SPEAKER_00 0:01

Welcome to Future Adventures, Kelly McClary. Today's guest is Alan McLaren, co-founder of Strado Regionals, where he helps CEOs and founders understand one of the most overlooked forces in leadership, how they are actually experienced by others. Alan has spent decades at the intersection of leadership, storytelling, branding, and trust, working with executives in high-stakes environments where the room is often making decisions long before the meeting is over. Today we explore why leadership isn't just about strategy or communication, but really about the signals leaders send under pressure and how those signals determine whether people are lying, hesitate, or walk away. Alan, welcome to the stage.

SPEAKER_01 0:55

Thank you. I I think we're done. You said everything I was gonna say, so we're we're good. That was the shortest podcast in history. Interview is over.

SPEAKER_00 1:05

Nice to be with you. Nice to be with you, sir. Same here. Uh uh I'll tell you. Um by by by by way of a designation, I'm a CPA, I'm a C have a whole number of different designations. Um, but a lot of my work has been an intersection of uh of change and transformation. So about three years ago, um I I obtained ProSI, which is a change management designation, not because my aspiration was to be a change management uh practitioner, but because uh change is it really literally everything, and when we talk about transformation or um or or or big programs, one of the most common things that you're told is like you know, leaders are super important. You required like as a leader, active and visible sponsorship. That's kind of the key requirement of a leader, and then it cascades different roles based on kind of the layer of the organization. But but tell me, what inspired you to focus uh on leadership and the signals?

SPEAKER_01 2:09

Well, um, there's a bit of a story there, but I'll try to keep it brief. Uh, we my business partner Leanne and I had a marketing agency for almost 19 years, and uh COVID, we all have a COVID story. We had one, too, so 90% of our business disappeared on that Sunday before everything closed. I remember that like it was yesterday. So we had to look hard at our business and say, was it us or were we not ready for uh something like a pandemic? And it was a little bit of both, but then AI showed up right around the corner, if you'll remember. Yeah, and then we kind of went, uh-oh, I think it's gonna kill our marketing agency. So we moved into leadership branding because we thought, okay, that that's something AI will have a little bit of we'll have a little bit of time with, and then that caught up as well. So what we looked for in this new world, we said in our leadership branding world, we saw we saw people doing videos who were distorted, who weren't clear, and so they were not landing even on video. So if I'm in a podcast and I'm distorted, you're gonna feel from me, you know what, the words are good, but I'm not feeling it. So we we started to research that and came up with leadership signal and said, Oh, there's a whole invisible variable here that impacts every leader, every human actually. We're focused on leaders, and then we kind of moved into the capital market space because he said that's the highest stakes place that this exists. So that's kind of how we came to uh to leadership signal. I'm happy to share more about it.

SPEAKER_00 3:30

Well, tell me more about it because um, I mean, I've always been uh in consulting um or business development. I mean, like what it's with ey, what it's with the lawyer to like what I'm selling to to to customers, what I'm selling to employees, like you are selling, and uh I mean you've been an agency know, you know what it's like. Um the the one thing that puts off a customer is sales breath, right? Like uh so it it it it people judge you not by what you say. Of course, this is really important because um like what comes of it's not as important what comes of your moth, it's what's important what goes into people's ears, right? Like the perception that's created, but like tell me more about like the word that you're doing.

SPEAKER_01 4:18

Well, there's another variable there that's not just the words you say and how people hear you, it's how they feel you used in the introduction how leaders are experienced in high-stakes rooms. Well, what we have found in that world is that pressure reveals uh things that you didn't know that were inside you, and so when we look at you know, the first step in our process is understanding the pressure in the room and anything that impacts somebody's identity, credibility, or authority through a question or a look or ignore, you know, you're in a room and someone's got their phone and they're ignoring you, that pisses you off, and that impacts you. And if you're if you're distorted, it comes out in how you communicate. So that's the first step in the world that we're in. Once we understand pressure, then you go into autopilot. What's autopilot? Autopilot is a response you've been using for 30 years, but it doesn't work because it's autopilot, and and then what happens is the room goes, I'm not sure I'm following this guy, but it's all subconsciously done. It's not I'm making a decision, I don't like Maxime anymore because he didn't say that right. I'm not feeling it, and they shut off like that, and then that's when the polite stuff starts in the room. Oh, that's great, but you know you're done. So that's the work we do is we uncover the invisible variable in that room, which is a distortion based on one of those three things, and then we map it along how to actually correct that behavior, really, not even behavior, it's all nervous system-level stuff. It's very, very deep. And once you clear it, it you start landing in all those rooms. And in the case of capital markets, you know this better than anybody, you know, reducing the amount of rooms you have to be in to invest that to talk to investors is direct ROI. Arguably, arguably, not even ROI, but reduce increasing your valuation because when you're not when you're fundraising full-time, you're not keeping an eye on your business, and that tends to drop over time, and then that impacts your valuation. And so that's the work we do. It's it's fascinating, it's fun, and it's kind of unique.

