Chris Koerner on 75 Businesses, Hard Lessons, and the CEO Playbook

I'm Chris Koerner, and I have a clinical addiction. That's my hook. I start businesses for a living. I'm not really great at managing them or selling them, but I'm really, really great at starting them. Zero to one is the name of the game. That means I have a lot of surface area for scars, scams, frauds, headaches, and stresses, which gives me a lot of stories.

I'm going to go through my career over the last 15 years, talk about some businesses I've started, and relate them to the role of a CEO at six, seven, and eight figures in revenue. I assume most of you will be buying or starting businesses in the seven figure range, so I want to cover the whole gamut.

This is a quick screen recording of all the businesses I've started. Some were very small, many failed, many were abandoned. Some grew to be six, seven, or eight figures in revenue.

My first business was called Phone Restore. I was a student at the University of Alabama, and I needed my iPhone fixed. I went into a dorm room, saw a guy fix my iPhone, and I thought, that's a cool business. Then I read articles about LSU students who opened a store fixing iPhones, doing $30,000 a month. So I signed a lease with a personal guarantee as a senior in college on a space right next to a Subway. It smelled like fresh bread all day. I called it Phone Restore. We grew to four locations and sold it. I learned a lot more in that business than I did getting my business degree or my MBA.

**1. Develop the MIH gene: Make It Happen.**

You have to develop that muscle. Everything truly is figureoutable. When I opened my store, I had never fixed an iPhone. People would walk in with a broken iPhone, and I'd say, give us a few hours. They'd walk out and I'd go to YouTube and learn how to fix their iPhone with their iPhone.

On April 27, 2011, a swath of tornadoes went through Alabama. Part of our store was in the rubble. Students were about to leave. We had just opened a second store but weren't profitable yet. Overnight, our revenue went to zero. I had a personal guarantee and a newborn son who's now 15. We had to make it happen. We went to Home Depot, put a sign up, people felt bad for us, we got some sales. We had a bunch of iPhones we'd bought back from customers that we had never listed on eBay. We listed those and we made it happen.

Right after I opened, I thought we were going to fail. People weren't coming in. One Sunday night, I was up in bed and had an idea. I don't drink. I'd never been in a bar in Tuscaloosa. But surely college students go to bars and get wristbands. Why can't I put my ad on a wristband? I pulled out my Dell laptop, googled custom wristbands, they were 2 cents each. I ordered a few boxes and distributed them to bars. College students would go to the bar, break their iPhone, get drunk, wake up with a broken iPhone and a wristband with my ad on it. They'd bring that wristband into my shop, and it changed the trajectory of our business until the tornadoes hit.

**2. Know the weeds.**

We talk a lot about whether you want to work in the business or on the business. You have to start in the weeds. You have to learn what they are.

Our fourth location was a kiosk in Parkway Place Mall in Huntsville, Alabama. One of my principles is test everything except drugs. A customer walked up with a $600 iPhone that just needed a battery. I'd fixed hundreds of batteries at that point. I started fixing it. The phone was really hot. I accidentally punctured it with my screwdriver, and black yellow smoke started spewing with a hissing noise from this phone in the middle of the mall, smelling like death. Everyone was looking at me. I was covered in sweat. I had a UPS box, threw the phone in, and closed it. We had to buy her a new phone. She lost all her data. That's a byproduct of having to make it happen. You screw up, but you learn a lot.

**3. Insulate your employees.**

You're one text or call away from your year being ruined. I was filling up gas at this exact pump when my employee Ryan called from Phone Restore. He said something terrible happened. Someone threw a brick through the window, grabbed all our phones and the cash drawer, and stole everything. Later I found out Ryan, my employee who made the call, was actually the one who did it. He made it seem like a break-in.

As a CEO, you have to learn to insulate your employees from stresses that are happening. Imagine the top of the funnel as your employees encountering stressful things. If they can handle it, you'll never know about it. Only the worst of the worst funnels down to you. You have to build resilience, and the only way is to expose yourself to all those stressful things.

