I recently went one on one with Mark E. Watson III, founder of Aquila Capital Partners. Mark previously ran two public companies.

Adam: Thanks again for taking the time to share your advice. First things first, though, I am sure readers would love to learn more about you. How did you get here? What experiences, failures, setbacks, or challenges have been most instrumental to your growth? 

Mark: I grew up with family and friends who were entrepreneurs and were always talking business. You can imagine our discussions around the dinner table! This clearly inspired me –– I was always the boy who had the paper route and I would buy candy at the drugstore and sell it to my friends for a profit at Boy Scout campouts. 

As a child, I was inspired by my grandfather’s work as a wildcatter in the oil business, and I also wanted to work on Wall Street as an investor or investment banker. So, I decided to become an investment banker in the energy sector. I bought my first stock at age 11, Walt Disney, for just a few hundred dollars. It taught me early on about investment and the different ways of earning a return on my money. Later, I was also fortunate enough to work for an energy company most of the time I was in college.

Fast forward a few years, and as I was in law school the crash of 1987 happened, and the energy industry collapsed at the same time. No one was hiring investment bankers, and no one was hiring in the oil field. It’s safe to say that my dream and career path evaporated overnight. So, I had to find another plan.

Fortunately, I had some reinsurance experience from working a summer job, and financial experience from my undergraduate degree. I found my way to New York and got a job with one of the boutique reinsurance firms at the time. I was then able to use my experience in New York to join a company, both as a minority shareholder and as an executive. I helped grow the business through a rigorous M&A program which eventually helped us take the company public. A few years later, one of our competitors appreciated the value we had created and offered us an amount of money we couldn’t refuse. 

Soon after, I decided to start my own venture firm, Aquila Capital Partners, in order to invest in early stage companies and help entrepreneurs build their own businesses. 

One of my first investments was in a publicly-traded underwriting organization that I ultimately became CEO of in 2000, just a couple of years after starting Aquila. While I knew the challenge ahead of me was sizable — having gotten to know the company as a board member — I had no idea how close the company was to insolvency.

If that wasn't enough, the September 11 attacks struck the US about a year later. Back at the office, uncertainty reigned and an existential challenge arose: how will our company survive the event, all the while helping our customers survive? It soon became clear that we needed to adapt quickly. 

Thanks to this series of exogenous events, I was reminded of the importance of vision, reinventing a company, restructuring, M&A, and later on innovation. We became very good at adapting to my environment in order to survive, which is one of the many things we now help my portfolio companies do. 

If you look at how we’ve approached investing at Aquila, we’re business leaders with hands-on experience who actually help our portfolio companies grow and develop. We don’t just write a check.

Adam: In your experience, what are the key steps to growing and scaling your business? 

Mark: It starts with having a client-centric organization with amazing products, a high-performing team, and an ability to look into the future and have a clear sense of what your company would look like if it were 10x bigger. How would that affect the product, your go-to-market strategy, your business process, the team, and so on. How would you continue to enhance your customers' experience with your products and services?

Practically speaking, it does not happen overnight and it’s certainly not accidental — You’d have to completely reinvent how you do things. 10x does not happen by incrementally growing 10 to 20% a year either, but rather by fundamentally changing things.

For example, if we take the companies I’ve been involved with so far, they’ve changed entirely in order to reach 10x: from regional to global, from 1 product to a suite of products, and from a handful of small clients to Fortune 500 clients. And of course, it’s one thing to go from $1m to $10m, from $10m to $100m or really to a billion. They all require different skill sets. 

Having the right team at the right moment in time may be the most important key to whether you succeed or not. When you are just getting a business going, it’s important to have people who are flexible and comfortable handling a broad set of responsibilities, like a Swiss army knife. You may only have a few people to handle operations, finance, accounting, HR, IT, etc. in order to keep the entire business running. 

Fast forward to when you’re looking to scale, after you’ve solidified your product, customer base, and distribution platform. That’s when you’ll need to bring in people who have domain expertise. You need more precision, more process-oriented, and expertise-oriented people.

