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Next Round is the show where pre-seed and seed investors share what they’re seeing in startups — and the founders they’re backing. Each episode gives founders real investor insight and gives investors a stage to spotlight the companies they believe in. Hosted by Chris Hines, the podcast is building the content-rich discovery layer between startups and capital.
Hello, founders. Welcome back to the show. I'm your host, Chris. Today, have very special guest, Stuart Webb. We're gonna talk about systems for founders today.
Chris:I'm excited for this one. I think with this new AI movement, systems are now more important than ever because people are adding tools and adding things to their workflow, but not really having a game plan and stuff. So Stuart, welcome to the show.
Stuart:Great, Chris. Thank you very much for inviting me on. I'm looking forward to this one as well, because you're right. There's an awful lot of fluff and hype and let's cut through it.
Chris:Right, so what's the first thing you would tell somebody who wants to add specifically a founder who's trying to add more systems into their company? Is it, hey, you need to add this specific AI tool or you need to plan this way? Like, what's the first step?
Stuart:I I think the the first thing that I really want founders to know is what's the problem they solve? Because you can add as many tools as you like, but if you're not absolutely crystal clear about the problem you solve, then you end up just moving stuff faster through your business that doesn't help anybody. Clarity of vision, clarity of your north star to enable you to put the right tool, the right system in place, and to find that big growth lever that you pull hard in order to grow your business is the first problem that most founders fail to solve because they're too busy looking at different AI tools or different systems or a new thing they can add and they miss how do I help my customers solve their problem. So I want them to get real clarity about that and then you can pack around that the right tools, the right systems, actually pull that growth lever and pull it hard.
Chris:I like that. I like that breakdown because when AI popped up, I would say everybody started to focus on it two or three years ago is when it really, really started being pushed a lot more. I think ChatGPT was the thing that made it more popular to all business owners. I noticed entrepreneurs starting to add just a lot of different tools resources and it can just be really convoluted, like especially now because so many tools do the same thing. You end up spending more money than you need to because you just add in tools just to add them.
Stuart:Yeah, and for me, AI is a brilliant tool if you know what you're doing. The thing about things like AI is a lot of the time you have to learn how to write the prompt because the first AI experiment you run fails badly because it doesn't produce the result you want. It's brilliant if you get it right, but you have to learn the right prompt. You have to know what it is you're trying to achieve by learning the prompt. So I spend a lot of time refining.
Stuart:It's that old thing, think it was Abraham Lincoln who was quoted as saying, if you give me twenty four hours to chop down a tree, spend twenty three hours sharpening the saw. Refining the prompt and things like that are all based upon who is it you serve, what is it you're trying to do, what's the problem that they have, and therefore what's the solution I have to that problem. Once you've got that clear, writing your prompt becomes easy, and then you can put your systems around it.
Chris:Yeah. And I was looking at your website, kind of reviewing that before the show about your five pillars of growth. I think we covered the first one in terms
Stuart:of vision.
Chris:So the second one is guaranteed lead flow. This is probably the biggest thing that investors talk about when I talk to them about start ups, is they wanna know that you can get customers, you can get users, whatever it is that you have a way to reach your prospects and to get deals done. What's the system that you usually help clients with in terms of guaranteed lead flow? Because guaranteed is a strong word.
Stuart:Yeah. Yeah. Well, it's two things here, Chris. And I think you picked up on a really strong point. The first is that too many founders I see get busy and then turn their lead flow off because they got busy and they don't want any more business, because they got enough to do and they've got into a situation where they will it's gonna be fine.
Stuart:It's not gonna be fine Chris, it's gonna be a problem in a few months time. So the first thing that the mindset of a founder has to be is I've got to keep my lead flow on, I've got to keep pulling people into my funnel just in and you know, you can always turn around and go, I can find other people to help me deliver to my customers, or indeed I might find that some of those customers, I've attracted them but they're not quite right for me, I can find people around me, at joint ventures, I can find people who can help, so I can funnel those people off to other people who can help. You don't need every single one of those customers, and if you do have to help every one of those customers, you can then start scaling. So the first problem that I find with most founders is they're far too quick to turn off their lead flow because they've decided that actually they've got enough business at the moment and then it becomes a problem for you. Businesses run out of cash flow very quickly when they do that.
Stuart:So that's problem one that we try and guarantee leaflet. The second one that I find, and I was writing a blog post about this just a few minutes ago, too few of my clients I'm working at the moment when I start with them, are talking about the benefit of the problem that they solve, know. I have a real thing about this, I sort of keep going on about it. I was just talking to one today, his basic thing was my software saves time and I went no it doesn't save time, no no it saves time. I went look, my wife is allowed to tell me that my clothes don't fit, but I can't say that to her.
