Callan Harrington 08:55
It’s funny, I think those early careers don’t get talked about enough. What I mean in particular are those early careers that nobody is going to put on a resume anymore. I highly, highly, highly doubt you're going to put anything like early retail experience on a resume, but I learned so much from working at Dick’s Sporting Goods that I still use to this day. Now, one of the things I’d love to dive into here is—you brought up something, and I constantly have to remind myself of this—it’s a constant struggle. I get very excited about it. When you are an entrepreneur and you have some runway, if you’re more of that kind of visionary entrepreneur, there are so many different ideas and so many different avenues that you can go down. How do you stay focused, right? You went specifically for this video production. How did you choose that, and how did you stay focused on that, as opposed to being opportunistic with all the different items that you could have done?
Sam Shelper 09:50
Well, the truth is, I was trying other things as well, and the video production company was just the one that started making money, right? Even with Testimonial Hero, I didn’t really intend to start another service-based business after I exited my first one, to be honest. That wasn’t my plan.
Callan Harrington 10:10
Why is that?
Sam Shelper 10:11
Just because, you know, a mix of—one, service-based businesses are great, but they can be very challenging. Now I actually know a lot more about them, and we really productized Testimonial Hero. That was something that made it a thousand times better, from a lifestyle and also scalability and growth perspective. You know, we’re one of the fastest-growing private companies in the U.S.
Callan Harrington 10:35
Congrats. I saw that, number 342 on the 2022 Inc. 5000, so that’s pretty up there in terms of growth.
Sam Shelper 10:43
Yeah, it’s excellent. We could call it out there; it’s excellent. Unlike the Forbes under 30, where you can just hire your PR firm, they actually take your financials and your tax returns to get on that list. So that’s cool, but just a little bit of a dig there at Forbes.
Callan Harrington 10:59
So I would love to go back to this, because this is something that’s talked about quite a bit, but I don’t know that I’ve seen—I mean, I’m sure there are others—but I don’t know that I’ve seen anybody who has done it this well. I bet the majority of people that look at you at first are like, "Oh, this is a SaaS company. This isn’t necessarily this productized services company." And not to say that there aren’t elements of both, right? But what I would love to dive into is this idea of productized services. For our listeners, productized services is where you have a service business and you form a product out of that service. A lot of times, some of the pains—if you think of a traditional agency business, like a marketing agency or a consulting company—are all the projects coming in very unique, and then you start to build some frameworks around it. But where you can really scale these things is when you productize it. So a couple of questions: what does productized services mean to you, and what was that transition like for you in doing that with Testimonial Hero?
Sam Shelper 12:01
Productized services means to me that you’re putting some guardrails around what you will do and what you won’t do, trying to make sure you can wrap a process around it so it can be delivered again and again, eventually without you needing to be involved at all. And basically, it’s exactly what it sounds like—you’re taking a more product lens to a service with the goal of making it easier to sell and easier to remove yourself from it so you can scale more. I think one of the biggest things, a nuance that is not talked about enough with productized services, is that it’s not binary. You’re either a productized service, or you’re not. The question is, how productized do you want to be at any given time to best achieve your goals? In the beginning, you might not want to be quite as productized because you just need to get some clients in the door. Sometimes you need to do a little bit of customization, or a lot of customization, to close those deals, get that initial cash flow. Also, you might not know what to productize, right? You might have to sell a bunch of engagements or projects to understand where the value can be captured and such. So in the beginning, a lot of times you’re broader, and then you kind of understand, "Aha, this is the thing. For us, testimonials are the thing. Let’s productize it." Then you can scale up to a point, but then, like us—we’re about a $4 million company right now, so not huge, but for a bootstrapped service-based business, and certainly for a productized service, I’d say we’re one of the bigger productized services out there that I’m aware of—not the biggest, but one of the bigger ones. But then you might get to a point where you’re like, "Okay, we actually have to reintroduce more customization because, in order to keep growing, if that’s your goal, you’re moving upmarket to this enterprise account, a SaaS company, introducing more customization and wanting more hands-on stuff." So it’s really a strategic choice of how productized you want to be at any stage of your journey. The key thing is, pretty early on, because we productized, I was able to remove myself from service delivery. And when I say pretty early on, I mean it still took like two years to do that. A lot of agency owners never fully remove themselves from service delivery or sales. But in about two years, I was fully removed from sales, and then I could just focus on growing the business or working on the business, right? At the end of the day, there’s that trite maxim as an entrepreneur: you need to work on the business, not just in the business. And productizing is one really good way to do that. A lot of agencies aren’t actually like a business. They’re more like self-employment, like a job that you have. It’s not really a business or an asset. So those are all the reasons why I like productizing. I’m not dogmatic about it, like, "Oh, you need to be a productized service." It’s more like, well, what are your goals, and what degree of productization might help you best achieve that?
