoor policy, but nobody ever takes
you up on it.
I try to combat that. Every day
or so, I ask someone in the company, What is the dumbest thing
you are working on? It accomplishes a few things. First, if I
think the project isnt actually
dumb, that usually means I have
done an inadequate job explaining how it relates to the larger
business, so I explain it a diferent
way. If I think it is kind of dumb
and we shouldnt be doing it, that
is of course also helpful. And the
question makes the open-door
policy real. It gives people a
comfort level to say something
they might not otherwise say.
25
sive as possible and make sure

the employees are having fun.
Here again, I think we maybe
have an unfair advantage, because
so much of what the company is
involved in is inherently fun. But
that wouldnt mean much if we
didnt take the opportunity to involve and include our employees in
the brand activitiesgoing to some
of the events that we sponsor, getting to go on lm shoots, interacting with pro athletes. Even if its not
an everyday thing, you want to
make sure people always have
something to look forward to.
Last year, when we launched the
Hero3 camera, we rented out the
Great America theme park for our
team and their families. Its going
to become an annual tradition. And
it allows employees to experience
some of the classic GoPro thrills
high speed, g-forces, being
strapped into a ride. They get to
lm the expressions on their faces
and do it with family members. If
you create those opportunities for
employees, they simply have more
fun working at your company.
Theyre happier, theyre in a better
mood, they are more productive. It
becomes a culture of positivity.
How to Handle Haters
The oxygen for trolls or haters on social media is an argument.

Thats why most people think the best way to handle them is to ignore
them. I disagree. The best way is to engage them, but with respect.
Acknowledge their point of view and start a conversation. Theyll
gain a lot of respect for your willingness to hear them out.
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FROM TOP: GETTY; JAKE CHESSUM
HOW TO GET
EMPLOYEES
TO OPEN UP
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27
HOW TO
FIX A
STRUGGLING
DEPARTMENT
HOW TO
LISTEN
REALLY
LISTENTO
EMPLOYEE
FEEDBACK
Doug Mack is the CEO of the

home-furnishings retailer One Kings Lane.
ANY BUSINESS HAS parts that are in really good shape,
where a manager only needs to do ybys. Then

there may be other parts that are in trouble, where
you need a deep dive.
To x a troubled department, I rst hold oneon-one meetings with the people on the ground.
I ask, How do you think were doing as a team?
What can we do better? How can I make you more
successful? We want to develop a baseline of
what were doing well and where there are gaps.
Then I pull together the departments leaders
and share the conclusions. I empower them to x
the problem. We develop a clear agendahere are
the things we are going to deliver and the processes
were going to x.
Any department thats struggling has a communication issue. So we create forums for better
communication. On our tech team, one of the
biggest pieces of feedback was that people didnt
know what the companys priorities were or what
their colleagues were working on. We created
what we call the MACK-1, a superfast 15- to
30-minute meeting we hold two to three times a
week for everyone to stand up to the mike. They
announce if theyve hired a new person, shipped
code, or anything else. Its an awesome way to
make everyone aware of whats going on but also
to make success about the collective strength of
the team and not just the person leading it.
If theres a governing idea here, it is that 100
percent of the answer lies in unlocking the talent
of the team. If youve done a good job bringing
people in, the vast majority of answers on how to
make them more productive, more successful, and
more happy are sitting right in front of you.
Most CEOs are fantastic sales people.

We have to sell people on working
for us, giving us money, our vision,
everything. So, early on at Rent the
Runway, whenever people would
give me feedback, my rst instinct
was to sell them on the idea that
their feedback wasnt true. Someone
would tell me, It was intimidating
when you did X, and Id say, It
wasnt intimidating; it was just Y.
All of a sudden, people were giving
me less feedback, and I had to
change that.
We started an anonymous employee survey. Every six months, we
ask about things such as employee
happiness and satisfaction with their
managers. We share the results of the
survey with the whole company and
create action plans to address the
feedback. In the last survey, for
instance, we realized there was confusion about our 2013 goals, even
though, as an executive team, we
thought wed done a great job broadcasting those goals. We took that
feedback, and at the next all-hands
meeting, we went through every goal
in detail and created a forum where
people could ask questions.
And personally, Ive gone from
never asking for feedback to asking
for it in every one-on-one I have. Then
I just listen. I do not respond. Instead,
I take actions to address that feedback, and, later, ask that employee if
my actions made a diference. Its
the follow-through thats so
critically important.
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BRUCE PETERSON/GALLERY STOCK
Jenn Hyman is the co-founder and CEO of

the fashion site Rent the Runway.
I believe GoToMeeting is really that key

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driver for successful collaborations.
Mindjet CMO
Jascha Kaykas-Wolff
Try it free for 30 days

gotomeeting.com
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28
HOW TO
ALWAYS BE
GETTING
SMARTER
Kunal Sarkar is the CEO of
Lumosity, a maker of braintraining video games.
As we do new things, we
always want to make sure

were doing things that help
the business and not hurt. We
may have a feeling of intuition
that something may be
successful, but how do you
really know?
We run experiments. For
example, maybe I believe
that emailing our users
about how fun our games are
will get them to train with
the games more. So, rst, I
set a benchmark. Ill measure
the average training time
with our current user emails.
Then, Ill split the users into
three buckets: One group will
get the originals, one will get
the fun games email, and the
rest will get an email that
references how the games
are backed by pretty hardcore neuroscience. Because
we have 40 million users, we
can run that experiment and
get valid data about which is
best in just a few months.
(As it turns out, users prefer
the science emails.)
This makes our decision
process really transparent. It
creates a merit-based culture.
What we decide is not about
title or rank. I cant just say we
dont do something because I
dont like it.
If you can run one small
experiment every week,
something tinychanging a
button on the purchase page,
sayand it makes the user
experience 1 percent better?
Over the course of the year,
youll improve by 70 percent.
Thats what leads companies
to double and triple sales
every year.
HOW TO BE
FUNNY AT THE OFFICE
In which Scott Adams, the creator of Dilbert, advises a hypothetical CEO on the ne art of workplace wit.
Im fairly condent that Im pretty

hilarious. But how do I make sure Im as
funny as I think I am?
If you really need to know how funny you are,

you could test your hilarity with someone who
doesnt depend on you for a paycheck. But that
might not turn out the way you hoped. This is
one of the many, many instances in which
ignorance is your friend. As things stand, your
subordinates laugh like inebriated chimps at
everything they hope is meant as a joke. That
articial approval makes you feel like a superstar, and it makes your subordinates happy,
because fake laughing is easier than working.
Its a perfect system. I wouldnt peel back the
layers on that onion.
I would like to showcase my sense of humor

at the ofce. What are the best opportunities
for doing so? Im guessing downsizing
announcements are not ideal.
Theres no better time for humor than when

youre criticizing a subordinate. Humor can
lighten the mood in what might otherwise be a
tense situation. When you criticize subordinates in a boring and normal way, you end up
with crying, shouting, and sometimes violence.
But if you whimsically compare your inefective subordinate to a nutless squirrel with a
learning problem, the situation quickly turns
to laughs, hugging, andwith a little luck
inappropriate touching.
Is it better to be funny about stuf thats specic

to the workplace, or can I be more broadly humorous? I have material I worked up for Toastmasters
last year that most people here havent heard.
People prefer humor they can relate to. For

example, if you tell a funny story about the time
your personal chef fell of your yacht and you let
him drown because you didnt feel like going
back, your employees will nd that relatable. At
least from the chefs point of view.
I worry about making a joke that might

ofend somebody. How can I be both hysterical
and politically correct?
Its perfectly acceptable to tell ofensive jokes at

work, as long as you add to the end of each one,
Ha ha! Its OK, because I dated one in college,
or Ha ha! Its OK, because I tried it once at
summer camp. That covers most bases.
I am, by nature, a strategic thinker. How can I think

strategically about deploying my humor?
That is an excellent question, because humor

without strategy is like a pair of mittens with no
user manual. Its all trial and error and tears.
Thats how accidents happen.
Humor cant be randomly sprayed into the
universe with no thought of an endgame.
Humor requires a strategy that connects your
wittiness with your long-term goals. For example, one long-term goal might involve trying
to appear somewhat human, for reasons that
are not immediately obvious. Or maybe you like
to use humor to belittle subordinates so you can
enjoy the warm glow of your own arrogance.
There are plenty of good reasons for a CEO to be
funny. You just need to pick one.
How can I be sure my employees are

laughing with me, not at me?
You dont need to live in doubt. The best strategy is to laugh at them rst. As soon as you
deliver your punch line, point to the weakest
nearby person and yell LOSER! then laugh as
if there are kittens in your underpants. I dont
know exactly what your employees will be
doing at that point, but it probably wont
involve laughing.
Scott Adamss new book, How to Fail at Almost Everything and Still
Win Big: Kind of the Story of My Life, was published in October.
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street smarts
Norm Brodsky
The Perils of Success

No one wants to fail. But the
toughest challenges emerge
when you achieve your goal,
not when you fall short
owned 42 percentprior, that is, to their all

being diluted by the two new shareholders.
(after that, the three original partners share
would total 55 percent.)
alex was concerned about the deal with the
restaurateur. He worried that the guy wouldnt
do what hed promised and the partners would
wind up giving away 20 percent of the company
for nothing. I didnt see that as a big problem,
ve NotIced a pattern among entrepreneurs who come to
provided they made the stock grant conditional on
me for advice: they are almost always concerned about
achieving certain well-dened objectives within a
the wrong thing. they worry, for example, that a plan of
given period of time. alex said they had a plan
theirs will fail, when they should be focusing on the
that would unfold in four stages; the restaurateur
much larger problems theyll face if it succeeds.
would get the stock only after completing the rst
Consider a young man well call alex, who contacted
three. OK, I said, but you need to include time
me recently about plans he and two partners had for a
limits. then, if he doesnt deliver, youll be out
chain of 12 restaurants selling empanadas, the Latin
some time and money but nothing more.
american stufed pastries. the partners already had one
then I asked alex a question: What if the ressuccessful restaurant. Now they wanted to franchise
taurateur does deliver but the company doesnt
the concept. toward that end, they were bringing in a restaurahave enough capital to nish the job? the
teur who had a chain of empanada restaurants in argentina. He
$300,000 investment didnt seem nearly enough to
would receive 20 percent of the stock for his help.
set up a chain of franchises. Granted, the company
In addition, the father of one partner had agreed to invest
will have some additional cash ow after the part$300,000 in exchange for a 25 percent stake. His son was the
ners begin selling franchises, but with legal costs,
only partner working in the restaurant. the other two, including
marketing costs, travel costs, administrative costs,
alex, had full-time jobs elsewhere. accordingly, they owned less
and other costs they hadnt anticipated, they could
of the company, 29 percent each, than the working partner, who
soon nd themselves needing a lot more capital.
With a small company and few personal assets,
theyd have a tough time getting a bank loan. that
would mean another equity investment, which
Norm Brodsky is a veteran entrewould mean further dilution. as it was, alexs share of the business would be down to about
preneur. His co-author is editor-at16 percent after the restaurateur and the investor are given equity. the next round of capital
large Bo Burlingham. They also
are co-authors of Street Smarts:
would leave him with a much smaller percentage.
An All-Purpose Tool Kit for Entreprethe best solution, I suggested, would be for the father to invest the $300,000 and agree in
neurs. Follow them on Twitter at
@normbrodsky and @boburlingham.
advance to loan the company whatever additional capital might be needed. He is the ideal lender,
in that his son will own 23 percent of the business by then, and so together, theyll have 48 percent, which gives them efective control. they will thus have an overwhelming interest in making
sure the company doesnt failwhich would also be good for the minority shareholders like alex.
my point was that rather than worrying about the restaurateurs not performing, alex and
his partners should be focusing on getting the nancing they need to succeed. People can be
replaced relatively easily. Coming up with capital in a pinch is much, much harder.
evaN kaFka
ScaN tHe page to See Norm aNSwer aNotHer queStIoN from aN eNtrepreNeur. (See page 10 for details.)
Do you have a question for Norm? Write to him at AskNorm@inc.com.
68 - iNc. - NovemBer 2013
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How to turn customers into designers PG. 72
Inside a factory makeover PG. 76
Design.
Craft.
Excellence.
The process of
making chocolate
has become hugely
industrialized.
Were doing it
all by hand.
RICK MAST, co-founder
of Mast Brothers
78
PG.
BEAN TO BAR
Mast Brothers ofers a
rotating selection of
artisanal chocolates in
colorful, graphic packaging.
PHOTOGRAPH BY CRAIG CUTLER
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NOVEMBER 2013 - INC. - 7 1
Tip Sheet
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Do-It-Yourself Design
A few innovative makers are
letting customers design
their own goods. Heres how
you can do the same
JODIE FOX LOVED SHOES but could never
nd just the right pair in stores. So, during trips to China, Fox, then an advertising executive, carved out time to meet
with a shoemaker, who created bespoke
footwear according to Foxs designs.
When Foxs friends began asking her to
place orders for them based on their own
designs, she knew she was onto something. In 2009, Fox co-founded Shoes of
Prey, an e-commerce site that lets customers design shoes from heel to toe.
Shoes of Prey is part of a new breed
of businesses that is taking product
customization to the extreme. Thanks to technological advances, including 3-D
modeling and printing, you
On the Shoes of Prey website,
can let customers design
customers start by choosing
products from scratch.
from a selection of 16 basic
Meanwhile, the maker
womens shoe styles and 150
movement has inspired
materials in various colors.
people to seek out DIY
Then, they select from a variety
tools, says Rama Chorpash,
of options for the toe, sole, heel,
director of product design
accents, and other variables. The
ONE STEP AHEAD
Do-it-yourself shoe
at Parsons the New School
shoes, which range from $129 to
maven Jodie Fox
for Design in New York City.
$199, are then handmade in a
People will be happier with
factory in China and delivered
fewer things when they have a
to customers in four weeks.
memory of making them, says
The concept has been a hit with
Chorpash, who designs furniture
customers looking for footwear thats
and home accessories.
an expression of themselves, Fox says.
Shoes of Prey, which is based in Sydney,

Australia, has sold roughly 20,000 pairs
of shoes in the past four years and raised
$3 million in funding from U.S. and
Australian investors. The company,
which has almost 50 employees, recently
opened a physical store in Sydney where
customers can try on basic styles, see
fabric swatches in person, and design
shoes on iPads with help from in-store
designers. Here, Jodie Fox and her cofounder (and ex-husband) Michael Fox
ofer their tips for successfully employing an open-ended design model.
JOHN BRANDON
Lets Get
Personal
A look at four
companies that
pioneered product
customization in
the past century
7 2 - INC. - NOVEMBER 2013
Sherwin-Williams
A panoply of paint colors
Debut: Early 1941

Sherwin-Williams introduces a
latex house paint that can be
blended to create custom colors.
Prior to this, ready-mixed house
paints were oil based and came in
a limited number of colors. The
Cleveland company generated
$9.5 billion in sales last year.
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Levitt & Sons

Custom homes for all
Debut: 1951
Levitt & Sons pioneers the low-cost,
mass-customized home industry,
allowing buyers to choose among
several models with custom features. The business, best known as
the builder behind Levittown, New
York, closed in 2009 after the housing market crashed.
SPREAD: CLOCKWISE FROM LEFT: COURTESY COMPANY (2);

COURTESY DAVID GRAAS; ALAMY; TONY LINCK/GETTY
IF THEY BUILD IT...

