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Finding someone who can run your biz when your business outgrows your abilities can go great or horrific but its highly likely to be one of the two. 
I want to share anecdotal stories that all occurred recently between me and my #2 (And the company’s #1), Crystal O’Neill.

Before we do, lets take a step back and have some perspective. If you business grows enough to where your “problems” are “how do I find someone to help me run and manage it?” Take a second in your crazy whirlwind to reflect on the fact that you got to that point. Good work, now lets get into it.

How replaceable are you?

You’ve got to take an inventory of yourself. If you run the business by the book (Max value of the asset), you actually are making it easier for someone to come in and take over. 
If you are more quirky and find yourself waking up some days wanting to do stuff that isn’t “hit margins” & “grow 40% YoY” then you gotta have someone who “gets you” and can help you see how you arrive at your decisions.
Examples for me, are I’ll tank margins to place bets on the future. We’ve given several people 2–3 raises in a year (Crystal got 3–4 double digit raises in her first year with me).
That means at any time, Crystal could get a “hey I’m thinking we grind margins to zero but triple R&D this year” kind of thoughts.

What’s your number & when do you want it?

The more you can paint a specific target at a specific time, the easier it is for a new operator to come in and build a plan to back into that. If you can say 5 years from now I want to sell the business & get a 5x EBIDTA, that’s much easier for an operator to come in and do. When you tell an operator that their job is to be “good to the team” & “do what’s right” & “grow the business” well those are HIGHLY subjective, making their job much harder. Crystal knows my 5 year goal is to love the work, the people we get to work with, and the clients we get to do it for every day. That is a REALLY hard target to hit.

I don’t have advice, I have stories of how I knew I had the right person

I hope for every founder out there who thinks, hmmmmm maybe I should get someone else to come in and run this company, that these examples give you some “sights and sounds” of what has transpired that helped me to identify someone who could take over for me, and can balance running the business operationally and culturally.

Here’s 5 small things I noticed in the last 3–4 months that are daily reminders I got the right person running this business.

Keep an eye out for these kinds of small things as people are coming up in your company, the stories here are just recent examples of things Crystal has been doing for 12 years at Seer. I’ve seen a lot of founders crash and burn on bringing in a “grown up” to help run the business, and it’s worked so well for me that I feel I owe it to share what helped me to feel confident in having someone come in and run the business.

Cleaning coffee spills in the fire exit
Crystal and I finished our 1 on 1 on the seventh floor of the Seerplex. She told me whats happening in the business and I listened, she told me where she thought my time investment would be most helpful and I committed to focusing. She filled me in on some legal updates and some people leaving Seer. With my update and marching orders our meeting was over. 
As we opened the door to rush to our next meeting and walked down the emergency stairs we bumped into a newer employee (less than 1 year and pretty entry level), the employee spilled a few drops of her coffee in the fire exit. 
Literally 5–10 drops worth, in a concrete and cinder block emergency exit, Crystal told the team member (who was apologetic) to go make their meeting and Crystal grabbed a roll of paper towels to clean up 5 drops of coffee in a rarely used an emergency exit floor. In her 12th year at Seer, she still sees her role the way I do… We’re not above anything to help. To me this matters as much as knowing how to manage a P&L.

Raises / Trust in Me
I began doing my annual check on our wage gap discrepancy and saw it got worse year over year. I was like WTF. Then it all made sense, we had some high ranking women execs/managers who weren’t at Seer anymore. Those few moves moved the average enough to get me a bit uncomfortable. But then I noticed something…Crystal has also given raises to 2 men in our company, 2 people who were stepping way up, so she gave them raises (and didn’t clear it with me), which is a GOOD thing.

But what caused our wage gap to be askew was that she gave some people raises above her salary.

So lets just back up a second, the person who runs the whole company, just gave 2 people raises that put them over her salary, and I didn’t know. 
She is running a company and was the 3rd highest paid employee, WTF! 
So I made sure that she and I would always make the same going forward. The moral of the story is humility and trust. Crystal knew that when I found out I would do right by her and when I confronted her, she said that was only salary and that she has a profit share so her overall was greater I was like yeah whatever.

