Mr. Dreiske, as lenders called him, understood what most well educated, small and family owned business people do not understand. Debt is a necessary evil to be paid off as soon as physically possible. Don always paid his people fairly and on time. However, he paid himself when he needed to. By that I mean, most of the cash generated from his businesses went back into the business especially towards loans. He loved to pay cash and, if he had to borrow, he loved to pay it off as agreed and, usually, as fast as he could.
He was amazing in his ability to tell a property with potential from a bad one. As soon as he heard about the possibility of a property being on the market, he was on it. Lots of times, he got the deal because he had CASH! Imagine that. If he did not have all the cash he needed plus the cash he was going to need for the next 6 months or so, he borrowed. Banks and insurance companies lined up to loan to him. For two primary reasons: 1. He always paid as agreed or better, and 2. they trusted that if he wanted a property, or business, or whatever, he knew what he was doing. Did he ever miss? Sure, but rarely. And when he did miss, he did the right thing always. Fix it up and sell it OR sell as soon as possible to avoid increased exposure.
Don did take care of his managers and top management staff. Not outrageously like today, but adequately and sometimes surprisingly. Once when I was in financial trouble, he showed up at my office with a check, a large check. I told him thanks and how would I pay it back. He said not to worry. Get on my feet because I would do the same for him if I could. You know what? I would. I would do whatever I could if he needed anything. Businesswise or otherwise.
What do you think now?
Wednesday, August 19, 2009
Thursday, August 13, 2009
DRD continued
Don is a very, very tough businessman in the sense that he very seldom, maybe never, just bought something. Almost always he got bids or checked prices at several places before buying anything. And, he taught us to do the same. Once when he was overseas, we had an inspection at a property and got in trouble for not having a First Aide Kit. So, I bought one from Zee Medical, a well known brand name. When the bill came in after he got back, I thought I was going to loose my job because he knew of at least 3 other places that had basically the same thing cheaper. I never made that mistake again. I may have had the degree but he had the brains for business. That is not to say he did everything on the cheap. On the contrary, he knew what he wanted and looked around until he found it at a good price.
Once we went to a hotel/motel auction in a very nice but relatively small town in Oklahoma. He always was in a position of strength at an auction because he had cash to back up his bid and could prove it to the auction people. He bid and won the property. As soon as the bidding was over a man came over and offered him $50,000 for the contract. Don did it on the spot. I told him that he was passing up a good deal the property could be really good. He said, "But I have $50,000 right now and I know that is good"! I learned a valuable lesson, never be greedy. He was never greedy in anything, Even when selling properties, he tried to make the best deal that he could and then he would sell. Some people might have said he could get more, but he knew what he needed and probably what he wanted to spend on a new property and would list the property and sell it and never look back.
Don, bless him, had the crassest, crudest mouth anywhere. His reputation was for being a jerk, being fowl mouthed and for being crude to everyone. But you should have seen him in action around people he needed to influence and people he respected very highly. I told him once that when you swear like he did, nobody listened to what he said only how he said it. He said that was pure BS and then proceeded to get a call from the President of Holiday Inn because he sat on their advisory board, and he was amazing and oozed confidence and knowledge about their product and what was in development. Although he was never short of crass joke or two, people in high places had learned that it was just Don and, usually, did not take offense. Sometimes they did. I never heard him apologize. Did that keep him from doing deals. I do not think so. In the 27 years I have known Don, I have seen some really upset people especially lenders. But you know what? They lived with it, generally, because they knew that no matter what, they would be paid and paid on time. Usually, almost always, loans were paid off early.
Another thing. Don required accurate books and as much automation as possible. In an era when computers were relatively new, Don wanted to latest and the best. He wanted accounting and management software that was really good and comprehensive. He wanted numbers when he wanted numbers so he could apply his "Rules of Thumb" daily, sometimes hourly. He was really ahead of his time in that regard. The same with CPA's, attorney's and insurance people. They were advisers. They did not tell him (and do not tell me) how to run his business. He would always ask if what he was doing was legal, moral and ethical and if if was, even if it walked the edge of envelope, he did it. He was right. Those guys give great advice but none of them could run a real business and usually could not run their own. Sorry for you guys out there doing those jobs, but it is the truth!
