EP 15 - Michael Pinkowski - Parsimony: Creating 10 Thousand Entrepreneur Millionaires
Michael has been involved in ecommerce since building his first transactional website in 1998. Since that time he has used his expertise to help multiple companies find success on the Internet.
He was COO of iFLOOR as they grew from startup to $50M in sales in 5 years and was Director of Marketing for ATG Stores (now part of Lowe’s) for their journey from $50M to over $100M. Since that time, he has founded his own companies and brought his expertise to half a dozen other ecommerce companies. In 2018, Michael will be focusing on a new entrepreneurial-focused startup, Parsimony.com, which is a complete ERP system for ecommerce entrepreneurs.
Michael earned his MBA in Finance and Marketing from Ohio State University. He and Jennifer, his wife of over 30 years, have the two best boys in the world and live in Bellevue, WA just east of Seattle. His battle cry is “Go. Be. Strong!"
|Awesomers Origin - We'll talk to an Awesomer about where they came from, the triumphs and tribulations they have faced and how they are doing today. An Awesomer Origin story is the chance to hear the backstory about the journey our guest took on their road to become awesomer. These stories are incredibly varied and the takeaway is that awesomers come in all shapes, sizes, backgrounds, creeds, colors and every other variation possible. On your awesomer road, you will face adversity. That’s just part of life. The question as always is how YOU choose to deal with it.|
Parsimony is a System of Systems, and also one of the Great Sponsors for the Awesomers.com Podcast. Click Here to learn more!
“Go take action, do something, get into motion, go be an athlete, be an artist, be in love, be somebody, be yourself. You've got to make a difference, go be strong.”
These are just some of the few words of wisdom that today’s guest shares with us. On this episode, we get to know Michael Pinkowski, President of Parsimony.com. Michael has been involved in E-commerce since building his very first transactional website in 1998. Since then, he has used his expertise to help multiple companies find success on the Internet. Here are some of the things he shares on this episode:
His journey from a corporate executive to entrepreneur and founder of successful companies.
Why it is better to figure out your strengths and goals; whether it’s money, security or growth and development.
And how he helps E-commerce businesses get access to world-class technology and be able to deliver solutions that are sophisticated and affordable.
Welcome to the Awesomers.com podcast. If you love to learn and if you're motivated to expand your mind and heck if you desire to break through those traditional paradigms and find your own version of success, you are in the right place. Awesomers around the world are on a journey to improve their lives and the lives of those around them. We believe in paying it forward and we fundamentally try to live up to the great Zig Ziglar quote where he said, "You can have everything in your life you want if you help enough other people get what they want." It doesn't matter where you came from. It only matters where you're going. My name is Steve Simonson and I hope that you will join me on this Awesomer journey.
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1:15 (Steve Simonson introduces the guest, Michael Pinkowski of Parsimony.com.)
Steve: Hey, it's episode number 15 of the Awesomers podcast and we've got a super-secret insider tip for you. If you go to Awesomers.com/15, you'll be able to find the relevant show notes links and details that we talked about today. So you don't have to worry about keeping track of it yourself. That is Awesomers.com/15 and we're going to have all the show notes there for you to try to make your life a little bit easier. Today's guest is Michael Pinkowski, who I've known for almost 20 years probably. Michael has been involved in e-commerce since building his very first transactional website in 1998. That's right kids 1998, that's a long time ago. Since that time he's used his expertise to help multiple companies find success on the Internet. In fact he was the COO of I-Floor, as they grew from a start-up $0 revenue to 50 million in sales in less than five years and was also the director of marketing for AEG stores which was acquired by Lowe's on their journey from about 50 million to over 100 million. Since that time he's founded his own companies brought his expertise to half a dozen other e-commerce companies. At this time Michael's putting all his energy on this new entrepreneurial focus startup called Parsimony com which is a complete ERP system for e-commerce entrepreneurs. Michael earned his MBA in finance and marketing from Ohio State University and he and his wife Jennifer, of over 30 years by the way. His wife of over 30 years have the two best boys in the world and live in Bellevue Washington just east of Seattle his battle cry as always is goal be strong. Michael is a great guy and an advocate for Awesomers and entrepreneurs around the world and definitely has the experience that all of us can learn from. I want to give a little full disclosure that I started Parsimony along with Michael and this has been a passion project of ours and something that we've worked on in terms of developing software and comprehensive system for systems for companies for going on earlier 20 years. And it's really a fun method of bringing systemization to companies around the globe.
Steve: All right. Welcome back to Awesomers.com coming back to you on the podcast. And today we're joined by a very special guest an old friend Michael Pinkowski. Michael, how are you?
Michael: Good Steve, how are you?
Steve: Very well indeed, and I'm looking forward to sharing kind of your Awesomers origin story. Some of the pieces that I know may be better than the average listener for sure. How long have we known each other Michael?
Michael: I came up from Portland to you in 2000.
Steve: Yes. So that's a long time for those keeping score at home. So again, thank you for joining us, Michael. We're going to talk again about where you came from and let some of the Awesomers out there listen to know that even guys who've accomplished a lot even though there's a lot of experience behind you that we all kind of go through the same stuff. And I think Awesomers out there love to hear it. So maybe you could start out where do you live now and what are you up to in general terms?
4:27 (Michael shares his origin story.)
Michael: So we're in Bellevue and have been in the same house for 16 years, which is a real change. I was from my youth. I moved a ton as a kid. But Bellevue's just outside Seattle pretty close to you, beautiful community, really hilly and stuff. If you're not from some of the flat parts you'll get lost out here winding around the hills.
