December 9, 2025 • 53 mins
A small team launched six stores in a month, refused bargain-bin products, and built a public company that outperformed the category—by betting everything on culture, quality, and customer dignity. Pete sits down with industry legend Wayland Russell to unpack how Rainbow Rentals rewired supply chains, pioneered bundled PCs with Dell, and turned account management into a customer success engine long before that term existed.
We get into the hard decisions behind “more, better, different”: walking High Point for years until a manufacturer agreed to weekly, multi-location delivery; insisting on midline-and-up TVs and appliances; and designing software that enabled seamless vendor ordering and just-in-time fulfillment. Wayland explains why computers—dismissed by competitors as “doorstops”—became a double-digit revenue stream, and how intuitive, icon-based bundles helped families cross the digital divide. His philosophy is clear: be the advantage to the disadvantaged, and let operational excellence make premium accessible.
There’s grit here too: brutal early financing, loans called twice, and the courage to walk away from payday lending margins that clashed with core values. We explore APRO’s pivotal advocacy, the ethics of pricing versus credit-card debt, and the decision to sell while rewarding associates and investing in the community. Along the way, Wayland shares candid leadership lessons—hire for passion, make everyone a partner, celebrate managers on the front line, and act like the conductor who helps others shine.
If you care about building durable culture, rethinking logistics, and serving customers with respect, this story will stay with you. Listen, share with a colleague, and leave a review telling us the boldest idea you’re taking into your business.
APRO
Association of Progressive Rental Organizations
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
SPEAKER_01 (02:11):
Hey everybody, welcome to the RTO show.
I'm your host, Pete Chao, andtoday, special guest legend, we
have Wayland Russell who hasbeen we're gonna have a story
for you.
It's gonna it's gonna manifestfrom little starts to a really
big ending.
And as you know, April is rightnow we're working with April to
get this legend series in hereso that we can get the
(02:33):
information to you so that youunderstand exactly what's going
on and exactly how we can startthis experience um from the
beginning.
And Wayland, you have a story totell, an excellent story to
tell.
Right now, as of right now,though, you are a co-owner of
Eagle Reynolds.
That's correct.
So I see Joe all the time.
Yeah.
(02:54):
Uh but a guy, he's a big guy.
He's a big guy.
SPEAKER_00 (02:57):
You know, uh I started out five foot six, but
uh, I was in martial arts.
I had to have two vertebratesremoved from my neck.
Last year I had three uh uhvertebrates fused in my back, so
I'm down to five, went the wrongdirection.
I started short, now I'm fivefour.
My partners are Randy Lewis,6'4, Joe Fisher, 6'3, and
Richard Morrow, who's 6'2, andI'm five foot four inches.
(03:21):
Well, we we look reallyridiculous together.
SPEAKER_01 (03:23):
I tell you what, what my wife's always told me
and trying to make me feelbetter, big things come in
little packages, right?
I think that uh God has alwaysblessed me to be a man of
stature, regardless of how tallI am.
SPEAKER_00 (03:34):
Exactly right.
SPEAKER_01 (03:35):
And we look for it.
SPEAKER_00 (03:36):
God don't make no junk.
That's it.
SPEAKER_01 (03:38):
That's it.
So you were a co-founder ofRainbow Reynolds.
Now, Rainbow Reynolds, in caseanybody doesn't know, ended up
with 100 plus stores that endedup uh changing names and in some
different acquisitions.
But I mean, Rainbow Reynolds inin what it was in the mid to
late 90s was the place to go.
SPEAKER_00 (03:59):
When we went public in June of '98, uh Renaissance
average store was bringing insix hundred thousand dollars per
year.
Aaron's was bringing in sixhundred and sixty thousand per
year, and Rainbow Reynolds wasdoing 1.3 million per year.
unknown (04:17):
Wow.
SPEAKER_01 (04:18):
I mean, we're talking double numbers.
SPEAKER_00 (04:20):
Yes.
SPEAKER_01 (04:20):
Wow.
Okay.
So in Rainbow Reynolds'existence, there was 124 stores
actually.
SPEAKER_00 (04:28):
Right?
We ended up with that.
We had we had we were not anacquisition story, we were a
grain field story, but we hadseveral acquisitions.
We bought Zoom, we bought WayneChambers uh stores down to own
and and some others.
So, but uh many of them were notthe sizes of our stores, and
they were very fragmented.
So we would consolidate those.
So by the time that uh we wesold to Rena Center in 04, we
(04:51):
were 124 stores, right at amillion dollars per store with
that, because we had several newstores and stuff like that.
So when when did RainbowReynolds get started?
Well, what happened was um uh Iwas uh at that time I was with
Crown Leasing uh for about threeyears.
(05:12):
I started in the industry onFebruary 1st, 19 uh uh 1977 with
uh Chuck Sims and Remco.
And and really before that, therent-owned industry stores
looked a lot like pawn shops.
And Sims was trying to reallybring that forward.
And uh uh and I I caught thatpassion then.
(05:34):
Uh and so um when my first childwas going to be born, uh, we
were from Canfield, Ohio.
So we we wanted to move back tofamily when my first child was
born.
So uh Ralph Devlin, uh thebrother of Tom Devlin and the
owner of Rena Center at thetime, offered me a position as
vice president of operations forRenner Center in the state of
(05:57):
Ohio.
So I moved up there uh back homeand uh worked with him for two
years.
And then I opened up ConsumerRentals in uh Cleveland, my
first store that I own of myown.
Very, very successful.
Uh one of the gentlemen, well,several of the gentlemen that
had worked with me at RennesCenter had left and went with
(06:18):
Crown Leasing.
So Jason Alford, who was a dearfriend of mine, uh a fellow
Christian and brother in theLord, he came to me.
He said, Let us buy consumerrentals, and we want you to come
uh and be in charge of MA at uhCrown Leasing and so forth like
that, and uh manpower.
(06:39):
Uh, they made me an offer and Itook the offer.
Uh and that was with Bob White.
Well, uh about three yearslater, him and Bob White fell
out of relationship.
And uh and because I was soclosely uh tied to Jason, I got
fired with him.
(07:02):
Uh so uh so I told him I said,let's uh let's start this
company.
And I said, uh, or he said tome, I don't have any money.
I said, I've got the money.
We'll get started.
So we brought in uh Jason, LarryHendricks, Mike Viveras, uh, and
(07:25):
uh we put in all the money, tookall the risk, and I gave 57.5%
of the clump company away thevery first day we opened up to
people that I knew that wouldtake to get to where we needed
to (07:38):
men of integrity, men of passion, men with great
experience, and strong, strongdisciplines.
That's important.
And uh so so uh Jason agreed tothat.
And his father was the pastor ofour church in Ohio.
So we started for two weeks at 5a.m.
(07:58):
in the morning, we'd lay down onour faces before the Lord and
say, we don't want this company,we want to work for you.
We want this company to be yourcompany.
So in 1986, uh we we opened upthe first store.
We opened up six stores in thesame month.
That's how we opened up RainbowReynolds.
(08:18):
Wow.
Six stores in the same month.
Wow.
And uh the very first store weopened up was in Boardman, Ohio,
and we had a young man by thename of Randy Lewis, which
delivered the first of twomillion customers of Rainbow
Reynolds history.
Wow.
unknown (08:34):
Wow.
SPEAKER_00 (08:35):
He was on one end of the TV, and Dan Hess was on the
other.
So we started and we werefounded on Judeo-Christian
(09:30):
values.
We didn't try to legislatemorality, we loved everybody.
Your personal uh life is none ofour business.
We're gonna love you, we'regonna treat you with respect and
dignity, and we're going toreward your accomplishments.
And that's what we did.
So you started fast.
You started really fast.
(09:50):
Well, yeah, because you know,we'd have been in the industry
for a while.
And we we the from the veryfirst day, we were going to be a
publicly traded company.
That was decided before weopened the first door.
We would be a publicly tradedcompany.
Uh, because that was the onlyway that we would be able to
share the company with ourfellow associates that would
(10:11):
build the company.
Right.
You know, right.
Uh, and uh we were blessed withuh the best of the best.
Our our turnover rate was like11%, unheard of in the age.
SPEAKER_01 (10:21):
Wow.
That yes of.
Yes.
As of right now, I mean, I thinkright now we're going through a
lot of of a turnover rate in thelast couple of years.
It's just skyrocketed.
SPEAKER_00 (11:19):
Well, you know, even our society, uh, you know, we're
not we're not trained any longerthat you start with a company
and you die with that company.
That's not the the mindset,right?
Uh, but uh because everybody wasso important at Raybo Reynolds,
there was no king and queens.
Uh, the reason that RayboReynolds became the great
company that it was was notbecause of the short Lebanese
(11:42):
Scotchman.
It was because of 1,200 peoplethat loved their company and
loved their customers.
SPEAKER_01 (11:49):
Culture is absolutely super important to
keeping a great business great.
You do not build a company, youbuild a culture.
That's it.
So you start you start there.
You know that you want tocreate, you find some people to
create with you, and you knowthat you're going to take it
public.
What were, you know, going tothis part in your life, what
(12:10):
were some of the mentors or someof the people that you knew that
you were able to model or talkto or rely on to help you make
these decisions and get to whereyou were?
SPEAKER_00 (12:21):
Well, you know, first of all, I surrounded
myself with people that Ithought uh had the experience,
the the uh the expertise, andthe quality of character.
So I surrounded myself withthose people.
And then the Lord brought uspeople.
I like to tell you that I'm sucha great interviewer that I can
pick out the best.
No, you know, it just the peoplethat came to us were
(12:47):
exceptional.
And there was one thing I wantedto see in the people,
particularly if I had to gooutside and hire from out of the
company.
Show me your passion.
Show me your passion.
People have resumes and theyhave work history.
Show me your passion.
It's so important.
Yeah.
So we we were able to fill ourcompany with passionate people
(13:09):
and we treated them as partners.
We never use the word employee.
Not ever.
You know, I I I don't if I'm ifI'm gonna hire a shepherd, I I
want someone that that thatloves the flock, not somebody
that's a hired hand.
And as soon as the wolf comes,the trouble comes, they book.
You know, I wanted people thathad a dog in the fight.
(13:31):
That's why I gave away 57.5% ofall of uh that that I owned,
really, to these people, becausethey needed to love this company
with a passion.
Uh, and that's what wasrequired, and they did.
And each person had their theirskills as as we went in into the
(13:53):
project.
SPEAKER_01 (13:54):
Is there any particular people that stood out
to you that you can say in thebeginning, these were really the
guys that and it sounds like youhad a lot of great people on
that team.
SPEAKER_00 (14:04):
Yeah, you know, I I knew everybody in the industry.
