System of Business Growth Stages with Daniel Marcos

Welcome to the System Hub Podcast. Hola.

Konnichiwa. Guten Tag.

Where we interview world-class experts.

You have to have a lot of passion for what you're doing.

I was fanatical in my 20s.

If you could find a way to produce a business that works without you, your life would change like that.

Extracting, organizing, and optimizing their best systems and processes for rapid business growth. Now let's get into the show.

Welcome back to the Business Systems Summit. And in this session, we're going to be chatting with Daniel Marcos, and we're really fortunate to have him. I was doing some correspondence with Verne Harnish from Rockefeller Habits and Scaling Up about the summit, and he recommended— I said, you know, is there someone that you can suggest who'll be able to suggest some of the ideas from your books and also Gazelle's? Because his work has really had a big influence on the way that we run System Hub and the way I've grown our businesses. And it's something that I just wanted to share with our audience. And he immediately suggested Daniel. He's the co-founder and CEO of Gazelle's Growth Institute. I'll have all the links beneath so you can go check them out. But he's an international speaker having shared the stage with some huge names, people like Peter Diamandis, Guy Kawasaki, Jack Canfield, and that's just to name a few. And some of the different programs that he's pulled together as well that you'll see on Gazelle's Growth Institute, it's just amazing. Like we're talking real thought leaders. And you can see in Daniel's photo just behind him the amount of books that he has. This guy just loves to consume and learn as much as he can about business and is very free in having to share that as well. He holds a degree in industrial and systems engineering and an MBA. So he's definitely wired with a systems brain, I think, to do industrial and systems engineering. I've had a few people that have let me know that they were engineers in a past life and that the brain works in a systems process. So it's a very much with great pleasure that I get to welcome Daniel to the Business Systems Summit.

Thank you, David. Thank you very much. And let me, let me start with a story and how I met Vern. So Vern, as you know, founded EO, the Entrepreneur Organization, the biggest, most influential network of entrepreneurs around the world. And I became a member 2000, 17 years ago, because I was growing. My business went like from 4 employees to 85 in like 6 months. And then we took it over like to 1,200 employees in the next couple of years. And I was 26 years old, and indeed I sold my company to a younger 24-year-old. And of course we had no idea what we were doing. We were really growing really, really fast. And I signed up to this organization, it's called EO, and one of the programs they have is called Birthing of Giants, and it's a program in MIT that you go in for 5 days for 3 years in a row, and you talk like with 8 or 10 thought leaders. So they send you the books before. This time I was based in Mexico, my home country, and they send the books by mail. So they arrived 48 hours before I had to go to MIT. So I receive a box with like 10 books, and I've already read a book in college. I was really a bad student, and I never had the discipline of reading in college. I really didn't like school. I was an entrepreneur since I was a kid. But then they sent me these 10 books and I had like 48 hours really to read them. So I didn't went to the office and just went to my house and read for 2 days and on the plane and everything. And went to MIT and the program and all that. And I realized that every problem or opportunity I have in business, someone else already had that, built a system or a procedure to fix it and wrote a book about it. And I was like, oh my God. So now every problem that I have, I just need to find who's the right person that had that problem and wrote a book about it and became a fan of books. And now you have this and they have a couple more here. I haven't read them all. I probably read probably 50, 60% of them, but I know exactly where to go and look for that problem. And this has been huge for me. The confidence of execution and the level of execution, it's completely different. And so big, big learning for me. And I congratulate people for being here. The only way we're gonna be able to grow our business if we're lifelong learners and we continue to read and learn. So congrats for being here. Should I start, David? Should I— Yeah, I'll let you take it.

I know that that philosophy that you just shared right there is very central to the way that we think as well, particularly for this summit and System Hub, which is every problem within business really is just caused by a system or a lack of a system. So the real key is to identify that and then seek out the right system. And I know you're gonna kind of take us through almost like a system for growing as an entrepreneur So you can identify where you are, helps you identify what issues you've got, and also problems that you need to solve through systems to move to that next level. So by all means, I'll let you drive and I'll just chime in if I've got any questions as we go.

