FUNDAMENTAL TRUTHS OF ENTREPRENEURISM

Here’s a glimpse of what you’ll learn:

• Fabio Rosati on improving his financial literacy and achieving his first ROI
• Evolution of job search processes in recent decades 
• Aspiring entrepreneurs should focus on their contributions, not just finding solutions to a problem
• How a memorable business deal shaped Fabio's entrepreneurial perspective
• Fabio's interview questions to assess candidates' compatibility with company culture
• Who is Fabio's mentor, and what is the role of social capital in his business?

In this episode…

The standards of the 21st century would be unrecognizable to previous generations. Amid a transforming society, we adapt to technologies that positively impact outdated processes. A testament to this new era, methods for job searching have progressed — making it more accessible for candidates to apply for suitable positions. With a steady increase in entrepreneurial pursuits, what should business owners consider when hiring employees?

In this episode of The First Buck Podcast, Nicolas Cary introduces Fabio Rosati, Chairman at Snagajob, to advise aspiring entrepreneurs launching businesses in an evolving culture. Fabio also shares how the methods for job searching have evolved in recent decades, how his perspective on entrepreneurism changed upon acquiring a business deal, the interview questions he favors asking candidates and the influence of social capital in his career.

The goal of entrepreneurism is the journey — not the destination. Here are some key insights that Fabio talks about based on his journey to find success as an entrepreneur:

• While it's admirable to find a solution to a problem, your contribution is what truly matters. 
• If your business doesn’t succeed, reminisce on the journey, learn from your mistakes, and keep moving forward. 
• When expanding your team, seek talent that shares your perspective and passion, and consider the contribution they will make to your organization — as it will directly impact your company’s culture.

Resources mentioned in this episode:

• Nicolas Cary on LinkedIn 
• Sky's The Limit
• Fabio Rosati on LinkedIn
• Snagajob

Sponsor for this episode:

This episode is brought to you by Sky’s the Limit, one of the largest nonprofit programs for underrepresented young adult entrepreneurs in the US. Sky’s the Limit is a quick-growing digital platform that connects entrepreneurs with their peers, volunteer business mentors, training resources, and funding.

Our goal is to develop the social capital that founders need to chase their business dreams.

To learn more, please visit www.skysthelimit.org today.

Episode transcript

Intro  0:04  

Welcome to The First Buck Podcast, where we feature stories about entrepreneurs and the people who support that. Now, let's get started with the show.

Nicolas Cary  0:20  

Hello, and welcome to The First Buck Podcast brought to you by SkysTheLimit.org. We feature stories about entrepreneurs and the people that support them. Today we're joined by Fabio Rosati, a serial entrepreneur who has served as the CEO of Elance, Upwork and Chairman of Snagajob. Fabio is passionate about the opportunities in the employment and employability labor market by focusing on technology platforms that connect employers with talent. So Fabio, I'm so excited to talk with you today. You've had an extraordinary career, both in private and in public markets, working at the early stage and at the scaling stage. So we're gonna learn a lot. And one of the first questions I love to ask everyone though, is how did you earn your first buck?

Fabio Rosati  1:02  

Nick, I actually earned my first lira when..

Nicolas Cary  1:05  

Foreign currency, okay.

Fabio Rosati  1:08  

Lira doesn't exist anymore as it is the euro now, but I guess I was doing manual work, deliveries and yard work for neighbors, you know, classic. But my first album was when I was in college, as a DJ, I had the opportunity to DJ at a club that had just opened in Georgetown, called Cafe Med of all things. And for a while it was a lot of fun. But it also really interfered with my studies. So DJ was my first buck.

Nicolas Cary  1:36  

Got it. Okay, so from the lira to the dollar, doing manual labor to becoming a DJ, talk to us a little bit about how that transition in your sort of aptitude with financial literacy improved. And maybe talk to us about how your career that started?

