You Can’t Scale Chaos: The Systems Required to Reach $100M with Jeb Blount

0:00The work that you do to get from 10 to 25 can carry you to 100 million. But if you don't believe that you're a$100 million company, you're going to hit a wall, you're going to stall, it's going to drown your momentum, and you're going to get super frustrated, and you'll never make it. With salespeople in particular, sales teams, you've got to move fast. By the way, the pace, because of things like GBT and all of the AI, everything is moving so much faster. But scale is about momentum. So, Jeff, get to$100 million. Mindset, attitude, what got you there? What gets your clients there? So the biggest problem for people who want to move from where they are now to cross$100 million is being able to see themselves as a$100 million company.

0:42And that sounds weird, but I'll go back to when I was in my early 20s and I was working in a big company, big Fortune 500 company. One of the best bosses I ever worked with said, because I said, I want to be this. I want to be a vice president of sales. He goes, you need to be able to see in your head and in your heart that you can be the vice president of sales. You need to start experiencing before you get there. I think that what happens is people say, I want to be a$100 million company, but they do not have the ability at that moment to accept themselves as a$100 million company. So once you get past$25 million, you can get to$100 million.

1:19It's a lot. I'd argue it's a lot easier to get to$100 million from$25 million than it is to get to$10 million from$2 million. Yeah, I think that the professionalization that has to happen from$10 to$25 will carry you to$100, as long as you don't market size, market presence, that sort. But the problem is, is that if I can't look at my company in the boardroom at the strategic level and see it as a hundred million dollar company as the leader, right? As the CEO, the owner, the founder, what have you, and then draw that picture for everyone else. They don't know how to get there. Yeah. And so the biggest issue is having someone, the owner who says leader, who says we're going to get there.

2:00That's the mountain we're going to climb. because once you can get people emotionally connected to that future state, the next step is to actually say step one, step two, step three, step four. Sometimes you need a coach to get you there. And a lot of times you do. You need outside business people as a consultant. That's when we'll often get pulled into a company when they're saying, okay, we know the vision. We need to get all the pieces in place. And so in our world, like as consultants to help people get there, we're more of an extra set of hands. So we don't have a dog in the hunt, so we don't get emotionally connected to the current stake and you'd hold them back, right?

2:37When people say, well, we've always done that way. We're saying, like, you want to get to$100 million, this is what you have to do. But you need some help to get there. But I think that the biggest thing is, this is my opinion, but I think you have to be able to say, I want to be a$100 million company. It's so different than clients that I work with now that are$500 million companies that say, we're going to be a billion-dollar company. and that is a really hard leap. Like going from a half billion dollar company to a billion dollar company, it's almost in the lead between a million and 10 million.

3:09You have to like almost remake the entire company. The 100 million, like you said, the work that you do to get from 10 to 25 can carry you to 100 million. But if you don't believe that you're a 100 million dollar company, like you start acting like a 100 million dollar company, you're gonna hit a wall. You're going to stall. It's going to drown your momentum. And you're going to get super frustrated. And you'll never make it. I remember three years ago, I said to the team, all right, hundreds of millions isn't good enough for us. We're going to go for three billion. And they all looked at me like I was nuts.

3:41And now, 18 months later, the research is done. The planning is done. The IT systems are being rebuilt. The brand is rebuilt. All that sort of stuff. Now they're sitting there going, I think we can do this. It's like, you know, I had to believe at first, though, as you said, if you as the owner or CEO don't call the shot, no one's going to try and grapple with that. It truly is. It's Babe Ruth sitting at the plate, pointing in the stands and says, that's where the home run is going to go. Now, what you did, though, is you said, OK, we're going to be a$3 billion company. And you recognize that who you are today will not get you to$3 billion.

4:17So you have to say, I got to rebuild everything. And in my own business, that's what 2026 is going to be about. We are, I'm stopping for a minute and we are going to spend 2026 re-engineering the entire organization so that we can make the next leap forward. Otherwise, we won't get there. Yeah. I told Jeffrey Gittemur I was going to do it and he turns to me and he says, you know, you're no longer in that book, Good to Great. You're now in the book, Shit to Okay. And it was like typical Jeffrey trying to boil it down to the basics. But, you know, technically everything that's great for a million will stop you getting to 10.

