Anthony Halsch: How to Scale Culture Quickly

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Probably the hardest time that I’ve had as an entrepreneur was when I made a bunch of money, had a big windfall and decided to scale my team quickly. I then realized that I couldn’t sustain it because I didn’t have consistent revenue. My eyes were open that is a constant battle to stay in balance with cash, products and having enough of the right people.

Our guest in this episode is no stranger to this either, as he is in the throes of scaling. Anthony Halsch is the CEO and Founder of ROXBOX. It’s an innovative manufacturing and construction company. They give a second cooler life to shipping containers. They repurpose them into unexpected things like the beer can, which is a portable bar for festivals or into office space or retail space. You got to go to their website, which is ROXBOXContainers.com and check out what they’re doing.

In this episode, we’re not going to talk so much about that. We’re going to talk about how they went from 7 employees to 25 and maybe even more in about 2 months. It’s a little scary for me to remember my experience. It’s terrifying and also an incredibly exciting place to be but no easy feat. It comes with tons of stress, including how to manage all those new people, what’s the structure of the organization, how we keep products rolling and keep people there and make sure everybody knows what they need to do. Most importantly, how to turn the corner as a CEO and not throw yourself into so much work that you burn out. Anthony Halsch, welcome to the show. Tell us, how are you?

I’m doing good. We’ve had a good 2022. It’s been a lot of rapid growth. We expanded from 5,000 square foot facility to a 35,000-square-foot facility in about 6 months. I went from 7 to 25 in about 1.5 months to 3 months, depending on when you start the clock type of thing but it’s great, not with its challenges but it’s a good time.

What have been some of the most surprising things for you about scaling this team?

When you bring in a lot of different people that don’t know each other into an organization, you’re going to have people feeling each other out and the job in and of itself, all while you have tribal knowledge from the people that have helped start the business. You bring in a lot of new people that have, hopefully, more experience than where you’ve seen in the past and continue to contribute to the overall goals of the company. With that, the difficulty comes in making sure all those people mesh with the goals of the company and, ultimately, the culture.

The experience of doing all that was eye-opening, to say the least. Running a team of fewer than 10 people is not easy but it’s a lot different than when you get over the 12-15 people. As your role as the CEO changes from pretty much, every single person that’s in the company is a direct report to then having the steps of management or the CEO down to a manager level and then to some more people less senior than that.

You’ve got another layer of management in between yourself and people getting it done. That’s where that challenge is making sure your managers are also evoking the culture and the moral compass that you’re trying to create within the company, all while pushing to get more stuff out the door. It’s a lot of things that are combined there.

When you were smaller, in that 7 to 10-person culture, what did you have in place to help define the culture? Did you have anything you had already done as a team?

It’s not planned out. It was me and two other people when we started the company. I founded it but they were quick supporters coming right onto the team and things like that. They helped us grow quite a bit.

Did you have more purposeful things you were doing to sustain your culture?

Honestly, not. We’re a group of people that’s creative. We like to have fun and we work our asses off, to be honest. It’s one of those things where it was a natural culture. A lot of the people that I hire have similar personalities to myself and similar drives in terms of work ethic and what they’re trying to achieve in their life. A lot of them are younger people. I’m a fairly young person myself. A lot of the time, I had people that were a couple of years older than me.

Maybe 1 or 2 that were younger than me. It wasn’t a structure so much as you show up and do the best you can. We’re going to have fun at the end of the day too. A lot of companies say the work-life balance, work hard play hard type of thing but we did that. It was going out to events, festivals and things like that. What’s cool about our product is that we got invited to a lot of those things and a lot of times complimentary tickets and stuff so we can get our products in there and let our clients use them.

By doing that, we would have the whole team out there on a Saturday or Sunday at whatever it was, a beer festival, a farmer’s market or something like that. We were able to enjoy each other outside of work as well and celebrate the fruits of our labor a little bit by seeing it in action. Our clients were very happy and the customers using those products were very happy. It’s a perpetual circle of that type of enjoyment that you show up to work on Monday, get stuff done during the week and go have fun on the weekends. It’s all work-related but it doesn’t feel like work at that time.

What are you noticing around the structure that you’ve maybe needed to put into place to support those 25 people that you didn’t plan for or didn’t have when you were 7 to 10?

That’s a big challenge. Honestly, that’s where culture slips a little bit too. As you’re hiring all these people, you have to put in controls and management structures so that everyone knows what they’re doing and can continue to forward the mission without having to ask questions or know where their places and all that stuff. It’s an ever-evolving situation. We slowly scaled up to around twelve and then doubled our personnel in about a month after that. That was in April or May of 2021 when we did this.

