The Birth of Palisades

 

I've been extra busy lately and not overly creative, so just to stoke the writing fires, I'm gonna cheat a little with regards to the overall theme of the blog and look at starting my first business.

For those of you who didn't know me then (or maybe knew me but didn't know my work life), I founded my first company in the summer of 1994. I had spent all of two and a half years in Purchasing at Diamond Comic Distributors and was a complete expert and ready to sell my knowledge.

  

I left my Diamond job in June 1994, just after helping to run the Diamond Retailer Seminar--it was a pretty big trade show for the industry but was only open to retailers. In those days, we had more than 3,000 comic retailers descend on Baltimore. In addition to my Purchasing job, I volunteered to take on as much of the show as I could, which at least according to my memory, was significant.

Palisades Marketing was born in September, following a summer of mountain biking and adventuring in New Mexico, Utah, and Colorado. Ironic that 21 years later, with a wife and two kids, I ended up moving here! I traveled out this way with my brother (he's a teacher with summers off) by plan. The Diamond Seminar was in June, so we left shortly after. We had a solid two months to roam around the west and see what we could get into. I have a collection of photos like this one. In many regards, it's my life overall. Always on the edge. Always pushing the boundaries of my comfort zone.

Dead Horse Point in Moab, Utah. For some reason, we never wore shirts that summer!

After a really fun summer, it was time to get to work. I wrote up a business plan (strictly following a business plan template in some book). Literally wrote it out on paper by hand. There were no such things as online templates or tutorials then. And honestly, I was just gonna wing it, but my oldest brother (a true entrepreneur, in every sense) made me write out a plan. As a 25-year-old, I didn't quite see the value but it was assigned to me and I followed the rules. To be fair, he also warned me that he was going to rip it apart and that process would not be fun. It wasn't.

The original business model was Marketing Consulting. I basically just traded on the relationships that I had built at Diamond and helped some of those companies sell into that distribution channel. For whatever reason, the comic distributors' sales cycle was this unsolvable mystery for many non-comic publishers. So I found this little niche in working with a handful of these companies. I also knew enough that I didn't want to just be "Mike Horn, the old Diamond guy," so I created that Palisades brand name.

By the way, I used to get asked about the name a lot. It's not inspired by Palisades Park, New Jersey nor Pacific Palisades in LA area, but rather for a cliff area at Squaw Valley, CA. When I started skiing in the late 80's, The Palisades was THE barometer of courage and ability. It's been a while since I have even been to Squaw, and the conditions have to be perfect for it to be open, but yes, I have made it down a couple of times. Not the same line as the pic below, mind you. Just surviving The Palisades is an accomplishment!

Late 80's vintage Palisades photo. No, that skier is not me. I swear I do have some photos somewhere but probably in a shoebox still. 

So I set up an office in the other end of the bedroom. I commandeered an executive style desk from my brother's office (that thing weighed a TON), ordered a couple of phone lines (I had to have a Fax line in addition to a voice line in order to be legitimate), bought a PC, and started making phone calls.

You see, at that time, I was 25, renting a townhouse in Baltimore with my brother and another friend. I was unmarried, with zero debt. My car was paid off. I had no mortgage. No kids.  I basically had the financial goal of earning $1500 or so per month. I don't remember the cash part exactly, but I think it was easy but not super easy to get it going. (I plan to expand on this thought in a later entry--the whole concept of a "Lifestyle Business.")

I didn't have a ceremonial "First Client," per se, but had a couple of manufacturers who had me handle the comics business for them. Again, at that time, there were about a dozen distributors who covered the comics and trading card market. I knew the rhythm from my Diamond time. Basically, I would gather product information and send it out to the various distributors, wait about five months and then collect orders. I had one client (honestly cannot remember who at this point) who insisted on being billed hourly. So I made up an hourly rate card. I had one or two who put me on retainer.

Sometime in that first couple of years, I was doing a market study report for Mattel. They had taken on a license with Top Cow to create toys on their comics, namely CyberForce, which was pretty big at the time. My job, as the "industry expert," was to look into the viability of building a business around these types of brands. Essentially, comics that were not Marvel or DC. For some context, especially for any not familiar with the comics industry of the mid-'90s, there was a massive surge in "Independent" publishers. Image Comics, Valiant, and a bunch of others. And it was big business. Some of these titles were selling hundreds of thousands of copies per month.

I thought this was THE coolest statue! Part of the inspiration to get into the sculpted collectibles business.

