Posts tagged Financial Management

King Nerd: How Robert Stephens Founded And Grew Geek Squad

Thanks to Robert Stephens, I still have a job.

About 18 months ago, I was on deadline for a major story when my computer screen turned a bright shade of blue. My first thought: Call Geek Squad. About 15 minutes later, I was inside a Best Buy talking to an ‘agent’ at a speed easily faster than that of John Moschitta, Jr. (of the mid-80s Micro Machines commercial fame). I was panicked.

The employee calmed me down and, after about 45 minutes of investigating my hard drive in the back room, came out with a fixed computer and all of my files saved. I could have kissed this agent. Instead, I ran home, finished my story just before deadline, and ended my day by relaxing with a glass of wine. Thank goodness for Geek Squad.

Fast forward to this week. While attending a conference on Tuesday, I met King Geek himself, Stephens. Since my run in with the ‘blue screen of death,’ I’ve been wondering how the company got started, how it became so well respected, and how it is now partnered with a brand as big as Best Buy. So, I sat down with Stephens for a little chat.

Humble beginnings

Growing up in Chicago, Stephens loved taking things apart and putting them back together. After high school and a few years at the Art Institute of Chicago, he transferred to the University of Minnesota with the goal of starting a career in computer science. In between classes, he used his hobby to help pay for his education.

“It was 1991 and I would ride my bike to people’s houses and help them fix their computers,” he says. “I rode my bike for the first six months of my business—I was 130 pounds and ripped—I remember making a house call on Halloween in three feet of snow.”

As word spread and Stephens became known around the Twin Cities, he began thinking of a concept and brand for his business.

“When I knocked on someone’s door, I felt like I was on Dragnet because the person inside was always in a panicked state; it was my job to calm them down and I had to be a detective to figure out what going on,” he says.

Stephens wanted to bring humility and humor to the brand, and the idea of a ‘geek’ coming into a home wasn’t intimidating—especially to female clients.

“I built Geek Squad to be female friendly. I didn’t want people to feel dumb when they didn’t know something, I wanted them to feel smart and that we could help make them smarter,” he says. “I also wanted the brand to communicate unspoken traits such as humility. For example, ‘I know these things because I don’t get out often and at least you have a social life.’ That disarming humor helps build trust.”

Stephens combined the Dragnet theme of a ‘squad’ with the humble ‘geek’ persona, and, in 1994 at 24 years old, quit the University of Minnesota and launched Geek Squad.

The big leagues

The distinctive geek mobile (black and white with a circular sign) attracted a lot of attention—only helping the business flourish. The beginning wasn’t all easy, though. According to Stephens, it was difficult to figure out what to charge when starting out. When he didn’t have the resources to grow his employee base, he charged more. Price increases helped to manage flow and also garnered the respect of potential clients.

Over the years, he did add employees—many which came from Best Buy. Meanwhile, the chain hired Stephens to act as tech support on television commercial shoots. “They allowed me to get to know the people who worked there and they were always a great customer,” he says.

Six years in, Stephens was operating a robust business and looking to expand. He considered franchising, but the model didn’t feel right. He also considered building his company to thousands of employees, but knew it would take forever to scale. So he went after the big fish.

“In 2000, I called up Best Buy—I wanted to take over their service department,” he says. “They liked the idea. We dated for two years and got married in 2002.” Last year, Stephens was named Best Buy’s Chief Technology Officer.

What is the future of Geek Squad?

According to Stephens, the company will continue to flourish thanks to ongoing advances in technology. He says robots will soon be fixtures in households to help with day to day living, and “they will have to be maintained and programmed.”

Does Stephens plan to launch any other businesses?

“There are millions of companies I want to start, but Best Buy is reinventing itself and every 90 days my job feels like a startup; that is just too juicy of an assignment to pass up,” he says.

Advice for SBOs

Stephens’ advice to budding entrepreneurs: Be thankful you don’t have money.

“You want to be a savvy customer of any services before spending,” he says. “Before hiring a PR firm, do you own PR—you will realize what is good and be a better consumer to PR firms.”

The same goes with advertising agencies. Starting out, Stephens didn’t have a dime to throw at an ad budget, so he did it on his own. Today when he hires a firm, he knows exactly what to expect, and admits that that knowledge makes him a tough customer.