SPEAKER_00 6:27

I agree. Um it's um this is at the this is at the core of uh of how people show up. Um, and so what are the most uh common challenges or what what what what's what is at the center of how people show up? Because like I mean, it it doesn't matter what assessment you take, yeah. Um they are like it typically asks for your internal assessment and then it asks for an assessment of how other people view you, right? Like and so if you have the delta between how you view yourself versus how other people view it, you try to narrow it down um to to where you want to um but gonna like tell me a little bit more about the word you do.

SPEAKER_01 7:09

So, but what you've described is very valuable, right? But it's all at the cognitive level, so it's okay. I need to be more like I need to be more empathetic. Um, you know, people who aren't empathetic, do you think they can be empathetic if they decide to think about being empathetic? It's what they're you know that it's as humans, we're we're we can learn things for sure, but the reality is you are who you are. Yeah, I happen to be a heart-centered leader. Can I be an ass when I need to be? Why I need to make tough decisions? I can't, but it's not my strength. My strength is in leading with heart. So those things are great, but what happens is people feel you before they hear you. So that's the challenge, is you can't actually think your way through this, or you've heard people say, Oh, well, you're not being empathetic, use an elastic and smack it on your wrist so it reminds you to be well. When someone challenges you in a room, let's think through this for a second. I'll give you the simplest example. Uh, we'll use an example of a strategy session that a CEO is leading, right? CEO's leading it. First things out of their mouth is there's no such thing as a bad idea. I want everybody to participate, and we're gonna have a great session today to build our plan for next year. What happens in the first 10 seconds? Someone opens, hey Joe, I have an idea. Oh, we did that last year. Um, boom, we're done. So, what happened this year? So the CEO had some distortion that said, you know what, I said it, I'm uh, but I didn't really mean it. And I didn't mean it because that idea was my idea last year and it didn't work and it hurt me. So your question just impacted my credibility and authority, and you didn't know it. Yeah, and then the challenge becomes that human in the room is not opening their mouth anymore. The rest of the people in the room are not opening their mouth anymore, and then they're gonna after the room's over, they're gonna talk about it, and your reputation as a leader just got smashed with one comment. Here's the challenge that all leaders know this is not easy stuff. Leaders, leadership, yeah, it's easy. Let's read 5,000 books. I've read every book on the planet, but what we have found you have to do all the things that they talk about empathetic leadership, listening, strategy, careable people, all those are important. But if you don't land in the room, it doesn't matter. So that's what we're talking about is is is learning corrective behaviors, and that's the work we do to clear distortions that you've had for likely 20 years in your life, and uh the impact is mass is massive because you don't even know, you can't even name it oftentimes, what happened in that room. So that's that's kind of the challenges that we face. And if I can give you one thing, because you started the question really powerfully. The number one problem is if someone can't see it, they don't know it exists, it's impacting everything they do. How do they fix it? They they can't if they can't name it, right? They just know something shifted, okay, right? So then the other part of that is they often say, Well, it's the team, it's them. I have some news for you. It's you, it's always you. As a leader, it's always us, and so that's the biggest challenge we face is leaders, leaders who say it's me, we're that's fantastic. Leaders who say it's them, that's harder to work with.

SPEAKER_00 10:34

I completely agree. So a couple of thoughts come to mind. Um I mean in change management, there's the there's the odd car model, which is awareness, desire, knowledge, ability, and reinforcement. And this change uh flow breaks at the weakest point. So it's where wherever it's taken. So if you have high awareness, like a leader, I I have awareness I need to change. Great. You have the desire. If you have the desire, you pass on to the next gate, you have the knowledge. Um, so I completely agree with with with with with your comment. The other thing um again, like I I was I've been part of some of the leading organizations that worked nothing but 20 top 20 TSX and EY and Deloitte. And so one of the assessments that I I personally found to be really effective, I I don't remember what was the name of it, but it was the colors the the blue, red, yellow, and green. Yeah, yeah. And what I found this to be powerful for not necessarily for the assessment, the assessment is very similar to other assessments. Um, and and and we talked about the empathetic. The empathetic in the colors translates to to green, like show me that you care. It's not that you don't care, you just show me that you care. But what I found powerful about this is I I don't know if you've seen that they had these like rubber foam cubes or or kind of Lego blocks looking, and you put them in your desk and you set them in order. And and uh if if everyone in your organization has taken this training or this assessment, you kind of immediately build a mental map around what this person is like. If they're like fiery red, if they're like um if if they're blue, like is like okay, this person needs for authority, they want the details, they don't care about emotion, like uh just like that's different than somebody that's showing up as green. So I I I completely agree with everything you were saying, is that the the first step for a leader to change is understanding how they show up, yeah, and having that worse the desire to change.

