MEET STEVE JONES, an entrepreneur with an effective playbook for building a service company.
Steve and his long-time buddy, Jeremy DeSpain, co-founded Explore Consulting in February, 2001. The company sprinted out to a good start, working lean and realizing comfortable profits.
“We came out of an era where spending was insane (the dot com era),” Steve remembers. “But we were very conservative.” Good move. So many entrepreneurs get ahead of themselves in spending when businesses start out well. In Steve’s case, he knew that prudence would serve him well in the long run.
By 2003, Fortune 500 companies substantially decreased spending on IT projects, cutting deeply into Explore’s business.
“We made good money the first two years and spent it all the next two years,” Steve says. The ability to stay afloat during tough times is definitely a critical management test for most young companies. Poor cash management takes down many promising startups. Steve and Jeremy understood this and managed accordingly.
At the time, however, Steve wondered if things would ever get better. Not only was the business in trouble, Steve had bought land and was in the process of building a house when the downturn hit.
“It was hell,” Steve reflects. “With two kids and a big brown dog, we were all living in a travel trailer on the property.” He can laugh about it now, but back then the feeling of having “his back to the wall” was overwhelming at times. But the support from his wife, Kelly, and his two girls (Elise, now 8, and Audrey, now 6) strengthened his resolve to make Explore into a bigger success.
Explore continued to keep costs down but still focused on some strategic issues, including a decision to partner with then a little known company called NetSuite. It is a web-based suite of applications with integrated ERP, CRM, eCommerce, and more. “NetSuite gives you a true 360 degree view of your business,“ Steve explains.
The partnership with NetSuite helped fuel Explore’s rebound. Currently, Explore is one of NetSuite’s top 5 partners in the world, and the largest partner here in the Pacific Northwest. Explore’s success also landed Steve a position on Netsuite’s Business Partner Advisory Council.
Inability to make key strategic decisions during difficult times is another common mistake made by struggling entrepreneurs.
Last year, Explore was recognized by the Puget Sound Business Journal as one of the region’s 100 fastest-growing private companies. It was also recently named as one of the nation’s fastest-growing private companies on the Inc. 5000 list.
So, what’s the next for Explore? Well, Steve and Jeremy struggled with whether it was time to relinquish some control by bringing on a more seasoned executive. For many entrepreneurs, this is the most difficult hurdle: Giving up control.
Steve and Jeremy, however, hired Kendall Kunz, former CEO of ARIS, to be the company’s top executive last month. While Steve admits giving up his CEO title “hurt” a little, he is convinced the decision gives the company the best chance to hit higher levels of success. Steve now serves as the Chief Technology Officer (CTO).
“This move is very strategic and exciting for our organization,” says Steve. “Having Kendall on board will help us deliver on our expansion goals while enabling me to focus on growing and diversifying our service offerings including building out vertical solutions and meeting the international market opportunity.”
Interestingly, Steve’s first job after graduating from Montana Tech was with ARIS, where Kendall was at the time the Senior Vice President of Sales, later to become the CEO of the public company. Steve and Jeremy both went through ARIS bootcamps in 1995 and 1996 respectively, with Jeremy coming from the University of Washington.
“A lot of what we learned was a template from ARIS,” Steve shares. Now, they’ve hired back one of their first mentors.
For me, I remember Steve as a young, bright, enthusiastic new recruit at ARIS. More importantly, I remember that he played wide receiver in college and was really fast. We had a flag football team at ARIS at the time, and he was a secret weapon in our perfect season (2-0). This is definitely a guy you want on your team – in business too.