107. Ben goes to Business School, Master the Frameworks to Create a Successful Business

Welcome back to another episode of the Bennebergs Podcast. I'm Ben, your favorite high school dropout and founder of Collective Shift, alongside me as Bergs, your favorite MBA and COO of Collective Shift, Australia's leading crypto portfolio insights company, providing professional analysis and portfolio strategies for crypto investors. Like you, we are a unique blend of the established and the self made and we're here to break down crypto business and personal growth. But we're not here just to talk crap. We're giving you the insights you need to make better investments, better good successful businesses and level up your life. And recently I went to business school. I went back to school for a week up on the Gold coast, went to Bond University for a business intensive course which is a part of the Entrepreneurs organization, which is a group Bergs and I are a part of, which is basically an entrepreneurial business group that you know, organizes different educational sessions and courses and a bunch of different stuff. But this was an opt in opportunity and I saw Bond University, I saw EO and I saw thought it let's go to school. So I went up there for a week and it was really eye opening. So I left school when I was 17, left the start of year 12. School really wasn't for me. I was running a sports, my sportswear business back then I was super busy building that. I didn't really like school. I felt it wasn't teaching me the things that I needed to build my entrepreneurial skill sets and the future I wanted to live. So I convinced my mum and dad to let me quit school and they gave me a year to build up my business and you know, path the way to be able to afford to live on my own. And they gave me 12 months to do that. Fortunately I was able to do that within 12 months so I didn't have to go back to school, thank goodness. But I always had in the back of my mind that like, you know, business school, learning, entrepreneurship was just like, there was a lot of crap. I was just like how can you be taught entrepreneurship? Like how is it even a thing? Like it's just a thing that you develop. It's a, it's a, it's a, it's a strategy, it's a, it's a work ethic, it's just, you know, you're kind of born with it and you know, going to Bond University and doing this course really opened up my mind to the theory side behind business. Like a lot of the gut feels that I've had over the last, you know, 10 years of building businesses, the gut feels, the, the intuition, you know, things that I just believed that was the right path to go down actually had this theoretical framework behind it to explain why that decision or why that path was correct. And that was really eye opening to go, oh, there's actually like this other side here where you can, you can actually attribute frameworks and practical strategies to develop.

Business strategy. And that was, you know, really eye opening. So yeah, over the course this week we had to develop and learn what felt like hundreds of different theoretical frameworks. The professor, professor had studied a number of generational, multi generational businesses. So he's basically studying a range of different businesses that you know, had grown over a number of years with families being passed down from generations. And what were the common denominators? How did they go about it? How do they build these businesses? And at the end of the week we had to deliver and create a personal plan of our life plan in business. And I guess the main takeaway for me for the week was that and what they'll try to teach was business businesses are just a vehicle. They're just a vehicle to achieve the things that you want to achieve in life. The business that you're in now may not be the, you know, the forever business and maybe the forever business, but you yourself, your family, you are always going to be in business. That's the way you do life. So how do you use business to achieve the life long goals that you want to achieve? And that idea of that being a vehicle and delivering the things that you want to create in life was, was a great different perspective and made me think about, well, what do I want in life and what are the things that I want to travel to and be able to deliver and how does business achieve that? So yeah, it was really opening. So today I'm going to walk you through my plan. But you know, it's interesting, Bergs has been through all this as an mba, you know, you know you've come through a lot of those theoretical frameworks. I think until you do it burgs it does really make sense.

A lot of people think it's like I don't need it, I don't need a theory, I just need the work experience. But it really helps to shape your mind, frame up situations, gives you a framework to guide you and make decisions and help think about things in certain ways. And let's be honest mate, you and I talk and you're like this guy's an absolute gun. I want to be a lot More like him. I've got to go to school, he went to uni. But honestly, like during, during your course, like every day you would call me up because you were like three hours ahead of me. I was in Perth and you'd be like, bro, we had this guy and he talked about this with his business and his family and how he thinks this way and there's this framework and oh, it's just so good. And then the next day you're like, oh, we can do this and we can apply it to our business. And that's really the best way to learn through experience, through business cases. Having people talk to you, being able to question them, applying frameworks and research to your situation really gives you a well rounded view.

