Micro CEOs: The Future of Agile Business Teams

Hey everybody, welcome to another episode of the Business Lunch Podcast with your host Ryan Deiss and me, Roland Frasier. Welcome to the podcast, Ryan. How you doing today?

So good. What the heck are we talking about today?

So you sent me over a bunch of topics and the one that I liked, let me pull up what you sent me, said, uh, stop hiring A-players, hire owners. Um, and then, uh, to talk a little bit about the micro CEO shift. Um, which you wrote about, I don't know, 20 years ago, I think, um, versus the A-player gospel. Um, and so basically I'd like to talk about that, like, um, maybe start with the thing that we talk about, um, that you in particular talk about with like, just hire an A-player and everything's going to be fixed. Let's start there and then talk about— Yeah.

I mean, it's great advice.

That, that philosophy, is it right? Is it wrong? Then is it the A-player? Like if you have the business that justifies hiring the A-player, um, is that always the right thing to do? Um, and then what are the alternatives? How about that?

Sure. Yeah. So I mean, in terms of the A-player thing, I hate it's, it's fortune cookie wisdom. I hate advice like that because it's, it's right, but it's unhelpful. It's like saying to your, sad, lonely, single friend, man, you know what you need to do? You're sad. You're lonely. You need to just start dating 10s. Just start dating like just drop dead gorgeous people who are funny and who, you know, laugh at all your jokes and, you know, awesome. Yeah, you should just get married to somebody awesome. You should just do that. It's like, okay. Um, and, and so this, this idea of hiring A players, I, I don't like the advice. In general, because one, it's unhelpful. Two, what exactly do we mean by when we say A players? Because I think, um, it acts as though there's in this world, there are A players, there are B players, and there are C players, and these, and these humans are fixed. They're not. An A player at one business is a D player at another business, and it doesn't speak necessarily to their character. Um, and so I just, I just think it's generally unhelpful. More times than not, the way that A player is, is defined is just very, very fungible. So I just don't like the term. I don't really like the concept. One of the things that we say is, you know, focus on hiring A-players and rock stars, focus on building a company that doesn't require them because those are the kinds of companies that A-players want to work for.

But I thought the other thing that you say though, that I, that I would was that I would like for you to share is, um, is the business might like you, you might just break them. Like if your business isn't ready in the first place, they're not going to help you. They're just going to scale the chaos you've already got, assuming that they don't just leave or say, you know, I can't work here.

Yeah. A true A players, again, throwing up air quote, whatever the hell that means. You get somebody valuable into a company, they're going to be an accelerant. Like that's what they're going to do. And so they're going to come in here and if you have chaos, they're either going to accelerate the chaos by doing the thing that they're really, really great at. So they're specialists at what they do. They're phenomenal at what they do. They want to come in and they want to run their playbook. But if you don't have the infrastructure to kind of prop them up and to hold that, it's just going to collapse under the weight of their awesomeness. And, and by the way, if you wonder if this is true, just look at your own business because more times than not, business owners are their company's first A-player. And it is us when we move too fast and when we bring too much value to the table before the infrastructure can support us, it's us that bring our own companies crumbling down. So either that's going to happen or they're going to get there. They're going to go, this is not a place where I can do my best work. And they're going to leave. And so the idea of, I'm just going to hire an A-player and that's the thing that's going to fix everything. Um, it, it, it's not the way that the, the, the right way to hire an A-player is Let's, before I get to the right way. Okay.