I, you know, I knew Tom Devlinpersonally and what drove him.
I knew Chuck Sims.
Uh, you know, uh I knew uh Mr.
Tally uh you know very, verywell.
And I I and I can't say that Ibought into everybody's ideas,
(14:25):
but I cherry-picked, and I wasable to see where the quality
was.
And we saw our missiondifferently than many people
that go into business.
We saw our mission to be theadvantage to the disadvantaged.
That's why uh we when we startedthe industry, started in the in
(14:50):
or rainbow rentals, all that wasout there was Dixieland
furniture.
That's what, and and we werebuying Mill Mean bedrooms, uh
inexpensive Ashley bedrooms fromuh uh from uh uh you know the uh
uh the the stock people thatwould uh buy the stuff.
(15:12):
We paid 30% more for them uhthrough these brokers, you know.
Uh and so we decided ourcustomers need to have the same
kind of furniture we want in ourhome.
So me, Larry Hendricks, who hada polio leg, and Mike Fivera
started walking the High PointFurniture Show every April,
every October, when nobody inthe industry was there.
(15:37):
And uh the only way you couldbuy furniture was you bought it
at the High Point Show for sixmonths.
It was, and every month it wasdelivered to one location.
I said, no, no, no, no.
We have 60 locations.
You have to deliver to everylocation every week.
I need, I need a dozen livingroom sets in 60 different
(15:59):
locations every week.
And for two years, for everyshow, walking and walking,
walking, we got no, no, no, no,no.
Until we went to EnglandCorsair.
And Rod England says, we can dothat.
We changed the world.
SPEAKER_01 (16:16):
How important was that meeting with Rod England
that that you got this one yesnow?
How pivotal was that to creatinga different gross set in what
you did?
SPEAKER_00 (16:28):
Well, just think of England Corsair.
First of all, they they pickedup 60 stores that that was, you
know, uh buying a dozen sets offurniture every single week.
Yeah.
All right, so that was a bigjump for them.
But what do you think happenedat Renaissance when they found
out that we had the qualityfurniture we had in our stores?
(16:48):
England Corsair got a call.
So then, and next thing youknow, Lazy Boy was buying
England Corsair.
Uh, and it launched them.
From those ideas, from that thatjust in time delivery and so
forth, Ashley adopted thatmodel, and that's why they're
the biggest furniture store byevery metric today, because we
(17:11):
changed the way furniture waswas bought, marketed, and
shipped.
SPEAKER_01 (17:16):
So when you when you go into England, Corsair, and
you say that you you want allthese sets, and I mean, they're
seeing the potential in this,they're seeing how we can really
make a difference.
How come is it that the othercompanies didn't see that value?
Because if you're coming to meand I'm selling furniture and
you're telling me you got 60stores and you want a dozen sets
shipped all the time, I'm gonnashake your hand and we're gonna
(17:40):
do business.
What prevented other people fromdoing that?
And what do you think it wasthat England said, hey, I see
the potential in this and I'mgoing with this versus others
who at the time really didn'tsee that value?
SPEAKER_00 (17:51):
Well, you know, working through distributors,
again, there's a 30, 35% markup,and you can only get what
they're gonna offer you.
Correct.
We wanted more better, differentfor our customers.
We wanted more, better,different for our associates.
We wanted more, better,different for our investors
later on.
(18:12):
And we worked hard to answer thequestion how can we be more
better different?
So the reason nobody else did itis that no one would do it.
It took two years of justtalking and preaching to these
manufacturers that we want todeliver to our customers your
(18:36):
products.
We don't want Dixielandfurniture, we want your
products.
I want a product that I would beproud to have in my home because
that's what my customersdeserve.
So we fought for it and wefought for it, and we found one
knucklehead that said I could dothat.
So Rod England and I, and uh anda guy by the name of Jim Carbot,
(18:57):
who called every one of ourstores every week to get the
order and then turn it in intothe company.
SPEAKER_01 (19:05):
You know, it's funny you say that because we just
talked about Ashley and howgreat they are.
I have guys that I've known foryears, and no matter where I've
worked in this industry, theywill call every single week.
Hey Pete, how are you doing?
What are you guys looking for?
This is what I have going on,this is what I have coming up,
this is what's coming out of thenext quarter, this is what might
be, you know, this is a drop inprice.
(19:25):
You guys want to jump on that?
I mean, it's just amazing.
When you have somebody who'swilling to work with you and
really willing to make adifference, those partnerships
can make some amazingdifferences.
SPEAKER_00 (19:37):
He knew every manager, loved them dearly.
They loved him.
He had to hire help, he had toget an office, hired help to be
able to do that.
We did millions of dollars withthem.
I mean, Rainbow Reynolds'average year, we bought$70
million worth of merchandise.
Average year, average year.
That is a good we we've been upto 94 million in one year of
(20:01):
buying merchandise and justpurchases.
Just yeah.
SPEAKER_01 (20:04):
Wow.
SPEAKER_00 (20:05):
Wholesale priced furniture.
SPEAKER_01 (20:07):
So we're talking about furniture.
So we're talking about the earlydays.
You know what you wanted to do.
Yes.
You got with some of yourpartners, you knew you were
going to be public.
57.5% out the gate.
You get six stores in the firstcouple of months, and we talk to
England, and and they say, Thisis this is the deal.
This is what we're going to do.
(20:28):
When did the trans, because thatthat is a huge deal at that
point in time.
Huge.
When did Rainbow Reynolds startstepping into technology?
The early TVs, the early washerand dryers, the early laptops.
SPEAKER_00 (20:39):
Well, you know, uh, when we would go to uh, and I
remember the first time, uh ormaybe not the first time, but
close to the first time I met uhNorm Smith from uh uh different
TVs that he was was selling andso forth.
And oh, you're rent-to-owned.
So they would take me to theMilba Toast console TV or
portable.
(20:59):
And I said, Listen, if you wantto do business with Rainbow, you
take me to the middle of yourline and go up from there.
We don't want anything belowmiddle.
Our customers deserve the best.
So we were we worked hard togive our customers the absolute
best product, and we collectedbetter than anyone else.
(21:20):
Our average car close was lessthan 4%, our bad debt was less
than 1.5%.
Wow.
Uh, and we collected better thananyone else because we did not
have bill collectors.
We had account managers thatwere supposed to get the
account, work with the customer,and get them to win.
Okay, so we were so efficientthat we could offer the better
(21:45):
products for less than Run aCenter was selling the Milba
Toast products.
Wow, that's that's amazing.
Yeah, all of those savings wentback to the customers.
Our job was to provide in thefuture our investors with a good
return on their money.
It wasn't to try to stack moneyup and see how much we can make.
(22:08):
It was we we have aresponsibility to make uh a
living uh uh for all of ourassociates, and we have a
responsibility to make a goodreturn for our investors.
So, which products came first?
So you're talking about the didthe television systems come
first and then Well, yeah, wewere the first to do rear
projection TVs in in the world,the very first retone company to
(22:28):
do that.
We were paying$3,000 wholesalefor a rear projection TV in
those days.
Yeah, yeah.
And what we did is we marked itup two times, and we only
initially rented it to existingcustomers as another unit.
And then we just kept ratchetingthe product up.
(22:49):
Then I felt as though we neededto get our low to medium income
customers into the computer agebecause I knew it was coming.
So uh what I did is I went toEugene Calabria, the CEO of um
uh Global Business Systems.
(23:10):
Most of the medical places yougo to are running GBS software,
global business systemssoftware.
And they were on the front pagewith Dell Computer.
So I told Eugene, I need to findsomething.
Because at that time, when youbought a computer, you got a
blinking asterisk in the topleft-hand corner.
And you all you can do is playsolitaire unless you typed in
(23:32):
Cobalt language, or it wouldn'tdo anything.
Correct.
Well, then my customers, thatwasn't gonna work.
Right.
And and and I was concerned mycustomers, more than anybody
else, needed their children tostay on on par with anybody in
the world so they can rise abovewhere they're at, possibly, and
have a better future.
So I went to him and I says, Wegotta, we gotta find a way to do
(23:55):
that.
He says, Well, let me make aphone call.
He calls Dell Computer.
So now on 224 in Canfield, Ohio,in my conference room, I got my
IT guy, Matt Pecia, who wasbrilliant.
Matter of fact, we wrote asoftware system that would trump
any software system that's heretoday.
I mean, I can tell you in aninstant exactly how many orders
(24:17):
was placed today, how muchmoney, so forth.
Uh, our our guys use icons toclick on and order their
merchandise.
And and it was all EMI.
That Whirlpool didn't even knowthe order came in.
We didn't know the order wentout.
It just went, it showed up onthe dock.
They shipped the stuff when theyaccept it.
If it matches, the computerspaid each other, and that was
(24:38):
it.
Seamless transactions, okay,with it with that software.
But now I'm now I'm in theconference room with Matt
Peccia, the director of IT forGBS, and Dell Computer in just
this little puny company on 224.
(24:59):
So Dell Computer went to workand they created four Rainbow
Rentals.
And by the way, nobody hadbundled software.
When you bought the computer,you got a blinking asterisk.
We set up uh strategic allianceswith Net Zero, Quicken, all of
that.
We were the first company in theworld.
Well, I let me qualify that.
(25:21):
Obviously, whatever Dell did forus, they proliferated to the
whole world at that same moment.
SPEAKER_01 (25:26):
Absolutely.
SPEAKER_00 (25:27):
But they did it for us, okay.
So, like at the exact samemoment that we were doing
bundled software, all of asudden it was being marketed to
everybody, which is good.
I mean, they did the work, theythey deserved to do that.
But we came up with this iconsystem for our customers to use.
So now our customers weresurfing the internet before
(25:49):
mainstream America was.
unknown (25:51):
Wow.
SPEAKER_00 (25:52):
And and and at the at that time, a direct quote, uh
uh Mark Speed of Render Center,I love the man, he's a good man.
He was telling the people on theon the conference call and so
forth that computers made goodboat anchors.
Bill Morgenstern from uh fromRentway said that computers in
(26:15):
the rent-to-own industry weregood doorstops.
Imagine how embarrassed theywere when we went public in June
of 98 and we were doing aquarter of a million dollars per
store in rental computers.
SPEAKER_01 (26:28):
And and if I remember the article that I
read, which actually came out inApril, um very close to that
year, was that I think it was2005 or something.
I can't remember the articletime, but they were kind of
going back over on how not onlydid you were a pioneer on that,
but it didn't just take off.
It was one of the higher sellinguh items that you had, one of
(26:50):
the lines that you had.
Oh, yeah.
SPEAKER_00 (26:52):
It immediately became 10, 12, 15 percent of our
income.
