Equation of Excellence

Rabah (00:00.975)
All right, three, two, one. And we are back, folks, for another episode of Equation of Excellence by Fermat Commerce. And we have an absolute barn burner today. We have the King of Miami, as perplexity AI says, Joel Pejarn is recognized as a revered luminary in the e -commerce marketing landscape and is based in Miami, Florida. So without any other further interjections, Joel, welcome to the show.

Joel Padron (00:29.902)
Let's do this, man. I get the usual monthly Robin Miami visit. This time we're just going virtual with it.

Rabah (00:34.159)
Let's go. Yeah, exactly right. Well, I mean, last time you were showing me how to swing a swing a golf club. So that was actually that was pretty fun. We played Doral, which was gorgeous course. We definitely donated some balls to the course. Hence the was the Blue Monster, I believe it's called. But that was amazing. How you living? How's Miami?

Joel Padron (00:50.51)
Yeah.

Joel Padron (00:55.246)
Miami's good, it's unfortunately summer so weather isn't as nice as it is most of the year so honestly locked in grinding a little more so I'll take it.

Rabah (01:04.207)
I love it. I guess before we jump in and get into the craziness at Homestead, all the awesomeness you guys are building, all the client value you're generating, give people kind of a trajectory of kind of where you started and where you're at now.

Joel Padron (01:17.102)
For sure, yeah. Been in the game for a while. Been full -time social media, digital marketing for over 10 years now. Started in the early days of influencer marketing with meme pages. So page -list themes. Now people know what that is. Back then, nobody knew what to do. So explaining to my parents why I left my dream job in private equity finance to go run meme accounts. Interesting conversations, but money talks. Money talks, so.

Rabah (01:32.719)
Yeah.

Yes.

Yes, yes, yes it does.

Joel Padron (01:42.926)
That's where I got started. So ended up having a network of over 10 million social media followers in 2014. That kind of segued into me building my own e -commerce brands just to kind of like monetize my own network. And it's kind of just snowballed from there. So loved the e -commerce space, worked at Crossnet for two years. That was where I really wanted to test at a bigger scale, like cool, a proven success individually. Wanted to go play in the high seven figure, eight figure,

the GDC game did that. So crushed that over two years and then went over to Homestead wanted a bigger and larger challenge. So I am the mad man that left brand to go agency the few crazys. So yeah, a little more gray hairs coming in ever since that change, but the landscape is moving fast, having fun and kicking butt.

Rabah (02:33.327)
I love that man. Yeah, what was that? Well, first off, it's so interesting. I keep bumping up against people in kind of the finance space, because I also wanted to be an investment banker. I went to school for economics. I didn't know you played in P .E. Yeah.

Joel Padron (02:48.11)
I briefly did that was the path I was going and I was like, it was what? Yeah, it was like 21. So I was I was already in there and I was like, I made more money from my own my own business. Worst case scenario, fail, go get my MBA 25 and it worked out though. So I escaped the finance life.

Rabah (02:56.079)
behind.

Yeah. Come back.

I love that. I love that. How's the switch from brand to agency? Because I actually weirdly recommend the inverse of doing agency and then going to brand. So tell me about that exploration.

Joel Padron (03:20.878)
I have done the complete opposite path of what's normal. I ran my own businesses, was a freelancer first for like the first eight years of it. So completely solo, running my own stuff, had employees. So I went founder first, then went W2 at a brand and then went agency. So literally the opposite of what most people should do.

Honestly, it's been a big change. The speed is crazy. Now, instead of going deep on one brand, you're 50 plus clients at a certain point. So it's a big difference of going very, very deep and narrow to now kind of more wide and macro.

Rabah (03:46.639)
Yes.

Joel Padron (03:59.95)
So I think for me, it's benefited that I bring that brand perspective where I understand how to go super deep, how to have the conversations with brands. Obviously the finance side plays a big role. Like what the founders really care about, you know, usually is a P and L. Everyone gets consumed with the marketing talk. So I've kind of taken my experiences and leveraged it in the agency space and seems to be working so far.

Rabah (04:12.879)
Yes.

Rabah (04:23.311)
Dude, I love that for you. I absolutely love that for you. Is there any frameworks or themes or anything that you would give to other either aspiring agency owners and or brand people that has really helped you springboard your career and your understanding of the marketing ecosystem people, anything like that?

Joel Padron (04:44.046)
Yeah, I think it's on agency side, I think the biggest learning is it's an operations game. So if I were to give advice to the owners, if you ever plan to scale, it's typically operations is what they need to kind of learn a little bit more of.

Rabah (04:57.839)
So well said. Yeah.

Joel Padron (04:59.63)
Yeah, they're usually good at like fulfilling the service, right? They're typically a marketer first, let's say in our bubble. They can run ads, they're really good at selling brands. But when it comes to like organizing, hiring, leading teams, keeping things like just organized, that's usually their weakness.

so I would say that's like the tip that I would give agency owners and a lot of them kind of reach out to me to learn more about that. When it comes to brands, at least my lens is very financial approach, right? Everyone just thinks you're going to scale your way to profitability when that's not necessarily the case. So I'm sure you relate. We can get nerdy with it where understanding your numbers is what it takes on the brand side. So starting from unit economics, figuring out what your breakeven costs are. Now you need to get this much contribution margin. Now you.

Rabah (05:21.871)
Yeah.