Fabio Rosati  1:53  

Yeah, well, first, I should mention financial literacy. As I earned my first few dollars. I was in undergraduate business school at Georgetown, I started to invest. And I had my first financial first experience with terrible investments, I bought penny stocks. Because I found a newsletter that was advertising these companies with amazing growth potentials. And, hey, if this looked like a real good deal for me. And I pretty much lost all of it. So I learned not to believe the literature. And I learned to become a lot more sophisticated about understanding businesses and markets, it was my first exposure to investing. And from there, at some point, I ended up going into first, a training program for financial management, and then into management consulting, which was phenomenal school for business, because you get to see lots of lots of companies and lots and lots of management teams across a multitude of sectors, working with varying colleagues for in a highly concentrated amount of time, a lot of variety, a lot of exposure. So I think the my foundation in the end was really about what I learned during those consulting years that I could then transfer to entrepreneurship. 

Nicolas Cary  3:12  

Okay, cool. So one of the things I want to learn a little bit about, so you earned your first bucks, and then you lost your first bucks and a painful lesson, which I think happens to so many young people, you know, they basically think that something sounds like an incredible opportunity. And it turns out, it is too good to be true. Once you started basically bringing a little more rigor and maybe a little suspicion to those types of things. When was the first time you made an investment? And you saw a return on it? And how did you go about sort of making that decision?

Fabio Rosati  3:45  

Well, I started investing in the stock market. And I learned about the principles of value investing. First, I remember that started investing in the 80s. It was not it was not a great time to invest, because the market had corrected. So but at the same time valuations were low, so I really focused on value investing. I mean, at the time I invested primarily in company stocks was the beginning of technology. And then a few years later that the 90s happened in the internet bubble happened. And I saw the impact of animal spirits, as I call them, which is when people start to have irrational expectations about what's possible. You go from all of the rules of value investing basically go into garbage, and you try to understand what animal spirits are going to do to value valuations, only to see that evaporate again, you know, very quickly and that cycle, I guess because I'm old enough to have seen a few of those taught me a lot you should take advantage when you should track great companies and then wait for the right time. had to price to buy them. But as opposed to be impulsive, that you want to study a company for years, I have tracking stocks that attract for 234 years, and attract their price. And when the time is right, I feel like okay, this company, I know it's solid, I know, management Strategy, I understand, and I'm familiar. And I'm gonna go buy their stock now, because it's dropped 40%. Because the Mr. Quarter, something like that, that's that's Strategy served me very well, later, much later in my career started to make investments in early stage businesses. And I've only been doing that since 2016, therefore, relatively new venture investor. And that's a whole other ballgame, we can have a whole discussion about what that's like and what I'm learning. He's still learning. But I think I've kind of nailed a couple of my guiding principles for early stage investing.

Nicolas Cary  5:52  

Now, that's cool. So from the time that you transitioned out of university, and then went to management, consulting, and then kind of began your own entrepreneurial career, talk to us a little bit about how the world in your view, as someone that's really passionate about helping, especially young people find jobs and careers, how's this world changed? You know, in the last decade or two?

Fabio Rosati  6:17  

It's interesting, I, there's two dimensions. One is how it's changing substance than then how changing form, I would say that getting form has changed tremendously, because it is easier than ever to apply for a job. And it's easier than ever to discover a job opening. Well, when when, you know, decades ago, it was much harder, either research, or what jobs are open and what's available. What about the company? What is the job about what about the job description, and how to apply the amount of friction was massive. The so the form is changed in substance, you still have to meet with skills early on in your career, a hard skills get you hired soft skills gets you promoted, that old maxim still applies. And it's extremely important to recognize it very early on in your career, more than ever, your hard skills are what employers are looking for your soft skills are things that you Marine, and will help you advance in your career. If you don't have hard skills that open that door, more than ever before, you're probably going to have a hard time landing a job. And the reason is that companies no longer invest as much as they used to do in developing workers. The days of the I'd mentioned earlier earlier on in our conversation, I went into financial management training program for 18 months, I was trained, because the assumption was I knew absolutely nothing. And it's true. I knew nothing, even though I studied, I had no clue. So you get trained, you learn and you get rotated, you have mentors, I was very lucky that I had that it's very rare nowadays. Nowadays, you're expected to learn on your own. And you're expected to develop certifications and know how on your own. And when people get hired, they come with the assumption that everybody's too busy to stretch to teach them the job, that you better figure it out. That's what's the biggest change that I've seen.

Nicolas Cary  8:25  

Yeah, and I think that discovery can probably feel quite overwhelming for young adults that are beginning searching for career opportunities. I think that is such a wise thing, though, is that the hard skills get you hired and the soft skills get you promoted, but it's really important to tune and cultivate those. Yeah.

