← Mondays with Matt
Mondays with Matt
#5: Is My Idea a Passion or Potential Business?
00:54:21
Not everyone is cut out to be an entrepreneur, but you might be. If you're a great technician and want to start a business, you will have to become a good manager and owner to run a successful business.
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- [00:02]
A
You're listening to the build you'd business podcast, powered by Turnkey Coach, where we help business owners find freedom over fear. I'm Matt Reynolds, and I'm his brother, Chris Reynolds.
- [00:12]
B
Join us as we help build your business and move from fear to freedom together. You're listening to the build your business podcast. I'm your host, Matt Reynolds. I'm here with my brother, Reynolds, co host. Welcome to the show, sir.
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A
What's up?
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B
Just flew in from North Carolina.
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A
Yep. This morning.
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B
Back to Boston. Literally, just now.
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A
Literally.
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B
And so did you have a good Thanksgiving? Everything go well?
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A
Oh, it was great, man. I smoked a turkey again this year, and that's just pretty much what I'm going to do from now on. It's just so good. I love it.
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B
Did you spatchcock it or no?
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A
No, what I do, I found, like, this great recipe on YouTube and I just, like, follow this recipe. So it's a little bit hotter. It's 300 rather than like a long smoke, but it. It comes out perfect. I mean, two years in a row, I've just. It's been amazing.
- [01:08]
B
I did two spatchcock turkeys on the same smoker for Rachel's family, and then we did a rib roast. Literally just spent like 2,500 bucks on an entire cow. I bought a whole. Not a side of beef, but two sides of beef.
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A
That's a good way to do it.
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B
And then I. And then. But I didn't have rib roast because it's all cut up into steaks. So then I went to the local butcher and I spent a whole bunch more money on certainly not that much, but enough on a rib roast and did that with our family, with mom and grandpa and everybody. Because I don't want to eat turkey two days in a row.
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A
No, I don't either. I think it is. After the initial day of turkey, I'm pretty much done.
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B
I can eat a turkey sandwich or two. Or a turkey pot pie. We'll probably do this week with the leftovers. Just pretty good. Pretty good way to do it.
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A
Turkey tetrazzini, mom's recipe style. And it was delicious.
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B
Yeah. Yeah, that's. That's a good way to do. Because really, the thing is, turkey is not a very good meat.
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A
No.
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B
Right. As is. My original podcast host, Scott Hambrick, says that pumpkin pie is also the worst of all pies. And I would say that's probably true. I like pumpkin pie, but there are nine other pies I would choose over it.
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A
I rate it very low on the pie Scale. I agree.
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B
The pecan pie might be number one.
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A
It's a killer. It's the best.
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B
And so I don't know why. How pumpkin pie became the thing. So we're gonna dive in today in the build you'd business podcast again. Chris and I have almost 40 years of business experience between us. And one of the ideas we hear all the time is, you know, I'm passionate about this thing or I have this idea, should I turn this idea or my passion into a potential business? And in my fitness world, this is often like somebody is, you know, an engineer or an accountant or a banker or a nor, just like whatever. Often a white collar person and sometimes blue collar. And they're like, they fall in love with fitness and they get fit and they get healthy and they go get some certifications and they're like, I should open a gym. Should I open a gym? And so we want to answer that. I'm sure you see similar sort of things. I mean, this is a big question. A lot of people have. I have a great idea and there are lots of million or even billion dollar ideas out there that never turn into million or billion dollar businesses out there.
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A
That's totally true. That's absolutely right.
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B
That's the key.
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A
Yeah.
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B
And so one of the things that we talked about, we actually mentioned it last week and one of our favorite things, one of the most influential books I've ever read, especially early on in my career, was the E. Myth Revisited, which if you again, not sponsored. I don't know if Gerber, if he's still alive, we should try to get him on the podcast. That'd be a great conversation.
- [03:42]
A
Yeah, Love to, love to talk to him.
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B
To have Michael Gerber on the podcast. So bestselling book on Amazon, one of the best selling business books of all time came out years ago. Then the E. Myth Revisited, I think is kind of the second edition of that second printing or second edition, I guess, of that. And I'll give a quick prelude to it and then I'll let you run with this. So one of the things I remember about that book is that it's sort of set up around a fictional baker. You have this lady who's this incredible baker. She's. I mean, she's actually really, really incredible. She makes the best pies and cakes and cupcakes and all the things. Right. And all our friends and, you know, she, she brings like, you know, baked goods to birthdays and to church potlucks and to Christmas and all their friends and family say, like, You've gotta open a bakery because you're the best baker we've ever like. This is unbelievable. How good the food is, how good your baked goods are. She fights it and she fights it and she eventually she's like, man, I've had so many people tell me I should open a bakery, I'll open a bakery. So she opens a bakery, she makes the best tasting pies, cakes, baked goods in the world and the business fails miserably.
- [04:51]
A
Yep.
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B
Cause she doesn't know how to run a business, which is not the same thing as being the technician and the baker. And so how do you, when someone comes to you with these sort of ideas, how do you take that kind of concept and say, look, you've got to understand how to own or manage a business, not just be the technician in the business.
- [05:11]
A
I think the hardest part for people to get clear in their minds is this idea that there is, first of all, there's just a separation between your skill as a, in some capacity, whatever that thing is, and the ability to turn that into a profit generating business, which is a, literally a different practice, different skill set, different, you know, it's just different. They're not the same things. And that is not clear to most people by default. I think most people think if I'm really great at something or if people tell me I'm just really good at this thing, right. And I enjoy it, it's a thing I really like to do, that I can turn that into a successful business merely on my ability to do the.