Perfect. So I'm a partner of Vern. We have, we co-founded this company Growth Institute, and I've been using Scaling Up or Rockefeller Habits for 17 years as an entrepreneur. But what I really been learning in the process is Scaling Up or the model Vern gives us is just one model. And it doesn't matter what stage you are at, you implement it, you will give your results. But I've been implementing 17 years as an entrepreneur and like 9 years as a coach, coaching other CEOs how to implement. And I've learned and realized that the implementation is very different depending on the stage. So I've been developing this content that I will be working with Vern on how to understand how to 10x your company based on 4 stages and what you have to do in each stage. So we'll take you through the process on that. And here the idea and what we say in Growth Institute and why we build Growth Institute is to help a million companies grow faster with less drama. And here's where the systems come. If you have systems and procedures, you don't have drama. If you don't have systems and procedures, everything's up in the air. So how can we give you the right systems and procedures to reduce the drama in your organization? When we ask entrepreneurs, hey, why you became an entrepreneur? They always say, I want freedom. They tell you many things, but overall, if you ask why and why and why many times, you come back to freedom. And freedom is being able to have freedom of money, cash flow, freedom of taking decisions, live wherever you want to live. Those are the kind of things. If you really want to have freedom, you have to scale up your company. Many companies start, very few scale. So how do you scale up your company? Here I'm gonna go to some learnings. So first I'm gonna focus on the scaling up part. We really believe there's a lot of great content for startups, there's a lot of good content for the big ones. We really focus on the scaling up. And by the way, that's the part where you have the most fun as an entrepreneur. And two, that's where you make the most money. It's not the startup, it's really when you scale your company when you really create good assets. All right, so stage learning number 1, companies grow in stages. And this is a picture of the US today. The US has around 28 million companies registered on the IRS. 96% of them do less than $1 million in revenue. The percentages in the world are very similar. Of course, my home country like Mexico, we don't have 28 million firms, we probably have, I don't know, 50,000, 100,000. But reality is this, very few are able to go above a million. And when you apply to EO and YPO and all these CEO groups, the first thing they ask you is how much you, what's your revenue? To enter EO, you have to do over a million dollars in revenue. To enter into YPO, you need over $10 million in revenue. Because if you're an entrepreneur that already passed that, you have proved yourself that you could scale up your company. And then just 4% do over a million, 0.4 do over $10 million and just 17,000 do over $50 million. But the interesting thing is from stage to the other stage, you go down into a valley of death. And that's where most companies die. They don't have a system and procedure to organize the go from one stage to the other. And that's what we're gonna talk, what decisions you have to take on each stage to go to the next stage. So if you could see my graph here, I'm trying to design some stages. I'm going to do an analysis first to a human being and then I'll go back to the company. So if you see my cursor here, stage number 1, stage number 2, number 3, and number 4. So stage number 1, you're a baby. Stage number 2, a kid. 3, an adolescent. And 4, you're an adult. So on stage 3, how do you feed the baby? You sit down the baby on a chair, strap the baby, open a Gerber, and then get a spoon and feed the baby. How many portions of Gerber are you going to spend? Probably 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 1/2 portion, the baby is full. How much time it will take you to feed a baby? Probably 10 minutes, 12 minutes, baby's done. They want to go and play. So whenever you get around here, probably around a year, the baby tries to take the spoon from you because they want to eat, they want to feed themselves. They believe it's a game. So you say, great. So you put the baby on the chair, strap him, get the Gerber, give him a spoon, and then you go to the back. And what is the baby going to do? They get a spoon, throw it to the wall, get the Gerber, try to put it in their mouth, put the hand, they make a mess. And as a parent, you said, well, he hasn't ate anything, so I'll give him another Gerber and another one. And you probably give him 4 or 5 Gerbers and he spends probably 40 minutes in eating. But as a parent, you said, it's fine, it's part of the process of learning how to eat. So you allow your baby to go and do that. In companies, we don't want that. We want our companies to go straight like that, and that's not reality. So the systems and procedures that took you to the first stage will not take you to the second stage. They always go through a valley of death. And here two things happen. You lose productivity, one, and two, the drama just goes way high in your company. People just begin talking in the cooler about how bad leader you are and the new person you hired and all that. So it's very important that you have a system and a procedure to go from one stage to the other, and