Bigger Than Business
Guiding Leadership Principles For Times of Uncertainty (with Sunny Vanderbeck)
Jeff: Welcome to Bigger Than Business. Where you’ll discover real world stories of business owners living their purpose. This is the podcast for anyone who wants their success to be about more than just money. In these interviews, you’ll encounter men and women all over the world who draw strength and resilience from understanding why they do what they do and how they remain true to that purpose through the ups and downs that every business owner will eventually face. In each episode you’ll see your convictions can propel your actions in the marketplace. We’ll explore why success is grander, broader, and far more fulfilling when it is driven by a vision beyond oneself. Get ready to explore how your life can be bigger than business.
What are some of the most important guiding principles business leaders need to help their company not only survive a crisis, but to thrive and build a better business than existed before? How can you and your team make up for social distancing with emotional closeness? What the good leaders need to do to maintain the clarity of mind necessary to make good decisions.
Hello, I’m your host, Jeff Holler, founder and CEO of The Capital Chart Room. Sunny Vanderbeck is co-founder and managing partner of Satori Capital – a private equity firm in the Dallas/Fort Worth area, has been voted a Best Place to Work, and is known for its conscious capitalism culture and approach to business. Prior to co-founding Satori, Sunny built on the foundation of his former military experience as an Army Ranger, became one of the youngest CEO’s to lead a nasdaq company. Sunny is also the best-selling author of Selling Without Selling Out: How to Sell Your Business Without Selling Your Soul. Listen in as Sunny speaks about what conscious capitalism is, what kind of mindset it takes to weather a storm like COVID-19, the key lessons he has learned that will help leaders through today’s climate of uncertainty, and how it all starts with one simple concept: caring. I have with me today, safely, socially distance via zoom, Sunny Vanderbeck. Sunny is an investor, entrepreneur, best-selling author and former military leader, focused on accelerating the growth of mid-market companies and creating best-in-class, built-to-last businesses. Sunny is the co-founder of Satori Capital, a multi-strategy private equity investment firm founded on the principles of conscious capitalism. Satori acts as a true partner for its portfolio companies, as it challenges them to pursue extraordinary outcomes for all stakeholder groups. Before starting Satori, Sunny co-founded and was CEO of Data Return, a leading provider of managed services and utility computing. The company sustained 40% quarter-over-quarter growth for more than 3 years and reached 3 billion in market capitalization, making Sunny one of the youngest CEO’s ever to lead a nasdaq company. For more than a decade, Sunny led the company through all phases of growth and transformation, received numerous honors, including an “Entrepreneur of the Year” finalist designation from Ernst & Young, and nurtured a conscious culture for all the business’ stakeholders. Prior to founding Data Return, Sunny served as a section leader of the 2nd Battalion – 75th Ranger Regiment, and then started his business career leading technical teams at Microsoft. Sunny’s experiences with building, selling, buying back, and then re-selling Data Return, along with his subsequent involvement with dozens of private companies at Satori, has led Sunny to publish his first book – Selling Without Selling Out: How to Sell Your Business Without Selling Your Soul. It’s a real pleasure for me to have Sunny Vanderbeck on our podcast today. Welcome to Bigger Than Business podcast, Sunny.
Sunny: Thank you for having me.
Jeff: It’s great to have you here, and you know, Sunny the world has been turned upside down as a result of the COVID-19 pandemic. The owners of most privately-owned business are having to make difficult decisions regarding how to get their companies through this and remain strong, and ready to-grow again when the time comes. Other private companies are having to completely reinvent themselves. So, I want to frame the following questions from the perspective of how your experiences may be a benefit to our business owner listeners as they navigate these uncharted waters. First, and most importantly, how are you and your family doing? Is everybody healthy?
Sunny: Everybody’s healthy and happy and we’ve been able to spend a little time outside recently which has been wonderful.
Jeff: It’s kind of nice to get some time actually to get some concentrated and dedicated time together.
Jeff: So, what about Satori? How’s your company navigating?
Sunny: You know, I think we’re doing alright given the circumstance. And you know, in our case, we have both our company directly and then numerous companies where we’re a significant investor and so, one of the things we did very early on is we got the leadership team together to establish new cultural guiding principles. So we have ones that guide our actions day-to-day in normal times, and what we realized was that we needed some new guidelines. So, let me walk through those because I think they might be helpful in some way because they’ve helped us make decisions every day in the absence of lots of precise information.
Jeff: Yeah, no. That would be great. So these are guidelines for kind of like, the crisis management or the situation we’re in at this time?
Sunny: That’s right. Yeah, very specific to this particular situation.
Jeff: Okay, awesome.
