How This Serial Entrepreneur Made All Eight of His Companies Profitable
In the past 25 years, Steve Jillings, a New Zealand-born entrepreneur, has either founded or taken over eight different startups and grown them into large, profitable businesses.
"Over that period of time, you make so many mistakes and learn so many lessons that you understand what to do. It's kind of like seeing every movie out there," Jillings tells Inc.
Jillings became the CEO of Los Angeles-based Internet security provider TeleSign in 2010 when it only had a dozen employees. The company, which specializes in identity authentication and other security services for nine out of the top 10 largest Internet businesses in the U.S., has doubled its revenue each year since he took the reins. In 2012, it had $25 million in sales and last year generated $50 million; by the end of 2014, Jillings says, it will be up to $100 million.
His ultimate goal is to have TeleSign "IPO-ready" by 2015 with sales of $200 million a year. So how do you apply the right strategies to scale up a fledgling business with 12 employees--as TeleSign had just four years ago? Below, check out Jillings's growth tips.
Assemble the dream team
Over the years, Jillings has built up a network of go-to executives with whom he has good chemistry. When he was tapped to take over TeleSign, he thought about his teammates from previous companies like Frontbridge Technologies, which he led through a multimillion-dollar acquisition by Microsoft. "The first thing I always look at is who is going to be my team," he says. "You need to put in the right management team who is going to own everything that has to do with their part of the business and grow it like crazy."
The first call he made was to Frontbridge's CTO, who had helped Jillings scale the secure messaging service company. "Finding those people who can scale with you is the first step," Jillings says. He filled spots for CFO, business development, worldwide sales, and vice president of operations, all from companies he had run in the past. "The key is to pull together a team of people you know and have worked well with before. This way, everyone automatically knows their spots, they know each other's personalities, they know each other's blind spots, and it enables you to grow extremely rapidly," he says.
Never stop recruiting
"We are constantly recruiting to find talent," Jillings says. "We've been lucky to find high-quality people through reputation or getting the word out there. But you need to always be looking."
Delegate and provide freedom
If you want your company to grow quickly, you need to delegate as much responsibility as you can. The CEO needs to have time for big-picture issues. "My management style is to set the vision and direction of the company and then work with each of the executives to ensure they are set for their business unit's direction. Once we're in agreement with the direction, I'll let them go," Jillings says. He has a half-hour meeting with his direct reports each week to make sure everything is tracking in the direction it should be. "I hire people and pay them well so I don't have to do their job. I'm not a hands-off manager, but I give all my folks the opportunity to do their job in the way they feel it should be done," he says. "They build their organization in the way they feel it should be built and so long as it's aligned with the goals and vision for the company, there's no problem. This creates an autonomy that makes everyone feel free to build and create."
Focus on profitability
TeleSign is on track to double its revenue this year and keep on going. "What I am [most] proud of with a growth rate like that is that we are able to run the business profitably," Jillings says. Many startups, he adds, fail because they have similar growth rates, but "burn through colossal amounts of cash." He stresses that you cannot waste money as a startup. "I'd much rather spend money on people and services for our employees," he says. "We have a cool office, but it's cheap, Our furniture is comfortable, but it's not expensive. Spending $1,000 on a desk setup has no ROI."
Focus on customers
Just as you need to know what not to spend money on, you need to make smart investments that will translate into recurring revenue. "One of the areas [where] we invest a lot, and shows in our customer loyalty, is client services and support. We made a decision to provide 24-hour support a long time ago. It's expensive, but it's the type of service when your customers need to speak with someone live, they can," he says. "Having high-quality customer support gives our clients more confidence in us. It helps foster loyalty and our customers continue to spend more money with us." He says automated systems kill your reputation with clients, especially if it's a large account with a Fortune 500-size company.
Keeping the biggest fish
TeleSign's clients are huge Internet businesses, but Jillings warns that big companies can be difficult to have as clients because employees leave, get promoted, or moved constantly. "You need to spread a large web throughout the organization," Jillings says. "The worst thing is to have one contact and then they tell you they're moving departments. You're back at square one trying to convince someone you don't know to continue spending money with you." He says you need to understand the organization's structure. His sales team understands who reports to whom and knows where each employee fits into the organization. "All of our salespeople have written org charts on each of their clients, going up and down three levels in each direction," he says.
WILL YAKOWICZ | Staff Writer | Reporter, Inc.com
Will Yakowicz is a staff writer for Inc. magazine. He has covered business, crime, and local politics for The Brooklyn Paper and was the editor of Park Slope Patch. He has also reported on the West Bank and Moscow for Tablet Magazine. He lives in Brooklyn, New York.