that's precisely what we're going to talk, uh, first. So I'm going to talk a little bit about 4 stages. I'm going to get deeper into this slide later. I'll just give you a breakdown. Stage number 1, it's a venture startup, probably 1 to 5 employees, and the most important is to focus on product development. Stage number 2, 6 to 15 employees, focus 100% on sales. Why? Because now you have a team that you have a salary and a rent and an office and the rest. And if you don't pay your fixed expenses, you're under. So you have to feed the baby or feed the animal that you have created. Number 3, third stage, medium-sized company, 60 to 250 employees. Now you begin defining the industry. That's where you begin scaling, when the fun starts. And then stage 4, over 250 employees. So let's get deeper into the stages. So stage number 1, and a lot of us have seen the book Crossing the Chasm, And it says between the visionaries and the pragmatics, there's this space that we need to jump. That's a space that you jump once you do $1 million in revenue. If you're able to do $1 million in revenue, you could prove yourself that your product has a market. Because it's hard to do $1 million just with your friends. You have to really prove yourself in the market. So what's the priority in the first stage? Nail your value proposition. You have to understand what are you selling, at what price, what packaging, what's the marketing you have to do and the messaging to be able to sell whatever you believe the market is going to buy. And if the market buys it, then you value your proposition to the market and you're able to get some money. The barrier to do that is market dynamics. You need to understand who's your competitor, what prices are they selling, discount clients, all the rest. You need to understand how's the market running today. And the market you're coming in. And the ability is marketing. It's all about marketing. It's really, for me, stage 1 of marketing is not a mass noise, if you want to call it, to bring your clients. It's a way to really have a conversation with your client, to really understand what are you selling them and them telling you what they want to buy. And that conversation really allows you to nail your value proposition. And of course, it's all about strategy. People write a business plan. I did my MBA in Babson, and we always said, when you put print in the printer, you're like, oh, I forgot to put this, or I should change this. So we say your business plan is old whenever you click print in the printer. All right, stage number 2, grow-ups. And by the way, this is a picture of Microsoft when they were starting to grow up. You will never have invested in this company, or very few of them have invested in the Microsoft is what is. But that's the size of a growth, that's the way it looks. So that's usually when, when VCs are able to understand when to put their money in a company like this. So priority, hire the right team. On the first stage, you really had a system to hire people and really the good people never wanted to come work for you. Too much risk, you haven't proven yourself. Now you have to really begin being selective of who you hire. On the first stage, Vern always says, if they have the breath test, if they're breathing, you hire them. You really cannot allow yourself to be very selective. Barrier: leadership. On the first stage, you do everything. Here you don't— it doesn't matter if you're a leader, you have to be an entrepreneur. Stage number 2, now you have to begin leading a team. So now learning how to delegate and define direction is very important. Ability: predict, delegate, and repeat. Now you have to begin having a repetitive process, that's when you have systems. In the first stage, you should not have systems. You're really testing and understanding what you need to do. On the second stage is when you begin to build your systems. And of course, decision, people, and cash. People, you have to now hire the right people and understand what is to be a leader and the rest. And cash is the toughest decision or the toughest stage for an entrepreneur in cash. First, when you were very small, all your new clients or your employees, they say, well, they're too small, they don't have money. And they give you slack, they accept that you don't pay them much or your product is not great. Once you're in second stage, now they see that you're beginning to grow and now people begin getting greedy and they begin asking you for better value or you for paying them a bigger salary. So that's when the entrepreneur has the biggest cash constraint and it's the hardest part for the entrepreneur on cash-wise. Stage number 3, priority scaling up. Now you nailed your product, you put your systems, you have the right team, now is when you begin scaling your company. Barrier infrastructure, that's when the wheels begin falling off from the car. You begin with your car, you build your car, you think it's great, and when you begin putting the accelerator, the wheels just begin falling off. So you have to really, really have to build your infrastructure. That's when you begin looking at SAP and these other systems to really put a good structure in your company. And ability, Align and simplify. Everything you did, you wanted to be very creative and adaptive and all that. Now you have to simplify. Now you understand your process and your systems. The first time you build your systems and your process, it's pretty clunky. Now