In this episode of The Inner Chief podcast, I speak to Joel Holland, CEO of Harvest Hosts on why unhappiness is a requirement for entrepreneurialism, switching seats from CEO to Chair, and buying versus building a business.

Joel is the CEO of Harvest Hosts, a membership program that connects RVers (caravaners) with unique overnight experiences at 5,000+ wineries, farms, breweries, museums, golf courses and other interesting destinations in the US and Canada.

Earlier in his career, after stints in investment banking and in media organisations, he founded Storyblocks, the world’s first stock media subscription service, which was purchased by private equity firm Great Hill Partners in June 2020.

Joel has been named one of the “Top 25 Entrepreneurs Under 25” by BusinessWeek Magazine, and “Young Entrepreneur of the Year” by the United States Small Business Administration, and “Entrepreneur of the Year” for the Greater Washington DC Region by Ernst & Young, and also recognised on the Inc. “30 Under 30” list.

When he isn't working, Joel is outside as much as possible with his family in Vail, Colorado. He is proud to be a member of Vail Mountain Rescue, the search and rescue team for Eagle County.

In this episode we talk about:

✅  How in high school he hosted a show where he interviewed celebrities, athletes, politicians and Fortune 500 CEOs, including Arnold Schwarzenegger and Steve Forbes.

✅  Switching seats from CEO to Chair at Storyblocks, and why burnout forced such a move.

✅  The incredible operational principles which help him achieve success but also balance in life, and

✅  How he took Harvest Hosts from a solid business and on an explosive growth trajectory, and why he suggests building a business first, and buying thereafter.

Deal hope,

Greg

Thanks to former guest, Shane Russell, for introducing me to Joel.

Connecting with Joel Holland

You can connect with Joel via LinkedIn, and you can view the Harvest Hosts website.

Books and resources

• Storyblocks – a stock media company
• All Trails – an app for hiking

Similar Episodes on buying companies

• Jaimie Fuller, former CEO of SKINS on coping with rapid growth
• Julie Mathers, CEO of Snuggle Hunny on first-mover advantage
• Ben Simon, Partner of Rose Partners on diffusing heated negotiations and identifying red flags during a deal

“I feel that if you understand finance and economics, you understand how most of the world works.”

On lessons from his first venture

• That was just a good example of where your focus goes, your energy flows. I just wanted to make it happen and I worked hard to make it happen. I just willed it into existence. I was constantly dialling to get people on a show that didn't even exist.
• I learned that these people are just like us for the most part. They're pretty normal and had a good work ethic and they had a good vision for what they wanted to do.
• None of these career professionals were any better or smarter than I was necessarily. They were just maybe more disciplined, they did a good job of figuring out what they wanted to do in life and then working towards it.

On what makes an entrepreneur tick

• Probably a true definition of unhappiness is “never being satisfied”. And this is a typical thread for most entrepreneurs.
• I've often described entrepreneurship as a life of constant dissatisfaction. And ironically, that's what makes you a good entrepreneur – you're not happy with the status quo, so you build a business.

On creating Storyblocks

• I created an absurdly high value proposition for the customer right out of the gate, and it was a super low price for a really high value product. 
• So it made it a no-brainer for people to buy. And it was a membership product so they'd come back time and time again, they'd renew because they're getting value out of it.

On moving from CEO to Chairman

• That's human nature – we love progress in all aspects, playing games, playing sports, business. Progress makes us feel good. The question I never asked when I was younger was, “How do you know when enough is enough?” 
• One day I burned out because I just didn't care anymore. And I'd never really thought about what the end game was. These days I'm much more intentional about if I'm starting a business or any sort of project, what is the end goal?
• Candidly, I was totally burned out by that point. By 2016, I'd done too much for too long. I wasn't good at knowing what I should be working on and what I should be delegating to others. And I was trying to do too many things. A lot of them, things I wasn't good at and I hated it.
• I felt that I could still help if I were Chairman, but I shouldn't be operational. The Board agreed and it worked great. It was actually very scary to pull the trigger on that, but in hindsight, I was really glad I did it.

On building revolutionary products

• We loved using data. We had a cultural value: “We heart data.” We still have that value at my new company today, but I love doing A/B testing and multivariate testing on the website because we had a lot of traffic.
• An investor said, “This is all well and good, but you can't test your way into revolutionary concepts. All you can really do is iterative testing. But you're not going to get a breakthrough.”
• His example was Netflix – they didn't A/B test going from DVDs to streaming. I had basically gotten too down in the weeds on all the minutiae and I needed to pull my head out a bit and accept that sometimes big concepts, you have to just do them because you believe that they're going to work and they either just sink or swim.

On achieving balance in life

• The honest answer is by being really intentional about it. And this is a good example of what I didn't understand when I was younger when every day was just chaos. And I would just go through the day, putting out fires, answering emails, taking phone calls. And what I realised was that's no way to live, and also not a good way to have space for big ideas.
• I've always been super impressed with Warren Buffett above anyone else I've ever read about or learned about. And one of the things that he does is he likes to show people his planner and show them there's nothing in it, because he wants time to think for himself. The most important things are reading and thinking; it's not meetings.

