Lessons - The System Behind Scaling Past $10M Without Your Business Falling Apart | Natalie Dawson - Cardone Ventures Co-Founder

In this lessons episode, discover why great businesses are ultimately built through a great people strategy. Understand how to attract ambitious talent by creating a company people want to grow with, explore why founders must actively play the long-term talent game, and uncover how leadership, culture, and example can turn a job into a path to success. What's the playbook for somebody who is in a service base or even not service-based? Who should they be looking to? Who should they emulate? Who's done this like very, very well repeatedly? Who's like a better entrepreneurial, I don't know, influence? Then all the stuff we see on social and YouTube and podcasts and all that stuff. Because we service all of these different industries, we're industry agnostic. We do have a couple of investments in healthcare. We have investments in HVAC. We have investments in roofing and dental. We find that in every one of those industries, there are micro influencers who have gone from being the dentist, having their hands in somebody's mouth, and actually scaling to 15, 25, 45 dental locations. And they are creating content, but they are not creating content where they are getting millions of views and have all of these subscribers to their YouTube videos. It's such a niche audience that they are really talking to. And so for every one of these verticals, we do find that there are influencers, but they are not at the level. And they are so specific to, you know, I think of Tommy Mello in the garage door space. It's not so, so niche. The garage door is yet. Yeah. He sold his business for half a billion dollars in the garage door space. So there you have somebody who is now probably going to create a larger influence because he has done something that's so spectacular, but it started as just a guy figuring out how to sell garage doors. And so as people become more successful through the markets that I'm sorry, the industries that are hot right now and getting huge valuations, somebody like Ken Goodrich in the HVAC space selling gettle over, he sold it now three times for over $250 million. They will start to come out and have more social presence, and they will be creating individual industry specific playbooks on how to do this, whether you are a chiropractor or a dentist or whatever the vertical that you are in. But the principles remain the same, which is why I feel very confident in writing a book like start the work or writing a book like teamwork where at the end of the day, if you're a business owner, taking VC money is a little bit different. And we don't we're not pro VC money for the majority of businesses, because you really shouldn't be accessing that capital unless you already know the basics of what it takes to run a business. And the majority of business owners are not trying to raise VC capital, but they think they think that oh, maybe that's interesting or exciting. They should really like get their teeth knocked in first by creating a marketing agency or hiring their first team or figuring out some of these standard foundational skill sets. How do you review financial set of documents in a business? Do you have that core competency before you go ask somebody for money, much less your friends and your family for money? Like you should have these very foundational business skills in place where you've demonstrated that you were the right person for somebody to place money with you and not on like a hope and a dream, but on a real live example of this is me demonstrating that I actually know what I'm talking about that I'm able to market that I'm able to solve a real problem. And you don't get that through not having some sort of experience. So the X factor and I agree completely. I mean, I think too many people raise money. I think that so yeah, if you don't know how to read a PNL or even create one, like that's a big issue. So the caveat that the takeaway is don't raise money for most businesses, build it profitably from the get go. But the X factor like you can build SOPs. People will understand the concept of building systems and processes around what they know. Even if they're not doing it, they can do it tomorrow. The X factor is people. The X factor is always people and I've heard this time and time again, especially post COVID. And even I don't know what the rest of the US is like with the rest of the world, but I have friends that run businesses and I have not had to hire people in the US since COVID ended. So I've been able to hire all over the world. Pre COVID was a different story. We had people in Canada and the US, but post COVID, it's all been, it's all been all over. But I have friends who have tried to hire and they say that the talent landscape post COVID is very difficult. It's very difficult to get great people. And these people are not bad business leaders, but it's like the wildest stories. Like somebody will be hired, W2 employee, and then negotiate a salary. And then the first week they'll say I want more money. Like things that didn't happen in my life at least. So the X factor is always people. The first person like that founder led business, they're making money themselves. The higher sales rep, maybe they're not closing as much as the founder does. So those first few hire are super important. How do you navigate the talent climate? How do you find the right person? What is like, what is your framework? Because now you have thousands of employees. So you figured it out. What