Again, this is the kind of thing a leader just does. I’m appreciative to have earned her trust over the years for her to know if I ever see something off, I’ll make it right. I thought our maternity leave worked a certain way 6 years ago when Crystal took off, upon her coming back and me finding out that it didn’t work for her how I thought, I ended up paying her the difference (I think it was in the 10’s of thousands) she never brought it up, but by me jumping on it and making it right then, I think it earned her trust that in the end I’ll make things right, and she has done the same for her direct reports.

Volunteering

I had an open day, 10 or so people had volunteered at habitat for humanity, one by one people dropped off, including me. 3 were left and Crystal was still going to go she made a commitment, she JUST KNOWS that volunteering is a deep part of our culture and that any time she spends doing that she is living out our values and leading by example.. I felt shamed a bit I found an excuse to not go, and here she was living out our values better than I was, so I said eff this, I’m going too.

She leads by example, and that made me follow her, she knows that making our communities better is a real value of ours and in spite of her having 1001 things going on she chose to work in a warehouse cleaning up for habitat knowing full well that in doing so, she was going to go home spend time with the kiddos and be working late that night.

People Matter

There’s a theme here, Crystal doesn’t have a ton of free time, but she makes time for the things that matter and is willing to do the work to get it all done.
I was recently blown away when in our 1:1 she said she was going to grab coffee with one of our remote team members who lived about 2 hours away from the office. Crystal’s logic was simple…we had a co worker whom she hadn’t met in person, who lived only 2 hours away, so Crystal decided to drive 1 hour and meet them half way. She worked “remote” for a day with one of our remote co-workers who lived close enough for that to happen.

She just instinctively knows that if I could I would fly to everyone’s house to meet up with our remote team members if I could, but I have limits on how much I travel and its just not possible (She did approve my budget to have 2 apartments in Philly so remote team members could come to the office any time they want and spend time with co workers how ever often they want…we even pay for 2 flights per year for remote peeps to fly to a HQ). Lets take a step back on that too, I ask Crystal for all kinds of shit that financially could be seen as “hurting” our financials, but I just feel are right for culture, what is great is that she finds a way to make those things happen. Apartments in Philly and SD cost us REAL money, hits margins, but we want to make it easy for our team to come visit another office and stay as long as they want.

Here is our Director of Finance’s desk when you walk by:

She’s recently realized that our exec team should have more remote empathy, so she is forcing all of us to work remote for 2 weeks a year, so we can have more empathy for remote team members. That was her idea 100%. Love that she did that.

5 — SQL

All these stories are about culture. This one is about vision…I have been quite pushy about big data if you haven’t noticed 🙂 
One day Crystal just mentions in passing that she is taking SQL classes an has passed them. As if she didn’t have enough to do she quietly just got it done. She didn’t tell me what she was going to do, she just did it.

If you are the kind of person that likes working in the business instead of on the business (like me, I love hands on work, client work, etc) don’t let people tell you you shouldn’t. BUUUUUT what you need to realize is that if your company is growing fast the company might end up outgrowing your skills. Holding on too long is dangerous.

I never found it fun to sharpen my saw on getting better at operating the company, I wanted to innovate, work with clients, and help my team members to grow. It was such a drain to learn the differences been net and gross margin trends. If you find yourself like this start looking now in your company for an eventual replacement, Crystal was with me 6–7 years and on that journey kept getting more and more responsibilities. Operationally she was learning and was more of a natural than I was for sure. So when it came time for me to find someone, operations was important, but wasn’t enough, they also had to know how to check what is operationally good for the company and what is good for the culture. I got to see that with each promotion, she never allowed the ops to dominate decision making. It influenced decisions of course but I never had to come in and say “have you thought how that is going to effect the people here???”

