Dave Carvajal, Author, Entrepreneur, CEO, Dave Partners
Dave Carvajal is a builder of billion dollar businesses. As CEO of Dave Partners, Dave is a sought out advisor and consultant to Board of Directors, venture firms, CEO entrepreneurs and leadership teams of some of the most exciting growth companies in the technology space that are making the world better.
https://davecarvajal.com/
https://davepartners.com/
https://davecarvajal.com/hire-smart-from-the-start/
AUTOMATED EPISODE TRANSCRIPT
[00:00:01] You're listening to Scaling Up Services where we speak with entrepreneurs authors business experts and thought leaders to give you the knowledge and insights you need to scale your service based business faster and easier. And now here is your host Business Coach Bruce Eckfeldt.
[00:00:22] Are you a CEO looking to scale your company faster and easier. Checkout Thrive Roundtable thrive combines a moderated peer group mastermind expert one on one coaching access to proven growth tools and a 24/7 support community created by Inc award winning CEO and certified scaling up business coach Bruce Eckfeldt. Thrive will help you grow your business more quickly and with less drama. For more details about the program, visit eckfeldt.com/thrive . That’s E C K F E L D T. com / thrive
[00:00:01] You're listening to Scaling Up Services where we speak with entrepreneurs, authors, business experts and thought leaders to give you the knowledge and insights you need to scale your service based business faster and easier. And now here is your host, Bruce Eckfeldt
[00:00:57] Welcome, everyone. This is scaling up services. I'm pre-sexual. I'm your host. And our guest today is David Carvajal. He is CEO of Dave's Partners. We're gonna talk about recruiting. We're going to highlight talent, key conversation for companies in the service based businesses. Finding talent is critical to being able to grow and scale your company if you can find the right people. You might as well hang it up. It's just not possible if you're if you don't have a good system, a good strategy, good process for finding the right talent, attracting them, recruiting them, onboarding them. So critical conversation. I'm excited to have this with that. Dave, welcome to the program. Thanks, Bruce. Thanks for having me. So why don't we start with a little bit of your background. So you've been in talent for a long time and in many businesses and many facets. Tell us about the journey. How how did you get to what you're doing today? What were some of the experiences you had around really kind of making talent work?
[00:01:48] Yeah, yeah, that's great. You know, I've been thinking about recruiting for more than 20 years now. And, you know, I've met a lot of people in recruiting. I haven't met anyone as crazy about recruiting as I am. And I mean, I just love this stuff. I love connecting people. I love helping entrepreneurs just build a really big businesses. And, you know, look, it's my firm belief that everything bad that happens at a company is fundamentally a people problem. And conversely, I also think that recruiting is actually the greatest opportunity that an entrepreneur has, not only in building their business, but in really kind of achieving their mission in life, Fred. And so, you know, my journey, it's a bit of a funny one. I started my life, you know, went down to college at Clemson University, came back to New York City. And I just wanted to tear it up immediately. I took a job in the investment banking analyst program at Prudential. I was on track to become a big banker. And I realized that, you know, while while they were making a ton of money, which frankly at the time was very attractive to me, I discovered that the world of corporate finance and investment banking. I mean, I'm sure there's some wonderful people in that business. But the people that I was surrounded with were either absolutely miserable or they wouldn't be bad. Sometimes they were actually. And, you know, I decided early my career.
[00:03:06] I didn't want to be either one of those things. And so I ended up leaving and I wasn't sure what I was going to do with my life. I ended up at the top recruiting firm in New York City, and I never knew that the whole business of recruiting and headhunting had existed. And so when I got there, I said, wow, this is fantastic. You're gonna find me a great job. I ended up somehow speaking with the guy who started the company the recruiting from. He had 60 executive search professionals from the top schools with vastly more experience than I had back then. And, you know, he convinced me that if I would work hard, I could be really successful. And, you know, I remember saying to the guy, look, that sounds like a bunch of baloney. You know, my dad would get up at 4:00 in the morning to come be a printer. And, you know, for as long as I can remember, the glory of hard work was instilled in us as children. If what you're saying is true, I said to the guy, you know, could I be your top two? People like to figure out what they're doing to be successful and just tell you whether I think I can do it or not. You know, and so it turns out, you know, the way people were looking for jobs back then was through these things called newspapers.
[00:04:01] This is the new black and they're black and white.
