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2 / E N T R E P R E N E U R . C O M / September 2018
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8 / E N T R E P R E N E U R . C O M / September 2018
Why We’re All
Better Together
Let's stop thinking about “older generation” and
“younger generation.” That holds both sides back.
WANT TO KNOW why we put a any time across history, the next
13-year-old entrepreneur on the generation were truly worse
cover of this magazine? There’s than the prior one—then soci-
the simple reason, of course: We ety would have ground to a halt.
want to celebrate youthful Innovation would have ceased.
achievement and inspire others. But it did not. We dismiss
But there’s a deeper reason, today’s youth the same way you
aimed at anybody old enough and I were once dismissed by
to rent a car. If that’s you, go those older than us. It was never
take another look at Zollipops true, what they said. Not once.
founder Alina Morse on our And it’s not true now.
cover. She looks like she’s hav- If you condescend to the
ing fun, right? So carefree! Her youth, you only blind yourself to
whole life ahead of her! But danger. You won’t get destroyed
make no mistake; she and her by the competitor you watch
peers are coming to replace you. closely; you’ll get destroyed by
They are smart—trust us, we’ve someone you never saw com-
interviewed them, and they are ing. That girl on our magazine
frighteningly smart. They see cover? That’s who’s coming.
problems with fresh eyes, unen- But this shouldn’t be a com-
cumbered by the calcified logic petition. Entrepreneurship isn’t local paper, which set off a crazy standing, and that everyone has
that blinds those with more a zero-sum game. It’s a com- series of events: A fan of rapper their own path.”
experience. They’ve watched munity built on shared wisdom Chris Brown read one of Lopez’s That’s it right there! When
you, and seen you fail and suc- and mutual respect. So really, I stories, then asked if he’d help we recognize talent in whatever
ceed, and absorbed the lessons. write the above as a way to say develop a fan page. The page form it takes—any age, any back-
They’re savvy. They’re ready. this: We all benefit when we let became so big that Chris Brown ground—everyone benefits. All
Many people don’t see this. these young entrepreneurs in. himself hired Lopez. (This was we must do is shift perspective.
They say young people are Respect them as they respect before Brown’s legal troubles.) Because, yeah, you could look
lazy or entitled. They say “mil- you. Learn from them as they “If it wasn’t for my men- at our cover and say, “There’s a
lennial” or “Gen Z” as if it’s learn from you. Then you’ll take tor being by my side,” Jeff tells 13-year-old girl on the cover of
an insult. And when they do, part in another, grander tradi- me, “no one would have taken Entrepreneur.” Or you could just
they partake in one of the tion—of paying it forward. me seriously.” But today, major say, “There’s an entrepreneur on
world’s oldest traditions. “Self- Consider the story of Jeff Hollywood studios take him the cover of Entrepreneur.” Both
admiring, emaciated fribbles” Lopez. In 2007, when he was plenty seriously. His company are true. But the second one is
is how the young generation 16, he wanted to start a market- GLOOB works with them reg- more useful for us all.
was described in 1771. “So full ing company but was too young ularly; recent projects include
of self-conceit and admiration to legally sign the paperwork. Wonder Woman and Mad
of their own dear self ” is how a So Sadie Clayton, the coordi- Max. Sadie and Jeff are still
GROOMER, CASEY GEREN
writer in 1853 put it. “A whole nator at his after-school pro- in touch. “I have learned more
10 years of experience?!?! They gram, stepped in—filing the arti- about myself through mentor-
must be geniuses by now” is cles of incorporation and other ing Jeff than I could have ever
what some dope tweeted at me documents, and helping him imagined,” says Sadie, now Jason Feifer
in 2018, when I described mil- build his company into some- admissions director at Camden jfeifer@entrepreneur.com
lennials as leaders. thing real. Then she continued Center for Youth Development. @heyfeifer
If any of this were true—if at to help him as he wrote for the “I learned patience, under- S U B S C R I B E : entm.ag/subscribe
From defining your leadership style to learning how to motivate your team or reaching
your company’s vision, the Entrepreneur Voices series features inspirational stories from
next-level changemakers and timeless advice for anyone with an entrepreneurial spirit.
Gladwell, Undefined
Author and podcaster Malcolm Gladwell has liberating advice for entrepreneurs: Don’t be one thing.
And it’s a message he takes to heart. by J A S O N F E I F E R
September 2018 / E N T R E P R E N E U R . C O M / 13
Q&A
M
streamline and execute some-
thing successfully, I might have
a very different approach. I’m
reminded of my father, who
alcolm Gladwell may have one of the strongest was a mathematician. There
were problems he worked on
brands in media, but he never applies the word for 20 years—not exclusively,
but he started it, put it aside,
to himself. “I contradict myself a lot,” says the and then one day the answer
best-selling author and New Yorker staff writer, would pop into his head. If you
try to rush your work in that
whose books include The Tipping Point and situation, you’re going to close
Blink. “How can I represent something as well- yourself off to certain kinds of
breakthroughs.
defined as a brand if I’m constantly changing my
P H O T O G R A P H B Y G E T T Y I M A G E S / B R YA N B E D D E R / S T R I N G E R
mind?” Instead, he counsels creatives to think of That’s a valuable reminder,
because people often fear
themselves as ever-adaptable—open to opportunities wherever that if something they do
they come. That’s why, for example, he got into podcasting. It doesn’t bear fruit immediately,
it never will.
was on a lark, but now, three seasons later, his show Revisionist Yeah. It’s about approach-
History is a consistent chart-topper. (Each episode is about ing your work with humility.
The problem is almost always
“the overlooked and misunderstood,” and is produced by the larger than you, and so it can’t
be mastered in one fell swoop.
podcast company Panoply.) Here, he talks about his approach to You have to learn to give the
productivity, his own evolution, and why entrepreneurs need to problems you’re working on
the respect they deserve. And
balance ideas with execution. part of the respect is under-
standing that, you know, What
14 / E N T R E P R E N E U R . C O M / September 2018
I’m doing here can’t be done developed calculus at the same ideas. I wonder how con- How do you define what you
in six months. It just can’t. So time, say. Two others devel- sciously you developed that. do, then? Do you have
why don’t I find a way to give oped color photography. But Like, do you think of yourself a filter, or some way to look
it a year or two years. given that entrepreneurs think as having a personal brand? at opportunities and say,
of themselves as ideas people, I don’t really. I think it gets “This is right for me”?
A lot of your writing focuses I wonder what you think they really dangerous—if you’re It’s funny—starting the pod-
on solutions to overlooked should do with that insight. someone who’s doing some- cast changed a lot of my think-
problems—like your New You do two things with it. One, thing creative—to start to ing about what I do, because I
Yorker article “The Talent it ought to be a gentle reminder define what you do. Even if it’s ventured into a world I never
Myth,” about how companies
harm themselves by promot-
ing the wrong type of work-
ers. Entrepreneurs are always I’M OPEN TO SUGGESTION. THE MOST IMPORTANT
looking to identify problems
like this, but they’re not easy
THING IS NEVER TO MAKE A DECISION ABOUT
to find. How do you do it? YOURSELF THAT LIMITS YOUR OPTIONS.
It helps that I’m a permanent SELF-CONCEPTIONS ARE POWERFULLY LIMITING.”
outsider. To make the link with
entrepreneurs, it’s no surprise
that the people who tend to
come up with the most innova- about the importance of humil- a correct definition, it’s limiting thought I would venture into.
tive breakthroughs in a given ity—that you shouldn’t pre- to have that thing in your head. Now I’m doing something
field are people who approach tend you are the sole person in It starts to constrain you. So I that’s much more collabora-
the fields from the outside. You the universe to have happened rebel against that, and I’d like to tive than I normally do, where
bring a whole new, fresh per- upon an idea, and you should pretend that the things I do can there’s production and editors
spective. And the other thing also understand that ideas be different as anything under and sound engineers, and the
that gets undertheorized in come as much from the world the sun. Now, it’s obviously not mode in which I’m reaching
innovation is just how much of outside of you as your own true. But it’s just really useful— people is very different, where
it is generational. It’s very often thinking. And the second thing more useful to think that way I’m relying on my voice and
that change happens when the it does is, it ought to remind than to have a sense in my head not my pen. I only did this
original generation is no lon- you about the importance of of what I stand for. because my best friend runs
ger in a position of authority, execution. Maybe ideas are a podcast company, and on a
and a new generation comes cheap, but the ability to exe- So you’ve never thought to lark he said, “Why don’t you
along with new ideas. There cute well is at a premium. Just do something and then said, try one?” And I thought, Why
is a wonderful case study with because lots and lots and lots of “Hmm, that’s not what my not? I thought it would take
the telephone, which was com- people conceive simultaneously audience expects”? me, like, a month, and I would
pletely mismarketed because of search doesn’t mean the guys I don’t think it’s a good idea never go back to it. Once you
the people who invented the at Google aren’t geniuses. to work backward from your realize just how much seren-
telephone were from the tele- audience. People who listen dipity there is in a field like
graph industry. They under- Right, because the people we to you listen because they like mine, you have to abandon
stood the technology but not know as history’s greatest you, not because you resem- any kind of rules like that. I
its place in society. And so for innovators were really also ble them, or because they want tried to write a screenplay;
30 years, the telephone kind great executors. their own particular tastes rep- it didn’t work but was really
of languishes—until all those Yes. As a writer, I’m constantly resented on the page or in the fun. I don’t regret doing it. I
guys are gone, and a new set aware of that fact. So many of podcast. They’re curious. This is did that MasterClass thing—I
comes in who just have no the things I write about have my problem with a lot of mar- mean, I never thought I’d do
memory of telegraph and so been written about a million ket research. People in market that. I’m open to suggestion.
are unencumbered by that set times before, but the value I research don’t properly weight The most important thing
of assumptions. bring is in how I re-present this distinction between, you is never to make a decision
those ideas and the context I know, when you want to give about yourself that limits your
When talking to entrepreneurs, put them in. I don’t feel like someone exactly what that per- options. Self-conceptions are
I often think of a piece you that’s a lesser accomplishment. son wants, or when what that powerfully limiting. In the act
wrote about “simultaneous I feel like that’s actually a pretty person wants is something they of defining yourself, you start
discovery”—that across time, honorable and important thing. can’t articulate and you’re in the to close off opportunities for
multiple, totally disconnected position of presenting them with change, and that strikes me as
people tend to have the same And you’ve developed a very a gift or a surprise. And I’m in being a very foolish thing to do
innovative ideas. Two people distinct way of presenting the gift-or-surprise business. if you’re not 85 years old.
September 2018 / E N T R E P R E N E U R . C O M / 15
Personal
O
ne day in March, show me her findings.
I arrived at my Los The presentation took four
Angeles office and hours—and at first, yes, it was
prepared for an uncomfortable. But as my anx-
emotional bruising. iety lessened, and I was able to
My executive coach focus on the points being made,
had interviewed I realized how insightful it was.
17 people close to When you’re CEO, unvarnished
me—my wife, my mom, my feedback is hard to find. People
cofounders, my direct reports, rarely critique the boss to his or
and some other employees—and her face. But now I was learn-
it was time to learn what they ing. For example, I don’t think
said. What do they think are of myself as a micromanager.
my strengths and weaknesses? I want to trust my colleagues
What are my blind spots? and let them find their own way.
Where do I need improvement? But the report revealed I wasn’t
I wasn’t sure I was ready to actually doing that. I was still
hear the answers. too involved in others’ work; I
Recently, I reached what needed to step back more. That
felt like a pivotal time in my was good to know.
career. Over the past 11 years, Another lesson: Everyone
sweetgreen, the company I notices when I’m well-rested, that balance between leading culture. This process changed
started with two friends, has and they prefer me that way. and executing. (For example, that. It made me recognize that
grown to 86 locations and This felt counterintuitive. I’d do I really need to be interview- to take risks, my team needs
millions of customers around been working 70-hour weeks— ing every corporate office job to feel autonomy, and to feel
the country, with more than in part because there’s a lot to candidate? No.) And I kept my comfortable doing things that
3,500 team members. I’m CEO, do, but also to project what’s early-morning schedule mostly might fail. That means they
which means everyone comes called servant leadership. I want meeting-free. need to see me fail first. I set
to me with the hard questions. people to know I’m here and I’m But the hardest part was yet the tone—and so this report,
As we’ve grown, I’ve become working for them. But some- to come. I sat down with every- full of vulnerabilities I must
ever more aware that every times I start the day the way one my coach interviewed and own and discuss, is actually a
decision I make significantly I prefer to, by surfing or doing took them through the find- tremendous first step in that
impacts our customers and yoga. When I do, people said, ings. I’d never felt more vulner- process. Now I think about
our team members. That’s why I arrive at work noticeably more able, talking with people about leadership differently. It isn’t
I got a coach. I thought of it energized and impactful. I was my weaknesses laid out bare. just about working long, hard
as an investment in myself as setting the wrong example, it And yet it prompted the great- hours. It’s also about model-
a leader. After six months of turns out. Instead of being the est realization of the project. ing the kind of culture that will
work, she asked me to submit tired CEO, I need to be the one I’d always wanted sweetgreen help my company thrive. That,
to this giant personal review. who takes care of himself as to be a company that takes I’ve learned, is what happens
And that’s how I ended up in much as his company. risks—because risks are what’ll when you get honest feedback
this nerve-racking position, my After reviewing the report, keep us fast-moving and inno- from those closest to you: It
hands sweaty as she loaded up I made changes. I stepped back vative. And yet I didn’t exactly may be a shock at first, but it
the PowerPoint presentation to on many tasks, trying to find understand how to create that strengthens everyone.
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The Big Idea
r
obert Glazer didn’t was untapped talent in Accel- better than, a centralized work- These days remote work has
set out to build a eration’s niche field of affiliate place. So Glazer had to figure entered the business mainstream,
100 percent remote marketing across the country. them out as he went along. with about 43 percent of the U.S.
workforce. But in So Glazer began figuring out Ten years in, Acceleration has workforce occasionally doing
2007, while forming how to run a company flexible grown an average of 30 percent their jobs from outside the con-
his company, Accel- enough to hire workers who a year, while piling up accolades fines of a corporate office. While
eration Partners, he could work remotely. Back then, for its workplace culture from some large employers like IBM,
realized two things: this was a rarity. Telecommuting the likes of Glassdoor, AdAge, Bank of America, Aetna, and
One, fierce competition in hubs was a concession you might Forbes, and The Boston Globe. Yahoo made headlines in recent
like New York and San Fran- make to individual workers, not Glazer sees his company’s flexi- years for ending or scaling back
cisco had driven the salaries of a corporate strategy. There were ble work policy not as a handicap their telecommuting programs,
even less-desirable candidates few established protocols for that it has overcome but a key the number of remote-first start-
through the roof; and two, there making it work as well as, if not driver of its success. ups has surged. Acceleration
September 2018 / E N T R E P R E N E U R . C O M / 21
The Splurge
M
ost entrepre- affordable little speedster. looking up. The warehouse of it. “There’s a traffic circle
neurs are con- For a long time, Sashen was was “humming along,” they between our house and our
cerned first and in no position to buy a new had their best quarter ever, office,” he says. “Every day,
foremost about car. He and his wife, Lena, had and they did a $1 million-plus twice a day, I approach the
making payroll. founded Xero Shoes in 2009, equity crowdfunding raise. “I circle, downshift into second,
If they accom- an evolving line of lightweight, think we can relax a bit,” Lena floor it, and fly around that
plish that, they minimalist shoes and sandals told her husband. She sug- circle, pinned to my seat and
start to think that feel like going barefoot. gested giving out bonuses, or laughing or shouting, or both,
about making some money The company grew methodi- bumping up their own salaries. as the car catapults out of the
themselves. And if they accom- cally, year by year. By 2017, they’d been driv- roundabout. Anyone who says
plish that, maybe they think Then they had, in Sashen’s ing the same car for 12 years. money can’t buy happiness has
about splurging on something words, “a hell of a year.” In Sashen’s mind went instantly clearly never driven my car.”
they’ve wanted for a long 2017 they moved their distri- to that little Subaru, and he Almost a year later, his ardor
time—an extravagant watch, a bution to a logistic company’s went hunting for one. It turns has not waned. “I’m happy
PHOTOGRAPH COURTESY OF SUBARU
second home, a fancy car. warehouse, which then went out most dealerships don’t every time I look at it, parked
For Steven Sashen, CEO and out of business. They moved carry the BRZ he wanted, but right outside my office window,
cofounder of Colorado-based to another one, which couldn’t he found one eight hours and giddy every time I drive it,”
Xero Shoes, it was…a Subaru. handle their volume, so they away, in Wyoming, that had Sashen says. “And at least once
“I’d see a car on the road about decided to open their own been sitting on the lot for six during each drive, I’m grateful
once a week,” he says. “Every warehouse. Then they had to months. He had it sent to a for our business, for the people
time, I’d think, Wow, that is deal with production problems dealer two hours away, drove who helped us build it, for my
supercool. What is it?” And and the loss of two hard-to- there, and traded in his old smart CFO-wife, for the amount
every time, it was a Subaru replace employees. But by the car for the BRZ. of luck we’ve had, and for what’s
BRZ—known as a snug, end of the year, things were Now he makes the most taking us into the future.”
22 / E N T R E P R E N E U R . C O M / September 2018
Office Space
NINA GEORGE/
General manager of growth
“I recently had a baby and just
came back—I got 12 weeks at
100 percent pay—and it’s like I
never left. You’re able to pick things
up exactly where you left off.”
September 2018 / E N T R E P R E N E U R . C O M / 25
Problem Solvers
The Bill
That Nearly
Broke Her
Are you prepared for a big, unexpected cost?
