Ryan Blair - Nothing to Lose, Everything to Gain

Table of Contents

To my mother, Erla Hunt,
you gave me life, love,
and strength. I will always work hard to make you proud.

AUTHORS NOTE

These stories are based on events from the authors experiences.
Some names have been changed for privacy.
Note to parents: vulgarity is used in the book. The intention isnt to
endorse cussing, but to display my internal dialogue as a reflection of
the environment or circumstances I was in at the time.
I value your feedback, and Im always looking
for good ideas. If you have any please
e-mail me at ryan@nothingtolose.com.

Los Angeles is a city thats famous for a sign. The ultimate symbol of my neighborhood is the white lettering you can see nestled in the hills between the buildings as you drive through Hollywood. Like the city where I live, the defining symbol of my life is also made up of letters, the letters L and A overlapped like the Dodgers logo, but where the A crosses over the L there is an AK-47.

I live in a penthouse apartment in an exclusive building in Hollywood where each night when the local clubs let out, a steady flow of celebrities spills over into the complex for after-hours parties. Anyone from billionaire Paul Allen to Jessica Biel has stopped by my spot, and accordingly, my crib is decorated to reflect my lifestyle. I have a pool table instead of a couch. And I have a collection of rare art and literary works Ive acquired over the years. One of the unique pieces is a painting with the LA/AK-47 design, which I commissioned fashion designer Bryden Lando to paint for me, based on one of his most popular T-shirts.

It symbolizes the violence I grew up with, and it reminds me of the times when I actually used to carry around an AK-47. It was my most valuable asset back when I was a troubled young gang memberit protected me in the LA riots and in gang shootings. Now the painting on my wall could buy a truckful of those guns.

Next to this painting is a locked glass bookcase full of books, first-edition books by Napoleon Hill, Dale Carnegie, and several others from friends such as Jerry Rice, Bode Miller, Coach Dale Brown, the late John Wooden, and one special title that was given to me by Bob Goergen, a world-renowned entrepreneur and investor, when he bought my company. Inside the cover of the book reads an inscription: Welcome to the Blyth family. We look forward to a profitable future together, Bob Goergen 8/08.

From the outside it looks as if I have this great, easy lifestyle. The truth is Ive never made a million dollars easily, and Ive made many millions of dollars.

It was August 2008, the same date as the inscription on the book, and I was on the ultimate high. Id just sold ViSalus in a deal that, coupled with a multiyear earn out, was pegged at $120 million (or more if we performed greater than expectations) to a public company called Blyth, owned by the Goergen family. I celebrated my victory on the Donny Deutsch show, Fox News, MSNBC, and all over the wires. E-mails of congratulations from Wall Street to Main Street flooded my in-box. I had done something no one had ever done in my industry: we negotiated ten times our forward projected earnings in 2008 and eight times our earnings over the next three years. Never has a company as small as ours in the direct selling industry been bought for as large a valuation as wed gotten. In essence, wed received something better than what wed have gotten if wed taken the company public. As I was walking on set to my Donny Deutsch appearance, I received a text from my girlfriend at the time, who was also on set; she was a model on NBCs Deal or No Deal. The text simply said, Youre going to be a father.

Almost immediately after I came to grips with the fact that I would be a father (fatherhood is a serious thing to me, given that my biological father was a deadbeat), the U.S. economy went into a death spiral. A few short months, by December 2008, the presidents economic adviser announced that the American economy had fallen into a depression. The announcement was paired with a report from the U.S. Department of Labor that more than 533,000 Americans had lost their jobs in November 2008, and 1.9 million Americans had become unemployed during that calendar year. And I had a first-born child on the way.

As a student of entrepreneurship I knew this was a rare moment in history. Having studied capitalism and the impact of the Great Depression I knew that sixteen of todays Dow 30 companies were founded during a recession or depression. Corporate icons like General Electric, Johnson & Johnson, Procter & Gamble, and Disney were formed when times were tough. I started writing this book to rally the pioneering spirit in Americans and I called it Nothing to Lose after the mind-set I used to climb out of poverty and become a multimillionaire CEO.

Fast-forward to December 2009. At this point, ViSalus, the company I had just sold in a deal valued at $120 million, was worthless. Sales had dropped from $2.5 million a month to $600,000 over the year. That profitable future Bob Goergen had inscribed in my book was anything but. Blyth had lost faith in my business and written it off. The recession had exposed flaws in our business modelflaws that our overconsuming target customers didnt pay much attention to when theyd had access to credit cards and home equity lines, the value of their homes was appreciating, and their incomes were on the rise.

In good times, weak businesses prosper. And it turned out that I had built a business based on good times. Blyth had paid me a premium for a company that was now worthless to them. All the executives who had fought to pay me the ten times valuation that I had so vehemently negotiated in 2008 had egg on their faces. The people who were against the deal were proved right. And I was the poster boy for the guy who took a public company for a lot of money.

That December I was summoned to Blyth headquarters for a special meeting in the same boardroom Id sat in to negotiate the terms of the sale of ViSalus the year before. I was asked to come alone. But they did send out a suit from Greenwich, Connecticut, headquarters to Los Angeles (who claimed to know more about my business because of his MBA), to babysit me while I prepared a presentation they wanted me to give at the meeting, so it would be up to their corporate standards.

As it stood, I had put nearly a million dollars of my own money into the business to try to revive it. Id voluntarily agreed to a $1 a year salary the minute the economy went south. I had a newborn son to think about, and it worried me that I might have just bet his future as well as my own on a business that was about to die. The company needed at least a million more to get through the next few months, but that probably wasnt enoughand I knew it. I might need $2 million, maybe $3 million, and at this point we had put $26 million into it. What I needed more than money was a beacon of hope. I needed my investors to look at me and say, We know youre going to make it, Ryan. We believe in you as an entrepreneur; we are on board with your vision.

It was a winter day in Greenwich. I put on my Sunday best and walked into that meeting. It was clear within seconds that nobody wanted to hear my presentation; they wanted to crucify me. They had investors remorse. One by one they tore into me, until one of the managers got so angry at me that he stood upbiting his tongue, red in the faceand walked out of the room.