257: The Right Way To Outsource Your Business With Nathan Hirsch

257: The Right Way To Outsource Your Business With Nathan Hirsch

Today, I’m really happy to have Nathan Hirsch on the show. Nathan is the founder and CEO of FreeeUp, a platform that connects businesses to freelancers and virtual assistants that specialize in ecommerce and digital marketing.

In his prior life, he bootstrapped 2 multi-million dollar businesses and at one point he was managing over a half a million products selling on Amazon with over 1000 suppliers.

In this episode, you’ll learn the best way to scale your ecommerce business and how to outsource.

What You’ll Learn

  • How to manage your products and suppliers
  • The best tasks to outsource
  • The most common tasks that everyone should offload to a VA
  • How to hire and integrate freelancers into your Amazon business
  • The biggest issues Amazon sellers run into while outsourcing
  • Hiring freelancers vs employees

Other Resources And Books

Sponsors

Klaviyo.com – Klaviyo is the email marketing platform that I personally use for my ecommerce store. Created specifically for ecommerce, it is the best email marketing provider that I’ve used to date. Click here and try Klaviyo for FREE.
Klaviyo

Privy.com – Privy is my tool of choice when it comes to gathering email subscribers for my ecommerce store. They offer easy to use email capture, exit intent, and website targeting tools that turn more visitors into email subscribers and buyers. With both free and paid versions, Privy fits into any budget. Click here and get 15% OFF towards your account.
Privy

Avalara.com – Handling sales tax is complicated. Fortunately, Avalara simplifies sales tax with real-time tax rate calculations and automatic return filing. And the best part is that Avalara already integrates with your existing accounting, e-commerce and marketplaces like Amazon, so it’s super easy to setup. Click here and get a FREE TRIAL.

SellersSummit.com – The ultimate ecommerce learning conference! Unlike other events that focus on inspirational stories and high level BS, the Sellers Summit is a curriculum based conference where you will leave with practical and actionable strategies specifically for an ecommerce business. Click here and get your ticket now before it sells out.
Sellers Summit

Transcript

Steve: You’re listening to the My Wife Quit Her Job Podcast, the place where I bring on successful bootstrapped business owners and dig deep into the strategies they use to grow their businesses. Now today I’m thrilled to have Nathan Hirsch on the show. And Nathan is the founder and CEO of FreeeUp, one of the premier e-commerce outsourcing platforms around. And today we’re going to talk about the best ways to find help for your business.

But before we begin, I want to give a quick shout out to Privy who is a sponsor of the show. Privy is the tool that I use to build my email list for both my blog and my online store. And right now I’m using Privy to display a cool wheel of fortune pop up. Basically a user gives their email for a chance to win valuable prices in our store. And customers love the gamification aspect of this. And when I implemented this form email signups increased by 131%.

You can also use Privy to reduce cart abandonment with cart saver pops and abandoned cart email sequence as well at one super low price that is much cheaper than using a full blown email marketing solution. So, bottom line, Privy allows me to turn visitors into email subscribers and recover lost sales. So, head on over to Privy.com/Steve and try it for free. And if you decide you need some of the more advanced features, use coupon code MWQHJ for 15% off. Once again, that’s P-R-I-V-Y.com/Steve.

I also want to give a quick shout out to Klaviyo who is also a sponsor of the show. Klaviyo is the tool that I use to build real quality customer relationships with my e-commerce store. And because all my transactions and email correspondence is tracked in Klaviyo, I can easily build meaningful customer relationships by listening, understanding and taking cues from my customers and delivering personalized marketing messages.

So for example, with one click of a button, I can easily send a specific and targeted email to all customers with a lifetime value of over $100 who purchased red handkerchiefs in the past year. Now, it is for this reason why over 10,000 brands have switched over to Klaviyo. And you can try them for free over at Mywifequitherjob.com/K-L-A-V-I-Y-O. Once again that’s Mywifequitherjob.com/K-L-A-V-I-Y-O, now on to the show.

Intro: Welcome to the My Wife Quit Her Job Podcast. We will teach you how to create a business that suits your lifestyle so you can spend more time with your family and focus on doing the things that you love. Here’s your host Steve Chou.

Steve: Welcome to the My Wife Quit Her Job Podcast. Today I’m really happy to have Nathan Hirsch on the show. Now Nathan is the founder and CEO of FreeeUp, a platform that connects businesses to freelancers and virtual assistants that specialize in e-commerce and digital marketing. And in his prior life, he bootstrapped two multimillion dollar businesses. And at one point, I think he was managing over a half a million products selling on Amazon with over 1,000 suppliers. And how is all this possible? It is because Nathan has mastered the art of outsourcing his e-commerce businesses. And with that, welcome to show Nathan. How are you doing today man?