The Caspian Sea is the largest lake by surface area. As a CEO, or CE-owner as I like to say for smaller businesses, you have a lot of surface area for stressful things. It's your job to insulate everyone else, because they're W2 employees. They don't have the same upside, so they shouldn't share the same mental stress.

**4. Cover your assets.**

If you're moving fast and breaking things, those things you break could be your employees' paychecks.

**5. Invent a rival.**

You want a shared enemy, a chip on your shoulder, even if it's manufactured. Even at home, when one of the kids annoys me, I'll be angrily doing the dishes. They've put a chip on my shoulder, and it's silly, but it gets the dishes done.

I sold my chain of iPhone repair stores by merging with a competitor. I was supposed to get one third of distribution checks in perpetuity. That happened for one month. They stopped sending checks because I had launched another business doing very well, and they didn't think I needed those checks. That became a rival, a stressor. We channeled it with the employees. It became a chip on our shoulder that helped grow that company to $2 million the first year, $4.8 million the second, $8.8 million the third. It probably wouldn't have happened without that rival.

**6. Capitalize the business.**

If for nothing else, to protect the employees who entrusted their paychecks with you. John Nolan, I went to church with him. I hardly knew him. I just heard he had money. He became a mentor. When I started growing my second business, LCD Cycle, very fast, I approached him for money. We didn't sign any papers. He gave me money, I paid him back. He said, I don't want any equity. Just donate whatever you think is fair to my nonprofit. I'm very indebted to him. Sales solve everything. Capital is fuel. If you run out of it, you run out of business.

**7. Take advice from the right people.**

Not everyone you take advice from will have your best interest at heart. People have pride and ego. John Nolan had done very well, and all his advice was unbiased.

I got a term sheet from a venture capital fund out of Birmingham. Believe it or not, there is venture capital in Birmingham, Alabama. It was $1 million for 20% equity, everything I needed to get through this growth phase. I prayed about it, and the answer was very clearly no. It was the opposite of confirmation bias. These were good guys. Eight years later, I re-looked at that term sheet and saw a very standard clause: liquidation preferences. The business grew very fast and then started shrinking. Had I taken that money, I would've had to give the first fruits of all my profit to that company. We wouldn't have been able to move to Dallas, build our dream home, and do many of the things that got us where we are. It took a full decade to learn that.

That's a summary of my six to seven figure lessons. Now, my seven to eight figure lessons.

I go to church with a guy named Keith. He owned a business called Heartland Bread, some of the best bread you've ever tasted, five ingredients, distributed only to DFW. I thought it was a crime this bread wasn't sold online. I told Keith, I'm going to sell this online for you. I'll pay for everything. If it works, give me a cut. If not, no harm. He said deal. We launched right before COVID. Sales went crazy. We leveraged that into starting a logistics company called Send Eats for e-commerce food brands that grew very fast during COVID.

My family also saw all 50 states in 60 days. Around the same time, I started a company called Better Exit, acquiring RV and mobile home parks. When you have 75 businesses in 15 years, you've always got a handful going at a time.

**1. Escape the spreadsheet.**

Everything looks beautiful in a spreadsheet. The famous Jeff Goldblum quote from Jurassic Park: your scientists were so preoccupied with whether or not they could, they didn't stop to think if they should. That's a mistake I made for over a decade. I'd have a business idea, crunch numbers, do research, reverse engineer competitors. This will work, therefore I should launch this business. I'm still fighting that urge.

With Send Eats, we signed a lease on a 10,000 square foot warehouse, took on a bunch of customers, were making $300,000 a month top line, not profitable, didn't know it at the time. Sounds sexy. Very stressful, very low margin. You're competing with Amazon. You either need $100 billion or to be the most expensive niche service. We were neither. We were in the messy middle.

