Overprioritizing Your Business, Setting Boundaries, and Finding Balance with Carlos Hidalgo

All right, welcome back to Agency Journey. I am your host Gray MacKenzie from Zen Pilot. And this week I've got the pleasure of bringing on Carlos Hidalgo from Digital Exhaust and a bunch of other fun experiences which we'll dive into here on the podcast today. But, Carlos, thanks for joining me.

Great. Thanks for having me. It's. It's great. I apologize. Before we came on, I congratulated you on a big Steeler win, only to find out you're a Browns fan.

Hey, I don't. I don't admit that publicly, so I'm gonna have to straighten. No, I'm just kidding.

I.

The. Really the only thing you can say about being a Browns fan for as long as I. And the period that I have. So I got into. I told you this. I. I got into it around 1314. So it was like the Browns just coming back to Cleveland. You know, I was familiar with them. Then they left, then they were just coming back. And so, you know, I've. I guess my claim to fame is like I've seen more quarterbacks in my short tenure than pretty much any other franchise fan.

Yeah.

Has seen over the. Well, over any time span, really. There's so many, so many quarterbacks in Browns recent, recent stint of history. So speaking of turnover, you've worked in a few different. A few different agencies and are now running Digital Exhaust. But can we work kind of from the present day and then we'll go backwards a little bit? What is Digital Exhaust and what are you. What, what are your goals? What are you trying to build? Yeah.

Digital Exhaust is a growth consultancy. We work with both B2C and B2B companies. And our belief is that the way you grow is to drive engagement at every stage of a customer life cycle. The way we get to that is by using our clients customer data and our AI and machine learning tools to quickly generate insights on who their customers are, how they move through their journey, what's important to them, who's involved, and then we create engagement strategies that drive growth for our clients.

When you say AI tools, are you talking about tools that are proprietary? Like, hey, we've built this tech or tools that you've assembled at a tech stack to make work for your clients.

It's a little bit of both of what we've done from a proprietary perspective and then what we have partnerships with and who we work with, and it's both on the generative side as well as on the data side.

Yeah, that makes sense. I was just having this conversation. I was up at Inbound in Boston a couple weeks ago and had a lot of conversations with folks. Obviously AI is like 75% of the conference track, it felt like, but a lot of conversations with folks around how they're feeding data into generative AI tools and just realizing like there's a huge, you know, most folks are not also considering what are the legal implications of this or what's the confidentiality stuff that we've agreed to with clients that we're now violating without even thinking about it as we're throwing stuff into a system.

Gotta be very, very careful with that. I was having a similar conversation yesterday on things like copyright infringement and it's one of the conversations we have with clients all the time, of course is how are you going to protect my data?

Right. So if we go backwards though, you've been in the agency space or in and around the agency space since I think you said 2005, what does that journey look like?

I wish I could say it was linear and totally upward.

Sure. Nobody says though, we're going back.

I was actually the CRO for a smaller agency, had a short but what I would deem as a pretty successful run of three consecutive quarters of overachievement and record setting bookings goals immediately before that I just ran my own one man band with some partners agency called Vismcx. And that came right on the heels of In 2005 I left my corporate job at BMC Software & Co founded a consultancy and an agency called Annuitus which is still running today. I ran that for about 12 years as the CEO, was really proud of some of the accomplishments we achieved and then in 2016 announced my resignation from that organization just in an effort to get my life back. At that point I had, as I was sharing with you briefly before we started to record, I bought into this idea that you had to sacrifice everything you had to kill yourself for growth. And it cost me dearly. I made some really poor decisions and I just realized at the end of 2016 I had to put all of that behind me and really start fresh and first work on me, get back to who God created me to be so that I could perform in all facets of life, even as a business owner, better. And I'm glad to say that I took that time and here I am today and I'm still swinging.

Yeah. All right. I'm going to ask the most uncomfortable question which I'm not naturally good at, but I've learned just lean in. Anytime you say poor decisions, people want to know like what does that mean? Is that working too much? So to whatever degree you're comfortable sharing, sure. Can you walk us through what some of that looked like?

