The Best of Scaling Up 2023

Are you thinking about how to grow your business with near and offshore staffing, but you're also wanting to make sure that it's reliable, cost effective and really well done. I think docsa talent is the way to go. Here's why. They don't just fill your jobs. They bring integrity, top talent, and a people first approach that's hard to find. I've known the people at Doxa talent for over 20 years now and I say that you can count on them. I have talent. Talk to Doxatalant and you won't be disappointed. Go to doxatalent.com Bill G Again, that's doxatalent.com BillG One more time. Docsatalant.com Bill G Check it out today. My name is Bill Gallagher, Scaling coach and host of our Scaling Up Business Podcast. We bring our show to you every week covering everything to do with your people, strategy, execution, cash, and the leadership required to level your company up. Right and survive the journey. Enjoy it even. That is what our show's about. All that and more. Scalingcoach.com all right, I'm joined now by Valerie Friedland. I know that I do a fair amount of ums and ahs, and I also know that I'm a very effective, accomplished, experienced speaker, whether it's TV or on stage. And I do fine. But I know that very often when I'm trying to formulate an idea or say something, I will interject a few ums and ahs. And yet I also have encountered people who just string them together. It just doesn't stop. And I'm like, oh, stop, stop. Just get your thought together and then speak. There's some amount of it that that seems good and we probably all have different tolerance for certain amounts of it, but that's right.

And I think also we fall back on it differently. So you know, the standard use happens to be, as I described before, these certain cognitive tasks. But sometimes people use them as discourse markers and they may overuse them in that context. So what we notice when we look at studies, some people are heavy Amers, they're called, and other people are moderate Amers, and other people are hardly ever Amherst. And that doesn't seem to correlate necessarily with how good of speakers they are. So for a great comparison, Obama was actually is a heavy ummer. He actually prefers over which is typical of men. Men use a much higher rate of uh than women, and women use a higher rate of U. So that's a little fun. Fascinating linguistic tidbit. There are lots of reasons for that, but for another day. But Trump is a very lower. So you know, you have. And Obama is prized for his eloquence and generally Trump has not been lauded for his evidence. So for his talking. So I think there's a good comparison that the correlation of ums and US doesn't necessitate. You're a good or bad speaker. So we need to kind of move away from that model and let it be more natural. But again, if you do something to success, of course that's a different story. But that's really not the typical speaker we're talking about.

No particularly great speaker, sometimes a little verbose, sometimes a little long winded. But you know, Bill Clinton was also a pretty great speaker, but also Ronald Reagan a great speaker on different sides of the political spectrum. The younger Bush, not such a good speaker on the whole, but that's right. As we delve into politics, I think there's something. There's power in language, right? As a leader, one of the key things that you have is the things that you say, the way you articulate the vision and the values and what the company is up to, the way that you express things in reality, you use language for that. And there's power in knowing how others are speaking and not discounting them so that you could fully hear them and then being able to speak in a way that's appropriate to them. And then also use language intentionally to change things up and not to be so preoccupied with yourself that you get overly obsessed with your ums and ahs and try to keep things out. And then you're in your head and you're not out there and you're not on message and being worried about like letting something come out so you don't say what you would naturally say, which might be fuck that at some, at.

Some moment, right at a meeting. And people would pay attention because that was sort of anomalous to what your usual personality was like. I think the interesting thing is if we look at research on the voice of leadership, what we find is there are some linguistic markers that correlate with those that are in leadership positions. Again, would using these make you a leader? Not necessarily, but they come out naturally from people in those positions. One, for example, is the use of certain pronouns. What we find is that leaders of companies, leaders of governments tend to use more we pronouns, more or other base pronouns. Right. They also say they or he or she rather than using I as a pronoun. It's actually less frequent in the voice in the talk of leaders because they're building teams. Their goal is to talk about us as a sort of unified community, this as a unified company. And we don't do things or I don't do things, we do things. They also know to give credit to others by saying she did this or they did this. And so when we actually study the use of pronouns of leaders compared to employees, we find that they use more other based pronouns than employees do. The other interesting correlation is voice pitch. We find that higher voice pitch tends to correlate with lower position in corporate culture than a higher voice pitch. There was actually a really interesting study that was done where they assign tasks into groups in a workplace based kind of setting. And they had studied their voice pitch prior to the test. So everybody had a baseline voice pitch. We all have an average voice pitch, which is what we typically use in our speech. Voice pitch is simply the vibration of the vocal folds and so it has air moves through them to make speech. So as they were doing the task, they were restudied for their vocal pitch. So they recorded them basically. And we can instrumentally study voice pitch by measuring it on computer with acoustic analysis sort of of waveforms. And what they found was those that adopted leadership positions during the task had lowered their voice pitch as the task went on. And those that adopted following positions, so sort of were team members, not leaders, adopted higher pitch as the task went on. So we find the same correlations with voice pitch and expert versus non expert status. Both men and women are found to lower their voice pitch as they take on the role of expert or explanation of something that they have as their knowledge base in workplace settings.

Welcome to show Cameron. Talk to us about how do we design the job, hire the person, that whole world of it if we think we need one. I just started working with a new co at one of our clients and many of our clients, as they go through rounds of financing and growth, start to get a more formal or upgrade their coo. Talk to us about that process a bit.

Yeah.

