2072 – How to Leverage Technology for Growth and Efficiency with LaCorte Ventures’ Blair LaCorte

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1:05With us right now is Blair LaCorte. Blair, you are the managing director of LaCorte Ventures. And for today's interview, it's kind of funny, Blair, you and I were talking beforehand. You're kind of the Forrest Gump in business just because of all of your life experiences. But for this conversation, let's give the website as ppmastermind.com. Blair, it's great to have you. Hey, Josh. Thanks. It's great to be here. You know, I love the fact that you, you know, cherish the fact that I've had such a bizarre career trajectory. Thank you. Yes. And it's all part of that. Like, you know, when we look at, you know, it's amazing.

1:48I think so many of us in business, you know, we look at where we currently are. And oftentimes it is kind of this amalgam of all these diverse experiences. You know, I did a little bit of that. And I used that from time. I did this a little bit. And it's like, we kind of find our way in the world through, you know, just continuing to show up and build these relationships and use what we've got in that moment. I love what you're saying. Look, we all want to actually have some story in some sense that we have a control. But in reality, I think it's 50 percent we have intent and 50 percent we make the best decisions we can and opportunities open up.

2:23And I think that's the, you know, anyone who's an entrepreneur, if they really look at it, realize that, yeah, they had a vision, but they also pivoted three times because they were in it. Right. Right. Blair, you have been an active investor or engaged advisor to over 100 companies. Do you mind maybe just sharing a little bit about your bio, your work, who you've served and kind of what you've done, particularly over the past five years or so? Sure. I mean, really, Josh, I have, and maybe some of the listeners would relate to this. I have maybe four acts. I'm hoping that maybe I'll have five.

2:58But in my first act as a youngster, I had two divorced parents, both entrepreneurs, both had their own businesses. My dad was a recruiter. So service business, my mother and my stepfather had a startup airline, which was a big asset heavy business. Many people may have seen the show wings, which was partially based on my family. What I can tell you is that they were better looking, but we were a lot funnier than, than they were. And so I got to see, you know, the struggles of building a business, one in the service industry, one in the asset business, because once you own helicopters and planes, they got to fly.

3:33They eat fuel and they're big pieces of metal that have to fly. And so that was really the first part of my career. And what that taught me was I was terrified of having to eat what I killed every month. And I went back to college and got a degree in business. Then I went and got a, I went to GE and went to a training program for two and a half years in business. And then I went back and got my MBA in business, only to find out that that second act led me right back to where I was before, which was, you know what, when I got out of my MBA, I went into change management, working with businesses to figure out how to actually either restructure them or to grow them.

4:12And a lot of people would think that's two different things. But in reality, when you restructure something, it's because you've got to make a lot of changes because things aren't working. When you're doing a growth company, even though the business is doing well, You can't double it. You can't triple it unless you break a bunch of things because it's got to change. And so, you know, my conclusion was, you know, it all really comes down to, you know, change management, how you can take people and lead them through the process. The fourth part of my career was I got lucky and I got sucked into high tech.

4:46I thought I was taking a job with Sun Oil. It turned out to be a company called Sun Microsystems, which some of you users may know was one of the pioneers in the hardware business. And I just showed up and I faked it. And, you know, I had a big career in high tech. And then I was able to run a defense company. I migrated on to be a partner at one of the three largest P firms. So we bought about 100 companies from Burger King to Alcoa to Washington Mutual, unfortunately, you know, to IBM, which we merged with Lenovo. So did a lot of change management as an investor. And then finally, I went back out to run businesses and take what I had learned in my career.

5:28So I ran the world's largest private airline, the world's largest live entertainment technology company. So I ran about 80 % of the concerts in the world, the Academy Awards, the Oscars, the Super Bowl, the Olympics. And I also went back to do autonomous cars and develop technology for that. So that really was my career trajectory is there is no through line unless you realize that it's all about people and patterns and learning. And so where I started as an entrepreneur with my parents is where I really ended up, which is if you're learning every day and you're trying to figure out how to solve problems, you can have fun doing almost any industry, right?

6:14Yeah. Today, I would imagine that there are likely some things that you have been hearing among the leaders that you get to work with. We'll talk a little bit about the masterminds in just a second. But what are some of the concerns that you're hearing from executives and leaders today? Yeah, well, I think that there's three big things that people are worried about. Now, again, it depends on what size the company is, but it's a different flavor of it. But the listeners will know there is a struggle. There's a struggle culturally with what is it to go to work. Now, that can manifest itself in remote workers.