Callan Harrington 15:01
It makes total sense. I think there’s a ton. I personally am a big believer in it. Here’s one thing I’d love to dive into: how did you guys productize? And if you have any stories specifically in that process, I think that’s huge because I think a lot of people want to do it but don’t necessarily know how to do it. So if you have any stories on how you guys did this specifically, that’d be great. But just diving a little bit on the how-to.
Sam Shelper 15:28
The biggest thing is that most people don’t have something valuable worth productizing. The productizing isn’t necessarily the hard part; it’s having something really valuable that you can actually do really well. I had spent four or five years before Testimonial Hero making video testimonials at Skyscope, my prior video agency. At this point, I was very good at making B2B video testimonials, so it really wasn’t that hard to do because I had built up that expertise. That is the step you can’t skip—it’s actually being world-class at whatever you’re trying to do and whatever you’re trying to productize. If you’re not there yet, you just need more time and effort to get better. That’s where I see people struggle when they’re starting out—they’re just not that good yet. And that’s not a judgment on them; it just does take reps to actually get good. You can’t decide you’re going to start a social media marketing agency from scratch with no experience because some guru told you it was a good move and then immediately try to figure out why you’re not doing six figures every month yet. There’s a whole differentiation and positioning thing, and market timing. One of the reasons we’ve had a lot of success with Testimonial Hero, relatively, is our timing was really good, and that was intentional. I sort of saw that video is still becoming increasingly important. Customer stories and social proof are more important than ever. No one’s really taken both of those two ideas and melded them together and built the best company in that space yet. I forget the original question, but those are a couple of thoughts.
Callan Harrington 17:00
No, it’s all good. I mean, you talked about—and we could dive more into that as well—but you talked in particular about, and I agree, you have to have a long-term focus. Even if you’re not an entrepreneur, if you’re in a career, having that long-term focus—you’re not going to shoot straight to CRO or CEO overnight. You’ve got to gain a lot of knowledge in order to do that. Now, some people can, right? You could be a great founder. You can go jump straight to CEO, but a lot of times you have to have that long-term focus. What I love about what you just mentioned is you took everything that you’ve learned in the past and put it together. So although Testimonial Hero, because you guys grew really fast, really quickly, may seem like an overnight success, it’s really a long time coming from what you’ve perfected, going back to the snowboarding videos since high school, which I think is really, really cool to see. You mentioned something about kind of creating guardrails. Do you believe that productizing is more about delivering on a repeatable process that others can be taught and kind of put into—I don’t want to say an assembly line, but you have this assembly line and we follow this? Is it better for products that don’t need really hyper-specific knowledge, like, for instance, a consulting company, which could be hyper-specific in a specific space and you have to have an idea of all the market forces? Is it better for companies or service businesses that have more of a repeatable delivery that they have?