[00:04:03] And yeah, I mean, you literally had to get your hands dirty, you know? And and that people comes at it's 6:00 a.m. on Sundays. And so literally, it was a gut check as to whether I was willing to work that hard six days a week starting at 6:00 a.m. on Sundays. I was 24 years old at the time. It turns out I wasn't willing to work that hard. And so I said to the guy, if you hire me, I'm going to be the best guy in this office in two years. I just knew that I could outwork anybody.
[00:04:27] A public declaration of where you're gonna be in two years. I love it.
[00:04:30] You know, I made the commitment and, you know, he hired me on the spot. I put my plan a work. I worked my tail off Bruce by by 9:00 o'clock on Mondays when everybody else was coming into the office for the first time after being in the in the Hamptons all weekend. I had already made 200 phone calls and lugged my entire territory into the system. And so it literally took me 18 months to become the top guy in the office. And tastic. I was young, single Libyan man had making the kind of money I want to make finally. I never would have left if not for something much greater, much bigger. Of course, the problem was it was the mid-nineties. By then I was talking to technology guys all day long. And back then, you know, New York City Tech really meant one thing. And that was financier of this jobs bill, the guy out of Merrill Lynch who would develop that fixed income trading desk using C++, Unix and Sybase. And it was only because a week earlier the folks at the J. Orange Group at Goldman Sachs needed a VPN. Fixed income trading technology should kind of horse trading all day, every day. It hit me that this Internet thing was just going to change everything. And it had to be a part of it. The same guy who started that recruiting firm and had asked me to join the recruiting company, he was the same guy that asked me to leave the company. And I was fortunate that he did because he was leaving. And he handpicked me to come along with him to start this tiny little Internet company.
[00:05:40] And the truth is, we didn't know what the heck we were doing. There were only 150 companies doing online recruitment. All we knew what we thought was that because we were headhunters, we thought we could build a system for recruiting better than anybody else. And so we're doing it. I ended up running sales. I created a training program where I could take a kid right out of college and make them profitable to the company within two and a half months. Now, I showed this to the CEO and I made a pact that I would hire two salespeople for every one non-revenue producer. And then I proceeded to hire the first 500 people at hijabs, open eight offices around the country, yet 500 percent revenue growth every single year in four years. We took it from 400000 to ninety six million in revenues. We had 60 percent. But our margins. Now it's a beautiful business. I took the company public who was a $1.2 billion market cap. And then 9/11 happened and the whole world changed. We were a jobs company and we were affected, you know, drastically. But what happened was we had so much momentum that we actually continued to grow when every thing else kind of got stagnant and stuck. We managed to continue to grow. And then the number one Internet media company on the entire planet at that time was Yahoo! And February of 2002, we closed the deal. We decided to sell and sell five years soup to nuts. We were done with a double exit. And it was fantastic. I was all of 31 years old at that time.
[00:07:00] And the truth is, I didn't know what the heck was lost at sea.
[00:07:06] You know, fortunately, I had fallen in love. And so we managed to fall deeper in love, get married, have babies. Good. And I woke up three years later and I was literally 60 pounds heavier than I am now or just really bad. You know, sympathy, pregnancy, you know, the whole thing. I mean, I was in really bad shape. I went to the doctor. He said, look, you've got to make some changes. And he put a bunch of drugs, you know, prescriptions. And so I just said, look, there's got to be a plan B. What is outlook like? He said, well, you'd have to loosen. We'd get in shape, maybe some green things. I said, let's make their plan. I can do that. So I decided to get healthy fast. I discovered triathlons and now I do romance for fun. And the second thing I did is I called up some guys that I had hired at the first company at HotJobs. And I said, look, guys, it's time to get back to work. I'm never taking time off like this again. I need to be productive. I need to work to create until that's it. Let's go do something and we start another company. That company was called Ladder's. We got it up to about 400 people, a little over eighty five million in revenues. And by 2008, there we were again. I was the hottest game in town. By 2009, I decided, you know, that credit crisis thing happened. I decided I didn't want to do this anymore. For one company. I wanted to help as many as I could. And over the course of that time, from building those two companies, I had really picked up some strong pattern recognition in watching people who were very successful in their careers and also people who didn't quite make it.
