Misfit Entrepreneur December 2023 - 382: From Courtside to Boardroom - Entrepreneurial Lessons from a Pro Athlete Turned Business Maverick with Adam House

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Dave Lukas Chats with Adam House

382: From Courtside to Boardroom - Entrepreneurial Lessons from a Pro Athlete Turned Business Maverick with Adam House

This week’s Misfit Entrepreneur is Adam House. Adam is a highly success entrepreneur and former professional athlete. Adam has started and built multiple entities to 7-figures and has had several 7-figure exits. He also is co-owner of a team.

Through his company, House of Bricks, Adam advises businesses and provides strategic direction where he blends his experience as an entrepreneur with his experience as a pro-athlete to help clients succeed.

And it’s this blend of experience that I really want to dig in on with him in this episode.

https://www.adamhousesr.com/

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Show Notes

When Adam was junior and senior year of high school, he had the opportunity to work for Dan Gilbert, the founder of Rocket Mortgage and Quicken Loan, now multi-billion-dollar mortgage company. He is was also the owner of the Cleveland Cavaliers.

It was 1996, and there were 80-90 team members at the time. Adam served as Gilbert’s intern and got a crash course MBA in what it was like to build, start and scale businesses, casting vision, getting people to buy into your crazy ideas as an entrepreneur, thinking anything is possible. Adam went to college and then dropped out after a year.

He started his first business out of my apartment with a few hundred dollars and turned it into a multimillion-dollar company. He then sold it in 2007 and started a mobile technology company. He sold that in 18 months at 30x revenue!

He was 32 years old and after some prompting from his wife, decided to go after his dream of playing pro sports.
He hired a professional basketball skills coach and began training. He was then invited to a combine in Dayton, Ohio. Despite being the oldest guy there, he did pretty well and ended up getting invited to the camp in Rochester, New York. He ended up making the team.

He did that for year, then started a healthcare analytics business that recently went public. Now, he uses his experience to advise entrepreneurs on how to grow at scale.

Sports are a business. What were some of the lessons you took away from spending a year in pro sports?

There's a really strong connection between being an entrepreneur and being an athlete or even just being in business
You have goals, you have accountability, you have discipline, you have to work within a team environment.
The team Adam was on had a winning culture and had won championships, so it had great systems in place which are critical for a business to succeed.

What is the one area that entrepreneurs should focus on the most to succeed?

The first thing Adam tells people to do is start making decisions
Aa lot of entrepreneurs get analysis paralysis and they had to just start the process of making decisions. Decisions create action, that action creates feedback and it helps you make better decisions going forward
It's not just making the right decision because a lot of bad decisions can lead to better decisions later on. It creates that data and feedback that you need to continue to make progress.

Do you have any thoughts on how people can become more decisive?

The first decision is go make a decision, whatever it is, do something, make it something small.
The other thing you can do is focus on making commitments and keeping the commitment. And that's how you build that trust and confidence in yourself.
Start with something small, get some quick wins in the morning, easy decisions, and it just starts that momentum throughout the day to help build your confidence.

Where are businesses, entrepreneurs challenged the most? Where is the biggest area that they should focus on to improve themselves that you find?

About 70% of your time as an entrepreneur, you're spending in what's called the struggle zone. We reframe reframe it and call it the growth zone.
Relating things back to athletics or really anything you're passionate about art, music, you're struggling. And that is where the growth happens. That is where the best ideas happen. That's where innovation happens.
As an entrepreneur or business leader you need to get comfortable being uncomfortable because you're going to spend 70% of your time in this area.

You talk a lot about building a foundation for success, but avoiding shortcuts. Explain what that means and why people should avoid the shortcuts.