It was a challenge because we, unfortunately, had a turnover. When you’re hiring that fast, some people aren’t going to be a fit. One of the things that we try to do is do a 60-day trial period, essentially. We don’t give benefits or anything like pay time off until after 60 days. There’s a period where we get to know each other, start learning from each other and see what skills are if it’s a match or not. What we were doing was trying a lot of people out. It was a pretty quick situation that if they didn’t fit in, we were like, “Thanks for your time here but it’s not going to not going to work out.”

That’s a difficult part too. As a CEO, you’re hopeful that everyone that you hire is going to be a ten-year employee and add a lot of value to your company. That’s why you hired them in the first place but the reality of the situation is that’s not the case anymore. People are looking for other options and maybe trying out jobs that they’ve never tried before. Our company is unique to what we build. It’s not repetitive so much. We do a lot of different things, so you have to be very flexible. Even flexibility within a company can make people uneasy or uncomfortable. You have to have people that are willing to learn on the fly and change on the fly.

Those types of people are, I’ve come to find out, a little few and far between. A lot of people do structure more. Around here, things can change in a couple of minutes, it seems. That’s a big part of that. The turnover hurts but at the same time, you have to understand that it’s part of that growth. If you want to scale and you’re having to hire that many people, unfortunately, the diligence piece is something that, honestly, and I hate saying this, we didn’t have a ton of time for.

If we had a phone interview and an in-person interview and we liked them, we’re like, “Let’s try this out.” It wasn’t a 3 or 4-interview process. With that, we’ve always maintained a fun culture because of what we do. The people that ultimately ended up staying with us and got through that 60-day trial period fit in great. It’s that evolution of the culture that keeps on going and evolving as you grow.

We work with a lot of companies on this too. You can do a faster-recruiting process or put them through a faster experience if you have a process associated with it. We have a very fast process too. This is the work we do. We better eat our dog food but it can work. If you put more structure around it, you have more success too. It’s thought there. Let’s talk about your management structure. I have always been a student of this work. I’m curious about how people structure their organizations.

I’ve studied pretty in-depth like the Zappos model, which is very flat and a large organization for how flat they are. Your command and control type of organization is extremely hierarchical. I find the best balance is a combination of both where you’re enabling people to make a lot of decisions on their own but they’re still managed and still have somebody help knock down barriers. Where do you find you folks are falling in those two extremes of the no-structure whatsoever to too much structure?

We’re a hybrid model as well. We tried to employ the flatter model earlier on when we were in July-August of 2021. We had more managers across the board so that they were handling individual parts of the company and they were responsible for it. It would flow up to me a little bit but we only had 3 levels with 25 people with the C-level at the top. We’ve got me as the CEO, Chief of Design and Chief Growth Officer and then our Director of Operations. That’s the four managing partners of the company.

Below that, we’ve got production people, finance and project to estimation and marketing. We have people below them. It’s only a three-tier company and still fairly flat. I’m still out there managing projects and getting stuff done when we need it and getting my hands dirty and that stuff. When it comes down to it, everyone will pick up a wrench, a screwdriver or anything like that to get stuff done. When it comes to time to do something, it’s all a hands-on deck. We call them ROXBOXters. We work 24-hour shifts straight through and get a project out the door. We have tight deadlines. Some of our clients are trade shows or something and you can’t miss it.

We have to work that hard for that long. It’s everybody on the team. The office and the production team are out there, getting stuff done and doing whatever they can to help. It fluctuates for sure at certain different times of sales and where you’re at with your yearly sales cycle for how flat or structured it gets. We’re fairly fluid in that regard.

Scale Culture Quickly: Running a team of less than 10 people is not easy, but it’s a lot different than when you get over the 12, 15 people as your role as the CEO changes from pretty much every single person that’s in the company is a direct report to then having the steps of management.

With your management team and the layer that’s between you and the people who are doing a lot of the work, how do you feel your communication is with them? What are you doing to communicate values and expectations through those managers so that the culture is sustained at that lower level even?

We don’t have a ton of structured team-building types of things but what we try to do is have all-hands meetings every month that they go through. We’re a very transparent organization. We go through where we’re at cashflow-wise, product-wise and customer-wise and then shine a light on what’s coming down the pipeline. A lot of people on the lower levels don’t get to see everything that we’re doing in the office, all the clients that are coming in and the conversations that are being had.

If we get a little slow in the shop for 1 week or 2 on how our sales cycle goes, some of them might get a little antsy like, “Where’s the work and all this other stuff?” We’re over here freaking out because we have way too much coming in and all that. It’s hard to delineate or communicate all that stuff to everyone in the company. We try to have group meetings as much as possible. We do all managers meeting every Tuesday.

