Foreword by
KENNY TROUTT
Founder, Chairman and
CEO,
Excel Communications, Inc.
THE
EXCEL
PHENOMENON
The Astonishing
Success Story of the
Fastest-Growing
Communications
Co m pa ny and
What It Means to You
JAMES W. ROBINSON
—
US $200 °
'
ISBN 0-7615-1171-7
|
Can. $26.95
AN AMAZING STORY
THIS
THE STORY OF A
IS
remarkable business opportunity,
one that
is
open
to
all
and
simple
as
is
to grasp as a telephone handset.
It's
about good old American ingenuity.
about offering consumers a better
It's
deal.
It's
about people helping people.
about accommodating and
It's
strengthening the family while
working
for financial achievement.
about
It's
false starts
and missteps,
end the brief history
too, but in the
of Excel Communications,
Inc.,
is
the ultimate American success story.
If
you
believe in challenging
conventional wisdom, or
if
you're
looking for reassurance that ideas
count in our
you.
is
Old assumptions crumble.
ideas emerge.
Think about
there
society, this story
still
for
New
Opportunity abounds.
it:
For nearly a century,
was only one phone company,
and almost everyone
—
scholars,
economists, politicians, business
executives,
and consumers
assumed that was the way
be.
Then,
—
just
it
had
to
in the early 1980s, the
breakup of that monopoly opened an
opportunity for a young entrepreneur
to realize his dream.
That dream
ten years,
$2
Excel. In less than
Kenny Troutt and
partners have
a
is
grown
their
billion corporation.
his
dream into
They've
(continued on back flap)
THE EXCEL PHENOMENON
James W. Robinson
foreword
by
Kenny A. Troutt
CHAIRMAN AND CHIEF EXECUTIVE OFFICER,
EXCEL COMMUNICATIONS, INC.
The Astonishing Success Story
of the Fastest-Growing
Communications Company—
and What It Means to You
PRIMA PUBLISHING
©
1997 by James W. Robinson
No part of this book may be
All rights reserved.
reproduced or transmitted in any
form or by any means, electronic or mechanical, including photocopying, recordby any information storage or
ing, or
from Prima Publishing, except
PRIMA PUBLISHING
retrieval system,
for the inclusion
and colophon
without written permission
of quotations in a review.
are trademarks of
Prima Communica-
tions, Inc.
Library of Congress Cataloging-in-Publication Data
Robinson, James W.
The
phenomenon:
Excel
the astonishing success story of the
fastest-growing telecommunications
to
you
/
—and what
company
it
means
James W. Robinson,
p.
cm.
Includes index.
ISBN 0-7615-1171-7
1.
Excel Communications.
distance.
2.
Telecommunication
3.
Telephone
—United
—United
States.
I.
States
—Long
Title.
HE8846.E95R63 1997
97-23828
384'.06'573—dc21
CIP
97 98 99 00
HH
10 9 8 7 6 5 4 3 2
1
Printed in the United States of America
How to
Order
Single copies
Rocklin,
CA
may be
ordered from Prima Publishing, P.O. Box 1260BK,
95677; telephone (916) 632-4400. Quantity discounts are
also available.
On
your letterhead, include information concerning the
intended use of the books and the number of books you wish to purchase.
Visit us online at http://www.primapublishing.com
Contents
Foreword by Kenny A. Troutt
Preface
xi
Acknowledgments
Note
to the
One:
vii
xix
Reader
xxiii
A Winning Combination
Two: Ringing
the Bell
1
25
Three: "The Most Impressive Thing
I've
49
Ever Seen"
Four: Answering the Question
Five: Independence
Six:
Day
Why
91
Remembering What's Important
Not Too
Seven:
Its
Eight:
No More
Nine: Imagine!
Late
Excuses
71
115
135
159
185
Ten: An Interview with Kenny Troutt
209
Conclusion: Ten Questions for Your Future
217
Index
221
Foreword
When
had
BEGAN
I
a lot of
dreams and expectations
I
years after
we
started there
ten about the changes
nications business
we
would be
a
less
than 10
whole book writ-
are bringing to the
and the
I
new com-
for the
never dreamed or expected that
pany. But
on
Excel Communications in 1988,
telecommu-
we
are
making
far so fast in
such a
positive impact
people's lives.
Because Excel has traveled so
high-profile industry, our
company
has received a great
deal of attention in the nation's leading business publications.
As the company's founder,
press frequently as well.
—
not been told
business
who
opportunity
now.
It
concerns the people in our
offered them,
and
and achieved
their families
dent Representatives to
I
am
in the
But a big part of our story has
Jim Robinson brings many of
and
been quoted
have seen the vision, grabbed hold of the
we
for themselves
until
I've
life
in
through
great things
free enterprise.
Excel's leading
Indepen-
The Excel Phenomenon
y
pleased and very proud that they are getting
the recognition they deserve.
Excel has fundamentally changed both the tele-
communications industry and the network marketing
Vll
Foreword
business in our country.
We
plan to continue to lead this
change in the years ahead. Jim has clearly articulated
both our achievements and our vision for the future.
More important, when you
come away with
a powerful feeling of excitement
optimism about the times
We
read this book, you can
in
which we
and
live.
face serious problems, to be sure.
Many Ameri-
cans are rightfully concerned about their financial secu-
They
rity.
lack confidence in the ability of both big
business and big government to continue to provide
either a rewarding career or
They
are deeply troubled
an adequate
social safety net.
by the lack of time and atten-
tion they are able to give to their children,
due
time demands of the modern-day workplace. Too
to the
many
have deferred their most cherished dreams for too long.
All of this can be changed.
None of
it
need be
accepted. That's the vital message of The Excel Phenomenon.
Whether you choose
or another, this
book
to participate in our business
offers a
compelling case that
never been easier to start your
The
out on your own.
greater for
you
to
life,
has
business and strike
opportunities have never been
become your own
ness with your family
your time, your
own
it
by your
side,
boss, build a busi-
and take control of
and your dreams once
again.
I'm very proud of the role Excel has played in fostering a
new
era of promise
entrepreneurs.
What we
ness opportunity that
is
and excitement
have tried to do
open and
is
for
American
create a busi-
accessible to
all,
that
strengthens the family, and that embraces the principle
Vlll
Foreword
that
you can
best achieve your financial goals
and per-
sonal aspirations by helping others achieve theirs. This
book
tells
you how we did
it
and how you can become
part of our vision.
And Jim
suitable
is
exactly right
when he
says that the only
ending for The Excel Phenomenon
is
one
that's
expressed by the words "To be continued ..." Because
whether you're from Wall Street or Main
promise you
this
—you
ain't
Street,
I
can
seen nothing yet!
Kenny A. Troutt
Chairman and Chief Executive Officer
Excel Communications, Inc.
IX
Preface
THIS
THE
IS
nity that
story of a remarkable business opportu-
open
is
to
and
all
Founded
I
as
simple to understand as
The company
using the telephone.
Communications.
is
call
it
calls
the Excel
itself
Excel
Phenomenon.
1988 by entrepreneur Kenny A. Troutt,
in
Excel entered the telecommunications industry as a
regional reseller of long-distance telephone service in the
aftermath of the breakup of
AT&T.
national player, having gathered
tomers in a
ing a
fiercely
dime on
become
or
service at
it
in
company almost
American
faster
than
history.
by purchasing blocks of long-distance
deep discounts and then enlisting hundreds of
service to
members of
ness associates in a
their families, friends,
own
resell that
and busi-
network marketing system. In the
many of these Independent
built their
security
cus-
celebrities. It has
thousands of Independent Representatives to
process,
a major
some four million
Hollywood
a billion-dollar-plus
Excel did
now
competitive business without spend-
TV ads
any new company
It is
businesses
Representatives have
and enhanced
their financial
by earning commissions from the long-distance
XI
Preface
calls
of the customers they sign up
calls
of their
from the
recruits' recruits.
Few would question
ness story.
as well as
that Excel
is
an interesting busi-
But why write a book about a long-distance
commands only about
reseller that
3 percent of just one
piece of a global telecommunications industry that will
surpass $ 1 trillion in worldwide revenues shortly after the
turn of the century?
something
much
My
answer
larger than
is
that Excel represents
itself. It is
embodiment
the
of some of the most powerful socioeconomic and cultural trends in
o
The
America today:
reaffirmation of the role of individual initia-
tive in the
o
The
life
of the country
creation of an entrepreneurship that
room
o
economic
for,
makes
and strengthens, the American family
The development of a new
business value system
based on the idea that capitalism works best
with an ethic not of "dog eat dog" but rather of
"people helping people"
The
story of Excel should be told, not because this
company
is
growing
faster
making money more
or
quickly than other companies but because
peoples
lives in positive
and big businesses have
tried
and
failed to do.
the vision to ideally position their
xii
changing
ways that both big government
Excel accomplishes this because
of the following events:
it is
its
leaders have
company
had
at the center
Preface
A global revolution in the demand for telecom-
o
munications services and technologies
The
o
steady evolution of American business toward
the powerful concepts of network marketing
The
o
transformation of network marketing
from
itself,
a product-based industry to a service-based
industry
The emergence of Excel
also vividly illustrates
how
the unleashing of free market principles in a key industry
can trigger a chain reaction of positive developments
that extend far
beyond that
are challenged.
New
industry.
Old assumptions
ideas are introduced. Mind-sets are
changed.
Think about
cally
For nearly a century, there was basi-
one phone company that enjoyed monopolistic
power
and
it.
in the marketplace.
economists,
Almost everyone
and
politicians
—
scholars
presidents,
giant
commercial customers and the individual consumer
simply assumed
that's the
way
it
and would
had
to be
the
breakup of that
always remain.
Then,
in
monopoly and
the early
the
1980s,
momentum
created by
it
opened an
opportunity for a young entrepreneur. Kenny Troutt,
who grew up in the housing projects of East St. Louis
and who knew nothing about telecommunications, was
able to start a long-distance
phone company without
installing a single switch or laying a foot of fiber into
the ground.
xiii
Preface
In
less
upstart
than 10 years, he and his partners grew that
company
into the fifth-largest residential long
distance provider in the nation. In the process, they cre-
ated an opportunity for tens of thousands of others to
start their
ment of
own home-based
a couple
hundred
businesses with an invest-
Some have become
dollars.
Many
multimillionaires in the process.
others have
achieved varying measures of financial independence
and
security.
Please understand that The Excel Phenomenon
a story with a
"To be continued ..." ending.
must be
One
leading
Excel Representative told me, "Jim, you're writing the
first
book about
Excel, but there's going to be
books written before we're through!"
When
I
started
work on
this
I
believe him.
book, the company had
announced, with considerable
just
many more
fanfare, that
it
was
beginning a gradual migration from being a switchless
reseller
of long-distance service to a company that
would back up
own
of
network.
that approach with the installation of
The
effort
was
its
to begin with the purchase
six state-of-the-art switches. Several
months
heard Kenny Troutt announce that the
switches were going to be installed in
later, I
first
New York,
three
Dallas,
and Los Angeles.
Then,
just as
I
was completing
my work,
new development was announced
that
a dramatic
shook the
telecommunications world: Excel declared that
acquire Telco
would
Communications Group, one of the
nation's 10 largest long-distance
XIV
it
phone companies, with
Preface
own network that includes $1 billion in installed
equipment. The deal would transform Excel overnight
its
into a
I
$2
company.
billion
have to admit,
how
fast
and
that's
and new
didn't even see
I
it
coming! That's
the telecommunications business
how
company
fast this
ideas. Steve
is
changing
is
embracing change
Smith, Excels executive vice presi-
dent of marketing and the architect of
network mar-
its
keting plan, told a group of Representatives recently that
they wouldn't recognize the
company
in a
figured he was merely engaging in a
rhetoric to fire
up the
few months.
little
I
razzle-dazzle
Now we all know better.
troops.
In tracing the footsteps of Excel from infancy to
today,
one can, of course, find
along the way. But for those
ties
that can
wisdom and
for those
count in our
you
as
From
who dream
come from challenging
still
much
false starts
as
it
who need
and mistakes
of the
possibili-
the conventional
reassurance that ideas
society, the story
of Excel will intrigue
did me.
a personal perspective, chronicling the achieve-
ments of Kenny Troutt, Steve Smith, Jack McLaine, and
dozens of top Excel Representatives has sparked a reexamination of my
own
life
For nearly 20 years,
I
and
have experienced
tunities to meet, observe,
greatest leaders in
career.
and work
for
many opporsome of
American business and
the
politics.
I
drafted radio and newspaper commentaries for Ronald
Reagan and served
as a senior aide to a California gover-
nor and a U.S. Congressman.
I
have flown around the
XV
Preface
country in the corporate
advising
tives,
jets
of senior business execu-
them on communications
writing their speeches.
My
strategies
international trade
and
work on
behalf of the state of California created memorable expe-
such
riences,
as participating in small
world leaders such
as
meetings with
Margaret Thatcher,
Britain's
Mikhail Gorbachev of the former Soviet Union, and
Corazon Aquino of the Philippines.
Moreover,
my
previous books
commercial opportunities in Vietnam, the
cations,
phenomena of Ross
ical
on business communipolit-
Perot and the Republican
Congress elected in 1994, and the pioneering network
marketing company, Amway, have afforded
me
close-up
exposure to a broad spectrum of watershed developments
in business
It
lenge,
and public
policy.
has been a career filled with excitement and chal-
one that has earned
me
a more-than-comfortable
income. But something has always been missing. By
focusing
on helping
others,
through communications, to
project their leadership, build their financial or political
fortunes,
own
and advance
aspirations.
in the trappings
and
it's
than
Why?
and
Because
status
safer to stand in the
it is
as
have neglected
my
politically
my
easy to get caught
up
long shadows cast by others
and
cast
your own.
George Deukmejian was winding
eight years as California's governor,
leave
appointed post
seek another government post,
xvi
it's
I
of the rich and powerful
to step into the glare
Seven years ago,
up
their ideas,
I
I
was preparing
as well.
to
Rather than
decided to branch out
Preface
on
my own.
Having been so
in California,
considered anything else to be a serious
I
letdown. Besides,
the contacts
I
power
close to the center of
I
reasoned that
had made into a
could easily translate
I
and
lucrative consulting
On a more serious note, I felt that
derive my livelihood from a government
lobbying business.
continuing to
job while vigorously espousing the virtues of free enter-
and limited government was
prise
a complexity soon to
blossom into a contradiction.
Governor Deukmejian put
to put
did
it
I
flopped!
Not
at least able to generate
so
much
insecure
and feared
made my
I
he
So
said.
financially, for
to build
rejection so
bills.
But
my own
much
I
I
that
I
was
free-
how
realized
business.
I
I
was
deliberately
pitch calls to prospective clients at lunchtime
and other inopportune times of the
that
is,"
enough consulting and
lance writing activity to pay the
knew about how
time
plainly. "It's
your money where your mouth
—and
little I
more
would miss them and
day, in the
hope
get their voice mail record-
ing instead!
I
lacked the discipline to
where there
pull
work productively
are dozens of excuses
and
at
home,
distractions to
you away from your desk. Perhaps most of
all,
I
missed the status and identity that came from serving
in high office.
It's
awful to be
known
as a "former."
I
was ashamed.
Within nine months,
government
office
stature than the
I
beat a hasty retreat back to a
and took
one
I
a job with less
had previously
left.
pay and
Since then,
I
xvn
Preface
have held several interesting jobs. I'm safe and secure in
the high-flying, pressure-filled world of political
commu-
nications. IVe got a fancy office again with a high salary
and
70-hour work week.
a
who implement my
proved
strated
own
For the
life.
my schedule.
my
I'm
own.
I
still
preach. I'm
haven't
still
who
those things that have proved so elusive to
haps to you as well. Going backstage
has emboldened
me
ever closer to
I
know
think
I
your
XVlll
and tracing
to the limelight
know where
especially the
who
tried to sign
will be soon.
you or you
I'm going
you
life is
By
me
the time
may
up! I'm not there
you
finish reading
be, too.
that this
is
the right business
find another opportunity to join the mil-
see that the choice
in
me
more than two dozen
of Americans setting out on their own,
to help
per-
personal day of reckoning. For
Whether you conclude
lions
—and
the people of Excel has brought
The Excel Phenomenon you
for
I'll
—
thank them
but
I
my own
Representatives
yet,
me
to get there.
Getting to
that,
not in con-
to prepare for another such journey
of my own. This time,
and how
demon-
have achieved
at Excel
from the shadows
leaders' journeys
haven't
have been given a rare
I
chance to meet a group of people
its
I still
standing in the shadows.
months,
last six
still
I
travel
I'm a player.
something missing.
can practice what
of my
trol
still
can stand on
I
I
there's
make my
instructions,
arrangements, and manage
However,
have wonderful colleagues
I
and the power
your hands and yours alone.
my
to
goal
is
change
Acknowledgments
NETWORK MARKETERS
try
you may be
LIKE
in business for yourself, but
you
are not in
We only succeed if we have the support
business £y yourself.
and encouragement of people who
The same
to say that in their indus-
holds true
there are endless days
when
trust
and
believe in us.
Of course
writing a book.
and nights
door slammed shut, the television
in solitude
off,
with the
the coffeepot on,
phone messages unanswered, back aching, head poundlooming, and ones temper snapping. But
ing, deadlines
what keeps us going
people around
a
is
the sustenance
we draw from
The Excel Phenomenon
us.
book written by one person, but
it is
may
the
have been
not a book that
was written alone.
Kevin Ganster
researcher,
is
a
tremendously talented
and editor whose contributions
writer,
book
to the
cannot be overstated.
The team
Silva,
at
Prima Publishing
— including
Susan
Kathy Daniel, Scott Pink, Karen Blanco, and
Steven Martin
—
is
first-class
Working with them
Tom Donohue
is
and professional
all
the way.
always a rewarding experience.
continues to spur
me on
endless energy and drive for excellence.
with his
own
Dick Lesher,
XIX
Acknowledgments
winding up nearly a quarter of a century of outstanding
Chamber of Commerce
leadership as U.S.
always inspires
me
president,
with his passion for America and the
free enterprise system.
My conclusions about Excel are independently drawn.
I
am
not part of the Excel business and derive no com-
pensation from the company.
Yet the people of Excel, starting with
and Steve Smith and carrying
right
Kenny Troutt
on through
to the
Presidential Directors
and Senior Directors, Eagle Team
members, and many
others, have provided a level of
cooperation and assistance a writer can only dream
You
are too
many
mention
to
here, but
I
am
of.
grateful to
each of you.
Excels Sharon
you. Relatively
Holman
new
deserves a very special thank
at her job
when
started
I
bombard-
ing her with requests and questions, she was never too
busy to help. Her support encouraged
step of the way.
whom
I
Two
The same
tive
tireless efforts.
must be mentioned.
Ben Dominitz, who with
Prima
Nancy, started
his wife,
in the family garage
and
built
publishing powerhouse
it is
today,
visionary
greatly every
goes for Gabrielle Farina,
cannot thank enough for her
others
me
it
into the innova-
is
and compassionate individuals
one of the most
I
have ever met.
The
idea to write The Excel Phenomenon began with Ben,
and
that's
something everyone should know.
Ben has published
grateful to
XX
him
all
of
for enabling
my work
me
to date,
am
of my
and
to achieve the part
I
Acknowledgments
identity that
I
lished a word,
like best.
I
would
But even
still feel
if
he had never pub-
greatly privileged to be
his friend.
The Vietnamese have
lated into English, says:
stay steady, there are
winds have blown
a proverb that, loosely trans-
"Even though the
tree tries to
winds blowing
all
around
around him,
my
friend,
all
Nguyen, has remained steady
it."
As the
Due Huu
as the strongest tree in
the forest.
Two
decades ago, he fled a failed war and a ravaged
homeland. Beginning anew
washer,
in this
country
as a dish-
he helped two dozen family members
oppression and build
college because he
new
lives here.
He
flee
never went to
was working too hard to ensure that
the next generation of his family could.
In the face of so
courage has
all
set a
challenges,
strong example for me.
he has done for
he has
many
me and
I
Due's quiet
thank him for
for the outstanding
example
set for others.
XXI
Note to the Reader
WHEN
BEGAN
I
the process of researching and writing
The Excel Phenomenon,
of Excel
as a
I
had only
company and no
Readers will surely note that
I
knowledge
a sketchy
opinions about
set
it.
have since come to the
conclusion that, on the whole, Excel
is
having a
signifi-
cant and positive impact on telecommunications, net-
work marketing, and on
who
the lives of
many of the
people
have joined the business.
While
access
I
have received an unprecedented
from Excel,
my
of
level
opinions and conclusions are
my
own. This book has been independently published by
Prima, a major U.S. publishing house.
I
am
not part of
Excel and receive no compensation from the company.
In this day and age,
work.
I
hope
it's
you'll agree
refreshing to find
easy to find things that don't
with
me
that
it's
kind of
and write about something that does.
James
W Robinson
xxin
Chapter One
A WINNING
COMBINATION
FRIDAY,
May
16, 7:00 P.M.
It's
hazy and
warm
in Los Angeles. In a cavernous auditorium of the
L.A. Convention Center, 1,500 people have gathered, having fought
through the rush-hour
traffic
and
shaken off the end-of-the-week exhaustion. For those
coming
directly
from
their nine-to-five jobs, there has
been no time for dinner. That will have to wait.
I
try to
form some generalizations about the people
in the crowd,
common
but
I
cant.
The only
with one another
is
thing they have in
that they're different
from
one another. Young people and old people, families and
single people,
and
men and women,
polyester, fitness buffs
suits
and blue
jeans, silks
and the wheelchair-bound
Chapter One
here
an ethnic and
is
Angeles
racial
melting pot
as diverse as
Los
itself.
Pulsating dance music, complete with lights and
crowd
the
lasers, jolts
and the crowd
stage lights up,
a lusty cheer.
to attention.
The
hall darkens, the
unison and
rises in
While much of America
lets
out
complacently
is
absorbed in thank-God-its-Friday pursuits, these people
are energized
and motivated. They have come
new and
of something
different,
and
in search
their journey
is
about to begin.
A
One
young man named Steve Schulz
takes the stage.
of the most successful of Excels Independent Rep-
resentatives,
that he
and
he begins by
his
boyhood
Hintze got their
first
pany seven years
telling the
friend
audience of the day
and business partner Pat
commission check from the com-
ago.
With
their wives
by
their sides,
they excitedly tore open the envelope and looked at the
grand
had
total: a
to split
it
check for 46 cents ("And don't
two
me
we
ways!").
Steve didn't care: "All
to tell
forget,
needed was that
I
that the system
was
in place.
It
first
check
worked." In
response to Steve's story, an explosion of cheers rocks
the hall.
How
on
does
it
work? With the aid of diagrams flashed
a big screen, Steve boils
terms.
The key
it
to success in
company, he explains,
is
down
to the simplest of
any long-distance phone
of course to build and grow a
customer base. Market leaders such
as
AT&T, MCI,
A Winning Combination
and Sprint do
this
by taking
a
generated from those customers
exact
—and
then spending
it
chunk of
—$3
the revenues
million a day, to be
on expensive
television
more customers.
advertising campaigns in order to get
This has been the basic business approach since telephone
deregulation and the breakup of the Bell system in 1984.
Excel does
it
differently.
The company
takes a big
chunk of money generated from customers and
to
Independent Representatives,
its
who
returns
in turn seek
more customers through network marketing. Because
new phone customer
or family
member
ad, Excel
is
is
rather than
from a
good
and
win
on
a
TV
seen.
situation," Steve assures the
The customers win because
service at a lower price
care about.
profit.
celebrity
building the most loyal customer base the
a win, win,
audience.
a
buying something from a friend
communications industry has ever
"It's
it
And
from someone they know
The company wins
the Representatives
building their
they're getting a
own independent
because
it's
making
win because
a
they're
businesses with loyal
customers and attractive long-term income potential.
Excel Today
The company
Steve Schulz was describing that Friday
night in Los Angeles has turned the telecommunications
business
on
its ear.
Chapter One
Founded
1988 by Kenny Troutt, chairman and
in
chief executive officer, Excel has quickly
become one of
the fastest-growing providers of long-distance
The company
cations.
communi-
currently serves four million long-
who
distance telephone customers,
used 6.3 billion
minutes of calling time in 1996; these numbers will
upon consummation of
expand
significantly
recently
announced plan
tions
is
to acquire Telco
Excel's
Communica-
Group. With about 3 percent of the market, Excel
Americas
fifth-largest long-distance provider in
of presubscribed
It
oping
terms
lines.
earned that status and customer base not by develits
own
switching and transmission networks but
by purchasing blocks of long-distance time and valueadded
ers
services at
and
reselling
Excel's
deep discounts from the primary
it
end
to
users.
growth has been astounding. In 1996, the
company's revenues totaled $1.4
increase over 1995.
billion, a
Only two other
on record have climbed
mark
carri-
as fast as Excel. In
their
May
way
167 percent
start-up
companies
past the $1 billion
1996, Excel became one of
the youngest companies ever to be listed
on the
New
York Stock Exchange.
Today, Excel
is
the
company everyone
is
talking
about both in communications and in network marketing. Indeed,
it is
the company's union of these two
erful industries that has resulted in
and formula
for success.
its
pow-
unique character
A Winning Combination
Setting the Stage: Growth and
Change in Telecommunications
Excel
would not
today were
exist
tiable appetite for the
it
industries
it
lutionizing our society for
show no
services.
The
tele-
has spawned have been revo-
more than 120
years,
and they
began when 29-year-old Alexander Graham Bell
walked into the patent
an application for
Bell
and
sign of letting up.
It all
file
society's insa-
telephone and an ever-expanding
array of communications products
phone and the
not for
office
his
new
on February
14, 1876, to
invention: the telephone.
had always been fascinated by the patterns of
speech and sound, and he had good reason to be. His
grandfather was a professor of elocution. His father was a
linguist
who
taught speech to the deaf and invented a
phonetic alphabet called Visible Speech.
was
but she was also a talented pianist
deaf,
of her ear tube on the sounding board.
sound could
tion that
first
who was
able
travel
It
was the
realiza-
along wires that created
sparks of the idea for the telephone in the in-
mind.
ventor's
One
day, while attempting to read a treatise
sound by
a
German
misunderstood the
scientist, written in
text to say that
German,
on
Bell
vowels could be repro-
duced electromagnetically and could
(What
mother
music she played by placing the mouthpiece
to "hear"
the
Bell's
travel over a wire.
the treatise really reported was that vowels could
Chapter One
be reproduced by a combination of electrical tuning
and
forks
resonators.)
With
this
skewed notion
in
mind, the inventor
found financial support from interested investors and
working on a harmonic telegraph, a system that
started
would allow more than one message
over a telegraph
to send
at
line.
more than
idea, so
pair
a single message in a single direction
to
back up for hours.
needed help with the mechanical aspects of
he hired Thomas A. Watson
worked
diligently for
as his assistant.
after
graph.
The only problem was
experiment to develop the harmonic
that
Bell then shifted his focus to
couldn't any
reasoned that
if
sound
his
The
months, conducting experi-
ment
Why
time to travel
At the time, telegraphs were unable
one time, causing messages
Bell
at a
it
tele-
didn't work!
an intriguing tangent:
travel over the telegraph? Bell
he could make a current of electricity
vary in intensity, precisely as the
air varies in
density dur-
ing the production of a sound, he should be able to
transmit speech telegraphically.
His investors weren't interested,
demanded
results
work on what was
on the harmonic
to be
become
however.
They
telegraph, so further
the telephone
became
a
clandestine operation.
A key challenge was
quickly isolated. Bell had to find
would
deliver the current necessary to
a substance that
transmit actual words.
battery acid
on
his
One
day, he accidentally spilled
telephone and on himself.
He
A Winning Combination
shouted, "Mr. Watson,
come
voice carried over the phone.
here!
I
want you!"
was the phone
It
call
Bell's
heard
round the world!
Down
Never a
Thus was born
Quarter
the industry that Excel leader
down
Kelly-Smith points out "has never had a
Meg
quarter in
over a century."
The
though.
invention initially had
The
its
doubters and cynics,
chief of the British Post Office was reported
to have said:
"The Americans may have need
we do
telephone, but
not.
We
for the
have plenty of messen-
ger boys."
Mark Twain
new
dismissed the
contraption with this
legendary put-down: "If Bell had invented a muffler or
gag, he
would have done
a real service."
Others reacted with fear and superstition. They were
afraid to talk to a
would be
disembodied voice and worried they
electrocuted.
Still
others
the
felt
phone was
simply another "gilded-age" toy for the upper crust
certainly not a
development that would
alter the lives
of
average people and society as a whole.
"Telephones are rented only to persons of good
breeding
and
refinement,"
an
early
reminded potential customers. Indeed,
$150
to lease a telephone in
New
it
advertisement
cost a fortune:
York and $100
Chicago and Philadelphia. That was
a lot
of
in
money
Chapter One
in the 1880s.
True to that "good breeding and
ment" mentality, many
in a
cupboard or
early customers hid their
installed a special cabinet to
refine-
phones
house the
instrument.
Even the now universal method of answering the
telephone went through several manifestations in the
very early days. Alexander
When Thomas
"Ahoy!"
device,
you
it
had
Graham
Bell always said
Edison worked on perfecting the
to be cranked first
and the user asked "Are
there?" Edison thought that took too long, so he just
said "Hello?"
The
early notion that the telephone
would remain an
extravagance for a small segment of society was quickly
proved wrong. Communications technology spread
wildfire
o
from day one, and
In 1878, the
first
it
o
Bell,
who was
him
to talk
began
o
The
first
service.
the Rutherford B. Hayes
president's first call
was
to
13 miles away. Hayes had to ask
more
In 1880, the
stopped since:
telephone was installed in the
White House during
administration.
hasn't
slowly.
public pay station in the world
For 10 cents paid to a uniformed
attendant, one could call anyone
who had a phone.
In 1892, telephone lines linked
New York and
Chicago.
o
like
By 1902,
the U.S. had 2.1 million telephones.
Just 12 years later, in 1914, that
multiplied to 10 million.
number had
A Winning Combination
New York and
o
In
o
On January 25,
1
91
1
,
telephone
call
Denver were
1915, the
linked.
coast-to-coast
first
took place, appropriately between
Alexander Graham Bell in
Thomas A. Watson
in
New York and
San Francisco.
came
o
In 1921, the
first
rotary dial
o
In 1927, the
first
overseas call took place.
o
In 1929, Herbert
into use.
Hoover became the
first
U.S. president to have a phone on his desk in
the Oval Office.
Today, 150 million telephone lines are in service in
America, and the usage works out to every man, woman,
and child
in
America spending 40 minutes a day on the
phone. Analysts keep looking for the saturation point,
but thanks to dramatic technological developments,
products, and insatiable customer
demand, no one
new
sees
it
anywhere on the horizon. Consider the industry of
which Excel
o
is
a part:
Operating revenues for
cation services exceeded
a
o
22 percent increase
Local, long-distance,
service,
first
communi-
billion annually
in just four years.
network
access, cellular
calling have
at double-digit or
through the
o
$195
and international
growing
telephone
all
all
been
even triple-digit rates
half of the 1990s.
Since 1990, long-distance calling, which
still
accounts for nearly 40 percent of revenues, has
Chapter One
grown
5 percent; local calling has
1
grown by
17 percent.
International calling has skyrocketed, with the
number of calls
increasing
since 1980. In 1994,
more than 600 percent
Americans spent
at least
$12.4 billion on 2.3 billion international
calls.
In 1994, 27 million people carried pagers. In just
three years that
By
lion.
70
number
the year 2000,
it is
expected to exceed
million.
Ten
years ago, just over
had
cellular
do.
has increased to 40 mil-
two million Americans
phones. Today, nearly 34 million
While average monthly phone
bills
have
been dropping due to cheaper, more competitively priced service, total revenues in the
cellular
phone market have increased tenfold
in
just a decade.
The number of 800 numbers
in use has
more
than doubled from 1993 to 1995 alone. Nearly
seven million are in use today, and we're running
out of numbers. In 1995, a
was created, along with
1
new number
(888)
5 additional standard
area codes in that year alone.
Even
ancillary endeavors, such as the publishing
of directories, have become hugely profitable
businesses.
According to Once Upon a Telephone,
by Ellen Stern and Emily Gwathmey, the
telephone directory had
Today
10
it
has over 5,000.
first
six business headings.
By 1994,
there were
A Winning Combination
200 Yellow Pages publishers
organizing, collating, printing,
over 350 million
phone
United
in the
States,
and distributing
directories
and generat-
ing over $9.3 billion in annual revenue.
to
It
may seem
like
From Monopoly
Market Mayhem
an anomaly, but an industry based on
continual advances in state-of-the-art technology has also
been, for
much of its
existence, a government-regulated
monopoly.
All that has changed. Today,
it's
one of the most
competitive, innovative, and entrepreneurial businesses
in the world,
with thousands of upstart companies drop-
ping in and dropping out. Consumers, for the most part,
are in the catbird's seat: despite initial confusion
sometimes annoying
sales pitches interrupting the
dinner, prices are generally going
and
quality,
how
it
accessibility
family
down, while the range,
of services are going up. Here's
happened.
In 1934, Congress established the Federal
nications
AT&T's
o
and
Commission (FCC), an agency
legal
monopoly on
regulating
the following:
The manufacturing of all phones,
cables,
communications products through
Electric
Commu-
its
and
Western
Company
11
Chapter One
o
All scientific research
through
o
its
Bell
and product development
Telephone Laboratories
All long-distance service
State Public Utilities
Commissions (PUCs) were
charged with regulating local telephone
service.
Both AT&T's monopoly and the regulatory oversight
was viewed
sal access
as the
and
most
efficient
way of achieving
service. In addition,
univer-
high capital costs
related to the installation of the telephone network, as
well as the labor intensity of the business, created a
wisdom
conventional
that maintained the following
three points:
1
AT&T deserved some market protection to
ensure
it
could eventually turn a profit on
its
huge infrastructure investments.
2.
No
other serious player could afford to enter
the market competitively anyway.
3.
Segments of the country and the populous
would be
ment
left
without service without govern-
regulation.
Between the 1930s and the
early 1970s, several
fis-
sures in the monopoly's foundation began to appear. In
1956, the government issued a Consent Decree prohibiting
AT&T
from developing new businesses and thus
taking advantage of the protection
12
it
enjoyed.
A Winning Combination
In 1969, a
tions Inc.
—
company
better
known
private-line service
years
later,
the
ket to other
The
called
as
Microwave Communica-
MCI —was
FCC
opened up the key
common
Two
private-line
mar-
St.
carriers in addition to
MCI.
year 1974 saw the beginning of a long ending to
antitrust lawsuit
the Justice
launched a more comprehensive
monopoly
decade
Louis.
between Chicago and
AT&T's monopoly, with an
MCI. Eight months later,
entire
allowed to offer
later
structure. It
would
on AT&T's
this case that nearly a
lead to the breakup of the company,
com-
the spawning of literally thousands of upstart
petitors,
Yet,
and the birth of Excel.
during
drawn-out process,
this
AT&T's monop-
oly enjoyed strong support from both parties in
most of big business, the FCC,
gress,
rival
Department
legal assault
was
by
state
Con-
PUCs,
the
Department of Defense, individual companies, and organized labor. So
Jeremy
MCI
why
Turnstall's
did support crumble? As detailed in
Communications Deregulation while
y
fired the first shots,
AT&T was
in fact beaten
by
three factors:
Technology:
trol the
almost
proved increasingly
difficult to
technology, as scientific advances were
daily.
company
vative,
It
con-
made
Big businesses increasingly began to see the
as technologically
and they complained
backward rather than innothat
AT&T failed to recog-
nize their needs for sophistication in communications.
13
Chapter One
Consumers, accustomed
to a plethora
of choices in other
product and service industries, had grown tired of the
availability
of one or two models of telephones and so
few options on the service menu.
Inflation: Persistent inflation through
1970s meant that
for,
much
of the
AT&T was continually having to ask
and increasingly having
to fight for, rate increases.
Monopolistic protection accompanied by governmentset
and -sanctioned
rates discourages efficiency
and
encourages bloat and bureaucracy.
