Darius Mirshahzadeh: How Core Values Unlock Massive Business Growth | Entrepreneurship | YAPClassic

23:18It shrunk to 100 ,000 by 2011. Wow. So three quarters of the industry went away. I always said it'd be kind of like, most people don't know this, but I said, it would be like, if I said, Hey, Uber, Twitter, Meta, Google, they all go out of business. That's what happened to that industry all at once. So it was brutal. I pivoted. I pivoted for almost five years. I literally showed up to work for five years straight, 07, 08, 09, 010, 011, and literally did not get a paycheck. I just cut checks and went to work. Now, I'd made a lot of money in the previous year. So we used that to survive. But most of it, we spent a lot of it and just trying to rebuild.

23:57And it just took a long time. And I was young. Mind you, I started the business in 03 when I was 25. So by 07, I was 27, 28. So this all happened before I was 30 years old. And then I spent my late 20s, early 30s rebuilding, figuring out what was next. And I have a friend, Ryan Levesque, who owns a company called The Ask Method. He called me Tenacious D. He said, you just don't have any quits in you. And I was like, man, I wish I did. Because it was probably the most painful five years I've ever lived in business. And I wouldn't do it over again. If I had to do it, I wouldn't. You're saying that you wish that you shut down that company earlier, that you just were beating a dead horse basically for five years?

24:40So Naval Ravikant says you need to pick the right space to be in. And that space was a dead space and it was broken and I just couldn't win in it. But I just didn't have any quit. So I just kept fighting for it. I was standing on a broken foundation. So knowing what I know now, it was there was a lot of time and anguish spent and there was opportunities all around me that I was, I was living in San Francisco. So what was happening in 09, 10 and 11 in San Francisco? Airbnb, Uber, you go down the list of all these amazing companies that were born then. And I'm over here getting my teeth kicked in, in this space that's just demolished.

25:16And so was it the right thing to do? I don't know. Hindsight's always 20-20. But yeah, the pain sucked. It just wasn't worth it. I had some amazing things happen to me during that time. I had my first child, and I got married, and I did live in a great city. But professionally, I struggled so badly for so long that it just, it wasn't fun. And I think that there's an element of grit to win. Like in order to win, it doesn't always come easy. And you have to have some thick skin and you have to be willing to overcome obstacles. But to a point, I was very depressed during that timeframe. And I just couldn't get out of my own way.

25:50And I learned a lot about how do you how do you reengage to activate yourself if you get stuck. So I learned a lot then about that. And the big thing is you have to win a little bit. You can't just lose constantly. And for us, because the foundation of that industry was broken, it was a ton of false starts. It was like five false starts. I probably started seven different companies then, and I just couldn't get any traction. But eventually, you know, Tenacious D worked. We had a really big win in 2011. And then our biggest win was after that in 2013, which is the business I just exited a year and a half ago.

26:23Yeah. So tell us about The Money Source. So I want to understand how you ended up creating that business, how you grew it to a thousand employees, how you exited. I'd love to learn more about that.

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30:30Restrictions apply. Services not available in all areas. Yeah, so because I didn't have enough capital and mortgage, you need to have capital to build your platforms because it's not like VC. VC, you use capital to burn your runway to then get to your next round of capital mortgage, you need to capitalize the platform to go lend against it. And so I didn't have enough to really do it competitively. So what I ended up doing was doing partnerships. So I did a partnership with this company called Pacific Union Financial in 2011. And we grew it from essentially nothing to about 75 million in revenue overnight.

31:02We had not a perfect exit from it. We had a disagreement with some of our partner there. And we ended up basically getting bought out, had a very short non-compete, took all that capital, and went out to go buy a platform, raised 40 million bucks. And we couldn't find the platform we wanted. One of the platforms we were talking to to buy was this company called The Money Source, which was this really small little company in Long Island, New York. 30 employees, a couple million dollars net worth. There was a small little regional lender. And he said no to selling to us, this guy named Stavros, who ended up being my business partner.

31:36But he said, well, what if you want to do a partnership? I said, oh, hell no. I just did a partnership and I'm not doing another one. But after a while, we couldn't find what we wanted. We go back to them and I said, Hey, listen, the 40 million bucks we raised it, I didn't call capital on it. I just went and did a partnership, but I made it this like bulletproof partnership agreement so that what had happened in the previous deal wouldn't happen in this deal. And it was off to the races. This business grew from, yeah, it was like a J curve. Like we went 30 to a thousand employees in three years.

32:04And it's a complicated story, but essentially we crushed it. I mean, the business now is one of the largest lenders in the United States. It manages$100 billion of mortgages. It's a game changer in the mortgage industry. And we built that from the ground up. I mean, there was something there when we got there. They had their licensing and they were a small company. But there was a company that had grown from nothing to call it 30 employees in 17 years. And then in three years, it went from 30 employees to 1 ,000. So that kind of shows you the difference of what happened when we all got together.

