Striking Out On Your Own

When Lynda Resnick brings her own water to an interview, she really brings her own. That is, when she produces a bottle of Fiji, she owns the entire company—as well as POM Wonderful, maker of pomegranate juice and antioxidant supplements. She's a serial entrepreneur who also owns the Teleflora floral service and a number of other ventures. Resnick's new book, Rubies in the Orchard, details a lifetime acquiring businesses and transforming them with a keen eye for value, marketing and community. The writing can be flat—especially compared with how charismatic Resnick is in person—but the ideas are so sound, and the track record so full of success, that the book is still a fun read, and highly instructive to anyone wishing to start a business in these bleak times. Resnick spoke to NEWSWEEK's Nick Summers about the Bush administration's economic legacy, balancing risk with reward and why now is a great time to be running your own business. Excerpts:

How long were you working on the book?
Of course it took me my whole life, but six months. I turned in the manuscript, and my editor said it was the cleanest he'd ever seen. I thought, "Is that a compliment?" The corrections took about half an hour; that was it. There was a page and a half that he took out that was a little too strident.

What was it strident about?
I get carried away. The Bush administration—I was hysterical during the entire eight years. Beating my chest, crying, screaming at the television. I saw the end. I did. I have a Cassandra complex. Do you know who Cassandra was?

I do!
And do you know what happened when she broke up with Apollo, what he did to her?

I don't.
He gave her the gift of prophesy, but made it so that no one would believe her.

So you saw the end—of what?
I didn't see the debacle the way it is today, but I did—every time the stock market went up another 300 points, I would get sick. I was very upset, because I've lived through so many bubbles. I knew that there was no way that this was going to last. You can't expect to make 20 percent a year, year in and year out.

Why did you write the book? Who was the target audience?
I wrote it, I hope, for small- to medium-size businesses, although Wall Street could learn a lot from it. But alas, will they? I talk about the tyranny of instant gratification that our country has gone through over the last 20 years. Running companies for quarterly profits is not a long-term game, as we've seen. So my concept is, if you have a product or business or service, you have to make sure you have true intrinsic value in what you're selling. You have to figure out where that value resides—is it your technology, is it some invention that you've made? Is it the fact that your water fell as rain 200 years ago? Is it the fact that your pomegranate has healing properties?

Then communicate that value. You have to have a unique selling proposition, something that sets you apart from the other people in your realm. If you're a dry cleaner, is your front office as pristine as the clothes you're returning? If it's a movie theater, maybe it's an art theater, showing films that they can't get somewhere else?
Community and transparency can level the playing field. Small businesses are not burdened with the overhead and the debt of a big business—they can zoom in with their disruptive technology and take over. There was no chance for small business up until recently; it was very hard to come to market with your new idea. Nobody was interested; they wanted to write fancy derivatives and instruments that were going to make it quick on Wall Street. But today there's a real opening, and it's a good day for small business.

So there's reason for optimism, for entrepreneurs with an idea for a business? And what about taking risks in general?
What do they have to lose? They may as well go for it. They're not going to see another opening like this. Investing in your own business is what we've always done; we've never been a public company. Who are you going to believe in more than yourself?

Now, I disagree that we should be spending. I'm not, and believe me, I love to. Now I'm very cautious about what I'm buying. I used to buy at the auction houses all the time. We have a big art collection, but I'm not doing it, man. I don't need it. I don't need another thing. Cash is king. If we start saving, we may be able to finance our own future. So it's OK, pull in your belt a little bit.