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Eric Schurenberg has made a career of telling the stories of the greatest Entrepreneurs and companies in the world. What he has learned could change the direction of your business.
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The Secrets of Business Success with Eric Schurenberg, Editor-In-Chief of Inc Magazine
Welcome back, listeners. For those of you who figured out who’s with us today, I’m super excited to be welcoming Eric on to the show. Eric, you’re a rock star. Thanks so much for coming on.
Jon, you’re too kind. It’s great to be here. Thanks for having me on.
Eric, to confirm for our listeners, what’s your full name and your title and company and why people might know about you.
When people discover what position you hold, which is I have to say one of the critical media positions for entrepreneurs and business owners in terms of gaining knowledge, what’s their most common question?
“How can I get on the cover?” is their most common question. The answer to that is it’s complicated. It’s something they probably already wanted to do anyway, which is to create a successful company that other entrepreneurs can learn from and that other entrepreneurs instinctively admire. Pretty much that’s the secret, that’s a pretty high hurdle to clear as we all know but that’s the shortest path.
Who are some of the people who have graced your covers?
They range from Elon Musk to most recently, Polina Raygorodskaya, so ranging from some of the most famous entrepreneurs in the world to people who are not yet known but perhaps ought to be. Polina is the Founder and CEO of Wanderu, which to simplify it a bit, is maybe kayak for trains and busses.
There are a lot of people who want to be contributors and participate in the knowledge that you share. What advice would you give people who want to create content?
We’re always eager to bring new voices on to Inc.com. The thing that you should probably remember as you apply to do that is that the audience is made up of business owners or people who are considering making the leap into entrepreneurship. The information that you put into your column should be valuable to them. It doesn’t mean it should only be things about how to do a Section 135 transfer or a 179 deduction, things like that. It should be about improving your life or making yourself a better leader or about industries that entrepreneurs need to master so that they can do well for their company. Inc. is about service and the audience we serve is this very important audience of people who have the guts to go out and start companies and innovates. People who in my opinion are the engines of free enterprise whose career path is one of the hardest but also the most necessary in our economy.
I find it always interesting when I talk to people who say, “I want to write a book. I want to write an article.” They fundamentally lose sight that if somebody is going to be reading what they create, it has to provide value for them. One of the things that I’ve consistently noticed about your publication is that it is fundamentally in the service of its reader. When companies forget that and lose sight of that, then they lose the connection that they have with their audience.
That’s true of any industry but I can speak specifically about how it works at Inc. There are, I would say, four key ways that we serve entrepreneurs at Inc. Media. The first is to inspire. The stories that we tell are the stories of entrepreneurs who have overcome difficulties and gone on to success. The lesson that you can take away from it is how they did and you can follow their footsteps. Even more important is the display of how they rose above the inevitable obstacles that entrepreneurs face. I do really think that a key part of the stories we tell is to inspire people to get up and make one more cold call or make one more tweak to their coding. Just do it one more time and not give up.
The second service we provide is pretty much straight down the middle of the plate advice. There are lots of tips on how to be a better leader or how to manage your work force or how to use technology to cut cost in your business. A third goal of ours at Inc. is to create connections. Entrepreneurs need to talk to other entrepreneurs, not only to do deals and find vendors and other things but also because other entrepreneurs are the only people you can talk to when you’re the boss. You can’t confess things to your investors or to your employees. Besides, no one understands what you go through as a business owner like other business owners do.
Finally, the fourth service we offer is advocacy. We believe in what entrepreneurs do. We believe that it’s in the best interest of everyone in the free enterprise system to help entrepreneurs succeed. That means getting rid of unnecessary regulation, of simplifying the tax code, of opening up rules that would limit immigration. Because companies, especially fast growing small companies need to be able to tap the global labor market to find the best people. Also, it’s obvious if you do any of the research that entrepreneurship runs in a much higher level among people who are born elsewhere and have come to the US to make their fortunes here. Immigrants or the children of immigrants are about twice as likely as native born Americans to become entrepreneurs. If you believe as we do that entrepreneurship is really essential to the health of an economy, you want more people who are coming here from abroad, not fewer.
