Podcast: The Secrets of Elite DTC Brand CEOs
Episode Summary
In this episode of the Free to Grow CFO podcast, Jon Blair and KC Holiday discuss the challenges and strategies for scaling DTC brands, focusing on the importance of overcoming burnout, implementing effective systems, and the value of mentorship. KC shares his entrepreneurial journey, insights on the different types of burnout DTC CEOs face, and frameworks for improving efficiency and decision-making. The conversation emphasizes the significance of community and storytelling in business, encouraging leaders to embrace their roles as culture builders.
Key Takeaways
Burnout can be categorized into upward, stagnant, and downward burnout.
Continuous improvement of systems is necessary as the business evolves.
Tenacity in initial problem-solving should be applied to all business areas. Scaling is fundamentally about removing constraints.
Decision-making should prioritize reversibility and impact.
Episode Links
Jon Blair - https://www.linkedin.com/in/jonathon-albert-blair/
KC Holiday- https://www.linkedin.com/in/kcholiday/
Free to Grow CFO - https://freetogrowcfo.com/
Daily Mentor - https://dailymentor.co/
Transcript
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00:00 Introduction
02:00 KC Holiday's Entrepreneurial Journey
06:00 Understanding Burnout in DTC CEOs
11:50 Frameworks for Overcoming Burnout
17:43 Building Effective Systems and Processes
23:51 The Importance of Focus and Prioritization
24:40 Removing Constraints for Business Growth
26:46 The Firefighter Analogy in Entrepreneurship
28:08 Decision Making and Reversibility
30:38 Forecasting Financial Outcomes
34:23 The Importance of Mission and Values
39:09 The Journey of Entrepreneurship and Community Support
41:07 Closing Thoughts
Jon Blair (00:00)
Yo yo, what's happening everyone? Welcome back to another episode of the Free to Grow CFO podcast where we dive deep into conversations about scaling a DTC brand with a profit-focused mindset. I'm your host, Jon Blair, founder of Free to Grow CFO. We are the go-to outsource finance and accounting firm for eight and nine figure DTC brands. And today I'm here with my buddy KC Holiday, CEO, coach and head of Daily Mentor. KC, what's happening man?
KC (00:26)
What's up man, thanks for having me on, appreciate it.
Jon Blair (00:28)
Yeah, thanks for joining me like first thing on your Monday because you're Pacific time, right? You're on the West Coast. you are. Nice, nice.
KC (00:34)
No, I'm actually East Coast now, so you're good. Yeah, yeah, yeah, yeah, yeah. So I'm in
Raleigh, North Carolina, so you're good. You got me at lunchtime, so I put down the sandwich and figured I'd spend some time with you. You're good.
Jon Blair (00:40)
Okay, perfect. Okay, there
we go, there we go, we go. Well, we're both from Orange County, I think. So, I think that's where I, I still got the 714 area code. don't, 949, dude. For sure, for sure. Well, dude, I appreciate you joining, man. I know it's a busy week. all sprinting towards, you know, probably taking some amount of time off for the holidays. So,
KC (00:47)
Yes.
man, I'm 949. So there's a little rivalry. think there's a little internal rivalry that exists between those area codes.
Jon Blair (01:07)
But look, what we're gonna talk about today is something that's super near and dear to my heart. know, KC's doing something that I think is incredibly cool. Like I mentioned, CEO coach runs a business called Daily Mentor. But what KC's all about, you know, from my research on his website is how to become an elite DTC brand CEO. But I would say for me, more importantly, how to beat burnout and create the systems you need to be energized.
and high performing as a leader. And so, if you follow any of my content, you know that even though I'm a DTC finance guy, I'm talking about this kind of stuff a lot, so I'm pumped for the conversation. Before we dive into that stuff, I'd love to hear a little bit about your background and your entrepreneurial journey to joining and being a part of Daily Mentor.
KC (02:00)
Absolutely, man, I'm happy to share. And again, appreciate you having me on. my journey in entrepreneurship started...
Gosh, it's humbling to say this, but about 15 years ago. And as you mentioned, I primarily work with DTC CEOs. I've worked with CEOs in other industries as well, but sometimes I think your experience is the first place you look in terms of how you can best help people. And when I was in my early 20s, about 23, 24, I was trying to be an actor in LA. As you can see, that didn't work out all too well. But I had a different path, and I started my first e-commerce brand called Qalo, Q-A-L-O. We were the creators of the silicone wedding and I started it a few months after marrying my wife, realizing that wearing a metal ring was a pain and decided to just launch my own brand, bootstrapped it, had absolutely no idea what I was doing.
But had a lot of great people around me that were able to serve as mentors and advisors for me and come in and help me in the early days. And so I started that company with a buddy of mine. Fast forward a few years, we were number 151 on the fastest growing companies, Inc. 500 list. We sold a, I think by the time I exited in 2019, we'd sold a couple hundred million dollars worth of these silicone rings, which still blows my mind. I know it blows other people's minds as well that it happened, but had an incredible group of people that we built it alongside.
So that was my initial venture into DTC. We were also an omnichannel brand. So we sold in about 4,000 retail locations on Amazon and Shopify as well. So I cut my teeth very much in that industry and growing that company and ran it until 2019 just before COVID, which was crazy timing in hindsight, but sold in early early 2020 like like November, December 2019, January 2020 is when we sold it, which is nuts. Yeah. And then COVID I think hit in March of 2020.
Jon Blair (03:35)
Yeah.
Crazy dude, right before. Yeah.
