I – We – They Framework: How I Scale My Personal HoldCo

Yong-Soo Chung [00:00:00]

Today's episode is a remake of an older episode - episode 14 titled the 'I/We/They' framework. This is one of my most popular episodes to date and to be honest, one of the most important concepts that all founders should know. Plus, it was an earlier episode and I was quite new to podcasting and my process involved writing down my thoughts, switching on the mic, and recording the whole thing at one go.

But now I have an incredibly talented producer working with me on the show. So, I wanted to revisit this episode and make it, shall we say, less cluttered?

So, I did exactly that. I have remade it in such a way that anybody wanting to grow their business can listen and find EXACTLY what they need for THEIR specific use-case.

Without further ado, here's the episode!

Yong-Soo Chung [00:00:48]

The 'I/We/They' framework has changed how I approach my own business. In fact, the moment I began to think about my business using this framework, my business growth accelerated!

I wish that someone had taught me this framework 8 years ago when I was preparing to begin my entrepreneurial journey with the launch of UrbanEDC.

Because, if I had known about this framework back then, I would have probably been sitting here today with an ADDITIONAL zero in my annual revenue figures. Maybe.

Well, I've decided to make my loss YOUR gain.

Which is why I'm gonna spend the next twenty minutes or so telling you *everything* I know about this framework. I assure you, mastering this framework will help you cut down years of guessing and accelerate the growth of your business.

And I have packed all this knowledge in one short 20 minute episode.

So, jet-setters, buckle your seatbelts and get ready for take-off!

Yong-Soo Chung [00:01:47]

Hi, I'm Yong-Soo Chung… Let's get down to business

Yong-Soo Chung [00:01:59]

The next generation of successful founders in this digital age of entrepreneurship will leverage their audience to launch, build, and scale their brands. First Class Founders explores this golden intersection of audience-building & company-building with proven strategies to grow both your audience, which is your distribution, and your brand, which is your product.

Because those who can master both will create a category of one.

Hi, my name is Yong-Soo Chung and I'm a serial entrepreneur who bootstrapped 3 successful businesses from $0 to $20 million over 8 years.

On this podcast, you'll learn timeless lessons from world-class content creators, startup founders, and CEOs. You'll also hear tactical tips & strategies from ME, Yong-Soo Chung!

Are you ready? Then, let’s begin!

Yong-Soo Chung [00:02:52]

Before we begin, we teamed up with HyperPods to bring to you a quick 3-min hyper-visual summary of this remake episode on my very own ‘I/We/They’ framework to help you consume faster, understand better, and retain more key ideas and insights.

You can grab the hyper-visual summary for this week’s episode absolutely free at firstclassfounders.com/hypervisuals.

Yong-Soo Chung [00:03:18]

As entrepreneurs, we're all juggling a hundred different things all at once. I felt the same way when I first started out. But, over the past eight years of building my business, I discovered something crucial.

All businesses go through three stages - Experimenting, Building, and Scaling. And, at each stage, there are specific demands that you need to fulfill.

And that is what the 'I/We/They' framework focuses on - meeting and fulfilling those specific demands at the RIGHT time. In simple words, this framework gives you clear guidelines on what actions you need to take at various stages of your business to make it grow and scale efficiently over a period of time!

So, let's dive in!

The first part of this framework is the Experimental phase, or what I like to call the "I" part of the 'I/We/They' framework.

Think back to the early days of your life. When you are born, you barely understand the stuff that is happening around you. Like a fish out of water, you thrash constantly, trying to find your bearings...

You are completely reliant on someone else to ensure that you survive your first few years.

As time passes, you gain control of various parts of your body - the five senses, the limbs, the brain... Then you learn to work several of these at the same time. Once you are proficient at controlling multiple parts of your body, you begin interacting with the world immediately around you.

In other words, you constantly experiment and figure out how to work the various parts of your body to navigate the world around you.

Now, replace the word "body" with business in that previous sentence.

'You constantly experiment and figure out how to work the various parts of your BUSINESS to navigate the world around you.'

Yeah, that's why I called it the "I" phase of the framework.

Yong-Soo Chung [00:05:09]

Because, at this stage, you are navigating your business by yourself, experimenting with stuff, building your audience, validating ideas... Basically, this entire stage is about YOU and your attempts to exercise and gain control over your business-muscle.

And, the allegory I gave about early years of life applies in other ways too.

You fall a lot during the early days of your life while trying to gain control over your limbs. Similarly, you FAIL a lot in the early days of your business trying to understand the various parts of the business.

