There’s a lot to be thankful for every single day. Today, we celebrate the 50th episode of the Second in Command Podcast. It’s been a fun year creating and sharing the podcast with all of the listeners. In honor of its milestone, we will be highlighting the most popular episodes that inevitably created a massive impact – from Theresa Labranche of Allure Medical to Roman Cowan of College Hunks Hauling Junk. We also had Brittany Walters of Scribe Media and Harley Finkelstein of Shopify. Rachel Pachivas of Annmarie Skin Care, Erik Church of 1-800-GOT-JUNK, and Anna Collins of Bulletproof 360 also graced us with their presence. Join us we take a look back at the timeless insights and the valuable knowledge that these industry experts unveiled.
Special Edition 50th Episode – The Best of Second in Command
I wanted to thank you for joining us on the 50th episode of the show. The people that you’re going to read from this episode are the people who were from our most listened to episodes of the first year. The people that you’re going hear from are Theresa LaBranche from Allure Medical, Roman Cowan from College HUNKS Hauling Junk, Brittany Walters from Scribe Media, Harley Finkelstein from Shopify, Rachel Pachivas from Annmarie Skin Care, Erik Church from 1-800-GOT-JUNK? and Anna Collins from Bulletproof Coffee.
We’re excited to share these highlights and brilliant insights from all of those guests. We encourage you to read all of the past episodes as well and also to subscribe and rate us on iTunes or anywhere. Please also share this episode with your friends. This episode is slightly longer than normal as we didn’t want to cut any of the crucial content. We did want to share all of this with you. I also wanted to thank my team for an amazing year of pulling this all together and also for helping us build the COO Alliance and the rest of my business. A huge kudos goes to Rachyl Blank, Meridith Kuba, Stephen Sofick, Jason Torres, Amanda Relyea-Voss, as well as the rest of the group that is always working to help bring you these great episodes. Without further ado, enjoy.
Theresa LaBranche from Allure Medical. You said something and I’m going to come back to it. I don’t even know if it dawned on you when you said it. I’ve known you now through the COO Alliance and through some coaching over the years. You often talk about the fact that you’re the only person who says no to the CEO and there to Dr. Mok. When you keep saying no, you often feel like you’re that conflicting opinion to him. You said right at the very beginning that when you first met him, even before he hired you, you had a bit of a conflicting opinion with something. You said maybe he respected that in you. You need to internalize that and know that he actually respects that in you. He probably spends most of his life where people don’t say what they think and they’re looking up to him, admiring him and trying to figure him out. You’re the only one or one of the only rare people who’s ever said, “No, that doesn’t work. No, I disagree. No, I think you’re wrong.” That conflicting opinion might be one of the core reasons why you are where you are.
I’ve taught that to my teams that quick starts inherently when they get a processor or a fact finder who needs more information, they take that as an opposition to their idea. I’ve now taught them to pre-suade the situation so that if they’re speaking to a visionary or someone who has a new idea to say something similar to, “I liked that idea. I think it might work. I have a few more questions this time to ask.” It lowers the guard of the person with the idea so they know you’re not questioning their idea. You just want a little more information.
I adopted the three-day rule early in my career here where if he came with an idea, I would support the idea. I wouldn’t ask many questions and after three days past, I would re-approach the situation. I would recap and make sure I had a clear understanding of his vision. Usually, it had morphed a tiny bit because he was saying the vision to get some feedback and develop it a little more and mulling it around. That was very effective. At that time, after the three days, I could see now it’s time to make the implementation strategy and the execution strategy. Before that, just let it morph a little.
I love what you’re saying about the pre-suasion part when you walk in and say, “I love your idea. I have a couple more questions before we can run with it.” I don’t know what the movie is but it was like, “You had me at hello,” for a quick start. That’s our love language. That would be any quick start’s love language to say, “I love your idea. Let me ask you questions because we were still thinking out loud.” For anyone reading this, if you haven’t done a Kolbe profile, I suggest you do it and have your CEO or your team do them as well. It tells you how you start projects. A quick start is someone who starts them quickly and then plans later.
Often, we’re accused of shooting from the hip or making it up as we go or winging it. Someone who has a very high first number is called the fact finder and they ask a lot of questions before they start something. The Kolbe is a four-number profile. The second number is called follow through and that’s a person who puts systems in place before they start something. The last one is implementer and that’s someone who needs the tools or a model in place before they can start. It’s important to understand with your team and yourself how you like to start things. It’s cool that you are doing those. Have you done any other personality profiles with your team?
We sure have. We prescreen all of our employees before they onboard with the Kolbe so that we know how do they take information fast? How can they learn the most quickly? What do they need to be successful and how their training is presented to them? Additionally, we use the Predictable Success model and identify who’s an integrator, who’s visionary and complement the Kolbe with that. For my direct reports, I have had them take the love language test. I know that sounds crazy but, Cameron, you recommended it to me, and it was so effective in understanding the difference of what a person needs to feel valued. It was enlightening to me. I instructed my direct reports, “Take this with your work in mind, not your spouse or lover per se because it would change the answers.” To my surprise, some of my direct reports actually had physical affection ranking in the top three. I never even considered the fact that someone may just need a hug.
Roman Cowan from College HUNKS Hauling Junk. Talk to us about what you believe are some of the core competencies for College HUNKS then.
