Episode 47: Optimism in D Minor

Episode 47: Optimism in D Minor

Guests:

Karen Clark Cole is co-founder and CEO of Blink.

William Vanderbloemen is founder and CEO of Vanderbloemen Search Group.

Dana White is founder and CEO of Paralee Boyd hair salons.

Producer:

Jess Thoubboron is founder of Blank Word Productions.

Episode Highlights:

William Vanderbloemen: “When you help people receive free money from the government to keep their business afloat, they trust you. And then they want to hear more from you.”

Dana White: “I’m a little emotional because, a year ago, I thought COVID was gonna take us out. A hair salon?”

Karen Clark Cole: “Building a marketing team for us just didn’t make sense, because we don’t really know how to do that properly.”

Full Episode Transcript:

Loren Feldman:
Thanks for joining me today. Karen and William, we haven’t talked to you yet this year. Let’s start with you guys. Karen, how about you? How’s business? What’s going on?

Karen Clark Cole:
I love this time of year because the numbers all go to zero, and we just start over. So on one hand, it’s exciting. On the other hand, it’s like, “Oh, God, we gotta do it again.” But so far, so good. Everybody’s gotten used to being remote, so it’s less of a constant conversation. But we are starting to think about: What are we going to do with our spaces when people can start coming back later this year?

We’re not anticipating anybody’s doing anything until probably after the summer, and we have a lot of beautiful office spaces. Well, not a lot, we have four. So it’s just sort of rethinking workspace. We’re starting to actually do some prototyping, do some space planning—that kind of thing. But it everything seems less of a panic than it did last summer and through the end of last year, when we were just trying to make the year come out in the black, which we did. Everything was just focused on that. Now, I feel like we have a little bit of breathing room to start thinking, “Okay, what’s this year going to look like?”

Loren Feldman:
Do you think most people are going to come back into the office? Or are you anticipating more of a hybrid solution?

Karen Clark Cole:
We’ve done a lot of asking our employees, and it’s going to be hybrid for sure. I think that’s good. I like it. We’ve proven that we can do work from anywhere. What we’re asking is, “Okay, so knowing that you can still do that, what’s missing?” And it’s the coming together to collaborate, just to see each other. We are human beings, after all, and we do like being around other humans. That part is really missing. We’re trying to create a space that facilitates collaboration and coming together for gatherings or meetings. Certainly we want to see our clients. But I think what’s going to happen is the heads-down work will continue to happen at home.

Loren Feldman:
How about you, William? How’s your year starting off?

William Vanderbloemen:
We’ve had a great out-of-the-gates few weeks. I’ve said, for a number of months now—and people are starting to latch on to my prediction—that this year will be a year of massive job turnover.

Loren Feldman:
Are you seeing that at your place?

William Vanderbloemen:
Yeah, some. Not any this year yet. We had some last year. What I read are the tea leaves of like—usually in January you’ll have people call me and say, “I know you aren’t a job-placement service, but I’m a high-capacity person, and I’m thinking of making a change for the first time in forever.” I’m like, “Well, it’s January. Everybody wants to change in January.” Last year it happened in November and December. I’ve never seen that before. So you know, that’s a tremor. All of that is to say, when there’s huge turnover, that usually signals a really good year for us.

Loren Feldman:
William, we should specify. When you say, “when there’s huge turnover, that’s a good year for you,” you mean among your clients—not necessarily among your employees?

William Vanderbloemen:
Yeah, yeah, yeah, exactly. Turnover, as a market, means there are people moving around, and that’s kind of why we exist.

Karen Clark Cole:
So William, can you just tell us, at a high level, why you think this is the year for that?

William Vanderbloemen:
First and foremost, there’s just a latency in the market. And what I mean by that is, yeah, people left their jobs in 2020, maybe because of downsizing, but a lot of the voluntary natural turnover that would happen in a year didn’t happen in 2020 because people didn’t want to move during all this mess, or they couldn’t move. You’ve got a build up. There’s been a dam in the river for a year, and now it’s going to let loose, right?

