Self awareness is a trait or skill or genetic advantage we all need to beg or borrow. (No stealing) Fernando has it and wait until you hear what it did for him! Very smart guy, who offers tons of value and knowledge almost immediately. Imagine if you focused on your business like Fernando did (does)? What could you gain from it? More importantly what you lose may be the best thing that happens to you!
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Transcript: (note- this is a new tool I am trying out so it is not perfect- it does seem to be getting better)
Fernando: 00:00:00 We also are, are really good at vetting like people that, that we know will bring value and improve the company from where it is today.
Cool voice guy: 00:00:11 Welcome to the ECOMMERCE guys. Will we focused on the people, the products and the process of newcomers selling today? Here’s your host. Steven Peterson.
Stephen: 00:00:25 Yeah. This is going to be a good episode. Hey, just wanted to jump in with a couple of things. There’s a couple notes about some things going on with Andy and myself at our warehouse. Some opportunities to work with us. I’m going to get them in a second, but first up, man, I’m, I’ve kind of mentioned something. I hope you’ve saw this. Um, one of my sponsors, seller labs was recently honored as one of the top companies, the top fastest growing companies in the United States and they looked at the top 5,000 and these guys didn’t make, you know, number 4,000 or 3000 or 2000 or 1000 or 800, 500. Now they’ve made the 148, I think it was. I mean, just imagine that what’s it take to be number 148 out of 5,000 that were recognized and you know, it’s just an honor to be recognized now to be 148.
Stephen: 00:01:16 It’s a big deal and you know, I know, yes, they pay me and all that kind of jazz, but again, you hear me talk about consistency over time and when you see a company that’s doing these kinds of things, it takes really strong leadership. When you, when you hire services and we all pay for service, I’ve got a lot of them and when I recommend a these companies that I recommend, it’s because I use their services right over time. What I love is this, as you go to an event and there’s jeff or tyler, one of them are always our ed are always at the event because you can go and give them feedback, right? Feedback. Genius gets better because you give them feedback and they help improve the product. They’re always at every event and they’re willing to talk with you. They’re there to talk to you.
Stephen: 00:01:57 How many companies do that? You know, it’s easy to, I get these companies all the time, hey, you know, would you let me promote, I got one right now, would you let me promote and will want to sponsor it and that mom, no, I don’t know you, I’m sorry, and your new then maybe you do have the best company, but again, I’m looking at it over time and again for similar labs to be recognized across the country and that just to make the list of $5,000 a huge deal, but to be on number 148, that’s a really big deal. So, you know, Jeff Cohen, a Brendan check hurts, um, and uh, uh, Hank, sorry guys. Um, it’s just so exciting for me. The leadership that you guys have put together for this company. It’s phenomenal. And it just said something about you. So I 100 percent salute out.
Stephen: 00:02:41 So I just don’t want to miss that. That is such a big deal. Um, that’s why I think you should be with sellerlabs. Look at all the product scope, right? Ignite, take a look at a feedback genius. All those products that they have, right, they’re doing advertising, all that stuff is there to help you, but again, they’re going to be there next year and I think that’s the thing. You want to remember how many companies have we seen come in and go out because they moved onto the next thing, cryptocurrency and all the rest of the, you know, and I don’t fault him, but that’s not the kind of company you want to be with. You want to be with a company that’s going to be here for the long haul that’s going to help build that brand that we’re all trying to build and that help you take it to the next level.
Stephen: 00:03:15 So, so her labs, well done. I applaud you. Very, very cool. Um, another big one with one of my sponsors is Gaye Li group. You’ve heard me talk about it’s q four is coming up, all that kind of stuff. But what’s very cool is she’s now given me a special two week free trial were the only ones who have it. You get a free trial if you’re interested in a sourcing group, daily product find. Um, and I’m going to have an announcement in the next week or two with a special bonus thing that you get if you joined, but try sign up for two weeks, try it and then sit back and say, is my business petrol off? Am I in a better position for q four? And my theory is this, have a strong q four to get the cashflow. So you can build next year’s business.
Stephen: 00:03:58 You should be building next year’s business. How are you going to do that? You need the money. Use this as an opportunity. I just think it’s phenomenal. So it’s you go to amazing freedom.com, forward slash momentum, hyphen arbitrage. Yes. It’s a mouthful. Amazing freedom.com, forward slash momentum, hyphen arbitrage. And you get that two weeks free. It’s phenomenal. And last but not least, I don’t want to Miss Karen lockers solution for ECOMMERCE. She’s doing listings for me this week for all these new private label products we have going up. And it’s unbelievable. You know, I just send them to her with some information and boom, they do it, they test it. Now here’s a better example, there was a listing, it’s a wholesale account that we have and I said, hey, could you get these four or five photos added on now I need to with Karen idea with some of her team members, which I have my own, you know, assigned person for my team, which is phenomenal.
Stephen: 00:04:52 And she was like, Hey Steve, I’m having trouble. I’m waiting for them to link or whatever. She followed through and then eventually she said, oh state, go take a look. They’re up. That kind of service is what I’m looking for and that’s what I get from Karen’s lockers team. It’s solutions four ecommerce solutions, four ecommerce, a forward slash momentum and you’re going to save 50 bucks and which is great and it’s 50 bucks every month from there on out. Okay. And so consider that, and if you have any questions, whatever message me or message Karen, but solutions the number for ecommerce forward slash momentum. And Man, I just love, love, love the service. So back to andy and myself. So what we’re doing at the warehouse, we have a couple things going on. So we have, we have our fifth client coming on board now. We’re not a fulfillment company, we’re not in that world, we just have some storage space and some relatively lower cost.
Stephen: 00:05:41 And the good news is we’re only an hour from Avp, so if you send a lot of material, the APP, it’s very convenient here, um, because it’ll check in usually that day or the next day. Um, but we have a loading dock so we can hit pallets and we ship out by the pilot. That’s the way we prefer to do it. Um, but we have a couple openings if you’re interested in working with us. We’re not interested in doing any ra or away just be, can we just not, we don’t live at that warehouse, right? Um, but we can work especially for pallets, containers and stuff like that. Um, and we have a couple of wholesale clients but mostly private label. If you’re interested in joining us, you want to message Andy, Andy Salmon’s a private, message him on facebook and start the conversation and that eventually we’ll get into it if you’re interested in that.
Stephen: 00:06:25 Second thing we’re doing is we are actually going to hold the summit, we’re gonna hold a summit in September 22nd, I believe the date is, and he’s going to talk more about that, but if you’ve been interested in finding out what it takes to run a successful full time or part time, I mean, I’m part time so I’m, I’m pretty good example of part time. But uh, how about an Ra business doing over 3 million? I think it is. 10 Wentworth is joining us for this summit and Andy’s going to be bringing in his private label, his wholesale and is already. Remember Andy used to do Ra and we’re going to bring this whole thing into a conversation. Very, very limited group. I’m not very large, but it’s a workshop type of deal. It’s in our warehouse. We’re actually going to let you see behind the curtains. Um, who else is willing to do that? So if you’re interested in that message and about summit, you want to get on that list and find out some more information. He’s going to be talking about it over the next few weeks, but I just wanted to get that there. Now let’s really get into the podcast.
