Answering Your Questions [Live Workshop]
Summary
- Always start by simply asking for referrals from happy customers. It’s a basic and effective strategy often overlooked.
- Create incentives that add value rather than removing pain, such as offering a $500 gift card instead of discounts.
- Begin with a standard Customer Acquisition Cost (CAC) for referral incentives and adjust if necessary.
- Simplify the referral process to make it easy for customers to refer others by providing clear steps and pre-written messages.
- Filtering candidates before they join ensures you attract the right team members who align with your company culture and expectations.
- Set clear expectations during the interview process to attract the right talent and repel those who are not a good fit.
- Processes for hiring should be established early, even when the team is small, to ensure future growth and consistency.
- Focus your time on relieving the main business constraints and planning for future needs to stay ahead.
- Introduce new marketing channels to avoid dependency on a single source and consider potential constraints after solving the current issues.
- Delegate day-to-day operations to a capable manager so you can concentrate on growth strategies.
- Clearly define what you want from an operations manager and ensure they align with your long-term goals and vision for the company.
- Improve leadership skills by focusing on one improvement goal at a time and consistently practicing and reflecting on interactions.
- Provide team members with alternatives rather than critiques and create an environment where they can self-assess and provide feedback.
- Use automation and reports to get team members to self-reflect, such as end-of-week reports with a rubric for self-assessment.
- When changing the company culture, directly address the behavior that needs changing, provide frequent feedback, and ensure the person understands their impact on the overall culture.
- If a new hire negatively changes the culture, address the issue head-on with direct feedback and consistent follow-ups.
- Frame and context set the tone for feedback, ensuring both partners are on the same page and use data to support arguments.
- For businesses under financial constraints due to the product lifecycle, focus on both front-end scalability and enhancing customer lifetime value with recurring revenues/products.
- Aim to create a strong, trusted brand that consumers will buy from repeatedly, not just individual products.
Video
How To Take Action
I would suggest implementing these strategies that can make a significant impact with minimal costs and effort:
Ask for Referrals
Start asking your happy customers for referrals. Literally, just ask. Do it multiple times. Make it easy by giving them pre-written messages they can send to friends or family. This doesn't cost you anything and can bring a lot of new business.
Offer Meaningful Incentives
Use incentives that add value. Instead of discounts, offer something like a $500 gift card. It's more appealing and makes customers feel like they're getting something extra.
Simplify Referral Process
Simplify the referral process. Outline clear, simple steps for how they can refer others. The easier it is, the more likely they will do it. Give examples that will make them think of specific people who might benefit from your services.
Set Clear Expectations for Hiring
When hiring, set clear expectations from the get-go. During the interview process, be upfront about what you expect and what the company culture is like. This helps in attracting the right talent and repelling those who are not a good fit.
Develop a Hiring Process Early
Even if you have a small team, develop a hiring process early on. This ensures consistency and helps attract quality team members as you grow.
Delegate Operational Tasks
Delegate day-to-day operations to a capable manager. This frees up your time to focus on growing the business. Make sure the manager understands and aligns with your company's long-term goals.
Invest in Leadership Development
Improve your leadership skills by focusing on one goal at a time. Practice and reflect on your daily interactions with your team. Use tools like end-of-week reports where team members can self-assess their performance.
Create an Environment for Self-Feedback
Encourage your team to self-assess and reflect on their progress. Use automation for reports and rubrics they fill out themselves. This fosters a culture of continuous improvement.
Address Cultural Issues Directly
When changing company culture, address behaviors directly and provide frequent feedback. Let people know the impact of their actions on the overall company culture.
Explore New Marketing Channels
To avoid over-reliance on one marketing source, explore and test new channels. This not only diversifies your lead sources but also prepares you for future growth.
Build a Strong Brand
Focus on building a brand that customers trust. This can lead to repeat business and higher customer lifetime value. A trusted brand can sustain long-term growth better than depending on one-time product sales.
By implementing these high-impact, low-cost strategies, you'll set the foundation for scalable growth and a strong company culture.
Quotes by Leila Hormozi
"Do you ask them to refer?"
– Leila Hormozi
"What's CAC right now?"
– Leila Hormozi
"Set expectations"
– Leila Hormozi
"How am I doing that?"
