The secret to scaling your business…

What is up? Welcome to my channel. My name is Leila Hormozi. I'm co-CEO of Acquisition.com, which is a portfolio of companies that does about $85 million per year in revenue. My goal with this company, uh, with this channel, is to get you from wherever you're at to between $3 and $10 million in revenue for free. And so that being said, today what I really, really enjoyed making this video because I'm talking about in this video really how to find and how to know if you have the right operator in your business. And guys, I made this video because on a consistent basis I meet with about 15-20 companies per week that aren't in our portfolio to see if they would be a fit for the portfolio. And most of those people are doing, you know, anywhere between $3 and $20 million in revenue. That's probably the average. And that being said, what I noticed is literally like over 50% of the time, the issue is actually their operator. And so they don't know if they have the right one, they're unsure about it, the operator's not the right person for the business, or they don't have one and they're trying to figure out what kind of person they need to help them really achieve that vision that they're looking for. Because honestly, most of the times, the, you know, visionary with all the ideas and the great at marketing, great with content isn't always the best operator. And so that being said, this is actually something that I've done myself. So I've been the operator in my business many times, uh, 4 times now in every business that we've I'm currently the primary operator of acquisition.com, and I've done it over and over again at every different revenue level up to, you know, over $100 million. And so that being said, I feel like I'm qualified to talk about it, and I've helped so many people find an operator, replace operators, and get their first ones. And I hope this video will do that for you. All right, so like I said in the description or the intro, today we're going to talk about how to hire your operator. And the reason I'm not saying first operator is because I actually wanted to make this kind of a tiered approach. So basically, you know, what kind of operator you need from 0 to 1, from 1 to 10, from 10 to 50, and from 50+ on. And the reason I feel like I'm qualified to talk about this is because I've not only been the operator at every point in time, but I've also replaced myself with operators at each of those points in time. And so I have a lot of experience, uh, hiring those people. I have a lot of experience doing it. I've got a lot of experience knowing what failure looks like. And this video was actually prompted because I have a friend and he messaged me the other day and he said, you know, Leila, I'm kind of like on the verge of tears. And I was like, what's going on, dude? He's like, you know, his business is doing about $200,000 a month And it's literally just him with like contractors. And that's fairly typical. We see this often. And that's usually one of the biggest pain points around that $200,000 per month. That's when people really start to feel the pain. And I was telling him he has to get an operator in place. And he was like, well, how do I do that? And that actually, I said, I'll make you, uh, you know, I'll write up an email and send it to you. And then I was like, screw it, I'm gonna make a piece of content on this because this is something that everybody struggles with. And it's also the reason that so many people's businesses don't work. I see this all the time in acquisition.com. We talk to 15, 20 businesses a week and half of them, the reason their business isn't growing isn't because of the strategy or the it's because they have a really poor executor. And so that being said, I find it to be a really important topic that I think is probably underdiscussed in the community. And what is out there about operations is really archaic and really corporate, and I don't like any of it. And so I'm making this video for anyone who actually wants to know, like, boots on the ground, entrepreneurial businesses, self-funded, what does it look like? So that being said, let's dive in. Before we can really talk about operators, we have to say, what is an operator, right? So it's really the glue of the organization. Like, I like to say, when, when I was starting off and I was the operator, I see myself as the rock. Right? Like I'm the rock for everyone in the organization. My job is to be really neutral and really a steady force for everybody in the organization. I add in predictability and accountability for everyone across the team. And you see yourself as really the lead executor of the business, right? And so it's typically that you're carrying out the business plan that's been decided upon by the visionary and the operator. Again, if you're the visionary, this person is the one that's taking your plan or taking your vision and they're making it come to life. And so you need somebody who's a high, high executor, but who also has a level of leadership skills. And that's why it's a very unique role in the business is that It's easy to find one or the other, someone who loves doing a ton of shit and loves chaos, or somebody who like loves leading people. But it's hard to find someone who has a good combination of both. And that being said, what are some titles and what does this look like? Honestly, depending on the size of your business, this could range. It could be a project manager, it could be an ops manager, it could be director of operations, it could be VP of operations, general manager, president, chief operating officer. Honestly, it's just anything that's a very generalized role that everybody else rolls into in the company. And that's kind of the gist of it. So why is this important, right? Well, at some point in your business, what you're gonna notice is that you are wearing all of the hats. This can happen, you know, when you're first starting off, and this can also happen later if you decide not to hire an operator and you're feeling it later down the line. And what you start to realize is that you are responsible for a lot of things. You're responsible for strategy, you're