Praise for SCALE
David and Jeff, as highly successful business owners of multiple businesses, not only reveal novel ideas that generate huge multiples but also give you tools of how to think so you can invent and design actionable processes for your business. By focusing on best practices from these top business leaders, you too can generate maximum results for your business and your life.
S TEPHANIE H ARKNESS , entrepreneur and former chairman of the National Association of Manufacturers
Scale holds the answers to achieving your business goals. If you are tired of fearing your business will fall apart the minute you step away from the wheel, Hoffman and Finkel know how to take it to the next level.
S COTT D UFFY , author, Launch!
Ive been building businesses for over thirty years and this is the book I wish Id read years ago. Jeff and David have laid out a concrete framework to scale a company, along with the practical details to create and sustain rapid growth. Every business owner needs to read this book.
P ATTY D E D OMINIC , entrepreneur and past chairman of the Los Angeles Area Chamber of Commerce
Rapid growth without a good plan can kill a business faster than no growth at all. This book will show you how to grow smart!
J OHN J ANTSCH , author, Duct Tape Marketing and Duct Tape Selling
Jeff and David are big-game hunters in a modern business sense. Instead of guiding clients in the art of bagging animals, they stalk and slay fears and indecision. Scale is a competitive weapon! This book gives you exactly what you need to succeed in the big game.
P HILIP and G AYLE T AU BER , founders, Kashi Company
Wow! Scale gives you a step-by-step process to grow your business the right way. Ive mentored students from some of the best business schools in the nation, including Harvard, USC, and UCLA, and I would give this book to everyone. In fact, I would tell every business owner that they need to read this book. Understanding Scale will save you from reviewing twenty-five other business books.
S ANDY G OOCH , cofounder, Mrs. Goochs Natural Food Market (later acquired by Whole Foods)
With so much global attention on founders and start-ups, this is a refreshing read on innovative approaches to scaling companies and reducing their owner dependency. Scale is a must-read for anyone interested in founders and scaling firms.
J ONATHAN O RTMANS , president, Global Entrepreneurship Week, and senior fellow, Kauffman Foundation
If youre tired of struggling and spending every waking moment consumed by your business, then this is the book for you. Learn how to build a successful and sustainable business that has value without your being involved every minute. Consider the authors your personal mentors and transform the way you think about your business.
S USAN S OLOVIC , New York Times best-selling author, award-winning entrepreneur, and media personality
Scale is a masterwork that encapsulates enough practical wisdom to fill several books. The authors had the experience and talent to craft an exquisite cross-section of the why and how of sales, strategy, and operations in a fresh format for founder-builders. Theyve distilled the essence of complex management situations into practical summaries, with plenty of anecdotes to bring them to life. This book will ignite years of successful growth for any reader who applies what they share.
R OB K AUTZ , private investor and strategist, former CEO of Wolfgang Puck Worldwide
Most owners think that in order to grow and scale a business, they need to work harder and sacrifice their personal lives. Heres a simple road map that will put you on a growth trajectory by working lessa paradox that youll come to embrace by following this insightful books path to business success and personal freedom.
B ILLIE D RAGOO , president, National Association of Women Business Owners
PORTFOLIO / PENGUIN
Published by the Penguin Group
Penguin Group (USA) LLC
375 Hudson Street
New York, New York 10014
USA | Canada | UK | Ireland | Australia | New Zealand | India | South Africa | China
penguin.com
A Penguin Random House Company
First published by Portfolio / Penguin, a member of Penguin Group (USA) LLC, 2014
Copyright 2014 by Jeffrey Hoffman and David Finkel
Penguin supports copyright. Copyright fuels creativity, encourages diverse voices, promotes free speech, and creates a vibrant culture. Thank you for buying an authorized edition of this book and for complying with copyright laws by not reproducing, scanning, or distributing any part of it in any form without permission. You are supporting writers and allowing Penguin to continue to publish books for every reader.
The following trademarks are the exclusive property of Maui Millionaires, LLC and are used with permission: Self-Employment TrapTM and Sweet Spot Analysis. The following trademarks are the exclusive property of Maui Mastermind (NV), LLC and are used with permission: Maui Mastermind and Level Three Road MapTM.
Charts and graphs courtesy of Maui Mastermind
Hoffman, Jeff.
Scale : seven proven principles to grow your business and get your life back / Jeff Hoffman and David Finkel.
pages cm
Includes index.
eBook ISBN 978-0-698-15558-9
1. Small businessGrowth. 2. CorporationsGrowth. 3. Strategic planning. 4. Business planning. 5. Entrepreneurship. I. Finkel, David. II. Title.
HD62.7.H6274 2014 658.4'06dc23 2014020638
Version_1
JEFF:
To my amazing family, who have endured and supported me throughout the high-speed roller-coaster journey I dragged them on by choosing to be an entrepreneur
DAVID:
To my wife, Heather, and my sons Adam, Matthew, and Joshuathank you for making my life so much richer
CONTENTS
INTRODUCTION
I n 1992, a 22-year-old undergrad dropped out of college to launch his own business. He wanted to be his own boss and decided to build a company selling health products. His sisters told him he was a *$%*&^@ idiot, and his befuddled parents asked him softly if he wouldnt rather finish his degree first. But he was committed to make this, his first real attempt at formally building a business, a massive success. He bought the wholesale rights to a line of health products and invested his life savings ($3,200) in stocking inventory and setting up a small office, then spent long hours marketing the line, personally posting thousands of flyers and making hundreds of sales calls.
Eight months later, the business had failed; his family graciously never said I told you so. But the story doesnt end there. The good ones never do.
After taking some time to lick his wounds and salve his bruised ego, our now 25-year-old recent college grad made another go in a totally different business. His earlier failure had taught him some crucial lessons (including a sorely needed dose of humility). Cataloging his talents and interests, he decided on a new industryinfo-marketing. He made a list of the top ten business leaders in this industry and approached each one, asking for the opportunity to interview them about how they had built such successful companies, and asking for any advice they could give to someone just starting out. Initially, these big players ignored him, but he was persistent, hounding them until he finally got eight of the ten to meet with him. In their interviews, these leaders spoke candidly about the lessons they had gleaned after decades in the business world, climbing the same peaks our young businessman wanted to scale. He took their advice to heart, following up on skills and topics they said he would have to understand to be successful. He read dozens of business books and made a study of how to successfully build a business.
Next page