[00:08:30] You know, it works as well with the business scale with the company. And in fact, we're holding things back or, you know, teams of people or themselves. And so, you know, I started getting calls in 2009 by some of the top venture capital investors from around the country who were looking at New York City as a place to make increasingly more investments in Internet startups. They kept calling me, you know, really for handouts, for free advice on who I could refer to them to run revenue. Chief technology officer or GIBI, their chief product officer, or they knew the co-founder. And so I did that for a little while and did a bunch of horse trading. Then I woke up one day. I said, well, you know, I can actually make money doing this. I decided to hang up my own shingle, Dave Partners. And so that's what I've been do for 10 years. And now I'm having more fun than ever before to good ends. And, you know, really, really kind of selective about the way we're a boutique firm, services business and, you know, have have gone through the ups and downs of our own kind of service model. But finally, it was able to figure out the kind of optimal size and cash flow and kind of business that I wanted to. ROHMAN still be able to do Iron Man and spend time with my family.
[00:09:40] Yeah, it's interesting. I mean, you know, obviously super impressive. You know, kudos for the access and and building the companies. I think the really interesting thing about your story is that kind of break, period. And I see this again and again. You've got a hugely successful entrepreneurs that create a hugely valuable company. They get an exit and then they're then they really don't know what to do themselves. I mean, they kind of had this vision of I'm going to sit on the beach, I'm going to I'm going to kick back and. And that's like the last thing ends up being a good choice for them. And, you know, that's it. Best scenarios. They get bored. They finally do something else. Worse scenarios they could secreting all sorts of other problems in their lives because they need to solve problems.
[00:10:15] They're just they're they're hungry to be problem solvers. And if they're not finding a way to apply. In a positive, fruitful venture, you can really end up kind of creating critics of nightmare situations, but I'm really fascinated because I mean, obviously you've had some success over giving you success and you've been able to kind of use this to dial in a really focused niche area that which is, I think probably a combination of what you really love to do, what you're really good at and particularly need in the market that probably only you can solve at some level just because of your background and connections and access to certain kinds of talents. A great example of of leveraging those things to create a really, really unique service business.
[00:10:54] So let's talk about talent and what you've seen or heard. One of the comments you made I thought was really interesting. Is this a slight difference between those who have been highly successful and those that didn't quite make it? What are some of the things that you noticed in terms of what were good indicators or things that would predict or give you a clue of someone that would successfully grow with the business versus someone who wouldn't and end up becoming kind of a bottleneck to the organizational growth?
[00:11:22] Yeah, that's great. That's great. So two things before well, before I get into that. You know, you triggered something from a brush that I think is worth sharing, you know, about the kind of entrepreneur's journey. I think you're absolutely right. And I've known a number of people that reached just extraordinary levels of success. And, you know, when you get to the promised land, you can sometimes be lost because you've been fighting so hard for your mission to achieve your mission, that once you actually achieve it, you know, and in that kind of period when when I was wandering the desert, you know, I had the good fortune of really doing a little bit of work with. I'm sure you've heard of them. Tony Robbins. Yeah. And so I did some coaching with him at the highest levels. I mean, literally, we went to India twice, you know, and and were hanging out like this. And, you know, he said something to me, Bruce, that I think is worth sharing, because at the time and when I repeated, it's going to sound a bit trait. But at the time, he was exactly what I needed to hear. And it really kind of helped get me back on track and aligned with my core kind of like values and what I think I was meant to do in the world. Right. And what he said to me, he said, look, Dave, when Buzz Aldrin came back from the moon, he literally became an alcoholic. And it was because he couldn't get out of bed because what was he going to do today that was as exciting as what he had already achieved? I mean, he's one of two people that have every step, you know, foot on on the moon.
[00:12:43] Right. And so what? Twenty seven. Yeah. Yeah, yeah. So 20 said to me is that look the secret to when you know, once you get to the promised land, what you've got to do is find a purpose that's bigger than yourself. You've got to find a bigger purpose. You've got to figure out how to serve others. And it was absolutely profound and it just kind of knocked me on the floor. And it really connected me with, you know, actually, well, I wasn't gonna talk about it. But, you know, the reason I do this, Bruce, on the one hand, I'm helping entrepreneurs build billion dollar businesses. Right. I'm in the world of venture backed companies that are really kind of you know, usually I get brought in by the chairman of the board, somebody who writes a big check, 20, 40, 50 million dollars into a hot high growth company. And now it's all about accelerated growth rate. And that has to be intelligent, strategic. Right. But but make no mistake about it, the venture capital investors are literally renting money and they want their money back in four or five years and they want to make a large return, ideally a 10x return on their money. Right. And the only way to do that is called team building. And team building is two things. It's hardcore recruiting and culture. And, you know, show, show. I kind of get brought into situations that are a bit of a pressure cooker raid and there is no room for mistakes.