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Open-ended design isnt just

WELL HEELED
A sampling of footwear
designed on the Shoes
of Prey website
for shoes. These businesses let

customers create what they
buy in three other markets.
TECH ACCESSORIES
Last November, San Franciscobased
Dodo Case launched an online tool that
lets customers create custom cases for
tablets and smartphones. You can
choose from among more than two
million combinations of materials and
add embossed messages and names.
The cases, which are made in a San
Francisco factory, cost $45 to $150.
They now constitute 30 percent of
Dodo Cases online sales.
3-D PRINTED OBJECTS
Shapeways makes it possible to create
designs for a wide variety of metal,
plastic, and ceramic objects using 3-D
software on its website. The company
then manufactures the objects using
3-D printers in its New York City factory.
It has 350,000 registered users.
INVEST IN TECH,
SLOWLY
Developing photorealistic design software thats easy for
customers to use has
been key, Michael says.
But sophisticated
software is pricey. The
Foxes launched their
site with a basic 2-D
design tool. After they
began to generate
sales, they invested in a
souped-up 3-D tool,
which took seven staf
engineers and three
consultants nine
months to create. All
told, they have plowed
about $1 million into
the tool, which is in its
third iteration.
EMBRACE LEAN
MANUFACTURING
Finding a skilled
manufacturer that
wont break the bank
is also crucial. The
Foxes spent two
months touring
factories and
commissioning test
shoes before deciding
on a facility in Guangzhou, China. The
15-employee factory
uses lean manufacturing techniques, such
as stocking a minimal
amount of material,
that keep costs low.
As a result, Shoes
of Prey has a 50
percent gross margin
on each pair.
OFFER A GENEROUS
RETURN POLICY
You might be tempted
to adopt a strict return
policy for customdesigned goods. Shoes
of Prey has taken the
opposite approach,
allowing customers
to return unworn shoes
within 365 days of
receiving them. The
reasoning: Customers
without design experience will feel more
comfortable trying out
the site if they know
they have plenty of
time to return their
shoes, Michael says.
So far, the site's
return rate is a
modest 16 percent.
PROVIDE STELLAR
CUSTOMER SUPPORT
Customers can call,
email, or chat online
with Shoes of Preys
seven customer
happiness wonderpeople, each of whom
has completed a rigorous shoe design training
program. The online
store also features more
than 50 how-to videos
on a variety of topics,
including designing
wedding shoes and
working with snakeskin.
The high-touch strategy
is paying of: Eighty
percent of customers
have given the design
process a rating of nine
out of 10 or 10 out of 10.
Dell
Personal(ized) computers
FURNITURE
Avant-garde Dutch designer David Graas
recently unveiled Everything But the
Manual, a $150 kit that lets you build
furniture and accessories (including the
basket shown below) using 32 identical
oak building blocks, along with nuts and
bolts. Theres one thing missing:
instructions. Graas hopes the kit will
inspire ingenuity among buyers. Its a
challenge, Graas says. You have to use
your brain. JENNIFER ALSEVER
Mini Cooper
Just call it Mini Me
Debut: 1985
Dell advertises its rst computer, the Turbo
PC, in national computer magazines, ofering
consumers a limited number of custom features. Then, it builds each computer to order.
Though Dell, which is based in Round Rock,
Texas, has struggled to maintain its leading
position in the PC market, the company is still
considered a pioneer of custom computers.
Debut: 2002
Minis online tool lets you create
a customized car from among 10
million possible combinations,
blowing away the competition.
You can choose from a variety of
body styles, interior surfaces, and
roof graphics. Today, 33 percent of
Minis are custom designed.
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MADE
making it
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How to really
Jump-start made
in america
Government initiatives to boost
manufacturing ignore small business.
Heres a better solution
74 - inc. - NOvEMBER 2013
UPGRADE
OUR PORTS
To attract more manufacturers,
America must revamp its ports, says
Willy Shih, a professor at Harvard
Business School and co-author of
Producing Prosperity: Why America
Needs a Manufacturing Renaissance. Even a small backwater on
the Pearl River Delta in China will
have a larger or more efcient
container port than the one here in
Boston, Shih says. This summer
marked the maiden voyage of the
1,312-foot-long Maersk Triple-E, the
worlds largest container vessel,
which can carry about 9,000 40-foot
containers. Do you know how many
U.S. ports can handle a Triple-E
ship? Shih asks. Zero.
With a $5 billion upgrade set to
double the capacity of the Panama
Canal by 2015, more container ships
will soon be reaching U.S. shores.
Many ports are scrambling to
dredge deeper shipping channels,
install larger cranes, and boost
overall capacity. Ports need help in
the form of more public and private
investments and streamlined
regulatory processes, Shih says.
Obama has signed an executive
order expediting federal reviews of
several infrastructure projects,
including deepening the harbor in
Jacksonville, Florida. But more ports
need federal attention.
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TRAIN A NEW GENERATION

OF FACTORY WORKERS
Technological advances, including
3-D printing and robotics, are
increasing the need for manufacturing workers with serious skills.
In a 2011 Manufacturing Institute
survey, 67 percent of manufacturing executives reported a worker
shortage. The Advancing Innovative Manufacturing Act, a bill that
would authorize grants for manufacturing programs in community
colleges, is being reviewed by a
congressional committee. Similar
legislation died in committee last
year. Educators arent waiting
around: North Carolinas Central
Piedmont Community College, for
instance, has partnered with
BMW, Siemens, and other rms to
provide students with specic job
skills. Despite advances in automation, you cant have world-class
manufacturing without worldclass workers. JESSICA BRUDER
KATIE EDWARDS
N AUGUST 2012, the future of manufacturing

arrived in Youngstown, Ohio. Or, at least, that
was the U.S. governments plan. the city is home
to the national additive manufacturing innovation institute, a federally funded research and
development facility focused on 3-D printing.
in the past year, the institute has signed up about
80 members and selected seven projects to
receive $4.5 million in funding.
the institute is also a prototype for the national
network for manufacturing innovation, the cornerstone
of President Obamas plan for resurrecting the U.S. manufacturing industry. Since august, Congress has been
considering the Revitalize american manufacturing
and innovation act, which would authorize funding for
a network of up to 45 research and development hubs.
the innovation hubs make for a great sound bite. But
small businesses are being left out of the process. the 3-D
printing institutes 80 members consist mainly of large
companies and universities, and the board is dominated
by Raytheon, northrop grumman, Lockheed martin, and
other huge corporations. Dale Dougherty, co-founder of
OReilly media, publisher of Make magazine and creator
of maker Faire, says the lack of small-business participation was apparent when he visited the facility in august.
it felt like more of an alliance of the industrial market,
Dougherty says. it would be like iBm and Digital getting
together in the 80s and leaving out apple and microsoft.
One possible reason is the price tag: the institutes
annual membership fees range from $15,000 to $200,000.
theyve already priced me out of coming back, says
Jason gromek, founder and president of BioDevice Design, a design and engineering rm in Brecksville, Ohio.
Because gromeks company helped establish the institute,
his membership fees were waived for one year. gromek
had no plans to renew his membership when it expires
this fall. im a small, dynamic company, gromek says.
But this isnt tailored to small companies.
the U.S. manufacturing sector is showing signs of a
rebound, sparked by rising production costs in China and
increased demand for U.S. goods. Uncle Sam could have a
role in helping to further the U.S. manufacturing renaissance, but it should eschew photo ops in favor of practical
steps that benet makers of all sizes. Here are two.
made
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produCTIoN lINeS
InsIde a factory makeover

How Filson created a production facility
as fresh as its hip appareland boosted
luggage output 50 percent
Illustration by Bryan christie design
n 1897, C.C. Filson began supplying outdoor gear to gold prospectors passing through Seattle
on their way to Alaska. Filson
has kept up with the times since
then. Its apparel line is popular not
only with outdoor enthusiasts but
also with hip city dwellers. Filsons
aging factory, on the other hand, was
a diferent story. So, starting in 2012,
the 240-employee company, which
is owned by private equity group
Bedrock Brands, teamed up with
design consultants to create a facility
that emphasized transparency and
productivity. Since Filson moved to
the new 57,400-square-foot building
this spring, luggage output has
increased by more than 50 percent.
When you feel better about your
workspace, you just perform better,
says Filson quality manager Teresa
Whittaker. This graphic highlights
the changesboth big and smallthat
made a diference. NAdINe HeINTz
Workstations
Break room
no more eating at
the workstations
The kitchen in Filsons old factory
was cramped and featured only two
small tables. As a result, most of
the companys 100 or so production
workers ate lunch at their workstations. The new facility has a spacious
break room with several tables, an
array of appliances, and lockers for
storing personal belongings. Now,
people get an actual break at lunchtime, says Whittaker, who has
worked at Filson for 21 years.
a comfy chair goes a long way
smooth operator
In the old facility, workstations

consisted of mismatched tabletops
held together with duct tape. The
new stations feature two tables
with matching gray laminate tops,
an adjustable LED lamp, and a
specialty sewing chair with a
padded seat and back (the old
chairs were wooden).
Prior to the move, workers transported

bundles of material from one workstation to
the next in unwieldy industrial carts that were
large and deep, requiring workers to bend
down to retrieve items. Now, bundles move
on rolling carts with a shelf. Workers can
grab and replace bundles on the shelf while
seated, which saves time and cuts down on
physical wear and tear.
76 - Inc. - NovEmbEr 2013
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corporate offices
show and tell
The corporate ofces at Filsons old

location were crowded and rundown. The
second, third, and fourth oors of the new
headquarters feature an open-plan ofce
with 125 desks and workspaces and
enough room for ve product showrooms.
production floor
going with the ow
The production oor is more than

12,000 square feet larger than
the previous one. It is broken into three
departments, each of which includes
roughly 32 workstations and focuses on
making 10 types of products at any
given time. Previously, workstations
were organized by machine. Now, they
are arranged according to the ow of
the production process, represented at
left by the colored arrows: Each bundle
snakes up and down the aisles seamlessly rather than moving across the
room between steps. It saves a huge
amount of time, and nothing gets lost,
Whittaker says.
loBBy
Zen and the art of manufacturing
Transparency was a key part of Filsons vision

for the new building, says CEo Alan Kirk. The
lobby features two walls of windows that look
directly onto the production oor. The windows
were originally designed to give visitors a peek
at the manufacturing process. Production
workers also like looking out at the serene
lobby, which includes a rock garden, plants,
and a grand staircase. They tell me its like a
Zen garden, Whittaker says. All those rocks
have a calming efect.
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finished product
in the bag
Filsons original briefcase, which is

made of twill and leather and costs
$248, goes through 69 production
steps. Each bundle of 11 bags spends
from three minutes (placing snap
components on luggage aps) to 30
minutes (assembling shoulder pads)
at a station. Its very physical,
Whittaker says. Youre always
pushing or pulling the leather. The
last step: a 38-minute inspection.
made
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best in class
the Wish List
Great gifts made by entrepreneurs

In our minds at Inc., this is clear: The best gifts
are ones made with passion and pridewhich
generally means that theyve been made with
the company founder close at hand. To that
end, weve rounded up four extraordinary,
innovative products that could have come only
from entrepreneurial makers. Any or all would
make great presents for the people on your
holiday list, including your favorite client
(handcrafted chocolate) and an adrenalinejunkie relative (a wearable sports camera).
Photographs by Craig Cutler
78 - inc. - november 2013
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the Zulus glow doesnt just
improve safety. it also
illuminates the artful,
iconic shape of the bicycle.
Zach Schau
NigHt riDer
Forget about reectors. The Zulu
bike from Pure Fix cycles is coated
with weatherproof, phosphorescent
paint activated by sunlight. Ride it
(or park it) for one hour in direct sun
for an hour of glow-time after dark.
The $399 xed-gear bike has a frame
of high-tensile steel and 700 x 28
tires designed for speed and comfort
in urban settings. as a college student at the university of Wisconsin,
Madison, Zach Schau noticed more
people riding xed-gear bikes, or
xies, which appeal to cyclists looking
for a simple design and low maintenance. after graduating in 2010, he
founded Pure Fix cycles with two
former classmates and his brother.
The 18-employee company, which is
based in Burbank, california, generated $4 million in revenue in 2012.
It sells a variety of xed-gear bikes
and accessories on its website
and at more than 400 independent
bike shops around the country.
adaM BaeR
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made
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SOUND CHECK
theres no shortage of fancy
headphones on the market.
But lStns Cherry Wood
troubadours stand out from
the pack. the $150 headphones feature cherry wood
casing reclaimed from ooring and furniture companies,
and a gold-plated plug. And,
for each purchase, lStn
makes a donation to the
Starkey Hearing Foundation,
which provides hearing aids
to people in need around the
world. Music lovers Bridget
Hilton and Joe Huf founded
lStn in West Hollywood,
California, last year. the
company now sells headphones and accessories
online and in stores around
the country, including
Fred Segal and independent
record shops. A.B.
I looked around at my
piano, guitar, and all
of my instruments,
and they were all
made of wood.
I couldnt think of
a better material
for headphones.
Bridget Hilton
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made
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Finally,
a cloud of your own.
Save everything. Access anywhere.
My Cloud
Personal Cloud Storage
You know every photo or video is worth saving. With My Cloud,

every precious moment stored on your computers, tablets and
smartphones is automatically and securely backed up to one
central place in your own home. And its all instantly accessible
from anywhere, on any device, anytime. wd.com/mycloud
Western Digital, WD and the WD logo are registered trademarks of Western Digital Technologies, Inc. in the U.S. and other countries; My Cloud and absolutely are trademarks of Western Digital Technologies, Inc.
in the U.S. and other countries. Other marks may be mentioned herein that belong to other companies. Product specications subject to change without notice. Picture shown may vary from actual product.
2013 Western Digital Technologies, Inc. All rights reserved.
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Sugar ruSH
Rick and Michael Mast made
chocolate as a hobby until
2007, when they quit their day
jobs (Rick was a chef, and
Michael was in nance) to
open Mast Brothers in Brooklyn, new York. Today, the
brothers and their 35-person
staf handcraft organic,
artisanal chocolate bars
in their 2,500-square-foot
factory in Brooklyns
Williamsburg neighborhood.
The bars are made from
organic beans sourced from
Madagascar, Belize, Papua
new guinea, and the dominican Republic and shipped to
the u.S. by sailboat. Yes,
sailboat. They are available
at mastbrothers.com and in
specialty stores worldwide
for about $10 each.
aBIgaIl TRacY
We are making chocolate on

a human scale, constantly
tasting it every step of the way.
rIck mAsT
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made
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No two employees
are alike
They need benets that
t their lifestyles
With Unums full range of
nancial protection benets
You can provide the right
solution for everyone
Your workforce is made up of unique individuals. Different ages. Different incomes. Different
benet needs. With Unums broad array of benet choices, you can build a comprehensive
plan that helps employees protect what matters to them. Supplement your medical plan with
accident, critical illness or hospital indemnity benets. Provide additional disability coverage
to protect more income. Or share funding to offer more coverage for less. Better choices
mean better benets for all. To learn more, visit unum.com/betterchoices.
DISABILITY LIFE ACCIDENT CRITICAL ILLNESS HOSPITAL INDEMNITY

2013 Unum Group. All rights reserved. Unum is a registered trademark and marketing brand of Unum Group and its insuring subsidiaries.
Insurance products are underwritten by the subsidiaries of Unum Group. NS13-204
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With goPro, you are part
aCtiON Star
designed for extreme
shooting, the goPro
hero3+ Black edition
features a new wide-angle
video mode and 25 percent more battery life than
its predecessor. The $399
unit weighs 1.4 pounds
and includes a 3.9-inchsquare waterproof case, a
mount, and a three-way
pivot arm. nick Woodman
was inspired to create a
wearable sports camera
during a surng tour of
australia and Indonesia.
In 2002, Woodman founded goPro in half Moon
Bay, california. The
560-employee company
now sells cameras,
mounts, and other
accessories worldwide.
of the content. You get to

see yourself having
the experience, which
is surprisingly rare.
nIck WoodMan
nadIne heInTZ
S C a N t H i S Pa g e t O Wat C H v i D e O S S H O t W i t H g O P rO C a m e r a S . (See page 10 for details.)