Saima Khan wasn’t—and it forced her
to rethink her entire business. by J A S O N F E I F E R
S
aima Khan had an couldn’t absorb an unexpected
epic string of luck. financial hit. This one came
She was a banker in in the form of a new United
New York, and one Kingdom law that retroactively
day she ended up taxed a lot of Khan’s old
chatting with Warren income. There was no way she
Buffett at an airport. could pay it off and still make
“We had a very per- payroll. “I was at a position
sonal conversation about love, where suddenly I’m going to be
loss, risk, home, and food,” she wiped out,” she says, “and I’m
says. By the end, she’d offered thinking, Will I be able to even
to cook him a meal at her home. live in the house I’m in?”
Buffett accepted, brought Bill What does an entrepreneur
Gates along, and ate well. Then do in this situation? Ideally,
the industry titans asked her to experts say, she should have
cook for their upcoming charity already had an answer. “You The first was consulting. Many Now she had a plan. To pay
event, which she did—making should always stress-test your people asked her for business down the tax bill, she borrowed
large, shareable plates, harking business,” says business consul- advice, and she helped when money from friends. Then she
back to how her Pakistani immi- tant Adam Bornstein, founder she could. But now she formal- launched the consulting service
grant family fed guests. of Pen Name Consulting. “When ized it—creating a new service and staffed up her drop-off
The event was a hit. More things are going well, run where, for a fee, she’d help business, creating a seasonal
invitations followed. Soon, through your nightmare sce- entrepreneurs flesh out their menu and a process for her
Khan saw opportunity. “People narios—you’re out of inventory, brand for a day or six months. team to follow. The impact was
who were quite well-traveled your customers have fled, and so The second was a new kind almost immediate. Today, only
were always looking for new on. Think through how to pre- of cooking experience: drop- one year after her crisis, her
dining experiences,” she says. emptively lessen that damage or off. Until now, Khan’s company two new lines of business form
So in 2012, she moved back to avoid the situation entirely.” prepared food in only one 45 percent of all Hampstead PHOTOGRAPH COURTESY OF THE HAMPSTEAD KITCHEN
her hometown of London and Khan’s emergency fund way—cooking, serving, and Kitchen revenue.
began a private dining busi- could cover slow months and creating an in-home experi- “In a way,” she says now, “this
ness. Celebrities, royalty, and equipment failures but not this ence. But clients had also asked was a blessing in disguise.”
other big spenders could hire bill. However, she did have one for a dialed-down version, for Not only is it bringing in more
her team to serve sumptuous form of preparation: a database casual evenings that didn’t money, but it’s given her more
meals in their homes—at a cost of every request customers had require waitstaff. She saw freedom to travel to and set
of up to $5,000 per person. made. It would turn out to be potential there. By delivering up high-end events—thereby
She named it The Hampstead the key to her solution. She food at a lower cost (along earning even more. “It means
Kitchen, and it thrived for five needed new lines of revenue— with the dishware and table that I’m working smarter.”
years…until a $200,000 tax to make more money, make it settings, all of which would
bill almost ruined everything. faster, and diversify her offer- be picked up later), she’d give Hear Khan on our podcast
For all her success and finan- ings—and her database told her her full-service London clients Problem Solvers, available
cial savvy, Khan had a common exactly what people wanted. more opportunities to buy. It on iTunes or wherever you
vulnerability: Her business Two opportunities stood out. would boost repeat business. find podcasts.
26 / E N T R E P R E N E U R . C O M / September 2018
Six Ways
1/ Firing your first. 2/ Rewarding talent. 3/ Breaking up. 4/ Anticipating 5/ Walking away. 6/ Outgrowing
“I had to fire my first “We preach and prac- “My cofounder and I challenges. “Leaving my firstborn— partners.
employee after four tice homegrown devel- decided to part ways. “As we grew from just Rent the Runway, which “The manufacturing
years of working opment at &pizza. I’ve Sometimes that can be us two owners to a I cofounded—to start partners we work with
together, three of which more than once had to the end of a company, team of employees, we my new company, are essentially team
were just the two of us. decide between two but we worked hard to had to set true bound- Jetblack, was very members. [As we grew],
She had certain skill deserving internal can- make this a transition aries and expectations. hard. I’ve always been an early partner couldn’t
sets that were great didates for an open that would not negatively What happens when an a serial entrepreneur at keep up, and we had to
[when we started], but leadership position, and impact our brand and employee is late or heart, but I knew I break the news to these
as we grew, they actu- each time, I’ve tried to employees. Rather than doesn’t meet expecta- would carry this deci- guys, who’d been with
ally conflicted with create a position for shying away from the tions? We didn’t have sion with me for years. us since day one, that
where I saw the busi- both of them—ones hard conversations, I an HR department, so The most important we were leaving them. It
ness growing. It was that suit their individual dove in to find a resolu- we created well-crafted thing was ensuring that was painful—there
tough—there was a strengths. Instead of tion within 24 hours. It handbooks and the relationships with were dozens of people
sense of loyalty that sacrificing a deserving started with one-on-ones contracts. If we didn’t my team and cofounder at that facility who
was hard to get over. talent, we want to with our entire team. We fix things while we would remain intact. touched our products.
But consulting with my create a space for that walked around a nearby were small, it would be Staying involved as a But now, we’ve scaled
advisers and being talent to thrive.” park until each person harder to adjust.” board member, and well beyond that phase,
honest about what I —MICHAEL LASTORIA, had all their questions —SARAH BAUCOM, avid customer, of Rent and we’ve recently
wanted for the future of cofounder and CEO, and concerns answered. cofounder, Girl Tribe the Runway has eased gone back to them for
the company helped &pizza I think I walked 10 miles the transition.” prototyping work.”
me stick to my that day.” —JENNY FLEISS, —KYLE HOFF,
decision.” —SHANNA TELLERMAN, cofounder and CEO, cofounder and CEO,
—DENISE LEE, founder and CEO, Modsy Jetblack Floyd
founder and CEO, Alala
Don’t Know
What Your
Customers Want?
Ask Them!
Three entrepreneurs share their smart (and sometimes
painfully simple) approaches to finding out how
to better serve their customers. by S T E P H A N I E S C H O M E R
WHEN FRED STEVENS-SMITH and his AFTER HER MOM TOLD her about the IN 1996, Keith Krach was cofounding
cofounder, Russell Smith, were accepted incontinence issues many women face as a startup called Ariba that wanted
into Y Combinator, they thought they had they age or have children, Joanna Griffiths to digitize the procurement process.
a brilliant idea: Help businesses track could think of nothing else. “I was 26, so (Back then, it was all done on paper.)
(and curb) money spent on Amazon Web none of that had been on my radar,” she Krach’s team was eager to start
Services. But when they got their program says. While working toward her MBA, she working, but his VP of engineering
in front of beta testers, users shrugged. set out to build leakproof undergarments. refused to build a prototype until they
“It just wasn’t a big enough problem,” Griffiths wasn’t sure where to start, so she had input from at least 60 potential
3 WAYS TO
JUMPSTART A
CUSTOMER-FIRST
CULTURE
At this startup, culture and values empower 2 VALUE THE VOICE OF THE CUSTOMER.
each employee to do what’s best for customers.
Understanding the importance of customer communications,
Buffer conducts quarterly tone audits to make sure everyone
Founded in 2010, social media is providing exceptional customer experiences. These audits
management platform Buffer has no review everything from greetings and closings, problem
physical headquarters, but has people solving, word choice, empathy, and more.
working remotely from far-flung places
including Madrid, Singapore and Sydney. The idea is to “meet the customers where they are,” Seiter says.
This fully remote, global team has to find ways to stay “If someone is in a rush, or angry, and if our response back
connected, creative, and energized. to them is full of smiley face emojis … even if we solve the
problem, are we really listening?
That means ping-pong tables and happy hour parties
won’t cut it. “Culture and how it relates to our values is “Our team thrives on activities to make ourselves even one
constantly on our minds, being discussed and evolving,” percent better,” Seiter adds, “creating a culture where that’s
says Buffer’s Director of People, Courtney Seiter. not scary, but is fun to do.”
One thing Buffer’s founders and managers realized:
The workplace culture that binds them together can 3 PROVIDE CREATIVE PERKS.
also directly influence the quality of support and overall
experience they provide to customers. Buffer employs Everyone at Buffer gets a free Amazon Kindle and can receive
around 80 people, 20 of whom work specifically in as many books as they want. Sounds great, but there is a method
customer service. behind the generosity—and one that benefits customers.
“If teammates choose to read fiction, they can gain empathy
Here are three ways Buffer’s culture and values help through the act of diving deeply into someone else’s story
drive exceptional customer experiences, which you and attempting to understand their reality,” Seiter explains.
can leverage at your own company: Many teammates also choose non-fiction books that are
more applicable to business and customer support.
1 FOCUS ON CONTINUOUS IMPROVEMENT.
One example is How to Win Friends and Influence People, by
Personal development time is scheduled in a four-hour block Dale Carnegie. “It’s like a manual for making people feel great
once every week, encouraging Buffer’s employees to disconnect about the interactions they have with you,” Seiter says. “If a
so that “they can reach the deeper state of focus often needed teammate is able to enhance their empathy, productivity,
for growth,” Seiter says. or marketing knowledge, that’s going to be a win for all the
customers they come into contact with.”
Employees have used this time to take courses, read books, and
work on special projects. Most of this time is spent learning new
skills that directly impact the customer experience, Seiter explains.
For instance, one customer support team member sought to
learn more about engineering so they could have a better
understanding about how errors are fixed. Another person
learned about social media strategy to help guide customers
to greater success, Seiter says.
These tips are brought to you by The Hartford, a leading provider of small business insurance
for more than 200 years. For more insights and advice, go to thehartford.com/smallbizahead.
Survey Says
W
hen I say that my wife and I wrote a novel together, people’s first reaction is almost universal: “You’re still married?” The idea
seems terrifying—but we loved it. The project took us three years, and though we had disagreements along the way, we kept
each other motivated and focused. (And it’s coming out this October! It’s called Mr. Nice Guy.) If it worked for us, I suspect it
could work for many entrepreneurs. Ambition can be a lonely road. Isn’t it nice to have support?
This got me wondering: How many people work with friends and family—and how’s it going for them? To find out,
Entrepreneur partnered with SurveyMonkey Audience to survey 1,007 people across America. Of those who said they had a business
relationship with someone close to them, most (67 percent) worked with a friend. That was followed by a spouse or romantic partner
(43 percent), and then immediate family: a parent or child (32 percent), or a sibling (23 percent). Here’s what everyone said.
78%
say they’ve worked with a close friend,
87% say it was a
41%
say it strengthened their relationship
14%
say it led to permanently
family member, or significant other positive experience (only 14% say it pushed them apart) damaging a close relationship
73%
You’re
comfortable
together
72%
You
trust each
48%
Dedicated
to mutual
success
43%
Spend
more time
together
59%
No separation
of work and
56%
Potential
damage to
33%
Too Harder to
comfortable, make tough
personal life relationship lose motivation decisions
31%
54%
C R E AT I V E P R O J E C T S
other Second best: organizing events
PHOTOGRAPH BY ISTOCKPHOTO.COM/FIL ADENDRON
68%
Establishing
65%
Allowing
48%
Setting aside
53%
Respecting
35%
Not making
34%
Respecting
24%
Establishing
51%
EMPLOYEE/MANAGER
clearly defined for constructive nonwork confidentiality any exceptions financial a process R E L AT I O N S H I P
roles and criticism time to spend to rules arrangements for an exit Second worst:
responsibilities together making financial decisions
32 / E N T R E P R E N E U R . C O M / September 2018
HAVE A PROBLEM WE CAN SOLVE FOR YOU?
What’s Your Problem? TELL US AT HELPME@ENTREPRENEUR.COM
TOP 100 Be sure to check out the October issue of Entrepreneur for an unveiling of our
CANNABIS inaugural list of the entrepreneurs who are leading the way in the burgeoning
LEADERS
cannabis industry. The issue will be on sale September 18.
While there is plenty of opportunity and momentum for “You need to be able to get to the edge of the cliff and
entrepreneurs who want to stake a claim in the green decide that you are going to jump. Since you don’t
game, the real question remains: Are you ready? Here always know where the landing spot is, your challenge
are some questions to consider: is to build a hang glider and eventually turn that hang
glider into a plane and, ultimately, a jet,” says Derek
ARE YOU COMFORTABLE WITH RISK? Riedle, founder and CEO of the cannabis and lifestyle
Support for cannabis legalization in the U.S stands at media company Civilized.
a record high. In April 2016, CBS News released a poll
showing that 61 percent of Americans believe mari-
juana should be legal. This number rose to 64 percent by
October 2017, according to a Gallup survey.
Cannabis is
the New Gold Rush Image credit: @samgodly
Matthew Morgan left a thriving was seeing its regulations Without serious dreams, you’ll never create
improve. serious change.
real estate business to jump head
first into the cannabis industry. How is working in this :KDWDUHWKHEHQHĆWVFDQQDELVSUR
industry unique? vides to you personally?
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uncharted territory. You’re using cannabis and CBD to help with my
Like most successful entrepreneurs, Mat- trailblazing more than anything, and you chronic insomnia. However, sleep is not
thew Morgan knows how to pivot. When the don’t have a playbook of the right moves something that you get much of as an entre-
Montana native realized college wasn’t the to make at the right time—but that’s what preneur; I enjoy being awake—realizing my
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electrical union. Then the excitement of real while they pass by in my head.
estate beckoned, so he heeded the call and I enjoy the challenges just as much as I
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quick success at his new profession, he made with ever-changing regulations, banking preneurs looking to break into the
one more forward-thinking move. issues, and emerging tax laws, the cannabis
industry is one that forces you to be
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the new gold rush.” right now, but these were forged by many
before us who took tremendous risks. This is
How is Green Axis helping
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you innovate? their stripes.
cannabis-related companies, one of which—
Reef Dispensaries—operates six retail lo- Morgan: Green Axis is an incubator—not
cations, two manufacturing plants and two VLPSO\DSDVVLYHLQYHVWPHQWˋUP*UHHQ What’s your vision for the future of
laboratories, with more than 400 employees. Axis helps fund, grow, and distribute can-
nabis through controlling interests in our
cannabis?
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His latest venture is Green Axis, an invest-
look for differentiators, and we provide the will be almost completely recreational. Not
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ymous with cannabis entrepreneurship.
rolodex in the industry to make I see the biggest growth coming from the
Here’s how he plans on making that happen.
something happen. oil, vape, and edible markets, leaving the
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Why did you move from real estate proverbial pie.
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due to market conditions and bad regula- Morgan: Isn’t that everybody’s goal? I don’t that happen.
tions. Rather than cling to a sinking ship, I believe any entrepreneur plans to build a
chose to swim and catch a rising tide that business that doesn’t expand.
STAYING POWER:
Keys to Building the Best
Consumer Brand in Cannabis
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ou can either pick a location become rich, and that is far from up his company as an example.
3 TIPS
FOR HARNESSING
INNOVATION
Futurola evolved from a coffee
shop in Amsterdam into an
international cannabis lifestyle
company. Here’s how constant
innovation made it happen.
4 4 / E N T R E P R E N E U R . C O M / September 2018
MEET THE NEW
Where will the next wave of innovation come from? Trick question: It’s already here.
Meet nine entrepreneurs aged 20 and under who are making gains in giant industries.
“ I FE LT LI K E I H AD N OT H I N G TO LO S E ”
G R O O M I N G , E L AY N A B A C H M A N ; J E W E L R Y, D AV I D Y U R M A N ; D R E S S , N A N E T T E L E P O R E ; E A R R I N G S , S U G A R F I X B Y B A U B L E B A R .
Tom, are here approving printouts of their upcoming Zollipops—in a sense, becoming her employees. Her mom, Sue, who
advertisements in Kroger’s September catalog. “I think used to work in sales, now serves as the official “stylist and sched-
we can change the coloration here to be more flattering ule organizer.” And Tom, who spent several years as a consultant
to her complexion,” she says, pointing to the face of her with Deloitte and still does consulting, is Alina’s manager. As they’ve
younger sister, Lola. “Also, let’s position the Zollipops in watched her develop as an entrepreneur, they’ve come to see her youth
a lunch bag along with a few other healthy items like carrots, snap as an unexpected advantage. Yes, sure, it gets her on television. But
peas, maybe strawberries, so people understand that they’re good for even more important, it makes her fearless.
you.” Her father suggests that it might be wise to incorporate Kroger’s “Uninhibited. That’s how I would describe her,” says Sue. “Alina
own brand of products into the ad. He pauses, trying to remember the hasn’t had five or 10 jobs where you had to follow this rule or that rule
brand’s name. “Simple Truth!” Alina chimes in immediately. “And I or do things in a certain way.” Tom agrees. Having worked for major
agree; it’s good for our relationship with Kroger to use their products.” brands, he sees the way his daughter benefits from inexperience. “Kids
Whether she’s conscious of it or not, this is Alina’s charm, and ask really good questions,” he says. “They don’t have the same kind of
clearly her sales genius. It’s why she’s invited onto the likes of CNN, baggage adults do, so they don’t see limitations.”
NPR, and Fox Business and can win over the buyers of national retail- Alina admits that not everything came naturally. “When I started
ers like Walmart and Jewel Osco—not just because of her products going on television, my answers were really scripted because I was so
(which are tasty!), but because she uses her age to her advantage. She’s young, but as I’ve gotten older and learned more about the business,
a perfectly calibrated contrast, the “kid entrepreneur” who occupies I’ve become more spontaneous.” (And it took a few years for her to
both roles and speaks both languages. “Sometimes my friends will tell appreciate just how powerful a marketing tool her TV appearances
me they saw me on television, but other than that, I’m just like every- were.) But in building a business, she always felt liberated. “I really
one else,” she says. “That’s how I want to be.” didn’t see the risk, because I felt like I had nothing to lose,” she says.