KC (03:45)
So my wife's Australian so after selling Qalo I stayed with the company for about a year to transition everything and then I ended up picking up and moving to Southwest Australia so Perth Which is where my wife's family is and so I was there for a couple of years and I had the opportunity to Help manage a corporate venture fund for a billion dollar insurance company out there Which was really interesting because my background was in that eComm space for you know the six or seven years and then all of a sudden you get into venture capital and not a lot of venture capital in Ecom, know, a lot of SaaS, FinTech type companies, DevTech, which is a thing, which is crazy. And so I had the opportunity to work with this fund. We had about, I think, 20 companies under investment at that point. It about a $40 million fund. And then we also had, which was really cool, an internal venture studio. So we actually had full-time employed entrepreneurs that were responsible for spinning up business ideas that were funded by the fund as well, that they were responsible for scaling. And my job there was to help coach and work with the founders of the portfolio and then also to help coach and mentor the entrepreneurs internally that were part of the venture studio that we were running. And through that I learned very much, one, about how a lot of other industries work, which is great. And I think it provided me a lot of well-rounded experience in my ability to coach CEOs. But also that I loved the idea of coaching and the idea of mentorship. And for me, think very much looking back at my early days, people advised me and came in in the early days because I was a dude that had no idea what I was doing and helped and so the idea now of paying it forward from just like, like a, a good thing to do perspective but also realizing there's a lot of stuff that I wish I would have known when I was a 24 year old founder of a eight figure company. In terms of systems and management and practical applications to scaling a company that now that I have, you know, 10 years of experience and I can look back, I can actually really help people and so.
unexpectedly my family moved back from Perth when COVID ended because we were locked down over there. And then I immediately went into CEO coaching. So I did that for about a year and then Daily Mentor started. And so Daily Mentor started just more than a year ago. So in about October of 2023. So I've been running that for now about the last year and that's primarily where I spend most of my time.
Jon Blair (06:00)
love it. When we first met, there's a lot of parallels to your background and my background in terms of like, I was on the founding team of Guardian Bikes. We started in the e-comm world in 2015, 2016, selling on Shopify and Amazon. And we had no idea what we were doing in the e-comm. I mean, like, we were just trying stuff and, you know, we...
Did we learn a lot and did we come away from that experience like having a lot to offer other e-comm founders and operators? 100 % but we are learning the lessons ourselves and so when it comes to coaching, I always like to say like a coach helps you go further faster because you can learn, you can skip the mistakes that the coach has made, right? The coach has made the painful mistakes and they're there to offer wisdom based on these real life mistakes and learnings that they've made.
KC (06:42)
Yep.
Jon Blair (06:52)
And ultimately when I started Free to Grow, it was, I wanted to pay it forward as well, right, that I had made all these mistakes for seven, eight years in eComm I was like, hey, but I know how to do this from a finance and accounting perspective, so let me start a fractional CFO shop that basically, you know, takes this playbook that I developed of scaling a brand from an operator standpoint on the finance and an operation side, and let me package it up and come alongside these founder CEOs who,
They're more visionary leaning, right? They're more marketing leaning. They're more product leaning. A lot of them are product leaning because like they found this gap in the marketplace that got them really excited, right? And they found this product to close that gap and really do good in the world. But they don't want to deal with the numbers and the, and the financial systems, right? Or I'm sure as you see the operational systems, that's not necessarily their forte, but this thing they started out of passion and ultimately all of like trying to create freedom for themselves, right?
KC (07:21)
Yeah.
That's it. Yep.
Jon Blair (07:48)
actually they become enslaved to after scaling to a certain size if they don't have those systems in place, right? And that's where I see a lot of burnout begin, right? And so from your perspective, what are some of the common reasons you see DTC CEOs get burnt out?
KC (08:06)
Yeah, and I think there's specifics to DTC because we live in this...
weird obsessive game with Facebook marketing or meta market. It's like we are so addicted to what this is because it's such a massive growth mechanism for our companies, for a lot of our brands it's the only growth mechanism that we have. And so we have this addictive codependent relationship with Facebook advertising. Where not all companies have that, right? Some people see it in different ways as well. But the way that I choose to classify Burnout, I actually put it into three different categories that is what's the cause of burnout for founders.
Jon Blair (08:14)
for sure. Yeah.
Totally.
KC (08:40)
a lot of people view burnout through this lens of mental health. And I think yes, I think that absolutely plays a role in it. But when you hear burnout talked about online, on social media, whatever, a lot of times it's people that are working for companies that are overworking. Or they're like, they aren't fulfilled in their work. And as a result of that, they're saying that they're burnout. Well, I think if you're actually the owner of the company or the entrepreneur, it's a bit different. So I categorize it in three different types. So there's upward burnout, there's stagnant burnout, and there's downward burnout. Okay, so upward burnout is actually an interesting one that a lot of people don't
But it's the sneakiest one and that is that things are actually working and they're working really well And as a result of it you are doing more and more and more and you're committing to more and more things So I draw the the parallel of that where it's like if you go to the gym and you start to see those abs poke through You're now at the gym twice a day three times a day four times a day because you're seeing something that's working and a lot of people externally would look and go That's what he it's working. Why is that? That's not burnout. That's that's not a bad thing It's like yeah, but you nobody in their right mind
Jon Blair (09:18)
Mm-hmm. Yep.
for sure.
KC (09:39)
should be working probably the amount of hours that that entrepreneur is working, but also what starts to happen there is they start to prioritize that thing over other areas of their life. And I think an undiversified soul or mind is one that leads to burnout in that way. And what I mean there is all of a sudden it's like a drug. Like that notification on your phone of Shopify...
Jon Blair (09:51)
Mm-hmm.
KC (10:00)
Boom, another sale, another sale, another sale, and you just pour yourself more into it. So that's one. The other is stagnant, and that is where things aren't going anywhere. You're kind of just, yesterday looks like today, you're pretty confident tomorrow's gonna look like today, you aren't really sure of where to go, things are kind of working, so they're not necessarily broken, but it's more languishing is where I would put that. And then there is the downward, and this is more of like turnaround type stuff. This is nothing's working, I'm doing everything I can,
Jon Blair (10:01)
Totally.
for sure.
