Chris Lee started a company in his garage and scaled it to $233 million in revenue. But he was once bankrupt. So, how did he transform his life? By the end of this episode of the Conquer the Chaos Podcast, you’ll know how.
Listen to learn Chris’ journey to success and why your vision is the key to becoming a great leader and surpassing even your most ambitious goals.
Mentioned in this episode:
Transcript
[00:00:23] Clate Mask: Welcome, everyone, to this episode of the Conquer the Chaos Podcast. I’m Clate Mask, your host of the Conquer the Chaos Podcast and co-founder and CEO of Keap, and I'm really excited today to have an amazing conversation with an entrepreneur I think you can learn a lot from. Chris Lee is joining us today.
[00:00:41] Clate Mask: Chris, thanks so much for being with us. I appreciate it.
[00:00:44] Chris Lee: Excited to be here. Thanks for having me.
[00:00:46] Clate Mask: You bet. Hey, Chris, why don't you take a second and share. You've done some amazing things. You've built a company, 1,100 people … Incredible in the niche of solar and sold to private equity. You've had all kinds of wins through your career, and now you're doing some things to teach entrepreneurs some of the things that maybe slip through the cracks or don't get executed very effectively. So I know there's a lot of value you're going to give, but maybe take just a second and help our listeners understand your journey as an entrepreneur and what you're doing now.
[00:01:23] Chris Lee: Yeah. So, I mean, obviously it sounds like a nice fairy tale.
[00:01:28] Chris Lee: Does it say I built an 1,100 person business and sold it for nine figures off to private equity … You know, that sounds great and grand, but there were many years prior to that led up. I've had, essentially a 20-year entrepreneurial career and for the first 12, 13, 14 years, it was nothing but a struggle and a grind … Moving me and my wife — we have five children — and over my career, we've moved 14 different times.
[00:02:01] Chris Lee: And so we've chased it. We've hustled. I've knocked doors. Sold things online, flipped hot cars, houses, built my first business — built it too fast, too quickly. The economy and a bunch of poor decisions led to a bankruptcy of $2.2 million, losing everything, having less than $1,000 in my bank account, car repoed out of my driveway.
[00:02:27] Chris Lee: I've owned a search engine optimization business, cows, flipped cars, vehicles and things on Facebook and Amazon and eBay … Pretty much anything to make a buck. But most of it served as some level of an education. So there was a point in my career where I decided I wasn't figuring it out on my own, even though I was doing all these different things, there was more for me to learn from the corporate world. And so I went back to work for somebody else in 2012. And for four and a half years, I worked for three different businesses purely with the intentionality of studying how they were scaling and building their businesses.
[00:03:21] Chris Lee: I called it my paid education because I was making good money. I made $300,000-$500,000 a year. And I was just taking notes on why the CEOs and executives were operating the way that they were.
[00:03:36] Clate Mask: That is an amazing education and for all of our listeners. There's something you heard in there, in all of the experience that Chris has, that we're going to draw on and have a great conversation about this. So let me just see if I can summarize what I heard you say.
[00:03:54] Clate Mask: You built up a business, built a huge team, 1,100 people sold to private equity for nine figures, and while that happened in a relatively short period of time, maybe five or six years, it sounds like, what I heard, the first 14 years was really all of the education and foundational work you did, and that some of it was school of hard knocks.
[00:04:16] Clate Mask: Some of it was as an employee studying what others were doing. But probably a lot of quote-unquote failures and a lot of lessons learned. I hear bankruptcy. I hear all kinds of different things that you were doing. And amidst all of that, you were gaining an education that became the foundation that you used to build a business that you ultimately sold for nine figures.
[00:04:40] Clate Mask: Is that a fair synopsis of what you just said?
[00:04:44] Chris Lee: That's a fair synopsis. And the only thing I would add to that is in 2015, a couple of years before I started my business, I made a commitment to myself that I would really invest in my personal education. And from that point on, every quarter, every three months, I went to a mastermind, a course, an event, I was part of coaching something.
[00:05:08] Chris Lee: And between 2015 and now I've spent over a million dollars on these types of things. Most recently, I'm a part of a Harvard program. I graduate this fall from it. It's the highest-level executive program that they have. It's called Owner's President's Management. And of the 168 people who are in my group, about 50 of them are billionaires.
