Amos Schwartzfarb & Trevor Boehm: Levers: The Framework for Building Repeatability into Your Business

Transcript

[0:00:31] DA: Want to build repeatable revenue for your business? Amos Schwartzfarb and Trevor Boehm’s new book, Levers, shows you, step-by-step, how to identify and move the levers that unlock growth and create predictability across every aspect of your business built on decades of experience across hundreds of companies. Levers condenses the essentials of creating a metrics driven company into five core workshops and puts them directly in your hands so you and your team can get to work, spanning sales, marketing, product, operation and finance. Each chapter and workshop puts you one step closer to finding a model for growth that is repeatable and controllable. Hey listeners, my name is Drew Applebaum and I’m excited to be here today with Amos Schwartzfarb and Trevor Boehm, author of Levers: The Framework for Building Repeatability into Your Business. Amos, Trevor, thank you for joining, welcome to The Author Hour Podcast.

[0:01:22] AS: Thank you so much for having us, Drew.

[0:01:25] DA: Let’s kick this off, can you give us a rundown of your professional backgrounds respectively? Amos, why don’t you take it on.

[0:01:32] AS: Great, I’ll go first. I have been playing around in the startup world since the mid-90s. I’ve been a part of six different companies from very early stage, a couple of which I was the founder, a couple of which I was an early employee. Those companies have exited for nearly a billion dollars in aggregate, I did have one crash and burn in that as well. Then, for the last six years, I have been the managing director of Techstars in Austin and I also wrote a book called Sell More Faster that came out a couple of years ago.

[0:02:09] TB: I started my career kind of hodgepodge of things, it was a part time writer, I was a musician, I worked in community development among the immigrant and Native American communities and then some of my way into entrepreneurship first at an agency that I ran and then in a social commerce company that I ran after that to the startup and then jumped over to the operator investor side working with Amos at Techstars and across a couple of other programs, investing into close to 50 companies throughout those programs and startups.

[0:02:45] DA: How much have you two worked together and is this your first book together? I know you just mentioned that there was a previous book, Amos?

[0:02:53] AS: Yeah, we’ve known each other I think – we met before Trevor was at Techstars, we’ve probably known each other four or five years. Trevor may remember more specifically than that and then we work together at Techstars for two and while he wasn’t directly involved with Sell More Faster, he was behind the scenes. He actually helped me quite a bit with thinking through because Trevor has some experience with books as well in editing.

[0:03:22] TB: Yeah, so over that couple of years, we worked together really directly all on early-stage companies so we collaborate quite a bit on helping, working with other entrepreneurs that we’d invested in and came alongside. We spent a lot of time together in the trenches thinking through core business problems or you know what I do about go to market strategy or how to be more data-driven in our purchase. We worked together a bunch.

[0:03:48] DA: Now, why was now the time to share the stories in the book. Was there something inspiring for you, was there something so simple as you might have had a little bit more time on your hands because of COVID or was there an “aha moment.” We need to write this down.

[0:04:03] TB: You know, as I mentioned, we’ve been working together for a couple of years and we were getting into a rhythm around how we thought about how to create repeatability into businesses and that’s really kind of the core idea or insight that we were coming around. I remember actually, this is in the book. Amos and I, early on in our conversations together, I asked him, “Hey, you’ve been a part of some pretty successful companies, what is it that you saw that made them work versus the ones that didn’t?” His answer was something like, “In those companies that worked out, I could see how they were going to succeed before they would, I had a sort of mental model for the path to success,” and so, as we started to begin to define what does it actually look like or what’s the systematic way by which you create that kind of mental model, we were building frameworks for other companies to execute on that and it just started working. There was a way to predictably create this kind of repeatability within companies and so that was really the spark of the book so I remember actually – Amos, I don’t know if you remember this or not — but you grabbed me late one night, we were in a group of a bunch of founders, you sort of pulled me into a room to the side and you’re like “Hey, what if we wrote a book about all the stuff, what if we put it together?” I thought the idea was crazy but here we are and actually have it done.

[0:05:33] DA: Now, a lot of authors have the idea of the book rattling around in their head so maybe you two got together, you said, “Hey, we’re going to write this book about this subject,” but during the writing process and sometimes by digging deeper into some of the subjects, you come through some major breakthroughs in learnings. Did you two have any of these breakthroughs along your writing journey?

