Filling work orders: Deep industry roots gave search firm CEO strong foundation for healthy growth

The Daniel Group in the Houston Business Journal

By Tanya Rutledge
Originally Published in The Houston Business Journal - January 6, 2012

When Jarrod Daniel joined his father’s executive search firm in 1994, his first order of business was pretty simple: to buy some computers and pens for the office.

Daniel’s father, Bill, had founded what was then called William & Associates in 1980 as a sole proprietorship focusing on executive searches and direct-hire placements. The elder Daniel was running the company with a system that involved only paper and pencils rather than computers or any technology.

An accountant by trade, Bill Daniel created a successful business in his own right, but had shunned any notions to change the way he did business over the years.

That is, until Jarrod Daniel joined him in 1994.

“I came to work, and it was just him and his paper files ­— no computers — and everything was done in pencil,” Daniel said. “So I spent the first two or three years just putting everything into a software system and creating databases of clients, candidates, marketing and accounting information. It was a big effort.”

Despite the monumental conversion task, the father and son also managed to grow the company during those transitional years, primarily by expanding into new areas of the industry. While Bill Daniel focused on direct-hire placements, he asked his son to help him enter the contract staffing business, which created a more consistent revenue stream.

“The idea was that if we grew the company into the contract staffing business, there would be something of value to one day sell,” Daniel said. “We wanted to build value so my dad could one day retire.”

That retirement day came about two and a half years ago. But instead of selling, Jarrod Daniel took over the company.

While the father and son worked together, The Daniel Group, so named in 2009, grew in both size and scope, sprouting several offshoot companies that provided related human resources and staffing services.

The first offshoot came in 1997, when Daniel visited his mother in Beaumont, where she worked in the prison system. Wanting to help get her out of that environment, Daniel opened a staffing company there and put his mother in charge.

The Beaumont company became so successful that three years later Bill Daniel bought it from Jarrod Daniel, swapping full ownership in what was known at the time as Dan Temps Inc.

“That was the first 100 percent entrepreneurial move that I made on my own,” Daniel said. “It was true entrepreneurialism because I did it on my own, and it became so successful that I sold it back to my dad.”

While the father and son proved to be good business partners over the years, Jarrod Daniel wasn’t as lucky with some of his other partners, which he said taught him some valuable lessons.

For example, Daniel’s partner in a 2002 business that focused on direct-hire placement of accountants picked up and moved to Pennsylvania with little warning after getting married, eventually forcing Daniel to close that company.

“I definitely became more careful in taking on new partners, but that experience did not cause me to shy away from taking on new opportunities,” he said. “I have always been aggressive in my career about trying new things — that’s how we learn.”

Those lessons continue to pay off. The Daniel Group grew by 125 percent between 2008 and 2010, earning it a No. 22 ranking in the Houston Business Journal’s 2011 Houston Fast 100.

Daniel credits a big share of the company’s growth to his and his father’s willingness to enter new areas of the industry. The company now generates about 90 percent of its business from contract staffing work and 10 percent from direct-hire placements, but is also involved in other lines of business, including providing contractors to trades such as construction workers and electricians and also a ramped up effort into government work. In addition to the Houston office, The Daniel Group has offices in Atlanta and San Antonio, each of which have their own partner.

Now that Daniel is helming the company, he also spends a lot of time staying involved with networking groups, including the Houston chapter of the Entrepreneurs’ Organization — in which local entrepreneurs from different industries meet and share ideas on running a business — and an industry-specific CEO group that brings together staffing-industry leaders from around the country to brainstorm ideas.

Daniel said it was during a meeting of the Entrepreneurs’ Organization that he learned one of the keys to running a business: delegation.

“Entrepreneurs always talk about how to balance life and work as their responsibilities grow, and the key to that is delegation,” he said. “I learned that you have to let go of some things and admit that there are actually other people who can do certain things better — and I have to let them do that.”

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