Sunny: The first one is just One Satori. It’s a bit of a reminder that we’re all in this together and we need to watch out for each other. And so that translates into big things and little things like if people were working from home, making sure they have a good chair. And not just the leadership doing it, but every single member of the team watching out for each other.
The second one is Frequent and Authentic Communication. So, two realizations here:
1. in an environment like this, we need to communicate more; and
2. we are better served by having, I wouldn’t call it “less polished communications,” I would just call it “more real.” Let’s not spend 10 minutes finding the perfect word, let’s spend 10 seconds and speak from our heart when we’re speaking to each other.
The third one is Self-Care. The nature of our business, we have so many companies and investments to care for, the work is largely endless. We could all work all of our waking hours every day. And the most important thing we have right now is clarity of our mind; being able to make good decisions with limited information, to be able to connect with other people, and so forth. And so, this self-care can be very important. I’ll give you an example of how this has played out for me personally. My eating habits are pretty good, my workout habits are pretty good, but historically sleep has always been a challenge for me. I just don’t get as much sleep as I probably ought to get. I think I’ve had more nights of 7 or 8 hours of sleep in the past 2 months than I have I’ve had in, quite literally, the past 20 years, under the belief that a little more sleep will help me be a little more clear-headed, and be able to be a better thinker, and be able to better connect with people around me.
I’ll hit the last three briefly. The next one is Social Distancing and Emotional Closeness. So, on one hand, we need to keep some physical space between each other. On the other hand, we need to go out of our way to check in, go out of our way to be human, and be real. An example I shared with my team – I had the day that many of us have had along the way, where you’re just kind of done with all of this. Everything was fine, and just for a minute you go, “I don’t like this. I’m stuck at home. I’m doing x, y, z and I really don’t like it at all.” And, I would say historically I might not have shared that moment with the team, and I made the choice to share it, to say, “Look, this is real. We’re having these experiences. I had a pretty tough day yesterday, and I’m fine now.” In an effort to be closer to everybody else on the team, and let them know how I’m really doing, and where I am.
Last two: Facts Over Opinions. Particularly in an environment like this, it is difficult to tell what is a fact and what is an opinion, in any given day. And, frankly the experience along the way has supported this is well as what we think is a fact, 10 days later turned out to not be a fact, and so forth. It’s just a good reminder when we speak about something related to the illness, a medical situation, what’s going on in a business – let’s be very, very clear about what we know for sure and what might be true.
And then the final one is simply: Calm Amidst the Storm. A lot of stuff going on, a lot of healthcare outcomes, a lot of people sick and dying and one of the important things that we can pair with our clarity of thinking, is just to maintain calm, so that we can continue to move forward and make progress. And so, we feel like these guiding principles that were specific to this environment, at a big picture level, actually helped us navigate individual decisions we made along the way.
Jeff: Those are awesome guidelines. How has the team responded to those?
Sunny: I believe they’ve responded really well. In fact, one of things that’s become a part of our regular communication, we do zoom calls amongst different groups of the team, all the teams almost constantly. Trying to stay close to each other because we can’t have our hallway interactions, we don’t have our Monday meetings, and so on, and so forth. One of the topics there for every other call is: How has one of these values showed up in your life? How have you seen it in your day-to-day personal life or your day-to-day professional life? And so, that wasn’t something that I mandated or dictated or even suggested. It just emerged naturally in the conversation as we looked for a way to see these guiding principles or values in action. So, I believe they’ve been responded to pretty well by everybody.
Jeff: That’s awesome. It sounds like, as people get used to this type of communication, this type of self-care for example, is this something that once we get back to normal, you’re going to try and carry over and get more sleep, try and do better with that? Or are you going to try and maintain that frequent and authentic communication? I mean there’s some great guidelines in there for every day.
Sunny: You know, the funny thing is, some of these you look at and go, “Maybe I should’ve been doing that all along. And this is what forced it.” I think on the frequent communication, when we’re back in the office, I think we’ll appreciate more, you know, sometimes you have to go to these meetings, and your mindset is “Why? I can’t believe I have to go to this meeting.” And then you don’t have them and you realize, “Wow, I miss that meeting,” and I think we’ll have some of those experiences where we’re able to better appreciate our time together.
Jeff: Yeah, I think a lot of what we’re all learning through this, there’s a lot we’re going to carry with us. A lot of people I’ve talked to, a lot of our clients are doing some self-reflection and taking this extra time to look at things they might be able to do better as we come out of this, from a business perspective and from a personal perspective.
