Scott Everett – Co-Founder & Managing Partner, S2 Capital

Scott Everett started his real estate career in 2007, after receiving his broker’s license. He formed Royal Ventures, LLC in 2008 to provide brokerage, asset management, and development services for multifamily and commercial investors. In 2012, he founded S2 Capital to acquire and redevelop multifamily real estate with his partner, Skip Bird. In the past five years as co-founder and managing partner of S2 Capital, they have built a real estate investment company that has acquired over $900 million of multifamily assets and three operating companies that generate annual revenues in excess of $75 million, with over 150 employees. Scott is also an active investor and board member for multiple early-stage companies and enjoys being involved in the growth of early-stage ventures. Scott also contributes significant time and resources to Jonathan’s Place, a local emergency shelter for at-risk children. Scott is married with three children and lives in Plano, Texas.

Tell me about your early career.
I have always had an obsession with entrepreneurs, business, and money. While in high school, I started multiple online companies, from a nightclub website to building gaming computers that I sold on eBay, all of which taught me valuable lessons in business, but ultimately failed or weren’t profitable enough. While reading a Forbes article about Blackstone and Steve Schwarzman about a pending IPO in detention during my senior year, I became obsessed with private equity and the business model of buying distressed companies and other assets. I set out to learn as much as I could through books and online classes, and ultimately realized I wasn’t smart enough for hedge funds and private equity, so I settled on real estate! The year I graduated from high school, I went out to raise a $100,000 fund to buy and flip single family homes. In the Fall of 2007, it was becoming clear a financial crisis was pending and I had no luck attracting capital or good deals. I had the benefit of seeing how bad markets can get and was up every morning at 5:00 AM to watch CNBC and learn from the failures, all while raising a family. My girlfriend (now wife) at the time was pregnant in high school at eighteen years old. In 2009, I decided to drop out of college and start a full-time commercial real estate company while I waited tables at night for a Mexican restaurant. It took eighteen months of failures before I finally put a deal together that had merit. I had sourced an off-market opportunity at a historically low price and also found a capable equity group to partner with me out of New York. We contracted, went through due diligence, and I had negotiated a 3% acquisition fee and 20% ownership after we closed the deal. That fee would’ve been $150,000 to me at closing and would’ve changed my life and validated the decision to drop out of school to become an “entrepreneur.” After four weeks of due diligence, we scheduled a call to review everything with the seller and out of left field, my partner, who had all the control and power, stated they needed a price reduction of $500,000 or they would drop the deal. The seller immediately responded they would give nothing, so my partner terminated the contract on the call and ignored my phone call, thereafter. It felt like my world had collapsed in thirty seconds! My heart was in my feet, as I vividly remember putting my server uniform on that night to go wait tables and felt like crying. I spent the next few days panicking and trying to revive the deal, but both parties ignored me. By the end of the week I remember telling myself, “Move forward and make this the story you tell about never quitting when you are successful one day.” The search started over for new deals and a new partner. It took another twelve months before I sourced both once again, spent six months of my life thereafter, only to have another deal fall apart at the finish line. It was crushing and truly made me re-evaluate everything I was doing and every decision I had made to that point in my life. I was now twenty-three years old, watching friends graduate college and get good jobs, while I raised my 4-year-old son with his mom I couldn’t yet afford to marry, lived at home with my parents, and was still waiting tables. I decided I’d come too far, and with every failure, I had learned very valuable lessons, made great contacts in the industry, and was picking up momentum, but not quite yet making money. In 2012, at twenty-three years old, I started S2 Capital with my partner Skip Bird, who had thirty years of real estate experience, but like me, had a few setbacks over the past year. We were both starting from scratch and determined to make it happen. We made a great team, since he had the experience and equity contacts, while I had built a network of deal contacts and underwriting knowledge, and was willing to commit sweat equity pursuing deals. In October 2012, we finally closed our first deal for an acquisition of $6 million and 184 units, and nearly lost our ass since we had no idea what we we were doing. I was onsite 10 hours a day managing the project and learning from the ground-up, trying to save the project as well as our infant company. Five years later, we built a company with over 150 employees, reached #14 on the “Inc. 500” list, reached #1 for the fastest-growing real estate company in the U.S. in 2016, and #1 fastest-growing company in Texas. We have built a portfolio approaching $1 billion in value, totaling over 12,000 units, and it’s been the most exciting times of my life. I owe so much to the people that supported me for the first five years while I failed many times, and the last five years as they’ve guided and supported me through our growth. I would need a full book just to thank my wife who believed in me and supported me through all the tough times, and who I now have three wonderful children with, and to all my family, mentors, partners, and friends who have guided me through all the success we’ve enjoyed today.

How did the concept for S2 Capital come about?
I had initially been working on multifamily development projects and was frustrated with the amount of time it took before you could make any money and reap the rewards of your risk and work. I had read about a company called Knightvest and Conti and their growth back in 2011 and decided to shift gears into multifamily acquisition/rehab-based on the metrics they were describing. It was the best decision I ever made.

How did you initially fund the business?
We had to borrow a lot of money in the beginning and I aligned myself with a wealthy entrepreneur who received a large stake in our first few deals for putting up the capital and signing on the loan guarantees, since me and my partner’s balance sheets weren’t big enough. I always tell people to worry about putting together good deals first, because if it’s good enough, you will attract the capital.

How did you come up with the name S2 Capital?
My partners name is Skip, so Skip and Scott became S2.

How was the first year in business?
We almost blew up our first deal. I spent 12 hours a day onsite firing, hiring, and firing again until I finally pushed everything across the finish line. It was very touch and go the first year before we really figured out what we were doing. The market definitely bailed us out and was a huge lesson for what not to do, which if you can survive, are the best types of lessons.

What were some of the challenges you initially faced?
For me, it was competing in an ultra-competitive environment against a lot of people with a lot of money. We had to be very creative in how we found and structured our deals in the beginning, and once acquired, we had to be the best operating partner in our market to continue to attract equity and debt. After the first four to five deals, we had finally built a brand known for executing and doing what we say we are going to do, which goes a long way in business.