New Speaker: 00:07:25 Welcome back to the ECOMMERCE momentum podcast. This is episode 332, Fernando Cruz. Then, Oh man, these young guys gets smarter and smarter or I’m just getting older and dumber. I’m just so cool to see guys figure out. They know their lane. They know they are self aware as Gary v always preaches, right? They’re self aware of what they have. It’s not an ego thing. And I said that to them because it, it’s not like he’s an ego. He’s a very nice, genuine person, but he understands what he knows, that confidence. I’m a healthy confidence. Like that humble, healthy confidence is so powerful. It’s such a cool thing. And so you can build on that and his, he gives sage advice here. I mean, here he is, young guy. He gives sage advice. Um, but it’s because he’s investing in himself, you know, he’ll, he’ll eventually tell you how many hours a week he spends on himself in learning and growing.
New Speaker: 00:08:23 I think a lot of us Steve misses that, you know, I always say I’m going to go to my office, I’m going to read it. My Office, I’m looking at about 50 books that I haven’t picked up in my office and yet here I am saying we should be doing this and here I am not doing it. So guilty as charged. Well, Fernando was like, yeah, that’s great. Although side distractions, let’s get rid of that. Let’s outsource some of that stuff so it’ll give you. Because his advice about calculating how much five minutes is times five years. We’ll give you some real perspective. Those of us who don’t have time listened to it and you’ll be like, oh, that hurts because he’s right. Very, very cool story. Very cool perspective. Very cool on how they’re building out a very large business and a very smart approach and just a great story.
New Speaker: 00:09:08 Let’s get into the podcast. Alright, welcome back to the ECOMMERCE momentum podcast. We’re excited about today’s guest because I think, uh, for a young guy, he’s got a lot to offer and teach us because I think his experiences in life, which we all have to go back and drawn, he understands the value that they brought him and I think to be so young to understand that is a big, big competitive advantage. And as a dad, I hope by boys get as much confidence in their knowledge as Fernando Cruz does. Welcome Fernando. Thanks so much for having me, Stephen. Really appreciate it. I mean what I said, I mean the fact that you know, you know, and it’s not an ego thing. I mean that’s the real world and I think today you have to be able to tell me what value can you bring me in and, and, and I’m not asking for anything but it’s true to stand out. Do you get what I mean? I think that that’s, that’s so, so important to be so self aware, especially as a young guy like yourself.
Fernando: 00:10:05 Yeah. I couldn’t agree more. Yeah. It’s um, there’s just so much information now. Some people like with social media that you can connect with and it kind of, you know, figuring out your story and your identity and kind of being treated that is ever more important now and like 2018,
New Speaker: 00:10:25 do you find it hard to stay on track with it? Because I’m sure you know when you, when you have capacity or you have abilities, you know, I’m sure the shiny object thing affects you like every other guy, right?
Fernando: 00:10:39 Yeah. I mean it’s, it’s uh, it’s difficult. I mean, um, I think it’s definitely transitioned as we’ve grown as a company and we’ve become probably more disciplined as entrepreneurs, but in the beginning it was really hard. You know, like in the Amazon space there’s, you know, a retail arbitrage and private label and wholesale and just in that. And that’s, if you don’t build a shopify and go into retail and all that kind of stuff in it, it’s always really difficult to really stay focused because, you know, you’re like wanting to diversify and um, yeah, I mean it’s always a challenge, but now that we have more people, uh, we can take more bets. Like now we have a team of over 50 people, which helps a lot. Um, but it’s still like, you know, making sure that everybody’s aligned and working towards the same goals is definitely always. Um, it’s something that we’re always working
New Speaker: 00:11:37 for. Sure. I think when you, when you describe a group of 50 people, it’s, it’s worth noting what type of people it. Because if they were all type a entrepreneur people, it’d be like herding cats, right? Trying to catch them all. When you’re looking to build out that team, you’re looking for different types of individuals for that. And has that helped him stay in that lane? Is that, is that kind of fair?
New Speaker: 00:12:01 Uh, yeah. I mean I would say that a good amount or type a. it’s actually interesting. So I just finished his book principles. I don’t know if you,
New Speaker: 00:12:10 I wasn’t familiar with him but I have not, I’m not. Uh, I’m not familiar with the book.
New Speaker: 00:12:15 Yeah. So part of it he talks about how he actually makes every single one of his employees take four different personality tests and I those really interesting. And so like, I actually just implemented diner and team and I’m still actually kind of going through it, but yeah, I mean I’m, I’m trying to set up like the organization where you have like every department or business unit will maybe have like kind of come into a visionary leader that’s kind of, you know, thinking about two to three years ahead.
New Speaker: 00:12:44 Stop for a second. So, so hold on a second because I think this is a really powerful stuff what you’re saying because each department has to have, I mean you want them all rowing the same way, but the finance department has to take a different approach because their goals are different. Yes, we all want to make profit, but their goals might be to give better information to the for utility to the end users. Right? So, so you’re trying to create visionaries by, uh, by tower kind of like.
New Speaker: 00:13:11 Yeah, exactly. I mean it might be a. So yeah, that’s a good question. So it might not necessarily be within a specific department. Like, I don’t know if you’re, if you’re too visionary and finance, that might be a little scarier.
New Speaker: 00:13:26 Reformed accounting, remember, hey, be careful,
New Speaker: 00:13:30 but uh, like I think in terms of like a wheel, like a retail division, so that’s focused on getting their products into retail and so kind of like looking at like, okay, well where’s the market heading? Like what products are coming down like, and their focus is like thinking like two to three years, you know what I mean? But they’re not really focused on putting out the fire and um, and necessarily managing like the day to day and stuff like that. Like they should be thinking bigger picture like, you know, typically like an entrepreneur would and then like I want like a kind of that I’m not necessarily type a b, but like the more organized like the, the person that isn’t a, that’s going to be more constrained, it going to be in that kind of the uh, the number two position that’s going to be like really supporting that, that kind of visionary leader.
New Speaker: 00:14:24 Okay. So somebody cast the vision and so that second person is the one that, that can execute it, the one who can actually do the work and follow through.
New Speaker: 00:14:31 Exactly. Exactly. So we’re trying to set that up based on like the personality test and seeing like who kind of fits into those roles.
New Speaker: 00:14:38 So you’re looking at each segment of your business as a team. I didn’t mean to cut you off there. I just think this is very, very forward thinking and I don’t want to lose this because I don’t think to be honest with you, Fernando, most people don’t spend this time working on their and I’m sure that’s a miss. I mean it’s a miss, uh, for, were a lot of small businesses, but you know, you have to start somewhere. So I think this is very powerful what you’re saying. So you’re taking each segment and making sure that they kind of have that visionary than have the operator and then have the, you know, the people who can actually do the work. I think that that’s a very powerful way to look at your business.
New Speaker: 00:15:14 Yeah. Thanks man. Yeah, I mean we’re. And we’re doing that with every department. So like even like our supply chain, right? So you still want like, even though like it’s a, as a, as a department, it’s like more kind of operational. We still want someone to be at the top kind of thinking like, okay, looking at the P and l and be like okay, these are the three areas where I think we can reduce cost the most and kind of assigning that out and having like a one, a executer. So like I still think that like, yeah, for it can be applied to both departments and business units. But I think that’s been one of the interesting things that we’re, we’re kind of implementing today that um, that actually yeah, I got from a book
New Speaker: 00:15:47 from, from Ray Dalio, the ability to learn something and then actually apply it is a very, very strong skill set because there’s no new information. I mean I’m sure what he’s saying, he’s, you know, been told a thousand times. It’s the, the, his ability to actually do it probably is what the difference is. What have you learned? Give us an example of something that you learned that you were surprised with when you started. You know, like you said, you’re just getting started with it, so I’m not expecting giant strides, but I mean, was there anything that you were surprised with when you left? You did Steve’s test and you were like, Huh? I thought he was a wallflower. It turns out he’s got, you know, crazy things going on or example like that. Anything.
