Robert Herjavec Answers Your Questions and Offers Crucial Advice

hi I'm Maria Aspen and a senior editor at ink magazine welcome to this Facebook live chat with Robert Herjavec who is the founder of the Canadian cybersecurity firm Herjavec group and who is also well known as the nice shark on shark tank which recently finished taping its eighth season we're just we're gonna have a casual conversation please participate write your questions in the comments and I will be reading them to Robert Robert thank you so much for joining us thanks just a quick correction yes it's not a Canadian company now oh really we're a global company we started about two and a half years ago we had one of those moments where we thought we were really big and worth a lot of money and then we realized that the Canadian market is relatively small on a global scale and for us to really realize our value we have to expand so two and a half years ago we did one percent of our sales outside of Canada now it's almost 35 percent we're in the u.s. in the UK Australia so we've learned a lot just like a lot of your readers about expansion I think because we've never done that before I is it correct at about 25 percent of your business is now in the u.s. it's about 22 to 25 percent and the rest in the UK and the remainder in Australia but it's so interesting because if you look at exporting because a lot of small companies don't think about going outside the borders you know you start with one office in your house then you get a real office then you say oh if I had another location in the city and then another state and so on and for us you know especially as Canadians we tend to be a little too nice a time for like we shucks we can't compete with those you know big Americans and those people in England and the key to exporting was simply going out and doing it and once we did it we realize that there's a lot of similarities in our marketing across the globe so who has the worst cyber security problems right now where are you getting the most business it's very interesting so there's there's two elements to it the first one is we used to only sell to a certain vertical large scale financials so our market is very segregated there's people to do the low end of the market and there's people you know I always say you don't want to be the GM of cybersecurity you don't want to be the middle market car you want to be either high end or you want to be low end and so we tend to focus on very large complex companies we only sell to very large enterprises and we're very clear about that but I would say that every company today is a computer company whether you're in mining whether you're in manufacturing you're a computer company if you're a computer company you're online and you have a cyber threat so we're seeing a lot of stuff here obviously in the United States but I would say the number one sector is healthcare we were recently at the Department of Homeland Security who we have a relationship with and I know a lot of people there and we went to see them and they have a group that is supposed to look after infrastructure you would think like utilities nuclear plants and they're spending all their time fighting ransomware at hospitals well I mean cyber security and and hacker attacks have been in the news so much whether it's whether it's the WikiLeaks did you know that the you know but the large cyber breach lies yes yes down Twitter or Amazon for a while did you know one of the reasons that that was so catastrophic was because of the Internet of Things what people don't realize is as you connect everything to the internet from your fridge to your baby monitor all those things can become relay points for a large massive cyber breach an attack and so one of the reasons the attack last week was so bad is they actually used home connected devices to relay in attack stations so what would your advice be to me and to all of our viewers what what step should we take like today to make sure that we're less vulnerable to those attacks get offline and go live in the woods okay no I think that you have to accept that realize that the Internet is obviously as huge benefits for everybody in their lives but just some basic things never open an attachment unless you know who it's from never enter any type of personal information online that is really personal like your PIN number no bank financial institution will ever ask you via email for your PIN number or any element of security never give your mother's maiden name in an email format because again no institution is ever going to do that for you a lot of the websites now have two-factor authentication so that's where like I would need to put in my phone number and get a text message yes so you would go on Amazon has it now and a lot of other sites and you go on and they text you back a code and you have to enter it so that always helps and don't do personal bank related type of stuff in public life I okay public Wi-Fi is public Wi-Fi and so you just have to be careful with it so I would imagine this has been great for business it's been very good for our business you know it's funny because we've been doing the same thing I've been in cybersecurity business for 30 years and I used to be the guy at the back of the party but nobody ever wanted to talk to what do you do I'm in the cybersecurity business what's that oh I work on computers and people like oh I just bought this laptop can you fix it and I can't I only know cybersecurity but the markets kind of caught up to us so this company we've been in business for 12 years and we really feel that the markets caught up to us but you know like a lot of your readers being successful or girl I always think it's 25 things twelve of which you control thirteen which have no control over but you have to be smart enough to realize they're happening and try to leverage them and take advantage of it could you take us back to