[0:05:52] TB: My breakthrough or I think the big breakthrough for us, as we wrote the book wasn’t necessarily in any of the individual components of it and the book is really five core workshops that we’ve been doing for years that we’re putting into one context within the book. I think the insight or the breakthrough was actually in that sort of the whole being bigger than sum of its parts. It’s understanding how the sequence of those workshops build together in a way that really can transform a business. Enable them to be data-driven in a way that I think most founders would never think about. They sort of understand the idea of being data-driven or at least they’ve heard of that phrase before but they don’t really know or I think a lot of us really don’t know how to do we actually apply to that to the business and to me, the big “aha” for us, especially as we were writing was just how well these workshops fit together to create that kind of understanding.

[0:06:54] AS: That’s great. I think for me, it was a little bit different, I really appreciate that what Trevor just said, I believe that I understood how the workshops always worked together, really because it’s how I’ve been running businesses for the last two decades. Pieces of this and it was in the putting of the pieces together over the course of that time, understanding the path that it can put a business on to getting to repeatability and scale. I think for me, there were definitely many “aha’s” — some of them were really small, little tweaky things but I think the big one was, I talk about this with Trevor and we have two other contributors in the book as well. I talk about this with them a lot, which is just how broadly this book could potentially impact business builders all over the world, of all different types. While we come out of the tech industry, we’ve put this process through with people who are outside of the tech industry as well and have seen real live results. I think for me, the “aha” was just how broadly this has the potential to impact business builders all over the place.

[0:08:10] DA: When you were writing the book, who did you have in your mind that you were writing the book for? Is this a book for startup entrepreneurs only? Or did you think, “Hey, established businesses or business owners can have takeaways from the book as well.”

[0:08:25] AS: I’m laughing and I definitely want Trevor to weigh in too if I’m saying anything different. I’m laughing because what you’re describing is also chapter one of the book. Just to step back, the book is like Trevor said, it’s really a series of five workshops that culminate in the ability to build a data and metrics driven business and to have an actual plan to do that. What we’ve tried to do in the book is to demystify that process and really break it down into five easy steps. It’s a progression, there is a step one and a step two and while like Trevor just said, each step could be a standalone, the sum is greater than the parts. The very first step is what you just asked, which is for anybody building a business, who are you trying to build it for, what are they actually getting from you and why do they care? I giggled because of course, we do think about this quite a bit and that’s why when I say that the notion of how broadly it can potentially impact people was one of my big “aha’s” is because we really started building this form the mindset of how do we help earlier stage companies figure out what they’re doing. Earlier stage tech companies and I think what we’ve come to realize is there is a lot of value for those companies and yet I think the companies that we ended up really focusing on is companies that are generating some revenue but they haven’t yet figured out repeatability in their business. When they haven’t figured out their repeatability but they’re making money, they’re like, “How do I continue to do this, why does this have to continue to be so hard?” What we’re trying to do for them is to help them figure out, how do they feel less out of control, how do the have greater alignment across their organization?

[0:10:16] DA: Are there similar books like this out there? If so, how is yours different?

[0:10:22] TB: I think there are a lot of books around the early-stage idea validation, kind of formation part of the entrepreneur’s journey. You could think about Lean Startup or anything by Steve Blank, a bunch of resources out there for early-stage entrepreneur saying, “What do I have to do to get started?” I think similarly, there is a good amount of books that cover the kind of later parts of the journey as you think about organizing the work of the business. In that scenario, I’m thinking of what looks like Traction or the EOS process or things by Verne Harnish and so I see this book as we think about Levers is really bridging the gap between those two. There aren’t a lot of books that talk about what does it actually look like when you’re at that stage of some, as Amos mentioned, “Some revenue” but you're really trying to figure out, how do I get to repeatability or in other words, how do I identify the levers of control, that are out in my disposal. To make the business work so that I can have more control, more clarity and more alignment as a team and that’s what we saw to do this, the gap that we saw and the resources that are available to business builders today.

[0:11:46] DA: Let’s dive into just like you said, right in the beginning of the book and this is the first line of the intro and it’s, “What makes some companies work and others not?” I’ll ask you that question, what are some of the really, really big mistakes that companies are making out there and what are some things that companies that are succeeding, what are they doing?