– Leila Hormozi
"Create a flywheel"
– Leila Hormozi
Full Transcript
welcome back today I'm going to show you behind the scenes one of our scaling workshops where I am answering questions from business owners of all different Industries and all different questions and so listen and hope you enjoy um raise your hand super high no T-Rex arms and I'm just going to try and get as many questions and I'm going to try and spread myself across the room sound good all right cool you were already I I appreciate it hey thank you so much for your videos very very helpful all around um we run a Mandarin Chinese online course we do a lot of automated onboarding uh and I really enjoy like getting that really dialed in and looking at the numbers and all that we recently introduced a once a week live stream for new members but what I'm very interested in is ways of improving the onboarding and in particular ways of getting our customers who are very happy with us we always get five star reviews to be incentivized to refer so we can get more referral uh Revenue do you ask them to refer not really you know I mean we should probably start with that it's literally like the first thing is most people I'm like do you ask them and they're like well no I just would like them to like well we start with asking yeah um yeah so something really interesting is um I have a a friend uh who they do referral plays right and they generate about on the front end uh before they even have the person use the product and get value from it they get about 30% of the people to refer somebody simply by asking every step step of the way and so they don't even give any incentive they're just like would this benefit your spouse your friend your this they give all the scenarios of all the kind of people that you can think through in your mind that it might benefit and so just to I say that to impress upon you like even just asking oftentimes does a lot more than people uh would think so in terms of giving somebody some sort of incentive um I'm a fan with referrals of giving people giving them something extra rather than removing away a pain so if you look at like how to incentivize people Let's either remove something that they're currently is a current pain it could be a payment it could be time it could be anything right or you could add an incentive I'm a fan of adding an incentive for referral because most companies say We'll you know comp a month we'll do this we'll do that I think when people are like we'll send you a $500 gift card that's a lot more meaningful in my opinion because it's not as common so that's the first thing I would do is like consider like how much could you pay for a customer as a referral and do you think that it's since a lot of these people would never have come to us anyway do you think we should be fairly generous with it like in the sense of like a lot of times I've heard you guys say pay C for this type of thing so but would you maybe even do more considering that it wasn't Revenue we were going to get unless we set up some kind of system for um I would start at CAC and you can raise it if you want it's a lot harder to go down than to go up so I always like to start and then say like great if I want to go up I can go up um but like also I would say like what's CAC right now about 120 for a 997 product okay and so if you what's the I would say like what's the difference between like 120 and 200 like yeah yeah sure I mean 200 might actually get you higher conversion in terms of referrals just because like the difference in terms of the hundreds but it might also not because it's not like a huge substantial difference so I would start at the 120 or maybe just round it to 150 um and then say like that's what we'll give you for a referral um and then I would teach them how to refer so like a lot of people the reason that companies don't get good referrals is because it's not easy you know like you look at uh door Dash or Uber all those it's like one button refer like it's seamless and so if you're gonna if someone's going to go through the headache of referring somebody the best thing you could at least do is teach them how to do it in like three easy steps to refer make it as frictionless as possible for them to refer write the message out that they're going to send to this person like literally like it what we've done in pretty much every company and in our portfolio companies we like here's the sequence you're going to send out to these people to refer them over to this thing because you know it's not like in some of the companies it's not automated enough in because their service not software so it's like we don't have a piece of software doing it for us so I would say first off um actually ask for it and ask for it multiple times like give them in the beginning I would say three opportunities to refer and then make it as easy as possible and pay 150 bucks yeah okay great thank you for sure all right right yes hands right here I come from an industry where it was very easy to keep talent and motivated because they were professionals they were engineers so it was easy for me to train and lead a a you know a team of aerospace engineers to design something but now going into the health space and having to skill higher and train lower skilled people um finding it really hard for people to stay with the mission and just do simple things of like hey I need you to smile when you say hi to the patient I need you to be courteous use their name and then they're like [ __ ] it let me go work at a hospital when I when I have to do nothing of that sort right so how do you make that transition between you know being able to lead like and have those Sops and having to constantly hire and and hire and hire over and over again for that well I would say this which is it's all about setting the expectation because you know you guys saw Frank's presentation yesterday um having a process in place like that what it actually does is it attracts the right people and it repels the wrong people and so for example if somebody goes through the interview process acquisition. Cal and they are you know not on board with like our motto of Praise over punishment and they're not you know really competitively great they're probably going to be like yeah [ __ ] this is really intense these people are like a [ __ ] cult like I don't want to work here you know what I mean and I want that because I want the opposite of those people to work here and so I would ask yourself like when you're having the process a lot of people this is the thing they're so scared of repelling people that they don't attract the ones that they want because they're like I don't want to offend anybody well [ __ ] that this is like they're going to quit their job to work for you that's a big decision we have to be completely straight up with these people like what are you walking into when you come to join this team and what are you looking for in a teammate and so you know a lot of and I know Frank goes over it with like setting expectations like I spend so much of my time on interviews you know I did a final interview today and you know what I did I said expectations I read in the notes that they've been set before I set them again you know and I just give my perspective on the role what makes or breaks it you know what my expectations are the three things I'm looking for I do all the same [ __ ] that we teach you guys and so I really think it's that like when you when you anyone voices