Sunny: Yeah, I think so. You know, the sleep, I kind of as you asked that question, I chuckled and took it as a challenge, and the best I have on the sleep is…we’ll see. It’s a bit of a struggle for me. I’m so curious about the world, whatever it is I’m looking at the moment just seems more interesting than sleep. But my hope is that, that one carries over.
Jeff: That may carry over from your days in the military, I would imagine.
Jeff: You didn’t get a whole lot of sleep back in the Ranger regiment.
Sunny: No, not so much.
Jeff: So, your life and your business experiences, they’re just so deep and so wide. I have to imagine they’ve been a great value to you as you help the Satori portfolio companies that you guys are invested in navigate this crisis. Beginning with your leadership experience, with the 2nd Battalion – 75th Ranger Regiment, progressing through kind each of your career phases at Microsoft, Data Return, and now Satori. Will you mind sharing some of the key lessons you learned along the way that are prominent in your leadership during this crisis? Clearly coming up with these guidelines is just great leadership, but do you mind sharing some of those key things you learned and what you’re applying today?
Sunny: Sure. I’ll start with a reminder – I don’t have all the answers. And, one of the ways this played out in our portfolio companies was really neat to see, was all these great leaders, CEO’s, that we have in our portfolio, find new and interesting ways to engage with their team that were appropriate for their situation. So, it wasn’t like we were calling them and telling them what to do, they largely knew what to do. There were occasionally places we could inspire them with new ideas, or new perspective, having been through some of these things before. But that was just really a blessing, to be able to see these portfolio leaders execute their own version of what needed to be done.
To your question, you know, I posted recently a 10-minute version of about a half hour talk I gave at a conference in 2017 called “The Next Bend” and I go through at great length, and I tell some fun military stories, and life stories. But here are the lessons, that as I step back to build this presentation in 2017, I had no idea it would be useful today, but it was one of those, I went and re-watched it because I sort of needed to hear myself say some stuff.
Jeff: Uh huh.
Sunny: And, here’s what came out of that reflection…
First, when it gets really, really hard, sometimes long-term planning isn’t useful. You hear people talking about, “well, visualize the outcome you want,” and that kind of stuff. I think when things are truly hard, that’s actually not useful; it’s disconnected from reality. When it gets very hard, to use the Ranger example, I’m not trying to figure out if I can get to the end. I’m just trying to figure out if I can make it to that log right over there. And if I can get there, let me see where I’m at, and how I’m doing when I get there. Oh, ok I made it there. I am going to get across the river. And you actually shorten your horizon down to – a business example might be when you’re in the midst of stress and chaos and all of these things, what is the next most important action I can take? What is it that I can do right now in this minute to make progress? And then you can extend it out a little further. What is it I can do today? What’s the one thing I can do today that will have the biggest impact? And don’t spend a lot of time worrying about what about 30 days from now, because what I’ve learned is that if you can make relentless progress, you might actually find yourself coming out the other side. But, it’s easy to get stuck if you look out too far, it becomes a bit overwhelming. I think that was really the point here, is you can get entirely overwhelmed by, “I’m 34 days into Ranger school, I only have 36 more days to go. I’m hungry and I’m hallucinating because I haven’t slept. How could I possibly make it that far?” You can’t think about that. “What can I do today that’s going to get me a little bit closer? Or, just what can I do in the next 5 minutes that’s going to get me closer?” And I’ve found that, the momentum of making little progress does have an effect on big progress over time. It’s a little like the people that are working on 10,000 steps. They’re not thinking about the 95th hundred step, “I just keep taking steps and sure enough they pile up.”
Here’s the second lesson I learned: second lesson was that you don’t have to go alone. When it gets hard, when it gets stressful, when there’s too many things going on, there’s lack of clarity in the world, and all these things, you don’t have to go alone. None of us are on an island. We all have people around us – our team, our families, our friends that will go on this journey with us, no matter how hard it is. And surprisingly, they’re there for you even when you don’t know they’re there. And I’ve got to learn about this, in the midst of some chaos that was going on earlier in my life. I just had a friend call me out of the blue, just to tell me, “Hey, I’m here for you. Anything you need, I’m here for you.” And that, little shot in the arm, that little reminder that I’m not actually by myself, while it feels like all of the weight is on me. There are people all around me, supporting me, want to see me successful, want to help out, and just as important, I am that person for a lot of other people too, it’s not just a one-way street. And so, the reminder of the friend that crossed your mind yesterday, pick up the phone and call them. See how they’re doing, check in on them. The team member that crossed your mind, pick up the phone and call them, check in on them, see how they’re doing. Be there for those people around you. And so, the second lesson of you do not have to go down this road alone was the other important lesson I learned. And by the way, if you would like to see the video, it’s on my LinkedIn page or on my website – sunnyvanderbeck.com. Go check it out, it’s about 10 minutes long. And you’ll get to hear some of the fun stories that informed this perspective.