Anyway, at the end of the day, I went out to LA (El Segundo, for those who are not familiar with Mattel) and made a presentation of my findings. It wasn't a very formal presentation, but it was in one of their conference rooms on one of the top floors. (Funny aside, I remember being somewhat astonished by the fact that there was a softball league within Mattel. Like, 3rd Floor Barbie vs. 8th Floor Hot Wheels this week. For a guy who left a company of about 300, partly because it felt too big, this was mind-blowing)

I don't have a copy of the report anymore; never occurred to me to keep that kind of thing, but the gist of it was that there was indeed a business in these so-called second-tier titles. The guy who requisitioned the report was head of Boys Toys at the time (Matt Bousquette; he later went on to become the President of the company). In that meeting, he told me, "I agree that there's a business here, but I don't think it's a Mattel business. If I were you, I'd try to do it myself."

This was the gas on the fire that I really needed. I was already migrating towards being a maker instead of just a marketer. I was watching the action figure market exploding. It was a combination of the traditional toy makers, some up and comers (ReSaurus comes to mind), and Todd McFarlane, who had shunned licensing deals and struck out on his own.

But probably the single biggest game-changer was an engineering development in China. Huh? You see, up until the mid-90s, action figures were produced using giant steel molds ("Tools" or "Tooling") that were designed to produce millions of units before wearing out.  In that era, some factories found an alternative material (Copper Berillium) that was softer but did the trick--with the caveat that they would wear out after about 100,000 units. Demand for these comic titles (and others, but the Indy comics were leading the way) showed there was a market. Again, a business, but not a Mattel business. Relatively unknown brands like Warrior Nun found an audience. And with a production quantity reduced to tens of thousands instead of millions, a new niche market was borne.

We did NOT produce this figure. But it helped pave the way. 

Palisades got in on this in those early days. Through a partnership with long-time friend Nick Barucci, we developed an action figure for the Joe Quesada/Jimmy Palmiotti owned Ash. Here's another funny aside from the development of this product. The sculptor, Shawn Nagle, shot a video on VHS and overnighted it to us for review. That's a hell of a long way from digitally sculpting today, a little more than 20 years later!

Getting a COVER to Lee's was big time!

We also used to sculpt what we called a 2-Up. Basically, double the size of the final product so that all of the detail could be captured in the tooling process. The 2-Ups also made for better photos.

Michael Renegar and I, proudly showing off the original 2-up before sending it off to China

We sold a decent amount (no idea on the quantity any more) and took our lumps in the toy business, learning all kinds of lessons, from manufacturing to marketing.

We had made a deal with Wizard magazine for the clear version ("Smoke Edition") to be sold exclusively in the debut issue of their toys offshoot magazine, ToyFare. But during the process, Dreamworks had made a deal to develop Ash into an animated film and the Wizard publishers decided to pull out of the deal, fearing that this might derail the film and their "real world" toy aspirations. Reasonable decision at the time, albeit painful.

Some other time, I'll pick up the story about how we grew from that single action figure...

How Much of a Factor Does Luck Play?

I was trading texts with an old friend after my "Self Reflection" post (by the way, that is a VERY rewarding component of this endeavor--just getting direct feedback that these posts are not only being read but that the content is connecting somehow). He's going through a similar career and life exploration, partially caused by an unexpected change of plans in the company he's been working for.

Not necessarily as a cheerleader, but I mentioned how he had busted his butt in the early years to land a coveted job at a high profile entertainment company. (By the way, I'm being intentionally vague here because 1. It's his story and not mine and 2. It's really the situation that is relevant anyway) He says to me, "That was pure luck."

Which got me thinking about the role that Luck plays in our lives. Capitalized intentionally for emphasis. In some regards, it's an actual proper noun.

My response to my friend was, "You put yourself in position to receive good luck." That's more than a catchphrase or slogan. I truly believe in this. In his case, it absolutely was not pure luck. He moved to New York, took on any job involving a camera that he could find, and made it clear to his entire orbit that he wanted to be in the business. The specific job that resulted from a perhaps lucky encounter only happened because he was driven to be in the space and was in the right place to take advantage of that lucky break.

I look at my own career path. I got my first career job at Diamond Comic Distributors in late 1991 (I started in mid-December, so effectively, it was 1992. In a bit of life foreshadowing, I got the job, worked about a week, and then had a week off for a previously planned ski trip out west somewhere). But how did I get that job? I had answered a classified ad in the Baltimore Sun with my resume--the posting was for "Trading Card Buyer," or something similar. With my family background in comics and cards in the 70's and 80's, I at least had some knowledge of the general world I was attempting to enter. As it turns out, I was actually the second choice for the job. Some time after I was hired, my boss, Tom Stormonth, told me this. I don't recall the context but probably just some casual conversation over a beer. Had the original candidate taken that job, who knows where I might have landed? I was actually interested in pursuing some kind of career in outdoor sports.

The point of that story? My hiring was the direct result of luck. But had I not submitted my resume and had at least a second-best interview, I would not have been in position to take advantage of that luck. What I did with that position and the subsequent career path was up to me, of course.


