Transcription

• Speaker #0

  The entrepreneur brings so much creativity to business, but they die inside when they stay stuck after they shouldn't be in that place anymore. My role is I'm a temporary, like, special forces. I'm in, build the system, get out, move on to the next thing.

• Speaker #1

  How do you decide what's better, whether you job something out to like an agency or a freelancer, or you hire it internally?

• Speaker #0

  There's two things in business. There's things that create value, and then everything else is waste. If you can create a business that minimizes waste and... you can create predictability to that. Then your business is going to run better. It's going to be more valuable if you ever want to exit.

• Speaker #2

  You got to give time. You can't expect 100% when you just hired somebody.

• Speaker #0

  And my thinking has always been when you can buy your time back at a discount, you should hire someone. My hourly rate for my consulting clients and stuff is like $3,000. If I'm doing anything that is lower value than that, I have to really take a serious look in the mirror and be like, why am I doing this?

• Speaker #3

  You're what? I'm marketing misfits.

• Speaker #1

  Norm Carrar, the lead advocate.

• Speaker #0

  That's what I'm doing. Hey, Norm,

• Speaker #1

  you're going to be coming back down to Austin to visit me again pretty soon. I just want to remember. Do you remember this guy?

• Speaker #2

  Do you remember that? Oh, yeah,

• Speaker #1

  I know what that is.

• Speaker #2

  This guy? I remember him very well.

• Speaker #1

  You remember when I came on and said, Norm, I have a present for you. And you're like thinking this is like a box of chocolates or some candy or something.

• Speaker #2

  Which you do every time I come down.

• Speaker #1

  Which I do every time. And you're like, oh, thank you so much. And then you open it and out comes a spider. And you hate, you hate, hate spiders. Hate. And I'm still, I got to be on guard this time because who knows, you know, like you said, there might be a Colombian in my bed or who knows what I'm going to find. what I'm going to find, but I got something else, and you and I can get somebody good with this one, I think. So I saw this on the TalkTicker shop. So it's this little thing that, listen, listen here. So it's got a little thing. What's that sound like?

• Speaker #2

  Sounds like you're winding something.

• Speaker #1

  A watch. A gun?

• Speaker #2

  Oh, okay, okay. I can't hear it too well.

• Speaker #1

  So the way you use this little prank tool, and this ties into our guest today because he loves pranks, is you can walk. Someone's walking in the hallway and they're on, you know, you got an L-shaped hallway. So someone's coming down the hallway and you're coming out this way and you're backing up with your hands up. And I cranked it. I clicked this and then I shoot it and you fall to the ground. And they think you watch people scramble all for into the distance. It's a freaking awesome little little prank thing. But our guest today is someone who loves pranks. So that's why I wanted to show you that we have a new cool toy to play with.

• Speaker #2

  I was going to say, if it has a gun sound, that's not very safe. Somebody will end up shooting you in the head. I think going out there with a whoopee cushion is a lot better. I just got to tell you. Fart noises aren't going to get you killed.

• Speaker #1

  I got another one today. I don't have it with me right now, but it looks like a bomb. And here's the thing. Oh. Don't, don't, don't, it looks like it's like a, it looks like a bunch of dynamite tied together. And it's got a clock, you put a battery in it, and it's got a little countdown clock. And then you take some water and you drop it in, it starts to smoke. And you just drop it like it, at the door, someone opens it up. And like, it's counting down like a minute, 59 seconds, 58 seconds, and this smoke is coming out. So anyway, enough, enough, enough about the pranks. Who's our guest today? Yeah, mate. You're familiar with what he does?

• Speaker #2

  No, actually I'm not. We've got James Trail on and he's awesome. Both of us know him. And you know him from Driven. I know him from just some other casual conversations. But we could bring him on right now.

• Speaker #1

  Let's do it.

• Speaker #2

  All the way from Nassau.

• Speaker #1

  All the way from Nassau, that's right. Welcome. How are you doing, man?

• Speaker #0

  i'm good i uh i was listening in the background hearing about your pranks uh which definitely got me chuckling reminded me uh when i was a kid like i insisted that my mom take me to like these little novelty shops to get you know whoopee cushions and like all this sort of stuff and one time i got these blood capsules and i was playing with a friend of mine and you know we'd been hanging out for a little while and i just kind of got bored and i put one of the blood capsules in in my mouth and We were playing catch and he threw the ball and I kind of let it hit me in the face. And I just like spit blood everywhere. He freaked out. He freaked out. He didn't know what to do with himself and started screaming and ran in to get my mom. And my mom came out and she saw me rolling on the ground laughing with like all the pain. Immediately knew what I had done because she bought the blood capsules for me. And anyway, so those prank toys. Yeah, I don't know if I'm proud to say it, guys, but yes, I'm no stranger to.

• Speaker #1

  You do prank phone calls or something, right? Or you do?

• Speaker #0

  Well, I can't confirm or deny, you know, what is happening or not. But I have been known to do that in the past. Yeah, I kind of graduated from the blood capsules and whoopee cushions just to do a prank.

• Speaker #2

  I got to just tell you a quick story because you say blood capsules. This goes back to my college days with my roommate. So we. Yeah,

• Speaker #0

  yeah.

• Speaker #2

  17, 20s. Before the U.S. was actually.

• Speaker #0

  The roommate with Benjamin Franklin. That's right.

• Speaker #2

  That's why he was bald, you know. So we got into this fake argument. But our next door neighbors were a couple of other guys that we went to school with. And we were screaming and we sounded like we're throwing each other against the walls. I was in film. So film, cinematography. And I was taking the blood capsules as well. I put a couple in my mouth. Reagan, my roommate, was, you know, hitting me and throwing me around, just faking. But there was blood everywhere. And then I'm on the ground and there's just like a puddle of blood right beside me. He runs over to the neighbors. He tells them to come back. I'm thinking that they're just going to freak out, right? The one guy stands over me and says, what do we do with the body? Like, what do I do with the body? It's not like, hey, let's get an ambulance.