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B
Thing that is not the technical work alone.
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A
The technical work alone.
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B
And it's interesting because I would like to come at this from kind of both ends of the spectrum. The technical work alone will never build a successful business. You have to understand how to own a business and manage a business. And when you become an owner, I think I can say this in a non arrogant way. I think I'm a great strength coach and I think you are a great coder, developer, but that alone doesn't build business. The day that I decided to open a business in the fitness industry, I was primarily focused, first and foremost, a business owner. Second, a manager and a technician a distant third. In the early days, you are all three. But one of the things we'll get into with the E myth is understanding how to write systems and standard operating procedures and hire people and have a repeatable sort of piece. I think that's important. So looking at it from the top down, I think is really important. But also without the technical expertise, the Business also fails.
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A
That's right. Yeah. I feel like that's, that's the hard part for people to get is that it's actually a combination of those two things.
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B
That's right.
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A
If you are a killer business person, you understand how to get customers, you know how to advertise, you know how to do the marketing piece, get dollars in the door, balance the budget, make sure that you're pulling in, you know, cash profits on a regular basis, but you have nothing, no high level skill thing to sell. You will still fail. So it requires both of these things simultaneously. And I think that's one of the reasons that it's so hard to find really, really good early stage entrepreneurs to do this thing. Because they need to have a killer skill set and they also need to be very interested in and enjoy the idea of growing and building a business.
- [07:43]
B
That's right. There's often, I think the most common lifespan of a successful business is actually that the business owner is the expert technician first. It doesn't always have to be that way. But most of the time if I'm going to build an expert coaching business in the fitness industry, I have to be an expert coach. And if you're going to build a extremely successful expert developer coding engineering company, you better be good at that. That's how you cut your chops. Yeah.
- [08:16]
A
So the question is why? And I think that leads to some really interesting conversation, not just around how to do this as a founder and how to build a company in this way, but also just for anybody who's a manager at all. The primary question is how do you effectively hire greatness into your organization if you don't know what greatness looks like? That's right, you can't. And how can you manage it? How do you figure out what the gap in the skill set looks like between where they are today and where they need to be in the future. If you don't know where they need to be in the future, you cannot. And this is the reason in general you, you'll see this. It's actually a recent thing that I've heard about in Twitter is this discussion about, you know, we talked about the book the founders, where the PayPal mafia was. You know, the story of the PayPal mafia and their growth and all that. One of the things that they, they said was they never put professional managers in place over the top of these technicians. What they did was they took the technicians that were the absolute best, best, the masters of the craft. And those masters of the craft manage people who Are not yet masters of the craft. And that has to be in a company to be effective.
- [09:35]
B
I've heard Steve Jobs quote this literally in the last two weeks. Obviously not live, but old quote from him said the same thing. As soon as we started bringing in MBAs and people who understood how to do macroeconomics and what the financing, our business tanked.
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A
The excel guys.
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B
Yeah, yeah. And he's like, instead we just hired A players and took the best A players and we elevated them and taught them how to train new A players. That was the key, interestingly enough, by the way, in the fitness industry and in sports in general, I think it's one of the things where you'll see occasionally an amazing football coach who is not a great football player. And I actually think some of the best coaches. So in the physical realm, because there is so much genetics involved where you cannot under any circumstances become like, no matter how hard I tried, I was never going to be Michael Jordan in basketball. I just didn't have the physical ability. But because I was actually an average athlete or maybe a very slightly above average athlete, I had to work very, very hard to try to get the starting role on the team or whatever the thing was. That is often the thing that makes you the better coach year in and year out. Think about Michael Jordan. Not a great coach, right? Great return on investment for his physical ability, which was unbelievable. Right. But not a great coach. But in the world where you can take that knowledge and skill and experience and turn it into expertise, I think you have to have that first 99% of the time before you start to climb the ladder to become manager and owner and understand how could you possibly know how to train people underneath you, how to be a great coach who have never coached, how to be a developer, who've never developed, who've never done engineering. I've never written a line of code. It's one of the reasons why I've still held to the standard that we are, as a company, a service business, because I have developed an expertise. And again, I say that humbly over the last two decades in service. I can't write one line of code.
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A
Yeah, yeah.
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B
So I hire experts to write the code because I don't know how to teach you and your team how to write the code. Now, I'm very lucky that I have a brother who can help, who can help with the team to write the code. And that's what you do. And I think that's one of the reasons we've been successful. But the downside And I'm sure you see the same thing in my world, in my service business world, when I go to a restaurant, when I go to a hotel, when I go to anything in the service business, I am wildly judgmental. Yeah, horrifically judgmental. And I'll bet you're the same in tech coding. Like, these things that you're like, how did they miss this? How did.
- [12:20]
A
And it's so consistent. You see the same problems over and over again. The same problems will always repeat in these because they emerge for a reason. It's sort of like people don't understand how to do it or they don't know how to, you know, execute on it. But, you know, that that sort of also feeds back to a conversation we had recently about how you actually do marketing inside of these types of organizations. Remember that when you start seeing patterns, especially in the service businesses that you, you know, for anybody who's, who's going down that, that path, when you start seeing these consistent patterns, people failing at this over and over and over again, companies failing at this thing over and over and over again, you've got rich content. Because that is the thing that people don't understand. That is the thing you need to focus on. That is the thing you need to drive whenever you're doing sales.
- [13:08]
B
That's right.
