It's a story of true inspiration for my company, Providential Bancorp. So much so -- we were written about by Larry Myler, a contributing writer of Forbes.com. The link is below, but here's the full article:
You’ve heard the bad news many times: More than fifty percent of all start-ups fail in the first five years. Some studies put that number much higher. While people don’t go into business expecting to fail, most stand a very good chance of doing just that. Now, I dislike statistics generally, but this particular statistic drives me crazy simply because it doesn’t have to happen to most entrepreneurs.
As I look back on all of the ventures I have watched, heard of, read about or participated in, one common entrepreneurial trait keeps showing up as the key to success (or failure): That trait is TENACITY (or lack thereof). All successful entrepreneurs have stories of overcoming remarkable challenges that would cause most people to turn and run. Tenacious people just don’t quit. They will analyze, adjust, tweak, modify, re-launch, test, upgrade and try again, but they will not give up.
Here’s one such story I hope you find inspirational.
Providential Bancorp, headquartered in Chicago, is a thriving mortgage company employing 80 loan officers in nine states, that will soon be expanding their coverage to all 50 states. Good for them, you say? Happy for their success? Some people just get lucky, right? Now, here’s the rest of the story.
“In 1999, Providential began with three guys in a room writing loans,” says Dale Turken, CEO. “We steadily built our company up to 110 employees with tremendous sales volume and profitability.” Then 2007 came along and the bottom dropped out of the mortgage industry due to the sub-prime panic. At this point many mortgage companies experienced a drop of 60 percent in revenues, and many mortgage companies closed their doors. Providential had even more problems than most because Bank of America bought their largest client, LaSalle Bank, and promptly terminated Providential’s services. Revenues fell by 90 percent and Providential shrank from 110 employees to five. “That killed our business,” laments Turken, “and we were left with a lot of overhead and nothing to support it.”
Time to give up? Maybe. But Providential kept fighting tenaciously; rebuilding its business from the ashes. Over the next two years, things began to pick up…until the regulations kicked in. Rightly or wrongly, the mortgage industry took the brunt of the blame for the Great Recession, and well-meaning politicians began to write laws that brought some unintended consequences to an already beat-up industry. “Margins were drastically reduced and costs increased as a result of tighter regulations,” reports Turken. Soon there were new forms with new disclosures; new compensation rules restricting fees, and a substantially riskier business landscape where it was increasingly difficult to make a profit. Compliance with the more stringent standards was, in itself, a full-time job.
Most companies would have turned out the lights. Not Providential. They adjusted their business model by creating proprietary software to streamline customer tracking and loan underwriting processes. They tapped into a nationwide pool of loan officers to work in local markets and increase their reach. They hired a full-time training staff to support employees with world-class instruction in customer service and support. They succeeded, and continue to do so because of their tenacity.
Entrepreneurs make their own luck through continuous hard work, and unceasing dissatisfaction with the status quo.
What will your story be? How many obstacles are you willing to face and overcome so that your business will be the success you want it to be? I hope it’s ALL of them.
Do you know of entrepreneurs who have exhibited a crucial characteristic necessary for success? I’d like to write about them. email@example.com
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