“How do you lead when the team starts growing beyond 30 people?”

When you hit that size, everything changes. Communication breaks down. Priorities fragment. You can no longer rely on charisma or tribal knowledge to keep momentum. The fun of growth comes packaged with complexity and a relentless demand for clarity.

I’ve learned this firsthand.

Over the past decade, I led a ~50-person entrepreneurial team at UGURUS, then stepped into business unit leadership at Cloudways and DigitalOcean, working inside companies of 300 and 1,400 people. Today, I am the CEO of E2M, a 300+ person white-label digital agency spread across WordPress, web design and development, Shopify & BigCommerce development, SEO & PPC, and AI services. Along the way, I have borrowed what works, thrown out what doesn’t, and adapted systems from very different company cultures.

This is the CEO operating system I use today. It is still evolving, but it has given us focus, transparency, and momentum across hundreds of people.

The goal is simple: clarity at scale.

Vision: Pick the Hill

Jim Franklin once told me a CEO’s job is to clearly articulate which direction the firm is going. There might be a red hill or a blue hill. You have to choose. Red hill or blue hill. Red hill. Go.

At UGURUS, I ran the Vision Traction Organizer (V/TO) from EOS and loved the simplicity of putting mission, vision, and 3-year strategy on a single page. When I moved into larger organizations, I was exposed to the Strategy on a Page (or SOAP for short). It serves the same purpose but includes more specifics about where the company is competing and how.

Your vision must be short enough to remember and strong enough to align hundreds of decisions.

If your people cannot tell someone else where you are going, you are not leading.

OKRs: Turning Vision Into Movement

I spent almost ten years with EOS. Rocks are a great tool for entrepreneurial teams. But once you get into big companies, Rocks start to feel too vague. Too binary. Too shallow.

At Cloudways and DigitalOcean, I lived inside OKRs: Objectives and Key Results, popularized by John Doerr in Measure What Matters. OKRs take the simplicity of Rocks and add rigor.

Objectives: What we are trying to achieve. Inspirational. Directional.

Key Results: How we will measure success. Specific. Verifiable. Time bound.

The beauty of OKRs is that they scale. From one CEO objective to thousands of team-level commitments, all rolling into a cohesive direction. At E2M we are now two quarters into OKRs. It is not perfect. Adoption takes time. But even early, the clarity has been powerful.

Cadence: The Drumbeat of Accountability

You can have vision and OKRs, but without a rhythm, goals rot.

Our core operating cadence:

Weekly Business Review (WBR)
Monthly Business Review (QBR)
Quarterly Business Review (MBR)

Every business unit leader writes a short narrative every week. Not slides. Writing. They report:

1. Top metrics and why results happened

2. Wins and highlights

3. Next week’s focus

4. Blockers and support needed

We read silently. We ask clarifying questions. We make decisions. We set next steps. One drumbeat after another.

I have tried meeting every other week. I have tried monthly. Accountability dissolves. Numbers drift. Issues pile up. Weekly is where the truth lives.

Writing Culture: Clear Writing Equals Clear Thinking

When I worked inside DigitalOcean, I experienced what a writing culture can unlock. Instead of talking in circles for 45 minutes, you read a page of deeply considered thinking.

Writing forces:

• Precision

• Evidence

• Ownership

If someone writes a compelling case for a change, I often say yes on the spot. No debate needed. The work is done.

These documents also become the record of how we think. How we decide. How we learn.

1:1s: Coaching the Humans, Not the Business

Weekly 1:1s with business unit leaders are non-negotiable for me. These are not status meetings. We already covered the metrics in the WBR. I mostly use the agenda from EOS Same Page meetings.

Agenda:

• Welcome, business/personal bests from last week

• Todo checkin

• Issues

• Close

These conversations catch human problems early. They build trust. They create the space leaders need to stretch.

When possible, I also meet with people two layers down. You cannot lead well from inside a filtered bubble.

Org Design: The Accountability Chart Is a Living System

EOS got this right. People issues are usually structure issues.

I treat our accountability chart like an engineer treats a blueprint. I am updating it constantly. Labels. Seats. Reporting lines. Resourcing.

If you want to scale leadership, you build it into the structure first.

Scaling Communication: Memos and All Hands

I am a remote CEO with a team primarily in India. That makes visibility harder. Writing solves this.

• Weekly written memo to leadership

• Monthly memo to the full company

• Quarterly all hands with OKR rollouts, recognition, and Q&A

If I do not repeat the story, someone else will replace it with theirs. We have to say something at least seven times before they hear it the first time.

What I Am Still Figuring Out

Leadership is never done. Here are places I am actively improving:

• Expanding OKR ownership deeper into the company

• Raising the bar on data literacy and business writing

• Pushing root cause analysis and first principles thinking

• Creating more working sessions that are as energizing as those in-person visits to Ahmedabad

• Finding new ways to be present with a global team and still protect focus

When you scale past 30 people, the job changes. You go from pushing the business forward to building the system that moves the business forward. Almost all of my business problems and opportunities can be distilled into people problems and opportunities.

That shift is the work.

My Advice If You Are Entering This Stage

1. Put your vision on one page

2. Share it so often people joke about it

3. Pick a cadence you can keep

4. Force clarity through writing

5. Develop leaders through coaching

6. Keep evolving your org structure

7. Communicate more than you think you need to

If you do these things, your company will move in one direction, together.

Because running a 30-person team and a 300-person company are not different jobs. They are different games. And now you are playing the bigger one.

From personal experience, I’ve learned that embracing challenge brings joy, fulfillment, and deeper connection. By sharing stories from business, life, and the trail, I hope to inspire you to step outside your comfort zone.

Let’s play a bigger game—together.

TL;DR

I'm raising money for cancer by racing the Leadville 100 MTB, one of the toughest mountain bike events in the country, on August 9, 2025.

👉 Click here to donate to First Descents
💬 Or reply to this post and share how cancer has impacted your life.

How I Ended Up Training for One Brutal Bike Race

10:50 PM is way past my bedtime.

But there I was, in bed, staring at a Google search:
“Hardest bike race in Colorado.”

I hesitated. Deep down, I knew that once I started this path, I wouldn’t stop.

That same day, I learned that UGURUS—the business I co-founded twelve years ago—was coming to an end. Despite several last-ditch efforts, it was final. The lights were turning off.

I sold UGURUS in 2021, but I stayed on to lead and grow it. Part of me thought we’d find another way. But when you sell, you give up your right to decide.

I needed something to pull me forward. Something hard. Something healing.

And I found it:
The Leadville 100 MTB.
100 miles. 10,000+ feet of climbing. All above 10,000 feet in elevation.

You can enter via lottery or raise money for a nonprofit. A quick search led me to First Descents—an organization supporting young adults impacted by cancer that I’d heard great things about (thanks, Marc).

“While the doctors and medicine may have saved my life, First Descents taught me how to live again.”
— FD Participant

By midnight, I had applied, blocked race week on my calendar, and closed my laptop wondering, “What the heck am I doing?”

Then it hit me:

✅ I hadn’t trained on a bike in over a year
✅ I don’t mountain bike

Plenty of time to figure that out… right?

Step 1: Getting in Shape

One reason I love endurance sports is their simplicity. The formula is straightforward:

1. Register

2. Build a training plan

3. Follow it

4. Avoid injury

5. Finish

I hired Boundless out of Boulder, who specializes in Leadville coaching. They paired me with Justin Ross, a Leadville finisher who’s trained many others to the start (and finish) line.

Shortly after, First Descents reached out—someone dropped from the team. A spot had opened, but I had to commit that day. A few emails and a signed agreement later, I was officially in.

🏋️‍♂️ Early Season Training Sample Week

• Monday – Rest or 1 hr Zone 2

• Tuesday – Intervals (60–75 mins) + Strength (30 mins)

• Wednesday – Zone 2 (1 hr+, outdoors if possible)

• Thursday – Intervals + Strength

• Friday – Long Ride (5–6+ hrs)

• Saturday – Zone 2 (1 hr)

• Sunday – Strength + Zone 2

I’ve done the Triple Bypass ride before, but this time, I realized I was already ahead of where I’d been in past years with Justin pushing me.

What’s that you ask? You want cringeworthy before/after pics of my training-bod so far? Coming right up!

Before first ride…

After one month!

Step 2: Finding My Race Why

During our first team call, First Descents asked us to share our “why.”

At first, I felt unprepared. My default answer was, “I needed a challenge to take my mind off work.” But that felt hollow—especially given the mission behind this race.

Then someone on the call said:

“When you're climbing Columbine, completely exhausted and nowhere near the top, you’re going to need a why—someone to speak to you in that moment, to keep you going.”

And just like that, it hit me.

Tammy.

My son’s godmother. My friend. My mentor. Cancer took her far too soon. Her prognosis of years became mere months. And then came the silence.

More memories rushed in—Strings. Africa. Noel. Rick Hodes.

Then others: my grandmother. George Morris. Friends. Neighbors. Survivors.

“Brent, what’s your why?”

I gave an answer. It wasn’t perfect. But I had it. And now I carry it with me.

Step 3: How You Can Help

Usually, I keep quiet about big goals until after I accomplish them. Why? Because if I talk too much, people start congratulating me too early—which kills my momentum.

But to race with First Descents, I have to raise awareness—and funds.

So here I am, sharing the story, the photos, the training.

And this is where you come in.

🎯 My goal is to raise $3,500. I’ve already raised $2,000, with a stretch goal of $10,000.

If you donate—even $10 (or $200)—it changes everything. It makes me accountable in a whole new way. I cannot, and will not, let you down.

👉 Click here to donate

If a donation doesn’t make sense for you right now, I’d love to hear your story.
How has cancer impacted your life?
Your words can inspire me as much as your dollars.

Thanks for your support. 🙏

More updates coming soon as I continue this journey—along with a few “after” pics I hope will surprise even me.

Let’s Play Bigger and Live Better™.

—Brent

1. What happened to UGURUS?

2. What am I doing next?

3. Am I taking coaching clients?

4. BONUS: Are my chickens laying eggs yet?

If you’re curious about any of those — this is the place to find answers. Subscribe (for free) to follow along.

Subscribe now

✍️ What You’ll Get Here

This Substack is where I’ll be sharing thoughts on entrepreneurship, growing businesses, and digital agencies. Expect content on strategy, AI, scaling, marketing, sales, data, and leadership — all through the lens of someone who lives remotely on a homestead, rides bikes daily, and is mildly obsessed with personal growth.

You’ll find ideas on how to scale smart, live well, and pursue meaningful work — without burning out.

🔍 So… What Happened to UGURUS?

In short, UGURUS was shut down by the company (DigitalOcean) that acquired the company (Cloudways) that acquired my company (UGURUS), because professional services (a.k.a. coaching) didn’t align with the core datacenter, managed hosting, and Ai product business.

While UGURUS was a huge part of our lives, it was a drop in the DigitalOcean. And honestly, I have no regrets. At Cloudways and DO, we were able to 3X the core business in just a couple of years, scale our team, and impact thousands more than we could have on our own. I also had the opportunity to grow immensely — as a leader, operator, and strategist.

I’ll be sharing more personal stories, behind-the-scenes details, and hard-earned lessons in future posts.

🧭 What Am I Doing Next?

First, I’m taking a break. I’ve been building businesses since my junior year of high-school 26 years ago, with little more than the occasional week-long vacation.

Second, I’m either going to start or join a business — most likely in the agency space. I’m in active conversations with one company right now, and if it comes together, it’s going to be awesome.

Third, I’m going to write. You’re reading the beginning of that.

🧠 Am I Taking Coaching Clients?

Not at the moment. After years of high-touch coaching and training at UGURUS, I’m enjoying a little space to reset and write. I’m always open to hearing from agency owners who are doing interesting things or looking to grow — but for now, this newsletter is the best place to keep in touch.

Subscribe and you can reply to any of my posts to keep in touch.

🐔 Bonus: Are My Chickens Laying Eggs Yet?

Yes. And let’s just say they’re overachievers.

Want to Stay in the Loop?

This Substack is my new home base — a way to stay connected with the agency world and share what I’ve learned (and what I’m still learning). I’ll be writing about entrepreneurship, agency life, strategy, mindset, scaling, and personal growth — from the vantage point of dirt roads, fresh air, and 20+ years in the game.

If you're curious about where I'm headed next, want behind-the-scenes insights, or just want to follow along as I explore the next chapter — subscribe for free.

No products, no pressure — just reflections, ideas, and a space to keep the conversation going.

Let’s Play Bigger and Live Better™.

—Brent Weaver

Method #1

You have an important task, goal, or objective to finish. But first!

My coffee is a little low, let’s fill that up. 

My desk needs to be tidy. It’s not, so let’s clear that up. Can’t get work done at a messy desk!

I have a voicemail from the mechanic over at the rental, probably should call him and sort that out. 

I’m waiting on that paperwork from the bank, probably should check the mailbox first so I know if that came in. 

That’s done. 

Better make sure my email is cleared out and back to inbox zero. Wow, I can’t believe I got that done. 

I wonder why I’m not getting the results I want to in an area of my business. I should text my friend about that. Oh look, he’s responding to me, yeah, might as well call him to shoot the breeze. Wow. So good to catch up for a half-hour. 

I haven’t watered my plant in a while. Taken care of. 

Requested commissions from my affiliate deal, done. 

My iPhone and AirPods need a little charging. Plugged in and sorted. 

My coffee is low again. Sheesh! Better top that off. 

What was my priority again today? I better look at my list. Oh dang. That’s going to be a heap of work. It’s practically lunch, better fuel up before I really start to dig in. 

Method #2

Pull up a chair. 

Sit down. 

Look at the priority list.

Start with the number one most important. 

Get to work.

Results

Most people I know practice both methods at varying times in their careers. I’m curious, let me know in the comments below which method works best for you, Method #1 or Method #2?

Take writing for instance.

You write almost daily. No. You write daily. Then one day you don’t. You try to grasp it here and there, but overall, the mojo just isn’t there.

You’ll think, “Nah, now’s not a good time. I’ll wait until I have something really good to say.”

I’m obviously talking about a “friend” here and no one in particular. Ahem.

The problem, of course, is that the muse doesn’t show up unless you show up. You don’t really know what you’re going to write about until you sit down and start pressing those keys.

I’ve had every excuse in the book not to write.

Reinventing my business from the ground up.

Buying out my business partner.

Losing someone close to me.

Living with the insanity of two kids under five.

Yet these are the very life events and circumstances that any decent writer cherishes.

For they’re all about life. Stuff that we get to experience because we’re here and available and still breathing. If you are reading this, you are still alive and breathing and there is inherent magic in that.

Right?

Right.

Sometimes, you just gotta get some words out to break the cycle. Sometimes you gotta hit the gym and walk around a bunch and sorta workout.

Just get familiar with the whole place again. Get over that crud that’s built up in your mind about what that first time back would be like.

It’s not going to be epic. It’s not going to be what you imagined is possible in your mind.

But the can’t do cycle will be replaced with can do. Ahh. That wasn’t so bad afterall.

Right?

Right.

And once you’re back. Well, then the good stuff is possible again. Get a few kinks out. Get the rhythm back. And who knows what will happen.

Whatever it is, it feels good.

What they end up with is a business constrained by themselves with no leverage.

Leverage is:

• A well-documented process that someone else can run ad infinitum

• A seat in your business that can quickly scale with demand

• An automated and productized offering that requires little to no human interaction

• A marketing system that earns a customer for less than your net margin

• A sales system that can bring on new clients without the owner being present

Complexity in your business, usually introduced by you, creates a limiting factor in the growth of your business. Over the long run, simplicity wins. So find a simple point of leverage and make the most of it.

