Dr. Barry Lall is the founder, president and chief executive officer of Pinnacle Hotels USA, a hotel management company headquartered in San Diego, California. What started with the purchase of a small 12-room motor lodge has today grown to an operation managing nearly 1,800 rooms and seven restaurants across nine properties in California and Texas, working with some of the best hotel brands in the market today.
Born in the British colony of Nyasaland in southeastern Africa, Lall grew up in a small village where neither running water nor electricity was available. When he was a teenager he and his family moved to Zambia, and after graduating high school he moved to England to attend university. At the time, Lall believed that he was limited in his choices of professions, having been taught by his parents that a career with security such as a lawyer or physician was the best way to succeed in life. He earned a pre-med degree and then enrolled in medical school in Glasgow, Scotland before moving to Augusta, Georgia in the United States for a medical internship.
Settling into Southern California with his family, Lall worked hard to provide a good life for them but found that his career in family medicine weighed heavily on him while not bringing him any sense of joy or satisfaction. He felt a pull toward entrepreneurship, and after seeing an ad in the local paper for a beach motel that was priced to sell he jumped on the opportunity. For a time, Lall continued to work as a physician while also learning the ins and outs of running a business, refurbishing the motel and doing everything from covering breaks and working the front desk on the night shift to running loads of laundry and even cleaning the guestrooms.
Lall’s tenacity paid off, and he had soon turned the run-down motor lodge into a successful business. He parlayed this accomplishment into new opportunities, forming a hotel company with two of his friends in which each focused on purchasing distressed hotels in different regions. Lall’s efforts were focused on the Southwest, and he moved his family from their oceanside home in San Diego to three hotel rooms in a recently purchased hotel in Tucson so that he could devote himself entirely to running the property.
In three short years Lall and his partners were able to take their profits and reinvest them in 26 underperforming hotels across the country, and in 1998 Lall incorporated his own business, Pinnacle Hotels USA. In its early years, the business was focused on investing in limited and select-service properties, but as time passed and Lall’s views on business evolved he began streamlining operations and fine-tuning their expertise in the premium brand and full-service market.
Where did the idea for Pinnacle Hotels USA come from?
I believe the desire to be an entrepreneur has always been within me. My father owned a clothing store when we lived in Zambia, and when he went away on business or to India he would leave me and my mother in charge. Now, you would think at my age as a teenager I would see it as a bothersome chore, but I actually loved it. But in that time and place owning a business wasn’t something you aspired to. I didn’t even know you could study business in school –– I thought if you went to college it was to become a lawyer, an engineer or a doctor. Everything changed for me when I moved to America. It’s called “the land of opportunity” for a reason, and I was immediately energized with the presence of vast opportunity the minute I stepped off the plane into the country for the first time. It became my dream to develop my own organization through which I would own and operate various businesses and real estate, I just needed to find a way to take that initial first step. I suppose that is when you could say the idea first came to my mind.
What does your typical day look like and how do you make it productive?
I am happy to say that there is no “typical day,” but each one is full of satisfaction and excitement (if I did not wake up with a migraine that morning.) Part of what I love most about my job is the fact that I’m constantly problem-solving, and the problems of one day are likely going to be completely different from the day before. My typical routine that I have as we navigate the ramifications of the coronavirus pandemic is completely different from what it was in the pre-Covid days, and those days were different from when I gave up management of hotels in 2018. To use an analogy to my time as a doctor, hotels are like the human body: many things can and do go wrong, and oftentimes what is going wrong isn’t immediately visible. I hate to brag about my own abilities, but I believe I have exceptional skills with being able to identify and sniff out such problems. Because I need to be ready and available for anything the day throws at me, I like to have total flexibility with my routine. I do not place any constraints, even going so far as not ever setting up meetings too far in advance.
How do you bring ideas to life?