32:35Yeah. So question for you. You've had many different entrepreneurial experiences. would you say that you would have been as successful at the money source had you not had those other failures previously? I don't know. It's hard to say. I mean, obviously, like you fail till you win, right? And you learn in the process and winning is a failure mitigation game, right? It's how do I reduce the failure to get to the win or reduce the speed or speed from fail to win, right? Yeah, we learned a lot. What I learned at the win before that, I took that blueprint from there. And I brought it over to this next place.

33:10And there was a lot of pain to figure that out there. So had I just gone straight there, I wouldn't have known what I knew. But yeah, I mean, look, you either grow or die, right? It's like, there's no real middle, you either give up or you keep fighting. And for us, you know, I have no end of fighting me. For me, it's like, I, if I'm not getting what I want, I will obsess about it. So I either figure it out, or I figure I don't want it. Right? Oh, my God, that's what's going to take for that to win. I'm not doing that. but like i'll make that decision but i won't make the decision of like oh i i didn't do well like i guess i suck like that thought never crosses my mind it's like all right i just don't know enough yet to win so i gotta go figure it out but yeah we figured it out and like i said like you don't build a hundred billion dollar mortgage platform without literally from startup like not startup but from very small and by the way we did it bootstrapped we didn't raise capital So we would go, once we got it big, I'd be on Wall Street.

34:06I'd be meeting with JP Morgan and Bank of America Merrill Lynch and all these investment bankers on Wall Street. And they're like, so tell us about how did you guys raise the capital to do this? I'm like, we made money. And they're like, how did you do that? I'm like, magic. I mean, what we did is, I cannot give you one example of any mortgage company in the whole country that did it the way we did it. It was a cool ride. And one of the biggest tools I used was building a world-class culture. Yeah. And I leaned into that. And that industry was lacking because of what had happened in 07 and 08.

34:40It was like a graveyard for culture. And I was all in on culture. So that was one of our secret weapons was how do you leverage culture and scale systems and do these best practices that are maybe in other industries are not in this industry. We brought them in and really leveraged that. And this is a great segue to get into core values and scale map. But before we do that, I was pretty surprised to learn that you stepped down as CEO of this company, especially given all of your leadership background and student government and all these other ventures that you had. It really surprised me that you decided to step down as CEO.

35:15What happened? What kind of impacted you to make that decision? Well, I told my partners once, I said, you'll never have to fire me. I'll quit way before. The minute I'm not happy, I'll quit. And so we grew this business to this massive business. I mean, the business won all these Stevie Awards for ABA Awards. I was ranked the number nine highest rate CEO in America on Gloucester.com in this business. Right. So we had a list of accolades. Business was a private equity business. We ended up buying a bunch of companies. I had checked all these boxes on my list of things I wanted to accomplish as an entrepreneur.

35:46My first was I want to build a$100 million company. And Hala, do you want to know how big my company was when I made that goal? How big? It was$2 million in revenue. And I was like, I'm going to build a$100 million company. And that was in 2010 when I was like failing in my previous company. And I'm like, I'm going to build a$100 million company. And it took me five years until that happened. So I checked all these boxes that I thought were these like, I climbed this mountain that I was like, I'm going to go build a nine figure company and I'm going to win all these awards and I'm going to get written up an entrepreneur and all these things I thought that mattered.

36:17And then I did it all. And I'm like, it doesn't feel any different. And something happened in that we ended up selling one of the businesses because 2017 18, really hard years for the mortgage industry, kind of like 2022. This is a hard year for the industry right now too. And I ended up selling a business. And it was in December that year, I ended up basically moving 300 employees to a new company and laying off another 150. And it was the seventh time I had done layoffs because that industry is super cyclical. It's really cyclical. You have interest rates will drop 2%. And that's why we staffed up so much.

36:51And what I didn't tell you is I went to 1 ,000. And then in 2017, when Donald Trump got elected, rates went up. And we ended up laying off 400 of those people. And then I ended up over three rounds of layoffs. And I had done some layoffs before that because the industry is so volatile that we're always having to lay off. Grow, lay off. Grow, lay off. That's totally normal on mortgage. And I had this epiphany. And I was like, I don't think my core values are aligned with this industry. I'm a person that pours into people and pours into leaders and like goes out of my way. I'll recruit someone for three years to get them to leave to come join me.

37:24And here I am like two years later saying, oh, sorry, it didn't work out. And I was sitting in my car and I just done this massive layoff sale thing. It was not like a sale where you make a lot of money. It's like you sell it because you're trying to get people a soft landing. And I'm sitting in my car. It's January 9th. This just happened on January 8th. I ruined yet another Christmas dealing with bullshit. and my family is like in some art store and I'm in my car and I'm just sitting there. And all of a sudden, I'm telling you, there was no cognitive thing that happened. This was a came from my body.

37:55I'm a somatic intuitive, like my body talks to me. And I literally threw up the words, I'm going to quit. And I was 40. I just turned 40. And I was like, whoa, like first I said that. And then I was like, whoa, what the fuck did I just say? And I was like in shock. And my wife came back into the car and I was like, I think I might quit. she's like, are you serious? And I'm like, look, I'm going to give it a year. You know, I'm like, I'm not going to be impulsive about this. Like, I can't even believe I just said this. I'm going to give it a year. And it was like, God just grabbed me and threw me off the cliff.

