Behind the Scenes of Success

behind the scenes

I’m one week away from my second Lake Placid Ironman. One more year of training under my belt. One more year of discipline, sacrifice, emotional and mental fitness, all in the pursuit of celebrating my fitness with one long ass day of swimming, biking, and running. It’s not really about the race. Yes, it is an incredible day. The energy is amazing. It’s a true test of your mental and physical endurance. But at the end of the day, it’s not about the sixteen hours and 50 minutes of competition (this year I’ll be sub 10 hours), it’s about the 365 days of purposeful practice and preparation.

You see, success happens behind the scenes. When I cross the finish line in Lake Placid, it’s because of my 3am wake-up calls, my carb cycling, my heart rate monitoring, my foam rolling, my swim lessons, and more. When my company lands on the Inc. 5000 for the second year in a row, it’s because of my team attending late-night town planning meetings, connecting with investors, putting together pitch decks, pricing projects, choosing interior finishes, and more. These awards, accolades, summits, and finish lines are achieved only by months and sometimes years of hard work, focus, grit and determination. We know overnight successes are a fallacy. It’s truly what happens behind the scenes that matters.

What’s going on behind the scenes of your life, your relationships, your fitness, or your business? If you want to achieve success, in any sense of the word, you’ve better be putting in the work. And not just when people are watching. It’s what you are doing when there isn’t an audience, when your boss isn’t looking over your shoulder, or when their isn’t a cell phone camera waiting to capture the moment, that really counts. It’s the difference between a pro and an amateur. The real victory happens before or after hours, before or after a game, when no one is watching. It’s when the pro athlete or the pro business leader is alone. Are they getting an extra work-out in? Are they pouring over the company’s numbers? Are they reading about how to scale? Success is not about natural skill or ability; it is all about hunger and resourcefulness. There are no participation trophies on the road to success.

When you are putting in the time, energy, and extreme focus to accomplish your goal it’s going to be messy. Think about your favorite TV show. You’ve got hundreds of cameras, a catering crew, props, trailers, cast members milling about, wires running everywhere. It’s a complete mess. But when you settle down to binge watch The Suits, it’s pure art. Behind the scenes of business or a fitness competition isn’t that different. Things are breaking, employees leave, your feet are bleeding, but it’s those moments of pain, that if you can endure them for long enough that ultimately leads to success.

Emotional fitness is your ability to stay focused on a singular task that leads to the greatest result over time. I’m really practicing my emotional fitness right now as I’m in the home stretch to Lake Placid. Think about emotional fitness like this: If you hold your hand over a flame, you’ll likely rip it away as soon as you feel the heat. You put your hand over the flame again, and again you rip your hand away. You do this over and over. You can’t take the heat. You can’t take the pain. But… as you develop emotional fitness, you are able to hold your hand over the flame for longer amounts of time. You are able to endure the pain, just a bit longer. As you do this, your baseline for pain increases and you’re able to take on even more the next time. Over time, overall, your life improves! But how many of you rip your hand away from the flame before you’ve really tested your limits? What are you ripping your hand away from? Ultimately, you’re moving away from lasting success. Hold the line longer today and then tomorrow. Incremental growth will lead to geometric growth.

And, as I said before, though it bears repeating, no one is going to see you test your limits. This is all going on behind the scenes. It’s those day long training sessions. Those late nights working on your blog. People are going to call you crazy. Let them. Be committed to running your own race and to hell with the naysayers. You may not be smarter or physically stronger, but you can beat people mentally. You can out-work and outlast the competition. It’s not going to be easy, but it will be worth it.

I’ve endured the past 365 days of training. I’ve endured the past 10 years of building 5 business with 40 employees and over 300 independent contractors. Now it’s time to execute, to deliver, to celebrate. But only for a minute. Then it’s back to the grind. Because that grind is the real success.

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The Big Impact of Little Moments

moments

I hope everyone had a wonderful 4th of July holiday with their friends and family! There’s nothing like a good old-fashioned family BBQ, parade, or fireworks display to remind you to slow down and be present (it’s hard to check email on your phone when you’re manning the grill or chasing your kids around the yard!). These are moments and memories that will truly last a lifetime. I guarantee your kids will be reminiscing about these times together 25 years from now when they’re hosting their own family gatherings. It’s easy to make holidays special, but how do we channel that energy and presence into every day life? How do we make every moment count? How do we create defining and memorable moments every day?

Last week, I read the book, The Power of Moments by Dan Heath & Chip Heath, and it really resonated with me as a father, a husband, a friend, and a leader. The concepts are simple, but so applicable to every aspect of life. From your relationship with your partner to the experience you create for your clients, it’s all about little moments of surprise and delight. The beauty of this concept is that it costs little to no money – when you’re talking about the power of moments, it really is the thought that counts – the more novel the better. Think about this, up until your mid-20s, so many moments are new, exciting novelties (your first kiss, first night away from your parents, first beer, living on your own, moving in with your partner, marriage, etc.) As you near your 30s, these novelties decrease and it’s easy to get stuck living the same life year after year. And if you’re feeling this, imagine how your co-workers, employees, clients, and customers feel? There is a huge opportunity to create new moments for your customers and that is something they are not going to forget anytime soon (considering it could be the only surprising moment they’ve had in years!).