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A
Because that's the piece that people can cling onto. Oh, I don't know how to do that thing. This leads us to this, these different roles within the organization. So in any organization, as you're starting to build this thing up, you've got the technician that does. Right. The expert in whatever. You've got the manager who ultimately, that role is a role that does two things. It manages and plans what needs to be done, but it also manages and plans for the people that it's going to grow into a larger organization over time. And actually, that's the piece that I see missed most frequently.
- [13:49]
B
Most efficient.
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A
Yes.
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B
Great managers are the hardest. There are great owners and great entrepreneurs and great visionaries, and there's great technicians. And there are very few great managers.
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A
That's right.
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B
Very few.
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A
That's right. And part of that is the shift in mindset that has to occur. From an expert technician into a manager is a big leap. And I think what makes it so hard, I use this example quite a bit. And I guess it plays nicely in your world too, Matt, which is like, you've got muscles that are super strong and you've got muscles that are super weak. Right. Just never trained them. And this is one of Those things, when you initially start a company, you start as a founder, as a technician, and you are the expert and you're proud of your expertise and you've built this thing up over time. How have you done that? You've done that by solving every freaking problem that was thrown at you from beginning to end yourself. That's how you did it, that you became the pro doing that right. And what happens as you make the transition is you have to change what you value. From being my skill to be able to implement this thing to my ability to make multiple sets of hands do that work for me, which is where the scale comes from. How you scale, that's how you scale. And that is a different, a completely different and incredibly weak muscle in most killer, really good expert technicians, in anything.
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B
That'S innate in any human being.
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A
I do not think that is innate.
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B
So we think about again, we'll probably do a whole episode on high output management. Is that what it's called? Andy Grove. Andy Grove is a guy who became the CEO at Intel, was a lead engineer, was an incredible engineer. And then a mid level manager came over, Bob Noyce, who was one of the original Traitorous 8 from Shockley. Like the original guys that did Silicon. The reason it's called Silicon Valley is these guys. This is Gen 1, right?
- [15:55]
A
That's right.
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B
And Andy Grove is Gen 2. And he is now known as like across the board. It's pretty rare in the tech industry or in any industry where people would say, like if I said, if I just pose the question, we could do this on. Even on LinkedIn, say, who's the greatest tech manager of all time? I guarantee you Andy Grove wins. Yeah, by probably over 50%. Like across the board, people will agree. And his book on management, on managing people, it is the textbook of how to go from technician to manager, not from manager to owner, not to CEO. He wrote Only the Paranoid will Survive as a CEO of intel and, and did great as a CEO. But ultimately his great work that he gave the tech industry and I think generally in business was he learned how to manage people. And it's interesting, the guy was like half deaf and he was a Hungarian immigrant, so he was mostly deaf and had an accent, a pretty thick Hungarian accent. And yet he knew how to train people to be expert technicians. And that is key. And so that is a muscle, just like the physical, just like when we talk about, okay, so you've got weak pecs, it's almost New Year's and you're like, I'm going to Start to train and I don't have weights and I'm going to do pushups and you can do three pushups and then a couple days later you do five pushups and a couple months later you do 50 pushups. And you have quantifiable evidence that you've trained the muscles of the push up, the pecs, the triceps, the delts, et cetera, those have gotten stronger. There are people who are natural born visionaries as entrepreneurs and there are people who are naturally born to just pursue greatness in a technical skill, whatever. The thing is, that is the passion they follow. I don't know that there's anybody that is, I mean, honestly, the best one maybe I ever met was our dad. Our dad. The thing about our dad was he was, he even said this. He was a great number two.
- [17:58]
A
Yeah, yeah, he did say that a lot.
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B
He was like, I, he was a great number two.
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A
Role number one. But role number two, that's for me.
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B
He's like, I don't need to be on the, on the pedestal, on the podium. I don't need to be in front of the crowd. But he knew, like, and he was one of those guys that, that almost nobody, anybody that knew him in his life when he was healthy, before he got sick would say, like, he was just a great people person and he knew how to train people.
- [18:22]
A
Yeah.
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B
And so he looked at the personalities of people at his job or his church or whatever and he figured out where to push on them. Where they were great or where they had the potential to be great and do that. And I think going from technician to manager is the hardest thing to do. It's the hardest thing to find as an owner for guys like me and guys like you, finding great technicians, especially as the world has become small with the Internet, great technicians and experts are actually not that hard to come by.
- [18:50]
A
You can get them. Yep.
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B
The great managers are real hard to find.
- [18:54]
A
One of the hard pieces about this, you know, when you, you think about building a business and the way the path of the technician, you know, founder, who starts moving up is when you start working on those managerial skills, which you will have to work on, everybody has to do it. You're going to be slower at first. And I think that's, I think that's part of the reason that people don't do it. It's going to take some amount of time away from the technical work, away from the ability to deliver for your customers in that way so that you can develop humans that can start helping you you know, build out the business and do the things that need to be done.
- [19:33]
B
Technical work will actually reduce. It will absolutely reduce expertise for a period of time.
- [19:39]
A
That's right.
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B
And you have to be willing to sacrifice that time to train up the people who will eventually, if you are a phenomenal manager or phenomenal coach, will coach people better than you ever were as an expert in the same field. That's the marker of a great manager.
- [19:57]
A
They will create more technicians. So initially, your job as a manager is to create and make technicians effective. You eventually want to be good enough at that that you can make those technicians become managers themselves. Because you understand that journey from being a technician to a manager, you've done that, you've taken that step. You understand that, hey, this is going to suck and it's going to hurt a little bit for a while because you're not going to be able to do the thing. And especially for people that really love the thing. And this gets us back to the original topic of the whole freaking book. The whole idea is, you know, if you're a great baker, you're great at making pies. You probably love baking and love making pies. And guess what? You don't get to do as a. As you grow the business, you probably.
