On Today’s show we are interviewing a man by the name of Piyush Patel and he will share with us how he got his first customers, how he recruited top talent, his book Lead Your Tribe, Love Your Work – An Entrepreneur’s Guide to Creating a Culture That Matters, what B.A.M. stands for and much more!
Website – PatelOKC.com
ACTION ITEM: On a scale of 1-10 with 10 being the highest, how would you rate your culture? How can you improve your onboarding of your employees? How can you show your employees the path to their career success with your company? How can you mentor each person?
How does one man turn a $54 investment and turn it into a company that he later sold for $45 million of cash and stock. How does one man build an online business? We’re that. We’re $10 million with just two coders. On today’s show, we interview my friend [inaudible] Patel, the founder of digital tutors, the company later acquired by pluralsight during today’s interview piece discusses how we started digital tutors, how he got his first customers, how he recruited top talent and his book lead your tribe. Love your work. An entrepreneur’s guide to creating a culture that matters what Bam stands for and much, much more.
Yes, yes, yes and yes. Thrive nation. On today’s show, we have an incredible guest, my friend, Mr Piyush Patel, welcome onto the show. How are you, sir?
Awesome, thank you.
A page off the listeners out there that are not super familiar with your background. Could you walk us through kind of your history building, digital tutors, kind of where it all began and then where it ended for you.
Yeah, I was a sixth grade science teacher, turned, um, college professor, then entrepreneur and started with a $54 personal investment and grew it to $10 million with no investors, no debt, and then sold it for over 45 million in cash.
So, uh, okay. Well that’s the one sentence. Okay. So step one, are you fit to get, you got to gather the $54 a step to sell for $54 million. Okay. Now Talk to me about this though. Um, how did you get your first customers at digitaltutors.com and what product did digital tutors sell to the world?
Right, so we were pretty much an online training academy, much like your business school online. Uh, we were, you know, a video based, um, platform for people who make movies and video games. So, you know, the key there is niche and then niche again. And then we niched one more time. So video based training for people who make movies and video games. Got It. And uh, you know, our first customer showed up at nine o’clock and uh, in the evening, um, purely by word of, and this guy was in Israel. So the word had gotten from Oklahoma City all the way to Israel in a matter of a day. And this was before youtube, before you know, Google, it was all a word of mouth thing.
And how did you create that word of mouth? Were you doing mailers when you cold calling people? How did you get that initial, just to get the word out there? Initially you run around a Oklahoma City was a mega phone. What did you do?
I wish I wasn’t smart enough to do all of that. We followed this method of marketing called cult branding and it was really around, um, I just need to have one person who believes and then I’m going to ask them, okay, introduce me to five people who also are your friend network. And then introduced me to those five people. And then we just kept going. And really that’s how we got to the first 100 customers. We just asked our customers, hey, go tell your friends. And we looked at it as if we build a product that people want, they’ll tell their friends.
That sounds so easy. But I think in, in in execution and application, that can be very hard for people. But I think as an entrepreneur though, clay, you and I both agree it’s what you don’t know. I was too dumb to know what I was even getting into. What did I have to lose to ask for a referral? Hey, tell me some of your friends if they say no. Okay. Uh, do you have any other friends? You know,
I was just talking to Paul Hood and your team about this. Paul, probably two weeks ago and I was telling you about an insurance agent that I worked with and his whole thing, peach was after he had wowed you by saving your money and showing you all the holes in your coverage, he would just ask, Hey, are you happy with what I’ve done for you so far? Yeah. Well, you know, what five people do you know that I could help in this guy built one of the biggest insurance practices in Oklahoma by doing that. That right there is a, is a knowledge bomb for somebody out there. Absolutely. Now peace you are in Oklahoma or you were in Oklahoma when you built this company, which is known more for uh, Ag Tech, you know, agricultural tech, not necessarily Ed tech educational technology. How did you recruit coders in Oklahoma?
We recruited amazing people. A half the company was local, the other half was brought in from out of state. Um, but I’ll be honest with you, we built this $10 million business on two developers and you know, and I hear people going, well, we need 50 developers to get to a million. It’s like, no, you got the wrong 50. Yeah, we only had to, most of our people were content people. So, uh, we also got there with no, with no salespeople. So we did all of this completely organically. Uh, no outside salespeople.
I remember one time I was talking to you about, you know, search engine optimization and how you were talking about the importance of just having your blog are constantly blogging, constantly blogging, you know, just getting it out there. Can you talk to the listeners out there about the importance of, if you have a website for your business, why it’s so important to just keep creating copious amounts of content?
