- Chew On This
- 🥗The #1 Skill Every Business Owner Needs
🥗The #1 Skill Every Business Owner Needs
Welcome back for another bite to chew on
First of all - happy belated thanksgiving to all of you.
Secondly - we hope you had a great Black Friday and are ready to crush Cyber Monday as well.
In this week's newsletter – we'll talk about something that we've probably dedicated 70% of our time and energy towards over the last couple of months…
… and that is; Hiring & Delegation
Although it can seem easy from the outside to "just" hire people and get them to do stuff – it's actually really damn hard.
So – in this newsletter, we'll share some thoughts and learnings we've had over the last couple of months, where we've hired somewhere along the lines of 15 people (5 per month) across our different companies.
But before we dive into it;
1. We have an upcoming event on the 7th of December in New York. The last two events have been a complete blast with over 100 founders coming together every time. RSVP to the event here if you want to join
2. A few weeks ago, we launched our Season 2 finale with Harley Finkelstein who dropped some golden nuggets on the future of e-commerce. If you haven’t yet given it a listen, make sure to get it on your to-do.
Without further ado – let's dive into it
Looking at employees as stocks
… and it really resonated with us, so we thought we'd share it with you.
In the podcast episode, Sam talks about this notion of being a "collector of people".
Ultimately – great people build great companies, so 80% of the role of the executive team should always be to hire & train great people.
Some people are overvalued, some are fairly valued, and some are really undervalued.
"Looking at employees as stocks" essentially means looking for the stocks (employees) that are undervalued, buying them (i.e. hiring them), and then turning them into high-value stocks (through training and exposure to complex problems)
Like the stock market, you don't come across these stocks daily.
… but – there are a few tell signs as to whether an employee is an undervalued stock, and that is mainly in their character traits;
Here are some of the "tell signs"/ characteristics we're looking for.
Speed and responsiveness
Money loves speed, and you can typically tell how successful someone will be by how fast someone executes a given task (for example, a sample task) or how fast someone responds to an urgent matter.
Openness to feedback & adaptability
When you're working in a fast-growing company, the marketplace will give you rapid feedback as to what you're doing right and what you're doing wrong.
If you can't change direction fast, you don't fit into any of our companies (and probably not in any startup overall)
Testing adaptability beforehand is hard, but it's relatively easier to test for how well someone receives feedback
… by actually giving feedback.
Extreme sense of urgency
From one day to another, any of the companies we build could go to the ground if we're not constantly executing, innovating, and building.
Every single day, there are 10 competitors out there trying to take your market share – so if you're not building with extreme urgency, one of them WILL eventually take your market share.
Are they taking enough shots at goal?
No matter how smart or talented you are, a lot of success in business comes down to taking a ton of shots on goal.
Some call these micro-bets. Some call these split tests.
But in the end – it's all the same.
It's an attempt to improve a current situation by trying something new or better.
A handful of good questions to ask your candidates are;
- How many jobs did you apply for?
- In your previous company/role, what was the hardest thing to improve?
- Follow up with; How many different approaches did you take to improve it
Do they have figure-it-outness?
The last thing you want in your company is someone who can only go in the direction you tell them to go.
These types of people will end up sucking more of your time than giving it back to you.
To test for this; Ask about a situation in their life where they had their back against the wall – didn't know what to do, but still figured out a solution.
The Story about the monkey on the back
… One of the most interesting things in this podcast was the story about the "monkey on the back" that Nick talked about.
Here's the Story in bullet points
Whenever an employee has a problem, they have a monkey on their back. The monkey is representing a problem.
To solve this problem, the standard response from an employee is to come to you, as the leader, and take the monkey OFF their own back and put it right on your desk.
I.e. – whenever they have a problem, they come to you to solve it instead of trying to solve it themselves.
If you train your employees to behave in a way where they will always walk into your office, take the monkey off their own backs, and place it on yours – what do you think will happen?
You will soon have an office FULL of monkeys (problems), and you will actually have less time and bandwidth than BEFORE you hired people. Because not only do you have your own monkeys, but now you also have to deal with everybody else's monkeys.
This has definitely happened to us a lot in the beginning – and if you're relatively new to the business, chances are, your office is full of monkeys, too.
Here's how to get rid of the monkeys and put them all back in a cage;
Whenever someone comes to you and asks for help with a problem, always give them direction – but never solve it for them.
If you hired the right people to begin with, they should be able to put the monkeys back in the cage, if only you tell them what direction the cage is located
Always put the monkey back on their back
If you get in the habit of taking people's monkeys and trying to cage all of them yourself, you will soon have a big problem (i.e an office full of monkeys)
If somebody continuously comes and puts their monkeys on your desks – fire them
This is the brutal truth. You don't hire people to give you extra work.
The top players will learn how to cage the monkeys themselves and NOT put their monkeys on your desk
Answer a question with a question.
Similar to the notion of always giving the monkey back, you can ask a handful of questions to make your employees think for themselves and solve the problems themselves too
What's the simplest way to solve this?
How have other people done this? Can we go and study them and then try to model what they've done? Or can we go talk to them?
What's the core thing we're trying to solve here, and what's the main thing that's holding us back right now
Oftentimes, merely articulating and stating the problems is 50% of solving them. But most people don't know how to clearly state them.
Tool of The Week
Over the entire month of November, we've spent upwards of $1,000,000 on paid advertising.
… but do you want to know the craziest part about this?
We haven't taken a single penny out of our pocket to pay any of this yet.
… and we won't do so until the end of February.
It's a simple concept called financial engineering.
In simple terms, it basically translates into extending the time you have to pay your bills so you can sell your products BEFORE having to pay for them.
Here's a concrete example of how we do this with paid advertising;
- Meta gives us a net 30 on our paid media spend
- We put the media spend on a Parker card, giving us 30-60 days to pay the bill.
Meaning – in total, we have approximately 90 days to pay it.
… and that means two things;
A) We can spend more aggressively than most of our competitors.
B) We have stronger cash flow that we can re-invest back into other parts of the business – whether that's more ads, more people, more inventory – or whatever.
Now of course – there's no such thing as a free lunch.
… but, there's such a thing as a bargain.
For example, we pay 3.4% in fees for our Parker card, which can sound like a lot.
But what if that 3.4% can allow us to spend 2x what we could otherwise spend on Meta?
… and that 2x could translate into an ROI that’s marginally higher than 3.4%?
Then we’re essentially borrowing money short-term from one place, to invest them back in another place with a higher return.
Very similar to how the banks make money actually.
If you want to do the same for the upcoming Christmas sales and Q1 sales - we’d strongly recommend you to reach out to Parker and get yourself set with their platform, so you can do the same
Thanks for reading along
As always - thanks for reading along!
We hope this newsletter was valuable to you, and we look forward to seeing you again on Wednesday.
All the best
Ron & Ash