It’s a powerful trick. And after six years in the candy business, it Nowadays, Alina and Tom do most of their pitching at sales con-
comes naturally. ferences and trade shows. They attend four to six a year, and depend-
The idea for the lollipops, her company’s first product, came to ing on her schedule, Alina may present the product herself or have a
Alina back in 2012, when she was just seven years old. As the nation- broker present on her behalf. And back at the office on that June day,
ally publicized story goes, on her way out of the bank with her father, that’s what daughter and dad turned manager are prepping for. On
she was offered a lollipop. Tom warned her that the lollipop would rot the schedule is a Skype session with a team of brokers helping to place
her teeth, and so Alina began wondering how to make a tooth-friendly Zollipops in retailers across Canada, and then Alina and Tom are off
version. Two years of online research, at least a hundred attempts to the airport for a quick trip to New York, where they’ll be pitching
at concocting lollipops in their home oven, stove, microwave, and Zollipops to Wakefern and ShopRite stores.
numerous plant trials later—where they tested their oven-melted Following that, Alina reminds her dad, there’s one last item: She
concoctions on commercial production equipment—and Alina and needs to be back in time for a friend’s birthday party on Saturday.
her father secured their first meeting, and ultimately their first retail After all, she has a work-life balance to keep. —Lakshmi Varanasi
46 / E N T R E P R E N E U R . C O M / September 2018
September 2018 / E N T R E P R E N E U R . C O M / 47
“I WAN T TO H E AR I F
I’M WRONG
OR IF I’M RIGHT”
RACHEL ZIETZ, 18
Founder and CEO,
Gladiator Lacrosse
“THERE ARE A LOT of bumps along
the way, but the biggest bump is
being a teenager,” says Rachel Zietz
about her entrepreneurial jour-
ney. At 13, she started Gladiator
Lacrosse to make durable, afford-
able practice equipment for her
favorite sport, and as the business
grew, her life became a balancing
“I WA N T TO S H OWCAS E A LL TH E S KI LLS I ’ V E L E AR N E D”
act. “The school day is the same as
MOZIAH BRIDGES, 16
the business day, so it’s a lot of time
management and explaining to
BRENNAN
AGRANOFF, 18
Founder and CEO,
HoopSwagg
BRENNAN AGRANOFF GREW up in
Oregon, not far from Nike’s head-
quarters—and he and his friends
loved Nike. But at the age of 13,
when his pals started sporting the
“YO U HAV E TO AS K FOR H E LP A N D A DV I C E AN D S U P P O RT ”
brand’s $14 Elite basketball socks,
ABBY KIRCHER, 18
Agranoff found the trend to be,
well, dull. They came only in muted
tones, and Agranoff wanted to stand
out. He bought a pair of brightly
patterned socks online that set him
back $40. “I wanted more, but that
Founder and CEO, Abby’s Better
PHOTOGRAPHS COURTESY OF ABBY KIRCHER AND BRENNAN AGRANOFF
September 2018 / E N T R E P R E N E U R . C O M / 49
“START I N G A C O M PANY,
T H I N G S M OV E A LOT Q U I CKER”
KEIANA CAVÉ, 20
Founder, Mare
AT 15, KEIANA CAVÉ was fascinated by
ongoing efforts to clean up the 2010 BP
oil spill. Curiosity led the science-minded
teen to ask professors at nearby Tulane
University to let her use their labs for
research, and she discovered something
nobody else had: Cancer-causing toxins
were developing in the seawater. “I ini-
tially tried to publish papers on the topic,
but it takes a long time, and academia
doesn’t have very high visibility,” says
“AGE I S N ’ T A FACTOR I N I N N OVAT I O N ”
Cavé, now 20 and a junior at the Univer-
ANTON KLINGSPOR, 18
sity of Michigan. “Starting a company,
things move a lot quicker.” She launched
her startup Mare with the intention of
finding ways to neutralize those toxins,
thereby stopping them from harming
the ocean’s inhabitants and, eventually,
Founder and general partner, Indicina Ventures humans as well. At a pitch competition
at MIT, Cavé caught the attention of a
AS A SIX-YEAR-OLD, Anton Klingspor cut his entrepreneurial baby teeth at his family’s Chevron executive, which led to a
P H O T O G R A P H S C O U R T E S Y O F A N T O N K L I N G S P O R A N D K E I A N A C AV É
abrasives-manufacturing company, routinely attending board meetings in his kiddie-size suit $1.2 million investment and helped her
and tie. “There’s a picture of me drinking a sippy cup of OJ and programming,” he says. By build a team of 14 employees. Earlier
the time he reached junior high, he was dabbling in his own ventures, most notably creating this year, Mare was acquired by an oil-
a website with proprietary software that allowed his classmates (for a modest fee) to cut the and-gas corporation, and that exit has
line at the Adidas website to purchase in-demand Yeezy shoes. (He never heard from Adidas, given Cavé the financial freedom (and
but Klingspor has received a few cease-and-desist letters from other companies following time) to focus on her next project: devel-
similar programming ploys.) And in late 2016, with personal capital from earlier enterprises oping a nonhormonal, over-the-counter
as well as family investments, Klingspor launched the Miami Beach–based Indicina Ventures. contraceptive pill. “Bye-bye energy, hello
The company’s function is twofold, as both an incubator and a venture capital firm, but its drugs,” she says, laughing. She’s hush-
mission is singular: Help foster the ideas of young entrepreneurs who are not taken seriously hush about details but says industry
by traditional VCs. “Age isn’t a factor in innovation,” says Klingspor, who is focused on tech partners are already helping her work
startups and is particularly keen on companies that help Gen Zers create YouTube presences, to make this a reality. Once again, she
soup to nuts. “If you walk into any kindergarten class and say, ‘What does everyone want to hopes that starting a company will help
be when they grow up?’ the answer is ‘YouTuber,’ ” he says. Currently, Indicina’s assets total her do what a published scientific paper
$53 million, and the company’s portfolio includes everything from an AI startup to a talent could not: “The same way I was able to
management business. Klingspor is now looking for the right partners to help manage it change mindsets about approaching oil-
while he undertakes another lofty pursuit—completing his bachelor’s and master’s degrees in spill cleanup? We just have to change
four short years. “It sounds fanciful, but that’s the goal.” mindsets again.”
50 / E N T R E P R E N E U R . C O M / September 2018
“I H AV E T H E LU X U RY
O F T H I N K I N G B I G - P I CTURE”
ISABELLA
ROSE TAYLOR, 17
Founder and CEO,
Isabella Rose Taylor
LIKE ANY ENTREPRENEUR, Isabella
Rose Taylor has had her fair share
of highs and lows. She launched her
fashion brand for young women
when she was eight and quickly
landed in local retailers and bou-
tiques. In 2015, Nordstrom came
calling, and her designs spread
across the country. But as sales
rose to the high six figures, Taylor
struggled with sourcing and man-
“TH E RE ’ S A LWAYS S OM E TH I N G TO L E AR N ”
ufacturing as she tried to scale on
ZANDRA CUNNINGHAM, 17
the fly. “The Nordstrom deal forced
us to handle growth very quickly,”
P H O T O G R A P H S C O U R T E S Y O F Z A N D R A C U N N I N G H A M A N D I S A B E L L A R O S E TAY L O R
September 2018 / E N T R E P R E N E U R . C O M / 51
→ FACTORY FOREMAN
Kairos founder
Ankur Jain is finding
problems in
need of startups.
THE
SOLUTIO
FACTOR
52 / E N T R E P R E N E U R . C O M / September 2018
KAIROS
is a company that makes
companies. And those
companies have a mission:
Identify unsexy, overlooked,
challenging industries, and
then fix them like
nobody else ever has.
by MARY PILON
ONS
RY
n a recent sun-drenched spring afternoon, and it’s because no one was asking for it. Nobody wanted it.”
O
Daniel Mishin is strolling through the town- That may be true, but Kairos also lives in its own paradox. How
house in Manhattan’s West Village where he does one marry the oft-criticized forces of technology with the real,
lives, works, and, if time allows, plays. It reeks deeper needs of consumers beyond Silicon Valley? And in industries
of Manhattan real estate envy—lofty ceil- where people have spent decades-long careers trying (and often fail-
ings, wooden staircases, gleaming appliances, ing) to solve problems, why would young entrepreneurs be expected
capped off with a roof deck and a back porch. to fare any better?
Trees line the street, where the Waverly Inn
peeks through from the view on the front stoop. JAIN IS THE FIRST to admit the irony. He’s drawing a contrast with the
Most enviable is the price tag: Residents same moneyed world he’s working alongside. His offices in the Hudson
here pay $1,900 a month per private room, Yards development capture the tension well, located inside a skyscraper
roughly 20 to 40 percent below the area aver- that’s so new that some stickers haven’t been pulled off the walls and
age for a shared apartment—but the price the windows that overlook the New York panorama have barely needed
includes cleaning services, security deposit, to be cleaned. Many of the building dwellers are, like Jain, clad in the
internet, utilities, and even some toilet- tech-casual garb of a black shirt and jeans, but there’s no shortage of
ries (among them a very lovely hand soap). suits roaming around. (Coach and Neiman Marcus are located here;
“Adult dorms? We don’t play that game,” says KKR & Co. and BlackRock are moving in.)
Mishin, who is as crisp and friendly as his Jain tells me about his childhood in Seattle and early exposure to
surroundings. “This is a home.” megacompanies like Microsoft and Boeing, both in his zip code and
His neighbors know they have Mishin to in his household. His father is Naveen Jain, the founder and former
thank for the living arrangement. It’s the CEO of InfoSpace, a company that boomed and busted with the dot-
product of his company, Residenz, which com bubble and a flurry of lawsuits. His father went on to cofound
aims to create affordable urban housing for young professionals. Moon Express, a lunar exploration business, and Viome, a nutritional
But many residents may not be aware that there’s a force behind genomics company. Jain’s mother, Anu, is an entrepreneur and a
Residenz—and it’s the same force behind a growing number of philanthropist focused on women’s rights, science, and technology.
buzzy startups run by young, ambitious founders. His literal DNA, a mix of private and public partnerships, was part
It’s called Kairos. In the past 18 months, it has produced four of what fueled Jain to attend Wharton’s undergrad program in 2007,
startups and invested in 16 more, and it has aggressive plans to where he says he was surprised to find most of his classmates gunning
keep growing. for investment banking gigs rather than starting their own businesses.
Kairos (Greek for “opportunity”) is a decade-old, New York– But then the financial crisis began to dawn. “All of my smartest friends
based concern with origins that are not surprising (Wharton) but an were panicking,” Jain says. But he was seeing an important shift: Big
approach that is. The company is part venture capital, part mentor- business was being demonized, new startups like Facebook were being
ing group, part elite society, and it’s leading a war of ideas aimed at celebrated, and the recession was highlighting society’s fault lines. It
the kind of young entrepreneurs who was “a crazy, lucky combination of fac-
would traditionally be lured into the tors,” he says, which led some of his
highly paid, snack-filled sanctuaries of
Silicon Valley’s Notification Industrial Kairos is now friends to ask themselves a question:
Why don’t we come together and work
Complex. Kairos’ very different pitch
goes like this: There is enormous
launching on companies that can solve problems?
In 2008, Jain and some fellow stu-
untapped opportunity, and poten-
tial profit, in unsexy industries like
a new startup dents launched Kairos as an incubator.
To gain support, they tried to orga-
elder care and rental security deposits,
where innovation can literally change
every nize a meeting of Wharton minds and
business leaders aboard the aircraft-
people’s lives. The key to success there
is to reverse the typical Valley devel-
few months. carrier-turned-museum Intrepid, in
New York City. Jain sent out 50 letters
opment process. Rather than create a to CEOs, and while walking to class
product and then sell it to consumers, one day, he received a call from Phil
Kairos wants founders to identify real Condit’s office. “I could not for the life
problems faced by consumers and then engineer their solutions. of me remember who it was at the time,” Jain admits. Condit, it would
PHOTOGR A PH BY A M A NDA FRIEDM A N ( IN T RO PAGE )
In this way, Ankur Jain, Kairos’ 28-year-old founder and co-CEO, turn out, was the former CEO of Boeing. He’d soon become a mentor
is thinking far more Warren Buffett than Jack Dorsey. And in a short to Jain. “It was a true startup experience,” Jain says.
amount of time, his focus on the hole in the marketplace rather The incubator would grow into multiple projects, including some-
than the pitch deck has produced results. Today there is more than thing called the Kairos 50, an annual batch of early-stage compa-
$6.5 billion in companies that were founded by Kairos entrepreneurs, nies that receive seed funding of $50,000 and guidance. In 2012,
the bulk of which were started by people under the age of 30. And it’s intrigued by data and frustrated by his inability to manage the con-
been launching a new startup every few months. tacts in his phone, Jain left Kairos for a few years to launch his own
“You see a lot of people in Silicon Valley going after these big, startup, Humin, a platform that helped people manage their contacts.
change-the-world ideas,” Jain tells me at his offices at 10 Hudson When Tinder bought Humin, Jain became the parent company’s VP
Yards, looking over a wide, twinkling view of Manhattan. Jain speaks of product. (Kairos kept going under the leadership of Jain’s business
with the enthusiasm of a TED Talk, even in casual conversation, ren- partner, Alex Fiance.) The experience taught him a lot about how
dering his voice slightly hoarse yet convincing. “Ultimately, you waste product works, particularly on a large scale, but he says he missed
all this money and no one uses the product. They’re so surprised why, the birthing stage of company development. “The reason you hear me
54 / E N T R E P R E N E U R . C O M / September 2018
KAIROS’ NEW LEADERS
emphasize the pain points of consumers is [because I learned that] startup ideas Kairos will acquire and develop. There were macro
just because they use your product, it doesn’t mean they want to use issues with regulation that only governments could really deal with,
all the features you have,” Jain says. Jain says. Then there were social issues that were better addressed
So in 2017, Jain returned to Kairos full-time as co-CEO with an (or were already being addressed) by nonprofits, NGOs, and in some
idea for what is essentially Kairos version 2.0. Rather than just help cases giant, social-oriented tech companies like Apple, Amazon, and
incubate early-stage companies, Jain wanted to be directly involved Google. “When we looked at the market, we tried to focus on the com-
in building some of the most promising ones—using Kairos as a par- munities that were the most squeezed,” Jain says. “Then the question
ent company, under which new startups could grow and thrive, and is, Is [the solution] better done by a startup?”
where Jain himself would function as a cofounder of each one. And this is how, for example, a group of mostly childless 20-some-
To begin, the company would do a version of what Kairos did way things came to talk a lot about baby food.
back at Wharton when just starting out: It would set out to find big, In 2017, Kairos made a prelaunch seed investment in a startup called
overlooked problems for entrepreneurs to solve. Little Spoon, cofounded by Lisa Barnett, Ben Lewis, Angela Vranich,
and one mom, Michelle Muller. They’d seen a problem in need of solv-
THERE’S AN ATTITUDE in Silicon Valley that’s so mocked, it’s become a ing: Parents of newborns care about their children’s nutrition but don’t
recurring punch line on HBO’s Silicon Valley: Startups will make the necessarily have the time or, often, the funds to produce high-quality
world a better place. Critics say it’s a symptom of self-importance— foods catered to the child’s needs. So instead of pureeing organic meals
that tech founders see their work as critical and infinitely good, for the critical first 1,000 days of a child’s dietary life, most parents are
regardless of what their actual product is. (Canned air, anyone?) buying jarred, processed food that’s been sitting on store shelves for
Jain knows this, and he doesn’t want to fall into the trap. And months, like outdated fossils from another era—and often not neces-
frankly, he says, there are problems startups just aren’t suited to solve. sarily the right fit for an individual baby’s diet.
That’s why, as he built this new version of Kairos, he first needed to This wasn’t a hard problem to solve, they thought, but it would
build a way to identify the right problems. require new thinking. First came the partnership between two
Step one: “We do a ton of research,” Jain says. It began with pull- founders with compatible expertise: Barnett understood health
ing data, having conversations with founders worldwide, and sifting and consumer products, having spent six years as an investor and
through a sea of company proposals. Instead of looking for flashy operator, including at Sherpa Foundry, Maveron, and Dorm Room
pitch decks, or just nodding in agreement about the depth of a prob- Fund, and before that through her experience at Estée Lauder and
lem, Jain and his team looked at how or if a startup was the best way Boston Consulting. Lewis, meanwhile, knew food distribution, hav-
to solve what’s going on. Was there potential government red tape, ing cofounded the Greek yogurt company The Epic Seed and the food
and if so, could it be circumvented? Would people really pay for a distribution company Green Shoots Distribution.
solution to the problem? What was the slack being used? They saw the nutrition problem as really an issue of access and
PHOTOGRAPHS COURTESY OF K AIROS
Kairos assembled an advisory board of immense names, which time. Although many of the ingredients are available at big-city gro-
currently includes makeup mogul Bobbi Brown, NFL commissioner cery stores, parents in smaller, rural communities may not be able
Roger Goodell, Dr. Mehmet Oz, former Mexican president Vicente Fox to find the diverse set of organic ingredients for their baby’s specific
and his wife, Marta, and MetLife’s chief marketing officer, Esther Lee, nutrition needs. And if they do, many still don’t have time to prepare
among others. Together, after taking in all the research, the leaders these meals. “This issue was what some mom-preneurs were trying
collectively settled on five societal pressure points for Kairos to focus to do in their kitchens,” Barnett says, “but for them to start scaling,
on: student loan debt, cost of rent, parenting, job loss, and senior care. it would have been $14 a meal. The average household income is
(This can change. The process is repeated on a quarterly basis, Jain $69,000. We knew we had to solve for that.”
says, with the notion that it’s deploying capital on a two-year cycle.) Little Spoon built a platform it calls a Blueprint—a series of ques-
The point of this process is to ultimately narrow down the list of tions parents answer about their baby, from whether they were
September 2018 / E N T R E P R E N E U R . C O M / 55
→ BIG QUESTION
Jain at a Kairos event
that brought people
together to discuss why
Silicon Valley doesn’t
tackle deeper problems.