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made
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MADE SMART
mark dwight
Sustainability Without
the Sanctimony
We all know sustainable
manufacturing is good for
show. Heres how we make
it work for the bottom line
form, function, and footprint. We pride ourselves

on making high-quality products for long-term,
everyday use. Some sustainable fabrics wear out
too quickly to meet our standards. For instance,
we tried making bags with beautiful (and expensive) Italian wool herringbone tweed, only to have
the prototypes wear out in weeks. So we partnered with one of the few remaining upholstery
mills in North Carolina to develop a proprietary
collection of Rickshaw Performance Tweed:
was Introduced to the concept of sustainable design while
a gorgeous, rugged fabric made from recycled
attending a TED conference in Monterey, California, in 2005.
beverage bottles and nished with an eco-friendly,
During one presentation, William McDonough described the
stain-resistant coating. With a little extra efort,
principles outlined in his book, Cradle to Cradle: Remaking the
we developed a fabric that met our goals for
Way We Make Things, which he co-authored with Michael
sustainability, style, durability, and afordability.
Braungart. In the book, the authors argue that products
We also strive to reduce waste in every aspect
should be designed in a way that allows their constituent
of our business. To that end, our Zero Messenger
materials to be innitely recovered, recycled, and recombined
Bag collection is designed in a way that lets us use
into new products.
every part of the fabric that we cut to make each
McDonoughs presentation had a profound efect on my
bag. All of our bags are built to order in our San
approach to manufacturing when I founded Rickshaw Bagworks in
Francisco factory. As a result, we eliminate the
2007. Since then, a lot of businesses have realized that sustainable
waste that results from overstocking and disposing
practices can help save money and strengthen brands. In fact, there
of unpopular and seasonal styles. Because most of
has been an explosion of marketing hype for so-called green prodour business involves selling directly to customers
ucts and eco-friendly business practices. As business owners, we
through our online store, rather than through
should set aside the promotional gimmickry and focus on making
retailers, we have virtually eliminated the need for
sustainability a core value. At Rickshaw, we have developed several
hang tags and wholesale brochures. We dont send
guiding principles for doing so.
print catalogs to consumers, and our packaging is
We embrace what I call the three f s of sustainable design:
designed to convey only essential point-of-purchase information, without wasting paper on
words that few people ever read (or would just as
likely seek out on the Internet). Were even experimenting with ways of replacing shipping boxes with reusable fabric pouches.
Mark dwight is the founder of
Rickshaw Bagworks, a San Francisco
The best way for many manufacturers to shrink their environmental footprint is to focus
maker of custom bags, and SFMade,
a nonprot focused on building the
on reducing the amount of transportation required to obtain parts and materials. At Rickshaw,
citys manufacturing sector.
we work with local vendors for a variety of outside services, including screen printing and
embroidery. In fact, we make many of our vendor visits by bicycle. We purchase roughly
70 percent of our parts and materials from domestic sources, and were working to drive that
number to 100 percent. We believe that any additional incremental expenses that result from
sourcing domestically will be ofset by operational efciencies and positive brand equity.
Sustainability is a journey, not a destination. Once you embrace the fact that sustainable
business practices save money, simplify operations, and build brand equity, you will continually
seek new ways to embrace them. At the same time, you will be making things better for the
environment and for future generations. After all, sustainable business is just good business.
86 - inc. - NoveMBeR 2013
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made
Cody PiCkeNS
P R O M OT I O N
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Ideas.
Breakthroughs.
Disruption.
I always
thought, Boy,
as big as you
are today,
you may be
history
tomorrow.
SAMMY HAGAR,
rocker and founder of a tequila
brand, a rum company, two
restaurant chains, and more
98
PG.
JIM STEINFELDT/GETTY
BLOND AMBITION
Hagar, onstage with
former bandmate Eddie
Van Halen in 1988
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Tip Sheet
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Lights,
Camera,
Action
Want to build your
social-media following?
Get visual
forget aBout 140 CharaCters. Increasingly, photos and videos are driving
customer engagement on social media.
On Facebooks top brand pages, videos
are shared 12 times more often than text
and links, and photos receive twice as
many likes as text updates. Meanwhile,
Instagram is growing faster than Facebook did. And Pinterest now refers more
trafc to outside websites than Twitter.
To churn out visuals that can engage
customers in this new social-media era,
many companies have had to create their
own mini studiosand assign employees
additional roles as staf photographers
and videographers. At Jenis Splendid
Ice Creams in Columbus, Ohio, a
2,000-pound delivery of summer strawberries draws a small army of socialmedia paparazzi. The companys visual
lead (a.k.a. staf photographer) hops
around snapping lush, sunlit shots and
shooting HD video of the haul. Within
days, that content will be curated, edited,
and posted on Facebook, Pinterest,
Tumblr, Vimeo, and the company blog.
Other staf members use their smartphones to shoot close-ups of a tray of
berries to post to Instagram.
on instagraM
on ViMeo
Most of the pictures on Jenis Instagram

feed are quick snapshots taken by staf members
using their smartphones.
This is where Jenis posts its slickly edited videos,

with music and graphics. Most videos are a minute
or less and get cross-posted to YouTube.
At Threadless, a Chicago company

that sells products designed by a community of artists, three marketing
employees and a multimedia specialist
each take a platform: Facebook, Tumblr,
Vine, and Instagram. They primarily
rely on iPhone cameras and Adobe
Premiere, editing software that sells
for less than $1,000.
These social-media channels allow
a company to live its brand, not just talk
about it, says Paul M. Rand, CEO of
Zocalo Group, a social-media marketing

agency. For Jenis, that means portraying a company dedicated to sourcing
farm-fresh ingredients such as sweet
corn and black raspberries. What sets
us apart is how we make our ice cream
and the ingredients we use, says Ryan
Morgan, Jenis social-media director.
We could post pretty pictures of our
ice cream all day long, but that does
nothing to diferentiate us.
For Threadless, the visuals often
Want to make the most

of your Instagram and
Pinterest accounts?
Try these smart new tools
for visual social media.
90 - INC. - noVEMBEr 2013
Best for: Mass publishing
Brandcast
What it does: Brandcast is sort of like a HootSuite for
visual social media. Snap a picture or shoot some video, and you
can publish it to Facebook, YouTube, Vimeo, Twittereven Etsyfrom
a single platform. Brandcast also includes analytic tools.
Cost: Free for the rst 1,000 beta users, then about
$5 to $10 a month
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SprEad: kElSEY McclEllan/courTESY JEnIS

SplEndId IcE crEaMS (8); courTESY MIcHEllE pHan;
IlluSTraTIonS: HIEronYMuS
VIsuAls gO VIrAl
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How three innovative
companies get results

with visual social media
a store Powered by Youtube

Known for her makeup tutorials,
Michelle Phan is one of YouTubes
biggest stars, with some 4.9
million subscribersmore than
Lady Gaga. In August, Phan
teamed with LOral to launch a
makeup lineem
michelle phan.
Customers are
encouraged to
upload their own
makeup videos on
ems website. In
the future, they
will also be able
to lm and upload videos inside
ems retail store, which launched
this fall in New York City.
Plucking the Vines
on Pinterest
on tUMBLr
In addition to its own product shots,

Jenis uses Pinterest to showcase photos
taken by customers.
This feed is a grab bag of snapshots,

videos, andmost important for
Tumblranimated GIFs.
showcase the companys connection to

artists or tie existing products to something happening in pop culture, such as
a particularly riveting episode of Homeland. Its about keeping your brand
relevant to whats happening in the wider
world, says Threadless marketing
coordinator Kyle Geib.
Companies are careful not to appear
overly promotional. At Poler, a Portland, Oregon, outdoor gear retailer, all
the images posted to Tumblr radiate
the youthful, free-spirited ethos the

brand embodies. One shot shows three
pairs of legs in front of a campsite
male legs in the middle, female legs on
either sideall wearing hiking shoes,
Poler socks, and possibly nothing else.
Co-founder Benji Wagner is cautious
about coming across as less than authentic to the platforms young users.
But anytime you can sell where people
are, he says, thats a good thing.
RyAn UndeRWOOd
Vacation rental service Airbnb

partnered with up-and-coming
director Miles Jay to create a short
lm out of six-second Vine videos
crowdsourced via Twitter. More
than 750 people submitted videos.
The result, Hollywood & Vines, is
a 4.5-minute visual journey of a
paper airplane traveling the globe.
It quickly racked up more than
150,000 views when it debuted
on YouTube in September.
from Pinterest to Product

The Grommet, which markets
and sells products from small
companies and inventors, uses
Pinterest to help determine which
products to promote online. Entrepreneurs submit pictures of their
inventions to an online gallery,
where customers can pin them,
tweet them, or post them to
Facebook. If an item gains
traction, the Grommet will sell it.
Best for: Tracking engagement
Best for: Selling products
Piqora
BlkDot
What it Does: Piqora tracks the most popular (and

protable) images your company posts on Pinterest,
Instagram, and Tumblr, providing metrics such as revenue
per pin. It also identies your most inuential followers.
Cost: Annual subscription fees range from
about $3,000 to $15,000.
What it Does: Posting product shots? BlkDot

lets you embed a subtle black Buy button on
Tumblr photos. (You can cross-post the link to
Facebook and other platforms.) The technology
works with Stripes payment-processing service.
Cost: 3 percent of each transaction
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INNOVATE
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DISRUPTER
Combining
the Wisdom
of 48,000
Doctors
HealthTap brings the

exam room to patients
smartphones
T
As told to DARREN DAHL
anyone who has Googled his medical symptoms

can attest. (Sore throat? Might be a cold. Or it
might be thyroid cancer.) Plus, its not always
clear who is serving up those diagnoses and
remedies. Thats why Ron Gutman created
HealthTap, an app that lets people pose medical
questions to real doctors. Since the Palo Alto,
Californiabased company launched in 2010, HealthTaps growing
community of more than 48,000 physicians has answered nearly
one billion questions. Eventually, says Gutman, HealthTap could
reduce the cost of health care by eliminating unnecessary doctor
visits. Recently, Gutman spoke with Inc. about how he got started.
I wanted to change
health care.
I got interested in health care in 2003 as a
graduate student at Stanford Universitys
business school. I was part of an interdisciplinary group of students and faculty that developed new ways to get people to engage in
improving their health. We used technology
such as an online health risk assessment tool
and cell-phone reminders to help people manage their health better.
After I graduated, I dove deep into the consumer health market. I startedand eventually
solda company called Wellsphere, which pro-
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INNOVATE
PHILLIP TOLEDANO/TRUNK ARCHIVE
HE INTERNET IS A hypochondriacs nightmare, as
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EXPERIENCE THE INTERSECTION

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Paul Mitchell Systems
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ZenBanx, Inc., ING DIRECT, Canada and USA
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The New
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House Call
ads, we would have been protable already.

but I wanted to build a platform for delivering reputable care. You dont see consumer
ads when you go to a clinic or a hospital.
We could save
billions of dollars.
People are sick of waiting.

Using the word patient to describe someone
with a medical condition is problematic,
because if you are sufering from physical or
emotional pain, the last thing you are is
patient. but patients are forced to have
patience and sit in waiting rooms. thats a
very strange thing for a service industry. Why
is it that the customer always comes rst,
but a patient is someone who can wait?
often, people end up waiting for days
until they can get an appointment to see
their doctor. So they go online and spend
hours trying to nd the answers. Its like
going to your doctor and having him give you
a bunch of articles to read. my goal was to
give people answers in the moments when
they were in the most pain.
I wanted healthtap to be free and simple
to use. After you sign up, you can submit
questions online or via the app. In just a few
minutes, youll receive answers from real
doctors all over the country. You can also
search through the questions and answers
submitted by other users.
Each doctor gets a score.

I brought on two other co-founders, people I
have known for a long time. Sastry nanduri
is a technologist, and Geof rutledge is both
a physician and a data scientist.
We started in 2011 by approaching a
small group of doctors: pediatricians and
obstetricians in the palo Alto area. We
connected them with pregnant women
and new moms and created a place where
they could come together and interact.
now, we have doctors in more than 3,100
cities across the country who cover 137
health specializations.
doctors have to apply to join our network.
We have strict guidelines about whom we
accept. We have rejected hundreds of physicians who have faced disciplinary action or
94 - INC. - november 2013
the doctor is in
Using the HealthTap
app, people get
answers to their
medical questions
from real doctors in
less than 24 hours.
healthtap will become extremely important

once obamacare kicks in. We can provide an
alternative to those simple cases that dont
require ofce visits. based on a conservative
estimate, thats about 25 percent to 30
percent of them. the cost of doctor visits in
the U.S. is more than $500 billion a year. If
we can eliminate one-third of those, it would
be huge. everyone wins. customers get
faster answers, doctors can service more
patients, and the government can save a
tremendous amount of money. We are
creating a triage system that frees up the
health care system and makes sure the
heavy resources get spent on solving the
most difcult cases.
The mission is everything.
If we can
eliminate
one-third
of doctor
visits, it would
be huge.
to your health
Ron Gutman, co-founder
and CEO of HealthTap,
has raised more than
$35 million in VC funding.
had malpractice suits led against them.

trust is critical. each doctor on healthtap
gets a score, based on his or her medical
experience and peer ratings.
doctors participate because healthtap
lets them build their online reputation, nd
new patients, and build their referral networks. to date, healthtap has generated
more than 38 million patient referrals. It also
lets doctors learn from one another.
I decided against putting advertising on
our app and our website. If we had embraced
At healthtap, our rst and foremost goal is

to save lives and improve peoples quality of
life. For now, the service is free. I believe we
have a responsibility to always provide a
baseline service for free for those who are
less fortunate. but I am a social capitalist,
and I want to create value for everyone
involved in healthtap, including our investors. eventually, we will make money by
facilitating real-time conversations with
doctors outside of their ofces. We are
currently working on a premium product that
will give our users more choices and channels
to access doctors.
What is so beautiful about our model is
that it frees up all this knowledge that is
currently locked in exam rooms. not just here
in the U.S., but everywhere. We are constantly getting requests to open up healthtap to other countries. can you imagine the
impact we can have by providing billions of
people with access to physicians and specialists they cant get access to today? We could
literally change the world.
When I was younger, I underestimated
the importance of having a mission. We get
thousands of notes from people thanking us
for what were doing. Weve even received
notes from people thanking us for saving
their lives. Its so rewarding and motivating
to wake up and know that our software is
saving peoples lives while we sleep.
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INNOVATE
coUrteSY compAnY (2)
vided health content to consumers. but I

wanted to create a new kind of system
where consumers could get more than just
content. I wanted to bring physicians into
the game.
When I started healthtap, my mission
was to improve the life expectancy of humankind by giving people immediate access
to health information and doctors, anytime
and anywhere. to do that, I focused on two
things that have been inexplicably forgotten
in health care: trust and instant gratication.
BUILTWorldMags.net
TO SUCCEED: WHEN PIGS FLY
Some things are too good to change

