Tom Nolan 0:00 

What we see is a byproduct of caring about our customer, like our customers, our boss right like if we don't treat her the right way, if we don't make decisions based on that person the right way, then we lose. And with that mentality, it's how we approach everything. So retail thinks about it that way. And as a result of that, we have about as high a conversion rate as you can have in the consumer retail world. I mean, our conversion rates and our best stores are north of 40% and that's unheard of, and it's because we don't focus on it like you know. The irony is, we focus on making connection with somebody, and it works.

David Novak 0:39 

Welcome to How leaders lead. I'm David Novak, and every week I have conversations with the best leaders in the world to help you become the best leader that you can be. Today, I'm sitting down with Tom Nolan, the CEO of Kendra Scott, a popular jewelry brand that's been crushing it lately, 44 months of nearly double digit growth. And guess what? Tom's been the CEO for 45 of those months. So yeah, this guy knows how to get results. But here's the thing, Tom's not the kind of leader who bulldozes his way to the top. For him, it's all about making real connections with his team and his customers, and when you focus on that, the results tend to take care of themselves. This episode might just be the mindset shift that you need to start building those connections and getting real results. So here's my conversation with my good friend and soon to be yours. Tom Nolan, you

you know, when we first met, we talked about our mutual belief in the power of recognition. That, when did you get sold on, on recognition, you know, as a real business driver, tell us a story. Well,

Tom Nolan 1:56 

I mean, look, I would say just as a, as a, as a young person growing up in business, I always felt like I had a voice and wasn't always heard, right? So I when it was heard, it made me feel really good. I think it started probably before that, just playing sports as a kid, you know, everybody wants to get an attaboy, and they made me feel really good. And then, then I read it, read a great book called, oh, great one somebody wrote, and, you know, that one really solidified it for me, and I, I started making it I've always, I think, made it a fundamental part of kind of how I've parented my kids, how I've led in business. Then that book, and I'm not pandering you, but really, that book kind of changed how I thought about it internally at our company, Kendra Scott, and we incorporated recognition in a way where, you know, on a weekly basis now, I asked for getting who's who's doing a great job, that we could just give a high five. And because it's so important, people work really, really hard, as you know, David and a lot of the times, and most of the times, I think, for the right kind of people, what motivates them isn't money, it's knowing that they're doing a great job and the feedback of that. So I knew how important it was to me. I've seen how important it is as a dad to my kids, and it's, it's really proven and paid high dividends in our organization. You

David Novak 3:09 

have one of the most original CEO personal recognition awards that I've ever seen. You know, tell us about it.

Tom Nolan 3:18 

Yeah, I literally, it was, it was after I read your book, I and the jar. I mean, we so I read a book called The Way of the shepherd a long time ago, and it it really changed how I how I led. I mean, I consider myself a servant leader. And you know, when you first become a leader of people, it's scary. So somebody gave me this book when my first first real management role, and it really just talks about how to be a servant leader. And kind of the thesis for the book. And I would suggest everybody read it. It doesn't take very long to read. It's a short little book. There's not as many short

David Novak 3:51 

books I read it after you told me, but go ahead, there's not

Tom Nolan 3:55 

as many pictures in it as most of the books I like to read. But you know, this, this one worked out great. So it but the thesis of it really is, it's a guy going to business school, ironically, in my hometown, here, of Austin, Texas, at UT, and he's studying how to be a leader in business school, in McCombs business school. And he has this great professor, and the professor has agreed to give him kind of on the side, coaching and leadership advice. And he's so excited about he gets all ready, and he puts on his best penny loafers. The professor says he's gonna come pick him up on the weekend, and he shows up, and the professor's wearing basically cowboy clothes, and he doesn't take him to get a Business Symposium. In fact, he takes him out to his ranch and he helps him herd sheep, because the guy was a shepherd. So it goes through all of this to really understand like to be a great Shepherd, you know, you got to understand that the shape of your flock, each one of your sheep individually, and it's all about servant leadership, and the shepherd's crook, which we all know, is a symbol of that and it sometimes the shepherd's crook is used to wrap a sheep on the head when it's doing something stupid. Sometimes it's used to save a sheep if it's fallen in a hole. Other times, it's used. To protect it from a coyote or something. So I've told a lot of people about this book. I've given out a lot of copies of it over the years. So as a wonderful recognition for me, I've gotten beautiful shepherds crooks over the years from different people, my very favorite one. So we had a problem at Kendra Scott, not a problem. Was an opportunity, I guess, where I felt like we had this great business performance, but I don't think we were recognizing people as much as we could have, and listening to what you talked about, you had to give something that meant something to you and not expect anything back. So we created a recognition vehicle. I took my the absolute favorite shepherd's crook I've ever gotten. It's about a 250 year old shepherd's crook from Ireland, and I brought it into our office, and I basically said, Look, this is going to be a recognition vehicle that we use in our organization. And there's a couple things that need to happen. The first thing is, I'm going to identify it, to give it to somebody, and it's going to be somebody that exemplifies servant leadership and how we like to operate here as an organization, and your job, once you have it, is to identify who's going to get it next, and then leave your mark on it yourself. So the first time I gave this out to somebody, it was an individual in our IT department, and he was a quiet guy, but he really exemplified everything that, you know, he was not not looking for anything. Specifically, he was always working for everybody else. He was a great team member, part of the family. And so I give it to him, and what happened next? The time he got up there to give it to somebody, it was, was amazing. I mean, he, I didn't think this guy would be a great public speaker from being honest. So he, he gets up, and this is my favorite item that I own. Okay, like that's an important part of the story. My very favorite, 250, year old priceless artifact. To me, I'm kind of nervous about what somebody's going to do to leave their mark on it. So he gets up there. His name is Sean. He gets up there, and I noticed he's drilled a hole into the shepherd's crook and wrapped something around it and and he gets up there, and he starts talking about what it was. I'm like, oh, man, is my favorite thing. He's just destroyed it. And Sean is a is a road cyclist, and he's really passionate about it. That's what he's into, the way that, you know, we're into golf. And he took a spoke at a one of the wheels, and he said, the wheel that he had taken the spoke out of rode 50,000 miles, but he the identifier was the spoke on its own was useless. It can't do anything on its own, but as a part of a wheel, it was eight capable of running 50,000 miles. And I'll tell you, I didn't think this guy could public speak. He was crying. I was crying. The entire department was crying, I mean, and now it's turned into several years later, David, the thing I look forward to, we do what we call a family meeting, which is basically a company meeting every month at Kendra Scott and every month. And for the last several years, we've identified somebody, somebody reads the book and like they're recognized for it very publicly in the organization. And I'll send you a picture of it, an updated picture of it. Now it looks ridiculous. There's like, unicorns hanging off of it, and a lot of weird stuff. But it's become a great sense of pride and recognition in our organization. It really matters to people. And I feel like, you know, I'm you've paid it forward to me, and I'm paying it forward. I feel like to many others in the company, and it's been awesome.

