Taking the back road: how one CEO's love of travel inspired a company that offers vigorous activity with all the comforts of home - Executive Life - Tom Hale of tour operator Backroads - Company Profile

Chief Executive, The, Jan-Feb, 2003 by Catherine Fredman

An uphill ride

For a long time, Hale's own destiny was in doubt. After his early morning epiphany, Hale abandoned his day job as an environmental planner in Las Vegas, pumped up his bike tires and pedaled more than 5,000 miles around the Western states to scout routes and plan Backroads' first trips. His initial advertising campaign yielded six customers for the inaugural biking and camping trip to Death Valley the following March. It was so windy one night on the trip that a tent blew away during dinner. But a feisty 65-year-old woman signed up for the next tour--and Backroads had a future.

It was an uphill ride and a wobbly one at that. Backroads was a quintessential start-up, capitalized on credit cards and loans from friends and family. The bikes were stashed in the basement of Hale's house in Oakland and the office was in the garage. "I ran out of money every winter for the first five years," Hale remembers. But by the late 1980s, active travel took off and Backroads blossomed.

Then, like many entrepreneurial ventures, it tripped over its own success. "When you're in a growing, thriving business, there's the temptation to think that you can do everything better than everyone else," Hale muses. "Beginning in 1990, we branched out into other areas with a vengeance." Backroads started a retail bike shop in Berkeley to unload the used bikes from a fleet of custom-built Cannondales that completely turns over every three years. It sold T-shirts, bike gloves, helmets and other merchandise on trips and by mail order. It segmented its offerings with trips for students, for people over 50, for solo travelers and for families, as well as bike trips focusing on art, photography or fitness. It pioneered a multisport concept with a "Go Active Sampler" featuring 15 sports in five exhausting days. There were both camping and inn-based trips to the same destinations. There were even walking trips.

"It's fun getting into new things," Hale says. "But while there were good reasons for Backroads to get into certain activities, about four years into our diversification it became apparent that there were even better reasons for getting out."

The "Go Active" trips were a perfect example. "A bunch of us were out taking a trail run and thought, 'Wouldn't it be great if we could put all the things we like to do into a one-week trip?" Hale recalls. "The trip we developed was great, but the market was too small for that kind of experience." Similarly, while the retail bike shop was one of the best in San Francisco's East Bay, Hale and his team realized that a nationally oriented company had no business focusing so much attention on a local enterprise, especially when it was not as profitable as the core trip business. Meanwhile, management expertise was stretched to the limit, threatening the efficiency of the operation and the customer trip experience.

Hale pulled the plug. "Our theme before was that we could do anything, and we would do whatever it took to make it happen. If you apply that to what matters, that's great. But if you apply it to the whole wide world, it will put you under," he says. "We now focus our energy only on the things that make a great deal of difference to Backroads, and we're able to leverage our expertise in a manner that really plays off our strengths. When we add trips, we already have the great leaders and hotels, we're often in areas where we have regional expertise and we use the same equipment. The marketing channels and demographics among all those offerings are quite similar. It makes sense to expand into those areas."