Over the past 20 years, co-owners Ron and Andrew
Siegel have grown When Pigs Fly from a two-man
operation baking absurdly good bread in Rons
kitchen oven to an enterprise with more than 80
employees, half a dozen company stores, and 300
additional retail outlets. Their latest venture, When
Pigs Fly Wood-Fired Pizzeria, sits next to the company
store in Kittery, Maine, and is a reection of the
Siegels belief that a business needs to keep growing
and changing to remain successful. However, like the
scratch-baked bread that underpins their operation,
one thing they have no intention of changing is their
reliance on the Mercedes-Benz Sprinter.
Twenty years in business has taught me that high
quality is what its all aboutthe most important
competitive differentiator to keep your customers
happy, Ron says. Thats why we do things the
way we do, and its why we love the Sprinter. The
company has six Sprinters, the newest being a 2012
Model 2500 Cargo Van with 144-inch wheelbase.
The vans are easy to customize, but Andrew says
BUILD YOUR OWN

MERCEDES-BENZ
SPRINTER SUCCESS
they are just perfect for When Pigs Fly in their

standard configuration.
Mercedes-Benz Sprinter: My Sprinter, My Way

The Sprinters prove their mettle day in and day
out, but particularly during the harsh New England
winters. If fresh bread does not make it to where
it needs to be when it needs to be there, its a total
loss, Ron says. During one bad storm last winter,
we had a loaded box truck stranded on the side of
the road, and one of our Sprinters really saved the
day. With its high roof height and enormous cargo
capacity, the Sprinter was able to accommodate the
entire load and get the deliveries completed on time.
Its quality focus notwithstanding, When Pigs Fly still
looks to save money whenever it can, and the Sprinter
comes up big in that regard. Unmatched reliability
keeps maintenance costs down, and the BlueTEC
diesel engines provides about 50 percent better fuel
economy than the other vehicles in its eet. The
Sprinter is comfortable, maneuverable, and easy to
drive, Ron says, Our drivers just love them.
Create your own Sprinter your way. Just go to the

Build & eQuip tool at www.mbsprinterusa.com. With
a multitude of congurations, theres a Mercedes-Benz
Sprinter option designed to t your needs. And to
connect with a Mercedes-Benz Sprinter dealer near you
today, simply click on the Find a Dealer link at the site.
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C r E AT I v E C u LT u r E
Welcome
to the
church
of fail
How celebrating mistakes
fosters innovation
Photograph by DaviD stewart
members of the congregation file into the room and sit in

rows. The ofciant stands before them, wearing a cardboard
collar and holding a large book. He addresses the group:
Dearly beloved, we are gathered here today to confess and
celebrate the failures of ourselves and our colleagues.
Welcome to the Church of Fail. Its the invention of
NixonMcInnes, a 15-person social-media consultancy in
Brighton, England. The exercise was conceived three years
ago at an of-site, as groups of employees brainstormed ways
to improve the business. One group decided they wanted to
make it OK to fail, because the more we fail, the more we can
innovate and succeed, says co-founder Will McInnes.
That group included operations manager Matt Matheson,
who saw a connection between the failure mandate and
the art of improvisation, his hobby. In improv, he says, We
celebrate our failures and learn from them. At the of-site,
Mathesons group was working in an oak-paneled room. It
had an old church feel, he says. Inspired, the group set up
a pulpit and designated a comfort zone where people could
confess their mistakes. The rest of the staf loved the conceit.
And so the Church of Fail became a monthly ritual.
(McInnes stresses that no disrespect for religion is meant.)
The ofciantMatheson or someone elseinvites people to
stand and confess their mistakes. Some blunders are small,
such as a dispute with a colleague. Others are more signicant: an error that cost the business money or annoyed a
client. Employees must describe how they dealt with the
situation and say what they will do diferently next time.
After the confession, the room explodes in wild applause.
Thats another improv practice: It helps performers equate
vulnerability with celebration. The applause makes you feel
very uncomfortable but strangely euphoric, says McInnes.
You have gotten something of your chest.
Most important, the experience encourages employees to
make bolder suggestions. McInnes recently adopted one
employees idea to create the companys rst-ever conference
for businesses. Making failure socially acceptable makes us
more open and creative, says McInnes. LEIgH BuCHANAN
office
confessions
Strategy director
Jenni Lloyd cops to
her mistakes.
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the applause makes you
feel very uncomfortable
but strangely euphoric. You
have gotten something
of your chest.
WiLL McinneS, co-founder of nixonMcinnes
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innovate

Pass the Salt
Sammy Hagar
samples the slaw at
Cabo Wabo Cantina
in Roseville,
California.
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most people know

Sammy Hagar as the
former singer of van
Halen, a wild-man
rocker who has trouble
abiding by the speed
limit. In fact, Hagar is
a lifelong entrepreneur who has turned
his passionsbooze,
music, and the beach
into a small empire.
Cabo Wabo, his tequila
brand, was acquired
by Gruppo Campari in
2010 for $91 million.
Cabo Wabo Cantina,
the restaurant-music
venue he founded
in Cabo San Lucas,
mexico, in 1990, now
has outposts throughout the U.S. Theres
also a new spirits business, Sammys beach
bar rum; a chain of
airport restaurants;
and a ne-dining establishment. He may
be 66, but apparently
the red rocker still
cant drive 55.
As told to
lIz welch
photograph by
Jake Stangel
Sammy hagar
How i Did it
Ive never
started a
business
thinking, Oh,
Im gonna
make money
off of this.
All my ideas
have come
from sheer
enthusiasm.
alwayS wanted a backup in case my

career attened out. Truthfully, I
never felt secure about my music. I
always thought, Boy, as big as you are
today, you may be history tomorrow.
Ive seen this happen time and time
again. But if it wasnt for music,
I wouldnt be able to do any of
my businesses.
I grew up poor in Fontana, California, and my mom was my rst business adviser. She
convinced me, If youre going to be in the music
business, then you have to save your money and invest
it properly, because all those guys end up alcoholic,
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innovate
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a freakin gold mine for 22 years.

after I left Van halen, Shep gordon,
a music manager, came to visit me at
Cabo Wabo. I was wearing shorts and
ip-ops, and he said, you need to
roll your whole thing into your whole
thing. around that time, I met Kari,
my current wife, who said, you remind
me of Jimmy Bufett. I thought she
was nuts. But then she took me to see
n-roll days, I used to like the whole

salt, tequila shot, lime ritual followed
by the big shiver. Point being, tequila
is a fun drink. But then I was turned
on to really ne handmade tequila in
mexico, which they didnt have in
america. I thought, This is the best
tequila Ive ever had! I want to make
this for Cabo Wabo. and I did.
Business is alive for me. Its organic.
Millions of people are exposed to Sammy

hagar in some way every day. Its like having
a huge hitbut Im not selling records.
Party On
Hagar opened the rst Cabo Wabo Cantina
in baja California, mexico, in 1990. He still
performs there 10 or so times a year.
him and Im going, holy shit. This is

awesome. Some fool with a parrot on
his head would get his ass kicked at a
Van halen show. But a light went on.
he created a lifestyle for his fans. I had
already started Cabo Wabo. I said, We
beach all day, eat tacos for dinner, drink
tequila. I get onstage and play. Thats
it. Its not like Im some genius.
Thats how the tequila company
happened. People say, Wow, how did
you gure that out? Well, I didnt. Im
instinctual. During my rowdier rock-
I dont like making money with

money. I would rather take a
shovel and dig a hole and put a
post in it and say, OK, give me
my ve bucks. Just like when I
go out and do a concert. I love
making money with my restaurants. you serve people. you give
them something, and they give
you something in return. Thats
good money.
Im a walking billboard. I got
my Cabo Wabo tattoo in 2004.
The Van halen guys hate me
for this. We hadnt spoken in 10
years, and suddenly they said,
Lets get a reunion together.
We started getting into the details, and they were like, you
cant do this. you cant do that.
One of those things was, No
Cabo Wabo shirts. So the day of
the rst show, I got a Cabo Wabo
tattoo on my arm and wore
short sleeves.
I didnt really want to sell the tequila
company. But Campari ofered me so
much money that I thought, If I dont
do this, Im going to regret it. Even if
I dont need the money, Id say, Why
the hell didnt I do that? But after I
sold it, I felt like there was a hole in
my life. We have a home in maui, and
we spend a lot of time there. I heard
about this guy mark Nigbur, who was
making vodka out of pineapples. I went
to meet him and said, youre in the
middle of these sugarcane elds. Why
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innovate
CoUrTeSy CompAny
drug addicts, and broke. I didnt want

to be poor again, so as soon as I made
a bit of money with my rst successful
band, montrose, I invested in a few
apartment buildings with my brotherin-law. Then, when we started touring
a bunch, I started my own travel agency
so I did not have to pay someone else
fees to book our travel.
By the early 80s, I was selling out
stadiums. In 1983, I made $3 million,
a ton of money. Back then, I was
seriously into bikes. my friend
Bucky was working at a bike store in
Corte madera, California, and he
said, man, these guys are building
mountain bikes with big tires and
gears. I gave him an old junky bike
and he built me this crazy-ass mountain bike. I was like, This is awesome! I can go of curbs, over rocks,
up hills. So I bought the bike store
and hired more mechanics to convert more bikes, and then opened
a bigger store, Sausalito Cyclery, in
1987, which was doing $4 million
in annual sales before I sold it.
Ive never started a business
thinking, Oh, Im gonna make money of of this. all my ideas have come
from sheer enthusiasm. I felt that
way about Cabo San Lucas. I bought
a condo down there in 1981. There
were three hotels, and none of the
restaurants had air conditioning,
telephones, or TV. But I fell in love
with the place. I wanted a place to
hang out down there, so I said, Im
going to build a tequila bar. I had an
instinct that people would come.
By then, I had joined Van halen.
So there I was, the lead singer of the
biggest band in the world. I opened
Cabo Wabo in 1990 and then invited
the band members to become partners
in the restaurantit felt like the right
thing to do. But then, in 1996, I got
kicked out of Van halen. They basically
said, you can do Cabo Wabo or be in
this band. I was like, Why cant I do
both? at that time, I was so brokenhearted about it, but it turned out to be
the best thing Ive ever done. I bought
the band out, red the team that had
been managing the restaurant, and
teamed up with marco monroy, who
still runs Cabo Wabo today. It has been
WorldMags.net
SAVE THE
BIG noSE
Save all the things that make you unique.
Everyone should be so lucky to have a big nose. It lters out pollutants.

Which is nothing to feel insecure about. It can get into everyones
business. Or make a big head look smaller. Plus, it houses one of the
most powerful senses. Scent. Which can boost a mood with a snif.
Or awaken old memories. Its a time traveler. To a warm spring day from
childhood. Or grandmas kitchen. While society may see a aw to x,
we see what you should embrace. Its just one of the many things that
make you an amazingly, wonderfully unique creature. And being true to
who you are is the rst step in being truly healthy.
Always remember youre one of a kind. And at Cigna, we want to help
you stay that way.
Tell us what youd save at savethetrueyou.com

and it could be in our next ad.
870127 2013 Cigna. All products and services are provided by or through operating subsidiaries of Cigna Corporation, including Connecticut
General Life Insurance Company and Cigna Health and
Life Insurance Company, and not by Cigna Corporation. The registered marks Cigna,
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the Tree of Life logo and GO YOU are owned by Cigna Intellectual Property, Inc.
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102 - INC. - NOVEMBER

2013
OC TOBER 2013
The Sammy Hagar

School of Business
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INNOVATE
ED PERLSTEIN/GETTY
arent you making rum? A week later,

nizes my day and handles my calendar.
restaurant? He said, My house. I
he comes over with a little barrel. I
We talk several times a day at least.
went over and ate with him four or ve
tasted it and was like, This is the best
Tom Consolo, my music manager, overtimes and said, Lets do a restaurant.
damn rum ever.
sees that part of my world.
I could not do any of this without
The rum is made not far from our
Stan Novack oversees the Sammys
the support of my wife, Kari. Shes solid
house, and when Im there, I see Mark
Beach Bar & Grill restaurants. He
as a rock. We have two daughters, ages
daily. Hes a real chemist. I might say,
used to work for HMSHost, which is
12 and 17. And then I have two sons
Everybody likes a rum and cokelets
how I met him. HMS wanted to put
from my rst marriagetheyre now 29
make some cola-infused rum. So he
Cabo Wabo restaurants in airports, but
and 43. We take the girls down to Cabo
grinds up cola beans and puts them in a I said no way. Cabo Wabo is a destinaWabo a dozen or more times a year.
tea bag and soaks it in the mash. Then,
tion. My fans go there on vacation.
Kari actually gives me shit before Im
well do tastings and get all excited.
They said, Well, do you have any other getting ready to go out onstage at the
Everything is sourced from the island. I ideas? And I said, Sure; how about a
Cabo Wabo. Nobody knows Im there.
wouldnt put anything in there that you
beachside palapa? They liked the idea,
Im up in my little dressing room, and
dont smell in the air.
My strategy for running companies successfully is to nd the right
guy. Steve Kaufman
runs the rum company.
Words of wisdom from a Red Rocker:
He was at Seagram for
I hate emailif I wake up to
years before he came to
20 emails, it pisses me of.
work with me on the
tequila. These days, I
You have to treat people the
spend most of my time on
way you want be treated and
the phone with him. Well
not go by the friggin books.
talk about someone new
that I havent pulled a
My strategy for running
favor from yetlike a
companies successfully is
chef or a restaurant ownto nd the right guy.
er I want to send some
rum to. Friendships are
I go door to door. Its pretty
really important in any
damn primitive, but it works.
industry. So Ill call up
If you have passion, it
Mario Batali and say,
Classic Rocker
spreads like frickin wildre.
Mario, come on, now.
Hagar, onstage and shredding, in 1979
Hes not loading booze
behind the bars, but he
can give me the name of
the guy who is. Im connecting the dots
so I came up with Sammys Beach Bar
Im kinda antsy. And Kari is like, Sure
all the time. And though I dont tour as
& Grill and wrote a menu. I give all
you arent taking this too seriously?
much as I used to, I try to make sure
the money from the airport restaurants
And Im like, Honey, you dont underevery radio station gets a bottle of my
to charity. Were working with HMS on
stand. I want to be good!
rum. The DJ will say, Hey, Sammy sent a new Cajun Taco concept with Emeril
I dont rest. I have so many ideas
me this rumthis stufs great! And I
Lagasse, who is a good friend. I love to
in my head. Everywhere I go, I hear,
try to make sure the rum is in every
cook, and whenever I get together with
Love your tequila, Love your rum,
venue I play. We gure the number of
Emeril, thats what we do.
or Hey! I went to Cabo Wabo. Ive got
cases based on the number of people
I care about good food; always have.
a Sammys Beach Bar restaurant at the
coming to the showroughly one drink
El Paseo is my ne-dining restaurant in
Las Vegas airport and a Cabo Wabo on
per person. But I never try to shove it
Mill Valley. Tyler Florence is the execu- the Strip.
down their throats. The main thing is
tive chef, and his team runs it. Fine
Every year, about 40 million people
that the people get to taste it.
dining is tough: ve waiters per table,
walk that strip and pass by that restauMarco and Steve are the best partcrystal, nest silverware and china. I
rant, and half a million people eat
ners on the planet. And I cant get
opened it because its in my hometown,
there. Millions of people are exposed to
through the day without Renata Ravina.
and the building was rundown and
Sammy Hagar in some way every day.
She is my business manager and has
needed to be preserved. Then I met
Its like having a huge hitbut Im not
been with me for 26 years. She orgaTyler and said, Wheres your favorite
selling records. Its totally cool.
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the investors
Brendan Anderson (left) and