you have to know how to understand it, how to make it easier and simpler, and align people in just one or two things. And decision is all about execution. Now you know your product, now you have your team, now you have your systems. Now you have to replicate that as fast as possible. And as cheap as possible. I like to talk about organizational charts. I don't like them as an entrepreneur. I don't like to run with an organizational chart. Reality, they're very important. They're extremely important to give structure to your team. So there's two things that I want to talk about organizational charts. I don't like to have them in stage 1 and stage 2. I think in stage 3, they're extremely important. And there's two things that you have to do right on stage 3. The first one, you have to divide— I'm sorry, I hear the O and the S are below, but I really have the first, the CEO position. You need to have 3 people. You have the CEO, who is the head of the company, and then you have an executive assistant, male or female. I don't care about ages or timing or whatever, but you need someone that really fixes a lot of small things that you don't have to do. If you don't have an executive assistant, you are an executive assistant. My father worked in government in Mexico for many years. I had like 10 secretaries and I thought it was a huge waste and it was a government structure. Now, being an entrepreneur, having an executive assistant for 9 years is the best decision I've ever taken. It's incredible how much of my time she takes off my plate of just doing the small stuff that you don't have time, like buying a plane ticket, reserving a hotel and things like that. And then the other one, you need to have someone in HR on a strategic level. And by the way, you need to have two people of HR. One on a strategic level, that if you read this article from Ram Charan, you want to get deeper, they call it leadership and organization. And then you have an HR administration. This is the HR person that is in charge of paying payroll and contracts and the rest. And this one as a coach to the CEO, to putting the first line of executives. If I have a great head of sales, How many sales problems am I gonna have? None, because my head of sales is gonna do the right thing. So, but I don't have time to have the right head of sales and to coach the head of sales correctly. So I need to have someone at my level that is higher than them in an organizational charge that could coach them. So what do you do? How do you have this person? In a third stage company, you usually go to an ex-CEO, someone that is already retired, in their 60s, 70s, that they don't want to have a full-time job, but they want to go to an office 1 or 2 days and be able just to, to stay active. You bring one of those persons to coach you and help you coach your first level. And the most important role of the CEO here is have a great and very strong first line. If your first line is really strong, then the rest is very easy. So you want to have a CEO coach or someone in your table or in your in your office to be able to do that. And then the second thing that we've done that is very important, you have to turn around your organizational chart. Why? I've been coaching a lot of companies, 25,000 employees, 5,000, 10,000 employees, and the management team talks about the people below them in the org chart, like very dispectively, all the people on the floor or the people in the factory and the people— and they were like, those are the guys really doing the job. You're here because they exist. If they were not there, you don't have a job. Your job is to manage them and help them be more productive. So whenever you change the organizational chart and you turn around, it makes a lot of sense in your mind on what is leadership starting stage number 3. And now you're a coach supporting your team. If I as a CEO have a great first line, they will do great for my next line and my next line. And the line that serves my client. The upper line, those are the most important people in your team because those are the ones that touch your client. It's very simple, but once you invert the organizational chart, the mentality of the team changes completely and they go to a service and coach mentality to be able to help their company be successful. So I strongly recommend that you build an org chart on stage number 3 and you flip around. Today we're building in both these two precisely, we're growing our organizational chart. We're doing more a team of teams structure. By the way, it's a fantastic book, very recommended. It's done by a commander of the Navy in the US, brilliant book. He said, whenever I join in, and numbers are not exactly correct, but he said, when I joined, he was the chief of the Special Forces of the US, said we're doing one attack or we had capacity of doing one attack every 7 or 15 days. When I left, we were doing 15 attacks a day, and just because he changed the organizational structure. Alright, I always love this quote by Steve Jobs of the amount of time it takes to grow your company. And why is it very important for me? Because I see a lot of entrepreneurs, they want to throw money to try to scale faster without doing the right stages. Like, if you don't walk, you could not ride a bicycle. And people said, but I'm gonna buy this such a great bicycle with a motor and everything. I don't need to learn how to walk. No, you're gonna need how to learn how to walk. Whenever you