Innovating in the Gig Economy

Intro (00:09):
Welcome to innovations and breakthroughs with your host, Rich Goldstein, talking about the evolutionary, the revolutionary, the inspiration and the perspiration and those aha that change everything. And now here’s your host, Rich Goldstein.

Rich (00:33):
Rich Goldstein here, host of the innovations and breakthroughs podcasts, where I feature top leaders in the path they took to create change. Past guests include joke, Polish for Oland Frazier and Kevin nations. This episode is brought to you by my company, Goldstein pat law, where we help you to protect your ideas and products. We’ve advised and obtained pans for thousands of companies over the past 27 years. So if you’re a company that has software or product or a design, you want protected go to Goldstein, pat law.com, where there are amazing free resources for learning about the patent process. And you could email my team at welcome Goldstein, pc.com to explore for a match to work together. You could also check out the book I wrote for the American bar association that explains in plain English, how patents work it’s called the ABA consumer guide to obtaining a patent.

Rich (01:19):
I have with me here today. Aaron Hageman, Aaron is the founder of DDI that’s delivery driver, Inc. It’s a third party human resources and driver management firm that specializes in the last mile of delivery. And they also operate as part of the gig economy. Uh, this year DDI will make over a hundred million deliveries, including a hun, including 10 million meals this year. They’re also projecting that they’re gonna onboard and prove more than 300,000 drivers, which compares to just about 20,000 a few years ago. Um, Aaron’s been an entrepreneur in various businesses for 25 years and he uses this experience to provide mentorship and entrepreneurial education to students of all levels. He also donates his time to addressing homelessness in the home, in his hometown of Southern California. I’m very pleased to welcome here today. My friend, Aaron Hageman. Welcome Aaron.

Aaron (02:09):
Hi, Rich. Thanks for having me on the show today.

Rich (02:12):
Yeah, absolutely. My pleasure. So, um, so long before you got to DDI, uh, you’ve been interested in entrepreneurship in long before you got to, uh, DDI, you were interested in entrepreneurship, so, but how did you get into it? Uh, like what was your first business or what was really the thing that got you on that path?

Aaron (02:32):
You know, I’ve really had the opportunity to work for myself throughout almost my whole career. Um, where my first real taste came was when I was in college and I was doing a lot of pending catering and I had the opportunity to really kind of work my own gig as we would call it these days, set up my school schedule a couple of days a week, find some clients where I could have some consistent corporate, you know, breakfast, catering jobs on some other days of the week. And I got the taste for working for myself, felt the early tax responsibilities of having to earn, you know, a lot of earnings this way through a business and things like that. And it was really fun and got the bug while I was in college.

Rich (03:17):
Hmm. Yeah, I could relate to. Um, and, uh, and, and so, um, how did, what you did in college then shape kind of the type of activities that you you followed after you finished up with college?

Aaron (03:30):
One of the things I did when I was younger, that I think was important to my development is I’ve always been interested in law and, you know, going eventually to law school. So I went to school, study, political science, international relations, you know, history, things like this tending to go to law school. But one of the things I did was I interned with the district attorney when I was younger. And I realized pretty early on that I was not a lawyer that, you know, when I was much better suited to be an entrepreneur drive the business, have the lawyers work for me. And Leon will really work in these worlds DDI, as we know it is, you know, it lives in employment and labor law in and around 10 90 nines versus W2’s independent contractors, all of those things. And so, uh, knowing that I didn’t actually wanna go down the law path, finding another route, uh, uh, really was I think, an important early dynamic, a decision plan.

Rich (04:24):
Oh yeah. Very interesting. I actually, um, intern the DA’s office also, which told me I didn’t wanna go into criminal law and that was for sure. Uh, but it, it is interesting. It’s like it kind of shaped like what you wanted to do. Like you were acquiring certain knowledge and you, I guess you saw a path to it applying it in a different way. Not necessarily being a lawyer, but, but you’ve been using that knowledge, um, to innovate. And, and so essentially it, it sounds, I mean, it seems like DDI came out of like innovating, like how people understand than how they’re served by following the regulations or things of that nature.

Aaron (05:09):
Yes, that’s true. It started the business in the, uh, late 1990s. So first year in business, 1997, um, really it was about supporting a few local restaurant. A third party delivery company is in Southern California for a few hundred drivers. And at the time understanding the regulatory landscape and saying, well, what are the rules? Instead of everybody trying to fit a square, you know, PE to a round hole as it were, it was just understanding the rules and then helping everybody craft a business model. And we started looking at it from an HR support standpoint on how to run a program proper these days. We look at everything from onboarding through the accounting and tax relationship, risk management, you know, contracts, insurance, everything on the backside to make sure that with the drivers, uh, you know, looked at with the drivers’ lens first brought to mind that everything is done properly. And then, well, yeah. So to your point, it’s been a shifting landscape started in the nineties and here we are 25 years there.

