I'm going
to tell you guys the honest truth about starting
and scaling a $3 billion company. So I started just climb, managing
a 60 unit apartment building in downtown Seattle, where my compensation was $600
a month and a one bedroom apartment. What I learned at that
very basic job was how to run an apartment building, how to operate it,
lost people, how to buy them. And most people know how to raise capital
like Wall Street. But hardly anybody knows how to run up. And that actually
is the key to the entire business. So that first job in property management
actually gave me the courage and the wisdom and a little bit
of experience to be able to scale my company and buy more real estate, because all fundamentals
start with the basics of collecting rent or income through sales and paying expenses,
and having money left over at the end. The basis of any business starts
with the act of managing the business itself,
and the case of the 60 unit building that was collecting threads
from the people that lived there and paying all the expenses
like property taxes, insurance, utilities and all those saying with the anticipation
of having cash flow at the end and all businesses
have the exact same model. So once I learned that synchrony
had realized that I needed to be on the other side of the desk,
not just the property manager, that's how I had to learn how to buy properties
and find brokers to find those properties. Then I had to learn on how to obtain loans
for those properties. And then, of course, more importantly,
how to raise the equity. Because I didn't have that money. Just like a lot of you,
you never start with money. You start with an idea. You always start with
something that nobody else can see. And then you go raise capital around it. But you better damn well
make sure that if you do get that money that you can perform. So that's why I started with one property
and I bought one property based on that exact same model. Then of course, you're like,
okay, that work, I want to buy more. So then I started to buy more
and that's what I realized. I didn't know how to run a company. I knew how to buy real estate,
but I didn't build a company. And that became the next obstacle
to learn. And from there, I got into lots of groups
like entrepreneurs Organization and Ypo are young friends
of this organization. I started to seek out mentors and coaches that could help me run my business
and then scale my business. One of the biggest lesson was to have
a one year, three year, five year, and a ten year plan, and then to hire
the right people to execute that plan. The honest truth
about running a big company is that there's a fair amount of stress
and anxiety and pressure around making payroll on time, around
losing big clients, around not hitting your monthly goals
or your annual goals, even an absolute because a lot of your employees
are trusting that you can pull it off. They're trusting that they can get paid,
and they're trusting that hopefully there's even bonuses at the end
of the year if the company does well. So there's a tremendous amount of pressure
and the album perform can assure you
that it is not a straight line. And it never happens the way
that you think it's going to happen. It's literally a series of fire
fighting and scrapping it out for all the income, more sales
that you've got coming in, and it's constantly
managing the expense side while trying to keep the culture
as high as possible and the vision for everybody,
because the founders have to set the vision for the company
and they have to have the right messaging so that everybody is behind the vision
so that everybody's working together. By far, the biggest messed up
I've ever had is hiring the right people. So a long time ago, I realized that
if you hire out of attitude and not on experience,
because in the beginning I always thought, oh, this person has a lot of experience
and you bring a lot into the right role. There weren't always necessarily leaders,
and a lot of times there was friction and turmoil
with the employees that worked for them. So I've always found that I'd rather have
somebody that's really eager and always willing to learn,
because they'll always come to you whenever a job starts and say,
I need more stuff. I'm done with that. What can I learn now? So you want that person that's
always going to have the best attitude because they're going to grow the fastest. So the biggest lesson
by far is the hire on attitude and not necessarily always on experience. So one of the things that's important was
growing and businesses company culture, because oftentimes
the founders are always out trying to scale and buy new businesses
and grow and get new accounts. And they're always selling and they're
always trying to bring more money in. But what happens is that the employees
that are actually working for you, they can approach burnout. So it's really important
that you're always staying connected with all the folks that are actually
moving the needle for you, and that can happen. You're going to find all the different
personalities that work for you. Some of them are lazy,
some of them are workaholics. Some will listen,
some will listen too much. Some of them can't make decisions. Some will make too many decisions. So you've