Right.
So, I mean, it was absolutelyhuge.
Uh, and um it it it justleapfrogged again.
The motivation for doing thatwas not to make a big pile of
money.
We hoped that it would, and wewere gonna try to market it
right and price it right, but wewanted to be the advantage to
(27:15):
the disadvantaged.
And as I say that, we looked onhow we could make their lives
more, better, different on aconstant basis.
So we saw the vacuum infurniture with the stuff that
was there.
We saw the vacuum in the low uhTV sets, the lowest
refrigerator, the lowest washerdryer.
(27:38):
We saw that vacuum and we wantedto fill that hole.
And now the industry has torecognize that AI is going to
create advantages for mainstreamAmerica that will leave the
disadvantaged behind.
(27:58):
This industry has theresponsibility to make sure that
we deliver those same advantagesto our low to medium income
customers that that are makingour livings for us every day.
They're our first concern.
Now, as an owner, uh you know,for me, I wasn't the most
(28:21):
impressive CEO you ever met.
You know, I most people wouldsay you can't even make the
heights requirement.
But but what what I saw for meis I was the band conductor.
I I could not play theinstruments anywhere near as
well as every one of them couldplay their instruments, but I
could help them make beautifulmusic together and they face the
(28:45):
audience, they get the applause,not you.
You're working for them, they'reworking for the audience, you're
working for them.
So the way that we had superiorcustomer service is we made it a
joy for every associate to cometo work every day.
They knew that they were loved,we expected the best out of
(29:08):
them.
When they didn't give us thebest, with respect, we told them
so.
But always treating everyassociate as a partner with
respect and dignity.
And the reason Rainbow Reynoldswas great was not its
top-of-the-heap management, itwas the the manager that greeted
(29:29):
the customer with joy every timethey came in the door and their
fellow associates.
And we we paid every singleassociate salaried.
Really?
Every associate of RainbowReynolds was on salary.
Sick or not sick, you got paidthe same.
(29:49):
Always.
A technicality that if youdeliver furniture, interstate,
you could be paid salary.
Every secretary, we had 67people in our home office, every
(30:12):
one of them made one deliveryevery year.
And we made them do it.
It wasn't just, you know, uhsaying it.
No, they had to do it.
And we got challenged withwaging hours.
And the lady that was comingafter us said, we have never
heard so many happy associatesas when we we were asking them,
(30:33):
you know, uh, don't you thinkyou would make more in an hour
with the hourly with overtime?
And they said, Oh, don't youmess with this, you know?
They they they loved theircompany.
And the reason that we did thatwas not to save money.
We did not want to buy ourassociates' loyalty one hour at
a time.
You understand?
(30:54):
If you're an associate ofRainbow Reynolds, you are an
intricate part of who we are.
You are important as anyoneelse.
So we're going to treat you withthe same respect and dignity.
We self-insured.
The most you could pay for, ifyou got six kids, the most you
could pay for for your healthcare is$3,000 a year maximum,
(31:17):
including doctor visits,prescriptions, everything.
SPEAKER_01 (31:22):
Wow.
SPEAKER_00 (31:22):
We hired an insurance company, I think was
Aetna, the last one was Aetna,and we took picked a policy, but
they weren't insuring it.
We had catastrophic insurance.
If you went over$50,000 as anindividual in one year, then the
insurance would kick in.
But until an individual wasgreater than$50,000, we had no
(31:46):
insurance.
And next year it starts overagain.
So we were self-insured.
We took every single associate,the manager, and their spouse,
male and female, manager and thedepartment heads on a cruise
every year.
About 300 people we took on acruise every year, and that's
where we remembered our culture,who we are, and why everybody's
(32:12):
important, and what is ourmission here?
Okay.
Uh it was the greatestexperience of my lifetime.
SPEAKER_01 (32:21):
I I it I love the sound of this.
I love the sound of the culture.
I love the sound of work.
You can tell the passion whenyou're talking about.
I can see it coming out of you.
So going back to the beginningthen, and starting over, because
these are all these are allamazing high points.
What were some of the hardestthings that you came across
during those times?
Like when when you when you'rewhen you're this is rocking and
(32:43):
rolling, right?
You've got England furniturecoming out.
You you're looking at the theTVs and telling them, listen, I
need something quality.
You're getting the larger TVs.
There had to be some trials andtribulations along the way.
SPEAKER_00 (32:52):
Oh, there absolutely were.
From the very beginning, wewanted to borrow$1.5 million to
get started.
Before ever I had a loanagreement, I already had$30,000
for the payroll before I evenhad a loan agreement.
So we go to Christ, the firstcorporate credit, and we want to
borrow$1.5 million.
Now, this is at the time, 1985.
(33:12):
So this is the deal we got forour money.
So they're going to charge me18% interest rate on my money.
I got to pay the attorney feesand so forth, which was$30,000.
I got to give them$300,000 of mymoney to put in a CD.
They're going to pay me 5% toloan it back to me at 18%.
(33:34):
And I had to give 15% warrants.
So now we had we had the Call attwo years and the put at three
years.
I calculated beforehand that bythe time we got to where the
call was, that those warrantswere going to be worth an
(33:55):
additional quarter of a milliondollars that they were going to
make.
I ended up calling calling it,or I'm sorry, the put was going
to be uh 250,000.
I called it after two years andpaid them an additional$400,000
after two years.
So calculate the interest rateon that.
I was paying 18% on$1.5 million.
(34:17):
They actually only loaned me$1.2, but I'm paying 18% on$1.5.
I paid$30,000 for their attorneyfees and so forth, and then gave
them$400,000 more after twoyears.
Calculate that interest rate.
That is, you know what wouldhave been more expensive money?
(34:38):
No money at all.
So the Lord blessed us, and wewe could say, you know, let this
is too crazy.
No, we knew that we weresupposed to do this, and that's
what we did.
Uh there we were, we had ourloans called twice.
We've never missed targets oranything for any bank or lending
(35:02):
institution.
Our last bank was Bank ofAmerica.
Actually, uh we ended up thelast one, was a consortium with
uh uh uh Ohio Bank, Comera Bank,and uh National City Bank,$40
million facility that we we hadwith those three banks uh at at
the time.
Um so when they call thesenotes, it was because, well, uh
(35:30):
one guy, I'm trying to rememberhis name, he was an accountant,
he had 220 stores uh uh with uhBank of America and uh another
one of the financiers, and he hewent bust.
So the next thing you know, ourbanks are calling our note.
That's normally the kiss ofdeath of any corporation.
They you don't have that kind ofmoney just laying around.
(35:53):
And uh and the second time itwas called, I think it was when
Henry B.
Gonzalez decided to hold Senatehearing meetings about the
legality of rent to own.
So now the banks want it out.
They said, we love you, you'vealways done what you're supposed
to do, they want it went out.
So we went out there trying tofind everybody we could find,
(36:18):
and we could not get the money.
We weren't going to get themoney.
So we went to the bank with ourtails tucked between our legs
and told them, we'll shut downall growth, we'll give you all
profits, and we'll have you paidback in one year.
They agreed to that.
As soon as they agreed to that,we have three banks call us back
with incredible interest ratesand so forth.
(36:40):
And Bank of America uh took ourtook our loan for about 5% at
that time.
Now, the reason we couldn't findanything is God is a jealous
God.
He wanted to make sure we knewthat we were blessed in that
situation.
(37:01):
The next the next situation Ihad, um my partner, who I dearly
love to this day, like abrother, decided to uh leave the
company after 11 11 years intothe project.
He was the bank guy.
He was the guy that kept the Iwas the operations guy.
I you know, products and peopleand all of that.
(37:25):
Uh so he leaves the company andwe have to buy him out, which
was$11 million at the time.
Oh okay, we gotta buy him out.
We had we had about$12 millionwith Bank of America, and we
(37:45):
probably were doing uh at thetime maybe$70 million a year.
So now I'm gonna have to borrowuh it would have been 12, uh
about$23 million on$70 millionof revenue,$60,$70 million of
(38:05):
revenue.
No bank would do that.
So I flew to Chicago to meetwith the the the, and they met
me a couple of times, you know,but but really I had to
reintroduce myself to them andsay, okay, now Jason's gone, and
now you got to loan me$24million.
Mike said, there there is no wayin the world.
(38:26):
They said, okay.
Michael looked at me, I lookedat him.
Now, the reason they did that isI'm such an impressive guy and
such a good speaker.
No, you know what?
We were a company founded onJudeo-Christian values.
We treated everybody withrespect and dignity and with
good intent.
And the Lord made that happen.
(38:47):
One year later, we took thecompany public for the highest
multiple uh rent a rent rentcompany ever had.
We, and there's another storythere.
You're talking about trouble.
We went out on the road show totake the company public.
We had the three topunderwriters on our book: Hunt
Robinson Humphrey out of out ofAtlanta, Dane Rosha Wessels, and
(39:08):
Sun Trust Equitable out ofNashville.
They were on our book.
I presented 65 times in 12 days.
One day I woke up in New York, Ipresented in Philadelphia, I
presented in Salt Lake City, Ipresented in Seattle, and slept
in San Diego.
One day.
One day.
Wow.
So it's the last day we'representing to a portfolio
(39:32):
manager in New York.
And he says, by the way, uhCooper Mills from Robinson
Humphreys called a specialconference call.
We've reserved our boardroomupstairs for you.
Uh, so right after yourpresentation, you can go up
there.
So I presented to him, went tothe top floor, and now this guy
(39:55):
from Youngstown, Ohio is lookingat a table with 40 chairs around
it.
The whole floor is glass and apanoramic view of the entire New
York.
And here's this this littleshort guy from Cantville, Ohio,
okay, with with Mike Peccia, uh,my chief financial officer and a
(40:17):
representative uh from uh uhRobinson Humphrey.
So he gets on the phone and hetells me, well, Whalen, this is
June of '98.
He said, uh, right now thedot-coms are all the rave.
Nobody's investing in anythingbut dot-coms.
There were 15 companies tryingto get out public.
(40:38):
Five have already delisted, fivehave downpriced.
We're not sure that we can getyou out in the price range of$10
to$12.
And we're we're really doubtfulthat we're going to be able to
get you out if you insist ontelling our investors that
you're going to give 10% oftheir earnings away to good
works every year.
(40:59):
I said, okay, okay.
Well, first of all, let me makesure everybody's on the phone.
Dane Rousher Wessels, who's onthe phone?
They told me who was on thephone.
It was the principals who wereon the phone.
Sun Trust Equitable.
I asked Larry Hendrickson, uh,my chief operating office, you
on the phone?
Yes, Will.
I'm on the phone.
Mike, my president, are you onthe phone?
