Surviving a crummy time to be a start-up
You did your homework, and you combined
your vision of a better life for your
family with a detailed business plan.
You devoted three years to setting up
your move. You even accounted for the
weakness you saw beginning to develop in
You sold the house.You moved the family.
You opened shop.
The dot-com meltdown of which you
saw hints developed into a full-scale rout of
the industry. You didn’t foresee the events
of Sept. 11 who did? and you didn’t
foresee the boardroom scandals of the summer
of 2002 or the stock market swoon.
So how’s it going?
If you’re Dan Kahl, it’s been a highly
instructive 16 months, one whose lessons
are likely to stick with the 40-year-old
entrepreneur the rest of his business life.
Kahl and his wife, Suzy, opened Kahl
Commercial Interiors in Reno in May
2001 just in time to catch just about
everything the economy could dish out.
They reflected a few days ago on the lessons
Lesson No. 1:Watch your costs.
“It’s teaching us to be very lean in our
operation,” said Dan Kahl. “It’s almost like
growing up in the Depression.”
Lesson No. 2: Maintain your relationships
Kahl distributes office systems made by
Teknion, but the collapse of dot-com companies
dumped untold numbers of used
desks, chairs, file cabinets and the like on
the regional market.
Kahl brokered a little of the used equipment,
but decided his loyalties needed to be
with Teknion. The manufacturer began
cutting its prices to meet the competitive
threat of used equipment, and its dealers
such as Kahl took smaller margins. The
combined effort helped dealers and manufacturers
alike weather the storm.
Lesson No. 3: Don’t count on making
your revenue targets when the economy
In its first year, Kahl Commercial
Interiors Inc. posted 80 percent of the revenue
it targeted in its business plan, but still
managed to scrape out a profit. The average
order handled by the company was smaller
than Kahl projected, and the company
needed to handle far more orders than
And that brought Kahl to Lesson No. 4:
Be ready to think very hard before you hire
anyone. Suzy Kahl expected she’d be working
from home, keeping an eye on the couple’s
four children as she handled financial
matters. Instead, she’s working long hours
at the office and that meant a stressful
period of making sure the children were
well cared-for while she was working.
The company now employs four, and
Dan Kahl said the decision to add an
employee was among the most difficult
While an employee adds costs, Kahl
Commercial Interiors’ business model calls
for extensive customer service lots of
communication about every detail, for
instance that requires adequate staff.
The company doesn’t have a sales staff.
Instead, its principals each follow their
projects through from start to finish.
And those staff members aren’t just taking
orders from the customer to be placed
with the manufacturer. Kahl said they usually
are working closely with the customer’s
architect or interior decorator, or even
occasionally hiring a space-planner on
While Kahl may be chief executive officer,
his title also carries the phrase “project
manager.” Ditto for his wife, the chief
financial officer. And ditto for Gabrielle
LaPointe, the employee the couple hired as
The term “showroom manager,” however,
is something of a misnomer. In his
desire to control fixed cost, Kahl hasn’t
invested much in a fancy showroom.
Instead, the company’s office is dominated
by suppliers’ catalogs.
“You really have to watch your fixed
costs,” he said.
The lessons of the last 16 months come
after the Kahls made a move they’d
planned for three years. They wanted to
leave their former home in Lafayette in
California’s East Bay region, largely
because they wanted to raise their four
young children in northern Nevada.
Dan Kahl, then in his late 30s, was
experienced in office interiors and carefully
crafted a business plan. The couple used
the profit from selling their house in
California as well as some personal savings
to launch the business in Reno.
In their first months in business, the
couple won contracts from organizations
such as National Judicial College, Krump
Construction and Great Basin Internet
Despite the challenges, the couple continues
to draw inspiration from the
thought that the business and their relocation
to Reno was the right thing for
“We want to buildi something to leave
to our kids,” said Suzy Kahl.
“The thing that I like most about entrepreneurship is I can work toward something that I’m passionate about and be at the forefront of the change that I want to see happen,” said Priyanka Senthil, a senior at Davidson Academy in Reno and co-founder of startup company AUesome.