[00:14:00] And so, you know, going into the second thing to the thing you asked me earlier and the difference that I see between people who are successful on their entrepreneurial journey and the people that are not, the big difference is that EGF people who learn how to function by not using EGF end up being the most successful and EGF get you into a whole world of trouble. And when like I stopped using EGF for myself and when I can coach and influence other entrepreneurs to stop using EGF, the amount of success that they begin to see, it just get consistent steady and they start really having accelerated growth. And by EGF I mean entrepreneur gut feeling. Interesting. And so it is such an elusive you know, it's such a law for entrepreneurs. You know, they think everybody thinks they have to use their gut.
[00:14:53] They think they have like a special kind of spider sense and they have to use their gut. And it's more true in recruiting than in anything else. Right. Because, I mean, people are better off doing their own taxes, doing their own dentistry, doing their own shoes. But that would cause them the most skull crushing pain, suffering and brain damage is making a bed higher. It is so true and so. I say that, you know, look, recruiting is both the biggest opportunity in entrepreneurship and it's also the greatest cause for failure. And when these women entrepreneurs are able to move away from their EGF model and move towards something that is significantly more scientific and KPI and data driven, that's when they're going to begin to have significantly more success.
[00:15:45] I mean, I've seen this all the time and it's kind of you know, they do a couple interviews. They talk with them on the phone while they're bringing them in. And they make these hiring decisions based on not only purely subjective and qualitative kind of data, but the data that's pulled from experiences had nothing to do with the actual words I got. Put them in a room and I talk to them. Well, what is the job? Well, they've got to go out and sell or they've got to write code. OK. Well, you know, so how are you going to evaluate them being able to talk and, you know, in a room with their ability to write code? Like I can figure that out based on the conversation. I was like, oh, well, you know, that I think the whole kind of interviewing process is just rife with with false, you know, false data or poor data and data collected on things that have very, very little to do with actual job performance. Yeah. Yeah. I think that's true. And I'm fascinated about, you know, that. I mean, you're clearly operating an area where the cost of failure is huge and so it creates this pressure cooker situation. I guess what are some of the things that you're kind of evaluating when you're going into a situation? You're going working with a company who needs to bring in a new senior level person on a leadership team. I guess what are the things you're looking at in terms of the team and how they're set up and and what they might need based on the nature of the team and the business model? I guess what what are the things the things you're looking for to understand who would be a good fit or who is going to be highly successful in this particular situation above and beyond just the skill based staff in terms of how do they know that they know this particular technology or that they have experience in this kind of industry? What are the things that you look for in terms of the team?
[00:17:21] Yeah, that's great. So two things. One. You know, look, there's a set of criteria that I look for in entrepreneurs that I will actually want to work with. And then once I decide that, you know, I'm highly selective about the client, you know, I run a boutique firm. My buddies are the guys from that original search firm that run a lot of the big practices and the big executive retains search firms. And, you know, they've all tried to get me to come run some big part of their organization. And what I say to them. And the problem that I have with them is that, look, you guys are all trying to be the biggest zero interest in being the biggest. I just want to be the best. And so with the problem they're trying to be the biggest gets them into is that they do end up taking on all the searches they can and then their searches will drag on for 10, 11, 12 months, whereas I'm averaging sixty eight days to close. And I've got a very disciplined, systematic process that I'm averaging 60 days to because because I go into it with a two month timeframe, you know, foreclosure for for getting this process done. And it's the same amount of work. You know, there's there's actually a derivative of the perennial principle that says work will expand to fit the time, Alexander.
[00:18:22] So if you're a timeframe that, you know, is ten, eleven, twelve months, it'll take you that long to get it done. But what I do is very different. So I want a very, very strong process that begins with number one. And what I look for both in the entrepreneur is that I work with. And then to be able to kind of help create a very cohesive, strong team that is able to drive accelerated growth is first and foremost, my entrepreneur has to have a growth mindset reaching. There are really two qualities. One is they're highly ambitious, which, you know, that quality exists in spades, but they really have to have a growth mindset. Right. And they've got to be because I believe that all learning and growth requires an openness to learning and growth. And so they've got to have some level of humility, some level of openness. They have to kind of know that there are some things that maybe they don't know. Right. Because then I can actually have some influence and, you know, take them through a process in a model that will forever change the way they think about recruiting and building culture in their company. And show the way that I do that. The very first thing that I do is we actually sit down when we kick off a search.
