LOCAL ENTREPRENEURS NETWORK
RUSS KAMALSKI
CEO, Canfield Training Group and Co-CEO, Pet Wellness Direct
Your Network is Your Net Worth
Russ discusses with us the importance of developing a strong business network as you progress throughout your career, crediting the success of his entrepreneurial journey to his strong network. His close relationship with his attorney led to the opportunity to collaborate with Chicken Soup for the Soul on a project. After completing the project, Russ realized he enjoyed the work the company was doing and collaborated on more projects. He became more involved with the company, helped grow their revenue and ultimately became CEO. Throughout this whole journey, Russ built a strong relationship with Jack Canfield, the co-founder of Chicken Soup for the Soul. Once Russ configured a deal and sold Chicken Soup for the Soul, Jack offered Russ a position as CEO at his company, Canfield Training Group. Russ took the position and has worked as CEO for several years now. As you can see, Russ’ success in his career has been facilitated by the strong network he has formed. His relationship with his attorney led him to Chicken Soup for the Soul, and his subsequent relationship with Jack led him to become CEO at Jackfield Training Group. Without these relationships Russ formed during his career, he wouldn’t have the success he has in his professional career.
Student Advice
Russ preaches the importance of receiving a good education. He explains how education is a valuable foundation for anyone who aspires to succeed as an entrepreneur. Yes, of course there are anomalies who skip college, dive straight into their entrepreneurial journey and end up finding success; however, the risk associated with forgoing your education is simply too high and receiving an education is a superior option. Another tip Russ offers is getting a mentor. Russ had a mentor who led him in the right direction in a career that was still relatively new to him. Mentors do not have to be parents, simply someone who is successful in your industry and can teach you their methods. They can help you overcome adversity that you are facing and can answer your questions that you can’t seem to answer. Finally, Russ emphasizes the importance of finding your passion and not being motivated by the money. Early in Russ’ career, he worked for large production companies like Warner Brothers and Sony. However, he eventually hit a wall, and lost passion for his work. The money that initially seemed so appealing to him at a young age, didn’t matter anymore. This revelation caused Russ to take a break from work and when the opportunity to work with Chicken Soup for the Soul presented itself, he seized it. Now Russ is finally passionate about his work and the money that he desired earlier in life, simply follows.
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JANETTE SPIEZIO
Founder and owner of zero-waste store Sustainable Haus
The Power of Adapting
When Janette started her business, she never predicted that she would be selling reusable masks. Her product line of personal care items, bags, tableware and more didn’t necessarily align with maks. However, Janette saw the increased demand of masks during the COVID-19 pandemic, and instead of ignoring this demand because it didn’t align with her traditional product line, she seized the opportunity and began producing masks. This pivot for Sustainable Haus not only allowed the business to survive during these burdensome times, but it allowed it to thrive. Janette was acquiring lots of customers that she might have not otherwise acquired, if it weren’t for the pandemic and her masks. These customers have now become loyal supporters of Sustainable Haus and have continued to purchase more items, furthering the success of the business. Janette’s actions perfectly exemplify how essential it is to be able to change trajectory as a business, and how you can change what may have been a volatile situation, into an advantageous one. If she ignored this demand the business would have struggled and would not have acquired this influx of newfound customers. By no means is this an easy task. Janette spent long nights sewing mask after mask, growing her supply and keeping up with the demand. Those grueling nights eventually did pay off as she kept her business afloat during a time when many failed. Sustainable Haus has increased its customer base and are set up for success well after the end of the pandemic.
Passion: The Most Important Thing When Building Your Business
Janette had an incredibly successful career in Corporate America working her way up to a senior executive at Prudential. After decades of working in corporate, Janette became tired of the limitations of corporate and decided it was time to start her own business. Janette pursued her passion for fashion, the environment and spreading awareness about climate change, leading her to open Sustainable Haus in February 2020. It is now the largest zero-waste store in New Jersey. Janette cites her passion as the critical ingredient in building a successful and sustainable business. She didn’t have a specific business strategy when opening Sustainable Haus, instead she was able to rely on her passion and determination to guide the success of the business. Sustainable Haus has grown from a select group of products to over 400 zero waste products available online. Janette has also garnered a strong relationship with the community and loyal customer base, due to her passion for her products and business. Janette’s passion for the environment does not end with her; she expects all employees to be knowledgeable and passionate about the products they sell. Janette and her team sufficiently educate customers on their products and help customers recognize their purchases contribute to a cleaner planet. Sustainable Haus was built by passion; a trait needed when people begin their entrepreneurial journey.
