Lessons And Realizations From January 2025

You're like, what's my life's purpose and how do I guarantee that I'm going to be worth $100 million? And you're like, I don't know, maybe you just build a skill first. How about that?

Because if you summarize, we said this before we hopped on of like, I almost feel stupid learning these lessons because they're so simple.

Sometimes someone can be an underperformer just in the, in the sense that they, they literally don't do the thing that you hired them to do.

Usually signs of not a good long term fit or like long term from now are always present. And anytime you delay that, it's usually a mistake.

The person might be doing the role, but they need constant conversations about like, their reinforcement of a buy in as to why they're there or where they're headed or like what this all means.

A huge incentive with good measurement. It's almost like an exponent. Too foreign. Welcome back to another episode of the Espresso Hour. Wrapping up January, January 31st today, finishing off the first month of 2025. That absolutely flew by. Can't believe that we were in 2024 just a month ago. You say this every year around this time, but it's going to be Christmas before we know it. But good first month. Cheers to that. And I got a nice topo chico for you.

Yeah, Big mountain valley. I had a call today with a guy and I held up my mountain valley and he was like, I'm drinking the same thing. And he held up his mountain valley bottle. So we're spreading the good word.

There you go. I don't think they have that here in Mexico, but we do have this like clay pot, big water filter that's right by the sink that I guess everyone here uses. They put sink water and it has to like filter through this thick clay pot. It's actually delicious water. So it clearly didn't work last week because I got absolutely lit up at some point. But anyway, good month. Excited to jam on our takeaways here.

Yeah, we got, we got a bunch of good stuff to dig into. By the way, I forgot to tell you this. I got my blood work done recently and they go through like your different levels of everything and there's one thing that measures, I guess, your hydration. And they were like, yeah, I don't know, you must drink a lot of water because your level here is really high. And I was like, you have no idea. You have no idea how much water I drink.

Just ask my wife who's got all the bottles laying around the house hates it.

They're everywhere.

They're everywhere. They just accumulate. So. All right, diving into some things we learned. January, I got a list of three that I think will provide some good conversation and we can pick any of them to start the first. I said if an employee requires a lot of emotional management, only keep them if they're a true outlier performer. And said another way, usually signs of not a good long term fit or like long term from now are always present. And anytime you delay that, it's usually a mistake because you could have won back that time earlier on. So that's number one. Number two, what it looks like to have someone absolutely smash their first week with a level of expertise and experience that you've never seen and like operated with. That was the second lesson because we made a hire that showed us that. And then third, performance of any metric is simply measurement times incentives. I originally had plus here, but I think measurement times incentive is required because if either of them is 0, the performance doesn't happen. But when you have both of them, they multiply to on one another. Right. A huge incentive with good measurement. It's almost like an exponent too. But anyway, those are the three. Which one you want to start with?

Let's just go down the list. I mean on, on that first one of like someone's emotional capacity, what they bring to the table, what they bring to the team, things like that. I think, I think it shows up in different ways. So sometimes someone can be an underperformer just in the, in the sense that they, they literally don't do the thing that you hired them to do, you know, and it's, and it's a much more objective sort of conversation. It's like I hired you to move thing A over to thing B. You're not doing it. Why aren't you doing it a different way it shows up. Which I think is more what you meant is the person might be doing the role, but they need constant conversations about like their reinforcement of buy in as to why they're there or where they're headed or like what this all means. I have observed, and you've now certainly gotten your notes of this, that there tends to be a direct correlation between the team members age and the level to which they feel those highs and lows. Not always, but like typically.

Right.

I think my mentor called it early twenties syndrome, where when you're like 23, 24, 25, you just, you're like, what's my life's purpose and how do I guarantee that I'm going to be worth a hundred million dollars? And you're like, I don't know, maybe you just build a skill first. How about that?

I thought that was true and I think it was kind of true. But we had some counter examples this month.

Yeah.