6:55It can manifest itself in, well, my employee says they want to have a purpose. And what do you mean want to have a purpose? Your purpose is to come here and figure out how to do your job. There's this whole idea around how much pay is enough pay and how much flexibility is enough flexibility. So all of them, whether you're in a small company or a big company, are dealing with the change in the way that culturally we're looking at what work is. and especially when you take a look at Gen Z, because remember, they're designed over time to do the opposite of what we want to do. So if we were dedicated and working really hard, they're thinking, well, let me look at the opposite of that.

7:33I want to work really hard, but I want to work my way. So that's one of the big ones. The second one, obviously, inflation and how do I actually deal with the price of my goods coming up? Or conversely, what am I doing with supply chains? How do I order things? The world, the global economy is changing. Supply chains are changing. A lot of issues with China. And then the third piece is really about this transition. Every product, if you really step back and look at it, starts out as very unique. And then it becomes commoditized. And then you've tried to figure out how to package it better. And that becomes commoditized.

8:10And then you figure out how to deliver it better. And that becomes commoditized. there is so much information on so many products out there today that it is really difficult, unless what I will say is go back to the future, that you focus on the customer and not necessarily always on your product being the answer. How you deal with your customer and the relationship you have with your customer, because part of delivering a product, now in a service, obviously it's 100%, but even in a product, it's their relationship with you that actually has a big impact on why they want to buy from you. So, well, you know, 50 years ago, it was always about inventing new things.

8:47Today, it's about getting those things to the customer and what your relationship is with them. So I would say that's the one that I think is hidden, but it's a gem if you focus on. Indeed. Yeah, absolutely. You and I talked briefly before we hit record, and you'd also mentioned AI, which, you know, obviously is impacting organizations, operations. What are your feelings on, you know, kind of stepping at the right pace for our particular organization when it comes to AI? Some people might feel like, you know what, we're just kind of behind the, you know, we're behind right now. Like, I feel like we should be doing more than you have other people that might be being a little bit too risky.

9:31You know, how do we know that we're in lockstep with where we should be when it comes to some of these, I don't want to say disruptive technology, but certainly innovations that could potentially be huge. But, you know, again, the fear is if we're misusing it or using it inappropriate or we're being too fast, there could be some operational risk or, you know, some sort of, you know, risk to the organization as a whole because of these experiments or some of these big decisions that we make. You know, it's always, you always want to, you want to hit that sweet spot, right? You know, Josh, I think you actually described it the right way.

10:05Let me try to say it in different words. Look, I just hosted a panel at, you know, a very prestigious AI conference. It was for Dartmouth. And most people don't know, Dartmouth actually invented the term AI, you know, back in 1956, right? And I went to the audience, I had them put up their hands. I said, who has been to an AI conference in the last six months? And almost everybody in the room had either gone to a seminar online or gone to an AI conference. So a lot of interest in AI. Then I asked how many people actually have a project that they think is actually AI related and that they're struggling with that.

10:43And there was another 75 percent. Then I asked everybody how many people have used ChatGPT in the last two days and 90 percent of the people. My point being, this is just IT. This is just IT. When PCs came out, it was a big change. When databases came in, it was a big change. When spreadsheets came in, it was a big change. The way I'd like your listeners to maybe think about it differently than rather than start with what is AI, start with I use technology to either reduce costs, to increase revenue or to increase productivity. And so you have to ask yourself, you always go through a three-step process.

11:21One is mechanization. The other is automation. You make it more automated. And what we're dealing with now, AI is just a different form of making things more mechanical or automating them, but it's using data to make decisions. That's really what AI is. So whether you call it an algorithm, whether you call it machine learning, or whether you call it a simulation, all it's trying to do is what your brain would have done before. You would have looked at your spreadsheet. You would have realized that you've got four customers that give 50 percent of your revenue and that if you lose one of them, you're screwed.

11:55And maybe you should change your tactics a little bit so that you, you know, tie them in. What AI is trying to do is use that data, but be able to give you recommendations. So I would say that everybody on this call will use some form of AI, because if you're going to automate something, you know, like so, for instance, the other day, I had to write a job spec. And I went to ChatGPT and I put in the five things that I thought were important about this job. And I put in a little paragraph about what I was hoping to find. And then AI came back and wrote me a job spec. Okay, it wasn't perfect, but that would have taken me, you know, two or three hours if I had actually gone out and tried to go through the different things and looked up different, you know, words and things like that so I could give it to a recruiter.

