Pod Insights Marketing School - Digital Marketing and Online Marketing Tips How To Dissolve Partnerships The Right Way, It Used To Pay To Switch Jobs, Now It Doesn't About this episode In episode #2942, Eric Siu and Neil Patel unpack the challenges of business partnerships, reflecting on past successes and failures. They emphasize communication, intensity, and handling tough conversations, while also exploring job changes, career growth, and managing stress in work and life. TIME-STAMPED SHOW NOTES (00:00) Navigating Business Partnerships (03:01) Lessons from Failed Partnerships (05:54) Dissolving Partnerships Amicably (09:01) The Importance of Intensity in Partnerships (12:04) Job Switching vs. Career Growth (15:02) Understanding Stress in Business and Personal Life Prefer single topic episodes? Head over to our YouTube channel. To suggest a topic, go to https://www.marketingschool.io. For more content from Eric and Neil, check out Eric’s Leveling Up with Eric Siu YouTube channel and Neil’s Neil Patel YouTube channel. Connect with Us: Single Grain << Eric's ad agency NP Digital << Neil’s ad agency X @neilpatel, @ericosiu Instagram @neilpatel, @ericosiu Drop Us a Review If You Enjoyed the Episode!
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0:34 Speaker 01 I've had some bad partnerships and good partnerships. One of the longest partnerships I had was with my brother-in-law, Heath and Shaw. And we dissolved it in a really good way. We still talk. I just talked to him this morning. I'll give you an example of a bad business partnership.
0:51 Speaker 00 Wait, wait, wait. With Heath and real quick, are you free? I mean, I feel like you were very just generous and hey, let's be done with it type of thing. And I think a lot of it came from you. I don't know his side of the story, but I know you were very generous.
1:04 Speaker 01 So when I ended my partnership with him with assets, like we had Quicksprout and I first created the blog. Then we built into app.
1:13 Speaker 00 Just so everyone knows, Quicksprout was Neil's blog before neilpatel.com and it got a lot of traffic.
1:17 Speaker 01 Uh huh. And then we were generating revenue. I know we got it up to over a hundred thousand dollars a month in revenue. But we're burning that money plus more on developers. And after a while, I wasn't interested in moving forward. And I just told him he could have it all. And that's how I ended the partnership.
1:39 Speaker 01 You could look at that as very generous. But at the flip side, when I was starting off as an entrepreneur, Heath and put in hundreds and thousands of dollars. And actually over time, in excess of a million dollars of his own money into our ventures. And I remember a few of them failed. And when it came time to paying back, our loan providers, which were family members at the time, he was excluded from the list. He never mentioned that he forgave the loans. He just removed himself from the list and all the money he put in and didn't want to share the total. And we just focused on paying everyone else and he just said, don't worry about it. But he didn't even mention that he excluded himself. He just on the
2:25 Speaker 01 Quiet and he just pretty much removed himself from being a debtor and just said.
2:30 Speaker 00 So both of you are generous.
2:31 Speaker 01 We were both generous. And he's been generous from day one. So it's been a really good partnership.
2:37 Speaker 01 When we had our first ad agency ACS back in the day. We had a few other partners that ended up joining the company. One of them was from the pharmaceutical industry. He was a really good sales rep. Him and Heath and went to college. So he went to Cal or UC Berkeley, whatever you want to end up calling it. And the guy was working out decently well, but when things started getting bad in the 2008 recession. It started to go haywire and we just closed up shop on ACS. And we had mediation because there was, he filed to sue us. I don't know if he filed to sue us with the court, but he started sending demand letters saying you guys did fraud and all this kind of stuff.
3:22 Speaker 01 And we were stealing money is what he was claiming. So we just provided him with the bank statements and we said, please show us where we're stealing money. So we went to mediation in San Francisco.
3:36 Speaker 01 They had all the files, the bank statements, et cetera. They couldn't prove that we're stealing money because there wasn't any money to be stolen really from that business. And we even got audited.
3:49 Speaker 01 My guess is someone was telling the government that we're doing funny stuff because our.