Politics:
During the 1970s and
early 1980s,
AT&T's
leadership was defeated politically by failing to anticipate
that repeated exposure to the glare of congressional
mittee hearings
would
steadily sap
ing and public image. As
company
pulled out
all
it
fought
com-
its
strength in lobby-
its
court battles, the
the stops in Congress to prevent
legislation-mandated deregulation.
While such
itself
legislation
swimming
was prevented,
AT&T
against a strong current.
found
Sweeping
deregulation plans affecting aviation, trucking, and other
industries were picking
by the end of the
1
In 1981, both
up steam and would be enacted
970s.
AT&T
and the
Justice
Department
asked Judge Harold Greene for a postponement of the
long-awaited U.S.
v.
A T&T antitrust
trial.
Judge Greene
denied the request. The company saw the writing on
the wall. Faced with the prospect of endless indecisive
14
A Winning Combination
legislative battles, plus the
prospect of a hostile verdict
from Judge Greene and other lawsuits
AT&T
to follow,
agreed to a Justice-approved divestiture plan on January
8,
1982. In 1984, the breakup of
AT&T's
monopoly was completed. The company
regulated
divested itself
of the 22 local Bell system operating companies, which
accounted for the bulk of
its
revenues, profits,
and one
million employees.
It
—and
was the end of an era
the beginning of a wild
ride into the future.
Enter the Upstarts
"Bungled forays into computers, online
multimedia ventures are an old story
at
services,
AT&T,
and
but
its
core long-distance business was supposed to be a market
the
company had down
cold.
Week recently concluded. In
Not anymore,"
fact,
the post-monopoly
world has been a tough place for the telephone
Since 1984,
AT&T's
traffic
slower than the industry average.
Business
giant.
has grown at a rate
The
result has
been a
declining share of the interstate market, as measured in
minutes
—from over 80 percent then
to about
56 percent
by 1995. The company's share of long-distance revenues
suffered
an equally precipitous decline
90 percent
Even
distance
in
1984
— from
over
to 55 percent a decade later.
so, the initial
phase of the deregulated long-
phone market was marked by the emergence of
15
Chapter One
several big players
oly" of
—what
Business
AT&T, MCI, and
Week
calls
the "oligop-
As recently
Sprint.
1995,
as
they controlled 90 percent of the market.
It
was competitive, to be
sure.
Who
could forget the
multimillion-dollar television ad wars the giants of
the industry launched against one another to sway the
loyalties
of customers? To most of
us, the
We
noise was confusing and annoying.
it
competitive
simply tuned
out.
Today, thanks to companies like Excel, the oligopoly
has fallen apart just as the
ago.
"Tiny
rivals are
the telecom giant
monopoly did some 15
years
grabbing customers and blindsiding
[AT&T]," notes
Business Week.
"And
poised on the horizon are the massive Baby Bells, waiting
for regulators to allow
them
into long distance." In fact,
by the spring of 1 997, with both
service
opened
to an entirely
new
local
set
and long-distance
of players, another
expensive television ad war has broken out
all
over the
country. This time, the protagonists are local
companies protecting
their
phone
market shares by condemn-
ing long-distance providers, and long-distance giants like
AT&T defending their turf.
States Los Angeles Times business columnist
Flanigan: "Since 1984,
when AT&T's
regulated
James
monop-
oly was broken up, smaller companies have been responsible for virtually all
advances in telecommunications."
This has shaken investor confidence in
AT&T. The
company's public image had already taken a beating
16
A Winning Combination
when
announced
it
the downsized
as
a massive layoff in 1996.
AT&T employees
(Some of
have since joined Excel
Independent Representatives.) Today, investors see
AT&T's phone
coming under
business
anyone had expected. Prepaid
calling,
once
AT&T
or for any
it
siege faster than
calling cards
and Internet
perfected, pose additional risks for
is
company
that lacks the reflexes to
respond to a constantly changing business.
There's
no question
that
AT&T
is
looking over
shoulder at companies like Excel. Imitation
sincerest
form of
AT&T's
recently
for the
flattery.
is
its
indeed the
That's the reaction at Excel to
announced partnership with Shaklee
purpose of building a network marketing compo-
nent into
its
business.
Excel's Business Strategy
The
long-distance portion of telecommunications
is
already an $80-billion-a-year industry growing at a rate
of $500 million a month. In a climate of rapid growth,
deregulation,
and intense competition, Excel has
ished, thanks to a
First,
the
unique business
company
flour-
strategy.
has targeted two significant seg-
ments of the market:
1
.
Residential customers
spend
less
—
than $500 a
those
who
individually
month on long
distance
17
Chapter One
but
who
together
make up more than 50
percent
of the long-distance market
2.
Commercial
and medium-sized
service for small
businesses
Second, rather than incurring the tremendous capital
expense of installing
its
essentially kick-started
own
its
telephone network, Excel
entry into the business by pur-
chasing long-distance calling capacity from network-
based companies
deep discounts and reselling
at
it
to
customers.
Third, instead of hiring an expensive in-house,
employee-based
sales force
and buttressing
with a
it
costly national advertising campaign, Excel markets
distributes products exclusively through a
tens of thousands of
and
network of
Independent Representatives (often
called IRs).
Relationship selling
is
the basis of the business
opportunity Excel offers to these Representatives. Excel
Representatives are encouraged to build their
based business by seeking subscribers
among
own hometheir
imme-
diate circles of family, friends, business associates,
acquaintances.
It is
therefore ironic that
analysts have called
companies because
companies
their
name
public at large as the big three
Sprint). In the Excel plan,
have
as
you
as a
not
"Brand X"
as familiar to the
(AT&T, MCI, and
customer are
liable to
your long-distance provider your own
mother, son, or daughter.
18
some industry
like Excel
is
Who
and
would
call
father,
a family
A Winning Combination
member
or loved one "Brand X"? In this fashion, Excel
has put loyalty back into the long-distance telephone
business.
Fourth, Excel's products stress simplicity and continuity,
which
are
important attractions for today's con-
fused telephone consumers.
Unlike other calling plans, nothing changes
phone customer switches
or she realizes.
to Excel, except the savings
The customer
picks up the
dials
one plus the area code and number,
The
call gets
and on
when
phone and
just as before.
to a national digital fiber network.
will notice
no change
in their billing
either, since Excel has established billing contracts
most of the
local providers
customer convenience
is
who
issue the bills.
the fact that there
with
Adding
is
to
no mini-
usage requirement. Savings begin with the very
phone
first
he
routed through the local exchange carrier
Most customers
mum
a
call.
In addition to
ing, the
company
tions services
what Excel terms "Simply One"
call-
of other communica-
offers a range
and products that
are constantly being
expanded and upgraded. They include the following:
o
Discounted long-distance
o
Discounted long-distance commercial calling
o
800
o
International calling
o
Calling cards
o
Paging products and services
residential calling
service
19
Chapter One
In the works are plans to enter the local telephone
market and key international markets and to
ing services and residential
bank-
offer
electricity.
The Excel Opportunity
While the company
communications
offers
services to
resentatives a low-cost,
discounted, quality teleits
customers,
offers
it
Rep-
home-based business opportunity
based on the principles of network marketing.
By gathering
others to
a
few customers and convincing a few
do the same, the Excel Independent Represen-
tative begins earning
immediate cash income by
receiv-
ing a percentage of those customers' long-distance usage
each and every month. There are also cash bonuses for
bringing customers and other Representatives' customers
into the business quickly, stipends for training others
the company's behalf,
financial incentives,
increases the
and an
on
escalating schedule of
which grows
as the Representative
network of people he or she brings into the
business.
Immediate cash income, serious income potential
and long-term
that
residual income,
comes from building
one's
and the
own
great satisfaction
business
—
these are
the rewards that are today attracting tens of thousands of
people to Excel. You can enjoy these rewards and the
lowing benefits
20
as well:
fol-
A Winning Combination
o
There
o
You
are
no
collect
deliveries
and no inventory.
no money from customers
companies or Excel does that
o
There
no customer
is
a customer
local
for you.
risk. If for
dissatisfied
is
—
any reason
with the
service,
Excel will reimburse any charge for switching
back.
o
You have no employees, which means you
don't have to
worry about withholding, workers
compensation, or workers calling in
o
You
for
o
are not
anyone but
new
just
where you
No
experience
you with
When some
one of the
first
all
either.
You
don't
work
yourself.
You can build your
tomers and
o
an employee
sick.
business by gathering cus-
Representatives anywhere, not
live.
is
necessary. Excel will provide
the training
you need.
consider opening their
own
opportunities they look at
is
businesses,
a franchise.
According to Entrepreneur magazine, typical start-up
anywhere from a low end of
for franchises can range
$3,000
for a
fees
shopping-bag advertising company to a
midrange of $60,000
for
ture franchise to a high
an antique and custom furni-
end of $200,000 and up
for a
fancy car-wash business.
How much
There
is
does
it
cost to start an Excel business?
a fully refundable
$50 application deposit
to
21
Chapter One
become an Independent
Representative, for
receive the basic materials
and information.
which you
However, those serious about getting off on the right
foot choose to
become Managing
status provides
an IR with training, a
Representatives. This
home
office sup-
port system, newsletters, and Excel's bookkeeping and
accounting
become
a
There
services.
Managing
$50 deposit
is
a one-time
$195 charge
to
Representative, in which case the
waived, with an annual renewal of $180.
So, for less than
$200 per
year,
you need
to
might want
is
you can be
know
to
$200
is
do you
a
at the outset
than
less
in business for yourself. All
who
few people with a phone
a favor
by switching to a lower-
cost long-distance provider that saves
not rocket science
and
—
just the genius
them money!
It's
of common sense.
Matching Growth with Stature
By turning
loose
the "people power" of network marketing
on the booming, deregulated telecommunications
industry,
and by
reselling high-quality service at a lower
price rather than launching
its
phone system, Excel has made
own
a fast
capital-intensive tele-
and
significant
mark
in the business world.
Yet
when
you're living
on the freewheeling
frontier, as
Excel has done for the past nine years, there comes a time
when
initial
22
its
important to put
down
public offering on the
roots. In addition to
New York
its
Stock Exchange,
A Winning Combination
in the last several years the
important steps to position
Excel
is
company
itself for
has taken other
long-term growth.
a solid professional corporation with a top
management team and 2,200 employees
headquarters and
Addison, Texas,
its call
in
Houston and
centers in both
as well as in
Reno, Nevada.
has added seasoned executive talent to
It
ment team, such
Jack McLaine,
as
Dallas
its
now
manage-
its
the company's
president and chief operating officer. Jack was hired as
the company's chief financial officer in August 1994,
after a distinguished career that
own
firm,
included running his
which provided merger and acquisition
500 companies. He has served
vices to Fortune
financial officer
as chief
and president of international operations
for Pearle Vision Inc.
can National
ser-
and
as a vice president for
Ameri-
Can Co.
His ascension to the position of Excel president and
COO
comes on the
of two major company milestones:
ing in 1996 and
its
a strategic counselor
CEO
very
to Excel.
and thoughtful
cess
unique
The
Com-
role Jack plays as
Kenny Troutt became
During
my
clear
initial
his side, offering his
from
for
my
meeting with
cogent analysis
insights into the reasons for Excel's suc-
and the challenges that
Says
public offer-
and trusted business confidant
chairman and
Kenny, Jack was by
its initial
merger agreement with Telco
munications Group in June 1997.
first visit
management
heels of his successful
lie
ahead.
Kenny Troutt of Jack McLaine:
ability to
"Jack has a
view the Excel business model from
23
Chapter One
and
a global perspective,
services while bringing
Under
in the
to evaluate
all
product markets and
the business elements together.
his leadership, we'll
continue to
set the
standard
communications industry."
The company's plan
to build
its
own
switching and
transmission network through the purchase of state-of-
from Lucent Technologies,
the-art switches
decision to acquire Telco, begins a
new
as well as its
era for the
—an evolutionary development from
company
to
young
a reseller
a facilities-based carrier that will allow Excel to
become
a major competitor in a
communications
services
much
larger universe
and products.
Communications and network marketing.
ning combination. Yet
it
didn't
Alexander Graham Bell and
happen by
Thomas
than 120 years ago, the match was
vision
and
of
and drive of a determined
It's
a win-
accident. Like
A. Watson more
made because of the
leader,
Kenny
Troutt,
a dedicated partner, Steve Smith.
Excel at
its
able product
heart
is
a people business.
Its
most valu-
not telephone service but service to oth-
is
giving each person in the business the chance to
ers,
achieve his or her dreams by helping others achieve
theirs. It
why
it
is
impossible to fully understand the business,
works, and where
ideas, motivations,
people
who saw
I'd like to
going without probing the
backgrounds, and dreams of the key
the vision
and acted upon
it.
introduce some of them to you in the
chapters to come.
24
it's
Chapter Two
RIN6IN6 THE BELL
FRIDAY,
May
10, 1996, 9:30 a.m.
on the
clang, clang of the bell signaling the
the
day's
trading
on the
Exchange rings out over the
Kenny
leads, begins
1
"As
its first
I
York
Stock
bell
is
honor because
company he founded and
day of public trading, with an
1.5 million shares
The
opening of
Ringing the
Troutt, afforded the ceremonial
Excel Communications, the
ing of
floor.
New
nose.
offer-
of common stock.
watched our symbol, ECI, flow across the
dis-
play board of the world's most prestigious securities
exchange,"
Kenny
this giant step
day
in
said later, "I
means
to Excel.
was reminded of what
This was a momentous
our company's history."
25
Chapter Two
And
was a momentous day
it
in the life of
Kenny
Troutt. Stock offered at $ 1 5 per share nearly doubled in
price
on
that
first
day of trading,
effectively jettisoning the
48-year-old Texas entrepreneur into the ranks of Americas
billionaires
with the clang, clang of the closing
bell.
A Long Way from Home
It
was
a long
way from
the public housing project in
—
Mount Vernon, Illinois, where Kenny's mother affectionately known as Mama Nadine throughout the Excel
family
—worked
as a
school cook and struggled to raise
her three kids in the 1950s.
hood than any of
tells
was a rougher neighbor-
us can imagine," Kenny's wife, Lisa,
us today. Crime, violence, drugs,
activity
were part of the daily
Almost from the
start,
and intense
and hoodlum
life.
Mama
different in her oldest son.
the
"It
Nadine saw something
By age two,
the strong will
curiosity were already shining through.
young boy grew and became aware of his poor
As
sur-
roundings, he developed a strong drive to escape those
surroundings through entrepreneurship.
"Other boys were idolizing sports heroes and dreaming of the day they could
Kenny
recalls.
"But
I
26
and Fortune and wanting
them. They were
Kenny was
themselves up that way,"
remember reading about Americas
richest people in Forbes
just like
lift
my
heroes."
One
day,
to be
when
in the fourth grade, his teacher asked the
Ringing the Bell
students in class
up.
Some
what they wanted
to be
when
they grew
said a fire fighter; others said a doctor.
Troutt replied,
By age
"I
want
seven,
Kenny
to be rich."
Kenny
started his first business.
He
organized neighborhood bike races, enticed contestants
with a winner's trophy, which he made himself, and
charged them 25 cents for the privilege of competing.
He made
At
1 1
a
handsome
profit.
years of age,
ater business
—by
Kenny went
into the
movie the-
building a clubhouse in his backyard,
locating an old projector
and some home movies, and
charging kids 25 cents for a show, popcorn, and a Coke.
Two years later, the young entrepreneur established a
lawn mowing business. He bought mowers, hired his
brothers and cousins as employees, and
enlisted
went out and
customers. This was another profit-making
venture.
Kenny
the
lars
says he learned
enormous
from these
difference just one or
can make in most people's
early experiences
two hundred dol-
lives.
Faced with the
obstacles of a rough neighborhood, an absent father,
and the
responsibility as the oldest son to help support
his family, a youthful
choose from.
He
Kenny Troutt had two paths
to
could allow himself to sink into the
despair of his surroundings, helplessly eyeing from afar
with bitterness and envy those
who were
better off. Or,
through hard work and ingenuity, he could clear a path
of escape out of the housing projects to a
life full
of
opportunities.
27
Chapter Two
Why
do so many of us
passively accept the cir-
cumstances we are born into, while others
Troutt simply refuse to
escape and
rise to
special aunt,
and
let
Kenny
like
anything defeat or deter their
Kenny
the top?
credits his mother, a
guiding him to
his school coaches for
the right path.
For a poor boy from the projects, the only path to
college
was through a scholarship.
And
the only path to a
scholarship for a student with less-than-stellar grades was
through sports. "In
my
neighborhood, sports was
and make
the only vehicle to get out
Kenny
told me.
Southern
He
A football
money
still
churning
mate Pete Wittmann
—and 30
—
could to make a buck.
He had
to."
roomone of
still
"he did anything he
To help pay
as the breakfast
trucks.
for
cook
He
room
in their
sold water-
job was too good, no job was too bad," Pete
There were even
"Because
years later,
"He worked unloading
No
in
wasn't very long before
recalls that
and board, Kenny worked
fraternity.
it
in business again. College
Kenny's closest friends
we both
a
few outings to the
loved horses," Pete says
"The thing you have
to
track.
slyly.
understand about Kenny
that being deprived as a child gave
him
this
drive to be successful," Pete continues.
28
had done
and the entrepreneur-
tight
inside,
Kenny Troutt was back
recalls.
scholarship was his vehicle to
excelled in sports in college as he
drive
melons.
to college,"
it
Illinois University.
high school, but with
ial
really
is
tremendous
"He had
sur-
Ringing the Bell
rounded himself with successful people long before he
was a
success.
He wanted
to be just like them."
Think back on your
and
senior year,
it's
college days. You're in your
countdown time
Maybe you re cramming
to turn in a thesis. Perhaps there
will
be time for a backpack
mer.
What
new
degree?
Europe
trip to
kind of job can you land in the
in the
fall
sum-
with your
How will you pay off the student loans?
Kenny Troutt
transition
to graduation.
didn't wait for graduation to begin the
from student to working professional. While a
senior in college, he got a job selling insurance
and
quickly became his company's top salesman, earning
$75,000 a
and
year.
That was
nothing to sneeze
it's
As good
as
a lot of
money around 1970
at today!
he was, when Kenny inquired about an
executive job with the company, he was told that "he
wasn't
good managerial
furious, Pete
material."
Wittmann
recalls.
The young man was
Especially
when
shortly
afterwards a business magazine ranked the nation's insur-
ance companies in terms of quality and performance, and
his
company was
for
its
later
when forming
to run a Fortune
list!
So
Excel:
Kenny would
"One of my
500 company. Nobody's going
run one. So
I've
much
"good managerial material."
experience underscored one lesson
remember
to
very bottom of the
ability to recognize
The
me
at the
goals
is
to hire
got to build one."
Graduating from the university in 1970, Kenny threw
himself into a wide array of entrepreneurial
activities,
29
Chapter Two
from
real estate
He moved
ing business.
his
own
the
first
development to a basement waterproofto
Omaha, Nebraska, and
construction company, making big
time. "But he
plowed a
thoroughbred horse farm,"
lot
of those
his friend
started
money
for
profits into a
and frequent
busi-
ness partner Pete explains.
"And
through there, too. You
the winters were so long and
see,
his ingenuity
showed
cold in Nebraska that most of the racehorses were unable
to train
and build up
their strength until spring,
of the racing season was almost upon
us.
and
start
What Kenny
did was construct a pool for the horses to swim in during
the winter, so they were in far better shape far sooner
than others.
"Kenny's horses would be entered in races at 50-to-l
odds and win!"
The Road to Texas
Not everything went smoothly, however. The overhead
thoroughbred business were tremendous,
costs in the
and
in the late
stratosphere
and
—
real estate
some tough
attempt
1970s interest
rates soared into the
a less-than-ideal climate for construction
development, to say the
financial losses.
at marital bliss
On
ended
least.
There were
the personal side, a
in divorce.
So by the end of the 1970s, Kenny was ready
new
frontier.
He
chose Dallas and the
his dog, Ginger, as a
oil industry.
for a
With
companion, he loaded up
belongings in his truck and
30
first
made
his
way south
his
to
Ringing the Bell
When
Texas.
down on
the truck broke
baled hay to
make enough money
Kenny
the way,
to continue his
journey.
Knowing
working
nothing about
virtually
for a
company
familiar pattern, he
selling oil wells.
was tremendously
Kenny began
oil,
Following a
now
successful, attract-
ing investors such as Pete Wittmann, Bill and Susan Cas-
and Fred and Charlotte
ner,
years before, they noticed
Kenny
of
—
had anything
do with him
"He was
lotte, "If
do
Kenny Troutt
it. It's
we were
as
rare in
a person
has
awestruck by his sin-
is
says he's going to
investing in oil or later in Excel.
wife,
Char-
do something,
simple as that. In our view,
really investing in
Nadine
Anyone who
and how hard he works." Echoes Freds
cerity
he'll
a real professional.
to
Mama
something different and
Troutt. Fred Parrill remembers:
total integrity
ever
Like
Parrill.
it
wasn't that
What we were
was Kenny."
In fact, their faith proved so unshakable that even
when
the oil
cial beating,
boom
turned to bust and they took a finan-
they were
first in line
to invest in
Kenny
Troutt's next big idea: telecommunications.
Kenny eyed
from the
ing
new
gies,
AT&T
start that deregulation,
affordable personal
would
boom
the breakup of
look
trigger a
like a
boom
closely, believing
combined with emerg-
communications technolo"that
would make the
oil
poverty zone." Experiencing years of
tremendous highs and tremendous lows
like insurance, construction,
fatigable entrepreneur
some
and
oil
in businesses
had taught the inde-
vital lessons.
31
Chapter Two
"There came a point where
think about what
wanted
I
a business
wanted
to
had
I
do
to
sit
down and
of my
for the rest
life. I
where you get paid down the road
with residual income.
was looking
I
And I wanted
everyone needed, had, or used.
industry where as hard as
I
product that
for a
looked
to be in an
couldn't see any
I
limitations.
was 1988, and
"It
he could
that's
recall a precise
idea burst into his brain,
gestion.
He
when
I
moment
started Excel."
off the sug-
with giving him the idea of
breaking into the industry by being a switchless
He
credits Steve
Smith
for introducing the
keting approach to the business.
to Jack
McLaine
if
of inspiration when the
Kenny humbly waves
credits his brother
Asked
for steering the
And
he
is
reseller.
network marclearly grateful
company through
its ini-
public offering on Wall Street and the Telco merger.
tial
Drawing the
best ideas
—and
them
him
and
is
giving
from the best people around
credit for their contributions
—was
an appealing Troutt trademark.
But
at the
beginning what Kenny Troutt needed the
most was money.
"I
$50
remember
a barrel
excited," Pete
the
money
rich!
after the price
down
to $15,
Wittmann
you've got.
You and
32
cards.
I
"He
went from about
"Send
it all,"
me up
'Send me
called
all
said,
all
are going to get
mega-
anyway?'"
Kenny he had about $20,000
and maybe another $20,000
bank
oil
Kenny
told me.
How much have you got,
Pete told
of
in the
in available credit
Kenny
told him.
bank
on
his
Ringing the Bell
worth
"Soon
as
did that
and on weekends
to
did,
I
all
wife," Pete says.
extra
—without
forty grand
"So
I
telling
working
started
I
my
pay back those credit cards
before she found out."
Casner was ready to help
Bill
Kenny
Omaha
in
25 years
as well.
earlier (he
and
He had met
wife, Susan,
have been close friends of the Troutt family ever since).
"After
we both
very well until the bottom
Kenny
night,
fell
out of oil
called
telecommunications business.
was
finally
got into the
oil
"And we were doing
business together," Bill told me.
"One
we
gravitated to Texas,
prices.
me all excited about the
He was convinced this
home run he had been
look-
in the very early days.
"The
going to be the
ing for."
remembers Excel
Bill
whole company consisted of a 150-square-foot
office, a
couple of desks, and a couple of phones," he
says. "I
remember when Kenny was
the only employee.
He
answered the phones, he negotiated the contracts to buy
long-distance minutes, and he went out and signed up
the customers.
An
cess
did everything."
original Excel investor, Bill felt the
were long.
had met and
it
He
work.
I
"I
knew Kenny was
that he
could
live
not endure watching
tial like
nothing
I
would
give
it
with losing
it
hit
like
no other person
his life
my
money, but
without me.
It
We had
we should have had $3
less
million.
I
could
had the potenin.
We
than $400,000
I
I
blood to make
had ever been involved
really undercapitalized.
odds of suc-
think the
were
when
money
33
Chapter Two
problem Excel faced
became
at the outset
is
one reason Kenny
so determined later to offer Independent Repre-
sentatives a chance to get into business without a lot of
capital.
such a handicap for most small businesses
It's
but not for Excel businesses."
The
tignon
Parrills,
all
the Casners, and
Dan and Linda Mar-
stepped up to the plate, too. "Kenny was so
excited," Charlotte Parrill recalls.
"But he didn't pull any
He warned us there were no guarantees. But we
much faith in Kenny that we took all our money
punches.
had so
out of our savings and just handed
over."
it
"There were no contracts, no signatures.
we
didn't
need to be concerned about
that,"
We knew
adds Fred.
Today, living comfortably on the wealth they've
from that simple
realized
act of trust
and
loyalty ten
years ago, the Parrills call themselves "the classic Cinderella story."
For
Dan and Linda Martignon,
one investment that
finally
Excel represents the
worked
out. After his first
wife passed away in 1982, "I started making
type investments,"
Dan remembers.
three-ring binder listing
such project was an
all
the projects that failed."
invested in couldn't afford to cap.
and agreed
to take
mailing
of investors.
list
me from
that
"Kenny
in
34
an
oil
list,"
really
it
Dan
took
well together,
One
company he
"Kenny Troutt came
over and cap
I
"In fact, I've got a
well that the
oil
some wild-
it
in
in
exchange for the
met Kenny when he contacted
told me.
me
and
under
I
his wing.
We
invested
remember driving out with
Ringing the Bell
him
in the
morning
to see if
was going to be a
it
As we approached, Kenny saw the
and knew
right then
was on the
It
about his
new
it
had
trip
rig
success.
being dismantled
failed."
back that Kenny started talking
To Dan, who
idea in telecommunications.
had spent much of his professional career working
area
manager
crazy. "I told
me
for Southwestern Bell, his ideas
Kenny he was
he understood and that
thought about
for a
it
Why was Dan
"When Kenny
after
and
it
"Kenny
second and
told
sold our oil lease
back or invest in
said,
I
his idea.
'Okay, I'm in.'"
—even
the gusher that never gushed?
decides to do something, he always goes
one thousand percent.
cares
says.
an
sounded
willing to take such a chance
money on
after losing
Dan
when we
my money
could either get
I
nuts,"
as
He
always follows through
about each and every investor.
I
just couldn't
take the chance not to be involved."
Dan
Today, at age 58,
is
taking an early retirement to
He and
help raise four grandchildren.
his wife, Linda,
have found Excel gatherings a rich source of lasting
friendships.
such a valuable part of our
It's
not talking about the money,"
really
Dan
says.
As
for Pete
day back
in
lives
Excel. "She
is still
1993 when he told
wanted
accommodating,
I
I
are
this business
is
around."
Wittmann, he
had enough saved
and I'm
Linda and
caught up in the excitement of how
turning people's
lives,
trying to forget the
his wife that they
now
to cash in their original shares in
to. I didn't,"
agreed to
Pete told me. "But to be
sell
enough
to at least get
35
Chapter Two
back the original $40,000 we put
company went
in." Later, after the
public and a market value was established
for his remaining piece of the
company, Pete
realized
it
was a decision that cost him millions of dollars!
As
is
for
Kenny, the former frat-house breakfast cook
Pete surprised that his friend
is
now
at all," Pete says. "It doesn't surprise
"But
am
I.
he's still the
Recently,
I
I
bit.
my
on paper anyway, by millions of
You know something,
at the track
and
so
lost
found out that the stock market
took a tumble and the value of
c
me one
"Not
same guy he always was, and
had a bad day
$700. That same day
a billionaire?
that
Excel stock dropped,
dollars.
$700
I
told Kenny,
I
lost at the track
hurts more!'"
Finding Real Happiness
As Kenny was building
Excel, propelling
it
to unprece-
dented growth and helping thousands find personal happiness
through entrepreneurship, a chance meeting
through friends changed his
met
in a
wonderful way.
He
Lisa.
"I
grew up
in a small
recalls.
"We were
family.
We
home with
town near Houston,"
three children
from a
close
Lisa
and loving
were fortunate that our mother could stay
us.
My
worked long hours,
and motivating us
36
life
father
owned
his
own
business and
yet he was constantly encouraging
to follow
our dreams."
Ringing the Bell
North Texas
Lisa attended the University of
in
Den-
ton and graduated with a degree in fashion design. She
then began a successful and enjoyable career in Dallas
working
ness,
for
but
major apparel companies.
always
I
knew my
focus
"I
loved the busi-
would eventually be on
raising a family.
"When
I
met Kenny
knew
I
was something very different and
this
day she marvels
away
that there
about him." To
special
when
at the fact that
was that he worked
told her
right
they met,
all
he
for a long-distance tele-
phone company. "That's what he
told everyone.
When
he met them, he never bragged that he started the com-
pany or
that he
was the CEO."
Kenny and
After dating for a short time,
they had each found the
real thing.
Lisa
knew
The couple was mar-
proud parents of two
ried in 1993. Today, they are the
young
sons, Preston Allen Troutt
and Grant Michael
Troutt.
The
into a beautiful
home
in
family recently
moved
new
one of Dallas's most prestigious neighborhoods.
Even though building Excel into the Fortune 500
company Kenny dreams
amounts of his time and
tive side.
lives.
It's
it
to be
energies, Lisa looks at the posi-
"Excel has brought so
This company
consumes enormous
is all
many
people into our
about touching people's
lives.
taking the time to listen and caring enough to help."
Despite family responsibilities and numerous functions
not
and appearances
lost
her focus on
related to the business, Lisa has
how
the
company can impact
the
37
Chapter Two
of a single individual. During the company's annual
life
"Excelebration" convention in September
1996, she
emotionally told the story of misfortune that had
befallen a friend.
"Just before
friend of
called,
was
we moved
mine who ran
a
new
into our
showroom
house, a good
Apparel Mart
at the
and she was very distraught. Her father-in-law
in the hospital
and not expected
to live.
She had to
go and be with her family, but she was worried about her
business.
Could
I
help?"
With two young
children at home,
possible time for Lisa
— "But
a
it
was the worst
good friend would be
there."
At the showroom, one of the employees
vised
had not been working
for very long
Lisa super-
and was seven
months pregnant. Her husband had been unemployed
for a year.
"They had no health insurance and were going
to garage sales to find maternity clothes.
was
plaining. She
The
first
telling
me
She wasn't com-
this cheerfully," Lisa says.
thing Lisa did was bring in some of her old
maternity clothes for the young
about Excel,
how
she could
her
all
her
new baby and
this
woman's husband had been
Lisa reflected
really
on the
woman. "Then
work
at
change her family's
a teacher
fact that Excels top
made more than $35,000
job. Lisa told the
38
told
home with
life."
and
Since
a coach,
money
Paul Orberson, was a former high school coach
never
I
earner,
who had
a year at his previous
young employee, "You know some-
Ringing the Bell
and coaches have
thing? Teachers
a really
good track
record in Excel!"
Paraphrasing a passage from Proverbs, Lisa Troutt
believes "It
is
is
There
reaching
no
is
down and
In speaking to
is
better exercise for the heart than
lifting
Kenny
people up."
Troutt, giving people a chance
clearly the mission that defines Excel.
approach brings to the
for everyone to
new
richer. It
hold on too tightly and lose every-
also possible to
thing."
away and become
possible to give
he told me,
table,"
change their
"What our
"is a
chance
Eighty-five percent of
lives.
businesses go broke in less than five years. So
what
we've tried to do for our Independent Representatives
to clear as
You
many
obstacles
from
their path as possible.
You
don't need an inventory.
is
don't have to under-
stand distribution, warehousing, or shipping, and you
dont have
you have
to
an expert in telecommunications. All
to be
do
is
see the vision.
"Unlike a product such as cosmetics, which you
could argue
is
only used by a
maximum
of 50 percent of
the people, everyone has a telephone. Everyone
knows
how to use the telephone, and they're already spending
money on it." Kenny emphasizes the simplicity of the
business. "When our Reps go out to get customers,
they're not
even asking those customers for any money.
Just use our service."
If
one expects
to hear corporate
buzzword babble or
from
this chief executive,
abstract, intellectual posturing
39
Chapter Two
they can look elsewhere.
and
plainspoken
is
and he exudes confidence and conviction
direct,
with everything he
"It
Kenny Troutt
me
took
says.
how
a couple of years to figure out
I
could play their game," he says of Excel's giant competitors.
"Now,
to varying degrees, they're
trying to copy
all
our approach and take our business.
"The problem
they're
going to have
marketing takes a special breed of people
by
different goals
rate world.
in
The
is
that
who
and dreams than people
network
are driven
in the corpo-
big companies won't allow that. In fact,
most major companies, once a salesperson makes too
much, they
either cut his territory or
promote him
to
management."
Excel places no such limits on what an individual can
achieve.
With
great satisfaction,
Kenny
notes that former
high school coach Paul Orberson, Excel's top
earner,
money
"makes more than the heads of AT&T, MCI, and
Sprint put together!"
Yet
money
Kenny
alone
can't relate to
is
not the driving force. "Most people
is
making
people won't," he
to achieving
quick to emphasize that for most,
says.
a million dollars a year,
and most
"But almost everybody can
economic independence." He
neering companies like
Amway
multilevel marketing business
relate
credits pio-
"for cleaning
up the
and paving the way
for
people like us." At the same time, he proudly notes
Excel's relatively
ers
40
compared
low
attrition rate
to other
among
its
practition-
network marketing companies,
as
Ringing the Bell
well as
its
unusually high appeal to upscale, white-collar
professionals.
"When
cent of
started Excel,
I
I
had
has said. "So
that people could
per month,
In
65 per-
personal bankruptcies could be avoided
all
month
debtors had just an extra $185 a
Kenny
just read that
figured if
I
do
to
make
I
addition
to
telecommunications,
contributions
is
bringing
Kenny
$150 or $200
just
extra
lives."
network marketing
believes another
that "we're the
income,"
could find something
could help change their
I
in cash
if
of Excels big
to get in front of
first
to
and
even ahead of the consumer on a one-to-one basis." By
emphasizing
sales to
family members, friends, and associ-
Excel Reps build up tremendous customer loyalty
ates,
and a ready entree
for the introduction
Echoes Jack McLaine: "Relationship
to
sell
of
selling
new
is
products.
the best
way
long distance because of all the noise out there."
Perhaps most significant of
all is
that a
company
like
Excel offers living proof that capitalism can thrive in a
culture of "people helping people" rather than "dog eat
dog." Steve Smith points out, "Since the very beginning
and
for
right
up
to the present day, there
Kenny Troutt than
we've
made
to Reps. In
they were in
life
greater thrill for
"He
to review each
when
many
cases,
is
no
new
greater thrill
list
of payouts
we know how down
they started, and there's just no
Kenny than
to see
them succeed."
truly believes his road to success
is
paved by
helping others get there too," says Lisa Troutt about her
husband.
41
Chapter Two
New
From
every day.
profiles in the publications Success, Inc.,
and Fortune
Forbes,
popping up almost
signposts of that success are
to being
named
the 1996 Southwest
Area Entrepreneur of the Year and the Ernst and Young
Entrepreneur of the Year, Kenny Troutt
becoming
is
quickly
a legend of American business.
Perhaps
most
the
gratifying
of
recognition
all
occurred on October 14, 1996. That was the day Forbes
issued
most recent
its
America.
On
that
list
list
of the 400 richest people in
was a
man who
as a
boy growing
up poor pawed through the same magazine, vowing
himself,
"Someday I'm going
Where
in a
else
but in America could a boy lying in bed
dream of making
it
river
to the ranks of the nation's wealthiest
— and through hard work and an
supply
come
to be just like them!"
housing project on the wrong side of the
people
to
of entrepreneurial
drive
inexhaustible
make
dream
that
true?
