Inside Kurgo: 5 Things I’ve Learned as CEO

Inside Kurgo: 5 Things I’ve Learned as CEO

Posted by Gordie Spater on 23rd January 2019

 

Gordie Spater, CEO of Kurgoa leading pet products
designer based in Salisbury, MA

 

1. Always build in a “Fudge
Factor”

I am by
nature an optimistic person so I am always certain it can be done tomorrow for
free. I have found even after careful
planning for all eventualities something always crops up. For example, our products are triple-quoted
with our factories and we have efficient logistics to deliver the product to
our customers, but before calculating our pricing we always add a small
“Factor” to the cost. This factor has saved our margins, and therefore our
business, year after year because inevitably costs go up, or the retailer
discounts are more than we expected. This same idea applies to adding time to a
schedule; stuff happens, and it’s important to give yourself some flexibility
so you don’t get crushed by unforeseen events. You may not know exactly what
will happen, but when it does, it will
cost you time and/or money. As an added upside, in the 20% of times that
things go perfectly you get the benefit too!

2. It’s a marathon

After 15
years in this business I have been tempted many times to “go big or go home.” I
have been drawn in by that idea, but in the end, I think being here next month
and next year creates a higher likelihood of success. Your customers want to
work with a business they can depend on year after year like a good friend.
Especially as your business enters years 3 to 5, I think you will find several
early prospects pick up their heads and say “Oh, these guys are still here, let
me give them a try." We all see the
rocket ship stories of Allbirds, Airbnb, and all the other rock star startups
in Inc. Magazine. Those are awesome, but they are also rare. In no way is this an excuse to sit back and
wait for time to help you out. In the marathon analogy you must put the work in
the early miles to be able to finish the race. At the same time, pace yourself
to be careful the early enthusiasm does not cause you to sprint and burn
yourself out. Being there at the finish is the goal and it requires you to put
one foot in front of the other mile after mile, all the way to the end.

3. A steel gut is a valuable
asset

My wife and
other co-workers joke frequently I am willing to eat some questionable items in
the fridge. That may be true, but this “skill” also came in handy in the early
days of Kurgo. The highs and lows are
severe in those first few years. You can go from getting a big order to finding
out your packages are coming unglued in a matter of minutes, and each of these peaks
and valleys are important at that point. As the company grows there are more of
these and each one matters less because they tend to balance out, but in the
beginning each up and down is critical; and you feel all of them. The best
advice is be calm and aware of what is happening to you, then move onto solving
the problem.

4. Minimize money stress by
picking the right source of funds

There is
enough stress at the start of the business just getting it going. Finding
sources of funds that do not add to that stress is very helpful. Kurgo was funded by four long-term friends
and family who were patient. I told them upfront only put in what you are
willing to lose. They believed me, but also trusted Kitter and I, so over the
15 years they were invested they let us run the business without interrupting
except when asked. I have heard many stories of investors driving lots of extra
work for the management teams. In the
end it comes down to trust: if the investor is not going to trust you it will
likely create a lot of unnecessary stress for both of you.

Likewise,
about 5 years in we finally found a commercial banker who trusted us and could
deliver on what he promised. Finding him
gave me back a few hours of sleep each night just to know we could depend on
our bank to support our business as it went through significant growth.

5. Make a plan, stick with it,
then pivot

These pivots
happen more frequently in the beginning and less often as the company
grows. The analogy of a boat is great:
at the start you are in a small boat, maybe a waterski boat, you need a
destination, but that boat can turn on a dime because it is just you. As the company grows you still need the
destination and you also need time and planning to adjust your path, this is
more like a cruise ship. In both
situations you need to have your plan, but you need to be vigilant about what
the market is telling you and adjust your course or your destination if
necessary.

When
Kitter and I started Kurgo we thought we were going to develop and then license
products however, we quickly realized it was not a sustainable path to success.
About a year later we adjusted from doing mostly automotive accessories into
pet accessories, and then a focus on only branded pet accessories. That all happened in rapid succession in the
first 3 years of our business when there were just a few of us in the company. Thereafter
the adjustments were slight course corrections which could be planned and
executed against by the growing company.

What I’m
still learning…

Make quick and final decisions

This is
something I am still working on. There
are a lot of decisions to be made every day and it is hard to see all the
implications of those decisions. I
believe the most important thing for the business and the people who work in it
is a clear direction. The longer you
wait to set that direction or make that decision the less productive your team
is. Furthermore, after doing this for 15 years the initial data we get and gut
feeling we have is typically 80% correct, moving forward quickly is more
important than getting that final 20% right.

Editor’s note: Gordie and his
brother Kitter founded
Kurgo in 2003 to help dogs and their owners get out and
enjoy the world together. Kurgo products
can be found at pet specialty retailers nationwide. The company was acquired by
Radio Systems Corporation in October of 2018 and continues to be run by the
team from their Salisbury, MA headquarters.

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