Steps for Entrepreneurial Success

Hello everyone and welcome to Everyday MBA. Interviews with best-selling authors, innovative thought leaders, and top-shelf executives all sharing their best techniques and tips that you don't learn in business school. I'm your host, Kevin Crane, and I'm so pleased that you're listening. Our guest today is Bryan Cressey. Bryan is a nationally recognized pioneer in the venture capital and private equity fields. He's co-founded 4 private equity firms and has been featured in Time Magazine as one of the 4 leading venture capitalists in America. Bryan was named one of the 20 Most Inspiring Chicagoans in 2020 and has been inducted into the Chicago Business Hall of Fame and the Chicago Entrepreneurship Hall of Fame. He's with us today to talk about his new book, Be a Winner: Life's Handbook for Joy and Success. But first, a reminder, you can find me and keep in touch with the show at everyday-mba.com. Listen to the interview archive and subscribe. That way, you'll never miss an episode. And would you like to be a guest on the show? Find out more at everyday-mba.com/guest. Now, on to the interview. Bryan Cressey, welcome to Everyday MBA. Your book is Be a Winner: A Life's Handbook for Joy and Success, and you have spent the last 10 years compiling what you have learned and the tools that you have used to be successful. What's one important lesson or technique that you wish that you'd learned earlier?

I wish I'd known when I was younger to not accept what the world expects me to do. I got so much advice. You should go into this academically. You should go to this school. You should go to this job. Most of it was well-intentioned and all of it was wrong. What I found out was go with my instincts. I found something that I loved, which turned out to be helping build companies, not engineering, not mathematics, not other things. And I went with it. When Professors wanted me to continue in school, study this. I said, no, that's not where my passion is. So I learned, follow your own passion. And when people tell you how to get somewhere, they're probably wrong. Figure it out, what fits for you. And then you can go on a path and you have a lilt in your step when you're enthused and you're passionate about it. And that's how you make it work.

Now, you are a nationally recognized pioneer in the venture capital and private equity fields. You've worked with and observed many startups and ventures. You're talking about a gut feel, follow your passion, maybe don't follow the prescribed rules or advice. Is that something that you have followed throughout your career in venture capital? And has that worked for you? How, how has that worked for you?

I really have followed that advice. For instance, when I was in college, the first 2 years I was partying and not getting the grades I wanted. Everyone told me, well, just hang in there. I didn't. I stopped college and went to work for a conveyor belt company. Oh, did I grow up living in the real world. School was easy when I went back after that. I also didn't go into the careers people expected after grad school, which would have been consulting or banking or something. I wanted to get in venture capital, which really didn't exist. There were 2 jobs in America in 1976. I was fortunate. I got one of them solely because I focused on it. It's the only thing I'm going to do. And then in the venture capital business, we've done different things than everyone else. For instance, the last 20 years, as we build companies, Our investors tell me, Bryan, don't pay too much for companies, get good value. Well, guess what? We can only make it work on companies we can really grow. Those companies are expensive. So we have consistently bought expensive companies we could grow. In the last 20 years, we've done incredibly well in spite of the advice. And the key was, don't listen to the advice, do what's right. For you, yourself, and your firm.

I want to ask about venture capital and entrepreneurship. We have a lot of listeners that are in startups or are entrepreneurs. It's one thing to have a great idea, but another to make it a viable venture. How can I turn my great entrepreneurial ideas into reality that really is a business?

I've learned The way you turn great visions into reality is the following. First, you talk about the end result, the benefits to customers, to the world, to patients, whatever it is. You talk about the benefits of success of this vision with enthusiasm. And when you do that broadly, what I have found is great people who know how to do these things come because they view it as an adventure. You're really going to try to do that? I want to help. And people from that niche will come to you. So speak with enthusiasm, but about the benefits to the world, to others. It magnetically attracts people. And when new people come from the outside to join your young firm, new energy is created, and that energy drives innovation, And action, and the dream gets completed. I've been fortunate the last 10 years to start a couple of enterprises that were new and unexpected for me to start. One was an addiction treatment center with new type of treatment for people who are homeless and poor, and totally new addiction treatment. We attracted great people. We got it going. 6 years after it started, we got a national award for the best program in the United States. Well, I didn't do that, but this process of enthusiasm about who you're going to help and the magnetic way that attracts people made it work. And that can be done in for-profit businesses, scientific businesses. It works everywhere. So I'm just discovering those things the last 10 years. And they're really working, and they'll work for you too.

Interesting that you chose addiction treatment as an example of a great case in venture capital entrepreneurial success. That's not a venture that I would have expected to be top of mind as an example. Do you feel that the underlying connection with something more important than just a balance sheet was part of the success of that particular endeavor?

