Cameron's Live Coaching Call with Elaine Stageberg, CEO Black Swan

I have this belief that when the universe asks you for something over and over and over again, eventually you step up and say yes. But I had to put it in a container that felt like this is something I can deliver very, very, very well, that I can serve people, I can give them what they need, but it does not become a distraction to the actual goal, which is running Black Swan Real Estate very, very well. That's how I. That's how I put that together.

So, Elaine, welcome to this live coaching call. This will be a great call today.

Yeah, absolutely. I'm excited to be here.

Yeah. Thank you for doing this. So, as a lot of the people who have followed me understand, as I've been doing coaching of CEOs now for really 16 or 17 years, since I left the formal CEO role at 1-800-God Junk. But even back in the late 80s and early 90s, I'd coached 120 entrepreneurs back then. So I've been coaching people for an awful long time. A lot of people don't really understand what coaching is. So today it's an opportunity for them to kind of eavesdrop in on a conversation, and they'll see a little bit of a spectrum. I probably lean more on the mentoring side than the Socratic method side. But why don't you just tell us a little bit about your business so they get a bit of a perspective there. And then we'll start you off as I do my normal coaching clients.

So my name is Elaine Stoggerberg. I'm actually a psychiatrist by training. I'm kind of an accidental entrepreneur. You know, long story short, as I was going through my medical career, my husband and I were also investing in real estate. We reached financial freedom through our own real estate portfolio. And along the way, people started asking if they could invest alongside us. So we created a private equity fund so that people can passively invest with us. We're the general partners of that fund. That's Black Swan Real Estate. So that's really the company that I run. I think of that as our investor relations, marketing, brand reputation, getting out, speaking, those sorts of things, raising capital. And then we also have Black Swan Living, which is our property management company. We're vertically integrated, so we manage everything that we own. We do all of the leasing, resident relations, maintenance, cleaning, lawn, snow. We're very deeply vertically integrated. My husband is technically the CEO of that company. So that's kind of how we divide and conquer is I do Black Swan Real Estate, he does Black Swan Living. But we definitely have a lot of crossover. We tried to limit it that way. There's kind of one cook in each kitchen, so to speak. But we, I would say there's probably 20 to 30% overlap. We have 50 full time employees across those two entities. We're principally located in Rochester, Minnesota, which is where we live. And about two thirds of our portfolio is here and then we have a satellite in Tacoma, Washington. We have about a third of our portfolio there and we have 30 employees there, but they don't report directly to us. We have a partner there who's essentially our operational partner that's doing all of the boots on the ground work there, managing those employees, managing those properties and then reporting up to us at the fund level. And then we have kind of a separate arm that I'm building because I, you know, I deeply believe in the power of coaching as well. A lot of people along the way have asked me to do coaching and I historically have said no. But I recently launched just a one time program where I'm doing some coaching around mindset habits, scheduling, entrepreneurship, scaling and thinking about kind of how does that relate into my investor relations funnel and how can I have that messaging in a way that's like not confusing to those folks and is a value add to the people that want that, but not confusing to the people that just want to do investment with us and are, you know, kind of distracted by this other thing. So those are the things that, that we have going on. I think some of the things that are really unique about what we do is I mentioned I'm kind of an accidental CEO. I came into entrepreneurship from a career in medicine. Always had a bit of a business bent. In between undergrad and medical school, I got a master's degree of Health administration and policy, which is like an MBA but specifically for healthcare. And then my husband and I run our companies together. So all of the fun, but also the challenges that go along with that. And then we have four young children. You know, a big part of my life, I've scaled back the number of hours that I've worked over the years to be able to focus more on them. I work about 30 hours a week, which is a really good amount for me.

Great. That gives everybody who's listening a really good perspective. It also gives me a nice little kind of base to go off of as well. The way I like to start all my coaching calls is just to get a quick update from you on what's going well with your business, what's not going well with your business, what are you working on over the next month. And where are you stuck?