3:55 Speaker 01 The person who works on R and M finance used to be an ex auditor and he's like, they won't stop. He's like, they just keep coming and prying and prying like as if we. Did something wrong or found money. And the government didn't find anything wrong. He couldn't find anything that we did to steal money and we were using Wells Fargo. We're like, here's all the statements. Here's a login. What more do you need? But he owned 10% of a software company that Heath and I own. So what we did during the mediation is we gave him nothing for the ad agency because it wasn't working out. The other company was producing profits. We bought out his shares. And he agreed to amount. We gave him a check. And it was a good deal for us at the time and it was a good deal for him because he wanted cash and it was a win-win.
4:38 Speaker 00 Yep. I'll give you some examples from my end. So. I remember, remember I had that, that SEO AB testing thing. And we had a, I had a technology partner for that one. And what I realized with that was that.
4:55 Speaker 00 You know, the saying in management is like, what got you here won't get you there. And I realized that was the case, that we were kind of capping out from a tech angle. And I realized that I didn't think this was the right long-term partner. So we had a conversation about this and he's still a great guy. It's not like we're on bad terms or anything. I was like, hey, either we dissolve this thing or I'm just gonna have to take the whole thing over. But I don't see this going anywhere, like our partnership continuing on. And then he was, I remember he was pushing really hard to at least keep a piece or whatever. And he's like, what if this becomes like really big? I'm like, I don't think it's gonna become really big, first of all. Second of all, I don't even know if I'm gonna have time to focus on this. But you know, no matter what, I think this partnership, like we can't continue. And we dissolved the partnership that way and I ended up, you know, legal paperwork and all that and.
5:40 Speaker 01 What kind of business?
5:41 Speaker 00 It was that, it was a software.
5:44 Speaker 01 Okay.
5:44 Speaker 00 Yeah, so that was, that's one example, but I have a couple more examples from high school friends, right? There's, I think, two or three occasions where I worked with high school friends. And my biggest mistake I made on this one, this is like a little side quest, is that when you partner with someone, they have to be as intense as you are, like their intensity for work has to be there. They have to love work, right? And no knock on my high school, I still talk to all these people, but I just realized that like when I'm working the whole time and when I see someone posting a Snapchat that they're cooking meatballs or whatever, when I'm like in the middle of the day and I'm like working and I see that over and over and over, it starts to just piss me off, right? And then, and then when you give them feedback, they don't like the feedback either. And also because they look at me from like the same high school me too, as I can tell.
6:28 Speaker 00 And so it's hard to get work done that way, right? And so in that case, it wasn't really contentious, but it did get to like a boiling point where I was like, hey, guys, like we just need to have a conversation here. What do we want to do? Do you want to dissolve this thing? Do you want to keep it? Because I remember for the senior living business, I had put in like a hundred grand or something like that. And we had, and I'm like, I'm gonna keep putting money into this thing. And if I'm gonna be the investor and I'm gonna be working my ass off too, like I need to see the same intensity. If that's not happening, that's the right time to have that confrontation, that conversation. Because here's the other thing, and you and I both know this. If the business starts to take off, it will get harder and harder to dissolve that partnership. Because they're gonna be like, oh, it's becoming more valuable. I'm gonna just sit it out for a while, you know what I mean?
7:08 Speaker 01 Yes. It it's best to have the conversations that are tough right away when things are going uh wrong versus waiting in essence nip it in the butt.
7:19 Speaker 00 Yeah, and I would say the again, the longer you wait, the more painful it will be long term. It's better that you have that hard conversation straight up. It's gonna be hard at some point. It's either hard now or harder later.
7:30 Speaker 01 Yeah.
7:30 Speaker 00 So.
7:31 Speaker 01 On a side note, you also had a partnership dissolving with single grain.
7:37 Speaker 00 Mm hmm.
7:37 Speaker 01 How'd you end up doing that?
7:38 Speaker 00 Oh, yeah, you were part of that. Yeah, so the single grain partnership, so single grain is not my original company. Um, it is Neil's cousin's company, Sujin. And so we we all still talk, by the way, and we when I see Sujin at a conference, like we'll hang out and we'll grab food. We hung out at a SASTalk a couple of years ago in Ireland. Um, so um, I think everyone, everyone in that partnership is doing well. Most, most everyone's doing really well.