About a week ago I challenged my team CEOs to test out this novelty idea with their children, partner, or a complete stranger. Again, the novelty didn’t have to be extravagant, the simpler the better. It was all about disrupting their daily routine and creating a moment, that could turn into a wonderful memory for the recipient years from now. Here are some of the moments that were created in less than 24 hours:

  • Met [my wife] at the new house we’re building to check on progress. I was coming from the office and beat her there. I picked some wildflowers and gave them to her when she pulled in. Cool novelty moment for sure!
  • Well in one hand I had a jug of washer fluid for [my wife’s] car and she thought that was so sweet! And then Boom!!! Flowers in the other hand! [She] loved them both! Thanks for the reminder!
  • Took my daughter to her favorite place to eat (after telling her I was cooking a meal I know she hates).
  • I texted some very special people in my life this message: “Hola, Today I was reminded to let the important people in my life know that they are special and they make my world go round and a better place. That person would be you 🙂 Thanks so much for being in my journey and I honor the light in you. Xoxo.”
  • I brought home treats for the kids last night and brought in breakfast for my team this am!
  • I got my girlfriend some flowers, she had a huge smile on her face. I got [my Executive Assistant] a gift card from PetSmart for her 2 cute little puppies that she adores!!!
  • Over 11 years ago, I was diagnosed with stage 4 endometrial cancer that required extensive treatment and surgeries. SOMEHOW [my husband] was attracted to me during this time and was doing everything in the book to get me just to date him. He was taking me to and from doctor’s appointments and since I couldn’t hold anything down at the time, he found that I was only able to hold down a Wendy’s Frosty. For MONTHS at a time he would ring my doorbell and leave a Wendy’s Frosty on my doorstep (not the smartest move considering we live in Texas and you can fry an egg on the sidewalk), but nonetheless, it was the thought that counts! Yesterday he walked in carrying 2 Frosty’s one for me and one for our sweet [son], It was [our son’s] very first time experiencing the deliciousness of a Frosty and for me….it had been over a decade since I last had one. It was the best reminder of  how blessed we truly are. The moment was priceless… Adam, thank you for pushing [my husband] to be the best version of himself!

The really cool thing is that these moments were just as incredible for the GIVER as they were for the receiver. Even my team who were just reading the responses were inspired and moved. One small moment can have a ripple effect. Take this concept and apply it to your business, your career, your home life, and your daily interactions. What an incredible impact you could make in the world!

Now, I will challenge all of you to do what my CEOs did. Go create a novel moment for someone and share it in the comments! Let’s inspire each other to be better, to do more, to give more. You can transform a life today.

Speed Interviewing: The Best Screening Interview Questions to Ask Candidates

interview

It’s Summer in Vermont. Yes, I know we’re known more for being a quintessential Winter Wonderland. And, yes, winter does pretty much last for six months. But have you seen Vermont in Summer? That is when Vermont really shines. The days are long and hot. Nature becomes our playground – from kayaking and swimming in the lake, to hiking and biking in the mountains, to exploring farmer’s markets and vineyards during the day, to tasting craft brews and listening to live music in sprawling fields at night. Vermont is where people come to live, work, and play. We’ve got the live and play thing on lock (and the media tends to focus on that). But we’ve got the whole work thing down too. Vermont is full of nationally renowned employers, global enterprises, entrepreneurs, and small business owners. The innovation is real. So is the war for talent.

The Federal Reserve estimates that the unemployment rate is going to be 3.5% by 2019, and we’re already at 3.8%. What does that mean for growing companies? It means that the pool of people actively searching for jobs is smaller. Top talent is already out in the workforce kicking ass. It means that employers need to be even more aggressive and diligent about sharing their mission and vision and attracting talent to them (which sometimes means selling them on the maple syrup and mountains too). In fact, now more than ever, you’ve got to be a corporate talent scout. Professional sports teams spend billions of dollars and many, many years on scouting for and building a bench of talent (sometimes as early as middle school!). Are you that committed to talent acquisition for your organization? At our company, we have one of our best people (my Chief of Staff, Hallie Warner), constantly screening, recruiting, networking, connecting, building relationships, and building a bench of talent for current positions, as well as for positions we’ll need to fill 3-5 years from now. We are deeply committed to building a pipeline of talented people and keeping our foot on the gas in order to grow the business through others. This also means that while we’re out hunting and fishing for talent, we have to be cognizant of where the top people are hanging out. It’s not enough to just go fishing for talent, you’ve got to fish from the highest level talent pool you can think of.

We have found that while we get hundreds of resumes a month, we may do screening interviews with only 20% of those, and then less than half of those candidates will make it to round two. Because of our incredibly high standards and uniquely fast-paced, results-oriented organization we need to get in front of a lot of people in order to bring only the best of the best into our world.  Sounds like a tall order for our hiring managers, right?

Well, it is! However, we’ve gotten pretty good at spotting talent and one way we create massive efficiency is by having mastered the screening interview. Like I mentioned before, we may screen 10-20 candidates a week. And 2-3 of those candidates will move forward to an in-person, in-depth interview. So, how do we get through that many candidates quickly, while still learning a great deal about whether or not they will survive and thrive in our organization? It’s all about the art of the 15 minute screening interview (which we do over the phone to save even more time for everyone).

