David Nilssen is the Co-founder and CEO of Doxa7, which helps businesses build high-performing global teams in the Philippines. He’s also the Co-founder and CEO of Guidant Financial, which has helped over 25,000 entrepreneurs to secure $6 billion to start or buy a business. David and his business partner received the National Young Entrepreneur of the Year award in 2007 from the Small Business Administration (SBA) as well as seven-time Best Places to Work on Array.
David is also an active investor who has invested in different types of businesses and has been involved in YPO and Entrepreneurs’ Organization Seattle chapter. He is the Author of Making the Jump Into Small Business Ownership.
In this episode of the Smart Business Revolution Podcast, John Corcoran sits down with David Nilssen, the Co-founder and CEO of Doxa7 and Guidant Financial, to talk about building an outsourcing professional services firm. David also explains how he has benefited from Entrepreneurs’ Organization (EO) and Young Presidents’ Organization (YPO) and shares his experience being a Learning Chair at EO. Stay tuned.
Here’s a Glimpse of What You’ll Hear:
- What sparked the idea for David Nilssen’s second business, Doxa7?
- The outsourcing method David used to build his team and how the change affected his company’s culture
- The beginning of Guidant Financial and how it has evolved
- David explains how the COVID-19 pandemic led to the founding of Doxa7
- The benefits of joining Entrepreneurs’ Organization (EO) and Young Presidents’ Organization (YPO)
- David’s experience being a Learning Chair at Entrepreneurs’ Organization (EO) and interviewing Magic Johnson
- What is David most excited for in 2022?
- The peers David respects and where to learn more about his companies
Resources Mentioned In This Episode
- Guidant Financial
- David Nilssen on LinkedIn
- Making the Jump Into Small Business Ownership by David Nilssen and Jeff Levy
- Jeremy Ames on LinkedIn
- Entrepreneurs’ Organization (EO)
- EO Exploration
- Young Presidents’ Organization (YPO)
- Magic Johnson
- Marcus Lemonis
- Lex Sisney on LinkedIn
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Welcome to the revolution, the Smart Business Revolution Podcast where we ask today’s most successful entrepreneurs to share the tools and strategies they use to build relationships and connections to grow their revenue. Now now, your host for the revolution. John Corcoran.
John Corcoran 0:40
All right, welcome everyone. John Corcoran here. I’m the host of this show. Go check out some of our archives we’ve got some great episodes. You know, every week I get such a privilege to talk to CEOs, founders and entrepreneurs all kinds of companies. Check out our Netflix episode, check out our Kinkos’ episode, EO, YPO, Activision Blizzard, LendingTree, so many great episodes. I’m also the Co-founder of Rise25, where we help connect b2b business owners to their ideal prospects. And in this episode, I’m happy to have David Nilssen. He is the CEO of two companies, Doxa7, which helps businesses build high performing global teams in the Philippines and also Guidant Financial, has helped 25,000+ entrepreneurs to secure $6 billion to start or buy a business. He’s received a number of awards including the SBA named him and his business partner, the National Young Entrepreneur of the Year in 2007. And also 7-time best places to work on Arry. And he’s an active investor, has invested in a number of different types of businesses, been very involved in Entrepreneurs’ Organization and YPO, author of Making the Jump Into Small Business Ownership. He’s a member of the EO Seattle chapter and lives in Boise, Idaho.
And of course, this episode is brought to you by Rise25, where we help b2b businesses to get clients, referrals, and strategic partnerships with done for you podcasts and content marketing. Go to rise25media.com and you can learn all about it. Alright, David, so excited to have you here today. You and I share a passion for learning, share a passion for education, share passion for small business. And I want to start with a part of your story. When you had this major lightbulb moment, which actually kind of helped eventually birth a second business, take me back as 2015 2016. And you’re living in Seattle, not the cheapest part of the country to live in. And your costs are going up and up and up. You’re running Guidant Financial, which helps businesses to get funding to start their business. But your costs are going up and up at a pace faster than then even the business can handle. And you have to do something about it. So take me back to that realization that aha moment for you.
David Nilssen 2:44
Yeah, well, by the way, thanks for having me on the show. I’m excited to be here as well. Yeah, 2015. We were, you know, we were getting prepared for a board meeting. And as we were doing that, you know, we started to realize that these trends that we had intuitively known were sort of sneaking up on us, and we had seen, you know, evidence of inside of our business. It was it was sort of like gradually happening. And then suddenly it occurred, right. And we realized that over the last three years, we’re still growing, we’ve been in business for 13 years, we’re still growing at 20% year over year, and yet our labor costs were growing disproportionate to the businesses revenues. Were in Seattle, right? This is a unique animal because the $15 minimum wage started there. The 70k CEO was there. There’s a lot of large companies coming into a relatively small labor pool. And so there’s just this war on talent that we’re causing challenges for a lot of the businesses to compete. And we were one of those that were challenged by it. And so we realized we had to do something differently. And so we we looked at all sorts of options from opening up other offices, which we actually did in Boise, Idaho, where I live today. And then things like outsourcing and offshoring and hiring independent contractors, but we ended up with offshoring. And the reason we did that was because I got introduced to some business owners that had success building offshore teams in the Philippines, where it’s a service based culture, and it’s an English speaking country. And so we decided to give that a try to see if we could find great talent that would help us continue to grow. But do it in a way that would help us manage our costs a little bit better along the way. And so that’s, that’s sort of how we, we were forced to jump into this.
John Corcoran 4:21
Yeah, and we could talk about the pros and cons of different parts of the globe. I’m a big fan of the Philippines, amazing culture, amazing skills, technical abilities, as you mentioned, a culture to serve. I’m curious though, there are different models for outsourcing. Did you hire people independently did you hire an agency at first that that helped you to dip your toe in the water? How did you you know going from maybe all your employees in the Seattle area to all of a sudden you know, having some that are halfway around the globe and you’ve never met face to face or a lot of businesses that scary?