Did you have a lot of competition?
It’s highly competitive. After five years, and being the fastest-growing real estate company in the nation for the 2012 to 2016 period, we are finally large enough and well-capitalized to compete with anyone in the business. For the first two to three years, we were always the bridesmaid, at best, and final competitions or in the broker network for new deals, equity, and debt.

What was your marketing strategy?
As a company, we chose to fly under the radar. Sometimes, it’s best not to draw attention to yourself, especially in the commercial real estate business. We launched a year of public relations just to boost our brand, mainly to assist us in attracting top talent, but you don’t want to be negotiating deals and have the other side of the table feel they are getting screwed because of an article they read about how great you are doing.

What was an average workweek like for you back then?
The first few years was definitely 12 to 14 hours a day. As I have scaled the company to over 150 employees, it’s actually freed up my time to do other things that I love, like spend time with my family, work out, travel, and play golf. I still work 60 to 70 hours a week, but it’s not non-stop anymore.

Were you profitable by the end of year one?
No. It took eighteen months before we finally started to see some net income. But the next forty-eight months after that blew away our wildest dreams in terms of cash flow, asset values, and net income.

How fast did the company grow during the first couple of years?
It was very slow the first two years. We acquired 400 units the first twenty-four months, totaling $8 million in portfolio value. Over the next 36 months, we acquired another 11,000 units, totaling over $1 billion in portfolio value. After the end of year two, we had three employees, and by year five, it was 150. It’s been a lot of crazy fun.

If so, what do you think caused that high spike in growth?
It was mainly building our foundation and attracting capital. That takes the longest in the beginning, but if you focus on it daily and plan for it, you can look up and be astonished at how fast things can take off. It never really hit me how fast we were growing until years later. I was always chasing the company ahead of us, even though they were leading the nation in real estate growth prior to us. You have to stay focused, motivated, and not get caught up in your own success. Just keep your head down and work as if every day the company could fail, because in your infancy, it really is that fragile.

Did you ever feel you had to sacrifice a lot of personal time for the business?
Absolutely. In the first four years before S2 Capital, I made no money and spent my days working on my first real estate company, while bartending and waiting tables at night. My son was four years old before S2 started and I pretty much only got to see him on weekend mornings and afternoons for the first six years of his life. Today, I have three kids and, for the most part, I’m fortunate enough to be home for dinner most nights, put them to bed, and spend time with them on the weekends.

Fast-forward to today. How fast is the business growing?
2017 has been our best year on all fronts, from operations, asset management, acquisitions, to dispositions. We’ve done more in the first five months of 2017 than all of 2016, and we’re excited to see what the second half of the year brings us. It also is our first time expanding outside of Texas markets and into Florida, which I am very excited about.

How do you organize your day?
I start with highest priorities and try to knock those out as early as possible. For our business, deals can die within an hour and you can lose thousands, if not millions of dollars. After I’ve put out fires, I usually spend a few hours a day in meetings but try to avoid “meeting for the sake of meeting,” and I almost never let a meeting run longer for more than one hour. Towards the end of the day, I will check on our operational performance for the day and work my way through emails. I always try to get some sort of response out to every email by end of day, even if it’s just a, “Thanks, will send tomorrow.”

What are some of your daily habits that have contributed to your success?
I keep a pretty strict schedule. I am usually up at 5:30 AM. I go to the gym in the morning, read Bloomberg and the WSJ, as well as some local news publications to make sure I am aware of key items in the markets, and then arrive at the office around 7:00 AM/7:30 AM. I believe having a pretty consistent schedule allows you to not miss things or get behind. I also am a huge believer in working out in the morning, as it really helps get the brain going, and is a big mood booster. It’s also a great stress reliever for a busy and mentally-tired entrepreneur.

What are some quotes that you live by?
“Complaining isn’t a strategy” is a favorite of mine. It’s posted in our office kitchen.

What are some of your favorite books?
I read a ton, and attribute a lot of my early success to reading. I would spend hours at Barnes and Noble reading entire books because I couldn’t afford to buy them. The Peebles Principles: Tales and Tactics from an Entrepreneur’s Life of Winning Deals, Succeeding in Business, and Creating a Fortune from Scratch is a favorite of mine. King of Capital: The Remarkable Rise, Fall, and Rise Again of Steve Schwarzman and Blackstone, Rich Dad Poor Dad: What The Rich Teach Their Kids About Money That the Poor and Middle Class Do Not!, Raising The Bar: The Life and Work of Gerald D. HinesThe Real Estate Entrepreneur: Everything You Need to Know to Grow Your Own Brokerage, Gerald Hines’ biography, and The Education of an American Dreamer: How a Son of Greek Immigrants Learned His Way from a Nebraska Diner to Washington, Wall Street, and Beyond by Peter G. Peterson. I have an obsession with studying successful people who have accomplished what I hope to accomplish.

How do you define success?
I think living with a purpose and happily is success. That purpose may include being an excellent mother to three children or running a charity for starving children in third-world countries. Money will not bring happiness, but if you love what you do and see money as a means of supporting your purpose, it can be very fulfilling. I am a big believer in giving back to your community, family, and loved ones. You didn’t get here all by yourself. That I am sure of.

What is the key to success?
Perseverance is the most important quality. No matter the endeavor, you can’t be an excuse maker, and you just can’t quit. You can pivot, adapt, change your strategy, and even fail, but you can never quit.

Did you always know you would be successful?
I always felt deep down I would be successful. For me, success was building a great company and a great life for my family. I always had set a goal of being a millionaire by age thirty, and got there at twenty-five. The number becomes a way for me to keep score of how successful I have been at building a great company, so I continue to set it higher, and stay focused and motivated.

