Chapter 3

Rules for success

I often think about what contributed to my success.

When I define ‘success’, it’s not necessarily just about having a great financial outcome. Of course, that is why you start a company, but success is a lot more than just the money. We sold Com Tech to a South African company, Dimension Data (so our company, having started out as Com Tech, finished up under the name Dimension Data), for an enterprise value of over $1 billion in 2000. Possibly Australia’s first unicorn – but the word ‘unicorn’ was still only a beast with a single large horn back in those days.

Yep, we sold just before the dot-com crash. I told you I could write a book on lucky breaks.

Financial success is one of the reasons you take the risk to start your own company, but I’m just as proud that the company I sold in 2000 is still one of Australia’s leading integration companies. Several of the same management team who worked with me for many years are still in place. Some have been there for over 30 years. Boy, did we have a team. I’m proud that I still see people today who say that they have never had a better job than the one they had at Com Tech, and I’m proud that some of the world’s largest companies – including Microsoft and Cisco – still remember the mutually beneficial partnership that we enjoyed. In a later chapter, I will talk about our culture: we lived and breathed customer and staff satisfaction, and we treated our business partners as an extension of our company. It paid off.

So, what do I consider to be the reasons for Com Tech’s success?

Luck

Who would ever have thought that a skinny 12-year-old boy from Louisville, Kentucky, would become heavyweight champion of the world – and arguably one of the greatest human beings to set foot on this planet? When young Cassius Marcellus Clay Jr, later Muhammad Ali, realised that his bicycle had been stolen, he was furious and swore that he would ‘whup’ whoever stole it. When he went to report it, Joe Martin, a cop who ran the local gym, told Clay: ‘You better learn how to box first.’ Who could have imagined that a kid stealing Muhammad Ali’s bicycle would be the lucky break that kickstarted the career of the greatest boxer of all time? Of course Muhammad Ali trained hard, but if his bike hadn’t been stolen, would he have achieved the same success in another chosen career? Highly unlikely.

As I mentioned earlier, so many things have happened in my life that had any decision gone another way, I would not be writing this book. Everyone says that we worked hard. Of course we did. So did Jimmy at the corner cafe – he was at work before I left my house and was usually there when I came home. He was working hard, but he didn’t have the same success that I did – because, unlike him, I happened to be in the right industry at the right time and, importantly, had lots of lucky breaks (not to mention the fact that Com Tech executed extremely well).

One of the luckiest breaks was being signed up as Novell’s second distributor in Australia. Novell was the hottest company in the world at that time (1989). Novell country manager, Peter Stanford, had much easier options available than signing Com Tech. There were just three of us in the company, working out of a tiny terrace office at no. 72 Erskine Street, in Sydney’s CBD. We were one of 27 companies applying for the distribution agreement and we were not the logical choice – there were large public companies in the mix, well funded, well staffed. But none had the hunger and passion that Com Tech had. The easy decision was Tech Pacific; the right decision was Com Tech.

We never let Novell down. We invested heavily in both people and infrastructure to ensure that we enhanced Novell’s reputation in Australia. Peter said that if within 18 months we became as big as the original distributor, Datamatic, he would make no changes to the distribution channel. Within three months we were twice Datamatic’s size. We were doing 70 per cent of Novell’s business in Australia. Another lucky break was that Datamatic was so bad, we didn’t even have to be good (except that we were good – unbelievably good) to win business. They had abused the privilege of being an exclusive distributor and had no regard for customer service. They were my best salespeople – they did so much selling for us and I didn’t even have to pay them commission.

To my disappointment, six months after our appointment as the second distributor, Novell appointed two more distributors: Merisel, a giant US distributor, and Powerlan, a Melbourne-based distributor. Novell went from one exclusive partner to four distributors in six months. We never gave up any of our 70 per cent market share and the other three distributors shared the rest. Com Tech were lucky enough to have Datamatic as a competitor – Powerlan and Merisel had Com Tech. All three of the other companies eventually went out of business because they did not have the critical mass to hold enough inventory or provide the infrastructure to support a highly technical product, as we could.

Critical mass is critical – excuse the pun – in any business. Peter left his job a year later, but not because he had appointed Com Tech – we never let Peter or Novell down, and I have no doubt that we enhanced their reputation in the region. Peter was replaced by an older, more conservative, country manager – Arthur Ehrlich. Arthur was a great guy from the USA, but no way would he have made the bold decision Peter took in signing up Com Tech as the second distributor. It would have been too risky, and he wouldn’t have wanted to risk losing those valuable Novell stock options.

Hard work

I always say that it’s easy to build a company, but unbelievably hard to build a great company. It’s not what happens between 9 am and 5 pm that makes the difference, it’s what you do before and after normal work hours. We invested heavily in relationships: staff, customers and business partners like Novell. We were forever out for breakfast, lunch and dinner, building those relationships and earning the trust of our key constituents. Meetings, seminars, conferences – boy, that was hard. It didn’t take long before I thought my wife was shrinking my jeans in the dryer. I put on about 15 kilos during my time as founder of Com Tech.

Focus

I always say that to succeed you need to be as focused as a one-eyed dog in a meat factory. Once we became the Novell distributor, the whole world wanted us to represent their products in Australia. We said no to 99 out of every 100 opportunities that we were offered.

When Steve Jobs took over at Apple, he cut their product range from 100 to 4. They became the first trillion-dollar company – not a bad outcome. And to further prove my point, I can give you $39 billion reasons why I am right. In seven years of operation, Afterpay initially had only one product – pay in four equal instalments. Whether you were in Sydney, New York or London, same simple product. I have no doubt that the service has improved, the interface, the integrations, the ability to drive customers to their merchants, but on the whole it’s still buy now and pay later – the same product that revolutionised an industry. At the time of writing, Afterpay was only now ready to release its second product, Afterpay Money, to enable it to provide additional value to its very happy 3.5 million Australian customers. Focus on the significant few, not the insignificant many.

Team

You cannot build a great company on your own. I may not be the smartest person in the room, but I’m very confident at bringing the smartest people together. I employ people who are much smarter than me – but I’m not threatened by them. You have to surround yourself with an amazing, like-minded team who have not only the ability, but just as importantly the attitude, to differentiate your company from the competition. Later in the book, I dedicate a whole chapter to the importance of the team.

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