The Build #22: Small

Small. It’s the opposite of what most businesses strive to become. 

Usually, when you start a company, you try to figure out how to get as big as you can, as fast as you can. However, in an era where leaders like Paul Graham advise startups to do things that don’t scale — hockey stick growth isn’t always the right goal to chase. In fact, according to author and consultant Rayce Rollins, the deeper connections you make with individuals along the way will define how sustainable your company can become, and whether you’re likely to survive over the long haul. It’s the story of Grow Small Consulting, coming up next on the Build.

Transcript

From 2820 Radio in Philadelphia, it's The Build. Conversations with entrepreneurs and innovators about their dreams, their triumphs, and their challenges.

Joe Taylor, Jr.:
Small. It's the opposite of what most businesses strive to become. Usually, when you start a company, you try to figure out how to get as big as you can as fast as you can. However, in an era where leaders like Paul Graham advise startups to do things that don't scale, hockey stick growth isn't always the right goal to chase. In fact, according to author and consultant Rayce Rollins, the deeper connections you make with individuals along the way will define how sustainable your company can become, and whether you're likely to survive over the long haul. It's the story of grow small consulting, coming up next on The Build.

Announcer:
The Build is made possible with support from 2820 Press, providing business consulting and content strategy services to customer-obsessed companies nationwide. More information at 2820press.com.

Joe Taylor, Jr.:
I'm Joe Taylor Jr. This is The Build. Welcome today to Rayce Rollins from Grow Small Analytics.

Rayce Rollins:
Thank you so much for having me, Joe. I appreciate the opportunity.

Joe Taylor, Jr.:
It's a nice day here in our beautiful corner office here at The Curtis in Philadelphia, and I want to talk to you today about ... What you've been doing with clients lately is looking at the intersection of marketing and financial insight, so for folks that are fairly new at running their business, what are the numbers that they really need to look at. What are the analytics that you help your clients measure and track.

Rayce Rollins:
Absolutely, great question. I think at Grow Small Analytics, our mission is really to improve the speed and the quality of the world's decision making, so we really to empower business owners to just decide on where to go based on their Google Analytics, based on their financial numbers, based on their qualitative data and their quantitative data. We look at that and we create dashboards that help them take that pivotal next step, so we really drive the decisions.

Rayce Rollins:
More specifically it really depends on the industry, so if you look at some of our restaurant clients, for them it's cost per plate that they really have to know. We look at covers. For some of our ... You know, we have a retail client. We really look at sales per day across all of his categories. We look at where people are coming in from certain channels, or it really depends, Joe, on a lot of the industry, where the entrepreneur has strengths internally with his team, and where we can come in and augment.

Joe Taylor, Jr.:
So walk me through, let's say that I am restaurateur and I deal a lot in the physical world. What is it that I have to watch for that decision to go from the online space to actually a patron showing up at one of my tables?

Rayce Rollins:
Great question. I think the hardest business, in my opinion, to run is a restaurant, because you have inventory, you have the service component, you have spoilage, you have a lot of different things going on, and then you have what is called dynamic pricing, which you buy a tomato today for one price, next month it's different, and that affects that cost per plate, so with restaurants particularly, with all businesses I believe in 100% data granularity.

Rayce Rollins:
And by that I mean, I think we should be tracking everything that we possibly can. Even if today we don't have an immediate use for it, the best practice is to track it. Right, so we're tracking all of your purchases by vendor, we're tracking all of your purchases by when you're actually doing it, we tracking all of your sales by table, day, time, who the waiters are, and we're really looking at the business and trying to quantify every single step in the process, and that's the first step, always, with any business from a restaurant or a consulting firm that doesn't have any inventory, is just having the discipline to count for everything.

Joe Taylor, Jr.:
So for companies, especially again in restaurants, food service, folks that have been traditionally mom and pop that eventually scale up to small chains, even, how do you onboard a program of analytics? Where do you start to begin to actually track that data and measure things?

Rayce Rollins:
Absolutely, great question, so it all starts with the data assets that they have currently. Most restaurants are gonna have a really legit POS system. Right, they're gonna be able to track with OpenTable, they're gonna have sales and all the POS right there, they're gonna have really strong purchasing. Where they tend to mess up, though, is at the cost per plate level, so that's where I really start with most mom and pop businesses. I look at this sort of in three stages of the evolution of a business, right? Where first you have the entrepreneur, but then the entrepreneur has to become a manager and really put in strong processes across all of the functions at the business, and then that manager has to evolve into what you call an executive, that can scale those processes.