[00:05:34] Chris Lee: So just the commitment that I made at that time to go and spend the money, even when I didn't have it, to really understand that it's not the money that makes me successful. It's the experience. It's the knowledge. So I've just become a weapon that can go and execute over and over again.
[00:06:00] Clate Mask: Chris, I love it. By the way, I think that the principle of investing in yourself is one of the things about business success that sometimes gets put on the back burner because people think, “Oh, I'm so busy doing the business,” that they missed the point that it's the growth. That growth and development is what opens up the capacity for the business to really take off.
[00:06:34] Clate Mask: As I've certainly seen this. You've just articulated it that as you become more successful, you lean in and you invest more and more and more in your growth and development. For people who take this principle from the world of sports, I remember a couple of years ago — I'm a big NBA fan.
[00:06:56] Clate Mask: And a couple of years ago, Chris Paul was on the Phoenix Suns and the Phoenix Suns are my team. I love the Suns and Chris Paul's good friends with LeBron James. And they were talking about how much they invest in their performance and the amount of money that they spend on nutritionists, therapists, chefs, sports psychology — all kinds of different personal services around them so that their home and their personal life is functioning effectively. People might think, “Oh gosh, these guys make so much money. They literally spend millions of dollars to make sure that they perform effectively as an athlete.” And so what you've just articulated with the Harvard OPM program that I'm certainly familiar with and with so many of the other coaching and development programs out there, sometimes entrepreneurs either don't invest to get to that next level or they get to that level and they stop investing.
[00:08:01] Clate Mask: I know personally myself, at times, I've been like, “Whoa, my investments are down a little bit right now. I need to be investing more.” And sometimes it's the dollars that make you do the things that you need to do. So you have to put that skin in the game. So I appreciate you drawing out that principle.
[00:08:16] Clate Mask: And before I dig in a little deeper on some of the things, I want to just acknowledge the amazing family that you have — for your wife and five kids to go through the journey you've been through. And for me and what I talk about in Conquer the Chaos … I talked about the six keys to success, but the definition of success, as I say, it is balanced growth in your business and personal life.
[00:08:41] Clate Mask: And you and I have both seen way too many incidents of entrepreneurs that are quote-unquote successful, but that's in terms of how you would measure it in dollars or at work and the business. And yet the personal life is just a mess. And so I just want to acknowledge you and your family for going through all of those crazy things over 14 years and being able to get to a place where you're able to build that business and have an incredible financial outcome that I know has enabled you to do some really fun, amazing things, including the property that you have your family on right now.
[00:09:17] Clate Mask: I read about that. That's fantastic. And I just want to acknowledge you and your family for that because sometimes, the family gets forgotten about in the process, either by the entrepreneur or certainly by the people who are studying the success of the entrepreneur. And you and I both know it doesn't happen without them.
[00:09:33] Chris Lee: Absolutely. Yeah. My wife has definitely been the bedrock of everything. So, yeah.
[00:09:40] Clate Mask: Awesome. Awesome. You bet, Chris. Okay. So let's … You have such an amazing perspective on leadership and having built a business to 1,100 people. Now I would love to spend some time on leadership and the intentionality that's required to create an amazing business.
[00:10:00] Clate Mask: And by the way, for anybody out there that's like, “Oh, I don't … I'm not going to build a business of 1,100.” The principles of leading people — the sixth key to success I culminate with leadership because it really is where all of those other pieces come together and you start to create an amazing impact in your business when you're intentional about leadership. You and I, before we jumped down to the episode, talked about some of the things that you've done, some of the things that we've done and I've been involved with elite entrepreneurs.
[00:10:32] Clate Mask: And so I really want to dig in, in this episode on the key to success of leadership and get practical and tactical about how you do that intentionally, very intentionally. So maybe give us just a brief overview of some of the things that you did to get a business built up to 1,100 people in a way that didn't break you in the process.
[00:10:55] Chris Lee: Yeah, for sure. So, I think one of the most important things when you have a goal that you're going out after is creating clarity. In society, we are so unclear about everything. We’re like “how much money do you want to make?” “Oh, a hundred thousand dollars.” Why? Why is it this round 100,000 number?