From a core competency perspective, I’d probably say what differentiates us from the competition is that we are truly values-based. Our BHAG or our long-term vision in summary says we want to become an iconic brand. For most people when they hear that, it sounds vague. We say, “If you think of the business as the Apples, the Starbuckses and the companies that you are going to spend significant amounts of money with where otherwise you didn’t have to. For example, paying $4 or $5 for a cup of coffee where you’d pay $1 for that same coffee in a white cup. That’s the type of brand we’re trying to become. We want to be recognized for our culture, which we’re starting to be recognized for our client’s service experience and our franchise partner fulfillment.”
To do so, we think if we are purpose-driven, values-based and socially conscious, we can get it done. We are actively trying to become more socially conscious in our franchise partners territory all across the US and in Canada now. Share at the corporate level where we’ve partnered with Feeding Children Everywhere, an organization that allows us to donate two meals for every junk job we do or remove job we complete. That’s something that takes us a little bit further from a moving company or junk removal company into a purpose-driven, socially conscious company. We celebrate our core values every day. We hire. We retain, we promote and we quite frankly fire based on our core values and we take it extremely seriously.
Those are some of the things that are separating us apart from the sizzle, which is our name. It’s the fun, catchy name College HUNKS Hauling Junk and then our fun colors are orange and green, but beneath the layer, we are much more. When I come to work every day and I look at the type of people we’ve let in, I like to call them our lion pride. What we’re trying to do is an interview and sifts through people that don’t quite fit in the pride and that doesn’t make them any worse or any better. They can be a tiger somewhere, but we’re trying to get a pride of lions. They all have one commonality, which is culture for socially conscious, purpose-driven and they fit our core values. That I think is what differentiates us from a lot of different companies out there.
About your marketing, you came out with colors that are pretty out there. Orange and green aren’t exactly colors that anybody would grab as company colors, but they’ve stood you proud. You can see your trucks for miles as they’re driving down the road and your signage everywhere. Can you walk us through some of the beliefs that College HUNKS has in marketing? Maybe the guerrilla marketing side or the branding, positioning or anything that you think has helped you build your brand?
What I would say that our beliefs are you overwhelm the marketplace and own your market. We teach our franchise partners proprietary information about how to do so. Any person that’s in a market where there is a College HUNKS franchise partner, they should feel as if they’re 5x the number of trucks that we have in that market. That’s when we say you’re winning. When people are saying, “You’ve got so many trucks around here,” when there are only two or three trucks. We believe in overwhelming the market. We believe in excellent customer service, which is the first line of a great market. We think that if you want to retain and have repeat clients and referral clients, excellent service is where it starts. That’s why we want to become that iconic brand where when a College HUNKS franchise partner does a job in someone’s home, that person speaks about that job for weeks and weeks to come.
Hopefully, we’re going into the right people’s homes, the target audience. They’re talking to people who are similarly made up so that we’re getting more repeat jobs that are relevant to our industry in terms of our average ticket. We call it the average job size. We believe in standing out. You mentioned the colors. I’m sure you’ve read the book, the Purple Cow. It basically talks about if you see a field of cows, the black and the white typical or brown cows, you see one big old purple cow. People are going to drive pass, stick out and look and say, “Look at that.” People might even be interested in going up and saying, “I want to see the milk from that cow and not the milk from the other cows.” It could be the exact same but that allows you to stand out from the bunch. I love competitors as well. If you stick our truck beside them, the average person is going to take a look at the big old orange and green one.
We’re big on standing out for the right reasons, obviously for the physical appearances aesthetically. We’re also big on standing out for our service, which I mentioned our service philosophy. That’s a huge piece of our success in gaining so much market share in the moving side and on junk removal. We’re big on overwhelming the market in the sense that we want to appear larger than we are. It’s now that the image of College HUNKS that has been portrayed out for years has always been much bigger. The brand has always been much bigger than who we are as a company. As we’ve been doubling every two years, we’ve caught up to the brand, which is awesome that I’ve been able to be a part of the team to do that.
Brittany Walters from Scribe Media. When you’re running with all these freelancers, how do you manage the freelancers in terms of getting stuff done but also in terms of making them feel they’re a part of the tribe and part of the culture? How do you bring them in and keep them part of the culture when they’re remote? How do you manage them and get results through them?
It’s a bit different for our tribe members and our freelancers. I’ll answer the question from the freelancer’s perspective first. We’ve done a lot of work to integrate or at least to give our freelancers the option of integrating into a lot of the tools that we use. All of our project management happens on one singular platform that freelancers have access to so they can see the progress of their projects. They upload their files there. They can ask questions to our full-time team and the project manager there. It’s much easier for them to have the immediate support and access they need.
We also have a Slack channel that our freelancers can choose to join so that they have community amongst themselves. We regularly try to do freelancer Meetups in certain cities where we have a lot of freelancers that regularly contribute so that they can build relationships with one another and share advice with one another about how to level up their careers above and beyond the work that they’re doing with Book in a Box. We regularly share a culture with them. We share stories of things that are meaningful to us or details about how we’ve made decisions that a lot of freelancers would normally not have access to for the opportunity to connect with the company that they’re contributing to. They are the life source of the work that we do. They’re phenomenally talented. They contribute so much to the books and the other media products that we’re creating. We do try to constantly do right by them, pay them quickly, show gratitude for the work that they’re doing and invite them to be a part of the things that we’re excited about as a company.