Have you figured out a great way to build websites for fitness gyms that is highly profitable?

Great. Go spend the next year gaining one percent of that market. Spend the next five years earning five percent.

Have a well-documented process for helping your clients write their about page?

Awesome. Turn that into a course and sell it to other agencies and businesses. There are a lot of about pages that need help after all.

Consistently hear about how your strategic planning is the most valuable service you offer?

Excellent. Maybe you should do that for businesses and drop all of the other stuff. That idea is so simple it probably scares the bejesus out of you.

“Fear is good. Like self-doubt, fear is an indicator. Fear tells us what we have to do.”

-Steven Pressfield, The War of Art

Scale is in Leverage

Finding that one thing you do better than anyone else is hard. However, once you see it, you should question – with ruthless aggression – anything else that pops into your head to offer. This discipline requires the utterance of the hardest word:

“No.”

There is a question I ask agency owners when I spot a point of leverage:

“What if you just did that?”

And by “that” I mean whatever it is that pops out as their obvious superpower. I get this response:

“I couldn’t build a business just on that.”

That statement is the most significant limiting belief I hear over and over. Agency owners are so committed to the hard work being a diverse set of skills connected with technical mastery.

Sometimes I think we believe the business we’re in is complication.

The hard work is taking your one thing and figuring out how to package it for a market and then find the market ceiling. What you deliver should be pretty easy. Coca-Cola is still just sugar in water, but the worldwide network of manufacturers, distributors, and branding engine is what all those MBAs wake up daily to further.

Once you find your point of leverage, delivery of your service should be more like clockwork than clock building.

Be Bold, Take Risks

The truth is that you could take any single service that you offer and build a seven or eight figure business around it. I think this truth scares most agency owners to death.

I hear things like, “I’d get bored,” or “I couldn’t do one thing all day.”

Those statements couldn’t be further from the reality of specialization.

Scaling a business is hard. There is complexity you’ll have to tackle as your business grows. You’ll need to get comfortable with new skills in leadership, management, and risk-taking.

The reality is that you not only can do that one thing as your business, but it’s probably the best decision you’ll ever make. That decision will give you the power of leverage.

And once you wield that power, you’ll have a hard time understanding what took you so long.

What’s your point of leverage?

These are just some of the stories that have played out over my entrepreneurial journey. You could classify each as bad moments for me. High stress, low self-esteem, and very debilitating.

However, each life experience has unfolded into a narrative that I’ve been able to share with other entrepreneurs and digital agency owners to help them avoid the same pitfalls I did. Hopefully, others are able to avoid the mistakes I made or overcome them faster.

The only real difference between my problems and most other people’s problems is I choose to write about them. I capture these stories in blog posts, emails, and online courses. The process has helped me see the forest for the trees. I can take a step back and get perspective on what I could do better next time.

Writing takes time. And I think you need time to process this type of stuff. It is too easy to have something bad happen, fall into a negative slump, and fail to capture the value in both the good and the bad. After all, most life events are at best neutral, we’re the ones who apply the meaning to these situations in the first place.

You’d be surprised how much good there is in the bad.

I was recently reviewing an old journal, and on one page it said, “It seems I have been challenged. I only have $3 in my bank account.” I’m sure we can agree that is a rotten situation. However, in the following fifteen or twenty pages, I journaled about what wealth meant to me. That wealth was more than just money. That wealth was about family, relationships, and security.

In hindsight, based on this writing, one could make a good argument that I might never have defined what wealth meant to me had I not written about it when I had none. What I thought – at the moment – was a bad thing, in the long run, might have been one of the best things that ever happened to me because of writing, thinking about, and defining my core values.

I do my best to avoid complaining or assigning blame for my woes. Instead, I focus on what I can learn from these moments. What fundamental truths or lessons I can pull.

When something terrible happens to you, consider picking up your pen next time.

Lost a big deal? Write about it.

Partnership woes? Take some time to journal.

Dump a bunch of money on a Facebook campaign that didn’t perform? Post a status update about what you learned (not about how mad you are).

Writing this stuff doesn’t even have to be public. Fifty percent or more of what I write never sees the light of day. I write to myself. I write letters to my wife. I write drafts that get deleted.

One thing that writing publicly has shown me is how common my issues are and how writing about them gives others a voice. I’ve had at least a dozen entrepreneurs privately approach me about situations they’ve fallen into with the IRS. I’m no tax attorney, but I think it’s important for people to know they aren’t alone.

We’ve all made mistakes. Most are not life-threatening.

So write for yourself. And write for others. The world deserves to hear your story and the process will be of great value to you.

Let me go a step further.

You need to do free work.

Yep, I said it. You should pour your blood, sweat, and tears into a project without direct financial compensation.

“But Brent?! You’re the purveyor of high-value work for high-value pay?!!!”

I know. Head explosion.

Before you freak out on me, here’s what free work has done for me:

• Allowed me to scale up in a new market from zero clients to thirty-five website clients in less than six months

• Helped me break into the restaurant market by working with a champion that added credibility and critical introductions to my business

• Built me an email list of hundreds of nonprofits that wanted our agency’s services

• Paved the way for a 7-figure per year product through in-depth Customer Development

• It’s been the spark that’s helped me generate over $12,000,000 in my businesses

So much for free work being a bad idea. By the end of this article, I’m going to explain how free work can fit into your business’s growth strategy and specific steps to help you get the most out of the tactic.

You’re Moving Too Slow

When I teach digital agency owners how to choose their niche, they often don’t yet have clients in the market they want to target.

One of my coaching clients spent six months attending conferences, cold calling prospects, and doing her best to network within her market to gain traction. I encouraged her to “cut a deal” to get the first client within her market. This offer could be a huge price cut to mitigate risk for her first mover or offering to make phase one of the project entirely free.

Humans are social animals. Group-thinkers. There is incredible power, trust, and authority in getting the first domino to tip. I explained that once the herd saw one of their own trust her agency, others would follow.

She refused. She said something along the lines of, “I’ve paid my dues. I don’t do free work anymore.”

I relented. Back to the drawing board.

A sweet combination of ego and hubris handcuffing her to stagnation. The mindset that I’m better than that. That, somehow, giving away our time is out of integrity with our standards of how we believe the world should work.

Instead of leveraging her skills to break in and prove, and position, she slogged away at building relationships where there was no credibility. Prospects would say things like:

• Can you show me what you’ve done for others like me?

• Do you have any results from companies in this market?

• Have you worked with anyone else?

Her prospects were cold. There was no trust. They viewed her as a wolf in sheep’s clothing. Another carpetbagger is strolling into their territory looking for a buck.

So six months went by, and she started losing hope. She had spent a grip of money on conferences, flights, hotels, to be still empty-handed.

It broke my heart. My client still refused to do free work in exchange for a position in the market.

“If I’m going to be successful in this market, it’s going to be on my terms.”

There was a deeply held belief that free work and the devil were buddies.

All right then. Let’s go back to square one.

Why the heck does the creative industry hate free work?

Positioning Work is Not Spec

Websites like Clients from Hell, Oatmeal, and others talk about clients that:

• Want free work in exchange for a promise future business (that never pans out)

• Want free work now, and if it’s good they’ll pay you later, i.e., spec work

• Want free or discounted work because they’re a charity

• Want free work in exchange for “exposure”

• Want free work because they’re cheap and entitled, or were mistreated as a youth

These cheapskate clients are easy targets for a laugh. Our industry leaders brainwash you to believe free work is terrible. Evil even.

“You will be the laughing stock of the designer community if anyone finds out you worked for free!”

The subtle nuance in most of these cautionary tales and mantras, is these clients are approaching you and requesting free work because they don’t have money, have wrong expectations, and are probably bad clients.

I agree, this type of free work is terrible and will be a dead end road for your agency.

My approach to free work is fundamentally different from the free work the internet has indoctrinated you to avoid.

When I do work for free, it falls into one of these buckets:

1. Market research

2. Customer development

3. Positioning work

In all cases, I’m the one bringing the offer to the table. The clients I offer it to are those I have researched, strategized around, and quantified what I want in return.

Let me show you how one well-placed market champion got me thirty plus clients in six months:

True story.

I wanted to break into a new market that I lacked the necessary experience and had no existing clients within the market. I sought out a market champion, a well-connected influencer in the market. I spent a few weeks building a healthy relationship through informal chats and conversations about the problems that existed in the market.

Once I had a solid understanding of the pains, problems, and aspirations, I proposed a potential solution. I would solve my champions problems, free of charge, and in exchange, she would introduce me to five other businesses in the market that would hire me for a fifty percent reduced fee. Another term my champion agreed to was a warm introduction to another strategic partner or prospect every month for ongoing free labor and support.

The five early adopters in the market agreed to provide me with three warm introductions to other potential prospects within the market that I had yet to meet. There was no contingency that these folks were going to sign up in exchange for the discount. However, by the time I was showing up for my third-level connection calls, I was well versed in the inner-workings of their issues. I could speak to their most significant problems better than they could.

I was batting 75% or higher on winning accounts because my offer was well researched, tested, and proven. Within six months I had thirty-five customers in the market and an email list with another couple hundred prospects. I had open communication with several strategic partners and was being asked to speak at the major industry conference.

I had a market position.

This method works so well. I leveraged free work to break into a market often regarded as a dead-end: restaurants.

Breaking Into a Tough Market

One of the problems with the general free or spec work that agency owners abhor is the clients they are doing it for are in the bottom 10% of their market. Bottom feeders. Low-value mindsets, not connectors, and looking for a free ride.

The clients I do free work for are the top 5% of a market. They are the super-connectors. The influencers. The clients that can get anyone in the market you want to break into to reply to an email, take a meeting, or pick up the phone.

You could spend ten or twenty years building up a reputation in a market, or you can work with someone that already has that level of credibility. You can let that reputation wash over your business through the power of association and make it launch you to the next level within weeks or months.

I like shortcuts.

My late mentor and restaurateur, Noel Cunningham, was so revered in Denver, other restaurants wanted to work with me just because they wanted to buddy up with Noel. I would show up at meetings, and they would say, “We’ve already decided to go with your firm, if Noel trusts you, we trust you.”

And this is the restaurant industry!

The one I hear countless stories from agency owners about how it’s impossible to get them to pay you or trust you or break in. In a matter of a couple of years, we went from a nobody to running the digital marketing for dozens of Denver-based brands.

All because we had one well-placed positioning client and market champion.

I built Noel’s first restaurant website on spec so he would take notice. Then we cut a deal. In exchange for ongoing digital marketing, I would get a trade balance at his restaurant. I was never paid a dollar in hard cash for services rendered. I worked my butt off and, in return, I got free pasta and introductions to restaurant owners.

This idea worked so well. I also built Noel’s charity’s website for free. After we did this for his nonprofit, he introduced me to a dozen nonprofits in Denver that became paid clients. Which then led to a ton of referrals from those clients and inbound traffic from “design by” links on the footers of the top charity organizations in Denver, leading to even more paid work.

The free work for his charity brought me to Ethiopia on four occasions which pushed me to become a leader in the Denver community, earning me even more high paying clients. Not to mention the whole experience changed my life forever.

So much for free work not panning out.

Positioning work is just one type of free labor that can lead to much future business. I also use free work as a tactic for market research and developing new products. Let’s break that down for you.

Developing Products and Services

When we first started thinking about how UGURUS would help web professionals and digital agencies to make more money and achieve freedom in their business and life, we built some video courses teaching my sales process.

After about a year, I reached out to a list of customers and talked to them about how much of the video course they had implemented in their own business. I offered them a free coaching call in exchange for a little time learning about how they used our product.

Instead of chasing down people by cold calling to get feedback, the free coaching offer booked 72 calls on my calendar in a single week. By the end, I was thoroughly sauteed in market insights, and I had a lot of momentum and goodwill with the value I provided.

(Caution: Seventy-two thirty minute calls in a week will fry you.)

I learned that a small percentage of customers had applied the concepts and now had agencies that were taking off. Another portion applied a couple of concepts and were overall happy with the experience. The problem I discovered when researching was the portion of folks that never cracked the book. Or they got stuck on a snag and never applied the concepts of the program to their business.

So I had an idea. What if I added a coaching and consulting element to our product line to push digital agency owners to apply these methods to their business. What if I stood over them and held them accountable, answered their questions in real time, and dug below the surface to help them get unstuck.

Sounds great right?

The problem was, I had never done that before.

So I hand-selected five digital agency owners. I made sure each lined up with one of the customer avatars our team mapped out for the market. Then, I offered them six months of free one on one coaching in exchange for being able to use their stories for research and marketing.

I did it all for…

DRUMROLL.

Free.

Every week I showed up. I took copious notes about their problems. Gave suggestions on how to apply our methods into their agency. I tested methods for coaching and accountability.

The results were incredible. I forever changed businesses and lives for the better.

After months and months of free work, I launched our Bootcamp program teaching web professionals how to land ten thousand dollar projects.

This mentorship-driven program became a seven-figure a year product within 12-months. The program has now morphed into an MBA-style, multi-year program helping digital agencies dominate their market. I estimate that within the next six years, all-in, I’ll have generated over twenty million dollars in revenue from this initial free work.

So much for free being a bad idea.

You might be thinking, “but why not charge for this initial coaching work?”

Let’s tackle that sacred cow next.

There’s Control in Free

I’m sure I could have gone to my initial digital agency owner coaching clients and offered my services for a fee. You can approach customer development by offering to do paid work. Instead of doing free work, use payment as the ultimate form of validation. I agree that cash as a form of validation should happen as soon as possible.

However, structuring my mentorship services as free the first time around gave me incredible latitude. I could run the show to my specifications. If I wanted to stop after a couple of weeks, no problem. If I wanted to change the agenda of the meetings, no fret. If I wanted to change the duration of sessions or the structure or framework I was working within, no issue.

When I was working for Noel’s restaurant, he gave me incredible flexibility in experimenting with marketing tactics to drive people through the door. He even let me create special offers and happy hour promotions that changed pricing at the restaurant.

After we built Noel’s charity website, we started running a ten thousand dollar website giveaway contest every year. Hundreds of nonprofits would apply for this grant. The winners were at our beckoning. We could run the projects exactly how we wanted, and each time we built a free site, we tried radically different approaches to our work to help improve our agency’s processes.

We had our free clients sign “commitment papers” telling them how to be awesome clients. We figured since they weren’t paying us, we needed something to hold their feet to the fire. It worked so well that we rolled it out to our paid clients.

Here’s how I recommend approaching free for your business:

1. Define your strategy

Why are you considering free work? I mentioned three good reasons before: market research, customer development, and market positioning. In the early days of market domination, leveraging your work as an accelerant can pay huge dividends later. Instead of bumbling around a market trying to build credibility, you can use your skills and talents to replace talk with action. You can consider free work as a form of marketing and advertising expense. It can help with:

• Market position

• Connections

• Accelerate adoption in a market

• Credibility

• Authority

• Momentum

• Insights

• Tests

2. Build your list

Doing free work is not a reaction to a client requesting you to do spec or work for “exposure.” You need to identify possible companies in the market you want to dominate and make sure they meet a few criteria. They are:

• Ideal customers in your market

• Well connected with others

• Willing to make introductions

• Open to your leadership

• Excited to help you bring a new level of product or service to their market

I recommend starting with a list because there is a high probability the companies or organizations you reach out to won’t pan out like you initially hope. Sure, free work is compelling, but they might already have a provider and while tempted, won’t be interested in your offer no matter how sweet. Don’t stake your whole strategy on one champion. Stack the deck in your favor by having a dozen or more great options.

