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There are multiple benefits in outsourcing your company’s services overseas and the Philippines is one of the best countries to do it. Full Scale makes the most of this by employing the greater bulk of their workforce from Cebu City, the country’s second-largest city. Despite the challenges associated with working in another culture and another time zone, the company has been able to achieve rapid revenue growth in the past few years. A lot of this is thanks to its COO, Darrell Blackburn, who has spent the last decade honing skills relevant to increasing financial stability and operational efficiency in a number of different industries. Joining Cameron Herold for a chat, Darrell takes us through the process of doing business in the Philippines and how COVID-19 has affected operations there. He also talks about the company’s culture and how they are cultivating loyalty among their staff.
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Over the past couple of years, Darrell has spent his professional energy honing skills relevant to increasing financial stability and operational efficiency in a number of industries. From startups to Fortune 500 companies, Darrell brings a wide variety of knowledge about the positive and negative of each side of the spectrum. His experience includes helping to pilot a new clinical technology capable of a top ten pharmaceutical company. While there, Darrell has helped increase the adoption rate of the program from approximately 25% of phase 2 and phase 3 trials to over 75% in three years.
Darrell has helped his company Full Scale achieve rapid growth of over 80% from 2018 to 2019 including seventeen straight months of revenue growth. He played an integral part in creating rapid employee growth over 190 employees worldwide while implementing and maintaining a culture needed to succeed. As Full Scale approaches another anniversary, Darrell continues to push the employees and company towards efficiency and productivity. Darrell, welcome to the show.
It’s great to be here, Cameron.
Before we dive in, tell us exactly what Full Scale is and what you guys are focusing on as a company now.
Full Scale employs about 185 developers, QA, and project managers in Cebu City, Philippines, which is the second-largest city in the Philippines. There are about three million population and one of their big expertise exports is technology and software development. They have a great school system and put a lot of emphasis on their education in those sectors. We hook them up with mainly US clients that need software development help. Where we differ from a lot of normal dev shops, the standard is you do a project bid, you do a project and you go on about your way. We’re more of a staff augmentation company where those are full-time resources built out on a fixed monthly rate, and they’re yours to manage however you want. We removed some of the layers of management that put you directly with the talent that you need to find which is hard to find and let you go from there. We try to make it as easy as possible.
It’s like a full outsourced IT shop then?
Pretty much. I would say complementary is the best way to put it because one of the things that we’ve learned as we’ve grown and gotten into something that we didn’t plan on getting in as this stuff usually goes is that the complementary works well for our client. Often our best clients aren’t people that fully offshore their development and that’s not what we’re always looking to do. If they have a current IT department, they run things well and have a current development staff, we work well as a partner with that. You can bring down your average cost of developers and mix them in with a blended team that one, improves efficiency because you’re now working on a twelve-hour time difference. You have around the clock productivity as well as you can get that dollar-cost average of your software development team down.
What’s the cost difference between outsourcing through a group like you to maybe hiring based in an average city USA.
It depends on the average city USA in what we’re calling an average city. The coasts are extremely expensive and if you’re going to hire locally and fully employ the developer, it’s essentially difficult for our clientele to compete. On the coasts, you’ve got Apple and Google. They swallow up talent so fast. The studies are hard to tell because some people give up posting eventually but last we saw there were about 375,000 open jobs in the software development field. That’s 375,000 jobs that can’t even be filled because there’s not enough talent.
We didn’t do a good enough job. I know we’ve got STEM going now but it is such a long-term program to put the education focus on those areas. We’re lagging behind. There’s a ton of jobs that are open. People have given up and stopped working so the job postings have slowed from that standpoint. If you do sign someone by the time you hire them, train them, and they’re worthwhile at what they’re doing, they’re eligible for a better job on a coast that pays way more. We do a lot with the middle of the country and smaller and midsize businesses that can’t compete with the bigger companies that can throw the money around.