The product that you thought was solid gold will turn out to have no buyers. Instead, the service you thought no one would want will suddenly develop insane demand. The audience you were hoping to cater to will be replaced by a similar but slightly different audience.

You will have more questions than answers during this phase and... that's okay. Because you're still exploring what works and what doesn't.

Because this phase is all about experimenting, exploring...

And so, you will spend a lot of time researching, looking for inspiration, buying online courses, or watching others who are already further ahead than you.

But, here's a word of warning: Don't.

That is, don't spend too much time reading and researching. Sure, it feels like gathering as much information as you can is important. Because a good business needs to be built on a solid foundation of information and data.

But, at some point, the law of diminishing returns starts to apply.

Worse, all that information can sometimes have the OPPOSITE effect. That is, you might feel OVERWHELMED by all the information and you may even lose motivation altogether!

That said, if you find yourself at this stage, don't stress. I know exactly what you need to do to get out of this rut.

Yong-Soo Chung [00:06:54]

First, get out of your comfort zone.

Get out there and talk to your target audience about their pain points. Nothing beats talking to real potential customers. The insights you get from these conversations can either make or break your business. So, learn their language. Repeat the exact same words they use to describe their pain.

Then, formulate potential solutions to their problems. Test and validate these solutions. Figure out if they are willing to pay for this solution. How much they are willing to pay for this solution. Build a list of these people. Because these will become your first batch of customers who you will reach out to, when your product is ready.

The only two pieces of advice I would offer at this stage is: Get as much feedback as you can.
and focus only on the signals, ignore the noise.

Use these signals to fine-tune your offering, target audience, pricing, and perhaps even your business model. This is what will ultimately help you figure out your product-market fit.

Most importantly, you, as the business owner and creator, MUST stay involved during this phase.

Because your business venture is a newborn at this stage and it needs all the care and attention you can give it. And just like any newborn, your business too will require you to stay constantly on your toes. It will keep you awake and give you sleepless nights. It will drain all your energy and demand even more.

So, try to stay lean and flexible. Make sure you have your support systems in place to help you with potential burnout.

Oh, speaking of support systems, here's a pro tip: Your friends and family are great to lean on for support during this phase. But they're probably not your ideal customer avatar. That means, any feedback you receive from your friends and family? Yeah, you can smile politely and say thanks, but no thanks.

And I speak from experience. Because, when I launched UrbanEDC, my friends and family were puzzled. They wondered what on earth possessed me to quit my incredibly well-paying job in crypto! They just couldn't understand who would want to buy fancy bottle openers and expensive pocket knives!

But it didn't bother me at all.

Because I knew that my friends and family weren't my target audience. Instead, I focused on the conversations I was having with the EDC community on Instagram and other places where they were already hanging out. I was focused on building relationships with the people who *were* willing to pay for fancy bottle openers and expensive pocket knives.

And because I did ALL that, I was able to launch UrbanEDC, stick with it over eight years to the point where it now makes me a cool 3 million dollars in annual revenue, every year.

Do you now understand why I said "focus on the signals, ignore the noise"?

In any case, following these steps means that you have successfully navigated the "I" phase of your business.

And that levels you up to the next phase, which is the "Building" or the "We" phase of the 'I/We/They' framework.

But, before going into the details of the "We" phase, I want to quickly take a moment to thank my sponsor CastMagic.

Yong-Soo Chung [00:09:32]

Jetsetters, as you may know, I hand-pick all my sponsors from companies I truly believe in.

That's why when Ramon from Castmagic wanted to sponsor First Class Founders, it was a no-brainer.

This isn't just any tool. This is the tool that gives me back 20+ precious hours every single week.

Say goodbye to painstaking edits and tedious content crafting. Castmagic has revolutionized my content creation workflow.

With Castmagic, you'll harness the power to amplify the value of any audio file tenfold. It's not just about tools—it's about shaping the future of content creation.

I can’t recommend it enough. Dive into the Castmagic experience now!

EXCLUSIVE BONUS: To make this a no-brainer, use code FOUNDERS30 to grab 30% off the first 3 months of your subscription.

Okay, let's get back to our episode on the 'I/We/They' framework.

Before the break, we finished discussing the "I" phase - that is, the Experimental phase - of this framework.

Next up, is the "We" phase.

Yong-Soo Chung [00:11:22]

The "We" phase, as the name suggests, is when you need to multiply yourself.

At this stage, you probably have developed a product or a service. You have found customers who are willing to pay for this product or service. Maybe you even HAVE a few customers trickling in already.

