Ep459: Amit Agarwal – Hire Smart People to Scale Your Business

Andrew Stotz 00:02
Hello fellow risk takers and welcome to my worst investment ever stories of loss to keep you winning in our community we know that to win in investing you must take risk but to win big, you've got to reduce it. Join our community and get the risk reduction checklists I created from the lessons I've learned from all my guests and much more also claim your special discount on my six week valuation masterclass boot camp, where you learn how to value companies like a pro, and advance your career go to my worst investment ever.com to join for free. Fellow risk takers, this is your worst podcast host Andrew Stotz from a stance Academy, and I'm here with featured guest, Amit Agarwal emit Are you ready to rock show?

Amit Agarwal 00:49
Yes.

Andrew Stotz 00:50
Let me introduce you to the audience. Amid is the founder and CEO of no broker.com, the world's largest CTC real estate platform. Now, with 13 million customers. This platform is eliminating brokers and agents in real estate transactions with a tech based approached, he has raised $150 million of institutional funding so far, and the no broker business model is disruptive, tech based, capital efficient, and designed to scale globally. I mean, take a minute and for learning further tidbits about your life.

Amit Agarwal 01:34
So I am an engineer and an MBA and we started no broker with the concept that we will connect owners and tenants and buyers and sellers directly with each other without any agent or broker in between. We started seven years ago, initially, it was difficult to get funding because people felt investors fail that this is not something which has been done at a large scale anywhere before. But over the years, we have, we have got a lot of customers now 1.3 million 30 million, and a large team and doing pretty

Andrew Stotz 02:10
well. What I wonder what gave you the confidence to think that this could work because a lot of times, when we look at a traditional business model, I mean, you were really going up, the traditional business model is done everywhere in the world, a person wants to buy a piece of property, and they're doing it through a broker or an agent, somebody that's taking care of them all the way through the process.

Amit Agarwal 02:33
So I think what we felt was that today in this internet age, I can send a friend request to anyone, I can send a friend request to Brad Pitt. He may or may not accept it, but I can send it. So we will advise it so that every platform is working with a broker and why can't we connect owner and tenant directly with each other. And we just saw this as a problem which is widespread as a consumer in India and failed it we should have do it with the help of technology. Of course, there was no precedent but isn't startup about doing something new many ways.

Andrew Stotz 03:07
And where it just maybe you can just give the audience an idea about where you're at, you've got 13 million customers, you have a big team, you're generating a lot of revenue. You know, maybe just give us an idea of kind of where things are at right now.

Amit Agarwal 03:22
Sure. So we started six, seven years back, we bootstrap for almost a year. We worked from and then we all you opened office after we got funding and from a team size of perhaps eight to 10 people today we are the 2000 people. We have from bootstrapping stage to today we have raised $151 million funding from top investors across the world and from the customers who were basically 1000 a month today we add almost 400,000 new customers a month with a cumulative customer base of 13 million.

Andrew Stotz 04:01
Wow. And you are in your headquarter or you're living in Kolkata Where are you? Bangalore Bangalore. Okay. Fantastic. Well, I I'm really you know, I think that's it's a fascinating business and that's I wanted to learn a little bit more about it. But now I also want to learn about your experience. So now it's time to share your worst investment ever and since no one goes into their worst investment, thinking it will be. Tell us a bit about the circumstances leading up to it then tell us your story.

Amit Agarwal 04:34
Yeah, so we basically bootstrapped for a year and then so I will talk about the mistake which we did while scaling up. So we basically got habituated doing everything on her own. So be it finance bit HR bit running business, everything will basically go through me and somehow I started feeling that that's how it will work in the Richard also and I need to be in control. And when you posted for a year and when you are getting funding, you basically want to be in control, you want things to be decided by you. And so what we used to do is that even if you have to give an offer letter to a person, I will type that offer later in overtime, I will email it to him, if you have to pay a vendor I will basically pay from from our company account

Andrew Stotz 05:28
and basically never slept.

Amit Agarwal 05:30
And we basically, and when it came to hiring people, we thought that we should hire people who are Junior, because I am the one who is going to take decisions. And slowly it just blew over. So it was all over the place. He did not know more parts are going when he had to try something new, I would have to be the one who would have to decide for small, small decisions, the team will be stuck because they wanted to speak to me. So I think it basically for a few months, it was very chaotic.

Andrew Stotz 06:06
And when did you know that this just isn't gonna work anymore this way.

Amit Agarwal 06:11
I think it was more of a chance that a very good guy just happened to come to our office. And we met him from my same college. And we ended up joining hands and he ended up joining us. And then suddenly I saw that the huge amount of change that this guy can bring is humongous. And I felt that now there are two, two people. So one more average has been copied. And he could quickly understand as to what is the intention? And what do I mean? And then I realized that I am not enough. And we need very smart people much smarter than me.

Andrew Stotz 06:51
Yeah, that's, that's, it's like also realizing that you're the bottleneck. And then you see someone come in, they can do it. And it just it's like an awakening. So how would you describe the lessons that you learn, and I'm thinking about, you know, young people out there, there's a lot of people and people that are listening, people all around the world, that are starting up companies, it's their idea, they're running their business with their idea. They're in control, you know, tell me the lessons you learn.

Amit Agarwal 07:19
The lesson, which I learned was that if you want to scale up, then being doing everything on your own, trying to control things is a very bad idea. You need to hire great people, great people, nurture great people in finance, great people in your team and do not think that whether they will be fully occupied right now or not. It's not about them being 100% occupied. In fact, if they will be occupied, then Anyway, you are too late in hiring them in joining them, answered them. So the objective is to get better people than you is to get expertise in each functional area faster. Before then you need and give them huge amount of independence and accountability.