New Speaker: 00:16:25 Yeah. I mean it’s still, yeah. Again, like really, really like a early stages. But yeah, I mean, um, some people that I thought war I’m more introverted or actually like pretty extroverted and so I think maybe has to do with like, you know, a lot of our team is remote so it might be just like the distance, but it also could be cultural. It could be, you know, that, you know, I’m one of the people that started the company so that maybe they’re a little bit more timid. She’s just like, there’s just so many reasons why that could happen. Um, but yeah, I mean I think uh, overall it’s like, I think it’s really important to have people that think a little bit differently on the same team because if everyone’s exact same personality type then you’re going to get kind of the exact same results, right?
New Speaker: 00:17:16 Nothing new is going to get introduced. So what do you see? Like let’s stay with that example. So you saw some people that are extroverted that you didn’t think were because they were reserved, like you said, they were probably respectful and trying to be, you know, don’t want to be respectful to the boss. What’s your thought process now? I mean, what opportunities do you see different that perhaps you wouldn’t have seen?
New Speaker: 00:17:38 I think it’s more about me trying to like understand where they’re coming from, when they’re, um, if they have concerns and also like, I think truthfully is like kind of looking inward. It’d be like, okay, maybe I need to do a better job of like getting to know them so they feel comfortable. Yeah, I mean again, it’s a real, you know, like we, we’ve gone to like 50 people from, from like 10 a year ago, so we have a ton of people and so it’s, it’s me spending more time, um, you know, really like a spending more personal time I think with a lot of the employees and um, yeah, I mean we’ll see how it all manifests, but I, I think there’s definitely stuff like as like a leader that I’m, that I always can be like working on to bring the best out of RTP.
New Speaker: 00:18:31 Well the fact that you learned something about yourself that maybe you need to spend more time with them and to get to know him better is a win right? Alone. So how do you, how do you manage 50 people? Because I think this is a, this is something, you know, and these are a lot of Va’s, I take it in remote areas and stuff like that. So, uh, you have, you set expectations, they, you know, you manage those expectations. Walk us through kind of how that works and how, how many, and I think this is a reasonable question, how many va’s can you personally manage or do you have to have for every five, an overall va above or something like, can you walk us through that?
New Speaker: 00:19:10 Yeah, yeah, definitely. So, uh, so we have, I guess, yeah, maybe it’s easier to start with like kind of the goal part. Um, so basically at the beginning, uh, or sorry, the end of last year, we decided to, um, just of like, okay, ours, so there’s like objective key results and then like the big kind of like lofty goal for us was to hit 2 million Ebitda this year and um, so they kind of bring it up
Fernando: 00:19:37 back. So like a lot of people were always focused on revenue. Uh, a great vanity metric, which I’m sure you see all the time, but um, but for us, you know, we’re caring, we care way more about. I’m more of a profit in the business.
New Speaker: 00:19:51 Let’s explain what he, it means, because people don’t know what earnings.
Fernando: 00:19:54 Right. Alright. So if you take a, let’s say you’re starting on the profit and loss statement or the income statement, you’re going to have all your revenue at the very top and then you’re going to subtract out all your cost of sales. So that’s your cost of the product freight. Um, if you’re on Amazon, like the Amazon referral fees, the Fba fees, and then after that you’re going to get to your gross profit and then you’re going to subtract out all of your operating expenses. So that’s like advertising your office car, meals, travel salaries, um, contractors, all that stuff, and then you’re going to basically get to your earnings before interest tax depreciation. And I’m more decision that’s Ebitda. And then, so if you’re eventually looking to sell a company, uh, it’s usually off a multiple based on your Ebitda. Um, and then, yeah, the only things that are below that, like in terms of the income statement
New Speaker: 00:20:48 yet it’s like the, um, the depreciation of the organization. And then like, uh, your interest if you have like credit cards or loans, things like that.
New Speaker: 00:20:57 Okay. All right. So people get that, right? So it’s basically your net income minus or add back the, uh, your depression. Most people would have depreciation, maybe some interests, I guess if they’re borrowing money. So those two things added back. That’s a real multiple. That is he saying that companies will use, they’ll times it by that multiple depending on what type of business you are. And right now the, I’ve seen Amazon businesses going three to seven times that multiple. Are you seeing that in your world too?
New Speaker: 00:21:28 Uh, yeah, I would say dependent. Definitely dependent on the size. Uh, yeah, absolutely.
New Speaker: 00:21:34 Okay. And so imagine that if you’re going to hit a $2,000,000 Ebitda at a three to seven, depending on what kind of, you know, if it’s private label, if it’s wholesale while the rest of the nuances individually to your business, that is a serious amount of money at the real high end. Plus that doesn’t include inventory, never includes inventory, never includes any of that other stuff. Um, and so, so you can be talking to some real business now. I mean, you’re talking 2 million is a goal. That’s a real business.
New Speaker: 00:22:01 Yeah. Yeah. It’s crazy. I mean, from where we were a few years ago, it was like not even imaginable to be. Okay.
New Speaker: 00:22:08 Well, but that’s so cool though. I mean, who had the vision? I mean, when who cast that vision?
New Speaker: 00:22:14 Yeah. In terms of the goal.
New Speaker: 00:22:16 Yeah. I mean because I think that it’s not like, I mean that’s not like some arbitrary and it’s a big goal. I mean that’s a big, what do they beehag where they call those, right? That’s, that’s pretty up there.
New Speaker: 00:22:29 Yeah. I mean it was both my business partner and I, uh, so, um, yeah, so we’re like best friends from college. We’ve worked together previous startups and then now we’re doing this together in Yemen. We just kind of looked at her sales from last year and then I’m like, like I mentioned briefly, we do have like a new retail division, so we kind of looked at like all of our previous growth rates and like how much cash we could raise and all that kind of stuff. And then, um, use that to like help us like forecasts and then, um, you know, part of like, okay, ours is that you want to set goals that I’m like, you’re supposed to hit like 70 percent of the units. The way that Google does it is like if you’re always hitting 100 percent, then your goals are too low. Right. Exactly. Exactly. And so, yeah, I mean we’re definitely on track. So I guess we did set it a little bit too low. Um, but yeah, I mean that’s um, that’s kind of, we had like a whole day kind of planning session where we kind of forecasting, no, I’ll read you the org structure did like all this stuff, like on the kind of working on the business. Um, and then we kind of laid it out to the team over the next few days and then it got distributed out.
New Speaker: 00:23:44 He knew as I sit and to this, this is big corporate America kind of talk, you know, being an old cfo like myself, you know, this is what we used to do, a big strategic planning. We’d go off site and we do all these giant things and you know, comp calculator, a compound annual growth and do all these projections and stuff. Where does this come from? Where’s, where’s, who went to business school? Who got the business? School of life education? Who’s got that?
New Speaker: 00:24:10 Well, we both did undergrad business. USC actually, I think it helps a little bit. Uh, and yeah, it’s funny because so like, um, way back when and almost like in another life now
New Speaker: 00:24:23 when I first heard socks older than you in another light, cut me a break.
