Building and Scaling the Grace Eleyae Brand with Grace Eleyae Part 3
The Pros and Cons of Business Growth
Emmanuel: All right, welcome back to Journey to an Eight Figure E-commerce Business. We're back talking about how we grew our business, graceeleyae.com and scaled it the first couple of episodes we looked at getting started. Then last episode, we talked about the growth journey, you know, cause we 10X'd every year and going from $600,000 to $6 million in revenue. Good Lord, how we hit that. But this episode, we want to start off talking about our first million dollar month, and then that'll lead us into talking about the fact that that's not all it's cut out to be. And while there's some good, there's also some bad. And it really highlighted a lot of division within our own team, within our family, within our business, all kinds of different things. So we'll just start there, Grace. You remember what it was like when we finally were like, oh my gosh, this business is making a ton of money. Good Lord.
Grace: Yeah, no, I think that there was a, that November, I don't even know if, I think we were prepared for it because we had such a big boom from the, such a huge jump, I should say it wasn't a boom like that, but it was such a jump from I think May to June when we really discovered Facebook advertising and started really, really utilizing the right content for our audiences. So we had that huge jump. So we went into November kind of prepared with, at least with inventory, but I think not really expecting it to be so big that Black Friday. And so I think, yeah, it was just, it was a great, I mean, I think there was so much going on within the interpersonal that it was hard to see, but it was definitely us running, or I guess we're driving a race car and trying to change the tires at the same time. I remember going to the post office every single evening, sometimes twice, we learned, they almost learned our names. You know, they recognize us, we backed in the Ford Flex filled with bags of orders that we needed to ship out and it wasn't through the front, of course, we'd go to the loading dock in the back and we knew the post office at that point. Did we find that out at that point? Not to go to because they had lost like whole bags. I think there was one of the post offices nearby that would lose entire bags of inventory. But we basically were making constant runs because we were all shipping, everyone was shipping. At this point, I think we maybe had one employee that was helping us with customer service and it was just the family and we all, it was literally all hands on deck for, to make sure that we would get all the orders out within basically a week or so that we had. Yeah, it was crazy. Ha ha ha.
Emmanuel: It was crazy. It was wild. And for a lot of folks listening, you wonder, how do you go from, you know, doing a couple of thousand to doing a million bucks in a month? I remember it actually is pretty simple. It's not easy, but it's simple because you think about it. What's a million dollars worth of revenue, divide that by your average order value. And you can get how many orders you need. You can get how many units you need. You can get how many, you know, you can work the math backwards for every department in the business and in episode seven, eight, nine of podcast season one, I talked specifically about how to do that, but that's all it took. So it's like, all right, if I know I'm going to need $200,000 worth of inventory to make a million bucks at a 5X, you know, markup and okay, I need to get $20,000. If I'm going to, that represents X amount of orders that I need to ship. Then I need to be prepared with headcount to help me ship that amount of orders. If I know that it's going to cost me this much in ads, well, what's my return on ad spend? And I can look at that and say, all right, I'm making, you know, 10X ROAS or 5X ROAS or 4X ROAS okay, I need to spend 200 if it's four, I need to spend $250,000 on ads. And as long as I maintain that 4 ROAS I'm going to be able to scale to hitting, hitting on that, and I don't run out of inventory. And so it was like, Oh, uh, this works. And as we were scaling ad spend, it was happening. So we just made sure we had the inventory or we could at least go run and get it within a timely manner. And we made sure that the ads were still hitting that four. And surprisingly, we were shocked that we were able to do it. We hit a million bucks in one month. And to your point, it was stress trying to get, you know, when you're shipping, you know, you find out quickly that the postal service, yeah, if you're taking bags to them, they'll be like, why don't we just leave a truck at your warehouse? You just fill it up. We'll come pick it up later. There are certain things that happen when you become a high volume seller.
Grace: Yeah, yeah. Yep, you're right. They did start coming to pick up and they had to bring like a bigger car. And we still have that postal worker today who comes to pick up our goods. So yeah, it definitely, it leads to new, it leads to the need for new systems and the need for new processes. I think that's when we tested a 3PL. Was that in 2016? I think that might have... Was that 2016 or was that 2015?
Emmanuel: One of those years.
Grace: Yeah, one of those years. Whichever year it was, we were testing, we were also testing a 3PL, you know, and there's, we talked about quality control with, that you kind of lose, with every degree of separation, if you're going out overseas, et cetera, you're losing a level of quality control in manufacturing. It's the same thing with shipping. As soon as it leaves your warehouse and sitting in someone else's and they're shipping for you, you do lose a level of quality control when it comes to the actual shipping of the product. How it arrives, you don't have very much visibility on. And so there were a couple customers that got full, one customer in particular, this legendary story lives on, got a whole box of scrunchies when they ordered one scrunchie. I literally got a box of red scrunchies. I think it ended up being like a hundred scrunchies, you know. And so I think he even made like a little outfit with it, like put all of them on his arm and made a little outfit with it. And we like, just keep them honestly. At this point, what are you gonna do? And so we were dealing with a little bit of that and I think more money, more problems. Once the 3PL came in, we started seeing just huge shipping costs. The shipping and handling fees that we were paying to the shippers ended up being really high too. And that's another labor versus expense. Which one is better, I think in hindsight we probably would have shipped more from our own warehouse. We were still shipping too much, but we didn't have the capacity. We didn't have the labor to help us actually ship it out.