How’d I get Crystal? Craigslist. 🙂 A reminder that you can find talent all around you. The bigger of a deal culture is to you, the more you are going to have to start grooming people early to see who might in 4–5 years be able to take more and more operational and cultural responsibilities. You have to see these people in action to know they can represent all the crazy in your head and not lean too far to “operational metrics”. Its’s part of why I really enjoy it 17 years later.

Our company was never supposed to be this big, I suppressed our team size to never be over 10 folks for a few years b/c I wanted to stay small. Then I realized I love watching people at Seer, and that growth often came from them getting new challenges / problems to solve for our company, and growth creates problems.

This 1 question helps me combat sentiment that happens in any growing organization and also helps me identify problem solvers:

“Execs are out of touch”

We hear it, the execs / managers don’t know the work I do. Ok, so how many times have you filled out what you were proud of? “Well, uh, …”

As your company grows, this sentiment will rise up! I find that having this weekly question helps me (and people’s peers) say to those people “are you taking the 5 minutes 1–2x a month to put these on the company’s radar?”

If that answer is No, then I get to say … that is on you.

“Execs don’t have time for me”

This past month I had an intern fill it out, and I responded to her, it felt great to open that dialogue with someone whom I would not typically work with.

More importantly when I have limited space in my calendar, I need to know what people are working on and how that contributes to the organization to choose whom I grab coffee with that week, and on any given week it can be a intern up to an executive. The power is in their hands.

By publishing my goals company wide (along with the tactics to help us get there) it helps people to know what I’m working on, so if your “what I’m proud of” helps me get closer to my big vision / goals for the company, you better believe I’m going to try to sit down with you or get someone who can.

“Problem solvers vs Problem identifiers”

This question susses out the difference pretty quickly. It helps separate those who want to talk about a problem from those invested in solving that problem. “

The “What are you proud of” question is not well answered by I’m doing too much work, that is what I am proud of.

It is well answered by “ for the last 6 weeks I’ve been working to automate ABC time consuming tasks, last week it worked, saving me 3 hours and I think I can scale this to others too.

Here’s an example of a dialogue with a person at Seer, notice how I also get my exec team CC’ed so they too know what this person is doing, which helps them prioritize whom to meet with as well.

There are some issues

Women vs Men — Specifically there could be a male / female dynamic where one gender isn’t as good as advocating for themselves. Doing it this way at least I have data I can join to people’s gender from my HR tool to the answers here to keep me in check.

Squeaky wheel — this isn’t the kind of thing to fill out every week, you need to help coach people on what are good updates by mediocre ones. Mediocre updates are fine, but they may not be as likely to get responses.

Execs / Managers — Its important to make sure your executives know its important to respond. (That part is very hard to track). My leadership style is one where I prefer to lead by example and see who “gets it” but sometimes you need to be more explicit.

I’ve always struggled with my desire to work and my desire to spend time with my team. At one point I found myself feeling stressed running from one meeting to the next to the next with no time in between.

I’m one of those people who HATES looking at his watch in a meeting, I like to show the person I’m engaged. For some reason, checking time in a meeting has always felt a bit rude to me, so I disliked that feeling. By removing back to back meetings, I can allow them to “spill over a little bit” and stay engaged if I need to.

I’m bad with note taking in meetings, always have been, working on it every day, still I’m a 3/10 on my best day. Giving myself 15–30–60 minutes in between meetings enables me to do a little prep for my next one, and wrap up my thoughts from the current one. Back to back meetings make me a bit anxious because I know I’m more likely to be forgetting something, and when I get to take notes, the 2–3 back to back meetings start to blend together, making me less accountable to the meeting I was in.

It gives me time to decompress, I disliked running into a meeting almost out of breath b/c I was trying to stay in one and make it to the other. It just felt a bit crazy to run from, one to the next.

Admittedly I’m fortunate in that I spend probably 50% of my time out of meetings, whereas other roles might spend more of their time in meetings and might not have a choice. On occasion it still happens, but I find having this as a rule of thumb to be quite helpful.

