Episode 197 - Building a Baby Crib Empire with Daniel Fong
Million Dollar Baby has been designing elegant and sophisticated nursery furniture for more than 25 years. Founder Daniel Fong shares about the early days of his enterprise. He talks about what it’s been like to watch his kids grow up in the business, get involved, and continue to be instrumental in leading the organization into the next phase of development.
All opinions expressed on this podcast, including the team and guests, are solely their opinions. Host and guests may maintain positions in the companies and securities discussed. This podcast is for informational purposes only and should not be relied upon as specific advice for any individual or organization.
Episode Transcript
Transcription is done by an AI software. While technology is an incredible tool to automate this process, there will be misspellings and typos that might accompany it. Please keep that in mind as you work through it.
Rusty Rueff: Welcome back, everyone, to the Faith Driven Entrepreneur podcast. I hope you're in a place where you're ready to be provoked into your thoughts, maybe even blown away because our guest today does that, certainly. Ed Henry, William and myself. Daniel Fong is the founder of Million Dollar Baby, and I Know What You're Thinking, Oh, the movie where Hilary Swank is a is a boxer. No, that's not it. Million Dollar Baby is actually a company that has been designing elegant and sophisticated nursery furniture for over 25 years. That, in itself is very cool. He's going to tell us, though, all about the early days of the business and what it's been like to watch his kids grow up into the business. That's also very cool. Watch them get involved and continue to be instrumental in leading the organization into the next phase of development. But Daniel has a philosophy, a philosophy of being versus doing and how that philosophy shows up in his business life. And in his business actions, it's a little bit mind blowing. But man, is it good stuff? Henry, jump in.
Henry Kaestner: Welcome back to Faith Driven Entrepreneur William Rusty, my co-host, my great friends. How are you?
Rusty Rueff: I'm doing great. How about you?
Henry Kaestner: I'm really well, thank you. I'm really well
William Norvell: tastic. I think Rusty is alive over there. Yeah.
Henry Kaestner: Rusty is having some visual problems. You know, this is a podcast, so most of our guests can't see how we look in the studio audience. Imagine if you will, this is the most amazing high tech sound studio ever, and that's actually not where we are. But just imagine that I think that that's helpful. Last night was a special blessing. We have, and I think we've talked about this before in the program. We've got a group of faith driven entrepreneurs that get together out here in the Bay Area called inklings and inklings is in amJ to C.S. Lewis and Jared, and I got together and call themselves the inklings of the Eagle and child. And they were great friends. They shared fellowship together. They were constructive critics of each other's work, and some beautiful things came out of their friendship. And I think we all know about that. So we've been doing that since we did the inklings in Durham, North Carolina, for four or five years. And then that continued in various forms, which had inklings groups in Singapore and Jakarta. But probably the most vibrant group is out here right now in the Bay Area, although groups are starting to spread a whole bunch of other places. I know that there's a vibrant group in Atlanta and other places. And I think that over the course of the coming year, I think we'll probably look to encourage more of that because, you know, we've got this new program for small groups. We've got this small group study that I did with JD Greer and eight weeks going through the marks of a Faith Driven Entrepreneur. And I think we've got 300 Faith driven entrepreneurs are going through it right now with twenty three facilitators, which I think is pretty cool. But we have this, you know, this physical gathering of entrepreneurs who get together and location. And last thing on small groups is that what's cool about is the make up is you can be in a small group with a Faith Driven Entrepreneur from the Congo and from Brussels and from Spokane. It's really neat in the way that there's a lot of diversity. Last night, William was the speaker at inklings, and he shared in a way that was really profound. It was vulnerable, it was transparent and he had a theme, and William just wanted to touch on a theme. I think at some point in time, we will record. We'll take the recording of last night's presentation and in some form or fashion, maybe in an edited down version of it, we will share with a broader audience because it's so much of your personal story and there's so much there. But you talked about a theme. I think it's relevant for all of our audience. What was it?
William Norvell: Oh, yeah, thanks. So the major theme was so the guy's been doing in my life where he's just been pushing me towards the phrase that is meaningful risk. And I feel like God's just been pounding on me to try to figure out how to do that with him. And, you know, three at the biblical point I process through not to say everyone. Thirty five minutes here than thirty seconds was to take meaningful risk. I think you need to understand grace and understand how much God loves you and how it's never going to leave you. You need to understand humility, how big God is, how much we are a extra in the play and he is the star. And then third, to understand what he puts in front of us to be passionate about and not in the happy sense here. This is holy week on a recording, but in the sense that what are we willing to suffer for? And as I processed through that, I think that if we can take God's grace and be humble and find those things that we will suffer for that those are worth taking meaningful risk for.
