Darin Gilson - President and COO of Campus Pipeline
[Originally published 11/1/99]
For those of you who want to become entrepreneurs, joining a management consulting firm after business school might not be a bad career move. After graduating from Wharton, Darin Gilson decided to join McKinsey & Company. After completing a consulting engagement for Campus Pipeline, he and Chad Muir decided to leave consulting to help lead the small start-up into the future. Since then, Gilson and the other two co-presidents have grown the company from five to over a hundred employees in just over a year. They also recently raised $25 million in venture-funding from an all-star group of investors. Gilson is no stranger to entrepreneurship, though. Before business school, he started a mobile oil-change company called MobiLube while a junior at the University of Utah.
Given your earlier entrepreneurial endeavor, why did you decide to go into management consulting after business school?
At MobiLube, we made every mistake we could have made. While the business was ultimately successful, I wanted to figure out how to really do it right the next time. While I was in business school, the experience of being an entrepreneur was very fresh in my mind and I thought I would want to do it again eventually. But I would always tell people that I wanted to wait until the memory of how hard it is to run your own company had faded sufficiently before I started another company. That's how consulting became interesting to me. A lot of my friends had gone to medical school and done a residency, and that's how I viewed consulting - as a residency after business school to help me refine the new skills I had learned.
I had a great experience at McKinsey. The firm had recently begun a special program to serve "MIGs" - Market Innovating Growth Companies - and Chad Muir and myself wanted to be one of the first people at McKinsey to actually serve one of these small startup companies. Given our entrepreneurial backgrounds, we were also chosen by the firm to conduct an internal research study about business building. That was a g reat chance for us to interview entrepreneurs, venture capitalists, and corporations that were successful and not successful in building new businesses.
Were there any major findings that came out of your study?
You bet. The biggest lesson that we learned and we've applied is the notion that when you start building a new business, it's going to quickly evolve and go through many different phases. Part of the challenge is recognizing which phase you're in and the management style and tactics that you need to use in that particular phase. While our final materials were very extensive, you can look at business building in terms of three main phases.
The first phase is all about what we call "building believers". This is the phase where you have an idea and you need to get believers in that idea - including financial backers and your first employees. Frankly, it's a lot of missionary work and selling yourself and your idea. The second phase is "proving concept". Once people believe in you and your vision, you have to prove that you can really make the idea work. This is very detail-oriented work and involves a lot of heavy lifting and heads-down execution. And the people who were involved in the previous phase are not necessarily the right ones to lead the company in this new phase. The final phase is "managing for profitability". Once you're a public company and proven that your concept works well, things like quarter-to-quarter growth become the metrics that you're measured upon. Again, this phase takes a very different management style. Now, you need to make sure that everything you do is optimized.
Another thing we learned at McKinsey is that there is a lot of money out there. Getting funding is not the key. You need to get the right funding. We call that the "strategic source of capital". We looked at a lot of venture capitalists and corporations for our initial funding. Ultimately, SCT [a global provider of information systems to higher education] proved to us to be the most strategic source of capital, because they were so strategically positioned within our target market.
Any other advice for students?
Some people do one entrepreneurial venture after another, and in the process they eventually get it right. I think you can gain significant "builders judgment" and save yourself a lot of headaches if you master the science of business building through a great education and subsequent training. However, there is as much art as science to entrepreneurship so you ultimately just have to be courageous and jump in the game!
For those of you who want to become entrepreneurs, joining a management consulting firm after business school might not be a bad career move. After graduating from Wharton, Darin Gilson decided to join McKinsey & Company. After completing a consulting engagement for Campus Pipeline, he and Chad Muir decided to leave consulting to help lead the small start-up into the future. Since then, Gilson and the other two co-presidents have grown the company from five to over a hundred employees in just over a year. They also recently raised $25 million in venture-funding from an all-star group of investors. Gilson is no stranger to entrepreneurship, though. Before business school, he started a mobile oil-change company called MobiLube while a junior at the University of Utah.
Given your earlier entrepreneurial endeavor, why did you decide to go into management consulting after business school?
At MobiLube, we made every mistake we could have made. While the business was ultimately successful, I wanted to figure out how to really do it right the next time. While I was in business school, the experience of being an entrepreneur was very fresh in my mind and I thought I would want to do it again eventually. But I would always tell people that I wanted to wait until the memory of how hard it is to run your own company had faded sufficiently before I started another company. That's how consulting became interesting to me. A lot of my friends had gone to medical school and done a residency, and that's how I viewed consulting - as a residency after business school to help me refine the new skills I had learned.
I had a great experience at McKinsey. The firm had recently begun a special program to serve "MIGs" - Market Innovating Growth Companies - and Chad Muir and myself wanted to be one of the first people at McKinsey to actually serve one of these small startup companies. Given our entrepreneurial backgrounds, we were also chosen by the firm to conduct an internal research study about business building. That was a g reat chance for us to interview entrepreneurs, venture capitalists, and corporations that were successful and not successful in building new businesses.
Were there any major findings that came out of your study?
You bet. The biggest lesson that we learned and we've applied is the notion that when you start building a new business, it's going to quickly evolve and go through many different phases. Part of the challenge is recognizing which phase you're in and the management style and tactics that you need to use in that particular phase. While our final materials were very extensive, you can look at business building in terms of three main phases.
The first phase is all about what we call "building believers". This is the phase where you have an idea and you need to get believers in that idea - including financial backers and your first employees. Frankly, it's a lot of missionary work and selling yourself and your idea. The second phase is "proving concept". Once people believe in you and your vision, you have to prove that you can really make the idea work. This is very detail-oriented work and involves a lot of heavy lifting and heads-down execution. And the people who were involved in the previous phase are not necessarily the right ones to lead the company in this new phase. The final phase is "managing for profitability". Once you're a public company and proven that your concept works well, things like quarter-to-quarter growth become the metrics that you're measured upon. Again, this phase takes a very different management style. Now, you need to make sure that everything you do is optimized.
Another thing we learned at McKinsey is that there is a lot of money out there. Getting funding is not the key. You need to get the right funding. We call that the "strategic source of capital". We looked at a lot of venture capitalists and corporations for our initial funding. Ultimately, SCT [a global provider of information systems to higher education] proved to us to be the most strategic source of capital, because they were so strategically positioned within our target market.
Any other advice for students?
Some people do one entrepreneurial venture after another, and in the process they eventually get it right. I think you can gain significant "builders judgment" and save yourself a lot of headaches if you master the science of business building through a great education and subsequent training. However, there is as much art as science to entrepreneurship so you ultimately just have to be courageous and jump in the game!
posted by gnp at 11:31 AM
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