Steve : Boy. It's a really beautiful area that's for sure. And you live on a specific hill yourself as I recall.
Michael: Yes. We're up on Somerset Hill.
Steve: Yes. Like it's a really tall hill and it is not easy finding your way around those beautiful areas. So what keeps you busy these days?
Michael: Well we are working on this project we call Parsimony, which is a chunk of software that lets you run your business. Specifically a marketplace business. And it sits in between QuickBooks which is like a pretty good checking account type software. And then something like a NetSuite or an Oracle or an SAP or something that can run your business. But it's going to cost you a hundred, two hundred or five hundred thousand bucks a year to do it. So there are all these businesses in the middle that needs software to run their business more efficiently. There aren't a ton of great answers and especially for marketplace e-commerce companies. It's especially tough. So we think we've identified an opportunity to take some software and fit it in there and make it work for these guys. And I am desperately trying to get it launched because there's a whole bunch of folks that need it.
Steve: Boy, it is a big need. And full disclosure for everybody out there that I am a shareholder in Parsimony and it's something that Michael and I worked on many years ago building a software platform called Parsimony. And this is a modern iteration of that, so we'll talk more about that later. As most of the regular listeners here, Parsimony is one of our sponsors. And it is really important for entrepreneurs to build systems and this is a system of systems. No doubt about that. Would you agree, Michael?
Michael: Absolutely. And it lets you run your whole business.
Steve: Yes, for sure. We'll probably dive back in. But before we do that, we're going to take a quick break and dive into your kind of origin story. Where did you begin and so forth. We'll be right back after this.
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7:50 (Michael shares more information about his background.)
Steve: Ok here we are. We're back again. Talking to Michael Pinkowski, Parsimony.com and we're just talking about his origin - where did it begin and how things get started. So Michael where were you born?
Michael: Born in Chicago, I'll do this as fast as I can, suburban in Chicago. So Chicago to Denver to Chicago to Denver to another part of Chicago to Minneapolis to Portland and then I entered the 4th grade.
Steve: Wow that’s a lot of moving.
Michael: And then in my professional career. It was Portland, San Francisco, Miami, Columbus, Ohio for graduate school, a couple of Pennsylvania, Delaware, New Jersey all working for the same company but three different states. And then back out to Portland and one day I met you and came up to Seattle and like I said I'd have been here for 18 years.
Steve: I don’t remember the old Johnny Cash Song, but I've been everywhere. It rings a bell so you could give Johnny Cash right for the money.
Steve: Now what about your parents? What kind of background did they come from?
Michael: Mom and dad, I mean I've got six sisters. So mom was at home a lot, taking care of kids. Dad started in sales and marketing and then he worked on a couple of things. At one point he was selling flexible tubing, so think of a corrugated metal tube that he could bend to fit. And he ended up selling some of that. The guys making rockets and my dad knew nothing about rockets, but the job was to sell the stuff and he did. And then I worked for Boise Cascade on the lumber and paneling side for quite a while and that's really what brought us out to Portland. And then they said they wanted to move again and dad said: ”I can't move again“. He said he just don't understand he’s got too many kids and starting over too many schools. It's just too hard. So he quit. And then he got hired as a contractor for a little bit, but after that, he got a call from a neighbor that said ”Hey I'm a shareholder in a company that's just doing terrible and we'd like you to come on and they need some sales. You could sell some stuff”. They were doing what they used to call ethical drugs. This would be pharmaceuticals. Before the FDA really started cracking down on that stuff. And dad came back to the shareholder one day and says; “Hey the owners are drunk.” So they finally ran him out and dad said: ”Okay well it's good that he's gone but now who's going to run the place?” And the one shareholder said “Well I can't do it. I'm a prestigious professor at the medical school.” And the other shareholder said “Well I'm a prestigious attorney here in town I can't do it but Andy it's like you're there every day. Why don't you run it?” And so my dad found himself part owner and eventually full owner of a company manufacturing vitamins and nutritional supplements and selling them into. Well finally his big customer was Costco and he was doing tens of millions of dollars with Costco. And then he sold the company. He's now happily retired and living with mom down in Portland and traveling and doing great.
Steve: I love it. Even your dad will find an entrepreneurial twist at the end there. That's amazing.
Steve: And as I recall, I remember his talking about some of his Costco stories and so forth. It's very interesting times back then for sure. And this was before the pharmaceuticals or supplements or whatever, became a big craze that they are today.
Michael: Yes, he was at the front end of that thing. When they first started, when Costco started to realize, well first of all Costco was growing and then they realized, see there was money to be made here. And they just participate in that whole ways.
Steve: Yes, you alluded earlier to someplace in the Midwest that doesn't ring a bell, but it was University related. Where did you go to university?
Michael: Well, so I got my undergrad at a little tiny College in Oregon a place called Linfield. I got a Business Administration degree and then I worked for a couple of companies and I just I realized that I was going to be in sales the rest of my life. And it really wasn't me. I could do it but I never, it was not a part of my why. And so my dad had been barking at me since high school to get an MBA. So my wife of less than one year and I sat down and talked one day. And said we got to do something and so we went to Columbus Ohio to the Ohio State University. And I came out with a double major. One in finance and one in marketing and got an MBA.
Steve: There you go. And how did you like that experience by the way?