Also, let your prospective market champion or test client know you have a list of options for this relationship. That this offer isn’t a sure thing and if they are going to qualify for this massive investment of time and resources, they’ll need to meet specific requirements. Turn the tables of pursuit:

“We pursue that which retreats from us.” – Dex in the Tao of Steve

3. Make contact, build a relationship first

Emailing companies cold offers to do their website, digital marketing, app development, or branding work out of nowhere will probably be regarded as spam. I approach people that I might work for free under the frame of customer development. I’m wanting to get their insight on whether my products or services are going to be a good fit for the market they’re in, and I solicit their feedback. This outbound connection request is what I call a “no sale” meeting or interview. After I’ve built a relationship, and have a good feeling for the type of client and connector they would be for me in the market, I will propose a give/get.

Here is an example of a customer development interview email:

4. Define and offer your give/get

Doing five, ten, or twenty thousand dollars worth of free work is not something I do “for kicks.” I’m clear with my clients about what I expect in return. I’m going to treat them as my best customer, and I demand value in return. If it’s market research, I might expect them to conduct many feedback interviews that might take up a chunk of their time. If it’s breaking into a new market, I’m going to expect introductions to others in the market including potential prospects, influencers, and channel partners. Being upfront by saying, “I expect ten warm introductions to companies like XYZ…”

Make sure you:

• Define what you are giving

• Define what they are giving

• Put it in writing

Here are some examples of give/gets:

• 100% free

• 30-70% discount

• Warm introductions to prospects, channel partners, influencers, associations, etc.

• Sponsorship

• Access to a list (to promote a service, webinar, etc.)

• Feedback interviews

• Experimentation or testing

• Endorsements, testimonials, and references

• Access to stages (keynotes, podcasts, webinars, etc.)

5. Treat your free clients like your best customer

An early mistake I made when doing some free work in exchange for sponsorship, was treating the client different than my usual paid work. We took a “we’ll do this when we have time” approach and it bit us hard. We missed some deadlines and the relationship soured. They ended up paying another firm to take over the project and we lost a bit of momentum and credibility in the market. I learned from my mistake and from that point forward, we treated free work as identical to our other endeavors. Most of the time, I just avoided telling my team how compensation was structured keeping them blind to the setup.

The investment clients pay you normally isn’t the only cost involved for them. Most of the time our clients are paying us to solve costly problems or pursue valuable opportunities. Just because you are giving this work to your client for free, doesn’t mean they need it any less. If you fail to deliver the value they need, they’ll likely move on and pay someone to do the work – and the whole point of you investing in this tactic will get thrown out the window.

6. Follow up on your “get”

Don’t throw your investment of time (and money if you’re paying staff) down the toilet by failing to follow up on their side of the bargain. If you have a written expectation that they will be introducing you to five new contacts per month for a period of several months, get your introductions. Free work arrangements aren’t super common, and it’s easy for clients to make a few openings that lead to paid gigs and call it a day.

If I donate $10,000 in work, I would expect about thirty introductions over six months. I’m buying warm leads for about three hundred dollars a pop. That’s a lot of money to market your business. Treat it as such.

7. Free work is a short-term tactic

I wouldn’t have a business if I offered every restaurant I worked with a trade agreement instead of payment. Sure, I’d have a fantastic dining schedule, and if I had enough paid work from other niches, maybe my business would survive. I recommend free work when breaking into a new niche or retooling your way through an existing market. Or, if you are looking to level up to a new tier within the market, getting a market influencer or celebrity endorsement could help make that happen. However, my recommendation is to shift from free to paid as fast as possible. In aggregate, the free mentorship work I did was a .005% investment of the revenue I earned over the last five years. You should be aiming for a similar ratio over that period.

By following these seven steps, you can make sure when you choose to do work for free, you do it the right way.

Conclusion

Using free as a part of your market adoption, acceleration, and domination strategy can be a powerful tactic. You can cut through months – or years – of credibility struggle. If there is a market influencer and super connector that has built up a reputation and relationships in your market through ten or twenty or more years experience in the market you want to serve, that’s worth a lot.

Why not stand on the shoulders of giants and leverage their experience and network?

Why not grease the wheels of adversity with a godfather offer?

I’ve been able to leverage free work to break into a half dozen different markets and plan to continue using the tactic when appropriate. I’ve found that it can save so much time and build a solid foundation for trust, credibility, and momentum.

If you are struggling to gain traction in your niche, I challenge you to consider this approach. Find a client champion that is willing to trust you to help their company or organization in exchange they’ll introduce and recommend you to the who’s who in the market overnight.

It might just be the tactic that finally turns the tide for you.

If you have questions about first steps, let me know in the comments below. I’m happy to help you structure the right approach for your situation.

When we would advertise way above our weekly budget, and host our sales webinar for digital agencies, we’d get lots of clients. After a few hours of digging deep into the data, I discovered the exact number of dollars it cost us to earn a customer.

More importantly, I discovered that when we didn’t advertise, we didn’t hit our goals for sales. Referral and organic leads dripped in, but sporadically. The numbers were all over the place. In the moment, when ad spend was $0, or under our advertising budget, it felt perfect. I would think, “wow, we’re not making deposits in the Mark Zuckerberg Yacht Fund, and we’re still getting some customers!”

In aggregate, we were losing money because we weren’t hitting our benchmarks. Either real money with a negative net margin, or an opportunity cost because we’d never get that week of sales back. Like hotel rooms, once that week is gone, it’s gone.

So at 2 am, saturated with advertising and funnel data, Henry Ford punched me in the face:

“A man who stops advertising to save money is like a man who stops a clock to save time.”

My mindset changed. Spending money on ads is good. Why? Because it is the FUEL that our Marketing Engine demands. It is the input for the webinar funnel we’d created.

How I Was Losing Money

Let’s say you earn a single customer worth $10,000 without advertising in a given month. The next month, you acquire two $10,000 customers, but you had to spend $5,000 in advertising budget to get there. You might look at that and say “no way!”

But of course, those numbers are missing some context.

Without considering the business’s fixed costs, the direct labor and cost of goods sold per $10,000 project add up to $4,000, giving the company a sixty percent gross margin at a per unit level.

Month 1 Month 2 Revenue $10,000 $20,000 Ad Cost $0 $5,000 COGS/Labor $4,000 $8,000 Gross Margin $6,000 $7,000

It would be easy at this point to consider dropping an advertising program. Spending $5,000 to earn another $1,000 might seem a little reckless. However, there is still a significant number missing in this model, and that is the fixed operating costs to run the business.

Most of the time when I go in and consult with digital agencies, they are underpaying themselves as owners and not considering their fixed monthly costs when pricing their work or setting goals. We’ll add fixed monthly costs to our example with an owner pulling a $60,000 salary and another $1,000 per month in fixed costs to run their virtual agency.

To illustrate this point better, I’m going to add a third month, one where we spend even MORE on advertising, but benefit from a small amount of optimization since we are now learning and testing new ideas.

Month 1 Month 2 Month 3 Revenue $10,000 $20,000 $30,000 Ad Cost $0 $5,000 $8,000 COGS/Labor $4,000 $8,000 $12,000 Gross Margin $6,000 $7,000 $10,000 Fixed Op Ex $6,000 $6,000 $6,000 Net Profit $0 $1,000 $4,000 Net Profit Margin 0% 5% 13%

As you can see, even with the outrageous cost of acquiring one additional customer per month of $5,000, the business is better off and earning a small profit. When the ad costs go up, even higher to acquire two additional customers instead of one, now we have a profitable business within a healthy range.

Facebook in particular likes to charge your credit card and email you a receipt after you spend about $750. In the month 3 example, in the moment you might get a little frenzied. Like “oh my god, I’m spending all of this money on advertising?!!! I’m stressing out!!!” Which is, of course, like watching the stock market on a daily basis. Not the healthiest habit.

(In reality, your sales cycle could be three to six weeks – or even longer – so stomaching this spend in the short run could test your steadiness.)

The numbers that matter are your monthly spend and business performance. Just ignore those emails – or do what I do – celebrate them as a leading indicator that you’ll be getting many customers soon.

Advertising Begets Scale

One of the reasons I have learned to love advertising is that you can trade time for money. If the audience and reach are big enough (i.e., Facebook with it’s 2.2+ billion active monthly users), you can search for the ceiling in your market.

Advertising gets powerful when you combine it with the power of niching. If you have a relatively small service offering that is highly productized and you can wrap delivering around an individual seat or team, then you have the potential to scale quite rapidly.

In my last example, the business can acquire a new $10k customer for $4k in advertising (this number is the Customer Acquisition Cost – or CAC), spend $3k in COGS/Labor, which leaves them with a $3k gross margin per customer. If they’re working with an offshore production agency that (in theory) has unlimited capacity to produce, and the owner has the bandwidth to manage five or six projects simultaneously, they can quickly fill that capacity with aggressive advertising.

At five customers per month, they could find themselves pushing six hundred thousand in annual sales with base pay and over a hundred thousand in profit annually. The pill they would have to swallow would be handing over $20,000 in monthly spend to Mr. Zuckerberg (or Alphabet, pick your poison I guess).

The math gets even more favorable if one considers Lifetime Customer Value (LTV). Perhaps we can agree to talk about that in a future article.

In The End

Looking at our gross margin at a per unit level distorted my vision. In the short run, I was happy with really low customer acquisition costs but in the long term, my business and I would have been much better off with drastically higher customer acquisition costs but with more customers.

The context that you need to understand is your fixed operating costs and how that number plays into sales volume and gross margins.

I quadrupled my ad spend, which doubled my customer acquisition cost but made me a lot more net profit. Then I doubled that ad spend and it continued to benefit. At one point I was paying over $50,000 a month on advertising – which started to show some diminishing returns. We found the ceiling which was what we were wanted after all.

Then we optimized and all that jazz.

So thank you, Henry Ford, for punching me in the face. I could use more wisdom like that in my life to help me see the forest for the trees.

Are you trying to save on advertising when you should be leaning into it? Perhaps Mr. Ford can help you too.

I love Lucky Charms.

Not just a little bit. A lot a bit.

The marshmallows are delicious. The sugary cat-crunchy-looking pieces are delicious. The rainbow milk is delicious.

I am fully aware that sugar is the greatest evil to our bodies that ever existed.

I don’t care. Lucky Charms creator John Holahan deserves the Nobel Prize for Chemistry. And Peace. Come to think of it. He deserves all of them.

Did you know that the marshmallow shaped like an hourglass is meant to give you the power to control time?

Epic.

I love Lucky Charms so much, the only way to keep myself from devouring them twenty-four hours a day, seven days a week, is to avoid keeping them at my house.

Just like I had to learn not to keep developers on my full-time staff.

Custom Development Woes

Like eating Lucky Charms, I love to develop custom software.

When I was running my digital agency, it was our Achilles heel. A client would need a website and digital marketing (projects that were straightforward with plenty of processes and controls), but then they would mention some other problem in their business or organization.

A problem that could only be solved by writing reams and reams of code into a custom software application. The application would need servers. It would have bugs. The project would be rife with risks and time warps, but like a deranged wolverine hunting for star-shaped sugar bombs, I would relent and accept the job.

We could build a typical small business or nonprofit website within about 10% margin of error on our estimate. Some projects would finish taking a little less time than we thought, others a little more.

Then there was custom development.

We once quoted a project at two hundred hours that turned into a thousand plus hour monstrosity.

You might say to me that perhaps we had no business doing custom app development. Or perhaps our business model wasn’t set up in the right way. All good arguments.

Just like if I go out and have a two thousand calorie dinner at an excellent restaurant and am completely stuffed. Then come home to my in-laws’ house (they keep Lucky Charms at their house for my exclusive pleasure), and I still scarf down a bowl or two.

There’s no logical explanation.

Thousands of business owners let me in behind the curtain to what’s going on in their business. If you think you are immune to this problem, trust me, every entrepreneur has their version of Lucky Charms.

An Idle Developer

When we first started UGURUS, we had a full-time designer and two full-time app developers on our team. I was so used to having Lucky Charms around, I mean developers, at my agency, I couldn’t imagine a new business without them. They were so talented, and I kept them busy around the clock.

When we first started our training, coaching, and education company for digital agencies, we also built our own:

• Content Management System

• E-Commerce Engine

• Live Streaming and Webinar Platform

• Automation Engine

• Learning Management System

And who knows what else. At one point we had almost a dozen Amazon Web Services (AWS) servers running countless tools and redundancies.

The subscriptions and service fees that we shelled out just for our development environment was equal to another full-time person’s salary.

We got so good at keeping this team busy. We set up an agile development environment with PBI boards, sprint meetings, and internal workshops on how to run scrum. Whenever this team would get even close to being idle, I would drop my priorities and work on the next sprint.

The problem was, building or selling software wasn’t our business model.

One day, on a plane ride home from a conference, something occurred to me. I was reviewing our profit and loss statement and looking at where we generated our revenue. Just like at my agency, ninety percent or more of our income was from stuff that had nothing to do with custom development.

Our customers bought:

• Courses

• Mentorship

• Community

We were spending fifty percent of our resources on custom application development. It was a steady and extreme dose of sugar killing our body. The majority of the benefit was short-term satisfaction. Instead of having to compromise with off the shelf software, and trust others, we got to build our custom fitting solutions.

I was talking to a friend about something entirely unrelated, and she said:

“If I want to avoid cookies, I don’t keep them in the house.”

My mind exploded.

The Habit Loop

If Lucky Charms were in my cupboard, they would get eaten. Maybe it happens in twenty-four hours. Maybe in two days. Regardless, they are gone within a short period. All disciplined self-control would do is delay the consumption to perhaps a couple of weeks.

Following my friend’s advice, I stopped buying them.

It was like magic. I stopped eating Lucky Charms (except at my in-laws).

It turns out, the Power of Habit says our lives are driven much more by habit and routine than by choice and free will. We make very few decisions throughout the day. Our brains conserve power by allowing routines run without much interference.

The Habit Loop says that we get a cue, some trigger, and follow that with a routine that leads to a reward.

(Image from The Power of Habit.)

My cue was opening the cupboard and seeing Sir Charms. From there it was “They’re Magically Delicious!” all the way to the bottom of the box. Instead of buying LC’s, I bought nuts, cheese, and apples. The next time I went to the cupboard, while my choices weren’t nearly as delicious, the habit loop played out differently.

I’m sure I have my share of unhealthy snacks from time to time. I’m not impervious to this. However, there is no other food that I compulsively devour like Lucky Charms. So for me, a huge step forward in eating healthy, as my friend advised, is not keeping them in the house.

The Many Applications

I realized how useful modifying cues could be in reprogramming habits. Not only could this influence my snack and cereal consumption, but any area of my life that I wasn’t getting what I wanted.

When I thought of how I spent my free time a few years ago, I noticed I watched a good amount of TV (one to two hours per day, with the occasional binge of much more). I’d get into a good show (Breaking Bad, True Blood, Entourage, etc.) and dozens of hours would evaporate. Just getting current on Game of Thrones absorbs sixty-seven hours of your life.

I’m not dogging on watching TV. It’s just not what I wanted to do with my life. When I sat down and journaled about how I wanted to spend my free time, I always came back to a single word: books. When I read for an hour, I always felt like I did something significant to nourish my soul. Never the case with TV.

I couldn’t help it. I walked into my living room, and I’d think, eh, why not – I’ll turn it on and see what’s available. Timewarp.

So five years ago I got rid of the TV. Not just “cutting the cable,” but removing all of the devices from my house. We still watch the occasional show from a laptop or phone, but the viewing experience is subpar, and the cue isn’t in the living room anymore. I went from one to two hours per day to about thirty minutes to an hour per week. I now have a stack of books in just about every room I hang out in to give me the cue of reading.

