Ep. #1053 - Creating A Unique Business
Keep up with the latest episode of our Top Kansas City Startups series. Another executive is here to talk about creating a unique business in a crowded market.
In today’s episode of Startup Hustle, Matt DeCoursey opens the podcast door to Jeff Havelka. Our guest is the CEO of Beyond Warehousing, which is a full-service 3PL warehousing company. And the insights he shares on 3PL (third-party logistics) business and the value of company culture will help your business grow.
Want to meet all the companies included in our Top Kansas City Startups 2023? Get to know them in this overview article.
Covered In This Episode
When a man with military training becomes an entrepreneur, some tactical routines are adapted to business. That is what happened with Jeff, just like what he shares with Matt about After Action Review, among others.
The executives also discuss what Beyond Warehousing can do to help other businesses. And how to create a company culture that everyone will love.
Listen in for these practical tips shared in this Startup Hustle episode.
- Jeff Havelka’s story of entrepreneurship (02:19)
- The primary problem Beyond Warehousing solves (03:31)
- How does Beyond Warehousing stand out from its competitors? (05:28)
- The biggest challenge in the fulfillment of orders (07:09)
- Operational tactical: After Action Review (09:00)
- How military training influenced Jeff and his work (10:22)
- Enforcing extreme ownership (10:41)
- Beyond Warehousing’s typical client (13:27)
- Balancing invisibility and semi-invisibility with your clients (16:15)
- The importance of having a good warehouse management system and partner (18:13)
- The key to better employee retention (20:59)
- Difficulty in undoing bad company culture (23:07)
- Managing a fully remote workforce (24:07)
- Communication works in keeping work culture going (25:47)
- The biggest business problem Beyond Warehousing can help you with (27:56)
- Scalability for people-driven companies (29:39)
- Why is the start-stop mentality crucial? (31:57)
- How the pandemic changed Matt and Jeff’s outlook (34:11)
- Creating success in your business and getting the proper acknowledgments for it (36:41)
We tried to make it a place where we understand that we’re their livelihood. We want them to be able to come to work, want to work there, [and] tell their friends when I need to hire someone.– Jeff Havelka
Being very mindful and purposeful around what you’re doing. It has to become part of a pattern. It has to become just part of your life. This is what we do to continue to push this and keep that culture going.– Jeff Havelka
It is okay, especially for early and fast-growing companies, to have a start-stop mentality. Because you’re doing the right thing by tapping the brakes if the vehicle gets out of control and goes off into the shoulder.– Matt DeCoursey
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Moreover, our Startup Hustle partners can also offer others solutions, such as virtual assistants, grants, and business compliance, among many others.
Following is an auto-generated text transcript of this episode. Apologies for any errors!
Matt DeCoursey 00:00
And we’re back! Back for another episode of Startup Hustle. Matt DeCoursey here to have another conversation I’m hoping helps your business grow. What are you doing to create a unique business, service offering, or value proposition? What do you do to stand out? How are you different? How do you compete in crowded market spaces? That’s some of the stuff we’re going to talk about during today’s episode of Startup Hustle. Before I get into the guest and also the amazing accolades that we will be providing to today’s conference to today’s guests, a quick reminder that today’s episode of Startup Hustle is powered by FullScale.io. Hiring software developers is difficult, and Full Scale can help you build a software team quickly and affordably and has the platform to help you manage that team. Go to FullScale.io to learn more. If you’re not aware, that’s my company. We love talking to Startup Hustle listeners. So reach out. Let’s find some solutions together. With me today, I’ve got another one of Kansas City’s top startups. I’m really excited about today’s guests. We’re going to talk about some different things that we normally talk about. With me today, I got Jeff Havelka, and he is the CEO of Beyond Warehousing. You can go to BeyondWarehousing.com. If you want to save yourself the effort of all those key taps, just go down to the show notes and click that link. It’s the fastest way to do it. I recommend that you go do that right now so you can learn more about his business and why we are talking about it. Without further ado, Jeff, welcome to Startup Hustle, and congrats on being a top Kansas City startup.
Jeff Havelka 01:29
Awesome, man. Thanks for having me here. Look forward to the conversation there.
Matt DeCoursey 01:32
Yeah, well, let’s start that with a little bit about your backstory and what brought you to Beyond Warehousing.
Jeff Havelka 01:39
Yeah, it was kind of an unconventional path to get into warehousing and supply chain to start with. I started out as an actuary actually and have a master’s in HR. I had no intention of ever being in the supply chain. But during the recession of 2007-2008, I got an internship at a supply chain and did that for seven or eight years. And then spent time with Amazon for about eight years before I launched Beyond Warehousing in 2018.