As the son of immigrants, I saw how hard my parents worked and how driven they were to succeed and contribute and do whatever they could. If memory serves, I came across a study that looked at the benefits of the economy that immigrants provide and consistently, it uplifts national GDP and creates more jobs all around.
There is no doubt that immigration is a boon to this economy and it’s one of the great strengths that America has. We are still seen as a destination by the most ambitious and skillful people in the world. Out of whatever dark feelings that grip the country at the moment, we flitter away that incredible advantage we are, as Mayor Bloomberg has put it, we are committing economic suicide.
As one of the biggest values that you provide are advice and tips to support entrepreneurs and business owners, I want to get into the nitty-gritty. What are the three biggest pieces of advice you could give a business owner looking to succeed?
I think the first one is that you have to learn to delegate. This is a difficult thing for a lot of entrepreneurs because the company is their baby. They built it with their own vision in mind. If you’re going to grow, you have to be able to let other people do stuff. You have to let other people have a good idea once in a while. You have to give them responsibility and make them accountable. It’s a hard thing for people who tend to be control freaks or just naturally built that way and have a sense of proprietorship about everything that happens in a company. Let’s face it in the beginning days of your company, you do everything. You hold every job. I think that if you can make that transition to enlightened leadership, you are on the path to be able to make your company grow.
Another important tip is to manage your cashflow. We see at Inc. because we cover a lot of fast growing companies, situations that are really tragic in which companies are growing very rapidly and have seem to captured lighting in a bottle with their product or service, and the innovations that they’ve created. They go out of business because they can’t manage their cashflow. It’s incredibly important to make sure that the money is on-hand, and that you have to make sure that when you have a lot of accounts receivable that you have a way to make sure that that can be converted into cash. That is bad cashflow. Cashflow crunches are the great destroyer of young companies.
The third piece of advice I would give to entrepreneurs is not to be beguiled by the common assumption that seems to be abroad about entrepreneurship is it’s all about getting funding. Shark Tank and pitch contests and others that are popular because they create a competition that was a stressful situation that makes really good TV, leave you with the impression that if you’re not raising money from the outside, you haven’t really succeeded. You have to recognize that once you’ve raised money, you haven’t finished the game, you’ve only begun it. You’ve also changed the rules in quite important ways. You now have a bunch of investors whose needs come before yours. That’s just the way capitalism works. You have truly changed the game in giving yourself an employer essentially that you didn’t have before when it was just you against the world. If you can possibly bootstrap, you should do it. You should raise money only when you need it and only when there’s no other way to make your company grow.
I find this a really interesting thought because everybody underestimates the amount of time it takes to build trust with an investor, build interest and actually close a deal. Once you look at the terms of the deal, if the investor wants to own everything, they’ll put a small footnote in there to protect themselves. After all they’re putting a lot of hard earned money and risk into whatever it is that your company is. Often it seems that the better solutions or the more effective solutions would be simply working longer part-time until you can be cashflow positive and that even puts you in a better situation for investment.
Raising money is not the goal of entrepreneurship. Building a successful company is. There is always an invisible price to pay when you raise money whether you’re doing it with debt or with equity. It should not be seen as a good in itself. It’s only a means to an end. You have to weigh the cause against the benefits.
What are the secrets nobody talks about in entrepreneurialism or in running a business?
A lot of people are stunned by how lonely the job is. You can’t open up to the people around you because they work for you and you need to keep them motivated so that the inevitable self-doubt and moments of insecurity that everyone experiences particularly someone who’s hanging it out there like an entrepreneur is, you can’t share them with a lot of the people around you. Same with your investors; you don’t want them to lose confidence in you. You need to put on a face for pretty much the entire world. Dealing with that being honest with yourself about the psychological pressure that you’re putting on yourself as an entrepreneur is something that people need to face up to. I think it’s something that catches them by surprise. The best answer to that is to join an organization of other entrepreneurs and there a number of them: the Entrepreneurs’ Organization which often goes by EO. YPO is another one, the Young Presidents Organization. Vistage is another one of those. The Inc. CEO Project is another one of those support groups that we run. I think that’s one of the uncomfortable secrets of entrepreneurship.
Before we switch gears, I love the story because it’s a little unexpected. I always thought Inc. stood for incorporated. It turns out that it doesn’t. Can you tell me the backstory on this?