SPEAKER_01 12:43

I couldn't agree more. The and if we think about it in the in the context of a capital room, let's think of where someone is either an MA or an investor, they don't often have relationships with the people on the other side, right? So they're trying to build trust quickly, and you have been in those rooms on both sides of that fence, and you see how quickly trust is broken, right? Like like that. One statement, one comment, because they're testing you as much as the idea, of course, because they're gonna have a relationship with you uh for five or ten years, depending on the structure of the fund. And they want to know I can be with this person and I trust this person. Not that they're not trustworthy as a human, meaning they do what they say and all that other stuff, but I'm trusting them with five or ten million dollars of my money, and and when the pressure in the room hits and they start getting defensive, you've seen that, right? Or they start over-explaining, or they get really fast and they start talking like that. Yeah, what happens subconsciously is people are going, What's going on here? So even if you're consciously aware, I was talking, I did a webinar yesterday. One of the questions was brilliant. My CEOs are highly technical and they get in trouble halfway through the pitch. You've seen this, right? Because they're so technical, they've lost the plot. He says, Do I tell them to go get a glass of water and breathe? No, they're gonna go back right to where they were because they don't know any different. Yeah, so what I'm saying is all of those things, practicing, pitching, knowing who you are, knowing your communication style, all important. Unfortunately, in this world that I live in, your nervous system's running the show. Yeah, running the show. So if you don't clear the distortion, it's coming out, they're feeling it. And when you think about it, you say, Well, why does it take 40, 50, 60 rooms to get an investment? It's because you don't land in half of them, you're not connecting within half of them. So you could reduce, we believe you could reduce it by almost half the rejections that you have because you'll land in every room, then it's about fit because you'll have trust. They'll go, Wow, he answered that question really cleanly and good. I just think it's the right fit for a business. Great, that's the game. But if you don't land, you're you're asking for double trouble. So that's that's where we where we uh really enjoy the work because when someone clears a distortion, it's a visceral reaction for them. They actually go, it's something very deep psychologically. And uh when we see that happen, it's it's just magic. And and the important thing, Maxime, to understand is when you have a distortion like we're talking about, it carries from room to room, not just investor room, room. And we get texts from the wives going, What did you do to Sid? Because it transfers to how they react in their personal lives. Yeah, so it's it's uh it's fun stuff, yeah.

SPEAKER_00 15:36

Uh I a hundred percent, a hundred percent. Um, we we see this all the time. Um, you can tell when somebody has a pep in their step, yeah. Um it it's kind of interesting. Like, I think it was last month I wrote an article around what happens when founders get defensive. Bingo it ultimately leads to exactly the outcome that you're describing. But I want to unpack the idea around how do you clear the distortion? How do you become viscerally aware of your distortion so that you can overcome it? Because like walk me through it.

SPEAKER_01 16:13

Here's the depressing part uh, I can't give you a tool to go, hey, go do this. That's unfortunate. There's no silver bullet here. So the and and it sounds self-serving because you know that's the work we do, but I want to be very clear that that's not what I'm doing. Awareness is step one, but solution doesn't happen on your own. So that's I'll just park that and I'll give you what we do. So the reality is if we think about the first step in the process, is uh what we do is a 90-minute interview to uncover. We all we do, we have very structured questions that uncover the distortions in the high pressure rooms that you're in. So, Maxime, if I was working with you, I'd say, okay, tell me about the high pressure rooms you're in. And you'll say, Alan, the capital rooms are really the important, and the MA rooms seem to be the one that I'm in the most on both sides of the fence, either connecting or doing that. Great. So those are the two high pressure rooms that I want to focus on. Great. And then we'll talk through them. And we're gonna uncover that you get really defensive in MA rooms because you don't feel you belong. I'm not using you as an example, you don't feel you really belong in those things. These are people that have raised hundreds of millions. Maybe you've raised five million. I don't think I belong. That stuff comes out, so we uncover that distortion. Maybe you see questions that challenge the numbers as disrespect because you maybe have done four exits and you've done well. So a question comes out that way. So we uncover that first, we map it out, we map out what we call your distortions or your shadows, and then we go, great. Now we have a plan. We know who you are, and then we walk them through and say, okay, the actual, for lack of a better term, coaching sessions we call uh corrective sessions. That's where we get into the technical stuff, where we identify the room. Once we have the room, we identify now that we know the distortions, we actually start going through it. And maybe I'll tell you a story that might help you illustrate what happened to me. And it's one that I have to be vulnerable about, but I will be vulnerable for your audience. And I was in a room with 60 CEOs about 15 years ago before we started this work. And what I knew about myself is I don't like when people yell at me. You can tell me I'm an idiot, you can tell me I screwed up, just do it at a normal volume. You yell, I or at least in the past, I match the energy. So we're in this room and I'm presenting and it's going great, everybody's loving it. I'm getting an audience. One guy starts yelling at me, screaming at you this and you that, and blah, blah, blah. Well, I matched his energy. I'm surprised we didn't come to blows. I kicked him out of the room. Can you imagine the tension in the room with 60 CEOs after that exchange? So that's what happened. The problem was I saw that as good behavior for me. I took command of the room, I was in command mode. I did what I was supposed to do. I took control. That was my perspective then. Working with my business partner, Leanne, she says, so this is the work. So now let's walk you, let's go back to that room. And by the way, I'm telling you the story, I'm feeling it in my chest. Really feeling I'm back there now talking to you. You notice my I got more aggressive. That's what the nervous system does. So the work is then we come back and Leanne starts asking me questions and starts reframing what actually happened in that room. So let's reframe the conversation. Was he yelling at you or was he angry with who you represented? Yeah, he wasn't really yelling at me. He doesn't know you. How could he be mad at you? So he he was mad at something else, and he had an inability to communicate. So his frustration came out in yelling, and maybe something bad happened to him. So let's re-let's re-anchor that in a different way. And so, what I'm describing is very short. This would go over hours of conversation, of course. Ultimately, now I've look at that and go, I so I've cleared that distortion. So if anybody yells at me now, my reaction is automatic. You know, Maxim, I can understand your frustration. Can you tell me more about why you feel that way? Because I'm not feeling attacked anymore. I saw his attack as disrespect, which is a bit of a theme for me that I see in different places. You ask me a question I don't like, I see it as disrespect subconsciously, not consciously. And that's what comes out in a look or a come on or a come on, that's a stupid question. And we've all done that. So the work we do is to clear the distortion. So now people can yell at me and I will react appropriately for the room and control the room. So trust is continuing to build, and they'll go, that guy got yelled at. Look how he handled that. So that's the work we do, and it's very technical, and that's all the IP that we built. But essentially, it's a conversation to clear a distortion. And one example, really quickly, one of our clients had a distortion that was really, really bad, but it meant he kept going, he was a visionary leader, he kept going from altitude, meaning he had to stay at the CO level. He just kept going, you guys don't get it, I'm gonna do the work, which was killing him. After the work, you know what he did? He went and bought a model airplane and left it in the back of his thing, and that reminds him that's the anchor to stay at altitude. Someone comes in with a problem, I gotta stay at altitude. And now he just looks at his plane and boom, it's he doesn't have to react. So that's that's the fun work because it stays forever. And then the next time he goes into a room with his team or with an investor or with a customer, he's not having that distortion anymore.