Fabio Rosati  8:44  

In fact, when people early, you know, I have four children. And so I'm living this firsthand. But I've been focusing on this area of employment and employability for at least two decades, studying a job description, to understand what the employer is looking for, and then targeting your your narrative and your message to exactly what they're looking for. From a hard skills perspective, it's really important. What exactly is this job interview about the job description will tell you a lot. And in addition to writing the right letter and networking, and try to ping people on LinkedIn and do whatever you have to do to get a job and get their attention, then out of the crowd, being in a position to while you potentially wait to be interviewed, brush up your skills on that technology or that tool, whether it's Google Analytics, if there have been marketing, or some programming technology that you may need to apply for a technical job, whatever that is really, really important, even if you're in an entry level position. Maybe more so. Yep.

Nicolas Cary  9:50  

So one of the reasons I love asking people how they are in their first book is partially an icebreaker but also because almost everybody in the world starts off as an entrepreneur. They mow the lawn they carry the groceries Your grandma made me set up a lemonade stand. And so of course, you can have a very successful career working for somebody else. But actually, working for yourself is a very interesting and very viable pathway for many people out there. And so what I wanted to ask you is someone that's founded and built and scaled a bunch of companies and investors and many more, you know, a lot of early stage entrepreneurs think they need to get a loan, or funding right away to get their business started. But what advice would you give to a young person thinking about their first startup?

Fabio Rosati  10:35  

It's interesting. In the right startup, is that for you, for you, personally, it's a personal choice. My one of my biggest learnings is, choose a business that works for you don't choose a business because it's in bold. First of all, by the time you build anything meaningful, and of scale, chances are the others will have agreed with you that there is an opportunity will have started to build other businesses or similar will have attracted capital potentially. So in some cases, what you've created and started after two to three years may no longer be relevant. So don't focus just on market opportunity. And say, I don't know artificial intelligence is hot, I'm going to launch it go into artificial intelligence, because it could be the in three years something something completely different, is relevant and important. And it technology particular changes so fast. And instead focus on problems that you want to solve things that really matter to you assume that the most important part of entrepreneurship is not the the destination, but the journey. I read a quote once about your job is not to be denied, expect to finish the job, expect to add to a piece of it, your contribution. So do not expect to arrive at the end, when you start a company, you may not make it, but expect to be on the journey move things along for a little while. And when you look back, if you fail, you can say, Well, I tried it was worthwhile. And the journey was really great. I enjoyed the journey. Very personal. I really wish I could give you some more formulaic thing, but I would say go back to who are you? What do you care about? Do you really want to work on this? And then apply some rigor to it. But first and foremost, is this what I want to do with my time because you'll be spending 60 hours a week and more likely 80 to 100 hours a week? On on whatever endeavor you choose? has to be something that the customer side? Yeah,

Nicolas Cary  12:56  

Yeah, I always say that no one will ever care about your idea for your business as much as you do. And so that's why it is so important that it comes from some deep reservoir of passion that you have for us, whatever it is, whether it's cooking, or launching a fashion clothing company, or a management company or a coaching company, you have to care a lot about it, because ultimately, that's going to be your unfair advantage.

Fabio Rosati  13:21  

And the other thing I think I would mention it is you know, we're having this conversation a minute before we started the podcast, understand the the weather changes, like you, you may be sailing in very pristine, calm waters with a beautiful sunset in libraries and the temperature in the 70s right now. But chances are as you as you continue on your journey, you're going to have hurricanes, you're going to have loosened waters, and you're going to have people thrown overboard, I am using analogies like that just to give a sense of what it might be like to be a captain of a ship, an intrapreneur moments were really tested. And the sea legs you need to go through those difficult moments. You you develop those sea legs, only if fundamentally had passion and you're doing things for the right reasons. That wasn't liquid.