Rayce Rollins:
Right, so for coming into a new client, they have good food, they have certain data assets. We really try to build those processes around can we calculate the cost of every single plate. What that requires, Joe, is two things. It requires a recipe that is so specific, almost like the world's largest restaurant, like McDonald's, every single thing is measured down to a science, so literally you can walk in off the street, learn the process, nothing's stuck in the chef's head, and anybody can really repeat the steps.

Rayce Rollins:
What that does, if you have that scalable, repeatable process, you can track it. You can quantify it, you can say, "okay, I need the french fries at this temperature," and that gives us the ability to calculate variance, to record error, to see which employees had the most return rates, and it just gives us a whole lot of things, so just to recap, you first look at the data assets the company has currently, and then you try to take those and then spread them across all the business functions, build documented processes that anybody can follow, and then we sort of build the analytics from there. We capture everything.

Joe Taylor, Jr.:
Some of what I hear you saying goes back to authors that I've read, like Michael Gerber with The E Myth, the idea that for you to get a business to scale you have to figure out a way to replicate yourself. If you're a creative professional, if you're a chef or someone that's figures something out, you have to teach that craft to other people. How do you balance the need to manage all of these numbers and build these systems and recipes with the thought that sometimes entrepreneurs get scared that doing this is gonna lose a little of the soul of the business. How do you actually scale in such a way that you don't lose sight of what makes your business special in the first place?

Rayce Rollins:
That's an important question. I think for all entrepreneurs, for every person, we only have 168 hours in the week. You cannot buy any more time. That's all you have, so if your desire is just to really build a lifestyle business where all the recipes are in your head, and you can really touch every customer, look, that's fine and there's nothing wrong with that. But if you want to build a business that sort of is independent and outlasts you, you have to build scale in from day one. Part of the ways that you scale without losing your soul is really to have what I call the five key points of any business.

Rayce Rollins:
Everybody in the business has to understand what the mission of the company is. Why does this company exist? Right? So if I go down to the head chef or the waiter, each one of those individuals should give me the exact same answer, because that scales. The next thing, after you have your mission, what you want to have next are your metrics. What are the metrics for my particular job, right? That I have to get right every single time in order to preserve the mission, and to really execute my job to the fullest ability. We graduate on to values. What does the company value? What's the culture that the company really wants to have? So we have the mission, we have the metrics, we have the values, we have the culture, and I'll leave you with those four. Those are the key four points that I would say that you have to nail down in order to scale and grow bigger without losing the essence of what the entrepreneur was trying to accomplish on day one.

Joe Taylor, Jr.:
How do you quantify things like whether a team member is fulfilling the mission of the business? Are there ways that you can figure out that someone is scoring well or not scoring well outside of the context of something like an annual review?

Rayce Rollins:
Absolutely. I think that one of the best practices at any level is that every single employee, using our restaurant example, should have one to three metrics that they're using every single day to say, either I had a productive, efficient day, or I dropped the ball. With a restaurant, you look at ... One of the most important things for a restaurant is the amount or percentage of tables served that order drinks, because drinks is a high margin item, where the plate, the main course meal is a lower margin, and then you get higher on the dessert, so one of the key metrics that they can have is what percentage of your tables are ordering drinks and are ordering desserts? So if you have 25 tables, and you know that you hit 23 of them ordering drinks sort of repeatedly, and ordering desserts, you should walk away feeling like, "yeah, I had a hell of a day today."

Rayce Rollins:
Another thing is turnover. So one the key things in restaurants are covers. You have to flip those tables, meaning you have to be diligent, you have to attend to that table, but you eventually have to move them out to get the next person in to roll. I think with every business I see that's successful, everyone can define one of the three things that I can control that I need to focus on in order for the company to be successful, and if I do this we are executing, and we are really executing our mission to the fullest extent. But everybody has to have their personal metrics for their job at their level.

Joe Taylor, Jr.:
And so at that level, you have to find ways to get individual employees to buy in to the mission as expressed though metrics, as opposed to just a credo, or a set of values, so what are the things that you find yourself doing with clients to coach them through a transition where they may have previously been just flying by their gut instinct, or they're feeling like, "this is how I've done it for years," or "this is how I think people in my industry do it." How do you overcome the resistance to putting those metrics in place?