[00:19:23] We'll spend 45 minutes to an hour and we'll create precise clarity on one piece of paper, a one pager called a blueprint. Right. I actually walk through it in great detail. I just kind of highlight it. But in my book, Hiring Smart from the start on page 97, I walk through exactly how to do this. You know, I'll give you kind of like the highlights. So on this one page, the pages in three parts. A type of middle and a bottom section. The top part is all about the company. And so it's about the core values, the culture and the mission of the company. And while, you know, I'm just going to kind of reach the highlights, I sometimes also spend, you know, like a whole morning, like four hours with an executive team just to make sure that there is proper alignment and that we create that the right way. And you only have to do that like once every two years or once every 18 months. But it's so important to get that right. And I just kind of envision Boyd point on how I actually do that. I think it's so important to look out 10. From now, for example, Rachel, I'll take a CEO and I'll usually kind of go through the mental exercise first with the CEO and then we'll do it as an executive team at an offsite.
[00:20:29] But will will reverse engineer from 10 years will go back to three years and then one year. Right. And it's only by doing that can you get real clarity. Right. Because if the CEO thinks that in 10 years we're going to be a $3 billion company and have 60 percent margins. And if the CFO thinks is on a completely different page and thinks they're going to be a 10 billion dollar company, you know, that's an enormous gap. And we need to kind of have a real big conversation as an executive team to make sure everybody's on, sees the vision and understands what we're trying to do here. OK. Me the top part is all about the core values of the culture in the mission of the organization. The middle part. And this is probably the most important part for me in executing an executive search. And I like to go. I like to begin with the end in mind. Right. So I want to get clarity around the outcomes first and then reverse engineer. So that middle part has three parts as well, going from the right side to the left side. So I start on the right side because I want to begin with the end in mind. And what we do there is list out the top three or four strategic priorities.
[00:21:28] The role of this is now the role that you're trying to fill.
[00:21:32] That's right. So so the one pager looks like it has a tough part, a middle part and a bottom part, you know, equal thirds. And then the middle part also has three parts, but not horizontal, rather vertical reach. So it's sort of three columns and three columns. So it's got a left side, a middle side and a right side. And I start on the right side. And on the right side, we get absolute clarity on what are the top three or four strategic priorities. I think that every executive level conversation should begin and end with this in mind. So why are we getting out of bed? What are we trying to do here? And usually it looks like, you know, the first bullet is maybe a top line revenue goal. It might be the second bullet might be a margin. Third bullet might be some kind of, you know, truth about the marketplace. We're going to be the number one player in this market or we're going to create an entirely new category between these two markets. You know, you might look at something like that, Rachel, going to get absolute clarity on what are the strategic priorities that we're looking to do here as an executive team. Then we get to the second part, which is what are the success factors? What does this executive need to do? What do they get to do over the next six to 12, 24 months? That will help drive those strategic priorities. How will we know twelve months from now that this executive that we just hired was successful? Right. What is success look like for them? So now that we've gotten the strategic priorities, the success factors, then we get the third column on left, which is probably the most important for me, which is what are then the core competencies necessary for this executive to be successful in the role.
[00:23:01] And what are some level what are some of the typical example competencies that you would be putting into that box?
[00:23:07] Great. So typically, for example, I might have an engineering team that, you know, has three engineers and we need to scale to 15 engineers in the next 12 months. So the competency that this CTO that we're going to hire or a V.P. of engineering, the new one that is to come in, he needs to have the company of one, maybe selecting a players also might need to have the competency of team building, actually building a culture within it, you know, like for a World-Class tech organization. Right. Might depending on the get the composure of the rest of the team, of the person who's running the product organization or the marketing or his organization, maybe this deal also needs to be a little bit visionary, or maybe they actually need to be less visionary, but more detail oriented. Exactly right. And so I'm a big believer in the reason, you know, I'm big on growth mindset. Bruce is because, you know, the other quality that a CEO needs to have is they need to recognize that no leader is perfect, including themselves.