I can't help myself but say, you know, what is going well is our company has grown a lot. So we have scaled our portfolio 100x in the last about three and a half years. So not only did our asset count grow, but you know, the people that we needed inside of our property management companies who manage those assets. And that has gone extraordinarily well. You know, A little bit of what's going well. A little bit of what, what's not going well is this year because of rising interest rates, we only had four acquisitions and our most recent acquisition was in April. We actually had all four of them close in April. Two here in Rochester, two in Tacoma. And that's been tough. That by nature, Nick and I are growers. We want to grow, grow, grow, grow, grow. And interest rates have just been such a major headwind that we've not grown the portfolio. So in some ways that's what's not going well. In a perfect universe, we would have continued with our 100x growth that we've had over the last several years. But how we've spun that is, number one, having the time to just train our people. We've been hiring and growing so quickly that there's just gaps in people's knowledge and experience. So by slowing down and really focusing on fundamentals, that's been good. We've converted about 10% of our portfolio from long term rentals to short and medium term furnished rentals. So that's been a neat way of having kind of a different business within a business. Like at the end of the day, you know, renting real estate to people. But it is a different, you know, it's furnished, it's different lease lengths, different customer service expectations and it's a steep learning curve. So what we're working on in the next month is really doubling, tripling down on our short term, you know, maybe we'll focus on the property management company, on getting that short term rental arm of our business really functioning really well. So right now we're in the slow season, it's November, so not a lot of people are moving. And this gives us an opportunity to furnish these units, get on Airbnb, vrbo, furnish finders, all of these portals, get five star reviews, all of our rankings, all of that. We would like to have 100 units operational by March. So that's 10% of our portfolio because that's when things really pick up in Rochester with people coming to Rochester to get medical care at Mayo Clinics. We're essentially a tourist town but for medical tourism. So that's what we're working on in the next several months. And then stuck from a mindset perspective. Sometimes I get kind of hard on myself of like, man, we really need an acquisition. We've never had an eight month period where we've not had an acquisition. We don't even have like very serious conversations going with sellers right now because they're just in a completely different universe that they don't think interest rates have gone up. I kind of self coach myself through that a little bit of like, well, we're doing these other things. We're working on really training our people. We're working on maximizing the income that we have from our current portfolio through the short term rentals. But I'd be lying if I said there wasn't times when I just get like almost like physically itchy. Then I'm like, come on, like I'm a growing company. I'm a person who wants to grow. Like how do I continue to grow despite the fact that there's high interest rates and slow deal flow?

So let's. I want to start with the high interest rates component because it's something that, I mean I've got a few more gray hairs and you know, you've got more kids, but I got more gray hairs. So I remember back in bought my first home in 1989 and I got a six and a half percent mortgage for only five years and I was doing the happy dance. I was like, this is amazing. Six and a half percent, this is fantastic. And then I got another six and a half percent mortgage in 2000, thinking again for a five year. And I was thinking this is incredible. For the last 13 years, since really 2008, 2009, when we had the global financial crisis and when interest rates really came back down, we've really been getting used to something that's been essentially artificially low. Have you talked about with your team how to operate the business as if maybe interest rates are always going to be where they are for the next 10 years. Like maybe they're not going to come back down and can you prepare that way and then if they do come back down, you win?

Yes. I think just time needs to pass is sellers need to hear from many different buyers. Yes, I'd love to buy your building at 30 million. I understand the neighbor sold at 30 million. I would give that to you in a heartbeat. If interest rates were still 3%. Right. When, when your neighbor sold, interest rates were 3%, you know, so right now the best we can do is 25, 26 million. And I think human nature being that if a seller hears that one time, they think, oh, this is just the buyer, you know, trying to get what they want. But if they hear it from several buyers, their psychology will eventually change. It's very good that in our market values are still very, very strong. We've not had some of the hit to multifamily values that other cities have had. I tell myself, like, this is very good for my existing portfolio that the values are still so high. And I think over time sellers will adjust with interest rates. So we do both single family and large multifamily. And even though that's technically the same industry, they do transact a little bit differently, right, because single family is based on comps and large multifamily based on net operating income. But on the single family side, I've been looking really closely at the data in our market and home prices are just not coming down despite the fact interest rates are skyrocketing. And so I'm starting to think that because there's just so little supply and such high demand, kind of the way I've been conceptualizing it in my mind is there's the law of price and interest rate inverse correlation, but there's also the law of supply and demand. And the law of supply and demand trumps the first law. And so I've been thinking about how can we continue to do what we know very, very well, which is buying single family homes, fixing them up, operating them very, very well, managing them, taking good care of our residents, you know, having a high renewal rate, all of those things, and do so in a low cash flow way, knowing that the value of real estate is just going to continue to go up and as long as it's cash flow positive, it's okay. If it's not the huge cash flow we were getting five, seven, eight years ago, shifting more of the return to debt, pay down and appreciation.