David Novak 8:20 

That's great. You know, my late wife, Wendy, used to joke. She used to say, Hey, David, the reason why you you love recognition so much is that you love getting it. There's a lot of truth that, yeah, what would be the most powerful recognition you think you've ever received? You

Tom Nolan 8:38 

know, I would say, as a father, when my kids, you know, any, any anybody recognizing me being a good dad is, is probably what's, what, what I recognize the most. You know, my kids saying thank you for things and how much they appreciate it like that's been the best recognition from a professional perspective. You know, I think it's, you know, whenever somebody says, we're, we've, we've done a good job. And I recently, we, we just looked at the numbers of our business, and for the last, for 44 out of the last 40, let's say, for 44 months in a row, we've had meaningful growth, mostly double digit growth, in our business. And I've been the CEO for 45 of those months. And I think when I, when I heard that, and somebody kind of recognized me for that. It was, it was really powerful. You know, you know how it is running a business, you're kind of, you're so caught up in it, and, you know, you're living and dying by every day. It's, it's hard to pick your head up sometimes and really think about like, well, we're accomplishing a lot. And that was a moment for me where felt like, boy, we we put a great team together. We've accomplished a lot together as a team. And, you know, 44 months in a row in this, in this economic and geopolitical environment that we're living in right now, I was really proud of, yeah,

David Novak 9:51 

well, you know, the first principle in recognition is that it needs to be well earned, you know. And that kind of performance is that deserves some recognition, which is fantastic. You know. So you love recognition. I know that, and you're really good at it, and the organization does a lot of it, you know. And I want to get now a little bit more into how you lead, but first I want to take you back a little bit. Tell me a story about your upbringing and and the how that impacted the way you lead today.

Tom Nolan 10:18 

Yeah, I just, I was just telling the story yesterday to a group of kids at UT through the Kendra Scott entrepreneurial Institute. You know, I think how you brought up shapes who you are as an individual. And I had, I had a tough upbringing. I'm the only person in my family to graduate high school. I had, you know, some real challenges growing up, and kind of where I grew up and how I grew up and and I learned at an early age from my parents. You know, my dad was an electrician. He worked for the Long Island Railroad, and my mom was, turns out, she was the entrepreneur in the family. She had a hot dog truck when I was a kid. She had a good humor ice cream route. She, at one point, she was selling GEDs. David, I I don't even think that's legal to sell GEDs, but like she was doing, and I was helping her sell it. So I, you know, I think growing up, I had, I saw hard work come to life, and my my parents were worked really hard to provide for our family and, you know, so I witnessed that in sports was an outlet for me. I wasn't a great student, if I'm being honest, but I was, I was a decent athlete and and if I couldn't throw a baseball, you know, when I was in high school, I probably wouldn't have gone to college, and I'd be an electrician like my dad. And everything I've ever done has really been with kind of hard work and dedication and perseverance and just being relentless. And it's, it's paid a high dividend for me. I also, I would say, had some I know you had lost recently, and I lost my sister, my only sibling, had a brain aneurysm, and she passed away in 2009 kind of suddenly. And you know, I think, I think when you grow up and things are challenging and you've been through some really hard stuff, I think it makes you stronger. For those who survive it and in a working environment, you know, things don't affect you as much like if you if you live through really hard things, and you've persevered, and you've come out on the other side of it, stronger. Things don't scare you in business, you know, a tough, you know, macroeconomic climate, or, you know, bad a bad month or or bad earnings call, whatever. It's not gonna, it's not gonna affect you the same way it does where I think folks that kind of had it a little bit easier growing up, and so it's, I wouldn't change how it was. It was not easy, but, and I put a chip on my shoulder for me in my life, you know, I wanted to prove people wrong that didn't think I could accomplish things. And hopefully, you know, I've, hopefully I'm doing that for people in my family,

David Novak 12:38 

fantastic. And I got to ask you, how'd you, you know you're this big athlete, you know, you're great golfer, obviously, good baseball player, you know? How'd you find your way to Kendra Scott, a jewelry company,