some point in those past twelve years where things were not looking as good where you didn't know how you're going to go forward like how did you continue grinding it out and find the motivation to stay in business oh gosh you know like like every business every all my friends who've never started a business always look back and go wow you're so lucky you started this company and you did four hundred thousand sales the first year and you're into 160 million this year you're so lucky but and they think it's always this linear growth curve anybody online right now knows that's run of business it's it's like this and then like this and then like this and then like this and so it's different plateaus and I think every business reaches a plateau where it faces a crunch on whether it's going to grow or not and it's about going through those plateaus and we we've had them all in our first year we thought we would do five million in sales because we're great at what we do and so we thought we're great about what we do people will love us how could they not buy from us we did four hundred thousand and we learned a very valuable lesson we went to see all our customers and we said you know we're back in business we had another company before but we've been out of business for three years and what we learned was nobody leaves good enough for potentially better so customers were saying to us we love you you're great we know your engineers are incredible but if our existing supplier the incumbent messes up we'll call you and I was like oh my gosh we're like a retail business we're sitting around you never want your strategy to be based on the other guy screwing up you want your strategy to be based on value that you can add so we had to retool and you know it was it was really tough it took us five years to get to 6.2 million in sales in the next five we get to 160 million and our target next year will be 200 million so how did you change people's minds how did you make make them come back to you rather than waiting for the other guy to screw up we abandoned what we were selling we originally started selling managed security and adding a lot of value but we realized was we had been out of the business and the market was immature so we wanted to sell this but you have to listen to your customers our customers were saying to us yeah we'll buy that stuff one day but here's what we're buying today and so we went right back to the drawing board we started selling anti-spam software which was wasn't really considered a security thing it was about as low tech in our business as you can get and nobody really wanted to do it we really kind of felt like why do we start the company to sell this but it was necessary you know the best way to get a customer is to sell them something and the best way to upsell somebody is to have a customer and so we can we kind of got our heads around which was really hard you know it's really hard to be the big guy and sell something really valuable and then just sell this but it was a great way to get customers I wondered if we could go back to the beginning and your background you have a liberal arts degree I do did it prove what did it do to prepare you for your business today yeah it's funny I I went to university and I didn't have a lot of money so in the last year of high school there was a contest and I was living in Canada at the time so Ontario ran a contest the problems I was living in and you wrote this accounting test and I came third in the entire province out of tens of thousands of kids and they gave me $5,000 to go to university and so $5,000 to my family was like all the money in the world and I studied business and accounting and after six months I was so bored out of my mind quit and I was actually going to drop out of university and I went home and my dad sees me at home in the middle of the day and he's like what you doing home and I'm like ah University it's not for me I'm gonna get a real job and he looks at me and he comes up to me literally like this far away from my face and says look I love you you go back to school or I kill you very body backyard nobody find and I really thought he meant it so I was I was the first person in my family and his family and my mother's family that had ever gone to post-secondary education so for me getting a university degree I didn't care he did and so I went back and I hung out on campus for about three days and one of my best friends at the time she was getting a liberal arts degree and I said what how does that work what are you what your degree and she goes classical English literature so how does that work she goes you get a book on a Monday you read it like a Dickens eight hundred page book and Friday you show up and you argue about it I'm like always there like a test just know it's completely your opinion there's no right or wrong but like what sign me up for that and so that's why I went to classical English literature and that's my degree and I went into it because I love to read and I thought this is easy but I actually learned a lot because when you when you read an 800-page book that's a really complicated and Old English Dickens type of literature you have to take those concepts and explain it to a bunch of other people so it gave me the ability to take in a lot of information and boil it down to something and be able to explain it to others in layman language so is there any one right way to get educated before you start a business I mean there there are all these different schools of thought that you shouldn't go to college at all - you should go to business school there's no one right way but there's a couple of wrong ways that if you're a college student watching you shouldn't do number one is don't go into massive debt to get a post-secondary education you you will regret it and it will be really hard number two is definitely get a post-secondary education everybody is getting a