Friday Fails: Maria Erna Explores Failure in Business
Dusty Weis:
Greetings innovators, and welcome to Back of the Napkin, where we explore big journeys in the world of small business, with the personalities who make it happen. And welcome back to another of these short segments that we've taken to calling Friday Fails. I'm Dusty Weis, along with Stephanie Davis. And Steph, we're doing this segment because failure is very much stigmatized in the world of business and we think that it's about time that changed.
Stephanie Davis:
They call it the school of hard knocks for a reason, Dusty. While it might not be fun to fall on your face, it's also very often the quickest way to learn an important lesson, and here at SurePayroll, we want to embrace the value of learning through failure, which is why we make a point of sharing stories like the one we have today.
Dusty Weis:
In episode two of this podcast, we were introduced to Maria Erna, who owns a holistic spa and grooming shop for dogs in Salem, New Hampshire. She was a lot of fun to talk to and had some great advice for small business owners as well.
Stephanie Davis:
But she also shared a story from long before she launched WaG Grooming Salon and Spa, and I think it's safe to say, she's got a degree from the school of hard knocks.
Maria Erna:
I think failure is always an effective teacher. I've had many failures, but I always had the insight to look at them as lessons. I started a business right when I got out of high school, the summer between high school and college. I was working at The Retailer and I started a party planning business that I thought was such a unique opportunity, and this was early '80s. And what we did was, you would call me to plan your party, your children's birthday party, you could plan anything, and I would bring in the catering, the decorations, the staff, the food, the music, entertainment, everything that you needed. We did it all.
Maria Erna:
I even had a smart business model. I wanted to go out and I just outsource all of it. I made a deal with all of the contractors where you would charge the customer the same price as if they went to you directly, but you're going to give me 10% cut back of what you make. You're going to build that in, and then I would charge the customer a 10% fee on top of it, so that I made this profit. So if it was a $5,000 party, I would make $500 off the top, and then just under that from everybody that I outsourced to. I would give them and make them my premier contractor for these events.
Maria Erna:
Well, I put a little ad in the paper with a 10% off coupon, and I never put an expiration date on it. And then I did this really big party. I was 18 and young and stupid. The kegs got there late, the caterer was on time, the tents didn't show up, until everything just started snowballing. The best part of the service is we came in the next day and we cleaned everything out for you, and that's when we would get paid. We would clean up after the mess. So you wanted to have ponies or whatever, we do it all and then we cleaned it up, so I brought everybody.
Maria Erna:
Next day, I go in, we clean it all up. I go in, sit down with this woman to settle up and she was a very affluent woman, and I was a very poor kid with a lot of ambition, and I needed to collect my check so that I could then in turn checks to all of the vendors I brought in. I brought in this amazing seafood company that did lobsters and clam chowder, and all of this, they catered. I had the liquor companies that I had to pay. I had to pay the DJ. I had to pay the company that brought in the parquet floor because this was outdoors on a beach up here in new England. We had bartenders there on staff, servers, hors d'oeuvres, things like that. All outdoors. Party tents set up.
Maria Erna:
The next day we're cleaning it all out, everything's gone. I meet her back at her home. That was her summer home. She had a home closer to, I think Andover, Mass. Went and sat in her office with her to collect my payment. As I gave her the bill, I went right down to the wire because I took a lot of money off and she handed me that 10% off coupon, on a very expensive party and I lost my butt.
Stephanie Davis:
So Maria, thinking back on that moment, how did it feel to know that you weren't going to make a profit on that? Walk me through what you were feeling.
Maria Erna:
I'm a person of my word. I could have probably fought and said, "Oh, well you had to tell me about that when you booked the party and you didn't," but I believe in what goes around, comes around. And we have a saying we say at Wag about, "Don't do anything [inaudible 00:04:10]. It's bad juju because it'll come back to you." We talk about bad Juju all the time. I believed in it, I just never used that term back then. So I didn't fight her. I just remember tears welling up in my eyes because I knew that I had to pay all of these people. It was a $15,000 party back in the '80s. You can imagine what a soiree it was. And I'm about to take a $1,500 hit, and I don't have that money. I'm 18 years old. I just looked at her and I said, "Okay, we'll just deduct it."