KC (10:30)
revenue down is down 50 % this year than it was last year. Now all of a sudden I am trying to will my way to a successful company and as a result of that, that's when you start peep see people start diving in devices. You see people start, you know, looking for escapes in other places because they're just doing so much to make this thing work and it's not happening.
Jon Blair (10:50)
Yeah, I actually really appreciate that you classify burnout in those three different ways, because I actually believe that burnout is not a single thing either. it is, and it depends on a number of different things. Like actually, I was listening to a podcast recently, there's this guy named Jon Acuff, who has written a couple really interesting books, and he claims, he believes that...
KC (11:01)
Mm-mm. Mm-mm.
Jon Blair (11:17)
The vast majority of people who say that they're burned out are actually bored and they more have not found something fulfilling, right? And so they're actually not overworked. They're not working too many hours. They're underutilized and they're under leveraged, right? But I would venture to say just from my experience and, you know, our business in a different service comes alongside the same group of people that your business does, right? And what I tend to see as
KC (11:21)
Mm. 100%. 100%.
Yep. Yep.
total.
Jon Blair (11:46)
Probably be and we also specifically work with growing eComm brands, right? So we're working with a lot of brands that things are working. They're working well. They're growing. They're profitable and What we see burning out CEOs as they got into the business again They a lot of them had a product a love for a product and ultimately they had a love for the problem that the product solves that got them really energized, right? totally totally 100 %
KC (11:50)
You
Yep. Exactly. Yeah.
Yep. And even the customer too, right? Like, hey, I actually want to help people. This is cool.
Jon Blair (12:14)
And then as the business starts scaling, at first they're doing everything. Maybe they have an EA to help with some of the admin stuff or like a back office person, but they're doing the inventory ordering. They're overseeing the ad buying. They're overseeing the product development and it works. It's at the beginning. And then they start getting into eight figures and they're like, dude, I can't hold all this stuff down. And they've failed to systemize and delegate, right? And focus themselves and the work that they do every day.
KC (12:34)
Mm-mm.
Jon Blair (12:43)
in the areas where they can be in the intersection of passion and proficiency. That's how I think about it. How do you think about what is the framework or frameworks that you use to get these DTC CEOs who may be experiencing burnout as they scale? While they're successful from an outsider's perspective, what are some of the systems or frameworks you help them think through to get them focused on where they can really thrive within the business?
KC (13:12)
Yeah, the first place I start is with empathy, which by the way, I think is a drastically overused term in life, especially in business. But what I mean by that is...
I've been in a situation, and you mentioned earlier experience is the best teacher. I've been in a situation where genuinely I'm trying my hardest and I don't know what to do. Because I've never done it before. So I always try and start, and the first question I ask people on coaching calls when they're bringing problems to me and they're beating the crap out of themselves because they don't know how to solve it. It's like, how many times have you solved this problem before? Well, I never have. So then why would you expect to have the instructions to do it? Right? And so I think I start there with the recognition of like, hey, you're not bad for not knowing how to do this. You just don't know how. So that's ultimately why it is that we're here.
Jon Blair (13:33)
Totally.
For sure.
KC (13:52)
So I try and break it down.
I'll give you kind of like a high level and then if you want to go deeper into anything we can. Because it's actually I think a bit simpler than people want to give it credit for. So I break it down into people, process and systems. Right? Now those words are again all drastically overutilized. So people I think, let's go a little bit deeper there. So that is how do we get this person help? Now what a lot of people I think do is they, one they don't ultimately know who is out there to help them. They don't know what it is in their current tasks that they can actually get help with.
and they don't know if they should hire somebody for $10 an hour or somebody for $200,000 a year. And so the first thing that I try and do is I basically ask them to audit their time. So like, let's just, what are you spending all of your time on?
Jon Blair (14:30)
for sure.
KC (14:38)
And then basically go put a dollar sign next to whatever those tasks are. And if you believe that that is a high leverage, high value task, that it's going to be really expensive for you to replace, I want you to put a lot of dollar signs next to it. And if you feel like this is a task that you could get off of your plate, that is easy to teach somebody else, that you feel like this exists out there, then I want you to put one sign next to it. And then you can actually look at that and we try and figure out how you buy back your time one step at a time. So the idea about hiring a head of growth for a founder or a head of is a pretty daunting task. So I say, don't we just start with what feels like the easiest thing to do? Maybe we just get somebody to do your demand planning for you, or maybe we just get a bookkeeper in that can just reconcile your finances in a timely manner and give you some insight into the finances of the company. Would that be helpful? Absolutely. So I try and just start in the people side, which is ultimately like people build companies. That's what it is, and no founder's ever done it by himself. So we audit there and we actually look, okay, what's the first thing you can do to get something off of your plate so you can continue working on the most important things. think what I see a lot in Daily Mentor which is very odd but I guess in theory it makes sense is people try and hire for what they're really good at first. So they go okay let's say I'm an incredible growth marketer. I understand Facebook ads, I understand creative, I'm building 50 landing pages a day but I hate finance and I hate operations but they feel like
Jon Blair (15:50)
Mm.
KC (16:04)
Part of them becoming a CEO, so making this transition from founder to a CEO is, I'm supposed to be doing the boring stuff because that's what business school teaches me is running a business is, right? And so what they'll do is they'll go, I got to hire a head of growth so then I can start focusing on ops and I can start focusing on finance, which to be honest, if you had a CFO, they would probably tell you to get the hell out of their office because you have no business being in there, right? Like, but somehow they think, and so they spend all this time trying to find a head of growth so they can work on ops and
Jon Blair (16:27)
Yeah
KC (16:34)
They're really bad at ops and finance so they don't enjoy it and then they micromanage the head of growth because it's actually what they care most about and so I kind of look and I go let's identify what you don't like doing, what you're not good at in your own company and what is a low-cost task that you can delegate and let's start there. So that's the people side. The other then is the let's go to systems again another vague term so practically what do I mean by that?