fall, you're gonna have to walk. So you have to go through the stages to really be able to do it. It takes a long time to do it. Learning number 2, you have to identify and remove the bottlenecks. The most important role of the CEO is removing the bottlenecks of the company. Ari says it right, your role is to be able to accelerate the speed of growth and really fixing and resolving the problems. And the best book for that is The Goal by Eli Goldratt. I think it's a fantastic book. And Vern tells always a joke that he teaches us two things. First is don't smoke. He died of lung cancer. You always saw him with a cigar in his hand. But the most important is theory of constraints. The most important job of a CEO is understanding the constraints of the company and take them over and fix them. Because once you fix a problem or constraint, that creates another one, and you fix that, and then that creates another one. Really, really good book. And of course, most of the bottlenecks are always at the top. So we have to start with us. We are the most important bottleneck in our companies. So how do you have to evolve from entrepreneur to CEO to allow the company to grow? When you're in the venture, in the startup, 1 to 5 employees, for development, the entrepreneur is everything. Technical, administrator, and entrepreneur. You have to do everything. You're the center. Your employees kind of do things around you, but you really are doing everything. 6 to 15 employees, you have to focus on sales, as we— as an example. And now you have to be a leader. You don't have to do everything yourself. Now you have to teach people how to do things. You have to delegate them what they have to do and define the direction of the company. But on stage 2, you're delegating or being a leader one-on-one, and that leadership, it's hard, but it's not as hard as stage number 3. That's when the challenges really, really come. Now you're a leader of leaders. Now you have to teach someone leadership and give them direction, and you have to expect that they will do the same with their team on the right— with the right quality, right information, right core values, everything. That's when leadership becomes really, really, really hard. So you have to be a much better communicator, design action plans, team building, and being a better coach. And we say we're playing phone tag or phone because you tell your employees something and then they tell the rest and the rest of the rest and the communication just gets destroyed. So it's extremely important how you communicate and how you build leaders. That's why on stage number 3, the most important thing you have to do is build an organizational chart to really give direction and clarity of communication to your team. So that's stage number 3. And then stage 4, you become a satellite around your organization and you have to do 3 things: be strategic innovator, change catalyst, and chief of culture. The day-to-day operation, you're not responsible for them. You already have systems and procedures and people to run day to day, now you have to make sure they're on the right direction, they're doing it with the right culture, they are serving your clients with the core values that you set, and because you're an outsider, you could see trends and be able to bring strategy and change to the company as an outsider. So those are the 4 stages, and that's how you have to evolve from entrepreneur to CEO to really be able to overcome the problems and take it to the next level. Most companies die in the valleys of death, because of leadership of the CEO. The CEO, we don't have the capacity to go from one stage to the other, and it's all a human mental game. That's what this helps me, all the books. That's what I've learned, the stories of how to go from one stage to the other in pieces. And here's an important subject. I read mostly business books because I love them, and I like— I'm an engineer, so I want the steps, 1, 2, and 3. And I have a friend I respect a lot that he said, I read 2 novels for every business book I read. And I was like, why? That doesn't make sense. And he's an entrepreneur, makes a lot of money, does really, really well. He said, Daniel, I learned the steps and the process in the business books. I learned the human psychology of how to implement the steps on the novels. So I need to understand the psychology of the world and the trends to be able to implement the business books correctly. And I thought that was brilliant. Very, very good learning from him. Learning number 3, the S-curve of product life cycles. The products, like companies, grow in stages. You need to understand the stage. If you see every product, it begins going up, then the new technology or a new trend comes in, and then they go down. So they all go in these loops that go up and down. But they all have a loop and they always come down. So how does this look in cash flow? The first line, the one you're seeing today in the computer, that's your breakeven. You haven't invested any money or time in your product and you see a problem or opportunity in the market and you said, there's a problem, there's an opportunity, I'm gonna fix it. So you begin investing time and money in really building that and then you have a full curve. That goes all the way up. So this section is the money that you put in, money and time, and this is all the money and time you got out of your product. So of course, the smallest that this one is compared to this one, the