Henry Kaestner: Indeed, it was really, really good. And we're going to need to unpack that. Maybe in a future podcast episode. At the very least, I think we need to go ahead and take the PowerPoint presentation that you had because you had some great context and some great scripture references, and it was just a great framework to ask us about whether we're taking risk. One of the memorable quotes was the way we were able to paraphrase the Bible a little bit. And just like, you know, what's the greatest risk? What's the worst thing? It can happen, right? And I think it was, was it from Luke? So like, I think the worst thing can happen is you can get killed. That's it. That's it. If that's it right, why don't we take action? All I can do is kill you. All you can do is kill you. And I just I thought that was really profound.
Rusty Rueff: The other day I was reading pick back up my utmost for his highest oswal. Yeah. You know, daily devotional. Yes. Yeah. A few weeks ago, it reminded me of Hebrews 11 eight. He had a thing about Abraham and Abraham. He went out not knowing where he was going. And right. I mean, the ultimate risk, they're right, you know, a life of faith. He went out not knowing where he was going and just follow what God told him.
William Norvell: So I may or may not own the web address going without knowing for a future project.
Henry Kaestner: Really? Yeah, that's awesome.
William Norvell: Without knowing was, I had to get that. I'm going to use that for something one day.
But you
Henry Kaestner: should. You should. I like as well. OK. We have a special guest with us. Daniel Fong. I can't even remember how I ended up connecting in with Daniel. Maybe it matters. Maybe it doesn't. But we had a really neat conversation five or six weeks ago, and as I was talking to Daniel about what he does and we're talking within the context of this ministry, we have called Faith Driven Investor. And if you don't know that we have a separate blog and a podcast and we have a lot of fun with that. But as I was talking to Daniel about his investing experience, I came to understand, of course, that he has an incredible entrepreneurial story as well. And there's so much overlap with Faith Driven Investor and Faith Driven Entrepreneur. And he's really leaned into his role as an active investor, understanding that he has this opportunity of pouring into a next generation of entrepreneurs, and he has a framework through which he goes through it. And as he's going through it, I was really captivated. And I think that there are some things and I never say this. I mean, we always want to keep things fresh around here. I don't think I've ever said this before. I guess there are some things that I'm not 100 percent sure that I agree with with Daniel Daniel. Talk about, for instance, about laying off people, and he's got a very strong view on that that I think is really important and I continue to chew on that. And whether you agree with his view on laying people off or not, I think it provokes a really deep, hard look at what it looks like to love our neighbor. That is beneficial. So I'm looking forward to doing that, and there's so much more. There's generational transfer to talk about. There's investing to talk about, and there's an incredible entrepreneurial story that he has behind Million Dollar Baby. So, Daniel, thank you for being with us.
Daniel Fong: It's so good to be here with you all. Thank you for inviting me.
Henry Kaestner: So, Daniel, we'd like to hear about the background in the story who you are, where you come from. We do that with every one of our guests. You've got a great story. Why don't you lead us up until the time of Million Dollar Baby? What's your background?
Daniel Fong: OK? I grew up in a Christian family, going to church every Sunday and was baptized at the age of 15 before I left Hong Kong for boarding school in Massachusetts. After graduation from college in 1979, I returned to Hong Kong and joined my father's textile manufacturing business. He was extremely sick with a stomach ulcer and being the only son and oldest in the family, I felt compelled to help my father at that time. His also got cured and after four years when Great Britain announced that Hong Kong would be returned to China in 1997. My parents, who both escaped to Hong Kong from communist China in the 50s advised me to become a U.S. citizen, so I joined Li and Fung, a global training company, started their venture capital business in San Francisco and built up my confidence in tackling multiple assignments during the six years I worked for them. On June 4th, 1989, the so-called incident in Tiananmen Square was very traumatic for my wife and me and our two very young children. We decided to immigrate to Los Angeles, where two of my youngest sisters has settled. We arrived in L.A. on October 1st, 1989, decided to take a three month break before looking for work. Since I have worked in the family business and also one of the largest global companies, I decided to go for a new experience in running my own business. You see experiencing different experiences under the umbrella of continuous learning. It's part of my lifelong goal. I actually had it written down in a reflective document in 1990. It says to experience as much experience possible. Therefore, it is not a typical reason for the most entrepreneurs to start their businesses. My reason has nothing to do with ego making a lot of money or being in control. It was simply a new experience that I was pursuing. It is definitely not about changing the world and making an impact. I was not traumatized by my experience working for my father and also the big global company. Therefore, there is no mission to correct any wrongs, so to speak. In the beginning, I was going to open several businesses that will support my hobbies, like raising colorful tropical fish and a beautiful flower and plant shop. In terms of how my faith influenced my life and my decision to start my own business, I don't think it was a big part of my being 10 30 years ago. The final sentence in my 1990 reflection document said to live a balanced, multifaceted life of continuous improvement under the guidance of God. In that sense, I am no different from most people, including Christians, that I know it is all about me. The world is centered around me, and the focus is how to be successful usually means making a lot of money and under the guidance of God is how we act or sugar coats are basically secular life with Christianity. Some from the age of 21 to 41, including the first 10 years and running Million Dollar Baby. I am a typical hard charging business executive and a very successful one, so that's my doing face. And I was an excellent doer. From 2000 onward, I embarked on a different journey and in practicing and perfecting a doctrine of being before doing.