4:51everything is great for 10 will stop you getting to 100 and everything is great for 100 will stop you getting to a bill you know and and i think that yeah that's psychology though but when someone when you're coaching someone and they're not willing to see it yet any particular things that help get them to see that they can go to that level yeah i think i don't i guess so let me try to answer this the right way because i'm i'm trying to think the right way of saying this just people want i cannot create that belief for someone like they have to be able to do that so as a consultant if someone says hey we want to get to 100 million dollars and we're working with them and their actions aren't congruent with their words got it in those situations i can ask the question you say you want to be here you're doing these things is that what you really want yeah Because your actions aren't demonstrating that.

5:51So I can create awareness that what they're actually doing isn't going to get them where they're going to go. But there is nothing that I can do to get – and it's not my job as a consultant to get attached to someone else's future. In fact, that's a really bad thing for me to do. But if they don't actually believe it and I can see it, I can say, look, I think you can be a$100 million company. I think you can be a billion-dollar company. But if they don't go, you're right, I think that's what we should do, I'm not going to be able to help them get there. I remember as a young man having to pay market research firms to sort of validate your thinking.

6:25Today, you know, agent mode or deep research mode on GPT, and they can start to see it. I had one client, and they are a$40 million business in one location. I said, just do the research. How many cities in America are the same as the city you're in right now doing$40 million? And it took them a month or so to do it. They used GPT, used other things. And they came back and said, Brad, there's 83 cities in America, the same size, structure. You know, there are just 600 ,000 people town. And I said, so technically you could be a three point something billion dollar company if that's what you chose.

7:00And it takes a bit, though. I think that you can build and tell me your thoughts on this. I see people building a one or a ten million dollar company. You don't really need much market research to do that. To go to 100 or a bill, you need to go and do an analysis of how much gold is under the ground type thing. Yeah, I think that would be a great example if someone says, I want to get to a billion dollars, and we want you to help us get there. And I'm looking at it going, okay, well, where's it going to come from? That I think is important. I've got a customer that I work with out in West Texas, and we're looking at their marketplace, and we know where they want to go.

7:41But there is a limit to where they're going to grow there. So their ability to scale is going to come from buying other businesses or moving into other markets or plugging in adjacent businesses in. Because if they want to get to a billion dollars, they're not. Yeah, dude, there's only a billion total gross value in your market. So I know we ain't getting there in this. You've got full competitors. You're not getting 100 points of the market. So you can't be delusional and successful at the same time. So you need to wipe that away. But I go back to if I said this is what I want to get, I want to be a$100 million company, then I can work backward from that vision to get there.

8:20But if I don't believe that I can do that in the first place, I'll never take the steps to work backward. I'll just keep keeping the plate spinning in the air that I'm already keeping going. I was trying to work with someone the other day, and I was trying to show him that, look, you can do organic growth all you want. We got to buy some companies. He's like, but Brad, I can do the marketing. I said, yeah, and the marketing takes how long? And he showed me, and I said, so it's a two-year growth plan. Acquisition, we find it, we buy it, we've got the 10 ,000 customers in that marketplace on day one.

8:56Why do we want to go organic? strategy for going big. I think that, and I'd love to see how your thoughts are. I think that when we try and get people to understand there's a different strategy to go hundred and bill, how do you get people through that? Or what are your thoughts? Do you ask them a lot of questions? Where do you go with that? Well, I think exactly what you said. Look, we're going to do some research on this. We could do this organically if we set up businesses in these different cities, or could we find, do the same research and find businesses that are like ours that are in those cities that we could take a look at that we either buy and plug in or maybe they're broken in some way and we've got a better system that can fix them.