responsible for executing the strategy, you're responsible for leading people, you're responsible for managing them and holding them accountable. And you start to realize that it's really hard to do all these things at once. I know for myself, this always becomes a point in the business.. And so I've always been the operator before I've replaced myself as the operator. Eventually what it is is that I try for the first year, year and a half of the business to be the primary operator before I hand it off to someone. So I know that I'm a fantastic builder and I can build systems and put them in place. Not every operator can do that. And so I do that. I make sure that I know how to do the job before I hand it off to somebody. And I know that around about after a year of starting a business or a year and a half into starting a business, that's when it becomes too much. I can't be strategic and execute at the same time. And if you look at the stats, only about 5% of CEOs don't have a primary operator. Now again, it can come off as many different titles. People say, well, this guy doesn't have a COO, so, you know, and I'm like, right, but his general manager is basically his operator. And so sometimes it's hidden like that. And basically what happens if you don't do this is you become the bottleneck. And this happens to a lot of people. And, you know, if you're watching this video, you've probably felt it at some point, or maybe you're feeling it right now and you're like, shit, I do need to hire somebody. And you feel like everything's waiting on you in the business. That's probably because you need a role similar to this. And the thing is, is if you get this role right, it's going to do a lot for your business. And I want to paint the picture of what, what an operator should actually be able to do for your business versus what you might think it can do, right? First is they should be removing obstacles. So you feel like there's a lot of constraints that you don't have time to solve, or maybe mental bandwidth to solve, or maybe you don't know how to solve them. That person should be removing those obstacles from your path so that you can keep driving forward. The second thing that person should do is they should be freeing up your time as a CEO or visionary. All the stuff that's on your plate, they should be taking off, I want to say like 70% of it, because they basically want to take away anything that's not absolute highest best use of your time from you, and they should protect you from everything else in the business. So I can tell you, like, you know, when we first started Gym Launch and I was the primary operator of Gym Launch, I wouldn't tell Alex about, you know, if anyone got mad, if there were upset clients, if there was an issue with employees, if anyone was, you know, upset, if really anything in the company was going wrong, because I was like, it's my responsibility to handle it. He doesn't— like, I will 100% bring him in if needed and if it escalates to that level, but 99.9% of things don't need to go to him. It's just going to cloud his brain space and get him away from doing what he does best, which was literally visualizing where the business is going to go, making content, being the figurehead. And then the last one is that it's going to speed up the pace of the business. And this is a huge misconception. Everyone thinks, okay, if I get an operator though, they're going to slow this down, they're going to slow everything down. That is so fucking bass-ass backwards. Like, if you get the right operator, they will speed up your business. And the problem is, is that there's so many— a lot of times what happens, guys, is that an inexperienced CEO hires an operator, they don't know what to look for, they don't know what it looks like, and they've never done it themselves.. And so they just assume that this person's correct. And oftentimes they hire somebody who has experience from a bigger company and they usually come in and there's like all this bureaucracy and red tape and they just slow you down with like all their systems and SOPs and it's a bunch of bullshit and you don't need all that shit to make your business work. I think it's this huge misconception. People always ask me, they're like, Leila, you know, what SOPs do you use for business? And I'm like, I'm gonna jump off a cliff. That sounds terrible. Like I don't run my business with a boatload of SOPs. You know, I run my business by values and I think that a lot of COOs and operators think that you have to run the business by, you know, checklists and SOPs, et cetera.. But that's not the best operators know how to run a business by values, by inspiration. Yes, you want some SOPs and yes, you want some checklists here and there, but that's not what should run the business. So that being said, that's what it looks like if you get this role right. Now, if you don't get this role right, which I've made this mistake multiple times, I've seen this mistake happen multiple times, and I can tell you it is by far the worst mistake that you can make for your business. Because if this person is over literally the entire business, then if they are not the right person, your business is fucked. If your operator's not a 10 outta 10, your business isn't gonna be a 10 outta 10.. It's that simple. If you hire the wrong person, typically what you'll see is that one, business operations are going to slow or come to a halt. So you're going to notice, and there's often like a really interesting correlation which I've seen with a couple companies in acquisition.com, which is they bring in a new operator, or we look back and, you know, they're trying to figure out if that operator is the right person. I say, let's go look at the month you hired them. And a lot of the times, the month that they hired them is the month that their business went stagnant. That's not a coincidence. The second thing that you're going to notice is that revenue and key indicators are going to start to decline. So, you know, basically you bring that person in, it looks like it's going decently well, at least things are stagnant, but, you know, maybe they're going to grow soon. But then you'll see maybe 3, 6 months down