Nathan: I’m doing great Steve, how are you?

Steve: I’m good. How are you?

Nathan: Great. Thanks so much for having me.

Steve: Yeah, thanks. Thanks a lot for coming on Nathan, because you have a really interesting story. And I’m actually very curious about your background and your path on how you kind of started that first company to your other e-commerce company and now to starting FreeeUp.

Nathan: Yeah, so growing up, my parents are both teachers, and I kind of had that mentality that I would go to school, get a real job, work for 30 years and retire, just like they did. And I had all these summer jobs. And I quickly realized how much I just hated working for other people. So when I got to college, I kind of looked at it as a ticking clock. I had four years to figure out something to create some business or else I was going to get thrown into the real world and be miserable for the rest of my life. So I started hustling and buying people’s textbooks to make some extra side money. This was back in 2008 before there were courses and gurus and everything about Amazon, no one really knew what Amazon was at the time.

And I started experimenting selling books on Amazon, and then realizing that they were so much more than a bookstore. And just from trial and error, I mean, I tried sporting equipment and DVDs and computers and stuff that a normal college guy really likes, and I just failed. And the only thing I could get to sell were these books until I came across the baby industry. And that’s when my business really took off. So if you can imagine me selling millions of dollars of baby products as a 20 year old single college guy, that was me.

Steve: Where did you get the products in college?

Nathan: So it was all research. I mean, I didn’t have a warehouse, I didn’t have any money to buy inventory. So I came up with the concept of drop shipping years before I even knew it was called drop shipping, the idea that I could sell something I didn’t have at a marked up price. Whenever I got an order, transferred over to a supplier, a retailer, a vendor, that would ship it for me and I would make the difference. And that was really the concept. I would find these baby products online. There was no SEO or creating listings or figuring out Amazon’s algorithm back then. It was more post stuff on Amazon and see what sells and what doesn’t.

Steve: I’m just curious, like when you were contacting these drop ship companies, why would they take a chance on a college dude to establish relationship with?

Nathan: Yeah, it’s a great question. I mean, I started off with these smaller retail sites that were kind of the in between of wholesale and retail. And as I started to sell products from there, I started to go around the websites and contact the manufacturers and say, hey, we’ve had some success selling these products, or hey, we think we have a lot of potential. And it’s kind of like how I do sales outreach now to get on podcasts. You see what works and what doesn’t work and you keep tweaking your pitch until you find that value proposition. And back then that value proposition was, hey, you don’t understand Amazon, there’s a lot of potential there. We have this store with great reviews. We have great customer service; we’ll make it easy for you. We have a process; all you have to do is give us access to your inventory.

Steve: I’m just curious what your views are on this Amazon drop shipping business today. It’s been a couple years since you’ve been out of it, right?

Nathan: Yeah, I stopped last January. I mean, it’s definitely tough. It’s a much different ballgame than it was back in 2008. I did it for eight years and had a lot of success. But at the same time, I have a lot of clients now that do drop shipping, and they hire freelancers and virtual assistants from FreeeUp, and they have a lot of success. And it all really comes down to quality assurance. Amazon is always changing the game on the merchant fulfillment side, whether it’s your cancellation rate, your return rate, your defect rate, all that stuff is incredibly important. And the people that succeed are the ones that are very strict with their suppliers.

You have to be able to do XYZ. And they’re pretty quick to stop working with people that — or working with suppliers that won’t hit those metrics. And that’s what we did back in the day. I mean, back when I started, it was me and two other people on every listing. Now you have a lot of competition out there. And Amazon has gone pretty overboard on the quality assurance as well. So it’s a lot harder, but it definitely still exists.

Steve: So let’s talk about your drop shipping company a little bit. How did you possibly manage? So were those numbers, accurate, 500,000 products and 1000 suppliers?

Nathan: Yeah, that was at our peak. We did about five to $6 million of revenue a year for 7, 8 years.

Steve: So how can you possibly manage that many products? And kind of what was your process for doing so?

Nathan: Yeah, so when you’re doing drop shipping, there’s a ton of moving parts, right. You got to answer every customer service email, you have to update prices, you have to change inventory when stuff goes in and out of stock. So we really used virtual assistants that we would teach to specialize on one thing. We would have a VA that would log in every morning at 9am. And they would adjust prices, or they would get emails from manufacturers and say, hey, we need to get these products down.

We created an onboarding team. So whenever we would get a new manufacturer, they would have a process that they would take them through. So we would get their files and their pictures. And we would go through and say hey, these are the products we definitely don’t want to list on Amazon. Maybe they were too big, or they had a risk of harming someone, whatever we thought it was to try to get only the best products up there, and then once they were up monitoring what was good, what was worth selling, and what was kind of a waste of our time, to take them down.

