Hil Davis, Co-Founder of direct selling company J.Hilburn, tells his story in the February 2013 issue of Inc. magazine. Five short years ago, Davis’s wife provided the inspiration for what has become the largest seller of custom shirts in the world. In 2012, J.Hilburn reported revenue up over 100 percent versus the prior year at approximately $35 million, a salesforce of about 2,000-strong, and a salesforce annual retention rate of 87 percent.

Davis and Co-Founder Veeral Rathod both worked in investment banking before launching J.Hilburn in 2007. The article relates Davis’ not-always-smooth transition from analyzing the numbers as an equity researcher to generating the numbers at the helm of his own start-up.

In addition to its trademark custom shirts—Esquire named J.Hilburn best custom shirtmaker last year—the company has expanded its offerings to include ready-to-wear casual clothes, accessories and outerwear. When J.Hilburn style consultants gathered for their 2012 Annual Conference, the brand unveiled its latest foray into custom formalwear.

The conference also saw the launch of the J.Hilburn Style Kit, an iPad app that harnesses the power of data to offer style consultants a more efficient and personalized approach to direct selling. Among other things, the app provides measurements and purchase history for every past customer, as well as real-time inventory information on ready-to-wear stock.

With the direct selling model, J. Hilburn has brought its unique luxury branding and ambitious digital strategy into markets where few high-fashion retailers have gone before.

Read the full Inc. story here.

Click here to order the Direct Selling News issue in which this article appeared.

Photo above: ACN co-founders Tony Cupisz, Greg Provenzano, Mike Cupisz and Robert Stevanovski. Photo Credit: © 2012 Dave Moser Photography.

Company Profile

• Founded: 1993
• Headquarters: Concord, N.C.
• Executives and Co-Founders: President Greg Provenzano, Vice Presidents Mike Cupisz and Tony Cupisz, and Chairman and Vice President Robert Stevanovski
• Products: Essential services such as telecommunications and energy

Sticking to principles while adapting to rapid change is a real balancing act—one that essential services direct seller ACN has managed expertly for 20 years.

In 1993 ACN’s Co-Founders Greg Provenzano, Robert Stevanovski, Mike Cupisz and Tony Cupisz started their company as a long-distance service reseller. Their basic commitment: Put the needs of the company above their own personal needs and always do what’s best for the company’s independent business owners, or IBOs.

They literally sat down at a desk and recorded the vision they had developed through their combined decades of network marketing experience in two columns on a yellow legal pad. In column one were the best practices they had seen throughout the industry that reflected their own values—practices they knew were essential for success. Column two contained methods and procedures that, while they might be right for some, didn’t reflect the company and culture they wanted to build. Their business, they determined, would operate only in column one. And those principles from that original legal pad are what continue to drive the company today, with its original, four co-founders at the helm as they remain actively involved in all daily operations.

And growth? They weren’t focused on fast. They wanted stability and longevity. Being the best and growing in a smart way was their style. Both then and now, they have believed that, over time, sound business practices plus integrity equal strength and size.

“Don’t confuse our commitment to maintaining our original, core values to mean that we aren’t changing,” says ACN President Provenzano. “You can’t be successful in business if you aren’t willing to change, to evolve with the marketplace. So while our core values have remained the same, we continue to reinvent ourselves as a company. This means we are always reviewing our product line and our business support—asking ourselves how we can make our product offerings and the opportunity for our IBOs even better.”

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“You can’t be successful in business if you aren’t willing to change, to evolve with the marketplace.”
—Greg Provenzano, Co-Founder and President

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That flexibility has let ACN grow steadily, so much so that by the end of 2013 it expects to reach nearly three-quarters of a billion dollars in annual revenue. As the company celebrates its 20th anniversary, it now has six, state-of-the-art, world-class facilities around the globe that support and serve 23 countries on four continents: North America, Europe, The Pacific and Asia. Keeping with that original commitment to always seek out new product offerings, its initial product offering of long-distance service has expanded into a complete lineup of essential services for home and business, such as digital phone with video phone, natural gas and electricity, wireless, high-speed Internet, traditional local and long distance phone, television, home security and automation, computer support and more—services people already use and spend money on. ACN gradually reinvented itself, transforming from a long-distance company to the largest direct seller of telecommunications and essential services in the world, and the 19th largest direct seller overall.