That’s right. It’s all about content-based marketing. That’s kind of the adage we took. We used, we had a $30,000 marketing budget, so that’s not a lot of money on a $10 million revenue business. Yeah. And the really, the angle that we took was we’re going to release two blog articles every day no matter what. And it could be anything from a video game review to a really high end technical technique that we’re going to give away. Um, yeah. So what happened is over the years we became the experts. Like we were seen not only by the search engines, but by the community that we serve as, Hey, these folks are the true experts. And it doesn’t matter if you’re selling plumbing services, if you’re doing electrical work, if you are a brick layer or if you are our doctor, I think the more content that you have out there, the more trust you’re going to develop in your customer base.
What was your wife’s role? Uh, Lisa’s role in starting your business?
So Lisa took care of all the books and she was the house mom. You know, we hire a lot of young people, a lot of millennials and I’m, a lot of them are kind of needed a house mom. So she used her background in child development to uh, help, help keep the office afloat. In terms of, uh, emotionally
Now, what was, what was the most challenging aspect of growing from a hundred customers to 500 customers? You know, as you begin to, to scale. What was the most difficult aspect of doing that?
So, and I would just be dead honest with you. When I, when I exited the business, we had 1.5 million people in the system. So the first 511 years, 14 years prior to that were just a blur. Like I said earlier, clay, I was too dumb to know what I was getting into and I just kept showing up. I mean, we hit our first million dollars literally just by showing up and working hard. And, um, and I think that’s part of the base of any entrepreneurial journey. You’ve just got to show up
now. When you got approached to plural site, reached out to you guys and said, hey, you know, we want to acquire you, merge with you. Hostile, take over. I’m not sure what the language was that was used. What was your initial reaction to potentially, you know, selling your baby, the ob great orange monster that you had built? What was your initial thought when you got approached to be purchased?
The initial thought was, it’s not for sale. I mean, we’ve never had this conversation of selling the business for us. We were serving our customer and having a great time and we loved all our employees, so we were doing what we were destined to do. Um, but really the owner of pluralsight said, well, look, if we don’t buy you, I’m just going to be really honest. We’re going to buy somebody just like you and, uh, we’re going to pump him full of cash. And I thought, oh my gosh, we’ve worked so hard to be in a space with no competitors. What’s it gonna look like? You know, is this going to be an uphill battle every day or do we merge and do something bigger? And so we decided to, uh, be acquired
four 50, $4 million of cash.
Uh, it was 45,
45 stock. So when you got $45 million of cash, for the listeners out there who aren’t familiar with this, so it’s kind of transaction. Uh, did they bring by a briefcase and is it filled with one rubber bands on it? How does that, how does that go down?
You get a little alert on your Todd, your phone that says why are complete. And that’s as bad as honestly God that is about as dramatic as it is. It’s like, oh, okay, why is complete? We gifted, we, you know, we decided instead of, um, gifting 10% something that my wife and I like to do with our income, instead of gifting it in a traditional way that we would gift it, we decided to gift it to all of our employees. So they re they received $1,000 for every month of service. And if they were on my executive team, they’ve got another big bonus. So some of them walked in that morning with a house payment, car payment and student loan payment, and then they left at the end of the day with no debt.
So you’re out there, you know, you, it will say, you know, money changes people, but I, I’ve, I’ve known you here for a while. You’ve been a kind and generous guy from, and everyone I know who knows you says that you’re a kind and generous guy. Um, have you found that uh, getting a big lump sum of money has changed you in any way? I mean, do you find yourself going for walks naked in the woods? Do you find yourself getting odd tattoos? Do you find yourself talking in movies a lot? How has it changed to
honestly, it has not changed me one bit. I’ve been this way since I was a kid. The only thing that it has made us do is become a lot more cautious because all of a sudden there’s a whole bunch of people who would now want to be your friend. And I love that. A hip hop song. No new friends. Right. My wife and I don’t need any new friends.
Do you know that’s interesting, but I read an article about President Obama and uh, again, the listeners know this isn’t a political show, but this is a thing during his run for president, one of the things he and Michelle agreed to is we’re not going to meet any new people this year because henceforth you can’t trust him. One’s motive. So we’re not going to meet anybody new as we’re running for president. And he talked about how those friends he had from back in the day when he first, you know, before he became a big deal or some of the same friends he has today, most of the same friends he has today. Um, one, one thing I have noticed though about the, the money that’s, that’s changed you as it’s allowed you to have some time and some space to create peace. Two Point Oh in terms of your career, you know, so now you’re, you’re writing books and such. Can you tell us about your book lead your tribe, Love your work?
Well, it’s really about how we built this culture and really, I think culture as a very tool in every entrepreneur’s toolset to, I think strategy is important. Executions, important, sales mark and all those things are important. But for me, culture was my x factor. And when I would tell people about our environment, how we only turned over 12 people in 14 years, they look at me and go of tech workers. I’m like, Oh yeah. And millennials at that. And they’re like, no way. There’s no way you did it. So I decided I’m going to write a book about it.