Tom Nolan 12:51 

you know? Yeah, it wasn't for my passion for women's jewelry. David, that's, that's, that's for sure. It's, it's a funny story. I, I started my career in the publishing industry, and I worked at zip Davis, and then ultimately Conde Nast. There was a publisher of golf World Magazine. Then I went up going to Ralph Lauren, where I ran their golf and tennis business, which was great. And I kind of had an itch I wanted to scratch to be an entrepreneur. And I started a holding company called prospect brands, and we owned a couple of different apparel companies. And while I was there, I got a phone call from a private equity firm called Norwest venture partners had just made an investment in a jewelry company in Austin, Texas called Kendra Scott that I had never heard of before. And I don't know how they found my name. I don't know why they called me. I'd never served on a board before. I had never worked in a jewelry business before, but man, am I glad that they did, and they called me and I went on their board, and the company, at the time, I think, was doing about 25 million in sales and had an enterprise value around 100 million. And then three years later, so I joined the board, and I was just really curious. I asked a lot of questions. And I feel like one thing in my career, I've always done things I didn't know anything about, and I don't know how that happened or why, but it served me well, because, you know, I was never a know it all. I just kind of asked a lot of questions because I had to. I didn't, I didn't know things. But three years after we did that deal, Kendra did a deal with Berkshire partners that put an enterprise value on the business at north of a billion. And at that point, she asked me to join the organization. So it was an interesting story in that I was living in Greensboro, North Carolina, running this holding company, and I really loved it there. I went to Chapel Hill to Chapel Hill to get my business business degree. And I was not, she was like, after we did the deal, she's like, I'd love for you to come work at the company. And you know, David, being from the East Coast, moving to Texas, it might, somebody might well have asked me to move to outer space. Like I had not spent a lot of time there. I was not interested. And I was like, hard, no, I do not want to go to Texas. I love what you're doing. I'd love to stay on the board, if you'd have me and Kendra. You know you've had her, you've had her here. And you know, I know you know her as well. I mean, she is talking about being tenacious and relentless, man, she is something. And I knew she wouldn't stop asking me, so she said, we're doing a Kendra cares event. I. In New York City. I was up there for a board meeting for another company I serve on the Board of and I was like, fine. I'll go to this thing. It'll make her stop asking me, like, fine. And I'm a very emotional person. I'm a sappy person. I cry in the movies. I cried sad commercials. And this Kendra cares event, which is where we take our color bar, which is a mobile create your own jewelry kit. We bring it to hospitals and schools and businesses. This specific one was at Sloan kettering's pediatric oncology Ward, and I mentioned that I'm emotional guy. I have four kids. I had no interest in going to a pediatric oncology Ward, not because I didn't want to help people, but because I didn't want to embarrass anybody and I don't embarrass myself. So I very begrudgingly go into this Kendrick cares event, and I get into the elevator and I go up to the floor where the pediatric oncology Ward was, and, you know, and I'm dreading it. I'm very nervous and anxious about it. And before the doors open, I could hear like bass on the other side of the doors, like you're going into a nightclub or something. And I don't know what it was, but the doors open, and we had a DJ set up there. We had clowns and balloons, and we turned a pediatric oncology Ward, which is a very unhappy place, usually, into the happiest place in New York City. And I make I made jewelry for sick kids and their parents and their grandparents and siblings for the next three hours, and time flew by like this, and it warmed my heart, and I held it together as not cried, not embarrass anybody. I get in the elevator, I go downstairs, went across the street, completely lost it. Called home, and I said we were moving to Texas, like I'm never going to get to work at a company where I get and help people like this and and we did, and that was eight years ago, and it's been, it's been a heck of a ride, and we've helped a lot of people along the way. The company's giving back almost $70 million to help women's and children charities, and my family and I volunteer a lot to help those in need. And it's, it's really outside of the business success and recognize our employees. It's been, it's been the greatest gift next to being, you know, having my family that I've had in my life.

David Novak 17:00 

We'll be back with the rest of my conversation with Tom Nolan in just a moment. But first, let's hop into the how leaders lead time machine and go all the way back to my first ever episode with none other than Kendra Scott herself. She actually talks about how they launched their first stores, and what they did to focus on connecting with customers.

Kendra Scott 17:24 

From day one, I believed that the most important thing we could do is create a connection with our customer that the transaction will follow. And the goal of the store was, let's connect. Let's learn from our customer, let's find out what she loves, what she hates, what she wants more of, and then let's utilize that to build the best collections we can. What happened was that experience was so magical that we would have lines down the block to get in. It was like they were releasing a

Speaker 1 17:56 

new iPhone or something. I mean, it was unbelievable. People

Kendra Scott 17:59 

could not wait to get into our stores. And that's when we knew, Okay, maybe this isn't just a one store situation. Maybe we could bring this to other

David Novak 18:09 

places. Go back and listen to my entire conversation with Kendra, episode one here on how leaders lead. So you knew you could really make a difference in the world when you took that job, but you really didn't have a passion for jewelry at the time. I'm sure you know. So in your view, did the leaders need to have a passion for their product to be successful?

Tom Nolan 18:31 

Certainly, it makes it easier sometimes when you do because previous to this job, I was super passionate about working at Ralph Lauren. You know, I loved working in the publishing industry for my favorite magazine, but I think the answer is no. I mean, I'm proof of that. I am not passionate about women's jewelry. I'm passionate about our customer, I'm passionate about our employees, and I think it's made me a better leader, because I'm not passionate, you know, when you're passionate about something, you feel like you're an expert, and you act like an expert. I don't ever feel like an expert in our business. And I, you know, I always similar to you. I have a servant mentality. I always feel like I'm serving our employees. I don't feel like anybody works for me. And I think that is additive to that when you're not passionate about something, because you have to be curious, you have to ask a lot of questions. You got to seek guidance and counsel from others, you know. And I've had great people like you in my life that have helped me along the way and given me advice and pulled me along, and you know, that's that's made a huge difference for me. And I'd say, in addition to that, the biggest difference for me coming here, outside of just being in the jewelry business, was when I started our company was 99% female. My email address is Tom and Kendra Scott, not because I'm special, just because I was the only guy named Tom, which is, like, the most boring guy's name in the world at Kendra Scott, when I joined today, we're 95% female. But that was, you know, that turned the world, you know, the world, on its head. For me, I was not used to that environment. It was very different. And, you know, I didn't. I would have never guessed I'd work wind up in an organization. With that group of constituents, and I would have never guessed I wind up in an industry that I had no knowledge of, but I'm there, and I love it, and I wouldn't change anything, and I love the group of people that we work with. And it's, it's, it's worked out very nicely. So

David Novak 20:13 

95% of Kendra Scott is female, yeah, and you're running it as the CEO, yeah. What has that taught you Tom about being a minority,

Tom Nolan 20:24 

yeah, honestly, David, it's, it's, it's opened my eyes in a lot of ways in that specific regard. I mean, number one, it's, it's taught me, you know, I have to be empathetic. And, you know, I think having high EQ, EQ always wins an IQ. I've always read about that, and I always believed it, but I never saw it come to life the way I've seen it come to life here, so that that's proven itself to be really true here, but, but, yeah, I think it's it's also opened my eyes to like I don't I'm not like anybody. I mean, I'm not like most people in the organization, and it's made me more empathetic to being a minority in different parts of life and work and the world. You know, obviously, I don't know what it's like to be anybody but me, but I understand, I think, a little bit greater than I did, you know, 10 years ago.

David Novak 21:15 

What advice could you give a male leader on this front? I mean, how do you how do you work with the, you know, female leaders and female employees, frontline employees, and what's, what's the key?