the line, things start to decline. And again, that's because what is happening in your business today is the result of the things that you've done 3 to 6 months prior. So if you brought that person in and eventually revenue declines, that is because that person is not driving revenue. They're not holding people accountable. They're not inspiring the team. They're not a good leader. They're not managing people, or they've hired the wrong people. And that usually causes morale on the team to go down, which you'll see is fairly typical. You don't want somebody— this is the thing, everyone thinks I have to bring someone in and they just have to be like, they probably won't be as good as me. And in some roles that is 100% true because you are the founder and you care the most. In this role, you don't have room for that shit. They need to be better than you at the things that they are going to be doing. And I think that a lot of people have really low expectations of what this person should be doing. Instead, they kind of think of them like a high-level admin or like, you know, they're just thinking like they shouldn't be doing strategic thinking or anything like that. It's like, that's complete ass backwards. That's not true at all. Look at like Sheryl Sandberg. And then eventually your best people leave. And again, I've seen this happen time and time again, and it really, it sucks. It's just like if you get the wrong leader in there that's below or next to the visionary, the rest of the team, if they don't like them, they're going to peace out because they're like, I like working for Sally, but I hate working for Jennifer. And even worse, then those people leave and then that operator hires the wrong people. They hire people that are not fit for the business. I've had this happen multiple times where I've had to, you know, shore up the way because the person that I've had in place They've hired the wrong people. And there are people that are an embodiment of maybe their values or what they think makes sense, but not of what my values are, our company, or what we think makes sense. And ultimately what that happens is that keeps you from achieving your vision. Because if this person is the lead executor and they're not capable, then you're not able ever to achieve the vision that you want. And you really end up hating your business due to this one person, which honestly is fairly typical. I see a lot of people who are like, God, I just hate my business. Like, you don't hate your business. You just hate the people that you hired because you don't know what you're supposed to be hiring. It's like you don't know what good looks like.. And that's the truth. It's like most people don't know what good looks like. I see so many people out there and I can tell you, like, I have multiple people who I have known that they operate businesses and I know that they're not that great. And then they go out and they do consulting for businesses and then they say, I can turn your business into a $10 million, $20 million business. And I'm like, bitch, you didn't do that when you were at that company. But it's like, you know, visionaries don't know what to look for. And so that's why I feel passionate about this and making this video is because like you have to protect yourself with knowledge. You have to know what it should look like to have a good operator. And I feel like everything out there is actually contrary to what really works boots in the ground in the business. And so if you really think of your business like a garden, if you're the visionary, what's basically happening is that you are out there and you're painting the vision. You're like, this is what I want the garden to look like. Here's the seeds I have over here. Here's the, you know, shovels I bought, blah, blah, blah. And then your operator is the gardener, and they're like, they have to go out and make the garden happen, right? You've painted this picture of this beautiful thing you want. They have to go make it happen. And so if you get it right, it can look like a beautiful, immaculate thing, and you can be like, this is fucking amazing. This person is gold. I love this person. You know, you hear them, they're like, they just eat shit all day. They'd get so much shit done. They're such an executor. And you just see how much excitement is in people who get the right operator versus the people who don't. Your garden ends up looking like this, and you basically are like, yeah, you know, I, you know, Sally's good, you know, I think she just, uh, I think she just needs some coaching. It's maybe some coaching, or like, you know, I think, you know, I think she was good up until, up until we hit $3 million. But, uh, you know, she does a lot. I mean, she's really busy though, she's really busy. And that's one thing I'll notice is that you just hear the difference in tone between people who have a fantastic operator and people who they know that the operator shouldn't be there and they still got them there for some reason. And then we come in and I'm like, I've got a big red circle around Sally, and I'm like, Sally ain't cutting it. And they're like, yeah, I figured. But you know, it's scary to fire somebody that you feel like holds a lot of power in your business or has a lot of responsibility. What I've come to find is that typically when you remove that person, you find out they weren't doing anything. So that being said, it's really important that you get this right, because that person who creates that dead garden— this is essentially what they're doing. They're cutting— you're up there in first place, like winning, and you're like, I love this, this is great. They're there unknowingly, whether it's unknownly or not, cutting down, kind of cut your tree down. And it happens a lot. And especially if you don't get the match right and that person doesn't absolutely believe in your vision, if they don't, if they're not a complete follower, they're not a complete advocate of you as a visionary, they will 100% undermine you. And I've seen this happen so many times. One of our portfolio companies, I'm gonna say the, the guy's name is Chris. He's the visionary, right? Chris is a fantastic visionary. He's