We go through a lot of this stuff at a higher level so that they’re able to disseminate that down to their reports and be able to see that. We also hang out after work and stuff like that. There’s a group of us that hang around and talk. The overall goals are organic in terms of how they’re communicated. We also have SOPs, missions and values that we have hanging up, so people are aware of where we’re going and what the ultimate mission is. A lot of that stuff gets hammered down in the all-hands meetings that we do all the time.

How do you feel as a leader? How has it been for you? Do you like it?

It’s good. I don’t see myself doing very many other things than starting businesses and running them. I have another company on the side. We do spray foam insulation as well. My wife runs that. I enjoy running businesses, selling and putting products out there. If you do it right, it’s an improvement for the world. I like all that. I would get bored if I didn’t have something to do every day.

What are some of the things that I call head trash, like the stuff that causes you to go, “Am I doing enough? Should I do more?” It’s the stuff that feels like the itchy shirt that you need to take care of but it’s hard to figure out what to do. Do you mind sharing what yours might be?

There are a lot of those. The biggest thing is developing an action plan around where your mission is and what your vision is. One of the things that people can get caught up in is the big, hairy, audacious goals. You look at those and try to take big bites out of them. You end up not getting anywhere. It’s a better approach to develop a system around how you’re going to get there by either daily tasks of little bites here and there of how you can keep moving towards that goal every day instead of trying to have an all-day meeting or something like that to have the managers in there. We solved a big problem that day.

What we’ve tried to do is break it down a little bit further. We’re doing this, so this is a good conversation to have. We’re realigning roles and responsibilities. We’ve grown super fast. We’ve moved some people around to higher-level management positions. We’ve let some people go and some people leave. We’ve been realigning with the team that we have on getting back to how we’re operating and what they’re doing. With all of that, we use a system OKR. Its Objectives and Key Results. If you read any Silicon Valley startup books, any of those types of things, that’s what they’ve always used.

All the big companies have always used OKR. The type of mentality that we try to take is taking those big goals and breaking them down into a yearly goal and a quarterly goal. What are you doing every day to get there so that on month 1, you’re at a certain place and on month 2, you’re at a certain place? As we’re realigning our OKR and our personnel and stuff to make sure everyone’s in the right seat on the bus, that’s developing how we’re able to get through that itchy shirt.

Some of the stuff that I’m looking at is, is everyone working a full 40? Are there people that have fewer hours? We can potentially put some more work onto them and take some from the people that are working 70 hours a week. In modular construction, it’s tough because you go through these peaks and valleys where you’ve got a bunch of work that comes in and then there’s a bunch of work that has to be done on the front side that’s in the office to get through permitting and all that stuff.

You go through this wave situation where you’ve got a lot of work and then it slows down. We’re trying to take that out of play by changing some of the sales things that we do. That’s probably one of the biggest itchy shirts that I have. Make sure everyone is putting in all the time and not too much. We’re not trying to burn people out by working 70 hours or 80 hours a week. You can only do that for so long.

That’s a big one and then consistency and manufacturing. Take out those waves so that we have longer-term projects that continue to go. It’s not so much work on the office side because we continue to produce the same unit over and over again. It doesn’t take more of the office time, so that keeps the revenue going. I would say those two things. The efficiency of making sure everyone’s in the right seat and realigning everyone to make sure they’re working enough and not too much, also getting rid of the ebbs and flows of the projects.

That’s challenging for sure. You can also get to a point where you’re selling so much that it’s a consistent 70-hour work week. If it’s not ebbing and flowing, then you’re on a path to total burnout because there is only so much that someone can sustain for a long time in terms of stress without having some downtime. With that in mind, how are you? What are you doing for yourself?

I like to go camping on weekends off. I’ve got two little boys. Spending time with them and my wife is what we do to relax. We go to the woods and somewhere in the mountains where the cellphone doesn’t reach the towers and shut it off for the weekend. That helps out a lot. We take off the week between Christmas and New Year’s every year as well as the week of the 4th of July. We try to split the year in half at least and give people a week off where no one’s working, so we don’t have people calling. If we’re in production, my phone’s pretty much got to be on all the time in case we run into whatever.

That’s where it’s a challenge. It wears on you for sure but I wouldn’t change it for the world. I’ll take it because we’ve bootstrapped this company. It’s pretty much everything. My whole existence is in this building and company. It is everything. We’ll continue to push on that and see if we can take some breaks here and there. We do have an unlimited PTO policy. Our team is very good at preparing for a leave of absence.

