Sponsored by our friends at Veeam Software! Make sure to click here and get the latest and greatest data protection platform for everything from containers to your cloud!
Sponsored by the Shift Group - Shift Group is turning athletes into sales professionals. Is your company looking to hire driven, competitive former athletes? Shift Group not only offers a large pool of diverse sales candidates from entry level to leadership – they help early stage companies in developing their hiring strategy, interview process and build strong sales cultures that attract the best talent for early stage companies.
Sponsored by Diabolical Coffee. Devilishly good coffee and diabolically awesome clothing
JR Butler is the Founder and CEO of Shift Group. This is an episode filled with lessons on what it takes to commit to building yourself, your team, and your business. JR is an inspiration and I can’t wait to have him back on to dive into more of his story and the work he is doing with Shift Group.
Check out Shift Group at https://shiftgroup.io and big thanks to JR on the launch of our new partnership to help amplify what he and the Shift Group team are doing to help empower elite athletes with the tools to succeed in technology startups as growing sales leaders.
Sponsored by our friends at Veeam Software! Make sure to click here and get the latest and greatest data protection platform for everything from containers to your cloud!
Sponsored by the Shift Group - Shift Group is turning athletes into sales professionals. Is your company looking to hire driven, competitive former athletes? Shift Group not only offers a large pool of diverse sales candidates from entry level to leadership – they help early stage companies in developing their hiring strategy, interview process and build strong sales cultures that attract the best talent for early stage companies.
Sponsored by Diabolical Coffee. Devilishly good coffee and diabolically awesome clothing
Have you ever looked at LinkedIn & said “What the heck are people doing here? How can I make LinkedIn work for me?”. Troy Hipolito is someone who has asked, and can answer that question. Troy is a LinkedIn Influencer, brand specialist, and has a very diverse background that we discuss in depth during a dynamic and enjoyable conversation.
If you need to manage your LinkedIn efforts & drive appointments, or support your LinkedIn Events & even run your own revenue-generating system – then you should talk to Troy.
Want to advertise your business in a cost-effective way. It’s time to give podcast advertising a try. Research shows a high rate of podcast listeners made a purchase as a result of an ad they heard on a podcast. Visit podbean.com/brands to launch a cost effective podcast advertising campaign in minutes. That’s P-O-D-B-E-A-N.com/brands.
Welcome back, everybody. My name is Eric Wright. I’m the host of your Disco Posse podcast. Thank you for listening. Thank you for watching. If you want to watch, you can actually legitimately watch it’s over at youtube.com/discopossepodcast. Thanks to all the amazing people who are making this podcast possible and growing, growing like crazy. So super proud, having a lot of fun. Hope you’re enjoying the show as much as I am and all of our amazing guests. Speaking amazing guests, you’re about to meet Troy Hipolito. He’s the not so boring LinkedIn guy, but it’s actually a lot more than that. Troy is the founder of the Troy Agency. He’s got a really storied history in helping people with social promotion. But it’s not just about social promotion. He thinks big, and he takes that and applies it to social promotion. His agency style work and understanding of how to help people is really coming together beautifully. So it was a lot of fun. Troy actually was in the midst of a move, and he was kind enough to schedule something. This was one of those fun outreaches that he did a cold outreach to me on LinkedIn, and I actually liked it, and we got connected.
He was super fun. So I hope you enjoy this as much as I did. And talk about not so boring. Let’s head on over and remember the not so boring and fantastic people that make this podcast happen. So shout out to my sponsors, who all right, we got some announcements coming up very soon, so hang on to your hats. But in the meantime, go to vee.am/discoposse to get everything you need for your data protection needs, whether it’s on premises, whether it’s in the cloud, whether it’s bare metal. Metal, yeah. You got mail servers. You got to back those things up. You’ve got to back everything up. How about stuff like SharePoint, Microsoft Teams, Office 365? There’s much more. So again, just head on over to vee.am/discoposse, find out and let them know old Disco sent you over there. Speaking of going over there and doing it safely, protect your data in traffic, in transit, in every form. Head on over to tryexpressvpn.com/discoposse. I’m a user. I’m a fan because hey, I travel around, I move around, I’m on other people’s sketchy WiFi. It’s not sketchy because I use a VPN. So go check it out. Hey, even better than avoiding coffee shop WiFi, get your own coffee. Go to Diabolicalcoffee.com. All right, let’s get to the fun part. This is Troy Hipolito, the not so boring LinkedIn guy on the Disco Posse podcast.
Hey, this is Troy Hipolito. I’m with the Troy Agency. I’m known as the Not So Boring LinkedIn Guy. And you’re watching the Disco Posse podcast.
I loved your tagline, the Not So Boring LinkedIn Guy. And thank you, Troy, for jumping on today and for reaching out, getting connected. I’m a real fan of your content, your approach, your style, and it’s something that I even myself, I think. Good golly. There’s so many things I’m under utilizing around LinkedIn, around a lot of social network. You’ve really, really got some great stuff that you’re coaching people through and bringing them towards really strong outcomes. So for folks that are brand new to you, do not yet know about Troy Hipolito, you want to give a quick introduction and a bio and we’ll talk about what you and the team are doing.
Oh, yeah, I’ll even do one better and tell you the story behind it. So I am a designer and developer by trade, right. So I’m a programmer as well as a UI/UX person. And I was actually an award winning designer here in Atlanta, Georgia, several years in a row, like the top designer. And so back in the day, I had a company called ISO Interactive, and we were building video games. It was like the Rockstar programming. We’re doing virtual worlds, we’re doing app development, back end, front end. And it was really cool. We had a small team, about a dozen people. We paired up a designer with a programmer, and we created stuff that didn’t exist. We loved it. Right. So it was going really well until it wasn’t.
In Atlanta, Georgia, they no longer depend on the agencies because the companies that you get work are the Fortune 500. They’re very corporate. And so they use agencies up to a certain point, and they pretty much cut a lot of that work off. And the agency started fighting each other. So I was thinking, I got all this great work. I did CocaCola stuff. I did Xbox Mobile, did Harry Potter movie releases. We even had our own Harry Potter fan site that we developed a full 3D, pseudo 3D virtual world using multi-user technologies. And it was just like, why can’t we get any work? Well, the agencies grab a lot of these people and brought them in house and really cannibalize the whole agency model. And so they were really fighting over pennies. We had to find another source of getting work. And so I asked a buddy of mine, he was actually doing well, and he had a competing agency, and he was putting all his work through LinkedIn. I was like, LinkedIn, you’re getting all your work through LinkedIn? He says, yeah. And then I had a sales buddy of mine in New Jersey, and he said, yeah, it’s LinkedIn, man.
It’s LinkedIn. I thought LinkedIn was a bunch of stuff for resumes. And they said, no, you have to build a relationship and all this other stuff. And I realized something. Those relationships were like, analogous to old-fashioned dating. And again, I realized I was a terrible dater, like in real life. So I have type A personality traits because I’m very technical, right? And what I and other people were doing and what a lot of people do nowadays still is they date wrong. They go in there. It’s like me saying this beautiful woman and walking up to her saying, I find you very beautiful. I’m going to have two babies with you right now. It doesn’t work you end up getting slapped in the face. And that’s the technical equivalent of what people are doing on LinkedIn. And so we had to revamp it. It worked really well, and we had a bunch of clients, and then we fired those clients and we rebranded our agency. And people asked, Troy, why did you fire all these clients? I said, Because they weren’t the right type of client. They just wanted to sell. And so my type of clients that I hire on the higher end, the high end type of clients, we look for people that offer value like they’re human.
So if you reach out to them, they’re there to help that person, they’re there to engage, and their audience exists in an active forum on LinkedIn. And so that’s a very narrow band of people that are authentic. They’re willing to kind of contribute some time to help those individuals. I said, yeah, I need to find like-minded people. And that’s when we changed from return client to the Troy Agency. So we only pick up maybe one or two primary clients a month, and it’s residual, works out fine. On the other end, we have course materials, and we have our own show, a monthly show that covers that type of revenue stream as well. So it works great as long as you have something that someone wants and you’re there to help them, don’t sell. If you help them solve their problem, there’s really only one of three things can happen. So I’ll take a 15 minutes meeting. They said, Troy, I’m doing this, and this. I’m having this issue. I help them solve the problem on LinkedIn. I said, this is the thing that you need to do to solve that immediate issue. And there’s one of three things that come out of that.
You put out good energy in the universe. They’ll never talk bad about you. Number two, it works so well that they’re into their business and they realize there’s 23 other things that only Troy can fix, and they hire me. And the third is they’re so happy they can’t afford what I have going on. But they like me. They like me enough to send a recommendation. And being recommended by someone else is ten times easier than you tooting your own horn. So it’s all about being human and doing what you say and helping those people get where they need to go, that’s my story. Little long version anyway.
No, it’s perfect. And a lot of folks that are listening to us obviously have a LinkedIn profile. I say obviously. Many folks would have a LinkedIn profile and they use it for a variety of purposes. And look, my dms are littered with these people that just don’t get it. I sort of say this is the common interaction is, hey, I see we have some common interests and like, all right, I’ll bite – accept, right. Because I also use it as a broadcast channel. Right. So I’m ultimately, all my content is going pushing to LinkedIn. I’m not really using it interactively as much as some people would think. And then the next one is, hey, thanks for connecting. Really great. Like what you’re doing with X or interested to connect and chat more. And then 4 hours later is hey, so what do you do about blah, blah, blah. And they immediately are pitching a product to me. And then the next day it’s like bumping the top of inbox just in case you didn’t see this then it’s not sure if you’re getting my messages. And then eventually like seven messages later you get the hey, I know you’re probably busy or you’ve been eaten by a bear or like there’s some kind of witty thing that they read worked once and so they just reused the same meme. And I’m like, no, this is not the way to use this platform.
You know what that’s called? It’s spam. They’re spamming, that’s what it is. I had to release a client because he wanted to spam people. She says, I always want to help people that need help right now and send this one message to everyone and keep on sending it to them. I said spam. Why is spam? I said, that’s the definition of spam. I was telling me that is what spam is. You want to communicate. And so that communication element is important. So what you’re talking about is seven or eight touch points that people think. They’re thinking, well, I have to get between 12 and 14 touch points before they connect with me. But they’re not connecting the dots. So that doesn’t mean people on sending them messages on your LinkedIn dm, it means how can you connect with them in a more authentic way? It’s okay to send one or two messages, I think. But I don’t like the selling portion. I do like the idea of getting to know that person for a particular reason. And so you want to do things with strategy. So a lot of people will use these systems and they’ll just bombard it and automate it and that sort of thing.
And LinkedIn, they’ll crack down on it, you get enough complaints, shut your account down. And so you have to have good habits. One of the things is like how can I come across authentic? The other thing is that how can I have them come to me? How do I separate myself from every other LinkedIn guy out there or in your business as well. Whatever you do, how do you separate yourself where if there is interest, they acknowledge that and they come to you. So you want two way traffic. And one thing that I do, what I don’t do is I don’t do sequencing on LinkedIn. I will have a witty connection message, and I’ll have maybe one follow up. But the follow up is usually a welcome message, and it’s unique to that individual. Right. I have a daily process, so when I pick on a client, I help them with the profile top to bottom, help them with targeting, help them with their initial messaging, and I help them with the day to day process. And that day to day process is really what’s going to keep you sane. Like, oh, I can be on LinkedIn 12 hours a day. You don’t want to do that. That’s insane. You want to spend between 15 minutes and 1 hour a day to do whatever the things that you need and get out because you have a business to run. And someone says, well, how can I get people to actually book a meeting with me? I said, that’s easy. I can easily get between 30 and 50 meetings a week if I wanted to. I don’t know. I think my camera is getting a little blurry. I don’t know what’s going on here. I think it’s the lighting.
Yeah. It’s the joy for folks that don’t understand. Poor Troy just moved, and we’ve made them do podcasts in the middle of a move.
I just moved in. It was like 80% of my stuff got wires and stuff in there. So it’s like the living room of the stuff.
There you go. That was funny. As soon as you move back in, it refocused.
Yeah. So if you get a process down. I said, well, give me a tip, right? I said, okay, how are you authentic? You’re authentic by understanding who you’re speaking to and creating some bit of information about them specifically. It’s not selling. So when you connect with someone instead of spamming them, why don’t you just use your LinkedIn app and open it up to the video option and you can send a native video to them. That’s what, 20 seconds long, maybe 30 at the most, and just thank them for connecting. Thanks, Eric. I really appreciate the connection. And I noticed that you have an interesting podcast called DiscoPosse Podcast, kind of tongue tied there, and I’d love to learn more about it. I said, if you have a moment, just take a look at my profile. I said, if you see any dots to connect, feel free to send me your booking link. I said, I’ll schedule some time with you. Thank you very much. Have a great day. That does a few things. That’s a unique message. You took the time to address them and what they do. You were not selling. And it’s appropriate time for them to look at your profile.
And if they see anything they want to talk about, the onus is on them. Send you the booking link and you’ll schedule with them. So it’s not me, me, it’s you. And so that concept and smiling and of course I didn’t smile. I did it quite quickly. But that idea is very powerful. You are communicating with them as a human would. And that’s just one of many of the tips and tricks. And I think the other thing we were mentioning was all the touch points. Well, there’s all these different things you can do depending on your strategy. Why are you connecting with people, you know? Are you connecting with them to engage with their network? Are you connecting them to sell them something, which is probably not a good thing. What do you have to offer them? How can you help that individual? You have to get down to the human level. So people think, well, I think I’m going to do this thing for their company. I’m going to do it for the team. That person doesn’t care. I mean, they may care, but they don’t really care. They care about themselves. We’re human.
So deep down inside, you have to figure out how can I help that individual? What does he want? Does he want to be the hero? Does he have a problem he needs to fix? Does he get something off his chest? Can I pass the litmus test? And the litmus test is – you know the old fashioned litmus test, when you dip it in there and you figure out if it’s a certain chemical or whatever, if you passes the test, the acidic thing. The litmus test for LinkedIn is – if this guy would go out and have a beer with me or a drink at a high end bar, because you have to think during covid time, your time is valuable. I’m not going to go off some stranger and have a drink with him because he could be creep. And I’m telling him all my secrets and stuff. So if they feel they could have a drink at a high end bar with you, you pass the litmus test, you pass the friend test. And that’s really where you want to be at. Maybe instead of just sending connection requests, you could take a look at five people a week and see, I want to engage with these five people because of their profile, the type of person they are, their network, whatever the case may be.
And I want to see what they’re posting. So engage with their post before ever sending a connection invite. If you engage with one or two or three of their posts and they respond, the chances of them of accepting the invite goes from there 30% to 90% and it goes all the way to 90%. You’ve not just done that one thing. The second thing that you accomplished is you move the relationship down the line. Your ask has to be appropriate to the relationship. Anyway. I blab a lot, but I think you get what I’m saying. Eric.
That’s a pretty one. We’re here because of your method, right. You took the right approach. I get dozens of inmails a day and people who are like, give me that. I’m like, I get it. You read Jeb Blunt, you want to get to 15 touches fast, right? So you think this spamming out my inbox is getting you to the 15 touches. But that’s not the case. And I get often and get outreach for people. They’re like, hey, we’d love to be on your podcast and like, thanks, booked up. But when you reached out, I did do exactly that, right. I looked at your profile, looked at what you’re doing. I’m like, yeah, here’s my booking link. Right. And here we are. So the proof is in the number of times I’ve said no to people. The one thing I always joke about too, is like, I want to make an explainer video of how not to sell people explainer videos on LinkedIn. Because I swear to goodness, about eight a day, people are like, hey, explainer videos are a great way to do whatever the first thing they do is. They’re like, here’s my calendar link to book your meeting, to set up your explainer video pitch session. Like, Nope, this isn’t going to go well for you at all. But welcome to my broadcast network, right. So for me, I’m like, hey, it’s another audience member. Good luck receiving my feed. But the real genuine connections where I could do, like you said, actually reach out and ask for time and meaningfully give back to them where they will care enough to take that time and give me that time. It’s a beautiful, like, it’s a bi-directional relationship of giving time and effort and attention because this is the real big thing. Right. We’re in the attention economy. And how do you get access to that attention?
Yeah, LinkedIn is so different than anything else. Here you have to come from a place of service. You got people that have, like, these Instagram models and what they call the thirst traps and all that. So that’s a different thing. Linkedin is really geared towards career change or building relationship building, working from home, B2B businesses or high value services. So these cheap off one methods that don’t work well, maybe they work well for a widget, right? We’re not selling widget here. We’re selling conversions to business. I have a client right now. One job that he gets is worth $200,000 per job. He’s trying to get one a month. Right. And not every method will work on his audience. And we may have a method that works perfect for me and awful for him. And it’s our job to figure out, well, where does this thing break apart? And then how can we bring it back where it will convert for them. Or we have to cover those dots to figure out how much is this client willing to do. A lot of these higher end people, high up individuals can’t do a lot of things.
They do certain things well. And if it’s outside the scope and not able to do, how do we cover those things? How do we simplify that process where we can cover those areas? And he can still be that person that can communicate. So it really depends on the strategy and what you’re trying to do on LinkedIn. But LinkedIn is known for a lot of that high-end B2B conversions. For example, I don’t really make a lot of money per client, but I’ll gain between one and two new clients a month, right. They’ll pay something like $3,000 or $4,000 upfront and then $1,100 per month. Right. You think over the course of a year that’s pretty good money because you’re compounding all the previous clients and they’re adding services. So that $1,100 a month could be $3,300 a month and so on. And if you got 20 clients at two grand, you’re making 40 grand a month on it and then adding to it. The trick is to slow down in order to speed up. So it’s not about rushing, it’s about just doing those things right. Another thing, too, is we have our courseware, and I couldn’t have done it without partners.
So partnerships, networking to build really solid partnerships is a really strength of LinkedIn. If it wasn’t for my partners, I wouldn’t have my courses. I wouldn’t have kept the Troy Show. I have a LinkedIn event called the Troy Show once a month, and I don’t want to do it all myself. It’s too much work. So we want to figure out these partners that have ancillary skill sets that will really possibly impact your business. And I even tricked my partner. His name is John Michelle. He’s another LinkedIn guy, a really good guy. And I said, you know what? I said, John Michelle loves to do these profile things, right? I said, Let me get him on a meeting. And so this is an example of a way that I tricked him, but it was beneficial for him. He got three clients out of it, right? So I know he’s going to be I’m a give. I’m a giver, right. I’m going to give him clients. But I said, hey, John Michelle. Hey, Troy. How are you doing? I said, pretty good. I’m redoing my profile. I was wondering if you can jump on a meeting with me, help me out.
He said, well, you’re a LinkedIn expert. Why would you want another expert? I said, well, because there’s crossover and there’s a percentage of stuff you do differently than I do. We have different flavors. I’m more branding, and he’s more SEO. And he’s in a certain type of details versus what I am. So we had a video. It’s 45 minutes. And I was challenging him on certain areas, and it made a good banter back and forth about why certain things. And I even disagreed on just a few blow points just to make it interesting. And he says, well, that was a pretty good video. And I chopped it up into seven pieces that may have a whole series of videos to show on LinkedIn for posting. And then I took those seven videos and I put them together on a LinkedIn article. Then I have an Evergreen article that reaches out to it. And he got three clients out of it. He said, thank you. Why did you give me these clients? I said, well, I mean, you helped out with the profile. He said, not really. I said, Well, yeah, you did. It was entertaining. It was good for my audience.
I said, but your audience is now hiring me to do these profile things. And he charges several thousand dollars, whatever it is, just to do the profile part. And I said, oh, that’s fine. Just keep the clients, you know. I guess. Well what do you want? I said, you know what? You think this would be a good series, maybe a course or something? He says, yeah, this make a great course. That was my goal the whole time, right? So he did the whole course, and then I did the series of courses. Now we have hundreds of videos and courseware now. And then we got people that have a large audience. Now, when I reach out to LinkedIn, other LinkedIn influencers and things like that, they have a large audience. And I said, let’s give them 25%. Let’s have them sell the course, and then they can get 25% and we can split it between the other partners and stuff like that. He says, well, are you okay for only getting a portion of it? I said, sure. Well, my method is if there’s not enough pies, you know the slices, they slice the pie up and you’re slicing it so thin you’re not making money.
I said, well, my idea is just make more pies.
It’s such a good way. The one thing that people are often too short-sighted about this stuff is they just immediately think like I can just hammer up this course and then I can sell it, and then I get 100% of the revenue and there’s literally dozens of ads that people will get a day. Once you click on one, you’re now in a loop of people selling this card and that card.
Oh, yeah, you’re going in a rabbit hole.
But if they don’t do what you did, which is open up the door and give the opportunity to collaborate. And collaboration is bi-directional. Sure, you saw that it would have been great to be able to create courseware with these folks. But in the end, you did it in giving back. You gave before you got.
Yeah, he was already in it before he knew it. And so I don’t think that’s mischievous, but because regardless he was going to get clients and he wanted to do the courses. And he has a certain experience, and I may have a certain audience, it just makes sense. And then we have an email person that comes in to run some of these shows. And so we convert on that, and we bring clients through it. And now we’ve attracted people that have large audiences, and we’ll give them a portion of it. As long as their network is right, everyone makes money. So it’s not a me, me thing. It’s how can we help each other in a way that everyone benefits. And that’s one thing that a lot of these solopreneurs are missing. They’re just like, I can do everything. Well, I’m a programmer, I’m a software engineer, and I’m a UI/UX person. I’m an award winning designer. I can do a lot of stuff well, but I’m a little older now, and I only have like 45-50 hours a week. I’m not doing anything more than that. And so the designer that designs 50 hours a week, and that’s all he does. Maybe he should do those things. We should distribute it out where we want. Because if we do everything ourselves, there’s no growth opportunity.
Because you’re wearing so many hats and you’re not able to go beyond a certain area. And so that’s where someone’s business processes and actually relationships come in handy.
There’s a great quote that I got from a book, and so I’m going to look it up right now just because I don’t want to miss quote, I want to call the title out because it was one that I really enjoyed, and it was called Twelve Months to 1 million. Ryan Daniel Moran, really fantastic book. But one thing that today says, it’s not a business if you walk away from it and it falls apart. You have to really build a machine around it because it’s easy for especially, we are as creative people as a designer, like, you know, maybe you could make $50,000 off a single client for a six week batch of work. But if three weeks into that batch of work, you have to leave, then you aren’t going to get half the $50,000. You’re going to get zero of the $50,000 and you lose your reputation. So what you do, you wrap a team around it so that you can contribute to it and share in that wealth and also get the benefit that you’re creating future opportunities, because now you can scale versus if you just be Troy Hipalito solopreneur for the rest of your life, something happens where you got to take care of your family, you got to move, you got to do stuff, and all of a sudden what do you do?
You just tell your client story. Work is stopping for the next four weeks because I got stuff to take care of.
Yeah. You definitely want to minimize upsetting your ongoing cash flow. I mean, that’s what’s going to make or break you. All these other things. You can make more money. Like I may make more money in the courseware, but not right now. It was an investment. It’s an investment. It’s building relationships. And on the tail end, you’ll end up making a good chunk of change. So I actually have an article that talks about documenting and creating your SOPs – your Service Offering Procedures. It’s not really a LinkedIn thing, but it’s more of a business thing. And so by having these service offering procedures, you’re actually teaching certain areas of your business so you can hire out. And the truth is, everyone says if they’re perfectionist, you are in the worst boat because you can’t screw yourself up. The person who’s doing his task. You say, it’s true, I can do the job with seven people, but I have to hire one person for one job. And I’ll give you a perfect example. Back in the day, I was the creative director of a company, and it was tied to another company. And they wanted me to engage the engineers and other web people on how to do a project. They’re doing government stuff, and I was doing civilian other stuff. Right?
And they had to create a website for this, this and this. They wanted me to engage with them. And they said, oh, yeah, this is a six month project, seven people. It’s a six month no. How long would it take you to do it? I said, it took me three weeks to do the whole thing. I was just being on. I was naive because I was a designer programmer and I knew all the bits of it. And they said, okay, you do it then. And that was done in two weeks. They never spoke to me again. I screwed up the relationship because they have different processes and stuff. And you have to be kind of careful about because you might be able to get that one thing done. But these longer relationships you can ruin if you don’t have a way to create this service operating procedure, to hire out in order to do certain tasks. And even if they do a task and they’re not 100% as good as you are, do they need to be, you think? Do they need to be exactly like me? I mean, what is really good? Like really good is better than most people.
Look at a program module, someone says, oh, we have to create this one component where it’s reusable. And I said, well, would you reuse it on another project? We probably could. I said, but you’re not. And you have to understand that the client is paying X amount of dollars and you might want to create this reusable component that eats up the entire budget and it makes no difference. So they have to think intelligently. How can I create these service operating procedures so people are taking certain tasks on that they’re good or good enough. And when I mean good enough, I mean very good, but maybe not exactly to what you’re used to doing, because we all are a little perfectionist in our own way.
Yeah. One of my funniest examples of this was like, I was like, 19, and I was building houses. I was working as a landscaper, and we would build houses during the fall when it would be lower in the landscape side. And I worked with this roofing crew, and it was like, such a funny thing that this is their full time gig. And they were run and gun contractors. They knew what they were doing. They come in, they got three days to do a thing. They’re going to stand it up, and they’re working on this house. And it was a friend of mine’s house. So I’m kind of, like, acting a little different because I know the guy that owns the house. And this guy’s hammering in a nail, and it goes in crooked. And then you see him, he’s, like, trying to back out the nail. And it was so funny that the guy’s name was Lumpy. It was his nickname. He said, Jesus Christ, Lumpy, we’re not building an F in piano. Just hammer it in. And it was so funny. I’m like, my instinct would be like, yes, do it right, spend the extra time email.
The other guy is just like, whack. He just hammers it in. It bends it in good enough so that it’s flush. And he’s like, then put another nail right beside it. And the difference of like, look, we just got to get this done. And like you said, it’s weird that we use phrases like good enough or whatever. Like, good enough is good enough. It’s good. It’s not barely good enough. It’s good enough. Most people don’t even do good enough. So it’s like this unfortunate scale that we, and you hear the phrase too, like, if you aren’t embarrassed about your minimum viable product, you waited way too long to put it out.
Yeah, my IT company, I had a lot of people saying, oh, I need to scale it to this. And I just had to tell them the truth. I said, look, you guys spend about $150,000 on this MVP, and once you get funding, you’re just going to rebuild it. Why would you rebuild it? I said, trust me, because investors going to come in because I went through investment many times. So I already know, like the process. They’re going to come in and say, oh, this is great, but our market that I want to hit is this or this is a cool feature and you can’t fit it in afterwards. A lot of times, especially, you have to get stuff done in a very small amount of time. So some people create MVP to take care of the functionality of a certain group of people or a maximum X amount of people. If you get beyond that, sometimes it’s okay to just take that idea and rebuild it, because sometimes the concepts and ideas are half to work. So you really have to think along what is realistic, what is good. When I say good enough, everything that we put out is very good.
But I have certain people that like my writing style. I look at the person and I figure out their personality and I write according to their voice. And another writer may not get that. So I have to figure out everything about the person. So I understand the vibe. And sometimes they don’t like telling me certain things and I drag it out of them. It’s like, okay, how did you grow up? What do you like I said, okay, are you gay or straight? Like, I’m blunt about I need to understand where you’re coming, what’s your audience, what’s your typical kind of client? And I blend that in. I said, okay, I think I got your voice. And I write it down like, wow, this is pretty good. And they make their tweaks to it because when someone looks at your LinkedIn profile, they’re looking at a person, they’re looking at the story. And the reason why we call these reality TV shows are so popular, it’s because it drives the story. I was living in my car and now I make a million dollars. So they want to know that story. How did you start from here and get over there and be successful. Especially in the states, they love a success story. They love the underdog, and they want to relate to you. That’s one reason I work with a lot of clients that have families. They’re family oriented. I understand that they have a bigger care. I work with people that maybe have a similar background because I understand what they’re going through. I have people that try to be sincere. At the end of the day, this is kind of where you’re going. And I’m bluntly honest with my clients. I tell them, okay, I’m going to do this. When you get your first client, I’m charging you more money. I’ll tell them, and we’ll make this thing work. And I think that personal relationship and engagement not just makes him feel good, it makes me feel comfortable and happy about helping other individuals.
The sincerity piece is always an interesting thing because I’ve had people say this. I can help somebody by writing content with them in a sincere first person voice. I can represent their personality. And like, you’re so fantastic at this, right? And then someone would say, like, well, is it really sincere if you’re getting someone else to write it for you? No, but that’s not the point. The point is they don’t have time to create this content. They created, they read it and they’re like, hey, this sounds like I wrote it like, bingo. Yeah.
They may not be good writers. They’re like coaches for this. Coaches by coach. Coaches hire coaches. That’s kind of what I am, and I’m not doing everything for them. Doing the first draft, I feel this is what you’re talking about. So if you’re a good person that does websites, you may be a terrible copywriter. If you’re a good 3D guy, you may be a terrible UI guy. If you’re a good coach that helps women, maybe you’re not that good at helping guys. I don’t know, making stuff up. So everyone has their strengths, but they have this passion inside to do something. And it’s our job to present that passion in a way that makes sense. Like a LinkedIn profile is really about 70% visual. But once you get past the visual, they start digging into the story. That story is the bit that will convert them. So the visuals will bring you in and the story will help convert. Of course, you have your LinkedIn SEO optimization and all those tricks too, but you have to have that balance where they said, you know what, this is someone I want to talk to, and that’s where you want to be on LinkedIn.
And it’s a mixture of all of those things, right? Like you can have great SEO, but then they get there and they go, okay, it was easy to find, which ultimately SEO is about searchability discoverability. But if I have great SEO for a restaurant, but the food’s trash, that’s no good. You can get people there. And then your role is to teach them how to keep people there and engage them and give that sincerity. Tell that story.
People can’t do it. That’s kind of funny. People say, I just want to sell stuff. Well, if you don’t want to put your human out there, maybe it’s not for you to convert in that way. Maybe you’re a high end CEO that uses it for PR purposes, that’s fine. But if you are converting, if you’re trying to get a career going on stuff, you need to have all your ducks in a row. If you’re trying to convert B2B or high value services, you have to have all these things in a row. Because when someone makes a decision, it’s usually an emotional decision first. And second, it’s based on stats. That’s how most humans work, right? And they look at you and you look like a douchebag on your photo. They’re not going to know it. But in the back of their mind, something is off with this guy here. I don’t think I want to work with them. You don’t know why, it’s your douchebag photo.