What were some of the key lessons that you learned from looking at culture and being interested in company cultures?
The biggest one is trying to differentiate between phenomenal marketing and companies to walk the talk. For me, the biggest thing to look into to differentiate between those things is going back to results. What’s the trajectory that this company is on? Are they going to continue rising up? What is the history of results that they’ve already achieved or any patterns that you can identify in the way they’ve made decisions, the way they’ve honored their values, the way they’re communicating about their own culture, their values and principles publicly? All of those things are important.
When I was going through my interview process with JT McCormick, our CEO, Zach Obront and Tucker Max, our Cofounders, I interviewed each of them one-on-one separately. I asked a lot of the same questions because I wanted to see the consistency in their answers. Do they have completely misaligned perspectives of where the company is heading and what their place is in it? What my place maybe if I’m offered the position or do these things align? Are they frequently referencing their own culture and using that as a lens through which they’re operating? I was blown away by all of my interactions with everybody through Book in a Box.
I was born in Montreal and lived there until I was about twelve years old. When I was twelve, my family moved to South Florida to a place called Boca Raton, which is a great place if you’re retired. It’s not a great place if you’re a young man and want to have some fun. After high school, I ended up moving back to Canada to go to McGill University. On my first year of McGill, I started business mostly out of necessity. I had to start supporting myself. I built a little tee shirt business and we started making tee shirts for universities across Canada and built a nice little company. When I finished undergrad, I had a bunch of great mentors in my life at that point. Most of them convinced me that the tee shirt business I had had no competitive advantage. There was no moat around the business. Even if I was selling tens of thousands of tee shirts to all these universities, it was easy to disrupt me in the same way that I disrupted other incumbents.
One mentor, in particular, convinced me that to become a better entrepreneur, I may want to consider going to law school. He happened to be teaching law at the University of Ottawa in 2005. He said, “Why don’t you apply to the University of Ottawa and go to law school there?” I liked the business. I loved entrepreneurship. I knew I was going to be an entrepreneur for the rest of my life, but I wasn’t sure where I was going to go with entrepreneurship. The ability to learn more about the law around negotiation, around some complex corporate finance, understanding philosophies that I would get in law school was appealing to me.
In 2005, I moved from Montreal to Ottawa and I started law school. Although I enjoyed my first couple of weeks of school when I got here, I didn’t know anyone. I had no friends. I had no family in Ottawa. I had this one mentor who was teaching law. When I began to ask around where all the entrepreneurs hung out, I was pointed into a particular direction. On the side on that, one of the things I’ve done throughout my life whether it was something in Montreal then moving to Florida, moving back to Montreal then Ottawa. I always found that entrepreneurs in any city were typically where I’d find my tribe, likeminded people who I can develop good relationships with. I moved to Ottawa and asked where the entrepreneurs hang out. I was directed to a coffee shop in the Gilead, which is a small little area next to Ottawa. I was told that every Friday night a group of smart entrepreneurs hung out there. Without giving it any more thought, I showed up on one Friday night to that coffee shop and I met five or six entrepreneurs.
It was some people that some of your readers might know. It was Sam Zaid who at the time was building Getaround. He’s moved to San Francisco to build Getaround there. It was Paul Lem who built Spartan Bioscience. It was Luc Levesque who built TravelPod, who’s now a Senior Leader at Facebook. It was Tobi. The interesting part about Tobi was clearly both of us are polar opposites. He’s cerebral. He’s somewhat introverted. I speak too much and I’m far more extroverted than he is. Tobi and I connected at the weekly coffee meetups. Tobi at that point was transitioning out of selling snowboards online to the software company. As you probably know, he wrote this piece of software to sell these snowboards because he couldn’t find any great software on the market. He quickly realized selling snowboards is maybe a good idea but selling the software behind the snowboard shop may be a great idea in that he can help entrepreneurs from all over the world build their own businesses.
When I met him and he transitioned away from snowboards into software, I was looking for a way to continue selling tee shirts while concurrently going to class. In undergrad, I was able to skip class and show up for the exams. In law school, using the Socratic method, which is basically yelling out your name randomly and you have an answer to the question, it didn’t work nearly as well. I needed a business that would run virtually. I ended up becoming one of Shopify’s first customers. I built an online tee shirt shop called Snooper with my best buddy in law school. We ran it concurrently with class and my course curriculum all throughout law school and then throughout business school, I did my MBA. That was about 2008 at that point.
In 2008, I decided that I want to get called to the bar. I wasn’t sure if I wanted to be a lawyer. To be honest with you, law school for me was finishing school as an entrepreneur. It was like an etiquette school to be an entrepreneur, which was exciting to me. It had little to do with the law itself. It had to do with the way of thinking, a way of arguing, a way of negotiating. It taught me how to read 4,000 pages and to pick out the one line that mattered most. It taught me how to be a bit more articulate and how I express myself. I loved law school, but I knew I didn’t want to practice. I didn’t want to get called to the bar because I felt that was the last step in the process. In 2009, I moved out to Toronto. I worked for a large law firm and I articled for several months. I hated it. It was the worst several months of my life, unlike entrepreneurship which I felt was all about meritocracy.