In Colorado, there’s a ton of stuff to do outside and all that. A lot of our team likes to go enjoy the mountains and the outdoors of Colorado and the West in general. We try to let them do it. I don’t think I’ve ever said no to a vacation request. Get everything prepared, put it in a big email of all the things that could happen or what you might have to be responsible for to make sure all the people that are covering for you know who to talk to and have the contacts. Go shut your phone off and enjoy yourself.

One of the pitfalls we see of unlimited PTO is that people don’t take it. There are a couple of things that either happen. You have the occasional person who takes advantage of it, which is a different issue or you have people who don’t do it at all and then they burn out. It’s a good thing that you’re seeing people taking it. That’s a very positive thing.

It’s probably from the way you put the structure together and you were also modeling it. You’re stepping away, which is good. It’s something to keep in mind down the road. If you see someone not taking any of their PTO, you got to give them a little kick in the pants like, “You need to go on vacation.” What’s next for you? What do the next years look like?

We do have a lot of initiatives in play and there is a very large contract manufacturing. It’s multiple units over and over again. It’ll be hopefully, about a 2-year project of 4 to 8 units a week type of thing. That’s the one we’ve been looking for to take out those ebbs and flows. That’s coming up in Q1 of 2022.

Congratulations.

Thank you. A lot of the bigger ones that we’ve been working on for a year or more are starting to come through finally. There are a few larger developments that are going to be taking place in Denver, which is super exciting. We haven’t built big things in Denver so much yet. They’ve been in other places and stuff. It’s great to see that we have some clients here where we’re going to be putting in some pretty cool installations that will be very active in populous over the next couple of years because they’re in high-traffic areas and stuff. Bringing the stuff to the hometown is awesome.

Scale Culture Quickly: Two things – efficiency of making sure everyone’s in the right seat and realigning everyone to make sure they’re working enough and not too much, and then getting rid of the ebbs and flows of the projects.

We’re also looking at a potential expansion to the East Coast somewhere. We’ve got the West pretty much covered but we are losing some deals or getting into competitive deals on the East Coast due to the transportation factor of how expensive diesel fuel is and the cost of all getting everything to the other side of the country. To buy from ROXBOX, you could be adding a $5,000 to $30,000 shipping bill if you’re on the East Coast. That puts us out of some competition in certain areas, depending on what the build is. That’s a big one we’re doing.

Dive in a little bit deeper into the company itself, develop more training and get prepared for the next big expansion. We’ve sat at 25 employees for about close to a year. We’ve been at this level and that’s on purpose. We want to get our feet underneath us a little bit more. With a bootstrapped company, you can’t make a lot of mistakes because if you do, you run out of money and then start over.

I don’t even have a loan from the bank or line of credit. I’m like, “I’m 100% bootstrapped as well,” so I get it.

That is an eye-opening thing too if you do get slow, the cash does get a little low and you have to start laying people off and things like that. It’s not the funniest day to be the CEO. You don’t want to go on that day. Being cautiously optimistic is the role we’re playing. It’s like, “Things are going well. We’re growing.” We’re going to try to keep us as lean as possible and have people dive deeper into their roles and process out more of the operations so that so it’s more automated.

We don’t have to add more people to the situation so that our communication can get significantly better throughout the ranks. Once we have that foundation developed a little bit better, people know exactly what they’re responsible for and what they’re supposed to be doing all the time, then we can potentially hit another growth mode here even higher and potentially add more people as we expand potentially to the East Coast, so that’s the next.

It’s so good to chat with you. We wish you the best in this journey for sure. I appreciate the thoughtful approach that you’re taking to this and your culture as well. Thank you so much for sharing your story with us.

Thank you very much. I appreciate it.

Anthony Halsch with ROXBOXContainers.com. Go visit him. Check out what they’re doing. It’s probably not something you’ll have in your backyard but it’s something you may see at your local festival. No doubt. Thanks so much.

Important Links

• ROXBOXContainers.com

About Anthony Halsch

Anthony Halsch is the Founder and CEO of ROXBOX Containers, a Denver based manufacturer of modular buildings. ROXBOX builds retail, food and beverage, commercial, and industrial structures out of shipping containers and steel modular buildings for clients like Coca Cola, Walmart, Adidas, Left Hand Brewing, Nokian Tyres, and Winter Park Resorts to name a few. While founding and running multiple companies, he has also sat on Boards of Directors for nonprofits and local organizations to help them grow and achieve their goals. ROXBOX has received many accolades including; 2-time Runner-up Manufacturer of the Year from Colorado Manufacturing Awards, Inno on Fire Award Winner, Colorado Companies to Watch, Top 21 Startups to Watch in ‘21, and Denver Business Journals Small Business Awards Recipient again this year. Anthony was also just named Top 25 Gen XYZ Business Professionals in 2022.