It's something that Warren Buffett talks about, and others, but it's the compound effect
It's doing the small things every day consistently over time to make a big impact. Those are your foundation and if you skip them or neglect them, you will suffer.
Surrounding yourself with other successful entrepreneurs that hold you accountable is very important helpful
You also should reverse engineer how you want to get where you want to go by understanding your competitive advantage, continuing to innovate, to maintain that advantage, go to market strategy, and then foundationally, what is your corporate structure and making sure you have the right shareholder agreements, the right cap tables.
Adam says he’s seen entrepreneurs lose millions of dollars for not having the right share classes, liquidation preferences. He suggests that you should have monthly advisory meetings where your advisors would hold you accountable.
You should love being held accountable.

What are the principles that you have built your businesses upon?

In every business that Adam has started, he does all the work first.
He creates that bottom-up buy-in, even though he’s had a lot of success, even with he still does it the hard way because the more resistance you face earlier on, it goes back to strengthening that foundation.
You learn a lot about the business and what needs to be done.
“Beware of gimmicks. It's like everyone and their brother has a way to 10x your business. If I knew how to 10x your business in three months, I wouldn't need to be, I'd just be doing it myself. So, there isn't a magic recipe. It's just avoiding gimmicks, the compound effect, bottom-up buy-in, and then back to making decisions.”

Talk to us about your process. How do you work with clients? How do you help them? What are the areas that you focus on and that you find the biggest opportunity?

Adam’s engagements start with a 30 day, depending on the responsiveness of the client, discovery process.
The discovery process helps Adam see where opportunities are in the business across all areas for product to sales, marketing, finance, etc.
From there is becomes an action focused process for each area of the business.

What should people know about selling a business?

is not like putting your house up for sale.
You must make sure your financial model makes sense and that you have a path to get to where you want to go and then also create a growth model.
It is typically a minimum of a 12-month process, because you still have to run the business as well. Just getting prepared for that liquidity event.
You also need the time to do some house cleaning, strengthening the foundation, and then position your business for that rapid growth ahead of the exit.
It’s helpful having someone who's been through it to coach you, help you get ready, but then also having a good group that knows how to run a process. They'll help you maximize your dollar value.

Finding balance and harmony with your work and family is important to you. What are some tips you can give to help entrepreneurs in this area?

Adam has been married 20 years and moved my wife 22 times and she's still with him
As he says, “she is the real champion of the family and I have four amazing boys. Three of them are teenagers. So, for those of you that don't have kids that are teenagers yet, enjoy it because parenting becomes very different when you have three teenage boys and I have a 10-year-old. So, I love being a dad, love being a husband and creating an environment in my new company where we have that passion to really empower entrepreneurs. But at the end of the day, we all are working very, very hard and it's good to be rewarded for that financially. I mean, money empowers you to do a lot of things. It really magnifies who you are. So, we're very active in the community and giving with the finances that we have.”
Adam says that he’s learned that there are different seasons in life and you have to recognize them.
In each season, you have to communicate differently. For example, Adam’s wife knows what it means to be in “building season” when he is getting a business off the ground or starting with one. She knows what it takes and the long hours, etc. But then there is the Harvest where he doesn’t have to work a lot which has its own challenges. there are some downsides to that he can get into his wife’s Domain too much.
If you're reaping, maybe get more quantity with family, but are preparing for that next season.

What are some of the parallels that you see between sports and entrepreneurship that you feel are important?

The first thing sports can do is give you confidence that anything is possible.
When you accomplish things in sports that aren’t supposed to be possible such as making a pro team at 32 years, it helps you to see the possibilities in entrepreneurship.
It teaches leadership. In sports, you will have different roles as part of a team and one of them will be leading in some way. Sports gives great experience for this area.

Best Quote

Beware of gimmicks. It's like everyone and their brother has a way to 10x your business. If I knew how to 10x your business in three months, I wouldn't need to be, I'd just be doing it myself. So, there isn't a magic recipe. It's just avoiding gimmicks, the compound effect, bottom-up buy-in, and then back to making decisions.

Start before you're ready. Try things, test, fail, grow, repeat.

The compound effect. There are no shortcuts to success. There is no straight path to success. It's doing the little things every day over a long period of time. That is where you'll make a significant impact.

Without fear there is no opportunity. If you're afraid of something, you have to realize that opportunity and fear are two sides of the same coin.

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