This CEO was a millionaire at 22, went nearly bankrupt, and now runs a $100 million business
Tomas Gorny's life is a true rags-to-riches story that should serve as an inspiration for any budding entrepreneur.
He arrived in the US from Poland in the '90s when he was only 20. Barely speaking any English, Gorny had to work part-time valet parking and carpet cleaning jobs during his first couple of years in the US.
Today, he's a successful serial entrepreneur running three different companies, including Nextiva, a cloud business phone service that's on track to hit $100 million in revenue this year. He's sold his two previous startups, including Endurance International, which was bought by Warburg Pincus and Goldman Sachs for nearly $1 billion.
Gorny may not be a household name in Silicon Valley. But there's a lot to be learned from his life story.
"What I've learned so far is what enables me to do what I do now," Gorny tells Business Insider.
22 year old millionaire to near bankruptcy
From a young age, Gorny always wanted to run his own business. At 17, he ran a PC distribution service in Europe, and once he moved to the US, he joined a web hosting company called Internet Communications as one of its early members.
During his time at Internet Communications, Gorny says he had to work multiple part time jobs to make money for all the prepayments on his car and rent. But only two years later, Internet Communications got acquired by a public company called Interliant, instantly making him a 22-year old millionaire.
Flush with cash, Gorny started investing in other companies in order to further boost his net worth. The only problem: the dot-com crash and 9/11 shortly followed, wiping out most of the wealth he'd built. He was left with a car and less than $10,000 in the bank. His wife had to start working an hourly job.
"I set my goals around my net worth and that was a mistake. Everything suddenly collapsed," he said.
Making a comeback
"Immediately after I failed in 2001, I was building companies. That's the only thing I knew how to do," Gorny says.
By 2007, IPOWER became one of the bigger web hosting companies in the US and merged with Endurance International. Four years later, that company was sold for nearly $1 billion to Warburg Pincus and Goldman Sachs. Gorny was one of the largest individual shareholders at the time of the sale.
Gorny is now wealthy and successful. He's been able to launch three new companies since the sale of Endurance, including Nextiva, a startup incubator called United Web, and a web security company called Site Lock. None of the three companies have any external investors, as he's been able to bootstrap them.
"I do believe I have an interesting story. But I feel haven't done anything yet compared to what my companies will do in the future," Gorny says.
Lessons learned
Through all the ups and downs, Gorny says he was able to learn valuable life lessons that would apply to any business. Gorny narrowed it down the following six points:
- Don't have an exit strategy: You shouldn't start a business with the goal of selling the company. Instead, focus on creating real value for others. That doesn't mean you shouldn't think about selling at some point, but that should never be the focus of your business. "When I lost all my money in 2001, I completely abandoned the view of focusing on net worth. The success of a business really lies on the value it provides," he says.
- Enjoy being underestimated: Gorny started his business at a very young age, and always had a thick Eastern European accent, which made some people not take him too seriously. He says that played to his advantage and he was able to outmaneuver the people who underestimated him. "It brings a lot of advantages to businesses when people underestimate you, and in some ways, that can be a big power that can be leveraged," he says.
- Work with good people: You already have enough on your plate when you're running a business. Don't waste your time being stressed working with people you don't like. "I just want to deal with the stress of the business, I don't want to stress out over the relationship in the business," Gorny says.
- The best investment to make is in yourself: After experiencing big losses investing in other startups during the first dot-com crash, Gorny says he's become almost "overly conservative" investing in others. Instead, he spends more time finding ways to invest in himself. It's why none of his companies have external investors.
- It helps to have skin in the game: Not having external investors means Gorny put a lot of his own money into starting his businesses. Gorny believes that often helps him make better decisions, since you tend to treat your own money differently. "I make much more prudent decisions because I want to protect the downside," he says.
- Failure's like free tuition: For all the success he's enjoyed, Gorny's faced a lot of failures through his career. And he believes the failures that taught him the most lessons, which is why he tends not to celebrate his successes all too much. "You can reflect and analyze not to repeat mistakes. It's much harder to break down successes to learn how to improve," he says.