Absolutely. What I've learned is it was— it's not just the numbers. It's not mostly the numbers. People behave or change behavior, move to your firm for one reason: they're emotionally inspired. They— you've got to get the logic right so it all makes sense, but that won't create action. Action is created by emotion. Emotion is created by a appealing to higher instincts and wonder or spirits in people. And most firms don't do that. So you, anyone listening, I, we all have the chance to use this, to use positive emotions to change behavior in wonderful, beneficial ways.

And I think the world is yearning for that kind of feeling in everything that we do nowadays is that How has that played out for you in the last couple of years or so?

It's playing out wonderfully. I mentioned the one example. I started a venture capital firm with my partner, Senator Bill Frist, 5 years ago. We wanted to see what the innovators in healthcare were doing. Well, we got the word out that we're going to do this, and great people came to us. We have some young partners, and opportunities have come to us. They want us— companies and entrepreneurs want us because of our experience, success, knowledge of healthcare. They want us to invest in their companies. So do our competitors. They want us to partner with them, and it's worked out wonderfully. And so seeing the benefits, espousing what could be, is a powerful tool hardly anyone uses, and yet it's there for each individual listening.

Now that my company has launched, is launched, I need strategies to grow that company. What are the most important performance metrics and growth strategies that you use in the companies that your firm owns?

The single most important thing I would look at, you can look at metrics of different channels of distribution and what's working and what's not to get customers, but the most important one is connect with the customers and find out, track their levels of satisfaction, interview them. Why are they satisfied? Which ones aren't? What would they love to have so you can satisfy them better? You'll get more business, but also find out how you can help their life, how you can make it easier. What more could you do for that same customer? And then finally, one secret is ask your customers to give you recommendations. And when they recommend you, it turns out they love you even more. It's not like they did you a favor, it's like you did them a favor. And so ask them for recommendations that you can quote. So getting closer to the customer, going deeper with them, and going broader allows you to really expand your business and to learn their needs. Which is your future.

Hi, this is Chris Dessy, author of Remarkable You: Build a Personal Brand and Take Charge of Your Career, and you're listening to Everyday MBA with Kevin Crane. It's time to reach new customers in a new way, and you can do that when you become a guest on Everyday MBA. Get your subject matter experts heard or get yourself heard on the show and talk about your ideas and advice. Talk about strategies and tactics that will make a difference in our changing business environment. Find out more at everyday-mba.com/guest. That's everyday-mba.com/guest. You're listening to Everyday MBA. We are speaking with Bryan Cressey, a nationally recognized pioneer in the venture capital and private equity fields and an award-winning entrepreneur. We're talking about his book, Be a Winner: Life's Handbook for Joy and Success. And Bryan, shifting gears a little bit, we've been talking about venture capital. I'd like to talk a little bit more about that joy and success part. And many folks struggle to know the right move in their career, who to work for, when to change jobs, what about their career paths, especially now. Can you give us some advice on how to diagnose the future, if you will, maybe, and evaluate a company that you may want to work for, or how would I decide to make the jump to work on my own or start my own thing? Can you give us some advice?

When you're looking at a potential company that you may— that you're thinking of joining, a few things to look for. One is, how strong is their business in the sense that how much do customers need them compared to other competitors? Do they have a strong franchise? Do they really have something special? Their profit margins, the higher they are, the stronger their franchise. Also, the people are almost everything. How good are the people? And if you can understand the management team's prior successes, that's going to be your best predictor. A person's past success is the best predictor of their future outcomes. So get to know how people have done in the past. And then teamwork. When you interview these people, do they talk about working as a team? If they do, that's terrific. They're probably going to do well. But if they brag about individual successes and what they did, watch out. The team probably doesn't exist, or it will crumble, and that will bring down the company. Then the final thing is to look for the markets they're in. Are these markets going to keep growing? Are they in growth markets? If they are, the wind's at your back. But if they're declining or flat markets, it probably wouldn't be a great company to join.

Joy and success, they're not mutually exclusive, but they certainly have a lot to do with each other. With the success part, you're an experienced negotiator. What are some of the best practices to use during a negotiation, whether that's a business negotiation or employment? Especially when making really important, high-stakes, long-term decisions?

I think in negotiation, several things work well. 3 points I will mention. One is surprisingly silence. When you employ silence in a negotiation, especially when things are tense, when you just go silent and just listen, most people are extremely uncomfortable with silence. So you can just sit there like amused. And what tends to happen, the other side will often say something and offer something that they weren't going to, to try and re-engage you, to find out what's that person thinking. What is he or she— they're silent, what are they thinking? So silence is a wonderful tool. I learned to use it sometimes when I was a little befuddled and I just went silent. And people would say, Bryan, that was great when you went silent. And I didn't tell them, actually, I was a little confused and was thinking through things. But I learned that it worked well. Secondly, sometimes ending the negotiation for the day, just saying, you know, that's it for today. I think I'm done. We're done. We'll resume tomorrow. Ending it before they want or expect. Is very powerful as well too, because again, they may come back to you, try and keep it going by offering you something. And then the third point I would offer is figure out— there's always a multiplicity of things the other side wants. It's not just price. There's a multiple list of things. Find out some things they want. that you don't really care about and you can give them and work out a transaction where you get a couple things you want or need, they get things they want, and you end up with a win-win solution. That's way more likely to happen to— and it's a deal that's way more likely to get concluded, closed, legally documented because you've figured out a win-win solution. So I found those very, very effective rather than trying to win and leave nothing on the table. That's short-sighted.