To fully answer your question, if you’re going to hire someone, the price is a fifth of what it could cost to fully hire someone locally that’s a senior dev. If you’re going to go to a project shop, it all depends on the project. It is rapidly different based on the skillset, the type of platform or product that you’re trying to build it. It can vary all over the place. That’s one thing that a lot of people don’t like about the product. With any product, you don’t fully know what you’re getting into. You scope it out well as you can, but as you start to build, you build and the product owner has a change in direction, there’s a pivot. Ultimately, it’s not going to be done on the original timeline and under the budget as often as we would like it to be.
That’s where we have a flat monthly billing that says, “This is your resource. Use them however you like. Pivot if you want. Do whatever you want with them.†We have some management in place to make sure that fail-safes are in place and we’re getting the proper communication back and forth with the client. From that standpoint, it’s difficult based on the project. Every expertise is going to have a different cost to it. Generally, we’re easily 3 to 4 times less expensive and we handle all the stuff that nobody wants to handle with the recruiting and the assessing of the developers.
Is your restrainer for growth than actual talent, the people over in the Philippines to do the work?
It is and it’s funny because we talked about this. The COVID-19 is rapidly changing the landscape of this. One of the other things that’s interesting dealing with a little bit more of an underdeveloped country is office space. That was one of our big restrictions. The way the international office space works is capital intensive. It takes a lot of cash to get a big office worthwhile up and going. It’s also given to you in a warm shell where you have to fully construct the office so there’s more capital required to complete the construction. Our biggest growth restrainers were physical talent to match up with clients and the ability to house those employees. However, that’s rapidly changing in the environment.
Do any of your employees work from home then as well? Are most of them working from physical space? Are you adapting to that then as well?
Pre COVID-19, we had a physical space. That was part of the cultural commitment that we had. It was to get a lot of young, bright minds and experts in the same room with each other interacting. That conversation is invaluable a little bit. That’s what we worked hard to make sure we don’t lose as we go towards a more remote workspace. That’s one of the things we’re putting a lot of emphasis on so we don’t lose that transfer of knowledge and that interaction about, “I’m stuck on this problem. Do you have any ideas?†It’s like being able to walk across the hallway. That’s pretty invaluable.
We’re moving towards a more remote workforce. The one thing that we have going for us and in that regard is that we work with a number of different clients. We don’t typically operate on a daily basis, getting into the daily operations to know what they’re doing daily. They’re a little bit independent in that regard. They have their small client teams and it’s trying to continue to push the team meetings to make sure that that communication is flowing for the project. So far, we’ve seen great success with a remote workforce which is interesting for our future growth.
Are you looking outside? I spent some time over in the Philippines years ago and liked it. I love the culture. The people were amazing, completely loyal, and love working with North American companies as well. English is their first language over there for the most part. They go to school in English and you don’t often hear accents with a lot of them. Are you looking outside of the Philippines at all? Are you looking into any countries like Bulgaria or anything in Eastern Europe?
We had originally explored Belarus. We went the Eastern European route. A couple of the challenges that we found, we ultimately decided not to open up the shop there. You reference some good points about why we love the Philippines. One, there’s enough people there to support it. Cebu City’s three million people that haven’t even touched Manila and the other areas that are up and coming around Manila. There’s more than enough talent to sustain our growth pattern for quite a few years.
Belarus was interesting, we had some trusted employees that had worked on some projects with one of our CEOs and cofounder for a while. We had a little bit of a trust circle there. We spent some time over there, got some buildings up and going. We decided we were going to open the office and did a complete feasibility study. It all matched and their market took a massive shift in a hurry to where their developers became quite a bit pricier.
It removed the value that we could bring from that sample. We would have to contract them out at such a high rate that you’re starting to get into US pricing. Eastern Europe is blowing up in that regard so we looked at that and decided it wasn’t the best option for our growth that we could sustain the growth where we were a little bit better now and it was what we know so we played to our strengths and our growth pattern.
How many employees have you got in North America?