56 / E N T R E P R E N E U R . C O M / September 2018
delivered by C-section to their head circumference, that leads to a Flex, a program that allows for caregivers to check in on a larger num-
personalized nutrition plan for each child. Then, to produce the ber of patients by visiting during their downtime. Thanks to the effi-
food, the startup has food producers ship to a production facility in cient use of time, the average family saves $20,000 annually with
Southern California, where it’s all prepared—blending, packing, and Cera Flex over traditional home-care nursing, Maruthappu says.
the same cold pressure processing (to help kill off any remaining bac- The Kairos startup Rhino approached its problem in a similar
teria) that the expensive juice market has popularized. A proprietary way. Rhino was designed to address the problem of security depos-
distribution system then enables Little Spoon to mail the customized its, that extra month’s rent (or so) a renter must pay a landlord as a
meals to each family at about $3 per blend—about the cost of baby kind of insurance against damages. Neither side likes this system.
food at Whole Foods. It makes renting an apartment unaffordable for many people and
Little Spoon launched in November 2017 and delivers to doors in may put landlords, who just stick the funds in an escrow account, in
48 states. “That supply chain allowed us to not be just a brand for the a jam if damages from a tenant exceed the amount of their deposit.
coastal cities or the 1 percent,” Lewis says. “We were a brand accessible “It’s one of those remaining inefficiencies from an antiquated sys-
to everyone, everywhere. We knew that to fulfill our mission, we had tem,” Jain says.
to have a national footprint on day one.” To find a solution, Jain collaborated with Paraag Sarva, who was
Barnett believes that Little Spoon’s outsider thinking—no founder already working on the idea behind Rhino. He’s a New York native with
came from the baby industry—is part of what enabled its success. a varied résumé—working at Goldman Sachs, then Mayor Michael
“When you’re an expert in something, you may be trained to think in a Bloomberg’s office, then the online dating startup HowAboutWe.com,
certain way and not necessarily to ask big questions,” she says. “When and finally managing his father’s 20 buildings and 350 multifamily
you’re young, or new, you may be more inclined to ask, ‘Why do people rental units. Could they find a way to replace security deposits?
do things in this way? Why has this been the case for so long?’ ” Sarva’s solution was to replace the deposit with insurance. Rather
than pay a large amount up front, a renter would pay into a small
AS KAIROS CONTINUES to grow, its startups seem to be developing a monthly plan—say, $10 or so a month for a $2,000 rent—which could
pattern. Each searches for smaller vendors that may, on their own, hold drop as much as 40 to 50 percent after a year. That insurance would
part of the solution the startup is trying to solve—and then it coordi- cover the landlord in the event of damage. The tenant never gets the
nates them all to sing together. funds back, but in exchange, they never have to fork over a lump of
That’s been the case with Cera, for example, which plays in one of cash upon moving in, and the landlord is spared the paperwork and
business’s least exotic corners: taking care of the elderly. The startup, headaches of escrow.
based in the United Kingdom, was cofounded by Ben Maruthappu, Kairos, in addition to providing the initial infusion of cash, helped
a 30-year-old, Harvard-educated physician who previously worked introduce Sarva to the powerful real estate families of New York to
at the National Health Service. “At NHS, I kept seeing these patients pitch his idea. Rhino launched last February and is currently available
ping-ponging in and out of hospitals due to poor care at home,” in 50,000 units. “In hindsight,” Sarva says of his job as Rhino’s CEO,
Maruthappu says. Then the problem became personal when he tried “this job makes way more sense because it takes bits of things I’ve
to find care for a relative. It was expensive, and providers seemed com- learned at all those places and puts them to my own projects.”
pletely uncoordinated. “It was a night- And one of Rhino’s partners is
mare. There was this revolving door of Residenz, the company Mishin spear-
caretakers. We never knew who was headed and now literally lives with.
coming and going.” “We’re It’s essentially a property manage-
Maruthappu was once a part of the
Kairos 50, and he stayed in touch with young,” ment company that approaches land-
lords with, say, two-bedroom units
the company as he continued his work
as a doctor. He decided he wanted
Jain says. and makes a case for how they could
be divided into units for three ten-
a way to lower the cost of care while
providing more consistent service. It
“Time is ants. The company re-creates certain
spaces to meet city regulations, fully
seemed impractical to just launch a
traditional elder-care company, but he
on our side.” furnished, and puts itself in charge
of all roommate vetting, thus solv-
figured that the solution lay in coor- ing the dilemma of swapping leases
dination: Caregivers needed a way to or one ending a lease before another.
reliably and predictably get around to The extra roommate, in turn, creates
different families, thereby being available when needed and not just additional revenue, making the unit more profitable to the landlord.
sitting around costing families money while a patient sleeps, and they Residenz takes a cut of the overall rent.
needed to easily share information with other caregivers. But how? In all cases, it was a matter of giving smart, young entrepreneurs
Using Kairos cash, Maruthappu began acquiring many small nursing the power to tackle complex problems in new ways. This is Jain’s
companies. Then he developed an app for every nurse to coordinate vision coming to light. Will these startups (ahem) change the world?
PHOTOGRAPH COURTESY OF K AIROS
their work through. Maybe. But Jain knows he’s playing a long game.
The result: For $450 a week, his caregivers are scheduled to visit a “Two years can turn into 10 when you’re working on something,”
patient three times a day, and additional help can be had on demand, he says. “Companies may not take off too fast, the team may not be
24-7. Caregivers, in turn, can schedule their own hours and do things working as well as we thought, or the consumer pain we thought they
like fill out reports on their iPhones as they’re commuting home. were addressing wasn’t big or urgent enough to adopt the product.
Since it launched almost two years ago, Cera has grown to averag- But I think, for us, it’s about being comfortable with whatever sce-
ing more than 6,000 care visits a week and is growing at a monthly nario. We’re young. Time is on our side.”
rate of roughly 25 percent, Maruthappu says. The company recently
closed a $17 million Series A fund-raising round and launched Cera Mary Pilon is the author of The Kevin Show and The Monopolists.
September 2018 / E N T R E P R E N E U R . C O M / 57
Ap pr en tic es?
e r
Int s?n s?
is ta
Ass re... n t
No. T he y a
a l to young,
I S offers a de and maybe
D
E R D I A M A N for two years, same time.
t PET him the .
Futuris preneurs: Help ar company at ous residency
ntre -doll curi
bright e he next billion Valley’s most L E O NARD
build t ilico n RE W
Inside S by A N D
58 / E N T R E P R E N E U R . C O M / September 2018
→ READY TO STRIKE
Peter Diamandis (back, thumbs up)
with Strikeforcers (from left)
Cody Rapp, Brianna Lempesis,
Marissa Brassfield, A.J.Scaramucci,
and Maxx Bricklin.
→ FUTURE MAN
Peter Diamandis.
PHD Ventures founder
60 / E N T R E P R E N E U R . C O M / September 2018
PHOTOGR A PH COURT ESY OF A BUNDA NCE GROUP ( IN T RO PAGE ); PHOTOGR A PH BY EL IZ A BE T H L IPPM A N
s robots go, the three telepresence machines exchange for being at Diamandis’ beck and call, they gain access to
that wheeled themselves into a conference a constant high-bandwidth download of entrepreneurial wisdom.
room in Culver City, Calif., in mid May After their stint comes to an end, they can choose to become “lifers”—
were not exactly what one would call life- permanently employed staff members of PHD Ventures—or go off
like. Flatscreens mounted on stilts rising to start their own entrepreneurial adventures, potentially with direct
from a mobile base, operated from afar by financial backing from Diamandis.
flesh-and-blood humans sitting in front of On one level, Strikeforce is just a fancy name for a concept—
keyboards, the robots were functionally lit- apprenticeship—that’s as old as the hills. But the relationship
tle more than sophisticated teleconferenc- between Diamandis and his millennials doesn’t fit neatly into a clas-
ing gear. Some people Skype into business sic top-down, employer/patriarch–employee/acolyte rubric. There’s
meetings, but that’s not forward-thinking a bit more peer-to-peer two-way flow than you might expect. Even
enough for Peter Diamandis. So when he as Diamandis offers guidance, the Strikeforce steers Diamandis.
gathers the dozen or so employees of his The Strikeforce members aren’t just foot soldiers in the Peter-verse;
company PHD Ventures for their monthly they’re architects of its expanding Big Bang.
meetings, the off-site participants send
robot stand-ins. n the rarefied, geeky world where tech moguls plot the commer-
I
“All right, you rebels!” says Diamandis, cialization of space and debate the pros and cons of artificially
after the attendees are all in place. “Let’s go!” intelligent robot overlords, Peter Diamandis has been a well-
He calls this assemblage his Jedi Council; he known name for decades. In 1995, hoping to kick-start the pri-
is Obi-Wan, and they are his disciples. vate space industry, he founded the XPrize, offering $10 million
Nobody blinks an eye at any of this. Rub- to the first nongovernmental group to get a three-passenger
bing elbows with robots is hardly the most ship into space twice within two weeks. In 2008, together
fast-forward aspect of existence in the with the futurist Ray Kurzweil, he galvanized Silicon Valley’s
“Peter-verse.” The job, after all, of the mostly adventurous dreamers by founding Singularity University “to
20-something millennials assembled in this educate, inspire, and empower leaders to apply exponential
room (or beaming in from New Jersey or technologies to address humanity’s grand challenges.”
Seattle) is to translate Diamandis’ futurism But Diamandis only started breaking through to a broader public
into revenue-producing businesses. consciousness with the publication of his book Abundance in 2012.
Diamandis is a serial entrepreneur, an The combo punch of that plus a widely viewed TED talk, says Dia-
author, and a public speaker who has started mandis, catalyzed “a phase change.” Requests for speaking engage-
companies dedicated to commercial asteroid mining, zero-gravity ments spiked. People started recognizing him on the street.
flight, and the extension of human longevity, not to mention the “I’d always been an entrepreneur,” he says. “My art form is starting
XPrize Foundation (which describes itself as “an innovation engine companies. But when Abundance got published, I ended up with a
[and] a facilitator of exponential change”) and Silicon Valley’s way- much higher social profile, and I realized that things I care about and
beyond-the-bleeding-edge Singularity University (more on that want to teach about were of interest.”
later). In other words, Peter Diamandis lives in the future. A future he Although Diamandis’ typical pattern is to spin off the companies he
is 100 percent confident will be great. Bring on the robots! starts to other people and not concern himself with day-to-day man-
Diamandis says the Jedi Council meeting is his favorite day of the agement, the job of leveraging his own brand, and his own message,
month, and it’s easy to see why. There’s a freewheeling sense that required attention and dedicated staff. His first step was to circulate an
anything is possible. Updates on various Dia- ad on Craigslist and MediaBistro: “Busy entre-
mandis projects are interspersed with bursts of preneur seeks online community manager.”
laughter. It’s fun to work here—it’s fun to work
in the future! Everyone here is a true believer
in the “abundance mindset”: Diamandis’ abso-
+
ADIATE
At the time, Marissa Brassfield, then 28, was
toiling in the sweatshop of online health-and-
fitness content generation. (By her own count,
lute conviction that accelerating technological THEY RNVICTION over a five-year span she wrote 15,000 articles
O
WITH CT WE ARE
change will solve all the big problems—energy, and edited another 230,000.) She saw the ad,
climate change, even mortality. followed up, learned that the entrepreneur was
It’s clear that Diamandis, 57, feeds off the THA ING ON Diamandis, read his book overnight, and nailed
humming millennial energy. But what’s a little TEETEEROF AN AGE the interview. Brassfield soon took over orga-
G
less obvious is the extent to which he has insti-
THE EDMARVELS. nizing Abundance 360, an annual conference
tutionalized this cross-generational relation-
ship. Two of the attendees at the meeting, A.J.
OF targeting well-off entrepreneurs with a three-
day event of networking and concentrated
Scaramucci, 25, and Brianna Lempesis, 26, are exposure to Diamandis’ exponential hope the-
not just regular employees. They are the latest members of a special sis. Tickets for the conference weren’t cheap—they’re now $15,000 a
group—an experiment, really, in what happens when the brightest pop—but Brassfield built up the attendance steadily year by year. In
young minds Diamandis can find are given free range within his eco- January 2018, a whopping 78 percent of the attendees renewed for
system. He calls this group Strikeforce. the following year on the last day of the conference, and Brassfield
Part 24-7 on-call executive assistants and part entrepreneurs in received a standing ovation when brought onstage by Diamandis.
residence, the Strikeforce members serve two-year terms shadowing Brassfield’s success created a template for what was to come—a
Diamandis wherever he goes while simultaneously working within parade of young and talented employees given wide latitude to exer-
(or operating their own) revenue-generating units of PHD Ven- cise their own entrepreneurial energy. But Brassfield herself is a full-
tures. They are more-than-willing participants in a quid pro quo. In time employee, a “lifer.” The formalized concept of Strikeforce wasn’t
September 2018 / E N T R E P R E N E U R . C O M / 61
created until 2013, when Cody Rapp, then an undergraduate at USC,
arrived on the scene as a prospective intern.
Rapp eventually brought his roommate, Maxx Bricklin, into the
Strikeforce fold. Then came A.J. Scaramucci, and most recently, Bri
Lempesis. Over the course of several years, the terms of the overall
deal gradually emerged. Diamandis is a big believer that to be a suc-
cessful entrepreneur, you need to have some skin in the game. So all
the members of PHD Ventures participate in a profit-sharing plan,
in which they are entitled to a share of 3 percent of the profits of the
entire group and a share of 17 percent of the profits from the business
unit they are involved with. The Strikeforce members got the same
deal, on top of a basic salary in the $65K-to-$75K range. The goal,
says Diamandis is to “double, triple, quadruple your basic salary.” And
the best way to do that was to build your own new business within
PHD Ventures.
Cody Rapp helped Diamandis leverage his multiple networks into
a platform for angel investment. Bri Lempesis expanded Abundance
360 into an all-year digital forum. Scaramucci took the lead on build-
ing out the Abundance Platinum program, in which Diamandis leads
highly curated tours of countries such as China. But by far the most
striking development was when Maxx Bricklin, at the age of 22, pro-
posed creating a venture capital fund called Bold Capital Partners.
“You’re going to have to convince me of this,” Diamandis recalls
telling Bricklin.
Bricklin had joined Strikeforce with that in mind. Once he came
to understand how a fund could fit into Diamandis’ worldview—by
investing in companies that seek “exponential transformation”—he
pitched it, arguing that the fund could leverage the connections cre-
ated by PHD Ventures’ network.
A few months later, Diamandis said yes. Today it manages two funds
that total $250 million, with Bricklin as the founding principal. Recent
investments include Insilico Medicine, which aims to use genomics
and big data to treat cancer and age-related diseases, and Metawave → FUTURE TROOPERS
Corporation, which builds radars using “metamaterials and AI.” Diamandis, geeking out.
“It would not exist had he not had that passion,” Diamandis says
of his young VC’s fund. “So part of what this is all about is me asking
Strikeforce members what they are passionate about. ‘What do you singing opera, searching for exoplanets at a local observatory, and
want to build together?’ ” conducting research on mice spleens. During college he interned at
Planetary Resources (the asteroid-mining startup cofounded by Dia-
fter just a few hours spent hanging out with Strike- mandis) and worked full-time for Tesla. Somehow he also managed a
A
force, you start pondering a basic question: Are entre- stint at Google before arriving at PHD Ventures.
preneurs born or made? As an undergraduate at MIT Fast-talking, articulate, effortlessly self-promoting, the Strikeforce
in the early ’80s, Diamandis founded the (still going) members weren’t so much drawn into the gravitational pull of the
intercollegiate organization Students for the Explora- Diamandis orbit as they were self-hurled into it via the power of their
P H O T O G R A P H B Y G E T T Y I M A G E S /A L B E R T L . O R T E G A / C O N T R I B U T O R
tion and Development of Space. His parents wanted own custom-built booster rockets. From his dorm room at Tufts, Scar-
him to be a doctor, but Diamandis ended up far more amucci watched an announcement video for Planetary Resources and
interested in marshaling the forces of business creation. decided right then and there he had to work for the startup. Around
He has started at least a dozen companies and is always the same time, Rapp read Abundance and cold-emailed Diamandis
looking for the next opportunity. seeking an internship. At her last job, at a data analytics firm, Lem-
Past and former Strikeforce members fit the same pesis decided she was too bored to do anything but jump ship to the
entrepreneurship-in-the-blood profile. Cody Rapp researched a Peter-verse. A few phone calls later, she was meeting Diamandis at
transportation service for students while studying neuroscience at the Silicon Valley’s Moffett Field airport. The first lesson one draws from
University of Southern California. Maxx Bricklin devised an innova- extended exposure to the Strikeforce is that entrepreneurship is inex-
tive electric car while still in high school. Bri Lempesis hacked her way tricable from the pure exertion of will. And you have to wonder: What
out of high school by figuring out how to get credits without attending could such a go-getting pack of self-starters learn from Diamandis?
class, taught herself the basics of cryptocurrency so she could buy a Persistence, says everyone. “The belief that you can do anything,”
fake ID on the Silk Road “dark web” emporium, and then, after skip- says Lempesis. “How to sell people,” says Bricklin. “Understanding
ping college, talked her way into a full-time job at a Palo Alto startup how the world works,” says Rapp.
that made telepresence robots (the same robots, in fact, that attended “Vision,” says Scaramucci. “Peter is the fucking Picasso of vision.”
the Jedi Council meeting). That vision—of a world of infinite possibility, a world that scoffs at
And then there’s A.J. Scaramucci (yes, he’s a son of that Scara- scarcity, a world with colonies on other worlds and hover cars and an
mucci). In high school, he occupied his hours by semi-professionally end to cognitive decline—speaks to a crucial part of the bond between
62 / E N T R E P R E N E U R . C O M / September 2018
Diamandis and Strikeforce. Everyone alive today is buffeted by a con- y the time I visit PHD Ventures in May, Maxx Bricklin
B
stant barrage of negativity, but millennials in particular have matured is fully ensconced working long hours at Bold Capital,
in an era bracketed by the recession, imminent climate change doom, from an office up the road in Santa Monica. Cody Rapp
and cartoonishly broken politics. Meanwhile, Diamandis, in addition is in the preliminary stages of starting his own company
to showing his Strikeforce what the inside of a board meeting looks but not ready to go public. (He doesn’t even want to tell
like or demonstrating the raw mechanics of startup formation, is also me whether Diamandis is investing in it.) Lempesis is
selling hope. still serving out her two-year term and isn’t sure what’s
And that, right now, is a very underserved market. next. She could easily see herself becoming a “lifer” like
“People want hope,” says Diamandis. “People want to know that Marissa Brassfield (who says Peter will never let her
the world is getting better. If I can offer them data-driven optimism, I leave) or striking out on her own.
think that’s a really great value proposition.” Scaramucci is months away from finishing his stint as
a Strikeforce commando when I arrive. Next up for him: Stanford
he morning before the Jedi Council meeting, Diaman- Business School. He is really interested in the future of artificial
T
dis delivered a keynote speech at a conference before intelligence. And biotechnology as it applies to human longevity.
an audience of 70 or so “high net worth” real estate And Chinese advances in automation.
investors. Aside from a few references to the onset of Those are all huge topics, I point out to him.
