Christian Gap Year for Entrepreneurs

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Bio:

Chris Hite is Principal and Co-Founder of Coreland Companies, as well as Kensington Real Estate Group, a real estate investment company. He has an extensive background in commercial property management, having managed directly or indirectly over 500 million square feet of office, retail, and industrial property across the Western United States.

Coreland Companies has been committed to providing the highest quality commercial real estate services to private and institutional clients across Southern California since its inception in 1990. Under his leadership, the Coreland management and brokerage teams actively represent nearly 150 commercial properties totaling more than 10 million square feet.

Mr. Hite possesses a degree in Business Entrepreneurship from the University of Southern California, a degree in Art History from Arizona State University and is currently pursing a Master of Liberal Arts degree at Johns Hopkins University.  He is married with three children and enjoys travel, photography and serving on a variety of charity boards.


Transcript:

Chris Hite 5/4/20

Seth Barnes: [00:05:44] Yeah. Can we talk today about how we move from being a young person into the position of being an entrepreneur and taking risk and  knowing if in fact that's a good career move for us? We've got these students here and even our staff, and at various times we ask ourselves, am I the kind of person who would do well in this, or am I better off just joining somebody else's business and letting them wait? Do I want to take on all the risks of being an entrepreneur?

And as a Christian entrepreneur, how do you do that? I think our students would love to hear more of your story and about those times in your life when you knew there was going to be a big risk. You're putting your family, not just yourself and your career, at risk, and how'd you make those decisions?

Chris Hite: [00:06:43] Well, if you're looking for a dissenting opinion on whether to do that or not, you’ve asked the wrong person because I was an entrepreneur major at school and then immediately started my business about a year and a half out of school in 1990. So I've been an entrepreneur for 30 years. And I honestly couldn't endorse it more strongly enough. And I think as a young person, the benefit for me was I could start a business and live on $500 a month. I mean, I didn't have a family at that time.

I was really kind of focusing on what sort of person and impact I wanted to have in the community, and we chose real estate to open our business because that's the business that we had been operating in. That’s my college roommate and I. When we started the business, literally with nothing, I took money off of credit cards. He took money from some money he had received in an inheritance, and we threw it into a pot. We're talking 5,000 bucks. I took everything I owned on two credit cards for me back then. We maxed them out, put the capital in, and started with nothing. We bought a software program and hung our shingle. And then, I went knocking on doors.

And honestly Seth, I'm 54 now. When I was 22 or 24, when we started it, I looked like I was 12 years old. So I was in a meeting, I remember a pitch meeting one time, where I was sitting in the lobby and kept saying “is so and so ready for the meeting?”

The receptionist looked at me and she goes “are we waiting for anyone?” I'm like, “well, what do you mean, are we waiting?” She literally said,” are we waiting for your father?” She thought I was like a kid tagging along with my dad in a business meeting, and I'm like, “no, I am Mr. Hite, so let's get on with this.”

So, that was fun as well. I had that challenge of looking like I was 12 and also trying to start a business. But I mean, I look at entrepreneurship like I look at art. And you mentioned I'm a photographer. I'm also an art historian. I have a degree in art history as well as business entrepreneurship.

And so I look at it like art, and I think as artists, what entrepreneurs are great at is observing their surroundings and their culture and then moving to respond to meet those needs. And it sounds so simplistic, but I think stop first to absorb and take in. You gotta be wanting to take in the pain points because those pain points, those threshold crossing points, that's the moment of opportunity, right?

You don’t necessarily want to go into a space unless you have a better mousetrap. You don't want to go into a mousetrap business. You're looking for those pain points, those places where you can respond and make a difference and truly add value, not just opportunistically.

You know, someone tried to get me into a business here in the last month saying let's start charging these tenants a thousand dollars to process their PPP applications. And I was like, I don't want to be in that business. I would rather teach them how to do these things, but I don't want to charge them.

I mean, maybe it was an opportunity, maybe it was a pain point, but you know, I had to evaluate. I'm into long term value, not just a short term gain. So, for me, I just said I have no interest in it. It might be a great business model for now, but that's not something I feel good about, so to speak.

Seth Barnes: [00:10:07] So it sounds like you are almost genetically predisposed to go into places that are ambiguous. An artist does that and begins with a blank piece of paper or a blank screen and then creates. And I wonder about the person who is not as prone to take on risk, something that we need to have in our gut before we go and be an entrepreneur.

What is it for you, the only kind of career option that you considered because of the way you're built, or how did you get to the place where you realized I'm just not like other people? I need to do something on my own.

