The January Cutoff: Rebuilding a Services Firm Around Human + AI with Kyle Walbrun | Episode 260

Episode Summary

Most founders are bolting AI onto the firm they already have. Kyle Walbrun rebuilt the firm. In this episode, the founder of EfficientAide walks through the decision to stop slow-rolling the AI transition and rip the band-aid off. Starting in January, every new client went on a rebuilt human + AI delivery model. Legacy clients get moved over one 1:1 conversation at a time. The team, the recruiting criteria, the compensation plan, and the pricing were all reworked to match. This is what a full-stack pivot looks like from inside month four.

About the Guest

Key Takeaways

• Why adding AI to the old delivery model fails, and what a rebuilt human + AI pair actually looks like
• How to execute a hard cutoff on new business while transitioning legacy clients without losing the firm
• What changes in recruiting and compensation when AI proficiency becomes the hiring criterion, not EA experience

Full Transcript

Greg Alexander: Hey everybody, this is Greg Alexander. You’re listening to the ProServe Podcast, brought to you by Collective 54. If you’re new to this show, this show is dedicated to founders of professional services businesses. So if you’re in the expertise business, if you market, sell, and deliver expertise for a living, this is for you. We aim to help you do 3 things. That is, make more money, make scaling easier, and make an exit achievable. And on today’s show, we’re gonna talk to a Collective 54 member, who we have classified as an Era 2 member. What that means is a tech-enabled business. Somebody who has a long history of providing technology tools to humans in service of clients, and therefore make their humans much more productive. But this individual has ripped the band-aid off, so to speak, and has made the transition to becoming an AI-native firm, or in Collective 54 language, that means an Era 3 firm. Which is not bolting AI onto existing processes, rather, it’s hitting the reset button and redesigning the business from the ground up to be AI native. That took a lot of courage. And it’s a work in process, but many of you are wondering right now, should I just bolt on AI to what I’m doing right now, or should I start over? So that’s what we’re going to talk about today. So, Kyle, it’s great to see you, man. I appreciate you being on the show again. Just for those that might not know you, would you please provide a proper intro?

Kyle Walbrun: Yeah, absolutely. Thanks, Greg, good to see ya, and happy to be here. A little bit of introduction, so I’m the founder and visionary at EfficientAide, and at the highest sense, we’re in the business of working with high-caliber leaders who want their time and focus back. Ultimately, we solve that by providing executive assistant support. And this topic will resonate — I almost don’t even like using the word assistant, because it’s so much beyond a quote-unquote assistant, but truly working with a fractional virtual model to provide a service of buying back time and getting leaders focused on truly what they should be focused on.

Greg Alexander: Okay. All right, so as I mentioned in my tee-up, so to speak, is that I think it was in January. You and your co-founder made a very bold decision to kind of rip the band-aid off and get to an AI-native business. At its core. So, tell everybody what rip the band-aid off meant in your world.

Kyle Walbrun: Yeah, great question. And this was leading up — so January was the kind of our formal cutoff of, hey, we’re going forward, but there was a lot of due diligence and work in advance, and I can candidly thank Collective 54 for that nudge and for providing a lot of those resources. There’s never a great time to all of a sudden decide, hey, we’re no longer doing what we previously were doing, and we’re now gonna completely shift to a new model, which meant not only new clients going in that new model, but also moving all of our legacy clients over. And so, for us, and for my integrator, we had to make kind of a firm date, or we would have just kept kicking the can down the road. There’s no ideal way to proactively say, hey, I might not have the right team anymore, and I may need to opt some people out, and I may lose some clients that are happy that aren’t a fit for this new solution. So, in the macro sense, we had to pick a day, because if we didn’t, it would not have happened. And we also did a lot of prep leading up to it to feel confident that it was good timing. New year, fresh quarter — that date also aligned for us in our minds as well, to just make the jump.

Greg Alexander: So let’s talk about the jump. So what did you actually do?