We also bought a Bitcoin mining facility, kind of an acquisition, kind of a startup. Zero to $10 million profitably in three months. Zero to $15 million in 12 months. Right place, right time, peak 2021, money printing everywhere, China had just banned Bitcoin mining. It looked great in a spreadsheet. A year later, hindsight is 20/20.

**2. Protect yourself.**

October 2021 was the craziest month of my life. I had Send Eats with a 10,000 square foot warehouse and 32 employees. I had the Bitcoin mining facility blowing up. My daughter was very sick with a serious lung disease. We had to be medevaced from Dallas to Houston. I took a lot of sales calls from Texas Children's Hospital. My daughter ended up getting a double lung transplant a few months later.

I had a Send Eats customer who accounted for 85% of our revenue. I can hear you saying that's customer concentration. The funny thing about customer concentration is, what do you do? You don't fire the customer. You take great care of them and try to add more to drop the percentage. The owner of this company was the worst. I was in the hospital taking sales calls for the Bitcoin mining business and customer service calls with this gentleman berating me. We had to make the difficult decision to fire the customer, which meant firing 85% of our employees. It got ugly. But I was in such effort mode, thinking of more important things like my daughter, that it was actually a good time to do it. Like the airplane analogy, you have to take care of yourself or your employees will suffer.

**3. Protect the culture.**

Your business will be the lowest common denominator of your most toxic employee. You will know who that is. If you're wondering, it probably is, because you're thinking of that person for a reason. We had to let one employee go who was making my rockstar employees quit left and right.

If your rockstar employee has asked you for a raise, you're probably too late. Your rockstar employee shouldn't have to come to you. You should come to them proactively so they stay enthused and grateful. It's really difficult to turn around a rockstar employee who's already checked out.

Nick Saban coached for two years at the Miami Dolphins. There was a controversial article where one of his players was convulsing on the field, having a medical emergency. The headline said Nick Saban stepped over him and went to his office. Months later, they talked to the players and Nick Saban. He stepped over him because they'd placed him in the hallway, the nearest spot, and went to call the paramedics and the doctor while everyone else was freaking out pulling phones out. That taught me you have to be the captain of the ship, stoic, whether or not you feel stoic.

**4. Test everything except drugs.**

Almost every good thing I've come across has been at the end of the sentence, what have we tried? Almost everything. Mark Zuckerberg says move fast and break things. I'd say apply calculated pressure, because sometimes you break things that are pretty priceless and hard to reverse.

I was growing the mobile home and RV park company very quickly. We had a $50 million term sheet on the table, 100 times bigger than any other. I had two business partners, and it didn't go well. They wanted more equity. One day, completely randomly, they sat me down at a Starbucks 20 minutes from my house and said, you're out. Verbatim: we know this sucks, we know this is wrong, we know you're probably going to sue us, but we're going to do it anyway. That was a result of moving fast and breaking things. I had partnered with these guys hardly knowing them. I didn't do due diligence on their character. I'm grateful for the experience because I've gone on to buy more RV and mobile home parks with better partners. But it could have been avoided by applying calculated pressure.

**5. Beware of pride.**

Many of you know Nick Huber. He puts himself out there on Twitter. About 13 months ago, he tweeted essentially: everything's awesome, I've got all these businesses, everything's going great, I just can't miss. I had him on my podcast and we talked about that period. He basically said that was the local top for him. Things got really hard after. He said, I've been eating glass and staring into the abyss for the last 12 months. No shots thrown at him. He's a great guy. But I've had tweets like that. When you think nothing can go wrong, that's a signal. Conversely, when you think nothing could get worse, that's your bottom. Self-awareness of those points will serve you well.

**6. Know the weeds (continued).**

We own a tree trimming business. I have to know how to quote jobs, talk to subs, what price to start at knowing they'll negotiate me down, what our gross margins need to be, how to use Jobber. I need to know all that as the owner. But I don't need to do it forever or we'll never scale. Find the balance.