So, that’s one. We’ve got a number of people moving back toward family of origin. If you’re in New York City, it’s like—people are leaving quickly, like the Titanic. You’ve got geographic reshuffling, that’s happening. A whole lot of people, during 2020, their job became something that’s entirely different than what they signed up for. It’s just made them say, “I understand the incremental change, but this is too much too fast. And I’ve got to find a new way.”

Those are a few reasons. We outline a ton of them. But it looks like a year of heavy turnover, so Loren, January, may well beat last January, which was an all-time record for us, and we’ll see where it goes and how long it takes for us to get past the pandemic into whatever is new, as normal. But it feels like employers are starting to be able to see or sense a finish line, and that has created optimism about hiring.

Loren Feldman:
It’s an interesting time because we do have the optimism of the vaccines coming online. At the same time, cases have been up, and there are the new variants that have people nervous. Your clients are on the front lines of this. What’s winning: optimism or pessimism?

William Vanderbloemen:
Optimism, and I don’t just say that because I’m an optimist. It’s not optimism that’s pollyannaish. It’s optimism in D minor. What do I mean by that? It’s like, look, here’s the thing: Even the most cautious doctors who I talk to—and the Texas Medical Center is arguably the best medical center in the world, and it’s two miles from my house—are like, “Yeah, the vaccine’s gonna get out. It’s taking longer than we would like, but it’s gonna get out.”

And oh, by the way, there are so many undiagnosed cases that have happened that we’re gonna get to a place where this will run its course one way or the other, and it’s not going to be in ‘22. It’s going to happen this year. That’s sad, because a lot of people are going to get sick, and that means a lot of people are gonna be very sick. Probably the death numbers are going to keep going up.

I think my clients, what really dragged on them in 2020 was they all felt like the Greek mythology guy, Sisyphus, who just rolls the rock up the hill, and it rolls back down on him, and he has to roll up the hill for all of eternity. That was 2020. It was like, “Well, let’s flatten the curve.” And then 30 days later, “Well, let’s flatten it again.” And there’s never a sign of a terminal point, and I think even if it were a worst-case scenario, clients that I’m talking to are sensing there is a terminal point. A lot of our clients are churches and schools, and they’re looking toward fall of ‘21 and the back-to-school push as a time when things should be a lot less clamped down and maybe back to whatever normal looks like. So optimism is winning, but not without a very sober sad reality that we’re not through this at all.

Karen Clark Cole:
So if we’re not even through it, like what you’ve just said, then why in January are people looking to turn over their jobs? It seems a little premature, isn’t it? Is it just like New Year’s resolution—that’s what happens?

William Vanderbloemen:
I think so. People are gonna balance the checkbook. They’re gonna lose 10 pounds. They’re gonna get right with God, whatever the thing is that happens in January. But beyond that, January means we’re in a new budget year, which means we of quote, “have new money”—which, as a business owner, I have no idea what that means. I have the same money in my checking account today as I did December 31st.

But it’s a new budget year, so we get things done. There’s planning for hiring. If you do it right, it’s not a two-week venture. It’s like, “Okay, we’re gonna need this person in place by the fall. So let’s back that out and say we probably ought to get going in the spring, which means we ought to talk about it now.” And that sounds like a terribly long time, but most of the hiring that we do is not for rank-and-file workers. It’s for executive level or leadership positions, and those you tend to see people taking a lot more time hiring.

Loren Feldman:
Dana, how are you doing?

Dana White:
I’m doing well. Paralee is doing well. We’ve had some challenges in the past week or so. My admin team is dealing with some personal issues: multiple deaths, health issues. Yeah, it’s pretty sad.

Loren Feldman:
Oh, gosh. Are you talking about COVID deaths?

