Episode 241: Fireside Chat - How To Forecast with Isaac Stuiso

So the big question is this: how do small business owners like us grow our leadership, develop our teams, and scale our business in a way that allows us to get our products and services out to the world yet still remain profitable? That is the question, and this podcast will give you the answers. I'm Bradley Hamner, and this is the Club Capital Leadership Podcast. Welcome to The Bottom Line, a new weekly podcast series that we drop every Thursday to complement our weekly Monday podcast interviews with the industry leaders.

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So with that, let's get into today's episode.

Hey, what's up everybody? Good to see you. Glad you're joining us with this today. We'll get rolling here in about a minute. Man of the hour, Isaac, is in the house. This is going to be killer. People, if you listen to the podcast, you know that I take your time and especially your attention very seriously. So we're going to do everything we can to serve you for the next 30, 45 minutes or so. See how I provide you a lot of value. I'm excited about this. This is a lot of fun. Usually when I'm doing the podcast, it's like just me and Isaac. It's not like thousands of people, but it's cool to have everyone to be able to join us. Chris, we ready to rock and roll, my man?

Let's go, sir.

All right, cool. Well, welcome everyone. My name is Bradley Hamner. I'm host of the Club Capital Leadership podcast, and we're going to do this a little Q&A style. So I've got the chat and I've got the Q&A pulled up over here to the left on one of my screens. And so as we go along and you've got some questions, I encourage you to be able to participate and, and ask, and I'll be, uh, Q&A on the chat and Q&A. So, uh, Isaac, in true to form with the podcast, why don't you give a little bit of kind of your background and origin story first, and then, uh, I'll start teeing you up with some questions.

Sure, so, uh, my name is Isaac Stutho. I've been a State Farm agent now a little over 3 and a half years. Started out my State Farm career working for an agent in my hometown of Newport Richey, Florida. I was born and raised here in Tampa Bay area. Worked for that agent for about 7 years. I absolutely loved what I was doing. Turns out I was, I guess, pretty good at it too. So got the opportunity to open up my own agency September 2019. Um, graduate of the University of Central Florida. Uh, I guess I should mention my agency is in a little hidden gem of a city called Dunedin, uh, which most people have probably not heard of, but it's about, I don't know, 15 miles northwest of Tampa, right on the western coast. I'm married, no kids, having a lot of fun growing the agency over the last 3 years and looking forward to more success in the future.

Awesome.

All right.

So the first question I want to ask you is, I think all of us have, you know, we have come into our small businesses with different skill sets. Okay. And for me, I should have known how to manage or how to look at financials. Got a degree in finance from Auburn. My dad's a small business owner, yet I had no idea what I was doing whenever I started my business. And so just give people a little bit of kind of your background of skill set of understanding small business financials. What was that like for you whenever you started your business?

Evolving. So prior to opening the agency, I'd always constantly be reading, you know, Wall Street Journal or, you know, listening to different financial, you know, podcasts or audiobooks. Um, I guess my approach to financials though is I try to keep it super simple. Um, so I know at one point we were talking about what the title of this, uh, this chat was going to be, and I think it was— it's gonna be something like maintaining positive cash flow, right? But we changed it because, you know, that's easy. You just spend less than you make. That's how you maintain positive cash flows. Um, but I guess overall my approach, I've always kept my, my personal financials very lean. Um, you know, when I started working for the agent, uh, before opening my own office, it was with the anticipation of, of having this opportunity. Um, and so for that reason, I tried to stay away from a lot of debt. Um, Like I said, keep my personal expenses very lean because I knew that first year I was going to need to be able to reinvest all the revenue that was generated in order to really get this thing off the ground. And I guess I kind of run the agency in a similar fashion. As far as diving into the numbers, you know, Club Capital gives me a lot of really good reports, especially their forecasting. Reports, which is super helpful with basically we're able to kind of project out for the next 12 months what expected revenues are going to be, what expected expenses are going to be. It really helps me kind of keep a finger on the pulse of the agency as far as making different marketing decisions or hiring decisions. So it's my financial background and looking at financials. Is maybe not that fast, but that's why I outsource it and have a great team of people that help me with it.

