You might be asking yourself: “who are the St. Joseph Royals?” And with good reason: 1.) Because the St. Joseph Royals don’t exist, and 2.) The reason they don’t exist would have precluded the town from making the changes necessary to evolve and actually pull off the 4-games-to-1 victory over the New York Mets in the World Series.
Did I lose you? OK, allow me to explain. There is a career and business lesson in the tale of St. Joseph, Missouri—and the baseball team that never was—and it doesn’t specifically relate to baseball, but it is about teamwork, timing, and adaptation, all integral components to any successful business or career.
Odds are you have never heard of St. Joseph, Missouri because it’s been overshadowed by its much more famous neighbor to the south: Kansas City, Missouri. But there was a time when St. Joseph was the preeminent city—the better known of the two and the more economically established. So what happened?
St. Joseph ignored its opportunity to grow, satisfied with the status quo.
Growth happens in stages—whether it’s personal, business, or the growth of a municipality. And the behaviors that bring us into the arrival of one stage of growth are often the behaviors that evolve or are replaced in order for you to get to the next phase. This is an important concept for both businesses and individuals to understand with respect to shaping a company’s trajectory or your own career opportunities.
The first phase is the “Entrepreneurial Concept Phase” and is typically characterized by strong founder involvement in all of the important decisions or centralized decision-making. Companies are typically in the $0 to $10-15M range in terms of revenue, and they are likely losing money (if focused on rapid growth) or generating very little profit. The culture is driven by entrepreneurship, not leadership (and those things are different). The general mentality is to do anything and everything it takes to demonstrate product efficacy, satisfy customers, and achieve sustainability. But…most companies and concepts die during this phase.
We Can Scale This Thing
An even more astounding number of companies die coming out of this phase and entering into the next phase: the “We Can Scale This Thing Phase.” Companies in this phase are typically characterized by $10-15M to $25-30M in revenue, and they are beginning to show the profitability leverage of their business but might still choose to invest in accelerating growth. They are beginning the transition from entrepreneurship to leadership—pushing decision making down to departments and departmental leadership—and they are often more focused on “why” something happened, rather than the fact that it simply “happened.” This is so they can create repeatable, scalable processes as opposed to “one-off” or non-repeatable situations.
The companies that die transitioning from the “Entrepreneurial Concept Phase” to the “We Can Scale This Thing Phase” are what most authors or business schools would refer to as the “Founder’s Trap”: they never decentralize decision making and achieve repeatable, understandable processes.
Holy $#*!, Growth Is Fun
When companies transition out of the second phase, they are on course to arrive in the “Holy $#*!, Growth is Fun Phase.” This phase is marked by revenues in the $25-30M to $75-100M range, a strong demonstration of unit level economics, and the transition from leadership-driven decision making to culture-driven decision making. (We’ll talk more about this in a future post, but if your culture is not intact, this phase can kill you.) This phase is all about maximizing efficiency into scalable, repeatable processes and a primary focus on repeating the “known” factors that lead to good business and client outcomes while eliminating any spend or energy focused on “unknown” factors.
Companies that are in this “Growth is Fun Phase” will likely look to augment their organic growth with inorganic growth, and very few companies make it through this phase without some significant financial partnerships. There are phases beyond these three, of course, but I’ll stop here for now.
The behaviors of companies as they transition from one phase into another can change significantly. And, it can be confusing to individual team members because the exact behaviors that were right for one phase are no longer the right behaviors for the next phase. Therefore it becomes paramount for organizations—and individual team members within that organization—to communicate about the phase that they are in and the behaviors that might change as they look to grow into the next phase. Otherwise, it can be very frustrating to team members…I know, I’ve screwed this up before.
The Bottom Line
So what does all of this have to do with the Royals and St. Joseph and Kansas City? The reality is St. Joseph got everything wrong and paid no mind to these phases of growth I’ve just shared with you. There was a time when nobody would have thought of heading west without first circling through St. Joseph, but the city did not capitalize on an opportunity for new ideas, scalability, and ultimately growth…and, of course, a professional baseball team.
St. Joseph was the home to the Pony Express; Jesse James walked the town’s streets, and every major push to the West started in St. Joseph. But along came some fellas talking about building a railway, a new way of getting people, information, and goods to the West, and it seemed too far-flung, maybe even crazy—so St. Joseph wasn’t interested.
This decision changed the city’s course in history. They had conquered their phase and were confident that evolution wasn’t necessary to drive further growth, so they told the railway men to head somewhere else. And, they did. Those railway men went south to a little cow town that was barely known at the time. It was a town called Kansas City.
Looking to accelerate out of the phase they were in and find a catalyst to grow into the next phase and others, Kansas City challenged that perhaps their decision making of the day would not be the right decision making for the phases of the future. So they embraced the railway men. The rest is, as they say, history. Kansas City, of course, has continued to evolve and grow as a prominent city ever since.
That’s why they have the World Series-winning Royals, and St. Joseph does not.
A picture of my parents with Drew Butera of the Kansas City Royals the day after the victory parade on a flight. Note my mom’s Royals Championship T-shirt under her blouse.
A picture of St. Joseph, MO in 1868 that hangs on my office wall as a constant reminder of this principle.