The world can tick off the conventional standards that define Adam Anderson’s story of success – founder of a multimillion-dollar cybersecurity tech company in Greenville, scholar in residence at Clemson University’s business program, community volunteer, all balanced with being a husband and father and youth soccer coach.
But it doesn’t end there.
In fact, Anderson said he’s more interested in talking about the businesses he’s failed at.
All 12 of them.
To the tune of $2 million altogether.
Because, in lieu of finishing college, these have been the learning experiences that help inform his entrepreneurial worldview.
Anderson started his second venture – Palmetto Security Group, a firm that assesses cybersecurity threats for businesses and sells IBM products to provide tech solutions – 11 years ago in Greenville.
It’s still running strong today, employing 40 and offering the chance for an employee to make six figures without a college degree.
The $25 million in revenue generated has been the funding source behind his other ideas.
The first to fail was Dragonfly Jewelry, an online silver jewelry business that he said was going to be “so cool.”
Then Rock n’ Roll Knives, billed as a “dangerous steak knife” set.
There was the Internet café with 25 computers and five Xboxes, where kids would pay by the hour.
And so on.
“I should be very wealthy right now, but I’ve used all of my cash to launch other businesses to learn all this craft,” said Anderson, who lives in Simpsonville with his wife, Kerry, son Kenton, daughter Eva and niece Harmony. “Maybe I should have finished college, but this has just been a fantastic learning experience. Every company is teaching me a different emotional lesson.”
The emotional experience is where Anderson said he derives and measures his success – money is merely a vehicle to implementing a vision, ideas are good only if they connect with people.
This philosophy is one he hopes will make his 14th venture a second lasting success.
But it’s an idea without a customer – at least not one yet.
‘It’s OK to be a beginner’
Anderson grew up a military brat, really from no place in particular.
The family was at Disney World when his father, Robert, was called to Iraq in the Desert Shield campaign and was employed in psychological warfare. Robert used his understanding of human behavior to contribute to the war effort – advising on the leaflets dropped into Iraq – and to help combatants and hostages re-acclimate once fighting was done.
One task was to assess the morale of a unit. The common metric was how healthy the unit’s sense of humor was. Humor is built into Anderson’s work culture.
Anderson’s mother, Bonnie, was accepted into the nuclear engineering program at Northwestern University but declined and became a teacher, working in U.S. Department of Defense schools for 35 years.
Every Friday, Anderson and his father eat at the same place, Lieu’s Bistro, and talk about life.
“What I learned from my parents is that it’s OK to be a beginner,” he said. “You don’t get intimidated by starting things. You take your first step even if you don’t know what your second step will be.”
In 1998, Anderson dropped out of the University of Utah where he had attended on a music scholarship with plans to become an architect. Dyslexic and ADHD, school in the traditional sense wasn’t for him. He instead opted for mentoring and independent research.
Anderson pursued certification as a software engineer and used his knowledge to help protect a bank from the Y2K bug. When the new millennium came and passed, he found himself looking for a new challenge.
He came to Greenville and ultimately worked for IBM, gaining experience in the software business.
In 2005 – after the failed online jewelry business – Anderson cashed in his 401(k) and started Palmetto Software Group (he changed to the current name two years ago).
The main business, which is now run by a CEO and does the vast majority of business with Dutch clients, has been the source of funding for Anderson’s entrepreneurial adventures.
The dangerous steak knives idea was inspired by a friend, Barry Kerch, a drummer in the rock band Shinedown. When not touring or recording, Kerch liked to cook and wanted to start a business. The knives were to be created by a weapon designer who worked on the “Lord of the Rings” franchise. The blade would blend seamlessly, and dangerously, with the handle.
“We almost ordered 60,000 knives from China without any idea how to sell them,” Anderson said. “I realized I had no idea how to sell them and we would just have a lot of Christmas gifts for the rest of our lives.”
The Internet cafe brought in $3,000 per month. It cost $14,000 a month to run.
“It was exactly what I thought it needed to be, but completely different than what the customer wanted,” he said.
A new approach
Anderson’s latest venture – Atlas Vault – is built around the concept of how human behavior interacts with technology, Anderson said. Use of humor and self-deprecation to make human connections aside, he said he sees this as his next big business and focus for the coming year.
“I don’t think of myself necessarily as a tech entrepreneur,” he said. “What’s really fascinating to me is understanding human behavior and seeing how business and technology can combine to get some kind of result.”