SPEAKER_00 21:37

I mean, the the key to change is is habitualizing the the the knowledge. Um I couldn't give more. I wanted to unpack something because as as you were talking, I just wrote it down. Um, kind of circuit 2015, emotional intelligence became invoked. Like everyone was talking about EQ and emotional intelligence, how EQ is is more important than IQ. Um and then a whole sleuth of authors came out with some form of like as a leader it's important to be vulnerable. And um you talked about vulnerability. But in in many ways vulnerability is showing you weakness or it's oversharing or it's like so help me square up like um the the leadership signals sure how do you show um command and control or how do you how do you like because the key is to give confidence what is to employees that you're in control not necessarily to be command and control but to give the confidence that that you're in control or the companies in control or the situation is in control and then being vulnerable.

SPEAKER_01 22:51

So the way that I look at vulnerability is don't you so I just I don't know you or your audience really really well and I just told you something deeply about myself. People are either going to say he's an idiot or oh my god is this the kind of guy he is and the answer is I'm gonna be congruent with what I am because I told you I'm a heart leader. Yeah some some uh pe firms that hire CEOs want an ass they want a spreadsheet assassin they want someone who's gonna go in and tear it up and in three years they want to flip it okay that's not me so what I what I look at with leadership EQ is just an ability to communicate and humanly with other humans simple right and it's the ability as as I don't know it was my Angela that said people want to know you care right before right so that gold whatever I forgot what the whole thing but the point is we're dealing with humans the business is a game it's just a game it's metrics and numbers and marketing and tactics and strategy businesses aren't trusted but people are or not we're not so eq is just a style but every leader should have eq if they want to connect with people on their teams so let's park that vulnerability is one way to trust because if you are vulnerable with your team your subordinates they go he's human because guess what leaders don't know everything in fact they're supposed to hire people smarter than them right absolutely if you hire people smarter than you and you're vulnerable then what happens you're building a culture of people who are going to be vulnerable and they go it's safe here I feel safe because one of the things that we do we talk about in the room do you feel safe in that room the example I use with that CEO who said it's a bad idea I don't want to talk about that nobody felt safe in the room after that and the next time they have an interaction they're not feeling safe yeah what happens when you're not feeling safe it's one of Maslow's hierarchy of needs. You need to be safe everything in a relationship in a friendship in any in the environment humans need that sub we need that safety so to me vulnerability is about being human and when you don't have that then people don't trust you because you're hiding something right so I think vulnerability can good command and control is is a false game it's just a false game people look at you and trust you and and go this person is smart enough and they've empowered us to do the work what do you you're building a good leader builds leaders that's what they do they build good leaders and they build the great culture to me a good vulnerable leader still has a side to them that goes now I'm gonna use my authority you have authority all the time you need it you use it when you need it and when you're in the decision room and everybody's waffling okay guys this is where we're going the ship is sinking I have no time for this go grab the lifeboats you go do this you go do that that happens sometimes that's okay if that's all you do then do you think your leaders are being developed no you want them to go I got the lifeboats you handle the clearing of the water make sure the women and children off first whatever so if if your team is doing that isn't that better that's the magic between so vulnerability just allows humans to connect and in our work really we don't deal with it at that level because that's great leadership you can have all of that and still not land that's the problem that I'm that I'm trying to uh surface here you you should have all those things excuse me just grab some water in a worse you should have all those things but you're still going to have these distortions that impact what you do so the example of me yelling uh in that room uh I would carry that into my room uh with my team here if someone ever raised their voice at me because I made a mistake or something I would match their energy and go into command mode and a lot of CEOs do that by the way I still have a distortion where if someone doesn't do the work I will say something like fuck it I'll do it excuse my language I'm just gonna do it that's not a good way to be a leader but we all have distortions that come up all of our lives and so it's the idea is to clear them and do them and we're all a work in progress including me for sure I mean I absolutely love what you're saying like for um a number of years he used to have a mentor and shout out his name is Jared Sprat um and uh he said one thing that absolutely changed my way of thinking as a leader at that time was leading a team of 20 people um he's like Maxim how how do you know if you're winning I'm like well I don't know we do if we deliver this if we do this he's like no like what do you mean no Jared he's like you know that you're winning if you walk through your area and the team is high fiving each other because then you know that the work is being done even if you're not there there's chemistry there's gelling and so the outcomes are a byproduct of of the team so he's like he's like you should never talk about what you have done you should talk about what the team has accomplished what's the chemistry what's the energy like what is where are they going um like I this was probably the first time that I heard or heard something that I was like okay this is like this is these guys really literally changed my leadership style yeah it's you know it's magic and then I always when I coach leaders I always talk to them about really two things when you have success it's the team and when you have failure it's you a hundred percent that's it so now again back to your team and the other thing that's really good about what he described was there's no fear of you you're one of the team you're the leader of the team but they don't get fearful when you oh Maxim's here Maxim's here I have to pretend I'm working I don't want you to pretend I'm working I want with my team we're all remote and I say to them if you have to go to the dentist go to the dentist get your work done you don't have to they still tell me I got a bug I said just go I'm not in your house every day do the work you know what you have to do we have a a morning morning huddle get your priorities done if it takes you six hours or eight hours or 15 hours that's up to you live your life deliver what we've asked you know what that does for a team trust so when they call you and say you want to read this post I did I I tell them I don't want to read the post you're the expert go do it and and you know so that's what you that's what that guy was telling you about absolutely deliverables happen and people are happy you've built the culture that's all the magic and uh but you can break that in two seconds with a stupid comment and that comes