Full Scale COO: The loyalty of Filipino employees is unbelievable if you treat them well.
Six.
You’re a pretty light scrappy team and it’s these 185 freelancers. Do you manage the freelancers as well or are they managed by your clients?
From an HR and admin standpoint and trying to improve their soft skills, their development skills, we do a lot of management there. We have a full management staff on the ground in Cebu City for that purpose to help with all of the employment issues. We’ve fully employed all 185 people in Cebu. We directly employ them and we have that management there to help with any employment issues. Our HMO plans, typical daily operational items, as well as trying to increase their soft skills or their critical thinking, advanced their development skills, and offer some training in that regard. Our management staff has a hands-on approach when it comes to those employees. As far as their daily directional work, that comes directly from the client.
What’s your turnover rate with that staff? Is it too early to tell what your turnover is? Do you know what the lifespan of the tech people is going to be?
Our churn rate is low now. Officially, the company was incorporated in the Philippines in July of 2018 and we’re at about 87% retention rate. The ones that have turned is a lack of culture fit generally or an inability to speak conversational English. There’s a difference between being able to speak English and having the critical thinking abilities that go along with fully knowing and understanding the English language. That’s been our biggest challenge with assessing. We put a lot of onus from our side on properly assessing the employees as they come in the door to make sure they’re a culture fit and that they have the skills from more so a soft skill standpoint that they will succeed with our clients.
Every now and then we have a system break. Someone gets through the cracks and it’s on us to keep improving and getting better with that and we have. So far, our retention has been great with our employees. We do a lot to focus on that. We pay around 20% more than the market average over there. We offer massages in the office, catered meals, drinks, and snacks. We’ve tried to bring more of an American culture over there to their typical outsourcing culture, which isn’t always so great. We provide top equipment and everything we can do we can do to foster an environment of growth and success.
Some of that’s starting to become pretty normal over there now as well. From my understanding, a lot of the companies that are doing business over in the Philippines have brought a lot of that culture over there that it’s starting to eke in. I remember I had a client in the Philippines years ago and I told him to buy all of his employees Herman Miller, Aeron chairs. He looked at me and he’s like, “I’m doing it.†He brought in these amazing chairs, and it blew everybody’s minds. He’s like, “If I take care of my people, they’re never going to leave.â€
That’s what you mentioned when you were speaking about your experience with the Philippines. The loyalty is unbelievable. All that they’re looking forward to being treated well there. There has been a previously bad culture and as you noted, it’s getting better but in the past, it was call center mentality where you’re going to be in a small cubicle. You don’t matter. You’re replaceable. We’ll move on to the next one. That’s changing and I’m proud to say that we’re a part of helping that change, but the loyalty is unbelievable if you treat them well which is great.
I don’t remember if it’s the president or prime minister over there, but there was some political instability there in 2019. How is that?
I would say it’s probably pretty ongoing. They do have a controversial president and it doesn’t affect us as much because we’re on a different island. We are in Cebu City so we don’t get as much of the fallout from Manila where their president’s located and where the capital is. We haven’t seen a lot from that until the pandemic. There’s a lot of government mandates around the quarantines with COVID-19. I got a picture of tanks rolling through the streets near our offices. It’s a little bit of a different mentality in the way they enforce their laws. Otherwise, we haven’t had a lot of impact on it. They’re pretty good with businesses over there.
I spoke to the Young Presidents Organization, the YPO, and the EO Chapter over there. That was why I was there and one of the members mentioned that taxes are negotiable. Are you a Philippines based company or are you a US-based company or both?
The technical structure of our company is that we are both. We have a US LLC, that technically has a service agreement with a Filipino Corporation that’s owned by the same people on both sides so we can control the way that the service prices work on both sides so we can control our vendor costs. Technically, we are two separate entities.
