Attract top people
While most entrepreneurs tend to hire the people they can best afford at that moment, Thompson went straight to the heavy hitters.
“Most entrepreneurs can hire what they can afford and that management team can get the company launched, but sometimes [it] doesn’t have the experience or the background to really scale the organization or to manage it — or it just becomes large,” Thompson says. “What we did was a little out of the box in that we stepped out and we hired that billion-dollar management team day one to come and get the start-up company off the ground.”
What’s even more impressive is that that team came completely from outside the utility industry. Most had been telecom veterans who had gone through the price wars and hyper-growth days in that industry.
“They had experienced the rapid growth that we anticipated for Ambit, and by bringing them in early, we were able to get off the ground,” he says. “The hardest thing is recruiting good people when you’re a start-up, as opposed to [when] you’ve succeeded and have stability and a promising future.”
One of the keys to doing this is to know where you’re headed.
“There has to be a real clear vision of what the company is and what it can be,” he says. “That vision has to be articulated with what your core competency is and what are the hurdles you have to overcome and what are the metrics you need, and how do you judge yourself and what do you need to overcome to achieve that success. There has to be a confidence builder in that you have adequate capital and the management team understands what it’s going to take to build the company and make it grow.”
One of the keys to having that clear vision is to choose a focus and stick to it.
“I’m fond of the saying that, ‘The main thing is to keep the main thing the main thing,’” Thompson says. “So often, people look at all the things they might be able to do and jump in to a lot of things simultaneously and don’t master any of them.”
For example, he knew there were a lot of markets that could prove profitable, but instead of diving into a few of them, he chose just residential electricity in the state of Texas.
He also saw that during the telecom boom, a lot of companies couldn’t keep up with the demand, so part of his vision was being able to handle those demands from the get-go.
“We knew that we had to create systems that could process 10 or 10,000 orders every day with nothing falling through the cracks,” Thompson says. “That was the vision that we set in motion.”
In addition to having a solid vision, to attract the best talent, you have to have the integrity that makes people want to follow you.
“If you’re a leader, you have to exemplify the traits that others admire and want to be around,” he says. “If you’re taking shortcuts, you’re going to lose great people. The best people will leave immediately. They want to be around honest, hardworking, smart, dedicated people. They’re entrusting their futures to you, and you have to respond by making certain that there’s no reason their trust ever waivers. The most important thing is that you conduct business life and private life in the same fashion and that’s one that will make your mother proud.”
If you hire the best people, it will help move your business forward more quickly.
“Success breeds success,” he says. “When you hire outstanding senior executives, they’re capable of hiring outstanding people. If you hire mediocre people who might be intimidated by outstanding people, you suddenly get caught in a cycle where the entire management organization is mediocrity.”