Yeah.
Okay.
I want you all to understandthis.
The price is 10 to 12.
(41:20):
If you can't get that, don'ttell me.
Just send me a letter.
That'll be fine.
Mike, how much do I haveinvested in taking the company
public so far?
Mike said, about$780,000.
This isn't 98%.
Okay.
I said, right now, Rent ACenter, average store is doing
$60,000 per year.
(41:42):
Aaron's is doing$660,000 peryear.
Rainbow Rentals store, our 63stores are doing$1.3 million per
year.
And the reason they do that isbecause of our moral fiber.
It is who we are.
So if investors don't like that,we don't need their money.
And this phone call is over, andI hung up on them.
(42:05):
We came out with the highestparticipation of family and
friends they'd ever seen.
And we doubled shortly after wecame out.
We came out at$10 and wedoubled.
And then when we sold, wedoubled again.
Wow.
And the reason that we sold in2004 is I had a real conundrum.
(42:27):
I'm a publicly traded company.
Rent a Center is going to paydayloan, which they had every right
to do.
Aaron's is going to payday loan.
Rentway was going to paydayloan.
They were making 900% on theirmoney.
And we're saying we're a companyfounded on Judeo-Christian
values.
(42:47):
So I can't tell the investorsanything that I have is going to
make 900%.
I don't have anything that'sgoing to make 9%.
We outprofited all of them storeby store.
But I don't have a product thatmakes 900%.
I don't want a product thatmakes 900%.
So I had no choice.
It was time to sell.
And when we sell, when we sold,every every associate, even
(43:10):
part-timers, were rewardedhandsomely, stock options, and
so forth.
And we built a new high schoolfor Youngstown Christian School
with the proceeds.
Wow.
Because we weren't there tobecome personally wealthy.
We hoped that would happen, youknow, because the much is given,
much is required.
And you know, we love beingcharitable and philanthropic and
(43:30):
all of that.
But it wasn't about let's seehow much stuff we could acquire.
We wanted to build somethingspecial.
Wow.
SPEAKER_01 (43:39):
So when you're talking about, we're talking
about Henry Gonzalez out ofTexas.
And if anybody doesn't know,that was a period of time where
we were on the table andsomebody wanted to eat our lunch
or eat us for lunch.
SPEAKER_00 (43:54):
Oh, no question.
SPEAKER_01 (43:55):
Um, in that situation, were you a part of
April?
How did how did that come about?
SPEAKER_00 (43:59):
Yeah, you know, uh April was originally founded by
Chuck Sims and a few others.
So I was the store manager.
Every one of us, from so fromthe first day I entered this
industry, I was a member ofApril.
So I've been a member for 48years.
Wow.
Okay.
SPEAKER_01 (44:15):
So and back then, how important was it to be part
of an advocacy group like APROthat can really take these
challenges on head first andkind of help out with people
such as yourself to stop andreally educate uh the lawmakers
on what we really do versus whatthey really think we do?
SPEAKER_00 (44:36):
Well, you know, uh just getting in now, understand,
let's see, I became plantmanager of American Exochemical
at the ripe old age of 23.
So I was 26 when I entered therent rent-to-owned industry.
So we went to conventions and soforth uh with April back then,
and we didn't really realize howimportant April would be.
(44:58):
We just thought it was a tradeassociate, like all companies
do.
SPEAKER_01 (45:01):
Right, right, right.
SPEAKER_00 (45:02):
You know, we didn't realize, you know, obviously I
realized later on that if itwasn't for uh April and every
human being with April, that weEd Wynn saved this industry.
Uh Wayne Chambers saved theindustry.
They were going to, the IRS wasgoing to control us out of
(45:25):
business with the way theyexpected us to uh depreciate our
goods and so forth, we wouldn'thave been able to make a dollar.
They could have ruined us thatway.
The government had funded uhlegal aid in every state to
attack the rent-to-ownedindustry, to destroy us.
(45:45):
And Henry B.
Gonzalez was holding Senatehearings on the legality of our
transaction.
So we had a fight for ourexistence.
If it were not for April and thethe impassionate people there,
there would be no rent to ownindustry today.
SPEAKER_01 (46:02):
I agree with you 100%.
And I'm glad that you're a partof that.
So did you, aside Henry B.
Gonzalez, were you ever part ofthe groups that advocated for
either state regulation orfederal regulation to benefit us
and to educate the lawmakersthemselves?
SPEAKER_00 (46:20):
You know, we we we had people that went, but more
than anything else, we felt aresponsibility from our size to
fund it.
So uh you don't understand howmany millions of dollars that
went in to protecting ourindustry.
Thank God Renaissance was whatit was then.
And Charlie Lautermilk atAaron's was very, very generous.
(46:42):
More generous than RainbowReynolds.
We I think we carried ourweight, but you know, at that
moment in time we weren't as bigas when we sold.
Uh, but we we certainly hadpoured hundreds of thousands of
dollars into legislation and soforth, while Renaissance and
Aaron was pouring millions ofdollars into it.
(47:03):
Uh and this industry owes a debtof gratitude to specifically to
Ed Wynn and specifically toWayne Chambers at that at that
time, and certainly so manyothers, but those two men uh ran
point for us on some verydangerous soil.
SPEAKER_01 (47:24):
So, how did how did Rainbow Reynolds and yourself
get the narrative through whofrom people just like that?
We're not just talking about thelegal side, but there was always
that that connotation that, youknow, rent-to-owned, we're
taking advantage of customers.
How did you break through thatin different situations to let
people know that this is whatour business, our industry, our
(47:46):
people are really doing?
SPEAKER_00 (47:48):
What I try to explain to them is that any bank
that's going to loan you moneyis going to measure your beta or
the risk involved, your abilityto pay back.
Okay.
So in our industry, there is nodebt, but we need to get our
merchandise back.
(48:08):
Okay.
So when we send something to acustomer, we price that at the
very best price that we can.
We service it, we stand behindit, and we will take it back
when you've used half of it ormost of it, or whatever the case
may be.
So there's inherent risks inrenting the merchandise that
(48:35):
we're taking, that when you buya piece of merchandise, you're
taking risk.
So we charge extra for thoseservices that we offer.
But when you take into accountwhat's in your wallet, if you
make the minimum payment everysingle month, they're going to
increase you to 32% interest andyou will get nothing for that.
(49:00):
So if you think we're expensive,look to American Express and
Diners and MasterCard and Visa.
And if you want to talk aboutusury, that's usury.
That taking people that maybehad a problem.
My own sister, her husband diedin a tragic tractor accident.
(49:21):
Sorry, and expenses were comingin, so she ran up her credit
cards and made a payment everysingle month.
She was making a minimum paymentevery single month and she was
paying 32% every year on thatdebt.
I said, give me those bills.
(49:44):
Paid those off.
She's never had a balance on acredit card since.
And there's a lesson in that forus.
There are 40 million people outthere today with with greater
than$7,000 on their credit cardsright now.
And they're getting nothing fortheir money.
Those 40 million people shouldbe our customers.
(50:06):
We have to find a way to get tothem and tell them it's
acceptable and even wise to usethe rent-to-owned transaction
rather than put it on yourcredit card.
Your best thing you could do isget a home mortgage.
That's the smartest thing.
Even better than that, pay cash.
(50:27):
But if you're not in thatposition, don't put it on a
credit card.
Come to Eagle Runnel Purchase.
There you go.
There you go.
SPEAKER_01 (50:37):
What would you say is some advice with all the
information, all the historythat you have gathered?
What is something that you wouldwant to pass on to somebody in
the future?
Somebody that's coming throughnow, somebody that says, I want
to open a store, I want to be inthis industry.
Um, what would be some of youradvice to them?
SPEAKER_00 (50:55):
You know, I don't know where I heard this, but it
was from someone very wise saidto me, You can get all you want
in this life by just helpingthem enough of other people get
what they want in the life.
So treat everybody with respectand understand you can do more
together than you will ever doby yourself.
(51:18):
I'll give you this one laststory.
One time we had our the secondtime we had our loan call, I
went on the bike trail as Inormally do, and I ran eight
miles before anybody was atwork.
And we we had called for anexecutive meeting for everybody
to talk over what we would do,how we would go about it.
(51:39):
So while I'm running this eightmiles, I have an epiphany.
I've got the answer.
I can't wait to get to ourmeeting with the executive
group.
So I go in my conference room, Iput on the chairman hat, and I
started listening to the ideasto my left.
By the time we got to the leftcorner of the table, I'm not
sure I had the best idea.
(52:00):
By the time we got to the rightcorner, I'm not going to tell
anybody what my idea was.
And and I will tell you, in allof the years, I don't remember
ever picking my idea one time.
Not once.
I didn't have to.
All my only job was to pick thebest looking pig on the truck
and go with it.
(52:21):
But you know what?
If it was your idea, we weapplaud that, and it's no longer
your idea.
It's our idea, it's ours.
And we would go from there.
So surround yourself with thebest and help them be great.
Don't worry about your owngreatness, help them be great.
(52:41):
Words of wisdom.
SPEAKER_01 (52:43):
So in the end, as we come to a close, not a selfish
question, but I do want to know.
How do you want to beremembered?
If somebody says, you had achoice, and and usually we
don't, usually it's the actionsthat have created, we've done
throughout our entire lives,that have put us into where we
(53:04):
are now.
And then the people who look atus, that know us, that have been
with us, our family, ourfriends, our loved ones, they
get to say, This is how Iremember you.
But if you had the ability tolook back at your life, which
you do, and and and say, This iswhat I think I would remember,
be remembered for, this is whatI think I would like to know
that people would probably saythis about me, what would that
(53:26):
be?
SPEAKER_00 (53:26):
I think I'd like to be remembered as a less than
bigger than life CEO that knewthat his job was to make others
great, not to be great.
So if on my tombstone, if theyput here lies a guy that made a
lot of money, then I had wastedmy life.
You you have just indicted me onmy own tombstone.
(53:50):
Here's a simple man that trustedGod and did his best to bless
others.
That's the way I'd like to beremembered.
I think you will.
SPEAKER_01 (54:01):
Well, everybody, we uh I I can't imagine somebody
else who has gone through thethings that you have gone and
really able to accomplish thingsthat you have uh in the way that
you have.
I mean, Rainbow Reynolds, Iremember when I first came on,
uh, I actually started atRenter's Choice under Ernie
Talley.
So if you say the name ErnieTalley, it takes me back to
those days, the early, right atthe early two.
(54:23):
I actually started in January of2000.
Um, and it just it just bringsback so many memories because
that was a good company and itwas some good leadership.
And we're really glad you guyshad time to sit in with us.