I felt that the legal profession, not too dissimilar from things like the accounting profession, a lot of it was about legacy. It mattered how long you’d been there. It mattered who you knew. It didn’t feel right to me. I stayed for several months and one day longer, which was exactly the amount of time I needed to get called to the Ontario Bar. I called Tobi and I said, “I love Shopify. I love the product.” At that point, it was Tobi, Daniel and Cody who are the three Cofounders of the company. They were all brilliant engineers and designers. I’d known them for a couple of years because I was an early merchant and an early customer of Shopify.
These were three of the smartest people I’d ever met. What was cool was they had a great product. They were beginning to find product-market fit, but none of them self-identified necessarily as someone who was focused on the business side of a company. They were on the technical and the product side. I called Tobi in 2009 and said, “I’d like to move to Ottawa and help you, Cody and Daniel build out Shopify. I’d like to take on the business responsibilities of the company.” That was it. My girlfriend at the time who’s now my wife and the mother of my child, we moved to Ottawa in early 2010.
I remember asking Tobi, “What do you need me to do?” He basically said, “Whatever you can.” I remember thinking that my job was finding the things that they either didn’t want to do or didn’t know how to do. Making sure that this amazing product that they had built, which I felt was by far the best product on the market that we were able to commercialize it properly, sell it, market it, retain customers, build a business. I would say my first couple of years at Shopify was mostly being a Swiss Army knife. We raised our first round of financing in mid-2010 and we had no CFO. We had no GC. I helped raise the round. I figured out what a cap table needed to look like. Along with Tobi, we went ahead and raised $7 million and that was led by Bessemer.
That was my first introduction to being in a Chief Operating Officer role or a Second-In-Command role, which was that my job isn’t necessarily this one thing and do only that one thing. It was figuring out what the gaps are of the company that were going to prevent us from getting to the next step, the next level that the other three were not tackling. The first couple of years was mostly around building a business around Shopify, building a partnerships team, building a business development team, figuring out what sales should look like. We didn’t have a CMO at that time. We were closely trying to build out a marketing team. That was the first couple of years here. It was about being a Swiss Army knife and helping Tobi however I could.
It’s all almost like a marriage where you’ve got to have date nights and systems in place to make sure that the relationship stays strong. What do you do to keep your relationship strong and growing and to keep the trust high?
I get a lot of calls and emails from companies all over the world asking about my dynamic with Tobi. We talk a lot about being the yin and yang. Unfortunately, it’s a little bit of a cop-out. It doesn’t provide much insight in terms of that dynamic. A couple of things had been important to us. He’s my boss. He’s also my mentor. He’s also one of my closest friends. We spend a lot of time together. We spend our weekends and think cases together. Our relationship extends well beyond the office. In terms of making sure our dynamic is as effective as possible, the onus is on me as the COO to check in with him to make sure he’s getting everything he needs from me.
I checked in with that fairly often, in some cases, almost on a quarterly basis. I would say, “Here are the different areas of the business that I’m focused on. Are there any things that I’m not doing that you think I should be doing? Are there things that you’re doing that you do not want to be doing but I can pick up for you?” A lot of the problems that I hear from the CEO, COO relationships often stem from other misalignments in terms of expectation or the data or the perspective that they are working through is dated and things have changed.
For example, I was the General Counsel up until 2014 or so. I wasn’t a good general counsel. I was the only lawyer here. I’ve played that role. Tobi and I always knew that was not going to be the thing I was going to focus on. We needed to hire a great general counsel and we only needed it as we began to think about our IPO, which happened in 2015. It was easy for me to take that off my plate because that wasn’t something I felt that I was a little class at. It was not something I enjoyed doing and it was not something that I believe that I could do better than anybody else.
It was obvious to have that off my plate. It was the same thing in 2011. We hired Russ who’s our CFO. I understood the corporate finance side of running a business. I understood how to raise money because of my business background and going to business school, but I was not a good quasi-CFO. Ensuring that there is realignment almost on a quarterly basis, maybe it’s a different cadence for others. Maybe it’s a monthly basis and saying, “This is what I’m focused on because I can be world class at this. This is how it can have the biggest impact. This is something I enjoy doing.” Using those three vectors, you end up with a good dynamic between the CEO and the COO, especially if you continuously check in to make sure those things haven’t changed.
A couple of years ago, Tobi walked into my office and said, “We’ve got to build an enterprise product. We have to think about how we help much larger.” What had happened was the background here was some merchants had started on Shopify and they were small, at their mom’s kitchen table. A lot of them were to be $100 million a year businesses. They didn’t leave Shopify. They weren’t graduating off our platform which is fairly unique in the SMB software market. He came in and said, “We’ve got to build this.” We needed a sales team, but that wasn’t something I was especially good at. I have no experience building out a massive sales org. It was clear that I needed to create some scaffolding.
I have to create a foundation to make sure we did have some product market fit, to make sure we did test some assumptions and that there was some momentum there. The second we were able to check those boxes, we have product-market fit, momentum and scaffolding. I went ahead and brought in more Loren Padelford our VP of Sales and plus to run this operation and scale it. The reason I bring up that example was Tobi wanted me to get that started because that’s what I’m good at. At a certain point, my ability to scale that had diminishing marginal returns and it was time to bring in someone else.