[00:24:09] Lots of incomplete leader, complete team is very right. It's about building a team that compliment each other complementary capabilities. That's how you achieve your mission as a team. That's how you win. Right. And so my one pager in three parts, the top part is about the company. The middle part is about the role. And the bottom part is split in two columns. And on the left column, we're going to put the must haves and the right column, we're gonna put the nice to haves. And it's only going to be three must haves and it's going to be three or four nights to happen. Because if everything is important that nothing is important, we have to do a focus prioritization. Exactly. And that's how you not only get somebody who's going to be super effective in the role, but they're also going to help us achieve our mission. And that's important.
[00:24:57] And what what I find as a super powerful. And the way that you set this up is two big things. I mean, one is your keenness off of where do we want to be like? Whereas the company going because we can go lots of different places and depending on where we go, we're going to need a different team. We're going to need different skills. So unless we really articulate where do we want to be in the next three, five, 10 years, you know, we're going to. It's going to be tough to decide if this glassing to be a great person. They just may not be the person that's going to get us there. So understanding where we want to be is really key. And I love that focus. The other thing that I think you're doing here, which I think is so many people don't do when they got to hiring, is is really prioritizing. The top must need skills and the capabilities skills are things that are really going to drive success in this job because it's so easy to interview somebody and they're like, oh, but this is great and this is great. And this is great. You'll find all sorts of great things about them. But if you haven't figured out what are the key things for you and really the few key critical things, it's going to be impossible to really evaluate that person based on.
[00:25:59] Is this really the right match or not? And and if you have a list of 15 things you want and a person is like, all right, well, you can have everything you want, but you can have anything you want, but not everything you want to choose. Like, what are those things that you're going to get? And if you run into too risky, I think you run the risk of letting go candidates that may not have everything. But if they have your core things, that could actually be a really good fit. And also, you know, finding people who are just a little too generalist because you're trying to get too many things on there and they're really not experts on any key things that are gonna be driving our success. So I think this is a brilliant strategy in terms of really diagnosing the company needs in terms of things that are going to help you recruit. Yeah. Yeah, that's right. And we're I guess, you know, as you've worked with some of these companies and, you know, potentially sort of seeding them make miss hires and things like that. Where do companies typically make mistakes on this or where do they hire? And and what what do you feel are kind of the underlying causes or reasons for that? Yeah, I love it.
[00:26:52] I love it. So it's going gonna take a little while. Two big parts to that question to put answer. One is in my book I read about the iceberg model. The thing that took down the Titanic was not the piece of vise that was sticking out of the water that was easily visible, but the mass of ice that was underneath the water was 10 times bigger. And that's usually the case rate like when you put a piece of ice in a glass, just a little piece of it sticks out of the, you know, the surface line that the mass is underneath the water. And I equate that to recruiting. Right. The piece of ice that's above the waterline or the words, the actions, the behaviors that people exhibit. And that's like surface level stuff. And the mistake that most hiring managers make, whether it's a CEO or any hiring manager makes, is that they get bamboozled into listening to the words and the actions and the behaviors when rather they need to look. I see that recruiting is actually a leadership competency and that like all competencies, you can actually get better at it. Right. And so like all facets of leadership, you can develop your own personal leadership capabilities. But you have to actually make an effort. You have to read books. You have to learn from people on how to do these things.
[00:28:08] Right. And she'll recruiting, I think, is about learning that competency and learning the recruiting competency is all about learning how to actually interview people and understand who they are through discourse. Right. So the things that I look for and the things that I work with my client on are understanding what's underneath the surface line of the iceberg. And that includes things like values, beliefs, motivations. Right. Because when you can actually understand the intrinsic motivators of a human being and then you can actually build this thing that is incredibly important business called trust. Great. And what happens when you don't do that is then you end up having the right, you know, employee handbooks and manuals and a whole set of rules that have derivative sub rules and all these different rules just because you want to get people to, like, actually behave the right way. Prescriptive. Yeah. And so, you know, I think I think teambuilding is really two things. It's the hard core called recruiting of the right people. And then culture. It's really those two parts. And I say this. Look, there was actually a big study done by Deloitte. And, you know, they studied like thousands of people hiring managers and people that were hired. And really, what they came up with was that there were two big reasons why anyone succeeds or fails at any company.