- [20:44]
B
Just want to bake, because that's the thing you love.
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A
If you're going to make a great business, you will not have time to bake.
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B
Right.
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A
And I think that is so hard for most people to get through their mind that the thing that they love to do, the whole reason they got in the business for the first place, was because they love the technical aspect of the job. But by definition, for your business to grow and be effective, you must lay down the technician completely, which means you don't get to do some of the things you love anymore. And you have to find a way to learn to love the other stuff. And if you don't love the other stuff, it's actually an excellent tell that you shouldn't own the business.
- [21:22]
B
Yeah, we've been talking kind of at the 30,000 foot and somewhat ethereal view. Let's go tactical for a second. So if you love the technical aspect, if you're an incredible mechanic, if you're an incredible coder, developer, if you're an incredible coach, and ultimately what you want to do long term is make a lot of money doing that, that's what you should do. You should just continue to build your expertise and just develop a name for yourself as the best in the world at this technical ability. Not to be a manager or an owner if at some point, and I think a lot of this is personality driven, this is in me and this is in you. I don't know how to run a mom and pop owned business. I'm just constantly thinking about how can I run the biggest fitness business in the whole world that's ever existed in the history of the world. Like that's the legacy that lasts for hundreds of years and the values that. And if there is a pull that is so strong that you have to go that direction, then you have to walk through the process of going from expert technician to expert manager to expert owner. Now here's the thing that I think is makes it less scary. And we've got a future episode talking about founder risk is that the best way to learn how to do this is to hire actually the low expertise, low dollar per hour wage jobs first and learn the ability to manage those people first. So for me at the gym, when I owned the gym, this was the custodian. A custodian is a, you know, back then was a probably an $8, $9, $10 an hour job. Now maybe it's $20 an hour. Now it's over a decade ago, but that is a low skill wage job job that I could cut my teeth on learning how to manage. And the most of the book of e myth after it kind of lays out this thesis is how to write systems and standard operating procedures. Because in the beginning, almost every business starts as an employee of one. You are actually the owner, the manager and the technician. You're all three.
- [23:24]
A
That's right.
- [23:24]
B
But if the business is ever going to grow, you have to grow out of the technical aspect, out of the technical expertise. Well, the easiest place to do that for me at the gym was to teach somebody how to clean the gym, right? And then the front desk staff, how to answer the phones, how to give a tour, how to sell a membership, how to deal with bounce credit cards, how to like those are relatively that's a low risk, high reward balance. So that it freed up my time to be more of an owner while also being the most high value technician. There is a time when you'll be an owner, manager and the most and for me, which was the coach or for you is the highest dollar per hour developer while you are developing the skills of the people underneath you and so you develop those skills of the lowest skilled, lowest wage people first. Another place that I remember, I've told this story in other podcasts before I went on vacation many years ago To Florida. And I was on the beach. It was like, payroll pre day. Pre payroll day. I'm doing payroll on the beach, and I'm the guy paying payroll. And I'm like, what am I doing? Why am I calculating payroll? And as I calculate payroll, that cell that has the sum of payroll at the bottom. And the business was growing fast. So I'm like, oh, it's a $30,000. No, it's 40. Fuck. $45,000. Oh, it's a $50,000 payroll this month. And then I just get depressed. Like, I. And I'm like, why am I doing payroll? I could hire somebody to do payroll who's an expert at payroll. Train them how we do payroll, use their expertise and payroll experience already. Blend it with what we do, and then just tell me the number. Just give me the shot in the arm, and I'll just. Okay, it's 50 grand. Okay. Ugh, here it is. That's how much is coming out of the bank account, which, you know, now is a 50. I would do anything for 50 grand payroll. But, you know, back then, I remember thinking, like, when we crossed over, like that $50,000 mark, it was just this painful thing. But what was more painful was the work to do it.
- [25:25]
A
Yeah.
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B
And so to hire out those positions and to manage those positions well, I would say is relatively low risk and high reward, allowing you to free up your time to do both. More ownership responsibility.
- [25:39]
A
That's right.
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B
And more high technical responsibility that you charge $100 an hour, $200 an hour plus for. Because you shouldn't be doing the payroll job, which is a $25 an hour job, or the custodian job, which is a $15 an hour job, or whatever those things are. So cut your teeth there. And then the day came when I hired a gym manager, and that was more risk, but it was also opened up a lot more time. And then the day came where I started to really train the coaches. Here's how I coach. And I would run seminars on Saturdays for my coaches on how I coached and how I developed my coaching ability and what the first session looked like and how to make sure that the clients walked away with a win and they felt good on day one. And how they didn't, you know, how you kept them from churn and all those sorts of things. That's how I think you cut your chops as a manager, so that eventually what you're doing is you're no longer managing custodians and payroll people. You're managing the top tier. Experts of the technical ability that your business does.
- [26:40]
A
That's right. And by the way, this is a good point in the conversation for us to bring up that this book, the E. Myth revisited book, pairs exceptionally well with buy back your time by Dan Martell.
- [26:52]
B
Yeah.
