COLLEGE PARK – John M. LaPides has made a life out of turning good ideas into profit.
After more than 35 years of business experience, LaPides, 50, says he hopes to pass his skills on to the rising generation of businessmen and women.
The former company president and CEO turns his attention to fledgling entrepreneurs at the University of Maryland in early October. Many are armed with nothing more than high hopes and a printout of their business idea.
“I’ll be with you in just a few minutes,” he tells a line of four students participating in the Pitch Dingman Competition, a program of the Dingman Center for Entrepreneurship at the Robert H. Smith School of Business.
As an entrepreneur in residence, LaPides is often the first to evaluate student business ideas, playing both hitter and catcher in a game of business baseball.
Graduate and undergraduate students from all academic backgrounds pitch their ideas to him in 10- to 15-minute sessions on the first three Fridays of each month. He is joined by investors, center faculty and often fellow entrepreneurs in residence.
Students aren’t expected to enter the beginning stages of the competition with much more than a good idea and a passion for enterprise.
If LaPides likes an idea, he has the resources and the experience to help that idea become a home run. If the idea shows early shortcomings, he offers an honest evaluation and encourages the student to pitch again.
After a business idea is elevated to meet center requirements, the student may present the idea to a panel of judges for cash prizes in more a formal monthly competition.
Participating in a young entrepreneur’s journey is LaPides’ favorite aspect of his work at the center. An unpaid volunteer, he has devoted countless hours since he first got involved in 2001, and is the longest participating entrepreneur in residence at the center.
“It’s the quality of the students and getting these businesses launched. It’s a great thing to see,” he says, glancing at an apprehensive-looking student waiting for his turn to pitch. “It keeps me coming back.”
It’s a common misconception, LaPides says, that he graduated from the University of Maryland and that he holds an MBA. When students ask about his education, he often responds simply that he started his business career “very, very early.”
At age 21 he pushed aside his economics studies at Washington College on Maryland’s Eastern Shore to immerse himself in the family business, Snow Valley Inc., a bottled water cooler plant and delivery company based in Upper Marlboro. LaPides worked there on weekends, summers and holidays since he was 14.
LaPides’ father anticipated a quick and lucrative sale of the business. But before it could be sold, profits had to rise.
At first, LaPides saw his time at the company as nothing more than routine, temporary deal-sweetening. But he later realized that he identified much more with the day-to-day responsibilities of a businessman than with a student’s preparatory life.
The company flourished, and six years later, LaPides still hadn’t sold it. Instead, he bought out his family and became sole president of the rapidly expanding company. By the year 2000, he had expanded its customer base from 600 to more than 20,000. LaPides was selling water from Toronto, Canada, to San Juan, Puerto Rico.
“There isn’t this glamorous meteoric rise of an overnight sensation,” says LaPides, sitting in a lab area of the center, which doubles as an incubator for student entrepreneurs. “It’s a long process done differently than most people would do it today.”
“I didn’t take anyone else’s money,” he says. “I bootstrapped the business and kept building it.”
This prevented investors from bothering him, LaPides says with a laugh.
His secrets to success were simple. He claims that 95 percent of the decisions he made at the company could have been made by anyone. It was that 5 percent that set him apart, he says.
The basics of his business philosophy are summed up by four maxims:
* Be committed to quality;
* Do what you promise;
* Care for your customers, and
* Always present a professional image.
“I didn’t waiver from those philosophies,” he says. “Right or wrong, they were solid, and they remained the same, and I allowed everything to be built on them, like a foundation.”
He encourages students to follow his example by developing core value systems.
“A lot of companies go on without that foundation, and they get lost. They get pulled around by the wind and when it comes time to make a crucial decision, they don’t know why they’re making that decision in the first place,” says LaPides.
In the early ’90s, he decided to try his hand at other business pursuits.
He started a landscape business. The business still involved marketing to homes and offices, the service was simply more contingent on the weather.
LaPides describes his business model as a unique roll-up strategy. He would drive around on a hot July afternoon and look for one-man landscaping operations trying to fix their own equipment so they could finish their jobs. He would buy their businesses, supply them with new lawnmowers and keep a percentage of their hourly wages. Sometimes he would just buy all of a landscaping business’ clients for a flat $1,000.
The landscaping business wasn’t his greatest accomplishment, he says, but it was good enough for the time. He eventually sold it, leaving his hunger for entrepreneurship still unsatisfied.
He soon found himself sitting in a bottled water trade association meeting discussing the high cost of long-distance travel for business meetings. He realized that if he and his fellow bottled water businessmen created their own travel agency, they could earn a 10 percent commission on plane tickets and hotel reservations.
They immediately hired two workers for their new business, and they all began carrying travel agent identification cards. First-class flights and premium hotel rooms were no longer a self-indulgent splurge. They were standard accommodations. They lost those commissions with the Internet boom at the end of the ’90s.
“There are things you can control, and things you can’t control,” he says. “I finally got to that point when I realized that there so many things I couldn’t control, and that’s when I started to worry.”
His ability to run head first into risk and devote all of his energy to a project was waning as his obligations as a husband and father to a son and a daughter increased. Eating dinner with them every night, taking his children to doctors’ appointments and Cub Scout meetings, had become his priority.
It was at one of those Cub Scout meetings, after he and his partners decided to close the travel agency, that he sold the landscape business to another man involved in his son’s pack.
By late 2000, with both the travel agency and the landscaping business behind him and Snow Valley in stable growth, he became an investor, a reasonable alternative, he thought, to the stress and time requirements of traditional entrepreneurship.
He invested in the early stages of InPhonic Inc., the first company to sell cellular phones from a variety of carriers on the Internet. The company went public in 2004 and became the largest retailer of cell phones in the country. The company survives today as Wirefly.com.
In 2001, he felt drawn toward volunteer work. He began mentoring students at the center as an entrepreneur in residence. In fall 2005, when Asher Epstein, managing director of the center, created the pitching competition, LaPides was eager to participate, Epstein said.
One obligation still nagged at him, however: the bottled water business.
That industry was changing rapidly. More offices and homes were purchasing water-cooler machines and bottled water at chain stores. These bottles were cheaper and made in China. He competed by offering water and coffee packages, but after decades of working in tune with market signals, he knew it was time to exit the industry.
In 2008, he finished the job he intended to complete nearly 30 years earlier and sold the company.
“I felt an incredible sense of loss,” he says.
He found relief and purpose, he says, through increasing his volunteer work at the center. During his eight-year tenure he has personally mentored more than 500 students and helped launch dozens of businesses.
When Amanda Nachman, an English major in her senior year in 2007, first pitched her idea for a magazine specifically targeting college students, LaPides immediately got involved. He taught her to negotiate with advertisers and manage costs. He told her to make it happen.
By the year’s end, she had become founder and publisher of College Media Group, and thousands of issues of College Magazine had been distributed to area colleges. In February 2009 she competed and won a $15,000 cash prize from the center in its annual competition.
Nachman, now 24, said LaPides attended her first photo shoot. She had never directed a photo shoot before and appreciated the support.
“He came just because he wanted to, because he had never been to one before,” Nachman says.
Epstein calls LaPides one of the center’s greatest resources.
“His work here has been tremendously valuable to the community. It’s really quite a benefit to have someone with his experience dedicating so much of his time to nurturing the next generation of entrepreneurs,” he says.
At the end of October, LaPides attends the monthly competition where students present their ideas to a panel of judges. He stands on the sidelines watching student presenters answer tough questions from accomplished CEOs, investors and consultants.
“They did an incredible job,” he says. “They pitch better than most professionals, and I should know.”