Matt DeCoursey 02:09
He mentioned that 2008-2009. That was the last time I tried to be a student as an adult and the fifth college I dropped out of. I remember at the time it was actually a top-10 Business School or close to it at the time. And they were all adamant about supply chain logistics. And that was the big future and the big growth, and they weren’t wrong about that. Now, when it comes to Beyond Warehousing, and you know, here you are, your startup and in Kansas City, and there’s obviously a lot to figure out there. It sounds like you got your feet wet with, well, three PLs, so is that the category that you’re in? Yeah, we’re in three PLs, third-party logistics, and party logistics.
Jeff Havelka 02:51
So we’re warehousing for other companies. That way, they can focus on things like sales, marketing, and product developments and not have to focus on, you know, actual warehousing fulfillment of their orders or worry about that overhead. Do all that for them.
Matt DeCoursey 03:07
So is that the primary problem that you solve?
Jeff Havelka 03:10
Yeah, that’s the primary problem that we solve is that a lot of people are really good at certain things and not necessarily good at others. So we were really focused on just taking that burden off of the company. And we’ve got dozens of years of experience between my partners and me, whether it’s in manufacturing or at Amazon or the military, moving things around. So we’re experts at that. We’re not experts at product development. Our customers are, so it’s kind of our value prop there.
Matt DeCoursey 03:49
So we talked about creating, you know, unique business. And you’ve obviously got to do something to stand out as compared to, well, Amazon. Are they your competitor?
Jeff Havelka 03:58
No, no, Amazon, you know, they’ve got their own inventory. They do act as a conduit for a lot of our clients, even if they sell on Amazon, and we’ll ship stuff from our warehouses to the end customer or we’ll send it to an Amazon warehouse, even for some of our customers. Our competitors are typically going to be smaller like us, somewhere between 100,000 to 10 million square feet of warehouse space, some of them local, some of them across the country, but there are about 27,003 pl warehousing companies across the country.
Matt DeCoursey 04:42
So make yourself you can make that yeah, that’s the main premise of what we need to get into. Yeah, it’s like, how do you stand out?
Jeff Havelka 04:48
So how we stand out, and I think some of this came from the fact that my partners and I hadn’t been in three PL before we got into this, but as we were looking at kind of how we want it to be unique, we just kind of looked at what our core values are, and looked at what was out there in the market. There’s a lot of either poor customer service or a lack of transparency out there in the three PL markets. We’ve really tried to just be honest, to be upfront, deliver results, and just own our mistakes when they happen. And tell our customers how we’re going to fix it going forward, where that’s not something that was prevalent within the industry. And what that’s resulted in is a lot of just word-of-mouth marketing that’s come from that, and just kind of generating that brand and that name out there. That is a little different than a lot of the three fields that are out there. There are a lot of good players out there.
Matt DeCoursey 05:53
But there are a lot of players that just maybe aren’t a stand-up poker Hall and your box with their forklift and don’t admit it. Yeah, exactly. That’s like a real thing. I mean, I’m not going to pretend to be an expert on three PLs, but I’ve learned so much listening to Andrew Morgans’s weekly show. I hear it. Yeah, he’s been hosting an episode of Startup Hustle for two and a half years now. And he specializes in helping people sell more stuff on Amazon. But with that, I’ve also learned that that’s really expensive for sellers when you’re talking about like 30% of your sale, if and sometimes more. And you know, so that I know that I assume that you may offer some options that could be a little more affordable in some cases.
Jeff Havelka 06:29
Yeah. So it’s, I wouldn’t say that we’re the cheapest out there. But what we are is that we do take care of your product. And you’re in a clean house warehouse, you get service on time, so that’s what you’re not doing by your vendors and stuff like that. And those are kind of your intangibles that we’ve really focused on and tried to become experts on. And it’s just really that high level of service that you don’t necessarily get from everyone in our market.
Matt DeCoursey 07:00
Yeah, and the other part of the experience I have is I used to work for Roland, which is the world’s largest maker of electronic musical instruments, 5 billion a year in sales, they sell a lot of stuff. I mean, you’re talking like their warehouse in LA is like a couple of city blocks, basically. And, so dealing with clients or accounts that I had in 13 Different states when I mentioned the forklift in the box, that’s a real thing, like, and I worked in the piano and keyboard division, and those are big boxes. And someone in there said that was probably the most common, like, quote, a problem we had was damage or air and delivery. And you know, you said, well, how does a forklift poke home with these machines picking these boxes up and moving them around and whatever. And they do a lot of them, and occasionally you’re gonna mess them up. And with that, oh, my god, man, I’m trying to get someone to take any kind of responsibility for it. It was just like a daisy chain of I didn’t do it. Yeah, and on some levels, like I would spend way too much time, or people at headquarters or headquarters would like, who’s going okay, so we didn’t ship this out like this, right? And the buyer didn’t want to get something with a hole in it. So how do we fix that? And so, yeah, there’s, I mean, the struggle is real on that stuff. So it’s good to hear that you take it, you know, people, if you mess something up, take responsibility.