Rich (06:14):
Yeah. And, and, and ironically, it’s kind of what you shifted was the delivery, like the delivery of the information that you had, uh, to, um, and the, and the model from like, just initially, um, helping to guide a few people to then creating, using the info, to create a whole, uh, framework for people to operate inside of like you created a platform, right? Like you, you moved from consulting platform.

Aaron (06:39):
Yeah. That’s a good way to look at it. It’s always been a, you know, for thinking from an entrepreneurial standpoint, DDI has always been a service business, but over the years it has for scale and scale of economy been more and more we’ve invested in technology. That’s enabled us to, you know, really per form our service as a technology enabled service. So it’s definitely evolved over the years.

Rich (07:04):
Yeah. And, and so, like, I, I guess what role has technology played in allowing you to serve more customers than you did when you initially just working with a few people?

Aaron (07:16):
That’s a great question. Where do we start? Really, for us, it’s a matter of looking at, we’ll say our operations, and if I keep it simple today, we can look at a couple of main pieces, onboarding new drivers, and then handling the accounting and tax relationship, more integrations investments into technology have allowed us to scale those operations, move through a much higher volume of applicants on a national basis with speed and the data integrity and, you know, uh, systems integration, moving it along. So it’s been integral to put it simply.

Rich (07:52):
Yeah. Great. And, and so, um, I think we were talking earlier about like how there’s been a shift with regard to the giga of me. There’s been a shift with regard to public perception. There’s been a shift in regulations, uh, and it’s been, it affects now hundreds of thousands, um, of people in California, if not millions of people, like the way in which the regulatory structure shifted the way the public perception has shifted. So kind of what did, what did you, what opportunity did you see to innovate that allowed you to, to better support people kind of through this transition of kinda, um, technology, culture and regulation?

Aaron (08:35):
Yeah. Uh, again, a good question. Big question, rich. Um, so when we think of the economy, it’s what we understand it and talk about it in the public these days. And we call it the gig economy. We call it the last file for delivery. Um, but really what it is, it’s the continued evolution of technology, evolving different industries and allowing for more, what we know is, you know, solopreneurs and individuals to succeed. You know, our, the kids have grown up in a generation behind us, of course, that understand, Hey, I can make money on TikTok. I can go and be a graphic designer and put myself out here, here, here, and here, and not have to work directly for a traditional job. So it’s been exciting in that. It’s a continually, and again, I think it’s a theme here today, shifting landscape of regular and, and everything behind it. But as this normalizes, what’s exciting is that there’s a whole new level of services and opportunity for the, uh, individuals and the entrepreneurs that are working in this market, whether they’re drivers, driving Uber, Lyft and delivering groceries and things like that, or their, you know, graphic designers, uh, working from home for a bunch of different firms.

Rich (10:00):
Yeah. Got it. And so you’ve created, um, various tools to help them to support them.

Aaron (10:05):
Yeah. Uh, some new products, for example, that come around in the insurance space. So direct easy access to dental insurance, to medical insurance, to lifestyle types, products up, you know, identity theft or pet insurance. These types of products are things that we may take for granted having disability insurance. And if we get sick, we have some wage protection as a traditional W2 employee. These are programs that are more and more accessible with the normalization of the gig economy for the workers these days. And we’re super proud to have been on the forefront of this conversation. And now, you know, doing the technology platforms here at DDI for quite a while.

Rich (10:44):
Yeah. Great. So, so in a sense, you’ve noticed kind of where the gaps are and you help them, you help to provide the, the, the things that they haven’t had access to, like, like insurance. So like me insurance and things of that nature. And, um, yeah,

Aaron (11:01):
We talk to the workers. That’s really what it’s all about. We have a regular cadence to continually get the pulse of what the gig economy workers are looking for asking them. And it’s like all workforces, isn’t a continually evolving and shifting conversation today. They want some basics tomorrow it’s of 401k programs and, you know, advanced auto insurance, things like that. But we see a certainty percentage of the market that are looking for business education, advanced, you know, understanding of how the taxation programs work, things like that. So it’s pretty exciting.