Jeff: That’s awesome, thanks for sharing that. Those are two just phenomenal points, you know, I tell people, when we talk about things like this, the future is your imagination and the past is the past, part of your imagination too, how you remember it. The only things real, is the present. And like you said, focusing on the present, focusing on what you can do right now, to get to that log or cross the river. You know, is all that matters and that’s really where we get confidence, right? When you get to the log, your confidence grows. When you get across the river, your confidence grows. If you’re thinking about the remaining 36-37 days, it’s hard to build that confidence up. That’s such great advice. And you know, not going at it alone is also great advice. I think, the most successful business owners that I work with and who I’ve tried to emulate, surround themselves with great people. They’re collaborative, they know they can’t go at it alone. They know 2-3 minds are better than one, and they seek people of like minds that want to help, and can help them and look for it. And like you said, try and to do it for each other. Where people who struggle that I’ve seen in business and emotionally, are ones who feel like they have to do it on their own. They have to make, I don’t know if it’s pride or if it’s just ill-informed, but the folks like you that have that mindset that understand you know, the old and weakest chain, the chain is only as strong as the weakest link, and when everybody’s working together, it’s stronger. Thanks for sharing that. That’s such great insight. You know, in your book, which I’ve read, and found so informative, and again the name of the book is: Selling Without Selling Out: How to Sell Your Business Without Selling Your Soul, I’ve found it so insightful, I’ve given it to several clients and you state that your way of looking at business is closely tied to conscious capitalism. For those who might not be familiar with the term, do you mind just sharing briefly, what you mean by conscious capitalism.
Sunny: Sure, and I’m going to give you two ways that will help understand this.
One way, is to think about, you’re the largest employer in a small town. Your family names on the door and you’re never going to sell the company. How do you make decisions in that environment? And it goes like this – Well, you’re probably going to treat your employees pretty well, because they’re your neighbors, and you probably have a good relationship with your suppliers because you’ll see them at Dairy Queen in the morning on the way in. Probably not going to dump chemicals in the river, because your cousins farms’ downstream from your plant, and so on and so forth. And so, this belief that business is just an ATM, is just a thing that generates, only really exists to generate money, I think is extraordinarily short-sided. And I think it’s something only that’s come into play in the last 30-40 years. For lots of time before that, it meant more than that to the world. Here’s another way to think about this, profit is not a dirty word. Right, we’ve seen a lot of concerns about capitalism along the way and my suggestion would be that it’s sort of capitalism in its truest sense is really a beautiful thing because of all the value it creates in the world, and profit is just a reflection of value creation, if at least over the long term. So imagine for just a minute, if you have a company who is a Best Place To Work, and your suppliers love being partners with you and your customers get a lot of value from whatever it is you do for them, and so on and so forth. Your community loves to have you in the community, and so you’ve got this network of interdependent stakeholders that are all helping each other out, and you create a lot of value for all of them. Those companies tend to be pretty profitable.
The short version is, were the companies that are jam-packed full of happy customers and happy employees, and happy suppliers that are also economically successful. And so, paradox is, profit is just a trailing measure of value creation. Does the world need what you do? And are you creating value for other people? So, a way to think about this is, your familiar with the idea of karma.
What you do for others, you will get back. And so, what if business runs the same way? What if my focus is not on what I can get, but my focus is on what I can give. And by doing that, it turns out really great for the shareholders, that’s really the idea here.
Jeff: That’s an awesome explanation and an awesome example. Thank you for sharing that, it’s interesting. You probably don’t know that I know this, but I know when you talk about giving back, it’s not to your stakeholders, it’s in a lot of ways, and I bumped into your CFO, probably near the height of the meltdown in March, and we were just chatting and asked him what they’ve been doing, and you guys have just completed giving away, quite a significant amount of medical masks to the medical industry. It was quite a price tag, because that was something you guys felt you needed to do at that point in time. So, you guys practice what you preach in a lot of ways and I see it in your company, and I see it in your people. Tell me, for the business owner that’s listening, and he likes the idea of conscious capitalism, he wants to try and practice it. How’s it compatible and beneficial when all of a sudden when he/she is having to make difficult decisions like cutting overhead and staff in order to keep their company financially healthy. They’re in that small town and all of a sudden, they’ve got to furlough their neighbors, or maybe not buy as much from the supplier for awhile, you know, help our listeners understand how that is beneficial.