• Speaker #1

  There's videos of cranks like that on TikTok right now where people will wrap up their, you know, the wife will wrap up her husband like mummify kind of. put him on the ground and the uber guy comes and knocks on the door to deliver or not the uber guy the uh uber eats guy comes and knocks on the door to deliver the stuff and she opens up and she's like one hand holding his legs he's on the ground all wrapped up like he's dead she's like can you give me a hand i just need to carry him to the trunk and you can see because people like freak out it's it's pretty good i love that that kind of prank stuff that's speaking of blood uh blood i mean there's a lot of businesses that are bleeding and that's kind of what you Your specialty is, James, right? I mean, you come in and fix the bleeding and help a lot of businesses turn around and systemize or something along those lines. And you've even gamified that. I'm sure we'll talk about that as well. So what is, yeah, 57 hats. Let's go. And I know that feeling. Sometimes I think Norm and I feel like we're wearing 57 hats. We're starting a new company together right now. And it feels like, I'm like, man, we're both doing like 26 things. We need like people. we're not ready yet to hire those people. So we're having to get the systems and everything in place that we can actually then hire the people to basically duplicate ourselves. So tell us a little bit about your background and how you came to do what you're doing now.

• Speaker #0

  Yeah, well, you know, I'm a recovering engineer. I guess I'll start there. I studied aerospace engineering in college and then got into software actually after school. But I think, you know, Back to the whole bleeding. That was a great tie-in, by the way, Kevin. I didn't know how you were going to tie it all together, but you did a remarkable job with that. I was like, wow, that's pretty good. I'm going to have to remember that, maybe do some content on that. But I think from my perspective, there's two things in business. There's things that create value, and then everything else is waste. And the bleeding that you're talking about is the waste, right? We hire people, we make money, and then we're like, well, where's it all going? What's happening to this? Because you can't cash revenue in at the bank, right? You have to... It's profits that you keep and you can reinvest them or distribute them or whatever. And so for me, one of the things that I kind of obsess over is how do we make sure that everything we're doing in the business is strategic and it's adding value so that we minimize the waste and we can keep as much money as... as possible. And, you know, 57 hats, which we can talk about a little bit, I think is our, our approach at, you know, kind of making the conversation that conversation about, you know, what hats am I wearing? What hats shouldn't I be wearing? Like, who should be doing what? It usually is a very boring, heavy conversation. And it's not structured in an easy way for people to even talk or think about on their own. And so we took a framework that I've used to grow multiple of my own businesses, but also after tens of thousands of hours of consulting businesses to say, all right, here's how to think about this and how to think about, well, should you automate something? Should you outsource it? Do you need to hire somebody? Like all of those things are questions that every founder and business owner is faced with. And, you know, my belief is that if you can create a business that minimizes waste and. you can create predictability to that, then your business is going to run better. It's going to be more valuable if you ever want to exit. And if you don't want to exit, it's going to be ways for you to run so that you guys have multiple things going and so do I. You can start the next business and be an entrepreneur instead of be a not so great manager because I don't think most founders and owners are great managers to begin with. So the ambition of this is to help people get out of the things that they shouldn't be doing and make sure the things that need to be done or being done by the right people.

• Speaker #2

  Yeah, it's so important. What you said there about entrepreneurs not being great managers, how many times have you seen like a great business opportunity just run horribly? And I thought I'd ask this question a little bit later on, but the top people that you have to bring on. So you're at that point where you're just, let me back this up, James. So I am a graduate of the E-Myth Academy. So I went, I did the whole course and it really got me going and thinking a whole different way. But there's something called this entrepreneurial sales roller coaster, where the entrepreneur is at their max, they can't handle it anymore. And they have to hire somebody, they hire somebody, they don't train, and then they fire them because they can't do it. the same way they can. And it's just an ongoing cycle. What's your first, or what's the first group of people that you should be looking at or even considering when you start a new company?

• Speaker #0

  Yeah, it's a great question. And I think that my approach to this is sort of reverse engineering what success looks like. And so if you think about it this way, Instead of thinking about who should I hire, you should think about, well, where do you, like Norm, Kevin, whoever's listening, where do you add the most value to the business? And that could change over time. But if we say that you should be focusing most of your time on things that you're good at, things that you enjoy, and things that move the business forward, then that gives us a target of what you should be doing. So if let's just say you're great at sales development or something, then I would say do that for a little while while you hire people to do the things that are not good. And so thinking inversely, instead of saying, all right, well, I'm going to get rid of all these different things. It's more about, well, what should I be doing first? And how do I start forcing out all the other things that I shouldn't be doing? And that's going to be different for everybody because not everybody. is good at the same things. Not everybody enjoys the same things. Not everybody moves the business forward in the same way. Because you could be a technical founder of a SaaS company, but you suck at sales. Okay. Well, then if you're great, if you're this tech wizard, and you're great at developing solutions that people love, maybe you should stay in that role for a while longer and compliment yourself with somebody who's better at sales. But contrast that with somebody who's not good at developing anything, but they're really good at sales. The advice for those two people is totally different in terms of like who they should hire, but the approach to figuring out how to extricate themselves is the same approach. And it's really by designing what should we be doing? And then what are we doing that's not that? And starting to offload those things in a strategic way.

• Speaker #1

  Hey, Norm, you'll love this, man. I talked to a seller the other day doing 50K a month. But when I asked them what their actual profit was, they just kind of stared at me.

• Speaker #2

  Are you serious? That's kind of like driving blindfolded.

• Speaker #1

  Exactly, man. I told them, you got to check out Sellerboard, this cool profit tool that's built just for Amazon sellers. It tracks everything like fees, PPC, refunds, promos, even changing cogs using FIFO.

• Speaker #2

  Aha. But does it do FBM shipping costs too?

• Speaker #1

  Sure does. That way you can keep your quarter for... chaos totally under control and know your numbers because not only does it do that, but it makes your PPC bids, it forecasts inventory, it sends review requests, and even helps you get reimbursements from Amazon.

• Speaker #2

  Now that's like having a CFO in your back pocket.

• Speaker #1

  You know what? It's just $15 a month. But you got to go to sellerboard.com forward slash misfits, sellerboard.com forward slash misfits. And if you do that, they'll even throw in a free two-month trial.

• Speaker #2

  So you want me to say go to sellerboard.com misfits and get your number straight before your accountant loses it?

• Speaker #1

  Exactly.

• Speaker #2

  All right.