Michael: That was an extraordinary experience. I would love to go back to school tomorrow. There's just something about wrestling with those puzzles and problems and having heated discussions with your classmates about stuff. We used to go to the cafeteria and just like I suppose that letting kids go and hang out someplace. We would sit in the student union with our muffins and our coffees and talk smack about Jack Welch. What's he doing? He's crazy jock. He knows nothing. We've got it all figured out. Like a couple of kids with baseball cards trying to figure out the great game of baseball. We were just talking smack with the Wall Street Journal and stock prices.
Steve: Yes. I love it. That's one of those inmates running the asylum concepts right. The college kids can tell Jack Welch the way it is. Even though it's the most valuable company on the planet at the time. I love this. So one of the things that you know I always like to dig into. What was your first real proper job? Maybe when you got a W-2?
Michael: So I worked for my dad for a while and got W-2. But my real job out of college was selling conveyor belt. Again Pacific Northwest tons of lumber going on so I had sawmills, paper mills, sand and gravel pits. A number of agricultural places. All these guys had a conveyor belt and they had industrial hoes. And then I had a route, basically I had a couple of territories and I would climb in the car in the morning and I would go and check with them and just see if they needed going to what we called industrial supplies; fire hoses, air hoses, cleats on their conveyor belt, rubber mats all sorts of couplings and belt hinges and stuff like that. And I loved it because I got to go into all kinds of businesses. And see I can tell you a lot about how to make veneer and I can tell you how to make two by fours and rough hewn lumber and what planners do and joiners and I can tell you about sizing gravel in a pit. I can tell you about how they make french fries with a water jet. I've just to be in those facilities, see those things happen. And it feeds my learner. It feeds my curiosity but, how did things work? But what is this thing that's going on and I was young and single at the time. So a paper mill will shut down at Christmas time and they will do maintenance so we got called all the time to go and put in a conveyor belt here or there. They need a new hog chipper belt.
Steve: That's a note to self and the audience. Check your hog chippers everyone let's keep us maintained well.
Michael: And so on Christmas morning, when all my sisters were running around I would jump in the car and we'd be meeting at a donut shop at 6:00 so that we could be in the plant at 7:00. And we'd be stringing conveyor belt over the police and over the master pulley and getting it all set up and running. So that when they came back to work at the end of the week they had working conveyor belts and I got just to be in the plan vulcanizing rubber and stuff like that, it was awesome.
Steve: That's crazy. What a journey from industrial sales and implementation all the way through to technology. There's been probably a twist or two in the wind as well.
Steve: So let me ask you this, so based on where you are today and maybe from that first job. What's the defining moment or perhaps moments that set you on the course that took you where you are today?
Michael: I'll try to keep this short. Because I guess this is only a four hour podcast.
Steve: Well that we break it into three chunks. It's four hours times three so were okay.
Michael: So I was working. I went to graduate school at the Ohio State University but I needed to pay for it my dad was still putting my sisters through college. So I had to figure out what was I going to do. So my wife got her job and I needed to get a job. So I'd go to school all day and I found a job, six blocks away from our apartment. And a little bit of a technology company called CompuServe. Back before the internet, it was CompuServe and they were owned by H&R Block. They would put these custom-made computers. I think they called him PDP Tens and they would put him in the back closet of all of these H&R Block offices around the country and connect them to phone lines. And then you would dial into a local number on a modem with all of the buzzing and clicking. My kids have no idea what those sounds are now and you would dial in 1200 baud 2400 baud and be able to connect to this community. And and I loved it so I did become customer service and I would get there after school. Sometimes we were out at 3:00 sometimes we’re out at 5:00 so I'd show up between 4:00 and 6:00 and work until midnight on customer service and then I'd go home and sleep for a couple hours and catch the 6 o'clock bus going into campus so that I could get some homework done. Talk smack about Jack Welch and go to classes all day. So I had this great experience learning about a connected community. Learning about technology and you could download images, you could download software, you could download stock prices, and you could talk about whatever you wanted to talk about. And it was just really cool. So I get down with that and I've got my MBA and I get a job working for a flooring manufacturer in New Jersey. The deep south side down around Wilmington in Philadelphia but on the Jersey side and I would walk in there carrying my Macintosh 512k that I paid 6,000 bucks for. And I would plop it on my desk and the executives were proud that they subscribed to a clipping service. To keep track of their competitors and that meant that every quarter, they got copies of newspaper articles from around the country. I turned on my computer, I'd get in at 6, I turn my computer on. I had a clipping folder but it was digital and so if I start Armstrong or Congoleum or somebody like that. I got the article and I could print it out, go to the copy machine and make six copies and then slide them under all the executive's doors. They come in the morning and they had this news headline that might be in that morning's Wall Street Journal but maybe not and boom ready to go. So I was working at this company. I was trying to say we could do so much with technology. They were old school. They had this huge IBM mainframe in a glass enclosed room just like Mad Men. The programmers are only four people allowed in the room and they wore a lab coat when they were in there and stuff. Meanwhile, I'm down the hall running the circles around him on a personal computer that I bought. So then we went into a new line of business. We've been residential. We went into commercial and there were long-term established players there and they had totally depreciated all of their equipment, their cost of goods. They were doing huge volumes. They got great deals on raw materials. They had no new machinery expenses no depreciation to worry about. And we show up and we've got to build a new plant at modern-day prices and we don't have any sales volume or relationships. We've got no buying power. Nothing. And we're trying to launch this product and the strategy was, we're going to do it on color because the colors that were out there were boring and we were going to do it on bright colors. And that was going to appeal to designers and architects. They were going to say wow I want this product because I can make this beautiful space and I can only do it with these colors. So I thought we really got to get cozy.