How did you approach— you mentioned reinvestment, and so I totally can relate to that myself. One of the things looking back on it for me was that I was reinvesting with no end, no plan for whenever, when, when, when was I going to be able to start taking home more money in my business? Right. And so how was— how did you approach that? Then? And then maybe how do you approach that now? And kind of what I'm getting at is this level of understanding reinvestment, but at the same time the break-even part, and then starting to be able to grow profit every year. Does that make sense? Sure.

Yeah. So I guess when I first started, um, like I said, I had 7 years working for an agent anticipating day one, right? So I guess my plan when I opened was to have enough money saved up to cover all of my personal expenses. So if I didn't make a single dollar of profit that year, I'd be fine. Um, I guess initially my timeline was a year. I was going to take that first year and reinvest absolutely every dollar of profit into, uh, hiring, you know, more team members or expanding our marketing. Whether it's, you know, different kinds of marketing or buying more internet leads or sponsoring more teams or, you know, attending more events. And then nowadays, you know, I really lean on the forecasting model to let me know when the best time would be to reinvest. And my go-to reinvesting is hiring people, right? The more people you have, it just seems to generate organically more production, which leads to more revenue, which leads to a better bottom line. Um, but as far as like the break-even points, um, like on my initial investment— is that what you're referring to, bro?

Part of it is on the initial investment, part of it is on whenever that part where, you know, you were, um, profitable in the business to where you're not just reinvesting the profits every year and then being back down to say zero, right? So how you balance between, okay, I made $100,000 in profit— I'm just using a round number— to, okay, now if I make this investment in one or two extra team members, that's going to reduce my profit in the short term, right, from a short-term profit and cash flow perspective. But then the ultimate, uh, I can see the numbers forecasted out to where that's actually going to end up paying more dividends in the future? Like, how do you— how did you look at that? And then how do you look at that now?

Yeah. Yeah. So actually, I remember I got on a call with Micah at one point and I asked him to see if he could help build a scenario for me into our forecast. And then basically I sent him my compensation structure for like a new team member, right? Like what they get paid based on what they produce. Um, I told them what the starting salary was. I said, hey, I want you to build this out for me based on my average, uh, production expectations for a salesperson, which, you know, 20 autos, 10 fire, 2 life, 2 health. Um, and so we did that. We took that, we ran those numbers to figure out, you know, on a team member that we bring on, if they hit those average monthly production goals, I'll break even on them in about 18 months. Um, so that, that's how I go about that. And then what I kind of gauge currently is there's a— I've always kept my personal and, uh, business finances separate. I know some, some folks kind of intermingle the two. I've always been super diligent about not doing that. So I have a really good idea of the health of the business. Um, and then basically what I do is in the operating account, uh, you know, once it surpasses 2 months worth of expenses, then I take a withdrawal from that. And that's kind of how I gauge when it's time to, you know, give Papa Bear a little bit more money in his bank account kind of thing. I don't know if— does that answer your question?

It does. Yeah, it's actually one of the specific questions I wanted to ask you about is around, you know, this idea of owner compensation. So we're going to go back to that in just a second. So let's stay on this idea of how do you balance whenever you're setting— you're looking at production targets and you're looking at your financials. How would you suggest someone to balance their— well, let's just say their goals of what they're wanting to do. They're wanting to increase their production. They're wanting to go from, I don't know, 75 autos produced in a month and they're wanting to be able to get it to 100. Okay? And they think that another producer is going to be able to do that and then probably would. But then they're also kind of wanting to go over here and they can do that pretty easily on a piece of paper or Excel. But then also they need to look at and consider their financials in making that decision is, do I have the cash flow? Do I have the money to be able to do that? And if I don't, then I can maybe— you, that's where you could, could in some cases leverage debt. And maybe we can discuss that. I know you mentioned debt already a minute ago, but different people have different opinions around utilization of debt. But sticking to this idea of if you have 3 producers wanting to go to 4, you can see what you're wanting to do to accomplish from a production standpoint, but then how are you also kind of cross-referencing that with your financials to make that decision and say, okay, now's the time to do it.

But I think, I think you got to kind of have to start with the monetary side of things, right? Like wanting to go from 75 autos to 100 autos, like your example. My question would be like, why is that the number? How did you arrive at wanting to get to 100 autos? So what we typically do is we set a goal for scorecard, you know, in March, and then we kind of work the numbers backwards from there. All right, where were we at this year? You know, what's my scorecard goal next year? What do we have to do to fill that gap? And then if that, you know, equals increasing auto production from 75 to 100, that's now the goal. Right, from a production standpoint.

