Q&A with Stephen Adele, Adjunct Professor of Business Management
This spring, Stephen Adele, Executive MBA candidate, Spring 2023, will teach a new class of his own design: “New Venture Growth: Scaling Beyond the Startup.” As a lifelong entrepreneur, Adele has founded, built and sold multiple companies, including iSatori, Inc., and QuickBox Fulfillment. He served as CEO of QuickBox, where he grew the company to over $100 million in less than four years, and currently sits on the Board of Directors.
The E@DU team sat down with Adele to discuss his new course, the risks and rewards of entrepreneurship, and how an entrepreneur unveils the “why” behind their ventures.
Q: Could you tell us about the last company you built?
A: Absolutely. I am currently an executive board member for QuickBox Fulfillment, which I started here in Denver with four other partners. It now has operations in Atlanta, (Wayne) New Jersey, and we just acquired a fourth facility in Los Angeles. The company does third-party storage, packing and shipping services, primarily for middle market e-commerce companies. Basically, when you click the “buy” button from many popular online brands, we are the company that has the product, packs it and ships it through our unique logistical system. We vertically integrated the operations into the manufacturing and inventory management component for our clients, which was a real competitive advantage for us.
Once the company started in 2016, it skyrocketed very quickly. We ended up selling that company to a private equity firm called Pike Street Capital, up in Seattle, in November in 2019. At that point, I stayed on to manage the company’s continued growth for 18 months, when we brought in a new CEO that transitioned into my role. That led me to going back to school to get my masters—I’ve always been a lifelong learner. So, I went into the Executive MBA program here at DU.
Q: How has DU’s EMBA program led to the development of your new Spring 2023 class?
A: Through the EMBA program, I have talked to several professors about one of my life goals: being able to teach and give back wisdom to the new generation of leaders. I have been guest lecturing for DU for the last 10 years. In that time, there are several professors I have become friends and acquaintances with. These connections helped support the development of the brand new course I’ll be teaching this spring: “New Venture Growth: Scaling Beyond the Startup.”
How do you scale a startup? If your company’s product already has a product-market fit—in other words, you have designed something (product or service) that has market approval—that is prerequisite number one before you scale. Number two: you have a business model that is proven to work, and that is sustainable. The course is designed to focus on what I refer to the five pillars of scaling, which are strategy, structure, people, process/systems and cash. We have some all-star guest speakers, experts in each of those areas, slated to come in for the class as well as a curriculum designed around in-class discussions surrounding this model and various case studies.
I am super excited to work with our up-and-coming leaders. I have learned so much in my EMBA course, especially from my peers. I want to pass along wisdom from my experiences, but I do not want to understate the importance of listening. I’ll be learning from the students, too.
Q: What is the “why” behind your entrepreneurial journey?
A: Many entrepreneurs tend to get hung up on the “how” of starting a business. But the “how” it is not really the hardest part, right? You can read books, talk to experts, bring in consultants that can show you how to achieve various things. When starting a new venture, you have to honestly ask yourself: are you trying to make a lot of money? Or, to build a sustainable business? Do you want to be altruistic? To be famous? There’s no right or wrong answer here, it’s personal. Though its vitally important to know this going in, so you can design your organization in such a way that it helps you achieve this overarching goal.
But the why is what is going to drive you and get you excited, get you up every day, and keep you moving forward in the face of obstacles. I have been a serial entrepreneur from as early as I can remember. We grew up in government-subsidized apartments here in Arvada, and my mom would clip the spider plants that grew rapidly. She put them in little Styrofoam cups with soil, and then built this little case to put around my neck. I would walk from apartment to apartment, selling the plants around the apartments for one dollar each. That was my first taste of entrepreneurship—or rather, figuring out how to create value out of something. I knew nothing was going to be handed to me, and as such, my why has always been proving to myself that I can in fact create value in the world that people (or businesses) are willing to pay for, and I have carried that through multiple businesses.
Q: What was the “why” with QuickBox Fulfillment?
With QuickBox, the “why” we started with is not the “why” we have now. The founders, all four of us, had serendipitously ended our previous ventures at about the same time. We saw the opportunity, we had the original idea, and we took our collective experience to build it and, eventually, sell it. At the time, the end-goal was to build a company valuable enough for someone else to buy. Like with the World Cup, and Messi finally holding that trophy, that was his “why”—the ultimate end-goal. So, selling the company was the “why” we set out with… and our World Cup trophy… but, selling the company didn’t feel like the right “trophy” for me.
With QuickBox, right away, we encountered a unique problem: the company was highly dependent on people. It is a large workforce, much of which is entry level manual labor — when I was there, we had over 550 employees. There was a consistent turnover rate—nearly 100%—inside of six months. It was really bothering me. What were we to do? I tried playing around with different perks and incentives, but most experts just told us, “Ah, this is the warehouse industry. Just live with it.” It was demoralizing, and it was expensive. But I have a practice as CEO: walk the four corners of the building, every day, and talk to the people. “What are you working on?” Not to be interrogating—just trying to understand, to hear people’s stories. Doing this, I found a common denominator with those who had stayed the longest: they were people we had given a second chance. We just didn’t know it when we hired them. Recent immigrants, recently incarcerated, recently homeless, battered women, disabled veterans, etc.
Once we identified this common denominator, I worked with HR to build an outreach program around Denver. I said, “there is something here. We give individuals a second chance. In return, they give us the reciprocity of hard work, commitment and loyalty.” It worked. And beyond that, it transformed the way we saw ourselves as a company. The “why” became something new. We became Colorado’s largest second chance employer. The “why” became, “what does this do for our community? How do we build these people from unskilled labor? How do we develop skilled labor individuals, who can become managers that either stay with us or move on and become a manager somewhere else?” We wound up building this huge mission, and it became our tagline and mantra: “fulfillment on a mission.” On our website, we have a calculator that shows, based on how many orders we process in a day, how many people we can hire through our Second Chance program. People (prospective clients) said, “I want to be a part of that.”
We still ended up selling the company, but the “why” existed well beyond what we intended. Now, it really is the ethos of the company.
Q: Pursuing a new startup comes with its share of uncertainty and risk. What risks did you face in your life as you launched QuickBox, or one of your previous startups?
A: One question that always comes to my mind is this: “is an entrepreneur born, or made?” I’m a little more on the side of, “you’re born with it.” I have distilled four qualities down of what makes for a successful entrepreneur. Number one: are they willing to take the leap? What is your risk tolerance? When you are younger, it is a little easier to make that leap into entrepreneurship and starting a new venture. You have fewer obligations; you might not have a mortgage and kids. I remember the first business I started—it was extremely risky. I had to borrow $25,000 from a friend of the family. I maxed out my parents’ credit card. I had to say, “I am willing to bet on myself.”
I remember a whiteboard we had in our little cubicle office. I wrote on there, “failure is not an option.” I was determined to make this work. That being said, that same sentiment was tampered with. If something doesn’t work, that’s okay—I’ll just try something else. I think risk has to be balanced with the ability to understand that you might fail. And if you fail, are you okay with that? Are you willing to try again? Most people are fearful of failure, and they get hung up. They thus don’t end up taking the leap.
With QuickBox, I had a more comfortable situation: I had just taken a company public, transitioned out, and sold quite a few shares. But I was still willing to risk money and time on the effort. And the partnership with the individual owners helped, too. We very much balanced the risk between all of us, and we were willing to bet on each other. The risk was still there, but our skillsets balanced each other out, and it helped our collective risk tolerance. Thankfully, it turned marvelously well.