- [26:53]
A
Because it goes into a little bit more of the strategy to actually implement the execution portion of some of these things where essentially once you hire those lower level positions, they're the things you can almost think about that could be more easily automated. If it's a knowledge business that's hard to do, obviously in a editorial role, but in the case of a knowledge business, it's usually the bookkeeper or payroll or whatever. Right. It's those things that you're trying to hire out because they're also usually commodities. There are things that you can essentially buy for price, exactly what you're looking for because the skill set is well known and it's already well defined. And you don't have to write that much in terms of playbook or instruction on how to execute the thing that needs to be executed, but it is the way it goes. And a callback to a previous episode, we talked a little bit about how the longer you do a thing, the more you tend to fall in love with it. So one of the things I just want to throw out there for people who are thinking about this path and trying to decide, you know, do I want to be, I don't know, do I just love being a technician and I just want to be the technician, or do I want to roll into the manager and eventually move my way up? You really can't make that decision immediately. When the muscle is weak, it's going to feel miserable again. This is such a great parallel to workouts. I feel like when you very first start working out, first of all, you grow really fast, which is great, but it's the hardest.
- [28:25]
B
It sucks and you're the most sore and all that.
- [28:27]
A
You're the most sore, all the things are awful. This is not the time to decide whether or not you want to do it. Eventually you fall in love with it. It becomes very interesting as you learn how to mobilize an army of technicians to get things done. That feels incredibly empowering. And that feeling that you get as a founder when you are only the technician or you're the only technician that's around of just constant overwhelm. If I worked every second of every day, I wouldn't get everything done. That feeling goes away when you've leveled up and acquired the skill of being able to put many hands to work on your behalf to get the things done that need to get done. And it's, it's wonderful. Like, it can be a really glorious thing to move in that the best.
- [29:16]
B
Feeling in the world is when, you know, I go on vacation, I'm going to go to Mexico. There's more. By the time you guys listen to this, I'll be packing to go to Mexico and I'll come back from Mexico and the business will have advanced because the team is great and they will have accomplished things that I had nothing to do with, but I set the culture in. So then the question is, how do I make that leap? And the next big step of that book is that you have to do the thing that no one wants to do, which is sit down and write systems and standard operating procedures, like literal, technical, checklist, manual, the things that you hate. There's probably somebody out there that loves. There are probably people out there that love writing systems and SOPs. But I think in a business that you own, especially when you have been the expert technician, you're the guy that has to write or lady that has to write the original sop. And the point of that system or standard operating procedure of here's how we do a thing from cleaning the gym to code work, to making sure they're like back check the code to make sure there's not technical debt, all that kind of stuff, right? To write that thing. And then the most empowering thing is you write the thing which you know is a living document and you know is not perfect, but you've done it multiple times, probably thousands of times, and then you hand it off to a person and you say, this is not my system anymore. This is your system now. In the first couple weeks, I want you to follow my system to a T. It's in a step by step checklist, literally, but pretty quick. You're gonna find places where this system is not perfect, it's insufficient. And there's gonna be places where there are gonna be steps that need to be taken out. There are gonna be steps that need to be added in. There are gonna be steps that need to be. Step three needs to be switched with step seven, but that's yours now. And what that does is it gives your employees and the workers and the people that you're managing a sense of true ownership and responsibility. Not just maybe a sense is not the right word, like actual ownership and responsibility in the task at hand. So, like, this is your responsibility now to make this. To take what I've built which is a living draft and turn it into something great and yeah, go ahead, let's.
- [31:27]
A
Amp this conversation up slightly. Okay. So one of the things I feel like is interesting sort of just hit me in the brain is when you first start designing these systems where you're going to sort of lay out what needs to be done. They really are low level standard operating procedures. And the way that you do that, the way I tell people to do that, especially again in knowledge businesses, is to turn on a screen recording video solution. I use loom. Most people at this point probably use loom or something similar, record your screen while you're talking through the thing and hand them that. In fact their first thing can be to listen to the video screencast that you're doing and write everything down in a very particular order that it needs to be done in a Google Doc.
- [32:15]
B
Somewhere or even here's what's crazy before and same for you. I sat at my desk for three months, for 16 hours a day and wrote systems. I could now record a loom video screen recording video, send it to Fireflies or some transcribing and say put that in an order of operations and then take that look at it, even run it through more chatgpt other AI until it very quickly could actually get a written order of operations step by step. Step one to step 50 checklist of the SOP. Back in those days I just had to type the sop.
- [32:53]
A
Do it. Yeah, here's the thing. Today this is such a perfect case for AI. The other, the other sidebar of our sidebar that I will mention is just that you can also use AI to poke holes in your standard operating procedure. Tell me all the places that I'm not thinking about, blah blah blah. And the best model for that by the way, are the O1 Strawberry models from ChatG at the moment, the reasoning models. But to get back to this as we start scaling the SOPs. So SOPs are the first thing that you're going to do, right? That is, that is a basic entry level skill set for this transition from manager to entrepreneur. But the next thing that you have to learn how to do as the people that you're training are moving up from low level employees to what I would consider maybe mid level employees, people that can. People that have more capability to run your business, eventually you have to start communicating in documents that are different than that. It's not go in and do step one, do step two, do step three. It becomes this is the vision for the future. This is the way the future could be. And this is the way that I see this thing rolling out in, you know, what our world could look like in a year, in two years or whatever. And here is a rough strategy to get there and get alignment on that process. So what you learn over time is this process of communicating to your employees, to your staff is pretty much the whole job. I mean, it's pretty much what you're doing, especially if you're naturally an entrepreneur. If you're an ideator, you're somebody who thinks a lot of ideas, you got ideas, you know, coming out of your ears and stuff. If you're that person, the thing to always remember as you're scaling through this technician, manager, entrepreneur role is that nobody knows what's happening in your head. Nobody knows what's happening in your head. The way that people find out about that is by you writing it down.
