Entrepreneurs often become emotionally pleased with their companies. “It is my baby,” an entrepreneur might say when describing his firm. He might talk of”growing his infant” or”protecting his baby.”
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But not Rohan Gilkes.
“There is no emotion,” he told me. “I don’t have any babies. I build companies for the money flow. If someone approaches me and says,'[Here is the amount ] I’ll provide you,’ I will calculate it. If it works from a mathematical perspective, then I sell it. It is all based on the metrics and the information.”
Gilkes’ success speaks for itself. Wet Shave Club, a subscription company, he founded and then sold. Launch27, a SaaS platform for service companies, he founded and sold. Maids in Black, an on-demand cleaning supplier, he set up with $450 and owns — with earnings exceeding $15 million.
He and I recently discussed his trip. What follows is our whole audio conversation and a transcript, edited for clarity and length.
Eric Bandholz: We’ve got a lot of catching up to do. It has been five years since we last talked.
Rohan Gilkes: Thank you for having me. I have been working in all sorts of companies since then. When we met in 2015 I had been working on Wet Shave Club — a subscription box for shaving goods. I have since sold that and started other companies.
Bandholz: You began your entrepreneurial journey providing maid services to the local community, right?
Gilkes: Yes. That’s how I began. I wanted to create a maid service which felt like an ecommerce shop: pay by credit card, complete the transaction online, and do all of the conversion optimization stuff that people typically associate with ecommerce. I called it Maids in Black. I got into the first million dollars in like 18 months. It was insane.
Everything is simple except the people element. Getting clients, the technology, the promotion, all that stuff was natural to me. However, it’s been in, and I haven’t solved the employee-people component. Butstill, it is done well. We crossed $15 million in earnings.
It is now on autopilot. I have hired a general manager, an assistant manager, service staff.
Bandholz: How can you grow these multi-million dollar companies?
Gilkes: I concentrate on one at a time. When my first one got large enough — like $3 million each year — I hired people to run it. And then I moved on to another Item. When that got large enough, I sold it. It looks like I am like juggling a great deal of things, but I am really doing them one by one.
Bandholz: How can you know whether to maintain a business or sell it?
Gilkes: It is based on the cashflow — a mathematical choice. There is no emotion. People ask,”How do you market your baby?” I don’t have any babies. I build companies for the money flow. If the cash flow is correct and if it’ll be consistent for another 20 years or so, I am happy with that.
However, if somebody approaches me and says, more or less,”You know what? I can move that future cash flow into the current, and here is the number I will give you.” I will calculate it. If it works from a mathematical perspective, then I sell it. It is all based on the metrics and the information.
By way of instance, I built a software firm called Launch27. I just sold it last year for eight times EBITDA — essentially eight times cash flow — that was $2.5 million.
Bandholz: Then you are ready to use that money for other projects.
Gilkes: Exactly. I have never raised a cent or borrowed money. I just cash-flow this up. Some fail. Let us be real.
Bandholz: how can you know when a company is failing, once you’re throwing good money after bad?
Gilkes: I start companies like I am poor. My first business I began with $450. That is all I had. So even now, when I think about starting a company, I am searching for something I can begin for what could have been one or two weeks’ salary. I am not putting $100,000 into a small business. I am placing like $2,000 to $5,000 to it. So if it does not work, it does not work. I am never going to lose my shirt because I began it at a very modest manner.
Bandholz: your present job, Jasmine, is a market type of business.
Gilkes: Yes. I like community building. It opens all kinds of opportunities. Sometimes I can figure out what I am wanting to sell before I build the community. But often, I create the community first and then decide what to sell.
Jasmine came from helping people put together courses and ebooks and electronic products and understanding that they needed the market to offer them on. You will find marketplaces out there currently. However, I felt like I could do it in my own interesting manner. And that is what led to Jasmine.
Bandholz: How is it different from existing options?
Gilkes: I wanted to eliminate transaction fees. I wanted a place where people can come and, for very low flat rates, sell their goods with no burden on transaction fees. And I also wanted recurring earnings, which I am after in all of my projects. Instead of simply selling one ebook, authors or creators can purchase a subscription, which covers everything that they produce and upload to the platform moving forward. So those two things are what people wanted. And that is what we built.
We are still pre-beta. But we have collected a few million signups in probably three and a half weeks. It has been pretty wild.
Bandholz: Do you have partners in your companies?
Gilkes: My first company, Maids in Black, I started on my own. Every other business I have constructed successfully was with a spouse. I bring on people who have skills I do not have but have a fantastic work ethic. I give them a portion of the company. I could have 50 or 60 percent of a watermelon as opposed to 100 percent of a grape.
Bandholz: Is it always only one partner? Have you got the exact same partner in numerous businesses?
Gilkes: It is generally 1 partner. I have built two companies with one individual. Then I have built two other companies with just two other partners. Again, I search for a individual with abilities that I do not have. I am not a techie or a web programmer. For my software company, I caused a technology person. With a different business, I caused a social networking guy. So it just depends upon the sort of business I am building and where there is a weakness.
Bandholz: How do you find these people?
Gilkes: In the communities which I constructed. That’s another advantage of constructing a community. I am able to reach out and say,”It seems as if you are good with this specific thing. What do you think about this project?” And they’re like, “Let’s do it.” Very often it is like that. So everyone I’ve worked with comes from a community that I’ve built, and I have been talking to them for decades before we ended up partnering.
The ownership divide is generally 51 percent (me) and 49 percent (my spouse ). So I am giving up about half the organization. If the individual has the ideal sort of work ethic, if it is someone I wish to speak with each day and spend some time with — if these things exist, then I am comfortable, and we get to work.
Bandholz: You mentioned another job you are also working on, beyond Jasmine.
Gilkes: It is Named Dreamdesk — Dreamdesk.io. It picks up where Launch27 left . As I was working on Launch27, I noticed lots of small home service companies used nine or 10 platforms to handle their operations, such as Grasshopper (for mobiles ) or ActiveCampaign (for email) or Basecamp and Trello (for collaboration). With Dreamdesk, we are consolidating all those tools in 1 platform.
Bandholz: Your companies tend to spawn different businesses. You do not start from scratch every time.
Gilkes: Exactly. If people listen to me for something, that is it. My first business was to rescue myself from not having an income, being laid off. Every other company grew from that.
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