ACN co-founders and executives present a check for over $122,000 to the Ronald McDonald House. Pictured (left to right) are Ronald McDonald; President Greg Provenzano; Executive Director of RMH of Charlotte, Mona Johnson Gibson; co-founders Tony Cupisz, Robert Stevanovski and Mike Cupisz; and VP of North American Sales, Mike Kane.

ACN’s international training events, drawing thousands of participants and hosted four times a year in North America, are a key component to the company’s training and support system.

Ahead of the Curve

Today ACN boasts a complete product lineup, providing customers with a one-stop shop for all their essential services. The founders’ desire to think outside the telecom box and add additional services has created an even more lucrative opportunity for the company’s IBOs. They believe that a consumer’s telecom services go hand in hand with their home services, creating a fantastic relationship for the company, the IBOs and their customers. But even with a robust product line, telecom will always be where their heart is. And that isn’t by accident. When asked why, Provenzano says that no matter what changes in the world, one thing would always remain the same: people’s desire and need to communicate with one another.

In fact, the December 2012 Cisco Connected World Technology Report revealed that a whopping 90 percent of young people grab their smartphone first thing in the morning, sometimes while they’re still in bed. Even before coffee, they have turned off their alarm, checked their email and text messages, and taken a quick look at social media. So there’s no denying the importance of telecom products in everyday life; and there is no denying the perfect positioning of ACN in this lucrative marketplace.

Yet while telecom continues to be the driving force behind the company, the products offered today look very different than the products of yesterday—and that has all been part of ACN’s master plan. In fact, it’s the company’s commitment to staying ahead of the curve that has allowed them to adapt and change right along with the way people communicate.

“Providing consumers with the telecom products they need and use certainly isn’t always easy, given the constant change in telecommunications. But it’s all part of the territory, and it makes for a very exciting ride,” Provenzano says. “So for us, we kept our product line flexible, ensuring it could change and adapt right along with the marketplace. For example, years ago paging was one of our leading products. But with the rise in wireless, paging began to fade away. So we said goodbye to paging and focused our efforts on where the consumer demand was going. We can’t predict what telecommunications product will be the top product another 20 years from now, but I can assure you ACN will be there offering that service to our customers—and more importantly, ACN’s IBOs will be benefiting from yet another powerful income stream, earning residual income each time their customers use that product or service.”

Comfortable Connections

But regardless of the products and services offered, the real beauty of ACN’s business model always has resided in its simplicity. As IBOs tell their friends and family about ACN’s telecommunications, energy and other offerings, the company’s essential services model gives them a comfort zone from Day One because every service is something the customer already knows about and pays for each month. IBOs don’t need to change consumers’ buying habits or get them to add to their monthly budget. They don’t have to convince someone why they need energy services or phone services. Those services are considered absolutely essential to everyone’s daily lives. And in many cases, ACN can save their customers money over what they are currently spending.

In addition, the company provides every IBO with an ACN Direct Online Store their first day in the business, personalized just for them. They simply direct customers to their online store to shop and purchase all their services. ACN handles customer provisioning, billing and back-end support. IBOs don’t need to purchase or stock products they may or may not sell. They simply direct customers to their online store. So how effective is the whole process? Consider this: ACN launched energy services in Canada in 2010 and in the United States in 2011. According to Provenzano, the company already has the largest energy footprint of any direct seller worldwide.

“The beauty of ACN is our business model and our powerful distribution system. Regardless of the product or service, when you put good things into our proven, winning business model, success naturally follows,” Provenzano says.

Total Business Support, Totally Customized

In addition to the ACN Direct Online Store, the company provides all the tools an IBO needs to be successful, regardless of background or experience. ACN offers a completely level playing field, giving anyone an opportunity to succeed. The company recognizes that IBOs almost always start their business on a part-time basis. Family, full-time careers, existing obligations and even hobbies compete for their attention. So ACN works hard to make it as simple as possible for someone to get started and experience some success immediately. But just like everything else, its business building and support systems have changed and evolved over the years, right along with technology.