I wonder if there's also a way, like when whenever I've done M and A work in acquiring companies and we did a huge roll up of the collision repair space, it's now called gerber auto collision. $2 billion revenue company in the auto body space. And whenever we were doing the acquisitions, we never really worried about price as much as terms. I'm wondering if there's an opportunity and I'm not in the real estate space, so I'll ask the dumb question, but is there any way to look at Doing the acquisitions where the vendor does a take back or a second mortgage for a period of five years. Like could you give them the 30 million, but you're giving them 25 now and 5 million five years from now or 10 years from now. Is there any way to structure those things? No. And then is there another way just to even look at the model and look. Because you clearly understand the financials. Can you look at the model from a slightly different perspective as well? And are there other ways to just to do the acquisitions or to look for distressed assets or to go into different markets? I don't know. It's almost like when you come into strategy. Strategy is not planning. Strategy is around having the discussions around the what ifs. And it's when you can look at the what ifs from the real hard perspectives. Like what if interest rates stay at 8, 9, 10% for the next 10 years or the next five years? You really do have to plan for that. I sat with someone who was on the Federal Reserve bank about four years ago and he said he sees interest rates going to 11 to 12%. But what if he's right? You know, what can we do to plan for that? And then, best case scenario, what if interest rates drop by 2% or 3% again, it's highly unlikely they will. When mortgage rates were 8% back in 2000, it's highly unlikely that we're going to see them drop super quickly over the next three to four to five years probably.

So one of the things that we did through 2022 that was very successful is exactly what you described there in the beginning is we would say to sellers, okay, we can get you your, your top line because you're clearly very emotionally interested in that number, but you need to carry, you know, some percentage of it. And we were very successful that most of our acquisitions in 2022, we had a significant portion of seller carry with no interest and no payments for five years. So they'd get their top line.

They have, they can tell, they can tell their buddies at the golf club.

And we're happy to pay that because of the time value of money five years from now. And that allows us to get in, do the renovations increase the rent roll, you know, do all the things to drive up the value that, you know, the modeling shows that even with higher interest rates, we'll be able to do our cash out refi to pay back that seller carry. So we were very successful with that in 2022 and then kind of hit a bit of a brick wall in 2023, the reason you started to hit.

The brick wall was when the NASDAQ crashed in the fall of 2000. Really, like from April until November of 2000 is when the NASDAQ fell by 75%. Then we had kind of the flat line until about 2000, late 2003, early 2004, where even venture capital firms in the Bay Area were not investing, Nobody was investing. And it started to heat up towards the early part of 2004. So all of a sudden people had money, could get access to money, which is why those terms probably faded away for you. But, yeah, I think if you approach this like you did, then this is going to be a financial crisis. It is going to be different. Right. Like when interest rates are up, are up 200% over what they were two years ago. It's just going to continue to. There is going to be some fallout. So if you can get ahead of that fallout, I think you're going to be in a really good position. And I think the lessons that you did learn back then, you can at least pull those and start thinking about it from that perspective. I think that's something that you and your leadership team for sure, you and your husband, for you and any advisors, mentors, can sit and play with the numbers on those. You might come up with some very, very intriguing offers for the buyers. And it won't work. For every buyer, there's going to be buyers out there that are going to be. No, but there will be some. Some more buyers or investors out there that will take these deals all day long. So I think there's an opportunity. I want to talk a little bit about something you touched on, which was more on the opposite of the business. About growing your people.

Yeah.

In terms of taking the time to grow your people. Are you talking about frontline staff? Are you talking about managers? Are you talking about your leadership team? What do you mean when you're talking about growing people?

I mean really all of it. So, you know, to put it into perspective, we had just a few employees in our property management company as recently as 2020, and now we have 50. Just loosely, what our org chart looks like is we have a director of operations and then she has a team. We have a director of accounting, like a fractional CFO and then several accountants, bookkeepers. We have a director of communication. She doesn't have a team yet. She has a few VAs, but she really runs that herself. We have our director of growth, which is really our sales division. So that's like our leasing agents they also do acquisitions work, they'll do escalations. I find that kind of that sales Persona is a little bit better at handling an escalation if like someone's unhappy with a maintenance ticket or that sort of thing. And then we have our director of construction and maintenance and he does exactly that. So we have a townhome community that we're building from the ground up and then we do almost all of our maintenance for our building. We don't do any of the licensed things, so we don't do like plumbing, electrical, H vac, but we do kind of that general handy person, day to day stuff. So all of that was created in just the last several years. So we're growing those folks and then growing their teams as well.