Sunny: Yeah, so, I’ll start with this – capitalism, or conscious capitalism is not about doing things from a place of guilt or feelings, or even a morale stance on business and what businesses should or shouldn’t do. It’s actually just more a nuanced understanding of what a business really is and how it works. Occasionally it gets thrown in the kinder, gentler capitalism, where everybody feels good about everything, and that’s not what it is at all. So, I’ll start with that little bit of distinction there. With that said, what does it mean when you deeply care about your employees and you have to furlough them? Well if you think about it from the inverse and you say, “what if I just, it hurts too bad to do that, I’m not going to furlough them.” What does that mean? Well, it may mean that your business doesn’t exist anymore. So, if choosing to not do that because it didn’t feel good, what you’re actually doing is prioritizing your own feelings over the livelihoods of the 500 other employees that weren’t getting furloughed. That doesn’t sound like a very conscious choice to me. To say, “well, I’m going to avoid how I feel about the situation but I’m going to put at risk, everybody else that wasn’t getting furloughed.” So, this is a bit about greater good. Right, if the company is gone forever, that is of no value to any of the stakeholders. So, you end up with some hard decisions about, “how do I press? Where do I press? What decisions do I make? Can I stretch a supplier?” Here’s an example – is it a good thing or a bad thing to stretch a supplier by another 2 weeks in order to conserve cash, so that you can lay off one less person. The answer is, I don’t know. It’s very specific to every business, but if the lens that you have for it is, I’m going to try to create the most value for the most stakeholders, and I am going to have some priority amongst the stakeholders, that’s an okay thing to do, the point is just to stop and think about it for a minute. Maybe that’s a great choice, and maybe stretching that supplier, puts a key business partnership at risk, and maybe has the potential to put them out of business, and now you’re in a bad spot as well. I don’t suggest any of these decisions are easy or that there’s a blueprint for “here’s how to do it” and it’s very specific to every business. I’m going to add one more thing – maybe you can start with actually caring. You actually care about your team, individually and collectively, and your other stakeholders, individually and collectively. I think you’ll make better decisions, but you also have to make them through the long-term lens and the short-term lens. I’ll give you an example of a decision one of our portfolio company leaders made. Revenue was down 50% or so, so they needed to make some decisions pretty quickly about, if it was going to stay like that, they couldn’t have as many people on the team as they had. It was just the reality of the situation and long story short, his first instinct was, “I’m going to do this right now” which is often a good instinct. Because the sooner that you do it, the more options you have later. But in this particular case, he said, “you know, here’s what this actually costs on a weekly basis” and it was all the way down to weekly, on a weekly basis, just get a little more information. And ultimately decided that he would rather do one round, not two if he could, which I think is good advice, so he decided to wait just a couple weeks. There were two data points that he needed to have a better prediction about long-term, how things were going to play out. So, he made a good cost benefit trade-off, of when we do this one time, I want to be able to keep as many people as I can keep, and I’ll have much more clarity two weeks from now, and so he decided to wait. I know my answer may seem a little long and rambly, it’s because it’s not an easy thing at all, and, if the enterprise doesn’t survive, you don’t have stakeholders anymore. So, we had some pretty simple rules that helped guide this.
Rule number one – don’t get anyone hurt.
Rule number two – make it to the other side.
Rule number three – seek opportunity.
Again back to these, if you can get some principles together, that can help you decide, you know what, we are going to open the plant but we’re going to make sure we can provide masks for everybody, do temperature checks on the way in, etc. etc. This is good for everybody, but let’s not create risks for our team. Rule number two – if you don’t make it to the other side, none of the rest of this matters so you have to make it to the other side. Rule number three – in the midst of all of this, there may well be an opportunity for a business industry. I’ve got a friend with a pretty large business with a couple thousand employees and he went to zero revenue. And I just, I feel so much for the people that have gone to zero, because you don’t really have much range of choices. But one thing he did in the midst of all of that, when he makes it through the other side, and I know him and he will, his business is completely reinvented. It gave him, well I wouldn’t say gave him, it forced the opportunity to re-examine all of these decisions along the way and rethink so many of the individual pieces of how his business was put together. In that case, it actually feels like opportunity. He has a different business coming out of this.