So I look at systems as categorized in three different things. So one is frequency of meetings. Now that might be with an external agency that you utilize. So how frequently are meeting? What are we meeting about? And what's the objective within each of those meetings? So that's like a collaborative team environment. Then there's a communication system. And this is mainly like a remote work environment, which most people are operating within. So how are we communicating with external partners? How are we communicating with one another as a team? A tool like Slack is a perfect thing to insert into that there. And then the other is the project management tool. So I call that the mission control center, similar to the way that NASA has a mission control center and probably SpaceX does too. That when somebody is responsible for getting to the moon, it's all the sweaty people smoking cigarettes in that one room, stressed about it actually getting there. Like that's the mission control center for NASA, right? So I think you have a project management tool that represents that. Now within that tool is a combination of the goals that the company has, the objectives that it's focusing on in that moment.
Jon Blair (17:43)
Yeah.
KC (17:56)
all of the standard operating procedures for how everything gets done in the company and then all of the training manuals, all of the links to the external resources, everything lives in that sole place. So if you as a founder can actually start to build that onboarding people becomes a lot easier, right? Because now you're just dropping them into the Commission Control Center, they can look around and find whatever it is that they need to and you trust that they have ultimately what it is that they need. And so it's a combination of those three things allows you to optimize a lot of the systems that you're working with as a company and
And then beyond that, you can throw systems as like your tech stack. So like, what are you doing for, how are you doing bookkeeping? You are you a QuickBooks company? Are you a Xero company? Are you using A2X? Are you using Jon Blair? The world's greatest CFO, right? So, like, and then what are you doing if you have an attribution tool? How are you, all of this, the performance of the company lives within that. And then finally, it's the process. And process is just a fancy way of saying who's responsible for doing what in what amount of time.
And so I break that down as it's I just call it your areas of responsibility sheet and the simplest way to do that if you're an early stage CEO is Literally write down every single thing that gets done in the company every single thing go put the initials of the person next to it Who's responsible for it? There's two names in that box Somebody else could probably be doing something different if your names and all of those you have to figure out whose initials you can get in there and if nobody's initials are in there then it's probably something you should be doing or maybe it's a good thing that it is you're not doing that but it creates a lot of clarity and all the things that actually need to get done.
Jon Blair (19:25)
Yeah. So, so I, in a former world, I actually still do this a little bit on, on the side, but was an EOS coach and EOS was what we implemented at Guardian Bikes. This EOS is just for those of you who don't know, entrepreneurial operating system. It's, it's very similar. I mean, very similar, almost the same. just has, there's kind of their own way of doing it. And it's, you know, they've got, yeah, exactly. But, at the end of the day, these are the fundamental, this is the fundamental blocking and tackling.
KC (19:32)
There you go. Yep, as an example of it. Yep.
Like their own language. Yeah, absolutely.
Jon Blair (19:54)
right of scaling. Scaling is not just spending a bunch on ads and driving revenue through the roof. Is that a part of it? Yeah, that's a part of it, right? But scaling, really scaling is building a business, right? And a business means something that's bigger than the founder. And it's, and like, it is the, I would say just being the founder of Free to Grow CFO and then also working alongside eComm founders.
KC (19:54)
Mm. Yep.
Yes.
Jon Blair (20:23)
Deciding to start a business, right, yourself or even with a partner, and then scaling it and needing to build a business that is bigger than yourself is just about the hardest thing in the world you could choose to do besides having a bunch of kids. You know, which is another form, I think. I actually think there's a lot of parallels between having a family with a bunch of kids and scaling a business. That's for probably another episode, but it is not...
KC (20:36)
Yes, I would put children up there.
Jon Blair (20:51)
What is key, right? What I'll like kind of, you know, draw out in the stuff that you just went through. What's key is that there's more people than just you, right? There is intention behind deciding who does what and there's clear accountability. And if two people own something, zero people own something. One person can own something, right? There are gonna be two different people that own producing the same result.
KC (21:01)
Mm.
Yep.
Jon Blair (21:20)
right, for a different set of customers or products or whatever, but they don't both own each other's work. That's incredibly important. And then the other thing is there's a way we do things here, right? Process, system, there's a way that we at this brand do things. Now, here's where I see a lot of people get frozen and kind of paralyzed by fear.
KC (21:33)
Yep. Yep.
Jon Blair (21:46)
and not starting to do some of these things that KC's talking about. And next, I want to get your opinion on this, KC, but it's that they overcomplicate it and they think that they have to figure out all of those things in their entirety all at the same time, right? When in reality, actually these frameworks that KC just laid out, you'll be doing this for as long as you're running that business and they will keep evolving. You have to start and it's actually more of a discipline. It's more of a journey.
KC (21:51)
Yeah, go.
100%.
Jon Blair (22:13)
that you revisit these things and you tweak them on an ongoing basis as you continue to scale. And so you can't get locked up by going, I've gotta figure out all the people, all the processes and all the systems. No, all you need to do is figure out what's obvious to you right now. Because then eventually that'll break down or pieces of it will break down and then you'll need to evolve it to what's then obvious at that time. And you just need to never stop, right? And as long as you do that, you'll be ahead of the vast majority.
of other businesses out there who don't take the time to develop this discipline. Do you agree or disagree and what else do you have to add to that?
KC (22:49)
Yeah, I think you gotta eat what's on your plate. I say that all the time, it's like...scaling companies is about solving the next problem. You know, and I think if you're at, like I grew up going to Sizzler, right? Like if you're at Sizzler, like you look at the buffet, it's overwhelming, man. It's like there's hundred problems that live there and it's like that's the next 10 years of your company, but just start with a couple of things that are on that buffet and start there because if those are the largest constraints in the business right now, you have to prioritize solving that thing. And then the really cool thing is that you do it once, you...
