Capital Gaines: Smart Things I Learned Doing Stupid Stuff

by Chip Gaines

  Then a miracle happened: HGTV got excited about the city being featured as part of the background of our new show. They started showing the most beautiful elements of this special town. They captured gorgeous sunrises, amazing sunsets, windmills, the farm, the shop, the warehouse, downtown Waco, historic Austin Avenue, Baylor University, the two rivers (the Brazos and the Bosque) that meet just north of downtown—anything that was special about this town, they highlighted it. And this publicity started evolving into an incredible opportunity for the city.

  I guess what I’m saying is that Waco turned out to be our muse, and we found the experience to be mutually beneficial. Our loyalty to our family and this town could’ve ended this show before it even started. But as it turned out, God had a different plan for us all.

  If you want to talk about history, or a town’s reputation, check this out. Up until the early 1900s, Waco was known for its healing waters. There was an artesian well that allegedly had medicinal benefits for those with illnesses or diseases. Those who soaked in that water for ten minutes or longer claimed to experience healing benefits. The way the story goes, people would enter with crutches and leave the waters no longer needing them. This phenomenon drew lots of people into our little city. Then for some reason, over time, those waters dried up.

  Now here we are, years later, and somehow this show and the renaissance happening here in Waco is giving people that same refreshing and inspired feeling that nineteenth-century folk once traveled such long distances to experience.

  So yeah, we took a chance on this town. That’s what you do when you love something. You don’t excuse or ignore it. You don’t tuck it away. You bring it into the light, no matter what anyone else might think.

  Jo and I bet on Waco, and Waco bet right back on us.

  This town was already chock-full of amazing people before we even arrived. Its streets were (and still are) sprinkled with quirky, hidden gems—unique, local places just waiting to be discovered. Waco was primed for an awakening. It had had this beautiful fire in its belly for years, and it only took a few sparks to see this thing ignite.

  The relatively small size of the city is an asset as well. In Waco, if you do something fun or creative, it is the talk of the town. Paint a mural on the side of a random building? The next day approximately 3,047 Wacoans will have tweeted or Instagrammed a selfie in front of said mural. Paint that same mural in San Francisco or Nashville? Maybe a random dog will pee on it. But in a place like this, every small pebble dropped has major ripple effects. Small things can have a massive impact. And suddenly the little city that was so easily overlooked starts to catch your attention.

  As they say, a rising tide lifts all boats. When the underdog starts to gain momentum, you can just feel that things are about to get exciting. And that’s happening in Waco right now. It has become a place that people want to come visit from all over the country. People are actually moving here, and students graduating from local colleges are choosing to make Waco their permanent home at unprecedented levels. Realtor.com listed Waco as the most frequently searched city in the country.1 Good things are happening, and when asked, I say, “Waco is the land of opportunity.”

  Over the last few years, Waco has changed more than I could fit in this book. Cool new places are popping up all over town. (Creativity breeds more creativity.) The fact that we have been able to play a part in this restoration story has been one of the greatest joys of our lives. We have teamed up with people who have fought for this city for decades and with those who are just now joining in. Together, we are rewriting Waco’s history. The old has gone, the new has come, and the future couldn’t be more beautiful.

  These days we see between thirty and forty thousand visitors a week at the Silos. And you and I both know these folks aren’t driving all the way across the country because they need some home decor items stat. We hear stories every week about people who have chosen to visit for a whole slew of reasons—birthdays and anniversaries, honeymoons, and bucket lists. We are humbled and honored by the number of terminally ill people who have chosen Waco as the destination of their last trip. Though those healing waters may have dried up more than a hundred years ago, there is some sense of peace or refreshment that seems to be drawing people here still. There is something deeper going on in our city, and it’s pretty remarkable to witness.

  I believe with all my heart that this town was built for times like these. Waco has already experienced one “Miracle on the Brazos” (a big football win in the 1970s), and it sure feels like a second one is in the making. We’ve only just begun on the full restoration of this town. There is still so much work to be done. While by many standards we’re still an underdog, we won’t grow complacent. We’ve got a lot of fight left in us yet.

  CHAPTER 11

  SCRAPPY IS AS SCRAPPY DOES

  If I had to describe myself in one word, it would be handsome. But if I had to pick another word, it would be scrappy.

  I understand that for some, the word scrappy may have a negative connotation. Maybe you think of a school-aged kid, small for his age, but out there mixing it up with some of the bigger kids in the grade above just to get a reaction out of them. Or maybe you picture a bunch of young men on a basketball court, elbowing one another and taking cheap shots just to get some points on the board. It’s even possible that it brings to mind the neighborhood stray cat that sneaks into your backyard, knocks over the trash can, and eats last night’s table scraps.

  You picking up what I’m putting down? The knee-jerk reaction to the word scrappy is usually something along the lines of “do whatever it takes to get a leg up,” no matter who you may hurt along the way.

  Forget all that. That’s not the way I understand the word at all. I take the word to mean: To have grit. To never give up. To be willing to take a guess even if you don’t have all the information.

