Phil Huff loves to build things.
Teams of people. Projects for clients. Whole businesses.
Building is about accomplishing goals for Huff, who must have been wired for competition from birth. From lawn mowing and paper routes to painters cap productions in college - all the way through the founding of eLynx and its $40 million sale five years ago -- he has always enjoyed the allure of assembling a successful project.
Huff is the son of a third-generation AK Steel worker, raised in Middletown with a strong work ethic and a sense of ownership in what he built. Although it wasn't immediately clear how Huff was going to direct this energy, a computer programming class at Indiana University convinced him that computer science was the way to go.
He and two partners built up Cincinnati-based eLynx over a 10-year period before selling it to American Capital in 2004.
More recently, Huff was tapped to overhaul BrandWatch Technologies in Portland, Ore., which provides brand security and product authentication technology to companies worldwide. He was brought in as CEO of the struggling company in February 2008 and has since reengineered the technology organization and recruited new leadership. It's launching its first new products this year.
There were times in those early years with eLynx when success seemed elusive. In the first five years, eLynx wasn't making any profit. Survival was a constant question.
"Those years were very tough on us," says Huff. "We weren't paying ourselves, and there were times I was using credit cards to pay bills. I was late on my mortgage payments. Talk about feeling destitute.
"But your a-ha moment often comes when your back is against the wall."
Those who know Huff well say he is a determined leader who has persevered through tremendous personal hardships - circumstances that didn't make him bitter but simply more determined to succeed.
"Phil is tenacious," says CincyTech executive-in-residence Mike Venerable. "He is also very good at sizing up a problem and then following through on how to fix it. He's a natural leader."
He's also immensely likable, with a sense of quiet confidence and well-being that engenders affection and loyalty from those around him -- qualities Huff acknowledges with characteristic modesty.
"What I know is how to motivate a company and how to manage and lead people, which is what I truly love," says Huff.
In addition to running BrandWatch, Huff is serving as an entrepreneur-in-residence at CincyTech. He sat down recently at a West Chester Starbucks not far from his home to talk with CincyTech communications director Carolyn Pione about his successes and his talent for hiring the right people with whom to build a successful organization.
Question: You were on track for a successful career at Miller Brewing Co. in the early 1990s. You had moved your family to Milwaukee and had received several promotions. What compelled you to start a company?
Answer: I began realizing that I had a passion to do things on my own. I had a business plan put together for a startup technology company, and I went to some investors back home (in Southwest Ohio) and we developed a full plan together.
Miller was going well. I had had three promotions, survived two layoffs. But I needed to do my own thing.
My two early investors and I founded Migralynx Systems Inc. (which became eLynx), which then was focused on electronic data interchange (EDI). That was in 1995. We made nothing at first. By 1997 we had a few customers but were not taking off like wildfire, and we were very low on money.
Obviously that changed. When did the turning point come?
We were on a plane to see a customer in Phoenix and were literally putting together a proposal on the way there for what we thought they wanted. We came up with software that would capture the print stream of an electronic document and make it available on the Internet.
They said "that is exactly what we wanted." And that was the birth of electronic document exchange.
Around that time, we needed additional investment. We met an angel investor from Batavia, Lou Lauch, who took us under his wing. He put together a funding syndicate because of his trust in the management and our recurring revenue model. Lou was key.
We became one of the early software-as-a-service offerings in the nation. We didn't set out to do that. We set out to do EDI. But what really drove that was a staunch refusal to fail.
And yet it was still another two years before things turned around?
In the summer of 1999, we landed Wells Fargo Home Mortgage. Eventually we had a leadership role in the mortgage banking industry - we really concentrated on that industry and went on to service 17 of the 20 top mortgage lenders. The refi boom was active, the housing boom was on. It was the perfect storm for us.
The key was to get that first big customer.
You often talk about the crucial need for good people in building a successful company. You seem to have an innate ability to find those people. How do you do that?
I've always had a fantastic team no matter what I've done.
It's important to be able to get people who want to follow you and be part of the team.
What particular qualities do you look for?
A strong work ethic, integrity, strong communication skills, especially a willingness to communicate both good and bad news. Smart people. In fact, I like to overhire, to hire people who are smarter than me. Why hire people who know what you know and do what you do?
How can you tell if they're smart?
I can judge it after a few conversations. I ask them how they've worked through past situations, what the high points and low points of their careers have been, what they think they need to work on in themselves, what they think of me. You know when there's a good fit.
It's also important to get other people's perspective on someone. I usually look to others on the team and then get feedback from the group.
You had a long, hard journey before you and your partners and investors finally saw a successful exit. Any advice for those who might follow your path?
I hope people don't read this and think 'well hell, I'm not going to put myself through that!'
If I'd have known everything I know now, I might not have done it. Your chances of success are so stacked against you.
But a key part of this is to not be afraid to fail. There is nothing wrong with failing, and a true entrepreneur has no fear of failure. They just fear not succeeding. There's a difference.
It's also very important to empower and trust the people on your team. Recruit the right people and them empower them to do their jobs.
So on the subject of failure, what failures in your life have you learned from the most?
The biggest failures I've made in my life are about not following my gut instincts. You've got to follow your instincts and act. You're definitely going to make mistakes, but it's imperative to make decisions and act. You shouldn't be afraid of the failure, but you should learn from it.
But again, you can't go forward as an entrepreneur if you have a fear of failure. You will fail repeatedly.
Just make sure you get back up, dust yourself off and keep running.
CincyTech is a public-private partnership whose mission is to invest in high-‐growth startup technology companies in Southwest Ohio. |