Um, I, I, I want to also kind of talk a little bit about it. It's, it is a luxury to hire an A-player, uh, and it's a luxury that carries liabilities with it that you might not be thinking about. And, um, there are a few specific examples that I've got that I'll share, but basically, um, the, the first thing is, is can you afford them? Um, and, you know, somebody might say, oh, you can't afford not to have them. You know, it's like, okay, but like, can you afford them? Like, do you have the money to pay them? Uh, and very often they're going to ask for some sort of equity if they're higher level A players, and you may not be ready to do that. Um, and the equity that you give them at this point might be the most expensive equity that you ever give, because if you could just get a little bit farther in your business, the valuation would be higher and the cost of that equity to you will be significantly lower. The next thing would be, and, uh, so we had an absolutely A+ player who was coming into one of our portfolio companies or interviewing to come in and, and in the final aspect of it. And when we ask about what are the first things that you're going to like, what do the first 90 days look like, which is a very common thing that we'll ask. Um, she said, um, well, uh, we need a lot more staff. Um, because, you know, where I was before was a, you know, a $3 billion company. I came in when they were only $800 million. And, um, and, um, I had 600 people that were working for me. And, um, you know, right now this company is, you know, with its 200 employees is, you know, horribly understaffed. Like that's the hole in the company. You know, the company she was with, I think had 10,000 or something like that. And, um, and so like, it, it was, she excelled at executing within, you know, very well-funded guardrails of an unlimited budget, uh, and enough people to throw at, you know, and tools to throw at any problem that she came up with. And that, that was what we ultimately came up with. And, and I told the company that was looking at hiring her, I said, you know, look, she's amazing. But I don't think we're ready yet for that. And you gotta understand that everything that she costs is a times 20 because she will fix all the things, but she's going to fix it with lots and lots of people and lots and lots of tools. And honestly, even as profitable as we are, I don't know that that's the best use of our money. And she might just get frustrated because if we put her in a room, in an office and say, All right, we expect you to do the thing you did over there. She's going to be like, okay, where's my resources? Even, even the A-player CFO that you bring into the company is going to hire a bunch of people that you don't think they're going to hire. They're going to hire a controller. That's the accountant. They're going to hire the head accountant. They're going to hire assistants for the controller. They're going to hire an FP&A person for, you know, uh, for planning and analysis there. Going to hire some people under each of those people and maybe an assistant and like, bang, you've got, I don't know, 6 or 7 people in your finance department where before you had a bookkeeper or a fractional CFO, you know, that is a big difference. And the, the, the other thing is that they're very often not entrepreneurs. They are management operators, and it's a different philosophy that will be colliding with the way that you think a lot as an entrepreneur. And they're going to think more along the lines of processes because that's what a good operator's gonna think about than outcomes, which is what you're thinking about. You're gonna be thinking, I just need to get there. And they're gonna be thinking, okay, well, how do we do it? And how do we build a replicable, repeatable process so that we have this handled going forward? Which is the right answer. Unless you need the outcome to survive long enough to be able to do that next thing, which is where a lot of entrepreneurs are when they're thinking about hiring these people. And then the, the, I think the last of the, of the points there would be, um, this, the same, it, it comes from that same place, the operator versus, um, versus entrepreneur from a mentality standpoint. The A-player is not thinking about let's sacrifice everything for the company like you have, not thinking about let's not take a paycheck this month because we need to put that money back into the company. They are thinking my contract says I get this. I am building my resume and I expect to be paid as per the contract that we negotiated and is in writing and that I will absolutely sue you for to enforce if you don't do what you said. And I don't even mean that in a bad way. And I don't even think that they are bad for thinking that way because it's not their fricking company, right? It's yours. You're the entrepreneur. You're the person who is trying to have the culture of whatever it takes. Let's go. If we have to work late nights and blah, blah, blah, blah. And they're thinking, my contract says I work 4 days a week and I get this much time off and you're gonna cover this and you're gonna pay that.

And you better be ready to do it because you will be held to it.