  We use the word scrappy so often at Magnolia, and whether you perceive it in a humorous or endearing way, it’s a rallying call for us here. To us it looks a whole lot different than elbowing and roughhousing. I found this definition on UrbanDictionary.com, and I like it: “Someone or something that appears dwarfed by a challenge, but more than compensates for seeming inadequacies through will, persistence and heart.”1

  These three attributes eclipse formal training, in my opinion, any day of the week. Without a doubt, we scrappy types will do whatever it takes when we’re going head-to-head with challenges. When others bail for one reason or another, we’re just getting warmed up. To me that’s what it means to be scrappy.

  I’m not sure how we all came to have these qualities at Magnolia, but one way or another, we all seem to have drunk the Kool-Aid. At least 75 percent of our workforce are millennials, and for a lot of them, this is their first real job. I’m forty-two and almost twice the age of the average employee at our company, so I still have a couple of things to teach these kids. But it’s always been my style to let people figure things out on their own, and there’s something inherently scrappy about that.

  You may not know this (and even if you do, you’ll likely not remember it), but you only retain 5 percent of the content you learn through a lecture unless you pretty quickly go out and either put that content to use or teach someone else what you’ve just learned. If you do that, you will likely remember most of it—like 90 percent.2 That’s because when we teach or implement new knowledge immediately after hearing it, we retain it far better. Our brains work harder this way, and we are forced to reason through the logic. It causes us to focus and concentrate in order to solve problems, and this process reinforces what we’ve learned.

  I’m a firm believer that figuring things out on your own is more effective than being given something on a silver platter. And that belief is at the heart of my personal leadership strategy. I expect our team to dive in headfirst. They don’t have time to doggie-paddle. We pride ourselves in on-the-job training and solving problems. I like people who work first and ask questions later. As soon as I get a sens
e that they’re sitting back in their comfort zone, avoiding a challenge, I push them off the ledge. That may sound harsh, but people who know my heart understand my intentions behind this. I’ve got a different take on the whole concept of sink or swim. In my opinion, you win either way. If you swim, that means you’re capable. If you sink, that simply means you need more practice. It’s less of an “if you don’t make it, you aren’t good enough” mind-set and more of an opportunity to truly assess where you are and what you still need to work on.

  For a long time, it was just me and the guys—Shorty, Melesio, and Jose—who worked on all of our renovation projects. But then we hired Kristen to help out with overall project management. She poured her life into our business. I remember noting the hours she spent working alongside us. The boys and I would be doing hard manual labor, and yet I never questioned whether Kristen was pulling the exact same amount of weight.

  When she first started, Kristen didn’t go through any type of formal job training. She stepped into a world unknown and figured out how to get right to work. She’s the type of team member who thrives at Magnolia. We’ve had employees who required a lot of hand holding and clarification, and those personality types have rarely been able to grow with us. For one reason or another, we end up going our separate ways.

  Just about a month after she came on board, I presented Kristen with her first opportunity to take the lead on one of our remodel projects. Right before she got started, I sort of mentioned in passing not to forget to pull a permit. Sounds easy enough for anyone in the construction business, but I was pretty sure she’d have no clue what I was talking about. So she asked a perfectly normal question for someone who’d never done this type of work before: “How do I pull a permit?” I gave her a couple of suggestions to get her started and told her she needed to figure it out.

  This is how people actually learn, folks. If I’d told Kristen exactly how to do it, she would have remembered that information for a day. But if she actively participated and figured things out on her own, I knew she’d remember it for a lifetime. I believe this approach pays some hefty dividends—for example, having a bunch of capable employees instead of a bunch of babies.

  And here’s what happened. Kristen called around until she figured out which office she needed to go to. Then she marched herself down to the city offices and asked questions until she was blue in the face. And then she finally, finally pulled her first permit. What would’ve taken somebody with some experience an hour took Kristen the better part of a day. But she’d made it past step one of the permit-pulling process. Check.

  Sweet Kristen had this job almost across the finish line when the inspector called to set up the electrical inspection. Pro tip: If there’s work being done inside a wall (such as electrical), then the inspection has to take place before you close up the framing with drywall or shiplap or whatever material you are using to enclose the walls or ceilings. But how would you know that if you’re new to the job and no one ever told you? So she had to rewind and open the wall back down to the studs.

  Kristen will tell you today that she could not have been more frustrated with me throughout that entire project. She’d point out that I knew exactly who to call and what to do. And she’s exactly right. I did. But she’ll also tell you that her “baptism by fire” into the world of construction made her tough. She learned fast. And by being forced to figure it out, she not only gained our trust, but she also earned buy-in with both the contractors and the city. She gained authority by earning it herself, doing the work rather than by my offering it to her as a proxy.

  From my perspective, the point was never to set her up for failure. I’m not one to intentionally hamstring anyone. But I would’ve much rather she tried and failed than be given the guidebook and never learned how to really figure things out on her own. The reality is, that mistake cost me. But I’m willing to invest in paying twice to have walls closed up if the return is growth for my team.