from your that that I've done and every leader I've ever talked to has done and the idea is I don't want to do that again if I make that mistake because you will because that's what carries from room to room right yeah yeah um I I couldn't agree more so so kind of like thinking about what how leaders show up in the rooms you you often speak about leadership signals what are what invisible signals the most leaders unintentionally broadcasting when it when they're in those proverbial proverbial rooms well you know the the manifestation is in the opening you use the word trust right so that's the game we're playing so but every leader is different right so you and I would be different uh in terms of the distortions we have they're just based on could be triggers could be trauma could be something maybe nobody talked to you when you were a kid maybe you were adopted like we don't get into trauma but we trace it back to a place where you might have recognized that. So so the first thing is when a leader what what happens in those rooms is all the things you mentioned let's check the boxes and say important EQ vulnerability listening all those things are important and they're table stakes to me. So those are table stakes you don't have those then what we do is not going to help you as much because great you'll land in the room but you're a crappy leader. Okay so you have to have a little bit of both it's kind of like you have to have a cake and you have to have all the ingredients that are proper in there to make it all come together. And if you forget something like baking powder then it may not ride. So what we're talking about here is those leaders at the end of the day when they're incongruent and they don't realize that everything coming out of their mouth either breaks trust or breaks safety because guess what as a leader here's the the truth that you know but you never think about everybody's watching every single move every single gesture every single touch every single look that is the responsibility of a leader you know that and so when you walk by and talk to uh one of your employees and tell them something like really appreciate that job you did and someone else hears that and it's sincere what does that do that's outside the room right inside the room the same behavior will happen because they trust you they trust you and they feel safe then anything can happen that you described in your team it makes if they didn't trust you you can't have high fives and high spirit because it'll be oh what's he gonna say to me now right he's a he's such an ass when it comes to these projects he's all over me all the time he's micromanaging everything I do so every leader is different for sure but when they're in those rooms and specifically in capital rooms when they're in with people they don't know yeah that's what I say trust is broken in one comment in one defensive reaction in one challenge because that's an adversarial relationship by nature right you're giving me money I'm gonna beat you up because I want to find out who you are I want to find out the real behind the scenes human that we're gonna work with when stuff hits the fan because it will it always does what happens when that happens my dealing with someone I can trust that's the game we're playing in those capital rooms where investors are actively challenging you and if you're not honed that's why you have to take 40 50 60 meetings because you don't get you don't land in every room so that's what really happens that's what happens I mean for me it's uh um just just to be able to um relay this to to to everyone in the audience to me probably the most the the best example that comes to mind right away when trust is broken is same alpha and open ai right like when he got by the board and what was the comment that they used um he i i i don't remember how it was framed but it was essentially he cannot be trusted he cannot be trusted he cannot be trusted that was the reason like i but i can't remember what was said he was lying or something he cannot be trusted isn't that that's the game we're in though but isn't it the life game we're in like you and I have just met right we start talking about doing some stuff together if we didn't connect on the first meeting we wouldn't have this and we won't have what's coming later so trust is the foundation of everything humans want to do because we get screwed a lot so when you find people that are have integrity and that are aligned and and and people you know you want to deal with you say those are the people I want in my life because good I'm too old to worry about working with idiots I don't want to work with idiots I only work with people I can trust because if I'm putting my them in front of my customers I'm putting myself in front of them so they have to be they got to deliver they got to have the same empathy they got to care as deeply as I do that happens with your employees with investors with your spouse with your kids it's all the same game do I trust you and do I feel safe if you do that they listen to you then without that they're doing this they might be polite you've been in those rooms right yeah I don't like this guy I don't like Sam Altman he's full of crap yeah people get CEOs get fired in board meetings because of that behavior oh 100% a hundred so imagine you're trying to raise five ten twenty million a hundred million uh that's why you need to go in 50 60 rooms you don't have to but that's what ultimately happens today yeah yeah I mean I I've been I've been blessed in in my career to to to to be in a lot of board meetings um yeah in in camera sessions just with the audit committee or the board um and what I can tell you is that the board meetings rarely surface anything that the board members don't already know yeah um I've we we've we've had um board members that could openly walk the hallways and just go and pick uh a leader and just hey let's go grab for let's go grab a coffee um but it's really the life of a CEO is directly correlated to how much trust they're able to instill in the minds of the board uh absolutely yeah 100% and and it's the and the board at the end of the day you're that's who you report to right that's your boss that's who fires you and fires you absolutely fire there and I I have a story of a a multi-billion dollar CEO was telling me a story that when I shared with him what we do in leadership signal he went oh my god I experienced that exact thing and I said tell me about that he said and I can't I want to reveal who he was but he was a big time CEO very well known in Canada yeah and he said I was defending the numbers because consumer spending was down inflation was up everybody was getting the same hit and it was hitting our business in a big way and I was getting defensive and getting angry with them I almost got fired at the end of that board meeting this is a guy who grew this business took them out of the crap but almost lost it all in that quick of a second because they said he changed what happened he was never this guy before but that was a distortion he was going wait you're attacking my authority and my credibility to do this work that's what was happening subconsciously so he says I now have to be more mindful he's got to work with us to be able to get that distortion cleared because it's gonna happen again because the economy is going in a tail again so you have to make sure you don't defend yourself in that way but I I just want to double click on this so big public trade company I'm not gonna say who they are I I was working with them and so I was walking by the CEO the CO and and I literally said about 15 feet apart and and so I was like um hi insert name um how did it go today?