And, uh, again, it's not bad, it's just different. And, um, and the things that they're gonna be thinking will be very often resume development oriented. Like, what are the KPIs that, you know, that I was able to change? How was I able to affect the company? Cuz they're thinking about where they're gonna go next. So a couple of. Scenarios for you. One company, we negotiated 5 months and, um, and still we're almost to the end of a contract. And then some things happened in the company that the operator said, oh, well now that changes everything because I was thinking this and all the things that we agreed to now have to change because This isn't what I thought. That's not wrong either, but it's extremely frustrating to us as entrepreneurs to be like, yeah, okay, so the, you know, EBITDA came in a little bit different than we thought it was, you know, would you, you know, if it had come in higher, would you have been like, I'll take less money? Probably not. You know, so do we change because it came in a little bit lower, you know, but they're not wrong to ask for it because they're, they are, uh, contractors, you know, mercenaries too strong, but it is kind of the, the applicable Answer. They are hired guns. And, um, and so that's something to think about. Another was a software company that brought in a CEO that had all the right credentials, multiple exits, was independently wealthy, and, um, was going to be, you know, the solution to all of the management challenges of the business. Business was highly profitable, multiple 7-figure EBITDA, and, um, they ended up having to buy that person out because the person came from enterprise and this was not enterprise. This was more SMB focused. The enterprise solutions, shock, shock, didn't work in the SMB environment. And the contract that was negotiated because everybody was in love with getting this person in was a terrible contract that then had to be bought out at a significant price that cost the entrepreneur founders significantly right off the bat. So So I say all that, you know, to say they're, they're valuable, but they're not panaceatic. They are full of challenges and liabilities. And particularly the culture clash, I think is the biggest surprise that I see when entrepreneurs deal with them.

Yeah. And this is one of those, somebody that'd be like, oh, but that's not what I mean by an A-player, right? Well, I don't, by an A-player, I don't mean somebody with like all of this pesky experience and all that kind of stuff. And that, that's why I don't like the term because What you just described is in reality, when most businesses are thinking about hiring an A-player, they're saying we need to hire somebody who is a level or two up from where we are right now, who's been where we are and has gone where we want to go. They're going to have vastly more experience than anybody else. We're going to bring them in. They can take it and run with it. They're going to do all the things that you just talked about. But a lot of people are like, no, no, I don't need somebody necessarily who's that. I just need somebody who can step in and do this thing. Or who can own the— and that's the distinction again between A players and owners that, that we're trying to, to drive. And in the earlier days of a small business, which I would define as kind of everything up to and through $50 million in revenue, right? You, you probably don't need what the rest of the world would define as an A player. Uh, and what you probably need to do is to build more of a team of, um, of owners., who are leveraging tools and who can, who can drive particular, you know, outcomes. And obviously it's different if you go and raise capital or something like that.

And so, so when you say owners though, let's clarify for people, 'cause a lot of people are gonna be like, no, no, wait, wait, wait, I don't need no more partners.

Yeah. Lowercase o. Uh, yeah. Lowercase o.

These are people you were talking about in the context, I think, of, of micro CEO. So what, what is that?

Yeah. And how does that— so I mean, a micro owner, a micro CEO, these are people on your team who you can say, I need you to own this specific outcome. And you're very clear on the outcome that, you know, that you need. So I need you to own the outcome of we need to generate 3,000 marketing qualified leads a month. That's the outcome that this business just needs right now. You don't necessarily need a CMO who can go and do that. Now we're not necessarily thinking about title. What you're, what you're doing is we're, we're isolating roles into outcomes. And this is, this is the bridge because at some point, yes, it'd be nice if you just had a team of people who they themselves were working and collaborating and they were figuring out all of the ideal perfect outcomes. But those kind of folks who have the ability to think multiple steps ahead, ahead, because they have the experience, you probably just can't afford them now. And if you did get them, you probably could not metabolize their awesomeness. You're still a baby. You're still a little— and I don't mean this in a pejorative sense, but like, you don't give an infant a T-bone steak. They can't chew it. They can't metabolize it. It's— they're not ready for it yet. And so this idea of like, we can just bring talent in and it's magically going to fix everything. It's not, it's almost certainly not. And so how do we bridge that gap? We bridge that gap through shifting from, 'cause kind of the first phase is there's going to be me and then I'm gonna get a bunch of helpers. I'm gonna bring in helpers to help me do it. And so I, as the owner, I'm the one defining, uh, the outcomes and I'm getting people to help me achieve those outcomes. The shift in between that and the quote unquote A players are the micro owners, the people who we can collaborate with to define the outcome in a functional level, and they can drive to that specific outcome. They may not be able to look out 2, 3 years from now and talk about how the outcomes are gonna change. That's why you're still very much sitting in that visionary CEO role., but they can own an outcome and, and you can assemble the team who can own that outcome and you can incentivize them to achieve that outcome. That's what I mean by micro.