• Speaker #1

  So what if you're just starting? and you don't have a lot of budget. Maybe it's, let's say it's just a couple partners, a husband and wife or two buddies or something that is starting something up, and they don't have a lot of budget. And they kind of know, maybe they're starting, I don't know, say an agency or something, and they're starting an agency to help Shopify sellers or Amazon sellers or something like that. And they know how to do the stuff. They also have the skills to actually do the tasks, but that's not scalable. So they got to set up the systems and the processes and like, okay, get in here and work with the first client or two or something like that. And then set up the system so that someone else can scale that to, you know, a hundred clients or whatever. What, but it's not really where they should be spending their time, but they got to spend their time there to get those systems up and running. What's your advice on something like that? And when is it that you make that first hire?

• Speaker #0

  Yeah, it's a great question. And it's a, you know, it's a reality for a lot of people and especially when you're getting something going, is that at first, for a little while, you might have to do something that's not scalable in order to create the system that is scalable. Right. And I think that's OK. Right. You know, a lot of a lot of founders and owners get trapped up in this like, oh, I should be doing this or I shouldn't be doing this. Like everybody should be working on what the business needs most at the time. And the problem the problem is that people. somehow just start camping out in these areas that they shouldn't stay in for a long period of time. So the example that you're giving, Kevin, where you might have to set up some CRM system or some landing pages or whatever, that sort of stuff. It has to happen if you want to make money. But the problem is, you start making progress and you hoard that role that was never meant for you for the long term. And we have to be okay building systems and moving past it. And one of the ways that I look at systems is that it's three parts to a system. It's people, processes, and technology. Because I still will go into, like with 57 Hats, we launched that a little less than six months ago. And that's business number four right now for me that I'm an owner in. And so in that business. I was in very much the same position that you're talking about, where I need to figure out, well, how do we ascend people? How do we monetize after they buy the box? And so I've been building a system for selling and upselling and that sort of thing. And I'm kind of moving myself out of that right now. But I've been involved in that for a few months with the knowledge that I'm not giving myself a new job. I'm giving myself a project. And that project is to create a system. And then I start pulling people in to operate that system that I built. And so short answer is sometimes you have to do what needs to be done. But what needs to be done is not to do the job and to own that hat. The job that you need to do is to build the system. Who's the people that are going to run this system? What processes are they going to follow? What tools are going to help them do that? And how am I going to manage? observe that the system is on track with metrics and KPIs and stuff. And if that gets built properly, then you move on to the next thing that requires your attention as the entrepreneur, right? The entrepreneur brings so much creativity to business, but they die inside when they stay stuck after they shouldn't be in that place anymore. And I think that more often than not, people torpedo their businesses. Because they stay in roles that they created for themselves instead of thinking about my role as I'm a temporary like special forces. I'm in build the system, get out, move on to the next thing. Instead, they're like, oh, I've been I've done six tours of duty in this one part of my business. And it's like, dude, you should have been extracted six six years ago. And and so I think it's I think it's a different way of looking at it. It's not, should I do this? It's how should I think about doing this so that this doesn't become a permanent condition?

• Speaker #2

  So you're, if I'm understanding it correctly, and I agree 100%, like work on your strengths. You have to work on multiple hats at the beginning, but work on your strengths at the end. And, you know, for me, I hate accounting. I went to university. I went and took a course or two, and that was it. I just wanted to know enough about it and then get the hell out. But if you're building, I guess, a long, long way around asking this question, is it building out your org chart? understanding, let's say you have four people in the organization, who's taking what responsibility and wearing the multiple tasks and then trying to hire out as you go and then sticking with your strength.

• Speaker #0

  Yeah, I think as much as possible. The other thing that trips people up too, so you mentioned accounting, so I'll pick on that for a minute. Accounting is not a creative activity and it should be, right? If you have a creative...

• Speaker #1

  If you're an accountant, you might have some problems with the IRS.

• Speaker #0

  And so take something like that, which doesn't require high level creativity. There's guidelines that have been in place since Norm was in college with Benjamin Franklin. Like it's very well set. And so for something like that, you can pay a reasonable amount of money to have somebody take that off of your plate. No kidding. Like I've talked with... business owners who are doing multiple millions of dollars who are still spending hours a week in QuickBooks. I'm like, what are you doing? The opportunity cost for you is extraordinary. Because if I'm able to go out and I'm able to generate X dollars in sales, but I could spend 5% of that on somebody to do something for me, my opportunity cost is too big to keep doing that. And I think that's another way to. kind of balance out when should I hire somebody. And my thinking has always been, when you can buy your time back at a discount, you should hire someone. So if I'm... My hourly rate for my consulting clients and stuff is like $3,000. And if I'm doing anything that is lower value than that, I have to really take a serious look in the mirror and be like, why am I doing this? Because it's costing me that amount of money. And I might be willing to make a trade for a short period of time because I think the long-term benefit might be there. However, if I'm like operating in that role, it makes absolutely no sense. And I'm poorly managing resources at that point.

• Speaker #2

  So one of the systems that when we're looking at it at the very beginning, you have your org chart, then you have your task board. Very similar to what you're saying. We build out a $10, $100, $1,000, and $10,000 tasks. you that's just a number. Okay. But anybody that is building out the $10 task, you shouldn't be handling. You should be just giving that to whoever, especially repeatable $10 tasks. You should be focusing as the business owner on those, well, $1,000 tasks like for Amazon sellers. It might be understanding and implementing your PPC at the beginning, but then handing that over to a company or agency later on. And you focusing on networking and building and developing, doing the biz dev for your company at the $10,000 board. And you're just linking that up to your org chart. So it's just a system org chart first, task board second, and then people who you assign to these tasks. That's just a system that we've dealt with for a few years.