Joel Padron (05:44.032)
you need to get this efficiency target, this volume target, so reverse engineering it based off of numbers on the brand side. We still see a lot of brands not knowing their numbers, even at large, pretty significant sizes. So I would say those are the kind of areas that I recommend each type owner really goes a little more deep into.

Rabah (06:08.175)
Yeah, no, dude, I think you're spot on with that. And honestly, I've been dealing with a little bit of that myself just in the, I think, three stages of extending things up, like action, systems, optimization, and the ability to move. Because I, candidly, was the same thing. When I was running, I was part of a big agency, and then I ran my own agency. And there wasn't just this big need for systems, because there wasn't that many people.

you know, it was basically like me and a bunch of permalancers at my agency. And what I'm realizing now is succeeding and succeeding with the team are just two totally different muscles, man. They're just two totally different muscles. And what I've realized is the getting to the systems phase allows you to be more efficient. So you have the action phase, just fucking do it. And then when you move to the systems phase where you can have less inputs to generate basically the same amount of outputs.

And so that gets into really awesome places. And then the last, where for me it's the show, is when you can get from the systems phase into the optimizations phase, where you have all your systems in place, you have all your data in place, and now that's where effectiveness can come in. So now you can actually get more effective and efficient once you get to that optimizations phase. But yeah, man, systems are really hard. And I think the challenge with systems, a shameless plug, I'm about to release my B2B Notion system and marketing system, Marketing OS.

But what I've realized is a lot of people are capable. They just don't have the time because it takes a lot of time to think through. Like, even when I was at Triple Whale, I really didn't have time to build systems because you were just looking for growth. And when you're in just this constant hyper growth stage, it's a very hard sell to go to the boss and say, hey, I need two weeks to fucking get my shit together and make sure that we are going to be in a great place long term and moving forward.

But yeah, man, you guys are so ahead in that space because that is, it really is, in my opinion, the biggest Achilles heel for most operators is the way I say it, they try and catch lightning in a bottle versus building a lightning factory. And it's really stressful too, where you're just constantly running around, where you don't have understanding of who's working on what, clear ownership, clear responsibility. And again, it doesn't matter until it does.

Rabah (08:32.079)
But then when it does, it really becomes, in my opinion, the biggest impediment to real sustainable systemic growth.

Joel Padron (08:40.11)
That is so spot on and I think it's one of those things that we both get related to from our experiences where it's like.

As you said, it's not a problem until it's a problem, right? You've been part of hyper growth environments where building systems are actually the wrong thing to do when you're in such hyper growth mode. Those systems are obsolete if you're lucky in six months, if you're lucky once they live. So when you're in hyper growth mode, it's like you said, you got to take that kind of just like sprint action mode, just get the job done whenever you kind of, you know, intentionally or unintentionally growth mode slows down. That's when like you kind of move into those systemized and optimized.

Rabah (08:54.479)
Yes.

Rabah (09:00.175)
Yes. Yes.

Joel Padron (09:16.992)
So that's, I always say that one of the big things that people should get from, let's say consulting, right, is like most people know what to do, just like you said. They don't know what not to do, right? So it's like, there's points that you need to understand. You need to fix this now and what not to do. So following the framework that you have is sick and I'm hyped for that notion tool, baby.

Rabah (09:27.407)
Yes.

Rabah (09:41.295)
Let's go. Now, that's such a perfect articulation of, in my opinion, successful startups, is knowing what to let burn and what not. Like, is this existential? OK, it's not. Then we'll get to it. I know we need to fix it. But at this point, we really need to be working on the 10x, 100x stuff. But then as to your point, you start to mature in your business and your market. The positioning starts to get more solid.

then you really need to start to nail down like, again, efficiencies and effectiveness where you're out of that action stage. And honestly, I apply it to everything now because we're almost in that place with our content where it's like, OK, cool, we're putting all this resources behind content. What are the things actually driving, et cetera? But what I will say is why I like that three -phase system so much. Obviously, I'm biased because I thought of it. But because I think, to your point as well, a lot of times if you get systems before action,

then you just don't do anything. And so it's the old powerful shoe dog, Phil Knight, Nike memoir, where they had a list of Nike values and perfect results count, not perfect processes. And so that I think is the one thing that I would say you want to be cognizant of is one, when I build systems, I think there's almost like this Hippocratic oath of efficiency, where it's like, at worst, you can't make somebody more inefficient with your system. Like that has to be the bottom.

the floor. And then you just move from there because it really, when you like right now I'm seeing the system flourish. And it's just been such a like, it's incredible. Because again, as you get into your place where you're sitting across all these different deliverables, all these different stakeholders, like, you really can't just keep it in your head anymore. You need to be able to clear that out, and then work on the things that you can work on. And then I think the last thing I'll say on the system stuff is, it allows you to unlock knowledge.

Across the company. That's another thing that I think is really challenging when you get into a very sophisticated Company and workflows and everybody has their own ownership is how can you unlock and un -silo the knowledge across the company where you know Sales is saying this so you need to put that in a marketing and product is saying this and you can put that in a marketing and vice versa and you can have these really kind of bi -directional information streams and I think that's really when you start to see really high -performing teams and companies

Joel Padron (12:05.358)
Totally agree. It's a long journey, but it's pretty interesting, all the steps, and you can't shortcut it.

Rabah (12:10.607)
This is exactly right. How do you think, speaking of How do you think of like management? How do you run your teams? How do you kind of resource everyone? Do you have any thoughts or frameworks or, yeah, give us some color there.

Joel Padron (12:22.734)
Yeah, they're certainly always evolving. And I think right now a lot of my focus is actually right there in that area.