I regularly listen to the podcast How I Built This With Guy Raz. https://www.npr.org/podcasts/510313/how-i-built-this. It's a series of conversations with all kinds of entrepreneurs (many of whom are self-described accidental entrepreneurs--a parallel term to my entire premise here) and he is a great conversationalist. Highly recommend. Anyway, towards the end of every interview, he asks his guest(s), "How much of your success is attributable to hard work and how much is luck?" I have yet to hear one who does not credit some significant portion to luck.

I can come up with all kinds of other examples in my own journey:

• I was lucky to be at a friend's party in Baltimore when I ran into a girl I sort of knew in college. That conversation has led to a lifetime together.
• I was lucky to be introduced to a series of people who prompted me to go to Japan in the mid-90's for several different, unrelated business opportunities. Those trips were not only professionally rewarding but some of the most amazing personal trips in my life. 
• I was lucky to be invited on a ski weekend in my senior year of high school. That two-day trip ignited a passion for the mountains that continues to this day. 
• I was lucky to be interested in producing toys right at the time that China factories came up with a technique to significantly lower the barrier to entry for manufacturing. That was at the same time that a generation of kids who grew up playing with Star Wars action figures were now young adults and wanted to have that nostalgic form factor but in other brands. Action Figures as Desk Ornaments. 
• I was lucky countless times in my career to be at some conference, trade show, consumer show (or bar in the after-hours) and meet someone who would later become an influence, partner, teammate, supplier, friend or some combination of the above. 
• I was lucky to have been able to move across the country, not once but twice, having amazing experiences as a part of those decisions. 

The commonality of all of those events? I put myself in the position to capitalize on those lucky breaks. And will continue to do so as I continue down the road. 

My mother always referred to me (lovingly, mind you) as The Golden Child. What she meant is that things tend to work out for me. I've gotten myself into all kinds of jams over the years and always find a way out. (It doesn't only relate to unjamming jams; she also meant that I've been able to make a nice life with a wonderful family and countless other positive aspects along the way) While that's a nice sentiment and in dark times can be a bit of a beacon of light, I also know that I can't rely on that luck. So I keep putting myself in favorable situations so that when that lucky moment pops up, I can take advantage of it. 

A Whole Bunch of Self Reflection

It's been a very challenging year, yet also a very rewarding one. Part of the genesis of this blog has been the self-reflecting that I've done with a pile of milestones in the past year.

• Turned 50. Unlike any other "milestone" birthday, I actually cared about this one. Probably the cumulative effect of the other factors on this list, of course. Also, as a side note, I skied on both the final day of my 40's and the first of my 50's. This is particularly notable since my birthday fell on Memorial Day weekend this year!

Arapahoe Basin on Memorial Day 2019. 

• My wife Kate also turned 50 this year. Technically, it was in 2018, but in this same general window. We were 25 when we started dating. Half our lives together!

Turns out, this is the only photo we took on her birthday.

• Had our daughter graduate high school and move out for college. We had nearly 18 years to prepare for this, but it still seemed like a shock. At the age of 50.



Top Pic is graduation from High School (May 2019). Bottom is moving into College (August 2019)

• Punted on my last company and started a consulting business. There are many ways to look at this, but frankly, I've learned (sometimes the hard way) that failing at business is as important as succeeding. More on that in a future post. The relevancy to the self-reflection motif is that I was back to a career reinvention. At 50. With a kid moving out to college. 

A biz friend refers to me as the "Get Shit Done" guy. So I built a brand around it.

• My son was struggling in traditional public high school. Super intelligent kid who just was not interested in school. We were pulling our hair out trying to figure out what to do with him. We were able to enroll him in an experience-based school (part of our county's public school system), but we did not know he had a spot until a week before school started. He's doing amazing and is back to the engaging, energetic, bright young man we had lost for a while. All that while dealing with a career reboot, a daughter moving out, and turning 50. 

Maddox upon his return from the mountains. Backcountry backpacking trip that is required to graduate!

Okay, so maybe this isn't a massive pile of events, but for the first time in my life, I was even aware of a "big" birthday. And don't get me wrong, I'm not whining about turning 50 nor was it particularly painful. I just got to be self-reflective in this past year or so, which is really unusual. 

I looked at colleagues and their careers, tinted by the lens of my experience. Should I have taken a more traditional career path? Would some of our struggles have been avoided? Or would they be replaced by different ones? 

One friend of mine was a 20+ year veteran at Sony. He had one of those really fancy titles: Senior Executive Super Duper Vice President or something like that. Then one day, "We're going in a different direction." Boom. Out. Was that route any "safer" than the one I took? 

All of those factors provided the fuel for this series. What if I'm not the entrepreneur that I've thought I've been all these years? Am I just painted into a corner where that's the only thing I can do? 