38:27God was like, you know, get a year, buddy. And by November, it was, that was about 11 months later. And what year was this? 2019. By November, I was like, I can't do it anymore. I was like, I was a wreck. I hated it every moment. It had nothing to do with even the company at that point. It was just like me being in the space. I don't know. It was like out of body experience. And I just went, flew to New York, met with my business partner. And I said, I called my other business partners. One was my brother. I told him I'm done. And I flew to New York and told my business partner. And yeah, my company had a funeral for me.

39:01I did not stay. I left and I was done. Wow. So I stayed on the board. I mean, this is a big company. So I was on the board. I was I was a board of directors for 70 months while I figured out my exit, but yeah. And you had no plan, right? Like you quit with zero plan. How did you then decide to pick up the pieces, start your own personal brand, start a podcast, launch a book, all those things? What made you decide to go that path? During 2019, like my one respite from like obsessing about whether I wanted to stay or leave was I wrote my book. So I was writing the book for fun. So I wrote my book, The Core Value Equation, which is all about how do you build a core value-driven organization.

39:39But I was like this project I was like pouring myself into kind of side project. It was just for fun. I'd wanted to start a podcast. These are all things that like I'm a super creative person. So for me, like, but I was not being able to be creative because I was doing, I was running my companies. There was no plan for any of that stuff. November 13th, 2019, I resigned. I went to Asia with a CEO forum of mine for Christmas and New Year's. and I was buzzed on Belgium beers in Ho Chi Minh City, Saigon, Vietnam. And I told my wife, I'm like, let's go travel the world for a year. And that was like January 7th, 2020.

40:14And I was like, let's go move to Spain. Fuck it. Let's take a year off. Like we've always wanted to do that. I wanted... My goal was always like sell my first company by 30 and go travel the world. And that clearly didn't happen because of what happened to my previous business. At that point, it was like a six and a 10 year old. I'm like, yeah, let's go travel. Let's go have fun. I'll go figure out what's next. And so March of 2020, I had a trip planned to go to Barcelona to go look at schools and houses and then COVID hit. And the world ended. Yeah, my sabbatical trip around the world trip blew up.

40:49It went away. And so there I was kind of stuck in my house, like everybody else, kind of sheltering in place, trying to figure out what the hell I want to do with myself. and I was like, well, I wrote this book. My book was done at this point. I'm like, I wrote this book. Maybe I should go do something with it. You know, I just took that entrepreneurial hustle and I poured it into the book and then it started the podcast. And that's where I spent all most of 2020 was doing that. And the personal brand was just kind of by accident. I love that. I love this story and kind of the lead up to everything.

41:20So let's talk about the core value equation. You help companies determine their core values. First of all, how did you first get introduced to core values? And what do they mean? Yeah. So in 06, when I was running my first company, I was getting my teeth kicked in. I had about 40, 50 employees. I was really young. And back then, by the way, if you're an entrepreneur, there was way less resources for entrepreneurs. Way, way, way less. Like now, everyone's an entrepreneur. You know, people like me, what do you do? I'm an entrepreneur. I'm like, no way. Okay. Do you make money? They're like, oh, not yet.

41:52And I'm like, okay, sure. So back then, it was like nobody was an entrepreneur. There was no resources, especially a young entrepreneur. There was very minimal resources. I mean, this is like pre-Twitter, and Facebook was barely being used at this point. This is like MySpace times. So just to put it into context. And so I found this program called Birthing of Giants at MIT, which was put on by a guy named Vern Harnish, who has this business called Scaling Up. And I got in the program, and I was introduced to Core Values. and I don't know what it was, you know, maybe going back to this thing with my dad, but like, how do you live an engaged life?

42:28Values is a big part of that. And it just resonated with me. And year three at graduation, we did this exercise where these two founders who had this really successful company in Vancouver called Nurse Next Door, they said, please stand up if your company has core values. So it's graduation night of birthing a giant at MIT and everyone stands up and they say, please stay standing if you know your company core values and come see them off the top of your head. Everyone sits down. I'm sorry, excuse me, half the room sits down. Then they say, please stay standing if your employees know your core values.

42:57Half the room sits down. They say, please stay standing if your customers know your core values. Everyone sits down. And I'm looking at this room of 60 entrepreneurs. I mean, some of them like Kendra Scott graduated from this program. I don't know if you know who she is, but she's a famous entrepreneur. So there's a lot of entrepreneurs, like the guys that did like 1-800 Flowers and Rackspace. I mean, there's tons of amazing entrepreneurs that go through this program. And they're all sitting down. And I'm like, well, we're all the CEOs. I was like, what do you mean we're all sitting down? Like, that doesn't make any sense.

43:23And that was the pivotal moment for me. I realized that like they say you have to have mission, vision, values for your business, but nobody really knows how to do that. And I spent the next few years kind of obsessing. And what I realized was that building a core value or core purpose-driven organization, most people just think it's like a box you check. Like it's when you get your, like a thing you do through your MBA program. And my take is, yes, you have to figure out what's meaningful for you and you got to check that box, but you have to design it to be viral and sticky in your organization.