[00:11:25] Chris Lee: Or “What do you want to do?” “All I want to do is fun stuff or good stuff or great stuff.” It's like there's no clarity behind any of it. Most of us are chasing somebody else's dream. Most of us are chasing something that society fed to us regarding … “Oh, once you have a million dollars in your bank account, you'll be successful, or once you have accomplished X, you'll, you'll be successful, or this is what you need, or this is what you want.” You want the sports car, you want this, every day, when nine times out of 10, the things that we say that we want, we don't even really want.
[00:12:02] Chris Lee: So I think one of the biggest things when becoming a leader and developing is helping identify clear goals of like, “why am I in business?”
[00:12:20] Chris Lee: And so, from the get-go, I've always known that I want to be rich and it's not just to be rich for rich sake, but I have a very intentional heart, and I love blessing other people. And I have big, hairy, audacious goals when it comes to running a charity that gives back and builds underprivileged communities and develops entrepreneurs from people who don't have the financial means necessary in order to do so,
[00:13:05] Chris Lee: I have a very clear goal that the way that we change the world is through developing people as entrepreneurs. Entrepreneurs have the greatest impact in the world, right? And the reason is everybody has to have money. And so if they initially come into your organizations thinking that they're going to get a paycheck, and they leave better contributors to society, better fathers, better brothers, better mothers, sisters, better servants, better people that make sacrifices to build their communities. They're more spiritually fed. They're more … All these things. And if we as entrepreneurs can understand that that is what people really want, we can change the world.
[00:13:52] Chris Lee: And so for me, I love changing the world and I'm very passionate about it. I get emotional when I think about it. Some of my greatest experiences are the text messages I get from a boy that hasn't worked with us in a year. And he sends me a text and he says he's lost 120 pounds and all because of something that I taught him, or somebody says like, “Hey, we worked through our marriage issues and now we're good.” Or I've had multiple employees call me at the point of wanting to commit suicide and they knew that I would answer. It's amazing. And so, when I think about what I want and I think when we're talking leadership, you have to understand like, what is it that drives you and what is it that is your gift to the world?
[00:15:03] Chris Lee: Because each of us are completely different, but when you get clear, then you can start building a vision and really vision is what leaders get behind. Whoever has the greatest vision will envelop and build the greatest team. And…
[00:15:26] Clate Mask: That's a great point that I want to make sure people get. Whoever has the biggest vision will envelop and create the greatest team. And that's a fantastic point. We know that where there is no vision, the people perish. We know that vision is necessary to inspire people and that best, get people in a place where they want to give their best, they want to create. But you articulate it in a way … A lot of times I talk about this with entrepreneurs when they're raising capital, I say, “you've got to have the vision and the story, but I've never articulated it quite the way you just did.”
[00:16:06] Clate Mask: And I love that. When you've got the biggest vision, it will envelop and enable the creation of something really, really big.
[00:16:15] Clate Mask: Okay. We're going to keep this going, but first a quick message for you. Conquer the Chaos listeners, let me talk to you straight for just a minute. You're running your business, and it dominates your mind. It can be very difficult to take a step back and see what's needed to create balance in your business and your personal life, and to create great growth and development and progress in your business and personal life.
[00:16:36] Clate Mask: One of the most powerful ways to gain the perspective that you need is to get away from things and immerse yourself in an environment where you're going to be inspired, where you can see possibilities, where you can create connections, and where you can learn and grow and develop. And I know of no better place for entrepreneurs than Keap’s Let's Grow Summit. For years. We ran this conference as just an amazing mecca for entrepreneurship. And then, truth be told, for a few years, we didn't run it. We got back to it last year, and this year, we're putting it on and it is going to be awesome. I am so excited about this.
[00:17:14] Clate Mask: And I want you as our listeners to not miss out on this event. It's going to be November 20-22 in downtown Phoenix with the main days being the 21 and the 22. You can register for it by going to keap.com/letsgrowsummit. That's https://keap.com/letsgrowsummit. And you can take advantage of our early bird registration pricing, which expires at the end of July.
[00:17:37] Clate Mask: So if you are needing a reflection time, an opportunity to take a step back, gain greater perspective, inspiration, and most of all, see what automation — the fifth key to success — can do for your business, then make sure that you attend the Let's Grow Summit. Keap.com/letsgrowsummit, November 20-22 in Phoenix. I look forward to seeing you there. Alright, now back to our chat.
[00:18:02] Chris Lee: I mean when I say that, I think of Elon Musk … I'm a pretty freaking awesome visionary and I have a big vision, right?