Why the screening interview? It’s a great way to save time and identify the top talent to take through the rest of the hiring process. It’s a efficient way to review their resume and their track record of success. It’s a place to evaluate their communication skills and their email etiquette (usually while scheduling the phone interview).

During the screening interview we’re not so much looking for specific answers, as we are about what is and isn’t being said. We’re on the hunt for information that we can use to determine if they are the right fit for our company, for this position, or for another opportunity in our company. How quickly do they respond to answers? Are they internal or external processors? Do they give concrete examples or skim over the question? Do they have goals? Do they have daily success habits? How self-aware are they? Can they admit to their failures and mistakes? Do they call you on time, three minutes late, or five minutes early? Have they done any research on your company – if so, how much? What kind of questions do they ask? Do they even have any questions?

You’ve only got 15 minutes, so ask great questions and listen carefully. Below are some of our favorite screening interview questions:

  1. What do you know about Adam Hergenrother Companies?
  2. What interested you most about this position?
  3. Is there anything that worries you about this position?
  4. How does your experience relate to this position?
  5. Why are you looking to make a change now?
  6. What’s your daily routine?
  7. What energizes you outside of the office?
  8. What’s the biggest misperception people have of you?
  9. What’s most important to you in your work?
  10. Tell me about a big mistake you made at work in the past 6-12 months. What did you learn from it?
  11. What are your personal and professional goals for the next 2-3 years?
  12. Why wouldn’t we hire you?
  13. What’s your timeline for making a move?
  14. This position pays between $X and $X. Is that consistent with your expectations?
  15. What questions do you have for me?

After, the initial screening interview, if we determine that the candidate might be a good fit for either that position, or another position in our company, then we will invite them to take our behavior assessment and come to the office for a second interview. Getting in front of as many potential candidates is critical and the screening interview helps us do that efficiently.

A few things to note:

  • Make sure you tailor your screening interview questions to the specific position as needed
  • If you are doing a general talent meeting, prep questions that will identify specific behavioral traits you are looking for or overall alignment with your company and culture.
  • State and federal employment laws are constantly changing. If you are ever in doubt about what you should and shouldn’t ask, consult with your Human Resources team or your attorney.

We’re a fast growing company and the only way we are going to keep growing is to bring talented individuals into our organization. If you want to learn more about career opportunities at Adam Hergenrother Companies, click here.

Interested in learning more about our hiring process and how to recruit and hire top talent? Join me in Portsmouth, NH on September 13 & 14 for Career Visioning.

For a complete break-down of our screening interview process, check out our Director of Marketing, Erin McCormick’s webinar, The Art of the 15 Minute Screening Interview.

What screening interview questions would you add to this list?

Why Bad Burnout Happens to Good People

burnout

There is an interesting dichotomy in the professional world right now. On one hand we’ve got the workaholics and on the other we’ve got those individuals in constant search of work-life balance. The workaholics scoff at the idea of “balance” and those who seek balance don’t understand the relentless obsession of the workaholics. Who’s right? Who’s wrong? Well, it’s not as simple as that.

The workaholics are driven by and fueled by their chosen profession – it could be their calling, a desire to prove themselves to their family, or simply a need for a certain title or income. It’s about the work and what the work means for them – whatever the reason. Work often comes first and the workaholics are unapologetic about it. They don’t feel the need for a break from work because they typically enjoy what they do and don’t consider it work. Whether they are engaged in a side-hustle, on year 7 of their high growth start-up, training to become a professional athlete, or on the fast-track to making partner – workaholics are driven by their work. It may mean extremely long hours, personal sacrifices, working nights and weekend, but, again, for their own reasons, their work fuels them.

The work-life balance camp are looking for more separation, more boundaries between work and life. And they are unapologetic about protecting their time out of office. Up until around the 1980s, work-life balance wasn’t even part of our lexicon. It was just how the professional world worked. Most of the working population went to work and came home and that was that. Very few took work home with them and unless they were getting phone calls on their land-line or faxes at home, they were largely disconnected once they left the office. For the past 30+ years, as smart phones have gotten smarter and the competitive edge more competitive, the lines between “work” and “home” have become blurred. Workaholics tend to embrace this world. Work any time from anywhere – great! While the work-life balance individuals are rebelling against this new norm. Again, who’s right and who’s wrong?

I tend to fall somewhere in the middle. I believe there is a time and place for workaholism. In fact, my company is at a place in it’s growth where we need and want workaholics to grow alongside us. Instead of trying to get them to work harder, answer emails “after hours”, or chip in and help out with a project on the weekend, they are already there, sleeves rolled up, ready to get dirty and get the job done. The challenge I tend to have with my team is getting them to leave the office at a reasonable hour or take a vacation. That’s not a bad problem to have in my opinion.

And when it comes to work-life balance, I believe in work-life integration.

Here’s what work-life integration means to me: It’s the daily integration of growing, working, and playing. Now, before you get hung up on the playing part (I’m talking to you, workaholics!), remember it doesn’t mean your play needs to be 7 hours a day, it can be 30 minutes or an hour or two, depending on the day. The key is that each day you are 1) putting particular focus on growing yourself, 2) working hard on the most important task or project that will have the biggest impact on your business or job, and 3) playing and enjoying life. As a leader, it’s my job to make sure that my team is constantly touching all three of these areas each day. Integrating their work, their life, their family, their growth as much as possible day after day until it is a continuous loop of consistent growth. 