As young people today growing up
in similar
tough
circumstances grasp for that one-in-a-billion chance of
becoming the next
we can only hope
cans like
solid
Kenny
sports hero or entertainment legend,
more of them look up
to
Ameri-
Troutt. His dreams were built
on the
that
bedrock of American
free enterprise,
not on the
near-impossible odds of professional sports or the fleecy
clouds of Hollywood's dream factory. Dozens of people
I
talked to in the Excel business, from the spectacularly
successful to those simply bringing in
cash, are
42
unabashed
some
in their description
helpful extra
of Kenny Troutt
Ringing the Bell
"our hero."
as
To
this day,
up
to
not a
It's
title
Kenny
carries comfortably.
he admits being nervous whenever he gets
make
a speech, even
most fervent
when
he's
fans.
For years our popular culture has
people.
The
speaking to his
vilified business-
higher they have climbed, the
more
viciously
they have been portrayed. In a society that hungers for
heroes and whose children desperately need positive role
models,
we should
dates exist
ers,
consider that
among our
and industry
some of the
best candi-
entrepreneurs, small business
leaders, for
own-
what they represent
are
duplicable dreams, not virtually impossible fantasies.
What Makes a Leader?
What
are the qualities that enable a leader like
Kenny
company and
inspire
Troutt to build and steer a large
thousands to place their faith and hopes in his hands?
Generalities are hard to draw,
definitions of what
and
constitutes a great leader change with the times.
times
I
we
just
have had
many world
know
many
it
when we
see
it.
During
my
Somecareer,
opportunities to personally observe
leaders in a variety of settings.
In 1988,
I
sat four feet
away from
Minister Margaret Thatcher in 10
British
Downing
Prime
Street as
she passionately described the West's final struggle to
free Eastern
the
room
Europe and Russia from communism.
absolutely awestruck, never having
I left
felt
so
43
Chapter Two
confident that freedom would ultimately win out in
that struggle.
In 1989,
I
watched Philippines President Corazon
who had
Aquino,
already survived several coups and
and whose husband had been
assassination attempts
gunned down
form
I
several years earlier, sit serenely
crowded Manila park waiting
in a
on
a plat-
to give a speech.
was astounded by the apparent lack of security and the
multitude of places an assassin could be hiding. As her
generals
and
aides sat
around her fanning themselves and
sweating heavily in the 100-degree heat, Mrs. Aquino sat
with a half-smile and not a bead of sweat on her
She appeared to be
Her
quiet strength
I
in a state
of complete
face.
tranquillity.
and courage amazed me.
have been in receptions
at the
White House during
both the Jimmy Carter and Ronald Reagan administrations,
and
I
president had.
was struck by the different impact each
As President Carter entered the room, peo-
ple were milling about
tions.
on
Despite the presidents presence, people kept right
talking.
was even
ilar
and carrying on various conversa-
It
was a
there. Yet
venue
full
when
minute before they
realized
he
President Reagan entered a sim-
several years later,
no one missed
The impact was immediate and
his presence.
the reverence palpable.
There may have been a time when Americans looked
for
flamboyance and even a degree of noblesse oblige
from our
leaders.
Today,
we
still
value those leaders
are strong, principled, courageous,
and capable of con-
veying a vision that excites us and uplifts
44
who
us.
Yet
we have
Ringing the Bell
little
patience for arrogance and artificiality and for lead-
who through their words, actions, and demeanor let
us know how much better and smarter they are.
We want leaders who communicate to us, not down
to us, leaders who understand the experiences and lives
of average people but who still act like leaders.
During the many opportunities I have had to observe
ers
Kenny Troutt
in recent
months
—
in private meetings,
home
before large groups, in his office, and in his
—
have tried to link the qualities that people see in him
with those qualities
When
have observed in other leaders.
he walks into a room, his presence
immediately:
attired
I
but
is
strong, direct, focused.
it's
in
no way flamboyant
demeanor, or expression.
Troutt, his focus
He
probing.
is
a
is
When
listener,
sharply
is
in either appearance,
you're talking to
on you and
good
He
his gaze
is
say.
people in the Excel business used the words
versations with Kenny,
exactly
where
person
who
he's
I
my
con-
who knows
goals are. He is a
sense a person
going and what his
does not suffer fools gladly, whose simple,
direct speech,
unadorned by big words, could conceiv-
business competitors and others into thinking
lull
he's
not
he's
more
The
and
but he does not patronize
"focused" and "committed" to describe him. In
ably
Kenny
direct
you by gratuitously agreeing with everything you
Many
felt
is
as
sharp or as crafty as they are
likely to
—when
in fact
be three steps ahead of them!
self-confidence, the ceaseless supply of energy,
the plainspoken ability to motivate others, the sense
you
45
Chapter Two
get that he has never forgotten
these are the qualities
Close friend
and
says.
Casner has reflected carefully on the
Bill
success. "First,
it's
"Kenny has nerves of
walk away from the
endurance.
last
have seen in Kenny Troutt.
account for the Kenny Troutt brand of leader-
traits that
ship
many
where he came from
No
the negotiating skills," Bill
steel.
He's always willing to
table if he has to. Second,
one can outwork him.
him, whether
it's
a
No
Kenny
has
one can out-
marathon negotiating
session or a
crash project needed to solve a problem or take advantage of an opportunity. Third, he has outstanding mar-
keting
skills.
Fourth, he knows the numbers better than
anyone. He's a great
on
solving problems
number
—and
cruncher. Fifth, he thrives
believe
me, in the early years
of this business there are plenty for him to thrive on!
"Finally," Bill explains,
he takes a
of people with him
lot
der of success.
Whether
he brings
tives,
"Kenny always makes
as
as
Troutt
who
feel
many
a
he climbs the lad-
they're investors or Representa-
people along
can. This has created thousands
people
as
and thousands of
tremendous loyalty
—and he has earned
he possibly
to
known him
for
today that he was the
25 years and
first
Kenny
it."
Success and wealth haven't changed him, Bill
"I've
sure
day
I
he's the
insists.
same Kenny
met him."
Indeed, you don't get the feeling you're talking to a
billionaire
when
you do know
46
you're talking to
for sure that
you
Kenny Troutt
— but
are talking to a leader.
Ringing the Bell
Calculating the Incalculable
Visitors to Excel's executive offices in Dallas today are
struck by a large glass-enclosed display in the lobby con-
mementos marking
taining photos, awards, and
major milestones
and
in the life
Excel. Prominently
piece
is
high
as
and history of Kenny Troutt
and proudly featured
a small desk calculator
nine
as a center-
whose display goes only
as
company rendered
it
Kenny and
digits.
the
his
obsolete the day they crossed the $1 billion milestone.
It's
there
no doubt
family has come.
came from,"
reminder of
as a
"Kenny
how
far the Excel
will never forget
where he
says his friend Fred Parrill.
Meanwhile,
go back to that gathering of 1,500
let's
current and prospective Excel Representatives in Los
Angeles described
stage,
at the
Kenny Troutt
is
beginning of chapter
1
.
Back-
concentrating on the speech he
about to make. His job
is
to share with the
is
members of
the audience his vision of the future of telecommunications
and Excel and
their place in that future.
It's
no
small task. Meanwhile, Executive Directors Greg and
Carolyn Beck approach him with a request.
one of the Representatives
woman named
who had been
les,
in their group,
It
seems that
an 82-year-old
Vivian Hankins from Tulare, California,
looking forward to the
trip to
Los Ange-
has instead been rushed to the hospital back
home
with a serious heart ailment.
47
Chapter Two
"She
lives for Excel,"
start until she
she does
all
turned 81. Because
her recruiting from
became
She
the Becks
Senior
a
me. "She didn't
tell
poor health,
she's in
home
over the phone.
Representative
in
just
four
months."
The Becks
hospital,
Troutt.
ask
Kenny
if
and he makes the
How
phone and
are
you
he could
call.
feeling?"
He
yell
embraces a
says, "I love
staff
now
in
"My mother
take as
Kenny Troutt.
48
up from the
you can come down here
you, too."
listens
He
poor health and living
and
a
Mama
in Florida?
He
takes the stage.
always told me: 'On the
many
for
hangs up and
member. Was he thinking about
returns to the auditorium
stars,
Kenny
Vivian, "Well,
tells
and cheer even louder." He
moment, then
Nadine,
looks
is
says, "She's crying!"
get better so that next time
and
Vivian in the
"Vivian, this
Returning to the phone, Kenny
you
call
people with you
as
you
way
to the
can,'" says
Chapter Three
"THE MOST IMPRESSIVE
THING I'VE EVER SEEN"
ACCOUNTS FOR Excels meteoric
WHAT
both
and telecommunications?
rise in
business
Clearly, Excel offers state-of-the-art tele-
communications products and
services for
nation and the world have an insatiable
which the
demand
products that everyone uses, needs, and can understand.
Equally important
is
Excel's
embrace of the
fastest-
growing approach to business in the world today: net-
work marketing. The company has
built
upon
the
triumphs of the pioneers of network marketing and has
learned from their mistakes
business plan to
plicity
and that
its
is
—
as a result,
Excel offers a
Representatives that strives for sim-
constantly reengineered to help people
make some money
as
quickly as possible.
It is
one of the
49
Chapter Three
cheapest and most accessible ways for individuals and
without capital or specialized knowledge, to
families,
build their
The
own
businesses.
principal architect of what
opportunity
is
Kenny Troutt
man named
a
you
will tell
known
is
as the Excel
Steve Smith. Founder
that
much of the
credit for
unique business approach and culture belongs
Excel's
to Steve.
Chasing a Dream
Sometimes good can come from bad. That's the way
Smith looks
Steve
his father
dad
in
the
at
when he was 37
out he had with
falling
years old
and working
for his
the family paint manufacturing business in
El Paso, Texas.
"I
father,
had never worked
and one day
for
anyone
else
things
up
we
later,
right away,
discussed
and he
said,
why we
'Because
were going to come back and talk to
things out.'
And
going to do that
I
my
1982 we had an argument and
in
quit the business that day," Steve recalls.
because years
except
told
my
father,
'I
I
"It's
I
funny
didn't patch
thought you
me and
straighten
thought you were
too!'"
Neither one did, so Steve found himself with a wife
and two children
to
support and absolutely no idea
about what he was going to do with his future. The
Smith family relocated
50
to Austin, Texas,
where Steve
"The Most Impressive Thing
and looking
started brokering paint products
foothold in business.
worked
"My problem was I had
anyone and
for
want
didn't
Ever Seen"
I've
to start.
for
a
never really
But
had no
I
sense of direction."
It
was a lousy time
in Texas to try to find yourself,
economically or otherwise.
many Texans
The 1983
"A doctor friend of ours
property he owned.
When we
It
had
day, a friend told Steve
easiest prospect in the
"He showed me
and
a plan
marketing," Steve told me.
somewhere, we
to get
about a way he could
that point, Steve
this
a video about relationship
many who
"Unlike
time,
I
I'd
ever seen."
He jumped
right in,
of health food and diet supplements. "But
selling a line
like
first
are
concept of relationship marketing was the
most impressive thing
seemed
was per-
world for such an appeal.
exposed to such a presentation for the
thought
remembers.
was a tough time."
make "buckets of money." At
haps the
car," Steve
us stay for free in a rental
let
caught a ride from friends.
One
bust brought
to their knees financially, including Steve
"We had no home and no
Smith.
oil
about three minutes
the
later,
it
company went
out of business."
Steve Smith was back where he started
really,
because for the
The wheels were
"Then
I
He
couldn't get
it
out of his head.
turning.
came upon
network market plan
made
not
time he had grasped the power
first
of network marketing.
— but
a
company
that
was developing
a
for U.S. Sprint," Steve explains. "It
a lot of sense to
me, because
it
seemed
like the
51
Chapter Three
purest form of this business concept. Everyone could do
a
work gathering customers
little
for a product line that
everyone needed and which enjoyed great credibility
telecommunications
industry where
I
services.
wanted
to
I
decided
was the
this
do network marketing.
I
couldn't see myself pushing diet pills."
With telephone
deregulation just underway and net-
work marketing of phone
was rough going
services
for Steve
and
still
in
its
his family.
infancy,
it
He worked
with a couple of communications firms but from his perspective
still
struggled to find financial traction and pro-
fessional satisfaction.
In early 1988, Steve
what
its like
you know
know
Troutt.
when you meet someone
instantly that this
better? That's the
Kenny," Steve fondly
Steve's
met Kenny
first
time and
a person you've just got to
is
way
the
"You know
it
was
for
me when
I
met
recalls.
mission became to
sell
Kenny Troutt on
the
idea of using a network marketing approach in his fledgling Excel
Communications. Steve
feed, however. "I
was driving back
still
had
a family to
to El Paso to visit
my
— and hopefully borrow some money! —when
family
noticed those decorative strings of red
hanging on
ristrasy
all
the doors in
chilies,
I
called
West Texas. So
I
returned to Austin with a truckload of them, set up shop
on the
side of the road,
"So
selling
52
I
went back
them by
for
and sold them
all
more, and before
the trailerfull.
I
in half a day.
I
knew
it, I
was
cleared about $50,000
"The Most Impressive Thing
very quickly during the
fall
I've
Ever Seen"
season of 1988.
interesting experience sitting in a truck
on the
It
was an
side of the
road developing Excel's original network marketing plan
in
between
By
blastoff
chili sales!"
early
—and
that's exactly
one sobering catch
with some
position
Kenny and
1989,
what happened. There was
for Steve,
He was
glee:
and package.
fail
—
"Instead,
I
how you're
he did.
recruit people
scheduled
and told me,
down
it
in
with
'Steve, you've
that this plan can't
had a penny
"Not only did
to
I
my name when
hold meetings to
just like
I
Houston where even the guy who
with
"It wasn't easy,
me
didn't
show
up!
but the simplicity of our plan worked
it's
working
three Representatives,
sentatives].
me
me
at
where no one showed up, there was one
was organizing
me
now
going to make your money!'"
"I barely
started," Steve says.
for
Kenny looked
a great job convincing
so that's
And
one he looks back on
just
anticipating a huge corporate
a kind of twinkle in his eye
done such
Steve were ready for
And from
who
for people today.
I
got
my
started getting their [Repre-
those three Representatives have
sprung every one of the Reps and
all
of the customers in
Excel today."
Today, Steve and his wife, Sarah,
Texas ranches and their
become one of
ing,
but
and
is
his
own
own two
helicopter. Steve
beautiful
Smith has
the legendary voices of network market-
marketing genius
is
not only revered in Excel
chronicled in journals like Success magazine.
53
Chapter Three
The Power
What makes
Network Marketing
of
the business approach that Steve Smith
helped perfect for Excel so powerful and popular? Excel
itself a
calls
network marketing company, because the
Independent Representatives
sonal
contacts
—
and
use and
and
sell
such
on
per-
friends of friends
and
associates
the company's communications products
services, instead
efforts,
rely heavily
network of family members,
their
friends, associates,
who
of the more traditional marketing
as advertising.
Excel can also be called a multilevel marketing business (the
term
is
often used interchangeably with net-
work marketing),
since Representatives
make money
not only by selling Excel's products and services but by
convincing others to do the same. "Upline" and "downline" business relationships
of ongoing income
sales
Rep
determine the distribution
— including commissions based on
and bonuses paid on the
is
at building a
basis of
how good
the
network of customers and customer
gatherers.
Network marketers
like to
dramatize the income-
generating power of their business approach by posing a
simple question:
Which would you
rather have
—
a mil-
lion dollars in cash right here right now, or a penny, the
value of which will double every day for a month?
Choosing the million
cost
54
dollars
up front would, of course,
you millions of dollars by the end of that month.
"The Most Impressive Thing
I've
Ever Seen"
In the abstract, that's not a hard concept to grasp.
Just
do the math! Designing
a real business plan to
unlock network marketing's true power, however, drawing tens of thousands of enthusiastic recruits, was the
tough task Kenny Troutt assigned to Steve Smith. By
all
accounts, the mission has been accomplished.
Sitting with Steve in an
empty meeting room
cent to an auditorium in which he
speech,
I
am
interesting
Kenny
is
about to make a
struck by his calm, low-key
complement
adja-
manner
— an
to the high-octane, high-energy
Troutt. Sarah Smith warns
me
later
not to be
fooled by her husband's outward appearance. Inside, she
says,
is
a fiercely competitive spirit
and
a relentless drive
to win.
Still,
the 50-year-old Smith
which
able,
is
why
an Excel meeting
his progress
gracious and approach-
is
through any lobby where
being held
is
is
painstakingly slow.
"He'd stand there and talk to the Reps for hours
didn't pull
staff
him away
member
I
keep to his schedule," an Excel
into our conversation, during
some of my background,
could learn
from me."
I
as
There
is
which
I
Steve says, "It sounds like
much from you
as you're trying to learn
dismiss the suggestion out of hand, of
course, but his expression of
ease.
we
told me.
A few minutes
relate
to
if
a great deal of experience
be mined from this
man who
for tens of thousands of
me
at
and wisdom
to
modesty quickly puts
has helped pave the
Americans
way
to take part in the
55
Chapter Three
one of our country's greatest traditions and
rebirth of
most cherished dreams
Your
It's
Own
—being ones own
boss.
Business-
the Place to Be!
Across America, millions are embracing the challenge of
starting their
own
way
There
to
do
it.
businesses
and
are looking for the best
are 22.1 million small businesses in
the United States today, and they are the engine propelling the
American economy. Small business owners
represent half the
out of every three
American workforce and
create
two
are creating
new
new jobs.
In a historical departure,
women
businesses at a faster rate than are
men.
A new word
has
even been coined in recognition of the growing number
of working mothers leaving nine-to-five jobs for the
flexibility,
panies
opportunity, and challenges of their
—they
An
call
increasing
themselves "mompreneurs"!
number of small
to exist because they are
an
issue ranking
icans, Forbes
own com-
businesses are ceasing
becoming very big
its latest list
businesses. In
of the 400 wealthiest Amer-
magazine observes that great fortunes
are
being created almost monthly in the U.S. today by
young entrepreneurs who
years ago.
class
are
43 new people
dime 10 or 15
in the Forbes
400
of 1996. That means nearly one in nine are new-
comers
56
There
didn't have a
in the last year.
Kenny Troutt
is
one of them.
"The Most Impressive Thing
Since 1990, 238
new people have made
displacing an equal
list,
part, they are
I've
Ever Seen"
it
number of others. For
onto the
the
most
founding their fortunes on clever and
inventive ideas and technologies, bearing out a forecast
made by
writer
and economist George Gilder seven years
ago that the 1990s would bring "a global economy
inated
more and more by fortunes of thought
dom-
rather than
hoards of things."
The
Forbes staff discovered this
when
it
analyzed the
fortunes of the Forbes 400: "In the not-so-distant past,
wealth was almost always based on possession of physical
assets.
Wealth was timber,
printing presses. Almost
real estate, factories
oil,
all
of today's
new
or
fortunes are
based not on hard assets but on ideas and organizing
principles."
Kenny Troutt
Yet, as
has cautioned, the odds of
achieving long-lasting success in the traditional world of
small business are long: 85 percent close their doors in
the
first five
years.
Standard businesses that
start
with
less
than $10,000 in the bank are especially vulnerable.
Enter network marketing and the dramatic growth
of the self-employed owners of home-based businesses.
According to Link Resources,
a
prominent
New
York
City-based market research firm, nearly 25 million
home-based business owners
part-time.
ness
is
It is
are operating either full- or
estimated that a
started in the
new home-based
United States every
1 1
These businesses generate more than $382
busi-
seconds.
billion in
annual revenues and are responsible for creating more
57
Chapter Three
than 8,200
new
jobs and entrepreneurial positions
every day.
Many
of these enterprises follow the direct selling
or network marketing approaches. According to the
Washington, D.C.-based Direct Selling Association, since
1990 alone, annual
increased
it
sales
by
some 30 percent
direct selling
to
$18
billion
companies have
— 51
percent of
through network marketing. The number of
sales-
people in these businesses has also grown by 30 percent to
7.2 million
Why
— 58
percent of them network marketers.
such rapid growth?
An
article in Inc.
delineates the following advantages of the
magazine
network mar-
keting approach for entrepreneurs seeking their
own
business opportunities:
o
It
o
In a world of marketing noise, friends and family
eliminates the need for slick advertising.
are the only salespeople customers listen to
and
trust.
o
It
reduces the cost of acquiring customers.
o
It
reduces cash-flow
has to
sell
risks,
because merchandise
before Representatives or distributors
get paid.
o
It
enables a
company
to build a large sales force
very cheaply.
o
It
capitalizes
on the exploding supply of the
self-
employed, recently estimated by the Los Angeles
Times to account for up to 15 percent of the
American workforce.
58
"The Most Impressive Thing
Ever Seen"
I've
Budding entrepreneurs of limited means choosing
home-based opportunities over franchises and other
approaches can find the
risks
and requirements lessened
even more significantly in a network marketing business.
Entrepreneur magazine itemizes a few of the things you
wont have
to do, such as these:
o
You
don't need to purchase equipment.
o
You
don't need to maintain
and manage inven-
tory.
o
You
don't need to apply for licenses or
make
tax
deposits.
o
You
don't need to
manage
o
You
don't need to
buy expensive insurance.
o
You
don't need to hire
o
You
don't need to
o
You
don't need to deal with
o
You
don't need to apply for a
o
You
don't need to obtain capital
Even big companies
not
all
a marketing budget.
and pay a
lawyer.
manage employees.
government agencies.
bank
loan.
from
investors.
are getting into the act,
of them want to admit
it,
as Inc.
though
magazine
dis-
covered:
From
are
the top of Inch
500 companies
to the
bottom
product and service companies that have adopted
multilevel marketing to control overhead, create
means of distribution, and build
force
on
a national sales
a budget. All of these companies have
59
Chapter Three
tapped into a growing contingent of displaced workers,
professionals worried about their future,
moms
and couples
—
all
at-home
looking to get into business
for themselves.
The Virtual Simplicity ofStarting a Business
It
has never been easier to start your
own
the emergence of low-cost, simple-to-use
and information technology
tions
even easier while
at the
is
business.
And
communica-
going to make
it
same time improving your odds
of success.
Excel and companies like
sible,
user-friendly
—have
—teamed up with
acces-
communications and information
markedly
technology
persons chances for success
than ever before,
it
improved
as a business
doesn't matter
it
average
the
owner.
where you
where you come from, whether you
More
live
or
are restricted to
your
home due
to disabilities or family responsibili-
ties,
or which
language you speak
stretches across
—your
territory
America and could soon extend around
the world.
You might
lars,
call it
your virtual business. For a few dol-
you can own and run your own company:
pany without
walls, a
a
com-
warehouse without inventory, a
workplace without a workforce, a back room without
billing or accounting,
thing
60
that's real is
an asset without
the profit!
capital.
The only
"The Most Impressive Thing
A senior executive
at
IBM
recently observed that
possible today to build
and run
national business from a
home
phone, a computer, a
printer,
Its a virtual
equipped with a
and a modem. The biggest
bookstore on a
that has a greater sales
it is
a profitable multi-
office
bookstore in the world, she noted,
all.
Ever Seen"
I've
not
really a store at
site
on the Internet
is
web
volume than
a Barnes
& Noble
superstore!
What empowers today's entrepreneurs and puts so
much business potential within their grasp is the speed at
which new communications technologies
able to the average person.
more complex
in
becoming simpler
what
it
to use
Technology
can do while
and cheaper
are
is
made
avail-
becoming ever
at the
same time
to buy.
Consider that the capacity of the microprocessor
doubling
at a rate
of every 15 to 18 months and will
continue to do so for the foreseeable future.
executive
I
spoke to
velopment by
is
illustrates the
recalling
that just
The IBM
impact of
this de-
10 years ago she
attempted to perform a particularly complex function
on the
largest
mainframe computer her company had
— the kind of computer
room — and "brought
to offer
entire
it
to
that used to
its
fill
an
knees"; today, she
does the same function with ease on a "think pad" at
her desk!
A
recent article in Success magazine
sums up the
marriage of network marketing entrepreneurship and
technology
this
way: "[multilevel marketing]
is
creating
61
Chapter Three
a
whole new marketplace
the
'outside
advertising, storefronts, inventory
That power
arises
of
TV
and middlemen, and
has the power to render the conventional
solete.
box
retail
world ob-
from the union of modern
—computerized record keeping and telecommunications —with
of schmoozing."
technology
the ancient art
This "union" has propelled Excel and the entire
direct selling/network marketing industry into
Around
the hottest trends in the business world today.
the world,
20 million work
in the industry,
one of
not includ-
ing China.
Richard Poe, a leading authority on network marketing,
is
make
a
so confident that direct selling
good combination
that he sees
and technology
it
bringing on a
whole new era of entrepreneurship, which he
3." In his best-selling book,
work Marketing, Poe
Wave 3: The New Era
writes:
They
use computers,
in Net-
"The most advanced
work marketing companies today
all.
"Wave
calls
stress simplicity
management
ting-edge telecommunications to
systems,
make
net-
above
and cut-
life as
easy as
possible for the average distributor."
John Fogg, editor of
Upline, pinpoints the role tech-
nology can and should play in building a network marketing business
when he
observes: "All of the tools
and
technology free you up to focus on that one most intangible part of this business,
people. Your job
them
62
is
which
to develop
is
relationships with
your people and support
in building their business."
"The Most Impressive Thing
I've
Ever Seen"
Network Marketing
Success in
Developing people and supporting them in their business
most
Steve Smith understands well this
in
essential ingredient
network marketing. "Ive seen thousands of people
new
their
said. "All
Excel businesses over the
of them have had their
Some
best achieve success.
intensive advertising effort
last
own
few
he has
years,"
ideas about
start
how
to
believe that an
immediate and
way
to start quickly.
is
the best
Others subscribe to the philosophy that touring from city to
city
is
the fastest
"And
But
way to
there's
just like in
won't
work
build a business.
nothing wrong with any of these
ideas.
any other business, the best-laid plans
unless
you
first
have a solid understanding of
the fundamentals."
In Excel, like most network marketing businesses, the
of success
essential ingredient
tion.
This
is
your
is
sales pitch, the
the business presenta-
opportunity you create,
or are given, to convince your friends, relatives, coworkers,
or total strangers to join your business.
an Excel Representative
customer gatherers.
ways to go about
And
it, all
tation," says Steve.
there's a
"No
goal of
to build an organization of
although there are a number of
of them require a business presen-
And
the plan in a clear
is
"The
while laying out the specifics of
and accurate fashion
is
essential,
more important mission.
prospect ever leaves a business presentation
remembering everything about our marketing plan,"
63
Chapter Three
Smith
how
advises.
excited
"But
if
you can make them remember
you were and how much fun you were
having, you'll be successful.
"That's
what people
are looking for
—something
to
be excited about, something that can produce a great
income and be fun
at the
same time."
Excel's Stairway of Success
With
chronically high rates of turnover
motivation
tioners,
is
is
essential in
among
its
practi-
network marketing. So
recognition. Excel has devised a system where people
"promote themselves" and
are
rewarded accordingly
every step of the way.
One
of the most
businesspeople
is
that they have
to be alone. Yet, like
businesses
from
still
common myths
about independent
gone out on
most of us, those building
their
own
their
own
seek and are motivated by recognition
their families, their peers,
and the
leaders of their
industry.
Excel offers
its
Independent Representatives
a series
of steps on a "Stairway of Success." Climbing to higher
levels brings increased financial
rewards in the form of
higher residuals and bonuses, not to mention the income
potential
from having an ever-greater network of down-
line customers.
Just as important, attaining greater heights carries
with
64
it
the respect and admiration of those
you
respect
"The Most Impressive Thing
and admire: your
friends,
upline, your downline,
ship. Perhaps
Ever Seen"
your family, members of your
and the Excel corporate
most important of
one the opportunity
affords
I've
all,
excelling in Excel
mentor
to be a
leader-
to
hundreds
of hopeful newcomers to the business and to develop
close personal relationships with other successful people.
Many
of the Excel top performers
and opportunity
role
features of their
How
new
I
among
as
talked to cited this
most rewarding
the
career.
does one earn
money and
recognition from
climbing Excel's Stairway of Success? Your fundamental
goal
is
to sign
up customers
services
and convince others
viduals
become
for Excel's
to
communications
do the same. These
part of your downline. Your
indi-
income
is
based on the following:
o
Commissions paid according
to the
volume of
product used by your customers and those in
your downline
o
An
attractive schedule
which grow
as
of leadership bonuses,
you advance
in the business, based
on the number of customer-gathering people you
successfully bring into Excel
tance customers they sign
As outlined
start.
it
dis-
up
costs next to
nothing :o
Signing up as an Independent Representative (IR)
requires only a
Most
in chapter 1,
and the long
$50
fully refundable application fee.
serious entrants in the business also purchase an
65
Chapter Three
optional
Management
provides
them with
and home
Services
all
program
for
$195, which
the initial training, information,
office systems they
viduals enrolling in this
need
program
are
to get started. Indi-
known
as
Managing
to
"promote
Representatives (MRs).
From
that point forward, the goal
is
yourself" to higher positions of sales leadership in the
company. Should you attend an Excel business presentation,
you
will
become acquainted with
requirements for each level
as well as the
the specific
compensation
schedules and bonuses each level brings. Here, in a brief
step
by
step,
is
the stairway Excel Representatives seek
to climb:
Advanced Representative (AR)
Representative
who
An
Independent
has successfully reached the
first
leadership level in Excel.
Qualified Representative (QR)
successfully qualified for
level
all
An IR who
income from
compensation plan (compensation
has
Excel's seven-
is
based on the
long-distance calling activity of ones customers and customer's customers, to a certain depth).
An IR who is developand who has successfully
Senior Representative (SR)
ing his or her leadership
built the beginning
skills
framework of an Excel
Regional Director (RD)
business.
An IR who
has attained a
high level of organizational leadership and
Responsibilities include
ous organizational events
promoting and conducting
as well as directing
nators (the role of Area Coordinators
66
visibility.
is
vari-
Area Coordi-
discussed below).
"The Most Impressive Thing
Executive Director (ED)
Executive Directors have
proven themselves to be individuals
vate,
and coordinate
is
where
Amway business,
it's
who
can lead, moti-
sales organizations.
Senior Director (SD)
level in the
Ever Seen"
I've
at in Excel.
Diamond
Like the fabled
the Senior Director position
SDs have promoted
themselves to
the highest
and most distinguished leadership position
Excel offers.
They
making
are individuals
who
have succeeded in
their Excel business a full-time occupation.
Recognizing the importance of education and the
fact that
most people
are poorly
equipped with the
train-
ing they need to be successful entrepreneurs, Excel also
offers
income opportunities
emphasize
tions
this
who
wish to
sales organiza-
and downlines.
anyone interested
tives.
those
endeavor rather than build
Area Coordinator (AC)
to
for
This position
in training
is
available
Managing Representa-
Trainers are typically people
who
have a history of
good communicators and motivators, and
success, are
have prepared themselves to understand and communicate the Excel program.
based on the
Once
qualified, they are paid
number of MRs they
train.
Regional Training Director (RTD)
director or
A
regional
non-IR Area Coordinator who has been
good standing
for at least six
months. The
RTD
in
trains
Area Coordinators and Managing Representatives.
National Training Director
successful
post.
months, an
NTDs
train
RTD
(NTD)
After nine
can be appointed to
this
Area Coordinators, hold regularly
67
Chapter Three
scheduled training schools, and perform
mary
as Excel's pri-
field training leaders.
Surrounding Yourself with Success
Recognition comes in other ways
at Excel.
Since 1994,
one of the highlights of the annual Excelebration meeting has been the
ples,
moment
at
which 25
individuals, cou-
or partners in the business are honored with the
The
Circle of Excellence Award.
recipients are selected
a vote of Excelebration attendees based
by
on "demon-
strated excellence in professional relationships, team-
work, leadership, support and concern for persons in
ones own and
others' organizations,
and
a
commitment
to the Excel opportunity."
Kenny Troutt and
Steve Smith also recognize out-
standing Excel Representatives by naming them to the
Eagle Team.
money
Members of
earners
this
team
are typically top
and have reached the Executive Director
or Senior Director level. Twenty-nine individuals, cou-
enjoy this high honor. You
ples, or partners currently
meet many of these successful entrepreneurs
11
in ensuing
chapters.
The
best of the best are
by Kenny and
Steve.
named
Presidential Directors
Together with the Eagle Team, they
comprise Excels Leadership Council. The council meets
quarterly in Dallas with
business
68
Kenny
to discuss important
developments and new directions for the
"The Most Impressive Thing
company. All of the
money
top ten
Ever Seen"
six current Presidential Directors are
earners and Senior Directors.
Randy and Melissa
Russ and
I've
Davis,
Mary Noland,
They
are
Mike and Barbara Lammons,
Paul Orberson,
Meg
Kelly-
Smith, and Al Thomas. Later, you'll learn more about
each of them.
In addition, another Excel plus
is
the enriching expe-
rience of surrounding oneself with other successful people.
Invitations to Steve
Cherry Springs Ranch
cues at
tell
Kenny and
you
that
in south-central Texas
Lisa Troutt's
youve
greatest reward
and Sarah Smith's beautiful
arrived!
and barbe-
new mansion
in Dallas
But most agree that the
comes from watching the people you per-
sonally bring into the business realize their dreams
change their
and
lives.
For most of Excels top performers, the opportunity
to
meet other successful people and help others become
successful are far
more valuable than the monthly
They have not simply become
checks.
rich through Excel, they
have been enriched.
69
Chapter Four
ANSWERING
THE QUESTION
AIDED
slides,
WHY
BY CHARTS, an overhead projector, and
Steve Schulz
moves through the explana-
tion of the Excel business opportunity with
ciency and
clarity.
Many
in the
crowd take
just listen intently. Steves explanation
Then
out
Steve puts
down
at his audience. "I
teach you why.
his pointer
notes; others
seems so simple.
and pen and looks
can teach you how, but
What you
effi-
have to do on your
I
cant
own
is
figure out the why."
After meeting and talking with dozens of Excel's
most successful Representatives,
the answers to the question
as varied
and diverse
as the
I
have discovered that
"Why do
this business?" are
people in the business.
71
Chapter Four
Some have known
little
but misfortune their whole
others were sitting at the top of highly respected,
lives;
professional careers.
money
extra
mined from
to
Some
pay off a few
the start to
wanted
just
make
bills;
to
Some
a little
others were deter-
millions.
school and college dropouts; others have
medical degrees.
make
Some
are high
MBAs
or law or
joined to climb out of poverty;
others joined because they were already
incomes but had no time to enjoy
making
six-figure
their affluence.
Some
signed up so they could do something together as a family;
others did
it
to save their families.
passionate believers in the
them
family
sham but joined
member who
to Excel
from
all
backgrounds and
circumstances, driven by different dreams
share a journey together.
With
Excel,
many have become good
family.
Having the opportunity
lives
invited
in.
They have come
now
as
power of network marketing;
others believed these businesses were a
as a favor to the friend or
Some began
friends
in
they
common
and
but
as close as
to share a part of their
with other successful people
greatest rewards that
little
—and
is
clearly
one of the
comes with climbing high
in this
business.
Seeking Another Rainbow
Excel Executive Director and corporate trainer
Torsey believes that the most
72
Bob
common denominator
Answering the Question Why
among people
joining the business
something different with
who
"People
a
do
their lives."
are totally content with their lives don't
often join Excel," he told me.
any of
"the desire to
is
number of
"We
reasons
who
attract those
want
to
for
change what
they're doing."
Its
not a question of being a
"We're also appealing to
from
all
many
failure,
Bob emphasizes.
highly successful people
kinds of highly skilled professions," he explains.
"They've found one rainbow.
Now
they're ready to seek
another."
For years Bob was chasing his elusive rainbow in the
corporate world.
A
vice president of marketing for a
company,
he
$500-million-plus
building
was working 70
80 hours a week and was well paid
for his efforts
—
to
until
materials
he became a victim of corporate
downsizing.
Despite the rug being pulled from under
traditional business environment,
to Excel with "arrogance
"But then
I
I
going to do
in
I
reports.
December 1992, and
he's either stark-raving
it.
in the
initially reacted
and skepticism," he
met Kenny Troutt
thought that
Bob
him
mad
decided I'm hitching
or he's really
my
cart
to
that horse!"