a problem about like these are the kind of people we're getting you're just letting the wrong people in and so how are we going to filter for that before they even get a seat at the table and so I think it's literally just implementing what you learned yesterday and here's the thing is a lot of people say well okay Lea well you know you have this larger company this more team like of course you implement that that and some of you have companies just as large but just saying like I started doing that we had four people here like putting a process together for like hiring like I sat down for a day and like made a giant Assa board and guess what that board still exists today and the recruiting team has just innovated on it but like that kind of stuff it's not that you have to be the one doing the process every time having every single interview keeping with all the question questions you just make sure that somebody else does and that the process has been built and once you build it once it will work as long as you continue to refer to it and refer people to it and teach them how to use it um so I'd also say like I know you guys are a smaller team right now I I do not think you can ever be too early to implement this because who you get on your team is going to dictate how much your company will grow thank you for sure over here we're about 10 million Top Line and I've worked myself out of the company over the last couple years so I'm maybe two three hours a day and I guess I'm after the last two days I have a [ __ ] ton of work to do but after that's done what do you see as uh my highest and best use of time well what's your goal uh because if you worked yourself out is what's the purpose of the business for you there's no right or wrong answer just like no no no long longterm roll up other smaller companies get to 100 million Topline and then sell to private Equity okay what's the business Roofing Roofing nice that makes sense it's a good industry to do it in um so what can you do to leverage yourself right now I would say like over the last like you know day what did you identify as your constraint I thought it was sales but it's actually marketing sounds really dumb even saying it out loud why no so I thought I thought the constraint was sales so I had planned on we're actually hiring a sales manager I'm gonna hire a new sales people and all this but really it's I need to get other channels of marketing we're 90 well 90% of paid is Google 70% of our leads come from Google I need to spread that out understood okay and I would ask myself right now like I mean the way I see it is like my my job is always to move the company forward and like I said it to you but like pull the future into the present like how am I doing that it's usually by relieving constraints and also in the time that I'm not alleviating that whatever that one constraint is because I basically am like what I do quarter to quarter absolutely changes completely my schedule changes all the time how I manage my days it changes probably every two months um because it it's based on what problem I'm solving is it you know Marketing sales CS whatever right like what our version of that so um I don't think there's anything wrong with just focusing on what needs to happen rather than like you're the basically head generalist so like you go where you're needed right um I would say the second piece of that is like how do you get ahead right which is like looking at what's to come which is focus your main time on the constraint but then the rest of your time is always looking ahead saying what could I do now to prevent these things from becoming a constraint next and that's what I'm constantly thinking about probably once I've figured out how do we need to solve the constraint and assembled like the team that's going to work on it we have our initiatives then I'm thinking okay what's the next thing that's about to happen right because okay you solve the marketing constraint what is the next constraint leadership it's probably sales yeah yeah they go so were you that wrong of like okay it might just be that you're one step you're like oh it's gonna but it might be once you solve those channels then sales blow up oh wait we don't have enough calendars available because we don't have enough reps oh wait who's going to manage the we have to switch to another Oh wait [ __ ] that's me doing that wait I need a sales manager so I mean it always goes down the funnel for the most part especially if you start at marketing it's like likely next to sales than CS then and multiple things I would say like depending on their strengths or weaknesses could break at once or at different times but I would be using the rest of your time to think if that's the goal if the rollup is the goal how do I pull that into the future and I would be saying like if I if my goal is to do a rollup then I need to have systems that can repeat like clockwork so once I get something that works I don't continue to test it over and over I just want a system that works well enough that I can repeat this and do a rollup right and then I would say the next thing I'm going to need is shared services because if you're going to do roll up you're probably going to be managing the different entities you're not going to be managing their companies things like that but financials would make sense to roll up under one um and if you can do you know human resources that kind of goes with that under the same benefits roof to whatever degree they provide them and then it and so if you have a shared services department I would also say you're probably going to get a higher multiple on that rollup anyways so and I don't like I don't think it's that hard to build shared services for those three departments other departments to do like you're going do shared marketing all that that gets a little complicated but those three that would increase your multiple and it'll be super beneficial for the rollup in general so I'd be thinking like what can I be building in my spare time that I'm not solving my constraint that can move me towards that goal that okay I hope I feel like I just rambled at you for a second there so no I didn't okay cool all right right here in the gr um so we've got department heads our top line revenue is around 20 million I'm thinking I want to hire a like operations manager or like just someone to like be the point of like the head yeah and me step back and work on like just growing the business and am I on the right track and if so any advice on hiring that because I feel kind of scared because it's kind of like letting go of the wheel in a sense I don't know if I'm on the right track here or not yeah yeah I mean all I'll ask you these couple of questions which is one what are the top three things this person is going to do weekly daily basis managing all the department heads holding them accountable to their scorecards and then just putting out small fires you know random [ __ ] that comes up okay so it's mostly somebody who's a leader correct okay um how much of that person do you need to help you in facilitating growth in the company do you see them as somebody that you would like to grow into that or do you just want somebody to handle the dayto day I want someone to handle the dayto day so I can focus on growth okay um I don't I mean I think absolutely you're at the size where you could hire that people hire at half your Revenue I think it comes down to preference and where you want to