Rayce Rollins:
Ah, great. I mean we live in what you call the information age, where we live in the time where benchmarks are readily available, where you can benchmark your business, your restaurant, against a publicly traded company and really look at the ratios, like "what's my gross profit margin versus what's yours", or "how much are you spending on costs of goods sold," and you can really just use that to give yourself a score card. Where I try to help clients get to the point is, a point of objectivity. Like, what's our objective, what's the measure, losing our sort of lean startup.

Rayce Rollins:
You know, let's define success or failure. Right? Let's define that now before we take that next step. Before we launch that campaign, before we open our business the next day. What are we expecting to do, and if we fall short of that expectation, why? You know, what did we learn about the market and the customer? What did we learn about ourselves and our team? What did we learn about the trends of the future, and what did we learn about our sort of organizational culture, so we have this sort of failure process that we're constantly looking and seeing more ways to improve. The key is to define success, and have an executable plan that we can review postpartum to see if we succeeded or failure, and just cutting right to the chase and saying, "okay, this is what we need to do next time in order to do better," and sort of make some small tweaks.

Joe Taylor, Jr.:
One thing I hear a lot, especially within the the startup community, is this concept of making your failure survivable, so we hear often, fail fast, move fast and break things, and I think that there's a little bit of entrepreneurial generational shift here. A couple generations ago, failure meant your business just fell apart, and that was that you were done, couldn't survive it. But when I hear failure now, I think in terms more of in agile programming. For instance, there are things called sprints. Really small, measurable amounts of time where you can say, "we're gonna try a thing for two weeks, or one month. We're gonna see what happens, and if we fail, it doesn't mean that everyone's getting fired, everybody's losing their job, it means that we're gonna try something different." So how do you actually help clients get through this idea that failure just means a measurement over a period of time?

Rayce Rollins:
Absolutely. Seth Godin once said, in one of his books or online, he said that "he who fails the most eventually will win." Right, so we're not talking about catastrophic failure. We're not talking about taking a risk so great that you eventually put your business at risk, but we're talking about doing things, or having the mindset, at least, to step outside your comfort zone, try new products, try new approaches, try new technologies that hopefully will help you win or achieve some sort of competitive advantage or some degree in success in whatever it is that you're doing. But you have to be realistic about the risks that you're taking. You have to quantify success and failure, and if you do fail, you have to have a process to analyze it, to improve.

Rayce Rollins:
A lot of times people just fail. They just really don't do the rigorous analysis as to why. Why they failed, why they sort of miscalculated things. They don't have the accountability for themselves to really improve that next step. You look at a lot of the new movements like growth hacker marketing, which is really just launching a smaller campaign. You just reduce it down to the least common denominator, and you just try things and you see what works, and then you sort of feed the beast that's working, and then you pivot as fast as possible if you feel like it's not something that you're gonna reach your desired goal.

Joe Taylor, Jr.:
We talked a lot about the restaurant industry because it's an easy example to look at, but you're actually working with folks across a variety of fields. How do you find yourself taking benchmarks or best practices from one industry, one silo, into another? Tell me about a client that maybe you surprised by showing them a way that they could learn something new about their industry from someplace they would never have looked.

Rayce Rollins:
Absolutely. I always start with a website called KPI Library, which is key performance indicator library, and basically they'll give you hundreds of KPIs across whatever industry that you need. We always start there. Here's a smorgasbord of KPIs that we can choose from, and then I look at what are the strengths and weaknesses of the actual business, because not every business is gonna be able to have a really fast table cover. So you look at a restaurant like Honeygrow, which has the fast casual style. Fast casual is built to move the queue as fast as possible. Very different than the Del Frisco's, right? That really competes on margins and sorta high-end drinks, price per table and things like that. It really depends on the brand. It really depends on the style, so I always do sort of an interview, if you will, sort of an audit of what the company is able to do. I look at the KPIs and the metrics that are available across all the industries, and I really pick three to five that I think they can have a lot of success in, and I push them in that direction.

