How to Make $400 Million in 10 Years...Really?

How to Make $400 Million in 10 Years

That’s the title of an article I found in the inc.com archives’. I really am a sucker for an article with a title like that. In 10 years I can be how rich? I’m in  Of course it’s never as easy as it seems and it takes a lot of hard work and a little bit of luck.

The article talks about a company called the Lamp Post Group which is an incubator of sorts that is also part of a company that offers shipping logistics. The company wanted to build something bigger then just a logistics company. So the company used excess revenue to build an incubator where they launch or take over start-ups and organize them around one back-office structure. The idea behind the concept is that the people running each of these businesses can worry about building great products and marketing the crap out of those products. Let someone else worry about the accounting, web design and all other aspects of the business. Just grow baby!!

The article has 5 rules to set up when searching for explosive growth. The 5 rules are:

1. Invent New Revenue Streams

2. Empower Employees

3. Remove Barriers

4. Capitalize on What IS Already Built

5. Identify a Specialty

The Company is always on the look for new revenue streams based on issues that they have if they find a problem that they need fixed they go find a small company that sells the service they need then they acquire the company and figure out how to sell it to other companies. Some of these companies have been involved with helping companies finding entry-level employees coming out of local colleges as an example.

They empower employees by building work teams known as Pods that have both revenue and cost goals and focus on specific functions. This allows employees to really own and fix different parts of the company. Would we be able to enter the retail or high end goods market if we had a 3 person team that focused on one or both of these projects? How far could we go in just a few years? What would happen if they focused on improving our manufacturing processes. Two years a go we found a piece of machine that has saved us big on our material cutting  by automating cutting weg replaced 3 cutters with one and reducing out material waste per yard by 30 to 40 percent. This adds up quick.

Less important but time consuming tasks become barriers to growth. The entrepreneurs that should focused on growing a business can get tied up on all the day to day things from HR and web design to accounting. Any time not used to growing a new business is slowing down its grow.

The last thing is find a specialty that you can use to your advantage like your ability to develop certain types of products.

The article is very good and worth checking out. I suggest you give it a read.

 

Interesting Story of a New Billionaire

Found a great article from a few months back on Forbes about a German man who recently became a billionaire after turning around the engineering company that his father worked for when he was growing up.

Check Out The Article
Wolfgang Leitner was the son of a machine fitter in germany that wanted to do bigger and better things with his life so he went to school to get a doctorate in chemistry. After school  he ended up as a consultant working for McKinsey. While there he got the chance to work on the project of fixing his fathers employer Andritz AG that had fallen on hard times and needed restructuring. A few years after the project started he took a job at the company. In his career he has done a lot to transform the company and build it in to one of Europe's largest engineering companies.

 "Leitner has spent the past 25 years helping to boost sales to $5.9 billion, up from $194 million, and propelled profits  from $1.2 million to nearly $300 million."

 From humble beginnings to graduate degrees to turning around a troubled company and building it up into a multi-billion dollar company. It points to the fact that hard work and good strategy can build a company to incredible heights. And also that you don't have to start the next facebook to do it you can turn a regular company into something massive or turn a struggling company into a sprinter. the article is a good read.


Also check out an unrelated but interesting book:

Billion Dollar Turnaround: The 3M Spinoff that became Imation

Howed Our Supplier go From $10 million to $350 million Without Us Noticing?

It feels like everyday...well actually it is every day the CEO asks "What are you doing to grow the business?" and frankly while we are working at growing our business we never have anything in the development that is going to get our $10-$15 million dollar business to that magical $100 million dollar that seems so out there and lofty a goal that we might never get there. Never the less it is the company goal I mean how could a small carrying case manufacturer possibly hope to grow that large in a short period of time its not possible. Our thinking has been recently we have to diversify into a whole new market that is much larger then carrying cases...or atleast that was until I read the 2012 Inc. 500. While scrolling thru the ranks wondering how we could possible make it to this level of growth I saw a familiar name. Otterbox a company that I knew as a maker of plastic carrying cases a small guy I had always been told like use in a niche market you could never get big in,  and here they were on the Inc. 500 as one of the 85th fastest growing company in the U.S..(5th straight year on the list)  They had grown from $10.2 million in 2008 to $347.5 million in 2011 or 3,312% in 3 years.

How OtterBox Did What We Couldn't

Now they haven't done this just by simple selling more of their standard plastic cases. They did it by studying trends in the market and going after those trends as soon as they spotted them. They outsourced their manufacturing so that they could focus their time on marketing and product design. Today they are one of the biggest brands of protective cases for smartphones. They also have shown a willingness to kill projects that are not working before they become anchors as a former hit product becomes a forgot memory. When they realized a product line didn't have a future they abandoned it and moved on to bigger and better things. They have created an R&D team that focuses purely on predicting and build up the future pipeline, this team doesn't get bogged down with trying to hit home runs today they are focused on where the company should be looking 6 months to a year from now if not longer.

growth tips from Otter box