Jeff Havelka 08:20
And we’ve got a whole process around that where we call it our operational tactical after action review, where when we have either its customer reported issue or one that we find internally, we document it, and then we’ve got a process that we do five whys on it get to what the root cause was, and figure out, Is there something we need to change in our process to fix that going forward? Can you get that back to the clients, and hopefully don’t repeat it again. And that’s been the big selling point for us actually, so we’ve pulled it up in sales, sales meetings with prospects, and they, like, set for the week, for the year. Okay. So just seeing that we dig into that and kind of have ownership there, it is different is, when you’re busy, it’s hard to dig into things like that. But if you don’t get to those root causes of problems, they’re just going to repeat themselves, and they’re gonna, you know, snowflakes gonna turn into an avalanche. So we just want to prevent the avalanche there.
Matt DeCoursey 09:20
So you mentioned you have a military background. I know. But one of my partners has a background. And I was curious because, well, their military is obviously very systematic. Yeah, I find that people that come out of military training or background are systematic. Yeah. In many ways, because, yeah. How does that have an effect on the way you do things? Yeah.
Jeff Havelka 09:42
Yeah, my partner came. He is our VP of Operations. He’s been a mandate in various companies over the last decade. But yeah, he is very structured and very to the point and also forces the ownership there. And I think that has driven a lot of just the culture and what the product has to offer.
Matt DeCoursey 10:01
When you say ownership, like there’s a military principle, Extreme Ownership, which says there are no bad teams, only bad leaders. Is that similar to what you’re referring to?
Jeff Havelka 10:10
Yeah, that’s spot on with that kind of camps approaches? So yeah. I will always be glad to have him on my side.
Matt DeCoursey 10:17
But I think that that’s a very important part of leadership. Because I don’t know, man, it’s easy to blame. And it’s easy to have a culture of blame. And that’s kind of what I was mentioning with that daisy chain if you didn’t do it, and it’s like, man, you know, like someone did it.
Jeff Havelka 10:36
Yeah, wear it a lot. Love it. So not only did Campbell do that from the military, just Amazon’s beast, and I’m glad I spent eight years there, but one of their leadership principles is ownership. And yeah, we tried to pull as much of the good stuff from our Amazon days and pour it into Beyond Warehousing, you know, doing the right thing. Efficient ownership, efficiency, efficiency. Yeah.
Matt DeCoursey 11:00
I never worked at Amazon. But as I’ve helped people build SSS and do a lot of stuff over the years, I’ve actually taken some of their principles that I’ve just observed as an observer. Are you talking about like steps, like the number of literal footsteps? Yes. Like I was working with one of our oldest clients that we build technology for, but they had, the thing we built for them has a component that operates in their store. And I was watching their employees Walk, walk crisscross across the right, you know, and I’m like, Well, no wonder this stuff’s piling up here. Because you have to take so many steps. And they’re like, Yeah, but it only takes a minute. I’m like, Yeah, but you do it faster than 47 times a day. And if you do the math on that, and this person’s making this amount, and they’re like, well, that’s still not this much. Okay, well, that’s your pain. $74,000 a year, right? For people to walk circles around your store. If you just put something closer and, like Amazon’s, super precise they’ve been talking about. Roland was like that. So Japanese manufacturing was way ahead of a lot of stuff that you see now with the robot process, the right stuff. So at the Roland factory, they had like little bands that when you put your hand in it, it would register that you have one last bolt, one last screw, one last part. And then they had a little robot card that came around and had your refills for you.
Jeff Havelka 12:24
Yeah, the automation that Amazon’s kind of pushed in the industry
Matt DeCoursey 12:29
15 years ago at the Roland factory, and then I’ve seen videos of some of the other stuff. I’m like, wow, that’s a lot of things moving. They could crash into each other. Yeah, it’s an impressive dance to watch. For sure. Right. So okay, so you look at three PLs and, you know, so typically, what is like, what is your typical client? Like? Like, why are they choosing you? Or, like, what’s that? What’s for them? So do we have integrity? We have efficiency. There’s some of that, but we’re, they’re still used. But let me do the math. Do you still have 26,999? Competitors? Yeah, like, I mean, like, how do you grow and scale and continue to find people that want the value?
Jeff Havelka 13:10
Yeah, so kind of an ideal customer, right, is kind of your mid-sized company that overhead doesn’t invest in the warehouse of SDN, those people, managing those people, it doesn’t make sense for them, right? They’re just not at the scale that they can do that. So kind of that midsize company is kind of that ideal client, but why they choose us over some of our competitors is a start with just operational experience, but then is the technology we have around it. So having our warehouse management system, making sure that our customers can easily see and be transparent on, here’s what we shipped, here’s where your stuff is, here’s where your inventory is, being able to show that we can maintain that accuracy of inventory for them. We ship things out on time for them. We’re an extension of their business, and we know that we take it to heart if we reflect something that doesn’t look bad on us. For those that are, it looks better than that, which is better for your client. Yeah, it looks bad on the client. I mean, which, through association, kind of looks, Yeah, to your client. But yeah, yeah. So it looks bad to my client and to me, but they’re not the ones that are writing reviews on Google about it.