Listen, if you want to connect,by all means, reach out to us,
Pete at the rtoshowpodcast.com.
Don't forget to the website iswww.thertoshowpodcast.com.
(54:43):
Go on there, see events, buysome swag, let us know that
you're listening, and make sureyou follow us on Facebook,
Instagram, LinkedIn, and nowYouTube where you're gonna see
this.
And I will tell you guys asalways, Wayland Russell, it has
been amazing to have you on theshow.
We really appreciate it.
Thank you.
SPEAKER_00 (54:59):
I'm I'm I'm honored to have been here.
Uh, and uh I hope that somewisdom comes through with it.
SPEAKER_01 (55:05):
Well, absolutely, absolutely, I guarantee it.
We'll tell you guys as alwaysget your collections low to get
your sales high.
Have a great one.
Hey everybody, welcome to the RTO show.
I'm your host, Pete Chao, andtoday, special guest legend, we
have Wayland Russell who hasbeen we're gonna have a story
for you.
It's gonna it's gonna manifestfrom little starts to a really
big ending.
And as you know, April is rightnow we're working with April to
get this legend series in hereso that we can get the
(02:33):
information to you so that youunderstand exactly what's going
on and exactly how we can startthis experience um from the
beginning.
And Wayland, you have a story totell, an excellent story to
tell.
Right now, as of right now,though, you are a co-owner of
Eagle Reynolds.
That's correct.
So I see Joe all the time.
Yeah.
(02:54):
Uh but a guy, he's a big guy.
He's a big guy.
SPEAKER_00 (02:57):
You know, uh I started out five foot six, but
uh, I was in martial arts.
I had to have two vertebratesremoved from my neck.
Last year I had three uh uhvertebrates fused in my back, so
I'm down to five, went the wrongdirection.
I started short, now I'm fivefour.
My partners are Randy Lewis,6'4, Joe Fisher, 6'3, and
Richard Morrow, who's 6'2, andI'm five foot four inches.
(03:21):
Well, we we look reallyridiculous together.
SPEAKER_01 (03:23):
I tell you what, what my wife's always told me
and trying to make me feelbetter, big things come in
little packages, right?
I think that uh God has alwaysblessed me to be a man of
stature, regardless of how tallI am.
SPEAKER_00 (03:34):
Exactly right.
SPEAKER_01 (03:35):
And we look for it.
SPEAKER_00 (03:36):
God don't make no junk.
That's it.
SPEAKER_01 (03:38):
That's it.
So you were a co-founder ofRainbow Reynolds.
Now, Rainbow Reynolds, in caseanybody doesn't know, ended up
with 100 plus stores that endedup uh changing names and in some
different acquisitions.
But I mean, Rainbow Reynolds inin what it was in the mid to
late 90s was the place to go.
SPEAKER_00 (03:59):
When we went public in June of '98, uh Renaissance
average store was bringing insix hundred thousand dollars per
year.
Aaron's was bringing in sixhundred and sixty thousand per
year, and Rainbow Reynolds wasdoing 1.3 million per year.
unknown (04:17):
Wow.
SPEAKER_01 (04:18):
I mean, we're talking double numbers.
SPEAKER_00 (04:20):
Yes.
SPEAKER_01 (04:20):
Wow.
Okay.
So in Rainbow Reynolds'existence, there was 124 stores
actually.
SPEAKER_00 (04:28):
Right?
We ended up with that.
We had we had we were not anacquisition story, we were a
grain field story, but we hadseveral acquisitions.
We bought Zoom, we bought WayneChambers uh stores down to own
and and some others.
So, but uh many of them were notthe sizes of our stores, and
they were very fragmented.
So we would consolidate those.
So by the time that uh we wesold to Rena Center in 04, we
(04:51):
were 124 stores, right at amillion dollars per store with
that, because we had several newstores and stuff like that.
So when when did RainbowReynolds get started?
Well, what happened was um uh Iwas uh at that time I was with
Crown Leasing uh for about threeyears.
(05:12):
I started in the industry onFebruary 1st, 19 uh uh 1977 with
uh Chuck Sims and Remco.
And and really before that, therent-owned industry stores
looked a lot like pawn shops.
And Sims was trying to reallybring that forward.
And uh uh and I I caught thatpassion then.
(05:34):
Uh and so um when my first childwas going to be born, uh, we
were from Canfield, Ohio.
So we we wanted to move back tofamily when my first child was
born.
So uh Ralph Devlin, uh thebrother of Tom Devlin and the
owner of Rena Center at thetime, offered me a position as
vice president of operations forRenner Center in the state of
(05:57):
Ohio.
So I moved up there uh back homeand uh worked with him for two
years.
And then I opened up ConsumerRentals in uh Cleveland, my
first store that I own of myown.
Very, very successful.
Uh one of the gentlemen, well,several of the gentlemen that
had worked with me at RennesCenter had left and went with
(06:18):
Crown Leasing.
So Jason Alford, who was a dearfriend of mine, uh a fellow
Christian and brother in theLord, he came to me.
He said, Let us buy consumerrentals, and we want you to come
uh and be in charge of MA at uhCrown Leasing and so forth like
that, and uh manpower.
(06:39):
Uh, they made me an offer and Itook the offer.
Uh and that was with Bob White.
Well, uh about three yearslater, him and Bob White fell
out of relationship.
And uh and because I was soclosely uh tied to Jason, I got
fired with him.
(07:02):
Uh so uh so I told him I said,let's uh let's start this
company.
And I said, uh, or he said tome, I don't have any money.
I said, I've got the money.
We'll get started.
So we brought in uh Jason, LarryHendricks, Mike Viveras, uh, and
(07:25):
uh we put in all the money, tookall the risk, and I gave 57.5%
of the clump company away thevery first day we opened up to
people that I knew that wouldtake to get to where we needed
to (07:38):
men of integrity, men of passion, men with great
experience, and strong, strongdisciplines.
That's important.
And uh so so uh Jason agreed tothat.
And his father was the pastor ofour church in Ohio.
So we started for two weeks at 5a.m.
(07:58):
in the morning, we'd lay down onour faces before the Lord and
say, we don't want this company,we want to work for you.
We want this company to be yourcompany.
So in 1986, uh we we opened upthe first store.
We opened up six stores in thesame month.
That's how we opened up RainbowReynolds.
(08:18):
Wow.
Six stores in the same month.
Wow.
And uh the very first store weopened up was in Boardman, Ohio,
and we had a young man by thename of Randy Lewis, which
delivered the first of twomillion customers of Rainbow
Reynolds history.
Wow.
unknown (08:34):
Wow.
SPEAKER_00 (08:35):
He was on one end of the TV, and Dan Hess was on the
other.
So we started and we werefounded on Judeo-Christian
(09:30):
values.
We didn't try to legislatemorality, we loved everybody.
Your personal uh life is none ofour business.
We're gonna love you, we'regonna treat you with respect and
dignity, and we're going toreward your accomplishments.
And that's what we did.
So you started fast.
You started really fast.
(09:50):
Well, yeah, because you know,we'd have been in the industry
for a while.
And we we the from the veryfirst day, we were going to be a
publicly traded company.
That was decided before weopened the first door.
We would be a publicly tradedcompany.
Uh, because that was the onlyway that we would be able to
share the company with ourfellow associates that would
(10:11):
build the company.
Right.
You know, right.
Uh, and uh we were blessed withuh the best of the best.
Our our turnover rate was like11%, unheard of in the age.
SPEAKER_01 (10:21):
Wow.
That yes of.
Yes.
As of right now, I mean, I thinkright now we're going through a
lot of of a turnover rate in thelast couple of years.
It's just skyrocketed.
SPEAKER_00 (11:19):
Well, you know, even our society, uh, you know, we're
not we're not trained any longerthat you start with a company
and you die with that company.
That's not the the mindset,right?
Uh, but uh because everybody wasso important at Raybo Reynolds,
there was no king and queens.
Uh, the reason that RayboReynolds became the great
company that it was was notbecause of the short Lebanese
(11:42):
Scotchman.
It was because of 1,200 peoplethat loved their company and
loved their customers.
SPEAKER_01 (11:49):
Culture is absolutely super important to
keeping a great business great.
You do not build a company, youbuild a culture.
That's it.
So you start you start there.
You know that you want tocreate, you find some people to
create with you, and you knowthat you're going to take it
public.
What were, you know, going tothis part in your life, what
(12:10):
were some of the mentors or someof the people that you knew that
you were able to model or talkto or rely on to help you make
these decisions and get to whereyou were?
SPEAKER_00 (12:21):
Well, you know, first of all, I surrounded
myself with people that Ithought uh had the experience,
the the uh the expertise, andthe quality of character.
So I surrounded myself withthose people.
And then the Lord brought uspeople.
I like to tell you that I'm sucha great interviewer that I can
pick out the best.
No, you know, it just the peoplethat came to us were
(12:47):
exceptional.
And there was one thing I wantedto see in the people,
particularly if I had to gooutside and hire from out of the
company.
Show me your passion.
Show me your passion.
People have resumes and theyhave work history.
Show me your passion.
It's so important.
Yeah.
So we we were able to fill ourcompany with passionate people
(13:09):
and we treated them as partners.
We never use the word employee.
Not ever.
You know, I I I don't if I'm ifI'm gonna hire a shepherd, I I
want someone that that thatloves the flock, not somebody
that's a hired hand.
And as soon as the wolf comes,the trouble comes, they book.
You know, I wanted people thathad a dog in the fight.
(13:31):
That's why I gave away 57.5% ofall of uh that that I owned,
really, to these people, becausethey needed to love this company
with a passion.
Uh, and that's what wasrequired, and they did.
And each person had their theirskills as as we went in into the
(13:53):
project.
SPEAKER_01 (13:54):
Is there any particular people that stood out
to you that you can say in thebeginning, these were really the
guys that and it sounds like youhad a lot of great people on
that team.
SPEAKER_00 (14:04):
Yeah, you know, I I knew everybody in the industry.
I, you know, I knew Tom Devlinpersonally and what drove him.
I knew Chuck Sims.
Uh, you know, uh I knew uh Mr.
Tally uh you know very, verywell.
And I I and I can't say that Ibought into everybody's ideas,
(14:25):
but I cherry-picked, and I wasable to see where the quality
was.
And we saw our missiondifferently than many people
that go into business.
We saw our mission to be theadvantage to the disadvantaged.
That's why uh we when we startedthe industry, started in the in
(14:50):
or rainbow rentals, all that wasout there was Dixieland
furniture.
That's what, and and we werebuying Mill Mean bedrooms, uh
inexpensive Ashley bedrooms fromuh uh from uh uh you know the uh
uh the the stock people thatwould uh buy the stuff.
