Thread by @Codie_Sanchez

The key to running multiple businesses at once:

Hiring an Operator

How do you do that? Time for a thread:

Why hire an operator at all?

It's only natural to assume no one can take better care of our assets than us.

Especially when the assets in question are businesses.

That’s why it’s common to see a lot of micro-managing from owners in their first business acquisitions.

But what happens when your portfolio expands to 3 companies?

Or 5, 10, maybe even 20?

Will you still involve yourself in the day-to-day running of each one? Will you even be able to?

This is where an operator comes in handy.

Here's how to pick a great operator:

Profit vs. Pay

I say this a lot:

Make sure there is enough profit in any deal before you buy.

But how much is ‘enough’?

If the business’ profit margins are large enough that you can hire a quality operator and still hit your personal profit goals, then yes, that’s enough.

Glassdoor can help with your research.

For instance, if I were buying an auto repair shop in Boston, I’d need to budget $60K a year + bonuses to hire an operator to run the shop.

Knowing this, I can subtract that number from the profits and see if there’s still enough profit.

Finding the right partner

The best partner is always one of two things.

1. Someone you know and trust to do the job.

Or

2. Someone who has done the job before.

I prefer to not have people learn on my dime.

But if I can bring someone up in the business, that’s ideal.

The trick to finding the best operator available is to either make your search as expansive as possible or as targeted as possible.

I search on Indeed, Craigslist (depending on the role), and social media.

I could also call managers of competing companies and reach out to people in my network.

Consider offering a bonus-based pay or an earn-in/buy-in for equity.

With proven talent, you always want to tie your revenue goals to their personal goals through compensation packages.

That way, everyone wins!

When it comes to human behavior, there are two principles I live by.

‘The past is the best predictor of the future’

and

‘Past behavior is usually future behavior.’

If someone was the captain of their baseball team or a military officer, that’s a good indication.

While searching for a compatible business partner, keep your eyes peeled for a previous leader.

I always look out for four things when interviewing potential partners.

1. Experience - Both in the business and as a leader.

2. Culture – Do they fit the core values of your company? More importantly, do their core values align with yours?

3. Goals – Do their future goals align with the opportunity?

4. Behavioral Assessment – I am a huge believer in using a behavioral assessment for hiring. Especially in leadership roles.

Want more tips on running multiple businesses by hiring an operator?

Read it for FREE here: contrarianthinking.co/the-key-to-run…