Something simple as that. So making a decision to work with you, they may have 2, 3, 4, 5, 10 criteria, right? Whatever it is. And they don’t know it’s ten or five criteria. Say five is easy number. But all they have to figure out is one that you’re not qualified to not work with, you know. Like, how do I separate myself from all these other LinkedIn guys? Right. Well, I’m not as serious. I’m more human. That’s why I put the not so boring LinkedIn guy. It’s just funny enough to separate. It’s not really super funny and super off. My other line was actually better, but it didn’t apply to LinkedIn. When I had my gaming company, I was known as the number one Swissipino game designer in the world. Right. Because my mother from Switzerland, my dad is Filipino, I’m half Asian. And so my mother has blonde hair, green eyes, and my dad’s like, really Filipino and so I’m Swissipino. And that would be such a great pickup line of the bars. They would say, really? I think so. I probably number one Swissipino.
The irony is this, Troy, that you’re the second Swissipino person I know. I have a friend, somebody who’s Sonia Missio. She’s actually based in Toronto, and she also in that interesting split. But it is so funny that you say that. And like you said, that the genuineness comes out. And look, the truth is, design is important. User experiences, that engagement is important. If design didn’t matter, then there would be sushi milkshakes.
We like the fact that someone spent way too much time making it look good so you could eat it. Otherwise we would just be having nothing but Soylent milkshakes. And, like, there’s a reason we do stuff. You walk down the street, there’s flowers on the thing. Like, you see somebody’s profile, and it’s like half of their girlfriend or boyfriend’s face is in the shots. It looks like they’re on a fishing boat. That’s great photos.
That’s another thing I tell my clients. Oh, my goodness. Well, I don’t know. Do you have time to make money? I tell them I’m blunt with them. What’s going to cost me so much? I said, how much is the client worth? That’s my closer right there. I said, how much is a client worth to you? Okay. Then you’re going to have to do A, B and C or pay to do whatever. Because it’s like you want to be honest and you want to be authentic. But there’s also a fine line from kissing someone’s feet. The client doesn’t want that. Client wants to know that, hey, Eric knows what he’s doing. Troy knows what he’s doing. If he tells me something, it’s for a reason. It’s not because he’s blabbing. It’s because he’s trying to get me money. And those are the right people. Well, for my market anyway. Those are the right people to actually engage with because they’ll actually take the steps to do a process that works for them.
Yeah. There’s a really interesting thing you talked before about the kind of like firing your client. And it’s an important piece because as you look at where you can deliver real value. Right. And you’re selling value, you’re selling a specific outcome. And I’ve had this for an advisory with startups. And you start talking with them, and as you give them advice and you give them direction and you give them guidance, and they’re just, like going the opposite way on each thing. And then they say, I don’t understand why this stuff is not working. Well, I don’t know, maybe because the last three things I’ve told you that you should do, you’ve kind of gone in the opposite direction. And then at that point. I’m like..
Well, you’re nicer than I am. Yeah.
It feels like I don’t think I’m adding value to this. So I’m going to just step back.
Yeah. I had two clients I remember firing, and there’s a very specific story. One was, I have CPA. Anyone that has a high value of service I could potentially work with. Right. If they’re trying to convert on LinkedIn. One was a CPA, and he was from, I don’t know, the UK somewhere. We moved to Midwest. Older guy in Balding, and he was there. He was very dry. Right. And he used to take Zoom meetings like this. It pissed me off. Right. Like what? He wouldn’t even looked at the camera. He’s talking and he has his accent and all this other stuff. He says, Troy, this is not working very well. And I looked at him with a straight face. I said, didn’t you just get 14 clients in 45 days? How did you know that? I was like, I bet everything I do, I’m a lot smarter than, I don’t tell them that, but I’m a lot smarter than I look. Okay. Because I said, I talked to your VP two days ago before this meeting. He was trying to not pay and get these clients. Right. I don’t like that. That’s being very dishonest. He just wanted to do what he wanted to do.
Right. And I said, you know what? I’ll let you out of contract. Forget about 30 days. Maybe it’s not working for you. And he said, yeah, maybe it’s not working. Oh, it was working for him, but I don’t want to work with people that are trying to lowball me or lie to me. I had another guy, he was in cyber security. It’s another big area. And he was doing training, certification stuff right there’s. All these.
And he wanted to sell the certification to individual LinkedIn. I didn’t think it was a good idea. Right. I don’t know about cyber security. But I was like, yeah, I don’t think this is, is your audience receptive to this? Yes, it is. Yeah, I don’t think so. It’s kind of hard to sell these $4-5,000 courses and stuff. And I said, you got funding for it. And then I said, you know what? You might want to just partner with other security people and use this because you’re an ancillary, you’re an extra. And they already have the in on it. In on this company that’s doing this stuff. And they’d probably need his certifications anyway. And he said, well, I don’t have any partners give me two days. So I went to a security event here in Atlanta, Atlanta, Georgia. And I paid my bills to get in, $500 to get in and was talking to these people and I talked to twelve people. I would love to talk to this person. I said, hey, I said forget this whole what we’re doing, just forget it. I’ll give you meetings. I said these clients are worth a lot. I said, this one client here don’t miss the meeting. And he’s traveling and all this stuff. He agreed to the meeting, he missed the meeting twice, right? Twice.
Yeah. And the other people who were not, I don’t know what he was doing. Some people do their business, shoot by the hip. He was going and he was from Texas and he was going to another country and I was having meetings with them and I told him directly, I said, hey man, I like you, but I don’t want to see what’s happening in their background because he was at his mistress house or something and that’s not cool. I don’t want to know that personally. I don’t care if you have two women or you’re married, you’re single, you’re gay, you’re straight. I think as long as you treat people well, that’s important. But what I have a personal issue with is deception because that means you’re not going to run an honest business, right? So I had to let them go. I like the guy. But if you can’t make the meetings and you’re in these compromising things and stuff and you’re trying to cover the campaign, don’t do that. So you have to work with people that have the same, I wouldn’t say moral structure, but integrity, right. Integrity, that’s a good word to have the same kind of ideals that you do.
Because you know that at the end of the day, if he’s going to do stuff right, I know that I won’t get paid. I’m not going to fight over payment. I would just can you and stop all your services and you won’t make any money. It’s really simple for me. You can’t manipulate me. I’m here to help you to convert. And so you need those individuals that say, you know what, I will make it to this meetin., I will go in here and help this individual do what they need to do and I’m going to make business. You have to have a very clear head on. Like how am I going to get to point A to point B and then know that next month you may have to jump from A to C. You have to figure out the connecting the dots, you have to do some AB testing on what works and then you have to figure out like this works better. And it’s okay because you didn’t know that before. It’s a process. So people think that, oh, I get this automation thing on LinkedIn, I’ll make a million dollars. No, it doesn’t work that way.
It works against you. Linkedin will shut you down. And if that’s the main channel, it’s not going to help you out. So a lot of the lower end and not lower end is money so much, but lower end and thought process and being human and helping, they don’t do very well on LinkedIn, where a lot of coaches that have a little bit of a brand, a little bit of flair, something that separates them from other people, you got people that like them, actually like them, they can engage with them. And every personality works well. Had this one guy really dry personality. I told him, you are dry as toast. I told him, you’re dry as toast. I said, that’s your brand.
I said, yes, you are. I’m telling you are. I said, you know why you could say dry jokes. And it’s funny because you’re such a straight face. It works for you. And I said, and you’re a CPA. Do they want a funny guy to be messing with their money? No, they want a serious dude. And you have to kind of think about it like that. You have to think about what is my personality. And so I actually am somewhat dry. I’m kind of funny. I got dry humor. That’s what it is, right? Not so boring. Linkedin. I’m kind of boring. So I twisted it upside down to do that. And I would love to be the number one Swissipino LinkedIn guy in the world, but it wouldn’t make sense. LinkedIn, they wouldn’t know. It doesn’t. Because when you’re doing gaming, it’s a little more fun. And they’re going to ask, what is Swissipino? But on LinkedIn, they’ll be like, this makes no sense at all. So you have to apply a brand that kind of makes sense to that audience.
And it goes to your approach to it. Right. Which is about adaptability, because even where a method may work for one company, one brand, one person, that same thing. If you just automate it and try and sell it to ten other clients without gating, is this appropriate without evaluating? Is this going to fit their persona, their audience? It’s both sides of that experience, too. It’s not just about you. Two funny people are not two funny people. There are two funny people that each have individual audiences. The one dry CPA guy, like you said, your clients are going to dig this. They want to kind of know that you’re the dry CPA guy. Somebody who’s hiring a real funny person if they want them for a keynote speaker for a CPA conference. Perfect. But if you want, it’s like matching and mapping skills to value, to perception, it is a real like, you achieve a really interesting mix by being dynamic, having the integrity, being genuine through the process. And then making sure that those people then parlay that genuineness, that integrity because of how you work with them.
Yeah. And part of it is clarity. When you’re creating a brand, you don’t want to say, oh, I can do this. I don’t really talk about all my development other than in the story. But in general, when you look at my profile, it’s very clear that he’s a LinkedIn guy. He’d get me clients. It’s very simple concept. But if you say, oh, by the way, I can do website design. I did Coca Cola stuff. What are you, a LinkedIn guy or a programmer? You end up looking like a flea market, and that’s one thing you have to avoid. You want simple clarity. You can add a little humor in it. For branding purposes, you want a separation, but what are you known for? I picked up a client last week, and he says, you know, I want to help professional women, right? They’re owners of businesses or they’re higher up in the thing and they feel like something’s missing. I said, I totally get it, okay? I can help men, too. I said, no, men will come in as ancillary. What do you mean? I said, you can’t say, oh, I helped a lot of women, but men can come in too. Well, no. You want to concentrate on that. Your main nuts or your main fruit, low hanging fruit. And by doing that and doing it well, your interaction with them, they’ll give you another client. You have your clients to come based on referral. I don’t care what kind of system you have going on. We got systems where we have direct message campaigns and stuff, but they’re not sequenced. They’re teaching the client how to reach to certain audiences. We have posting campaigns and stuff like that that we have a whole series of things that are done that promotes authentic conversations. And so a lot of things that we do, we have to slow down, have less but better conversations. By doing that, you convert. How many clients you really freaking need.
Right. Yeah. And the thing that you hit on there is like that clarity and crispness. Like, even when we talk about going to public speaking, I coach people in this all the time. When you go to give a keynote, your opening slide should not be, Hi, my name is Eric Wright. I’m a product marketer. I work for a company, and prior to this, I did 20 years working in financial services. I was a systems administrator. Started off as desktop support. Made my way to me. Prior to that, I was actually a landscaper.
Or you could start with that and say, Just kidding and move on. Right?
But it’s like that’s the first thing they do is they do that, and then they end the presentation with a thank you slide. You’re like, no, what you should do is how many times have you gone into the office and realized that there’s no door by the bathroom? That’s two way door.
And you immediately get into this thing. And that’s what your profile has to tell a story. But you’ve got 160 characters to do it in. So you just can’t dilly dally around. You got to get to it and it’s got to be meaningful, engaging. And like you said, it’s got to match the other stuff. But it’s hard as the person, the self, to have the humility to step outside and create that. That’s why having you come in and do this with them, it’s like such a boost, because it is balanced voice.
Because you have character limitations. You have SEO on Google as well as SEO on LinkedIn. So Google has searched everything on LinkedIn, and LinkedIn has their own search as well. And LinkedIn tends to do things a certain way, so you have to do things a certain way. For example, you’re on individual jobs, right. Linkedin tends to pair you with people that are similar to you. Right? Well, that’s not what you want to do if you’re doing B2B sales or your coach.
That’s right. It’s trying to find you a job, not a client.
Oh, I need another programmer. Like, I know a Zillion program. You know what I mean? You’re trying to get business, right? So one trick is to actually put your target market in your title. It’ll start pairing you up with your target market. And people don’t think about that. You know, one thing to do is when I say I’m a Not So Boring LinkedIn guy, right. That’s the first thing I have underneath my name. And it’s not SEO optimized, but I don’t care. It’s more important to have that brand. And then I have the other things that are very searchable. And then when you’re telling a story, this is an easy way to explain it. I want to show the scars, but I don’t want to show the wounds. Right? You can over inundate like you can say, yeah, I was homeless. My mom died. My brother died. He had an overdose. My girlfriend was cheating on me and left me. I was living in the shit. No one can hear that. That’s just horrible. That’s just too much. I mean, you don’t want to say my life is awful, but I’m trying to make it.
That doesn’t work. So showing the scars and then not the wound, that would be showing the wound.
Showing the scars could be like the dating story. I told you I was an awful dater. It’s funny and it’s true. I am so direct. I used to go straight for it and it works sometimes, but most of the time it didn’t. So taking the approach of old fashioned dating into business just to get to know someone, just to see, I think dots connect. Are you in the same area? You have some commonalities? Is there something that you think he needs that you can help that has maybe nothing to do with your business? Maybe it’s someone I can connect them with or, oh, he doesn’t need a LinkedIn guy. He needs to fix his freaking email. I got an email guy. And people say, oh, I got great deliverability. No, you don’t. People don’t realize that a good portion of emails never make it. And I could tell them, look, LinkedIn is great, but LinkedIn is not everything. Like, we pull stuff off of LinkedIn and create a video funnel series through like dub or some kind of component that makes it more interactive because some people don’t reply on LinkedIn. So what are you going to do? You have to figure out what works best to help convert the goals of that client and a lot of it is technology based. And can you imagine sending a proposal to someone and they don’t get it? And the client says, well, I never got it. Well, the clients not thinking, oh, it’s a mysterious email. No, it’s a you problem.
You screwed up and you lost the deal. So people sometimes don’t know how important these little components are to fix because it’s a cassette of dominoes. You remove one or two dominoes, it doesn’t complete. And I think a lot of people are so geared about volume. I mean, if you do a high value services, I’m good with one client a month. One, there’s a lot of work for me, maybe two maximum. A high value clients worth at least $1,000 a month compound monthly. You can compound that. My other client, like I mentioned, one job is $200,000. When you take the work in, can you deliver the work? And then maybe you can grow your business and your service offering procedures and training, and you can slowly grow out in that way. But I think that everyone, not everyone, but many people are about that volume and that volume will work against you. Can you imagine reaching out someone’s interested and they reply back and you don’t have time?
If they all come back and say, yes, if you’re not ready for that and it doesn’t have to be many, it can just be, like you said, one or two of them. They say, yeah, go for it. And you’re like, oh but I can’t go for it now.
Yeah, stabbing yourself in the foot. So you have to realize what is appropriate. And it’s okay to have a small business. It’s even okay to have a job if you’re doing career changes. I got a buddy that’s a sales guy for servers. I don’t even know what he does. Right. I’ll be honest with you drinking buddy. We go out, we talk. I said that dude makes a quarter of a million dollars a year having a job. So it’s not all about entrepreneurship. It’s about his ability to build relationships with clients. And whether you’re entrepreneur or having a job, you have to charge what you’re worth and you have to deliver what you say.
Put that on the card. There you go. Well, Troy, this has been fantastic and I tell you that’s a great way to wrap because it is important, right? Whether you’re selling yourself into a job where they’re selling yourself into a service, whether you’re selling a team, whatever it is, there’s the way you do it to bring that personality, that integrity through, I’m glad genuineness that you bring to this is enlightening and it was really great to share this. So for folks, if they do want to reach out to you, they can find you on LinkedIn, I presume.
My first and last name Troy last name is Hipolito. H-I-P-O-L-I-T-O. There is another Troy Hipolito out there, that’s actually my brother but he’s in the army so that’s a whole different guy. I used to be an army. Anyway, long story but I’m the most popular Troy Hippolito out there, right?
Not only is the top Swissipino but he is the top Troy Hipolito.
In the world, yeah.
Well, there you go. Troy, thank you very much. This has been really great and encouraged folks do reach out and taken your content through the great I love the way you approach things and yeah, we all need a little bit more Troy in our lives so thanks for taking the time today.
Sponsored by our friends at Veeam Software! Make sure to click here and get the latest and greatest data protection platform for everything from containers to your cloud!
Sponsored by the Shift Group - Shift Group is turning athletes into sales professionals. Is your company looking to hire driven, competitive former athletes? Shift Group not only offers a large pool of diverse sales candidates from entry level to leadership – they help early stage companies in developing their hiring strategy, interview process and build strong sales cultures that attract the best talent for early stage companies.
Sponsored by Diabolical Coffee. Devilishly good coffee and diabolically awesome clothing
Bestselling author Fabrice Testa is an exponential thinker, innovator, serial tech entrepreneur, business angel investor, trusted advisor, public speaker, author, and highly sought-after mentor. He has successfully founded, co-founded, or participated in the launch of multiple companies that created hundreds of jobs and generated multi millions in revenue.
He is the creator of the Superpreneur Blueprint framework and has developed a set of cutting-edge strategies and tactics that enable super-entrepreneurs to materialize crazy ideas, build breakthrough ventures, and solve the world’s biggest problems. After helping more than 100 companies excel in their fields, Testa is making this proven methodology publicly available in Super-Entrepreneurship Decoded to help super-entrepreneurs everywhere transform our lives—and the planet.
This was such dynamic and informative chat. I highly recommend the book (which I read multiple times because it was that good) so make sure to follow the links to grab a copy yourself.
Welcome to the show. My name is Eric Wright. I’m the host for your DiscoPosse podcast. I hope that you liked this one as much as I did when I recorded it with Fabrice Testa. Fabrice is an author, an entrepreneur or an investor, and somebody who genuinely is using technology and business to bring good to the world. It was such a fantastic opportunity to really delve into his book Super Entrepreneurship Decoded. I loved it so much that I actually read it multiple times in preparation for the interview, and it was just that good.
So you definitely got to get a copy. Hit the links that are on the website episode page. You can also hit us up on the YouTube definitely reach out. I’m going to be running a contest on my YouTube channel. If you want to get a copy of this book, drop me a comment on the YouTube channel. It’s YouTube.com/c/DiscoPossePodcast and I’m going to be giving away a bunch of copies of this fantastic book. So just check the YouTube page for the details on that one. All right.
And before, speaking of, how do we make stuff like that happen? It goes without saying that the fine folks that make this podcast happen include people like VM Software who have been longtime supporters and who I support because they have a fantastic set of products. As far as data protection goes, they got you covered. Everything you need for your data protection needs, whether it’s in the cloud, whether it’s in containerized platforms, whether it’s SAS, whether it’s on premises, virtualized, even physical servers, all that stuff needs to be backed up and needs to be saved from things like ransomware and all sorts of naughty things that are going on in the world.
So, it could just be Pete in accounting that accidentally deletes a file. It could be somebody who erases a team’s message that shouldn’t have gone away. So get that stuff protected. All right, just go to vee.am/DiscoPosse and it’s just that easy, vee.am/DiscoPosse. And speaking of protection, make sure you protect your data when it’s in transit as well. Easy way to do that is you can use great products like ExpressVPN. The reason why I use VPN is because I like to make sure that I can do my best to protect my identity, protect my data.
And also it’s just fantastic for web testing. If I need to test like, remote location to make sure that it works as expected from different regions. So it’s really, really great. I use ExpressVPN for that very purpose. If you want to check it out yourself, go to tryexpressvpn.com/DiscoPosse and you can get it for yourself. All right. This is Fabrice Testa. I hope you like the show. He is amazing. Get his book.
Hey. Hello. It’s Fabrice Testa and you are listening to DiscoPosse podcast.
This is perfect. What a great way to start the year. This is fantastic. So Fabrice, thank you very much. I’ve been engulfed in the school of Fabrice now for a while. I was really pleased when I had the opportunity to put you on as a potential guest. And I really enjoyed. First, I read your most recent book, which is the Super Entrepreneurship Decoded. Fantastic book. Went a lot through the rest of your history, of course. And leading up to that book, you have so much to bring and you’ve brought so much to the world already.
But for folks that are brand new and who don’t already know you. Fabrice, if you don’t mind, let’s just get a quick bio. We’ll talk about the book and a really good exploration of this concept of the superpreneur.
Yes. Thanks Eric, for welcoming me on this show. Yes. So I’m Fabrice Testa, and actually I’m Belgian. I have also some origins from Italy. So I live in Belgium, but I work mostly. My business is mostly in Luxembourg, so in Europe and I have, of course, travel all over the world during my career. And basically I’m an entrepreneur. So I co-funded different companies in the space sector in the digitalization. One of them achieved 100 million Euro turnover, 200 people. Then this company was sold and after that I funded also a company in the satellite service company, Luxembourg.
And after three years that company was also sold. And after the sale of this company, I had no new entrepreneurial projects. So I started some new life as an investor, a business center. So I did different investments again in different technologies, space, artificial intelligence, ICT, et cetera. And then, I started also to be a coach and mentor to help other entrepreneurs because I wanted to give back somehow and to help other entrepreneurs by sharing my experience. And let’s say those successful strategies and tactics that was working for me.
I also created by that time a blueprint that I call the Superpreneur Blueprint to help entrepreneurs to become what I call superpreneur. And maybe we will discuss more about this and to solve some big problems by materializing crazy ideas. And actually I met a young Dutch entrepreneur in 2017 and he came with a crazy idea. So for me it was the opportunity to also be again involved in a kind of superpreneur venture. So we co-founded with other people in 2019, the company called Maana Electric that is also mentioned in my book.
And now this company is working well. So today I spent my time between this company as a co-founder and shareholder. I also spent time mentoring, coaching, speaking at several events to explain this super entrepreneurship movement that I launched. And I wrote a book, this book, Super-Entrepreneurship Decoded, because I think that one thing was missing in the Superpreneur Blueprint. It was a method, because the Superpreneur Blueprint gives the core pillars, the guiding principles and the key characteristic of this kind of venture, but it was not telling how to do it.
And so I try to analyze what super entrepreneurs and super achievers, how they do it. What is their secret to succeed? Why others fail? And in the book, I unveil five secrets that I think can help entrepreneurs to maximize their chances of success. Of course, it’s not a guarantee of success, but I think it’s a way to maximize the chances of success. They put all these five secrets around a method that I call the crazy method. So that’s a bit of my story and the origin of the book.
I really appreciated the beautiful use of acronyms. So, we’ll talk about crazy as a method. People think, is he meaning literally crazy? But it’s a perfect pairing because it allows us to assign a memorable name to it. And it’s not far off of, you know, these real sort of crazy and moonshot type of ideas. If we take it in this literal sense of the word and then a pathway to execution that’s been tested and proven that you’re bringing this methodology, you’re bringing a framework to the world that you’ve lived and experienced, which is, I think, one of the best things that people need to appreciate about the book.
This is not a Harvard Airplane NBA guide that you read between New York and Boston flights. This is a lived experience that’s brought down and distilled into effective, meaningful steps that you can implement with great analogous references that are meaningful and helpful. And, of course, likes to bring your personal experience. I trust it. I think Nassim Taleb says the greatest way to be a philosopher King is to be a King first and then a philosopher second. Too many times these days, when you go through the business section or these sort of self help sections, it’s a lot of people who are straight from school and their PhD year was writing from research.
And while it’s a beautiful thing, ten years later, when they go back and revisit their early work, they’re like, ‘Oh, wow. I was naïve a lot of times in what was written’. Your book, first of all, tells a beautiful story. And like I mentioned before, we talked, it is you telling the story. It really comes through as a person telling me how to achieve this from their own experience. And I said, it’s a refreshing change because I’ve read a lot of books of this style that aim to do this, and they often come back as the same three things that I already sort of knew, and it’s a little bit reinforcing, but it was very well done.
So I honestly can’t talk enough. We’ll have links, of course, in all the show notes for people, they should absolutely pick up the book.
Thanks, Eric. I really appreciate it. It’s always nice to hear nice words like this, but I think I wrote the book as I would like to read a book, because I also read a lot of non fiction books, maybe between 50 and 60 books, you know, per year. I like book support, entrepreneurship, business, etc. Some are very good, and some, I think are less good because it’s true that there are a lot of, maybe they tend to have some frameworks, et cetera. But you don’t see really how to apply it.
And what I wanted with the book is to give a very simple framework because I think the framework is very simple in essence. Now the difficulty is to apply it in real life, and it’s why I provide in the book worksheets so that people can apply, let’s say the principles of the book, try to answer a lot of questions and try to put in practice the principles of the book. And it’s also why I’m just launching by end of this month, a companion course to the book, which will be called The Crazy Method Launch online course.
And it’s an online coaching program on twelve weeks. Every week there will be a module and we are mostly following, let’s say, the method which is in the book, but I’m going really to dive deep into each of them, which of course, I could not do with the book, because in the book you are obliged a bit to scratch the surface, unfortunately. Because the book will be indigenous and will be much too big. But with the course, I think the people will have really the opportunity to go really, to dive deep into the principles of the book, to put in actions the method that I propose in the book, and hopefully like this, they can really materialize their breakthrough potential.
They can really have a solid plan if, for example, they want to launch this kind of breakthrough venture that I’m suggesting in the book.
The thing that we need to look at, too, and that’s why I appreciated the references throughout and very specific stories that are called on from other parts of the industry as well, is the proof in execution elsewhere. Right. It gives us a chance to have a reason. Why is the book built to last? One of the most popular ones is because it’s five familiar brands that we know, and that familiarity breeds the belief that I can achieve it. There’s something to be said about this, but when you get into the moonshot areas and these very big ideas, it’s a little more difficult to find meaningful, real existing references.
Looking back now, it’s funny that in two years, three years, you’ll look through those stories in the book and they’ll be like it’ll seem obvious, but at the time when you’re writing this, of course, these are still moonshots. We look at Elon Musk, not just in a single moonshot, but in multiple ventures that he’s achieved. You, of course, coming from supporting and investing in space technologies and being in that ecosystem, there’s a lot of these sort of hidden, there’s a hidden world that’s existing that most people are not going to be aware of until it’s already on their phone or wherever it is.
They just take for granted all of this other work that’s happening to support the thing that makes the news or that makes the big story. So I just realized, too, by actually coincidence, I was wearing a SpaceX shirt. My wife and I are both space fanatics. And last time I got a chance, we actually went to watch the Delta Four Orion launch in Florida. It was fantastic. There’s nothing like an in-person launch. And being aware of how seemingly unrealistic that idea is to most people and why the super entrepreneur has to and is somehow able to put that aside and say, this needs to get done.
And despite advice and despite doubt, we’re going to do things to get back to like this, it can be done. So maybe let’s start there describe to me Fabrice, what is the super entrepreneur or the superpreneur?
Yes, I think it’s a good question indeed, to start somehow the conversation. What I call super entrepreneurs are people that they want to solve some big problems. Because I explained in the book that in 2007 we enter in what I call ‘The Edge of Exponential Acceleration’. So everything is really going very fast. Mostly technology is going exponentially, which is a good thing, because today we have many technologies that have achieved a good level of maturity, and they are used by this kind of innovators and inventors to build some amazing solutions.
But at the same time, problems are also accelerating at an exponential pace of change. If you look at climate change and unfortunately, you know, these disasters in Colorado, for example, I strongly believe that this is a consequence of climate change. And we see that we have now more wildfires, more flooding et cetera. In Belgium, for example, we have terrible flooding in the summer. So I think that we must do something. And unfortunately, most of the conventional solutions have proven their limits. So it’s time for radical solutions, what we call crazy ideas, crazy solutions, solutions that initially seem impossible.
But what I try to always explain is that today at the edge of exponential acceleration, nothing is really impossible. And at the edge of the exponential acceleration, impossible becomes possible. And this kind of entrepreneurs, I call them super entrepreneurs because they probably believe that nothing is really impossible. And they are ready to dedicate ten years, 20 years of their lifetime to solve such kind of big problems and to come with some amazing solution that will solve this problem. And, for example, to give a very concrete example to your audience.
There is, for example, this guy in the book that I described, Joseph Pescounty. He is Italian but living in Barcelona, in Spain, and he discovered that he could use some technology used for 3D print human tissues, et cetera. That he could use the same technology to 3D print food and so now he’s using this technology to 3D print food. Imagine that today is, of course, still a very small scale. But imagine that tomorrow he can build machines, he can scale these machines to produce tons of food and 3D print tons of food.
This could be really a big solution for solving hunger around the world, because today, unfortunately, in the world many people, they have only access to one meal per day. So I think at the 21st century, we are always saying we live extra ordinary times, et cetera, which is true. But how can we admit that today in our civilization that some people, they have only access to one meal per day? So I think we need to come with some solutions. And it’s not with the traditional solutions that we will do it.
But with this kind of breakthrough solutions, it will be possible. And so it’s why I call them super entrepreneurs. And just to be clear, I don’t want to oppose one kind of entrepreneur to another kind of entrepreneur. I’m an entrepreneur, and I respect all kind of entrepreneurship. It’s just that these kind of people, I think they are super because they want to really solve big problems, to dedicate a big part of their lifetime to this, to work on moonshot things that others may think are impossible.
When I met this young entrepreneur, Joost van Oorschot, that is also in the book that came with this idea behind Maana Electric. When I met him first, my first reaction was also to say, wow, it’s crazy. He wants to turn sand into solar panels into a machine. This is impossible. So my first reaction and I’m also in this movement. But my first reaction was to say that’s impossible. So our first reaction, because we have a linear mind is to say it’s impossible. And if we go to an exponential mind, then we see the thing is possible, because in the exponential world, you know, if you can go ten times, if you have ten doublings, it’s a grow of 1000.
If it’s 20 doublings, it’s a grow of 1 million, you know. If it’s 30 doublings, is 1 billion growth. So it’s going very fast. And today we see with this progress of technologies that many things are possible. So I think we need to have a mind shift and to really shift our perspective and see. Okay, if I would have a magic wand, how I will solve this problem. And it’s what I recommend to innovators if you would like to solve this problem, what would you do? Don’t think that with possible solution.
Just imagine if you could do it or you will do it. Like, for example, I said this 3D printing machine, like we seen some science fiction movies, you know, that the food is printed or appears directly like this. And this is really something that we think with a magic wand that it could be possible. But today the reality is that it’s probably feasible and it will happen. I’m pretty sure that it will happen in the coming years that it will be at this time.
To take it back to this first principles thinking approach, which I think is obviously the fundamental to the folks that are achieving these sort of grand visions is because they’ve gotten rid of linear thinking. They have to shed the belief that everything is one to 1.1. It truly is this sort of zero to one. Go back to raw materials. And I think Elon Musk was recently on Alex Friedman podcast. He talked about that. The only way you can approach this is simply look at the costs of the raw materials, and the goal in the end, is always to the cost of manufacturing will be asymptotically close to zero above the raw materials.
And it’s just a matter of the work that you do to get closer to that raw material cost. And that’s ultimately what led to battery technologies. And we’re seeing this with solar. But you’ve proven it out right in that very idea that if you just said, well, we have to just make it slightly better than the current lithium manufacturing, right? That can’t be it. You had to go to what seems like a crazy idea, as Joost brings and say, okay, what if we actually could do this and then you realize you always could with the right, first mindset and then second, which is why the book is important, executing the approach in operations as well, because there’s lots of big ideas.