And I almost think a better way is it's a function of who they're comparing themselves to. And you. It's almost like a really good hiring question is like if who are you comparing your income to right now? Or who are you comparing your role to? Or who are you comparing X, Y and Z to? Because it's usually not that they're disappointed in the objective thing going on that's requiring a lot of this emotional management of like, oh, is this gonna improve or what's gonna happen over the next two weeks or whatever. It's like there's some external comparison that they have either to like a goal that they don't understand what goes into achieving or the milestones to get there, or there's some either fictional or real person that they're benchmarking themselves to. And every day that they're not closer there, they're like they feel this big anxious, just overwhelm. And so I think that's almost the better measure of it. And you can get away with that if you're performing very well because it's like, okay, let's have this conversation because here's your trajectory and here's what's going on. But if you're just like an average performer and you're having these freakouts or having like just a constant questioning of everything going on, the amount of effort that it takes to manage someone like that spread out across three or four months, which is usually in my experience what I have had happen in terms of like dragging it out. If you spot it early on, you could then have reinvested that same time into someone else that will have buy in and long term alignment from the start.

Yep. Yeah, totally agree. I mean it makes me think of two things. One is the same way that I love how Hormozy talks about bundled terms. I think the same applies to bundled goals where people have say that they want to achieve something or pick, pick an income number or want to achieve a certain level of status or whatever. But oftentimes those goals are bundled in the sense that the person doesn't actually know what is required in order to get there. And so what happens is you compare yourself to not the next milestone, but the bundled goal which almost Creates this like vicious loop of I'm constantly let down because I'm not, I'm not at the final goal yet. And it's like, well, no, like, yeah, you can know where you're going, but really the next most important thing is like achieve the thing right in front of you. It's the same, same reason why everyone wants to know how to make a million dollars before they can understand how to make a thousand dollars. It's like, you know, one, one leads to the other.

And we're guilty of this too in terms of setting like milestone business goals and thinking that because we set the goal there, it requires us to like, like if we set a goal of a consistent million and think that we have to do it in five different ways at 200 rather than if you say the goal is a million, we're at five now, whatever, this month. Not saying that's like our exact example, but saying that the next milestone was 6. You would then look at, okay, I could easily get this same vehicle there.

Mm.

And then once you're there, oh, I could easily get that same vehicle to seven. And it's like if you just like discretized where you're trying to go, you would have less like overall, I gotta have all these different pots spinning at the same time trying to make it happen.

I agree. We're just as guilty of time.

Plates. Yeah, Pots boiling.

Plates spinning. Pots boiling. You know, the kitchen's Friday, the last.

End of the month.

The, the other thing on this note, and I've been thinking about this quite a bit lately, is whether you're building a company yourself or you're working within a company, or you're building a department within a company, or you're a solopreneur. It all doesn't really matter. It's the same fundamental thing, which is the through line that I observe in every person who struggles at any level is a skill deficit in being able to manage their own psychology. I see it with friends who have one person businesses. I see it with startup founders who are trying to raise $100 million for their series C. I see it with department heads that are trying to build something within a huge company. I see it at every level. And I think something that really doesn't get talked about enough in the world of business is how much the skill of managing your own psychology is 50% or more of the whole game. Like everyone puts so much emphasis on like the hard skill side. You know, do you know how to build this? Do you know how to code? Do you Know how to write? Do you know how to. Like it's always the hard skill but in reality the thing that causes you to make the most mistakes is when you run into a little bit of friction or, or number go down for a month, you know, and you, you don't have the skill or the, or the conscious awareness to manage your own psychology through that, that you end up making these emotional short sighted decisions that you know, it's like you just ruined compounding. You just decided to, you know, you got freaked out and you decided to go do something different. And I just am starting to observe that pattern so much. And I've been trying to think like what are better ways that I can articulate that to other people. That your emotional state and your psychological state, it's not, it's not this passive thing that just happens. It is a skill. You have to learn how to manage your own psychology.