Henry Kaestner: OK, so that's there's so much to unpack there, and I want to do that before we do the being part. And this is one of those moments, I think, in our podcast, that's an important to pause this concept that we're going to get back to here and second of focusing on being rather than doing is really, really, really important. And I think that we as faith driven entrepreneurs miss it more often than we should. I think our Chris farmers do, but I think that Faith driven entrepreneurs are focused on doing and we need to be we need to receive first. So a lot more there. But let's go ahead before we get to the being part. Let's unpack a little bit more of the doing part because you had a consumer brand, a good number of people are going to be familiar with it and want to hear some of the lessons that you learned as you start a million dollar baby, as you expanded it, as you brought family members into it. Help us understand how that started and how it grew during your doing phase.
Daniel Fong: As I discussed with you before, I would call it, and I put on the divine appointments how I started noticing this company called Million Dollar Baby, which is a very small wholesale company in Los Angeles. The time that I bought and the divine appointment was because I bought another similar company. The second year round, who was located in Dallas, Texas. So in two years, you know, basically I have two branches and then subsequently then we expand to Atlanta and New York. So Million Dollar Baby, that is different from everybody else during part of it. It's a true multi-brand company. We do not simply create brands simply for channel management that is naming identical or similar products under different brands. We have seven major brands now and many smaller sub brands. It is a very complicated and sophisticated strategy that requires us to know and segment our customer truly well. Each brand identifies type of houses or homes that our products would go into. We know the cost that they drive and the lifestyle of our target customers for each of our brands. No other companies in our space have been able even to come close to what we have achieved in our industry for the past 30 years. Million Dollar Baby is the first call of all the top retailers because we have been awesome partners to them. So the goals of our awesome sales team led by my daughter Tracy, is not a particular sales number. To be the first call is the goal. Sales to us at Million Dollar Baby is the result when we serve our customers well, different from all companies that I know. Million Dollar Baby does not have any long term goals. At least we have annual projections, not sales goals that are more about supply chain management. To be the most loved brand is our long term goal, and no more boring nurseries is our mission. Million Dollar Baby Focus is on excellent execution on a quarterly basis. We spent one week every quarter when the entire company slows down, reveals what happened during the last quarter and formulate new plans for the next quarter. I do not know of any other company in this world that would dedicate one week every quarter for this very unique practice. However, I can see how the alarm bells are ringing with our listeners because short term quarterly results are why many public companies are not doing well are in trouble. It is therefore why I need to unpacked our quarterly performance review. We practice more clearly. First of all, my intention is to stimulate not to advocate any duplication because no two persons are the same and no two companies are the same. What works at Million Dollar Baby will probably not work at your company if you simply copy what we do. It is not the doing that matters, but the being. The short term quality focus is based on my subscription to Matthew, six, 25 34, which is the do not worry section in the sermon of the Mount Verse, 34 said. Therefore, do not worry about tomorrow for tomorrow will worry about itself. Each day has enough trouble of its own. Four million dollar baby outgo is not about maximizing profit. That is not our reason for being. I personally, therefore, the company submits to the following doctrine. We express our love of God with our my soul, mind and strength by being excellent in everything that we do and with every encounter. Yet our claim of excellence need to be confirmed invalidated by all our neighbors, which includes our employees, our customers and our suppliers. In that sense, our excellence is a reflection of how we love all our neighbors. It is what I call the rootedness of our being or the reason why we are in business. Profits or sales are just results. They are not our goals. Another significant difference between Million Dollar Baby is our attitude towards our employees. We do not have a human resource department. We do not treat our employees as resources that we acquire and discard. I coined the term talent management 30 years ago, and I am happy to notice that this term is becoming popular instead of paying lip service by claiming that our employees are like family and the most important asset of Million Dollar Baby. At this time, we have a $10 million emergency fund that will allow us not to lay off a single employee for one year, even if our sales drop to zero. I do not believe it is morally, ethically or biblically justifiable to use lay offs as a legitimate business to if we claim that our employees are truly our family members.