[00:18:11] Chris Lee: Because of what I want to do for the world, I have been able to back in and create detailed outlines of how I'm going to go and create it. But a guy like Elon Musk, he's got a greater vision than me, man. The guy wants to, he wants to inhabit Mars and he wants to re-power the grid differently.
[00:18:31] Chris Lee: And he changed the way that we produce vehicles and he wants to land rockets back on the earth. I mean, this guy thinks big. And from the standpoint of if Elon were to call me today, even though I have a really big vision for what I'm doing, he said, “Chris, I want you to go and run this division for me.”
[00:18:51] Chris Lee: Chances are I'm going to close shop and go and work with Elon because he's got a greater vision than me. And so when you're building leaders, like I said, you have to have the biggest and clearest vision. And so the way you get clear is one, you have to understand what you want. Two, you have to identify the exact roadmap that's going to get you there.
[00:19:16] Chris Lee: And so, this starts with a vision and a mission statement. A mission is what you're about. A vision is what you're going to accomplish. The core values are the things that you want to support getting you there, right? The people that represent this set of values that are accomplished. And then you have to build it backwards. For example, when I launched a business out of my garage, I'm sitting in a 400-square-foot garage — cement floor, drywall, probably has cat piss everywhere, barely has a window AC unit in my shop, right? And I'm sitting with like two people and I'm like creating this. I'm like, “Okay, five years from now, we are going to be doing … In order to accomplish the goals that I have to change the world, I need to be doing a hundred million dollars a year.”
[00:20:14] Chris Lee: “And in order to do a hundred million dollars a year, this is what I have to back in.” And so then I started backing it in like, “okay, what is the average sales rep selling our industry? So it's going to take 70 sales reps. We'll use the law of management. That means I'm going to need 10 managers, two divisionals and one director.”
[00:20:36] Chris Lee: “Okay. So that's my five-year roadmap. Now, operations. What is it going to look like?“ And doing the work of creating a clear vision and direction of a roadmap with an org chart, roles, goals, responsibilities, how we're going, and then the overall customer experience that we're going to create — all this work. And it's not just like … As brief as I'm talking about, it's like going through and identifying and writing it out and going in. So when I sat there in that garage, I had a roadmap that was going to get us 500 employees and a hundred million dollars a year.
[00:21:15] Clate Mask: Right.
[00:21:16] Chris Lee: And that was the roadmap that I went and I would reach. And when I would sit down and recruit people, I'd be like, “Look, in five years, we're going to be one of the nation's largest solar providers. We're going to be the gold standard of the solar industry, so that's our vision statement.”
[00:21:34] Chris Lee: Our mission statement was, “Hey, we're going to build a brighter future for our people. We're going to help them become better physically, economically with their associations and their spirituality. We're going to have our core values of, oh my goodness, synergy, outside the box, love of family, generosity, excellence, and no excuses.”
[00:21:55] Chris Lee: This is how we're going to go accomplish it. Yes, you're coming in and I know we're sitting in a sweaty garage right now and there's no AC and you're coming in at the ground floor. But six months from now, this is what it's going to look like. And we're going to need management here. We're going to need this, that, and the other.
[00:22:11] Chris Lee: And just painting the vision and being so clear on the direction we were going, people started to believe and come in and be developed based off of this crazy idea of what we can go and accomplish. Right? And here's the crazy thing. Fast forward five years, I had a roadmap to get us to a hundred million. We actually went beyond, and everybody thought I was crazy. Like, of course, nobody.
[00:22:39] Clate Mask: I think it's crazy until you do it. Right. And then they say, I knew you could do it all along.
[00:22:44] Chris Lee: Yeah. And here's the thing. Here's the thing about a leader. A leader is an evangelist, and what you're trying to do as an evangelist is not get others to believe in your vision. You're trying to get others to believe that you believe in your vision. And so, they're saying to themselves, “Dude, this guy is crazy. There is no way in heck that we're getting this thing to a hundred million, but he looks pretty certain on this. He is so clear. He knows the exact steps that he's going to get there. He believes it. I might as well give it a shot and just see if I can tag along for a ride.”
[00:23:35] Clate Mask: That's a great way to say it. When you're building belief, what you're really doing is building belief in them that you believe in the vision. Then what I've experienced is they start to believe it. And as my coach has always said, “when enough people believe it's going to happen, it can't not happen.”