Chris Hite: [00:10:54] It's a great question. My dad was not an entrepreneur.

He was an engineer. He worked for a petroleum company most of his life. Now, later in life, he started his own consulting business because of his context, but that wasn't until he was in his late fifties, early sixties. If you were to go back to my high school yearbook asking “what do you want to be”, it says entrepreneur. I've always just wanted to be that person who creates something and probably that's the right word. And honestly Seth, I don’t think that there is a quintessential entrepreneurial profile.

I mean, we tend to kind of look at some of the Silicon Valley guys and the guys in tech and say, well, you got to be brilliant. You have to have a computer engineering degree from Cal or Stanford or something to be able to be successful. I fundamentally don't think that there is a set formula any more than there's a set formula for being a leader. And I think you can make a really good argument that a great entrepreneur is inherently a great leader because they're willing to listen and respond and they can come from a place of introversion or great extroversion, it doesn't matter.

I mean, one of the early things that I read, probably when it came out, was Jim Collins, Good to Great. Collins makes a fantastic argument for leadership of both existing publicly traded businesses and small businesses that the best entrepreneurial leaders are servant leaders. In other words, they give of themselves, they respond with folks. They put other folks first. They are the kind of person that you would want to follow into battle, so to speak, if you're in the military. And many times, the early days of an entrepreneurial venture can feel like you're in battle cause it’s all hands on deck, 16 hours a day, right? There are no breaks. You're constantly dealing with challenges and problems and pivots and conversations. But man, is that exciting!

Seth Barnes: [00:12:51] Yeah, it is. He calls it a level five leader. I love Jim Collins. He's just one of my favorite guys. You know what he says to live a successful life? He says he's got three basic tenants, and the first is to live a simple life, an uncluttered life. He says to maximize the time and the flow state and the time you spend with people you love. But those are his three things.

And as I approach yet another stage of my life, you know of ambiguity and opportunity to take on risk, I like those filters as a way of organizing my life.. So I guess that's a segue to maybe giving advice to our young people here. What filters would you give young people in terms of deciding whether to be the leader ultimately for payroll and for product market fit and all those decisions? How do you make that decision about that versus going in and following somebody else's lead and getting a job somewhere?

Chris Hite: [00:14:09] You know, I think it comes down at some level to a passion. Do you have an idea? Do you have a thought or a plan that you can develop into a well-reasoned, well thought out business plan? And let's be honest, the best business plans are those that we treat like a science experiment where you have a hypothesis, you go into it, and you validate, does this really work?

There are plenty of business plans that come out of it saying, the numbers just aren't there, the risk and return just don't make any sense. So let's see if there's a pivot here or there is an opportunity, but sometimes when you just dive in, it's like anything. You can talk about the ocean, you can look at the ocean, you could talk about the waves and everything, but until you're out there, man, it's a whole different story.

But once you're out there, it's like, hey man, the waves aren't that big. Or we got beyond them. It's actually kind of warmer than they were talking to us about, like hey, let's swim around a bit and see what's going on here. It's getting past that initial fear. Look, I was nervous as heck when I decided to start the business. I won't lie. But you push past it. That's the only way you can really say it. It's an end. I always had in the back of my mind, “look, I'm 20 something years old. I don't have a giant home that I need to worry about. I don't have a lot of clutter.”

You mentioned Collins talking about a simple life. My life was inherently simple because I didn't have two nickels to rub together. And for me, it was like, well, I guess I can always fall back to going to work for someone if I had to. But the reverse cannot be said. You go to work for someone, and you are working for the man. Then, you leave the security of that paycheck, the security of the 401k and go back into entrepreneurship.

That road is not well-traveled necessarily. I mean, plenty of people have done it, certainly, and left their jobs and been quite successful. But, I’m saying as a young person, you're in a unique place where literally you can live on tuna fish and like I did, on top ramen for two years, if you had to, and that's about right.

Seth Barnes: [00:16:08] Yeah, that's good. Well, I love it. And that's my life. So again, I love talking to people like you, Chris. You have done that because it's exhilarating and it's scary. And then to actually succeed is such a gift. I added the students and have them follow up with questions.

Chris Hite: [00:16:34] Yeah, I recognize those faces!

How are you? Before the students speak, Seth, the one other thing I would add to that and something that they drilled into our heads in entrepreneur school, was seeking to build a team around you. You know, you think of yourself as a siloed entrepreneur. I have to do this. I'm taking on this risk. I'm doing all this stuff.

