Born in Oklahoma in 1927, son of a land man, T. Boone Pickens graduated from Oklahoma State University in 1951 with a degree in geology. He married at 20 and had four children. He took a job as a roughneck for a refinery and then as a geologist with Phillips Petroleum. Citing difficulties with company bureaucracy, he resigned to work for himself. With $2,500, he began well-site and geological services work and soon found some investors to back him on a drilling project. He hit eight in 16 tries. He went on to build an oil and gas company – Mesa Petroleum – that by 1982 had assets of $2 billion. He became a corporate raider, profiting from successful and failed attempts alike. He earned $760 million from his “unsuccessful” attempt to purchase General American Oil.

Today, Pickens is chairman of the billion-dollar energy hedge fund BP Capital Management and ranks among Forbes’ 400 richest Americans with an estimated net worth approaching $2 billion. Earlier this year, he made a donation to his alma mater that is currently valued around $250 million.

What tips does he have for the owner of a small private company? Plenty.

• Find assets and put them to profitable use.
• You must have total dedication, at all levels for your organization, to adding value to the customer.
• Instill and nurture entrepreneurial instincts – a willingness and ability to assess risks and make decisions quickly.
• Give employees a “cut of the pie.” It creates a team spirit, with everyone working toward a common goal.
• Strive to constantly improve your ability to communicate the common vision, goals and culture. The result will be a highly motivated, cohesive team working toward the same goals. That, in turn, leads to high productivity – which should translate to higher profit.
• Make sure everyone in your organization is a contributor. Give them responsibility and the authority to get the job done. Fewer people with more authority increases productivity and enables the company to react more quickly to opportunities. Also, fewer and more productive employees enable the company to pay higher salaries and better benefits.

Additional Pickens quotes that offer lessons for private business owners:

About resigning from Phillips Petroleum at age 26 and “going solo”:

“(While working for Phillips) … I rode a bicycle to work. It brought a few snickers but it was sure easy to park.”

“I was twenty-six years old and on my own. It scared the hell out of me, but I felt as though somebody had taken their boot off my neck.”

“Only a few people were as blunt as my wife’s uncle Pete. ‘Boone,’ he told me soberly, ‘you don’t have a chance. You don’t know anything. How could you? You only worked for Phillips for three years.’”

“I knew the warm-up was over. I needed to make a deal and fast.”

“My back was against the wall. If I could find a good prospect and sell it, I would get some cash and maybe a piece of the action.”

“Money was tight. I had learned to hunt squirrels years before, living in Holdenville. Once, Lynn [his wife] asked if I couldn’t shoot some younger, more tender squirrels.”

“I was a sole proprietor: I had no employees and even did my own typing.”

“I had a prospect that I thought would be an easy sell. I took the deal to a local independent, Walter Caldwell. He would drill two wells … and I would get $2,500 for putting the deal together. Both wells were small gas producers. Caldwell tagged me ‘boy geologist.’”

“I had been on my own for about thirty days. The success of those two wells ended any doubts I might have had about leaving the corporate umbrella. This was what I was born to do.”

“There was plenty left to learn and mistakes would help me. I just had to avoid making the same mistake twice.”

“I tried to distinguish the players from the tire-kickers.”

“At some point, it seems everybody starts to pull for you.”

“The key to making deals was for me to develop ‘drillable’ ideas.”

The Early Years:

“I decided that we had to get into an area that was not picked over if we were going to do any good.”

“… I was also starting to realize that I wanted to do more than scramble through life as a one-man operation. There had to be a better way.

“I had become an independent oilman, which meant a life of difficult decisions, personal risk, and grueling hours. Independence meant you were free to drive a couple of thousand miles a week, eat when you could and try to outsmart leasehounds, big oil companies, the weather and the geology. I thrived on it.”

“It was time for me to redefine my idea of success. I wanted to expand my business and hire someone to help carry the load, to handle some of the details. That was the first step toward what became of my larger dream. To build a real company.”