3-D-printed housing, he didn’t tailor his remarks to the “Sure, they’re huge,” says Scaramucci. “But I don’t care. I mean, I’m
industry. It was his stump speech, a gung ho elucidation going to live to at least 150, so I have plenty of time to study things.”
of the-future-will-be-better thesis. And then he laughs long and hard, as if to underline the wackiness
Diamandis believes we are not hearing about all the of it all. But at the same time, he sounds serious.
good news there is in the world because journalism is The optimism and unbridled ambition of Scaramucci and Lempe-
incentivized to give us an endless deluge of “it bleeds, sis and all the rest seem to be necessary tools in the entrepreneurial
it leads” clickbait. He’s on a mission to turn back that arsenal. Too much exposure to the real world can get you down, and
tide. In the past century we’ve doubled the human life span, he tells that’s just not useful. Brassfield theorizes that “you almost have to be
the audience. In the next century, we’ll double it again. Just a few in a bubble to protect the mindsets of people who need to be visionary
months ago, he reports, Japanese researchers exploring the ocean and creative.” Too much naysaying and you’ll never get the courage to
floor discovered deposits of the rare earth minerals crucial to our go for that moonshot.
smartphone age that are so plentiful, the whole world won’t exhaust Diamandis says the crucial elements of entrepreneurship are “hav-
them for 500 years. Scarcity is a myth! ing a vision of where you want to go, then being able to pitch it to
“Empowering individuals into an abundant future of unlimited others and raise money.” The “unfair advantage” he gives to his Strike-
potential has always been a theme for me,” he tells me later. What force corps is the ability to tag along with him and see how the game
may be most remarkable about his personality is that he has somehow is played at a high level, to see living examples of wild optimism being
managed to hold on to the same “bright, unencumbered enthusiasm” transformed into lived reality.
(his words) he felt as a child watching the first man walk on the moon. “My third week on the job,” remembers Rapp, “it was me, Peter,
The Strikeforce members absorb that enthusiasm and reflect it and Richard Branson sitting for two hours talking about space and
back with blinding intensity. Lempesis and Scaramucci, in partic- where the industry was going and what Branson was doing with Vir-
ular, both radiate with the conviction that we are teetering on the gin Galactic. I’m like, Holy shit, that’s Richard Branson.”
edge of an age of marvels. But the block-and-tackle mechanics of entrepreneurship don’t fully
The child of a computer programmer and a professor who special- explain the liveliness of the Jedi Council meeting, or the playfulness
ized in early childhood psychological development, Lempesis was with which Diamandis and the millennials banter.
practically a laboratory experiment designed to explore how much “I’m clear that this should all be fun,” says Diamandis. “This should
a motivated autodidact could learn about the world via the internet. all be aligned with one’s mission and purpose in life. This shouldn’t
She recalls having a cellphone in third grade: “It was so fascinating. be about just making money. This should be about being in line with
I had no one to talk to other than my parents, but I just thought what we call our massively transformative purpose. And if it is, then
transmitting information was so cool. Look at this little tool in my it’s a game. Then it’s joyful. It’s not work.”
hand that can contact anybody on Earth. Diamandis’ massively transformative purpose is to “inspire and guide
“I was a very strange kid,” she says, and then pauses for a moment. the transformation of humanity on and off the Earth.” But even the man
“I’m still very strange as an adult.” preaching the gospel of hope sometimes loses sight of the point of it all.
Lempesis talked her way into Suitable Technologies, the tele- And that’s when it really helps to have a 25-year-old sitting next to you.
presence robot maker, because of her faith in the transformative “Just the ability to reset and to see the world through those non-
possibilities of the internet. With these robots, a disabled person jaded, youthful eyes is a gift,” says Diamandis. “Once, I was with Cody
could transcend the limitations of the body and be anywhere. and we were rushing to a speaking engagement in Manhattan. And it
Edward Snowden could appear (with Lempesis’ help) at the was really tight, so we land at JFK and the helicopter picks us up and
Consumer Electronics Show in Las Vegas. People could connect we’re flying down the Hudson at 200 feet above the water and I’m
through technology. The same wonder she felt in third grade pounding away at emails.
was still driving her forward. “And Cody says, ‘Stop!’ He says, ‘Look out the fucking window;
What makes Lempesis an outlier is not her “strangeness” but it’s amazing! We are in a helicopter going down the Hudson! This is
her ability to hang on to her faith in technology in an environment awesome!’
where the downsides of our digital lives are increasingly well-pub- “And I was like, ‘Dude! You are so right!’ ”
licized. It’s something that all the Strikeforce members have in
common with each other, and with Diamandis. They are far more Andrew Leonard lives in Berkeley, Calif., and writes about
excited than cynical. technology and China.
September 2018 / E N T R E P R E N E U R . C O M / 63
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D
assistance for our college students
and graduates, we provide letters
ennis and Nicole Drake know how to motivate a workforce. The of recommendation, and we’ve
husband-and-wife team—a Defense Department adviser and an aero- hosted homework night for stu-
dents going into final exams—we
space engineer, respectively—spend their days working in highly sensi-
keep the café open late in the eve-
tive U.S. intelligence and defense facilities, managing projects and teams ning so our team has a quiet place
stretched across the globe. Then they turn to their side hustle, where to study. We also hold scholarship
those same skills are put to different use: They own and operate two Tropical challenges, certain days where a
portion of our sales go toward a
Smoothie Cafe stores in Virginia, employing high school and college students fund for our employees.
preparing for their future. To keep their staff engaged and working hard, the
Drakes have implemented programs, rewards systems, and scholarships to set Do you keep in touch once
they’ve moved on?
up their employees for success—at Tropical Smoothie Cafe and beyond.
DENNIS: The other night, Nicole
got a text from one of our ex-
Most of your staff are Gen Z. for a dollar or two. but I’ll also let them know that I employees, who’s in college now,
How do you recruit and hire? NICOLE: When I do interviews, want them to come to work and that said, “I’m in this business
DENNIS: In this industry, you I take the “motherly approach.” feel safe and comfortable being class. What were the methods of
have a lot of companies vying If [the candidate is] still in who they are. That’s what we customer engagement we used?”
for the same people, and there’s school, I stress that the most owe our employees. It’s rewarding—
high turnover. We have to important thing right now is NICOLE: —to know that they feel
understand the dynamic of their education. And I establish What have you learned about comfortable enough to text me at
how to hire right and keep our my expectations up front. I’ll keeping this younger staff 10 o’clock at night to ask me that
employees from moving simply tell them that I don’t like drama, engaged? question. They know it’s OK!
66 / E N T R E P R E N E U R . C O M / September 2018
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Franchisor
O
ne night in 1975, 17-year-old Peter Cancro knocked
on his high school football coach’s front door in
Ocean County, N.J. Cancro, a senior and the team’s
quarterback, was there to ask for a $125,000 loan
to buy the sub shop he’d worked at for the past four
years. Hours later, Cancro left with the loan, a seven-year
payback plan, and the intent to purchase Mike’s Subs.
Since then, he’s turned that small sub shop into Jersey
Mike’s, a national franchise with 1,400 locations nation-
wide and more than $1 billion in annual sales. It’s the
fastest-growing sandwich chain in the U.S., with more
than 18 percent sales growth year over year, according to
industry research firm Technomic. (Firehouse Subs, its
closest competitor in sales growth, achieved less than
5 percent growth last year.) But there were brutal bumps
in the road, including a dance with bankruptcy that
changed the way Cancro runs his business.
always came down, along with six people I had in the office, bills. And I worked more than what could happen, and plan for
people from North Jersey. It and that was the toughest 100 hours a week. I focused it. Show up early, stay late.
made us a little more worldly thing ever. on marketing and did a lot of
down at the shore. In the local radio because we couldn’t Most important: What’s your
summertime, the population How did you work through this afford TV. We also started some favorite sandwich?
quadrupled. We had lines out with your franchisees? direct mail campaigns and ini- The Cancro Special, of course!
the door, and we were making We met with all the individual tiated door-to-door grassroots It’s provolone cheese, roast beef,
a crazy volume of sandwiches. store owners to make sure marketing one mile around the and pepperoni, made “Mike’s
There was no Burger King everything was being done stores. Within three years, I’d way.” It doesn’t sell that much,
or McDonald’s around. We right at each location. The hired back all the employees but if you walk in and ask for
were it. business at our existing stores that had been let go. one, they know.
68 / E N T R E P R E N E U R . C O M / September 2018
Suppliers
BEST IN
SERVICE Our first-ever ranking of the top franchise suppliers,
the companies that help franchises succeed.
by T R A C Y S TA P P H E R O L D
I
P.82
t’s a line used so often in franchise marketing that it’s franchising to top-ranked Franchise 500® brands with thousands
become a cliché: You’re in business for yourself, not by of locations—to find out which suppliers they do business with
yourself. But like most clichés, it exists because there’s and how satisfied they are with them. Suppliers were then scored
more than a little truth to it. In fact, it’s true of not just based on both how many franchisors reported using them and
franchisees but franchisors as well. Few if any franchise their satisfaction ratings. The final ranking consists of the 15
companies can become national brands (let alone global top-scoring suppliers in each of seven categories—accounting,
powerhouses) without some behind-the-scenes help. banking/financing, legal services, marketing, merchant services,
At Entrepreneur, we’ve spent 40-plus years covering other technology services, and public relations.
franchising, but we’ve rarely shined the spotlight on the service Franchisors, whether you are starting out and not sure whom
providers—“suppliers,” as the franchise world usually refers to them— to use or are an established brand shopping around, we hope this
who contribute to the success of so many franchisors and franchisees. ranking will be a valuable resource for you. But we offer the same
Now it’s time to change that. We’re proud to present Entrepreneur’s word of caution we always give prospective franchisees when we
inaugural ranking of the top franchise suppliers. rank franchises: This list is not intended as an endorsement of any
To find out who the top suppliers are, we surveyed hundreds particular company. Instead, take it as a first step in your research
of franchisors—from brand-new companies just jumping into to find the suppliers that best fit your and your franchisees’ needs.
September 2018 / E N T R E P R E N E U R . C O M / 71
Suppliers Service descriptions come from respective suppliers.
ACCOUNTING
AUDITED FINANCIAL STATEMENTS are a required—and vitally important—item in the franchise disclosure documents (FDDs)
that are shared with prospective franchisees, so a good auditor is indispensable. And—as with any business—tax, advisory,
and other accounting services are essential as well. In our ranking, you’ll find the “Big Four” accounting firms, naturally, but
there are also smaller firms, including some that specialize in working with franchise companies.
1 10 11 13 14 15
Deloitte The A. Andrew DHG CLA Baker Tilly
Audit and assurance, Franchise Gianiodis, CPA (DIXON HUGHES (CLIFTONLARSON- Audit, tax, accounting,
tax, legal, risk and CPA Audit, tax, and GOODMAN LLP) ALLEN LLP) and business and
financial advisory, and business consulting transaction advisory
Financial statement Assurance, tax, and Wealth advisory,
consulting services services
audits, royalty audits, and advisory services outsourcing, audit, tax,
part-time CFO services and consulting
2 12
BDO USA, LLP CohnReznick
Accounting, tax, and
Audit and tax compliance,
advisory services
tax strategy, mergers and
acquisitions, international
consulting, royalty audits
3
EKS&H LLLP
Audit, tax, technology, and
consulting services
4
EY
Advisory, assurance, tax, and
transaction services
5
Grant
Thornton LLP
Audit, tax, and advisory
services
6
KPMG LLP
Audit, tax, and
advisory services
7
RSM US LLP
Audit, tax, and
business consulting
P H O T O G R A P H C O U R T E S Y O F D E L O I T T E L L P.
8
PwC
Audit, assurance, consulting,
and tax services
DELOITTE
9 The largest professional services network in the world by revenue and number
Plante Moran
Audit, tax, wealth of professionals, Deloitte provides accounting services to more than 85 percent of
management, and
business consulting the Fortune 500 and more than 6,000 private and middle-market companies.
services, including
transaction advisory So it’s no surprise that among its clients are a number of major franchise brands.
72 / E N T R E P R E N E U R . C O M / September 2018
NOBODY THEY’RE
UNDERSTANDS PARTNERS THAT
FRANCHISE TRULY CARE
DEVELOPMENT ABOUT OUR
LIKE THEY DO. BUSINESS.
Tim Muir, FOCUS Brands® Leigh Ann Stump,
Bojangles’®
WE WORK WITH!
SPEAK Tina Bacon-DeFrece,
BANKING/FINANCING
OBTAINING FINANCING can be one of the biggest hurdles to starting a business. One advantage of starting a franchise busi-
ness, though, is that many franchisors have relationships with banks and other financial institutions they can refer their
franchisees to for help. These are the financial providers franchisors trust the most to help their franchisees get up and
running and keep them funded for the life of their business.
1 3 5 7 8 10
Chase for Bank of America Benetrends TD Bank U.S. Bank BBVA
Business Small-business banking, Financial Term loans, lines of credit, Business banking, Compass
Deposit accounts, loans, credit, and cash 401(k) rollover funding, commercial real estate conventional and SBA Banking solutions for
credit cards, and cash management solutions SBA loans, and mortgages, franchise financing, credit card and franchisors, franchisees,
management equipment leasing acquisitions/buyouts/sales, payment solutions, wealth and independent chains
SBA loans, merchant management services
4 services, credit cards,
13
DCV
Franchise
Group
Franchise financing
and franchise
consulting services
14
Fifth
Third Bank
Banking services, including
deposit products, loan
products, credit cards,
payment solutions, and
wealth management
15
PHOTOGRAPH COURTESY OF CHASE
BB&T
CHASE FOR BUSINESS Retail, commercial,
and corporate
banking, investments,
insurance, and
wealth management
“We have always had a wonderful relationship with Chase. Actually, our Chase
banker was sitting on the floor of my apartment when we purchased the D.P.
Dough brand from the founder. The company and its technology are great.
But the people make it stand out.” —MATT CRUMPTON, president and CEO, D.P. Dough
74 / E N T R E P R E N E U R . C O M / September 2018
FISHERZUCKER
POWERING THE
FRANCHISE 500
What do the country’s fastest growing franchisors have in common? They rely on FisherZucker. Our lawyers are dealmakers,
litigators, negotiators, and architects of creative alternatives to navigate franchise obstacles. And we have the awards to
prove it. Are you growing as fast as you should? Let us show you how we can rev up your franchise today.
LEGAL SERVICES
FRANCHISING COMES with its own unique set of legal challenges, starting with the need to draft a complicated legal
document—the FDD—and update it every year. So it’s no surprise there are a large number of law firms that specialize in
working with franchises, offering help with everything from dispute resolution and trademark protection to mergers and
acquisitions and international expansion. In this highly competitive category, these are the firms that came out on top.
1 8 10 12 14 15
Gray Plant Mooty Harold L. Carter & Tani Law Offices of Stark & Stark, Warshawsky
Full-service law firm Kestenbaum, Transactional legal services Carl Khalil & PC Seltzer, PLLC
with a franchise and P.C. for franchisors, master fran- Sada Sheldon Full-service franchise Franchising, licensing,
distribution practice team chisees, and Illinois-based law firm offering corporate, outside
Transactional legal Franchise and trademark
franchisees and businesses preparation of franchise general counsel, and real
representation legal services
for franchisors disclosure documents, estate legal services
2 11
regulatory compliance,
FisherZucker
9 Haynes and
13 trademark legal services,
and dispute resolution
LLC Quarles &
Full-service franchise law Mullin Law, PC Boone LLP Brady, LLP
firm offering pre-litigation Transactional and Domestic and international
Full-service law firm
counseling, litigation, arbitra- commercial litigation franchise and distribution
offering transactional,
tion and mediation, non-com- representation for franchi- counseling, development,
regulatory, and dispute
pete, antitrust, collections, sors and franchisees expansion, and dispute
resolution services
regulatory compliance, trade- resolution
mark protection, mergers and
acquisitions, due diligence,
and international and domes-
tic transactions
3
DLA Piper LLP
Legal services including
franchise law compliance,
mergers and acquisitions,
and dispute resolution
4
Drumm Law
Full-service
franchise law firm
5
Faegre
P H O T O G R A P H B Y T R E L E V E N P H O T O G R A P H Y/ G R AY P L A N T M O O T Y
Baker Daniels
Full-service franchise law
firm offering mergers and
acquisitions, litigation
and dispute resolution,
international expansion,
privacy/cybersecurity,
regulatory compliance,
and other services
76 / E N T R E P R E N E U R . C O M / September 2018
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Suppliers Service descriptions come from respective suppliers.