Jon Blair (23:04)
Hahaha!
KC (23:22)
probably you're gonna make a few mistakes along the way, none of them are probably gonna destroy the company, and you're gonna learn how to do it, and you're gonna do it better the next time. And I think to your point is, it's really interesting because I think that there are, and I see this as different qualities in people, some people are better at it than others, but they figure out initially, they do whatever it takes in the beginning to make it work, and a lot of times that's growth, right? I can sell, I can run Facebook ads, I figure out how to sell this one product. But then they lose...
like the spirit that helped them solve that initial problem, when all of a sudden it extends to other areas of the business that makes it feel more real than just that thing. You know, and I'm like, I had a call with somebody this week and I'm like, guys, the same tenacity that you started the company with, you have to take that tenacity and now apply it to the other areas of the business that are the current constraints of the business. And I think perhaps it's easier said than done, but that's where I see a lot of it is people get in their own heads about over-complicating it or making it harder than it needs to be. Like all of the conversations
Jon Blair (23:55)
Mm.
for sure. Yep.
KC (24:20)
with founders and Daily Mentor that are like stressing about whether or not they should be giving a thousand dollar bonus or a fifteen hundred dollar bonus to someone and genuinely that the service is better than what I'm about to tell you right now but genuinely they go I don't care move on go do something else like that's not that you know that's not the thing in the business that's going to stop it from being successful but because it's new we get hung up on it a lot
Jon Blair (24:36)
for
Yeah.
Well, there's a couple of things you mentioned that I want to draw out. Scaling is about removal of constraints. That's incredibly important, right? Because there are, there's there's a numerable number of things you could solve or address in the business. But you as the founder, and especially CEO, if you're going to sit in the seat of CEO, you have to be able to say, this is our biggest constraint. I'm going to, I'm going to be laser focused on removing this.
KC (24:47)
Yep.
Jon Blair (25:09)
And I'm going to allow by saying yes to being laser focused on that, you're saying no to a thousand other things, but you're saying no to things that are not as important as removing that constraint. And I will say as the founder of my own business and having scaled previous businesses before, I would say personally, that's the hardest thing is because at the beginning you do have to handle all those non-important things at the same time. Right. But as you grow,
The opportunity cost of you addressing something that is not the constraint, right? At the expense of not removing the constraint, the opportunity cost is ever increasing as you continue to scale. And the reality is what I've started to realize, and I actually personally believe this is actually more of a, this is more of a universal truth in life, not just in scaling a business. I think that everywhere in life,
KC (25:47)
Mm.
Yep. Yep.
Jon Blair (26:04)
You need to, what one of my previous pastors used to say is major in the majors. Don't major in the minors, right? And that meaning, focus your time wherever it is vocationally, family-wise, managing your health and fitness. Focus on the constraint. Focus on the important thing. Focus on the real thing of valuable and let all the minors, let them be out of hand.
KC (26:09)
Yep.
Jon Blair (26:28)
Let them be messy. Let them be unmanaged. Because if you waste your time trying to manage those minor things, you will die not managing the major things, which are the things that actually matter.
KC (26:29)
Yep. Yeah.
Yeah, yeah.
But yeah, businesses go away because people solve the wrong problems. That's why they do. Like it's not often because nobody's doing anything. It's often because people are doing the wrong things. And I think one thing that I want to highlight too as well because this is a new reality that I think is uncomfortable for a lot of people. And you touched on it earlier of like, you're going to keep this business doesn't necessarily have an end date to it. Like you're doing this thing and it's going to go as long as you want it to.
Jon Blair (26:46)
for sure.
for sure.
KC (27:03)
What people do in the, like if you use the analogy of a fire, if you're a firefighter as a CEO, and that's the analogy that's used a lot of times, it's your job is to determine what the largest fire is and to go put that fire out. But I think what, and this is the challenge of entrepreneurship, I think, is it doesn't mean that the small fires go out. They keep burning. You have to be okay with them still burning, right? Like it's like you're looking at your house and you're going.
Jon Blair (27:22)
For sure. Yeah. Yeah, exactly.
KC (27:27)
Okay, could save this room, I could save that room, I could save the umbrella by the pool. Like, we gotta let that thing burn, man. Like, let's let that thing go for the sake of saving this thing and stopping this from burning. But there are fires all around you. And I think that's where people get very distracted is they go, I want to put all of the fires out. And you can't. You have to be okay with some burning.
Jon Blair (27:42)
100%.
Well, okay, so here's another concept that I want to talk about related to decision making that your bonus example made me think of. So I listened to a interview that someone had with Jeff Bezos a number of years ago, and he talked about the importance of decision making and the reversibility of decision making. And he was like, look, the CEO should make very few decisions in the business. The CEO...
KC (28:08)
Yep. Yep.
Jon Blair (28:16)
Most, he goes, I would even venture to say that most decisions in a business, whether it's made by the CEO or not, just shouldn't even be made, right? Or the ones, and then I would go to say that the vast majority of decisions that do need to be made don't even need to be thought about. They need to just be made and then you need to move on. The ones that need to be poured over are the ones that have the biggest potential impact and the smallest chance of or ability to reverse them. If it's hard to reverse something and there's a big impact of it,
KC (28:42)
Yep. Yep.