David Nilssen 4:56
Yeah, well, we I will say this, like you brought up with looked at lots of different places from Vietnam to India, China, Kazakhstan, Latin America, and then of course, the Philippines. And we felt like the Philippines was most closely connected to our culture. And we, we felt it’s really important that we knew who we’re working with. So I had actually flown out there multiple times before we made the decision on where to go, and have been, of course, multiple times since then. But we did see decentralize the operation by going down this path. And that just changed our culture. So we’re managing those things simultaneously. She would remind me the question again,
John Corcoran 5:34
well, I was asking about the business model, the model that you have you have an agency that you hired and that you employed them through them? Or did you pay them directly? How did you go about it?
David Nilssen 5:44
Yeah, well, so there’s a lot of different models you talked about. The first one is, you know, there’s many people that will just go online to one of the job boards or through something like a fiber or Upwork, and try and negotiate a deal directly with individuals. That was not the route we wanted to go. I’ll talk a little bit more about that in a second if you’d like. We then looked at offshoring and outsourcing, and the way that I would define the difference is outsourcing is I say, hey, I need this outcome. So I’m just going to give it to you. John has an outsourcing firm, and you’re going to hire the people, you’re going to do the work, it’s going to be your processes, your systems, and you’re just going to deliver me this outcome. I don’t care who you hire, and how much turnover you have that’s on you. The other offshoring was just intuitively just felt right for our business. We’re a service based organization, I wanted to have a direct relationship with the people that are doing and performing the work. We wanted it to be our tools, our systems, our processes, we wanted to have that for our own. And so we decided to go that path and actually work with someone who would be more of the employer of record, but allow us to interface with the workers themselves. So we did Yes, hire another firm to help us go down that path to be that employer of record. And then we sort of helped make some of those hiring decisions along the way and work directly with those individuals.
John Corcoran 7:01
And how did that shift affect your culture? You mentioned culture earlier and you your business has been a 7-time best place is to work on Arry, how did that affect the culture? And how did you maintain it?
David Nilssen 7:17
You know, it’s funny, when we first started on this path, I wasn’t very worried about that, because we had what I would call a celebrated culture people. You know, one point we created this Wordle of all the ways that people described our business internally and family and fun. Were the number one and two things said so my thought was, yeah, if we go and we start working with talent all over the world, how is this gonna impact the culture? And what is going to be the response of the team members here domestically, when they think, Oh, my gosh, they’re trying to bring on offshore talent is my job at risk? So I remember the day that we actually did the announcement, I told them, hey, look, you know, here’s what’s happening within the business. We think this is a core capability that’s really important for every business long term. We want to develop that now and early and really lean into it. But we made a commitment to the workers that nobody would lose their job as a result. And we’ve held true to that this has been a growth strategy, not a cost cutting exercise. So but what it’s done and originally, when we went down this path, what I found is that, in general, people think of offshoring as let’s just find the work that nobody wants to do, or I don’t want to pay 20 plus dollars an hour for and let’s just send it off to this low cost geography. What we started to do is actually move up in the value chain. So yes, we’d have some Administrative Professionals, we started hiring accountants and CPAs. Even attorneys and software engineers, and program managers and project managers, what I found is the further up the value chain we went, the more value we created, and more opportunity we created for our workers domestically. And I’ll just give you one example, to drive this home. You know, we used to have one AR specialist, or CB two era specialists and one decided they wanted to move on to a new opportunity. Instead of hiring one HR specialist replaced a man of hiring a couple in the Philippines and made the one here and domestically a supervisor. So we created two meaningful jobs offshore, and we helped improve or I should say up level of talent onshore, and that’s something that we’ve continued to replicate. And today, that company Gaiden has about 200 workers across the world, and a third of them are outside of the US.
John Corcoran 9:17
Interesting. Talk about how Guidant was formed in the first place because you didn’t intend to start basically a financial services business. You actually were looking at doing a real estate project and ran into frustration around financing.
David Nilssen 9:32
Yeah, so I was developing real estate in on the peninsula of Washington State and a town called Bremerton, they reactivated the Navy base due to the war on terror, but they were lacking infrastructure. So we were going in buying up robots stripping off the timber cutting out a pad and making it available to manufacture home dealers. Well, at one point I was introduced to somebody and they were this is my business partner, Jeremy Ames. And they were they had a real estate business that that cater to helping you Investors find properties, not your traditional buy and sell. And at the same time, we were looking on tape to take on more projects. And so we got together thinking there was a deal to be done. And when we sat with the real estate attorney, they suggested we look at self directed IRAs to fund that investment. And at the time, that was a new concept to me, I didn’t realize you could take retirement assets and invested in non standard assets like real estate. And after helping one person do that, using a trust company out of San Francisco, my phone started to ring with other people who had heard we’ve helped. And the next thing you know, I got people calling me saying, will you help me? Will you help me? So we realized at that point, that was an interesting opportunity to take something that had generally been preserved for high net worth individuals, and bring it to Main Street America. In doing so he realized you could actually invest your retirement assets in things like a small business or a franchise. And that really lit my fire because I’m really passionate about small businesses. And so that’s the business originally started around real estate, but it’s actually migrated exclusively to entrepreneurship, where we help people find the capital they need to buy or start a business. And then we provide services like tax and accounting, payroll and 401k administration, and now we serve not quite 10,000 small businesses across the US.
John Corcoran 11:12
And do you get into helping them to determine what opportunity they pursue whether it’s a franchise and starting their own business or not?