Steve: Yes, let me jump in there. So just to recap for our audience the idea of having an entrenched competitor who's already dominating the market. Who already has all their equipment paid for and their supply chain dialed in is not to go in at a price. This is the point they went in and said, ”You know what, we're going to have to do this on color and we have to differentiate in a unique way.“ Carry on Michael I think that's very interesting.
Michael: And then we knew that the good flooring contractor wasn't going to care about color. You needed to get a project specified so a designer and an architect are putting in a new hospital, they're putting in a new school, a new shopping area. You needed to get them to say wow, the colors of my logo are available in this floor tile. The colors that make the statement that I want to make are available in these things. So you really needed to talk to them and we did a lot of it with print advertising and stuff. Meanwhile, I still got this computer and I'm still using it to do all this stuff and I'm thinking architects and designers are forever behind the eight ball. They're forever trying to catch up there. We knew that they were adopting stuff digitally. They were moving to CAD and stuff like that and I said we have an opportunity to take a technological advantage of our competitors. And we can jump in here and be the sort of the digital version of a flooring company and we can have high speed sample programs. We can have beautiful images on the website and stuff like that. And I got our advertising agency to quote $10000 for a website and I thought well that's a lot of money. This is 1995 and that's a lot of dough. I said how does it work? Is there something we can do? They said, “How does your microwave work? You don't need to know how something works. We know how it works.” It's ten thousand dollars and so anyways I kept fighting this fight because I just said there's a strategic opportunity here to take our story directly to the decision makers with the thing that they want. We can take our story directly to them. And then the product of the color is there and we knew we had good quality. And I just I felt really strongly about it. I've been on this project for probably three years at this point. I had been in dozens of focus groups. I'd traveled the country. I talked to dozens of flooring contractors and architects and I've done all my homework and I knew this was it. And at that time we went through another round of a new Chairman, new president, new director of marketing in our group. And the guy that came in was old school. I say old school, he's like my age now. And he said, “So what's this internet thing?” And I said, “It's a key part of our strategy and here's why it's going to be a winner.” And he said, “No. It's not.” At this point, I had invested too much into it. I had sunk and I knew it. After a while, you just know you're there and I said “No, this is it” and finally it kept escalating. He kept saying no and I kept saying yes. And he finally said, “Listen, you need to let go of this and if you can't let go of it. You need to leave” and I said, “Make me an offer”. And he gave me three months severance and I left. I went back out to Portland where my folks were, brought my wife with me. I started my own company building websites for flooring companies that were desperate to take advantage of this opportunity to disseminate information over the internet.
Steve: It is such a funny thing to think back about. People still resisting the internet. Today, no major company would have a word to say about not having an internet presence. But back in the day, people fought the internet. It's a fad. It's irrelevant. It doesn't apply to us whatever it is. It's nuts. It reminds me of the story of the founder of Atari who was offered an investment. I think it was $25,000 or some amount of money Steve Jobs had worked at Atari quit said: “I got this idea and you can own 30% of the company or a third of the company, 33%.” I suppose. And I don't remember if the numbers 25,000, don't quote me on that. But some low amount and the founder of Atari who was rolling in at that point, “No, I’ll pass.” Because he just didn't see the Apple vision and at that point that company didn't see the internet future. So that defining moment took you out and put you on the road to then starting building websites for people whether they need it or not right?
Michael: Yes. At that point, I had this background. I'd built sort of around home furnishings, home-improvement stuff. And at that point, I mean I went on. I bought server and I paid for a high-speed digital line to come in at one point, I have my own Class C IP address block. And I had to learn how to do servers, on how to do forms and how to run payments. And I had to figure out all this stuff. But it gave me this sort of background into how, at least what the names of the building blocks were. And how some of them worked and so that was really helpful. And then I met you and I got this sort of graduate school of course in E-commerce and all the stuff that we were doing. And then in the course of some other opportunities, I saw other companies doing stuff and how they went about it in different systems and stuff. And I always tried to stay relatively sharp and I still can't code my way out of a cotton bag but I can talk to a developer and say, “ Where are we going? What are we doing? It needs to do this. Do you think this is the problem?” and kind of hang in the conversation and get something done.
Steve: Well this is one of those challenges. Programming is designed to solve business problems, so it really does take a business perspective to deliver the right solution. But to be able to speak with credibility and even understanding with the code community so forth. It dates back that far. It definitely has been a long time coming. Today people take for granted on how simple it is to make a webpage and to have a full-fledged platform at your fingertips for such a small amount of money. Pick your poison whether it's Shopify or Wix or whatever the soup of the day is. But back then I remember trying to get in 1996, trying to get a text and an image just to line up on top of each other and then try to do four of those. This is an HTML1. It was a nightmare.
Steve: It's very challenging. Today, it's much easier but there are other challenges exist tech wise that's for sure.
Michael: One day I put a table inside a table and it changed my life. When I discovered I could nest tables and use that to format stuff and get it to line up. Boy, that changed my life.
Steve: Yes. What a what a glorious day. Well speaking of lessons learned, is there a big lesson out there that you may have learned on your journey so far you want to share with the folks out there?
28.58 (Michael talks about important life lessons.)