After all, there are 168 hours in the week and those people who are after work-life balance, aren’t looking to work 84 hours! And neither am I. I believe that if we are aligned with our natural behavior and doing work that fulfills us (no matter how many hours a week we do it for), we’re not going to feel like we’re a workaholic nor are we going to be searching for more balance. If we’re in alignment, it’s going to feel just right.

Regardless of my take on this whole work-life balance vs. workaholism thing, as leaders, we have to keep an eye on our team. When we work at the pace we do, really for any start-up or high growth company, you have to keep an eye out for burnout of your employees. We must manage our employee’s energy, their work-load, and what they are focused on. We must pay attention to when they need a break and need some rest and recovery time. It’s not as simple as time “on” and time “off” though. Most of my team, myself include, would rather be working than doing pretty much anything else. Who am I to tell them not to do what they like to do!?

But what we do need to watch out for is real burnout. Burnout is defined as the mental or physical collapse caused by overwork or stress. Rest and recovery time are critical for this. Taking time to unplug, exercise, get outside, or watch a Walking Dead marathon, all have their time and place. The piece I want to focus on here is stress.

Burnout doesn’t happen from the number of hours worked or even from the intensity of work. Burnout happens for a couple of reasons:

  1. When you are not growing.
  2. When you are out of alignment with your natural behavior.
  3. When you are not having success for an extended period of time.

So if you’ve got a company or team of workaholics how do you help them avoid burnout?

First, make sure you have a clear understanding of your direct reports’ goals, personally and professionally. Are you meeting with your team regularly. Are you encouraging them to take on a new project and pushing them to get out of their comfort zone? When you’re not growing, you’re dying. If your team members start to feel stagnant, or feel there is no room for them to grow at you company, the work they do tends to become less engaging and can lead to stress, which leads to burnout. Make sure you have a clear growth plan for each of the positions in your company and communicate that often. Not everyone will take you up on it. But knowing that growth is available is often enough.

Do you understanding the natural behavior of each of your team members? Do you know how they respond to stress? Do you know what work environments they thrive in? Do you understand their communication style? If you answered “no” to even one of these questions, it’s time to do a deep dive into your team members’ personality and behavior. There are a ton of free assessments on the internet – check out the DISC or 16 Personalities to start. Once you have a clear understanding of their behavior, you’ve got to ask yourself if they are in the right position in your company to achieve success. For example, if you have a High I personality (see DISC profile), and they are in a data entry position, with little people contact, that is a complete mis-match. Now, any intelligent individual can learn and perform a job. But they are not going to be fulfilled, they are going to be stressed each day operating outside of their natural behavior and if that goes on for too long, it can lead to burnout. Again, burnout isn’t just about numbers of hours worked, but time spent on projects, tasks, or in a job that is not the right fit. Matching natural behavioral styles with the behavior needed to thrive in a position is the cornerstone of our hiring practice. However, occasionally, mismatches occur. If you know your team, you can spot this and avoid burnout by shifting staff or tweaking job descriptions. In my opinion the fastest way to burnout is if people are in a company that they love, but a role they hate. And if your team isn’t aligned with the mission or vision of the company or their leader, then burnout will happen much, much faster. Make sure people are not only aligned with the right position for their behavior, but with where you and the company are going.

Burnout also occurs when an individual is failing over and over and over again. Okay, okay, yes, I am proponent of failure and failing forward. But there comes a point where a team member can just be banging their head against the wall, trying to get through, and nothing seems to be working. Failure like this, for a long time, with no clear wins can be exhausting, deflating, and can cause burnout. This is where you need to step in. Does your employee need to step back and take a day off? Do they need some additional training? Do they need to be taken off the project or have someone else come in to help? Is it simply too much work for one person? Does your employee have the skills to accomplish what you are asking of them? Do they need help re-prioritizing or chunking down the project into bite-size pieces so that they can accomplish one small part and have a victory and then build upon that? Going too long without any success, no matter how small, is discouraging and stressful, which leads to burnout. Help your team member get a win that they can build on.

Burnout can happen to the best of us. And as a leader, it is your responsibility to keep an eye on your team, watch for signs of burnout, and mitigate it as much as possible. When your employees are burned out it can have massive financial repercussions for your company in the form of costly mistakes, missed opportunities, or having a skilled employee leave. For your team members, the cost could be even greater with effects on their mental and physical health. When you team members have got their heads down, getting shit done, it’s your job to keep scanning the room, the company, spotting the signs of burnout and redirecting focus for the good of your team and your company.

Have you experienced burnout or seen it show up in your company? What were the warning signs? What are you doing as a leader to mitigate burnout in the future?

 

 

 

 

Do You Have a Lead Generation Problem or a Lead Conversion Problem?

 

leads

15-3. That’s the battle cry of our expansion real estate team, Hergenrother Realty Group. 15 minutes of script practice, followed by 3 hours of lead generation every morning. Well, I say lead generation lightly. We’ve been calling it that for the past 6 years (and as an industry on the whole, we’ve been calling it that for decades!). But our team has been making a mindset shift over the past couple of weeks from lead generation to lead follow-up. Because the reality is, our team doesn’t need more leads. They need to follow-up and convert the leads they have.