got tons of talent, tons of charisma, great with people, really good at marketing, really good at, you know, building up the crowd. And Chris, uh, I met his operator and I was like, not impressed. And as we kept working together, his operator kept avoiding me. And so eventually I was like, hey, you know, can we talk? And then we get on the phone call, and I would think it would be funny if he's watching this YouTube video, and he basically for 2 hours in one way or another tells me how Chris is not a great CEO, he's actually the one running the whole business, he's who the team's loyal to, he's the reason they're successful. Well, Funny thing, because I immediately, like, I'm like hot inside. I'm like sweating. I'm like, shit, this is so bad. Like, we need to immediately take this person out. And I call Chris and I was like, dude, I was like, did you know? He's like, well, you know, he says some things and it's bothered me. I was like, you can't have any tolerance for people saying shit. Like, your operator has to be your number one advocate. They can't disrespect you. They can't undermine you. Imagine what that does to the rest of the organization. That's a joke. Makes your business a joke. And so the moment we removed this guy, I kid you not,. They like tripled over the next few months. I'm not kidding. So we started working with them. They were doing about $300-something a month and now they're at, you know, $1.3 million a month. And I honestly think like there was no way that we would've gotten there with that toxic operator in place. Toxic, whatever. I hate that term, but you get what I'm saying. Like he was really poisonous to the team. And that being said, that's why this is so important to get right. So you're like, okay, cool, Layla, I get it. How do I actually find this person? Right? Okay. Well, the type of operator you need relies on two things. Okay, it's going to rely on you and it's going to rely on the business. And so I'm going to start with relying on you. Okay, it's really simple, but you have to understand this. Every COO book, every operator book, every manual out there on how to be an operator, the number one thing is that you need to be whatever the CEO or the visionary needs you to be. And so it's really, it's kind of like an executive assistant role, which is a form of an operator where it's really dependent on that other piece, that other person, the visionary, what are they good at, what are their capabilities, etc. And you just have to mold into that role.. And so if you're looking and you're trying to figure out what kind of operator do I need to hire, it's really good to be cognizant of your own strengths, weaknesses, likes, and dislikes. And so I'll give you like a base case that I see typically, right? Someone comes into acquisition.com, it's like a visionary. Their strengths are gonna be marketing, sales, math, inspiration. Their weaknesses are gonna be management, follow-through, delivery, and focus. They're gonna like content marketing and speaking, and they're gonna dislike meetings, project management, and generally people's stuff. And so this is a really base case, probably because a lot of people who come to acquisition.com, they're really obviously it's acquisition.com. And so they're really attracted to a lot of the content that Alex makes. And so by nature, they're actually pretty good at all the same things that Alex is good at. And so when they come in, the things that they're bad at but they're doing are like management, accountability, systems. And so everything's just kind of like this hodgepodge. And so the best way to think about this is you basically want to hire somebody who their— your weaknesses and your dislikes are their likes and their strengths. So they are strong at management, at follow-through, at delivery, at focus. They like meetings, project management, people stuff. And that's the biggest thing you want to think about. Like, what are the things that you hate doing that you suck at? And that person should be the app— they should be the— they should essentially make you a whole. Because, you know, for that 5% of CEOs that are able to be the visionary and the executor, they have found a way to not have weaknesses detrimental enough to harm the business when they act of those two roles. But it is very, very rare, and it's very, very hard. I've seen it maybe 2 times where someone's done it very well. And so that being said, you want to hire the person that is going to be able to fill those spots for you. And so that's first and foremost, like, the first filter you want when you're looking for an operator is like, what do I hate? What do I suck at? That person needs to be good at and like those things. Now the second piece is the business. And so here's what we're going to break down. I really want to give you guys a good clear vision for like, depending on your revenue level, what kind of operator do you need? And again, like I said, I've done it at every revenue level. So that being said, the business piece, um, if you look at the business and you think about the entrepreneurial journey, right? Okay, so you have to basically look at the levels that are needed in each level of the business. And so This is how we break it down at acquisition.com and what we believe makes the most sense and is necessary at each point in time. Okay, let me move my little guy. $0 to $1 million, the entire focus is market fit. Okay, so you've got one product, one avatar, one channel. Problem is you have no idea what the fuck you're doing, and the objective is you want to consistently sell something that people actually want to buy. Now the second level is deliverable, and that's $1 to $10 million, and there we're trying to increase the lifetime gross profit per customer. The problem here is that typically when we run into entrepreneurs in the space, they're not making enough profit per customer scale, and they're not sure how to structure it in a way that would be advantageous to them and to the customer. Now, the third level is $10 to $50 million. And at $10 to $50 million, we're really focusing on consistency of deliverable, right? And professionalizing the business, because the problem