Lessons from Entrepreneurs Who Beat the Odds

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After 20 years managing other entrepreneurs' businesses, Miriam Rieck opened BYD Ranch & Kennel in Bryan, Tex.

Part of Tom Niemeier's strategy for his St. Louis-based architectural design firm Space included circumscribing its growth.

Matt Carlin says the success of his staffing provider Resource Options in Needham, Mass. is due in large part to the quality of the people he hires.

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When construction began to slow down in 2007 and business tapered off with the slumping economy, Niemeier tried to recalibrate and adjust to the new realities. In the past two years he says he laid off three people. He also purchased a construction company that he says "helped us lengthen our revenue on any given project. We design it and we build and manage the construction. It's a nice source of revenue." This year Niemeier expects revenue to reach about $1.7 million, down slightly from $1.8 million last year.

"There's never been a moment yet that I felt I was not going to make it," he says. "Even if we have had to cut people."

Year 10
Resource Options
Needham, Mass.
Founded 1999

Before starting staffing provider Resource Options in 1999, Matt Carlin spent seven years as a hockey coach at Cornell and Dartmouth. After getting married, his wife, a former news anchor, and he decided that if they wanted to raise a family, they needed to change their lifestyles. For Carlin that meant trading in his travel schedule to start his own company.

Carlin says he chose the staffing business because it required a similar skill set to being a hockey coach: primarily recruiting talented people. "I would be utilizing the same methodologies and processes," he says. He borrowed $50,000 from his father and made his first goal paying back the loan as soon as his company became profitable. He wanted to run a business that could sustain itself with two to three people.

"Each time we had success we wanted to have some more," he says. "Initially I wanted to get to $5 million and I did that by year three. That same year Carlin says the business turned a profit and he was able to repay his father. "Then we went to $10 million, then $25 million."

During the first year, Carlin says his biggest client that represented 10% to 15% of his receivables filed for Chapter 11 bankruptcy protection. "That was an enormous loss and a big hurdle to get over," he says. "But what I learned from that is that I really had to do a better job of screening and qualifying our prospective clients. Not everybody is a good client and when they don't pay their bills in a timely manner I realized we had to fire them." Carlin says the situation also taught him "not to put all of our eggs in one basket." Following that first-year debacle that nearly undermined the company, Carlin says he redoubled his efforts in order to bring in new business and made sure to diversify the base so that any one client wouldn't expose the company too much.

After surviving the first year, Carlin says by the time he reached year five his biggest challenge was to keep up with growth. "We were growing so quickly, we opened branches and satellite offices. We were doubling and tripling revenue every year. We were growing faster than our projections. I did a lot of soul-searching and made some key hires in 2005, and I began to delegate more responsibility." Carlin also invested in new technology and software to streamline processes and shore up his back office.

During the past two years the company's lightning growth has stalled. Carlin says "we had to face the reality that we were not going to continue to double our revenue on an annual basis in a less-than-favorable economy. We are now learning to do more with less." Resource Options has 31 full-time staffers and 850 field contractors—down from 1,200 contract positions in 2007. Carlin expects revenue to reach about $12.5 million to $13 million this year, down from $14 million last year.

Still, reaching the 10-year mark, Carlin says he realizes that owning your own business is as much a huge amount of work as it is joy. "If going into business was easy, everybody would do it."

But he says his best lesson still comes from his days as a hockey coach. "The only way to run your business effectively is to hire people that are better than you and that's what I think I am best at. It's the players that win the game, not the coaches. I say hire people that are better than me and make sure those hires get in the habit of hiring people that are better than them."

Perman is a staff writer for BusinessWeek in New York.

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