New Speaker: 00:24:29 Uh, but yeah, I mean I graduated, I worked in finance for a year and a half and it was terrible and there was all this like, yeah, exactly like corporate and like, you know, all these kind of business school in terms and I hated everything about corporate. So then then the, I went to the polar opposite to tech startups and uh, you know, did like 100 percent commission rule. Actually Nick did it with me too, like we both did it. Um, and then so I was like in startup mode and like, yeah, just hating all the bureaucracy and everything like afterwards and never wanted to go back. But now it’s interesting seeing like as a, as a business owner and you know, trying to move into like a mid market company, it’s Kinda hilarious now bring some of that stuff back, you know what I mean, like a little bit of chain of command and like, you know, a lot more planning and strategy and like, uh, you know, trying to find the right meeting balance and all that kind of stuff is pretty interesting and crazy.
New Speaker: 00:25:25 Yeah. But you know, what, here’s the difference. So in it, and I would agree with you because it’s like it didn’t make sense to you then shame on that company because they didn’t create the vision, uh, well enough for you to understand our, I guess maybe that’s not the right way to say it, but they didn’t communicate the vision well enough for you to buy into it. So you resented it, you got it. I was like, no, why would I help? Blah blah, blah. Now you’re on the other end of it, you see it, so you have to take a different role, right? You can still have all those other things because they probably make sense, but now you’ve got to communicate well to everybody on your team, so why they need to buy into it because of the importance when they see that, I think that that’s a, that’s the healthy dose that corporate America is missing what you’re describing.
New Speaker: 00:26:08 That’s the piece they’re missing because they’re still jamming it down your throat. Wow. You know, we get rid of the bottom 10 percent of our staff, no matter how good they are, because we’re that, you know, I’ve heard that for how long would that be? Right? Yeah. Ge is in deep trouble right now. Why? Because they got rid of the bottom 10 percent of their staff because of all that and it got big bonuses. You can’t do that anymore. And I think the fact that you have that perspective is very healthy. How many companies would you say you worked for? I’m going back all the way to finance and all the tech startups and stuff. Just just, and I’m not going to judge you in a negative way, I mean this is a positive and I just want to know,
New Speaker: 00:26:41 uh, I worked three.
Fernando: 00:26:44 Okay. How about your partner? But uh,
Speaker 6: 00:26:47 uh Huh.
Fernando: 00:26:48 He worked poor three as well.
New Speaker: 00:26:51 Okay. But at a young age, most of us. Your parents and your grandparents for sure. Now I’m really dating myself. There were, they were going to be one company and done find the right company. Fernando, this is it. Did you work their heart? Keep your nose to stay ahead. Trouble and you’re going to make it one day, right? I mean it’s so different. Yeah.
New Speaker: 00:27:09 One hundred percent, 100 percent. So sometimes when I was, my mom really believes in education, so sometimes when I come home I’ll see some like Stanford Business School magazine in my room or subtly very subtly trying to remind me that I should go back and get my mba and stuff like that. Yeah, it’s funny, but yeah, you’re totally right. I mean we only worked for a handful of years before starting the company. So, uh, we didn’t like. Yeah, I, I, this is the first company that I’ve actually made it two years, like I never made it. Yeah,
New Speaker: 00:27:41 I think about that now all this old guys are like, Whoa, because you know, most of us work for the same company for 20 years and then usually you’re pushed to the wayside. And Mike, my case, nine of the companies are no longer business. I was in an industry that’s gutted. Nine of those companies are no longer in business and you know, I, I chose to leave the last one, but it’s just like, I mean they struggle. It’s just a terrible world. So there’s older guys listen to this. Are older ladies listening to this right now are saying, man, you know, imagined going for two years being the longest that you were employed somewhere. But in today’s Day and age, because you know, let’s face it, for Nana, you have options, right? If you don’t like it, you don’t like the writing on the wall, you don’t like the rules, you just go somewhere else. You’re in demand, you have skills.
Fernando: 00:28:30 Uh, it would be hard to go back to being employed. But yeah, absolutely.
New Speaker: 00:28:34 Well that’s a double edge sword though for you now because you’ve got to keep those 50 people
Fernando: 00:28:39 on your team. Uh, I met her, I mean it is like a big responsibility and I, you know, as an employer, I definitely feel that pressure, but I feel like um, we also are, are really good at vetting like people that, that we know will bring value and improve the company from where it is today. And so I feel I feel really good about like the 50 people that we have, like I think they’re super talented like in their respective fields that are way better than me and uh, or like way better than like a, like, like are the rest of our team. And I didn’t. That’s what excites me about having these people is that yeah, we have a pretty rigorous interviewing process and like I am. Yeah, I just really happy with our team.
New Speaker: 00:29:34 Well, I think the fact that you’re investing in them and helping them understand themselves, understand their skillsets and like you say, discovering new things about them to realize, wait, steve is an extrovert. Perhaps there could be a different role for him. When this opportunity comes up, you get to present it to me. Now all of a sudden I feel, Whoa, you care about me. I think these are all, you know, when, if you were trying to do this by yourself, right? Without a business partner, do you think it’s possible? Be Honest. Do you have it in you? Do you think you have it in you to be, to this scale?
Fernando: 00:30:08 I think it’d be way harder. Um, I, I, I think yeah, to this scale, like A. Yeah, I definitely think you need it. But yeah, I would need a business for like, nick, I’m the would like, yeah. So we can kind of divide and conquer and everything and I mean there’s times where it’s really tough. Like, I mean, I don’t know if I mentioned this, but like in like our year two, like we had to lay off some employees, so that was brutal.
New Speaker: 00:30:37 Wait till that means you failed your. It’s over. You failed. Life’s over as you know it. It’s not. I mean, I’m being facetious when they say that, but that means that something didn’t go as planned. You mean that happens in business today?
Fernando: 00:30:52 Wait, hold on. This is news to me. It was tough. So yeah, I mean I think we’ve definitely learned a lesson in terms of. Yeah,
New Speaker: 00:31:02 it was a lesson. Well that’s a good one. Don’t, don’t drop that there. Dude. You got to give me that.
Fernando: 00:31:06 You can’t, you gotta share. I mean honestly it was really focusing too much on revenue. I think we care way too much about revenue. We weren’t paying attention to margins and not enough. Um, and I think uh, we didn’t have good enough data all the time and so yeah, I mean like it was really tough but you have to let go of a few employees here in the U. s keep like a handful that were more analytical and then we really focused on just making sure that all of our reporting was like hundred percent accurate. So like the profitability of our products and like all of our like Roi numbers and things that you think are really, really like school. But like in, in the year before, we were so profitable, like we didn’t even pay attention, didn’t really like care. And then, uh, yeah, we ended up bringing on like a part time developer that helped us use the Amazon Api is to actually build out our own dashboards, like different than everything else out there based on like the way that we wanted to see their mentors. And I didn’t, that’s been like a huge help in terms of like our growth and our, just like visitability into, into everything.
New Speaker: 00:32:23 Well, I think this is a very adult thing for you admit your tech finance guys and you weren’t paying attention to the finance and yet you were technical. So you had all the tools and mentally you had all the skill sets, all the tools you should have 100 percent been. But yet because life happens because you get distracted because of business, um, you get away from it. And I think it’s so powerful that you went back and looked at it and mature, mature enough to go back and look at it and say, hmm, we didn’t do this right. Let’s do it right. Is that now an absolute for you guys? I mean knowing what you know means this? No, going back.
