Chairman Of The Bored

 

I'm a crossword nut, so let me pose this question in the form of a puzzle problem. You've got a seven-letter space to fill, and the clue is "improbable condition for an entrepreneur."

If you answered "success," put down your epncil and go directly to accounting school. That kind of cynicism we don't need. "Privacy" isn't right either, and although "shyness" and "modesty" fit the general format, neither word happens to be the one I'm looking for.

The correct answer is "boredom." That's right. B-O-R-E-D-O-M. As in weariness, tedium, and ennui. And I don't mean the boredom of working up profit-and-loss statements. I mean the kind of boredom that has a chief executive officer leaving his office early and seriously contemplating premature retirement, both of which I was doing just 18 months ago.

Surprised? Or maybe you're thinking to yourself, this guy Reed must be soft in the head. Anyone who's ever managed a fast-growth company knows that boredom isn't an improbable condition for an entrepreneur -- it's an impossible one.

That's what I thought, too, especially during the early days of Boston Acoustics Inc. When Andy Petite and I launched the company, in 1979, boredom was about the furthest thing from our minds. Both of us had worked for KLH Research & Development Corp. and then for Advent Corp., one of the first U.S. manufacturers of high-quality, low-cost home stereo speakers -- Andy in new-product development, I in finance and marketing. And having grown up with the industry, we pretty much knew how not to run a company. Still, the initial learning curve was steep.

Actually, from the moment Andy and I joined forces, the amount of continued mental and physical pressure was greater than anything I'd ever experienced. In all my other jobs, I went to work every day, did my work, did it well, got promoted, did that work well, and so on. There was a sameness to the routine that must resemble 99% of the jobs in America.

Starting my own company was completely different. Suddenly I had to learn purchasing, production, credit, sales, marketing, the whole bit. It was a crash course I couldn't afford to fail. Not only was Boston Acoustics successful from the word go -- we averaged a 77% compound annual growth rate over our first five years -- but there was no moment in my typical working day when I wasn't frantically conceptualizing at least three steps ahead. Moreover, the untypical days were, if anything, even more trying. One February day, I personally unloaded several hundred speaker cabinets from the back of a delivery truck. In a blizzard. In my street shoes. Aah, the pampered life of the fast-growth CEO.

What motivated me back then? Plenty. The sheer thrill of starting a business, of course. But even better than that was the satisfaction of sticking it to my former employer.

I had been fired from Advent, you see, even though sales grew from less than $2 million to more than $35 million in the eight years under my governance. Why I was fired I can only guess -- "poor forecasting," I was told -- but it took me a good six months to get over the bitterness. I felt orphaned by a company that had once felt like family, and revenge can be a powerful motive. Advent had been horribly mismanaged during the later years of my tenure, screwed up by people with no feel for marketing, new-product development, or quality control. When I cofounded Boston Acoustics, I was damned sure I'd show them how the business could be done right. In fact, we did better. Our company made a profit, theirs did not. Ours grew rapidly, theirs was shrinking. When the dust settled, Advent had all but disappeared -- rescued from bankruptcy by an outside acquirer. We were still there. So, to be sure, were other worthy competitors -- Bose, Polk Audio, JBL -- but I didn't have the same feelings of bitterness and disappointment toward them that I did for Advent.

Once that challenge was gone, Frank Reed hit the wall. My partner did not, largely because he continued to be involved in getting new ideas off the drawing board. But I did. True, there were some legitimate business reasons behind my growing restlessness. For one, we'd been uncannily successful at attracting and hiring good people to fill the slots our growing corporate structure was creating; the more of these capable people there were around, the less there was for me to do. And though Andy was still occupied with the R&D effort, I went from having my hand in every detail of the business to having to butt in on somebody else to do anything at all. A happy problem, certainly, but a problem nonetheless.

Also, the industry itself was maturing. I didn't realize it at the time, but a lot of the distributors and retailers I'd been doing business with for 20 years were no longer running their own companies. A younger crowd -- in some cases, the children of my old peers -- was coming in, and they didn't necessarily want to be associated with their fathers' buddies. This generation wanted to develop its own set of business contacts; while they might have thought the world of me, or of the company's product line, they weren't going to pick up the phone and call me to do the deal.

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