Yeah. You know, your, your book, you talk about a lot of really practical things in the book, but one of them is this concept called Bam, and we say, boom, a lot here. So first I thought maybe pieces misspelled, boom, you know, and I thought, no, that’s just a smart guy. And I started reading the book and it talks about belonging, affirmation, and meaning. Talk to us about Bam
band. It’s the band philosophy. I mean, at the end of the day, uh, people work for Bam. Every company is going to give you a paycheck and some level of security, uh, be it through health insurance or life insurance or some kind of retirement plan. Yup. But really people want to work for, they want to belong to something bigger than themselves. They just want to be told that they’re doing a good job. And at the end of the day, it can’t be meaningless work. Give them some meaning and what they are doing. And the people will stay with you forever because they want Bam in their lives.
They have no bamboo. That belonging. You talk about making your own jerseys. How to create that sense of belonging. How do you, how do you, why do we have to create our own jerseys? Talk to us about this idea.
Well, we’re all a team, right? I tell him this all the time. We’re a tribe. We’re a team. We’re not a family. Cause you can’t fire your family. You still got to show up to Thanksgiving dinner. Right? Got It. Um, but you can be a great team and great teams have a really instant way of knowing whose team you’re on. You’re the good guy, the bad guy. And it’s all about the jerseys. So I was huge fan of spend as much money as it needs to make enough shirts and sweaters and sweatshirts to give everybody enough clothes to wear every day because they’re in the community wearing our brand, supporting our brand, and I’m supporting our message. So yeah, your, your listeners, if they’re not investing in office clothing for their people, they’ve got to
no affirmation. You talk about meeting rituals, talk to us about a meeting ritual. Are you a burning some sort of incidence and are you, or what do you do when you’re, what kind of rituals are we talking about here?
Uh, no incense. I had so many asthmatics so it works for me too. But, but meaning rituals, you know, it starts with a core values. So every single meeting we have starts with, okay, let’s go around the room and share stories around our core values. What did you see in the past week or the past month? And it just sets the tone and I, and I get it, if you have 45 people and they’re all in a room for one hour telling stories, that’s really expensive, right? What about the money you’re going to lose when you don’t share those stories? I think you have to have some campfire. It’s time to get the group together and talk.
This was a move that, uh, I’ve learned from many entrepreneurs who talked to me about the importance of doing this. And a p shy was, you know, 24 25 with the largest wedding entertainment company in the country. And I thought this was a complete waste of time so I didn’t do it, you know, and I kept having turnover and all the wrong spots and now I’ve just accepted that this is what you do and this is going to be a movie. And so we schedule it into our calendar and he think about it. If you have, in my case, you know, you have what, uh, on a Friday, uh, Andrew, there might be 50 people in that meeting, maybe on a Friday, 55 people. And if all of them are making an average of let’s say 25 bucks an hour, you know, that might cost you, you know, a $1,500 meeting, a $2,000 meeting. But it absolutely is, is vital. A. Paul, I want to get your take on this. Sure. You help companies grow from an accounting perspective, what questions would you have for piece about how to create a culture or holding people accountable? Because peace is the expert of culture development. My friend,
he’s the man piece. I just want to know. So I deal with a lot of very intelligent people, you know, do well with engineers, with mayors and clay. Clay is one of the most obviously intelligent people I know because he’s my coach. Um, but anyways, so you came from the education background, which typically you don’t see a lot of financial success from people that are in the educational background. So you’re obviously very intelligent person. How did you bridge that gap? I mean, to, what kind of advice can you give me to get people to, to really work on their business in their business? Because Joe’s, a lot of my clients struggle with that. They, they are the best at what they do, but they’re doing it so every minute they’re doing it, they’re not growing.
Well that’s true. But I can probably tell you most of those folks are inefficient. They, yes, they are in the middle of doing and it seems like they never have any time, uh, but they’re still able to go on vacations. They’re still able to take the evenings off or go to a kid’s soccer game. So a lot of that is boiling out enough time to work on the business. And for me it’s as simple as just asking everybody, tell me some stories about our core values and I can tell you very quickly, um, either they get it or they don’t.
When you were growing tutors, you became efficient, but you also had daily fires and you’re, you know, you’re putting out issues there. What, what time did you typically wake up and what did the force first four hours of your, of your work day typically look like when you were growing digital tutors?
Yeah. So, and then in the need dip as deep of it, I got up about seven, um, got to the office by nine. Yup. And you know, I’m, I’m the key firefighter, right? So I thought, so I had to put out all these fires and it really wasn’t until we started adopting the traction system or the eos system that I really started to really work myself of a job. So my mantra and the shop was at some point, this business that’s going to outgrow everybody, including me. And I will tell you I was so proud. It hurt a little, but I was really proud that after I sold the business and I exited, like permanently exited, my phone never went off. I never got an email like, how do we do this? Where’s the password for this? Um, I had to literally work myself out of a job.