So we started off very manual. I mean, I’m not a developer. So it was all manual processes. And as we got deeper into it, probably year four and five, we started hiring developers to create a software where the manufacturers could send us files to upload into the software. It would actually monitor the prices, it would monitor the inventory, and it would relay it to Amazon’s API. So it’s kind of cool how it went from a lot of manual process to a combination of manual and automation.

Steve: So I don’t know how good your memory is. But if we could kind of rewind back to the beginning, like what were some of the first things that you knew you need to outsource? And how did you kind of chronologically get to where you were at your peak?

Nathan: Yeah, so customer service was always the core of this. I mean, I had a lot of customer service training in the internships that I had. And when I came to Amazon, that’s one thing that I wanted to really take pride in. And with drop shipping, it’s tough; you don’t have a lot of control. So having great customer service is key. And we used to have it so clients or customers will get responses within hours or minutes. And that was one of the first things that I had to take myself out of because you’re getting emails 24/7, seven days a week. And I had to get someone that could do it at my level without me having to be there so that I could focus on the sales, getting new manufacturers and expanding the company. So the first thing was really customer service to get off my plate. And I still remember that first day that I woke up and I said, wow, I don’t have to answer any customer service emails today.

Steve: Can we kind of talk about the process there and the different types of help that you can get to do that, specifically on the lines of getting someone local versus someone in the Philippines and kind of what is your process for vetting a customer service agent?

Nathan: Yeah, it’s very similar to — I have assistants now that monitor my Skype, my emails, our live chat 24/7, and it’s really that same process. I’m a big fan of going remote. I mean, I’m biased; I opened up an office with the Amazon business around year five, had it for a year and a half and actually got rid of it because I realized that I didn’t love driving to work every day. I thought bringing people together actually caused more drama. I was competing with a lot of other businesses for that same talent that was in my town or town around me. And I thought that I kind of lost a lot of that competitive advantage that I had being a remote business. So I tend to hire remote now.

And back then, I mean, I really structured it so I had a US customer service rep who would handle a lot of the higher level issues, a lot of the management, and then I would have people in the Philippines that would handle a lot of the repetitive tasks, the tracking, the questions, hey, can you tell me about this product. And what I would do is create a blueprint of hey; here are all the different types of situations that we would get, the returns of tracking. And I would kind of break them down, hey, here’s a return that’s not our fault, here’s a return that that is our fault, or manufacturers fault, which really means our fault.

And I would kind of break it down to, hey, here’s canned responses for each one and here’s the level of person that can handle these type of emails. So once it got to past a certain point, that’s when it would get forwarded to that US customer service rep would be able to maybe talk to them on the phone or, or calm down an upset customer. And there was always the point where if the person was really upset, it would get escalated to me. So having that breakdown of all the different types of situations that come in, and as you find new ones, you can always add more situations, and really leveling out to who goes to what is incredibly important in terms of how to vet them.

For me, I’m looking for someone who’s really passionate about customer service. And those type of people are hard to find, the people that no matter how angry the customer is, no matter how irrational they are, they don’t get aggressive, the meaner they get, the nicer that customer service reps get, that is really what I’m looking for. And obviously the other factors like being able to write English at a high level, being able to clearly communicate, showing up on time, stuff like that.

Steve: How do you test that personality attribute? Do you like yell at them during the interview or personality test or how do you do that?

Nathan: Yeah, it’s a great question. So with FreeeUp, and it’s the same hiring process I had back with my Amazon business, we quickly realized that you can’t just vet people for skill. Too many people, they have great resumes, and then you hire them and it kind of blows up in your face. So we like to vet for the attitude and for the communication. And the attitude is where that one on one interview comes in.

And we like to challenge people. We like to have people really prove to us that no matter what we say, and we’re not yelling at them, they’re not going to get aggressive, they’re not going to get agitated, that they’re actually that type of personality that we want to work with. Because I think we’ve all worked with someone who has taken something in the wrong way or they’ve taken something personally, and that kind of stuff really doesn’t work in customer service. The last thing that you want to do is find yourself in the middle of a customer and your customer service rep. So you really have to find the right type of person that no matter what you say, no matter how you challenge them, they’re always going to get nicer and nicer and more rational.

Steve: Can you comment on why you have that US representative and what the breakdown is and whether you have considered having that US job in the Philippines as well?