Henry Kaestner: So that's fascinating, and that's what I alluded to at the beginning of the program, and I've been spending some amount of time thinking about that, and there's so much cash, there's so much in there. First off, we've had three babies in our house and none of them have been boring. But I do think that I end up spending a million dollars preach baby with all the care that they get so much of that I can identify with. But more seriously, this concept of never laying somebody off is fascinating to me. You couched it in this context of loving our neighbor. Right? You're very deliberate about that. You talked about the suppliers and the customers and your employees, the people you come across and you're compelled to love your neighbor. And your sense is that if you haven't planned appropriately and because of an economic downturn. You have to lay somebody off. You haven't loved them, you haven't love them by having planning ahead. Now that's peculiar because it stands a little bit in opposition to your idea of not ever planning, right? So there's two other very interesting things that are kind of in tension. One is always plan to make sure you have enough money to be able to make sure you don't lay somebody off. And yet, on the other hand, don't overly plan. We don't have a five year plan, a bandwidth, by the way. I always wanted a five year plan. David said. That's ridiculous. It's stupid. It's Stalinist is actually the word he used. And so we never had a five year plan, so we had a four and a half year plan. Now we just ended up not having great plans, either. But talk about that tension between planning and I think that there's a distinction here that you're planning financially to have enough financial resources, but not overly programing what the activities are. You should just unpack that a little bit. And then I think that mean Rusty will pick up on this very novel concept of never laying anybody off.
Daniel Fong: Yeah, I think, Henry, you can see that I have been really framing the discussion of laying off because I know that I've been practicing talking to a lot of people recently about this, and a lot of people are having a lot of pushback. So I would say that the first is not a planning that's not politics doing when I decided not to lay it. I think that's part of the definition of my being. So it should be part of the whole reason of actually running a business or what is the theology behind the business. The challenge to everyone that I've talked to is that everyone, including Christian businesspeople, would say that the purpose of a company is to maximize profit. Right. So it seems like no one would ever even debate that. And that's where I'm coming from is that the rootedness of business is really not about making a profit. Profit is the result. So to me, the rootedness of the business is how I can express my love for God by glorify him with excellence and then loving my neighbor. The greatest lord that Jesus Christ command us to do should be, to me, the rootedness of my being and the reason why the company exists. And so with that as the rootedness, then what do you do, you know with your employees? So to me, you can say it's planning, but part of is that if you treat employee just like a family member or whatever, but then you have a different starting point. I understand the difficulty when I challenge people, but the Norvell layoff policy, because if you don't think about that and then when the economy drops and disaster hits or something, yeah, then what are you going to do then the Christian ways that you try to be as loving as possible to try to deal with and then use your laying off is inevitable because you never really sort of position the being of the company in terms of thinking that way. And that's why you're not prepared for that. So that, to me is that I'm reframing is that we need to go back a little bit. You know, you can't just now suddenly have no layoff policy when you're not prepared for it. So for me, having that emergency fund is part of my being statement rather than my doing statement is to being of the business. To further illustrate that is that it's really there's two aspect because last year COVID hit and I have just say without naming names, right? Major Christian companies now people that are, you know, running billion dollar business or they're building. There are some things that are featured on these podcasts. They all basically lay off thousands of people as part of that, I think expression that, you know, this is inevitable and I usually ask those question. But the key element for me today is that in at least two cases, they said 2019 was the best year ever in their company's history and that 2020 hits. And then, you know, they have to lay off people. So this what I want to introduce that there it is possible if you change your frame of mind from a A. sales type of or annual profit. And that statement, right? This is something that I actually discussed to a lot of my wealthy friends, right when they started and I said, Hey, you have made a lot of money with this group of employees for the past 10 years, 20 years, right? So if you look at that as one year now, right of all the years, the profit that you have made, then this one year you hit and note did affect your current year now and you start laying off people. So whatever it is, that means you pocket it for the past 20 or 19 years, it's yours. So now, I mean, I'm just saying the frame of mind is that if you think about that, all the profits that you made for the past 20 years, it's very difficult, I think, for anyone to justify laying off. That's just a frame of mind along the same line, which is also that I got very upset by reading Howard Schultz book on when he came back and sort of turned around Starbucks. And then too many shares of Zappos. When he moved from San Francisco to Las Vegas, they both laid off thousands of people and they actually. Wrote about how they were crying people, what I meant to me, that doesn't really make sense because both of them are billionaires, right? So let me just put it in a framework, right? I think in both cases, it's like 3000 or 4000 people. So for 3000 people assuming $50000 a year's salary, right, three thousand fifty thousand, that's $150 million. Right. It's a lot of money. But if you're a billionaire, if you give a one hundred and fifty million, you still have eight hundred fifty million dollars. This is where I'm saying that. That's not really a planning statement. It's a being statement. Is that whatever you know, money I derive from the business in the past, that's me. Right now, I have to lay off people because that's sorry, because that's how business is right. That doesn't really sound very logical and sensible and very Christlike to me. That's really what this is not something new because I have always felt very sad. Every time I read this newspaper news about this since the 80s, you know, when I first after graduation are laying off people. It's a major corporate move, and every time there's a economic downturn laying off people. So that's why I felt bad. And that's so in order for me to be truthful and thought that offensive to my feeling of doing that, I would. Why would I duplicate that if that is the case, if I'm upset about that type of practice? So that's why it started. I would say 20 years ago that I really seriously put this into practice by creating an emergency fund.