• Speaker #0

  Yeah, I think that's great. One. One thing I would add to that is a different way of looking at your org chart or your business as a whole is something that is embedded in the 57 Hats framework. But it's this idea that every business, whether it's a startup, a scale up, a billion dollar company or whatever, has five key pillars to the business. And it's marketing, sales, delivery, operations and finance. And every business has those and every business needs those. And then taking those across kind of the top and then looking at where do each one of those rank in terms of red, yellow, or green, right? Red, where we have no systems in place. We're not getting any leverage. Yellow, we have some leverage coming together. And green, where we have fully functional systems. And if you map those five pillars with red, yellow, green, it becomes much easier for you to focus where you should be putting that time and attention. right because the very you know every business is different at different stages of growth and and what they actually require in order to continue to grow and so when a business has marketing at red and sales at yellow but their delivery or fulfillment is green The things that that business should be working on are different than a business that has marketing and sales on green, but delivery and operations are on red. Because if I have great marketing and sales, but my delivery, my fulfillment, and my operations are on red, how much more money do I want to be putting into ads before I solve those problems? It's like not much because the wheels are going to fall off and my reputation is going to be damaged. I'm going to have poor service quality for my customers. And so I think sometimes, you know, like I'm a big fan of, you know, education and events. And obviously, that's how I met you guys and all this other stuff. But I think that sometimes, especially people who are starting up, but even people that have been around for a while, see what one person is doing. And they say, oh, that works for that person. I should do that, too. And it's like, well, it works for that person because. the stage of growth they're in, the strengths that they have, the type of team that they have, the type of offer they have, all these different things. And so a lot of people just make mistakes by lifting and shifting what's working for somebody else, but they're misapplying their resources to something because their situation, their circumstances are different. And, you know, you hear a lot of people be like, oh, you know, you're not a special snowflake or whatever, you should just do this and it'll work. And it's like, well, And maybe we don't want whining like special snowflakes, but you guys are different people than everybody else. And the way that you go about running your business might need to be different. And what your business needs at that point in time might be different. So I love what you said, Norm, about the org chart and the tasks. But I would also say that you don't have to tackle everything at once. Not all tasks... And not all initiatives inside a business are created equal, right? You should be focusing on the things that are going to move you the furthest with the least amount of brain damage first, and then continue to move forward from there, reevaluating at each stage, what does the business need from me now in order to minimize waste? Going back to our blood capsule analogy at the beginning.

• Speaker #2

  So you're doing monthly and quarterly audits, right?

• Speaker #0

  I knew it. I think quarterly is the right, a really good cadence. And I think a lot of people can get a tremendous amount done in a 90-day sprint, as long as that 90-day sprint is laser focused on the thing that's actually going to make the biggest difference in the business.

• Speaker #1

  How do you decide what's better, whether you job something out to like an agency or a freelancer, or you hire it internally? When you're doing that analysis, like you said earlier, you know, this is a, I'm $3,000 and this is a... $500 an hour thing. I'm going to job that out. How do you make that decision of which way to go?

• Speaker #0

  Yeah. I think one of the ways that I think about it is how much internal execution intelligence do we have around this topic, right? If I don't know anything about something, I think the odds of me being able to be a really effective manager over somebody in that area is probably going to be much lower. So unless so it's like If I don't have a lot of execution intelligence on that particular area, then I either need to bring somebody in-house who is high horsepower, probably going to cost a bit more in terms of labor costs, or I'm going to outsource that to an agency or an external partner that has a great reputation for it. If I have execution intelligence, that means that going back to the systems thing, people, processes, and tools. If the process that I can develop to plug someone into is good, then it will be easier for me to bring somebody in at a lower cost basis. And so it really depends on how clear I am on what needs to be done and how it needs to be done. It depends on the level of person that I need to bring in to either build that system or not build that system. And, you know, so for me, it's a question of capability and where does that capability reside.

• Speaker #2

  Back in the day, I had a company where I had a person that I hired right off the bat, day one. She worked with me on just a project manager. And she was working with setting up catalog systems for clients that we had. And she did it all manually on a spreadsheet. And that was fine until we started getting more and more and more clients. And what I ended up doing, and it was more money. it was a five or $7 an hour more. And I brought in this new person. She didn't know what I was paying, but what this person brought in was automation. And she was able to do what this person would be doing in a week. In a few hours.

• Speaker #0

  And at the time I was really questioning, you know, should I go and spend all this money on this new person, like seven bucks an hour, all this money, but it worked out. It paid. But the problem I had is that that person that saw this person just, just killing it on these catalog programs, she knew her job was up. There was no work for her. So. She didn't have a job to hire up to. And that was a problem. But I hired smarter when the time was right. But we have to realize that sometimes those people that you hire at the beginning, that level of people, the people, the employees, the contractors, sometimes you can't train them because you have to have that other specialized person come up and take their job, unfortunately. I don't know if you've seen that. I don't know. what your thoughts are, but it's terrible when it happens.

• Speaker #1

  Well, yeah, I've certainly seen it. I've lived through it numerous times. I've seen it over and over. I'm going to challenge the assessment that it's terrible when it happens. I'm a big believer in trying to see reality for what it is instead of being overly optimistic or, you know, shades of pessimism. And I think that... So we just onboarded four new people on our team in the last couple of weeks. And I had a joint onboarding meeting for everybody. And one of the things I told him, which I've gotten inspiration from, Reed Hastings from Netflix on this, is that a lot of businesses do a disservice to their team members by telling everyone, hey, here we're a family. And what I told my new team members, I was like, look, What I'm about to say to you is potentially going to sound harsh or it's going to sound like, you know, I don't care. But it's actually the complete opposite. I said, you know, we're not a family here. I'm not trying to become a substitute for your family. I'm not trying to be part of your family. And as much as I might like you, I don't want you to be part of my family. We are a team. And a team is different than a family. A team is a construct of people that's on a mission to accomplish something. A family is a social construct for connection and relationship and belonging and all of those things. And we create dysfunction on teams when we call people family, right? Like you're not going to fire your mom or whatever just, you know, for being your mom. It's like she's your mom and that's how it is. And, you know, even if you go home for Thanksgiving or somebody comes over and it's like one of your crazy fringe relatives, like you're like, yeah, they're part of the family. Like, you know, that's how it is. but like Team is different than that. And I'm a big sports guy, baseball in particular. And when you look at a baseball team or any other sports team, managers change team members and team members change teams. And the reality of team is that it is not static and it's fluid. And our job as business owners is to bring in the best possible team member that we can afford for that job that needs to be done at any given point in time. And I think a lot of times it's very easy to become idealistic and romantic about, oh, man, this person started at the very beginning with me. And, you know, now they've come up and it's like, look, some people will continue to either level up or maybe they just stay in that same role as the business levels up. But it's also totally OK and normal to realize that as you're growing your business, you need to make management decisions. And sometimes that includes. changing team members. And I think it's only terrible when we have a lens that says it shouldn't be this way, when in fact, that's how it actually is. And that's how it operates and works best. And so if we set that expectation up front, that this is how it is, it becomes much easier to manage that later down the line when we need to make changes.

• Speaker #0

  So even during your onboarding process, you're managing those expectations right at the start. I love it.