But in reality, you look around and you start to build a team. That team can be mentors or peers, but that team can also be my first accountants, my first attorney, my first, what have you. In picking those people that speak into you and have been through that well-rutted road, it can be quite helpful and add a lot of confidence when you look around and say, oh, it's not just me. I actually have six people that are in my car with me. So it adds stability and a desire to push forward as well. So anyways, that was something they beat into our heads in the entrepreneur program every day.

Seth Barnes: [00:17:35] That’s so true and hard to build. Okay. Let's go to that class and your questions.

Kyla Calderon: [00:17:43] I have one. what is something that you wish you would have told yourself as a 22 year old entrepreneur?

Chris Hite: [00:17:48] What's that?

Kyla Calderon: [00:17:49] Like, what is something that you wish you would have told your younger self?

Chris Hite: [00:17:53] I have it sitting right here. It says, I wish I'd had the courage to live a life true to myself, not the life others expected of me.

And in essence, what that says is have the courage to follow what you think is right and your passion and not necessarily fit into this “oh, I'm supposed to go get a job at Arthur Anderson or some big four accounting firm and just go do this thing.”

It's like, no, being an entrepreneur has risk and people will tell you, “oh my gosh, you know, it's going to be so hard. You're going to starve, it's going to be so scary.” And you're like, yeah, and that's what excites me about it! Go do it. But I have that sitting right there taped, so I never forget.

Especially the “others expected of me” part.

Kyla Calderon: [00:18:43] That's really good. Thank you.

Stephen Barton: [00:18:45] Yeah, I got a question. So when you talked about when you first started withdrawing money and getting stuff together to start your own company with your college roommate, what did getting your feet wet initially look like for that?

What was that first terrifying step?

Chris Hite: [00:19:05] Oh, the first terrifying step was just going into debt because not everyone has capital from a family or capital from an investor to jump into something, so we were self-funded. Fortunately, we were going into an industry where there was not a huge barrier to entry.

So for us, we were going to be real estate managers, and so our biggest cost was accounting software so we could operate the properties. And then the next big step was getting out in front of people with a pitch and an idea to be different. There's a lot of competitors in that industry.

We were going up against some of the biggest companies. CBRE is one of the biggest real estate companies, if not the biggest in the world. And we were bumping into those guys at 26 and 24. At some point, you just believe you have something that's different.

You sell a nimbleness, that you don't have a preset box that most companies want to put a customer into. You’re willing to create a custom box for that person, something that's different if you have a product that's set or whatever else. But if it's a service, we sold around the idea that we can give you something that's very custom, that no one else is willing to do, and we did.

We went out of our way to create and to add value for stuff, stuff that made no sense to be perfectly honest. We look back on it, and I'm like, oh my gosh, we should have charged 10 times what we charged to get that service. But when you start out, you do whatever you have to do because you recognize it's not just that first client from a capital perspective or from a cash flow perspective. But every client you're bringing on is a testimony to your next client. So you take care of that person, and when someone else comes along, you say feel free to talk to my first customer, and then that snowballs.

And so, you're always in a place where you're building, if you will. And it's a layer. It's not just a linear projection on a chart. I look at it more like it's a layer. It has mass to it versus just a two dimensional chart.

Stephen Barton: [00:21:09] It's good. Thank you.

Chris Hite: [00:21:10] But yeah, take that first time when you draw all the money off of two credit cards and put it into a bank account and hang your shingle and get your business cards. We got our business cards about two days before we went to a national conference to pitch ourselves as this new company. And I jokingly say my first lawsuit was actually the business card guy. They were still wet. So we would go to the conference, we'd hand out our cards, and people would be like what's wrong with these cards?

They were smudging and whatever else. And so we went to the business card guy and was like, hey man, those cards, they were terrible. And he's like, well, you have to pay us like $50. I'm like, whoa, we're not going to pay you, they embarrassed us! We were thinking people were going to get it on their shirts and stuff.

Anyway, we worked it out. We paid him and he made us new cards, but it’s the very first thing to happen as a new company. It's like, wow, stuff happens. We still joke about those silly business cards. Anyway, a small segue.

Kelson Mudd: [00:22:17] Hi. I was just curious because we were talking about risk and things like that. So, when you're making a decision, what does your thought process like on assessing the risk involved? What things do you take into account?

Chris Hite: [00:22:34] Well, I think there's various types of risk.

I mean, there's risk that is a direct risk to capital, to the money that you're investing. But there are also ancillary risks like liabilities. You may be going into a business where not only do you have risk to money, but if something goes wrong, there's a risk to the public or to lawsuits.

So you have to measure all this risk, but ultimately you're looking at your return model. And that's part of doing the business plan. You really look at it and gut check your models and say, okay we're going to take X amount of risk on, do we think the reward is there?Can we grow it fast enough?