most money you make. And it's always gonna come down and then you have to invent another one. So here's the issues that I see. The mentality that you have here, you have three mentalities. One is the mentality of the entrepreneur that sees a problem and has a mentality of investing and fixing until they have a solution that they could sell one time and next time and next time. And then once you're here, now you have to dedicate on cash flowing the product. A lot of entrepreneurs, once they build a great product, instead of cash flowing, they continue to invest and reinvest and reinvest because they're so excited with their product that they don't see anything but the product. As an example, Sony. When I grew up in the '80s, all the electronics in my house were Sony. Now there's not even one electronics from Sony. Sony were very excited with the technology, they were in love with their products, and they didn't saw the trends and what was coming, and they stopped. As an example, the Walkman. It was a great product. They never saw the digital player coming, and the Walkman went down. If today I say I'm gonna build a great Walkman, Who's gonna buy it? No one, no one even has cassettes. So instead of continuing improving your product, you have to be able to understand what are the trends and what's the next trend coming so you could have, you could go into a next wave and go continue growing. So what do you have to do as an entrepreneur? Whenever you're here, you have to let go of the product, give it to an administration or an integrator that will cash flow the product and you have to do your curve one on top of the other, and then you do another one, another one. The more curves you do, the most money and the more you're able to scale up your company. So let's go back to understand like Microsoft. What's the first S-curve, the blue one? It's Windows. Once they sell you a computer with Windows, then they'll sell you everything on the top, right? Office and Internet Explorer and everything on the top. Same with Apple. Once Apple gives you a product that connects with iTunes, Now you're hooked with iTunes because you bought your movies and your music there. Now you have to have your computer, your iPod, your iPhone, and everything on the Apple Cloud. So as a company, you have to have a product that you get your first clients, and then once you have a client that they trust you, now your role is to give them other products to upsell them and have a bigger relationship with them. So the most successful companies that we see is every stage they're creating a next product, a next product, next product to be able to go to the next stage. And that's how we see the most successful companies growing. All right, and my last learning, learning number 4, if you want to 10x your company, you first have to 10x your team. And not in mentality, not in size, in mentality. And the best way I have to explain it, I learned it from Professor Rao in Stanford, that he says, whenever I ask you, So how are you going to scale up your company? People immediately think in footprint. They say, well, I have 5 stores, I'm gonna have 10 stores. I sell to 1 client, I'm gonna sell to 10 clients. And it's all about the footprint, the physical part. They don't understand the mentality. And really, what really scales companies is mentality. So you have to grow your team and yourself in mentality to be able to scale up. As an example, athletes, train 90% of the time to execute 10% really, really high. In business, we do it the other way around. We really spend 99% of the time executing and just 1% learning. I really, really believe that's a problem. So if you want to 10x your company, you have to first 10x your team. And I love this quote from Richard Branson. My business today is education. And the first question people ask me, "Well, if I train them, they're gonna leave." I'm like, "Yeah, they could leave." So what's the alternative? And then they stay quiet. And I was like, they will stay? And I'm like, yeah, you will stay with really untrained employees. And that's usually what we have. So it's not a selling for my business, but it's reality. That the day I understand that and I realize that, my business start growing. The day I said I need to invest in my team for them to grow, that's when I begin growing my company. And here's, you will really enjoy this learning. When I started the company, I went to interview like 25 CEOs between $10 and $200 million in revenue, and I asked them a lot of questions, but one of the questions was extremely revealing. How much do you spend on you in education a year, the CEO? The minimum number, $25,000 a year. The maximum number, $250,000 a year. And I was like, how can you get to that number? And they said, between my YPO membership and my week in Harvard and my summit and blah blah, I spent $25,000. I was like, wow. Next question, how much do you invest in your team a year? And they begin getting uncomfortable in seat. And the lowest number I heard, it was nothing, of course, but it was usually $100 a year, what I heard, up to $1,000 a year. And I was like, wow, you're willing to invest $100,000, $250,000 in your brain a year, and then you invest $100 in the brain of your team and you expect them to execute correctly. it's really, really hard. So for me, it's extremely important that you train them well enough so they could leave, but you treat them well enough that they don't want to leave and they want to stay. Right.

