Nathan Sykes

March 13, 2021

You Can't Outsource Everything

Anyone who works with me can say that one of my strengths is being able to outsource tasks. (As a side note, is talking about your strengths considered pretentious?)

In fact, it's one of the key operating functions of Howdy Interactive, my private equity firm. We automate, outsource, and systematize different operations of micro-companies.

Every few days, I receive messages from people who've read my book, read my writing online, or just know me personally, all asking more-or-less the same question: "How do I approach outsourcing to set me up for success?". I normally give a canned answer I've developed for the situation, and they leave happily.

That's not what happened a few days ago.

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In case you don't want to read through all of that, the user was asking how to outsource everything, including growing the company and finding new products.

What?

I feel that outsourcing and automation has slowly dripped into all of our lives, and I 100% believe that's a good thing. Unfortunately, I also believe it misplaces some of our priorities and expectations. People, like the user above, expect that they can just outsource everything their company does, sitting on a beach in the Bahamas while other people work to make them more money this year than they made last.

In reality, outsourcing is really a hub-and-spoke system. It's a term traditionally used in aviation, but it's apt here. You have yourself at the center of this 'machine'. Your work, combined with your unique talents and skillset, actually make the machine run. The smaller day-to-day tasks represent spokes - things you can actually outsource to virtual assistants. But for the machine to work, you need to be at the center of it.

So how does Howdy Interactive grow?

Simple! We grow horizontally. Instead of spending a lot of time, effort, and energy placing competent, expensive people at the 'hub' of each micro-company and growing each one individually, we just let them run indefinitely without growing.

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Save for adjusting for industry trends and consumer confidence in our product, there's not really a lot we need to do to keep them active, because we specifically keep the companies we acquire very small in size, and very simple in scope. This allows them to operate without a hub - because we're not actively growing them, thinking of new products, or invest too much time into them. They just... exist. They make money at the same levels they've operated at. Nothing changes. It just works.

In turn, we place all of our efforts into our head office. That's where I take my position - at the hub of all of the Howdy Interactive Head Office spokes. I lead growth by keeping our deal pipeline full, and acquiring new micro-companies when they hit the end of that pipeline. Then, we outsource, automate, and systematize those micro-companies.

You can choose to have an active part in your company (or hire someone full-time, who has extensive management experience, and who lives in the United States or whatever country you live in to have an active part in your company), or you can choose to stop growing.

For our micro-companies, we strategically pause growth because it's not the best use of our resources. They operate at the same levels of profit indefinitely, or again, until industry trends change and we need to implement a change to maintain those KPIs.