Do you know Wickman’s a system? Traction is a great program. I hear a lot of people say, wow, that’s expensive, but let’s, let’s take the cost out of it for a second and let’s just talk about how it helped you with digital tutors. What kind of principles in action items did you begin to? What can action items did you begin to take as a result of the traction program that allows you to work on the business and not in it?
Right? So there’s it within the business. You have lots of processes. How do we solve this customer’s issue? How do we close a ticket? How do we release a new product? But rarely is there a system or a process on how are we going to actually run the business? Not just our product and our service and uh, it doesn’t matter if it’s traction from Gino or if it’s Verne Harnish’s scaling up or Rockefella Ha. It doesn’t matter what system it is using a system cause they’re all kind of the same. They’re all a little inbred from each other. Having a system means you’re going to have a system and you could fall back on, well, I’m not for sure how we do that. Let’s look at the system and it gave everybody a rallying call of this quarterly flow and not just a, Oh, we’re going to pick a goal and then try to hit it. It was real accountability. This is what we’re doing and where we grew leaps and bounds because we just went back to the system. A process. Okay.
Your, your, your system. Bam. Yeah. We didn’t talk about the ambulance. I went to him now the NPO belonging to be the a, the affirmation now the m the meaning. What is this meaning? How do you develop meaning in your work place where people don’t just say off Rick, all I have to do all day, everyday is code this or all I gotta do is change, you know, fixing mufflers all day. How do you keep the sarcasm and the cynicism and the pessimism out of the business? And how do you add real meaning to somebody’s job?
Well, that’s a two part question with a simple answer. First it starts with the leader. The leader is a pessimistic and uh, and value of the, I could have no value in the people that work there. Then it’s going to flow downhill as they say. Um, but the second really is as simple question that you can ask your employees if you next meeting, ah, even on one on ones, if you just ask they, what’s the most important thing you’re working on? They’re going to tell you exactly what the meaning they want out of their work. They’re going to tell you, this is what’s important to me. Uh, we developed this thing called three happies, which is, uh, to work happies and one personal happy in the last 24 hours. And we do it every morning at nine o’clock on the dot. Let me tell that little piece of a, we don’t have posted now that little piece of paper, we’ll give you all the Bam information you want on any person in your organization. It tells them what’s important to them, what’s meaningful. And by writing and sharing it, they create instant affirmation. Ah, it’s just, it’s an amazing little tool set. They can get it off my website for free. It’s, it’s really simple to implement.
Could you tell listeners out there the best domain to learn to do, to gain this information, to gather this from you?
Sure. Uh, it’s my personal website. So Patel. Okay. c.com p a t e l o k c.com. Okay. Lots and lots of material there.
Now you, you’re speaking all over the world right now. You’re speaking all over America. You’re doing speaking events where people are hiring you to come in and teach about, uh, do keynotes about how to build great a company cultures. Could you share with us a little bit about the kinds of things that you would talk about during a one hour keynote or a 90 minute keynote?
You Bet. I mean, it goes not only from the story of building this organization and the kind of the roller coaster ups and downs, but, uh, really key takeaway, practical information and things like these three happies. Uh, we teach everybody how to do a grow meeting, which stands for goals, reality options, and then the commitment is the w what will you do? And it’s a, it’s a great way to diffuse conflict and to get to the point of how do we get this thing done? And so for us, it was really about how do we take these, you know, creative tech workers and get stuff done, right? We’re so small, we’re in the middle of Oklahoma, we’re not cash rich, we’re, we’re scrappy. We just got to get stuff done. And so we, we tried to really eliminate any of the garbage of running a business and focus on how do we move the needle.
Let me ask you this, you, that’s a lot where we share. After you began to move the needle with, with digital tutors, it took off and it created some, obviously some financial freedom for you, some some time freedom for you. Uh, you, you’ve gone on to have some financial success there. Uh, can you talk to us about your love for the Oklahoma City thunder and just how close you sit into that, to that court?
I love the sender. I’m there almost every game and the funnest thing that I’ve gotten to do and my, and my whole career that sit courtside and, and I love sitting at the baseline because they’re running at you and it just feels very different than TV.
Does Russell know who you are? Dude, Russell, to talk a little bit, you and Russell.
Russ and I don’t talk, but, but I kinda, I feel like I’m giving him some play tips with my eye.
Okay. Now we’ll get a lock eyes and I’m
and he’ll know. Oh yeah. Okay. Peace wants me to no passport.
I’ve only see, I’ve only seen a Russel play very, I’ve always sat really close to the court twice a book watching Russell Westbrook play basketball. It’s kind of feels like watching an adult varsity basketball player playing dodge ball against second graders. The intensity, it’s like his intensity is like two or three times more than that of the average player. Do you agree with that or am I out of my mind? I mean that guy’s intense.
the, the speed goes from zero to a thousand. I don’t even know where it comes from, but hill, it just, there’s a fire in him that’s very different than the rest of us humans.