Yep.

As far as like knowing when is the right time to, you know, bring that extra salesperson on or if what it, what impact it's gonna have on my bottom line, that's where I go to the forecasting platform because that thing specifically will tell me, all right, currently we're projected to have net profits of, you know, $20,000 a month. If we bring that extra person on, it's going to decrease the net profits initially, you know, by let's say $4,000 a month. But then what you can see over time is that reduction in net profits diminishes as that person starts producing, you know, renewals start stacking. And ultimately after 18 months, that person is, you know, already broken even on the investment of that new team member. Does that make sense?

Yeah, that does make sense. Let me ask you a couple of specifics. So for everybody on here, Chris, I see your question. I'll definitely make sure I ask him about budgeting for tax liability in just a couple seconds. And anybody else, you have questions like what Chris just put in the chat, do that, and then I'll make sure we hit those in just a second. I want to ask you a specific question around compensation for your team. So give us some ideas and some ranges for maybe account managers, uh, service, and then also sales, and a little bit about, you know, kind of high level around, uh, compensation and what a typical, you know, first-year salesperson who is doing well— let's just say they're hitting targets, right? They're not some superstar, but they're hitting your targets, doing exactly what you want them to do— what does that look like, uh, for them? I know people want to always want to, to hear kind of ideas around compensation.

Yeah, for sure. Um, you know what's— what's a lot of people think is, I guess, mind-blowing, is when I first opened, um, my starting salary for a team member was $24,000 a year. Um, and the agents would ask me all the time, how do you get people on, on board for that low of a base salary? And I, I just looked at them, I said, well, Who wouldn't want to work for this guy, right?

But no doubt.

I mean, you have to— one of the things I've always been really big on is culture, right? And letting the people that, you know, work for me know how much I appreciate them being a part of the success of the agency. Prior to insurance, my background was in restaurants, and I kind of take a little bit from there knowing like the most important position in a restaurant is your server, right? It's not the manager, it's not the cook, it's a server. Because the server is the only person that interacts with every customer that comes in, right? That, that patron's not going to see the chef, they're not going to see the manager. Something goes wrong, probably, right? And that's kind of the way I've always approached this business, is I want to basically be a cheerleader for my team and give them all the accolades Um, which I guess I should throw that out there now, like the success we've had as an agency is far less to do with me and way more to do with them. Um, but then just kind of breed a culture of positivity and make, make a, a fun environment that people wanna work at, which sounds kind of like idealistic, but then you have to back it up, right? So like one thing I do a little different than a lot of other agents is I offer full benefits, right? We've got a 401(k). Health insurance, dental, group life. Everybody gets a gym membership. Um, really letting them know, like, yeah, that maybe the salary is not as high as, you know, if you went to go work at Fifth Third Bank. Um, but I'm gonna back up.

How much is that costing you, Isaac?

The benefits?

Mhm.

Yeah.

What does that look like? I know somebody's wanting to know that.

Roughly, I mean, the 401k is about $2,000 a year, um, just for the fees. Um, health insurance is roughly $8,400 a year. Uh, you know, so I would say, what, maybe like $15,000 a year, something like that.

Yep.

Okay.

Yep, that makes sense. How many people do you have utilizing, uh, utilize— utilizing the health insurance? That you offer?

So currently just two, um, but my new guy Jake, once he hits 90 days, he's going to hop on board. And then I've got a girl starting Monday, uh, after her 90 days, her plan is to hop on board as well. So it roughly cost me $700 an employee per month for the health insurance.

Okay, okay.

But it works out given, you know, where they start out salary-wise, right? That makes sense. Yeah, back that up. I have a very aggressive compensation structure where, you know, if they're hitting the expected production requirements, they should easily double that salary. Um, you know, people that weren't doubled, so.

Gotcha. So is it safe to say someone, um, does what those expectations that you laid out in a year, they're going to be somewhere in the $50,000 to $60,000 range per team member is kind of their total compensation range, and plus they've got a full suite of benefits. Is that fair?

Yeah, absolutely fair.