Jeff: Yeah, it’s interesting. Boy, you weren’t rambling at all Sunny. That was a phenomenal response and the examples you gave were tremendous and the complexity of those examples is what a lot of people are experiencing right now, and your comment about caring is a starting point. I think is the key, and caring not only about the people and the stakeholders, but the survivability in the long-term, financial health of the company. So, I’ve been asked the same question recently, or similar, and by clients about some tough decisions and very similar to what you said, I’ll say is, “first thing, just pause, just pause and assess. You can’t make a good decision without good information, you don’t want it to be an emotional decision.” You have to assess the situation, look at as many facts as you can, and like your example, Satori’s company that you need two more data points he needed. If you need to wait for those data points, get it, and then once you make a decision then you got to go for it, you have to pursue it. And, you know, there will be opportunities, you know I was talking to a client today that one part of his business, he’s got a number of different businesses, and one of them went to zero revenue, like your friend. And, he said, “you know, we have been talking about pivoting that business into a different industry. We had all the right resources, we had everything set up, we have just been hesitant to do it because we haven’t been making money over here” and he said, “so we pivoted, and we’re getting some interest, and we’re going to build a business over there” and he says, “when the other industry comes back, we’ll be prepared to jump back in there too and we’re going to be better off” so, you know, a lot of that again goes back to your comment about – focus on what you can do today and with the best information. Just great information, thank you for sharing that.
Tell our listeners who better understand your world, what types of companies and industries is Satori invested in?
Sunny: Some of our private equity business, we make both majority and minority investments in companies that are typically at least 5 million of annual profit and up to about 25 million of annual profit. One of the fun things about this job is how broad our sectors are. So, we have business services, consumer products, financial services, healthy food and beverage, specialty manufacturing, we have a little bit of all of it. So that’s been interesting to watch how the corona events are affecting each of these companies in different ways. And, what I have found is that as a CEO, if I have 10 problems, 9 of them are common to my size or situation, and 1 of them is specific to my industry, and I’ve found that to be pretty consistent across nearly every industry. An example might be – in the journey from 100 employees to 1,000 employees, the problems you’re going to face when you get to 300 employees are going to be the same across most industries. I’ll save the side bar of what those problems are, but they’re going to turn out to be about the same thing. Again, when you’re at 700 people, the business looks very different than at 300. More often than not, across industries, a manufacturer with 700 people, it’s going to wrestle with some of the same things a consumer products company wrestles with at 700 people. It’s much more about stage of life.
Jeff: That’s interesting. So, as you deal with your various portfolio companies and you’re advising each company, are you saying that depending on, the ones that have similar size and characteristics, you know what they’re all doing with 9 out of the 10 things they’re dealing with, the issues are going to be similar? You can apply similar guidelines to help advise them, and maybe one might be specifically innate to their company, am I understanding that correctly?
Sunny: Yeah, I would say that. And often, the unique thing to their business, the healthcare business as an example, these CEO’s are extraordinarily, deeply understanding that industry issue or we can help find somebody who does. So, I will give you a specific example to maybe bring it to light – our experiences been under 100 people, you as the leader and a few key lieutenants, can will your way into success. And, right about that hundredth person mark, the same pattern shows up over and over again. I learned about this pattern because I did it and it hurt, and I started to notice it elsewhere. That, somehow you’ll walk in and make a decision about, “hey, we need to do x, y, z” and it used to be, when you made a decision like that, it would happen, it would come to life, it would come into being, and now you find you’ve made a decision or tried to change direction or something and you circle back and check in on it 2 weeks later or 2 months later and it never happened. “What, I don’t understand. I was so clear about what needed to happen.” And, that used to work and now it doesn’t work. What in the world is going on? Well, about 100 people, your line in middle management comes very, very important to how work really happens in the organization, it’s less about your direct reports, and more about their reports, and about the line management. So often, the line level managers, and the managers-managers, found themselves in those roles because they were curious, bright, passionate, motivated, ethnical experts at the job they were doing before, and they stood out from their team and so they were promoted to lead the team, and the skills of leading a team and being the best individual contributor are very different skills. And so now all of a sudden, you’ve got a company filled with people who you’ve taken your best people out of doing the work, your most productive ones are no longer doing the work, and in many cases, they have no training or experience on how to lead people and so you’ve got this air gap between your direction and will and desire as a leader and what’s actually happening on the ground, day-in and day-out. And that, unless you know that’s coming, that happens to almost every company, where they get to that moment and they go, “why is it not working, why is it not working the way, this time last year.” It’s a symptom of, there’s only so many people a leadership team can personally engage with on a regular basis, to actually drive the company forward. And at a point, your middle and line managers actually become the place where work gets done.
Jeff: That is great insight. I imagine there are going to be some listeners whose companies have grown over 100 people, and they’re going, “that’s the problem! Thank you, I get it!” And, you are going to certainly help those approaching that level to address the problem before it happens. Hey Sunny, what’s the difference going to be in the companies that simply survive this economic and business upheaval versus the companies that will ultimately survive and thrive and grow?