43:51During those five years of me getting my ass kicked in business, I spent a lot of time experimenting. And I figured out how do you design values and purpose and mission? You have to design it so people can actually use it. And the book is really a step-by-step manual on how do you build a core value-driven organization? Because my belief is that core values have the opportunity to be the language of accountability for your organization. And when it does that, it starts to attract people of like mind and like belief And again, values are the fundamental beliefs of an organization, the personality of the organization.

44:22So if I could get a bunch of people to show up who believe what I believe, who talk the way I talk about these beliefs, I have a much higher likeliness of them doing things like working the way I work and caring the way I care. All these soft skills that are so meaningful to execute properly, but people don't know how to do it. So the book is really a step-by-step process in how I learn to do it and how I teach people to do it. Yeah, I find it super, super interesting. So for me, when I had a company of 10 people, it was super easy to run. You know everybody, you get to hand train them. But now we're a company of 60 employees at Yap Media, and we need things like this, designing a mission, designing core values, because I don't even know everybody who works at my company anymore.

45:04And that's why you need that structure. So I find this super valuable. So one of the quotes in your book that you say is that companies do not have core values. People have core values. Can you explain what you mean by that? So core values of the opportunity, again, to become the personality or sorry, the language of accountability for the organization. It's not like it's like this thing, like until it becomes a thing, it's not a thing, right? So what ends up happening is a company like Yap Media, you have 60 people and they all have their own individual values. And if you don't define what Yap Media stands for and then hold people accountable to it and create a system where that can scale, what ends up happening is you end up getting kind of this like hodgepodge of values.

45:42And their values will show up in their actions consistently. And so once we pay homage to the fact that, hey, look, if the company doesn't have them, you're going to get what's there just by default because individuals have their own values. My belief is, is like they still have them even if you define what you are and screen for them and make them come to life. But what they do instead is they attach their values to your values. So in core value equation, we say core values, you need to discover what's authentic to you, discovering your values. You need to design them to be viral and sticky. Then you need to roll them out.

46:13So you need to teach people what they are and indoctrinate them into them. And then you need to implement them ongoing. And then you need to measure for efficacy and do that consistently. And so the process, the book really teaches how do you do that so that when I get that individual that shows up that has their individual values, that they figure out how do they leverage their individual values. And we do that as part of the rollout. How do you leverage your individual values to make the company values become more alive and well? And the answer is this. It has to happen organically. But you have to have a process to create that organic interaction, which is essentially what I figured out is you got to make it easy.

46:45You got to make it organic. It's got, it takes time. It's like, again, like you don't learn a language overnight. So it takes time, but you have to create those opportunities and it has to be easy. And so really the book Core Value Equation walks you through how do you do that step-by-step.

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51:12Don't wait and protect your privacy. Build your brand and get your complete business identity in just 10 clicks and 10 minutes. Visit northwestregisteredagent.com slash yapfree and start building something amazing. Get more with Northwest Registered Agent at northwestregisteredagent.com slash yapfree. And so you have your own core values. You have six of them. Can you talk about what each of them are and what they represent? I ended up in 2019, I ended up getting into this program called Stegen, which is a conscious leadership program. They have a program called Integral Leadership. And like in my class was the CEO of Whole Foods, Jason and I were in the same class.

51:52And the CEO, Doug, who was a former CEO of Crate and Barrel. And so there's some big shots. And there's only 20 of us in the class. It's a one-year-long program. And we're in the program. And this happened, by the way, this is February of 19, a month after I had said, I'm going to quit my job. And we're doing our personal values. And I realized I'm like the core value king, right? I'm starting my, I'm literally that same month writing my book on core values. And I realized I had not done my personal values, which is super weird. I wrote them very quickly because I, it was easy for me because I had experience with it.

52:21But yeah, my values, I have six values. I always tell people you get out of five. I couldn't just land on five. I gave myself six. And so number one is happiness called heart. So I like to think of sticky viral language to describe a value. And there's a description of what that looks like for me and for my family. Love is my second one. And that is besos, which is kisses in Spanish. Eye of the tiger is passion. That's my third one. My fourth one is curiosity. I call it cinco, which stands for what, where, who, when, and why. Creativity is number five. And I call that boom. boom and my sixth one is balance and I call that movie night yeah it's just I always measure myself against them again like you know when you're going against your values because that's when friction starts to get created whether in your organization or in your life and for me I'm always I always have my eye out like what am I not living right now that I know I want to live and I always tell people core values can be slightly aspirational for me my values that are aspirational or as balance, that's hard.

53:19And happiness, I fight to be happy. I fight for balance. The other ones are a little bit easier. I'm naturally curious. I'm a pretty passionate person. Curiosity, again, natural, creativity, natural. But happiness and balance, I fight for those a lot. Yeah. I like that you give everything a catchy, secondary name so that it's super memorable. And I think this is super important for organizations because when it comes to building a community, having a common language and things that you guys only know about is really important for bonding. So tell us about why you say that you need that like sticky version of the core value as well.