When faced with adversity, what pushes you to keep moving forward?
Failure was never an option in my mind. It may have taken five years, ten years, twenty years, but I was going to get where I wanted to go. My family deserves it, and it would be a waste of my immense blessings to just settle. I was born to great parents, in America, and had access to a good education. I was already ahead of 98% of children in the world. I had no reason to not give it my all and achieve whatever it was I wanted.

What is the greatest lesson you’ve ever learned?
Money truly doesn’t buy happiness. When I was eighteen, I always thought how cool it would be to have fast cars and big houses, but I ultimately learned life is all about the relationships you form – romantic, friendship, or family. It took me a while to figure that out, but once I did, life and work are much more enjoyable.

What do you enjoy doing in your spare time?
I have three kids, so they take up most of my free time. Otherwise, I enjoy golfing and hanging out with friends and family. I am a big foodie, so we are always going out to dinner.

What makes a great leader?
I think calmness under pressure is critical. Nothing ruins a company faster than an emotional leader who feels the need to bully and tear down employees. We are here to build people up and absorb the pressures of running a company, not exert our fear and lack of confidence on everyone around you.

What is your vision for the future of S2 Capital?
I want to continue doing what we are doing and look up in another five years and be amazed at all that we’ve accomplished. I’ve never set hard and fast goals for us. We stick to what we’re good at, guard our culture, hire good people, and try to have a lot of fun while we’re working. If you keep your head down and focus on those things, you will be amazed at what your team can accomplish.

What do you think is the most common mistake entrepreneurs make?
Failing to relinquish control and delegate. I see it all the time and it is the biggest impediment to any company. You have to empower your people, align everyones’ interests, and get out of their way.

What advice would you give to young entrepreneurs?
Dream big and never quit. Life doesn’t owe you anything. It’s up to you to make it happen, and when it’s not going right, don’t stop to complain and make excuses for why you failed. Move on and keep telling yourself its going to happen. Also, “Speak softly and carry a big stick.” There is nothing worse than hearing people brag about how great their company is going to be or how much money they will make when they get going. No one cares. Just make it happen, and the results will speak for themselves.

Rich Mavrogeanes – Founder, President & CEO, Discover Video

Rich Mavrogeanes has been a leader in the communication technology industry for more than forty years. Prior to starting Discover Video, Rich was the founder of VBrick Systems, Inc., where he served for twelve years as President and CEO, and later as Chief Technology Officer. He led VBrick from a start-up to a market leader. He was also founding executive at SNT and Avidia.

With modern technology for the education, corporate, government, and related spaces, Rich founded Discover Video in 2008 where he drives innovation and growth as President and CEO.

Tell me about your early career.
After serving my country in the Air Force in Europe, I stayed in Europe for a while and took various jobs in Germany, including as a bus driver and in radio repair. I decided to make a film and left for East Africa, where I stayed for many months in Kenya, Uganda, and Tanzania, mostly living out of my Land Rover. These are my young adventure days. Returning to the U.S., I got a job in my hometown as an electronics technician at a medium-sized company that sold to the Department of Defense. I had thought this would be for maybe six months, some time to make enough money and move on. I ended up working there for fifteen years.

During this time, I had almost every job that one could want: technician, design engineer, quality control manager, supervisor, customer service manager, salesman, and director of my own internal business. I became an “intrepreneur,” and learned about accounting and running a business. I traveled the world for the U.S. government, had an office in the Pentagon, and carried the highest security clearance. When that company changed and merged, I left and worked for a large telecom equipment company as director of product marketing. Again, I traveled the world and helped the company evolve from traditional, phone data technology to the new world of packet switching, ATM, and IP.

This was during the “dot-com bubble” days, and VCs were dropping bags of money into my type of tech, so I left and joined my first startup. We were making ATM switches, which if you believed the tech headlines, was going to cure for cancer and could win the war. Within a year, we were featured on the cover of the top tech magazines, so things were going well. But then I sensed ATM was losing its luster and we pivoted to build “DSL Mux” (which was based on the same technology) and partnered with PairGain Technologies. A few months later, we sold the company to them for $95 million, right at the tail of the bubble. Our investors did well, and the other guys did quite well too. I was not sophisticated enough to know any better and did not become wealthy, but I learned a lot for next time.

Next I joined another start-up, this time in Minnesota. Again, doing ATM technology but with a different spin. I formed a partnership with Microsoft, who had a new system called “Netshow Theater Server”, which delivered video on demand, but required a good network and ATM was the way to go. Spending a lot of time in Redmond, Washington, I saw how the market for such video systems could grow, but was lacking a means to deliver live video over the network. This was an important insight. The Minnesota company was sold to a large telecommunications firm that really just bought the engineers, so no one did well.

In late 1997, I started my own company called VBrick Systems. My experience allowed me to operate, as we were building both hardware and software. Initially funded by me, then scraping up money from suppliers and trading equity for services, we raised enough to hire a few people, working from my own home. You can imagine the stories!

We sold our first VBrick to Sprint in 1998. Then we raised our first $4 million venture round and we were off to a growth path. Another round a year or so later added $7 million to the war chest. By 2000, we had sales of over $5 million and were growing fast. The VCs turned out to be dysfunctional and insisted on unnatural acts. One even insisted on interviewing our engineers and wanted to fire some people based on their fingernails, which was crazy and stressful.

We hired a CEO to help me out, who became a life-long friend. Together, we raised another $21 million in another VC round, and brought in Morgan Stanley and other professional investors. This was hard because we closed the round in March 2002, during the “9/11 freeze.”

The VBrick board was still dysfunctional and consisted of money managers with no vision or interest in what we did. While we were growing at around 50%, they wanted more than 100% growth, and purged the CEO and brought in a “friend” of one of the investors. He turned out to be a disaster and revenue fell, people left, and I was watching my baby die. There was nothing I could do about it. Eventually, I left and they hired another overpaid friend of an investor as CEO. That did not work well either, and I was watching from the sidelines as they fired everyone with intuitional memory or experience, and the revenue fell to half of its peak. Eventually, another CEO was hired, and then another. While I’m still a major shareholder and wish they would do well, they were not heading in the right direction.

