America Is In Trouble

Welcome to MBAgency

I’m David.

The sole purpose of this newsletter is to openly document my wins, and losses, from starting a holding company.

Let’s dive in :)

30 Second Summary

• American Talent is falling behind in certain industries
• Where we source candidates overseas
• Why overseas talent can be your secret weapon

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America Is In Trouble

And in my honest opinion, big trouble.

Let’s rewind to December 2021. I just wrapped up my first full year in business with Pneuma. We pulled in over half a million dollars in revenue and had a healthy profit margin.

I was out to eat with a few friends in the same space. We got to talking about our businesses – the challenges we faced that year and most importantly - the profit we were taking home.

Although I had been in business for the shortest amount of time and had the least amount of revenue, Pneuma outperformed everyone else at the table in profit. In some cases, we even had nearly double the profit.

That’s when the convo quickly changed from “what are you getting for dinner” to “what’s your secret?”

Overseas Talent.

At the time, half of Pneuma’s staff was overseas, earning between $10,000 to $15,000 per year. That put our annual payroll around $100,000. In comparison to my friends at the table, that was anywhere from 2x to 4x cheaper than what they were paying.

But here's where it gets interesting. Despite the huge difference in payroll, the productivity, output, and quality of work were on par, if not better in some cases.

Fast forward to now, Pneuma Media (and the other Pneuma Ventures companies) still relies heavily on overseas talent - even more than we did before.

We do hire Americans, but usually in management roles. For all other roles on the team, we first look at Latin America, then Africa, and finally the Philippines for potential hires.

We've hired overseas talent for all sorts of roles - from finance to development and even project management, and we've found some great fits.

Here's the takeaway: American companies need to rethink their hiring strategies.

Outsourcing to overseas talent not only cuts down on payroll but also brings to the table a level of output, quality, and attitude that can make all the difference in a growing business.

Embracing overseas talent might just be the best decision you make this year.

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Here’s What I Found Interesting This Week…

• I saw this tweet moments before I clicked publish.?To second Andrew, read Profit First if you feel like you’re struggling with cash flow management
• Why?I’m not worried about ChatGPT?(for certain things).
• I love one-person businesses -?this My First Million podcast?was a deep-dive into the topic.