Rusty Rueff: Yeah, I think it's fascinating, Daniel. You know, if I reflect back and I think you appropriately have defined the time frame and in the late 80s, because it was really the stock market crash in 1987, that changed some significant thinking about how companies thought about things just prior to that, like I was part of the PepsiCo companies and Frito-Lay. Frito-Lay, never Herman would not allow people to be laid off, right? And in 1991. We went through the first significant layoff in the company's history and it changed, I think, forever the tone and tenor of the relationship of the employee in the company and not unlike Watson and how he ran IBM right. IBM was a lifetime employment company. People forget that when you joined IBM, when we were coming up, you know you were guaranteed lifetime employment and then they they moved away from that. It changed the relationship. So I think it's fascinating because in some ways you're bringing back the past to the future and running counter to really this idea that profit is everything. Now that being said, you know, let's also remember, I think that when you take other people's money. Right. So if you're an entrepreneur and you've taken other people's money, whether that's venture capital, who has an expectation from their limited partners for return or you go public and now you're a public company, you know, it's much harder for these, you know, as you talk about Tony and you know, Howard Schultz, and for them to step in and say, Oh, well, I'll personally save this, you know, because they have expectations from shareholders. But what I am fascinated with is this idea of the emergency fee, right? This emergency fund, because whether you're a big company or a small company, you know, you could begin to think from day one about a cushion, the rainy day fund to say, rather than immediately go to my labor line as my savings. I will draw on that fund first, and I see that as a very positive long term investment in the company. Right? You know, to have that and in some ways, it really, you know, I'm sure when you talk to your employees and are they hear that you have that when you're recruiting somebody, their first feeling has to be something like, you know, people must have felt from Watson when they talked about lifetime employment. It's like, Hey, you care that much. That's pretty cool. That's pretty cool. So I applaud you for it. I think it's really probably hard for some of our listeners right now who are under the impression are under the influence of other people's money. Amen a board that would look at them and go, Are you crazy? But it's really thought provoking. I really appreciate it.
William Norvell: I agree. The only thing William here I would comment is, you know, I had this conversation recently because a lot of my friends worked at Airbnb right before they went public. And I don't know if everybody tracked this. But you know, as you might imagine and covered, at least in the very beginning stages, the business took a big hit, right? And they eventually laid off. I think it was twenty five percent of the workforce. And then about three months later, they went public and the stock tripled. And you know, Brian Chesky is worth $15 billion now and the tension. They're there, right? I think the public markets were actually happy that they shed expenses. Right. So I think he actually got in some way rewarded for that. And I just think it's a tough tension. I think it's profound thought because we had lots of conferences like, how is this guy that made $15 billion could have kept some people on stock because Airbnb is now, of course, recovered. Right. And the companies do it incredibly well. And of course, people are going to start traveling again. Like, how was there not a six month cushion there? And I think he gave people six months severance. It wasn't just a horrific thing, but they did lose their jobs and they have to find a new one in the midst of a pandemic and they work at a travel company. Right. So I just think it's a profound thought. And, you know, I just thank you for sort of going out and taking a risk. You know, I think we've talked Rusty in here a little bit about, you know, finding what Jesus would have for us in our business. You know, and I think you said it so well, data one size fits one, like, what is Jesus calling you to do? That is different, right than what the world tells you to do. I hope people think about that. I hope people think like, what could that be? Maybe it's this. Maybe it's an emergency fund for layoffs. Maybe it's something else. Maybe it's how to love them through having children or whatever it may be.
Daniel Fong: So comment on the emergency fund is actually we never really have to draw it down or it have to use that because we never really actually have to face that situation. But the funny thing is that we did actually have to use the emergency fund about five years ago. You know, when my son transitioned to CEO and I think she made some mistake in actually doubling our inventory basically overnight by some glitch in the programing and the strategy? And that was helpful to have an emergency fund in terms of that. That's right. It was pretty traumatic for us for about a couple of years. But then so it it's that's what I would say that sometimes, you know, when you do things with a different motivation, which is talk about the being, God will bless us because it was not really for a certain intention, but it can be very useful in other things and it's also very powerful. Last March, we were one of the, I think, if not the first company to actually shelter from home because my son and Mike, it's just very, very protective all about our employees and we treat them as as family members. So he said, why would I not do that if I'm very, very concerned about the health issue, I should extend that to all my employees. And the first thing that we said, because we were anticipating at least a 50 percent drop in sales, at least because everything was shutting down and all that. So again, that was the time where we thought that we would have. So the first thing that we announced when we shelter from home is that there will be no layoffs that just tell everybody just to be calm down and not to worry about that. And I'm just saying that you cannot believe how powerful that statement. Of course, we've been repeating that throughout our quarterly meetings and stuff that I've been talking about, but to actually right when the situation arises to say something like that, it's really, really powerful to our company and to the morale of the whole company.