12:42So we're all going to be using AI. And to your point, the biggest challenge is not going to be whether you'll use it. You will use it. The biggest challenge is what you do and how fast you do it. So there's just as much risk as trying to do too much as there is doing too little. AI is not the solution to every problem. Now, one of the things I talked about in the conference was, you know, if you looked at it two years ago, they said 75 million jobs would be eliminated. They weren't, okay, in the last two years. That doesn't mean that jobs aren't changing because of AI. You have time. But if you don't engage and understand, it's just like when, if I told you right now, you're running a small business and you can't use an Excel spreadsheet or a QuickBooks, you'd say, I can't run my business.

13:26But before they were out, everyone fought it. They fought it. So don't fight this. Think about what things in my business do I think I would like to automate? What things in my business do I think could bring me more revenue? like going through and actually putting out marketing material? And what things do I think could free up time in my people so that they could do better things? Then you start to look at the AI technologies. But it all starts with what do you do every day that you want to be better? This isn't like there are some businesses, right, that will change completely. 20 % of the businesses may go away, but you're probably not in a software coding business.

14:06That business, an AI system can look at a lot of code and write better code in a lot of cases than a computer scientist. So you may, if you're in that business, you're going to pivot your business to having one great coder, and he's going to be using AI. And three of the guys may have to move to doing something else, right? So really start with what you'd like to fix, and then let's ask if AI can fix it. Yeah, great, great, great, great point. Blair, your website, mastermindinnovate.com, do you mind sharing just a bit about that? Sure. When I stepped down as a public CEO, I decided that I would break up my life.

14:48We all get pushed and pulled into things through our life. And I thought, this is a time I can decide what I want to do. So I broke up my life into two pieces. One is investing and starting up businesses. And the second is coaching. So the Innovate website is really the coaching group that I have. We have about 40, depending on the meeting, 40 to 50 CEOs of businesses, somewhere between $5 million and$200 million. And we bring them together. And what you find is that we have 40 different industries out of 50 CEOs. It's amazing how we can help business owners help each other, even if they're not in the same business, because it all comes down to patterns and people.

15:28And so we try to figure out how to use lessons from one industry in another industry. So for example, in one group, they were looking at introducing a new product and they needed to figure out how to source the material. They had never used a reverse auction before. They had never, in other industries, we've been using reverse auctions for 20, 30 years where you basically put up what you want and you let people bid until the lowest bid wins. Very different than a regular auction, right? But if you're going after suppliers and it's a commodity type product and that you can ship it from anywhere, why not let people bid against each other?

16:07That was revolutionary to this one company, yet it had been done for 20 years. And they think it's gonna save them 20 % on their supply chain. So it's sometimes little things that when you see a pattern and then you apply it, you're the only person as a business owner who can tell whether it's going to work or not. But we can help you figure out the ideas to test. Yeah. So for someone that maybe, who would be, like, who should be checking Mastermind Innovate out? Look, I think that the people that come to us, and we don't have a lot of space right now because we'll never be over 50 people, but there's always a couple slots because we have some success in the sense that one third of the reason people come is they want double the size of their business, and they just need to figure out how to break through that.

17:00They're between 10 and 75 million at the lower end, and they want to double the size of their business. The second group of people, they're looking, they're an operator owner, which means they're spending all their time in their business and they'd like to transition back a little bit and they'd like to figure out how do I get someone else to run my business without destroying it? How do I become an owner, not an operator, right? And then the third group is really around how do I actually live long enough to enjoy what I've built, which is we talk a lot about health and things you can do. We talk about relationship and we talk about, you know, how you actually deal with your family and whether you bring your family into the business or not and how you deal with that.

17:41So those are the three reasons. But most of the people, I'd say the bulk of them are 25 million to 75 million dollar revenue companies, enough that they have a business there. Some at the low end and we got a couple billion dollar guys. But we had a few people sell their business this year. And so we're very happy. In fact, we brought one of them back. We're going to give them a big award because we should celebrate. This was what they wanted to do. They had a three year plan that they wanted to migrate out. You know, and we helped to migrate out. I think that they're going to end up buying another business because once you're addicted, you're addicted.

18:16Yeah. Very happy right now and spending a lot of time traveling. Yes, sit on a beach only lasts. It only maintains its interest for so long. Especially if you're, this is a husband-wife team and they love working together. But I'm not sure they're going to love spending all that time together without having anything to talk about. Yeah. Because that's a different relationship. I love it. Again, Blair LaCorte, thank you so much for joining us. You're a managing partner of LaCorte Ventures and co-founder. It's been great, or founder of LaCorte Ventures. Blair, it's been a great conversation. Thank you so much for having joined us.

18:54Hey, Josh. Thanks. Take care.

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