Meet Eric Crown
I had the great opportunity to meet with Mr. Crown, former founder and CEO of Insight Enterprises. He graduated Arizona State University with a Computer Information Systems degree. With only a credit card cash advance, he was able to launch his business of buying and selling PC’s at 22 years old. At the age of 29, he took Insight public and brought it to a billion dollars in revenue a few years later. His company was listed in the Fortune 500, and Inc recognized Insight as one fastest growing companies and best places to work. Currently, Mr. Crown invests in several companies and spends his time in the entertainment space. Recently, he was the executive producer for the movie Teenage Mutant Ninja Turtles.
Questions I ask:
- What did you want to become when you were younger?
- When did you find your passion?
- What was your first major sale?
- What were some of the marketing channels used by your company?
- Did you have a proof of concept before jumping into the business?
- How did being a Computer Information Systems major at Arizona State University helped you grow Insight?
- Do you believe in traditional schooling, especially in our current society?
- What are your thoughts on going to college for a specific skill set?
- What were some common traits that you saw within your employees?
- What are some future trends that you’re looking into or spending your time on?
- What motivated you to pursue the film industry?
- What was your best and worst business investment?
What you will learn:
- Mr. Crown’s story from his college years to taking his company public.
- The sales risk their company made that led them to know Insight was a viable business model.
- How they used catalogs and magazines to their advantage
- Why they switched their customer base and products
- An easy and cheap way to test an idea or product’s proof of concept
- How Mr. Crown outsold everyone over the phone and attracted better sales leaders
- Mr. Crown’s educational path
- How he was able to sell to people much older than him in their 50s, while he was just a college graduate
- Why you should go to college to learn a technical skill that others may not have
- New trends that Mr. Crown is spending his time on
- How the opportunity to purchase the Teenage Mutant Ninja Turtle’s franchise presented itself
- His thoughts on China’s film industry
Watch our interview with Eric Crown here:
Questions asked in the video and their responses:
What did you want to become when you were younger? Had entrepreneurship interested you at that young of an age?
I think most young entrepreneurs have some desire to be successful. Whether its in the confines of traditional business or out on their own. As I started to go through college, I took a traditional approach. Then, in the last couple of years, I decided I wanted to start my own thing, which is when I decided I wanted to become entrepreneurial.
Was this a passion you had as a younger child or was this passion found in your years in college?
If you go back long enough, when I started college, the PC had just become invented. I attended college and focused on the main frame part of the world. When I got out of college, the mid-80’s was the time of the explosion of the Microsofts and the Intels of the world. That’s basically what I got into—the manufacturing of PC’s, and the sales of software and hardware to mainstream America. It was first to the consumer, and now it’s to the business-user. Insight still sits at Fortune 500, with offices in 30 countries and $5 billion in sales.
Walk us through the story behind how you got started after college.
The story is like a lot of those fun stories of entrepreneurship. I started with an education in college and one of my classes was in Entrepreneurship. The class required you to write a sample business plan or business that you would pursue. I wrote one that roughly resembled what I wanted to do—the buying and selling of PC’s. The joke goes I got a C on the paper. Quite literally after the graduation of college, I received in the mail one of those neat little things from a credit card company that said, “Congratulations Graduate, you can get a free Visa card.” I got the Visa card, and had a free $2,000 cash advance. I quickly went down to the bank and cashed it—got my $2,000 cash advance. That was fundamentally the money I used to start the business for the first five years. After five years, we raised a few dollars and took the company public. We were a billion dollars a couple years after that. The first five years we were in business, we were one of Inc’s fastest growing companies.
What was the first major sale that you got that showed you there is a lot of potential for your business?
As all businesses, we stumbled a long a little bit—buying and selling products. Getting the legs underneath the business. Some of our very early business was in mail order—placing an ad in a magazine, prior to the Internet. We would wait for calls to come in. I remember that when you place the ad, it would take 4-5 weeks before that ad would come out. We bundled a few thousand dollars that we had, which was all of our money at the time, to place an ad. We knew computer hardware was selling at the price of the ad, but we priced our product just below what we were buying them for at the time, hoping prices would drop. While were waiting for the ad, the prices did drop. We were praying people would dial our number, as soon as they saw the ad. What was amazing was we had to sell hundreds of them to survive. Within days we had sold hundreds, within weeks we had sold hundreds more, and within months we had sold thousands more. That’s when we knew we were onto something. From there on, that was the “sale thing” that worked for us. We found the perfect model that worked for our business.
What other marketing channels did you look into?
Our business in the beginning was based all on ads and magazines, and to consumers over the phone. We changed the business to catalogues. We’re becoming one of the largest cataloguers in the United States. Eventually, we switched our business model from consumer to business-user to the Internet to outbound sales forces. We went from people taking phone calls to people making phone calls. People would be dealing with business professionals on the other end. These sales people were making over a million dollars. In the course of 15 to 20 years, the business switched its customers, method of sales, products, and its geography. So for any young entrepreneur, it changes all the time.
Did you have a proof of concept before marketing or advertising?
I’m a believer in going straight into the business. As a lot of things like those ads, I believe if you can’t give it away for free or very cheap, then you probably won’t be able to give it away for a profit. I was willing to sell below my costs, hoping prices would drop. It’s a great way for all young entrepreneurs to find a proof of concept. Try giving it away for free.