How do you deal with the taxation issue over there? Is that negotiable? Do you know what I’m talking about? What I was explained to was it’s almost a series of systematic bribes that are above board and that’s the way things are done? The Filipino CEO turned to me goes, “In America, you call it lobbying. Here, we call it bribery.â€
That’s a good way to put it. It’s getting a little bit more stable from what we can expect on the taxes. It’s pretty leveled out now that we pretty much know what’s going to happen, but there is still that element to their government. We run across that on certain things or certain forms that have to get through or they have different economic groups such as PEZA, which is the group that you go to avoid VAT and some different exclusions with that. There are still some things where they want their cut of certain items to file certain forms or to be part of certain inclusionary groups. It’s not too big of a part of our daily operations to worry about that, though.
Do you still have to play along with those lines or do you try to go, “No, we don’t do it that way?†How do you deal with that?
Our typical stance is we try to get along. It’s difficult with us being halfway around the world that if something were to affect our daily operations to quickly rectify it. It’s not always the easiest to jump on a plane, and you’ve got 35 to 40 hours of travel. With that being known, it’s a strategy to get along.
It seems to be the way it has to happen. You can’t enforce our way of business in a different culture. You have to understand their culture and try to work within it as best as possible.
That’s been one of the biggest challenges that I alluded to. This was created by an accident. We have two cofounders. One of our cofounders runs another pretty successful software company and he was having trouble finding and locating talent locally. My other cofounder, who I’ve worked with on and off for a couple of years now and is our current CEO, has had a long history of employing Filipino developers for different software projects. It all was a perfect storm of paths crossing and needs being met at the right time. They’re both named Matt to make it even more confusing.
Matt needed more local development help to realize that the other Matt had an access to a pipeline in the Philippines and wanted access to that. When word spread around town and they’re both pretty well known in this industry in this area. A lot of other people were lining up asking if they could get some help, too. It’s one of those things in business. You often listen for an echo and you know that’s where you need to focus your attention. They quickly figured out there was a large echo, and that’s how we were born.
I was speaking to a CEO in India and he said, “North Americans are so crazy. You try to invent products and spend all your time marketing into people who haven’t even realized they have a need. In India, we find out what the need is and we sell it because we got 1 billion to 3 billion people that need stuff. We sell them the stuff they need.†It sounds like that’s what you did as well. You listen to that echo and you’re selling into it.
It’s great and it is great advice, too. There’s no one that can tell you where to go more than the people that are telling you what they need.
My dad always said that the answer is, “Yes, what are you buying? Yes, I sell it.â€Â Why did you join Full Scale? What was it that attracted you to the organization?
Full Scale COO: Whatever your core competency is, you want to do it better, faster, or cheaper than your competition.
As you mentioned in the ever-generous introduction, my previous role was in a top ten pharmaceutical company. I absolutely loved it. I had an ability to get some structure, learn how large companies operate, which also made me resent how large companies operate. It was a chance to fully impart my ideas, see them immediately put into effect, and feel that sense of winning and change over an organization to see where my imprint was on it. That was the whole catalyst for making the switch. It was a new opportunity. I was burnt out about having my ideas go through fifteen levels of management, only to have the management turnover and we have to start again. It killed my whole creative spirit from that standpoint. The opportunity to make my own rules and see them immediately put into effect was appealing to me.
You’re not the first person I’ve seen go through that either. It’s frustrating for me watching people that are so smart, technically, operationally, and even are entrepreneurial, they don’t even necessarily recognize it works within these big corporate hierarchies and bureaucracies. They feel like drones at the end of the day. I’ve never had to work in one. I was in one for about six months when one of the companies I was president of was acquired, and all of a sudden, I was inside of a 900-person company. I can’t even imagine being a 9,000 or 90,000-person company, but it’s interesting to see them almost die on the vine like that. What was the transition for you? Where did you stumble coming from the big pharma into the entrepreneurial organizations? What did you have to relearn or do differently?
