Scale Like a CEO

Scaling Cybersecurity Staffing with Peter Schawacker: A Reluctant CEO's Journey

• Performance Accelerated Learning • Season 1 • Episode 5

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Join us on 'Scale Like a CEO' as we delve into the world of cybersecurity staffing with Peter Schawacker, founder of Nearshore Cyber. Peter discusses his transition from a seasoned cybersecurity practitioner to a 'reluctant CEO' and the challenges and triumphs he faced in building a global staffing powerhouse. Learn how Nearshore Cyber is revolutionizing the cybersecurity talent landscape by offering unique solutions that focus on value, community, and human touch. Peter also shares insights on the importance of focus, the duality of scanning talent for clients and the company, and his vision for scale and growth. Don't miss this informative conversation packed with valuable takeaways for business leaders and entrepreneurs.

Peter Schawacker:

is unique is that we're not from. You know, staff from recruiting. I'm faking it. 28 years in cybersecurity. I've been a CISO, I've been a cybersecurity practitioner for a lot of years or I was, I should say and I came to cyber staffing having hired really great recruiters. Now I'd hired some knuckleheads. They weren't all good.

Announcer:

Welcome to Scale Like a CEO, the podcast where we dive deep into the challenges and triumphs. Now I'd hired some knuckleheads they weren't all good. Founder of Nearshore Cyber. As we discuss how he's revolutionizing the cybersecurity talent landscape and building a global staffing powerhouse, let's dive in.

Justin Reinert:

Hi Peter. Thank you so much for joining me on Scale Like a CEO. If you wouldn't mind to get us started, just share a 90-second intro of yourself and your company.

Peter Schawacker:

Yeah, I'm Peter Schavaker. I come from the cybersecurity world 28 years in that, Some years before that in IT Became a reluctant CEO three years ago when I started Nearshore Cyber, which provides cybersecurity staffing and recruiting services to clients in the US from Mexico and other places like Mexico.

Justin Reinert:

I have to ask reluctant CEO tell me more.

Peter Schawacker:

Well, I'd run business units for other CEOs, for other companies. I've built divisions and I've gotten close to a lot of people who've ran companies and I could tell it's hard and most people fail at it and I wasn't sure I could do it. But I reached a point in my career because of where I live I live in a town called Oaxaca in Mexico my could do it. But I reached a point in my career where, you know, because of where I live I live in a town called Oaxaca in Mexico my Spanish is terrible and I thought I'm kind of at a disadvantage but I better do it because it was getting hard to find work. I'm in my mid-50s now and I've been told for years like Peter, you should start a company. I'm like, yeah, and I should write a book too. I decided it was the time I had the right business concept and I'd seen enough of the world to understand how business works.

Justin Reinert:

If you look at your industry, what do you see as one of the biggest problems and how you're solving that?

Peter Schawacker:

The inability to understand what represents value to the businesses that people are protecting. I serve two kinds of customers. I serve customers who are trying to reduce costs, find better quality for their own internal security teams, get people cheaper with a bigger talent pool. My favorite clients are the ones who are using security to make money, who offer cybersecurity services to their customers managed security services, consultancies, things like that and the problem they have is not understanding what the value of their services and why they should be charging more margin for it. We help with a different range of talent, a broader pool than people have just in the United States, and at lower prices. We also help people enhance value. Most business owners don't understand the value that they provide. A lot of what we do is help people understand that.

Justin Reinert:

And so what makes you unique in the way that you're helping others it sounds like that might be one is helping these businesses understand the value they provide. But if you look at your business as a whole, what makes you unique?

Peter Schawacker:

What makes us unique is that we're not from, you know, staff for recruiting. I'm faking it. 28 years in cybersecurity I've been a CISO, I've been a cybersecurity practitioner for a lot of years or I was, I should say and I came to cyber staffing having hired really great recruiters. Now I'd hired some knuckleheads. They weren't all good, but the recruiters that I worked with understood my business better than I did and they would stay on top of what we were doing and what resources we needed and what we didn't need, and they understood the timing of it and the math and would show up with solutions before I knew I had problems. So they became advisors and I really loved that.

Peter Schawacker:

I also have hired a lot of people over the years and I've been on both sides of the table. I knew what it was like to be treated well by recruiters and I knew what it was like to be treated with disrespect. I understood how simple it is to treat candidates with respect and what a difference that makes when it comes to the entire process, so the value they deliver and the performance of those people after they get hired and how well they perform in the recruiting process. And so, although it's not unique, I'm a member of the cybersecurity tribe and I have a seat at security leaders' tables. By focusing on the cybersecurity niche and being an expert at being a foreign foreigner in Mexico, in dealing with the Philippines, in dealing with Greece and South Africa and Mumbai right, we're able to lend a perspective that few, if anybody else, has. I don't know if it's unique, but it might be.

Justin Reinert:

And so, as you have navigated this transition of being the CEO of Nearshore and growing your team, what are some of the challenges that you've faced as you've scaled the business up?