What is your favorite Oklahoma City thunder moment so far? Sitting court side there where you go, oh, that, that, that right there. That was worth the ticket price.
Oh my goodness. There’s been a whole bunch. I mean,
good. Clay you,
are you a good heckler or do you heckle the other team? I know they’re shooting free throws. Do you have a lot of tips you give them like boom. No. Okay.
I Ha I have lived by this adage that the most heckling comes from the cheapest seats.
I sit and I’m respectful of the other team. Uh, if, if one of our players gets traded or goes to another team on, I cheer them on and the opening, I’m, I’m proud to be them. I love watching the game. Um,
so you’re not as, and I understand not a hiker guy, you’re you, you know, piece. I’m glad to know that you’re not that streaker guy. I remember when I used to go to the Timberwolves games, there was one guy who is legendary. He would walk up and down the baseline, you know, he was a head tickets right there on the court, but he would basically just heckle people the whole game. He’d hold the program and just heckle people. Do you have any good hecklers out there where you go, this guy has got a mental disorder or are there any hecklers that are kind of infamous hecklers at, at it’s under stadium or, or is it just all good people?
The Oklahoma City Thunder. Uh, they’re all good people. I love the guy who, uh, the mega center or whatever that guy’s name is. He, yeah, he doesn’t wear a top and has a suspenders.
Big Guy, a big echo.
Everybody in the, in the stadium.
Nice. Nice. Now talk to me about the Tequila. Those, the listeners out there about your shared love of, of, uh, of the winery, the whole winery game here. Where did this love for the, uh, having a winery come from and, and uh, how have you gotten involved in the alcohol business or the, uh, uh, as a, as an entrepreneurial endeavor? No.
Well, everybody has seems to enjoy alcohol, so I don’t think that’s going to be going away anytime soon. Uh, the winery was a unique situation in that we had just sold the business and I overheard my son telling a group of friends that, um, he said, wow, what is your mom and dad do you, you’ve got all these video games and this house. And my son said, I don’t know, my mom and dad just hanging out the house all day. And you should’ve seen the look of horror on my face because I just don’t want to raise a young man to, that’s what adult life looks like. I need them to go one day, be a great dad. So I told my wife, we got to find something. This honeymoon of retirement is over. We’re too young. We’re 40 years old. We’ve got to get busy. And so I bought a winery because it was, um, it wouldn’t affect my noncompete. I, it has really no computers or anything like that and I didn’t know much about the wine business and I wanna know a lot about the wine business. Yeah. It’s a sexy agricultural manufacturing. Um, thank right. I mean it’s, um, at the end of the day a lot of hospitality, which I enjoy, but uh, that, that endeavor has led me to be, uh, one of the key investors and the angry Scotsman brewery here in Oklahoma City.
Yeah. Just Super Fun. Brewery here in town.
Yeah. I’m going to Google search that real quick. I’ll put them in the show notes there. The angry Scotsman. Did you come up with that name or who did come up with that name?
No, he’s a Scottish guy, and I’ll be honest with you, clay, I hated the name, really, absolutely hated the name. And he was like, really? And I was like, look, I don’t, I don’t want to get involved because who, who, which, which group of young females want to go to a bar or a pub or a a brewery called the angry Scotsman. That just sounds scary. He’s like, really? Cause I think people like it. I said, well, let’s do this. Let’s just let the numbers decide. And so I hired a virtual assistant to go pull 100 college aged females and it was overwhelming. They loved the name angry Scotsman. So I was like, hey, you’re here. We’re on to something.
I’m in. So now how did you decide, how do you decide the listeners out there? Because, uh, our, uh, you know, there’s a lot of listeners out there that are looking for investors and I know that you do some investing. How do you decide what kind of businesses you’re going to be? An Angel investor in and what kind of businesses where you go, that’s a great idea, but I’m not going to get involved.
Well, they have to be on, that’d be past the idea stage. So there’s, there’s enough, um, gambling money out there that people can raise money with an idea. I, I look at execution. So can you execute, uh, the money that I give you, can you be respectful of it? Can you grow? It may really follows my own core values. Um, and I’m betting on the person, I’m not really betting on the company or even the idea or the product. I’m really betting on that entrepreneur who can go solve that. So this young man at the brewery, he’s got a phd in chemistry. Uh, he knows how to brew beer because he had a can of beer. If you put it in the fridge and you go buy a new one six months later, those cans have to taste the same. Red Takes a lot of chemistry knowledge to do that. And so for me, I’m betting at him.