(15:12):
We paid 30% more for them uhthrough these brokers, you know.
Uh and so we decided ourcustomers need to have the same
kind of furniture we want in ourhome.
So me, Larry Hendricks, who hada polio leg, and Mike Fivera
started walking the High PointFurniture Show every April,
every October, when nobody inthe industry was there.
(15:37):
And uh the only way you couldbuy furniture was you bought it
at the High Point Show for sixmonths.
It was, and every month it wasdelivered to one location.
I said, no, no, no, no.
We have 60 locations.
You have to deliver to everylocation every week.
I need, I need a dozen livingroom sets in 60 different
(15:59):
locations every week.
And for two years, for everyshow, walking and walking,
walking, we got no, no, no, no,no.
Until we went to EnglandCorsair.
And Rod England says, we can dothat.
We changed the world.
SPEAKER_01 (16:16):
How important was that meeting with Rod England
that that you got this one yesnow?
How pivotal was that to creatinga different gross set in what
you did?
SPEAKER_00 (16:28):
Well, just think of England Corsair.
First of all, they they pickedup 60 stores that that was, you
know, uh buying a dozen sets offurniture every single week.
Yeah.
All right, so that was a bigjump for them.
But what do you think happenedat Renaissance when they found
out that we had the qualityfurniture we had in our stores?
(16:48):
England Corsair got a call.
So then, and next thing youknow, Lazy Boy was buying
England Corsair.
Uh, and it launched them.
From those ideas, from that thatjust in time delivery and so
forth, Ashley adopted thatmodel, and that's why they're
the biggest furniture store byevery metric today, because we
(17:11):
changed the way furniture waswas bought, marketed, and
shipped.
SPEAKER_01 (17:16):
So when you when you go into England, Corsair, and
you say that you you want allthese sets, and I mean, they're
seeing the potential in this,they're seeing how we can really
make a difference.
How come is it that the othercompanies didn't see that value?
Because if you're coming to meand I'm selling furniture and
you're telling me you got 60stores and you want a dozen sets
shipped all the time, I'm gonnashake your hand and we're gonna
(17:40):
do business.
What prevented other people fromdoing that?
And what do you think it wasthat England said, hey, I see
the potential in this and I'mgoing with this versus others
who at the time really didn'tsee that value?
SPEAKER_00 (17:51):
Well, you know, working through distributors,
again, there's a 30, 35% markup,and you can only get what
they're gonna offer you.
Correct.
We wanted more better, differentfor our customers.
We wanted more, better,different for our associates.
We wanted more, better,different for our investors
later on.
(18:12):
And we worked hard to answer thequestion how can we be more
better different?
So the reason nobody else did itis that no one would do it.
It took two years of justtalking and preaching to these
manufacturers that we want todeliver to our customers your
(18:36):
products.
We don't want Dixielandfurniture, we want your
products.
I want a product that I would beproud to have in my home because
that's what my customersdeserve.
So we fought for it and wefought for it, and we found one
knucklehead that said I could dothat.
So Rod England and I, and uh anda guy by the name of Jim Carbot,
(18:57):
who called every one of ourstores every week to get the
order and then turn it in intothe company.
SPEAKER_01 (19:05):
You know, it's funny you say that because we just
talked about Ashley and howgreat they are.
I have guys that I've known foryears, and no matter where I've
worked in this industry, theywill call every single week.
Hey Pete, how are you doing?
What are you guys looking for?
This is what I have going on,this is what I have coming up,
this is what's coming out of thenext quarter, this is what might
be, you know, this is a drop inprice.
(19:25):
You guys want to jump on that?
I mean, it's just amazing.
When you have somebody who'swilling to work with you and
really willing to make adifference, those partnerships
can make some amazingdifferences.
SPEAKER_00 (19:37):
He knew every manager, loved them dearly.
They loved him.
He had to hire help, he had toget an office, hired help to be
able to do that.
We did millions of dollars withthem.
I mean, Rainbow Reynolds'average year, we bought$70
million worth of merchandise.
Average year, average year.
That is a good we we've been upto 94 million in one year of
(20:01):
buying merchandise and justpurchases.
Just yeah.
SPEAKER_01 (20:04):
Wow.
SPEAKER_00 (20:05):
Wholesale priced furniture.
SPEAKER_01 (20:07):
So we're talking about furniture.
So we're talking about the earlydays.
You know what you wanted to do.
Yes.
You got with some of yourpartners, you knew you were
going to be public.
57.5% out the gate.
You get six stores in the firstcouple of months, and we talk to
England, and and they say, Thisis this is the deal.
This is what we're going to do.
(20:28):
When did the trans, because thatthat is a huge deal at that
point in time.
Huge.
When did Rainbow Reynolds startstepping into technology?
The early TVs, the early washerand dryers, the early laptops.
SPEAKER_00 (20:39):
Well, you know, uh, when we would go to uh, and I
remember the first time, uh ormaybe not the first time, but
close to the first time I met uhNorm Smith from uh uh different
TVs that he was was selling andso forth.
And oh, you're rent-to-owned.
So they would take me to theMilba Toast console TV or
portable.
(20:59):
And I said, Listen, if you wantto do business with Rainbow, you
take me to the middle of yourline and go up from there.
We don't want anything belowmiddle.
Our customers deserve the best.
So we were we worked hard togive our customers the absolute
best product, and we collectedbetter than anyone else.
(21:20):
Our average car close was lessthan 4%, our bad debt was less
than 1.5%.
Wow.
Uh, and we collected better thananyone else because we did not
have bill collectors.
We had account managers thatwere supposed to get the
account, work with the customer,and get them to win.
Okay, so we were so efficientthat we could offer the better
(21:45):
products for less than Run aCenter was selling the Milba
Toast products.
Wow, that's that's amazing.
Yeah, all of those savings wentback to the customers.
Our job was to provide in thefuture our investors with a good
return on their money.
It wasn't to try to stack moneyup and see how much we can make.
(22:08):
It was we we have aresponsibility to make uh a
living uh uh for all of ourassociates, and we have a
responsibility to make a goodreturn for our investors.
So, which products came first?
So you're talking about the didthe television systems come
first and then Well, yeah, wewere the first to do rear
projection TVs in in the world,the very first retone company to
(22:28):
do that.
We were paying$3,000 wholesalefor a rear projection TV in
those days.
Yeah, yeah.
And what we did is we marked itup two times, and we only
initially rented it to existingcustomers as another unit.
And then we just kept ratchetingthe product up.
(22:49):
Then I felt as though we neededto get our low to medium income
customers into the computer agebecause I knew it was coming.
So uh what I did is I went toEugene Calabria, the CEO of um
uh Global Business Systems.
(23:10):
Most of the medical places yougo to are running GBS software,
global business systemssoftware.
And they were on the front pagewith Dell Computer.
So I told Eugene, I need to findsomething.
Because at that time, when youbought a computer, you got a
blinking asterisk in the topleft-hand corner.
And you all you can do is playsolitaire unless you typed in
(23:32):
Cobalt language, or it wouldn'tdo anything.
Correct.
Well, then my customers, thatwasn't gonna work.
Right.
And and and I was concerned mycustomers, more than anybody
else, needed their children tostay on on par with anybody in
the world so they can rise abovewhere they're at, possibly, and
have a better future.
So I went to him and I says, Wegotta, we gotta find a way to do
(23:55):
that.
He says, Well, let me make aphone call.
He calls Dell Computer.
So now on 224 in Canfield, Ohio,in my conference room, I got my
IT guy, Matt Pecia, who wasbrilliant.
Matter of fact, we wrote asoftware system that would trump
any software system that's heretoday.
I mean, I can tell you in aninstant exactly how many orders
(24:17):
was placed today, how muchmoney, so forth.
Uh, our our guys use icons toclick on and order their
merchandise.
And and it was all EMI.
That Whirlpool didn't even knowthe order came in.
We didn't know the order wentout.
It just went, it showed up onthe dock.
They shipped the stuff when theyaccept it.
If it matches, the computerspaid each other, and that was
(24:38):
it.
Seamless transactions, okay,with it with that software.
But now I'm now I'm in theconference room with Matt
Peccia, the director of IT forGBS, and Dell Computer in just
this little puny company on 224.
(24:59):
So Dell Computer went to workand they created four Rainbow
Rentals.
And by the way, nobody hadbundled software.
When you bought the computer,you got a blinking asterisk.
We set up uh strategic allianceswith Net Zero, Quicken, all of
that.
We were the first company in theworld.
Well, I let me qualify that.
(25:21):
Obviously, whatever Dell did forus, they proliferated to the
whole world at that same moment.
SPEAKER_01 (25:26):
Absolutely.
SPEAKER_00 (25:27):
But they did it for us, okay.
So, like at the exact samemoment that we were doing
bundled software, all of asudden it was being marketed to
everybody, which is good.
I mean, they did the work, theythey deserved to do that.
But we came up with this iconsystem for our customers to use.
So now our customers weresurfing the internet before
(25:49):
mainstream America was.
unknown (25:51):
Wow.
SPEAKER_00 (25:52):
And and and at the at that time, a direct quote, uh
uh Mark Speed of Render Center,I love the man, he's a good man.
He was telling the people on theon the conference call and so
forth that computers made goodboat anchors.
Bill Morgenstern from uh fromRentway said that computers in
(26:15):
the rent-to-own industry weregood doorstops.
Imagine how embarrassed theywere when we went public in June
of 98 and we were doing aquarter of a million dollars per
store in rental computers.
SPEAKER_01 (26:28):
And and if I remember the article that I
read, which actually came out inApril, um very close to that
year, was that I think it was2005 or something.
I can't remember the articletime, but they were kind of
going back over on how not onlydid you were a pioneer on that,
but it didn't just take off.
It was one of the higher sellinguh items that you had, one of
(26:50):
the lines that you had.
Oh, yeah.
SPEAKER_00 (26:52):
It immediately became 10, 12, 15 percent of our
income.
Right.
So, I mean, it was absolutelyhuge.
Uh, and um it it it justleapfrogged again.
The motivation for doing thatwas not to make a big pile of
money.
We hoped that it would, and wewere gonna try to market it
right and price it right, but wewanted to be the advantage to
(27:15):
the disadvantaged.
And as I say that, we looked onhow we could make their lives
more, better, different on aconstant basis.
So we saw the vacuum infurniture with the stuff that
was there.
We saw the vacuum in the low uhTV sets, the lowest
refrigerator, the lowest washerdryer.
(27:38):
We saw that vacuum and we wantedto fill that hole.
And now the industry has torecognize that AI is going to
create advantages for mainstreamAmerica that will leave the
disadvantaged behind.