SPEAKER_00 37:41

Because it was the board meeting he's like I survived in that corner and I'm like okay that's not a good uh testament to what happened in the boardroom and sure enough that company got sold not even a year later um so so there's the distortion obviously there was the the the fractures in in the trust were already occurring yes but I was on the inside he was talking to the external stakeholder so you can work on fixing the distortion but how do you fix the things that happen within the company in order for you to instill confidence to the broader organization that you have things under control.

SPEAKER_01 38:23

Yeah so at the end of the day right the that's why I said you have to check the boxes of of leadership you you have to be competent right at the end of the day you you can be the nicest human being and the kindest leader in all kinds of EQ but if you're not executing at the end of the day nothing matters right so let's be honest right and in fact execution especially in the PE VC world is much more important than are people happy right because that's the nature of a VC or a P firm or even a family office is I want to drive my investment up I'm gonna double it triple whatever the number is that's that's why they exist. So but if it's a perfect world here's the magic that we've seen you are a VC you have a portfolio company let's say that portfolio company's done well they're going to raise a fund again but they're not going to raise it from you because you've already exposed something to them go get some money to to de-risk us a little bit so they want those people to do well. So to do well they have to land in those other capital rooms and they have to have happy business stories. So it's incumbent upon the first one in the seed or the series A to make sure their portco is well positioned to get the next raise because that helps the whole ecosystem and everybody rises and everybody makes money so you still have to have competence if you're not a competent CEO all this stuff doesn't matter. Yeah competence first great leadership part of that competence landing in the room well if you're not landing with your team execution doesn't happen that's where you have decision drag and meetings in meetings and all that crap that you've seen wow what happened why I thought we agreed on alignment and clarity it was all going to be this why did it take six months to get to that place? Yeah because there was a distortion there that didn't land so you have that side of it and of course it's the same thing with external stakeholders they they're being communicated what you're doing if what you're doing is not working it doesn't matter on the other side it's uh I I I completely agree with you I've I've had an executive coach and I've been on the other side for many um interviews when executive coaches have been interviewing me interviewing me for uh leaders and what I can tell you is again that that's based on their framework technical competence is absolutely a must it's foundational you have to have it because everything else is dependent on correct but percentage wise it's only 35% isn't that interesting 65% is all the other stuff that you focus on yeah you know so one third versus two thirds you know it's interesting you know you've we've all heard um the old adage that you know when you're in a presentation it's uh body language and words and so much of your presentation the majority is all the unsaid stuff okay because our brains are designed beautifully right our amygdala brain our dinosaur brain is designed to kind of scan the room for safety right that's what it is and they're making decisions about you before you open your mouth okay before you open your mouth they're going uh not sure before so Sam Altman walks into a room but after that board meeting he's already plastered with not sure about this dude yeah he can build a nice product but is the leader we need to take us to the next level okay all subconsciously so that's the challenge is that are you doing that as a leader today or um as you move into a new world where you're now distributed with now 10 000 employees that's different leadership isn't it than running 20 people or 30 people that's that's a lot of a different world so you have to have trust built with the team all the way down so then executive team becomes more important because they're the ones running the each of the silos that are there. So it's it's complicated stuff but competence it's really interesting that it's only 35% but it is a table stake if you're in competent if you're incompetent you shouldn't be a CEO.