[0:12:09] AS: I’ll start with the thing that we have seen and to anyone who has built a successful business out there, they will probably nod their heads is that when you truly understand your metrics and the levers of control in your business, you’re actually able to do something you understand why it’s working, you understand what happens if you do more of it or less of it and how will it impact all the different aspects of your business. Being metrics-driven is something that’s very key. Sort of the biggest mistake or mistakes that companies make, you know, one, at a very high level, not being data metrics driven. Going off of things like intuition and gut is a great place to start but it won’t help you build a big business. You, at some point, you have to be able to validate the assumptions that you have around who your customers are, what they’re buying from you, why they buy it. You have to validate your assumptions about what your business model is and what the actual levers in your business model are. You have to validate your assumptions on “what to build when” and you have to be able to measure those things. The companies that make the biggest mistakes are not doing one or multiple of those things in my opinion.

[0:13:20] TB: Yeah, I’d add to that and say that another place that companies and CEOs in particular and business builders in particular can lose focus early on is by chasing after something that isn’t actually going to drive long-term sustainable growth in the business. Most commonly, especially in the tech world, that’s going to be fundraising. You can get enamored with the idea of how do you tell a meaningful and compelling story of where the business is going to go but totally lose sight of the fact that at the end of the day, the business is an engine that generates and kicks off cash and if you don’t know the engine that feeds that and you don’t have the ability to drive that engine, you don’t have a business.

[0:14:09] DA: I think what’s really interesting about the book is that you actually ask the reader to do work and you actually say in the book, “If you read the book and put in the work, the exercises required, you’ll start to see a few major things change.” The question is, how much work is required as you’re reading the book? What kind of work are you putting in and what changes can you expect to see?

[0:14:29] AS: I really am glad you asked this question because when Trevor was describing what’s unique about the book or what makes it impactful. I think this is one of the things that when we set out to write it, we didn’t want to write a bunch of theory that you had to go figure out. We really wanted to give the reader who is a business builder. We wanted to give them something where they can almost have like a play-by-play of, “If I do these things, I will be able to actually get some sort of an output.” It may not be the output I’d hope for but I will get something tangible. We tried to give them some really tangible work to do, which are the frameworks and to try to quantify the number is a little bit hard because on some level, it’s ongoing and forever but I would say, if you sat down with the book and your goal was to read the book and as you’re reading through the book, go through the exercises and do the work and apply to your business with your team, you are probably looking at between 20 and 40 hours of work over the course of some period of time.

[0:15:31] TB: I want to make an addition to what Amos said around this idea of let us make the work as practical as possible was a really strong goal as ours and that was the one that I add that when we say that, what we don’t mean is we’re going to tell you exactly what to do because we don’t know, right? Your business is your particular context that you’ve got to go figure out. The work then is actually — or our jobs, the way we see our jobs as authors is to actually give you the building blocks to go build the recipe. We are not the recipe, we’re the tool kit that shows you how to make your recipe and so what you’re doing is taking those frameworks, internalizing them and then putting them into your business so that you can understand the levers that move it. In terms of the impact or what that work is going to do for you, it really is organized around what we think about as three core things. The first is clarity or in other words, if you do the work in the business you and your teammates will start to say and understand what’s happening in the business in a much clearer way. You’ll know what’s working, you’ll know what’s not working and they’ll be data to back that up and the second thing is what we think about as communication or alignment around that communication. In other words, you’re all going to be saying the same things. You are going to feel like you are rowing in the same direction. You start to use the same kind of language to understand where the business is and where it needs to go and then that is going to bring a good amount of alignment or to the team as a result. Then the final piece is control and the way that we like to phrase this is that you are going to feel a little less out of control because the work of building a business is chaotic in its nature. There is all kinds of things you’re never going to be able to control but you can narrow that region of what is out of your control and really the promise of the book is to increase that, increase what’s within your realm of control so that you can move the business forward and build a large one.

[0:17:32] DA: Now, while you’re reading the book — is it a step-by-step guide that builds on every chapter and you need to build the foundation into and before you get to the next chapter or can folks have individual takeaways from the chapter. Let’s say you really want to dig into the KPI’s of your company, can you readjust that chapter and have takeaways?