Sure. When Inc. was founded by an entrepreneur who recognized that there was no publication that served the needs of small business owners, he thought a lot about the name to give it. I think that those founders thought of themselves as a place where small businesses could go to get the advice they don’t get anywhere else and take route. Inc. became a play on words, a double entendre using the designation for a limited liability company in the US system. Also naming it after a place where small companies go to be born, an incubator. It certainly looks exactly like the abbreviation for incorporated but it’s not. We think of ourselves as that entity where private companies can go to be born or get stronger. We think ourselves very much as an incubator and not as a publication that serves public companies.
Besides going to Inc.’s website, what have you found are the best resources for business owners? Are there certain books that you thought, “That was phenomenal?”
It’s hard for me because I spend a lot of my time thinking about Inc., so please go to Inc.com or read Inc. magazines. I think one of the best resources and it’s one of our imagined is other entrepreneurs. Nobody understands what you’re going through better than people who are doing it themselves. You will find that entrepreneurs are very willing to share the facts about their own journey. An organization like the ones I’ve mentioned is by far the best place to go to get advice and a sense of comradeship with other people in the entrepreneurial fraternity. Among books, I see so many of them. I think there are books that are better than others, but The Hard Thing About Hard Things by Ben Horowitz.
I have to say, Eric, I thought it was one of the best entrepreneurial books I’ve ever read in my life. Most entrepreneurial books talk about, “I did this. I tried this tactic and this is what caused me to succeed.” In this book, the author literally failed day after day barely holding a company together, manages to pull through over and over again but deals with the storm of everything that could go wrong. He’s so committed to his team to ensure that they keep going, they have security in their jobs and that the investors are taking care of. It shows you the side of entrepreneurialism that nobody likes to talk about.
I’m glad you agree with me on that. I felt the same way about the book. The author is Ben Horowitz and the DC firm is Andreessen Horowitz. What struck me about it too was the granular detail that he went into about how to make decisions and what the right decisions are for entrepreneurs, none of which are easy as Horowitz points out in his book. One of the human causes of growing a company is that the team that you assembled to start your company doesn’t necessarily equate with the team that you need to grow your company once it reaches a certain scale. There comes a point in which the people who slept under their desk with you and ate ramen for six months in a row with you when the company was just starting out have to drop off. That’s difficult.
A lot of the decisions that you face about when to fire a customer who turns out to be more trouble than they’re economically worth dealing with, investors and their different agendas that are different from yours. Those are all among the hard things that entrepreneurs have to face. Horowitz’s book is really one of the most unvarnished looks at entrepreneurship that I’ve ever come across.
I couldn’t agree more, Eric. Are there any other books you really love?
One book I’m reading right now is called The Startup Checklist by David S. Rose. It is incredibly thorough about all the steps that you need to take to get a company off the ground. The checklist in the title refers to the kind of checklist that a pilot or a surgeon goes through to make sure they’ve covered all the basis. This is very much about that. Among other things, it talks about all the different vendors that he has encountered in his long career as an investor and entrepreneur himself. It gives you a rundown in his personal review of all the partners that you can line up to start your company. This is a book that I would commend not for its readability but as a reference book, a step by step guide to getting a company off the ground.
It’s amazing the resources that entrepreneurs have nowadays that literally didn’t exist ten years ago. When I started my first company, none of these was around. We were still in the early days of the internet. Getting advice or figuring out how to get a mentor or getting an answer on how to even incorporate meant that we have to go to a law office. Nowadays, you can just do a search on your site and find 90% of the answers in it.
It’s truly amazing. You used to have your own servers and now you can go to AWS or GoDaddy or other host that you needed to often, in many cases, write software for your CRM or just the basic functions of the company. Now, there are many, many companies out there that do that work for you. As a result, the general statistics that comes to my mind about the cost of starting a company compared to where it was as little as ten years ago, is the cost has declined by 95%.
Let’s switch gears a little. One of the questions I always ask guests is imagine you get a random email, a message in your inbox and the person is asking to meet you for coffee. What is it that they have to say for you to accept the invitation? Eric, you are a busy guy. You run a major magazine. You are the president of it. You’re also the editor-in-chief. There’s no lack of things for you to do and take care of, plus you have a family. What would have you take the time out of your schedule to actually meet with somebody?