“We’ve always said that what was good enough to get us here won’t be good enough to keep us here,” Provenzano says. “This also means changing and adapting to ensure we are meeting our target market head-on, in a place that is comfortable for them. For example, we got to where we are today without the use of any social media platforms. It simply wasn’t a requirement in the past. But we know that we won’t continue to grow as a company without social media, so it has become a mainstay of our communication platform.”

Communication methods have morphed to accommodate IBO habits, and today social media such as Facebook and Twitter have a central place in ACN communications.

Provenzano notes that many people expect to be able to do everything online and on their smartphone, so ACN operates a virtually paperless business. Communication methods have morphed to accommodate IBO habits, and today social media such as Facebook and Twitter have a central place in ACN communications and in building the company’s community. Provenzano says it’s all about fitting into an IBO’s life, not asking them to fit into ACN’s. Company co-founders,  executives and IBOs make heavy use of the company’s busy Facebook page, blogs and more, posting everything from encouragement and information to training, pictures and testimonials.

“Many IBOs—younger, older and everyone in between—are building their businesses without ever using a computer,” he says. “Everyone is becoming more mobile, so we have to ensure that our tools, training and back-end support can be mobile right along with them. By meeting people in a place that is comfortable to them—and a place that fits in with their busy lifestyle—we are attracting some incredible leaders who will certainly help drive our company into the future.”

Global, Gradually

ACN already has an expansive, growing global footprint. But for them, international expansion is a careful, methodical process.

“Our expansion philosophy has always been about exercising caution and restraint, to not strike until the iron is hot, per se,” Provenzano notes. “We want to ensure that when we launch a country, not only is ACN ready, positioned with the right products and services, but also that the market is ready for ACN. We see no need in launching a new country unless we are 100 percent confident that the launch, and more importantly our business operations for the long-term, will be a success—and timing plays an incredible part in determining that success.”

Country No. 23 was Korea. Although still in its infancy stage there, ACN has already become a powerhouse in Korea, rapidly growing into the premier direct seller in a short amount of time. Yet Provenzano says the company has barely scratched the surface of the Asian marketplace. In addition, with a strong foundation of Latino leadership already in place in North America, ACN is looking forward to launching Latin America, where Provenzano describes the opportunity as “truly limitless.”

Events: The “Secret Sauce” in ACN’s Recipe for Success

ACN’s large-scale quarterly events represent an essential component to the company’s success system, which is why event after event, year after year, IBOs turn out in droves for its events. Almost 20,000 of them from around the world flocked to ACN’s hometown of Charlotte, N.C., for the company’s International Training Event in late September, and they continue to host sold-out events quarter after quarter.

Regardless of when or where the events are held, they draw impressive crowds of people who come together for a weekend of recognition and training and to hear from renowned guest speakers such as John Maxwell, Donald Trump and Darren Hardy, just to name a few. The events have become the place to be for IBOs. More than just a place to spend the weekend, ACN’s events represent a powerful business-building tool.

“It’s not a coincidence that the top people in ACN never miss an event,” Provenzano observes. “We hold them quarterly and they truly provide the motivation and fuel our IBOs need to build their businesses. For a brand-new person, there is nothing quite as powerful as walking into an arena of 20,000 excited, supportive IBOs. It truly is the best way to be exposed to our opportunity and to see the big picture of ACN firsthand.”

ACN expects more big numbers when it celebrates its 20th anniversary at its annual convention, also in Charlotte, this month. This event will kick off a full year of anniversary celebrations. Provenzano was keeping the details a secret when he spoke with Direct Selling News in December, but he said that 2013 will be about reflecting on the company’s last 20 years, where it has come from, and celebrating what is to come. He is excited about the anniversary and the success it represents, but he is much more focused on the future. After all, there are still many more countries ACN has its sights set on for future expansion.