Jon Blair (28:46)
then you should, he said, pull more data and analyze it one more time, right? But, so this has been really helpful for me with scaling and even advising some of my CFO clients with scaling. like, hey, okay, well how reversible is that decision? So let's take the example of hiring someone. I've actually used this many, many times. Hey, we wanna hire a head of growth, right? Like, gonna pay them 15K a month. Like, I'm really nervous that they're...
you know, if they don't do their job, they're going to put us out of business. go, wait, but hold on. If they wouldn't weren't doing their job, would we let them go? Or would we just pay them 15 K a month forever? And I go, and furthermore, can we clearly define what their goal is? Right. And how much time they have to achieve it. And can we make it very clear and measurable? And so can we say, Hey, you have 90 days to increase our contribution margin dollars per month by 20%.
And if that's not working, we have to have another conversation. So what's your max downside? 45K. Your max 15K times three. Will 45K put us out of business? No, we can reverse this quick enough that it won't put us out of business. So reversibility is very important to consider in, the impact of the decision. What are your thoughts on that? And like what kind of other decision making principles do you advise your, you know,
your people on it Daily Mentor.
KC (30:11)
Yeah, look, I think that's spot on. I think the gap where... And one thing I want to be very careful of is not to... Because we have experience doing it, not to oversimplify it for people that are also watching this that may not believe these things are as simple as we're trying to make them to be. Honestly, that's part of why Daily Mentor exists. It's because we sit here and we go, yeah, just choose the largest constraint. The problem is people go, I don't know what the largest constraint is. I don't have experience with these 10 different constraints.
Jon Blair (30:27)
for sure.
Totally.
KC (30:38)
So,
and a lot of it is the capacity to be able to predict the outcome of each of those constraints going away or continuing to exist. So this, and this goes to right up your alley. So.
The reason I think people struggle to make that decision in your example, and I literally have a video on my social media talking about that exact thing of like, three months in, if it costs you 10 grand a month, it's a $30,000 decision. You spent 30 grand in your ad account last week. And you didn't even think about it on a bunch of ads that don't work at a .7 ROAS. Right? So let's not try, let's hold these things with equal weight, because the dollars are equal weight, because ultimately it's about how we're investing those dollars. But I think that...
Jon Blair (31:07)
For sure. Yeah.
KC (31:16)
If you're looking at this decision, what people fail to do is they fail to forecast the impact financially to the company. Like, there are a lot of people in Daily Mentor, and these are brands, guys, that are seven, eight-figure brands. These are not first-time entrepreneurs in every case. They're not people that have never sold a thing. These are people that are really successful, really sharp people. And I jump on, and it's like, okay, well, hire them as head of growth example. 15 grand.
That's 45 grand. Okay, so have you forecasted what the future of this company looks like from a budget's perspective with that amount of spend as an OPEX against what revenue is coming in the next three months? No, I don't have any of that stuff. And I'll give you another example. There's a guy that is thinking about...
restructuring his manufacturing to either continuing to do it as it is, which is a really quick turnaround but not as high quality of product process versus injecting versus investing in a bunch of tooling. That's going to be a really expensive decision. And the first thing I said to him was map out both scenarios financially.
Jon Blair (32:14)
Mm. Yep.
KC (32:22)
And then based on that, and to your point, I think there's other things. There's reversible decisions, irreversible ones. There's, is this going to lead to differentiation or not? Is there IP associated with like, there's a lot of intangible assets that come along with that as well that I think you have to take into account, but.
The first scenario in a lot of these is map out the financial outcome of what's going to happen. And if you're comfortable with the risk of losing that money or placing that bet, then go ahead and move forward with it. But if you don't have that scenario, if you and your mind haven't played out what could happen, then I think it's really hard to make decisions. And so that's one of the first pieces of advice I have is create the scenarios.
Jon Blair (32:58)
Well, and you know, so that's funny that you mentioned placing bets. People ask me all the time, like, well, what's the benefit of a fractional CFO for my scaling brand? I'm like, being able to place risk adjusted bets. And what does risk adjusted mean? One aspect, I think a very important aspect of risk adjustment is that there's not an unlimited downside. It's not gonna drain every dollar in the bank account and put us out of business, right? We're limiting our downside, just like a great
day trader, a day trader puts what? Stop limits on their trades. Meaning that they could be wrong in the wrong direction, but if they go in the wrong direction too far, they trip that stop limit, it sells their position and they lost money, but they didn't lose every dollar. It wasn't a zero sum game, right? And scaling is a game of removing constraints and placing risk adjusted bets. And here's the thing. Here's what we know. We know that our forecast is wrong. We don't know 100 % of what's going to happen. But the value in forecasting is if this happens, if A happens, this is what B looks like. If C happens, this is what D looks like. And if B, which I really don't want to happen, happens, this is what I would do. This is what I would do to live to fight another day, right? And so a CFO more helps you play out scenarios, right? They don't have a crystal ball.
KC (34:04)
That's it.
That's it.
Mm.
Jon Blair (34:23)
But that's the game, that's a big part of the game is scaling is, I know another word that is really like used like or phrase is used way too much, test and learn, iterate, right? Like, but it is, it's a series of iterations, right? It's just that every time you iterate, you're not gonna place such a big bet that it could put you out of business, right? And so there's another thing that I wanted to get your take on related to burnout, which is you talked about, you know, communication.
KC (34:34)
Yep.
Jon Blair (34:52)
and part of communication is how you communicate like, you know, the business's purpose and guiding principles and things like that. What is the importance from your perspective of things like mission, purpose, core values as it relates to keeping a business on track and also helping find that tenacity that you referred to earlier, right, to see it through the next constraint or the next problem that you need to overcome as you're scaling your business?
KC (35:22)
Yeah. I- I would classify those components, right? So the, you these cultural statements or these things that help shape ultimately, you know, how we behave, what it is we're trying to achieve, and how we define success. So if I asked you just in any environment, would defining success, knowing how we plan to achieve it, and having certain behaviors that make sense in order to go achieve it, would that make sense to you? Yeah, absolutely. It would make sense to you for a children's birthday party to have certain things, right? Certain desired outcomes, things like that.
Jon Blair (35:50)
for sure.