Today,
Bob maintains
than just his downline:
tives
are a
I
train to
"I
that his Excel business
consider
all
is
of the Representa-
be a part of my business, regardless
member of my downline
more
if
they
or not. Their success
what makes the Excel opportunity so
special to
me."
is
He
73
Chapter Four
credits his wife, Lois,
done
with his success.
without her love and support," he says fondly.
it
Bob
Frequently asked about his level of wealth,
this telling fashion: "I live
what
I
want
And
please.
have
"I couldn't
to drive.
I
I
where
pretty
don't have
all
I
want
replies in
to live.
I
drive
much come and go
the pressure. So
I
as
I
guess I'm
pretty wealthy!"
Bob
Recalling the daily grind of the corporate world,
sizes
up the bottom
another hour in
thank
God
my
line
by saying,
"I'd rather
have
back pocket than another buck.
I
daily for the Excel opportunity."
Others also find their goals changing
as
they climb
higher in Excel. "I'm a big believer in goals," Steve
Schulz
says.
At the
outset, the goals
he and his partner
Pat Hintze set were mostly monetary. Having succeeded
beyond
their wildest dreams, Steve tells us, "Every
Years Eve, Colleen and
I
and our three kids
sit
down
Last
New
Year's Eve,
had some very
specific
two of the couple's
goals
in
year-old said, "Every time you or
where,
we have
to
as a
What do we want to get out
coming year? What are our goals?"
family and ask ourselves,
this business in the
New
of
little girls
mind. Their four-
Mommy
go some-
go with you." The six-year-old
said,
"Disney World!"
Now
Steve and Colleen schedule presentations and
appearances around the school calendar so the family can
travel together as
much
as possible (and, yes,
one of
those trips took the Schulzes to Disney World). For
74
Answering the Question Why
answer to the question
Steve, the
why
is,
"So
we can do
this as a big-time family affair."
Doing It for
the
Freedom
Paul Orberson's goal seemed ambitious at the time. For
had taught school and coached basket-
thirteen years he
ball
and
football, earning
his efforts.
it
seemed
"I
He hoped
an annual salary of $35,000 for
he could match that in Excel, and
like a crazy idea.
went
to
an Excel business presentation in Novem-
ber of 1990 and decided to get
went
was
Within
six
months,
I
money
I
full-time," Paul says. "It wasn't really the
The
after.
the freedom.
made
in.
reason
I
but he was making
years, Paul
says.
earner and a millionaire
Yet, sitting across
clad 40-year-old,
could match what
had not only done
Today, he
many
from
Excel's top
It still isn't
What
mistake
Money
him
if
for just
me
will never
as a
make
being broke."
accounts for Paul's success?
that people like
anything
will
money
down-to-earth, denim-
easily
the money.
you happy, but neither
"It
times over.
this
you could
is
another guy next door. "Success hasn't changed
person.
I
that,
month, every month.
six figures a
good!" Paul
feels real
I
for
thought that would be great."
few
just a
was
in the first place
it
in the process,
If,
in teaching,
Within
got in
I
me and you
—
we put our minds
"I
took the attitude
average people
to
it.
You
—can do
see, we're
not
75
Chapter Four
paid for what
we
decided to pay a price and
my family and
legacy for
know
"I didn't
I
was
for generations to
it's
I
didn't have
I
any contacts.
would never have an opportunity
not just an opportunity of a lifetime,
It's
the opportunity often lifetimes!"
Given
his prior career, Paul
ask
Orberson knows the
When
of a good coach and a wise teacher.
priceless value
I
I
I
come.
anything about telecommunications.
afraid that
like this again.
start.
start this business to build a
didn't like to speak in public.
But
what we
do; we're paid for
him where he
sees the business
future, he answers bluntly, "Jim,
I
headed
in the
have no idea. But
I
have confidence in Kenny Troutt. He's the most committed person to
When
life.
nications
he says
he's
he's
company
doing that
do
in
me and
I've ever
seen in
going to build the largest
in the world, then
Kenny Troutt and
to
it.
what
I
know
my
commu-
he's
going
Steve Smith took an interest
believed in me. That's
what gave me the
confi-
dence to succeed."
He
could be the guy sitting next to you in a diner or
the fellow waiting in line in front of you at the hardware
store.
Nothing
in Paul Orberson's words, appearance, or
demeanor would
try's
most
indicate his status as one of the coun-
successful
network marketers. Except one
thing: he's a bundle of nervous energy. "I can't
even for
five
minutes," he confesses. Paul
is
sit still
earnest
and
straightforward in his approach to both conversation and
business,
76
shunning high-minded concepts and modestly
Answering the Question Why
my
him
to
draw
Paul, success seems like a simple equation
—not
fending off
repeated efforts to get
deeper significance from his achievements.
To
easy,
but simple. Kenny and Steve developed the perfect
business for average people like Paul. Paul learned from
them, placed his trust in them, and grabbed hold of the
opportunity and worked
typical
working
it
as
hard
as
man makes money
he could. Now,
this
when
not
even
he's
working, freeing himself from the time-for-money tradeoff that has snared so
may
Paul Orberson
when
many of us.
be a
man
of few modest words
talking about himself, but his inspiring
would say unlikely
—
—and some
success speaks volumes for thou-
sands of Excel Representatives
who draw hope from
his
example.
Locking the Doors
Rick Ricketts and
to the
his wife,
Past
who
Brenda, are two people
were inspired by Paul Orberson's success. Rick spent
twenty-three years in the furniture business, which he
considered a
safe, substantial
multilevel business schemes.
bet
compared
to "risky"
Then, without warning,
a
road construction project blocked off the parking lot in
front of the store. "It killed
my business,"
Rick told me.
"Brenda saw the potential of Excel before
Rick
recalls.
"All
I
I
did,"
could see was the $100 bonuses
could get for bringing people
in.
Then, on July
I
18,
77
Chapter Four
1994, Brenda and
were listening to Paul Orberson
I
speak. After Paul said 'ainV for the fourth time, Brenda
me
leaned over and poked
you can do
"You
they
see, I
had
I
thought
I
owned
I
think
'I
have a high school education.
a lot of options.
selves that if
We
we could
just
That was
close
I
didn't
got in part-time at
we promised
make $6,000
leave that behind. After just four
on
said,
three stores, but in fact
while our business limped along. But
for $5,987.
and
this business too!'
owned me.
think
in the ribs
a
first
our-
month, we'd
months, we got a check
enough, so
I
locked the doors
my business."
The
Ricketts were
year-old college kid
and were
mer
first
who
later inspired
times.
Once chained
did us the favor of a lifetime"
onward by Paul Orberson,
who
basketball coach
introduced to Excel "by a 23-
said "ain't" a
to his desk
few too
managing three
today Rick Ricketts has rediscovered family
a for-
many
stores,
and
life
never ceases to marvel that "you can even not be there
and your income
still
goes up!"
"You Wouldn't Believe
I'm
Making!"
Once Mike Lammons
just
How Much Money
starts talking
78
there's
no stopping him.
"People look at a crazy guy like
do
about Excel,
it,
so can they,"
Mike
tells
me and
me, trying
figure if
to explain
I
can
how
Answering the Question Why
he and wife Barbara climbed
the
all
way
to the
number
two position among Excels top money earners
in less
than three years.
Today,
Mike and Barbara manage
their Excel
and representative organization, estimated
at
customer
more than
35,000 Representatives and 185,000 customers, from
their
home
in Fresno, California.
Their roots are readily
apparent from Mikes Texas twang and Barbaras leftover
trace
of a Mississippi drawl.
working
I
was
at a gas station,"
in the oil business
"We met
Mike
in Texas,
recalls. "I
when
I
was
liked to say that
two quarts deep!"
Migrating to California, the Lammonses moved in
and out of various small business opportunities,
finally
building a successful health club business. Yet, the everrestless
his
Mike
—who
likes to
burn off excess energy riding
motorcycle throughout the Southwest
daily grind of the health club.
I
basically retired,"
Mike
"We
says. "I
—
tired
of the
sold our business
and
was a 50-year-old guy
with no dreams and no vision for the future."
One day
in
March 1993,
the
Lammonses did some-
thing they had never done before: they answered a want
ad in the newspaper.
The ad
invited people to an Excel
business presentation. Against
their better
it
out. "It
remembers.
what they thought was
judgment, the Lammonses decided to check
was the hokiest thing
"We were one
this big hotel
room
—and
I
ever saw,"
Mike
of just two couples there in
the other couple walked out.
had never heard of Excel and
I
I
wasn't about to fork over
79
Chapter Four
$195
to sign up.
So
I
on
left
a motorcycle trip
and
left
Barbara with the decision."
Given Mike's negativism,
on
By
his trip.
it's
a
good thing he went
the time he had reached his destination
(boat races in Phoenix), Barbara had signed
thought
was a crossroads
it
"I called
she
"He
recalls.
him
Mike
'You did
had." Today, a grateful
I
something
in this business
up. "I
for us," she says.
in Phoenix,
said,
them
I
and he knew
it,
right away,"
didn't you?'
Mike
says,
and
told
I
"Barbara saw
couldn't see at
had
first. I've
to eat a lot of crow!"
Mike's
The two
first
goal was to simply get his
will never forget the thrill
$100 check. "Kenny Troutt asked
most
exciting thing that has ever
business,
From
reply
and we told him
"I've told
I
was making a few
80
first
check."
dollars or
hundreds of
how much money
I'm
a fitting response, given the skepticism that the
find
when
they pitch Excel to prospects.
begin with the belief that there
if there
why I tell
much money I make."
it.
to us in this
in this business!'"
made, and even
at
happened
everyone the same thing from the very begin-
Lammonses
"Many
us later what's the
has developed a standard
thousands: 'You wouldn't believe
It's
first
the curious inquire about his Excel income.
ning, whether
making
back.
of their very
was that very
Mike
the beginning,
when
it
money
That's
is
no money
to be
were, they wouldn't be successful
people they wouldn't believe
how
Answering the Question Why
The Lammonses
believe that
the high
it's
rejections that pose the greatest risk to the
Representative.
and
"We come from
I'll
new
Excel
a business background,
Mike
that has helped us a great deal,"
got a very thick skin.
volume of
says.
"And
I've
pitch the business and the
products to anyone, anywhere, anytime. Cold-calling
me
doesn't bother
like
it
does so
Even though the Excel
blow of
edged sword.
down by
Mike
friends,
"I've seen
and
I've
and
turning
and two brothers
had some
it
can be more devastating
are
close friends
me down," Mike
The Lammonses
on family
people actually get turned
than being rejected by strangers.
My mother
to focus
says that can be a double-
many
their loved ones,
others."
strategy attempts to soften the
by advising Reps
rejection
members and
many
It's
still
happened
my
not
make me
to
me!
customers,
really
mad by
says.
also advise people in the business to
adopt a sensible strategy that builds on their strengths
and minimizes
owned
their weaknesses. "I have a friend
five restaurants.
He
me
told
money but he had no freedom.
anything except Excel, and so
because
all I
Barbara and
have
I
is
I
he made a
who
lot
of
wasn't working at
I
said,
freedom. We'd
make
'That's great
a great team.'
So
hold meetings and present the business
plan for people like him. That takes the pressure off those
who
don't like to speak in public or have
no time
to pre-
sent the plan." Mike's friend has since sold his restaurants
and works the business
full-time as an Executive Director.
81
Chapter Four
In most network marketing businesses,
its
the depth of
The Lammonses have
one's organization that counts.
per-
sonally sponsored just thirty- two people in the "front line"
of their business. "Twenty-one have never done anything,"
Mike
explains.
business
—but
take off based
It's
"The other
six
eleven got a few people into the
among them
really
their businesses
on the strength of those they brought
into
it.
those six Executive Directors that really helped build
and
the success Barbara
The
I
have enjoyed."
Today, the
we
recruited deep."
Lammonses work hard
but according to Barbara,
and
us going,
help
whether we recruited
lesson: "It didn't matter
wide, as long as
make
a
it's
a few
When
I
call
questions,
I
catch
"It's
the fun of Excel that keeps
dollars a
them change
the
to ask
Bermuda
shorts,"
suit,"
I
"I
tells
I
ask
Mike
I
around here
12:00
in
travel
my
my office
in a blue
to describe a typical week.
tells
on behalf of my organization about 10
14 days a month. I'm busy, but
I
at
conduct three or four meetings a week," he
me, "and
and
home
me.
for you! I'm sitting here in
reply.
some follow-up
relaxing at
a weekday. "I'm just sitting
Mike
if that is their
their lives."
Lammonses
them both
month,
noon on
"Good
at their business,
wonderful feeling to see people we
hundred
goal, or even help
I
keep
my own
to
schedule
have fun. You've got to have fun!"
try
once more to find out
paid to have
all
wouldn't believe
82
saw
just
how much Mike
that fun. His reply again
how much money
is,
"Jim,
I'm making!"
gets
you
Answering the Question Why
A
Triple Play
News
you
that your wife
is
about to have
on the family budget, not
to focus
most precious of commodities
That's
what happened
Florida, the
for
triplets
to
can force
mention that
called time
—very
fast!
to Scott Pospichal of Jupiter,
day he and wife Janet
visited her obstetrician
an ultrasound. "Great news!" their doctor told them.
"Your baby's heartbeat sounds strong and healthy." The
Pospichals joyfully embraced.
"Oops
—
what's that?" the doctor continued.
The happy
another heartbeat. Twins!"
"It's
parents-to-be
gulped once and embraced again. "Wait a second.
There's a third. Congratulations, you're going to have
triplets!"
The
Pospichals sat immobilized, half expecting
on going with more such wonderful
the doctor to keep
news. But he stopped at three, and today Scott and Janet
are the
girls
proud and happy parents of three beautiful
and a
five-year-old son, Jason.
The happy but
all
the
life-altering turn
more thankful
He was
ness as
little
about
that he
had found
as unlikely a
one could imagine.
"I
I
Excel.
candidate for the busi-
was coaching basketball
Palm Beach Community College
me. "That's what
of events made Scott
at
in Florida," Scott told
always wanted to do.
My
dream was
fulfilled."
Nonetheless, at the urging of the college president,
Scott started building an Excel business.
it
from the
start. "I
matched
my
He was good
at
coaching income after
83
Chapter Four
four months.
give
up coaching.
The
chicken pox
when
—
it
months. But
in six
was hard
to
couldn't
I
walk away from."
became convinced
to
make
a
com-
Scott contracted a serious case of
for adults,
still
a dangerous disease.
He
home, not working and not doing much of any-
at
thing.
It
Pospichals
plete break
was
tripled
I
"But the Excel checks kept rolling
was then
in. It
I
learned about the kind of security residual income can
bring." Using a favorite phrase
achievers, Scott reports
At the time he quit
his
more than $23,000
a
it
among
was then that
Excel's
"I fired
my job."
coaching job, Scott was pulling in
month.
All the Pospichals can think of as they gaze
upon
their three
baby daughters
have given them the
high
life
is
how
down
they could ever
they deserve were
it
not for the
Excel opportunity.
An Average Joe
Despite being just 33 years old and already one of Excels
top ten
money
earners, Phillip Wells describes himself as
an average guy.
"I
Rock and worked
grew up two hours south of
in a gas station to put myself through
college," Phillip told
me. After school, he meandered to
Southern Arkansas, putting in a
stint as
manager with Wal-Mart and working
jobs. After
Phillip
opening
moved
his
own
to Tulsa,
Excel. "Excel caught
84
Little
my
an assistant
in various sales
business in Wichita, Kansas,
where he was introduced to
eye,
and within
five
months
I
Answering the Question Why
my
had shut
five-year-old business
and was working
Excel full-time."
It
"The
wasn't easy.
Phillip recalls.
tion for
started
first six
months were very tough,"
"But Paul Orberson was a great inspira-
me and
still is!
making $10,000
Pretty soon, things picked up.
a
month
in Excel,
but then
I
I
hit
a plateau."
Most
successful Excel people aren't content living
on the plateaus
life
climb. Phillip
really
helped
is
—
they're looking for
no exception. "We made
my
business take
off. I
new
peaks to
a video
think
it's
and
it
because
people could relate to someone like me. I'm just an average Joe."
Within
a year of
making the video and two and
half years in Excel, Phillip had reached the
position of Excel top
get the sense that
it's
money
number
earners. Talking to
a
six
him,
I
just another plateau. Phillip Wells
won't be there very long!
Equal Opportunity
Chuck and Sandra Hoover of Houston,
looking to
set the
Excel business.
Americans
world on
fire
when
They were simply
who wanted
a fair
vide for their family and build
Creating one of the
first
Texas, weren't
they started their
average,
working
chance to adequately pro-
some
financial security.
organizations in Excel, the
Hoovers have been working the business for eight years
and
are
among
the company's top ten
money
earners.
85
Chapter Four
Talking to them, one can sense their quiet pride in such
an achievement.
The couple married
right out of high school.
were childhood sweethearts," Chuck
thirty years of marriage, we're
Hard work came
still
and
in auto sales.
a strong moral obligation to put food
four children.
What
really
made
after
going strong."
easy to the Hoovers
financial services business
"And
says.
"We
on
—
both the
in
"We
always
felt
the table for our
Excel different was that
it
allowed us to build a business that was totally our own. But
even more important, Excel offers more of a
field
than any business
lawyers give
up
I've ever seen. I've
their practices for this
level
playing
seen doctors and
company. Everyone
has the same opportunity to succeed regardless of back-
ground or
level
of education."
It's
American dream and sense of
that reassurance that the
fair
play are
still
well that seems to satisfy
Chuck
allowed us to go through
with dignity," he
Sandy's focus
to others.
Excel,
we
is
also
"Everyone
life
alive
and
the most. "Excel has
says.
on the dignity she can help bring
else's
goals have
become
ours. In
get the chance to help others realize their
dreams too,
as
we
the best rewards
are
advancing our own. That's one of
you can ever have
in life."
Model ofSuccess
When
Larry Bowditch was growing up in Kingsport,
Tennessee, he wanted to be a research chemist.
dreams die hard, but
86
as
Boyhood
he got older, Larry realized he
Answering the Question Why
loved being around people, and while research chemistry
has done great things for humanity,
would
call a
it's
not what one
"people" business.
—coming from
So the goalposts moved, and Larry
family of limited means
through
—
struggled
college. "Unfortunately,
about a year and a
half,"
a
put himself
to
my money ran
out after
Larry remembers. So he wan-
dered through various jobs, winding up as an inspector
for a glass
company
Alabama. That's where
in Huntsville,
he met and married Lucille.
As Larry continued
his search for the perfect job
struggled (unsuccessfully) to save
back to
enough money
go
to
college, the couple settled in Garland, Texas, just
outside of Dallas. In 1983, Larry landed a job with
It
and
job, but a
demanding one.
Lucille
money working
as a receptionist
while she raised
was a good
in extra
IBM.
brought
the couple's four sons.
"I
learned a lot at
IBM: marketing, customer sup-
port, training skills," Larry told
me.
"But he was never home!" Lucille chimes
"What we both
aspired to," says Larry, "was
between our work,
about going into
leave
one career
same income
social,
and
spiritual lives.
social
work. The problem
field,
go into another, and
level
in.
harmony
I
thought
is, it's
hard to
start at the
you had."
"There was definitely something wrong with
this pic-
ture," Lucille agrees.
One
day, a
son, introduced
coworker of
him
to Excel
Larry's,
and
named Kern John-
his upline sponsor,
Lee
87
Chapter Four
Lemons. "They
saw
just
me
coming.
was
I
ripe for this
business," Larry says with a laugh, referring to his job
burnout and strong desire to work with people. "The
was
simplicity
beautiful.
They
told
me
there
make money when other people made
phone
calls
—and
was
a
way
to
long-distance
the path to success was helping others
succeed."
Lucille
a vast
brought her
own
network of people
invaluable asset to the table:
to potentially bring into the
business.
She went full-time almost
idea that
I
the people
could
I
set
my own
knew," she
at once. "I liked the
schedule and talk with
recalls.
Meanwhile, downsizing was proceeding with
America and
force in corporate
all
frequent voluntary separation
especially at
full
IBM. The
began looking
offers
increasingly attractive to Larry. Lee
Lemons urged him
proceed with caution. "That
you a
tells
lot
to
about both
Lee and Excel. Sometimes these network marketing businesses overpromise.
row.
Not
buyout
however, he could
offer
Larry says,
"I
came
was
the
moon
tomor-
Larry observes.
this one,"
Finally,
They promise you
in
resist
no
longer.
November 1993, and
ready.
I
months of separation pay
was
really ready!"
to live
Another
this time,
He
got six
on while he worked
Excel with Lucille full-time. Within nine months, they
met and passed
their previous
income.
Today, the Bowditches are Excel Executive Directors
and National Training Directors. They work
a team,
88
which
is
a
wonderful
lifestyle
change
at
home
as
for Lucille.
Answering the Question Why
"All the
time Larry was in IBM,
he was doing. Now,
after
I
couldn't relate to
what
twenty-one years of marriage,
we're finally living our lives together," says Lucille.
"Our
goals are to help people change their lives
achieve their dreams," Larry observes. "It makes
when
I
see people trapped in corporate
was, or locked into
As
and
me
America,
sad
like
I
making minimum wage."
successful African-American entrepreneurs, Larry
Lucille have reflected thoughtfully
they set in their community. "If
African-Americans,
body, and that
everything's a
is:
it's
I
on the example
have one message to
the same one I'd share with every-
Keep an open mind. Don't assume
scam and
is
open
"This
is
that
a rip-off. Don't be so negative.
Other opportunities may have been closed
Excel
and
to you, but
to everyone.
the
kind of job where no resume
is
required!"
As
nity
is
we'll see in the next chapter, that
kind of opportu-
a rare find, given the tough, insecure
economic
climate of the 1990s.
89
Chapter Five
INDEPENDENCE DAY
f
1
1
%
_l_
HE Cold
War
economy
is
country,
and the experts say we
employment. With
is
over.
America
growing solidly in
interest rates
check, corporate profits are
is
all
at peace.
The
regions of the
are
at
full
low and inflation
up and the stock market
in
is
in
the stratosphere.
Are we simply riding high atop the business
soon to be headed for a
ups and downs,
fall?
this party has
Not
likely.
cycle,
Despite some
been going on for a long,
long time.
Economist and Newsweek columnist Robert
J.
Sam-
uelson explains that "by most objective standards, the
half century in our national
cessful.
life
last
has been enormously suc-
Americans have achieved unprecedented
levels
of
91
Chapter Five
material prosperity
ier,
work
at less
and personal freedom.
exhausting jobs, and
live
We
are health-
longer than any
time in our history."
Yet a quiet desperation has taken hold in the minds
and
spirits
of millions of families and communities. The
us
statistics tell
is
we should be buoyant and
that our future
overflowing with possibility. But something's wrong.
Something's missing.
Perhaps
of our
it's
the feeling that we're not really in control
that our time belongs to
lives,
working harder and longer
we're
our families
ment
—and
commit-
to that goal, our security could be pulled out
any time.
a big oil
company put
his
from
One middle manager working
at
25 years with
that
else,
to build opportunity for
that even after a lifetime of
under us
after
someone
it
this
way
after
for
being dismissed
company: "They can
neering, downsizing, restructuring, but
call it reengi-
it
still
means
you're fired."
The What, Me Worry? Economy
Despite the happy face economic
statistics,
many Ameri-
cans are worried about their income security. They're
beginning to
realize that they've
bought homes and
cars
they can't afford, delayed any serious savings plans, and
overextended themselves in both work and debt. Call
the
morning
after to the
What,
Consider these recent findings:
92
Me
it
Worry? economy.
Independence Day
o
A University of Wisconsin study cited by Business
Week found that even though
about cor-
stories
porate downsizing have faded from the front
pages in recent months, both actual layoffs and
fear
Many
of layoffs are up in 1997 over 1996.
new jobs
are created in place
of the ones that are
but just three-quarters of downsized employ-
lost,
new
ees land a
who do
find a
position within three years.
new
Those
position also find their pay
reduced by an average of 14 percent.
o
Labor Department
statistics
show
that since
1979 more than 36 million jobs were eliminated.
The New
to
o
York Times puts the figure at closer
43 million.
In one-third of all households, a family
has lost a job and nearly 40 percent
of a
relative, friend,
or neighbor
member
more know
who
has been
laid off.
o
One
in 10 adults in
their
household had precipitated a major
America say that a
lost
job in
crisis in
their lives.
o
In a role reversal from earlier times, workers with
at least
some
college education
make up
the
majority of people whose jobs were eliminated.
Better-paid workers (those
making
$50,000 per year) account
for twice the share
at least
of lost jobs than they did in the 1980s.
o
Just a
few examples of casualty counts of the
1990s: 123,000 lost jobs at
AT&T;
18,800
lost
93
Chapter Five
jobs at Delta Airlines; 16,800 lost jobs at East-
man Kodak,
o
In the
when
last
12 months alone
—during
a time
corporate profits and stock prices have
skyrocketed
Aetna
—
Best Products cut 10,000 jobs,
Sunbeam
Life cut 8,200,
cut 6,000,
Wells Fargo Bank lost 3,800, and Apple
Computer squeezed out 4,100.
The
fear
is
spreading, and
it's
many
When USA
away
eating
Americans' optimism and sense of dignity.
at
Today asked baby boomers between the ages of 32 and
50 to write to the newspaper about the security of
their
white-collar professional jobs, the responses included
poignant and often bitter
tales
ken marriages, and even
of
lost self-respect, bro-
suicide.
One
reader sadly
chronicled the decline of his once-neighborly suburban
community:
A bunker mentality has replaced neighborhood fellowship. A nomadic existence has usurped the concept of roots
The
—of
security that
living in
one place
comes from
boomers want most. And
it is
for a lifetime.
stability
is
what baby
the very thing that
today seems so hard to possess.
If jobs are
they also pay
more
less.
likely to disappear
Over the
last
than ever before,
15 years, average weekly
earnings dropped 17 percent in construction, 16 percent
in transportation,
94
7 percent in manufacturing, and 22
Independence Day
percent in
retail jobs. Overall, real
wages have declined
12 percent while worker productivity has increased
24 percent.
Shrunken expectations have poisoned the culture of
many workplaces.
Seventy-five percent say companies are
employees than they were 10 years ago.
less loyal to
And
70 percent say most working people compete more with
their
coworkers than they cooperate.
Its
income
not surprising that
when
it
comes
many Americans on Main
security,
to
work and
Street are not
sharing in the euphoria in evidence on Wall Street.
There's a disconnection that
prehend.
We
live in a
many
are struggling to
com-
time of booming business but
diminishing dreams.
That explains why the
New
York Times found in a
recent survey that two-thirds of American families were
scaling back their spending
economic
severe cuts
much
security.
on
all
for
to concerns
about their
One-fifth said they had imposed
their budgets.
More have expected
to be
better off now than they actually are.
More than
here.
due
just
Samuelson
imaginary insecurities are
at stake
believes that, ironically, decades of over-
economic progress have fueled unreasonable demands
public
proliferate
post-World
War
II
spending.
He
describes
period as an "Age of Entitlement"
the
—
heady, optimistic era in which both genuine economic
growth and an overpromising government inflated our
expectations and instilled within
ing dependence
on public
many of us
a debilitat-
largesse.
95
Chapter Five
"In 1929, government spending accounted for about
1 1
percent of the nations economic output," Samuelson
tells us.
"Three percent for the federal government, the
and
rest for states, counties,
share
it
had
risen to
municipalities.
By 1990,
this
about 38 percent, nearly two-thirds of
federal."
Not
surprisingly, the engines propelling this great
American entitlement machine
of
gas.
are quickly
running out
Beginning in the 1970s, the federal government
began to run up huge
deficit situation in the
debt stood at $5.1
that swallowed
year— $241
deficits.
mid-1990s, by 1996
trillion,
up
1
Despite an improving
total federal
requiring an interest
5 percent
payment
of the federal budget that
billion!
The impending retrenchment (some would even
predict collapse) of government's entitlement
from student loans to health care
machine
to retirement checks
has darkened our outlook, while soaring prices have
placed
many of the
of reach for
many
essentials
families.
of the American dream out
For every American
losing his or her job, there are probably
wonder why
it
now
takes
two incomes
who
fears
many more who
to secure the
same
quality of life formerly provided by one.
o
Nearly 60 percent of women
of the
now work outside
home. About 70 percent of women with
children under
1
from 45 percent
o
96
The
average
new
8 years of age are working,
just
20 years
ago.
car costs $20,000.
up
Independence Day
Home
o
prices have soared
over the
o
By one
salary
decade.
last
estimate, in 10 years we'll have to earn a
80 percent higher than
keep pace with higher
o
It's
going to cost
born
o
more than 70 percent
this year
costs.
at least
when he
People
who
haven't saved
live
to
put a child
at a public uni-
or she reaches college age.
business or investment
pared to
$123,000
through four years
versity
today just to
it is
and have no stream of
income should be pre-
on the current maximum monthly
Social Security
payment of just $1,248
a
month.
Taking Control Again
Freedom.
It's
arguably the most beautiful word in the
English language
—
or any language.
things to different people
tion that
tiny
is
comes from being
universal.
A common
reflections of the
that
the
and
most
business
demands, and
set
It
means
different
cultures, but the exhilara-
in control
of one's
own
thread running through the
successful people in Excel
them
insecurities
des-
free
from the
was
strings,
of today's economy.
In the darkest days of the Great Depression, as the
storm clouds of an impending global war were gathering
on the horizon, President Franklin Delano Roosevelt
spoke often and eloquently about not only the freedom
from want but
also the
freedom from
fear.
97
Chapter Five
The
distinction
is
critical
many
in
the
dilemma
for
and illuminates the
Our
1990s.
—
achieved freedom from want
society has
indeed, most of us enjoy
a level of material prosperity other societies
never thought possible. But
that our prosperity
is
we
live
and
eras
with the growing fear
illusory. Prosperity
demands more
of our time to be maintained, and neither increasing our
level
of education nor working longer or harder
any guarantee that
wont
it
offers
disappear virtually overnight.
Suppose you were offered a path out of this "splendid
wilderness"?
What
if
could promote yourself?
who
where you
there was a business
A
business where the only boss
could lay you off was you? Suppose there was a
business where the
yourself look
good
way
ahead was not to make
to get
at others'
expense but to help others
perform well and succeed?
Many believe
they have found such a business.
Flying High Again
Jordan Adler, an Eagle
Team member from Tempe,
zona, surveyed the constant ups and
downs of the
Ari-
airline
industry and decided to hedge his bets. As a corporate
trainer for
America West
Airlines,
he watched the regional
boom years quickly go bust during the Persian
Gulf War and the economic slowdown that followed.
carriers
"America West was laying people
me.
"I wasn't
thought,
98
downsized, but
why
I
off,"
thought
not give Excel a
try?
I
Jordan told
might
Maybe
be.
earn
So
I
some
Independence Day
extra dollars,
do
pay off some debts, and have something to
just in case."
Jordan
set
modest goals
building his Excel
at first,
business during lunch hours
and evenings.
had
"I really
no idea what would happen. After three and a half years,
I
found myself among
The
Excel's top
in dollars
and
my corporate job. No
one
greatest reward can't be
when
decided
cents. "I
to leave
100 money earners."
measured
"My
decided for me," Jordan says with great satisfaction.
dream always was
have that
The
now
—
to have a
home
in the
mountains.
I
in the national forest in Pine, Arizona."
daily grind of his past profession
is
a distant
memory. Jordan now estimates he works about 20 hours
a week.
"Someone asked me
told me. "I couldn't
Jordan Adler,
do
now
it.
he
to describe a typical day,"
Every day
earning more
is
different."
money than he
ever
imagined and enjoying the recognition that comes from
his peers
and Excel
leaders, relaxes in his
the forests of Arizona
dream home
and contemplates what he
paradox of Excel. "What brings people into
ness
—
allow
a personal desire to
them
improve one's
life
calls
in
the
this busi-
—
will
not
to be successful. In order to be successful,
one must focus on the goals and successes of others
in
order to achieve personal success."
Escaping the Poverty of Time
Focusing on others and helping them through troubling
times was nothing
new
to Excel Executive Directors
Rick
99
Chapter Five
and Cindy Brake, of
Rick was a
Louisville, Kentucky.
mental health therapist in private practice and Cindy was
a nurse.
"We
got into Excel
ago to make some
five years
ual income,"
Rick remembers. "Within two
making more
in a
month from
Excel than
in the medical profession. Excel gave
been looking for
all
my life:
me
I
was
all
year
years,
made
I
resid-
the freedom I've
the freedom to try
new things,
the freedom of time, and freedom from financial worry."
It's
been a team
effort all the way.
together," says Cindy.
"We work
"We
as partners,
and adjusting along the way. Excel has
enhanced our
built
it
growing
definitely
relationship."
Most important of all, Rick emphasizes, "Excel has
given us hope
—and we,
hope. By changing our
in turn, are able to give others
own
lives,
we're able to help
others change their lives for the better."
No Experience Required
The
leaders of Excel bring
professions to their
coaches,
doctors,
new
real
many
skills
business.
estate
from
their
former
They were
teachers,
small
business
agents,
owners, corporate executives, and homemakers. In the
eyes of Senior Directors
and Eagle Team members Kenny
and Linda Gilmore, of Brandon,
Mississippi, these skills
can be helpful, but only one qualification
required: you've got to love people
people business.
100
is
really
and understand the
Independence Day
spent 18 years in real estate and another 12 years
"I
Kenny
in insurance,"
"Then
told me.
about Excel and the plan Kenny Troutt had
you have
do
make
serious
me
a friend told
money
set up. All
in Excel
is
to
show people the opportunity and teach them how
to
to
to
teach others to do the same. Four
and
more
we went
started,
I
full-time,
and
business
you'll
is
make
the
hop on the freedom
Her
chair closer to me.
in a small
town
traffic lights,"
my
in
eyes are alive
train. That's
and on
she said. "I was a single
family,
and
I
didn't
do very
and then
day, her son called her
MR/AC
and
tired
position that
I
I
trying to
I
sold
fire
couldn't cover. But
I
a
new
wrote a check
of being broke, and by then
make some
I
I
was
had a baby
told myself, I've
changes!"
Today, Beth Hinson
earners,
well.
of two
all
mom
grew
"I
fire.
and told her about
one-and-a-half years old to support.
got to
I
trailer lots."
business opportunity. "I was so excited,
for the
what
Hinson draws her
South Carolina that had
extinguishers door-to-door
One
like people,
Freedom Train
do!" Excel Executive Director Beth
support
you
it!"
help people
sick
given us a lot
to understand about this
that its a people business. If
Hopping on
up
it's
Linda
after
quality family time.
"The most important thing
"I
months
is
one of
Excel's top 13
money
and she doesn't mind anyone knowing where she
101
Chapter Five
came from or about
quit right
of my
rest
I
now and
live off
on
want something
income
the residual
she says. "I'm finally
life,"
won't. We're
the counts against her. "I could
all
free.
But
cant and
I
a mission to help people like
to
change their
lives.
We
for the
me who
haven't even
scratched the surface!"
Moving Ahead of the Curve
Pat Hintze looked at the course of his father's
decided
it
life
and
wasn't very good. "I was a sales representative
for a paper
company, slowly climbing
"My dad
ranks," he told me.
company, and
my way
did the same thing in his
watched him get downsized
I
years of hard work, with
up the
no pension plan
after
22
to speak of.
That scared me."
So with
his wife,
Cindy, along with boyhood friend
and partner Steve Schulz and
his wife, Colleen, Pat
began to look for that special business that would give
him
financial
freedom and the time he wanted to spend
When
with his family.
that he
had
times in his
his
finally
the
life,
Pat heard about Excel, he
found
first
it.
As he had so many other
thing he wanted to do was share
excitement with Steve.
"Pat called
recalls.
"He
me
said,
at
10:30 on a Sunday night," Steve
'What
are
you and Colleen doing
now?' Both of us were teaching school
our days started
early. I said,
at the
sleep!'
right
time and
'What do you think
doing? We're getting ready to go to
102
knew
we're
Pat was
Independence Day
persistent.
show me
He
told
me
he just had to come over and
this business."
Pat Hintze did just that, and Steve
knew
right
away
they had found a winner.
"Our
original goal
was to make $203 per month,
because that was our car payment.
get a free car out of this thing.
I
I
thought we might
never for a
moment
thought Excel would become our principal source of
income," Steve
says.