The stumble was the exact same thing that was the catalyst for leaving. It was freedom. You have to narrow your scope and be laser-focused on what you want to attack. I’ve listened to the podcast, and I hear a recurring theme there. Everyone wants to take on too much. I’m guilty of that, too. Having the freedom to take it on though and no one’s telling you no is also the biggest challenge that I had. I had the freedom to do whatever I wanted. I wanted to do it all and there’s not enough time in the day to do it all and do it all well. It’s getting your priorities straight, figuring out what you can, what you can’t delegate, where that makes the biggest impact on the organization, and where I can make my biggest impact on a daily basis to make sure that my priorities are focused properly.
Specifically, walk us through how you prioritize things? How do you decide what to work on what not to? What to do now and what to delay?
The typical rule that I follow is you want to do everything better. You want to do 1 or 3 things. Whatever your core competency is, you want to do it better, faster, or cheaper than your competition. I look at ways that I can have an impact on my organization that other people in our organization cannot. I know I’m the only one capable of that specific item. I also try to be conscious of, “Can I pay somebody within our organization or someone that we’re already paying to do this for me and it’d be more cost-effective?â€
It may take them twice as long but if they’re making a third of what my time costs, it is now more cost-effective for them to have that delegated role. I tried to do an ROI cost analysis on the different items that we have at play and also some things I know that they have to come through eventually so I can break them down and delegate parts of it. Can you get me to a rough draft? I’ll put my final touches on it and move forward. It’s doing a complete analysis from a cost standpoint and an efficiency standpoint of where my time is best spent.
I love that whole looking at an effective hourly rate. I was talking to a CEO that I coached and I said, “It needs to get done, but not by you.†There’s that opportunity to delegate everything except genius. What do you focus on day-to-day now?
My biggest day-to-day now is a little bit different. We’ve alluded to the COVID-19 items that are going on now. A lot of my day-to-day operational issues deal with the ECQ, which is the extended quarantine in the Philippines, as well as the quarantine in the United States. Everybody was, for the most part, pretty affected by the initial blow of the quarantine so it’s figuring out a way to keep operations moving. Make sure we have enough cash to see where we can get in the future and also running a number of different forecasts to say what happens if our revenue halves or if it drops by 75%? What if we go down to zero, how long can we currently sustain our operations?
A lot of planning from that regard, as well as making sure that we have 185 people on the other side of the world that are safe and have the items that they need to properly do their job. The biggest difficulty there is they have literally closed borders so it’d be like if you’re in the United States, and you can’t cross the state line to a different state and we work in all different states. There’s a ton of different borders that we can’t cross where we need to get equipment to different people, different certifications filed with the government to make sure that we’re classified as essential.
That has eaten up a ton of my time. I would say outside of the special circumstances, a lot of the things that I’m focusing on is putting us in front of the proper venture capitalists or lenders to make sure that we can facilitate the growth that we would like to in the future. It’s also making sure that we have a strong company culture. That’s a little bit difficult when you are in exactly different time zones. Their AM is our PM. It’s completely flipped to 12 to 13 hours. Making sure that our voice isn’t lost through different Zoom communication tools, or Slack communication tools, and making sure that our voice is truly heard.
I know you’ve talked about this in the past. One of the ways that we do a lot of that is your video updates. It’s a good way to make sure that our messages are not lost. That video helps us communicate that and make sure that that culture is strong. Ultimately, any organization to create a culture of winning your employees needs to be invested in whether they’re winning or losing on a daily basis. There’s a lot that we do around that making sure that they feel they’re winning on both a personal career development standpoint and winning for their client.
I was thinking about a VA that I had years ago. She was based in Cebu and she sent me a happy birthday video of her playing guitar and singing to me. It was cute. We’re in the midst of US selectively, state by state starting to open things up a little bit. What has happened in COVID-19 in the Philippines? You mentioned that the states are locking up where you can’t transport across state lines within the Philippines. Is that where lobbying comes in to help out or is it pretty firmly locked down? What else has happened that maybe they’re doing differently, better over there, or that you have to juggle around?