To get there, you're never going to mitigate the risk to a place where you feel comfortable, ever. Risk inherently feels like a gut check, but like public speaking or something, the more you do it, the more attuned and the more accustomed and the more comfortable you are with it. But it still makes you feel uncomfortable, which is also part of its appeal in my personal opinion.

It’s kind of like adventuring. You guys have done a lot of adventuring. I've seen a lot of your pictures and some of the crazy things you guys have climbed up and gone down. That’s risk right there, you know? But it’s the exhilaration of, yeah, we're going to climb this waterfall vine thing that you guys went through. I wouldn't have gone up that thing!

Kelson Mudd: [00:23:55] That's really, really good.

Chris Hite: [00:23:59] But don't forget about the secondary risks. You have to really think, “okay, what are the other risks here?” And then you have to be honest about your own risk and responsibility. Seth started off talking about families, and I hedged and said, “well, when I have no family, there's a lot less risk because it's me.”

But when you do have families of people that rely upon you, they get put into the risk equation.

Kelson Mudd: [00:24:24] Yeah, thank you. That's really good.

Lexi Grisanti: [00:24:30] Our business model is based off of a passion project and what drives our passion. Do you typically do that when you're looking at a business endeavor, or do you look at holes in the market? How do you go about your new projects?

Chris Hite: [00:24:45] Well I think they both have to be there, but I would probably start with looking for pain points and the like. You can start with passion and then try to fit it into the market, or you can find things within the market that might center around things that you're passionate about and try to find that confluence of where the two cross. You can start either direction, but I think they both have to be there.

As I was mentioning earlier, someone was like, “yeah, we could start charging tenants $10,000 processing these things.” I'm like, do I want to process loans through the federal government for it and charge someone a thousand bucks. I have zero passion for that. It might've been super profitable, but okay, great, profit is just one aspect of being an entrepreneur. In my personal opinion, there's a whole level of fulfillment. I called it artistry earlier, and I think there's kind of an artistic element to it where the satisfaction is in and of itself of what you've created.

You know that! How many businesses have you started?

Lexi Grisanti: [00:25:48] Yeah, that's good. Thank you.

Chris Hite: [00:25:49] I mean, it feels great to get that website going and you see Sol & Co, and you’re like oh my gosh, I created that. That's an amazing feeling! That's passion, and you feel that way. Even my wife and I have our little apparel business that we started in the last two months. When that website was done, I was beaming like a little kid.

Lexi Grisanti: [00:26:15] We love looking at it too.

Chris Carlson: [00:26:24] I’m one of the mentors, I absolutely love your daughter. She is awesome!

My question is how do you bring the kingdom into your businesses?

Chris Hite: [00:26:38] That is a tremendous question.

You can do it a number of different ways. I think that you can do it very intentionally. I have a friend of mine who prays regularly and opens up every one of the staff meetings with a small Bible study that he leads and what have you. It makes it very clear that it's a Christian based business and the like, and that’s an amazing aspect of his company.

When I started my company, I wasn't a Christian, so it didn't really work its way into the culture and DNA. And my business partner was not and is not. So a lot of it for me has been my personal conduct and the way that we look at, in particular, our people. Because to me, that's what Christ looked at, right?

He dealt with a number of different things, but it was always about the folks and how you treat folks. That becomes really, really challenging in business when you start to juxtaposition and you really start to ask yourself but what would Jesus do? It can be really challenging, especially if you have an employee that's not performing or someone that's not fitting in as a good team member and a good collaborator. Or maybe someone hasn't grown with the rest of the team in their scale and ability and yet they're still a wonderful person. They still might all be people of faith, and you're like, how do we move this to the next level when it might mean having to terminate, or, you know, that's a terrible word, but that's the truth of it?

You could only pray through those things. And again, I think you want to have a team around you, and hopefully that team is a faith based team as well, so you’re not just the person making that sole decision. You may be the person ultimately who decides, but what's the proverb? I believe it is that the wise man has many counselors. It's absolutely the case in business, even starting off as a 20 year old. You need multiple counselors.

Seth Barnes: [00:28:32] So, we're nearing the end of our time here, Chris, and I've got just a couple of questions we could conclude with.

One is just tell us about how your team has helped you through this time and the difference that has made since that's been such an important emphasis for you.

And secondly, as a dad raising up a young entrepreneurial daughter, I do this with all my kids so it's really fun for me to hear other people like yourself, there's risk implied of releasing them to the marketplace. How do you know when you’ve done enough and how do you know the balance of being a dad that is there to comfort  or to provide?  How do you walk that balance out? So just two questions about the team and as a father.