Rich (11:32):
Yeah, absolutely. And so what type of challenges you, you, um, are, are notable that you’ve faced in growing the company, the way that you have in terms of grow, let’s say growing the team or scaling, like what, what are the, the main scaling challenges you’ve seen in that regard

Aaron (11:49):
For us? One of the things that’s been, uh, a good, uh, challenge along the last two, three years is as, as if you take a step back and we look at the company again, from an entrepreneurial standpoint, DDIs, you know, been on what we would call a 10 X journey and done it once or twice over the last couple of years. And that’s been a lot about scaling our team, our thought leadership and everything along those lines, as proud as you can be of the team members that you have when you start the journey two, three years ago, there’s only so many of you, right? And if you need two or three times, the headcount what’s been really excited for me as a leader has been continuing to balance the, uh, molding of external talent and, and rooting outside talent in and executives and operators and leadership level, uh, personnel. And then our internal talent. I look at my executive team and it’s literally a, a pretty balanced, almost 50, 50, uh, representative team that shows, you know, internal and external talent over the last few years. So finding that balance, finding those talent, those people, and building the team along the way in a rapid journey is big, big challenge for us, but it’s been fun.

Rich (13:02):
All right. Well, let’s, let’s, um, shift a bit and talk about, um, kinda entrepreneurship and, and mentorship. And I know that’s something very important to you that you’re very involved in mentoring people of all different levels. So, um, kind of, first of all, like what’s important to you about mentoring people. How does it, how does it serve you or feed you to, um, to work with other entrepreneurs?

Aaron (13:25):
Well, there’s a couple of things I think about when you ask that question, one is when you have an opportunity to teach a subject, whatever it is, and, and offer your perspective on a subject to somebody, and maybe you’re saying, here’s how we did it, and you’re helping somebody solve their problems. I have found that as the teacher, we really learn a lot. We learn how to reiterate the fundamentals we learn when we say something, Hey, here’s how we do it. We see, oh my gosh, we’re actually off on this piece of that equation sometimes. So it’s really great to continue to teach the subjects keeps you sharp. Uh, on one side secondarily, one of the things that I have found through all of my peer groups and mentorship groups and different groups, uh, you know, uh, groups of this nature is that by looking at our challenges through an alternative juxtaposed lens, you know, how you handle a hiring challenge from my business as an HR firm to your business over here, that is in the construction industry, uh, really helps provide clarity, uh, on issues. And so sharing these perspectives and, and mutual challenges from an entrepreneurial standpoint is vital. It really is.

Rich (14:43):
Hmm. Yeah. So, so it’s like you find that by, um, sh helping other people by sharing with other people that you’re able to better see your own issues of your company or the, the things that, um, the challenges that you’re facing

Aaron (14:56):
Exactly. Or sometimes we can’t even see what is it, the forest through the trees, right? You look at the same issue that you’ve tackled in your business for the last 18 months, and you’re banging your head against wall, your leadership team, as smart as they are, and as capable as they are there banging heads against the wall. And sometimes all you have to do is go and talk to your friend that, you know, runs a restaurant group. And they say, Hey, here’s how we handled that. Or here’s one of the things we did that didn’t work, but you say, Hey, we might be able to really goes a long way to helping solve, you know, your challenges or, you know, challenges of others.

Rich (15:29):
Yeah. It’s funny one, well, one of my favorite isms about coaching that, um, one of my mentors told me was you’re always coaching yourself. Like, so it’s kind of like you, when you’re coaching, when you’re mentoring, you notice the, the same type things that you always notice in your business, you’ll notice in their business. And it’s like you, to an extent you’re talking to yourself when you, uh, when you give them guidance and, and advice. So it’s, uh, kind of, this is what comes to mind when you describe that. Um, and I’m wondering like, like, like what type of, of guidance that you think would’ve been helpful to you as you’re growing your business, that’s kind of like now you’re helping other people. It’s like, you’re providing them with, you know, if you might say something that you wish you had while you were coming up with it. So it’s like, kind of like what, like what type of support you think would’ve been helpful to you that, that you are now providing?

Aaron (16:24):
All right. My head goes right to rapid scale businesses. And again, we’re talking, you’re creating for medium to large, you’re going with through a 10 X journey on here. And some advice I had heard and took and wish I had moved faster on was, uh, from, uh, a Fred Brian Smith, uh, CEO, OFS boots. And it’s when you’re on this 10 X journey is to lean into an invest into your finance team and you planning team, right. Have our operations. We’re so focused on growing our business. Do I have the warehouse? Do I have this? Can I serve my customers? Whatever it is we do, right. From a business standpoint, but it’s to invest in the corporate and the planning, the finance team, and candidly, I’m really good with numbers. And it’s something that I thought, oh, okay, I’ve got the strength. I continue to carry some load on this side, but the what workload, when you’re going through scale on this, out of the business, it starts to become just bigger than I think we anticipate.