[00:29:31] And the first reason is by far the biggest reason bigger than the secondaries in the first reason has everything to do with culture fit, whether their personal DNA matches the cultural DNA of the founder of the CEO or the leaders of the organization. The second reason, and that's responsible for about 60 percent of the reason why someone succeeds or fails at any company, about 20 percent of the reason why someone succeeds or fails at any company has to do with their technical capabilities. And what happens with interviewing and recruiting is that most people spend entirely too much time focused on their technical capabilities, on looking at their resumé, what they've actually accomplished. Right. And what I like to do is read between the lines. Tell me why. You mean what's in between the two experiences? Why did. You leave that place. And why did you go to the other place? What were you hoping to find at that other place? And was that actually true? Right. What is their judgment and decision making look like and what drives them or are they themselves, you know, driven by by things at the surface level or their intrinsic motivators, their values, their beliefs, their motivations are aligned with our core values as an organization.
[00:30:45] I can't agree more. I've seen so many, so many teams that, you know, have huge opportunity. And there they're going down the scaling process. They're higher, you know, key executives. And six months later, you know, they've let them go.
[00:30:58] And, you know, it was a perfect technical set. This person, you know, had done this multiple times and taken a company from NRBQ multiple times, you know, but when it came down to it, they just couldn't work effectively together as a team. And if your teams are going to work psychadelic together, then you're just you're dead in the water.
[00:31:12] Jali That's right. I can't tell you how many clients, you know, I recruit out of Google and Facebook and Amazon all the time. And I can't tell you how many clients think that that's like the magic silver bullet. Great. And that's exactly what ends up happening is, you know, those companies are already big. Right. You know, the best people that built those places would there are like fifteen years ago. They're like, no. And it's exactly like these kinds of things. Right. It's almost like shiny penny syndrome.
[00:31:40] They think that that's the thing because they have Facebook on their resume that they're going be a great hire. And in fact, you know, I often say, look, it's the opposite.
[00:31:48] What? Any good strategies or questions are hard. How do you actually read between the lines? Is there anything that you could recommend to folks that are, you know, if they're going into an interview and they're looking at the lines on the resume, what can they do to kind of dig in under that and get to that 90 percent that's below the waterline in terms of that person's, you know, the motivators, the drivers, the beliefs, the values, you know, above and beyond, just the results of that kind of technical skills that are the source.
[00:32:13] Yeah. You know, so there is a book that I read that actually kind of really helped form my thinking around how to do this, Bruce. And I do recommended although it was written by a p_h_d_ in organizational psychology and is it is guaranteed to put you to sleep in like three pages. But that book is top reading and it's actually fantastic. I read that book, you know, and I agreed with it with a lot of it. The challenge I had is that it requires you to spend like thirty seven hours interviewing each person. And it was really read better late. You know, the CEO of G.E. or somebody and nobody has time for that. And so the book that I wrote hires Smart from the start. In a lot of ways, it's kind of like an adapted version, you know. You know, I figured out through practical experience how to actually do this in eight to 12 hours and have highly effective results, rate the prices that I drive. And I'm going to talk a little bit about my prices.
[00:33:05] But the prices that I drive is designed to not just get one person who's gonna fit this role and be spectacular, but to actually create a completely different problem for my client, which is they're going to have three finalist candidates that are so strong that they're going to have a pickle of a time deciding which one of the three to prioritize a finalist.
[00:33:27] And that's a plan that I create every single time. And it's starts by, number one, really kind of understanding how to create that blueprint because that that's the target. Another big mistake that most hiring managers make is that, you know, let's say they need an accountant.
[00:33:42] They'll just jump in and start interviewing accountants and they might actually hire the best of five or six accountants that they interview. And that person will still only have 60 percent of what they need in that accountant rate because they never sat down to properly create the right blueprint. Anything that was ever great that was built by humans first started as a blueprint. So first and foremost, I always say, look, build a blueprint, get absolutely clear on, you know, if you're buying a car, you need to understand, do you need a pickup truck rather than a sports car or a family car?
[00:34:19] How many people? How fast? Frequently. What gas mileage did it?
[00:34:23] Yeah, exactly. Now, if you just go to some like auto mall and, you know, give it out what you know. I mean, you really have to put some thought in advance and again, move away from this concept of EGF. Right. Let's get clarity. I think clarity is power, right. Let's get clear on exactly what we're gonna do. Let's think on paper and let's write this down and get clearer. Let's create a blueprint and then I take them through a process. Right. And the process is this. The truth is that all recruiting has three parts sourcing, screening and securing. And each one of those reports, you know, the first part is the highest volume work and decreases over time. Right. But from a skill level perspective, the first part is the lowest skill. And then goes up over time in terms of skill required rate. And so a lot of times where recruiting breaks down is that one of these three things is not being done efficiently. Well, from a qualitative perspective. And so I'll get clear. In that sourcing part, Bruce, I will identify, you know, once we've created the blueprint.