Tom Nolan 21:26 

Well, I think I used this example yesterday because somebody asked me a similar question. What I had been used to in the past, working in mostly male dominated businesses, was you and I working together, you know, we're teammates, or I work for you, or we're peers, and I do something you don't like you do something I don't like you, just tell me, and I deal with it, right? And you know, and you're direct, and that's okay, because that's what I'm used to. And we go on and march about our days, and we don't think about it that that was what I was used to, is how I led in the past, that it is not how it works here. And I don't think that's best practice, if I'm being honest, how you make people feel was never a quotient that I had to think about really, in the past. It was all about results, right? It was like, put points on the board if I hurt your feelings, too bad, right? Because I'm putting points on the board, and that's what matters, and that's what people care about at the end of the day, when you're in a for profit business, that is what matters, right? Just to be clear, full stop, however, how you make people feel along the way is much more important. If you want long, lasting results, it's also much more important, I think, if you want to be a good person and do the right thing and lead the right way. And I could get away with it before, because I was a performer, right? And this highlighted the fact that I couldn't get away with just doing that. I really had to think about things a little bit more holistically and and it so taught me, like when I read, I read the way the shepherd once a month. Now I've always, I have, for the last, you know, going on just about 20 years, when I read that book. Now I have a different perspective on it, like the shape of people, how you make people feel, understanding who they are, as a parent, as a mother, as a daughter, as a sister, as a son, as a father, like that. That matters a lot, a lot more than I ever realized. It matters a lot in our organization, we treat people the right way. We have a lot of flexibility for working parents and and it's it in our culture's awesome as a result of it. I thought I had some great cultures in the past, but we have, we have an incredible culture of people that you know need to win. Like nobody needs to win more than I do. Like I am a tenacious competitor. I want to win at everything. I want to win driving to work. I want to win walking in New York City. I just, I want to win everything. And sometimes in a working environment that's not always the best, doesn't always make people feel the best. We do that here really successfully, but we do with kindness and compassion, and I think that is that has paid some really high dividends along along the way. You know,

David Novak 23:58 

as you mentioned, Tom, I did do a podcast very, you know, basically when I was very early on in my podcast career, okay, with, with Kendra Scott, and she, you're right, she is a dynamic leader and, and she's the founder. I mean, you know, she is passionate. I mean, she built this business from scratch. And you know, she has strong opinions. You know, you've obviously had a great relationship with her. What advice can you give to others on how to successfully work with a founder?

Tom Nolan 24:28 

So I've only worked for founders, and I've been a founder, starting at Sif Davis with Bill Ziff, going to Conde Nast with Psy Newhouse, then at Ralph. Then I was a founder of my business. All the companies I'm on the board of everything I invest in, it's all founders. The thing that's I've seen across the board, no matter how big or small the company is, big, public company to a small startup, founders look at the business as if it was their child and as a parent, right? We know that you you were Papa Bear, Mama Bear, as it relates to anything hurting your child. Right, and the idea, and this is why, one of the reasons, when I first came to Kendra Scott I when I became president, I thought that was it. I never thought that Kendra would give me the title of CEO, which I'm very thankful that she did, because it's like giving custody of your child to somebody. And I think you have to be empathetic and understand that founders care about everything more than anybody else, because it's it's their kid, and you, when you compound that with a founder whose names on the building, and I've worked with two of them between, actually three of them, between Ziff Davis, Bill, Ziff, Ralph, Lauren and Kendra Scott, they care even more, right? Because everything that happens is a reflection on them, and it affects their reputation, and ultimately affects their family. So being empathetic to that, and understanding that, and listening, I think, is a key, really key driver. There's a book called The Founders mentality, which I think explains this really well. And for those who haven't worked with founders, it articulates kind of some of these little nuances on a day to day basis. But I think it's hard, you know, and I think when you, when you when you have a combination of a founder dynamic in addition to a financial sponsor, which we have in a private equity partner, it, it, it's even more challenging, right? Because, because the financial sponsor expects operational excellence, and a founder expects that her, her his child, is taking care of the right way, and the brand's growing, and her vision is being executed. So like, I think managing that those two dynamics sometimes is challenging but really rewarding when you do it, because there's nothing better than cultivating a in coaching and teaching. And, you know, I I relish it. I think it's, I think it's a lot of fun. It's hard, but it's more hard. Things are more more fun than easy things.

David Novak 26:41 

You know, you're obviously a passionate believer in learning and building. Know how you've already mentioned three books just, you know, we're just getting into this podcast. What's your process to turn the knowledge that you pick up, either from books or talking to other leaders or visiting other companies? You know? How do you turn that learning into action, so that really drives an impact in the business?

Tom Nolan 27:04 

Yeah, I think, I mean, I'm a voracious you mentioned, I'm a voracious reader, right? And and seeker of knowledge. I didn't have a dad that could teach me business, right? So I sought it out really early on. And there's a lot of folks you've had on this podcast, or people I've you know, you're one of them that I've reached out to over the years to ask for help and advice and counsel. And I think too many people, too many times, people are afraid to ask for help, and you can't be so I think that that number one is really important. I think how you digest it, you got to be authentic about it, right? It doesn't matter what book you read or a person you talk to like, I'm never going to be David Novak, no matter. I could do everything you do, I'm not going to be you. And I think there has to be an authenticity of like taking bits and pieces of Gleanings along the way from different people that you you admire and look up to, and trying to put them into play in your life in any capacity. And it's, it starts really small. So whether I read a book or get advice from somebody in my life, I try to, I try to internalize it. Think about, okay, where does this? Where does this apply to my life in a way where it feels like I'm not being a phony, to do it that way, right? I don't want to be like, Oh, he sounds just like so and so I want to, I can only sound like me, because I'm me. So I think, I think it's about being honest and aware of yourself number one, and then picking the places and knowing, like where your weaknesses are, and then trying to exercise that muscle like I knew my weakness was finance. I just didn't understand a balance sheet the right way the first time I was a CEO. So when I was 34 I went back and got my MBA, because I thought that would make me better at finance. And it did. It made me sharper. And I also feel like, once you have an MBA, you're allowed to say things like basis points. I felt like, you know, all these MBAs say basis points. So I could say basis points,

David Novak 28:55 

hard to scare me here,

Tom Nolan 28:57 

but, but, but I think, I think that that I think it's just like knowing yourself and seeking out information and utilizing it in a way that makes sense for you, not for whoever wrote the book or whoever told it to you.