spend your time you know what I mean like I like actually managing the core team that's actually something I really enjoy doing doing and it sounds crazy but it's it's I like it and so I just spread myself super thin but um uh I think there's no right or wrong is what I'm saying is like if you would prefer not to do that to just focus on this one thing because you know you operate best that way then let's do that you know because I think that there's different ways that you can play the role of CEO or founder some people don't manage anybody except for one person right and some people manage every person it's just like how do you know that you're going to work best and if all this noise over here is just too much that you can't get the other stuff done then get somebody and the only thing I'll say is this if you hire someone look for someone who is a leader who has influence and at this point if it's not something that you feel like you can teach that person then it means you hire for somebody who already has that but where a lot of people make the mistake is they hire someone to manage the dayto day and then what I see a lot of times is then it trans it transfers over they're like why are they not growing the company I'm like what did you hire them for and so I think that is a very important delineation to understand is like when I'm hiring for an operator I really think about like do I need somebody that can just manage or like manage and grow you know what do I need now what am I going to need in a year so I would just think that through to understand because it's definitely a different Avatar got it thank you for sure let's go right here other than listening to your podcast every day what do you recommend I can do to be a a leader in terms of like like being a leader in my company and then also helping patients in the in the vision of what they can achieve with their health well where do you think you're weakest that like no like leadership is such a like broad term right so it's like what's the one skill within leadership which is compiled of probably 30 40 skills that you're like this is probably you can ask her if you're not if you're not sure well I think like for me this is something so new that now it's like oh [ __ ] I need to become a leader like how do I do that how do I and how how do I get people to feel like they want to work with us or like that they want to do the treatments that I'm offering you know so it's like I'm facing that in both sides of doing right now I think that you're over complicating a little bit I do that a lot yeah the way I look at it in terms of leadership and management every day is game day which means every one-on-one like I literally think to myself in the morning I'm like I need to crush this 101 like I know it sounds insane but I'm like if I want to be a leader then I take these meetings just as seriously as I take a meeting talking about our growth strategy or talking about anything else in the business and so you get to practice every day every time you have an interaction with somebody and so the question is I would say every day in the beginning of your day are you thinking about what am I going to do differently today one thing not three not four not 10 but what's one thing I'm going to do differently today in these interactions than I did yesterday and that adds up a lot and if you focus on one thing at a time your rate of improvement will be much higher than if you focus on 10 you know in the beginning what I used to do for myself is I would have a sticky note that I would put on my computer whatever I was trying to focus on at the time you know in the beginning because I'm very expressive with my face and so someone would say something be like it's like that's not good um so I just had a little sticky note that said be neutral and I probably had that for about two three weeks until I noticed like I was just like a neutral reaction to everything nothing was good or bad I just was like asking questions right and then at one point I felt like I was too passive and so I had a word that said confront and so someone would say something and everyone be like okay and I like actually no I don't agree let's talk about that and so I think you just have to identify like what's the one thing can focus on today and if you keep it top of mind and you put environmental cues around for yourself you're going to get better but don't over complicate and think like you don't need some [ __ ] sorry but like I'm not sorry [ __ ] it uh like you don't need like to read all these leadership books and like everyone spends too much time in their heads you know people always ask me they're like what did you learn who did you nobody nobody I [ __ ] did it I just [ __ ] did it yeah and then I get feedback from my team that's a huge piece too which is like you don't just get feedback from watching yourself do it but you get feedback from the reaction the person has does their behavior change or not if it doesn't change try again so I look at it as like my whole team is a result it's all feedback their behaviors how they act the people I interact with their behaviors are feedback to me of if I'm doing my job right or not so you get that every day so don't feel like you need to go read some book or read like you don't need it like you just have to observe and become incredibly observant of everything around you and say like I said this to this person on Thursday what are they doing on Friday Saturday and Sunday thank you so much for sure let's go right here I run a dental recruiting and consulting firm oh and that's kind of part of the problem is we're doing both and um I'm at the point where we need to commit kind of one way or the other we only take on the Consulting projects to keep the lights on well while we're trying to scale the recruiting projects so you recruit for dental practices yes dude my cousin's a dentist and texted me this morning I'm sorry to bug you but I can't find this one front desk all right all right I need your number I was like bro I don't know yeah so that's what we do we specifically in recruiting we're only doing dentists and hygienists okay and that's it and it's a premium recruiting offer um but like I said we're we're I take on me and my partner take on bigger Consulting projects just to keep keep the lights on okay in a way to justify I guess trying to scale the recruiting part how long have you had the recruiting part we've been doing it for about two and two and a half years and how much profit does it make or how much money is it losing um we're not losing money so specifically on on the recruiting model where is six to one lifetime value to CAC um but it's cash flow tight because it takes a long long time for us to fulfill um those can you tell me your pricing model yeah so for our done for you associate hiring system which is like anyways 35,000 total fee flat fee and then we we collect that over the phase of the project so we just recently changed the investment model as far as we used to ask for 30% up front the remaining 70% at signing um we're testing to see if we can do 3,000 a month plus progress payments for every every qualified candidate we deliver the practice and then the remaining due when the placement is completed understood okay is there any reason you couldn't do 50/50 we haven't tried it that's always 50 50% up front 50% up placement yeah pitch that [ __ ] okay yeah um but okay so you have the Consulting side how much revenues does that