So the initial process really is to really understand yourself as the entrepreneur or the CEO. What are you really good at? What areas of the business drain you of energy and what feed you with energy? What areas of the business do you love to work on or maybe your unique ability? And then also what are the goals of your company? Are you trying to build to sell? Are you trying to build to give you more free time? Are you trying to build for cash flow? Are you trying to build a company that you love going to day to day and when you understand all of those components, then you'll know who that second in command is for you. I think we have a mutual friend, John Daly or Jack Daly. And Jack's always said, if you don't have an executive assistant, you are one. And there's some real truth to that, that before you hire a COO or a second in command, at least make sure you've got an executive assistant to get all that admin work off your plate to free up your time, so that then you're only working in closer to your unique ability. The COO really should come second to that. So the starting point is to understand yourself. The next part is to really look for somebody who matches, as you mentioned earlier, the size of your company. Right. The core kind of behavioral traits of your company and the growth phase you're going through. And then it's to look, do you have someone internal who you can actually promote and bring up through the company? That was one of the things that Vern loved about Brian and I were we were able to continue to scale the company through six doubles in size, but at some point we didn't have the internal person to promote from within. We really needed to go for that outside hire. So it's understanding when to go outside or when you could have somebody internally to promote as well.

Yeah, I think there's a lot to think about there. Very often companies either immediately go to one or the other. Oh, just everything. We don't have the right person because they're not seeing the potential in people and they're not really in people's world, on their team and understanding who's ready to step up or they are afraid to go outside and they're just looking inside and struggling to find people who aren't really ready or interested in stepping up. And they're pushing people to step into a role that they just do not want.

Yeah. And I think that's because the CEO or the board or the leadership team doesn't roll the camera ahead two or three years to really think about what's the org chart look like in three years and two years. What are we really running? And does the person that we're bringing in have the capacity to run it at that level or to scale it to that level. Often it's very tough to bring an internal in unless you have a true mvp, like a true person rising up in the ranks that really has that deep domain expertise that you don't want to lose. And they've somehow shown themselves as a really strong leader. The coo more than any other leader in the organization, needs to have strong interpersonal skills, the ability to build consensus in teams and really good foster debate and the ability to see across the organization and the ability to have not domain expertise to necessarily run an area, but at least enough domain understanding to lead a group of people that run five or six or seven different business areas with deep domain expertise versus other functional heads are often really strong at their functional area and can lead people, but they may not understand the organization as a whole.

One of the things that has served me well as a coach but less well as a CEO is I tend to see people as bigger, better than they currently think of themselves or showing up. Right. I see like, oh, I could see this person like developing in this way and that's generally great as a coach. That's really, I think a good thing to see people as a future bigger self as CEO. Sometimes I would be like, oh, you're going to be awesome as our head of operations. And then I'd sort of push people into something that they didn't want to do and weren't ready for. You're going to be awesome at this. And they'd be like, leave me alone.

Well, yeah, and you're right because partially some of it is they don't want to necessarily do that. I had somebody in our call center years ago running a team of about 80 or 90 people and I thought he would be great at moving up into the next layer in our organization. As I'm like a senior manager in the call center. And he's like, I don't even like the call center. I'm like, why are you here? He goes, I'm just doing this to pay bills. I'm like, well, what area would you like to work in? He goes, oh, if I could work in finance, accounting, I would like die and go to heaven. I'm like, oh my gosh, kill me. If I had to work in accounting, I would lose my mind. He's like, no, I actually went to school for it. I'm like, well, we've got a payroll clerk role. He goes, oh, I would love that. Get me in to go work in finance.

Yeah.

So I had something different in mind because as you pointed out, I didn't really know who he was as much. Right. I never interviewed him in the early days, so I didn't know anything about his background. And then I started to assume based on things versus really seeking to understand the person and their goals and where do they want to go and where can we see that fit. And being a COO who's strategic enough to lean out two to three years to see what the company's going to need and do we have that. And it becomes a real skill set when you go from 30 to 100 employees and then from 100 to 300. The ability to bring in outside people into the roles that you need them to be in without upsetting all the people that are currently in the company. It's a real skill to be able to do that.

All right, I'm joined now by my newer friend, Mornay Schmidt. I hear that you love and have developed appreciation for systematic, repeatable sales, like a focus on engineering consistent performance, maybe maybe back to your athlete mindset and school habits as distinct from the sales rock star. And I think with our clients and even my own experience, there have been times when I was tempted to hire that special rock star. And I have, and they have produced some results. Not always survivable, consistent or repeatable onto other people, but they would do things. And I've learned to love that more consistent. Like, let's follow the playbook, let's do the blocking attack thing and let's deliver great sales on a consistent basis. Distinction from the other.

Yeah, I think that really resonates with me. And what I tell you know, the audiences that I speak to or the clients that we work with is that you it's very, very risky to try and build a scalable business model on the back of trying to find extraordinary salespeople. Yeah, I'm not advocating at all that people shouldn't go out there and try and find the absolute best talent that they can. I'm absolutely a fan of that. But what I am saying is that if your entire success model is based on you having to find these extraordinary individuals, then you've got to realize that there's always somebody that can outspend you for the best talent. So unless you have unlimited cash, unlimited resources, those rock stars are high risk. What we also find with rock star salespeople is that using, you know, the top grading methodology, they're C players. They're often very high in competence, but lower on core value alignment because the attitude is, well, I'm amazing and I make you a ton of money. Just leave me alone. I don't need to roll practice. I don't need to be a team player because I'm making you lots of revenue. And I know this because, humbly, I was that sales guy at parts of my career. Yeah, I was the producer in a company and unfortunately also you know, a little bit of an ego. So you can't rely on that. I mean, I think irrespective of what you might think of their food, McDonald's have taught us a very valuable lesson, and that is you need extraordinary processes that can be run by ordinary people. And that's not an indictment on the people that work at McDonald's. What I mean is that if you can make your processes so extraordinary, then it means that you don't have to rely on finding the LeBron James of the world and the Kobe Bryant's of the world. You can buy good players, you can recruit good players, and the processes make them excellent. And that's really what we want to see in most scalable sales teams.