Here's this is going to be the core thing to focus on. What tends to happen when you go from 10 employees to 30 and from 30 to a hundred is every mid level manager. And these are managers and directors. These are typically people that have never really run teams before, never really run businesses before. But they're good leaders, they're the best of the best. They're the people we put into management roles. Their answer to every problem tends to be hire more people. They don't know that that's what they're doing, but they don't know any other way. They don't see operational efficiency, they don't think of automations, they don't think of optimizing processes. They're really not great at saying no. And if they're gen Y and certainly the last cohort of gen Y, so this is like the 27 to 35 year olds. They grew up in the participation era where they got participation ribbons for coming in 14th place. So they're really good at being inclusive. They're very good at being good with people. They're really good at showing appreciation of. They're very bad at saying no. They're very bad at saying not now. Now I'm doing a sweeping generalization here, but my guess is that the team that you're going to get the highest leverage from is going to be your management team, teaching them skills like situational leadership, managing conflict, running meetings, interviewing, hiring, training and onboarding of people, managing projects, managing time and the ability for them to see how to get more done with less people faster. Years ago I was coaching a company and at the time they only had about 40 or 50 employees. They've now got about 1400. I coached them up to about 400 people in four years. And the management team there was the CEO, the COO and four directors that I was working with for a period of a couple days. I ended up end up running their strategic planning four years in a row. But at this particular meeting, they said the team below them, their managers were all managing three to four clients each. And I was like, well, when you six were running people, like when it was only the six of you two years ago, how many clients could each of you run? And it was six or seven. Six or seven. Six or seven. Seven or eight. Six or seven. And you were also building the company. How come you were able to manage six or seven and run the company, but now the people who only manage clients are only managing three or four? And they realized what happened was that people didn't know how to be efficient. They let the work get more complicated, more complex. They spent their time writing and drafting very long emails that no one had time to read, drafting really long proposals that no one had time to work on. They ran meetings for an hour. When the meetings only needed 12 minutes, they invited six people to a meeting instead of saying no to four of them and having a meeting with two people because they didn't want to hurt the other people's feelings. But what happens is Parkinson's law says that work expands to fill the space that we give it. And Parkinson's law is what really hurts companies that have 50 employees, because your mid level managers let everything at expand to just be longer and take longer and often cost more as well. What I would focus on with you is I know you said it would be great to get everybody skilled, but if you could get those five or six core managers and directors really solid skills and then look to actually get rid of 10% of the employees that are in your company without replacing them, to say, how do we actually scale the company with less people? How do we get our work done faster? I remember when we were building a company called College Pro Painters, which went on to become the largest residential house painting company in the world. We used to do time and motion studies. We would actually sit and watch painters in different states and provinces in Canada, and we would watch them paint different parts of the house to understand how long on average it would take to do things like, let's say to paint a standard door. And then we would train everyone to paint a door and we would see the time allotment would drop. So we gave people smaller containers to do the work and train them to be able to do that. And I think that's what you need to be working on. Now inside of your company is really teaching the management team how to get more done with less people faster. And it's going to be giving them the executive functioning skills that most of them haven't been trained in.

Let me ask like a very specific question, just links, you know, right into what you said. So for example, one of the kind of areas where I think there is room for improvement is we have this really wonderful facilities team. So they're doing our unit turnover cleaning, our post rehab cleaning and then like common areas, you know, of apartment buildings, those sorts of things. I see numbers on there. Let's, let's call it a post construction, post rehab cleaning because that's a little more kind of boxed in, right, A turnover. You know, people can leave it in various states, but I see numbers on there that seem very high to me. I clean my own home, you know, like I have some sense of, of.

How long, you know, as do I.

I'll bring it up of like, wow, I'm surprised that it took you know, 15 hours to clean like a one bedroom apartment. But I've never, I've never owned a cleaning company before and I've never been a cleaning person professional before. It's not like I've cleaned dozens and dozens of these one bedroom apartments to say with precision like, wow, you know, when I did it, it took six hours or seven hours or whatever. So I'll bring it up but then I'm not quite sure how to have the authority to say, guys, our standard for a one bedroom post rehab apartment is X number of hours. And if you need more hours than that, you need a phone call to your supervisor to explain why. And so I see these like cost inefficiencies. And I want to lead our people and I want them to have some sense of that. There's accountability and structure.

And what you see, what you're stumbling across is the ability to tell them what you know needs to happen, which is the container needs to be smaller and not wanting to tell them what to do because you're trying to give them some autonomy to be good at their jobs and not try to be like. But you're not being an autocratic dictatorial leader to tell them how long it's going to take. I'll give you an example. So your kids are 8, you know, 3 and 1. My kids are 22 and 20. So when my kids were 16 and 14, if I said to them, I need you to clean the kitchen and clean the living room and family room. I have friends coming over, oh dad, it's going to take us all day. It's going to be so hard. Or if I said, I have friends coming in 30 minutes, I need you to clean the kitchen, dining room, and everything as fast as possible. Don't spend more than 15 minutes. They'd be done in 12, and it would be pretty damn good. But what I did is I gave them a smaller container and I think an opportunity for you. So here's an example. How many one bedroom units, approximately, does your team have to clean per year?

Probably four to 500 units per year. And then one of those are one bedrooms. Let's say one.