Nicolas Cary  14:16  

Another thing we talk a lot about, it's because limited org is sort of this concept of practicing, which is how you get better at doing anything. And you talked about it in the context of rigor or discipline. And I think that's so true. And almost anyone can get better at developing almost any type of skill by going out there and practicing that. And that's why you'll hear oftentimes, many entrepreneurs have struggled in many endeavors before they sort of choir all of the accumulated experience, to have a moment and break through and develop that patience and also the sort of risk taking that's necessary sometimes to persevere through those challenging market conditions. And so, one of the things I wanted to ask you about because you've built some Big, big, big companies that have gone public selling a product or a service is key for any founder or business leader. Those are some of those soft skills. What was a memorable business deal? Or maybe? I don't know, a fundraising that you closed or something that you could share with us today? How did you go about it?

Fabio Rosati  15:21  

You know, there's no doubt I'm going to talk to you about landing FedEx as the first Elance customer. So Elance has developed an enterprise offering. And way back when this was a very early days. And the enterprise offering was that the idea was to help large companies hire managed contractors more effectively. And we, you know, the team, we split the work between who's developing the product who's going to sell it. And as a CEO, I basically had to do a little bit of everything. But my job was primarily at one point, once the product started to come together to sell it. And we didn't have a customer. And I started spending four or five days a week on the road, going trying to sell them thing making presentations with PowerPoints and little demos and wire diagrams, asking our investors to help us set up meetings. And we had wonderful board members with tremendous rolodexes. And so we would get these amazing meetings. And that would show up and everybody was saying, Wow, that's an amazing idea. It's an amazing product, we would love to try it. Who else is using it? And every time I would say, well, you would be the first, ah, you don't want to be the first come back when you have at least three customers. And I basically went through six months of that. And then one day we landed, we landed in Memphis and had a meeting at Head of FedEx, its headquarters, the team and I went through the same thing. At that point, we were sort of PSTD or rejection, everything is gonna go great, because we've gotten really good at everything. But we're going to hear the same stuff. And instead, this guy's a FedEx that well, since using the product. And I said, well, in all truth, you'll be the first. And I held my breath. And they looked at each other and says, that's great. We love being the first. And we all like really Yes, because when we are the first they use the term, you will take us pink with attention, you will give us exactly what we want, you will listen to our input, we will develop a product that meets our needs. And that was like music to my ears. And the reason I mentioned stories, because they fundamentally reshape my thinking it is advice that I give to average printer I work with. When you look at a time and its target market. If there are 1000 potential customers, your job is not to sell to all 1000. Right away, if your product is new, discover which of those customers are early adopters. Don't go sell to a bank. If banks are notoriously the last ones to adopt something, go start with the early adopters. There's a few companies in the Fortune 500, who are like FedEx, they are the first Ges. And at the time was another example. There are some midsize companies that are really good at this, that's less than know your market and be skeptical. Like I got 1000 potential customers, any of the five customers were early adopters to get started.

Nicolas Cary  18:21  

This is such great advice. And something that'll be so important for small business owners and entrepreneurs to learn is that the rejection will happen a lot at first because people won't necessarily have confidence. But if you find the right potential client to talk to, then you're really in the right place. And so that's a fantastic lesson. Thank you for sharing.

Fabio Rosati  18:43  

Anything, if you even if you're if you're opening up a shop, and it's not in your neighborhood, and you're selling flowers, or you're it's a barber shop or anything, just know who is the most likely going to try first? Yes, what you want to find out, then you get the testimonial.

Nicolas Cary  18:57  

And then you use that to shopping and build more credibility and start to sell more. That's fantastic. So you've hired a lot of people in your career, I imagine. And I think this is one of the hardest things to do well is to surround yourself with better people. The to give you great advice and then build your companies. What's your favorite interview question?

Fabio Rosati  19:19  

To actually, the one is, if you were president of United States with pulling Thank you powers for 30 days, only 30 days. And you knew that in those three days, they you had the opportunity to have a lasting impact on our society. What would be the one or two things you would do? And then I just sit there and listen. And I love that question because it gives people an opportunity to express what really matters to them. And it gives me a chance to understand how they think what were their artists, I get to know them outside of the world of work in many ways. That's a that's a one of my favorites. The second favorite question is you no matter how old the person is, this works better with more senior talent, but I think it applies to all talent. I asked, I say you, at this point probably know yourself pretty well. And you recognize that your success depends both on your capabilities, but also your environment. What can you tell me about the kind of environment that allows you to thrive? What do you need? What are you Where will you be successful. And again, I sit back and listen, and and it's really, really interesting to see what people come up with and how they think. And it gives me a lot of insights on whether it would be a good fit, and where their heart is, and the level of passion, all that,

Nicolas Cary  20:47  

Thank you, I might have to borrow those, I love to

Fabio Rosati  20:51  

Have a lot of fun with them. Yeah.