I think that there are a couple of things that would capture my attention. One is what sociologists refer to as social proof. Some credentials that you have with somebody that we know someone in common who would vouch for you or failing that, credentials that capture the eye that you have started, other successful companies that I’ve heard of raised a lot of money from investors that I have heard of and whose imprimatur would matter a lot to me. Social proof is an important thing. Another thing would be something that would make a very good story that appeals to the journalists in me. I think one of the key services that Inc. provides is inspiration. A story about having to overcome hardship and created a company that is a model for other entrepreneurs and a tail of obstacles cleared and self-fulfillment realized and just that kind of story that makes you feel that this is a great economy that where we can do this and that this person’s life story is inspiring. If I were an entrepreneur and I read it, I would be energized to go out and keep up the fight for another week, month. That’s something I’m always on the look-out for.
I often ask my guests to share a really embarrassing moment or a story or some kind of human secret. Some people share their anxieties and their fears. One of my favorite stories involved an MTV VJ peeing himself on camera in front of Justin Timberlake. The story is really ranged drastically. What would be something that you feel comfortable sharing?
I should have my family, friendly, G-rated embarrassing story handy on the tip of my tongue for questions like this, but I don’t. I’m incredibly easy to embarrass so it’s like shooting fish in a barrel. As a delaying tactic, I will speak in broad terms. I find that as a leader of a business and as a human being, the ways that I’m most likely to go wrong and embarrass myself and make mistakes that I regret, later on are when I’m not true to myself but instead think about my image. I think, “What should the president of Inc. or the editor-in-chief of a publication do? What would be the right thing for a person holding this august title?” Inevitably, I end up playing a character role of some august personage that I’m not and end up making a fool of myself. I would say that I tend to be prone to dad humor, which reflects being a corny person from the Midwest and reflects also the paternal way I feel about my staff. I am definitely afflicted with dad humor, which elicits more ‘I’ roles than it does laughter. That’s a general embarrassing moment.
If you could be any comic book hero, who would you be?
I would be Superman. The flying part of it is just too good to give up and some of the other stuff: bending steel with your bare hands. Being able to just jump up and fly, that seems to me like the ideal thing. The other thing too is it gives Superman some dramatic tension is kryptonite. Everybody has a failing. Superman would be far less interesting if there weren’t kryptonite around.
Imagine you’re invited to a dinner with three people you’ve always want to sit down. They have to be alive. Who would you pick?
They would be Elon Musk, for sure, a person whose capacity for vision and execution, staggers the imagination. The idea that the man who invented the most commercially viable electric car company whose products are very cool is also the guy who founded a company that has done what most nations has never done, was to create a space program. That person has got to be fascinating. That person would definitely be at lunch with me. I’m also in awe of people who display incredible courage and self-sacrifice. There are many people like first responders come to mind immediately now as we’re speaking in the wake of the Las Vegas tragedy; the people who would run towards the sound of gun fire. I’d like to see what moves that kind of heart. The last person would be someone with another kind of quieter courage. While he’s not alive, a person who embodies that in my mind would be Nelson Mandela. Love to have him in dinner. That faith in The Better Angels of human nature is something that I think we could all benefit from being exposed to.
Eric, that’s a phenomenal list. I really want to thank you for coming on and sharing all your wisdom and advice to business owners. As you know, I’m a huge fan and fortunate enough to get to contribute to you sometimes. If people want to find out more about you besides following Inc. on Twitter and going to Inc.com, where can they specifically find out more about you?
Those are the two places where I’m most public. I would advice other people who want to meet me in person to come to an Inc. event that we have plenty of them around the country. The next one is the Inc. 5000 in Palm Desert. We just finished Women’s Summit and one of our iConic Tour events that we do in conjunction with CNBC in LA. I love going out into the audience after my work of moderation and hosting is done and talking to real life entrepreneurs and hearing their stories and capturing their energy. That would be a great way. If any listeners are moved to do that, please mention that you heard me on Jon’s show. That will certainly win me over or win you over a good listen from me.
Thanks so much, Eric. Listeners, stay tuned for the anonymous portion of the podcast and see if you can figure out who the guest is.