[00:23:53] Chris Lee: Yeah, exactly. And the crazy thing is, like I said, my initial plan was to do that. We built more. By the end of five years, we did our last year and as I sold to private equity, we did $233 million in revenue and we had 1,100 employees.
[00:24:11] Chris Lee: If you'll notice the revenue to employee was almost the exact one that we had created with the roadmap, and that is because of the work that had been done. So along the way, vision is the number one thing to develop leadership. If you don't, if you lack that, nothing else matters.
[00:24:34] Chris Lee: There are so many other important principles like trust and transparency and having hard conversations and everything else to support that. Number one has to be the vision.
[00:24:49] Clate Mask: Well, and you called it out. The key word is clarity. I appreciated the way that you took us through all of the different aspects of it. There's the mission and there are the goals and there are the roles and responsibilities and the people and creating the picture and helping people understand that. We literally wrote out the picture — we called it our Everest mission as we were going through that stage, and we were helping everybody see it and understand what it looked like as we're climbing that mountain together.
[00:25:20] Clate Mask: So I have great appreciation for that. Now, let me pull it back to the listener who’s got two employees right now who maybe doesn't want to create a 500-person company. There's a lot of … By the way, I agree with you 100% on the impact of entrepreneurs. You and I have a very similar ethos and my life purpose is to love, inspire, and enrich others.
[00:25:49] Clate Mask: And I hear that come out in you very clearly. There's a lot of entrepreneurs who, at least where they sit right now, they don't want to go build something big. By the way, as you and I both know, sometimes you get to the next mountain peak and then you see the next one. You're like, “Oh, now I can see that. I want to do the next thing. And the next thing, the next thing.” But let's just for a second … Because most entrepreneurs are in a place where … “Listen, if I could get to a place where I could go from the two or three or four of us to a team of 10 or 15 or 20, where we're achieving the revenue goal, the take-home pay, the number of employees, the customer satisfaction and experience. that's great success.
[00:26:31] Clate Mask: So how do you … Take a second and maybe dial it back to the principles that are required for that small business entrepreneur to build a successful business from the two or three that they're at right now to the 10 or 20 people that they want to be in three years, let's say.
[00:26:49] Chris Lee: So, first of all, when you talk about somebody that has two people and they're just like, “Yeah, I don't want that,” …
[00:26:56] Chris Lee: First of all, you’ve got to ask yourself, Is that really what you don't want? Or have you just given up on your dreams? Like is this fear or self-sabotage that's keeping you from not wanting to go and accomplish your potential or is it really, you just don't want that? If you can look me in the eye and say, “This is what I want to accomplish over the five years, it's only a 10 or 15-man team, and this is the exact reason why I want to accomplish that,” and you have done the work and built it out. then I'll believe you. But if you're just like, “Yeah, I don't want that because …” and you give me some crappy excuse…
[00:27:37] Clate Mask: It's usually they don't want the problems that they assume go along with it.
[00:27:40] Chris Lee: Right, or just the fear of whatever society has told them, like money is bad, you're going to lose your family if you do this. There's a lot of fears. All the self-limiting beliefs because we've seen these things, as you referenced earlier, right? Like guys that go on this journey and just destroy their family, destroy their morals, destroy everything else.
[00:28:04] Chris Lee: The only reason why that ever happens is because those guys were only clear on one thing: They wanted money.
[00:28:12] Chris Lee: They didn't know what they wanted money for.
[00:28:14] Clate Mask: Right.
[00:28:14] Chris Lee: And so for me, wherever you're at in the path, you just got to get clear on why are you doing this anyways?
[00:28:22] Chris Lee: What is your life's purpose? What makes you tick? What gives you energy? What gets you out of bed in the morning? For me, it's probably, for me and you, it's probably a little bit bigger than most, right? The things that we want to go and accomplish. Maybe it's the ability to just go fishing with your kids every single day.
[00:28:44] Chris Lee: And if that's it, then, okay, let's begin with the end in mind. What is the cost? Okay. There is a cost to everything, and the way that you pay a price is through time, energy, or money. There is no other way to pay for anything besides time, energy, or currency, and so, what is the cost of the thing that you want most?
[00:29:10] Chris Lee: And if the thing that you want most is to go and go fishing with your kids every single day, the cost is going to be, how many hours? How many hours do you want to go fishing with your kids every single day? What is it going to look like to sustain a lifestyle that's going to allow you to go fishing with your kids every single day?
