We’re excited to introduce you to the always interesting and insightful Dustin Campbell. We hope you’ll enjoy our conversation with Dustin below.
Alright, Dustin thanks for taking the time to share your stories and insights with us today. We’d love to hear from you about what you think Corporate America gets wrong in your industry and why it matters.
I wouldn’t say all of Corporate America, by any means, but in general, we think companies place far too much weight on trying to hire the right person (an “A-Player”) – someone who already has all the experience and attributes needed to be successful in a job day one, rather than on recruiting really capable people and teaching them how the company works and positioning them to be successful even if the employee is not a traditional superstar. We’re fascinated by companies that buck this trend – that have a record of making people better, providing exceptional products and services, and doing so in spite of not having a traditional strategic advantage (scale, early to market, proprietary IP).
In traditional business media and even in business schools, too much weight is placed on the companies that achieve outsized financial performance – and these companies often had or developed an advantage that is not available to most businesses. Apple invented the iPhone. Maybe there was something in the way Steve Jobs managed that others could emulate in order to create a like advantage, but there haven’t been many products comparable to the iPhone that have been invented. What Steve Jobs did (good or bad) had the good fortune to coincide with broader technological shifts (cellular networks, digital music, etc.). Trying to time your product innovation to larger macro shifts is difficult. So I would be cautious about trying to extrapolate too many lessons from Apple about how to run your business.
What we focus on are companies that achieve extraordinary results in businesses that look a lot like other businesses (from a competitive advantage standpoint). In our experience this is almost always done through a concentrated effort on creating excellent operations and an intentional culture in a way that is reinforcing and enables continuous improvement. There are numerous examples of companies that do this, and the patterns and structures are remarkably similar when you look closely enough. We help companies that are interested in becoming learning, continuously improving organizations, to build these structures so they can move out of the hiring A-players, losing talented people treadmill and achieve sustained performance over the long run.
Awesome – so before we get into the rest of our questions, can you briefly introduce yourself to our readers.
We launched Persistently in early 2024 to focus on helping companies build strong operations and amazing cultures that enable sustained business performance. We help build resilient companies.
Our founding partners started their careers in finance and operations, eventually overlapping in operating roles at a large private equity firm. We were somewhat shocked to learn how haphazardly the operational plans for portfolio companies were developed and executed. There’s a lot of press around the short-term drive for value creation in PE firms, and that was certainly true. But it went deeper than that. There was (and in many firms today still is) no concentrated focus on how to develop a strong, repeatable, business system or company playbook that could be used to both assess potential acquisitions, serve as a guide for operational improvements, and greatly increase the likelihood of achieving above market performance. There are a variety of reasons for this – including a lack of operational history and acumen on the part of most PE investors, misplaced faith in the power of smart people to simply “solve” problems (as opposed to developing strong cultures and systems that allow organizations to solve their own problems), and a limiting belief that quick fixes are better than the compound effects of continual, incremental improvements.
Having had the opportunity to work with dozens of CEOs and executive teams – both as operational advisors, as well as executives in portfolio companies – we began to codify the practices and principles that were broadly applicable and transferable across organizations. Later, we married this to research on other companies that had achieved long-term, sustainable performance that outpaced the market and their competitors. We bought our first company in 2015 to test and refine our approach in implementing these structures. And in 2024, we launched Persistently to help other companies implement these structures and systems.
Our initial offerings are fairly customized, but structured consulting engagements to help organizations with between 30-300 employees create operational structures and implement intentional culture-building practices that create an environment for continuous improvement. Many organizations struggle and plateau when they reach the point that their founders or executive team no longer know everyone in the company directly. The structures that successful firms use to scale beyond this effectively are knowable and adoptable. We provide the Blueprint for how to do this and assist in a variety of ways along the journey.
How’d you meet your business partner?
We were young professionals living in tiny apartments in downtown Boston (Beacon Hill) and met up on a shared roofdeck one evening when we both had friends visiting. After each of our friends left, we decided to walk down the hill to a pub for a few pints, and ended up closing down the pub. We simply hit it off talking about our excitement for where we were in life, things that inpspired or motivated us, questions we were grappling with. That friendship blossomed over time, across multiple interstate moves for each of us and career changes. The common element was that we’ve always loved to both challenge and support each other.
That spirit of challenge and support shows up in both our personal and professional lives. We’ve learned that we’re amazing complements to each other – Dustin is a bit more of the idea generator (dreamer?), but with a healthy respect for and interest in seeing things actually get done. Erik is a world champion listener with both an incredible ability to focus and prioritize work while maintaining a healthy dissatisfaction with the status quo. In our professional lives, this has led to us focus relentlessly on building better team-based cultures that deliver exceptional customer experiences, nurturing and rewarding employee environments, and above-market investor returns. In our professional lives, we are always looking for another challenge or adventure (through a long series of testing our limits, we sort of unwittingly became endurance athletes).