William Norvell: That's amazing. And you know, as I mentioned earlier, just like I feel that meaningful risk that Jesus put on your heart and you took it. And here he is, walking with you through it. So I want to switch to this. You just mentioned your children a little bit. Could you tell us about running a generational business and how that's worked out where you are now and just kind of walk us through the generational transfer of the business and how your children got involved?
Daniel Fong: Yeah, that actually, it's really a tremendous blessing, right? I mean, because you hear so many negative stories about family business and our family working together never worked. And actually, I'm from Hong Kong, right? Almost all the major families in Hong Kong are suing each other. They're having problems. So it is obviously very, very a great blessing if things worked out. So I guess it could be because the same thing, right? When you read a lot of these layoffs news and you think about it, it's OK. Well, now how does that affect my being? So same thing with running a family business is actually that was not intentional. In the beginning, I work for my father. And so when my children are very young, I actually said two things to them. I said, Just because your father and your mother running their own business, there's actually no pressure for them to come and join the family business. That's I stated that very early on, and I actually encouraged that they go on and do other things, you know, right? Because I work for a big company and then eventually I start my own business. I thought, that's not. That's as I experience. I also tell them that they cannot. Just because their last name is Fong automatically assume that they have a VP position or or event. You will take over the company because, like I say, I have my team that I've built up, so that doesn't really work well with me. So the amazing thing was that while I really don't want that to happen, I think that's why I really subscribe to divine appointments. That is, God set the schedule and cuts at the programs in my life. Two thousand four I, my daughter. Graduate from college at the same time, my wife who's. Just in the ABC, early 40s got colon cancer, and it was very surprised, you know, it was a sudden thing, and we really cannot deal with it in a much smaller company than 2004. And so I asked my daughter simply to delay her employment in New York City, working for Christie. So about three months so that we can reorganize and hire more people to do what mom is doing and things like that. And so she agreed. She said, OK, I'll just take a no delay for three months, and she joined the company. It was a temporary thing for me, but what I heard from the team was that the first day she came to work, everybody said it was like a breath of fresh air that came through the office the way that she talks as she carries herself. In this, she just how she works was really amazing. And as she loved the business and she staged, so she continues with and working the company and I I felt very, very blessed and very, very excited to be working with my daughter. And so then I changed gear because my son will be graduating in two years time. And I actually did a proper recruitment exercise, and I'll find him out to the company spring break, along with two of his classmates that the wine and dine them, you know, explain to them and try to recruit them. So that was not a typical father and son talk. OK, now it's time to come back to work for a father. Usually work for peanuts, you know, because it's a privilege to work your father. And all that said, no, I did a proper recruitment because there were two other classmates that we were trying to recruit. The bottom line was that all three of them joined a company, and so I would say that that recommendation, it's that all parents should look at it, that instead of a requirement that their kids joined a company, that they should really try to think of it as recruiting the best employees possible. Now regarding the transition part is also interesting is that because I actually besides my two son and daughter, I also have a brother in law. I also have a sister that works in the company. So as part of the being statement, right? If we want to glorify God in business as a Christian family, I just have this notion that we should not argue in front of the employees at the business when we're working together because it is inevitable, like even with family, that disagreements at different issues. So I created a family meeting for all the family members that work in the business outside of the business, and it's shared by not myself, by a chair, by a good friend of mine who's a great coach. And I would say that it's very helpful and very transformative in terms of how the family showed up at the business every day because we resolve all the issue separately. And during one of those meetings, it's when I was thinking just out loud, I said, Well, I mean, eventually I would do not want to continue to be the CEO because things are changing fast and everything requires a different type of energy. And I just felt that I want to have that discussion and basically immediately there was some resolution. My daughter set l'État. He goes first. You know, so even though she's older, but she felt that, you know, the brother should go first and then immediately. My brother in law, my sister, said, Ted is not ready. And then the next conversation, OK, fine. They will do a three year co-CEO situation and then transition to CEO. So I would say that that is a significant piece of sort of strategy that I've been advising a lot of family business now to sort of try to have that type of a family meeting outside of the business and chair by someone that's outside of the business and to really worked out all the issues outside the business first and showed I was a united front at the business.
William Norvell: Could you tell our listeners a little bit? How often do you meet? When does that meeting kind of happen? I mean, you said you had a coach. I mean, I assume this is someone you hired, like you hired a professional to come in, just kind of talk through that. I think that's probably something that that people would be interested in.