A year ago I wasn’t getting the exercise I wanted, so I bought a bike. I would occasionally commute to work, and I loved it. But too often I would walk out to my garage and choose to drive instead. So I got rid of the cue and sold my car. A year later I’ve biked over 2,500 miles and am in the best shape of my life.

We still have a family car. I drive when necessary, but the obstacle I’ve created for myself nudges me to my bike for most daily travel. Including a nine-mile round trip taking my son to preschool in a bike trailer.

Earlier this year I bought a Nintendo Switch and found myself playing it every chance I got. Every time I saw it I wanted to play Breath of the Wild (fantastic game!). But just like TV and my car, it wasn’t what I wanted. When I sat down and journaled about what was important in my life, I came back to three words: riding, reading, and writing.

I was doing pretty good on the first two, but I wasn’t writing. So I got rid of the Switch. Instead of having it accessible around the house, I carry around a Moleskin to make writing more accessible.

This trick to remove sources of harmful habits is one of the most powerful lessons I’ve learned in my life. My wife recently chastised me for being on my phone at the dinner table before eating. I’d sit down while she was finishing up prepping dinner and I’d be fried from a day of working and curing the boredom, I would flip open some news or social media: Lucky Charms for my brain instead of a nutritious snack.

I bought some Table Topics, The Daily Stoic, and do my best to remember to put my book de jour on the table. Instead of going for my phone, I choose what’s right in front of me. My next step is to get the Light Phone 2 when it comes out and dock my smartphone as much as possible.

The Final Step

At UGURUS, we had to stop buying Lucky Charms at the store. We realized that our core business was not custom software, so spending fifty percent of our resources on custom software was not sustainable. We had developers in our house, and it was too easy to eat them every chance we got.

Don’t like the way WordPress does XYZ, spend two months making your own.

Don’t like the quality of Google Hangouts, spend a month making your own.

Don’t like the Infusionsoft UI, spend three months making your own.

We made some hard decisions and reorganized our team around our core product offering. Instead of spending so much time on our platform, we found off the shelf software to fulfill the technology needs in our business. Removing our design and development staff was a painful transition and wasn’t free of its costs and hurdles. We still hire developers – outside contractors and consultants – but we evaluate those costs and investments as they should since it’s not core to our business model.

However, our accountability chart is a much stronger reflection of our business model. This alignment is what is important. Freeing up these resources helped us scale up our business and pushed us to spend a lot more time with our customers, mentor team, and think about how we were meeting the needs of our market.

The other day I was coaching a digital agency that found themselves in the exact same problem. They had two custom app developers and felt obligated to keep them busy with new complex projects. Their core business model was websites and marketing, but they couldn’t resist throwing complexity grenades into their lives with large-scale app projects.

This agency’s accountability chart was a mess. They lacked a clear and coherent business model, and the people they had in their business weren’t rowing in the same direction. They were spending fifty percent or more of their time internally dealing with issues and problems from only twenty percent of their revenue.

I started telling them about my problem with Lucky Charms. They probably think I’m a little crazy for comparing their complicated people issues with a box of cereal.

And they are right – as long as their developers are in the house, the issue is complicated. If the developers are there, they have to pay their salaries which means they need to keep them busy with billable work. However, every time they take on that billable work, it causes headaches for other people, and that reduces their ability to produce the real billable work that their agency is all about.

The solution, of course, is much more straightforward. Just don’t keep the Lucky Charms in the house in the first place.

What is your Lucky Charms? Are you keeping them in the house? How is it serving you?

At UGURUS, we practice the Entrepreneurial Operating System® (or EOS for short). This system has helped my team and myself operate our business with discipline. One of the habits our EOS® Implementer has helped me adapt and internalize is writing and delivering a quarterly Core Values Speech.

Prior to EOS®, we had core values defined, and they sat in a document collecting dust just like the periodic business plans we would cram together and do nothing with. All these entrepreneurs, consultants, and books kept telling me the same thing, “DEFINE YOUR CORE VALUES!!!”

And then what?

We finally got a roadmap for doing all of the great things core values can do for your business with Gino’s system. We could use them when:

• hiring

• rewarding

• firing

• communicating

• aligning

• deciding

• motivating

And so on.

After we defined and updated our core values about four years ago, our EOS® Implementer, Bobi Siembieda, asked me to deliver a speech to my team that highlighted and explained our core values during the all-hands quarterly offsite with our team. Not only that, but she said that I would be doing this each and every quarter to rally the team. I didn’t even know where to start, so she pointed me to the section in Traction that explained this activity:

“The next step in the process is to communicate these core values to the rest of the organization. It’s time to create your presentation speech. People won’t necessarily understand what you mean if you merely state each core value. That’s why each one needs to be backed up with stories, analogies, and creative illustrations to drive home its importance.”

Wickman, G. (2011). Traction. Dallas, TX: BenBella.

So in May of 2014, I delivered my first speech to my team. We did our first quarterly team offsite presentation of our business plan and at the finale, I stood up and read the words to our team. I was a bit nervous and felt awkward, but it debuted a specific language around what we valued as a company with specific examples and explanations.

Prior to this, we had core values defined, but they were just a few words listed on a document and shared. Never explained.

Every 90-days following this unveiling, we have built repetition with our core values with a new speech each quarter. I’ve since delivered a version of this speech 16 times.

Core Values Speech Example

If you’ve been instructed to implement a core values speech in your team or see that it could be valuable to instill your company’s core values into your team, I want to help you.

First, here is my most recent core values speech in a written and audio form:

UGURUS Core Values Speech – 2018 Q2 (Audio – read by me)

UGURUS Core Values Speech – 2018 Q2 (PDF – memo)

This speech is delivered at our team all-hands rollout of our quarterly plan. Steve and I meet offsite for a full day of strategic thinking around our business with Bobi. Following this meeting, we have a day to distill our plan, update docs, and then that evening is usually when I sit down and write the updated values speech. The following day is when we do our team all-hands. For the past few years, this all-hands meeting is a lengthy 3 to 4-hour team breakfast at the Four Seasons in Denver.

We spend the first hour or so hanging out, eating breakfast, and chatting. After eating, we dig into our docs. We start with a retrospective on the last quarter on how we did. We share an updated 12-week rolling scorecard, numbers for the quarter, and how we did on big priorities – or Rocks. From there we dig into our plan moving forward. We review our VTO

, Accountability Chart, and Rocks.

Once we’ve unveiled our plan, we solicit feedback and insight from each member of our team. We aren’t debating the plan, just making sure everyone has an opportunity to be heard and ensure they understand what leadership wants to see out of the business over the next quarter.

At the very end, I stand up in front of everyone and read the speech.

Why The Core Values Speech is Important

I’ve learned that the core values speech is a keystone medium to deliver and reinforce your business’s core values. It’s not the only medium – you should also figure out how to reward and reinforce values during the day to day operations – but it provides a platform to unpack your values. Here are three benefits I’ve found:

1. Defines Core Values
   It’s one thing to say we value Being Bold and Taking Risks, but it’s another to explain what that means. Does it simply mean that the business takes risks with new ventures, or does it mean that an employee holds that value when they are communicating feedback to leadership within the business? Your core values speech should unpack each and every core value, provide examples, analogies, and stories to bring them to life. Just like words have definitions and multiple meanings, so do your core values.

2. Reiterates Core Values
   It can take seven times to hear something before you hear it the first time. Repetition is the secret to mastering your business. Repeating your core values consistently helps to make sure they are actually used. And each time you emphasize your core values through your values speech, you’ll be at a different place in your business. They’ll mean different things at different times. So repetition not only helps their adoption and use in your business, but also deepens your own understanding of your core values.

3. Reflection and Introspection
   Sitting down to write my speech each quarter gives me an opportunity to think about what has happened in my business and life and apply meaning. Doing this in the context of my company’s core values helps me to gain insights. Connecting what has happened and what we plan to do to our core values is an enlightening exercise for myself. And then sharing these insights with the team is one more opportunity to build a shared vision for the business.

How to Craft Your Core Values Speech

There really is no right or wrong way to write your speech. There is an example in the book Traction which is where I started. That being said, I think the only real requirement is to include all of your core values and elaborate on them. From there, it’s really a blank canvas for your creativity.

1. Start with your core values.
   I first wrote a paragraph or two about each of our core values. This serves as the base of my speech and has varied just a bit since we started doing a speech each quarter. The biggest change in this part of my speech has been when we’ve changed our values during our leadership planning time.

2. Add an example or story from the last 90-days for each value.
   I give one or two short examples from team members each quarter for each value. This gives me an opportunity to publicly recognize someone in our team living the values. These stories are not actually in the published memo from above. Most of the time, I just write in some hand notes on this section or will type shorthand for who I want to recognize on my speech doc. I’ll write something like “Dianna > Johnny T > $16k win after strat call” under my Help First value. These notes would tell me that Dianna helped a customer named Johnny T sell a $16,000 project following her strategy call – which is a free intro call we do for our programs. That is a headline-worthy event as it shows that she wasn’t just selling, but helping the customer prior to an enrollment.

3. Add an introduction story.
   This is where I get a bit creative. I’ll start with a theme, event, ah ha, or idea and tell a story to start off my speech. Usually, it’s a page or two written. One of my favorite things to do in these stories is bringing in customer testimonials, videos, and emails to make them come to life. Let’s say we just launched a new program – I might include an email from a customer letting us know how much this program changed their life.

4. Tie in your purpose and/or BHAG.
   Besides your core values, the values speech is a great way to talk about your business mission. Let your team know that the values and stories are relevant for your journey to accomplish your BHAG (big hairy audacious goal) and living the purpose of your business.

5. Practice reading it aloud.
   At first, I thought I would need to practice and memorize this speech. This stressed me out like crazy. There is a lot of work happening in the calendar quarter for me in my business – and adding one more thing was not something I was excited about. My focus is on writing a good speech. Then print it out and have it handy when it comes time to wrap our quarterly. If possible, give it a couple good practice reads to catch any language that sounds funky in spoken word as well as grammar. I usually find that I make a few changes after I speak it out loud.

Once you have your speech written, you’re 95% of the way there. That last five percent is actually reading it to your team, which is where you might have butterflies. But it’s where all the reward is!

You’ll likely feel a bit awkward. That’s ok. Your team is looking to you to be a leader, and giving this talk every quarter is a way to inspire them to follow you on your mission.

Not Sure if a Core Values Speech is Right For You?

The last thing I want to talk about is some what if’s that might have you considering whether doing this activity is right for your business.

What if I have a small team?

Our UGURUS team is small. We’ve varied in size from four to about ten core team members over the last four years. I think I would deliver this speech as long as there was at least one other individual in my company. I feel a little strange when standing up at the end of a conference table with just a couple of people listening to my speech, but it’s great practice and the value is still there. As long as there are other people in your business that you need to rally around a common set of values, I think it makes sense.

What if I don’t have a team?

I have not personally been in this situation for over twelve years, but I do coach and mentor many without teams. If you don’t have a team, my recommendation would be to still do this exercise, but more as an introspective to solidify what you value and to tell a story about where you’ve been and plan to head. You could consider publishing it to your customers as a way to talk about what you value every quarter.

What if my team is virtual?

You need to do this more than those working locally in an office. Being remote means that people have less contact with one another, so being explicit in your core values and driving repetition around them is paramount. When folks are around each other day in day out, they tend to rub off on each other. When teams are remote and have less contact, it’s so important to make sure everyone is rowing in the same direction and sharing the same values when interacting with customers. Spin up a Zoom room. Record audio or video. Do whatever you can to get each team member to read, listen, or watch your delivery every quarter.

Should I share my speech externally?

That is up to you. After four years, we just decided that we would share our core values speech moving forward publicly as a memo. This gives us an opportunity to talk about what we value as a business with our customers and potential customers. The above memos are not the raw speech I gave my team. They are close to it – but I did spend about an hour making modifications so that it would be relevant to the general public. I think as long as you are talking about things that you think are important and key drivers for your business, I don’t see any reason not to.

Core Values Are Not Commandments

My final word on core values is on their fluidity. For the most part, over the past four years, our core values have remained constant. But they have changed. I was just looking back at my very first speech and most of the phrases that we used to communicate our core values were different than they are today. However, the underlying “value” is pretty close.

If you are hesitant to do this exercise because you’re not 100% confident in the core values you’ve set for your business, I encourage you to give it a try. You’ll likely find that this exercise will help you get more clear. By thinking of stories, bringing examples, finding analogies of things you value in your business, you’ll start to gain clarity on what you value. What other’s on your team value.

And that’s the whole point.

Create a common language around how you want folks to behave, who you want on your team, who you want as a customer, and who you don’t want around.

Core values can be a powerful tool to grow and scale your business. They are also a way for you to do more of what you love doing which is really what it’s all about.

If you have any questions about writing your own core values speech, let me know in the comments below.

Until next time.

Just about a year ago, I sold my car, became a one car family, and switched to a 10-speed as my primary means of transportation. I did this to deliberately challenge myself, create more happiness in my life, and add one building block to ultimately achieve financial independence. I have been pleasantly surprised by how effective changing this one habit has positively impacted my life.

In the last year, I’ve pedaled over 2,000 miles. I started this experiment at the tail end of Colorado’s winter season and am now again in the midst of snow and below freezing temperatures. As I mentioned, part of biking as a primary means of transportation is about taking on the challenge. What I’ve learned so far is that it’s not just the fitness challenge that has been beneficial – but a multi-pronged challenge that involves planning, experimentation, and overcoming all sorts of physical and mental discomfort.

A couple of weeks ago I did a 40-mile, three and a half hour, ride at the crack of dawn when the temperatures were scarcely breaking 14°F and the Weather Channel said it “felt like -7°F” with the wind chill. A tad bit nippy to say the least. On top of that, it was snowing off and on and there was ample moisture on the roads that made it’s way to my feet and legs.

Comments from friends and family sound something like this:

• “That doesn’t sound safe…”

• “Biking is not a winter activity.”

• “There might be something wrong with you…”

• “Biking in the snow/rain/cold sounds miserable/crazy/stupid.”

All are legitimate pieces of feedback and reasonable things to say.

However, as any biker will attest, you learn something about yourself, your approach to biking, and the universe on each and every ride (something I could never say about driving). A year in, I thought I would take a moment to share with you some of my strategies, tactics, and winter bike gear to keep your gears turning during the cold months.

How to Bike in the Winter

During my first winter, I made some easily avoidable mistakes during my commutes.

Thankfully my initial commute from our Park Hill house to my old office was only about two miles (I have since moved South of Denver where my shortest commute is about 5 miles). When your regular commute is only 2.4 miles, gaps in your winter protection and gear can be very forgiving. But I don’t just commute to my office. I also commute to appointments and to run errands regularly and these can be anywhere from 5 to 20+ miles each way.

One time I got out of a meeting after dark during a snowstorm. I was in an industrial part of town about 10 miles from home. Part of the route had me go on a dirt road that had turned muddy-puddle-mess. The gloves I was wearing were rated to 35°F and it was well below 20°F. My primary navigation system was my phone which I had to keep in a pocket beneath my hard shell jacket – which required me to frequently stop, de-glove, and reorient myself. With each stop, my ride time extended and my hands got colder.

In these moments, it’s hard not to think, “this might be a mistake” in your head. So I thought I would frame this guide into the context of mistakes I’ve made. Because if you do choose to bike in the winter, I want to help make sure you have as few of these moments as possible.

#1 Winter Bike Mistake: Being Vulnerable to Moisture

The first time I rode during a light snow, it happened to be a very dry climate. The snow was not sticking to the roads and the roads stayed relatively dry. The snow was also light enough that the heat from my body made any moisture evaporate on my clothing before accumulating and becoming a problem.