Okay, so let's say you're cleaning four to 500 units a year, and it takes 15 hours per unit. You know, you can do the math. We're now talking about 6,000 to 7,000 hours. If you could actually reduce the number of hours by 20%, you're saving 1400 hours. What's your total burden? Cost of an employee? Around $20 an hour.

Probably closer to 25, 27 after all the employment taxes and workers.

Yeah, exactly. So call it. Call it $27 times 1400 hours. That's coming out to about. What is that, $50,000. It makes sense for you to go on one or two jobs and spend one or two days cleaning places. Throw on a pair of shorts and a T shirt and go and clean with them and work shotgun and do time and motion studies. We don't need to. To be down on our hands and knees scrubbing floors, or we do, but we don't need to be scrubbing the closets with toothbrushes. Or like, you need to observe it. You need to inspect what you expect. And then we also need to almost kind of create a contest model to have our employees show us the areas and the ways to get faster. So you kind of game the system in your favor and you say to them, I know it. On average, it's taking us 16 hours to do these places. What are the things that we would have to do to get it done in 10? I call this an overcoming obstacles worksheet. I give them a goal, and I just say to them, I know this goal is crazy. I know this goal can never happen, but the goal is to be able to clean places in 10 hours. Give me 10 reasons why that could never come true. And I actually did this exact exercise with this leadership team that had the six people. I said, what would need to happen to have all of your managers start managing six to seven people each? I said, tell me every Reason why that could never happen. And they came up with eight reasons why it could never happen. And I made them come up with two more. Until they had 10 reasons why their team could never go from three to four and up to six or seven clients. And after we came up with the 10 reasons it could never happen, we went back to reason number one, and we came up with two things to get rid of reason number one. Then we came up with two ways to get rid of number two. So in your case, it would be, what's every reason why we could never take the number of hours from 16 down to 10 or from 12 down to 4. What's every reason why this is crazy. Get them to come up with all the. And don't talk about any reason until they've come up with 10. Then go back to reason number one and say, well, what are the things we could do? By the time you get to start taking care of reason three or reason four, they start laughing, realizing they're now coming up with the plan to get rid of all the reasons. But they came up with all the obstacles. They come up with the plan, Then you actually challenge them to go do it. But that's how you contain Parkinson's law is by giving the managers and directors the skills to be more effective and efficient in their roles, by giving them the skills to manage conflict, by teaching them that we need to not give out participation ribbons anymore. You've seen the Navy SEALs, like, in a movie, I'm sure when if there were three Navy SEALs walking into a room and they know that behind the door is a bunch of people with guns that are going to want to shoot at them. They kind of go in like this. The person on the right only looks to the right. He never looks to the left. He never looks to the center. He knows the person in the center will only look to the center will never look to the left and right, and the person on the left will only look left. They know that as long as they do only their job, the other people will do their jobs. And as soon as they do something else, they're dead. Your managers have to be okay with saying, I don't need you to come to this meeting, or, I only want you to be the bathroom cleaner. But if they come up with the plan, they'll be able to execute on it. But you need to start looking at not just you. Your company needs to start looking at ways to actually get more done with less people faster in every area of the business. And that usually comes with systemizing things. So when we scaled 1-800-got-JUNK, one of the things that we did was we looked at every single aspect of the business, from recruiting a person, to hiring a person, to onboarding a person, to managing a person, to firing a person, to putting up signs, to hauling junk, to driving to the dump. We looked at every single part of the business and thought about how do we get that single unit of work done for less time and for less money? And then we trained people in these very, very simple systems. But again, what tends to happen in exactly the zone that you're in is we're trying to let people do their jobs. They we're trying to focus on scale. But we often waste a lot of the gross margin that we have in some of the inefficiencies that naturally happen at the stage that we're in.

One of the inefficiencies that I see as our team has grown is compared to how it was several years ago where there were just so few of us. Let's use an example of maybe a resident is unhappy with a response to a maintenance ticket or something like that. Well, it used to be that there were so few of us that we all knew the whole situation and we could comment on it, we could troubleshoot it. But now it might be that a maintenance ticket is submitted. Our director of maintenance assigns out those maintenance tickets. Let's assume for this, for the sake of this scenario, it's like a handy person thing that our internal team is doing. So then a maintenance tech goes out and does the work. And then maybe the resident submits another ticket saying they're unhappy with it or didn't meet their expectations in terms of time or thoroughness or, you know, or whatever. And there's so many people involved. Then we spend so much time kind of getting everyone up to speed.