Yeah. Okay, good. Let me ask around, and feel free to share or however much you're comfortable with, but owner's compensation. There's a lot of different places that I don't know what entity you are, so there's this idea of are you an S corp, um, or you're a sole prop, etc.? Do you pay yourself a salary? How much do you pay yourself a salary? You know, there's all these different opinions of, of that. And then, you know, you mentioned earlier about, hey, when my operating account gets above, uh, 2, 2 months or so, I'm gonna, you know, give Daddy a little bit more of a distribution there. You know, what does that look like, um, for you in terms of kind of your overall compensation? And how do you, how do you look at that? And I'm just asking this question because I just think these are the things that we all think about, but we don't ask and we don't talk, you know, we talk one to one. But, you know, people are— it's almost like there's— it's behind the curtain a little bit. And I wanted to be able to kind of share that. So you don't have to necessarily share numbers, but maybe just your approach to it.

Yeah, I mean, I'll share numbers. So I, I'm an S corp, right? So I have a— what do they call it? It has to be a fair or reasonable salary. So I pay myself $65,000 a year. Right. That's my salary. Now, out of that, 15% of it is going into the Roth 401(k) I set up for the team. Right. It's also a benefit for me, you know, selfishly, not just for them. And then basically, yeah, once, once the operating account has enough to cover 2 months of expenses, I'll typically take a withdrawal of, you know, $10,000 out and just put that into a money market. And it just kind of sits there, right? Like, you know, um, personally, my wife and I are looking to buy a new house this year, which the market in Dunedin is absolutely out of control. Uh, working on saving up for, for that. Um, but yeah, I mean, that's kind of how I— I don't have a set number that I pay myself each year other than the salary, basically. There's consistent withdrawals pretty much every month because we're, you know, we've got enough cash flow to cover the payroll for 2 months pretty much every month.

So yeah, makes sense. Okay, that's good. Let's talk about set aside for budgeting for taxes, right? So what does that look like for you? What's your cadence and your rhythm for making sure that you know, the IRS doesn't come knocking, or if they do, you're good.

Well, I mean, in all honesty, I outsource that, right? Like, I have people that tell me at the end of the year what we're forecasting to have a tax— like, what the tax liability is going to look like for next year, right? And then we just split that by 4 and I pay quarterly taxes. And then I usually have to pay a little bit more at the end of the year in addition to what we paid. Um, but that part's, you know, pretty straightforward. Is that what you're referring to, like just how I pay those?

Yeah, yeah. And, um, do you, uh, some people, uh, are familiar with, uh, Profit First or use some version of it. Do you, do you have multiple accounts or do you, are you really operating pretty much all the financials out of one account? What's your thoughts on that?

Uh, no, so I've got operating account for Isaac R. Stusso Insurance Agency, Inc., right? And then we've also got the mortgage brokerage. There's an account set up for that. And then we've got, you know, I've got separate credit cards for the business and myself. And then, you know, I've got the money market account that's in my personal name on my checking account. So I mean, there's probably, probably like 5 or 6 different deposit accounts and then, you know, only like 4 credit cards. Okay.

Okay. Gotcha. Let's talk about marketing. You mentioned marketing a couple of times. I think for most people outside of your team and the investment that you have in your employees and your salary for that matter, Marketing is one of the biggest percentages, um, that you make the investment in. Uh, Chris, when we did his webinar, uh, last time, he really dove into some of the— his marketing, his approach to the marketing numbers, etc. What about you? Uh, what has been your approach to marketing? What percentage of revenue do you invest in marketing? Uh, what does that look like?