This gave me the false comfort that I didn’t need any special clothing when it snowed. So when it snowed a little heavier and wetter about a week after this first ride, my work slacks became soaking wet, my socks and shoes froze, my feet quickly numbed, and my drenched legs started to get frostnip.

Not good.

I decided if I was going to keep doing this, I needed to approach winter biking much in the same way I approach snowboarding.

Looking at what gear I had lying around the house, my snowboard pants and jacket became my initial go-to for future snowy ventures. They easily fit over my work clothes, kept moisture out, and were very warm (often too much so). The downside was how baggy they were. A couple of times the loose pant fabric got caught in my bike sprocket. This can be avoided with a simple ankle strap.

Also, my North Face jacket was not built for biking – so the forward position you maintain while in the saddle exposed my rear waistline periodically and bunched up in the front. Both are things that don’t add up to a big deal on short rides. Longer rides (1+ hour), those small exposures can take a toll.

On one couple hour ride in the cold, I felt occasional frostnip across the exposed tailbone area where my jacket did not cover. The sleaves also pulled back and exposed skin when I was in my forward biking position, exposing my wrists. Again, not a big deal on short rides, but longer rides it became a hazard.

When temperatures began to warm up, and summer rains began, I realized that my waterproof snowboard pants and jacket built for cold weather were less than ideal for simply keeping the rain at bay. I purchased two bike-specific pieces of outerwear, Shower Pass pants, and a Sugoi Zap Bike Jacket, for moisture barriers.

These barriers have been almost-perfect throughout my second winter season. Both protect against moisture and wind and are fit for biking. The pants have built-in velcro straps to secure the loose fabric. They are also built as a “shell” to quickly and easily pull over other clothing. The jacket is longer in the back, shorter in the front, and has long sleeves to maintain 100% barrier coverage in a forward riding position.

Because each is a complete barrier, it inherently traps heat inside – which on cold days works just fine, but can become extremely hot very quickly on days above 45°F.

My biggest complaint against both is that they lack pockets. Pulling up the jacket to reach interior pockets, or working my hands beneath the shell pants to grab keys or phone is a small nuisance, but does create exposure which matters on sub-zero days.

#2 Winter Bike Mistake: Wearing Cotton

My usual work-wear is dress slacks and cotton t-shirts. Short winter rides with a moisture barrier, no big deal. Longer rides – even with moisture barriers – creates an inverse problem: no moisture getting in, but my body’s moisture piled up on my inner layers. Regardless of where the moisture comes from, when it builds up against your skin in cold weather, you can be in danger.

I read a lot of other winter bike commute guides and determined that cotton was no bueno if I was to continue long winter rides. Over the summer I had picked up lycra bib shorts and shirt.

Note: I should probably bring up at this point the whole lycra and spandex thing. When I first started bike commuting I was 100% committed to never wearing that stuff. As my rides got longer and I dealt with more varying environments, I started to change my tune. Work slacks started ripping at the crotch from too much bike activity (this happened to about a half dozen pairs of pants). Shirts and jackets flapped in the wind or got grease stains on them. The variable wardrobe also made it hard to learn what worked and what I needed at specific temperatures. So I got over the lycra thing. You can definitely make bike commuting work without wearing bike-specific clothing. Especially if you are consistently riding less than one hour. I either just wear my bike gear on my errands or appointments or bring a change of clothes to slip into. It doesn’t take long to change. But now I view bike clothing as the uniform of road cycle culture and have embraced it. This last Friday I rode 85 miles in the cold over 7 hours. Lycra makes that possible.

Both additions to my kit had worked great for long summer workouts to pull sweat away from my body and keep me cool. I imagined the same would hold true in the winter and the same outfit would pull sweat away and retain heat underneath my outer shell.

Indeed. However, on a fall ride, I realized very quickly the limits of just shorts and short sleeve shirt hit about 60°F. Below that with a little wind and biking became quite uncomfortable.

As the temperatures started dropping, I added four items to my repertoire:

• Lycra arm warmers: These are great to keep in my just-in-case bag or start a ride with and remove later as I get warm.

• Soft shell jacket: Great for when temperatures are in the 40°F to 50°F’s and there is no moisture or heavy winds.

• Lycra long pants: Perfect for putting over the bib shorts to cover my legs and pull moisture away from my skin.

• Full finger gloves: I don’t normally bike with any gloves, but I got a pair that was rated for 35-40°F.

#3 Winter Bike Mistake: Cold Extremities

Head, ears, and nose are an absolute must. One of my old snowboard helmets had ear covers and very little dome ventilation. I kept the goggles on the helmet and realized how amazing of a solution it was for biking. No frozen air swooshing across my eyeballs and great at keeping my head warm. As temperatures dropped below 20°F, I needed more. I picked up a full head mask from REI and I could now withstand 0°F days without much ado in the head, ears, and nose department.

The head mask easily pulls up over my nose to block the wind and the full neck, ear, and head coverage keeps everything cozy. You can easily lose 40% or more of your body heat through your head, so this is an important place to protect.

Once temps dropped below freezing, my hands quickly became a weak point. My gloves were rated to 35°F and this became so apparent so quickly. On a few rides, I lost feeling in my fingers which isn’t a great thing considering how important they are for braking and shifting gears.

I decided to try my snowboard mittens and they were a slam dunk. Not only that, but I just put them on over my gloves and they fit perfect. That way I can remove my hands from my mittens when I need to mess with my phone, grab a snack, or whatever and my bare hands aren’t getting exposed. I imagine next season I might invest in some specific below freezing gloves that are meant for biking.

Shifting gears and braking in mittens can be a bit restrictive.

My feet have proved to be my last major weak point in my winter armor. I use clip pedals and have a casual Shimano shoe that allows me to wear them like normal shoes. They aren’t a solid barrier – both air and water easily pass through the material. I purchased some inexpensive neoprene foot covers that work pretty well down freezing temperatures. Below that – even with wool socks – it seems that my feet go numb in about 30 to 40 minutes.

On my recent 40-miler in below freezing temps with moisture, I found myself needing to stop and grab some foot warmers. I wore two pairs of wool socks with a heating pad on top and bottom of my foot. Altogether, this combination seemed to do the trick. However, by the end of the ride, the warmers were failing to keep up and my feet were again turning numb.

My current plan is to ride out the remaining 2017-2018 winter season with my current foot situation. Next year I’ll be looking at specific winter biking shoes so I can continue riding with cleats. I have a 200km ride coming up on March 24th. Considering the length of this ride, depending on the weather forecast, I may or may not move this purchase up sooner.

#4 Winter Bike Mistake: Failure to Plan Ahead

If you fail to check the weather when driving to a meeting – not a whole lot of negative creeps into your world. Perhaps there is a little more traffic or you “suffer” a bit of cold discomfort as your heated seats begin to circulate. When biking 20 miles across town, failing to check the weather report can leave you in a world of pain. Without the proper gear, you might find yourself calling an Uber, spouse, or catching public transportation.

I’ve learned this the hard way on more than one occasion. So I try to do two things now:

1. Always check the weather.

2. Bring lots of layers and options.

For a while, I wore a backpack that had all my bike kit packed and ready to go. I had my outer shells, arm warmers, foot covers, gloves, bike lock, and so on – all right there. As this got heavier, along with my laptop, I found that I started getting back pain during and after long rides.

To help alleviate this, I picked up a seat-post mount and bag that easily slides on and off. This now contains all my kit along with spare bike tires, pump, and additional lights when necessary.

Having all of my winter gear with me has helped me calibrate. I can confidently leave and think, “I’m a little cold, let’s see if I heat up,” and if I don’t, then I’ll add a layer on. Having options also helps out a ton as weather changes or my ride intensity does. I recently moved to Castle Rock, CO and the hills here are plentiful. It’s also about 1,000 ft higher than Denver.

Sometimes I’m running super hot going up a long steep hill, only to freeze up just minutes later zooming down. And the weather can change pretty rapidly. Recently it’s been the 30+ mile an hour winds that seem to come out of no where and can make it feel 10 to 20 degrees colder than the thermometer is reading.

#5 Winter Bike Mistake: Not Knowing Your Routes

The other day I was riding out to an appointment about 20 miles away over a new route. I had looked it up on Google Maps a few times, felt comfortable, but did not anticipate the swift weather change. By the time I was halfway, it had begun snowing really hard and the temperature dropped almost 20°F over the course of about 45 minutes. I was forced to take out my phone a half dozen times to navigate my way. Each time I had to slow down or stop, remove my gloves, fidget with my outer shell, and toil in frustration.

The best way to stay warm while biking is to keep moving. Your body is your best heater. Stopping and starting affects your heart rate and heat production.

Not only that, but one of the stretches of road was a heavy traffic street and it would have been a reach for my comfort level on a sunny day. Altogether I was relieved and thankful when the ride was over. Later on, I took a second look at Google Maps and decided that there was another route that would take about 10 to 15 minutes longer, but had only a couple of turns and would keep me on a bike path for the majority of the commute. A mental note is taken that I’ll need additional buffer time for the next go at this commute.

You’ll notice that so far I have mentioned nothing about special tires or bike. I use the same exact bike and tires that I use during the Spring, Summer, and Fall with no problem in the Colorado winter. That being said, I tend to stick to plowed streets and sidewalks when possible. My road-bike tires have done just fine in snow so far. I have had a few “oh dear” moments, but no wipeouts yet. This gets back to knowing your routes. I know where I’m comfortable in the snow and where they clear the streets and sidewalks quickly.

As I continue to ride more in the winter, I can see myself getting a second bike that is more snow/winter-focused with metal studded tires, but at this point, not having one has not really impeded my ability to ride in the winter.

Final Thoughts

Biking is and should be a year-round activity. The same friends that look at me strangely and think I need my head checked for going out and pedaling on a 20°F day are the same people that take off Fridays to head to Vail when there is a blizzard outside and -4°F windchill. In my mind, there really is very little difference.

But I have to also recognize the reality: most people see a massive difference.

On my 40-miler the other day, I only saw a single person on a bike over a 3+ hour span while riding from Denver to Castle Rock – the majority of my ride on a bike path. I’m sure the same day at Vail and I probably couldn’t have walked 2 feet without running into another person engaged in snow sports.

So there aren’t a lot of us out there.

If you are new to winter biking, take it slow, be prepared, and remember my #1 rule:

Getting home safe is priority #1. 

I’ve taken some ego hits when I felt a ride was entering unsafe territory by calling an Uber or my wife to pick me up. I’ve canceled rides and taken Ubers, to begin with, if my gut says it’s no good. I’ve stopped and warmed up in a 7 Eleven when I was concerned my feet were getting frostbite. All were situations that allowed me to reflect and learn to improve my approach to winter cycling for my next ride.

Don’t get me wrong, I’m counting down the days to when I get to ditch the extra kit and return to warm, sunny days in the saddle. But I’m not going to wait around until then to enjoy my bike. And I’m certainly not going to let winter be the reason I go out and buy a car.

Back in 2014, I binge listened to about a half dozen audio books while repainting several rooms in our house. One of the books I read was Ryan Holiday‘s The Obstacle is the Way.

The book brings to light the many influential and successful people that have made use of Stoicism – an ancient Greek philosophy of enduring pain or adversity with perseverance and resilience – as a way to do great things and become successful. A great mindset to adopt while enduring the endless arm cramps and discomfort of painting the entirety of your house’s interior.

I’ve been thinking a lot about what I learned reading this book recently. My internal mantra of “doing hard things” as a way to find happiness and become more fulfilled draws a lot from what the stoics learned about life. This dedication to doing more and more hard things over this year has definitely led me to more life satisfaction.

So it brought a lot of happiness to me this past week when I got an opportunity to hear Ryan speak at one of our EO Colorado’s regular learning events and then go to dinner with him afterward. His talk was primarily about his newer book, Perennial Seller, but many of the questions, concepts, and dinner discussion overlapped his other works.

I took a few pages of notes, some highlights for you…

Irrational Bias to the New & Shiny (but often unprofitable)

In business, the majority of profits are derived from products and services that are not new. It’s the “perennial sellers” – the ones that need very little ongoing investment of sales and marketing that drive the majority of margin. Yet our culture is obsessed with the new releases and headlines-worthy things.

I think as entrepreneurs this is an important lesson. Perhaps spend more of our time on existing products, services, and customers and less time worrying about “the next big thing” and business and life might get easier with better results. This lines up well with the popular saying: “it’s 10 times harder to sell a new customer than an existing.”

Focus on the Timeless

This is the main topic of Perennial Seller. He looks at businesses, books, and philosophies that stand the test of time. And in these timeless things, he’s able to draw principles and lessons to apply to our own businesses, products, and lives.

For example, he brought up how Amazon – while they do a lot of very complex things – spends a lot of their focus on the things that don’t change: people love cheap stuff, great customer service, and free shipping.

Instead of thinking about what is popular now – think of how to create something that can last for many years to come.

“Can’t be the noun without doing the work.”

This came up several times in his talk and then again at dinner. It’s like being around people that love to attend startup and entrepreneurial events and talking about business ideas but aren’t super interested in doing the work to actually grow a business. Or people that want to have a book, but maybe less interest in actually writing a book.

If we want to be successful with our goals and aspirations, we have to put the time into making them a reality. And that means doing hard things, enduring focus when distraction calls and often saying no to shiny objects in order to keep a solitary focus on what’s important.

Ryan showed us some screenshots of the folders on his computer where he kept his daily book edits. It was a very long list of file names with daily iterations and versions. Proof that the road to finishing a book required many a day behind the glow of his laptop by himself.

Marketing is Just As Important, If Not More So Than Initial Creation

He said he carves out the same amount of time to market his books as he did to write it. So if he spends a year writing, he spends an equal year promoting. A useful rule of thumb, but the main takeaway here was a lesson I already really know which is creating a product is just a small piece of the success puzzle.

We’ve spent the last three years at UGURUS almost exclusively marketing our 10-week Bootcamp. Part of me wanted to go create a new product after the first launch was successful. We had 34 graduates from v1. Instead, we ignored the shiny objects and hammered that core product. We are now closing in on the 1000th graduate.

He Writes Mostly For Himself

This takeaway stuck with me more than anything else. It was at dinner and the conversation turned to how he stays motivated to write and whether he feels the need to master something before putting the words down. He said something along the lines of writing mostly for his own benefit – to put ideas and thoughts and commitments on the page and out to the public to help him become better at what he does.

It wasn’t always about mastering something and then writing as the “expert” – but often exploring ideas and trying to understand the world better by writing. As someone that used to write a lot and has recently been more focused on other aspects of my business, fatherhood, and personal wellness, this both inspired me and stung a bit.

I realized that I had stopped writing mostly because I forgot who I was writing for. Over the years a lot of the feedback and comments I had received pushed me to think more and more about other people when I was writing, when all the while, I was the biggest beneficiary of taking the time to put my thoughts on the page.

Using writing as a way to get better at my own life and hold myself accountable to a higher level. More about the process than an end result.

Success Can Sometimes Become a Punishment

The other thing that came up on this topic was how sometimes we find success at one thing – and the “punishment” for that success is we are pulled away from the very thing we become known for. His own example is becoming a successful author and writer. This success opened the door for a lot of things that weren’t writing – consulting, speaking, advising, and such. All things that are pretty extroverted and opposite of the craft he enjoys.

I think this success punishment probably shows up for many entrepreneurs where the product/service/reason we got into something has faded into the distance due to growing and running our businesses. I know this has personally happened to me several times over the last 17 years. It’s a cycle and can lead to a lot of unhappiness and needs for “reset” moments.