“… plenty of opportunity if you could get financing, keep your health and hold on to your sanity while juggling a dozen different deals.”

“Feeling the pure joy of work and success – jumping out of bed in the morning charged up to accomplish something in the day ahead – is necessary for an entrepreneur.”

“The reason for my getting the work was price: I was cheap and fast.”

“We were doing whatever it took to survive and we were learning. By the early 1960s, I had enough experience to start doing some interesting things.”

“Undercapitalization afflicts 90 percent of the new businesses in America, and we were all too typical. Every time we got a little cash something would happen and we’d be back at the starting line.”

“When all was said and done, the chances were slim that any one strategy would ever make us a major player. We needed to fish with more lines out.”

When things got really bleak, financially:

“We had our backs to the wall again.”

“‘Boys,’” I said, ‘this is it. We’ve got to figure out a way to make $300 million, and we’ve got to make it fast. A field goal won’t do it – we need a touchdown.’”

“I was used to having my back against the wall. But $300 million was a lot of money – more than half of Mesa’s net worth. You don’t find that kind of money under a rock. We were about to enter a risky game that would make us famous, and in some circle’s infamous, initiating deals involving corporations much larger than Mesa: Gulf, Phillips and Unocal. We would identify the undervalued, mismanaged companies and then make a huge investment in them. We would try to force the managements to do something for their stockholders, including us. And if they refused, we would try to take them over.”

About executives of large public corporations:

“Far too many executives have become more concerned with the ‘four P’s’ – pay, perks, power and prestige – rather than making profits for shareholders.”

“Too often, company managements are more concerned with their own preservation than enhancing their shareholder’s (value). These managements are generally not good risk takers, and their companies suffer from a lack of productivity.”

“If you are a stockholder, the chances are that one way or another, most corporations are misappropriating your money. It is legal under the system. Every day this respectable crime is perpetrated in corporate corridors across the country.”

On his corporate takeovers:

“The corporate world did not lack for poor managements and undervalued companies, so acquisitions would become a key part of our growth strategy.”

“The minnow trying to swallow a whale. But what we lacked in size, we would make up for in creativity and tenacity.”

General:

“Lynn and I decided to get married. Our parents wanted us to wait a few years, but we wouldn’t listen.”

“We rented a house for $60 a month and sublet one room for $40 (breakfast included) to a friend. And that, sports fans, is entrepreneurship.”

“I just don’t think I look at life the same way a lot of people do.”

“Be willing to make decisions. That’s the most important quality in a good leader. Don’t fall victim to what I call the ready-aim-aim-aim-aim syndrome. You must be willing to fire.”

“I’ve always believed that it’s important to show a new look periodically. Predictability can lead to failure.”

“Keep things informal. Talking is the natural way to do business. Writing is great for keeping records and putting down details, but talk generates ideas. Great things come from our luncheon meetings which consist of a sandwich, a cup of soup, and a good idea or two. No martinis.”

“I believe the greatest opportunity lies in a free marketplace. There are powerful forces afoot trying to restrict that freedom in the interests of the vested and already wealthy. I am talking about a relatively small collection of corporate executives who would use the engine of American commerce for their own narrow ends.”

“Play every game for all you’re worth. But when it’s over, it’s over.”

“Asking people for money is the most essential skill for a young dealmaker.”

“… money has frequently been a motivating force in my life. It’s quite a thrill to make money.”

“I believed in good planning, and if I could accomplish as much in ten hours as someone else could in twenty, that really made me happy.”

“It looked like a cinch – and that should have scared the hell out of me.

My experience today would have told me that there are no cinches in this business.”

“I had to adjust my dreams to fit reality – or could I somehow change reality to match my dreams?”

“Entrepreneurs need more capital than banks are willing to lend – to expand, to build new plants or just to get started – and they can find that capital by selling their ideas in the equity markets.”

“I have found that many CEOs could care less about the mechanics of a deal and depend almost totally on their lawyers and investment bankers. They don’t ask questions because they are afraid of looking stupid. I would rather look uninformed at thirty-six, than stupid forever after.”