Yeah, he's spot on. And like I've always, I've always really.

You know, respected the way you tackle problems. You, you come at problems with a very strategic framework, right? You, you've got this theoretical knowledge and practical knowledge, but you've got these theoretical frameworks and case studies that you've seen before that you approach different things.

In a way that is methodical and logical. Right. So for example, you know, more recently we've had to made some, you know, we've had to restructure the business. We're sort of going in a different direction. Strategizing was a number of frameworks that you came with and said, right, well these are the things we need to do. We need to create this matrix, we need to look at this model, we need to answer these questions and we're going to come up with an answer, right? Versus what I would have done without that knowledge would have been a completely different strategy. It would have been more intuition based gut feel thoughts, you know, like getting on a piece of paper and maybe just going and doing it and then just figuring out later and iterating. So I think for me like as a business owner and like a, a very, I'd say personal growth driven person who I always want to get better. I feel as though if you can add that theoretical strategy with the practical together, like you've got fucking God mode. Absolutely.

And could you imagine if we didn't have that knowledge and we tried to do what we did and what this was, was creating a new strategy for our business and we both went away and were like, okay, what are the core activities? What are the folks of the business? Brought that together. But then where do you go from there? And what we ended up doing was taking those core activities, creating a skills matrix and putting those core activities against the resources and people that we have in the business and then working it out from there. And that was kind of the starting point. And then going down methodically next, next, next, next. And if we didn't have that knowledge, mate, where would we end up? It'd be kind of gut feel, intuition, hoping for the best. Whereas this is, it doesn't make the decision for you, but it guides you to a better decision.

Yeah, 100%. So yeah, I'm going to walk you through a little bit of my, my, my plan that I created. So at the end of this week, we had to present the rest of the 20 people doing the course, our plan. And it was interesting for me because I was the youngest there by far and a lot of the other business owners that were there had families and they had, you know, multigenerational businesses and a lot of the businesses there were like absolutely crushing it. Like, I really learned a lot from, from a lot of these other business owners. So, you know, one of the, one of the first frameworks we learned, or the theory is not framework, it was a theory was the idea of doing gets in the way of the thinking. And I think for so many entrepreneurs this is a big problem. This was like my opening statement of my plan that for me, like, I don't necessarily think, I don't overthink, you know, I'll just, I'll see something, I'll just go do it, right? Like, I'll think about a new idea or like and you know, Burges will test this, I'll see the new shiny object and it's like, yeah, that sounds amazing. Let's fucking barrel into it. Let's go do that. And without that thought process and without that thinking, you, I tend to anyway take on too much, do too many things half ass rather than doing like one or two things really, really well. So that was my like over. And this was a theory, right? This was, this is a, this is a thing that a lot of entrepreneurs get in the trap of. On the, on the flip side, you know, one of the theories that we learned was being in prime. You know, businesses need to be in prime now Prime. If you think about like a cycle, you know, starting from the bottom and moving up like a, like a chart, right? Like a bitcoin chart. Going up to the right prime is like that sort of top 75%. You know, it's sort of like the going up to the peak. That prime position is basically an explanation of where businesses need to be in prime. Represents the entrepreneurial.

I Guess ideation of a business. When businesses are entrepreneurial, which means that they are trying new things, they're testing new things, they're pushing the boundaries, they're breaking down barriers, they're pushing the business forward. That is when businesses are in their prime and their maximum growth, when businesses start to plateau and die off, is when they get to non. They're not entrepreneurial enough. They get too corporate. There's too much paperwork, you're talking subcommittees. There's things don't get pushed along. There's too many hands in the pie. So like it's a mix of getting in the prime but also not, not doing, not overdoing, without doing the thinking. I think that's where a lot of these theories came in to allow you to get the right strategy, which we've done recently. Get the right strategy, Spend a couple of weeks or a few weeks getting the right strategy and then executing.