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Uh, Well, I believe I've allocated 20% of our overall budget to marketing, right? So like I try to keep employee expenses at around 50%, um, marketing at 20%, um, and I look for different avenues too. So like a lot of people spend a lot of money on internet leads. Right. I try not to. Um, instead I try to find more, like, like Chris mentioned, right? We do a lot of events. You know, Dunedin's a very happening city, and this, the local city of Dunedin government does a really good job of letting business owners know about all the events throughout the year. And they even have a little booklet they give you that says like average attendance per event. And so I try to do at least one event a month, but then not just show up and, you know, give stuff away. We also typically the events are to benefit some kind of an organization, right? So we put a sign-up sheet. We say, hey, if you sign up for a quote, we're also going to donate an extra $10 to the Dunedin Scottish Arts Foundation. And so we get a lot of people that are like, yeah, I'd love to do that. And so we usually get anywhere from 25 to 30 names, um, and then we call on those the next week after the event, typically on a weekend. Uh, we convert about 30% of them, so pretty healthy return. It typically pays for the event and then some. Um, and it's good networking with other business owners too, like the other sponsors, right? Because that's just me. Um, and so we get a lot of good traction on the commercial side of things too, just from those events by talking with the business owners. And then I'm always looking for new ways to market. So I guess I split it into two areas, right? Marketing and branding. So like I have, I think, 7 bus shelters that have my poster on them and they get rotated actually throughout Pinellas County. Do I do that because I think someone's going to see that bus shelter and then call my office? No, I do that because it's like direct mail, right? You put this beard in front of enough faces enough times. At some point they're going to think about insurance. They're going to be like, let me call that guy with the immaculate beard that I see all over Dunedin. And it— I think that's how that works. So that's like the branding side of things, whereas marketing is like, I look at the events as actual marketing. We're going out trying to actually grab leads to call on. Does that answer your question?

It does. Yeah. And I'll share just for everyone a little bit about around that, about how I kind of see it. I would call What he's saying, marketing, I refer to it as direct response. So you're able to get a specific number of how many leads did we get. So many of you, if you buy internet leads as an example, or have different vendors that you get, you can say we were spending $10 per, $15 per X number of leads. And quick question on that and then I'll continue on. Do you know generally what of the money that you spend in marketing overall what percentage goes to branding efforts versus what I'm calling direct response?

I can double-check that. Yeah.

While you do that, I'll share with people.

If you think about—

this was helpful for me because I'm not very smart, so I needed an analogy to help me. If you think about, I don't have one of these shirts. I don't know what the big deal is, but Supreme. Have you guys seen Supreme shirts? It's a big deal. If you got a t-shirt and it all of a sudden has Supreme on it, then it's a $400 shirt or whatever. I'm sure Chris, both Ferretti and Chris Jones probably have some Supreme gear, but they can charge because of the branding power, they can charge $400. And so what someone shared with me, actually one of my coaches shared with me is that Initially, early on in a business lifecycle, you're going to see 80, 90% of the effort, maybe even in some cases 100% of the marketing budget is going to be allocated to direct response because you got to be able to get leads so you can convert them. And then over time, as the business matures, you begin to see that go a lot closer to 70/30, 60/40, 50/50, etc. So if you think about like a bigger company, they're going to be— they're not doing direct response, they're going to be doing a lot more branding focus. And someone like Warren Buffett is going to focus on companies that have a really, really strong brand. And so that was helpful for me around marketing and branding and direct response. What does that look like for you, Isaac? Were you able to find that?

Yes, I think currently it's about— it's honestly about 50/50, right? Because I would say, okay, yeah, pretty heavily on Like search engine optimization, banner ads, you know, trying to get as many clicks to the microsite as humanly possible, getting Google reviews. So it's about 50/50, maybe, maybe, you know, a little heavier on the direct side if, you know, you consider what I'm paying for some of these events. I just sponsored a golf tournament last week. Is $5,000 to sponsor the tournament, right? So that's a pretty heavy expense for that month.

Yeah.

But yeah, it's probably— I would say it's pretty close to 50/50, if not a little bit more heavily on the, you know, direct side.

Let me ask you this. Um, Chris talked about this, um, at his webinar too, but I don't think I'd ask this question this way. Uh, let's say that you've got, uh, someone who's worked for you and they're gonna go and start their agency. Okay, so I'm just asking this question in the context of someone who's within their first 12 months, where would you, and where would you, um, recommend that they invest early on that first year or so in marketing, just kind of generally speaking? And then contrast that with someone, say it's at year 10, you know, has a really mature business, mature team. What do you see that the contrast of those two situations like for the business owner regarding their marketing?