(27:58):
This industry has theresponsibility to make sure that
we deliver those same advantagesto our low to medium income
customers that that are makingour livings for us every day.
They're our first concern.
Now, as an owner, uh you know,for me, I wasn't the most
(28:21):
impressive CEO you ever met.
You know, I most people wouldsay you can't even make the
heights requirement.
But but what what I saw for meis I was the band conductor.
I I could not play theinstruments anywhere near as
well as every one of them couldplay their instruments, but I
could help them make beautifulmusic together and they face the
(28:45):
audience, they get the applause,not you.
You're working for them, they'reworking for the audience, you're
working for them.
So the way that we had superiorcustomer service is we made it a
joy for every associate to cometo work every day.
They knew that they were loved,we expected the best out of
(29:08):
them.
When they didn't give us thebest, with respect, we told them
so.
But always treating everyassociate as a partner with
respect and dignity.
And the reason Rainbow Reynoldswas great was not its
top-of-the-heap management, itwas the the manager that greeted
(29:29):
the customer with joy every timethey came in the door and their
fellow associates.
And we we paid every singleassociate salaried.
Really?
Every associate of RainbowReynolds was on salary.
Sick or not sick, you got paidthe same.
(29:49):
Always.
A technicality that if youdeliver furniture, interstate,
you could be paid salary.
Every secretary, we had 67people in our home office, every
(30:12):
one of them made one deliveryevery year.
And we made them do it.
It wasn't just, you know, uhsaying it.
No, they had to do it.
And we got challenged withwaging hours.
And the lady that was comingafter us said, we have never
heard so many happy associatesas when we we were asking them,
(30:33):
you know, uh, don't you thinkyou would make more in an hour
with the hourly with overtime?
And they said, Oh, don't youmess with this, you know?
They they they loved theircompany.
And the reason that we did thatwas not to save money.
We did not want to buy ourassociates' loyalty one hour at
a time.
You understand?
(30:54):
If you're an associate ofRainbow Reynolds, you are an
intricate part of who we are.
You are important as anyoneelse.
So we're going to treat you withthe same respect and dignity.
We self-insured.
The most you could pay for, ifyou got six kids, the most you
could pay for for your healthcare is$3,000 a year maximum,
(31:17):
including doctor visits,prescriptions, everything.
SPEAKER_01 (31:22):
Wow.
SPEAKER_00 (31:22):
We hired an insurance company, I think was
Aetna, the last one was Aetna,and we took picked a policy, but
they weren't insuring it.
We had catastrophic insurance.
If you went over$50,000 as anindividual in one year, then the
insurance would kick in.
But until an individual wasgreater than$50,000, we had no
(31:46):
insurance.
And next year it starts overagain.
So we were self-insured.
We took every single associate,the manager, and their spouse,
male and female, manager and thedepartment heads on a cruise
every year.
About 300 people we took on acruise every year, and that's
where we remembered our culture,who we are, and why everybody's
(32:12):
important, and what is ourmission here?
Okay.
Uh it was the greatestexperience of my lifetime.
SPEAKER_01 (32:21):
I I it I love the sound of this.
I love the sound of the culture.
I love the sound of work.
You can tell the passion whenyou're talking about.
I can see it coming out of you.
So going back to the beginningthen, and starting over, because
these are all these are allamazing high points.
What were some of the hardestthings that you came across
during those times?
Like when when you when you'rewhen you're this is rocking and
(32:43):
rolling, right?
You've got England furniturecoming out.
You you're looking at the theTVs and telling them, listen, I
need something quality.
You're getting the larger TVs.
There had to be some trials andtribulations along the way.
SPEAKER_00 (32:52):
Oh, there absolutely were.
From the very beginning, wewanted to borrow$1.5 million to
get started.
Before ever I had a loanagreement, I already had$30,000
for the payroll before I evenhad a loan agreement.
So we go to Christ, the firstcorporate credit, and we want to
borrow$1.5 million.
Now, this is at the time, 1985.
(33:12):
So this is the deal we got forour money.
So they're going to charge me18% interest rate on my money.
I got to pay the attorney feesand so forth, which was$30,000.
I got to give them$300,000 of mymoney to put in a CD.
They're going to pay me 5% toloan it back to me at 18%.
(33:34):
And I had to give 15% warrants.
So now we had we had the Call attwo years and the put at three
years.
I calculated beforehand that bythe time we got to where the
call was, that those warrantswere going to be worth an
(33:55):
additional quarter of a milliondollars that they were going to
make.
I ended up calling calling it,or I'm sorry, the put was going
to be uh 250,000.
I called it after two years andpaid them an additional$400,000
after two years.
So calculate the interest rateon that.
I was paying 18% on$1.5 million.
(34:17):
They actually only loaned me$1.2, but I'm paying 18% on$1.5.
I paid$30,000 for their attorneyfees and so forth, and then gave
them$400,000 more after twoyears.
Calculate that interest rate.
That is, you know what wouldhave been more expensive money?
(34:38):
No money at all.
So the Lord blessed us, and wewe could say, you know, let this
is too crazy.
No, we knew that we weresupposed to do this, and that's
what we did.
Uh there we were, we had ourloans called twice.
We've never missed targets oranything for any bank or lending
(35:02):
institution.
Our last bank was Bank ofAmerica.
Actually, uh we ended up thelast one, was a consortium with
uh uh uh Ohio Bank, Comera Bank,and uh National City Bank,$40
million facility that we we hadwith those three banks uh at at
the time.
Um so when they call thesenotes, it was because, well, uh
(35:30):
one guy, I'm trying to rememberhis name, he was an accountant,
he had 220 stores uh uh with uhBank of America and uh another
one of the financiers, and he hewent bust.
So the next thing you know, ourbanks are calling our note.
That's normally the kiss ofdeath of any corporation.
They you don't have that kind ofmoney just laying around.
(35:53):
And uh and the second time itwas called, I think it was when
Henry B.
Gonzalez decided to hold Senatehearing meetings about the
legality of rent to own.
So now the banks want it out.
They said, we love you, you'vealways done what you're supposed
to do, they want it went out.
So we went out there trying tofind everybody we could find,
(36:18):
and we could not get the money.
We weren't going to get themoney.
So we went to the bank with ourtails tucked between our legs
and told them, we'll shut downall growth, we'll give you all
profits, and we'll have you paidback in one year.
They agreed to that.
As soon as they agreed to that,we have three banks call us back
with incredible interest ratesand so forth.
(36:40):
And Bank of America uh took ourtook our loan for about 5% at
that time.
Now, the reason we couldn't findanything is God is a jealous
God.
He wanted to make sure we knewthat we were blessed in that
situation.
(37:01):
The next the next situation Ihad, um my partner, who I dearly
love to this day, like abrother, decided to uh leave the
company after 11 11 years intothe project.
He was the bank guy.
He was the guy that kept the Iwas the operations guy.
I you know, products and peopleand all of that.
(37:25):
Uh so he leaves the company andwe have to buy him out, which
was$11 million at the time.
Oh okay, we gotta buy him out.
We had we had about$12 millionwith Bank of America, and we
(37:45):
probably were doing uh at thetime maybe$70 million a year.
So now I'm gonna have to borrowuh it would have been 12, uh
about$23 million on$70 millionof revenue,$60,$70 million of
(38:05):
revenue.
No bank would do that.
So I flew to Chicago to meetwith the the the, and they met
me a couple of times, you know,but but really I had to
reintroduce myself to them andsay, okay, now Jason's gone, and
now you got to loan me$24million.
Mike said, there there is no wayin the world.
(38:26):
They said, okay.
Michael looked at me, I lookedat him.
Now, the reason they did that isI'm such an impressive guy and
such a good speaker.
No, you know what?
We were a company founded onJudeo-Christian values.
We treated everybody withrespect and dignity and with
good intent.
And the Lord made that happen.
(38:47):
One year later, we took thecompany public for the highest
multiple uh rent a rent rentcompany ever had.
We, and there's another storythere.
You're talking about trouble.
We went out on the road show totake the company public.
We had the three topunderwriters on our book: Hunt
Robinson Humphrey out of out ofAtlanta, Dane Rosha Wessels, and
(39:08):
Sun Trust Equitable out ofNashville.
They were on our book.
I presented 65 times in 12 days.
One day I woke up in New York, Ipresented in Philadelphia, I
presented in Salt Lake City, Ipresented in Seattle, and slept
in San Diego.
One day.
One day.
Wow.
So it's the last day we'representing to a portfolio
(39:32):
manager in New York.
And he says, by the way, uhCooper Mills from Robinson
Humphreys called a specialconference call.
We've reserved our boardroomupstairs for you.
Uh, so right after yourpresentation, you can go up
there.
So I presented to him, went tothe top floor, and now this guy
(39:55):
from Youngstown, Ohio is lookingat a table with 40 chairs around
it.
The whole floor is glass and apanoramic view of the entire New
York.
And here's this this littleshort guy from Cantville, Ohio,
okay, with with Mike Peccia, uh,my chief financial officer and a
(40:17):
representative uh from uh uhRobinson Humphrey.
So he gets on the phone and hetells me, well, Whalen, this is
June of '98.
He said, uh, right now thedot-coms are all the rave.
Nobody's investing in anythingbut dot-coms.
There were 15 companies tryingto get out public.
(40:38):
Five have already delisted, fivehave downpriced.
We're not sure that we can getyou out in the price range of$10
to$12.
And we're we're really doubtfulthat we're going to be able to
get you out if you insist ontelling our investors that
you're going to give 10% oftheir earnings away to good
works every year.
(40:59):
I said, okay, okay.
Well, first of all, let me makesure everybody's on the phone.
Dane Rousher Wessels, who's onthe phone?
They told me who was on thephone.
It was the principals who wereon the phone.
Sun Trust Equitable.
I asked Larry Hendrickson, uh,my chief operating office, you
on the phone?
Yes, Will.
I'm on the phone.
Mike, my president, are you onthe phone?
Yeah.
Okay.
I want you all to understandthis.
The price is 10 to 12.
(41:20):
If you can't get that, don'ttell me.
Just send me a letter.
That'll be fine.
Mike, how much do I haveinvested in taking the company
public so far?
Mike said, about$780,000.
This isn't 98%.
Okay.
I said, right now, Rent ACenter, average store is doing
$60,000 per year.
(41:42):
Aaron's is doing$660,000 peryear.
Rainbow Rentals store, our 63stores are doing$1.3 million per
year.
And the reason they do that isbecause of our moral fiber.
It is who we are.
So if investors don't like that,we don't need their money.
And this phone call is over, andI hung up on them.
(42:05):
We came out with the highestparticipation of family and
friends they'd ever seen.