Well, you won't be the first podcast I shared it on, so. Wrote a book about it in 2019 called the UN American Dream and, and detailed, chronicled a lot of my. My poor decisions. Number one was just making my business the center point in that regard. I walked away from my faith and really looked to my business. And I find that so many of us in the professional world find our identity and our purpose and our jobs. I think it's a wonderful place to apply our purpose. I think it's a horrible place to find it.

Right.

So I swapped those two things and that was definitely a bad choice. As part of that, that unrelenting drive for success, which really was about ego for me, I neglected my family. I had at the start of 2005, you know, I had four small children, an amazing wife. I was traveling all over the place. And initially I had started the agency so I could be home more. And then as we started to grow and find success, I got sucked back in because it was mine as at that point. And I deluded myself to say, hey, I'm doing this all for my family.

Right.

And then I stepped out on my marriage as well. And again, that had a lot to do with ego. Thankfully, I have a wife who's amazing. So we talk about being in our second marriage, but to same but very different people. And I serve a God who's in the business of restoration.

Yeah. Yeah. Wow. Well, I appreciate you sharing that. It feels like you are like, this is a really timely conversation. I've got four young kids at home. I'm running, you know, a business that's had, say, more success over the last couple of years since getting more focused than for a while earlier and so easy to get lost. And that's not like a one time thing to realize, hey, where is my identity? And performance and identity are so easily commingled and tied together in our brains. So I appreciate you sharing that. That's awesome. Obviously, hearing, hey, I made these decisions that I don't like is helpful to hear, but really the lessons are like, well, what's different this time around? So digital exhaust. What's. What are you taking? What are you applying? What looks different today?

Yeah, first of all, I'm not doing it by myself. I was never doing any of this by myself. First and foremost, my wife is my most trusted business advisor and life advisor. And there's often times where she will Listen in the background to calls and then I'll ask her after. So what did you think about that? She's incredibly perceptive. But when I say I'm not doing this alone, I have a trusted partner. So my partner, Tracy Thain, he and I have more than a decade relationship and I can honestly say he's a kindred spirit. We think very differently and how we process information, but we get each other. We're not afraid to have hard conversations. And then before we even started, we said, let, let's really define what we want.

Yeah.

And first and foremost our, our prevailing statement is we want to do cool things with cool people. And that was put to the test immediately when we started the agency where we ended up walking away from a close to a quarter of a million dollar contract that was in our hands. It was non competitive, everything looked great. And then at the 11th hour, there was just a lot of different red flags and we got together and said, all right, how much do we mean? How much do we believe in what we're saying? Cool things with cool people.

Right.

And we just emailed them and said, hey, we need to withdraw. We're not going to pursue this not the way you want to start a business. But we held so firmly to that. So I think really holding firm to our convictions is one number two is we've defined what we want. We don't need to build an empire. We're not always looking for this, you know, gotta, gotta do better next year, gotta grow next year. Obviously all those things are good and there's nothing wrong with that. But what we said is what is the kind of we started with, what are the lives that we want to lead? What do those look like? I'm an empty nester now. So, you know, myself and my wife, we love to travel, we love experience. So we said, what do we need to build in order to support that life? And really started to ask the question, how much is enough? And based on that, we know what we have to do each and every year. And we also know what we're not willing to do, which is equally as important.

Yeah, what are some of those parameters? When I talk to folks who have some of those boundaries in place, sometimes it's X hours of work per week, sometimes it's, hey, I don't want to grow above this headcount, which I find usually changes as, as folks grow and you're like, hey, actually there's nothing wrong with having X number of people. But are there like, what are the helpful boundary lines or constraints for you around that or is it more principles based?