But then having the team, the growth, the understanding to financially survive to execution is where, it’s a long distance from idea to execution. So that’s why where do we learn this? Is it as rare as it seems to be able to have this thinking?
Yes, I think you are right, Eric. When I met again, when I met you the first time, I was thinking, okay, that’s impossible to transform sand into solar panels. All this will be impossible. But then I go just 1 minute after. Yeah, but let’s imagine that it can work. Okay. So I asked some people, do you think that it’s possible? And many people told me, look, it’s not against the laws of physics, in sand, you can find everything to transform it into Silicon and then into solar cells and glass.
So basically it’s possible from just a physique standpoint. And so this was for me, the confirmation. Okay, that’s probably possible. So now let’s dive a bit deeper into that. So I did my due diligence. I analyze more. I try to understand also the business model, et cetera. What was the plan? I was also impressed by your master plan. It’s a notion that I explain also in the book, what were the big goals, etcetera. And to be honest, we are just following the big milestones right now.
And then you are right. I think an idea remains an idea until it is materialized and so what I see so many times is entrepreneurs. They have a lot of ideas, et cetera. But they never take action, or if they take action, they take the bad action. So it’s why I always say first, you need to really know, okay, what do you want to achieve? What do you want to create in this world? What is your true purpose? Okay. And after that, you need to press your crazy ideas that these crazy ideas will really allow you to materialize somehow your big dreams and you have to dream big and bold.
Many people are unfortunately not audacious enough. These kind of super entrepreneurs or super achievers. They have dream. They have big dreams. They believe in their big dreams, and they are bold. They take the necessary actions to materialize their dreams. But you are right that the proper execution is key, because without a proper execution, without what I call a flawless execution, you cannot, unfortunately, materialize because these kind of moonshots are very complicated, to be honest, to be achieved, to be materialized. So it’s why it’s very important to have a flawless execution.
And these kind of super entrepreneurs and super achievers, they are master at execution. They really try to see anything that can help the business. And now the secret one of the secret to succeed this flawless execution is to have a good preparation. The preparation is key, but now you have not also to spend months and months just in preparation and never take action. So I think there is a good balance to have when you think that your plans are good enough, then you have to act and maybe to revise a little bit your plans, et cetera, iterate.
Of course, move forward because I see also a lot of entrepreneurs. They have big ideas. They create big plans, but at the end they have the fear to fail. Or maybe they try to perfection their plans, but at some point they never do it. And they have very nice pitch deck. Or they have very nice business plans, or they have even very nice products. But they never ask the customers about their products or they never try to sell their products. So they have fantastic products. But at some point they never question also the business case for the product.
Again, it’s nice to have big ideas, but you need to go from a big idea, from a dream to a plan and then to some execution. Again, it may seem very simple, and I think the basics of the business is simple. Business is what an entrepreneur is there to solve a problem with a product or service that you want to sell to some people and you make some profits. I think the basic of business are very simple. The realization is something which is more complicated because there are so many parameters and these kind of super entrepreneurs and super achievers, they have a holistic approach about how to manage the company and they try to minimize the flaws in every aspect of their business.
Now you bring up a very important point when without customer validation, this is quite often the death knell for product management and bringing products successfully to market, because if they wait too long before they expose to their buyer and their user and their true technical consumer, they go far down the path to what they believe is the correct thing to build or method to use. And then you have the double problem of number one. They’re now pot committed or too far invested into this. And so they then start to discount the customers ideas like, ‘oh, no, but you don’t understand. We know what we’re doing better. We built it.’
But then the counter problem exists now, Fabrice, where in moonshots, quite often the customer doesn’t exist in a way when you’ve got an idea, you have long plan as to when a customer will be able to test it. How does that gap get bridged in your experience dealing with very early emerging tech?
Yeah, that’s, of course, a good question. And it can be a problem, actually, it’s also something which is well known. And I re-explain also in the book is the technology adoption lifecycle. So initially I think for this kind of, because mostly what I describe in the book are what is called deep tech companies. So it’s really very long. Let’s say moonshot venture that will take probably 5 to 10, if not 20 years, because there is a lot of research and development up front, et cetera. And for these kind of deep tech companies, generally, what you need is to have the validation, at least a kind of validation or pre validation from early pioneers.
So early pioneers are really people that are visionary that love new things, et cetera. That maybe see beyond, they like futuristic things, et cetera. And let’s take the example of Lilium, for example. It’s a company also that I described in the book. What they want is to have a small electric plan to make inter regional, let’s say, or intercity flights. So this will be perfect. It’s a bit like also Uber Air. So it’s these kind of companies that want to make some flight taxis, et cetera.
And you are right. Is there today customers? No. But there are some people that they may question some people and say, look, if this would be available, will you take it? Will you be able to pay for it? And I think there are many people that will say, yeah, I love Uber Air. That for example, in LA, where there is a big traffic jam, maybe I would have the possibility to fly instead of going on the road. I will love it. And I will be ready to pay for it.
So I think you can always find some people that at least validate your, let’s say, your proposition. Now, the difficulty for this kind of companies is that after two pioneers or what we call the early majority that will adopt, let’s say, their product, it will be to go to the mass market. And they might be more complicated. But, yeah, it’s all the difficulty of creating a business that can scale et cetera. But there are some, of course, fully, some strategies to do this. But I think in the case of Lilian, for example, they now went on the stock market.
I think it’s on the Nasdaq, their value at 1.5 billion. So the market believes in what they do. And I think there is a strong, let’s say, thinking among the population that, yes, this kind of solution at some point will take off, which is the right word will take off as long as, for example, the barriers related to air regulations, et cetera will be removed. But early validation is very important. And I like to give a very simple tip to start up, which is the Starbuck tip.
So if you have an idea, you go into Starbucks and you ask someone, ‘Look, I pay you your latte, but you spend ten minutes with me. I explain to you what I want to do, and you just give your honest feedback about what I want to do. If you think that it’s completely crazy, tell me that it’s completely crazy. If you think that you will never pay for it or that it will never work. Just let me know if you think that it’s amazing. Just let me know, et cetera.’
But you know what? Recently, a company in Luxembourg. I met them in an event and they talk about this idea. And I said, Did you validate your idea? “Oh, no, we don’t know exactly yet. We have not talked with potential customers yet, et cetera”. And I told them, look, go into a coffee shop and do this, and they did. And they receive an incredible validation of their solution. And many people said, look, if this would exist, it would be fantastic. And since then, they just won some prices, et cetera.
And they started doing well, because now they are convinced that there is a real market behind. So I do believe that early market validation is very important. But you are right that for this kind of companies, it’s not always easy. I think they have to focus on the pioneers, the early adopters, if at least they have this validation, it’s already a good sign. But after they will have some challenges, of course, for sure.
And I think an important thing that obviously plays out in the book. And with all the work you’re doing and the upcoming courses is, I often call it framework over firepower. That the old saying goes that plans are useless, but planning is essential and being able to adjust pivot, deal with changes in inputs. But if you do not have a framework in which you can apply these methods and you’re lucky more than you’re right in the execution. And this is the belief that we can just sort of throw.
If I scale my engineering team by 100, then I will suddenly be 100 times more productive. And it’s the mythical man month, as they often used to call it a mythical person month, of course, but more politically correct now, because you cannot just throw human firepower at it or money firepower necessarily and have it scale. The framework is incredibly important because then it becomes the methodology that anyone in your team can apply and that it also comes from vision and principle of the company. And I guess when you’re creating your own framework and you’re using your own method here Fabrice or you’re looking to entrepreneurs, especially as an angel investor, what is it that you look for in that, this is an idea and I trust these people to be able to scale towards this solution.
Look, before I make an investment. I use what I call the four T’s. And it’s not because my name is Testa. It’s around the T. And again, I like acronyms et cetera. But here it’s very mnemonic system for me to remember what is important. The first tier is technology. So is this technology really something breakthrough? Is it really something unique? Can this technology really create a big value? So that’s the first tier that I look into. Then I look at the second T, which is traction. And for me again, traction means market.
Is there a big market enough for this? Now, referring back to the previous question, sometimes it may be a bit complicated, but at least, is there some early pioneers, early adopters that, let’s say, that are quite excited about this solution and it’s what I call the traction. Then the third tier is the team. Is there a team able to materialize this big idea within this big market? Because for me, this is essential. It’s the execution. Is the team available today or maybe with some other people to execute the vision?
And then the fourth tier is the timing. Is it the right timing for it? Is it too early or is it too late? It’s a notion that I explain also in the book because I think this is really paramount. And there is a famous person that, unfortunately, I forgot his name. But he did an analysis of many ventures. What were their success factors, et cetera. And among, let’s say, all these startups et cetera. I think the video is available on YouTube. He found that, actually, timing was the key success factor.
So yeah, because why? Because sometimes some people, they have a very good idea, but they come too early and they are going to burn a lot of money before the market is ready. It’s maybe a bit the case, for example of Lilium, that I was talking about previously because I think they have a fantastic solution. But today the market is not fully ready, so they need a lot of cash. And it’s why, for example, they did an IPO to have enough cash. If you are too late for the market, the market is already over, and that’s done.
I think probably you will have some late people that might, let’s say, what we call the late majority that might eventually buy your solution. But the market is over. So it’s finished. So I think the proper market, the proper timing is very important. And what I have observed is that most of these super entrepreneurs, they are able to really sense, ‘Okay. What are the moods of the time? When is the right timing for it? And they launch the solution at the right timing. For example, I think Elon Musk, he was a master in that when he launched Tesla.
I think he really perceived that there was something missing on the market, that it was a time for electrical vehicle. But there was a need for some new kind of electrical vehicle, et cetera. He was right when he launched SpaceX. And you have dealt with SpaceX. It’s also in the right timing because there was all the start of the new space, et cetera. There was many projects of multi constellation, et cetera. And he was right to say, okay, if I can have a solution, which is maybe cheaper, et cetera, I can give a boost into this new space edge.
So I think the timing is very important. So I use these four T’s, the technology, I have the right technology, the right market, the right team, and the right timing. And for me, these are the basics after that. Of course, there are many things, but I think these are the four basics. And if at least a company has these four green lines into these four pillars, then for me, I can try to investigate a bit more.
Yeah, the timing is very interesting, and it’s often, it’s difficult to know until you run the other side of it. But if we take anecdotal experience, combine it with data, and I believe that we are going to be better. And we are today better at predicting that timing and ability to execute into that market. Of course, I brought up Built to Last. The funny thing about Built to Last is most of the stories in Built to Last actually led to pretty deep failures, years after the book had come out because the markets completely shifted away.
And it was sort of the idea that while they were successful in this pivot of those companies, they then failed to pivot soon after, and they suffered because of the belief that it was now stabilized. And they languished what they believed they already achieved what they needed to do to survive. But survival, like most things, is a continuous effort, especially in business when you’ve got funding. In the end, they often say it’s like startups fail for two simple reasons. The money runs out or the founders give up.
Yeah. Exactly. Dispute between the founders, or they give up or the lack of cash. Yes, these are the two main reasons, for sure.
But the four T’s that you talk about are the reason why the second part will occur most likely, right. Because we joke about pets.com and the original.com era. They all would have been fantastically valued and successful today, of course. But we’ve now succeeded on the backs of their failure. And I think that’s what as humans and as learners, in business and in tech, if we take those learnings and we say if given the right timing, if we change the approach, if we go back to first principles, could we bring this back to the market and be successful in it?
It’s good. I like that entrepreneurship as well as being celebrated. We saw a long period where it’s a bit of a tough word when you say the Uber of something. Right. Uber was this fantastic thing. But then it became synonymous with a negative view of the founder, of the specific founder. Right. That story was unfortunate because it truly did taint the incredible thing that was done to change the market to create something that just didn’t exist. And so I like that now entrepreneurship, we’re going to see more and more people that are successful with it, because I think further down towards the school system.
They’re studying these things instead of General Motors and Vodafone and the early technology creators as the case studies. They can now use case studies from the last five to ten years, which are fundamentally different than what we had 30 years ago, which were the case studies that were put in print and treated as the gospel of schooling, at least. And I’m curious on this one, Fabrice. Is there enough further down, even like in high school and secondary education, that is being done to make entrepreneurship a viable future for people?
I feel like we’re still not there yet, but I’m curious of your experience as well, talking to especially early founders.
Yes. I strongly believe that we need more entrepreneurship and not only to create profit ventures but also nonprofit ventures. I think anyway, the same principles of entrepreneurship can be applied also for nonprofit. So we need more people with an entrepreneurship spirit. I think when you have an entrepreneurship spirit, you can achieve anything you want in life because you have some capacity to convince others. You have some tolerance, let’s say, to risk. And maybe again, to things that are impossible. Things that are possible. And unfortunately, I don’t think that today the education system prepares enough for entrepreneurship, at least at primary or secondary school.
Of course, after that, there are some masters in entrepreneurship, et cetera. But yes, when the children are very young, I think there should be more kind of entrepreneurship, which is taught to our children. So, for example, to learn them, how to make great presentations, how to maybe have a small business which can be a profit or nonprofit, but at least to try to put in place of projects. So project management is very important. How to test their hypothesis, how to make experiments. That failure is not a problem.
I think there are many, many notions that could be to learn, for example, the exponential technologies. It may seem complicated, but it’s not, you know, a 3D printer is not so expensive and they could play with the 3D printer to build stuff, et cetera. AI, for example, coding in Python, et cetera. It’s also not expensive. So I think there are many things that could be taught in virtual reality, and that are sold today. This metaphors, et cetera. Again, just simple glasses, et cetera for virtual reality is not so expensive.
So I think today again, because in this age of exponential acceleration, we also seem a decrease of many costs, et cetera. So it’s the zero marginal cost society that has been well described by Jeremy Rifkin. And so, today many of these technologies are not so expensive if you want just to experiment a little bit. So why not to create in school some kind of living lapse where children, they can play with this. They can also try to put in place some projects and to pitch their projects in front of an audience, et cetera.
Maybe to fundraise also because sometimes they ask to the parents, or they ask to the teachers, but why not to the children themselves to try to fund raise for their school. And we should also learn the principles of personal finance to children because it’s something which is also not taught. And I think it’s unfortunate. So I think there is a lot to do in that space, unfortunately.
Yeah. You are speaking the words that I think of and said so well to this idea that there are things that we do not teach. And I guess there’s an assumption that the parents, it’s on the parents to teach these principles. But in the end, if it’s not promoted through the school system where they spend the majority of their time learning where that’s the most formal part of their day to day education. By the time the parents get around to it, they’ve spent a day learning or a day in some kind of programmatic method.
The last thing you’re going to do is suddenly, hey, let’s explore creating a pitch deck. And it’s funny that when I work with my kids and I recall here that you have kids as well.
Yeah. Four kids.
There you go. I know your number too. I’m the same. And my older kids when they would come to me for money, I would say, okay, what can we do? So that if I give you this money, we can turn it into a way that it can create more money. The first thing is what’s a repeatable thing that we can do. So rather than just go and buy this thing once and at least just to introduce critical thinking and them having to explain why they really wanted something to me.
They would often become more confident, like, okay, so I’ve got this idea. I need $40 for something. But I’ve got an idea. What I’m going to do is I’ve got a bunch of stuff in my closet. I’m going to maybe do a garage sale. And so I would say, well, tell you what, I’ll save you the trouble. We’re going to donate it. And I’ll give you the money so that we can win twice because you’re going to help somebody in need. And you’ve pitched your case.
I’m now your VC is when you give them, though, that freedom to create an idea and to push to get towards it, they feel good. And you can tell in the next thing they ask you. Now they’ve got an approach. They’ve got a method, right. So I think next time they go to their teacher, they’re going to say, I need more time on this. But here’s my proposal. I’m going to run a study group. This is entrepreneurship in the smallest way. I love that spirit, and you can see it in the kids.
They know it’s in them. It’s not for everybody for sure. There are many kids who they also think and act and learn differently. And we should support that as well. But for those kids that can take that to the next level, I really think we should be putting stuff in place to help them and nurture that.
No, I like it. And I try to do the same with my kids. For example, one of my son said, ‘There is this business that I know some friends. They do it’, et cetera. I said, you can do it, but I need some capital to start. I said, ‘Look, I will make your sponsor. I will give you the initial money and then you have to try. Then if you make profit, that’s fine. And let’s see how it works’, et cetera. I like it. But you are right.
The parents, of course, that maybe are educated can do it. But many parents probably are not businessmen, or they are not entrepreneurs. So maybe they just don’t think or they don’t have the knowledge to learn to their children. And it’s why at some point, the school should try to learn this kind of principles to the young generation, because I strongly believe that we need and it’s all, you know, my mission. I try to elevate a new generation of young entrepreneurs because I think that entrepreneurs can really shape a better future for humanity.
I think it’s through entrepreneurship, through building new things, et cetera, that we will build a better world, as I always say, build the world you love. I think if you wait, that others, build the world that you love for you, it will not happen. You have to do it. So what the book is also called with more doers more builders that can really shape a new world that will be better for the next generation. I’m a father of four kids, and what I want is that when I pass away, the world will be a bit better than the one that I knew because I want my children and my grandchildren that they live in a better world.
And so I think it’s a collective responsibility. So it’s why I call so this super entrepreneurship, a super entrepreneurship movement. I hope that many people will read the book. It will inspire them. Again, it’s not a guarantee of success, but maybe it will give ideas to some people. Okay. Maybe now it’s my time to start. I will follow some principle of the book, and I will try to take my chance because I think it’s never too late and we have one life. So why not to try at least?
Now, some people will fail. And I also had some failures like everyone that’s perfectly normal. But you need just to say, okay, I fail. What I can learn from this failure. And I can try differently next time. But maybe during this journey, some people will meet some investors or some team members, and maybe the next time they will do another venture with these investors or these team members, and it will work. So I think that’s normal. I think failure is part of the journey, but it’s not a reason to not try.
And I think we need more people that try new things, try to change how things are done. So we need more game changers at all, let’s say, levels of the society, we need more game changers, people that don’t accept the status course. I think there is too much acceptance. Let’s see how things are done. And again, at this age of exponential acceleration, everything is going fast and there is no reason why we could not do things differently and change how the world is going. Again, I think there are many things that are going well.
So I’m not pessimistic at all. I think we live probably much, much better than 100 years ago, for sure. But there are anyway, many problems. And I think it’s the collective responsibility of all of us to try to find some solutions to solve these problems.
Yes. An interesting quote is from Penn Jillette of the magician duo Penn and Teller. And he says two things are invariably true. The world is getting better and people think it’s getting worse. There’s an incredible amount of media attention to negative news stories. It’s very easy for that to spread and to us feel engulfed in this. But as you said by most measurable factors, we are better off economically, better off as far as distribution of food. There are many things we have a long way to go, and it happens by people like yourself and people like the superpreneurs and the people that are ready to give whatever to give back. We can continue to exponentially affect the world and at the same time making it commercially viable to run the organizations that can create these systems and solutions that can give back.
It’s an interesting dichotomy of celebrating sort of the free market capitalism to grow a business fund, development fund, research fund, delivery of new things, and then balance that with making sure that we give back. And I’m optimistic of what’s ahead. But I’m also careful about my optimism. Nothing is automatic for sure. You brought up a great point Fabrice. I’d like to quickly touch on this, too. Failure is an important part of the process, and we’ve all had levels of failure at some point in our life.
For those early entrepreneurs, do you find, is there any risk that a lack of exposure to failure can be problematic? I’d say for them as they begin this entrepreneur journey because they’re maybe not prepared for that first hit, that first thing that could set them back. How do you prepare somebody for adversity when they haven’t experienced it yet?
Yes. Look, let’s be honest. Who likes to fail? I think nobody. I think we all like to win and to never fail, that’s for sure. So I think unless you are wrong, I don’t know people that like to fail, but for me, it’s not a reason not to try. Now, all these super achievers or super entrepreneurs are they let’s say, overcome failures is through their massive transformative purpose. So they know what their true purpose is and they are fully committed to this. So it’s what gets them off the bed every morning and they know why they are doing this. For example, to solve hunger or to try to contribute to climate change, et cetera.
And it’s their strong motivation. So with this, they know that, okay. I have to try. I want to pursue my moonshot. It will take time. I will face setbacks. I will face many years. I will have failures, but I will need just to continue, because what I do is great. What I do can be great for humanity. So I need to just continue, even if I face some fears. I think for me their true purpose is their tool to always keep the true north and to always go, even if there is snow, there is rain, there is a lot of things.
They just continue on their track until they achieve their goals. And this is what I have observed. All these guys took Elon Musk and he waited probably 20 years before SpaceX is a great success. And many rockets just crashed and exploded. So he had a lot of failures. But he just continued. At some point he was almost broke. But he continued again and again. I think it’s just the secret. It’s only the secret to succeed is never give up. Like Winston Churchill was saying, never give up.
But I think it’s true. And these kind of super entrepreneurs and super achievers. They have a relentless, let’s say pursue of their dream or their objective. They will never give up until they reach their dream. Now, at some point, if they see that really, they need to take some other route to go to any way to achieve their dream, they will do it. They are not stupid too, so pivot or to try to change a bit and adapt the plans are also possible, for sure. But generally they are very relentless.
And even if everybody around said, look, you will never succeed, they just continue. Steve Jobs was well-known like this. He was saying, no, we will succeed, we will do it, et cetera. Everybody around was saying, no, it’s impossible. Again, it’s impossible. And he was saying, no, it’s possible. I think it’s really a question of mindset. And if you are fully convinced yourself, I think you can convince others. But if the founder says things that he will not succeed, I’m not sure that it’s going to work, et cetera.
How can he convince his team that it will work? So I think the best super entrepreneurs, they have a very strong belief that what they do will succeed and it’s all. They can convince investors, they can convince team members, they can convince customers because they say no, I’m sure it will work, it will work, et cetera. It’s what I’ve observed. I have known some guys, they were incredible. Even if everybody was believing that it will never work, they will continue. No, I’m sure it will work.
And they were demonstrating why it will work, etc. And they can bring some convincing arguments. Just people follow them. Why? Because dreaming is nice too. And so you try to also believe in these dreams too, because you want to be part of the big dream, because if you don’t have a big dream yourself, but you want to help someone else, maybe to make their dream come true. So I think that’s something which is fascinating.
Oh, definitely. And the most important thing and why I will implore people to pick up the book. And I’ll say that either through the blog or through social media, I want to make sure that people get access to this. So I’m going to offer up to buy up a few copies myself on people’s behalf and make sure that I get more people exposed to this. If you take something that’s executed successfully at scale and bring it down to a human level, that’s what makes day to day entrepreneurship accessible.
If we use the practices and the successes from incredible moonshots and bring them down where there’s less risk and there’s less things but use the methods. This is fantastic. It’s much harder to take traditional business methodologies and then scale them into an area where no one’s been exposed before. This is why it’s such a beautiful opportunity to take the lessons from the book and then put them into day to day. And when I read it, it immediately made me want to revisit a few things that I’ve got active.
I’m an advisor to a start up, and I’m doing other things, and it just lit up an incredible creative spark in me to shed the unnecessary things that are being worked on. And let’s go to core principles. Let’s go to what needs to get done. So I found it to be a very inspiring read, and I sure hope that other folks do. And it’s funny just to further that one thing you talk about SpaceX landing rockets. I use this in presentations all the time recently at a customer talking about how today’s stuff that we see as normal was not that case two years ago, even because Blue Origin, they sent people to the edge of space and back, and they landed the rocket.
So they land the first age of the rockets, and it wasn’t even in the news because it’s normal now. So SpaceX has normalized landing the first stage of a rocket, which was unfathomable five years ago.
Now for sure. And if I tell you that there is a way to land rockets without using any fuel, because SpaceX is using fuel to land rockets. But if I tell you that there is today, a means to do it without using any fuel. So a very sustainable way to reuse a rocket. Will you believe me or will you say that it’s impossible? I can tell you that it’s possible because I’m now part of a venture which is a German entrepreneur, fantastic super entrepreneur. And he just demonstrated very recently with a drop test on a small scale that it works.
It’s a kind of an inflatable parachute, if you want that enveloped, let’s say the rocket and it works, but it’s not using any kind of fuel, et cetera. And so it’s a fully sustainable solution to reuse rockets. So you see, it’s going so fast. What I wanted also to say maybe about the risk is that there are some techniques also to minimize the risk, and it’s part of the good preparation. And I explained a little bit in the book and in this course, the crazy method launchpad that will start end of this month.
I will also give much more explanation about these tools, but there are some tools that exist also to try to have a very good preparation to analyze all the possible risk, et cetera. So that again, the risk of failure still exists, but at least you try to minimize it. And I think that again, maybe some entrepreneurs are fearful to do something because they say it’s going to fail, and sometimes it’s a lack of preparation. I think if you are well prepared, if you have well evaluated risk, and if you see what I like, this principle of asymmetry of risk.
Okay. There are some risk, but they are minimal compared to the reward that can be provided by what I want to do, then it should be always the decision. Okay. I’m going to do it because what I’m going to do if I succeed will just be great for the planet. By the way, if I succeed, I can even have a billion dollar company. Why not? And the risk is quite small. Or at least I know what I can do because I have some backup plans, et cetera, to minimize the risk.
If eventually they would happen.
Well, I look forward to seeing the outcomes from the first cohorts in the crazy method launchpad, so Fabrice will stay close for folks who do want to get in touch with you. What’s the best way they can reach you in order to get in contact?
Yeah. So I think the best way is to go on my, I have two websites, but my main website is fabrictesta.com, where you can find all the information. You can reach out to me on this website. I have also another website, which is superpreneurblueprint.com. I’m also available on all social media networks, Facebook, Instagram, LinkedIn, YouTube. So just feel free to connect with me if you need some advice for your startup. If you need some mentoring, coaching if you want to follow this new course, if you want anything, I try always to be available for entrepreneurs because I love entrepreneurs and I want also to give back by helping them so that we built a better world.
That’s fantastic. Yeah, I wanted to spend some time talking to mentoring, but I didn’t want to take away from what we wanted to talk about here. Mentoring is incredibly close to home to myself as well, and I’ve definitely seen the advantages that come. And so thank you for giving back to the entrepreneur community. In doing that, it’s more and more. I’ve now spoken to a couple of hundred entrepreneurs through the course of this podcast life, and invariably the successful ones always say my success is because of the lessons that were given to me by others through mentoring and effectively, we can save each other risk.
We can save each other pain. We can share. It’s not all just about pat on the back. You’re doing a great job, kid, and that’s really not what mentoring is about. Mentoring is about having a good, critical voice partner to share ideas with, and I’ve seen it myself as a recipient and also in mentoring I’ve done in the community as well, so it’s great. Hopefully we’ll come back. I’d love to have you back on again in the future, and we can talk a bit more deeply about mentoring.
With pleasure, Eric. It was a great conversation, great questions. And I really enjoy very much this conversation. Thanks a lot for inviting me.
Ladies and gentlemen, Fabrice Testa. Thank you very much.
Sponsored by our friends at Veeam Software! Make sure to click here and get the latest and greatest data protection platform for everything from containers to your cloud!
Sponsored by the Shift Group - Shift Group is turning athletes into sales professionals. Is your company looking to hire driven, competitive former athletes? Shift Group not only offers a large pool of diverse sales candidates from entry level to leadership – they help early stage companies in developing their hiring strategy, interview process and build strong sales cultures that attract the best talent for early stage companies.
Sponsored by Diabolical Coffee. Devilishly good coffee and diabolically awesome clothing
Craig Goodwin is the Co-Founder and Chief Platform and Strategy Officer at Cyvatar, a technology-enabled cybersecurity as a service (CSaaS) provider.
He has over 15 years of experience leading security across both the public and private sectors, building holistic security functions that combine the range of security disciplines under a single effective function.
We talk about the method of delivering Cybersecurity-as-a-Service, the reason it’s more critical than ever, and also the approach of building leave-behind process and platforms to deliver the best customer experience.
Welcome, everybody. It’s Wednesday. Or at least it is if you’re catching this when it comes out fresh because this is the DiscoPosse podcast, your weekly leading technology startup podcast, and you’re about to get exposed to a fantastic conversation with Craig Goodwin, who’s of Cyvatar.ai. Now Craig is really fantastic. He’s co founder and he’s somebody who I really enjoyed because as a chief platform and chief strategy officer, he had this beautiful mix of having lived the life of doing the things around security and now brings them to how to deliver these as a platform, as a true cybersecurity, as a service.
Really great stuff. His methods, approach, just a very enjoyable discussion as well. Somebody I would love to spend a bunch of time chatting with. And speaking of spending a bunch of time chatting with. I got to tell you that the reason I get to spend a lot of time chatting with these amazing people is because of the amazing folks that actually make this podcast happen and supporting it. So I want to implore you to please do me a favor. Number one, go check it out because everything you need for your data protection need. You can get from our good friends at Veeam Software.
I’m a longtime friend, fan, and they are really cool and that they’re supporting the podcast and making sure that as they look to bring their own message to the market. I’m pretty pleased that I’ve been able to be a part of that featuring some of the great folks at Veeam as well. So go to vee.am/DiscoPosse. They just came off of AWS re:Invent. They got a really cool campaign. It’s a comic book download, so really cool. So go there. It’s actually the landing page. If you go to vee.am/DiscoPosse, you can get your very own AWS superhero comic book.
Please do that. Very cool. I absolutely recommend it. And also, of course, speaking of protecting, the one thing you want to make sure is not just protecting your data wherever it is by protecting it inflight. Protecting your network, protecting your identity. You can do this by using ExpressVPN. I’m a longtime user of ExpressVPN because I travel a bunch and as part of it, I want to make sure that I’ve got consistency of experience and safety while I’m traveling around and using other WiFi and other networks.
So please do try that. Go to tryexpressvpn.com/DiscoPosse. It really is just that easy. Oh, that’s right. And also, have a coffee company. I hope that you enjoy it. I do. And if you want to go check it out, it’s diabolicalcoffee.com. Not much more to say about that. Really, really good coffee. Go check it out.
Hi. My name is Craig Goodwin. I’m the co-founder of Cyvatar, and you’re listening to the DiscoPosse podcast.
So thank you, Craig, for joining. I’m definitely in excited mode in what we have a chance to talk about, because when I saw Cyvatar come up on the list. You’re actually on my companies to watch. And it’s a rare treat when we can dive into, I’ll say it’s funny. It’s like this burgeoning area around cybersecurity and offering it as a service and injecting ourselves earlier in the development and operational workflow. It’s new to the world, which is terrifying because it shouldn’t be. But this is why the opportunity is huge.