If the COO and the CEO are not connecting on a regular basis to align and ensure that we both have an understanding of what the most impactful things that I should be doing are, there are tension and confusion. All this bad stuff comes from that. Tobi and I meet every single week for a one-on-one. It’s my one-on-one. I bring to him the questions, the insight, the information I require from him in order to better do my job. Whether it’s every month or every quarter, I’ll use that one-hour one-on-one to ask him. “Here’s where I’m focused. Are there any things I’m not focused on that you think I should be? Is there something on your plate that you think I should take off your plate?” By being candid, transparent and honest with each other, we’ve been able to cultivate what is one of the best relationships I’ve ever had. He would say the same.
What is it that you’re doing that has turned Shopify into this magnet for great talent?
It’s obviously not perks. It’s funny how often people confuse perks with culture. We have some cool perks here. We have full-time chefs in every office that cook delicious healthy food. Every person at Shopify gets maid service at their home that we pay for. We send cleaning staff to their homes to clean their houses twice a month. All that stuff is great, but it’s there to make their lives a little bit better. That is not a reason to work here. Those are things that we think make our team’s lives a bit better. The culture here has been organically developed over time.
For the most part, most people at Shopify can have their own companies. They can be the COOs of their own companies, but we believe we can come together. It’s like the Avengers. We’re unstoppable. We’ve created a place where founder types, founders, entrepreneurs and people that are self-starters that typically would be doing their own thing, they can not only come to this place, but they can thrive in this place. That’s one area that is important. We have a policy here which is default to open. Even during the IPO process, there were some things that we couldn’t disclose the whole company. That was difficult for us. Most other companies that would be no problem, but it was for securities regulation laws.
There were some things that we had kept to a much smaller group of stakeholders. That was tough for us because we are default open culture. Once a week or in some cases once every two weeks, we do an AMA, an Ask Me Anything, where anyone from the company can ask the exact team or the leaders of the company any question they want. They can do anonymously or they can add their name to it. That ability to put ourselves in a vulnerable situation where people can ask anything they want but also get an answer that they feel they’re being treated like a sophisticated adult makes us a great place be.
Lastly, most people at Shopify are doing their life’s work. That is unique. For most of us, it’s not a job. This is what we want to do. This is how we want to spend our time and with the people that we want to spend our time with. A lot of the companies that maybe you’re talking about potentially are looking for a shortcut to how to cultivate culture. If you put a gun to me and said, “What is culture?” I would say that culture is probably what people do when no one is looking. What happens when no one’s around and people are left to their own devices? What do they do? If they do the right things and you probably have a great culture. If they do the wrong things, you don’t have a great culture.
Rachel Pachivas from Annmarie Skin Care. When you were starting off in your role as COO, is there anything that you wish you’d known before you started looking back that you would have done differently?
Possibly hiring, that’s a big one. I feel like we’ve honed in on our hiring and onboarding process. I wish I had what we have back six years ago to hire that team. The first couple of years, we’ve gone through a few team members. We haven’t had much turnover, which is great. That hiring and onboarding process would be something that I wish we had more of.
What did the hiring and onboarding process do? What mistakes did you stop making it because of what you put in place? What is the hiring process you’ve put in place?
It’s pretty intricate. It’s long and lengthy. We send them our vivid vision and our culture guide and we make sure they’re aligned with that. We want to know that they’ve read it. We might reference that during an interview. We have them do a phone or Zoom interview with the direct supervisor if it’s not me. We’ll have them do an in-person interview. I like to take them into some public settings, see how they interact with the service industry, which I think is great. We might have the same move forward. We’ll have them do a team interview. It’s where they meet the entire team and we get an idea of who they are and how vulnerable they can be, if they jive with us. That’s a big thing because we have such a huge team. We want everybody to feel so comfortable coming into the space.
We do things like the Kolbe Test in the Color Code Test. The onboarding is a week to a two-week-long process where they’re getting fully trained in the products, story or a mission and their role. They’re doing shadowing sessions with all the other team members to get to know them. I don’t think we did any of this. We just did an interview. We didn’t do any of it. It’s so useful to have all of these tools. All of this stuff I’ve learned over the past couple of years being at the COO Alliance and meeting people there. You pick one thing from one company and a person that you meet. Maybe you all try another thing from another person. We have quite a few different things that we do to bring somebody on board and have them be a part of the ASC team.
When we go to the grocery store and we’re looking at things like organic food versus normal food that we were used to several years ago, the price just seems to be so much more expensive. I was looking at a dozen organic free range eggs. They were $7.15 and then the standard ones were $4. How do you build the pricing or the cost of everything into your products to be able to come to market with stuff that is so safe and still makes a little bit of market?
Eggs are one thing. The food industry, it’s so backwards the way we look at food and health in this country. The way that genetically engineered crops and conventional farming is subsidized by the government, that’s one aspect. Looking at skincare, a lot of the skincare companies out there, conventionally, they’re producing products that have toxic chemicals in them. They’re cheap and inexpensive. When you use them, you’re also factoring into a health cost at the end. There have been studies done back in New York University Medical Center. They had a study showing an annual health cost of $340 billion linking to endocrine disrupting chemicals. That’s our daily exposure and that goes into a $340 billion a year annual health cost. Taking that alone in wanting to avoid chemicals in that way for your health bill, you feel okay spending $50 on a moisturizer that’s using pure, raw, amazing ingredients, well-crafted ingredients, avoiding fragrances, phthalates and chemicals that are harmful to your system.