What do you think now?
Once we went to a hotel/motel auction in a very nice but relatively small town in Oklahoma. He always was in a position of strength at an auction because he had cash to back up his bid and could prove it to the auction people. He bid and won the property. As soon as the bidding was over a man came over and offered him $50,000 for the contract. Don did it on the spot. I told him that he was passing up a good deal the property could be really good. He said, "But I have $50,000 right now and I know that is good"! I learned a valuable lesson, never be greedy. He was never greedy in anything, Even when selling properties, he tried to make the best deal that he could and then he would sell. Some people might have said he could get more, but he knew what he needed and probably what he wanted to spend on a new property and would list the property and sell it and never look back.
Don, bless him, had the crassest, crudest mouth anywhere. His reputation was for being a jerk, being fowl mouthed and for being crude to everyone. But you should have seen him in action around people he needed to influence and people he respected very highly. I told him once that when you swear like he did, nobody listened to what he said only how he said it. He said that was pure BS and then proceeded to get a call from the President of Holiday Inn because he sat on their advisory board, and he was amazing and oozed confidence and knowledge about their product and what was in development. Although he was never short of crass joke or two, people in high places had learned that it was just Don and, usually, did not take offense. Sometimes they did. I never heard him apologize. Did that keep him from doing deals. I do not think so. In the 27 years I have known Don, I have seen some really upset people especially lenders. But you know what? They lived with it, generally, because they knew that no matter what, they would be paid and paid on time. Usually, almost always, loans were paid off early.
Another thing. Don required accurate books and as much automation as possible. In an era when computers were relatively new, Don wanted to latest and the best. He wanted accounting and management software that was really good and comprehensive. He wanted numbers when he wanted numbers so he could apply his "Rules of Thumb" daily, sometimes hourly. He was really ahead of his time in that regard. The same with CPA's, attorney's and insurance people. They were advisers. They did not tell him (and do not tell me) how to run his business. He would always ask if what he was doing was legal, moral and ethical and if if was, even if it walked the edge of envelope, he did it. He was right. Those guys give great advice but none of them could run a real business and usually could not run their own. Sorry for you guys out there doing those jobs, but it is the truth!
What do you think now?
Monday, August 10, 2009
Don Dreiske the businessman
Don's business philosophy was simple. Make money, lots of money!Do it with integrity, do it with the help of your team, take care of the little guy, BUT make money no matter what. He once told me that money is all that matters. Make money. And he did. His properties were better than most, more up-to-date than most, cleaner than most, the food was better than most and his General Managers were more scared than most. It was a good scared or a bad scared depending on the GM and if he was meeting the objective Don (and only Don) had set for him
He had these Rules of Thumb. Maids cost should be a certain percent of room revenue. Food should be a certain percent of food revenue. Payroll should be a certain percent, management a certain percent, maintenance a certain percent, etc. Amazingly, almost incredibly, he was spot on, dead right. If those numbers did not come in, the GM (or those in corporate office) had big time explaining to do. The GM's were always amazed that he knew as much about their property as they did. You know why? Because he, basically, left them alone to run the property as they agreed. Did he talk to them? Every day! Every single day, no matter what. Sometimes about the numbers, sometimes about their people, but every day. And most of all, he controlled the purse strings tightly yet evenhandedly (is that a word?). No one had authority to spend over $100 without Don knowing about it (unless there was an emergency and even then after cell phones were popular). Really! And, if your numbers reflected the percentages according to his Rules of Thumb, maybe no questions were asked.
And, if the property did well, guess who Don took on a cruise to celebrate. The maids and waiters and waitresses. Management from other properties would come in when they were on the cruise and fill in until they got back. There were people on those cruises that had never been out of their hometown. Do you think that might be what endeared the "little guy" him and virtually eliminated turnover. Interesting. It is not that GM's didn't get rewarded. They did. They got to keep their jobs!
What do you think so far?