So I think the best thing we can do for folks that are new to you. Craig, if you want to give a quick bio and we’ll talk about Cyvatar and the challenges that you’re solving.
Absolutely. Pleasure to be here, Eric. And thanks for adding Cyvatar to that list. I’m sure it’s a long one given what you do, but I’m privileged to be a part of that. Sure. My name is Craig Goodwin. My background. I’ve been on the end user side of cybersecurity for about 18 years before that. I was in the intelligence services with the UK government and fell out of that when chief security officer was just becoming a thing, really. And then spent 18 years building, operating, running large scale cybersecurity businesses as an end user.
So companies like Monster Worldwide, Ferguson plc, CDK Global, which is a big automotive tech firm out in Chicago and then Fujitsu before finally co founding Cyvatar with my co founder, Corey White, who is based in Orange County in California. He’s also got a long history in cybersecurity, but from the other side of the house. So he’s been building and running cybersecurity vendors for 25 years, and I come from the end user side. So the first pitch of cyberattack is always that we’ve got both ends of the spectrum.
We’ve been there and done it from an end user perspective and also a vendor’s perspective. So we know what’s broken and we know what we need to fix to deliver better outcomes for customers and businesses globally.
I think this is really why I loved your sort of mix in the founding team. It’s a fundamental problem that we have in so many startups is that we attack it purely from the intellectual like this is sort of the scientific method, and we come at things and there are points when you have to have a very opinionated resolution to things. It’s often how we succeed, is you can’t just sort of do incremental change. You have to come in and say, this is the way that it’s going to work.
We have to remap some of the processes. But because you’ve come from the experiential side, the buying side. I used to do the customer deal as well for a couple of decades, and it allows me to approach technology in a way that I know well in a pure intellectual approach. Fantastic. But will this actually get adopted and used in the way that we would hope. Really, the thing that I want to focus on, Craig, is this idea that you’ve seen it in flight. You’ve seen it in play.
You’ve actually implemented solutions, and you know that it’s much more a human problem sometimes than a technology problem, especially in the area of security and cybersecurity. So how did that two sided approach influence your choice to start the company?
Yeah. When I met Corey a couple of years ago, at the kind of founding of Cyvatar, I was in that place where the industry is going crazy right now, particularly from the VC point of view, there are, I don’t know. It changes every day, four and a half thousand plus products out there or something crazy. So I was having a lot of VC friends. A lot of founder friends say to me, you should found a business. You should do something now that you’ll be able to get the funding.
You should take that knowledge that you’ve got as an end user and create something. And I’ve been thinking about it for 6, 12, 18 months, but I wanted to find the right, and it sounds like a bit of a cliche, right? But I wanted to find the right thing, the thing that actually solve the problem as an end user. I’d fought with it for 18 years, and the kind of problems that I found were that I bought pretty much every product that existed. You could say the Noah’s Ark of Cybersecurity, but two of everything.
And that was true. You’d go out and you’d convince yourself as a CSO that your number one objective was to convince the executive team or the board to give you more budget, and you do that. And I do that really well. And then with that budget, I go and buy some more products, but still wouldn’t get to secure. I still wouldn’t get to the actual outcome that I wanted as a chief security officer. No matter how many products I bought, I still found that I needed large internal teams or my own platforms that I built myself internally to actually do the hard part.
And the hard part was actually the fixing. Actually getting into the outcome of secure. And I found that 90% of the products on the market would point out my problems for me, but simply add to that list of things I had to do. Add to the problems that I had to fix and not actually fix or solve any of those problems. When me and Corey met, he told me about his idea for Cyvatar and as a service solution, I said, Well, look, I’ve done that internally, three or four times over.
I’ve built the platform that we need to build to allow that to be successful. I’ve been the end user side consuming that. So let’s join forces. Let’s bring those two components together. He’s been running services businesses for 18 to 25 years, so he knew that one-off services just didn’t cut it anymore. I’ve been running the end user side and knew that products didn’t do it. So then things combined just led to what Cyvatar has ultimately become, which is the ability to pull to your point people, process, and technology altogether into easy to consume subscriptions that mean you’re getting to an actual outcome rather than just finding more and more problems.
Well, I remember, the thing was ADT security or something. It was like something like a physical home security company that had a great set of commercials. And it was the whole thing of there’s monitoring. And then there’s us, right? And this whole thing of like a guy, a bank is getting robbed. And someone just looks at the guard says, “Aren’t you going to do something?” And he says, “hey, he’s robbing the bank”. This is monitoring. Obviously the first layer is always discovery doing that monitoring that observability, which is sort of the new catchphrase in the industry.
But then from that point, is being able to action on it, is the gap, rather than just basically saying, hey, there’s something going on. And now it’s your fault. Your just handing it off to an operator or developer. And this is a complex ecosystem in the organization. The CSO doesn’t have effective control over IT in the same way, because they generally report up, like directly to the CEO. They report up, if anything, possibly adjacent to a CIO, possibly through legal and procurement. More so than just operational IT.
And there’s really a lot of stuff that falls under that bucket. So while they could say, there’s my aspiration to achieve a secure workplace, a secure environment, this now has to cross into seven different divisions of IT and many, many other things.
Yeah, 100%. And I could talk about that for days. I think to unpick that a little bit. You’re absolutely right. I think the trend and it’s going to continue to be a trend is decentralization of the security function. I used to joke or half joke as I was building security functions, that my ultimate goal should be to not need a budget as a chief security officer, right? Because I shouldn’t need to protect the organization. It should be so ingrained into everything we do as a business to your point, the different departments that actually, they understand it.
And I build such a strong culture of security that they pay for out of their own budget. Craig doesn’t need a separate security budget. I’ve tried to do that at the businesses that I’ve always been at, which is to put the power in the hands of the developers, for example, right? Where they have the tools, the power to be secure by design as they build their products, as opposed to what doesn’t work, which is Craig’s team coming along and acting like the police, right?
Which is definite cliche in the industry. But it’s hurt us for many, many years as that kind of outsider type approach to security. And then the other thing you touched on, which is just incredibly important and a lot of people forget is the politics associated with it. Like, how do you drive behavioral change that first day shouldn’t be about looking at technology. It should be about going to buy a Starbucks card, so you can take all the executives that you’ve got to influence out for coffee and build those relationships. Right?
Because that is 100% the most important thing. And one of the things that we’ve done from Cyvatar is enable that. The platform that we’re building or the platform that we’ve built really enables that decentralization. It enables those workflows to be created across organizational bounds and put the power in the hands of the people that actually need to fix it, as opposed to just firing a load of vulnerabilities and alerts at the security team and expecting them to do the hard work in chasing up and getting things fixed and influencing people.
It becomes the challenge. I was at an organization, and this was in the 90s through the 2000s and the CSO didn’t exist. That function wasn’t there. It was at least rare in sort of the Canadian world, particularly, we’re such a friendly bunch. We didn’t need one. Right. And all of a sudden, we see a CSO show up. And this is right around the time that Sarbanes-Oxley also was implemented. So you had, first of all, a functional change in the organization that they were separating out this role of information security officer, and also everybody that had the CXO title was signing their name on a contract that put them personally liable for the outcomes of their organization.
And it really changed things. So immediately, the first thing that happened, as we do with security organizations is they hired a bunch of VPs of security, and then they hired a bunch of directors, which are basically sort of their very high titled interns. And they began crafting policy, crafting policy. Quick. We must craft policies. And it was almost like a Monty Python ask level of, quick a proclamation. And they would come and they would post it on the board, and they would email it out and send. And immediately you’d say, “Well, we can’t do this”.
And they’re like, oh, no worries. Then file for an exception. And then they built a system to file for exceptions. And they had created the sort of process spaghetti. And I was torn, right? Because with what’s going on, I recognize what you needed to do is we need to actually look as an organization. How are we going to attack this problem? How do we recognize the problem within a medium, this is like putting a government into a functional organization and where they don’t see the outcome, they don’t see the negative side effects.
They just simply have to come in and say, policy checkbox. And then as it made it further on the organization, we would just find ways to get through the audit safely. And that was the first phase. But then from there like we’ve seen it in action. We’ve seen real. No one wants their company name to show up in the news. And it’s like when somebody has their name show up in the news and the word embattled is in front of it, there’s certain things you never want to have.
And I’ve got good friends who are solar winds, and that was a tough one to watch them go through where the reputation attached to being exposed to a vulnerability carries for a long time and has a real commercial effect on them just as an example, right?
That was one thing where they’re in the news. So at first it was like, in 2009, it was probably happening all over the place, but it wasn’t in the news. Now there’s a really significant risk that it’s prevalent that this is active in the industry, like DarkSide did it. They created ransomware as a service. This is fantastic. But how do we attack the problem and make sure that we don’t end up in the news? But most importantly, that we aren’t vulnerable. That’s the real thing. Obviously, the news is bad, but let’s actually fix the problem.
So if the ransomware has a service, then what do we do to counteract that?
Yeah. And I think you hit the nail on the head and we could talk for hours about the compliance versus security debate. But I think actually, in a number of cases, compliance is damaged, what we would call real security. Because if you think about, you mentioned the top down approach. One of the things that all those compliance standards first say is, go and get the board approval, like, get your executive buy-in all that stuff, which makes it that very policy focused, like top down approach where we create mandates and then we try and force it into the organization and actually back to that decentralization conversation.
The most effective way I build security is from the ground up. That doesn’t mean negating the executive buy, and you need the budget. You need people to understand what your objectives are, but being very clear with your sponsorship, your leadership, about what is the objective. Do we actually want to be secure, or are we just ticking a box for compliance purposes? If your answer is we actually want to be secure, that’s a very different journey than creating a ton of policies. And that’s one of the fundamental principles when we started Cyvatar, was that there’s a ton of really quick and easy ways to go and get SOC 2 compliance, for example, like, I say, 27001 compliance and will help with the operational aspects of that.
But the majority of the small to medium sized businesses and other companies that we’re serving wants is to be actually protected from ransomware, is to be actually secure. And to your point, like solar winds prevent their name from being in the media because they’ve lost data or been hacked or been interrupted or whatever it might be. They actually want to be secure, and that then differentiates them from their competitors because they’re more secure. So what we’ve done with Cyvatar is build real security in and security that actually gets you secure, which is a big step change from a policy, creating something and telling everyone that they’ve got to do it.
This is real world. How do I prevent that from actually happening and moving to that prevention? Moving to that remediation is the key step that the majority of vendors in the market just don’t appreciate or don’t help customers to achieve right now. .
When it comes to differentiation, it’s funny, I lead them. I’m not going to compare you to anybody. I’m going to compare you against the industry at large, in that you’ve chosen to price by human rather than object. And this is interesting because quite often when we think about security services, developer services, all of these services, they’re effectively marked per application per object per cloud target, per whatever. There’s always some technical target. So let’s talk about that, Craig. The idea that you’re basically working at the human layer with technology and thus you price, I’ll say differently than most folks would expect.
Yeah. 100%. And that’s another indication of number one, kind of that really customer centric approach, making the experience for the customer a lot more streamlined. One of the things me and Corey are constantly looking at the industry or taking our experience and changing the way that things should be done and making it simpler when we thought about the customer consuming it for anyone that’s ever commissioned a penetration test, for example, that horrible booklet of, like, 20 pages you get from the provider that says, and it used to take me even with a security team, four weeks to fill in the technical data to have to gather this technical data, to even get the scoping document back for a penetration test. Right?
And that just can’t be the way it is. So what we wanted to do is number one, make it customer centric, number two, make it really easy to consume. So therefore, what we do is we use the number of employees in the organization as an indicative factor for the size and scale of the organization itself. Right. And that then allows us to build those subscriptions, build those solutions based on the size of the business and scale it effectively. For example, we’ve got customers who have 500.
They’re in the entertainment industry. They have 500 employees that never touch a computer, for example. Right? And we’ll work with our customers to figure out how that subscription works and how best to address it and make it more palatable for that customer themselves. We have other customers where some of their employees have got three or four different laptops. And in the old model, that means four or five different licenses, right? We want to deliver security, true security for the customer. So we’ve build all that complexity.
And we just say, let’s base it on head count. Let’s base it on head count of the organization. As you grow, we grow, and we’ll partner with you to deliver security, whatever that means for the size and scale of your organization.
When it comes to the mapping to importance of the business, it really is a human tally, right? Because the scale of the workforce is effectively a marker of the network effect of risk, because the more people you have, like you said, they’re specific. Some employees, they’ve got seven devices hanging off them. They’re much more active, their field work, so they may be sort of more exposed than others. But then back office folks, they log into the computer only to get their morning email. And then the rest of the stuff they’re doing is they’re scanning paper into systems.
It actually makes complete sense. And you start to think like, ‘Why hasn’t someone done this before?’
That’s my favorite thing. Like, my head gets a little bit bigger because I love it when we sit down with customers. And hopefully that’s an indicator of a good idea, because we sit down with a ton of customers and customers go, doesn’t that exist already? And they’re like, actually, no, no one’s done it like this before. No one’s done it the way that we’re doing now. The reason that we built what we built is because the business model exists elsewhere. The likes of Netflix and the B2C space, the likes of Trinette and others within the B2B space for HR.
Why would you not have that model for security? And that’s what we’ve built with Cyvatar. We always use the example of why would I bother building a HR function at this point and even our revolution? I wouldn’t. I’ll go and outsource it to Trinette because they’re better at it. It makes sense. It works for the scale of business and how we operate. I don’t want to be a HR professional, just like a lot of these businesses don’t want to be security professionals, right? They want someone who can do it for them and actually get to the outcomes of secure.
So that’s why we built the business model that we did for sure.
When you looked at, obviously, the first thing we have is we have team, the three T’s. Right? Team, TAM, technology, as they call it. Right? You’ve got your co founder. You have to address on the technology side, you both come at it from each angle and see if you got a good sense of where you in the technology stack will be able to attack a problem. When assigning TAM, this is really about choosing your first market. What is the ideal customer that you wanted to begin with? Because it literally could be anywhere from SMB up to global enterprise.
There’s a lot of potential. And if you’re a VC, of course, there are like trillions of TAMs. They want this Gartner Esker type of up and to the right quadrants everywhere. They want to see a lot of that stuff. But you, as a founder, you have to be pragmatic about your first market.
Yeah, 100%. And you’re right. There’s a ton of opportunity in terms of even larger enterprise organizations. I’ll talk about that in a second. But if you think about the absolute target market, it’s those Greenfield organizations that haven’t built a security function yet. And what that normally means is probably 500 employees or less in the technology space where the ROI, the return on investment, associated with the model that we’ve created is quite frankly, a no brainer. When you talk to customers and you spell out what it takes to build a security program these days, with the cost of talent, with the complexity of tools, with just everything that’s out there.
And back to that original point about the CTO, and the startup really wants to be focused on making their products great, not doing the cybersecurity stuff. You come in and you take that pain away. And the model from a Greenfield perspective, just makes absolute perfect sense. And even a lot of our customers have got a single contributor, the first CSO hired, like you mentioned before, or the first security person hired into the organization. Even then, what they’re not going to be able to do on day one is justify another ten resources.
And that’s relatively lucky, right? So to have a solution that enables them to be successful and deliver those outcomes as well in a cost effective way, that’s number one target. Right. And also to your point, from the vendor perspective, it’s just a massively underserved market. We talk to a lot of our partners who say anyone under two and a half thousand employees. Our VCs are telling us not to touch because the economics don’t make sense when you get to a certain scale and we throw the term democratization around.
But it’s true. We’re taking these best-of breed technologies that perhaps wouldn’t be accessible to that smaller end of the market and making them accessible, making them consumable because you don’t need those internal resources or expertise to get them in and operational quickly, which is what we’re able to do.
Yeah. It’s kind of funny. Like I’m in the tech space and I meet with large organizations all the time, and they have more developers at most North American banks than the vendors they buy from. So it’s really difficult to go in there and sort of say, all right, we’re going to do a ground up development of this service approach because they’re just like, well, we’re going to use you for six months, and then we’re going to take a team and make them shadow you and then build the thing you do.
So it’s actually often a dangerous thing, especially for a start up to go in with a great fundamental challenge solver because they’re just going to go in. Tech companies are the same way. Right? Large social networks are famous for this one, right? Where they’ll buy a company, buy a product for a year and then not renew. And you’re, like some people on the sales teams are like, I don’t understand, why didn’t they renew? Because they are filled with amazing technologists. And they just watched what you did for a year. That’s all they needed, they needed to be close enough.
I think one of the real differentiators that we’ve got is that we started as a platform player. Right?
So we’re not a product led company. We are true platform. And you see it, we all see it. There are many businesses out there that claim to be platform based organizations. The problem that you’ve got is particularly with the larger businesses. They’re tied to their own products as well. So if you’ve got a shitty antivirus product and then you go and build a platform, well, guess what, which antivirus products are going to be the one you use in that platform. Right? And that’s the problem. What you’ve started from is a very blank canvas that we’ve started from a point where we’re building the platform first.
And therefore, if you want to integrate with us, we will be picking the best-of breed technologies. We’ll have a selection. We’ve got three or four different partners in each of our solution areas, and our member services team is constantly assessing what’s the best out there, what’s going to get the best value for our customers? What’s the best solution? And the customers are subscribing to a flexible subscription, which means if one day AV number one is the best one on the market, we’ll install that. If next day AV number two completely outdoes them and gets to a better state of prevention than number one, we’ll change it out for them.
And that’s all part of that subscription. So it’s focused on the subscription outcome as opposed to the particular product or technology that you’re driving.
Yeah. One of my favorite platform stories. And like, I’m in product marketing, I know, it’s always like, you’re not a tool. You’re a platform. It seems like better marketing. But Dave McJanett, who’s the CEO of HashiCorp, and I said, I described to him and I said, it’s great because you effectively got all these layers and it ultimately makes a platform. And he goes, well, we describe as it, if you squint hard enough, it’s a platform. But it really is a separated set of tools that integrate very easily.
And it was funny that even he was unwilling to use the word platform for fear that it would have this connotation of something that is easy. It’ll be automatic, you have to buy one thing, and then you have to buy the other four things. Their goal was ultimately interoperability, which is, again, this is why I wanted to pick on this point with you, Craig, by being able to know that you’re looking for the best of capabilities, the best-of breed. And you are handling the integration since the interchange.
It means that I don’t, as a customer, have to get locked into going to antivirus A and looking for the best deal, because, effectively, they’re going to tell me why I need them, and then they’re going to suddenly become the one that wants everybody else to integrate with them. I want to have a platform approach where that I can think of it as a framework that I fit things into. And then it gives me the comfort that I can negotiate with those vendors now, because before, especially an antivirus vendor, it’s the easiest thing in the world.
We have 3000 endpoints. How exactly do you think you’re going to change that over? It’s one step away from, it would be a real shame if something were to happen to your car, now, wouldn’t it? Like that’s almost a Mafia-esque type of way. But I’ve worked in organizations where we’re like, I actually had 22,000 endpoints and yeah, we got it done because we threw humans at it. But it was a huge expense. It was a huge lift. It was a huge risk. So if I can offload that risk and that assessment of the right current set of platforms to you, that’s a huge win in my eyes of why I would say Cyvatar is like, all right, this is a true platform play.
Yeah. And you got two things, I think. Number one, you’re absolutely right. A lot of those businesses, like I said before, four and a half thousand products out there, like, what startup wants to come wade through all of that.
The periodic table of things.
All Eric’s product marketing. Who wants to go wade through that to find the one problem. Sorry, the one tool that’s actually going to fix your problem, right? No one can. No one does. Right? So, yeah, that’s number one. My own member services team are experts in the field, have been doing it for 100 plus years, whatever the combined number is, and they will pick the best-of breed, right? Agnostically and build them into the partner framework, build them into the platform. And like I say, we’re not afraid, right?
When partners aren’t performing or it’s not the best tool anymore. We have the capability and the wherewithal to change that out. Because we’re so customer focused, we want it to be about the customer and delivering the right outcome for the customer. The other big deal here, I think, is really important. We went on this evolution, I think you mentioned it earlier for inSecurity from technology, and then we’re definitely focusing on the people right now. But the process bit for me, is probably even more important than the people, right?
Because you can have the best cybersecurity experts in the world. You can have the best tools in the world. If you haven’t got the process that makes those things successful, you’re still ultimately going to fail. And what we’ve built with the platform that we call the operating system for cybersecurity is the process of security, what we call, we’ve got proprietary methodology that we call ICARM, which is installation, configuration, assessment, remediation and maintenance. So you go from all the way from installation of the tools, all the way from maintaining a full security program.
But essentially all it means is the process of security. Like, how do you get from a point where you have nothing or a very immature security function to the point where you’ve got something that’s functional operational and you’re maintaining the organization in a clean maintained state and the tools can be interchangeable. The people can be interchangeable. But that process remains constant. And that’s what we built in the platform. And that’s why I think we are so successful in such a short space of time in terms of getting those outcomes for our customers.
We’ve got that experience, we’ve got that knowledge. We built those processes into the fabric of what we do. And that’s why we’re driving this speed and easiness of security that just amazes people to the point where they don’t believe us sometimes, to the point where people go, how do you do that? And it’s because you’re taking that fundamental approach and you’re building the processes right.
And I don’t want to talk about people leaving the platform, but the subscription model opens the door to a sense of freedom in that they’re not locked in to you, which is a strong thing, right? It’s sort of illegal and functional lock in is difficult, and people don’t want to take on a new thing because there’s sort of a risk there. What’s the thing that, what they say to you, Okay, Craig, I like what you’re doing, but let’s just say for whatever reason, we have to change gears in six months, and I stopped my subscription.
What does that mean for my organization?
Yeah. So we built ‘cancel anytime’ into all of our solutions, just like any other subscription but don’t like using it so much. But back to the Netflix example. For as long as you’re getting value out of Netflix, you’ll continue to pay your subscription. And me and Corey, and the whole of Cyvatar, is not afraid of that model. We truly believe that with those process components, with the people components, with the way that we’re driving value for our customers, it challenges us to continue to continuously drive value across that lifecycle and that lifetime value of that customer.
And we’re not afraid of that challenge, right? We haven’t had anyone canceled yet, and I’m hoping we’re not going to in the future because we are driving that consistent value. We all know my favorite quote ever. I don’t know who said it, so I might just claim it as my own. Security is a condition to be managed. It’s not a problem to be fixed. And that is absolutely true. It’s not a one-off engagement. This is about growing with the customer, partnering with the customer, and being that continuous source of security for the business.
So the short answer is, Eric, as long as we continue to deliver value and the customers see value from it, we’re not scared of it, but we’ve built-in’ cancel anytime’ so that customers, if they really don’t see the value, can make that break.
And I love this idea that you talk about something to be continuously managed. This is not like a juice cleanse to suddenly make you healthy. Security is something you just sort of throw a tool at it, and then by magic, it’s fixed. It really and truly is an operation, because even if the choice is right today, it’s not to say that that particular product or some process that you’ve got won’t be suddenly vulnerable just because of a change in the ecosystem or change in process in a month or two months or six months.
So that’s why it does need to be the subscription and the service model really makes sense to me, because this is something that I want to make sure is maintained. And we think about maintenance as SNS on a contract, right? Like, oh, I can phone 1800. I’ve got a problem with something, but that’s really not what maintenance is about. Maintenance is about maintaining the health of the ecosystem, right?
Yeah. I love the hygiene and health analogies. I think they’re really helpful when you’re thinking about cyber hygiene and cyber security. It’s that continuous process. Corey always gives the example of, I don’t know whether this is true or not, but always gives the example of doing the dishes, right? Doing the washing up, you leave it for three or four days and you’ve got a massive pile and it’s a hell of a workload to get through. Whereas if you do little bits on a daily basis and you could do the same analogy a million times over, whether it’s automotive maintenance or whatever, it might be doing those little things and keeping up with it means that actually over time you’re continuously maintaining that state of hygiene.
You’re continuously maintaining that in a clean state, which makes your job much easier over time, means it doesn’t cost you as much. We talk about another good example is always the developers building code. And if you wait until a vulnerability or whatever is out in the wild, it costs you 50, 60 X, the cost that it would be to fix it while it’s in the development lifecycle. The same is true for general security across the board. Fix it while it’s being happened, build it in, make it a maintenance. Again, back to process.
Make the process continuous, and you’re in that position where you’re getting much more value out of your security program. Pentest is another great example of that. How many organizations just do a one -off pen test every year? How many times have I done a one-off pen test next year. They come back the year after and say, why is it the same as it was last year? Yeah, of course it is. And that pentest somehow makes you secure. But no one does anything about it. It shouldn’t be one-off, it should be continuous.
And in our threat and vulnerability management program, that’s what we’ve done. Yes, you get a pen test every year, but also you’re continuously scanned all year round because you might do your pentest on the coming Monday. But who’s to say six months before that, you didn’t have a vulnerability that’s been hanging around for the last six months. So, yeah, I can’t say enough about the ability to be continuous in that program. And that’s what subscription brings.
This is the funny thing, right? Like you said, compliance and security, while seeming to go in the same. There’s an ampersand between them, like it’s attached to most people’s resume in that way. But it truly is separated functions because compliance is the annual or the quarterly checkbox to make sure that you’ve passed a test. Security is an ongoing operational process to make sure that that’s happening. You said pentest is one that’s interesting because as we develop more active testing, it teaches us to make antifragile systems as well, much more than defensive.
But truly, I’m going to build a system so that it can withstand continuous penetration testing. Actually, at this one place I was at, we used a product and they would do, like, regular scans. So every night, it would go and scan all this stuff and it would wipe out half of our homegrown applications because it would just basically batter them like a denial of service. And then you’d have to restart all these services. And I was like, they said, well, can you stop scanning the system?
I’m like, no, can we start developing to be prepared for it? Like, it was funny that integrating, the tooling changed the practice of development.
Yeah, one of the things that I always liked. And I was talking to someone about it the other day. I was used to just talk about, security is another facet of quality, right? Developers, a lot of development organizations understand the concept of quality. They’re constantly scanning the code for quality. They want to create quality products and quality code. But security is somehow some kind of outlier from that. And when we started to take, and one of the tips I always gave to kind of CSO as they were going into large product based or application based organizations was borrow from what’s already there.
Like take the quality scoring mechanisms and just add security in as a facet of that, because they’re building quality code. They wouldn’t, for the life of them, send out bad quality code. So security is just another facet of that. You can’t build a quality application or product if it’s not also secure. So borrow from that language of the existing business instead of trying to be a special snowflake on the side.
Yeah. Now let’s talk about the Forbes Technology Council. So this is a rare opportunity to be invited in to be a part of this. You’re involved, which it’s a testament to, obviously, your history and your skills and your involvement in affecting the industry, not just purely from your product perspective. What do you feel is a real strong opportunity with something like what the Forbes Technology Council is able to do?
Well, like you said, the name Forbes is one of those things you grow up with, I think, isn’t it? You go through school and you think about Forbes and who do I want to talk to and what’s the goals for me? So, yes, incredibly privileged. I think it’s a great group of people. There’s a great online platform where we share ideas. And to your point, Cyvatar has always been for me, about fundamentally changing the way the industry operates, not just about creating a product, not just about solving a spot problem.
Like a lot of the current solutions do. It’s about fundamentally changing the way we consume. So I think both ways, number one, giving to the Forbes Technology Council, sharing my 18 years worth of CSO experience with other members, helping them to understand how you build security programs, how you do security effectively, what you should be focusing your investment on, but then backwards as well. We get a ton of feedback from those council members about what they want to see, because ultimately, one of the things that we built with Cyvatar is we wanted it to be a business tool as much as a technical security tool, right?
Our audience in startups, particularly is CFO sometimes, it’s CEOs, it’s cofounders, who are not necessarily the most technical savvy people. They want a business outcome, not a technical outcome. So taking feedback and you see a lot of security vendors will take feedback from the technical security communities, which is great and valid. And we do that as well. But also, there’s a massive advantage to taking feedback from senior technology leaders, senior business people who can say, you know what, Craig? I don’t want to see a cross-site scripting vulnerability in an application.
Quite frankly, I couldn’t care less. Tell me how and when it’s going to be fixed. Tell me what it really means to buy business. Tell me how much it’s going to cost me to sort it out. Tell me how I can solve it in the future. Those kind of things, those ROI business based conversations is what we want to solve as a business. And therefore, hearing that feedback, having the opportunity to share that with Forbes Technology Council. Senior technology leaders really benefits Cyvatar and really benefits the way we’re building the platform and the business.
So, yeah, it’s a fantastic opportunity. And I’m proud to be a part of it.
When you’re a certified CSO, which is quite often, the CSO, sadly, is a role that they’re like, it’s like the CIO, which at one point when I was in first getting into tech, CIO used to stand for career is over, right? It was just somebody from the business unit. They were just like, you’re the CIO now. And they’ve served their two years to ride off into the sunset as they headed to retirement. Now it’s an active function and then CSO sort of fell into the same thing, like somebody has to be a CSO.
You, you’re the CSO, right? Make sure no one picks up USB sticks and push them in their laptop. And there was a sudden, you’ve heard a wide eyed thing of like, how do I be an effective CSO? And it’s because it’s a burgeoning role. Certification is something that I think had been vastly missed. So what is the path to certification and what are ways that professionals can look at working towards that?
Yeah. Well, I think that particular qualification is interesting. I think more widely the question around kind of experience as a CSO, to your point being thrust into a role where you’re told to stop USBs being put in computers, for example, I think ultimately comes back to it. And a lot of the responsibility falls on the individual. I did a talk a number of years ago about challenging CSOs as to whether they really are CSOs or not. And what does it really mean to be a CSO? And quite frankly, I don’t have the answer.
I don’t think anyone does. The answer no one likes is it depends. But what that means is when you start that job, you need to fundamentally understand why the role was created and what the executive and the business expects you to do and make sure that’s compatible with what your skill set is. And that’s what needs to happen more in the industry. It’s the same with, I always say, ton of CSOs will join a role and won’t have had a budget conversation for the first twelve months.
They just plow on, on the understanding they’re going to be allowed unlimited products and tools, right? Getting those things upfront, what is my role to our conversation about compliance versus security? All right, you’re hiring me as a CSO, but does that mean you just want us to get top two compliance if it does. And you’re happy to take that you approach that in a very different way than a role that says, actually, I want you to be the technical knowhow, I want you to work with the development teams to embed security into the development lifecycle.
Or I want you to be the strategic leader that is the figurehead for security across our business and drive sales cycles by being better at cybersecurity. All those roles are roles of the CSO, but in different organizations of different maturities and different expectations, and you’re ultimately setting yourself up for failure. If you don’t have that conversation up front with the executive team, with the business. It’s a long way of saying it depends. But as long as you’re clear up front what your role actually means, that’s the only way you’re going to be successful.