About Eric Schurenberg
Eric Schurenberg is Editor-in-Chief of Inc. Previously, Eric was Editor-in-Chief of BNET.com and CBSMoneywatch.com for CBS Interactive. The sites together won more than a dozen awards during his tenure. Before CBS, Eric was managing editor of MONEY Magazine, which won the Luce award for service journalism in each of the four years it was eligible. As a writer, he is a winner of a Loeb Award and a National Magazine award. He is a regular commentator on Nightly Business Report on PBS and has been a talking head on CNBC, CNN, Public Radio International, The Today Show and Good Morning America.
Anonymous Guest Interview
Listeners, as you know, this is my favorite part. I’m super excited to have a really close friend with me today. Roy, thank you so much for coming on.
Thank you for having me.
Let’s get down to basics. Where did you grow up?
Birmingham, Alabama, pretty much the south as a whole. Memphis, Tennessee until the third grade and then after that, parents moved to Birmingham, so Alabama is where I was until I got my high school diploma.
Where do you live now?
I live in New York City.
Did you come here for work?
Was there a certain moment, teacher or somebody that inspired you to go down the career path that you went?
I don’t know if there was a particular teacher but I definitely have a moment that I know where I thought, “I think I could do this for real.” We had a public speaking class in college. I was at Florida A&M University. There was a week where we did nothing but impromptu speeches. The teacher would give you the topic. You’d have 90 seconds to prepare and then you went up and gave a five-minute speech on something basically in the blind. I went up and I was able to filibuster my way through a lot of weird topics and speeches. I always got laughs whenever I performed to the point where the teacher flunk me one day because she accused me of deliberately trying to railroad the assignment by making people laugh. I don’t know why they’re laughing. I legitimately cannot tell you. I wasn’t that funny in high school. I was fairly quiet with the exception of when we played baseball. I was a class clown on a baseball field. There was that moment where in retrospect that was essentially an open mic night. Essentially, I went up in front of a bunch of strangers and try to joke my way through topics with a little bit of infusing, trying to speak intelligently but trying to make you laugh so that you would forget that I have no clue what the hell it is I’m talking about.
It’s not surprising at all what you do.
It was that moment and then also I was a waiter at Golden Corral. I figured out really fast that if I crack a joke at the table, I’m more likely to get a better tip. Whenever I greeted a table, I opened them with a joke and by the end of the day, I had a joke that worked at all tables, all demographics and all ages. Week by week, I had an arsenal of buffet and stupid joke material, “This is basically like comedy. Maybe I could do this.”
Was there a certain accomplishment in your career that you’re most proud of?
I’m very proud of being able to have performed on David Letterman and Def Comedy Jam, which isn’t something a lot of comedians can hang their head on. In terms of what I was wanting to accomplish as a performer, which was to do something that connected with as many people as possible, I think being able to perform in those two mediums. I don’t think there’s anything whiter than a Letterman audience and there’s nothing blacker than a Def Jam audience. To be able to step out on both of those stages with just my thoughts and my own experiences, it’s something I’m proud of.
Let’s give the audience a sense of what you look like. Who would play you in a movie?
Anthony Anderson, maybe Kenan Thompson if he lost twenty pounds or if I gain twenty pounds, one or the other.
I think your dad could be played by Leslie David Baker from The Office.
Yes. That’s always the black dude that was just grouchy in the corner, rarely had any lines. I get Mark Curry, Hangin’ with Mr. Cooper. I get him from time to time. I’ve been alleged that I look like him. We’ll see.
What’s the craziest thing that you’ve ever done that led to your success?
I was probably two or three years in the comedy and I basically carried a lie for a day and a half and it opened up two doors for me. I wouldn’t necessarily recommend this to anyone.
What did you lie about?