David Novak 29:10 

I've heard you say that you work for your team. They don't work for you. Talk more about that. So

Tom Nolan 29:21 

when I was, when I was, when I was younger, there's, I have very distinct memories about how we didn't had it. We had nothing when I was a kid. And I have very distinct memories going, you know, like the Ground Round was the nicest, if anybody remembers the Ground Round, like that was the nicest restaurant I was going to go to. So I remember going to places and the way that like people treated my parents had a profound impact on me, like people looked down at them and spoke differently to them than they did to people that had means and so like that always stuck with me. And I also distinctly remember when I was when I was younger, and. Career, I always, like I said, had a little bit of a chip on my shoulder, just because of how I grew up. And I always had a voice. I always had something to say, and I always had an idea or things I wanted to talk about, or questions I wanted to ask, and I felt like, at lower levels, people were very dismissive of me, and I just didn't like the way that felt right I and I just, I always said that, look, if I ever, if I get into a position of authority in any capacity in my life, you know, I I want to treat people the right way, and this idea of servant mentality, you know, I grew up in a household, you know, a lot of my relatives are cops, and they've been in the military. My grandmother's brother was Bull Halsey, so, like a big military where it's the infantry eats before the generals, and that's just how I just how I grew up. So it's, it's stuck with me. And I, I've, you know, I've had great teachers and coaches in my life. Seth was been one of, like a big brother to me, you know, and like one of the most impactful people in my life. And, you know, 1520, years ago, we were talking about this, and I was asking, like, what does it take to be it take to be a great leader? And he's like, and his dad was a teacher. He's like, you know, great, great leaders and great CEOs are just teachers and coaches and, like, it stuck with me, and I say it all the time, and he's right, like, you know, and I'm just a part of a team here. I'm not the most important part of the team I'm to my mind, I'm no more important than anybody else, and I think people know that I feel that way, and it's authentic. I don't just say it because I feel like I have to or I read a book. I genuinely feel that way, like I want to serve. I like serving others. I like I like teaching and coaching. I like making people better. I like making myself better. I you know, I think about like, my my wife and kids, and, you know, I just, I live for them. I live and they're my team here at home, and the 3000 people that work at Kendra Scott like they're my family and my team at work, and I'm just a part of the team, and, and I hope I'm, I'm serving them well, and if I am, I feel like, you know, it'll help lead to great results and but we've got a great team, and I'm just lucky to be a part of it. You know, there are a lot

David Novak 32:05 

of leaders who believe that they need to create some emotional distance from their team members to in order to make the tough call. You know, when those tough calls they they have to be made, and obviously they do have to be made, yeah, what's your take on emotional distance with your team members? How do you look at it? I

Tom Nolan 32:26 

don't think you can have I don't think you can lead people the right way without having an emotional connection to them. Like, I love the people I work with. They are a part of my family. And it's like, it's like being a parent. I think the best you know, outside of being a teacher and a coach, that the closest analogy I can think of for leading people is like being a parent, like, I love my children more than anything on earth, and I discipline them. I remember when my parents used to tell me this when I was a kid, when I was getting smacked for doing something stupid, like, we're disciplining you because I love you. I'm like. That doesn't make any sense, but as a dad, it does, like, I discipline my kids because I care about them and I want to make them better, and if I don't discipline, they're going to grow up to be bad adults. And I think, I think leading is very similar in that, like, you know, if you really genuinely care about somebody, you know who they are and what they're made of, you know, there's forces for courses, and sometimes, sometimes you got to make hard decisions. And ultimately, David, I you've probably seen this in your career too. I you know anytime you had to make a tough decision, it ultimately winds up being the best thing for everybody, right? And if you know that person, you're emotionally connected to them, and you know what drives them, and you know where they're going to land on their feet the right way. You know most people that I've had to displace over the years, I've helped find other jobs, you know. And you know, just because they're not right for our company doesn't mean they're not right for another company. And sometimes that's not the case because somebody's, you know, doing something they shouldn't be doing. But in most cases, I feel like you have to be emotionally connected to people to understand if you're making the right decision or

David Novak 33:59 

not. You've obviously taken that into your business as well, that that mindset. Because, you know, in retail, a lot of companies are always talking about transactions and yeah, you know, you guys, you focus on connection, connection. That's right. Yeah. Say more. Say more about that. Yeah.

Tom Nolan 34:16 

So, I mean, we've got, we've got going, we've got 140 retail stores across the country now, like I alluded to earlier, the business has been really successful. Our retail team is led by an extraordinary individual who's done a great job of the team, and I'm so proud of her. But everything that we've ever done has always been experiential. It's always been about connection, like you have all these metrics in retail of you know, there's foot traffic, and then there's conversion, and there's SPT and upt and all these acronyms of like, how are you going to determine what the KPIs are? They're going to make a business successful? And, you know, nobody needs jewelry, right? Like, it's not sustaining life. They don't need it to so it has to be an experience. So we train our people on Wow, service. We train our people on. Experience. Colleen, who leads our retail team, has done an amazing job of all about making connection, right? And what we see is a byproduct of caring about our customer like our customers, our boss, right? She signs our paychecks full stop, like if we don't treat her the right way, if we don't make decisions based on that person the right way, then we lose. And with that mentality, it's how we approach everything. So retail thinks about it that way. And as a result of that, we have about as high a conversion rate as you can have in the consumer retail world. I mean, our conversion rates and our best stores are north of 40% and that's unheard of, and it's because we don't focus on it like you know? The irony is, we focus on making connection with somebody, and it works. And in addition to that, the team's done a great job of building events. We'll do 140 stores will do close to 30,000 events this year, and the large majority of those events, David, are philanthropic in nature, like we're helping people in a local community. So when you combine the fact that we're a fabric of the local community. We know who our customer is. We treat them the right way, at least for a great connection, and just because somebody's not walking out with the yellow bag the first time, I'm betting when they come back, they will, because we treated them the right way. You know, that old adage of like, you know, you never remember what people said. You remember how they made you feel. It's, it's true in life, you know. So I think, I think that that really matters. It's true,

