The FORT Podcast – Walt Reynolds – Former CEO @ The Reynolds Company – From Family Business to Industry Giant
Walt Reynolds is a senior leader in the electrical supply industry with over 30 years of executive experience. In 1998, he became President of The Reynolds Company and drove its explosive growth over the next two and half decades. Under his leadership, the company became one of the largest independent electrical distribution companies in the United States with 34 locations across Texas and Southwest US.
We discuss:
– Walt’s career and building The Reynolds Company
– Acquisitions theses and buying bankrupt companies
– ESOPs
– Leadership principles
– Working with friends
Listen on:
Spotify
Apple Podcasts
YouTube
Topics:
(00:00:00) – Intro
(00:04:30) – To know you is to know your father
(00:08:50) – The history of the Reynolds Company and the electrical supply industry
(00:20:39) – Walt’s career
(00:43:43) – Scaling Reynolds
(00:48:29) – Working with your friends
(00:52:16) – Pivoting into acquisitions
(01:01:47) – Selling the business
(01:08:14) – ESOPs
(01:11:55) – Walt’s role post-close
(01:16:05) – Leadership Principals
Episode Summary:
The conversation began with Walt Reynolds recounting his family’s history in Fort Worth, where his father started working for his grandfather’s company, Cummings Supply, an electrical supply business. After a brief stint in Dallas, Walt’s father moved to Odessa in 1966 to manage an electrical supply branch there. This laid the foundation for Walt’s future involvement in the business. Walt himself joined the company in 1989 after finishing his business degree at the University of Texas. Initially hesitant to work for his father, Walt was convinced by his father’s determination and vision for the family business. He began his career working in various roles within the company, learning the ins and outs of the electrical distribution industry.
The Reynolds Company, founded in 1984 by Walt’s father, started as a small commercial electrical distributor in Dallas. Over the years, the business expanded its offerings to include industrial and automation products, securing major contracts with manufacturers like Rockwell Automation. Walt described how the company’s early growth was driven by large construction projects, such as the electrical work for Reunion Tower in Dallas. This success positioned the company as a key player in the regional electrical supply market.
As Walt took on more leadership responsibilities, the company continued to grow through both organic expansion and strategic acquisitions. He explained how the company took advantage of downturns in the market to acquire struggling competitors, particularly during challenging periods in the oil and gas industry. By purchasing financially distressed companies and turning them around, the Reynolds Company rapidly expanded its footprint across Texas and the Gulf Coast region. Walt emphasized the importance of identifying opportunities during economic downturns, noting that the company’s willingness to take on risk helped it grow significantly over the years.
A major turning point for the Reynolds Company came when Walt and his brother Donald took control of the business in the late 1990s. They were approached by General Electric with an offer to buy the company, but after considering the valuation, Walt and his brother decided to keep the business and continue growing it independently. This decision proved to be pivotal, as the company experienced tremendous growth in the following years. Walt highlighted this moment as a key realization of the company’s potential and their ability to build something lasting.
In addition to organic growth, Walt discussed the company’s acquisition strategy, which focused on purchasing bankrupt or struggling businesses in contiguous markets. This approach allowed the Reynolds Company to enter new territories and increase market share without taking on excessive financial risk. The acquisitions were carefully selected based on market conditions and potential for turnaround. Walt shared that this strategy was critical in growing the company to its current size, with 34 locations and substantial revenue growth.
Walt also touched on the company’s decision to transition to an employee stock ownership plan (ESOP). This move was driven by a desire to maintain the company’s legacy while ensuring long-term stability and growth. The ESOP structure allows employees to become partial owners of the company, which in turn helps drive employee engagement and retention. Walt emphasized the importance of fostering a strong company culture and the benefits of employee ownership, particularly in attracting and retaining top talent. The ESOP has become a key competitive advantage for the company as it continues to expand.
One of the most significant aspects of the podcast was Walt’s leadership philosophy. He discussed the importance of authentic leadership, trust, and continuous development. Over the years, he has focused on cultivating a leadership style that emphasizes vulnerability, openness, and clear communication. Walt believes that leaders should be transparent with their teams and encourage collaboration and trust at all levels of the organization. He also highlighted the value of investing in leadership training and development, noting that it has been a critical factor in the company’s success.
Walt’s approach to leadership extends beyond technical knowledge and business acumen. He spoke about the importance of self-awareness and personal growth in leadership, encouraging leaders to embrace authenticity and avoid the “imposter syndrome” that many face when stepping into leadership roles. By fostering an environment where leaders are encouraged to be themselves and admit when they don’t have all the answers, Walt believes companies can create a culture of trust and collaboration that leads to long-term success.
Throughout the conversation, Walt underscored the importance of strategic thinking, adaptability, and taking calculated risks. He shared several examples of how the Reynolds Company navigated market fluctuations, leveraged industry relationships, and stayed ahead of technological changes to remain competitive. In particular, Walt discussed the company’s early adoption of new technology, such as barcoding in warehouses, which helped streamline operations and improve efficiency. This forward-thinking approach has been a hallmark of the company’s success, enabling it to stay competitive in a rapidly changing industry.
Walt’s reflections on his career and the growth of the Reynolds Company provided valuable insights into the importance of resilience, strategic planning, and leadership development in building a successful business. His story highlights the impact of family legacy, the challenges of running a family business, and the opportunities that arise from staying committed to long-term goals while remaining adaptable in the face of change.
The FORT is produced by Johnny Podcasts