Stuart:So if a customer says to me it saves time, I can't say to them my software will save time, because my customer don't, they want a problem to be taken away. They want something else done to solve their problem. So often we are looking at the wrong value proposition, so we spend a lot of time refining what the value proposition is and it backed down to that what is the problem we solve, what is the thing that the customer says I really value about this. Once you've got that you can start to build your lead flow around it, then you can start to put out messages which basically hone in on that problem and you know that customers that you're trying to attract have got that problem, and you say this is your problem, I have this beneficial solution for you. So the whole of what we call about the guaranteed lead flow is about making sure that we're running the experiments in order to make that proposition clear, make that proposition the big sort of you know target that we can then start aiming our messages at.
Stuart:We have about, we have 10 marketing elements as we call them that we put around actually guarantees those 10 marketing elements zero in on that value proposition really enlarge the benefit behind it.
Chris:Okay. That's a really interesting approach because one of my questions was gonna be an example of how you test that messaging with positioning. Because now you can sit in chat GBT or Claude in these AI tools and try to develop your positioning, your message, and it can feel really good to you as a founder, but then how do you get it out there to test? Do you just put it in tweets? Do you record a five minute video?
Chris:What's your best model for testing?
Stuart:So I'm gonna say two things about testing. And if you look at my website, perhaps it'll become clear. My background was as a scientist a few years back, well not a few years, many years back, so I still bring some of that scientific rigor back in. So I'm looking for two things when I'm testing. I'm only going to change one thing at a time when I run a test, because I want to know exactly which thing is making the big difference.
Stuart:So I'm running experiments in exactly the same way as I did when I was running my experiments back in the lab. I am changing one variable, and I'm looking to see what happens. The second thing I'm doing when I'm testing is I am going to try every different type of experiment before I give up. So I will do video, I will do headlines, I will do colors, I will do different ads, I will run every single channel. And I will then look at the data, and I will determine the big growth lever behind that.
Stuart:And at that point, then I actually sort of activate it and say, okay, we're going to standardize on this for a bit. But that doesn't mean we're gonna leave it. We're gonna come back to it occasionally. We're gonna rechallenge it and make sure that it's working. So it's about running those experiments and looking at the data.
Stuart:I come across we bring people into the systemized program, and we find so many founders. You ask them, okay, show me the data. What is it that caused you to go with that? And they would say, it was a gut feel. That's not good enough.
Stuart:You have to be running and capturing the data, and you examine the data. And I'll examine the data like a scientist. I will I will work on the data in spreadsheets, I'll work on it with statistical models, and we will tell exactly which things are pulling your growth levers down to the 0.001%. But we can know that that 0.001% will have a measurable difference in the benefits of the company.
Chris:Okay. Okay. So we covered step two with guaranteed leave flow. Now number three is deliver with excellence. This one is really interesting because I think the delivery part is something we forget about.
Chris:If you are focusing a lot on leads, it's so easy to forget about actually delivering on the value you get. After you close the deal, you get the sale, you celebrate and that's it. You just kinda forget about it.
Stuart:So once again, I'm just gonna give you my two highlights of this one. Two real killers on this one. Too many founders chase after the next new lead. You can mine your customer base for years if you have made sure that you kept them happy. So many founders run after the new lead because they think the new lead will be more profitable.
Stuart:Your current customer base is going to deliver more value to you, but only if what you've done is left them in a happy situation, and so often, we have not left them in a happy situation. Spend a lot of time, we've talked a little bit about the guaranteed lead flow, it's about that vision, it's about ensuring that you've understood what it is you deliver. If you then fail to actually live up to what promised in your marketing, customers will leave unhappy. You have to remember your marketing goes from the moment the customer touches to the time that you actually go back to them and say, were you happy? You have to make sure that's all aligned.
Stuart:I am always aware of a cheap airline that promises me they're gonna make me feel like a king, and when I get on the plane, I feel like I'm in the cabin at the back of the plane with the rest of the cargo. That is not a good feeling, is it? You don't wanna fly with those people. So you have got to remember, if I go to an airline website and they basically tell me we're gonna treat you like the cargo at the back of the plane, and we're only gonna charge you $20 to do it, hey, I'm happy because that, as far as I'm concerned, is what they've promised me, and I've got to accept it. So I'm constantly looking back again at the alignment between your marketing and your delivery and making sure that people are actually sort of saying what they're going to deliver.
Stuart:The systemized program that we're talking about here is a six month program, the first thirteen weeks it's all about embedding this stuff, the second thirteen weeks is when we look at all of this data and we then find the big growth lever and pull it, and very often you find that the big growth lever is the fact that we've ignored massive numbers of because we've chased after new ones and tried to offer them something bright and shiny and new. And actually they'd like to come back and buy more, but we've just forgot to go speak to them.