At the time, I just moved home to Birmingham. The Hip-Hop Morning Show that was on the radio there, before I got to town, was looking for new comedians so that they can have a new comedian on the air. I had a journalism degree I figured, “I’m perfect for you,” but so many comedians that went in and fail that the Morning Show host basically decided he didn’t want a comedian on his show. He just said there are no comedians in Birmingham. What I knew at the time was that The Hip-Hop station sponsors the Friday Night Comedy show any time there’s a black headliner in town. This particular week it was D.L. Hughley. I knew on Friday Night, the Morning Show, the entire radio station would be in the comedy club. All I had to do was get on stage in front of the morning show DJ and if I do that, then he’ll see me be funny. When you’re auditioning comedians for radio, it’s like football. It’s opportunity. If the ball never gets thrown to you, you can’t prove that you can do football good. If there’s a bunch of scenarios where you can’t make a joke on the fly, but if they see you were funny somewhere and they know you’re capable of being funny, they will give you more time in studio to develop and grow as a radio comedian because they’re not the same discipline.
I go to the radio DJ and I go, “I know you’re not auditioning anymore comedians but let’s do this. I’m opening for D.L. Hughley on Friday night at the comedy club. If you like me, then you give me an audition on Monday.” He goes, “That’s fair. I’ll see you on Friday.” I’m not booked to open for D.L. Hughley. I’m not even past at the comedy club to perform on the main stage yet, which in Birmingham, the Stardome is a huge club. It’s one of the major clubs in the south. I was performing in the smaller room, which is basically Double-A ball. You work your way, you do your time, and eventually you get put on the main stage to do it on a weekday. You don’t get to open for a weekend act like D.L. Hughley out the gate. That’s unheard of. I called the comedy club and I go, “I just got hired at the radio station and I’m going to be the new comedian on the radio station. I’ll be hosting instead of the morning show. Just make sure I get five minutes in front of D.L. Hughley.” Club owner didn’t think twice about it. He said, “Cool.” Friday night comes, all I have to do is keep the DJ away from the club owner. I did that.
The club owner comes downstairs. I’m backstage. I’m in a full suit. I’m ready to go and then the DJ walks in. The club owner and the DJ never discussed the arrangement that I presented to them. I try to tell young comics, ”If you act like you’re supposed to be somewhere, eight times out of ten nobody is going to question your presence.” Bruce came in the room and he turns to the DJ. He goes, “You keep it short since Roy is going up. Go out there. Greet them, whatever. Then you bring up Roy and then Roy, you bring up D.L. Hughley.” D.L. for the most part, a guy like D.L. does so much time he only has one opener. It’s not a three comic show so I shouldn’t even be there. I go on stage. I do probably the most magical five minutes of my career up until that point. When I come off stage, the DJ is standing right there and he says, “See you Monday morning.” That was the first day of a twelve-year radio career.
There was no risk. In my brain, there was no risk. The worst that could happen is that you find out I lied and you don’t let me perform. That’s not punishment. I was already not going to perform. I’m already not working at the radio station so what you are going to do? Not talk to me anymore? In my brain, I was figuring, “What am I truly risking? I’m not risking anything?” Give it a shot.
Was there a moment or experience that made you feel you had arrived to some degree?
I don’t feel I’ve ever really arrived per se but if there’s one place where I feel I belong and I’m an equal is the Comedy Cellar in New York City. That is the comedian’s gem. That’s the stylish gem where all of the greats come to work out. It’s not uncommon at the Cellar at the comedian’s table to see Louis C.K. and Chris Rock, a lot of the other great, Aziz Ansari, and they’re all just there chilling with other guys who all passed at the Cellar. To just have one of those guys say, “What’s up, Roy?” Just a quick, simple acknowledgement that you’re one of us, that you’re in the fraternity. I don’t need a long drawn-out conversation. I have nothing in common with Jerry Seinfeld. We have nothing to discuss. I have nothing to discuss with Chris Rock. We’re not in the same league. To have someone like that just give you the nod at the spot for comedians, to me that’s when I always feel I belong. That’s why so many guys always go back to the Cellar no matter what because it’s just a place where comics can all hang out and pat each other, “Way to go on booking that gig. I saw you singing in that show. Cool job.” There’s a sense of normalcy with which I’m treated by people that if I saw them in the streets it wouldn’t be a normal interaction. That’s probably where I feel most normal.
Last question, what hint or riddle can we give the audience to help them figure out who you are?
Based on the name of the show, you’d think I work every day of the week but I only work Mondays through Thursdays.
Listeners, can you figure out who Roy is? If you can, you could win a chance to participate in me or The Salon by Influencers. Good luck. Stay tuned next week to discover who he is.