You almost have to invert it where it's like what are the things that make me extremely overwhelmed or volatile or whatever. And you have to, and I've been using this for a lot of different weight places in my life right now. But you have to role play your reaction in advance and so you have to be prepared and almost spend time. So I've been back on a meditation habit trying to get like 20 to 40 minutes in each morning right now. And I don't do the same type of thing every day. But some days I'll do like a cool hypnosis on Spotify, some names, I'll just sit with my thoughts. Sometimes I'll do like a gratitude, but sometimes I'll also just pick like a behavior or a situation and role play what I really want to do in that situation and then get reps at that because it's the only way we expect that like we're going to build up this ability to handle stress in real time without any kind of practice for it. And then obviously when you actually get there it's like, oh shit, I'm overwhelmed. And I think that has been a nice insight for me.

Yep, that's exactly right. And learning very tangibly, what are the things that trigger you? How can you proactively get ahead of those triggers and knowing inevitably that some things will trigger you and learning what are the things that help you stay calm in those situations. Fundamentally, I think this is why so, so few people end up really wanting to do true entrepreneurship over the long term. Because the challenge of managing your own psychology, no matter what you do, is challenging. Doing it while building something where you're responsible for everyone else, and everyone else's psychology is like, a completely different sort of burden. And I think that that's why most people don't do it. But, like, I'll give you a really tangible one. I've learned over the years that my psychology is more volatile when I don't have, like, 5%, 10% of my net worth in just cash just sitting there. If I'm 100% allocated, even if everything's going well, there's, like, a part of my brain that is like, I'm vulnerable. And it's like, when you learn those triggers about yourself, you have to just go, for whatever reason, that is a trigger for me. I'm gonna make decisions accordingly that manage that psychology here.

Have you ever. You've probably looked at it, but, like, as I was putting this video together, our lifetime stripe chart is actually a. Yeah, A hilarious thing to look at because I. I said in the video, like, why I'm making this video is because here's my life to date chart, and it's going in one direction linearly like this. But I want to document these and these. Yeah, I want to have videos going for when it's the best thing that's ever happened. And there's, like, four points on this graph that look like the business was dying straight up dead. And It's. It was August 21st, June 22nd, when we got together in Miami. April 2023. This is April 2024. And then here's where we are right now. And each time, if you just plot the single graph through, it's going in one direction, which is great, but it does not feel that way until you can look back on it.

And it's like.

Yeah, it's like it's just going in one direction. The swings get bigger. And that was why, like, one of my lessons from last year. What are the things we're getting comfortable with? Things that scale linearly, but fuel worse exponentially. And so the. In the beginning, like, the difference between 100k month, a 50k month in a 150 is only like 100 grand, but that's 100%. But it feels way worse to swing from 1.5 million, 1 million 500k because the aggregate number is linear, but it scales exponentially worse. And so as I was looking at this chart, I was like, man, this is what building a business looks like. And if you can't stomach the fact that we have bounced off the low significantly every single time, it's not for you.

Yeah. And it's not for you on the macro level and it's not for you on the micro level. You know, like even, even within the business you have to be okay knowing that there are highs and lows, there's busy periods and slow periods. I remember when we first started building PGA like early days and, and we were just setting up our call booking system and getting calls on the calendar and we had just hired our first two closers and I remember telling them, I was like, enjoy the fact that you feel like you have a light calendar right now because I guarantee you next month you're going to be so packed that you're going to say the opposite and you're going to be like, I'm so overworked, I'm burned out. And that's the irony is like when things are slow you want them to go fast and when things go fast you actually want them to slow down. And that's why so much about this game I've learned is about figuring out what those triggers are and managing your own psychology.

