WEBVTT

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Business owners, I think we can all agree that one of the most important things that

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happens as we grow is that we learn frameworks, and that's why when you look back at what

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you used to accomplish, you know, years ago, it seems like you could fix this problem

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so easily because you have frameworks with which you've learned to think.

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Welcome to the game where we talk about how to get more customers, how to make more

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progress, and how to keep them longer, and the many failures and lessons we have learned

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along the way.

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Hope you enjoy and subscribe.

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Business owners, I think we can all agree that one of the most important things that happens

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as we grow is that we learn frameworks, and that's why when you look back at what

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you used to accomplish, you know, years ago, it seems like you could fix this problem

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so easily because you have frameworks with which you've learned to think, right?

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And so it took me six years to build my first eight-figure company, six and a half

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to build my first eight-and-a-half figure company, sorry, multiple eight-figure company

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because that was the same company.

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The next company that I did that was, multiple eight-figures was, it took me a year to build,

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so one after that, it took me six months.

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And so we've gotten faster and faster and faster at doing this, and I know I've done

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over 120 million in sales across different industries.

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And one of the key frameworks that I've developed or helps me think through things is someone

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who's shared with you today, all right?

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So there's kind of three levels of employees or talent, right?

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And this really implies to you or your team itself because at the beginning it's you,

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right?

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And so depending on where you're at, you may be at one of these levels, or you may have

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to recognize it in others.

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And I'm going to say in three different ways, so I have a nice little nine grid here.

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The simplest way to think about this is in the beginning, you have to learn what to do,

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all right?

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These are the skills, right?

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And that's because what you are in the beginning is an individual contributor, all right?

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That means you actually have to get things done in order for them to, you know, happen,

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right?

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And so what you're doing at this point is you're doing, right?

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All of your time is spent doing the things, right?

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Learning what to do, et cetera.

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Now, the reason it's really important to be able to recognize where you're at is because

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then you'll be able to look through this framework and immediately see what you need to do next.

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To the same degree, you may have gone through this, but not have recognized the shifts.

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And you can look at an employee and say, I think they are in this bucket.

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I think they're in this bucket.

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I think they have the potential to get to this bucket, et cetera.

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Many times people will stick at one level because of their own beliefs that they have about

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themselves, which is why we, you know, Laila and I believe that identity is very fluid.

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If you want to be successful because you have to be able to change what you think about

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yourself in order to become the thing that's going to debottle neck the business because

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ultimately, it's costing every single human on earth a billion dollars a year, not knowing

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how to create a billion dollars a year in revenue, right?

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And that's how I always think about this is like, it is costing me so much money.

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My ignorance is costing me so much money.

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And so hopefully with this video, I'll break down some of the other things that you won't

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be ignorant to so you can recognize them and other people.

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So level one is understanding what to do, right?

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Which means you're an individual contributor and what your time is spent is doing, all right?

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The second level here is understanding how, all right?

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So you started to do it, right?

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The what?

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You figured this out.

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But then you have to figure out the how you're actually doing it, right?

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The reason for that is because of the next level, you become a manager, all right?

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And that's making sure that other people can do that thing and they're consistently executing

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at a level that works, right?

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And so here what you're doing is you're teaching, right?

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You're teaching other people to do the thing, right?

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And so at the beginning, you're doing, right?

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As an individual contributor, you have to focus on what it is, right?

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The next level you're doing, you're doing all the doing and you're like, you know what?

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I feel like I understand this better, right?

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I feel like I understand the sequence of how this works, right?

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And then you can teach other people how to replicate that skill.

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And at the very end, I'll show you how to apply this to departments in a second, all right?

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So stay tuned for that.

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But this is level one, right?

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As you're looking at yourself or an employee, right?

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Level two is, oh, I think this person could teach other people.

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I think they could manage them.

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And as a quick caveat here, like not every, like managers don't necessarily need to know

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how to do something better than an individual contributor.

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There's always going to be niche expertise, et cetera, but they should understand how it works, right?

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And so this is just an important, like, just nuance to note there, right?

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The third level is what I look at is the who, right?

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And I know this may sound odd.

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It's like what and then how then who?

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But that is kind of what it evolves to over time, all right?

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The title here is a leader, right?

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And these are very different than managers, which is something that I had to,

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I had to realize as I was scaling the business.

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And usually at this level, this is where you're at your $3-ish million at your level.