This one is painful. Times have been so great for Seer that I haven’t had as much pain to share in a while, well that changed at the end of December 2018, as we wrapped up a great year.

First, we lost our largest client after a great run with them. So we already had to buckle in for a slower growth year in 2019, all good as I was MEGA proud of the team to be able to retain one of the fastest growing companies on the planet in their largest division on a global project for 5 years.. The client gave us a ton of heads up so I appreciated that, it gave me time to prepare our company for what was going to come, we have a strong nest egg, so I thought…we got this.

Halfway through the year I made everyone in the company book a vacation paid in part or whole by the company, the team had been working quite hard and we had profits to deploy.

Then as we approached the end of the year in spite of us knowing that this client was leaving I doubled down on bonuses. I didn’t need all those profits to stay in the company and our nest egg covered us. As the year started wrapping up, I was letting Steve and Crystal know I wanted to deploy these profits to the team in a meaningful way.

Then I got the call from Crystal. Wil, I gotta tell you something, its big.

Gulp.

I found out we overspent for the client that left us by 200k in a matter of 38 days. Which means I also wasn’t going to be in a position to make it back over a year or two, I couldn’t waive fees, I was effing stuck. They were already leaving and we were helping to transition to the new agency. I hadn’t announced the bonuses, so in theory I could have peeled them back a bit and covered the 200,000 overage from just a part of what I was holding for the team, but that didn’t feel right.

Crystal was already communicating this to the client, that we’d make it right. It’s an easy choice, if someone did that to us, that’s what we would want them to do. So there was never a question in our minds that we were going to return this money.

Here’s some of the lessons I learned…

Fire people…

I’m a believer that the people who caused the issue to happen are probably the most dedicated to helping you fix it. Firing them means you’ve just let go the person in your company closest to the issue, who is also feeling some heat and likely would like an opportunity to make it up to the company. That person is probably more dedicated than anyone else in the company to solving the problem. I bet that that person / team is probably thinking “I want to save anyone at Seer from ever feeling this way”. This quote played in my head as I thought about how to address this.

If people see someone fired at the first sign of a mistake, you teach people that the way to keep their job is not fucking up. If your job is to not fuck up, you don’t innovate b/c it could risk your job. While this was more of an oversight than an innovation mistake, this also rang in my head as well. I want people to feel safe to innovate here.

But give them a tight timeline

Remind people of the gravity, in our case it was like this mistake cost us 5% of our profit (200k) and probably 15% of our divisional profit. To make up that hit we would probably need to land 6 new projects that same day and have them be with us all year. This is serious.

The strongest folks will come to you with a plan with an aggressive timeline. If they don’t, push them. At this point if you gotta work on the weekends that’s what you are going to have to do. If you gotta spend $1,000 of your own money to take a class to build the solution, that’s fair, I just lost $200k I think $1,000 is fair and you’ll gain skills.

Get an early feel, do they act like the house is on fire and they are running in to put it out, or are they still leaving at the same time they used to, coming in at the same time, not communicating regularly, etc? This is a BIG deal and you gotta feel them out quick.

Growth brings complex problems

The skills required to run a project of this scale are different then the skills required to run most other projects. If you’ve been growing and promoting internally, you might want to stop and ask yourself, wait a second, do we need some new / different skills to help guide us that have been there / done that? Very few of us do that in the midst of killer growth, but one day something breaks and now what was a small number a few years ago, is a BIG ONE because your clients got bigger.

Stop right now. Seriously this is a threat… where has a division grown from where it was 2–3–4 years ago, and what are you still holding on to?

Pay attention to early warning signs

We missed the opportunity to build the solutions we are building now as a result of this loss. The few times we had a $5,000 overspend here and there we didn’t pounce on it with the vigor that we should have. We chalked it up to an occasional overspend and an honest mistake, we didn’t stop and think, what if we had a client who spent 20 Million a year, that small mistake we learned from last year is in a whole new ballpark.