generate um so the revenue is kind of split 50-50 we're not huge so we're doing about 650 top and so the few projects that we brought on just my partner and I solely fulfill those um as far as the Consulting and then the rest of the team which is only two three other people yeah um do the recruiting bit okay understood so with the Consulting piece though how much of your time is it taking why is it a problem takes up a lot of time and and I just feel like yeah it it takes us down a path of not being able to focus on the recruiting bit and it feels unscalable compared to the recruiting feels like our systems and all that can be is pretty dialed in um so the question then becomes is it more of a lead sales problem on the recruiting if we just could generate more leads is there I mean do you upsell the recruiting clients into Consulting we've considered it um we do offer like an onboarding system upsell uh for 12 months of ongoing coaching on how on board them how to um make sure it doesn't fall apart and become a disaster kind of a thing I'm just trying to think how these things could benefit each other rather than be separate you know it's the same industry so yeah like I mean I would say that an interesting because you're so niched what would be interesting is if you did offer some sort of coaching upsell for the clients that you're recruiting for and then those two things could feed each other you could continue to know when they need more roles and you could probably build a more cons like scalable Consulting model because you'd have more people in it and so it wouldn't be 10one it'd be like a group model or something it wouldn't be as profitable as doing oneone but it would work with the other business and also not take so much of your time yeah so if you were me which one would you prioritize as far as trying to build out more of the Consulting part or doubling down on the recruiting well I would ask myself what do I want to become which is like where do you want this business to go and that's honestly the hardest question question to ask anybody and it's also the one question that you need answer to make those decisions and only you really know which is like what's the purpose of the business why does it exist do you want to make money off of it do you want to sell it do you want to build something amazing and so that that becomes the filter to strategic decision every time I'm trying to make a strategic decision I think back why does this business exist what's my mission and what's my three-year Vision does this fit into that and sometimes I I'm like oh my gosh it does and here's how these things could all feed each other in a system you know like that's why we have this Workshop you know I was like wow this is how this feeds the portfolio and the portfolio feeds it and it can all be synergistic difficult but synergistic um and so I think that's what you have to ask yourself is like can you create a flywheel right two systems that feed each other and make each other better rather than two separate systems if you can figure that out and it fits within what you want for the business I think that's a win if it doesn't fit within what you want you have to step back and ask yourself like what do I want to do with my time there's no rules it doesn't matter like and here's the thing that's difficult but like you'll win either way you know what I mean like winners will win no matter what path they take one might be harder one might not be but like they will figure it out and they will Forge through the rock but it's just like which way do you want to go okay I would try to figure out how they could feed each other I think they can I think it would just take some engineering yeah okay I really appreciate it thank you yeah absolutely let's go right here so I have a floral event design business in Southern California o we have a lot of uh celebrity athletes influencer clients but I also get approached by some to do events for free for press social media and I've been doing this for 105 years do I yeah I have done it before yeah but I don't want to do it anymore do I do it or not or do I approach the people that already talk you know I just you know I've never understood that yeah this weekend I have an event for whoopy Goldberg oh nice so so they gave me a budget but they're like if you give us more then we'll plug you in some way somehow did they say how no not yet I'm just like I said no in the initially but now since I've been here I thought about it for basically um exposure well why did you say no because I'm tired of doing [ __ ] for free do you need to do it for free to get more business um it's just to have like current press to say this person's my client to kind of bragging rights I suppose do you have clients that are celebrities that pay you yeah but I've never told anyone I've never signed an NDA but I've never told people that oh look who came into the store today or look who we delivering to today I've kept it like confidential because I think we built that relationship and they trust me to come to me for their events or flowers I'd say this which is like you get to decide how you want to do business yeah you know me specifically I could actually ask for people to do stuff for me for free all day I get it offered all time I don't want to because I don't find that I don't want owe somebody something I don't want to have to promote their business like I will pay more to not have to do that because I don't like that D that Dynamic um if you don't feel comfortable doing that it feels icky right just for whatever reason then don't do it [ __ ] it your business will grow and win either way it doesn't need whoopy Goldberg one time and here's the thing that I will say because a lot of the people that I work with also work with celebrities um them saying they're going to endorse it could mean so many different things you get that [ __ ] in writing because listen it's not the celebrity deciding it's their team and their teams often are trying to get [ __ ] cheap trying to get stuff done under budget and so like how are they going to endorse it is what I would want to understand like if I ever did trade it would be in writing and it would say exactly I'm going to do three Instagram stories I'm G to make a post I'm going to tag you and I'm going to do X Y and Z yeah I don't think just because somebody's a celebrity and trust me I know plenty of them that they should get to treat other people differently unless there's a clear exchange not a like if there's a clear exchange where they're like we will do this and look how many people will get sent to you because of these other posts we've done that have sent this much to a business otherwise they're just taking advantage of small businesses yeah thank you yeah sure right I traveled from BR from Czech Republic here so thank you for your uh videos I think you're a great operator and I learned so much from your content so thank you thank you for that uh and your team is great as well so I really enjoy this two days spending with you and see uh what you transfer on others so it really works thank you um coming to the question which was very interesting for me to hear was the ratio 10 till one for reinforcements instead of uh punishment or giving them strong feedback um and now you mention the phas I can relate to that so I'm speaking to my team and coaching them through some situation like communication Etc how to talk to the customer how to solve some problems Etc