post-secondary education today if you don't have one you stand out so if I get a hundred resumes today and two don't have a post-secondary education degree I don't look at those and three nobody cares about your degree after your first job nobody I mean nobody three years into your job no one's gonna say where'd you go to school and what was your degree in and what marks did you get nobody cares get a degree don't go into massive debt and get a job with real experience experience is far more valuable but a degree will will serve you well and for people who can't afford the degree especially not without going into massive debt everybody can afford a degree that that's the big not you don't need to go to Stanford you don't need to go to Harvard you don't need to go to Columbia it is not a god-given right to go to an Ivy League school and yes it probably means your starting salary will be lower but if you look at your life five years out the people that make a lot of money aren't the ones that have fancy degrees they're the ones that add value so you look at shark tank there's six sharks none of us went to a fancy post-secondary degree half of us I think we all have a degree barely passed it's it's never affected me but you should have thanked everyone well we actually have a reader question from Craig Mulaney who asks what we're quite broke Craig does not say that they every year from you mentioned secondary degrees what are the other most important lessons you've learned about hiring and retaining great talent the number one thing I've learned is you can't build scale without employees / team members / Talent it is impossible to make a great deal of money and build tremendous value without a great team so as a and and that's a transition that every founder needs to make when you when I started the business my number one job was to be the best sales guy and I was and then when we ran out of cash on one point my number one job was to be the CFO but as you as the company gets bigger your number one job has to be to inspire and retain people and it's just a constant you just you just got to keep doing it all the time related to that we've we've got a question that came in before before this started from Elizabeth Maxwell she also did not say where she is from how can I best help small businesses survive in my community is it funding or information or access to resources or something else well the number one way you can help small business is to actually support small business so we did a recently a program with a company called Deluxe called the small business revolution and we had over 200,000 people from across the United States nominated a town and we went to this small town and gave them half a million dollars to help them out it was really fascinating what we learned is a lot of people don't bother to frequent the small businesses in their community and if you think about a communities are made up of connections the very definition of a community is people that are interconnected so I always say to people you know go to the local hardware store go to your local driking cleaner go to your local coffee shop like you guys all do here for the $3.00 coffees downstairs but you have to support the local small businesses excellent Elissa dorsa wants to know how do you balance work life and personal life and I would imagine that's especially difficult when you're on TV as well it's really hard it's it's really hard it's easier you know the one thing about becoming more quote/unquote success when having a bigger business is you know you can fly better you can stay in nicer places you can bring your family along with you so make some of that easier but it's it's never easy if if you want to start a business and have a really great balance you probably shouldn't start a business Mark Cuban has a really blunt way of saying it when he started his first business he had a girlfriend at the time and she came home one day and she said you know mark you're working a lot it's really affecting our relationship you've got to make a decision it's either the business or it's me and mark looked at her and said what's your name again and you know he's joking maybe but it's really hard you know the business anybody who started a company and seen it grow and seen it start to succeed realizes it becomes a living breathing entity and it takes on a persona and a life of its own and it doesn't care about you it when it's like a baby when it wants to eat you got to feed it when it needs more cash it needs more cash there are no holidays there are no weekends there is nothing when you run a business like that it's really hard well if you wouldn't mind me asking about your personal life you recently got married and I wondered how did you and your now wife approach those sorts of discussions about how you're going to balance your business obligations with your personal obligations yeah you know for me it's a little easier because you know I get to travel better and I get to go back home so you know we have a home base and I was sure to be home on weekends and I always tried to bring people along and just make it more fun but it's also important to have somebody who understands that and is going to be supportive of that you know my wife is on a TV show and part of her job is she goes away for three months to another country and so you know it's give and take she supports me but I support her too Kristi Burton well actually I'm going to following up on that I'm going to go with a different Christy Christy Alexson asks what are some daily practices you do for self-care so to keep to take care of yourself in your personal life I like to work out everyday I I'm not right now and but if I don't work out I know I didn't so that that's you know it's like they always say the key to any problem is to recognize you have a problem so I'm so in tune with that if I don't work out today I'll feel it no know it and