What Makes a Great CEO?

What Makes a Great CEO?

Sean: Question from Niño: In starting a business, do you want to bootstrap or receive funding?

I personally prefer bootstrapping. I have found that the best companies to fund or to ask fund for, are also bootstrapped companies. No one likes investing in a company that requires investment to live and grow. I don’t think that’s the case.

I think investors would invest in a company that has a good track record, that has been able to survive on its own when it was starting up, and that has a management or leadership team or a founding team that’s really really good. They know what they’re doing. They can survive and grow and move fast with a limited amount of resources.

Resourcefulness is more important than resources when you’re starting a business. Resourcefulness in tagalog is diskarte. That’s very, very important. In fact, even when you’re an employee and you’re playing for a team, having good resourcefulness or having good diskarte is very, very important. And investors also look at that in the founding team. Are they resourceful? Do they have diskarte? If none, then the investment will not be that great.

You would need to let go with a lot more equity to get more funding. So I’d say if you could bootstrap, always do it bootstrap, because that way you also learn everything. Literally, I would clean the toilet when I was starting out. You know those are jobs that I had for myself as an entrepreneur, because I didn’t have a janitor, I didn’t have someone who would be able to help me clean the office, so I cleaned it myself. I didn’t ask my employees back then to do it for me because that wasn’t their job. They could help out if they wanted, but apparently not a lot of them did so I would do it myself.

And what’s important is when you’re growing as a business and you’re growing as an entrepreneur if you quit those jobs. You have to quit being the janitor. Yeah, I have to quit being a writer. You know in SEO, you have a lot of writing going on. You have a lot of link building going on and marketing going on. So I quit all of the jobs that I wasn’t good at and stuck at.

Obviously I suck at keeping things clean and organized so I had to quit that early on. And for me to be able to quit these jobs and focus on what I’m really good at, which is sales and strategy, I had to grow the revenue. And thank God, one of the things that I’m really good at is making sales during that time. So as the sales grew and we got more revenue and I quit more jobs that I had within the company.

I quit being the janitor. I quit being an accountant. I quit being the legal adviser. And I hired an accounting team and I hired a legal team and they took on the job for me. So as you grow as a business, you, the founding entrepreneur, have to quit a lot of jobs that you’re not really good at. That’s what I did. That’s how we grew and I wouldn’t be able to do that if we were funded. I would only be able to do that if we were bootstrapped.

And because I was able to experience all of those things, I would say that I knew how to do those jobs well and I knew what losing looks like within that certain job. I knew that if the accounting balance sheet did not tally, that’s what losing looks like and that’s what a sucky accounting firm would look like for me. Right? So I’d fire them if that was the case.

But if you didn’t take on that job, how would you know what winning and losing looks like? You just don’t know. You’re just going to have to trust them that they have your best intentions at heart. And when you’re starting up that’s not always the case. In fact, even when you’re big enough, that is not always the case. So I would say bootstrap is still going to be the best way to go because you get to learn all of these little but important things and that’s going to keep your company afloat.

Because you, the owner who is investing your own blood, sweat and tears in the business, you get to protect your business from people who would steal from it. You know people would steal money from it. People would steal time. Time is also money. In fact, a lot of people say time is gold, meaning it’s more important than money and people would just steal that from you. People who steal time from you, those are also people who could steal money from you. Those are people who would not have your best interests at heart.

So for those of you who are starting your own businesses right now and you’re looking at some of your people and you’re saying you know they need a break, so they’re doing Facebook, they’re doing Twitter on company time, that’s fine. I want you to know that’s not fine because they’re stealing money from you unless it’s part of their job and what they’re doing is really part of their job. That’s not okay, because what they’re doing is stealing money from you and the company.

And if they could steal time and money from you, by wasting time on social media, I’d bet they’d still do more things given the chance. So you have to rethink your strategy in managing your employees if you’re allowing those things right now.

Hi Sir, may I ask when’s the best time to know that you need to hire people already?

The best time is number one, when you have the budget. I mean when you don’t have the budget, you can’t hire them because you’re going to lose money. So you have to make sure that you’ve got a budget. You have to make sure you have the money and you have that revenue coming in that’s going to be sustainable for you to pay them, pay for their salary, and their benefits, whatever. That one has to be checked for sure.

Number two, if you have a job that you must quit doing as your business grows. So I mentioned earlier that I had to quit being the janitor, I had to quit being the accountant, I had to quit being the legal team, I had to quit being the writer, I had to quit a lot of my jobs when I was starting out as a freelancer. And then focusing on leadership, focusing on sales, which are the things that I really need to do. Those are the things that I must do and only I can do them.

So when you get this realization that you have to go and do that and be the best you can be, be the best CEO you can be, be the best founder you can be and focus on things that you’re really good at, you’re going to want to start to hire people to fill up that gap where you’re weak at, and that you have to quit in. That can only be possible if you’re making more sales.

If you’re not making more sales, if you’re not closing more deals, if your revenue is not increasing, that’s not going to be possible for you. You’re always going to be working that job and you might not really like it, but you’ve got to do it. That’s because sales are not good and it’s not coming in. I hope I answered that question.

My business has six-figure net profit a month. Great! That’s really great for you. Glad that’s going on for you. Should I spend now on hiring people or on ads? By the way, I’m a huge fan.

Thank you! I’m glad that you’re here and this thing is helping you out. This is a work of love. You can help share the podcast. That’ll be amazing. Six-figure net profit a month? That’s not so bad. I think you should hire people. If it’s just about freeing up more of your time, at least definitely go hire someone.

I think I made six-figure net profit a month in my, I don’t know, second year of doing business. Yeah, probably somewhere, second year or third year of doing business. I think that you’ve got something really good going on for you here. Definitely hire those people who will help you be able to do work that you’re not really great at.

And I know. I have a lot of work I’m not really great at and I have people who are better than me. Right now at SEO Hacker, almost all of them are better than me in where we place them in the company, at what they do. And I’m only really good at what I’m doing, which is sales and leadership, and that’s it. So yeah, definitely do that. Get those people coming in.

Now, hiring is another thing altogether that you have to be good at, because you don’t want to hire just about anyone. You don’t want just about anyone to get into your house. And hiring is like that. You get them, you put them in your house and you tell them, “Here’s your KPI. Here’s what’s going to make me happy. Here’s what winning looks like for this job role that I’m giving you, and here are the keys to the house and I’m trusting you with it.”

So if you hire the wrong person, that house is going to burn. I have experienced that more times than I’d like to admit, and it’s not good. I wasn’t happy with those experiences. So I wrote about our hiring process – SEO Hacker’s hiring process- in a book called 50X Your Business.

That’s on Amazon right now and you can get it for the price of two Starbucks coffees. That’s how cheap it is. I’m not really thrilled about the price, but I am thrilled when I realize it is helping a lot of business owners grow their businesses right now. You might want to grab a copy of that and read the part, hiring and firing and building a great company culture. That’s going to help you out a ton.

I think that that is the last question. So that is it, guys! For those of you who are here for the first time, know that Leadership Stack Live is every Thursday at 8 PM and you can ask your questions on Discord. You could type in from.sean.si/discord, which is the rolling banner right there down below, and join the Discord community.

The questions are there, you can ask your questions there and we answer it every Thursday. Thank you so much for being with me tonight and I will see you guys next week.