  Kristen is just one (exceptional) example of many talented, scrappy employees who learned to dive in and swim on their own at Magnolia. And the fact that our whole team has adopted this way of thinking gives Magnolia a competitive edge.

  When Jo and I reopened Magnolia Market back in May 2014, we decided that we wanted to establish a culture that challenges and stretches our employees past what they think they can do straight into their “discomfort zone.” We weren’t interested in hiring people who were looking for a fancy job title and a cushy desk job. There’s nothing wrong with that; it just wasn’t our way. We specifically looked for people who seemed ready and willing to take on the task at hand, no matter what that meant.

  * * *

  UN-SUM-UP-ABLE

  A RABBIT TRAIL

  For the record, job titles really bug me. They feel like some sort of pat on the back or a symbol of self-importance. I’ve never had a title, and hope I never do. I’m not even sure what my business card would say. Chip Gaines, Builder? Goat Wrangler? I don’t think someone’s value can be bottled up into a job title. I’ve fought this for a long time.

  Early on, it was hard to give our team members titles because each one was responsible for so many different tasks that their work couldn’t have been summed up in two or three words. And I liked it that way just fine. Eventually I gave in, simply because the lack of titles was causing a lot of internal and external confusion.

  But my point here is, if you want to do well in your work, don’t get caught up in the job-title mentality. Let your work speak for itself rather than relying on some title that someone else gave you or confining yourself to a simple job description.

  It’s just so easy to let that title box you in. If you’re low man on the totem pole and your title hints at that, then you may put yourself in that box rather than think of ways to go above and beyond, exceeding every expectation. On the other hand, if you’re a head honcho with a big title, then you’re likely to rest on it. You may settle in and get comfortable. And that’s exactly what you don’t want if you really want to grow professionally. I should also make mention that never becoming complacent with your position is the best way to make yourself invaluable to whoever you work for. Make yourself irreplaceable to your company, and you will have your choice of titles that can’t define you.

  * * *

  Being a young business plays into our shoot-from-the-hip, do-whatever-it-takes mentality. But even more than that, we’re always innovating and continually looking for new ways to serve our customers.

  This learn-as-you-go mind-set has given our team a competitive advantage that allows us to take on challenges with fresh eyes and sharp instincts. We’ve looked, but there haven’t been many experts on what we’ve jokingly deemed the “Seven Rs of Global Domination” (Retail, Renovation, Rentals, Real Estate, Ranching, Restaurant, and Reality Show) knocking down our doors to offer any sage advice. We have been forced to figure this stuff out the old-fashioned way. As a result, the lessons we’ve learned reside not only in our heads but in our hearts. And as my girl Kristen will testify, they’ve changed our lives forever.

  Some may think that learning as you go sounds like amateur hour, but au contraire, mon frère.* Because we didn’t learn what won’t work, we’ve found that nothing is impossible.

  The very landscape of our business has changed drastically over the years, and nothing has come without sacrifice and hard work. It’s taken a lot of people a lot of long hours to get all seven Rs up and running. There are a handful of folks who have been with us since we first reopened the shop, and most sane people probably would’ve jumped ship by now. Maybe that’s saying something about Magnolia, but honestly I think it’s really saying something about these individuals. They’ve seen us through all kinds of growing pains, and in the spirit of scrappy, we love to look back now and count the number of drastically different positions some of these folks have held.

  Our founding team members, you see, didn’t just pick one responsibility; they picked four or five. Every day they sh
owed up, wore multiple hats, and did the work of a whole team all by themselves. Whatever was needed, they jumped in and made it happen. In retrospect, even if we’d had a ton of money and could do it all over again, I wouldn’t have chosen to hire a different crew to build this company with.

  Our people may have lacked experience and, looking back, that was risky, but one thing our people didn’t lack was talent. If there was a problem, they solved it, and only true talent can consistently create these types of results. But even more important is the fact that each one of our employees really bought in to the spirit of our organization. They carried—and carry!—our vision in their hearts as fiercely as Jo and I do. That’s something that would baffle even the most seasoned headhunter. They’ve grown up with us, and they’ve helped the company grow up too.

  Our people enjoy the process, and they refuse to let things fall through the cracks. If there is a hole, they are going to fill it even if they are already doing their fair share. For example, our top executives will be found wearing “Staff” T-shirts on a really busy weekend or helping pack boxes when the warehouse gets slammed. It doesn’t matter how the job description reads; at Magnolia, it’s all hands on deck.

  The people within our organization carry this rare passion and buy-in, and Jo and I don’t take it for granted, because you can’t teach passion. No salary can draw it out of someone. It’s either there or it’s not. It’s a fire in the belly.

  I’d go to war any day with this group we’ve assembled here at Magnolia. That’s the way I feel about this team. I’m well aware of the impact each one has on the bigger picture. As the “general” of this company, I’m not blind to the fact that without these good, hardworking people packing boxes in our warehouse or hammering away on our job sites, none of this would even be possible. When it’s all said and done, they are the people whose will, persistence, and heart give us the best chance of being successful.