As a teenager, Michael Rouse found himself in a terrible jam. He needed $3,200 to attend a national tennis competition, one that might lead to a college scholarship. But his Dad wouldn't front him the money. Earn it yourself, he said.
And that's how Rouse's business began. Rouse now leads ESF Inc., the Bryn Mawr based company that runs 63 camps for thousands of campers in six states. This summer, interestingly, ESF is bringing in the Jack Welch Management Institute to teach entrepreneurism in a specialty camp, the Junior Business Academy. Rouse could run that camp himself, if he didn't have 62 other ones to operate over eight or nine weeks in the summer.
So, let's hear the story. How did you start?
One particular summer, I needed $3,200. I went to my Dad and said, `Do you want the good news or the bad news, dad?' I was 15 years old. He said, `What’s the bad news? I said, `The bad news is I can’t work this summer.' He said, `Well, what’s the good news? I said, `If I go to these nationals, I could get a national ranking and eventually I could get a free scholarship to college.' He said, `Well, if you don’t, you’re going to be paying for college.' I said, `So, what do you think? Do you think I could borrow some money?' He said, `No, you’re going to have to work for that money in order to be able to do what you like to do. I can’t just give you a handout.' I said, `Well, what do you think I could do?' He said, `You should so something you really love to do.' I kind of went to sleep that night thinking about what I was going to do.
When did this conversation take place?
This was in probably February of 1982.
Okay. Then what?
Prior to that, my brother and I would do a little tennis camp here and there on a Saturday morning when we had a house in Ocean City. That was kind of easy. I thought to myself that night, `I’ll just do a two-week tennis camp at the school I go to.' I went back to my dad and I said, `I’ve got an idea. I’m going to run a two-week tennis camp.' He said, `Well, what courts are you going to use? I said, `I’m going to use Haverford School's.' He said, `What are you going to do? Are you going to rent the courts?' I said, `No, I’m going to borrow the courts.' He said, `Borrow? You mean rent.' I said, `No, I don’t have any money. So, I want to borrow the courts and then I’ll give the school money afterwards.' He said, `Well, what you really should do is make a proposal to the school to say you’ll give them a percentage of what you make, then you can actually consider them as a partner.' I said, `All right, explain that to me again.' So, he did. He said, `You should really see if that works.' I said, `Okay, thanks. '
How did your negotiations with the school go?
So, that day I went to school and I had a headmaster who was always punching your lunch ticket when you were in the lunch line. It was funny because nobody would ever go into his lunch line. They would always go to other teachers. I would always go his lunch line. There was really very few people there. At the time, I just walked up and said, `Hey, Mr. Parker.' He would always say, `Good game yesterday,' or `How’s it going?' So, I said on this particular day, `Mr. Parker, would it be okay if I could…?' And I froze. He said, `What?' He was like almost seven feet tall. I said, `Do you think I could borrow the tennis courts this summer? He looks down at me and said, `Borrow? You mean rent.' I said, `Well, it’s a longer story.' Could I ever talk to you about it? He said, `Yeah, yeah, just set up an appointment with my assistant.'
Then what happened?
So later that week, I walked in eight poster boards: Why the Rouse brothers need to borrow the tennis courts at Haverford School. Number one, we need to make money. Number two, we’re students here. It would be a great advertisement. Number three, the courts are just sitting here. Number four, we need to make money. Number five, there’s nothing like it. There’s no tennis camp in the area.
So, I got to number 67 out of 85 things on these poster boards and he said, `Stop. If you go to 68, I’m going to say no.' He said, `I’ve said yes three times. So, business 101, you need to listen first. He said, `So I’m going to let you do this, as long as we the following three things.' I said, `Okay, what are they?' He said, `Number one, I need you to give the school a donation at the end of the summer.' I said, `Okay.' We settled on that.
Number two, he said we needed to be on [Haverford's] insurance carrier. I said, `What’s that?' He said, `It’s a $100,000 policy.' I said, `Mr. Parker, if I had $100,000, I wouldn’t be here.' He said, `No, you’re going to be on our carrier, so it will cost you about $100 and we’ll put you on our insurance.' I said, `Oh, perfect, great.'
Number three, he said, `I need to be sure that you let these two children, who I know, whose mother works at night. She works two jobs. She cleans bathrooms here at night, but during the day she has another job. I want those two kids to go for free.' I said, `What’s two extra kids? No problem.' He said, `All right, just make sure you do those three things.' That was the beginning of something.
Wow. Did you make the $3200?
I did. I did. So, long story short I had to convince the mother to let the two kids come for free and she was never a tennis player. She never even knew what tennis was. I ended up trying to convince her by giving her my tennis rackets that I got for free, some tennis sneakers that I got from a manufacturer. Finally, these two kids showed up. It was like Christmas for them. The other kids were 40 other kids from the area: Havertown, Gladwyne, and it was those two children who actually changed the behavior of everybody else, because [on the first day] it started to rain. It rained at 9:15 and we started at 9:00. I said, `Oh, my gosh, we’re going to go inside the gym, you guys, and we’re going to play tennis baseball.' I could see some kids saying, `Tennis baseball?' I turned to Rashida, one of the little girls, and she said, `Tennis baseball!' She literally turned the entire environment of kids to be really excited.
So, we ended up going into the gym and I was looking at my brother. `This is pretty easy.' But we were fortunate because of the fact that we had really good staff with us. We knew what kids wanted and that was fun activities. We knew that it needed to be really well orchestrated. So, we designed theme days and special events and ice cream parties. Then we also knew that if we screwed up, we were in big trouble, not only from my parents, but the school and then also the [campers'] parents.
So, it was almost like the fear of failure was right there. We were never going to let that happen, because we were going to really work hard. So, that’s kind of how it began. We had 42 kids.
And how did it start to grow?
That winter, the head of the school said, `You should do it for six weeks,' and that’s when it kind of evolved. The school eventually said, `You should add some more things.' We started to listen to our customer base, who said, `Do you have anything for my older son? He doesn’t want to go to overnight camp.' So, we created senior camp. We had other schools calling us. Then the head of school introduced us to other heads of schools.