So I started Discover Video after my non-compete expired. With no VCs, Discover Video is able to do sensible things and keep focused on delivering the best visual communications platform for enterprises in the market. While it is more challenging to drive a business organically, we’ve managed to become one of the “fastest-growing companies” in the U.S., according to Inc. Magazine.

How did the concept for Discover Video come about?
The concept came from a confluence of technology, market knowledge, and experience. The competition did not really offer a complete video ecosystem, so we set out to remedy that. Underserved market segments in higher education, K-12, and corporate represents an opportunity.

How was the first year in business?
During the first year, we were restricted in the markets we could serve based on my non-compete agreement. So we served one market segment heavily and were profitable from the start.

What was your marketing strategy?
Leverage the name-brand of the founders, be 50% better and 50% cheaper, sell through channels and provide superior discounts.

How fast did the company grow during the first few years?
800%.

How do you define success?
Success is making a living by doing what you enjoy.

What is the key to success?
Make your customer a hero.

What is the greatest lesson you’ve ever learned?
When you buy a mutual fund, you probably have no idea what companies that mutual fund manager invests in, right? You only want money, and you are okay with that. Same with VCs or most investors. It’s normal. As Yogi Berra said, “It’s tough to make predictions, especially the future.”

What are some of your favorite books?
For nonfiction, I like reading Malcom Gladwell, Geoffrey More, and Fareed Zakaria’s books. I also like to read science fiction.

Tell me about one of the toughest days you’ve had as an entrepreneur.
Standing on the Interop Tradeshow floor in Atlanta, Georgia on Sept 11, 2001 at 9:00am and watching the world change in a few seconds. I had planned a major product launch, press briefings, etc. Also, knowing that we may not be able to pay the bills if we could not grow.

When faced with adversity, what pushes you to keep moving forward
Knowing that we all end up in the same place. Life is a journey, and it is overcoming obstacles that gives one joy.

What advice would you give to young entrepreneurs?
1) Don’t do it for the money. That’s only how we keep score.
2) Be kind to everyone. You never know who you will need in the future.
3) Karma is real.
4) Be sure there’s a market for your product. Everything else can be fixed.
5) The “Internet” is not the only thing. Mobile apps are not the only thing.
6) Plan for what you will be doing in ten years.
7) Hire sales professionals. Although this can be expensive, having a business without sales is not a business.

Jason Cardiff – Founder, President & CEO, Redwood Scientific Technologies, Inc.

Jason Cardiff started his career in sales management at Mercedes Benz USA. After leaving the automotive business, he founded First Choice Media, a private consulting company that provided marketing services for national non-profit organizations, while simultaneously finding success with his own national, infomercial businesses and products. As the founder of Redwood Scientific Technologies, Inc., Jason provides the leadership and vision for the success of the company. He is not only responsible for product development, but also for negotiating with business partners, from merchant banks to retail business executives and prospective investors. More importantly, Jason is responsible for constituting and executing the strategies for Redwood to compete effectively in the marketplace and ensure long-term profitability and sustainability of its brand. With his background in sales and marketing, Jason oversees all advertising efforts of the company, from planning to directing infomercials. Jason has successfully launched several products nationwide. Under his leadership, Redwood has experienced 650% compounded growth during its first four years in business. Jason has three small children – ages three, eleven and thirteen – and enjoys spending his free time engaged in outdoor activities with his wife and children.

Tell me about your early career.
My early career started with my first company being on the servicing side of products for sale in the “As Seen on TV” space. I built the company into a worldwide presence with offices and staff spanning four countries. I quickly realized that if I am going to do all the work, then I should start launching and making my own products.

How did the concept for Redwood Scientific Technologies come about?
The idea was, “How do we make a better version of the pill?” I like experience-based products that can do something people have always done, but in a better way. It seemed like the timing was right to create a new and better delivery method for over-the-counter (OTC) drugs.

How was the first year in business?
Our first year in business was a very exciting time. We went from concept to market with our first OTC, thin film product and, like all things, we waited to see what the market reaction would be to the idea of a thin film mouth strip as a delivery mechanism. We then started to prove our model and numbers.

What was your marketing strategy?
My go-to-market strategy is very simple. First, we look for a product that can be used by more than 25% of the adult population. Then, we bring that product to market with national television and a very compelling story that we develop through solution marketing. And with a little luck, we have a go-to-market and national roll-out.

How fast did the company grow during the first few years?
As a company, our growth was very explosive over the first few years. However, growth is not always good, unless it’s healthy growth.

How do you define success?
Success is defined when you have a vision for what you want to achieve, and you execute your vision into reality. At Redwood, we back up our vision with our core values, and when that is achieved, then we’re successful.

What is the key to success?
Have a plan. Stick to the plan, and always, always, always finish what you start.

What is the greatest lesson you’ve ever learned?
The greatest lesson I’ve ever learned, that most entrepreneurs never learn, is that things only happen if people want them to happen. For example, if someone is not calling you back, or if a buyer is not buying what you are selling, it is simply because they don’t want to. They would if they want to.

What are some of your favorite books?
For business, I love Good to Great: Why Some Companies Make the Leap and Others Don’t by Jim Collins for running a company. I also love Traction: Get a Grip on Your Business by Gino Wickman, and for fun, I love to read Stuart Woods.

Tell me about one of the toughest days you’ve had as an entrepreneur.
The toughest day I have had as an entrepreneur would be the day that I learned it was just me, standing alone, either making it or not.

When faced with adversity, what pushes you to keep moving forward?
When times get tough, and we all have those days, I stay focused on the vision of what we are working towards, and press on.

What advice would you give to young entrepreneurs?
Keep looking forward! The past is over. Yesterday is gone. Stay focused on the goal.