Peter Schawacker:

Number one was focus. When we started this, we decided we were going to be in staff for recruiting and that we were going to lead with recruiting. Because you charge a commission, you get paid up front, the deal is over, pretty much 90 days after the guarantee is expired, you're out Right, simple. But we didn't know what we were doing at first and we got a little bit of recruiting business. It was fine. It was all friends and family stuff. But to put bread on the table, we took on professional services. I looked at my history as a consultant and the collection of consultants I was working with and we realized we had like 11 lines of business. It was like awesome, we are diversified, we do all this stuff and it was 35 different services we could deliver across 11 lines of business.

Peter Schawacker:

We spent the subsequent two years killing ourselves trying to execute everything Not very well across 11 lines of business. We knew how to do all the little services within those, but we didn't have repeatability and we didn't know how to go to market. What we were really good at was marketing. So we built a community of practice as we were struggling to figure out who we were, what our identity was, what we were going to focus on, and eventually Q4 last year, q1 of this year, a few things happened focus on. And eventually Q4 last year, q1 of this year, a few things happened. One we cut out all but one and a half of those. So we still have a little bit of legacy cybersecurity assessment that I'm going to let sort of fade out. It just comes to us. It's like so easy. But we decided to focus on staff and recruiting, and mostly on staffing, which brings different operational challenges, but we're getting good at it.

Peter Schawacker:

Number one was focus. Cut out all the stuff that we were running hither and yon for and focus on cybersecurity and the areas where we recruit.

Justin Reinert:

That's it. I think that's a common thing that founders, ceos of scaling businesses find is you kind of want to do a lot of things, but it's hard to scale a lot of things and it's much easier if you can narrow that down to what are the few things that we do the best, and then how do we build that?

Peter Schawacker:

Or one. Really, we do one thing, and that's find smart cyber professionals faster, with lower risk and less hassle. I mean, we track over 8,500 people around the world, and mostly in three or four countries. There are about 30 that I really, really, really like, and so most of my time goes into sifting out the great ones from the good ones. Scaling takes the form of two different markets there are the buyers and there are the sellers. We're broker, that's kind of all we are. But in the same way that a real estate agent has to focus on a geography and not the planet, a class of real estate and one kind of buyer, one sort of avatar, to be successful, not the whole world If you want to do the whole world, be Redfin, or if that still exists, it does. Yeah.

Justin Reinert:

What's helping you create greater scale as you move forward?

Peter Schawacker:

When you get started, you sell your friends and family, but then you run out of friends and family. Our answer to that was make more friends. For the first two and a half years, when we were totally scattered and not at all focused, there was one thing that we did really well and that was build community. We have a community on the Circle platform. We have free educational events, we do cybersecurity simulations, we have networking events, we have meetups all this stuff and it's all for free. We overinvested in marketing. One of the reasons was I didn't know how to sell. I didn't have the skills yet I'm good at it, I have talent and I enjoy it, but I didn't have the technique yet. I'm working on that. So while we were figuring that out, we did a lot of marketing, a lot of community development, the old Gary Vee jab, jab, jab, left hook thing. We just jabbed. For two and a half years we made a lot of friends.

Peter Schawacker:

Now, when I reach out to people selling to them, lots of them. When I reach out to the labor market, people already know us. There's none of this like oh, you're just a commodity recruiter, you're going to waste my time. People have heard of us, so there's at least brand recognition, and that makes that. That creates scalability in terms of how easy it is to reach out to people.

Peter Schawacker:

For you know, left hook, like, would you like to? Would you know, do you need people, and when and where and for what? And are you looking for a job? You want something new, right? And so we've managed to create a pair of flywheels that we operate all the time. They come together, sometimes Like there are people who I've reached out to for recruiting, who have turned out to be clients, and people who I've reached out to for to be clients, and who turns out like, oh, you're looking to change jobs, like all right, or you have people you're about to lay off, send them to me, I'll try and get them soft landings. So the community comes together at a certain point, but we approach them we've learned how to approach them in different ways.

Justin Reinert:

Yeah, you know, I actually spent a handful of years in the staffing world running talent development in-house. I'm familiar with the world and I'm curious. You know there's an interesting duality where you are constantly scanning talent for your clients, but then you're also, as you grow your own team, scanning different talent. So, as you look at growing your team, how do you identify the key qualities in the people that you're adding to your team?

Peter Schawacker:

I look for people who care about the community we're in. It's easier to teach business operations and marketing and interviewing skills than it is to get people to care about security people. It's a strange little community and it has its own culture and aesthetics and style and traditions, so I start with that. For example, in the Philippines, I'm looking for a community leader, somebody who can do marketing but also can help out with local interviews, like deep fakes are a problem. It's, you know, june 16, 2025, there were people who were using technology to impersonate other people or you know whatever, and the solution there is meet them in person. Right, I mean, like we used to do that. We used to, like show me your ID. Okay, that's like a real ID, I think, or you are at least a real person you know. So we're, you know. We need to be able to do that. That means that people need to be part of these communities. They need to go to the conferences, they need to be in the forums.

Justin Reinert:

So yeah, that's great.

