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Rags to Riches

Once upon a time, a long, long time ago, a young Unitarian minister sat down to write a book that captured some of the drama of the lives of poor young boys living in the ghettos of New York City, where he was a social worker. The budding author developed a successful theme for his books, ultimately writing 134 of them. Most were best sellers. His name — Horatio Alger — became synonymous with the idea that no matter how poor people are, no matter how socially powerless, if they work hard, do their best and always try to do the right thing, they wil succeed. To tell a Horatio Alger story is to tell an American success story.

If readers are tempted to dismiss this notion today, all they have to do is learn the life story of William A. Krause, founder of Kum & Go Convenience Stores and CEO of Krause Gentle Corp., based in West Des Moines, Iowa, with 425 stores.

Krause's life story is a tale that Alger himself could have written. Krause learned many of the same lessons the boys in the novels learned, and those lessons form the foundation of his leadership style today.

"I've been on my own since I was 15 years old. I left home when I was 15, and I went to three different high schools in Iowa, so I learned at an early age what life's about," Krause explained. "I've been fortunate, because along the way, as you would imagine, I've had several people who did some monumental things for me — including a very gracious father-in-law. I tried to emulate some of the values and virtues that I observed in people I had respect for."

Krause left home when his father, a farmer, went broke. The young Krause hired himself out as a farmhand for $10 a week, living with a Quaker family. The Quakers did not literally work him to death, he said, but "they gave it their best."

Krause's father had taught him the value of hard work, and when he set out for the Quaker farm, he already had a solid work ethic. Still, he said, "I'm sure the Quakers are responsible for many of the values I have regarding work." Today he has a reputation as a workaholic, he added: "Work is my vocation and avocation both."

But his guidance in worldly matters, and his role models for achievement and accomplishment, came from other sources, he said.

He said at the top of his list of important influences is his 91-year-old father-in-law, who still serves as chairman of the board of Krause Gentle. "He and I have been in business together for 45 years. He is a wonderful man who provided that all-important incentive called 'money,' and hopefully I was the counterbalance with a high degree of ambition.

"The other influential figure is Forest Evashevski, my football coach at the University of Iowa," Krause continued. He had a chance to observe Evashevski for four years as a student in the class of 1957. He said the coach "was a great deal like Vince Lombardi. When he walked into a room, there was immediate silence. When he spoke, everyone bent his ear to hear what he was saying. He was a father figure, a mentor. He's 90 years old, in perfect health. He recently wrote me a letter that I am proud to have received."

He added, "I knew that work works wonders. I had no trouble with work. My personal mission was to outwork anybody who got in front of me, because that was the only thing I had going for me. I had no legacy; I had no one that was going to provide anything for me, so I knew that if I worked long and hard and honest, that good things would happen."

Laying the Groundwork

The roots of Krause Gentle Corp. can be found in the life of young Bill Krause, student.

"When I was in school, I never had less than four or five jobs," Krause said. "One of them was when I left the farm and moved to Eldora High School in Eldora, Iowa, where I graduated. I worked in a Sinclair gas station, where I went to work at 6:00 in the morning and worked until 8:00, and then I'd go to school. Three nights a week, I'd work from 6 p.m. until 10 p.m., and I worked every Saturday, every Saturday night and every third Sunday. So I didn't have a lot of time to get into any problems. As luck would have it, when I got ready to start interviewing, one of the companies was Continental Oil Co.

"I thought, 'You know, I know how to clean restrooms. I know how to check oil, wash cars and wash windshields, and so maybe this is my career.' So I went to work for the company now called Conoco."

But before too long, Krause went into the Army as a second lieutenant, a position that gave him his first real introduction to leadership. "I did learn that being a company commander, if you wanted to take advantage of leadership skills, they were available."

When Krause came home from the army, he fell in love with Nancy Gentle, the only child of T. S. Gentle. Krause was moving up quickly with Conoco, and the company wanted to transfer him to Jackson Hole, Wyo. "But that was a long, long way from Iowa Falls, Iowa," he said.

In 1959, Krause's father-in-law offered to go into business with him instead. Krause told him, "Mr. Gentle, today I could not buy a $100 United Stated savings bond."

The two were able to make a deal, but it was one that was defined by Krause's deep sense of discipline and self-reliance. One of the terms was that Gentle was never to co-sign a note for Krause. Another was that the older man would exclude Krause from his will. Once those terms were settled, Krause and Nan Gentle got married.

T. S. Gentle provided Krause with the financial partnership he needed, but he was not a business partner. Gentle had a drugstore and other investments nearby, and bought Hampton Oil Co. in Hampton, Iowa, as a way of helping launch young Bill Krause's career. But perhaps more importantly to Gentle, he knew it would help keep his beloved daughter closer to home than Jackson Hole.

Krause rules today over an empire that includes not only Kum & Go convenience stores but also a chain of banks and other interests, but his beginnings in the business were very modest. The gas station lot was not even paved; it had gravel. The business also included a bulk plant and two antiquated tank wagons. By this time, the young farmhand had graduated from college, worked for Conoco and seen a bit of the world, and he easily could have turned up his nose at the little filling station and the 1946 Dodge truck. But this was a "pit stop," he said, that helped him get to where he is today.

Leading by Example

Krause knew deep down that his destiny was not limited to a humble gasoline operation. "I truly tried to lead by example," he said. "The people who came to work for me were, for the most part, great young people, but not highly educated. A year or two of junior college, perhaps. For a long time I had one college graduate, and he's been working for me for 30 years.

"People truly like to work to work with me because I am gracious with compliments but demand a high level of discipline and respect. We don't allow gum-chewing; we don't allow smoking. There are no casual days."

Krause said pride and confidence are the keys to such a work environment. Asking employees to put a suit and tie on engenders a feeling of honor and privilege in them, he said.

"God gave me a personality so that people like to work for me. Forty-five years later and with 4,000 employees, I'd better have that kind of personality." Krause said he has quite a few employees who have hit the 40-year mark with his company.

In telling his story, Krause returns again and again to his youth, and to those simple, core values he learned early. He said, "When I was growing up, I got a jillion compliments from older people: 'Billy Krause, you are the hardest worker.'"

Those people, whether they knew it or not, were providing the motivation and inspiration for Krause, he said. "People knew that we didn't belong to any country club, and so I had a different kind of respect. I had not accomplished anything except that I worked; I called everybody mister, or sir, or ma'am.

"I always went that extra foot-and-a-half. I got that from my father." n

Kum & Go: A Brief History

1959 W.A. Krause and T.S. Gentle founded Hampton Oil Co., Hampton, Iowa.

1963 Converted gas stations into convenience stores with fuel and merchandise.

1974 Krause and Gentle wanted a name that would symbolically represent the two families' partnership, as well as promote the speed of service available to customers. The family used the first letters of each last name — "K" and "G" — and the name Kum & Go was born.

1980 Kum & Go expanded its customer service by constructing quick-service restaurants in its convenience stores.

1998 Kum & Go doubled its growth with the acquisition of more than 100 stores. Computers were added to the stores to further efficiencies and reporting methods.

1999 Acquired 43 convenience stores in Iowa.

2003 Entered into a partnership with 34 CENEX stores. Added Wisconsin as the 13th state with Kum & Go convenience stores.

2004 Acquired 76 convenience stores in Oklahoma and Missouri from Tulsa, Okla.-based Git-n-Go.
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