Robert Khachatryan – Founder & CEO, Freight Right

At the age of nineteen, I dropped out of school six months short of graduating to move to U.S. I studied art, business, economics, and law the following five years and founded Freight Right when I was twenty-five. The company now employs sixteen people and has $12 million in revenue.

Freight Right is a logistics and transportation company based in La Crescenta catering primarily to technology-centric companies including freight marketplaces, international freight forwarders, 3PLs, and other resellers of international freight.

How did the concept for Freight Right come about?
I grew up in a very entrepreneurial family and always knew I would be an entrepreneur myself. I was working at a local logistics company and clearly saw everything that was wrong with it, especially all the inefficiencies and shortcomings with customer service. When the company collapsed during the 2007 recession, I learned many of the lessons and was ready to do it my way.

I started the company in the middle of a recession. I had just moved into a larger apartment, had a baby, and had my car stolen. I had no investments and no savings. The only thing I had was a borrowed credit card from my father with a $7,000 limit. In hindsight, it was the most inconvenient time to embark on such a trip, but I did have encouragement from very important people. Ellen, my wife and a new mother at the time, had no qualms about me taking the leap. One of my old customers encouraged me by saying we were at the bottom of a recession and it could not possibly get any worse. There was only one way and that was up.

How was the first year in business?
First year was tough. Some of the first customers I secured were so demanding we were having trouble keeping up. Cash was a big issue and at the time you could not borrow any amount from anybody. A particular challenge was creating an image of a reputable company that businesses would trust with their supply chain. We had TSA inspectors come out to inspect the premises only to find a two-bedroom apartment. At one point, they made me buy a safe to secure some documents because my newborn baby had no security clearance and technically had access to confidential documents. Looking back, it was pretty hilarious.

What was your marketing strategy?
I reached out by phone and email to everybody I knew who needed international shipping. I went big and reached out to some contacts in very large companies (household names). It didn’t last long because we couldn’t handle the business without cash flow.

How fast did the company grow during the first few years?
We had a slow start. The first couple of years we went from $0 to a couple of hundred thousand. We took pictures of the first check we received that was over $50,000 and it was a very proud moment. It was at least four years before we had a solid enough foundation that could support exponential growth.

How do you define success?
Pure profit is a measure that can be achieved by all kinds of people. I measure success by the number of lives I can change. When you run a fast-growing business, you take a high speed train through life experiences that would take much longer to gain at a normal speed of life. New values and relationships are created, tested, and destroyed at an accelerated rate. I always try to mentor people as much as I can hoping my experience will help them be better and more successful people. If I can do that, while also having a comfortable life that allows me to spend stress-free time with my family, then I have succeeded.

What is the key to success?
There are no shortcuts. It boils down to hard work and a healthy amount of risk taking. You have to work hard because there is no other way, and you have to take risks because that is what moves you forward in leaps and sets you apart from the rest.

What is the greatest lesson you’ve ever learned?
I generally don’t look to Donald Trump for wisdom, but he did say something that I learned to be true. You have to hire the best people because they do the best job. A sloppy employee can cause irreparable damage and cost immeasurable amounts of money when you factor in lost opportunity and future earnings from lost customers. It took me a few classes to learn this lesson but I know and I hire the best people I can find.

What are some quotes that you live by?
“What would you attempt to do if you knew you could not fail?” – Unknown

“Hire the best people; they do the best job.” – Donald Trump

“An entrepreneur is someone who will jump off a cliff and assemble an airplane on the way down.” – Reid Offman

What are some of your favorite books?
Getting Things Done by David Allen. A lot of the concepts in this book are made obsolete by apps and software, but there are very useful lessons on how to group tasks, manage projects, etc.

The Road Less Traveled by M. Scott Peck

The Gambler: How Penniless Dropout Kirk Kerkorian Became the Greatest Deal Maker in Capitalist History by William C. Rempel

Tell me about one of the toughest days you’ve had as an entrepreneur.
We had a truck disappear with a critical shipment and a major magazine printer was shut down because of it. The Highway Patrol located the truck a few days later but those were some of the most stressful days of my life. I remember telling the customer that if I had been working at any other company, that would be the day that I quit my job. Quitting is not an available option when you are running a business.

When faced with adversity, what pushes you to keep moving forward?
I have the responsibility to overcome because there is simply nobody else to do it. No manager to escalate to and nobody to share the responsibility with. On the other hand, there are a lot of people depending on me. Dozens of families directly and indirectly depend on me to overcome the adversity. There is just no option not to. Remember that airplane Reid Hoffman was referring to? Well, now the airplane is built and flying at full speed. You are strapped into the pilot seat with everybody on board depending on you to fly this thing straight. The buck stops with you.

What advice would you give to young entrepreneurs?
Think very long and hard if taking the entrepreneurial path is worth it. Remember, uneasy lies the head that wears a crown. You will be stressed and overworked for years before you reach the level of comfort often associated with founders and businessmen. The weight of responsibility will be there forever. It becomes a great story only after the underdog makes it, but make no mistake, there is a hefty price to pay. Imagine yourself at the end of your life looking back. Will you regret not spending more time with your family, working 70 hours a week, and stressing over major decisions and existential threats? After all, nobody ever lain on their deathbed wishing they had worked more. Having said this for some people, this is the only way. You can go to school, work and build a career, but all of that will have just been preparation for your real purpose in life. For me, there was never a choice.



This interview was conducted for research purposes by Jason Navallo for his upcoming book, Underdog.

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