So if there’s a listener out there who’s trying to get in touch with your organization about a funding, is there a certain way, is there a certain website they they go to and they submit their business too or do you reach out to people? How does that process work or you know, for someone to get in touch with you about um, and raising investment capital.
Yeah, so I don’t do much retail. I really stick with the reoccurring online. I’ve kind of gone back to what am I good at and it, and I know how to sell online and I know how to do marketing online. So I’m finding myself going back to that model. But they, we have a form on the website that they can reach out to and form and we could set up a time to meet. I say no more than I say yes. I just how I am. But I’ll tell people know up front, so I’m not going to lead anybody on. For your listeners. If they’re done pitch meetings and they hear things like, wow, that’s really interesting, I’m going to have to take it back to my partners. That’s a no. Or if they hear, oh, I’m going to have to do more due diligence, that’s a no, because more than likely you’re, you’re like a yes. The minute that you hear where they’re at and would they want to do,
doctorZ is often said it’s either a hell yes or a no. You said you said it right. Everything is either a no or a hell. He asked. There’s nothing in in the, in the middle. Do you do agree with that idea?
Okay, so the listeners out there, if you have a business that exists that is making money, it’s not just an idea and you go to Patel. Okay. c.com there you can learn more about your speaking, learn more about the investing, learn more about your book and in in your book you talk about how people don’t quit jobs, they quit people. So I want to ask you this question and then I want to, I know Paul Hood has a hot question for you. So again, somebody out there is listening, they’re taking notes and they go, okay, people don’t quit jobs. They quit people. What do you mean by that?
Well, take of all the nasty, terrible jobs that are out there and people do them and it’s not typically for a whole bunch of money. I mean, people do the work that they feel adds value that and that creates Bam. But when you put a manager or a leader in place that does not create Bam for that person, now they’re looking at that job as purely a transactional. And it’s essentially, I don’t make enough money to do this job, but really I don’t make enough money to deal with your garbage because it’s more than just the job. And I really think if you’re not investing in your people’s emotional wellbeing and yup, creating Bam for them, true, you’re missing out. You’re, you’re totally missing out on the opportunity.
Paul, who has a hot question for Nepal, has been known to paint our guests into the corner as his sort of as the student’s favorite pastime as one of our show sponsors to call. What’s your question for piece of Patel?
Kesha? I don’t know what he’s talking about. I am a very sweet man. I don’t have it. Very sweet. Very sweet. Yeah. So you mentioned cult marketing. So do you, we do a little bit as you know, referral based marketing. I’m a financial advisor as well. And did, did you, when you were in the middle of growing this, did you just use the wow factor to motivate people to, to, to refer to you or did you a for instance, we do at our offices of once we set up a, a planning session with people and they love us, um, which they generally do. Thankfully. Um, we, you know, we say we’ll give you $25 gift card.
I have one, I have one caveat a piece before you tackle this question. Just one caveat for the listeners out there that don’t know [inaudible] Patel. Patel is a man that if he says he’s going to do something, Peach Patel does, boom piece you, you, you, you always own it. If you said, if digital tutors is going to do this, then if you say I’m going to do it, you, you did it. So I just wanna make sure the listeners out there get this, because as a business coach, I’ve discovered that a lot of people drop the ball all the time, right? So I would say just yes, from my experience, I know that Peach Patel’s team was wowing people. Back to you Paul. I just wanna make sure, cause I know that he was wowing people. Yeah. And so we do too. But I just wanted to know, you know, we offer a little token $25 gift card or something for, for, for referrals and, and with the knowledge that, that, that’s just the little tip that gets them over the, over the hump because we are going to over deliver. So did you ever have any kind of carrot, if you will, to get referrals or was that just straight up? The carrot was how you guys delivered?
No carrots. So I’d never wanted customers to feel like I’m a friend of theirs, recommended them. They signed up and then when they signed up one of their friends out of just altruistically, they got a card in the mail that had $25 gift card in it. It’s like, whoa. So did the other guys sign me up and recommended or was a genuine about it? And we went through, this was a 14 year process to really nail down what worked for us. And at the end of the day it boils down to building a product that people really wanted and we get lost sometimes in jockeying for what would be better. So, uh, we, we removed no discounts, no salespeople. We removed everything that wasn’t making the product better. And then our focus was on, we don’t want product customers to churn. So we became obsessive about maintaining and growing the customer base, but by not by losing half and gaining a third and losing another half, getting third. Right. So churn in the online world is just this destructive and for us turn meant we’re not doing the right thing by our customers.
Focused on. Wow.
You said it was 14, 14 years. You grew digital tutors.
14 years. If you’re out there listening today, you want to get rich quick step one, work at something for 14 years, then you can get rich real fast or the wire came in real fast. Right? It was a quick wire.
That’s right. It was a, it was a 14 year overnight success.