This is when you want to step back and stop the team and say, okay, for the next half hour, we, as the people involved in this kind of situation, are going to talk about how could we make this situation faster? How could we remove some of the people from the situation? What are the things that are making this go slower? You've experienced this as an example. You ever notice when you go to a restaurant, this is one of my. Drives me crazy in restaurants when this happens, especially like overseas and in Europe, you ask them for the check, they bring you the check. They know for sure you're going to pay with a freaking credit card. Like 99 times out of 100, we're paying with a credit card. So they bring you the bill, you ask for the credit card, they go back and get the credit card and come back again. It's not like they don't already know that you're coming with one. If I was running a restaurant and I didn't want to have all this extra staff and overhead, I would bring you the check and the credit card at the same time. Kind of like when you're. You know this with kids. Whenever you walk around your house, I guarantee you you're constantly picking stuff up. You're picking it up and taking it to the kitchen on the way to the bathroom. You're moving stuff like we're constantly moving things. To be efficient, we need to teach our employees to do that way as well. We need to teach our employees to kind of get out of the way or do things more efficiently. And it's by taking every single aspect of the business and starting to remove the space in between tasks. Like it might be, I email you a task and then I wait for you for two days to respond to the task. Instead of removing the gap of the two days and using some kind of, like Zapier and some kind of automation or integration to remove the people and the time from systems as well. And if your team doesn't have the skill to look at, then bring in a consultant who can help you with it to automate and optimize. But it is going to be by starting to look at every single aspect of the business to see how do we get less people involved, how do we remove the time in each of the state, how do we optimize certain things, how do we say no more or how do we do it right in the first place. But it's going to be a little bit of the inspect what you expect. You've done a really good job with getting stuff off your plate, right? To remove as a mom with four kids and running these businesses, to get yourself down to 30 hours a week means you're actually good at delegating. Now we need to do is start really getting good at growing people, but not so that they're working harder.

For a while we were growing so quickly that it was just, you know, drinking by fire hose, right? Like that, that old analogy. And our people were learning so much so quickly. And for the most part, they were doing a very good job. Maybe they weren't doing it exactly the way Nick or I would have done it years ago, but they were doing a very good job. Now that we've had an opportunity to slow down and look at Some things I see, you know, opportunities for growth, I see inefficiencies, I see times that, you know, take like a maintenance ticket. Like six different people are involved. And I'm like, well, it's no wonder that like no one knows exactly what's happening. And the residents frustrate. They don't care that six people are involved. They just care that it wasn't fixed in a few hours, you know, to like, to their specification. If anything, they're frustrated. They're like, who is responsible for this?

Right? And when six people are involved, that's actually driving them crazy because they realize the inefficiency and the bureaucracy and the fact that like, you don't have your shit together, right?

So I see these opportunities for growth and it's been helpful. I've been, you know, taking notes about like, you know, really focusing our time on, on training our directors and by.

The way, sometimes in honing in on one of these examples, even though it might not be the one that's massively going to change the business, what it will do when you get the six people together to come up with a more efficient way to do it is it starts teaching them to be more efficient so that then that's what really changes the business. So sometimes it's like, well, is it worth it to spend the time to fix this one issue that's not really what you're doing. What you're really doing is growing their skill set and their confidence at fixing lots of issues like that. So I was in a gym in Scotland last summer and I saw a bunch of stuff. A very, very nice, high end personal training gym. But I saw some stuff scattered around on the floors and I said to the owner, you know what you need to do? Like, look at all this stuff. He goes, oh my gosh. He went to start picking it up. I'm like, no, don't pick the shit up. Call all your employees in when I'm not here. As soon as I walk out the door, call all your employees together, get them to stand in the middle of the room and get them to look around at what could be clean, what could be better. Don't even say what could be cleaned up. Get them to see what you can see. Don't clean up for them, get them to see it. And I think that's what you can start doing with your team, is fix one issue. Get them to fix one issue so they can start seeing other issues that are similar.

At times I feel a little overwhelmed with, with training and growing our people because there's just so much my, my husband comes from a career in tech, so he's who is boil the ocean. Are you familiar with that?

Yep.

Little thing and like teach them every, every little step. And so how, how do I balance or maybe I do need to get it with my team and create like all the checklists and all the steps and all the things versus like how do I balance teaching? These are our overall core values. These are the overall like customer service standards, efficiency standards, cost standards, and then let them come up with, you know, the individual checklists and the individual, you know, step by step processes. There's so much to teach that as a leader I almost don't know where to start. I'm like, do we do an hour of teaching every single day? Do we block a week for a leadership training? Do we block two days for a leadership training? Do we block two days for a whole company training?

