188: Big Ass Fans: How Carey Smith Sold it for $500MM & How he's Helping Startups Today…

188: Big Ass Fans: How Carey Smith Sold it for $500MM & How he's Helping Startups Today…

Background on Carey Smith of Big Ass Fans:

Carey Smith founded Big Ass Fans in 1999 and served as its Chief Big Ass until the company's sale in 2017. Under his guidance, Big Ass Fans grew an average of 30% a year, with offices across the globe. It made the Inc. 5000 list of fastest-growing private companies 11 consecutive years — a feat achieved by only 34 others — and expanded from industrial products to include a line of chic, silent commercial fans. In less than two decades, he took the company from 0 to $250 million in revenue, without the help of investors.

Following his $500 million sale of Big Ass Fans, Carey founded Unorthodox Ventures, a twist on the overdone business incubator. He has tasked his small team of fearless millennials with finding ventures with big potential. The group evolved from a team dubbed “The Kitchen” at Big Ass Fans that developed big ideas totally separate from the company’s core business efforts, like how to prevent the spread of tuberculosis in hospitals in Rwanda and Haiti. And when Carey's team succeeds, they’ll profit, too, as they have ownership stakes in both Unorthodox Ventures and the companies they build.

Time-Stamped Show Notes:

[1:05] Carey Smith currently runs a venture capital business and he was also the founder of a fan company called Big Ass Fans, which he sold in 2017.
[2:57] Big Ass Fans started as an industrial fan, which eventually shifted into the commercial fan and residential fan.
[8:35] Carey talks about the prices of their fans, from industrial to residential fans.
[10:14] The venture capital firm that Carey runs today is not your typical VC firm that tries to own the majority share of a new company. He explains what his venture capital firm is all about.
[15:51] Selling Big Ass Fans for $500 million, Carey was able to start his venture capital firm.
[18:07] In 1998, Carey found some guys who built a very large fan to cool down cows, which led to the start of Big Ass Fans.
[20:45] When they changed their name from HVLS Fan Company to Big Ass Fans, it created quite a ruckus within the town but people loved it.
[25:10] Focusing on customer satisfaction paid off in the long run for Big Ass Fans.
[27:40] Carey offers some advice regarding customer feedback and product reviews.
[29:49] Diversifying and focusing on a new product was one mistake that Carey did during his time in Big Ass Fans.
[33:09] Carey gives a few important lessons and tips to the listeners.
[39:25] The hardest part of a business, according to Carey, is finding the right people to work with.
[42:57] When it comes to hiring people, Carey prefers the younger ones, especially millennials who haven’t worked for other companies for an extended period of time.
[48:52] Carey cautions business owners when setting up incentives and bonuses for their salesperson. He also provides some suggestions and examples on setting up these incentives.
[1:01:32] There are certain preferences that Carey is looking for when helping entrepreneurs through his venture capital firm called Unorthodox Ventures.

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Fabulous 4 Questions:

📖 📚 Favorite Book(s)? Yertle the Turtle by Dr. Seuss is my first and only business management book. The lesson is clear to any 6-year-old: Ignore the well-being of those who work for you, and you could find yourself waist-deep in mud.
🙌😎 Favorite Amazon.com purchase? I generally avoid Amazon other than to purchase books.
🌱💸 Favorite Tool that's GROWN your Business? It always amazes me how little office productivity software has advanced or improved over time. If I had to choose, it would be Excel.
💭💡 BIGGEST Challenge keeping your Business from GROWING? Maybe a listener could help you solve this issue… 💭💡: In the case of most businesses, a lack of thinking creatively is inevitably a problem. People like to be herded, and that's an issue especially when starting businesses. You should always be solving problems, and doing that requires engaging a lot of people and understanding different perspectives.

Key Point from the Interview:

“You have to be very careful about hiring people that work for other companies for extended periods of time. Much better in my estimation to hire younger people that are curious, than hire somebody that knows the ropes.”

Resources Mentioned:

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