Absolutely. And if you think of it like maybe a quadratic graph or a normal distribution where you're on the way up, when you're at that peak as a company, that is when you are your most vulnerable. And if you don't have a growth strategy, if you're not going into new markets, if you're not doing a market penetration strategy, if you don't have new products, new extension, all those entrepreneurial endeavors to take you to the next level, you are on the way down because you're fighting in a red ocean and you're not going to win and you don't have a strategy to get to that next point. And that's where you need entrepreneurs. And it's so funny you say, Ben, that doing gets the way of thinking on the opposite thinking gets in the way of. Yeah, I'll overanalyze the situation. And it's funny. Like, imagine like our team's running a race. Like we're at. We're on a track. Okay. We're at the start line and we're all talking about, like, how far we're going to run, what the race is, what we're going to do. And you're like, yeah, cool. When we turn around and you're ready at the 500 meter mark and we're still talking about it and it's like the balance between the two, we don't even get going and you're already way ahead.

But, but I think that's. And that's how, like as, as business partners, that's how we work well. Right. Like me and the company, I'm. My job as the Founder and the entrepreneur is just to think big, go hard and just try and make shit happen. Berg's role in the company CEO is the thinking, it's the strategy, it's bringing everyone together, it's making sure we do things efficiently and productively, right? So yes, I might be the 500 meter mark, but I might be running the wrong way, right? Berg got a map out the right like angle of the track and where you need to be at what point to maintain the stamina, to make sure you get to the end.

You know it's so funny where if it wasn't for you, we'd be a lot slower pace and wouldn't do the majority of things. And if it wasn't for me, you'd probably be in the wrong direction. Company be burnt down like, no one to know what's going on. So it works really, really well.

You need the, the horse and cart mate.

That's what you need. That's it.

So, so the next part which was a real big sort of framework and theory was this idea of church and state. If you think about church and state being, you know, you think about a line in the middle and above the line is the church and below the line is the state. The state, if you think about the state is like, you know, the, the business, it's the activities that you're doing. The state generates the, the value, it generates the money. That's the economy, right? It's, it's, let's say collective shift for me is below that's the state and above the state above that line is the church. The church is you, the church is the, the, the assets, it's the, it's the time, it's the, it's the resources that you have personally. And the idea of the church and state as an individual that owns a business or if you're in business is to move the value from the state into the church. So you're creating the value, you're creating everything down below and you're pushing up for you to live in the church. And you think about, you know, you know, a multi generational family business. They're going to have a lot of businesses that feed up into the church which feeds the family, right? They have, they have property, they've got different, you know, investment portfolios, they've got a family office, there's a lot going on. So the idea here is, and for me what resonated was like business is the vehicle, that's the state. What is that giving to you in the church to build the life that you want, right. And for me, that really resonated because I didn't, I wasn't really looking out for the church, right. I wasn't really thinking about what was coming up. To me it was more just like, how do we build the state? How do we build the business? Business, business. But over time, like, you're going to have a family, you're going to have kids, you're going to have a future retirement, like other assets diversification. What are you giving to the church to feed that? And you know, because I think you've done that really well, like, you know, of your course, of your, like investing in the career. Like you've done a lot to build your church. Like you've got a really stable, good foundation in your church, which has been a big priority for you.

And isn't it interesting where as business owners, it's always the business, what does the business need? How do I grow it? How do I succeed? When you step away and you're like, why am I doing this? What is it doing for me? Why am I sacrificing the majority of my time to build this thing? How does that improve my life? And also how fast do I get to that better stage of my life? That's when you really start to think and start to structure the business and put it to work for you, for the life that you want to live.

Spot on. Spot on. So that was sort of the church in the state, the businesses of vehicles I spoke about.

