Uncommon Success
The average family business lasts 24 years. About 13% make the third generation while 3% survive a fourth generation.
What are the odds of surviving 125 years and five generations? Before answering, consider that your main industry declines more than 50% over the last 20 years.
These are the headwinds the Kaspar Companies in Shiner Texas has faced.
Kaspar Wire Works transformed a wire basket business into the most dominant provider of newspaper vending machines. Thirty years ago they commanded a 90% market share counting USA Today and the New York Times as customers.
Then the internet happened. Delivery of news completely changed. Twenty years ago, 46% of daily single-copy sales came via the Kaspar Sho-Rack. Ten years ago, vending machine sales fell to 20%; today they are less than 10%. Kaspar produced its last Sho-Rack in 2015.
Despite hurdles faced, the Kaspar Companies successfully and profitably pivoted. Given this, I was convinced this would be a great story on adaptation, innovation, and perseverance for my Texas Lutheran University students.
As such, it was an honor to host Jason Kaspar, CEO, and Peter Robinson, COO, to our campus.
Today, Kaspar Companies is the parent to seven businesses. Although Wire Works still exists, the collective company now manufactures and sells everything from truck beds to housing, outdoor equipment, ammunition, custom firearms and precious metals.
Given this, I was curious to know how Kaspar transitioned a dying business to the thriving, multi-faceted one of today.
Kaspar and Robinson led the discussion with eight lessons.
Lesson One: “Pursue your passion and let the path take care of itself.”
Early in his career Kaspar took jobs that underpaid him. He did so because it challenged him mentally and gave valuable experience that would later propel his career.
Stints in Dallas and New York exposed him to research analysis and bankruptcy workout opportunities. This led him back to Shiner to establish his own investment firm. He commented that in Shiner, he had cheap overhead and could think for himself. This is very reminiscent of Warren Buffett’s decision to leave New York and return to Omaha.
Lesson Two: Look for “Heads I win, tails I don’t lose much” opportunities. Kaspar added, “You must continually think in probabilities.” Having an opinion is not enough. You must have logic and information to make educated assessments. A great book outlining this process is Superforecasting.
Lesson Three: To be successful, create a discipline of continual learning. Early on, Kaspar set a modest goal to read ten pages a day. It allowed him to consume a book a month. This translates into 12 per year and 120 books per decade. If you want to get ahead, create good habits and be a lifelong learner.
Lesson Four: Play the hand you’re dealt, no matter how tough. Never give up on your game. Grit is the most undervalued characteristic in business and life. Life is not fair, but that should not stop your success.
Lesson Five: Practice your talent at work and home. Get to 10,000 hours quickly. This references Malcolm Gladwell’s book Outliers. To acheive expertise, you must devote 10,000 hours to practice and refinement.
Lesson Six: Systems run businesses, but people run systems. Build and improve systems to achieve long-term success. Develop a set of standards to create systems. Kaspar added that 94% of outcomes are due to systems and systems must continually evolve.
The Kaspar Companies, as a system, exists to improve people’s lives and wisely use resources. In the process, don’t be afraid of Big Audacious Goals. In 2019 Kaspar Companies set a goal of reaching a $1 billion valuation by 2043.
Lesson Seven: Always play the long game. The power of compounding overcomes any short-term win. Society continually trumpets “get rich quick mentalities.” However, slowly grinding with a long-term mindset is vital.
Lesson Eight: There is nothing you take with you when you die. Unless you have an eternal perspective, it is all meaningless. As such, transform lives together. Whether to employees or the community, Kaspar Companies distributes 10% of profits each year. They have a clear purpose and strategic plan to transform lives.
At a time when strong, ethical leadership is hard to find, it was reassuring to experience a masterclass in how to think, problem solve and treat people for sustained, long-term success.
Dave Sather is a Certified Financial Planner and the CEO of the Sather Financial Group, a fee-only strategic planning and investment management firm.
