Even Home Depot Was Once a Startup
One of the things everyone should remember is that every large, successful company was once a small business startup. If you read the stories of corporate founders, or hear them speak, their stories all bear a strong resemblance. I got to spend several hours talking to Bernie Marcus, the founder of Home Depot, and was fascinated by his story of how he created one of the juggernauts of American business. It’s a story worth hearing and remembering.
In the 1970s, Bernie was at Handy Dan Improvement Centers, another home improvement store. He was fired from Handy Dan, and decided to create his own business, Home Depot.
At first, the business was really struggling. They had a store, they had employees, but they didn’t have the money to pay for all their expenses, with workers and merchandise. Bernie went everywhere for a loan. Everyone turned him down. Nobody thought he had a business that would make it. In his desperation, he offered Ross Perot a substantial ownership percentage of the company in exchange for investment. He said no. Things were bleak.
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Finally, he turned to his last resort for funding: a banker he had worked with when he was at Handy Dan. He got that banker to fight for him to get the $5.5 million loan he needed, and it somehow was miraculously pushed through. Bernie later found out that the bank had written off the loan as a complete loss the very next day—nobody thought he would make it, and that banker had put his reputation on the line to get him the money he needed. For the first three years, things were so tough that Bernie’s wife wasn’t sure he would survive, let alone succeed.
As we all know now, Home Depot did make it. And they made it bigger than anyone ever imagined. But it all started as a crazy idea that nobody expected anything from, except the people who were doing it. Bernie was the CEO at Home Depot until 1997, and he kept the company entrepreneurial. He kept his hands in the soil, and never let himself be distant from the company’s employees. It was constant effort, constant evaluation, and years of hard work. Home Depot could only succeed if it worked for its customers, its partners, and its employees. If Bernie had tried to make Home Depot all about him, it would have failed. By making it a company oriented toward other people first, it created huge rewards for everyone.
Bernie said something that really resonated with me, because it’s something I believe about business, too: “Businesses start going up when they get going, but then they eventually plateau. Most companies don’t reinvent themselves, and they start to go down. The only way to keep going up is not to get caught up in doing the same old things, to always look for ways to innovate and reinvent yourself.”
These principles translate to every realm of life, from athletics to business. The lessons I’ve learned from my mentors have taught me that leadership matters. Coaching matters. These people have left an imprint on me, showing me the blueprint to success in business. I encourage all of you to keep pushing and to keep learning and reinventing yourselves, and never stop. That’s essential to a full, well-lived life.
This article was originally published on AMAC.us.