Behind the Scenes Business Trends We Are Seeing

0:00All right. So we want to take a second to share some behind the scenes things that we're seeing with businesses. So Neil and I, we have conversations with our CEO friends or other CEOs that we work with, like clients, for example. And just the other day, Puerto Rico, I met up with actually three friends for dinner before I dropped in for a conference. And so I'll kick it off first. Neil, you can share some things. And we're not going to name any names here unless they're comfortable sharing this stuff. But what I've noticed, and we've talked about this, is actually I'll start off with this. We have a mutual friend.

0:31I'm not going to name names here. But he's like, oh, yeah, for our company, we do not hire people from California. We do not hire people from New York. We don't hire people from Colorado. I was like, why is that? He's like, because those states cause problems. Like, you know, they're very litigious. And, you know, people are people are nuts. And we've had like a lot of, you know, we've had to deal with things there where like it's it's not our fault, but like people are suing no matter what. They'll find a reason. And it just ends up being a pain. And so what we started doing is we started to hire, you know, from Latam, you know, um uruguay for example or hire you know developers from um you know ukraine for example right because what he said was and the whole table agreed when we were having this dinner it's like you know these when you have people from other countries for whatever reason and there's a lot of reasons here but like it's they appreciate the fact that they have a job and they don't have the perceived like what they perceive as entitlement in the united states right and so like, yeah, we're just going to hire from other places.

1:29Like they, they seem to work better. They seem to align with the culture. They don't cause problems. And we just focus on doing good work. And that's what it is. And I was like, that's interesting. So, um, I don't know what you've seen as it relates to that meal. I haven't seen much to people not hiring from specific states. Um, we hire from wherever we don't really care if a state is people in the state are more litigious or not. We just look for the best talent or whatever they are. You know, we want to go and get them. One thing that we've been doing that's been working really well, you know, in this world, there's a lot of competition.

2:05So speed is everything. So we've been hiring people for eight hour shifts. And here's what I mean by that. Let's say you hire full-time people. Well, person on average may work eight hours in a day. Some may be less and maybe a little bit more. Maybe like six, you know? Yes. But if you hire them from different time zones and they're all working together in collaboration on a similar project, we're finding that it's not perfect, but we can get people to work on a project for 24 hours. You're just shifting three people in a day. And we're not doing that seven days a week. We're doing that for five days a week.

2:37And we're doing that for specific development projects or server projects. And it's causing us to move way faster. And it's saving us a lot more money in the long run, because when you're hiring people from different regions, the cost on some of these people and some of these other times in the regions is drastically cheaper than the United States. You know, one other thing that we've talked about a couple months ago is that the CEOs are back, right? So we had someone at dinner. He had, he had someone from his board become the CEO and it was a complete disaster, right? When you look at Flexport, for example, Ryan Peterson, I mean, it's Flexport.

3:09It's, it's been tough. Like their, their revenues dropped 70%. They're, you know, they're valued at$8 billion one time. Oh, 70%. Why 70 %? Go look it up. I don't, I don't know. You tell me. that's a lot i know a lot of people are struggling in this market but 70 is a big drop yeah i mean shipping containers used to cost a lot more money right so like you know early 2020 2021 yeah um so look i i think um the trend here that we're seeing is ceos are coming back like for example bob eiger is back right um ryan from flexport had to let go of the ceo this guy over here he's like yeah this complete disaster like everyone's back like our other mutual friend he's back um and his company right they have like you know had over a thousand people or so they've had to make some cuts.

3:51I'm largely back in the day-to-day. But you can see, I think for everyone, I'll see for myself, being back in the company, it feels good. It feels right. And it feels like it's hard to beat founder energy. For example, when you're able to drive things a lot faster and you're able to bring that, you carry the culture with you. And here's another trend that I've noticed, um, not really a trend, but, but a phrase that stuck out to me recently. So the people that wrote, um, they did base camp, right? 37 signals. I listened to one of the podcasts and it's like, yeah. So what do you define culture as?

4:27And so like, you know, culture is just like, it's not a thing. Like it just is what it is. Right. But it's a 50 day moving average. And I was like, that's really good. Like, because if you do an acquisition, it can completely change your culture. Right. Um, or if you hire some amazing people, I can like bring that moving average up or if you like hire a bunch of like bad people can take the culture that moving average right and so i thought that's a really interesting thing and i'm probably going to use that moving forward another business trend that eric and i are seeing is people are spending money on acquisitions see when the economy is really good and rates are low it's hard to deploy money because everything is expensive it's like why berkshire hathaway had such a massive war chest they thought so many things were overpriced.

5:07But when things get bad, people start deploying the money. Yes, businesses struggle, but it's the best time to deploy your money because you can start gobbling up things at more reasonable prices, sometimes cheap, sometimes reasonable. Sometimes you still have to overpay a little bit, but there's a ton of growth potential. When things are really good, a lot of times it's hard to deploy the money in a way that's economically advantageous to you. But when times are bad, even though your revenue may be hit or your profit may be hit, funny enough, those are typically the best times to deploy money.

5:42The question is, do you save up enough money? Or you can always get loans from banks or places like CapChase where they can help you get some capital where you can deploy it pretty quickly. Yeah, I mean, the other thing too is we're talking about burning cash. We've trended towards efficiency, right? So now that we're in, we're no longer this zero interest rate environment where cash is basically free, people are like, okay, how can it be more efficient? Do we need to make cuts over here? And it's also getting everyone focused in on, hey, doing good work and no extra stuff. Let's forget about the extracurricular stuff.

6:16Let's just do good work. That is why this company exists. And the phrase here that I remember is like, a business exists to create customers. And that is it. You create customers, you do a good job for your customers, and hopefully that cycle repeats and that's how your business grows. The last thing I'll leave you off with is this is more of an outlier. It's not really a trend, but I have this book in front of me over here. If you're just looking on YouTube, it's called Startup Factory. And this book is about Hire, which is the world's largest appliances company. And they're based in China, right?

6:48And they have this decentralized model. You can see they've Xed up this hierarchy over here in the picture. And it's all about creating this decentralized model where everyone in the company can be an entrepreneur, right? And if you create a business, you manage a P &L, you're responsible for it. And if the business goes public, you know, they'll put more resources, more resources to it, obviously. And if your business doesn't work out, they'll just demote you into like a pool of other employees and you have to work your way back up again. Right. And so I think we're going to see more and more of this, maybe not in the next year or two.

7:15But I think we're going to see more and more decentralized models because, you know, technology is becoming more. It's enabling more and more people to become entrepreneurs or entrepreneurs in business. So that is it for today. Please don't forget to rate, review, subscribe. And we will see you tomorrow.