Yeah. And I think that’s the ideal thing, even like the CISSP, if you look at the foundations that it tests, it’s very wide range. And it’s everything from physical security to low level programming, understanding all the way up to much more high through technical cloud and networking. It shows you what it takes to really be a security leader in an organization or CSO. It is much more than just one aspect of it. And quite often it’s counter to what we’d expect if we make things more difficult.
If we make things technically challenging, that’s not always securing the environment, it could influence poor practices, because if you make everything super complex and people are just going to write it down, they’re going to write down their passwords. They’re going to do things that will then move against the policy setting, and it becomes, you’re effectively working against yourself by coming with this top down of you will not pass approach.
Well, the advice I’ve always given to anyone kind of early in their career or moving through their career that wants to ultimately become CSO in the end, is wider rather than deeper. It’s becoming more and more a business role. It’s becoming more and more about strategic leadership, about business leadership. There’s been a trend in many large organizations where CSOs aren’t coming from technical backgrounds anymore. You’ve seen people come from the risk function or the project management function or the program management function into CSO roles. And for me personally, I think that’s a really positive thing, bringing people in with that wider business experience.
That wider kind of programmatic experience and strategic leadership, I think, is really important because you get that separated agnostic view like boys and their toys tend to get excited about security technology and AI and all that kind of stuff, whereas someone that takes a business centric approach and says, what’s most important for the business, what is it we’re trying to protect? What is my job here? Like, all of those things contribute to being much more successful than diving in and going, oh, I need to buy this product.
So I think that’s really important. Back to SIT phase, it’s incredibly wise. I think it’s a great certification that you have, out of all the ones that exist to get you that kind of width in terms of understanding when you’re ready to do that. But I think as your career progresses, you want to know a little about a lot of different things. I’m no technical expert. I have technical people who do that for me. You can’t do everything. And it’s about having a little of a lot. I think as you grow up as a CSO.
In the world of tech, especially community is incredibly important, and the ability for people to find a peer group. We’ve talked about the Forbes Tech Council, which I primarily is savant at the C-suite. There’s a lot of folks that are there that they can really look at the leadership level. There’s others that go further down in New York. But then you’ve got the bottom up, sort of the SANS and even the BSides and those types of conference opportunities. What is if you’re saying, as a Cyvatar founder, what’s your community of practice that you feel is effective in helping your team both empower as well as to stay close to what’s really going on out in the world?
Yeah. I think it massively differs depending on the team. Right. So for me and Corey as co-founders, it’s entrepreneurial organizations. It’s learning from other founders, people that have been there and done it. And actually, one of the things that I’m really passionate about is not in cybersecurity. I’ve got some great friends who are founders in cybersecurity, which is fantastic. But you’ll see from the way that we’ve built the business, we haven’t learned from cyber, we’ve learned from other business models, and we brought that into the immature space that is cybersecurity.
So therefore, when we’re learning from other businesses, subscription based businesses like ourselves or SAAS businesses or whatever. So me and Corey have been very conscious to take those learnings from other areas. And the other thing to remember is we read a lot of books. We listen to a lot of audiobooks, get ideas from those things, but don’t prescribe to one single thing. There’s millions of different ideas from different theories and different books all come together to create a strong business model. So I would say, for me and Corey, that’s important.
But then, obviously, like our member services team, they’re heavily embedded in the ethical world of security. It’s their job to know what the best products are on behalf of our customers. So they’re absolutely interacting in the black hats of the world, the cybersecurity conferences of the world where they can hear have their ear to the ground so that ultimately our customers don’t need to do that themselves. And we’re taking that burden away from them. And then we encourage everyone. One of the things that we have all done in the business is go through a course called Scaling Up, which is a methodology for building businesses.
And we’ve been really open with the whole team from the beginning. It would be easy just to have me and Corey do that because we’re building the business. But actually, we wanted everyone to understand that methodology. The Rockefeller methodology for building a business. We wanted everyone to know what that meant, how it operated, so that as we grow, we can be completely transparent with the whole team. And everyone understands that they play a part in it. Everyone understands that they’re a part of the growth of the business. We do KPI stand up calls every day where everyone sees what the business is doing.
Are we failing in certain areas? How do we change that? And we have those open conversations with the team where everyone shares the learning and we build the business together. And me and Corey think that that visibility is incredibly key. So to your point, there’s definitely external communities, but there’s also internal communities where we bring all of that together and we grow as one team.
And I think this is also a testament to your approach in that when I choose a vendor, why we say the three T’s begins with team, I have to depend that the company that I’m buying from has viability, and it’s really difficult, right? If you’re like, they look around and know that, I’ve got twelve series A technology companies that look exciting and you know that they are close enough in their messaging and in the end, in four years or six years, there will be three series D company. But I have to lay that bet.
And your approach is beautiful, right? It’s differentiated because this means that trust that you will grow with me as an organization, as a customer versus like, yeah, we got a widget problem, I get to solve your widget problem. That’s fantastic. There are pure specific problems to solve, but being consultative and not just looking at like, all right, I’m just looking to get the CRC and get bought by Accenture like, whatever the thing is, not that that couldn’t happen, but you’re looking at growth. You’re looking at building a foundation on which you can grow with customers.
And again, like I said, the weird thing is I called on the pricing and the subscription model early because it’s such a rare treat that, you know, that the sense of freedom gives you the ability to be free to adopt. It’s such a funny thing, but it’s a welcome change, especially in the world right now, where we have to be able to adapt. We don’t know what four months from now is going to look like, and just that sense that you could buy as you need grow in a consultative approach, learn from experts who are, their economy of scale is knowledge scale.
I can’t possibly, with an 800 person organization or 4000 person organization, trust that I can hire 25 people that I’m going to send to conferences every week and make sure they’re on top of things and that they’re doing their bloody job. That’s why I love the approach.
100%. And I think that’s why it’s so important for us. If you look at me and Corey, you look at many VC funded businesses, ostensibly, you have a very technical founding team. You have a team that is focused on product building the widget, whatever it is. And that is what the team is really highly focused on. They’re very good at doing that. And then you get a ton of sales people who go out and push that with you and push that product, right? Our business is fundamentally built on the experience of the customer, where we add value is in that people and process space, it’s not necessarily what we’ve got some solid technology in the platform.
It’s not product led, and therefore it’s really important to us that the customer and the customer’s experience is at the heart of everything that we do. And that means that we approach it slightly differently. That means that all of our team members are highly skilled in what they do, highly skilled in making the customer experience incredible. And second to none, not necessarily highly experienced in selling a widget. Right?
Which is not what we’ve built the business to do. And to your point about cancel anytime we fail, we fail as a business. If the customers aren’t seeing the value and the fundamental value proposition that we deliver, so that’s where our heart is at. That’s where we focus. The business is all about that experience.
Yeah, because there’s nothing worse when you buy a product and you just look concerned. It’s always the matrix is the same and look like I said, I’m in product marketing. I know the dance we do. You’re going to have a three column thing and most people will land in the middle. You want to edge them towards the far right. You want to put them in the enterprise plus, or we call it platinum or unobtainium. We call it some exciting new thing, and it’s always like basic bronze, iron, cobalt, whatever. We try and make it like no one buys that thing.
But the fact that you’ve got a freemium entry point all the way up through effectively scaling on consultative additions to what you’re doing. You’re using a human based counter on the engagement level. Like I said, it’s a refreshing change. And I was excited by the approach, and I’ll be excited to have you on when we announced your series D as well. So mark your calendars, kids. You’ve got a lot of really good stuff coming ahead. I’m sure.
Yeah, we’re super excited as well. Thanks for having me on, Eric. Yeah, I think you mentioned it there. We want to take that consultative approach. We’re not afraid to say customers, don’t buy this. It’s too advanced for you right now. Don’t go buy APT protection against AI threats when you’ve got, you haven’t done your basics of building a threat and vulnerability management program yet. You don’t know what assets you’ve got. So we take customers through that journey. We don’t sell them something they don’t need, and we really help them to build a program that’s strong enough for where they are in their maturity in their growth phase.
But then, from a Cyvatar perspective, we grant super quick. Really excited to be on this journey. I say to the whole team, we want to enjoy the ride as much as the destination, if not more. So we’re having a great time doing it. Team is incredible. Customers are incredible. And yeah, looking forward to updating you on series B, C, and D, hopefully.
Definitely a lot of good stuff. And as far as the building approach, too, this is something we can actually, I’d love to have you back on, and we can dive into the founding team relationship of a technical founder and a nontechnical, is always such a, it sounds almost like a pejorative, but in that you’re not purely technical as a founder. It’s such an interesting mix and finding that match, it’s kind of hilarious. I’m sure when we look back on it, it’s always like chapter one of every book where you’re like, here is Craig.
And then he was sitting in a coffee shop in San Francisco.
It was a pub in San Francisco instead. I said, it super fast. The story of Cyvatar is just, the founding story is an incredible one because there were so many factors that might not have led to it happening. I lost my father a month before RSA in San Francisco. I nearly didn’t go. I was very tired at the end of a long week, and I nearly didn’t grab a beer with Corey. All those things just capitulated. And I eventually did. And the rest is history. Corey would say it was the universe.
I’m English, so I’d say it was luck, but whichever one it was worked out in the end, and like I say, the rest is history. But yeah, there’s a good story for a book there one day.
Yeah. And it’s hilarious that when you look back on it, you realize how many of those opportune moments that really, truly like I said, it’s luck of occurrence and somebody else as well. I literally just went into an Apple event and I happened to be sitting next to somebody. And next thing, they were backing my start up that I had never thought I was going to build four months later. It’s like just by the happenstance of sitting in a seat, never know what can occur. But it’s much more than the luck of the moments.
It’s the gumption and the choice of the team to put the time and work into it. So it’s pretty amazing see it come together. Good stuff. So, Craig, if people want to reach out to you and get connected, what’s the best way to do that?
I love the social media. I’m all over it, Eric. So hit me up on LinkedIn. I’m on Twitter or obviously Cyvatar.ai for Cyvatar stuff, but I’m pretty easy to find online, so feel free to reach out.
Excellent. Well, thank you very much, Craig. It’s been a real pleasure. And there you go, folks. The links will be down in the show notes and such. And yeah, this was great. And sure enough, just like I said, history always tells you that if I say I’m going to have technical problems, we had technical problems. But we got through it. And this was a really great conversation. Thank you very much.
Sponsored by our friends at Veeam Software! Make sure to click here and get the latest and greatest data protection platform for everything from containers to your cloud!
Sponsored by the Shift Group - Shift Group is turning athletes into sales professionals. Is your company looking to hire driven, competitive former athletes? Shift Group not only offers a large pool of diverse sales candidates from entry level to leadership – they help early stage companies in developing their hiring strategy, interview process and build strong sales cultures that attract the best talent for early stage companies.
Sponsored by Diabolical Coffee. Devilishly good coffee and diabolically awesome clothing
Carl Gould is a business growth expert, author and serial entrepreneur. His career started by accident when he broke his leg and dropped out of his undergraduate accounting and finance program. At eighteen, he turned to what he knew best- landscaping- and his business growth endeavors began as he doubled his business each year for the next five years until it sold. Since then Carl has built three multi-million dollar businesses before age 40, and advises others on successful growth strategy.
Carl and I explore many important aspects and lessons around growing and starting a business, the importance of leadership, empathy, team, and understanding process flow to succeed in scaling.
Sponsored by Diabolical Coffee. Devilishly good coffee and diabolically awesome clothing
Shlomi Levin is the CTO and co-founder of Perception Point and also skilled in Security Research, Python, Penetration Testing, Cryptography, and Application Security. Strong entrepreneurship professional with a Bachelor of Science (BSc) focused in Computer Science from Bar-Ilan University.
We discuss the challenge that Shlomi and the Perception Point team are solving, how he used first principles thinking to enter into a market that was incredibly challenging, the roots of Israeli startups, and the art of product market fit and the “pivot”.
If you’re at all into security research, this is a must-listen! Perception Point is described as Prevention-as-a-Service, and the real-time nature of their platform is really amazing.
Sponsored by Diabolical Coffee. Devilishly good coffee and diabolically awesome clothing
Michelle Seiler Tucker is a #1 bestselling author and leading authority on buying, selling, fixing, and growing businesses. Michelle joined forces on her new book, Exit Rich, with Sharon Lechter, finance expert and co-author of Rich Dad Poor Dad, to create a must-have guide for all business owners – whether they’re gearing up to sell a business now or just starting to build out their company – to sell for huge profits in the future.
We explore tons of solid lessons in buidling and growing a successful business, the reasons the market data you think you know are wrong, and so much that is needed as real truths in business for startups and major organizations everywhere. Thank you Michelle for sharing so much great info!
You can get a preview of the book at https://exitrichbook.com which also gets you the hardcover copy to you when it launches in June. That gets you access to Club CEO and much more as well.
You’ve brought a lot of great information to the market. You’ve got a recent book called Exit Rich. We got a lot of stuff we’ll talk about. So with that, Michelle, do you want to give yourself a quick a quick bio to folks that are brand new to you? And then we’ll talk about the book and in your background, what brought you to write it?
All right, so I’m not sure what you want me to say on my M&A mergers and acquisitions, Michelle Seiler-Tucker been in business for best selling companies a little over 20 years. I personally sell 500 businesses. My team has.
So my myself and my team have sort of a thousand companies and we’ve done thousands upon thousands of valuations. I also specialize in buying, selling, fixing, growing companies. So I’ll buy businesses, flip them. I partner with business owners, investing my time, energy effort and capital and resources to put business owners on a bill to sell program. And like I said, what we really specialize in doing is fixing businesses because eight out of 10 businesses will sell, according to Steve Forbes.
And so we fix businesses, we grow them. We put them on a bill to sell model and we merge businesses and sell businesses.
So that’s what we do at any given time. On five to 10 businesses, I’m actually building to sell.
Now, that obviously has come from you’ve effectively built a strong system around what it is you need to do to be successful in this.
I’m curious, Michelle, what was the background that brought you to to taking this on as a as a task in your first time show? And I forgot to mention, I’m an author of three books.
That’s right. Yeah. Not just one book. Of course, it’s a rich the most is one we’ll talk about, but we’ll talk about the others as well. You’ve got it. You’re very prolific. What brought you into being in the business of buying business and mergers and acquisitions? Michelle.
So I’ve always been an entrepreneur of all many different companies, even from a very young age. And I did go into franchise sales, franchise development and franchise consulting and sold hundreds and hundreds of franchises.
But I kept having lots of buyers ask me for existing businesses and how many existing businesses, because I was selling new franchises and I was actually partners in different franchise laws and equity partner. Then I decided, you know, there’s so many buyers out here for good existing businesses versus new startup franchises that I should start my mergers and acquisitions firm. And that’s really how I got started.
Now, the you talked about being an early entrepreneur, what actually gave you the the entrepreneurial bug? Was it because I’m imagining you? Probably that’s something we we develop, but we learn about often quite early in our lives.
Yeah. I don’t say there’s anything that gave me I didn’t really grow up in a family of entrepreneurs. My dad had a couple of businesses. He wasn’t really I wouldn’t say he was very successful, but he had a few businesses. Other than that, I didn’t really grow up with entrepreneurs.
I just knew from early on that I didn’t like to be told what to do and I want to do my own thing, march to the beat of my own drum. And I just knew I always knew I wanted to be my own boss, I guess.
Yeah. My favorite thing is founders often described themselves as unemployable just because it’s like they they know what they want to achieve and they certainly are. They can’t take direction in order to get to it. So, yeah, I mean, we still got to be employed by our clients, right? Our clients. Employers don’t we don’t listen to our clients and don’t follow our client’s instructions. Sometimes we can become unemployed very easily. So rather, you want to be employed or be told what to do.
Even if you own your own boss, you still are answering to somebody.
Now, when you were working through in the franchise area, you know, which is developed on the idea of using a systematic approach. When did when did you sort of see that as an opportunity to go outside and bring that systematic approach than to, as you said, like existing businesses? And I’m curious that that first one or the first few that you you decided to take on.
What I’m sorry, what systematic approach are you referring to, or just like when do you when did you see how you could take the practices that you had learned from working in the franchise and then bring this that sort of those methodologies to an existing business?
Yeah, so it’s extremely different. And if you’re not familiar with it or most people aren’t, it’s very different. I mean, becoming a partner with a new franchise or a franchise or and doing a franchise sales franchise development, franchise consulting is extremely different than selling existing businesses and fixing and growing and going to sell existing businesses. There’s really very little similarity. The only similarity is maybe in the existing franchises or because existing franchises are really has to operate on what I call the six P’s, the six P’s that we talk about in my book, Exit Reg, if they don’t build a vault, a solid foundation of solid infrastructure on the six PS, they’re not going to they’re not going to be sustainable.
They’re not going to be able to scale. They’re not going to be able to stay in business for very long. So there are some similarities there. As far as the main franchise corporation, as far as selling new franchises, new franchises is completely different than selling existing businesses is really zero similarities because for a new franchise, for new franchise, we’re looking for the franchisee or qualifying the franchisee in a financial capacity and our skill sets. We need to do that with existing businesses.
You qualify buyers on their financial capacity and their skill sets. But with a new franchise, we’re also really strongly looking at demographics and what we should place. This new franchise, you know, where they want strip mall location, we should put it in, you know, and then we’re helping them hire their people and we’re hiring. We’re helping them really based our business and start their business on what I call the Steve six PS with an existing business that we have the location already have the people in place.
Right. They already have and are operating on many of the six figures, maybe not all, but some of them. So there are some similarities, like I said, in a franchise or type of it. But as far as our new franchises, compared to existing businesses, it’s completely different.
When you saw the and the opportunity to affect somebodies growth and, you know, help, as you said, like to build towards sale, you know what what was what’s exciting to you about seeing that? You know, obviously there’s a there’s both a business and a people impact. I mean, I’d love to hear, you know, what what drew you to be able to bring people through that journey to prepare them for sale?
You mean for existing or for different existing? What prepared me, I think it’s already many different companies in many different verticals sitting behind a desk knowing what works, what doesn’t, you know, really figuring out. Doesn’t matter what industry you’re in, the six PS or the six PS and they they you know, it’s a foundation that you really need in every vertical regardless. And I think that’s kind of what prepared me to seeing what works, what doesn’t work.
And, you know, most business owners, a lot of business owners are not sellable. Like I said before, 80 percent of businesses don’t sell. And the reasons for those are all similar. It’s not necessarily make the same mistakes over and over and over again.
And so that’s, you know, spending 20, 20 plus years in the trenches is selling franchises and then selling businesses.
I think all of that is what prepared me, not to mention my own company is that I’ve done I’ve operated.
And that’s the the interesting thing. As you said, a lot of it’s repeatable things that you see.
And but for those business builders and owners, I think the tough part is they’re so they’re they’re very sort of myopic in their view. They can’t see outside of their own set of of running the organization. It’s probably and this is why they need, you know, you to come in and say, look, I’m I’m looking into what you’re doing and I’ve seen this play out and it’s not going to play out well. Right.
What’s the what’s the reception when you begin to consult through that process and have to kind of show people the works of the challenges that they’re facing?
So some are open to change and some are not. I always say you can only grow the business as much as you can grow the owner. I don’t know if you’ve ever watched the show. Marcus Lemonis The profits on CNBC, but he gives them clear instructions of what to do and what to change, and they all push back. I don’t think anybody just takes it and does it. Nobody really follows his lead and his instructions, even though he’s really clearly the expert.
And same thing with me. I’m clearly an expert at what I do, you know. So, yeah, we get a lot of pushback because, again, they’re entrepreneurs. They don’t want to be told what to do. They don’t want to answer to anybody and, you know, like us. And it’s tough because you’re right. I mean, they don’t see things when you’re in your fog, it’s foggy and you really need an outsider’s perspective, you know, to to help really read the warning signs and keep you out of the danger zone.
But business owners have to be willing to listen. They have to be willing to, you know, get advice from experts, somebody who’s been on the road before.
And they have to be willing to to change and make change. And some are. Some aren’t. You know, I’ve I’ve sat in meetings and told business owners, don’t tell your employees that you’re selling your business, and the next thing to do is turn around, tell their employees. And then I wonder why 50 percent of the workforce quit sooner.
So it’s just.
Is it just business owners want to do things their own way, so it’s really our job to to try to get the business owners to understand that this is for your own good. This is for your protection. This is to help protect your company and help maximize your value. And that’s what we do. You know, we we don’t go in and force things. We do it from a educational perspective versus just trying to slam something down their throat.
And luckily, you’ve got the believability because you’ve got proof in execution, right, and I think that will hope that that helps those those founders to at least trust.
But like you said, there’s a there’s the psychology of the founder.
They’re pretty sure they’ve got the right idea in the market.
Just isn’t ready versus.
Yeah, maybe you need to meet in the middle with the markets. Right?
I mean, put yourself in their shoes. You know, if you’re running your business and the day to day doing all this stuff and somebody comes out and says, you’re doing everything wrong, the first thing you’re going to do is push back. That’s right.
So you don’t want to go in there pushing because then you’re going to automatically get pushed back.
So you want to really go in there and and look at all the things that they’re doing. Right. And highlight all the things that they’re doing right. And then come in and bring in the areas of opportunity to where they can really affect change and growth.
When you raised it earlier already, you talked about it like we have to listen to our clients and ultimately our customers, right. And it’s that is something that quite often it’s also it’s a dichotomy of the founder that they have to be very like they have to be aiming towards a vision that strong, you know, a mission that’s that’s big quite often. And it’s a weird thing of like they have to listen to the market, but they also have to create a market sometimes.
So when when you’re working with founders, like, how do you kind of merge the reality of the market that they’re facing and yet help them to make maintain their original vision? Is and or is it possible? I’m just curious in in how that’s played out in some of the examples you’ve gone through.
How do I help? I’m trying to understand your question.
So like when because like a founders vision is often built on like we are preparing the world for what it doesn’t know it needs, like they did when he came back to Apple.
Right. But it’s a tough thing when you have to they have to survive in order to execute that vision. And how do you bring the reality of market economics and survival to still staying on the path to executing those big visions?
Well, you know, I tell you, I don’t know how much research you’ve done on the business landscape in the United States, and I think I’m going to take a few minutes to educate. But when I wrote my very first book, Sell Your Business, for what it’s worth in 2013 and did the research back then. Ninety five percent of all startups from one to five years will go out of business. Right. Right. So when I wrote Exit Rich in twenty nineteen, twenty twenty before the pandemic occurred and did the exact same research, I learned the business landscape has actually flip flopped.
It’s only 30 percent now of startups that will go out of business. Those one to five years are not at great risk anymore. Only 30 percent, which is good news to Startup Nation. However. On a twenty seven point six million companies, those businesses have been in business ten years or longer. Seventy seven zero percent will go out of business.
It used to be, if you’re in business five, 10, 15, 20 years, you’re in business for the long haul. Not anymore.
The longer you’re in business, the more you’re at risk of going out of business. Now, you’ve heard about the big public companies, Toys R US being in business. Seventy five years goes out of business.
Steinmark, been in business forever, goes out of business. Pier one, Montgomery Wards is in trouble. J.C. Penney’s is in trouble. Jeanne-Marie goes out of business. Godiva chocolate closes down fifteen hundred locations. GNC closes down nine hundred locations. You know, Blockbuster went out of business because I saw Netflix. I saw the writing on the wall that opportunity by Netflix. And they did nothing, nothing at all and end up going out of business.
That’s the big public companies.
What you’re not hearing about, all because the media doesn’t talk about it. All the private companies on every street corner, in every town, in every state across our great nation, these business owners are all going out of business. They’re exiting poor, not rich. Like my book says, they’re selling for pennies on the dollar. They’re closing our business and many of them are filing bankruptcy. And they’re losing not just our business assets, but the person wants us to because most business owners pierce that corporate bell.
So why is that? Why is that? Well, I’ll tell you why that is the number one reason why the business landscape has changed and flip flopped before the pandemic is because business owners stopped doing one thing. They stopped doing a lot of things.
But the biggest thing is lack of aim.
Aim is always innovate and market, always innovate and market. And many of these business owners get stuck and their ideas of the way they started their business. And they want to do things the way they’ve always done them. You’re either growing or dying. There is no in between growing or dying like Blockbuster did nothing different. Toys R US did nothing different in seventy five years. So business owners have to continue to innovate. If you don’t innovate, you will die.
If you don’t innovate and market, you will die. So to answer your question, I educate business owners on, OK, this is how you started your business. This is the basis of your innovation, but you haven’t done anything new in 20 years.
And here’s the bottom line.
Consumers don’t purchase products and services the way they used to. Whoever makes it easier for the consumer to do business with is a company that’s going to win.
Amazon is winning because Amazon.
Amazon doesn’t really innovate. Think about it, what does Amazon do they make it so easy for the consumer to purchase products, you can practically buy anything, including a horse, and have it delivered to your house in two days.
So not only do you have to innovate, you have to go back to the consumer and ask the consumer, what do you need? What do you want? How can I make it easier for you to do business with our company? Business owners stop innovating, they stop marketing, and most importantly, they stop asking the customer, the client, the consumer, what do you need? What do you want? Or be preemptive and figure out what they want, what they need, like Steve Jobs did.
Here’s the other thing. If you’ve been in business 20, 30, 40 years, your customers are probably aging out, right? You’ve done nothing new and nothing innovative in which to keep those consumers doing business with you.
But more importantly than that, going after the other generations, Generation X millennials.
Right, yeah, now this is interesting and like the statistics you talked about, like there’s a definite a total inversion and unfortunately people are still hung on the metrics they remember they know the stats of yet 95 percent plus of startups will fail. We still quote those numbers.
So it’s it’s wrong, right?
This is this is the horrifying thing about, you know, in the same way people always say you never get fired for buying IBM. I know 11 people that have been fired for buying IBM. It’s because in the end, the week we take this kind of like withI sort of stat that we can have and it outlives its reality, so. What’s missing, Michelle, because you’re you’re in front of the stuff all the time, like how is the how is the market and definitely the media, you know, not grabbing on to this story and talking about it because it’s a huge opportunity for folks to get started.
And that’s what’s so shocking to me, too. I’ve had this conversation with my publicist. Why isn’t the media talking about this job? And he’s like, because it’s not big news. Toys R US is big news.
Kmart goes out of business.
Big news, Godiva closing everything on location is big news. But the private company now has one location that’s been in business for 20 years. Who cares? Media doesn’t care. It’s not big news for them. And so nobody’s really talking about this stuff. That’s why I wrote Exit Rich. That’s why I wanted to start the conversation.
That’s why I wanted to really help as many people as I can. You know, I’ve been on over to on a podcast in the last month or two so that I can get the message out there that so many businesses are failing. And these are the reasons are valid. I mean, small businesses, the backbone of our economy. There’s thirty point two million businesses in the United States employing over half the US workforce. If we lose small business in the United States, we lose jobs, we lose jobs, lose spending power.
You’re spending power. More businesses shut down. It’s a domino effect. You lose even more jobs.
So if we don’t get behind small business, help small business owners, help entrepreneurs, stay successful, build a sustainable business that’s scalable, that is sellable, one day you’re going to have more and more and more bankruptcies, I mean, over more bankruptcies and twenty nineteen even before the pandemic than in any other year.
Well, and that’s that’s always the the interesting thing, and of course, through the course of the pandemic, the world has been shaken up and and it’s hard for us to measure, you know, when the effects will be felt. But this is an, again, interesting that you brought up. Right. Like the bankruptcy said, ridden, but had risen to incredible levels, pre pandemic. So this was already in play.
And people don’t see that.
They just look and say, oh, well, of course, bankruptcy went up.
We’ve been in a global pandemic like, no, no.
This was the the writing was already on the wall.
Yeah. All these statistics have, according to you, is right before a pandemic is even more gloom and doom now. But I mean, you do have more and more businesses have started up in twenty, twenty than any year before.
And some of these startups are really doing well. And like I said, startups only have a 30 percent risk of going out of business. Now, the big difference between startups now and startups before the pandemic are a lot of these entrepreneurs are solving problems.
And they’re not just opening up another coffee shop on a block where you already got six coffee shops or another ice cream ice cream store on a street when you already got 10 other ice cream stores.
They’re actually solving problems or doing online, you know, open up e-commerce businesses, manufacturing, online businesses.
You know, they’re really solving problems. And that’s what entrepreneurship is all about. It’s not just about over another ice cream store and cannibalize in the marketplace. It’s about going out and figuring out what the problem is and then coming up with a solution. That’s what entrepreneurial ism is all about.
It if you look at today, you know, the the the the needs to build a start up and sort of the the capital impact of so different than than they were when, like a 10 year old business, even especially 20 year old business. Right. To to build a company today is, you know, an online process. And, you know, it’s you know, how exciting is it to like what we’ve got ahead of us right now, Michelle?
Like, you can just you can come up with an idea, you can build a business and you can be online before the day is done. Yeah, it’s so exciting because, you know, when I started, gosh, when an online bubble start, what year was that?
The first one. Right. The two thousand and one dotcom one.
Yeah. Yeah. Nowadays is so much easier to start a business. I was talking to a gentleman in Australia yesterday. I was actually on his podcast and he’s like, oh, it’s so easy to start a business. I think he’s got like one hundred online businesses and it really costs you nothing.
And you don’t necessarily have to have employees or assets or inventory. I mean, you can pretty much start an online business without investing too much and be really successful. Now, turning around and trying to sell that online business might be another thing. If you don’t have the solid infrastructure and you don’t have the business built on what I call the six PS, then you might not be able to maximize value. But anybody really. There’s not anybody. Let me not say anybody any you know, somebody who has that entrepreneurial spirit, really, it’s much easier now to start a business than it’s ever been before.
And I think, you know, again, the bottom line is look around us, figure there’s opportunity everywhere, you know? But unfortunately, there’s also people walking around like zombies that they’re not really, you know, conscious and not really looking at things and and thinking about things about what can I do, how can I solve this problem?
And some of the best entrepreneurs in the world are the ones who solve the biggest problems.
And entrepreneurship breeds entrepreneurship, like, you know, I have a coffee shop store, right leg, an online coffee company that I built on Shopify. So because you.
Yeah, because so because the people who built Shopify solved a problem that needed to be solved. And as a result, it allows me to solve a problem that needs to be solved. Right. And and like I somebody wrote a tweet the other day and it was it’s it was unfortunate the way that the response was. They said, look, you can start a business today for under 500 dollars like that. And it’s a wondrous time to be able to do this.
And a lot of people like replied back in a really negative sort of sense of like, this is not true. You know, I’m like and I I didn’t even want to get in the conversation like, no, I legitimately started a business for seventy dollars and it has immediately become profitable. So it’s and it is totally possible to do this stuff, which is why I’m excited. But I’m curious on your thought, Michelle. Where do we need to bring this, like, is this something that we’re missing in education, like in like getting people to recognize that this is a new way of building society and, like, opportunity?
