You're Stuck Because You Built the Bottom Layer, Not the Top

0:00Alex, thanks for coming down, man. We appreciate it. >> You bet. >> Um my name is Wouter. I run a skin care business. >> it? >> My name is Wouter. I run a skin care business and we uh sell skin care to women age 55 to 65. So, e-commerce direct response funnels. >> All right. >> And then we have a phone sales team on the back end. >> Okay. >> And so, the thing that has stopped us uh the past 2 months, >> excuse me, >> Revenue?

0:25>> My revenue 4.5 million a month and we want to get to 25. >> Million a month? >> Yeah. >> Okay. >> Yeah. And so, in the sales team we had a big manpower issue cuz we would then crank up ad spend and then we couldn't call the leads. So, now our margins dropped and then we got stuck. Solved that with a recruitment team. And now where the next manpower issue is evident is on the leadership side. And so, we have head of this, head of that, channel owners, head of growth, replacing myself, our COO Kyle as well, making sure that we are no longer well, not no longer, but not doing the same thing in the business any longer as we're moving to higher value activities. And so, talking to your team, I noticed that the amount of people that apply to work at acquisition.com is so high, um between Kyle and I, we're all we're not seeing that many people. Uh and so, we're thinking about now taking that same solution of a recruitment team that we had on the sales side and applying it on the leadership side to solve this issue once and for all.

1:27What do you think? >> Okay. So, 4 and 1/2 million a month, >> Yep. >> trying to get to 25 million a month, skin care to old ladies, >> Yep. >> back end call team, >> Yep. >> you built the bottom layer, you're missing the top layer, which means you're getting pulled into the day-to-day >> Yes. >> fires all the time, which means you can't be strategic and actually run the business. >> Yes. >> Cool. Um are the roles that are missing one-time hires or are they recurring hires? >> One-time hires.

1:53>> So, in in this for something like this, and do you guys are you guys a part of like any kind of like networks, groups, things like that? >> Yes. >> So, you probably have pretty strong marketing and sales chops. >> Mhm. >> And so, you probably like if you spin your own network, you'll probably be able to find a decent sales or marketing leader. I think where you might where it might make more sense to like hire an outside firm cuz you probably don't have as much >> Mhm. >> um expertise in, let's say, finance, which is going to be incredibly important for you at like right now as you scale. Um I'd say tech in general because of data is going to get really

2:25>> compromised. Yeah, analytics. >> is a [ __ ] show. Uh so, you'll need a tech lead. Uh you'll need finance. You'll probably need soon a head of people who's really like talent management {slash} HR. >> Yep. >> Uh which is both sides of it. Sometimes there are people who come in with more kind of recruitment chops. Some people have more like HR payroll, et cetera, chops. Um that's going to depend on how you advertise for it. Uh those are those are the type of roles that you probably don't have a network for and I would just pay the money to get the head hunter to go get it for you.

2:55>> Mhm. >> The other ones you probably within your network have people who like already kind of understand the way you do business. >> We do, but all my friends are looking as well, if that makes sense. It's always, you know, you know, that kind of do, but, you know, we're hiring ourselves. >> Yeah, I think um like when Leila and I have like a big hiring constraint, like we'll pull ourselves out of the business and say like we're doing a 6-week sprint and all we're doing is taking interviews. >> Mhm. >> Um so, we can find talent. >> [snorts]

3:20>> Now, mind you, that depends on the level, right? Like I I prob- I'm not probably meeting with directors or or managers or anything like that, but if we're hiring a C-suite, like I'm going to be involved in the process. Um and so, given the fact that you guys have sales and marketing chops, you guys will be able to quickly say like this guy's got game or this gal has got game. >> Mhm. >> Um and so, it probably makes more sense for you to get involved more in the earlier part. And the way you do that is you just do cold reach outs. Like when you when you're when you're going to head hunt, it's literally it's an outreach game. >> Mhm.

3:46>> And if you are CEO, the response rates are significantly higher. >> Mhm. >> And you you still use the same intro message, which is like "Dude, you seem perfect. Your experience is amazing. Do you know anybody who's exactly like you? I have this great business opportunity." Not once have I used that but like I've got this this great role. You know, it pays this. I'm looking for somebody who's like you. Do you know anyone?" And then they're like, "Fuck my friends. I'm interested." Uh Right? And so that's that's an easy cuz that way it's like it's a little bit like low pressure cuz that way they can say like, "Oh, I don't know anyone."

4:16And it's not like as aggressive. >> My worry is that if I were to do that, then the departmental heads that I'm now working with, that the performance goes down because I'm less out of touch. I've noticed that when I check in with people very regularly and I'm, you know, involved in the project. >> is a second issue. So the issue is not one you want to have somebody. >> Yes. >> But the second thing is that you don't trust the person that doesn't exist yet to do their job.