It's more principles based. So I went through an exercise a number of years ago where I really define what are the things that I value the most in my life. It was surprising to me and as I ask others to do it, it's surprising to them at truly how few like these are mountains you're willing to die on that we all have. And what I realized was there's just not a lot. Number one is my faith. Number two is my marriage. Number three are my kids. Four is my health, my mental, spiritual, emotional and physical health. And probably at 5, maybe 6 is my work. Now that's not to say I don't value work, it just means comparatively. So I have set boundaries around that. And now I have a routine that I pretty much follow each and every day. So I don't say, hey, I'm only going to work X number of hours each week because there's some weeks I may have to work more, but how do I make allowance for that? And then that's a discussion that my wife and I have. So last night's a perfect example. I work, we work with a partner and I got a text and he said, are you available at 8:15? Normally I'm not available. In this case we had a discussion and she said, you know what, take the call. You guys have been trying to get in touch with each other. So we ended up spending 30 minutes on the call. That is a lot different than me just making that decision, moving that boundary arbitrarily. It's a discussion. I'm involving my closest business and life advisor in that chat. And so that's a boundary that I was able to shift at the same time. Hunting season's right around the corner here in the Adirondacks. There's probably going to be more than one occasion where at 3 o' clock I'm out in the woods, right. And I'm not on my phone, but I may come back at 6:30 and make sure that all the loose ends are tied up. So it's those types of things of putting those boundaries around what I love, what I value, making time for that. And I do that so I can bring the best of myself to each of those areas in my life.

Yep. Right. So I think, you know, our entire business is built around kind of the power of process and bringing that organization and clarity to teams and teaching teams. Clarity is kindness, giving people a clear picture of why are we doing this, what's the desired outcome, how do we do this like that just articulating expectations clearly is big. And that creates, that structure, creates the freedom for people to really thrive. Yeah, you're describing the same type of hey, I've got some boundary conditions and that creates the freedom for me to thrive. But to a number of people listening for the first time, it sounds like boundary conditions. And what is the, what does the thriving part look like? So what is better? If you're trying to sell somebody on the benefits of hey, don't be married to your work. Here's, here's the reasons for it. How do you kind of paint that picture of here's what's better about life this time around versus the first time around?

The benefits are, are enormous for me, I would say first and foremost, you know, I wish I could just have people follow me around and do a compare contrast. Number one, I'm just more joyful and you know, I cleared a lot of rubbish out of my life and out of my head to get to that point. But you know, I spend time, meaningful time every day with my wife. And one of the boundaries we have is every morning we have coffee together and we don't have our phones. We're not, we're not sitting, but distant, we're engaging, we're talking. I set aside time every morning in my quiet with some, with some additional coffee to study the Bible because I want to know what God has in store for me that day. I do set aside time for my work. So pretty much from 8:30 to 5 or 5:30, sometimes 6 are my working hours. Now that's not to say I don't put anything else in there during that time. I try to get in a workout, you know, five days a week. So I have that. So people go, oh, I don't do regimented, believe me, I'm not a regimented guy. I'm, I'm, I'm like the poster child for add. But I do find that routine is something that we crave and it actually is something that helps me become more productive. So the other big thing I've adopted is working within my ultradian rhythms. And there, there's some great writing out there, but all of us are wired just as a human condition where we can only go really hard mentally for 90 to 120 minutes tops. Then we start to work from a deficit. And what I do is I work in sprints. So I'll take 90 to 120 minutes, I'll buckle down, I'll get stuff done, work on some deliverables, read some research whatever that work is in front of me. And then I take a break. I'll go make something, I'll go talk with my wife, I'll do a workout. It allows me to refresh my brain. I get more done in less time with better quality than I ever did when I was doing 14, 16 hour days. And it allows me time to do the other things that I love, spend time with my wife, get out on the lake, be outside, get in the woods, go for a hike. It just makes life better. And our work is noble and we should work hard, but there's so much more to it. And like I asked a colleague who was telling me, you know, he was working 18 hour days, my response was, for what? You know, there's no pockets in a shroud. You can't take it with you. So rather than live to work, work to live, design the life you want and build your business around that and stop looking at what everybody else is doing.

That's awesome. I should, I probably should have prefaced it with this, but you did a really good job of commun. Articulating the upside. I think you and I would probably both agree that regardless of what the outcome, regardless of the results, like, even if life is worse this way, if we're convicted, that it's the right way to live. Like that has its own reward of doing, following our convictions and beliefs around what we ought to be doing. But for the folks who maybe don't share the same convictions, I think the point that I wanted to hit on there is there are all these benefits that come from, like there are short term benefits as well as long term benefits that come from this.

And so, yeah, and again, I'm not going to begrudge anybody who says, well, I am going to work 18 hours a day if that's what they and their significant other, if there is one, have agreed to. I'm not going to sit here and tell you you're wrong. I'm just not signing up for it.