Fernando: 00:33:01 Oh yeah. There’s no going back. Yeah, I mean I think yeah, focusing like, especially in like the physical products world, like yeah, I think sometimes you hear about these kind of like lost leaders and the Gillette model and like razor and everything, but like, yeah, I mean I’m pretty sure Gillette is owned by P and g so they can like, they can stomach those types of those marketing like I’m kind of like I guess schemes or campaigns to like to make that work, but I think if you’re. I knew like kind of entrepreneur, like he needs to really care about your margins and if you don’t like you’re going to get in trouble.
New Speaker: 00:33:40 Well let’s add some value because I think this is a very good step, so your scaled bigger than a lot of my listeners would be, but they would like to get to where you are. At least some of them would. I don’t think they all would. I hope they all wouldn’t. I hope the ones who want to get where they want to get get there, not, not necessarily here. Um, what, what’s an approach that somebody can take in a smaller version of this because I think this is really important that people don’t know what they’re doing with their own numbers. What’s, what’s advice you can give for somebody who is probably struggling who saying, hmm, what can I do at a smaller scale to get control of my business?
Fernando: 00:34:18 Yeah, that’s a good question. Um, I would say, uh, I think hiring overseas has been a huge, huge help to us. I think in terms of like in the beginning, uh, you know, everyone kind of the diversity of a outsource is kind of the customer support, the administrative stuff, the simplest task, which I think is the right place to start. Um, but you know, will we realize that the Philippines is a massive country, like there’s a ton of really, really smart people that we just need to find a way to, to attract them, to join us and to, to train them like, you know, specifically on, on Amazon. And we ended up finding was that literally every single role that we’d ever dreamed up there was people like I there that were better than us at those specific roles, whether it was logistics, inventory planning, um, know finding new products like finance, you name it.
Fernando: 00:35:26 And so we’ve Kinda like built out this amazing team, um, but kinda scattered over the world now we have people in Latin America, we have people, I’m in the Middle East, Eastern Europe, like you name it, like we’re looking more globally. And then so I think like as you’re, as you’re kind of starting out, it’s like, okay, figure it out, okay, these are the things that I’m really the best at. And, and then also make maybe make a list of the things that you think are the most important for the business. And then you should only be doing things on those lists and then everything else you outsource or like get somebody else to handle it. Then,
New Speaker: 00:36:06 because this is important, you said that these other people are better at some of these roles than you were. So even that list, eventually you could pare that down, right? Because then you have to be mature enough to admit that, you know, yeah, I have an accounting degree, big whoop. Fernando’s 10 times better at it because, you know, whatever. You know what I mean? That’s his lane. Right,
Fernando: 00:36:25 right. Totally. Yeah. I think as a, as a first time, like, you know, entrepreneurial, a lot of people are very reluctant to let go of like certain certain tasks that they feel are our only big can do. Like I think product development, I hear that all the time in terms of ambulance or like only I can do that. And it’s like, okay, like maybe it will take a few months, six months to train somebody, but you’re not the only person in the world that can do this because there’s, you know, hundreds of thousands of other entrepreneurs that are also able to figure it out. And so I think, um, is, is having that like restraint to be like, okay, I can’t do everything. And so if this person’s focused a hundred percent of their time and they’re really smart, like will they do a better job than if I’m only spending like five, 10 or 20 percent? And I think once you look really embrace that kind of methodology, like it’s way easier to scale no matter where you’re at in your business.
New Speaker: 00:37:30 It’s so powerful that you just said, that just blew my mind. Do you right when there are 100 percent, if they have the abilities first off that you, you’ve added that night, that’s what you do your work up front. But if 100 percent of their time is doing that, you’re telling me they can’t come up with a thousand percent improvement on a mouse trap or whatever it would be. Of course they could write because that’s all they’re doing and where you’re giving it a little bit of time and then you gotta to go chase your kids or you got to go do this or wait, I gotta go pay this bill. Or I got to go, I got a problem with a shipment I got to do. Right? Oh Dude, you’re too young to be this sap. Alright, let’s talk about this because I think this is another skill set and I think this is where a lot of this approach comes to.
New Speaker: 00:38:07 Again, and I say this for us, old people and I teach myself, but I say this all the time. Computers didn’t come in into my high school until my senior year, halfway through. They did not bring a computer into our school, so imagine and the math teacher was a computer teacher, like, you know, like you need to go. Yeah, that was it. And so you guys have this huge advantage you’ve grown up with probably, you know, a computer in your bathroom for God’s sake, right? There’s, there’s something everywhere you guys have, but that’s a big advantage. And so the tech world, I think that one of the interesting things that I really liked about your story was taking a tech approach, like taking that tech mindset into the ecommerce world. I think that that, that mental, your ability to break things down into manageable tasks and things like that I think is just such a powerful thing. So let’s talk about that and what you’ve been able to to glean and then apply into ecommerce for us.
Fernando: 00:39:04 Yeah. I’m actually, it’s a one that, um, I guess one I guess saying uh, that I was actually talking to my girlfriend bought is that I really love and it’s like done is better than perfect for sure. And like I think that’s, you know, a lot of like I’m not a professional by any means. So like I don’t have this problem but I know a lot of kind of people, if they’re putting their name behind it, they, they’re constantly like waiting until perfection to kind of launch something. And I think like that is like the opposite of the contact mentality, like tech mentality, you know, a faster growth like really always focused on like how were really quick turnaround, like metrics, like kind of leading indicators of where you’re going. And I’m keeping everybody aligned with that. And I think there were like, I guess tech people are really good about that.
Fernando: 00:39:55 And so I think um, so then we bring a lot of that experience which helps us stay on top of it. And another thing that we do, uh, that I think has been really, really helpful for us is kind of these 90 day sprints. So I mentioned earlier, uh, yeah, we have like the $2,000,000 Ebitda goal and then so you can kind of work backwards and like break it out. Okay. Look, this is going to be q four, q three, q two, q one. And then for, for us to do that, we to um, you know, launch this many products. We need to bring, you know, maybe our op ex down to this percentage, uh, and then you kind of break it out into a kind of bite size goal is by quarter, then by month. And then he was signed every single thing to a specific person.
Fernando: 00:40:43 Um, and you know, when you’re a smaller team, you know, maybe you’re taking after them and you know, uh, your business partner is taking half or you know, your right hand person is taking half. But then over time, like, you know, it’s getting broken out to more and more people. Um, which is really helpful. And there’s a book that I just finished a, it really talks about a lot of these kinds of scaling things called scaling up, one of my favorite books in the world. And um, yeah, I mean it talks a lot about this type of planning, which I think is really, really helpful as well.
New Speaker: 00:41:14 I think. I think it gets again, you know, hey, if you’re clear, this is our goal. Okay. And then this is your role within the goal. We need you to hit it and then boom, if everybody does that, but what magically the goal gets met, right? I mean that’s pretty simple math, right? At 100 percent of people hit their goal and their goal was clear and defined and they all hit it. Guess what, overall you hit your overall goal, um, how do you, how do you spend your time then working on your business when businesses happening so much around you? Because you guys have a lot of moving pieces when you’re describing 50 people and hitting that kind of revenue to get a $2,000,000 Ebitda means you’re doing some huge sales, uh, lots of products, especially if you’re launching a lot of products. How do you, how do you find time to work on the business?