Chris:I think that's such a key thing to running a start up now because it's so many distractions now for founders, whether it's chasing funding or trying to, like you said, focus on leads. It throws off your growth I think you can reduce churn by focusing on who you have. And I kind of think if you use content to leverage that and your your great results with current customers, that's a way to kind of attract more customers is by showing off, hey, look at these happy customers here, all of these testimonials. You put that on display, it can really change how people perceive your brand.
Stuart:You know, if you look at some of the great brands that are built, they've been built on the fact that customers greatest adverts, know, they're talking about you, if you can make your customers be the people that are going out and talking about you and you being your advertising, it is cheap, it is easy to pull on, and they will keep coming back to you. We spend far too little time trying to make sure that we have got customers that spend their time with us, love us and talk about us.
Chris:So let's talk about team. First question here is, when should a founder, a solo founder make their first hire?
Stuart:Do you do you know something? Let me just go back. The problem that I had when I first founded my first business, I was a scientist, I came out of the science world, I'd spent my life doing my own thing. My first couple of businesses were a nightmare because I would hire people, and then I'd not give them any work to do because I still thought I was at the centre of the business. And I was the only one that knew what was happening.
Stuart:And I spent all my time doing their jobs for them. And I lost good people because of it. I then discovered that actually, I could delegate my job to them if I had trained them in the right way of thinking and the right way of behaving, and then let them get on with it because basically that's going to scale my business faster. I would advocate the first time that and I know I remember I was very nervous about the first time when I learned this, I was going to let go of this, and I hired somebody to do this and I thought but what if they run away with it? What if they get it wrong?
Stuart:What am I going to do? So too often we wait until we think we're able to control that situation before we make that first hire. I'd advocate too many of us during the startup and the scale up phases of our business spend our time looking at the path of least assistance. We're trying not to let go. Hire the first person that you can the minute you find that they're the right fit.
Stuart:I think of hiring as being more like the high jump than the 100 meter race. If you've been watching the television over the last couple of days, we've had the world athletics tournament going on. Don't think of the hiring like that 100 meter race, which is where you have a fast sprint and the first one to cross the line is the winner. You've got a pack of eight and the first one to cross, you give them the job. I think of it as the high jump.
Stuart:You've got a bunch of people who have got a bar to clear. I set a standard of people that I wanna hire, and I ask each one of them to clear the bar. If none of them clear the bar, I just go and find another eight people to start going through the round again, then we wait till they clear the bar. I do not lower my bar and say I'll just take somebody that's able to get up, get over the bar because I need somebody, I'm going to set the bar. So I start by thinking to myself, these are the behaviors I want, I want customer focus, I want somebody who's going to be able to understand how this product solves a problem.
Stuart:And then I set this bar and I go, right, I'm going to find somebody that clears that bar. And I'm to find them early. And I'm going to get them into the team. And I got to work with them so that they can take on a part of my job while I go and focus on something else. For me, founders should be looking at going, how do I find the person that clears the bar that has the right behavior, has the right thinking, for me to trust them to do this, I then take them on because they've cleared the bar, and then I give them the job, and I work with them to get better.
Stuart:What I don't do is then say, I'm going to take part of it back, because I teach during the systemized program founders how to delegate the right way, in a way that it means they could go focus on the next big thing. If a founder gets to the stage where they go, I haven't got anything else to do around here, terrific. You're now in a position to exit and your business is gonna scale and you're gonna make a lot of money. But what you can't do is is continue to hold on to a bit and scale your business. It just doesn't work.
Chris:Okay. You talked about one thing I had to ask you about is exiting. When are you ready to exit your business as a founder? Because some founders wanna hold on forever. It's their baby.
Chris:They don't wanna let it go. But even for that founder, what would you tell them? You know, like, hey, you're actually ready to exit now.
Stuart:So I think a founder has to get into their own head that they're ready to exit. This is why I'm talking about team so much to them because you get a team, you get them to do your job, their job for you on your behalf. Once you've got to the point where they are running your business, you're ready to exit. Now I'm working with a couple at the moment and we've got an eighteen month plan, and they're in the process of running that eighteen month plan to exit. They discovered a problem with one of their children.
Stuart:Their child was sick, they needed to be able to spend time with that child. They could not have had the time with their child, and the child is now thankfully much better and is beginning to recover and, but they could not have spent the time they needed with their child if they had not been starting down this process, because they had a, there was too much dependency on them in the business, they have started the process of being able to delegate so that other people are able to run the business. So they took time with their child, they went on a three month holiday to Canada, they've had a fabulous time. They've come back, and they said we could never have done it if we hadn't started this process. Chris, I think the problem that most founders feel is they don't recognize that one day these sort of problems will come along.