- [34:50]
B
Yeah, you have to tell them.
- [34:51]
A
And I will also say that I think it's important pretty early on to establish a practice of writing this stuff on, you know, a Google Doc or wherever you, you would put this wherever you put your standard operating procedures. Because once you have written it, it now is in a form that can morph over time. But if you just say it, it can't. Right. People. And people remember it differently. Well, you said, blah, blah, blah, blah. No, I didn't. I said something else. Right. Like, at the end of the day, one of the most important rules is that the person who writes it down wins because anybody else is just generally, what we see is that people are just too lazy to write it down. So whoever writes down the idea, this is how we're going to do this thing, this is how we're going to execute on. This is the strategy we're going to use to move this thing forward ultimately, ultimately wins. You have to keep scaling up your ability to communicate to your staff and your employees. And that leads you to this entrepreneurial role where not only are you designing systems, but you're starting to think about things like what else can be done in this business to make this business better, generate more profits. And that requires that you are plugged in enough to the ecosystem, overall, whatever ecosystem that is, to see trends.
- [36:12]
B
Right.
- [36:12]
A
If you want to have that amount of time to be able to do that kind of thing, the only way you can do it now, it's easy to see, right? We've walked you through it, technician to manager. Okay, well, you, you've started to lay down the technician role as an entrepreneur that is looking at industry trends. Where are things going? How are we going to do these things? It should become quickly clear why you had to be a great technician, why you need to have great skills as a manager. You don't have to be the best manager and you don't have to be the best technician. But for you to be able to see around the corner of tomorrow, somehow in the business, you better understand that business super thoroughly as a technician and as a manager, how to motivate your employees, how to give them vision and the strategy that needs to be executed. All of those things make it clear as to why this stair stepping process of growing from technician to manager to entrepreneur makes so much sense.
- [37:08]
B
Yeah, and this is the concept that really is the third major concept that Gerber goes into, which is the transition of working in the business all the time to working on the business.
- [37:17]
A
That's right.
- [37:18]
B
And so a great owner entrepreneur is someone who's able to work on the business in the bulk of their time. The important stuff not work in the business, which is the urgent stuff. And by the way, that stuff always exists. There's always some level of urgent and important that we have to do. But the more we can free up our time to work on the business and not in the business is when you've really made the transition from technician to manager to actual owner, entrepreneur, innovator, visionary, like that thing. And then Gerber goes through his own. It's kind of interesting. I'll give a shout out, by the way, I don't know if you know, December 10, which is just in a couple days, my book Undoing Urgency comes out, which talks through a lot of these things, which I think you're going to get a copy of in the next day or so.
- [38:04]
A
I ordered originally a bunch of copies.
- [38:06]
B
So you'll get a signed one and yeah, and you're in all the acknowledgments and all the Ford and all the stuff. But he talks about this concept of what I think he. In our notes, we've got like innovation, right, which we would call goals. Like the thing that is like the finding the new ways to improve the business. And not just my personal business, but where's the industry going? Can you see 2, 3, 5 steps ahead as an entrepreneur? The quantification, like the metrics that matter, how we're going to measure that we're actually making that improvement, right. The orchestration, which is making sure that Those systems and SOPs all work together. You're not the one having to like marionette if you're watching video you don't have strings on your fingers running all those. You've got great people that are doing that and building a business. Ultimately the goal is to build a business that works without you, where you are not integral to the business. And that is maybe down the road and maybe even so, like far down the road. Even for me, that is my primary goal of the business that I have now. But that still seems out of reach. Right? And it probably does for you for your current business.
- [39:09]
A
Oh, yeah.
- [39:10]
B
But you've got your original business to that point where the business was able to run and you were able to sell and be like. And I remember you texting me and you're like, I'm retired. And you were still like on the board, chairman of the board and stuff. It's like, you're like, I don't have to be. I don't have to be the CEO, the CTO or the whatever, COO or any of that stuff anymore. I don't have an in the day business and job. And so for us, we look at those things and we say, that's the game plan. In the Undoing urgency book that I wrote, which is just as entrepreneurs, we set major goals for the business. We set the two or three actions that support that. This again comes from kind of okrs and Andy Grove and I just like our terminology better because my employees grasped it better.
- [39:51]
A
It's way better, by the way. It is way better terminology.
- [39:54]
B
What are the two or three actions that support the goal? So again, it's called game plan stands game G A M E. Goals, actions, metrics, execution. So what are the major goals? What's the innovation that we need to make? What are the actions that we have to complete? And the actions should have a deadline and should have a yes or no answer. Did we or did we not complete the action? If the three actions I laid out that I said that these things, these actions will complete the goal. Don't complete the goal. I screwed up. I screwed something up. Right?
- [40:22]
A
That's right. Wrote them poorly.
- [40:24]
B
If you do the things and you say, I completed action one, action two and action three, all right, we completed the goal along the way, like kind of what we call targets to improve, like TTI metrics, which again, kind of corporate Y and I hate. But it's kind of the metrics we're shooting for. And then there's the KPI metrics, which a lot of people have heard of, which is kind of like, where are we today? And what's the delta between today and the TTI and that is the quantification for Gerber in his book. And then the execution process is the orchestrations for us. It's that day to day, week to week checklist of like, yeah, I've heard a lot about you, as you have too. Again, we'll try to stay away from being political, but with like, Elon and Vivek and Doge, one of the things that Elon is famous for is saying like, what did you do this week? What'd you accomplish this week?
- [41:12]
A
Yep.