Maria Erna:
I went and I paid everyone that I could, and I lucked out that a couple of people were friends. I knew the DJ and I knew the caterer, and so they allowed me to pay them on a payment basis, and that was it. But I remember just going home so defeated. I can still feel it right now because I take a lot of pride in what I do, and when I screw up, it hurts. When people yell at you about stuff, you just look back at them like, "You're a jerk." When you disappoint someone, it's such a harsh feeling and I was so disappointed in myself. But yeah, I lost my tail on it. I had just moved out into my little apartment.
Maria Erna:
I'll tell you a story, it goes back to my dog. I had my rescue dog. It was a German shepherd mix and we didn't have food or anything. I'm trying to make it. I already grew up poor and I didn't want to be poor anymore. I wanted to just make enough to survive and be able to help these things out. I had a little pack of M&Ms, and there were two M&Ms left in it. I dropped one on the floor, and the dog dove for it and I dove for it. And you're not supposed to give your dogs chocolate because it's horrible, but I let my dog have it. It was one M&M, so before PITA comes after me. But I remember that being the lowest point of I lost everything. I had nothing and my only dinner that night was going to be this damn M&M, and I gave it to my dog.
Maria Erna:
Lesson learned, that you put expiration dates on offers that you put out there and you know how they're going to apply and you build in for that. That was probably one of my biggest ones that I learned a lesson from. And then of course, later on I learned, when I had my marketing consulting firm, when I started, I started the year before September 11th happened. Everything was abundant. Things were going great. And September 11th happened and the first thing that my clients cut were their marketing budget. I learned two lessons on that. One is that, I had a staff to take care of at that point, so that was really hard when we had to lay off people. And second, I learned that, I'm going to just say it in plain English, I think one of the dumbest things any company can do in a recession or in a bad time is to stop your marketing and advertising. Because if you have a good product and you stop telling people about it, they're not going to remember you when everything turns around, and everything does turn around. History happens in cycles.
Maria Erna:
Now, with social media, you have no excuse not to continue marketing because you don't have to go for paid advertising and radio and things like that. You can use the free resources until you're abundant again, and then invest in those other resources and learn what works for you. I know Facebook is our number one draw, and then Google searches because people go out there and put those reviews. There's other medium out there for social media that doesn't work as well for us. We stay out there because you have to, and I want to keep the handle, and I don't want to lose that leverage there, but learn what works for you. Put mechanisms in place and track it.
Dusty Weis:
I think it's really interesting that you bring up that period following September 11th, because I was interviewing a pretty influential marketing business owner earlier this year. He mentioned the start of the great recession of 2008 as a moment that really allowed him to refine the idea that he had, crystallized it, and then push forward with it with renewed vigor because it wasn't like he had clients banging down his door, trying to get his attention. He had nothing but time to focus on this new idea. And it became a multi-tens-of-millions of dollars brand for him.
Dusty Weis:
Take us back to that moment in the wake of September 11th, and the economic turmoil that followed that, because I think that there are a lot of small business owners right now who are standing here looking at the economic turmoil in the wake of the pandemic. How did you take your idea for a small business at that stage in your career, and really advance it in spite of the economic headwinds that you were facing?
Maria Erna:
It's funny that you brought up 2008, and it ties together because what happened in 2001 directly impacted me in 2008. At that point, I scaled down my consulting firm. I've always kept it. I've had it all those years since 2000. It's Emmy Management, Maria Erna Management, and I'll keep it forever because I always find people that need help along the way and I'll continue to do so.