Kyle Walbrun: Yeah. We are in the executive assistant space, so like any industry, AI has been — I wouldn’t even view it as much of a threat, more of an opportunity, but traditionally, in our space, it’s a very task-heavy, manual industry. Well, call a spade a spade, people don’t want to pay for that anymore. AI can automate repeatable tasks. We also realized — old model, human labor focus, task focus. Here’s a list of tasks, here’s a human, and that human is going to complete those tasks. Well, that was the old model, and that worked for the longest time. But now, not only does it make sense internally due to margin and scale, our clients now, they want to delegate outcomes, they don’t want to delegate tasks. And so we had to reframe how we do proposals, how we work with clients to be less focused on day-to-day tasks. They’re still important, right? Leaders still don’t want to manage their inbox, but they don’t want to pay the rate that we were charging for that to be the core focus of our support. And we had to evolve to more strategic partnership, accountability partnership, creating leadership leverage, rather than, hey, I’m just going to book your appointments and schedule your calendar. So, in short, the biggest switch was exchanging humans doing manual labor and tasks to now, our humans are solely focused on having a human in the loop for AI for QC, but more importantly, being there for strategy, proactive anticipation, and truly being a gatekeeper for our clients.

Greg Alexander: Okay, so give me an example of a task that used to be done by a human that’s now done by AI with a human in the loop for QC.

Kyle Walbrun: Yeah, I’ll give a few that are very standard for us. Inbox management. Calendar management, scheduling. Even just things such as online research and travel booking — very straightforward tasks. Well, let’s talk inbox management. It’s a hot topic — every client we worked with, most leaders want that. AI is really good now at very efficiently reading, summarizing, prioritizing emails, but the part that they miss is context, political nuance, also being able to understand truly priority levels in a given day or in a given week. So, in an old model, 80% of their attention was spent on manually reading, filing, sorting emails. Now, in a new model, 20% of their time is maybe just QCing and having a human in the loop on AI. They have the human and strategic component to it — that’s a really great example of how we’re operating.

Greg Alexander: When you say the strategic level, I’m struggling with that, because I think about inbox management, and I’m not educated enough to know what the strategic side of that is, so what do you mean?

Kyle Walbrun: Here’s a great example. In the macro level, what we’re trying to achieve: things only land on your desk, aka on your radar, if it truly requires your unique input.

Greg Alexander: Okay, I got it.

Kyle Walbrun: So inbox management will say, hey, you need to do something with this. Someone’s asking you a question. The human can determine, does my client, does that founder actually need to do something with that? Or can I move it forward or queue in someone else where it doesn’t even land on their desk? That would be a more strategic component.

Greg Alexander: Okay, so a judgment call needed to be made there that the AI could not make, the human had to make the judgment call. Okay, so that makes perfect sense. Alright, so when you made the switch from the old way to the new way, you’ve got this pesky thing in the middle called clients — legacy clients that are used to the old way, and now you’re going to the new way. How did you handle the migration?

Kyle Walbrun: A lot of time, a lot of energy — I’m not gonna beat around the bush. The technology aspect of this new model and this pivot is, quite frankly, the easiest part of it. It is the human component, the relationship component. It’s very difficult to go to a client that’s been with us 3, 4, 5 years. They’re happy. There’s no problems, and for us to say, I know you’re happy, I know you’ve been with us forever, but hey, we’re switching. This is how we’re now going to operate. And that may result in some change they’re not comfortable with. So what it really boiled down to was a lot of prep work. I wanted to be overly prepared in having these convos with clients around the why — why this was going to benefit them. And one thing that was important, at least in our transition, is all of these conversations with every client happened one-on-one with either myself or my integrator and COO. That was very important for us. One-on-one intentional conversation, so — prep, one-on-one conversations explaining the why, and then tailor-making a solution according to those combos that they felt comfortable with.

Greg Alexander: What do you say to a busy founder who says, I don’t have the time to go have all these one-on-one conversations to convert everybody to the new way?

Kyle Walbrun: Yeah. For me, I found truly there was nothing that was more important that I should be doing. That conversation lands much differently with a legacy client if the founder, owner of the company is making one-on-one time, and it’s not coming from a middle manager or from their EA. So I personally took the approach that that was the most important and effective use of our time, because at the end of the day, we lost clients as a result of this. I won’t beat around that, but we also retained a lot more that I know were a result of having a leader-to-leader conversation. That perspective is much different, because I can relate to what they were going through, and I could relate to how it could benefit them, because we’re drinking the Kool-Aid internally.