for me it's just it's just a matter of stress like I I love to run and a lot to do a lot of cardio and it just really focuses me and Tunes me out I think one of the reasons I've been able to survive under a massive amount of stress is I'm pretty good at knowing when my body needs something I know when I need more sleep I know when I need to exercise I know I never have too much coffee like it I just have that God feel and that's you know you've got to listen to your body because if you're not healthy and driven and motivated it you're not gonna survive do you usually work out first thing in the day or how do you fit that into your schedule so every night when I go to sleep my plan is to work out first thing in the morning I get up pretty early like 5:00 5:30 and so my plan every night is I'm gonna wake up early and go to the gym and then wake up early and I get so excited about getting on an email and talking to people that I don't I try to workout at night okay yeah okay well Christy Burton I you know faked you out so I will ask her question which is what is the one factor that motivated you in the beginning when starting your business money you know I hate to sound like mr. wonderful Kevin but I only started my I never want to start a company and there's two types of entrepreneurs there are those who were born and and those that are made and I was definitely a made one I never wanted to start my own business my dream in life was to make a thousand dollars for my age so if by the time I was 50 I was making 50,000 a year had a house that I was on my way to paying off one day and a used Corvette baby that was like I could see it that was my dream and then a guy fired me and I didn't know what to do I couldn't get a job quickly enough to pay my mortgage and so I started just selling stuff and people bought it I sold a little more stuff and then I actually got a job and kept the job and selling stuff for about three months until I couldn't do both and it's funny I'll never forget my mom said to me one day when I finally decided not to get a job and stay with the company she said oh don't worry you get job one day so but but that was my background you know my background is we didn't know anybody who started a business we we thought success was having a job seniority and working your way up 85% of all entrepreneurs have a family member one or two who start a business the problem in America today is not the divide is not between the rich and the poor the divide is between people that know how things work and people that don't you know when I was 18 I wanted to start a business so I sat down with my dad yes I want to start a business so my dad brings in the most successful guy we knew this guy sits the anistar ask him questions he's never started a business doesn't know anything about a business and he leaves so I go to my dad I go why why am I talking to him and my dad tells me he's got more seniority in the Union than anybody he knows so if there was a layoff at the factory his friend was gonna get laid off and that was success and so it's hard when you don't have that experience around you what would your advice be to people today do you think that you could still start a business and get the money immediately or how how would you what would your advice be to somebody looking to sustain themselves while trying to get a business off the ground yeah I don't think there's anything wrong with having a job and starting a business I also don't think you should take investment or equity upfront which is weird right Diana showed that we buy people's business and invest but you know when you're an entrepreneur and you start your business you're only pay back is your equity and you want to hang on to as much equity as long as you can because when you give it up and you sell it you're probably gonna have to do it again and so you want to hang on to it as long as you can which leads me to ask so when would you recommend going on Shark Tank when's the best time to try to get on the program it's really funny our show is you know we have all these statistics 52,000 people applied to be on our show last year and 235 were brought to and now 235 we see 185 or so because there's no script there's no time we just talk and the longest pitch was two and a half hours Wow and the shortest was 20 minutes in the longest pitch demon got up went to the cafeteria had lunch came back the guy was still pitching and he didn't cut him off we never we the producers want to cut people off okay but it's very real when people come through that door we don't know they're Nino nothing about them we have no background on the business and it's our money so if we want to ask them a million questions we're gonna ask a million questions we don't really care about the making of the TV part we we really want to learn the businesses and so it's it's hard when you come out like that but the thing you notice is consistently if you can't engage us upfront we don't care we're tired we're hungry were bored because and we're always thinking about our other businesses and so people that come out and can engage us and tell a great story right away they get lost pretty quickly we have had a couple of questions from Angelita bird in Philadelphia and she's asking basically about the meaning of success for you what is enough well those are two different questions and their success from when is it enough I think anybody driven by that concept of getting stuff is almost doomed to live a shallow experience because you know if you want the most amount of money there's always somebody who has more money than you so I think I never think of it isn't enough and but but I didn't do it I did to make money but very quickly willing to build a great business and so we don't do it to make more money we do it to do something great and we feel like we have a mission and we feel like we really want to help the world we feel that cybersecurity