53:54Again, if you believe that core value is the language of accountability, then the language matters. Words matter. Like literally like empires have grown and fallen because of words. I'm reading a book with my son and we're reading actually about the, it's about the history of the world. And we're on the chapter about Islam right now. And you realize that Muhammad basically built an entire empire, the Islamic empire off of just words. Like he went out and talked about Allah, right? And that created this entire empire that got all the different tribes to come together. So words are so powerful. That's just one example.

54:27There's been empires built on words. Like you look at the United States of America built on the words of our founding fathers, right? So why would you not pick viral sticky language that stands for what you stand for? Or you could be like everyone else and pick boring words like integrity. It's like, well, yeah, everyone has integrity in their core values or driven or, you know, excellence. It's like, well, what's the difference between Yap's excellence and the guy down the street? And I'm like, how about you say it a different way? It makes it where it sticks in people's minds. There's a reason people do it in branding.

54:58And there's a reason that they usually do it in core values, which is like, if it's gonna be the language of accountability, let's give them some language to work with. And I love viral sticky language. Yeah, I love that tip. So talk to us about what a core value driven organization looks like versus one that has no core values. Well, again, going back to your question before is like, people have core values, companies don't, unless you create them in your company. So what ends up happening is, if you don't have a core value-driven organization, all that is, is me defining what I stand for and holding the organization accountable to it consistently and making it drip throughout the organization.

55:32So what does that mean? Does that mean that you're always living those values? No, it means you're always trying to live those values. And when you fall off, you fix. So you get back to center, the core, right? A non-core value-driven organization is someone that just shows up and does what I call BAU, business as usual. You get what you get. Oh, hey, Johnny over there has shitty work ethic, but Sally over here has great work ethic. There's a value misalignment, by the way. You think that doesn't create friction? Your team will manage themselves to the lowest common denominator. So if you let losers hang out in your company, no offense, losers, but everyone else can be like, well, I guess Hala lets losers hang out here so I don't have to try as hard.

56:05Like they put up with bullshit. And so my belief is, if you have a, let's say your values around work ethic or excellence, but you let mediocrity hang out, well, do you think you're going to really have excellence happen? The answer is absolutely not. You're going to have mediocrity. You have pockets of excellence that happen accidentally, or you could do it my way and be super intentional and hold everyone accountable and the organizational accountable to this idea of excellence. And when someone shows up and they can't measure up to that, they get to leave. And what happens then is you have accountability around those values.

56:37And the people that love those values, they'll be like, hells, yeah, I'm in the right place. And the people that don't are going to be like, hells, no, I want to get out of here because they're going to find out that I don't like this. And it's not to say they're bad people. It's just not the right environment for them. So that's how I characterize it, at least. Yeah, I think those are great tips. So there's some mistakes and some common mistakes that people make when it comes to their core values. First of all, they make them too wordy. They're not simple enough. They're too complex. and sometimes they're too nice.

57:07So I'd love to get your feedback in terms of like what good core values sound like versus bad ones. Your organization has a way you guys speak. And there's tough, gritty organizations and there's really like buttoned up, pretty organizations. And then there's like a middle ground, hippie organizations. Like everyone's, your values are the personality of the organization. So there's different personalities, just like there's different personalities with people. So a bad value is one that's not authentic. i.e. you say I value showing up for the team, and yet you don't, and you're the CEO. That's a problem.

57:38And in my book, I say that the minute the CEO doesn't live the values, you just put a bullet in the head of the values. So bad values are ones that aren't true. They're ones that are not authentic. Because again, there's five steps to creating a core value-driven organization. Discover, design, rollout, implement, measure for efficacy. If you discover and you are trying to please imaginary people, clients, team members that probably aren't going to be there in the future anyway, because you're out of alignment with your values, then you may pick values that are not authentic to who you are. So I see people do that all the time where they'll pick really like warm and fuzzy values, but they're not a warm and fuzzy organization.

58:12That's a bad value. Just say that you don't put up with bullshit. The people like Travis Kalanick, I just finished watching the show super pumped. Dude, that guy, one of their core values was called toe stepping. That was core value number seven for Uber. Toe stepping. Does that connotate like niceness? Hell no. That connotates fucking people up if they don't live your value. Toe stepping. Stepping on someone's toes. Have you ever had someone step on your toes, Hala? Yeah. Yeah, it hurts a lot. Toe stepping is their number seven value. Well, he ended up creating a toxic culture because of it. But he created something amazing too.

58:49It scaled till it didn't there. So that's a bad value. from a design standpoint. And that's actually a perfect example that core values don't need to be nice. Hey, man, if you're a toe stepping organization, say what you are. Here's what happens if you don't. Sally, the flower loving hippie shows up, and she sees Travis toe stepping on Johnny. And she's like, Whoa, where do I work? And that's a misalignment. Whereas Bobby, who's a badass, likes to toe step. He's like, Oh, cool. We toe step here. No friction. And what I say is, and I do a lot of coaching now and advising with companies, is I say, for scale specifically, I say, look, scale is a friction removal process.

59:26You want to scale fast, remove friction from your business. The way you remove friction is by eliminating problems before they become problems. And what we're talking about right now, a value misalignment is one of the worst problems you can have in your business. That's where you get infighting and politics and drama and all that bullshit. And I don't want any of that stuff. That's just slowing you down from winning. And so scale is a friction removal process and it starts with values being aligned properly. Okay. So here is some advice that I'd love you to give. So let's say you're a company like mine.

