Outsourced teams have been around for some time, but COVID-19 has opened the eyes of more entrepreneurs to the benefits of working with virtual assistants. In this era of remote work, if you’re leading a virtual team and doing great, then it wouldn’t matter if your employees are from the US or the Philippines. In fact hiring teams from other countries can save you a lot of money because you’re taking advantage of the differences in pay rate. Having had success in outsourced eCommerce since 2015, Matthew Yahes has taken a shift in his career in 2020 by founding Extend Your Team, a company that connects remote workers to US businesses. Listen in as he makes the case for remote teams and shares his leadership philosophy on the show with Alicia Couri.
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Leading Outsourced Teams With Confidence With Matthew Yahes
With me is the incredible Matthew Yahes. Let me tell you a little bit about Matthew. Matthew is the CEO of Extend Your Team. After growing an eCommerce company to $5 million in annual revenue, Matthew finally figured out how to hire a real professional overseas who could run the business better than him, and is now able to focus on things that really matter. Matthew connects entrepreneurs with executive-level, pre-qualified remote workers to help them scale their business and make more profit. That is excellent. What was the eCommerce business you were in before you made that transition?
I still own the business, so I’m still in it but because I hired someone who is great at their job, I was able to go do something else. I’m going in two verticals, which is one is gift baskets. The other is wedding favors. I know when you look at me, you think, “This guy is a wedding guy? He makes weddings nice.” I have one of the largest wedding favor sites on the internet. It’s super fun, gifts and weddings.
I typically ask my guests, what is your leadership philosophy?
For my team, it’s compassion, support and opportunity. I work with people from a different country. I have 100% remote workforce for years. One of the things you have to understand is the Philippines is not the United States. They have a different set of challenges, a different set of family obligations and things work differently. I’m very compassionate and understanding about the reality that they live in. It’s not better. It’s not worse. It’s just different. As a leader, you do need to understand that people, even in the United States, live a different reality than you. People have different realities and you need to be supportive and understanding. I also like to give all my people as much opportunity to grow as possible. The less political correct way of saying it is, “Giving them enough rope to hang themselves.”
“Then rescue them before they do.”
That’s a lesson. That’s the way people would talk when you’re talking among friends. With business, I support them and I’ll give them opportunities for growth and help them succeed to the next level.
That’s encouraging and very important too. When growth happens, mistakes happen. You’re asking people to do things outside their comfort zone sometimes, and sometimes they may not hit it out of the park right away. It’s giving them an opportunity to grow and learn as they grow because a growth process always comes with challenges. It always comes with trial and error. It’s not perfect right out of the gate, so that’s wonderful.
When they make mistakes, I also think that part of it is our fault rather than their fault. Here’s an example, my gift basket business, my person who was running it this year, it’s her first time doing it. She’s my head of customer service, making very large sales. One of the things she knows but didn’t internalize is we only get paid on shipment and you have to upload a tracking number. She didn’t realize that, “By the way, you need to do this for us to get paid because we don’t charge the clients in it.” She didn’t do it like two weeks. It’s a mistake. We still got the money. At the end of the day, it’s my fault for not putting a system in place to support her, to make sure the mistake didn’t happen.
That’s another great part of leadership is a personal responsibility, “The buck stops with me. I can’t go out and blame people if I didn’t give them the right tools or the right direction or the right systems to help them be successful.” It’s all also about taking responsibility for your part as the leader in whatever challenge or mistake that happened. I love that when you give people an opportunity to grow, even when they make mistakes, it’s not, “Look what you did,” and make them feel bad about it because that’s not productive in any way, shape or form.
It doesn’t serve you. Raising your voice and yelling never serves you, and it just reveals more about you than them. People are going to make mistakes. I make mistakes all the time.