“I felt that size was meaningless. Results were what mattered.”

“If you are a consistent moneymaker, you will be a good decision-maker. Sometimes the window of opportunity is open only briefly. Waiting isn’t a decision, although many people think it is.”

“The more objective and the less emotionally involved you are, the more successful you tend to be.”

“If I can borrow and get a good return on these funds, it’s more satisfying to me than getting a good return on equity. It’s like a bonus. On the other hand, if you are highly leveraged and lose, your losses are compounded.”

“(I don’t worry so much about the interest rate on borrowed money.) If one half of a percent is going to make a difference, then I shouldn’t be borrowing the money anyway. And I’m always confident that I can make several times what the money costs me.”

“I get concerned, but I don’t get nervous. You can’t make money consistently if you’re uptight. If you don’t watch out, you’ll spend twice as much time on the losers as you do on the winners. You shouldn’t take a risk in the first place if you can’t handle the loss, because you’re not always going to win.”

“I hate losing, but I know that an aggressive investor is going to take some losses.”

“Money is a report card.”

“It seems as if everything I do is geared to saving time.”

Sources:

• Boone. Author, T. Boone Pickens, Jr. Houghton Mifflin Company
• (March 1987)
• 1982 Keynote address to the University of Texas Graduate School of Business Conference, “Small Business and the Entrepreneurial Spirit”
• www.famoustexans.com/boonepickens.htm
• www.brainyquote.com/quotes/authors/t/t_boone_pickens.html
• National Public Radio Broadcast, Morning Edition, January 16, 2006, Interview with T. Boone Pickens
• “Pickens sets record with $165M Oklahoma State Gift,” Associated Press, ESPN.com, Jan. 10, 2006

Fred Rathjen, AmeriSpec

As a construction engineer, he flew all over the country building restaurants for McDonald’s and, later, for Sbarro. But traveling takes its toll, so he began looking for a better way to use his training and talent.

“I decided to go into marketing … and built my own marketing business from scratch,” says Fred Rathjen. “But it didn’t really tap into my passion. I began to, once again, look for other options.”

To be sure and to get it right this time, Rathjen set certain criteria that any new venture would have to meet.

“I had built my marketing business from the ground up,” explains Rathjen. “I didn’t want to do that again. I wanted to buy an existing company and hit the ground running.”

When he found an AmeriSpec home inspection business for sale, it fit his construction background. Because it was already established, it met that criterion. And with his marketing experience, he felt he could make the business a success. He purchased it and, indeed, hit the ground running.

That was more than five years ago. Rathjen now can look back and spot things he did well, and things he’d do differently.

“I changed the culture a little too quickly for some of my employees, so I ended up losing more of them than was necessary,” he says. “I look back and can see I should have taken my time and made a slower transition to what I wanted the business to be.”

Rathjen says he can see that he made one other mistake, too: “About 60% of my business comes from repeat business. I see now I raised prices too soon. I lost clients that would have returned time and again.”

While recognizing his mistakes, he also takes a moment to reflect on the wise choices he made along the way.

“The smartest thing I did was realizing a hidden talent in an employee,” says Rathjen. “I happened to say to one of the ladies who works in my office that I needed to block out more time to consistently market. As it was, I’d market for a while, bring in orders, and then spend my time fulfilling and servicing. I’d drop the marketing, until one day I’d look up and we’d have no new orders. It was a cycle that was ineffective and stressful.”

“She asked what type of marketing was required,” says Rathjen, smiling. “It’s simple. I just drop off brochures at potential clients’ offices and set up appointments to do presentations.”

The employee, who normally did office work, told Rathjen she was willing to visit prospects and set up appointments. So they put together a plan.

“We’re now booked four months out for presentations. She had worked for me for two years before this conversation and she was a diamond in the rough. She’s now vital to our marketing and highly effective,” he says.