Jef Kadlic had a hunch that
their investment in the
Accurate Group could lead to a
big payday. Now, it was time
to nd out if they were right.
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anatomy of a Deal
A private
equity firm
recently
offered Inc.
a rare inside
look at the
sale of an
Inc. 5000
company.
We expected
brinkmanship,
twists and
turns, and
white-knuckle
tension.
We were not
disappointed
by jeremy quittner photographs by Steven Laxton
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innovate
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rendan anderson and Jef Kadlic
What a
turnaround
Looks Like
$70 million*
and Anderson are, in fact, more akin to the entrepreneurs

opened the door to the storage room
whose businesses they invest in. They launched Evolution Capiand stopped short. This was not what
tal in 2006, with a fund of $75 million raised from wealthy local
they were expecting to see.
entrepreneurs. By 2009, when it acquired Accurate, the rm
A large blue plastic tarp was suspended
had invested most of that fund in three businesses. In each deal,
like a tent from the ceiling. The tarp protected the goal had been a return of at least 30 percent before fees, a
a set of blinking computer servers from water
typical target for private equity funds. They had missed that
that trickled through the cracked ceiling whenmark, returning from 15 percent to 20 percent. Their investors
ever it rained. A small portable fan whirred away didnt particularly mind, but Kadlic and Anderson knew that
and oscillated, cooling the machines.
Evolution would never get to the next level without a blockAnderson and Kadlic looked at each other. This was what
buster. They needed this deal to work.
they were going to spend millions to acquire?
The two men learned about Accurate from an acquainThe servers belonged to the Accurate Group, a mortgagetance, Paul Doman, a Cleveland title insurance executive.
servicing rm in Charlotte, North Carolina. Sitting on the
Doman had spent 20 years working in banking and mortgage
network was Accurates most valuable asset, a powerful suite services and knew the business well. Accurate seemed ripe
of mortgage-servicing software capable of managing thouto grow, but it was stuck in neutral: Revenue hovered at
sands upon thousands of real estate transactions. Kadlic and
about $6 million, and its owner, Paul OConnor, wanted to
Andersonthe co-founders of
leave the business and spend
Evolution Capital, a small private
more time on his 50-foot
equity rm in Clevelandhad a
yacht. Doman proposed that
hunch that the software could be
he and Evolution team up to
upgraded and marketed to banks
buy the company, which he
nationwide. If they were right,
would then manage.
they, their investors, and their
In addition to inspecting
young private equity rm would
the companys servers, AnderEvolution
enjoy a very nice return.
son and Kadlic took a hard
Partners bought
That was in 2009. Three years
look at Accurates EBITDA
the Accurate
later, Kadlic, Anderson, and a
earnings before interest, taxes,
Group in 2009.
management co-owner had redepreciation, and amortizaThis is what
tooled, refurbished, and spittionthe amount of cash genhappened next.
shined Accurate, moved it to
erated by the company. This
Cleveland, andyesbrought the

is a key metric in most private
servers in out of the rain. A slew
equity deals. Anderson and
of major banks had signed on, and
Kadlic usually seek cash ow
the company was in the black.
of $500,000 to $2 million
But now came the ultimate proof
which, as a rule, provides them
revenue
of their business judgment. They
enough cash to reinvest in the
cash floW
had put Accurate on the market
business without having to
* = estimated
at a price tag of about $50 miltake on debt. Accurate had
lion. What we needed, Kadlic
EBITDA of only $350,000, but
says, was a home run.
with a prot margin of about
10 percent, the pair bet that
The sale of an enTrepreneurial
sales growth could make up
company tends to be a highthe shortfall. In February 2009,
stakes drama, stamping a price
they and Doman bought the
tag on years or even a lifetime of
company for $4 million. The
obsessive work. It also tends to
game was on.
be a very secretive afair. So when
During the rst 12 months,
Kadlic and Anderson ofered Inc.
long-overdue investment
a chance to observe the sale of
vacuumed up most of the
the Accurate Group, we jumped
companys cash ow. But by
at it. We wanted to see Kadlic and
Year Two, the investments
Anderson swing for the fences.
began paying of. By 2011, with
Though you probably think of
new customers such as Royal
private equity partners as Wall
Bank of Scotland and KeyBank,
Street nancial engineers, Kadlic
cash ow jumped to nearly
2008
2009
2010
2011
2012
2013
$53 million
$30 million
$12 million*
$8 million
$17 million
$3 million
$1.7 million
$1.1 million
$10 million
$350,000
$6 million
106 - inc. - novEmbEr 2013
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innovate
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$3 million, and the company landed at No. 1,153 on the

Inc. 5000. By the end of 2012, it was No. 936 on the list,
and Doman forecast EBITDA would close in on $7 million
or even more.
At $7 million in EBITDA, a company crosses an important
threshold in private equitys particular calculus. At that
point, large private equity buyers begin to enter the picture,
because they can purchase the company with borrowed
money and use the companys own cash ow to service the
debt. In other words, Kadlic and Anderson thought it was
time to put Accurate back on the market. With any luck, they
gured, the company could fetch $50 million. They were
about to nd out how smart they really were.
Kadlic. No way, they said.

That left ABS Capital, a 23-year-old rm from Baltimore.
Composed of seven funds, with a total of $2.5 billion under
management, ABS is basically a larger version of Evolution.
To Doman, who hoped to continue running the company
after the sale, it seemed like a good potential match. But after
being whipsawed by the other two rms, Kadlic and Anderson were counting on nothing.
Adding to the tension, Anderson and Kadlic were determined to complete the sale by the end of the year. That
was because capital gains taxes were set to rise in early
2013a hike that would cut Evolutions windfall as much as
5 percent.
To Anderson and Kadlics relief, ABS laid out its terms in
Kadlic and anderson hired Edgeview Partners,
a Charlotte-based investment bank, to nd

potential buyers. The bankers spent three
months wooing the rms in their database with
details about Accurates nancials and found
serious interest from 12 private equity groups,
all of them far larger than Evolution. The custom in such deals is for potential buyers to sign
a nonbinding letter of intent and a nondisclosure agreement with estimates of what they
would pay to acquire a company. The estimates
were better than the Evolution partners had
dared hopefrom $48 million to $75 million.
But they were still a long way from a
signed deal. Over the next few months, managing partners
from all 12 tire-kickers came to Cleveland. They would gather with Doman and his team in a Marriott Hotel conference
room decorated with owery wallpaper. The meetings,
which Kadlic and Anderson chose not to attend, often looked
like negotiations between representatives of two vastly different kingdoms. On one side of the table, Ohio: bear-shaped,
Van Heusenshirted, blue-blazered. On the other, Wall
Street: gym-buf, Prada-suited, and French-cufed.
Two months later, the competition narrowed to three
apparently serious bidders.
But the three nalists nances werent always as buttoned
up as their representatives expensive suits. One would-be
buyer, a private equity rm from New York City, said it lacked
the funds to buy the company. Kadlic and Anderson realized
the well-dressed bankers had been blufng all along. Though
it isnt unusual for investors to pretend to be buyers in order to
gain inside knowledge about the nances of particular businesses or industries, Kadlic and Anderson were angry that the
rm had wasted so much of their time.
Now only two rms were leftone from Boston, the other
from Baltimore. Both came in with encouraging ofers at the
top third of the price range. Then the Boston team asked the
Accurate team to a dinner, at which it dropped a bombshell
of its own: Rather than buying Accurate, it proposed coinvesting in the business. Kadlic and Anderson gured
the rm was using the acquisition of Accurate as a way to
market itself to potential investors. Wed been played, says
one would-be buyer admitted

it lacked the funds to buy the
companyat which point Kadlic
and anderson realized the welldressed bankers had been blufng.
108 - inc. - novEmbEr 2013
a clear and straightforward manner. And then the rm asked

for another round of due diligence, triple checking Accurates books and quizzing the companys key customers.
Finallywith just three weeks left before Kadlic and Andersons tax deadlineABS agreed to acquire Accurate for
$55 million in equity, plus an undisclosed amount in debt.
The sale of Accurate wound up returning more than
100 percent to Evolutions investors and boosted the funds
overall return to more than 31 percent. That performance, not
surprisingly, has signicantly boosted Evolutions cred in the
eyes of its customers, institutional investors and rich individuals. Getting a signicant win and an exit like this propels you
light years forward, Kadlic says. He and Anderson recently
raised $50 million for Evolutions second fund.
Accurate, too, has been on the fast track. Doman remains
CEO, and revenue is expected to hit $70 million in 2013. In
August, the company made an acquisition of its own, snatching up, for an undisclosed amount, Preferred Appraisal,
creator of ValueNet, the mortgage industrys leading desktop
appraisal system. ABSs next milestone for Accurate: revenue
of $200 million. Says ABS managing general partner Phil
Clough: What we saw in Accurate was a technology platform
that allows a relatively small centralized team to manage
activity, whether its the size it is now or will be in 2017.
That latter date, as it happens, is about when ABS plans to
put the company back on the market.
JEREMY QuITTNER is an Inc. staf writer.
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into the lives of the women
shaping the world, including:
Chief Operating Officer, Facebook:
A great leaders most important role is not
to direct the details, but to clearly articulate
the goal and keep everyone focused on it.
former United States Secretary of State:

Its important still...for women to go
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President of Liberia, Nobel Laureate:

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gET REAl
Jason Fried
is Your Door Really

always open?
Maybe it is. But Id wager
that your employees arent
exactly lining up to get in
Your employees have lots of opinions about

everythingyour strategy and vision; the state of
the competition; the quality of your products; the
vibe in the workplace. There are tons of things
you can learn from them.
But how many of these ideas and opinions
have you actually heard? A tiny fraction, Id bet.
The reality is that companies are full of things
that are left unspoken. And even when they are
out in the open, the CEO is almost always the last
early every boss has said it. And just
to know.
about every employee has heard it. Yet its
I like to think of myself as a leader whose door
one of the most meaningless lines ever
is always open. But I recently learned that an open
spoken in the ofce:
door isnt enough.
My door is always open.
As readers of this column know, 37signals
The statement usually is followed up
recently launched a product, Know Your
with some version of, If you ever have
Company, that is designed to solicit very
an issue with anything, please come talk
specic feedback from employees on a regular,
to me.
nonanonymous basis. The idea is that people
Whats wrong with this? Isnt it impordont volunteer informationthey release it. And
tant for your employees to know that you are open to hearing their
they release it only when theyre asked about it.
suggestions, concerns, and criticisms? Of course it is.
In other words, if you want answers, you have to
But lets be real here: In most cases, My door is always open
ask questions. So, for the past few months, Ive
isnt really an invitation to speak up. Its a cop-out. It makes the
been asking all of our employees about the way
boss feel good but puts the onus entirely on the employees. You
they perceive the companys strategy, decisions,
might as well say, You nd the problems and then take all the risk
competition, quality, leadership, and the like.
of interrupting my day and confronting me about them. How many
It turns out there was a lot I didnt know. I
people have taken you up on that ofer?
asked, for example, if people had noticed anything that we had gotten worse at over the past
year. The answers were clear: Wed become a less
inventive company. With so many people buried
in stuf that needs to get done, several people told me, there wasnt enough time to experiJason Fried is co-founder of
37signals, a Chicago-based
ment. I have to x that.
software company.
Another questionIs there anything you worked on recently that you wish you could do
over?revealed that for some people, successful projects were not being perceived as successes. Why? Because they werent kept in the loop about how important their work actually
was. Thats the most serious wake-up call Ive received in a while.
Bottom line: Rather than proudly announcing that your door is ajar, get out of your ofce
and knock on your employees doors instead. And understand that a reluctance to speak up
is totally reasonable. Who knows? Maybe you have staf members who were reprimanded at,
or even red from, a previous job for speaking up without being asked.
You need to make it safe to speak up. Youll be surprised by what you hear. Youll be
enlightened. In some cases, you may be embarrassed or even ashamed. But you cant know
your company unless you knowreally knowyour employees.
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jeff sCiortino
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Who insures you doesnt matter. Until it does.
Financial Strength and Exceptional Claim Service

Cyber Security | D&O | E&O | Employment Practices Liability
Crime | Kidnap/Ransom | Property & Casualty
www.chubb.com/inc5000
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For a list of these subsidiaries,please visit our website at www.chubb.com. Actual coverage is subject to the language of the policies as issued.
Chubb, Box 1615, Warren, NJ 07061-1615. 2013 Chubb & Son, a division of Federal Insurance Company
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FALL 2013
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A special bonus section providing

management insights to leaders
of high-growth companies.
TheBuildNetwork.com
YOUR IDEA STINKS!

But you shouldnt
take it personally. In
fact, if your company
culture is healthy
there is no chance
that you could.
RACI PICTURES
To keep a project
team on track, use
a simple grid to see
who is responsible
for what at every
stage. Revise ofen.
A Game Plan
for Alignment
EIGHT GREAT IDEAS
TO MAKE SURE YOUR
SENIOR MANAGEMENT
TEAM IS UNITED BEHIND
YOUR STRATEGY.
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OPEN BOOK
How one companys
structured approach
to total transparency
powers its growth,
and even benets
its competitors.
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CONTENTS
BUILD
QUARTERLY
Whats In This Section

(And How to Use It)
Dont just read about team-alignment strategies: decide
which ones you want to share, discuss, and implement.
Because Build believes in action-oriented advice, our Contents page does double-duty as a Management Checklist.
THE IDEA
READ IT FIRST, AND THEN:

Share
Discuss
How Barrett Distribution

saw its way clear to success.
RESEARCH
TOOLS
PARTNER PERSPECTIVES
LEADERSHIP
COMMUNICATION
01
Build discovered about the
02 many waysWhat
executive teams underperform.
This simple grid can help
03 your team
meet four essential goals.
to make
04 your benefts programHow
a strategic asset.
high-performing
05 companiesWhat
have learned about how
CASE STUDY
RESEARCH
Implement
ON THE OPENER: ILLUSTRATION BY BEN WISEMAN
(and when) to expand the C-suite.
To get the best from your team,