It’s how we learn and grow. I don’t want to get off the topic of mistakes because we’re talking about mistakes, and since my show is about confidence as well, what would be one of your biggest mistakes that you could remember or want to share?Entrepreneurship is not about risk. It’s about opportunity and risk mitigation. Click To Tweet
I think the largest mistake I’ve made is I bought this eCommerce business. I acquired it when I had zero experience in eCommerce besides just selling some stuff on eBay. It was doing already millions of dollars a year in business. No experience I said, “I have a lot of confidence, maybe a little too much,” and so I jumped in. I said, “I’m going to borrow some money and buy the business.” I think one of the things that the biggest mistake I made is not putting a time clock on growth like, “If it doesn’t grow by 2X by X, I’m selling it and I’m out,” and I chased it. I chased it probably for two years longer than I should have. I chase it for about three and a half years.
Were you losing money?
No, but I wasn’t making. I was reinvesting most of my profits to try to get it to grow, and that was a mistake. I always saw like, “It’s right around the corner. I see it. I see the glimpse.” What I know now is I should have gated and said, “By a year and a half, if it doesn’t grow by X percent or X dollars or whatever it is, I’m out, I’m going to sell the business. It’s not worth my time.” What I effectively did was devalued my time for an extra for three and a half years. I devalued my time and it was a really big mistake and it caused a lot of problems. I was working all these hours and hours for what? It was for nothing. I might as well have just gotten the job because I wasn’t getting any benefits from owning my own business.
I think that’s one of the myths about starting up a business or owning your own business is that you really start your job without putting the proper systems in place or like you said, “If we don’t make X by X, let’s reevaluate this and see what we’re missing and how we need to restructure things in order for it to work or just sell it.”
“I’m out,” that’s what it should have been. Frankly, had I done that from the beginning, I probably would be in a better position than I am now. COVID was a black swan. Weddings are illegal. You can’t have group gatherings. I would have certainly been better off, but then again, I also wouldn’t be where I am now had COVID not happened because it forced me to pivot and start a new business. There are always opportunities and chaos.
In fact, in Think and Grow Rich that is where the biggest opportunities are. It often comes in the form of failure or defeat. That’s when you start looking for the opportunity. It doesn’t always come wrapped in a bow and say, “Here’s a great opportunity for you.” Sometimes you’ve got to look for it.
I started my first business a few years into the last downturn in 2010, 2011. Then I started this business, the latest business in the pandemic. It was in May 2020 was my first customer, and now we have 50 people for that business.
That’s great. That’s the business where you’re supplying a workforce so to speak for entrepreneurs to help them understand how to hire a remote workforce.
It’s virtual assistance. The problem that entrepreneurs face in the United States is they can’t afford the help they need, and it’s a major problem. What we do is leverage the fact that different countries have different pay scales. What’s a middle-class wage or an executive wage in the United States is not the same dollars, not the same amount in the Philippines.
The cost of living is very different as well. I have a VA and people look at me like, “What?” I’m like, “Yeah,” but that is their pay scale. I pay based on their pay scale. I’m not shortchanging them or anything, they tell me what their fees are. I’m not dictating to them what their fees are. It is such an incredible way to establish your business and get the help that you need without really running your business into the ground.
There are many advantages because now all of a sudden, we’re getting mid-career professionals who have all this experience for $16 to $18 an hour, who now can help you run your business. It’s not someone who’s going to just do social media for you. It’s someone who’s going to oversee all your projects, report to you what’s going on, follow up, help you manage clients if that’s the type of business you’re in, it’s a world of difference. For $16 to $18, comparatively in the United States, it would probably be between $80,000 to $120,000 a year plus benefits. It’s pretty dramatic.
It makes a huge difference indeed. You said you were a little overconfident when you bought your first business. Where does that come from for you?
I think part of it is growing up in New York, to be honest with you. New Yorkers, we are very confident of ourselves.
From a young age, you’re taking the subway by yourself.