Sunny: A couple things come to mind on that. Some of what I’m going to say is going to be almost opposite of the thing I just said. And I recognize that, and well it’s like welcome to being CEO, it’s a hard job because sometimes you have to hold opposing ideas in your head. The first one is pretty simple, it’s just this balance between pessimism and hope. Right now, only hope does not serve you well. Right, you’re not looking at the situation as it is now, you’re only seeing it as you want it to be. And that still is extraordinarily important as an entrepreneur, and it can be very dangerous in an environment like this. And at the same time, just pessimism, gets you nowhere. You say, “it’s never going to be better, everything’s terrible, etc.” On one hand, it’s not going to be like this forever, on the other hand we don’t actually know how long “not forever” really is. We’re all guessing.
Sunny: We’re just all guessing at how long it’s going to be before it’s not like this anymore. And so, the reminder of it is like this right not and depending on where you are in the country, you may still be in full shutdown and you’ve got to be able to deal with what’s really in front of you. It’s the balance of being able to do that and not lose hope for the future and make a decision that hurts right now that’s inconsistent with your hope for the future and know that you’ve got to be able to do it now. There’s a piece of this that as an example, one of the things that come out of this, is this calibration of the difference between seeking more information to make a better decision and making the risk/reward trade-off, there’s different than just postponing hard decisions because they hurt. The companies that postpone hard decisions because they hurt will likely have less resources than their competitors and so, as they come out of this, they’ll be just picking up the pieces and putting them back together. With that mindset of just doing the minimum you can so that when it is time to lean in and go faster and go harder, and to recognize that we’re in recovery, you got to be ready for when it’s time to go, let’s go, and at the same time, don’t expect to come out of your hurricane shelter in the basement and to see the neighborhood the way it was when you went in. There’s a bit of psychology about waiting for things to return to normal, which I don’t believe they will, and no one knows what the quote on quote “new normal” is. I’m not sure if I like that term. The hurricane basement analogy that I heard from someone worked much better for me. We all went into the basement and the hurricane blew over us and hopefully we come back out, we’re not just in the eye of it. But those of us that expect to see the world untouched, I think we’re fooling ourselves.
Jeff: I would agree.
Sunny: I had one other piece here. We’ve all heard this “time is money” thing, and that’s interesting but not terribly useful. And the thing that’s become apparent to me in this is that there’s an interchangeability right now between time and money and information. The more information I have about what’s coming, what’s changing, there’s a lot of value in that information, it lets me make better decisions, those better decisions either get me more money or more time. If I have more time, I can create more money, I wish I could draw for you all on the audio these things are very, very interrelated, that you can spend money or time to get information. A little bit like the story I talked about earlier, that CEO, that I’m deliberately spending $50,000 to get these two data points of information so that I can make a better decision. And in this environment, every 10 days the truth changes. And so, that being really calibrated on it’s time to make a decision, I’m going to do it now, I’m not going to delay, and it’s not yet time to make it. The last piece I would give for this one, would be – what does coming out of this mean for your psychology, for you as a leader, or as an owner? Are your hopes and dreams to just be able to put the pieces back together, and you just want it to go back to the way it was, or are your hopes and dreams that you’re going to find new opportunity and more growth and faster growth and you will build a better business than you had before, and your mindset of that is that of renewal and rejuvenation instead of just repair. I think that mindset will change the outcome for you.
Jeff: That is tremendous insight. And the examples you give and as you talk through the psychology and really the trade-offs that have to be considered, it just reminds me how challenging it is being a business owner. It looks easy from the outside, right? To see the success from the outside, they say “oh yeah, look at these people, they’re successful, they’re making all this money” but it’s incredibly complex, because you’re not just considering the financial aspects as you said of the company but you’re caring for your people and your clients and your suppliers and everybody that you interact with in the world and you want to do the right thing. It’s a challenge to do that, but you give great advice Sunny on how to do that, how to at least have the right mindset, the right process. A lot of it is, I think, is about process – taking the time to have a process to work through but ultimately you do have to decide and make decisions and then live with them. The one thing I’ve learned about making a decision is if it’s a wrong decision, I can correct it with another decision, but sitting there and not doing anything has never worked.
If one of our business owner listeners were to ask you today the most valuable advice that you could offer them, what would that be? You’ve given so much, I don’t know if there’s anything else there better than what you’ve already shared, but is there anything else that you would share?