As far as what they’re doing differently or better, they have the ability to completely shut down everything. No one is allowed out of their home. If you’re going to the grocery store, based on your license plate, whether you’re an otter even depends on the day, you’re allowed to be out of your house to go to the grocery store. They have a little bit more of an ability to fully control the movement and the freedom of the people so it makes it a little bit easier in that standpoint for them to do an actual lockdown. However, that being said, the one thing that they realize is that American dollars are extremely important to their economy.
It is what it is. It’s an important piece of revenue coming in for them. It’s important so we’re allowed to be deemed essential from that standpoint. All BPOs that deal with American companies can work around that. You mentioned the lobbying, they know what’s important to make sure that they don’t fully shut down. We have some ability to get around that. It’s difficult remotely trying to get the proper paperwork in place and in the hands of whoever may need it that particular day.
It’s super interesting that they’re allowing the US dollar companies in the back-office processing companies to operate over there. It makes sense that they’re trying to keep the economy going as best as possible and control it. You mentioned delegating. How do you delegate? Do you have a process or a way that you delegate or a methodology to make sure that what you delegate gets done properly?
I’m a big fan of one-on-one meetings and as you’ve alluded to the notion that meetings are no good, is an old school notion or it’s looking at not having an understanding of truly what a meeting should accomplish. I have a lot of working meetings where at the end we better have action items, notes, we better break with a clear understanding of who is doing what, why, and when it needs to be communicated. We typically do a quick stand-up scrum, where everyone goes around and says, “Here’s what I did yesterday. Here’s what I’m doing today. Here are any roadblocks that I might have.†That’s how we handle our team communication and I’m a big fan of working one-on-one meetings with anyone that has items that I have delegated that I need to be updated on.
We have to be clear about where in the process I need to be updated or where I might need to insert myself. It’s a lot of communication. Communication is key to everything you do. Without communication, you’re not going to get too far. Anything that I have to delegate, it’s something that I know I either don’t have the time for it and someone else has a skillset to at least get it started or possibly complete it. From that standpoint, we’ll set the proper communication path about how we make sure we get to our end goal.
You’re handling quite well. The one thing that has always driven me crazy about meetings and it’s the reason I wrote the book Meetings Suck, was people kept complaining about meetings without realizing most people have never been trained on how to run meetings. Almost no one has ever been trained on how to attend, participate in them, and work within a meeting. I wrote the book so 30% of it is teaching people how to run meetings, 30% is teaching them how to show up and participate as an attendee, and 30% all the meetings to run your company. You’re right, we can’t get away from meetings. We need them to run highly functional companies and to run high growth companies. We have to run them better. You mentioned one-on-one meetings. I’m a huge fan of one-on-one meetings. How do you structure your one-on-ones with one of your direct reports? Can you walk us through how that agenda might look?
It’ll typically be a 30-minute meeting where I asked what I can do to help them do their job better. I like it to be an open conversation and that is literally the structure of it. We kick off saying, “What can I help you do to make sure that you’re doing your job as well as you can and effectively as you can? What do you need from me?†I always want to be an empathetic voice. If you’ve got a lot on your table, I need communication. What can we do to get that off your plate and on someone else’s? Where are you struggling? What’s holding you down? There are times where we’ve been in a funk and I’ve literally walked into a meeting and said, “Tell me what you hate about your job right now and how can we fix that?†It’s not the worst thing in the world or the end of the world for you to walk in and be like, “I hate this part of my job right now but what can we do to actively fix it?â€
What you’re pointing out is what I always call the flipped upside-down org chart where the role of the leader is to support their team in a three-way direction to make sure they’re working on the stuff. The skill development, as you’re pointing out, and the emotional support, which is sometimes removing obstacles and being there to lend an ear and cheering them on at times too. You’ve got that part. You’re dialing in nicely. What are you guys looking at in terms of your growth now? You’re a few years in, how are you forecasting your growth? How are you planning your growth? How do you approach that aspect of building a business?