Rayce Rollins:
So, give you a case in point, one of our clients is named Just Mike the Poet. He's a poet that has written four books, and he sells a lot on Amazon. He goes on 26 city tours every year, and one of the things that he was really excelling at was social media. It's something that he has a lot of strengths in, and he knows how to create content and really push it and engage with customers. But when you look at his Google Analytics, he really wasn't bringing in a lot from paid advertising. Right? A lot from email, or a lot from his just directly logging in to the site. Most of his traffic was coming in from the social media, which is fine, but we just want to see if we can lift overall sales by running small tests in the paid advertising stage, and we saw a big lift, and then we sorta doubled down on the angles that were working, and pivoted and changed some other things that weren't.

Rayce Rollins:
But it's really seeing, okay, if the goal is to increase sales and we are getting 80, 90 percent from social media based on our Google Analytics, and our other sources are not performing as well, let's not focus too much on our strengths. Let's see if we can increase the overall pie by focusing on some areas where we're not performing as well.

Joe Taylor, Jr.:
Wheel this back a little bit for folks that might be new to some of the language. When we talk about Google Analytics, explain that tool to folks who haven't heard of it.

Rayce Rollins:
All right, so Google Analytics is a tool that allows you to track users to your website, e-commerce sales, it tracks demographics. It's really cool. They have geographics and psychographics, so that you can really understand who is coming to my site, when, through which channels. Are they coming on the desktop? Are they coming mobile? Are they coming on tablets? Do they come from The United States or Russia? Which languages do they speak? And Google has a tremendous amount of penetration. Almost everybody has a Gmail accounts, and the moment you log into your Gmail, Google's able to really give website owners a site into the psyche of their customers.

Rayce Rollins:
They have two things that I really love. They have this thing called affinity categories. Affinity categories really tell users, "the people that come to your site, if I had to categorize them in one word, here's what I would call them," so they'll tell you, "okay, I would categorize your site users as TV junkies, or political junkies, movie lovers." And with that data, you can really build certain kind of content to really appease that audience, because you know what they like. Another really cool psychographic that they have, or data point that they have is something called in-market segments. In in-market segments, Google Analytics literally tells you, "your customers are in the market for these services," and that really helps you sorta understand what they're buying, and if you don't sell those products, you can definitely advertise your product or service on a website where they go.

Joe Taylor, Jr.:
And this is not necessarily Google just being benevolent for the sake of it. They're goal is to try and inspire you to buy more ads on their network, but they've found that it's a really interesting way to get you to be interested in these results and maybe buy some more from them, but this is something that's free. Anybody can sign up for it. The challenge is really reading those tea leaves and understanding what the numbers really mean.

Rayce Rollins:
Just like anything else, I think the world is overwhelmed with the amount of tools. We are inundated with data. We can capture pretty much anything, but what we're looking for is insight. After we collect all this information, what does it mean? What's our next step? What's our decision? And that's where the value ... At Grow Small Analytics that's what we're trying to do. It's not really about the tool. There's Google Analytics. There's Tableau. Excel. You have Clickview. So many different tools, but it's few and far between a business owner, entrepreneur really has his key dashboards daily that he can really keep the financial pulse of his business, and really say, "okay, this is what we're gonna do next based on the numbers," and that's what we're trying to deliver.

Joe Taylor, Jr.:
I think you bring up a great point that leads to my next question, so the distinction between a daily dashboard or a real-time data stream, versus what many large company executives are used to, which is maybe a monthly report, or a quarterly deck, or something like that ... What advantage does a business owner have when they have access to information that's in real time? Can they meaningfully make changes in the business, or is that information too much of a fire hose?

Rayce Rollins:
Absolutely. I think it's essential in today's competitive environment to have daily numbers, that are shot to you in email format, that are dynamic, not static. Having a static PDF report of sales, sending it to my proverbial restaurant, just using that as our hypothetical. If I send a report to my restaurant owner that says, "okay, sales for yesterday were $5000," I sent it to him with a nice little write-up in a PDF file, that's basic and that's really not really adding a tremendous amount of value. What adds value is that if he receives that email on a dynamic report, and he's able to say, "okay, I know my total sales were 5000, but let me drill down a little bit and see what products those were. What's slow-moving inventory? What's really catching? How many people are ordering drinks? What's my margin?" And really understand when sales are coming, so that you can staff properly, so that you know when to order.