Matt DeCoursey 14:29
It’s a heartbreaking feeling. And like, and if you and for those of you listen, if you haven’t experienced that you like, you talk about. Okay, so I’ll use my role as an example. And like, you know, you make a sale to someone, they’re excited that it comes in, and then it comes in damaged or it’s late or whatever, and all that stuff like you can your business can do a perfect job and then it gets to the point where it’s either out of your hands or somewhat out of your hands, and they can leave you looking like clowns. Yeah. And guess what? Are your buyers gonna blame you?
Jeff Havelka 14:57
Yes, absolutely. Yeah. probably middle, there’s nothing that lets them know that Beyond Warehousing sits in the middle.
Matt DeCoursey 15:05
I would imagine the less visible you are. And the better. Yeah, yeah, shall we?
Jeff Havelka 15:12
I’m a big believer that it’s a good thing if I never get from my lines.
Matt DeCoursey 15:15
Same with mine, like, we only hear if there’s a problem. True. And you know, we serve as Full Scale services like 50 Different tech companies, which are kind of like yours, you know, and then you need to scale a team quickly, your business is growing quickly. And the reality is, 300,000 open tech jobs have been given to people to do the tech jobs. So how do you find the right people? But yeah, for us, our clients end up managing people that are on their team, and we check in with them because we want to. We also don’t want to hear from our clients after they’re already pissed if that were to come up. So there’s like, a healthy little balance between invisibility and like, maybe semi invisibility?
Jeff Havelka 15:51
Yeah, it’s good for us to have weekly or monthly check-ins, to make sure everything’s going well. Just so we can get in front of if there are any problems, make sure that we have that productive conversation. So we can get that on our list.
Matt DeCoursey 16:08
And you say, oh, tar car.
Jeff Havelka 16:12
For operational tactical after action review.
Matt DeCoursey 16:15
Okay, so called Otara for short, national tactical after action review.
Jeff Havelka 16:20
So something is two ways two ways I see. So something’s happened.
Matt DeCoursey 16:26
Let’s dig into what almost sounds like a I bet there’s a city name oh, tar, some, somewhere near Saudi Arabia or something like that. So if you’re listening from the Middle East, reach out and let me know for a fact less, there’s 194 countries, we have a harder time figuring out who we’re still missing. Okay. Yeah, it’s man. It’s amazing. I love it. So if my business partner Full Scale, Matt Watson was here he would, he would actually, I know what he’d say. It’s like, Dude, I love that I love boring businesses. And I’m not saying that. But it is your These are like the little things that grind the gears that like are so key, though, when it comes to the success and like, there’s so much Oh, man, if you’ve never been around, or worked near or experienced or witnessed a busy warehouse, it’s a there’s a lot. Now it’s common. I mean, there’s a lot you talk about that, like, how difficult is it to keep track of everything, because you talk about that, like that transparency? Well, one thing that will kill your sales talent, someone’s in stock and the collector money, and you have to go back and tell them it’s not right, because then you look like you’re full of shit, right? So I mean, what does that look like?
Jeff Havelka 17:33
And a big part of it is making sure that we have a good warehouse management system and partner on that. And so we’re very big on what we call double scan verification. So somebody comes in, scans the barcode, makes sure it’s the right thing, goes into the database and says, You received X, you’re supposed to know why. Gotta go back and check it again, right. And so each step of the process, we double check it each time before it goes out. Because that’s the best way for us to make sure that things are accurate. Because if it’s not talking about this earlier, if your inventory is inaccurate, that’s probably because then you’re trying to sell something that you can’t Yeah, or it goes the opposite way, or you thought you sold everything. And then we’re left. And it’s gonna be really hard to sell widgets or whatever. Yeah. So just making sure that we’ve got those good systems in place that we’ve got the good technology around it, that helps ensure that we just keep that accuracy there. And make sure that there’s visibility to our clients 24/7 visibility, and they can get on anytime. Some of them are just, they’re going to be more hands on, they want to dig into things, which I think is awesome. And some of them are like, guys go and do your thing. And just make sure things are at the end of the good things of the year. But as long as I’m having problems, I’m not gonna really spend a whole lot of time on you guys. I know that I can go into your system and look at things.
Matt DeCoursey 19:07
Once again with me today, I’ve got Jeff Havelka. He is the CEO of Beyond Warehousing, who is included in Startup Hustle 2023. Top Kansas City startups, he’s definitely an expert on the subject. Speaking of experts, finding expert software developers doesn’t have to be difficult, especially when you visit FullScale.io where you can build a software team quickly and affordably. Use the Full Scale platform to define your technical needs, and then see what available developers, testers, and leaders are ready to join your team. FullScale.io are kind of in the three PL business in some regards to talk about our platform as well, matching people up with the right things, but then there’s a management component. And that’s tricky, and that’s actually what I want to talk to you about because you got some cool quotes here that our production team laid out. You know, one of which is you know, talking about how you put people first, and actually starts with avoiding temporary labor, which allows you to invest in training and growth, incentivize high performance and continuous improvement. That isn’t a quote that I would expect to hear from someone employed at a warehouse. Yeah, yeah, that’s unique and different, right?