Emmanuel: Yeah, and this is one of those, the solution can sometimes be its own problem, right? So why do we get a third-party logistics? Because third-party logistics means that we don't have to do the logistics ourselves and we can scale. And that I highly recommend. I still stand by it. I think it's best, better to have a 3PL. Here's the downside though is you lose visibility, and in some senses you lose some control as well, because it's no longer right down the hallway or in your garage or in your own warehouse that you see your inventory. Now you're only looking through a website where there's an inventory count and that's about it, right? Where you can see, you log into the portal and maybe you're lucky and they give you a webcam into it. Not many do, but you don't get to see your inventory anymore. And so now you have to really be on top of them because they don't care about your inventory as much as you do. They never will, they can't. They have lots of different clients. They can't care about every single client's inventory as much as their own. So reasons why things like that happen is you start making, they start making mistakes like what you described about the red scrunchies, that's cases versus each's, right? So if you put a case as one unit, cause it's in one box, but actually they're supposed to open the box and each item inside is an each as a unit, that's what needs to be shipped, that mistake happens all the time, right? Another example is sometimes they'll start shipping something like a scrunchie instead of sending a first-class mail, they send a priority mail, right? These types of mistakes happen constantly. And so if you're gonna use a 3PL you absolutely must keep an eye on them. What was the payment quoted and verify every single unit, you can do this in Excel, what you paid, what you were supposed to pay for every single type of unit, what you were paying before, you have to be doing that at least weekly, or at least when you get every invoice and before you pay, or else these kinds of mistakes will just balloon out of control. I remember there was one year, we ended up having to fight them for $80,000 worth of overages that they charged us, that we were just paying $80,000 more. That's a huge hit to profitability, just from not watching what they were doing because we assumed they would do the right thing and they're humans they make mistakes, too.
Grace: I unfortunately, I don't have an opinion toward 3PL or not, but I do have more problems with 3PLs in that they're more likely to have overages than not. I've noticed that now that we've worked with more than three, is it four now? They're more likely to have those overages. Yeah.
Emmanuel: Absolutely. Yeah, because they're not going to try to, they're not going to try to optimize your cost. Like you would sit here and look at every shipment. If you have start selling, like we started selling hats with bigger boxes, they're just going to pick the box that goes in and ship it out to the postal service. Well, if they were in a two inch smaller box, instead of it being a $40 shipping cost, it could be a $12 shipping cost. Sometimes it's that dramatic, but they will never, let me not say never, but they don't care enough to make that adjustment for you,
Grace: They don't care enough.
Emmanuel: because that would require changing the product and why would they wanna have that conversation with you? But if it's in your warehouse, you would make that observation, like, whoa, we're spending 40 bucks shipping these things? They only cost 40 bucks, right? And that's what we're making is 40 bucks. So those kinds of things are what I mean by you lose some control. So that's why it's even more important to maintain visibility. But it's really a pick your poison. Because to me, if you don't use a 3PL and you keep it in house and you're trying to do a million dollar a month, that means you will be down there shipping.
Grace: Yes, true. Yes, that is true. Yes, true.
Emmanuel: We had many a day where we were sitting there for two straight days over the course of, I remember Thanksgiving weekend, eat some turkey and run back to the warehouse to work overnight, packaging and shipping. And then the next morning, you know, the boys, our nephews would come in and they have to work. And then mom and dad come in and then we hire help and temp and everyone's in the warehouse, just packaging instead of enjoying the turkey bowl and the rose bowl and Thanksgiving weekend. Why? So you pick your poison.
Grace: Literally, that is true. Or we had to, and that's true, we had to build into our employee handbook, other duties as assigned. Like, just FYI, you might have to ship on, yeah, you're a graphic designer, but we're gonna need you to wear comfortable shoes and you're gonna be standing, helping us to, you're right, like you said, it's pick your poison, but in general, these are all the things that kind of come along with that million dollar month and getting to the seven figures, there's a lot of growing pains that come with it. Shipping's a huge one, managing inventory is a huge one. Managing the cash afterward, another big one. You know, like, and how do we make sure that, how do you plan to plateau, as you said, so for a little while, you know, we always were like, grow, grow, grow and I've kind of that I can say that I've kind of conceded to this idea of like, sometimes you plan to stagnate so that, or I shouldn't say stagnant, but just stay at the same level. You're still moving forward, but you're just stay at the same level, so that you can catch your breath. You can make sure your systems are aligned for the next stage, essentially. And then, then you can look to go find funding and et cetera to, for growth, you know.
Emmanuel: Yeah, I think that's the most surprising part of our story to most people is that we just decided to stop growing. Sometimes intentionally, sometimes unintentionally. At first was unintentionally. Right. And what do I mean by unintentionally stopping growth? Well, we started growing and then the post office starts losing our bags or the 3PL can't keep up. Well, guess what? We can't order more and we can't, we have to shut down for a little while. That's unintentional stopping of growth. So we, we just had problems that we had to solve.