Nicolas Cary  20:52  

And the second one is really interesting, because every company has sort of a different culture. And there are some people that despite how successful they've been, or what credentialing they have, are not going to be a good fit for your culture. And I think exploring and listening to people talk about what they need out of their environment to be successful, will be hugely informative, as young entrepreneurs, build their companies, and understand how to get a team around them that can operate with them, and with the expectations they have for how the team is successful. And

Fabio Rosati  21:24  

So I use the example of plants in greenhouses I say, you go to go to a nursery to buy a plant and the plant looks fantastic, you bring it home, and after three weeks, the plant is dead, and you've done everything you're supposed to. It's just it's the wrong temperature or humidity or light. And we are like that we're humans, we do exactly the same thing we have. We respond to the environment in huge ways. So to understand what's the bright green house for us matters in life, at work, and in our personal life as well.

Nicolas Cary  21:56  

So we've got just a couple of couple more minutes left. But I wanted to ask you probably one of the most important questions, which was, you know, who's the most important mentor in your career? And how has social capital played a role in your career in the businesses that you've led to interesting,

Fabio Rosati  22:14  

It's interesting, I have had several, I can tell you maybe a couple of mentor moments, mentor nuggets that really helped me. But I want to say one thing in general, I valued mentorship a lot less in my youth than I do now. Do when I was younger, I was fairly arrogant, and naive. And I didn't appreciate how valuable mentorship was. And and I had the opportunity, amazing opportunity to get incredible mentorship, and it didn't take full advantage of it. But looking back at what do I regret in life? One of my greatest regrets is that I didn't take advantage of asking people, What do you think? And what would you do in my shoes? And how have you done more, I was just too busy doing my thing. Later in life that's changed. But I had a mentor, a gentleman called Conrad rice in Germany was an amazing boss. And I had just hit he thought I was, you know, I had some leadership talent and put me in charge of something. No, I was much younger than the people that I was managing. And I had no idea how to do it. I felt a lot of resentment, like who is this guy of talent was 20 years younger than us telling us what to do. And I called him and I said, Conrad, I'm really struggling. I don't think I can do this. And he said, Well, do you know you understand highways? Right? Yes, you know that there's one one lane highways, two lane highways, six lane like I was in maybe Los Angeles, left lane highways, Fabio, all you have to do more senior talent is tell them what the destination is. And then give them a 12 lane highway to get there. They need to be able to change lanes and go at their own pace, your job is to make sure that they're not going off the garter rail, they're more or less going in the right direction. But let them figure it out. Those huge feedback for me and a great lesson, which be honest, as a person who hasn't some control, control freak tendencies is very hard to do. But it was essential to surround myself with people that were more talented than me and more capable than me.

Nicolas Cary  24:25  

I think it's it's such a big deal. Because I think I have similar experience where when you're young, you think you can figure it all out on your own. And they're really thoughtful people that have been through these paths before. And it's not that they're telling you what to do. They're just saying they've seen this type of thing in the past and a great mentor will listen, they'll challenge you. They'll help build your confidence, but they'll also hold you accountable. And that's really a big deal. And I think for anyone who's going through the crucible of entrepreneurship You kind of need to start with those hard skills, become a good individual contributor, then you become a good cultivator of other people's talents, and get them to become the best versions of themselves. And then finally, leadership is something a little bit different that's setting that vision, and putting your own signature on how you coordinate all of that together. And successful business owners basically work in many ways through all three of those stages in order to build products and services that people find useful. So, Fabio, thank you so much for your time today. I'm really grateful for it. You know, for those that don't know, Fabio serves as a board member at skysthelimit.org, where we connect underrepresented entrepreneurs with volunteer business professionals for free one on one mentoring. Everyone out there does not need to struggle alone, it's so important to find people that you can talk to about your ideas and build your business plan with feedback. So without further ado, we also provide business guides to all our mentors plus monthly funding opportunities, you can sign up for free today. And if you liked what you heard, please subscribe, and share.

Outro  26:03  

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