Aaron (17:22):
So it was good advice. And it was advice looking back that I think I’d wish I’d leaned into a couple of years earlier, another step or two would’ve really served us to help us move out a little bit faster so that when you needed that lot, and people start, you know, doing due diligence on you to give you some lending for the bank or whatever it is you need to move just that step faster to keep up with the 10 X scenario, having that organizational pros, would’ve been awesome, you know, one step or too faster.

Rich (17:52):
Yeah. I think that’s a message that I need to hear. I I’ve been hearing it over and over again from, from people it’s just like, get, get that like CFO type person, get someone in there. Who’s really looking at your business and making financial projections. And so it sounds like you carry that mench, that message to your mentees. Um, and, uh, and it comes from that. You realize that that’s a message you ought to have heard earlier on. Uh, I love that. What else do you think that entrepreneurs kind of need to know on their journey? You know, such a broad question, but again, it’s kind of, where does your mind go? When I, when I ask the, of kind of like, like, what do they need to know that no one’s saying to them,

Aaron (18:36):
Wow. Let’s see if we’re thinking from a mentorship angle, sort of the, the lens of the, the conversation here. I really think it, the idea there’s a great book, uh, called, like, I think it’s the big red S and it’s the, you know, be the Superman syndrome out of the way. And so it’s get the hell out of the way. It’s really the message to many entrepreneurs. And we have that first taste of success. You know, you first couple hundred thousand annual village, you maybe have a team member you on your team and you have the success, but at the end of the day, it is always about building a team. And it is always about finding a way to replace yourself or pick your analogy to take off another hat. That’s a good analogy on here, right? We all wear a bunch of hats, it’s entrepreneurs, which is true, but it’s also the curve. So we wanna figure out how to continually do that. There’s the coaching, there’s discipline. There’s a lot of ideas around that, but this is often a subject that I think, especially with entrepreneurs, trying to get to that first million or two in sales and to that next step, that’s, that’s a regular conversation.

Rich (19:51):
Yeah. So kind of like, um, always have your attention on how do you get yourself out of it? How do you, whatever you’re doing, like, how do you, how do you delegate? How do you like, you know, how are you going to scale this, that you are not necessarily putting all your attention on, on this? Or, um, it’s like, how have your attention on scaling from the beginning might be a way to put it

Aaron (20:15):
Always thinking a planner to ahead, you got your org chart today. What’s it look like tomorrow. And when you achieve that one, what’s the next one look like you’ve gotta have something that you could sort of be planning towards, but you ask a great question, right? Which is how do we delegate? And it’s hard for talented young entrepreneurs and idol don’t mean young by eight, by any means, but you know, you know, newer entrepreneurs, right, exactly. To, to delegate on here and a conversation in a lesson that I found that works really well is the, the idea that 80% is okay. And here’s the analogy of where I go with that. Meaning you’re the best salesman that you will ever be rich. Nobody’s gonna hire you for IP law, for your firm, better than you, you know, your stuff, you’re passionate, you’re the entrepreneur. And it’s gonna be the same story.

Aaron (21:02):
Whether you sell flowers or you sell HR services that right, nobody will ever be 100% your equal as the sales rep. But what is okay is that two sales reps who are pretty darn good that get to about 80%, the rep you are, are sure, one and a half times the person you are individually, right. And it’s the idea with that. And you can put this idea over and over to me. I should have applied it to the finance team. You know, Aaron, a couple of good finance people behind you, you know, could take us further than you can on your own. And it’s like, yes, I see that now we’re moving faster and can apply it over and over. And it’s often with sales and talking with whatever our growth block is. So how to get de and how, how do you get outta the way? How do you check your ego? It’s a, a never ending battle, but this idea of 80% is okay, it’s a, a coaching angle. I try to lean on little bit.

Rich (21:58):
Got it. Yeah. And, uh, I mean, I think it reminds me of a principle that, that I talked with other lawyers about, um, you know, some of years ago in a presentation, which had to do with, you know, we have our own standards for things. And as long as you are fixed on, everyone has to do them the same way as me. You’ll never be able to grow. You’ll never be able to scale. You have to, to at some point begin to let go, um, of the notion that it’s gonna be exactly the way I would do it, um, and recognize that it could still be okay. And, and, and I think what, what you’re saying fits into that’s like an 80%, it’s like an 80% standard of like, if it’s, you know, 80%, then, then like, and you can delegate it, then that’s, then you can let go is maybe one way to put that.