I don't know that it depends on how long you've been an agent. I think it more depends on what you're trying to accomplish. So like when I first opened, I was very heavily invested and involved in these events, right? Because I— my office is in Dunedin, but I live about 45 minutes north, right? So my goal was to mix it up with the locals here, you know, actually meet people, shake hands, get my name out there. I think, I don't think you can spend enough money on search engine optimization and Google reviews. Like, if you're not paying your team to get you Google reviews, you're doing yourself a disservice. It's pretty easy. We just have like a little template in our Outlook. You have a good interaction with someone, you just say, hey, selfishly, I'm going to send you a link. If you can leave us a Google review, it's the best form of marketing I've ever seen. Um, and I think in a little over 3 and a half years, we were up over 145-star reviews. Um, and I was thinking about that in the car today, you know, like, I think that's where I would put money first and foremost. Um, because if you, if you want anything, Brad, right, you want shoes, you want, you know, something to eat, you know, someone to fix your car, you're going to Google it. Yep. Right. And the first thing you're gonna do is look at who's got the, the highest rating. And once you find 3 people with 5-star ratings, you say, all right, well, who has the most reviews, right? Because that person's going to be, you know, more credible based on the amount of reviews they have. Um, so I think first and foremost, I guess with either scenario, I would say you need to make sure you're really capitalizing on the Google and SEO market. Um, as a newer agent, I guess I would say events would be a big thing, right? Because The amount of support you get from the business owners you meet at these events, not just from a, you know, a prospect point of view, but really helping you, introducing you to the people you should know in the community, right? I think events are a really good way to go. Plus the conversion rate on events, you know, we average 30%, right? That's way better than 5% on internet leads, in my opinion.

Yeah, no question. Michael asked a good question. Do you track ROI on SEO efforts?

Nope.

Good question, Michael. Yep.

Sorry, I don't have a great answer, Mike.

Well, no, it's the, the, the great answer is the honest answer. That's, all right, let me transition. I want to ask you about your role. I want to ask you about your role and, and what a typical, maybe a typical day or a typical week looks like for you. So maybe what are the, top 3 to 5 things that you spend time doing in the office that only you can uniquely do? I've actually had conversations with several people this week about this very thing. And I think that you being able to— you as in all of us as business owners— being able to focus on what are the things that we need to be focused on to be able to grow the business. What does that look like for you?

Keep in mind, I've been doing this a little over 3.5 years, so I'm just now at the point in my career where I am easing out of actually doing production, right? First 2 years, I was the rock star, basically. So it's kind of a good question because I'm in the transition period where I'm trying to get out of that production role and focus more heavily on supporting the team, right? Like, um, finding different online trainings they can use. Like, we just signed up for the Team Member Trainer deal, uh, which so far has been awesome. We tried a couple other ones the last year. Um, also role-playing with them, um, being available for, you know, those situations that come up that maybe they're not comfortable handling just yet and trying to help walk them through that. And then just recently set up reports in eCRM where I can actually look at how they're logging the opportunities that they're working, right? Because like eCRM is a great tool, but it's— I think Chris mentioned this on his talk, you know, eCRM is one of those things where it's like, you gotta make sure that that's what you're actually inputting. Is to get the most out of it. Um, so it's probably looking at reports, uh, training the team, looking for different, um, marketing opportunities. Although the girl I'm hiring on Monday, she's quote unquote titled the Director of Marketing, so she's going to kind of take that over for me and really be more hands-on with the social media side of things. Um, Looking at, you know, I constantly check the phone call reports and I log that on a just plain old whiteboard in the office. So everybody knows who's making the calls, you know, how many they're making. And then we track, um, like current week versus last week and then prior month versus this month on the phone calls. Um, I'm trying to think of anything else specifically that I just do.

That's good, that's helpful. What, um, I know people always want, um, to be able to ask— let's say that, uh, you've— you, you hire someone, you bring someone on in a producing role. Let's just use that one. I mean, we could certainly, uh, discuss it in a service account manager role if we needed to as well, but particularly in a sales role. Um, what are a couple things that you're looking for, uh, immediately in a salesperson whenever you're recruiting someone? That's number one. Uh, number two, what are maybe one or two tips that you have for being able to get somebody up to speed quickly? And then third part of this question, um, is what do you do whenever someone is underperforming. I mean, they're just not where they need to be, you know, they're, they're, uh, they've got it in them, uh, or so you think, but they're just not performing at that level. What are, uh, what do you do there? So 3 questions.