And we doubled shortly after wecame out.
We came out at$10 and wedoubled.
And then when we sold, wedoubled again.
Wow.
And the reason that we sold in2004 is I had a real conundrum.
(42:27):
I'm a publicly traded company.
Rent a Center is going to paydayloan, which they had every right
to do.
Aaron's is going to payday loan.
Rentway was going to paydayloan.
They were making 900% on theirmoney.
And we're saying we're a companyfounded on Judeo-Christian
values.
(42:47):
So I can't tell the investorsanything that I have is going to
make 900%.
I don't have anything that'sgoing to make 9%.
We outprofited all of them storeby store.
But I don't have a product thatmakes 900%.
I don't want a product thatmakes 900%.
So I had no choice.
It was time to sell.
And when we sell, when we sold,every every associate, even
(43:10):
part-timers, were rewardedhandsomely, stock options, and
so forth.
And we built a new high schoolfor Youngstown Christian School
with the proceeds.
Wow.
Because we weren't there tobecome personally wealthy.
We hoped that would happen, youknow, because the much is given,
much is required.
And you know, we love beingcharitable and philanthropic and
(43:30):
all of that.
But it wasn't about let's seehow much stuff we could acquire.
We wanted to build somethingspecial.
Wow.
SPEAKER_01 (43:39):
So when you're talking about, we're talking
about Henry Gonzalez out ofTexas.
And if anybody doesn't know,that was a period of time where
we were on the table andsomebody wanted to eat our lunch
or eat us for lunch.
SPEAKER_00 (43:54):
Oh, no question.
SPEAKER_01 (43:55):
Um, in that situation, were you a part of
April?
How did how did that come about?
SPEAKER_00 (43:59):
Yeah, you know, uh April was originally founded by
Chuck Sims and a few others.
So I was the store manager.
Every one of us, from so fromthe first day I entered this
industry, I was a member ofApril.
So I've been a member for 48years.
Wow.
Okay.
SPEAKER_01 (44:15):
So and back then, how important was it to be part
of an advocacy group like APROthat can really take these
challenges on head first andkind of help out with people
such as yourself to stop andreally educate uh the lawmakers
on what we really do versus whatthey really think we do?
SPEAKER_00 (44:36):
Well, you know, uh just getting in now, understand,
let's see, I became plantmanager of American Exochemical
at the ripe old age of 23.
So I was 26 when I entered therent rent-to-owned industry.
So we went to conventions and soforth uh with April back then,
and we didn't really realize howimportant April would be.
(44:58):
We just thought it was a tradeassociate, like all companies
do.
SPEAKER_01 (45:01):
Right, right, right.
SPEAKER_00 (45:02):
You know, we didn't realize, you know, obviously I
realized later on that if itwasn't for uh April and every
human being with April, that weEd Wynn saved this industry.
Uh Wayne Chambers saved theindustry.
They were going to, the IRS wasgoing to control us out of
(45:25):
business with the way theyexpected us to uh depreciate our
goods and so forth, we wouldn'thave been able to make a dollar.
They could have ruined us thatway.
The government had funded uhlegal aid in every state to
attack the rent-to-ownedindustry, to destroy us.
(45:45):
And Henry B.
Gonzalez was holding Senatehearings on the legality of our
transaction.
So we had a fight for ourexistence.
If it were not for April and thethe impassionate people there,
there would be no rent to ownindustry today.
SPEAKER_01 (46:02):
I agree with you 100%.
And I'm glad that you're a partof that.
So did you, aside Henry B.
Gonzalez, were you ever part ofthe groups that advocated for
either state regulation orfederal regulation to benefit us
and to educate the lawmakersthemselves?
SPEAKER_00 (46:20):
You know, we we we had people that went, but more
than anything else, we felt aresponsibility from our size to
fund it.
So uh you don't understand howmany millions of dollars that
went in to protecting ourindustry.
Thank God Renaissance was whatit was then.
And Charlie Lautermilk atAaron's was very, very generous.
(46:42):
More generous than RainbowReynolds.
We I think we carried ourweight, but you know, at that
moment in time we weren't as bigas when we sold.
Uh, but we we certainly hadpoured hundreds of thousands of
dollars into legislation and soforth, while Renaissance and
Aaron was pouring millions ofdollars into it.
(47:03):
Uh and this industry owes a debtof gratitude to specifically to
Ed Wynn and specifically toWayne Chambers at that at that
time, and certainly so manyothers, but those two men uh ran
point for us on some verydangerous soil.
SPEAKER_01 (47:24):
So, how did how did Rainbow Reynolds and yourself
get the narrative through whofrom people just like that?
We're not just talking about thelegal side, but there was always
that that connotation that, youknow, rent-to-owned, we're
taking advantage of customers.
How did you break through thatin different situations to let
people know that this is whatour business, our industry, our
(47:46):
people are really doing?
SPEAKER_00 (47:48):
What I try to explain to them is that any bank
that's going to loan you moneyis going to measure your beta or
the risk involved, your abilityto pay back.
Okay.
So in our industry, there is nodebt, but we need to get our
merchandise back.
(48:08):
Okay.
So when we send something to acustomer, we price that at the
very best price that we can.
We service it, we stand behindit, and we will take it back
when you've used half of it ormost of it, or whatever the case
may be.
So there's inherent risks inrenting the merchandise that
(48:35):
we're taking, that when you buya piece of merchandise, you're
taking risk.
So we charge extra for thoseservices that we offer.
But when you take into accountwhat's in your wallet, if you
make the minimum payment everysingle month, they're going to
increase you to 32% interest andyou will get nothing for that.
(49:00):
So if you think we're expensive,look to American Express and
Diners and MasterCard and Visa.
And if you want to talk aboutusury, that's usury.
That taking people that maybehad a problem.
My own sister, her husband diedin a tragic tractor accident.
(49:21):
Sorry, and expenses were comingin, so she ran up her credit
cards and made a payment everysingle month.
She was making a minimum paymentevery single month and she was
paying 32% every year on thatdebt.
I said, give me those bills.
(49:44):
Paid those off.
She's never had a balance on acredit card since.
And there's a lesson in that forus.
There are 40 million people outthere today with with greater
than$7,000 on their credit cardsright now.
And they're getting nothing fortheir money.
Those 40 million people shouldbe our customers.
(50:06):
We have to find a way to get tothem and tell them it's
acceptable and even wise to usethe rent-to-owned transaction
rather than put it on yourcredit card.
Your best thing you could do isget a home mortgage.
That's the smartest thing.
Even better than that, pay cash.
(50:27):
But if you're not in thatposition, don't put it on a
credit card.
Come to Eagle Runnel Purchase.
There you go.
There you go.
SPEAKER_01 (50:37):
What would you say is some advice with all the
information, all the historythat you have gathered?
What is something that you wouldwant to pass on to somebody in
the future?
Somebody that's coming throughnow, somebody that says, I want
to open a store, I want to be inthis industry.
Um, what would be some of youradvice to them?
SPEAKER_00 (50:55):
You know, I don't know where I heard this, but it
was from someone very wise saidto me, You can get all you want
in this life by just helpingthem enough of other people get
what they want in the life.
So treat everybody with respectand understand you can do more
together than you will ever doby yourself.
(51:18):
I'll give you this one laststory.
One time we had our the secondtime we had our loan call, I
went on the bike trail as Inormally do, and I ran eight
miles before anybody was atwork.
And we we had called for anexecutive meeting for everybody
to talk over what we would do,how we would go about it.
(51:39):
So while I'm running this eightmiles, I have an epiphany.
I've got the answer.
I can't wait to get to ourmeeting with the executive
group.
So I go in my conference room, Iput on the chairman hat, and I
started listening to the ideasto my left.
By the time we got to the leftcorner of the table, I'm not
sure I had the best idea.
(52:00):
By the time we got to the rightcorner, I'm not going to tell
anybody what my idea was.
And and I will tell you, in allof the years, I don't remember
ever picking my idea one time.
Not once.
I didn't have to.
All my only job was to pick thebest looking pig on the truck
and go with it.
(52:21):
But you know what?
If it was your idea, we weapplaud that, and it's no longer
your idea.
It's our idea, it's ours.
And we would go from there.
So surround yourself with thebest and help them be great.
Don't worry about your owngreatness, help them be great.
(52:41):
Words of wisdom.
SPEAKER_01 (52:43):
So in the end, as we come to a close, not a selfish
question, but I do want to know.
How do you want to beremembered?
If somebody says, you had achoice, and and usually we
don't, usually it's the actionsthat have created, we've done
throughout our entire lives,that have put us into where we
(53:04):
are now.
And then the people who look atus, that know us, that have been
with us, our family, ourfriends, our loved ones, they
get to say, This is how Iremember you.
But if you had the ability tolook back at your life, which
you do, and and and say, This iswhat I think I would remember,
be remembered for, this is whatI think I would like to know
that people would probably saythis about me, what would that
(53:26):
be?
SPEAKER_00 (53:26):
I think I'd like to be remembered as a less than
bigger than life CEO that knewthat his job was to make others
great, not to be great.
So if on my tombstone, if theyput here lies a guy that made a
lot of money, then I had wastedmy life.
You you have just indicted me onmy own tombstone.
(53:50):
Here's a simple man that trustedGod and did his best to bless
others.
That's the way I'd like to beremembered.
I think you will.
SPEAKER_01 (54:01):
Well, everybody, we uh I I can't imagine somebody
else who has gone through thethings that you have gone and
really able to accomplish thingsthat you have uh in the way that
you have.
I mean, Rainbow Reynolds, Iremember when I first came on,
uh, I actually started atRenter's Choice under Ernie
Talley.
So if you say the name ErnieTalley, it takes me back to
those days, the early, right atthe early two.
(54:23):
I actually started in January of2000.
Um, and it just it just bringsback so many memories because
that was a good company and itwas some good leadership.
And we're really glad you guyshad time to sit in with us.
Listen, if you want to connect,by all means, reach out to us,
Pete at the rtoshowpodcast.com.
Don't forget to the website iswww.thertoshowpodcast.com.
(54:43):
Go on there, see events, buysome swag, let us know that
you're listening, and make sureyou follow us on Facebook,
Instagram, LinkedIn, and nowYouTube where you're gonna see
this.
And I will tell you guys asalways, Wayland Russell, it has
been amazing to have you on theshow.
We really appreciate it.
Thank you.
SPEAKER_00 (54:59):
I'm I'm I'm honored to have been here.
Uh, and uh I hope that somewisdom comes through with it.
SPEAKER_01 (55:05):
Well, absolutely, absolutely, I guarantee it.
We'll tell you guys as alwaysget your collections low to get
your sales high.
Have a great one.
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