Dana White:
No, not at all, thank goodness, but still death. My operations manager, she had two deaths within her family: one was an elderly family member and the other one was in reaction to the elderly family member passing. And then my manager, she has been in and out of the hospital, they just checked her back in—admitted her rather—to the hospital this morning. What I’m proud of is the fact that they are taking care of themselves, supporting their family, and using their work with Paralee Boyd to help take care of themselves.

We’ve talked to a lot of salons, a lot of businesses, and we are so blessed, to not only be open, but see our numbers increase. When I think about where I was a year ago, in March, when we were worried, we didn’t know what was going to happen—and I’m a little emotional because I’ve learned so much about myself—believing that when I put my mind to something, I can do it, without asking permission. I was scared on—I think it was a call with Karen—and Loren, you said, “So, Dana, what are you going to do?” And I said, “I just don’t know.” And I had a choice, and Jay put it out there: “What are you gonna do?” And I chose. And to see the results…

Loren Feldman:
What did you choose?

Dana White:
I chose to bear down! I chose Paralee.

Karen Clark Cole:
To survive.

Dana White:
Yeah, and I’ll choose her. I will choose my business every day and twice on Sunday. I started the product line. Yes, it’s slow-going, but it’s going! We’re not closing, we’re hiring! I chose not to climb the mountain, but to get on the Peloton and ride. Still get my workout in, but it doesn’t mean I have to ascend. I don’t have to scale Mount Kilimanjaro. But I can still build without moving. And I’ve learned the value of being still, getting my resources together, getting my PPP, winning Demo Day—which was awesome—applying for grants and loans, getting the work done.

And in January, 2021, I’m still here and getting ready to market and grow the business. So yeah, I’m a little emotional because, a year ago, I thought COVID was gonna take us out. A hair salon? It’s standing over somebody, shampooing their hair. I’m not a restaurant where I can load up your food in the back of your trunk or your car—and to see my numbers. Guys, January, we had a slow week last week. Great googly moogly, it was the worst. But overall, when I talk to other salons that are doing 5,000 this month, 6,000 this month, and to see us maintain steady double digits? I’m like, “Whoa, I chose! I chose Paralee!”

Loren Feldman:
Good for you. You mentioned Demo Day—I don’t think we ever really tied that up. I think the last time we talked about that, you were still deciding how you were going to take the money from them, whether it would be a convertible loan that they could convert to equity or you could just take it as a straight loan, I think was the discussion. Did you make a decision on that?

Dana White:
I did. I have taken $50,000 of that Demo Day money as a loan—an interest-free loan—for marketing. And in the event that I do decide to partner with a VC or an investor, I can take that loan and convert it with the rest of my money and turn it into a convertible note.

Karen Clark Cole:
You gave them no equity?

Dana White:
I gave them no equity.

Karen Clark Cole:
Oh, good! Yay!

Dana White:
If I want to later, I can. But for right now, I think I learned that the VC world is touch and go. I know that I have a great product. I have a really great business. COVID has taught me that. And it’s only as great as the people who I work with, and the decisions that I make, the work I put into it. Again, I choose Paralee. I’m going to start selling products on Amazon and selling products online through our website. We’re updating that to handle the volume.

I’d been advised to hang on to the $200,000 winnings, and a VC would come along and then give me money, and then I’d put my $200,000 with it. I think that’s a tall ask in the time of COVID. So I decided to shave off $50,000 of it, as we spoke about in our last episode. Well, that $50,000 is coming from a no-interest loan from Demo Day, and I’m putting it into a year of marketing.

Loren Feldman:
Are you planning on focusing that marketing on the salon, or on the products, or on both?

Dana White:
Both. We’re gonna start with products and then we’re going to move into butts in seats, because we’re still getting a lot of people in the salon who’ve never heard of us before—a lot of new customers who’ve just never heard of us before.

Loren Feldman:
How are they finding you?

Dana White:
Word of mouth. Word of mouth is what kept us above water for eight years. I can do better, and so it’s time to have an ongoing marketing budget starting with this $50,000, and I will grow it. I’m nervous, of course, because wow, that’s a lot of money. But I hear that if marketing didn’t work, nobody would do it.