Yeah, I want to address up to two ways. I’ve had many of these online companies come to me.
One was a coffee company and not yours.
And now they’re not for sale yet.
But the problem is with some of these online, a lot of these online businesses is they don’t have any infrastructure.
They don’t have any people, you know, and if you go to my six PS, which I think we should, that’s in my book and to educate your listeners, you know, the number one is people.
And this this coffee company and people that have subcontractors and they didn’t want to let their subcontractors, independent contractors, I’m sorry, independent contractors go along with the business because I want to keep those independent contractors for the next on line business.
So that’s a problem when you’re building a business, any business, whether it’s online sales, business, brick and mortar, you got to have an infrastructure if you don’t build it with an infrastructure. Number one, how sustainable are you really going to be? And can you scale? And more importantly, can you sell and maximize value?
Yes, maybe you can sell to somebody else who wants an online business and are going to work that business as their job. But you’re never really going to be able to maximize value because you don’t have people you don’t really have the infrastructure of what a business really operates upon. And so you’re really never going to maximize value. So all businesses SACE online, brick and mortar, all businesses need to really follow the infrastructure that I talk about in my book, Rich.
That, to answer your question is where do we educate these people?
I think it starts in school.
You know, it needs to start in school. I’m educating my daughter. You know that you want to make money. You don’t just go work for money. Let’s get creative. Let’s get entrepreneurial. That entrepreneurial spirit. What can you do? Well, you got all these toys sitting in the attic. Why don’t we box up those toys and sell them?
Yeah, we can sell them or, you know, we can donate them. But anyway, we really got to get our kids thinking about entrepreneurship early on. And I’m not sure if I’m answering your question, but, you know, I’m actually interviewing Indoctrinated Cobain later today. And he is president of Lazy Boy, I think Panera Bread Company and about a bunch of other companies. And he’s also president, my high point university. And the Virginia campaign has probably got one of the only schools that I feel really teaches entrepreneurship, has business, has classes where they teach you how to go out there and start a business by business.
You know, what business ownership, what business entrepreneurship is all about how to go out and solve problems. And I think it just starts as our kids are little to start teaching them. Kind of like Richard I bought out by Robert Kazuki, you know, just really teaching our kids to think differently. It’s all about really thinking differently.
Well, and even the the opportunity today, like you talked about before, like this is this is an incredible world that we can do things in a different way, even if we look at some of the sort of the even rich dad, poor dad as example, effectively needs a new addition because the world has adjusted. Right. There’s other folks that are, like we call it, the new rich writers. Yeah, it’s we didn’t hear there was no Bitcoin back there.
That’s right. Russia for Florida was right. And, you know, I’m so fortunate that Sharon Lechter, who coauthored which Jeb fought out with Robert Kiyosaki as my coauthor for my book, Exit Rich, because Sharon Lectors, a New York Times best selling author, five times from a shepherd, plus a CPA financial literacy expert and adviser to many different presidents.
And she teaches financial literacy as well. But, yeah, they need another version because there’s there was no online back then. Know there was no Bitcoin back then.
There there were there were not a lot of things. It’s so much easier now, I believe, to become an entrepreneur than ever before.
And even if we look at it like great books, like Built to Last, which were used as effectively like a tome of describing the potential for for taking on a blue ocean strategy in an opportunity. Well, if you look at almost every one of those stories effectively turned over and they’ve actually shed that portion of the business in order to survive. So that built to last wasn’t built to last because the world adjusted, you know, no offense to course, Jim Collins and the folks that did it, it was at a point in time, if you take the context, it was right.
But we have to adjust context to availability of the world today. Right. Right.
So let’s you talked about the the the peace, right, so having six method people is number one, if you don’t mind, Michel, let’s kind of brush through what the what the six message.
And I spent a little bit of time on people because this is where a lot of e commerce businesses, online companies, are getting it wrong. You know, and you got to you don’t look, you don’t build a business, you build people and people build a business. Right.
If you want a business that’s going to be sustainable, scalable and one day sellable, you do have to have the people in your organization. And a lot of online businesses have independent contractors, but they love their independent contractors, so they want to keep up its makeup. So the next new, you know, business that they’re building.
So you really have to have that people component. You always say that entrepreneurs. And that’s one reason, you know, that that coffee shop, they wanted a lot of money and the coffee business, not coffee shop, coffee business, they wanted a lot of money for it, but they had no solid infrastructure. And it’s only been in business for a few years. So there really wasn’t much history there. Does that make sense? Yeah, no.
We’re talking about how an exit, which is all about business as a sustainable business, as scalable so people is huge. You know, a lot of entrepreneurs, they want to do everything themselves. They want to control everything. And I always say you can’t grow unless you let go of the control. So entrepreneurs really need to focus on their strengths, how the weaknesses. But the biggest thing is put the right people in the right seats. And if you are building a business to sell and not just run your business to pocket as much money as you possibly can, then build that solid infrastructure and then the people you really need to ask the question who you know, who handles customer service, marketing, legal, accounting, manufacturing, distribution, environmental, etc.
. The list goes on and on.
The clue, Eric, is that you should never be next to the WHO because you really want to build the business without you. A lot of these online these online businesses, e-commerce businesses, they don’t have any people, right? They don’t. And that makes it very, very, very difficult. A harder to sell because the buyers who are going to pay the money that these e-commerce businesses want because they want a multiple of their EBITA, which is understandable, but but the buyers are not going to run that business.
So you have to have the people in place that been running the business are going to continue to run the business and you can’t just take your people with you and leave the business people because now you have no business. Does that make sense? Absolutely.
And it’s it’s I’m very close to this as I look at like, how do I build this for scale? And you can see how the trap is easy to fall into of like, look, I can just do more stuff and subcontract it out and I can hire people off up work. I can do whatever. Yeah, but that doesn’t build sustainability and it ultimately doesn’t build long term value in what like measurable, you know, sellable value even as measurable growth value.
It’s it’s it may look like it’s working because the graph seems to be going up into the right. But the moment you break the system, the moment you slow down or change. Everything can go in the wrong direction, right, and then let’s say you have independent contractors and subcontractors, Eric, and you’re paying them this, but then the buyer says, I really like the business. I like what you do, but we need to have employees.
Employees are going to cause this.
So that’s going to automatically subtract from Ebola, which is already differential taxes, depreciation and amortization. And that’s going to lower your sales price immediately because buyers pay a multiple of EBITA. So you really got I don’t care if it’s an online business. I don’t care what kind of business it is. You got to build the infrastructure, you know, and that’s why so many of these e-commerce businesses are not selling. Or if they are selling, we’re not selling for maximum value.
I could sell them for a lot more if I had a solid infrastructure in place.
That makes sense.
Absolutely now and this is a good lesson for folks, and I’m always amazed, too, when you look at the like you look at these different sized companies and different e-commerce businesses, you have to very much use that lens to look at how they grew to the point where they’re at today.
Because, you know, look, Facebook has grown with independent contractors and subcontractors actually giving Google has gone with independent contractors and subcontractors. You know, Facebook does have companies that they contract with that have the employees employ the employees, but they still have people, you know what I mean? And I still have a bunch of subcontractors and independent contractors that come and go. So any of these businesses you look at, they have a foundation, they have an infrastructure.
So people is number one.
Number two, because here’s the bottom line, too. If it’s just the owner, like in this coffee business that really was just the owner, they wanted to take everybody else with them, you know, and buyers and buyers don’t want a job. And so really, that really is a job. And many business owners, instead of creating a business, they’ve created a glorified job and wants to go to work at every day versus a business actually works for them.
So people’s number one product is number two.
So product is your industry, your product. It is your service. You have to ask, is my industry product service on the way up all the way out?
Meaning to. Do you have an Amazon at the prime of your game or do you have a blockbuster and you’re about to go bust? And so product is huge. You know, there’s a lot of industries that were dying before covid that are now crushing and vice versa, those industries before Kova that were killing it and dying.
So I always tell my clients to ask these three transformational questions during product because remember, 70 percent of businesses are going out of business, have to be in business 10 years because they stop innovating. In order to innovate under product, ask yourself these three questions from a one. What business are you in this in the 90s, is that some sense, what business, what we had and I said, what?
Booksellers will fulfill book orders. And then Amazon said, this is a question your own or your listeners, not your owners. Your listeners are asking, what is your core competency? What do we do really, really well, better than everybody else. What is there a USB or unique selling proposition? And Amazon said. We do fulfillment better than everybody else. So then the third obvious question is, what business should we be in? Should an Amazon said we need to be in a government business, not just for selling boats, were selling everything for everybody.
Now, Amazon is not really a huge, innovative company, are they? What have they made? What have they innovated?
It’s it’s there are things, but in effect, they’ve basically they just they took on processes that nobody else wanted to take on, processes that nobody else took took on. They figured out what they were really good at, which was fullfillment. They’re not out there making the widgets. They’re not manufacturing and widgets. They’re not creating, you know, the next the next best cell phone. They’re not out there creating.
They’re out there fulfilling what everybody else creates. Yes or no.
You know, those transformational questions is really what transformed Amazon from a small bookseller to a multibillion dollar worldwide conglomerate that they are today. You know, my good friend Jeff Hoffman was standing in the airport line to try to to get his boarding pass so he could board his plane. This was decades ago. And he said he waited almost two hours to get to the agent to hand in this little, teeny thin piece of paper so he could get on the plane and just said, I just missed my plane, has handed me a piece of paper and Jeff went out and created the airport kiosk.
The kiosks approach your boarding passes so you don’t have to wait in line and miss your plane. That’s innovation. But as in the case of Amazon, you don’t always have to be the creator. You and now Amazon is the creative fulfillment, right, because they do it better than everybody else, but that’s what that’s what the essence is back in the 90s. What do we do so well is that we do that and that’s how they got so big.
So all business owners really should go back and ask themselves three questions. I don’t care what vertical you’re in, e-commerce businesses. You know, ask yourself, what business am I in, what I do really well, better than everybody else on my business, should we be? In some sense?
It does. It does. And then it’s interesting that they’re there. It always sounds simple, but it’s a very difficult, introspective thing for a business owner to do to really evaluate what’s the actual business where we’re in and what’s the thing that we can do. Right. And it really it really is. And a lot of times, Eric, you have to have an outsider’s perspective, because, like I said, when you’re in your fog, it’s foggy.
And a lot of business owners are transactional versus transformational. They’re are working in the business in the day to day, putting out fires constantly that they don’t really have time to sit there and think about what this is. I am what I do really, really well. And did you ever watch your movie, The Founder, based upon the McDonald’s?
Yes. Yeah, yeah. It was Michael. Michael Keaton was the star that we had. Really, really good. Good movie.
You remember when Michael Caine and Ray Kroc was in the bank trying to borrow money? Because he had already taken a mortgage out on his personal house, right?
He wasn’t making any money.
And it makes you like I’m like a legend. More money. He walks out and then a gentleman that followed him out of his name, he said, What business are you in?
And I said, I’m in the restaurant business right now. All right. What business are you? And he finally said, you need to be in the real estate business. You are not in the restaurant business, not in a hamburger business. You have to be in a real estate business. You have to buy the land, build the buildings, listen to the franchisees or franchisees are not compliant. You avoid our franchise agreement and you get another franchisee in there.
And then these franchisees are paying you rent. Those questions right there is what got Ray Kroc to have the leverage over the McDonald brothers to basically take the company away from them. But is the reason why McDonald’s is the largest holding company, real estate holding company in the world? So a lot of times you get a very a very valid point, Eric, is that. It’s hard for a business owner to have the infrastructure to do that themselves. You’ve got to have an outsider’s perspective like Ray Kroc that require would have never figure that out on his own.
And the interesting thing, too, and we look like let’s take the the greater story out of it, but like in general, so the like that business effectively was became what McDonald’s was, not what it was built from because they couldn’t answer those three questions. I don’t think like they they didn’t have the vision to do this bigger thing versus now, Ray, through this also third party help was able to really see what the future of the growing business is, which is and it’s funny, like brothers, the two brothers did not want to let go of the control and will never grow without letting go of the control.
The reason is that they tried to have multiple locations, but they wanted to control everything and then they all fell apart. So they’re like, OK, we’re just going to focus on our one restaurant, but you got to let go of the control. You got to get good people. You got to get good integrators. You go back to the people. You don’t build the business. You know, people may the business right. Got the right people.
I can’t do it all by himself. Right. So the therapy is processes, and I can still use a founder movie based to illustrate processes, you know, because back in the 50s, most business owners get this wrong. Most business owners design the processes around their own agenda, not around the customer experience.
MacDonald brothers back in the 1950s said, We want to build a fast food restaurant. We want our processes to be centered around, be designed with the customer experience in mind. So do you remember when when the McDonald brothers went out to the empty tennis courts? That’s right. Employees to talk through it all on a tennis court. How their employees moving around, bumping into each other. One of the McDonald brothers was on a ladder, really orchestrating how they move and kept redesigning it until they really had a symphony of systems and processes designed with the customer experience in mind.
The customer experience the McDonald’s brothers came up with, as we want our customers to experience great tasting food.
That’s hot, fast, 30 seconds or less. Even of those processes were designed back in the 50s and tweaked along the way, you can eat at a McDonald’s anywhere in the world and really get the same experience. Yeah, right.
Have you ever dealt with a company? We have to talk to three people, four people, 10 people to tell them the exact same story of your problem to try to get some resolve. Banks are notorious for this. Pharmacies, retail, social media companies are notorious for this, that they are not designing the processes with the customer experience in mind. They’re designing customers to alienate US and business. And here’s the bottom line, if you don’t create raving fans, then your competition will.
And you’re not going to create raving fans by having broken processes not designed with the customer experience in mind, so processes must be designed with the customer experience in mind and must be productive, efficient. And they must be well documented policy and procedure menus, McDonald’s can fire somebody on the front line and hire somebody within 30 minutes, have them working because they have S.O.P checklist is easy to follow, understand and implement. So you’ve got to have this policy procedure manuals as a checklist, employee handbooks, non competes, you know, all the documentation.
You never sell the business with all this documentation. Plus you need it to scale. You’ve got to have these processes to scale. So the fafi and this is the highest value driver, Eric, so businesses have it even under a million dollars? Well, typically sell for one the four times multiple. Probably one to three, more like it, just as well over a million dollars in EBITA, which could go for four or five and up. However, the more proprietary assets you have, so the fourth is proprietary, the more proprietary assets you have, synergies you have, the more we can sell your company for a get you a much higher value.
There’s six pillars to proprietary. No one is branding the mobile brand and your company as and what I can sell it for as long as your brand is relevant in the mind of the consumers. Is Blockbuster relevant in the mind of consumers is anybody can pay money for blockbuster brand. Now, because they went bust, raising them, their most valuable brand in the world is, do you know, the biggest brand, the most valuable brand in the world is?
That’s a good question. I mean, it’s funny, I’m looking at a Nike square in the back, there’s an example of someone that jumps to mind. But I mean, they’re not wearing a top 10, but they’re not the most valuable. Yeah. Oh, boy, we’ve mentioned it several times on the show today.
Oh, my, it would be our friends at Amazon.
Apple. Yeah, yeah, yeah, yeah.
I look at a MacBook and an iPhone and they all surrounded by Apple devices. They’re actually such a part of it. I wouldn’t think of going outside, but it’s funny that is that is hugely a brand impact, right?
It is. I mean, the brand alone is worth two hundred fifty five billion dollars billion. That’s just a brand. That’s not the assets. Demitri Cash. Well, real estate receivables, that’s just the brand alone. So build your brand. And then the other thing is trademarks. Trademark your company name. You know, trademark your slogan, your trademarked exit, rich.
Yeah, you know, trademark your podcast.
But here’s the big mistake the business owners make when trademarking. They go and they get a trademark for the state that they’re setting up the business up there in California. They start a business in California and get a California trademark, but then they go to GoDaddy. They make sure they get that dotcom, but they never check the federal database to make sure that that name is available. Right. And I’ve seen clients in business for years and all of a sudden receive assistance, this letter, and they have to stop using that company name.
And, you know, I’ve seen clients hiring attorneys with lots of money and ended up losing. So go spend fifteen hundred to two thousand dollars and protect your proprietary stuff. You know, and even products are not just your name and slogans and what’s unique to you, even products and have clients. His business for selling the 50 to 60 million dollar range. They have 12 different products. Each one has a different federal trademark.
Each one is exclusive to Wal-Mart, exclusive to Target, exclusive to different retail chains. So TJX will pay more money when buyers are five different types of buyers. When buyers look at buying businesses, they look at synergies. What synergies? It’s going to catapult my current business to the next level. They’re buying synergise. Patents are huge, if you’ve ever watched Shark Tank, every single shark always ask. Get a patent on that, do you have a patent pending?
Do you have a utility patent? In fact, offers are contingent upon patterns of business for 18 million dollars. And that business was was not really making money, but they had 18 hands on drugs or another one. That’s really big manufacturing contracts, distribution contracts. There’s another thing about e-commerce business.
It’s online businesses.
They don’t have people. Some of them have processes, it’s iffy. Most of them never, ever have contracts like coffee cup I was selling at a manufacturing company, no contracts as somebody else making their coffee. No contract.
You know, you really need those contracts. So you have protection. And the buyer buying the business knows that this manufacturing relationship can continue on. This distribution company can continue on. Does that make sense?
Drugs are huge. You know, vendor contracts, distribution, manufacturing, any type of exclusive contracts. Franchise owners who have franchise contracts are really valuable. Client contracts are extremely valuable because buyers want to make sure that there’s revenue coming into the business, especially the contracts. And e-commerce businesses are good at this, getting a subscription model for reoccurring revenue. And when you have reoccurring revenue, I will pay a higher multiple for subscription models. Here’s a caveat to contracts.
I have never met a business owner in over 20 years that actually has the transferability language in their contract that says this contract is transferable to the new entity.
And about ninety nine and about ninety ninety nine percent of all sales in the United States are asset sales, not stock sales. And so if your buyer refuses to do a stock sell and your and your clients refuse to do consent to transfer, your job can fall apart. So you need to make sure you have that transferability language. The other thing is database’s Facebook page, 19 billion dollars for WhatsApp and WhatsApp was hemorrhaging.
Yeah, they were not they were not profitable on that.
They are not profitable. And they were hemorrhaging, but they had a billion users. So they had a synergy that Facebook wanted to buy. Facebook knew they can monetize in order. Why that investment?
Celebrity endorsements are big. You know, if you look at rooms to go, who’s a celebrity there, Cindy Crawford. Have you ever seen her in any of the furniture company? No. And then we have a client who’s got products endorsed by Oprah. Well, Oprah is like the queen of everything.
So strategics, who have some more products, will pay more money for that Oprah relationship because, you know, it’s all about relationship capital because they want to get their products in front of Oprah. Same thing with radio personalities like Glenn Beck. Know the cake product show.
Yeah, these these celebrities and radio personalities can only endorse one vertical at a time. Otherwise they lose credibility. Jennifer Aniston’s face is all over Aveeno. You don’t see her face on any other skincare line, right? And then e-commerce businesses back to my e-commerce businesses, when they have the top positions on Wayfair, it’s Etsy, Amazon, eBay, Monan that shoots up in price because as prime real estate, the strategics want to get their products and those placements.
That makes sense.
Yeah, the new real estate is placement on page and in research results now instead of just physical location in the town.
Absolutely. Probably even more valuable than physical location in the town. That’s where that’s where consumers are shifting to, because most consumers, you know, because of Amazon, whoever makes it easier for the consumer to do business is it companies is going to want Amazon wins because they make it so easy. But the pandemic has also changed the way consumers purchase products and services now. Wal-Mart and Target did not have a membership in a program where you can order online and to deliver groceries to your doorstep is because Amazon acquired Whole Foods and Whole Foods has that program.
You know, the interesting thing, too, and like you talked about the you know this, every business is now a global business in effect. And what we try to be like those these brands are are no longer like the reach is not limited, but nor is the they have to effectively go beyond their streetcorner. You know, it’s it’s almost a responsibility as a business to be able to go, yeah, there is no limit anymore where you can do business.
The limit is right here in your mind.
FFP, I’m sorry, go ahead.
Yeah, no, sorry, I just realized I, I wanted to double check because I know we talked about so we’re five peas in.
And first of all, like I say, Michel, this is incredible.
Like, this is if anybody hasn’t already started writing this down, number one, they’re going to buy the book. And if they don’t, I’ll buy the bloody book for them. They need to write a fantastic book.
But like you are, you are sharing a ton of really, really strong lessons here. And I want to thank you as we’re going through this, because it’s it’s it’s a rare treat to have somebody that can really be, as you know, informed and share as much, even though, you know, obviously there’s a lot more that’s in the book than just simply listing out what we’re talking about here.
Right. Thank you, Eric. And so the fifth is patrons, patrons is your customer base. And most businesses follow the 80 20 rule where 80 percent of their business comes from 20 percent of their clients.
And you’ve got to be very careful on customer concentration. What you really want is customer diversification and e-commerce businesses get in trouble doing this as well on. Coffee company Dow is talking about ninety nine point nine percent of all the sales came from Amazon. What happens if the relationship with Amazon fails? Then they just lost their entire business, so it’s not just, you know, customers that you have customer concentration and it’s also the marketing channel that you’re using. And if all of your sales are through Amazon now, I know there’s a lot of Amazon sellers out there that only sell on Amazon.
And that’s OK, but it’s risky when I looks at that they’re going to want to mitigate the risk because what happens if Amazon decides? Not to do business with you, right, or Amazon decides to get in the business you’re in and effectively evacuate that channel for you now. Right, exactly.
So you should always be diversified in your client base and how you get clients. So if you’re getting all your clients from Amazon, I’d be very careful. You need to have multiple concurrent resources like your own website, you know, like maybe Etsy or something else. You have to have sufficient resources course being in the grocery store, et cetera. So anyway, this is customer concentration we want. So I’ll just give you a quick case study.
We had a business or manufacturing business we were selling that has 70 percent, 60, 47 percent of the revenue tied up in the BP contract. We appraise this company for nine point eight million.
We had over five hundred and fifty buyers.
We narrowed it down to 12, Alawi’s a lot of intense. Every single letter of intent had a condition in there that if you lose BP, then we’re not paying you. This isn’t this and that’s because we’re going to mitigate the risk.
However, we found a strategic that very similar products and services in a strategic. Didn’t care about the risk because the reward for them was far. Greater on the upside, because they’ve been trying to get their products and services into BP for decades and never could get their feet in Utah, it’s like, oh, this is perfect. We’re in there with this company we just acquired. Now we can get our other products and services in there.
Does that make sense?
Yeah, they were willing to pay 15 million for a company that was a price for nine point eight. Fifty million for 70 percent of the business, which is one hundred and twenty six percent more than that price price for the company for 70 percent. So we can sell a business with customer concentration. It just makes it much more difficult. We have to find a buyer of a needle in a haystack type of situation.
Yeah, that was a real unexpected value, but it’s an important one. It’s it’s hard to match those. But and also as well, like you talked about before, like the the outside view in is the only way in which they will discover that, because if they are simply looking at their own internal channel, that’s all they can be focused on. How do they possibly seek out a buyer who’s looking for a bidirectional access to the channel and sees a greater value than they even realize they’ve got?
So that’s and sometimes it doesn’t always work out. I think we had we had a media marketing company that were selling 10, 15 million range. They have five clients are only five, and they’re in the process. They lost two of the five. And the reason they have five is because of were casinos that cater to casinos and in marketing for the casinos.
It was so such a risky business because casinos will do the math. They bring on a new, you know, a new agent that makes the decisions and they will do the math and say, oh, we can do this in-house cheaper. And the marketing company. So they lost two clients out of the five. The revenues dropped in half or even have dropped in and they were no longer sellable. I ended up having to merge with another media and advertising marketing company.
So it doesn’t always work. How do you want to make sure you have customer diversification? And then the last piece, the most important thing, all entrepreneurs is profits. And I was like, Michelle, where do you put this last? The reason for profits last is because of that lack of profits is never the problem. Lack of profits is never the problem if you’re not making money. Lack of profits is not the problem.
It’s a symptom.
And the operating on one of the other types of clients that come the mail is that much of a profit problem. I’m like, no, you have a people problem or no, you have a process problem. You don’t have lack of profits is not a problem. It’s a symptom.
If you are running your business on all five PS, I can promise you you’re going to make money.
What’s that was a great example of never far from profit, they were as far from profit as you can get while still be considered in a business worth buying. But they had of the other five fees and majority of what was needed to bring value to their buyer. Right. That’s incredible.
That’s the sixth phrase. That’s your infrastructure. And you can see there’s infrastructure on the six fees. I can work for e-commerce businesses, right? Yeah.
Yeah. When it’s and it’s amazing. Like you said, it’s these practices apply to brick and mortar. They apply to e-commerce. They apply to locals to global site there.
It’s that’s right.
The methods play out and the importance is you have to just look at the overall methodology and make sure it all comes together. So like with that, I know, Michelle, we we’re coming up to time. And this has been fantastic. So Exit Rich is I highly recommend people people need to get this. If you’re at all involved in business, even if you’re not thinking today that you’re building towards exit, we have to understand we all are right.
The viability and sustainability is maybe your exit, maybe it’s your own personal exit. Are you creating something that’s sustainable to be worthwhile to the next person that’s going to take it over? Even if it’s not necessarily a sale, it could be the next CEO.
So we’ll have links to get get the book and Eric and I tell everybody the value that they get paid by the state.
Absolutely. That would be fantastic. Yeah.
And I’m sure your listeners want to hear about the extra gold nuggets, extra value we’re offering.
I like this even better.
So it’s so Rich launches in June towards the end of June. And Steve Forbes has endorsed the red state as a gold mine for entrepreneurs, as most entrepreneurs live way too much money on the table when they’re selling their business. Kevin Harington original Shark on Shark Tank wrote the foreword lectures my coauthor. So you don’t have to wait till June to read exit rate. You can go to exit. Which book?
Dotcom now for twenty four dollars and seventy nine cents, which is less than Amazon.
We will email you to digital download so you can start reading today. We will send the hardcover to your doorstep to anybody in the United States for no additional shipping cost.
We will give you a lifetime membership into the book club where there’s video content and made doing transformational questions and talking about strategies and techniques and doing deep dives in all these different things that I teach over the last 20 years, plus documents, documents to run a business necessary business. We have simple employee handbooks, not Kupets or charge licensing procedure manuals. We also have sample letter of intent. Purchase agreements, due diligence, checklist, closing documents, all of these are there not just for review, but you can download the templates and start using them.
If you want your attorney to try to recreate all these documents would cost you over thirty thousand dollars and all available to you just for buying the book at twenty four dollars and 79 cents.
Plus, we’ll give you a 30 day membership into Club CLS, which is an entrepreneur mastermind that we started to really help business owners build that sustainable, scalable and when already sellable business so they too can get rich. And that’s an rich book.
Dotcom, if there’s if you if you got twenty four, seventy nine to spend, which everybody does, then go, go there.
Yeah. Because if you’re going to McDonald’s save you save the burgers by the book.
Save the Quarter Pounder with cheese.
I can probably say I was lucky enough and thank you to your team actually sent a preview and I read it. It’s fantastically written, beautiful lessons. Like you said, you and Sharon did a great job and coauthoring this and like the book alone, well worth the value that that’s attached on that cover price. But the fact that you go far beyond it with what you’re giving and sharing, I really appreciate it. So, yeah, definitely folks do do go there and get the rich book.
This is this is a must have. And like I said, it’s it’s a manual that everybody doesn’t even realize they need until they start to read it. And don’t don’t wait until you’re looking to sell before you start to try and look backwards at what you needed to do along the way. It’s it’s like a manual for success.
So thank you for for bringing this to market.
Thank you. Thank you for having me. Eric has been an absolute pleasure. My main website, if anybody wants to contact me, Michell at SeilerTucker.com and then https://ExitRichBook.com.
Excellent. Yeah, I’ll make sure I got links to the show, notes. Michelle Seiler-Tucker, this has been an absolute pleasure and thank you so much. I appreciate it. And I wish you all the best. With the official launch in June. I’m looking forward to my hard copy cover arriving at my doorstep so I can put it on the bookshelf, but I’ll read it from end to end in the meantime anyways in advance, because it’s it’s an absolute must read for sure.
Sponsored by Diabolical Coffee. Devilishly good coffee and diabolically awesome clothing
Dan Burcaw has founded companies on the forefront of profound technology waves: open source software, the smartphone, and cloud computing. He describes himself first as a serial entrepreneur; a repeat startup founder and CEO with his latest company being Nami ML.
We explore a deep discussion around how leveraging services and systems to let your teams do what matters is both powerful in business and life. We also talk about how Dan has created and operated his companies and some great personal insights into being a leader.
Sponsored by Diabolical Coffee. Devilishly good coffee and diabolically awesome clothing
Eden Green Technology is a vertical farming technology company. They build, manage, and license a greenhouse technology platform that increases local access to nutritious produce, and provides a non-interrupted food supply, all through its turnkey urban agricultural model.
Eddy shares the values, outcomes, and vision of why he joined Eden Green and also what drives him to do good as a leader with Eden Green and Buzzshift, his digital strategy agency.
Sponsored by Diabolical Coffee. Devilishly good coffee and diabolically awesome clothing
Emily Omier is a Positioning Consultant who helps companies confidently give their product a label and focus their marketing and sales on the types of companies and engineers that will value it most.
Emily’s knowledge and experience in successful positioning and product market fit for open source platforms is something that makes this a real must-listen as we explore so much of the world of product management, product marketing, and much more.
[00:00:00.780] Hey, everybody, this is Eric Wright, the host of your podcast, and this is a really, really great episode, talking about the value and business of open source and in fact, it talks about product management.
[00:00:12.420] Good golly, there’s actually so many incredible lessons in here. So hang tight. But before we get started, I want to make sure I give a big thanks to our fine friends and the sponsors of this episode, which include our Friends at Veeam Software. So everything you need for your data protection and disaster recovery needs to vee.am/discoposse
[00:00:31.440] They got a really good deal that they’re able to get you set up with. Most importantly, you can actually either just grab it on the spot or get connected with them and let them know that you came from here. They’re longtime friends. So whether it’s your data on premises, whether stays in the cloud, whether it’s virtualization, physical servers and even your cloud native with the Kasten solution, very, very cool.
[00:00:52.840] Wants to check it out to go get our vee.am/discoposse. All right. Next up.
