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Guest: Oliver Seidler, CEO of Property Force, a company that specializes in the use of technology and marketing to buy and sell real estate contracts.
Episode in a Tweet: Your numbers, your team, and your vision can lead your business to a pivot from small to BIG.
Quick Background: Two college best friends create their dream startup. Sounds like the classic entrepreneur fairy tale. Except the startup was a real estate company, and the year was 2007. You can probably guess what happened next – that is, until Oliver Seidler decided to pivot from a small company stuck in survival mode to a BIG business.
On today’s show, Oliver explains how he used technology, key performance indicators, top talent, and a commitment to his vision to pivot Property Force into a scalable, multimillion dollar business.
Transcript: Download the full transcript here.
Key Insights on How to Pivot BIG
1. When the going gets tough, the tough think BIG.
Oliver didn’t let the worst economic downturn in a generation squash his vision. Instead of just keeping his company afloat, Oliver kept thinking about how to make the company thrive, and scale.
“By 2010, we were able to start putting some systems in place and then grow the business,” Oliver says. By 2013, Property Force had expanded to four offices across Florida. By 2014, Oliver had bought out his partner and started looking for ways to economize, and improve efficiency. By 2015, Oliver had centralized Property Force’s operations and created a powerful digital platform that allowed him to “instill a culture that was much easier to manage, hire better talent, and scale out.”
Because Oliver never stopped asking questions, never stopped innovating, and never stopped envisioning BIG success, Property Force didn’t just survive the Great Recession, it came out the other side as a better, and more profitable company.
2. Let your KPIs be your guide.
One key to Oliver’s successful pivot was good old-fashioned number-crunching. The expansion offices that helped sustain and then grow the company while the economy recovered were becoming expensive and out-of-date. His P&L statements told Oliver that there had to be a better way to get the company BIG, more quickly.
Centralizing and focusing on tech freed up cash for a huge advertising push that Oliver knew would create much more potential business than his old model. CEO Coaching International also helped Oliver re-think how he modeled his P&Ls.
“Once I blew the P&L up to a $30 million, and then eventually a $100 million mock up, I started to see how much bigger the advertising could be than relying on auctions and MLS listings,” Oliver says. “So a lot of it was just feeling comfortable that at $30 million these other two sources are minuscule. Letting go of those sources and putting our focus into the advertising, which was much easier to scale, much faster to scale, became easy to do once I saw what the P&L looked like on a much bigger level.”
Now, P&L modeling is part of Oliver’s annual process, and adjusting that model is a top quarterly activity. And everything still filters down from Oliver’s top KPI, the return on marketing. “If I spend this on marketing and I get this return, it all works,” Oliver says “The cost of goods sold are this, the fixed expenses are this. This is what my marketing spend would be. This is all I need to get back for each dollar spent, and as long as I’m getting this, I can just keep growing.”
Do you know the financial formula for your business? What the key drivers are for your profitability? The levers you can pull to make profitable growth happen? If not, now’s the time to dig into the numbers and figure it out. Oliver’s “aha” moment came at 3:00 in the morning. He couldn’t sleep, went into the office, and started putting numbers on paper and it all came together.
3. Hire for tomorrow, not today.
“I can’t afford to hire the best person for this job,” say struggling CEOs as their businesses plateau. But top bosses like Oliver know that, “You need to put the $30 million team in place while you’re at $10 million.” Just do the math. Ask yourself, “How much would the best head of sales or the best CFO add to my company’s bottom line?”
That’s what Oliver did, and as is usually the case, the growth and expertise generated by a top hire more than justified the added expense. “We were looking for a controller, and we said, ‘Okay, we want to spend $80,000 on a controller,’” Oliver remembers. “But then I started looking at the P&L at $30 million, I saw it was insignificant if I spent $80,000 on a controller or spent $120,000 or $140,000 and got an amazing controller/CFO. That mentality unlocked us to get the controller/CFO that we needed, to go out and find the marketing person we needed, and not really care if they cost $120,000 or whether they cost $200,000.”
Oliver also came to realize that Property Force was outgrowing his ability to function as both COO and CEO. “My capability level as a COO stopped at $10 million. I put somebody in that role of COO, got myself out of it, and they’re much better-suited to scale the company up.” That’s the kind of accountability the best CEOs are able to apply to their own performance. Doug Lebda of LendingTree made a similar discovery.
4. Focus on your goals, not anyone else’s.
It’s easy for entrepreneurs – especially young ones – to get so caught up in the rat race that they let external factors change the direction of their business. This can lead to a fatal lack of focus if the CEO starts chasing after every shiny new object in the business space, or can’t keep his ego from defining success only in comparison to how competitors are doing.
As he grew as a CEO along with his company, Oliver learned the difference between carelessly wanting more, and wanting to be BIG, his way. “I think it starts with knowing what you want, like what size business do you want,” Oliver says. “Whatever you decide that number for your business is, start with it and say, ‘Here’s the number that I want to build.’ That gives you the roadmap and gives you the freedom to spend the money, build the team you need to build, cut revenue streams that you might need to cut, understand the numbers, and let that guide your decisions – but you’re guiding those decisions based on a bigger vision. That’s where I am different today than I was two years ago: I know what I want and that’s all I really care about.”
1. Stick to your vision. Don’t let outside forces – even a Great Recession – keep you from building your company your way.
2. Know your numbers. Track and measure the stats that are going to drive your growth, and use those stats to incentivize your sales force.
3. Top employees pay for themselves. The difference between paying a competent employee and paying a superstar will vanish when that superstar helps scale up your business. Don’t be afraid to pay up for top performers.