Shay Houser – Co-Founder & CEO, Green Cloud Technologies

Shay Houser is an experienced entrepreneur, having co-founded four companies: Seruus Ventures (1995; active venture fund), Nuvox Communications (1997; acquired by Windstream in 2010), UCI Communications (2003; acquired by Black Box in 2008), and Green Cloud Technologies (2011). His focus has always been on telecom and technology services organizations that focus on the SME space with a core expertise around channel program development. Mr. Houser has significant experience searching, negotiating, and closing acquisitions and he has led approximately thirty financing and M&A transactions, securing hundreds of millions of dollars in debt and equity, and filed for an IPO at Nuvox in 2000. Mr. Houser’s core strength revolves around building third-party distribution channels, capital formation, and mergers and acquisitions. He received his B.A. from The Citadel, The Military College of South Carolina.

Tell me about your background.
I grew up in Greenville, South Carolina, attended public high school, struggled academically, probably due to ADHD or mild dyslexia, but I didn’t deal with any of those issues. I was a trouble-maker/problem child so I needed structure for college, making The Citadel the only real choice for me. My parents were wonderful and my dad was the CEO of a high-growth telecommunications firm when I was in high school. I worked there on and off. I also worked at a local, country club golf course. I bought my first stock, Apple Computer, while I was in seventh grade (1982).

What did your parents do?
My mother was a homemaker and my father moved from building materials sales into telecommunications in 1982. It was a lucky break for the family. Both parents came from very humble beginnings. My mother, who passed in 2014 from ovarian cancer, grew up in Yazoo City, Mississippi and my dad grew up in Magnolia Springs, Alabama. My father was one of five children and grew up in a two-bedroom house. My mother had two sisters and was also raised in a small house, and her father worked in the oil fields of Mississippi.

Tell me about your early career?
I started my first company, Carolina Graphics and Print, during my junior year of college. It got me fired up about being an entrepreneur. When I graduated from The Citadel, I went to work for Corporate Telemanagement Group, which was an employee-owned company where I worked in various positions culminating a carrier sales and corporate development role. I was fortunate enough to have an opportunity to buy stock in the company at an early time (and age) and got extremely lucky when the company sold five years later for $160 million. I was in the right place at the right time.

How did the concept for Green Cloud Technologies come about?
The other co-founders, Keith Coker, Eric Hester, and Charles Houser, as well as myself, worked together at our previous business, Nuvox Communications. It was simply a matter of time before we did something together again. Eventually, timing worked out for all of us and we decided to pull the trigger and start Green Cloud. We knew that we wanted to sell a recurring revenue-based service through third-party marketing channel partners, with a focus on small- to medium-sized businesses.

What were some of the challenges you initially faced?
Green Cloud, and entering the cloud computing industry, in general, is very capital-intensive, so raising capital was critical to ensure we could build out our data centers to provide services. Also, our business is based entirely around recurring revenue-based services, rather than equipment or projects revenues. Recurring revenues take a long, long time to achieve scale and inflection points so there is no fast way to get to scale. It must come through hard work and years of focus.

Did you have a lot of competition?
We are in a highly-competitive business and compete with the giants:  Amazon (AWS), Microsoft, and Google. However, like most industries, there are niche providers, which is where we fall. Fortunately, since cloud computing is a $100+ billion industry, many niche players can grow into billion-dollar businesses. The market is so massive that hundreds of providers can succeed.

What was your marketing strategy?
We sell our services exclusively through a channel network. We have no direct sales force. Our channel partners currently consist of 500 local or regional IT services organizations across 46 states.

How fast is the business growing?
Our growth rate from 2012 to 2016 was 6,600%.

How do you organize your day?
I start my day around 5:15am. I spend forty-five minutes reading industry, financial news, commit meditation and prayer, and then hit the gym for an hour around 6:00am. I like to see the kids before they leave for school and then we leave around 7:45am, them for school and me for the office.

What are some of your daily habits that have contributed to your success?
Getting up early and not getting behind are my keys to staying ahead. I also enjoy frequent breaks during the day, just for five to ten minutes, to step back and relax for a few moments to maintain the stress levels. Living within my routine, which includes being in bed by 9:15pm, is extremely important.

What are some quotes that you live by?
“Don’t give up. Don’t ever give up.” “A good plan violently executed right now is far better than a perfect plan executed next week.” “One day at a time.” “Visualize your success.” “There is no better than adversity, every defeat, every heartbreak, every loss, contains its own seed, its own lesson on how to improve your performance the next time.” “Tough times never last, but tough people do.” “The Lord is my shepherd, I shall not want.”

What are some of your favorite books?
Start with Why: How Great Leaders Inspire Everyone to Take Action by Simon Sinek, Man’s Search for Meaning by Viktor E. Frankl, Endurance: Shackleton’s Incredible Voyage by Alfred Lansing, Auschwitz: A Doctor’s Eyewitness Account by Miklos Nyiszli, The Noticer: Sometimes, all a person needs is a little perspective by Andy Andrews, The Big Short: Inside the Doomsday Machine by Michael Lewis, The Fish That Ate the Whale: The Life and Times of America’s Banana King by Rich Cohen, The Generals by W.E.B. Griffin, Rebel Yell: The Violence, Passion, and Redemption of Stonewall Jackson by S. C. Gwynne, The Path Between the Seas: The Creation of the Panama Canal, 1870-1914 by David McCullough, The River of Doubt: Theodore Roosevelt’s Darkest Journey by Candice Millard, The Prize: The Epic Quest for Oil, Money & Power by Daniel Yergin, Destiny of the Republic: A Tale of Madness, Medicine and the Murder of a President by Candice Millard, Island of Saints: A Story of the One Principle That Frees the Human Spirit by Andy Andrews, Unbroken: A World War II Story of Survival, Resilience, and Redemption by Laura Hillenbrand, Sea of Glory: America’s Voyage of Discovery, The U.S. Exploring Expedition, 1838-1842 by Nathaniel Philbrick, and Alcoholics Anonymous: The Big Book by Anonymous.

How do you define success?
Maintaining balance, peace, and happiness, one day at a time.

What is the key to success?
Following your gut while being practical, surrounding yourself with great people, doing what’s right, and rewarding those who do the hard work.