[00:29:29] Chris Lee: Are you going to live in a two-bedroom hut? Are you going to live in a 23-acre mansion? Are you going to like … Going through that mental clarity exercise of exactly what you want and what it's going to take to fund it. And once again, funding isn't just money, it's time, energy and money. What is that going to take?
[00:29:49] Chris Lee: This is when I hold a five-year workshop and bring people into a room, no matter what industry they are in. These are the things that I go through with them first: What do you want physically, economically, your association, spirituality? If you fast forward five years and say, “I want to be at 12% body fat. I want to be hiking Mount Kilimanjaro. I want to be spending two hours extra per day with my children doing X, Y and Z. I want to be volunteering as a football coach in my community that's going to require two and a half hours extra.” … Literally going through the work, right?
[00:30:26] Clate Mask: Yeah. Yep.
[00:30:27] Chris Lee: Then identifying, okay, how much time is this going to take? How much energy is this going to take? And how much money is this going to take? Then you got to go and build it backwards. And one of the important things with building a business is most of us build businesses that take care of the short term. Like it makes money today, right? If I have revenue and expenses, that's a little bit of profit and with only three employees. But the second I go to 15 employees, all of a sudden, it actually goes negative. We build businesses that don't scale. The reason why it's so important that you start with the end in mind is you can actually say, “At 15 employees or 20 employees, will this one, fund what I'm looking for? Two, allow me the time and energy to be able to go and do these things? Three, be able to go through the ups and downs of an up and down economy? And pivot and so on and so forth. So I'll give you an example of things that don't scale.
[00:31:34] Clate Mask: Let me pause on that real quick. Because I think that is actually the key point that I want to draw out for people who are saying, “Oh, I don't want to build my business to this point or to that point.”
[00:31:48] Clate Mask: It's that they've built in their minds, as you called out, the first issue is they're probably not clear enough on what they really want and why they want it. And they haven't articulated that, but they've seen problems and issues associated with certain businesses. And they've set a block in their mind that, “Well, I don't want those things, therefore I don't want the business.” But what you just articulated was “No, you want to envision the business at that point in a way that it serves your personal life.” And that's the part where, when I talk about the business keys and the personal keys, they have to work together. And I really appreciate the exercise you take people through because once they realize, “Oh, okay, well, that business that has those problems that I'm watching, that I'm observing was not designed to serve the business owner and the personal life of the business owner in the way that I could design it if I wanted to do it.”
[00:32:45] Clate Mask: So that's the key thing that so many people … I think they get stuck, they see other stuff around there and go, “Well, I don't want that.” Well, hold on. Like Chris is saying, start with what you want and get really clear on that and why you want that. And then, design the business with 15, 20, 30, whatever that thing is, but design it in a way that actually serves the personal life.
[00:33:08] Clate Mask: Chris just called it. It doesn't scale. Another way to say that is it doesn't serve your business, your personal life — either financially with the time you want, the fulfillment, happiness, or satisfaction. So I love that you just took people through that because a lot of times in small business, the entrepreneur will, uh, They'll make, they'll draw conclusions about what it would be like at a certain place with, in the business without actually recognizing, no, I can design it a way that serves my personal life.
[00:33:36] Clate Mask: So I appreciate the way you described that calling it yet the business doesn't scale, meaning the business doesn't serve your personal life. Alright. So you're going to go into some examples of where people get into this.
[00:33:46] Chris Lee: So a few things with that, like. Whenever you build a business, you have to understand the law of management, which means one person can't manage any more than three to eight people.
[00:33:54] Chris Lee: Most people don't want to build a big business because they can't imagine having a hundred people report to them. That creates so much anxiety. They've seen it with certain business owners that have burned out having 20 or 30 direct reports. And so they're just like, “Yeah, I don't want that.”
[00:34:13] Chris Lee: But if you're building this backwards and using the law of management, you have three people to report to you and so on and so forth, all the way down. Now you have a business. I get the question all the time, like “Chris, dude, you have 1,100 people. How in the heck are you doing that?” I'm like, “Well, I have five people that report to me. Although I love all my other people, they don't report to me.