I think we've both taken, I know personally, I have this month especially like my emotional reactivity to a lot of the things and it's also correlated to like the amount of skill you have on your team, which leads us perfectly into the second bullet of what it looks like to have a hire absolutely smash their first week. So for context, we hired a sales manager, Casper, who's an absolute killer, comes from a company who has done 30 plus million dollars in revenue and he played a very significant role in building their sales team. And this, this is the first hire of someone who has built something or at least a department to a much higher level than we have in another business, right. And so it makes sense when he comes in and it's like, here's day one things I did what he did on Saturday, right? So I think unbundling exactly why we're sitting here like this, we feel so strong and a hire is just like a sale and that then you have to reinforce to them and they have to immediately reinforce to you the decision that they just made. It's like a very clear two way sale. So he hit the ground running, made the offer to him on Friday night. Saturday he's up until midnight his time over in Poland, going through the materials, getting onboarded immediately gets in slack, sends like a good motivational selfie video to the whole team. Sends me his calendar on Sunday for Monday, 8am to midnight. Booked out with either like training, his own training and morning stuff, team meetings, one on Ones with the entire team that's reporting to him with a very clear, here's what I'm doing tomorrow. And every day this week, he hit me with the beginning of day report. Here's what I'm working on, here's who I'm meeting with. End of day report. Here's what happened, here's what's going on. Just want to over communicate and keep you in the loop, either through a voice note or through a. Or through just a text breakdown. And that was like the. It's funny, Sammy sitting here yesterday. She's like, you seem at ease. I'm like, I just feel that I just made the best hire I've ever made. And that was why I felt that way. It's like, okay, I feel that this is secured, this department. And that's a great feeling.

Yeah. Couple. Couple of things to double click on. One is I was extremely impressed that the offer was made Friday night. It was accepted Friday night or Saturday morning, and then he was already dropping a welcome video Saturday morning, like that especially. And we didn't even ask him to do that. He just did it. Like, extreme ownership. So there's a couple of things in that. So one is I've really learned that how people communicate with you at the beginning of the relationship is how they're going to communicate with you through the entirety of the relationship. So is point a. So speed turnaround, respectfulness of time, attention to detail. Right. Like, whatever you see in the beginning, that's what it's probably going to be in the entirety. Second is, this is a pro hiring slash. If you take a role. Pro tip for anyone here. I always notice whether or not people work the first weekend, like, obviously that's not an expectation. And I. And we aren't, you know, it's like you have your own life and we don't expect you to work seven days a week, ten hours a day. But I always find it extremely indicative when you hire someone, especially on like a Wednesday, Thursday, Friday, and then they're like, cool, I'll get up and running on Monday. And it's like, sure, no problem. But some part of me is observing the fact that you don't feel a sense of urgency and that you don't feel this like, extreme ownership, like a dog going after a bone. Like, I want to see. I want people, even if it's just the first weekend, just literally one week out of your life, I want to see someone be like, you gave me an opportunity and I'm going to run through a brick wall. To get up to speed as quickly as possible. And that's that when I saw that I was like, we picked the right person. That that is amazing.

I agree. And that type of communication only compounds. Right. If it's that good from the beginning, like you said, it's going to improve throughout. And if it's shaky in the beginning and we have examples of this across the board, it only gets worse.

Yeah.

And so I feel good about that. And just it reinforced the amount of effort that went into the hire and the number of interviews and blocking out. Basically that was the only thing I really felt that needed to happen this month because of the downstream impact it would have across the board everywhere else. And now that is going to lead to me kind of deploying efforts on whatever is the highest leverage thing from a place of security in that department. And that's the most important department to have secured is sales. Right. Because they are the gatekeepers of the money. And having that set up is good.

We talked about it on the last espresso hour, I think. But I keep thinking about that hormozy ism from when we were in Vegas on the theoretical constraint of the business is the sum total of knowledge. And this has really shown me how true that is too. Where just by hiring someone who knows more than both of us in a specific vertical and has executed seen it in a similar business 10 times bigger than ours, you can see how much like you're not just hiring someone to take over or manage a department in many ways they become this internal consultant being like, let me tell you what what happens from here. And then let's reverse engineer that. And we've also never had that before. And what a cool feeling.

