Jeffrey Hill, Hill-3 Investments, LLC
One of the fascinating and successful entrepreneurs interviewed for my book 21 Questions for 21 Millionaires, Jeffrey Hill, proved to be as sharp as he is intriguing.
When you’re talking to Jeffrey, you better keep up. He knows what he wants, has vision, and moves straight toward it. I think you’ll enjoy reading about his business successes and the interesting man behind them.
My questions are bolded, with follow up questions shown as B:
I’d love to hear first about your background and childhood.
I grew up in Massachusetts. I had an older brother and younger sister.
I had some very serious leg ailments and that was very challenging for myself and my family. We spent a lot of time in the hospital, which I have no doubt had some impact on my personality.
My dad owned a jewelry store. He worked six days a week from 9:00 a.m. to 6:00 p.m. The only time he had an employee was the holidays. He had a tough retail life.
B:What impact do you think that had on your work ethic?
I think it had an important impact, and my dad was a great salesman. He had a lot of friends. That had a lot of impact on my life, watching how he handled people. People believed in him and trusted him. He could sell anything. He was a very effective salesperson, and that was his strength.
Unfortunately, he chose to run a jewelry store instead of selling jewelry. Running the business might have been a little challenging because it requires many other skills beyond selling. Watching my dad I began to figure out that you should focus on what you are good at and find verticals or businesses where that strength is rewarded and respected.
My mom had a lot of energy and was entrepreneurial in her own way. She started a lot of businesses while bringing three of us up.
I also had many businesses when I was younger. I started mowing lawns at the age of 12 or 13. Probably the most notable [business] was when I got to college. I became a lifeguard on a beach in Holliston State Park and ran the beach. The guys that worked with me were teachers and this was their summer job.
One of the guys was a marathon runner and he had several age group world records. He would run every week and would win stuff every week. One day he invited me over to his basement and there was a whole basement full of stuff; TVs, radios, anything and everything he had accumulated by winning amateur races.
I said, “There’s a deal to be had here,” so we brought that stuff down to the beach along with a bunch of sunglasses I had accumulated and before we knew it we had a barter business. By the end of the year, we accumulated an enormous amount of stuff. We opened up a flea market stand and sold the merchandise for almost $25,000.
B:Did you have to get a permit?
We should have. In those days I lived by a philosophy, “Errors of commission are always better than errors of omission.” I was 17, I didn’t know any better.
Then I got to school at the University of Massachusetts. I got a nice break in that I met a gentleman who was on the GI Bill, had two kids, was much more mature than the rest of us, and was graduating a semester early. He was very focused on getting a job.
I got close to him and began to go with him to the placement department. He helped me get motivated to look for jobs a semester early. I got my resume ready and worked with him to understand the companies that were coming onto campus and one of them was Procter & Gamble [P&G].
The way P&G worked the interview process was that for every three rounds of closed interviews they had one round of open interviews. The open interview was first come, first served. I thought, “P&G is coming, they’re the best marketing company in the land, I’m going.”
I got there at 4:00 a.m. The next guy showed up at 7:55 a.m. The interviews started at 8:00 a.m.
I went through five rounds of interviews, three trips to Cincinnati, and I got a job as a marketing guy. That was a huge break. That whole thing: my friend being a GI Bill guy and having kids, getting there at four in the morning, those were a series of good breaks.
I got promoted and worked my way through the ranks at P&G.
B:Just by working hard?
I worked hard and was driven and motivated. I was very competitive as were they. But competition in those days was done in a fun way. We all became friends.
I was running Joy dishwashing division and then a friend, a P&G guy, approached me and said, “There’s an opportunity to go back East”–which was a goal of mine because I grew up in the East–“to work for a company called Tampax.”
Five P&G managers all decided to go to work for Tampax: the head of R&D, head of research, head of finance, and a few others. That was very appealing to me because I was 29 and it was an opportunity to get a bigger job at a serious company, be able to make a difference, and go back East.
It was a very interesting story as to what happened. P&G had launched a brand called Rely Tampons and just beat [up] Tampax. Tampax had 65 percent market share before P&G launched. P&G launched this massive marketing campaign and it took 30 share points from Tampax in the first six months. Tampax went from about a $600 million business to a $350 million business in six months and P&G probably would have continued to [beat up on] Tampax.
Then an unusual thing happened that changed the marketplace. Toxic shock was identified.
P&G’s number one marketing technique in those days was household sampling, an execution they used with Rely. Eighty percent of menstruating females were sampled at home. So when Toxic Shock was identified and post-research was done with regard to what tampon brand the victims had used, virtually everybody answered, “Rely.”
P&G had two options. One was to show the testing, which proved that they were not the problem; reinforcing the several years of testing they had done before launch. The other was to say, “The consumer energy is against us, we’re a consumer company, let’s just bite the bullet and take the high road.”
They withdrew the entire Rely brand; a $75 million after tax loss. They had spent a fortune on this thing, they had been working on it for years, but they did it anyway because they’re a high ground company and they always do the right thing; very impressive.
I was 29-years-old, didn’t have a passport, was running the marking department for Tampax, and our CEO said, “Get on a plane and go find technology anywhere around the world.” I flew to Germany, I flew to Belgium, I flew to Paris.
I had no idea what I was doing. I was a smart marking guy, but I wasn’t ready for this. It was great. I loved every minute of it.
We found a super absorbent technology in Japan and we created a brand called Maxi Thins. It became an 11 share, $110 million business virtually overnight. Then we did some other fun stuff. We found another thing called a monoclonal antibody. It turned out to be a superior fertility- and pregnancy-detection device and we created a brand called First Response, which is still around.