[00:34:37] Chris Lee: I go and I say hello and give them love and CEO-kissing-babies and shaking hands, but you know, at the end of the day, there are only five people who report to me. But yeah, going back to like things that don't scale. When you don't begin with the end in mind, you do things like this. “Oh, Mr. Sales rep, we can afford to pay 10% of our revenue to a sales organization, so I'm going to give you the sales rep 10% of the revenue as a commission.” And then what happens is when you want to grow, where does that money come for a manager to manage that sales rep now?
[00:35:18] Clate Mask: Right. Now you don't have any room for the management.
[00:35:20] Chris Lee: Yeah. Now you start eating into your profits — 2%, 3%, 4%, or whatever it is. And so when I'm talking about building things at scale, you have to start with the end in mind and say, “Okay, in the end, we want to give up 10% for our sales side and we want 11% for our marketing budget. What does that look like today that's going to allow us to have these three, four, five layers of management?”
[00:35:45] Chris Lee: “How do we incentivize and create the structure? How do we make sure that we're not giving away revenue or profit shares early on just because it's the only way that we can attract people? That just won't scale when we go to grow.” And so, we're getting off the topic of leadership, but at the end of the day, leadership is getting people to buy into the great roadmap of what you're going to build.
[00:36:16] Clate Mask: Yeah. It is leadership. It's like you said, it starts with the clarity of what you want and then creating a vision that people see how that all comes together and how they can fit into that, but then setting the roles and responsibilities. So maybe just in the last couple of minutes we have, I'd love it if you could take a second and talk … You've said several times the phrase, “Roles, goals and responsibilities.” And whatever you call it, we've talked about it many times … The top three in terms of responsibilities and objectives for a role, but getting people to be really clear on what they do.
[00:36:52] Clate Mask: Because it's one thing to be clear about the company's vision, but then you've got to get … Great leadership is creating clarity and you've got to get really clear with the individuals. So for people who are building their business, what would you say to them about roles, goals, and responsibilities that would help them to serve their people and grow their business more effectively by creating that clarity?
[00:37:13] Chris Lee: So first of all, understand that a role is … We'll use hats as an example. A hat is a role or a title within an organization. A hat exists regardless of who's wearing it. Most of the time we build out responsibilities based on the person that currently occupies the role. That's a problem.
[00:37:36] Chris Lee: That's a problem. You have to. separate the two and say, “I'm designing this hat. I'm designing this role with this hat.” There are three to four major responsibilities they have while wearing this hat. Every position, every hat has to have those three to four. So for example, if we're talking about a scheduler, their main responsibility is to manage the schedule of the installers, make phone calls to customers, identify problems that are going to hold up the schedule, whatever it is.
[00:38:08] Chris Lee: Those are their main responsibilities. If they do these three to four things, perfect. Then they've done their job. They've earned their wage. They've earned their … So that's the responsibility. So every position, every hat needs to have that. And then within that, they need to have standard operating procedures to accomplish those responsibilities.
[00:38:32] Chris Lee: For example, if I’m calling and scheduling a customer, the standard operating procedure would be like, follow this script, use this checkbox, do this. So if the customer says this, then you flow charts of yes and no, and so on and so forth. And these are things that you consistently are going to be building.
[00:38:50] Chris Lee: This is when you're talking about building a business. This is what actually building a business is.
[00:38:54] Clate Mask: You're actually building the processes, the workflows, the standard operating procedures …
[00:38:58] Chris Lee: And making sure that they all lead up to the grand customer experience that you want your end user to experience, right?
[00:39:05] Chris Lee: And so when you're first starting off, if I'm building a 500-person organization and I only have three people. I want to do my best possible job to create all these hats. As close to day one as possible or as front-loaded as possible. And then what I do is I take 20 of those hats and I give them to one of my two employees and I say, “Okay, you're wearing all 20 of these and you're going to have 60 different responsibilities.”
[00:39:34] Chris Lee: Now, granted, we don't have enough volume that it's really going to be crazy, but you need to make sure scheduling is done. You need to make sure permitting is done. You need to make sure that city work is done. You need to make sure that this checklist is taken care of. Now, what happens is the … what for growth map this allows you to do is as soon as that person becomes overwhelmed, you can identify a couple of hats that you can remove and give to the next person.
[00:40:01] Chris Lee: Then it becomes very clear, “Oh, okay. Now they're wearing 18 hats and this new person's wearing two hats. Once this person wearing two hats gets overloaded, then we split the hats and give the hat to somebody else. And then once someone wearing one hat is overloaded, we just need an additional person doing the same exact job.