I cannot begin to describe the rush of having a paying customer. Not only does it feel incredibly validating, it is also highly addictive.

So addictive that you sometimes - no, almost always - end up taking a bit too much on your plate. One customer becomes two, two become four, and before you know you have more customers than you can handle.

The more customers you take on, the more the bugs in your product or service pipeline become apparent. And when this happens, you suddenly have the double problem of satisfying your customers AND fixing the bugs they have unearthed.

Suddenly, you are getting pulled in a thousand different directions. Customer A wants you to do this. Customer B prefers it the other way around. You step in to find a middle ground and Customer C chimes in with a unique request of their own...

Your work expands to fill up your day and continues to expand until it takes up all your free time. Then it expands some more and takes over your entire life leaving you with barely enough time to eat, sleep, and shower.

You find yourself wishing there were 48 hours in a day. Or there were two of you so each one could work 24 hours.

This is a crucial point in your business.

Yong-Soo Chung [00:12:47]

You are probably overwhelmed at this point but, listen to me, you are on the right track. This is, very much, a solvable problem.

The moment you formulate this thought... That you need to clone yourself, or that you need 48 hours in a day... The moment you formulate this thought for the first time, stop everything you are doing and recall these words.

It is time to set the "We" phase of your business in motion.

Simply put, the "We" phase is when you build systems and processes to keep yourself from running around and driving yourself crazy. And this is achieved by creating three primary systems.

1. A lead-generation system, which is your distribution…
2. Value delivery system, which is your product…
And finally,
3. Operational system for monitoring both systems 1 and 2.

Let me explain with an example.

Suppose you own an e-commerce store selling pocket knives and flashlights.

Yeah, you have verified that the customers exist. But you still need to bring them to your store, right? That's what the lead-generation process is supposed to do.

In simple words, this is your strategy to get new customers in the door. Go where your potential customers are already hanging out. Build and establish your authority within that community. This is where you will differentiate yourself from other similar offerings. And, by doing all of this, you will convert your audience into real, paying customers.

In marketing terms, you are building a funnel that will move cold leads to warm leads to real customers.

Once you have built your lead-generation systems and optimized them properly, you will need to focus inward. That is, you will need to build out the value delivery for your product or your service.

That is, you will need to build out systems to make sure your paying customers get what they pay for. If your customer orders a pocket-knife, they get the pocket knife they ordered. If they order a flashlight, they get a flashlight, and not a fidget-spinner.

And, more importantly, that the flashlight or pocket-knife that they ordered is up to their expectations.

Your aim as an entrepreneur should be to deliver VALUE and not just goods and services. And guess what forms an integral component of delivering value?

Yup, customer satisfaction.

Yong-Soo Chung [00:14:57]

So, along with your delivery pipelines, you also need to set up feedback mechanisms for your product or service. Continuously assess your value delivery mechanisms by asking your customers if they are happy with your product or service.

If they are happy, ask them for referrals. If they aren't, ask them for suggestions to improve and try to implement them.

Generate leads and then deliver value - those are the two systems you need to quickly put in place at this stage of your business.

Now, you may have noticed that I keep referring to these as processes and systems but in each of these examples, I have explicitly mentioned YOU as the agent performing the corresponding actions.

Which may have led you to wonder, does it really HAVE to be a system? Can't I just do all this ad-hoc?

Go into the community, post about the latest gear drops and bring customers over as and when needed. Why bother with building out a system and a process? Ship the products they buy, by hand, and then ask them what they thought of it?

Why should you bother with building any of it as a system?

The answer is because the difference between the ad-hoc approach and the systemized approach is the same as the one between selling bread baked at home vs shipping thousands of loaves to supermarket chains on a daily basis.

Which is why the third system you need to put in place is so important - the operational system, which will help you monitor everything.

This system is a process for managing the lead-generation and the value-delivery processes.

Yong-Soo Chung [00:16:19]

Let's go back to our earlier example.

Suppose, you have built out a robust lead-generation for your e-commerce store, in which you regularly post content and interact with members of a specific community, who have grown to trust you and look to you as an authority. At the same time, you have also built out your value-delivery systems and keep a close eye on the feedback and the reviews being generated.

The whole operation is chugging along smoothly.

Now, suppose you find another community which might be a good source for new customers. You already have your hands full with the existing community. So, you hire an intern to help you replicate everything you did with the first community.

Because you can't sit with the intern each time, you document everything into an SOP - a Standard Operating Procedure - and hand it over to the intern to follow word-for-word.