Yes to all of those. Here's what's going to start shifting now is the real the realization is the leader's core job is to grow people. So all of the stuff that's on your to do list, I would even try to delegate 30% of what's on your list so that you have 30% more time to spend your time growing people. And growing people can also mean blind ccing them on emails so they can read what you read, letting them sit in on phone calls so they can hear what you say, letting them sit in on the corner of a room so they can see how you, how you treat things. Doing work and actually having using loom or a screen capture so they can watch you doing the work that you're doing. It doesn't mean that you have to necessarily take time out of your day. I launched a course two years ago called invest in your leaders which covers kind of the 12 core skills. You could plug five people into that course for $700 a person. Now you're spending $3,500 which is a rounding error considering what they're going to grow from. So you don't always have to come up with the core content either. But it is coming down to now is you spending time and your husband spending time on growing people. Delegating more and growing people. Delegating more and growing people. I love that you talked about like the core values approach as well. Simon Sinek, who used to be on our board of advisors four years before he wrote the book start with why, came up with the idea of the golden circles and it's the why, how, what so the why is training every single person in your company on the core values, the core purpose, your bhag, your vivid vision, telling them, teaching them about how the company got from where it was to where it is today, how you got through this crazy hundred x growth period from 5 people to 50 people, really indoctrinating them in the cult or the culture of black swan. Then it gets out to the how most companies train on what we do. We train them on how to, you know, to clean an apartment and we train them on the job. When I'm talking about my course, invest in your leaders is the how it's situational leadership coaching, interviewing, running meetings. Like as an example of all of your managers, anybody who manages people, how many of them have ever been trained on how to run effective meetings? None.

Trained by us. Certainly none.

And have you and your husband had training on how to run meetings?

Some. I've done two years of strategic coach. So they don't specifically talk about that, but they talk about.

They never do. I did seven. I did seven years of strategic coach. There's not a single module in strategic coach that talks about the, the dos, the R factor question, the strategy circle. Like there's not a single thing on how to run meetings. Amazing content, fantastic. And I love the three year of the signature program more than the masters and more than three years with Dan in Chicago in his 10x. But there's not a single module in anything in strategic arch on how to run meetings. And all of your managers run meetings every day. I'll give another example. How many of your people, how many of your managers have ever been trained on how to do an interview?

Then something I think we did really well is our very first hire. He had no property management experience, no real estate experience, but he was the director of recruiting and training for a large healthcare organization. And we had this sense of, hey, we're going to be doing a lot of hiring over the next several years. And so our first hire should be someone who's really good at hiring.

Hiring. Yeah. Great.

We've not done form, like we've not had him training our other directors.

Right. And so now you've got other directors that are doing job interviews, but they don't really know what they're doing. And you're not doing anything wrong. You're doing everything that every normal company does. But the only way we scaled 1, 800 got junk was I trained all the managers, directors on VPs, on how to do interviews. Then they actually videoed themselves doing them and we got to Certify them in doing interviews. We trained them on how to run effective meetings. Like we had certification modules. Anybody who runs one on one meetings, or any of your directors and managers that coach people one on one. Have you actually trained them and certified them on situational leadership? Have you trained them and certified them on coaching? Have you trained them and certified them on managing conflict? Have you trained them and certified them? So this is the stuff that when you train them on that your business goes to the moon. Because right now what you have is everyone working hard, trying their best, but they've never really been trained. And I had a CEO about three months ago, he said, you know, I've never been trained on how to do an interview, but I've interviewed and hired a hundred people. And I said, well, maybe you've done it wrong every single time. And he went, oh, I saw one of my kids playing baseball and they were showing like, hold the bat and move your elbow up. I mean, no one showed me to move my elbow up. I played baseball for like five years. I mean I was. Yeah, but no one ever showed me that. Or if you golf, like, keep your left arm straight. I mean, like. But we don't train anybody on the basics in business. So I think that's where you really want to hone in on is remembering that no one's really had the training, the real training. And so that's what I want you to focus on. So many companies screw up and they give everybody vice president title or a C level title. They're not a C level person. They're at best a director. You've done a really good job with doing that. Now it's about giving them the skills and the confidence, Both skills. Pretend that every manager and director that works for you is climbing up two ladders and the ladders are right beside each other and their left hand and left foot is climbing up a 40 foot ladder and it's skills and their right hand and right foot is climbing up the confidence ladder. You have to grow their skills and grow their confidence and grow their skills and grow their confidence by giving them more projects, by telling them what to do, we end up shaking the confidence ladder. So if you flip the org chart upside down and do less work and spend all of your time and spend all of your thoughts on how do I grow people's skills, how do I on every aspect of their job, that's where you win. You said something around coaching. Have you ever heard the analogy that a person can only sit on one toilet at a time?

No, but it makes sense.