Aaron (22:48):
Yeah. And there’s a lot of ways to interpret, to think about it, you know, can you keep your standards high? And what does 8% mean standards are there, but maybe the outputs a little slower. Yeah. Maybe you close five sales a month and they close three or four. Right. But when you start to look at it in this sort of way, it, it allows you to consider scale of economy because then you start to, well, okay. Maybe we can move a little faster. Now the sales, engine’s a little bit bigger if I take a step back and just coach the sales reps and have three of them on the team, instead of just me all the time and start to think of it that way, we’re now to your point, thinking of scaling the business from the beginning and always looking at that.

Rich (23:30):
Yeah. And just a recognition that you’ll always hit the wall, as long as it’s all about you, it’s like a, anything. That’s all about me as the business owner, the entrepreneur will hit a wall at a certain point and like growing a business from, from zero employees, till 10 employees to 25, to 50, to 200, you’ll hit different walls. And, and in general, you know, it’s about finding talent, but it’s about being able to let them do their job, I guess. Right. And having your attention on, are you gonna move these things from being something I do to something that all the people do, you know, or something that one person does to something that a team does or something like that.

Aaron (24:17):
Yeah, very true. And again, as we think of the scaling organizations and teams, it, the leadership dynamics and people in your teams also starts to evolve cause something we’ve experienced in DDI over the last couple of years is at the beginning of the journey of scaling up, you know, pre COVID flooring field on the fire and everything for us and helping accelerate delivery growth and things like that. Uh, we’ve had, we had a great management team, small leadership team, and really not much of a, a formal executive team and building that has now me from an entrepreneurial standpoint, running a leadership group, not of managers and leaders, but of executives and leadership groups. And they have their management team. So what you have to do and started to enable executives, or really talented, smart people that you know, are around your team, becomes a different role. And we have to continue to evolve and shift as leaders. And all of that is part of that scaling journey.

Rich (25:19):
Awesome. I love that. Uh, any other advice for, for entrepreneurs, any other things that like in working with, um, with, um, mentor, uh, mentees and, and, uh, you know, with, uh, other entrepreneurs, like things that you think that, that people that are on that journey of taking a note, an idea from in here to bringing it out into the world that, that they ought to, um, that they ought to know, or you like to share with them?

Aaron (25:45):
Um, I guess it’d be two things just short and sweet, you know, it’s pretty common sense stuff. Um, and for me, I combine the two things together. So one is, uh, so, so cheesy to hear me say it, but it’s really never stopped learning. I mean, it is, you know, for, from this point of your career, to that learning as an entrepreneur, learning as an operator to your industry and what you do, it doesn’t matter. You can’t stop learning because we have to continue to evolve. And in this day and age technology, the world we live in culturally, et cetera, is changing so fast that you have to have that skillset and that agility to learn and adapt and learn and adapt and apply. It’s a skill and secondary don’t. You don’t have to go alone. You really don’t find your local entrepreneur group mastermind group, you know, where you and I met rich, for example, um, from, or your different business group or, or whatever it is big or small. And for me, then this is why I start to apply this idea of learning along with my business group, people and friends, and you realize, wow, you know, this is there’s people who have done this. Nothing we do is entrepreneurs, you know, less, uh, a lightning strike every now and then it’s really new. Everybody’s been on before. So that’s my, I guess, closing advice from today.

Rich (27:07):
Awesome. I love it. And some people wanna learn more about you get in touch with you, how do they go about doing so

Aaron (27:13):
LinkedIn, LinkedIn is the fastest, easiest way for me. So it’s Hageman with an E in there. H ha G M a N. Um, yeah, I, me on there, Aaron Hageman it’s easy enough.

Rich (27:22):
Awesome. I love it. Well, thanks so much for taking the time and, and doing this interview and I appreciate you, and I appreciate the time that you dedicate to other entrepreneurs, to the homeless, um, population and to, and to really people out there that you give your gift to. And I appreciate you,

Aaron (27:39):
My friend. Thanks rich.

Rich (27:40):
Thank

Speaker 4 (27:40):
You.

Outro (27:45):
Thanks for listening to innovations and breakthroughs with your host, rich Goldstein. Be sure to click, subscribe, check us out on the web@innovationsandbreakthroughs.com and we’ll see you next time.