Today, Pat and Steve, with Cindy and Colleen at
their sides, are partners in the Excel business, ranking
among
the company's top earners
teachers
and most sought-after
and motivators. The partners have thought long
and hard about what makes Excel so
they're so confident
remember when
this
successful
and why
about the future. Says Steve,
"We
company was nothing more than
four employees working in 900 square
Troutt and Steve Smith have really
made
feet.
it
Kenny
They
grow.
always seem to be six months ahead of the curve."
Says Pat, "Its the simplicity and the customer loyalty.
I
know my
mom will always be my customer. No
what the new products
are,
I'll
take her
and
all
matter
my
other
personal customers out of the market!"
A Six-Figure
Making
Guy
six figures a year
Jennings.
What
was
really
no big
deal to
David
drove him to Excel was the raw deal he
thought he was getting from the corporate world.
103
Chapter Five
worked
"I
as a vice president for
16 years," Dave told me.
every time the
oil
structure changed.
and
at
was
"I
an
wanted
out.
company
I
for
but
a six-figure guy,
my
commission
looked
at franchises
business changed,
I
oil
one point almost bought a dry cleaning business.
When
I
got into Excel 33 months ago,
Most important,
I
didn't
my
want
back to work. Instead, Karen
went
all
out.
wife to have to go
now
is
I
very active in the
business with me. I've never been in a network market-
ing
company
because
I'll
prior to this
—and
I'll
never be in another,
never leave Excel."
David Jennings decision
Excel mirrors
Kenny
to leave the oil business for
Troutt's decision to
do the same
a
decade ago. David's success in both endeavors underscores the reality that there
smart people to make
is
no shortage of ways
money
in today's
for
economy. In
increasing numbers, however, those even at the highest
levels
of income and
skill are
demanding more than
just
short-term monetary compensation. Like David, they are
looking for an endeavor where there are no limits to
much
they can make, where they can set their
schedule and better balance
priorities,
such
as family,
secure stream of
work
obligations with other
and where they can
income into the
continue to get paid even
when
how
own
establish a
future, so that they
they're
not working.
Excel epitomizes an important development in net-
work marketing:
a greater focus
on
services rather than
products. This, in turn, has attracted top professionals
104
Kenny Troutt,
3 years old, with brother
Terry,
Kenny Troutt
1
year old.
(#1), 10 years old.
Kenny Troutt,
1
5 years old.
Kenny Troutt,
1
8 years old.
Kenny Troutt, Lisa
Troutt, Sarah
Smith,
and Steve Smith
at
the Bootscootin'
Barbecue on the
grounds of corporate
headquarters during
Excelebration 1993.
Kenny Troutt and
Steve Smith
corporate
Presidential Director
receives the Circle
Al
on the
jet.
Thomas
of Excellence
Award from Kenny Troutt
at
Excelebration 1994.
Photo courtesy of And) De Stena
Presidential Directors Barbara
and Michael Lammons
with Kenny Troutt
at
Excelebration 1995.
Photo courtesy of Andy
De
Stena
Presidential Directors
Russ and
Mary
Noland and Meg
Kelly-Smith lead
the Presidential
Directors into
Excelebration 1995.
Photo courtesy of Andy
De
Stena
Kenny Troutt and
Steve Smith present
the Circle of
Excellence
Award
to Executive
Director Pat Hintze
at
Excelebration
1995.
I'hoio
(
ourtesy of
Andy
I
)e
Stena
Jack McLaine, Lisa
Troutt,
Kenny Troutt,
Catherine Kinney, and
NYSE
President William
Johnston overlooking the
floor
of the
moment
registers
May
NYSE
the
ECI
the
ticker
on the board on
10, 1996.
Catherine Kinney presents
Kenny Troutt and Jack
McLaine with Excels
certificate
NYSE
of listing on the
on May
10, 1996.
Sarah Smith,
Steve Smith,
Kenny Troutt,
and Lisa Troutt
at
Excelebration
1996.
Photo courtes\
oi Sal
Sessa
Presidential Director
Paul Orberson at
Excelebration 1996.
Presidential Directors Melissa
Randy Davis
at
and
Excelebration 1996.
Photo courtesy of Andy
One
De
Stena
of Excels original
handwritten downline
reports.
Lisa Troutt
at
Kenny Troutt
Award
in the
receives the Ernst
& Young Entrepreneur of the Year
(left
Lisa Troutt, Sarah Smith, Susan Casner,
McLaine. Standing
Martignon,
Excelebration 1996.
Emerging Company Category. Seated
Tammy Jacobs,
Dan
(left
and Sarah Smith
to right): Pete
to right):
and Tammy
Wittmann, Kenny Troutt, Linda
Martignon, Steve Smith,
Bill
Casner, and Jack McLaine.
Excel headquarters in Dallas, Texas.
Independence Day
from many
fields
who
have never before been considered
network marketing.
likely candidates for
Getting Paidfor a Lifetime
"I
spent 17 years in corporate America," says John Jones.
"I
was a senior account manager
My wife,
both
Patrice,
felt like
something
I
my
could do on
out
at
I
work.
I
was
it
One
duced him
the blue, an old college friend
highly skeptical.
ting in.
Thanks
ness, Patrice
We
really
to her
to get out."
whom
as
and
I
checked up on
it
was able to determine that the
months
John
introI
was
were
before get-
background in the telephone busi-
market was wide open for
Just 17
became
hungry
"Patrice
says,
I
him up and
to a business called Excel. "As
something new," John
for
day,
was time
hadn't spoken to in 10 years looked
We
looking for was
really
own.
knew
DataCom.
phone company.
for a local
What
prisoners.
totally stressed
Out of
worked
for General
later,
New
York
us."
John quit
his job
and went into
the business full-time; Patrice quit her job and joined
him
just three
Johns
months
stress attack,
after that.
the Joneses have reached the pivotal
position of Senior Director.
friend after friend
join
them
John
Today, four years after
from
Now
they are watching
their discarded corporate lives
in the business.
offers this insight:
succeed in this business
—
"You need certain
a vision of
qualities to
where you want to
105
Chapter Five
and patience, so you can get paid
go, hustle, faith,
for
a lifetime!"
Sometimes a Million
Russ and
Isn't
Enough
Mary Noland were doing
very well before they
had ever heard of Excel. "We were both
we were
ton and
no
week
to
Hous-
closing over a million dollars in sales
monthly," Russ told me. "But
days a
realtors in
do
it.
We had
we were working
a great lifestyle, but
seven
we had
life."
Mary
had
"We were very successful, but we
burnout." The Nolands were ripe for a
readily agrees.
real estate
"By the nature of our profession, we
friendly takeover.
were meeting and networking with a
we were
lot
of people, so
always being dragged to different multilevel
marketing meetings and presentations."
So what prompted the couple to trade in a profession
in
which they were
uct a
month
tough in
its
selling
for a business that
formative days?
nearly seven years ago,
for a while,"
more than $2 million
Russ
says.
both describe
"When we
very
as
got into Excel
Mary continued with
"We wanted
in prod-
to get a
real estate
life.
We
also
saw how much money was flowing into telecommunications.
That money's got
nies like
AT&T,
it
to flow
somewhere. In compa-
flows to Wall Street. In Excel,
it
flows
to Y'all Street!"
In a world eerily devoid of heroes, the Nolands,
are
106
one of the
six
who
Excel Presidential Directors, are sure
Independence Day
they have found one. "The greatest thing about Excel
the people,"
Troutt
This
One
is
Is
Mary
may sound
says. "It
Not Your Parent's Multilevel
of the most
like Excel
common
mistakes people
make when
network marketing industry and companies
is
in thinking
it's
housewives. That assessment
makers and those
who
is
and
a business for losers
not only unfair to home-
have come upon hard times,
it is
wrong. As evidenced by the examples of the Jen-
nings, the Joneses, the Nolands,
many
attracting
to the top
lifestyle it
and
of their chosen
fields
the money, and
The
I
soared
interest
to talk to
spent
one of the most suc-
of Alabama.
need
"I didn't
into
me
sum of 20 minutes
might never have come were
of a friend,
Michael seven times.
come
He
for example.
simply wasn't interested in Excel," he
for the persistence
ment
also
brought them was inadequate.
cessful practices in the state
hours and
who
is
only to find that the
years as a chiropractor, building
told me.
others, Excel
highly skilled professionals
Take Dr. Michael Thompson,
1 1
Kenny
our hero."
assessing the
also
corny, but
is
who was
"Finally, after
to persuade
I
me,"
not
down by
he had driven seven
my waiting room
about Excel,
turned
it
with no appoint-
gave
him
recalls
the grand
Michael.
Because of his persistent friend and the fact that for
all
his success
had
little
Michael realized he was not debt-free and
time for himself, he began building the
107
Chapter Five
business. "I started doing business presentations after
hours, and within six months, at age 36,
tice."
What
excites
able to change his
Michael most
own
life,
is
my
sold
I
that he
prac-
was not only
"but help others succeed too.
That's a great reward to me."
It's
a
reward that
many
others in medical services
careers are seeking as well. Their instinct to help people
already burns strongly inside them. That's
became doctors,
providers.
"A
lot
nurses,
and other medical
of people in
health care and from the
why
my group
the
stress,
and the accountant's mentality
services
are refugees
liability,
that has
they
from
the burnout,
come
to charac-
terize the practice
of medicine today. They are drawn to
Excel because
streamlined,
are
it is
it is
high-tech,
no products. And you have an even
and there
better opportu-
nity to help people."
More Money
It's
or More Time?
been seven years since Kevin and Doreen Pine, of
Hillsborough, California, were
first
drawn
to Excel.
Kevin had a successful dental practice and a teaching
position at the University of California School of
tistry.
"In dentistry, you can have
more money
Den-
or
you
can have more time. In Excel, you don't have to make
that choice.
Kevin
is
I
can't say
enough good things about
amused when newcomers
express concern, asking if
it's
too late or
saturated. "I point out that
108
AT&T
it."
to the business
if
the business
is
has about 55 to
Independence Day
60 percent of the market and we have about 3 percent.
That
doesn't
asked
when
sound
like saturation to
me! Whenever I'm
the best time to get into Excel,
is
'Right now!' I've been saying that for the
and
I've
last
say,
I
seven years,
been right every time."
Dirt under the Fingernails
Excel can bring together, under the same banner of sucskilled
cess,
medical professionals like Dr. Michael
Thompson and
Dr. Kevin Pine and hard-working non-
professionals like
mit, Missouri,
under our
R. and Betty Scott, from Lee's
J.
who
proudly proclaim, "We've got dirt
fingernails!"
"We're proof anyone can do
Scotts have been married for
was a
kids. "It
There
mometer who
worked
truck.
who
32 years and
we
The
R. told me.
two
raised
always paid our
bills.
have more degrees than a ther-
"We've done
do
that."
it all. J.
R. sold insurance,
highway engineer, and he even drove
Then we
a
this," J.
haven't been able to
recalls,
as a
managed
had
struggle, but
are people
Betty
Sum-
got a degree from
Hamburger U. and we
McDonald's. To make
to refinance
a
all
that happen,
we
our house."
Nearly four years ago, they were introduced to the
Excel opportunity. In just four months, they matched
their
monthly income. Within
six-figure per year
us
—you
could
a year, they crossed the
mark. "There's people out there
call
them hard-working,
like
blue-collar
109
Chapter Five
people
that
—who think they have no
it's
not
true. It just takes
options. We're proof
time and perseverance."
Nothing Succeeds Like Success
Lee Lemons, of Desoto, Texas,
have to hate your
"failures
There
to join this business.
life
is
no
of the company's most successful Represen-
don't
tatives
proof that you don't
only need apply" sign hanging on Excel's front
Many
door.
is
acquired
dismiss or downgrade their previously
skills;
they simply channel them towards new,
more powerful personal
goals.
Lee was a 13-year veteran of IBM, and in the course
of that experience acquired top marketing
strong self-confidence. That's
jump
why when
into Excel, he did so, both feet
skills
and
Lee was ready to
first,
in
one big
For a time, Lee's wife, Rhonda, continued to work
leap.
in accounting, duplicating a familiar pattern for two-
income
families
making
the transition to a network mar-
keting business: one spouse maintains a stable, steady
income while the other spouse builds the new business
full-time.
It
was rough going
soft-spoken man.
"It
Rep," he remembers.
at first, recalls Lee, a thoughtful,
took us 30 days to recruit our
"I finally
convinced
India to join, but he misunderstood
for $3.95 instead
this
me and
guy from
sent a check
of $395!"
Lee and Rhonda established modest goals
"My
110
initial
first
goal was simply to get
my money
at first.
back," Lee
Independence Day
"Then, we thought maybe
says.
source of supplemental income,
maybe
sand a month. Once we achieved
that,
higher yet again, hoping to
a couple thou-
we moved
make $5,000
a
As the couple moved up the income
goals took center stage.
be able to
Rhonda
me
is
come home and
says.
was
I
month."
ladder, other
my
take care of
on
vacation, we're
still
fact that
cite the goal
income
Senior Directors.
as
while
the
car, all at
And
still
exclusively
get a kick out
Excel Reps in the early stages
Lemons family
once, in a
to
making money!"
of making a car payment
target,
What
many
They
to
kids,"
"The most important thing about Excel
we're
and together
whole
was
really after
Today Lee and Rhonda work the business
of the
the bar
that we're doing things together as a family.
when
even
"What
be a good
this will
company
as their initial
actually
won
the
contest.
advice does this successful couple have for
those just starting out? "I'm a big believer in training,"
Lee
says.
to keep
We
it
"People have to be properly trained. You have
simple,
and you have
have an expression that
to
says,
work
at
it
'more meetings
sent the Excel business plan to prospects]
money,' and
and have
it's
really true.
really hard.
[to pre-
mean more
Be committed, be
persistent,
faith in yourself."
Firing Yourself
Presidential Director Al
speaking
circuit,
and
it
Thomas
is
a favorite
on the Excel
doesn't take long to understand
111
Chapter Five
why.
own
He
common
mixes
and humor (often
at his
expense) to raise people s comfort level with the busi-
ness. That's critical, for
one
is
within an organization
like Excel,
constantly surrounded by successful, highly moti-
vated people. For those
financial independence,
it
sense
trying to
still
it's
make
that leap to
an inspiring environment, but
can also be somewhat intimidating.
own humorous,
In his
at ease.
them,
"The
"is if
irreverent way, Al puts people
beautiful thing about this business," he
you have an unpleasant day or you mess
something up, you can
fire yourself.
day you rehire yourself!" To Al,
what he found
for
1
tells
And
then the next
that's the
opposite of
in real estate, the profession he
pursued
8 years in Sacramento and the Bay Area of Northern
California.
"The problem
that every time
is
you sold
a
house, you were unemployed again."
Looking
month
for the
residual
more than
kind of freedom that month-after-
income could
six years ago,
and
bring, Al joined Excel
for the last four years
he has
devoted himself full-time to the business. "This business
will
work
for
anyone
in reassuring tones.
if you'll
It's
work
the business," Al says
not a get-rich-quick scheme.
takes hard work, determination, persistence,
and
It
a burn-
ing desire."
It's
easy to understand
why a man
like
Al Thomas has
achieved a top ranking within Excel. Within
of meeting him,
friend.
112
When
I
he's talking to
you
point out that
as if
he
five
is
minutes
your close
we both had
lived in
Independence Day
Sacramento, Al quickly
might know
common.
in
Several minutes
later,
names of people we
rattles off
Sure enough, he finds a few.
he has
me
convinced that we have
already met.
ask
I
coming
tion,"
him what guidance he
into the business. "Prepare yourself for rejec-
he quickly
He
has to offer to others
adds,
this business
replies. "You'll get rejected a lot."
"My
goal
when
to bring
is
I'm mentoring people in
them out of
their shells.
Most
people fear public speaking, and they fear rejection even
we have our people wear buttons
more. Sometimes
refer-
encing Excel so that they can be approached by inter-
way around. Most
ested parties instead of the other
important,
rejected. It
if
us
I
them about
tell
still
happens to
all
the times
this day!
I
have been
My downlines
think,
those bad things can happen to Al, they can happen to
and we can
Al's
still
be successful."
network marketing strategy
is
to "go
wide
fast,"
meaning one should gather plenty of Representatives
as
quickly as possible in order to increase the odds of bring-
ing the few real stars into one's organization. "But the
fact
is,
80 percent of those you bring
much. You
20 percent
just
will
have to face that
As
many
a bachelor,
who
will
is
just a
The remaining
among
be the
do very
those you'll
real leaders."
Al enjoys the frequent travel and the
friends Excel has brought
"Money
fact.
be more active, and
hopefully find 5 percent
in won't
way
him
all
over the country.
to keep score in the business world.
113
Chapter Five
What
make
really
counts
to be able to travel to a city to
is
a presentation, arrive earlier,
friends, play golf,
and
stay in great hotels, but
invite
me
relax,"
he
meet up with some
says. "I
can afford to
more often than not
to stay with them.
It's
my
friends
a great feeling."
Freed from the often impersonal and insecure envi-
ronment of the
professional world, with
all its
accompa-
nying pressures and time demands, Al Thomas,
many
others in Excel,
365 days a
114
year.
now
celebrates
like
Independence Day
Chapter Six
REMEMBERING
WHAT'S IMPORTANT
OVERCAME CANCER TWICE.
told myself, if
I
can do
After the second time,
that,
I
can do anything.
I
It
I helped me figure out what was really important,"
says Excel Presidential Director Melissa Davis.
November
an important date in the
is
1
Randy and Melissa
one year
anniversary with
of
Davis, of Simpsonville, Kentucky.
They married on November
exactly
lives
later,
Randy
1,
1991, joined Excel
and celebrated
their
second
leaving his job as an alcohol
drug abuse counselor to devote
his full
and
time to building
the couple's business.
It
seems so neat and simple now, but
it
almost didn't
happen.
115
Chapter Six
went into Excel
"I
about
just
could be," Randy told me.
come
to a presentation
When
Then he
show
didn't
come next
time,"
Second time
—
have time." To be
"I don't
turning on
he
—
try to
show
and fourth
up. Third
up. His friend's persistence, admirable
a pain in the, uh, neck. "I started
answering machine so
I
could screen
my
says.
Randy
cially after
eventually
became more open-minded,
he and Melissa
sentation. "Randy's job
finally
espe-
went and heard the
pre-
was such that he was working
about two days a week and playing a
lot
of
golf," she
with a touch of envy. Melissa had a management
job in a hospital.
"He had
the spare time, not me."
Randy and Melissa may have had
terns,
"I'll
said.
didn't
became
my
up. Apologies flowed.
Randy
show
didn't
in retrospect,
recalls
to
he finally agreed to try to come to a meeting.
polite,
calls,"
him
a friend urged
on the Excel opportunity, Randy
invoked the timeless excuse:
time
person
as skeptical as a
but they shared a
common
different
work
pat-
love of spending
deficit spending!
"We've always been dreamers," Melissa
problem was, our dreams were always
income.
We
—
—but each
real estate business
franchises, a
six
weeks, the couple
started
sandwich shop, the
and medium term.
made
No
excuses to miss the
Excel presentation and ducked their friend's phone
116
our
required either capital or
savings to live off of for the short
For
"The
larger than
had debts. Lots of debts." They
checking out options
deal.
says.
calls,
Remembering What's Important
but during that time a powerful feeling came over them,
and
wouldn't go away.
it
"What
the chance
if this is
we've been praying for?" they wondered.
So the Davises
finally
decided to give Excel a chance,
but even on their way over to the presentation they were
still
uncertain and skeptical.
embracing small goals
a
few
that
bills,
"When we
at
"We
on the beach
Randy
just fine,"
really let ourselves go,
ing a house
could help us pay
If Excel
first.
would be
protected ourselves by
recalls.
we dreamed about
in Florida.
It
hav-
always seemed so
out of reach."
Looking back on
Randy
his skepticism,
is
not sur-
prised. "Eighty percent of first graders have high self-
esteem," he explains. "By the time those
first
graders get
to junior high, only 10 percent feel that way. In their
senior year, 99 percent of those kids feel inferior. We're
brought up in a system that
tears us
down. We're not
conditioned to believe we can be successful. We're
trained to be employees."
If
ity
Randy
one
tually
"I
can't
has reached his conclusions with a rational-
argue with, Melissa has reached them
with a sincerity no one can doubt.
know
somehow
I
the doctors
believe
unhappy and not
all
spiri-
the courage
I
would probably
my
fulfilling
illnesses
my
mustered to
disagree, but
sprung from being
dreams," she
fight cancer
says. "I
took
and applied
it
to this business.
"I live life
me. Driving
with a passion now. Excels a passion with
down
the street in
my
Mercedes with the
117
Chapter Six
down and
top
think
how
Excel.
My
Take
nity!
hard and
The
blessed
to be here
Davises
you
work
work from
is
and
hair,
I
found
to have
simple: Take this opportu-
Grab
seriously.
as fast as
times they
am
I
advice to others
it
my
wind blowing through
the
it
and run with
it
just as
can!"
the business together, and some-
beach house in Florida!
their
America's Crisis in Values
Economically,
the
country
according to the
statistics.
society
when
focus
is
on
adrift
it
may
But
be strong
who would deny
comes
to values?
a simple financial transaction:
pany your time; they
give
—
least
that our
Most
you
you money back.
at
careers
com-
give a
Increasingly,
however, Americans are finding that network marketing
opportunities like Excel help
etary needs but personal
and
Clearly, the traditional
The
signs are
o
all
around
them
address not only
societal
mon-
concerns as well.
American family
is
in trouble.
us:
Since 1970, there has been a 548 percent
increase in the
number of unmarried
couples
with children under 16 years of age.
o
In 1993, 31 percent of all babies were born to
unwed mothers.
percent,
118
and
In 1970, the ratio was 10.7
in 1950,
it
was
just 3.9 percent.
Remembering What's Important
o
There
are nearly eight million single-parent
households with children
at
Many women have entered
necessity, and many others have
tions.
These
home.
the workplace out of
pursued career aspirabut the impact on
are laudable motivations,
children of both single-parent households and those in
which both spouses work outside the home
able.
Denied the
times past,
many
and
close supervision
children are
destructive behavior.
drawn
The most
is
unmistak-
careful nurturing
of
into or are victims of
troubling trends include
drugs and alcohol, crime, and child abuse and neglect.
Drugs and Alcohol
According to
a study con-
ducted by the University of Michigan and the National
Institute
on Drug Abuse,
students and
with
illicit
mented
o
in
young
drugs that
this
adults
is
show
a level of involvement
greater than has even been docu-
any other industrialized nation
in the world.
Since 1991, the proportion of eighth graders taking any
illicit
drug
in the past 12
almost doubled, from
o
nations secondary school
1 1
months has
percent to 2 1 percent.
Since 1991, the proportion of tenth graders
taking those drugs has risen by two-thirds,
from 20 percent
o
to
33 percent.
The proportion of twelfth
illicit
graders taking any
drugs in the past 12 months has increased
from 27 percent
to
39 percent.
119
Chapter Six
o
No
substance
is
abused by youth more than alco-
hol, mirroring the nation as a whole.
Some
1
million Americans are alcoholics, with alcohol
abuse being responsible for approximately
100,000 deaths per
Crime
A
rise in
year.
youth crime, especially violent
crime, stands out as a glaring exception to an otherwise
improving public safety picture in the United
o
More than
1.5 million
States.
young people under age
18 were arrested for crimes in 1994.
o
Seventeen percent of all violent crimes are com-
mitted by young
o
men under
The number of these
crimes
the age of 18.
jumped 10 percent
in a single year.
Child Abuse and Neglect
Consider the following
statistics:
o
year for which complete figures
In 1994, the
last
are available,
more than one million children
were victims of abuse or neglect,
o
Reports of alleged mistreatment involving more
than 2.9 million children were
from 2.6 million
o
Since 1990,
as a result
120
filed,
an increase
in 1990.
more than 5,400 children have died
of abuse or neglect.
Remembering What's Important
Family science researchers are finding disturbing
between the lack of parental involvement with
links
chil-
dren and those children's proclivity to problem behavior
and learning
disorders.
"Parents are right to be concerned about the squeeze
on family time," the Washington Post concluded
in a
recent in-depth report. "Specialists say that children ben-
and
efit intellectually
together
—by
when
socially
the whole family
is
listening to adult conversation, learning to
relate to siblings
and getting
a clearer sense of the fam-
moral values."
ily's
A recent study by Search Institute, an organization specializing in research
on
to twelfth graders in
600 communities nationwide and
children,
examined 270,000
covered, according to the Post, that "children
least
four evenings a
week
at
home with
less likely to
The
dis-
spent at
their families
had frequent, in-depth conversations with
were
who
sixth
and
their parents
have sex and use alcohol or drugs."
Post report also cited another study that taped
dinner conversations between parents and children in the
Boston area for eight years and uncovered
result:
"Preschoolers
cussions
ulary
who
among
who were
exposed to mealtime
parents and siblings did better
and reading
tests in
dis-
on vocab-
elementary school than those
weren't.
"The conversations expanded
lary
this interesting
and improved
the children's vocabu-
their ability to tell a story or give an
explanation. ..."
121
Chapter Six
Many
busy parents, intuitively aware of research
findings like these, have
made
well-intentioned efforts to
reserve so-called quality time with their children.
further research
is
But
showing that the notion of parents
scheduling their children as
if
they were just another
entry on their appointment calendars doesn't
work and
misses the point.
A
recent
Newsweek cover
on the growing
story
impact of the lack of daily parental involvement in
chil-
dren's lives reported the following:
many of the most important
Experts say that
elements in children's
domestic
parents
lives
—
rituals, consistency,
know and
when
what's jettisoned
quantity time.
.
care about
.
.
regular routines
and
the sense that their
them
—
are exactly
quality time substitutes for
Parents
who
race in the door at
7:30 P.M. and head straight for the fax machine are
making
it
perfectly clear
and the kids
are
where
showing the
their loyalties
lie,
scars.
Teachers are reporting an increasing
number of disci-
which they
attribute to the
pline problems with kids,
and attention from parents.
lack of time
The dilemma and concern appear
blesome for working women.
"I
particularly trou-
think she's doing okay,"
one working mother told Newsweek about her young
daughter. "If
her.
I
wish
possible."
122
I
it
were up to me,
I'd
spend more time with
were able to stay home, but
that's just
not
Remembering What's Important
Eager to aid the family finances, pursue career aspira-
and
tions,
a family
raise
all
many women
at once,
attempt to carry a near-impossible burden. While
Newsweek found
that
men
are picking
of child-rearing and household
den
still falls
up
a greater share
responsibilities, the bur-
most heavily on women, whether or not
they are also working outside the home.
New
research cited
women
by Newsweek found that
employed outside the home devote an average of 6.6
hours to the most essential, child-care responsibilities,
such
as bathing, feeding, reading,
man devotes
For women remaining
and playing. The
age employed
just 2.5
ties.
in the
hours to those
aver-
activi-
home, the average time
doubles to more than 12 hours per week. For an unem-
ployed
tially
man
home, the amount of time
at
stays essen-
unchanged.
None of these
figures includes the
many more
hours
spent on housekeeping, shopping, laundry, cooking, and
other errands.
When
home were
the
married couples working outside
asked
how
such duties were divided
between the spouses, the response
"We
was the response of 43 percent of the
19 percent of the
To
share
it
men
50-50"
but only
women. Could someone be
fibbing?
the wives in that survey, their husbands' responses
might conjure up the famous expression of comedian
Will Rogers:
your
own
"Who
are
you going
to believe
— me or
eyes?"
Alongside
its
documentation of
Newsweeks offering of the most
a serious
common
problem,
solutions
is
123
Chapter Six
despairingly sparse.
We
are told to slow
down, seek
reduced work schedules for reduced pay, and be more
faithful to routines
important to children, such
and reading bedtime
stories.
At
as
meals
Band-Aid
best, those are
approaches.
A
Better
Approach
Today, tens of thousands of parents
—men and women
have discovered a better approach: they build their
own
low-cost Excel businesses at home, allowing one and later
two parents
to set their
own
schedules, earn serious,
long-term residual income, and put family
Its all part
and
it's
of remembering what's
first.
really
important
something that Larry Cheatham, of Bowling
He dreamed
Green, Kentucky, never forgot.
of the day
that his wife could break out of those statistics. Larry
a high school teacher
was
and coach, while Bonnie worked
as
a secretary in the school. "I began in Excel four years ago
because
lars
I
was looking
and maybe pay
for a
for a
"But with three children,
way
to
new
car,"
my
real
make
a
few extra dol-
Larry remembers.
dream was
to get
my
year,
the
wife home."
That dream was
fulfilled!
Within
a
Cheathams, now Eagle Team members, were making
more
in their Excel business than their
at the school.
but Larry
124
is
Now, not only
a full-time dad!
is
Bonnie
combined
salaries
a full-time
mom,
Remembering What's Important
Ask
does,
Steve Walker, of Spokane, Washington,
and
proudly
he'll
tell
what he
you, "I'm a stay-at-home dad!"
Steve has accomplished this because he and his wife,
Roberta, have built a successful Excel business, and one
thing above
mitted to
all
others keeps
"We
it.
them focused and
get to raise our
"This country has run
own
amok
kids,"
over the
We've got day care
centers,
Roberta
20
last
some
Steve believes. "We've got to get back to
ily values.
totally
comsays.
years,"
basic fam-
not parents, raising
our kids."
Steve reflects
on the strange experience of playing
outside in the neighborhood with his children
on week-
day afternoons and seeing no other children around.
"One
my
day,
were," Steve
care.
And
son asked
recalls. "I
me where
him
told
he looked up
at
the other kids
all
that they were
me and
said,
'I
all
in
want
day
to be
with you, Dad.'"
For stay-at-home parents Steve and Roberta Walker,
no
greater reward
possible
match
from any business or profession could
that special
moment.
The Living Proof
Loren Friedman
because
he's
lives life
lucky to be
with a passion.
alive.
to Excel.
He grew
in a working-class family, the son of a roofer.
the loving support of his family, Loren
rate attorney
it's
Loren knew the American
dream even before he was introduced
up
Maybe
and landed a good job
in
became
New
With
a corpo-
York
City.
125
Chapter Six
Then he was
struck by a devastating
intestine basically exploded," he told
thought
The
later
had four
they never
near-death experience prompted Loren to take
So did the
life.
fact that
secretary in a hotel.
want
to go
I
wanted
Loren and
"My
Vicki, were destroyed financially.
didn't
"I
large
I'd survive."
stock of
I
me.
and the surgeons told me
operations,
"My
illness.
his wife,
wife worked as a
to get her out of there, but
back to practicing law."
Introduced to Excel, Loren's skeptical lawyer's mind
threw up
kinds of roadblocks.
all
But then
all at first.
"It didn't
impress
me
at
studied what was going on in
I
telecommunications and the Information Superhighway,
and
I
about peddling some tacky
realized this wasn't
product. This was a hot industry that
part
of. I just
decided
I
wanted
I
wanted
to be a toll collector
the Information Superhighway rather than a
Loren borrowed the money to
met Kenny
my wagon
Troutt. "I
to his star,"
owe him
he
says.
to be a
toll
fly to Dallas,
on
payer."
where he
everything. I've hitched
Within
five
months, the
Friedmans' Excel business was producing more in one
month than
Vicki was making
all
year in the hotel. "So
sent her a dozen roses with a card that said
come
true."
someone
That was the
loves to talk
126
"Dreams do
day she ever worked for
else.
The Friedmans'
the
last
I
advice
about what he
$195 representing
is
to "keep
calls his
all it
it
simple." Loren
"$195 Jaguar," with
took to get into a business
Remembering What's Important
opportunity that has produced so much.
He
also has a
boat,
which he named The Living Proof. Loren Friedman
sure
is
dream
proof that you can
living
—
live
the American
twice!
Life on the
Double
John Gergen, of Eagan, Minnesota, was doing what
most Minnesotans were doing one Sunday afternoon two
and
a half years ago: he
football
on TV. Right
was watching the Vikings play
in the
wife, Alice, got another
middle of the game, Johns
phone
you hand
me
He knew
his brother-in-law
call
from her brother.
that phone, we're divorced,"
was
John told
calling to pitch
"If
her.
one of
those multilevel marketing schemes. "I wasn't interested.
I'd
seen
them
However,
all
before,"
there's
John
says.
something about caring
for
born twins that can cause you to reexamine your
fast!
"The babies came 10 weeks
with a smile. "And 10 weeks
business.
enough
time.
in
later,
we
our
real estate business. It
you're
enough time
started our Excel
We made
was
a question of
working 90 hours a week,
for the family.
We did
it
life real
John remembers
wasn't a question of money.
It
When
early,"
new-
to stay
there's
not
home."
Today, the Gergens are Senior Directors in Excel, and
their time
is
their
America today.
ing.
It's
It's
own. "This
is
the best business in
the McDonald's of network market-
unbelievable!"
127
Chapter Six
Pulling Together
It's
during times of tragedy and adversity
when
character of a business and the people in
tested.
when you
It's
really a family or just
story of Jay Smith
vided just such a
As
a
woman
it
the true
are really
company
find out whether a
another heartless corporation.
and
Meg
his wife,
is
The
Kelly-Smith, pro-
test for Excel.
executive,
Meg had
a lot to be
proud
of.
In the 1980s, she broke through barriers cleared by few
women
before her.
By 1988,
she was a senior vice presi-
dent of the twelfth largest savings and loan in America,
which had a $12
and hundreds of
billion loan portfolio
employees. She was at the zenith of a successful 22-year
career in banking.
There was
Diego
in
just
Southern California and
who owned
"My
one problem.
I
job was in San
was married
to a
a large insurance services business in
County, north of San Francisco,"
was Jay Smith.
"I
did
my
Meg
best to
told me.
guy
Marin
That guy
commute by
air
between San Francisco and San Diego, but by 1988 we
were both so busy we hardly saw each other."
Meg and Jay decided it was time
change. "We wanted something we
together, with residual income,
as equals.
we found
We were
it
major
could
build
something we could do
looking for the perfect business, and
in Excel,"
full-time right away.
128
a
for
Meg
To Meg,
says.
The Smiths went
the uniqueness of the
Remembering What's Important
company was
that "it eliminated everything having to
do with products and inventory. The
easily duplicable
The
may
but
it's
it's
so
the key."
is
when
year 1990,
business,
fact that
the Smiths started their Excel
not seem that long ago on the calendar,
away
light-years
for the
company,
for those
were
the days of infancy. "I
remember when
full-time employees, a
few desks facing each other, and
virtually
no
materials,"
Meg
there were three
reflects.
Reaching their own financial goals
ever expected, Jay Smith focused
on
faster
training
than they
and became
one of the most revered teachers and motivators
business.
Randy
The
in the
reason was simple, remembers a grateful
Davis: "Jay's philosophy was that by helping
everyone, whether in his organization or not, he
By helping
help the company.
the company, he
would
would
He would encourage everysame thing. He was a person of the
automatically help himself.
one he met
to
do the
highest character and values I've ever met."
Jay Smith was at the airport on his
meeting in 1995.
He
to a heart ailment,
devastating loss for
never
fell,
made
it.
way
to
an Excel
Jay blacked out due
and died of a head
Meg, of course, but
injury. It
was a
also for the entire
Excel family. That family has closed ranks around Meg,
helping her through with immeasurable love and support. Jay's
ment of
memory
has been honored by the establish-
the Jay Smith Excellence in Training Award,
perhaps the company's most revered honor.
129
Chapter Six
Randy and Melissa Davis were
1995.
"It's
observes.
"Not
tionship with Jay, but because
just because
me
it tells
tion Jay started, his legacy of instruction,
Hopefully
I
way he did
One
recipients, in
first
probably the most special award
Randy
received,"
the
I've ever
of
my
rela-
that the tradiis
continuing.
can make the difference in someone's
life
the
in mine."
year
Excelebration '96 in Dallas,
later, at
Meg
Kelly-Smith presented the second annual award to
Senior Director Pat Hintze, to
whom
Jay had offered
countless hours of guidance and inspiration.
emotional moment.
knew Jay
"I
for so long.
was an
It
have mixed emotions, because
He
helped us
when we were
I
strug-
gling," says Pat.
Meg
continues to bestow her love for
Jay,
by nur-
turing and growing the business they built together
and by teaching others with
and insight
skill
to
do
the same.