Nathan: Yeah, so with FreeeUp, we don’t have a US representative. My entire team 12 people that monitor all my Skype and emails, they’re all in the Philippines. The main reason we had it with the US side is when I was in college, I didn’t know anything about outsourcing. The first people I hired were in the US, they were other college kids. And when I graduated, I took the US person and we made them a full time customer service rep at our company. And then when we found out about outsourcing and the Upworks and the Fiverrs and we added people in the Philippines, we didn’t want to fire that person. We just escalated him to the higher priority issues and then we inserted the people in the Philippines underneath. I’m a firm believer that you can have an entire customer service team in the Philippines. It’s not for everyone, but I have a lot of large e-commerce sellers that do it just like I do it for FreeeUp.

Steve: Okay. And then the pros and cons are as far as your experiences go.

Nathan: Yeah, I mean, the pros are obviously price point and having someone that can work different hours. I mean, for me, I have someone that works while I’m sleeping, and then it’s no big deal. It’s tough to get someone in the US that’s going to work overnight. I mean, the cons, it is more of the culture than anything else. Because I would put my top customer service reps against any US customer service reps out there in terms of ability to speak English and communicate and problem solve.

That really depends on the person more than where they’re from. But there’s always going to be those culture differences and it comes up a lot of times in customer service where a client might say something, and it gets a little misinterpreted on the other side by the non US rep. We kind of treat those as lessons. And it’s pretty easy to jump in and say hey, my assistant is in the Philippines, let me just clarify what’s going on here. But that’s definitely the downside.

Steve: What about voice customer support? Do people tend to — do they mind the accent?

Nathan: That’s the thing. With the people in the Philippines, for the most part, their accent is not as prevalent as let’s say someone from India or Pakistan. So it’s not as big of an issue. Of course, there’s always going to be someone who only wants to talk to someone in the US. But again, I have lots of clients that do phone support that will hire four people in the Philippines and the clients on the other end have no idea.

Steve: Okay, so customer support it sounds like was the very first thing that you outsourced? And then once you had that done, what was kind of like the next step in your Amazon business that you wanted to outsource?

Nathan: Yeah, two things. One was bookkeeping. I used to pay all my manufacturers via credit card. So at the end of every month, every quarter, I would have these sheets of just credit card invoices or bills that I would have to go through and input into QuickBooks, which was a huge waste of time. I remember my business partner, Connor and I used to sit there and he would read me a number and I would enter it in. And we would do that for hours every month, until we actually outsourced that and got someone else to put it into QuickBooks. And the other side was updating prices and inventory. I mean, it just got out of control where we were working with so many manufacturers that we were always changing things that we hired a small army of people in the Philippines to update everything as soon as emails came in.

At first we had an inbox where manufacturers knew they could email anytime anything was out of stock or a price change. And the VA would go in, they check the email, they updated on Amazon and mark it as red. And that eventually turned into our software where the person would get the email, enter in our software and move on to the next one, which is a lot easier for the manufacturers that didn’t go to our software directly.

Steve: So on the lines of bookkeeping, are you just going out and looking for like accounting firms? Because I know there’s a bunch of services out there that will find you a bookkeeper. Is that process different?

Nathan: Yeah, it’s a great question. For what I was doing, it was just data entry. So we just hired someone to put it in, we had a system, hey; do A, B, C, D, and then you were done. On FreeeUp, I mean, I have a US accountant, I have a US bookkeeper and then I have the person who handles our billing, a team of people that are in the Philippines that do a great job. And that’s a lot of times how I encourage clients to set it up, to have a US accountant, but have someone different for the actual bookkeeping, and we have a lot of non us bookkeepers that are very good. And they’re a lot more than data entry, they actually understand the US laws and US taxes and how to organize everything. So it’s not a big mess when you’re trying to do your taxes at the end of the year.

Steve: And in terms of just giving them sensitive information, was that something that you had to get over?

Nathan: Definitely, I mean, when I first — my business is growing, right. I’m 20 and it’s time for me to pay taxes. And I meet with my accountant or an accountant for the first time and the first thing he asked me is when are you’re going to hire your first person? And I kind of shrug them off, like why would I do that, they’re going to steal my ideas, they’re going to steal my information. I’m going to have to teach them, it’s going to mean money out of my pocket, just endless excuses that I think a lot of entrepreneurs have. And he just laughed in my face. And he pretty much said, you’re going to learn this lesson on your own.

And sure enough, my first busy teasing came around, and I just got destroyed. I was working 20 hours a day, answering every email, filling every order. And come time for January, I kind of realized I have to get over this fear, I have to start hiring people. And one thing that I’ve kind of realized over the years, and I tell clients this all the time, there’s always going to be a risk, right? There’s nothing I can do to make that risk zero. Even if you hire your best friend to sit right next to you, there’s always a chance to do something stupid. But I’ve been hiring for eight plus years, I’ve never had a serious issue. We bill 15,000 hours a week. I’m sure eventually something will happen, because that’s just real life. But the percentages are a lot smaller than people think.