And I think, cause I view things very much in terms of like milestones, right? Like agencies or businesses will kind of grow and then they naturally hit a wall at a certain point. You need to solve whatever that is and then move on to the next step. For us, it was one of those things where we kind of introduced a new layer in let's say our org chart, right? So we're at the point where now you have a lead for every single core role, right? So if you have copy, you have multiple copywriters, now you have one lead copywriter. You have designers, you have one lead designer, right? Every.

Rabah (12:46.639)
Yes.

Rabah (12:58.095)
Yes.

Joel Padron (12:58.624)
Now we're at the point where instead of just like a head and then multiple segments, you now have exactly like that new level, right? So it's one of those challenges of how can we be efficient as you were saying, have cross departments really like understand, what the goals are, what's even going on, what everyone's working on. So one of the things that I've started recently is kind of just, I always like reverse engineering it, right? So now we'll get a huddle with these team members that are relatively like new to the roles, right? They need more context

Rabah (13:05.583)
Yes.

Rabah (13:17.231)
Yes.

Rabah (13:22.831)
Yes.

Joel Padron (13:28.48)
that they've never had, they've never been in these rooms. So a big belief that I have is the better context you have, the better decision making you can make. So I'm really emphasizing that with our team. So we'll kind of like talk about just like company goals. And I think that's a challenge that any agency or brand owner should be doing. If you cannot articulate your goals in a tangible manner, like, okay, you need to achieve this much revenue within this period. You need to have this percentage margin. Like you need to have a very solid,

Rabah (13:35.599)
Yes.

Joel Padron (13:57.998)
description of what the company is aiming for, how you break it out into departments, right? And then once you break it out of the departments, it's like, all right, what are the contributing members? What are the projects they should be focused on? Do they tie into these? Yes or no? Because like you said, if they're not the high leverage movers, people will fill their calendar with so much BS and you won't even.

Rabah (14:00.783)
Yes.

Rabah (14:10.127)
Yes.

Rabah (14:19.151)
Yes. it's so , We actually, it's very timely you said that because the, Rishabh had all of basically managers, directors, executives, everybody that can control their schedule. So everybody that's not an IC or individual contributor basically essentially designed their schedules. And I thought that was, like I had always done it, but I thought that was just such an awesome idea in terms of leadership where.

Basically, Mondays are all of our, so we run L10s, which are basically like a style of meeting for leadership. So I have a leadership marketing, and then all of my direct reports and my one -on -one with my boss and the lead gen meeting are all on Monday, Tuesday. So we basically have like review and planning and syncing on Monday, Tuesdays. And then that leaves basically the rest of the week to really get done and get stuff done. And then we do like a quick

async in terms of Friday just to make sure that the stuff you committed to on Monday because you're right man people will and I don't think it's a function of the person ideally it's not I think it's just a function to your point of like alright if you like everybody all my direct reports have basically like two to three rocks and if you're working on stuff that isn't gonna support those rocks then either don't work on it or we need to change your rocks because

that way it gives people a really clear, there's a great line I use all the time where when you have priorities, decisions are easy. And so now it gives people the ability, especially when you have high talented people that are great across a bunch of different functions, everybody asks for your time. And like a lot of people on my team, myself included, are obligers where they're like, yes, I want to help out, I want to help out. But there's a certain aspect of you can start doing other people's jobs for them.

And then your job falls off. So you really need to go through an order of operations. And so I've kind of restricted myself of like, OK, cool. Until I get my big stuff done for the week, I'm not allowed to help anybody else. Not that I won't, but I really need to accomplish what I need to accomplish because I'm not hired to help everybody else. I'm hired to run the best marketing team in B2B SaaS. And then however we can support the other areas, amazing. But if you don't get it, it's almost akin to the like,

Rabah (16:38.863)
the flight stuff they always tell you, right? Like you have to put your mask on first before you can help other people. Because if not, you just basically will suffocate. And that's kind of, for me, what has happened in the past where I just get stretched so thin and you start to, it's almost like a quasi life lesson as well, where are you giving your best self to the most important people to you? Or are you giving your best self to a bunch of people that really might not be?

that important and I think it's really easy to conflate the two.

Joel Padron (17:12.046)
That's a trap that I'm sure most people listening have fallen into. I've been super guilty of that, you know, but I think the analogy that I've used lately is like the default option for any manager, director, you know, anyone overseeing direct reports, you should always try to be the coach rather than the player. I think that's the best framework. Yeah.

Rabah (17:15.119)
I've.

Rabah (17:30.319)
That's a bar. That is a fucking bar. That is so well said. If you are a leader and you go into a meeting and you leave with deliverables, you have failed. Your job as a leader, exactly what you said, is to synthesize the information from all the different perspectives and then allocate those resources accordingly. And you should, not that, I shouldn't say never, you shouldn't speak in absolutes, which is an absolute, which is kind of ironic in that sense, but that's spot on, man.

Because I think at the end of the day, and I think that's the challenge with kind of people like you where you are multi -talented, but just because you can do it doesn't mean you should do it. And so very, or at least for me was a very hard lesson to get over because the other challenge is sometimes it's not going to be as good as you. And you just have to be okay with that where it's like, I mean, if you're, if you're under that 80 to 90%, then it's like, okay, maybe you either need to skill that person up or.

Joel Padron (18:19.438)
Yes.