Ultimately, your book is about finding joy and fulfillment in your life along with success. What's the secret to enjoying our success once we gain it?

What I've found is the secret to enjoying success is recognizing That what is success? It's not just having money or acclamation. Success becomes being happy with the people around you, living in love. So love with your teammates, love with the people around you, content with who you are. And being content with who you are at this certain age and stage That contentment comes from knowing your purpose, your personal mission in your life, and working towards that. Not working towards an artificial goal or what someone else told you to do, but always being cognizant. What does Kevin want? What does Bryan really want? And working towards that and being open-minded, not thinking we have all the answers. But listening. So I find when I have gratitude for everything in my life, including the glass of water next to me here, when I have gratitude, I'm happier. When I forgive and don't hold grudges, I go forward faster and more effectively. And when I feel love from other people and I show love to people, I just enjoy life a lot more. And I throw in a little humor. Don't be too serious too often. It doesn't help. And humor is free and fun.

I'm so pleased that you're listening to this podcast. If you like what I do, why not let me do it for you? My audio podcasting services give voice to your success and expertise. Do you have a happy customer? Let them tell their story in their own words. Need to get your subject matter experts heard by new clients? Let's do an interview and we'll discuss the topics at hand. Are you an author, an analyst, a C-suite leader? Let me create a custom podcast for you that gets your message out to a new audience worldwide. Want to find out more? Go to craneegroup.com. That's C-R-A-I-N-E, craneegroup.com. You're listening to Everyday MBA. We are with Bryan Cressey talking about his new book, Be a Winner: Life's Handbook for Joy and Success. Bryan, we have reached the action item round of the show. I'm wondering if you could provide us with 3 quick action items that our listeners can do to begin to take advantage of the ideas and advice in your book.

Sure. The first action item I would take is to prioritize aggressively. There's a lot of things we all want to do. Cull down that list to 1, 2, or 3 items and solely focus on those. Just get those done. I've seen that those who win big are the ones that get their top priorities completed, not trying to complete a long list of to-dos, but Prioritize, get those done. Secondly, I've noticed that great entrepreneurs that build wonderful companies, they do it by asking this question, what if? They're constantly asking themselves and their colleagues, what if it doesn't work like that, like we all assume it works? What if it works differently? What would that mean for us? What if I did this? What if you did that? And experiment and be willing to make mistakes. Because learning to succeed is empirical. It's trial and error is what builds great companies. And finally, I've learned people don't do enough of this. Aim high. Aim really high. Dream large because you can achieve your dreams, as we discussed earlier. If you don't aim high though, You're not going where you might have gone. And I recall Duke Snider, who was, I call a philosopher from the '50s, but he's actually a right fielder for the Brooklyn Dodgers. He said, swing hard, you just might hit the ball. And I think that's a great lesson for life. Go for it. You only live once and you may achieve it.

Bryan, it's been great speaking with you today. We're almost out of time, but before I let you go, one last question. You've given us some great advice here today, but what was the best piece of advice that you ever received and how has it shaped who you are?

My best piece of advice was way back to 40 years ago. A professor said, the one difference between creative people and other people is creative people make longer lists of alternatives, much longer. And a bunch of the alternatives look stupid, but they just keep going. And many times, the second half of that list has the best answer. I employed that. I started making longer lists of alternatives and options. Boy, has that worked. And I think it made me creative. I think a lot of the innovation I've succeeded at is because I make longer lists of options and alternatives, and it gets our minds thinking differently, and it becomes a habit. And boy, has that helped me a lot. So, I thank that professor. In fact, I called him recently and did thank him, and he was astonished that this long-ago student called. It was the best piece of advice I ever received.

That is Bryan Cressey. Get his book, Be a Winner: A Life's Handbook for Joy and Success. Bryan, thank you so much for being our guest today on Everyday MBA.

Kevin, thank you so much. These were wonderful questions and a great dialogue. I thank you.

That'll do it for this episode of Everyday MBA. And do you want to be a guest on the show? It could happen. Join our Knowledge Leadership Circle and be featured in an interview of your own. Be a guest. Just go to everyday-mba.com/guest for more information. That's everyday-mba.com/guest.