He had these Rules of Thumb. Maids cost should be a certain percent of room revenue. Food should be a certain percent of food revenue. Payroll should be a certain percent, management a certain percent, maintenance a certain percent, etc. Amazingly, almost incredibly, he was spot on, dead right. If those numbers did not come in, the GM (or those in corporate office) had big time explaining to do. The GM's were always amazed that he knew as much about their property as they did. You know why? Because he, basically, left them alone to run the property as they agreed. Did he talk to them? Every day! Every single day, no matter what. Sometimes about the numbers, sometimes about their people, but every day. And most of all, he controlled the purse strings tightly yet evenhandedly (is that a word?). No one had authority to spend over $100 without Don knowing about it (unless there was an emergency and even then after cell phones were popular). Really! And, if your numbers reflected the percentages according to his Rules of Thumb, maybe no questions were asked.
And, if the property did well, guess who Don took on a cruise to celebrate. The maids and waiters and waitresses. Management from other properties would come in when they were on the cruise and fill in until they got back. There were people on those cruises that had never been out of their hometown. Do you think that might be what endeared the "little guy" him and virtually eliminated turnover. Interesting. It is not that GM's didn't get rewarded. They did. They got to keep their jobs!
What do you think so far?
Thursday, August 6, 2009
Don Dreiske is the Man!
You are probably asking yourself, "Who is the heck is Don Dreiske"? Well in the next 2 or 3 posts I am going to tell you. Today it will be about how I met him. Next, Don in business and lastly, Don personal life.
Don Dreiske is a self made man. More about that later. I had never heard of him in my life until I was introduced to him when I was a Mortgage Broker/Mortgage company owner. He was the owner of a few motels and the one he had in Norman, Oklahoma needed to be refinanced. He had his corporate headquarters in that Ramada Inn and was an up and coming hotel owner. I was looking for people who needed financing and he needed financing and we hit it off. We were and are very different people. He was getting rich, I wasn't. He was a self made businessman, I was trying to be. He was a highly knowledgeable hotel/motel person, I was not. He drove a BMW, I drove a Cougar.He was not well educated, I was. He walked the edge of envelope in everything, I did not like to be "out there".He was extremely business smart and I was a novice. He was mean and I was nice (or so I thought). I was a Christian, he was not. But we both had one thing in common. Nothing.
When I met him at his property, he bought me lunch. The restaurant (Kathie's after his wife Kathy) was exceptional. There was a real chef, outstanding food, it was very clean and it was very well run. We talked about his property and his plans for the future and what he needed in financing. We talked about family and cars, traveling and people, and financial information on the property. He was very open and very knowledgeable. As a Mortgage Broker, you are always trying to get the information you need for your package to send to prospective lenders and you are always fixated on having the client sign an agreement so that you get paid. I asked Don to sign the contract and he said we did not need one. He told me that as long as I was doing what I said, he would do what he said and for some reason I believed him. As a Mortgage Broker it is important to get them locked up in that you do not want others looking at the deal or the client talking to others while you are trying to make the deal. Don said he would not do that and he did not.
So here I go on the adventure of a lifetime. Just by meeting this one guy, it changed my life forever. Not as life changing as coming to know Jesus Christ as my savior or meeting my wife, but life changing nonetheless especially in the business sense. Little did I know what was in store for me in the future. It was an amazing partnership. We still talk today and a are good friends. If I ever needed anything, I would never hesitate to contact Don. And yes, I did arrange the requisite financing and yes I got paid. Most of the time you make sure that when the loan closes, your fee is on the closing statement. Don paid me before closing!
What do you think so far?
Don Dreiske is a self made man. More about that later. I had never heard of him in my life until I was introduced to him when I was a Mortgage Broker/Mortgage company owner. He was the owner of a few motels and the one he had in Norman, Oklahoma needed to be refinanced. He had his corporate headquarters in that Ramada Inn and was an up and coming hotel owner. I was looking for people who needed financing and he needed financing and we hit it off. We were and are very different people. He was getting rich, I wasn't. He was a self made businessman, I was trying to be. He was a highly knowledgeable hotel/motel person, I was not. He drove a BMW, I drove a Cougar.He was not well educated, I was. He walked the edge of envelope in everything, I did not like to be "out there".He was extremely business smart and I was a novice. He was mean and I was nice (or so I thought). I was a Christian, he was not. But we both had one thing in common. Nothing.