Rabah (18:28.303)
You know, here's a nice sevens package and thanks for thanks for trying to keep the laptop kind of shit. But if it gets into the 80 90 percent, I do I just because you can't scale yourself and you can't pay people for the vision, for the strategy, for the but you can pay people to execute and maybe they're not at the highest level. But that was something that was really hard for me. Delegation was just supremely challenging for me. And there's that like few times where you're just like, fuck amazing.

Like they, you know, they didn't do it, but I was okay with giving up control and now I can do this. And so I think that that's such a brilliant point, Joel. I mean, that is, that is so on the money. huge.

Joel Padron (19:10.286)
It's a big learning lesson. I want to bolt on one thing there. I want to tie it back where you said kind of like the best advice. Let's say if someone's trying to climb up, you know, in a company, right? It's a separate skill to learn that. So it's a very separate skill where you need to become good at managing, delegating, and then even like AI, right? Think of it as prompting. You need to be able to give very, very clear instructions. Here's the deadline. This is the priority in relation to your priorities. This needs to take president. This cannot be bumped. If you're able to give instructions like that,

Rabah (19:19.343)
Yes. Yes.

Rabah (19:29.295)
Yes.

Joel Padron (19:40.24)
I think that's gonna be what separates that's what's gonna allow you to be a good manager or above in the future so having that skill is Probably gonna be it's a soft skill in a way, right? But that's all gonna get you probably further than you being like super super insanely technical Something you're sealing I'll rephrase it the ceiling that you have when you're able to manage delegate coach is much higher than if you're just the biggest whiz at one specific technical thing

Rabah (19:52.111)
Yes.

Rabah (20:09.231)
Dude, fuck it, I knew the Miami King would come with the heat. I couldn't agree with you more and I guess I should clarify too, like there's nothing wrong with being a super high level IC. It's fantastic, you can make a bunch of money, it's great, but to your point, that's almost like you're the best soldier and there's just a certain ceiling there versus a general that can run a whole theater. Like, I mean, those are just two different people and when I was always...

bringing it back to me, narcissistic as always. When I was at Triple Well, there was a really hard conversation that AJ had to have with me at the beginning where he was like, Rob, you're incredible, but I need a CMO, not a really awesome IC. And so I had to change a lot of what I was doing because I was in the weeds so much. And there's a little bit of overlap in the sense where early stage CMOs, it's just a really rough gig because you're just wearing all these hats where you're an IC, you're a leader, you're an executive.

you're running strategy, but you're also shipping the newsletter. It's a chaotic place, but you have to elevate yourself out of that. If not, is exactly what you're saying, where it's like, OK, I'm going to find somebody that can. And I always had the same kind of lens that you look through as well, where I always thought somebody's value was directly correlated to their technical proficiency, because I used to be a nerd. I used to do coding. I used to do all this stuff. And now I'm realizing like,

if you can get a really strong leader that can skill up a team, get everybody rowing in the same direction, get everybody online, get systems in place, like, man, you're going to pay them a whole bunch of money because it gets really hard really quickly. And the ability to not only sustain the success, but understand why you're succeeding, not succeeding, and then how to react to that is really when you start to get into the high level of management, leadership, et cetera. And it's,

It sounds cheesy as fuck, but it's real man. Like morale on a team, it's a real thing. And I was never that guy. And I am totally like fully bodied on the proverbial trust falls where everybody has to be on the same page. Everybody has to know what's going on. Like if you go across your org and ask everybody, what's the most important thing or what are we driving towards? And if you get more than three or four answers, like you need to have a resync and make sure everybody is kind of.

Rabah (22:29.999)
Aligned on what success actually looks like for the company and what success looks like for them. But this sounds like a lot of work. But on the other side, the output, the clarity, the morale, like everybody, there's a really cool concept called flow. And basically flow needs three conditions. You need to make sure that the skill or task is right above your skill set. So if it's too easy, you get bored, you quit. And if it's too hard, you get frustrated and quit. The second thing is you need a really clearly defined goal.

And then the third thing is you need a really tight feedback loop. And so an easy example of this is I used to be really into mountain climbing. And climbing was the perfect example because when you're on the rock, you have a really clear goal, climb to the summit. OK, cool. You want to pick the grades that you can do or are just outside of your level. And then the third thing is the feedback. If you go anywhere else, you fall. And so that's where I'm trying to get my not only personal life, but my.

all my direct reports on the team into these flow states where they know what the goal is. It's not too hard, but it's not too easy, and they have the ability to check in on whether they're succeeding or not succeeding.

Joel Padron (23:40.942)
Yeah, that's a fantastic framework. I love the way you put it. I would also say that it's kind of empowering too, when you allow them to do that. It's there, here, I'm empowering you rather than I'm delegating to you. You can even switch that if you want to, like mentally. If you struggle with delegating, you're empowering and not coaching them. And it's only gonna help them and help you. And like you said, if you achieve flow, you're working on the right things, your burnout level should decrease, which is the good thing.

Rabah (23:47.183)
It's...

Rabah (24:04.175)
Yes.

Exactly right. I think burnout is twofold. One, you're committing to too many things. And then two, prioritization. I think that it's just you really need to understand your priorities. But at the same time, here's a little shout out for the direct reports. When I was working my way up through the ranks, one of the best ways to do this is if you're, because one of the challenges is if you have like a hard charging boss or somebody that's not super connected.