8:02 Speaker 01 Um, I think everyone is doing.
8:04 Speaker 00 Yeah, everyone's doing well.
8:05 Speaker 01 AJ is doing well.
8:06 Speaker 00 Yeah, so there I like to say it was four brown guys and one yellow guy. I'm the yellow guy.
8:10 Speaker 01 Uh, that's right.
8:11 Speaker 00 Yeah.
8:12 Speaker 01 Heath and I are brown. AJ is round.
8:14 Speaker 00 Yeah, and Sujin was around.
8:15 Speaker 01 As well, yeah.
8:15 Speaker 00 Yeah, so, okay, here's the deal. Um, at the time when I joined, I'm sure nobody would care at this point. It's been so long. Um, but because of the the the work that we're doing didn't, it wasn't as effective anymore as an agency, right? And that's why I was brought in initially. Um, and then a year into it, I think you and Sujin were talking and then you're you're you're we I think the three of us had a conversation. And then it was basically like Sujin wants out of the company. He's just like, he's been doing it for a while. He's burnt out, which is fair, right? Um, and so basically, um, okay, Sujin was gonna go out. It sounded AJ was tired of the business too. He.
8:48 Speaker 01 Well, AJ was already out.
8:49 Speaker 00 AJ was already out. Yeah, yeah. He so he went to go focus on the other company, the the limitless thing, right?
8:53 Speaker 01 Kimberly Schneider.
8:54 Speaker 00 Yeah, Kimberly Schneider and all these things, right? And then there's like, there's like, um, other other businesses in there, like, you know, getting buff and all that, right? Like gym stuff too. Um, so AJ was already out and then um, Sujin and I were talking. And then you were like, whatever.
9:10 Speaker 01 Well, no, so the business was doing decently well. It was growing. Um.
9:16 Speaker 01 Heath and I were driving leads. Heath and I own twenty percent combined.
9:20 Speaker 00 Yep.
9:20 Speaker 01 Then the business started having financial problems.
9:23 Speaker 00 Yep.
9:23 Speaker 01 Mismanagement of cash.
9:25 Speaker 00 Mm hmm.
9:25 Speaker 01 Uh, not blaming anyone for just mismanagement of cash.
9:28 Speaker 00 Yeah.
9:29 Speaker 01 Heath and I didn't care. We're just like, cool, you guys can have whatever you guys want. We just bowed out and moved along because we never did this to make money. It was more like, yeah, we're driving leads. Give us something other than that. We didn't really care.
9:41 Speaker 00 Yeah.
9:41 Speaker 01 Um, and then it ended up being where AJ in essence, I think bowed out or did you give him money at that?
9:48 Speaker 00 AJ, so Sujin bought him out. So there's a deal there. Sujin bought him out.
9:52 Speaker 01 Okay.
9:53 Speaker 00 Um, and then the deal that we arranged with the, with the five of us and, and I think, um, there's still some shares, I think, left for AJ. So basically it was, um, or maybe he was out already, but it was a dollar for your shares for ten percent. It was a dollar for Heath and shares for ten percent. So out of pocket, I paid two dollars, which is all the money I had at the time, uh, two dollars out of pocket.
10:11 Speaker 01 He had more. He's joking. He's being facetious, but legally when you're buying shares, you typically have to give something.
10:18 Speaker 00 Yeah. And then the other piece was, uh, the rest was seller finance, which I didn't know the term at the time, which means that you're paying through the profits of the company and that would go to Sujin. Um, and I actually, so we, we ended up doing that deal, but it was amicable. Nobody was really like a, a pain in the butt or anything like that. Uh, but we got that done through lawyers and then, you know, everyone signed and then that was it. So that's an example of five people, not even four people, but five people. And I actually made the company go from bad to worse and then.
10:42 Speaker 01 I was about to say, yeah. It almost went bankrupt. How many times after you took it over?
10:47 Speaker 00 Uh, two.
10:48 Speaker 01 Two.
10:48 Speaker 00 Something like that.
10:49 Speaker 01 And the early years and then he was able to recover it and started doing better.