Sunny: Yeah, you know there is. I was 28 years old, something like that, and I found myself running this pretty good sized company and then all of a sudden the world started to implode around me and we had the .com thing where about half of our customers just disintegrated overnight and it was pretty bleak out there and I had nothing to draw on, no experience with this situation. I had somebody on my board, who has been a great mentor to me over the years, a gentleman named Jody Grant, and I was talking to Jody about basically, “what do I do?” And, Jody tends to have pretty wise advice and in this particular case, here’s what he said, he said, “look Sunny, tomorrow morning when you’re getting ready for work, look in the mirror, you are the person that just got hired to deal with the current and future reality in this business. I want you to go into the day, with the mindset that it’s your first day on the job. Free yourself of everything that has happened before today, you just got hired, and it’s your job to deal with this situation, whatever it is. The decisions the old leader made, that don’t make sense anymore, that’s okay, that was the last guy, it wasn’t you. The decisions they didn’t make that need to be made right now, that’s okay, that’s your job. And so, this idea of reinventing yourself in a day, to this company that you may have been going in to lead for the past 3 or 5 or 50 years, and saying, “I just got hired, it’s my first day on the job and I’m going to walk in with that mindset, a clean slate and look at things as they really are and start making decisions, and not worry about what happened before and not worry about the why’s of before.” That was extraordinarily good advice for me. I think both in terms of what I was able to do next and to also free me from being stuck in the past. And stuck with some decision that I had made 3 weeks ago or 3 years ago or what have you, and so that advice has stuck with me for many, many years and I’m deeply appreciate of Jody because I think it changed the outcome for the company and certainly changed what my experience was like leading through crisis.
Jeff: Please thank Jody for me and for our listeners because that is tremendous advice. As you were sharing that, I was thinking through you know, how relevant, so relevant that is today, because it is like a new company, because we have a whole new set of circumstances and environment that we’re dealing in. So, that’s just tremendous advice, thanks for sharing that so much. Well, I’ve taken a lot of your time, it’s just been so great. Your insights, your examples, everything is just right on point on what I think our listeners need to hear and I think it’s going to help a lot of people Sunny, I really appreciate you taking the time to do that. But I do want to ask you one more question, and finally it’s the most important question I think, but you know, you’ve achieved a lot over the years and you’re still a young man at a young age, you’ve done so much. What has motivated you? What continues to motivate you to achieve such an outstanding success? What is bigger than business for Sunny Vanderbeck?
Sunny: I occasionally get asked why did I start Satori, or why did I start Data Return, the only answer I can really sit with and say that is the closest to reality that I can explain is this – I couldn’t help it. I woke up every day and it was just all I could think about, I could see the world a little bit different than it was today and I couldn’t unsee it. I couldn’t imagine a world where this business didn’t exist. The world needed it and I needed to bring it into the world. Historically for me, business isn’t actually about money. It’s about creation, and it’s about building, and about improvement, and so, if my view of business is that it’s not an ATM, it’s not a place to go to get money, but it’s actually a way to see the world a little bit more like I want to see it, I just can’t help it. The idea of what’s bigger than business here, is that business is bigger than business. You know the quote, “it’s just business” no, it’s a lot more than that. Business sets the tone and culture for all its employees. If people come to work, and they’re at a Best Place to Work and they feel motivated and fulfilled by the thing they spend the most of their waking hours doing, that’s a pretty big deal. If in its supply chain, it creates jobs downstream and other flourishing, thriving companies downstream, you think the worlds a little better off. And so, this idea that a capital lead business is bigger than the idea so just this thing and its commercial, and transaction, and all that. No, it’s a major influence on what it means to be human and what our experiences like with each other and the examples we can set for our teams about how to live in the world and who to be in the world. And so, I’ll close this with this idea of purpose, which I think also connects also to what’s “bigger than business” and the purpose at Satori is to create, fund and inspire businesses that elevate humanity. That’s what gets me out of bed.
Jeff: That’s awesome, awesome. Well, you know, I know you well enough and have spent enough time with you to know that you’ve really excelled at building, at creating, at business, at not just creating companies but creating cultures and creating opportunities and creating relationships, and you do have conscious capitalism, there’s no doubt in my mind, I’ve seen it and I appreciate it greatly. And I love Satori’s purpose and I can see it’s at the heart of everything you do. Well, Sunny thank you. Again, I’ve taken a little bit more time than normal because you know, your insights been so great, and it’s an important time and I think it’s going to be beneficial for our listeners. But thank you again for your time and for sharing such valuable insights for our listeners.
Sunny: Thanks so much for having me. I enjoyed the conversation.
Jeff: Thanks for tuning in to Bigger Than Business. To hear our latest episodes, be sure to subscribe on apple podcasts, google play, or your favorite podcast provider.
Do you know a successful business owner who you believe is achieving their purpose in life and want to recommend them for Jeff to interview? Please visit our website at thecapitalchartroom.com and let us know. And remember, in life, always create a vision for your success that is bigger than business.