Afterword: Bob Kierlin on Building Fastenal Without VC
Book: Finance Secrets of Billion-Dollar Entrepreneurs: Venture Finance without Venture Capital
Author: Dileep Rao
ISBN: 978-1-64250-199-5
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The afterword is not written by Rao. It is from Bob Kierlin, CEO and cofounder of Fastenal. And it might be the most convincing page in the whole book.
$31,000 and a vending machine idea
Kierlin started Fastenal in 1967 with $31,000 from his savings and investments from four friends. The original plan was to sell nuts and bolts through vending machines.
A few weeks in, he realized vending machines would not work. Too many varieties of fasteners to fit in one machine. He pivoted and opened a retail store instead.
At the time, they had about 10,000 competitors. In time, Fastenal became the largest fastener company in the country with sales of more than five billion dollars. All of it with no other external financing.
They did have an IPO, but Kierlin says it was mainly to let employees buy stock and share in the wealth they were creating, and to fund an educational foundation. Not because they needed VC to survive.
Skills over funding
Kierlin says they grew with the skills and strategies noted throughout the book. He praises Rao for analyzing his experience and that of many other unicorn entrepreneurs in the US.
His message to readers: this book shows how to build a growth venture, even a billion-dollar venture, with internal cash flow and capital you control.
The world has changed, but the math has not
Kierlin acknowledges the world has changed since 1967 and that more venture capitalists exist today. But he points out what the book documents throughout: very few entrepreneurs get venture capital, and even fewer succeed with it or gain from it.
Your best option, he says, is to get the skills and use the smart strategies Rao lays out.
That is it. No theory. No framework. Just a founder who started with $31,000, pivoted in weeks, competed against 10,000 rivals, and built a five-billion-dollar company without outside money.
Hard to argue with.