is that we have inconsistent delivery, we have poor tracking, we have CRM issues, finances are a complete mess. And so that's when we really have to professionalize the business. It's a lot of incremental improvements. We're not figuring out a lot of new things at this point. We're just putting in systems and practices for the business.. And then that last level is really that $50 to $100 million. And at $50 to $100 million, that's when you have to think about attracting talent. Okay. And the reason for that is the business has to grow through different revenue streams typically around this point. And so either you become a conglomeration of products and product suites, or you become a conglomeration of businesses, right? So a lot of people go into M&A after they hit about $50 million. The problem up here is that innovation tends to die. And so the product's not old and fresh, it's not fresh anymore. And so you typically need to bring in people with ideas. So that being said, how does this translate to the operator? Okay, well, what you have to understand is there are actually two types of operators, okay? And they exist on a dichotomy. And so there's not anyone that's— it's not black or white. There's not a builder or an incremental improver, but there are how much of a builder are you, how much of an incremental improver are you. And so it's a dichotomy that each operator has to manage, but you want to be cognizant of what that person's natural strengths are. So a builder operator is someone who really thrives in chaos. They like to build things from scratch. They don't need any direction at all, for the most part. Uh, they love to be insanely busy. They're operationally creative, so they can essentially come up with ideas from scratch. And they're really good in wartime when it's like, this is go time, the game's on the line, let's go. That is what I would consider a builder. On the other side, there's incremental improvers. They like to scale and improve what already is working. So they're not thinking about building from the ground up, but they can take it once you've gotten it from 0 to 1, and they can take it from 1 to right? That's hypothetically speaking, not in terms of numbers of the business. They like improving existing systems and they value consistency and predictability, and they can add a ton of that into the business. And they're very good in times of peace because in times of peace, the last thing you want is for someone to redo everything and, you know, be throwing chaos into the mix. So like for myself personally, I tend to err towards the side of builder. So that's why it's easy for me to like be the primary operator in the beginning and then hand it off to somebody who's a little bit more of an incremental improver once we hit a certain revenue And that's just kind of how I've always done it for myself. So that being said, what I want to talk about is what does each— what kind of operator do you need each level? And they do sway towards one or the other based on the level you're at in your business. So $0 to $1 million, you're just finding market fit, right? And so this is really marketing and sales focused. You know, we're not focusing on delivery yet. We're not focusing on, you know, customer experience yet. We're really just like, can I sell this shit over and over again? That is the main objective of the business. And so at this point, Revenue level, you're at 0 to 1. The business stage is market fit. The objective is to get one product that you sell to one avatar through one channel. Product market fit. The problem is you have no idea what the fuck you're doing. Uh, the kind of operator you need in terms of title at this point in time, you probably need either an executive assistant, a project manager, an operations coordinator. So it's a little bit of a lower-level operational role. And so at that point, you don't need a COO or something of that sort. You just need something that's someone that can help you do pretty much everything. And so the type of operator you need here is really a builder. You do not want incremental improvement at this point. You don't want someone who's super consistent, super slow. You want someone who's like fast, chaos, love doing shit, love getting shit done. And so their responsibility really at this point is like wearing all the hats, doing all the day-to-day on behalf of the visionary and taking the vision and really starting to build all what you need from scratch. And so that being said, with this point in the business, this is what I typically see goes wrong, right? The most common points of failure are these 3 things, which is one, as a visionary, you hire someone who's way too inexperienced. So a lot of times it's they're too inexperienced in your type of business. They've never been in a startup before and they've never even done this role before. And so if you already, you've never done this and you've never done this business, you bring someone new in, you need them to have some kind of context because like you don't, so they need to. And so you want somebody who's like been in a startup, started things with somebody before, they can thrive in the chaos. Now the second piece point of that is a lot of people hire someone who seems that way, but they have a low threshold for stress. This, it's very unstable at this point, and you need somebody who's excited about the instability, not going to complain about it. And so my— some people are like, oh no, you want the personality that's contrast. No, bullshit. They're going to eventually resent the business, resent you, be upset for how much time it takes, you know, no personal life, no balance. They're going to complain, and you don't want that. And I've seen this happen time and time again, even in Gym Launch. Like, when we would start new product lines or new sectors, we would sometimes take people from other departments, deploy them on this new project, special project, and You know, they're essentially being like the primary operators and builders. And some people did terrible. And I remember one girl, you know, she said to me, she was like, Layla, like, I will never do that again. And I remember thinking in my mind, I