Fernando: 00:42:04 Um, honestly I think it really comes down to hiring great people. I mean I the for let’s say, new products. The only thing that I do now at this point is I approve products,
New Speaker: 00:42:18 so somebody else’s bringing the product to or developing it. Hey, I’ve got an idea, I’ve got this looking at my desk, I’ve got this scale, I’m going to bring this new scale. There’s, they do the research, they helped develop the product, they do all that different stuff or somebody does alone. And then at some point it comes to you with all these metrics that you’ve requested over time.
Fernando: 00:42:41 Exactly. Yeah. I mean literally I just get like a screenshot and it’s Kinda like, oh, this is what we’re, we’re planning on selling about. This is like the final pricing from the supplier. This is going to be afraid, this is going to be our FBA fee. He’s like, ah, this is like everything laid out like, and meets our margin and our requirements. And then I’ll just like, here’s the top keywords for it. I’ll just check the keywords like, okay, this like, this makes sense. Like green light. They send the payment. They, uh, we have like a project manager follows up with the supplier to make sure we have a logistics person that um, you know, make sure it gets to the US. Uh, and then we have like a whole, like listing team a key, you know, keyword research, all that stuff like the photographer. It’s all handled on American. Like I don’t touch it at all.
New Speaker: 00:43:28 Oh my goodness. How long did that take to set up? Because everybody’s sitting here, right with their mind blown right now. They’re saying, wait, wait, I can’t do that because they’re coming in with 100 reasons. I guarantee you that why that won’t work. Right? I know. I guarantee I’m sitting there thinking to myself, wait a second, how do I communicate that? Who’s gonna who handles the money? Why don’t they just go make it themselves? So why do they come in to me? Why are they using, you know, all the different things that every single person’s going through their head and a man, this is real. How long did it take you to get to that place to get people that actually have the ability to do that the way you want?
Fernando: 00:43:59 Uh, that’s a good question. I mean, I would say it took us maybe two and a half years.
New Speaker: 00:44:07 Okay. That’s a real estate. I was thinking two years, but two and a half years of hit and misses. Right? I’m sure that was ms.ms.ms.ms.ms.ms dot. Oh, got a little then hit hit hit ms.ms dot. Right. I mean that’s. But isn’t that 100? Was not small incremental improvements. I mean that’s really what it is.
Fernando: 00:44:26 Exactly. Yeah. I mean you’re just always learning. Always kind of. I’m just testing honestly
New Speaker: 00:44:32 because I mean, you’re never going to be 100 percent perfect, but if you’re really focused on building systems and creating criteria, I think that was a big thing. It’s like, okay, well what is our criteria for products and which ones have worked in the best in the past and like kind of, okay, like let’s, let’s try this. And then really being like, focused on that, uh, or disciplined on that has been instrumental for us
New Speaker: 00:44:59 I think. I think that’s just so cool. But I think it’s. So when you think about it, I mean it’s, that’s huge. I mean it sounds almost impossible task to tackle. I mean as I sit back and think of this is big, you know, this isn’t like, I mean you’ve got an r and d team mean in theory, right? I mean you’ve got, which, you know, think back to the GDS will use GE as an example. They probably have thousands of people in their r and d team at one point, you know, and here you’ve got what, half a dozen
New Speaker: 00:45:34 r and D is only two, including sourcing is two people. One person that comes with the products, I’m one person that sources of them and they’re like a team.
New Speaker: 00:45:43 Think about that, you know, you go back to Ge, they would have had giant that thousands of people and you know, and go back to Gary Vee, 99 percent of the ideas never made it past the gatekeeper. Right. So how many great ideas, but because of that gatekeepers biases and you know, their thoughts, 99 percent of those ideas just got shot down and there could’ve been some gems and I’m sure there were some gems that nobody ever thought of to get past. Right. And that never made it up. And in your scenario because they’re able to get it and bring it up to you, one of the owners, you probably see some things like, holy crap, I would’ve never thought of that. Right,
New Speaker: 00:46:22 totally. I think it really just goes back to the, to the hundred percent time thing, you know what I mean? Like I as like a founder, like I shouldn’t be spending more time with like, you know, financing options and recruiting and setting the vision and kind of like where the company, like those are probably the three things that I should be focused on.
New Speaker: 00:46:44 Let’s say that again, I want to hear that again because I think this is important. So for you, you believe your role should be today given the size of the company being the scope that you guys have. Plus you have a strong partner. So, but let me hear that again. What you think your role is?
New Speaker: 00:46:58 Oh, recruiting number one. So look at ensuring that we have like the best possible team in every fashion. Uh, number two is like securing financing. So not actually like managing the books or anything like that. But like if we need to raise, you know, like let’s say more debt for instance, then like making sure that happens. Um, and then number three, and this is not necessarily in any particular order, but he’s like setting the vision, the strategy, like understanding where trends are moving and um, and kind of like laying the foundation for the next two to three years.
New Speaker: 00:47:33 Do those three things. This is a mature business that only a couple of years old. I mean, do you realize how long it takes most companies to get to that level of structure to get that level of understanding? Do you think it’s a huge advantage? I’m being an ecommerce business to be able to do that mean because it can you imagine like let’s use, for example, toys r us, right? They have a, I don’t know how many stores they closed, was it 800 stores or whatever it was. Each one of them are leased through different terms through a different company, right? Each, each one. I mean, can you imagine, you know, the, the, the layout and the, everything about them is different because you’re so, you know, an online business generally most of the time, um, how nimble you are, you’re not constrained by all those boundaries. So the ability to adapt to this type of model so quickly I think is such a huge competitive advantage. You get what I mean?
New Speaker: 00:48:29 Yeah, totally. Yeah. I mean, um, yeah, towards the rest of such an interesting case. Yeah. I mean I feel like I finished the everything store a few months back and yeah, I mean I didn’t like their reluctance to, uh, to move online and having Amazon manage like their online portal was probably the nail in the coffin even though it happened like a while back, you know, because like things were moving towards ecommerce, like Jeff Bezos knew that and I think them not like placing a big enough importance on it early, early on. Enough is like, is not. I mean obviously hindsight is 2020, but I feel like that was probably um, the part that it’s like, yeah, I mean now a now it’s easily visible.
New Speaker: 00:49:17 Yeah. It’s Netflix and a um, what was the blockbuster? Right. It’s the same thing. One hundred percent totally put all their chips in. Is it a risk then as you say that I just, it dinged in my head. Are you making the mistake, you mean me to by relying on Amazon to be your partner for your brands, right? I mean because you’re giving them all the customers. Is that a mistake?
Fernando: 00:49:43 Totally. I mean that’s a very realistic concern for I think every Amazon seller, especially in private label because you don’t really have as strong of a brand. And so I think to me there’s kind of two approaches, um, and so one is that you could build a really strong brand with like a social media following and maybe your own shopify store and all that comes up. I think that’s one approach. The other approach, which is the one that we’ve decided to go after is not being so brand focused. And so we launched products in tons of different categories, tons of different niches. And the idea is that like we’re really so that if, I dunno, Amazon comes in on one niche, like that’s okay because it represents less than five percent of our total profit. And so we’ll just take that money and redeploy it into something else more similar to like what a finance company would do.