“ACN is growing in every way,” he says. “We have more IBOs today, more satisfied customers enjoying a more robust product offering across four continents. Not to mention, we are well on our way to being a billion-dollar company. For many new companies, where ACN is today is a dream; but for us, this is only the beginning. Every milestone we reached is just another beginning for us. There are still so many people who have yet to ever hear of ACN. And at ACN, finished never is.”

To learn more about ACN’s home-based business opportunity, visit www.acninc.com

To learn more about ACN’s products and services, visit www.myacn.com

Click here to read this issue’s Top Desk with Greg Provenzano.

Click here to order the Direct Selling News issue in which this article appeared.

Company Profile:

• Founded: Sept. 21, 2012
• Headquarters: Bellevue, Wash.
• Founder: CEO Ryan Wuerch
• Products: Mobile phone service

Ryan Wuerch wants to make life better for millions of people.

“I am not looking to turn a few people into millionaires. I want to empower millions of people to become thousandaires,” he says. “And I believe that the way to do so is by making commerce less expensive and even profitable for everyone involved.”

Ryan Wuerch

Wuerch is Founder and CEO of Solavei, a company that is pioneering what he calls “social commerce.” In many ways, the concept is at the heart of the direct selling model—avoid spending billions of dollars on traditional advertising, and instead move it into the hands of the people who use the products.

“The growth of direct selling is one of the most significant trends hitting the global economy. I see one of the main challenges in the industry to be the reliance on products that could be seen as unnecessary or as a luxury. That can make repeat sales a challenge in some cases,” Wuerch says. To differentiate itself, Solavei is focusing on a service that customers are already using to connect themselves every day—mobile phones.

Mobilizing a Movement

“A recent study reported that most people would prefer to leave home without their wallet than without their cellphone. These devices have become a part of our DNA, an expression of who we are,” Wuerch says. He adds that there are more than 300 million cellphones in the United States today, and he projects that there will be more than 6 billion cellphones around the world very soon.

Of course, the telecom industry is also one of the most capital-intensive and hotly contested markets in the world. This can be a very tough environment for a startup to survive, particularly when the industry is dominated by a handful of extremely well-capitalized corporate giants.

For example, the top two wireless service providers—AT&T and Verizon—have a combined advertising budget of more than $5 billion per year. While that would intimidate many less experienced entrepreneurs, Wuerch believes this actually provides a tremendous advantage for his new company. He sees those advertising budgets as a billion dollars he doesn’t have to spend, since Solavei wants to invest its resources in what he calls the “best form of advertising—satisfied customers.”

“At Solavei, we empower our customers with low-cost alternatives for the services that they are already using and make it easy for them to share Solavei with others,” Wuerch says.

The approach seems to be working. Solavei launched on Sept. 21, 2012; within 90 days the company had more than 110,000 members in the United States sign up for $49 per month for unlimited voice, text and data mobile service.

“This year we will begin to expand globally. We will also expand our platform to carry multiple products and services in addition to mobile phones. We anticipate millions of new members joining.”

Aligning the Trends

Before launching Solavei, Wuerch had spent nearly two decades in the telecom and technology industries. After several successful exits from earlier ventures, he founded and built his last company, Motricity, into a firm with more than a billion-dollar market cap before he parted in 2011.

When he left Motricity, he told his wife Shawntel—the former 1996 Miss America winner who is now Solavei’s Head of Community Affairs—that he wanted to do something different with his next venture. He wanted to find a way to make a difference.

Wuerch went away for a few weeks to study the major trends that he saw shaping the future, and he landed on four that he saw as underpinning economic growth around the world.

1. The worst economic conditions since the Great Depression, which was driving people to focus more and more on saving money. This also was leading to the creation of entirely new companies, such as Groupon, to capitalize on this drive.
2. The rising dominance of social media within so many people’s lives, which was creating an explosion in the number of active relationships between people.
3. The surge of mobile device usage, driving an incredible number of innovations in not only communication but commerce, banking and more.
4. The continued growth of the direct selling industry despite the economic downturn. In particular, he was struck by the rapid rise of outside investments in new direct selling companies like Stella & Dot, Ambit and Ignite.