Loren Feldman:
It’s a lot of money, but it’s also not really a lot of money for marketing, right?

Karen Clark Cole:
You want to look at that as a percentage of your revenue, mostly.

Dana White:
Right. For a small business, yeah, it is. 4,000-plus dollars a month? Yeah, that’s a lot for a small business like mine. But I’m fortunate enough to have the ability to do it thanks to Detroit Demo Day. I can do it. And I believe it’s gonna put us on the path to increase our revenue to invest more in marketing and grow the company even more.

Loren Feldman:
Karen, you’ve talked in the past about your marketing, and I think you’ve expressed a sense that you’re something of an undiscovered gem—that not enough people know about you. Although you do have a ton of big, well-known clients.

Karen Clark Cole:
We do, but we’re still—I describe it as the “best kept secret,” which is bad.

Loren Feldman:
So what are you doing about it?

Karen Clark Cole:
Well, I’m sort of laughing to myself, listening to Dana: “If marketing didn’t work, no one would do it.” It’s so funny how it’s so hard to spend that money. I mean, you’re talking about it being a lot of money. It’s always a lot of money, no matter what. It’s like getting a new roof. It’s painful to spend, to me.

Dana White:
Yes! [Laughter]

Karen Clark Cole:
But you have to, and so, as a result, I’ll tell you, if you don’t do it now, 20 years later, you’ll be the best kept secret. Luckily, referrals and repeat work and word of mouth is an amazing engine. I think all of us see that. You do great work, and you get referrals, and you can keep going, and you can grow your business, and 20 years later, you’ll be $30 million in revenue. I mean, that’s what happened to us with hardly any marketing.

Now, though, we really want to break out of the—literally 90 percent of our business is repeat referral work. Imagine. You can do that all the way up to millions and millions of dollars. Now we want to keep those customers coming and coming back and coming back, because that means we’re doing great work. But we want to change that percentage, at least I do. I want to see that percentage more like 70 percent repeat. Imagine if the other part were new business and new clients because of the efforts of our marketing work. We’re really focused on that now.

My strategy is always to fire bullets all over the place and see what works, and then we put our money in one spot. In the last year, year and a half, we’ve been trying lots of little things—all outsourcing. We had this realization probably three years ago that building a marketing team for us just didn’t make sense, because we don’t really know how to do that properly. It would be so expensive to hire someone who does know how to do it properly that we thought, we’re just going to put our money, give it to the consultants who come knowing what to do.

So we put money in lots of different little types of marketing, like for example, analyst relations. We’re trying to have better connections with analysts and Gartner and Forrester and in newspapers with reporters. We hired small groups who are really good at that. They’re helping us get traction there. And then a small group, which is great at SEO, and a small group, which is great at actually writing for those audiences.

We’ve gotten smarter about what’s working for us. For example, we had hired a content company that was just sort of generating blog posts, and it just wasn’t working for us. However, the analyst one was really working well, so we put more money there and took away money there. We’re constantly just moving the pieces. I’m excited to see it’s working, but you know, it took us 20 years to figure that out.

Loren Feldman:
When you say it’s working, you’re referring to your outreach to analysts and journalists?

Karen Clark Cole:
Yeah, we’re getting great traction. We’re in a Gartner report now, and so we’re getting great traction, which is exactly what we wanted.

Loren Feldman:
Are you talking about traction in terms of people writing about you? Or actual clients coming in the door?

Karen Clark Cole:
Both. Our percentage is going down a little bit. So when the volume increases, but the mix of that is more new clients, then I’ll know that we did it. It’s really working.

Loren Feldman:
William, you’ve spoken in the past about your content marketing efforts, about how you make everyone at the company—and I think you mean everyone—blog. And that’s your marketing. Any changes with you?