was like, why? And she was like, I mean, I just worked all the time. I had no work-life balance. And I was like, yeah, but how much shit did you learn? Like, that's amazing. You know what I mean? But not everybody feels that way. She was just really upset she didn't have work-life balance. And so like, that's really hard to have at this point in time with a business of this size. And so you can't really hire for somebody like that. And the last part is you don't want somebody with a lack of sales aptitude. And here's why I'll tell you is what I have seen time and time again is that if the primary piece is to figure out the thing that you sell and who you sell it to, you want somebody that is on your team that they also know how to sell. Like they also could, if needed, like coordinate the calls, do set calls, things like that. Because like it's really scrappy at this point. You need people to be able to wear multiple hats. You want someone with sales aptitude. And so that is where a lot of the points of failure are. So if you're at $0 to $1 million, you know, you really want someone who is experienced, they have a high stress threshold, and they've got a little bit of sales aptitude. Now let's say that you are at $1 to $10 million. And I'll tell you that this is probably the most popular revenue level where people do hire an operator. So if you're watching this and you're between $1 to $10 million, you might have an operator. It's also typically the revenue level where you fuck up what kind of operator you hire. So that being said, the objective here is really to increase the lifetime gross profit of that customer. And so usually the issue is that you're not making enough per customer to scale. So it's like, I want to scale on a higher team, but I'm not making enough money. It's like, right, because you need to figure out lifetime value of the customer and how to make them more valuable to you.. And so typically at this point, what you need is you need somebody as an operations manager or a director of operations, right? If you're at, you know, just $2 million a year, $3 million a year, might be just an operations manager. If you're more towards the $10 million mark, it might be more of a director of operations. Now titles don't matter as much because pay can vary between the titles. And with the type of business you have, it might be better to attract one or the other. It's really dependent on that. But what you do need still is, I think a lot of people mess up here, is they think I need someone who's really an incremental improver, you know, someone who can put the consistency and systems in the business. And then no, fuck that. You're not even at $10 million yet. You need builder. And this is what a lot of people get wrong at this level is they think that they need that person with all those systems and SOPs and shit. It's like a little bit, but you need someone who can still build. You haven't built it all yet. This project is not finished. And so it's their responsibility to really organize the chaos within the functions of the business. So they are at this point, you're gonna be hiring leaders, managers of different functions, nothing super high level, but management level. You'll be setting the cadence for the team, adding in some consistency and implementing systems. And so So this level, again, like I said, is probably where most people get it wrong. It's also where the most people hire. And here's what I normally see is that the most common points of failure between $1 to $10 million, okay, the first one is that they go and you're a visionary and you're like, I need to get someone from like a big company, big corporate, you know, someone who really understands these systems and operations. And you're like, I just really need to get someone here with that kind of experience. So you hire someone from like the corporate world too soon. Like, you do not need corporate at this level. In fact, it would probably do the opposite of what you would want. And so I I would recommend against that, and I would try to hire somebody that's worked in, you know, fast-growing startup businesses before. The second is that you often find at this point that there's a lot of people, uh, bring on operators who lack humility. And it sucks because this is usually where the business has the fastest growth, is from that like $1 to $10 to then $30 million. And if that person lacks humility, they're going to bottleneck the shit out of the business. And I've seen this happen time and time and time again. And I can also see it a lot with like people at acquisition.com is Like if someone has an operator and I'm talking to them and I'm saying like, here's what we wanna be preparing for next, here's this. And, and they're like, yeah, no, I, I got it. Like I've, and then they always try to reference like, well, you know, my last company, I kind of, you know, this or that. And I'm like, you haven't done it in this fucking company, have you? Right? Like you've never been an entrepreneurial one. You've never been in one like this. And so it's really interesting because what you'll notice is that a lot of the times the visionary remains super coachable and then they have an operator who's like a little more stubborn or pigheaded. You don't want that. That will not succeed. The best operators are the ones who are absolute learning machines. I can tell you one of our portfolio companies, we brought in his wife to be the operator. The reason I knew that she would be a fantastic operator is because I looked at her P&L and I was like, hey, like, we're not booking things correctly. Like, this is how you actually want the P&L set up. Here's an example. And she went to the accounting firm that they worked with and they were like, hey, we can't do that for like 3 or 4 months. It's gonna take us that much time. So this bitch went and she learned accounting and then 2 weeks later sent me her books from the last year that she redid all books. That is the kind of person you want as an operator. Someone with like the utmost humility, absolutely able to be coached, and an insane executor. Like, can you imagine that level of execution? Is insane. And then the last piece is if