While studying these trends, he also perceived tremendous waste in the “shotgun approach” represented by the $500 billion spent each year on traditional advertising.

Solavei is a company leveraging the power of social media and direct selling to help people save money on their mobile service while avoiding the heavy advertising costs typical within the mobile industry.

As he studied these trends, he saw an opportunity to align them within a single company, leveraging the power of social media and direct selling to help people save money on their mobile service while avoiding the heavy advertising costs typical within the mobile industry.

“Solavei is positioned to positively impact people without changing their behavior or their environment,” Wuerch says. He explains that the company’s name is a combination of words meaning “sun in your veins,” a metaphor for the powerful opportunity that Solavei seeks to provide to its members.

Investors have put more than $20 million into Solavei so far, allowing it to attract a top-tier management team with experience at major corporations across the country, as well as a former U.S. congressman. Key positions are now held by former executives from T-Mobile as well as Wuerch’s last mobile services company, Motricity.

A New Approach to Compensation

Solavei’s initial service is a $49/month mobile plan that includes unlimited voice, data and text messages. The service is built on the backbone of T-Mobile’s infrastructure, providing customers with leading 4G services at a fraction of the cost of other providers.

Even if they are only interested in purchasing the cellphone service and have no intention to recruit others, all customers are eligible to become independent distributors (whom the company calls “members”). They receive a personalized URL on the Solavei.com website that they can easily share on their social networks, or they can even adapt a Solavei-themed WordPress template for their own Custom URL.

The goal is to make the Solavei service one of the easiest sales to make in the direct selling industry, explains Wuerch. He says that the average time for a new member to transfer their phone service, enroll in their social community and establish their banking relationship using the Solavei enrollment process is less than 6 minutes and 26 seconds.

In addition to removing as many barriers as possible for their members to close a deal, Solavei has developed a patented compensation plan based on social graph theory—primarily, by focusing on points of three within each person’s massive and growing network of social relationships. These focal points, or “trios,” serve as the essential building blocks for the Solavei direct sales program.

“We do not consider ourselves a multi-level marketing company,” says Jason Genthner, Head of Corporate Communications. “Our members are not paid on multi-levels as traditional MLM companies operate. We pay on who they bring in, who those people then bring in, and then on the entire network that they build.”

The primary way that members earn money is in $20/month increments for every trio that they successfully bring into the system. This allows them to essentially have free cellphone service with only a handful of successful recruits, explains Genthner.

Members can also earn “Fast Action Bonuses” for new recruits added within the first 60 days. These one-time bonuses are $50 for the first four trios (enough to pay the full cost of a brand-new smartphone). Additional payment structures include “Path Pay,” a monthly payment for those who have recruited at least four other trios (ranging from $50 up to $20,000 per month); members also earn a one-time payment of these same amounts when they enter a new Path, called a Path Bonus. The compensation plan is based on each phone in the plan, therefore, many members are building more than one business.

“We think a person’s voice is the most powerful form of marketing, so that’s what we want to invest in. While other companies spend billions on traditional marketing, we reward our members for sharing Solavei with their connections,” Genthner says.

But one of the most revolutionary aspects of Solavei has nothing to do with its mobile service offering or its compensation plan. Rather, it is with the method of its biweekly payments to members. Rather than sending them checks, Solavei pays its members through a Solavei card that was developed in partnership with Bank of America to work like a Visa debit card.

“Our vision is to create our own economy,” Wuerch says.

Social Commerce

What makes this concept so revolutionary is that it allows Solavei to essentially control a significant portion of their members’ “mobile wallets.” Through incentives offered to members, these funds can then be directed toward purchases within the Solavei marketplace—allowing the company to pay its members for the everyday purchases of goods and services.

This is all in line with Wuerch’s goal to make commerce less expensive for consumers as well as more profitable for companies. This platform provides Solavei with an opportunity to harness the collective purchasing power of their members to attract deals from other vendors in a similar fashion to Costco. For example, Solavei members could receive a payment of the percentage of the money spent by members at a retailer such as Target. 

