This first hire nearly bankrupt me…but was worth it..

Summary

• I often get asked when to hire and who to hire when scaling your business.
• As a business owner starting out, it's normal not to know exactly what you're doing.
• To figure out who to hire next, consider the greatest percentage of your time spent and which activities are at the lowest cost.
• Assign a value to each task based on either market value or which is making you the most money.
• Do not outsource crucial business tasks early on; focus on roles like admin and billing that have less impact when outsourced.
• The objective of hiring is to give you more time.
• The process of entrepreneurship is about buying back time and increasing your skill level.
• Eventually, your role will be to make decisions and provide a vision for others to align with.
• Your first few hires will likely be administrative help or a jack of all trades who believes in your vision.
• Another early hire might be someone who helps with customer fulfillment if you've productized your service.
• When starting out, expect to work overtime, working on the business and building a foundation for others.
• As you scale, move up the value ladder, spending time on high-revenue, low-time-consuming tasks.
• Always consider what tasks take the most time that can be outsourced for the least cost when planning your hires.
• Remember, you're not alone in this journey, and hiring right is a key step to scaling your business efficiently.

Video

How To Take Action

A good way of figuring out who to hire next is to look at where you're spending a lot of time. Tasks that take most of your time should be looked at first. If these tasks are easy and cheap to give to someone else, start there. This way, you get more time to work on things that make more money.

When you hire, think about the time you get back. Go for the roles that don't hurt your business a lot if they go wrong. So, things like admin work or billing are good places to start.

You need to make sure your business can run without you doing everything. Teach others to do tasks so you can work on growing the business. If your service can be done the same way each time, hire someone to help with that part.

Your first hires might be someone who can do lots of different tasks or who believes in your vision. These people often work really hard for you.

As your business gets bigger, try to do jobs that make money without taking lots of time. This means you'll move up to doing the big stuff like making tough choices and showing the way forward.

Always remember, hiring the right way is important to make your business grow the right way. You're not alone, and lots of people have done this before. Just follow the right steps, and you'll get there too.

Quotes by Alex Hormozi

"the objective of the hire should be to give you time"

– Alex Hormozi

"the process of entrepreneurship is just buying back time and increasing your level of skill"

– Alex Hormozi

"having a vision that everyone is aligned with"

– Alex Hormozi

"the first things you need to do is figure out how you can reliably replicate the same outcome among customers"

– Alex Hormozi

"it is productizing the service"

– Alex Hormozi

Full Transcript

to hire first when you are scaling your business number one question i get all the time is when should i hire who do i hire at what point do i know it's right and the first secret to this is that you're never going to know by the way my name is alex ramozzi on acquisition.com we're going to portfolio companies of 85 million a year so let's rock and roll so one of the biggest issues is when you're starting as a business owner is that you don't know what the hell you're doing right and that's okay but what i want to introduce you is a simple concept that i use when thinking through this as a simple tool that you can use when you think about your stack of time all right so let's say that this is all of the time that you have in your day let's say you spend a certain amount of time doing uh you know admin work and then you do some sales and you do some marketing and you do some uh you know let's say billing and then you do some uh you know customer facing stuff the way that you determine which of these things you hire next is you look at two factors number one is what is the greatest percentage of your time like where is the greatest percentage of your time that you are spending number two is what is the cost that's the lowest cost activity that is the highest percentage of time and so what you want to look at here is a scribe of value to each of these types of things now you can look at market value or what i prefer to do is which of these things is making me the most money all right so right now there will probably be activities in your business that make you money but they don't make you as much money as let's say sales does and so we're not going to outsource something that's crucial to the business at this early stage when we have something let's say admin and billing that we can outsource earlier on that have a lower likelihood of impacting your business in a negative way all right so we're really trying to play defense here when we're looking at how we're going to hire and the objective and this is the main thing here because understanding what problem we are solving is one of the most important aspects of entrepreneurship is picking the problem that we're truly solving most people start solving problems that don't even exist we're solving problems that not aren't even problems in their business they're not even constraints that exist and so the objective of the hire should be to give you time it should be to give you time back and so the idea is how can i get the most time back for the least amount of money and that's consistently the process that you'll continue to do in your entrepreneurial journey is how do i get more time back over and over and over again and independent what everyone says the process of entrepreneurship is just buying back time and increasing your level of skill so that you can do higher and higher revenue activities to the point where the only thing and i'll tell you where the final place that you'll have is that you'll just be making decisions right this is the highest level and then beyond that it's having a vision that everyone is aligned with that they're making their decisions through you provide the lens through which people underneath of you make decisions in alignment so that they can move the entire organization forward on your behalf now when you're starting out most times most times what you will need to end up doing your first one of your first few hires will be one of these two things a it will be some sort of administrative help or some sort of first follower who will help you who believes in you believes in your vision and like this is why spouses a lot of times end up being that first hire right that girlfriend or whatever who ends up believing in you and you know quitting their job so that they can you know support you and you guys go do this thing together right and that's because they're going to be they're going to be more invested you get way more work out of that person than you would out of a normal employee but you can also find those types of people and that is very common as the first type of hire is kind of a a jack of all trades admin help person all right the other type of hire that i see so usually one of these two is the first hire is somebody who can assist with the fulfillment so if you have productized your service which is going to be one of the first things you need to do is figure out how you can rep reliably replicate the same outcome among customers which is why it's important to narrow down the type of customer you're servicing and the type of outcome you're delivering so that you can make it easier for someone else to accomplish the same thing as you so that you can focus on running the business and not actually doing the thing you are selling it is productizing the service and so that means that in the beginning you'll need to always work overtime because you're basically working one and a half or double so you're working on doing the business things while also building the infrastructure foundation so that other people can work within this model most people who are starting out i'll write this down for you so that you can have a visual for it number one is usually either an admin slash helper for you or company somebody to help with customer fulfillment those are typically one of the first two hires you will have and this is obviously with a broad generalization based on a founder-owned bootstrap business that doesn't have funding which 99 of businesses fall in that category all right now if you're a three-founder you know vc-backed startup then obviously you might have different hiring schema right off the bat but if you're starting this from your from ground zero and this is you and you are hustling these are usually going to be the first two uh highers you have because these are usually the things that take you the most amount of time that provide the least amount of value all right so that you continue to work your way up this uh this this this value ladder which i can probably do at another time as you go up this this ladder they should be the things that take you uh that bring the most amount of money and the least amount of time so this is a little time hourglass which i failed miserably at but the most amount of money least amount of time that is what you are you're spending your time doing and you outsource these things in this order and that is the thought process that i use when i'm trying to figure out what things and what people i need to hire next which is what's taking me the most amount of time that i can buy from the marketplace the least amount of money emozy nation make these videos a lot of people broke and i would should be one of them i want you to scale the crap out of your business and i'd love to know that this video helped you so anyways lots of love keep being awesome i'll see you guys in the next vid bye