How does that differ from an employee or is it the same thing just with a, with a label?

They're all employees. I mean, that, that's, that's the, A-players are employees.

But like you would, like if we call it a micro owner, um, that feels like that should be different from just basically an employee? Like, I'm not saying— that's how I would, certainly from a legal standpoint, they are an employed person at the company as opposed to a contractor, but role-wise, expectation-wise, authority-wise, autonomy-wise, um, what, what's the difference between the average employee and that person?

Yeah, the average employee is going to manage, um, to a task. So they are going to be responsible for doing a particular task. I'm, I'm gonna, I gotta move this pile of things from here to over there. I gotta take widget 2 and connect it to widget 3. Um, I, I need to, to draft an email and send an email, but they're, they're managing to task. That's kind of the level 1, uh, management.

So would you say that it's the, the employee is basically managing to a task set that applies to the role that they have?

Yes.

Uh, I'm CRO. I'm sorry.

Yeah, the, the role, their role is defined by the tasks that they're responsible for completing. Right.

And vice versa. Right. So, so if they're CRO, we know all the things CRO's supposed to do. There's a job description for it, hopefully. Um, if not, you research one, get AI to generate it, and then you're like, oh, okay, this is what the CRO's supposed to do. And then you're like, hey Ryan, you're the CRO now. Here's the list of things that, you know, try ChatGPT told me you should be doing. Uh, and you're like, okay, I got it. And the subtasks associated with it. But if you are, instead of CRO, you are the micro owner, is it the micro owner of the task or is it actually more of you are the mini CEO micro owner of this division or product line or, or, uh, P&L, you know, line or something like that.

Yeah, it's to a metrics-based outcome and that's the difference, right? And so frontline employees, like a level 1 employee is managing to a binary. Did I complete the task? Yes or no? And I guess it's not totally binary because it's, did I complete the task to the stated?

Yeah.

Like, did I do it? Did I do a good job on it? Um, the next level up is the, is kind of that, that micro owner. Where they're managing to a specific outcome-based metric. So there is a, there is a number that they need to hit, and it is their job to figure out how do they assemble the things to achieve that metric. Now, a level up from that, now what we're thinking about is strategic outcomes. Okay. So not necessarily a metrics-based outcome, but a strategic-based outcome. And that is, as a company, we're moving in this direction. Now that's going to waterfall down, down to what are the metrics that need to be true. And then that's going to waterfall down to what are the tasks that must be completed to achieve those metrics. And it is that middle part that is the one that most of us, I think, ignore, forget about, aren't aware of. Um, and, and it's because what we, what we start off with is I've got all these helpers and I just, but I'm overwhelmed because I got too many helpers. And then what we think is the next level up is a manager. But in reality, if you just get a manager, then the only thing that we did is we just elevated the task. Now their task is to manage the helpers, right? If, if, if these people who are hiring above aren't managing to a specific metrics-based outcome, we are not actually taking anything off of our plates. And so if we think about it like that and say, okay, what are the metrics-based outcomes? That we're looking to do. Now, who's somebody who knows how to achieve that metrics-based outcome? So the way that I interview for this is not like, okay, tell me what you— I'm gonna read it to the interview.