New Speaker: 00:50:44 But I think you said something here that’s very important. You’re not going from a scared point of view. What if Amazon shuts down my account? No, because you understand that you’re bringing value. You’re saying, hey, what if they changed the game and they happen to come into our marketplace or, and sell a similar item. That’s a different thought process and I think it’s so healthy that you guys are thinking that way as opposed to what if they shut down my account, why would they want to shut down your account? You’re giving them a gazillions of dollars of revenue, right? I mean, if you’re making 2 million bucks, Amazon is making a lot of money. I mean, that’s the way you got to think about it. That’s very healthy.
Fernando: 00:51:20 Yeah. Um, yeah. I mean, I think there’s always a kind of fear like in your mind. But I think it’s one of those things that it seems like ti to overpower. I mean, I see it in the facebook groups every single day. Like I haven’t sat down and everything else. And it’s like, I mean, I think it’s um, or what happens if this happens, like, I mean, it’s just not something that I would dwell on. It’s like thinking about like, all right, well, what can I really do to, uh, in that worst case, like, and then move on and then like maybe go on Walmart because that’s like super easy, um, to um, to do with certain services and all that kind of stuff. So I think there’s just so much opportunity. Commerce, it’s not worth dwelling on all the things that could go there.
New Speaker: 00:52:05 I think those days of them being the heavy hand, I think, you know, you see a kinder, nicer, you know, you start seeing them out at meetups and stuff. Why all of a sudden, well, because they realized that heavy hand can only get them so far that there are other options now. And so therefore, you know, kind of if they were that done is better than perfect, they’d launch and then they go figure it out. Right? And then they’re in that figuring out stage now. So I think that’s absolutely fair. Do you get to spend, do you have any of your team, I mean, I guess you kind of Said you do, you’re trying to create visionaries, but do you have any of your team working on adding a Walmart and writing? I’m sitting there thinking about that is as you trying to build out, you know, because you’re diversifying so much, is there a, is there somebody who’s working on. Because diversity, diversity is not the right term because that’s not the same thing. That doesn’t mean the same thing, but figuring out other ways to take advantage of your existing products, skillsets and things like that. Do you have anybody who’s working on that?
Fernando: 00:53:05 Oh yeah. I mean we have a ton of people. Um, I mean we, uh, we have a team that’s a more of a sales team that’s kind of looking at bringing on my consulting clients to kind of show like, or to kind of use like the skillset and the technology that we’ve built out internally. Um, we have the retail team, uh, that I mentioned and so they’re taking a lot of our more unique products. Uh, and then bringing those into brick and mortar retail since we already have like the three pls and the suppliers and like the whole supply chain set up. Um, and then yeah, both nick and I are always coming in trying to identify like where the market is going and then veering out like how we can, um, yeah, I guess how do we take advantage of that and like try to be early into the next thing.
New Speaker: 00:53:59 I think it’s very healthy. It seems like you invest a lot of time into reading a lot. And what percentage of your time are you spending, you know, physically doing things as opposed to learning we’re investing into yourself and into your business. Do you get what I mean? You know, uh, because I, like I had somebody who does Jujitsu and does, he’s teaching Spanish at episode. Hasn’t come out yet, but it will. I mean he’s, he’s learning Spanish. I mean he just invested so much in his personal time. And so when the challenges of this business come up in their everyday in your world, you’ve got to be putting out fires a lot of the days. Um, they just flow because he’s so balanced with his head doing these other things. It just gives them the ability to be focused. What percentage are you doing?
Fernando: 00:54:45 Oh, interesting. That’s a great question. Um, I would say in terms of putting out fires, I can try to keep it like minimal, like maybe 10, 10 percent. Like if anything, like I usually will only step in if they can’t solve it. So I never like really a step in as the first kind of Line of defense I guess you would say. Um, I would say in terms of like learning maybe maybe two hours a day that’s been like, yeah,
New Speaker: 00:55:19 really tried to like read and um, yeah, trying to figure out what’s going on in, in the overall space.
New Speaker: 00:55:26 Like how do you break out two hours? I mean, I think this is important because I don’t think people. I don’t, I don’t think people would say they have two hours. Fernando, I don’t think they would say it.
New Speaker: 00:55:36 Uh, yeah, I mean I think honestly it’s about really freeing up all of those day to day tasks that a lot of people would hold really close to. They’re like, I don’t like, I mean one of the things I recently got rid of, it’s like pay down the credit cards. I mean even though it’s like a super like quick task, it takes me whatever, like maybe five minutes to like to pay them all down. Like um, yeah, it’s all done by somebody else that I, that I trust on the team that’s checking, you know, like, uh, the big statements and like the, the cashflow statements and all that kind of stuff. Um, and yeah, so I think I’m really an empowering your team to do everything possible so that you can really focus on the most important things. It has been like the biggest transition for us that allows me to spend time like, like either learning or working on,
New Speaker: 00:56:30 on the business. It’s very powerful what you just said that though. Maybe just think about that. You’re saying, hmm, yeah, I, you know, it’s only five minutes to do the credit cards, whatever it was, but wait, it’s more than that. It’s preparing, it’s remembering to do it. It’s all these other things and if you say, wait, I want to spend two hours, I’m going to take boom, check, there’s five minutes plus all that additional time plus, and so I think it’s, again, this was a maturity issues, being able to say, yeah, I could do it, but why do I need to? And as you said earlier, wisely is that person who makes that their job, they’re more likely to find things that you might miss because that’s their job. Right. You get what I mean, because they’re going to focus as opposed to you rushing it.
New Speaker: 00:57:12 I got to rush, I got to get to this meeting or whatever. Boom. Now they can give it the time that it’s necessarily, dude, you do have some knowledge. It’s just very cool to see this application. I, it’s very cool to see this application being applied to this business. It’s kind of scary to me a little bit. You know, it’s funny. I’ve had a few tech guys on and they’re there in your designing apps or whatever it was. I forget what it was, software, you know, to create software and I’m like, why are you guys in this world? Then you go, well that’s because Amazon is the hot place to be right now. And he said it’ll be something else next year or the year after and we’ll all move over there and started applying our skills and trade to that. I think it’s, it’s kind of interesting, kind, kinda maybe a little worried for some of us to see more of you business finance, tech type to come into our world because you’re doing all the things we know we should be doing, but we’re not, but we’re not totally.
New Speaker: 00:58:08 But hearing you do it, I hopefully a whole bunch more people are going to say, you know what, this is very powerful. Um, the last thing I’d like to talk about because I really do appreciate that that mindset is about scaling. Now you mentioned that we could talk about scaling to eight figures. I don’t know how many people. I think there were a lot of people that are still in the six figure range and we’d like to scale to seven figures. I think that probably be more of my listeners. I mean, uh, as, as nice as I’d like to believe there are some amazing outliers out there, but the ones that I tend to help more are the ones that sell in three, four or $500,000 and wanting to get to that seven figure number because it’s a different business at seven figures than it is at half a million dollars. Right, right. So what could you help us with for people who are there who want to scale to that seven figure mark? What would you, what would your, some of the things that you guys did and things that you think that would apply well to my audience?