In the early stages, how did you get those sales people on your team?
You have to sell you way to greatness. You either have to be really clever or inventive, or sell your way to greatness. You can never do it by cost-cutting, which simply supports sales. A great sales goer overcomes so many evils. Marketing to me is a function of sales. A well-written ad or a well-written website can explain all of the doubts, and sales helps push people over. In the beginning sales was used as an informational tool. People didn’t understand computers. They said, “Help me. I need…” We were able to solve their issues. Afterwards, it became about the speeds of things. However, the real answer to the question is that I was on the phones. I got on the phone in the morning and I outsold everyone in the room. Pretty soon, better sales people came along and people learned from them. We would hire 50 salespeople a week with a large salary.
Did the Boiler Room resemble your business back-in-the-day?
Near identical. I’m not a big believer in scripts. I believe in helping give people tools, but you have to be adaptive. You have to know your client, giving them goods and services, while overcoming objections. Having an answer to each objection is part of it as well.
How was being a CIS major at ASU help you in growing Insight?
It really helped having a computer information degree. People didn’t understand PC’s to the cutting-edge level. They didn’t understand the industry. I will say one of the biggest successes in business is getting a well-rounded education, first in business. I never knew I would have to sell shares and devalue a bond. I never knew I would have to do finance, research, human resource, or marketing—that was invaluable. Nonetheless, the ability to connect to customers much older than me was invaluable as well. I was a young 22-year-old kid, hustling people that were 50 years old that didn’t believe in me. However, because I was also taking classes in art history, English, and political science, I was able to hold a conversation with them. It gave me the credibility that allowed me to show my experience in business, which allowed me to show my experience in technology. That led to persuading them to selling me the product, buying the product, or whatever I needed.
Were you involved in any organizations in college?
I was involved in some, they are not as strong as they are now. I was involved with some entrepreneurship groups.
Do you believe in traditional schooling, especially in our current society?
Probably for a lot of people, college isn’t the right thing. Burdening yourself with a couple hundred thousand dollars in debt for a degree in romance poetry, probably isn’t going to get you somewhere. However, if you do get some experience in some hard technical aspect, like I mentioned, then it’s important in a lot of business. Some of the harder things of business—accounting or statistics might be more valuable. Formal education, for the most part, I’m supportive of it. Watch your expenses. I worked my way through college. I moved here from out of country—military base. I came here and had a job for the summer, which paid enough to pay for tuition. The experience I learned in education was the experience I learned in day jobs.
What are your thoughts on going to college for a specific skill set?
I’m a big believer in going to college for something. Just getting a degree in general business, won’t get you very far. There’s a lot of people with general business degrees. It has to be some specialty, whether it’s to be a scientist, an engineer, or even a doctor. After that, you have to learn how to be successful in that specialty. Most people that are successful in business are usually around an opportunity or an underserved market. For me, it was the same thing. I was a programmer, who realized nobody understood the PC. People would ask me to do programming for them for a few hundred dollars, which then they would use to make a few thousand dollars.
What were some common traits that you saw throughout your employees?
The energy, the desire, and the enthusiasm to work hard. We tried to get people, who were smart and had the ability to learn quick. At the time, no one understood our product or industry. So, I was looking for a young guy who driven, smart, and he could learn. We were a very energetic company. Forbes or Fortune names us one of the coolest companies in America to work for.
Did you ever hire any of your colleagues?
Not so much. I needed people who were older, especially for sales. I took a company public when I was 29. I had to hire people much older—in their 30s.
What are some future trends that you’re looking at right now or would advise others to look at?
The areas that I’m spending a lot more time on is the entertainment space. I believe we’re having a greater desire for free time. The movie business to the music business. Basically, things that people spend their leisure time doing. My most recent venture, I was the executive producer of Teenage Mutant Ninja Turtles. I unearthed that brand. We were able to parlay it with Paramount, and do a billion dollar play.
What motivated you to go into the film industry?
The opportunity presented itself. We’re looking to presently expand into China, which is the second area I’m spending a lot of my time. China will be the number one film market in the world in 2016 most likely. It will outpace the United States. We’re looking to launch a film studio in China of substantial nature. They only allow 34 foreign films into the country. However, you can do co-production. There are certain avenues that we believe present an opportunity for success.
Can you discuss some other investments that you’ve made?
We’re looking into some biotechnology that we’ve spent several years developing. Without long, we should have it out into the market. Another investment would be the application of capital—people needing capital in the micro-ticket space.
What was your best business purchase or investment?
The one that I made the most money on that didn’t end that well was in the defense space—body protection. The company was called AmorWorks., which subsequently was forced into bankruptcy. It was hundreds of employees and very profitable.
What was your worst business purchase or investment?
My most significant failure was when we went into golf. With the large downturn, golf took a tremendous hit. We did customized golf clubs. It was very successful and was used by a majority of all professionals. It was very profitable. However, it was one of the most easily expendable activities people could do. During the downturn, they stopped golfing. They certainly weren’t going to buy a new bag of clubs. It was a very successful business that suffered from a long downturn from the economy.
If you’d like to get in touch with Mr. Crown or discuss possible investment opportunities, please reach him through his website or connect with him on LinkedIn.
Written and Filmed by Yogin Patel
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