“You make money through Solavei, you then save money through purchases in the Solavei marketplace and those purchases then also help you to make even more money,” explains Wuerch.

He also notes that many of these purchases are being made using a Solavei mobile phone and are then being shared using the company’s social technology. The end result is that Solavei becomes deeply embedded within its members’ social and economic lives, making it even easier for them to share the Solavei opportunity with others.

More Than Mobile Phones: The Future of Solavei

Mobile phones are merely the starting place for Solavei, Wuerch says.

“Mobile is the first of many, because it provides an immediate economic and communication conduit to our members. We anticipate that we will soon broaden Solavei from just mobile services to include energy, insurance, financial services… essentially, any of the primary items that you already have as a share of your wallet today.”

In other words, Wuerch never intends for Solavei to sell you anything. Rather, it will provide you with a better deal on the things that you are already buying consistently—and also provide you an opportunity to generate income.

“We will only consider goods and services that everyone uses and that Solavei can offer for less, generally by eliminating the costs of advertising. We started with mobile and created the social commerce system that would work with all goods and services. This is similar to Amazon starting out with books, but ultimately creating an online distribution system to offer many products. Future Solavei offerings must be the kind of services/products that can be easily shared in a social environment and must have an opportunity to create income for the members.”

In its first few months of operations, the company has already received endorsements from celebrities such as Stephen Baldwin—whose video testimonials about the product are already gaining significant exposure for the company on Facebook and other social media sites. Wuerch says that Solavei has never paid for such endorsements, which are being offered because of what these high-profile figures believe that Solavei can do for everyone.

When asked about the future of his company, Wuerch is optimistic: “We are building what we anticipate to be a multi-billion-dollar company. We have spent millions on branding to give people confidence in our brand, and we have built a strong patent-protected technology into a social commerce platform that is irrespective of geography and currency. Solavei is built for global scale.”

According to the Center for Disease Control and Prevention, a whopping 68.5 percent of Americans are overweight or obese, and it doesn’t look like the younger generations will grow up to decrease that percentage, as they are already entering adolescence with significant weight problems of their own.

According to Pew and Nielsen surveys, another group of Americans—nearly 50 percent, in fact—carry smartphones. What do these two groups have in common? A cross section of these groups, those who want to manage their weight and own a smartphone, are the target audience of Vemma’s new free app, Bod-e.

Chris and Heidi Powell, celebrity TV weight-loss coaches, are featured in the app as personal coaches. Vemma and Chris Powell developed the weight-loss plan around his New York Times best-selling book.

The app’s many features are a perfect fit for Gen Ys, with a constant stream of video messages from the trainers and a progress tracker with a weekly progress photo upload. Messaging and photo-sharing make up two of a smartphone user’s most common activities. Users determine when they want to be reminded, and the app sends reminders throughout each day to keep participants motivated, engaged and on track.

While Vemma hopes to increase both its number of customers and brand partners with the app, Vemma Founder and CEO BK Boreyko points out that the app has value, whether or not the Bod-e products are purchased. Features include reminders of what and when to eat, recipes and an option to “favorite” them, a grocery list builder, and two Gen Y favorites: a fast-food menu that lists the “carb-cycle approved” menu items from the top 20 restaurant chains and social media sharing support on Facebook and Twitter.

Boreyko says, “We’re betting people will fall in love with this app and the lifestyle Chris and Heidi Powell are known for. If any of our Bod-e products or our new Chris Powell Bod-e Shake can help them get to their goals faster, everybody wins!”

The app also directly benefits Vemma brand partners with its sampling program, which is tied to social sharing. Partners can send tweets and make posts that offer friends a free Vemma Bod-e shake along with Chris Powell’s Top 10 Weight-Loss Tips DVD, and an invitation to download the app. The prospect pays $4.95 shipping and handling. Everything is “hands free, fee free” for the brand partner as Vemma fulfills the sample package and notifies the partner with a push notification when it’s received.

Having already won numerous awards, the Bod-e App is available as a free download for iPhone and Android, and is yet another way that direct sellers can leverage mobile technology to help people reach their goals.