Andrew Stotz 08:03
And how do you handle for the typical person listening, and I'm sure you face this at times, you want to get those people, but you don't really have the budget, you know, so you're kind of stuck, like you got to do it. Obviously, when you hit that point that you've got enough money to start hiring these people. But what do you do in between when you're kind of stuck?

Amit Agarwal 08:25
So in that case, I think compromise with the years of experience and replace it with higher passion. So had you had lots of money, perhaps you would have hired a 20 year experience guy. I think at that stage in case you don't have the money, perhaps it is better to hire a two year experience guy with much more passion. And many times at that stage, that guy's even better.

Andrew Stotz 08:51
Okay, let me Maybe I'll share a couple things that I take away from it. You know, you reminded me of two things. The first one is that many years ago in one of the businesses that I own, which might with my best friend Dale, it's a coffee business. Basically Dale had to do all the quotations and he had his calculations and he had everything set up. And basically they're just a time that we got to where we realized that salespeople were waiting a week for him to get the quotations done for potential, you know, sales, you know, that were ready to happen. And nobody else kind of had the knowledge that he had and the ability to price it and all of them. And we just realized that, you know, there was just a huge stopping point. And that was when we, you know, got our first kind of significant software that allowed him to get the salespeople to have their iPads or their computers and be able to create the quotations on their own. And I just, I just really remember that bottleneck. And it wasn't so much budget as it was just that we didn't see it a way out and then we found it through software when he just got exhausted. Doing. The second thing you remind me of is I have kind of a when I talk to people about startups, and they tell me about their business. What I say to them is, at least this applies in Thailand. I don't know about India. And it probably applies around the world to some extent. And that is, I have what I call like the $3 million rule. Like, how quickly Are you going to get your revenue to $3 million? Because that's $3 million, you now have the budget to have a proper management team to have a proper office to have proper software infrastructure to scale your business. But if you want to try to do all that, with $500,000, in revenue, it's hard. And that's what I call my $3 million rule. Anything you'd add to that?

Amit Agarwal 10:46
No, this sounds very good. I think this sounds very objective also, that given this mile, then it makes sense. Yeah,

Andrew Stotz 10:52
totally. I mean, because otherwise, you know, as a one man show, or one woman show, you just wear yourself out. And you've got to have a management team around you to be able to expand that. So let me ask you, based upon what you learn from this story, and what you continue to learn, what one action would you recommend our listeners take, who are in the same situation as you were to avoid suffering the same fate?

Amit Agarwal 11:18
So my assertion would be that we need to continue learning continue reassessing. So it might have worked really well when you did not have budget and when you were the only actor in the movie, but as the situation changes, you also need to quickly change and realize that now that zero to one journey is now changing to one to 10, and hence you need better people, then you expertise needs to be brought in. And then slowly start giving

Andrew Stotz 11:48
great advice. And for the people that are listening that you know, are struggling right now. And they're overloaded, they're overwhelmed, they're dribbling it all themselves, you know, I think the value that you bring to this discussion into them is to this stop and think about where you're at, it may be time that you've got to reach out and get help and, and build out your team. So you're not doing everything. And then you can really scale your business. It just reminded me of one other story I met, which is that I hired a guy, I had a young guy come into my valuation masterclass, to a live event, and he really liked it. So he signed up for the full experience, which takes a long time. And then he asked me to do an internship. And so we started working together. And then eventually, he was so good that I hired him. But he's the first guy that I've hired that can really do my job. Which is very, you know, most of the people that I've hired, are complimentary. They're not doing my job, they're doing something that I can't do. But he's the first guy that came in that can actually do my job. And my experience with that has been just absolutely liberating. For instance, you know, we write a lot of courses on valuation of companies and stuff. And I can tell him, this is what I'm thinking, and then he can create it, because he understands where I'm coming from and what I'm doing. And that's just the you know, and I just want for the listener out there to remember that there's two types of people that you're going to be hiring one is a person that's, that does something that you just never going to be good at, let's say it's accounting, or whatever that is. But there's also and I think that's part of what you described here is the idea that you're going to hire someone that's going to boom, kind of take your work away. And what a feeling it is. It's game changing. Yeah, fantastic. Well, I think a lot to learn there. Alright, last question. What is your number one goal for the next 12 months.

Amit Agarwal 13:42
The number one goal is to we have now into multiple services right from packers and movers and painting cleaning. The next one, your goal is to keep customers happy, expand into new services, and make them bigger.

Andrew Stotz 13:54
exciting, exciting. Well listeners there you have it another story of laws to keep you winning. My number one goal for the next 12 months is to help you my listener, reduce risk and increase return in your life. To achieve this, I've created our community at my worst investment ever.com and when you join, you get that special discount to my six week valuation masterclass boot camp. As we conclude a minute, I want to thank you again for coming on the show. And on behalf of a Stotz Academy, I hereby award you alumni status returning your worst investment ever into your best teaching moment. Do you have any parting words for the audience?

Amit Agarwal 14:37
Thank you very much. It was great to be on this podcast.

Andrew Stotz 14:40
We appreciate it. And that's a wrap on another great story to help us create, grow and protect our well fellow risk takers. This is your worst podcast host Andrew Stotz saying. I'll see you on the upside.