Michael: Yes, so my son and I were talking about Survivor Bias the other day. And the other phrase for it is “History is written by the winners” right. And it's easy to listen to books. I listen to a lot of books. But to go to books or podcasts or movies or newspaper articles and say, boy, this guy was really successful I should do what he did. If you want to make a really outstanding computer company that's going to sort of take over the world, the secret is not to name it after a fruit. That's not the thing that makes the difference. I remember when Apple was out there it was there was an orange and a peach also. Thinking that must be the secret to micro computing.
Steve: And then Blackberry came later.
Michael: I have failed a ton and I haven't really had any particular enormous success yet. I mean if I had taken a regular desk job, I would arguably be further ahead money-wise than I am today. I'd be miserable as hell because I have loved this ride, this roller coaster, the chance to learn stuff and experience it and the opportunities that I've had even when I wasn't able to capitalize on them. There's something about an opportunity that just makes you feel more alive for what you're doing. But I talked about building websites well I did that for five years but I did not really succeed at it. I just didn't have the technical chops to kind of get over the hill on it and maybe you think that's moving fast now. It was also really screaming in those early days, there were new things happening and it was hard to find out about them. And then I did that, I had another time. I had my own business in the paintbrush industry and failed there, lost some investor money and I've been in other companies that had failed. I was at one company as director of sales and marketing they said, “Mike if you can double sales in 90 days the job is yours permanent.” I doubled sales in 70, 60 days and in 70 days they went under.
Steve: Well, see you didn't listen to the instructions Michael. He said 90 days.
Michael: It's too easy to say, “Well I'm going to do what the winner did.” and that's not going to work for you. What would you need to do is figure out is what you're good at, what your strengths are and then just keep getting back up on the bike and keep trying. And I'm going to be 60 this fall and I'm hoping that around that time, I'm going to be starting to say wow I think I'm going to find great success. I mean when I was 25 I said I was going to retire at 55 and now I'm going to retire at 75 but I'm having a ball. So the lessons are figure out what you want right. If all you want is money then you really need to get into cocaine and opium and things like that. Because that's where the money is. If what you really want is safety and security, go find a good desk job someplace and then just cross your fingers because you're sort of at their whim and stuff has changed. But if what you want is to learn and to grow, put yourself into risky situations, take chances, fail and then pick yourself up and get going again. And none of it’s ever personal. It's just a thing that happened and dust yourself off and get going again. And then just be open. As I said, that defines a lot about what I believe in the world. You got to keep getting new ideas and trying to synthesize them and don't burn bridges. Because you and I work for a while and then we didn't, but we still got together for a beer or some chips a couple of times a year and I still do that with everybody that I ever worked for. There's nobody that I can't go back to and have a beer with the East Coast guys. I see them once in a while. At a convention sometimes. But of the folks around here, I see all of them two or three times a year. Have coffee talk to them, they all want to know how I'm doing. They reach out to me and say hey Mike would you talk to this guy he needs some of your advice. So don't burn bridges, getting bitter over a bad circumstance will do nothing for you.
Steve: Oh yes. Excellent series of words of wisdom there. That's a very good lesson to be shared. Thank you for that. So along these lines, AWESOMERS are brought up to know that you have to take risks. You have to try to lean into the concept to fail fast which is really just a lesson learned. Everybody uses the word fail like it's some big finish line oh fail, game over but really it's just a part of the course as things go on and there's nobody, there's nothing including Apple or Amazon or any of them that haven't had massive failures along the way and you just have to learn and get better and iterate and move on. So very good lessons there. But at any point along the journey not pointing to any specific area. But was there a time where you just say it was worth it? I know I'll be miserable but I got to get me a cube job that I can just put my head down and forget the crazy entrepreneurial side of the equation.
35.08 (Michael talks about a challenge in his career.)
Michael: Yes, the paintbrush really destroyed me. It happened during the Great Recession of 2008. Thought I had a patentable product they didn't and I had taken money from friends and family and strangers and it just was not going to happen. And at that point I told myself, you've got entrepreneurialism and you can't have another drink. You will get toasted and end up in a gutter again. You cannot touch that sauce. So I did work a desk job for a long time and I got really frustrated because I'm an entrepreneurial guy right? So I was trying to intrapreneur and I ended up looking like the leader of the rebel forces. And then it caused problems inside the organization and then something. I would move to another company and try to get them going and after a while, they would say yes. But you're moving too fast on this thing or you're taking us in a different direction and we feel like you're slowing us down because you're going the other way or something. It was just all not a good fit for what I'm good at. And now I'm in this situation where I've got everything on the line. I wake up in the morning and I go what can I do because I got this goal. I got this thing. I want to get done and where can I try to find a way to move it and make it happen? And it's really as risky as anything I've ever done. I've never felt more optimistic about my future.
Steve: Yes. It's going to be great. It is a big risk and it's a big bet but it's for all the right reasons and I definitely agree with you that sometimes giving up the comfort or the stability and taking the risk is worthwhile because it just when it pays off, when you have that lifestyle or at least that sense of just waking up and going I don't know what today's going to bring. But it's going to be fun and even if I have some setbacks I'm going to work out the problems. That's a better way to live for sure.
Michael: All of those other failures, those are bruised and bumps and stuff and you do learn from it right. You do say “Wow I am NOT doing that again.” There's a difference between a utility patent and a design patent and you don't just think it's just because you got the design patent doesn't mean that you've got anything. And so that’s like a huge mistake that you make where you say, but I've got a patent and you don't, right. So all of these times that you fail. Then when you get to a new situation then you evaluate it, you're a lot smarter and I don't know how the guys though, the men and women that are twenty five years old, I don't know how they look at a situation and sort of make the right choice. I honestly think some of them are lucky because you can't possibly be able to bring another 40 years worth of business experience to bear and say no this is going to work. But here's why I think they either get lucky or they've got an enormous amount of passion and energy. And they just will it to happen but all of those failures are worth something and they can help you understand how to evaluate a new opportunity. How to get through a new truck, a tough spot and they give you resources. People that you've met along the way that can get you through those troughs to the other side.