Sam Shelper 18:28
Yeah, so it’s a good question. Typically, it’s basically a question about trade-offs and such. Yes, typically, if you’re productizing, you’re making a bit of a trade-off to have a smaller average contract value but making it more scalable and selling more of them, selling them more easily, and being able to staff them with relatively less experienced people because you have a good process now. I do think one of the other things that we did well is we kind of questioned that. I think before Testimonial Hero, there was a real prevailing sentiment that all productized services weren’t premium. It was just never like productized service didn’t equal a premium product. I specifically really wanted to push back on that and say, "We are going to productize as much as possible and also be a premium product." In that case, for at least our situation, we had to figure out other value innovations. Our first one with Testimonial Hero was that we built a global network of videographers all over the world to help us actually film the testimonials. So we were able to deliver these projects to customers, film anywhere in the world, at fixed prices. On one hand, we were productized, but we also had some really unique elements and still do have some very unique elements, so that can help command a premium price. The consultancy model, it’s just a different model. It’s still really good; it just relies on different resources. If you’re going to go a more traditional consultancy model, then you’re typically bringing on partners or people that you know can be subject matter experts. It’s more like the law firm model, where you’re billing a really high hourly rate, more like, "Eat what you kill." That person does really well. The firm at large takes a cut. I think they both can work, but for us in the video space, this is what makes sense.
Callan Harrington 20:10
Makes sense, it makes sense. And even the consulting model, it’s very much who you’re consulting with, right? And how you’re positioning yourselves as a consultant. Many consultants can productize a lot of it through digital courses and things like that, which is essentially the same thing, just targeting an audience that doesn’t have as complicated challenges as a whole, which is typically going to be earlier-stage companies. Not all, right? If you raise a ton of capital and you’re an early-stage company, you still have a lot of really intense challenges. I want to go back to something that we talked about. You productized the service, you started Testimonial Hero, you started to ramp that, and now you’ve started to remove yourself from the delivery of the service, which in services, a lot is talked about, right? You’ve got that kind of visionary lead, you have the delivery lead, and then if you’ve got a third part—I know Greg Alexander talks about this a lot in his book—you have somebody that’s creating new service offerings, but a lot of times I see that visionary taking that as well. How did you do that? How did you start to do that? And how did you start to kind of loosen up that feeling of, "I need to control this"? I don’t want to put words in your mouth, but I know that’s pretty common. A lot of people get your baby. How did you give that away?
Sam Shelper 21:25
I think you just got to follow the pain. At least in my situation, I got to a point where I had so much work coming in, and I was just burning the candle at both ends and everywhere in between. I didn’t have the choice to be picky about, "Oh, it’s not about if it’s my baby." It’s like, "I just can’t functionally, physically, keep doing what I’m doing. I need help unless I’m going to start turning down business," which I didn’t want to do. If you’re having trouble doing it, you might not be busy enough yet, but you’ll know if you’re just like, "I don’t care. I just need help." You get to that point, and I think that’s a good place to go to. My intention initially with Testimonial Hero was never to scale it up to where we are now, frankly. I had a software product idea I was working on that didn’t pan out, and I needed to generate some cash flow. I was excited about the idea, but it was more practical in the beginning, right? In the beginning, I was just building up a war chest, working my butt off, and got to the point where we had a nice war chest of capital and utilized freelancers per project, contractors as much as possible from the beginning. But eventually, someone still had to manage those freelancers, and that was me for the first year and a half. I got to the point where it was just clear that I needed help. I found a great person to help with the service delivery. It’s sort of like stair-stepping. People are like, "Oh, how am I going to remove myself?" You don’t immediately remove yourself from everything. You slowly remove one thing at a time over a month or two. You’re removed when you can slowly do that, but obviously, you have to make the right hire. I definitely made the right hire. There’s certainly an element of luck to finding great people. Although I will say, I was interviewing, I think, three people in the final round for that role. Even before I had any employees, I had set core values for what I wanted the culture to be like. I picked the final person because they best fit the core values that I had set. So, it’s lucky, but also, there was intentionality around the culture we were building. One of our core values that we have today still is attention to detail. It came down to two candidates. One of them had multiple punctuation mistakes in their email—missing commas. This happened like twice. This person was out. The other candidate, I think, had the edge anyway, but that just made it very clear. How you do anything is how you do everything. I believe that. I think there is something to be said for being proactive about the values you want to set before you bring in your first team member because three or four team members down the line, you have a culture, whether you like it or not. So you might as well put the thought in ahead of time. That was honestly one of the biggest things I learned from Testimonial Hero. Having some entrepreneurial experience is especially important in a service-based business. Your experience as the founder is really related to your experience working with your team. Do you like everyone on your team? Or are they stressing you out? We had a great team at Testimonial Hero. At Skyscope, it was a little more rough because we were kind of retroactively figuring out what our culture was as time went on. I don’t think we ever got it perfect. Very intentionally from the beginning at Testimonial Hero, I was like, "All right, here are going to be our core values," and that was before we had any employees.