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VICTORIA RANSOM
Serial entrepreneur and founder of the innovative education company Prisma
Creating a Business at the Right Time
Oftentimes entrepreneurs fall in love with a particular idea that they’ve been cultivating for a long time. Consequently, they become obsessive over the idea and attempt to force it into reality, without taking into account external factors. This is what Victoria advises against. She preaches the importance of acknowledging external factors before converting an idea into a business, such as demand and market share. Therefore, timing is paramount when launching a business because opposing external factors can prevent a business from thriving. Victoria practices what she preaches, as she has founded multiple successful companies, all of which have been bolstered by timing. One of these businesses was Wildfire, a software company that helped the business market across social media platforms. You may be thinking, “That doesn’t sound like such a unique idea, thousands of companies do the same thing.” However, it’s important to note that she created this company in 2008! Victoria was at the cusp of social media marketing, when companies were beginning to fully realize the potential in this market. Victoria was able to penetrate a relatively untapped market at the time, which helped her grow the company and eventually sell it to Google. Now Victoria has founded the Prisma, the unorthodox education that is fully online, has no grades, and where kids can choose what they want to learn at their own pace. She knew this company would succeed because the timing was just right. With the pandemic forcing in person schooling online, parents have been reflecting on the quality of education their children are receiving and contemplating if there is a better option. Victoria is taking advantage of that reflection and is providing parents with a new and improved way to educate their children through Prisma. In addition, Victoria is aware that the current public education system has too many flaws: kids are more focused on their grades than actual knowledge, teachers can’t always provide valuable feedback due to rushed curriculums, and students' learning pace is determined by age and not ability. Victoria knew that a change was needed at this time, so she made Prisma a reality.
All About the Culture
There are many elements that factor into building a successful business, but culture-building and hiring the right team are building blocks to every business. During one of Victoria’s first projects, Wildfire, the team she hired weren’t seasoned veterans in the social media marketing industry but they were ambitious and young, hustling to become successful. When Wildfire became popular and expanded, Victoria brought in a few Silicon Valley executives and immediately noticed a change in the workplace atmosphere. The daily operations became more buttoned-up and the scrappiness that the original team had was not present in the executives hired. To some extent, Victoria found that the inexperienced and scrappy team members of Wildfire were instrumental to the original success of Wildfire. It created a flexibility and a willingness to experiment, qualities she has tried to instill in every project.
Specifically, for Prisma, Victoria hired a team that specializes in educating and curriculum building. When it came to hiring educators (or life coaches, which is what Prisma calls its teachers), Victoria looked for candidates with an aptitude for facilitating and acting as a mentor for the students. As Victoria and Alain crafted their vision for Prisma, they were really looking for educators who could do more than teach lessons found in a textbook or be the “sage on the stage” as Victoria said. They wanted educators who were passionate about teaching students life lessons and who are able to tailor the Prisma curriculum to each student in a unique way. Victoria and her husband Alain have prioritized hiring a robust team who possess similar traits to the team members at Wildfire, which became a multimillion dollar company. Entrepreneurs can never do it all alone and having a team around you that brings something different to the table is crucial. As Victoria said at the end of the episode, you want to bring in the right people so you are the “dumbest” person in the room, not the smartest.
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MICHELENE LAMBROS
Founder and owner of the vegan health food restaurant, Soul Bowls
Building the Right Culture
When Michelene Lambros opened up the Soul Bowls storefront location in 2019, she had a lot on her mind but one thing in particular: the importance of hiring the right people. The right people weren’t necessarily the ones who could chop strawberries the fastest or make a bowl the quickest. While that was important, Lambros cared most about hiring good people; people who are kind, respectful, and passionate about providing healthy food options to their community. Good people can be taught the technique to cut strawberries fast and make bowls, and she knew that creating a strong culture from the day the Soul Bowls storefront location opened in 2019 would go a long way in making sure Soul Bowls is a staple of the Scotch Plains community.
Three years later and now Soul Bowls is opening up its second store in Metuchen this spring while the Scotch Plains location is packed every Saturday and Sunday like it's the summertime. Lambros tells us on the podcast that she feels like Soul Bowls has become a movement, largely thanks to the strong culture originating from the employees. There are people driving an hour both ways to try the product along with the loyal customer base that is coming in multiple times a week to get juices, smoothies, and bowls.
Soul Bowls’ success has a direct correlation with the people its hired and it's a testament to what Lambros and the rest of her family have built. They hired good people first, knowing through training and practice their employees will learn how to operate efficiently in the kitchen.