David Novak 36:24 

but very few businesses really act that ways, and that's maybe why you've had such great success the past couple years. You know, innovation is really a key part of any business, and particularly in retail, where you've got to continually surprise your your customers. How are you driving innovation with your team to come up with the next big disruptor in your your industry? Yeah, I

Tom Nolan 36:49 

mean, look, there's there's some table stake innovation things that we're utilizing the same way everybody else does. You know, AI is prevalent as it relates to the consumer space right now, and customer service and how to get sharper and better. But, you know, I don't, and I think there's innovation at point of sale, right? You know, getting people making their experience better at the store. There's innovation on our website with, you know, dimension is important in jewelry, right? So if you're going to buy a pair of earrings, you want to see what they look like and how they look on an outfit. So we've done a lot of virtual try on type stuff. So there's, there's some like, basic table stake innovation that relates to that. But the thing that I'm trying to constantly innovate on is, how can we, how can we be better to our customer? You know, how can I innovate to be a better leader to our people? How can, how can we be more effective with communicating with one another. How can we eliminate PowerPoint presentations and meetings with a bunch of people on there and like, really be thoughtful? So it's, I'd say it's, it's less about utilizing technology and more about just just leveraging relationships and trying to do the right thing and continue to be outliers in a space that has not performed very well. And I think it's just, it's because when everybody else is focusing on some of these hot button things, like, we're just focusing on, like, tried and true kind of basics. It's like, you know, practicing the six foot putts. Instead of, you know, working on your driver. You hit a lot more six foot putts, and then, you know, then you hit drivers and around,

David Novak 38:19 

yeah, that totally makes a lot of sense. And when you think about your industry, you're outperforming everybody in it because of the approach that you're taking. Is there anybody out there you think that could disrupt your your business?

Tom Nolan 38:34 

You know? I think the greatest competitor we have is ourselves, you know, and and potential complacency because of success. I mean, you talk to, you know, I'm a even though I'm not a great athlete anymore, I like to pretend that I am, but and I admire, I admire what great athletes do. And I think there's a lot of analogies to, you know, sports dynasties, whether you know Tom Brady's been on here talking about, you know, how he led the team and but it's, it is we got our we hold ourselves really highly accountable to continue to put points on the board. So I, I don't worry about what anybody else is doing. I just worry about, you know, us not getting complacent after having a lot of victories and continuing to show up. You know, after the after we went, you know, we look at, we would look at the fourth quarter is our Super Bowl, you know, coming into the holidays. And, you know, we always have these sports analogies in the business. And, you know, we talked about last year, about finishing up championship mindset was our theme for the year this year. And we talked about, like, great teams. Like, what makes championship mindset? It's kind of everything you do you have to think about as a champion. It's like, you know, the only difference is after, you know, after Tommy won the Super Bowl League, he has an off season, like, we just got to get right back at it the next day. So it's, it's, it's just a constant reminder of, like, challenging yourself and continuing to try to be better and better. And so we, you know, there's a lot of cool companies out there that I look. Got that, I think, are doing interesting things in our in our space, specifically, I mean, Tiffany's would be the icon of excellence, I think, and how they operate, and how they bring retail to life. And the flagship they put up in New York City is just absolutely spectacular. And the cafe that they built in there, and the artwork that they have in the store is amazing. And there's a lot of great smaller brands that I admire, what they're doing, that had great founders behind it, whether it's goriana or Missouri, you know, there's, it's a, there's a low barrier to entry in our space. So we got to be aware of people out there. But, you know, the the only thing that I want our team really focusing on is is ourselves and our customer.

Koula Callahan 40:38 

Hey, everyone, it's Kula. We'll get back to the interview in just a second before we do though, I have a question for you. Have you downloaded the how leaders lead app on your iPhone? If you haven't take 20 seconds right now, go to the App Store, search for how leaders lead and download the how leaders lead app in the app, every day, you'll get a two minute video that'll give you a leadership insight from one of our amazing guests from our podcast to inspire you and to really get your mind in the right place before you start your work day. So go to the App Store, search how leaders lead, download the how leaders lead, app, and start your day every day with two minutes of leadership wisdom. It'll take 20 seconds. Go to the App Store, download the app, and you'll be able to watch every day, just like me, the leadership insight from how leaders lead, you know. I

David Novak 41:25 

know you take a lot of pride, and you've built this billion dollar brand, and that was, I know, a big goal for your company, certainly from where you guys started, you know, and now that you're there, I mean, how do you set the the next big goal for your company. I mean, you know, what's, what do you what are you saying? Hey, okay, team, this is what we want to do next, you know, have the goal posts moved.

Tom Nolan 41:52 

Yeah, you know. So it's funny, David, there's so much white space for us. The people will be talking to people who will see the, you know, enterprise value that we've had. And it's like, man, the plane's really up, and you guys are really cruising. I'm like, we're not even, we haven't even left the gate yet. Like, we're still, like, boarding our company, even though we're, you know, several 100 million dollars in revenue. At this point, we have less than a 10% national brand awareness. And so there is a ton of white space out there amongst people that don't know who Kendra Scott is. And I think one of the things that I love I love most about our businesses, you know, we're not just about, you know, selling a product. We're about helping people and doing something special. So I think, you know, for us, it's always about how many more the bigger the business gets, more people that we can help. I we've got a real appetite for expansion. Here in the United States, we have a real appetite for expansion internationally. We launched a brand called yellow rose last year, which very similar to what, what Ralph did it with double RL. Kendra has a ranch called the yellow rose Ranch, so a lot of Western where we're opening our first store, actually, next month, here in Austin. So Kendra's vision for this company from really the Go was to have a global lifestyle brand. And I have worked at the quintessential American global lifestyle brand, and that's our, you know, big, hairy, audacious goal for what we want to be, you know, when we grew up, so to speak. But in the short term, we've got, we've got a lot of room to cover, to just, just preach the gospel on who Kendra Scott is to people here,

David Novak 43:20 

you know you've had so much success Tom as as a leader with your business, you know you had a great family. When you look you and you look back on your career doesn't necessarily have to be at Kendra Scott, you've had to have a failure somewhere along the line. You know, what's one of yours in the biggest lesson that it taught you?

