Of the 500 letters that went out, 50 generated responses. Callers would be put on hold by Glickman and then told they were being transferred to the coordinator for their country, who was always Sandler. Ten of the 50 respondents ultimately became agents. Sandler tapped friends in South Africa to help him locate agents there and even recruited three men as agents for other African countries when he happened to hear them speaking among themselves in another language in a Las Vegas hotel elevator.
Sandler offered agents commissions of 7% to 15% of net revenues collected, depending on how hard the agent negotiated. When the agents who signed on asked for agent agreements, customer contracts, service instructions, order-processing routines, and so forth, Sandler promised to fax the documents over straightaway. Then, since Justice didn't have any such documents, he'd write them, often staying up all night, since many of the agents were eight or more time zones away.
Sandler gradually built an in-house staff, which he refers to as his United Nations. There's Phillipe Lenoir, one of the men from the elevator, who is from the Congo and is part Belgian, and who speaks four languages fluently. There's Hans Ye, who is of Chinese descent and has lived in Germany. Altogether, 22 languages are spoken at Justice.
Almost all Justice's growth was bootstrapped. Glickman put in $80,000 of his own money over time and would occasionally make short-term loans to the company; later his father would end up lending the company $100,000, which was paid back in full, with interest, within a year. Other than that, Glickman borrowed nothing and took on no investors.
One reason Glickman was able to remain free of debt and investors was the commission policy he had instituted with agents from day one: commissions were to be paid only on collected revenues, which in effect enlisted agents as collectors. What's more, if a customer skipped out on its bills, 50% of the bad debt was charged against the agent's commissions. "The agents would say, 'Why? You're the one checking their credit histories," recalls Sandler. "We'd say, 'Yes, but you're the one looking this person in the eye. You should be able to tell if there's a problem." As a result, there was rarely a problem with accounts receivable, and cash flow remained healthy.
But every time it looked as if Justice was cruising, Glickman found a way to put the company in danger again. He seemed to suffer from a near-pathological need to take on new business opportunities that by all accounts, including those of his staff, Justice was incapable of handling. A large South American insurance agency wanted 100,000 prepaid international phone cards ready to give away as a promotion for the 1994 World Cup games in three months? Sure, no problem, said Glickman; send out the contract. Never mind that IDB doesn't do prepaid phone cards. We'll find a way. Customers are asking for international fax and paging service? Sign them up. We'll figure out how. And Justice always did. The lesson: It's better to scramble to deliver a product you've already sold than to struggle to sell a product you've spent money preparing to deliver. "I didn't feel comfortable unless I was bringing us out on a limb of a limb of a limb," Glickman says. "We'd have to turn the company upside down to make it happen, but that's when things get fun. It's what we all thrive on here."
Richter agrees--which is a good thing, because he ended up taking over product development and operations. Looking like a mischievous teddy bear, with sideburns that put Elvis to shame, Richter remains the number two person in the company, running day-to-day operations. When Justice has to race to fulfill some over-the-top promise of Glickman's, "it's hell at the time," Richter says, "but when it's over you feel great."
That sentiment was put to its ultimate test in 1994, when IDB Worldcom was acquired and the new owners gave Justice six weeks' notice of their intention to pull the plug on the switch that served as the physical hub of Justice's entire business. That wasn't nearly enough time to find another phone company that would provide as good a deal and then to get set up on its switch. No problem, said Glickman. Justice would get its own switch and program and operate it itself. It would become a full-fledged phone company. "If someone told me now that a small company with no experience or expertise had to find and set up its own switch on such short notice, I'd tell them it was impossible," he says. "Luckily, we didn't know that then."
Ninety days later, the hot cut--the one that had provoked astonishment from Glickman's lunch mate--somehow went off without a hitch. Justice Technology was actually a technology company.
Once the technological ice was broken, there was no stopping Glickman, Richter, and Sandler. Sandler would alert Glickman to a new opportunity, and Glickman would authorize him to seize it. Then, when the orders starting coming in, he'd tell Richter to find a way to deliver whatever Sandler had sold.
Many of the opportunities were still in callback, especially in countries where government regulation was still oppressive, such as most African and South American nations, as well as many Asian ones. Glickman wanted no niche left unfilled. Sandler discovered, for example, that European cell-phone users are naturals for callback services, because in most European locations you're not charged for airtime when you receive a call.
Still, the writing was on the wall for callback. Deregulation of the phone business was starting to sweep the world, which meant that traditional "direct dial" international phone service was dropping in price in many countries, eroding callback's advantage. That was no coincidence, points out Glickman. "Callback was one of the major catalysts for deregulation in other countries, because the state-run phone companies couldn't compete with us," he says.
To make sure Justice didn't sink along with callback, Glickman directed Richter and Sandler to bring the company into the direct-dial business. Justice now owns local switches in several countries and has even bought small local phone companies in Belgium and Argentina, allowing many of their customers to dial straight through without callback.