Okay. Because I wanna talk about it. So, yep. I, I, I kind of put like, what, what would that look like? And it's basically, um, you have to transform your internal architecture from a centralized command hierarchy into an internal ecosystem of autonomous profit centers. And this is, I think, important. A micro CEO is a high leverage operator given full end-to-end sovereignty over a distinct business unit, product line, or customer acquisition funnel. They're not measured on tasks completed, but on the capital efficiency and profitability of their specific pod. So I like that, um, as a, as kind of a, a definition of what we're at, because I think it's, it's easy to get it mixed up otherwise. Like they actually, as an owner, need to have ownership. They need to have autonomy. It can be within a band, right? But they've got to be able to make decisions. You are a coach, you know, you're like an advisor to them within your company and they are gonna run with it. And if you don't let them do that, they're not an owner and they won't behave like one and they'll ultimately be just an employee. Is that any thoughts?

Exactly. And so we are making the shift and we're from, from the, hiring people and defining roles based on the tasks that they do to hiring people and defining their role based on the outcomes they must achieve. That is a metrics-based outcome. And every single functional business unit is going to have this, whether it's sales or marketing or client services or product. There's, they're all going to have some metrics-based outcome that, that they need to, to manage to, that they, that they need to promote to. Okay.

Now you're talking about hiring.

And so now, yeah. So now when we're hiring for these people, um, you can go in terms of what the role is called. I don't know half the time. All I'm, all I'm doing is I'm saying, okay, we need somebody who can achieve this metrics-based outcome currently. Marketing qualified leads to this and they need to go to here. And this is, this is kind of some of the things we're using. What is that person called? Is that a marketing coordinator? A marketing, senior marketing manager? It could be anything.

It's because any of those people could be A-players. So I would say any role that could be an A-player could be a micro-owner, micro-CEO.

Yep. And that again, and that's why like we don't even, we're not even using the term A-player. It's just, are they an owner? And then what's the degree of ownership? So I'll go to AI. I'll go to ChatGPT and I'll go to Gemini and I'll go to Claude and I'll say, what is the person called who needs to achieve this outcome? And I'm going to see what they all say. I'll argue to mix. And that's when we'll come up with what the title is and the job description. Then we put that out there. Now, when we're hiring for it, this is important. I'm not asking all these things about, well, tell me about what you did, your background and this company. I'm asking questions about, okay, so hypothetically speaking, and by the way, it ain't that frigging hypothetical. If we're currently generating this many marketing qualified leads, or if our, if our net promoter score, client net promoter score is currently this and we want to get it to here, what are some things that you would do to elevate that? Feel free to ask me questions. And so what I'm trying to figure out is, does this person know the series of activities, the tasks that need to be stacked together, lined up to achieve that outcome? Can they speak confidently about it? Now they may be talking about things, dude, that I got no fricking clue what they're talking about. And that's fine. I'm taking notes. I'm gonna try to confirm some of this stuff later, but that's what I'm hearing. And that's what I'm interviewing for. I'm not necessarily having him tell me about the fact that, oh, well, I took, you know, this brand from $800 million to, you know, $3 billion. It's like, okay, how'd you do it? Like, I want to know specifically for me and for this business and the outcome that we need to achieve, how would you do it? And gimme some examples of when you had done, did it in the past. If they can do that, then okay. And we're not really talking about A-players. It's just your job. If you come in is you're gonna own this. Okay.

So let's talk about comp because, um, that person, if they're going to behave like an owner, they need to have ownership-like upside. At least I believe they do. So I guess that's the first question. Do you believe they do? And if so, how do you achieve that?

Yeah, and this is, this is the great thing is because they're owning to a particular metric, you should be able to put a number based on what is it worth to elevate the metric from the point you're at right now to the point that you want to be. Like you should be able to back into a dollar figure for what that would be., for what that'd be worth to you. And then it's just a matter of, well, what are you willing to pay for it? And what are you willing to share? Are you willing to share 10%, 5%, 1% of the upside? And this now allows you to figure out what is their total compensation. Because if all we're doing is hiring people to own outcomes and those outcomes achieve this result that we want, and they're only going to get paid the full amount if they achieve that result, then these people aren't expensive. These people are what's called a good investment. Now you still got to make sure you got enough money laying around to fund them between the time when you start paying them and when they achieve that result. But now it really is a, is a question of math. But what we're not doing, um, is we're not necessarily giving them equity. Um, and the beautiful thing about this discussion is everything is framed around achieving an outcome. And so it makes sense that compensation would also be tied to the achievement of that outcome. If somebody shows an ability to work cross-functionally, if somebody shows an ability to operate strategically, maybe we can talk about some kind of phantom equity. But as long as they're tied to a task or to a specific measurable outcome, then it's not going to be any type of equity.