Michael Girdley tweeted: hire smart people, leave them alone. I'd say that's terrible advice. Andrew Wilkinson tweeted on March 5, 2020: your job is to do nothing. CEOs who actually perform duties within their companies are failing. Your job is to set strategy and culture, delegate and incentivize.

Using the extreme example of Elon Musk: Boring Company, SpaceX, Tesla. I firmly believe if Elon Musk worked on one company, that company would be doing better. He's still arguably the greatest entrepreneur ever lived, richest man on earth. But each of his companies is probably at 60% of their potential because he's splitting focus. That's fine, shareholders know. But if you're splitting focus like I've done for 15 years, you have to know the score.

This was Andrew Wilkinson's stock performance ever since that tweet. The answer between these two pieces of advice is: it depends. At the size of business almost all of us are talking about, if you hire a rockstar operator, GM, or CEO and don't check in with them a lot, you'll see them die on the vine. They don't think you care about them or the business. You've got four other side projects. At a publicly traded level, that advice might be the best. But at our level, any rockstar employee, you have to touch base.

That's my message.

**Q&A**

*Do you have a fear of failure?*

Absolutely. If someone tells you they don't, they're a psychopath or a narcissist. I feel more certain in my success the older I get, but I don't think fear will ever leave me.

*You seem to have intense enthusiasm. What are your fears?*

Everyone in this room is driven by their insecurities, from Steve Jobs to Elon Musk to a homeless person. The question is, are we self-aware of those? Are we fighting them? If not, those insecurities might break us. If so, they could make us awesome. My insecurities: that my family won't be close, that people will think I'm a failure even if I'm not. I care what people think about me as much as I wish I didn't.

*Why do you keep starting little businesses instead of doubling down on winners?*

All else equal, you'll win bigger if you focus on one thing. But if you stay in the game, compounding doesn't care how many times you switch. We always discount compounding of experience. I'll test Facebook ads, Klaviyo, Snapchat, and learn all these things. Then you start an old school business that's never tried Facebook ads, you try it, and you win. We focus too much on binary compounding like an investment. I'm going to win either way, and I'll have a lot more fun starting things whenever I want. I'll never really have to retire because it feels like retirement today.

*Which business was the biggest financial success?*

Probably LCD Cycle. When we sold our iPhone repair stores, I noticed there was no good distributor of iPhone repair parts. I saw a big hole in the market. I started it the day after I sold the repair stores, and it blew up fast.

*What happened with the Bitcoin business?*

We still own it. We were conservative compared to our competitors. They were buying and opening new facilities. I'd been in crypto since 2016 and said this is going to come crashing down. It did. We kept our cash, but we were only conservative compared to our competitors, not compared to how we should have been. All those profits were quickly gone within a couple years. Had I been more self-aware earlier and pivoted to a marketing-heavy, operations-light company, which is one of my strengths, we could have been thriving today.

*What are you most excited about right now?*

I have a barbell theory: all AI or no AI. All the smart entrepreneurs are going toward AI, while home services say, hey, we still need our toilet fixed. The guy who would have started that business is launching a wrapper for sourdough bread. I'm very bullish on AI. I don't think it's comparable to crypto or mobile. I don't think it's a bubble. I'm also bullish on the other side of the barbell: home services, sweaty startups, anything fully offline.

*Do you see opportunity for searchers on the AI side?*

I don't see a lot of opportunity for a searcher to buy an AI business because it's so early. There's more opportunity in taking 20 to 30 hours to learn these AI tools and start something, rather than buying.

*How did you talk your wife into 50 states in 60 days?*

We were on the same page. After our daughter got a double lung transplant, we talked pie in the sky about doing it. The transplant was successful, so we said, let's do it. It was the best two months of my life, hands down.

*How's your daughter today?*

She's doing great. She just turned 13 last week.