SPEAKER_00 42:24

You need to have competence then all those other things make you an amazing leader and performance makes you everything else and then everybody wins when you have performance and happy teams but we all know the truth that's really hard to do it's really hard to do completely agree with you and uh when when it comes to this what what I find is you have to um you cannot like I mean you said it you have to surround yourself with uh with smarter people than you 100% agree with this um Scott Galloway famously says like uh greatness is in the agency of artists it's not kind of like you cannot accomplish if if things are dependent on you to lead the to to to build the organization or build a product build the outcomes you're never gonna succeed like you have to have that trust with with your team for them to execute because that's where the the greatness comes from so I completely agree with with with you there and you cannot I mean Harvard has the the the famous article around monkey on your back you cannot take somebody else's problem and put it in your back and you all right I don't know how to do it. I'm just gonna go fix it. Sure you can fix it the first time but that's like you immediately become the bottleneck you immediately become the limiting factor but I want to I want to go back to to trust and human nature and and ask you because you you talk about that every room is asking four questions of a leaders of a leader. So can you walk us through uh what those questions are and why are they unique Universal.

SPEAKER_01 44:01

Well, the back to the first question is is he safe? If I do I feel safe, right? So that's the first question. I don't have all of them in front of me, but the first one is do I feel safe? And then that's the one that I talked about that people make a decision subconsciously, right?

SPEAKER_02 44:14

Yeah.

SPEAKER_01 44:15

Because of I, if it's so if we're dealing with a capital room where you're getting investment and they don't know you, they're making that decision. And I think it's a higher level question is do I trust this human? Do it that that's that's the subconscious decision in that room. When you're talking about your executive team, uh it's a little bit different. So safety is always on display because this human can fire me. So do I feel safe in that room to speak my mind, even to challenge him or her, uh, and and still feel safe. So that's kind of the universal piece. And if I keep it in capital room space, it's always about trust. Then they make psychological decisions that should I stay, leave, or just shut down. All done without a conscious. Will I stay or will I go? No, they're shutting down, and that's when you see polite nods. Oh, yeah, that's really good. This guy, no, I'm sorry. I've made a decision already what I'm gonna do. At the end of the day, those, and I don't know, I don't remember the two other questions, but off the top of my head. But at the end of the day, those are the two most important ones. Yeah, because once you have those two, then you have trust. And if you have trust, you have open communication, and people feel the ability to say, Isn't it amazing when I have nobody on my team that is fearful to tell me anything?

SPEAKER_00 45:32

Yeah, right?

SPEAKER_01 45:33

Isn't that good? Because you're gonna get the truth, unvarnished truth. They may not know everything, so you have to now help them understand the fuller picture if you don't agree with them. But I'm learning from them every day because they're in the trenches, they're doing the work. And the one thing that's so important that you mentioned, but I want to reiterate it, it's so important. You know, if you're in any business, if you're the key, then you're the bottleneck, and you're not only the bottleneck, when you want to sell the business, you're the problem because your valuation is going to go down. If you're the one that they need to hire, you know, outside of an earnout for two years. So when you build a business that can run without you, that's when the real money starts to happen. Doesn't matter how big you are, so it's really important to build your team because that business needs to run without you. And and if there is an NMA, you want to be the CEO maybe of the combined entity, so you're always competing for space. So everything we're talking about, when you do it right, the good things happen out of that because you're the better leader and you're the you have built the team properly. So that's how to me all those things kind of come together.

SPEAKER_00 46:42

I could not agree more with you when we're doing cell side work. The two top reasons that drive valuations quality of earnings, key man risk, or key women risk is like you cannot have this because the organization has to be self-sustaining, correct? Um without the founder or the leader or whoever is it is is it the home or maybe it's a technical person. Yeah, um, but I wanted to ask you, kind of speaking of like the the leader, what changes or what needs to change for a leader of a 10-person organization versus a leader of a hundred person organization versus a leader of a thousand-person organization?