Now, word gets out and a few curious customers from this other community start visiting your store. Within a matter of days, your orders double. So, you figure out a new process for streamlining your value-delivery to ensure all your customers are satisfied.

You document this into another SOP and hire another intern, or maybe even an employee, to be in charge of following this SOP. Maybe even make adjustments as necessary.

Here's the thing.

Growing your business at this point is simply a matter of replicating this setup multiple times. You have the SOPs. All you need to do is find competent people who can follow these SOPs and make course-corrections when needed.

As the owner of your business, work with your team to refine and optimize this operational process for as long as is necessary. Because you will need an all-star caliber team around you to help you with these 3 processes. So, mentor them and teach them everything you know about your business.

Having a team and an SOP in place also frees you up to think about new growth opportunities. Perhaps you can come up with seasonal gear-drops to drive more foot traffic to your store.

But, did you notice something?

You thought you were building out the third system here. That is, the monitoring process to help you manage lead-generation and value-delivery processes. What you have ALSO done is begun working towards the "They" phase of the framework.

In the first phase, you were a newborn, an infant, a toddler, flailing and grasping at everything, and trying to gain a basic understanding of your business. In the second phase, you are a child, making friends and allies and building relationships with the people around you.

Which means, now it is time for you to grow - both literally AND figuratively.

That is, it's time for "Scaling" or the "They" phase of the 'I/We/They' framework.

And, as you might have already guessed, the "Scaling" phase will bring with it an entirely different set of challenges. Heck, you might even find yourself owning an entirely new business at the end of this phase.

Because that's exactly what happened to me, when I was trying to grow my ecommerce venture UrbanEDC. I found myself growing increasingly frustrated with the available 3PL solutions. So, I created my own GrowthJet.

Yong-Soo Chung [00:19:29]

E-commerce fulfillment is a pain. One time, one of my customers emailed me asking me why we had shipped them an empty box. It turns out the 3PL had stolen the $1,000 product and shipped an empty box to my customer. Yeah, that was not fun.

So, I launched GrowthJet, a Climate-Neutral Certified third-party logistics company for e-commerce brands.

We pick, pack, and ship your orders from our 39,000 square foot warehouse without any hassles. You even have a dedicated on-site account manager.

GrowthJet is the 3PL that I wish I had when I launched my own brand, Urban EDC.

If you have an e-commerce shop, check out GrowthJet and hit me up!

Okay, let's get back to our episode on the 'I/We/They' framework.

Yong-Soo Chung [00:20:32]

In our episode today, we first explored the "experimental" phase of this framework - which I dubbed the "I" phase. Then we looked at the "building" phase - which I dubbed the "We" phase. And, at the end of this "We" phase, you have a product or a service, a team, and several SOPs to ensure that the day-to-day operations of your business happen smoothly.

Honestly, if you were careful and diligent with the first two phases, the third step will feel like a breeze despite the fact that it is actually the hardest one of the three.

Because it involves letting go...

...and I'll explain exactly what that means in a moment but I want you to pay attention to the name of this phase first.

"They."

As the name suggests, the "They" phase does NOT involve you. It involves everyone BUT you - that is, the people you have hired along the way.

Implementing the "They" phase of this framework requires the people you formed a "We" with in the second phase to step up and take the reins.

It requires you to empower your team.

How did *I* figure out which areas need empowering and which areas to retain control over?

Once again, I'm going to use the ecommerce store as an example to explain.

Suppose that I hire an operator to be in charge of all the SOPs. And, suppose this operator comes with a ton of experience in this industry. That means, they will cost me more than the average market rate. But it also means that my SOPs will be followed diligently. Suppose I find that this operator is perfect for this business.

Here's a question for you: do you think that the pay alone is enough to keep this operator interested in the job?

No, right? Then what do you think is the single most important factor for motivating your employees?

Yong-Soo Chung [00:22:15]

Let me give you a hint before I reveal the answer.

Suppose I decide to give my operator the authority to make adjustments to the SOPs when needed. But, I also tell them that any changes to the SOP need to go through me before they can be implemented..

What do you think their response will be?

Yeah.

The single most important factor for motivating employees is not money, not equity, not stock options. In fact, there is NO amount of financial upside that will convince an employee to stay if they have made up their mind to leave.

Yes, people do negotiate for higher pay and greater equity. That's just human nature to want more. But that isn't the reason they stay with you.

The reason they stay with you is YOU.

Or, more accurately, the LACK of you.

As in, the trust you show in them.

Remember I said this was about LETTING. GO.

Yup, the single most important factor for motivating employees is the autonomy to make big decisions for the company.