I have big dreams, but I am not just a dreamer. I take action –– I make things happen. They say “good things come to those who wait” but I believe that good things come to those who make them happen for themselves. When I wanted to purchase my first property, I wasn’t an ideal candidate for a bank loan by any means. Motels are generally considered high-risk within the financial world because of their dual standing as both real estate and business investments, and I didn’t have any prior experience in purchasing property or running a motel. Rather than let that stop me, I used everything at my disposal to ensure I was given the loan. I contacted a former patient who was vice president at a bank who personally vouched for me, and I pointed out to the loan officer the many other factors in my favor such as the low price and location. Finally, I had the full support of my family who were also willing to make sacrifices in order to help me achieve my dream, and I was able to secure the loan that would help me build to the success I have today.
What’s one trend that excites you?
I am generally not a follower of trends –– rather I get very excited by current opportunities. I believe that while it is wonderful that in today’s world we are able to gather data faster and easier than ever before, that is also leading to a lack of critical thinking. It is certainly tempting to hear about a trend and get excited about the idea, but the problem with trends is that they are seen from a zoomed out view. Trends are patterns that are occurring, but that doesn’t mean that every business should ascribe to or follow that pattern. In fact, often following a trend is the exact opposite of what is needed. Of course, it makes sense to see a successful business and think that by emulating their steps you too can achieve greatness, but it is important that you use your own mind, eye and nose, to sniff out the problems that are unique to your business. Simply adopting trends won’t yield the same results as a more nuanced and tailored response.
What is one habit of yours that makes you more productive as an entrepreneur?
Everybody knows that in real estate investing they say “location, location location” is the most important factor. Even if you find a property that ticks off many other boxes, without a good location all of those other factors instantly become irrelevant. Similarly, I believe that the motto for entrepreneurship should be “focus, focus focus.” Without the ability to focus, any other good work you are doing toward your business will inevitably fall flat. As the leader of an organization you’ve built from the ground up you will often find yourself pulled in a million different directions, but in order to truly be successful as an entrepreneur you need to be ruthless with your time management, opportunity management and resource allocation. Earlier in my career I sought to grow the amount of properties as much as possible, but I soon realized that I could run a better business by focusing on finding the properties with the most potential. One of the best things you can learn to do as an entrepreneur is learn to say “no.”
What advice would you give your younger self?
I wish that I had worked earlier to develop stronger networking skills. I would have been able to hire much more capable people earlier and probably saved myself a lot of stress in the process. When I purchased the Coronado motor lodge my family pitched in tremendously to help me run it, but we were all going in blind. I brought in my cousin from Canada on a small salary to staff the front desk in the daytime while I would work the night shift, and he was the first one to even tell me I needed to save all of my receipts in order to keep detailed tax records. While I am forever grateful for them and the other people who worked with me in those early days, I now know from my years of experience in the industry that who you know and have developed a relationship with is often what leads you to your greatest successes.
Tell us something that’s true that almost nobody agrees with you on.
This is an industry-specific response, but I believe we need to pay more in salary to our line-level staff. As I’ve said before, a hotel is like a body: everything has to be working in perfect harmony for it to perform well. For that reason, our guest service agents, room attendants and food and beverage servers are just as important to the function of the hotel as those in higher level positions and we need to make sure they are properly compensated. If a hotel is going through a lot of turnover, guest satisfaction levels tend to stall, and a high turnover rate is usually due to disgruntled associates. As a company you have to set a culture in which the associates feel they are being taken care of, and part of that is ensuring they are earning a fair wage for the integral part they play in guest satisfaction.
As an entrepreneur, what is the one thing you do over and over and recommend everyone else do?
In your quest for financial success do not compromise your values. When you are an entrepreneur, your business is essentially an extension of you, and it should always reflect your beliefs and values as a result. At Pinnacle, I made it our mission to provide quality service through a triangle of caring, in which our guests, associates and assets are all equally important aspects of seeing our business grow and thrive. Every single person in my company knows that I expect professionalism, quality, leadership, teamwork, integrity and appreciation, and in every decision I make for the company I also try to exemplify those values. If you compromise your value system for the sake of turning a larger profit, the triangle of caring will become unbalanced as a result and your business will inevitably suffer.
What is one strategy that has helped you grow your business?