Never Too Busy
It
to
was an unexpected
Care
gift
of flowers that revealed the true
character of Excel to Senior Directors
Pentecost,
Mark
ball for
"Like so
from Caledonia, Michigan.
taught high school math and coached basket-
16 years, while Cindy managed the household.
many
kept saying
130
Mark and Cindy
I
others,
when
was too busy.
I
first
heard about Excel
It finally
took
my mom
I
and
Remembering What's Important
dad
to
make me
Mark
business,"
The
take a serious look at this
recalls.
Pentecosts' goals in Excel were typically
"We thought
at first:
credit cards.
month
down and
sit
But
at Excel
school,"
Mark
it
in just
pay off some
would be
useful to
one year
was making more
my
than
I
entire annual salary at the high
I
got paid the same whether
I
best teacher in the school or the worst. In Excel,
paid according to what you put into
really get
one of the only dads
12 months,
"We
we
we were
it.
It's
was the
you
get
a different
Cindy echoes Mark's enthusiasm:
to keep score."
"What you
in a
told me.
"In teaching,
way
modest
is
at
the freedom of time.
our
kids' softball
Mark was
games. Within
debt-free."
got into this business to change our
lives,
but
quickly found an even greater and more rewarding
opportunity, and that's to change other people's
too,"
Cindy
lives,
says.
The money,
to help others
the time, the independence, the freedom
—Mark and Cindy count
the blessings
they received from their Excel business over and over.
The
real test
came when tragedy struck
the Pentecost
family Their two daughters were in a serious car accident,
and one
girl
suffered critical brain injuries.
The
family kept a three-month, day-and-night vigil by her
side as she
They
began a slow recovery.
will never forget a special gesture
from Kenny
Troutt and Steve Smith shortly after the devastating
131
Chapter Six
With her
accident.
voice
Cindy
shaking,
me:
tells
"Somehow Kenny found out what had happened, found
out where we were, and sent us flowers. We just started
crying again.
ness
were
To me
that says everything about the busi-
in."
A Family Affair
Brothers
Bob and
Phil
Mims
have taken Excel's concept
of family being the most loyal customer to the next
logi-
they have become business partners too!
Bob
cal step:
and
Vancouver, Washington. Phil
his wife, Ali, live in
and Lucie
live
some 2,000 miles away
in Southlake,
most
Texas. Together, the couples run one of Excel's
vital
business partnerships, falling within the ranks of the top
ten
money
An
earners.
experienced pilot,
rate jets. "It
was a good profession, and
money. Being the
what
I
did,
Bob Mims used
I
pilot
wanted
convinced
to be the
I
me
guy
to fly corpo-
made
that
plenty of
no matter
in the cockpit.
I
couldn't see myself in the back of the plane."
When
Bob's brother, Phil, began building an Excel
business after 17 years in the wholesale jewelry business,
he was instantly drawn to the company
as the alternative
he'd been looking for. "Three years ago,
jewelry business,"
Phil
told
I
closed
me. "Bob quit
my
flying.
We're proof that a partnership approach can work well
in Excel."
132
Remembering What's Important
What
excites Phil the
most about Excel
are not the
past achievements but those yet to come. "We've
this success,
and we haven't even scratched the
There's growth,
they're
all
new
just sitting
what he
company
aires
says
all
surface.
products, the international arena
out there.
"I'm absolutely convinced that
just
had
and build the
Kenny Troutt
largest
in the world. He'll take a
will
do
communications
whole
lot
of million-
with him."
133
Chapter Seven
IT'S
IT
and Ellen Funk
Dave
TOO LATE
spent years working
around the clock building businesses. "The only
problem was," Dave
wryly,
says
"is
that as
employees we were building those businesses for some-
one
else."
One
It
day,
Dave answered an ad
was an Excel
He was
ad.
immediately excited about
the opportunity. "Right away,
our
ticket,"
Dave
to Dallas, she
thought
this
could be
thought people
in
on small farms near small towns.
like us didn't
couldn't understand
Before the couple
however.
and Dave had both grown up
conservative rural Iowa
"I
I
says.
Ellen was skeptical,
moved
for corporate trainers.
do
why Dave was
this," she said. "I
writing a check for
135
Chapter Seven
when we
training materials
card
couldn't even pay our credit
bills."
the Funks spent every minute they could work-
Still,
ing their
new
business while hanging
on
to their jobs.
Their bosses weren't very happy with the diversion of the
we were
Funks' time, attention, and energy. "Finally,
both
fired,
and you know what?
phant had been
lifted off
I
felt like a
my shoulders," Dave
giant elesays.
That was October 1992. Today, the couple
is
strad-
dling age 50 and earning a six-figure income at their
own
pace.
Dave
"We
can't afford to
likes to joke.
secure retirement.
money. We're
also
go to work anymore!"
"When we found
And I'm not just
Excel,
we found
a
talking about the
having fun and making a
lot
of
friends."
As
for Ellen, she
was more than
was
finally
convinced that Excel
just a sideline activity.
the checks, that convinced
me
"When
I
saw
that this business
is
for real."
The Funks
believe that the future of Excel rests with
Americans 40 to 60 years of age
finally starting to
like themselves,
Dave
friend back in
25
years.
on.
He sadly relates the story of a
Iowa who worked at a company for
He was
"He
says quietly.
136
is
"They should be
observes.
out of a job and
live
are
worry about retirement and being
financially secure in their later years.
worried,"
who
nearing retirement but was downsized
left
with a $200-a-month pension to
66 years old now but looks 80," Dave
Not Too Late
It's
Spending Like
There's
"I can't
No Tomorrow
think about that today.
think about that
I'll
tomorrow." For years, millions of now-middle-aged
adults belonging to the so-called
boom
baby
generation
have been taking the same approach to retirement and
savings that Scarlett
jam
Gone with
in
As
years
the
hog
a group,
—
those
O'Hara took whenever she was
the Wind.
Americans born
coming of age
"me decade" of the
in the post-war
boom
in the turbulent sixties
seventies
and
the eighties and nineties
in
in a
living high
—
are
and
on the
woefully
ill-
prepared for retirement. We're living longer than ever
before with lifestyles
more extravagant than
What's going to happen when the job
income
falters?
many
dries up, the savings are gone,
As the
first
boomers
and
ever before.
is
over,
the
one's health
cross the 50-year threshold,
are starting to ask those questions for the first
time in their
lives.
Social Security
Countdown
and Medicare:
to Insolvency
Perhaps you're one of those planning to rely upon the
nation's
two massive entitlement programs, into which
you have been paying ever-increasing amounts your
entire
working
grams
are
life.
You'd better think twice.
The
pro-
going broke, and the politicians in Washington
137
Chapter Seven
have found neither the political will nor consensus to do
anything about
Here's
it.
why and how
Started in 1935, Social Security
well for the
half century of
first
because there were
there were retirees
it's
happening.
worked reasonably
existence. That's
its
many more workers paying in than
pulling money out, not to mention
the fact that the initial retirement age of 65 actually
exceeded a male's
Over
life
expectancy
at the time.
time, the ratio of workers to retirees has shrunk
dramatically. In 1950, there were 16 workers for every
had nar-
Social Security beneficiary. In 1960, the ratio
rowed
to 5 to
year 2030,
it
1.
Today, the ratio
will be
income couple
will
in addition to their
Thanks
to
mention
to so
2 to
1. It
is
3 to
and by the
1,
two-
will be as if each
have an extra "parent" to take care
of,
own.
many boomers
in the workforce, not
a long string of payroll tax increases, for the
next 15 years or so, the Social Security trust fund
will
continue to build up a surplus. Then, from about
2012
to 2019, as
baby boomers
benefits will exceed payroll taxes
retire,
coming
income earned on the current surplus
the difference for a while.
will
start
redeeming
its
From 2019
bonds
spending for
in.
will
Interest
make up
to 2029, the
for
cash
fund
make
to
payments. By the year 2029, exactly one century
after
the stock market crash that signaled the onslaught of
the Great Depression, Social Security will
vent.
At
that time,
one
in every five
become
Americans
insol-
will be
age 65 or older. If you're around 35 years of age today,
138
Not Too Late
It's
you'll be
one of them
—and your
expectancy will be
life
pushing 80!
While the burdens on the system grow ever
the dependency
most recent
o
is
greater,
getting stronger. According to the
figures available:
For 63 percent of beneficiaries, Social Security
provides at least 50 percent of their total income.
o
For 26 percent,
provides 90 percent of total
it
income.
o
For 14 percent, Social Security
is
their only
source of income.
Seniors are worried, and so are soon-to-be seniors.
A
1995 poll conducted by the American Association of
Retired Persons
(AARP) found
that 55 percent of Ameri-
cans agreed with this statement: "In theory, Social Security
is still
afford
it
a
good
idea,
but
I
doubt
if this
country can
anymore." Baby boomers are the most skeptical;
only 16 percent expressed confidence in the viability of
the system.
Those expecting
others
to join the
who depend on
them during
happening
illness
to that
37 million seniors and
the Medicare
should also
program
to care for
reflect carefully
on what's
program.
In 1996, Medicare gobbled
up $199
billion,
about
12 percent of the total federal budget. Expenses have
exceeded receipts since 1995, and they are
as health
care costs rise
still
and the elderly
going up
live
longer.
139
Chapter Seven
The most immediate problem
is
that the trust
fund that
finances inpatient hospital care under Medicare Part
projected to spend
is
30
years, as
problem facing Medicare
structural
similar to that faced
is
nickel in the year 2001.
its last
The long-term
A
by Social
baby boomers
Security: over the next
start to retire in droves,
fewer taxpayers will be financing the benefits of more
senior citizens. In 1995, there were 3.9 workers paying
taxes to cover each
Medicare beneficiary. The Medicare
estimate that by
trustees
2030
there will
be just
2.2 workers for every beneficiary. So in addition to that
extra "parent" the
paying
for,
working couple of the future
will be
they will also be caring for an anonymous
sick relative!
Even
if politicians
and Medicare, what
retirement
mum
find the will to fix Social Security
will that fix entail?
lifestyle will it
buy
for you?
Social Security benefit
is
month. For many Americans,
What
The
current maxi-
only about $1,248 a
especially spendthrift
boomers, that will buy just a fraction of the
which
they've
kind of
lifestyle to
grown accustomed. Instead of redeeming
frequent flyer miles for
first-class air tickets
and luxury
resort vacations, legions of us will be learning to clip gro-
cery store coupons for the
This
for
fact alone
first
lives.
could significantly delay retirement
many Americans now
won't be able to
time in our
retire at
entering middle age. "They
55 or even
at 65,
because of
inadequate savings, reduced employer benefits, and the
140
It's
likely scaling
Not Too Late
back of what the federal government
v/ill
provide," the Wall Street Journal reported recently.
The
age at which you can receive
Security retirement benefits
maximum
Social
already scheduled to be
is
pushed back over time, from 65
to 67. Ever-greater por-
tions of those benefits are likely to be taxed.
And
as dis-
cussed, the benefits themselves are in question because of
the looming insolvency of the program.
Economist Paul Craig Roberts
spells
it
out bluntly in
a recent issue of Business Week:
The two government programs underwriting
an aging population
—
Security
to the
face
—
are
—Medicare and
Social
both in financial trouble. According
1995 Social Security Trustees Report,
retirees
unless there are substantial increases in the
payroll tax
—
a
and retirement
1
percent reduction in hospital
benefits
by the year 2010, a 27
percent reduction by 2020, and a 41 percent
reduction by 2040.
Finding Security with Excel
Retirement should be a time of security, with opportunities to travel,
things
spend time with grandchildren, and do the
youve always wanted
to
do
after a lifetime
of hard
work. Increasingly, both government and employers are
141
Chapter Seven
incapable of providing security or opportunities for older
Americans.
The only way
it
can be done
more from the children
take
is
form of greater
in the
and education.
payroll taxes or reductions in investments
What
to continually
parent or grandparent wants to do that?
The
leaders of Excel suggest there
is
a better way,
no matter what your age or past spending
insist its
not too
and
habits, they
late!
The Shock of Their Lives
Despite early success in Excel, Daryl and Betty Hall-
mark, of Hopkinsville, Kentucky, couldn't bring themselves to give
up
their teaching jobs to build their Excel
business full-time.
Then
how much
retirement. "We both
they checked out
they would receive in teaching
resigned the next month," says Betty.
The Hallmarks were
extra
first
by the
attracted to Excel
income they could make. "Teachers
ing for something to do to bring in
are always look-
some
extra
money,"
Betty told me. "Daryl was a high school teacher and
coach.
I
taught kindergarten and
three kids to put through college.
first
grade.
mowing
Both were intrigued by the ease and
"We thought
it
lawns."
logic of the
was kind of
neat to get paid for other people making phone
Our
original goal
was
to
make about $400
month. By the third month, we got
142
raised
During the summers,
Daryl was always painting houses and
Excel business approach.
We
a check
calls.
extra a
from Excel
It's
that
Not Too Late
was more than Daryl's paycheck from teaching and
coaching. That's
when we checked our
retirement and
checked out of our jobs."
In the business for four years, the Hallmarks have
attained the coveted Senior Director position,
addition to establishing a
more
two
retirement, they have taken
and
in
secure foundation for
trips to Australia
opened our eyes
their children. Says Betty: "Excel
with
to a
whole new world. This business helped us take off the
blinders.
I
cant believe
it
took so long!"
Controlling Your Paycheck
"I
thought
I
would
die behind a desk," says
of Eldorado,
Triplett,
LaDonna was
Illinois.
LaDonna
Like the Hallmarks,
a public school teacher, logging 16 years in
the profession and teaching everything from kinder-
garten up to junior college. "I loved teaching," she told
me. "But one day
had
I
to keep
on doing
realized
I
before
could get a pension!"
I
my
checked into
LaDonna was introduced
it
retirement plan and
for another
to Excel in
22 years
December
1992, and she reports that her experience was "charmed
from the beginning." During her
business, she
had the opportunity
first
to
month
in the
meet Paul Orber-
son.
During the second month, she hosted Steve Smith
at a
dinner in her home.
Kenny
Troutt.
To
The
next month, she met
really get her business going, she
decided to take a leave of absence from teaching.
143
Chapter Seven
No
sooner did she do that than her husband, Jamie,
with no notice
his job
lost
22 years with a coal industry
after
company.
"That experience made us
wanted
to really be in control of
be in control of our paychecks,"
LaDonna
Director
to
ever
our finances, we had to
LaDonna
says.
Today,
has grown her Excel business to the Executive
level.
Adding
sense of achievement
for the
we
realize that if
company.
do what
I
do
"It's
best,
is
and
to her personal satisfaction
that she
is
also a corporate trainer
great," she says, "because
which
is
The
to teach.
I still
get
difference
is
now I am teaching people who want to be taught."
What lessons does this successful woman entrepre-
that
neur impart to her students? "The number one factor
needed to succeed
job through,"
is
an overwhelming desire to see the
LaDonna
says. "I tell
my
students about
the countless examples of successful Excel Reps
really floundering after
two years and were perhaps ready
to quit but then in the third year
and
who were
their businesses really
took
found the
right people
off!"
She adds, "Don't worry about building a vast empire.
Worry about gathering customers.
tomers, you're
bound
to find
some
resentatives." In fact, for years
If
you
that
good
get
want
to be
cus-
Rep-
LaDonna's mother was
a
loyal customer. Just recently, at age 83, she decided to
become
"It's
stay at
144
a
Rep and build her own Excel
never too
it."
late,"
business!
LaDonna reminds
us.
"Just
Not Too Late
It's
From Fame
With
to
Fortune
a six-figure income, a popular television show,
a degree of celebrity,
Don
Dickson never figured himself
a candidate for starting over. For
ness
around the outdoor
and
30 years he
and sports
life
built a busi-
fishing,
market-
ing his ideas and love of the sport through lectures,
instructional videos,
and a TV program on
station
WGN
up
to the
in Chicago.
Call
it
an accident of timing, or chalk
it
cruel vagaries of the television business, but in the early
1990s, things began to go south. "Life works in strange
ways,"
Don
told me.
huge business
for
loss, I
"Two days
found
one simple reason:
Excel.
after
I
I
got
word of
decided to pursue
to save the business
I
built
all
a
it
my
life."
Twenty-six months
business
—he
sold
it!
A
later,
more
potential partially explains
difference in Excel for
ness, the real slick
good people
Don
stable
income with
But what
it.
Don
not only had saved his
is
really
greater
makes the
the people. "In this busi-
people don't
last
too long.
Only
the
last."
Learning from the Young
When you
family,
devote your
you expect
life
to education
to be the ones to
do
all
and
raising a
the teaching
and mentoring. But Excel Senior Directors Bob Cross,
a
145
Chapter Seven
former high school principal, and his wife, Linda, a
teacher, learned
their son.
A
one of life's most important lessons from
business major in college, Jason returned
home one day and
told his parents about an exciting
had
business opportunity he
new
just discovered: Excel.
"Jason encouraged us to listen to the Excel business
presentation.
tilevel
He had just
on
finished a unit
MLM
him
marketing]. His professors had taught
multilevel marketing
is
one of the most
[mul-
effective
that
ways to
market a product," says Linda.
"We
never marketed anything in our
me. "Here we were, living in Karnak,
total
lives,"
Illinois,
told
with a
population of 581, a town that wasn't even serviced
by Excel. Within 18 months, Linda and
I
were ready to
devote our full-time energies to the business.
to
Bob
go full-time until our checks were
monthly
We
1 1
waited
times
my
principal's check."
Linda says
flatly,
"If
Bob and
I,
sitting in
town with no business experience, can make
our small
it,
anyone
can.
Fortunate Misfortune
Ron and Judy Head thought
was pretty simple,"
says
Ron.
the die was cast.
"I
I
146
six
I
never went to college.
got a job in sales and ended up making no
$20,000 a year working
path
got out of high school,
went into the Marine Corps, and
I
"My
days a week."
more than
Not Too Late
It's
Things might have stayed the same
lost his job.
do.
I
lost
Judy had
"There
my
to
them
dignity.
But worst of
all,
go to work to help us make ends meet."
to a
ville, Illinois,
when
meeting
friends called the
at the
Heads
to
Executive Inn in Evans-
about the Excel business opportu-
to hear
"We
aren't
going to any
Ron ended up going anyway, and he was
surprised by
nity, their first reaction
stupid meeting,"
what he
nothing to
told
me Td
he was
Ron
was
clear.
told them.
learned. "There
sell,
was nothing
deliver. It
to buy, nothing to
was that simple. Kenny Troutt
never see an opportunity like this again, and
right!"
Judy,
who was
even more skeptical than
outset, speaks even
Ron
at the
more passionately than he about
what Excel has done
for
41 months we've been in
the
my
lost
I
Desperate or not,
invite
Ron
was, 50 years old with nothing to
I
pride.
forever, until
their
lives:
"For the
this business, I've
American dream," Judy
says.
that we're being paid to help
"The
last
been living
best thing of
all is
and watch thousands of
other people change their lives for the better, just as
we
have."
Always a Beginning
In his career,
Ronny
needed more than
third, a fourth,
Kirkland, of Atlanta, Georgia,
just a
and maybe
second chance.
He needed
a
a fifth chance, too!
147
Chapter Seven
had
"I've
He
he told me.
at least three 10-year careers,"
taught school, he sold mobile homes, and he took a
shot at just about every sales scheme the telecommunica-
had
tions business
to offer before finding Excel three
years ago.
"The low point of my
I
life
was
in
January 1989,
went bankrupt," Ronny remembers.
mitted to reselling phone service, but
AT&T,
in
stand why.
the better.
and
in
MCI,
became com-
"I
—
kept failing
I
in Sprint. I've finally
With
when
come
to under-
those companies, the bigger the
The problem with
that
is
there's
such a competitive business,
in
no
loyalty's
sale,
loyalty,
going to
count for everything.
"It's real
more
simple.
smaller the
the friendship matters.
more the
the
The
rate matters.
successful because
The
I
phone
larger the
finally
found
Kenny Troutt found
a
bill is,
phone
a
way
way
the
bill is,
to be
to put loy-
back into the telephone business."
alty
It
may
December
row.
be simple, but
21, 1993, and
Number 57
I
it
wasn't easy. "I started
got rejected by 56 people in a
signed up. Before
ing in $10,000 a month. But no
buy the
feeling
I
on
I
knew
it, I
was bring-
amount of money can
got from succeeding in this business!"
Living Debt-Free
Ronny Kirkland not only found
a
new
lease
on
life
for
himself through Excel but also created one for Senior
Directors
148
Hugh and
Denise
Hillis.
Not Too Late
It's
By
the time they neared age 40,
found themselves up
"We owed
to their eyeballs in
$145,000,"
sinking so fast that
Hugh and Denise
Hugh
my
consumer
painfully recalls.
father-in-law
had
debt.
"We were
to take out a
second mortgage on his house to help us pay our
You cant imagine what
With
that did to our self-esteem."
four sons to support and a 13-year career in
insurance that seemed to be going nowhere,
no way out of the
workforce
work and
cycle of
youngest son reached age
5,
debt. After their
the Christmas season in
named Ronny Kirkland
and exclaimed, "Forget Christmas, son.
lode. If we pull this
ing your
money anymore,
one
you'll
off,
Excel plan.
at
them
for,"
Hugh
this
law's
just hit the
it!"
show them
just to
the
life
preserver
"I
thrown
knew within
what we needed and were looking
years, the
how good
it felt
couple was debt-free.
the day
I
"I can't
paid off my father-in-
mortgage and handed him back the deed to
house,"
the
says.
Within two
describe
is
Hugh
you wont be count-
just as fast as they could.
90 days that
called
in a beat-up old car to
home
They swam toward
I
be weighing
Ronny then drove nine hours
the Hillises' rural Tennessee
Hugh saw
Denise went back into the
Then during
as well.
1993, an old friend
mother
bills.
Hugh
explains. "Excel allowed
get out of debt,
and
I
that chance to
never want to go there again."
That explains why, despite
Hillises live in the
me
his
their business success, the
same home and drive the same
they did before Excel. "What's really important
is
car
that
149
Chapter Seven
we've freed ourselves from the debt trap.
who come
to
homes and
cars. There's
self-respect
and your
I
our meetings not to worry so
tell
people
much about
something more important: your
self-esteem."
Says Denise, "Excel has absolutely changed our
It's
the freedom that
comes from being
My desire
and then climbing out of it.
ize this
is
lives.
so deep in debt
that others real-
freedom too."
Preparing for Poverty
Glen and Charlene Phibbs, from Tulsa, Oklahoma,
worked hard and without complaint
all
their lives. "I
spent 30 years in sales and marketing, including 10 years
in real estate,"
Glen told me. "Charlene was
nurse working 12-hour
After a lifetime of
show
for
it?
A
shifts."
toil,
"Nothing.
retirement,"
Glen
The couple
what did the Phibbs have
to
loving family, including seven children
and 15 grandchildren,
security:
a registered
to be sure.
We
But
as for financial
had put away very
little
for
says.
joined Excel over two years ago, Char-
lene says, "because this business gave us our best oppor-
tunity to catch up. If like us others have been unable to
prepare for retirement, you
still
have a chance to catch
up through Excel." Six months
after starting the busi-
ness,
even
150
Charlene was able to quit nursing and catch up
faster.
The Phibbs
are Executive Directors
and
are
It's
Not Too Late
proud
to have in their organization six of Excel's top
money
earners.
From Over
Everyone
tried to tell Barbara
Witt that she was over the
commentary on
a society that at once pur-
a sad
hill. It's
ports to
of the Mountain
the Hill to Top
honor parenthood but
at the
same time
wisdom
the culture of youth and often seeks to push the
of age
exalts
aside.
For 32 years, Barbara was a stay-at-home
mom,
rais-
ing four children and managing the family household.
But
with her children grown and her marriage
at 52,
own with no
breaking up, Barbara found herself on her
career.
Despite
all
into a job selling
the doubters, she plunged headlong
new
custom-built homes, and she soon
became the company's top
Deeply
religious,
salesperson.
Barbara turned to the Bible for
guidance during the difficult time
when
undergoing such change and uncertainty.
was time to get out of the boat and
water," she says.
first,
her
life
was
"I realized
try to
it
walk on
Resistant to network marketing at
once she found the strength to "get out of the
boat" she attacked the business with a vengeance. "I
started
two years ago when
day one
people
I
all
I
was 62 years
was signing people up
the time.
I
just signed
old,
like crazy.
up
and from
I
talk to
a 64-year-old lady
the other day.
151
Chapter Seven
"I tell
the boat
them
the
all
same
thing:
it's
time to get out of
and walk on water."
Barbara also credits the business with bringing her
family closer together than ever before. Last year, she
took 17 members of her extended family to Disney
World, putting them up
down
been
marvels.
a
No
day since
one
is
in the best hotels. "I've never
I've
been
in this business," she
Barbara Witt
telling
she's
over the
hill
any longer!
A
Enough
Little Is
One
of the
common
reservations expressed
sidering joining a network marketing
belief that the chances of
serious
money
is
the
are neg-
or building financial security for retirement years are
not that bright, so
The
reason
is
tional income, if
why
Let's
bother?
because even modest sums of addi-
handled responsibly, can with patience
and perseverance lead
life.
company
the prospects of really changing one's
ligible; therefore,
life
making
by those con-
to a
more
secure and bountiful
assume, very conservatively, that you earn
six
percent on annual deposits of the entire year's proceeds
from your Excel business. (The following
exercise
would
apply regardless of the source of income.)
If
you save
just
savings), you'd have:
152
$900
yearly ($75 average
monthly
It's
o
$5,073
o
$15,109
after
o
$20,948
after 15 years
o
$33,107
after
If you save
Not Too Late
after 5 years
10 years
20
years
$1,800 yearly ($150 average monthly sav-
ings), you'd have:
o
$10,147
after 5 years
o
$30,218
after
o
$41,897
after 15 years
o
$66,214
after
If you save
10 years
20 years
$6,000 yearly ($500 average monthly sav-
ings), you'd have:
o
$33,823
o
$100,726
after
o
$139,656
after 15 years
o
$220,714
after
If
you
save
after 5 years
10 years
20
years
$12,000 yearly ($1,000 average monthly
savings), you'd have:
o
$67,645
o
$201,452
after
10 years
o
$279,3 1 2
after
1
o
$441,427
after
20 years
after 5 years
5 years
153
Chapter Seven
Of course,
income
at a
should you save or invest your extra Excel
higher rate of return, your "paltry" monthly
sums would grow
that
much more.
For example,
8 percent interest, your $6,000 in yearly savings
provide you with a nest egg
o
$35,200
o
$107,074
o
$ 1 62,9 1 3 after
1
o
$274,572
20
If
you
at
would
of:
after 5 years
after
after
10 years
5 years
years
are able to sock
away $12,000
a year at 8 per-
cent, you'd have:
o
$70,399
o
$214,147
after
o
$325,825
after 15 years
o
$549,144
after
Want
to
after 5 years
become
10 years
20 years
a millionaire
income of just $1,200
a
on an Excel or other
month? Save
it
each
month
at
12 percent interest, and in 20 years, you will have accu-
mulated $ 1 ,037, 5 5 5
The point
is this:
Even
if you
business to the point where
it
do not work your Excel
becomes your principal
occupation and your primary source of income, the extra
income you do
still
154
earn, saved responsibly
improve your
life
in significant ways.
and
wisely,
can
It's
Not Too Late
For example, you could be 50 years old today, continue to
work
that full-time job,
and sustain your current
spend your entire
lifestyle.
salary,
Meanwhile, with the
help of your spouse and family, you could be starting an
Excel business, perhaps generate (by
way of
illustration
only) $1,000 extra dollars a
month, and socking
away
By
at 8
percent interest.
retire at 65,
hand
all
of
it
the time you're ready to
you could have more than $300,000 on
in addition to
your pension and Social Security.
What
an extra margin of comfort and security that
would
provide!
Full Circle
Sarah Smith has been as close to the center of Excel as
anyone. I'm talking not about the corporate center but
about the
vital center
change people's
of the business: the power
After
lives.
all,
she
is
it
has to
married to Steve
Smith, the chief architect of the company's network marketing approach to business.
Some
pany
skeptics believe that a
consists of a highly manipulative
ful pros at the center
dream factory
who
concoct a
group of successskillfully crafted
that grinds out a product for the masses
without believing in
It's
network marketing com-
it
akin to the image
its
power themselves.
we have of
the entertainment
or feeling
industry, of sophisticated corporate barracudas releasing
155
Chapter Seven
trashy movies, music, and television shows they
would
never listen to or watch.
Anyone who
talks to
that the belief in the
Sarah Smith quickly realizes
power of
this business to
change
people's lives begins at the top. In very emotional terms,
she underscores an important theme of this book: no
matter what twists and turns your
too late to have a
To
Sarah,
life
new
life
has taken,
not
beginning.
has been a series of detours,
and some bad. For
it's
a time, her
life
some good
was picture-postcard,
middle-class perfect. After a comfortable upbringing in
El Paso, Texas, Sarah graduated from Stephens College in
1973, began a career as a teacher, and in 1974 married
Steve. "It
was
two
and a
I
cars,
perfect," she recalls.
colonial
"We had two
home with
a white picket fence.
was a full-time homemaker, which
wanted
what
is
really
I
to do."
Then
about
children,
Steve
his falling
came home one night and
out with his
father.
He was
told Sarah
quitting the
family business. Overnight, the security of Steve's
six-fig-
ure paycheck had disappeared. "Over three years, our
homes got
I
smaller
went back
Sarah
and
smaller.
We
moved
to Austin,
and
to teaching."
recalls
in a friend's
how low
condo
the family
rent-free for 16
had sunk: "We
months.
lived
When we
ran out of money, the electricity and the water were
turned
off.
We
had no phone
either, so
I
had
to
go to
the local convenience store to call in for substitute teach-
ing jobs."
156
Not Too Late
It's
She was running out of patience, and she deeply
resented that Steve threw overboard their comfortable
dreams she
to pursue
and we almost
cally lost everything
on
Reflecting
understand.
really didn't
lost
that painful period now, Sarah realizes
put boundaries around.
way
That's the
it is
and,
He had
someone you
is
to follow his heart.
with entrepreneurs. They want to try
something new and be on
When
basi-
our marriage."
that she failed to see at first that "Steve
can't
"We
life
their
own."
Steve crossed paths with network marketing
later,
his calling.
Kenny
knew he had found
Troutt, she
"You should have seen him
of Excel," she
recalls in
wonder.
in the early days
He worked Monday
through Friday in Dallas with Kenny and commuted
back to Austin on weekends. Sometimes he'd
two hours
in
me
advance that we were going to have a bar-
home
becue in our
ness.
tell
When
he
so he could
had
back
network
problems,
for the busiI
saw him
presenting the Excel plan to prospects in a horizontal
position.
pitch
To
this day, Steve still personally
when he comes upon
that
makes the
one new potential
customer!"
Sarah was happy for her husband: "Nothing dies
slower or
wouldn't
more
painfully than your dream,
just
let his die."
"This business has given us so
we used
and Steve
to have none," she tells
their families.
many
new
choices where
Excel Reps and
"You too could be on the verge of the
greatest years of your
life.
Just listen to your heart."
157
Chapter Eight
NO MORE EXCUSES
SMITH HAS heard
STEVE
all
the excuses. So, in his
firm, fatherly manner, he looks out over the
crowd of 1,500
Los Angeles and
says,
at the Excel
"You know,
me
people quit Excel they send
I'm quitting today and
is.'
The
letter
didn't train
arrive
I
want
may complain
him
seems
letter.
to
tell
like
They
whenever
say, 'Steve,
you whose
fault
it
that the individuals sponsor
didn't
work
the
way
it
was
to.
"Believe me, I've heard
sitting there
gling to
it
in
or her properly, or the materials didn't
on time, or the plan
supposed
a
Opportunity Rally
all.
So
if
any of you
are
thinking you might quit and you're strug-
come up with
me when we
them
a reason,
adjourn, and
I'll
come down
give
you
a
here and see
new
excuse to
159
Chapter Eight
put in your
who
would be
quit
But
letter!
totally
I
done
do. I've
be convinced of this
o
wish that once someone
honest with
before and
my job
done
If I've
it
just
me and
send
I'm quitting today because
letter that says, 'Steve,
what
I
I'll
do
it
me
a
that's
again!'"
you should
in writing this book,
much by now:
Telecommunications
industries in the
is
one of the most dynamic
United States and around the
world today,
o
Network marketing
is
one of the fastest-growing
business approaches in America.
o
Excel
is
a solid
track, passing
Wall
Even
so,
company on
muster on both Main Street and
Street.
you may be thinking:
me. I'm not sure
right for
a fast but stable
I
can do
It still
it.
It
doesn't
sound
sounds too good
to be true.
You
mon. Many of
told
me
duced
and
Your questions
are not alone.
of their
own
own
when
—skepticism about
ability to
uncom-
successful Representatives
intense skepticism
to the business
their
most
Excel's
are not
succeed in
Philip Eckart, of Austin, Texas,
first
the
intro-
company
it.
was one of them.
He
got into the Excel business seven years ago. "At that time,
it
was very
eight
160
difficult to
months and
be successful in Excel.
started
I
quit after
working another network
No More Excuses
marketing business where
greener.
It
appeared the grass was
it
Two-and-a-half years
wasn't.
the Excel opportunity again
So
work
I
looked
at
and saw a company that had
evolved to where the opportunity was
able.
later, I
more
easily achiev-
got back in." Today, Philip and his wife, Heidi,
their Excel business full-time
and have reached the
coveted position of Senior Director.
Asking the Tough Questions
If
you
tally
are considering a decision that could
change your
Fd
tions.
life,
like to try to
fundamen-
you should ask the tough ques-
answer a few of them here.
Are network marketing businesses real or are they
phony pyramid schemes set up
When
began
I
my
examination of
approach to business,
ciates
to rip offpeople like
many of my own
— most of them from highly
this
me?
unorthodox
friends
and
asso-
skilled professions
were quick to condemn multilevel marketing companies
as
phony or even
illegal
pyramid schemes.
Finally,
I
chal-
I
said.
lenged the remark.
"You
"Just
just called this
what
"It's
is
that,
so-called
a pyramid,"
anyway?"
when, um,
gled and
company
stammered
well,
you
for a
minute
see
.
.
."
My
friend strug-
to try to explain
what
pyramid scheme was, but he couldn't do
a
it.
161
Chapter Eight
word of mouth had
Clearly both the news media and
poisoned his attitude against these companies, from
Am way to
Mary Kay
He had
to Excel.
heard that these
companies were pyramids and that pyramids were bad;
companies must be bad. Case closed.
therefore, the
may
Unfair as the situation
be, there
that this approach to business suffers
is
no question
from a serious
image problem in many quarters. Someday, hopefully,
the image will catch
o
It is
ple
o
to the facts,
Network marketing
across
o
up
are these:
catching on like wildfire
America and around the world.
being embraced by both companies and peo-
who
It is
is
which
have never considered
it
before.
changing the way we buy and
sell
goods and
services.
o
It is
giving hope and opportunity to millions of
people
What
who
otherwise
may
have none.
constitutes an illegal pyramid?
While the law
is
scheme
is
subject to differing interpretations, a pyramid
generally seen as a business that
sively
tle
on paying people
or no focus
to sign
New
built almost exclu-
distributors
—with
lit-
actual customers to
buy
recruits are required to
buy
on gathering
products and services.
up
is
major quantities of a product up
front,
with no opportu-
nity to return unsold inventory for a refund. Intense
pressure
162
is
applied to get
them
to
buy expensive
tapes,
No More Excuses
and
instruction manuals,
Essentially, participants feed off
reckoning in 1979,
Commission ruled
and not
marketing industry faced a day
entire multilevel
legal
too.
each other, with the
fish.
The
of
rallies.
consuming the resources and energies of the
big fish
smaller
meetings and
tickets to
that
While
Amway was
On
a pyramid.
when
all
great emphasis
the Federal Trade
a legitimate business
counts, Excel passes the test
is
placed on bringing
Representatives into the business and developing
through training to their
new
them
end con-
fullest potential, the
sumer always remains the core of the business. All one
has to do
is
in Dallas,
visit Excel's call
and customer
Houston, or Reno to understand
tant customer service
pany. After
all,
and
upward
how
impor-
satisfaction are to the
com-
with the demand for an ever-expanding
array of telecommunications services
spiral
service centers
—not
to
mention the
— ignoring
within this industry
on
a never-ending
intense competition
the customer
would be
just plain stupid.