Stuart:And they've held on and held on and held on. But unfortunately, there is never a good time to turn around and have a problem with your family. There's never a good time to have sickness. There's never a good time to have something else. So how do you know that you're ready to exit?
Stuart:Too many founders hold on too long but too many founders are never ready anyway in case there's a knock on the door and it's a competitor saying I want to buy you and too many founders are not ready just in case there's a problem around the corner where they need to say I need time for my family, I'm just going to let go for six months while this thing runs itself and I'm happy to let it run. So get ready to exit from the day that you start because you don't know when that tragedy, when that difficulty, difficulty, when when that that knock on the door to ask you to buy the company is gonna come. I think you should start planning your exit. If you start your business on a Monday, I start planning my exit on Tuesday.
Chris:Wow. That's a really good way to put it. Because I think if you set it up that way, you always have the right systems in place where you can check-in and out of the company and things can run without you kind of being on a flywheel where you're just nonstop going a hamster wheel. You're nonstop doing stuff. I think that that's the most exhausting part of entrepreneurship itself is always having to do something else or worry about something else.
Chris:Nothing feels better than when you can check out and you're still profitable. That's the best thing. Absolutely. Like for me personally. Perfect.
Stuart:Perfect.
Chris:All right, so we got a couple of minutes left here. I wanna hear a little bit more about you and your journey. How did you get to this phase where you're so knowledgeable and experienced to provide so much value to founders?
Stuart:So my journey started many years ago when I started, you know, at school, I was going to be a scientist, I was going to go off and discover the next great cure for the time that I was really interested in viruses. And I went off and I spent years in research. But I had two problems with that, if you like, one of which was my head was always filled with buzzy new ideas, I was always going off and doing the new thing. And also I kind of realised I didn't particularly want to end up in a lab for the rest of my life, was too interested in going out there and doing things. So I left and I started a business and then as I said that didn't go as well as I might have liked, but I got through, I muddled through, did another one that was muddling through and it was at that point that I thought do you know something, I need to learn how to do this properly, I need to go back to school.
Stuart:So I found mentors around me, who could actually teach me the stuff that they knew that they'd done successfully. And I basically spent time with them. So in the third business I built, I would go and spend time with mastermind groups, mentors that I found, sit there and listen to them and then go back to the business go, how do I make this work in my business? So for me, everything that I now try and teach people, everything I now try and help them with is based upon the fact that I made all those mistakes myself. And I don't want anybody else to have to make those because frankly, they hurt.
Stuart:And they don't make you happy when you have to sort of reverse stuff. They don't make you happy, like I said, when you hire people, then you don't give them the jobs and then they quit on you and you go, but they were the right person but what did I do wrong? Why do they no longer want to be working here? And the answer is because you never told them you were interested in them doing your job for you eventually. You just let them sit in a corner thinking, why is he bothered with me?
Stuart:I've got all this potential, he doesn't even talk to me, you know. So, Chris, I kind of learned all of this because I made so many mistakes. And by making the mistakes, I don't want anybody else to make their own mistakes. So I've got a bunch of burns. I've got a bunch of really bad scars.
Stuart:And I'm basically trying to say to people don't do that because it just doesn't work.
Chris:I I love your perspective on that, especially about the mentors and the training. It's just, it's truly priceless in my opinion. Because the things you can learn from other people that have done what you want to do, you just, no matter how much it costs, I think it's worth paying that cost. Especially if it's somebody you know has done and all of that stuff, verifying everything. It's just it's absolutely incredible how valuable that is.
Stuart:So, man,
Chris:you gotta let the people know where they can find you. Where can the founders check out your systems?
Stuart:So you can find me on the web. I'm on LinkedIn. I'm just Stuart Webb on LinkedIn, but you can also find me at systemizesystemise.mesystemize.me. Come have a look. It describes the program.
Stuart:We take people through a twenty six week program, thirteen weeks helps them to install these five pillars that we've talked about the sort of the clarification of the vision, the lead flow, the delivery, that building a cohesive team, then all around innovation. And then in the next thirteen weeks, we've spent time with you building and understanding the data from your business. We then analyze that and say, these are the growth levers, let's go after the growth levers and really get you into a position where you can scale your business to something so sizable. And you know, as I said, that leaves people with the sort of the ability to either go raise more money, so we work with some people to raise money, or to start planning their exit. And we've got years of doing that now.
Stuart:I've been doing this for a few years, a number of really happy customers. So systemize, systemise.me.
Chris:Alright. Sounds good. Stuart, thank you for being on the show.
Stuart:Chris, thank you. I've been it's been really good fun. It's been really good fun.