Emmanuel: Well, even once we had solved all those problems, we realized, wait, we're still not paying ourselves. How do we make a million dollars in a month and we still didn't pay the owners or we didn't pay the team, or we couldn't make payroll this month. We had to turn benefits off or we had to turn off ordering for inventory or we, cause we're out of cash. Well, because of what we talked about in the last episode, like in order to grow, you have to take more revenue than you made a lot of cases and to pay just for the growth, the extra purchasing. So what if you don't though? That was the clue to an intentional stoppages of growth. So wait a minute, what if we just stop growing for a while? Then guess what? What all we have to do is take the revenue that we made and just peel off the cost part that we had already paid before that we were used to paying and pay that again but the rest of that money we get to keep. That is powerful and people say that's taking profits off the table and it's stopping growth and whoa, what are you going to do? Yeah, the folks that are in that along in the game that have understand business, they don't care about hockey stick growth. They want incremental growth because they want to be able to pull cash out of their business, especially if you're bootstrapped and you don't have a big investor, you're basically financing this out of your own pocket. You don't have a big bank giving you a big loan or you don't have an equity investor just giving you cash and saying, I'll take a piece of the company. Stopping growth for a while allows you to actually pay yourself instead of putting all that cash back into hiring new employees, buying more inventory, funding more operations. And so that is the biggest surprise. And I will tell you, I had one client who was literally almost in tears, excited when she got that idea because she was in these mastermind groups and these entrepreneurship groups that were all like, grow, grow, grow, grow, grow, million dollar month, million dollar business. You got to get growth. And she was doing, you know, she was doing a healthy business, six, seven figures a year, uh, incrementally. And she was like, wait, but I need to be growing. She was a very successful doctor and she had, was paying $800,000 for inventory and to build her own manufacturing facility and her own 3PL and it was just like, why? Growth is a choice. She was like, what? I was like, you don't have to grow. Why? The only reason you would grow is to keep up with the Joneses and to impress other people, but you're not paying yourself. And just look at this huge team you have, look at all this investment, you're taking all your savings, pouring it in, why don't you just stop growing for a while? And then you can pull some of that money out of the business instead of pushing more in. And that blew her mind. And all of a sudden she was able to stay calm, slow things down, not hire as much, calm the business down and actually get more out of your business. Cause the worst feeling I see all the time is when people start a business, they get to be successful. Like we got to make it a seven million, a million dollar month and we were paying our business to stay open instead of it paying us. We were still getting loans. We were still in debt. We were still putting cash into the business, even though it was making a million dollars a month. You know, that just sucks. It just feels awful when that happens. So best thing to do is just stop growing. Stop it. Go in fact, go back. You made a million dollars this month, make a hundred thousand next month. That means you're not spending $200,000, $300,000 on ads. That means you're not pouring $400,000 in the inventory. That means you're not staffing up 20 more employees. You can just calm things down a bit.
Struggles and Advice for Family Business
Grace: It's true, and it is a choice. And honestly, part of the choice that we didn't see it as a choice at the time was the conflict that ensued as a result of growth. Because there's friction with growth, there's pain with growth, there's success and increase in resources does not create problems, it just reveals kind of the things that were already there and we probably had a lot of underlying things that hadn't been dealt with yet. And so how did we, how do you think, I feel like we had to deal with the familial things as well at the same time.
Emmanuel: Yeah, I'll give you. Yeah, I can give you mine and then I definitely want to hear your perspective on it because to me, I think it highlighted things that we just did not talk about right like most families do not work together. They definitely don't make money together and they definitely don't have, you know, their mother, their sister, their brother, you know, determining whether or not you're going to get paid or not, right? You being responsible for it and these are people who you grew up with, you know, there's very established relationships and now you're my boss? Hmm, I don't like that. Yeah. You know, so that brings bubbles up a lot of stuff. And I do think it's harmful, but it's helpful. Right? The statement we always use is the highs are high and the lows are lower. So when we win, like when we had that million dollar month, well, I don't have to go home and try to explain it to my family what happened. They get it already. They know, like they are fully involved. But the lows are also lower. The fact that, oh, we made all this money, but we're not gonna be able to pay payroll this year. And it's Christmas time, sorry, we have to pay our employees. That hurts even more, right? Or worse, when someone says something nasty to you at work, it's usually pretty, it's whatever. But someone says something nasty to you in their family, they know how to make it hurt. They know how to cut deep. So those are the things that to me really start to pop up in terms of when we look at the family and business side. But I'm curious for you, what do you think?
