Kip Tindell, the CEO of the Container Store, is featured in a Bloomberg Business article that looks at the tensions publicly-held businesses face between principles based on some form of mutuality and demands made by investors.
The Container Store's was launched in 1978, and was privately held (in partnership with a PE firm) until late 2013. It has operated from the beginning with a conscious capitalism business model that is summed up this way:
- Pay employees well and treat them with respect
- Consider suppliers and customers as family
- Have fun
However, by 2013 Tindell was was looking for ways to fund expansion to smaller markets, and to increase employee stock ownership options. He decided to take the company public.
In the lead up to the company's IPO, Tindell told his executives that he hoped to get along well with shareholders, and that he'd prefer long-term investors over short-term ones. But on a public exchange, you can't pick who buys your shares.
If you retrieve your lure too fast you’ll never catch any fish. It’s stunning how slow you have to go. If you think you’re fishing slowly enough, fish half again slower, and you’ll catch many more.”
Since the IPO, Tindell has taken heat for not being aggressive enough on costs -- including employee salaries -- and not moving fast enough to shore up profit margins. He is standing on his principles for now, and hoping his shareholders will see the value in the long game.
Image source: Bloomberg Business
-- Clara Shen