• Speaker #1

  Right. Day one, like literally day one. And by the end of the call, I was like, look, and if this doesn't work for you, like no harm, like you guys, you can leave now. But I want you to know going into this, like what to expect. And it's not and it's it's not done in a derisive sort of like I'm a you know, I can't wait to fire you. I'm waiting for you to trip up sort of way. It's it's done in in a manner of look, I'm only building this team because I want to win. and you're on this team and if you're on this team i want to win with you but our overarching objective as a team is to win however that gets defined And it's interesting because when you set those expectations, the right people will feel relief and they'll be grateful. Like every single one of those four people that were on that onboarding meeting that they were like, oh, so glad you said that. Like, I can't wait to be here and like do my absolute best work, but not under false pretenses that were some sort of like weird, janky, dysfunctional family.

• Speaker #0

  Are you looking to quickly boost new Amazon product launches or scale up existing listings to reach first page positioning? The influencer platform Stack Influence can help.

• Speaker #2

  That's right. Stack Influence pushes high volume external traffic sales straight to Amazon listings using micro influencers that you only have to pay with your products.

• Speaker #0

  They've helped up-and-coming brands like Magic Spoon compete with Cheerios for top category positioning, while... also helping Fortune 500 brands like Unilever launch their new products.

• Speaker #2

  Right now is one of the best times to get started with Stack Influence. You can sign up at stackinfluence.com or click the link in this video down in the description or notes below and mention Misfits, that's M-I-S-F-I-T-S, to get 10%

• Speaker #0

  off your first campaign. Stackinfluence.com.

• Speaker #2

  Can you give us an example of someone that you've come in that was just a mess? Maybe give us a few things of how they're a mess and how you implemented and advised them and what the end result was at the end. Do you have an example of something that you can be specific? You don't have to say the name of the company if you don't want to, but be specific on who the listeners can go, oh, that's happening to me. That's happening to me. Oh, this is how he fixed. Oh, something along those lines.

• Speaker #1

  Yeah, absolutely. I'll sort of probably. merge a few different examples together, like illustrate the point and protect the innocent, so to speak. Some people listening might even be them. But I think one, so there's like a series of things that become problems. One of the problems is that people are working on the wrong things. That's a really big problem. And so the way that I go about correcting that is doing that. you know, that very high level red, yellow, green assessment that I was talking about there, like everybody that we start out working with, we go through that process in some shape or form or another, right? Because it's important to me as an advisor. And even if I'm coming into a business where I'm, you know, a partner, I'm an investor or something like that, I need to know where are we relative to where we want to go. And I can't know, I can't have a good, I can't create a roadmap to where we want to go if I don't know where we're starting. Right. And so I think one of the places where, you know, you could call it a mess, but I think it's probably just lack of clarity. I think most most problems start because of a lack of clarity. And so if we reverse engineer that, we say, well, what do we need to do first? We need to create clarity. Right. And so the clarity is, well, what area of the business requires most of our attention and where do we need to focus? Right. And so I think that's that's generally step number one. And that happens in a variety of different levels depending on how we work with somebody. It could be we have a quick conversation just to kind of get grounded on where we should focus. Or it could be we come in and we interview 10 people on their team and get a sample of the different levels of the business. Or we interview the executive team and get like a 360-degree picture so that we can create that assessment. I think that's generally step number one. And then step number two. It has like it wears different. It wears like different costumes, but it's still the same thing. And the same thing is people. People don't have clarity on what their roles are supposed to be or how what good looks like. And how do we know that they're actually doing a good job or not? Right. And so we have to clean up that people piece. And, you know, we have this thing that we call a player scorecard. And the player scorecard has like, OK, these are my big five objectives. These are my critical success factors. These are my key metrics. And this is how I report to everybody. And a lot of times people come into a company and, you know, you might have had a job description that you hired them from, but that doesn't really translate to how do we know they're doing a good job on a regular basis. And so I think attacking the people problem is really important. And what a lot of people don't realize when they're running a business and they're managing people is that Managing people really isn't so much about managing people as it is managing a process that people plug into. And so if the process is not there. The only alternative is to micromanage people, which nobody likes. Management doesn't like it and the employees don't like it. And so making sure that the right performance management system is in place so we get the most out of those people, I'd say almost across the board is missing from most companies. Like if I'd say like there's one thing that most companies could do immediately to reduce the bleeding and reduce the waste, it's to have a performance management. system on how do we know what good looks like for each of these people? Because all of those people should be contributing towards some business goal. But if you look inside most companies, especially the ones that are struggling, people are doing things. And they might even be doing things with enthusiasm and excitement, and all of that, but they're not doing things that matter to the goals of the business. And so all of that money is just like, you're like lighting it on fire. Right. And so I think after that. sort of initial high level assessment of what area of the business do we need to focus on, we very quickly get to, well, who's focusing on that? Do they know what a good job looks like? And how do we make sure that we're managing their performance effectively? And it's a complex question, Kevin. However, I would say 80% to 90% of the businesses that I've come in contact with, maybe probably even higher, fail to understand the big picture. And then they fail to understand how they get the most value out of the people that are working and what good looks like for those people. And then the third layer is you have to start putting some sort of structure in place in terms of process on, you know, how people are going to do their jobs, which is distinct from is this person doing a good job? And so going back to that people, processes and tools, the people and process side of things is where a tremendous amount of opportunity lies. And it's also where a tremendous amount of money is just getting wasted and flushed down the toilet on a regular basis for almost every business. I also think that it's important when thinking about your own business for anyone listening to this is to not feel like there's something wrong with you because your business isn't perfect. There's no business that's perfect. I literally have 30,000 hours of consulting experience at this point with startups all the way to billion-dollar companies. And I can tell you without any question, I've never come inside of a business, no matter how well they're performing, that is perfect. It just doesn't exist. And so there's this idea in somebody's mind. I went through this in one of my first businesses where, you know, I didn't know what I was doing. I came from a corporate background and I was like, oh, I'll just hire a bunch of people and I'll get this thing going. It was like a complete mess. And I felt so much shame and judgment towards like, oh, I better not tell anyone how messy this is because I. I bet nobody else's business is this bad. And it turns out like everybody's business has, you know, warts and bruises and hair on them. And I think if you're clear on where we are, big picture, then drill into where we need to focus and make sure that we have a system for managing people's performance. And then a process that everyone is following. It definitely solves a tremendous amount of issues and it will absolutely and undoubtedly prevent some of the monumental waste. that's happening inside of the company.