MARKETING
FRANCHISORS HAVE a wide variety of options when it comes to growing their brands through marketing, from traditional
marketing agencies to those that provide marketing software and other tools. Many focus on digital marketing or social
media, while others offer a broader range of services. And some are geared toward attracting customers, while others aim to
recruit franchisees for their clients. Whatever the marketing need, there’s a supplier to fill it.
1 3 4 6 7 9
Scorpion Integrated Qiigo Marketing SOCi Inc. Web.com
CMS, web design, and Digital Digital marketing for 360 Social media and reputation for Enterprise
digital marketing solutions Strategies multi-location brands Digital marketing management for Custom digital solutions
and services software and services multi-location brands for franchise networks
Digital marketing company
specializing in franchise
2 development and 5 8
franchisee marketing Adfinitely 10
Hot Dish Marketing campaign SeoSamba Wheat
Advertising management Franchise marketing Creative
Full-service platform
Franchise marketing
advertising agency strategy, development
websites, and creative
and digital collateral
11
Brand
Journalists
Franchise development and
lead generation marketing
12
Franchise
Performance
Group
CEO advisory services,
franchisee recruitment
services including digital
marketing and lead
generation, and strategic
banking relationships
13
Sociallybuzz
Social media reputation,
management, and
campaign company
14
Rallio
Social media and reputation
management technology
PHOTOGRAPH COURTESY OF SCORPION
15
SCORPION ClickTecs
Franchise websites and
digital marketing services
“Scorpion simply does things right. They demonstrate class in all they do. We have
been impressed at almost every turn with Scorpion, from the caliber of the people
they find and hire to the detailed way in which they support our company’s goals.”
—BRIAN CLARK, president and CEO, Service Team of Professionals (STOP)
78 / E N T R E P R E N E U R . C O M / September 2018
Suppliers
MERCHANT SERVICES
THE ABILITY TO securely process payments is crucial for every modern business, and here again, franchises have a large
selection of suppliers to choose from. There are big companies and banks that serve a variety of business customers, as well as
companies that serve only certain industries. When searching for the right merchant service provider, franchisors should also
consider what other services they offer, such as loyalty programs.
1 3 5 7 9 11
Worldpay Inc. First Data Franchise Chase Stripe Authorize.Net,
Payment processing, Payment processing and Payments Merchant Payments infrastructure A Visa
software solutions, reporting technology solutions Network Services and business applications Solution
and data analytics, fraud
Payment processing and Payment processing Payment processing
monitoring and protection,
gift/loyalty programs and management system
gift and prepaid card
solutions, consulting, and
4 for franchise chains 10 for businesses
professional services Bank of 8 PayPal
America TSYS Payment technology and
Merchant 6 software solutions 12
2 Services Global
Payment solutions
PNC
Square Multi-channel payment, Payments Inc. Merchant
Payment processing, e-commerce, and (HEARTLAND) Services
reporting and analytics, security solutions Payment technology Payment processing
POS software, and and software solutions solutions
business services
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Sysco
WORLDPAY INC.
Point-of-sale restaurant
technology platform and
payment processing
“Worldpay has been a valued
vendor for You’ve Got Maids
14
US for a couple of years. They
Merchant exemplify the type of company
Systems
Credit card processing,
POS systems, gift and
that believes in the importance
loyalty card programs,
cash advances, and
of customer relations and
P H O T O G R A P H C O U R T E S Y O F W O R L D P AY, I N C .
1 3 5 7 9 11
FranConnect HubSpot Intuit Zoho FranchiseSoft MINDBODY
Franchise management CRM, marketing, sales, and Franchise Cloud software suite and Franchise management Technology platform for the
software customer service platform Program SaaS applications for software, including fitness, wellness, and beauty
business franchise development services industries
Accounting, payroll, and
CRM, operations, and
payment solutions for
2 4 franchisees
8
financial components
12
Naranga Salesforce
Franchise management CRM, cloud computing, sales, FRM 10 Vonigo
solutions service, marketing, and
analytics apps
6 Solutions
Software solutions for Infusionsoft
Business management
software for mobile service
Microsoft managing relationships CRM, sales, and marketing franchises
Intelligent cloud, CRM, and software
between franchisors and
software solutions
existing/prospective
franchisees
Service descriptions come from respective suppliers.
13
Revel
Systems
FRANCONNECT
Point-of-sale platform for
managing restaurant,
quick-service, and retail
operations “For years, AtWork did not have any kind
of company intranet platform, and we
14 were afraid that if we tried to develop our
NCR
Self-service kiosks, POS own, it would be challenging to maintain
terminals, ATMs, check
processing systems, and stay relevant. I started doing my
barcode scanners, and
business consumables research, and immediately FranConnect
PHOTOGRAPH COURTESY OF FRANCONNECT
PUBLIC RELATIONS
IF THERE’S ONE group of franchise suppliers we at Entrepreneur knew well before we put this ranking together, it’s this one:
PR agencies. They’re the ones emailing us daily, working hard to tell their clients’ stories in hopes of publication. Some of
them even help their clients fill out their annual Franchise 500 applications and regularly update their free online listings.
And that’s just a sampling of the work they do to help franchise brands gain good exposure and mitigate the bad.
1 8 10 12 14 15
Fishman Konnect Edelman SPM BizCom Decibel Blue
Public Relations Agency Global communications Communications Associates Public engagement, public
PR and content marketing PR, franchise development marketing firm PR, crisis communications, Publicity and brand relations, social media, and
for franchise lead generation marketing, and social media social media, and influencer awareness campaigns, digital marketing for
and brand awareness relations for franchise, lead generation, franchisee franchise systems
11 restaurant, food, retail, marketing, crisis
No Limit Agency
Full-service
communications firm
4
All Points Public
Relations
Publicity, social media,
content marketing, and lead
generation strategy
5
Franchise
Elevator PR
PR services for emerging
franchise brands
6
919 Marketing
PR, marketing strategy, social
media, digital marketing, and
direct marketing
7
PHOTOGRAPH BY BUZZ ORR/FISHMAN PR
Sanderson &
Associates
Local and national media
placement, media coaching,
FISHMAN PUBLIC RELATIONS
social media, content and
crisis communications, and
growth and location
consulting for franchisors “Fishman PR always exceeds expectations. Last year, a franchisee was helping
and franchisees
an overweight dog at a local rescue shed pounds and increase the chances of adop-
tion. When Fishman PR learned of it, they secured coverage for it on Good Morning
America Online, Huffington Post, Yahoo! News, and more. This aided the dog’s journey
to a home and brought recognition to Zoom Room.” —MARK VAN WYE, CEO, Zoom Room
84 / E N T R E P R E N E U R . C O M / September 2018
DON’T
PAY
FOR
BIG
PLANS
PAY FOR BIG RESULTS
Fishman PR. The largest and most trusted PR and content marketing
firm in franchising, driving franchise leads and franchisee growth for
over 25 years.
The New
Con Job Eight years ago, Ally and Scott Svenson started hiring
felons to staff MOD Pizza. That turned out to be
one of the best business decisions they ever made.
by C L I N T C A R T E R
t
here was a moment he went in for the interview. through a hole in one of his the research firm Technomic
in 2011 when Tony And anyway, he wasn’t in a $20 Payless shoes. MOD gave named it the fastest-growing
D’Aloia considered his position to turn down work. him a free pizza every day, which restaurant chain in the U.S. Last
freedom to be a curse. By the time he was in his early he traded on the street for bus year, MOD hit $275 million
In prison, where he’d 20s, D’Aloia had been arrested tokens to get to and from work. in sales, 81 percent growth over
just spent the better 38 times. Every time he was If this was life outside, D’Aloia the year prior.
part of a decade, he released, he’d go right back to wasn’t sure he was interested. MOD’s hiring practices
could survive a full jail. “I couldn’t last a week on At the time, MOD still wasn’t would come to alter every-
year on the $100 his mom sent the street,” he says. He’d get sure it was interested in him, thing about the company. “We
him twice a year, on his birthday drunk and start a fight, or tres- either. But in 2011 the com- have no interest in just build-
and on Christmas. But now that pass after-hours in the park. pany was following a few early ing another fast-casual pizza
he was outside and back home But his big bust, the one that data points, having discovered business,” says Ally Svenson,
in Washington state, he needed sent him away for more than that ex-cons could make great who cofounded the company in
money to survive—lots of it. He’d five years, was on a conspiracy employees. That would keep 2008 with her husband, Scott.
heard of job openings with ware- to distribute ecstasy. He needed proving itself out. MOD would “We’re building a business plat-
houses and construction compa- two grand to pay off a DUI fine, eventually embrace what it calls form to make positive social
nies, but nobody seemed eager to so he agreed to drive 25,000 impact hiring—people with impacts.” MOD doesn’t collect
bring on a convicted felon. pills from the Canadian border backgrounds of incarceration, numbers on how many of its
PHOTOGRAPHS BY DANIEL BERMAN
Then he finally found some- down into Washington. The job homelessness, drug addiction, employees qualify as “impact
one willing to interview him. was a sting, and D’Aloia landed or mental disability—and cred- hires,” but partnerships with
A young Bellevue pizza joint in long-term lockup. its the decision in large part with organizations like the Monarch
called MOD was hiring a dish- For some reason, MOD over- its rapid growth: In the years School, which helps find jobs
washer. D’Aloia knew zilch looked his history. The com- after D’Aloia’s hire, MOD went for people with autism and
about MOD and wasn’t excited pany met with his parole officer, from five stores in Washington ADHD; Juma, which works
about the work. But it came and once he was cleared to to 367 spread over 28 states and with young adults in poverty;
with benefits and a 401(k), work, D’Aloia was left to scrub the United Kingdom. It has nine and Pioneer Human Services,
which was nice, if unusual. So dishes while water seeped in franchise partners, and in 2016, which offers career counseling
86 / E N T R E P R E N E U R . C O M / September 2018
→ MORE THAN PIZZA
MOD founders Scott
and Ally Svenson are
building impact hiring
into their franchise.
September 2018 / E N T R E P R E N E U R . C O M / 87
Food
88 / E N T R E P R E N E U R . C O M / September 2018
NEVER HAVE I EVER
THOUGHT WE COULD TRAVEL THE WORLD
virtual assistant?
Introducing...
TM
CP MAXX
Your Own Personal Assistant
on Amazon’s Alexa devices!
MODness, managers hit up Crying managers aren’t a typ- cause-driven companies. Recent attorney Harold Kestenbaum, is
some local connections to score ical scene at a corporate off-site, surveys by Cox Business and that it’s generally in the franchi-
him free temporary hous- but they’re welcome at MOD. MediaCom show that roughly sor’s interest to give its franchi-
ing. That employee, Chris “We’re really big on sharing sto- two-thirds of consumers are sees as much hiring discretion
Wells, now oversees five stores, ries,” says Sophia Arellano, a willing to spend more money as possible. In a 2014 “joint-
soon to be seven, and shares a MOD recruiter who confirms with brands that support social employment” ruling against
three-bedroom apartment with the profundity of this year’s missions. From a business per- McDonald’s, the National Labor
his girlfriend and two daugh- tearjerking GM meeting. “We spective, that makes it increas- Relations Board declared that
ters. He talks about MOD with even have an internal employee ingly easy to do the right thing. a corporate office could be held
the passion of a religious con- Facebook page where people cel- Companies that broadcast their liable for the people its fran-
vert: “Their pizza sauce pumps ebrate the good things they see.” values and then stand behind chisees brought in. “I counsel
through my veins.” To outsiders, all this devotion them are setting themselves up my clients not to make employ-
To continue to inspire to MOD can sound like a cult. for success. ment decisions for their fran-
do-good innovation, MOD cre- But the company chalks it up to Though social-impact hiring chisees,” says Kestenbaum. “You
ated an annual meeting—called a self-selecting group. The peo- isn’t a new idea—Dave’s Killer can make recommendations,
the Meeting of the MODs—for ple who buy into MOD, as either Bread out of Oregon has but I wouldn’t go beyond that.”
general managers to gather in franchisees or employees, are on been hiring ex-cons for nearly (The joint-employment ruling
Seattle. Recently, Mark Foley, board with the mission. “Culture 15 years, and New York’s was overturned by the Trump
the manager who began hiring is everything,” says Ally. “Because Greyston Bakery has been pro- administration, but it’s unclear
autistic employees in Houston, we invest in it, it defends itself. It’s moting no-questions “open hir- what will happen in the future.)
was invited to address his col- taken on a life of its own.” ing” for 35 years—it is almost Of course, MOD doesn’t
leagues onstage. As he did, he nonexistent within franchises. require its franchisees to hire
found himself overwhelmed. “I MOD’S GROWTH arrives at There are likely many reasons any certain type of employee. It
was an idiot up there, crying,” he a time when consumers are why, but a big one, according relies on its culture to apply a
says. “It was so emotional.” increasingly willing to support to New York–based franchise more subtle form of pressure—
which means that the initiative Arellano, the franchise’s be accessing the last bastion of in me,” he says. “Being able to
is always at risk of falling off the recruiter, knows firsthand how untapped, hardworking talent. do that for other people is really
agenda. Along the West Coast important that “You’re hired!” “It’s good business to look wher- important. The best part of the
and in parts of Texas, MOD is can be. At age 32, she was ever you can to find the best peo- job is helping people through
good at finding impact hires. arrested and convicted of a non- ple for your organization,” says the same situation I was in.”
But in regions where the com- violent crime, and for her first Ron Cool, the director of corpo- And there it is: the MODness
pany’s presence is still new, it six months at MOD, she had a rate and franchise operations at culture keeping itself alive.
has work to do. “We need to be tracking device on her ankle. Garbanzo Mediterranean Fresh, One kindness begets another.
really systematic about embed- What started as a transitional a Colorado-based franchise that, As the company grows, there’s
ding our approach so that it’s gig turned into a passion-driven like MOD, works to hire for- no guarantee that the do-good
locked in,” says Ally. career when she realized how merly incarcerated and devel- spirit will stay strong. But it’s
If MOD’s culture-driven many people like her were on opmentally disabled employees. sure worth a shot. “It’s not a
attempt to be the first major staff. “They’re not just employing “These people come in with a done deal,” says Ally. “It’s hard
company to make impact hires people,” she says of her bosses. genuine desire to better them- to make sure that our purpose
at the national level is a suc- “They’re giving them a way to selves. All they want is a chance.” will be protected and perpet-
cess, it could have implications feed their families, a way to not D’Aloia remembers that feel- uated in the places it’s needed
far beyond its 367 stores. “The go out and reoffend.” ing well. Now 39, he’s a dis- most. I feel like we are only
scope and scale of MOD could By that measure, when MOD trict manager who oversees six starting. We are at the begin-
bring more attention to the comes to town, it’s doing more MOD locations in Washington. ning of something.”
need to hire these people,” says than serving pizza. It’s help- In his seven years with the com-
Hilary Young, a vice president ing to turn crime-prone citi- pany, he has flown to the United Clint Carter is a digital nomad
with Pioneer Human Services, zens into productive members Kingdom to train managers and who covers travel, food, busi-
one of the organizations MOD of society. And in today’s tight spoken at Harvard. “I’ve had all ness, and health for Men’s
uses to find employees recently labor market—unemployment these opportunities I wouldn’t Journal, Men’s Health, The
released from prison. is below 4 percent—it might also have had if MOD didn’t believe Wall Street Journal, and others.
LOWCOST
FRANCHISE
AMAZING
REWARDS
RANKED #2 FRANCHISE Entrepreneur magazine has ranked us the #2 Top Low-Cost Franchise
UNDER $100K under $100K. Our franchise fee is only $1,000!
Who Has
the Strongest
Brands?
Franchising is all
about brand power.
Here are the 200
companies people
love the most.
by T R A C Y S TA P P H E R O L D
W
elcome to
Entrepreneur’s
second annual
ranking of the
top franchise
brands. While
our signature
ranking, the
Franchise 500®, takes a holistic
view of the elements that might
make a company attractive
to prospective franchisees—
growth, costs, support, and
S L
MDAI G EI TA
brand strength. We do that by a footnote in franchise history. staying true to the roots that Remember as you read that
S ./CGOEM
analyzing factors such as social The best brands are those that gained them fans in the first this ranking is not intended as a
media followers, system size, the have proven they can stand the place and constantly evolving recommendation of any partic-
G TE O
AO
number of years in business, and test of time. You will find a few and reinventing themselves to ular company. Always do your
PH
C KI M
the number of years franchising. relative newcomers here, but stay relevant in the present research into every aspect of an
OA
A IPOHN BBYY TI ES T R
Those last two are partic- the average age of the compa- day. From a fancy new head- opportunity before investing.
ularly telling. New franchises nies on this list is 47 years. quarters to fun on social media Read their legal documents,
come and go every year. Some That said, don’t expect any of to entirely new products and consult with an attorney and an
AT
build up hundreds and even them to look the same as they services, we’ve highlighted accountant, and talk to existing
RR
U TSOT G
thousands of units before did 47 years ago. The key to just a few of the ways some of and former franchisees to find
IPLHL O
disappearing from the scene, their longevity lies in their abil- these companies are keeping what’s right for you.