9:42And those cases, when I'm working with clients and I'm working with one right now that wants to grow through acquisition, the first thing we have to do is fix the inside of that business with a system that they can, when they buy something like the board from Star Trek, they can immediately assimilate it because it's a good analogy. Because the worst situations I've ever seen, and I actually have been involved in Cubbies Who Did This, is you go buy this business and then it floats out there because you don't have systems to plug it in. And they either destroy your culture or you destroy their culture, but it takes forever and all of the growth potential just dissipates because you didn't have a good plan.

10:23So I think that – But just on that, why do companies not – why do they still call things a merger rather than a takeover? You can't merge. You have to take them over. Take them over. It is you're now in our system. Here's how we run our system. And we're plugging into your system because we're better than you. Yeah. And if I'm – that's different than a strategic – I could do a strategic acquisition because they have some knowledge base or a group of employees. or something that... Bordecai, a different sort of strategic buy 100%, but if it's the same industry... If I'm buying to grow, it is...

11:01We come in, here's the book. This is how we run the business. And here are the choices. You can leave or you can do it our way. Well, let's go back to that thing on systems because you can't scale chaos. So obviously you're the master of sales. What's the distinction between... How do you help someone realize they don't have a sales system, and they just got salespeople. Oh, well, that's pretty much most businesses. Yeah, it's like, well, you have a salesperson. That's how. Then, okay, give us the distinction between salespeople and a salespeople. Well, maybe let's be kinder than that. Everybody has some sales system.

11:40Whether the sales system is complete chaos or it's something that they've dialed in. The question really is, do they have a system that allows them to maximize the ROI on every sales head. In other words, that sales head is producing at a level that is higher than what I've got now. And the ability to add more sales heads in as I grow without losing that ROI, right? So I'm not gonna cannibalize the other sales people. So when we talk about sales system, we're talking about a lot of pieces, right? Your recruiting system is part of your sales system. Your onboarding system is part of your sales system.

12:15How you go to market, like what type of a sell are you in is part of the cell system. And the problem that we have is in some cases, especially with founder-led companies that are scaling up, is that the founder is the savant that has the ability to close anything. And the founder has a system, but he can't explain it to anybody else because no one else can figure it out. And it usually sounds like this. Hey, this is really easy. Just go do it. That's the system. Well, I remember as a young man, there was a point in time where I realized I didn't have a sales system. I had a sales idiot, me. I did them all.

12:54And it took me several months to start documenting what I did, why I did it, how I did it, all of that sort of stuff and building that. You said something interesting there, though, that I hadn't heard it put that way before. They're not going to reduce other people by adding sales people. Tell me more about that. Well, let's like an example. So one of my clients, Sir Wormlow, 12 years ago, brought us in because they wanted to scale up. They wanted more. And their average salesperson was selling about$300 ,000 a year. Today, their average salesperson sells about$450 ,000 a month. Think about the difference there.

13:34The difference was that the ability to sell$450 ,000 a month was already there. The market would carry it. They just didn't have a system to get there. And that was little things, right? Okay, so it was recruiting. So my recruiting the right people. Their training program was nonexistent. So you bring people in, plug them in, sit them next to someone else. So it's taking you a really long time to ramp that person. You don't have a process for knowing whether the person is good or not in a very short period of time. They didn't have a good sales compensation program. So they were incentivizing the wrong things.

14:11Their salespeople really didn't have a good process of taking an inbound call because it's an inbound sales team, vetting the customer, doing qualification, moving them through the process, closing the deal in the first shot, or following up going down the road. And we can go from there to there. They did have a good leadership team. And they had leaders who were selling and were leading, which is a really bad thing. So it took a while. I mean, it took a couple of three years of work to get all those pieces in place because there was no way you're going to boil the ocean all at one time. And by the way, making that shift, we couldn't lose the sales that we have while we were getting to the new model.

14:46So these days, if you're selling$300 ,000 a month, they think that you're terrible. Like you're art. You're fire. And some people on the team are selling$500 ,000,$600 ,000. So that's one set of that, one type of system. I'm another client. When I met them, they were doing about$800 million a year in sales. Their biggest problem in their system, good company, great company, great product, was it was taking 18 months to ramp a new rep. Damn. Yeah. Long time. Now, we looked at them and said, you can do this in 90 days. And they looked at us and said, there's no way. You've lost your mind. And so we started working with them.