SPEAKER_01 47:28

So simple when you're in a 10 or 20 person organization, it's uh it's an entrepreneurial venture. You are in everything, you're working in your business and on your business. So let's be honest, you can't you can't be a true CEO and start delegating everything because you're too small. Yeah, you need to know every little part of that business. So I think that's clear on the smaller side. The the next transition, of course, is now okay, now you're hiring people. So now you have maybe a VP of sales, VP ops, and a tech, a CTO, or something like that. So now you got to learn to delegate, right? So now you're maybe 50 or 100 people, but now your executive team are doing more, but you're still very visible because the people need to trust the leader because otherwise they'll go, Where is he or she? I don't see them a lot, uh, they don't come and talk to us. You can do that at a at a medium level when it gets bigger, you're the band leader. You build a great band, and your visionary, your public visibility, you deal with the board, you deal with public markets if it's public, and you deal with your executive team, and then the and what a lot of CEOs miss, unfortunately, is they have an opportunity to deal with thousands of people, they just can't deal with them one at a time. So they need to find a way to communicate the vision of the organization which supports the executive team, the board, and all of those people. So it just changes, you get pulled away from the core of the business, and you you work on the culture, the values, the vision. That's the true world of a CEO, and everything is delegated. Your desk should not have a monkey on it, to your point. There should not be one monkey on there. You're thinking strategically, working with the board, working your executive team. That's the difference for me.

SPEAKER_00 49:11

I couldn't get more, and and this is important from change management perspective as well. In change management, the most important person for an employee is the is not the leader, it's the immediate supervisor. Correct. Because they're the ones that are shaping the world. Of course, there's the macro environment in a company, but there's the microenvironment within a team, and kind of like what does the leadership say? So if you're kind of thinking about the the cascading of message, sure you can have a leader of a thousand-person organization kind of set division, the strategy, and things like that, like try to lose part of the organization, but it's kind of like how does it it it it's all based on trust? How does this message uh translates down to through the ranks, down to the the person that's receiving a message?

SPEAKER_01 49:57

You know, I I was uh I know we don't have a lot of time, but I'll just give you a quick story. When I was uh in Quebec, I'm originally from Montreal, and I went to a turnaround really bad situation. We were two out of ten on the survey, like two out of ten, that was brutal. And what I did was because it was broken, I went and met uh every team in nine offices, and I talked to them. And the reality was afterwards, the trust part was I listened to them, and then when I came back, I said, Here are the ideas I've I'm gonna implement, and here's why I'm not implementing these other ideas because of this or timing or funding or whatever it happens to be. Do you know what happened over time? They kind of went, Well, at least somebody listened, and they didn't it didn't go into some black hole. A year later, eight out of ten, only because of trust. The business still was in trouble because it came in, it was half of it was losses. You know, either even that was terrible. But but then it started to turn because people were believing that we had a chance, and it's all based on communication, honesty. Listen, we're not gonna do that. This is why. Oh, at least I now know why. Yeah, you can do that at any size organization, and at the end of the day, that's back to that safety and trust conversation. It's always that raising capital, MA. If you don't have trust, nothing else matters, nothing else happens. And when you when you distort in those rooms or have masks or become command mode when you get upset, then you're breaking trust, and you're breaking it on all sides of your life. That's where the work we do comes in. When you do that, then things you land in better rooms, so all things become better, decisions go better, fundraising goes easier. All those things start to happen because of that work.

SPEAKER_00 51:43

A hundred percent. I know, Alan. We're almost at time. I like to close the conversation, and by the way, I have tremendously enjoyed this conversation, but I like to close conversations with uh with a choice of of a question, and you can choose which one to answer.

SPEAKER_01 51:56

Pressure, pressure in the room, baby.

SPEAKER_00 51:58

It is pressure in the room. I've given you optionality. I I mean there's this choice theory which says that like if you have too many options, then it actually shuts down the nervous system. But out in this case, I'm giving you only two choices. Okay, what's the best advice you have ever received, or what's the kindest thing someone has ever done for you? They go together very much so.

SPEAKER_01 52:25

Best advice, and you know what? It wasn't advice, it was how my mom uh lived with us. Be kind. There's no there's never a time in your life where you don't have to be kind. I have fired, unfortunately, thousands of people in my life, and unless they stole from the business, I could be kind. If they stole from the business, then bad Allen came out. But if they but being kind at every turn, to me, uh, people appreciate that opening a door, being nice, helping out. That's to me, that's the best way I live my life, and uh I don't know another way to do it, and that would be my advice to anybody because it comes back a hundred percent, let me tell you. It's good karma, good karma, it's real, yeah.

SPEAKER_00 53:15

Yeah, Alan, it was an absolute pleasure having you on. Uh, thank you so much for coming on the Scaling with Clarity podcast.

SPEAKER_01 53:22

I really enjoyed it, Max. A really fun conversation.

SPEAKER_00 53:26

I truly enjoyed it too. Thank you.