you hire somebody as an operator and they are unable to delegate, that is not what you want at this level. This level is the point where very soon that person can't be doing 10 or 20% of everyone's job. Usually around that 1 to 10, they are. That operator's helping a lot of this team because they're probably not trained up. Their lack of context is a new team. There's a lot of inefficiency efficiencies, right? So they're making up for the inefficiencies in their operations. But it gets to a point where you have to be able to delegate, and a lot of the times they're not able to at that level. And it probably stems from the lack of humility. So next level, $10 to $50 million, right? Here is where we want consistency of delivery. So we figured out how to make more profit per customer, we're making more money, we're getting a little more team in there, we've got things going, it's a good machine, right? And now it's like, I feel like everything's breaking, there's no consistency, I have no transparency because I have no good financials, I have no good numbers, I don't have good tracking, that is where we're at when we're usually at that 10 to 50 mark, right? And so what kind of an operator do you need here? The problem is typically that everything's inconsistent and we've outgrown most of our systems, right? Usually you want to hire someone with one of the 3 titles. It's director of operations, VP of operations, or a COO. And now this point in the business, once you've gotten everything figured out and you're like, this thing works, we've got it working, we've got people in place, that is the point where you're like, I need someone who's more of an incremental And the reason is because, is because you need some predictability, you need some consistency, you need some, you know, just improvement to the business. The thing already works, we just need to make it better. And so really the responsibilities at that point are like, we're going to migrate ourselves to professional platforms, we're going to formalize our finance, you know, make sure we have GAAP accounting, we're going to be tracking the right metrics, we're going to hire leaders, we're going to continue to remove the visionary more and more from the business and get them to only doing the strategic visionary stuff. And that's really the job at this point in time. Now, where do most people, operators, mess up at that $10 to $50 million mark? Okay, here's the 3 things that are done wrong typically at this stage. And so again, I'm making this so if you're the visionary, you know what to instruct them on. One is they add too much red tape. It's an art and a science to adding just enough systems to a business for it to work better without slowing things down. And a lot of operators don't know how to do it. I can't tell you how many operators I've worked with, all they want to fucking do is put in systems and SOPs and more software and more systems. And they always think more is better. The best operators simplify through elimination. They will take things away, they will eliminate systems, and they will get it to one thing that works insanely well for the business. And so you don't want someone that's adding all that red tape. You also don't want someone who becomes the bottleneck by adding red tape, saying you can only ask your supervisor for this, you can only talk to me for this, don't ask any— don't go to him for that, only— oh, you can only speak to me, only me.. And you'll see a lot of times those incremental improvers tend to be like that at that point in time. It's like there's so much bureaucracy around, like you have to only speak to your supervisor, like don't go cross department, you talk to the wrong person here. There's, there's communication cadences and it's like, that's not how life works. That's not how a collaborative team works. If you trust your team, everybody should be able to talk to everybody. There's no like, this is right and this is wrong. It's like, yeah, you report to this person technically, but like you can ask other people for help too. And so that is probably the first place it goes wrong. The second is that, you know, kind of going hand in hand with this is that they are a manager and not a leader. Operator. And so having a high-level manager as an operator can get you to $10 million for sure, probably even $15 or $20 million. But then very quickly it changes and you realize that the bottleneck is that that person is not a leader that anybody else respects. So if that person is not aspirational, if that person is not charismatic, if that person doesn't inspire your team, guess who has to go do that job? You. So instead of working on the business and building the runway for what is next, instead of strategically thinking What do I need to do next to grow the business? You're thinking like, oh shit, like the team needs me. They miss me. They, you know, they complain that I'm not there. If that's happening, that means that you've got a manager there and not a leader. And that's probably the hardest transition for most operators is to learn that really that level 5 leadership skill, which is leading leaders. And a lot of people just aren't cut out to do it. And then the last piece is that they often will value systems over revenue. The best operators focus on revenue. Like it's this It's this weird thing where people ask me, they'll be like, well, what should I tie them into? You know, like, what should I tie my operator into? You know, because obviously not, you know, they're not driving revenue. I'm like, what the fuck are you talking about? They should be the main person driving revenue. They're making the vision come to life. They're responsible for hiring the people over marketing and sales and product and all those other revenue-driving departments. So they are absolutely responsible for driving revenue. And what you'll see in inexperienced operators or operators who've come from really big companies is they value systems and processes over revenue, and you never want that. They should always say, you know, marketing, sales, product always come first. And so that are the point— those are the points of failure, $10 to $50 million. Now look at the