I’ll leave you with a few questions that Ryan left our audience and I think they are worthy questions of a clarity break or journaling session:

• Is this [work] the legacy I want to leave?

• Why do I do what I do?

• What do I love doing? And am I doing that right now? Why not?

• What is my #? (And if you don’t have one, it will always be more)

Before I started using EOS in my business, I had very little clarity on how my business was performing. At the end of the month, I’d tally up some numbers and figure out whether I turned a profit or not – but outside of that exercise I had little else to rely on. Maybe my checking account balance.

If my business was an airplane, I was flying it into a storm with only an airspeed gauge. While useful, not really enough to get me through what was about to happen.

One of the six key components of EOS is “Data” which is applied via a Scorecard and Measurables.

Before implementing a scorecard – I had plenty of access to data through programs like Google Analytics and our recurring billing platform – Recurly. But jumping into your website analytics or billing system here and there provides little context to what is actually happening on the front lines of your business.

Implementing a scorecard with just 5-10 numbers on it that you check each and every week has changed me as an entrepreneur.

It’s been a long road.

Sometimes I will track a number for weeks – or months – that ends up having little to no correlation with success in the business.

Sometimes I will track a number and hate what I’m seeing for weeks. The numbers will be plateaued… or going down… and no matter what you try you can’t get them to change.

But then they’ll be a breakthrough. All of a sudden I’ll see something deeper in the data. Or have a realization about a connection between one of our numbers and another. Each week pushing deeper into the mechanics of the business.

With a scorecard, I ultimately want to see the health of my business on a single, one-page spreadsheet. It should tell me if there is an emergency. If our marketing campaigns are effective. If our customers are loving our products. If they are getting the results we promise through our value proposition. If there are leaks in our administration or finance.

I should be able to look at my scorecard and not just see how things performed (lagging indicators), but also where things are headed (leading indicators).

Examples of lagging indicators:

• Cash balance

• Revenue

• Profit

• Sales

• Members

Examples of leading indicators:

• Website traffic

• Ad spend

• Clicks

• Optins

• Leads

• Sales calls

There are countless metrics that you can track in your business. And these days, plenty of cool data platforms to visualize this stuff. But too much data can be a big disservice. It’s hard to influence a dozen or more numbers simultaneously. On our team, we make sure each number on our scorecard is owned by someone. And ideally, each person only has a few numbers to keep their eye on.

Less, but better.

While there are certainly a lot of numbers that might be interesting to know or keep your eye on from time to time, your scorecard should be the essential few that if improved – could dramatically change your business for the better.

Every business should have 3-4 of these numbers and then maybe another 2-3 numbers that illustrate the overall health of the business.

But your business is your business. And your scorecard will be unique. Over the last three years I tracked a lot of numbers on our scorecards that I no longer do. I think everyone has to go through this evolutionary process in their own way. Sure, you can get some guidance, but it’s such a personal thing.

Here are some quick lessons learned around scorecards from the trenches:

• Stay disciplined. Update your data every week and hold yourself accountable to your goals.

• If you miss a goal, add an issue to your issues list to either take a clarity break on (if you are solo), or IDS (if you have a team)

• Use a single spreadsheet and only show the most recent 13 weeks for clarity. Use the “hide columns” feature to remove old data – but keep it around in case you want to use graphs to better understand your data.

• Use graphs to better understand your data. I’m a visual guy and several of my “data breakthroughs” have come when looking at data visualized over time… and in some cases layering different numbers over the same timeline.

• Leverage a VA (virtual assistant) to compile data once you are certain about your numbers. This will save time prepping for your weekly team meetings.

Scorecards helped me so much in my business, I also added them to my personal life by shifting to a single number budget. This allowed my family to forget about monthly spending categories, automate all of our finances, and keep focused on controlling our discretionary spending to a single number each week. We’ve successfully operated on this budget for over two years now! That’s crazy talk for most people when it comes to sticking to a regular family budget.

Are you using a scorecard in your business? If so, what numbers do you track each week? If not – how come? What’s holding you back?

After a few weeks without… my life didn’t come crumbling down. Matter of fact it got way better.

My time in line at Starbucks or taking the car for a quick trip has turned into a really nice breakfast habit with my 2 year old son.

Our family meals out have been replaced by even more delicious home cooked entrees and conversation about nourishment and meal planning.

The lack of domestic help has turned into a few adventures into the unknown. Overcoming obstacles that have helped me learn new skills and build confidence.

The other day one of our deadbolt locks broke. I had never changed out a lock before. My usual MO would have been to hire a locksmith at $180. Instead, I biked with my son to Home Depot to get a new lock, the clerk rekeyed it in front of us which we both got to watch, and then we replaced it together back at the house. All in I spent $12, got 45 minutes of cardio exercise, and 30 minutes of quality time showing my toddler how to find instructions on Youtube and fix something in our house. He even got to use his tools (which he LOVED).

Without even considering the quality time with my son, I was actually ahead on time spent even though I didn’t outsource it. Usually to get 45 minutes of cardio in, I would:

• Drive 20 minutes to the gym

• Do a cardio workout for 45 minutes – but add another 15 for misc time at the gym for steam room, etc

• Drive 20 minutes back to the house

(And that doesn’t even count if I were to take my toddler to the gym… which probably ads another 20 minutes to corral him from the day care.)

If I would have outsourced this task, I probably would have spent longer once you think of it in this light.

So far, optimizing for my spending had brought more happiness to my life and only mild discomfort.

It was time to dig deeper and give up a sacred cow that might cause a larger amount of discomfort – and in theory – a larger amount of happiness and life satisfaction if worked through.

My Car

For a long time I wanted a nice car. It seemed like what you do when you finally “make it.” Get a nice car, right? I have friends that have bought Teslas and Ferraris and I wanted to make sure I played my part too in the portrayal of a successful entrepreneur.

Which brings me to another sacred cow that was on my list that felt untouchable. My Mercedes-Benz. In an email exchange with Mr. Money Mustache, he coined it my “gas powered racing wheelchair.” Which is a funny way to look at a luxury automobile. Especially such a nice one.

I enjoyed driving the car. Felt successful and cool when driving it. And it was a bit of a feather in my cap. I had even caught myself saying on occasion, “I love that car” which I stopped doing once adopting the Love People, Use Stuff mantra from Minimalism.

But the vehicle was unnecessary. I really didn’t drive much. I mostly work at home or since getting my bike, enjoyed bike rides to my office.

I ran some numbers and the cost of owning a second car, when unnecessary, was pretty steep:

• Capital tied up in the vehicle

• Insurance

• Premium gasoline

• Expensive service

• Regular wear and tear

Back of the envelope math said that if I gave up my car, rode my bike 90% of the time I used to drive, and stayed a one car family, I’d have an extra $135,000 in my pocket after 10-years. And I’d probably be in pretty good shape.

Not everyone is in a position to do this, but I am due to my office being close to my house and living pretty much in downtown Denver with plenty of stores within 2 miles. The math and logistics started making a lot of sense.

Burning My Boat

One of my preferred methods of operating is that of “burning my boats to take the island.” And in this case, Financial Independence and a Happy Life is my island.

My mindset was quickly shifting to that of getting rid of this next sacred cow as both a way to increase my savings rate AND add discomfort and challenge to my life to further increase my happiness. Win win I say.

I had made a commitment to myself to ride my bike instead of take my car. Each day I went to my garage and chose my bike over my luxury sports sedan. But there was risk that even with my commitment to a new way of living, that I could fall down and once again enjoy a blissfully warm tushy with my heated seats if it was too cold outside or weather not permitting.

As Mark Reynolds commented on my previous blog post:

“We often hear people talking about new exciting approaches to life which are usually so interesting and inspirational, but we don’t hear when in 12 months time, those things have stopped or aren’t being done to the same standard as at the beginning.”

I decided I wanted to put myself in a situation where I wouldn’t be tempted to lose footing on the changes I was implementing into my life.

And after a couple of weeks, I started wondering what was keeping me so attached to the having the car.

Biking to work – even in terrible weather – was making me feel like a badass on the inside. There would be days where my bike rides around town would fill me so much full of energy that I would be bursting with joy.

I never had that feeling driving even the nicest of cars.

So it was time. My boat, errr Benz, needed to be burned. If I am going to take the Financial Independence Island and live a life full of joy and happiness through increased challenge, I needed to be up for a big shift.

I listed my car on Craigslist and soup to nuts spent about 6 hours of labor selling it between getting it ready, taking pictures/posting it, chatting with potential buyers, and the single test drive it took. It didn’t hurt that the car was extremely low miles and in impeccable shape. The hardest part was that it took a while to garner interest as Craigslist isn’t a super hot market for luxury automobiles.

Now That We’re a One Car Family

Articles I read ahead of going to one car, noted the need for additional planning. This is very true. We do have to plan a little, but not much. My intent of going to one car was not so that I could drive our other car more – I wanted to drive it the same amount – but ride my bike significantly more.

Recently I had an EO Colorado annual retreat to attend at Estes Park. I put a call out on the Facebook group to carpool and ended up getting some excellent networking time in with a couple of entrepreneur buddies of mine. Which was a way better use of vehicles and time than me driving a cool car all by myself.

I can’t always take my bike. Sometimes time doesn’t allow for it. So far on two occasions I’ve needed to get an UberX to get somewhere because I was unable to bike in the time allotted and Emily had the car. I calculated and just for the cost of insuring my Benz, I can take 150 local UberX rides per year. So far with avoiding my car for over a month, I’m doing pretty good here with only needing to do so twice. I think apps like Uber and Lyft make going to one car a much less risky affair. I think in the future most folks will have one or no cars due to the shifts in technology.

Weather in Colorado is quite unpredictable. Biking in the snow can be quite enjoyable. I wear a little snowboard gear and all is good. However, on two occasions I was poorly dressed. One snow in particular was quite wet and it soaked through my pants and froze my legs pretty good. I found myself letting out loud roars that my son calls “T Rexing.” Quite cathartic.

Another time a bit of misty rain turned into real rain and I ended up leading my weekly L10 meeting with soaking wet pants. You might read that and think, “Is he ok?” And you are probably on to something. But to me recently, all this means is I get more challenge in my life. More challenge means overcoming more adversity.

Some of the most impressive people on the planet are the ones who have grown up overcoming adversity in their life. When life constantly throws you hardship – doing hard things becomes second nature. Achieving the kind of success I want in life is hard.

So I’m doing more hard things. And I’m loving it. My mindset about my business has been more driven, committed, and focused. My relationship with my wife has been even better than normal. I am more present with my sons.

Which brings me to my question of the day:

Are you holding on to any sacred cows in your life right now that, if removed, would add happiness or freedom to your life?

If so, I’d love to hear about it in the comments below.

Until next time.

But it wasn’t long… and I too had a $50k a year draw.

Turns out I acclimated quickly and no longer had the sense of “having it made” I thought I would.

And this cycle continued upward.

When I started thinking “When I earn $500,000 in a year  – then I’ll have it made” I realized I might have an optics problem.

Just seemed like no matter how much money I had in my life, it was never enough.

The crazy part was how much my overall sense of purpose and well-being became married to the pursuit of more. New and shiny phone. Faster and more lux car. Bigger and better house. I became addicted to the modern day miracle of one-click purchasing on Amazon (in 2016 I made 109 orders… that’s an Amazon order every 3.3 days!). And I stopped doing a lot of basic things around my house… like yard work, house maintenance, cleaning, grocery shopping and food prep through the use of trendy new services and regular ‘ol hired help.

Always in the pursuit of “optimization.”

Even trading innovative service recommendations with other successful entrepreneurs that would eliminate more of the mundane tasks from my life. Always working to reduce responsibility or hard work outside of my chosen area of professional focus. I think in hindsight I was optimizing my own comfort, which I think I believed was synonymous with happiness.

Turns out it’s not.

When I got to thinking about it – most of my big breakthroughs and ‘ah hah’ moments came when my head was down doing manual work outside of my usual computer-based professional time. It’s when I’m painting my sons bedroom, mowing the lawn, or installing new tile for my bathroom floor that I get relaxed enough and away from the *immediate* problems of the normal business day that give my brain the Alpha boosts it needs for the next breakthrough.

In the days following the birth of my second son this past February… I began taking a fearless inventory of who I was, the thoughts occupying my head, and the general purpose behind my entrepreneurial pursuits.

I started to recognize that I really wasn’t happy. I worked a lot. My work is meaningful and fun and amazing. I had a lot of help around the house so I could work even more. And I had an insane amount of great things that made my life easier and more convenient.

I was comfortable, but not happy.

Admitting that you aren’t happy is not an easy thing.

Thankfully, in the wee hours of the night while watching my newborn, I stumbled across the movie Minimalism.

I felt like someone jumped out of the screen and punched me in the face. Perhaps it was because I was extremely sleep deprived with just a week old newborn. Or perhaps it was the beginning of the ultra-consumer soul buried deep within me dying.

The big takeaway from the film for me was:

“Love People, Use Stuff”

And it occurred to me how simple language like, “I love my car,” or “I love my iPhone” – although probably not meant literally – had actually crept into my life. How often had I wasted hours researching the newest device or gadget thinking that it would help me finally achieve a better state of happiness?

It’s easy to get sucked into not wanting to make radical change in our lives due to stuff holding us hostage.

A while back I read Essentialism which advocated a similar and simple idea of “Less but better” which I had applied to my business, but not so much to my life outside of entrepreneurship.

I wrote a personal manifesto.

Shared it with Emily.

She suggested the movie Happy.

This movie added a few more basic ideas to my new mindset. Turns out, I had been focusing a lot on extrinsic goals (money, status and power) – and most of us are better off when we pursue intrinsic goals when it comes to raw life satisfaction and true happiness.

The three intrinsic goals the film reviews:

1. Personal growth

2. Develop meaningful relationships with friends and family

3. Serve your community by giving back or helping others

The final domino for me fell when one of the investing platforms I use, Betterment, raised their prices. To find out what was up, I stumbled upon a blogger covering the price increase.

Turns out this Mr. Money Mustache (or MMM for short) had a lot more in store for me. In hindsight, the increase in Betterment’s pricing – while annoying – will probably add at least a million dollars to my net worth over the next twenty years by implementing Mustachianism.

MMM “retired” when he achieved Financial Independence at the ripe young age of 30 through earning a pretty average amount of money and saving most of it through “badassity” or sophisticated frugality, investing his savings, and avoiding becoming an ultra-consumer like the rest of us. The crazy part is… he really never gave up any mainstream luxuries to achieve it.

AND, more importantly, much of this badassity, frugality, and more intentional living put him into an almost constant state of HAPPINESS and JOY.

One of the things MMM has helped me see is that most of us in the US make a boatload of money right now – not some fantasy future date we’ll eventually arrive at (the constant cycle I’ve found myself in for the last decade). We have just become accustomed to spending pretty much everything we make. To the tune that most people consider a 10% savings rate worthy of a high five (it’s not – it’s actually bare minimum and we should all probably be more in the 50-75% ballpark).

I am not pursuing financial success so that I can live a luxurious life full of bling. I don’t want to be a gagillionaire on a yacht with fancy martinis and a butler. That is one outcome of wealth (or perhaps just spending wealth). I want to become wealthy so my money works for me and I don’t have to anymore.

I want to spend time with my family, educating my sons about how to live a life with purpose, be an amazing partner and best friend to my wife, do great work that helps others with fun and interesting people, and leave the world better than I found it.

I want to be financially independent so I can live a life without compromise. I want each hour on this earth to build a deeper sense of freedom and happiness for myself and those around me.