William Vanderbloemen:
You know, if you do any kind of marketing or sales at all, people talk about the funnel, right? There’s the top of the funnel where you attract people to pay attention to you and then you move down the funnel where they’re engaging with you. Toward the bottom of the funnel, they’re saying, “Well, what would it look like to hire you?” So you get top middle, bottom of the funnel. And we think through that, with our inbound marketing, blogging is top of the funnel. But I think we’ve discovered something new I’m calling the very top of the funnel, the “V tofu”—we talk about the top of the funnel being the tofu—and so I don’t know if that’s like vegan tofu extra special or what. And what do I mean by that?

Loren Feldman:
You’re opening a restaurant?

William Vanderbloemen:
Yeah, right. When churches and schools shut down in March, and it got clear that no one was going to gather for Easter, which is unbelievable, it got real clear no one’s gonna be hiring for a while. And I started looking at the PPP program for our own use, but then when churches and schools and faith-based organizations got included as qualified entities to receive PPP, we just said, “Well, we could keep our money and just cut our costs. Or we could keep working hard and spend all our salaries, resourcing other entities about how to get their PPP.” And Loren, we’ve directly counseled over a quarter million people now. Our email list is three times the size it was a year ago.

Loren Feldman:
Are you doing that again for the second round?

William Vanderbloemen:
Yeah, not as much, because the people who are paying attention to the second round, generally speaking, are people who paid attention to the first round and have their ducks in a row. And so what does that mean? That means there are people that may never ever, ever, ever come back to us for content, but now they’re on our list. They’re not even really at the top of the funnel, where they’re reading a blog we wrote about staffing. They’re doing PPP, which really has nothing to do with a talent solution that lasts. It’s a very temporary thing.

But this very top of the funnel now has us asking questions. Well, what are the next tops of the funnels? What are the things that we need to be the expert on if no one else is going to be, and just as good will, serve people and offer free content that really is not directly connected with what we do? Time will tell whether that pays off.

Karen Clark Cole:
How do you connect your PPP advising to talent searching?

William Vanderbloemen:
It wasn’t some master plan. What we found out on the back-end was we’re advising people about how to keep their staff intact and how to keep their personnel budget above water. We have an incredibly OCD database. If you come on our website, and eventually we have your email address, I can look backward at every time you’ve been on our website. We score you every time you’re on it. We can tell what you’re reading. There’s a little bell that dings when you hit a certain score that says, “It looks like they’re about ready to hire somebody. You should call them.”

While the PPP advice won’t score people very highly to begin with, it will be the beginning of a longer-term relationship. When you help people receive free money from the government to keep their business afloat, they trust you. Then they want to hear more from you. And sooner or later, they will have a staffing need.

Karen Clark Cole:
I have to ask: What CRM system are you using that’s so good that you love?

William Vanderbloemen:
It’s a Frankenstein. So if you think of it like Lego blocks, the base platform is Salesforce. And then I think the current owner of what we use is called Bullhorn, which is one of the bigger ones. And then we custom-built a snap-on on top of that for faith-based, because there’s some categorization and tagging that needs to happen there that’s very particular. Then running right alongside it—I wish they could run together, but I haven’t figured this out yet—HubSpot is really the key to the marketing piece, and they talk to each other fairly well. But it’s a Frankenstein. I wish there were one solution. The CEO of HubSpot is like, “Don’t use us as your CRM. It’s too complex. Just use us for the marketing.” We’re a weird little company, and for the moment we’re in, we have a nice-looking Frankenstein.

Karen Clark Cole:
Nice.

Loren Feldman:
So long as we’re talking about PPP, have all three of you applied for round two? Dana, I think you mentioned it.

Dana White:
Yes, I applied—what was it, Tuesday? I went through my bank and put my application in, and it’s under review.

Loren Feldman:
So, a much smoother process this time?

Dana White:
A smoother process, but more detailed. My accountant, bookkeeper, financial manager, she went through the application with me. I did the first one by myself, but this one, when it came to the records that they wanted us to have—and just making sure I did it right—I just did it with her on the phone. It took me 20 minutes, maybe. I got it done and got it in.

Loren Feldman:
So your bank has filed the application and you’re waiting to hear?