Did you always know you would be successful?
I’ve had many moments of great fear of failure but I’ve always known, deep down, that I was destined to create value, momentum, and success.

When faced with adversity, what pushes you to keep moving forward?
My family, faith, and a burning desire to never quit. I believe a core responsibility of every American is to honor the men and women before us (and who protect us every day) by doing our share to honor them. We do that by busting our ass to make America great.

What is the greatest lesson you’ve ever learned?
You reap what you sow.

Tell me about one of the toughest days you’ve had as an entrepreneur.
Undoubtedly, at a board meeting during the spring of 2002, after going through the dot-com meltdown as the CEO of a high-flying Internet company, our board, which consisted of the largest investment banks on Wall Street, recapitalized our company and effectively wiped out all of my net worth. I lost tens of millions of dollars in the blink of an eye. It was both the best and worst professional event I’ve ever experienced.

How did you overcome the challenges at hand?
Honestly, I handled it terribly. I quit the company I had created and then lived in denial of what happened for over a year. It took a soul-searching inventory to bounce back, while taking years to recreate another technology company that I could successfully sell in 2008.

What is your vision for the future of Green Cloud?
Green Cloud is going to continue to rapidly transform the cloud infrastructure market, create value for our shareholders, and create a working environment in which all Green Cloud employees (who are also owners, as we are employee-owned) can use their God-given talents to prosper. We will make a generational impact for the families of our co-workers.

What advice would you give to young entrepreneurs?
Go for it. Find your calling and go after it with both barrels blazing. The money will come and, eventually, you’ll find that the money doesn’t matter and, at that time, you will have discovered true success.

Michael Parnell – Founder & Principal, MP Consulting Services, LLC

Michael has over fifteen years of experience in the construction management industry, serving as Senior Project Manager for several of the nation’s largest builders, including Skanska and Hunter Roberts Construction Group. He has been responsible for the overall success of projects in excess of $162 million in contract value, most notably Red Bull Arena in Harrison, New Jersey ($162 million) and the Conrad Hotel in Battery Park, Manhattan ($120 million). Throughout his career, Michael has successfully completed over $564 million of residential and commercial projects to date.

Since founding MP Consulting Services, LLC in April 2012, Michael has led the company through tremendous growth and was honored to be ranked #57 on the 2016 “Inc. 5000” list of “America’s Fastest Growing Private Companies”. Michael is a graduate of East Carolina University with a B.S. in Construction Management and has served as an adjunct professor at NYU’s Schack Institute of Real Estate. He resides in Monmouth County, New Jersey with his wife Erin, son Nolan and daughter Ryan.

Tell me about your background.
I primarily grew up in a single-parent household, with my mother and younger sister. I lived in New Jersey from birth through second grade, New Hampshire from second through eighth grade, then back to New Jersey for all of high school. I never knew my biological father, and my stepfather was never around much. My mother and stepfather separated when I was eleven and divorced by thirteen.

What did your parents do?
After they divorced, my mother went back to school to become a nurse. After eighth grade, we moved from New Hampshire to Point Pleasant Beach, New Jersey, to be closer to my mother’s side of the family. My mother was in school part-time and working part-time, from when I was in ninth grade through senior year of high school. We lived with my grandmother in Brick, New Jersey during the summertime, and lived in “winter rentals” in Point Pleasant Beach from September to June each year during high school so we could go to school in the Point Beach school district. There was a lot of moving in my life, twice a year throughout high school alone. I played soccer and wrestled during all four years of high school, and was captain of our soccer team in junior and senior years. Sports was my outlet, growing up. Whenever I was on a team, I was focused. During the off-seasons, I would slack off and get into trouble.

Tell me about your early career.
I graduated from East Carolina University in Spring 2002 with a Bachelor of Science in Construction Management, moved back to New Jersey, and started working for The Henderson Corp. within weeks of graduation. My larger projects with Henderson Corp. were for GlaxoSmithKline, which was a new office building and research labs, and then a seven-story building dormitory complex at Princeton University. While at Princeton, I was recruited by Skanska, where I helped build the Frank Gehry-designed Lewis Library, also at Princeton University. After two years with Skanska, my boss had moved on to Hunter Roberts Construction Group, and recruited me to join his team. While at Hunter Roberts, I had the privilege of being chosen by the founder, chairman and CEO, Bob Fee, to be his mentee, which was a career and life-changing opportunity for me. Bob is a legend in the New York/New Jersey building market, having formerly been the president and CEO of Turner Construction before retiring and founding Hunter Roberts. Bob and I had a two-year, formal mentorship, meeting for breakfast once a month for a couple of hours each time. In those mentorship meetings, he exposed me to the full breadth of how a large-scale construction company operates, every inch of the business. He also enrolled me in a tremendous amount of offsite training programs run by FMI, an industry-leading management consulting firm where Bob himself had received executive coaching. But the most important outcome of our mentorship meetings was the confidence that Bob instilled in me, and a belief he built in me that I could achieve far more than I had thought I may achieve up to that point in my life. We set goals for the next several years of my career, and Bob believed that by 34-35 years old, I should be aiming to be the General Manager (GM) for one of the Hunter Roberts’ business units (the lead in one of our regional offices). At the time of setting this goal with me, I was a 28-year-old project manager, so to say this was a “stretch goal” at the time is an understatement. But Bob believed in me, and eventually I believed in myself that it was an attainable goal, and we set a plan in place to achieve it. I then moved on to be Senior Project Manager on the $162 million Red Bull Arena (MLS soccer stadium), and the $120 million Conrad NY Hotel in Battery Park, Manhattan. Managing these large scale projects was a lot like being GM of a business unit, with the amount of volume we were putting in place each month, which was preparing me just as we had planned. By 2012, although I was no longer working for Hunter Roberts, and Bob had since retired, I founded MP Consulting Services three weeks before my 34th birthday. My old mentor was right, all along.