Today, Rathjen has four employees and has learned to wear many hats. Although he prefers to do inspections himself, he is now inspector, businessman, human resources director and boss. His business has grown and he rates his success a 7 on a scale of 1 to 10.

“I am very optimistic about the next few years,” says Rathjen. “I have every intention of growing my business and I have the knowledge and experience I need to achieve my goals.”

While Rathjen looks positively toward the future, he shares advice his dad gave him when he was growing up:

“If you keep doing what you are doing, you are going to keep getting what you’re getting.”

That means change, but as Rathjen now says, make those changes slow and steady. Don’t be in such a rush that you lose employees and clients.

Doug Braken: Wiemann Iron Works

In 1940, German immigrant Ernest Wiemann incorporated and opened the doors to Wiemann Ironworks in Tulsa, Oklahoma. Along the way he picked up willing workers and learned the trade of ornamental metalwork.

Now with 15 employees, Wiemann Ironworks manufactures very high-end, meticulously detailed ornamental metalwork in bronze, aluminum and iron. It services clients across the nation. “We have a nice mix of high-end residential, commercial, government and church work. All of our customers want very high-quality ornamental metalwork,” said Doug Bracken, current co-owner.

“I worked for Ernest as a project manager and draftsman,” said Bracken. “When he was ready to retire, I was there. I knew the operations, customers and workforce. Somehow I managed to drag my brother and father into the business and we kept the well-established name.”

It may have been Doug’s brainchild to buy this business, but it has been a family affair. Bracken said the smartest thing he did was to bring his family into the business and utilize their experience. “My brother, David, is my business partner and vice president,” explained Bracken. “He handles the business transactions. My father, Gary, retired from his previous occupation, a pipeline construction engineer and executive, a year after we bought the business. He has shared his wealth of business experience and knowledge with us. My degree is in architecture and I am more comfortable with sales, marketing and design.”

The transition was not easy. “When we purchased the business, Dave and I worked 70 to 80 hours a week,” said Bracken. “Even my wife, Ashley, was down here trying to help sort out things. As the years have passed, we’ve reduced our workweek to a manageable 45-50 hours.”

Wiemann lost many employees after the purchase, in fact, nearly all of them. “We’ve had almost 100 percent turnover in the shop,” said Bracken. “We lost a lot of sleep, but we managed to replace the employees with craftsmen who now provide us with a wider range of capabilities. Once again, a real challenge turned into a blessing,” he continued.

“I firmly believe that a better product can be produced (and more fun had) with a group of motivated employees with average talent than with a group of superstar individuals who don’t work well as a team,” Bracken explained.

With its new team of workers, Wiemann Ironworks has turned out some very special projects. Each job is customized and every day brings a new set of challenges. For example, a client recently called wanting replicas made of ornate, cast bronze doors found in an old New York hotel. The client flew Bracken to New York and, standing in the lobby of the hotel, said, “I want doors just like this for my home theatre.” Bracken says they recently installed the replica doors. “They look great and our team had a lot of fun,” he said.

Bracken likes The Business Owner because it provides a good range of topics about things that affect businesses. He may not get something from every article but he does get something from every issue. Something that helps him in his effort to grow a successful business.

Bracken and his coworkers are well on their way and Bracken says they have turned a good business into a great one. “On a scale of 1 to 10, it’s a 9 now … and we’re heading for 10.”

Doug Bracken is president of The National Ornamental and Miscellaneous Metals Association (NOMMA), which provides a copy of The Business Owner to each member. Mr. Bracken also serves on the board of the Metal Museum in Memphis, TN.

“I went to Penn State Business School for Transportation,” said John Groll. “Upon graduating I worked eight years in the trucking industry as dispatcher, office manager and supervisor. Then, in 1980, the trucking industry was deregulated … and to be honest, it just wasn’t much fun anymore. I left the trucking business in 1982.”

Groll found himself right back where he started at Groll Ornamental. He took the jobs of salesman and installer. “Our main business is to fabricate railings,” explains Groll. “We concentrate mostly on residential railings for new homes.”