Yeah, it's that combo. I was advising a company, I mean, a lot of years ago now, and I'd been working with them for a couple years, and there'd been a lot of focus around the culture and that. And this is a professional services firm on the west coast. And at that point, they probably had 400 employees. And they hired this new guy. And I remember the CEO was concerned. He's like, God, this guy's such a rock star. And he's already producing results, but there's just something wrong with him and my team. And so we looked at the company values to see if there were any clues there. And what he came to realize as he's talking through this thing and describing him like, well, you've talked to me for a long time about how proud you are, and we've done so much work on the culture of the company and the values in action in your business. And now you've got this person who's kind of a. Who's a rock star, but he's a solo act, and that's not team. And. And you're focused around team and working together and that kind of thing. It doesn't say it exactly in the values, but that's the thing. And he. It was like a dagger. Like, it was an emotional moment. He's like. So he went back and he. He eased the guy out of the company, sent him on, you know, found the appropriate way to do it.

That's really tough because, you know, when somebody's a big producer, working them out of the business can be hard, extremely painful, especially if you're a scaling because you're holding onto that revenue generator. But it's what I tell my clients is if you put. If you have a room full of people that are healthy and you put somebody into the room, who's got the flu? Everybody else gets the flu, not the other way around.

Yeah. All right. All right. I'm joined by Nick Arellano. Now, we use a number of different tools in. When we think about stuff, we work with companies on checklists, on fundability, on saleability. We think we use the ideas of Built to Sell, Warlow's book. You know, let's. Let's design in and let's set you up so that you can exit the business, or let's set you up so that we're funding or recapping the business and you're still involved for a little while. They're both valid kinds of options, depending on where you want to go, but they could be different.

A lot of owners, even at the level that we're talking with, don't really realize that there are a lot of options like that and we'll get to it. But the opportunity to sell even a portion now.

Right.

And maintain some equity or keep a role in the business or not keep a role. There's a lot of options based on how and when you want to exit. Emphasis on the how.

What portion of your buyers are private equity versus strategic family offices, that kind of thing.

Versus it depends a little on the industry, but in a number of industries, we're getting mostly strategic buyers. But we do have a lot of interest from private equity firms. And with the private equity, oftentimes they'll own a firm already in the industry, like a platform firm. That almost makes it like a strategic acquisition. And oftentimes those ones are willing to put a lot of capital and get a lot of synergies from the transaction, which can really help to drive up the purchase price, especially as we run a competitive process. And part of what we do is get involved with those buyers on calls, I will personally get on with them to kind of vet out, okay, what is it? How does this fit with what you're doing? Right. So that we can use that as negotiation leverage and. Okay, great. I think we can push them a little bit higher as far as purchase price and structure.

Yeah, we see taking the most obvious, typical things, we have a very strong preference for sales to strategic buyers. And on the buy side, of course, we want to get as close to private equity type valuations as we can and structures for that matter, even if we're a strategic buyer. But if you're smart and you're trying to maximize it, you want to sell to a strategic type buyer at a strategic type multiple, you want to have multiple offers on the company and Have a company who's very cleanly saleable that you can step away from very easily, who's predictable, who's well run, who has good plans, regular habits. Right. Like clean cap table, clean ownership, great documented agreements and contracts. Right. All those kinds of things that can screw up or enhance a sale.

Yeah, it's a lot of the traction things and running like you'll be there. Somebody smarter than me said run it like you'll be there forever, but could sell it at any time. And having those things in place and when we see businesses that come across and are positioned like that, it really helps because what we've seen in the past, we had a couple, and there's a couple examples too. We had one up in the Midwest that because there's so much. We've had a long bull market in a number of industries. Interest rates were low. We had a lot of unsolicited offers. And that's where we just. Those that have taken the time to position their business were able to say, okay, I wasn't necessarily ready to sell yet just thinking about it, but this is a really good offer above where we might get. I think, you know, hey, I might need to keep a role because I want to work for a few more years. But this would be an attractive offer to consider and we're set up to do that. And we just had one that we finished in the spring that was just like that. And we were able to get through and accept the offer.

Tell us about that company. Tell that story.

So it was again, kind of a services company and. And it had been. This is a little bit in the. Had worked with them, but this is the construction services company up in the Midwest and had worked with them and had known of them and had started really because we go through a number of phases. Phase one was starting to do some financial planning and how much do you need? It had been in the family for 50 plus years. Dad started it. Son, 45, was running it, but not ultimately what he wanted to do for the next 20 years, but still loved a great business. And so we had. They had a number of good things in place, didn't need too much work, but we had focused on some internal things which we've already talked about. And it came that after a few months of working with him, we received an unsolicited offer from a private equity firm that had owned other entities in that space. So it was a good strategic synergistic fit and we were able to negotiate a pretty good deal for them because everything was Already in place. And he was able to say, okay, great. Because of that positioning, it's already there. I would still like to remain. I'm not ready to stop working yet. Don't play golf and want to.

There's many other hobbies. You could sail, you could ski, you could travel, you could buy an airplane.

Yeah, right. And he had some. He actually races snowmobiles, which is interesting. And so he.

That's upper Midwest very much so.