59:55My company blew up so fast. What advice would you give in terms of the executives at my organization or any new startup to begin to develop their core values? What are the first things that we should do to kind of brainstorm and hit the drawing board for our core values? Well, I go step by step through my book. So you need to do the discovery process, which is there's so many different values you can stand for. So you need to really pick what are the top, you know, three to six, I say. Four is the good, I like four to five. This is a good sweet spot. And there's a book called Built to Last by Jerry Porras and Jim Collins.

1:00:28And in that book that they went and studied visionary companies and they found out one thing. Visionary companies stand for no more than seven and no less than three values. So, and this is studying some of the most iconic companies of the last century. So for me, it's let's pick out of that 100. And in my book, we give a list of 105 words that you can in the book, if you pick up the book, it's in there. And I highly recommend it. And we'll put it in the show notes. Yeah, so it's in there. There's a guide for this. So we have a guide that we give when you buy the book. And so you just eliminate those 105 words, you pick your top 15, and you rank them in order because values have a hierarchy.

1:01:01So you want to put them in order that now you've discovered what are your top five values? What matters most to you? From there, you have to go through a design process, which is making them viral sticky and making them, I have some tests I put them through. Do they stand the test of time? Is there any negativity in there? Do you have product, remove product? So I have a laundry list of like checks and balances, but they have to be designed to be able to scale as you scale. In order to do that, they need to be designed so that they can become viral and sticky. So you go through that process and then you got to bring them to the team and teach the team so that they learn what they are and create systems for that in the business.

1:01:36And in the book, I talk through step by step, how do you do all those things? Yeah. And I can't wait to take my team through this exercise. I'm super excited about it. So you're known for two things, core values, which we just covered in a lot of detail, as well as scaling businesses. So you have this methodology, the scale map method. MAP stands for mission, accountability, and performance. So could you go over MAP and your scale map method and what each section is? And I can kind of just ask you a few questions about each area. Yeah, there's a word in Japanese called shibui. Have you ever heard of this word before?

1:02:11No. Okay, so shibui, it means that there is complexity and simplicity. There's complexity and simplicity. So even with the core value equation, it's around creating something that's simple. I'm a chronic person that makes things complex. So I have to simplify it or else I'll never do anything. And the core value equation is all around how do you simplify the process to make it work? When I left my business and COVID hit, I was sitting on the sidelines and did my book launch. And when I came out of that, I got asked to advise some entrepreneurs on scale because I was always the scale guy. How do you grow your company fast?

1:02:46And having grown a company that quick, the first leg of that growth was 30 to 300 employees in 18 months, which is crazy. It's a 10x, right? And by the way, when I did that, we had off-the-chart record engagement scores and zero growing pains. and then we went from 300 to a thousand. And so this is all around scale methodology. So the other thing I learned and got to play with during this time was these different scale systems. And I learned something really simple is that you need to have scale systems to complement your cultural systems. And I always tell people scale is about three things. You need to have execution systems, strategic systems, and cultural systems.

1:03:22And they need to talk to each other and they need to be simple. And so ScaleMap was really born out of me starting to help other CEOs grow their companies. And right now, we have ScaleMap method. We coach right now, gosh, almost 30 different companies. And we teach them the process. And really, it comes down to three things. And ScaleMap itself is the execution side of this. What is the execution asset that I built in the business? And there's three parts. Mission, which is where are you trying to go? And we want to look at that in three different increments. 10-year, 3-year, 1-year. And when I always say, what's going to happen in the next 12 months, month by month?

1:03:54What's going to happen in the next three years? And then I just want you to lean into the future and have some faith. and where do you think you take the thing in 10 years? For some people, they say, well, I want to sell before them. I go, fine, five years. Once I define where I'm trying to go and I want to look at that in a few areas, revenue, income, staff size, ethics. Am I building a business that's sustainable? Revenue and income will tell me that. How many people do I need to get them there? And I want to look at that again, 10, three in one year. And then ethics. Am I creating any future liabilities for myself?

1:04:20Subprime mortgage lending, I created future liabilities for myself, my first business. So I learned you have to be cognizant of that. Then what we do is we create accountability systems around that. And that comes in in meeting structure. So we teach admission, we teach how do you build quarterly plans. And so this is what I teach CEOs. How do you have simple systems to do this consistently? A is accountability. If I build a quarterly plan, and I have my mission and where I'm trying to take the business to, and again, what do I do with that? My team knows what they need to work on. They understand the priorities.

1:04:48I understand it. It's mapped out. I have a plan to work with. Well, a plan is as good as the paper it's written on if you don't have accountability around that plan. And so A stands for accountability. And we do that in two different ways. Number one is what we call rule of one org chart, which is who owns what defining who owns what in the business. I don't want overlapping responsibilities. I want people to understand who owns what in the business. I want to spell that out and document it. And I want that to be a strategic tool for growth. IE, if I map out your entire organization, what are the top two hires you want to make in the next 12 months?