- [41:13]
B
Well, can you imagine going to government agencies, going to the EPA and being like, and what did you accomplish this week? And they go, but that's what we have to do in our business. That's the execution plan. That tells me that we are moving closer to achieving the actions. And if we achieve the actions and if we understood the goal correctly, when the actions are completed, the goal will be completed. Right. And so then, as the goal is completed, we celebrate and we move forward. But also, there is this process too that I think is really important, which is that when you build a business that is thriving, it's not just about accomplishing the goal. There's tremendous joy and value in the process of pursuing the goal. That's the galvanizing thing. It's not. Rarely has accomplishing a goal like you could accomplish a goal and give, let's say everybody gets a big bonus structure and you put thousands of dollars in everybody's pocket or stock options or whatever, and everybody gets excited for about four days. But ultimately, the thing that's galvanizing is the pursuing of the goal, not the achievement of the goal.
- [42:17]
A
You never learn that deeper than in the moment when you do have the opportunity to sell your business and exit in a way where the business doesn't need you anymore. I hope everybody gets that opportunity. They don't. You know, I mean, I know that not everyone will get it, but it teaches you so much about yourself and about human nature, because you believe that the pursuit of that goal for so long is the goal itself, is the thing that you're after. And it's not until that same randomly, you know, week or two after an event like that occurs that the newness wears off and you go like, oh, it was actually the thing that I enjoyed. I actually, actually like doing the thing. I like the pressure. I was addicted to the risk solving. I like the problem solving. I like to be useful. I like to move things forward. And you understand in that moment something that many human beings don't ever get to understand. But trust me, it is the case that that is where the joy's at, like getting in and doing the thing and moving things forward.
- [43:19]
B
I think everyone should be able to understand that, even if they don't understand it from a business perspective. Because in any materialistic sort of standpoint, if you save up to buy the car and you work hard and you work the extra hours and you pursue the goal, then you buy the car, then the car is so awesome for a couple days, and then two months in, it's just the car, it's just the family car, whatever that distance, or your dream house or whatever the thing is. And then you're in the home. And man, we love our home, but like, there's all the newness wears off of that thing. And so everything. Yeah, I talk about this a lot, actually. I do. This is how I kind of in my book, so I won't do too much of it. But we grew up watching Michael Jordan. We're children of, you know, the Bulls era as well as kind of beginning of Kobe era. I am actually, I was a huge Bulls fan, A huge Michael Jordan fan. Still a huge Michael Jordan fan. But the guy pursued the championships, like championships were what he wanted. Kobe just wanted to work as hard as he possibly could and enjoyed the championships. But he understood that the joy was in the work to get there. And this is why I think that when you watch videos of Jordan today, Michael Jordan, if you're watching this, I apologize. Why his eyes are yellow and he's drinking whiskey and his liver's probably all jacked up because the guy pursued the goal and the goal was where the joy was. And pretty quick, after the celebration of the goal, the joy goes away and you just look at the next goal.
- [44:44]
A
That's right.
- [44:45]
B
Instead of pursuing, the joy's in the pursuit. Right. And so as we think about who we want to be at 80 years old and the legacy we want to leave, business, parents, spouses, community leaders, whatever. The thing is, it's actually not to achieve the goal that you're hoping at 80, which is. Would be wonderful. It's in the 60 years leading up to it. That is where the joy is. It's in the. Because otherwise you put yourself in bondage for 60 years to reach the goal, and then the goal hits and you find out like, oh, the goal actually didn't make me any really happier. It's the joy that lasts. I've said this before too. Happiness is fleeting. Happiness is like passes. Joy is long term. And so like, joy is enjoying. Enjoying the pursuit of the goal. And then, of course, celebrate the goal, of course, go on the vacation, of course, pop the Dom Perignon, like, have some fun. But then realize, like, the meal is over and the champagne is gone and you're off the cruise and you're back home. And now what it's about, the pursuit, like, 99.9% of your life is the pursuit of the goal, not the goal itself.
- [46:00]
A
That's right. And just very, very difficult, I feel like, as human beings, to remember that, because the thing that we're staring at is still the goal, even when we're in pursuit of the goal. And so the achievement of it. But. But it is absolutely the case that the same feeling you get when you buy a car, when you save up to buy a car, you buy a car and you love it for a couple weeks, and you're super excited for a couple weeks, and every time you get in it, you're like, this is so great that that wears off. Every single other thing in your entire life works that way.
- [46:28]
B
Yep.
- [46:29]
A
And so what you want to do is constantly remind yourself that. That in every area of your life, in if it's business, we're working, you know, talking about ETH and the growth of entrepreneurship, if it's relationships, all of those things work the same way. Newness wears off, and you're left with the pursuit of growing the thing.
- [46:50]
B
Right.
- [46:50]
A
The effort in moving the bar forward every day a little bit and getting better over time.
- [46:56]
B
Yep. Yeah. Imagine your 50th wedding anniversary, which is a great thing, but what made it great, 50 years, the 49.9 years before.
- [47:07]
A
That's right. That's exactly right.
- [47:08]
B
Like, that's the thing. It's the memories and the life that you've built for the 50 years with the person that you love or the business that you love. And so to look back, I mean, I can remember there's been times in the last year or two where my executives have said, I think we're going to look back on this time and say it was the greatest time in the history of the business. There will be times in the future where we have to do hard things. We may have to fire people, we may have to sell. We may have to. Whatever those things are. But inevitably, as the business grows, it will change the business. But there's a time when you've got to step back and actually see the forest through the trees and enjoy the process of what you're doing. And so ultimately, Gerber's point is this. If you spend all your time as an owner working in the business rather than on the business. And you don't own a business, the business owns you.