We ran our first marathon together in 2001. This year we’re training for an ultra-marathon obstacle course race. The name of our firm – Persistently – derives from the concept of “persistence hunting.” This concept is a theory that early humans adapted to run big game prey to death. In warm climates (like Africa), humans can outrun all other animals on the planet over a long distance. Our ability to perspire and regulate our body temperature, to run upright and pivot to see our surroundings, and to carry things like water give us enormous advantages over long distances. Combine this with an ability to communicated and coordinate with others, sharing information about our prey (which may be running in and out of a herd) and the environment (e.g., noticing where an animal may have left a track), gave humans the opportunity to literally run large meals to death.
To us, the metaphor for business was obvious. Play the long game. Train and learn from each other. Pick a target and stay focused on it. Know your environment. Communicate, communicate, communicate. Don’t give up. Just like our possible ancestors, businesses that do this persistently will almost always succeed.
We’d love to hear a story of resilience from your journey.
When we bought our first company, we had a nascent framework for our Persistence Management Philosophy. We knew the business we were had a lot of opportunity for improvement, but we were planning to move very slowly with making any changes, knowing we wanted to learn from the team what was important in this particular business, and wanting to get validation and buy-in from the team on changes we thought might help improve the business. Like Mike Tyson once said, “Everyone has a plan until they get punched in the mouth.”
Less than three months into our ownership, our number 2 and 3 sales reps in terms of volume left to buy a competing business and within a week hired over 10% of our workforce. Not long after, our number 1 sales rep left for a different competitor after we determined he’d been misbilling our largest customer for over a decade. We were industry outsiders, not steeped in the technical aspects of our industry. Many of our employees felt we didn’t really understand the business (on some level, they were certainly right). Many of our customers – already accustomed to receiving widely variable quality – now lost the salespeople that they had counted on for so many years to make things better. And our competition was heating up – both from taking our people, and from an increased presence of national competitors in our space. To top it all off, our lead investor, for whom we were able to generate a substantial early return, got spooked and asked us to buy them out.
Loaded with more debt than we had originally planned, declining sales, and a nervous workforce, we dug in. Over the following three years we completely overhauled all the systems in the business, streamlined operations and made clear what our cultural priorities were. We added services that our customers needed but which required substantial learning from our team to deliver, and began making the always difficult decision to turn away business that provided badly needed revenue, but which distracted from our ability to deliver consistent quality. We were turning the corner (improving employee and customer retention, landing large, multi-year contracts, etc.) and COVID hit. Our business installed technology in corporate and university offices and classrooms – largely in New England. And for two-plus years, very few people were using most of those rooms.
At the start of the pandemic, we brought our leadership team together and told them that we knew they were tired – we had just spent three years turning around the business, and now we were about to go through the most difficult period of all of our professional lives. But the team was proud of the changes that they had made and we all committed to each other that we could come out of the pandemic even stronger. We dug in again, further enhancing our services, renewing our commitment to bring on amazing team players, and listening to our customers rapidly evolving needs.
As we came out of the pandemic, our new bookings were growing 40% annually. Our recurring revenue (~2% when we bought the firm) was growing 60% annually and accounted for more than 20% of our total revenue. Our gross margins were up 50% from when bought the company. And voluntary employee turnover had dropped from 25% when we bought the firm (which was not uncommon in our industry, which had chronically underinvested in developing people) to 1.5% in the two years before we exited.
We had originally bought the firm with the intention to hold it indefinitely, building and refining our management philosophy and using the gains to make further acquisitions. After 8 years of turnaround and transformation, laid against the backdrop of the pandemic, we had more than proven our approach. But then the 2022 supply chain crisis hit. And it hit our industry particularly hard. We were achieving the sales growth we had been planning for and our customers were choosing us for our service in spite of the hefty up-front premium we were often charging (we almost always could demonstrate a lower total cost of ownership). In spite of our desire to demonstrate the advantages of long-hold investments, we knew their was too much risk in the global economy and our customers and employees would be better off as part of a larger entity with more capital resources to weather the economic storms. We sold to our largest industry competitor at the end of 2022.
Our aim is to make a meaningful contribution to changing what W Edwards Deming called the prevailing management theories. We initially thought we would do that by buying one company, and eventually another and so on. Our aim has not changed, but the universe hands your circumstances that sometimes cause you to adjust the course. We’re now both helping other companies accomplish what we did (in much less time) and remain focused on building our own portfolio as well.
Contact Info:
- Website: https://www.persistently.us/
- Linkedin: https://www.linkedin.com/company/persistently/