The next one was plan for a plan. And this was, you know, this is another theory. This is back to doing gets in the way of the thinking. Plan for a plan. One of the common denominators through a lot of most successful businesses is that these business owners plan for a plan, meaning that they just, they, they over plan. And we had one of the founders of Stone and Wood come in the, the, the brewery company that recently exited for hundreds of millions of dollars. The founder sort of came in and told the story about, you know, them and their planning and their, and you know, their rigorous, detailed planning in how they built the business, their financial models, how they were going to exit the business, who they were going to exit to. These guys spent so much time planning and making sure that they were so rigorous in ensuring that their business model was appropriate and they were making the money they wanted to make. And that really stood out for me as like, we have good plans but we, you know, around the certain restructure we did recently burges like a fillers. Oh, we we really nailed that. We spent a lot of time planning for that and now we've come out the other end with a much better profitability sort of percentage. You know, you know, runways looking fantastic and the business obviously hasn't been better, you know, since, since we've made a lot of those restructuring changes. So that planning is paramount and the.

Staff are fired up. Everyone's just firing on all cylinders. We're delivering, everyone's happy. It really, really worked. And we even came back and said, well, us, what do we want out of the business? Like, what does it look like? What would it look like during a bull run? What would it look like if we cash flow the business? What would the terms we would both need if we were to exit the business to sell a business? What would it mean for the staff? How would they be looked after and protected? And we wrote all of this down together and I was genuinely surprised at the alignment that we had.

Yeah, so that was another one, bringing everyone into the tent. This is another theory. So like when building a business rather than just having like you know, a guy at the top or gal at the top just making all the decisions and you know, just going, you know, parking orders, you know, the way we built built collective shift. And this is one of these gut feel things, right. I've always done this, but I didn't realize it was a sort of a theory around like why it works. And it sort of dumbed down this idea of like bringing everyone into the tent. So the tent is your business and you invite the people around you, living with you in this business into the tent to make the decisions. Right? So it's like bringing everyone into like that idea of, you know, having.

Stewards, stewardship in your business, like these are stewards in your business pushing the business forward, representing you. And they are also co owners. And I've always had that mentality around like, you know, you know, we're doing this together. But to hear like that is a, that's a genuine.

Sort of issue denominator. Yeah, it's, it was really cool.

So I hear that a lot. So Ben's in EO and he's at the founder level level. I'm at the key executive personnel level. So C Suite or gm, that kind of thing. This is a very common thing where the owners will not share with the GMs or C suite specific things around financials. So they won't, they'll only get a certain picture. These are the sales you need. They don't know where the money's going. They don't know things like a labor efficiency ratio, what's actually going into it. They've only got their small part of the business. They don't have the bigger picture. And this is a common gripe among key executive personnel. And he's like, I don't know what I'm working towards. There's other things going on I don't have. The full picture is the owner's asking me to do this and I don't understand why in the totality of the business and it really just fails to create alignment and it fails to have buy in from that person that you are entrusting to execute for you. And by sharing that, you actually give them the broader picture and enable them to do more and actually succeed.

Yeah. And they're more excited because it's like, you know, it's a, it's a co creation. It's not just like you're cogging the wheel.

It's both of us, well, all of us, our team working against a challenge. We're not hiding things from them and they have way more buy in. You just say, hey, this is what we want to achieve. We need help. Here's everything that's on the table. Let's go.

Yeah.

Yeah, yeah. And so that kind of leads into the next framework which is, this is what Ross from Stone and Wood really made it clear was this rigorous financial framework. So you know, they spent so much time on their financial model to ensure that they were, they were meeting the, the profitability margins they wanted to. And this, this sort of merged with another framework or another theory called the agency, Agency costs or agency theory. And agency theory is just this idea of, you know, the, the operational cost of the business. So the agency theory is like the.

The, the fat or the, the, the opportunity to trim operational costs to increase profitability, including principal costs. Meaning, you know, you as the founder, like what, what are the, what are the things that you're doing that are costing the business money and time? Like are you still doing emails and are you still doing like posting on social media or are you like what are those things that is costing the business time? Because you're not doing the heavy hitting strategic thinking.

In the business. We'll just be in this before the podcast, like yesterday I had a full day really deep diving into some of the key areas, the business that needed strategic thinking. I haven't had that time in a long time. But that's the most important thing you should be doing. So the principal cost of you not doing that, what is the cost of you not doing the most important things in the business. What's probably not going to push the business forward because you're too far in the weeds.