How do you balance out the need to be able to sell to a consumer with doing it all the right way? I ask this hoping that the rest of us can learn how to continue doing it, but it’s the opposite of what we’ve been told so many companies were doing forever, which was offshoring, going to the cheapest market, using child labor and all the bad stuff. You guys are almost the exact antithesis of that. How do you do all that and still keep your products in a price range that works?
It’s interesting because it is expensive to do all these things. It is expensive to provide amazing paying jobs where our team members are super excited to come to work. It’s a great year that we have and at the end of the year, we were profitable. Thank goodness. We’re not making billions. We are not some massive corporation making tons of money where the CEO is off-shore making billions of dollars every year. We’re okay with having a quality of life that’s great. It’s having acceptance for that, having that balance, knowing that our purpose here is to create some things better and not to be greedy. To me, that is one of the most important things about it.
Erik Church from 1-800-GOT-JUNK?. With Acacia Fraternity, did you pull any culture or cult ideas from there into your business?
We go back the importance of a common sense of purpose and finding meaning in what you do. Going back to my days in university, I found more meaning in the relationships and the activities doing with my peer group, whether at Acacia Fraternity. The learning came with leading your peers, working with your peers, but striving for a common goal. That was important to me, but certainly the idea of how you bring people into an organization is equally important because you want people to start to learn and onboard the culture. New students would come to the university and join the fraternity. It’s how you onboard them was important to how they worked within the culture, how they added to the culture.
As we look back, the culture is going to be enhanced from where we had it, but we have the same foundation. That onboarding process, I’ve certainly learned that. It was not similar to my time in the military. One of probably the most formative times for me in a cultural organization is a company called EF Education. They have their $6 billion company, offices in 45 countries around the world and I had good fortune running one of their divisions. To participate in an organization where culture is strong, whether you’re in Germany, Japan, Canada, United States, Switzerland, you can get the sense. You get exactly what the culture is regardless of what the culture is of that country. The culture of the company shines through. That is for me the value of culture coming from College Pro, from EF Education and at O2E Brands is paramount. Culture eats strategy for breakfast as commonly said.
Give me a bit of a background as to where you came from. You came into this with a lot of experience and you walked into a $100 million company, whereas when I started there, it was only $2 million. You walked into a $100 million company and grew it. You came in with a lot more experience in your role than I ever did. What was it like walking into the brand?
Brian Scudamore and I had a conversation to me being inside the organization had connected through a mutual acquaintance and yourself as well. He’d pointed out to me that I had made a career working with founders and helping founders bring their business to the next level and helping them realize their true intent and what their mission is. My background has been working with a variety of founders and organizations ranging anywhere from a startup up to a couple of billion dollars. I find myself in a place where I can be most successful when I’m partnered with the founder and I can help drive an organization to the next level by working towards those goals that are going to have the biggest impact on achieving those goals.
You talk about Brian being the visionary. Does he still use the painted picture concept?
Absolutely. It’s pivotal in not just 1-800-GOT-JUNK? but all of the brands of WOW 1 DAY, You Move Me, Shack Shine and the O2E, Ordinary 2 Exceptional company being the parent company of all of those. They have separate painted pictures for each of those organizations and we encourage everybody individually to have their own painted picture for themselves.
What came naturally to you as a leader that you can share with us? What were you faking that you had to work on or that you suck at?
I look back at the early days of leadership, whether there or in rugby or my first business opportunities. I think, “How is it possible I got anything done? I was such a crappy leader.” While I appreciate your accolades, in retrospect I look back at it like, “I can’t believe we did what we did.” It’s all relative at the time. The migration for me as an individual was if I look back, I had way too much command and control in my world. One of the things I did learn at the fraternity was how to work with your peers and how to get by them, how to use your ears more than your mouth and get the common sense of purpose and then how to lead people to that right area. It’s holding people to a standard that they want to be held to and not letting them slip.
What advice would you give them going into that event?
It’s a great opportunity for networking and it builds your network of support in your group. I’m fortunate to be in YPO. I’m graduating because I’m too old to be in YPO. The forum group I work with is powerful and it influenced me and made me a better person. Create your own forums in your COO Alliance, work with that group and hold each other accountable. Oftentimes, there isn’t anybody out there who’s holding us accountable even inside our organization. What I love about my forum is they hold me accountable to what I say I’m going to do month to month, both personally and professionally. That’d be a cool way to connect with other people in similar roles, but also sharing best practices around if they are working with a founder, visionary type, how that works and how that two in a box can work.
This is a concept that Brian has, which is two in a box leadership. What it refers to is at the top of the org chart, you’ve got a box. Instead of having two boxes, a COO and the CEO, you have in one box an angled line across the middle thing. We are operating together, not in a co-CEO role, but as two in a box decision making and defining a role. I say if that’s the relationship you have with the CEO and founder that works well. If that’s not what you have, that’s not a great recommendation. Figure out what relationship you have between COO and CEO. Find those people who are similar and work with them to refine your skills. There’s a great book called Rocket Fuel, which talks about what it means to have this concept of two in a box. They call it something else, but it is similar. In there, there are some specific agenda items on how you stay aligned and how you divide responsibilities.