Tom Nolan 43:40 

So when I had my holding company, I would say, you know, wasn't a colossal failure, but it was a failure. And I think I was just probably too big for my britches, you know, I really, you know, when I was when I was younger, I've always been a goal person, David, and I've written down goals, and I'm very disciplined about it. And one of my goals when I was younger, was to be a CEO, and I wanted that so bad that I did it prematurely. I wasn't ready to be a CEO, and I became a CEO of this company, and I didn't lead it the right way. And like I said, I wasn't sharp enough. I couldn't understand a balance sheet the way I needed to. I was so determined to prove people wrong and be successful and be a great CEO that I wasn't being honest with myself, and it was a failure. We wound up, you know, we didn't take we had to heated out of our brand called gerbing, ultimately became the called guide, and probably should have flushed it through bankruptcy, and we didn't, because I was too, you know, thick headed, and I think that was and I was afraid I was embarrassed, like I was embarrassed about it, so I didn't reach out to people I knew that cared about me, that could have given me sound advice. And I was, I was too embarrassed, and I just wanted, I didn't want to. Disappoint anybody. And I think that was, that was probably the one on and I learned a lot from it, right? I mean, you learn from your failures, not from your successes, and it taught me a lot of humility. And, you know, hopefully I don't make those mistakes again in the future. What?

David Novak 45:15 

What do you what do you think was the seminal moment in your career where you realized, you know, you had this chip on your shoulder. You're driving for excellence, trying to move up the ladder. When did you have that seminal moment with said, Hey, no, I might actually be able to do this. I mean, you know. Or was there some point where you said, You know what? I got it Emmy,

Tom Nolan 45:39 

I would say that I've always had a high degree of confidence. I mean, you have to have confidence and, like, self belief. I think to do anything as an athlete, as a I will tell you, I said this last night to the kids at UT. I always struggle with imposter syndrome, right? I mean, I don't know if I'm there yet, like I feel like I have confidence, I know I'm capable. I mean, we've put some great points on the board, and I know that I've been a good leader, and I've created cultures and help help create cultures of winning, because I've got people that have run through a wall for me, because they know I would run through a wall for them. But I struggle with that, but I think, I think getting through covid and putting the doing what we did here, was a seminal moment for me in that, like, holy cow, I just led through about the hardest thing that I'm ever going to have to lead through. And we did it pretty good. You know, we got a great team around us. And I think only other lessons I learned in my holding company was I didn't, didn't trust people enough, and I just have great team that I put a lot of trust in, and I believe in them, and they know I believe in them, and I think that's given me greater confidence to be a leader, that that I could be. And I think, you know, I mentioned earlier what my sister passing away and stuff. It's like, you know, when you go through really hard things. Like, I think it just, it just galvanizes teams, and it makes you realize, like, what's important in life, and, and I think that stuff's going to help shape me over the years. You obviously

David Novak 47:10 

are a leader that has high self awareness, and you're trying to improve. And I was impressed by the fact you said you really couldn't read the balance sheet you wanted the way, how you thought you should, and you went back and got your MBA, you know, what are you working on today? Tom I mean, how are you sharpening your ax? What's gonna make you better in the next five years? Yeah, I

Tom Nolan 47:32 

mean, I'm, like, constantly trying to improve on everything. I mean, I want to always show up. I want to, I mean, truthfully, David, that, you know, this may you may have lived through this too with with but I, I probably wasn't. I didn't show up for my family the way that I needed to earlier in my career, I was so busy building and accomplishing, and I'd say that the the most important thing for me right now in this moment, is showing up for my wife and kids in the way that that they need me to show up for them, for and, you know, for our people, I'm just constantly trying to show up for them better. And what I'm what I'm working on today, like finance is always going to be a weakness of mine, I feel like, and I'm always trying to get better and learn the nuances in business and study where businesses have had success and how they haven't had success, and try to dissect a balance sheet and a PNL in a in a thoughtful way as to avoid pitfalls in the future. And I'd say the other thing is, you know, trying to get our company to constantly move faster, to make sure we're staying ahead, ahead of things like, those are the things that I'm probably working on right now that's

David Novak 48:42 

great. You know, Tom This has been so much fun catching up with you and and I'd like to have a little bit more fun with my lightning round of questions. So are you ready for this?

Unknown Speaker 48:51 

Let's do it

David Novak 48:51 

all right. What are three words people would use to best describe you?

Tom Nolan 48:57 

Stubborn, hardworking and passionate?

David Novak 49:01 

That's four but I'll let you get away with it. Sorry. If you could be one person for a day besides yourself, who would it be

Tom Nolan 49:11 

if I could be one person beside myself? I'd be hard not to, not to want to be. Tom Brady, what's

David Novak 49:16 

your biggest pet peeve?

Unknown Speaker 49:18 

Laziness?

David Novak 49:20 

Who would play you in a movie?

Tom Nolan 49:22 

Ah, jeez, I want to I Ben Affleck.

David Novak 49:29 

I see a little bit of that. That's good. One your favorite golf hole in the world.

Tom Nolan 49:37 

I'd say number 12, Augusta National.

David Novak 49:39 

You get two front row tickets to anything you want. Where would you go?

Tom Nolan 49:47 

I would go to Final Four, North Carolina, being in the final game, championship game.

David Novak 49:54 

That's a good that's a great. One the most fun thing about. Living in Austin, Texas,

Tom Nolan 50:04 

no income tax.

David Novak 50:08 

Hey, you're pretty good at finance. Don't sell yourself short. What is that street in Austin? Seventh Street or

Tom Nolan 50:15 

Sixth Street? And rain Street, rainy street and Sixth Street are the two? Yeah, I thought

David Novak 50:19 

you might say the Longhorns. Longhorn fan,

Tom Nolan 50:24 

I'm an adopted Longhorn fan, yeah,

David Novak 50:29 

the feeling you get when you see the color yellow, happy. What's one of your daily rituals? Something that you never miss, waking up early. What's something about you? Few people would know

Unknown Speaker 50:43 

I'm a big softy.

