Quick Hits

1. 🧗🏻Labor costs continue to be a significant challenge for U.S. small businesses, despite indications of slowing wage growth.

2. ✨So many applications… 77% of small businesses have integrated AI into their operations, marking a substantial shift toward AI utilization.

3. 🔩 💪🏻**Optimism Across Key Industries** with ****Manufacturing topping the list.

Deep Dive: Why You Need to Get Ruthless About Your Team

(Or Stay Small Forever)

I spent years keeping the wrong people in my business. People I liked. People who'd been with me from the start. People who worked hard.

And it nearly killed my company.

If there's one thing that separates owners who break through growth barriers from those who stay stuck, it's this: the willingness to be ruthless about who's on their team.

Sounds harsh? Maybe. But it's the truth most business coaches won't tell you.

The Loyalty Trap

When you start a business, you hire people you know. People who take a chance on you. People who work extra hours to make it happen. You develop loyalty to them.

That loyalty is admirable. Until it's not.

Around $3-5 million in revenue, something changes. The business needs different skills. Different mindsets. Different capabilities. But those early employees often can't—or won't—change with it.

That's when most owners get stuck. They try to force people who were perfect for a $1 million business to run a $5 million business. It doesn't work.

The Three-Month Rule

One of the toughest lessons I learned was this: when you hire someone for a key position, you have three months to decide if they're right for the role.

Not six months. Not a year. Three months.

Yes, that sounds brutal. But here's why it matters:

1. The wrong hire doesn't just fail to move you forward—they actively hold you back

2. The longer they stay, the more damage they do to your systems and culture

3. The cost of "giving it more time" is far higher than the cost of starting over

4. Waiting only makes the eventual separation more painful for everyone

Most owners I coach hang on to people for 2-3 times longer than they should. They know something's wrong, but they keep hoping it will magically improve.

Signs You Need to Get Ruthless

How do you know if you're being too soft? Look for these warning signs:

• You're making excuses for someone's performance ("they're just having a tough time")

• You're doing parts of their job because it's "faster" than training them

• You've been "meaning to have a talk" with them for months

• You find yourself hoping they'll quit so you don't have to fire them

• You've restructured your company to work around their limitations

If any of these sound familiar, you're probably trapped in the loyalty cycle that's keeping your business small.

My Ruthless Awakening

At my company, we hit a wall around $7-10 million. We had a team of amazing people who'd helped build the company. But as we grew, something wasn't working.

The people who were heroes in the early days—the ones who would jump in and fix any problem—couldn't build the processes we needed to scale. They were too attached to being the hero. Too resistant to documentation and systems.

I spent years trying to coach them into their new roles. Years hoping they would change. Years watching our growth stall.

Then I finally got ruthless. We changed out over 50% of our leadership team in about two years. It was the hardest thing I've ever done professionally—and the best decision for the business.

Almost immediately, we started growing again. The new team members brought exactly what we needed: process-building skills, leadership experience, and the ability to build teams under them.

How to Get Ruthless (Without Being a Jerk)

Being ruthless doesn't mean being cruel. It means knowing exactly what your business needs at this stage of growth and being honest about whether someone fits that need. It means setting crystal-clear expectations when you bring someone on, rather than hoping they'll figure it out. It means giving direct feedback early and often, not waiting for quarterly reviews to address problems.

Most importantly, it means making decisions based on actual performance, not potential or history or how much you like someone. And when it becomes clear someone isn't right for their role, it means moving quickly rather than dragging things out for months or years.

The irony is that being "nice" by keeping the wrong people is actually cruel—to them, to your other employees, and to yourself. You're forcing everyone to live in a state of underperformance and frustration.

The Freedom Payoff

Here's what happens when you finally get ruthless about building the right team:

• You can delegate with confidence instead of constantly checking work

• You spend time on strategy instead of fixing problems

• Your business runs smoothly even when you're not there

• You can finally focus on the parts of the business you actually enjoy

• You stop dreading Monday mornings

In short, you build a business that works without you constantly having to monitor it.

The Brutal Truth

If you want to build a business that runs itself, you need people who can run parts of your business better than you can. Finding those people means:

1. Hiring carefully

2. Evaluating quickly

3. Deciding ruthlessly

4. Moving on when necessary

Everything in your business is your fault. You either hired it, did it, or allowed it to happen. If your team isn't right, that's on you to fix.

The question is: Are you willing to be ruthless enough to build a business that gives you freedom? Or will you stay small forever because you can't make the tough calls?

In this episode of Small Business Black Holes, Alan speaks with Rachel Pastor and Tiffany Hurd, representatives of Golden Rule, about their innovative approach to psychedelics as wellness products and their journey building a business in a rapidly evolving legal landscape.

What You'll Learn:

• How microdosing protocols work for business performance, from dosage amounts to frequency

• The science behind neuroplasticity and accessing flow states through controlled substance protocols

• Why psychedelic businesses face unique banking and tax challenges similar to the cannabis industry

• How to navigate regulatory compliance while building a sustainable business model

• The future landscape of psychedelics in healthcare, from FDA approval to therapeutic applications

• Why education and community support are crucial elements for success in the psychedelics industry

• How to maintain profitability despite tax limitations and regulatory hurdles

• The strategic advantage of early market entry in an industry projected to reach $3.3 billion

Check Out Owner Institute

Want to learn more about building real owner independence and wealth? Check out our programs at ownerinstitute.com.