October 29 -- UW-Whitewater alumnus Aaron Jagdfeld has reached the heights that many people only dream of.
Jagdfeld, CEO of Generac, is a Milwaukee
native who graduated from UW-Whitewater in 1993 with an accounting degree. He
started his career at the public accounting firm, Deloitte. After spending a
year in public accounting, he decided to join Generac.
He held different positions in the accounting
department at Generac, and moved his way up to becoming the Chief Financial
Officer (CFO) of the company. He became the CEO in 2008. Jagdfeld was
recognized by Forbes magazine as one of America’s 20 most powerful
entrepreneurs under 40 years of age.
He was invited by UW-Whitewater Innovation
Center to talk about his journey and the story of Generac.
History of Generac
Generac is a manufacturing company that
primarily manufactures residential, commercial and industrial products. It was
the first to “engineer” home standby generators and is now the number one
manufacturer of home backup generators, according to its website.
The company was founded by Bob Kern in 1959,
who led the company until it was sold in 2006. He retired when he was 82 years
old, Jagdfeld said.
Generac had humble beginnings, according to
Jagdfeld. When Kern started the business, he was unable to pay the rent of the
building, which got him evicted off the facility. He then moved to a different
location to operate his business.
The company saw several bumps in the road
even decades after its founding. Kern faced financial troubles during the early
’80s. He told Jagdfeld that he had less money in 1982, than he had in 1959 when
he started the company.
Despite difficulties, Kern did not give up.
He had a “never say die attitude” which kept him going, Jagdfeld said.
“He was in his 50s and he didn’t give up; it
would have been easy to take a job at Walmart or something, but he didn’t
give up on it, and 30 years later his business is worth $2 billion,” Jagdfeld
said.
“When I started the company we had 80 million
dollars in sales, we had about 250 employees and that’s very different from
today,” Jagdfeld said.
Generac operates with 3,400 employees and
billions in sales.
Success strategy of
Generac
Jagdfeld credits two things to Generac’s
success: Innovation and acquisitions.
“You have got to constantly reinvent
yourself, Jagdfeld said. “Just having one idea is a great way to start, but
it’s not a very good way to finish.”
Generac was operated “organically” under
Kern, according to Jagdfeld. The company did not do acquisitions until 2011.
“We turned to acquisitions to really broaden
our portfolio, broaden the markets we are involved with, broaden our geographic
scope which is really hard to do organically,” Jagdfeld said. “It’s one thing
to grow organically in the U.S. it’s another thing to try and to grow
organically in Europe, China, India, Italy or elsewhere.”
Jagdfeld emphasized that the key to a
company’s success is continuous innovation.
“The reason we got to $2 billion was not
because of the products we made in ’50s, it wasn’t because of the products in
’60s, ’70s or the ’80s; it was new products all the time,” Jagdfeld said.
He also said Generac follows a strategy
called “Powering Ahead” which has been the basis for his company’s growth for
the past 4 years.
“If you want your employees, your suppliers,
your customers, your investors to understand what it is that you are doing, you
have to be able to give your elevator speech,” Jagdfeld said. “You have 30
seconds to tell them what your strategy is and so the key to that is keeping
the strategy very simple but broad enough that allows you enough flexibility to
be able to grow organically and in our case inorganically through
acquisitions.”
He said he tells his employees that if they
start getting tired of hearing his strategy, it means it’s working.
Secret of Jagdfeld’s
success
Success
is hard work and having a strong work ethic. He said he strongly believes in
making his own luck.
Jagdfeld said it was “cool” to receive
recognition from Forbes, but there is one other achievement he is very proud
of.
The alum was also a Track and Field athlete
at UW-W, which he still values to this day.
“The only award I would say probably rivals
that [Forbes] is the my Whitewater Athletic Achievement award,” Jagdfeld said.
“I had a decent career. It was cool to be able to have that kind of recognition
from the athletic department here.”
He said most sports in college are all-year
round, incuding track, and being able to balance sports with college and
succeed at both is more of a challenge than one thinks.
Jagdfeld said his comapny has recently bought
a facility in Oshkosh. It has also acquired a facility in Nebraska, South
Dakota, and Georgia.
Generac has plants in foreign countries such
as Brazil, Italy and United Kingdom too.
“We are starting to expand our business
outside of USA, but those are only about 14 percent of our revenues outside
North America,” Jagdfeld said. “We have a long way to go to be a really, truly
international business, but we are acquiring our way there and kind of growing
into that.”
Jagdfeld said the company was made public in
2010 and is now traded on New York Stock Exchange.
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