My cardinal rule after hiring thousands of people over the years: A players hire A players, B players hire C players, and B teams never win. A players can suddenly become B players as the company evolves toward scaling, which requires an entirely different skill set. You can’t scale with the wrong people. Those who got you from 2 to 3 are not usually the ones who can get you from 4 to 10, and not bringing in new people can debilitate your organization at scale. 

Most importantly: everything has to be purposeful and strategic, not accidental.

Adam: What do you believe are the defining qualities of an effective leader? 

Mark: Effective leaders have a clear vision of what success looks like and strive towards it through preparation and practice. They are often highly resourceful people who tackle obstacles with creativity and innovative thinking.

Most of the successful leaders I know have a few similar traits in common. They are able to clearly articulate the company's mission, vision, and goals, and ensure that their team understands their role in achieving them. They display a strong sense of confidence (not arrogance), and they foster collaboration and teamwork because they recognize the importance of interdependent work.

There seems to be a common belief that people can be born a natural leader, but leadership is a learned skill. Good leaders are actually surrounded by role models and mentors who show them the way. For instance, today I’m a much better business leader than I was 25 years ago, thanks to advice from one of my advisors, Ram Charan, that I will discuss later. Surround yourself with people who can help you achieve your organization's goals better and faster. 

Adam: How can leaders and aspiring leaders take their leadership skills to the next level? 

Mark: Even if a leader is lacking one of the previously mentioned skills, a combination of experience, mentorship, continuous learning, and personal reflection can improve your ability to lead.

Also, to really level up, it's important to align your role or career with your passion. Pursue what you are truly interested in and don't just follow what others expect of you. A strong passion for your work will drive you to excel and perform your best, and likely your team will notice and be inspired as well.

The second thing is — keep learning! I’ve been learning my entire life, and I’m still learning today. Life is a journey of learning, especially for those who are intellectually curious. Those who regularly seek out learning opportunities usually become much more successful than people who do not. But knowledge for the sake of knowledge isn’t the end story, that's just entertainment –– you also have to apply what you learn and bring it to the table as a valuable skill.

Adam: What are your three best tips applicable to entrepreneurs, executives, and civic leaders?

Mark: 

1. Create value. I had always known that creating value for others — be it for customers or fellow shareholders — would also create value for myself, but it was only after going through it with some of my investments that I realized how true it was. Focusing on how you can best serve your customers and stakeholders can lead to greater opportunities for growth and success in the long term. 

2. Don’t be afraid to ask for mentorship/help. What I discovered was that first-time entrepreneurs might have a great idea, but they could still use some help to build their businesses. For instance, a lot of companies have figured out their product and maybe their go-to-market strategy, but did not necessarily understand their environment or how their competitors would react. Even further, they may need help with the 2nd and 3rd iterations of their business model, which is typically how my team and I help our portfolio companies.

3. Don’t be the hamster on the wheel for so long and suddenly wake up wondering what happened. But don’t change jobs every year either! Instead, spend some conscious time building an expertise other companies will find valuable, then find a way to exchange it for a part of the company’s ownership. Help the company grow and focus on the long-term value instead of instant paycheck. That’s the true secret to building wealth.

Adam: What is your best advice on building, leading, and managing teams? 

Mark: Leaders must shift their focus from managing to leading, and make sure their team understands and buys into the company's mission, vision, and culture. Where is the company going, why is it going where it’s going, and what can employees expect when they get there? 

This requires clear communication and a strong sense of purpose, along with the ability to inspire and motivate others to work towards a common goal. Interdependent teamwork, not just regular teamwork, is paramount, as I mentioned earlier. Everyone on your team needs to be on the same page in order to succeed.

Also, leadership in a post-pandemic world really requires us to adapt to new ways of communication and working. Leaders have the chance to leverage new tools that have emerged in recent years to work as a team more efficiently and effectively (think tools like Zoom or Slack). 

Ultimately, my best advice is to focus on both strategy and culture and stay open to adapting and evolving as the business environment changes.