06 learn to separate
people from their ideas.
yourself
07 literally. Write aExplain
users guide to you.
Dont let your top team
08 devote precious time
to the wrong tasks.
to make
09 your supply chain moreHow
resilient.
your team truly aligned?
10 Heres oneIs way
to fnd out.
TIME MANAGEMENT
PARTNER PERSPECTIVES
POP QUIZ
WHAT IS BUILD? A new addition to Inc. that provides senior leaders of growing companies the management advice,
research, peer perspectives, tools, worksheets, and other resources that will help you take your organization to the next level.
Tell us what you like, need, could live without (or, share your story) by e-mailing us at team@thebuildnetwork.com.
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Build works hard

to distill the best
management thinking into short, quick
takes that you can
act on immediately.
But while less is ofen
more, sometimes
more is more. To take
a deeper dive into
many of the themes
discussed in this
special section, visit
TeBuildNetwork.com
and search on any of
the following terms:
#buildtransparency
#buildalignment
#buildaccountability
#buildcommunication
#buildpriorities
#buildorghealth
BUILD
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IDEA
01
By pursuing transparency
with all its stakeholders, one
company has taken alignment
to a whole new level.
{LEADERSHIP}
82%
82 percent of
chief executives
said that transparency helps a
company grow,
and 54 percent
said that its a
vital part of their
business.
Photographs by
Jrg Meyer
When open-book management joined the Inc. lexicon 20 years ago, it was heralded as the
next business revolution. It hasnt quite worked out that way, but there is little doubt todays
management strategies are heavily infuenced by a kissing cousin, transparency.
In a recent Build survey of 146 chief executives at growth companies, in fact, 82 percent said
that transparency helps a company grow and 54 percent said that its a vital part of their business.
How does openness translate into actual growth? One telling case study is Barrett Distribution Centers, a 72-year-old logistics and fulfllment company run by brothers Arthur and Tim
Barrett. Fifteen years ago, it had a handful of employees and $600,000 in annual revenue. Today, it
employs 250 people and brings in $36 million in revenue from 120 clients.
What happened? Opennessand lots of it. Here is a summary of the Barretts four-tiered
approach to powering growth through transparency that permeates not just the entire company, but
beyond as well, to customers and even competitors:
1 Devise a nancial curriculum. Research suggests that absenteeism, payroll taxes, health
care costs, and turnover all decline with a fnancially literate workforce. For Barrett Distribution, a companywide fnancial education program was a prerequisite to opening the
books. At the start, we used a personal fnancial statement to show income and expenses
like car payments, Tim Barrett says. By the end, our employees understood the amount
of capital it takes to sustain and grow the business. Then we shared the fnancials.
2 Make the numbers personal. A weekly fnancial report tracks the companys progress toward its primary goals and includes important metrics, such as time to shipping, inventory
accuracy, and items damaged in transit. To make the numbers personal, one team member
travels to each of the companys 14 facilities every quarter to feld employee questions, launch
process-improvement projects, and assess engagement. Barrett Distributions incentive
program also rewards all employees for achieving companywide goals.
3 Aim for solutions, not satisfaction. Barrett Distributions biannual customer survey is built
around one simple path: Ask customers what metrics matter most; fnd opportunities to wow
each individual customer; and repeat until you earn the title of trusted adviser. The surveys help us understand how our customers make money and whats important to them,
Barrett says. And that allows us to be proactive in looking for opportunities.
4 Treat everyone as a source of referrals. When a software vendor asks to tour potential clients
through the company's distribution facility, or a regional logistics company calls with a question, Barrett says he doesnt hesitate. Operations managers are a source of referrals. Truckers
are a source of referrals. Anyone who comes in contact with us is. It all comes down to treating
people really well. Sometimes, that means sharing ideas with competitors. . . . If we are doing
a good job for our customers, they will remain loyal. ANNI LAYNE RODGERS
Aligning employees behind a common mission is easier said than done, unless youre Duane Jebbett, CEO of Rowmark, a Findlay, Ohio-based
manufacturer of sheet plastic. Faced with falling sales, Jebbett retooled the company culture around important metrics that he credits with its
turnaround. Here are his six tenets for keeping employees focused on the numbers that matter most: 1. Adopt a simple slogan. (You cant manage what you cant measure.) 2. Reinforce metrics at every meeting. 3. Use lots of visuals. 4. Solicit employees ideas. 5. Ofer rewards.
6. Understand the limits to metrics. To learn more, search #buildmetrics on TeBuildNetwork.com.
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THE BUSINESS: Barrett Distribution Centers

EMPLOYEES: 250
ANNUAL SALES: $36 million
LOCATION: Franklin, Massachusetts
To demolish silos and intra-departmental communication vacuums, Barrett Distribution attened
its management structure about ve years ago.
Decision-making became democratic. Passionate
debate was welcome. Priorities were made clear.
Whatever we are working on together is our most
important work, and we need everyones input to
get it done, says COO Tim Barrett.
Lewis Frazer,
SVP, 47
Arthur Barrett,
President, 51
Tim Barrett,
COO, 48
Bob Willert, SVP,
Operations, 51
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Scott Hothem,
SVP, Customer
Solutions, 45
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IDEA
02
Aligned teams are all alike;

every misaligned team is
misaligned in its own way.
(Or does it just feel like that?)
32%
10
{ALIGNMENT}
11%
21
26%
64% of execs
think their
top teams are
aligned, but, in
truth, it happens
at only 2% of
companies.
STR ATEGIC GOAL S
AC C OUNTABILIT Y
With apologies to Tolstoy, many unhappy teams are, in fact, alike. A survey of midmarket executives conducted by Build this summer found that misalignment is not random. Patterns do exist, ofen coalescing
around ve pressure points that company leaders cited time and again, as illustrated above.
Builds nding that executives ofen disagree about strategic goals is reinforced by related research conducted by Inc. Navigator, a team-alignment diagnostic and tracking tool for CEOs, which over the past ve years
has surveyed executives at roughly 600 emerging growth companies. Asked to list their companies top three
priorities, executive team members were in sync at just 2 percent of companies. Tere was even less consensus,
if thats possible, when executives were asked about their companys value proposition, according to Inc. Navigator CEO Brent Sapp.
Leadership consistency is a second-stage challenge that impacts nearly all companies as they move through
the no-man's-land from startup to the middle market, Sapp says. In other words, your top team is almost certainly out of whack. Even worse, you are probably in denial about it: 64 percent of Build survey respondents
predicted that their executive teams strategic priorities would match up nearly perfectly.
Te importance of transparency is clear (75 percent called it critical), but growth has a curious way of clouding your teams collective view. Te organizations that survive, Sapp says, are those that block out the noise and
focus clearly on what customers hire their company to do. ANNI LAYNE RODGERS
Some companies starve; others choke, says Neal Sharma, CEO of digital marketing company DEG. Sharmas team has grown 230 percent in the
past ve years. When companies add headcount at that kind of clip, managers face a huge challenge in keeping everyone on the same page. Tell
us: How does your company build alignment during the onboarding process, so that even your newest team members are clear on companywide
priorities and how their role contributes? Search #buildalignment on TeBuildNetwork.com to share your story.
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INFOGRAPHIC BY OLIVER MUNDAY
64%
COMMUNICATION
CULTURE
Asked to identify the pressure points that preoccupy

their senior leadership
teams, middle market
execs pointed to five critical issues. On the following
pages we will offer specific
advice for each challenge
so that your team can
become better aligned
and focus on what really
counts: driving growth.
TALENT
DE VELOPMENT
THE 5 PRESSURE POINTS

OF EXECUTIVE TEAMS
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IDEA
03
Responsible! Accountable! Consulted!

Informed! What team doesnt want to embody
these essential attributes? Heres how.
{PROJECT MANAGEMENT}
Strategy is a commodity, execution is an art, as management guru Peter Drucker liked to say.
Execution requires a balance between accountability and alignment. One way to achieve both
is to deploy a RACI (Responsible, Accountable, Consulted, Informed) model, a simple grid that
identifes the members of a team and delineates each persons level of answerability regarding every
aspect of a project. Capturing this visually can be a clear and efective way to spell out who does what.
Heres an example:
RACI MODEL Responsible, Accountable, Consulted, Informed
STEP
PROJECT
INITIATION
PROJECT
EXECUTIVE
PROJECT
MANAGER
BUSINESS
ANALYST
TECHNICAL
ARCHITECT
APPLICATION
DEVELOPER
Task 1
A/R
Task 2
Task 3
Task 4
Consultant Bob Kantor notes in CIO that although RACI is simple, frst-timers can nonetheless
miss the mark. To avoid some of the most common mistakes, make sure that every task has at least
one stakeholder whos responsible for it and no more than one stakeholder whos accountable for it.
Share, discuss, and agree to the model with team members at the start of a project.
Other conficts or ambiguities to avoid include: too many Rs (Does one stakeholder have too
much of the project assigned to them?); no empty cells (Is any stakeholder involved in too many of
the activities? Can responsible be changed to consulted, or consulted changed to informed? This helps
alleviate the too-many-cooks problem); and buy-in (Does each stakeholder agree to the role that he
or she is being asked to play?).
Consultant Maya Townsend tells Build that responsibilities can be tricky to assign as a project kicks of, so expect RACI to be an iterative process that should be revised whenever things get
fuzzy and also at critical transition points in the project, when roles are likely to change. She also
advises making your model very specifc to the project: If youre using generic terms, such as test
or communicate, you havent customized it enough. ILAN MOCHARI
Yes, theres an app for this. Andrew Reid, director of U.K. consulting and sofware rm Woovio, has developed a useful one for iOS devices called
KnowMyTeam, which is available for free from Apples iTunes store. To learn more, search #buildaccountability on TeBuildNetwork.com.
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quarterly
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idea
04
To derive the most value from your

employee-benets program, take a
good, hard look at your workforce.
{RecRuitment & Retention}
From critical items such as health insurance and retirement savings plans to the smaller nice-tohaves, such as gym-membership reimbursements or adoption assistance, your company no doubt
spends a signifcant amount of time developing an employee benefts program. By doing a little
extra homework, you can maximize the investment you make in your employeesand maximize their
well-being at the same time.
Most companies would do well to remember that, when it comes to benefts, one size does not ft
all. Benefts programs produce far more impact when they are tailored to the unique characteristics,
needs and desires of your workforce. Even if you have benchmarked yourself against similar-sized
companies in the same industry sector, you can further refne your oferings by carefully assessing (and
surveying) your employee base to learn everything you can about what they value today and are likely to
value over the long term.
Studies have found that companies that have an overall commitment to their employees longterm fnancial well-being reap a number of rewards, from enhanced recruitment and retention to
more surprising outcomes, such as improved workplace safety and better relationships with customers. When Harvard Business Review Analytic Services studied 58 of 100 companies who were cited by
Principal Financial Group as being among The Principal 10 Best Companies for Employee Financial
Security, researchers found that executives at those companies reported that their voluntary turnover
rates, to cite just one result, were less than half that of their respective industry averages.
These companies difered from their peers in another critical respect: They took the time to assess
which benefts oferings best matched the needs of their workforces. Its not a new concept, says Dallas
Salisbury, presdent of the Employee Benefts Research Institute (EBRI), but the gap between theory and
practice is large. Companies are so busy with day-to-day operations that they dont do this work. Youd be
amazed how many companies dont have even basic demographic data on their workforces.
That data is crucial, Salisbury says, because a company with a median employee age of, say, 27,
will almost certainly be better served by ofering benefts that difer signifcantly from those ofered
by a company with a median age of 55. A company with a younger workforce, for example, may want to
emphasize quick vesting, which can incent workers to join a 401(k) program. Companies with an older
workforce may be better served by a longer vesting period but a more enticing employer match.
Understanding the typical approaches taken within your industry and at companies of about
your size are useful starting points, adds Luke Vandermillen, VP for Retirement and Investor Services
at The Principal. Beyond that, most of the companies that have won our 10 Best award over the past
decade use an outside fnancial advisor to help develop their programs. This guidance is useful because
advisors know the local market, what other companies are ofering, and, very importantly, how to communicate to the workforce regarding your benefts program.
That communication takes two primary forms: To start, companies would do well to survey
employees about which benefts matter most to them. You may not be able to aford to ofer everya collaboration with
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The many benefiTs of a well-designed benefiTs plan

How the Principal 10 Best companies for employee Financial Security winners assessed the impact on:
Minimal impact
Some impact
25%
75%
Employee
retention
28%
72%
Employee
loyalty
Signicant impact
2%
2%
30%
2%
38%
60%
68%
Employees
perceptions of
nancial security
Recruitment of
new employees
6%
40%
58%
Teir companys
ability to maintain
competitive
advantage
47%
47%
Employee
engagement
thing they request, Vandermillen says, but this can help you prioritize. Salisbury adds that a smart
surveying approach includes asking not only about specifc benefts, but about related issues such as
how long employees anticipate staying with the company. Use a third-party surveying frm, and make
the responses anonymous, he advises. If your company is in a dynamic industry where job-hoping is
the norm, you may be more focused on recruitment than retention; that will have an impact on which
benefts, and policies, will help you succeed.
Communication is crucial in another respect as well: By continually communicating the value of
the benefts they ofer, companies reinforce the message that they regard benefts as an important and
dynamic part of their culture, and as a symbol of their concern for their employees well-being. We
advise an ongoing campaign that uses several diferent communications vehicles, from one-on-one
meetings with fnancial experts to educational e-newsletters to executive-lead Town Hall meetings,
Vandermillen says. This signals to employees that they are being heard, and that the company remains
committed to them in good times and bad.
If your benefts program isnt achieving all it might, dont panic. Identify the gaps, prioritize
them, and then evolve toward a desired end state. Remember that employees appreciate consistency, so
it is better to add or enhance benefts slowly and remain committed to what you ofer, versus expanding
your menu quickly and then having to scale back if business conditions decline. This is another advantage of using an outside advisor, Vandermillen says. They can help you map this journey.
Its a trip well worth taking.
For more resources that can help you develop a benets plan that produces the best results for your
company and your workforce, visit www.principal.com/10best.
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IDEA
05
Your top team needs to grow with

your companyboth in terms of its
size and its collective capability.
{EXECUTIVE ONBOARDING}
When Build asked executives at fast-growth companies to identify the factors that have
propelled their organizations over the last decade, the top two answers were not surprising:
launching a hot new product or service (57 percent) and success with branding or market
position. But coming in a close third was a big change in senior leadership, at 42 percent (multiple
answers were permitted). We wanted to learn more about the connection between the injection of
new talent and a companys growth, so we reached out to three of the respondents for more detail:
Dan Pickett, Nick Marsh, and Elaine Osgoodthe CEOs at Nfrastructure, Chopt Creative Salad
Company, and Atlas Travel International, respectively. ADAM VACCARO
NICK MARSH
Chopt Creative
Salad Company
CEO
WHEN THEY ADD TOP TALENT
Te biggest challenge of high-growth companies is that there is no way your management team of yesterday is your management team of tomorrow.
At all three companies, growth preceded the senior management changes deemed necessary for achieving more growth. In Nfrastructures case, a massive restructuring took place when the company reached
about $20 million in revenue and set its sights on $50 million. Atlas was also already growing when it
added common C-level positions, including a COO and a CFO. Meanwhile, Chopt adds to its top team as it
opens new restaurants.
ELAINE
OSGOOD
Atlas Travel
International
CEO
WHO TO ADD
My philosophy has always been to hire the best talent in the business and then get out
of their way so that they can do what they do best.
Osgood draws a distinction between evolving and simply growing, with the former requiring far more
care. Diferent stages in a companys growth require diferent types of hires. When Chopt experienced
its rst major growth surge, Marsh placed a premium on cultural consistency and promoted two middle
managers into vice president roles. Later, when hiring for two new senior level positions, he felt the company would be best served by newcomers with outside perspectives.
HOW THEY DID IT
DAN PICKETT
Nfrastructure
CEO
Te change [in top management] is being made for a reason, and for it to work that
reason must be made clear to all stakeholders.
Pickett, as an outsider CEO, says one of the most important things a founder can do for a new executive
early on is to introduce him or her to key customers and clients, opening the door for future one-on-one
conversations without the founder. And, he says, a new executive should never hear about a founder nixing a C-suite decision that was thought to be nal. Tose decisions, afer all, are why you brought on the
exec in the rst place.
Founders would be forgiven if they were startled by the idea of a C-suite shakeup as a driver of success, but they might be comforted to know
that only one company we surveyed directly mentioned the ouster of its founder as playing such a role. (Tat company asked not to be identied.)
Almost 92 percent of the companies we surveyed, in fact, say a founder remains active in the business. How has your company handled C-suite
expansion or the departure of a founder, and what have you learned? Tell us your story by e-mailing us at team@thebuildnetwork.com.
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IDEA
06
To optimize team
performance, learn
to separate people
from their ideas.
{THE ART OF CONFLICT}
ILLUSTRATIONS BY TODD DETWILER
How can senior company leaders create a culture in which everyone feels free to challenge assumptions? Its not easy, but it is critical: When left unchallenged, assumptions have a way of
metastasizing into facts that impede a teams ability to identify the best solutions to the most
pressing problems.
Management consultant Scott Berkun points out that this problem has no overnight fx. The
only real answer to questions of culture is [to] hire for it, he says. Culture change is slow, much slower
than technological change. . . . One great weakness of managers is their arrogant faith in the omnipotence of management. There is the belief, reinforced by management consultants and business books,
that simply by decreeing be innovative or work smarter, magic forces that transcend the limits of
sociology will transform conservative or stupid people into being otherwise.
If only. But leaders can take specifc and immediate steps to create the kind of no-holds-barred,
assumption-challenging culture that most say they want. To wit:
1. Separate people from their

ideas. Healthy debate is easy if
no one takes the results personally, Berkun says. Most heated debates involve people who
have trouble separating their
opinions from their identity. If I
[pitch] a lame idea, in a healthy
culture its reinforced that the
idea is lame but Im not."
2. Understand that some people

are instinctively better at challenging assumptions. They
ask more questions, have more
doubts, and are willing to act
on them, Berkun explains.
They are harder to manage...
but if you want assumptions
challenged that includes the
assumption of hierarchy.
3. Assess how you respond. If

you continually demonstrate
that you, the person in charge,
are comfortable being challenged or yielding your idea to a
superior one suggested by a colleague or subordinate, everyone
who works for you will emulate
that behavior.
ILAN MOCHARI
Te idea of hiring for cultural t is not a new one, but it still raises questions about how managers should do it. Career website Glassdoor
collected 285,000 common interview questions that hiring managers asked in 2012. Te top four all focused far more on cultural t than on
potential job performance: Whats your favorite movie? Whats your favorite website? Whats the last book you read for fun? What makes you
uncomfortable? Tell us your favorite interview question designed to assess cultural t: Search #intvquestion on TeBuildNetwork.com.
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PARTNER PERSPECTIVE
Making Mobility More Productive