KC (35:51)
So I think people can and it's funny people have a very visceral reaction to an adverse reaction to a lot of these terms right because I think what's happened is there's a lot of consultants that have come in and said well you guys need a vision and a mission and values and that's gonna solve all your business problems and the guys like dude I haven't eaten in a week man like so take your vision and put it somewhere but I do think that it is critical because you have you are a
Jon Blair (36:10)
Yeah, yeah, exactly. Yeah.
KC (36:18)
culture builder as the leader of a company. Whether you like it or not, whether you want those phrases or not, you at least in your head have an idea of what success looks like for you in the future. You have an idea in your head about why you're showing up to work each day and ultimately what you're trying to achieve. And you also have an idea in your head of the type of people that you want to come work for you. That right there is the vision, the mission, and I call them principles or the values of the company.
Like that's it. So I think just like you're talking about, people tend to over complicate these things. They over glorify these terms. What it is, is a clear tribal like cultural guide for the people that are basically signing up for what it is that you're doing. Because in the early stages of a company, people don't come to work for the company, they come to work for you the leader.
They do. And I think a lot of people don't realize that. They go, no, my, you know, this like foot fungus product that I'm selling is so exciting. Like everybody wants to come. No, they don't. They want to come work with you because they think you're building a really cool thing and they want to be coached by you and led by you and developed by you. But they also want to know where the company's going because everybody in this life, life collectively, movies, social media, business building, brands, it's all about storytelling. Everybody.
Jon Blair (37:05)
Totally. Totally.
KC (37:33)
And everybody in their life wants to attach themselves to a story every single day. And so you're the author of it as the founder of the company and other people now are going, I want to be a part of that story. So in five years, I can look back and tell everybody what I got to be a part of. So then it's your job as leader to say, well, then in five years, this is where we're going and this is the story you'll get to tell. Why don't you come help me write it?
Jon Blair (37:48)
Totally.
KC (37:55)
And that's ultimately what it is. So to your point of all of those, think that they're overutilized in the early days of a company because I think people are just figuring out what the heck they're trying to do in the early days. But I do think that they're critical to do even before you bring people on because it helps allow people to attach themselves to the bigger story that's being written.
Jon Blair (37:57)
Totally.
We had, and me having like run EOS for like the better part of close to a decade, I think one, I always tell this to brands when I'm coaching them on EOS and we do this within our own business as well, Free to Grow, which is like, don't sweat it. Just write down what you think the purpose of your business is. Write down what you think your core values are and guess what? It's okay if they change, right?
This guy, Jon Acuff, I mentioned earlier, he likes to talk about like trialing a goal, right? Like he's like, dude, why do we have to be like stuck with a goal that we write and we realize a couple of weeks later, like this goal sucks, it needs to change. He's like, trial it. Yeah, right. Like there's no reason, like you have the freedom, like trial your core values, trial your mission, trial your purpose, right? And then as you continue to the business, it'll start to become clear and clear. And there'll be some things from your first draft that's stuck, right? And never go away.
KC (38:53)
It feels suffocating,
Jon Blair (39:09)
And there'll be some things that you're like, this needs to evolve, you know? And so like, anyways, like I would say in all of the stuff that we've talked about here, just get started, like just get started and take the pressure off yourself to like nail it perfectly. But additionally, you know, I mean, look what, what KC's doing over at, at Daily Mentor, like get a coach, you know, they, you know, the saying goes, like you can't read the label from inside the bottle, right? And, and
you're busy, you're running an e-comm brand, you're a freaking busy person, right? So like, coaches can help you slow down and reflect, right? And see outside of your day to day. And so like, get a coach and just start, and start to just love the journey of trying to get a little bit better every single day. Because at the end of the day, that's what compounds over the course of two, three, four, five, 10 years. It's like, I'm just gonna start.
KC (39:46)
Yeah, 100%.
Jon Blair (40:05)
using these disciplines and I'm just gonna never stop. And it's actually, at least in my experience, it's the paralysis of wanting perfection that keeps people from continuing to go and just being free and like, I'm just gonna try to work on the next thing, the next thing that needs to be done today, right? And that will compound over the course of a decade in much bigger ways than most people realize.
KC (40:30)
100 % man and I think to your point about the paralysis of keeping people People and this is what social media is created in the world is people especially founders believe that all the other brands in the world have it figured out I'm the only one that has no idea what I'm and so you're like in this scene like I look I see that brand on Instagram or I saw them in Nordstrom last week like they must they're perfect. They haven't all figured out They've never had any inventory issues. They've got a bunch of cash. I'm the only one in the world that's struggling
Jon Blair (40:43)
Yeah, for sure.
KC (40:57)
And it's just not true. And that's been one of the coolest things about starting Daily Mentor, which just for anybody listening, if you don't know what Daily Mentor is, so it's a mentorship community for brands that are on a trajectory to a million dollars or doing over a million dollars of revenue currently in the DDC space. And what we do is we combine the founders of these brands.
into what we use as our Slack community. into a community and then within that community you have direct access to over 20 experienced DTC mentors. So that's everything from retail expansion to we have four Google mentors in the community. our goal is that there's no problem in the world that a mentor within Daily Mentor can't help you solve. And it's for a monthly fee. also have the other, we have about 300 brands currently in the community.
So the reason that I brought this up is that you get to get within this community, and I've even had great exposure to this as well, is there's 300 other brands and you go, man, like everybody in here is just trying to figure it out. And some people are really good at those things and they're not very good at that and I'm really good at that so I can contribute to this person there. So not only do you get access to all these great mentors and experience people that have been there before you.
Jon Blair (41:53)
Yeah, for sure.
KC (42:04)
You also get access to other founders as well and you start to realize that collectively together we can all learn and grow and develop but nobody's got it figured out.