And if you try to sit on more than one toilet, it gets kind of messy. My gut is that black swan on the private equity and on the real estate and on migrating 10% over to the Airbnb, which, by the way, I think strategically is spectacular. Those are. That's a very good. Two toilets. Your husband's sitting on a toilet, you're sitting on a toilet. Awesome. Coaching is as an ego play. It's making you feel good, it's making you like people like me. They want to learn from me. But strategically, it's trading time for money strategically. And you actually nailed it. More than 90% of people do. It might confuse the messaging and the marketing of what you really want them to invest in, which is the private equity fund. And, like, I think I would be very careful with adding this to your model, because I think your model will work when you continue to focus on it. And it's like light. If you take a light and you disperse light, it can light up a room. But when you take light and you highly, highly, highly compress it and focus it, it becomes a laser and it can cut through steel. For me, I feel like adding coaching to your time and day and business is going to take away from your kids, take away from your family, take away from your husband, take away from your business, take away from these core toilets, and it'll be good, but it won't necessarily be what you do.

That's been my. My hesitation to doing coaching before is like, I have these two really big companies I need to run, and, you know, people have entrusted us with $60 million in the last several years. I need to be really focused on honoring that commitment that people have made. So many people ask for coaching.

Do it in 10, but do it in 10 years or do it when you have or do it when you have.

Well, it's already launched, so I can't go back on the people that I've committed.

You can stop it. You can sunset it in 12 months.

I made the container very small. Okay.

Is it one on one or group?

It's group. So I said it's group. I said, this is a true statement. It's not a sales tactic. I'm offering it now. I don't know if and when I'll offer it again. If you're one of those people that has asked me for coaching over the last several years, and I've historically said, no, this is your chance, and I'm limiting it to 12 weeks. So that was a way to feel like I have this belief that when the universe asks you for something over and over and over again, eventually you step up and say yes. But I had to put it in a container that felt like this is something I can deliver very, very, very well, that I can serve people, I can give them what they need, but it does not become a distraction to the actual goal, which is running Black Swan real estate very, very well. That's how I, that's how I put that together.

So I'm going to give you one, one kind of thought around this before we wrap. And this was back in, in 2007 when I left 1-800-God junk, I started getting asked to be on boards and I reached out to one of my mentors and I was 42 at the time and my mentor said, Cameron, you're not bored enough to be on boards. Said, when you're 60, you can be on as many boards as you want. But right now you should be in building. And I think there's an opportunity for you to remember that. Yeah, the whole universe might be telling you to do coaching, but maybe it's not now. Maybe now is the time to really focus on these two businesses that you've got and the kids that you've got and really skilling up the people that you've got so that these businesses are running themselves. Because you never see a CEO. I coach the CEO of Sprint, Marcelo Clare. I coach CEOs of $100 million tech companies, thousands of employees. Those CEOs are never out coaching people. And people always want their time. They're also not on boards. They're, they're focused on building the golden goose. And I think you have an opportunity to really like run this 1212 week program. That's cool. My gut is, is put go all in around the businesses with Black Swan that you are running and then know for sure that in five years when you've got both of these businesses doubled or tripled and you've got a real leadership team in place that have all run businesses before, they've all got the skills and you're like, what the am I going to do now? I got nothing to do because these people are running my business. That's when you start your group coaching and then really drive group coaching into hundreds and hundreds of people. Like what Dan Martell is doing with SaaS Academy. He's got SaaS Academy up and running. Matt Verlachi is running it for him and Dan's now doing group coaching. He's also flying around in a private jet and he's got all the time in the world. He's kind of bored. I'm like, he may as well do that. I think that's your opportunity.

I don't disagree with that. I definitely do not see a future where, say, like, a year from now, I'm spending a significant portion of my time on coaching. I. Exactly. Like you said, I have this business I need to raise. I did feel like I had some extra time because we haven't had acquisitions. So that's why we made the strategic decision to launch the Airbnb. I thought, you know, this is the opportunity where I could kind of package up this coaching, give it out to the people that have asked for it all these years. We've had phenomenal enrollment, and then I have it, and I can. When someone asks for it, I can say, well, we have these recordings, or whatever. I don't see a universe where I'm repeating coaching over and over, because that unto itself is a lot of work. It's a lot of emotional work. Like, you know, growing people is. There's a lot there. But it felt like there was a window that it really made sense. And. And I. I think it all came together, like, in a lot of flow. It felt very good.

I think your biggest leverage around coaching is going to be spend your time coaching your people and your managers. If you went all in on coaching and growing them, you would triple the size of Black Swan. But all of the time you give somewhere else is. Is. Is potentially sitting on two toilets. And I don't. I never argue to be right. I only argue to be heard. So I just want you to hear it and let's run with that.

Absolutely.

I'm glad it was there. Thank you for opening up with us. Thank you for sharing. Good luck. Stay in touch. For sure. So don't stop now. Click here. There's more great videos that you can keep learning from, and together we're unlocking amazing leadership lessons together.