Get ready for the next phase in communications
Call it the Convergence Conundrum. While mobility is all but a given in business these
days, mobile workers and their employers often have to deal with a confused jumble of
business and personal communications. Even as they enjoy the freedom that mobility
promises, employees lament the sense of always being at work that anytime access causes, while
employers are justifiably concerned with keeping company data secure.
The next phase of the mobile revolution helps solve this problem. Despite a diverse set
of mobile devices (often provided by employees in a trend known as Bring Your Own Device or
BYOD), organizations can deploy cloud-based solutions to help segregate communication by
rolewhether personal or professional.
Just as a business email address is accessible seamlessly via multiple devices, a phone number
supplied by a unified voice communication system (UC) is associated not with a physical landline
or cell phone, but an individual able to answer wherever he or she may be. When employees
are on the road, customers and colleagues can reach them with a single call instead of dialing
multiple numbers, and get an immediate answer instead of winding up in voicemail. Employees,
meanwhile, have complete control over when theyre available with where taken out of the
equation entirely.
Basile Insurance in York County, Pennsylvania, recently learned the value of Be Anywhere
when it adopted Comcast Business VoiceEdge Unified Communications system. Weve truly
changed the way we communicate with each other, says Gregg Basile, owner. Our customers
seem happier, which, in turn, makes us happier.
ORGANIZATIONAL AND PERSONAL BENEFITS
Just how big is mobility? According to Global Workforce Analytics (GWA),1 more than three million
U.S. workers telecommuted in 2011, a staggering 73 percent increase since 2005. And nearly one third of
employees globally now rely on more than one mobile device in a typical day.2
Theres no question that employees love the fexibility that mobile technology enables. In fact,
GWA notes that 80 percent of employees consider telework a job perk, and that it makes them more
productive as wellby as much as 15 to 55 percent.
Mobility and BOYD dont just increase productivity. Theyve been shown to drive customer
satisfaction rates as well. Research from Forrester3 shows that among organizations that implement
BYOD strategies, 76 percent report increased employee responsiveness and decision-making speed,
while 43 to 46 percent report faster customer-issue resolution and improved customer satisfaction.
Todays cloud-based solutions can also save companies time and money in both direct and indirect
ways. By making remote workers more efcient, it facilitates telecommuting, a signifcant cost saver,
with GWA calculating that a typical business would save $11,000 per person per year if those able to
telecommute did so just half the time. And because workers consider mobility an important perk,
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companies may also save on recruiting and salaries. How much? GWA notes that 36 percent of workers
would choose telecommuting over a pay raise, or that 37 percent of technology professionals would take a
pay cut of 10 percent if they could work from home.
Organizations can also see savings when it comes to capital expenditures in IT infrastructure,
technology upgrades, and scalability. When Smart Marketing in Naples, Florida, ran up against the
maximum number of extensions its in-house PBX system could handle, it was faced with having to purchase
hardware upgrades, which the company could just as easily outgrow in the future. Instead, they turned
to Business VoiceEdge, which could not only scale efortlessly to meet their current and future needs, but
relieved them of burdensome annual maintenance and technology lock-in, at the same time ofering higher
quality and greater fexibility. Trying to add another user to the phone system [had been] unbelievably
hard, recalls Dave Meehan, web developer, adding that with Business VoiceEdge, we can confgure lines
through the Web portal, which was not possible with the older system, and the phone-to-phone quality has
increased dramatically.
A VOICE SYSTEM FIT FOR MOBILITY
Comcast Business VoiceEdge ofers greater efciency
by delivering a phone system through the cloud. Having
a unifed communications solution means that you get
integrated business communications allowing you to
call from your desk phone or mobile phone and have it
appear as if you called from the ofce. Your company
can enjoy constant connectivity without the capital
investment and hardware management that typically
come with traditional private branch exchange (PBX)
phone systems.
Business VoiceEdge ofers service continuity,
so your important, incoming calls always reach the
intended person even if disaster strikes. Features
include Be Anywhere voicemail to emailin your
inbox or on your smartphone; call management and feature editing through Microsoft Outlook, Internet
Explorer, or Firefox Internet browser; and much more.
To learn more about how Comcasts Business VoiceEdge can improve communication for your
organization, visit business.comcast.com/smb/services/phone/managed. For more information about
how mobility is enabling the workforce and improving productivity, download the free white paper,
Empowering the Mobile Workforce: Hosted Voice Solutions Help Boost Productivity and Customer
Service, at business.comcast.com/empowering-mobile-workforce.
1Global Workplace Analy tics, Various sources, http://w w w.globalworkplaceanaly tics.com/pros- cons
2Cisco Connected World Repor t, Oct. 2010
http://blogs.cisco.com/wireless/the- cisco- connected-world-repor t-mobilitys-role-in-workplace-flexibility/
3Forrester: The Expanding Role of Mobility in the Workplace, Feb. 2012
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IDEA
07
Help employees learn your

leadership style by giving
them a users guideto you.
{COMMUNICATION}
The people whove worked with you for a long time may understand your peeves and preferences so intuitively that theyve adapted to your leadership style in myriad, hard-to-defne
ways. Or maybe not. Meanwhile, what about newer hires? Should they be expected to get you
in short order? Is there anything you can do to help them?
One zero-cost, easily replicable solution is to create a users manual that documents your
wants, needs, and predilections as a manager, addressing everything from which modes of communication you prefer to what one thing drives you completely nuts. Think of such a manual as a one-page
cheat sheet that can galvanize transparency companywide.
Build asked Luc Levesque, founder of TravelPod, and Ivar Kroghrud, cofounder of QuestBack,
to share their manuals with us. Based on those examples, we created this how-to guide:
Yes, its all about
you--and in this
case, thats exactly
what you want.
Your manual can
be as simple as
a single sheet of
paper. Levesque
advises sharing it
with each person
one-on-one, versus
e-mailing it to all.
Tink of it as a
conversation-starter
(but dont do all
the talking).
A USERS MANUAL TO YOU

Heres a quick start guide for your team to know how to work with you best
MY EXPECTATIONS
MY VALUES
MY PROCESSES
What are my expectations for

commitment to the job beyond
conventional work hours?
Which do I value
more, speedy work or
deliberate work?
HANDLING CONFLICT
MY STRENGTHS
MY WEAKNESSES
MY IDIOSYNCRASIES
How will I help

my employees get
better at
their jobs?
What weaknesses of mine

should the team
know aboutand
how can a team
member help me
improve?
What are my
idiosyncrasies
that is, what are
the individual
quirks that anyone working with
me should know
about?
What is my process
for handling conflicts?
REPORTING
MISTAKES
When it comes to
mistakes, whats
the best way for
employees to come
forward?
ILAN MOCHARI
We were inspired to explore the phenomenon of executive user manuals by articles in the New York Times that proled both Levesque's and
Kroghruds endorsements of the practice. Asked why he authored a guide to himself, Kroghrud said its a way to shorten the learning curve
when you build new teams and bring new people on board. He credits the leadership training he received in the Norwegian navy for underscoring the importance of helping people stay focused. To see more examples, search #usermanual on TeBuildNetwork.com.
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IDEA
08
OK, so your team is aligned.

Now make sure its working on
the things that really matter.
{HOW TO PRIORITIZE}
ILLUSTRATIONS BY TODD DETWILER
Even the best senior management teams struggle to allocate their time wisely: A 2011 McKinsey & Company survey found that only 35 percent of executives think their top teams time is
properly allocated to core C-suite functions, and just 38 percent thought their executive teams
focus on work that merits their perspective.
We asked executive-team expert Ron Ashkenas of Schafer Consulting how executives can
improve on those fgures. He tells Build that a top teams focus should be narrow: long-term strategy,
resource allocation, hiring and development processes, and corporate governance. Some executives,
such as the CFO and COO, have plenty of operational nitty-gritty to deal with, but they should do so
on their own time, so to speak, versus in the context of their roles as top team members.
Ashkenas and leadership consultant Michael OBrien of the OBrien Group ofer these strategies for keeping executive meetings focused.
1. Drop old habits. Ashkenas

challenges his executive clients
to imagine completely losing
one workday a week. Which
duties would they drop or
delegate? This exercise forces
each executive to reprioritize
his or her daily duties and helps
ensure that C-level meetings
focus on critical work only.
2. Set boundaries. Every C-level

meeting should have a clear
agenda and goals, OBrien says.
Even time for debate should
be scheduled, with minutes
allotted to each exec. To rein
in blabbermouths, appoint a
facilitator to shut down chatter,
or give every team member
conversational veto power.
3. Give information a purpose.

Every agenda item should result
in one of two outcomes, OBrien
says: a decision made or a problem solved. If a team member
brings a report to the meeting, it
must play into achieving one of
those two goals. That means no
more pro forma updates.
ADAM VACCARO
Of course, determining which issues merit the collective brainpower of the C-suite versus being solely in the domain of an individual exec is not
easy. For a useful counterpoint, consider Booz & Company senior partner Jon R. Katzenbachs classic Harvard Business Review article, Te Myth
of the Top Management Team. In it, he provides three litmus tests to help you decide whether any given task should fall under the C-suites
collective purview. One example: Will the situation at hand require diferent leaders and diferent expertise at diferent points of the process? If
so, Katzenbach says, its probably a job meant for the top team. To learn more, search #topteam on TeBuildNetwork.com.
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09
Your supply chain is becoming more

complex (even if you dont know it).
Heres how to make it more resilient.
{OperatiOns}
10%
Fewer than 10%

of companies
have proved able
to withstand a
disruption that
lasts 10 days or
longer.
Could your company survive a disruption within its supply chain? Its not an academic question:
Research shows that disruptions are becoming more common as supply chains become more
complex and interconnected. By some measures a majority of companies will face a crisis every
four to fve years. Fewer than 10 percent of companies have proved able to withstand a disruption that
lasts 10 days or longer.
This is a particular concern for midsized businesses, because their smaller scale often makes
them vulnerable to the larger companies they sell to. Lack of infuence, constrained access to capital,
and reduced fexibility regarding the companys ability to run below or beyond capacity make such
companies particularly vulnerable to supply chain problems.
Fortunately, midsized businesses also have some key advantages. They can respond to problems
more nimbly, since typically their senior management teams all operate under one roof. They tend
to have a longer-tenured, more committed workforce that will roll up its sleeves and attack problems
quickly. And they tend to be innovative, but cautiously so, investing in new capabilities early, but not
quite bleeding-edge early, which has proven to be a smart way to avoid major risks.
Because middle market companies dont have the resources to address every possible problem
that might arise, researchers at the National Center for the Middle Market recommend that companies
take six distinct steps to create more resilient supply chains:
1 Build stronger relationships with select supply-chain partners. Look both up and down your
supply chain, and focus on those partners that you collaborate with and trust the mostthey may
not be the same partners you do the most business with. Look for ways to share risks and rewards
with these key partners.
2 Form strategic horizontal alliances. By cooperating with your competitors you can gain access
to physical and knowledge resources, share risks, and gain efciencies. Three carmakers, for
example, teamed up to develop an online portal that provides comprehensive supply-chain data
to a variety of partners.
3 Form a cross-functional team of senior managers to develop a risk register. This is a central
source of information about the probability of risks and associated mitigation strategies. Again,
because all senior managers may work in the same location, this is often easier for middle market
companies to address than for large companies.
4 Focus on core competencies. Be cautious in responding to new customer needs or requests that
divert your attention and resources from what you do best.
5 Innovate within your core competency. Customers care about innovationin fact, your brand
benefts enormously when you gain a reputation for being an innovative frm. Quality and
In PartnershIP wIth
A Collaboration Between
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reliability count as well, of course, but by consistently investing in innovation you help ensure
that, should a disruption occur, customers will wait for you to recover because they believe in
your company and are therefore disinclined to explore alternatives.
6 Capitalize on employee loyalty. Often, the deep knowledge and institutional memory of your
employees is what enables your company to spot problems and develop quick solutions. Your
employees have your back and are willing to put in long hours to help get the company through
tough times. If, that is, you have built a sense of resiliency into your culture. Make sure your
employees know that they are respected and appreciated for all that they can do.
Resilience is a highly desirable trait for any company to pursue, but it needs to be approached
with a sense of balance. High exposure to risks, combined with limited capacity to address them,
certainly creates vulnerability. But, at the same time, any attempt to make your company completely
invincible to any and all supply chain disruptions that might possibly occur will eat up precious
resources that should be devoted to your growth strategy.
Focus on the most common categories of threats:
turbulence (external economic factors largely out of your control)
deliberate threats (piracy, theft, terrorism)
external pressures (competitors innovations, government regulation, health & safety
concerns)
resource limits (raw materials, utilities, human capital)
sensitivity (brand reputation, product quality, reliability of equipment)
and connectivity (scale and extent of your supply network, reliance on specialty sources, use of
outsourcing services)
Then map those potential threats against a longer list of supply-chain capabilities, which can
range from fexibility in sourcing and manufacturing to efciency, adaptability, collaboration,
fnancial strength, and more.
To help determine if your company has a good balance between its vulnerabilities and capabilities,
use the abbreviated version of the Supply Chain Resilience Assessment and Management (SCRAM)
tool, available at www.middlemarketcenter.org/supply-chain-resiliency-assessment.
The goal should be to get your company into the zone of balanced resilience, in which you
reduce your exposure to risks without unduly eroding profts. Approached methodically and with a
sense of purpose, it is a very achievable goal. You cant avoid every potential problem, but, with the
right planning, you can avoid being disproportionately derailed by any single disruption.
Tis article is derived from a longer research paper, Te Resilient Supply Chain: Competing on the Ability to Come Back from
Disaster. Te paper is based on research conducted by Keely Croxton, Michael Knemeyer, Mikaella Polyviou, and Joseph Fiksel
for the National Center for the Middle Market, which is sponsored by the Fisher College of Business at Te Ohio State University
(OSU) and GE Capital. Te underlying SCRAM approach was developed by the Center for Resilience at OSU. For more information
on supply-chain resiliency, as well as a host of other challenges and opportunities confronting middle market companies today,
visit the National Center for the Middle Market web site at www.middlemarketcenter.org.
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16
Companies should
assess 16 distinct
capabilities that
enable them to
anticipate and
overcome supplychain disruptions
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IDEA
10
Silence is deadly (and