Rayce Rollins:
You look at the world's best companies, I mean Wal-Mart. As big as Wal-Mart is, one of the things that people don't know is Wal-Mart does not have warehouses. Right? So they do cross-docking. The moment something's sold, you know, it's coming. Coming from their supplier's warehouse, and it's delivered on that truck. So you very rarely will walk into a Wal-Mart and find things off the shelf. That's all real-time analytics happening so fast, and what they're able to do by being able to make decisions fast is eliminate the warehouse and the storage, which will be a huge cost in there, just so they can deliver to you every-day low prices. It's really amazing.

Joe Taylor, Jr.:
But it's the idea that this data, this business intelligence data layer, that ten years ago was really only available to companies that were the size of Wal-Mart, but these are tools that you can actually put in place even at the small business level.

Rayce Rollins:
Yes.

Joe Taylor, Jr.:
And that's because we've got access to things like smart phones, and tablets, and the ability to track, "hey, I started the shift with ten tomatoes, now I have two. I better take that tomato salad off the menu for tomorrow if I can't get more. Or, I better buy 20 tomatoes tomorrow because we're selling a lot of those."

Rayce Rollins:
That's it. And a lot of these programs sit on Amazon Web Services which has greatly reduced the cost of storage down to pennies, so you're able to keep large troves of data, huge applications running in the cloud, and so you don't miss a beat. Those are one of those pivotal things that change how business gets done. You mentioned the iPhone. Just to be able to deliver a dynamic report that the executive can engage with, that wasn't available a couple of years ago.

Joe Taylor, Jr.:
Let's shift gears a little bit, because I wanna learn more about how you built your business. I would imagine that you're using a lot of the same tools and techniques- in software development we call this "dogfooding," right? So you get to kind of eat your own cooking first to see if it's going to work for you, before you try it out on a client. Tell me a little bit about how you decided to open up your own practice and start attracting clients that you wanted to work with.

Rayce Rollins:
Absolutely. I come from a very entrepreneurial family, so me going to college, I always wanted to start a job instead of look of one, so I really came with that perspective and that mentality. I learned it from my dad. So when I went to Temple University and I took an accounting course- and Joe, when I tell you the light sorta ... everything just clicked for me in accounting 101. I sorta got it. I understood the business. I understood where the value was, and so what I did was, I got a QuickBooks Pro certification and I started pitching my bookkeeping business to a couple small clients.

Rayce Rollins:
The thing that I learned initially was, with accounting, accounting had become a commodity at the time. Accounting was one of those things that you can get done on every corner, so it wasn't a thing that I could highly differentiate, so what I did was, I had to use accounting, but then offer another service to help businesses understand in real time what was happening. Because even though the books were tight, a lot of times they weren't using the reports to run the business, and that to me just seemed strange. But a lot of business owners were really running their business from checking the cash in the bank account, just a eyes on view, and really sort of a familiarity with the operation, but they weren't really using all the tools at their disposal.

Rayce Rollins:
And so what I did was, I really tried to beef up on the data visualization side, dynamic reports, got into Tableau, and then moved to a real-time arrangement where I can just deliver real-time dynamic reports, accounting and otherwise, to business owners to help them make that next decision.

Joe Taylor, Jr.:
Coming back to the scaling conversation, it's no longer just you. You have folks working with you. How do you find the talent to bring into your organization, that are gonna be able to deliver at the same level that you would deliver in front of a client?

Rayce Rollins:
Good question. I read a book a couple years ago called Business Model Generation, by Alex Osterwalder, and he really broke business down into nine sections, right? You're starting with your products and services, and basically what is it that you're going to offer to the market? And we decided that I was going to do two things: accounting, and data analytics and data visualization. I group that second one into two. I got out of CRM, which was something that I tried to do, but really couldn't get competitive advantage in the market doing it.

Rayce Rollins:
But when I really focused on these two products, I said "these are the skills that I want to train, that I want to build, that I want to master, so that I can continuously offer them to my clients," so I really hire accountants, I hire CPAs, and then I hire and teach those CPAs how to go beyond the financial accounting, and more into the managerial accounting side. I teach them how to not only produce a report, but really look at what that report means, and not only what it means, but how can we show an insight, or explain this story or this information in the most compelling way possible. That's what we use Tableau and Google Analytics for, to really build. So I usually higher people from accounting backgrounds, and then sorta shift them into what you call "data storytellers," and teach them the visualization tools. That's my process.