Steve: Yes. For me, it's definitely just another slice of education even when we would have some issue or error or problem that was caused by one of the past companies I've had. We would just stand around and people often would be gosh this hurt us financially or this or that and they're waiting for the sky to fall and say, “Hey this is another degree at Oxford. Let's learn the lesson, let's be smarter.” Well at least when it comes to decision making my general rule is, don't make the same mistake twice or if twice at least not three times.
Steve: And it can be the defining way of kind of pivoting away from problems and towards the solution. So how about in your professional life? Was there a best day that you look at - gosh now that was a nice day, whatever that day was.
39.48 (Steve talks about the best day of his professional life.)
Michael: When I was really young, I was selling conveyor belt and there was a huge paper mill, longview fiber, they did corrugated paper so it's not like newsprint or toilet paper or something. Those huge corrugated plant and they put out a big project to bid and I was in there with guys that lived, I had to drive an hour to get to the plant and I was competing with three other companies that literally were all within a mile of the plant. They lived and died off the business that this plant would throw off. I drove up from Portland and kept knocking on the door trying to find this project or whatever. And they said, “Okay we're going to do this huge expansion and there's all this conveyor belt and it's all going to be outdoors. And this is an area right by the Columbia River so they get wind, rain, snow, and ice sometimes but the plants got to run.” So the conveyor belts and they didn't have infinite amounts of space so they wander and some of the belts pretty steep and they would put a rubber cleat think of a like a three-quarter inch by three-quarter inch black bar that they would give some traction to keep these wood chips going up the hill right. If they were just in bad weather, if it was a flat belt the chips just all slide to the bottom and make a mess and everything comes to a halt. But he could put the cleats on there it just kind of keeps digging at it and pulling the chips all the way uphill. So he put the speck out and it was a big project. I recall it being a hundred eighty thousand dollars with a conveyer belt on a bunch of different projects and maybe a third of it was cleated conveyor belt. Some people made some of that in mass production, but most of it was made by hand. You would have this hot bolts and you put rubber in there and drop them into a press. You put it in 300 degrees and a certain amount of pressure for half an hour and then you puff them off. Lift the press, puff the mold off and you have to vulcanize the rubber into the conveyor belt and created this pattern. So if it was a flat belt it'd cost, I don't know ten bucks a foot and if it was a cleated belt it costs $35 a foot. It's still the same width same length everything else but the putting the cleats on would add a ton of cost. So we get this opportunity and again I just think young kids, single, not doing anything and I'm sitting on the floor of my room and I'm looking at these specs. And I go, man the guy that engineered this thing didn't engineer it very well. I mean I'm not that smart but this facing is too tight. It's going to be more raw material but mostly time this has got to be. And the presses a lot longer to run all these molds. So I went and I found all the older guys that knew stuff and I said I want to take this spec and I'm going to quote their spec but I want to build a new spec and I want to convince these guys that they can save money by spreading out these cleats but changing the angle and by changing the size. They can save a bunch of money and not change performance at all. Right? If you're trying to move a thing it chips up but you've got cleats on six-inch centers, 12-inch centers, 18-inch centers that doesn't really change the capacity of the belt very much. So I respect it and did it on the down low. I went to the purchasing guys and I'm a kid I'm 24, 25 years old and I'm in with guys that have been walking this plant for 30 years. They go to the same softball games, the same churches as the buyers do all that stuff and somehow they let me keep my secret. And I had this big meeting with the engineers and my headquarters guys wanted to come to the meeting and I said no I got it. Yes, it was my idea. I verified it with the veterans that know how to do this stuff. They tell me that feels good I'm going to go in and pitch my idea. And I did and they accepted the spec and I got the single largest order in the history of the company.
Steve: That's an amazing story. I love the fact we've just talked about how great experience is but it turns out innovation and bringing unique approaches to solving a problem are valuable at any time which is always true. Yes, I love that idea of just figuring out another way to do stuff, so the single largest order in terms of the company history, that's amazing.
44:33 (Steve talks about how Michael helped him in the past.)
Steve: And just for everybody's benefit out there. Michael, he helped grow a company that I started way back in the old days from zero to 50 million over the course of five years. He went on to another company after that. Went from 50 to 100 plus million in a similar time frame in all of this, in marketing and operations and just all really great accomplishment. So Michael got tons of Awesomer history including that very special story we just heard. Yes, please.
Michael: It was a day with you, we were pitching our company on Sand Hill Road and if there's the Silicon Valley which is presumably the heart of technology compared to lots of places in China, in New York and even here in the Microsoft's backyard. But then the heart of Silicon Valley is Sand Hill Road and I remember we had two meetings on, so we had meetings all over the valley but we had these two meetings on Sand Hill Road where we went into some capital firms and showed them what we were doing and wowed them. And that was pretty cool to be able to say I've pitched a company on Sand Hill Road. I never thought I'd do that.
Steve: Yes. Not only did we do that as I recall. You and I spent a little time on Madison Avenue doing some PR runs.
Michael: Yes, we did that and celebrated by going to Peter Luger.