Dana White:
No, it’s under review as of yesterday. I haven’t checked it today. They review it to see if they need any more information from you, and then if they don’t, then they just send it on to the SBA. The people in my region have been getting approvals within days. I mean, literally putting it in on a Thursday, getting money in their account on Tuesday.

Loren Feldman:
How about you, Karen?

Karen Clark Cole:
No, we’re not applying this round.

Loren Feldman:
Is that because you don’t feel you need it?

Karen Clark Cole:
Right, yeah.

Loren Feldman:
Would you have qualified? Could you have applied?

Karen Clark Cole:
That’s a good question. Probably… Well, it’s a good question. I’m not sure, actually. But we are still waiting to find out what the status is on our last one. We don’t need it, and we don’t want to go through that again, necessarily. Because we still don’t know if our last one is going to be forgiven or not. We’ve been going through a lot of hoops to figure that out.

Loren Feldman:
How about you, William?

William Vanderbloemen:
We got our first round, and it was very, very smooth. We’ve used the same bank forever, and we use it for all of our banking, and I think that helped. I understand that it’s been forgiven. I’ve gotten that through word of mouth but not gotten the final form in the mail. So this go-around, our application was more complicated—not because the government made it more complicated, but just because our bank had serious technical issues that were a pretty major glitch. It was a mess, and I was, frankly, a little concerned that the money would run out, because it’s less money this go-around. But we’ve done all we can do on our end.

Loren Feldman:
Have you learned anything this go-around that you’ve been sharing with all your followers?

William Vanderbloemen:
Yeah, the employee retention tax credit, which is this tiny, little niche thing. I don’t know if that’s language that any of you are familiar with, but it’s a tiny little piece of this giant bill that was passed in early January. It’s a pretty incredible tax break, if you happen to qualify for it, and there’s a lot of math involved. I had our finance director spend two full days working on it for us to make sure we were compliant and right.

But basically, I think the spirit behind it is, if you were able to keep your people last year, even if you took PPP, and you’re retaining your employees, we want to offer you an income tax credit that’s equivalent to some portion of their salary. Loren, I know you’ve put this in the Morning Report before, but I would just encourage people that, if they haven’t looked into that, it’s worth a look. It’s not easy. But, man, if you work it, there is help to be had.

Loren Feldman:
Is there one particular aspect to it that decides whether you qualify or not? Can you point us in the right direction of who this works for?

William Vanderbloemen:
Yeah, you have a good finance director who can figure that out for you. [Laughter] I mean, honestly, I plugged the Morning Report. But you put it out there last week, I think, maybe? I forget.

Loren Feldman:
I think it was the beginning of last week.

William Vanderbloemen:
Yeah, maybe on Tuesday. We had a holiday Monday.

Loren Feldman:
Is that where you learned about it, William?

William Vanderbloemen:
That’s where I learned about it. And I’m like, “Really?” So I pored that over to my accountant, and she said, “Oh, yeah, we ought to look at that.” She’s wonderful. I would recommend her to everybody, but had I not read the Morning Report, I was like, “How would we have found this out otherwise?” And it’s like, “Oh, well, you know…” But the reality is reading the Morning Report pointed me in the direction, and I went down the rabbit hole.

Loren Feldman:
Thank you, William.

William Vanderbloemen:
No, no, no. I didn’t get paid for that. I don’t even get a holiday basket from Loren.

Karen Clark Cole:
Neither did I.

Loren Feldman:
It was a rough year.

William Vanderbloemen:
I read about it, I went down the rabbit hole, and it looked like, “Oh my gosh, we have to be able to qualify for this.” I know enough about our numbers at a high level, and then it really did require somebody who knows accounting to get in there and roll up their sleeves and spend some hours, but it was enough of a tax break. All I needed to know from my accountant was, I said, “Kristen, if this is a $2,000 savings, I don’t need to pay Renee two days of salary to figure that out. We’ll just let it go.” And she said, “No, no, no, no, no, if this is right, it’s a much bigger savings.” And that’s when I said, “Fine.” And we called Rene and said, “Hey, look, whatever you’re doing, push it to the side. Get after this, and let’s get it done.” And, you know, we’ve got all our paperwork in, and we’ll see where it goes.