Chris Hite: [00:29:25] Okay. What was the first one Seth?

Seth Barnes: [00:29:29] The first is your team and how you are relying on that in this time of ambiguity and navigating an uncertain environment. How do you rely on your team now?

Chris Hite: [00:29:50] Well, hopefully you've built a team and building into that early structure is a collaborative idea. You've not put any hard boundaries down necessarily on what people can speak into you. In other words, if you've built a team of yes men, they're really of no value. You want people to challenge it. You want people to say, “well, what do we think about this? Or well, if we do this, then this.”

So the value of the team is when you’ve thoroughly assessed the situation and the risk as opposed to everyone saying, “oh yeah, that's a great idea. Oh yeah, Chris, you're really smart.” No, that's not a great team. I've heard it called like a 360 beach ball. They’ve literally spun the ball. They’ve looked at every single panel. You've talked about every seem. We've talked about every nozzle. And you basically come to a conclusion of, okay, given what we know at this moment, this is what we recommend that you do. And ultimately that entrepreneur has to make that decision.

But hopefully it's with some assessment or some agreement amongst the folks. But occasionally, there's been occasions where I've had to listen to everyone and say I disagree with everyone and move forward on a different path because I just felt like they were being too afraid or they were being too what have you.

But I would say that it’s less than 1% of the decisions that we make where we don't come to some sort of idea or consensus based upon what you know.

The second one is about raising entrepreneurial children. You start early on. It's not suddenly you just start parenting in a certain way.

Hailey knows that I've always said pain is the most powerful teacher, which isn’t a physical pain. It's this idea of failing. I've never been a person who says, (I’m certain I’ve done it a few times Hailey) “who did this? Who's at fault? Why?”.

It's more like, “okay, how do we not do this again? You know, how do we look around when we do make a mistake or incur pain and say, what did we learn from this?” But as a parent, you try to instill values. You try to instill a structure and a love.

And I would hope that Hailey knows that no matter what happens, her worth to me has zero to do with how successful she is as an entrepreneur. Zero. So, there is no risk to her. You know, she doesn't have to perform for her father. She doesn't have to be a successful entrepreneur.  Of course, I want her to meet her goals and dreams and aspirations, but there's going to be bumps.

I've pivoted a million times, and I've made money and I've lost money. I've had periods during downturns where I've had to turn off my salary so that other people in my company could not be laid off. And you do what you gotta do, but as a parent, at some point Seth you just let them go and you listen and you nod and you try to be maybe part of that team a bit, off to the side. But not necessarily in the trenches every day, because you may not always be the best coach for your kid.

We've all seen that player, coach dad who's a little overbearing. I don't want to be that guy. You know, I want to be the guy who sits behind, who's constantly encouraging because Hailey knows that I also say that encouragement is a currency. You can spend it or not, but when you do, it returns, in my opinion, incredible returns.

Seth Barnes: [00:33:19] Hmm. Thank you. Well we're at the end, and I really enjoyed talking to you, Chris. I resonate with so many of the themes of building a team, allowing pain to do what it needs to do, and just not being able to do anything else but take risks because that's kind of how you're made - just diving in. It resonates deeply with man, and we're just so thankful to you for being a father to Hailey because she's been an awesome young lady. And we just think, as Chris said, so highly of her. And so I feel like a real partner with you in terms of investing in her and her future because I believe that she's going to change the world.

So thanks.

Chris Hite: [00:34:09] When people ask us what she's doing, we literally say Hailey's changing the world.

Seth Barnes: [00:34:15] Yeah, she is. Well, thanks for the time, Chris. You guys have a great day. All right. Actually, if I can ask one of the students to pray for you. Haley.

Hailey Hite: [00:34:39] All right. Oh my gosh. God. I'm just filled with so much thankfulness and gratitude. Thank you for the man of God that my dad is. He’s a son, a father, a friend, a husband, and even more. This is just a reminder of how important it is to remeet the people around you that you've lived and grown up with.

Thank you that you’ve been speaking through him and to him his whole life, and I just pray you continue to build him up and remind him what he's here for. I pray you continue to bless the artistry he has, his photography, and all the visions and passions, and that you'd be the loudest voice for him. There are people that say things and expect things and there are a lot of different things and noises we can listen to.

And so I pray that your voice and your word and who he knows You to be is the truest thing he sticks to. Thank you for the family I got to grow up in and the daughter I get to be to him. I pray for blessings and more over him, Lord. Amen.