I mean, these freelancers, these virtual assistants care a lot more about providing for their family, growing their freelance business than they do about stealing your information. And you can have them sign every NDA in the world, but are you really going to chase them across the Philippines to enforce that? Probably not. And what I do recommend is just building relationships with the people that you’re giving sensitive info to because there’s really no substitute for that. And I’ve had people that I fired who have quit on me, and I didn’t want to hurt them. They didn’t want to hurt me because we kind of built that relationship. So that’s kind of my advice.

Steve: I guess what I’m specifically asking you is like, is there a division of what you give to your Filipino bookkeepers versus the US? Because what you don’t want is like your numbers getting screwed up and not having anyone accountable for it, right?

Nathan: Yeah, there’s really not. I mean, on the back end with whether you’re using PayPal or a credit card or on Amazon, you can always give user permissions. And I essentially give them permission so they can view stuff and get access to what they need for the bookkeeping, without actually changing or taking money or anything like that.

Steve: And in terms of managing your entire product portfolio, do you just kind of split up all your products into categories or something and then you just form them out to different Vas?

Nathan: In terms of like managing it from the manufacturer side?

Steve: Yeah, like managing 500,000 products? How is that even structured? Let’s say you have like 20 VAs, how do you have them — do you just have each one of them handle like 100,000 or 50,000?

Nathan: Yeah, so we would mark our best manufacturers. So those are the ones that we would give to the people who have been there the longest. And then from there it was every single manufacturer was set up differently. Some of them, they never went out of stock. They made everything very custom made. So those were very low maintenance, maybe we would check in with them every quarter. And then you’ve got the ones that are updating prices all the time, and you have someone that’s constantly checking those emails and updating, and then you have others that are once a week or once a month. So for us, we’re really structuring it by the type of manufacturer and how often they change prices and inventory, then more of that, okay, you got a rep with us that’s in charge of 50 manufacturers a piece.

Steve: Can you also comment on freelancers versus just having someone on your staff because the term Freelancer implies that they have a whole bunch of other different customers that they’re kind of handling at the same time, right?

Nathan: Right. And this is kind of how I structure my business. My day to day operations, the customer service, the billing, that’s all outsourced. These are people that are part or full time. But for the most part, they’re working just with me and that’s kind of in substitute of having the office with 10 full time employees, but all the higher level stuff, the writing for my blog, the running my Facebook ads, all that is US either freelancers, or agencies. And most of the time, I don’t need them just dedicated to me. It’s totally fine if they have other clients, as long as my work gets done at a high level. So that’s how I kind of structure my business. The things that I need full time that are more repetitive, that are day to day, I’ll outsource to the virtual assistants. And the stuff that’s more project based or more high level, but not full time, that gets put on to the freelancers and to the agencies I use.

Steve: One other concern that I just thought of is if you want them to help you out with their Amazon business, they’re going to need a login. And if they’re logging in from like all over the place, and perhaps they use an IP where someone else got banned, is there any risks there?

Nathan: Yeah, I’ve been hearing that rumor forever. To be honest, I’ve yet to actually see that happen. And I’m not saying it doesn’t. But I work with thousands of Amazon sellers that use VAs that work for lots of other Amazon sellers both inside and outside FreeeUp, and I’ve yet to ever see that happen. And I think from Amazon side, they expect you to hire people, they don’t expect every amazon seller to be a one man operation. Yes, you should give the user permissions and make sure that you’re not giving someone the main access. And if you want to take it a step further, you can have that hide their IP and give them a VPN. But I think it’s a concern that’s been well overblown in the industry. I’ve really not seen that happening. I know with my own Amazon store that I did it for eight years with VAs. They were working for lots of other sellers at the time as well.

Steve: Okay. Okay, so as far as you haven’t seen anyone get affected in that way?

Nathan: I really haven’t.

Steve: So what are some of the biggest issues specifically in the e-commerce space that you’ve seen people who’ve been hiring freelancers, like what are their main issues and how do you overcome them?

Nathan: I think the biggest issue is setting expectations right from the beginning. I mean, you have to remember that freelancers like you said, they work for a lot of different clients. And what’s good for one client might be bad for another, what one client really likes might be another client’s pet peeve. And I see too many people that will hire a freelancer and just get them started with the work and then check in three weeks later or whatever it is, and they’re not happy with it, for whatever reason. And for the most part, that’s all about setting expectations up front, hey, this is how we’re going to communicate, this is what the goal of the project is, this is what constitutes success or failure.

I even tell the freelancer what it’s like to work with me because I know that I’m unique compared to other business owners, I talk fast, I move fast I, I don’t do voice calls. I do keep everything in writing on Skype. So I really prepare people what it’s going to be like working with my business, working with me, and what the expectations are on that project. And the more time that you spend up front before actually getting started setting expectations, the more time you’re going to save down the line on the he said she said or not getting the type of work that you want.