We did agree to a little bit of earn out which allowed us to push the price a little bit higher. But again, all of that was from having, as you mentioned, having those pieces in place and having the business ready allowed us to say, hey, we're totally confident that, you know what, but revenue is going to continue to grow and be higher and we're completely confident that that's going to remain even if you purchase this firm. And sure, we'll push the price a little higher, we'll take a little bit more in an earn out over the next couple years. And it was a very attractive structure for him. And that kind of ties in just a little of the other. You know, we talk about strategies that kind of minimize taxes and different things. That is a big topic for owners. And so we had some. We worked with some strategic partners and just in a nutshell, we were able to put together since he's maintaining, we sold 70% of the firm and he retained 30% for a couple years because that buyer really wanted to put money into the firm and saw a lot of opportunity there and he agreed. So there was some things that we were able to do. Then a the earn out and contingent payments delayed some of the purchase price. So that pushed taxes into a different year. The equity that he was able to retain, we were able to put in a tax advantaged vehicle. His wife had some philanthropic wishes that were important to her. So we explored like a charitable remainder trust. So she'll get a tax deduction when she donates the shares. She can continue to take income. The remainder gets donated to charity. So all that was important because we had done planning, figured out what they needed to live off of and then that remaining equity is going to grow a whole bunch. So it was great to have on a tax deferred vehicle. And a lot of these in other situations, if you get to it before you actually sell, can have a great advantage.

Especially years before Morgan Jay Ingram.

When I started off as an sdr, I wasn't the best sdr. Three months in, I had missed quota every single month. So I was on the verge of getting fired. So, so, so everything I just told you, like that I do today, like, I almost got fired. So I remember going to my VP of sales and being like, I don't really know, like if this is for me and I think that I should just move on and do something different. And I remember her asking me a question that was so important. She was like, are you giving this role a hundred percent? And I remember being like, no, like I just be transparent, like what I wasn't, I was giving like maybe 70. Right. I wasn't really giving it my all. And so I had to really think about that question and my answer. And I was like, what if I gave this a hundred percent, really documented this journey showcase people, what's going on and just made this my life for the next three to four months. And I think a lot of people just, they'll stop something but haven't really asked themselves, are they giving 100%? And that doesn't mean 100% like to burn out. I just mean, like, are you actually committed to what you're doing or are you just like going through the motions? And I was. And so once I started doing that, that's when the content and that's when my role got better because I just was able to show up more as myself. I was able to be like, hey, this is what I'm doing. Here's the cold calls that are working, here's the emails that are getting conversions. Here's like what I'm doing on social. Here's how I'm creating the content. And that led to a genuine connection with my audience because I wasn't trying to tell them something that I was not. I wasn't saying, hey, I built this million dollar sales team like, like I had done none of those things. I was just like, hey, I'm in this role day to day. I show up and make 100, 120 cold calls a day. I send out a lot of emails and it's very difficult. And I schedule meetings. Not that crazy, but I found out that by sharing that it was crazy to other people because no one else was doing it. So it allowed me to really stand out and have a completely differentiated factor. But I remember those times a lot because I always ask myself in everything I do, am I really giving this 100%? Because if I, if I'm not, that means that I'm the one who has to step it up.

Yeah, you know, I, I can think of a few people that have been on different sides of that. And the thing that I most hear is, is like our. Our first value, like our. Of our company core values is courageous authenticity. And the. You're just like, sharing, like, you're. You're getting real with people. Like, here's what I'm doing, here's what's happening. And you're not, like, pretending to be successful. It's not the faux flex. And you're just like, you know, here's what I'm doing. This part's kind of hard and this is kind of cool. And. And I think that that is. That there's real power in that because we're so used to being presented these polished images and perfected things. And. And even though courageous authenticity is one of my values, this show is inherently that also the other side, like, this angle is very flattering for me. Right. Like, these glasses really work. This microphone makes my voice sound great. You know, the camera and the lighting here are groovy. Like, I am putting my best face forward in this thing. But there's also then a willingness to be real, to speak plainly, not to be all polished up and that kind of thing. So you are going to put it forward a little bit, you know, every now and then, but a little bit of, like, behind the scenes, a little bit of reality, a little bit of frank and open and, like, not totally polished is just so powerful. Refreshing, right?

It is.

And something that you mentioned about being, like, polished.

There's my bad camera angle. I don't like that one so much.

And, and.

And the thing is, if you look at. Back at my first videos, I did not have any of that. It was literally like MacBook old. I mean, like a MacBook old pro camera was really bad. I had no mic, lighting was terrible. Looking back at those videos, I was like. I was like, oh, my gosh, let's look at the other day. I was like, what were we doing? And then also as well, it was like just the way that I spoke too, was just like, like one take. I just need to get it out there now. It's like I formulate everything now because it's just the way that I've done it. I think it's important though, what this is something I'll also share as well. When you're looking to create content or looking to sell or anything, go look at the beginning of someone's journey. So I. Eric Thomas, I followed him a lot. Gary Vaynerchuk, some of you probably know who that is and just really anyone, right? You could go back and watch the first videos and you'll laugh and be like, like it's okay. Like, like it's okay. They did not start off good. Like those videos are not, they're not that great. And so if you feel like you're intimidated or feel like overwhelmed, always go look at someone's first thing that they did and it will inspire you to go do what you need to go do.

Yeah, I, you know, I think about that, but my first show was with Bob Bloom and you know, Bob Bloom's passed on. But like the, the mic, the connection, the background, the preparation, the format of the show, I had thought about it and prepared for all kinds of things. But the difference between then and now is really significant. There's a very noticeable difference. And some of the shows in between those early shows, I'm like, oh, that's a little cringy. And you work on it over time, you level up, you get better at things, but it doesn't mean you're never done. You're never so perfect. So slick. A little bit of that being open to learn and level up at any time makes a difference. And I think it so builds the connection and credibility when we can see that it gives us permission to be real. So I'm joined now by Sally Jenkins. So we're talking a lot about team sports and competitive sports where players are facing off against each other directly. You also have some examples, Anne, from some of the kinds of sports that I've done more of. Laird Hamilton and Diana Nyad. Talk about some of those individual performers and what you learned from them.