So a couple of things. So you have, uh, the, the, the bigger traditional synthetic equity is, uh, profits-only interests and phantom equity. But that is similar to equity because it is, it is a right in the value of the entire enterprise. The things that you could also look to would be a, a pool participation. So basically a bonus based on the profits of the, that increase in the thing that they are managing. So figure out what is the contribution, how do we define that? Contribution of that thing. What is profit there? And then they get a piece of that. That's an income-based thing. That's not really building any equity for them, but it is money that's on top of the money they would get. The other would be some sort of synthetic microequity in the thing that they're managing. So you basically give them effectively units of that and say that that works out to, 5%. So now you've got 5% of this division, this funnel, this product line, whatever. And, um, you agree in advance what's a multiple that that is going to be, you know, translating to in the company. Let's say, you know, and be conservative there. Let's say it's 5x, right? Great. Well, now if you've contributed $100,000 in, like if you took out $100,000 in profit for your interest on that 5%,, and we're using a 5X, then that $100,000 that you got times 5 would mean that you effectively had a synthetic equity in that, not the whole company, just in that one micro part of it, um, for $500,000. And so if they were to leave the company, and that could vest over time, just like other synthetic equity, um, you know, maybe it's time-based, maybe it's milestone-based, maybe it's a combination of the two. If you increase you know, profits in that division by 40% or more over 3 years, we'll vest you, you know, X percent. You know, you can do any, any of those typical vesting, uh, schedules that you like. But then if they were to leave after that, they actually have equity, not in the whole company, but they've got a claim to what they have added equal to the percentage that they would own in there. And that's a really cool way to do it. Because it's tied only to their performance there. They don't get to ride the rest of the company's up or suffer or be punished by the rest of the company's down. They're solely compensated based on the actual contribution that they get at market, but they are building some sort of asset that can be beneficial to them. And, um, the other benefit to them would be they don't have to wait until the company sells to get it unless you build that into the, agreement, you could also have the, you know, must be present to win language. You know, if you leave, you lose it so that they don't build that up and then take all their knowledge and experience to a competitor. Plus you have to pay 'em a chunk of cash. That would suck. Um, you could have a non-compete that would probably be enforceable. Check your local law because they do have an interest in the, you know, in the value of the company. So that might be, good at making an otherwise unenforceable non-compete enforceable. Uh, there's a lot of good things to think about there. You can have puts and calls and all kinds of other things so that you can buy them out if you need. Like there's, so there's, there's a million really good ways to structure that. Um, and I would argue that you really should be thinking about that if they're going to behave like an owner and you want them to do that and take true ownership, they should have the owner upside., but it should be tied only to the impact that they're directly having on the company.

Yeah. I mean, typically there's a, um, when we've done it, there's been kind of a, a progression. Obviously when you're an employee, you're gonna get a salary. And so these people are gonna have a salary when you step into micro-owner thing. So now, and again, I, I note that I'm not talking about, well, is this person a VP or a director? Again, I, I, that's not the concern. It, it's, are they, are they responsible for a task? They're gonna get They're typically going to earn a salary or whatever's typical for that, that role. Now, when we step into micro-owner level, yeah, now they're going to, in addition to a salary, get some type of variable compensation that is going to be a function of their achievement towards that metrics-based outcome. The next level up from that, now we're getting into people who are, uh, participating, you know, a little more, you know, broadly, a little more strategically. This is when they're gonna have some kind of participation in a profit sharing pool and/or equity, you know, phantom or real or otherwise as calculated, you know, in varying ways. But that, those are kind of the, the 3 tiers of comp, cuz they're also kind of the 3 tiers of team members as we see them.