[00:35:24] I will go out and identify who the best 40, 50, 60 people on the planet to come. So I've had this argument with some of the top venture capital investors around the country. And in the end, every single one of them says, Dave, actually, you're correct. ISIS seed the point. I see your point and you're correct. And what I've said to these people is, you know, look, Fred, you're oftentimes creating more damage than you are. Good. When you say to an entrepreneur, hey, here's a great CFO, if there's any two reasonably intelligent people could look at a résumé and say, wow, that's a great CFO, and they could potentially hire that person. It could be the biggest mistake of their life. And the reason is because that's not the task at hand. The task at hand is, is this a great CFO for us? Those two little words, let's change everything. Right. Because then it's about a process of defining first and foremost who we are now and then getting that clarity around who we need.
[00:36:22] Yeah, it's really I love that idea that first understand thyself, even the IS offers before you start figuring out who is the best person brand the company. I understand who we are and what do we eat. OK.
[00:36:34] So in terms of the process. You know, no one is sourcing Rachel. I'll identify 40, 50, 60 candidates, you know, and it's absolutely you know, it's important to you know, it doesn't have to be 40 people, but it but it has to be a substantial enough amount. You know, I'm just giving you kind of like that's usually my standard. It's somewhere between 40 to 60. Sometimes it's 80 or 100, whatever it needs to be. Right. And then usually out of about 60 people, I will personally engage about 35 of those people. And of those 34 and that's what added those 35 people. Then I will put in front of my client the best five to nine candidates. And every single time that I do that, Bruce, that results in two oftentimes three finalist candidates that are so strong that the claims can have a pickle of the time deciding which one of these to hire.
[00:37:22] Yeah. So it's really two. Two. You've got the kind of the questions and the filtering process and, you know, the numbers that you need at each stage to get to get to that higher, you know, three, two to three. Highly, highly qualified, high degree of cultural set for that group. So they can actually make decisions. I think a lot of times, you know, people end up. It's a false decision.
[00:37:42] That's right. That's like two candidates or, you know, one pretty good candidate and one the horrible's are there. Yeah. We got to decide their decision.
[00:37:50] And oftentimes, look, they just haven't met enough people or they haven't met enough of the right people. So by creating the blueprint and my process is designed. So if you're hiring that accountant, first of all, all six of those candidates coming in for an interview are already going to have a hundred percent of the technical capabilities required. Right. So that's like tables. That's minimal to that. Then we can do the qualitative work of really digging in to their cultural fit. Right. That that stuff under the waterline.
[00:38:19] Now, that's great. So we're gonna we're gonna hit time here. What if people want to find out more about you want more information about the book? Want to get into these three steps in more detail? Want to get the blue print? All that stuff, because we've covered a lot of great things and we could probably do another three minutes on all this. What's the best way to get a hold of that information and get more learn more about this process and how you work?
[00:38:42] So I'm at Dave Potter's dot com. Debbie w.b. Dave potteries dot com. And you can also find me at Dave Carvajal dot com.
[00:38:49] And I will put those links in the show notes here and we'll list the book and make sure people in the book is available everywhere.
[00:38:55] Amazon, Barnes,& Noble, Harper Collins published it. And, you know, look, there's a lot of work that goes into making it a New York Times bestseller. I haven't done that work, you know, largely because I'm not you know, that's not important to me. What is important is that it gets into the right hands. And those people seem to be finding me now.
[00:39:14] Excellent. I guess that it has been hugely valuable for the audience here.
[00:39:18] Just the insight you have, the experiences you've had as an entrepreneur and having been through this process personally several times, finding the right people, getting the right teams together, you know, achieving significant results. It's just fascinating to hear how you've kind of really zeroed in on this talent side and how to help these companies. They have this amazing opportunity, but also an amazing amount of pressure to make it work. Making sure they find the right people get on the right rolls who haven't been successful. David, it's been a pleasure. Thank you so much for taking the time today.
[00:39:43] Awesome. Thank you. Bruce, thanks for having me.
[00:39:07] You've been listening to Scaling up Services with Business Coach, Bruce Eckfeldt. To find a full list of podcast episodes, download the tools and worksheets and access other great content, visit the website at scalingupservices.com and don’t forget to sign up for the free newsletter at scalingupservices.com/newsletter.