Maybe start with Laird.

Yeah, yeah. Laird Hamilton might be the most fascinating athlete I've ever talked to. He's very eloquent about subjects like fear and risk. And one of the things that Laird really explains in the book is that that your body doesn't know what's stressing it really. Your body doesn't know whether you're having anxiety because you're in the ocean with a really big wave coming at you, or if you're having anxiety because your 16 year old daughter left with the car keys three hours ago and hasn't come home yet. Your body doesn't necessarily distinguish between those two things. Laird is very clear that you can actually train for stress. You can condition yourself to behave better under stresses and you can do it with things like heat and ice. One of the most interesting things that Laird does is he trains himself to deal with his physiological reactions to stress with ice baths and saunas. Because neurologically your body is responding in the same way that it's going to respond when you're stressed. And so Laird actually trains a lot of different types of performers with coping with neurological stresses, from NBA players to Hollywood producers, out of his home in Malibu. And I think that Laird's wisdom about fear is something that anybody can borrow from. I mean, one of the things Laird says in the book is that it's not the high performers who have the most to learn from exploring dealing with fear better. It's really the rest of us who have so much room for growth in that area. We spend a lot of time seeking comfort, and comfort is not the only thing worth seeking, is what Laird would say.

I love, love, love that, right? Like, there's a time when you want to sit on the couch, when you want to do something nice, when you want to have a glass of wine, when you want to seek some comfort. Go take care of yourself, get a massage, have a good night's sleep, right? Get the best mattress you can get. Like, you know, there's plenty of room for comfort. But if all we lived was, like, coddled and comfort, like, on the couch, then you just die of a heart attack, right?

Right.

When your fat body finally gave out. But, like, going into something, like, exposing yourself to cold water, super empowering. I swam for quite a bit in the San Francisco Bay, and. And have done the swim from Alcatraz a whole bunch of times. And. And I remember very well the first time I went in, my feet were icy. And then, though, as I waded deeper, the water got up. Finally it hit my. My. My genitals. Like, what am I. What am I gonna say, right? And that was like, whoa, that's cold. And then I'm like, oh, my God. And then. So now I'm tensing my body, and then finally, I immerse fully, and then eventually I stick my face in. But when you stick your face in cold water, in particular, you hold your breath, right? And you can't really swim well if you're holding your breath, right? You need to pause and breathe. So forcing yourself to accept the cold and breathe again is like. Is a big, like, reflexive kind of thing to train, to get used to, right? And then that translates, because after a while, then now I'm. I'm just driving across the Bay Bridge in a very comfortable car, and I look down at the water, and I know I have swum out there in the middle of everything with jellyfish and all kinds of crap, and who knows that, you know, there are definitely sharks out there. I haven't seen One. But. But. So you're out there, and sometimes I can't see anything because there's fog come in and that kind of thing. But then you know yourself as that person, and then you go to a meeting with a banker and you have some steely resolve because you're like, yeah, I was swimming out there. I know that's who I am. And I can deal with this conversation. Right. Sometimes that adapting to that stress gives you some personal power.

So Jimmy Johnson, the race car driver, you know, makes a really fascinating point. This actually doesn't wind up in the book, although I talked to him for it. But Jimmy Johnson said, look, you know, you have to condition yourself to speed. Like, if you're used to driving 60 miles an hour and you get in an indy car going 200 miles an hour, your synapses won't be able to cope.

Right.

And so it's important to subject yourself to a certain amount of conditioning for stressful situations, because as one of the neurologists that I quote in the book says, stress is nature's way of helping us rise to a moment that matters. Okay. And so it's not just that you'll be coddling yourself and you won't have much of a sense of accomplishment. Your body releases chains of incredibly helpful, you know, chemicals to help you deal with it sharpens your senses, it makes you more acute, more focused, all of these things. And so what. What Laird Hamilton would say is, we're meant to experience a certain amount of stress and a certain amount of fear and a certain amount of anxiety because it's nature's way of training resilience, and it's nature's way of helping us make decisions under pressure. Learn. Learn how to make better decisions under pressure. Manage ourselves.

Yeah, it's outstanding kinds of thinking. Like, you could take stuff from one realm and then apply it to a whole other. And you'll see those benefits show up later when you need to do something and in ways that I think are hard to predict.

Right.

Being a dad or a mom, like taking care of a child, taking care of a sick person for a period of time. Then you go put yourself in a business situation or something else, and you'll be surprised that you didn't develop some. Some capacities and some character in that moment that are so, so useful.

Yes. And like, one example that Laird Hamilton gives in the book is he says, you know, my body doesn't know whether I'm anxious because I'm in the ocean in, you know, some dicey wave conditions, or whether I'm standing in a room talking to a bunch of business people who don't respect a surfer. Again, your body doesn't necessarily know to differentiate. And so Laird's experiences in the water have helped him certainly cope with becoming a businessman, becoming an entrepreneur, sticking to stand up paddleboard surfing when everyone in the world was laughing at him and saying, oh, that's, that's a ridiculous endeavor. And now there's hundreds of millions of those things around the world.