Do you have a lead generation problem or a lead conversation problem?

I’ll make it simple for you. 80% of you have a lead conversion, a lead follow-up problem, NOT a lead generation problem. This is not unique to the real estate industry, but any sales profession. Take a look at the number of people in your database. If you have more than 100 names (and I’m sure some of you have more than 1,000 leads between online leads, sphere of influence (SOI), open house leads, etc.), then you don’t need more leads! You need to learn how to master the boredom of extreme follow-up and conversion. Our team isn’t even calling it lead generation any more! It’s lead follow-up. Sure, I would encourage them to lead generate for maybe 30 minutes a day. But the secret to success is in the follow-up. That’s where the money is. 3+ hours a day of follow-up and your career will be made. Don’t commit to 3+ hours a day of follow-up and you’ll continue to ride the sales roller coaster, a few sales one month, and then no sales for several months. That is no way to build a career, a business, or a life.

Let’s break this down:

Lead Generation – The process of procuring new names and contact information for your database. This can be done online, through networking events, sales seminars, product demonstrations, open houses, etc. Yes, you do need to add new names to your database regularly. However, most sales professionals are either on a team or part of a company that generates the majority of the leads for them (through radio ads, online leads, direct mail advertising, etc.).

Lead Follow-Up – The process of calling, texting, emailing, dropping by, Facebook messaging, etc. existing leads between 6 and 12 times in order to connect. And when they tell you no, you put them on a follow-up campaign to reach back out at a later date. It’s never a NO, it’s just a not right now. Be there and be ready for these leads when they do finally raise there hand, because they will.

Lead Conversion – You have made contact! Maybe you’re having several conversations and are starting to develop a relationship (clients for life, am I right?). Time to move them out of the friend zone and into a paying customer. Conversion is all about getting a lead to say yes to whatever you are asking (usually a sale or potential sale). They have committed to working with you and your goals are aligned. This comes with a lot of practice (yes, knowing your sales scripts), but even more importantly understanding your industry and the market backwards and forwards, being a master of practical psychology, and being able to consult with your lead, understand their goals and their challenges, and provide the solution for them. Conversion complete. However, conversion’s not going to happen if you are not relentlessly following-up.

Need even more convincing that lead follow-up is the game you have to play to win? Check out these stats:

  • You must respond to online leads in less than 5 minutes (30 seconds is better). After 10 minutes your qualifying rate drops by 400%.
  • You must attempt contact with a lead 6-12 times before a connection is made.
  • 80% of real estate agents give up after the third contact attempt!
  • Potential buyer/seller leads are entering their contact information on an average of 19 websites. 76% of them will work with the first agent or team that contacts them.
  • Over 30% of leads are never contacted by a sales representative.
  • The best time to call to qualify a lead is between 4pm – 5pm, the second best time is 8am – 9am.
  • Wednesdays and Thursdays are the best days of the week to qualify leads.

What does that mean for you? You will have a competitive edge by just calling and following up with at lead! Speed to lead is critical. And never, ever, let a lead go untouched.

Your database of leads is your bank account. There could be tens of thousands, hundreds of thousands of dollars, just sitting there waiting for you to make your move. Forget about generating leads. Make it all about the follow-up, before, during, and after you’ve made the sale. That’s right, just because you’ve made a commission, doesn’t mean you get to walk away from that lead. That was one sale. How about their friends, family, colleagues? Did you get a referral? What about 3 years from now when that client moves? Or two weeks from now when their parents are looking to downsize? Will you be the first person they thing of, the first person they call? Probably not, unless you have developed some sort of post-sale follow-up system. This one lead, could generate 5+ more leads! Check-in regularly, invite them to community events, send them handwritten notes every time they have a milestone in their life, email them discounts or articles of interest – provide value and keep your name in front of them (by the way, most of this can and should be automated). Follow-up, follow-up, follow-up.

No matter what industry you are in or where you keep your list of contacts, go take a look at your database right now. How many potential clients do you have right in front of you? How many of them have you talked to recently? Following-up is the first step towards conversion. Get after it.

 

The Culture of Convenience

convenience

“A man who dares to waste one hour of time has not discovered the value of life.” – Charles Darwin 

On any given day of the week, I ask Alexa to add vegan protein powder to my Amazon cart or I ask Siri to text my assistant to rearrange my week’s calendar. I have a pulse sensor hooked to my iPhone to monitor my physical and mental stress (and then either rest or push harder depending on the reading). And my wife orders the majority of our groceries online (got to love Thrive Market and Prime Pantry!). In the winter, I remote start my car (which is perfectly programmed to exactly the temperature I like). When traveling, I save two minutes by taking an Uber rather than a taxi. I use EZ Pass (yes, even when I don’t have the EZ Pass for that state because I’d rather pay a $4 fine then slow down!). I shave even more time off airport security by using kiosks and pre-check so I don’t have to wait in line. I live firmly in the culture of convenience and I wouldn’t have it any other way. We literally have almost anything we could want at the tap of a screen on our iPhones. I hate waiting and I hate wasting time. I will continue to automate (and optimize) as many areas of my life as possible to buy time in order to experience more of life!