Yeah, so, uh, my hiring process, there's like 5 steps to it, right? So I do a phone interview first. So I guess I try to do really good job of screening people out Initially, right? So we do a phone screen. If you're terrible on the phone, that's 95% of what we do. So next, right? If, if that goes well, I have them take an assessment, the Can They Sell assessment, um, kind of look at the results of that, make sure the cognitive ability is there, make sure some of their characteristic or character traits align, um, with the position. Um, I think one thing I do that maybe some agents don't do is, um, when they come in for the in-person interview, they interview with me for like 30 to 45 minutes. and then I release them to the team, right? I'm not even a part of that interview. I just say, all right guys, here they are, you know, ask them whatever questions you're going to ask them. Um, and then we talk about it as a team and we say like, you know, what'd you think? And I always let them go first. They always want me to go first with what I think, but I get their feedback first. Um, and I think that really helps to make sure from a culture standpoint that that person's going to fit in, get along with everybody. Because then when they do come on, as far as getting them up to speed, it's not just on me, right? We've got all these online resources they can go to, but the team's bought into bringing this person on as well, so they're all available to help when I'm unavailable or, you know, golfing, to be honest, right? Um, and then as far as like an underperforming team member, I would say what I try to do is play people to their strengths. So I think if you're, if you come in and you're underperforming from like a production standpoint, the first thing I'm going to do is try and find, is there something that this person brings to the table that is valuable enough to overcome that underperformance?

Yep.

And if there is, then maybe we adjust their role. We play that person to their strengths. Right? Um, if there isn't, then it's, you know, it's time to have a conversation about like, how do you think things are going? Um, here's where I'm at, you know, how do we get you to a spot, uh, where you're performing at the level we need? Um, but also back to like the way I compensate people, given the salary that I start people out at, if they're underperforming, they're typically going to fire themselves.

Right?

It's not something that I need to do. Um, that's kind of— yeah, I guess that's kind of my approach. Does that answer what you were looking for?

Absolutely. Yeah. Uh, for everybody listening, I've got a couple more questions. So if you've got a question that you want to ask, um, Isaac, then post in the chat and I'll be sure to share. We're going to go for maybe 6 or 7 more minutes. We want to be certainly respectful of your time. Isaac, you've been super open with us, so we appreciate, um, you providing value and the growth that you've been able to have and then contributing to everybody and giving them your time today. So I appreciate it. Um, let, let's ask, uh, where do you set out? I think a lot of times we can always get kind of in a myopic one-year sprints, right? This one year, one year, one year, like what I want to do this year. Do you set longer-term goals? Do you have a, a 3-year vision, a 10-year plan? Have you, have you gone out longer, um, in your business to be able to set some bigger targets of where you want to be?

Yes, I have. Maybe not from like the traditional financial perspective. Um, I guess I've always had the kind of vision, uh, the first few years, you know, I'm, I'm right alongside the team grinding out production, you know, building up the book of business. Um, and then I see them like starting this year, right? The next 3 years is more along the lines of me phasing out of the production, really focusing on building the team up. Um, getting, you know, everybody in a spot where they're bringing value to the agency and every basically just building the machine or fine-tuning the machine, I should say. Um, and then I see that, you know, the 3 years following, more or less just having a really solid team in place, uh, that more or less organically governs itself to where I'm kind of just focused on driving business to the office for them to take care of, you know what I mean? Um, as far as like, you know, a revenue target or an income target for myself, I, I guess I'm a little untraditional in that fashion because I guess what I focused more on is I look at that as like the result of what I'm focused on, right? Like, so I want to focus on getting good people in, getting them trained up and knowledgeable and helping them build their own personal brand and align with the agency brand, right? And then the income just being a after effect. Of hitting that goal, if that makes sense.

Yep. How has, uh, how has having an understanding of financial statements and your, your financials, just having a pulse on them, how do you feel like that's benefited you personally the most?

Uh, I mean, it Understand— I guess, I don't know. Um, I guess I, I have a pretty good understanding of how money works, like, you know, how to leverage certain— I don't know. I mean, because I outsource a lot of that, right? All the financial stuff. For me, it's more of like, uh a team building exercise in the office, right? But I think it was— it probably more beneficial leading up to opening the agency than anything else, right? Because before opening, I didn't have a team of people helping with the financials, so I had to personally have an understanding of how to accumulate enough cash to fully fund myself the first year.

Yep.