4:42>> No, it's that if I were to pull myself out of the management of, let's say, the six people that report to me today, >> Yeah. >> now there's a risk of the business going down because I'm doing recruitments full-time. And then if it takes longer than expected, now we've got, you know, new fires that I wasn't aware of and then the business >> people that you're managing right now >> Yeah. >> aren't good enough is what it sounds like? Or you're trying to find Like you don't have to replace all six roles at once.

5:11You can run and say, "Okay, of the six, which one's the one that's the most on fire? Let's recruit that first." >> Okay. >> Get that in. I mean, this is growing a business, man. Like and then the second shittiest thing will now go attack that once the first one's fixed. And you just work your way across. I think a big thing that dictates how fast you move in business is your ability to recognize patterns with people and talent because like this is not your first business, I'm guessing. >> Uh first drop shipping, you know, with VAs.

5:37>> Yeah, yeah. Of course. This is your, you know, you've multiple iterations from there, right? And so the thing is is Like the first business I had, I didn't know how to find a salesperson till I found my first salesperson. I was like, "Oh my god, this is what a sales person looks like." And then I was able to duplicate that. And then I was like, "I don't know what a sales manager looks like." So then I have to go through people and like, "That didn't work. That didn't work. That" And then I found somebody and I was like, "Okay, that's what a sales manager looks like." And you have to keep repeating that process across all departments and across all levels. And so, you're able to rebuild businesses much faster cuz you know what all these people look like. And then you reach the level that you don't know. And then that's where it gets slowed down again. And so, that is where for me, like pulling in outside people from other companies where I'm like, "Hey, can you just talk to this person I'm about to hire them? Do they seem legit to you?" Like I Like I don't know [ __ ] about legal. But like Like can I pull up some of my attorneys that I currently pay and say, "Can you just like talk to the person I need to assess as an in-house counsel?"

6:24So like I try and vet as many of these things where I don't have the contacts and I just can only go off of like human judgment rather than expertise. This is where the kind of like head hunting firms, especially for more technical skills, uh come in handy cuz they'll If they're good, they're more blue chip, they'll do technicals for you. So it's like I don't know much about like an AI lead. It's like, "Cool. I'll have I'll have our technical lead go do the interview for the skills base and then you can go do cultural and then how it would fit within the company.

6:49>> The positions that we're hiring for are typically going to be between 100 and 200,000 a year. And the recruiters they charge 20 25% of the annual package. And so, there's also a, you know, money issue there as well where if for these, you know, six seven roles, if we are going to pay 25K 40K, you know, for these positions >> Per month, you mean? >> Uh no, just on a hiring fee to pay the recruiter. That would be a significant cash impact, which is why as we're talking, we think let's take it in-house, get some recruiters, think it a month, and now that cost isn't, you know, such a [ __ ] as a big

7:21>> [laughter] >> Again, if you're doing them all at once, it'll be a bigger cash hit. If you do it month over month, it'll You'll probably feel it less. But the other way to frame this is it's an investment in the business. If this person does their job, they should make you more money. And so like would I pay 40 to make 400? Yes. Great. And so, you're just again, this is a risk-reward thing. I'm trading the money today to make 400 tomorrow. >> Mhm. Got it. >> So it's just a reframe. And you're like, man, this feels like I'm risking stuff.

7:46And you're like, correct, which is why we get compensated when it works. >> And then, let's say all these people are starting to come in. We now have >> overlapping >> onboarding Yeah, on board. Yeah. >> Yeah, work. >> Mhm. >> Yeah. >> Mhm. >> Now I'm just like you're like, business is [ __ ] as I scale. It's like, yeah, it's just always sucks. >> Got it. >> [laughter] >> And you're like, I solved this problem. Then you like look up and you're like, more problems. Right. It's just always problems. >> Thank you. Appreciate it. Thank you.

8:12>> APPRECIATE IT. >> [applause] >> IF YOU'RE A BUSINESS OWNER AND YOU ARE NOT GROWING as fast as you'd like, I'd like to give you a free gift. So, my team and I put together the $100 million scaling roadmap, which is basically 200 hours of us looking over all the portfolio companies we've had and what stages of growth they went through and more importantly, where they got stuck and how they got past it. And so we broke it into these 10 stages and we made this little kind of quiz thing where if you put in your business information, it'll tell you where you're at and the most important part for you, what to do for each of functions of the business across product, marketing, sales, customer success, recruiting, IT, human resources and finance. And so, no matter what you're struggling with, someone else has already struggled with it and solved it. And so I'd like to give you this thing absolutely free. You can go to acquisition.com/roadmap, plug in your business information and if you want us to actually help you deconstruct your business and you're trying to scale, we'd love to help you out. On the thank you page, you just book a call with my team and we will look at the business, see if we can help and if we can, we'll invite you out to Vegas and we'll do this in person live.