is affecting a lot of great companies and we feel like we're protecting them and we're very passionate about that you have to make money to survive and so that's necessary I think the measure of success is different for everybody how do you define it you know I think for me it's it's being healthy you know having a family having a balance to my definition of it having a great team of people and have a creating an environment where people can succeed in their own terms we have a question from Bulgaria Bulgaria Bulgaria IVA velizar velchev ah and forgive me if I'm mispronouncing that name what type of financing would you recommend for growing a start-up which already has a positive cash flow well my question is why do you need financing people think you need people tend to take money in too early if you have positive cash flow then why do you need funding do you need to have staff you need for inventory so I can't answer that until I would know what the money is for all right well even if you're watching tell us in the comments and we'll come back to that and then we have Anna panel what is the best investment you've made in myself okay by far the biggest investment unless you come from wealth unless you have a fancy degree from a fancy University unless your parents are going to help you every step along the way the biggest investment you'll ever make in life is in yourself you would be shocked how many people stopped learning they know they don't go on training courses unless their employer pays for it they don't go to seminars unless somebody is sending them and so keep investing in yourself keep reading keep learning learn a skill on the side do anything because that's the stuff that matters in life well related to your background we've got a question from Derrick McConnell who asks about your history as an immigrant from your family came over from Croatia when you were 8 and then you became a Canadian what's been the most memorable part of the journey you know that the journey itself I think I'm really proud of my parents that they came here they made that decision to leave obviously was really good for me and I think you know I think it takes a tremendous my dad was 37 years old didn't speak the language basically escaped from a communist country to bring my mom and dad and me to Canada on a boat with one suitcase I can't even comprehend that and I've done a lot of stuff and it seemed hard at the time and people say oh how do you do it it's so hard in the back of my mind I always think nothing I will ever do in my life will be as hard as what my my dad did by coming here it's and and this is the great thing about America you know we wanted to come to America but America wouldn't take us and so we went to Canada in Canada and America you know we are built by that dream we are built by people who have a fundamental belief their life will be better tomorrow than it is today we are built and we are a nation of people that want to create greatness and I mean for me that's what I remember I remember that my parents always instilled in me we gave everything up for you but not in a mean overbearing way for you to have an opera make the most of it and and it's I see a lot of young people today who don't do that and you know it is it is the best time in history to start a business Oh could I ask about your thoughts on all of the anti-immigrant rhetoric we've been hearing in this country recently especially around the election do you have any any thoughts on how we can return to that to that promise that you talked about well I think the promise is alive and well outside of America I think if you go around the world we are the land of opportunity for the rest of the world this is the greatest country in the world to build and start a business and we are still the bastion of hope for many people I mean this is the this is the land of dreams with in the United States the challenges there's a lot of people who feel disenfranchised and they feel that they're lost and so the challenge is to give opportunity to everybody and I think you know the political rhetoric is just rhetoric no one's going to build a wall no one's going to stop the borders because without immigration we will stop to grow so I I just see it as rhetoric we have a question from Vera's Dean Croatia that's where I was born uh Gore a fruit for John forgive me Igor again is asking when you will visit your hometown I was just there about nine months ago it's a beautiful town so virus Dean okay call thank you that's okay it's the only place in the world where I don't have to spell hurt you back and there's more of other herds of Acts than there is of me you know besides my kids I'm the only Herjavec in North America my my dad was the youngest of 15 and he so imagine this he's the youngest of 15 and his dad died while if his mother was carrying him he got run over by a train oh god I mean how the hell a tramatic is that not to laugh about it but imagine being the youngest of 15 with that background in absolute sheer poverty he was the toughest guy in the world like you could not complain to my I mean you come home with like your arm broke into my dad be like ah it's nothing don't complain but it's a beautiful town and so all of his brothers and sisters stayed in that town and you know they're there they all have cousins and all kinds of stuff I love it there how often do you go back I tried to go back once a year we had an office there a number of years ago funny about how cyber Security's change we have a development office in Zagreb which is a bigger town but a lot of our customers it's about three four years ago a lot of our customers would say to us oh you have an office in Eastern Europe that makes us nervous because you know those are the people that are hacking us we were like no no it's other people hacking you today most big companies it is so hard to hire talent in our space that you can have that ads