That's exactly right. And Naval has a great post on this. Principal is an owner and an agent is employee. A principal's incentives are different than an agent's incentives. And if you can work on incentives, don't work on anything else.

And when you do deals, it's better to have the same incentives.

Yeah.

And that's where you start to move like your principal thinking to those agents. And the agents start to think like a principal when those incentives align.

Yeah. And that's, that's exactly what we've got in our business. I believe everyone, everyone's acting like that.

Exactly right. It's the principal age of problem. You see it everywhere. And it's what I described just before, where the principals only want to share a certain amount. They think in a certain way. But you need to let your employees into your head so they understand how you're thinking. And the way it's described to us in EO is you're climbing the Himalayas, you're going up a mountain. You get to choose the team that goes with you. And when you go up that mountain, you can't sprint up that mountain. You have to make sure your team is with you. They understand what's going on and they're very close by. And you proceed together. Otherwise you will fail and you will die.

Yeah, you're all, yeah, yeah, that's it.

This one was opportunity in the cat in chaos. There's opportunity in chaos. So like, this is really, this really resonated me with, with crypto. Right. Like there's a lot of, lot of chaos in crypto. But that's where the opportunity lies because most people run from chaos. Most people like you know, steady, non volatile, easy markets, you know, boring businesses, which, there's nothing wrong with that. But there's a huge opportunity in chaos where you can get ahead of a big wave of a revolution, which I believe is crypto. And if you can ride that wave, you've got massive growth. And that's what Stone and would achieve. They were early in the craft, craft beer and brewing before that was even a thing. They were there, ready to go. And as soon as that, that sort of wave hit, that was just like they just wrote it the whole way up.

And the other example that you gave was, I think it was medical marijuana. Space. Right. Cbd, all that. It's not really decriminalized in Australia yet, but it has been everywhere else. You got dispensaries, so these people are investing in it, they're getting the best crops, they're scaling up and they're going to distribute. I think it was Australia, the market they were looking at. And you spot on where crypto is bloody hard. It is not easy. So we've got opportunity because there's chaos. You go in there, you don't understand, you get ripped off by an influencer, you lose your crypto, you invest in the wrong thing. It's all taxes, mental. It's all too hard. That's where we come along and we see that opportunity and we provide clarity to people and that's our value proposition.

Yeah, yeah. Bang on. Last couple here was affordable loss. So rather than thinking about how much money you want to make, what are you willing to lose? What. And that is like, that was an interesting one. Like, what, what, what are you able to lose to invest into your business? Right. So that really resonated with me because I was like, well, you know, in our space, we're really investing heavily into our business in this bear market, what are we willing to lose to build the business that we want to have ready for the future? And that kind of flipped our thinking a lot with my thinking anyway, which then got us into the rigorous financial frameworks, into the restructure to allow us to invest in areas that were really winning for us, rather than investing in areas that were just sort of like not really doing much and was just overspending. So I really like that reframing, it's.

A simple one as well and it just works so well. Where you go from we can't do that to problem solving.

Yeah.

And a lot of the time you'll see this in business where it's like, if I say, ben, we need a Ferrari, you're like, off, we can't afford that. Whereas if I'm like, ben, how can we get a Ferrari?

Yeah.

Now you start thinking going, all right, it just reframes the instantly.

Yeah. And the last one, there's a few more. But the last one that really stuck with me was.

The resource based view or your superpowers. Like, what are the things that you do that other people can't that make you who you are and that bundled together is your competitive advantage, you know, so for us, you know, we've got a range of different things from like our world class crypto, quality, content, credibility through the partnerships that we have, the authority that we've been able to build, you know, all the social proof, all our testimonials and our reviews from our members, our partnerships that we have with some of the world's leading crypto exchanges. And then also, like the money that we've been able to develop through our customer base that we reinvest into, you know, our own dashboard and content and our media channels. Like, we've got a lot of things that make us who we are. So doubling down on that. And this was another thing that we went into this book, we went in and we were like, what actually is our business? What how do we make money? What makes us who we are? Which then allowed us to create a flywheel which reminded us, you know, why we do what we do and why we succeed. And then we just fucked everything off that wasn't a part of that flywheel and double down on investing into that.