Gino Wickman created Traction. That’s a great book to recommend. Do you take the two in a box concept down to working a VP that reports to you?
I don’t. That’s in this book. Certainly, reading Gino’s book as well. That’s designed for the CEO, COO relationship. As we build out each of the brands, each of the brands has their own managing director, 1-800-GOT-JUNK?, WOW 1 DAY, You Move Me, Shack Shine. I’m starting to work more closely with them in those two in the box mentality because they are running their own organization.
What’s your typical day like? You’ve got a bit of a strange one because you live part-time in Toronto and out in Vancouver at the head office. Tell us how your typical month and typical day work.
I don’t have a typical one, which is great because I like change. I’ll either fly in anywhere from Sunday night if I have early morning meetings to be in for Monday morning or I’ll fly on Monday night and be there for Tuesday morning. We have an office here in Toronto with about 120 people. I need time in those offices. I try and set up, so I at least have Fridays in the office in Toronto and more typically Monday through Thursday in Vancouver or out meeting with franchise partners. We have a fantastic marketing consultant in Austin, Texas. I try to get down seeing him on a regular basis. With the time that I have in the air, I have roughly nine hours of focused time to myself on the plane where I get to do the reading I need to do. I get to do the research. I don’t go on Wi-Fi. I avoid email. This time is valuable to me to prepare myself for the whole week or finish the week. Those weeks where I stay in Vancouver and I missed those nine hours of focused time, it’s a terrible thing. If I miss a week of commuting back and forth, it’s tough.
You do use that time effectively.
It’s highly scheduled, regimented time that I use. For two hours, I’m going to read these articles or I’m going to make sure I read this in preparation for our executive steering group. I use that time specifically and it’s scheduled out.
Your marketing consultant down in Austin is Roy Williams, the Wizard of Ads. That guy is unbelievable what he’s done in his business. Does he do more than radio or is he still on the radio?
It’s radio and TV. His creative ability is second to none. He does have a philosophy which makes him effective, which is he will only work with the decision-maker in the organization. Brian, myself or David St. James our Managing Director at 1-800-GOT-JUNK? has to be present at the meeting. For anybody else that’s there, one of us has to be there to make the decision ultimately. It’s a rate-limiting step for which companies you can work with, but he is specialized in working with those companies where you can move quickly. He also challenges us in operation. Operational constraints are of no issue to him. He says, “Open to midnight.” He doesn’t want to hear anybody say, “Tell us all the reasons why being open to midnight’s a problem.” He does focus on what the customer wants and that does challenge us operationally and especially as a franchise system. It’s hard to do, but anything worth doing is usually hard to do.
Anna Collins from Bulletproof Coffee. You mentioned something early with some of the projects that I can’t remember the term you used, but it’s like greenlighting some and yellow lighting some. It was not any, but not right now or not yet or trading one off for the other. Dave is a spectacular entrepreneur. He has 100 ideas, 90 of them are good. How do you get someone like that not to want to start all of their ideas? What’s the system you do to grab the ideas, track the ideas, and not kill their spirit? How do you keep him excited? Do you have those ideas without killing it off and without having to start them all?
One part is where we can take an idea? If it’s not now, let’s set a time frame to revisit. For example, I created a series called What The CEO Needs To Know. I said, “Every month we’re going to do product innovation reviews with you and spend 90 minutes on chronic innovation,” so that you’re not wondering where these things are in the innovation pipeline. When we take a trade-off and we say, “We’re going to do this and not that. We’re going to sequence this over here and have these streams that match up to different consumer segments.” We’re going to have a cadence. It’s not going to disappear. This is a way to continue to have visibility. At the right level and with the right framework, it’s not a freeform brainstorming idea of other things you want to do. Let’s put in a context where we’re talking about implications and tradeoffs that we will make on the business and our customers. It’s not freeform, “It’s out here, which is the entrepreneurial way to do it?” Let’s say your thing is already an idea, “They’re all great.” Let’s bring him down to the reality of business and customers and what the implications are.
I got 74 different areas to go with you on this stuff.
My basic framework for leadership is I’ll say it’s fun. My favorite quote of leadership is, “The first responsibility of a leader is to define reality. The last is the same. In between the two, the leaders both as servants and a debtor. That sums up the progress of an artful leader.” That’s from Max De Pree’s Leadership Is an Art. What I love about that is the first responsibility of a leader is to define reality. The reality for me is what the state of the union for all facts on the ground is? How many skews do we have? How many customers do we have? What are the segments? Who are we serving? What is our cash position? Everything of the reality, what’s the team capability? When I walked in the door, I did that. What’s the reality now? That was the first thing he did for sure. I said, “Here’s my state of union report. The other part of defining reality is the opportunity, the vision, the possibility, which is what I was talking about. Here’s the big vision. What are the roadmap, strategy and goals that are going to take us there and both on the small tenure? Setting that reality up, which was true and the possibility is that frame that I’m operating with Dave and the team.
How far out do you plan versus how far out do you allow yourself to think with Dave and vision?