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And this is what allows you to crack open to the million plus per month level.

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So 10 million pluses, you have to have leaders that are engaged, right?

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And the thing that you're doing here is your systematizing, all right?

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And so what I'm going to, I'll say this in different way too, because I think it's worth noting,

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is building the machine that builds the machine, all right?

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And the reason that's important is because first you're doing it, then you're teaching it,

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and then you need something that can teach it for you.

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That's kind of how this works, right?

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So it's always, it's not delegating it, it's systematizing.

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So it's really, I was trying to be thoughtful about what order I was going to use there,

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because it's like, is it delegating it, is it handing it off?

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It's systematizing it.

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And there's a lot of different ways you can build a machine that builds the machine.

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But if you think through this in terms of your own frameworks, the reason that I like this

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is that you can actually grade yourself in terms of where you're at.

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You can grade yourself in terms of where a team member is at.

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And you can even grade departments, right, within your business,

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which depending on what your size is, your departments might just be,

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might be things that you are doing, right?

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If you're a partner, for example, then like you wear all the hats,

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your finance, your HR, your legal, your IT, your marketing, your sales,

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your product, your fulfillment, you're all of those things, right?

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But as you grow, you know, in the beginning, you'll have your first core team

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of probably five people, each one of those functions you have somebody helps you with,

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you know, deliver, you'll have somebody who helps you with, you know,

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finance, who does the bookkeeping, maybe somebody helps you with marketing,

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maybe that's you, somebody helps you with sales, et cetera, right?

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And so what you can do is you can look at an apartment and say,

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what level am I involved here, right?

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Real quick, guys, if you can think about how you found this podcast,

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somebody probably tweeted it, told you about it, shared it on Instagram,

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or something like that.

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The only way this grows is through word of mouth.

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And so I don't run ads, I don't do sponsorships, I don't sell anything.

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My only ask is that you continue to pay it forward.

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Whoever showed you or however you found out about this podcast,

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that you do the exact same thing.

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So if it was a review, if it was a post, if you do that,

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it would mean the world to me and you'll throw some good karma out there

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for another entrepreneur.

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And eventually, the goal is that you can move above,

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right, me equals CEO.

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And so you have a team of leaders who are building the machine

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that builds the machine for you so that the actual whole thing

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works without you being there besides providing the vision

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and strategic insight for making decisions, right?

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And so for me, I define this within a business where

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I'm no longer on the Slack channel.

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So in our portfolio companies, if I am no longer on the Slack

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for that company, meaning no one can reach me

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besides the one person who's in charge for that company,

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that is what I believe is a truly delegated business

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that acts as a portfolio where you are actually an owner, right?

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I can't say the amount of times I talk to entrepreneurs.

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And they're like, oh yeah, I could totally take this new project

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on like my business is totally systematized.

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And I'm like, dude, like no, it's not.

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Like your phone's blowing up twice since we've been on,

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like, since we've been sitting here talking, like, yeah,

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I mean, just because you don't have to respond to something

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in the moment doesn't mean that you don't have to eventually

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respond to it or make a decision or et cetera, right?

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Like those are things that are still levels of involvement

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that require your existence and presence.

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And so for me, if I'm not in the Slack channel,

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I have one meeting a week with the owner of the,

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sorry, the owner of one of our portfolio companies,

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the manager operator, et cetera, of a portfolio company.

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And between that time and the next time the company

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can continue to grow without my direct involvement,

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that is what I would say is checking all the boxes for me.

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And if something's not checking all the boxes,

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you can check all the boxes at a business level,

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but you can also just look at this as a department level.

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And the reason I think is so important

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is that it can give you a grade that you can look at to improve.

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So you might have marketing and you might have sales

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and then you might have product and then you might have

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shared services which would be like IT, legal, HR,

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all that kind of stuff, right?

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And you can look at yourself and think, okay,

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do I have in sales, for example,

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do I have people who can, like,

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am either one doing the sales?

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Okay, well maybe I'm not doing the sales,

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well I'm the one who's teaching people at a sale.

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Okay, well have I built a machine

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that teaches people at a sale

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so that I don't have to do the teaching of selling.

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So I can actually just bring people in on a consistent basis

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and get them up to speed, right?

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That's where you start looking at like hiring

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one, two, three sales people a month, right?

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And then you put them through the machine

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that builds sales people, right?

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And so you can look at these levels

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within each of the departments.

