The Back-Office Playbook: High-Leverage Moves to Increase Take-Home Pay and Reclaim Your Time w/ Ran Harpaz

Most independent consultants, coaches, and fractional leaders focus on delivering great work -- but far fewer build the back-office systems that determine how much they actually keep and how much time they get back.

In this episode of The 7-Figure Playbook, SamLee (IndeCollective, Founder & CEO) sits down with Ran Harpaz (Lettuce, Founder & CEO) to break down the back-office playbook -- high-leverage moves you can make to increase take-home pay and reclaim real hours each week. Sam also shares what this has looked like in practice, including how the right setup has saved him roughly $40,000–$50,000 per year while eliminating admin work that never should have been on his calendar.

We cover:

• The structural shift (LLC → S-Corp) that can significantly reduce your tax burden
• How to pay yourself strategically (reasonable compensation + distributions) to stay compliant and keep more of what you earn
• The fastest way to clean up your finances and eliminate costly commingling
• A simple quarterly audit that helps you capture deductions and avoid surprises
• Why a Solo 401(k) is one of the highest-leverage tax strategies available to independents
• A smarter approach to healthcare that expands your options without adding complexity

Whether you’re just getting set up or already earning at a high level, this episode will give you a clear, practical playbook to run a cleaner, more profitable operation.

Ready to keep more of what you earn and take back your time? Let’s go!

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Transcript

Welcome And The Solo HQ

SPEAKER_01 0:00

All right. Welcome everybody to The Modern Independent, a podcast dedicated to inspiring, equipping, and empowering top independent professionals to supercharge their careers and build more balanced lives. As you probably already know, we have three flavors of the Modern Independent. And today you're joining us for an episode of the Seven Figure Playbook, a series where I, Sam Lee, the founder and CEO of Indie Collective, interview distinguished independent business builders, folks who are here to share with you the practical playbooks that have helped them to build more successful businesses so you don't have to trial and error with your valuable time. Today I'm genuinely excited to be joined by Ron Harpaz. Ron is a serial entrepreneur and the founder and CEO of Lettuce, a platform that allows top independent professionals to do more of the work they love while freeing them up from the administrative burden and back office of building businesses of one. Today, Ron and I are going to be digging into some of the highest leverage shifts that you can make this quarter to grow your income, your take-home pay, and your free time. And I'll say, spoiler alert, these high-leverage shifts are personally saving me about$40,000 to$50,000 a year on my taxes, while freeing me up from the administrative tasks that aren't a great use of my time. So with that, Ron, welcome to the Modern Independent. It's great to have you today. Thank you for having me, Sam. Really happy to be here. Awesome. My pleasure. Well, before we dig into those high-leverage shifts that I just referenced, let's start by having you share a bit about what you and the team at Lettuce are building and also why the world needs a quote unquote solo HQ.

SPEAKER_00 1:32

Thank you. That definitely something that motivates me and us every morning. So start with the very top line. Lettuce itself is an all-in-one platform, AI-powered, purpose built for solopreneurs. We started with tax and accounting, we then added healthcare, we're now adding retirement. What we said all along we're going to build is what's happening. And here is why I think this is important. We are living in an era that is really all about solopreneurs, independent workers, the rise of the profession. It has societal impact. It's a big deal. And we can talk about it a bit more later. What I was seeing when we started letters and still seeing with too many health of the people I meet is that there is a huge fragmentation of what's happening on the back office. People have to chase tax and legal and payroll and healthcare and accounting and just a lot of stuff. And they end up spending too much of their attention or the administrative burden rather than being in what we call the zone of genius. If you are amazing at what you do, and whether you are a consultant or a therapist or a vet or a realtor or an AI developer, that there is a zone of genius that is what you do great and where you add value to the universe. You should spend as much time as you can there. And therefore, Atlantis were building what we call the solo HQ, the headquarters, uh virtual headquarters for the solo uh to take away some of that admin burden and let them focus on what they do really, really well. And it's uh specifically designed for these uh high-earning perma solo uh independents uh who are totally professional, it's not a gig, they're not doing it in between other things. Uh that's their destination, they're awesome at it. We want to help. So to summarize, our mission is to really give every solo the systems, the protections, the advantages of the world's best companies. Yeah. So they can tap into the zonogenius and go as far as they can.

LLC Versus S Corp Basics

SPEAKER_01 4:14

Love that. And I'll say, you know, we we really share in that mission. We obviously come at it at a different, you know, using different tools and resources that Indie Collective provides. But, you know, two stats that really strike me and that kind of got me excited about building Indie Collective were one, that 60 million US adults today, 38% of the US workforce, are now building their own independent businesses, consulting, coaching, fractional, and other service-based businesses. And half of those people are in mid-late stages of career, right? 30 plus million adults, people who have a zone of genius that frankly they go independent to be able to lean into and hopefully thrive in. Um, but the unfortunate reality is this there was a recent report uh that Score published um through the US Small Business Administration, and they said that of those independent business builders, right, they are typically spending 40 or more percent of their time on non-revenue generating work, right? They're living 40 plus percent of the time outside of that zone of genius. And that's way too much, way too much of their time. So I I couldn't agree more, you know, having a solo HQ that that organizes, strategizes, delivers on the back office, so important, especially in this moment in the economy and and you know, the independent movement. Um, well, I'd love to make this super practical for our listeners. Uh, let's dig into some of those high-leverage shifts that they can be making this quarter to be saving on taxes, increasing take home pay, freeing up time, and also protecting themselves and their families. Um, and I'd love to start with what I like to call setting the table, which is about making sure you select as an independent practitioner the right entity structure and tax elections to maximize your independence. Um, and I'd love for you to maybe begin by helping us to break down two things. First, what's the difference between an LLC and an S-corp? And second, why do so many of those high-earning independents, the ones that you at Let us serve, the ones that frankly at Indie Collective we serve, why do they use what I call the one-two punch, which is combining an LLC and the S election to maximize tax savings and take-home pay?

SPEAKER_00 6:25

I love it when we get practical. Okay, let's make it real for people. So um, really important for folks to know um that there are two different aspects as they go and set the table, as you say. First of all, they need to have the right legal structure to make sure that they have protection for liability and the flexibility to run their business the right way. That's why you need the LLC. That is a legal structure that is intended to make sure that the business you run is separate from you as a person. There is a legal entity, it has a bunch of protections, it's very standardized, uh, comes with a set of compliance things you have to follow, and it protects you. There is a whole separate uh tax uh setup known as S-corp, uh Selection from the IRS rules that is uh about how your income is treated and happens uh at the next level uh separate from your legal structure of your LLC. So just to be clear, you need to have an LLC that protects you on the legal side. You should have an S-scorp to save you money and be tax efficient in certain situations that we're gonna talk about in a second. The uh the main reason for you to have an SCOP is because of tax efficiency. The IRS set that up many, many years ago with an intention to help uh small business owners, business of one, uh um be more efficient in growing their business. It's it's a uh government incentive uh program that already exists in the boop. You don't need anybody in Congress to do anything about it, it's there. Um and uh the mechanism is intended uh to make sure that uh the business pays you as the owner uh a reasonable compensation, uh reasonable salary to make sure that the business is legit and compliant and everything is uh is is right. And then everything on top of that reasonable salary is treated as uh owner distribution. Uh think of it like dividends that the business is giving you. It's a business of one, so everything is very um uh simplified, but that's the structure. Once you follow the rules on that structure, so you have your LLC, you made your rescope election, you have reasonable compensation, you have owner distribution, you end up with a different uh setup of self-employment taxes putting in your pockets often ten to twenty thousand dollars and uh not very rarely thirty, forty, fifty thousand dollars because of that setup, depending on your earning. Um and what's uh I think important about it is this is not a hack. This is not something that you should be worried about, losing sleep about. This was prescribed by the IRS with an intention to incentivize and motivate people to start and run businesses like that. So what we do at Lettuce is take all of that knowledge and fully automate it. So you as a person don't have to worry about it. But with or without Lettuce, that's the right thing to do when you're in that high-earning term-solo income level.

SPEAKER_01 9:51

Amazing. Super, super helpful. So, what I'm taking away from you just at the highest level is one that the LLC and the S-corp are not the same. They are different, and frankly, they build on one another. So the LLC is a legal structure, which is important to have. So you are protecting yourself as the solo practitioner and the assets that you have, separating them from your business. God forbid something goes awry. Things do go awry at times. Um, and second, the S-corp is something that builds on the LLC. So that is your foundation, and it allows you to kind of elect for a tax treatment with the IRS. Um, and you know, I won't I won't try to repeat all of the really good knowledge that you just gave us there. But in short, through that tax election, um, you're gonna be paying yourself reasonable compensation. You'll be paying taxes appropriately on that. And for high earners, um, you know, myself, our members, and many of our listeners, there's a good amount of money to be saved. I find many indie collective members save 15 to 20,000 or more on their taxes. As I said, I save$40,000 to$50,000 routinely on mine. I'm I'm curious, Ron, is there a threshold of income that you would say, gosh, making this S election is a no-brainer?

SPEAKER_00 11:09

Absolutely. So we we have a bunch of tax calculator um on our website, but I would say as a rule of thumb, um, you should think of this as approaching six figure is probably the threshold. So if you're making 70K, 80K, towards 100K a year, that probably starts making sense to run your business that way. The sweet spot is somewhere between 100k and 300k per year, which we see most of our customers um in that sweet spot. Um, there are all kinds of nuances. So it depends if you have a very profitable business versus if you have an e-commerce store and you're mostly moving, you know, items with very low margin. It also depends on the consistency of your income. We have some customers who have very seasonal income. So you should you should give it a little bit of thought and you should definitely use some of the calculators. But as you start seeing consistent income above 70, 80, towards 100k a year or more, it makes a lot of sense. Awesome.

Deductions That Actually Matter

SPEAKER_01 12:14

Yeah, so we're we're we're starting with kind of your incorporation, your tax selections, because you know, I very much agree with Ron that if you're making that right level of income and you're committed to this path, this is really a no-brainer. Um, I'm obviously not a tax professional. You should consult your own or work with a partner like Lettuce, but um, but that's something that I highly recommend to our members at Indy Collective. And as I said, I consistently see them um saving a great deal of money just as I have. Um, so that that I'd say is is our first most important shift. And it's a shift that when you have it managed properly by the right partner, frankly, is not going to create burden on you, but it will, frankly, allow you to keep your back office in order and save on your taxes. Um, you know, once that structure is optimized, what is that next big lever? I think, I think, Ron, the next one I'd love to dig into a bit are some of those high-leverage deductions that people need to be focused on making business deductions, as well as any that you say are commonly missed by independents who are new to the swim line and maybe aren't thinking about their businesses as they should.

SPEAKER_00 13:19

Yeah, absolutely. So, so first of all, as we said, um, once you are in this world of I'm running my business like a pro, I have the right legal structure, I have the escope election, I'm now running like a professional, I have the systems in place. You should start thinking about next level optimization. What I see a lot of people get wrong is falling into the trap of chasing deductions by spending money. So having yet another meal and uh you know, buying yet another computer monitor because it's deductible. And I think it's okay. Like if you need to have the meal because you're entertaining a client from out of town, by all means, go ahead and do it and it's an expense and everything's fine. But spending money to save money on taxes is not the most scalable strategy. What I want people to think about is what are the highest impact strategies that allows them to keep more money in their business without spending more. So um, one that is very commonly used is true vehicle expenses, right? If you are um driving for your business, you know, realtors is a great example. Um, this is a true business expense. You should either track mileage, there are actual expenses, a bunch of ways of doing that. Um one that's really important and quite a few people miss is business use of home. So if you have if you have a home office and it's dedicated for your business, then the actual space, including things like the part of your rent or your part of your mortgage uh interest, um, the cost of your internet connectivity, um, all of those things should be something that you can deduct against your business because that home office is part of how you make the business run. And then you start going into things that are a little bit more advanced. Um, definitely business travel should be top of mind if you do that. Um health insurance premiums are tax deductible depending on your setup. And then if you use professional services, contractors, etc., all of those should be tracked and managed correctly. Again, what I'm what I'm saying here is as you start running your business like a pro, trap these things because they are a part of managing a business. Now, uh people sometimes miss um more advanced strategies um just because it's hard to do. And that's where I recommending having systems in place so that you're not before you're not spending your nights and weekends on worksheets and you know files and and and tracking your numbers, but you actually have a system that says, okay, here is my home office, here are my expenses, everything is connected, it just works. Um even if it's you know partial. So your internet connectivity is both business and personal, can track it on a system, etc. Education expenses, coaching that is tied to your business. Um, you need to put together an accountable plan. All of those things are important to do. And again, having systems really.

SPEAKER_01 16:34

Yeah, absolutely. Um, yeah, I think a recurring theme that that we're probably going to touch on a couple of times in the conversation is the importance of both having systems as well as the right partners, um, so that you've got the tools as well as the right strategy, you know, marrying with those tools to help you to focus on the zone of genius and also do more of the work you love. Um, I'm I'm curious for those that are listening that say, gosh, I don't have the systems today, I don't have the partner today. What might be that litmus test or how would you recommend that they begin to audit their expenses this quarter so that they start unlocking some of the value in their own businesses?

SPEAKER_00 17:14

Yeah, absolutely. Staying practical, I think it's really important that we give people things that they can do tomorrow. So um start with an audit of your expenses by sorting them from largest to smallest and definitely look at things that are recurring, right? So, as I said before, don't worry about that extra meal. Um, sure, it's adaptable, but it's not gonna change your business. Start with things like your home office, um, you know, travel, if you have subscriptions, um, contractors in your business. Start sorting them by the value and make sure that they are all um um tracked and written down. And then make sure that you put business expenses on your business and not on your personal account. So, one of the first things we recommend customers do as soon as they realize they want to have a business like a pro, make sure you have a business bank account, make sure that you have a business debit card or credit card of your choice. Get all of your business expenses to one on the business. It's the proper thing to do, it's one of the worst things to not do and get you in trouble with the IRS during audits when you move money between personal and business and it's all commingled, it's very hard to say what's the business and what's not. And then turn all of these things into habits. So even if you don't have a system tomorrow morning, start making a habit of saying, okay, I just paid for my um, you know, we work uh monthly subscription. Let's make sure that it's on the business account and it's tracked. Um, I just had my upgraded my starting so that I have redundancy in my office and I always have internet connection on the business account, tracked, everything else. And then as these become standardized and into habits, you can go into the higher order strategies.

Retirement As A Tax Strategy

SPEAKER_01 19:10

Amazing. Well, I'd say whether whether you're new to the independent swim lane or you've been doing this work for years, there's there's two takeaways that that I love, Ron, that you just shared that I'll I'll repeat back. The first is just around strategy. You started by saying, you know, um, spending money to save money isn't your highest impact strategy. And whoa, I could not, I could not agree more. Um, and I think I find many, many, many independents when they come to year end, they see that they're maybe ahead of pace for for their full year earnings or looking for ways to spend money as opposed to being strategic and finding those reoccurring expenses and frankly just setting the table right from square one. So that one is a huge one. Um, don't be spending money to save money. Um, set yourself up with the right strategies from the jump. Uh, and the second is the setup. And this is a basic one that I see many people miss. And it's that they blend their personal and business finances, um, which frankly makes a whole lot of confusion when tax season comes around and also really opens you up, I find, to risk with the IRS. God forbid you are audited because you're gonna have a lot of unraveling to do. And, you know, you don't want to be caught in that situation. God forbid that time comes for you. So, so really great takeaways uh for our listeners there. Um, I'd love to switch gears now and talk a bit about retirement because I think a lot of people view this as future planning, not as a real current lever for saving on taxes. Um, and I'll say in my experience, I find most independents default to the SEP IRA, but once you've elected as that S-corp status, uh, there's actually a more powerful option for these high earners. So I'd love for you to just unpack what that option looks like and how people should be thinking about it.

SPEAKER_00 20:53

Oh, absolutely. I love this one because I think it's one of the best examples of where planning and strategy come together to not just um save you money now, but really change your complete outlook of the future. And we we know how complicated the retirement situation is in America, and I'm pretty sure that everybody who's on their own as independent knows how uh heavy the responsibility is to decide how do I make all of this future planning happen together with the day-to-day need to run my business and keep profit. So, one of the most important things here is to pause for a second and think about what you want to achieve in the long term, when would you want to retire, in which way you want to retire. But then immediately after that, don't stop and get overwhelmed because there are things you can do tomorrow to get started, even if you don't have hundreds of thousands of dollars to put aside into retirement. And here is an interesting unlock. You mentioned SEP IRA that a lot of people are using because it's very simple to set up, but it's Has a bunch of limitations. The biggest deal that we recommend for people is once you have an S-corp, you are now both the employer and the employee of the business, and you can therefore have a solo 401k that basically matches you with the best of the corporations. You can now set up a plan that has employer contribution and employee contribution and unlock uh very high uh contribution limits, I think up to$74,000 this year and constantly going up, um that is only possible because of this setup. And that means that, first of all, there is an immediate tax impact because dollars that you move from your gross income into retirement are not taxed at that moment, then you also accumulate wealth in your retirement account to your ultimate retirement. And by setting it up this way with a 401k, you can have significant flexibility in how you actually allocate that money. Um pre-tax, post-tax, growth, regular, you can have traditional investments, you can have alternative investments. Um this is an area that has incredible richness. So one of the reasons we made the recent move to bring uh carry 401k retirement into the lettuce uh solo HQ is because we believe that retirement is such a major component. And we want to make you able to start with a click. Later on, you can develop your strategy and increase how much you put in and get more sophisticated with alternative investments. That is all possible, but you should be able to get started again tomorrow. Let's be practical, don't delay this. It's something that you should do, even if it's a smaller amount.

SPEAKER_01 24:05

Amazing. I mean, we we could probably do an entire podcast episode just on this one topic of retirement, because it's, I find like healthcare, which we'll talk about next, is one of those hairy ones that that people feel, gosh, I can't leave my employer uh because I won't have that set up for the future. Um, but truly, if you know the right strategic moves, you have the strategy and you have the right tools around you, you can frankly make as strong a retirement um, you know, plan on your own. I'm curious, you know, within this universe of retirement, is there, you know, one aha that you want our listeners to have so they're focused on the most important shift there.

SPEAKER_00 24:44

Yeah. It's good that you call it out. I think it's really important for people to take away that retirement is a tax strategy, not just moving money from one pocket to another. You're not just moving money from your checking account to your saving account. It's a whole way to unlock a high-caliber, high-impact tax strategy and take care of your future. So you're saving money today and building worth for tomorrow. And this compounds to tens of thousands a year, hundreds of thousands very quickly, and then millions in retirement. Um, it's a big takeaway. Everybody should think about it at least for a minute.

Healthcare Anxiety And Better Options

SPEAKER_01 25:28

Great. And you're gonna see, folks, like we're talking today, and I talk a lot about this when we're building better businesses through Indie Collective. There's an order of operations you want to do these things, right? A go, no-go framework. Does this make sense for me given where I am with my business, given my ambitions as a business builder? And if the answer is yes, it's a go, there's an order of operations in which you want to make these strategic shifts so that they compound and you're able to get the most leverage in your system. Um, you know, you know, these these particular retirement recommendations, right, they build on the momentum of having the S-election, of, of being the employer and the employee. Um, so so keep these in mind as you're thinking about what's right for you and also how you set yourself up holistically with the right strategies and and the right kit for your business. Um, last topic I want to get into is another hairy one for many, especially those that are just embarking on the independent path, and it's healthcare. I find it to be stressful and confusing for so many. Um, and that's because the landscape is changing quickly. I'd say, particularly in the US at the moment. I'd love if you can give us a quick snapshot both of what's happening in the environment and also what independence need to be thinking about when it comes to making sure they have the right protection for themselves and their families today.

SPEAKER_00 26:45

Yeah, this one is very important and, you know, to be frank, quite difficult for some people to deal with. Uh as we all know in the US today, the healthcare system is complicated to understand, expensive to deal with, and also attached to a lot of emotions. Like when you need it, you're typically in a pickle, and the the last thing you want to worry about is, oh my God, I don't have coverage. So um unfortunately, the current situation is that the market is very fragmented, it's very hard to know what's right. If you don't have a large corporate employer with employer-sponsored benefit, you find it very hard to shop for solutions. You know, many states have all kinds of websites they put together to try and find the place. And the government has been trying to put things in place and it's almost there, but but how to deal with? And then people end up making a ton of really hard trade-offs, um, all the way from staying at an employer that they don't love because they are really afraid of being out there on their own, um, being dependent on somebody else, a spouse or a family member, um, again, in a relationship that might have strain uh because of the cost of healthcare. And people are making choices um about cost versus coverage that uh, to be honest, are not always fully informed and not always the best possible ones. Um, people really worry about this. So I am deeply concerned about independence as it comes to healthcare, and therefore Lairdus is taking upon itself to really change the industry in this, and I want to talk about it in a second, um because the the risk is too high to leave people to actually shop around on their own and hope for the best. That specific area is really about your health, it's about your well-being, and we need to step up every one of us, lettuce specifically, but every one of us, and help independents make the right choices. So I feel very strongly that we have a responsibility here and uh, you know, we'd love would love to tell you a bit more about that.

SPEAKER_01 29:06

Yeah, please. Well, let's let's let's dig into that. I'd love to hear kind of how Lettuce is trying to solve this problem for independence.

SPEAKER_00 29:12

Yeah. So what we've identified is, you know, just shopping around for plans is probably not something we want our independents to do on their own. So we decided to step up and create our own PEO, professional employment organization, um, where we take responsibility for grouping independents together and buying coverage as a group for independence. It's part of our bigger vision of that, you know, solo headquarters, solo HQ, of a full stack of support for independence. It's a major move because, as you can imagine, it requires regulatory compliance, registration with every single state. There are significant um um requirements to set it up. But we are doing all of that as letters so that our members can have access to benefits, including healthcare, in a way that they wouldn't be able to do otherwise. Um, I'm not an insurance broker, I'm not here to sell insurance or healthcare or anything else, but I do want people to understand that the concept of having a group benefit coverage unlocks significantly better benefits than if you go shop on your own. Think about it when you work for Google or Meta or any of these big brands, um, they have the purchasing power to go get group benefits that employees are enjoying under that umbrella. We are doing the same thing, saying we create that grouping mechanism so that our members can get a solution that has all of those benefits. I encourage you to learn more about it. You may choose to go with lettuce, you may choose to go on your own, but please be informed. This is an area of importance for your well-being, for your family. Take a moment and learn about it.

Building With Fractional Leaders

SPEAKER_01 31:06

Amazing. Well, I'll say, you know, our Indy collective members have been fortunate to kind of get to work now for some time with Brad Matthews from the Lettuce team. And he kind of in our 10-week boot camp teaches people how they can be making the right, you know, basically the table setting from the corporation, the tax selection, the deduction decisions. So they've got the strategies that are highest leverage in place. And then obviously, Lettuce frankly works with many of our members to help them to actually manage those strategies so they're not having to be burdened by the administration. Um, and I'm so glad to hear, frankly, you all are taking, taking lead and taking charge as it relates to building that PEO for the independent workforce because it's definitely needed. Um, you know, what I what I share with people personally when I hear them, you know, exploring independence and flagging healthcare as a big concern is this. One, you know, that's not really your concern. I find in most cases, people fear whether they can translate years or decades of experience into expertise that they can market, sell, deliver on their own, right? That's the real concern. Can I replace my income? Can I double? Can I triple my income? Is it possible for me, like I've seen others do? I think that's the real concern. Because if you can do that, guess what? Paying for your healthcare, even if it's at a premium, will work, right? And it'll be a pennies on the dollar of what you can be making as a high-leverage, high-earning, independent professional who's doing business in life on their own terms. So that's that's the first thing I always share. And the second thing is find the right partner, right? And and I'm so glad to hear you guys are going to be playing that role of PEO for the space because again, when you work with a PEO, whether it's because you have an employer or now you've got a partner of your own as an independent, you're generally able to access, you know, the best premiums and get the best care and kind of get the best of both worlds. So that's that's awesome to hear. Um, okay, folks, we've now covered uh four high-leverage shifts, just to recap those. Uh, we started with business setup, right? Getting incorporated, making the right tax elections. We got into those high-leverage deductions that can save you a bunch of money by just doing, frankly, making deductions that you're already kind of doing for your business. Talked a bit about retirement uh as well as now just healthcare. Um, I'd like to round us out now, Ron, um, with a different direction. And I'd like to talk a little bit uh about how you're building Lettuce. Um, and specifically the fact that over these first few years of building Lettuce, you've frankly built a team of fractional leaders as opposed to hiring a bunch of full-time employees. So I'd love to hear a little bit more about why you chose that path and and how that's working out for you now a couple of years in.

SPEAKER_00 33:50

Yeah, I love this topic because it it allows all of us to really um do what we preach. And and I'll tell you a little bit about it. Um I'm very proud of the fact that most of the folks who work at Letters are fractional and fractional by choice, fractional because that's what they want to do. Um, typically, these are very senior people who've done really well in their career and decided at some point that they want to work for themselves. Very um consistent with what you're describing about uh our audience. Um these are folks who are able to do phenomenally well in whatever environment they choose, and and they choose to be uh independents. And when I uh uh started Litus, I wanted to be able to tap into that kind of talent, have the flexibility of scaling the business up whenever needed, um, while being capitally efficient and uh do all of this at startup speed. Now, all of these together are hard to do. And and you know, traditionally you post a position and you start hiring and you hope for a great fit and it takes time to train because not everybody that you find is you know ready for the job, etc. By accessing fractional talent, I'm able to say, I have this need. Right now it may only be 10 hours a week because we are starting something. Maybe I need an um AI SEO expert. Maybe I need somebody that can build a specific technical capability. I'm not ready to hire a full-time person. I need a niche expert. I go find that expert, bring them in as fractional, get a lot of leverage. They enjoy what they do with letters, they come back and ask for more, and then it grows into hey, why don't you spend 20 hours a week? Why don't you spend 25 hours a week? Amazing. And some of those folks end up saying, you know what? This is my destination. I love it here. I want to stay. We're able to set them up with all kinds of compensation structure, access to equity, etc. It's been phenomenal to see a company that is built by solos for solos. It allows us, like we need, like to say, to eat our own dog food, we use our own product, we drink our own champagne. Um, it created a team that really knows what our customers are all about, because that's us. We're not talking about some random, you know, virtual user. We are a customer, and and the team is phenomenal. You you had a chance to meet a few of them. I love it every single morning.

SPEAKER_01 36:34

Amazing. And I'm curious, now that you're years into building Lettuce, you've fundraised more than once, you've acquired a few companies, has that strategy evolved? Are you still kind of starting fractional and building from there? Or have you kind of departed from that over the years?

SPEAKER_00 36:48

So we we are hybrid, we are flexible about it. So there are roles and functions where it's very clear that with a full-time person, it's an engineer, they're gonna have a lot to do. We have a roadmap two years into the future. We go hire somebody, they get the job, they they they join the team, everybody's happy. But we are also constantly on the lookout for unique talent that can give us that extra bum, extra in that may not be a full-time job yet. Right? When we, for example, decided to go into specific verticals, uh, we wanted to have an expert with therapists, and an expert with realtor, and an expert with AI consultants. And I don't have a full-time job spec for those, so we keep looking for fractional talent and they keep keep growing with that. Um, we always look for people who have a sense of ownership, who care about what we do here. Again, this is not a gig. These are senior folks who have built companies before and have been very successful and choose this path because it maximizes what they want to do in a domain they care about. I highly recommend this for everyone that I know, startups, large corporations, anybody I talk to.

Quarterly Checklist And Resources

SPEAKER_01 38:06

Amazing. Well, you're you're definitely still ahead of the curve. I think it's frequent now that high-growth startups, particularly ones that are early stages, are looking to kind of hire fractional leaders because they can access further ahead talent that can help them to build from having seen the full movie, if you will. But I think it's still unusual that there's leadership teams that are composed of multiple fractionals or a majority of fractionals. I think that is increasingly the future of work, the future of building business. Um, frankly, I'm I'm a little suspect of companies that are serving our industry that are not doing this, right? We need to be eating the dog food in order to produce the types of strategies and results and platforms that that our independent workforce needs. So I really appreciate that you guys are taking that uh and living living into that value. Um, well, Ron, this has been such an uh such such a fantastic podcast. I appreciate you taking the time. Um, as we wrap up here, I'm curious, are there you know one or two high-leverage things that you want to leave um our listeners with so they really get focused in these next couple months of the quarter?

SPEAKER_00 39:09

Yeah, absolutely. The theme uh that we started with of being practical, I would say you are the asset, you are the talent. So make sure that you think about how to get the most of your talent. The first thing to do is evaluate whether you're in the sweet spot for escope eligibility. If you are, go ahead and do that right away. It's the right thing to do. Then um make sure that you audit your current setup, that you have a bit of bank account, that you have the right legal structure. Um, look at your deduction and expenses. Make sure that you think of your business and run your business like a pro. Once you've done those high-leverage items, um figure out if you can stop running your back office. Figure out if you can have a system, a partner to take off your plate the bookkeeping, the tax, the accounting, how you run everything that needs to happen so that you can, you know, focus on building your business. And then advanced strategies like healthcare and retirement, et cetera, they would all fall into place once you have that right setup. So start with a setup, get a good partner, treat your business like a pro. You're gonna be really successful.

SPEAKER_01 40:30

Amazing. Well, that that's a perfect, perfect note on which to wrap up here. Uh, folks, you'll you'll find more about Lettuce in our show notes, but but check them out at lettuce.co. Um, they've got great resources on their website, including that tax calculator that will help you to determine if it's a go or no-go for you today or in the future to make that S election. Um, and frankly, I'll say from a place of having been there and done that, I'd highly encourage you to check out Lettuce at their solo summit. I've been a speaker, I've been a participant. I'm always there because I always learn with them. Um, so check them out. Um, they they lead it multiple times a year, and it's well worth your time. So, Ron, thank you so much. Uh, and I look forward to continuing our conversation very soon.

SPEAKER_00 41:12

Thank you, Sam. It's been delightful. Really appreciate you. Of course.