Jon Blair (42:13)
Yeah, man, I mean, we work with nine figure brands that from the outside, they're like considered DTC darlings and we know what's going on internally. And yeah, is there financial success in some of them? Sure. But guess what? They're trying to figure out how to remove the next constraint. And quite frankly, in many ways, the next constraint at nine figures is actually a lot harder to figure out than the one to figure out at seven or eight figures. like, and by the way, not to discount those, cause those ones are really hard too.
KC (42:20)
That's it.
That's it.
Jon Blair (42:42)
But what I'm saying is that it's not all fun and games at the top. It's actually in many ways even harder, right? And so look, man, I love what you guys are doing. The heart in it is like super, super awesome. I highly recommend anyone who is interested in learning about joining this community. Definitely check this out. mean, KC is full of just like a ton of knowledge, but so are the mentors in the community.
KC, before we land the plane here, where can people find a little bit more information about you and Daily Mentor?
KC (43:11)
Yeah.
Yeah, so I'll start with Daily Mentor. So if you just go to DailyMentor.co, spelled all the ways that you would expect, you can get to the website. And through that, can, if you're interested in joining through that, can book a call with a member of our team that can give you more information on the community, how it all works. Feel free to also send me an email. It's KC, just the two letters, KC@dailymentor.com.au. Davey is the original founder of Daily Mentor, is who I grew it with. And so we're in Australia, and we have some members that are in Australia.
Australia, some members here in the US, but that's why the .com.au email address. It's also a global community, which is awesome. you know, we're about, you know, about 30% Australia, 70% the rest of the world. So it's incredible getting to talk to other founders. If you're thinking about expanding internationally, you can talk to a founder that's in France that can help you navigate that landscape. So feel free to email me or if you want to send me any messages on social media, it's ITSKC, just the two letters KC, holiday on Twitter or TikTok or Instagram or any of the platforms.
Jon Blair (43:53)
Yeah.
KC (44:15)
So feel free to give me a follow there. That'd be awesome.
Jon Blair (44:18)
Awesome, awesome. Alright, final question. What's a little known fact about KC Holiday that people might find shocking or surprising?
KC (44:27)
when you, when you, when I saw in the sort of the, the lead up to this call today, I saw this question, nothing stressed me out more. I can talk to you about, I'll talk to you about inventory. I'll talk to you about all the things. And then it was like, what's something interesting about me? My gosh. I think a fun one, I've been on two game shows in my life. That's kind of fun. So I was on family feud with my family back in the day and yeah, dude. And.
Jon Blair (44:38)
You
Dude, heck yeah.
Dude, you were. I watched that show religiously
when I was a kid,
KC (44:51)
religiously growing up, right? So I was on that and we smashed and then I was the reason that we lost. I was the third...
Jon Blair (44:59)
Hahaha!
KC (45:00)
It still haunts me to this day. So you can see I'm getting emotional talking about it. Where it's like we were up 292 to nothing and then it was the final round and like if they steal at the end they basically they give them all the points. I don't know why it works that way. But anyway it does. And so the question was, which anybody listening might find this interesting, is what's a profession somebody would go into in order to become famous?
And I was a young, impressionable, I think I was about 17 or 18 at the time. So the answers I think were on the board were like a musician, an actor, and a chef or something like that, right? Whatever it was. we strike, strike, and the third one came to me. I think I said like painter or something and I got it wrong. And the other family stole it. And I'll give you guys three seconds to try and think about what you think it might be in your head. Do you have a guess for what it might be, Jon?
Jon Blair (45:52)
Yeah. What? You're talking about the top one? Like, yeah. Yeah. the fourth one. So you as actor, musician, what was the other one?
KC (45:53)
What do you think it is?
Yeah, so just one of them. we had three of the four. And with the fourth, there was four total answers. And the fourth one,
actor, musician, and I think it was, I think it might have been a chef or something like that was the other one.
Jon Blair (46:10)
honestly, the only thing that comes to mind is president.
KC (46:13)
my gosh, he was politician, that's what it was. That's what it was. Okay, so this is, like I was a kid, like, I thought that was public service, man. People are just, we just want to serve their community, isn't that what it is? And fast forward to today, don't... Yeah, right? Yeah, so I was a politician. So anyway, that was fun. And then I was on a $3 million game show pilot for ABC way back in the day. And won a bunch of money from my mom. So that was pretty cool. So that was fun. So those are some fun facts about me, yeah.
Jon Blair (46:15)
my gosh, dude, that's funny.
Yeah. I don't know if I would have gotten it though. I don't know if I would have got it though.
Dude, that's awesome.
Dude, that is super awesome. Most people haven't been on one game show, let alone two, so that's pretty rad. That's pretty rad.
KC (46:45)
Yeah, it was a phase of my life,
I think. I was in that LA vibe, know, so that's just what they think everybody in LA does. I guess I did some of it.
Jon Blair (46:53)
That's awesome man. Well look KC, I appreciate you taking time out of your busy schedule to come chat about this stuff. Again, this topic's near and dear to my heart. This is super important. Like, there's a lot of great things to take away from this. If any of it interests you, definitely reach out to KC. But I would say generally, just remember, it's all about getting started, loving the discipline, loving the journey, and then surrounding yourself with other like-minded people and mentors that can help you along the way because
The end of the day, we all have problems that we're gonna experience and face that we've never solved ourselves. So surrounding yourself with the right people is a massive unlock as you're scaling your brand. Also, don't forget, if you want more helpful tips on scaling a profit-focused DTC brand, you can consider following me, Jon Blair, on LinkedIn. And if you're interested in learning more about how our Free to Grow CFOs, DTC accountants, and fractional CFOs can help your brand increase profit and cash flows you scale, check us out at freetogrowcfo.com.
Until next time, scale on. Thanks for joining, KC.
KC (47:53)
Thanks, appreciate it.