Joe Taylor, Jr.:
So you kind of break the usual mold of accountants. You know, every accountant that I have worked with will just kind of disappear down a rabbit hole during tax season, and then they come up for air. You are building a team that's actually helping folks execute decisions quarter to quarter, month to month, week to week. What are some of the things that you've learned from building out a team and being able to grow your own business?

Rayce Rollins:
I think for me, it's really having everybody understand the mission of the company. I think that's super critical, and if you took me out of the room and called up each one of my employees, they will give you the same exact answer. Our goal is to improve the speed and the quality of decision making. Let's break that down. Speed ... Everything I try to do is in real time. I want to get that information to the entrepreneur as fast as possible so we're trying to make that journal entry, we're trying to build that insight as fast as possible, and we're trying to improve the quality of decision making.

Rayce Rollins:
Whereas to we're really left-brain oriented as a group, we really want to dig deep into the numbers, find the story, extrapolate that story, and show it. Not just to present some pretty picture, but I always, "okay, what are we going to try to get them to do?" and unless we can answer that question, then it's really lipstick on a pig. It's really a nice report that they'll look at and say, "ah, cool." But it doesn't really provoke any next step action, so I think with everybody centered around that unifying mission, I can always know that my employees are gonna look and try to solve the problem as I would.

Rayce Rollins:
So that's number one, and the number two, just having certain values in the company. I learned this from Zappos. They publicize their values. If you have your values- LinkedIn is another company that publicizes their values- you can hire for that. You can reward those value when you see them. In our business, I love learning. I try to read a book a week. I think it's a huge competitive advantage just to know more. We sell knowledge, so if our skills are lacking, or if we ... most people graduate from college and never read another book. So I really try to encourage my team to read as much as possible, because you might read some article or learn something that completely changes the trajectory of the business.

Rayce Rollins:
We are DDD. Data Drives Decisions, so that's another value that we have. It's not the highest paid person in the company who's gonna win the argument, but who can take the data asset, take the data resource, and make that a compelling case to go forward. We really try to be as entrepreneurial as possible. I try to reward people for training and learning and trying new things. So I think, if you're getting me, I think if we have a clear mission with values that everybody in the company understands, you can really rally the troops and keep everybody on the same page, as you try to grow and scale your company, without losing people along the way.

Joe Taylor, Jr.:
Tell me a little bit about how new clients discover you. This seems like something that could be fairly abstract for your typical small business owner, so how do they even discover that looking into their analytics is something they even need to investigate?

Rayce Rollins:
A couple of sort of new client acquisition strategies. The first is, you think of a traditional accounting. They do taxes, they do payroll. Two very commodity-based services, not a lot of value added, they're very administrative, and they're cheap to do, so I usually give those away for free. Those are things that gets the foot into the door. These are ways that I can pivot against or challenge ADP or Paychecks or Intuit, and really just offer a service that really doesn't cost me too much to administer for free so that gets me in the door.

Rayce Rollins:
Another thing that we're trying to do is write a lot more and produce a lot of content. In this world, Gary V said, "You give 'em the jab, jab, jab, right hook. You help, help, help, and then you go in for the ass," and you really have to produce meaningful helpful content to help clients understand where they're weak, and then because you've helped them, they'll come out, reach out to you.

Rayce Rollins:
In 2013 I wrote a book called Good Businesses Grow Small, and basically what that means is just developing an infrastructure that allows you to do businesses one-on-one with customers, right? So having the data assets in place where you know who new customers are, how much they purchase, when they purchase, and you can really understand and walk each customer through the customer life cycle, no matter how many you have. That book really was a way for me to ... speaking at a lot of events, I started writing on Technical.ly Philly, and just trying to contribute to the ecosystem, the entrepreneurship space here locally in Philadelphia, just to get our name out there. We had our free services for you, our freemium, and then we tried to upgrade them to new services, but also having content that we can introduce and get in front of customers as well, so those are the two ways that we try to bring on new people.

Joe Taylor, Jr.:
Tell me about a piece of data, or a technology that's just emerging that you're gonna see is really important to your clients over the next few years. What should we be looking to start tracking?

Rayce Rollins:
What should we be looking to start tracking? Give me an industry.

Joe Taylor, Jr.:
Well, let's say, we're here at Benjamin's desk, which is a co-working space, so let's talk about hospitality, right?