and I feel sometimes I'm doing it too much so this one was actually um talking to me strongly so how you navigate with that that you don't do it too much is it like you just have once a week one onone and that's it or daily they have some situation so I'm thinking with them let's say in the middle of the day hey where are you at asking few things they answer to me like hey you solve it this way I would solve it this way okay makes sense write it down next time do it differently kind of put it in s so but sometimes they can make feel feel that this is too much but in our culture it's okay like we are there for growth so but compared to 10 to one reinforcement instead of feedback uh yeah I I would say this which is like um delivering somebody like a criticism is different than telling somebody what they could do differently next time um so it's like critiquing and then there's also offering Alternatives um and they're different which is like a critique is like we want you here you're here here the discrepancy it's pointing out the discrepancy in performance but if you're doing it too much isn't it hard for them to take in a way so another thing that you can do is just provide Alternatives so for the most part what I do is I don't critique people so much as I provide them with an alternative oh you did this oh you know what what are you what you should try this this next time here's what I did one time and this worked really well try it let me know what happens that doesn't seem like a critique because I'm not talking about what happened in the past or what their performance is at I'm just giving them something to do next time and so I found that to work really well um because I have a lot more of those I can put on and like people already if they're high performers take that harshly because they're like oh she thinks I could do it differently um and so that's that's the first thing I would say the second thing I would say is that what works for you you know you have to understand like and ask yourself like what works for you as somebody that's over this team how do you want to be systemizing your schedule and all these things to be giving people feedback at some point if there's all this if it's a global problem right when I say like local it's like okay there's one or two people that this is happening with versus global like it's pretty much the whole team maybe it's one to many not one to one um because at some point that has to be the switch because you want to level up the whole team and every time you have a one-on-one interaction you kind of do a disservice to the rest of the team by they don't get that feedback or that Insight that that one person did and so I would also just ask myself in these situations like is it one person is it the whole team is this a pattern or is it a one-off um you know I factor in is somebody new is somebody been here for a while you know what's going on in the environment in terms of giving them feedback I think that the best thing that you can do is rather than you constantly giving them feedback you create a system or an environment where they give themselves feedback so for example you know I do end of week reports where people are turning things in talking about how the week went how they did performance- wise for idual contributor roles usually they're you know saying what did you complete in terms of these things that you have as tasks and so they're giving feedback to me about themselves and then I'm asking them in this set of questions it's basically a rubric they're basically telling me how they think they did and so the easiest thing to do is to create a sort of rubric that people fill out and turn into you you don't need to have a conversation to facilitate that and so I would say that um you know yes we're all about growth but if you get somebody to point it out themselves first and to be self-measuring like if I step on the scale each morning and I want to lose weight the likelihood that I lose weight is high if you tell me how much I weigh every day the likelihood I lose weight is I probably will but I will lose less so if they point it out themselves then they are more likely to take action so you create the environment and the systems in which they can point it out does that make sense yeah it does so actually when I'm thinking about it like I have people who are with me for a few years and I don't have to give them much feedback it's just once a week they take it and I don't have to work on that much yeah but with a new people it takes time let's say six to 12 months still it's on boarding before they and they don't come up with their own ideas in some way so it's still quite a lot so I'm can we also just highlight you said it takes six to 12 months six to 12 months to get somebody like really on board in a business like that's not that was actually a great thing to say I've never heard anyone normalize that so that's 100% true takes a while yeah and so maybe one last about that is it the frequency I understand that they can do weekly report but they don't understand so I can elaborate it or what is too much if I would ask like very simply to give them to giving them this is the gap this is how I would solve it if they do daily reporting because they have daily metrics then you can give daily feedback and the if you give more feedback make it smaller if you give less feedback it would need to be bigger what's more effective is small frequent feedback there's nothing wrong with that it doesn't feel like too much if it's one thing at a time so for example if somebody gives me something like on a quarterly review I don't go through and talk about the six things that someone needs to do differently wow so many Gatorades um I talk about the one thing that's going to move the needle for that person does that not mean that there's like three other things that I would like them to work on no there's definitely three others but I know that this is the one we have to focus on when it starts to feel like too much is when you're overwhelming them they haven't even improved the first skill and you're already telling them here's the next two that you've got to work on and they haven't even fixed that first one okay thank you yeah right here so I'm trying to change the culture a little bit because lately we've been veering more towards negative reinforcement and I want to change it back because we used to be very like positive like very positive but lately it's been you know Shifting the other direction so can you tell me like your top three dos and don'ts of like building a positive culture well I'd ask you this which is why did it shift um hired a new manager and he took what he learned in the last company over to ours and I haven't yet trained them on how to you know talk to and Coach uh the people on okay so the culture shifted because you hired this manager yes how long has he been a manager uh in company here like my company or in general like how long has he been doing that type of work I'm not I don't remember I think it was like three years okay so okay is he old or is he young about my age how old so 32 I don't know okay um okay so he's on the younger side okay that's good to know basically I look at it like this which is like if somebody were to tell me if I were to come to you and' be like hey how do I shift my culture and you were like well well why and I'd be like well I hire this one manager and they made it worse then I would say they didn't do their job um