After being at Tampax for three years, I got a call from another P&G guy who said, “We’re about to buy a consulting company called Glendinning Associates from the founder Ralph Glendinning,” also an ex-P&G employee.
He had an enormous reputation. He had built a $300 million consulting company with offices all around the world; very exciting business. These guys knew how to have fun and work hard. I caught the disease and took the job.
The other six guys who invited me to join are really players and I was the last guy down the line. Eight years later I was one of the partners.
Most of my partners decided that they wanted to go back into industry and become senior management of various companies. I didn’t want to do that; I loved consulting. It was very entrepreneurial, no politics, a lot of money. It was great.
I started my own consulting company called Meridian Consulting. I started it with three clients, all of whom I had developed at Glendinning: Schering Plough, Chesebrough Ponds, and Nabisco. I had no staff [other than a] secretary.
We did a lot of good work and almost all of the people that [later] worked for me, and almost all of my clients, were in my P&G network. The P&G network had grown and grown. People would leave P&G, become a superstar somewhere else, and they’d hire us. Then they would leave that firm, become a superstar somewhere else, and hire us there.
In consulting, the secret is to win for your client from a business and career standpoint and we were good at it.
I sold the firm in early 2000 for cash to the second largest French Holding Company, Havas, and their U.S. subsidiary Euro RSCG.
There was money everywhere to buy firms like mine because everybody wanted a strategic think-tank consulting company to lead their enterprise. The Big Three accounting firms wanted it, all the advertising holding companies, and several others.
B:You had put virtually no money into the company?
I had no money in the company, but I had 25 years of my life, which was the equity.
Money is a lot less important than the equity you bring to the table, whatever your equity is. Intellectual horsepower, your skills, your inventions; whatever they are, that’s the value of the firm.
What makes a firm successful is the ideas, the intellectual capital; that’s what runs a company. Then anybody with high net worth can be approached and if you’ve got a good idea and you’re passionate about the idea, you can sell the idea and get yourself funded. I’m oversimplifying, but the real essence of what makes a successful company is the idea, not the money.
P.S. Without the money, the idea is not likely to percolate, so you do need the money, but the important thing is the equity, or the patent, or whatever it is.
After I sold the firm, I started a foundation helping kids with the same operation I had when I was a kid. We do it for uninsured families.
I did that for a year-and-a-half and it wasn’t quite as intellectually stimulating as I thought it would be. I then started making investments. My first investment was in Noodles and Company in Boulder, Colorado.
I also invested in Papa Murphy’s and helped run the business for a while as the Chief Strategic Officer. I started getting more entrepreneurial and starting to do other deals. I started a real estate development company.
Then Jan Horsfall whom I knew from consulting at Valvoline called me up and said, “I want to get into the gelato business.”
I asked, “What do you know about the gelato business?”
“So what gives you the license to go into it?”
He said, “I’ve done a lot of due diligence.”
I said, “That makes you a smart guy, but I’m not investing in the gelato business on your word. If you get involved in the gelato business for 12 months and call me back and tell me you’ve been in it for 12 months and now you know it, then maybe I’ll invest.” I knew he would not do it.
He did it. That’s why I got into the Gelazzi business.
What would you say is your greatest success?
My kids, because I think they are going to do very well. They’ve got a good sense for both sides of life. They understand what it takes to succeed and they’re diligent, committed, and motivated. They also have a soft side, which is great.
They increasingly understand philanthropy and what it means to be somewhat more disadvantaged than they are and how to feel responsible to people other than themselves. It’s very unusual with kids.
That’s probably the best work I’ve ever done.
Certainly the work with the foundations is a close second.
Maybe someday my kids will take over the foundations, which I hope they do, but they always laugh at me and say, “Dad, stop writing the future of our lives before we’ve even started thinking of it because we’re not doing anything you tell us to.” After all, that’s how kids are.
What’s the difference between you and others like you who have plenty of money, who have accumulated a lot of worldly wealth, and those that just struggle?
I can speak to it in the entrepreneurial context. I think there are certain “what counts” factors. Motivation and drive are absolutely fundamental. And knowing what you don’t know and seeking out help from people to fill in your voids.
I also think vision is critical. I don’t mean vision in a big lofty context. I’m talking about vision as it relates to your ability to see how you can fit into something.
Would you say that passion equals success?
No. I think passion is important though.
The most important thing to success is you’ve got to have a good idea, or you’ve got to work for a company that has a good idea. Then you have to be able to execute in that environment.
If it’s your business, you’ve got to figure out an executional plan for your business. If it’s somebody else’s business, you’ve got to figure out how to execute in that space.
So having a good idea and being able to execute are the first two things.
If you’ve got passion on top of that and good people skills, then you have a lot of the basics.
Did you have written down goals?
B:Did you ever set out to be a millionaire?
My economic goal centered on where my dad came from. I thought $100,000 was all the money [in the world]. Then my goal was to have enough money so that money was not an issue in my life.
I didn’t need to have lofty goals. I didn’t grow up with a lot of things. My family had a lot of love and we worked hard.
B:Do you have goals now?
B:And you have plans to get there?
B:But you didn’t along the way?
I did as I got older.
You asked me if I did when I started. No, I didn’t. Did I have the goal of being a millionaire? I had the goal of being successful. I didn’t know what that was.
I tripped over the P&G work, that wasn’t planned. If it weren’t for the guy who was on the GI Bill, I may never have gotten there.
What would you go back and change, and why?
My normal answer to anything like that is…
To read the rest of Jeffrey’s story or others, pick up a copy of 21 Questions for 21 Millionaires today.