[0:17:50] AS: The answer is yes, “yes and”. Absolutely every – you could go into anyone single chapter and walkaway and feel like you’ve gotten something really valuable from it and not touch any of the rest of the book — a hundred percent for sure, and I think the thing that we’re really excited about is that sum is truly greater than the parts. If you do it and you’re doing it in this sort of stepped way, it helps you gain like a level of clarity overall that you can’t get when you are doing just one piece. For example, if you’re, you know, chapter one is figuring out who your customers, you’ll do a lot of great work on that but if you are focused only on that, then you’re focused with just that the team that’s required to execute that when you step back and say, “Okay, this is one part of a bigger piece of my business, it is much easier to understand how the work you’re doing there actually impact the other parts of your business.

[0:18:53] DA: Now, Trevor, you actually mention this earlier in the book. It is actually very introspective, you are asking the reader to ask themselves in their business questions but what happens when you ask yourself these questions and the answer is again as you say in the book, “Holy shit, we still have a lot of work to do.” What happens when there is panic after asking yourself these questions?

[0:19:15] TB: I think the first thing to realize when that experience happens and it will happen, it’s not a matter of if, it’s a matter of when is to tell yourself and your team that’s exactly where you should be and that’s exactly where thousands if not hundreds of thousands or millions of other business builders have been before and it’s just a part of the process of figuring out one, there is way more unknowns than there are knows and two, the path to getting to those to turn those unknowns into knowns is long and it’s hard. Our hope is that the tools in the book don’t just leave you with a holy shit moment but actually put in front of you clear next steps to then go out and test and get into the world and pick a particular hypothesis or make a particular kind of debt and then go test it in the world, see what happens and then of all this go. That is the beauty I think and some of the power I think of the book itself is that we’re not just trying to I guess and maybe the cheesy metaphor would be like, swallow the whole elephant at once. You can break down each piece and starting it at one bite at a time and so I think that is really where the sequence comes in understanding that you could tackle each of these pieces at once but by focusing first on your customer for instance and understanding who is that person, what are they actually buying from you, not what you’re selling but what are they buying and why and then as you start to get clarity around that, then you could move to the next step — Which should be revenue formula or in other words, how did you actually make money, how do you mathematically make money and so you can tie that customer into a mathematical equation that spits out revenue at the end. What has that customer purchased and how did they purchase it from you and how does that equal revenue from you and then you can move progressively from there.

[0:21:12] AS: I want to add I think I 100% agree with Trevor but I want to add a little something to that, which is we’ve been respectively teaching this process to hundreds of companies of all different types for a long time and in fact, you know, Trevor and I also we do just that. We have a consulting business that does just that and the feedback that we get when people get to that moment like over and over again is, “Holy shit! But also, I know exactly what I need to do and I know why this is what I need to do and if this is wrong, I know what I need to do next and if this is right, I know what I need to do next.” It goes back to that clarity and control aspect that Trevor was talking about, which is — those “holy shit moments” are going to happen many, many times in your business and a lot of times, you’re sort of swimming in the dark on I hope that I am headed in the right direction and you bump into something eventually and you know sometimes it works and sometimes it doesn’t and this really does help put you on a path that you understand why you’re on the path.

[0:22:20] DA: Now, some of the chapters in the book, you actually bring up real boardroom experience or meeting room experience and some conversations you’ve had with smaller companies, some bigger companies. Can you talk about one of the situations in the book where you sat down with an executive, together you looked at a whiteboard and use one of the processes in the book that led to some great success for that company?

[0:22:44] AS: Yes, so I think I’ll call out a company that we’ve actually worked this process through with over the course of two and a half years, three different times as the business have continued to evolve and by evolve in some cases, there was some actual pivoting in the business and in other cases, it was just evolution of what they were doing. The company started out as an on-demand dog walking service marketplace. Where someone would have an app, they have a dog and they would get on the app and they would say, “Hey, I am looking for someone to walk my dog” they’d find someone to walk their dog and the dog would get walked. Then that business was working really, really well and as that CEO, Maggie Williams, went through the process for the first time, started to identify some of the weaknesses in that business that she might not have otherwise recognized. Which started to put her on a little bit of an exploration of how do I basically hedge against these weaknesses. In that process, the business shifted a little bit and as it was in that shift, went through the same, the entire process again. That business was actually working and then in that process, sort of continued to iterate, you know finding the things that were working and weren’t and trying to figure out how to hedge risk. Ultimately is now in a position where they are running an extremely fast-growing, extremely profitable business in the pet care space that doesn’t look anything like the business that they set out to originally, the dog walking business. They know run and operate facilities that are social facilities where you can bring your dog, you can have drinks, you can have dinners and they’re starting to expand very rapidly because they have figured out how to take what they’ve done and then turn it into a business that has great unit economics. They understand their metrics incredibly well and so because of that they’re able to do things like get financing to build out additional locations and they’re seeing they are actually beating their metrics by a lot and they’re doing this by the way in the middle of a pandemic, which is only to say, needing to understand those levers becomes even more important.