15:28And we run like a Six Sigma process on their ramp time, take out all the variables. and a lot of it was just these embedded, you have to do this here, here, and here. My thought was, all we need to do is teach them how to sell as fast as possible and then we can start filling in the other pieces. What does it make a difference if I teach them something on day two, right? Yeah. That they can't use until six months from now and by the time they get to six months from now, they won't remember it anymore. So what we did was create a system for bringing a new person on and get that person selling faster.

16:01Now, for a business that wants to move to$100 million, this is important because when you ramp salespeople faster, not only do you create revenue at the top line, but you also draw profit to the bottom line because you're not wasting time with people. And you start moving people way fast out of your system that are making it. So firing people is a system. So when you start thinking about this whole process, there's all of these bolt-ons to system and the sales team. But the biggest thing you got to think about as a founder is, can the sales organization run if I didn't show off the work for a year?

16:39Yeah. Because you've got good leaders who have a set of SOPs. You have playbooks for your salespeople and you've got playbooks for everything that you do. You've got an HR team that is completely dialed in. And then you can plug people into your team and you can scale to the market's ability to let you scale without taking sales away from other people. So that system has to tie directly into marketing because your marketing team at some level has to be able to create leads. You may not be able to create leads that will cover everything. but if you're scaling up it's suddenly your leads didn't keep up with your sales people hard to bring on new people drop them in that slot if you can't feed them a little bit so um so as you start thinking about scaling you're not going to get 100 million dollars without a sales team unless you're in some sort of a retail program where you're just doing e-commerce so but you can't think oh we have a sales process you've got to think how have we got this entire team organized?

17:41And by the way, what's the mechanism that allows us to iterate really quickly as market conditions change on things like compensation and how we even do the span of control with your leaders? Does that make sense? It makes a lot of sense, but you touched on something that I think very few people hit on with scale, and that is speed. Because people don't realize scale requires speed. Take me more into that comment. Yeah. So the thing about sales organizations is they have to move fast. And by the way, the pace, because of things like GBT and all of the AI, everything is moving so much faster. But scale is about momentum.

18:23Like as soon as you start stalling out, think about it. Let's go back to just a mindset piece. As soon as you start stalling out, you get frustrated. Your people stop believing that they can get there. And the whole thing starts to collapse. And the worst thing you can do when you're trying to scale is stall. Now, you will stall. Everybody will. Everything stalls. But I want to know when it's going to stall. So I want to predict the stall so that as the leadership team, it's stalling here, the people who run the company. We're already here thinking about the next$100 million guy. And we're in the boardroom figuring out what the strategies is going to be there.

19:01But with salespeople in particular, sales teams, you got to move fast. And moving fast means with new salespeople, I need to get them ramped fast. And if they're not going to ramp fast, I need to get them out fast. And then especially when you know you can capture market share because your system's working, the marketing's working, the branding's working, everybody's energized, your competitors are caught flat-footed. And you've got to be able to plug new salespeople in as fast as possible and have them selling as fast as possible. So when the sun is shining, you're making it. You said something in the middle of one of those comments there where you talked about the owner being a savant.

19:40Yes. And I hate to put it bluntly to owners, but there are a lot of owners who, let's just say they stop their own company growing. They become the limiting factor. I've just agreed with my team to hire a CEO and step into the chairman role because it's like, I need to hire a professional CEO. Where do you see that happening most? Or how do you see that? And how do you see owners actually getting to the point of, yes, I'm going to admit and I'm going to hire or grow? It is so hard. I know. Trust me. Because we work with a lot of family on companies. We run into this a good bit. And sometimes people can tell this owner that has built this massive business.

20:34I mean, you're a hundred million dollar business. That is a massive business. You started someplace, blood, sweat, and teared this thing all the way to a hundred million, however they got there. And then you got to go sit in their office and go, you're, you're holding your company back. And, and I know those folks and hopefully my clients I know who you are. They know who they are. And the problem is that if I'm the consultant telling them to do that, I mean, they may hear me, but it's probably the last day I'm going to be their consultant. So I think that what we all need is we need people around us who are telling us the truth that we'll listen to.

