Like many entrepreneurs, Mike Novak went into business for himself at a young age. He was 28. That was 30 years ago. To begin his journey, Novak first had to go in the wrong direction and experience the corporate world to know it wasn’t where he wanted to stay.
The entrepreneurial spirit first showed itself in Novak while he was a St. Mary’s University student taking classes taught by then Business School Dean, Brother Paul Goelz. “Paul Goelz taught his students there are three types of freedoms. The first is personal freedom – that speaks for itself. The second is religious freedom – that speaks for itself. And the third is economic freedom. Economic freedom has everything to do with our free enterprise system in the U.S. It’s that fundamental freedom that we’re allowed to exercise in the capital markets to take the risk and create things. In the history of our country, economic freedom has created our standard of living.”
While a student, Novak had interned with an industrial construction company. When he reached graduation, the company offered him an opportunity to take over a project in the Virgin Islands. “So there I was,” he said, “starving to death, facing three years of law school, tired of being a student, and ready to get out there and mix it up. I went to St. Croix for two years and had my first exposure to an international culture. You take a Texas boy that’s not been out of the state except to the Mexican border, put him in the Caribbean, and soon you discover you don’t have to have blinders on – there are no boundaries with an entrepreneurial spirit. When I came back from the Virgin Islands I managed another couple of projects in the U.S. By then, it was tearing me up inside. There was no way I could work for another company, I needed to have my shot – it was that spirit,” declared Novak.
Novak started CCI, a niche construction firm, in 1980. Over the next 25 years, CCI had operations in North, Central and South America specializing in design and construction services in challenging geographical locations. By 2005, he was ready to move on, and he sold CCI. “I’ve always preferred having a boutique company, otherwise you create these monsters and you have to feed them. It doesn’t take too long for an entrepreneur to find he’s no longer doing what he really enjoys. Pretty soon you’re managing personnel issues and managing your executive team, and that’s OK – you have to do that, but that’s not why I started it in the first place,” observed Novak.
After selling CCI in 2005, it didn’t take too long for the spirit to again give rise to another company. The Novak Group began the following year – this time with Mike and his sons Lucas and Josh eventually joining him. “Where I’m having a lot of fun is testing my sons to see if they have the spirit to be successful,” said Novak. Novak insisted both sons work for big companies before creating the family business. “My middle son was recruited into business right out of the A&M Master’s program. He needed to understand how it feels on the other side of the fence – that’s when the spirit starts to kick in. He was moving quickly up the ranks, and they were pitching him about the future and a fabulous career. He didn’t want to be 30 years with a predictable progression. He was getting antsy; he wanted to get out and do what I’ve done. It was the same with my youngest boy – he was recruited right out of Baylor. After he did five years, and learned that business and excelled with them, he couldn’t stand it. He said, “‘Dad, I don’t want to be a corporate monkey,’” said Novak.
The Novak Group creates energy solutions and handles construction management. Lucas Novak runs the energy side and his brother Josh Novak runs the construction operation. As they were formulating plans, Novak sat both sons down separately and together in his role as part mentor, part father, and part CEO. “I told them this is not an easy road,” said Novak, “and I don’t know if you’ve got the spirit. I have a window of about eight years to help you develop your spirit and help you get to where you want to go.”
The conversation continued into Novak’s biggest concern, “In a family business you have balancing time with your own family, and have to learn how to keep your priorities straight.” To make sure both Lucas and Josh began their commitments with clear understanding of the relationship, Novak created a memorandum of understanding for everyone to sign. Acknowledged Novak, “If there was any family conflict, either internally within their family, or between the brothers, or between the brothers and me, I wanted to remind them about what we talked about. It’s not legally binding, but it’s a compass that can bring you back to the basics.” Novak continued: “It’s not that I anticipate business disagreements with them, it’s my concern about keeping the family values primary. It’s that foundation. It’s Maslow’s hierarchy of need. If that pyramid gets out of whack, the whole thing crumbles.”
And what does Mike Novak want to share with his peer CEO’s? “It’s always about the people – not the logo, not the brand, but the people. It’s about keeping people in harmony and moving toward a common objective, and keeping them excited about the possibilities.” Novak advised, “Be careful how you measure your success. At a public company you’re measured by cash flow, bottom line, year over year increases, sales – and I’m not saying that’s not important. Let’s say you’re at retirement and looking back on your life and somebody asks, ‘What do you want on your tombstone?’ Do you want, ‘I had 22 years of constant EBITDA growth?’ Contrast that with, ‘I used God’s gift to the best of my ability to serve others.’”
Novak regularly returns to the classroom at St. Mary’s to talk with current students about what it takes to be an entrepreneur. “A program or a school or a university – they can’t create entrepreneurs, it’s an inter-born spirit – either you have it or you don’t. What they can do is help you develop that spirit and understand that gift,” observed Novak.
Links to accompanying bootstrapping articles: