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The Ground Game Podcast
Welcome to The Ground Game Podcast, where land investing meets real talk! Join your hosts, Justin and Clay, both 7-figure land investors and seasoned entrepreneurs, as they dive deep into the world of land investing, team building, and personal growth.
The Ground Game Podcast
Episode 34: Why You’re Going to Go Out of Business
🎙️ Welcome Back to The Ground Game Podcast! 🎙️
In this episode, hosts Clay Hepler and Justin Piche discuss the critical factors that can lead to business failure in the real estate and land investing sectors. They share personal experiences and insights on navigating challenges, emphasizing the importance of strategic thinking and resilience.
Key Highlights
Personal Updates:
Clay shares his recent experience at a development meeting that didn’t go well, highlighting the difficulties of navigating local zoning regulations. Justin reflects on his own challenges with deals that didn’t pan out, underscoring the importance of learning from setbacks.
Understanding Bottlenecks:
The hosts delve into the significance of identifying and addressing bottlenecks in business operations. Clay recounts his struggles with unsuccessful mail campaigns, illustrating the need to focus on core issues to drive meaningful results.
The Power of Strategic Thinking:
Clay and Justin emphasize the importance of strategic thinking in land investing. They discuss how Clay shifted his focus from flipping houses to land, detailing the mindset changes that contributed to his success.
Hiring for Success:
They explore the common mistake of hiring based solely on cost rather than potential impact. Clay shares his experience of hiring skilled team members, stressing the value of investing in talent that can drive business growth.
Flexibility in Business:
The episode covers the importance of having flexibility in your business model. Justin discusses how relying solely on double closes can create challenges during market fluctuations, emphasizing the need for diverse transaction strategies.
Building a Consistent Business:
Clay and Justin stress the need to build a business focused on consistency and volume rather than one-off deals. They share insights on how perseverance and strategic decisions can create a sustainable operation.
Leadership and Team Empowerment:
The hosts discuss the importance of strong leadership skills and empowering employees to solve core problems. They highlight how effective leadership can reduce turnover and foster a positive work environment.
This episode is packed with practical advice, personal anecdotes, and actionable insights that can help you avoid common pitfalls in
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Justin Piche (00:00)
Welcome to the Ground Game Podcast. This is your co-host, Justin Piche.
Clayton Hepler (00:05)
And this is your other co-host, Clay Hepler, and we are here to show you how to win the ground game.
Justin Piche (00:24)
What's up, Clay?
Clayton Hepler (00:27)
Well, I just got back from a development meeting yesterday and it was not good. It was not good. Yeah. Yeah. Well, got my clock cleaned a little bit ⁓ on a rezoning request. The county that ⁓ I was at ⁓ is not very open to rezoning of parcels because it's primarily agricultural land, even though we have, we're, we're, seeking a designation from
Justin Piche (00:33)
⁓ dude, what happened?
Clayton Hepler (00:56)
or agricultural to residential. That's a hard transition. know, that's like going from a horse drawn buggy to a car. And you know, I respect the, I respect the local community. You know, they're looking to maintain the community and there's also the importance of housing in the area. And so it was, not going to go into specifics here, but it was, it was, ⁓ you know, ⁓ I came,
Justin Piche (01:02)
Yeah.
Not good.
Clayton Hepler (01:25)
Yeah, I was greeted by couple of cannons and I came with flowers.
Justin Piche (01:33)
Maybe you should have come with a shield. No, yeah, that sucks. It's tough, man. It's tough. I recently I mean, I look at a ton of deals. I know we both do and I I do a lot of deals. But but the reason I do a lot of deals is because I look at a ton of deals. And recently, I've had several developments that I've either invested a lot of time in or a lot of money, you know, not pan out and and
So my team is still sending me deals. We're looking at them and I had my project manager literally just the other day. She sent me a deal in a county that I have worked in before and I've gotten a major development approved in. It was a rural kind of split, but it was still a full major engineering, detention, road studies, driveway locations, perfectly selected based on how fast cars go by and how the road curves and all this different stuff. And this is in the same county. She sent it to me. I was like, I think we can get more money, know, boss, if we do.
this major development style and put like 20 lots in. And I just looked at it. I was like, underwrite it for a four lot split, all road frontage. I do not want to mess with that. I do not want to mess with that because multiple times over the last month, probably four different deals that I've started going to, know, vetted engineering companies, gotten a site plan together, started to do the due diligence on or done the due diligence on infrastructure. And then it's like, okay, well now the deal is dead.
deals that because the costs to do this or that are way too high.
Clayton Hepler (03:02)
Or you have an environment that is locally that's against development and that...
Justin Piche (03:09)
And that's the other
thing zoning changes like I don't even I really don't play in that area right now. If it's not by right already like the lot is designated for the density or for the end use type that I am trying to do. There's too many it makes me too uncomfortable because not only do you have to get the end engineering and result of what you want to do done. You also have to get the property rezone and there's multiple places at which
the neighborhood, the neighbors, people can put a kibosh on that. And it's just a lot of risk for how much money, you know.
Clayton Hepler (03:46)
Yeah, and so, you know, it's interesting. I was driving back, because I had to drive six hours to this location, six hours back. It didn't make sense to take a plane. ⁓ And, you know, there is a, I talked to my salespeople and say, hey, you know, there's a study by Harvard University. ⁓ It might be Harvard, it might be some other university, who knows? It's kind of like attributing every quote to Winston Churchill or Einstein.
that found that salespeople who do an after action review have a 66 % chance, higher chance of hitting their targets. And so I tell my salespeople, lead managers, acquisition managers, when you get off that call, you want to say what went well, what didn't go well, and how did I contribute to the outcome of the call? Now think I originally heard this from maybe Steve Trang. I might have heard it from Steve Trang, who's a sales trainer, real estate disruptors.
Justin Piche (04:25)
you
The real estate disruptors. I remember hearing him a lot
back like a bigger pockets time and then I listened to his podcast for a little while
Clayton Hepler (04:42)
Yeah. Yeah. Yeah.
Yeah. I mean, he's a tremendous sales trainer in general. And I think I might've learned it from him. don't know though. But when I was coming home from this, I was driving home and I was thinking it through. I was like, you know, what went well, what didn't go well. I learned a lot here, but again, ⁓ you know, there's a huge 500 acre trust, family trust that hired an attorney attorney showed up to this meeting, you know, so it wasn't like, you know,
rezoning as you say, it's like you kind of learn these things and it's like great, I learned this thing. ⁓ But you know, when you go up against something like that, you can choose to push Justin, you can kind of flow. And I saw that and I said, I don't know if that's the type of business that I want to get into. Right. So, you know, ⁓ I think it kind of brings it into what we're what we're going to talk about today, which is, you know,
Justin Piche (05:29)
Yeah.
Clayton Hepler (05:39)
What's going to prevent your from lasting, right? What are the key things that actually, you know, I hear every day, you know, with private clients in general, we're always thinking, you know, how do I improve the business? How do I keep going? But there's not a lot of people that talk about lasting. think Steve Jobs had a quote that was something along the lines of like, you know, the most important, one of the most important things in business is, is having enough resources. This is totally paraphrasing.
to sustain, last. That is actually a competitive advantage. That's a competitive advantage. ⁓ And so, you know, we're gonna talk about that today. I think it's a relevant topic because it's just not discussed. It's like, let's scale. But a lot of times, scaling is about surviving.
Justin Piche (06:14)
Yeah.
Yeah, I mean, I agree completely. I mean, how many stories do you know of folks that have been in this business and then kind of fallen out of it for various reasons? And there's a lot of reasons why, you know, that that people do. I think that's what we're going to get into. know, one of my one of my best friends, his dad started a company ⁓ where they essentially underwrite large construction firms on their ability to complete projects and they bond. sell bonds.
basically to these companies so that they can get these huge construction projects. guys who are building or guys that run construction projects, et cetera, a lot of times they definitely know how to do the work. They've got the crews, but the way some of these contracts are structured are such that the construction company has to front or pay for a ton of the material ahead of time.
And then maybe they have like a 45 day or 90 day or these payment, repayment milestones where they don't get reimbursed for some long period of time. And so in order to get these projects, in order to actually get accepted for these projects, these companies need to get essentially an insurance policy that says, yes, they have the capital. They have what they need to actually complete this project. Even if they're huge, even if they have a ton of resources, they still need to get these bonds that prove to the company who's awarding the bid or the government agency or whoever it is that this company
won't run out of money in the middle of a project. And it kind of reminds me of this thing that we're talking about, which is, you how do you make sure you last? do you do that? How do you underwrite your own, your own business with a, with a bond or insurance policy to make sure that you can last through, through the ups and downs that we all see in this industry.
Clayton Hepler (08:08)
one of my favorite living entrepreneurs that I really look up to is the founder of Raising Canes, close to where you went to school, Louisiana State University. And he has a quote that when I heard it, I like, it almost changed my business completely. And it's
Justin Piche (08:18)
Yeah! yeah.
Clayton Hepler (08:32)
The most successful people I know stay in the details.
So when you lose control of your business, you lose control of your business. A lot of times for an immature entrepreneur, for me at least, like not to say I'm an immature entrepreneur, but we delegate so much of our day to day that we don't know the details. And
Justin Piche (08:56)
you
Clayton Hepler (09:06)
We can't, we are the founder, we solve the biggest problems in our businesses and we delegate so much away. And that's where I see a lot of people, man, they fizzle out. how do, what, you know, tactically, what creates that? There are a couple things, right? But the fundamental thing is boredom.
boredom because I don't want to do KPIs. One of things I talk about with my clients all the time is like, we start the calls with KPIs. Right, the most boring thing, eat the frog, right? Eat the frog first, right? The most boring thing is critical and people don't want to say in the details. They don't want to look at their P &L. They don't want to look at their KPIs. And for a high D personality, a very visionary type person, maybe that doesn't have an engineering mind like yourself, Justin, someone more like me,
For someone, again, who is a visionary, more sales kind of entrepreneur, I heard this quote, it hit me so hard. The reason we become entrepreneurs is because we're not good employees.
Justin Piche (10:10)
Hahaha!
Clayton Hepler (10:11)
Right, right, and so what, you know, good employees follow the task. was talking to one of my clients and, you know, I was talking about KPIs and I said that same exact quote and they're like, yeah, we know how to do the task but we just don't follow the SOPs. Because we're talking about building out their whole process, SOPs, et cetera. They just don't do it, right? So that starts in boredom. And how it manifests, man, is people go after shiny objects. They hear the newest, greatest thing.
some marketers talking about distress acquisition, ⁓ some person's talking about flipping houses, some person's talking about this, subdivides, instead of just getting your business and getting it to the next level. Getting two or three or four more deals per month is a way that you sustain versus losing yourself in the details, getting bored, and succumbing to shiny object syndrome. That was the first thing to me that was like,
clearly this is what stops people. This is what prevents them from sustaining and building a business that the last years.
Justin Piche (11:16)
Yeah, I mean, I agree with everything you just said. I think there's a couple of like big things that will hurt people and put them out of business. But boredom is definitely one of them. ⁓ I think shiny object syndrome just to kind of hone in on that, you know, building a piece of your business that you're not ready for and allocating too many resources to it, neglecting the core business. I feel like that's probably the most common way that land investors
end up going out of business after they've established something. ⁓ It can hurt. mean, you know, we're talking about these development deals that have fallen out. I've been lucky to have pretty much all of them fall out really early in the process. So the amount of money that I've lost on them has been, you know, significant five, 10, 20 grand here and there, but not like death blow status. But if you get, you know, we're talking about, let's say it's a rezone. Let's say it's a rezone.
where in order to apply for the rezone permit, you have to have the end development like engineered, go through like kind of the preliminary plat and rezone at the same time. You're several hundred thousand dollars into engineering on a deal. And because the deal is so, has such a high risk of failing, you probably weren't able to raise and you just went all in, you bet on yourself and then boom, it doesn't get approved for some reason or another, or boom, you can't find the builder for it.
You've already invested all this money in engineering and your contract expires or you can't you can't execute on your contract on the deal. Those are the big items that will put people put people out.
Clayton Hepler (12:55)
Yeah, yeah, I, and like you said, a lot of times it happens because of the shiny object. You know, the biggest, the biggest problem to solve, the biggest opportunity is inside the business, not outside. And you know, the listeners are listening to this with you, Justin, Clay, like these guys know what they're talking about. No, like we struggle with this stuff, man. We struggle with this stuff. You know, we see more opportunities. I see more opportunities than I ever would. In fact, the other day I said, Justin, can't, I,
We were talking about an opportunity you and I are gonna work on and I said I can't do this because I have so many other things going on. Not that it's a shiny object, you know what I'm talking about, but there are other things that are more pressing that are more important for my business.
Justin Piche (13:42)
100%. Yeah. mean, this is such a common thing for, for I think any business owner is just to feel pulled in a lot of different directions. And the way that you keep operating long-term is you are just relentlessly focused on your goal and you don't let all the distractions of all the other things you could work on distract you. Now there's, there's a place for people to spin up businesses and you know, they're, they're like, there's, it's a rare skillset.
where you're just like a, you're like a builder, starter, a builder, and you never ever, you never transitioned into a manager operator. I don't think that really works in this industry. Maybe that works for kind of like a startup. You know, you can spin up some startup company, you get it off the ground, you get the investors in, you have the product idea, and then you sell it to somebody else who ends up being, or you hire your CEO or whatever, who is the operator, the manager of that, that company. But I don't think that really works very well in this kind of land investing land.
flipping type model. mean, I don't know. I don't know very many people who have sold land investing businesses. I mean, what do think a land investing business is worth? It's probably worth some discount to the asset value that you
Clayton Hepler (14:52)
Exactly, exactly. ⁓
Justin Piche (14:55)
There's nothing else to it. It's like you own a million dollars in assets that you have on your balance sheet that you're working to sell. That's what the property is worth. Maybe your business is worth 800K, something like that.
Clayton Hepler (15:05)
Yeah,
yeah. So, you know, if we're talking about shiny objects, we're talking about boring, you know, really those are kind of the key things like the boring got to be in the details. I'm sorry, it's prescribed like a doctor eating your vegetables, right? Eat your vegetables, land investors, eat them. One thing that I also see a lot of people do,
specifically in our business because of the elongated cash conversion cycles is over hiring. So if you stay small and nimble, says the guy with 20 employees, and you grow smart, you can really scale this business sustainably.
Justin Piche (15:41)
Hmm.
Clayton Hepler (15:56)
what is not often taught, and I think Justin and have done a really good job at explaining it, it's like, start small, scale smart. Start small, know your numbers, and then scale, right? And so, particularly as I talk about a lot, it's like the principal agent problem is very real in your business, and so the reason why you wanna scale smartly is because no one is going to work as hard as you do. You cannot delegate passion.
You cannot delegate the burning desire to make the business work. As soon as you start to try that, you scale in a way that's not smart, right? Because you want to delegate the important problems of your business to someone else. When I hear over hire Justin, I don't only think about overpaying. I don't only think about bringing too many people on. I also think about hiring people
Justin Piche (16:37)
Thank
Clayton Hepler (16:53)
to solve problems that the founder should solve. So I think about it in three ways, and I think most people make the last mistake, which is as a founder, I'm hiring someone because I don't want to solve this problem when it's my responsibility to do that.
Justin Piche (17:09)
this is Justin interrupting your podcast. I hope you guys are getting a ton of value from this clan are discussing why your business fails or why you don't grow it, why it stagnates some of the major issues that every entrepreneur can fall victim to. If you guys enjoy this content, please rate, review.
Subscribe to the podcast. helps us tremendously. And as always, we thank you for listening back to your regularly scheduled programming.
Yeah. One of the things when we were talking about what we're going to talk about today that popped into my mind for reasons why people's businesses fail or why you're going to go out of business as the title of this podcast is your the kind of flexibility in your business. here's an example for those. There's obviously there's a lot of different ways to run this type of business in terms of how you do transactions. There's some people that only do double closes.
and they never have enough capital to take down a deal. If they do, it's gotta be a funder. ⁓ And when you run a primarily double-closed business, and especially when you have a lot of employees, the market swings are hard for you. Like when you're in through the first quarter, know, sales are slow or acquisitions are slow and deals are not hitting, things are falling out of contract, you're not able to find the buyer, you've got a big overhead. If you have a big team that's generating that lead flow,
You don't have a lot of flexibility. rely, you're very heavily reliant on transaction volume to create income with no reserves or very little reserves in most cases. And I've definitely seen this happen before where somebody has had a great team. They've been able to generate great leads. The market shifted. They weren't able to disbow these leads. Their contracts started. They started having to cancel contracts. Then they have nothing in the pipeline to make money.
and they burn through their OPEX over the course of a couple of months because they have a high overhead. They have a lot of team members and they lay off their team. And like that the business is gone and yeah, they could probably spin it back up pretty quickly. But at that point the business is dead. They're starting over. And that is a real thing that happens to people in this business and having flexibility in your business to handle transactions in multiple ways. Being able to take down properties.
getting your pool of investors or building up your cash so that you can take them down cash, building relationships with lenders, having credibility. That gives you a lot more flexibility to weather fluctuations in the market. The way I started my business was with all cash myself, like cash buying deals and then bringing on investors but still always buying deals. In fact, to this day, we have yet to do a true double close where we actually
Clayton Hepler (19:45)
Thanks
Justin Piche (19:59)
do a pass through and I don't bring the cash to closing. Even if it was a double close, we lined it up on the same day. We did something like transactionally funded or in one case for my biggest deal that I've done with my partner, Ben, ⁓ we got a owner finance note for like $4 million from somebody so that we didn't have to double close. So we basically bought the property. We got an owner finance zero money down note. We generated a deed of trust.
You know, we bought the property so then we could furl on and sell it to the next parties involved and then closed out the next transactions the next day and paid off the deed of trust in full for a fee. So it wasn't even a true double close, even though we didn't have to bring any cash to closing just a little tiny bit of cash, not much. But it wasn't a true pass through double close.
Clayton Hepler (20:49)
Mm-hmm. Mm-hmm. Yeah.
Justin Piche (20:51)
But what there's a couple things
real quick that that you know doing transactions in that way gives you that kind of the wholesale or double closed only model doesn't is like when things get tough, especially if you've bought properties in cash, you have assets that are worth money that can be leveraged to provide capital for your business. And if you don't have any properties in inventory, they're all just contracts. You don't have anything that you can.
Pull cash out of it. There's nothing there. The cash is in the future when you find the buyer.
Clayton Hepler (21:23)
That's right. That's right. That's right. I, when I heard, when I, when I heard you walk through that, I was thinking about building a repeatable machine. They can weather any storm. So not a one one-off deal, like especially early on, everyone has a story of I got that deal and it just clicked for me. And I knew that this is the right thing. And they ride that wave of I got that deal and it helped me survive.
versus I have a predictable, reliable, consistent machine that produces outputs and outcomes for me. That's how you build a real business. That's how you go from a hustler to a CEO. That's how you go from
Justin Piche (21:53)
you
Clayton Hepler (22:04)
a hustler to a business owner. ⁓ It's the consistency, right? Consistency is all these ingredients added to one. It's tracking the KPIs. It's making sure you hold your team accountable. It's making sure the calls are made on the time that they're made. It's making sure the marketing goes out.
It's making sure that you check your P &L every month. It's all these things that create a consistent output. And what happens if you don't do one, two, three of these, you start to lose that consistency. In your organization, there becomes a culture of inconsistency and it bleeds through everything. And it creates a barrier to build a real business. And the people that I know that are most successful, whether it's in land business, wholesaling,
Justin Piche (22:27)
if
Clayton Hepler (22:49)
you know, similar types of adjacent, you know, direct marketing, direct sales and marketing businesses. It's those people that have the repeatable machine
that they know they can look at their KPIs and say, all right, so we've had this amount of leads and based on historical data, we're going to have this amount of contracts this month. And based on that, we're going to have this amount of revenue in three months because our average cash conversion cycle is 120 days. So I can predict what it's going to look like.
Justin Piche (23:19)
Yeah. So important. Man, what's another one?
I think I think a real one, a real thing, a reason why people's businesses fail is because they let them because they're burnt out. Like burnout of the constant churn is a real thing. And to me, I've seen this a couple of times for different people. I was just having a conversation with a with a coaching client the other day and they're not burned out by any stretch. In fact, they're exceptional operators and they're scaling. And I'm like just so impressed with what they've what they've built.
But the conversation we were having was all about how do you manage so much? Because people who know me, who know what I'm working on, know the deals I'm working on and know my team and know my family and like what I'm doing in my day to day life. They look at me and they're like, you have a lot of horsepower. Like you're like, you're just a crazy person. Like you just start go, go, go all the time. How do you manage it all? And the questions were really designed around how do you manage all the different things that you need to be involved in in the business?
And so our conversations essentially drifted to like, how do you empower your employees? Right? what do you, right? There's problems, you alluded to it earlier, right? There's the ⁓ pitfall you can fall into, is there's problems that you need to solve as the owner and you don't want to solve them until you try to hire somebody who has the same passion as you to solve these problems, but they can't do them because you're the only one that really can. But there's a whole slew of other problems and responsibilities and outputs in your business that you don't have to own.
Clayton Hepler (24:28)
Mm-hmm.
Justin Piche (24:53)
that you don't have to own. The more things you have going on in your business, the bigger it becomes, the more deals you're working on, the more marketing you're sending out, the more types of projects you're trying to tackle, et cetera. The more you have to get good people into those roles that are the decision makers, that are the ones executing on those tasks. And so for them, in their specific case, they're still owning almost everything in the business. And they have really quality employees that are working on a bunch of different things.
But the ownership of everything is still just overwhelming and it feels like chaotic. It feels chaotic in their brain because it's just one problem and then another problem and then another problem. And I got to solve this and I really got to pour my mental energy into understanding this whole problem before I can provide a solution. And then this one and it just is it you burn out if you operate that way for too long at too high a scale you will burn out and you just won't want to do it anymore. You'll long for that time when you clocked into your job at 8 a.m. and clocked out at 5.
got your paycheck and you left all your work at work and you got home and you just hung out with your family. there's frankly, there's nothing wrong with that. isn't sometimes I think that sounds like a pretty nice way to live for a week or two. But then I would get too bored personally and I'd want to be thrown back into the chaos. ⁓ But yeah, mean that burnout is a real thing. And so like as you scale, as you become a CEO of your business, you can't really become a CEO without
Clayton Hepler (26:07)
Ha!
Justin Piche (26:24)
empowering your team to actually get some of the core problems solved and the core outputs produced.
Clayton Hepler (26:30)
Yeah, over the past couple of months, we've been talking about like making the strategic hires and.
The mark of a true CEO, someone that can build a lasting business is someone that hires for a purpose that is built, is rooted in their KPIs, in their business. Not because I heard Justin and Clay talk about their great director of revenue hire or their operations manager, right? The decision on hiring, and this is a strong statement,
Justin Piche (26:56)
you
Clayton Hepler (27:09)
should be made by you and you alone. Because you know your business. Now of course there are exceptions. If you're working with someone that is a consultant or you have someone else in your business that's a business partner or someone that can give you that additional insight into your business, like we're looking at the KPIs together, you're with your partner, you're looking at everything, that gives you the context to hire. But sometimes people just hire people
Like you said, because I'm burnt out with this and I don't want to do it anymore. And it has to be rooted in the data, right? It has to be rooted in, need this person because if I hire this person, what do I do? I need to solve a $500,000, million dollar, five million dollar problem and I need this person to solve a X amount of problem. That's what the purpose of the hiring. And another thing.
as it relates to hiring, right? When you go from a hustler to a building a real business, hiring is really difficult. Finding the right person, placing them in, having
Justin Piche (28:14)
Okay.
Clayton Hepler (28:17)
a culture fit, training them up, it is incredibly expensive. ⁓ Not only because it requires an expense to find the person, but the amount of employee time and ⁓ time that it takes to bring someone on.
Justin Piche (28:17)
I'm a few minutes to get this thing started.
Clayton Hepler (28:33)
As you get to be a bigger business, you say, my gosh, this is like crazy, right? And so, making sure that you have a hiring protocol that you use ⁓ helps you build a sustainable business. The one thing that I heard, this is from Jeff Bezos. Jeff Bezos has a policy at Amazon that is every hire that he makes should be 50 %
more of a culture fit and 50 % better at the position than the current person. So if you're hiring another acquisition manager like I am right now, exactly what.
Justin Piche (29:08)
The bar razor it's called a bar razor. I remember that from my time at excellent. I mean Amazon
Clayton Hepler (29:16)
Okay, the bar raiser, yeah. Or you can speak more too, but...
Justin Piche (29:19)
No, no, no. That was it. That's really all there is
to say about it. It's like, yeah, any higher needs to rate like we if we haven't, if we have, if this is our average 50%, every hire needs to be above that to raise the bar.
Clayton Hepler (29:35)
and it gets hard, but it's a good heuristic, right? It's a good heuristic. The question then comes is like, how do I do it with that with a VA? Right? So if I'm bringing a VA on that's ⁓ another, you know, a co-calling VA, how would you think about that, Justin? How would you like, you know, bring, because, you know, there's a, there's a financial thing there, but how would you think about bringing on someone maybe that's a more, let's say an entry level position?
into your business, and I could talk about how I would, but I've been talking for about 15 minutes. So how would you bring someone on that's more entry-level person to raise the bar to build a sustainable business?
Justin Piche (30:18)
mechanically? Like what are the mechanical steps? Tactically? Well, the first thing is like, obviously, the assumption here is that I need this person because I've decided that I want to scale up marketing or something like that. So obviously, the first thing is, do I need this person? Can my current team do this part? Do this job? Or? Or do I need somebody new to get it done? So you got to make that decision first. Once you've decided, yes, I do in fact need a new person to come in for me.
Clayton Hepler (30:19)
You have a cat like tactically like tactically tactically.
Justin Piche (30:47)
That would go down to my ops manager and say, Hey, we need a new cold caller. I need you to post a job, conduct interviews and hire. And then that's exactly what she would do. The direction I've given her, cause we're doing this right now. The specific direction I gave her was I actually need more experienced cold callers. Like I want to bring more experience into the cold calling team. ⁓ and so her job is to vet and find people who have
track record of doing this job at a high level to bring into the team to help exactly raise the bar. I that's exactly what I told her. I talked to her about the bar razor principle before I gave her the direction to hire hire this person.
Clayton Hepler (31:30)
make sense. And so she's actually conducting the interviews.
Justin Piche (31:33)
yeah, yeah. Yeah. So I would say for me an entry level position is probably like the wrong, I just don't do entry level interviews anymore personally, but I do hire supervisory, specialist roles or managers, ops managers.
Yeah, I mean, if I'm hiring somebody, my process is probably pretty standard. You know, I create the job description and list the job. I give it a few weeks to bring in candidates. And then I, I generally do like a video interview to start and have them submit like a list of questions somewhere like the kind of non-negotiables for me bringing in this person. And then everybody who meets that kind of criteria, I watch all of the videos. Sometimes it takes hours.
And then I start ranking them in my mind based on their videos and their based on their videos and culture fit and what I feel like how I feel like their attitude, the way they talk, the way they explain their experience or their motivation or whatever, whatever questions I asked them in the video interview. And then from that list, I go through all their resumes in detail and highlight the ones that I think based on their accomplishments, at least what they have said they've done would be the best fit for the role or the most qualified to do the role. ⁓
And then I conduct interviews with all of them for round one, do kind of another assessment. And then those folks that are the top, maybe three to five second interview and then make a higher decision after that.
Clayton Hepler (33:06)
Yeah. So for me, when it comes to that, it's a, you know, entry level, I, well, it'll be departmental specific. we have a, my executive assistant is sort of the director of HR here. And so she will post a job for everything. She'll post a job. You know, for example, we're hiring an acquisition manager right now. If anyone is interested, you can go to any of my social media. ⁓
And DME and we have an assessment if you're interested in joining our team as an acquisition manager. ⁓ basically the process is we have a cognitive and personality-based assessment that we use. ⁓ And then we have a call with my HR manager just to make sure this person has a pulse, make sure they understand the specifics of the job. But before we even send that, we do what you said, is
We have a type form. if someone passes this assessment, they have to go above a certain score, right? And then after that, there's a type form that these people fill out. They submit a video, their resume, et cetera. Then we read through that and then the top people of that get on a call with my HR person. And then we have another one of our team members interview them for a cultural interview. And then I'm the last interview. At that point, we vetted them so thoroughly that we might have 400 applicants of which
Justin Piche (34:04)
you
Clayton Hepler (34:28)
80 get get through the the assessment that score high in the assessment of which maybe 60 or 70 get through the type form of which maybe 30 or 40 get through the first interview in the second interview of which maybe 10 get through the sec in her second interview if they get to me they're the right cultural fit they're the right
You know, they have the right bent. understand the job ⁓ post. They understand the description and it's just more of technical interview with me. So at the end, it's a 30 minute technical interview for me. And then I also do the bar raise. So for this job, it would be, Hey, you know, are you raising the bar in our acquisition team? Cause we pay our acquisition reps like an insanely well, ⁓ you know, probably the highest in the industry, ⁓ for, know for land, it's definitely the highest in the industry. ⁓ so
Justin Piche (35:26)
That's a bold claim.
Clayton Hepler (35:28)
Well, okay, maybe not with every company in the United States, but I know that we pay much.
Justin Piche (35:35)
You compensate your
team really well. Let's just say, yeah, that's probably a good statement to stand on.
Clayton Hepler (35:38)
Yeah.
Yeah, speaking of absolutes, we compensate our team incredibly well.
Justin Piche (35:49)
I want to be accurate and careful. There's somebody who's gonna comment and be like, how much do you pay him, Clay? I want to judge. Oh man.
Clayton Hepler (35:51)
That's fair. That's fair. That's fair. That's fair.
That's a good,
no, I appreciate that, I appreciate that. So yeah, so what else do you have, for making sure that you don't fizzle out, your business doesn't fizzle out, you build an actual lasting business?
Justin Piche (36:12)
Yeah, one of the things that I think can really maybe it doesn't put you out of business, but it can be one of the things that starts to decline is being a good leader in your leadership skills. I mean, a lot of people are totally fine as an employee or as like an individual owner. You know, they can work really well. They can accomplish a ton themselves. But when you start hiring employees and you start having to
direct them in certain ways and you know, set the vision for your company, hold them accountable, build them up, train them, break down the barriers for them. There is an aspect to ⁓ leadership that I think is tough. I mean, it really is. That's why not everybody is a leader, frankly. I think everybody can be a leader. I think there's nothing stopping you from becoming a good leader. But if you don't invest the time into actually understanding what it is that makes a good leader, then
I could see that being, I mean, that is definitely a way that people's businesses start to fail when you have a lot of, and the biggest indication probably is employee turnover, right? If you have a lot of employee turnover, that's something that can be exhausting. mean, we just talked about kind of our hiring, how we would hire folks. And if that didn't sound like a ton of effort and energy and work and commitment on your part and your team's part, I don't know what would, because it is huge. And in fact, every time I think about hiring a new person, I literally have to like mentally,
get over the fact that it's going to be really hard and it's going to take a lot of time to get the right person. There's no quick way to hire. And anytime I've ever thought, I'll just hire somebody quick. You know, it generally doesn't work out very well. If I don't put the energy and effort into hiring the right person on the front end, I pay for it significantly more on the back end. And anyway, it's just, it's, it's a lot. It's a lot. ⁓ so high employee turnover can crush you.
because it puts you into this spiral of constantly having to retrain and rehire new employees. And it takes a ton of your time away from core revenue driving activities. We've talked about the glue. You've mentioned this before on a business when you're on a podcast. It's like when you implement a process change or something like that, there's immediately like a 20, 30, 40, 50 plus percent decrease in the productivity of the team. Okay. It's the same thing with hiring and getting people into these core positions.
If they turn over on you in a not great way, like a sudden departure, you have to fire them or they just leave of their own accord immediately. It puts you in a really, really tough spot. And so one of the ways to not have that happen is to develop leadership skills that both inspire team that build loyalty and trust so that that doesn't happen. And like my, my goal is not necessarily to have no turnover. Like I don't, these people work for me forever. My goal is to have.
to build a relationship and a trust between me and the employee such that in the event they do decide to leave, there is a respect that allows them to transition with the next role. And so that I am not taking the full burden of training and hiring that new person. I can utilize their skill set to transition their knowledge as much as possible to that new person. So I would say I am winning.
if I have the level of trust and loyalty with my employees, that they would extend me that grace. And now there's always extenuating circumstances. You can't predict and prevent everything. But that's my kind of main goal with the relationship I have with my employees is that we have enough respect between one another that we wouldn't leave each other out to dry. It's one of the reasons why if I've ever let employees go, there's been a severance. I've never cut somebody and said, you're done, no pay. Even employees that weren't performing, frankly.
I've still given them the grace of having ⁓ some income to transition into a new role. And if somebody, if it was somebody who has been with me for a long time, that, you know, I really respected, of course, like I would give them like a more runway probably than, than maybe just like an entry level position who wasn't performing. I think they know that well enough to extend me the same respect is that if they were departing, they'd give me enough heads up that we could bring somebody else into the role too, too, for continuity.
Clayton Hepler (40:22)
Mm-hmm. Mm-hmm.
Yeah.
Yeah, well, I mean, I think this is a great episode talking about the things that really prevent people from scaling their business, really prevent people not from scaling only from keeping their business going, which is honestly scaling, right? Keeping your business going, keep that the consistent income coming through. It allows you to scale when you have the cash, when you have the the skills, when you avoid the shiny object skin room, when you do the boring work, when you focus on the
the KPIs, when you stay small to grow smart, when you build your repeatable machine, when you hire right, when you do all these things, you build a consistent business, a real business, not a hustle. You're not a high paid freelancer, right? You are a business owner. Justin, any last things here before we depart?
Justin Piche (41:07)
.
I think that'll cover it. mean, there's a ton of other smaller reasons why somebody's business might fail. You know, this is not a comprehensive list. But I think if I was going to say for the audience, like, what's what's a takeaway from this is that there's a mindset shift that has to happen.
when you transition from that hustler to the CEO. And there's a never ending self improvement and self education process that has to be kind of just built into your DNA, I think to continue to sustain a business through through the ups and downs. So if you're making that transition from a solopreneur or one or two employees to like a larger scale operation, I'd encourage everybody to spend some amount of time working on themselves as well. Right.
some amount of time improving their own skill set to both manage and scale their team, lead their team to avoid some of these major pitfalls.
Clayton Hepler (42:20)
and instead of better myself. Guys, you know at the end of the podcast, all we ask is the gentleman's agreement, which is please rate, review, and subscribe. Let other people know about this free podcast we put out every single week. We hope you get benefit from it and the way that you show you get benefit from it is you guys give us a rating review so we can keep this thing free and flowing. Until next week, we'll see ya.
Justin Piche (42:46)
See ya.