Continuity in the Kitchen
During the podcast, Lambros admits that she used to not be able to trust anybody with her product. Over time, though, she realized that she couldn’t do it all herself and passed the responsibilities on to her employees. Lambros, like many entrepreneurs, is obsessed with perfection — an important trait to possess. She stresses the importance of every employee producing a product the exact same way. While this is impossible to do — to make the bowl the exact same way without any differentiation — Lambros wants Soul Bowls to come as close as it can to accomplishing that. This way customers can consistently receive a high quality product and be satisfied by Soul Bowl’s service. Though this chase for perfection is an imperfect science, ask any entrepreneur and that chase for perfection is vital in accomplishing goals.
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BUSINESS MODEL INNOVATION
Raphael Amit and Christoph Zott’s “Creating Value Through Business Model Innovation” is a publication that has become more relevant than ever. The pandemic has highlighted the importance of having a strong business model that can surmount unexpected obstacles, or shift its structure in order to survive.
The Power of Lock-ins
One of the four major value drivers in business models are lock-ins. A lock-in “refers to those business model activities that create switching costs or enhanced incentives for business model participants to stay and transact within the activity system." One of the best examples of this is the ecosystem of products and services Apple has shared with their customers. A typical Apple user saves their data on iCloud, forms playlists on Apple Music, and downloads several apps from the App Store; the user becomes deeply invested in Apple. If they wanted to switch to Android, they would lose their data on the iCloud, their songs on Apple Music would be gone, and all of their apps and their data would be lost. For many, that cost is too great. They would rather stay with Apple and avoid the inconvenience of switching to a new product. The power of Apple’s lock-ins is what makes lifelong Apple customers so common.
Not all companies have lock-ins as strong as Apple’s, and Peloton’s business model is the epitome of poor lock-ins. Once a user buys a Peloton bike, the user can pay for a subscription service that gives them access to virtual, live exercise sessions. This is Peloton’s incentive to stay with their product, this is their lock-in. However, this lock-in is weak. Many users realized that it’s not worth paying for this subscription, when they can go on Youtube and watch free workout sessions. It was this realization, coupled with the loss of the demand for at-home exercise that caused the Peloton stock to crash.
Extracting Ongoing Value
Extracting ongoing value is one of the most important principles in business models. Companies do their best to avoid one-time purchases from customers, and prioritize continuously extracting value from them. What does this look like? One of the pioneers of this principle is Gillette. When a blade goes dull, customers need to buy a new blade from Gillette to go with their Gillette razor. Blades will never stop going dull, so Gillette is able to extract ongoing value from customers forever. Another example of this is Apple's subscriptions. Users pay Apple to receive Apple TV, Apple Music, and additional iCloud storage. This way Apple doesn’t profit off of a singular purchase, they can profit off the use of the customer’s purchase.
Peloton is a company that failed to extract ongoing value from their customers. As mentioned before, customers avoided Peloton’s subscription by using their own media sources. This prevents Peloton from profiting off of the use of the Peloton, which led to their downfall. Peloton also does not have multiple ways to extract ongoing value, like Apple.
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ENVIRONMENTAL SOCIAL GOVERNANCE
Society is moving in progressive direction and the investment community is following along. ESG is being used to evaluate companies on their social goals that go beyond their traditional role. However, there are many shortcomings with ESG that need to be addressed.
The Divergence
There are three major causes of divergence in ESG ratings, the first being scope divergence. This occurs when two different agencies include different aspects of a firm in their rating. For instance, one agency may include lobbying in their scope while another may not. The cause of this issue goes back to one of the focuses of this episode, which is how the ESG calculating process is not standardized amongst agencies. The second cause of divergence is measurement divergence, and this is when agencies measure the same attributes using different metrics. For example, one agency may “evaluate a firm’s labor practices on the basis of workforce turnover, while another counts the number of labor cases against the firm.” The cause of this practice is that agencies are not always dealing with the same data regarding a specific firm. Because firms are not required to provide information to agencies, the agencies are then left to interpret the small amount of data that was provided, or attempt to find data elsewhere. The final cause of divergence is weight divergence. This is when agencies place varying emphasis on certain attributes like greenhouse gas emissions and lobbying. This issue is slightly more complex than the other causes of divergence because of its subjective nature. It raises questions that don’t necessarily have a right answer. Are human rights more important than employee turnover? Are greenhouse gas emissions more important than lobbying? Individuals’ prioritization of these topics will vary but it’s critical that all agencies attempt to align their values with each other.
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