- [47:55]
A
Yep.
- [47:56]
B
That's the primary thesis of the book. And the goal as an owner of a business is not to be owned by the business. I can be owned by any other boss. I mean, I was a public school teacher. I was owned by government schools. Right. I can just as easy move into being a founder and entrepreneur and be owned by my business and be in bondage to my business and in bondage to the schedule and location and the work and the technical aspect and all the things. And if I don't work hard to be able to build that scale, that grow that manage people, Write systems and SOPs so that I can do the thing that I really love, which is to be an owner and an entrepreneur, then I haven't actually accomplished anything. I should have just stayed and been a public school teacher. That's the point.
- [48:40]
A
It's going to be a lot easier. Right.
- [48:41]
B
There's a lot less stress with the ultimate goal that we work towards, knowing that it's not going to bring ultimate joy, that the business can eventually completely run perfectly without you.
- [48:54]
A
Yeah.
- [48:55]
B
That's ultimately, I think, the goal that we're pushing for. And when that day comes, then you get to make a new decision about life.
- [49:02]
A
Yeah.
- [49:02]
B
Do you? You did. Do you want to do a new business? Do you want to mentor young other business owners? Do you want to play golf five days a week? Like, that's not me and that's not you and that probably never will be us, but it gives you freedom to make the decision. I think that's really what this is about. Ultimately, this whole conversation is about freedom versus bondage. Are you in bondage to your business? Are you in bondage to your job? Or does your business give you freedom to do the things that you could never do if you worked for somebody else? That's the goal.
- [49:35]
A
And also remember, you get one extra thing when you get to the end of that, that path. So let's say that you do get to the point where you're able to fully sell the business and do that. You have one other thing, and that is you are now the kind of person you are. You are the person who knows how to do it.
- [49:52]
B
That's right.
- [49:53]
A
You've got it in your bones. You understand things that people who haven't walked that whole path don't understand. And you can do it again if you want to. And that is actually where the value is actually stored. So you've You've built a company that is now able to just generate tons of value, which is how you make an exit, right? But now the actual long term value is stored in your mind. That is the thing. Because now you can turn around and do it again. It's the reason that when we find really effective entrepreneurs, we find that they tend to not only start one business, they do it multiple times, over and over again. And you could have dropped them in any time, in any place, with any amount of resources and they would have done it every time.
- [50:33]
B
They would have figured it out. Yeah, yeah, yeah. Every major milestone in my business I'm very grateful for. Even the lawsuits, you know, raising money, series A, things like that. You've been a great help to me because you've always been a few years ahead of me. The one thing you've been able to do is you got freedom from a business and you started a new one and you have a new successful business. And by the way, if you're my employees and you're listening to this, that's not my goal. That's not my goal right now. But there are these things that you go through, these milestones. You're like, oh, you know, I've done, I've learned how to train people. I've learned how to Write systems and SOPs. I've learned how to manage now I've learned how to run. I've learned how there's a culture in our company. I've been sued in federal court. And now I know what it's like to go through a lawsuit, which is terrible, but now not scary. Because once you go through it, you're like, now I know what the process is like. Now I know what it's like to raise money with investors who by the way, if you think like you're talking about high pressure phone calls, somebody's going to give you a million dollars or half a million dollars of their own money out of their own pocket. They're going to ask real hard questions and you learn how to, how to have answers to those real, authentic answers to those questions. But you've actually been able to cross over and sell your first business and move into your next major business. And that's a skill level that the vast majority of people don't have. And so this is a process. Everybody is on that spectrum somewhere. And for some of you, you're listening to this, you've never even started the business. So coming back to the original question, should I start a business that is my passion or is the thing I'M great at. I would say this. Yeah. But make sure that you actually want to own a business and not just be a technician, number one. Number two, do not leave the safe job until the new job is making enough money to replace the money of the safe job. You take all the money from the new job and you sock it away and you don't spend it and you don't raise your standard of living. Because if you're making 80 grand at the old job and you're making 40 grand at the new job and then 60 grand and then 80 grand at the new job, now you're making 160 grand. Well, if you're living 160 grand lifestyle, you can't leave the 80 grand old job anymore.
- [52:33]
A
Yep.
- [52:34]
B
So the Should I make this a business? I would say absolutely. And we'll walk through that with you over the next many episodes of this podcast of how to do that. Make sure that you actually want to own a business and you don't have to be in a rush. There is a time period where everyone has to understand. All new business owners, I believe, should work two shifts. Shift one is the one that pays the bills and the mortgage and the groceries and takes care of the family. And shift two is the thing that you're passionate about, that you're trying to build. And I think most business owners have 18 months to two years to build that up to a point that they can replace the old job. If you haven't done that in 18 months or two years, it's probably a good idea to go like just go back to the old job.
- [53:19]
A
That's right.
- [53:20]
B
Just fine. But if you can do that, do that well. Do not raise your standard of living so that you can make that transition as easy as possible.
- [53:29]
A
Spot on.
- [53:30]
B
Awesome, man. That's another episode of the Build you'd Business podcast. Thanks for listening to me, Matt Reynolds and my brother Chris Reynolds, and we'll see you guys next Friday. I hope you have a great holiday season season. We're going to come back at you with man, how to bootstrap this stuff, how to start a business again. As somebody who started several businesses, both you and I, what we would do different, what you did now recently as opposed to what you did in the past. I think it'll be a great episode. So we'll catch you guys next Friday. Have a good one. It.