Another advantage that I like to these people is that they are aligned with the owner in flattening the company. Whereas a manager is kind of incentivized to have more labor. And they're not particularly incentivized to shrink the pool. You know, they, they might be if they've got a profit-based bonus, but a lot of them don't because it's hard to calculate. So I think this is basically aligning your, your micro owner, micro CEO with you as an AI-informed entrepreneur thinking that, um, I'm going to be more competitive if I can flatten the organization. And whereas a manager might be looking to have more people to make their job easier or, um, not thinking about the full consequences from a profitability or competitive standpoint, the micro owner, micro CEO will be thinking about that. So I think that's a, an advantage to it.

And that's exactly it. The way that most companies, the way that you rise up in most companies is you expand your scope of control, your sphere of influence, usually in headcount. Right? I mean, that's what you do. The, the way that you go from an individual contributor to a manager is you start managing other individual contributors. The way that you go from a manager to a director is you start managing managers. The way that you go from a VP to a director is you start managing directors, right? Like, this is everything right now in, in most corporate structures is a function of I get promoted and I get paid more based on the number of, of people that are under me. And that's exactly the pattern that we want to break. That's why I don't love the titles. It's why I don't love A-player terms, why I don't love a lot of the existing stuff, because ideally in the future, in an AI-powered world, we don't need just pure managers, right? What we need are player coaches who can do the thing. And yeah, they can run some people, but they can also run some AI employees. We want to completely separate the idea of promotion at this company is a function of the number of people below you. Promotion needs to be a function of how many outcomes can you deliver for the, for the company and how many kind of macro versus micro outcomes can you deliver. I like it. If we can make that shift and we can tie compensation to it, we can have a, not just, I think, a better, more scalable, more profitable structure,, but also one that is going to be more resilient as we shift into an AI-first world.

I like it. Yeah. And so I think that, that the contrarian view could be that the A-players that you've got or you're thinking about hiring could actually be constraining your scale. Um, they could be basically frustrating your ability to scale because they're resistant to non-labor-based expansion. And, um, and, and therefore might not be helping you to be as competitive as you could.

So, and be very careful, small businesses, because the, the people right now that are getting fired, laid off from the big companies are a lot of these mid, mid-level people who those companies realized that they, they don't need them in the age of AI. They can flat, they can flatten that. And so there's going to be a glut in the labor market of exactly the kind of people who you responded, who were going to look from the outside in based on their resume to a, to a small business owner, to an entrepreneurial company, like an A-player based on where they worked and their quote unquote experience. And yet they're the exact opposite of what you need because they don't know how to manage.

3 to 5 years from now, there'll be a, a dearth of leadership because there won't have been middle managers coming up managing. But that's an argument. But what I would argue is that you'll see the rise of the micro and that, that the people who ascend to leadership will be the people who are the most adaptable to change because we're in such a rapid period of change right now. They'll be tech and AI friendly and aware, uh, unlike a lot of middle managers that have just kind of gotten comfortable managing and have gotten beyond that. I think the reason that you see that happening with middle managers is that they're no longer in the doing and they're not yet to the point of leading. And so they're in this comfortable middle place where you don't really have to be innovative and you don't really have to be a great leader. And so this is kind of, I would argue like that we won't have a dearth of leadership. We will have a ringing out of the people that would have never been able to be leaders and that will just weigh companies down. So I, I see it as a positive move and hopefully those middle managers will be liberated into the ability to start their own entrepreneurial ventures. They'll be reinvigorated instead of living quiet lives of desperation, you know, in middle management, looking at the clock. Um, and, uh, and it can be a positive thing. I really do think it can be.

Me too. I think it will be awesome.

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