Adam: What are your best tips on the topics of sales, marketing, and branding? 

Mark: I understood early on in my career that without sales, a product is useless; and without a good product, you can’t get customers to stay.

Focus on creating a high-quality product that is not only functional and meets the customer's needs, but also offers a unique value proposition that sets it apart from competitors. 

Even if you have a product that people actually want, if you can’t sell it effectively, you won’t get anywhere. Invest in effective sales and marketing strategies to reach potential customers. This rings true even in a weak economy –– when others are cutting marketing budgets, you might consider doubling down and seizing the opportunity to gain new clients. 

Build a solid relationship with your customers so that they stay engaged and connected. 

And lastly, make sure your sales strategy aligns with your brand and business goals, and regularly evaluate and refine your approach to ensure success.

Adam: What is the single best piece of advice you have ever received? 

Mark: Many years ago I received valuable advice from one of my advisors, business guru Ram Charan. He asked me a thought-provoking question: "Do you realize that if you cannot reinvent your company every few years, the market will move on without you?” I answered, “Yes, I do.” He then asked, “Do you appreciate that if you're successful in reinventing your company, but cannot reinvent yourself, you will be left behind?" He couldn’t have been more correct. His advice has stayed with me throughout my career and continues shaping my perspective on personal and professional growth.

The world is constantly changing, and businesses (and people) that cannot adapt and evolve will be left behind. 

By seeing the importance of both company-wide and personal reinvention, business leaders can stay ahead of the curve and ensure their company's success in the long term. They can also identify areas where they need to improve and develop new skills to keep up with the changing environment. Like I’ve said before, continuous improvement and adaptation is essential for success in today's world.

Adam: Is there anything else you would like to share?

Mark: We're currently at a pivotal moment in time –– the world is changing rapidly and we’re going through the Fourth Industrial Revolution, as defined by the World Economic Forum. This industrial revolution is about the integration of digital technologies into all aspects of business and society. On the business side, there are winners and losers in this current economy, and that’s being reflected in their share prices –– the winners are trading at lofty valuations and the losers keep making new 52-week lows (I’m generalizing to make a point).

So who are the winners? Companies that leverage new technologies to improve their businesses and create valuable products and services. In some industries, this has led to a winner-takes-all outcome, where a few dominant companies with strong technological capabilities are able to capture most of the market share. Amazon, Apple, and Tesla are such examples.

However, there are companies that have failed to adapt and are facing the consequences. Companies such as Kodak and Sears have been left behind as the world shifted toward digital technologies. Kodak, who actually invented the first digital camera, had the opportunity to shift toward digital photography and chose not to, and look where they are today. Sears failed to adapt to e-commerce and online shopping, and ultimately fell behind their competitors.

You don’t have to be a tech company, but being tech-enabled will get you a long way –– invest in new technologies and digital capabilities to stay competitive and succeed in the Fourth Industrial Revolution.


Adam Mendler is an entrepreneur, writer, speaker, educator, and nationally-recognized authority on leadership. Adam is the creator and host of the business and leadership podcast Thirty Minute Mentors, where he goes one on one with America's most successful people - Fortune 500 CEOs, founders of household name companies, Hall of Fame and Olympic gold medal-winning athletes, political and military leaders - for intimate half-hour conversations each week. A top leadership speaker, Adam draws upon his insights building and leading businesses and interviewing hundreds of America's top leaders as a top keynote speaker to businesses, universities, and non-profit organizations. Adam has written extensively on leadership and related topics, having authored over 70 articles published in major media outlets including Forbes, Inc. and HuffPost, and has conducted more than 500 one on one interviews with America’s top leaders through his collective media projects. Adam teaches graduate-level courses on leadership at UCLA and is an advisor to numerous companies and leaders. A Los Angeles native, Adam is a lifelong Angels fan and an avid backgammon player.

Follow Adam on Instagram and Twitter at @adammendler and on LinkedIn and listen and subscribe to Thirty Minute Mentors on your favorite podcasting app.