• Speaker #0

  I've always found that people have to know where to find things as well. People waste a lot of time. And if we have a task in the description, we usually have a link to the policy, which has the SOP in it. But like you said, who to report to, how to quantify. And two things, the templates. Do you have templates? Where are they? And they're usually in the same folder and training. So instead of going back and, you know, bothering the person, look at the video. It's a step-by-step through the SOP. Then if you still need help, then no problem. So that's one thing. The other thing that I learned this from a friend of mine is to get the, we just call it a strength weakness process at the end of the week where. Five strengths, five weaknesses. So how can we, what worked for you, what didn't work for you, what do we got to work on? But this is the big training. We offer training to anybody who wants to train. So part of us is one day, one hour a week, five hours a week, we pay for the training and we help you become excellent in whatever you want to achieve. Now that does help. with a lot of this. But again, just going back to what you were talking about, being able to find things. and understand them and implement is really important. And a lot of companies that I found don't have a place for that. They might have a Google Drive with SOPs. You got to go to the SOP folder. You got to figure out these, you know, a hundred SOPs. And by the way, I don't know how you feel about this, but you know, I come, I have a SOP on making coffee. I mean, I used to make SOPs on everything. But what I found now is you don't have to make an SOP on every single step. It, it, it, you know, it's just not required.

• Speaker #1

  Yeah. I mean, I think you could get really carried away with SOPs, like making coffee potentially.

• Speaker #0

  There was a reason for that. There was a reason for that. Yeah. So you have to have buy-in.

• Speaker #1

  Yeah. I think, I think you also, you know, one thing that needs to be said here too is You need to hire people who know how to do the job that you're hiring them for. A lot of times, we as entrepreneurs are really curious, and we're good problem solvers, and we're good with lots of ambiguity. But a lot of people aren't. And so when we bring them into our company, and we're like, all right, well, like, they'll figure it out. I'll put them through some training, and they'll get the hang of it. We're like, really not doing anybody a favor. we're not bringing in a person who's capable of doing the job potentially, or who even has skills to do the job. And then not only do we put them in an awkward position, we also put ourselves in a position where we don't get the results that we need. Right. And I'm reminded of a Warren Buffett quote where he's like, you don't go out and buy a dog and do it barking for it. Right. You like you, you get somebody, you get a dog. So the dog can bark. Right. And similarly, when you're, you know, when you're bringing people into a company, you bring them in. Because they know how to get the result that you are looking for. All too often, I think as leaders in an organization, we try to focus too much on telling people how to do their jobs instead of telling people what good looks like. Like, what does good look like? Good looks like we're getting this customer acquisition cost. It doesn't look like me telling you exactly how to write sales copy on a page. so that we can get that customer acquisition cost. If I have to get to that level, then either I don't need the person that I hired, or I'm just having a really tough time letting go. And I think we need to be masters at telling people what needs to happen and where we need to go and making sure that we're bringing people on who know how to do that. It's important to manage based on objectives and not by tasks. Because if we're just managing on tasks, then we never get the opportunity to get the kind of leverage that we're looking for. And we also will not really attract the right level of quality and caliber of talent that we really need to grow and scale a business.

• Speaker #2

  So where does 57 hats come from? Did you just sit down like, okay, there's 57 different things. Do you want me to do or say like, that sounds like a cool number. Let's, let's call it the 57. I like Heinz ketchup.

• Speaker #0

  What, what, what,

• Speaker #2

  what did, what did like, like Norm does on his macaroni. What, what, where is the Canadian thing? I don't get it. What were you like Tom from? And for people that are listing, and I know they can go to your website and buy this, I'm assuming probably get it on Amazon, a few other places. And it's, it's a game. It's a, it's like a box. like board game kind of thing or explain what what the the game is and then uh the concept of how that helps people get clear in their mind and then like you said earlier the opportunity to take go from the game and getting some clarity to actually getting you uh or your team on the on the phone to really dive deep yeah

• Speaker #1

  so so just the short answer to your first question about whether it was just because we like high and sketch up on our macaroni like which i i don't know if I'm going to be able to eat with Norm anymore knowing this. As an Italian guy who grew up in New York, I'm like, oh, my God. I can't imagine putting ketchup on my brownie.

• Speaker #2

  It disgusted me, too, the first time I saw him.

• Speaker #0

  What are you doing? It wasn't just ketchup. Red hot sauce, too.