You’re used to hustling. You’re used to believing in yourself and you used to believing that, “If this person can do it, why not me?” It is great but sometimes it could get you into trouble where you think you are a little smarter than you are. It’s the entrepreneurial rollercoaster. The truth is not really for 99.9% of people. I bought the eCommerce business and I thought I understood the internet because I use the internet. That has nothing to do with it.
It’s like, “I understand cars because I drive a car every day.”
“I like cars. I like buying cars. I like fixing cars. I’m going to open a dealership.” I learned a lot of lessons the hard way on how the internet works and what business is and competition. It can get you to trouble, but it’s also fun. There’s nothing like trying to succeed when you don’t have a choice.
It depends on the type of person you are as well, whether or not that will absolutely stress you out and send you drinking Pepto-Bismol every single day instead of water, or it flat out excites you. You’re like, “Let’s do this. Let’s hit it. Let’s go for it.” Part of leadership is also understanding your tolerance for risk and your tolerance for certain things, the unknown. How much can you take before you’re pulling your hair off?
I think a lot of it has to do with also risk mitigation. I don’t mind risk, but I’m also comfortable with mitigating risk. I’m not going to sit there and try to lose everything, but I’m going to go into a risky environment and say, “How do I mitigate this and not lose my shirt?” In my example, let’s go hire the right people. Let’s educate myself about the different areas of the internet business. Let’s also buy a business that’s sufficiently large.
It is self-sustaining.
Not just self-sustaining, COVID happens, there’s such a far way to the bottom that when it bottoms out, it still survives. The business did a lot of revenue, but I couldn’t have predicted COVID. In 2008, this business did amazing. It went down so far, but because it was so high, even when it went down, I make a lot less money. I’m not bankrupt. I also was mitigated because we had other businesses to balance out the eCommerce portfolio. I think it’s a misconception. It’s not about risk. It’s about opportunity and risk mitigation.
You can know what your tolerance is for it as well, but when you’re smart, you have to be able to do exactly what you’re saying, mitigate that risk so that you’re not looking at losing your show. You’re not diving into something completely blind. That’s not entrepreneurship. You want to take on a hobby or something, you do something like that. You want to build a business, you need to be able to forecast and do a few other things to help you make sure that your business is sustainable and can grow. Talk to me a little bit about your plan for growth after you realized the mistake that you made like, “How do I fix this?”Step away from your business and hire the right person to help you run it so you can focus more on growth-oriented activities. Click To Tweet
For me, what I did in this case, I was working 14 hours a day. I was like, “What am I doing? I’m valuing my time very little.” I said, “Let’s get somebody.” I didn’t see this. I was going to China with my wife on a family trip and she said, “I hope you would not work on this trip.” For those people that are married when your wife says, “I would hope,” that’s not a request. This is what you’re doing. She’s like, “Go hire someone from the Philippines to run your business.” I said, “I don’t know anyone who has hired a senior-level people.” She said, “Go figure it out.”
I took two months and I found someone who was a CEO, she ran a 100-person company as chief of staff. I hired her to be my chief of staff for at the time six people. She came in, and within 45 days, I was working three hours. Now, I probably work 2 to 3 hours a week, and it’s more a discussion I have with her than I’m actually doing any work. What was interesting is that right away, operations ran better. I was able to think. You hear a lot of people talk about, “Work on your business, not in your business.” It’s true, which is why everyone says it. I was able to focus on other opportunities to grow my overall business portfolio, and see what that would look like rather than just grinding and grinding. What you’re saying operations like, “Yeah, that matters. That’s going to make my business better,” but it’s not growth that makes your business better. That’s how you make more money. Optimization is great and you can make a lot of money in optimization, but you can only optimize so much. During COVID, what happened was the wedding business dried up. It didn’t dry up completely but significantly.
For at least three months, there was nothing.
We couldn’t even ship, my suppliers were closed.
I think between March and June 2020, there was nothing happening.
Even now, it’s still pretty slow.