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One thing I also want to ask you about is just talking about the cultural differences in a Philippines employee as opposed to like a US employee, for example, and how to navigate that. So what are some things to expect? And what are some things that you preempt we do to make the transition easier?

Nathan: Yeah, I learned this the hard way back in the day. I hired this really awesome lady Cheeks [ph] who still works with me today seven, eight years later, whatever it is. And after her, I made a bunch of hires; I invested my time, my money into training them, and getting them set up, only to have people quit on me. And I couldn’t figure out why is everyone keep leaving; I’m treating them the same way as I’m treating the people in the US. They don’t seem to be quitting on me. And I really just asked Cheeks, I said, what’s going on? Well, why do people not want to work with me? And she told me that the way I talk is very direct.

And people in the Philippines, you can’t generalize everyone, but for the people that I was working with, and my personal experience with people in the Philippines, they tend to be more emotional, they tend to take criticism a little differently than a lot of people in the US. So what I had to do was change my approach. I had to change how I would talk to people, how I would give feedback, how I would give directions. And just by making those small changes on how I would send out an email or how I would send a Skype message or how if someone did something wrong, I wouldn’t call them out in a group with other people, I’d keep it more private. Stuff like that went a long way into decreasing my turnover. So that’s one of the biggest things that I’ve seen is they just tend to take things a little bit more personal, less on the business and logical side, if that makes sense.

Steve: Interesting. And then what are some other cultural differences that just kind of affect the day to day? So why would you go for — I guess, aside from the price, what are some of the pros and cons?

Nathan: Yeah, I personally have had a great experience hiring people from the Philippines. I think they’re really hard working, I think that they’re looking for an opportunity, that they want someone that they can — they want something reliable that they can grow with and be a part of, and I think what I try to do is make them feel a part of the business because at the end of the day, that’s where they are. FreeeUp is growing that and they’re growing too. And I think getting more into that mentality where you might have someone from the US that is just interested in the paycheck, but could still do a good job for you. If you get someone from the Philippines for the most part, I try to make them feel included, make them feel like it’s a family, make them feel like I had their back at all times. And that’s how I’ve seen a lot of success. And yeah, like I said, they can be incredibly hardworking and dedicated to you if you treat them correctly.

Steve: How is the vetting process different?

Nathan: So what I mentioned with FreeeUp is we vet people for skill, attitude and communication. So we get thousands of applicants every week, we take one out of every hundred, and let them on our platform. For skill we have different skill tests that we give. If someone’s a graphic designer, we look at their work, if someone’s an Amazon expert; we have the Amazon tests that we give them. And we’re not looking for someone who’s a 10 out of 10, you can be a seven out of 10 or a four to 10 as long as you’re priced accordingly, and you’re honest about what you can and cannot do. So the first part is skill.

The second part is attitude, which we briefly touched on before. We want people who are passionate; they’re not just in it for the payments. They actually care about their clients; they don’t get aggressive the second that something doesn’t go their way. And we do one on one interviews for attitude.

Steve: I guess I’m just trying to get the distinction between the — because someone who’s using a Philippine worker for the first time, they might be kind of surprised, or there might be some ways that they interact with you that are kind of different. And so I’m just trying to ask you what the expectations are. It’s funny, I had John from Onlinejobs.PH on the podcast a while back, and we were just talking about some of the cultural differences and how to navigate those. And that’s what I’m trying to get out of you.

Nathan: Yeah, I mean, I kind of briefly touched upon it. It’s weird. I’ve had like a very great experiences working with people in the Philippines, I haven’t seen something where it’s like, okay, you need to watch out for this. A lot of it too is just talking to the people that you’re working with and saying, hey, what do you like? What does not make sense? What’s confusing? How can I communicate better? And that’s how I’ve kind of figured out how to work with people, regardless of their location?

Steve: Or do you work with them in the exact same way as you would a US employee?

Nathan: For the most part, yes. I mean, I tend to talk to everyone, no matter where they’re from in that same light. And I tend to only hire people that can work with me in my environment. I try to stay away from people that wouldn’t be a good fit for the kind of way that I work with them because I mean my team right now is 40, 50 plus people. If I have to work with everyone different, I’m going to go crazy at the end of the day. So I try to find people that are a fit for me rather than me trying to become a fit for everyone else.

Steve: Well. So one thing you mentioned earlier is you’re less direct with your Filipino employees, right? So can you give me an example of how you would soften the blow on — so I mean, apparently you do treat them slightly differently, right, just based on that?