is that strategy? I am a big believer that business is one through creating a people game. And you have to think about yourself as a founder, as an entrepreneur, playing a game with finding great people. It's not just, oh, I'm going to find one person and they're going to solve this problem. And I'm playing this game of checkers where it's just one piece at a time. Oh, I need a marketing person. Oh, I need a sales person. Okay, now I'm going to go out and recruit. It is a game that you have to play for a long period of time to help the market understand why you are the founder or the entrepreneur or the business that great people want to work with. And so first it starts with, how are you promoting that you are a great place to work at? Are you talking about? And our business card adventures, are you talking about the fact that people are winning inside your company? Not just your clients, but your team members. We have team members who came to work with us who were making $60,000 a year and are now making $400,000 a year. We've only been in business for five years. We promote those stories, but we're thinking about that when we make that initial hire of somebody who is saying, I'm making $60,000 a year. I'm applying for a job here at this conversation, but I have radical goals. So how do you find people who have radical goals, but are at a starting point where the business can afford to hire that person? Most businesses cannot afford to hire somebody at $400,000. They can't afford to hire somebody who is hungry that's making $60,000 who has the vision for their life of wanting to make $400,000, but has actually no idea how to get there because if they knew how to get there, they would already be making $400,000. We live in a free market economy. If somebody could go down the street and make that amount of money, they would go and make that amount of money. And so as a business owner, if you're playing this game of people, you're really thinking about, I need to create a brand for our organization where great talent thinks of us as a place where people come to find success and to have their success be easier with me than they would be able to find success with somebody down the street. So how are you promoting that? How are you constantly recruiting for people and posting jobs even if you're not hiring for those roles to tell the market that you are recruiting and you're constantly looking for great talent? And then once they come in the door, how are you exemplifying that you are actually interested in their success? I think what's made us successful in this hiring market over the last five years, pre-COVID, post-COVID is you're getting an opportunity to work alongside real leaders in a non-virtual work environment. We have an office here. We have an office in Scottsdale. They're seeing how I work every single day. They're seeing how Brandon works every single day. They are like rubbing shoulders with us constantly to solve the largest problems inside our organization. And if you take that and you apply it to a small business, we had the exact same principles five years ago as we do today. We create this environment that allows people who have this dream, have this hope for their lives because we're marketing to them as a candidate journey, not just a customer journey as a candidate journey because we're playing this people game. And this candidate journey is telling them you can achieve your personal professional financial goals through working here alongside us. We've achieved our personal professional financial goals up to a point. So there is some success that you can follow, but we have radical goals for this organization and we are committed to growth. So once they're in the environment in order to keep them, they have to actually see that we're really doing the actions that demonstrate that we're committed to those things. So if they saw us on vacation all the time or if they saw us not really being interested in their success, if they saw us just like half-assing the work that we do with our clients, it would be a different story. But instead what they see is a team of people and leaders back then when we had zero employees all the way up to today when we have hundreds of employees working on the weekends and being here before people and being here after people leave. And they really are understanding what it takes to be successful. So it's the entire package of we sold the dream. We're marketing two candidates that this dream is possible here because we have this target of where this business is going in the future and we're really clear about that target. And then once they come in, they are testing and watching and seeing how serious we are. And so we have to be serious every day. And I do find that a lot of business owners really struggle with that level of seriousness and that level of commitment because they create a business around a lifestyle. And if you want a lifestyle business, that's totally fine if that's your prerogative. But you are going to lose a people game if somebody else is not actually fulfilling their side of the, they're not being role models for the, yeah. You're going to lose that person and somebody else is going to find the better talent. because they actually want to be around people who are able to make their success easy. Thanks for tuning in. If you found this valuable, don't forget to hit that subscribe button, so you never miss an episode. And if you want to dive deeper into this conversation, check out the links in the description to watch the full episode. See you in the next one.