There is now a, also in your book you talk about hiring, you talk about, uh, making sure that you’re, you, you’ve talked about this concept called the second wake up call. Let’s dive into hiring here. What kinds of things do you teach readers in your book about hiring?
Well, if you hire somebody and you put them in a desk and you tell him, ready, set, go do this thing called work. Yeah. You guys are all setting yourselves for failure. That the cost of replacing employees, uh, is upwards of 150% of their salary. So, um, I’ve heard of that number even higher depending on the type of work they do. So for us, it actually starts even before your first day. So two weeks before you start with us, you get a box in the mail, all of your paperwork, fill all your w two stuff or w four or whatever that stuff is to fill it all at home. Um, fill all your, read all of our handbook, do all that at home. Uh, but in the box also includes some clothes, some shirts to wear on your first day. Um, a little book about your team, but I’ll tell you a claim, Paul, the most important thing in that box was an empty picture frame with a note that said, bring a picture of your loved one.
So your desk has, you know, starts to feel like home. People say that two of the most stressful days of any person’s career is the first day they take the job in the day they are. Let go. And um, I didn’t want their first day to be stressful. And so when they think like, oh my gosh, what have I jumped into? And they see their loved one on their desk. Yeah, I get this. So for us it starts before you even take the job. Then on your day one, you’re going to spend half a day with me and some of your listeners are going to say, well, I’m too busy for half a day. Okay, we’ll just take how much of that salary you’re going to pay. And throw some of that away
with what you’re saying. But I know that there’s probably 95% of our listeners, I know our listeners piece, I know these folks. These are great people and there’s the civil, we’re going, really, you’re going to have someone shadow you like you, the owner, the guy. I mean, you’re the dude you, you really, really, really, you know, we have these entrepreneurs out there, you know, and they’re kind of, they’re inquisitive people. For somebody out there who wants to ask the question. Really? You have them shadow with the boss again? Did you really do that patient
horses mouth? I need every employee to hear it from me. This is why we started the company. This is how you play your part. A lot of people we’d teach them the game of business. You’d be surprised how many people don’t know the simple game of business. Right? Right. And when I asked things like we’re paying 100% of your health insurance, why would I do that? Because you’re nice. Well I like to be. Why else? Um, because you have to. Nope, don’t have to. And then when you explain, oh, it’s because I don’t need you sick and if you’re sick, I don’t want making everybody else sick cause we’re running a business and they look at you like, oh that’s why you do that. And so we, we, we were open book, we taught them how to read our financial statements, we taught them how the business, how the money flows and how the teams work. And then the other half of the day they would spend with their team learning about how the process works. And really I’m not asking for any actual work for a couple of weeks because it’s going to take you a couple of weeks to truly understand how we play before we throw you into game.
Nope. Peach in your book you wrote work is war and good leaders are in the trenches now. Yup. I want to provide some balanced perspective to this bounce perspective to this. Um, you and uh, I enjoyed, uh, teaching people how to make video games and, and uh, how to do, you know, all these different kinds of creative skills. What you turned into your business with my company Dj Connection, I loved Dj and I was into Dj and so I would bring people with me to shadow and to DJ where they have to have a shadow. They’ve learned the DJ skills from me. And here I had the largest wedding entertainment company on the planet and I’m still deejaying because I loved it. Um, where’s the balance between, you know, still deejaying, working in the, in the trenches are still coding, are still cold calling. You’re still doing whatever you have to do and delegating, you know, forgot like Paul still being a CPA versus delegating. Where’s, talk to me about getting in the trenches and that balance in this quote work is war in good leaders are in the trenches.
Well, every one of my managers was a working manager. So the person who ran the curriculum had to create a course where everybody else may have created 1213 a month. They have to create one. If you were in charge of the customer success, well you also had to take on a couple of accounts and not just manage your team. So every single manager in the organization was a working manager. They knew what they were asking of their people and I felt the same way. And I will tell you over time, over those 14 years I went from, you know, chief janitor and doing everything to, you know, towards the very end, I just really needed to have a once a month meeting with everybody. And then, uh, once a week, one-hour meeting with my team. And that was how far I had gotten away from working in the business. Um, and I think it’s that transitionary process, but it really starts with the people you start to promote inside your company to make sure that they are all working managers. I think people respect those kinds of folks more cause they go, oh, you’re not just telling me what to do. You’re actually helping me do it.
Nope. I have two final questions for you. I know Paul has one final question for you as well here. So I want to ask you about dysfunctional habits. You see a lot of business owners and now you’re doing some consulting. Um, you’re leading an organization. We are helping entrepreneurs get some traction. And you, I’m sure you’ve seen the common denominators that cause dysfunctional, uh, businesses. Can you talk to us about the common denominators that you see amongst chronically dysfunctional businesses and business owners?