21:13I know that we've got, I mean, I'm a business that runs the same stuff. and I've probably got about three to four more years where I'm going to be able to be the person that's leading our company but at some point and I'm already thinking you know I've got I'm going to have to hand the reins over to someone who full-time can think about where we're going to go and think about bigger things than I can think about because you know I'm stuck in yeah I've built this thing from the ground up I was the guy that was you know sitting in my office all by I'm going to sell if one person making cold calls, calling everybody I knew.

21:50So, you know, do you need some sales training? Yeah, we won't even a million dollar. You helped me when I was there. Yes. So I think that it's the awareness factor. Now, sometimes it happens because the owner decides to sell to someone else, right? And then they're still in the business. Well, you're going to make an exit, right? Yeah, every one of us is going to make an exit. We choose to either pine box it, shut it down, or go the two positive routes of hand it over to someone that will run it for us or sell it on to someone. And I think you're right. The selling it to someone makes us understand that if it can't run without me, I can't sell it for decent money.

22:31That's exactly right. So sometimes you get that wake-up call. The problem is that founders are crazy. Nah. I mean, a lot of them are just nutjobs. Yeah. And I'm a founder. That's what makes us successful in those cases. I know, but it's the thing that when you start thinking, I want to get to$100 million,$200 million,$300 million, okay? Let's say that you're going to grow your business that way. You're not selling it off to a PEE. You're not going to be a platform company. You're going to plug other people in, use other people's money. You're going to actually build your business to that level.

23:07It does take a certain level of crazy to get there. The problem is, and you said the word chaos. The problem is that crazy people have a tendency to create chaos because kicking over ant piles is how they grew the business in the first place. If you don't have the ability to dial that back, to change that, then your company's going to suffer. And my litmus test for crazy is this. So we work with a lot of private equity companies that come in to help us solve sales problems. And when the founder of the company who is still working there hops on the first call and they're on their phone walking down the street or they're in the back of a car or they're on the beach or they're someplace else on the phone, that's my litmus test for, OMG, this is going to be a struggle.

24:00Yeah. Because that's how they've always done things, like just completely on the fly. and it's always the same outcome. And then when you get the one that they're on, they're professional, I got a team around them and they're like, okay, we're ready to figure this out. It's a little bit different outcome for those individuals. I know that's a weird generalization, but if you're that person who says, I can be this different than everyone else, that's who I am, that's what I'm going to be. And you want to scale that big, you're going to struggle getting there because at some point, we start talking about systems and processes, there has to be some conformity to that.

24:45Yeah. I look at, and one of the best examples of this in my mind is the Microsoft example of Bill Gates had that visionary thing, tried to get other managers until they bought in a professional CEO with Sachin Nadeau. Like you had to bring in a professional CEO to do that. And I think it's sometimes is hard. I like to teach founders that one day you get to be promoted to chair and chair means you get once a month to come in and see it. And once a month on a board meeting and once a day, I think by giving them the word promotion, I can sometimes convince them to that thing. Flip it over just one sec.

25:25Top two or three things that stop a company scaling to$1 ,100 plus. You do not understand your finances. So you can't scale if you're not making money, unless you're using someone else's money to get there. And that's a completely different am of that. You've got some DC that's throwing a bunch of money at you and just burn it. That's fine. Those days feel like they've been over for a while. But I always say the number one thing is you want to scale up, but you don't have a really good understanding of your P &L, and you wake up one day and you're dealing with negative cash flow, it is going to put the brakes on very, very quickly.

26:01Number two is the inability to pick a lane and then iterate inside that lane. And what I mean by that is, okay, you're a company, you want to scale up. And let me give an example from a sales standpoint. You have a marketing organization that's spending a lot of money to generate leads, but in order to scale, there's no way you're going to be able to pour that much money in the lead generation without your salespeople doing some of the heavy lifting on their own. So you realize that and you say, okay, well, we're going to have to start doing some outbound prospecting, cold calling, very, very hard.