[00:40:20] Chris Lee: That is the roadmap and the way to like think through the growth of the business, which really allows for buy-in and like, “Okay, this is how I move up in the organization. This is how I remove hats and focus on this one hat that works. So I'd say that's the technical aspect of that.
[00:40:43] Chris Lee: There's so many theoretical principles though of building out leadership that are really important. Above and beyond all this.
[00:40:48] Clate Mask: I really appreciate you going through the organizational structure of it because what I've found is that the concept of an org chart is very much … Entrepreneurs tend to be allergic to it.
[00:41:03] Clate Mask: It's kind of a corporate thing, but it's actually … There's an entrepreneurial org chart that is a developmental roadmap of the organization. And it's what you just described. It's actually like biology and cells. It's mitosis. These cells are breaking apart.
[00:41:21] Clate Mask: It's the roles that you have. It's multiple roles. And when you have too much work for one person to be able to wear all those hats and do those multiple roles, and you know because you've clearly defined the top three responsibilities. I call it the top three because you might have four or five or six or seven, but let's be really crystal clear on the three that matter the most in this role.
[00:41:42] Clate Mask: And people start doing all the different things and they start to recognize, “Oh, okay, it's time for this to split. We need to have this person take on these roles and responsibilities. I'm now doing this.” But what I love about it, in an entrepreneurial org chart or an entrepreneurial growth map, the way you just described it, what's happening is everybody is recognizing how to put their work into action, into the highest and best use possible where you're doing your best things and you're handing off the next thing to the next person. It's actually job creation. It's not the way that the government talks about job creation. It's the actual entrepreneurial job creation because value is growing as you do these roles and responsibilities.
[00:42:24] Clate Mask: It gets really fun for people to be a part of that organization. So I appreciate you going through that. I hope that as people have listened, they've taken some notes on this. The point that I would make to you is if you are … The way that I try to help entrepreneurs understand this is if you're thinking about, “Okay, where am I today?”. I like to have them do at least a three-year exercise. Sometimes it'll go to five depending on where they are, but in three years, what does the company look like? What is the organization that's required for that? And now let's put all of those roles and responsibilities on the page, and then you put the names of the people you actually have on the page and you can start to see all of the roles.
[00:43:03] Clate Mask: By the way, when you do this, people go, “No wonder why I feel so overwhelmed because I'm doing all these things.” That's right, but get clear on it. Then you can begin to take yourself out of the roles and you do that as there's too much to do. And you go into the roles where you do the best work and you hand off things to others.
[00:43:18] Clate Mask: So I, I really appreciate you taking people through that. It's a leadership principle in putting people to work in their highest and best-used seat. It also is a developmental process where you're helping people to grow and become their best selves. And you're also developing the organization to be able to deliver for customers and build out the vision that you start off with.
[00:43:42] Clate Mask: That was great stuff. Thank you for taking us through that. I know we've hit our time, but I'm sure there's some people who are like, “Hey, I'd like to learn more about what Chris is doing.” So where can people learn more about you, Chris?
[00:43:54] Chris Lee: You know, the best way would be following me on Instagram. Then there's, of course, links in my bios as far as … We offer a $9 trial to our courses that we have. I drop a lot of free content on Instagram. So just @ChrisLeeQB.
[00:44:13] Clate Mask: Love it. Alright. @ChrisLeeQB you can learn more about the different things that Chris teaches about leadership, but also across some of the other disciplines to help you grow and build a business.
[00:44:24] Clate Mask: Chris, this has been fantastic. Thanks for spending some time with me. I really appreciate it. There are so many things that you've shared that I'm like, “Oh my gosh. We could go on and on,” But I really appreciate your expertise and the experience you've had in building the business, and now I love what you do in empowering entrepreneurs.
[00:44:42] Clate Mask: Our purpose at Keap is to liberate and empower entrepreneurs to strengthen families, communities and economies. You're doing it. I love it. So fun to talk with you. So thank you for being with us and for everybody, this has been a fun episode of the Conquer the Chaos Podcast. As you listen to the principles we've discussed here, make sure you're applying those in your business. And maybe the one thing I would say is, how could you take what Chris has described here, expand your vision a little bit and create clarity for yourself, for your team members, for everybody that's associated with the business” Thanks so much, everybody. This has been a lot of fun until we talk next time, keep growing.