Nevertheless, the stigma remains. Part of the reason
is
because network marketing
still
seems
untested approach. Those companies
who
like a
new and
have sunk for-
tunes into hiring sales forces, buying ads on network
television,
and developing
intricate retail distribution
networks have a vested interest in keeping the doubts
alive,
even though
many of them
are migrating
toward
direct selling approaches themselves.
163
Chapter Eight
In
Wave
The
3:
New
Era in Network Marketing
(Prima), Richard Poe draws an interesting parallel in
his discussion
of network marketing's rocky road to
legitimacy:
New ideas
its earliest
from the
are always attacked
.
.
for
.
attacked like hungry barracuda.
Exposes featured destitute families who'd
life
In
first.
and from the corporate world, and
almost identical reasons.
The media
rejected at
endured similar abuse
days, franchising
press
and
lost their
savings through franchising schemes. Attorneys
general in state after state
marketing method.
condemned
the
Some congressmen
new
actually tried
to outlaw franchising entirely.
How quickly things
change! Today, franchises
account for 35 percent of all
United
retail sales in
the
States.
Even if the industry
is
legitimatey
how do I know Excel
itself is for real?
This concern touches upon another reason for lingering
doubts about the network marketing approach to business: there are
built
some bad
apples.
there are companies
on flimsy premises with lousy products, impossible
marketing plans, and dubious
How
can you
you're considering
step checklist:
164
Out
tell
is
if
solid
ethics.
Excel or any other
and
company
substantial? Here's a five-
No More Excuses
Check with
1
in
the Direct Selling Association
Washington, D.C.,
This
trade
a
is
applying,
developing,
Ask
it
and spurs the process of
and enforcing industry "best
DSA
the
293-5760.
group that not only promotes
but polices
this industry
practices."
at (202)
(DSA)
whether the company you
Because in order to become
Why is that important?
a DSA member, the com-
pany must sign and adhere
to a strict
want
Excel
to join
is
is
member.
a
a leading
DSA member
and
code of
ethics.
a signatory to the
code of ethics.
2.
Look
Is it
sional
on
at the
company's track record.
growth path? Does
a steady
management
that
is
accessible
have profes-
it
and open
to inde-
pendent representatives, customers, and the business
press?
Does
it
present itself well and professionally in the
community, the media, the meetings, and conventions
holds through
facilities
its
it
corporate offices and other business
and through communications organs, such
as
magazines, product presentations, and videos?
Kenny Troutt took
step
a bold
by taking Excel public
and somewhat unusual
in 1996.
Beyond
the strategic
business reasons, doing so has in the eyes of
observers bestowed great credibility
Going public means
is
is
on the company.
that detailed financial information
regularly filed with the Securities
mission and
many
and Exchange Com-
therefore publicly accessible.
work companies remain
in private hands.
Most
net-
Nothing bad
should be implied in the decision of those remaining
165
Chapter Eight
private,
about
3.
but Excels decision to go public speaks volumes
this
company's openness to scrutiny.
Examine the marketing
plan.
Does the plan make sense
user-friendly?
Can you
and training you need
Make
4.
Is
Is it
simple and
anticipate receiving the support
(at a
Network marketers have
you
ness for yourself, but
to you?
reasonable cost) to succeed?
You may be
a saying:
in busi-
are not in business by yourself.
sure that will be the case in the
company you
join.
Consider the product(s).
demand
a passing
them going
for
consumer
Are they products you would
fad?
want your own family
to grow, or are they part of
to use?
One
important trend to
consider was summarized recently by University of
Illinois Professor
W. King
Charles
"Network marketing
is
in Success magazine:
going through a revolutionary
change. Companies are cutting loose from their narrow
focus on a few specialized products to compete in the
larger
world of services."
Professor
1980s most
King points out that during the 1970s and
new network marketing
firms continued to
be product-driven, selling from the traditional categories
of personal care, nutritional supplements,
and
family care,
Amway
its
had
major
and educational products.
historically offered a range
sales
volume continued
Change began
nineties.
leisure
home and
of
services,
but
to be product-based.
rapidly as the eighties turned into the
Companies such
as Excel,
MCI, and
Sprint have
defined the post-regulation telecommunications industry
166
No More Excuses
through network marketing;
other companies
as well,
have been developing such approaches for services such
travel, legal
counseling,
and insurance.
on the near horizon. "We can
Electrical service
is
anticipate that services will
widen the beachhead of network marketing companies
the years ahead, allowing
as
them
in
to gain a vastly greater
share of our economy," concludes Professor King.
When
distance
comes
it
phone
many of
service),
successful Representatives
clearly.
is
that
The
it's
mainstay product (long-
to Excel's
view
its
most
the company's
advantage simply and
ultimate advantage of selling this product
reordered every time a customer picks up
the phone!
5.
who
Talk to the people
are
working the business.
You're likely to find people just like you, people from
your station in
strengths, weaknesses, hopes,
they
made
it
work
whom
people with
life,
and
Find out
fears.
make
or failed to
it
you share
how
work and why.
Here's one Excel example:
Methodical
is
the best
journey to Excel.
It
way
to describe
Jimmy
took him 20 years of study and
scrutiny before he found a business that "met
teria."
A
former stockbroker and teacher
all
the
who
company, Jimmy told me,
financial services
Dick's
ran a
have
"I
always been fascinated by network marketing." In
his fascination led
him
to
different. It
met
all
really
fact,
examine 121 different network
marketing companies. "Some were
were scams. You
cri-
really
good.
Some
have to be careful. Excel was
the criteria for me."
167
Chapter Eight
Why
did Excel stand out? "Loyal customers
—
that's
Jimmy says. "You derive your customers from
who love you: your family, your friends, your rel-
the key,"
people
atives.
No
my loyal
cessful.
Then
other business does that.
got
I
my family to
be
customers. If you can do that too, you'll be suc-
You
sign
up
a
few people and you train them.
they sign up a few people.
It's
the simplicity of the
concept that makes Excel work."
/ never
see Excel ads
on TV.
companies and
really big
It buys service from the
resells
it.
Excel
decent network marketing company, but
may
is it
be a
a real
phone company?
The American economy's dramatic
transition
from
a
manufacturing-based economy to a service-oriented one
is
forcing us
all
stitutes a real
to
change our mind-set about what con-
company with
real products.
and information technologies have
definitions further
We
Automation
altered traditional
still.
used to judge a company's muscle in the market-
place based
on how many
subsidiaries,
premium
is
and
plants, warehouses, employees,
retail outlets it
maintained. Today, a
placed on shedding those things.
Many
busi-
nesses are outsourcing functions they used to perform
in-house.
What you own
or
what you make
is
less
important than what you organize and orchestrate on
behalf of the customer.
168
It's all
about
logistics.
No More Excuses
Suppose you run a publishing company that needs to
move
a load of
books from Boston to Washington, D.C.
own
pri-
just too expensive
and
your
in three days. You've long since discarded
vately
owned trucking
fleet. It
was
required you to be expert in a business totally different
from publishing. Calling
couple of
a
dozen trucking companies, a
air freight outfits,
and maybe
money
waste of your time and
a transportation logistics
a railroad
too. Instead,
company,
tell
them
is
a
you contact
the kind of
service
you need, cross-checked by what you're prepared
to pay,
and you
let
particularly care
the
company
figure
out.
it
You
whether the company owns
don't
own
its
trucks, leases them, decides to outsource the business to
a partner
company, and you don't care whether they put
your books on an airplane or on the
about and what you're paying for
on-time service
The
task for
someone
tor
it
at a
is
a safe, dependable,
transportation provider that performed your
you
is
else's
no
less a real
company because
trucks or because
it
to carry
used
it
asked an owner-opera-
your
competitive, just-in-time economy,
you
care
competitive price.
had under contract
efficient,
What you
rails.
freight. In today's
it's
a
more
useful,
and customer-oriented company because
it
put
first.
Consider another service industry: banking. The
bank
that grants
"buys" the
you
a loan does not
money from
you, the borrower. In
its
own
that
money.
depositors and "resells"
fact,
telephone reselling
it
is
It
to
a
169
Chapter Eight
common practice and
own national trade
a well-established industry with
the Telecommunications
group,
A
Resellers Association.
its
recent report from the
Dow
Jones news service explains:
Because
all
the U.S.'s
phone
—
sell
their service
others' cable networks.
.
.
.
rates.
They
also
they don't maintain
handle
billing,
Bundling and
way
find a
by buying time on
and
sell
them
at
have reduced costs because
facilities,
although they normally
customer service and
sales.
selling excess capacity to those
to resell
at a profit
it
is
transaction for the original supplier
Unsold capacity
owned by just
These firms buy the min-
utes in bulk at wholesale prices
higher
is
most phone companies
a handful of companies,
more than 800
cable
much
is
becomes a squandered
like the
asset
a mutually beneficial
and the
empty
reseller alike.
airline seat that
once the plane takes
off.
Excels supremacy in this endeavor as well as the
bility
of
by the
its
supply of long-distance capacity
caliber of
its
Worldcom, MCI,
Nonetheless,
if
who
is
sta-
illustrated
business partners, companies such as
Frontier,
and IXC Communications.
the credo "change or die" rings true in
business generally, that goes double for the fast-paced,
competitive world of telecommunications.
Kenny
Troutt's ceaseless drive to
It
explains
improve the marketing
plan and diversify the product offerings, even beyond
telecommunications.
And
to purchase nine switches
170
it
explains Excel's recent plan
from Lucent Technologies and
No More Excuses
to acquire Telco
with
its
own
Communications Group,
fiber-optic
network already
a
company
in the ground.
Serving as a major long distance reseller will surely
remain a core component of Excels business. Yet the new
switches and the Telco acquisition are seen as necessary
emerging markets such
prerequisites to entering
and
phone
service
known
as the personal
Finally,
anything
mobile phone technology,
communications system (PCS).
keep in mind that almost anyone
retail is selling
made and
who
sells
something that has already been
sold at least once before. If
gest that reselling
real,
digital
as local
phone
service
is
you want
anything
legitimate business, you'd have to say the
to sug-
less
than a
same thing
about any 7-Eleven, Macy's, or Wal-Mart.
/ heard that Excel got into trouble with the Better
Business Bureau. What's the story?
All of the
companies
in the highly competitive long-dis-
tance telephone market have been grappling with an
practice
gal
known
as
"slamming," which
ille-
refers
to
switching a persons long-distance service without his or
her knowledge or consent.
A
significant increase in con-
sumer complaints about slamming
munications Commission to crack
led the Federal
down on
Com-
the practice.
In September 1996, the chapter of the Better Business
Bureau serving the Dallas area
Excel's
membership
was an increase
in the
in the
briefly
revoked
Bureau because of what
it
said
number of customer complaints,
a
171
Chapter Eight
number of them
related to
temporary drop
itated a
That membership was
slamming. The action precip-
in the
company's stock
reinstated just three
price.
months
later,
once Excel had an opportunity to review for Bureau
the entirety of
cials
commitment
its
to prevent
offi-
record and the intensity of
its
slamming within the ranks of its
Independent Representatives.
The company's
policy,
which
it
underscores repeat-
edly to anyone selling Excel products and services, reads
law and order, Texas-style:
like
The slamming of a customer
service
is
to Excel long-distance
prohibited by Excels Policies and Procedures
as set forth in every Excel
application
Independent Representative's
and agreement, and
will result in the
immediate termination of representative
forfeiture
of all commissions. Excel
status
will refer
and
who
Reps
slam customers for criminal prosecution.
/ dont
all this
of selling things, I didnt
education just to end up as a sales rep.
like the idea
Although
selling
is
it
many cultures,
frowned upon by many in our sta-
enjoys a proud tradition in
inexplicably
tus-oriented society. This attitude
who
is
often seen in people
have impressive-sounding jobs but modest incomes
and no control over
around many highly
their time. Since
skilled
sionals in law, politics,
I
work
and status-oriented
in
all
the time.
and
profes-
and the corporate world,
into condescending attitudes
172
receive
I
run
No More Excuses
many from
For
the so-called
an independent business through net-
erations, building
work marketing simply
image
cultivated
They
als.
security.
crave
They
comes from
boomer and yuppie gen-
doesn't jive with their carefully
as worldly-wise, white-collar profession-
title,
rank, status, and,
most important,
seek the identity and social approval that
their association
with a prestigious blue-chip
company, a big-name law firm, or an important govern-
ment
agency.
worst nightmare
as if their
It's
is
to be
asked by a total stranger on an airplane what they do or
where they work and have the person
never
say, "I've
heard of it."
This attitude
tus jobs
lifestyles
people
is
changing. As the security of the sta-
dissipates
and the
frenetic,
they bring lose their appeal,
who
pressure-cooker
many
professional
used to dismiss network marketing are tak-
ing another look at companies like Excel. There's only so
many
times one can see others build
rewarding
can't
I
lives
we
look
at the
tives as well as coaches,
most
successful people in Excel,
and corporate execu-
homemakers,
and small business owners.
the old, the married
why
like that?"
see doctors, lawyers, professors,
ple,
more
happier,
before one stops and says, "Hey,
do something
When we
much
and the
We
real estate salespeo-
see the
young and
single, the college-educated
and the high school dropout, the African-American, Hispanic, Asian, as well as white American.
coming
to the business at a time
and out and those who were
when
We
see those
they were
sitting at the top
down
of another
173
Chapter Eight
but wanted to succeed in something different. In
field
short, if you're looking for
someone
just like
you who has
succeeded in Excel, you'll find that person!
Excel
uniquely positioned to tap into the rich vein
is
of disgruntled professionals. Look
not
household goods, or cosmetics, but
diet supplements,
state-of-the-art
at the products:
telecommunications
services.
What
could
be more cutting edge than that?
So picture the next time you're
(probably in
You're reading a
first class).
the person next to
sitting
you
is
filling
on
that plane
good book while
out corporate expense
He asks you what you do, and you say: "Me? I
own my own telecommunications business." Then sign
reports.
him
up!
/ worit be very good at selling. Can I do
Fear of rejection
ups.
I
know
it
—
the
it's
it?
most natural of human hang-
enjoyed great prestige and power
well. I've
serving in top government political and policy positions.
Several years ago, after an eight-year stint in the Califor-
nia governor's office,
I
attempted a transition.
I
left
my
powerful position to build a public relations consultancy
in
which
had
I
to sell
years of having the high
suddenly
out
I
status,
had
174
professional services. After
and mighty knock on
knock on
theirs
without influence.
thought were
way when
to
my
I
my
was
I
loyal friends.
in
my
—without
had
At
to rely
least
political office.
my
title,
door,
with-
on people
I
they acted that
But
I
quickly
No More Excuses
learned the bitter truth of President Harry S. Truman's
memorable
you want
a friend in politics, get
dumped my
consultancy and beat a
advice: "If
a dog!"
Within
a year,
I
hasty retreat back to appointed political office, at
and
stature than
was only
many
held
I
had
before.
after reflecting
on
this
me
fear
vices because
you countless
relate to
is
did everything
I
ser-
Team of
top performers
rejections as they have built
keep on going and keep on push-
great advantage Excel has for those struggling
with insecurity about selling
is
that those
you
first
customers and customer gatherers are those
the least likely to reject you. If
members and good
approaching and
you're
my
their universal advice.
One
as
of so-called
was afraid of being turned down. Virtu-
I
their businesses. "Just
ing"
what
realized
promote myself or
everyone on Excel's Eagle
could
I
slights
of rejection.
possible to avoid having to
It
experience and meeting
back was not the perceived
my own
pay
was going backward.
people in network marketing that
friends but
ally
I
less
friends
who might
you know
who
a
target
who
are
few family
you're comfortable
be willing to help you out,
on your way! Your discomfort
level
is
further
addressed by the frequent meetings, training sessions,
rallies,
and other forums Excel organizes around the
country. Invite your friends and associates to these meetings
and
let
others present the business plan for you.
Are you thinking that you don't know enough people
to build a large
enough network marketing business? You
175
Chapter Eight
might be surprised how many
you can bring
to the
been estimated that the typical American
table. It has
adult over the age of 25
their first
assets
knows about 2,000 people by
names. Chances are you've already got a poten-
network of Excel customer gatherers and you don't
tial
even
know
it.
Does anyone
really get rich in this
a few at the top?
besides
Turnover
is
high throughout the network marketing
industry. People
some
time. In
modest
tively
some
to earn
new
kind of business
car,
move
cases
set
in
it's
and out of the business
because they've achieved the
of goals they established
extra
all
money
to
the
rela-
at the outset:
pay off a few
or finance a dream vacation.
bills,
buy
a
Others join
because they like people and want opportunities to
socialize
and broaden
their
network of
friends,
but they
never focus on making the business their full-time occupation.
Some
are initially attracted
by the low entry
but don't enter the business with any serious
commitment. Then there
are those
other businesses of its type
who
rience
who
level
fee
of
leave Excel or
have soured on the expe-
and believe that the deck was stacked against
them. The riches they had envisioned didn't materialize,
and they blame the company.
Excel
world
176
tries
as easy
to
and
make your entry
painless as possible,
into the business
and
it tries
to see
No More Excuses
that
is
you
get paid for your efforts as quickly as possible.
not a get-rich-quick scheme, however, and
It
has never
it
claimed to be.
It is
true that
most people who join network market-
ing companies do not develop incomes to the level at
which they can
leave their regular jobs
dramatically change their
ors in
life,
lives.
behind and thus
Like most other endeav-
you get out of it what you put into
it.
In fact,
the Direct Selling Association has reported that while
who go
those
at these businesses full-time are a distinct
minority,
more than half of the
$50,000 a
year.
One
make
full-timers
makes over $100,000.
in ten
Think about those odds.
Reflect
on the
fact that the
average full-time salary in the United States
$28,000 per
With
year.
serious
tions in
skill levels,
money working
marketing would
just
your chances of
full-time in
network
match and beat most occupa-
easily
America today.
is still
the exception of professions
requiring extremely high
making
over
Is it
possible for
you
to achieve
the milestones attained by the Excel leaders profiled in
this
book?
Absolutely not.
Is it
worth
the final analysis, only
Much
Are
Absolutely.
it
there
for
you
any
to give
it
a try? In
you can answer that question.
depends on the status of your own
own unique
guarantees?
definition of
life
and your
what constitutes success and
personal happiness.
Remember, not
calculated in dollars
all
the value of this business can be
and
cents.
A
great deal of personal
177
Chapter Eight
How
growth comes with building an Excel business.
you measure
in dollars
do
and cents the value of these
potential benefits:
o
You
can have more time to spend with
as parents
your children.
o
You
don't have to say, "No,
when your
o
child asks for
we cant
new
afford
it"
clothes.
someone
After a lifetime of working for
you
else,
get the chance to build something for yourself
and your family on your own, even
pulling in
o
You can
less
if you're
income.
face the prospect
cial security, so
of old age with finan-
you needn't
fear
becoming
a bur-
den on your children.
o
You can make
lifelong friends
cessful people, people
over the country,
from
among
all
highly suc-
walks of life
whom you would
all
never have
met otherwise.
You can enjoy
the wonderful satisfaction that
comes from helping others achieve
dreams
too.
How do you measure
1
college student
I
178
in dollars
and
cents?
when
I
was a
earned a couple hundred dollars a
bussing tables in the campus dining hall to help
pay for books and
been
any of that
have often reflected on the fact that
month
their
much
tuition. In retrospect,
better prepared for adult
life
I
would have
ahead
if
I
had
No More Excuses
begun
Even
a low-cost
network marketing business instead.
earn a penny more,
if I didn't
would have been
I
learning the fundamentals of operating
and those
wiping
skills
would have been
my own
business,
more valuable than
far
tables.
Let's say you're half
and your spouse
of a working couple and both you
are holding
down 40-hour-a-week
jobs
outside the home. You're pulling in $30,000 a year but
paying thousands a year for child care you don't really
trust.
How much
Excel
would
stay
home
it
income from building
take to convince
you
to quit that job
with your kids, considering the
wouldn't spend on child care and
benefits
a business like
all
you would enjoy by being
less
than that $30,000
a full-time parent
and
would
take
—and
the far superior potential of earning
one of us has
and
to cross-check
priorities against the
make
it
there
much
would be
more. Each
our individual circumstances
chances of success in Excel and
a personal evaluation as to
Isn't the
money you
the other ancillary
an independent business owner? For most,
considerably
and
its
worth.
market already saturated? Dorit you have
get into this kind of
company
to
right at the start to
really succeed?
Excel today claims about 3 percent of the long-distance
market.
On
$1.4 billion
the strength of just that 3
company
percent,
a
has been built and tens of thou-
sands of individuals and families have founded their
own
179
Chapter Eight
businesses,
becoming
some achieving
independence and
what
millionaires in the process. Just imagine
4, 5, 6, 16, or
20 percent of the market could
the concern
Still,
financial
is
a real
one
for
many
sustain.
prospective
Excel Independent Representatives. Current IRs
they hear that question
all
the time.
tell
me
During a recent
speech to Reps and their guests in Los Angeles,
Kenny
Troutt declared that the opportunities in Excel are just as
great for those starting in the business today as they were
for top earners like Paul
Orberson
gentlemen disagreed and blurted out,
Without missing a
beat,
One
several years ago.
Kenny
"Oh
yeah, right!"
spelled out his vision
of the company's future opportunities. There's going to
be
far
more
to Excel than the long-distance market, he
explained. There's a whole range of additional products
being offered, from paging to international
there's all the exciting
new
calling.
Then
on the horizon,
directions just
including local calling, international markets, and
dential electricity.
even
know about
"And
yet,"
there are other products
Kenny concluded.
I
don't
we
resi-
don't
know
if
he changed the dissenter's mind, but judging from the
reaction of the audience, he convinced everyone else.
Will I be pressured into spending a lot of money on
training materials, meetings,
Excel
is
one of the cheapest ways
yourself.
180
and rallies?
There
are
no products
to get into business for
to buy,
no inventory
to
No More Excuses
stock,
and no
significant financial investments to
Getting started
just a
as
an Independent Representative requires
$50 refundable application
recommended, however,
strongly
make.
deposit. Optional but
is
an accompanying
and home business management package, which
training
qualifies
you
Managing Representative and
as a
$180 annual renewal
$195 with
a
important
tools,
this
fee.
Among
costs
other
package includes the monthly
Communicator magazine, which contains new product
announcements and important business-building
ideas.
Representatives are encouraged to take advantage of
other education, training, and motivational opportunities,
such
as the Excel's
Winners Weekends held around
the country, the annual Excelebration in Dallas, and
video programming produced by the company's Excelevision television network.
ties,
but
all
There
are fees for these activi-
many Reps find them
improving their own skills but to
are voluntary. Still,
invaluable, not only for
introduce friends and associates to the business as well.
It's
curious that
some
would focus on the
suggest
is
some
involved.
sort
critics
of companies
like
and motivational
training
Excel
tools to
of undue pressure or wasteful expense
How many of us
have gone deeply into debt
and spent untold thousands of
dollars to pursue higher
education for ourselves and our children?
able to spend several
hundred
Is it
unreason-
dollars per year to
go into
business for oneself and secure the necessary training
and
information to succeed? You be the judge.
181
Chapter Eight
I'm too busy. Will I have the time for Excel?
Ah
yes, the old "I don't
the most
common
have time" excuse!
It's
probably
brush-off prospecting network mar-
keters hear. Recall our discussion in chapter 6 of the
time poverty experienced by
struggling with both
children. There's
However,
many two-income
demanding
no question
careers
and
raising
huge burden.
that's a
new book by time study
a
families
John
experts
Robinson and Geoffrey Godbey suggests that most of
new
us probably could find the time to undertake a
activity like starting
priorities.
an Excel business.
It's
a question of
These researchers examined the
lifestyles
of some 10,000 survey participants and concluded
that Americans actually have
at
any time in the
last
more
free
time
now
than
—an average of 40 hours
30 years
a week.
If
you find
that hard to believe, consider that
the study's most important conclusions
perception of
ity.
how busy
is
that people's
they are often differs from
Study participants were asked to keep detailed
of their
activities.
When
one of
the results were analyzed,
real-
diaries
it
was
found that on average, working men perceived that they
spend 46.2 hours on
actuality
their paid, professional work. In
they spent 40.2 hours.
Women
perceived
40.4 hours but actually worked just 32 hours.
What's the reason for the exaggeration? "Being busy
has
182
become
a status symbol,"
Robinson told Newsweek
No More Excuses
recently. "As
you say time
become more important
is
more important
for
on
to report, "Americans
working fewer hours than they did
fewer hours per week for working
five
you
yourself."
"In fact," the magazine goes
are
to you,
in 1965:
about
women,
six
average,
working
fewer
men."
on
Here's one other key finding:
Americans spend
ing television!
If,
1
5 of their
like
40
free
me, you're one of them, perhaps we
should reexamine our priorities and
that
most
common
also
It's
compared
hours a week watch-
of excuses:
how
"I don't
readily
we
offer
have time."
important to remember the simplicity of Excel
to
other network marketing opportunities.
no products
time-consuming
There
are
ies to
make. Your customers reorder every time they pick
up the phone. So
if
to stock or
time
is
deliver-
a factor, then being in a service-
oriented business rather than a product-based business can
minimize the time
it
takes to give
it
a serious effort.
Overcoming the Negativity
As you consider these important
issues
whether
is
rise
this business
opportunity
and determine
right for you, try to
above the negativity that has invaded so
lives.
The only way you can
company and
believe
the people in
much of our
credibly doubt whether this
it
face a positive future
is
to
one or more of the following statements:
183
Chapter Eight
o
Negative Statement #1 Telecommunications
:
is
a
dead-end, shrinking market in the U.S. and
around the world.
o
Negative Statement #2: Network marketing has
peaked
and
as a business force,
professionals are
going to be rehired in droves by corporate America in secure,
o
high-paying positions.
The
Negative Statement #3:
shortsighted, complacent,
leadership of Excel
and content
to rest
is
on
yesterday's achievements.
o
Negative Statement #4: Americans have stopped
dreaming of a better
to
If
you
life
do anything about
really believe
you can find reason
and have stopped trying
it.
any of these statements, then
to call into question the future of
Excel and your potential role in
it.
But
if you believe that
global telecommunications will continue to be
by unparalleled growth;
the
yes,
if
you
believe in the
network marketing approach
marked
power of
bring millions
to
of additional people into low-cost business ownership;
you
believe in the vision of
Kenny
if
Troutt, Steve Smith,
Jack McLaine, and the Excel leadership to continually
try exciting
new
directions;
dreams of average Americans
and
if
you
believe in the
to achieve financial inde-
pendence and that you can achieve that dream and help
others do the same, then there are no
and no more
excuses.
more questions
Chapter Nine
IMAGINE!
FRIDAY,
May
16, 9:30 P.M. Inside the
auditorium
of the L.A. Convention Center, the beat goes on.
Excel Presidential Director Al
up
his talk. "I'll see
the top."
The crowd of
the start, roars
man
you
its
at the
1,500,
top
—
or
Thomas wraps
I'll
see yo\x
from
more energized than
approval. Forty rows back, a
at
young
whispers a Spanish translation into the ear of
his elderly mother.
She smiles and nods
in agreement.
Steve Smith takes the stage to an outpouring of reverence
and
affection. In a strong, reassuring tone,
claim that captures
the
he makes a
imagination of the crowd:
"You're not going to recognize this
company
a
few
months from now."
185
Chapter Nine
The people
many
and
cheer,
are afraid of
I
wonder. In an era when so
change and attempting to fend
it
off,
the leaders of Excel have embraced change and have
made
it
their loyal customer.
As Steve
finishes
excitement works
its
time for Kenny," a
piece suit
tells his
During
and the hour grows
way around
man
late, a
the hall.
"It's
buzz of
almost
impeccably dressed in a three-
wife.
a coffee break earlier in the evening, Steve
Smith and Kenny Troutt decide
to
make
the rounds of
the lobby. Standing at separate ends of the room, each
is
quickly immobilized by a throng of Excel Representa-
and prospects surrounding them. The crowd
tives
rounding Steve engages him
relate a specific experience
sur-
in earnest conversation, to
out in the
field
and perhaps
pick up one more piece of important advice from the
master network marketer.
The crowd around Kenny
has
another mission: autographs and pictures. Steve Smith
may
be their teacher. Kenny Troutt
It
stage
it
could go on for hours.
and
is
is
Finally,
Kenny Troutt
tells
He
achievement in
186
is
led to the
"We
built
the cheering crowd.
"That's the strength of this company.
o
Kenny
introduced to a standing ovation.
together,"
different."
their leader.
It's
what makes us
reviews with great satisfaction the pace of
just nine years, citing these facts:
one of the youngest companies ever
Excel
is
listed
on the
New York Stock Exchange.
to be
Imagine!
o
It
recorded $1.4 billion in sales in 1996 and
is
only the third company to achieve such a
height through internal growth in so short
a time,
o
It
shows a 200 percent increase
from communications
in revenue
services in just
one
year.
o
Excel customers used 6.3 billion minutes of
long distance time, a 198 percent increase in
just
o
Excel
in
o
one
is
year,
the fifth-largest long distance
America
in terms
of presubscribed
In just a matter of months, the
introduced powerful
new
company
lines,
company
has
products, such as
paging, international calling, and a
flat,
10-cents-per-minute rate for long-distance
calls
o
anytime, anyplace,
Enriching improvements have been
made
in
the marketing plan, giving Excel Representatives
more ways
to
make money
faster.
"We've changed the way business
is
done
in the
com-
munications industry," Kenny concludes. But his focus
has already shifted to the future. "I feel
today than
I
did four years ago,
more
excited
when our company
really started to blast off. In the next five years, we're
going to experience a
boom
boom
like a
of the past look
that's
going to make the
oil
poverty zone!"
187
Chapter Nine
Saying No
to "No"
What makes Kenny
future?
It
Troutt so confident about the
begins with an attitude, one that looks for-
ward, embraces change, and refuses to accept the limitations
imposed by conventional wisdom.
One
of my favorite
ing in India
makes
its
20
who came upon
attitude towards
fectly clear.
sign
stories
Upon
about a foreigner
a cafe in
its
lines long:
NO Talking to Cashier
NO Smoking
NO Fighting
NO Credit
NO Outside Food
NO Sitting Long
NO Talking Loud
NO Spitting
NO Bargaining
NO Water to Outsiders
NO Change
NO Telephone
NO Match Sticks
NO Discussing Gambling
NO Newspaper
NO Combing
travel-
Bombay. This
customers
—and —
entering, diners are greeted
SORRY
188
is
life
by a
cafe
per-
large
Imagine!
>
NO Beef
NO Leg on Chair
NO Hard Liquor Allowed
NO Address Inquiry
As Kenny Troutt gazes out over the booming Dallas
metroplex from the top of Excel headquarters, the
youthful 49-year-old executive sees a world of opportunity.
Words
like "no," "don't,"
and
"can't" are alien to
his vocabulary.
"Our
greatest challenge
the mix," he says.
The
is
to put
strategy
built-in distribution system of
tives
and
their
customers to
is
new products
into
to use Excels powerful,
Independent Representa-
move
quickly into the most
promising new arenas of products and markets.
I'll
dis-
cuss several of them in the sections to follow.
Paging
In the
fall
of 1996, Excel took an important
initial step
toward diversifying beyond residential long-distance
vices
ser-
by launching ExcelPaging. More than 40 million
Americans use
this
simple and affordable technology, up
from 27 million since 1994. Industry analysts believe
that
by the year 2000
as
many
as
72 million people
will
carry pagers.
Paging
is
a logical extension for Excel. Pagers are
small, portable, easy-to-use,
indispensable to
many
and
cost-effective. They're
different types of businesses
and
189
Chapter Nine
More and more,
professions.
ing to stay in touch.
families are
The new
employing pag-
generation of high-quality
Motorola numeric and alphanumeric pagers, paging with
voice mail, and nationwide single-frequency paging services
add value
to the basic paging function.
True to form, Excel was able to offer
new
this
service
without incurring the enormous capital expense of
acquiring or developing paging transmission frequencies
or infrastructure.
ucts
and
The company
services like
believes that
paging will strengthen
to switch.
Most important,
warm-up
kets.
move
the
pitch for even bolder
"Our
ties to exist-
new customers one
ing customers and give potential
more reason
new prod-
initial
to
paging
is
a kind of
moves into bigger mar-
foray outside Excel's fundamental line
of long-distance services provides a model for developing, acquiring,
and
services,"
Wireless
and introducing other communications
company
executives have stated.
Phones and the
Personal Communications System (PCS)
Less than a decade ago, there were just 2.1 million cellular
phone
subscribers.
"They were viewed mainly
for the rich or tools for executives
and drug
as toys
dealers,"
observed Time magazine recently.
Not anymore. Today, an estimated 43
million Ameri-
cans use wireless phones, which means the wireless
phone market has grown
190
faster
than the market for video
Imagine!
recorders or fax machines at a comparable stage of devel-
opment. Even
so, the
$25
billion cell
phone market has
penetrated just 20 percent of the nation's homes.
still
There's plenty of
fact that
companies are
scribers at the rate
The
room
for growth, as evidenced
frenetically signing
of 30,000 a
tribulations of
by the
up new sub-
day.
modern American
life
explain
part of this technology's appeal to average citizens.
schedules and longer
attractive
Many
way
commutes make
to stay in
families
Busy
phones an
cell
touch and increase productivity.
view such phones
as offering
an extra
measure of security should a loved one run into trouble
away from home or encounter
car problems
on the
road.
Steady cuts in service cost, thanks to deregulation and
the resulting intense competition, have put wireless call-
ing well within reach of many family budgets.
Improved quality with an exciting array of new wireless services is
of a
new
on the horizon
digital service called
cations system),
cations
made
possible
too, thanks to the creation
PCS
(personal
by the Federal Communi-
Commission (FCC). The Time
"The agency took
communi-
article explains:
a piece of the airwaves in the mid-fre-
quency spectrum that had been used
other public purposes and turned
it
for police calls
and
over to industry for
cell-phone service."
The move
$20
billion
—which
when
it
netted the government
auctioned the licenses
—
more than
will create a
15-fold increase in wireless capacity in the next several
years.
But
that's
not
all.
"Unlike
many
older systems,
191
Chapter Nine
which send
PCS
a voice in a single stream as analog waves,
Time
uses digital signal," the
"Digital technology enables
e-mail, caller
quality
ID and
sound and
PCS
to offer such features as
paging, as well as compact-disc-
from wireless eaves-
greater security
droppers and phone
article continues.
number
thieves."
The expansion of new companies and
phone market
into the cell
the
price
of confusion.
technologies
has, however, carried
Echoing
with
advertising
past
shootouts by major companies over long-distance
vice, wireless providers in
a
many
it
ser-
markets have thrown up
complex barrage of claims and counterclaims over
competing pricing and
price
and image war
relationship selling
is
service plans.
anticipated.
A
With
and customer
down-and-dirty
its
emphasis on
loyalty,
Excel once
again appears uniquely positioned to help
its
customers
cut through the noise.
Local Phone Service
On
February
8,
1996, President
Bill
Telecommunications Act of 1996 into
This
first
in almost
tives
by
lation
Clinton signed the
law.
major overhaul of telecommunications law
62 years passed the U.S. House of Representa-
a vote of
by a 91
4 14 to
16.
The
to 5 margin.
Senate passed the
legis-
At the signing ceremony,
Vice President Al Gore said that "the Berlin Walls of the
telecommunications industry have crumbled." In the
eyes of
192
FCC
chairman Reed Hundt and others, the old
Imagine!
law assumed that communications was a natural monopoly; the
new law assumes
that
made
cations marketplace can be
The
parts of the
all
competitive.
stated intent of the Act
is
to let
anyone enter
the communications business. Before the
would have been
some
illegal for
communi-
local
new
law,
it
phone companies
to provide long-distance service outside their regions.
Competition
some
phone markets was
in the local
illegal in
states.