10:53 Speaker 00 Yeah. And so like great, uh, I, I enjoyed the experience. Would I do it again? No. Uh, the recommendation is if, if you don't want to buy something that's going down because, um, at the time, like it, if a business was going really well, nobody would sell out, right? Like, let's just call a spade a spade. Um, but.
11:12 Speaker 01 Well, if, if the offer is good enough, then everyone will sell. But at that time, none of you guys had enough money to. Pay each other a handsome multiple if the business was doing well. Like if the business was making two million in profit, none of you guys could afford to buy each other out.
11:25 Speaker 00 But the biggest problem was the work that we're doing didn't work anymore because of Google Penguin and Panda. So there's algorithmic changes and the work that we're doing didn't work anymore. So it was actually, you had to basically rebuild the plane while flying it.
11:37 Speaker 01 Got it.
11:37 Speaker 00 Yeah. Frictionless Growth Marketing hosted by Sonya Thompson is brought to you by the HubSpot Podcast Network, the audio destination for business professionals. Frictionless Growth Marketing hosted by Sonya Thompson shows how modern brands grow by removing the friction in their marketing and customer experience that pushes customers away every single day, often without leaders even realizing it. Each episode delivers practical insights, real brand examples, and conversations with marketing leaders showing brands how to win with the new rules of growth, identity-driven marketing, cultural relevance, and frictionless customer experiences. Listen to Frictionless Growth Marketing wherever you get your podcasts. So anyway, that's how we, so that's dissolving partnerships the right way. I think we've always been respectful.
12:20 Speaker 00 Even when it's contentious, you try to just understand what the other side wants and try to get that deal done.
12:24 Speaker 01 Yeah.
12:25 Speaker 00 By the way, let's switch over to, so I have this, I found this on Instagram the other day, but it used to pay to switch jobs. So it's interesting because remember that your rich BFF, she had one where it's like, yeah, every two years you've got to be up or out. It's like basically that got a lot of views. Everyone's like, yeah, I gotta switch jobs, right?
12:41 Speaker 01 And then what did I say when I saw that?
12:43 Speaker 00 You said, you commented, you're like, this is BS, blah, blah, blah.
12:46 Speaker 01 I was like, this is just terrible advice.
12:48 Speaker 00 Yeah. And you commented and I don't know where that went, but here, Wall Street Journal posted this, right? So it says, "Job Seekers Hit Wall of Salary Deflation." So it was inflating a lot during COVID times, right? 2022, it went up a lot, 8% wage growth for job switchers and stayers. So if you're a job switcher in the gold over here, you went as high as 8% if you switched jobs, right? Now it's deflated, it went from 8% over to like 5% or so.
13:13 Speaker 01 What's the bottom line?
13:14 Speaker 00 The bottom one's a job stair. So job stair, you might get like, you know, five and a half wage, wage growth, like over time, so.
13:24 Speaker 01 But now it's pretty much even.
13:25 Speaker 00 Now it's even, yeah. It's closer than it's ever been. And I think if you truly like, it's hard to see this like just numbers wise, but long term, I think you're probably better if like if you're a high performer and you don't want to start a business, you don't want to take risk, you're probably better off staying somewhere because you can make a lot doing that because.
13:41 Speaker 01 And climb the ranks.
13:42 Speaker 00 Yeah. And there's there's nothing wrong with that.
13:43 Speaker 01 And that was my argument with your rich BFF. She's like to get to pay the most, you should switch jobs. I disagree with that because if you want to be the CEO or CMO or CFO, in most cases, you're going to get there by climbing the ranks. Now, if you're a CFO at another company or CEO another company, sure, you can switch to another one and go into the same role, but a lot of the people who get to the top do there by climbing their way up and sticking around at a company for a long time. Now, the one thing I'll tell you, though, is if you're at one company too long, a lot of times you'll find that your career trajectory slows down. So the moment you hop to some other large corporation, you have a better title and promotion or whatever it may be, you're managing more people.
14:27 Speaker 01 And then you come back to the original company they used to work for. They usually treat you better, give you a better title and pay you well, and then you're on a much faster trajectory.