[00:01:00.540] Oh, I love coffee. Did I mention that I love coffee? In fact, I love coffee so much that I bought a coffee company. So if you want to go and check out the coffee brand that’s going to take over the coffee world or at least play a major part in it. You can go to diabolical coffee dotcom the sponsors, because, hey, I want to make sure that I share really, really neat stuff for doing so when you actually buy coffee through diabolical coffee, dotcom coffee and we got really cool swag, wicked great T-shirts, they’re devilishly good proceeds from the profits do go to giving back to our community.
[00:01:34.230] And we’re going to help to create education shares and make sure that people get access to resources that they don’t have today. So please, if you want to support that, go to diabolical coffee dotcom. Also, quick shout out.
[00:01:45.150] Make sure if you want to learn how to give better software demos, go check out the 4-step guide to delivering extraordinary software demos. You can easily find that at velocity closing dotcom. That’s right. It’s a three sponsor day. And with that, let’s jump in. Emily Omier is going to join me for this.
[00:01:59.850] Emily is also a podcaster. She’s a consultant. She’s doing something that’s really a tough nut to crack and she’s doing it well.
[00:02:09.450] So she has the business of Cloud Native podcast, and she’s got a lot more that she’s doing up around speed in the sales and finding might, you know, market category and product market fit, especially in Kubernetes and open source.
[00:02:21.940] So go check it out. Here’s Emily Omier. Hi, everyone, I’m Emily Omier. I am a positioning consultant who works with companies in the cloud native ecosystem, particularly those built around or related to open source projects. And you are listening to the DiscoPosse podcast.
[00:03:10.660] Emily, thank you very much for for joining us. I was excited to get connected so I can and for folks that don’t already know, you will get into your intro. But I got to give a big shout out to Chris Psaltis, who connected us together.
[00:03:26.490] And Chris, he’s so fantastic. I had such a great chat with him. And and so he got to break the video barrier here on the podcast, which was kind of fun. And then immediately after we talked, he says, you’ve got to talk to Emily Omeir. She’s amazing.
[00:03:42.630] And, you know, so I was like, you had me at a recommendation and here we are.
[00:03:49.290] So, Emily, if you want to introduce yourself for folks that don’t already know you and we’ll talk about the open source positioning challenge and a lot more, actually.
[00:03:59.580] Yeah. So the first thing is there’s there’s probably a non-zero number of listeners who are like, I wonder what a positioning consultant is and I wonder what positioning is. So let me start there. Most. People who are non marketers might not have heard of positioning, even marketers often have sort of a distorted idea about what positioning is. Some people think that positioning some marketers, I should say, think about positioning as like a positioning statement that you that you write out and honestly is just kind of like an exercise that doesn’t end up often being super useful.
[00:04:42.470] But what positioning really is, is about creating the correct assumptions in the mind of everybody. So ultimately, the most important is in the mind of your prospects. But it’s. You don’t want to just think about in the mind of your prospects, because those aren’t the only people that matter. You also care about like what journalists who work in the industry think about your product and how they’re going to write about it. You care, if you get venture funding, you’re going to care what investors think about your company.
[00:05:14.530] If you have an open source project, you care about what the community thinks about your project, so positioning is about creating the right assumptions and it comes down to how do you describe your product? What market are you targeting? So how how do you segment your market, which is how do you determine what are the characteristics of your ideal customers? And that that’s oh, and then there’s a last thing, which is like what are the the values that the unique value that you provide and that.
[00:05:49.040] So that’s what I help companies figure out basically is what’s the best way to describe what our product is? That seems sort of basic, but a lot of founders actually find it really challenging. And who who should we market to who’s going to find this most useful?
[00:06:07.700] Yeah, this is we’re going to get into some of the neat, dirty behind the scenes work, which I often cringe even when I have to use these phrases, because one of the things that that you do particularly well is really create a human connection through the use of words that ties technology to value and human value. And ultimately through human value, we get business value as well.
[00:06:32.600] And it’s we often forget that that takes a lot of work. Right, as the old ways of the Mark Twain thing.
[00:06:39.440] Right. If I had a if I had more time, I would have written a shorter letter. We we it’s very easy for us to go on, you know, write about our story. And I’ve often done that. Right. Like, it’s you’re trying to give your elevator pitch. If it takes a hundred and twenty floor building to give you your elevator pitch, then it’s not an elevator pitch.
[00:06:58.790] You need to really be able to, you know, sort of quickly tell, hey, you know, this is this is a real problem that people have.
[00:07:05.780] You may have experienced yourself. So actually, what my company does is we solve that in a way that’s that’s actually never been done before, which allows you to be able to do this and this and this. And then as a result, then this is actually now you can get on to doing better things.
[00:07:20.030] And it’s like it seems so fundamentally simple, but it’s really difficult to do.
[00:07:26.000] And then on top of that, we then have to bring in.
[00:07:29.420] I’ll say kind of like mechanized language around it, and even you used a word that makes me gnash my teeth and I use it, I don’t even use it myself because I’ve got an allergy is the word prospekt, because I very much like I know that it’s a it’s a term it’s a sales term.
[00:07:43.900] We use it and I still fight it.
[00:07:45.580] And generally I say like prospective customer, because I know if I’ve I’ve actually had folks that are really good technical sellers and they’ll say, hey, I was talking to a prospect to that.
[00:07:56.980] And I was like, oh, that hurts just here, because I’m now I know I’m a prospect versus like I’ll say like, you know, you should say I was talking to somebody else who’s similar function in a similar role. Is you over another company or like somebody else in the community. And I get them to kind of soften the language.
[00:08:15.370] But the truth is, behind the scenes, we have to you know, we talk about prospects and and value statements and positive business outcomes and all this stuff like this. But how did you get to do this, Emily?
[00:08:26.890] Like, this is No one. No one thinks that this is a fun idea to take on, because this is a lesson in an exercise in in frustration building this stuff.
[00:08:36.970] I’m not sure that’s true that nobody thinks it’s fun to take on. There we go.
[00:08:42.280] I was just going to say that I was actually writing a blog post this morning. I found myself writing like buya no, I deleted it, but I deleted it.
[00:08:52.660] And then but it’s like I do think so. I used to be a journalist and aside and I’m also like I’m a language person. I really I also speak a couple of foreign languages. So I really think word choice is very important and. Yeah, to the point about Prospekt versus versus prospective customers versus buyers or whatever, like ultimately there is a difference between saying your buyer and your prospect anyway. So it can be really hard to make sure that you’re using the right the right words, especially when some of them are kind of cringe worthy.
[00:09:28.190] Yeah, because you have to talk about your EEB, your economic buya, you know, your technical champion. And we like there is at least sort of common phrasing. I always just it it hurts me when leaks out, you know, it’s kind of like when an internal email makes it to the outside world.
[00:09:43.940] You like, look, we know how that happens behind the scene, but then it becomes like if you’ve ever watched a rather famous bit by Bill Hicks on on marketing and he it’s a fantastic thing to listen to, not if you’re in marketing in our soft at heart, because he kind of rips that all apart. And the whole thing, he’s like, oh, yeah, this is you.
[00:10:03.740] You’re basically snakes and and demons in what you’re doing.
[00:10:08.570] But the truth is, in technical marketing and in marketing in general, it is very much about creating a connection between, you know, people value that.
[00:10:19.010] You can bring them what you can give back to them and ultimately, you know, run a sustainable organization and a business commercially through doing so. And what’s particularly interesting about your ability and your success is in doing it so far and in future, which I’m sure will be a lot of. Is doing this in open source. Very much changes because it’s much it’s a different you know, there’s a different commercial side, there’s a different value side.
[00:10:49.030] So I guess that’s the real thing, right? Getting into messaging and positioning fantastically, it is enjoyable, as neat and as challenging and then adding this like what we’re going to do to an open source.
[00:11:00.280] Projects like most would be like, all right, I’m OK, because this is a tough world to be in. Right.
[00:11:07.030] Well, so the first thing to acknowledge is that most engineers, most developers find themselves really allergic to the word marketing. I think for all of the reasons that you just mentioned, that it sort of sounds slightly dirty, and particularly if we’re talking about open source, like open source, it’s not about making money.
[00:11:30.700] So what of course, I’ll just put a caveat that that’s not entirely true. I don’t think that all open source is like completely divorced from money, but a primary function of it is not to do it, however, in order to sustain it.
[00:11:47.110] I know where you’re where you’re at with that one.
[00:11:49.780] So, yeah, I appreciate that you sort of laid that that caveat there, right?
[00:11:55.250] Yeah. So, you know, particularly with companies that I work with, they they’re related often to an open source project, but they also have venture funding. They’re also like their end goal is to build a company, not just to be, you know. Technical hippies. But so I think that’s one of the challenges when we talk about marketing but positioning. So first of all, I should actually step back. One of the misconceptions about positioning is actually that it’s part of marketing and it’s really like it’s a higher level business function.
[00:12:31.910] So, like, if, uh, if a prospect came to me and it was their head of marketing and they said, look, we really need help with positioning, I would say great. Is the CEO on board? Are the founders on board? Are they going to be part of this discussion? And if that marketing person says, no, this is not a project I’m going to take on because it’s going to fail and because positioning is it has implications for your product roadmap.
[00:13:01.940] It has profound implications for your sales strategy. You might end up changing your price point based on your positioning, because if you’re going to sell something, let’s just say you’re going to sell something for financial services. It should be expensive. And if you have if you’re trying to sell something cheap and you’re selling it to a market that expects things for them to be expensive, that’s a problem. So it has all of these implications throughout the business. It’s really not just marketing.
[00:13:38.360] Yeah. And it’s in fact, when you say positioning, it’s not just like we’re positioning and it is truly full market positioning.
[00:13:47.090] And it’s goes, as you said, beyond just like the the thing that does little type head on the website.
[00:13:52.610] When you go to the homepage and you see a little slider like that, that’s reflective of positioning, but that in itself is not positioning.
[00:14:02.060] Yes, that is exactly right. I also have some people that will, like, send me a website and they’re like, can you tell me if this company has great positioning? And I’m like, I don’t know. I mean, you can tell. So if yes, you can usually tell by the website if but if the website if you don’t think that there’s great positioning reflected on the website, that could be a website problem. It could be a copywriting problem.
[00:14:28.550] It’s it could be a positioning problem. But you can’t you can’t really know for sure.
[00:14:33.380] Yeah. Actually there was somebody I spoke with the other day and it was he was telling me about the story of his company. He’s a single engineer with a with a co-founder.
[00:14:42.560] And they’re they’re doing really neat stuff. And so I took a look at the website because he sends me the email address. And so we met just through a friend. I was helping him out and to help him with a technical problem. And so I talk with him.
[00:14:56.300] And I was like, oh, actually, tell me about what your what your platforms do.
[00:15:00.500] And I’m actually very interested in what the problem is you’re solving.
[00:15:04.730] And he said something for like in two minutes he gave me this incredibly profound statement of like, you know, how we have this problem that goes on, like we want to make this not suck for people. So we took on this task because we realized there’s a better way to do it.
[00:15:20.740] And he goes through this thing that was like, Allen, you just totally nailed this. I went to your website.
[00:15:29.120] No idea that this is what you do. Right. You can you need to connect those two things together, because the story you just told me is incredibly compelling. And it made me say, OK, well, how do you do that? Like, it’s it did all the right things. And it was so funny that there can be this weird like sometimes the market, the marketing of the message in the in the website, like said, can really be good.
[00:15:55.030] But, you know, what’s the churn rate, what’s the attach rate? What’s the growth rate like?
[00:16:00.100] There’s other things that you said about positioning is much more than just, oh, that’s really neat. I know what you guys do now. Well, that’s sort of the fundamental, though, about positioning is it’s about making your prospects. Oh, I’m using that word again. That’s all right.
[00:16:16.820] I know I’m going to make you overthink that every day. I know.
[00:16:24.770] So it’s about making everybody not even just prospects. So customers, your current customers, you also don’t want them to be confused. So it’s about reducing confusion. And part of the goal is you want you know, when somebody comes to your Web site, they you want them to immediately understand what problem you’re solving. And how you solve it and is is your solution right for them or not? I know you always remind people like you’re you’re not going to boil the ocean.
[00:16:56.600] You’re a startup with a million dollars or ten million dollars or whatever. You’re you’re not going to you’re not going to be Facebook tomorrow or next quarter. And, you know, you need to focus on some sort of specific market. And so having somebody come to your website and say, oh, I understand what this is and it’s not for me, that is also a good outcome, because now you have not wasted, you know, hours of your marketing and sales team’s time.
[00:17:27.960] On somebody who is never going to buy your your product, that’s so that’s something that people don’t even realize. It’s not as deep positioning.
[00:17:37.200] Your your audience is the most important one of the most important things that you can do. And I forget that sometimes, too, and like you need to immediately.
[00:17:46.080] So when someone gets there, they’re like, yeah, really cool. Not for me. You know, I’m not going to waste this person’s sales cycle time by calling them and saying, hey, I’m curious how this this may work to my use case or whatever. Tell me about the thing you do. And then you spend an hour and they go, yeah, it’s not going to be a fit.
[00:18:02.400] Yep. It’s saving everybody time, you know, it’s saving the prospect time. It’s saving your sales team time. And so that’s a good outcome. If somebody says, no, this isn’t for me, but you want that to be clear as soon as possible in the in the sales cycle or really in the marketing cycle. So it gives you the ability to to focus a lot more. But it also increases the chances that those people that are a good fit are going to understand that immediately.
[00:18:31.940] And so then that that makes them more likely to reach out and so you get this at the same time you have those that are not a good fit leaving. That’s great.
[00:18:43.940] Those that are a good fit, more likely to understand that. Now, this definitely doesn’t come from I think I’m going to be good at this like you, you’ve obviously got some some road time or some, you know, some you’ve got history that allowed you to be able to connect these things together, like there’s certain certain fundamentals of it that are actually based out of like cognitive psychology and behavioral psychology and a lot of neat stuff there.
[00:19:13.430] But you generally can’t go and read a bunch of that and then come forward and say, all right, perfect, OK, I can nail the story for you.
[00:19:20.870] So, Emily, how did you come to choose this as a as a path for your own choice?
[00:19:28.520] That’s a really good question, so I never know where to start in my story yet, but I think I’m going to start sort of way back when, which is, you know, I spent my 20s doing a bunch of random stuff and including starting two companies that never had any any revenue. Like, I think just my mom knew that they existed.
[00:19:49.310] And, um, and then I went to journalism school and then I was a tech journalist for a while. And then I moved into content marketing, and that was really sort of the catalyst for when I started to think a lot more about positioning because, oh, and I should mention that I was always self-employed, so I was always working as a consultant, freelancer. And so that’s kind of just my personality. But anyway, so you’ve always had skin in the game like you.
[00:20:24.100] You’ve you’ve always chosen that I am responsible for the the outcome here, which is it’s a brave thing to do right out of the gate.
[00:20:34.310] Well, you know, I think if somebody when I was in college, when I was like 18, had had told me that I could have a career in sales, I would have changed my life. But it didn’t really even occur to me that, like, there are people that make a living selling stuff. So I enjoy the hustle of of like meeting new clients. And you know that all of the things that are associated with with being a consultant and not having a job I enjoy.
[00:21:05.420] And including not having a boss. Yeah, I think a lot of people I’ve especially here, of course, I’m lucky enough.
[00:21:13.760] I talk to amazing folks like yourself all the time who’ve, like, walked these unique paths and on their own.
[00:21:20.330] And my favorite thing is almost all of them would describe themselves as unemployable because it’s like I am not going to they’re not going to look at the mission on the back of the wall behind the front desk and say, like, this is for me. I’m like, I’ve got my own mission. I got to complete.
[00:21:36.590] Yeah. I mean, I’m not going to say that I would never, ever take a job, but like I would say that my circumstances would have to be pretty dire in order for that to to happen.
[00:21:47.600] But I would find even even in doing so, you would become as we called I describe myself as an intrapreneur in that you create you that drive in that methodology is baked into you.
[00:22:00.350] And so even when you’re in an internal team, you will you will very much go outside the lines as a founder of a function inside a company. So there’s even if you were to go, there would probably be a temporary stint until you got back out again.
[00:22:16.250] Well, fingers crossed it doesn’t come to that. That’s even better. Even better.
[00:22:19.720] Yeah, but actually, so the fact that I was that I was working for a lot of different companies and I started to really focus on the cloud native ecosystem. And technology companies, and so the fact that I was working working as a marketing writer for these these companies is really relevant because first of all, marketing is often the first department that feels the pain of bad positioning. And second of all, when you’re outside of a company working as an external consultant, you see it really well.
[00:22:56.660] Because I think what happens is when you’re when you’re working inside of the company, you can you kind of start drinking the Kool-Aid and it’s like everything kind of makes sense to you because, you know, you’re really like you’re really immersed in everything. And but when you’re looking at it from outside.
[00:23:16.110] And you’re trying to get some direction on this piece of marketing writing, and you’re like, who are we writing this for?
[00:23:22.530] And they’re like, well, you know, our audience is sarees and platform engineers and developers and also VPs of development.
[00:23:31.440] And you’re like, whoa, those people care about very different things, like, how am I going to write this? And so it actually got pretty frustrating because this was so prevalent that people were just not really capable of giving me clear direction, which when it happened, basically meant that my project was not going to be successful and I knew that.
[00:23:57.090] So that’s when I started to think, you know, I can see that this is a problem. I tend to be actually a really big picture person. I think this is why I didn’t do such a great job when I when I was employed and in my very early 20s. I’m not super detail oriented.
[00:24:15.530] So and this is the interesting thing.
[00:24:21.060] And I actually heard a great interview the other day and it talked about the sort of the creative mind and the the process of of being a creative person. They sit.
[00:24:30.340] And when the fellow said, unfortunately, these creative people tend to make a lot of money for other people and not for themselves until it’s far too late for them to enjoy it.
[00:24:39.940] And it’s I’ve I suffered the same sort of challenge of, you know, every year it gets to my annual review and they’re like, hey, you know, be great. Like I’ve got I’m a I work in a startup and they give me a lot of autonomy and they’re fantastic team. And so when it comes to interview time, it’s not like when I worked at a big financial company, they’re like, OK, according to this year, the nine box or the seven boxes, they get all these crazy things.
[00:25:02.640] And then but it would be like every year I’d say, hey, look, it’s that time of year where we say it would be great if you were better at project management and detail oriented, long view, you know, content. I’m like, I’m never going to be that. I’m like, just going to lay that out there right now. I’m never going to be good at this stuff and I’m going to be fantastic what I do. But they’re like, we want to put you in a box.
[00:25:24.630] And like, I’m like, no, no, I don’t want to be there.
[00:25:29.580] You know, it actually, I think makes me fit really well with this industry because a lot of engineers are detailed oriented. Yeah. And so what they at the the ability to step back is really what they’re missing. And most of the founders that I work with, they’re they’re engineers and they’ve now founded a company and they’re really good at like making sure their code is not missing a punctuation mark or something like that. And, uh. I would suck at that.
[00:25:59.540] Yeah, it is a beautiful thing of the merger of those styles because you have you have a technical you understand the technical audience and sort of the buyer audience as well as the consumer audience, you know, or they as they say, you know, the users.
[00:26:15.130] Another word I often cringe that we say, but the users and the buyers.
[00:26:20.290] Yeah, but the it is a really good mix that like you want the technical founder to be a technical founder, not a big picture market maker, like you want them to be fantastic.
[00:26:34.450] What they do and you will be fantastic what you do to allow them to continue to build product and think about what’s next. Yeah, and, you know, honestly, a lot of the founders that I work with, like they they’re not just engineers. They’re very, very good engineers. And these are you know, there are people that have actually and then I’ll go into a caveat sometimes that is also the challenge is that there are very, very good engineers.
[00:27:00.640] And so and they’ve often worked at companies that are very tech forward. They’re very, very far on maturity curves. And so it can be a big challenge. In fact, I think this is a big challenge for the industry in general.
[00:27:18.190] Is it sort of connecting to the real world experience of a mediocre engineer who works at a mediocre or works in, you know, a mediocre technology organization and, you know, mediocre? We often use that word to mean, like, look terrible, but I’m more meaning and sort of an average term. Right.
[00:27:41.470] Radeon a median on a curve, not a mediocre as in they’re not really that good. Which is right. Exactly.
[00:27:48.700] I mean and the honest truth is like that’s somewhere around the medium is is that’s where most people are going to fall. That’s where most users are going to fall. It’s where most buyers are going to fall. Even if we’re like, you know, directors of development or VPs or whatever. Not every one of those VPs isn’t is an amazing VP at his or her job. And not everyone is inside an organization that’s an amazing technology organization. And that’s OK.
[00:28:18.360] I’m I don’t think there’s a problem with that. It’s just that that I think the the ecosystem and the the founders of these amazing startups need to sometimes need to do a better job at sort of stepping back and thinking, OK, where where is the market like where is the market actually at?
[00:28:37.120] Where are the the people that I can help?
[00:28:41.090] Where are they? How do I meet them, where they are and how do I use terms that are going to resonate with them, and what problems are they actually experiencing? Oh, yeah, sorry, go ahead. Oh, I was going to say and then there’s one other thing, which is like what do they actually perceive as being an alternative to my product? So that’s a big part of positioning is what are the competitive alternatives? And the common thing is you ask somebody, what are your competitors?
[00:29:12.920] And they will name another company if you actually drill into it and say, what are the competitive alternatives? The competitive alternatives are doing nothing right? So I know it hurts me to say it, because I know it’s it’s it’s an easy answer, but it is true in that, you know, our biggest competitor is status quo.
[00:29:36.800] You know, it’s so too true. You know, in so many cases, it’s it seems like a like a gimme if you say it. But like, no, it’s most people struggle from just like, hey, this is good enough.
[00:29:48.590] I mean, it’s it’s both both for business buyers, but also for consumers. I mean, I was looking at cars last month and that if you ask a car company like, what’s your competitor, they’ll talk about some other car. I didn’t buy a car. I’m not going to buy a car. And that’s what probably what like most of the people that enter their funnel, so to speak, are going to end up not buying a car. They’re going to do nothing.
[00:30:12.800] Yeah, yeah.
[00:30:14.180] That’s and when it comes to the the technical buyer and the technical economic lead buyer, you know, so like a CIO, CTO, somebody is an organization they’re uniquely challenging to market towards because they are generally, you know, technical.
[00:30:36.830] So they ask harder questions. Well, to use your car example, your more people are going to go to buy a car because they need to get somewhere and they kind of don’t care what’s inside the car. They just want it to be the right price. They’ve got a certain set of criteria.
[00:30:55.390] The ineffective alternatives are the bus not having a car.
[00:30:59.570] There’s it’s but the buyer is most often not technical. And in fact, when we get into the technical marketing piece and technical competence, you know, positioning is the worst case scenario of super technical people.
[00:31:18.880] They’re like, what does it do here?
[00:31:20.320] You know, it’s that whole thing of I don’t want to dwell on speeds and feeds, but we’re going to dwell for 45 minutes on speeds and feeds, you know, and all these little, you know, knobs and dials on on what it can do.
[00:31:32.530] Yeah. So to go back to the car example, that’s actually really good. So when you’re doing technical marketing, one of your biggest competitors is built to build it yourself DIY. So instead of buying your thing, we’re going to build a platform. And ourselves, if you’re buying a car, like quite frankly, I do not think that one of your competitors is like like I wasn’t even thinking like, oh, well, you know, I’ll just build a car myself.
[00:32:01.420] I say, and I don’t think that that’s like a real realistic competitor for most people. Yeah.
[00:32:09.430] But it is in the technical marketing that that’s a really big, major competitive alternative. Yeah.
[00:32:18.160] And we we run into that problem, too, of especially when you’ve got a really good engineering organization and we it’s the problem we call nature not invented here. Right. When you go do you pitch a product then they’re like.
[00:32:31.170] You know, they just like you can see them sort of squinting as they’re listening to your discussion and they look at the ingenuity and said. Can we do something pretty close to this ourselves, like, oh, no, like that that is a real unfortunate confidence in the ability to throw people at it. And I’m like, if you’ve not heard of the mythical man month, this is going to end poorly for you.
[00:32:54.620] Yep. And, you know, it’s that’s also the the user user buyer discussion, because sometimes this like whatever it is that you’re selling like that looks like a really interesting problem to solve. And if you’re if you’re targeting the wrong level in an organization, you you know, you’re just going to be giving them an idea and they’re going to think, gosh, I would rather spend the next six months working on replicating your product internally than doing whatever it is that I’m that I’m doing.
[00:33:30.110] That’s usually when you’re you’re marketing too low, because most likely once you’re once you’re getting to the people that have more of like a more business metrics that they care about. And they’re they’re managing people. They do not want the people on their team building that platform that is not in their best interest, but the people that the engineers themselves. Oh, yeah. That that’s a big problem. They want to spend some time building that.
[00:33:56.000] It it’s funny. You can you often find out it’s like going to family therapy when you’re in these discussions with folks. And I get I’m lucky to be very close to the customer experience all the time. And it’s like I was a user.
[00:34:08.210] I sat in the desk as a systems architect for a couple of decades, so I know the pain directly. It’s easier for me to relate it when I talk about product and outcomes and what we get.
[00:34:20.150] And it’s funny that you can get a lot of folks that are really strong technical champions and they have a genuine day to day problem that maybe their boss doesn’t know about.
[00:34:29.690] And that gets uncovered like beautifully in the right conversation because and you need that as to do proper positioning and selling and renewing, because if you only give value to the user of the consumer, the product, and they don’t see the KPIs being effective, affected at the top, then they’re like, you know, I don’t I don’t know that I’m getting value from this thing I just saw a renewal for.
[00:34:56.840] And it’s like you said, positioning isn’t just about prospects, it’s about your existing customers.
[00:35:03.350] You got to keep reminding them that you’ve got value or even adding more value and more capabilities. And how do you relate those?
[00:35:11.680] Yeah, and, you know, part of positioning it, some of the things that that we work on narrowing down is who is the right buyer? So, again, when you think of an engineering organization, it’s not like homogenous. There’s going to be the salary teams. We like to talk about breaking down silos. And in reality, there’s still silos in most places. So, you know, unless unless you’re selling to like the CTO who’s responsible for the whole thing, there’s going to be silos.
[00:35:41.200] And and most of my clients are not going quite that high level. Yeah.
[00:35:46.930] And and this is the funny part is as much as I see that silo slide on everybody’s sales deck, guilty as charged, we know the truth is that there’s just no way to really break those things down. The reason why we had to start calling it like dev spec ops, they’re like, why do you need to explicitly say second line? Because no one invited security to the party and it wasn’t pervasive to the flow of of code. And they’re like, oh, OK.
[00:36:14.320] You know, Nelson, someone described the other day, they called it biz dev sec ups. And like, we’ve officially figured it out that we forgot to include the business people in the discussion.
[00:36:25.510] I have not heard that one yet and I love it.
[00:36:28.330] So now eventually it’s going to become this like biz dev sec, you know, like there’ll be like three or six trade offs.
[00:36:38.590] But so, yeah, in practice now this is just like you talked about positioning.
[00:36:48.050] It’s important to know who not to position for into position the the the unimportant or the the the not valuable prospect.
[00:36:59.000] In your experience of doing this stuff. Most of your success in knowing what to do probably comes from seeing a lot of what not to do and and seeing metrics that showed that that was the case.
[00:37:12.940] I’m curious, Emily. When did you start to tie in? How do I measure the effectiveness of positioning and marketing and like where this comes together? Yeah, that’s that’s a really good question of how it’s measured. So the first thing. Yeah. Position is interesting to measure. So you’re not going to feel like you’re not going to improve your positioning and then tomorrow you’re going to fix these things. So often we’re talking about like a fairly fundamental shift in how the company is.
[00:37:49.280] Talking about itself and operating, so we’re not going to see, like a change tomorrow, but there are there are some things that will change immediately and then there are metrics that you should see improvement on if, in fact, your your positioning has been improved.
[00:38:08.270] So that the first result is this is a human one, is that I find founders have more confidence because often the pain point that they come to me with is that they don’t know how to talk about their their company. They don’t know how to talk about their product. And it’s frustrating. And they. And they feel like they’re their sales calls are kind of they feel like they’re not going great.
[00:38:38.750] Basically, they feel like the first 15 minutes, the prospects are confused and and it’s really frustrating. So that does change immediately is there’s there’s often a shift in sort of how the confident the founder or founders feels and sort of having a discussion or or describing. So after positioning, you should be able to describe your your product in like less than a sentence, like five words. Yeah. And so that’s the first change. And then the second thing this gets into, like, what are the signs that you’re positioning kind of sucks.
[00:39:15.170] And then then obviously if your positioning is better, it’s going to you’re going to see improvement on those metrics. So one of them is high churn at like everywhere on the funnel. And so if you have a lot of people coming to your website, but like every every part of your funnel, there’s it’s just incredibly leaky. That’s probably a positioning issue. If you have a lot of churn in your customers, that’s probably a sign that the customers maybe thought they were going to get something else.
[00:39:51.080] And then they signed up and they were like, oh, whoops, this is not actually what I was expecting. I don’t actually need it. That’s a positioning problem. Right? You want people to, like, actually get the thing that they thought they were getting. So basically, you should be improving your your conversion rates at all. All spaces on the funnel, the marketing sales funnel, you should see lower customer churn. And those are what I would say, I mean, and ultimately, right, those are going to lead to better revenue numbers, et cetera, but those those are the really bottom line positions and metrics that I would look at.
[00:40:34.520] And here we have like the sort of problem is that those are marketing metrics and that’s why people think that positioning is a marketing problem. Right. And but right. If you have a high customer churn, maybe your product sucks.
[00:40:52.450] Oh, yeah.
[00:40:53.870] It could be a problem or it sucks for the people who actually end up buying it. And so it really isn’t just marketing, it’s really high level. Another thing that I also see with the win positioning projects are really successful is that it’s easier to get. It’s the PR is easier. It’s easier to get it in the press. Because the you know, whether you’re doing PR yourself, whether you’ve hired a team, it’s it’s easier for them to communicate with other people in the industry about what you do and and that that makes it easier for them to write about in the the challenges as people, as humans, especially in technical.
[00:41:35.660] You know, we’ve got a lot of strong technical founders.
[00:41:39.590] Like you said.
[00:41:40.190] It’s it’s a tough it’s not in their brain to like they’re not built to be able to tell the story in. That’s why we always talk about jobs and Bosniac and people get really irked and angry like jobs wasn’t technical and it was just a marketing guy and like, well, it was technical. It didn’t necessarily write the code.
[00:41:59.000] But, you know, he had the ability to take the technology and relate the story and and he even attributes he says. The ability to do so wasn’t just from fantastic storytelling, which he was particularly good at, but he has this book and I actually have it on my shelf.
[00:42:16.470] I had to hunt it down around the world called the business value of computers.