Right. Um, I guess I don't have a good answer to that question, Brad. I mean, it's, it's definitely beneficial. I just don't know how to explain in what aspect.

Two things. Uh, last two questions. Culture. Chris talked a lot about, um, you know, culture is kind of like leadership in a lot of ways. It's hard to— it's sometimes hard to put your hand on it, right? I mean, we know it, we feel it whenever we're a part of it. Good or bad. What are some specific things that you do to be able to drive the culture in your agency that you want?

Lead by example, for sure. Like, you know, the team sees how I interact with customers, right? And I think to be professional doesn't mean you have to show up in a suit and tie, right? Being professional doesn't mean you have to use big, fancy, articulate words. Being professional, in my opinion, is just knowing what you're doing, knowing your product, knowing how to have a conversation with a customer and help them uncover needs they didn't know they had. Um, and so a lot of it's just leading by example, letting them know like, hey, you can be comfortable and call somebody bro, right? You don't have to say sir and ma'am every time. Um, you know, granted, read the room because there are times where you want to go sir or ma'am, I guess my vision has always been to be the Michael Scott of State Farm agents. So from a culture standpoint, like, I try to make it fun, right? Like, I feel like sometimes I annoy the team, right? They're just tired of my positivity and, you know, optimism. But they're all right there with me, right? It's a team of people that want to have fun, really enjoy the work. That's one thing I kind of look for is back to your point about like when it's time for someone to go, right? One big thing I always look for is does this person actually like the job? Yeah, because in order to be any good at what we do, you actually have to like what you're doing. You can't just show up and do it. Maybe you can. I don't think you're gonna be very good at it if you do that though. Um, and then we try to do, you know, like, uh, team building events. Like, you know, one year I just said, all right guys, get in the car. And we went to Salvation Army and we all picked out $5 suits, right? And then I hired a photographer to come and take a bunch of pictures of us in downtown Dunedin dressed like secret agents for Halloween.

That's cool.

So I think the big— yeah, I mean, that's part of having fun, letting them know I've got their back no matter what. I always tell them, like, I expect you to make mistakes. I've probably made the mistake you've made. I know how to fix it. I'll pay to fix it if that's what it costs. Just don't do it again. Right. Um, so I think trying to give them the confidence to be able to, you know, maybe get out of their comfort zone knowing that I have their back if it goes wrong, but also, you know, getting along with each other. I think the, the group interview with the team is crucial to the culture, right? Because they'll tell me right away if this person's not going to fit in with everybody else. You know, you spend more time with people you work with than anybody else, right? So no doubt about that. That's some of the things I do. But yeah, I guess mainly just try to have fun, let them know I have their back, try to get them together for, you know, team building events and then, you know, just look out for stinkers, I guess. All right.

I got one last question for those of you that are listening to this. We're excited to let everybody know that pretty soon we're going to be launching a community. So we're going to be doing all kinds of cool things with Club Capital and the podcast. And so, uh, we haven't released any of those details, but go to club.capital/podcast and put in your email, and we'll let you know more about what we're going to be doing with the community. We got some pretty cool stuff to be able to experience, do more things like this. Um, Isaac, you've been awesome today. Appreciate your time. Last question: what is the best piece of leadership advice you've ever received?

Best piece of leadership advice I've ever received. One thing sticks out. So a good friend of mine, also a State Farm agent, Edward J. Burke, um, I did my little 2-week internship in his office and, you know, he told me one thing. I don't know if this is leadership advice, but I just like it anyway. He's like, you know, the beauty of this job is there's a thousand different ways you can run a State Farm agency and not a single one of them are the same.

Yeah.

So I think, I don't know, I'll throw that out there. And then I just, anytime I talk to new agents or aspirants and they're about to open their office, I just tell them one thing. I'm like, remember one thing, have fun. Like, enjoy what you're doing and don't be afraid to be ridiculous with it. Right? Because a lot of these crazy ideas might actually pay off. I might not track the ROI specifically, but when I look at the bottom line and that operating account continues to go in the correct direction, I know I'm doing something right.

Yeah. Awesome. Awesome. All right, everyone, appreciate you all so much. Thanks for hopping on. Isaac, you were killer. Thanks, buddy.

Thanks for having me.

All right, bye everyone. Have a great day.