Grace: Yeah, similarly, I think that there was a lot of things unsaid. I think that there were things that were highlighted among that, you know, once you, once we're fighting over resources, like you said, it becomes we make value judgments on people's motives and desires and I think that then that cuts even deeper. And then like you said, it's not just that we have a family business. We have a family business that's a complete clash of so many cultures, even though we all grew up in the same house and have the same, you know, our mom is Kenyan, our dad is from Nigeria, we grew up in America, you were in the military. I was, you know, like we have all these things that really were coming together with completely different, you know, kind of not values, but like we just, we, I don't know that, like you said, most families don't work together and so they don't get an opportunity to see all their differences. There's going to be friction amongst people who work closely together, let alone the fact that people who grew up together, thinking that we all, I think we all thought in group think. And I wanna say what should have clued us into the fact that we probably shouldn't be, I think it was one of our mentors or coaches or whatever who said, so we've split up our shares evenly, equally between us and one of our mentors was like, that's not normally a sign, a good sign, basically. It's not a good sign of trust between the founders, essentially, because of, and he had his reasons and they made sense, and once we got into it, it's almost as if we didn't want to name who should have had more, who shouldn't, you know, and that's such a small thing, but it was like, it was so, it spoke to the fact that there was a lack of trust, you know, at the beginning, and that we weren't on the same page, we just, we kind of kept glossing over issues, you know, and glossing over things, and I think that once it came down to it, we had to define what we were in this for, and what we were, why we were doing this. And once we saw that everyone's why was probably completely different from each other's, it was like, oh, we are not completely on the same page on this one. And like you said, the dynamics of also being an African household, also, you know, no matter what having mom in the boardroom, or having, or the dynamic of, it's called Grace Eleyae, Inc, but you're my older brother. Like that's, and we're in an African household where age and seniority matters. That was difficult. I think that was hard to navigate and a lot of the conflict came from misinterpretations. And even though we all at our core, we knew that each other wanted the best. For some reason, it's like, if we don't have enough inventory, I took it personally, you know, like it's my fault and you guys are all looking at me and blaming me for not having enough inventory, not having, or this new product didn't work as well as we thought it would, and the marketing wasn't working. It was like, we were all taking things in the business that are 100% black and white. We started taking them personally as I feel, and maybe we were actually doing some personal attacks at the same time, but it's like, I feel like that, that meshing was really difficult and hard to navigate.
Emmanuel: Yeah. It's the same idea of like when people say my business is my baby, right? That we've meshed the business with our identity. Same with a family business, right? It's like if the business fails, I failed. If the business is a failure, I'm a failure. When that happens, it's hard to divorce the two and so then it's like, if anything is going bad on any day, it can control my emotions. It rules my sense of self, my sense of self-esteem. And then guess what? Now we add on the family dynamics of like, you know, you're supposed to be family, you're supposed to be trustworthy, I can't trust you. It's like, no, it's just a business. And like, people can fail a business all the time and then start another one and succeed. Right? Like let it be its own thing. And I don't think when, especially when you're in family and it's, and it's, and it's your identity and everyone's right at wrapped up in it, we've put everything into it. It can be like, no, there's no, we just can't fail. The pressure is so high that it even removes some of the risk taking, you know, it's just, it's just harder doing it that way.
Grace: Mm hmm. It's harder. Yeah. I mean, like you said, the highs are high. You know, we came up together. We all got our nice new cars. We all got nice new living situations. We all, you know, got to pay off debt. Like there's like the highs are high, you know, like we were winning together. And so I think that there's moments of like, whoa, you know, we did this thing. But the lows were just so low, you know, like some of the conflicts that we had, some of the late night conversations, some that had to be mediated by dad, or, you know, like things that had to happen to make sure that we, and somehow, honestly, I mean, this isn't like a don't ever start a family business.
Emmanuel: I tell people not to start a family business. I tell them all the time. Don't do it. I'll say it.
Grace: We still go to Thanksgiving dinner, you know, we still have Christmas, we still have good times, we still play games, you know, there's, it's not like we can't, it's just, I actually, part of me even is like, I don't say that because, only because if you guys can come with transparency and vulnerability and like you said, not attach your identity to the business, then, but maybe that's not possible. You're like, that's not a possible. I think that's possible. I think it's possible.
Emmanuel: Exactly, that's my point. That's a lofty, I think it's not possible. Because that's the way to solve it. If you can be as transparent with a family member as you would be with someone, a stranger you found off the street, then a family business could succeed. But I don't think we can.
Grace: But why can one be so transparent with a stranger found off the street? I don't know if I could be transparent with that person.
Emmanuel: Precisely because of that doubt you have in your voice right now like, Ooh, I don't know if I can trust you. So you're going to put in place protections. Why? Yeah. You're going to put protections in place. You're going to be watching them. You're going to be looking at them side eyed. Even if you turn your back a little bit, you're going to have a mirror up that you can look behind, right? Like you're going to have things in place and protect yourself. But when it's family, they could fly under the radar. And so then when, but this is what
Grace: I can trust the stranger. Yeah, oh, I see. Got it. Okay, but this is where I would just say, put in those protections. I have a whole list of things. I'm like, well, how would I advise someone, how would you, how would I advise someone who's starting, first let's start with you and then I can get to the things that I have.
Emmanuel: Yeah, I was gonna say, so did we put in those protections? Do we have them now? Exactly.
Grace: No, we didn't, we didn't know. But if I, but I wouldn't, I wouldn't, I wouldn't now put a complete, you know, blanket statement, do not set a family business, because I think that it's possible. But what are, what are your, what are your protections?