• Speaker #1

  Oh, wow. Okay. So it gets even better. But in any case, we sat down and we were kind of like, all right. Let's think of all the different roles that a typical business could have in their company. And the number was somewhere around 57. Like after we whiteboarded out and all this other stuff, there's actually more cards in the box than 57, as it turns out. But by the time we kind of like locked that in, we already liked the number 57, how it was literated, everything like that. But essentially what the product is, it's almost like having a consultant in a box. and it's got a deck of cards greater than 57 and each card has a hat, right? So if you think about all the different roles that you might have inside of a company, you know, you might have a executive assistant or you might have an operations coordinator or a controller or a CFO or any of these things. And so each card has two sides to it. And on one side, it has the picture, a cool, you know, kind of fun, creative picture of a hat. that corresponds with that role. And then on the flip side, it has the key objectives that that role is there to fulfill, right? And so there's all these different roles and all these different hats inside of the box. And then we have a game board that has two sides and basically go to side one and side one helps guide you through this process of what should you delete, what should you delegate, and what should you do? And it has prompts and asks you questions. And so you have the game board out and you go through the deck of cards. And the very first thing that you do, if you're the owner or the founder is you're like, OK, yes, I'm wearing that hat. No, I'm not wearing that hat. You just kind of sort the cards into two different piles and the pile of like, hey, here's all the hats that I'm wearing. For a lot of people, the first time they go through the game, it finally makes sense why I feel spread so thin. And I'm so stressed because I'm wearing so many hats. And it's interesting. I think an unanticipated benefit of this becoming a physical product as opposed to just having slides or some online component was when people hold that stack of cards, and these are all the hats that I'm wearing, it really cements in like, I need to do something about this. It becomes visceral and it becomes real. And they can experience the... If you have a... five cards that you're holding versus 25 cards, you feel the difference in the weight. And that difference is real in your business. I was talking to a guy literally right before I had this recording with you guys. And he's like, I went through the game and I was blown away by all the hats that I was wearing. And I showed my wife. And for the first time, she was like, oh, it makes sense why you're so stressed. I can see all of the hats that you're wearing. And so if... The game does nothing else. It does a lot more. But if all it did was help people get an awareness of these are the hats that I'm wearing and I need to do something about it, it serves that purpose. Obviously, it goes far beyond that. So then from that deck of cards, then we ask questions on the game board that help people understand whether they should just completely get rid of something. Because there's a lot of times when you're growing a business that what you used to do a year ago or two years ago or more. You just kind of have been doing it, but maybe you don't even need to be doing it anymore. And that's an opportunity to eliminate waste. And then the next two sections are, do you delete this hat? Sorry, delete it as first. Do you delegate this hat or do you do it? And so we've got questions that guide people through that as well. And so by the end, you have this deck of cards that says, like, these are the things I need to delegate. And these are the things I need to do. And you flip the game board over and there basically is like, okay, who do I currently have on my team and who do I need on my team? And so then you start sorting the cards based on those five pillars, the marketing, sales, delivery, operations, and finance. And at the end, you're like, okay, I can delegate these cards to the people that I currently have on my team. And the cards are dry erase and we include a marker in the box and you can write people's names on it. So as soon as you're done with that, you can start delegating to those people. but not with just like, hey, go do this. But there's objectives on the card so that you're clear on what they need to be doing. And then the future team helps you understand what apps you're still going to need to hire for. And so it really is like, from taking people from overwhelm, like I just feel overwhelmed, which is a feeling that every entrepreneur can relate to. I feel overwhelmed to, oh, wow, I know what I need to do now. And the process really doesn't take, you know, 20 to 30 minutes. to go through the game. And you can do it on your own as a founder owner. You can do it with your leadership team if you have a leadership team. I've got a video recording from a guy the other day. He's like, we weren't really sure what to expect, but we took 57 hats to our offsite. And it helped us plan out our org for the next six months. And we didn't know going into that how we were going to tackle that. And so it's a really useful tool. in helping people get clear on diagnosing what's slowing them down and also what hats they're wearing and what hats they shouldn't be wearing um so that's that's kind of in a nutshell and you've got one there norm right yeah yeah

• Speaker #2

  i'm gonna have to give me one i'm gonna have to go on the 57.com and and order it yeah yeah we'll uh we'll get you one kevin for sure and it's on uh it's on amazon as well but yeah the one thing

• Speaker #0

  that I noticed when I first received it is the quality. You know, this is a great game, but also you put quality into this. The game board is high quality. The cards are great quality. The box itself, the old, you know, anticipation, you know, it takes a few seconds to open it up. But I think when people are going to buy this, it's the old perceived value. You've already told us about what the game is. But when you receive it, like when you sent that this over to me, as soon as I got it, it just looked like it already had quality even before I opened up the package to take a look what was inside.

• Speaker #1

  So I appreciate you saying that we, you know, we put a lot of a lot of effort into creating a real product. Right. This isn't this isn't a, you know, kind of a BS product just so that we can capture leads. This is a product that if somebody buys it and never talks to us ever again, they're going to get value just by using the product. And that's what we wanted. We wanted it to stand on its own two feet. We wanted it to feel like a creative, engaging way to tackle a problem that every entrepreneur faces at some point or another or on a regular basis and in a way that feels approachable. It doesn't feel like I have to hide. From putting this off, like the question of like, oh my God, I know I need to hire somebody, but I don't know who. That's a real thing that everybody faces on a pretty regular basis, especially if their business is growing and people trap themselves in roles that they shouldn't be in for far too long and sacrifice growth because they don't have a solution to how do I deal with that? And so we wanted to put this product out into the world and help. entrepreneurs be able to grow faster and have an intelligent way to map out what they're doing and what everybody else on their team is doing.

• Speaker #2

  What do you find is the hardest thing to get an entrepreneur to change? They go through this process and then they know they need to change it. They know like, I need to hire this person or get rid of these 12 cards. But what do you find is like the hardest thing for them to let go of usually?

• Speaker #1

  I think letting go. It's probably the right word. I don't know about you guys, but I know in my own experience, I can be a control freak. I can have a hard time trusting people. I can find it difficult to delegate. All of those things, I think, become hard. And what I think can help overcome that is the understanding that you don't have to hire all these hats at once. You don't have to do everything at once. You can do one at a time and start getting those reps and building the practice of hiring good people and having that performance management framework that I mentioned earlier in place. But letting go in general is scary for entrepreneurs because you've spent time building something, creating something. And to think that you're going to start handing it off to other people can be really intimidating. Taken to the extreme. most entrepreneurs will never have an exit from their business. I don't know if the stat is current, but some time ago, it was like 86% of businesses that got listed for sale, just the ones that went with a broker and listed themselves for sale. 86% of those would never sell. That doesn't take into account all the ones that were built but never listed. So the number of businesses that don't sell is really incredible. And a lot of it comes from you an inability to systematically let go and separate yourself from the business. Because many entrepreneurs wrap up their identity. and conflate it with the business. Like I am one with this business and it's a...

• Speaker #0

  It's a really unfortunate thing to think that you are your business. And if you start operating like that, it becomes harder and harder the longer you go to unravel that. And it's not impossible, but it becomes more difficult. And so I would say letting go, Kevin, is probably the number one thing. And if all 57 Hats does is help people start chipping away at that and let go little by little in a way that's not destructive to the business. can still preserve the growth because they're doing it the right way, I think 57 Hats would be a big win. Philosophically, I have a major problem with how illiquid small businesses are in the world. And one of the things I'm on a mission on is to help create more liquidity in that market for the entrepreneurs that work so hard to build those companies.

• Speaker #1

  Hey, Kevin King and Norm Farrar here. If you've been enjoying this episode of Marketing Misfits, Thanks for listening this far. Continue listening. We've got some more valuable stuff coming up. Be sure to hit that subscribe button if you're listening to this on your favorite podcast player. Or if you're watching this on YouTube or Spotify, make sure you subscribe to our channel because you don't want to miss a single episode of The Marketing Misfits. Have you subscribed yet, Norm?

• Speaker #2

  Well, this is an old guy alert. Should I subscribe to my own podcast?

• Speaker #1

  Yeah, but what if you forget to show up one time and it's just me on here? You're not going to know what I say.