The Atlas Vault product would essentially be the Turbo Tax of cybersecurity, he said, providing an affordable, easy-to-use tool for small businesses to assess their protection against cyber attacks.
The cost for protection can be too steep for small businesses, if they even concern themselves with the issue, Anderson said.
“It’s fight or flight right now,” he said. “It’s not a conscious decision to ignore it. Nobody has the ability to fight, so everyone is just in flight. The big security risk is the human being. When companies begin thinking of cybersecurity as a technology problem and not a human problem, you can spend millions of dollars and then somebody clicks on a link they’re not supposed to.”
Some simply buy what’s sold to them, thinking a $30,000 product will be a silver bullet but within six months is out of date, he said.
This affects their ability to work with larger companies that have more resources to protect against threats and demand more security from their smaller partners who will handle client information, he said.
“It’s the same way as me being terrified and intimidated by a complicated tax code,” Anderson said. “I hire a professional to help me with that. Now people are dealing with complicated cybersecurity standards and compliances, not to mention the fact that there are nation-states attacking, and they have no idea where to start.”
This time around, Anderson said he tried his hand at raising money to get a business off the ground.
He said he learned quickly that venture capitalists and angel investors don’t care about how good an idea is. They care about likelihood of big returns.
“It was the worst experience ever,” Anderson said. “We didn’t raise anything. There’s this myth that if you have a good idea you can go out and get money. No one cares about the idea. What they care about is can you execute, can you prove there’s a track record and that you’ve got traction.”
“It’ll be an interesting local experiment,” he said. “I’ll see if it works.”
‘Success in life is not dollar bills’
Adam has taken his passion for entrepreneurship beyond the task of implementing business ideas to learning and charity.
He’s currently a scholar in residence for Clemson University’s business school. He helps mentor and consult both in the university’s Center for Corporate Learning and the Clemson MBA in Entrepreneurship and Innovation.
Or, as he said, it makes him “sound like a guy who can’t get a job but thinks deep thoughts. They use me how they want, and I get to play with all the toys.”
The MBAe program helps aspiring entrepreneurs to understand starting their own business and helps get their project going. Successful graduates are offered the opportunity to apply for free work in start-up incubator in the ONE building downtown. MBA students pair with mentors like Anderson.
The Center for Corporate Learning is the former PACE program, originally set up in the 1950s for the textile industry. When the program underwent a reinvention during the Great Recession, Anderson was a key adviser, said Nan Johnston, the center’s director.”
The willingness to try and fail set him apart, she said.
“Because Adam is a serial entrepreneur, he’s thought a lot about what works in business, and what could be better,” Johnston said. “He was happy to help me, and we talked through a lot of problems and ideas. His input has really been invaluable.”
Central to his lesson to aspiring entrepreneurs is to not focus on making money as the end goal.
Troubled to learn that veterans returning home from war couldn’t get jobs, Anderson brainstormed an idea that would train them in cyber work. He had the funding, a partnership with Greenville Tech. But again, he learned that he had created a solution but hadn’t thought through how to connect with the people who had the problem.
Instead, he has joined Apparo, a non-profit that helps other charitable organizations improve their efforts through better understanding and use of technology. He and his employees work with Habitat for Humanity, Junior Achievement, Goodwill and others. He’s currently mentoring three Carolina High students who say they want to build software companies.
It’s another lesson, both in marketing and aspiring to create venture that isn’t designed around a sole mission to make money.
He tells this to any young entrepreneur with a good idea, such as a person with a dream to start a brewery. If your passion is to brew beer, you need to be willing not to draw a salary and to practically live at your workplace.
“Success in life is not dollar bills,” he said. “Success is impact on people, impact in your community. It’s what you are doing relationshipwise. Money isn’t really good or evil, it’s just something that you have. If I’m doing good works and I’m providing real value that people need, the money will come. If I’m not, I don’t deserve the money.”
Anderson’s strategy to go all-in only after making a series of small bets. Try to avoid building the prototype first, start on paper.
Most of all, don’t be afraid to fail.
“You have to delude yourself to think it’s going to be great, otherwise you’d never get started,” he said. “This is the reality distortion field. You have the ability to distort reality based on what you want to see happen, and most entrepreneurs have the ability to expand that field around them.”
But one disclaimer, with requisite humor:
“Apparently, there’s another class of human beings who have this distortion field,” he said. “It’s called cult leader.”