Emmanuel: Mm. Yes, yes. It's also like, to me it's also like, yeah, you can also be an astronaut. You can be president, anyone can be president. Yeah, anyone can. Yes, you're right. You're right. But no, and again.
Grace: Oh my gosh. But it's a little more than that. I mean, there's Johnson and Johnson. I don't know how the how the families are doing now. But like, there's still plenty of family businesses that are, you know, 100 years old plus. So I'm not.
Emmanuel: Yeah. And I love that argument, but however, if you compare the ones that did work to how many did not work, or even just to how many businesses there are like, well, why bother just go start your own business, do your own thing. And again, to your point, I'm not trying to discourage people from doing it. I'm just saying it's going to be much harder. You're playing a game that's really hard on even harder mode. Just making it super hard.
Grace: Mm-hmm. What would you do for someone who is starting a family business? And I wanna hear your things and I'll say what my things are.
Emmanuel: All right, so if you're going to start a family business, first of all, to your point, determine who's doing more of the work, because somebody will, it's going to happen, and then that's going to also change. So be prepared for how that's going to change as the roles morph, which again, is really tough because how do you predict the future? You can't, right? And then once you have determined that paper it up and say, based on the fact that you're doing like an employment contract, based on the fact that you're doing these things, this is what you're entitled to as a percentage of the ownership shares, right? And then make sure it's clear that no one else is entitled to it also because if someone gets married or someone is married or if someone dies, right, the estate is entitled to certain things, the spouse is entitled to certain things during the divorce settlement, all those kinds of things can be worked out. Definitely gotta have a lawyer involved just like you would for an employment contract if you're hiring employees. Make sure you have insurances in place if someone gets hurt or injured or incapacitated. Like what if your family member can't work? Most of us would not fire that family member, right? But, what are you just gonna keep paying them, right? Like now you gotta take care of them. So things like that need to be worked out. Think through all of that. There's just a whole lot more you gotta think through.
Grace: Yeah, I do agree with that.
Emmanuel: Yeah, yeah, if you noticed that I made it sound very hard, that's on purpose. I want it to sound hard because it really is. You have to think about all that stuff.
Grace: I didn't, I actually didn't think it sounded that hard. I was like, okay, so just paper it up. Ha ha ha.
Emmanuel: That's because you're like, oh, there's a castle. We can make it through the forest. Let's go. This'll be easy.
Grace: We can make it through the forest. For me, like, mine is more about the interpersonal. Like all of my advice for like working with family is like first is defining what you want out of this. There's a just like, and you're right, all of this is actually quite hard. It took, because you don't know yourself either. Right. There's no, there's no way that at the beginning of this business, I could have really truly named what I wanted out of it. Not really until I think it was like that third year when we were, year three when we were putting all of our whys on the board and I was like, oh, wow. But that was the first year that we actually asked the question. And then don't put a value judgment on the why of someone else. I think that was a huge thing, was us putting a value judgment on other people's whys. And then I also say the third party always helped. I think, like for the most part, like it just helped to have someone else in the meeting, even if it, even if they weren't that great in what they did, just having someone else there to be like, to just ask the question.
Emmanuel: That's true, a mediator.
Grace: Like I could ask you, you could say something, I say why, and you're like, I don't know, because, and then the same person next to me can be like, no Emmanuel but really why? And suddenly you open up or vice versa, like same thing. If you asked me and I'm you know, indignant mode, I might not say, have anything to say, but if some, just another person, a third party that's neutral, that's not taking sides, just there to kind of help guide the conversation, it really helps. And it's like, oh, and then suddenly I'm explaining, you know, yeah.
Emmanuel: I would not only would I agree with that I would co-sign that tremendously and say if you're gonna do it and if I was gonna soften on it I would definitely have a third party that both people trust that is a tiebreaker that literally has veto power that can be like I don't care what you guys decide if you come to me because you're arguing I will make the decision. Like if you have someone like that then in that case then it could work because there's so much pettiness that can out of nowhere show up,
Grace: Yeah, that's a good point. Ha ha ha.
Emmanuel: between two people that you lose sight of the forest from the trees to keep going with that analogy. You end up trying to win the battle and lose the war and lose sight of like, wait, what are we even arguing over? It really is like a marriage, like a relationship when you're doing this. So I would say that absolutely is critical. And then also to your point about not judging people's why, I think that also feeds into understanding people's boundaries. Right? Because people want different things in the business. Like for us, I don't think we really were able to mesh family and business until we fought through and made each other just like go our separate ways in our own way. So now, like, for example, for me, I'm running an agency now. I'm no longer a directly an employee of GE, but that was the boundary I needed to be able to work and now GE, Grace Eleyae is a client of mine and that relationship fits, it makes sense, right? And then our sister has another relationship, our mother has another relationship, and there's all these boundaries that have now been established, but it took five years of just strife and struggle interpersonal outside of like, yeah, we're making money, but like we're at each other's throats all the time to figure out, oh, if I'm gonna work with you, then I need this space, or I need that space, or I need this distance, or I need it to be this way. Exactly, right.