I actually tried to morph into a "traditional" career about eight years ago. I had "sold" a business at the time (I use the quotes since it was really an Acqui-Hire--my company was breaking even so I effectively traded it for a job) and moved with the family from our Maryland home to San Diego. When I got to Mad Catz (makers of video game accessories--my company was in the business of licensed t-shirts, mostly based on video games), they had no idea what to do with me. Literally and metaphorically. I showed up after driving cross country and the office staff had no idea who I was or what I was doing there. I didn't even have a desk. (SIDE NOTE: I think I'll tell the long-form version of this in a future post) After seven months, I was laid off. The only job job that I had held in 17 years and it was gone. 

The point of that little interjection is that I actually did try to go back into traditional employment.  Talk about discouraging. My "resume" looked like this: Founder (12+ years), Founder (5+ years), VP Merchandise (7 months). I couldn't even get recruiters to return my calls. AND, this was in Southern California. On paper, I'm unemployable but in reality, I'm one of the best team players I know. 

So am I forced into entrepreneurial life? Am I destined to be in this? Are there others who feel similarly? Turning 50 or not, that is the basis for this exploration. 

Can You Be Entrepreneurial But Also Work For a Company?

I would say this is THE most common example of what I have called the Semi-Entrepreneur. Why is this? Well, the fundamental roots of the entrepreneurial spirit are in the concept of betting on yourself. Let me give some high profile examples:

• Howard Stern. Like or hate him, he is undeniably successful but at the same time, he's never been the stereotypical entrepreneur. He didn't found Sirius. He's an employee. An incredibly high paid, powerful employee, but an employee. He created a style, created a brand, and built a team, but all within the confines of an existing company. 
• Tom Brady. If you don't like Brady or the Patriots, insert the team sports athlete of your choice (I separate out team sports since the players are essentially employees, utilizing the platform--the various leagues, to build their brands and careers). The leagues exist without each individual player and no player is bigger than the league (I'm talking to you, Antonio Brown). They have a symbiotic relationship where neither can exist without the other, but at the end of the day, these players are high profile employees of their teams. NOTE: I'm not discounting these guys nor am I talking about how many of them platform into more traditional entrepreneurial ventures. Magic Johnson famously owns a number of businesses. LeBron James as well. In my early career, I dealt with Drew Pearson Enterprises, which was an NFL licensee, producing a variety of official NFL merchandise. 
• Mary Barra, CEO of General Motors. Took an entry-level job at GM at age 18 and worked her way to CEO. Numerous posts along the way (including some Disney time), earning her way to the lead of one of the largest companies in the world. 
• Johnny Ive, Apple. Designer and executive and the guy credited with all kinds of Apple products from the iMac to the iPhone. He's leaving Apple for presumably more entrepreneurial ventures, but his success and credibility were built inside of an existing company. Having joined in 1992, he wasn't an original founder, either. 

I've listed only four here, not to call them out nor to suggest that these are the only four who qualify, but just to keep the list from getting out of control. I suppose I could take on an exercise where I just list as many well-known people as I can, but you get the point (at least I hope you get the point).

I do not denigrate these individual's contributions, mind you (I am typing this post from a MacBook, with my iPad and iPhone sitting nearby!), but to further prove my theorem that a Semi-Entrepreneur can thrive in the right environment.

After all, it's the entrepreneurial SPIRIT that is the driving force! 

For many years, whenever I added team members to my various companies, I sought out this attribute. Only I didn't actually identify it as such. It's only been recently that I even really recognized this common trait. To me, I was just looking for "self-starters" and "self-motivated" people who wanted to be part of the cultures that I was building. 

But the main point of this post: Can you be entrepreneurial without being an entrepreneur? I think that it's an employer's responsibility to find and nurture this spirit. Harness that energy by providing the very thing that puts the SEMI into Semi-Entrepreneur. It's the balance of some kind of security/stability/support with the participation in success. Whether that's purely financial or adds in some recognition or even fame, it's this combination of factors that will really maximizes the spirit. 

My brother's company, MasterPeace Solutions, https://www.masterpeaceltd.com/,  (which I'm on the board of, by the way), employs this very tactic. The topline summary is they work in the Cyber Security space. But their model (developed by my brother) is that they encourage their engineers to develop products (by products, I mean stand-alone software solutions) that can be spun out into separate companies. The engineers get to be creative, develop the products, and participate in the success (there is an equity pool for the creators), all while maintaining a salaried position. This is the very definition of Semi-Entrepreneur!

Last thought for this one: As I write this, I realize that this post can certainly be expanded into a much longer analysis. Hell, maybe even a book by itself. As this series evolves, I will certainly adapt the rules. Is it moving the goalposts when it's my own game?