How did the concept for MP Consulting Services come about?
The majority of the projects I worked on throughout my career have been “GMP” contracts (guaranteed maximum price), where the GC and client have an open book contract arrangement. The clients see the full details of the project estimate, and the result is a team-like atmosphere, where everyone works together to build a successful project with each partner’s best interest in mind. In contrast, there is the “lump sum” contract arrangement, where a client has a set of plans and sends them out to bid to several general contractors. Each GC submits a bid to the client, and in most cases, the lowest bidder wins the contract to build the project. In this arrangement, the GC keeps his information close to his chest, and the client guards his internal budget from the GC, and the result is a more oppositional atmosphere where little trust has been built between the team members. The most successful and enjoyable projects I’ve built were in the “open book, GMP” manner, so I had the vision for MPC to operate on all projects in this open book manner. The initial goal was to build that level of trust between MPC and our client, and if we’re successful there, then the construction process would be successful and enjoyable for all parties involved.

How was the first year in business?
The first year in business was as challenging as it was rewarding. When I made the decision to start the company, my son was eleven months old, and without the support and confidence of my wife, Erin, I probably would not be speaking with you right now.

I landed my first project three weeks after I founded the company, as a pure construction manager: a “project manager” for hire, essentially. It was a consulting contract that would pay my bills for the next four months of the business, and gave me the opportunity to keep the lights on while I searched for more work. My first year in business, which I count as April to December 2012 (8 months), MPC generated a total of $100,000 of consulting revenue while putting in place around $1.5 million in construction.

Did you initially have to raise capital to fund the business?
I have never raised capital for the business. I started MPC with a $15,000 personal loan from the social lending site, Prosper.com.

What were some of the challenges you initially faced?
For the first eight months, the biggest challenge was finding new opportunities. I would take on anything, any contract size, just to keep the business going while I got my name out there and waited for some of my former clients to have new projects ready to build. Another challenge would be the lack of history that my new company had. Michael Parnell had a tremendous resume, but MP Consulting Services had nothing! Getting over that hurdle with some people was difficult, while others who had prior experience with me looked beyond that and saw what I brought to their project as a whole. And obviously, cash flow was the largest challenge. Keeping the income flowing to pay the bills, with a small number of projects going on at that time. There were plenty of times where I was on the clock, nearing the bottom of our bank account, wondering if this was it. But every time that happened, I figured out a way to keep things moving along. A new project would pop up and I’d be safe for another month or two.

Did you have a lot of competition?
There are countless construction companies out there, in both the residential and commercial building markets. We differentiate ourselves by the manner in which we operate, and run our business. And to that, I believe we have very few true competitors out there, if any at all.

What was your marketing strategy?
I reached out to former clients, and sold myself as being able to bring a high level of construction expertise to their projects in a low overhead package. This wasn’t too hard a sell, because at the time, it was just me!

Who was your first client?
My first client was Jon Liedersdorff, who was building Lakehouse Music Center, a music-themed complex in Asbury Park, New Jersey. It included two recording studios, designed by the world-renowned Walters Storyk Design Group (they designed Jimi Hendrix’s Electric Ladyland studios, among more recent artists such as Bruce Springsteen, Alicia Keys, Jay Z, and many others). The project also consisted of rehearsal and lesson rooms, office and retail, and a small cafe.

What was an average workweek like for you back then?
I would say I averaged around 50 hours a week that first year.

Is that around the same for you today?
On average, today, I’d say it’s about the same. But they’re different hours than they were back then. I spend more of my time on big picture forecasting and planning, business development and estimating work. It honestly feels like I work 20 hours a week, because I put in the hours when I need to, and spend time out of the office when my son has a practice or game to attend. I finally have the work/life integration that I always wished for.

Were you profitable by the end of year one?
The first year (8 months) I was working as a consultant/project manager, so I had no overhead except minimal operating expenses, and it’s hard to count that as profitable. It was pure income. But that first year, and every year since, we’ve been profitable.

How fast did the company grow during the first few years?
2012 = $100,000 in revenue
2013 = $1,546,165 (1,546% year-over-year growth)
2014 = $3,100,624 (200%)
2015 = $4,767,838 (153%)
2016 = $6,606,978 (138%)

So our four-year growth has been 6,606%, and rising. We’ve already put in place $2,000,000 in revenue as of 4/30/17, and we’ve got $4,000,000 under contract right now, so we’re nearly surpassing last years’ revenue and it’s only the beginning of May. I would conservatively project we put in place $8,000,000 in 2017.

What do you think caused that high spike in growth?
Referrals from our clients and repeat business. We’ve created, as Tony Robbins likes to call it, “raving fans.” And they’re the #1 reason why we’ve experienced the growth that we have. And that boils down to doing what we say we will do: being accountable, trustworthy, and living up to the expectations that we’ve now set for ourselves and our clients.

Did you ever feel like giving up?
There were certainly times when the bank account was low, and I thought to myself how easy it would be to put in a phone call or two and go work with one of my former co-workers who are now spread-out across every major construction firm and developer in the tri-state area. But I know that the freedom to do things my way, the way MPC operates, would be gone, and I’d be playing by another company’s set of rules. And that’s not acceptable to me anymore. I’d also lose the freedom to designate my time how I see fit, to be able to prioritize being involved with my family as much as I am, to bring my kids to all of their practices and games, coach their teams, and have dinner with them at a reasonable hour every night. Those things are non-negotiable now, so to make that happen, I have to succeed in this business, and that’s what drives me.

Did you ever feel you had to sacrifice a lot of personal time for the business?
I have never felt that I had to sacrifice personal time for this business, not once. The business and my personal time are one and the same. MPC is like a third child to me. I balance my time with MPC just like I do with my two children and my wife. Sometimes, one of the four needs to be the priority, and other times it changes. There is true balance, and if anything, my family gets more of my time than the business.

Why did you choose not to take on outside financing?
I knew that once I took outside financing, from investors, that I’d have to answer to them and could potentially lose control of the company, from an operational and cultural standpoint. I’d have to take on projects to hit revenue and profit goals, even if I didn’t think they’d be a good fit for our company. I don’t want to have those external drivers as a factor for how I make decisions for this company.