Greg Alexander: You mentioned you lost some clients, and it took a lot of guts to say, I’m willing to lose some clients. Because if I don’t get to the new way, I probably lose all the clients eventually. How did you muster up the courage to walk away from the revenue?

Kyle Walbrun: Two big things. One, it was really important being a part of the Collective 54 community, because I was able to surround myself with other folks that have been making this switch, and experience shares were huge. The easiest way I could define it in my head was, I knew we had to slow down to speed up. And that’s how I would describe it. I knew we’re gonna lose some clients, we’re gonna lose some momentum, we may not be able to even bring on as many new clients right now while we’re shifting things, because I didn’t want someone coming in into a limbo model. I wanted to be all in or all out, and I knew just looking at industry trends, looking at the nature of the pro-serve industry — it wasn’t a matter of doing it or not. I knew we had to evolve or die, and that was just a very clear point in my head.

Greg Alexander: You know, I share your pain, because as Collective 54 has changed, we deliberately asked some members to politely leave. But the bottom line was, it was some legacy clients that just weren’t going to be right for us, and we weren’t going to be right for them going forward. He just had the courage to make that happen. You know, that requires sometimes some pain internally, some right-sizing. So I know you went through some turnover, some employee turnover to make this happen. Walk us through that.

Kyle Walbrun: Yeah. That was a really tough component of all this. I mean, anybody that’s in the people business, losing people is tough. The approach I took right from the get-go was there are going to be clients and staff that are hopefully going to self-opt-out. And you’re right, that makes things much easier than proactively churning. But the internal side was very different, and being the harshest critic for me as a leader, I had to have a very vulnerable convo with my staff to say, I know this is how I brought you on, and why I hired you, and why you were a fit. Here’s where we’re going. AI is not optional, it’s mandatory. If you want to lean in, we’ll lean in with you, but if you’re gonna lean back, hey, it’s okay, there’s no hard feelings. Those are tough convos to have, to have staff that have been with me 4, 5, 6, 7 years, and to determine, hey, I’m not gonna be on this boat anymore. Turning staff is always very difficult, and again, it goes back to that mindset — slowing down to speed up.

Greg Alexander: So let’s talk about that. So, you were on our podcast almost about a year ago, and at that time I asked you what makes for great executive assistant, because that’s what you were bringing to the marketplace. Obviously, that has changed dramatically, and I’m assuming you’re now hiring for AI proficiency more so than being an executive assistant. How has the hiring profile changed?

Kyle Walbrun: Yeah, you’re 100% correct, and it’s pretty crazy how quickly things can change. Before we were looking for legacy admins that have been doing this forever, they were used to pushing the papers, and they were great. That worked well. But that is not at all the criteria we’re looking for now. Granted, it’s great to have some folks that have previous support-type experience, but I’m looking for AI-enabled operators, people that can move fast-paced, that have high EQ. It’s something that wasn’t as important before, because this is typically a behind-the-scenes role. You get a list of tasks, you log your hours, you complete them. Now our value is folks that have high EQ, can be on a call, make our clients feel confident, make them feel warm and fuzzy, and being able to communicate with stakeholders. So now, it’s for folks that have AI experience, first and foremost, and we always, when we hire, would do case studies. Before the case study, before you’d hire, is, hey, take the call notes, I want you to organize and send me a recap email — I can see how they organize information. Now, it’s, hey, we’re gonna give some mock examples of tasks, and I want you to walk through how you’d approach that task. And if the first thing they’re not saying is leveraging some sort of AI to help develop a plan, I know right then they will not be a fit in this new model.

Greg Alexander: Yeah. It’s a fascinating thing to think about. I have many of our members who are reluctant to do what you did, meaning they’re hoping that their loyal, long-time employees will eventually close the skills gap. You were willing to rip the band-aid off. As I understand it, you basically got all this done in one week. Tell us what you actually did.