Groll says he is best at sales and design. When he was working under his father, he spent all his time selling and designing. Eventually, his father was ready to retire and John became the third generation owner of the family business.

“There’s not much fun in owning the business,” says Groll. “It was a lot more fun when I worked for my dad. When he left, I suddenly had to worry about all of the financial aspects, paperwork, insurance and so on. That part of my job isn’t as much fun for me.”

“I have four employees,” says Groll. “I do the selling and measuring, then I give the specifications to the guys in the shop. When the job is done, I do the installing. I spend about 50 hours a week at work, and then I spend another couple of hours a night going over the books. On average, I work about 60 hours a week.”

In working hard to improve the business, Groll says the smartest thing he has done is purchase equipment that is adaptable to their specialty of custom work. In addition, he feels optimistic about the future of the business.

“As long as the interest rates stay low,” says Groll. “And as long as they keep on building houses, we will continue making railings for them.”

Unfortunately, even though the business is strong, the fourth generation of the family does not seem inclined to want to take over the family business, so, looking ahead several years, Groll is not sure what to do with the family owned business.

“The Business Owner has helped me figure out some financial things,” says Groll. “I’ve learned about taxes, retirement, transferring the business to another or selling it outright. I never really thought about selling the business when I retire, at least not until I read some articles about that.”

But possibly the hardest thing John Groll has learned since taking over the family business is the fact that although he is technically the boss, he has many bosses.

“The employees want to be the boss,” he laughs. “The customers want to be the boss. Everybody wants to tell me how to do it because they all think their way is the best.”

“I came to Ft. Lauderdale in 1960 and started my first taxi business,” says Gaddis. “I started with 10 taxis and for that first 10 years, I worked a minimum of 80 hours a week.”

Today, Gaddis’ company, D & L Service, Inc., operates in Broward County, Florida, with 200 employees and 850 independent drivers.

“We answer, on average, 150,000 phone calls a month,” says Gaddis. “That does not include pickup at the airport, the seaport, the hotels and off the street.”

Gaddis attributes hard work and luck as the key to a flourishing business. He says he has been highly successful over the years, but he also is quick to say he didn’t get there all by himself.

“I attribute my success to being able to attract good people and see that they are well rewarded for their efforts,” explains Gaddis, “I can’t claim that my success is something I’ve done on my own because that is just not true. You have to deal through other people and you have to have people around you that have integrity. That is the most important thing you can have.”

Gaddis also states that one of the smartest things he did over the years was to subscribe to every trade magazine that affects his business.

“I read these trade magazines and I get ideas from them. I get an idea where things are going so I’ll be a little ahead of the curve. If you know what’s going on around you, you can anticipate what is going to happen and so you can get there first.”

The taxi tycoon also says you have to change with the times. Forty years ago, most of his drivers were Anglo-Saxon protestant men but, today, the majority of his drivers are Haitian immigrants. Gaddis sees cab driving as a positive step for these refugees as they strive to make a better life for themselves.

“Cab drivers are a lot smarter than most people give them credit for. They have to learn the city, how to operate a computerized dispatch system, how to deal with the public and be able to drive under various road conditions. This job prepares these people for bigger and better things.”

Gaddis believes in helping others help themselves. One of the learning tools he encourages his independent taxi owners to utilize is The Business Owner’s sage advice.

“The Business Owner gives small business owners information about do’s and don’ts that I probably learned over the years, but, if I’d had The Business Owner around, I probably wouldn’t have made so many mistakes. It does steer the reader in the right direction,” says Gaddis.

As for the future, the cab mogul remains extremely positive.

“If I had life over again, I would choose the taxi business. It is my favorite business and I’m very optimistic about the future. We are in the position to grow because of several things: the price of gasoline; the elderly need transportation; the cost of rental cars; the cost of airport parking; and the laws against drinking and driving. All of these things will keep the taxi industry thriving.”