New Speaker: 00:59:05 Yeah. I mean I think if you’ve got a few years in business, like maybe two years of tax returns and they’re profitable at the six figure mark. Yeah. I mean, one thing that we did, which was tremendous for us back in the earlier days,
Fernando: 00:59:22 we got an sba loan and so we got like a really sweetheart deal, but a time when prime rate was a little bit lower, we were paying about six and a quarter percent. It was, yeah, it was really cheap. Not was like seven and a quarter maybe, but it’s not bad by any means, but it was a 10 year loans. So we got $350,000 and our monthly payment was only four grand. And so you kind of that to like an Amazon loan or you know, he’s just like merchant, like a account loans or whatever, like immersion advanced loans, uh, is, you know, basically a ridiculous, ridiculously cheap. And um, and so I would say, um, that’s been a huge help in terms of scaling. And then on top of that we took on more promissary notes. So yeah, I know we talked about like a debt, like a little bit earlier.
Fernando: 01:00:14 Um, but yeah, I mean we wanted like that risk and we were that confident in the business that we could take on a promissory notes to help us scale. So I think that was a huge, huge help. Um, and then I would say like maybe the second thing is, is again, like if you’re figuring out what your biggest growth drivers are and then really trying to spend as much time as you possibly can doing that. So like, you know, if you’re an Amazon business than a lot of it’s through new products. You know what I mean? If you’re, I don’t know if you’re in the drop shipping business, maybe it’s new suppliers. I’m not, I’m not 100 percent sure because I’m not in that space, but like is really figuring out like okay, this is what’s going to get me to like, uh, to the seven figure mark and then like setting up a kpi for it and like really being 100, 10 percent focused on that.
Fernando: 01:01:09 And then as much as everything else that you can push off like a delegated to somebody else, train them so that you’re not doing, even if it takes five minutes, train him how to do it once because like most tasks or not one time, you know, paying the credit card like happens every month and like, you know, all that kind of stuff. Like it adds up. Like don’t think about it as like, oh, this is a five minutes, one time, it’s like five minutes for the next five years, every month and uh, and a. and then be at creating an sop, creating systems so that you can really scale the business.
New Speaker: 01:01:44 I think your advice on the debt, not a debt fan. I’m not a, we don’t borrow money, but I think it’s very solid the way you described it. You’re like, wait, you get a couple of years of tax returns, there’s the solid advice right there. So this is a business that proven that you’ve been doing it for several years, right? Then getting those financial statements in order because the spa is not going to take, you know, just crappy, nonsensical financial statement. Good strong financial statements is what banks finance and so having those put together over time to show growth and show all that ability I think is very, very, very solid advice. I think the 10 year plan is very smart because it gives time. You’re built out a plan, right? So you have a 10 year plan. If you’re taking debt for 10 years, you have a plan and so that told you the ability to do that.
New Speaker: 01:02:27 I think that’s very sound and very. You’re one of the few that don’t say go borrow everything in bed right now. I think this is very smart. I think. I think that’s an absolute smart thing. I like the other thing too, is to take those five minute task and multiple high amount for five years and then realize, wait, this is, you know, 30 hours of my life I’m going to get back for this one dinky little credit card statement. I get 30 hours of my life. What would you do with that? $30. How many books did you read in that? Thirty hours, Fernando? Right. That’s real. That’s real when you say it that way, dude, you’re making me think. I love it. All right. So what’s next for you guys? So you’re scaling, you’re, you’re building on teams, you’re adding other marketplaces. Um, what’s next for you guys?
New Speaker: 01:03:15 No, I mean, that’s a great question. I mean I see a ton of promise in our retail division, so I think I’m super, super excited. Some of more parts are going to be on hsn. Um, yeah, we’re in talks with so like it’d be cool to, to kind of go from this new school, you know, online Amazon space and then kind of like kind of breaking down the doors and trying to figure it out. Like the more traditional side of physical products. So I’m, yeah, I’m very, very excited about that. And um, yeah, I mean I’m excited about with this consulting thing and I mean, yeah, there’s just, there’s just so much, uh, I, I think to, um, to the business like, yeah, I am. I’m just overall really excited to be doing what I’m doing every single day.
New Speaker: 01:04:03 It really is exciting when you think about, you see nothing but opportunity, don’t you? I mean, it, it. Can you imagine the guys who were working at toys are the good people that were doing their best and for whatever, you know, whatever the story was, they still went to work every day believing in everything. They didn’t see opportunity. They see failure, they failed even though they didn’t. They did what they were told. Here you are in this world and you see nothing but opportunity. Isn’t it crazy to think about that? That blows my mind. I mean, it’s, it’s, we’re back to this discussion. It’s mindset, isn’t it? It really isn’t mindset approach. Absolutely.
New Speaker: 01:04:38 Oh yeah. I couldn’t. Yeah. Yeah. It’s really well put, but yeah, it’s uh, it’s totally mindset.
New Speaker: 01:04:44 And if you worked for toys r us, you have unique skills. You should be in the ecommerce world. You have skills that we wish we had you. You understand toys better than we do and therefore you should be in our world. You will kill it because you have built a skill set, you just have to learn to apply it. And so reach out to Fernando and his team. Okay. So if somebody wants to follow up and has more questions and again, I tell people all the time if you connect, if this, if Fernando, if you connect with Fernando and his story and his, his thing and that’s what I always tell people, find people, you connect with somebody who can, who, who resonates with you, what they’re saying and and see if they have an opportunity because they do consulting and you know, they, they charged for it. So it is what it is. Um, but again, you know, you have to buy time from something so it’s going to cost you time or it’s gonna cost you money, one or the other. And if this is something you’re interested in, I don’t benefit in any other way other than if you have success, man, I win just because the world is better because you had success. So what’s the best way for somebody has a follow up to get in touch with you?
New Speaker: 01:05:43 Yeah, I mean they can always email me Fernando, seller tradecraft.com or you can find me on facebook, shoot me a message and I’ll do my best to respond to, but yeah, I would love to hear from people and uh, here with a thing and if there’s any way that I can be helpful and just, yeah, of course, let me know as well.
New Speaker: 01:06:02 I appreciate that. So I’m going to have that out there. So it’s Fernando@sellertradecraft.com, seller trade craft.com. That’s the name of their company and I’m going to have his facebook contact there. Dude, I’m, I’m, I’m really, really pleased and I really thank you for spending the time with us today because again, I think it, it shows the potential of what can be when you apply it and you’re consistently applied over time. I’m an admit and an admit. Not everything works. Sometimes you have to retrench and retreat to build it out the right way and you guys have done a great job at that and I’m so impressed. It’s just such a cool story. I wish you guys nothing but success. Thank you so much.
New Speaker: 01:06:41 Thanks man. You too. Yeah, it’s been a pleasure. Thanks so much for having me.
New Speaker: 01:06:45 Great Guy. Great Knowledge. Um, love the stories. And again, I love the fact that he’s investing in his people. He’s saying, Hey, you know what? Maybe a self reflectively, I should have learned more about that team member and I prejudged them guilty, you know, and he’s willing to admit it. I just think that again, why do you think they’re having success? Because they’re willing to look inward and say, hmm, I don’t have it all figured out. Let me work on that until I do and let me reach out to others. Let me let others get involved. Let’s see what they bring to the table. Wait, magically, they have something to add to. It’s not only me. Boom, that’s maturity. Very, very cool. Business, ecommerce, momentum, Dr. Take care.
Cool voice guy: 01:07:24 Thanks for listening to the momentum podcast. All the links mentioned today can be found at incomers momentum. Doug, come under this episode number. Please remember to subscribe and like us on itunes.