And it's only possible by doing all the pieces ourselves that we did. Because he would not have looked at this opportunity last year been interested. Right. And so I made this point in the video that I just made breaking down the org chart and the KPIs and it's like I'm only making this video because it's the first time in like 18 months that I'm not one of these like department head roles. And therefore I am able to think this way because I have people aligned on making each of these numbers go up such that I can deploy effort into whatever the constraint is at any given time. But before that it was there was always a trade off in where my effort went. Right. If I did more here, it meant suffering of this particular thing because just you only have so much attention. And that was I why I'm loving making these videos is I have these little aha moments to myself too. I'm like, oh. As I said that out loud, I was like, that's awesome. Right. This is the first time that there's not a trade off in that. And I'm excited to see where that goes to.

Yep, I agree. What was your third bullet?

The performance equals measurement times incentives.

Oh, yeah. So this is a cool thing. You want to share where this came from?

So this came from. We set a goal for our success department to generate a certain amount of backend revenue as a unit. And so this is really the first. We're not even there, to be honest. Goal of having the whole team selling the back end. We only had half of the team selling the back end. So it's really good to see. But we set a goal and then incentivize the entire team on reaching that goal or not. We set it in December as well, but just didn't have the pieces in place or people weren't really making those decisions at the end of the year. But we did a couple very simple things. Number one was creating the leaderboard such that everyone knew the number that we were optimizing for. We simplified everyone's beginning of day reports so they stared at their individual contribution to that number, such that that number is simply a sum total of all the individual contributors numbers. Great spot to be in terms of alignment. Every single person there is compensated on their individual contribution and the team's overall performance. And so having those three pieces in place, one staring at it every. Staring at it every single day to each individual being compensated on their performance. And then three, a bonus compensation on the entire team hitting their goal. We ended up smashing it. And it led to a new sense of like team camaraderie and effort to hit that number. Something that we hadn't seen from that department before.

Yep. Yeah. Once again, whatever is the priority grows. And I had slacked you this, but you know that that's like the opening insight that Arnold puts in his encyclopedia. Arnold Schwarzenegger. Because he. I remember reading that book when I was in my early 20s and somewhere early on he basically is like, everyone asked me how I grew my calves because I didn't have calves. Like, I didn't. I was not naturally born with huge calves and I had to develop them. And he called it the priority principle, which is every day when he would go to the gym, he would start by doing, you know, 100 calf raises or 200 calf raises or whatever. And that's Always stuck with me. Now, I didn't do that with my calves. My calves lack the priority principle. But, like, you get the point. And. And this past month was so indicative of that. Where literally every day we would wake up being like, where's liftoff revenue? Where is it, where is it, where is it, where is it, where is it? And after saying it 10, 15, 20 times, everyone starts to realize that we're not gonna stop saying it. You might as well just figure out how to do it.

You know, it was the first. It took about 15 times. And that was where we'd probably gone wrong in the past. When you set any kind of priority, it's like you only make it a priority through unbelievable amounts of repetition.

Yep.

Because otherwise it's a flash in the pan. You know, it's like this. Oh, but the 12 other things. And I think we are doing a better job this year of that prioritization. Like, just putting that document together that I did yesterday of like, what is actually number one of everyone on the team. Every department's priority list, aside from I stack, ranked all the things that are ongoing parts of the business that we must keep doing on top of all the other things. And then our goal and our job right now is holding each department head accountable to moving those things forward, showing them how to incentivize their team to move those things forward, and then deploying our effort on wherever is most needed to move that part forward.

Yep.

And I think just it's going to get so repetitive of like, is that the number one thing right now? No. Discretionary effort does not go there. And then keeping that top of mind. And it's difficult because how I put it in this video, breaking down, like, for the first time, we've actually picked one project, moved it forward a ton rather than a little bit on five. And it's because in the first week of doing that, you feel like you're moving a lot slower, but over three months, you move three or four times as fast. Right. Because it's your end of week report. When you have five projects that you move forward a little bit, you get to comment on each of them, but when you only do one, it's like, I move this one thing forward four steps rather than these four things forward one step, it feels worse in that month or in that week, but over three months you go boom, boom, boom, rather than all of them very slowly move forward. And then ultimately, like, this one falls off, that one falls off. And we probably. Everything that your team does is simply a mirror of you or something that you've done at some point. Right. And so, because when I started to work more closely with the different department heads and have them report their projects back, they reported their things similar to how I report projects, which is, here are the five that I moved forward. And so it came back to me. I was like, that's. That's my fault that it's coming back that way. What is number one? Okay, I must now speak in that same way and take that and set that standard across my own life as well.