On his planning routines

• Every month – and I've been doing this now for about 15 years – I do a personal board meeting with myself. And the idea was I used to go to all these board meetings at Storyblocks and they were always effective. I'd prepare for them. I'd get all the data pulled together for the month. We'd ask all these great questions. And every time I felt that it was a really productive use of time, so why don't I do this for myself? So now I do a monthly board meeting. I actually have a presentation deck that I create every month and I've done it for years.
• At the beginning of the year, I have a whole like layout of priorities. And so my priority stack for this year – and this is the same as last year – is family, work and play. So family's going to take precedence. Work is next. And then with all my free time, it's skiing, golfing etc.
• But I'm really intentional about it month to month. Here's actually how I'm going to use my time. And what that means is saying no to a bunch of stuff that doesn't fill those three things well, without any guilt.
• I have this quote that I live by, which is “Honour thy commitments.” And I'm getting better about saying no to stuff. But if I say yes to something, I'm really good at following through. In this day and age, it's really frustrating when people break commitments to me.

On selling Storyblocks

• My time in investment banking was also very educational because I got to see dozens of companies that were for sale. I was on the sell side preparing the confidential information memorandums and then calling potential buyers and trying to shop these companies. And so I got to see how you value companies, how you present them, who were the buyers.
• You’ve got to be really clear up front about whether you’re staying on when selling, because if you get into the process as the founder, the buyer puts a lot of value on that. They think the founder had a lot to do with the success of the company and they want them in the next phase.
• From the very beginning, I was clear about that, that I'm not going to be around for the next phase. And I didn't actually go to any of the meetings. So I had my CEO and executive team who ran the whole process. I never attended a single meeting, to show how absolutely useless I was to the process.
• The inspiration for how I priced Storyblocks was your margin is my opportunity.
• There's no race to the bottom if you start at the bottom. That actually made Storyblocks a lot more defensible and it's made Harvest Host more defensible because we have a fantastic product for an absurdly low price. And so if you're a competitor looking at coming into this market, there's no margin left. We've taken it to the bottom and we've done it at scale. So you're not going to something that’s better, faster, cheaper. You're not going to do it better than us. You're not gonna do it faster than us. You're sure as hell not gonna do it cheaper than us. So it's going to have to be something totally different.

On building versus buying a business

• My mantra now is, first you build it, then you buy it. I think building from the ground up is a great way to learn a lot from A to Z. But one of the things you learn is where you add the most value to the process and I guarantee it's not everything!
• Finding product-market fit with a startup is by far the hardest thing in the world. So when you buy a company, you skip that. You're ideally buying one that has product market fit, and then you're applying your expertise.
• What's hard is having to outlay a bunch of money to buy a company that you know you could theoretically build yourself from the ground up. I'm going to pay millions for the thing that you know you could do. Cutting that cheque is difficult, and then of course, questioning yourself, “Am I overpaying? Is this the right price? Am I going to buy this and it's going to fall apart tomorrow? I'm going to lose everything!”
• The financial investment is very real when you buy, but time and emotional investment is very real when you build. Basically, find a company that you really like or believe in that has a great concept, a solid brand and then ahead of time, think about where can I add value to it?
• I ask myself 2 questions. “Am I confident that I can buy this company and not screw it up, at least keep it going as well as they did?” With Harvest Hosts I was getting a 20% return on my money. That's way better than anywhere else in the market.
• And number 2, “Is there upside and what do I think it is?” And for Harvest Hosts, I thought it was to improve the technology and start marketing and advertising. I felt that I could grow the membership base. And so then with 20% as my low side, the upside was much larger. 
• Buy businesses that you're confident you can't screw up and it's all upside.

On finding something he could succeed at

• I did a Venn diagram of what I was good at. And in one, it was stock media, another it was RVing, totally different industries. And in the middle, where they overlapped, memberships, digital products, and marketing. And those were three things that I was very confident in.
• And I thought, even though they're totally different products, I bet you there's more similarities than differences when it comes to marketing a membership product to an enthusiast base.
• I think this is a fallacy that a lot of friends I've seen make. They want to buy a business and so they solve for money. They look for an industry that has a big Total Addressable Market. But when you love the business, it's a lot easier to run a good business.

On buying a business…then what?!

• When you're thinking about new products, it's not hypothetical and it's not academic. The question is, “Would I use this?”
• Prioritising what to do first and then in what order, because I bought Harvest Hosts knowing all the things I wanted to do and I was so hyped up and I wanted to do everything all at once. And you can't do that.
• But when you first come into a business, you're all excited and there's a million things you can do. Figuring out how to prioritise those million things is stressful.
• This is where being the customer helped. As a member of Harvest Hosts, I joined before I bought it, and I used the product, so I simply solved my pain points first.

Final message of wisdom and hope for future leaders 

• If I can do this, literally anyone can do it because I wasn't a remarkable student. I don't have some remarkable IQ, I don't have any sort of special gift or anything like that. I just simply did it, because I wanted to do it and then had to work hard.
• You just have to do it for the right reason. Know what you're trying to do. Don't just get into business because it's a cool thing to do. Make sure your heart's in it and then be diligent and actually work hard. Hard work is always going to be a necessary part of the equation.

Deal hope,

Greg