Grace: Yeah, yeah. Or yeah, I need you to not cross this line. You know, yeah. I know there are little things that I don't like to work on Sundays. Like I just, like you come and you talk to me about work, I'm literally, I glaze over. And I'm like, why are we talking about this right now? Like there's just little boundaries that like, you don't realize it until you start setting them. You're like, oh, I feel much more free that people are not, that my family, who I'm supposed to just be spending family time with, is not bugging me about, you know, the the ad, whatever, the inventory problem that we have. But you're right, boundaries really help.
Things to Consider
Grace: And I think that just to the point of us needing to define our whys even, I actually think everyone having their own mental health professional or coach or mentor is huge because we also need to be looking introspectively as well as allowing for other people's mistakes. It doesn't have to necessarily be a mental health professional, don't, you know, it could just be a friend who's in the same space that you can vent to and who understands what you're going through in some way or at least can give you some feedback because that was huge. And that took, you know, six years, five years for me to even get for myself, but it helped tremendously. I just was able to see things from a different perspective. And what I ended up using was actually an Enneagram coach who, or actually he was a psychologist who who moonlighted as Enneagram coach. So I was able to say, oh, but since your brother is this Enneagram type, this is how you approach him. Since Angel, since your sister is this Enneagram type, this is how you approach her. And this is how she received how you were approaching her. This is how your mom, and so on and so forth. And that was, that helped me so much in terms of interpersonal things, you know.
Emmanuel: Game changing. And it's so important, I do believe, especially when you start making money, because that's really when most of the problems show up. When you're young and scrappy, and nobody's making any money out of the business anyway, and working late. No one really cares about this kind of stuff. This stuff shows up later, when suddenly you have employees and there's cash in the bank account and now everyone's arguing over, we need to spend $300,000 on this. No, I need to fly to China. And I need to, that's when the problems really start adding up. That's when you need to really focus on the interpersonal. And I agree, it's so important that the business should budget it in. Coaches, therapists, those kind of things added to the benefits plan to allow, especially the founders who have the most pressure where you have the weight of the business on you, give each individual person their own person to help them, right? Interpersonally, mentally.
Grace: Yeah. Yes. 100%. It's so worth it.
Emmanuel: It is a cost that is so profoundly beneficial. It's absurd. Like you look at even major companies do this. Like CEOs have CEO coaches, right? Um, have therapists and actually another flip side of that each, each one of the owners and the senior team should have their own person they can talk to. Uh, you should also have them have their own assistant, their own VA, right? They, as soon as you start getting to where you're paying people six figures a year, it makes no sense to have them scheduling their own calendar. Uh, when, especially if you can get a calendly or something like that, it makes no sense to have them checking their email all day. Right? Because someone can do that and report back to them. The extra two hours a day that person gets is worth hundreds of dollars per day. Usually not just in what you pay them, but the decisions they could have made if they weren't sitting there checking their email and then you pay somebody a thousand, $2,000 a month to support them. You've just actually improved their productivity and improved the balance. So anyway, interpersonal stuff. Yeah. It's gonna be done. Yeah.
Grace: Exactly. Yes. Even just like filling out spreadsheets, like they should be doing that. They should be doing the analysis of the spreadsheet. You know, like, yeah, I get it. Yeah.
Emmanuel: Yep. These are experience. Take care of your people. That is it. That is what to me, once you get into doing seven figure months, that is what is crucial. Take care of not just your people, but your senior leaders. You have to protect them because your senior leaders take care of your junior leaders who take care of your team. And that's what you're really managing as a founder once you get to that stage is the people that take care of the people that take care of the folks that do the work to be able to do the work. Yeah.
Grace: Yeah, 100%. Yeah. And I think one other thing even getting to how we can take things personally that are 100% black and white business is I think I had to realize how much generalizations are emotional by nature. Generalizing things by generalizations, I mean like so much or so many. We had so many.
Emmanuel: Yeah, that all sucks. That's never gonna work.
Grace: That all sucks. Yeah, that doesn't work. And it's like, why doesn't it work? Well, because I just, you know, don't think it's gonna work. Okay, but why don't you know, and it's like, until we started getting specific. Because again, we talked about that example, I think in the last episode, where it's like, I, I think we should change. I came back after getting receiving some feedback, and I think we should change completely change the design of the slap. Why? Because we're getting so many complaints about XYZ, whoa, what's so many? You know, well, like 25. Okay, how many orders did we do last week? 5,000, oh my gosh. Why are we, why are we, you know, or it might even be the opposite.
Emmanuel: Yeah, and it's emotional.
Grace: You need to, yeah, it's emotional. And if I add it now, it's your area that you're already guarding, because every area is a baby. And I'm just saying you need to do this. And I'm making a judgment based on not yet complete numbers. Yeah, we start taking it personally instead of just getting down to the specifics.
Emmanuel: Yeah. And then you can avoid, you end up missing what the person is really saying is like, yeah, it was 25 out of 5,000, but it's 25 out of the 26 tickets that my department had to deal with. And to that person, they may not say that that's the issue they're dealing with. They may say, make it sound so, oh, this is a horrible issue. This is ridiculous. Well, you guys need to fix this. But to them, that's a huge pain. It's an, and they come at it that way. So by getting specific to your point, you know, uh, and sorry, we, the specific was a 25, but if it's like, we have a huge issue. What do you mean a huge issue? Well, to them it's 25 out of 26, they didn't say that. They just came to bring you this problem that this is a huge issue, and now we have to drop everything and deal, no, we don't have to drop everything and deal with it. We just need to make you feel better in your department about, no, you're okay, it was only 25 out of 26, and usually the person gets calmed down, you know. But yeah, specificity is critical. So, do you feel like you're a success? Do you feel successful?