Loren Feldman:
All right, in the time we have left, I’d love to run a question by all three of you that I got from a reader. We’ve been trying to do this every episode. For those of you listening, if you have a question for the 21 Hats team—it can be about your business or about their businesses—just send it to me: [email protected] The question this week comes from a listener who preferred to remain anonymous who asked: How do you decide when it’s time to fire a customer? Have any of the three of you been in that situation?

Dana White:
Yes! Oh, man. Yes.

Loren Feldman:
Do tell.

Dana White:
Oh, yeah. Wow, you took me back. On the top of my mind, there are a few customers who I have needed to fire. What does that mean? When you have a customer who comes in and disrupts the synergy of your business, when you have a customer who feels that their dollar is important—so important that they can change your business model—“I know you don’t do it like this, but because I’m paying for it, you’re going to do it like this.”

When you have a customer who feels like their service of is the same as in servitude to, then you know you have to fire a customer and ask them not to come back. Then sometimes, during that conversation, you see the change, and then you give them one more chance, and you realize that, “Yeah, this is just who they are, and we are not the business for you.” It’s the entitlement. I’ve had several customers we’ve had to pull aside. When everybody’s tense, and they’re not doing their best work because they know there’s a customer in their chair who’s gonna read us the riot act on every little thing, then we probably suggest that this is not the salon for you.

Loren Feldman:
Have you had to do it with someone who was a loyal customer? Was it painful?

Dana White:
Yep, weekly customer. It wasn’t painful, because once you left, I noticed that my staff needed to recover. We had a mother who had a mixed daughter, and her daughter had thick and curly hair, and she was screaming at her child, “This is why your effing hair is the death of me.” And her daughter would just scream and cry in the chair: “I’m sorry, Mommy. I’m sorry.” Yeah, no. We tried to work with her. We tried to give her tips, and then she got mad at us. Once they would leave, my staff needed to recover, which affected the customers who were there after who didn’t know what just took place in the salon. So no, we had no problem saying goodbye to her.

Loren Feldman:
It’s probably a little bit different with a B2B customer, such as you, Karen, would have. Have you been in that situation?

Karen Clark Cole:
Yeah. Luckily, not as often as you might think over the years, but how we work with our clients is very collaborative. They become part of our team, or we become part of their team, so the way we work together is really important. And in a handful of cases—there have been clients who—because of their behavior, their attitude, or their unwillingness to collaborate—have not allowed us to do our best work, or in some cases, even be successful in the work that we’re doing.

And then, in the worst-case scenario, it’s similar to Dana, in that the recovery of our employees, it’s not worth it. There may be a toxic environment in either the client’s company—the way they are as an organization—or that team not functioning well together. And we don’t tolerate that at all within our company.

Loren Feldman:
Have you had a tough one where you had to walk away from a big client?

Karen Clark Cole:
Oh, it’s all money, yeah. It’s all real revenue, and every dollar counts. It’s never what we want to do. But it’s never hard once you realize what’s happening. The decision is usually quite easy.

Loren Feldman:
I guess that’s true if it’s really toxic behavior that you’re talking about. How do you look at it if it’s kind of in that gray area?

Karen Clark Cole:
It takes longer, but it usually becomes clear if it’s repeatedly happening. We’ll try to get through the project and do our work. Usually, what happens is we finish it, and then we won’t work with them again. We finish it off, we survive, we heal our wounds, and then we vow to not work with them again.

Loren Feldman:
How about you, William?

William Vanderbloemen:
We had to add a paragraph or a clause into our contract. “You hire us to find your person, we’re going to stay with you until it’s done.” Well, almost all the time, that works out really well. But every now and then, you get into the situation where it’s like, “Oh my gosh.” I didn’t have a cancellation clause in my contract. Every clause in our contract has a story with a name behind it. And I won’t name names, but I can see the person in my mind’s eye who is the reason we wrote the cancellation clause in the contract.