They think that if I can just give you more stuff, your plate's going to get bigger. It's not how the world works. And so Joelle says, hey, Rob, I need you to do this, this, this. It's like, OK, Joelle, that's amazing. But here's my current priorities list. I won't be able to do x, y, and z if I take on a. Do you want me to take on a? And then if so, where does that land in the priority list? Because then it puts the ball in their court of like, OK, I'm working on the things you want me to work on. I just have this.

Joel Padron (24:55.726)
Yes.

Rabah (25:01.519)
I don't want to say belief because that'll put me into dogmas, but this thesis that unless you're the founder or the owner, the only thing you care about is making your boss happy. If your boss is happy, your life is good. And so you want to really be making sure that you are doing the things that they care about and be able to also a little side tip, be able to speak in the way that resonates with them. That's also kind of a management technique, but everybody has a question. And so being able to understand what your boss's question is.

And then basically orient all of your goals in productivity around that will just really help you skyrocket through the ranks. And again, kind of to the people stuff you were talking about earlier, you're just going to have a more fun, pleasant experience because there's no like gotchas or surprises. I was at Whole Foods. I had a great boss who always said, if I have to ask you how something's doing, you're not communicating enough. That has stuck with me forever.

Joel Padron (25:55.182)
That is all that is money. I love that.

Rabah (25:57.647)
Strong, right? Strong. OK, let's get into some nerdy marketing stuff. What are you seeing for your clients? I guess, first off, for you guys, when you bring on a client, what are the orders of operations? Are you auditing the channel mix? You don't have to go into the secret sauce, but just for we have a lot of agency owners that listen to this. How do you guys structure your client interactions, I guess?

Joel Padron (26:24.846)
Yeah, I think we do a lot of pre -vetting, which is pretty important. So even before we audit, a lot of times we'll do a preliminary dive into the numbers, honestly. If your unit economics don't make sense, I'm not going to rescue. I can't rescue that, right?

Rabah (26:27.599)
It's super smart.

Rabah (26:40.239)
So well said.

Joel Padron (26:41.646)
So that's one of the big things. It's one of the big things is like from the beginning vetting things properly, because sometimes it's very clear already at that point, there's a red flag. It's like, this is never gonna work. Your margins are 40%. You have to sell. If I were to do a breakeven analysis, which is the second part, okay, I would need to reach this point for you to reach breakeven on marketing spend and agency fees. Comparatively to where you are, is that a big gap? Is it not? That kind of lets us know like, is this gonna work?

Rabah (26:56.143)
Yes.

Joel Padron (27:08.11)
before we even dive into it really. So doing that, I think is gonna help every agency owner. It's gonna prevent, when you say you've got a headache client, a lot of times headaches is because they're not happy with the numbers. So just doing that saves the team a lot. That's, I think, the number one tip and the first step that we really do. Then it goes into like the more technical stuff, right? More technical stuff than, you know, in the meta side.

Rabah (27:13.391)
Yes.

Rabah (27:19.311)
Yes.

Joel Padron (27:35.598)
we'll really just evaluate now fortunately like i've enjoyed how the

paid has really become more of a full marketing, full funnel approach where you need to evaluate everything. Back then it was so, so heavy on media buying that now it's like, we even look at like our audit docs from now compared to back then. It's like the meta portion was 80 % of it. Now it's like, okay, it's like an even amount. It's like, you know, a third of it creative is landing pages, miscellaneous opportunities, CRO. There's so many components that need to all be on point. And that also includes email. So, it's, it's, it's, it's,

Rabah (27:45.167)
Yes. Yes.

Rabah (28:01.711)
Yes.

Joel Padron (28:12.08)
It's one of those things that we still I think is surprising, one of the biggest surprises I've seen agency side, especially coming from brand side, is you would think that all these bigger players know more than you. They're bigger because they're smarter than you. That's rarely the case, if I'm being honest. Obviously, that breaks, you're never gonna hit the nine figure.

Rabah (28:23.087)
Yes.

Rabah (28:28.687)
Yes.

Joel Padron (28:32.654)
range if you don't know what you're doing. So, you know, this is more common in the lower figures, but there's so many basics and fundamentals. I am not one of these gurus that's, you know, here's the new hack, here's the new tactic. I'm a very fundamentals guy.

Rabah (28:34.319)
Yes.

Joel Padron (28:46.862)
And I think there's plenty of opportunity there. So brands like stop trying to always look for what's the new tactic? What's the new channel? What's this? You're usually better off hyper focusing on less and doing more. I'm sorry. Focus on less and do it better. That's always the best. I don't know what you've been seeing on your side.

Rabah (28:47.471)
same.

Rabah (28:56.303)
Yes.

Rabah (29:02.511)
Yes, yes.

Rabah (29:06.895)
No, I mean, the same thing. I mean, the vetting the client stuff is so huge. There's a certain aspect. That's when, in my opinion, you can start making real money is when you can say no. And like I took on clients and almost scuttled my agency a few times when I shouldn't have. But you know, you do what you have to do when you need to do it. But the ability to get into a financial place where you can take on the clients, because I have kind of an analogy where they say you can't out train a bad diet. Like you can't out market.

bad economics. You just can't. There's just nothing you can do. I mean, it's different if you're aligned with the goal. So at my old agency in New York, we had a bunch of VC -backed firms that didn't care about the economics. All they wanted was up into the right hockey stick so they could go raise again. Again, nothing wrong with that, but DTC clients are very rarely that. DTC clients are hand -to -mouth a lot of times. They need to make sure that they're going to hit their numbers. And the worst thing you can do is get into a place where it's

their fault, your problem. And that is just, that is a horrific place to be. Yes, it is.