I think one of the big shifts for me this year was realizing that I wanted to drastically move up my financial independence goal. Like many – I saw a more traditional retirement in my future. Something achieved at 55 or 60 or so…

What MMM helped me realize was that I could move that target up to something much more audacious – like 7 to 10 years by spending a lot less on all these things adding comfort (but not happiness) to my life.

So far this year, I have made a handful of Quickstart moves in this pursuit:

1. Purchased a used bike on Craigslist and began using it for my regular transportation around town. This has been incredibly liberating. While it takes a bit longer to get places – the exercise I’m getting means I don’t have to go to the gym – a very time consuming (and expensive) activity. Another benefit so far has been working out my willpower muscle a bit more. Once you’ve biked to work in the freezing rain in a pair of shorts… all of the other challenges you have that day seem a bit easier.

2. Cancelled almost all forms of domestic outsourcing (cleaners, yard help, food delivery, night nanny, etc). I say almost because there will undoubtedly be a need for childcare with our nanny from time to time.

3. Kicked my takeout coffee habit. A lot of financial bloggers and luminaries proclaim that cutting small expenses like coffee is a fools errand on your way to becoming a millionaire – but MMM gives you a simple formula on how to calculate the lifetime return. Multiply any weekly expense by 752 (monthly by 173) and you’ll get the 10-year return of that money if you chose instead to invest it. The $30 per week I spent on coffee will add up to $22,560 or enough money for an all expense paid month in a castle in France, but I’m working on financial independence – not a cool vacation. By the time I’m 65 – this habit change will add approximately $160,148 to my net worth. This is a significant amount of money – which for most people would shave 2-5 years off the necessary working years. Buying coffee out doesn’t make me feel guilty – it’s more that I now realize that I can make coffee at home for 1/10th the cost and the effect is the exact same for me: caffeine in the blood.

4. Cut way back on eating out. While this has required some additional time planning meals and my week, I don’t think it takes up more time – eating out is a time consuming affair after all. Doesn’t hurt that Emily is a fantastic chef (who loves cooking). Why do we ever eat out? Let alone to the tune of $6k+ per year! We live pretty active lives… and it can be easy to just run out of the house without thinking. Now we’re like, “what can we grab to snack on or for a meal on the run?” which is great because now we have small picnics on our outings regularly. And who doesn’t love a picnic!

5. Created a list of 10 activities that make me happy and are healthy for me. Funny enough – not one of them costs any money. Already I have found myself looking here first when I have a smidgen of free time. And there isn’t a whole lot of time for things that cost money once I’ve cleared through the list.

   

6. Cut several subscription services that were not helping me grow as an individual. Mostly news services… that if anything were distracting me from what’s important. And making my overall head a noisy place.

7. Writing at least a few times per week again. Writing for U Gurus or even my own blog always makes me feel like I did something useful. And it’s an activity that is expanding my influence in the world and not just making my hair turn grey faster like reading the NYT.

I have a few other things in the works (some big, some small) that I’m really excited about which I plan to blog about in the near future.

And the good news is I’m finding my mojo again. I’m feeling more creative, driven, and happy each and every day. At a time when I am extremely sleep deprived and should be at my wits end – I’m full of energy and excited about life!

All without moving to a swank house, upgrading my car, or outsourcing another task around the house.

So there you have it. A taste of where I’m headed and why I think it’s awesome.

If you’re an entrepreneur pursuing financial freedom and happiness – I’d love to hear about it…

What’s working for you?

Over the last couple of years I have been asked a lot of questions about EOS.

Why do they call it an “operating system”?

Like a lot of entrepreneurs, I didn’t go to business school. I love to build products and services and solve problems. I have a lot of experience running a business. What I found for years was that I spent an incredible amount of my time working out some basic things around meetings, structure, planning, and people. I felt like I was reinventing the wheel. And I was.

Imagine that you wanted to write an amazing blog post, but before you got into your favorite writing application that you needed to first build an operating system for your computer. That would sound pretty crazy. But entrepreneurs do it every day. We get a product or service to market, get some traction, and then start building a business around it. I found myself spending more time working out the business than serving my customers.

So I installed an operating system.

EOS doesn’t really make your product or service great. Just like it doesn’t really matter if you are on Windows or Mac for most of us. The system just provides the blank canvas for you to work within.

Can I go it alone or do I need to hire an Implementer?

An Implementer is a trained EOS consultant that helps you apply the “operating system” to your business. We use Bobi Siembieda. If you have the funds – use an Implementer.

If you are just starting out and you don’t have the budget, try to find another entrepreneur – or a self-implementer group like Traction Groups – that are on EOS so you can learn from them. There are a lot of pitfalls and obstacles that can stand in your way and become major barriers to you getting the most out of the system.

When we first hired Bobi, she said that we’d work together for about 18-months and then we could go it alone. We’re way past that. Having a facilitator and trained EOS expert to help me get the most out of my quarterly and annual offsite sessions has proven a high ROI. I get to be fully present in thinking about the issues, ideas, and vision for my business. I’m not worried about running my agenda.

I’ve also been known to politic a bit. Bobi is great at reeling me in.

How much does an EOS Implementer cost?

I won’t publish Bobi’s prices since it’s not my business. But, EOS told me the range is between $3,000 and $10,000 per daily offsite session. We have three “quarterlies” that are each one day and then an “annual” that is two days. We also do our sessions offsite – so you might also incur some meeting room costs and catering.

I think all-in it costs us around $20k-ish per year. It is money well spent.

What does an EOS Implementer do?

Think of them as your guide to getting your business operating on EOS effectively. They will also be your facilitator for your offsite meetings. Bobi runs our agenda, keeps us on point, helps us gain new vantage points when needed, and offers advice and perspective from her experience.

I’m not sure what other Implementers do, but in between meetings, Bobi makes herself available to our leadership team for impromptu calls. I have been known to shoot an EOS “SOS” of sorts on occasion to Bobi when in crisis. She considers this part of our quarterly investment in her and does not nickel and dime us for this time. This availability has helped me get unstuck in a big way.

I’ve also used Bobi as an adviser to big decisions in the business. This could be around personnel changes or even an emergency pivot mid-quarter. Over the last couple of years she has gotten to know our business from the inside – the most intimate details about our financials, people, goals, vision, etc. Having an adviser with this perspective that is outside of the business is priceless. Sometimes it’s hard to read the label from inside the bottle.

What kind of obstacles did you have early on?

I think like anything, even though there is clear and concise instructions, they are open to interpretation. EOS is a lot to learn – and you are running a business simultaneously – so it can feel like you are taking a step back. I’m going to break down a few of the components to answer this question better:

• L10 Meetings
  These weekly sessions are the heartbeat of EOS. One of the things that we stumbled with was how to prioritize issues. We would have eight or nine issues on the whiteboard, and then we would “prioritize” them and we’d spend 15-minutes arguing about how to rank them. Our mistake was that we were ranking the whole list. The trick here is to just rank the top-three issues. A simple “1, 2, 3” next to the top issues and then you work those. When you finish the third, you re-rank the top three and start over.We also implemented a guideline of two types of issues that get precedence over others – any issue related to a “Company Rock” trumps all others and get’s first priority; any issue related to an “Individual Rock” then gets the next priority. After that it goes based on any urgent/important issues or things that people feel are pressing. You want to spend as much time IDS’ing issues, so prioritization should be done in seconds – not minutes. Get through it so you can dig in.

• Scorecards
  Oh the frustration! Scorecarding has probably been one of the most painful areas of EOS for us. Over the last three years, we have tracked so many numbers that are worthless indicators of our core business. We’ve spent thousands and thousands of dollars on developers and analytics platforms to get numbers out of our business to give us a glimpse of what is going on. After almost three years, we finally have a really good, concise business scorecard that tells us key numbers that indicate the health of the business – from both a leading and lagging indicator. Bobi always said “less is better” to keep us from going too number crazy. But it didn’t matter. We threw a lot of “wouldn’t it be nice to know” type numbers on our scorecard for a while.I recommend using the Getting What You Want exercise here and do your best to pick a couple of numbers that are true indicators of what you are trying to achieve in your business. Just because you are interested in learning a number in your business, doesn’t mean you need to put it on your scorecard.The last thing I’ll say here is that we struggled with the difference in a scorecard metric and an individual daily measurable. Some people in the business won’t have scorecard numbers measured on a weekly basis. For those folks, a daily measurable is great. One of my VA that handles collections has a daily measurable for “dollars collected.”

• Accountability Chart
  Our organization ballooned out after we first implemented EOS. I think our chart had something like 30-seats. We countered that with an over-simplification down to about six seats and finally settled on a really good structure of 17 seats. One of the pitfalls I found was when you had an “unaccounted for seat” in the organization. Meaning, someone on your team is accountable for a regular task or responsibility and it is not on your accountability chart. And then in other cases, we turned individual role accountabilities into entire seats.I also found that we put individual roles and responsibilities into a seat that were aspirational. Just like Jim Collins said there are core values and aspirational values – you want to be careful to avoid giving someone accountabilities that don’t really exist in your business but sound like a good idea when you are structuring your chart. An accountability chart really isn’t a creative exercise. You should do your best to capture what is actually happening in your business today – as-is – without making up tasks or responsibilities that don’t really exist.

• 555’s
  These are the quarterly “informal” reviews of team members. Be careful not to turn these into a formal review. The purpose of a 555 is an informal check-in. This should be done over lunch or breakfast in a casual environment outside of the office. Otherwise you’ll find yourself resisting 555’s if you make them more like formal reviews since it will feel like a lot of work.

• Rocks
  Ohhh you heavy, heavy loads. Rocks are quarterly priorities that you choose to push your business to the next level during your off-sites. Sometimes I feel like the Cookie Monster when it comes to rocks. Perhaps I drink too much coffee during our planning sessions. Early on I think it’s natural to think that you want to get everything done in a quarter. What I’ve come to realize is three months isn’t a very long time.What you want to avoid when it comes to rocks is choosing too many, not getting them done, and then getting into your next quarterly with either half finished rocks or being totally burned out from overworking yourself. One or two individual rocks for a quarter go a long way. One or two company rocks go even farther.A really important thing to understand is how relative the quality of a rock is getting done and how much you take on. Rocks ARE NOT todo’s. They aren’t something to check off a list. For example, if my rock is to “launch a new website” but I take on two other rocks along with that one. There is a giant continuum when it comes to the quality and effectiveness of the output for a thing like “launch a new website” based on how much other stuff I have going on. If that was my only priority for a quarter, I would probably put a lot more effort and thought into it versus trying to rebuild my website while balancing two other big priorities at the same time. This trade-off is important to think about when you are planning your rocks.If you overcommit and end up completing a rock, but you didn’t really get it done to set yourself up for long term success, what you’ll find is it impacts your rocks and todo’s downstream. For instance, if you cut corners on your new website and it doesn’t end up producing new leads and customers for your business, then you might find yourself trying to take on rocks in the future to solve these problems.I stole my mantra for Rocks from Essentialism – “less but better.”

Why is EOS causing problems in my business?

I have found myself trying to blame EOS several times over the course of using the system. Especially when we would uncover a purpose, trajectory, or issue that caused me a lot of stress. I think it’s easy when you uncover a big stinking problem with an EOS tool to think the resulting stress or frustration from that issue is the fault of EOS.

We have uncovered a lot of problems with our weekly meetings and quarterly offsites. We’ve aimed for big goals in our annuals. We’ve made a LOT of decisions and not all of these have turned out great for us or without causing someone grief.

Here is an example of heartache that have happened during the course of EOS activities:

• Eliminating jobs ie. layoffs

• Changing directions and dropping products or services

• Realizing someone wasn’t performing and firing them

• Realizing someone wasn’t a culture fit and firing them or they quit

• Arguing about the direction and purpose with my business partner

• Taking on new responsibility that was outside of my comfort zone

• Engaging in frustrating disagreements with team members

• Being disappointed about missing a goal or objective

• Over-committing to too many priorities or Rocks

The best analogy that I can provide about EOS causing problems is to compare it again to a computer operating system and the quality of what you produce on said operating system. Sure there are times that Windows doesn’t bend to my will, but usually that’s because of me, not it. And the quality of my work or output really is independent of a modern day operating system.

There have been times where I thought I would be better off without discovery key issues in my business or aiming for big goals – but that’s just ridiculous. I’d rather get into the dirt – no matter how dirty – and build an amazing business. EOS is probably not causing your problems. It’s just bringing them to light – and that’s a good thing.

How long does it take to get to 100% in all of the key areas?

Perfection is unattainable according to Bobi. And how you judge yourself in your key EOS areas is kind of up to you. Very subjective. You’re 60% on data might be my 90%. I was told that it takes about three years before you feel like it’s fully implemented. Might sound like a long time, but it flies by…

I think I will still be discovering and learning about how to leverage EOS as our business operating system for many more years to come. There’s so much growth opportunity when it comes to being a better entrepreneur. I feel like the second I get to a 90% confidence – I’ll also understand a specific area even better and realize how much more I have to learn. I think they call that the expert dilemma or something – where you don’t really know what you don’t know until you become an expert at something and then you’re like “I know nothing!”

I felt measured breakthroughs for EOS at six months, a year, and eighteen months. A bit after two years I felt like I took a big step backwards. As I approach year three, I’m feeling a new level of optimism in our six key areas.

Is my company too small to adopt EOS?

While the organization says that EOS is a great platform for companies ranging from $2mm annually to $50mm – it can be transformational for smaller businesses too. We were less than $1m when we adopted it and are now close to $2m.

I have seen entrepreneurs adopt the framework with $100k in annual revenues and even $50k. I think there are fundamental ideas within EOS that can be powerful for a business at any size:

• Create a simple vision and business plan that can fit on one to two sheets of paper

• Keep a regular standing meeting where you meet with your team and work on core issues

• Track a few numbers on a weekly basis to get a read on the health of your business

• Take one day per quarter and two days per year to step completely out of your business and “work on the business”

• Continuously work to improve your business’s Vision, Data, Process, People, Issues and to gain Traction.

One disadvantage of being a small business with limited revenue is that it will be tough to hire an Implementer.

Can I mix EOS with other business management systems?

The folks at EOS advocate that you keep to a single system to run your business. It’s better this way to reduce confusion or conflict of how you operate. That being said, you might find that specific departments or teams adopt things like “agile” to manage projects or quality assurance teams might take concepts from Six Sigma – that’s ok. What EOS wants you to avoid is mixing and matching how you approach your overall company operating system.

I’ve gotten pushback from people on this a bit. I tend to run pretty orthodox EOS and work to avoid bringing in other systems. But recently I found a conflict because I started using the Who method to improve our hiring processes and they use a “Scorecard” as a way to outline a job position and desired outcomes. Just this language being the same as our business scorecard from EOS caused a lot of confusion in our meetings when it came to todo’s around hiring new team members.

That’s it for now!

If you have questions about EOS, let me know by leaving a comment below. Happy to add to this guide over time.

And ultimately, I’m after great ideas.

Especially when new products are concerned. For a while I would come up with a new idea and just because a few people might be interested in the idea, I would put resources forth to launch the product. This led me to create several products that were either complete duds, or in a sense, worse than a dud – a product that happened to generate some revenue, but nothing substantial.

I say that is almost worse–because in a way it turns a shiny object into a shiny object with a slight magnetic pull. Ever so slightly, it pulls you away from the real meat and potatoes of your business and eats away at your time, energy, and dollars.

Basic Benchmark

About two years ago I decided I would give myself a minimum threshold for new products. I don’t do a huge amount of projection work as this can become consuming and misleading. But what I did make myself do was some conservative projections to see if the product idea I was working on could become a seven figure product (otherwise put, generate at least $1,000,000 in annual revenues). If it couldn’t, then there better be a really good strategic purpose to pursue the product.