Chime in there because that's a real key insight that we had as well, particularly with even the way that we're running this summit. When it comes to the Business Systems Summit, we've thought in terms of departments, and the business owner isn't the best person to be putting systems and processes in place. Typically speaking, we actually say they're the worst person to be doing it.

Yes.

And it should be the department head. So it's taking the sessions, getting them into the hands of the department heads, and then having them implement the system. So I know at the Growth Institute, for example, one of our speakers here at the summit was Jack Daly, and he went through his process for sales. And effectively what you have is, in much greater detail, his full and complete thinking around his sales process. Now, if someone takes that deploys it into their business, gives it to the head of their sales and says, hey, follow someone's process here, the best in the industry, right there you get very quick growth. So that's again comes back to this idea of every problem in business is usually a problem with either a system or a lack of systems. So you got to find out what that problem is, find out who's already solved that problem, give it to the right person, typically not the business owner, and then let them deploy.

He's my sales guru. By the way, you have a course with him. But let me go back to this. I think what you said is extremely, extremely important. Huge insight. The other day I was talking with a friend that he takes these pills whenever he's having a long day or a very important day. He takes these pills that help him think faster and better. And I say, well, I'm very natural. I love to eat vegetables and fruit and all that. And I was like, well, why you drink that? And he said, His name is Juan and he said, Juan without the pills against Juan with the pills, like there's no competition. Like Juan with the pills destroys Juan without the pills. For me, the same with the books. Daniel as a sales manager with my knowledge or whatever, or Daniel after reading this and following Jack Daly's on sales management, like the Daniel with Jack Daly here teaching me what to do, like I'm going to be 10 times better than the other Daniel. So for me, having a book like this, like this book by Jack, I think it's like $18. It's $25 list price. You could buy it on Amazon probably for $18. For me, a book is giving you a vault open with gold for you to steal. And you said, no, I don't want to steal it. It's too heavy to carry the gold. There's the gold, just carry it. No, no, it's too heavy. Like they're giving you 30 years of the best sales training ever for $18. And people say like, nah, I don't want to read it. I don't have the time. How can you do that? Like, how can you leave thinking yourself that they gave you this ball of gold and you haven't done it? So for me, huge, huge learning. And Jack, as you said, with the process of sales, and he always says the best sales agent are canned. They give you all the responses, they're already perfectly practiced. You feel that they did it just for you, but they're perfectly, perfectly practiced and tested. Alright, so let me go to this and I have two more slides and we're done. Every employee, they see themselves in four stages. Even your company has 10 levels, they all see themselves in just four stages. The first is the employee, the frontline employee. They don't have anyone that reports to them. They have a boss, but they don't have anyone below them. And you have to teach them on technical know-how to do what they do better. If they do sales, teach them in sales. If they do operations, teach them in operations. Whatever they do, just show them to do better. Focus, very important. Productivity, results, and humbleness or cultural fit. Those are the people touching your clients and doing the work touching the world. You want them to execute with some level of humbleness, of cultural fit. Of what you design. But most importantly, that they do what they do in a very focused way, repetitive way, and just do one thing. Don't train them in anything else. Stage number 2. Here I'm going to say something that is going to sound horrible, but I think it's true. And a friend always tells me this, "Daniel, do not try to teach a pig to sing. You will lose your time and you will annoy the pig." And it's hard. But I have employees in my business and I've had employees many years, they don't want to grow. They want to have a salary, be 9 to 5, they don't care, they like, they already have their number, that's it, don't touch them, don't move them. If you try to move them, they will be annoyed and they will leave. So it's extremely important that you're able to understand which of your employees really want to grow. And the ones that they want to grow, overinvest in them. And the rest, try to help them as much as you can, but don't overinvest in them. If they don't want to grow, you cannot make them grow. Okay, stage number 2, or second level, is when they're first-time managers and they have one level of people below them. Foreman, superintendent, supervisors, and the rest. Now they're going to be leaders for the first time. You have to teach them how to be great listeners, performance and path recognition, high-performance teams and talent development. Now they're learning how to do talent development. And we believe that number 2, they play checkers. Stage number 3, or the third level, they play chess. So what's the difference between a second and a third level employee? So the one that is playing checkers, he sees the board and everyone's exactly the same, and they are the one moving the pieces to win. On the third stage, you see your board and you recognize and understand the weakness and strengths of your team. And you have to put your team on the right position to be able to use their strengths the best and defend their weaknesses. So we really believe it's extremely important that you understand that the second level is playing checkers and the third level is playing chess. And that's the way we talk about training on the positions. So on the third level, identify the right people for the right position. That's playing chess. How to develop other leaders. Now they have to understand who they have to grow, understand a little bit more of the big picture, and predictability skills. And I miss here one— negotiation skills. Most of your supplier contracts are negotiated on the third level. So how can you get your employees to negotiate correctly on that stage or on that level? And then the fourth level C-level executives, VPs, or whatever. It's all about people. We're on the people business, change management, and global vision. And they are going to be also a satellite with you around the day-to-day operations. And this is my second to last slide. This is a picture from a tool by strategic coach Dan Sullivan. I really believe he's one of the best CEOs, CEO coaches around the world. Fantastic. I go to Toronto every quarter for 2 days to learn with him. And one day he gave me this piece of paper, and it's brilliant. I really believe it's very important. People said, I will not do something until I'm confident that I'm going to do it great, and they stay sitting on their sofa waiting for confidence to come. And I was like, come on, like, it's never going to come. You have to look for it. So here's the rule of how you get confidence. First, you have to make a commitment. You have to say, I'm going to solve this by this date. And you have to make a commitment. That commitment will push you to have the courage to change and learn things. Once you have the courage, that will help you build new capabilities, learn new books, learn new processes or procedures, and having those systems or procedures will allow you to have more confidence of execution. So let's go back to Jack and the book. So I'm going to say, hey, I need to double the sales of my business. I want to be a better sales agent. Now I'm going to make a commitment. I'm going to double my revenue next year. That's going to push me to have the courage to read this book because it's going to take me probably 8 hours of reading the book and really going through the process of implementing all this, right? But once I read it and I follow the systems that Jack gave me, that will give me the capability that I need to double my sales. And then I'm going to have the confidence to double my sales. I think it's brilliant. It's a very, very simple piece of paper that Dan gives you, but it tells you exactly the mentality you need to have to go from one stage to the other stage. So my last question is, are you winning? Are you playing to win? Are you playing not to lose? Usually if you play not to lose, you're going to lose. So learn how to play to win. That's it. That's my presentation. Wow.