they're doing the opposite of their job and so that's the first thing I would actually start with which is like and this is actually like a really important point which is like one person can really change the culture of a company if they're in a leadership position um because it shows to the rest of the leaders what's acceptable and what's not so it also I would say like demotivates a lot of other leaders on the team because they're thinking to themselves like oh well that's acceptable then like why am I trying so [ __ ] hard and then to everybody else on the team they're like well this is what he thinks a leader is and so I would ask you this which is have you brought that up to him and does he acknowledge that that is how he does things and that it's not productive yeah recently brought it up to him and we're changing the culture now so okay so a little bit late but how many people are on the team 11 I would just ask this how long do you think it's going to take it's not about changing the culture it's about changing him mhm how long is it going to take to change his behavior do you have the skill to change his behavior I believe so okay and if I were to guess maybe three months to fully change it like completely turn it around do you have the time at the moment yes I do okay and the desire clearly yeah [Laughter] fine um most of the time I would say like if you hire somebody and they make the culture worse it's probably not the right person to put in there and here's the one thing I'll say to you which is you can coach him on how he can change it's not about change your culture about changing this one person but if your team does not accept him as a leader that's a completely different problem what I tell people all the time is you can come in here and you can be a leader to Lea but if you're not a leader to your peers and to the rest of the team and they don't see you as a leader I can't help you with that I can train you all day I can do all these things but if you don't know how to work the Team Dynamics then I can't help you because they will push you out not me and that's how teams work is like if they do not if if they don't respect this person as a leader because maybe they have opposite values of you then you can do as much as you want the likelihood that they end up truly letting that person be their leader and submitting to them is low so I would just plant that seed for you so you can keep that in your mind in terms of changing that behavior it's again it's about frequency of feedback and so when it's one person because you really need to change one person to change quote the culture then it's what is the behavior that they're doing and how do we measure it and constantly give them feedback about it and also be incredibly [ __ ] direct about it like I would literally be like I went to this conference and the question that I asked Lea on stage was how do I change the culture and she said oh it's your manager um because I would want that person to understand how important it is um and say like listen I'm having this conversation with you because I believe that you can change if I didn't believe it then I would just replace you but I believe you can here's what we need to do and then I'd formulate a plan with them and that plan would be dictated around like what's the one behavior that they exhibit that is causing the most issues right so I'll give you an example I had I've had successful Behavior change and I've had non-successful so I had one person who was non-successful um who that person she would get very angry with people out of nowhere so basically someone would say something it would provoke anxiety in her because it would be like oh that's a lot of work for me or oh that's a lot of change or oh whatever freak her out right and then she would like yell at them like straight up and like be a complete freaking meany head and it was the complete opposite I wanted to say something else uh of our culture and I was like what the hell so you know I pulled her to the side and I was like dude this is [ __ ] up like this is the opposite of everything we teach what we preach my content like what's going on and she was like I know I don't know how to change it completely knew that was going on and said yes I want to change it that's why I work here that's why I want to work for you and I was like gosh I I didn't know that you even knew of this and I hadn't even seen it until now and so basically what we did is that we had a Cadence where we met multiple times a week to talk about like how have you done basically had her color code her calls according to like green meant like you did great you didn't snap at anybody and red meant like you snapped at somebody um and what I saw happen was that actually her behavior got worse not better right and so sometimes that happens because people are so ingrained in their behavior that then they get anxious about the fact that they know that you know and it starts happening more that's happened before now I also had it where it's been successful and that has been different in different cases um in one case I had a guy that he would get really mopy on calls Whenever there was something that didn't go his way and so I brought it to his attention and was like did you know that every time like you clearly don't agree with something like you kind of mope on these calls and it's like really not great for the culture especially because you're a leader and he was like oh my gosh I had no idea and like that was all it took to change it around and turn it around and I was just completely upfront honest I didn't sugarcoat anything right there's some people who what you have to do is you have to constantly reinforce it for a week or two weeks here's what I'd say you address it you give him feedback daily um on if you see it or don't see it so you praise him when he does something right and if he doesn't do something well you have to critique him and what you want to say see is if he greatly improves quickly then that is a good leading indicator if he does not improve quickly that's not the kind of person that I would want on my team because that means he's probably not intrinsically motivated to make the change gotcha so would I get feedback from the team to see if he's changed or would I be watching that well I guess it's both right yeah both I think he's gonna be gone six months okay next question awesome thank you back here in the and Lea this will be your last question okay you're even more glamorous in person by the way uh my my question is um my girlfriend is very smart and she's a developer in my company and I was wondering how you and Alex give each other feedback now and how has that changed over the years from running different size of companies so do you mean like how do we give each other feedback yeah yeah how do you approach uh giving each other constructive criticism feedback without it bleeding into other aspects of your relationship we can disagree without arguing so we often disagree on things or like I might give him feedback or he might give me feedback we might disagree with it go back and forth whatever but then we can come to a conclusion and we're doing this without yelling without fighting without taking it personally and that's the difference between arguing I think arguing is when you're escalating you're bringing emotions into it versus like just simply disagreeing um and so because we're not afraid of disagreeing we can easily bring Fe feedback to