David Novak 50:49 

That's great. All right, that's a great job on the lighting round. Good job. Just a couple more questions for you. Yeah, you know I love your company's focus on philanthropy and giving back. And you've talked about these kindred care events, you know, all the you know, you talked about how that really drove you, drove you to the company. You know. How do you think about taking that to the next level? Yeah,

Tom Nolan 51:16 

I mean, it's, it is, we have three pillars of the company, David's, family, fashion of philanthropy and fashions kind of, you know, box we get a check, if I'm being honest, and we have, we have to have that one family. I alluded to it earlier, the company feels like a family in a way that I've never felt. But philanthropy is the most important thing that we do, and we don't, I we don't do it on a in a big way, from, you know, writing big checks to large philanthropic organizations. Usually we do it on a one to one way, where we're helping individuals that need help or a family that needs help. So I think that, you know, the bigger the business gets, the more people that we can hire in our philanthropic department. Is a great woman named Sheena Wilde who leads that for us, and the more resources that we can give her, the more times that Kendra's on Shark Tank, the more people that know about Kendra Scott and learn about this, the better. And it might sound self serving, and I suppose it is, to some degree, because our business would get bigger as a result. But this isn't authentic to who we are. Been doing this for 20 the business been around for 22 years. For 22 years. For 22 years, Kendra Scott has made the person, and then the business has made this, you know, the number one priority for everything that we do, and that's never going to change. And I think it's really important. So I it's not about innovating necessarily. It's just, it's about more people knowing about it and coming to us. And I would say maybe, you know, doing a better job in marketing to let people know that this is a driving force for us, and we're not just selling jewelry, but we're trying to help as many people as possible. So it's something we try to prioritize and spend more time thinking about all the time. You

David Novak 52:52 

said that your customers are your boss. It. So how do you as a leader, stay in touch with your customers. What do you specifically do? Do you do anything that's unique on that front or

Tom Nolan 53:05 

Yeah, look, I would say every time I'm going to answer this a couple ways. Every single time I go to speak anywhere, I spoke to kids at UT yesterday, I tell you a seminal moment for me in my life where I stood back and I was like, holy cow. I can't believe this happening. I gave the commencement speech for commencement speech for at Chapel Hill to the MBA class last year. And like, you talk about somebody who's the only person in their family to graduate high school standing in the Dean Smith Center. Like talking to MBA grab is like, holy cow. Like, I can't believe that this is happening. I always give out my email to everybody. So like, I want people to reach out to me and ask for help. I want customers to reach out to me, every customer, every single negative customer service email that comes in, I see and I respond to almost all of them. And we work, not just myself, but like we Kendra myself, all of us, we work in the retail stores. My wife works in the retail stores with me. My kids worked in the retail stores. Like, we sit there and we don't just like I remember, in other companies I've worked at, we would go around and visit retail stores, like we work in the retail stores we serve customers. I'm in the back room restocking things. I work in our distribution center. Our team works in distribution centers, so I feel very close to the customer, and I think that really matters. And we expect every employee to do the same thing, whether you work in retail or not, like that's they're the tip of the spear of what we do. So that's how I do it, and that's our expectation. And it works because you know how it is when you're running a business or a business unit or a department or a division, like, you get caught up in the day to day. You're like, you get so far away from your customer and like, that's the reason you have a job. And we try to stay as close as we can to our customer, because, like I said, she, she signs her, she and he sign our paychecks.

David Novak 54:58 

All right, last question here. What's the best piece of advice you can give to someone who wants to be a better leader?

Tom Nolan 55:05 

The best piece of advice I can give to somebody in life is pay attention to time like it's the only currency you can't make more of you can make more money. You can't make more time, and use it really wisely and invest, invest in the people and the things that matter, and divest of the things that don't. And when you do that, it frees you up to spend more time with your family. It frees you up to focus on the things that matter in your life and your business. Because you know, as we both know, time is short, and I think wasting it is a shame in business and life. And I think if you kind of it serves me well in business, it served me. It's serving me well in life as well.

David Novak 55:54 

You know, Tom it's always inspiring to me when I meet someone who focuses on doing the right things for people, their customers, and then the right things, strangely enough, they just kind of come right back to you. You know, it's an incredible, you know, blessing when that happens. But you know, it's really great to talk to a leader like yourself, who's authentic, you know who you are. You're very focused on on others, and you're a happy guy, you know, the other directed people are the happiest guys in the world. And you got a big smile on your face, right? Yeah? And I don't think it's because of the 44 months of, you know, great sales, which doesn't hurt, by the way. Let's face it, we love that. But you know, the other thing is, what really makes you tick, and I want to thank you so much Tom for taking the time to

Tom Nolan 56:48 

podcast. David, David, you get out of life when you put into it. You know, I try to put a lot into it, and I can't thank you enough. I mean, I don't know if I've said this to you, kind of offline, but the impact, the impact you've had on my life, it hasn't been a lot of time together, but the impact you've had on my life has been profound. And I mean that very, very genuinely, and I am so fortunate to have had people like you in my life. You've left the lasting mark, you know, forever, and it's and I think the best thing about that is it's taught me how powerful that is, to do it for others, you know, but you and Seth and Jim, I mean, there's people in my life that have made an investment of just a little bit of time, and it's, it's, it has really, you know, especially for someone that didn't have that in a dad, you know, like, it's, it really has meant a lot to me. I can't thank you enough. I really appreciate it. I

David Novak 57:42 

could tell you right now, your kids are very, very happy to have you as their dad. Amazing guy. Thanks. Thank you very much, buddy.

You know I like to say, when you do the right things, the right things happen, and the way Tom is leading at Kendra Scott really proves my point. Yes, you've got to deliver results, but how you treat people along the way really matters. And in fact, when you focus on serving your team and connecting with customers, you build the kind of rapport that you need to get those hard results. It all goes hand in hand. So let me ask you, is there an area of your organization where the results are just not where you want them to be? Well this week, sit down with a couple of your team members and brainstorm on what you can do to focus on making real connections with your customers, I bet you'll find some great ideas that will help you move the needle. So do you want to know how leaders lead? What we learned today is that great leaders know that connection creates results. Coming up next on how leaders lead, I've got fawn Weaver, the founder and CEO of uncle, nearest premium whiskey.

Speaker 1 59:01 

I move forward. I take those lessons with me, and they inform how I move in the future, but they do not take me back to my past, so be

David Novak 59:12 

sure to come back again next week to hear our entire conversation. Thanks again for tuning in to another episode of how leaders lead, where every Thursday you get to listen in while I interview some of the very best leaders in the world. I make it a point to give you something simple on each and every episode that you can apply to your business, so that you will become the best leader you can be. You.