We’re starting to see a lot of upticks. We had 50,000 people come to the site, where previously it would have been probably 120. We’re starting to see an upswing, but people aren’t going to buy, they’re buying for August 2021. We structured the business. Because I’ve been doing entrepreneurship for a few years, I was able to do it very quickly, but I said to her, “All my friends thought I was crazy when I found you. They couldn’t believe I gave you the key.” This business was doing $5 million a year like, “You’re nuts. How are you going to give that to someone you’ve never met?” I said, “It works. What if we find better people from the Philippines, people you can’t find because we’re Americans? Find them for other entrepreneurs to help them grow their business.” She said, “Yeah, of course, we can find people. It’s a country of 100 million people. They’re good people.” I started on this journey in May and as I said earlier, we were at 50 people now. It’s opportunity and chaos. In one respect, my business blew up or is on pause, as I like to say, but because I learned the lesson of getting out of my business, I hired the right person to help me. She helped me grow in a way I didn’t anticipate when I met her. I didn’t anticipate I’m starting a new business with someone I’ve never physically met.
We live in a world with technology now that these things are so possible. Twenty years ago, this would not have been possible. Take advantage of the opportunities and the time that we live in as entrepreneurs. This is a global marketplace. Stop boxing yourself into your region. It’s not just for big businesses anymore. It’s not just for the GEs and those big Fortune 500 companies that can afford to have whole warehouses and distribution sites offshore. This is for everybody.
One of the things that are coming out of COVID is everyone is a virtual assistant essentially, but not everyone. We’re all working from home. What’s the difference between Boston and Buenos Aires, and Manhattan and Manila? Nothing.
The time zones.
Except in the Philippines, there’s already a culture of working US time zones. There is no difference. For small businesses, take advantage of that. If you’re a business owner now and your team is working remotely and it’s successful, what’s the difference in getting someone overseas? There is none. They’re going to be loyal. They’re going to be appreciative. They love working with people from the United States because we treat them well. Take advantage, get ahead of it now is what I say to everyone because, in three years, everybody is doing this. There’s going to be more competition.
I wanted to ask you about team dynamics in a remote world. I know a lot of times when I speak to leaders who have a workforce in-house, a lot of things happen over coffee or just in the hall. You can pop your head in, ask a question. There’s that team dynamic. How do you create team dynamics with remote work?
I have two different businesses. I have my eCommerce portfolio and I have my virtual assistant business, outsourcing business. In my eCommerce business, we talk to each other every single week. I’m on a call with the team once a week. I’m on a call with my chief of staff every single day, a stand-up meeting but not a phone call, but actual video. When I was running the team before I had her, I was on the call with every single person individually once a week or once every other week. Now, she does that. Slack is very important, but video calls are the most important thing you can do because it’s not the same as a phone call. I see you, I see social cues. You talk to people about their family. We already had that.
For the virtual assistant business, honestly I’m still trying to figure this out. I meet with my internal team regularly. I’m on a call with them twice a week. My chief of staff still once every other day or more, every day or more often. We did a virtual Christmas party. Once a month, we’re going to get on to have some trivia night or things like this, where we can engage each other. The other thing I do is when people get hired 30 days after, we send them a t-shirt, we send them a mug. They feel part of the team. If you have one person in the Philippines and you’re not going to do this, I’m going to go over the Philippines once everything opens up probably three times a year, and host events to meet everyone in person. That’s something as an agency I’m going to do, and the individual entrepreneur isn’t going to do it, but you can have relationships with people. I have people working for me for four years. You’ve got relationships with people. know a lot about them and never meet.
I have a lot of relationships with people I’ve never met in person. They’re well-working relationships as well as great friendships. It’s like a pen pal. If you were younger and you had a pen pal before the internet and all that, because I’m way pre-internet, we used to write letters to people.
I remember in elementary school being forced to have a pen pal.
We are dating ourselves but that’s okay. I’m fine. People know that I don’t care about telling my age, it’s not a big deal. The last thing I want to ask you, what is a day in the life of now that you have this freedom as an entrepreneur, what does that look like to you?