Kyle Walbrun: Yeah. At the end of the day, we had a State of the Company meeting, and it was, here’s the old vision, here’s the new vision, here’s what’s changing, here are the non-negotiables of what we’re requiring now as part of this vision, and I had that candid conversation. If you’re willing to lean in, we will lean in with you. I didn’t expect everyone on the current team to come in savvy with it, but if they were willing to lean in, we’d provide resources for them, because A players were now, all of a sudden, in the matter of a week, our C players. And we all know we cannot continue to get pulled into C players, because the A players will suffer from that. So it was first a firm line in the sand about the why, this is why we’re doing it, this is what we’re gonna do, and this is gonna be the outcome. And for those that want to be a part of that — almost instantly after that meeting, I was getting Slack messages of either excitement, or, hey, we should probably have a one-on-one and discuss. And that was my most effective way, and being very definitive — this was not negotiable. I wasn’t coming in as a dictator, but I said, I want to continually provide a place where you love what you’re doing, and you’re showing up, and you have a career. Well, if we continue doing what we’re doing, we’re having a much different conversation a few years from now.

Greg Alexander: I would imagine that if I’m your client and I’m embracing your new service package — which is an elevated human supported by incredible productivity-enhancing AI tools — that I’m getting better service. I’m getting faster results. I’m probably either being charged less, or I’m getting a lot more for the dollar that I spend. Better, faster, cheaper, smarter. Did the value go up for the client?

Kyle Walbrun: You’re exactly correct. We’re able to actually either reduce costs or keep clients at the same exact rate they’re on, but now we’ve just added a whole mountain of additional value. And we’re able to internally, as a business, do it more effectively from not only an operations standpoint, from a cost standpoint as well.

Greg Alexander: So, therefore, the people that stayed with you are probably able to serve more clients. And if that’s true, they probably can make more money, because if it costs you $100,000 for an executive assistant who can only serve 5 clients, but now for $100,000 I can serve 20 clients — the economics of your firm changed dramatically, and you probably can share some of that. So even though you have fewer people, they’re probably better people and better compensated, is that correct?

Kyle Walbrun: It’s exactly correct. It wasn’t one-to-one. It wasn’t like we had four people opt out and we had to replace with 4 people. Oftentimes we may have four people leave, and we either need to replace one, or we don’t have to replace them at all, because the people that are leaning in are extremely efficient in using AI. So, from a business standpoint, again, it is still a slowdown to speed up, because we lost clients, and we’re losing some top line, but in the long term, the bottom line will far outlay the miss on some of the top line.

Greg Alexander: In services, we optimize for profit, not revenue. So even if you’re a smaller firm from a top-line standpoint, if you’re more profitable, that’s a value creation strategy, not a value destruction strategy. I have one more question for you, Kyle, and then we’ll let you go. When people go from Era 2 tech-enabled to Era 3 AI-native, they’re seeing an increase in demand, because there might be a whole segment of the market that never hired an executive assistant because it was out of reach from a cost standpoint. But now the price point is lower. So a whole new segment of the market is opening up. Is that happening with you?

Kyle Walbrun: Yeah, demand is starting to go up dramatically, because we’re at a more affordable price point, or staying at a price point, but adding a tremendous amount of more value. The other part of it is, in previous, some folks would come to me and say, Kyle, it looks great, but I don’t need someone to check my email or schedule my appointment. Well, that used to be a big main focus. Now that’s some of the smallest — it’s still important, but some of the smallest amount of where our energy goes. Now clients have opened up and said, I want someone to manage me. I want someone to create leadership leverage, and be a multiplier, and be a gatekeeper. That has opened up a whole new client base that puts a lot more value on that, rather than day-to-day task execution.

Greg Alexander: Yes. So, for members that are listening to this, who have dreamt about having a high-powered executive assistant, but never pulled the trigger because cost was in the way, give Kyle a call, because cost is no longer in the way. So, Kyle, on behalf of the community, I appreciate you being willing to come on the show, be vulnerable, do an experience share. We learned a lot from you. Congratulations on having the guts to go for it, and I wish you the best of luck as you try to become an AI firm.

Kyle Walbrun: Appreciate it, Greg. Thanks for having me on.

Greg Alexander: All right. To those that are listening, couple calls to action. If you’re not a member, and after listening to this you want to become one, go to Collective54.com, fill out an application, we’ll get in contact with you. If you are a member, and you want to hear more from Kyle, attend the private member Q&A, and you can ask your questions directly to Kyle, and learn more about the story. But until next time, I’m greatly appreciative of you working me into your busy day and giving me a piece of your attention. I hope you found this session helpful, and I wish you the best of luck as you try to grow, scale, and someday exit your firm.