Nathan: Yeah, it’s funny, once I got that feedback and I started to adjust how I would talk to them, I kind of adjusted how I talk to everyone to kind of more like preventative maintenance. But yeah, so I had an assistant who I hired, he was really smart. And he kept making these small little mistakes. And I kept tagging him in a group chat, like, hey, watch out for this, watch out for this. And he couldn’t, for whatever reason that just wasn’t effective. And I finally pulled him aside and was like, hey, what’s going on? How can we keep making these errors? I keep calling you out. And he pretty much said that he was embarrassed that I kept calling him out in front of other people. And it made him nervous, and it made it so he couldn’t focus and so he couldn’t work.

And so what I would do separately is say, hey listen, you’ve done a great job on XYZ. Here’s a few notes on things that weren’t done properly. Let me know if you have any questions. You’re doing great, just kind of keeping it much more positive, if that makes sense.

Steve: Can we talk about outsourcing tech, because I know a lot of people in the US including my students, they have problems making little adjustments to their website and whatnot. And so when it comes to outsourcing tech, any tips there?

Nathan: Yeah, I mean, that’s something that I learned way back in the day, working with developers is really hard. I mean, for someone like me that’s not a developer that has more of a business mindset, trying to bridge that gap between what is going on, on the code side and what’s going on the business side is hard. For me, it’s all about communication and not assuming anything. I have two developers in India right now, one in the US and we go over things to the T. What might be assumed on the business side, like hey, it has to have this function for the client is not assumed on the dev side.

And what might in my mind be a small project might be a big project, or vice versa. So before we get started, we spend extra time going through everything, making sure that everything is in writing that it’s hey, this is due by x date. So there’s no confusion. For the most part, I don’t do any voice calls with my tech people. It’s all in writing. It’s all clear, ready to go.

Steve: Do you use any software to help you out to describe the app? I mean, I can’t imagine not having a voice call. Are you drawing flow charts? What does the document look like?

Nathan: Yeah, we use a software called Jira. It maps out every bug, every revision, every new update, and it really lays it out for them. Yeah, that’s what we found to be effective. I mean, for the most part, I’m not doing voice calls with anyone. I’ve found that by dealing with people from all over the world, the most effective way is to keep everything in writing at all times. So nothing gets lost, calls don’t drop out and there’s always something to reference back to.

Steve: What is your communication tool of choice? Are you using email, Slack, Asana?

Nathan: Yeah, I keep it pretty basic. I use email, I use Skype, I use Trello for projects, I use Jira for developers. And that’s really it.

Steve: Wow. Okay. And so can you just kind of describe your day to day and how you manage all your VAs. Like, what does your typical week look like?

Nathan: Yeah. So Monday morning at 10am we have a meeting with all the VAs, we go through the week before we go through what’s coming up this week. For example, I’m traveling this week. So I update them on that, the different projects that each team is working on, each one gives an update. And then throughout the week, we have different meetings. So my customer service team has a meeting, my billing team, my social media team, and my business partner Connor and I, we’ve really split up the teams. We have very different skill sets, he handles the developers, he handles the social media, the content. I’m handling the customer service, the billing, more of the business structure type things. So we split those up, we have different meetings throughout the week. And then…

Steve: So by meeting it’s not a voice meeting or?

Nathan: Nope, it’s group chats on Skype.

Steve: Group chat. Okay.

Nathan: Yeah, so we’re going through those, and then people will cover my Skype, my email and all that while I’m doing podcast, doing client calls, whatever it is, and then as issues come up, anything that needs to be handled within the next hour or so that gets sent via email, anything that’s urgent gets sent via Skype. And that’s really how we differentiate that.

Steve: And can you comment on the price difference between getting a VA in the Philippines versus the US and how much basically all the different things cost? Like, for example, how much is a customer service rep that you’d expect to pay versus a dev versus like a bookkeeper?

Nathan: Sure, so outside the USA, it’s usually in that five to $10 an hour range ballpark. There’s obviously going to be people that are cheaper or more expensive. For that mid-level, that’s kind of where you see the difference where you can get that mid-level specialist in the Philippines for maybe somewhere between seven and 15 an hour, where in the US, it’s more on that 20 to $30 an hour.

Steve: What is your definition of mid-level?

Nathan: Yeah, so basic level is people that are followers, people who can follow your systems, your processes. Mid-level are more specialists, the bookkeepers, the writers, the graphic designers, where you’re not teaching someone to be a graphic designer, but they’re not consulting with you either. They’re doers. And then the experts are that maybe 15 in non US and 25 and up US who are bringing their own expertise to the table, can console, can execute high level gameplay and stuff like that.

Steve: So we’re looking at like a price differential of like two to one then Philippines to US?

Nathan: Yeah, a lot of times.