[00:42:20.820] And it was effectively an accounting guide into how to actually measure the effectiveness of using computer systems in large organizations.
[00:42:29.970] This is like mainframe type of of adoption. But he said if you can’t. Show them that there’s metrics that they’re going to that are going to matter to them and then a human side to that story. Then, you know, technology is going to save you from a bad sales problem, which is which.
[00:42:47.840] And as technology founders said, so you come in there and do a lot of amazing technologies, probably wouldn’t pass a Turing test.
[00:42:55.700] There’s nothing wrong with them having an incredible amount of skill. So let’s put somebody beside them who gets why they’re doing it and what they’re doing it, and then can make that a storytelling exercise, which then ultimately becomes. Based on the foundation of positioning, like you said, it’s it has to come from there. This is the the core and then everything should always go back to like, ah, OK, here’s your value drivers or whatever you call them.
[00:43:23.090] But like, it’s it’s in the founders. There’s a great book actually called The Founders Mentality. And and it’s a it’s actually by being in company, they’re a marketing and advisory firm in in Boston.
[00:43:39.410] Not to be confused with Bain Capital, which is always funny because I my company, as well as one of one of the Bain Capital companies. But it’s very, very cool that they talk about this idea of like the founder can get frustrated because they see the selling position moving away from what the product was meant to do, and then they lose track of it and then the numbers start to go home.
[00:44:02.420] And what’s worse is that it doesn’t get felt like you said, you know, you change your positioning and you do it right today. You don’t notice it tomorrow, the metrics are going to play out over time. Yeah, and it can be pretty quick and then the other thing, so there’s there’s a couple comments here.
[00:44:24.580] It’s a first of all, it can be a pretty quick I mean, if you actually implement your positioning, you can feel it pretty quickly, but it’s not going to Beechboro. And the the other thing is that almost always the the best positioning for your product isn’t necessarily be it the positioning that you had in mind when you created it. And that that is why actually that’s part of why founders have to be involved when we do a positioning exercise, because it can involve almost like shifting, shifting the identity of the company.
[00:45:01.300] And if it’s that could mean shifting the identity of the founders. And so that’s the most challenging part actually of of positioning is is like having everybody sort of let go of what they thought they were creating and then figuring out like what is the thing that actually is here that was created and how do we highlight its strengths in a way that that that’s that’s going to get customers really excited about it.
[00:45:33.350] And positioning it can change over time, it’s not something you want to change like every month, but you should sort of check in to check in with it like once a year, once every six months to see if it’s still working. And, you know, one of the the other thing is like if there’s a big market shift. So, for example, covid-19, there was and everyone’s working from home that can present certain challenges to to organizations. And maybe, you know, maybe you want to reposition your thing some maybe the competitive alternative to your product is walking over to your colleagues office.
[00:46:15.260] Well, that’s not an option anymore. And so you need to be able to to sort of capture that.
[00:46:21.690] Oh, there’s a last thing I wanted to say, which is that actually Apple is a really good example of good positioning and there’s a lot I can think of a lot of ways. First of all, when in the early days of Apple computers, it was not a general purpose, personal computer. It was for creatives. Right. And this and that ultimately is how Apple computers became like the cool version. Right. Like, if you were an accountant, you got a you didn’t get an apple.
[00:46:54.240] If you were like a graphic designer, you definitely got an Apple computer. And that had ramifications, obviously, not just for their marketing, but but it was their product was also different. And it had to focus on different types of functionality. And then when the iPhone launched. So think about the name of iPhone. An iPhone is actually not really a phone like it does have phone functionality, but that’s like a tiny little bit of of its functionality.
[00:47:25.260] But at the time that it launched that like that was what the company and Steve Jobs decided to accentuate, because that was something that that people associated with, like putting in their pocket and taking places.
[00:47:40.770] Imagine if they had called it like the eye pocket computer or something crappy. Yeah.
[00:47:48.510] And and in fact, actually, if you watch the iPhone launch video, like. Tobes, does all this like talking about voicemail and like call for, like all this stuff that’s phone functionality that like nobody uses now and probably nobody even used then, but it reinforced this position of this is a phone. And so it makes sense. It makes sense as a product to to me. Yeah.
[00:48:14.010] It becomes the what’s the what’s the comparative that will make sense to people then they can they can map it over.
[00:48:21.150] And this I’d love to hear your thoughts on this one. The words and in that we use are interesting. And I get lessons in this all the time.
[00:48:32.910] So, you know, the founder of my organization, he used to like super technical.
[00:48:39.810] He’s like really, really able to do incredible things but knows the business, you know, third time founder, like, really, really got a good sense of how things go and people kind of forget how strong is the business side of it.
[00:48:54.090] And so you get people know, like he’s like this is what we do. And this is, you know, you go through the whole thing.
[00:48:59.520] But in the end, we as humans try and find differentiating words to make it easier to explain or sell.
[00:49:07.020] And so people always say, like, we solved this problem in a unique way. And he he stops. He goes and he asks his name was my favorite thing to hear. He goes, Can I ask you? Where did you have a lot of friends when you were a kid and so like, yeah, yeah, I was I was fairly fairly popular, whatever, like, OK, and so high school, you know, throughout changes in your life.
[00:49:30.380] OK, what were you unique? And you’re like, what do you mean? He goes, exactly? You were not popular because you were unique, you were not smarter because you were unique, unique isn’t a word that you want to use to describe your problem is a differentiating feature is like it may be unique in the way that it solves the problem, but the product is not unique.
[00:49:55.390] Like don’t use words like that because they’re going to pull you down a trap and they’ll say everybody says the unique. Everyone says they’re the first to market. Everyone says they’re industry leading. It’s like these are these are not important words when it comes to what we’re actually doing.
[00:50:12.060] So. Why do we get caught up in those lovely words, Emily, because they sound fine, like it’s easy to go to. Yeah, I think that you’re right, you know, it’s part of it is that we we want to be unique and I think people like to think of their product as being totally unique. And it is it’s usually there’s there’s not something that is exactly like that thing anywhere. Of course, nobody cares if you solve their problem in a unique way.
[00:50:42.070] They just want it solved. They don’t care how you do it. That’s right.
[00:50:44.830] And if you solve it in a way that’s totally non-unique, it’s still solved. And the other thing I was going to say, actually, is that this is relevant to the discussion of developer marketing because developers, engineers, they tend to have a lower bullshit tolerance than a lot of other markets. And so I think you’re probably more likely to get that pushback when you’re like we have a you know, we have a unique way of solving this problem. I think there that’s going to sound like bullshit.
[00:51:18.540] That’s going to pop out as bullshit for I can already hear the person they were going like, you know, like make like shirts, unique, whatever.
[00:51:27.480] I mean, then they’re going to they’re going to look through the like eight million open source projects on GitHub. And they’re going to say like, no, no, I found this other this project that has like two contributors and it’s actually exactly the same as yours.
[00:51:40.350] So even patented is a tough one because like, well, it is a very different thing, a very specific thing about the way and you solve the problem, like just saying patented.
[00:51:50.670] I’ve even found that in competitive.
[00:51:52.200] It’s like use this like we have 17 patents in as a competitive alternative. Like, you know, the company you’re competing with has 2000 patents. They were like, that is not a that’s not a business differentiator. You know, it shows your longevity. It shows your uniqueness in a way. But like IBM has more patents. And what’s the old joke? Right. Like how many the most patents in the world are for the most trappe go to the hardware store.
[00:52:17.340] Yeah, most trap’s a piece of wood with a spring on it.
[00:52:20.670] I don’t care how many patents there are, I just need to catch a bloody mouse, you know?
[00:52:26.550] And sometimes, like, you know, I think it’s important to keep in mind that you are ultimately selling an outcome. You’re you’re solving the problem. And, you know, if you if you get a taxi and you want to go to your house from you know, your work sets a route that you go all the time, you get a taxi and the taxi driver says, hey, look, I’m going to take you a totally unique way to get to your house.
[00:52:51.780] You’re going to be like, whoa, that does not sound good.
[00:52:54.240] Has actually. Now, the other thing that’s important. In what you’ve described in like positioning, and it ultimately is a question for you, you know, it’s choosing your market, attacking a niche that, you know, you can be effective in and you know how to market towards you as well as, you know, really lived strongly in initiative of companies in this cloud native marketplace, which is going to become huge.
[00:53:24.030] You know, I mean, already is huge. But what drew you to. How that is an effective place for you to be able to market towards and position towards, yeah, this is a great question also because I wanted to talk a little bit about how it’s not just products that are positioned and it’s not even just consultants who are positioned. It’s even if you have a job, you it’s it’s still a good idea to be known for something and to be a specialist in something.
[00:53:53.370] And even if you are a developer. Right, maybe you’re a specialist in a particular language, maybe you’re a specialist in a particular type of business. So I think that it’s really important for for everybody to to try to specialize to a certain extent. And when I think about what what a consultant or even somebody who’s going to be an employee should or should think should think about as they’re positioning themselves is where the overlap is between things that they are good at, things that they enjoy and things that people are willing to pay money for.
[00:54:37.620] And the same goes with industry. Right. You could apply that to what you do or you could apply it to the industry that you’re going to work in. And for me, obviously, like I have tons of interests. And either that being a positioning consultant is not the only thing that I think I’m pretty good at.
[00:54:58.920] But and but there’s this this sort of overlap here where working in this industry and it helps that I started obviously I started as a marketing writer in this industry, there’s sort of an overlap of people that actually need this and are willing to pay money for it and that I’m that I’m good at it in terms of why I think I’ll go back to the discussion of not being very detail oriented. So I was actually interested in like Web development, and I played around with Drupal for a while in my in my 20s.
[00:55:34.740] I don’t know if you know Drupal, but it’s like we’re spending a little time in that.
[00:55:38.290] It was it was the the it was the Beda to WordPress VHS. It was technically better, but unfortunately not marketed well enough to to make a big landing. I actually don’t think that’s true, I think one of the most successful open source projects out there in Aquia that was Akwe is that was founded by the open source maintainer. It was sold, I don’t know to who, but for like two billion dollars, like a totally insane amount of money.
[00:56:08.350] So actually, Drew is an open space, open source success story and a lot of ways because all sides huge community.
[00:56:14.920] Anyway, my point being, it’s not like an entry level web development platform. It’s quite complicated. It’s very it’s very powerful. But it’s a you really need to be like getting your hands in the code in order to be successful with it. So I like, you know, I taught my self how to do some stuff, but I ultimately like I I’d miss a period somewhere and it wouldn’t work. And I just get really frustrated and yeah. That it just wasn’t for me I couldn’t deal with, like, I, you know, I missed a piece of punctuation and my work is a total failure.
[00:56:50.020] And I think but I sort of remained interested in this, this sort of the technology field in general and what we can do with with software.
[00:56:59.290] And and then I think there’s like there’s a little bit of a cultural fit. Even if I’m not I’m not the detail oriented engineer. I think there’s a there’s a cultural fit between the, um, sort of like it’s really hard for me to put my finger on what the cultural fit is.
[00:57:17.920] Um, let me think about this for a minute.
[00:57:21.490] I think I just I feel like it’s really easy for me to empathize with the sort of developer problem or the developer personality of, like, liking to work alone consultant, freelancer, being, you know, really interested in like finishing projects, being a little bit type A. And so I think that there was that as well, sort of being interested in the technology and then just feeling like like it’s a cultural fit. Yeah, like when I went to Cube Khan there was Cube Khan and then there was like an accounting conference that was in the same location.
[00:57:55.990] And I just like you looked at all the accountants and I was like, whoa, those are not my people. I do not know there.
[00:58:03.220] It’s so funny that I’ve I’ve always enjoyed when you go to especially a conference center and there’s like multiple things and, you know, like, you know, we’re sitting here and we’re making nerd jokes about technology, then, you know, in the room next door, they’re like, so this idiot filled out a ten, twenty nine instead of a four to twenty eight, like, holy moly, where did this guy from Mars, like in totally meaningful, hilarious anecdotal humor over there.
[00:58:28.930] But it’s like every, every industry, every thing has a community and has its own nuances and isms about it.
[00:58:37.510] But what actually I want to pull on the string that, you know, you hit something really neat. So my perception in general awareness is that WordPress has been, I’ll say, most known to be successful relative to Drupal.
[00:58:56.860] And it comes from two factors. One, I didn’t track the growth or ultimately the the the trajectory of Drupal. I knew about it.
[00:59:05.470] But because I go everywhere and I see WordPress, I have a perceived understanding that it is more successful, even though it may not be in this. I bump into in Carbonetti folks all the time. They’re like, this is incredible. It’s like winning the container war. So that’s well, how big is that war? Right.
[00:59:22.210] You know, relative to virtualization and cloud and everything else. So. How? How do you deal with that situation when someone says like, no, like this is the the metric that matters to me or this is my opinion of a metric and you’re like. Well, we actually have to look at the real metric that matters. I mean, ultimately, like you do get to decide if so if you’re the CEO of a company and you decide that X metrics matters to you.
[00:59:51.390] I mean, maybe that’s the most important metric, I mean, maybe I don’t agree with it, maybe your investors don’t agree with it, but that that is one of one of the advantages of being CEO, is you get to focus on the metrics that you think matter to you and does it. But, you know, some some companies might get really hung up on like we have the biggest number of users and GitHub stars, are we?
[01:00:20.820] We have to get them stars and like those GitHub stars, they’re free. So, you know, what do I think that a company should probably have like some hard dollars as a as a metric? Yeah, definitely. But, um, if if you think, you know, if you are the CEO and you’re getting really hung up on some other metric, like, that’s OK. You know, I think the thing that that people should take out of this this discussion about WordPress and Drupal is.
[01:00:52.790] That just because you are not necessarily a household name or you’re not like, you know, a household name for four, Technologist’s doesn’t mean that you don’t have a successful company, that you can have a very successful company.
[01:01:09.230] You can you could go public. You could, you know, have a giant exit or you could just run your very successful company.
[01:01:20.420] You can make tons of money and people could think, oh, Drupal is just, you know, it’s a a failed competitor to WordPress and ultimately, like, it doesn’t it doesn’t really matter.
[01:01:33.260] Like, maybe you were never in a position where a Drupal word Drupal made sense. And so you might think that this is why I started using Drupal, because I erroneously thought it would be a good idea for for just a random person setting up a website. It’s not WordPress is the best option for that. If you have a really complicated Web site, that’s where Drupal is appropriate.
[01:01:56.720] And so that’s why you see like like university Web sites are like big organizations like the U.S. government, Web sites, places like that. Those are the ones that use Drupal. And so and, you know, they have like all this super complex functionality. But that means ultimately that they don’t become a household name because they are only they have a relatively they have a niche, but it’s huge, right?
[01:02:23.700] It can still let them be acquired for two billion dollars. I think it was two billion dollars. That might be wrong about that. It was huge.
[01:02:30.120] Yeah, but it’s and it’s interesting, too. Yeah.
[01:02:32.400] Like you, we I see this positioning in marketing as well as like the careful thing of, you know, what is it if you say it’s for creating websites like you’re going to have a real tough road. You know, if you say it’s it’s an enterprise grade CMW based on the most widely adopted and broad open source ecosystem, we’re like, oh, OK, cool.
[01:02:58.470] So a legitimate CM’s now I know it’s a different use case and they start to then map the use cases in their mind of like oh versus yeah I want to go set up so I don’t want to go to Wick’s and set up my website, you know, let WordPress looks like it may work for me.
[01:03:13.380] OK, yeah. Drupal is not the thing that you just like set up on Blue Host and start your personal blog on the thing. But yeah, for the the more complex setups that it is. And so in the startups that I often work out there, they also get really hung up on this. And then you ask like, so how many, how many customers do you want to sign this quarter?
[01:03:34.680] And they’re like five. And you’re like so far, like, that’s not very many. I mean, you don’t have to go after a huge market in order to to sign five.
[01:03:47.670] Yeah, this is not time to be buying mailing lists. You’ve you’ve got a fairly niche area. What’s the with the flow is going to be much different.
[01:03:55.860] Right. And you’ll end up being much more likely to hit that five if you’re going after a market that only has five hundred people in it because you can speak directly to them and they’re going to listen. Whereas if you know you’re going after like a five million people, I mean, how do you even like.
[01:04:15.730] No, you don’t. You’re not people are going to ignore you.
[01:04:18.960] That’s that’s when they think that you’re a spammer. But if you speak directly to their their needs and, you know, like.
[01:04:28.580] Salaries and financial services institutions like you. Oh, OK, yeah, that’s me.
[01:04:35.750] Now this will be interesting, too, because you’ve got a good background in you. You you came from tech journalism and you’ve you’ve obviously got some really good strength and you’re fantastic writer. By the way, I read a disturbing amount of your content in preparation for our discussion and listening to a lot of your podcasts.
[01:04:53.690] So I had the easiest job of coming into this hour. I was like, Emily is going to be able to run on anything. This is fantastic.
[01:05:01.790] But I’m curious on your thought on what the role is of journalism, you know, literally today relative to when you were in it versus like it was very different in like PR went to certain, you know, key journals.
[01:05:17.900] And then you got I think now it’s I just find so different. I’m curious, as somebody who lived in the inside, what’s your sense of the place of tech journalism today? Right, oh, I was about journalism in general, I was going to say I’m super cynical, as most journalists probably are.
[01:05:37.460] Yeah, but I’m actually less cynical about tech journalism. So I actually have two degrees in journalism from Columbia, another one from a university in France and a journalist I approached very differently in Europe because I’m talking about sort of general interest journalism, because in general, in the US journalism journalists are encouraged to like claim to be totally neutral on everything, which I happen to think is bogus because we’re all human beings and we all have opinions. Yeah, in Europe, that is not how journalists operate.
[01:06:18.740] It’s not how news organizations operate. So you would have like a newspaper and this is the newspaper of the left or this is the newspaper of the Catholic Church. And they they don’t pretend that they’re totally neutral.
[01:06:34.190] So this relates to tech journalism, because I think my my less cynical ness about tech journalism is that in general, I think tech journalists are more like that.
[01:06:47.240] So they’re more they’re a little bit more open about, you know, where we take money from these companies, for example, these are advertisers.
[01:06:58.310] It’s it’s very it’s very clear. And I think what I do want to say about about tech journalism in general, and I’m not actually totally out of tech journalism, so I write for the new stack and I do so in a in a journalist capacity.
[01:07:14.390] And one of the reasons that I do is because it I learn so much.
[01:07:19.910] And I think the biggest misunderstanding among founders about tech journalism is that that the journalists who cover technology and who who cover particularly like opensource cloud, native stuff like that, they are really knowledgeable and they understand the ecosystem. Honestly, I think that they understand it better than anybody else because this is their their job is to talk to people from everywhere, to talk to end users, to talk to all the different vendors, to talk to the super big guys, to talk to the super little guys, to talk to investors.
[01:07:59.470] So they are they are really knowledgeable and yeah, speaking of like the no bullshit theme, journalists also tend to be like pretty no bullshit. But definitely when you talk to a tech journalist, like they they’re able to spot the bullshit like really easily. And the not just they might not spot like if you if there’s, like, something in your technology that doesn’t work, like they’re not generally engineers themselves, they won’t get that. But if there’s something about your business or your messaging that doesn’t make sense, they will definitely pick up on that.
[01:08:36.520] I as somebody who’s had to do the dance of, you know, going into PR and like going out and doing launches and interviews, it’s so funny because I’ve and one fellow I always enjoyed chatting with and it was painful every time Simon Sharwood, he worked for the register or he wrote for the rest of these independents as well.
[01:08:58.120] And yeah, I remember going to one time and we changed the version number of the product and it was like this.
[01:09:04.240] It’s like a fairly small thing, but it went from like five nine to six zero.
[01:09:10.690] And, you know, he says, so why is the six to eight zero? And I didn’t really know the right way to tell them because five, we ran out of numbers and like, this must be what I’m like.
[01:09:23.530] I knew the implication of a major no change. I was like, oh, Sirene, you’re going to make me say this stuff that it just happened, that we ran out, that we couldn’t be five. But and my engineering team were like, we’ll make it five, ten. And like, you know, that’s five one five one zero five times, not five, ten.
[01:09:41.650] There’s no five. Ten.
[01:09:44.470] But that was that, you know, Simon just said it’s he’s like, I’m I want to get right to this. What matters? Why is this a zero? And I was like, oh, cool. You know, so he picked up that as a customer. They’re going to see like, oh, this is a major release. This is going to be a significant change. Tell me why. And it was neat. And Alex and the team from the new stack up and a huge fan of that of the whole organization from the start.
[01:10:09.580] So it was like a glory day when I went to I presented on Carbonetti at the Open Stack conference in Boston. And and there was a fellow just like chuckling away in the front during my presentation, I was like, all right, I feel like I’m doing good. Like I’m engaging the audience. And then I saw the ad, the article the next day in the new stack and I was in there.
[01:10:30.130] I’m like, yeah, I feel like I hear that I made the news.
[01:10:33.780] But Alex has done a fantastic job of going from purely independent writers, talking about technology in an ecosystem that he and his team cared about to be able to cross the chasm to being commercially viable, but maintaining journalistic, you know, integrity. So it’s very clear this is a sponsored post, but maintains that very good content in a sponsored post. He doesn’t let it become a commercial. And I think that’s where, like you said, there’s a no B.S. factor of like I’m not just going to let you come in and say, you know, what would make this drink better if it was built by this company, you know, on this technology, like, there’s no room for that.
[01:11:18.040] And Alex and his and the new stack are a great example of folks that. Make sure they keep that nice hard line. Yeah, definitely, and you’re right on, I think, you know, tech journalists, they and this is where positioning comes in. I mean, that you really want to, like, tell them what the value is like. Why does this matter? And it’s you know, unfortunately, it’s a thing that I think a lot of companies get wrong because they they’ll send an email.
[01:11:46.200] We’re releasing a new version and its version, you know, six point one point three point five. And it’s I’m like, I don’t care why I should care.
[01:11:58.540] And the fun part is, of course, because you have to pass out an hour conversation or a 20 minute conversation and then get it to a few meaningful bytes that matter.
[01:12:06.670] And I remember it also. It’s fun. Beth Parisotto, she’s also a great writer. And and I talked with her for like an hour on Carbonetti stuff. And we go through this whole thing into the end.
[01:12:16.600] The quote that comes in the article was like, Carbonetti is on virtual machines is like a gateway drug to Cubanos on bare metal.
[01:12:22.800] I like you say it almost as a throwaway, but you’ve got to remember when microphones are on, everything’s live and everything’s on the record. And it was it was fine. Like I said it for a reason. It was it wasn’t meant to be like, I hope she doesn’t write this, but every once in a while I’ll say something.
[01:12:38.380] And then my my PR team, you see their eyes go their eyes wide, not be like, oh, did I just say something that like hopefully they don’t catch that quote in there.
[01:12:49.980] But in journalism school, when I took classes in radio, they would say, like, you never turn off your mic. You would say, like, OK, we’re done.
[01:12:58.780] You’d like take off your headphones, but you would keep your mike because people would always say, like the the interesting or sometimes incriminating thing when they erroneously assume that your mic was your recorder was not running.
[01:13:15.850] Yeah, I tell you, that’s and I’ve always got an incredible respect for the true art of journalism, you know, and in that thing of like, yo, are we off the record?
[01:13:25.720] And it’s the whole like when I read more and like like delved into how that works and the idea of deep background and how it’s like there’s so much to real journalism that unfortunately is is just shaded by what we call media and that it’s really been broken.
[01:13:48.190] But the real true journalists, you know, the journalists out there and the principles and practice of it are are fantastic and so necessary.
[01:13:58.450] But, you know, the world has kind of shifted in a weird way of, you know, it becomes, you know, see the twenty three things that his gym trainer would doesn’t want you to hear about AB exercises or whatever.
[01:14:08.800] Like it becomes this weird Outbrain articles that are on mainstream media sites and it gets really lost in the power and importance of that journalism.
[01:14:18.520] And I think possibly another reason why I’m so interested in positioning, actually, is that journalists specialize. And this to an extent that, for example, developers generally don’t like developer developers, I think often make the mistake of thinking I’m a developer and I write software and I could work at any company and it doesn’t matter what industry and whatever.
[01:14:42.790] So journalists almost always specialize in something. And you want this because their job is to explain, to know what’s important and what isn’t and to really understand, you know, a particular subject. So, yeah. So I have always thought that it’s really important to to really be a specialist and in something and and that applies to products too.
[01:15:07.000] Yeah. It’s and it’s funny if you look at it, I mean it’s positioning, it’s positioning in every way. Right.
[01:15:15.010] Are you going to write for illusional or lemonde like which is the one you very distinct audiences, very specific demographics if you’re not aware and then same as developer like sure, you can be a you know, a journey person developer who can do write fantastic code and do all that stuff.
[01:15:32.530] But if you’re if you want to be specialized, if you want to really succeed, it’s about knowing how to map it to business requirements, how to relate it.
[01:15:41.560] How do you engage with customers as you’re building features and exploring stuff and user experience?
[01:15:47.650] There is much more that requires that knowing your customer and you know, it’s effectively positioning of everything.
[01:15:55.390] Yep, exactly.
[01:15:57.280] Oh, this is I could talk to you all day and this has been fantastic. And I want to thank you very much.
[01:16:03.430] And for folks that do want to connect with you through various means, of course, I’ll all have the link to your website. You can go to Emily Omeir dot com and what’s the best way if they want to do engage with you on on social media and also plus, go check out Emily’s podcast and and your blog said.
[01:16:21.560] Great writer, if you just if you search for Emily Omeir, there’s a wealth of content that comes up on Google because you’re a very prolific creator and it shows in in how well you approach this. You’re everything you do.
[01:16:35.280] Yeah. So let’s see. So my podcast is called The Business of Collaborative. And the goal is to sort of interrogate why companies use cloud native technology, what end users say, what people in the ecosystem say, etc. And you can go to the business of cloud native dotcom and actually redirect you to my website. But it’s if you have trouble spelling my last name and also my blog positioning open source, you can go to positioning open source dotcom that will send you in the right direction.
[01:17:10.230] I am pretty active on LinkedIn and unless you send me like a spammy connection request, I will probably accept it. And so, yeah, feel free to connect with me on LinkedIn. One of my goals for this year is to set up and be active on Twitter. I think I have an account, but I am not sure.
[01:17:32.560] So yeah, but my, my LinkedIn, I always, I always enjoy when somebody because I have an open policy I set up on LinkedIn because I also I use it as a broadcast channel. So a lot of stuff goes out in there. So I’m like, you feel bad. I’m like, hey by the way, I’m accepting your connection, but you just became my audience and but you know somebody you’ll get that inbound.
[01:17:55.200] And I just look at the like the title or, you know, what the company is. I’m like, guys, I know what’s coming. You hit accept. And then like nine minutes later, you know, hey, thanks for connecting.
[01:18:07.200] You know, one of the challenges that people face is being able to write good whiteboard videos on their product and we solve that problem.
[01:18:14.280] And I’m like, OK, I’m going to make a whiteboard video to reply to these people on how to do better prospecting.
[01:18:21.760] Yeah, a lot of people make the a lot of the spammy types. I think they make the assumption that I, like, work inside a company. And so they’ll talk to me about, like managing my team or something that I might do. This is this is not this is actually not a problem that I have as an expert operating cloud native environments.
[01:18:43.710] You clearly know. Exactly. Exactly.
[01:18:47.820] And I know you probably get this thing if you’ve ever seen the movie Boiler Room, it’s it’s one of the scenes this fellows like this crazy, you know, aggressive sales person, he learns these techniques and someone calls from The New York Times like, how can I would you like a subscription to The New York Times?
[01:19:05.550] And he’s like, No, thanks, I’m good.
[01:19:07.350] I get the post, whatever. And they’re like, OK, thank you for your day.
[01:19:10.650] And he goes, well, that’s it. And and he then goes for like twenty minutes, like schooling them. Like you got to go for the clothes, like ask for their business, you got to do this like entice them. What do they really want. Do you want the post. You want this. Do you, what do you want to light up your days like. And the guy gets all fired up. He goes excellent. He goes so it’s like a script, you know.
[01:19:29.220] But when someone pitches you, you almost want to reply like, OK, do I need to coach you how to do this?
[01:19:36.030] Like we can. You can do better. I’m disappointed. Yeah.
[01:19:40.770] So to go on a personal tangent, I’m getting certified to be a foster parent and the as like a marketer or I guess I’m not really a marketer anymore. But anyway, there’s this like it’s a bazillion step process, but I’m always like, oh, you guys need to work on your funnel and no wonder you have no foster parents like, oh my God, it is it’s really wild.
[01:20:07.050] And and thank you for doing that. That’s a really noble thing.
[01:20:11.220] You know, it’s something that we it’s a it’s not often understood the impact it can have and and how difficult it is to start the process.
[01:20:21.480] You know, people just think like, oh, you just, you know, go sign a form and do it like, no, this is not an easy thing. There’s no license to have kids. Fact. It’s it it happens far more accidentally than it does on purpose. And then when you want to go out and specifically, you know, bring a bring a child into a family, you know, it’s it’s not an easy process for many good reasons, of course.
[01:20:43.470] But it’s at the same time you’re you’re like, what?
[01:20:46.710] Can I not shorten the cycle on this here? I’m a I’m a good I’m a qualified lead. Right.
[01:20:52.290] Exactly. Exactly. I do it. That’s exactly what I want to say. Like, hey, I’m a qualified lead. Like, let’s let’s let’s move move through this process a little bit. No, in all seriousness, it is it is quite a process. So they’re coming to my house next week. Well, well, good luck.
[01:21:07.980] And on that. And I hope it goes as smoothly as it can go. I’ve got a few friends that also foster and it’s yeah. Not not a simple process which shows the intent and how strong it is that. You do have to go out of your way to make this happen, so it’ll, you know, the results will show and what it is. But yeah, here here you go. Was like, okay, look, I’m a qualified lead.
[01:21:30.360] You’ve got access to the EB. I’m your technical champion.
[01:21:33.240] I got everything. You know, I am the decision maker.
[01:21:37.860] We know the required capabilities. We know the ineffective alternatives. We’ve got it all right here.
[01:21:44.550] But making for Fosters, it’s is something we need. But I hope that people really do learn that there’s so much that’s important in what you do and what we all can do to just understand why this stuff works.
[01:21:57.870] And it happens at many layers in life and business.
[01:22:01.890] Absolutely. Well, thank you so much for having me on the podcast. This is a great discussion.
[01:22:06.000] Yeah, thanks very much. And shout out again to Chris over at mist.io for putting us together. Big shadow to Alex in the new stack and all the folks over there who I’m a longtime fan of their content. And yeah, like I said, people can go to do a quick search for Emily Omeir. You’ll see the new stack pop up and do check it out as well as your blog. Thank you.