Right, Right.

So again, like my wife has said, you know, now it's a conversation, not a mandate.

Yeah.

And you know, I do read about entrepreneurs and you know, I follow a lot of agency owners on LinkedIn who talk about all the sacrifice and I'm like, no, the ones who are sacrificing are the ones who are getting all of us. We haven't asked their permission for that. We're just selfish.

Yeah. Easy trap to fall into for any, any, it's not even just entrepreneurs, but certainly for any entrepreneur that's that's part of the journey. As you look at kind of what does the next year hold for digital exhaust? What are you and your partner and team leading into? Is it, hey, we gotta just execute the playbook that we currently have? Is it we're working on new product offerings or new service offerings? What is that? What are the most exciting things on the horizon?

Yeah, it's a little bit of both. Right. I'm a big for right or for wrong. I'm a big fan of trying to bootstrap and keep as much control as possible. So we are working on some new product offerings both on the services side and the software side. We are looking to really execute with our clients. We're really excited about what we're seeing and the conversations we're having with organizations. We're excited about expanding our skill set and expanding our team is based on the clientele and the new business we're bringing on. We're going to be forced to expand our team and so I'm looking forward to seeing what does this all look like in a year. We've got some plans on paper, but as you well know, it all comes down to the execution and then staying true to cool things with cool people. So that includes our customers, our team members, our partners. Partners. And so the conversations we've had, I would say probably in the last 60 days and we just started in May, so we're still really new. You know, the last 60, 90 days have given us a lot of excitement to say we're kind of dialed into the right things, but we're not married to them so much. Where we're not, you know, we're going to be able to pivot if, if and when needed.

That's awesome. I've got two questions that I love to throw at people as we wrap up. One is any favorite tools or service providers that you're using in the agency in the day to day right now?

I would say because we're remote and this may sound so lame, Slack is something that we just use continually to communicate, to engage with people. We have, I'm in New York, we have folks in Colorado, Boston. My partner is in Utah, Our head of tech is in Utah. So using that just as a communication channel is huge. And of course there's a plethora of AI tools that probably we're all using everything from Otter to writer to ChatGPT to Jasper. You know, there's a million of those that we could just go down those lists. But for just internal communication and efficiency, I would say Slack is probably my favorite.

Yeah. And then the other question I always ask is, what's your number one tip for agency operators? But I'm going to tweak this a little bit because I feel like your story of setting clear boundaries and making decisions about what are really the trade offs that I want to accept and what are the trade offs that I'm unwilling to accept. So if that's off the table as your number one tip, this is really what's your number two tip for agency operators?

You know, you alluded to it. I would say really get clear on your goals and your expectations. And part of that is define what you're not willing to do. You know, I find that everybody wanted to talk about, oh, we're willing to do this. What are the things you're not willing to do? Things like, hey, are there certain industries we refuse to work with? Are there certain types of organizations that we just know aren't a good fit? I would say that I know you asked for one. I'm going to give another one is resist the urge to try to be all things to all people. I found more value in developing really solid partnerships with other agencies that deliver value. And I think if you can do that and do that well and stay in your swim lanes, it really allows you to focus and I hate the word niche, but kind of niche in. Into what you're doing. And when you get that and get your team, like you said, clarity is kindness. If you can get that, I think you're going to see that you're going to grow. You're going to get really good at doing a few things, but better than anybody rather than a lot of things. Just mediocre.

I think both of those are really good tips. Carlos, I appreciate you being willing to be vulnerable and come on and share your story. You mentioned the book the UN American Dream. Is there anywhere else you'd point people to follow along here in your third agency go round?

Yeah, I must be a glutton for punishment. I'm Most active on LinkedIn. I try to post multiple times a day. I do engage with anybody. I'm not as great at looking at my InMail, probably because it's so full of spam these days, but I do try to engage pretty regularly on that platform. All the other social media I've kind of weaned myself off of just because I don't have the time. And if I do go on X or Twitter, whatever it's called these days, it's more just for the amusement of commentary from different snarky people, but LinkedIn is the best way. Or just email me@carlos digitalexhaust co awesome.

Well, Carlos, thanks for joining us today on Agency Journey Gray.

Really appreciate it. Thank you.