Steve: Okay. And oh, can you comment on the writing? Like, do you ever outsource any writing?

Nathan: Yeah, if you go to the FreeeUp blog, made up of both US and non US writers. And, again, it comes down to the person more than location. We have some really talented non US writers on the blog. Do they compare to the US? Maybe not. A lot of times the US can far exceed anything they can do, but they’re very solid, especially if you’re a startup and you’re running on lean, and you need to get a lot of content out there.

Steve: Okay. So Nathan, I want to kind of end this interview with just some common pitfalls to avoid, just some general tips that people who want to outsource and try to help them avoid some of the common mistakes.

Nathan: Yeah, I mentioned the three levels. That’s where a lot of people go wrong; either hiring someone for five bucks an hour and say, hey, run my Facebook ads, run my Amazon PPC, and then they have a bad experience. Or maybe hiring an expert who has their own system and process and trying to make them follow yours. That’s where a lot of people go wrong. I mentioned the setting expectations, not diversifying. What a lot of entrepreneurs will do is because hiring is hard, so they’ll make a lot of bad hires.

And they’ll finally find someone they really like. And they’ll load that person up with everything. And it just makes your business incredibly risky. If that person quits or gets sick or you have issues with them, it can really set your business back months or years. So those are kind of the three things that I would encourage you to do is make sure you’re hiring the right level, make sure you’re setting those expectations up front. And make sure as you grow, you’re diversifying and not putting all your eggs in one basket.

Steve: And then I did want to give you a chance to talk about FreeeUp a little bit. And specifically, I’m curious how is FreeeUp different from like an Upwork for example?

Nathan: Yeah, so I used all the other platforms out there. And I really wanted to build my own that was better taking what I liked and changing what I didn’t like. We get thousands of applicants every week, we take the top 1%, let them in, make them available to clients quickly, rapid fire whenever you need them. We have clients who get started within hours or minutes of putting in their request. On the back end, we have 24/7 support to make sure that you’re taken care of. And then we also have a no turnover guarantee. If someone quits for any reason, we cover replacement costs and get you a new person right away. So that’s how we’re different, the pre-vetting, the speed, the customer service and the protection.

Steve: Interesting. How can you find someone so quickly actually, you said within a couple of hours?

Nathan: Yeah, so we’re not recruiting. So it’s not like you put in a request and we go out into the world and find them. We already have these people in our network ready to go. We get about 4,000 applicants a week to get on our platform. So we’re constantly adding people to the platform. And once you submit a request, that request is going to the people that are already there ready to go looking for work.

Steve: I see. Cool. Well, Nathan, where can people find you online if they have any additional questions?

Nathan: Yeah, go to FreeeUp.com with three E’s, my calendar is right at the top. If anyone wants to book a time with me, mention this podcast, get a $50 credit to try us out. And definitely check out the FreeeUp blog and the FreeeUp YouTube channel for a lot of other great content about hiring.

Steve: Cool. Well, Nathan hey, I appreciate you coming on the show man. It was good to finally connect and chat.

Nathan: Yeah, thanks for having me.

Steve: All right, take care.

Hope you enjoyed that episode. I’ve actually started making use of VAs in the past couple of years and it’s actually made a huge difference to my businesses. For more information about this episode, go to Mywifequitherjob/episode257.

And once again, I want to thank Klaviyo for sponsoring this episode. Klaviyo is my email marketing platform of choice for e-commerce merchants. You can easily put together automated flows like an abandoned cart sequence, a post purchase flow, a win back campaign, basically all these sequences that will make you money on autopilot. So head on over to Mywifequitherjob.com/K-L-A-V-I-Y-O and sign up for free, once again, that’s Mywifequitherjob.com/K-L-A-V-I-Y-O.

I also want to thank Privy for sponsoring this episode. Privy is the email capture provider that I personally use to turn visitors into email subscribers. They offer email capture, exit intent, and site targeting tools to make it super simple as well. And I like Privy because it’s so powerful and you can basically trigger custom pop-ups for any parameter that is closely tied to your e-commerce store. Now, if you want to give it a try, it is free. So, head on over to Privy.com/Steve, once again, that’s P-R-I-V-Y.com/Steve.

Now I talk about how I use these tools on my blog, and if you’re interested in starting your own e-commerce store, head on over to Mywifequitherjob.com and sign up for my free six-day mini course. Just type in your email and I’ll send you the course right away. Thanks for listening.

Outro: Thanks for listening to the My Wife Quit Her Job Podcast where we’re giving the courage people need to start their own online business. For more information, visit Steve’s blog at www.Mywifequitherjob.com.

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One thought on “257: The Right Way To Outsource Your Business With Nathan Hirsch”

  1. Johnnie C. Salas says:

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