14:37 Speaker 00 Dude, reading the Nvidia way, um, there's a lot of people that left and would come back because they're addicted to that culture of working hard. And again, they would work Saturdays. Again, Jensen would come in at nine AM and work till 12 AM or so. And and then I I think I sent you the quote. He's like, you know, I find work relaxing. When I don't work, I think about work and like it's just like it's and to an extent, I do find work is relaxing. You know, I don't really, um, I get annoyed. I don't really get stressed. I don't know about you. I don't think you really get stressed either. I think you probably you probably get more annoyed than anything.
15:06 Speaker 01 Stressed about work?
15:07 Speaker 00 Yeah, I don't get stressed.
15:08 Speaker 01 I get stressed.
15:09 Speaker 00 You do?
15:10 Speaker 01 Yeah, I'm really good at controlling my emotions.
15:12 Speaker 00 So yeah, I get annoyed, but I don't get stressed. Um, I don't know. No, would you agree or disagree with that?
15:19 Speaker 01 You get stressed. I've seen it.
15:21 Speaker 00 When? When?
15:22 Speaker 01 Like when your company is almost about to go under.
15:25 Speaker 00 Yeah, but still, what do I do? Okay, what? Okay, give an example. What did I do?
15:30 Speaker 01 You get stressed. Like you can just see that you're different, like you're you're more trying to figure it out. It's bothering you.
15:36 Speaker 00 But that was 2022, 2021, 2022, these acquisitions.
15:40 Speaker 01 Yeah.
15:43 Speaker 00 I didn't see you because I was living in Miami.
15:45 Speaker 01 Yeah, but we were talking on the phone. You're more on tilt in poker terms.
15:49 Speaker 00 Yeah, so I was annoyed. I was annoyed, but not stressed.
15:52 Speaker 01 No, but that the financial burden and all the things that were happening at the time put pressure on you. It was adding to stress.
16:01 Speaker 00 Here, let's define what stress is. Let's just Google this really quick. Stress. And but continue on, continue on.
16:10 Speaker 01 Okay, so so I'm not saying you behave differently where you started yelling at people or anything like that. I'm more so saying you were under pressure and it was stress, but CEOs manage stress. That's what they're really good at. Just because you don't always show it to everyone doesn't mean you're not stressed out.
16:28 Speaker 00 Okay, annoyance is a reaction to something specific that irritates you or frustrates. I get irritated very easily. Right? That's true. Agree, right? Okay. Stress is a broader, often more intense response to a situation that feels overwhelming or threatening. It's triggered by external pressures like deadlines, major life changes, challenges that meant that demand a lot from you physically or mentally. Stress activates your body's flight or flight response, releasing hormones like cortisol can lead to physical sense intense muscles, rapid heartbeat, whatever. So my point of saying I'm not stressed is when you look at my biological metrics at that time, my sleep is fucking perfect. I'm not losing sleep, stuff like that. People are like they start to panic and stuff like that. That's not me because I get annoyed.
17:06 Speaker 01 I don't think being stressed means you lack sleep. I think you're the person and I'm very similar. When things go bad for us, it adds pressure. It can create stress, but we're fighters. We fight. We don't just say, oh, I'm gonna stay in a corner and be by myself. We go fight hard to go and solve the problems.
17:26 Speaker 00 Okay, this is so great with AI. Yeah, stress can absolutely affect your health, including your sleep. When you're stressed, your body stays in a heightened state. Think elevated cortisol levels, faster heart rate. So I'm saying and a mind that won't shut off that I'm saying that wasn't me.
17:38 Speaker 01 No, but I've been stressed and my sleep is perfectly fine.
17:41 Speaker 00 So that's you. I'm not even talking about you. I'm not talking about me right now.
17:43 Speaker 01 No, I know, but I'm saying you could be.
17:45 Speaker 00 You cannot argue with this. This is this. Now we're talking AI here, right?
17:48 Speaker 01 But who says that if you're stressed, you don't sleep well? You can be stressed and still sleep.
17:52 Speaker 00 It says it right here.
17:54 Speaker 01 So it says if you're stressed, you will not sleep well.