That was fantastic. And I think some insights there that oftentimes take a lifetime to learn, you kind of compressed it down into one session. And I think the biggest takeaway really for me is figuring out where you are and then understanding what those next steps look like and then to identify the challenges that will get in the way and then seek out the right people. With what you do with the Gazelles Growth Institute, I mean, you're really good at seeking out people because you talked about identifying the book and we talked about Jack. That's a great example. There's also a lot of noise out there in the marketplace and sometimes it's hard to know Well, who do we listen to and where do we get the right system and the process? And that's part of what I know you guys do through the Growth Institute is identifying the people and being a systems thinker, which you can't help but do. You then find the person who solved it in a process type format and goes very deep on a specific topic rather than going very broad. So I don't know if in the final things, I know you grabbed a book there, so you'll probably say something. And then also how people can find out a bit more about what you guys do.

So firstly, there's 1.8 million different titles of business in Amazon. How do you know which one? So the first thing we do is really do the hard work of reading a lot. I probably read 75 to 100 books a year just to really understand which are the books that I have to recommend and record. And then the next thing we do is we go and look for the best thought leaders for mid-market companies and bring them in a price and format that makes sense. As an example, Vern charges like $50,000 to give a lecture. So if you want Vern to coach you, you're going to talk about $200,000. So you see Vern speaking at a summit, you say, "Hey, great, I love it. Vern, come and help me." The minimum he's going to charge is $25,000 a day. Very few companies could afford that. So what we do is we get all of Vern's knowledge and put it into an online program. It's a 20-hour program that we walk you through on how to implement scaling up in this case. This is the book from Vern that you mentioned. For me, this is a CEO system. When I go to a company and say, hey, show me your systems. They show me their accounting system and their operating system and their selling system and whatever. I say, great, what's your CEO system? And they look at me and say, what do you mean? Like, yeah, how do you take decision? How do you take the right decision as the CEO? And they say, well, I just have my meetings and I think when I'm driving and running in my car or whatever. And I just think and I come up with my strategy. Well, no, you need to have a system and a procedure to have the right strategy and implement it correctly. So for me, this is what Scaling Up is the right book for. And what we did is went and recorded 10 hours of Earn, put it on video, and then we walk you through those 10 hours of video with 10 hours of a coach. So you see 1 hour of video and then you have a discussion with a coach. Group coaching calls, and they have 2 one-on-one calls with your coach to be able to walk you how to implement your scaling up. And we've done that with over 100 thought leaders. And we have one of the most complex books. We have some with Peter Diamandis, one hour, Salim Ismail, we have Jack Daly, we have Greg McMillan Business, we have Seth Godin, Malcolm Gladwell, a lot of the really, really big thought leaders, we have class with them and bring them in a pricing format that makes sense. So this is my life dream. I'm building the library that I wish I had when I was building my companies. So that's what we do.

Perfect. What I'm going to do, I'll put all of the details beneath so people can find out. And I know we'll chat with you and we're probably going to do some things beyond this summit further together because it really is the great fit as far as— I mean, we're big lovers of systems and processes, but you have to go to the right source to find the right systems and process. Otherwise, you deploy an ineffective system, and a lot of these thought leaders have solved that problem. They've done this before, as Daniel mentioned right at the start. So why not take someone who solved that problem, deploy that in your business? It's always a great idea to, you know, once you have a deep understanding, you customize it, you make it your own, you really embed it into your organization. But you might as well start, you know, with a really solid foundation. So Daniel, thank you very much for being generous with your time.

Thank you for the invitation and hope I'm able to help. As I told you, our dream is to help a million entrepreneurs grow their companies faster with less drama. People like you are helping us to bring our message. So thank you very, very much for what you do.

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