other rules of healthy
executive teams).
{POP QUIZ}
Ultimately, the degree to which your executive team is aligned is inseparable from the larger
concept of organizational health.
Like employee engagement and customer delight, organizational health sounds both highly desirable and difcult to quantify. But management consultant Patrick Lencioni says there are some clear
indicators. You know you have [organizational health] when you have minimal politics and confusion,
high degrees of morale and productivity, and very low turnover among good employees.
For more on how to address problems, see the sources referenced in The Plus below. For a quick
take, The Table Group created this abbreviated team test exclusively for Build. ILAN MOCHARI
TEAM-ASSESSMENT QUIZ
Have your executive team members answer each question on a scale of 1 to 5 (as follows:
1 = never; 2 = rarely; 3 = sometimes; 4 = usually; 5 = always), add each par ticipants score,
and then take the average across all par ticipants.
1 Team members quickly and genuinely
apologize to one another when they
say or do something inappropriate or
possibly damaging to the team.
never
always
2 During team meetings, the most

important and most difcult issues
are put on the table to be resolved.
never
always
3 Team members leave meetings condent

that their peers are completely committed
to the decisions made during the meeting,
even if there was initial disagreement.
never
always
4 Team members call out one anothers

unproductive behaviors.
never
always
5 Morale is signicantly afected by the

failure to achieve team goals.
never
always
SCORING:
An average score of 18 to 25 sug gests that the team is functioning well; an average of 11 to
17 indicates that dysfunction could be a problem; an average of 5 to 10 indicates that the
dysfunction needs to be addressed.
PRINTED IN THE USA. COPYRIGHT 2013 BY Mansueto Ventures LLC. All rights reserved. INC. (ISSN 0162-8968) is published monthly, except for combined July/August and December/
January issues, by Mansueto Ventures LLC, 7 World Trade Center, New York, NY 10007-2195. Subscription rate for U.S. and Possessions, $19 per year. Address all subscription correspondence to Inc. magazine, P.O. Box 3136, Harlan, IA 51593-0202; 800-234-0999; icmcustserv@cdsfulllment.com (U.S., Canada, International). Please allow at least six weeks for change of
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address changes to Inc. magazine, P.O. Box 3136, Harlan, IA 51593-0202. Material in this publication must not be stored or reproduced in any form without permission. Requests for permission should be directed to permissions@inc.com. Reprint requests should be directed to Te YGS Group at 800-290-5460, ext. 128. Inc. is a registered trademark of Mansueto Ventures LLC.
NOVEMBER 2013 VOL. 35 NO. 9
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GE Capital
LIKE AWorldMags.net
BANK:
WE CAN LOAN YOU MONEY.
UNLIKE A BANK:
WE CAN ALSO LOAN YOU PAULA.
At GE Capital, were not just bankers, were builders. So, in addition to smart financing, we also
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find substantial savings by making their purchasing operations more competitive. We also shared best
practices that helped Belk become a more inclusive company. Chances are we have someone just like
Paula with the know-how to help your business grow. Stop just banking. And start building. GE works.
GECapital.com
Paula Clayton
GE Retail Expert
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Franchisee Fit
by Mark Henricks
The rst place to look for a great franchise business

opportunity is within. Thats the advice of franchise consultant
Joe Mathews of Nashville. Too many would-be franchisees
start by trying to identify the currently hot franchise, he says,
when what they should be doing is asking themselves what
they want from a franchise, and then trying to nd one likely
to produce that outcome.
The second outcome is generally quality of life, he says.

Again, denitions and desires vary. Some people want to
have meaningful, purposeful work that contributes to the
community. Others place signicant emphasis on exible
hours, while others want to be able to spend their day at
work surrounded by children, animals or engaged in a
favorite avocation-turned-vocation.
After that, a franchisee should look for an opportunity that

plays to his or her strengths. Ideally, a candidate will be gifted
in the particular areas a business needs for success. At a
minimum, he or she should not be handicapped. For
instance, an introverted person probably would not do well
in a business requiring lots of cold calling. Nor would a
creative personality mesh well in one where organization is
at a premium. Whatever the skills and experience the owner
Financial reward is always on the resulting list, but not needs to bring to the table, the franchisee better have them,
everyone denes that the same way. For some people, a Mathews says.
franchise is expected to replace the salary from a job. For
others, it is expected to produce a return on investment When it comes to individual concepts, a franchisee should
greater than alternatives with similar risk proles. Whatever feel comfortable with the leaders vision and with the
nancial result is expected, the franchise should be able to culture of the company. Finally, the franchisee should
believe strongly in the offering. I havent seen a franchise
generate it pretty reliably, Mathews says.
People dont buy franchises, they buy results, he says.
They buy what they want the business to do for themselves,
their family, their careers. That means that nding the right
t is far more important than nding the next hot opportunity,
he says. And that process begins with a personal inventory
of what things the franchisee candidate hopes to get from
becoming a franchise owner.
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where passion for the product or service isnt a must, There are 248 Fit Body Boot Camp locations on four
continents and in seven countries, including licensees and
Mathews says.
franchises. Well add another 150 locations in the next year,
So before looking at franchises, a franchisee should look at Keuilian says. The major metros do well, but we actually do
him or herself. It all starts with a personal inventory, best in suburbs where the population is below 100,000. Our
Mathews says. What do I want the business to do? What ideal sweet spot is where a city has about 50,000 people,
because were so community driven.
do I have to do it with?
What Fit Body Boot Camp has to offer is what founder
Bedros Keuilian calls the anti-franchise franchise. By that
he means the indoor group tness concept involves low
franchise fees and start-up costs. Also, rather than a
percentage royalty, the franchiser collects a set monthly fee
from franchisees.
The sweet spot for WOW 1 DAY Painting is the franchisee

who has sales and marketing talents, a strong work ethic
and a passion for revolutionizing a highly fragmented
industry. We arent looking for people who want to paint
homes, we want people who want to build a national
brand, says Brian Scudamore, founder and CEO of the
Vancouver-based franchiser.
In return, franchisees get a muscular marketing and lead

generation campaign. We run massive GroupOn
campaigns, Keuilian says. Each year, the company sells
15,000 to 18,000 vouchers for boot camp training via the
daily deal company in order to drive clients and revenues to
franchisees. Our mission is to give our owners a bigger
check each month than they give us, Keuilian says.
WOW 1 DAY Paintings basic concept is straightforward:

The franchisees painters will come in on the scheduled
date and paint the entire house including trim and moldings
in a single day. The quality and price are comparable to
companies that will take a week or more to do the job,
Scudamore says. Imagine leaving for work in the morning
as the WOW 1 DAY Painting team arrives and then coming
When it comes to nding ideal franchisees, Keuilian says a that evening to nd a freshly painted space with no mess
lot of candidates assume they need to be tness professionals left behind and a bouquet of owers.
or have athletic backgrounds. They dont, he says. We
teach you how to nd a tness professional to run the In addition to sales and marketing skills and a passion for the
concept and brand, Scudamore says personality is critical in
workout sessions.
nding a good franchisee t. I always ask myself when Im
What franchisees do need, however, is a passion for the interviewing someone whether I can see myself inviting them to
service and for helping clients achieve tness and weight my home for a barbeque, he says. The answer will tell him
loss goals. Anyone who puts the money rst and passion whether the candidate will t with the companys culture and
for helping people second, actually ends up making less ultimately be on board with his vision of building a nationwide
brand in the largely mom-and-pop, fragmented painting industry.
money, Keuilian says.
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Nearly 250 Seniors Helping Seniors territories are currently

operating. Yocom has targeted opening 100 new territories
over the next year in locations across the U.S. and in its rst
international market in the United Kingdom. After that, Yocom
has his sights set on further expansion, always staying true
to its initial vision.
WOW 1 DAY Painting has 25 open locations spread

throughout Canada and the U.S., from California to Texas
and the Northeast. Well triple that over the next couple of
years, Scudamore says. Its most attractive markets are
larger metropolitan areas with more than 500,000 population
and several of those markets remain available, awaiting the
right franchisee.
The most attractive franchisee for Daycare Cleaning Services
is a jack-of-all-trades with particular strength in sales and
marketing. Our franchisee should have the ability to wear
all the hats, says Rob Nestore, president of the Cherry Hill,
New Jersey-based company. Having a background of
previous janitorial experiences is a plus, but its not necessary.
You need to have the ability not only to sell to the childcare
center and schools, but the ability to maintain the service
that you just sold.
Daycare Cleaning Services addresses a very specic
niche: providing high-quality cleaning services to
childcare and educational facilities. The company operates
a corporate location serving New Jersey, Pennsylvania,
Delaware, and New York.
Nestore says they are open when it comes considering
potential new markets over the next year. We would love to
sell between ve and 10 franchise units, he says.
Love is a key ingredient for franchisees of Seniors Helping
Seniors. The Reading, Pennsylvania-based company
provides non-medical home care to senior citizens, and
CEO and co-founder Philip Yocom says franchisees
success is determined by how much they love what they do
and those they work with.
We invested close to a year dening our prole of who we
believed would be most successful with our Seniors
Helping Seniors business model before we granted our
very rst franchise, he says. And we have neither
compromised nor deviated far from our initial vision of a
loving, giving, caring, compassionate person who wants
to help and work hard to make a difference in and change
the lives of seniors and their families.
To adverTise conTacT 646.322.4290 | www.inc.com
We continue to believe our mutual ability and commitment

to tap our collective resources of our entire Seniors
Helping Seniors community is what will continue to help
to set all of us apart as being leaders and innovators, not
only within our own industry but our entire world as well,
he says.
The Joint sets itself apart from other chiropractic care
clinics by providing quality care through a unique business
model. Unlike most chiropractors, its doctors dont take
insurance and patients dont need appointments. Walkins are welcome, and patients pay for care when delivered
or through pre-paid membership plans. The clinics also
are open evenings and weekends and prices are
competitive. Convenience and prices are the two biggest
things, says John Leonesio, CEO of the Scottsdale,
Arizona-based company.
When it comes to t, The Joint is well-suited to business
people looking to own a healthcare business, he says.
Franchisees dont need to be chiropractors or health
professionals, but they need be nancially savvy and able to
follow the nely-tuned system.
With over 150 locations in 23 states coast to coast now
open, Leonesio expects to grow to about 250 over the
next 12 months. He says they are open to growth in any
city or state.
Staying open to possibility is something franchisees should
strive for as they search for the perfect franchise, Mathews
says. People who have never been business owners
before are likely to nd themselves strongly affected by the
experience, he says. Theres no way to calculate what the
effects of that change will be. So, while tting the franchise
to the franchisees requirements and abilities is critical, its
also wise to keep in mind that the future may be different
from the past.
When they start a business, people have a tendency to
transform and step up, Mathews explains. From
employee to entrepreneur -- thats not a change of scenery
or environment, its a fundamental personal transformation.
Once you become an entrepreneur, its like going from a
cucumber to a pickle. You cant go back. Youll always be
an entrepreneur.
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Scott Belsky
What is your greatest strength as a leader?
Scott Belsky, co-founder and head of the
portfolio-showcase site Behance, says his
is understanding his weaknesses
By issie lapoWsky Photograph by Daniel seunG lee
Whats the biggest myth

in business?
Bigger is better. A business
should be judged not by its size
but its impact.
Gut instinct vs. expertise:
Which is more important?
Gut instinct. Muscle memory isnt
very helpful when youre charting
new territory.
Whats the toughest part
of being in charge?
Killing ideas that are great but
poorly timed. And delivering tough
feedback thats difcult to hear but
that I know will help peopleand
the teamin the long term.
How do you measure success?
Success is being able to make
an impact in what matters most
to you.
What was the hardest lesson
you learned during your rst
year in business?
Dont focus on too many things.
Focus on fewer things to make real
progress on whats important.
What business leader do
you most admire?
Jef Bezos. He was one of our
investors, and I admire his
long-term vision. Somehow,
Jef doesnt allow the urgent nearterm pressures to get in the way
of his important long-term goals.
Whats the best motivator
for employees?
Progress.
What have you sacriced
for success?
Entrepreneurs must devote a
portion of their minds to constantly
processing uncertainty. So you
sacrice a degree of being present.
What have you learned
about yourself while running
your business?
Understanding my weaknesses
makes me stronger. Self-awareness
is gold. Otherwise, you miss your
faults and fail to change when you
need toand you will need to.
bencHmarks
Scott Belsky sold Behance for a
reported $150 million. The Behance
community is still growing.
140 - inc. - NOvEMBEr 2013
scan tHe paGe to WatcH scott belsky

Discuss HoW to make an acquisition Work.
(See page 10 for details.) For the Founders

Forum video with Inc.s Scott Gerber, go to
www.inc.com/founders-forum.
WorldMags.net
founderS forum
WorldMags.net
WorldMags.net
WorldMags.net
Find your
work-life groove
From laid back to more upbeat, you'll find a range of inspirations
in our Business Class. Savor gourmet cuisine, laugh through the
latest comedies or tap your feet to your favorite tracks. Get in
tune with the business of living.
emirates.com/us
Airline of the Year 2013 Skytrax World Airline Awards
WorldMags.net

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Exit Rich: Inside the sale of an Inc.

The Magazine for Growing Companies

Alexa von Tobel

How to unite your team behind you

Your business succeeds

Stepping up for better health care

Dell recommends Windows.

Meet our overachieving

Dell Venue 11 Pro

Dell Venue 8 Pro

photograph by Steven Laxton

November 2013 - inc. - 5

the 2013 Hire

Inc.s salute to the fastgrowing private companies

the Know-how Report

THIs pAge: BrIAn kluTcH/geTTY

A private equity rm ofered Inc. a

Work From Caf

The power to make informed business decisions

20 Tip Sheet Dont fear competition.

44 Special Know-how Section Our 16-page

72 Tip Sheet Turning customers into designers

90 Tip Sheet Pictures speak louder than

The blazing fast revolutionary

One of the smallest and lightest

With the E-M1s new Dual AF System,

4 Tips for Hosting a Hackathon

The hardest thing

LET GROUPS FORM

Open the hackathon to anyone who wants

These competitions traditionally revolve

Go Beyond the Page

Youll nd the icon at the left on selected pages throughout

10 - INC. - NOVEMBER 2013

Copyright 2013 United Parcel Service of America, Inc.

DePUTy eDiTOR dan FeRRaRa DePUTy eDiTOR, iNC.COM allison Fass

DiReCTOR, sTRATeGiC PARTNeRshiPs AND eveNTs lynn shaFFeR

DiReCTOR, CONTeNT DevelOPMeNT Jon Feld

GROUP DiReCTOR KaThleen oleaRy

DiReCTOR anne MaRie oKeeFe

GROUP PUblisheR, DiGiTAl whelan Mahoney

GROUP DiReCTOR sTeven suThiana

CONTROlleR eve pai

ChAiRMAN Joe MansueTo

Chief fiNANCiAl OffiCeR MaRK RosenbeRg

64% of ontarios workers have

The highest percentage in the G7

26.5% corporate tax rate

Ontario, Canada is a dynamic growth engine where

new thinking and ideas flourish, where pioneering

You need to be where growth is happening. Make

Doing Your Job,

s I wrIte, economists are still glowing

about this mornings jobless claims

14 - inc. - November 2013

stretch. You can meet the founders of some of these companies in

months issue: a special bonus

eric schurenberg erics@inc.com

All of which makes this

Air on the Side of Success:

The Global Pursuit of

s founder, managing partner,

ies all over the world helping her

McKelvey Prince and her partners,