This isn’t a new phenomenon, just something that is more evident today because of how rapidly we are innovating and automating (and talking and sharing about it on social media). Back in the days of the cave men, once they learned how to make fire – their lives leveled up. Instead of spending hours and days searching for food and nutrients, they learned how to cook and preserve food, so their time spent hunting and gathering evolved into time spent learning, making better weapons, communicating, socializing, strategically finding better hunting grounds, and thinking, which led to more innovating. That is when man’s mind evolved. We are on the cusp of another social [re]evolution.

And this time, it’s all about time. Benjamin Franklin said, “A penny saved is a penny earned.” I say, a minute saved is a minute invested into the progressive realization of humans as spiritual beings. I know, I know. Let me dial back the “woo-woo” a bit.

This culture of convenience we live in is all about buying time. Some might call this cultural shift towards automation and instant gratification lazy, impatient, entitled, or attach some other negative connotation to it. But that’s not really the point. Sure, I’m impatient and don’t want to spend time fighting the crowds at the grocery store (hence why I will either outsource my grocery shopping to a local service or simply order groceries online). But it’s more than that. It’s not just about NOT doing something I don’t want to do. It’s about spending that hour working on a new business idea, making breakfast for my wife, writing content for my book or blog, or swimming with my kids instead.

Time is the greatest gift. Time to spend on what is most important to you. If you love grocery shopping. Awesome! Automate or outsource another area of your life so you get to spend time doing what you enjoy, something that will make a positive impact on your life, your family, your business, and your community. The culture of convenience is not about stagnation and the status quo, but about leveraging technology to buy time in order for us to grow as individuals and as a society.

Companies like Hello Fresh, Amazon, and Uber have it right. These services allow us to measure our days in minutes and maximize our time for maximum results. As these, and more companies grow, we’ll continue to have more time in our day. Enjoy it and embrace, but choose how you use that gift of time wisely. If done right, you’ll evolve and grow. Done incorrectly and you’re stuck in mediocrity. When you have more time, you will be able to think more, learn more, exercise more, knit more, and simply have more “you” time. After all, isn’t that the point? To stop doing the things that are necessary, but monotonous, and spend more time on experiencing life your way? In order to have more spiritual growth through experiences, then we need more time to have more experiences! It is a beautiful, virtuous cycle if we embrace it.

The world is changing. You can either evolve as a person (in your company, your career, your marriage, your life) or you will be forced out or left behind. It’s natural selection in action. Where will you be on the other side of history?

The Hardest Part of Building a Business is Dealing With People

people

Last week I was at a neighborhood event and ended up chatting with the CEO of a major global company headquartered here in little ‘ole Vermont. Naturally, our conversation quickly shifted from the weather to business (okay, who am I kidding, there was no small-talk). The total people count in my organization (between full-time staff and independent contractors) is just over 300. This CEO’s ultimate span of control crosses oceans and encompasses over 1000 people. Despite the differences in our company’s size, the challenges remain remarkably similar and they all revolve around dealing with people.

People. Can’t run a business without them. Yes, even with onslaught of AI and systems of intelligence, we’re still going to need people. We’re never going to be able to get away with automating every aspect of business. Certain tasks and processes? Sure. But that just means new jobs are going to emerge for people to help implement and manage these automated systems.

So, what does that mean for you? We already know that building a business is hard. Let’s say you are building a business based purely on your own entrepreneurial efforts – you’ve built out a website, integrated an ecommerce platform, positioning yourself as a thought leader in your industry of choice, and are cranking out free content daily while developing your sales funnel so that you can eventually convert those raving fans and followers into paying clients. Eventually, you get to a point where your platform is cranking – you are collecting payments for your ebook or webinar series while you sleep. While you’re awake, you continue to streamline your sales cycle, answer every customer, engage on social media and continue to create valuable content. Sales increase. Engagement increases. You begin to get speaking, podcast, and guest blogger requests. Your customers are asking for new products, yet you can no longer innovate because you’re simply responding to current sales. This is the tipping point where you must make the choice to A. Remain self-employed (and likely scale back on your product or service offerings) or B. Dive into building a business (which means hiring people to support your existing business and then eventually scale).

You choose Option B. You thought what you had been doing was difficult before? You thought the hours were long? You were fueled by an internal drive, even fueled by the problems, the challenges, the stress, but thought that hiring a person, or several people, would offer you some relief from the grind? You thought wrong. When you start to add people to your organization and have to succeed through them rather through your own grit and determination, you’ve added a whole other level of “work” to your work. Instead of succeeding through your own sweat and tears, you have to worry about you employees’ sweat and tears (sometimes literally). And not everyone is cut out to deal with those kind of issues or deal with people problems on a daily basis. That’s really the difference between someone who is self-employed or an individual contributor in a business and a business owner or leader within a company, respectively. Can you bring together people to work towards a common goal, influence and inspire action, and cultivate creative problem solving all while creating a strong culture where people want to work? That is a hell of a lot different than creating a website, sales funnel, and developing content.

When you choose Option B, the real work begins. When you decide to build a business through people, it’s easy to just let go of the reigns and allow other people to start doing the work and making decisions on your behalf. Leverage, am I right? That’s why you started this whole thing in the first place. But just know that when your business starts walking, talking, and making decisions without out (i.e. your employees) there are going to be mistakes and problems, sometimes very expensive mistakes. This is where it really gets tough. Will you be able to whether the storm of growing your business through people? At this point it becomes more than just profit. People’s lives are at stake (your family, your employee’s, their families, and ultimately the legacy you are building to leave behind).