He says, “Not having money can be a real blessing.”

Written by Katie Morell

5 Questions To Ask Yourself Before Acquiring A Competitor

Great companies are often made better by great acquisitions. If you’ve been salivating over the competitor down the street, you may be in luck. In today’s economy, businesses are looking to sell and it can be a good time for those in the market.

Before biting the bullet, consider these five questions:

1. What are their numbers?
2. Will customers cross over?
3. Will the acquisition help your existing client base?
4. Do you have the capacity to continue a strong revenue stream?
5. Why is the other company willing to sell?

Read more tips on ensuring a successful acquisition on OPEN Forum.

4 Ways To Increase Prices And Have Your Clients Happy About It

Prices increase and just about everyone hates it. But, if you are like most businesses, the economy is killing you and you are going to have to increase prices sooner or later. And, let’s be honest, if you wait until later, you will probably go out of business.

It’s the nature of the business. Prices increase for a variety of reasons, including market conditions, competitors and the rising prices that you are paying. But rather than slapping on you new higher price (see that as basically slapping your client), there is a much better approach. And when done right, your customers will be thanking you for the increase.

Here are four ways to increase your prices that will not only prevent your customers complaining, but may in fact get them giving you high fives:

1. Honesty is the best policy
2. Throw in a little extra
3. Offer an alternative
4. Ask their advice

Read more tips from Mike Michalowicz here.

The Top 5 Group Buying Sites: Love ‘Em Or Hate ‘Em?

Group discounts make the most sense for new venues looking to get the word out, those with economies of scale that make it less expensive to operate at higher volumes, or establishments with a realistic expectation of upselling coupon-holders.

To maximize success, social media experts recommend tailoring deals to encourage repeat visits, such as buy-three-get-two-free, offering customers incentives to redeem vouchers during down times, gathering e-mail addresses to stay in touch, and tracking buying patterns.

At one time, Yelp, Facebook and Google were all jockeying for a piece of the group-buying market. Recently, Facebook decided to shut down Facebook Deals after only four months, and Yelp has scaled back its deals function amid competition. Smaller, niche businesses may want to get their feet wet with more targeted deals sites, since the bigger players typically offer less favorable terms.

The techie blog InfoGenra recently released the top five deals sites based on Alexa rankings, popularity, sales and visibility. Here are the pros and cons of each.

1. Groupon
2. LivingSocial
3. Woot
4. Eversave
5. BuyWithMe

What group buying site is your favorite?

3 Strategies To Stay Afloat In Trying Times

I’ve recently discovered three brilliant—and easy—ways to improve the financial position of my business, but I’ll get to those in a moment.

First, let’s talk about why these simple changes are important. The global economy has been hurting for years now and the expected turnaround has taken longer and been more drawn out than most people anticipated. For small business owners, this new economy offers loads of opportunities, but it also brings a mountain of struggles and challenges.

To overcome these challenges and build profitable businesses, we need to focus on clear and effective business practices. That said, here are three quick changes that could save your business.

1. Use checklists
2. Hire interns
3. Develop a new cash flow positive revenue stream

Read James Clear’s flushed out tips and strategies here.

4 Business Tips That Can Save The World

A few years ago I read an article in the Harvard Business Review that created a proverbial whack upside the head. Titled A Road Map for Natural Capitalism, the article explains that we ignore one major capital component in our financial models: the value of Earth’s services, nature’s capital contribution to our success.

We just don’t think about—much less figure into our budgets—things like water storage, atmosphere regulation and the other life-support services because Mother Nature is the vendor. These services have huge economic value. Some, in fact, are priceless because there’s no known substitute. But because we don’t count them among our resources, or for the most part haven’t considered them at all, they’re being liquidated.

Here’s the deeper issue: when resources seemed boundless, low per-capita productivity and a relative scarcity of workers drove innovations in technology and processes that led to increased productivity (the Industrial Revolution). Today we have lots of people and labor-saving machines, but natural capital is disappearing. In the same way the Industrial Revolution replaced agrarianism, a new era of natural capitalism, or whatever future historians decide to call it, will inevitably transform the way we do business now.

…Read more on OPEN Forum.