you need to go where the people are and Eastern Europe has a lot of talent and we're actually expanding out to India to get engineering talent now we have a question from Lee band Oni would you ask for increased equity on the show due to the shark tank effect for example or ie two identical investments but one done behind the scenes and one done on screen so I used to be a computer geeky kind of guy and not a TV guy and I used to believe that if you're great at something the world will find you I used to believe that if you invent a better mousetrap and you keep making it great the world will beat a path to your door and what I've learned is that is absolutely not true you know there is no such thing as genius in the darkness of a basement genius only exists because somebody found it you have to tell the world you know Microsoft and I have the best operating system they have the best marketing plan at the beginning so unless you go out and tell the world about who you are it's going to be very difficult to be successful and so absolutely there's a premium for being on shark tank because it gives you incredible exposure think of it this way a 30-second commercial slot during Shark Tank is about two hundred and thirty five thousand dollars per 30-second saw a slot you're getting a lot of free PR again though it's just PR you got to do something with it well in we have a couple of questions including from jerel Gresham about social media and marketing and just how do you what are your tips for getting the most out of that and getting your name out there if you're not on shark tank yeah we've in the last two seasons we've really seen a lot of people I just made an investment it has an error so I can't tell you about it but it's it's these three kids and they invented a beach towel which no big deal but they started marketing it and started creating a community around this towel and they encouraged so you would buy a towel mhm and they'd encourage you to take a picture with the towel and you know in a cool setting so a lot of kids would buy and take a picture at their dorm and that kind of stuff anyway this thing just started to build momentum because everybody who used that became an ambassador for the product long story made short they do two million dollars a year now lunches I'm unbelievable just met with them and amazes me but that is the power of social media today is if it's working you can really leverage scale but social media is not an end it is simply a leverage point to get you somewhere you first have to find something that's working and and whether it's your product whether it's your service it's just a way to get it out there faster we also have a couple of questions about hiring and partnerships Caio Abreu and Brazil wants to know what is your advice to build a great team Brazil is a beautiful country by the way I had a race at the Formula One circuit there which is incredible and I crashed into a wall end up in the hospital called the Albert Einstein Hospital freaked me right out and Brazilians love car racing it was incredible I was in Sao Paulo so how did brick build a great leadership team it starts with the leader and it's a bit of a cliche but you know the pace of the pack is really determined by the leader I never expect anybody to do something that I'm not willing to do ever now that's hard because you actually have to do it and sometimes you have to be not so nice about it so the upside of that is we have a very encouraging environment because we really want you to get ahead we want you to do your best and we want you to work really hard and you'll never be asked to do something that I'm not willing to do the flip side is if you're not willing to do it you probably shouldn't be on our team so you know part of that is also discipline to make sure not everybody's going to fit on your team and you got to cut those people out when they don't fit that's excellent we have another question for advice from Srinivasan in Srinivasan India what advice would you give to young leaders what other advice you know that's such a general question my advice would be stop asking so general questions you know and along that line seriously people tend to think too wide you know when people are starting out they think they tend to think too I I got a job in the computer business when I was 21 years old and I changed jobs often but I never changed careers so when I turned 30 I have been in the computer business for 10 years which is an eternity biggest mistake young people make as they think of this the world in macro systems but but the world doesn't pay you no one's going to pay you millions of dollars for general knowledge general knowledge is only good on jeopardy or wheel of fortune if you want to make a lot of money and be great at something you have to have a very narrow niche of knowledge I'm one of the top people in the world at cybersecurity I've been doing it for a long time I'm very comfortable in that knowledge I if if your phone broke right now and you ask me how do I reboot it I would have no idea and you know what I don't care I know a little bit about other things but I'm very good at one thing so that's my advice is pick a field stay with it and become great at one thing that's something well we have to wrap up and I think that's a great place to leave that Robert thank you thank you so much this is wondering for having me thank you

Channel: Inc.

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Rating: 4.8607593 out of 5

Keywords: Inc. (Magazine), Inc.com, Small Business, Entrepreneurship, Business, News, Entrepreneur (Profession), Startup, Leadership, Robert Herjavec, Shark Tank, Maria Aspen, business advice, advice for success, business success, business school, degree advice, business tips, start ups, growing companies, work ethic, successful people, facebook live

Id: ULwQ5DaII2I

Length: 42min 0sec (2520 seconds)

Published: Fri Jan 19 2018