We’re unique and restrained in regards to we have to have more people. It’s an increase in headcount to support our growth, we have to grow as an organization to be able to grow our sales. It’s putting a huge emphasis on future recruiting plans. We recruit almost strictly by referrals. It’s insane. We have one recruiter. We went from 5 to 185 employees in a year and a half. We spent a nominal amount of money on any job ads. It’s all through referrals from our current employees. From a forecasting standpoint, aggressively given proper funding that’s the financial side of me that I want to have some disclosures, we could pretty easily and we have the client and the sales funnel to support it. Double our headcount within a year and triple our headcount within about eighteen months.
What do you need in terms of the funding for that? Is it because you have to bring these people on and train them and onboard them so there’s a lag in terms of revenue? What’s the funding for?
Full Scale COO: Communication is key to everything you do. Without it, you’re not going to get too far.
Generally, to hire anyone, we do full background checks, assessments that cost a little bit of money, and you have equipment costs so they are senior developers, which require specific equipment that’s a little bit more expensive than your standard laptop that any admin function might need. We have specific requirements. That capital can get a little bit expensive. It is difficult to procure internationally in more underdeveloped countries. That’s always one of our bigger challenges.
Additionally, this is still something that we’re working out. We’re much in the planning process but as I alluded to earlier, the capital costs for office spaces are insanely expensive. Typically, for a lease, you put three months’ advance rent, plus a three-month security deposit. You have six months of rent upfront, as well as a construction bond and you have to fully build out the space if you can find it. That’s been one of our biggest restrictions of moving forward in the past and was going to require the most amount of capital upfront to meet our growth plan on what we had hoped. With the state, however, we are reevaluating whether all of the office space is needed if we can get by with limited office staff.
What is your cash flow breakeven on a new hire? Is it about 3 to 6 months or 3 to 4 months?
It depends. There are two different types of new hires that we have. The new hires are going directly on to a revenue-generating client so we have insane client growth. The last time the numbers were run which was the end of April 2020, our clients grow on an average of the ones that grow about 176%. Our clients are often asking us to increase the size of their teams, which might mean we have to. They’re placing an order. We have to go out, recruit, assess, and fill the order so they come directly into a revenue-generating product. They’re a positive ROI from month one.
You’ve got some management of those people too, don’t you? Management and recruiting.
Yes, we do. The trickiest part of our business is managing essentially how much inventory we have for sale at all times. How many people are we paying to sit around and do nothing so we have the ability to offer our clients the ability to grow rapidly? That’s by far the biggest managing our utilization rate. It’s easily the trickiest part because then you get into how many dot-net people do you need on the bench? How many front-end people on the bench? How many mobile developers do you need on the bench? There are so many different roles.
If I had five of them all, our bench cost of the people that we were paying to sit around do nothing would be insanely high and they would go stir crazy pretty quickly. These are experts in their field. They want to be out doing what they’re good at not sitting around and getting paid, which is great for us but that’s tricky. The ROI on those people depends if we can find expert, borderline genius-level talent. We will hire them whether there is a plan in place for a client or not because those people are unicorns, and they’re difficult to find and hire. It varies depending on the strategy of the hire.
Your clients who are hiring you probably want these people to start within 30 days too, don’t they?
Yes.
They’re not looking for a 90-day startup with these.
That’s a cultural thing. We have a two-week notice here typically a month. They are often in 30-day to 60-day notice requirements and they can even be in bonded contracts that have to be bought out financially.
A little more complicated than you might have started when you were starting the company too. If you think about your skills on the COO side, what is it you’re working on to grow your skillset?
The skillset that needs growth is my communication. I try to do a good job requesting communication from everyone else and often I get bogged down every day. My workdays often can be 12, 14, 16 hours. Typically, when we stop working here, everyone in the Philippines is getting to work. If I’m not careful, my communication can get lost, and also, making sure that I don’t burn myself out is the trickiest part. Especially now that everyone’s working from home, I’m always on. I noticed the quality of my work as I do that can start to depreciate a little bit and I’ll be the first one. I admit that sometimes I’m good at spending a whole lot of plates but not being great at any of them at the moment. It’s making sure that I always have to be constantly working and striving to make sure that I’m effectively using my time and putting a full focus on the items that I am choosing to use my time on.