17:57 Speaker 00 Stress can absolutely affect your health, including your sleep, right? When you're stressed, your body stays in the high.
18:02 Speaker 01 It can.
18:03 Speaker 00 Stress, sleep takes a direct hit. Stress can make it harder to fall asleep. Your brain's too busy racing, stay asleep, you wake up more often or get. Here, I'll tell you when I'm stressed. Here, let's use this example, okay? Are you listening?
18:15 Speaker 01 People still, I Googled it. You can still get great sleep if you're stressed.
18:20 Speaker 00 This is me irritated right now. All right, so, so let me tell you this. When I'm stressed, it's like when I talk to you about dating, for example. Remember that situation? That is stressful. I lost a ton of sleep over that. Remember when we're trying to save a certain person?
18:38 Speaker 01 I know prime business case that you're really stressed that I cannot mention on the video because of your outcome.
18:45 Speaker 00 Did I lose sleep over that?
18:48 Speaker 01 No.
18:49 Speaker 00 The only time I lose sleep is over like interpersonal relationship or things like that. That's what I'm referring to. That's my definition of stress, right? So that, that is like, I don't lose sleep over business, but over that type of stuff where I'm trying to like save someone's life, like that is extremely stressful to me. And even like with my personal situation, like moving back here and all that, like that is stressful to me and, and I've talked to you phone on the phone about that. Uh, but my point is, and by the way, your definition of stress, my, my definition of stress, like it might be different, right? But I think.
19:17 Speaker 01 And we're both using the internet. It doesn't mean AIs right or my versions, right? Cause on my version, it says that you can have great sleep and still be stressed.
19:26 Speaker 00 What, what's he were in stuff? Well, yeah, stress does impact everyone.
19:29 Speaker 01 Yeah, like Double, you, you know, Double, his version of stress is very different than your and my version of it. You and me are very, we're similar, but I would say we're different than most people. If I look at most of my friends group, when they're stressed, they're not like you and I where we just fight and we just push forward.
19:46 Speaker 00 How do we even get to this topic?
19:49 Speaker 01 Cause you said this is AIs definition, AI is right.
19:52 Speaker 00 No, but how do, which topic were we on here?
19:56 Speaker 01 I have no idea.
19:57 Speaker 00 Let's move on, but so, so I think that the lesson here for everyone, I, I, I think there is a key takeaway here is.
20:04 Speaker 00 When Neil has to deal with difficult things, and I've seen him deal with difficult things, I don't really see you panic. And when I have to deal with really difficult things on the business side, I don't really panic or lose sleep or anything like that. Like, my heart rate doesn't go crazy, right?
20:18 Speaker 01 You do on the personal side.
20:19 Speaker 00 Yeah, on the personal side, because I think there's a lot more emotions involved with that. And because I can't really control that as much as I can with business. If business fails, I think I can deal with my failure. But I don't think, it's harder for me to be out of control on the personal side. You know what I mean? Those are things that are out of my control, and I think that stresses me out.
20:37 Speaker 01 I'm the same for both business and personal.
20:39 Speaker 00 Yeah.
20:40 Speaker 01 It doesn't change much for me at all.
20:42 Speaker 00 So you don't, yeah, so you don't really panic or anything like that?
20:45 Speaker 01 Uh-uh. But we're both very similar, where you and I, and I think that's a really strong key of a good entrepreneur. Doesn't mean we're the most successful or anything like that. We both fight really hard when things go bad. Most people look at when shit goes bad. You're the same way on your personal too. If you recall, personal issues you had, you start looking for solutions. A lot of people just give up. And in business, when things go bad for us, like the economy, or we lose clients, or things that aren't in our control, we go and try to figure out how we can make things up and keep progressing forward.
21:18 Speaker 00 Yeah. No, I want you to think in the past, any situation where I've panicked at work. We could talk about it after. Because Noah's seen me for 2017 to 2022, or something like that, so five years.
21:30 Speaker 01 I can mention one right now.
21:31 Speaker 00 No, you can't mention it right now. Mention it after.
21:35 Speaker 00 Alright, that is it for today, guys. Please don't forget to rate, view, subscribe, and we'll see you tomorrow.
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