Jeff Havelka 20:19
It is what a lot of our competitors do. And that’s, that’s kind of one of those things that separates us, right. And we really tried to push that because bringing people in not only does it decrease and treat them well, not only does it decrease the costs associated with retraining and hiring and stuff like that. But we tried to really make it a place where we understand that we’re our, their, their, were their livelihood, we want them to be able to come to work, want to work there, tell their friends, when I need to hire someone. You know what Bob should come and work for us, too. We think that’s by paying them a living wage, giving really good benefits. just treating with respect, asking their opinions, understanding what challenges they’re having there, and, and just really trying to be servant leaders to him. I think people have the right to come into work and enjoy what they do every day. And what else is in a warehouse. It’s tough man.
Matt DeCoursey 21:15
That’s thankless work. Yeah. And a lot of days. And that’s why I think it’s important that everything you just said are really checkboxes that are on our core principles at my company as well. And you know, we had a 94% employee retention rate last year, which by 2022, people think I’m full of shit when I tell them that they’re like, You’re lying. I’m gonna, no, I’m not, you know, actually. And if you look at it, we actually had negative churn because we grew. Right. So I mean, we had 75 more employees at the end of the year than we had at the beginning of the year. And with that, the key to it is will I be 100? Hear from your people? Yeah, I do these like townhall things. I put out surveys, you know, and it’s kind of funny, because I’m known for answering all the questions no matter what. So I encourage that, but sometimes I’ll get an occasional one, like the funniest one was, Hey, Matt, do you drink? Want to get wasted? And I was like, you know, so like, I’ll still answer the funny ones. But, man, I, you know, so I refer to keeping your finger on the pulse of your business. And I think that if your company’s going to be big, and you told us before you recorded, you just took over a year, over 1 million square feet, right, growing really quickly. And the thing is, is these culture problems, if you let them grow at the rate at your rapidly growing company, that you’re going to rapidly have a culture problem. Yeah. And those are really hard to unwind. And you know, and if your people aren’t your people at your company are your biggest asset.
Jeff Havelka 22:42
Exactly. Yeah. And we’ve found in our pasts that it takes about twice as long to undo a bad culture than it probably took to make the bad cold. Yeah. So really want to stay on top of that we actually had discussions about this morning, just around our growth, and how do we make sure that replicating that great culture that we had in our first building as we go into a second building and a third building and a fourth building,
Matt DeCoursey 23:08
which by the way, makes that not? Just a little bit harder? Is it exponential? Because different locations? I know, that’s because I have to travel halfway around the world to go to the office. Yeah, literally on the opposite side of the planet. Yeah.
Jeff Havelka 23:23
So how do you keep the cool vibe that you have here? Out there? Yeah.
Matt DeCoursey 23:27
And, and, and that’s the, but that’s an issue. And then I’ll tell you what, like, so we’re all remote now. Because the company’s five year old pandemic was half of halfway through the timeline. We got really good at our end in office logistics. And then we had to get really good at remote logistics. And that’s why when it came back to like, hey, we could open up again, we’re like, yeah, we’re not doing that. We just spent two and a half years getting really good at being portfolio remote, but we built a management platform similar to, hey, look, if you can, if you can manage and keep track of productivity and be accountable for that stuff. Like, yeah, you know, it doesn’t have to be complex. Like in our platform, we have a simple thing that anybody that works at Full Scale, has a daily report, they fill out it takes five minutes. What do you do today? What are you doing tomorrow? Do you have any roadblocks, right? And that will go to managers, it will go to clients and like some of our clients like, actually, we didn’t have a problem with the daily reports coming. We had the fact that some of our clients teams grew so fast. They’re like, can you consolidate this? Because I guess 16 emails are like, yeah, we’ll get on that. But that’s simple bit of communication across multiple locations, or multiple countries, or our case, also multiple time zones, is really invaluable, because if you can’t see the people that you’re working with or for it sure does help to just give them some idea of what you’re dealing with right now.
Jeff Havelka 24:51
And that’s, we were talking before out there that just every three to six months, we’re hitting that new level of a company As we’re growing so fast, that we kind of have to recreate ourselves and figure out things like, where? Well, man communication works. When there’s eight of us sitting around the table. How do you change the communication as you’re in two buildings, three buildings, four buildings. And just being very mindful and purposeful around what you’re doing, and it has to become part of a pattern, has to become just part of your life. This is what we do to continue to push this and keep that culture going.