We try and make sure people have plenty of time to read and understand what the contract says. We don’t try and force the thing. What we sell is a fairly large widget, in terms of purchase price. It’s not a four-figure thing or three-figure thing. That’s one thing that we’ve done to try and improve that situation.

But I think the far more important lesson I had to learn was not to sell to everyone. I love sales. I just love it. I’d sell you this phone I’m talking to you on and tell you it won’t get muddy and the connection will stay clear. I just love it. I feel it as a challenge, like, “I can make this work.” So I’ve found that that propensity inside me has led me to sell to people when there were warning signs going off. They may be nice people, but may not be a fit. We’ve developed some pretty careful criteria. So when you ask the question, “When have you had to fire a client?” I would say the most common time that we do that now is before they ever become a client. And we still mess up some.

Loren Feldman:
What are you looking for? What tells you you don’t want to work with this person?

William Vanderbloemen:
What do they say, “You can do it fast, cheap, or good”? We are not cheap. We’re not super expensive. I don’t mind what we charge. In fact, my friends in corporate search firms are like, “How do you make a living?” But if you call us to talk about a position you need filled, or whatever the issue is, and your leading questions are, “How much is this going to cost? How cheap can we get this done?” I’ll tell you right away: It’s probably not gonna work out. If your leading pain point is the price, there’s a very high probability we’re not going to get along, and I don’t want that.

Loren Feldman:
So you flat out tell them. You tell them, “You asked about price, so I don’t want to work with you.”

William Vanderbloemen:
Absolutely. You led with price. You should always ask about price, but if your first question is, “How much does this cost?” Or even better, “How cheap can we do this?” Then, no, this isn’t gonna work. And oddly, many times, I’ve had to slow a sales cycle down to see if it’s the right client. Because what I’ve learned—it’s a really counterintuitive thing—but if it’s a first-time connection, and they are, “Let’s go,” and don’t bother to look at the details of things, I don’t know why, but it tends to lead to a bad result. We’ve gotten to where we’re a little picky about that too, and we say, “I want you to slow down. I want you to take a little time. Make sure you know what you’re getting into.” And sometimes that’ll slow them down enough to actually ask questions.

Sometimes people will hear, “Vanderbloemen is the best at what they do, so let’s hire them. Just get them. I’ll sign it.” And then they don’t understand that we’re retained. We’re not a contingency-based firm. You don’t pay us when we find your guy. You pay us on a schedule. That’s very different. That’s the way most exec search firms work, but there are a lot of recruiting firms that don’t. I would say if people are too fast, that sets off an alarm bell.

Loren Feldman:
Last question, really quickly. We’re having this conversation at the very end of January. Did each of you set New Year’s resolutions, and are you still sticking with them? Dana?

Dana White:
Absolutely not. I survived 2020—and I bought a planner for 2020, which is pretty much empty up until May. So no, I didn’t set any New Year’s resolution. I felt like, for 2021, I needed to see a trailer first. You know, let me see what’s coming before I set any goals. I think I learned it’s day-by-day, hour-by-hour for me and just to keep going in the moment.

Loren Feldman:
Karen?

Karen Clark Cole:
No, not that I didn’t want to—I just sort of didn’t get there.

Loren Feldman:
William?

William Vanderbloemen:
I didn’t set any New Year’s resolutions. Back in March or April, when the world shut down, it got real clear to me that, from a fitness and health standpoint, this was going to go one way or the other for William. Either I was going to shut down and gain the COVID 19, or I was finally going to get serious about getting some habits in place, and that went really well. Now that we’re headed toward the shutdown being over, I just like to keep doing what I’ve been doing.

Loren Feldman:
My thanks to Karen Clark Cole, William Vanderbloemen, and Dana White. As always, guys, thanks for sharing.

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