Steve: Oh yes one of my favorite places for sure. Yes I love that. So boy there's a lot of good stuff. I don't know if I'll be able to get it all in show notes but Peter Luger is a great steakhouse in the Brooklyn area.
Steve: Yes right under the bridge as I recall or somewhere near it.
Michael: And when we went it was a lot sketchy as it is today.
Steve: Yes that's quite right. We're going to take a break and talk about the future and some of the ways that you're making a difference today. But before we go, do you have a favorite tool or an app or something that kind of helps you get by day to day obviously ours should be out of the running because you're too biased but favorite tool or app or any little technique that you like to share with the Awesomers out there.
46:50 (Michael talks about his work technique and apps.)
Michael: Yes. So you got to use what works for you right. But for me, I'm pretty visual and everything is a story. I mean you've seen that just talking now and you've put up with it for years but for me, everything's a story. And there are parts to a story. So when I've got a problem to solve and I'm talking about whether I'm trying to write an ad or build an org chart or figure out a process or whatever I go to Keynote and I'm like PowerPoint. But I go to keynote on my Mac. I started doing it, I don't know ten years ago or something and I could just sit and I could say here's a part of the story that I want to tell and then Keynote, I had text available to me I had simple shapes available to me. I could paste in pictures if I needed to. And then I would see another part of the story and then after a while I'd have five parts but I decided that part four really needed to be ahead of part one and I could just grab the slide and move it up and I could sit and move it all around. Then when I wanted to I could drop a theme behind and all of a sudden it started to look good and then I could take the slides that didn't fit anymore even though they were incredible. When I thought of him the first time and I could just drop them way down to the bottom as a kind of an addendum or a footnote or whatever. And I do it all the time I mean one of my boys needed to do an English assignment the other day and I did the same thing I just treated Keynote like an outline. But there was something about that nice big white space where you could put in a big font. You get to work in 60-point fonts and you can drop this thing and I said okay we're going to write a paper so it's got to be a five-page paper. So we're going to have this beginning and then we're going to have these three points we're going to make and we're going to have this summary. I put together a five slide thing. Now, in the beginning, what are we going to talk about? We're going to talk about these things. Then drop them in. Point number one, we should have some substantiation. Then drop it in. I do that, I Keynote every day and I use it like Evernote. I mean I just dump stuff in there to catch it and it doesn't work for everybody but I urge it. If you've been thinking that Powerpoint is only for making decks and decks are old-school, you're missing out on the secret sauce of the tool.
Steve: That's definitely that's a very good tip, Keynote is not only powerful, they have an online version now. You don't even need to have a Mac that is completely collaborative similar to Google Docs and it allows you to have that great power of the visualization combined with the online collaboration and it is dead simple to us. It is a great tool that I use as well. All right well, we're going to take a quick break and then talk about some of the future things that are out there will be right back.
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Steve: Ok here we are. We're back again with Michael Pinkowski, Parsimony.com and we're talking a little bit in the past here about the origin and where Michael’s experience and so forth came from. But now we're going to ask him to talk a little bit about the future and maybe give us a prediction about where he'll be and what he'll be doing in five years. Any futuristic prediction about itself or the industry or the world at large?
50.24 (Michael talks about his views on the future.)
Michael: Well for me there's one overarching thing that dominates my mind and that is in five years using Parsimony, I want to create 10,000 millionaires, that's 10 billion dollars worth of value and I honestly believe I can do it. And I'll do the math fast for you. There are 400 thousand or so Amazon sellers out there. I only need ten thousand of them and really, those are ten thousand companies. Right? That some of those companies have multiple people, a couple of partners I get to count two or three whatever. So if I could get a company a day with three people working at it and that's a thousand right here, right there. And I want to have in five years. I want to have ten thousand millionaires that we're able to build their business because of the tools, the ease-of-use, the quality, the reliability the feature set that they got out of Parsimony and they were able to treat it like the old Henry Ford plant where they had the great big drive shaft that ran all the way down the line. And every time they needed to do something they just went in and they threw a belt some conveyor belt to you again, transmission belt is what they call it and it's cotton. See they would throw their drive shaft would go down the length of the building and they would throw a belt over it and bring it down to a machine and they would use it to cut or to grind or to polish or whatever at whatever station they were at and that's a reasonable analogy for Parsimony. It is this huge drive shaft that goes through your whole business. It keeps track of all of your customer interactions from the time they're just leads and then opportunities and then customers and then service quest. There are questions and things like that. It keeps track of all of your orders in minute detail and rolls up into financials. It keeps track of all of your items and all of the costs and all of the changes and all this other. Anyways, this is if you want to work on items or if you want to work on marketing. If you want to work on financials or whatever, it's this drive shaft. You just throw a belt around it, connect it to whatever you want to work on and you can do it. And I genuinely believe that by doing that we let that tool do the work and then the individual entrepreneurs and offers that are out there can benefit because they can do what they're best at. Right? They're going to be able to get just the right texture to the body lotion that they're making or just the right blue to the iPhone case that they're making or just the right you know PPC campaign to launch their product or whatever they can do. All that will keep track of the dollars will keep track of the process, will make sure it's all tightly integrated and working and I think they can grow their business a ton. And then when they want to sell it they go “Here are the keys to the motor.” And I think that makes the company worth a ton right instead of saying okay I got these spreadsheets and I got these databases and I got these Word docs and I got this Evernote archive and there - that's how I run the business instead of saying, “No, here. I just gave you a user ID in Parsimony, you can go in and see all of it.”