How do you organize your day?
At all times, I look at what I have to accomplish over the next several days, and several weeks, and organize my work accordingly. What will give me the most return for my time on that particular day, what makes the biggest impact, and that’s what I choose to work on. I’m neurotic about it. And I have to be, because I wear so many hats.

What has been your primary source for new clients?
Referrals from clients, and repeat business. In the residential business, I have great relationships with several realtors in our area of the Jersey Shore, and they’re a great source of referrals. I’ve also built their homes, so getting a referral from them carries a lot of weight with their clients. On the commercial side, repeat business from core clients (higher education clients, healthcare clients, private developers), and referrals to others from those clients, are the main source of our business development.

How did the recession affect your business?
I started the company in 2012, as the economy was on the upswing. So fortunately I missed the past recession. But we’re preparing for the next recession, by diversifying our business and focusing on market sectors that are the most insulated from downturns: healthcare and higher education markets. Those are markets that perform well in recessions, and they are now our strongest sectors of commercial work. Whenever the next residential market swing happens, we’ll be prepared.

What are some of your daily habits that have contributed to your success?
For the past nine months, I’ve been working out four days a week, at 6:30am before everyone in my house wakes up. That’s been great, as I’ve lost weight and feel great, and am very awake for the work day. It also allows me to get my workout in without impacting my work hours or time with the family after work, and I don’t feel stressed about trying to find the time to fit it in. I feel great, and I’m the lightest I’ve been since high school.

What are some quotes that you live by?
“If you’re afraid to fail, you’ll never succeed.” – Dan Gable
“Once you’ve wrestled, everything in life is easy.” – Dan Gable

What are some of your favorite books?
Emotional Intelligence: Why It Can Matter More Than IQ by Daniel Goleman. My entire business philosophy is based around this book. Also, MONEY Master the Game: 7 Simple Steps to Financial Freedom by Tony Robbins. This was a real eye-opener for me, and I’ve reorganized my entire financial life around the information I learned in this book.

How do you define success?
Success to me is having a stable, happy family life. Excelling with my business provides the financial means to make that family life stable and happy, so it’s an integral part of being a success to me, but it is not the defining factor in being successful.

What is the key to success?
The key to success, for me, is maintaining that work/life integration balance. Making the time to be a part of my kid’s lives, and never allowing the success of the business to pull my time away from what’s most important to me.

Did you always know you would be successful?
When I was younger, I had no clear direction. I got into trouble at times, and didn’t know what I really wanted to do with my life. Even when I first started working after college, I wasn’t performing to my potential. But one day, I was figuring out a design question one of my subcontractors came to me with, and after figuring out the answer, my project manager said to me, “Mike, you just figured out the answer to a question that a man who’s worked in his industry for 50 years came to you with. You’re smart, and if you apply yourself, you can really go somewhere in this business.” And from that day forward, I took that advice and focused my life on excelling in my industry. Good things have come my way ever since. That focus has put me in the right place at the right time, and when opportunities have presented themselves, I jumped on them to take those next steps in my career.

What is the greatest lesson you’ve ever learned?
Stick to what you’re good at, focus your efforts on areas you’re an expert in, and don’t try to be too many things for too many people.

Tell me about one of the toughest days you’ve had as an entrepreneur.
A few years ago, we took on a project for a large developer, where we were basically hired to perform one trade, and to bid and subcontract one company to perform the work for us. We were essentially a GC with one sub beneath us, or a broker would be another way to describe it. Just before we were about to start the project, it became apparent to us that this subcontractor was not capable of performing the contract. They weren’t large enough and didn’t have enough capital to be successful. We had to find a replacement sub within weeks, which fortunately we did, but within a month of the project, that company was asking for increased rates for the work being performed or they would decline to continue on the project. With the increased cost to this subcontract, we ended up completing the project but losing money on it. It was a large contract, with a lot of financial risk, and took nine months to complete. We learned from that experience two things:

  1. If an opportunity seems too good to be true, easy money, look long and hard at the potential risks involved and take them seriously.
  2. Remember who we are and what we are good at, and stick to that.

How did you overcome the challenges at hand?
We put our heads down, and muscled our way to completion on the project. There was no way we were going to allow the project or our company to fail, despite knowing early on that it wasn’t going to be a winner for the company. We were able to secure some additional work from that developer, which helped us come close to breaking even on the project instead of losing a lot of money on that initial contract.

What is your vision for the future of MP Consulting Services?
I want MPC to grow in a steady, organic way. We do not set arbitrary revenue goals for each year, because I believe it would cloud our judgement about what type of projects we go after and what kind of clients we work for. I want our growth to happen by our core clients referring larger volume contracts to us, not by trying to win every project we hear about. Fewer contracts, but larger contract values, and we are currently on that path.

As for the company culture, I want MPC to be a place that attracts top talent. Young, energetic, driven individuals who want to advance their careers quickly and take on more responsibility at a young age. Their growth and development should be in lock-step with the growth of our company, so we can stay lean and mean, and perform at a high level.

Finally, long term, I would love for one or both of my children to one day take over the company. They can go into any field they wish when they grow up, and it’s most important to me that they’re successful and happy in the field they choose. But I sure would love it if they took over the family business one day.

What advice would you give to young entrepreneurs?
Do not rush into starting your own company. Gain experience by working for other top companies within that industry, build your network and knowledge, and then take your shot. The contacts you make as an employee will be invaluable to you when you’re on your own, for potential clients as well as resources to reach out to when operating the company. When you’re working for those other firms, don’t just focus on the role which you’re hired to perform. Absorb knowledge from all operational sectors within the business, ask questions and gain an understanding of how the business works as a whole. And when you do take the leap, make sure it’s an industry that you’re an expert in. Your clients are going to be hiring you based on your expertise, don’t try to be something you’re not. And go all in, give it everything you’ve got.