1:05:21Strategic hires. What are the top two hires you want to make in the next three years, strategic hires. The people you bring into your organization in the next year and three years, leadership-wise, are going to define where you go in that time period. But I want to map that up so there's clarity. The next thing I want to do is I want to build a meeting cadence. And what I tell people is accountability comes through cadence, cadence comes through rhythm, and it's the heartbeat of execution in your company. And we do that through a meeting structure we call 1590 meeting rule and 30 every 30, which is your team meetings and your one-on-ones.

1:05:51All right, you got mission, you got accountability. Well, what's going to happen is, how long is you're going to start to get performance metrics? Data is going to come out of the business. Well, what do you do with that data? And so P stands for performance. And that's looking at the data that comes out of the business. And we do that in three areas. One's called a five-question poll survey, which is me understanding my customer experience and my team experience. The second is we call three-by-three KPIs, which is how do you build KPIs that, again, going back to what I said 15 minutes ago, So scale is a friction removal process.

1:06:21I want data to tell me what's breaking before it's going to break. So we have a whole system around that. And then last but not least, it's called C3P &L, which is how do you look at financials so they tell the story of growth? And so it's a really simplistic, going back to this idea of Shibui, is there complexity and simplicity? I want to really focus on the 20 % that's going to move the needle. And I want to get everyone aligned around that and then sit that on top of a cultural asset known as my values. And when you do that, you grow like crazy. Yeah, I love some of these ideas I've never heard before.

1:06:52And I love them so much, like rule of one org charts, the fact that everybody knows exactly what they're supposed to do. One person is assigned to one specific task. There's no confusion. That is so important when you're trying to scale a team. And I love building the org charts for the future, because that really helps you understand like how to budget, what hires you need to make, who's going to come into your company and really help scale things. And then your rules around meetings are super cool. So I'd love to kind of get a little bit more detail about that. So you have the 1590 meeting rule, and you also have 30 every 30 rule.

1:07:23So let's hear about those two rules regarding meetings. First of all, most people think meetings suck, and they usually do. And so if you have bad meetings, then that means you have bad execution. So if you have ineffective meetings in your business, and we use a tool that we teach in ScamUp called the meeting autopsy, which is you just like kind of do an autopsy of what your meetings look like and how good are they. And usually people have one or two issues. They have too many meetings or not enough meetings. And so for me, I'm like, let's just keep it simple. Like the daily huddle is the 15 minute meeting, and it needs to be done a certain way to maximize daily accountability.

1:07:55So the 15-90 meeting rules around the huddle, and then the 90 minute meeting is your weekly execution of your quarterly plan. Like I want to build a plan for the quarter, and then I want to hold people accountable to it week in and week out. And what I do is I look at the business in 13-week sprints. You have four 13-week sprints that come out to 52 weeks a year. I want every week, every five business days, your team has to show up and say that they are either on track or off track on their goals. And if they're off track, we're going to have a discussion about it. And in my businesses, there is no being off track.

1:08:24Like someone has to have died for you to be off track. So yeah, so scale is a friction removal process. And what I teach CEOs and my entrepreneurs that I work with, I say, hey, look, we want to get really clear on creating a culture of accountability. But you got to make it simple or else your team is going to vote with their feet. They'll be like, oh, Hala has us doing all these things. This sucks. I hate it here. And my perspective is like, no, let's make it really simple. And then they'll get ROI out of it. You will create an organization where nobody can hide. And when nobody can hide, there will be people that like to hide who will leave.

1:08:55And I say, great. Sayonara. And the people that don't, but then there's the other side, which people that like accountability, and they'll be like, hells yeah. Hala's got a great business. I love our meetings because we get so much stuff done. And everyone's always hitting their goals. And the business is growing. And we're getting more organized, not less organized. So that happens because you have good meeting cadence around your quarterly plans and around your daily accountability. The 30 every 30, it's the 30 minutes you need to spend with each team member every 30 days. And I built this framework around how do you do one-on-ones?

1:09:26And so I teach that in our bootcamp. And then also we have a mastermind. I teach that to that. And I also teach them to my one-on-one clients. But it's really focusing on the one thing that matters most to your team. And you know what that is, Hala? What? Themselves. ain't that the truth you got to make it about them and you got to pour into them and you got to and if you do it the right way you can figure out what's slowing them down and then once you pour into them through a really nice framework you can then hold them accountable to what you want them to be held accountable to but what a lot of managers do is the only time they meet with their team is when it's bad news or to give them shit about not hitting their numbers and i'm like yeah like you're just the dad that's over critical like nobody wants to hear that right So my question is, what are you doing to make them successful?

1:10:10And are you creating an opportunity, a nice consistency around one-on-ones? And one-on-ones is the biggest area. Some of my clients that I have 500 ,000 employees, and they have 33 % of their managers doing one-on-ones. And I'm like, you're telling me that two out of every three people don't do one-on-ones in your business? You can't tell me that's not affecting your ability to win. I know it is. So for us, we create a nice system around that. And then what's cool is if you do it one way, then you can hold all your managers accountable to that same way. So you have what's called consistency. And with consistency, you remove friction from the business and scale is a friction removal process.