Matt DeCoursey 25:29
Yeah, and that’s and that constant state of reinvention, I think is important, because you don’t have everything figured out. None of us do. Now, some of us may be doing better and acting like we do. But we don’t. And so one of the most valuable things that someone said to me while recording is you have you ever heard you know what link tree is now so basically if you look at it, Link tree is a lengthy you could go to that is essentially like a link directory, okay? Yeah. Now, when Instagram came out and became popular, Instagram only lets you have one link in your profile. So the link tree really blew up. And they I mean, they have 10s of millions of users like huge companies cuz you’re gonna eat like football and the Startup Hustle podcast, Instagram, if you’re gonna only click one thing, I may give you an option of stuff. So with that, I have the CTO, Zack on here. And I asked him, I said, Well, what’s one of them? He had had a very impressive work history prior to being the CTO at Lemon Tree. And he said, he said, I asked him, What’s one? What’s the most valuable thing you’ve learned being around rapidly growing companies? And he said, coming to the realization that sometimes the people that got you from level zero to 10 aren’t the same people that will get you from level 11 to 5000. Right?
Jeff Havelka 26:54
Which stings a little bit. Yeah. Because he loves those people. Yes, they did.
Matt DeCoursey 26:56
And at the same time, like, it’s, it’s tough and entrepreneurships filled with tough reality. And sometimes that’s also reinvention of culture, and like a lot of different stuff. So, you know, so I’ll ask my favorite question. Yeah. So that’s a problem to solve. But what’s the biggest problem you’re trying to solve in your business right now?
Jeff Havelka 27:16
The biggest problem we’re trying to solve is, honestly, it’s just around how to scale effectively and in a responsible manner. It was a combination of how much did he take on? versus how much do you want to bring in revenue? versus how much do you want to hire to be able to scale up and it’s a balancing act between all and honestly, that’s the biggest challenge we’re running into right now. Feel like your operation does a great job servicing our customers. Our account management team does a great job making sure that our customers are good, but you know, it people are expensive, right? And there, isn’t it backbone to this and a lot of it is around how fast can you scale? The IT structure on that? How fast can you bring on new customers in a way that doesn’t leave a bad first impression. So I think, you know, we’ve grown quickly, I think there’s gonna be a call leveling off, but not quite as steep over the next year or so just so we can kind of recollect that and kind of refine our processes to make it so they are more scalable. So I can bring on 15 clients in a month, which I just can’t do right now, just because we’re still building out those processes, we’re still building out expertise on our team. But it’s definitely a challenge to have that responsible growth, I want more top line revenue, I want more. Even though at the same time, I gotta make sure that we do it in a way that serves our customers, and then it doesn’t cost me too much.
Matt DeCoursey 28:59
Your Business similar to mine is truly driven by people and in your case space, which is very difficult to scale. And that’s, that’s, you know, so scalability is that buzzword that’s around I hear people talking about how their business is scalable, and I’m like, is it because in a lot of cases in your case like you actually have physical space to put stuff and if it doesn’t exist, you can’t sell it unless you’re planning on using the sidewalk and and the fact of the matter is, we will go get more space. Okay, well, that takes time, it might take it there’s a lot of shit.
Jeff Havelka 29:31
There’s a lot of money you have to put in IT infrastructure. For me. I got my racking and I got to buy material handling equipment. Yep, it’s Yep. It’s not cheap to open a new building.
Matt DeCoursey 29:39
Oh, no, no, no. And that’s, well, that’s one of the things that actually did us a favor because it pushed us away from a real estate model because everybody used to come to work every day but our employees didn’t want to because in the Philippines, traffic is terrible. So people are spending over an hour each way on the way to work, but we had kind To build this expectation that people were in the same spot, all blah, blah, I was terrified we would productivity would drop or productivity actually shot up, because it’s totally logical as well. You get people that are two hours a day back. Oh, yeah. And also like, if you’re like, Hey, I gotta get on this bus, I gotta get home, I got to do this by this time or whatever. Well, you just shut the laptop, you may not work on it. And the thing is we look for really passionate people. So that also bothers them. It’s like an unsolved problem, right? No, you’re Yeah, there’s something.
Jeff Havelka 30:32
You got probably another hour other than now? Well, yeah.
Matt DeCoursey 30:35
And it’s not even expected. It’s a lot that they want to write. I didn’t say work more, but I was concerned about that. Really, I don’t know, you solve all these things with good communication. But yeah, the scalability for people driven things. And we were talking about that before we hit record, you know, in 2022, for a two to three month period, I had a waiting list for clients at Full Scale, which people kept telling me they’re like, Oh, dude, that’s great. I’m like, No, it’s fucking terrible. Like, what do you mean, you’re sold to capacity?
Jeff Havelka 31:10
I’m like, Yeah, I also have sales people, marketing people, a whole bunch of people that I mean, what, what are we gonna do? Yeah, they’re like, Oh, well, you can work on the next clients.