Today, both are
Local phone companies can
legal.
offer out-of-region long-distance service; long distance
companies
And
like Excel
can offer local telephone service.
these markets are not just limited to telephone
panies. If the legislation
works
the future might receive local
Internet provider or
They could
what
get television
phone company and
distance carrier
—
or
company
their
their local
phone
service
from
from
their long
a single
com-
utility.
rivals for their
phone
from
programming from
FCC
commissioner Susan
cable companies, faced with
enter the local
band
now
service
company.
is
In fact, according to
many
phone
these services
pany, perhaps their local
Ness,
planned, consumers in
their cable
local
all
as
com-
new
telephone
video business, are poised to
business. Their wires, with broad-
capacity, already pass
through more than 90 per-
cent of the nation's homes.
However, the cost of
upgrading these wires for telephony by adding a power
source and switching capability would require a heavy
investment.
193
Chapter Nine
The
prospect of these heavy investments in ever-
changing
technologies
— along
with
the
increasing
market demand that a company bundle diverse
and
offer
—
customers one-stop shopping
forecast that the
has led
services
some
to
Telecommunications Act of 1996 would
spur a wave of mergers throughout the industry. To the
dismay of many observers
a
throwback to the
May
In
AT&T,
still
local
such consolidation
see
the
may
past, those forecasters
1997, for example,
dominant
engaged in merger
parent
who
talks
was revealed that
with
SBC
including Texas and California.
was
Communications, the
Bells that
in the southwestern
firestorm of criticism
right.
force in long distance,
company of the two Baby
phone market
it
be
as
The
dominate the
United
States,
reports unleashed a
and the two companies have
since
backed down.
The
reason was anticipated by the Los Angeles Times:
"Although the Telecommunications Act of 1996 cleared
way
the
for
new
phone markets,
an
AT&T-SBC
alliances in the
long distance and local
severe regulatory hurdles could prevent
combination for
several years, perhaps
forever."
Industry analysts, legal experts, and consumer advocates
immediately began assessing the proposed merger's
Some
impact, viability, and symbolism.
at a deal as further
tion.
"The
AT&T
of equals with one of its progeny
194
attempt
evidence of AT&T's weakening posi-
revelation that
once-invincible
see the
company
is
is
considering a merger
seen as a sign that the
has failed to capitalize on the
Imagine!
new telecommunications
opportunities of the
market,"
the Los Angeles Times continued. Los Angeles Times business columnist James Flanigan
AT&T
and
complained that "maybe
SBC Communications
were inspired by a
dinosaur movie. In their merger talks they're trying to
restore a lost
world of monopoly suppliers of telecom-
munications services."
Flanigan continues:
The Telecommunications Act of 1996 opened
phone
service to
biggest
going
new
all
competitors.
And one
billions
of investment to gain local customers.
talks disclosed
.
.
chosen to acquire
.
say that
its
SBC and
way
AT&T,
AT&T has
after the lucrative local business.
purchasing
of the
competitors was supposed to be
mounted campaigns promising
local
.
of dollars
.
.
Yet the
AT&T once again has
into local markets,
eliminating a competitive
contest for customers.
University of Southern California communications
professor A. Michael Noll echoes Flanigan's sentiments:
"Management of
the communications industry seems
unable to offer anything more creative than acquisitions
as a
sor
way
to shape the future." Stanford University profes-
William Baxter,
effort to break
Ma Bell
all
up
who headed
AT&T
the Justice Department's
in 1984, said flatly,
"This
is
over again."
Consumers Union codirector Gene Kimmelman
slammed
the merger talks as well. "This basically
moves
195
Chapter Nine
in the opposite direction of the competition goals that
Congress had in mind under the new Telecommunications Act," he said.
While many
kind
as
toward mergers of
see the trend
this
eliminating consumer choice and making
it
harder for companies like Excel to compete, other ana-
"No matter what
lysts disagree.
we've
new
got
still
MCI,
AT&T
GTE, and
Sprint,
a
and
SBC
do,
huge number of
entrants," observed industry analyst Sandra
Cook of
the San Francisco Consulting Group. "Even if those two
giants merge, there
is still
going to be plenty of competi-
tion in the marketplace."
Competition
just
is
what Kenny Troutt has
Giant companies trying to merge
and
eral
state justice
millions of dollars
paigns,
on
"We
the
$1
1
7
cam-
all
so they can
move
new
combine
ones. Meanwhile,
com-
his nimble, proactive
phone
service sweepstakes
he told Excel Representatives in
May
1997.
most powerful product on the horizon.
acquisition of Telco, with
its
Unlike mega-deals
like the
We
The
existing telephone network,
clearly designed to hasten the
march towards
that goal.
one discussed between
and SBC, the Excel-Telco merger
196
—
billion market.
could virtually double our business overnight."
is
cur-
could be announcing something by the end of
this year,"
"It's
plans to
swiftly into the local
more than
spend years in fed-
legal fees, public relations
rent markets instead of unearth
pany
mind.
department conference rooms and
and public hearings,
Kenny Troutt
will
in
is
AT&T
seen as enhancing
Imagine!
consumer. Excel and
overall marketplace choices for the
Telco Communications
itive
into a defin-
merger agreement. The transaction, valued
billion, will create a
1 1
Group have entered
company with $2
at
$1.2
billion in revenue,
billion long distance minutes, 6.3 million customers,
and 100,000 network miles of fiber-optic
capacity.
The Global Marketplace
From around
the corner to around the world
—
the
growth potential for telecommunications knows few geographic boundaries. In the developed world, growth
is
being propelled by the trend toward privatization, deregulation,
new
and technological advancements resulting
in
products. In the developing world, the very fact that
populous
societies are poised
and ready
to enter the
telecommunications age in a big way for the
excites U.S.
and Excel
is
communications companies
large
first
and
time
small,
no exception. The global telecommunica-
tions services market, already
pegged
annual revenues, will surpass the $1
at
$600
trillion
billion in
mark
early in
the next century.
More than phone company
profits are at stake.
companies and countries that
lay
claim
to
The
global
telecommunications leadership will be those that lay
claim to global economic leadership as well. In the Infor-
mation Age, there can be no other way.
"For centuries, nations that could develop and apply
new
transportation technologies (Portugal in the fifteenth
197
Chapter Nine
century,
England
in the nineteenth century) have
global leaders of their age," writes James
Burnham of the
Center for the Study of American Business
University in
St.
Louis. In
more
Washington
at
recent times,
explains, advances in oceangoing ships
become
Burnham
and marine engine
design played an integral role, for example, in the
of the Japanese
"Thanks
rise
industry to global dominance.
steel
to innovations in transportation-related tech-
nology, the sizable costs of shipping heavy bulk materials
dramatically,"
fell
Burnham
"How
explains.
else
could
they haul coal, iron ore and scrap from Australia, Brazil
and the United
steel
back
The
first
States to
Japan
—and then
ship finished
at large profits?"
transportation
mode of
choice in the twenty-
century will be telecommunications, because the
most important product
to be shipped
is
and
will be:
information.
One
dramatic outgrowth of the development of
telecommunications
is
that service industry tasks can be
performed anywhere. "Telecommunications provides the
global transportation 'highway for the
formed by
work
Irish call center technicians,
those jobs and investments
cations infrastructure, a
skills,
and
work
a business climate
incentives to work, save
198
"is a
and
is
per-
Indian software
engineers and Jamaican data entry clerks,"
writes. All a nation or region needs to
that
do
to
Burnham
compete
for
decent telecommuni-
force with the necessary
where individuals have the
invest productively."
Imagine!
To
take part,
many
countries, rich
and poor,
em-
are
bracing the principles of deregulation and competition
that have triggered an explosion of
growth in the U.S.
market and have paved the way for companies
o
Since the United
British
Telecom
European
Kingdoms landmark
in 1984, there have
privitizations,
mostly
like Excel:
sale
of
been nine
partial.
Some
have been wildly popular with investors. Spain's
Telefonica de Espana, for example,
is
currently
Europe's hottest telecom stock.
o
This year alone, $30 billion worth of privitizations are underway,
compared
to just
$4
billion
in 1992.
o
In 1997, the government of Israel has
it
will sell off a big
national
will
chunk of its
announced
stake in the
phone company. Jordan and Turkey
do the same.
phone system
Brazil plans to privatize
its
in 1999.
Says the International Telecommunication Union's
Tim
Kelly: "I think that
against competition
is
pretty
much
"Look
around the world, the argument
on the
basis
of a natural monopoly
dead."
at the Philippines," Kelly continues.
competition was introduced, the number of
phony
"Since
new
tele-
subscribers each year has gone from between
10,000 and 20,000 a year to 200,000 a year."
A
top
199
Chapter Nine
telecommunications
is
a
Hong Kong notes: "There
among policymakers and politi-
official in
growing acceptance
competition and liberalization
cal leaders that increased
of telecommunications encourages infrastructure devel-
opment, draws inbound investment, and
assists in
meet-
ing universal service objectives."
Giant providers and entrepreneurial upstarts
eagerly await the chance to
that exist
o
fill
alike
the huge gaps in service
around the globe. Consider the following:
For more than half of the world's 5.7 billion
people, the primary
means of communication
is
not the telephone.
o
In richer countries, there are 50 lines for every
100 people.
o
In low-income countries
—
gross domestic product of
those with a per capita
$725 or
were fewer than two phone
less
—
there
lines for every
100 people. In some Southeast Asian countries,
such
less
o
as Laos,
Myanmar, and Vietnam,
there
is
than one phone line per 100 people.
In the world's most populous country, China,
there are only about 3.3 phones per 100 people.
o
Hong
Kong's seven million inhabitants have
more phones than do
Indonesia's
200 million
people.
o
While the United
States has
150 million phone
200
more than
lines servicing a
240 million
Imagine!
population, India has just 13 million for
930 million people.
The
paucity of phone service in Asia will change dra-
matically overnight.
his recent
As
futurist
John Naisbitt writes
in
book Megatrends Asia:
The Asian
continent
world's population.
now
accounts for half the
Within
or
five years
less,
more
than half of these Asian households will be able to
buy an
array of consumer goods
—
refrigerators, tele-
vision sets, washing machines, computers, cosmetics,
etc.
And
the
West understands
is
as
many
roughly the
size
as a half billion
as
middle
people will be what
class.
That market
of the United States and Europe
combined.
Naisbitt identifies other developments that
make
Asia a natural prospect market for U.S. telecommunications products
o
and
services:
The number of Asians
from 400 million
of World
War
II,
increased another
o
to
in poverty has decreased
180 million since the end
even while the population has
400
million.
The growing Asian middle
Japan's, will
class,
not including
have amassed $8 to $10
annual spending power shortly
trillion in
after the turn
of
the century.
201
Chapter Nine
o
Currently,
more than 80 million mainland Chi-
nese earn between $10,000 and $40,000 a year.
In South Korea, 60 percent of those
themselves as middle class
One
year.
make
who
describe
over $60,000 a
million families in greater Bangkok,
Thailand, earn over $10,000 annually.
These
are not the
who
kind of consumers
will
remain
telecommunications-deprived for very long!
Several years ago, while writing a
opportunities in Vietnam,
hand the
stirring
I
had
book on business
a chance to
of a nascent Asian middle
developing country.
view
first-
class in that
The pace of economic change and
the growth of consumer
—and much of
staggering
demand
it
that
witnessed was
I
was led by the
availability
of
an array of communications technologies.
In the early 1990s, just as the country was beginning
a transformation
omy
to
from a
centrally
one based on market
planned
incentives,
mier hotel in the heart of Saigon,
Minh
The
City.
I
now
socialist
stayed at a pre-
clerk at the front desk entered
There was a phone
or keypad;
and
I
had
Coming
that
in
it
to
in
my
simply connected
compete
from the
for
room, but
me
Ho Chi
my name
called
in a handwritten ledger. Bills were calculated
cus.
it
on an abahad no
I
had been converted into a
dial
to the hotel operator,
one of the two outside
airport,
econ-
lines.
rode in a vintage Peugeot
taxi.
Mine was one of the
only vehicles on the road that day that was not powered
by
foot.
202
Imagine!
On
another
trip just a year later,
rode in from the
I
airport in a brand-new, air-conditioned Toyota taxicab.
The
streets
were choked with new
Honda
motorcycles.
Arriving at the same hotel, the clerk checked
her computer and totaled
my
bill
on
too.
it
me
in
My
room
on
had a Touch-Tone telephone that offered international
direct dialing.
I
cal
also
had the opportunity
to visit a
number of typi-
urban Vietnamese homes. Over the course of several
trips I
watched those homes load up on the
and technologies
in a
most sought-after
prizes: a cellular
technology,
many
latest
breakneck fashion.
Vietnamese,
One
gadgets
of the
phone. With wireless
as well as residents
of
other developing countries, are taking advantage of the
chance to "leapfrog" technologies, bypassing the long,
bureaucratic,
based
and graft-ridden process of securing a land-
line.
no doubt tracking the
Excel's top Representatives are
growing popularity of the direct
selling
marketing approaches in regions such
America.
It's
a natural
professions are lauded
fit,
where the
as
and network
Asia and Latin
sales
and where tapping
and business
vast networks
of family and business connections are deeply rooted in
the culture.
Information technology
Americans
who
— and
trace their heritage
the sizable pool of
back to these promis-
ing markets and thus possess valuable knowledge of
culture,
language, and contacts
— make
the network
marketers potential to expand his or her "territory"
203
Chapter Nine
beyond the shores of America
fact,
greater than ever before. In
company whose name can be
the
Way
phrase American
portion of
its sales
from the United
—Amway—now
traced to the
derives a greater
from foreign markets than
exciting developments have escaped the
Kenny
watchful eye and creative imagination of
has said that one of the reasons Excel
towards
own
its
does
States.
None of these
He
it
is
Troutt.
now moving
switching and transmission network
is
to
provide the capability to develop international markets.
The
first
three switches are slated to be installed in
York, Dallas, and Los Angeles in
1
997, chosen because of
their position as gateways to the global
when we go
into a country,"
competitors and
just
doing
it
thrills
to get
New
Kenny
economy. "But
he warns
says, as
Excel Representatives, "we're not
2 or 3 percent of the market."
Electricity
Kenny Troutt
delights in telling this story:
company
a year ago,
lawyers advised
him
As recently
to
remove from
would one
his speeches optimistic predictions that Excel
day be able to go into the business of marketing
service the
will never
way
it sells
happen
Today,
its just
in
long-distance
as
phone
electrical
service. "It
our lifetime," they told him.
around the corner, and Excel plans to
be ready.
"For the typical homeowner, electricity
oly service:
204
One
either pays the
is
a
monop-
power company or chops
Imagine!
wood," writes Clyde Wayne Crews
Jr.,
a fellow at the
Competitive Enterprise Institute in Washington, D.C.
"This will change
if
Congress deregulates the $208
bil-
lion electric industry to allow individual customers to
among power companies. Economy-wide
choose
have been estimated
Some
6,
$24
at
states aren't
savings
billion annually."
waiting for Washington.
On May
1997, California regulators voted to allow power
customers to go shopping for lower rates effective January
1998.
1,
state's
$20
Week, "a
The prospect of winning
billion
market
modern gold
buy power
in
bulk
at
a piece of the
will trigger, predicts Business
rush" of companies seeking to
discounted rates and
consumers. "Under the
new
resell it to
California rules," the
azine reports, "customers can secure lower cost
from inside or outside the
ties
state,
power
paying their local
only for the costs of shipping to their
mag-
utili-
home
or
business."
In
all,
eight states
Hampshire,
Vermont,
New York,
—Arizona,
Massachusetts,
Pennsylvania,
in addition to California
Rhode
New
Island,
and
—have adopted laws
or regulatory orders providing for retail competition in
electricity
by next year or soon
Meanwhile,
after.
several bills have
been introduced
in
Congress to break up regional monopolies that major
utilities
have enjoyed since the 1930s. Predicting a "leg-
islative
donnybrook," the
New
the issue will be one of the
York Times reports that
most
closely
watched and
heavily lobbied issues before Congress in years.
205
Chapter Nine
"A high stakes
battle
unfolding in Congress and
is
across the country over legislation to give
same choice
in
buying
electricity that
consumers the
they
now
have in
and long-distance telephone compa-
choosing
airlines
nies," the
Times reported recently.
Excel will be well-positioned to once again cut
through
all
the ad racket
competitors by appealing
and nasty name-calling among
on a one-to-one
directly,
basis,
with the most loyal base of customers a company can
have: the family
members,
friends,
Independent Representatives
who
"Along with local phone
and
sell
associates
the services.
service, electricity will
one of the most powerful products out there
Kenny
five years,"
market
in less than
of the
be
in the next
predicts. "I think we'll be in that
two
years."
Imagining the Future
"There are going to be products coming into our business that
we
don't even
know
of,"
Kenny
tells
the
crowd
of 1,500 Excel Representatives and their prospects in Los
Angeles. "Together, we've gone out and changed the
business
is
done
in the
communications
industry.
can do the same in the financial industry, in
in insurance,
and
206
We
might
We
electricity,
in the international marketplace.
got an Internet plan coming.
way
offer
We've
banking
Imagine!
over the telephone, including loans and electronic trans-
of funds.
fer
The
Let's call
ideas
it
come
FirstExcel!"
and
fast
and the crowd
furious,
grows more excited by the minute. Every new product
and every new
service affords
them an opportunity
achieve their financial goals that
what
sales
would mean
it
to
of us
all
per customer from $30 a
"All
you have
to
do
is
if
much
month
to
increase our
$200
see the vision,"
"Think
faster.
we could
to
a
month."
Kenny
likes to
Tonight, they do. "The most important thing to
say.
understand about Kenny," Lisa Troutt has
when he
says he's going to
sure that he's going to
do
do something, you know
him
years ago,
for
it."
Invoking that most valuable of lessons
taught
said, "is that
Mama Nadine
Kenny concludes by reminding
the
"My mother always told me, 'On the
stars, take as many people with you as you
hopeful crowd,
way
to the
possibly can.'
"The rocket ship
is
taking off." Everyone
is
seeing
the stars tonight.
207
Chapter Ten
AN INTERVIEW
WITH KENNY TROUTT
Kenny
Troutt never
effort that has
cess. Yet, so
fails
made
his
to recognize the
young company
much about
Excel
is
a suc-
defined and
driven by the ideas, strategies, and dreams of
and
team
its
founder
leader.
In June 1997,
questions to
I
had an opportunity
Kenny about
Excel and his
to pose
own
some
life as
one
of Americas most successful entrepreneurs.
Ifyou had
to
sum up
which factors would you
Timing was
after the
forefront
the key reasons for Excels success,
cite?
a big factor. Excel
breakup of
was founded shortly
AT&T, which
placed us at the
of the explosive growth opportunities
in
209
Chapter Ten
Our
telecommunications.
choice to use network market-
ing as Excels sole distribution
key
factor.
method
has been another
Since the decision to go with network market-
growth has been tremendous. Our success
ing, Excel's
can also be attributed to our ability to provide competitively priced products
Representatives what
I
and
believe
tion plan in the industry.
our Independent
to offer
is
the greatest compensa-
Beyond
that,
our success has
been driven by the dreams of thousands of people
all
across the country. We're putting people in business for
themselves and helping them achieve their personal and
financial goals.
in
Nothing has been a more powerful
factor
our success than our ability to help them succeed
individually.
You had no background in telecommunications, yet you
build a billion-dollar telecommunications
have been able
to
company from
the
ground
up.
telecommunications industry
What
does this say about the
and about
the
American free
enterprise system?
There's
ties in
no question
there are tremendous opportuni-
telecommunications.
one of the fastest-grow-
It's
ing industries in the world. But
I
don't think
be a telecom expert to be successful. For me,
way
developing a creative
to generate
obviously, to be able to satisfy that
you need
it's all
demand and
greatest vehicle in the
It's
210
a system that
still
about
then,
in
my
is still
the
demand. And
opinion, the American free enterprise system
to
world for allowing that to happen.
rewards hard work and good ideas.
An Interview with Kenny Troutt
While your business career has been a great
and the
you have
to offer
Never
doing.
and there
tives,
your
why
of
some
are always
ones
who
possibilities
is
for the posi-
positives. Setbacks test
The people who succeed
never stop reaching for their dreams, the
never forget
Why do you
and look
you're
and getting past them and moving
forward makes you a better one.
who
what
you're doing
to take a setback
ability as a leader,
are the ones
What advice do
way?
their
lose sight
You have
mistakes?
people just starting out in business when
dont always go
things
you
What have you
have had some setbacks along the way.
learned from the setbacks
success,
why
think so
ofstarting
they started in the
many Americans
their
own
business?
first
place.
are looking to the
Do you
think this
a major, lasting trend in our society?
Most
people, given the opportunity,
business for themselves.
just free enterprise.
hand,
is
I
What
provides an alternative to the tradi-
it
income
is less
costly
and
in
many
potential.
are some things government can do, in Washing-
ton or in each
state, to
entrepreneurs like you
make
the climate
more
attractive for
and your Excel Reps?
Personally, I'd like to see the state
more
the other
believe will continue to gain in
tional start-up business that
cases offers greater
to be in
don't think that's a trend, that's
Network marketing, on
a trend that
popularity, because
I
want
governments become
actively involved in identifying
and regulating
211
Chapter Ten
questionable business practices operating under the guise
of legitimate network marketing companies.
What do you
consider the three or four most important
developments on the horizon in telecommunications, in
business,
and
in society that are really going to shape the
future ofExcel?
First, I believe that
network marketing
to gain in popularity in the business sector as
panies begin to explore
as
it
it
will
more people
grow
and
in the private sector as
leave the confines of corporate
start their
own home-based
with more
flexibility
and
more and
America
to
them
greater income. Consequently,
new home-business owners
tions services.
services.
business, providing
the exciting thing about this trend for Excel
these
many com-
an additional, cost-effective
vehicle for the distribution of their products
Second,
continue
will
will
is
that
all
of
need communica-
By providing competitively
priced bundles
of communications products, including local and longdistance
phone
service,
PCS, Internet
expect our IRs to attract
tomers.
It's
a
win-win
access,
many of them
to
I
as Excel cus-
situation.
Excel was established as a switchless
much
and so on,
success from that approach,
why
reseller.
With
so
are you taking steps
own your own facilities?
We
still
have contracts with
and Frontier
to handle Excel traffic.
tinues to grow, having our
212
WorldCom, MCI, IXC,
As our business con-
own network
adds more
An Interview with Kenny Troutt
which makes
capacity and enables greater cost savings,
more competitive,
Excel
to help us better
meet our cus-
tomers' needs.
In June 1997, Excel entered a definitive agreement to
acquire Telco Communications Group.
sion to acquire Telco
The
mean
to
What
does the deci-
Excel Representatives?
Telco acquisition gives us a competitive edge in
the commercial and international markets even faster
than
we had
originally planned. Telco's
a platform for
these areas,
and
enhanced products and
it
saves us the time
ing from scratch. Strategically,
move
I
network gives us
both
service in
and expense of start-
believe its a
tremendous
for Excel.
Should Excel Reps be concerned that
Telco has
its
own
in-house sales force?
Not
at
all.
Every decision
Excel Communications,
I
Representatives in mind.
I
make
as the
CEO
of
make with our Independent
The
Telco acquisition
exception. Telco's in-house sales force of about
ple will be a valuable resource that will
no
is
300 peo-
complement our
IRs as they approach larger business accounts.
When
can we expect
to see
Excels first moves into foreign
markets? Which markets or regions are you eyeing first?
What
will be the general approach to entering a foreign market?
We
are researching the possibilities right
now and
are
confident that entering the international markets will
213
Chapter Ten
provide a tremendous growth opportunity for Excel and
our IRs.
for
A
number of
multilevel companies have
entered those markets and have been highly successful.
Most
likely,
our
international markets will be
first
Canada, Mexico, United Kingdom, Australia, and
name
Zealand, to
What are
a few.
Excels plans for playing in the local telephone
Can you make
sweepstakes?
New
inroads therey given the intense
competition?
I
hope
mix
uct
—
to introduce local service into the Excel prod-
on
at least
a limited basis
— by
the end of
1997. Its an important part of our strategic plan and one
I
believe will have a
As
far as
tremendous impact on the company.
competition in that marketplace
feel that as
long
as
is
concerned,
I
our Independent Representatives have
an incentive to go back to their existing customers, we
can compete favorably. Those customers already
us. It shouldn't
be a
difficult sale.
Youve spoken about the potential of selling
Where does that stand? Is
nications
electricity
company?
dous opportunities, although
fit
214
we move
it
in that direction.
for Excel, because its another
that
electricity.
a good fit for a commu-
That's an industry that will also offer
before
know
we can
some tremen-
will be several years
I
do think
its a great
consumable product
introduce to our customer base.
An Interview with Kenny Troutt
As you expand and grow
new
directions, will the role
tives
change?
I
the company,
moving
it
into
of the Independent Representa-
don't see their role changing, although they
may
be
even busier. Excel will continue to provide them with
new products and
markets.
They
services they can sell to their
will always
warm
be the driving force behind
our growth and success.
Describe what you would like Excel
to look like in
20 years.
Excel will be a global communications company,
and
offering a large variety of products
services, using in
every country in the world the same marketing concept
we
use today. Excel has changed the lives of
United
in the
States,
and
I
would
like
many
people
all
people
over the
world to have that same opportunity.
In June 1997, Excel
and
Excel
chief operating
and how
named Jack McLaine
officer.
What
as president
does this
mean for
will it impact your role as chief executive
officer?
As president and
COO,
Jack
is
responsible for the
development of finance, technology, and
administrative functions as well as
erations
and
word, Jack
will
strategic
business
all
legal
and
back-office op-
development.
In
a
handle the day-to-day operations of the
company and keep me informed of any
issues that
215
Chapter Ten
require special attention.
the board,
I
will
now
As
CEO
and chairman of
be able to spend more time focus-
ing on the marketing plan and future products
ing even
more opportunities
Representatives.
216
for
—
provid-
our Independent
Conclusion
TEN QUESTIONS FOR YOUR FUTURE
1
Is
your income growing
does
2.
it
as fast as
you'd like and
have the potential to grow in the future?
In the event of retirement, the loss of a job, or
an unexpected catastrophic expense, do you have
enough savings
your current
tain
3.
that
Do you
would permit you
to
main-
lifestyle?
feel that you're in
control of your daily
schedule?
4.
Do you
have enough time to spend with your
spouse and your children?
5.
Will you be content with relying on the govern-
ment
in
Washington, D.C., to take care of you
and provide
for
your needs, or are you the kind
of person
who wants
6.
Have you
ever
7.
Do you
to stand
wanted
on your own?
your
to be
own
boss?
believe that the telecommunications
industry will continue to grow for years to come?
8.
Do you
family
think you
members who,
become your long
if it
saved
they
know
a
few close friends or
if you
distance customers
them money and
made
asked them, would
didn't
—
especially
change the way
their calls?
217
Conclusion
Do
9.
you
others
get personal satisfaction
and from surrounding yourself with
interesting
and
successful people?
Do you strongly believe
10.
from helping
that in
America the
future can always be better than the past for
those willing to
try
work
hard, take a chance,
and
something new?
answered these questions the way most of us
If you've
have and do, then you're ready to
Troutt's "rocket ship to the stars."
jump aboard Kenny
And
in so doing,
you
can promote yourself to the ranks of those visionary
Americans who, rather than being overwhelmed by the
change, help shape
How can
it,
lead
it,
and
ride
such change be defined?
it
into the future.
What
most
are the
important trends for you to watch, manage, and jump in
front of?
o
The
global telecommunications industry, op-
erating in a deregulated environment, will be the
most powerful and
lucrative industry during the
opening decades of the new millennium.
It will
be marked by explosive growth, creating hundreds of new billionaires and tens of thousands
of new millionaires in our
o
The
rise
lifetimes.
of the self-employed will continue,
Americans hasten
their
march away from the
corporate world to start their
218
as
own
businesses.
Conclusion
The
self-employed, already accounting for a
share of population equal to that of the unionized workforce, will constitute a
and
social force in
government
society,
policies that
punish individual
o
our
growing
political
demanding
encourage rather than
initiative.
Network marketing will continue
to gain accep-
tance and potency in the business world and con-
sumer marketplace. Low-cost technology
make
starting these businesses easier than ever
before, with greater
before.
The
odds for success than ever
transformation of network marketing
from a product-based
to a service-based industry
will vastly increase the
and
will
attract droves
growth of the industry
of new practitioners from the
ranks of the most highly skilled professions.
o
The
security once offered
by big government and
big companies will continue to crumble. Faced
with burdens of an aging population, the govern-
ment
will
continue to scale back social safety net
programs, leaving millions of Americans in the
lurch. Intense global competition will force big
companies, even in the face of a booming econ-
omy, to engage
in almost continual
rounds of
downsizing, automation, and mergers
which may be good
spell uncertainty
inability
for the
and
—
all
company but
risk for
employees.
of
will
The
of government and the traditional
219
Conclusion
business world to provide the level of security
and opportunity Americans once enjoyed
many
propel
will
into the ranks of small-business
owners.
A crisis in values—the breakdown of the family,
growing drug use among youth, the decline of
the education system, the threat of violent crime,
the shunning of personal responsibility,
disintegration of community spirit
a powerful political, social,
ment aimed
ment
will
and
and the
—
will unleash
cultural
at restoring those values.
move-
This move-
be based on the reaffirmation of
self-reliance, individual initiative, full-time par-
enting,
many
and educational
to
choice.
It
change careers and rearrange personal
priorities. It will reaffirm the ethic
sionate capitalism in
entrepreneur,
And
who works
risks all, to a place
of a compas-
which people succeed by
helping others succeed.
220
will inspire
it
will return the
hard, dreams big,
and
of high honor in our country.
Index
Adler, Jordan,
Amway,
xvi,
AT&T,xi,
98-99
Casner, Bill and Susan, 3 1
33-34, 46
40
2, 11,
18,31, 106,
148, 194-196,
break-up
of,
Cheatham, Larry and Bonnie,
209
12-15
124
Cross,
Bob and
Linda,
145-146
current market position,
15-17
D
B
Davis,
Beck, Greg and Carolyn,
47-48
Bell,
Randy and
Melissa,
69, 115-118, 130
Dick, Jimmy, 167-168
Alexander Graham, 5-8,
24
Dickson, Don, 145
Direct Selling Assn., 58, 165,
Bowditch, Larry and Lucille,
177
86-89
Brake, Rick and Cindy,
99-100
Eckart, Philip,
breakdown of the American
family,
118-124
economic
160-161
insecurity,
92-97
Edison, Thomas, 8
221
Index
Friedman, Loren and Vicki,
electricity deregulation,
204-206
125-127
Excel Communications, Inc.
accomplishments
Funk, Dave and Ellen,
135-137
of,
186-187
appeal to IRs,
20-22
and the Better Business
Bureau, 171-172
Gergen, John and Alice, 127
Gilmore, Kenny and Linda,
100-101
business strategy of,
17-19
Greene, Harold, 14, 15
customer services and
products, 19-20,
H
189-207
Hallmark, Daryl and Betty,
growth
initial
of,
142-143
4
public offering
Hankins, Vivian, 47-48
(IPO), 22-23,
Head, Ron and Judy, 146-147
25-26
Hillis,
merger with Telco,
Hugh and
Denise,
148-150
xiv-xv,
197,213
Hinson, Beth, 101-102
recognition of top
Hintze, Cindy, 102-103
performers,
68-69
Hintze, Pat, 2, 74, 102-103,
130
"Stairway to Success,"
64-68
Hoover,
Chuck and
Sandra,
85-86
Hundt, Reed, 192-193
Federal
Communications
Commission (FCC),
J
11,12, 13,171,177,
Jennings, David and Karen,
191
222
103-105
Index
network marketing (multi-
Johnson, Kern, 87
Jones,
John and
level
Patrice,
105-106
marketing)
advantages
as
of,
compared
K
58-59
to
pyramid
schemes, 161-163
Kelly-Smith, Meg, 7, 69,
growth
of,
58
Noland, Russ and Mary, 69,
128-130
106-107
Kirkland, Ronny, 147-148,
149
OP
Orberson, Paul, 38, 40, 69,
Lammons, Mike and
69,
75-77, 85, 180
Barbara,
78-83
paging,
Lemons, Lee, 87, 88, 110-111
Parrill,
Lemons, Rhonda, 110-111
189-190
Fred and Charlotte,
31,34,47
Pentecost,
M
Cindy,
130-132
Martignon,
Dan and
Linda,
Phibbs, Glen and Charlene,
34-35
MCI,
Mark and
150-151
2, 13, 18, 148, 166,
Pine, Kevin
108-109
170,212
McLaine, Jack,
41,
xv,
and Doreen,
23-24, 32,
Pospichal, Scott
and Brenda,
83-84
184,215-216
Medicare, 137, 139-140, 141
Mims,
Phil
and Lucie,
132-133
R-S
Rick and Brenda,
Ricketts,
77-78
N
Schulz, Colleen, 74
Ness, Susan, 193
Schulz, Steve, 2, 3, 71, 74
223
Index
Scott,
J.
R. and Betty,
regulation of,
11-17
109-110
world growth
of,
197-202
Shaklee, 17
Smith,
Jay,
128-130
Telephone
Smith, Sarah, 53, 155-157
growth
Smith, Steve,
invention
xv, 24, 32,
41,
63-64, 68, 76, 77,
Thomas,
184
8-11
of,
5-9
of,
Al, 69,
111-114,
185
involvement in Excel,
Thompson, Michael,
107-108
52-53, 55-56,
159-160, 185-186
personal background,
50-52
Torsey,
Bob and
Triplett,
72-74
LaDonna, 143-144
Troutt, Kenny,
xi, xiii, xiv, xv,
4, 23, 24, 25, 26, 68,
Social Security, 137,
138-139, 140, 141
Sprint, 3, 18, 148,
Lois,
166
73, 76, 77, 80, 104,
126, 133, 143, 147,
148, 157, 165, 170,
180, 184, 186, 187,
Telco Communications
Group,
xiv, 4,
23, 32,
196,213
1996, 192-196
Telecommunications Resellers
Assn., 170
Telecommunications
224
of,
42
childhood, 26-28
early business ventures,
28-32
idea for Excel,
32
interview with,
209—216
leadership abilities,
services
for,
206
awards
Telecommunications Act of
demands
188, 189, 196,204,
9-11
45-46
Index
marriage to Lisa Troutt, 36
starting Excel,
32-36
Troutt, Grant Michael,
Troutt, Lisa, 26,
37
207
at Excelebration
w
Walker, Steve and Roberta, 125
Watson, Thomas A.,
Wells, Phillip,
1
996,
24
84-85
wireless phones,
190-192
Witt, Barbara, 151-152
38-39,41
marriage to Kenny, 36-37
Troutt, Preston Allen,
6, 7,
37
Wittmann,
Pete, 28, 29, 30,
31,32,33,35-36
225
Business/Network Marketin
HOW IT HAPPENED, WHERE IT'S
GOING, AND WHY IT MATTERS TO YOU
AT&T telephone monopoly in 1984.
Kenny Troutt knew nothing about telecommunications, but he did know an
L incredible business opportunity when he saw one. Armed with only a dream,
federal court decision toppled the
a
little
money, and a small group of people
Communications,
•
Inc.
The
results h i\e
Excel went public as one
-
,i
who
believed in him, he created Excel
keen phenomenal:
the youngest companies ever listed
on the New York Stock Exchange
achieved $1 billion in sales three times faster than Microsoft
•
It
•
In nine years, sales grew nearly 50 times and reached an astounding
$1.4 billion
•
After the merger with Telco, Excel will have sales exceeding $2 billion
thi has been achieved by a diversified sales force with a
Hundreds of thousands of independent network marketers
promote and expand the company and their ranks are still growing.
Perhaps most amazing of
all,
solid stake in Excels success.
have signed on to
Excel
is
—
currently the fifth largest provider of residential long-distance telephone ser-
A unique combination of technical breakthroughs
and good old American ingenuity, Excels incredibly inspiring story proves that the
vices in terms of presubscribed lines.
American dream
is
alive
and well
—and wide open
to you.
"An important book about an important company. Excel will
long be remembered as one of corporate America's leading
— Richard
Poe,
New
of Wave 3 and Wave 3
Way
to
innovators."
York Times bestselling author
Building Your Downline
Prima Publishing
ISBN D-7bL5-lL71-7
,l
86874"51171»
l
2
9
780761 511717
ll
52000