When I met him at his property, he bought me lunch. The restaurant (Kathie's after his wife Kathy) was exceptional. There was a real chef, outstanding food, it was very clean and it was very well run. We talked about his property and his plans for the future and what he needed in financing. We talked about family and cars, traveling and people, and financial information on the property. He was very open and very knowledgeable. As a Mortgage Broker, you are always trying to get the information you need for your package to send to prospective lenders and you are always fixated on having the client sign an agreement so that you get paid. I asked Don to sign the contract and he said we did not need one. He told me that as long as I was doing what I said, he would do what he said and for some reason I believed him. As a Mortgage Broker it is important to get them locked up in that you do not want others looking at the deal or the client talking to others while you are trying to make the deal. Don said he would not do that and he did not.
So here I go on the adventure of a lifetime. Just by meeting this one guy, it changed my life forever. Not as life changing as coming to know Jesus Christ as my savior or meeting my wife, but life changing nonetheless especially in the business sense. Little did I know what was in store for me in the future. It was an amazing partnership. We still talk today and a are good friends. If I ever needed anything, I would never hesitate to contact Don. And yes, I did arrange the requisite financing and yes I got paid. Most of the time you make sure that when the loan closes, your fee is on the closing statement. Don paid me before closing!
What do you think so far?
Saturday, August 1, 2009
Cash for Clunkers.
You are, by now, well informed on the governments "Cash for Clunkers" program where you can get up to $4500 if you trade in your old car and buy a brand new one. President Obama's idea on how to jump start the car industry after gifting GM and Chrysler with a speedy bankruptcy and money that, I bet, will never be paid back in full.
Be that as it may, this program appears to be working and the government is going to throw more money at it. For you Small and Family Owned Business owners, I would like to propose a new government program. Cash for Whatever! If what should be done to make the economy right is throw money at it, they why not just throw some to small businesses who need to get jump started again. Or, give them money if they have too much debt and it would be better if they didn't so lets eliminate their debt and make the banks suck it up.
It aggravates the snot out me that Washington is now mad at the salaries and bonuses paid to banks that were in trouble. I am not. Several of them have paid back their TARP funds (a few were not allowed to pay back the money because the government deemed them to not have enough equity if they paid back the money. And of course we know that he government is the best person to determine how solid a bank is and to establish equity requirements.) and are now profitable and the government doesn't like it one bit. Do you know why the banks are paying it back faster than first thought? Because they are risk takers every time they make a loan and they are doing that. Because they do not want the eyes of the government controlling them and limiting their pay. As long as they have TARP funds, salaries at the top are limited. And lastly, because they are creative business people who understood that the economic situation was not a depression or even near one and they just pulled up their boot straps and did what they had to do. One bank I read about, took their recent profits and divided equally to all their employees. How novel. Lincoln Electric has been doing that for years.
What does that have to do with Cash for Clunkers? I am not sure but I decided to rant about it.
What do you think?
Be that as it may, this program appears to be working and the government is going to throw more money at it. For you Small and Family Owned Business owners, I would like to propose a new government program. Cash for Whatever! If what should be done to make the economy right is throw money at it, they why not just throw some to small businesses who need to get jump started again. Or, give them money if they have too much debt and it would be better if they didn't so lets eliminate their debt and make the banks suck it up.
It aggravates the snot out me that Washington is now mad at the salaries and bonuses paid to banks that were in trouble. I am not. Several of them have paid back their TARP funds (a few were not allowed to pay back the money because the government deemed them to not have enough equity if they paid back the money. And of course we know that he government is the best person to determine how solid a bank is and to establish equity requirements.) and are now profitable and the government doesn't like it one bit. Do you know why the banks are paying it back faster than first thought? Because they are risk takers every time they make a loan and they are doing that. Because they do not want the eyes of the government controlling them and limiting their pay. As long as they have TARP funds, salaries at the top are limited. And lastly, because they are creative business people who understood that the economic situation was not a depression or even near one and they just pulled up their boot straps and did what they had to do. One bank I read about, took their recent profits and divided equally to all their employees. How novel. Lincoln Electric has been doing that for years.
What does that have to do with Cash for Clunkers? I am not sure but I decided to rant about it.
What do you think?
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