now become more of a psychologist, and you have to feel
the pulse of the company because everybody's
going through something all the time. Sometimes they're on PiS
and sometimes employees can be on lows, typically has very little
to do with the work itself. Almost always it has to do with friends, family or health or something
outside of the company. So you have to stay rooted
and have empathy for those people. And be present with all of them
and make sure that the company culture is strong. Because they come to work
for what the company represents, but they also come to work
because they want to feel needed. They want to feel respected. And as the founder,
you have to stay connected with all of that as you're
continuing to grow your business. And once you get that corporate culture,
what happens is if somebody comes
in, that's not good for the culture. The culture actually kicks
that person out. The founder rarely has to step in
and do that for itself. So once you build that culture
and it's strong and everybody believes in the direction
and the vision of where it's heading, then when somebody comes in, that's not a line
they get kicked out on their own without the founder
even happened to do anything. The way to do that,
of course, is to stay connected and have touchpoints with everybody during the day, during the week,
during the month and every quarter. So we do things like state of the company
meetings, where we have everybody zoom
in. As an example. We have newsletters
if you guys have ever seen or read the book The Boys in the boat, it's
very similar to that. There's eight there's an eight man
crew in a boat with a coxswain at the end. There is a place for the coxswain
and the first in the front, the first in the back. They all have a specific duty,
as do the people in the middle. And the coxswain is the yelling,
and the coxswain is yelling and telling everybody what speed. And they're watching everything
and they're saying, okay, we're behind here, we're behind there.
We need to step it up. And each person in that boat has a role. So that's the goal of a CEO. The goal of CEO is to find the right
people, stick them on the bus and make sure
the busses go in the right direction. And then eventually caught them
in the right seats, because sometimes the employee doesn't even know what seat
they're supposed to be in. Maybe they think that
they're really good at marketing, but you find later
that they're actually better suited in a different role,
and you have to figure that out for them. Then they'll start to flourish
in that role. Sometimes it's simply
just being aware of the individual and trying them out like you would
in any kind of sports team, for example. The hardest part by far,
and being in my position is you continually get sucked
into the operations of the company itself, because there's so many things going on
and so many needs. And I'm not saying that you shouldn't
be involved in those things. You're always balancing
the time of what you're working on the business
versus working in the business. And so a lot of times,
especially small businesses get caught up in working in the business and they don't have any time
to work on the business. So it's very hard to grow
unless you're working on the business. So in a perfect world,
you should be spending 70, 80 and 90% time working on your business
and 10% in the business. And when you do that,
then of course, you can scale much easier. So Ross and I have hit most of our goals
in our 24 years of business. First it was 2000 units. Then it was around 4000 units,
and then it was all in 10,000 units. And we passed all of those goals. And so now the next goal is 25,000 units. And that's the next ten year goal. And we'll definitely hit that. The beauty of that goal like that out in front of you,
everyone can work toward that goal. Really good people resonate
with that kind of a goal because they see progression in a company. A lot of times if you think about really,
really good people, people that are at the top of their game,
they want to be in an environment that you're continually moving forward
and growing because they're going to have tremendous opportunities
to grow inside of that company. It's very hard for a company
that's stagnant for the last ten years to be able to attract
really good new talent. They might be able to find employees,
of course, who had lost, but most of those folks are just going
to be looking for a safe, secure job. This is a full time thing. This is not a side hustle. This is not something you can do
and take your eye off the ball. Now you can at some point create
other verticals inside of there,
but you have to be all in. You will never get the respect
from the employees or people that are aligned with you, unless you're
all in a business and really help it and grow toward the goals
that everyone has said. You cannot do this part time. And I've made countless mistakes of the
past 30 years of running this business, and part of my goal is to tell the community on how
they can shortcut some of my mistakes, so they can be in better position
to be faster than even I was. And you could learn from my own mistakes. So I just made a video
on the most important mistakes that I promise
you you're not going to want to make. All right.
I highly recommend checking down out here.