I'm joined now again, a returning guest, a man of extraordinary accomplishment, retired Admiral Sandy Winnefeld. In our family, in other families, just figuring out what's available and where to go and what's next because they don't. I mean, some will use social workers and that kind of thing who will help navigate what's next, but a lot don't or they do a bad job of it. And you've got to know as a friend or loved one family member what's going on so that you can be an active participant in helping to figure out what's next. Once you get out of this or that, like, where do you go and how do you sustain it? Because people fall back into stuff like so quickly. One of the, you know, I said, my dad succumbed to alcoholism and mental health stuff and, but, but he also was my hero. And when I was very young and I got a little out of control my first year of college and I was drunk and high on sorts of things and my dad, I crashed a car and I nearly killed myself. And my dad, as I recovered, said, I think you need a little break and I suggest you pick a branch of service and spend a few years. I know you were going to go in the Air Force later, but maybe now is the time.

Yeah, yeah.

And, and it really saved my life because I interrupted the friend network. I got something a little that, that, that gave me more rigor at that point of maturity in my life, life that I college at that age, it was, I just was out of control. And so I went in the military and it really did, it was challenging to go in as enlisted, but it really saved my life.

Yeah. And our son was a little young for that. He was a, basically a senior in high school in spring when this happened.

Yeah.

And it was, it was, it was, it's interesting because it was easy for his brother, his older brother to be stigmatized by that. It's like, hey, I'm doing great. I'm going to go to the Naval Academy. Why can't you figure this out? And he didn't really understand what my younger son was going through. And as it evolved and my oldest son actually wrote a really compelling editorial for USA Today in which he talked about how he had been stigmatized by what his brother was going through, but that he now realizes what a warrior his younger brother was against addiction. Jonathan was fighting it as hard as he could and he was successful. He got his EMT qual. He was, you know, after 15 months, he was bright eyed and bushy tailed. He was a human again. We could talk to him and. But you know, that lure when you are, you know, freshly sort of out there and what happened to him is in order to get a part time job as an EMT in Denver, he was going to get a job with the company that does all the Denver sporting events. You know, how cool is that? You know, you go do the Denver Broncos games and turns out a lot of guys have heart attacks at Broncos games and other NFL games. And so they asked that he would get his EKG qual. So he was getting his EKG qual and walking back to where he was staying one night and ended up walking by the open air heroin market in Denver that's just out there and some guy offers it to him and you know, it's very, very hard to say no, especially when maybe you have a little anxiety about college.

Yeah, I could just a little, like, would feel good. I could. Yeah.

Yeah. Boy, it was tough. But we're doing the best we can. We try to save a life every single day. We, we are in a space where there are a lot of other organizations. We do not compete with any of these organizations that can creep into this if you're not careful. We want to raise all boats and we've had some good successes with people recognizing what we're doing. We, we were recognized as the number one charity in the drug addiction space by a company called Donor Box, which a lot of people use on their websites to, to process contributions. And we were very fortunate recently to get a very nice, generous gift from the mackenzie Scott foundation, which was totally unexpected. You know, they don't, you don't sign up for those things. They just appear. And we felt that was real validation for what we're. We have a great team and they're slugging away every day trying to save a life.

We want to keep talking about this, but as we move on, let's throw the link on, if you would. SafeProject Us is the URL, the website for the program and all of its activities. And we'll put it again at the end as well, but it'll be in the show notes and that kind of thing. So people can go looking for. I think that that is a, like, it's everywhere, all around us. And it's so multifaceted, complex, interwoven. It can happen in so many ways. It's a long, difficult journey to get past that, that and to fully navigate and escape it. It's extraordinary when people do because it's not, it's just not easy. Right?

It's not. And you know, for, for a large chunk of your audience who are business people, business executives.

Right.

It's something to ponder in terms of what you're doing to make sure your employees are as, as safe as they can be and, and, and both their environment at work, but also at home. It's hard enough to find good labor these days. You don't want to lose people to this. And there are some fairly simple things to make sure that your workplace is not stigmatized, that people understand that if they are struggling with something that it's okay to speak up, whether it's struggling with a mental health issue that could lead to this or whether it's a struggle with substance abuse actually, you know, in process and to do simple things like, you know, have some Narcan available very close, because it's very possible somebody could overdose at work. Making sure that your healthcare provider is adequately supporting people who have issues like this and making sure that they know how to talk to their families. I mean, there are a number of things that workplaces leaders can do, do to protect their, their people from this, this crisis.

So the great thing is that we do have an audience of CEOs and entrepreneurs who lead organizations with lots and lots of people on them. And even if you're not the CEO, you're an influential person, likely if you're listening to the show. So for all those people, SafeProject Get Us is a place to go and learn more. But there are things that you can do and I, at least two, no, three of my CEO family in this way. So it's deep and close. And if that's the case for us, it's the case for the people on your team and their families. Right. And like just bringing in basic things to your company can impact not only the company, but then also the people, their lives at home. And you can't afford for them to be impacted anywhere than they need to. You need your people to be sharp and available and not, not, not overwhelmed with a family crisis.

Right, true. And, and the Other thing is, is there, there are probably a lot more people in your organization that are struggling with this than you imagine. Because one of the things about addiction as, as I think you probably understand, Bill, is that there are people are very good at hiding it and very.

They can be very, very good.

Yeah.

Fully functioning addicts are, are in every workplace. And, and if they know that they're not going to be stigmatized that, that there's help out there, then, you know, they'll, there's a chance that they'll seek it. Not always, but there's a chance that they'll seek it.

So I'm joined now by Rob Volpe.

There is a chapter in the book called let's Talk About Sex. And I tell stories about times that sex or sexual related things have come up up or times that I have actually been engaged to talk to people about sex and how they use.

As a researcher.