Success and Failure
Grace: Exactly. Yeah. I know I don't I feel like I don't know that success is an arrival, but there's moments of success. I feel like there we've had moments of huge success. You know, I think that I think that it's kind of, you know, I played sports soccer, especially my whole life through college, and it's like we can make it all the way to the national championship. And it's kind of like every game, but every game along the way is not, Oh, wow, we're successful. I don't know how to explain. I feel like we're still in the season. You know, like we're still in regular season play currently. And so all of our wins are amazing and they're so fun to celebrate, you know, but there's, I don't know that I feel like I've gotten to the national championship. I don't know. Does that make sense?
Emmanuel: Hmm. It does. It just makes you wonder what is the national championship. Yeah.
Grace: Yeah, yeah. I don't know. You're right. And maybe the national championship is like sale. You know, maybe the national championship is like, is hiring. I think I have my national championships in my mind. It's like it's like selling it. You know, and I've gotten like, oh, what would you sell it for? I'm like, well, you know, it's one of those it's one of those things that like the Supreme Court how the Supreme Court defined pornography or whatever in the 90s. I don't know what it looks like.
Emmanuel: You know when you see it.
Grace: You know when you see it. And so it's like, I'll know when I see it, the number. Or maybe it's hiring, the next big win would be like hiring out our next C-suite that like replaces me kind of thing. I'm not sure, I'm not sure. I don't feel, I know I do.
Emmanuel: So you don't feel successful. Yeah.
Grace: I see the successes and I see that we're a winning team, but I'm not like, oh my gosh, like counting trophies right now, basically.
Emmanuel: Yeah, I find it interesting because a lot of folks would look at you and be like, you're extremely successful. Look at how big the business is and why, why is that? And then there's other people who are bigger than we are 10 times bigger and would say the same thing you just said. What was that about?
Grace: Like, don't count your trophies yet kind of thing.
Emmanuel: Yeah, I'm not quite there yet. You know, you know, I'm not at the national championship. We're still we got work to do. We have a good team and we're, you know, we're doing okay. Yeah. What's going on?
Grace: Yep. Yeah. And you're right. It's probably a mindset. It's probably it probably has something to do with, you know, wanting to be stay humble. I don't know. But I do think that there are wins. I like to celebrate even the small wins. I really do. I like to look at things. I'm so grateful for how far we've come nine years is crazy people. I know some so many businesses don't even make it past the first three years. And so to make it three times that already is a huge feat and it's not something that I take for granted, but I don't know about arriving. You know, I don't know what that would look like. I don't know. I don't know what that is. I do know that it's mental though. I'm sure that it's mental.
Emmanuel: I'm pausing because it's, it's just to me, one of the scariest traps in business, right? Cause like, yeah, if you were to ask me, if I feel successful with the business that we built, it's like, I force myself to say yes now. It's a forced yes, because I would have answered just like you did up until like a year or two ago, which after we talked about a lot of work and therapy and those kinds of things, it's like, you just have the, just like we've been talking about how growth is a choice and the way to feel really start to win is to plateau at some point, right? It takes money off the table. I think success is a choice, right? Success is a choice. It's some way you just decide I'm successful now. Cause otherwise you put you, you leave one rat race of the professional world and you put yourself into another rat race of I'm not at the national championship yet. Because, right? Like if we go back to podcast episodes when we were first starting out, I still remember when I was trying to make, get us to where we were making $4,000 a month so that I can apply for the e-commerce fuel community. Because they had a minimum, you had to be making like, you know, $4,000 a month, $50,000 a year or something like that, right? And I was just like, I wish I could get there. I wish I could get there. Now it's like, you know, we're doing five, six million a year and it's like we haven't made it yet. You know, I was so proud when we made it into the e-commerce fuel community. We're doing $50,000 a year, $60,000 a year. It was just like, yay. Right. Um, and so you end up with comparison, comparing yourself to other people. Well, we're not there because that turned immediately into what now we need to get a million dollars a year, seven figure business, but now we need to, and you end up just on this rat race of it, uh, comparing to others, um, and Ben Horowitz has a phenomenal book, The Hard Thing About Hard Things and that's what helped me kind of break this down. Cause I remember when we finally hit a million dollars in revenue, I was talking to someone and just miserable how bad we were doing. Everything's breaking all around us. This isn't working. The systems are bad. It's so inefficient. And I was just, I just, I suck at this. I must be a terrible, horrible entrepreneur. I should have never left my job. How bad am I doing? It's like, wait, what? And in his book, he's taken several companies public, right? Which is like you said, that's the finish. That's the finish line. The gold standard of we made it for a lot of people and he's done it multiple times and he was saying how the whole time he feels like a failure. He has a knot in his stomach. There's bile. The struggle is real. And yet, um, he's, he doesn't feel successful. And that's just how we are wired. If you're, if you, and he said, why bother doing this? If you're not wired to be an entrepreneur, just don't do it. So to me, falling in love with the journey, falling in love with the process, being like, look, the fact that I'm able to do this is a win.