Yep. This is why all roads lead back to building a skill of managing your own psychology. Because the clarity of that and the discipline of that inherently means less shiny objects, which inherently means an increased feeling of boredom or wow, like, am I not doing enough? And then you have to manage the psychology that comes with that, you know? And that's. That's why so. And exactly what you just said, like, if we can't do that, then we pass that down to department heads who pass that down. It becomes. It becomes toxic to the whole thing. And so, yeah, I keep using this metaphor whenever we talk, but I feel like the process of this is you have these grooves in your brain, and you're like, this is how I think. And you just go in those same grooves over and over and over again. And then as you grow and hit new levels, you have to build new grooves. And so in the beginning, making these decisions these different ways feels taxing because you're like, well, I could very easily think about it in the old way. That's where the groove is. But I have to pause, stop, build a new groove in my brain and get myself used to this instead. And I can feel us going through that process, and it's.

It doesn't get any easier. You have to just keep going down that new groove. Because if you summarize, we said this before, we hopped on of, like, I almost feel stupid learning these lessons because they're so simple. But like, summarizing these three lessons, if an employee's not it at the very beginning, they're probably not it over the long term. Like, you can't fix things unless they are absolute stars. And even that, it might not even be worth it to hire really smart people who. And pay them well. And then number three is incentivize the thing that you want approved. It just doesn't get any simpler than those. And we are going to continue learning those, but luckily we're learning them at a much higher revenue level than we have in the past. And ultimately I think that's the game of business is reinforcing the same exact things that you know already, but at a different level of significance. And so we'll probably learn this one again three or four, you know, years down the road. Two years down the road when we've double tripled 5x from here.

We definitely will. It's the same lesson in different context.

Which is why also this filming espresso hour is a nice forcing function because we're getting back to crystallizing some of these things that hopefully we don't end up forgetting next month as we head into February.

Yeah, that's true. That's a great point. Because each week, if we say the same thing multiple times, we're like, okay, why aren't we learning this lesson just right? You know, figure it out. So, yeah, this is a nice container.

And that wraps up this week. This is the end of January. Great. First month of the year. This probably come out in a couple of weeks. Hopefully we can speed up the feedback loop of when these are released so it's a little bit more in real time. But that's all I got.

We're going back to Vegas in six weeks.

Six weeks. Yeah, I know, I know. I think I got a bachelor party in Houston the week before, so I got to figure out how to. If I'm gonna stay, go. Good luck time in Vegas. Who knows? Who knows? But other than that, man, Mexico City, good spot. I gotta show you the sushi place I went this weekend. It was on top of the Ritz, the highest place in Mexico City. 56 floor, looking over the entire city. Sunset and just Wu sashimi.

The best. Unbelievable. Un.

Absolutely unbelievable. Is that plus, like lettuce wrap, short rip tacos, choro. You. You would have been a massive fan. So get out here because we'll be back for sure. It. It is. It is a creme de la creme. And for anyone who knows how I pick restaurants, the Google review is the key. And this was a 4.9 on Google review with 8, 000 reviews.

Oh, wow.

And it. It was evident the second we got there. This. The people, the service, the staff, everything just absolutely absurd. So I'll. I'll send you the picture of the way it was. It was. It was epic.

That's amazing. The wagyu sushi we had in Vegas was pretty 10 out of 10 too, with the little. They put caviar on top with like little gold flakes. Oh, it's awesome.

So good, so good. But all right, that wraps up this week. We'll see everyone back here next week as we continue to document 2025 and the entire path to get to 10 million and beyond. Have a great week, y'. All. Peace.

See everyone.