Respect your growth

We are great with how we manage budgets but this client is the kind of client to throw 1–2 million additional for you to spend on an initiative for 1 month. So our systems worked, but just a few days over starts to add up REAL quick. Don’t wait until it’s too late to pressure test your processes/systems as your clients and their complexities grow; as the human error and mistakes grow exponentially.

Again stop. Ask yourself, what process do I have today that I would need to model out our growth at 2x 3x, or 5x. Steve recently walked our exec team on a conservative growth exercise over 10 years. 10 years from now we’d be about 1,000 people if we kept growing at a similar clip, imagine the things that break down.

Management structure, contract structure, office space, how the hell do we recruit for that many people? How many of our nice perks would be open for abuse that we couldn’t track. When you are flying that many people around, what kind of discounts can we get from airlines, it goes on and on, but it’s worth it. etc etc etc.

Communicate it and let it go

I think about this every day, every. freaking. day. But I can not allow that to impact how I treat my team members, but its going to be effecting me, maybe I put more pressure on getting deals done (to make up for the loss), or innovating on a solution (to make sure this doesn’t happen again), or I get tight on expenses for the next few months, rejecting things I used to approve. You start doing that, if you haven’t communicated this issue team wide, people are going to start wondering:

Why is Wil checked out, why is Wil distracted, why is he freaking out about getting this deal done, why why why…

That’s why you have to communicate it, to have a “dog in the fight” and combat rumors. Don’t let your team “make up” a narrative, but if you don’t tell em, they are going to make it up.

Communicating it also shows the gravity and allows other team members to come in with the firehose to help. (BTW asking your founder “how can I help” isn’t very helpful, it places the cognitive load back on me to think of your skills and how you can help at an already stressful time) try saying something like…I’m going to talk to person X and present you 3 options by Y date.

Letting it go

You are going to be interacting with the people who had visibility over this issue, that lost profit prevents you from doing all kinds of things, that ferrari I wanted to buy (sike), that vacation I wanted to take with my kids and my wife, that bonus I wanted to give to the team, that office build out I wanted to do, that new office opening, all the things I wanted to do with that $$ and its just gone, poof. Seeing those people every day in all honesty can become a reminder of what you “don’t have”, what you couldn’t do, etc etc. You have to just suck it up, you are an executive of a growing company, if you are going to go around giving those people the stink eye every day, or reminding them every day of their mistake that just gets abusive / shitty. It also deflates their desire to fix the problem.

Culture check

this is the kind of thing that helps you see how your execs and team members act internally and externally in times of crisis. Do they stay transparent with the team, how do they balance telling people but NOT throwing others under the bus? You’ll see your team tested, keep an eye out for it.

Leaders step up

Who is saying to you

“I can’t take my bonus in good conscience”
“Look you in the eye and say I’ll solve this by date”
“Wil, I gotta tell you what I plan to do about this”

To them it’s like putting a man on the moon, exactness is everything. Here’s a running total of how much you lost & I’m going to make half of that up by Dec 31st 11:59 pm. Here’s my plan.

Ineffective leaders in times of big mess ups tuck tail and avoid tough conversations. I’ve seen people make mistakes and basically avoid talking to me for months. I lose respect for those people, you gotta own it.

Insurance

We hoped insurance would cover this, errors and omissions right? We made an error and we should be covered, right? WRONG. So make sure to talk to your insurance agent, get the insurance before you need it, b/c when you are growing, everything is about team growth, client growth and managing that, rarely does anyone say in the midst of all this growth, what about our E&O insurance now that we’re landing these big deals.

We’ll be better as a result

This mistake, while costly, has caused us to innovate, question processes, and create timelines to improve them. It also was a culture check, did we share this transparently, yes, did we give people a chance to make it up, yes, did my executives do the right thing in the face of this, yes, are our clients better off because of this, yes, did we learn, OH YOU BET WE DID!

On to the next.