And it's not just me who says it either. Matt Mochary, one of the world’s most sought-after CEO coaches, says the same - it's having an impact on building things that get used in the world that motivates your employees.

The feeling of ownership, the very same drug that YOU are addicted to, is the drug that your employees also crave. And everything they ask of you is basically a step in that direction.

Ownership over creation.

Ownership over decision-making.

Ownership over action.

My own businesses sky-rocketed when I released my control over the day-to-day affairs and delegated the decision-making process to my team. And yes, they made mistakes - tons of them. Costly ones, too. But, so did you, remember? That's how you learned. That's how you grew.

And that's how THEY will grow too.

Don't think of it as THEM costing you money. Think of it as you INVESTING in their learning process, their growth.

In fact, if they aren't making mistakes, then I can assure you they AREN'T learning. And if they AREN'T learning, then they definitely aren't GROWING. And that should be a sign for you to challenge them, maybe empower them with the authority to make even bigger decisions on behalf of the company.

Yes, there is a very real risk that one of these mistakes could BREAK the entire company.

Yong-Soo Chung [00:24:29]

But, guess what, there is a way you can account and mitigate for that to a large extent. I use THREE strategies frequently with MY teams - Brainstorming, Buy-ins, and Belief:

Let me explain each one of these in a bit more detail.

1. Brainstorming.

I heavily encourage my team to brainstorm solutions first. I participate in these sessions, mostly as a silent observer or listener. And, once they finalize a course of action, I chime in with my feedback on the decisions that your team makes.

This works incredibly well with teams that have gotten off-track and disjointed. It helps bring the members of the team closer - both mentally and culturally.

2. Buy-ins.

Sometimes, no amount of brainstorming can bring the team to a consensus. Or their brainstorming seems to miss something obvious. And, as it so happens, you already have a solution but it is time-critical.

In such situations, my go-to strategy is to get my team on the same page as me. I propose my solution but with the clear understanding that it needs to be a unanimous decision. This is necessary so that they feel ownership over that decision.

3. Belief.

Elevate the key operators in your business to take the reins from you. As your company grows, it’s important to develop a culture of accountability and ownership. Each employee should believe that they own a certain part of your business and they are 100% responsible for that part of the business.

At the same time, it doesn't hurt to verify first. Just ensure that you aren't causing any decision-making bottlenecks at the company when you do this!

To incentivize your employees further you can implement a pure meritocracy - where all your promotions and appraisals are purely performance based. You could also implement profit sharing for your employees. For example, for Urban EDC, we have a 10% profit share bonus for all employees based on their salary and how long they’ve been with us.

Basically, the "They" phase of the framework requires you to ACTIVELY extricate yourself from the business and trust your team to take over the reins from you.

And, here's the absolutely unbelievably surprising bit - if you set up this phase properly, you will see the business grow even faster than when you were managing the business yourself. And I can offer my two wonderful businesses - UrbanEDC and GrowthJet - as proof of the same.

Because I empowered my teams to make important decisions by themselves, they are now thriving and running the day-to-day operations smoothly, without me.

It's like watching a child that has grown into a responsible adult!

And that, ladies and gentlemen, is my 'I/We/They' framework!

Yong-Soo Chung [00:27:09]

But wait, don't skip away just yet.

Before I wrap up this episode, I have an action item for you that you can implement IMMEDIATELY to grow your business.

Here it is:

"Identify which phase your business is in right now.”

That's it. That's the action item.

Because each phase comes with its own set of tasks, as you know by now.

Is it in the Experimenting phase, where you are talking to potential customers, validating ideas for a new product or service offering?

Is it in the Building phase, where you are building out a team and a set of systems alongside them?

Or, is it in the Scaling phase, where you are empowering your team to take ownership of the business and run it entirely by themselves?

Once you identify the phase, you can rewind and go back to the corresponding part of the episode and listen to the specific steps you need to take in that phase. Then, act on those steps and speed through to the next phase - simple, isn't it?

Yong-Soo Chung [00:28:01]

And if you are already in the final phase of your business, maybe it is time for you to spin up a new business?

I highly recommend listening to:

- episode 25 titled, "How To Turn Your Side Hustle Into a Million Dollar Business as a Creator" in which I have laid out a seven-step plan for you to build and monetize a side-hustle that earns you a million dollars!

Let me know what you thought of this episode. Share your thoughts with me on X @YongSooChung - I'm always up for some good constructive feedback! In fact, follow me and send me a DM for a fun little surprise!

I'll see you next time on First Class Founders!