Absolutely. So some of them are, they’re thinking small. Um, they’re not really solving a customer problem. I think the big buzzword for 2019 that you’re gonna hear from a lot of investors is product-market fit. So that’s, you know, they’re not solving the customer’s problem and they’re not focused on getting paid. So there’s this idea of, well I just need to raise some money and I’ve, I’m successful and I think in the music that would be like, I got a record contract so I’m successful. Yeah. Uh, so I don’t need to make any songs or go into a studio and record or even go on tour because I got paid from my contract. Um, and I think that that’s a mistake, right? We’ve got to solve a problem and people don’t understand when they take on an investor, they’ve just taken on a massive customer, right? Cause that investor has an expectation and communication. And, um, most people don’t need an investor. They just need to get to work, solving a customer problem, let the customer find their business. Like mine.
I tell listeners at this all the time, but I want to use this as a, as an opportunity to share it. Again, when you take on an investor, you’re going to take on what I call the three C’s are going to take on the council. You know, the advice of the investor, whether you want their advice or not. If someone’s giving you 1 million bucks, they’re going to give you advice. You’re going to get their connections whether you want it or not. If they’re affiliated with good people or bad people, they have a good reputation or a bad reputation. You take that on. And then the third C is yeah, you do get the cash, but those are the three C’s that you get with an investor. Uh, Paul, you got a tough question. [inaudible] piece Patel, your final question of the day. My friend
question is peace. You know, a lot of times people see people are successful and like clay says, it was an overnight success. It took 14 years overnight. How did you deal? There had to be adversity in, in Vr. How did you, how did you deal with that? Who did you turn to? What was your, your go to move to move, get back up and, and push forward?
Well for me, the God said was joining the entrepreneurs’ organization. So yeah, there’s a chapter in Tulsa and one Oklahoma City and there’s 14,000 members all over the world. And you know, like I said, I was, my background is a sixth grade science teacher, so that’s what I’m good at. That’s what I’m trained at to run a business. And this was, every day was new. And like I said, I was just too dumb to know. I just kept showing up. Um, good or bad plan, no plan. I just kept showing up. It wasn’t until I got involved with the entrepreneurs’ organization that I got to be around peers who, some were in my situation somewhere a few years behind me, but many were ahead. And so I got to see what exiting a business look like and how to structure that deal before mine came along at an intimate level. Otherwise, I would have just been lost. Um, how to grow the business, how to, you know, transfer. We went from physical cds in the mail to 100% online. I mean, can you imagine? We had, we were at about $3 million in revenue. One day we had $3 million worth of customers and the next morning we fired all of them and said, okay, now you have to buy it completely online. Um, but in that year we went to five. So I mean it was, it was well worth making these transitions.
Now to the listeners out there, I have purchased a, a copy of your book, Lead Your tribe, Love Your Work and entrepreneur’s guide to creating a culture that matters. Uh, and uh, it was definitely worth the read. Definitely worth the money. Definitely worth the investment. For the listeners out to her saying, you know, uh, you’re, you’re a well read guy. I mean, do you have another book you’d recommend to, do you have what you have? You have one more book or a couple of books that you’d recommend for all the listeners out there,
Simon Sinek leaders eat last and huge fan of Simon Sinek. I love, I love the message in the book and it resonates with my style of leadership. And for all of your Oklahoma listeners or those of your listeners who have an Oklahoma Tai, I am in love with Sam Anderson’s book boom town, which is Oklahoma history mixed with Oklahoma City thunder history and stories of how it all happened and uh, I’m, I’m listening to the audio book because I’ve heard it was better than the print and I’m just in love with it and they got bought 20 copies already.
And you, you actually recommended to me the book innovator’s dilemma by Clayton Christensen, which then led to me interviewing Clayton Christiansen here just to about a month ago. And hopefully you heard the [inaudible] piece Patel shout out in that podcast because
great interview too.
He’s a, he’s just a a living legend up peach. I thank you so much for taking time out of your schedule. I know you could be doing anything right now. You could be courtside for preparing yourself mentally and spiritually for the next game. You could be chasing your wife around, you can be at your winery, you could be meeting with someone about investing and their business. You could be doing a keynote speech out there, but thank you so much for investing in our listeners.
Oh my pleasure. I really appreciate what you’re doing and all, all these years I’ve known you, I’ve always wished and nothing but the best of success.
Hey, well thank you and have a great day, my friend.
Now it’s time to take some action. On a scale of one to 10 with 10 being the highest, how highly would you rate your culture? I would encourage you, write down that number today. Again, on a scale of one to 10 with 10 being the highest and one being the lowest, how highly would you rate the culture in your business? How could you improve the onboarding of the employees within your business? What would be a better way for you to show your employees the path to their career success within your company, and how can you truly mentor each person more effectively? And we’d like to end each and every show with a boom. So now without any further ado, here we go. Three, two, one, boom.