Rayce Rollins:
Hospitality is a good one, I think. It's definitely something that's being disrupted on a lot of different facets. You look at Airbnb, and sort of platform that's come out with them, so what I think is the most important is really going back to, for bigger companies, being able to track each engagement with your customer on a one-to-one basis. It doesn't matter if you have a million customers or 50, the goal should be a 360 degree view. You look at Airbnb, for example, like you have your own platform, you can do ratings, you can have access to other markets and see how often that customer sorta logs in, how often that customer sort of engages with the platform, and that helps you to market different, more effectively to that customer.

Rayce Rollins:
Gone, I think, is the days of just taking one standard message and blasting that out to everybody. You have to be able to segment your customers based on their objectives, based on their level of engagement with your product, and just do custom messages to them. So, not so much as a new technology, but just a return to ... a new discipline, of really trying to get 360 degree view, so that you can keep customers in the funnel as long as possible, right?

Rayce Rollins:
Warren Buffett, the greatest investor, I guess of our time, he says, "the key to investing is not to lose money." Right? So protect the principal at all costs, and if you just bring that right into the startup world, I think new customer generation is a little overrated. Let's really focus on customer retention. You don't ever want to lose customers by trying to always raise revenue from new customers. You really want to keep the people that you have, keep high, high levels of engagement.

Rayce Rollins:
One of the things that I track internally is, when I send a report, I know how many times the actual owner opens that report. That's monumental insight for me. Something so small, because if I'm sending him reports, and he's ... the accounting is perfect, but he's not opening that report or using that report, or that report has a high bounce rate, he's not using it to make a decision, so I'm really not effectuating and achieving my mission to help him, or add value in there.

Joe Taylor, Jr.:
So you can actually tell if a client has even read the report that you've generated, so that you know when you interact with them next, you know, "I know you haven't taken my advice because you haven't read it."

Rayce Rollins:
You haven't read the report. It's Tableau online, right? So Tableau online lets you send a dynamic report, and you can actually track the views of the report. That's one of our metrics internally, when we look at our staff. At the end of the week we really look at, okay, who produced the report with the most views? And it can be from any client. If that client shares the report with somebody else in his department, it registers as a view.

Rayce Rollins:
I think that if we ... the reports that have higher views, they call us, we have a seat at the table, they ask us to add some insights into their decision making, and it really solidifies that bond that I'm trying to have with my customers to really add value to help them make decisions. Whereas most accountants, it's like you see them on April 15th, biweekly payroll, and your accounts reconciled and that's it. I need to build a business that was a lot more close and dear to the entrepreneur adding real value. And then you become indispensable in a lot of ways.

Joe Taylor, Jr.:
So, thinking about becoming indispensable at scale, tell me a little bit about the dream for your business. What are we going to see from you over the next ten years?

Rayce Rollins:
The next ten years I really want to add a third product, and it's something that I've tried and failed at many times, so if we're doing accounting, we're doing analytics, I want to do content. More and better. I've tried to do a blog, but I think the biggest mistake I've made is almost looking at content as just something else you do, instead of looking at content as a product. It's something that you have to put as much time, love, and attention into as the accounting. You have to be as diligent with your content, and as helpful with your content as we are with the analytics, so I'm really trying to step away from the day-to-day running of the business and really focus on writing, producing content, and really contributing in that phase.

Rayce Rollins:
I think for me, personally, that's my next evolution, is to just communicate the value through data journalism, and through just using analytics. Using everything that we do on a day-to-day basis. We live in, right now, a open data environment, where I can go do Philly OpenData and get just a unbelievable amount of data, and I just want to write about things, like civic or social initiatives, by just writing about data, and if that comes back and has some commercial benefit for the business, that's a double win for me.

Joe Taylor, Jr.:
Well we'll look forward to that. Rayce Rollins, thanks for joining us today on The Build.

Rayce Rollins:
Thank you so much for having me, Joe. I appreciate it.

Joe Taylor, Jr.:
The Build is a production of 2820 Radio in Philadelphia, Pennsylvania. Our producer is Laurie Taylor. Our associate producer is Katie Cohen Zahniser. Our talent coordinators are Katrina Smith and Gizem Yali, and our post-production team is led by Evan Wilder at Flowly Audio in Detroit. My name is Joe Taylor, Jr. Thanks for listening to The Build.

Announcer:
Thanks for listening to this episode of The Build. We hope you'll share this series with your friends, and provide us with feedback on the iTunes store.