Joel Padron (30:10.99)
That's the story of the agency game. That's the story of the agency game. And that's a great point, because that's been one of the changes across our DTC industry is just two years ago, was just push revenue. If you can't push revenue every single month, you're fired. That really was how it worked. And that's because they didn't care. Now, obviously, funding is lower. Everyone's focused on profitability.

You've got to factor in all these other elements to it. so that's been good. And I would say like the hot take that I, I've never been a hot take guy, you know, most, most people have like their stance on something. And I would say mine is like brands are still overspending. Like you could make more money. You could make far more profit at lower revenue levels. and a lot of brands are, you know, only now learning that the hard way where it's like, wow, we had to cut. We had to fire people. We had to do this. And I'm making more money right now.

Rabah (30:43.279)
Yes.

Rabah (30:46.831)
Yeah.

Joel Padron (31:01.472)
What so they're learning it the hard way? But I find that interesting so I'll definitely be sharing a lot more like longer form content on on that and even case on like how you how you're able to do it but I would say like that's one of the big things that brands need to focus on and are focusing on more now, which is a good thing is that profitability and not over weighing just revenue push revenue top line all day long, so I'm loving that trend

Rabah (31:01.679)
Yes.

Rabah (31:10.863)
Yes.

Rabah (31:29.007)
I'm saying, man, it's just healthier, stronger, better businesses. And I think there was a bit of a market perversion with all the zero interest rate and really cheap money. And again, there's nothing wrong with that. I'm a huge capitalist, but there just needed to be a correction because there was just so much money floating around. And these people were like features masquerading as businesses or just, you know, ideas masquerading as businesses where you can have an incredible idea.

That's a horrible business. There has to be this marriage between the idea and the value generation and the economics. If one of those three things are off, it doesn't matter. And so I do so much alignment there. And that's candidly what we're seeing a lot with as well. And I think it's healthy because I think one of the biggest advantages of the D2C business model is the cost structure.

I know people doing 20, $30 million with five people team. And that's including the CEO founder. You know what I mean? It's like, dude, this is great. And there is just, I think, an overzealous need of throwing bodies at a problem when you just needed to be smarter about how you approach that problem. And then because you threw bodies at it, it became exacerbated. And so honestly, I think a lot of brands, it's really smart to have an agency for a really long time because that's

One, if you're a big brand, having an agency allows you to have different perspectives that aren't biased by whether it's politics, recency bias, or whatever. It's just hard to have very controversial opinions inside the company. But if I'm paying you, it's really easy to be like, hey, I'm not calling your baby ugly. I'm just saying there's different ways that we can make this baby prettier.

And on the inside, sometimes there's just a lot of, you know, for better or worse, political capital that you don't want to expend, even though you know it's good for the business. And so I think that is also helpful because you can modulate expenses a little easier versus FTEs. Like it just sucks to fire people, man. It just really does. It sucks to fire people. And so having that really robust kind of P &L, I think, is the path. And then the other thing, too, the last thing I'll say on all this is that,

Rabah (33:52.207)
It's very hard to grow exponentially as a D to C brand, especially if you're on the paid media tee, because paid media, by definition, that slope is gonna start to level out and you're not gonna have this exponential where if you're growing from content, if you're growing from, there's other vectors that can keep the exponential up, but if your exponential growth is coming from paid media, dude, that song will end very soon and you need to understand that and figure out how to do that, because the last thing I'll say is,

And I'm sure you guys have dealt with this. You're a bigger brand, so it's not super prevalent there. But when your marketing hits unexpectedly, I've had friends that have gotten fired because they were too good, and then they ran out of stock. And so this D2C brand, basically, if you have, you know, most brands actually, but in D2C in specific, usually have two to four hero products that make up like the Pareto principle, like 80 % of the revenue is concentrated on

three to five hero products type of thing. If one or two of those products go out of stock, like you're fucked. I mean, there's just the, cause the other thing is these are price takers, not price setters, cause they're not big enough. So their factories are, aren't going to prioritize them. They're not going to get this 30 day lead time. You're usually talking 60 to 90 days, three months of minimal cash flow is a fucking death blow to a DTC company. And so if you, a, can't modulate your expenses in a really meaningful way,

Joel Padron (34:55.086)
You done?

Rabah (35:18.447)
or B, you end up taking really expensive money that you really can't even use because you're just actually trying to make payroll, but all the demand that you're using or all the money you're using on demand actually never gets converted because there is no supply to satiate it. So that's one of the, I think, hidden nuances and challenges of a D2C business is actually trying to make sure that your supply and demand are at equilibrium and in lockstep because going out of stock is just an absolute...

death blow and there's really nothing like nothing you do. I mean you can try like pre -orders and stuff like that and there's nothing wrong with that but a three three like a 90 -day pre -orders. It's a big ask. It's a big ask.

Joel Padron (35:59.566)
CVR is challenging, but that's a great call out. We did see a lot of that with the COVID supply chain issues and the other side of the coin, which fortunately isn't as bad as oversupply, right? So we also have brands that now are like, I couldn't raise that next round. How am I going to look this? And you've got a liquidate inventory practically at cost. So it's like, you kind of blew an entire quarter if you're lucky, just converting overpurchased supply into cash again, practically at cost once you like factor in your marketing spend and everything. So.

Rabah (36:09.967)
Yes.

Yaaaas.

Rabah (36:21.455)
So well said.