Grace: Mm-hmm. Yeah. Totally.
Emmanuel: The fact that we're not bankrupted and in a job or doing something we hate, that is success. So I forced myself to believe that. And as long as I'm still here, I'm successful. So.
Grace: Mm-hmm. True. Yeah. And I don't look at it as, I guess, binary, that there's success, and if you don't feel successful, you feel like a failure. Like, I don't feel like a failure, you know, by a long shot. But you're right. Like, if we're defining success, even with the little ones, I love celebrating little, even big wins. Like, we've had huge, some huge things that have happened from, you know, Oprah's favorite things for two or three years for for two years, different years, and numerous magazines and on different celebrities and you know, we've had interview, being on different TV shows, like those are huge successes, you know, like I'm not, and it would be silly for me to say we're a failure, I don't mean that, but I think the way that you said it did make me pause, like, do you feel like a success? And it's like, I guess, yeah, you're right, if I, from how you just described it, yes, we are successful, you know, 100%. And I like that you define that choice of words. And it doesn't have to be that you arrived. It's not, you're not asking did you arrive. Yeah.
Emmanuel: Good. Yeah. No, cause it is a choice. And the best part about it is because now what's next, right? What are we doing now? Because we don't have to be done. Right. I just love taking the energy going forward because I talked to, I was talking to a client today who's trying to get to where they have consistent sales. They're like, I'm sorry, how much did you make last month? So nothing. How much did you make last year? You know, I made a couple thousand and those folks are successful in the things that all my email is only 800 people. Only? You know how hard it is to get 800 people to say, yes, you can have my information. Like that's how hard, like most people who have, right. Most people who have never done this have no, cannot fathom how hard it is to get one, right. And they're impressed. It's an impressive thing to decide to make something and birth it into the world. So if we don't feel successful, we're hurting ourselves. So that's the biggest message I want folks to take away from this. And so to that end, we're not at, we're always constantly saying we're successful, but what is next? What are we working on now as we go forward? And I'm excited because in the next couple episodes, we're going to be talking with even other entrepreneurs. And I'm excited to have you join me to interview them. And we're going to be getting advice from them and giving advice and talking about their stories and figuring out like, how do we keep going? So let me pause and ask you like, what's next? What's next for your business?
Grace: Yeah, so next for us is of course new products. So we're excited for our 2024 lineup from some haircare products, which I'm really excited. This is like a baby that you know, you've been along the journey with me. And you, from before I really started to develop these and it's been, you know, three, four now years in the making. So I'm super excited about that. And then, and then new products in terms of, in terms of some of our new styles, some different turbans and really fun stuff, and then our new markets. So we're just gonna continue growing both within the e-commerce space, but then also with some of our retail partners, which have been growing, so yeah. Yeah, how about you? I know that we, you're right, you mentioned it earlier, that the big reconciliation was able to happen with the boundary line put into place, and you being able to pursue the things that you wanted to pursue. And we noticed that we had kind of a difference in vision, and you were able to go off and do that. So, you know, what's next for you?
Emmanuel: Yeah, so obviously my side is more of an agency offering. So I just love the idea of what, what we created, right? So you're the product creator, the founder, you make the stuff and you birth things into the world and you're good at that, right? And I came alongside to help grow a business and an infrastructure and build systems around that. That's what this agency is all about. Finding other creators who are just like, I love making stuff, but I get, I just hate running it. And so that's next for me is to continue to find more folks like that who are like, look, I just need someone else to take all that operation stuff off my plate, marketing, systems, the pro. I just want to go make new products and interact with customers and serve them successfully. That's what our core has always been at Eleyae Systems, I put it on my shirt because it's a reminder, but that is the core of what we're about. And so next we've done that, we've worked with over 100 folks so far. So my focus now is how do we scale our impact even broader? And so really what I wanna focus on is putting out more content to help teach people so, not a lot of people can afford to work with us, which is okay and I understand that because they're not there yet in their business, but I want to be able to be there for them. So we're going to be putting out more courses. So it'll be much lower cost, much more affordable. So they can still get the systems that we would give them and do for them without us having to, without them having to pay for us to do it for them. They can learn on their own and do those kinds of things. So that's really the focus of this next year coming up to scale these systems, to put them in the hands of more founders so they can scale their brands and be the next Grace Eleyae and be successful. So that's what's coming.
Grace: Yeah, that's awesome. Yeah. I love it. Love it. It's coming. I love it.
Emmanuel: It's exciting. So thank you everyone for joining us for this episode. We talked about our journey, we talked about some of the ups and downs, and we're excited because now we get to talk about with some other people, we're calling a founder rounders, we're going to do a roundtable event with some other founders and get their takes on their stories and, and we're just going to talk shop and trade notes and talk about how we all can succeed together and win in this game of business. So stay tuned. And thank you, Grace.
Grace: Founder Rounders. Thank you.