each other right and say like hey here's my feedback and here's the data to support it and that's I think what we've both done really well is just we support any kind of feedback that we give each other with data which is just like here's the data and usually the feedback that we give to each other is more of like if either one of us are trying to make a decision that's more under either one of our wheelhouses and the other one disagrees with it then usually the question I ask is like well what information do you have that I don't have right and then it's like okay well share the information because most of the time if we're operating on the same values and we have the same Mission we both want to get there then if we're making different decisions maybe we have different data points that we're using and so a lot of times that's what we have found to be like the Lynch pin in like our feedback is like if it's not based in data then it's not going to be as well received and it's not going to be as useful and so I always start with data which is like what's the data I have to share for him to be able to make this decision with the most context possible um and he does the same for me um and I think that something that we've gotten really good at is just like constantly anchoring to the goal which is like I love you we want the same things we both want to win we don't agree here maybe we have the wrong data so I think we do a great job of framing conversations which is like before we like disagree about something let's remember we're on the same team and I think that in the beginning of our relationship and partnership it didn't feel that way CU we hadn't been on the same team before that right we'd been on different teams and so now it's second nature which is like I just know that we're both here for the greater good of each other I don't have to say it as much but for a couple years there like every conversation needed to start with what we called qualifiers which is essentially framing the conversation anchoring it to the goal and reminding each other of the fact that we both want the same things and sometimes that is like the one thing that you need to be able to receive some of the feedback and I think um especially for when I've I've observed a lot of couples in business together male female relationship um a lot of men tend to give less context to women and a lot of women tend to use emotions as explanations and so my advice usually is to men give more context to your feedback give overe explain because usually that's just explain and then for women is lead with data not emotion because a lot of times they might find oh it was just an emotion there's actually no supporting data or they might say oh my gosh my emotions are supported by data and now I have words to put to what I'm feeling and so I hope that's helpful yeah it was thank you I appreciate that for sure let's do one more oh well that was very enthusiastic we're kind of struggling with our LTV to coak ratio mostly because we we are at e-commerce d2c Beauty and our products are onetime purchases uh with what is it h our main product is IPL removal device we have LD devices like face mask on yeah I've seen those recently and I was like those exist okay yeah and there's good um so my question is how much uh should we focus on like maybe launching new products so we can increase our LTV to C ratio because our ER recuring revenue is pretty low like 7even six % maybe yeah how much should we focus on increasing this recurring Revenue versus just like a scaling selling our bestseller products you know because we have the confidence we can scale we're at 2 million in Revenue a year we can make maybe like five six in one and a half years two years so how much should we focus on increasing the revenue retention versus just selling more of what we can sell well how hard is it to continue selling more of what you're currently selling well we think not much we think we can do it right because in your business typically that is pretty straightforward so is there a way that you guys could sort of divide and conquer this so that one of you focuses on keeping the wheels on the bus keep doing what we're doing while the other one of you goes and tries to figure out how we could expand LTV well I think we could but yeah I think we could because a lot of times for example like for me and Alex we divide and conquer all the time which is like all right you go here I go here break like we do not focus on the same thing together that would be a waste of both of our times that goes for a lot of Partnerships you have to really trust your business partner because if you're doing you guys are business partners yeah okay God I was just like I just assumed um uh that would have been so [ __ ] awkward um a lot of times people overlap a lot and so it limits bandwidth um and so if I were you guys in this situation I'd be like cool I'm going to scale as best as I can front end and then you go work on back end and I would try and do that now I do think this which is like in order to have a sustainable business figuring out the LTV and how to have recurring revenue is crucial um because eventually when you can't get more customers because whatever The Fad goes away you know there's a new thing that comes out whatever it is like that's not like a business that's like an opportunity so you want to turn this opportunity into more of a recurring business with probably additional products and things they can buy on the back end yeah do you think it is sustain able to increase these length of value just by continuously launching new products that do not necessarily complement each other I would say the first step is to do that and the next step after that is to create a brand like consumables like something like a brand is in like a brand that consumers trust rather than just like launching product launching like what's the North Star are we creating a brand because you look at like d Toc why do people buy like brand you know I mean it's really hard to differentiate on price or on the thing you're selling itself unless you get in at the right time then you're like holy [ __ ] ride this wave but at some point it's going to come crashing down and then it's like what are you left with if you haven't built a brand and so I think that the the smart thing to do is that if you're in the Market at the right time which it sounds like obviously I just saw this for the first time it seems like it's something new like you have the ability to create a brand based on like if you can continue scaling and building the back end that's the next few things you have to do but after that how do you get people to want to buy before they even see the product that you have how do you get people to want to buy the next product before they even know what it is brand and so that's the only way I think that you will continue to compete in that market is if you focus on building a brand I would not buy from somebody that I saw on a random whatever right I'll buy from Brand though and I don't even care what they have I'll buy everything they have because I like the brand and so I think it's continue to scale the front end work on the lifetime value recurring yes because you need that with a brand itself and then it's like how do we what is this brand that we're building thanks absolutely all right guys I think sami's GNA come wrap it up for everybody I appreciate the leftovers they were not too bad today thank you guys