If it couldn’t meet this threshold, then it wasn’t worth the time as it wouldn’t be in service of our three and ten-year financial targets.

Even if there is a market for an idea–if it will only generate $100,000 or even $500,000 a year, the opportunity cost for me is too great. I would need to take that idea back to the drawing board and either improve it, or throw it out and wait for another to come along.

New products always take way more time than anticipated. Besides the time, they require financial commitments, energy, and even stress. I only have so much appetite for MVP development, feedback loops, and critical thinking in a given year.

Anyone that thinks they have an infinite appetite for such things surely hasn’t launched many products. And they don’t live on earth.

The Bigger Upside

Besides investing time in new products that will never reach your desired expectations, there is something else that I have learned in the past two years that is far more valuable a lesson.

Let’s say I build a seven figure product. Time to build a new one right? Then I would have two seven-figure products!

And this is where entrepreneurial wisdom is required.

When we did our first launch of $10K Bootcamp, it was really exciting. We sold 34 units in a couple of weeks and our MVP-launch was validated. About halfway through the first cohort, we knew we had something special. Lives were changing. Entrepreneurs were being empowered.

But it didn’t fail–in our quarterly offsite, the idea of new revenue streams and products certainly came up:

“Let’s create a recurring membership to follow-on Bootcamp…”

“Let’s create a Bootcamp for creating Bootcamps…”

“Let’s create a cheaper course to feed qualified customers to Bootcamp…”

And so on.

All were good ideas. But then our team came up with the best idea:

“How about we focus all of our efforts on trying to scale up Bootcamp?”

Finding The Ceiling

Basic market research tells me that there are over 100,000 web professionals in the United States. You can assume that this number becomes far greater when you consider English speaking countries. And then it gets even bigger when you consider English speakers in other countries that are in this profession.

The realization that we had only serviced 34 people in this market with Bootcamp was an observation that could not be overlooked. Creating new products and services feel safe. We just did it. We identified a problem and built a product to solve that problem. Again, this is safe because it is a known activity.

Couldn’t we just reproduce that over and over and over and achieve scale?

Not necessarily. Each time we launch a new product, we have to validate the problem and solution fit, and then the product and market fit. There is a considerable risk to this activity. With a combination of luck, experience, and skill, we had a product and it fit our market. So time to scale.

Or “find the ceiling.”

Which is a great question to ask oneself about a product or service that you have already created:

“Have I done everything within my power to find the market ceiling for what I have created?”

Once you have a product that you think has a great market fit, the next question you have to ask yourself is:

“How far away am I from market saturation?”

In our case, we had scratched a small fraction of our market. Like 1% of 1%.

Instead of going back to the drawing board to create additional products, we have (for the most part) stuck to trying to scale up sales and marketing for a single product.

Scale Requires Systems and Investments

We knew how to deliver a great Bootcamp. We got 34 people into the program in April of 2014 and we had a 90%+ NPS score at the end. What we didn’t know how to do was to deliver the same exact product with 100 students instead of 34.

For the first program, I was the only Mentor. I ran 4 groups. It pretty much crushed me for the duration of the program–as I was leading groups and creating the product simultaneously.

Our second program had twice as many enrollments. We took a risk and brought on three Mentors to lead the program alongside me. This required me to transfer my knowledge to others which required systems and documentation.

That took reasonable effort (and was also a bit risky the first go).

What took a much bigger effort and investment, was working to double our sales. Our team enlisted the help of several contractors and a marketing agency. We put on a big livestream “summit” and spent gobs of money on advertising. For the most part, this was all new territory for us. Up until then, 98% of our leads were the result of content marketing and slowly building our email list over the course of several years.

Doubling our second cohort was a big deal. But the question I had to come back to was this:

“Had we found the market ceiling?”

Undeniably no.

We were still batting in the space of a small percent of a percent.

But in the past, this success would often give me the confidence to create a new product. Because I had so much success with this one product, surely we can launch another product with the same success!!!

And this is where entrepreneurial wisdom has again come to my aid. Realizing that we are far from the market ceiling, and that further investments in sales and marketing are going to be the big levers to pull, not in ramping up more products.

I want to be totally forthcoming in that even knowing everything I know about sales and marketing, it is still hard to think to yourself: “I need to double, or triple down on my customer acquisition efforts and NOT add new products.”

Double Down Scale

For uGurus, doubling down on sales and marketing over the last year has required a lot of work, money, and risk. We hired a marketing manager. We hired a full-time sales rep. We started spending more on ads. And this doubling down has begun to work for us. We continue to add more enrollments to Bootcamp.

And we’ve gotten some tastes of scale with cohorts that have included over 100 students.

But a taste of scale is not scale.

It would be really easy at this point to take our foot off the pedal and think of other mainline products to produce. I have lists and lists and lists of ideas, problems to validate, and possibilities.

Yesterday I asked myself a question:

“What would it take for 10% of the US market to go through our Bootcamp?”

This would be around 10,000 students. Let’s say we accomplished this over a five-year period of time. This would add up to 2,000 students per year. Based on what we are doing per cohort right now, even pondering this brings up many questions:

• What processes, support, and infrastructure do we need in place to maintain the current “magic” of our program at this scale?

• What kind of investments and infrastructure in sales and marketing would be required to achieve this market penetration?

• What insights about market appetite can I find to determine if this goal is even plausible?

When just considering the marketing and sales infrastructure, I know that right now, we do not have the required pieces in place to support that kind of growth. As the entrepreneur in the business, I then need to consider the tradeoff of creating new products versus focusing 100% of my efforts on that problem. It’s hard (or impossible) to do both simultaneously.

Ceilings Interest Me

I found the ceiling in one market (or near to it). I created a product and saturated every known channel to acquire new customers. There was nothing that would add a marginal addition that was worth the investment of time, energy, and money.

But it was a small market.

At that point, the only way to increase revenue, would have been to add additional products and services to our offering. Sell more to existing customers. My revenue scale would have always been a limit of the customer pool which was a limit of the market size. I could have increased revenues by two, three, or maybe even five times. But never ten or fifty.

So I sought a new ceiling.

And now I must stay steadfast in my commitment to find the ceiling. Resist the temptation to create new products. Double down on the hardest part of any business: customer acquisition; and make sure my product and delivery infrastructure is poised to deliver.

In my training and mentoring of entrepreneurs on a daily basis, I observe many that quickly abandon a market or product idea at the slightest hint of success. They land a single client or customer – receive revenue – then move on to the next market. I am sensitive to observing this as I have personally endured such decision making on numerous occasions.

If you find yourself at a similar juncture, I want to hear about it. Have you thought about the market ceiling for what your business offers? Can you overcome the temptation of new and instead achieve scale?

I’d love to hear about it.

Until next time.

For the last year and a half, I have managed to stay focused on the first of these programs, it’s called the $10K Bootcamp. The program helps web professionals sell and deliver their first $10,000+ web project. There’s more to it than that, but that’s the gist. I say “managed” because, in the past, I have launched products and before I even get to see how the product scales, I’ve gone right back into creating the next big product. Thankfully I resisted the urge this time around.

A few months ago we decided it was time to launch our second program of this format. Prior to launching, I did my usual surveying, customer development, and internal clarity work to figure out what problem we would solve in our market next. The one that jumped out most to us was the concept of “recurring revenue.” Thus, the Recurring Revenue Masterclass was born.

One of the key decisions we made for this second program was that we wanted the effort to be led by one of our star Mentors – Jon Hinshaw – instead of myself. This decision was to test a key hypothesis of whether our brand and programs relied on my expertise and status in our community or if we could, in fact, deliver a successful program with another Mentor acting as Guru. This has been a long time vision for uGurus: to build a network of Gurus – and empower them to empower entrepreneurs.

Avoiding Wasted Energy

One of the big problems when launching new products, is you aren’t quite sure exactly what you need to deliver in order to satisfy the promise you’ve made. Most features go unused. Which means most effort put into a product or service is actually waste.

This is particularly troubling when creating education programs. Because the programs we build not only take effort for our team, but also take an immense effort on our customers part to be successful. Our goal with the Recurring Revenue Masterclass was to help web professionals add at least $1,000 in additional recurring revenues to their ledger in five weeks. In order to do so, we needed to:

• teach our students a bunch of new concepts

• figure out how to get them to apply those concepts into their business

• hold them accountable to implement and take action

This requires a plethora of activities. Watching videos to learn new concepts. Spending time working on the business. Attending group meetings. Working one-on-one with a Mentor. All of which take up a lot of time.

An unavoidable fact is in our early MVP (minimum viable product) versions, we’ll probably build some waste. If I want my programs to scale and be even more impactful for my customers, I need to find this waste. I also need to know what to build next. And prioritize all of that based on the most impact to my customers while not forgetting our profitability. Probably more art than science, but solving this problem with more of a scientific method approach has worked well for me.

Operating Lean

I’m a big fan of Running Lean. I like to conduct interviews continuously with customers – before I launch a product while I’m launching, and of course, after I’ve completed delivery.

This concept of getting in the head of my customers to learn about their experience with my business was something that I completely ignored for the first thirteen years as an entrepreneur. Early on I figured that what I did was great and if someone wanted to let me know how to improve it they would.

But these days I want products that change lives. I want to create things that make a dent. And in so doing, I can’t ever be satisfied with the first version. I can’t just be open to constructive criticism, I need to demand it.

So I interview.

One of the tenants of the Lean Movement is to make sure you aren’t operating under untested assumptions for too long. It’s easy to sit in a room and make broad generalizations about your customers. It’s safe. But in doing so, you might invest far too much in an idea that forces you to do work that will be unrewarded. Assumptions can quickly lead to waste (and all sorts of other negative obstacles).

Debrief Basics

Steve Blank says “get out of the building,” which in my case means getting on Skype video chat to talk about the experience my customers just went through. The first cohort of this new Masterclass was about thirty people. This is a great MVP class size for a first go as it is manageable to speak with just about every person for at least a half hour within a week.

My goal would be to speak with each and every customer. This definitely adds some overhead to product delivery, but the value for future versions of the program will be far worth the investment. I did this for the first three versions of $10K Bootcamp (we’re now going into version 7) and the results yielded an even more incredible experience for each cohort.

Here is a quick rundown of how I set up and run these interviews:

• Email customers to request the debrief meeting

• Send them to an online scheduler tool to book a spot on your calendar (I use BookFresh, but others like Calender.ly would also work); this makes it possible to block out a couple of days to dedicate to this

• In person would be ideal, but my customers are all over the globe, video Skype or Zoom works great; Zoom has built-in recording, whereas Skype would require you to use Snagit or Camtasia to record (I prefer video so I can see body language)

• Have a consistent set of questions as a starting point; consider a mix of qualitative and quantitative questions

• When the interview starts, make sure to start by setting expectations and agenda: “The reason for this meeting is for me to get feedback on your experience through our program – please be as open and honest as you can, the good, the bad, and the ugly is what I’m after.”

• Let them know you plan to record the session

• Get on interviewing!

• Take notes; I use Evernote – create a new note for each person and copy/paste my questions list to the note for guidance

I typically block out thirty minutes per interview. On occasion, I have gone over this time block, but most of the time, I find it’s enough room as long as you get right down to business.

My list of questions is usually a starting point. If all I wanted was the answers to a specific list of questions, then a survey would be much more efficient. Here is what I started with this time around:

• What were your expectations of the program?

• Were your expectations met?

• What went well for you in the program?

• What part of the program would you keep?

• What did not go well for you in the program?

• What part of the program would you change?

• What could have gone differently for you?

• What would you add new to the program?

• Rate your experience out of a ten?

• What would have made it a ten? (and if they say “10,” ask what would have made it an “11”)

• [Dig into program features one by one]

The beauty of getting an opportunity to interview customers one on one is that I can dive deep into “ah-ha” moments when they appear. For this to work best, you’ll want to avoid using your questions as a list to fire off one after another. Remember, they are a starting point.

I Seek Insights

Ultimately I want insights. Not accolades, compliments, or success stories (although those are nice too).

Insights are not only things that I didn’t know before, but they are pieces of information that connect dots. Allow patterns to emerge that I did not see before. Sometimes these turn into tweaks or changes to the product. Or new things to build. And in some cases, turn out to be little idea seedlings for future products.

This round of validation debriefs has served me incredibly well. We tried a few new things with this Masterclass, and it was really important for me to learn if those things were worthwhile.

But customers will only provide you feedback and information. It is rare that a customer says something as direct as, “You should add XYZ to the product.” Usually, they speak more in stories, frustrations, or compliments. This is where your skill as an entrepreneur comes into play. You have to actively listen to catch little details that you will need to dig deeper on.

Use follow-up questions like:

• Why?

• Tell me more about that…

• How did that help you?

• What problem did that solve for you?

• Why didn’t that work for you?

And when you can focus on the problems, you will gain knowledge about their worldview, and then if you are lucky, this spark will lead to an insight.

Examples of things that emerged:

• Need more pre-made blueprint documents to help accelerate time to first sale

• Example recordings of real-life sales calls

• Time for mock sales role play scenarios

I have about three dozen other ideas that will have to be prioritized, but this gives me a great place to start when thinking about the types of improvements I will make for version two.

The real bonus for customers that participate in this is that they actually will receive most of the value that we end up adding to the program since each of our courses comes with lifetime access to the product. Win-win for sure.

Debriefs Make Better Businesses

Whether you are selling a product to hundreds of customers or delivering a service to a single customer, I would make an effort to add debriefs to your workflow. While our customers can’t tell us everything we need to do next, they provide the ingredients.

There is the famous (supposed) quote from Henry Ford:

“If I had asked people what they wanted, they would have said faster horses.”

And this is precisely what you want. You want to ask your customers about their problems, what they think the solutions can be, and then you get the (fun) pleasure of figuring out how to jump the chasm of innovation.

From “faster horses” you can deduce “get from point A to point B faster,” and then come to the conclusion that creating a faster mode of transportation that can be owned and operated by an individual is ultimately what I’m after. Then you can look at the available technologies, trends, and competitive landscape to figure out how to get there.

So if you are doing debreifs, and you are lucky enough to get such a statement as “faster horses,” you are right in the money. Let the innovations and product improvements flourish.

Until next time.

Too much emphasis on “right” vs. “wrong” decisions.

What is a *right* choice anyway? Plenty of my worst decisions have turned into blessings in disguise. So was that decision really wrong?

Who will ever know.

I know in the great game of entrepreneurship there are choices and there are outcomes. Sometimes we call choices with outcomes we didn’t expect, didn’t like, or didn’t succeed to the levels of our satisfaction, “wrong.”

At least I do. I’m sure you have too. We are all human after all.

But that negative narrative only takes you to one place: shame.

I have watched others (and myself) become paralyzed in fear due to decisions in our businesses and life standing before us. Or destroy ourselves with shame while we tear apart our past, hunting for blame that we ultimately rest on our own shoulders.

To what end my friends?

In the game of business, decisions are our at bat. Each choice another swing. Those most successful are the ones taking the most swings.

Practice makes perfect.

And the more perfect the swing, the bigger the game. The further the fence. The more fans. The more success.

But it doesn’t happen for those sitting on the bench.

And it certainly doesn’t happen for those pining away about that time they struck out in that one game way back when. Those who are frozen on the failures of the past. Unable to see the game ahead. No. It doesn’t happen for them.

I call on you my friends to dream big. Swing big. But if you don’t, at least get up and swing.

Make those decisions. Take the plunge. Remove right, wrong, fear, guilt, and shame from your inner dialogue. Take that soundtrack off repeat.

Choices are about outcomes. Seeing what is possible. Learning from them. And taking another swing aiming for an even bigger and better outcome.

Swing I say. Swing.

Until next time.