Matt DeCoursey 31:12
I’m like, it’s a little more complex than that. And you know, some of that and you talk about that. And I do want to say that it is okay to especially early and faster and companies to have a start stop mentality. Because you’re in, you’re doing the right thing by tapping the brakes because if the vehicle gets out of control, and goes off into the shoulder or does whatever, that’s a much worse scenario than feeling like you’re the old lady driver on the highway. That’s a great analogy on a bunch at Full Scale, we’ve had a lot of start stop moments and like some of that like at one point, so we had 100 employees after a year which is crazy and we were close to 200 after two years and then we kind of ran into the pandemic but you know, at one point of about a year and a half like we just told people okay, we’re gonna have to get back with Yeah, cuz if you know we want to do and dress some culture and leadership issues that we knew are going to take part because dude, you don’t know what you don’t know like and until and until a real crystal ball is invented and works and we can cuz that was another thing too. Like we ramped up a little bit we okay so here’s where you want to talk about a funny story about space i This is not funny it’s so fun painful. So three months before the pandemic anticipating growth and at that and so our office there was a floor available where our offices and we signed a five year lease on it and we’re beginning to outfit it and then the pandemic hat you will get to the five year point of that lease and ever have done business one day or one minute on that floor it will cost me over a million dollars and that was that’s hazy crystal ball stuff right there because you talk about like we knew we need it we’re like if we don’t get it we’re not going to grow and then we’re also looking if we don’t get it in this building we’re gonna have a whole nother issue because we get to go find it somewhere now big spaces are sometimes hard to find and warehouse might be a little different but when it comes to like office stuff because that can get wildly expensive some places and you know so yeah anyway the start stop thing it’s okay if people like your I’m really have the pandemic changed my whole outlook on a lot of it I I’m actually kind of a riverboat gambler as entrepreneur and allowed as take a lot of chances and try a lot of different weird shit. But I’ve also developed an appreciation for that conservative nature, like don’t move out of the place you’re in until you’ve seen all of that on Sundays. But yeah, be responsible because you have too much debt, too much burden too much of that. You get the wrong couple things that happen, like what did in 2020. And yeah, you can use the hose. There’s a lot of people out of business for that reason, we’re running the same thing with the recession coming here, like supply chains change.
Jeff Havelka 34:02
There’s a lot of inventory just sitting there right now. Yeah. And I, along with most of my customers, hope that their inventory comes down in the coming years because retailers start buying things, again, higher quantities, and consumers start buying more. So I also don’t want to scale too much and have a bunch of space sitting open because now the economy is moving at a faster speed again, and companies are able to hold less inventory at that point and turn it faster. They do that and I’ve got a whole bunch of space just sitting empty.
Matt DeCoursey 34:45
We’ll never get it right Jeff. Yeah, we just do that. I’ve come to the conclusion that we just have to make a decision. And on some levels, people it’s a scientific as your fucking hope for the best. I mean, that’s kind of the true Yep, absolutely now like, but also like, I do want to key that important part because I mean, overall, I’m not like a super conservative dude when it comes to like, I’m very aggressive with my business and my growth, but at the same time, there are things that can sink the ship, right? Sure. Those are the things we want to avoid. Now, as a quick reminder, if you need to hire software engineers, testers, or laters Full Scale can help we have the people, the platform and the process to help you build and manage a team of experts. Go to FullScale.io You need to answer a few questions. Let our platform match you up with our fully vetted, highly experienced team of software engineers, testers and leaders. At Full Scale, we specialize in building long term teams that work only for you to learn more when you visit FullScale.io. Alright, so here we are at the end of it. And once again, congrats on making our list. Thank you. Congrats on being on the show. Like here locally. I think there’s a lot of people that consider being a Startup Hustle guest a rite of passage.
Jeff Havelka 35:57
Yeah, it’s awesome. I was really glad. And so is my team when we, yeah, we got the notification.
Matt DeCoursey 36:01
So and that’s an acknowledgement. You know, there was it’s we talked about lists earlier and less or funky. So, you know, I won this award from Forbes a couple years ago, and I pulled up at the bank, and I was trying to shove it in that little tube at the drive thru and it wouldn’t fit in there, like come in the lobby and try to shove it under the window there. Mr. De Courcey. You can not deposit this award in the bank. And I was like, Oh, you’re right. That didn’t really happen. But it’s a good story. Yeah, it’s, well, the importance is like, you create your success in your business and like, so I love acknowledgement, but at the same time, a lot of people are frustrated about it sometimes because lists are weird. Yeah, yeah. I Yeah. I, it’s, I’ve won awards for major places, and then I can’t win them locally, because all my employees are in the Philippines center.
Jeff Havelka 36:50
Aisle table, don’t like to take whatever list you wherever you go, there you go.