September 2018 / E N T R E P R E N E U R . C O M / 93
The List
1McDonald’s 9
Dairy Queen
Burgers, chicken, Ice cream, burgers, chicken
salads, beverages
STARTUP COST
STARTUP COST $1.1M–$1.9M
$1M–$2.2M
TOTAL UNITS
TOTAL UNITS (Franchised / Co.-Owned)
(Franchised / Co.-Owned) 6,905/2
34,279/3,007
2 10
GNC Franchising
KFC Vitamins and
Chicken nutrition products
STARTUP COST STARTUP COST
$1.5M–$2.6M $180.5K–$347.3K
TOTAL UNITS TOTAL UNITS
(Franchised / Co.-Owned) (Franchised / Co.-Owned)
19,463/1,363 3,084/3,506
3 11
Pizza Hut Papa John’s
Pizza, pasta, wings International
STARTUP COST Pizza
$302K–$2.2M STARTUP COST
TOTAL UNITS $130.1K–$844.4K
(Franchised / Co.-Owned)
TOTAL UNITS
14,645/352 (Franchised / Co.-Owned)
4,410/645
4
Dunkin’ Donuts 12
Coffee, doughnuts, H&R Block
baked goods Tax preparation,
STARTUP COST electronic filing
$228.6K–$1.7M STARTUP COST
TOTAL UNITS $31.6K–$149.4K
(Franchised / Co.-Owned)
TOTAL UNITS
12,538/0 (Franchised / Co.-Owned)
4,027/6,655
5
Subway 13
Subs, salads Kumon Math &
STARTUP COST Reading Centers
$147.1K–$320.7K Supplemental education
TOTAL UNITS STARTUP COST
(Franchised / Co.-Owned)
$69.6K–$148.97K
44,608/0
TOTAL UNITS
(Franchised / Co.-Owned)
25,827/32
6
Taco Bell
Mexican food 14
STARTUP COST Snap-on Tools
$525.1K–$2.6M Professional tools and
equipment
TOTAL UNITS
McDonald’s/ No.1
(Franchised / Co.-Owned) STARTUP COST
5,889/797 $169.5K–$350.2K
TOTAL UNITS
(Franchised / Co.-Owned) P H O T O G R A P H C O U R T E S Y O F M C D O N A L D ’ S C O R P O R AT I O N
7 4,696/162
MCDONALD’S NEW headquarters is symbolic of the brand’s continuing evolution into
7-Eleven
Convenience stores the “modern progressive burger company” envisioned by CEO Steve Easterbrook.
STARTUP COST 15 Headquartered in Oak Brook, Ill., since 1971, the Golden Arches returned to its
$37.6K–$1.1M RE/MAX
Real estate
TOTAL UNITS
(Franchised / Co.-Owned)
original home base of Chicago this June with the opening of a nine-story, block-wide
STARTUP COST
61,086/1,019 $37.5K–$225K building in the West Loop neighborhood. The first floor of the new office features an
TOTAL UNITS
(Franchised / Co.-Owned)
“Experience of the Future” restaurant, open to the public, with self-order kiosks,
8 7,560/0 mobile ordering and payment, table service, and a rotating menu of favorites from
Baskin-Robbins
Ice cream, frozen yogurt, around the world. One floor up is the Hamburger University training center, which
frozen beverages
will host more than 3,000 students annually. Other features include “work neighbor-
STARTUP COST
$93.6K–$401.8K hoods” with open floor plans, huddle rooms, communal tables, workstations, and
TOTAL UNITS
(Franchised / Co.-Owned) private phone rooms; a 700-person conference center; a work café with stadium
7,982/0
seating and a tech bar; a test kitchen that will compost all its waste; and, of course, a
fitness center on the ninth floor to work off those Big Macs.
94 / E N T R E P R E N E U R . C O M / September 2018
The List
16 19 22 25 28 35
Sonic Drive-In The UPS Store Holiday Inn and Jimmy John’s ServiceMaster Chem-Dry Carpet &
Restaurants Postal, business, printing, Holiday Inn Express Gourmet Clean/ Upholstery Cleaning
Burgers, hot dogs, chicken and communications Hotels Sandwiches ServiceMaster Carpet and upholstery
sandwiches, breakfast, services Sandwiches Restore cleaning, tile and stone
STARTUP COST
ice cream, beverages STARTUP COST care, granite renewal
$7.5M–$24.8M STARTUP COST Commercial/residential
STARTUP COST $177.96K–$402.6K $329.5K–$557.5K cleaning, disaster STARTUP COST
TOTAL UNITS restoration
$1.1M–$2.4M TOTAL UNITS (Franchised / Co.-Owned) $56.5K–$162.5K
(Franchised / Co.-Owned)
TOTAL UNITS
TOTAL UNITS 3,730/3 (Franchised / Co.-Owned) STARTUP COST TOTAL UNITS
(Franchised / Co.-Owned) 4,979/0 2,718/56 $93.2K–$299K (Franchised / Co.-Owned)
3,212/345 3,536/0
TOTAL UNITS
20 23 (Franchised / Co.-Owned)
17 Arby’s
Great Clips 26 5,023/10
36
Hair salons Coverall
Ace Hardware Sandwiches, fries, shakes Rent-A-Center
Hardware and
home-improvement stores
STARTUP COST
STARTUP COST
$136.9K–$258.3K
Commercial cleaning
STARTUP COST
29 Rent-to-own furniture,
electronics, computers,
$314.6K–$1.8M $16.5K–$51.4K
Jan-Pro Franchising
TOTAL UNITS appliances
STARTUP COST
TOTAL UNITS (Franchised / Co.-Owned)
International
$272.5K–$1.6M (Franchised / Co.-Owned)
TOTAL UNITS Commercial cleaning STARTUP COST
4,285/0 (Franchised / Co.-Owned)
TOTAL UNITS 2,360/1,077 $355.4K–$582.4K
8,575/0 STARTUP COST
(Franchised / Co.-Owned) TOTAL UNITS
$3.99K–$51.1K
4,932/101
21 24 TOTAL UNITS
(Franchised / Co.-Owned)
150/2,564
Jackson Hewitt
Circle K 27 (Franchised / Co.-Owned)
8,486/0
18 Tax Service
Convenience stores Planet Fitness
Fitness clubs 37
Jazzercise Tax preparation
STARTUP COST
Group fitness classes,
conventions, apparel, and STARTUP COST
$185.5K–$1.6M
TOTAL UNITS
STARTUP COST
$857.1K–$4.2M
30 Supercuts
Hair salons
accessories $39.7K–$105.4K (Franchised / Co.-Owned) Liberty Tax Service
TOTAL UNITS Tax preparation, STARTUP COST
STARTUP COST TOTAL UNITS 2,286/5,765 (Franchised / Co.-Owned)
(Franchised / Co.-Owned) electronic filing $144.3K–$296.9K
$3.7K–$32.8K 1,353/58
4,065/1,772 STARTUP COST TOTAL UNITS
TOTAL UNITS (Franchised / Co.-Owned)
$58.7K–$71.9K
(Franchised / Co.-Owned) 1,721/944
9,077/2 TOTAL UNITS
(Franchised / Co.-Owned)
3,479/289
38
Cruise Planners
31 Travel agencies
Denny’s STARTUP COST
Family restaurants $2.1K–$22.9K
STARTUP COST TOTAL UNITS
(Franchised / Co.-Owned)
$228K–$2.5M
2,564/1
TOTAL UNITS
(Franchised / Co.-Owned)
1,549/172
39
Mac Tools
32 Automotive tools and
equipment
Ben & Jerry’s
Ice cream, frozen yogurt, STARTUP COST
sorbet, smoothies $171.4K–$359.8K
STARTUP COST TOTAL UNITS
(Franchised / Co.-Owned)
$156.4K–$486K
1,146/20
TOTAL UNITS
(Franchised / Co.-Owned)
557/29
40
Hilton Hotels
33 and Resorts
Upscale hotels and resorts
Super 8
Hotels STARTUP COST
STARTUP COST $29.1M–$111.95M
$209.6K–$4.4M TOTAL UNITS
(Franchised / Co.-Owned)
TOTAL UNITS
(Franchised / Co.-Owned) 503/69
2,873/0
SCREEN GRAB COURTESY OF THE UPS STORE
41
34 Matco Tools
Mechanics’ tools and
Jack in the Box
equipment
The UPS Store/ No.19 Burgers
STARTUP COST
$1.5M–$2.9M
STARTUP COST
$91.4K–$269.6K
TOTAL UNITS
TOTAL UNITS (Franchised / Co.-Owned)
“WE HAVE FAX MACHINES and 3-D printers because we’re not sure what year it is.” (Franchised / Co.-Owned)
1,755/2
1,858/394
That’s just one example of the almost daily tweets made by The UPS Store, showing
the brand knows that one of the best ways to connect with customers on social media
is through humor. Curiosity helps, too: On Instagram, the company shows off some
of the interesting items it’s asked to ship, like a diving helmet, a cow skull, and a
collection of Power Rangers memorabilia, all tagged with #unexpectedpackandship.
96 / E N T R E P R E N E U R . C O M / September 2018
A FIT FOR EVERYONE.
This father and son team are part of a diverse group of franchise
owners that includes doctors, lawyers, C-level executives, multi-
brand entrepreneurs and even a former NFL quarterback. They’ve
all chosen Retro Fitness to grow and expand their investment
portfolios in the $24 billion health and wellness industry and are
united by a common goal: to deliver the very best personalized
wÌiÃÃiÝ«iÀiViwÌÌ}>ÞiLiÀ½ÃLÕ`}iÌ°
Flexible, manager-run business with a streamlined set of operations that provide franchise owners predictable
monthly income based on membership, plus additional revenue streams that maximize earning potential.
Average Gross Sales for the Top 10% of Retro Fitness clubs operating during the period 04/01/2017 to 03/31/2018. Top 10% includes 13 clubs. 4 of these clubs, or 30%, attained or exceeded the average. Average EBITDA for the Top 10% as shown in 2016 Federal Tax Returns
submitted. Top 10% includes 10 clubs. 3 of these clubs, or 30%, attained or exceeded this average. Average # of Members for Top 10% as of 03/31/2018. The Top 10% includes 13 clubs, 4 of which attained or surpassed the stated average. Read Item 19 of our April 30, 2018
(&&KPKVUGPVKTGV[HQTCFFKVKQPCNKPHQTOCVKQPKORQTVCPVFGƂPGFVGTOUCUUWORVKQPUCPFSWCNKƂGTUTGNCVGFVQVJGUGƂIWTGU#PGYHTCPEJKUGGoUTGUWNVUOC[FKHHGTHTQOVJGTGRTGUGPVGFRGTHQTOCPEG6JGTGKUPQCUUWTCPEGVJCV[QWYKNNFQCUYGNNCPF[QWOWUVCEEGRVVJCVTKUM6JKU
advertisement is not an offering. This information is not intended as an offer to sell or the solicitation of an offer to buy, a franchise. It is for information purposes only. Offerings are made by prospectus only. ©2018 Retro Fitness LLC. All rights reserved.
The List
42 50 57 59 61 63
Anytime Fitness The Maids Servpro Sport Clips Edible Days Inn
Fitness centers Residential cleaning Disaster restoration Men’s sports-themed Arrangements Hotels
and cleaning hair salons Sculpted fresh-fruit
STARTUP COST STARTUP COST STARTUP COST
$89.4K–$677.8K STARTUP COST STARTUP COST bouquets $194.4K–$7.8M
$76.1K–$164.4K
$158.1K–$211.95K $189.3K–$354.5K STARTUP COST
TOTAL UNITS TOTAL UNITS TOTAL UNITS
(Franchised / Co.-Owned) (Franchised / Co.-Owned) TOTAL UNITS TOTAL UNITS $195.5K–$327.7K (Franchised / Co.-Owned)
4,019/38 1,236/111 (Franchised / Co.-Owned) (Franchised / Co.-Owned)
TOTAL UNITS 1,777/0
1,749/0 1,638/54 (Franchised / Co.-Owned)
1,239/6
43 51 58 60 64
Vanguard Novus Glass Snap Fitness
Cleaning Systems Auto glass repair and Cold Stone
Creamery
Gold’s Gym 62 24-hour fitness centers
Commercial cleaning replacement Health and fitness centers Chester’s STARTUP COST
STARTUP COST Ice cream, sorbet STARTUP COST Chicken $148.8K–$462.8K
STARTUP COST
$10.9K–$39.4K $46.2K–$241.9K STARTUP COST $2.2M–$5M STARTUP COST
TOTAL UNITS
TOTAL UNITS $50.2K–$467.5K TOTAL UNITS $12K–$296.6K (Franchised / Co.-Owned)
TOTAL UNITS
(Franchised / Co.-Owned) (Franchised / Co.-Owned)
TOTAL UNITS
(Franchised / Co.-Owned)
TOTAL UNITS 1,376/34
3,237/0 1,967/32 (Franchised / Co.-Owned) 571/148 (Franchised / Co.-Owned)
1,238/10 1,156/0
44 52
Hardee’s Jiffy Lube
Burgers, chicken, biscuits International
STARTUP COST Oil changes, preventative
maintenance
$1.4M–$1.9M
STARTUP COST
TOTAL UNITS
(Franchised / Co.-Owned) $71.7K–$450K
2,111/115 TOTAL UNITS
(Franchised / Co.-Owned)
2,089/0
45
Hampton by Hilton
Midprice hotels 53
STARTUP COST
CleanNet USA
Commercial cleaning
$6.9M–$17.1M
STARTUP COST
TOTAL UNITS
(Franchised / Co.-Owned) $20.9K–$85.4K
2,277/0 TOTAL UNITS
(Franchised / Co.-Owned)
2,364/11
46
Merry Maids
Residential cleaning 54
STARTUP COST
Auntie Anne’s
$86.8K–$123.8K Hand-Rolled
Soft Pretzels
TOTAL UNITS
(Franchised / Co.-Owned) Soft pretzels
1,667/3 STARTUP COST
$199.5K–$385.1K
TOTAL UNITS
47 (Franchised / Co.-Owned)
1,814/14
Midas International
Auto repair and
maintenance
STARTUP COST 55
$179.1K–$435.1K Valvoline Instant
TOTAL UNITS
Oil Change
(Franchised / Co.-Owned) Oil changes and preventive
2,090/0 maintenance
STARTUP COST
$162.3K–$2.3M
48 TOTAL UNITS
(Franchised / Co.-Owned)
Hooters 734/384
Casual restaurants
STARTUP COST
PHOTOGRAPH COURTESY OF JIMMY JOHN’S
$956.5K–$4.3M
TOTAL UNITS
56
(Franchised / Co.-Owned) Jersey Mike’s Subs
229/197 Subs
STARTUP COST
$178.5K–$746.3K
Jimmy John’s Gourmet Sandwiches/ No.25
49 TOTAL UNITS
(Franchised / Co.-Owned)
Carl’s Jr. 1,264/79 JIMMY JOHN’S HAS long billed itself as “freaky fast” but in recent years has shifted
Restaurants
Burgers its marketing efforts to emphasize that it’s “freaky fresh” as well. Its new advertising
STARTUP COST
$1.4M–$1.95M campaign celebrates the “freaky” employees who bake fresh bread every four hours
TOTAL UNITS
(Franchised / Co.-Owned)
(and use a bread color gauge to make sure it’s perfect), precisely hand-slice
1,536/80 all-natural meats and veggies (lettuce must be 3/32 of an inch—no more, no less),
and even blend batches of the brand’s new Kickin’ Ranch Sauce daily in store.
98 / E N T R E P R E N E U R . C O M / September 2018
The thought behind the sailboat As 2018 gets underway, Lane
LunchboxWax: theory, she said, is that people can
come together to achieve a goal
continues to grow this modern-
day culture club by awarding
A MODERN-DAY (or reach a destination), but if the
focus isn’t on collaboration and
franchises to a diverse mix of
curious, driven professionals
CULTURE CLUB purpose, it’s not success at all. — people who want the
independence afforded by
You have to wonder, does business ownership and the
FOUNDER & CEO DEBI LANE
this progressive, good- support of a dedicated team
TALKS ABOUT THE VIBE hearted approach work? in an industry poised for
BEHIND THE BODY-WAXING growth (no pun intended).
BRAND, THE EXPLOSIVE During the first year of franchising,
six salons opened nationwide to She says, “Behind our expertly
GROWTH AND THE KINDS
welcome women and men who trained waxologists, thoughtfully
OF PEOPLE CHOSEN are mindful about people and designed salons and specially
TO JOIN THE CULTURE- places they choose for personal formulated products is a
DRIVEN FRANCHISE. services. Since then, the company knowledgeable, energetic team
has near-doubled in size each that guides each LunchboxWax
year and earned a ranking in franchisee every step of the way.”
Entrepreneur Magazine’s 2017
top 100 new franchises. Learn more about becoming
a LunchboxWax franchisee at
When LunchboxWax Ed Sheridan, who operates lunchboxfranchise.com.
CEO Debi Lane selects LunchboxWax salons in the
new franchisees for Northeast with his son Patrick,
the chic-and-cheeky says the attention to detail
body-waxing concept and commitment to culture
she launched in 2010 is central to the growth.
and franchised in 2013,
“Walk into any
there’s a question
LunchboxWax, and the
she asks herself each
competence, and kindness
time: Could I spend a
is palpable,” said Sheridan.
fulfilling and enjoyable
“The energy resonates
week on a sailboat
and tells this great story.
with this person?
It’s natural to want
to be a part of it.”
This is not an offer to sell or solicitation of an offer to buy. Offers are only made in states where we have complied with applicable law and an offer to sell or a solicitation of any offer to buy a fran-
chise shall be made solely by a Franchise Disclosure Document. All financial information is as shown in Section 19 of the FDD to be disclosed to potential franchisees during the awarding process.
