Building a Big-Ass Company for the Long Haul
Carey Smith, Big Ass Fans
March 07, 2016
I get approached all the time by people who want to invest in our company. But I don’t want to have to worry about what some knucklehead thinks I should be doing. I want to run my business in a way that makes me and my employees happy and satisfies our customers.
So far, we’ve managed to do pretty well without investors. My company, Big Ass Fans, brought in $224 million last year selling, well, big-ass fans for industrial spaces. We’ve also recently started selling residential fans and lights for industrial spaces. We’ve grown 30 percent every year since the recession and we expect that to continue — without outside investors.
It’s always been important to me to run my business on my own terms. When I started out in insurance in Dallas in the 1970s, I specialized in reinsurance, but I thought my company could build a nice new business insuring the local oil industry. My bosses wanted me to just keep doing what I was doing. I couldn’t get my brain around the idea of sitting in an office in Dallas for the rest of my life doing the same thing and looking out the same window. So I took a leave of absence and started my first company.
Sprinkool was a good idea. We set misters up on the roofs of industrial buildings to help keep them cool. Industrial buildings, where you can have thousands of people working at any given time, are rarely air-conditioned. There’s a real need for an efficient, cheap cooling system.
But I couldn’t sell people on the idea of Sprinkool. I still spent 10 years trying. At our peak we brought in only $1.4 million. That wasn’t enough to earn a living or grow a company. Our first company wasn’t really a business — it was an airplane we couldn’t get off the runway.
But that time provided me with an education in public relations, marketing and industrial buildings. One of the big problems with Sprinkool was that employees couldn’t see it, so there was no psychological benefit. But they could see a big-ass fan.
So in 1999 I started selling giant fans. Initially I tried to sell the fans along with the Sprinkool system, but people only wanted the fans. So I focused on that. I wrote articles for trade magazines about the benefits of big fans. Many buildings relied on small standing fans that employees fought over. A giant ceiling fan not only covered more area and eliminated those fights, but it used less electricity than all of those little fans going all day.
Customers caught on to the benefits and we were off and running. We grew quickly but I was able to shape Big Ass Fans into the kind of business I always wanted to work at. We run our business like a three-legged stool, which means we pay equal attention to the happiness and success of our customers, suppliers and employees.
We employ our own salesmen, which means we have a direct link to our customers. We know what they need and we make sure they are satisfied, even if that occasionally means earning less money. In many industries, suppliers often get treated very badly and that hurts quality. We make sure we treat our suppliers with respect and attention and that has helped us sell great products.
On the employee side, we encourage people to come up with new ideas and even new businesses. I don’t want anyone to feel like I did back in my insurance days. In fact, our two new business lines, Big Ass Light and our residential line, Haiku Home, were both started by employees. Work has to be fun and exciting and there has to be a bright future. If not, your best people will leave. We hire only about 1 percent of all applicants and we have an incredibly low turnover rate thanks to this philosophy.
I’m now building a 200-year company. I think about and plan for succession. It’s not the next generation I’m worried about. It’s the third and fourth. My goal is to build a strong enough culture, and a strong enough business, that Big Ass Fans will keep going, without investors, long after I’m gone.
Carey Smith is the CEO of Big Ass Fans