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So so maybe that's where your sales is at, right?

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You've got a machine that builds the machine.

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Awesome.

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But is your marketing there, right?

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Do you have a machine that builds the machine there

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or are you still doing or are you still teaching people, right?

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And here's one of the things that I think for me,

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it took a long time to realize is that

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it's actually your strengths oftentimes

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which become almost always the bottleneck in the business

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because the things that you don't know,

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you're far more comfortable giving away to people

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so that they can build these things, right?

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Because they have better expertise

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because they know how to do teach, et cetera.

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And that's where you as a CEO as an entrepreneur

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is you actually have to walk them through these things.

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So it's like, okay, great.

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So you know how to do some, whatever it is,

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the delivery of your product.

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You tell someone to do that.

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It's like great, now I need you to teach someone

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else how to do that.

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So we can build a team of people

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who are doing that so we can scale, right?

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And then finally, at a certain point,

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it's like, man, I'm spending all my time teaching.

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And it's like, okay, well, we need to build the machine

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that does the teaching for you.

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And so I think if you can think through this framework

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for each of the departments that you have in your company,

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you'll figure out where your bottlenecks are.

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And it'll at least give you a grade.

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And so every quarter you can look at your business

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on a little sheet like this and think, okay,

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do people know what to do?

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Do we have the base skill?

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Okay, do we have the sequence to the how to do it?

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Teaching people step by step how to do this process,

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right, and hold them accountable.

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And then finally, can I find somebody who can help

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systematize and build the machine that builds the machine

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that recreates the skill over and over and over again

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in other people, right?

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And so that's kind of the process.

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And what's interesting, if you listen to Reed Hoffman,

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founder of LinkedIn, he talks about the difficulty

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for most employees, most people

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to jump these levels.

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It's very difficult for most people,

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which is why especially like rapid growth companies,

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they'll often have to, you know, change out.

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I'll say leadership with quotes here,

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just anyone who's in charge,

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because in the beginning, there's probably more managers

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and over time, there need to be leaders.

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And a lot of times the managers,

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despite their tenure, aren't actually leaders, right?

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And so when I'm looking at talent within our own business,

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I'm thinking, okay, who's a good individual contributor?

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And sometimes, sometimes amazing leaders

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are terrible individual contributors.

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And sometimes, a lot oftentimes, good individual contributors

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are terrible leaders, right?

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And so it takes a very unique person,

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which is why being out first so hard

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is that you have to really master all of these levels

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so that you can recognize it and teach it in other people.

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Because ultimately, what we're doing

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is we have to walk the path that every person

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who's behind us must walk,

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which is why entrepreneurship is such a growth-oriented,

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you know, occupation.

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Like, you have to grow yourself

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in order to attract people who are at a certain level, right?

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Like, imagine, if you were to start working for somebody

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and you feel like you know way more than them

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and that they're just have no idea what they're doing, right?

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Then it's unlikely that you're going to be very influenced

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by that person.

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That person's not going to inspire you to do anything.

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On the flip side, if you were to start working for somebody

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and you aspire to be like them,

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you like their character traits,

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you love the way they operate in their personal life

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and how they do business, et cetera,

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then that is somebody that you were being led by, right?

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And so for us as entrepreneurs,

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like, a lot of times, we have to think

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like, how can I improve my character?

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What are the traits of mine that are deficient

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so that I can hopefully inspire people

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that I can bring people in at this higher level,

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and then actually be able to execute

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because I can't tell you the amount of times.

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I can't even say, like, most entrepreneurs I talk to,

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I'd say 95% of them are like,

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oh, my team's amazing, I love my team, they're awesome.

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And at the same time, they have all these horror stories

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about teammates and I can't say, like,

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the amount of times that I've talked to somebody,

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they said their team was awesome,

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then I talked to them nine months later, like,

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oh, no, no, that team was an awesome.

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This team's awesome, right?

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And I'm like, dude, you're the perspective

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in which you make judgments is flawed

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and I don't believe anything you say

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because every time you've said this,

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it has been wrong, so why would I believe differently now?

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And so, these are the levels that I think are for myself,

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my employees, departments, and then ultimately the business.

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This is just a different way of thinking through it.

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Hopefully, it was valuable for you.

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If you have these frameworks,

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you can look at your own businesses,

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apply things faster and break through the bottlenecks

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that you have so you can get to where you wanna go.