last rung of this, just for anyone who— you know, probably not many people on my YouTube channel fall in this rung, but if you do, or if you're curious what it looks like when you get there at $50 million, this is when you really need to be attracting talent because you want to be growing the business through additional revenue streams or through a conglomeration of businesses. And so what does that look like at that mark? Okay, so at $50 million plus The business stage is that of talent acquisition. We really need to be bringing more talent on because in order to grow our revenue streams or grow our business of businesses, we need people. There's no more systems that are going to take us further here. It's not a piece of software. You're not going to have monday.com taking you to $100 million, but you need people that are talented, people who are entrepreneurial. And so the problem here is usually the— and I see this happen time and time again. I had a friend who just had it happen to her. She's like, dude, like nobody has ideas in my business. It's all me. And like our revenue's stagnant. I know it's going to start going down. And that's what always happens is you hit that mark and the revenue stagnates, and then you're like, shit, I know what that means, which is it's going to decline soon. And that's because we don't have anybody else in the company who can come up with ideas. And so the kind of operator you need at this point is a VP of operations or COO. Typically, you're not going to probably get the right person for below that title. Now, what type of operator? Here's what's really interesting is that those incremental, those who are like really heavy incremental improvers tend to suck ass when it comes back to innovating again. And the reason for that is because they need to be a builder. You have to say how— you have to re-envision how the whole machine works again. You have to reinvent the business. The culture is going to change. The systems are going to change. Everything is going to change again. And so you need someone who's a very talented, very experienced builder. And that's why I said being humble and being coachable is the most important thing as an operator. And when you're looking for an operator, because if you find someone who just is coachable and humble, they can be coached and trained to lead the business through this mark. They can watch this video and now they know for themselves. Helps, right? But if they're closed-minded to that, they're not going to make it here. And so the responsibility of that person is reinventing the business so it can support innovation. That's the primary thing that they need to do at this point. They need to break the processes that are long-held. They need to basically reimagine everything, remove all the bottlenecks, and turn away all the waste. They need to start eliminating like crazy. And so what are the most common points of failure, right, at that 10 to 100? The first one is that lack of change management. Right? So at that $50 million mark, you really realize that change management is a skill, 100%. And so if that person doesn't understand how to do that, this is what's going to be the— it's honestly what's probably going to be detrimental to the business because you're going to be putting all these new things in place. You're going to be changing people's roles, adding new people, subtracting people, adding new departments, subtracting new other product lines. If you don't know how to manage change effectively, it's going to be very hard on the team. So you need a leader that knows how to do that. The second piece is again, remember, this is talent acquisition phase. If that person is not inspirational enough, is not enough of a leader to attract the right talent, you're fucked. Because the operator is the person that is going out, is trying to find the talent, etc. Like, you're saying what is needed in the vision for the business, but they should be the one attracting the talent and figuring out who needs to be in each seat. If they can't attract the talent because they are not talent, again, point of failure. And the last thing is, I think this all stems from one thing, which is if this person is growing up and you've hit $50 million, they are often too comfortable because in that, you know, say $10, $20 to $50 million range when you're growing, it's all that incremental improvement. It's all improving and improving in volume and more and more, but it's not different. So it becomes very uncomfortable for a lot of people at this level. And you'll see that a lot of people swap out their operator right here because again, you need someone different who's fresh and new and who can reimagine the business and who isn't afraid of being wrong, who isn't afraid of changing the things that once worked that no longer do. And so that being said, those are the levels, right? So we've got the 0 to 1, 1 to 10, 10 to 50, and 50+. And here's the thing, guys, is I know this is a lot of information. If I were you, what I would do is go back and I would screenshot whatever level I'm at, and I would go over this. If you have an operator, have them watch this. This honestly stemmed from a conversation I had with, one, a visionary, and then two, a dinner I had the other night with somebody's operator who said, what would happen, like, where do you think that I could fail? And I explained all these different breaking points to her. And the thing is that if you get this right, this is what it should feel like. You plus that person does not equal 2, equals 11. Them. That's the best way that I could, like, in one just short summary, that is what it feels like when you have the right person, is that once you get that person, everything skyrockets. So that being said, I hope this video was of use to you. If you want more videos like this or more videos on hiring that, like, integrator-operator role, drop a comment below. I'm curious what you guys think. It's a little different than things I normally talk about. I could probably talk about it for hours because I've done it so much, I've hired for it so much, and it's what I do primarily in acquisition.com. That being said, have a fantastic week.