Peter Schawacker:

Do you have people on the ground in the markets that you're recruiting in? Most of the people we have are actually volunteers. I'm just now starting to recruit paid community managers in Philippines because we want to do some things in Manila, in Mexico City, and we're trying to decide between Cape Town and Portugal for EMEA, mostly about time zones, but it's also about being able to see people in person. Emea presents a challenge in that the low cost areas are not where people put on events. Manila's a little better, mexico's easy yeah.

Justin Reinert:

I have to go back to this reluctant CEO thing. As you're growing the business, how do you go about kind of delegating down in the organization to free up your time, to be able to focus on the vision?

Peter Schawacker:

I wait until I can't stand anymore, because if I don't understand the details, how am I supposed to manage someone who's going to do it? Even if somebody knows more than I do, they don't know the context, and so it's incumbent upon me to be in the dirt, as they say.

Peter Schawacker:

I still do my own tech interviews. Why? Because by focusing it I'm able to preserve enough of my time and be pretty efficient with it. Clients expect my fingerprints on the deal. I will bring someone in to work with that when I have sort of exhausted the question of how do you do a technical interview with someone who is going to have control over and is responsible for protecting the crown jewels In cyber. We're always talking about critical assets. The people who are going to have control over and is responsible for protecting the crown jewels In cyber we're always talking about critical assets. The people who are going to secure those have to really know what they're doing. Do that. I record the technical interviews and the clients get the interviews. I did it by mistake. I thought you should do that. Then I started presenting candidates to clients that way and they were like wow, I wish everybody knew this. I'm like they don't.

Peter Schawacker:

Right candidates to clients that way and they're like, wow, I wish everybody did something like they don't right. I've learned a lot by doing things the suboptimal way but finding out that that's actually the right way to do it. We're very choosy about our use of ai, very choosy. We're very careful to insert human humanity where it should be and automate when it gets us the highest value human interactions. There is an optimization thing that has to happen and I think the ratio of human to computer is much more strongly on the human side. I'm very pro-AI. I insist on AI knowledge and hands-on experience in candidates. Now, if you're anti-AI, we're not talking. Still, it's a matter of applying the right resources, the right points, and to do that I have to understand the processes intimately and I have to get it wrong for a while. That's why it took two and a half years before we really figured out how to focus.

Justin Reinert:

I really like that human focus that you have. I think some people are losing touch of that in this race for AI adoption and remembering that we still have to be human in the way that we work. Yeah, as you look forward, what's the vision for nearshore cyber?

Peter Schawacker:

One, not die. There's a ton of work in this. It's an enormous amount of work. I have sympathy for people who want to automate the whole thing. I get it. There are days when I'm just like I wish I could press the just go make money button. It doesn't exist.

Peter Schawacker:

Our goals are scaling the business in terms of operations and revenue. What that allows us to do is build a community and then the community feeds the business. There's this virtual cycle where, when we have healthy revenue, when our margin's good like we're not the cheapest, we're not the most expensive, but we have healthy margin we have enough revenue to sustain the business and I can spend more time on developing the community, which is our marketing. I would like, by my big goal is by 2031, to have a CEO who's running these things so that I can step back and have the option of retiring if I want. I am convinced that there is a better, like operating normal CEO out there who would run this business better than I can. My job is to prepare for the moment where we can pay them and provide a business for them to run so that they can take this to whatever the next level is, wherever that happens to be. I'm just here to get it started. At some point my usefulness as a chief executive will be gone.

Peter Schawacker:

I don't know if I'll do another one. I think it's too old to start another one. If this works out, this is the finale for Peter. It'll be good.

Justin Reinert:

Well, that's great. And so what if you think about that vision of getting there? What are some of the critical steps that need to happen by 2031?

Peter Schawacker:

It's really a matter of creating predictability and measurability in the business. Our metrics right now are really brutally simple. It's measured by the amount of stuff in our calendars and the quality of what comes out of it. It's not very subtle or sophisticated. It is complex. We're trying to strike a balance between the business as a machine and the soul of that machine. It needs to be a little bit messy, there needs to be some art in it, or we become just like we could automate the whole thing, but then no one would want to do business with it because then we're just a piece of software, right? So, striking the balance between the mechanical and the automated and the human, like we need to be faster. We need to be able to turn around proposals in 15 minutes instead of four hours. We need to know that there are handoffs between global regions. We're global. We're 24 7 365. How do we sustain that or build on the business in a way that it's uniform around the globe and people get what they need?

Peter Schawacker:

Um, without regard to like time, time of day, day of week and yeah, like it's it's it's really boring. I mean, I think that's the goal actually. I want nearshore cyber to be boring in 95 of what we do and the five percent that's interesting is just marketing. I do not want interesting payroll. I do not want interesting business operations and compliance. Very little of this stuff should be interesting. I mean, that's the crazy thing. It's like at first it's all interesting because it's terror right, it's all new, and then eventually you get to the point where it's just like I could really use a day when nothing happens.

Justin Reinert:

Well, Peter, thank you so much for joining me. For anyone who wants to reach out and get in touch, what are some of the best ways to do that?

Peter Schawacker:

LinkedIn, linkedin, until the wheels fall off.

Justin Reinert:

All right, great. Thank you so much, Peter. Pleasure spending time with you. Jason, Take care.