One of my core business strategies is finding the balance between being aggressive but taking “baby steps.” When it comes to investing I take a contrarian approach, meaning I see times of economic distress as opportunities to make compelling business decisions rather than a time to be conservative. While fiscal responsibility and maintaining cash flow are certainly important to maintaining a business, I believe true growth can only happen when you take a risk. There is no room in business for timidity or second-guessing, and I try to remember that when making any decisions. Conversely, that doesn’t mean that I go into every situation with guns blazing. While I may be aggressive in my decision-making, I believe that working incrementally can also often be one of the best ways to achieve long-term goals for a company. If you are trying to make too many changes at once, how can you know which ones are actually making a difference? By taking baby steps, you are able to reflect and see how each decision is affecting your business as a whole.
What is one failure you had as an entrepreneur, and how did you overcome it?
At one point in my career I purchased a large 45-acre parcel of land, only to find that the city and state would not allow me to build on it because of environmental concerns. Rather than accept it as a loss, I litigated against the public agencies and forced them to buy my position. At the time the purchase felt like a colossal failure, and I certainly wasn’t happy about having to direct funds toward litigation. However, part of being an entrepreneur is accepting the fact that everything won’t always go according to plan and you have to be able to adjust your strategy if needed. My best advice for overcoming failure is to expect it, and not let that failure dishearten you to the point that you make more mistakes as a result.
What is one business idea that you’re willing to give away to our readers?
I always try to inform young individuals about the many advantages of investing in real estate, and I would personally recommend hotel ownership. By making smart decisions on your assets, real estate investments can bring in predictable cash flow, tax advantages, and excellent returns. Real estate tends to appreciate and you can force appreciation by renovating or improving the property. In my field, I’ve developed a specialty of identifying and purchasing hotels that require a turnaround. I thrive on finding hotels that are underperforming but hold the potential to be improved upon with hard work and patience. For me, finding a diamond in the rough is what I like doing best, taking the asset and greatly improving my return on investment. Even if you aren’t looking to do that though, I still believe that the advantages of investing in real estate are great and more often than not far outweigh the risks.
What is the best $100 you recently spent? What and why?
I have not been spending much during these days of isolating ourselves at home, but I recently sent $100 by Zelle as a surprise gift to one of my associates for being so effective working from home during the coronavirus pandemic. It is important to remember that every team member has specific needs and desires, and the best way to encourage that is by getting to know them and identifying the best way to motivate them. I knew this particular associate would be motivated by money, but others are more driven by change or excitement, and you must be able to recognize that in order to help each individual grow with the company. I take a lot of pride in being more than just an owner, but also a teacher to my associates, helping them to understand what we’re trying to accomplish and why. For me, investing money and time in them will always be well-spent.
What is one piece of software or a web service that helps you be productive?
To be frank, I am not the type of person to rely on software or services for productivity, but I can say that I would not be able to get nearly as much done were it not for my staff. I could not do without my executive assistant and my financial analyst. Being able to delegate is absolutely one of the most important skills an entrepreneur can have, and I find that much more valuable than any software or service.
What is the one book that you recommend our community should read and why?
“Shoe Dog” by Phil Knight. It is a very good account of how he started Nike and built it into the very large public company it has become. In particular, I noted the fact that when it came to finding talent he simply looked for the sharpest minds he could find. The athletic shoe industry was not nearly the behemoth it is today, and hiring people because of their experience in that specific sector would have been extremely limiting. Like me, he believed that finding great people was the key to building a successful company. That is just one of the many lessons that can be taken from Nike’s ultimate success story, but the book covers the entire fifty-year history of the company and reveals just how difficult but rewarding entrepreneurship can be.
- They say “good things come to those who wait” but I believe that good things come to those who make them happen for themselves.
- I believe that while it is wonderful that in today’s world we are able to gather data faster and easier than ever before, that is also leading to a lack of critical thinking.
- Part of being an entrepreneur is accepting the fact that everything won’t always go according to plan and you have to be able to adjust your strategy if needed
Steve (Stefan) Junge hails from Germany and helps with the day-to-day publishing of interviews on IdeaMensch. While he and Mario don’t share a favorite soccer club, their enthusiasm to help entrepreneurs is a shared passion.