What it does is give you more control of your time. On one hand, I’m growing a new business. My goal is to get it to 100 people by September 2021, 1,000 people within a couple of years. I have to work. The systems aren’t set up, I don’t have a fully built sales team yet. I’m still building the race car while I’m in the race. That being said, I took two weeks off, mostly during the last two weeks of the year. I’m going snowboarding, I get more control of my time. The other thing I get to do is focus on things that grow the business, and this is what every entrepreneur should focus on. I say stop and focus on operations. I don’t mean like your business is falling apart, but that’s not what makes you money. Because you have the best processes ever created, you’re not getting another client because of that. I focus on growth. I have these types of calls that add value to my business. I do sales calls because I’m the head salesperson, and that adds value. I talk to the team. My job as CEO is to make sure that the team has the tools to succeed in their individual roles. It’s not to do work. I get to strategically look, “We’re understaffed in recruitment. I want you guys to hire two more recruiters within the next 30 days.”
That’s the question I have for you that just popped up is how do you define roles for people in your business? If you were doing everything yourself before, how do you now define those roles?
When I talked to a client, here’s what I say, “Divide your week into two tasks. It’s really simple. It’s not complicated: strategic, not strategic.” Strategic, tactical, and anything that doesn’t require you to think or domain expertise, that’s tactical. Someone else should be doing it, put that out. Get rid of it. It’s probably 80% of your day. Hire someone full-time to take that over, so now you’re only focused on growth.” What I also say to people is, “If that frees you up from 80% of your tasks, you can’t grow your business by a few thousand a month, you have a bigger problem. Once you divide out all the tactical tasks say, “What is now busy work for the person who’s overseeing all this stuff? Push that down, clearly define a role, bucket it.”
You’re going to have, in my case, HR duties. You have client onboarding duties. We bucket that out and then you hire people to do that. They say, “How do I further segment it? Let’s look at hiring.” I say, “I have a recruiter.” “I need another recruiter.” “Okay, but what are they doing that’s busy work for them?” “They’re screening resumes.” “Let’s go hire resume screeners,” and that’s called scaling. Pushing down the work to specialists in each individual area, and it gets further and further reduced, and that’s how you have a scaled organization.Entrepreneurship is a rollercoaster. It’s all about staying in the game. Click To Tweet
This has been very helpful, very insightful and a lot of fun talking to you, Matthew. Is there anything that I should have asked that I didn’t ask just as we close?
I don’t think so. This was a really fun conversation. I hope a lot of people get value out of it. I would leave this advice. Entrepreneurship is a roller coaster. It’s about staying in the game, that’s what it is. Don’t believe what you hear in the media. You’re not Mark Zuckerberg. I’m not Mark Zuckerberg. They are not Mark Zuckerberg.
You are not Elon Musk.
That’s okay. There’s a big gap between us. Stick at it and it’s a craft like anything else.
Thank you so much, Matthew. I appreciate your time for coming in and sharing your wisdom with us. I want to encourage everyone to stay tuned to the show. We always have great guests that are willing to share their knowledge and expertise with us, and their own leadership philosophies, and their confidence, as you can see with Matthew here. As we close, I’m going to encourage you to be bold, be brave. Step into your own audacious confidence to lead yourself, your teams and your organization to success. Until next time.
About Matthew Yahes
As the founder of Extend Your Team, a Virtual Assistant company, Matthew Yahes helps entrepreneurs and operators of all company sizes grow their business by getting out of the grind. Matthew was working 14 hours a day on his eCommerce portfolio, managing a team of 6, was buried in operations, and it was affecting his marriage. The situation was not tenable. He had enough and finally figured out how to hire an A+ player overseas who could run the operations better than him so he could focus on growth. He realized that the core issue is people look for a “Virtual Assistant” and not a “Real Professional”.