As a personal lubricant. Yeah, as a researcher. But you end up like, you know that. I'd start that chapter talking about when I was living in New York in the late 90s, early 2000s, sex in the city was the thing. And I had those boozy brunches with my friends on Saturdays and Sundays and we would talk about sexual and all the different things that were kind of going on in our life. And again, it's about how you talk about those things.

So David and his snacking, what did you notice?

Well, that's confidential to the client. But David was a great example of just that curiosity and got me reflecting on how I asked questions and the role of empathy in those particular lives. And then I move into some stories. There's another one in the next chapter about. Because this first section is all about when empathy eludes us and what happens when you're not having empathy. And I was doing a project on bubble gum and talking to teenagers about gum chewing habits. And this was, gosh, 15 years ago now. We were up in New York, did the research, had to get down to Atlanta. I took some time, time to spend the night or see some family in the Dulles, D.C. virginia metro area and got stuck with thunderstorms and ended up having to spend the night on the floor in the airport at Dulles for the first and only time ever. And there was a realization like I used to have a lot of judgment. I'd see those people camped, you still see them today, like camped out chairs.

It does happen.

And I'm like, why aren't they with a friend or family member? Why didn't they get a hotel room. Why? You know, all the different things. And here I was. My parents only live a few miles from Dulles Airport. In theory, I could have gone home, but I didn't because I ended up getting a really early flight, but suddenly. And then had to take a sponge bath in the airport bathroom. And MacGyver. My suitcase. Things in my suitcase. Because who travels with a washcloth? Or typically I don't. Was like, how am I going to get myself clean? Because I was hitting the ground in Atlanta and going to meet the clients and going out for work. This was. I was going to work. And it was a packed full day, and I had gotten maybe three hours of sleep. I was just beyond exhausted. But I figured out how to do that and get presentable. Then I got there, and one of the three. We did three interviews that day. The last interview is the one that was memorable to me because the house that we were in for this teenager. First, the parents, the mom wouldn't let us into the house, so we had to do the interview. This is Atlanta. It's late June. So hot. Humid.

Yeah.

Warm.

Yeah. Four o' clock in Atlanta on a late June afternoon. Uncomfortable. And we're sitting outside of this townhouse complex on these. I remember they were those kind of poured concrete patio setups that they have. It was myself, the respondent, and then a couple of clients and agency folks. Finally, the parents slip off to go to dinner, and they drive off, and we're like, oh, now's our chance to get inside for some air conditioning. And so we convinced the teenager, and he was 17 or 18.

18.

He was a little bit older, but we convinced him, oh, hey, can you bring us into the house? We want to see the. He did these dance videos that he would post up on YouTube, and we wanted to see those. And this is before smartphones, so we had to go into the house and. Oh, my gosh. This was before the Hoarders TV series and before hoarding became a thing. But it was. There was a narrow pathway to get through the living room as you came in off the front door. And then there was just this smell as we rounded the bathroom and into the dining area of cat urine and fresh baked goods and other sorts of things.

That's a contrast.

Oh, yeah.

Oh, yeah.

And.

And literally, we're standing there and like. Like, you know, arms up on our shoulders, contained. And I literally voiced. I sort of saw a voce to the client. Like, touch nothing.

Yeah, yeah.

The mom had baked a cake.

A.

A.

A Betty Crocker. Moist, Deluxe, whatever sheet cake that was sitting on top of the oven, cooling. And then I saw a cockroach crawl across it. And I. It was like, oh, this is that real estate trick of, like, bake fresh cookies before your open house so that it has a warm, appealing aroma and people want to be there. And there was that, and then there was like the smell of urine and things elsewhere. And it was, it was a very uncomfortable thing. And, and, and this is an example, like, the judgment around this. We were so uncomfortable that we weren't listening to anything that he was saying. And as once the interview ended and we're there, those interviews are like two hours roughly. So by the time that was done, we leave you just like, I. What. What did we just see? Like, you're having to process the sort of quote unquote trauma, the pseudo trauma that you just been through, the shock of it and the judgment to try to get to. Like, what did he tell us about Bubblegum? I'm not really sure anymore, but I do still remember very vividly that house and all the Coca Cola. Vintage Coca Cola memorabilia, because we were in Atlanta. Tons of vintage Coke memorabilia on the walls.

And there's always a bit of gold in hell.

For sure.

Yeah, so.

So, you know, the point of it all, though, is that when you're not using empathy in your life, whether it's at work trying to grow your business or with your neighbors or your family members, you're not communicating well with other people. You're not connecting, you're not hearing them, you're not understanding them. Therefore, you cannot reach decisions with them. You know, problem solve, communicate, do the basic skills that we need to be successful.

I'm here today, joined by my mentor and friend, Verne Harnish, and we're going to get into Vern's recent insights and kind of talk through them. One of the funny or more unusual things that I do is I will change the environment when I'm doing coaching conversations. And I. A couple weeks ago, I went skiing with a CEO and I've taken CEO sailing, and we frequently take walks and that kind of thing. But we would. We'd feel like we were settled with something. We'd go, okay, let's take another run, and we'd ride the thing up, and we'd finish our conversation on the lift up, and then we'd ski down, and then we'd get back in the lift to take another run. And the CEO would be like, yeah, but what about this? Because on the way down, he'd Had a chance to synthesize things.

Right.

You can't do a lot of thinking when you're talking. I mean a little bit you sort things out out loud but. But we don't learn a whole lot when we do it. So he'd, he'd like digest it, then he'd pose a new question. We take the lift up, grapple with that for the six minutes on the way up or that kind of thing is pretty useful. Right?