Callan Harrington 24:40
I did that on day one of my business as well, and I’ve done that at every company I’ve been at. If they didn’t have them already, we typically built them pretty quickly. But I didn’t know that at first either. So, talking about that a little bit, how did you create your core values at Testimonial Hero?
Sam Shelper 24:56
A couple of ways, and I’m not saying that this is the best way. Some people might say, "Oh, maybe this isn’t the best way," but this is what I did. I thought about things that frustrated me, annoyed me with people in general, and how we could make the value the opposite of that, just to give it a positive spin. Then, I also thought about the strategic imperatives that we would need to succeed and the attributes about myself that I thought were good and wanted to continue to do a good job on and also replicate in other people. For example, we have six core values now. Our original five core values were—well, they still are. They haven’t changed; we’ve added a sixth one. Commit to attention to detail. Always be learning and growing. I wanted people who—you know, one of my biggest things is I’m a very curious person. I love learning and growth. I wanted to build a company and attract people who also shared that value, who are really engaged in the work they’re doing. It’s not just about punching in to get a paycheck. I wanted people who were actually interested in, you know, "Sure, I might not be at Testimonial Hero forever, but while I’m there, I want to learn and grow as a person to be the best person and professional I can be in my career and be excited about that." So, always be learning and growing. Celebrate work-life integration, freedom, and flexibility. We do a lot in terms of not having a lot of bureaucracy around how you want to work, where you want to work, unlimited vacation, and all that. Deliver an effortless experience. Just making it super easy for our customers has always been a strategic imperative—an effortless experience, right? And then the fifth original one was persistence and tenacity. You’re always going to run into challenges, and if people don’t have persistence and tenacity in a small, growing startup company, it’s going to be really hard and frustrating. So, I definitely wanted to screen people for that. Then, we added a sixth one within the last year, which is practice accountability and ownership. We had some situations where people weren’t taking as much ownership of their area as we would have liked. We were like, "You know what? We talk about this, let’s just make it a core value." Ownership, to me, doesn’t mean not making mistakes. It just means not making excuses. There’s nothing more frustrating than having people on your team who always have an excuse. It just doesn’t fly, as you know, in a high-performing organization. You’ve led teams like that. It’s like, look, it’s okay to make mistakes. Just take ownership of the solutions. If you haven’t heard back from that customer and we need to approve this project, and they haven’t gotten back to you on email, that’s not the end of the conversation. Can we contact them? Have you tried sending them a LinkedIn message? Have you tried calling them? Have you tried whatever it takes? Take a little bit more ownership of the situation instead of making excuses like, "Oh, I sent them an email. They didn’t respond." So, circling back to your initial question, how I did it was a mix of things that I knew would frustrate me that I wanted to avoid, things that I thought people would value that I also valued, like learning and growth, and then strategic product- or service-related things like an effortless experience and attention to detail that I knew would be critical to win.
Callan Harrington 28:14
I love that. One of the things you’ve mentioned a couple of times—I want to quickly ask—is how are you screening candidates for these core values?