Joel Padron (36:29.52)
So forecasting is super important, your inventory as well. So yeah, they're pretty fragile businesses in the earlier stages, unless things dialed and that's where like you're saying, I've always said invest typically, I would say A players, right? Everyone's A players. The marginal additional cost that they are is very, is like very minimal, but the skill and knowledge and the amount of money that can save you is insanely higher. So I think that is one of the biggest things.

Rabah (36:37.775)
Yes.

Rabah (36:46.447)
Yes.

Rabah (36:52.463)
Yes.

Joel Padron (36:59.44)
that I always follow, it's why we've been able to grow Homestead fast, it's why a lot of other companies grow fast, is like spending that extra sometimes 10, 20K, whatever it might be on what's really actually a C plus, B minus to now an A, will make you multiples, right? That's where the money's really made, not squeezing, I got a VA for 2K instead of 4K a month. Like, yeah, it's a lower risk, low return, but if you're really trying to...

Rabah (37:02.767)
Yes.

Rabah (37:10.511)
Yes.

Rabah (37:18.991)
Yes.

Rabah (37:23.695)
Yes.

Joel Padron (37:29.36)
of grow, that's the gold end, you know, you're in that growth phase, spend that cash, get someone right, you know, then fixing your catching one mistake could potentially prevent your business from going under.

Rabah (37:40.591)
dude, spot on where Tim Cook has this great line where it's like, why do CEOs get paid so much versus, and so he walks through basically the whole hierarchy where it's like, if an IC makes a bad decision, maybe a day or two of impact. If a manager makes a bad decision, maybe a week. If a director makes a bad decision, maybe a few months. Whereas an executive makes the wrong decision,

You could be f***ed for a year or two. And so having the proper people in those leadership roles is huge, man. And to your point, sometimes it can get spicy and you need to figure out how you can make those economics work. And I'm not saying you should make existential risks and hires. But to your point, there's a funny saying where you don't want to be picking up pennies in front of a steamroller.

Like what's 10 % if the, you know, you're going to pay this person a hundred K and they want 110 K. It's like, if they are all check marks, like f***ing do it, just do it, send it. Like, this isn't going to be, this isn't going to scuttle your business, but to your point, Joel, like it could save your business and all they need is two or three, you know, big saves here or there. And you're just like, okay, I get it. I mean, it's, it's, it is really magic when you think about how much people matter

in a company. I used to be so like not that guy and I used to be so DR people don't matter and like now I'm so like brand people matter. What's happening to me Joel? Who is it you live long enough as a hero you turn into the villain kind of shit what's going on with me?

Joel Padron (39:20.078)
I'm the same dude. I'm the same. I'm always like, yeah, I can work solo forever. I don't want to talk to people. And now I'm literally in the business. That's the most reliant on people like ever. But yeah, it's a necessity and you realize, you know, what can be accomplished with the right people and it's encouraging and it's more fun. You know, I had a lot of success early on solo, a lot of success. When you're, when you're with a team with the right people, you learn and just the wins are more enjoyable. So it's awesome being on a team.

Rabah (39:24.943)
Eh. Eh.

Rabah (39:36.911)
It is encouraging. It is encouraging.

Rabah (39:50.095)
It's so weird because I used to run but also play soccer. And I got more enjoyment. And I think you should figure it out for yourself. But for me, I got more enjoyment winning a soccer game than I did winning a meet. And it was just weird. It was just weird where I was responsible for winning by myself when I ran, obviously. But there's just something about winning on a team. And there's that old adage, you want to go fast, go alone. You want to go far, go together. And

You see, you see guys, I am turning into the cheesy fucking quote book, live, laugh, love. Joelle, help me, help me.

Joel Padron (40:24.814)
We all live long enough like you said until you become a person. They end up being true and we find out why they're true.

Rabah (40:28.111)
Success.

It's the cliches are cliches for a reason. Okay, a couple more questions. Where do you see kind of like marketing going in the space? You have all this AI stuff. Did you see the TikTok stuff with the symphony where you can like basically create really compelling people avatars? Like it's just getting into such a weird wild world where this is the first time because you're still young gum, but I'm old. This is the first time I've encountered technology that

I've been the old man yelling at the sky where it's like, fuck dude, AI is getting to a place and just the development pace. It's insane. Like if you look at mid journey, you look at Suno, you look at like all these AI derivative things, like things are getting wild and wacky. Is there anything like you're looking forward to? You're nervous about like, give me your, your take on kind of the future AI marketing, et cetera.

Joel Padron (41:11.054)
Yes.

Joel Padron (41:28.334)
Yeah, AI is definitely one of the coolest things. Like I even feel that way where I'm like, if I were to go back in time 10 years where, you know, you're kind of fresh and just able to go so deep into something, I would be tearing up AI.

Rabah (41:39.823)
Yes. Yes.

Joel Padron (41:40.078)
I think ultimately enough, I've had some conversations with a few people and it's like, especially in the agency side, as much as people don't want to say it, you need that. And people think it needs to be to create ads or avatars or any of these things. How fast it sent it processes data and like things is mind blowing. So for me, I think for high performers, it's going to be, it's going to be beneficial to them for low performers. It's going to be worse. so you're going to be able to do.

Rabah (41:56.559)
Yes.

Joel Padron (42:10.048)
far more if you understand how to implement it. So for me, I kind of, you know, ended up in ops just from running my own solo businesses. So like we were talking about, I was like, I'm not going to hire people. I learned how to automate and do as much as possible by myself.