Maria Erna:
But after all of that kind of crumbled, I was fortunate enough to get a position with a real estate development company, doing consulting for them. They had just experienced the brunt of September 11th, and they wanted some marketing, and I went in and did that. One of the requirements of the job, and this was based out of Atlanta, was to get my real estate license. Didn't even know that was a thing. I always pictured real estate agents as old, whatever. I get my real estate license, learn about real estate law, I do the job well. I go into land development, learn all about acquiring land and how they develop subdivisions and shopping centers and things like that. Never gave up my real estate license. I ended up when I finished that consulting position, I started selling real estate in Georgia as a side thing to supplement when my consulting business was up and down.
Maria Erna:
The advice I can give to entrepreneurs is something that I mentioned earlier on, is that, have a side hustle. You can do two things at once. What's that saying? You don't go to sleep when you're tired. You to go to sleep when you're done. I don't sleep a lot because I'm up worrying about my staff and what I can do better. But when I was in Georgia, I got my real estate license and then 2008 happened, the real estate bust. I never sold a property that people still didn't have equity in, so I didn't overprice homes. I always maintain a level of ethics, and as a realtor, you have a higher level of ethics to subscribe to. It helped me in everything else because location, location, right? So now it helps me learning where locations are.
Maria Erna:
I got through 2008 and when I came back to New England in 2014, I found out that Georgia was a reciprocal state for real estate licensing, so I had to take the state portion of the exam because the real estate laws are very, very similar. So now I'm licensed in New Hampshire and Georgia, and I still sell real estate. I don't have to take money out of Wag. I can make money off of real estate while I keep putting all my profits back into Wag, to build it and give back to these girls and buy the equipment that they need, and expand the way we need to and things like that.
Maria Erna:
Do what you need to make your money, and then find something that you love. And I'll tell you, if people are ever looking for a career, it's very inexpensive to get into, but you've got to be committed. You've got to be a hustler. Real estate, if high had known how lucrative real estate was, I would have never gone to college. I would've got my real estate license as soon as I turned 18 years old, and I would have had huge pieces of land all over the place and put rescue animals on them. Right back to my dogs, saving those dogs and cats, and horses, and anything else that I could put on land.
Dusty Weis:
Well, that's the dream hustle. I've just got to say, if I'm crystallizing three lessons that I heard from you there, it's A, never stop learning, B, don't be afraid to reinvent yourself and C, sleep when you're dead.
Maria Erna:
Exactly. I used to say that on my trips to Vegas, "I'll sleep when I'm dead."
Stephanie Davis:
What a moment that must've been for Maria, not only feeling like she'd failed, but really just seeming to hit bottom and feel so taken advantage of too.
Dusty Weis:
Failures like that offer, I'd say, not just an important lesson, but also an exercise in resilience. Once you get a few of those under your belt as a business owner, you start to realize that there's nothing so terrible that you can't make a recovery, if you're willing to do the work and if you've got good people around you. If you want to hear more about Maria and Wag Grooming Salon and Spa, check it out on the podcast feed and make sure to check in with us again soon. We'll have more full episodes and more Friday Fails coming out on a regular basis.
Stephanie Davis:
So please make sure you're subscribed in your favorite podcast app. And if you enjoyed the show, leave us a five-star rating or even a review. We would love to hear from you about any ideas you have for small business owners, who we should be featuring on the show.
Dusty Weis:
Back of the Napkin is brought to you by SurePayroll, where small business is their business. From easy online payroll, to 401k support and award-winning customer service, SurePayroll has been serving the payroll and business needs of small businesses for more than 20 years. Learn more at shorepayroll.com and get two months free as a new customer.
Stephanie Davis:
Here on Back of the Napkin, our executive producer is my boss, SurePayroll's Cary Streets. Co-producers are Kevin Aubrey, Ashley Peterson, and Dave Papa, and our production partners are Podcamp Media.
Dusty Weis:
Where we provide branded podcast production services for businesses. Our editor and producer is Larry Kilgore, III. Thanks for tuning in to Back of the Napkin. I'm Dusty Weis.
Stephanie Davis:
And I'm Stephanie Davis.