Daniel Fong: Yeah, the rhythm is always quarterly, so we run the company in a quality basis. We spent one week every quarter, so every quarter we will have a family meeting before the quality meeting. So the rhythm is quarterly. Yes. And I don't know if you guys know about this organization called this stitch, which is the year with it executive training organization. So I was a member since 1992 as part of my continuous learning and just try to, you know, be a responsible executive. So Richard was my chair, then he later became the president of the organization. But then now he's also back. The chair and so I have a long relationship with him, so I trust him, and he knows the family really well. So that really worked out really good. So does that answer your question? It's a
William Norvell: it does. It does. No, I appreciate that. And unfortunately, we're coming close to the end. But I have to bring up one thing that I've heard you say before that I think may or may not have come up in this meeting because I have a feeling some other CEOs may have a similar issue. Can you explain the seagull problem that you suffered through while serving as a co-CEO with your son? OK.
Daniel Fong: The funny thing is that I know that it came up with the Inc magazine interview and all that stuff. Of course, I don't claim that I'm the CEO.
William Norvell: Of course not.
Daniel Fong: Of course, I did things like that, but obviously I think it was during the co-CEO phase, which can be tricky because co-CEO, meaning we have both the CEO and I would say, Wow, I just know the correction of that. If it actually did happen to correction right now is that I only influenced my son right now with a one on one every week. I do not do anything outside of behind my son's back and try to go. I think that's the Sego type of situation whereby a lot of the patriarch owners, you know, even though they transition to second generation, do feel that they're still the owner and they still want to do certain things and so they can go in and they felt they have the right to now, you know, because I'm still the owner, former CEO or something, and that is problematic. And right now, that means that my son is not in agreement with me. Then nothing happens. So my only influence is through my son. And that, I think, is very, very crucial for all. Actually, older generation needs to realize the problem. From my observation regarding generational transition or even not necessary general, I just transition. It's usually it's the older generation or the older regime refusing to let go. I think that is the root problem and that goes back to rootedness again at the being right. So if you want to let go, then you let go and you really can focus on helping the second generation to succeed. Like I said in the beginning, I hope that my talk is not a encouragement to copy what I do, but a stimulation thought. That means for the older generation to ask the son and daughter to just copy what they have done, which is what they do. And you know, your father and mother and you know, we're so successful. So here are the 10 rules you cannot change because these are the doctrine that have helped the company to become so successful. So you need to continue that for the rest of your life. And that, to me, is so sad because that is just a straitjacket towards the second generation. And that is actually, to me, a definite formula for failure when any parents say things like that to their children.
William Norvell: Well, I think that's profound. And anything Rusty I might swing it to you is what you've seen in your career. I mean, I think you see entrepreneurs that finally give up product and they still want to come in and own it or they finally give up. I mean, how have you seen that play out? I mean, just like I think that's such a profound lesson, like the one on one that's so good.
Daniel Fong: There's a rootedness that do that, too. It's a rootedness about the legacy. You notice this thing going right now that a lot of pastors don't finish well, right? So that one, there's a solution. There's so many books out there is that because they're not focusing on their legacy. I think that is problematic for me. The only legacy that I care about is Jesus Christ. I don't care about my legacy because I'm like dust. I'm already so privileged and blessed that I can even live like this and know that the whole notion about legacy is problematic. So that's why the only reason one way and let go is that you don't care about your legacy and you care about the legacy of Jesus Christ, which is how you glorify him. Then you see that helping the second generation to succeed gloriously is the right move. And that's I think I keep going back to rootedness is that we have to understand as Christian, what are we supposed to do? I keep saying that is not a sugarcoating of Christianity. Oh, I do Bible studies. I have small groups and all of this. It's really about our whole being needs to be radically transformed. Rusty Sorry.
Rusty Rueff: No, no worries. I just wanted to say that, you know, for some of our listeners who aren't in family owned businesses, this is the same thing that happens with our boards, right? Our boards can also be seagulls, and we, as board members, can be seagulls. And we, as CEOs, our founders can be seagulls. And we, as department heads, can be seagulls, you know? So I think it's really important that we all take a check in our own spirit, you know, to make sure that we're not seagulls managing. Yeah.
Daniel Fong: And a big factor of being a seagull is a timing issue. Is that because everybody has different priorities, a different right to be a CEO is that I feel this needs to be done now. This is to happen now. So because I'm eager so as SIG, I want to make it happen. But what I have found out that right now, for example, like my son, it may take a. A few years, but eventually he'll get around to it and then he will execute it and in a very much more glorious fashion because it's more together because he is actually, you know, digested it and his being that affects is doing. And so the segue out, like you said, to board whenever you have the eagerness to see certain things happening, but sometimes be patient, work with the CEO, the person that's really the the chief execute a wait. You know, allow God to come in and and I'll create the divine appointments and these things will happen. And it's just really wonderful how I train myself, be willing to not care about my own legacy and just really watch how things develop with my son. I cannot describe the joy of that experience.
William Norvell: Amen Amen. That's a perfect way to head to our close here, Daniel, where we love to ask. I would imagine there are many parts of God's word that has shaped you into being able to have that perspective. And I would ask you if you wouldn't mind sharing with us in our audience. Where does God have you in his word today? And where is the scripture coming alive to you in this season of your life?