Now that you have AI and you can integrate it with fricking automations and stack it and do all these different things. It's mind blowing what could be accomplished right now. Cause back then, you know, I've built stuff that's truly if this then that's or like parsing data, you know, I've done simple things like that before. Now it's just like, you don't need to do that. Like it's so accessible. So I think it's going to be a game changer for pretty much all industries. It's going to be like just knowing how things connect, right? It's how those connect, how you can implement.

Rabah (42:35.823)
Yes.

Rabah (42:46.351)
That is it. That is it.

Joel Padron (42:54.448)
into your systems. So that's where I think it's a gold mine for every industry. Like it's tough to think of industries where it can't benefit from it, right? There's so much efficiency. So I'm excited for it. I'm really like, I wish I had summer break or something like that where I could just dive into AI, because that would be where I'm at.

Rabah (43:04.271)
Yeah.

Rabah (43:10.895)
Let me just play. That's my exact same thing. So I have a thesis on AI where.

I think of it almost like extracting resources. So if you think of AI oil, you need the land first. The land is the data, obviously. OK, cool. We have the land. Amazing. There's a bunch of oil here. Now I need to figure out the frameworks to overlay on it. So is it a standard oil well in Texas? Just put a rig on it. Is it deep sea? Is it fracking? And these are the frameworks that you're going to overlay on the data. And then now you have this raw resource. I need to refine it into petrol.

And that third stage is how am I going to make impact on the business? Like, is it making it efficient? Is it making it more effective, et cetera? And you're absolutely right. I've been playing around with stuff. And I'm the same with you, where I used to do a bunch of like Rube Goldberg shit, where it's like you're connecting all this random shit. You have like a 17 zaps running. Like, it's just absolute nonsense. And now you're just like, so I can just copy and paste this or send it to, you know, chat GPT's AI and tell them what to do. And my

If I was a kiddo right now, that's what I would be doing. I would be getting just so into AI models. And then honestly, and I think the Nvidia has said, the Nvidia CEO said this too, where I think honestly, the biggest crazy stuff is going to happen in like the biological realm, where you can just do so many like analysis things that just would have taken years that are going to take days now.

And you can just run all these simulations. Because that's honestly what makes humans so powerful. I mean, a bunch of things like the thumb, the whole thing. But being able to have a Monte Carlo simulation of running in the future, if I do this, what happens then? If I do that? And you can do that with AI, but at such a low cost. It gets into some really cool, crazy places. And the last thing I'll say on AI is AI is not going to take your job. Somebody using AI is going to take your job.

Joel Padron (45:06.19)
Yeah, that's money. I would say it the same way.

Rabah (45:08.911)
Yeah, I love it. All right, Joel, let's wrap it up. What is your function of excellence? What is excellence a function of?

Joel Padron (45:19.566)
That's a great question. Dang, I could go so many routes. Excellence as a function would probably be for me, it's really just effort really, right? Like making solid efforts I think is gonna be what it is. It's what's always in everyone's control, right? If you're really putting in the work or like asking the right questions, like if you think about it in this technology space, you have access to everybody and everything practically.

All it is, is you taking the action to go out and get it, ask, search for it, and you could have whatever you want. So I think effort is something that I'd always say is, is it, right? All it takes, like we've had in our conversation, is ask a better question. That could be the difference between you making millions of dollars extra throughout your career. That could be the difference between you working at an amazing company or not.

Rabah (45:59.215)
Yes.

Joel Padron (46:12.526)
All it takes is making those small little efforts that other people won't do. And I would really say that's going to be what mine is, just because it's also so applicable to everyone, no matter what it is.

A different life and a whole different trajectory of your life is really just like a few small efforts and decisions away. And that's mind blowing. That's mind blowing to me. So I think it's just always a good reminder for all of us that it's just like, you can have a totally different life just by taking a few different actions.

Rabah (46:31.183)
So well said.

Rabah (46:42.159)
man, I love it. What a way to end. We're all on a journey and you get to decide where your journey goes, which is the most amazing part. Don't be scared that you're the bus driver. You don't want to be riding the bus. You want to be driving the bus. And we have the best bus driver here, Joelle Padrone. Joelle, how can people follow you? Your feed is amazing. The agency you are steamrolling at is amazing. How can people get more involved with Homestead? How can they follow you? This time it's yours, my friend.

Joel Padron (47:07.278)
sure I'm on LinkedIn, Twitter, Jolte Drone and then for Homestead Homestead Studio dot co so feel free to follow me there most active on Twitter so if you ever have any questions feel free to reach out I will make sure I answer so yeah that's that's how to reach me or Homestead if you want to work with us.

Rabah (47:24.815)
Amazing. Joelle, dude, thank you so much. One of my favorite, favorite humans. I need to make it out back to Miami, come see you. I need to bring you out to Texas. We need to bring you up to New York. Are you guys doing anything at the LEAD Summit in mid -July? No? See?

Joel Padron (47:38.222)
but I do need excuses to go to New York or visit you guys.

Rabah (47:42.447)
Exactly, I love it. Dude, thank you so much for all the wisdom, eloquent answers, and you're just a dream. Love you to death. All right, folks, that's all we got. That's another one in the book, so you can go to firm .commerce .com to book a demo so you can start creating funnels, like you create ads and make the money printer go brr. We also have a fantastic newsletter, goes out every Monday, called The Geometry of Growth. That can be subscribed right on our website, firm .commerce .com. Joel, you're the man. Keep crushing it, dude. Ping me if you ever need anything.

And that's it folks. We'll catch you on the flip. Bye bye.