07/09/2018
Ken Woolley | Founder & Chairman of Extra Space Storage
Ken grew up in Northern California’s Bay Area, eventually receiving his M.B.A. and Ph.D. from Stanford in Business. Simultaneously, he obtained a California Brokers License because he was drawn to real estate. He was aware of the self-storage industry in California, but when he moved out to Boston after college he saw that there was a gap in the market on the East Coast. This piqued his interest in the industry.
After opening up the first Extra Space Storage in Billings, MT in 1977 in a partnership with his boss at the time, Ken went on to teach at Brigham Young University (BYU) in Utah. There, he continued growing Extra Space, until sky-high interest rates slowed down development in the early 1980s and again in the early 1990’s.
“I didn’t think it through very well… but you know, sometimes when you’re an entrepreneur you don’t have a good long-term strategy. You’re just trying to survive.”
THE MODERN EXTRA SPACE
Inspired by the corporate strategy class he was teaching, Ken realized in 1998 he was serious about growing Extra Space. He needed money, a good management team, and a partner to help him. Diane Olmstead of Arthur Anderson Real Estate Capital Markets Group helped Extra Space bring a financial partnership with Prudential Real Estate Investors. Spencer Kirk joined as a partner in order to put the team together, while Ken as CEO focused on acquisitions, development, and financing.
“We spent a lot of time working with employees, employee benefits, and employee motivation, and I think that that has paid huge dividends for us. Second of all, we always had a philosophy of being fair in any business transaction… we really internalized the idea that when you have a contract or business relationship, you’re always fair to the other guy.”
In the same way that you trust a Marriott Hotel, Ken recognizes that the secret sauce for success lies in the reputation of their business name.
Because its tenants don’t talk to one another, Extra Space can leverage technology to offer different prices and promotions based off of certain customer’s characteristics and the self-storage product they want to purchase. He credits this sophistication and tailored-pricing to why they are outperforming others in their industry.
ADVICE
Woolley is a serial entrepreneur and has a plethora of experience in industries including airlines, technology, mining, fast food, and more. But storage is the one thing he knows best and to be successful in real estate, he puts a lot of emphasis on having a good education and a lot of experience.
“If you want to be in real estate, there are two ways to approach it. Number one is start from the ground up. And that means you start developing small things with small partners. The other way is to get a job with a real estate company, learn the ropes, and then go off on your own.”