Sam Shelper 28:22
A couple of ways. So, one, I always have a couple of questions. One of our core values is always be learning and growing. Can you tell me about a time, recently, both personally and professionally, where you had to learn something new to solve a challenge or achieve an outcome? What was it? Stuff like that. There’s no right or wrong answer, but you don’t want really thin answers, right? You don’t want answers that are just not substantial, and you can tell when people are actually passionate. You just don’t want thin answers. Another way we do it is we review all of our core values with them, and we ask, "Which of these stand out to you the most? Which of these resonate the most with you and why?" If they’re just like, "Oh, I like them all, they’re great," that’s not ideal, right? You want people to be like, "I love learning and growing. That means so much to me. That’s just the person I am. I love podcasts and all this stuff." Another example is you can follow up on this question. Sometimes, I ask people, "How do you stay learning and growing, personally and professionally?" You can always tell when people are actually passionate. They’re name-dropping their amazing podcasts, or it’s a really generic answer like, "Oh, I read The Power of Habit last year or two years ago. That was the last book I read," or whatever. And that’s a great book, but we’re really looking for specifics, just like any interview situation—specifics, actual passion, real substantial answers versus just thin answers that don’t show a lot of enthusiasm.
Callan Harrington 29:46
Makes sense—asking situationally based questions around those core values.
Sam Shelper 29:52
Exactly. I do a lot of situationally based questions personally because I think you nailed it. There is no right or wrong answer to a situationally based question, and I think a lot of times it’s hard when you’re asking a question and expecting them to come up with the right answer. They’re in a stressful situation, and you’re asking them to come up with that answer on the spot. They may not be the kind of person who can come up with that answer on the spot, so I think those are great.
Callan Harrington 30:14
So, Sam, the last question I want to ask is, you’ve had all this success. I love what you talked about. You’ve exited a company, started another, using all the knowledge that you gained at this previous experience, and have grown super quickly, ranking very high in the Inc. 5000. When you look back at all of this, if you had to give yourself advice at any time in your career, what advice would you give your younger self?
Sam Shelper 30:41
I would probably say, think longer term. Be more patient. For me personally, every business that I’ve started has never been the initial business I set out to start, in some cases. As an entrepreneur, you’re always hearing about what’s the hot space, or whatever’s hot. If you’re not in that space, there’s a lot of FOMO or second-guessing that can happen. I think I’ve gotten a lot better at that because, at the end of the day, first of all, you can’t compare yourself to another business model without taking the goods and the bads of that model. That’s important to realize. Also, on an individual level, you can’t compare yourself to—I believe, I don’t remember who I heard this from—maybe it’s from Tim Ferriss, who has brought this up a couple of times—you can’t compare yourself to someone else and just pick their good stuff. "I wish I was in that person’s position." You have to take their bad stuff as well. Especially earlier on in my career, I would always be thinking the grass is greener in different industries or different situations. My advice would just be to not worry about that, think longer term, and embrace where I’m at more, with the realization that for me personally, I’m 33, and if I want to do—like, right now, AI is the hot startup idea, circa two weeks ago—it’s like, great, I can keep running Testimonial Hero for the rest of my 30s. If I want to do some other AI startup, I can do that in seven years or whatever. Instead of being like, "Oh, I wish I was doing that right now. It seems so cool." The advice I would give is just embracing where you’re at right now, taking a longer-term view, and realizing you probably have more time than you think to do all these other business ideas that you want to do. All entrepreneurs have multiple business ideas. Thankfully, I haven’t actually tried to do most of them. I haven’t tried to do multiple ones at the same time; that’s when it becomes really problematic. On my end, it’s more of an intellectual distraction sometimes, but that’s basically the advice I would give: be patient, stay focused, and don’t let the grass-is-greener situations distract you. Do the best job you can with what’s in front of you because ultimately, if you want to do something else way down the line, the experience you get wherever you’re at is what lays the foundation for that, whether it’s the leadership experience, the strategy experience, or the people management experience. The best thing you can do is always be building the skills that you need to eventually take that huge swing or whatever it is you want. There’s no reason you can’t do that today, so don’t lose sight of that.
Callan Harrington 33:28
I love it. That’s a great spot to end it. Sam, thank you for coming on the show.
Sam Shelper 33:33
Yeah, my pleasure, Callan. This was fun.
Callan Harrington 33:35
Thanks.
