Sounders boss Adrian Hanauer on startups, success, soccer |
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Sounders FC owners Joe Roth, left, and Adrian Hanauer. Photo/Sounders
Sounders FC boss Adrian Hanauer -- who has dabbled in startup investing and whose family made a bundle when Microsoft acquired aQuantive for $6 billion -- is now at the helm of what has to be one of the biggest startup success stories of the year. As the general manager and co-owner of the Seattle Sounders FC soccer club, Hanauer has masterfully guided the team to unprecedented heights in its first year.
The Sounders won the U.S. Open Cup in September, and they are the first expansion team in Major League Soccer to make the playoffs since 1998. Every home game sells out. And hundreds of passionate fans -- wearing team scarves and Xbox 360 jerseys -- chant and sing as they participate in the raucous March to the Match.
But Hanauer -- a Seattle native who co-owns the team with comedian Drew Carey and Hollywood producer Joe Roth -- used a different sports metaphor to describe the team's achievements in remarks earlier this week to a group of venture capitalists and tech executives.
"By any stretch, humbly, it sort of has been knocked out of the park," said Hanauer. "And I've been involved in a lot of startups in retail, manufacturing, technology, restaurants and now sports, and I know how rare those knocks out of the ballpark are."
Hanauer had some other interesting things to say about running startups in a talk this week at OVP Venture Partners' annual CEO Night. (Turns out the OVP Managing Director Chad Waite is a huge soccer fan, attending games in London at Arsenal and Tottenham as well as his fair share of Sounders matches)
Hanauer and the rest of the Sounders management, however, are not sitting back. Instead, they are taking a page out of former Intel CEO Andy Grove's philosophy of only the paranoid survive.
"We are extremely grateful and humbled by that (success) and obviously wake up every morning paranoid that it is going to go away," said Hanauer. "That's what sort of drives us at this point because we are sort of getting past that startup phase, and now we are in the place where we have to sustain our business."
Hanauer said the team made some smart decisions along the way -- hiring people like goalkeeper Kasey Keller, announcer Kevin Calabro and coach Sigi Schmid. But he also stressed the importance of luck and timing -- citing as one example the departure of the Seattle SuperSonics.
In a lot of ways, Hanauer said the success of the Sounders has been a "perfect storm." And at some point during the season, he said the momentum took over and it became his job to simply "get out of the way" instead of "actively managing."
But that success didn't come easy. And like most entrepreneurs, Hanauer also showed dogged determination.
As the owner of the minor league Sounders through the 90s and up until a MLS franchise was awarded to the city, Hanauer struggled to keep the team relevant to sports fans.
"One thing I learned ... is that a minor league sport in a major league city doesn't work very well," he said. "And we got killed year after year after year, but kind of kept the flame alive in Seattle."
That flame is now burning brightly, especially as the team heads to Houston to face off against the Dynamo at noon Sunday in the final leg of the playoff series.
Fredy Montero hugs Adrian Hanauer after the Sounders victory in the U.S. Open Cup. Photo/Sounders FC
One other key factor in the team's early success -- and a good tip for entrepreneurs in any line of business -- was the importance of partnering. The Sounders early on lined up with Paul Allen's Vulcan Sports and Entertainment, a partnership that allowed the team to inherit the sports management infrastructure of the Seattle Seahawks.
"We basically went into this soccer enterprise with the best business management team -- if not in professional sports -- certainly in professional soccer," he said. "It gave us a huge kickstart and advantage."
And then there's Drew Carey. The Price is Right host made it a point of making sure that the organization involved fans -- the ultimate customers -- in the process. That included the ability for fans to vote on the general manager's job.
"Luckily, I am an owner too," said Hanauer to laughs. "For fans to be a customer of any sport and to know that they have some ability to influence the future and influence the company is in my mind a good thing."
And there's one other thing that's obviously driving the success: superstitions.
Hanauer offered some of the irrational habits of players and coaches, which may have indirectly led to the team's winning ways.
--The assistant coaches after a win don't wash their polo shirts until a loss.
--Head coach Sigi Schmid eats one even cup of pistachios before each game.
--Striker Fredy Montero switched to wearing two different colored shoes because he wasn't scoring goals.
--And Hanauer? He's decided not to cut his hair until the team loses.
Given Hanauer's success this year, there may be some other entrepreneurs in town who start growing out their locks.
Luck. Timing. Determination. And -- maybe, yes maybe even a slight dose of superstition-- have made the Sounders the envy of professional soccer in the U.S.
"I didn't want to come in and try to presume to give anyone advice about how to do a startup," Hanauer concluded. "But, as is typically the case, the success usually comes from a whole bunch of different areas. It is always more complicated than anyone sees from the outside."
John Cook is co-founder and executive editor of TechFlash. He has been covering the technology beat for nearly a decade, writing about startups, entrepreneurs and venture capital, most recently serving as a reporter/blogger at the Seattle Post-Intelligencer.
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