Daniel Fong: Well, I just finished my master's in theology degree at Fuller Seminary after five years, so I'm this better.
William Norvell: Be good, then
Daniel Fong: I'm really happy about that. So there's two things that I felt very strongly, particularly after my last class on numerology, which is the Holy Spirit, which is a subject that is not really being talked about much in the western Christian world. So right now, I think I started a nonprofit called Uncommon Voices Collective. It is to deal with the polarization that's happening, particularly in the United States, but I think it's happening all over the world. I mean, we can have another podcast to talk about why this is happening and part of it's also economics, because that's how you news organization money now. So I felt very strongly, particularly also in the Christian world at American Christianity, sort of what I've been talking about. It's counter, you know, theological, you know, based on the American Christianity. So I want to be able to have some voice and just be able to expose other Christian to some different type of thinking that I've been. I thought I was just weird for the past 30 years, and since I like all my business, I can do whatever I want, but I think I have some good resonance with with talking with a lot of people. For the past, I would say, particularly three years. So that's one thing. So we were a print media. We have a lot of YouTube content and podcasting already. But eventually, we're a magazine to print maybe some books and something, which is my second project that I felt that the strange theology I would say that I have, I start writing down all the different subject matters, like being before doing and Norvell lay off and all that stuff, which is actually not theological and just philosophical. It's actually being applied in a business and a big business. We didn't have time to talk about Alabaster, which is a startup, but it's doing so well, which is also a different way of investing in different way of doing startup. So, so all of these, I thought that I felt very strongly that there is a voice that I need to expose that a little bit more in terms of book. So those are my two projects that I'm working on right now.
Henry Kaestner: Now, is there something that you are hearing from during your investing, from working with your son or just in your daily Bible time that you feel that there's a verse or just something that just in God's word, that you just kind of just hanging on to that you feel like he's speaking to you specifically about?
Daniel Fong: No, I do not worry about tomorrow. It's really, really powerful to me, and it's a constant reminder. I think it's note that relates exactly to the being in doing because if you notice everyone and most people, including a lot of Christian, particularly Christian, I would say that is very missionary oriented. They think they want to do a lot of things for God to grow. I mean, there's a lot of doing it as a Christian, and I think we really need to remember God saying, you know, just work on every day, you know, you know, which I subscribe to and you talk about in the beginning, you talk about death. I have a really interesting story about dying that you know that it's part of of that theology is that if dying is the worst thing that we can face and we should as Christian, that should not be a problem. But if you notice the behavior of most Christian is like dying is a big problem and avoidance of dying is actually, you know, it's a big issue. But do you see that to me is there's a being issue, right? If you say you're Christian and you do your same all these Bible study stuff. Why are you so anxious about doing all these things? And also another, I would say, two chapters, which is Revelation Chapter 21 and 22. And I think most people really need to continuously read that every day, along with Matthew six. Thirty five. Is that the description of the new heaven, a new Earth? It's not the tendon on any one of us do. Anything is not does not, depending on us saving another soul. And how do reading an error memorizing another Bible verse that has nothing to do with it as God has already done it? But the grace and the blessing is that we get to participate it through the invitation of Christ that we can participate. But this is not about us making it happen, right? We need to prepare this so that Chapter 21 22 will happen. There's nothing to do with it. So I think all of this has to do with our doing. It's really we need to put our doing in the right context, and that's why I focus on my being. Because when I'm reading the verses Galatians 20, I have been crucified with Christ and I no longer live, but Christ blessed me. So that's the being way Christ lives in me. My doing. Is that Dennis? Read what they call about the work of the Holy Spirit and the fruit of the Holy Spirit, which is Galatians 5:22, right? So it's not my fruit. No holy all Christians that how I can bear fruit. No, we don't bear the fruit. We witness the conduit. We're just the branch of vine, right? So. So all of these, if we put it all together, would orient our being at a proper pace and then our doing would be so joyful, so peaceful, so, so loving. And all that because it's not how we're doing, it's actually the Holy Spirit through Jesus Christ as actually doing that. And I'm just saying that I actually can document now through my life, through the businesses that actually this can happen. And it's really, really joyful and amazing. I really want to share that with everyone that it is possible. And it's not just theological that it is possible to live a life full of Sabbath, which is not a event which is not one day out of the week. It's actually a mindset is an attitude that we have peace continuously and be with Christ 24 seven. Isn't that? Doesn't that sound very good?
William Norvell: Yes, it's awesome. It does.
Henry Kaestner: That's an encouraging note to end on. I wish we didn't have to stop, and maybe this is a harbinger of things to come than talking about, and I'm packing a lot more of this. It's infrequent that we have an entrepreneur and investor. This happens to be graduating with their master's in theology. So this is great. You blessed us. And Daniel, we're grateful for you.
Daniel Fong: Thank you for this opportunity.