We definitely get some diminishing returns after we work past a certain point in the day. What do you think it was the founders saw in you? Why would they hire a big corporate big pharma guy into a small entrepreneurial startup? What do they see and did they think that it was any risk at all?
I have a long history with our CEO and one of our cofounders. We’ve worked together on and off for years and we are the perfect cliché match. The CEO has a million ideas, and the thing that he likes to say is that he is the person that will jump off the cliff trying to fly and I will jump off after him with a parachute and build wings to make sure he doesn’t crash. We work well. It is a natural click we’ve had ever since the start.
After we had taken some time apart and I had a lot of the more structured big company feel. It was something that he didn’t have a lot of experience with. He’s much of an entrepreneurial mind and he thought that I would be the perfect fit to come in, put in some processes, structures, and a box around what he was trying to accomplish, and turn his ideas from an idea into an executable plan. There were a ton of things that I didn’t know. I had no experience with international law, international construction. For a lot of the International aspects to it, I didn’t have any relevant experience.
It was definitely them taking a chance on me. What they saw in me is the drive and want to learn to make sure that I could accomplish anything. One of the things that I value highest in our organization is learning agility. Smart people learn how to get things done and they saw the ability in me to get things done and knew that I would work as hard as I could and as hard as it required to make sure that all that stuff was done properly.
You mentioned the trust and the culture if it was already there. They knew that because of the years of experience. That’s where so many CEOs make the wrong decision. They hire someone based on skill but without truly even understanding the cultural fit and norms of the person. When I was the second in command at 1-800-GOT-JUNK?, the CEO was the best man at my wedding two months before I even joined him at his company. We knew each other for years before I even decided to join him to help build it. That’s already similar to you. We already knew each other so well. Darrell, if we were to go back to your 22-year-old self you’re graduating college and getting ready to start out in your career, what word of advice would you give yourself back then that you now to be true, but you wish you’d known a lot earlier?
You don’t know everything. It’s easy for everyone to come out like, “I’m fresh out of college. I would like to consider myself pretty intelligent.†I thought I knew absolutely everything and I did not. I had no life experience. Listen to people and never be the smartest person in a room. Always look for a room that has smarter people and you listen to that experience. It’s invaluable. Take the advice. Don’t think that you know everything. That would be the biggest advice I’d have for myself.
This is one of the reasons why I love doing these interviews. I learn every time I do one. Darrell Blackburn, I appreciate the time and you sharing everything you guys have done at Full Scale. Thanks for sharing this with us.
Thanks, Cameron. This has been great. Thank you for all that you do. It’s nice to have a voice like yours when we’re in those low moments to go back and reflect upon and know that everybody’s been there. We appreciate it.
I appreciate it. Thanks for joining us.
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About Darrell Blackburn.
Over the past 10 years, Darrell has spent his professional energy honing skills relevant to increasing financial stability and operational efficiency in a number of different industries. From startups to Fortune 500 companies, Darrell brings a wide variety of knowledge about the positive and negative of each side of the spectrum. His experience includes helping to pilot a new clinical technological capability for a top-10 Pharmaceutical company.Â
While there, Darrell helped increase the adoption rate of the program from approximately 25% on Phase II and III trials to over 75% in just over three years. Most recently, Darrell has helped his current company, Full Scale, achieve rapid revenue growth of over 80% from 2018 to 2019, including 17 straight months of revenue growth. He has played an integral part in creating rapid employee growth, currently over 190 employees worldwide, while implementing and maintaining a culture needed to succeed. As Full Scale approaches its second anniversary, Darrell continues to push the employees and company towards efficiency and productivity.