You know, it's interesting. One of the very first programs I put together for CareerTrack 30 years ago was on innovation. And there really is a four step process preparation. So you do have to put in the hard work and effort. Then you need the incubation. You got to step away and let your mind do its magic. Then you get the inspiration. Everybody thinks you start with the inspiration, but there's two critical steps before and then obviously verification. You've got to go do something about it. And so yes, you've got to work hard at. And you know, one of the jokes is entrepreneurs would rather work 16 hours for themselves than 8 hours for someone else every day. And I think it's true. But at some point it quits being a joke and then that's when we begin to kick in and see if we make people much more exponential. Because the other thing is frustrating is to be putting in the hours but not getting any results. And that's the frustrating thing. I'm losing. I'm actually making less money than I did when it was just three of us working out of a spare bedroom. And so that's what we really work on fixing. And that barriers chapter gets at that with Alan Rudy, who was facing exactly the same thing at ExpressMed.

So we already talked about being bold number eight, but being willful. And we're about to come back come to soon, so let's just defer. But being willful is about asking for what you want and we're going to dig into that more. But the next one is really critical. And you talk about this endlessly and preach this and I've learned it and worked it to preach with our clients. But that is being hard to compete with by being different. That whole like how could you be usefully different? Meaningfully different?

Yeah.

And Porter was adamant about it. I mean if you're pricing the same way as everyone else, you're not different. If you're hiring the same people as everyone else, you're not different. But most importantly, if you're delivering your product or service in roughly the same way everybody else is doing it, you're not different and therefore you really don't have a strategy. So you and I can have a podcast and we should on just that topic some other time.

Time.

It's a useful thing. The places to be different. Number 11 is building a network being a force of nature, like with people surrounding you who are a force of nature. And I think about one of my earliest successes in business. I built a business for someone else, over 550 million. But I didn't build a huge network of friends and fans because I was such a joke jerk. I often use stronger language for how I was in those days, but I was such a jerk to the people around me. So arrogant. So sure, I had a small piece of the total business for this company, but the majority of the operating profit. And I lorded over people and I'm so much smarter than them. And I wasn't building at that point. Only later did I learn to build friends and supporters and allies and. And that kind of thing. It's so important to build that network.

Yeah, well. And that is the key thing that Regis McKenna taught Steve Jobs, Intel Genentech and who I cold called and asked for help back in 1983. I'm just a student at Wichita State, had a good vision, build the world's largest entrepreneur organization, which has panned out pretty well. And he said, look, I'm going to teach you what I taught Steve, which was take a piece of paper out and make at the time a list of the top 25 influencers that you can bolt on to this vision. Verne. And the bigger the names, the faster you will scale. And I think that's the essence of what Sam's talking about, is not just have a network, but have a network that wows the world that truly can influence. I still have that yellow sheet of paper I put down in 1983. Look, I was young, dumb and broke at Wichita State. I put down President Ronald Reagan. I was going to make him be the first president to utter the word entrepreneur. And we did. And Steve Jobs and Michael Dell and Inc. Magazine and Venture. And it was crazy. In 36 months, everybody on that list was on board, including the president. And we were global in 36 months. So I saw the power of making that list, which Steve Jobs did every time he needed to launch something, including itunes. He made lists of the 25 top players in the music distribution space. By the way, none of them would return his phone call. You know, the ego in that industry is huge. So he found somebody you know, the drummer for the Eagles to come over to his house, do a walk and talk. And he said, hey, do you know anybody on the list? And goes, yeah, I know that guy. And 24 months later, Steve was the king of music distribution. And he was a nobody in that space before that. So that, to me, it's one of the most important maxims that Sam articulated.

So you mentioned we talked about being willful in Sam Altman's list. But then there's also an Ink article in the Insights. Steve Jobs calling up the HP founder and asking for some spare parts at a young age. And this idea that you got to ask for what you want, what you need, or nobody's ever going to know. Right. That's a huge thing that separates doers from dreamers.

Yeah. And that's what they were pointing out, that Steve was 12 when he made that phone call to Bill Hewlett. And Bill just got such a kick out of this young kid asking that he gave him the spare parts. But more importantly, he gave him an internship. And ultimately Steve kind of cut his chops there and got a real sense of what it means to have scope and build such a significant company. And I think you need to see that, that in order often to achieve it. And so he went on to say, that is the big thing that separates, as you said, the dreamers from the doers is they make the phone call. And that really goes back to not only making the list, but figuring out how you're going to get to everybody on that list. And they are the three most important words, I think in any language. And that is, you know, please help me, you know, or you know, can you help me and be sincere about.

I want to give a shout out to my friend and mentor, author and creator of the Scaling up book, Vern Harnish and the original Rockefeller Habits. Our show would not be here without him. And then to a couple of people supporting us and getting our show out every week, Wanda Mitchell, our show producer and my assistant, our client coordinator. Our audio is edited by Albert Burge. And then to the folks at Podfly Productions who produce our show and roll it out at every week and get things going. Thanks again everyone for watching. For listening. Keep scaling up. We'll talk to you again next time.

Bye bye.

Are you ready to turn your goals into daily wins? You should check out our scoreboard software. Powered by Align, it's the official software for scaling alternative. With scoreboard, you'll get an AI driven coach for priorities and KPIs and it'll help keep your team focused on what matters most. With Align, you can track your goals in real time and you'll even see results on the go. With their mobile app, you can rest easy knowing that Align has world class onboarding and support to set your team up for success. This is really more than just software, it's what I actually use to manage growth in our scaling up client teams. Unlock clarity and results with scoreboard by Aligned. To try it now, go to aligntoday.com Bill G One more time. Aligntoday. Com Bill G that's aligntoday. Com BillG Check it out and try it now.