Steve: Yes it is really an important thing for entrepreneurs in particular and Awesomers at large to try to figure out how to build equity into whatever you're doing. And the way that I've always looked at business is you start with strategy, you move on to systems and then you use the systems to leverage for scale. And one of the challenges, especially with up-and-coming emerging companies without a big budget, is they don't have access to world-class technology and that's really part of the point of Parsimony is to be able to deliver something that is sophisticated and what the big guys are using but let the little guys pay for it effectively. In other words, they can afford it.
Steve: And that is something that is not today delivered. And I love your big vision because it really is all about adding value to the folks out there and it is a really important gauntlet to throw down because so many people need systems and it's challenging because systems bring a level of comprehensiveness which brings complexity and those things have to always be balanced.
Michael: Yes. We've done this before, we did it to grow our own businesses. I've done it at other businesses where I work. I've seen the power of it. I've got the experience and we’re going to put together a team that really cares about delivering overwhelming value to these folks and we're going to stick with them. So that they can get through this and learn the Parsimony way that these details matters. You got to track this stuff because that's adding value and information and then making your business grow.
Steve: Yes. I totally agree. There's almost nothing more important to me when it comes to scaling a business than having the systems in place and then getting the team to operate those systems. That's actually the secret to scale and too often people get caught up into distractions that maybe this little thing or that little thing but it's not a silver bullet there. There's no silver bullet. It's just kind of a consistent long-term effort to utilize a systemic approach to doing business and nothing's ever perfect but trying to get as much as you can into one area seems like a really good move and that's our vision behind Parsimony. And I'm glad Michael’s on the job by helping us out. I can't wait to see those ten thousand millionaires out there using Parsimony come true. So how do we find you online Michael? Not necessarily you directly but how do we get in touch with the company?
Michael: So Parsimony, P-A-R-S-I-M-O-N-Y.COM is there and you can learn more about it. There's a discussion forum if you want to come in and ask some questions and stuff like that. My email address is email@example.com and you can always reach out to me. I'll reply as quick as I can.
Steve: Yes. It's it's nice to be able to have the president accompany you, still be able to talk to folks and get it before it's gone because schedules get booked up. But I will say this, a lot of people ask you know what does Parsimony mean and I've talked about the philosophy of Occam's razor a number of times also known as the law of Parsimony. Actually, most people pronounce it parsimony I believe but we've adapted. I tend to make up words Awesomers not necessarily my own incarnation but adopting our made-up words as some I like to do and my definition of parsimony is kind of doing more with less. Right? We all as entrepreneurs and Awesomers need to get more done but without more time invested, without more money invested. We need to leverage the thing and that's really the heart of what Parsimony is all about. Don't you agree?
Michael: Absolutely. That's what we're trying to do and we know it works. Right? This is not our first time down this road. We've made all the other mistakes, we've had all the other failures. We know what the right answer is. And now we just want to make it available to 10,000 folks so that they can grow their business.
Steve: Yes. For those keeping score at home. When I talk about my first million-dollar day attempt it really comes down to utilizing. It was actually called Parsimony although this is a more modern incarnation using a system so that we don't melt down. Versus one of my very early days in 1999 selling online. That over the course of two weeks we did $40,000 and it brought us to our knees we had to take the phone number off the website, we melted because we weren't ready to scale over just a simple $40,000 in 14 days and several years later by putting systems in place we were able to set a goal and end up accomplishing more than a million dollars a day. And we'll talk more about that another time. So the systems really are the key to scale once you combine the team along with them that can use the system. So that's really good. Michael how about any final words of wisdom for the Awesomers out there?
Michael: Yes. Go take action, do something, get into motion, go be an athlete, be an artist, be in love, be somebody, be yourself and then strong. You've got muscles, you've got strengths put them to work. Don't be afraid of sweat. They leverage what you've got to make a difference. Go be strong.
Steve: Well said, Michael. I appreciate you joining us today. Thank you for taking the time out.
Michael: Oh happy to do it and would love to talk to anybody that's got other questions about anything. I love helping folks out.
Steve: Yes, no doubt about that. We'll have my colonic in where we dive a little deeper into the Awesomers authority segment where we talk about what does the software do and why does it do it that way and get into more detail but I sure enjoyed filling in some of the blanks on the origin story that I didn't know and we'll talk a little bit more but first we'll be right back.
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1.00.39 (Steve shares his closing remarks.)
Steve: Well. Michael story is certainly something that I always find inspiring and I just really appreciate the fact that he's been a part of so many different companies and was able to make an impact in each of those companies that helped their growth. Michael’s understanding of finance, as well as marketing, is unique and something that I think is very helpful to entrepreneurs around the world and really his leadership for the Parsimony.com company is something that is absolutely to be respected, admired. If you haven't already, check out Parsimony.com you should go and do that now but don't forget that we have the show notes at Awesomers.com/15 because this is episode number 15. And now it's a good time to go ahead and subscribe, like, share it with a friend. Heck, you can even leave us a review if you want.
Well, we've done it again everybody. We have another episode of the Awesomers podcast ready for the world. Thank you for joining us and we hope that you've enjoyed our program today. Now is a good time to take a moment to subscribe, like and share this podcast. Heck, you can even leave a review if you wanted. Awesomers around you will appreciate your help. It's only with your participation and sharing that we'll be able to achieve our goals. Our success is literally in your hands. Thank you again for joining us. We are at your service. Find out more about me, Steve Simonson, our guest, team and all the other Awesomers involved at Awesomers.com. Thank you again.