The List
65 68 71 74 77 80
Cinnabon Lawn Doctor ampm Keller Williams Kampgrounds CiCis
Cinnamon rolls, baked Lawn, tree, and shrub care; Convenience stores and Real estate of America All-you-can-eat pizza
goods, coffee mosquito and tick control gas stations Campgrounds and RV parks buffets
STARTUP COST
STARTUP COST STARTUP COST STARTUP COST $183.9K–$336.99K STARTUP COST STARTUP COST
$182.8K–$327.3K $101.9K–$115.9K $430.7K–$7.9M $210.95K–$4.5M $222.5K–$1M
TOTAL UNITS
TOTAL UNITS TOTAL UNITS TOTAL UNITS (Franchised / Co.-Owned) TOTAL UNITS
TOTAL UNITS
(Franchised / Co.-Owned) (Franchised / Co.-Owned) (Franchised / Co.-Owned) 885/0 (Franchised / Co.-Owned) (Franchised / Co.-Owned)
1,464/2 537/0 956/36 465/30 380/50
66 69 72 75 81
Papa Murphy’s Motel 6 Merle Norman
Eye Level
Learning Centers
78 Culver’s
Anago Cleaning
Take-and-bake pizza Economy hotels Cosmetics Supplemental education Systems Frozen custard,
Cosmetics and specialty burgers
STARTUP COST STARTUP COST STARTUP COST Commercial cleaning
$274.6K–$499.2K $2.6M–$3.8M skin-care products STARTUP COST
$58.1K–$140.8K STARTUP COST
STARTUP COST $1.8M–$4.3M
TOTAL UNITS TOTAL UNITS TOTAL UNITS $10.4K–$68.5K
(Franchised / Co.-Owned) (Franchised / Co.-Owned) $34.8K–$186.5K (Franchised / Co.-Owned) TOTAL UNITS
TOTAL UNITS
1,397/148 824/454 TOTAL UNITS 616/797 (Franchised / Co.-Owned)
(Franchised / Co.-Owned)
(Franchised / Co.-Owned) 657/7
1,503/0
1,182/2
67 70 76 82
Red Roof Inn
Economy hotels
Stanley Steemer
Carpet Cleaner 73 Budget Blinds 79 Smoothie King
Window coverings, window Sylvan Learning
STARTUP COST Carpet and upholstery Massage Envy film, rugs, accessories Individualized supplemental Smoothies, healthful
cleaning Massage therapy, stretch snacks, health products
$3.5M–$5M STARTUP COST education
therapy, skin care, facials STARTUP COST
STARTUP COST $110.1K–$230.9K STARTUP COST
TOTAL UNITS
(Franchised / Co.-Owned) $108.9K–$255.6K STARTUP COST $225.7K–$778.2K
TOTAL UNITS $70.98K–$159.9K
386/126 $434.8K–$1M (Franchised / Co.-Owned) TOTAL UNITS
TOTAL UNITS TOTAL UNITS (Franchised / Co.-Owned)
(Franchised / Co.-Owned) TOTAL UNITS 1,134/0 (Franchised / Co.-Owned)
206/63 (Franchised / Co.-Owned) 876/26
601/14
1,189/0
83 86 89 92 95 98
Kona Ice Del Taco Doubletree by Hilton Wingstop Firehouse Subs Mathnasium
Shaved-ice trucks Mexican/American food Upscale hotels and resorts Restaurants Subs Learning Centers
STARTUP COST STARTUP COST STARTUP COST Chicken wings STARTUP COST Math tutoring
$120.2K–$143K $859.7K–$2.1M $21.99M–$69.3M STARTUP COST $94.8K–$1.1M STARTUP COST
TOTAL UNITS TOTAL UNITS TOTAL UNITS $346.8K–$733.2K TOTAL UNITS $112.8K–$148.6K
(Franchised / Co.-Owned) (Franchised / Co.-Owned) (Franchised / Co.-Owned) (Franchised / Co.-Owned)
TOTAL UNITS TOTAL UNITS
1,052/18 252/312 397/0 (Franchised / Co.-Owned) 1,049/37 (Franchised / Co.-Owned)
1,035/21 892/14
84 87 90 96
Golden Corral
Restaurants
Dippin’ Dots
Franchising
Home Instead
Senior Care
93 Meineke Car 99
FastSigns Care Centers Valpak Direct
Family steakhouses, Specialty ice cream, frozen Nonmedical senior care International Auto repair and Marketing Systems
buffets, and bakeries yogurt, ices, sorbet Signs, graphics maintenance Direct-mail and digital
STARTUP COST
STARTUP COST STARTUP COST $108.9K–$124.9K STARTUP COST advertising
STARTUP COST
$2.1M–$6.2M $112.2K–$366.95K $193.5KK–$289.6K $123.1K–$572.4K STARTUP COST
TOTAL UNITS
TOTAL UNITS TOTAL UNITS (Franchised / Co.-Owned) TOTAL UNITS $80.6K–$200.8K
TOTAL UNITS
(Franchised / Co.-Owned) (Franchised / Co.-Owned) 1,129/3 (Franchised / Co.-Owned) (Franchised / Co.-Owned)
TOTAL UNITS
402/69 212/1 674/0 915/11 (Franchised / Co.-Owned)
129/14
85 88 91 97
Pearle Vision Ramada Worldwide
Watermill Express
Franchising
94 Dale Carnegie 100
Minuteman Press
Eye care and eyewear Hotels Water and ice vending International Training Fantastic Sams
STARTUP COST STARTUP COST machines Printing, graphics, and Workplace training and Cut & Color
$400.3K–$605.2K $218.9K–$13.8M marketing services development Hair salons
STARTUP COST
$460K–$586.8K STARTUP COST STARTUP COST STARTUP COST
TOTAL UNITS TOTAL UNITS
(Franchised / Co.-Owned) (Franchised / Co.-Owned) $64.2K–$164.5K $51.2K–$186.5K $145.4K–$317K
TOTAL UNITS
421/102 873/0 (Franchised / Co.-Owned) TOTAL UNITS
TOTAL UNITS TOTAL UNITS
305/996 (Franchised / Co.-Owned) (Franchised / Co.-Owned) (Franchised / Co.-Owned)
965/0 271/2 1,045/3
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The List
101 108
Stratus Building Marco’s Pizza
Solutions Pizza, subs, wings,
Environmentally friendly cheese bread
commercial cleaning STARTUP COST
STARTUP COST $222.8K–$663.8K
$3.5K–$48.4K TOTAL UNITS
(Franchised / Co.-Owned)
TOTAL UNITS
(Franchised / Co.-Owned) 894/0
1,522/0
102 109
Round Table
Complete Franchise
Weddings + Events Pizza
Photography, DJ, video, STARTUP COST
and photo-booth services
$423.5K–$831.3K
STARTUP COST
TOTAL UNITS
$26.4K–$48.7K (Franchised / Co.-Owned)
$289.9K–$421.2K
107
Interim HealthCare
TOTAL UNITS
(Franchised / Co.-Owned)
Red Roof Inn/ No.67
549/5
Medical home care,
medical staffing
RED ROOF RECENTLY launched its first “soft brand”—a collection of hotels that will
STARTUP COST
$125.5K–$198.5K 115 be part of the chain’s network but operate under their own unique names and
TOTAL UNITS
Ziebart
(Franchised / Co.-Owned) Auto appearance and styles, inspired by their local cultures. Hotels in the Red Collection will still offer
561/0 protection services
STARTUP COST
popular Red Roof amenities—free wi-fi, a pet-friendly policy, and the RediCard
$227K–$450K loyalty program—but will be located in city centers, close to popular attractions.
TOTAL UNITS
(Franchised / Co.-Owned) The first two in the collection, the St. Clair Hotel in downtown Chicago and the
379/12
State House Inn in Springfield, Ill., are set to open soon.
HOSTED BY
The List
116 123
Primrose School Duraclean
Franchising Carpet and upholstery
Educational childcare cleaning, disaster
restoration, mold
STARTUP COST remediation
$716.7K–$5.8M
STARTUP COST
TOTAL UNITS $38.7K–$117.9K
(Franchised / Co.-Owned)
353/0 TOTAL UNITS
(Franchised / Co.-Owned)
274/9
117
Travelodge
Hotels
124
Proforma
STARTUP COST Printing and promotional
$198.9K–$7.8M products
TOTAL UNITS STARTUP COST
(Franchised / Co.-Owned)
$4.7K–$39.7K
415/0
TOTAL UNITS
(Franchised / Co.-Owned)
654/0
118
Bojangles’ Famous
Chicken ’n Biscuits
Chicken, biscuits, iced tea
125
Gloria Jean’s
STARTUP COST Coffees
$1.4M–$2.2M Specialty coffee
TOTAL UNITS STARTUP COST
(Franchised / Co.-Owned)
$181.2K–$488.8K
436/326
TOTAL UNITS
(Franchised / Co.-Owned)
856/0
119
ActionCoach
Business coaching 126
STARTUP COST TacoTime
$47.96K–$466.8K Mexican food
TOTAL UNITS STARTUP COST
(Franchised / Co.-Owned)
$144.7K–$814.1K
758/3
TOTAL UNITS
(Franchised / Co.-Owned)
274/0
120
Orion Food Systems
Fast-food systems for
nontraditional markets
127
Pet Supplies Plus
STARTUP COST Retail pet supplies and
$59.5K–$140K services
TOTAL UNITS STARTUP COST
(Franchised / Co.-Owned)
$463.7K–$995.4K
996/0
TOTAL UNITS
(Franchised / Co.-Owned)
222/213
121
Goddard Systems
Preschool/educational
childcare
128
Once Upon A Child
STARTUP COST New and used children’s
$619.9K–$760.6K clothing, equipment,
TOTAL UNITS furniture, toys
(Franchised / Co.-Owned)
STARTUP COST
482/0 $254.1K–$390.5K
TOTAL UNITS
(Franchised / Co.-Owned)
122 357/0
Hungry Howie’s
Pizza & Subs
Pizza, subs, calzones, 129 Del Taco/ No.86
P H O T O G R A P H C O U R T E S Y O F D E L TA C O
LIKE MANY BRANDS, Valpak—which turns 50 this year—has had to adapt to appeal
to today’s consumers. The company now offers digital coupons, as well as a mobile
app with an augmented reality feature that allows customers to hold their phones
to the horizon to see nearby businesses offering deals. But Valpak still mails out its
signature Blue Envelope as well. And now it’s launching data-driven direct mail
products like the Luxe mailer, which includes high-end brands targeting the
millennial audience.
138 145
Rooter-Man Embassy Suites
Plumbing, drain, and by Hilton
sewer cleaning Upscale all-suite hotels
STARTUP COST STARTUP COST
$46.8K–$137.6K $17.4M–$75M
TOTAL UNITS TOTAL UNITS
(Franchised / Co.-Owned) (Franchised / Co.-Owned)
613/22 235/0
139 146
Checkers and Two Men and a
Rally’s Restaurants Truck International
Burgers, fries Moving services
STARTUP COST STARTUP COST
$96.4K–$1.5M $95K–$666K
TOTAL UNITS TOTAL UNITS
(Franchised / Co.-Owned) (Franchised / Co.-Owned)
567/284 300/2
140 147
Steamatic Paul Davis
Insurance/disaster Restoration
restoration, cleaning, Insurance restoration
mold remediation
STARTUP COST
STARTUP COST
$196.4K–$422.6K
$74.4K–$173.5K
TOTAL UNITS
TOTAL UNITS (Franchised / Co.-Owned)
(Franchised / Co.-Owned)
250/0
170/0
141 148
Realty Executives Sandler Training
Sales and sales-manage-
Intl. Svcs. ment training
Real estate
STARTUP COST
STARTUP COST $91.5K–$108.5K
$23.5K–$171K
TOTAL UNITS
TOTAL UNITS (Franchised / Co.-Owned)
(Franchised / Co.-Owned)
263/0
481/0
150
143 Martinizing
Dry-cleaning and laundry
Schlotzsky’s services
Sandwiches, pizza, salads
STARTUP COST
$503.8K–$787.98K
TOTAL UNITS
STARTUP COST
$131.4K–$577.3K
TOTAL UNITS
(Franchised / Co.-Owned)
A franchise opportunity
(Franchised / Co.-Owned) 379/0 for home and life.
339/25
144 151 Pillar To Post offers the opportunity for you to create a business, a career,
Great American
Potbelly Cookies and the the life you want for yourself and your family. Joining a business
Sandwich Shop Cookies
Toasted sandwiches STARTUP COST
where helping yourself and other people realize their dreams is one of the
STARTUP COST $160.1K–$461.1K best decisions you’ll ever make.
$564.1K–$782.7K TOTAL UNITS
TOTAL UNITS (Franchised / Co.-Owned)
(Franchised / Co.-Owned) 366/0
55/424
franchise@pillartopost.com
877-963-3129
pillartopostfranchise.com
The List
152 159
Crowne Plaza First Choice
Hotels & Resorts Haircutters
Hotels Family hair salons
STARTUP COST STARTUP COST
$28.4M–$61.3M $168.9K–$282.6K
TOTAL UNITS TOTAL UNITS
(Franchised / Co.-Owned) (Franchised / Co.-Owned)
410/0 197/210
153 160
Mr. Rooter Signarama
Plumbing, drain, and Signs
sewer cleaning STARTUP COST
STARTUP COST $110K–$295.5K
$74.3K–$180.2K TOTAL UNITS
TOTAL UNITS (Franchised / Co.-Owned)
(Franchised / Co.-Owned) 702/0
276/0
154 161
Togo’s
The Melting Pot Specialty sandwiches,
Restaurants salads, soups, wraps
Fondue restaurants STARTUP COST
STARTUP COST $274K–$508.7K
$969.2K–$1.4M TOTAL UNITS
(Franchised / Co.-Owned)
TOTAL UNITS
(Franchised / Co.-Owned) 225/12
119/3
162
155 Camille Albane
AlphaGraphics Franchising
Digital publishing, Upscale hair and
internet services, beauty salons
printing, marketing, and STARTUP COST
communications
$245.9K–$424.8K
STARTUP COST
TOTAL UNITS
$285.8K–$429.4K
GENERATE ACTION.
(Franchised / Co.-Owned)
TOTAL UNITS 270/0
(Franchised / Co.-Owned)
281/0
163
156 Fatburger
North America
GO BEYOND WORDS.
Glass Doctor Burgers
Auto/residential/
commercial glass STARTUP COST
installation, repair, and $525.5K–$988K
replacement TOTAL UNITS
(Franchised / Co.-Owned)
STARTUP COST
$128.8K–$265.5K 159/0
TOTAL UNITS
(Franchised / Co.-Owned)
180/0 164
AmeriSpec Home
Inspection Services
157 Home inspections
Maid Brigade STARTUP COST
Residential cleaning $46.4K–$59.7K
STARTUP COST TOTAL UNITS
$85K–$124K (Franchised / Co.-Owned)
252/0
TOTAL UNITS
(Franchised / Co.-Owned)
455/0
165
Fox’s Pizza Den
158 Pizza, sandwiches,
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The List
168 171
Comet Cleaners 174
(Franchised / Co.-Owned)
239/0
180 183
WSI Dry-cleaning and Spring-Green Johnny Rockets United Country
Digital marketing agencies laundry services Lawn Care
STARTUP COST STARTUP COST Lawn and tree care 177 Burger restaurants
STARTUP COST
Real Estate
Real estate
$64.5K–$94.6K $570K–$979K STARTUP COST Champs Chicken $605.5K–$1.1M STARTUP COST
$109.1K Fried chicken, fried fish,
TOTAL UNITS TOTAL UNITS sides TOTAL UNITS $16.7K–$45.4K
(Franchised / Co.-Owned) (Franchised / Co.-Owned) (Franchised / Co.-Owned)
TOTAL UNITS TOTAL UNITS
830/2 160/0 (Franchised / Co.-Owned) STARTUP COST 379/23 (Franchised / Co.-Owned)
109/26 $9K–$349K 417/0
TOTAL UNITS
(Franchised / Co.-Owned)
397/0
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OPPORTUNITY
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Then make your first call.
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→ THNKS FR TH MMRS
John Janick (second
from left) with Fall Out
Boy's Pete Wentz
(fourth from left) and
the Fueled by Ramen
family in 2007.
Fueled by Family
by John Janick, CEO, Interscope Geffen A&M
W
hen I was a teenager, in the ’90s, I was really into a call and signed them immediately over the telephone, just based
underground music. I’d buy wholesale orders of CDs on their music and vibes.
I loved and then sell them to friends for $10 apiece. Fall Out Boy obviously went on to have multiple platinum
Eventually I started putting together compilations. albums—they were our first really big success. This photo of me
It wasn’t about making a profit as much as it was and [Fall Out Boy’s] Pete Wentz, and some of the guys from The
about turning people on to new music that I loved. Academy Is… and Cobra Starship, was taken backstage after a show
I was friends with a local band, Less Than in 2007. Fall Out Boy and Panic! At The Disco, another band on our
Jake, in Florida, and the summer before my roster, had gone platinum by then. It’s crazy to think about where I
freshman year at the University of Florida, the drummer, Vinnie am now—running Interscope, living in L.A. with my wife and two
Fiorello, and I decided to start a record label. We launched Fueled kids—compared to where I was then, having spent years sleeping on
by Ramen out of my dorm room in 1996. There was no guidebook— an air mattress in a dorm room.
and not many people there in Gainesville to learn from. This picture sits in my office and reminds me of that hustle, but
We signed artists from all over the country, young acts that bigger mostly that Fueled by Ramen was a family. We worked together,
labels weren’t paying attention to. We wanted so badly to show these ate together, played basketball at night together. We did whatever
bands what we could do for them. I purposely took five years to fin- we could to break an artist. We all knew we were working toward
PHOTOGRAPH COURTESY OF JOHN JANICK
ish my undergraduate degrees; college life gave me a place to sleep something bigger, and we created a family atmosphere that could
and eat while I built the business. be felt by the people at the label and the artists and the fans. Now
A few years in, I kept seeing flyers for this band from Chicago that’s what I also love about Interscope—we’re a family, and a real
called Fall Out Boy. I remember thinking, That name is so horrible. entrepreneurial culture that both artists and employees want to be a
But when I finally checked them out, they were so good. I gave them part of. If you can achieve that, you’re checking all the boxes.
© 2018 United States Postal Service. All Rights Reserved. The Eagle Logo is among the many trademarks of the U.S. Postal Service®. Please recycle packaging materials whenever possible.
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