1:10:45So that's what you're doing. Amazing. Oh my God, Darius, all this information was super valuable. I feel like there's a lot of things that people can take away. But I feel like there's so much knowledge that we haven't uncovered yet that is in your bootcamp, that is in your mastermind. So tell us about how we can find out about those resources. So you could go to do dariusscale.com. So that's where you can learn more about the bootcamp and about the coaching. That's kind of my give back right now. I love pouring into CEOs and entrepreneurs. So dariusscale.com is a good place to do that. You can go to The Real Darius for all things Darius.

1:11:19And that kind of has the book and podcast and stuff like that. But a lot of this also is on podcasts. So that's The Greatness Machine. And on that one, we're interviewing a lot of these experts that have built these amazing businesses. and there's a lot of learning there too. So those are the three places, but all things, the real Darius, that's all things Darius. Yeah, and I'll put all those links in the show notes, but selfishly, I want to understand what can people expect in the bootcamp? Like, what is that like? Oh yeah, that's like drinking from a fire hose for three days. So it's really three days, you come in, we teach you, we build your rise targets.

1:11:51So we build your 10, three and one year plan. We teach you how to build quarterly plans so you can start to do quarterlies the right way in your business. And I mean, so many entrepreneurs do those wrong. And they build these crappy plans that don't do anything. So for us, it's how do you build like these rock solid accountability plans. And then we really take you through teaching how do we do the meetings, showing you how to roll it out, teaching you how to build KPIs, showing you how to roll that out. So it's a three-day bootcamp where people leave and they're like, all right, it's a lot, but I have a lot to work with now that I can...

1:12:21And we'd show you how do you bring it back into your business. And is it typically like a CEO and entrepreneur? Is it like you bring your exec team and you do this? Is it virtual? Is it with a group? Yeah, it's a group. We do small group. I run it. So it's you get to spend three days with myself, which is always fun. And we do a lot of open coaching. So I mean, I'll do stuff where I just like you can bring me any problem. And mastermind, we do that too. But yeah, like it's you and I let people bring their number two. So it's you and your number two. It's small group. It's a lot of one on one time.

1:12:52I have coaches that will meet with you before and after and during. and we do a lot of breakouts. It's a workshop, so it's interactive. There's like, you're working, like there's a lot of interactivity. And the idea is that you're building, you're really building these things for your business that you need to get yourself organized and learning the framework so that you can then go back and apply it to your business. Because so many people are just guessing. And the problem I find with a lot of these other scale systems is they're, you know, by the way, like I didn't make all this stuff up. I did the other scale systems.

1:13:21They're hard. I quit them. You know, I'm a creator. I'm like, this is a better way of doing it. I'm going to do it this way. And I kept like retweaking other systems and also creating my own stuff. So this is all born on the back of other systems that are, God bless them, they're great systems, but this is a better technology from my perspective. Yeah, well, I'm super excited about it. I'm going to pitch it to my team for us to do the scale map bootcamp with you, Darius, and hopefully we get to do that. So the way that we close our episodes here on Young and Profiting Podcast is we ask the same questions to every guest at the end of the show.

1:13:53So the first question is, what is one actionable thing our young and profiterers can do today to be more profiting tomorrow? So here's something I tell everybody, and I call it my fulfillment formula, which is, and if you do these three things, I think that this is at least what I've learned over my life. I'm 44. So I'm young, but I'm also old, right? Like I'm on the fence. You're medium. Yeah, I'm medium. Well, yeah, I'm experienced, right? So are you living in your values? So get clear on what your values are. Because the minute you ever feel icky or like friction in your life, it's you're rubbing up against your values.

1:14:30So get clear on what your values are and start to look at them on a regular basis. And so I always say, are you living in your values? Are you working in your strengths? Are you doing work where you are working within your talents? And I like StrengthFinder. That's my tool that I use and that I teach. So go pull your StrengthFinders. Go look at your strengths and ask yourself the honest question. Am I actually living in these strengths? and then start to measure yourself against it if you want. But am I living in my strengths? You're working in my strengths, living in my values. Am I doing it with a high level of awareness?

1:15:00And I have a buddy who, his name is Marco Gargenta. He's the CEO of a company called Plus Plus. He says, fulfillment comes through, again, living in my values, working in my strengths and doing it with a high level of awareness. And awareness comes through three, four areas. Number one, am I being mindful? Do I have a mindfulness practice? Am I exercising? Am I dieting consistently, eating a good diet? Am I sleeping well? So are you getting rest? Are you practicing mindfulness? Are you treating your body like a temple, right? Doing the right things for my body. Am I working in my talents and living in my values?

1:15:34And so my answer to your yap crowd is if you're doing those things and start to pay attention to those things, the good things just happen. Okay. And our last question is, what is your secret to profiting in life? I think it goes back to what I just said. I really think it's finding that cross-section between what you love to do. There's a word in Japanese called ikigai. And so it's really finding that cross-section between what you love to do and what people will pay you for and really going all in on that. And so for me, it's like, how can I do more of that? I love that. Thank you so much, Darius, for sharing your wisdom and sharing your story.

1:16:11It was super valuable. Thanks, Hala. I love being here.

1:16:22I love you.