[0:25:04] DA: A reader comes in, they’ve spent the time, which you say 20 to 40 hours, they are asking themselves questions, asking the business questions, they have new metrics they are looking at but the question is now what happens? Are there any more resources that you provide for readers post-finishing the book or are there resources that you could suggest to readers who finish the book?

[0:25:26] TB: Yes is the short answer. One exciting thing actually is you get to the end of the book, I’ll get to you question about what happens afterward in a second but as you get to the end of the book, there is a culmination of each step in the process is a fully-operational financial model that you’ve built yourself from scratch that really will be once you have it a kind of crystal ball into the future of your business. Understanding what are the key levers that I can turn up or down in order to drive growth in the business. One of the things that we do to help the reader as they start to create that financial model is a template that they can play around and learn with so that they may take their own knowledge back and make their own from scratch. That’s the first thing and they can go to leversbook.com to access that after they read the book. From there and this is actually some of the work that we’re most excited doing, we’d love engaging with companies to help them better understand their levers. To help create better repeatability and we’ve designed a program that’s really aligned with each step in the process within the book and it goes much deeper in depth into each step in the process. There are five key workshops that correlate with each chapter of the book and we’ll come and we’ll get a group of companies together and work with them as they develop each part of that framework and then we’ll come together. We’ll meet, we ask the hard questions about that framework. We evolve it, we give them feedback on what we see and then they also learn from each other. It is a real cohort-based experience where they are saying, “Hey, how do I take what I’m learning in my own business?” share it with you so that you can inform your own learning and your own business and really end with something that’s better together. After the book if people are looking for more resources or saying, “Hey, I really resonate with this idea of getting more control in my business” particularly if you are one of those business builders that has some revenue but haven’t quite got to that. It’s a repeatable, we know exactly what to do in order to create and grow that revenue overtime, this is a great option for them to come inside of a very intimate experience to get real feedback on what they’re doing.

[0:27:44] DA: Well Amos, Trevor, you know we just touched on the surface of the book here but I want to say that writing a book like this, which is really in depth and it is going to help so many entrepreneurs that’s no small feat. Congratulations on being published.

[0:27:58] AS: Thank you.

[0:27:59] TB: Thank you.

[0:27:59] AS: Thank you very much.

[0:28:00] DA: One last question for the both of you and this is the hot seat question, so prepare yourself and through lucky there is two of you today so one of you could take some time to think about it. If readers could take away only one thing from the book, what would you want it be?

[0:28:14] AS: If there is one takeaway that I would like to give anyone who reads the book or you know, who reads the book would walk away from is that in order to build a successful business, I really do need to understand what the levers of control are in my business and I am willing to do the hard work to figure that out.

[0:28:31] TB: I’ll just add to that that as you are in that journey, you find yourself wanting help or you come up with some big “aha” and want to share it or just feel stuck and need somebody to help identify those levers, reach out. We’d love to hear from you.

[0:28:50] DA: This has been a pleasure and I am really excited for people to check out the book. Everyone, the book is called Levers and you could find it on Amazon. Amos, Trevor besides checking out the book, where can people connect with you?

[0:28:59] TB: You could find us at the book website, leversbook.com. There will be a contact button there so please, reach out to us over there. We’re pretty accessible over social media as well so feel free to find us on LinkedIn or Twitter as well.

[0:29:14] DA: Excellent. Thank you so much for coming on the show today and best of luck with your new book.

[0:29:17] AS: Thank you so much, it was really nice meeting you.

[0:29:19] TB: Thank you.

[0:29:21] DA: Thanks for joining us for this episode of Author Hour. You can get Amos Schwartzfarb and Trevor Boehm’s new book, Levers, on Amazon. Also, you can also find a transcript of this episode and all of our other episodes on our website at authorhour.co. For more Author Hour, subscribe to this podcast on your favorite subscription service. Thank you for joining us, we’ll see you next time. Same place, different author.