Make sure you are really sure about what you are getting yourself into. Often your top sales person, best player, or most highly skilled developers (which could be YOU!) are just not meant to be leaders. Look at professional sports – very few coaches actually ever made it as professional athletes and those top athletes? You got it, not meant to be coaches. So if you find yourself at that crossroads and trying to decide whether or not you really want to take your business to the next level, you have to understand that it will become less about product development and all about people development. And if that is not okay with you, then you are still going to need a person – you’ll just need to hire someone to handle the people side of the business, while you keep doing your thing.

Again, let’s assume you’re all in and are ready to shift from being the player to being the coach. First, you’ll have to wrap your head around a few things:

  1. No one is ever going to want your company to succeed as much as you do.
  2. You must master leverage (i.e. recruiting and hiring).
  3. Your two most important jobs will become personal development and leadership. And you can’t have one without the other.
  4. You will be responsible for every failure and will have to give credit to someone else for each success.
  5. Your business and your “success” will go backwards for a few years and you’ll have to grind even harder than before in order to get back to where you were when you were doing it by yourself. But if you have the grit to stick with it, the pay off will be huge.

Pushing through the grind and coming out on the other side with your head above water will often take 18-36 months. Then it will be another 18-36 months to grow and scale. Yes,  5-7 years total before you hit your geometric growth. During that time you’ll be focused on people, people, and, you guessed it, people. You will add more people to your team, you will be leading those people, solving problems with and through those people, increasing sales through those people. It’s one thing to solve your own challenge with your own knowledge, business acumen, connections, natural sales ability, etc. It’s a whole other thing to solve those challenges through another individual. That’s why you are no longer in the software, content, social media, real estate, fitness, etc. business. You’re in the people business. And with more people comes more problems. Problems that you never thought you were going to face are going to show up – lawsuits, interpersonal drama, people quitting, haters, groupies, and more! For 5-7 years….

Then one day you get the breakthrough you’ve been waiting for and your geometric run has begun. Your income doubles every quarter, momentum is strong, people are knocking down your door to work for you. And then people start to congratulate you for your massive overnight success in the past year. Bullshit. What about the last 7 years? People will forget that you worked your ass off for the better part of a decade, shouldered the challenges of your organization, as well as all the people in your company – daily. It is one of the hardest, yet most rewarding things you can do in your life.

Leaders are not born, they are made (over many years of challenges, sacrifices, hard work, and failing forward). If I haven’t scared you off after this blog and this journey of massive challenge, massive growth and massive reward is still for you, then commit right here, right now, in this moment. If it’s not for you (which is totally fine!), then go find someone who is committed to this journey and figure out a way to get into their life. Either way, buckle up, it’s going to be quite the ride!

 

 

Why Are Real Estate Companies with Zero Profit Being Valued at Billions?

wall st

$18.6 Million. $36.4 Million. $10.7 Million. Nope, those aren’t profit numbers, or even revenue. Those are the net losses sustained by Zillow, Redfin, and eXp, respectively, in the first quarter of 2018. And yet, those three companies combined are valued at over $3.3 BILLION dollars. How? Why? Why are these real estate companies receiving massive valuations when they are not even turning a profit?

In this new era of technology, the 4th industrial revolution, Wall Street is buying into the negative losses and placing bets on which real estate company will be able to “Amazon it”. These real estate companies are betting on themselves too, along with private equity firms, that they will be the next Amazon, except that there is only one Amazon. And only one, maybe two of these real estate companies are going to have explosive success, everyone else is going to lose.

On the other hand, Realogy, Remax, and Keller Williams Realty (if it were publicly traded) are valued at $3 Billion (Realogy) and $1.6 Billion (Remax), the difference is they are all highly profitable. But Wall Street continues to bet on eXp, Redfin, Open Door, etc. to be the ONE successful tech disrupter instead of betting on proven companies with positive cash flow. It blows my mind that companies can have such massive loses ($36.4 Million in one quarter!) and yet still be valued at over a billion dollars. And these aren’t just loses for one quarter, these loses are over several years and continue to increase year over year.

How can these companies sustain such loses and keep pushing forward? Why are they okay with such big loses in the first place? Well, venture capitalists and private equity firms are injecting money into those organizations (based on the hope that they will be one of the few successful tech disrupters). With these huge cash infusions, these real estate companies don’t actually have to figure out how to make money, it just shows up. They are not holding their money accountable. Sure, many of these companies are increasing their revenue, but they are also increasing their expenses, and thus their losses. Now, I’m not saying capital contributions aren’t helpful for fast growth. They can be a great way to hire more people and to build a stronger business foundation through systems and technology. But how much risk, how much loss is too much? Is there a smarter and more sustainable way to grow?

I think it should be noted that Warren Buffet got into the real estate game, but bought a profitable business; he didn’t invest into technology. He is looking for a cash on cash return while Wall Street and private equity is looking to make a fortune at each evaluation and round of investing. We’re seeing the largest growth in real estate right now, and venture capitalists are naturally hoping to capitalize on that. I’m not knocking their method; they are playing the game effectively. But what happens when the market shifts? What happens when Wall Street says enough? A shift in the economy could end the game. They will just loose more and more money. At some point it becomes unsustainable.