• Speaker #2

  Okay. I'll buy you a beard and you can sit in my chair too. And we'll just, you can go back and forth with one another. Yikes. But that being said, don't forget to subscribe, share it. Oh, and if you really like this content somewhere up there, there's a banner, click on it and you'll go to another episode of the marketing misfits.

• Speaker #1

  Make sure you don't miss a single episode because you don't want to be like Norm. Oh.

• Speaker #2

  You know, one of the other things that I think a lot of entrepreneurs, especially at the beginning, mostly at the beginning, it's like you were talking about letting go, but they expect perfection at the very beginning. And they're the only ones that can do it themselves. And as soon as somebody screws up. Well, I knew it. They were going to screw up and they get rid of the person. And that could be training. You got to give time. You can't expect 100% when you just hired somebody.

• Speaker #0

  Yeah. And you also have to give them clarity. Most people won't even tell the person they hired what good looks like. They're not even on the same page with, how do you know when this person's doing a good job? It's like a feeling. You know, maybe you didn't sleep well last night. So you wake up today and you feel, you know, wake up on the wrong side of the bed and you're like, oh, that person's not doing a good job. They may have done the exact same job they did the day before when you're in a good mood. And if there's no way to communicate what does good look like. Oh, Kevin King.

• Speaker #2

  You just have to look at him.

• Speaker #3

  I just sit on my picture and say, this is what good looks like. Do that.

• Speaker #0

  We might not even need 57 hats now.

• Speaker #3

  Just an upviction. I just thought, yeah, he bites hands. Good. Just one hat. One hat. One hat. Yeah.

• Speaker #0

  It's the Kevin hat. If you answer Kevin hat, it's like an ace of spades. It just trumps it.

• Speaker #3

  I am the king, you know.

• Speaker #0

  That's true.

• Speaker #2

  He tells me that all the time. All right. We're at the top of the hour, and we always ask our guest. are misfit if they know a misfit.

• Speaker #0

  Yeah. Well, I think either one of my two co-founders of 57 Hats would be a great guest for the show. Yada Golden or Mark Stern are both fantastic entrepreneurs. And I think you probably have a great time with them on the show as well.

• Speaker #2

  Oh, fantastic. Well, we'll have Mary reach out to them.

• Speaker #0

  Please do.

• Speaker #3

  And if people want to learn more about your company or... get the game, what, what should they do? Reach out to you. What's the best way for them to do that?

• Speaker #0

  If they want to check out the game, 57 hats.com super easy to remember on, they can just go there. And if anybody has any questions about it, absolutely. Feel free to email me, James at James P. Frail.com. Um, yeah, but that's pretty straightforward, Kevin.

• Speaker #3

  Awesome.

• Speaker #2

  All right, James. Well, thank you so much for having, or coming on to the podcast. You were awesome.

• Speaker #0

  Well, thank you guys. We had a lot of range here. We went from blood councils to organization planning.

• Speaker #3

  No, we went from runs. Remember that?

• Speaker #0

  Yeah, yeah. We need to bring that up again, Kevin. I don't want to get stuck down here on some kind of no-fly list.

• Speaker #2

  Yeah. All right. Well, thanks a lot. We will see you later, James.

• Speaker #3

  Appreciate it. Thanks,

• Speaker #0

  James.

• Speaker #2

  That was always good.

• Speaker #3

  Always good stuff on the Marketing Misfits. And that's right up your alley. All the systems and the processes and everything. That's my weakness. And that's your strength. And so that's why we have Dragonfish, right?

• Speaker #2

  Yeah. Oh, by the way, I got to tell everybody, this is worth sticking around, guys. Kevin, the first event that I met him at, oh, it was the second one, I think, they gave away prizes. This was the Helium 10 or the Illuminati, it was called. at the time. And he was giving little gifts away to everybody that participated. Well, it's not a practical joke. He just came up with these really, he's always known for these really cool gifts. So it was in a wood container, like a spider. And I threw it in my luggage. I get to the border and all of a sudden I see all these border patrol people coming around me like, what's going on? And the problem was, I... I have to be careful what I say because I can get, you know, some problems with YouTube. But it had a cap on it. It was in a metal cylinder and it had wires. And they thought it was something that you shouldn't have in an airport. So I got detained for probably over an hour while they searched me, searched my bag, searched everything. And I still have to thank you for that, Kevin.

• Speaker #3

  You're welcome. To tell everybody what it was, this was 2018, maybe? Yeah. 2017, 2017. And we had just done this conference down in Mexico, and we wanted to give everybody the slides, the PDFs of all the presentations. And so instead of putting them on a Google Drive or whatever that people do now, we just dumped them all on these USBs. But we wanted to make it a unique USB drive. And so it was a cylinder. It looked like a lipstick container, long and cylinder. It was clear, and inside were all these. wire.

• Speaker #2

  It was clear. It was not clear. It was a aluminum cylinder with two packs on the end.

• Speaker #3

  Cause it would light up. So when you plugged it into USB, it would, the whole thing would light up like blue color or something and look, look kind of cool. And it's different, but, yeah, that, that's what it was. And, Norm didn't realize what he had in there. And, the customs people didn't, didn't appreciate, the strange looking object, and, and his, and his luggage.

• Speaker #2

  Anyway, I had to share that. Because of some of these interesting things.

• Speaker #3

  Speaking of sharing, if you like this episode with James, be sure to share it and send it on. Hit a like. Subscribe to the channel that you're watching this on because that's how we know that you're out there and you're enjoying what we got and that you made it to the end of the podcast. So do that. And, you know, we got tons of podcasts. We have a new episode that comes out every single Tuesday. So if you like this one. Check out, we've had people like Neil Patel and Forbes Riley. And the list goes on. Some pretty big time marketing guests on there. And some guests that people don't know, but they should know. So check that out. And where do they do that, Norm? How do they check that stuff out?

• Speaker #2

  A few ways. So you can go to YouTube and you can see the long version at Marketing Misfits Podcast. Or we have one that we've created another YouTube channel, Marketing Misfits Clips. where you get three-minute or under clips where, for example, this one, every day we'll publish a three-minute clip. So you can go there and see all these nuggets. I hate the word nuggets, but nuggets that you can just choose, and it's three minutes or under, and you're getting a ton of value. You can also go over to TikTok. We've got a great channel over there, and we're probably four or five months into launching that channel by the time you hear this. So, yeah, that's it.

• Speaker #3

  Awesome. We'll see you guys again next week. Take care.

• Speaker #2

  All right. See ya.