It was so funny. We separately created our own flywheels. So. And Ben calls you up, he's like, dude, there's this resource based beauty. And I'm like, bro, I've already made this. Like, this is like the quintessential mba. So anyone that wants to do this is called a VRYO model. V R I O. So you would have heard of something like a SWOT model, which is strength, weakness, opportunity, threats. Everyone does this in their business. But you need to grow up, kids, you need to grow up, be an adult and go from SWAT to Vario. Because in your swot it'll be like, what's great? My people, fantastic. What the fuck does that mean? And when you move to a VRYO model, it'll be like our culture, you know, our culture of feedback or innovation. Or we have this IP or we've got this, you know, patented process, whatever it may be. And once you start to list those down, and VRYO stands for valuable, rare, inimitable and organized. And you start to tick those boxes and if you take all of them, you have a sustainable competitive advantage. If you take the first three, that's an unexploited opportunity because you're not organized around it. We found a few of those in our business. And then if you don't tick the first one or the first two, you're either at competitive parity or competitive disadvantage. Google, a variety model. Do it for your business. It'll change your life.

Yeah, I remember when you first read ours, it was, yeah, it's great. And I guess that like to wrap things up is like, you know, the, the ideas of the theoretical side of business and how it's super helpful to just Turbocharge, you know, strategic thinking and making sure you're aligned and going the right direction. So.

Yeah, and also thinking long term. So not only thinking about the business and making money. That's cool. Next level, how does a business facilitate my life? So now you got to think about your life and where you want to go, but then punching out. Like you had one of the old guys come in and he said, the way I think about business is, or what I think about myself is I'm first, my family's second, sport is third, business is fourth. And you hear that, you go, what the fuck? Like, business rules my life. And then he also said, we've got x million dollars in 10 years, that's going to double. What are we going to do with all that money? Yeah, like thinking 10 years ahead, what you want your life to be and how you structure your priorities. Yeah, that was really, really eye opening to hear from an absolute killer in business. That's the way he thinks about his life.

Yeah, that, that really influenced me to, to, to rethink as well, priorities and, you know, looking after yourself so you can be the best for your business. So.

Yeah. And now, mate, now that you've been to uni, you've experienced an intensive unit over five days. How do you now think about structured business learning at a university level? And that what you did was at a master's level?

Yeah, yeah, I really enjoyed it. It was very intense. Like, I was cooked after a week, like, you know, I'm going to need some, some dexies or something next time.

It was, it was, it was, it was really good. It was, it was very eye opening. Learned a lot. It's a lot of information. Like, it was a lot crammed into this week, but a lot of it resonated. So, yeah, I'm keen to do more honestly and keep leveling up. I love that stuff.

And the thing is, I finished my MBA in 2019, it's now 2023 and I'm still learning, still applying, still going back to those notes. It just, when you come across those situations, you're like, hang on, something just tweaks in your mind and you're like, I know a framework for this or I know a story about it or a business case and you go back and it just helps you to get to over that hump or get to that goal a lot faster.

Yeah, man. Yeah, it's the ultimate combination. So we'll wrap it up there. Thanks, everyone. I know that was a bit more focused towards business owners, but again, like, even if you're looking to create a business or, you know, you've got that entrepreneurial drive, or you, you know, cranny, you know, you've got a little side hustle or something. Hopefully that's been helpful and given a few tips and things that we've learned along the way. And yeah, we're happy to help. If you want to reach out to us at, you know, Baby Backberg on Twitter or @BenSimpsonAU, hit us up. But as always, thank you so much for listening. If you found this valuable, we'd love for you to share with a friend. If there's someone that you think would would find value in. This is how we try and grow the podcast each and every week. So thank you all for listening and we'll see you on the next episode. Thank you, Bugs.

Thanks, Javiers.