There are different time horizons. We’re doing the big vision. When I walked in the door, I was interviewing with the company, it was clear that there were a strong mission and a strong vision. Talking to end values like gratitude is a value that we have at Bulletproof. We have seven other values. If you asked different people on the team when I walked in the door, I did and they would give you ten different answers for what the vision is, ten different answers for the mission. They would all say gratitude is one of that values that you get on their answers. In the first night is I went through a process with Dave and the team using employee input, customer input, and the facilitator. We define this definitively what our values and the vision-mission to be able to say it and everyone would say the same thing. We use that frame to start doing performance reviews to start to do the hiring, interview and baking them into the process to help us scale. That’s another example of creating a common reality, the context for the team and us all to operate and practice business. That vision is a twenty-year vision to tap into the unlimited potential of being human.
That’s when you’re always communicating and talking about. You’re probably planning in a more granular basis than three out, two years out?
We have the strategic planning process. I use a three-year strategic planning process. We do that. We have our annual operational planning. We do the three-year planning process ahead of the one-year planning. We’re constantly doing the three-year planning ahead of our one planning. We do mid-year to check-in with that.
If you were to go back to Amazon for a bit and think about when you left Amazon and came into Bulletproof, what skills did you bring with you from Amazon that you still use or what styles of leadership did you bring in? What did you have to change? What were you may be great at or doing at Amazon that wouldn’t work in the entrepreneurial world and you had to reinvent?
It’s a tardy answer. The Amazon question because I spent a few years at Microsoft. What I’d say is when I bring all of that, as Amazon ruined me forever with, for example, PowerPoint because at Amazon you can’t do PowerPoint. You can only write narratives. It’s only written word. Every meeting starts with a document and nobody talks until everyone meets the document. A document has data in it. Therefore, you do that for any number of years. Any other meeting is crap compared to that. What I didn’t want to do, when I walked into Bulletproof is crush this entrepreneurial company that didn’t ever write anything down like a narrative. What I did was I started sprinkling and demonstrating some practice of the document or narrative form. I had brought some other mechanisms to increase in the keep of data and the analytics capability, which Amazon had to strengthen and create a weekly business review. I didn’t start the first year doing a weekly business review. By the second year, we have a business review. What I did the first year was to create a data analytics capability and started building that up so that we could do those other things. Those are normal scaling uptight stages to go see.
They’re normal except a lot of companies don’t do it. You talked about data analytics. I was talking to a client that I coach. They measured everything. He was showing me all the metrics. I was like, “There’s no way you can ever look at all this data. You have so much data. It’s almost like plugging your Porsche at a car dealership and looking at the 75,000 things they measure.” What are the most important ones? How did you decide what to measure and how to look at it? Who was looking at it? Can you walk us through some of that?
It depends on areas you’re talking about or the input/outputs. Some companies and practices look at outputs. Revenue is an output. What are the inputs, the number of customers and on and on? An eCommerce business you have customers and average order value ahead. What are the inputs? There are inputs to the number of customers who have to do with new customers and return customers. For an eCommerce site, you have the traffic coming in. How many visitors are visiting? What’s our conversion? Conversion visitors and traffic or visitors and conversion are input metrics to average order value and revenue in units.
I’m giving an example on how you can start looking at it, saying, “What matters?” Those are all metrics that matter. Inputs and outputs for the daily business. You can drive and say, “What impacts conversion on a website, on a product detailed page.” You start talking about low time speed of the page, usability, what information or content is on the page, where it’s positioned on the page? I could go on and talk about there’s advertising. It depends on what area you’re talking about that’s different than supply chain or retail distribution.
With your people, the stuff that you are the best out of, if your team was to describe you right now, we’ve certainly got a huge glimpse of it. How would your people describe you as a leader? Are any of them remote or is your team all office-based in Seattle?
We are a combination of remote and based in Seattle although we’ve continued to create a critical mass hub here in the headquarters in Seattle. My direct reports are mostly here. A couple of them are remote if that’s the question.
How would they describe you as a leader?
I’d say direct, demanding and likes data.
You said that you finish everything with that, “Thank you,” with that gratitude. Is that natural for you or do you have to work?
The gratitude, I do the, “Thank you.” The other thing would be connecting and caring. I was thinking about leadership. If you’re going to say my leadership style is what people say distinguishes my style is high, I’d say character, competence and caring. The character is how high integrity and high intention that shows up. The competence part is strong basic capability. This has to be like don’t suffer fools. It very quickly has a strong point of view and communicates directly around whether we’re interviewing somebody right on an interview loop that creates clarity and had a strong point of view on that and communication. The caring part that I do care about each individual and I care about them professionally as a person. What that means is I’ve been invested in their success as well and work to be that leader that is not only helping to provide clarity on the reality as a servant in helping arm lock and be of service. What can I do to help with Dave and their team?
You’re clearly one of those exceptional leaders. The ability to straddle and go back and forth between the corporate world and in the entrepreneurial world back and forth is I don’t see it virtually ever. It’s pretty amazing to watch and to have seen you over the last few years. If you were to have that one final word of advice, not for our audience, but for yourself. If you were to give your 21-year-old self a bit of leadership advice, what would you wish you had known at 21 you know to be true?
I did it at Microsoft. When I was at Microsoft, there was a woman who wouldn’t book Alan, I can’t remember the last name. His letters to his younger self. I did a panel on this. I had a whole letter I wrote to my younger self. The number one thing would be don’t take me so seriously. I can say that. I still struggle with that one because I overdo it on the serious part and my responsibility back to one of my opportunities.
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