What we’re doing at Hergenrother Realty Group, and many other Expansion Teams are doing around the country, is quite similar to Redfin, eXp, and Compass. The biggest differences are that we are building these big companies within an existing real estate company that has proven systems and infrastructure, zero debt, and high profitability and we’re doing it at a slightly slower pace (to maintain said profit). We may not have these high valuations and capital injections, but we have profit. Other companies are not holding their money accountable. We are. Think of it from a personal perspective. When  you only have $100 to spend, you look closely at where even penny is going. When you have $100,000 in the bank, spending $20, $50, or $5 here and there doesn’t seem to make a difference… but it adds up. Quick. If you make $100K, but spend $150K, then you are worse off then if you made $50K and only spent $40k. It’s simple math.

If nothing else, it is a definitely an exciting time to be in real estate. The 4th Industrial Revolution is here and we’re just starting to scratch the surface of what that means for real estate and business in general. As challenging as it will be over the next few years, I wouldn’t want to be anywhere else. It’s those are that are hustling, that are grinding, that are in the arena, who will ultimate succeed when this all shakes out. I, for one, look forward to being part of history.

 

 

 

 

The 3 Key Hires You Need for Any Business

hires

“You don’t build a business.
You build people, and people build the business.”
-Zig Ziglar

Whether you are a sole-proprietor looking to grow your retail store, an investor looking for their next project, a CEO of a multi-million dollar conglomerate, or a small online business owner, you need people to help your business operate, grow, thrive, and survive. If you don’t want to hire and lead people, that’s fine too. But that is not running a business. Read more about that in a blog I wrote last year called 5 Things You Need to Decide Before You Become an Entrepreneur.

So, let’s assume you have your heart set on building a business. Great. It’s time to invest into people. But who do you hire first? I actually don’t think the answer to this is as cut and dry as one might think. It all depends on you – your natural skills and behavior, and your goals. Let’s say you are a master salesman, well, your first hire then shouldn’t be another sales guy. Hire someone who can fill in for your weaknesses (likely an administrative or operations professional). If you get lost in spreadsheets, love to organize and analyze data, and find enjoyment in creating detailed business plans, then it may behoove you to hire that sales guy!

Regardless of where you land, there are three key hires you will need to make in order to build a solid foundation, successfully operate your business, and ultimately grow. Now, one of these people may be you for a period of time. That’s fine, hire the other two first. However, eventually, if done right, with the right people, you will get to a point where you will have to replace yourself too. I was the sales guy for a while. That was the last piece of the puzzle that I hired for, but I hired administrative/operational and finance staff almost immediately once I knew I wanted to build a business.

Here are the three key hires you need for any business:

  1. Administrative/Operations Staff – Whatever sexy title de jour you choose to use – COO, Executive Assistant, Director of Administration & Operations, Chief Chaos Coordinator – this person will be your organizational and operational wizard. This hire is usually a Jack or Jill of all trades – they are essentially handling everything but sales, assuming you hire this person first. They may manage your personal life, creating systems and process, recruit and hire other team members, HR, bookkeeping, training staff, marketing, and more. As you leverage everything to this person, you are able to focus more on sales and eventually will reach a critical tipping point where this role begins to break off into more than one position. Usually financials (if you haven’t already leveraged that piece) will move first, followed quickly by the EA/PA portion of the position, so that your Jack/Jill of all trades becomes a full on Operations expert who will focus on running the business.
  2. Finance Staff – Is this a bookkeeper? Controller? CFO? Depends on the size of your business. Start small and allow the person to grow with your company, or top grade if necessary. Whatever level this person is at, their basic responsibilities remain the same, handling the financials – from budgets, to billing, to cash flow and expense management.  This person will work incredibly close to your Operations staff  member to handle all the day to day functions of the business, as well as help you plan for and manage growth. Having someone’s eyes on the money at all times is critical, especially in a high growth company where you have to play the money matrix game – constantly shifting where money goes so that it has the most impact and ROI. Without accurate and timely financial data, as a business owner, you could be left in the dark. The financials are critical for making smart, well-informed decisions that could either make or break your organization.
  3. Sales Staff – In my case, this was the last piece to be leveraged. Whoever you choose to lead the sales efforts of your organization must be able to do it better than you (and as the leader of the business, those are big shoes to fill). Sales drive the business, we know this. The more sales, the more clients and customers, the bigger profit, enables you to circle back and add additional operations staff and sales people and it becomes this beautiful, virtuous, cycle. I don’t care what business you are in, without sales, you don’t have a business. Which is why this is usually the last position that a leader will leverage. As this sales staff member grows, they will be responsible for sales goals, as well as for recruiting, hiring, and training additional sales people. Again, sales drives the business.

Operations. Money. Sales. The three pillars of any good business. Now, these are not your only three hires, but they are the first key hires of your business. As your company grows you can start to hire those “value add staff” like that Chief Fun Officer or office Massage Therapist. But find those three incredibly talent individuals to run each component first, then get out of their way, and watch your business grow.

Would you add any other critical team member to this list?