Matt DeCoursey 36:52
We’ll put you on. On all the lists. Congratulations, Jeff, you’re on all the lists. You know, it’s a funny thing I really learned about a lot of these lists is so many of them. Like you get that met. Like you’ll get the Hey, you’re on the list. And then you’re like, cool, and then they reply, like, for $7,000. We’ll be able to complete your lesson and you’re like, fuck you.
Jeff Havelka 37:16
Yeah, I get those all the time. Oh, my God. I’ve been recognized as a top 10 warehouse in the country. Yeah, yes. For $5,000.
Matt DeCoursey 37:23
Yeah, or more. Yeah, I got one. I keep getting one that keeps asking me to be on a PBS documentary. Yeah, except they want $28,000 to produce it. I’m like, get the fuck out. But it’s with Dennis Quaid. I’m like who knows who that is? Care. All right. So here we are at the end of the show. Thanks for joining me, me. I enjoy it. I like supply chain logistics. When I do that, I usually did the top startups list with Lauren Conaway. And she always makes me talk about the ones that deal with supply chain logistics. I mean, she does a great job over there. She does. Yes, Lawrence is awesome and dynamic. That doesn’t like talking about supply chain logistics. Now speaking to talking, it’s time for the founders freestyle, where I give my guests that our founding team members an opportunity to have the mic. Yeah. Are you going to use that time, Jeff?
Jeff Havelka 38:16
I wish I had a poem or some cool rap lyrics.
Matt DeCoursey 38:20
But instead of warranting further, I would have gone back to my 90s lyrics or something. You can do that.
Jeff Havelka 38:24
A couple things that I just wanted to come back and rehash. We’re talking about putting people first. I think that’s super important. You know, things that I forgot to mention on that is we really, as part of taking care of our people, we can definitely people that have struggles, we’ve got a kind of a fund that through various things that aren’t necessarily business structures are part of the business that reflects and then when people have a need that we can tap into that it’s Christmas presents, or I can’t get to work because the car broke, car’s broken. Let me help you out here. And I think that’s important. I think it creates some loyalty there. But yeah, I appreciate you having me on the show. It’s a big honor for us, and yeah, thanks, man. Well, thanks for having me, BeyondWarehousing.com.
Matt DeCoursey 39:24
You know, you mentioned the importance of people first, and I think that’s key. We do something similar or Full Scale. We have a fund that we actually hadn’t created, and then a huge typhoon hit at the end of 20. So we came into 2020 two weeks before a devastating typhoon hit the city where most of our employees are, and we had people we had to buy. You had to spring into action in a hurry. We had to relocate six families because they’re like have no roof and a lot, and I mean we and we did it can Uh, like an like, and that was heartbreaking. It happened right before Christmas, which didn’t really help the whole vibe, right? You know, it’s like shit, but I got it, you know, like, and we did that. I’m a big believer in giving without expectation of return. The reality is that it created a whole lot of goodwill in the company because they saw that our employees saw that it wasn’t all about us, right? And, you know, for those of you listening, don’t underestimate how important that is. Because no one wants to feel like a cog in the machine. Want to be heard. They want to be respected. And realistically, like one of the things so we’ve built this amazing brand in the Philippines. Do you know why? Because it’s fucking cool to work in our company. Right? We have clubs and do different things. We haven’t created a hump, a company holiday called outreach day where you get paid to come to do a full day of one of like 10 to 12 really well sponsored, community outreach events where we planted like 1000s of trees, we cleaned up a mile and beach last year, we adopted an eagle Eagle. I didn’t even know that until they told me we got to name it. Yeah. And I was like, Oh, wow. So yeah, so what would you name it? Well, I let the employees pick a name. And then I picked one. So C sharp is a coding language like C, you know, hashtags pronounced C#. So that overwhelmingly one amongst them, we have a lot of C-sharp developers. I kind of underestimated that. And then, I had to come up with my version. So I didn’t even do it grammatically correctly. So Poe is, sir. And the Philippines and guapo. Similar to Spanish, it means handsome. I was like, Dude, that’s Po Guapo. Man. It was a very majestic bird. I learned later it should be quavo. So I showed how ignorant I was, but C sharp won in a landslide. And we had a big company party. Nice. Last year, you talked about that. They’re like we flew people in from different places and got everyone into it. It was expensive. It required a lot of work. Very happy to have done it. Because it was fun. It was cool. Like, yeah, we did a theme they did. They did a house of codes. So it was like a game of thrones kind of thing. But you know, based on that, and hey, look, if you have a fun place to work, where people aren’t like terrified or like regretfully, coming in again, where they should have been yesterday. They keep people around. And I really think that that is like a key. If not, the key component will do. If you get away from that reputation. Management’s terrible. Yeah, like, trust me, even the least technical people know how to Google your company. And they’ll figure it out and it’s just hard to overcome that stuff. So do the right thing. People and your business will be able to grow fast. Jeff, I’ll catch up with you down the road.
Jeff Havelka 42:49