In this episode of Veteran Led, John S. Berry sits down with Travis Mack, Chairman and CEO of Saalex Corporation, as he shares valuable lessons on scaling businesses. A decorated Navy Veteran turned successful entrepreneur; Travis breaks down the crucial decisions leaders face when growing their organizations.​
Key Takeaways:​
• How to identify when to develop internal talent vs. hiring externally ​
• The evolution of company culture through different growth stages ​
• Why structure and oversight increase with organizational growth ​
• The importance of tactical empathy in leadership ​
• Creating equity opportunities to attract and retain top talent​
Explore Resources from this episode:​
https://www.greenwoodselfstoragefunds.com/​
https://www.themackfoundation.com/​
https://valeonetworks.com/ ​
How do you know whether this is a position that you are going to build internally or you’re going to have to buy it? Is this talent you’re going to build or are you going to buy the talent? Which is it, Travis? How do we decide? Because this is where I struggle.
Great question. Whether you build it or buy it, highly technical capabilities that are needed within your organization, in some cases, you’re going to have to buy.
Travis Mack is the Chairman and CEO of Saalex Corporation, a federal aerospace and defense contractor with over 25 years dedicated to Saalex. He has driven significant success, generating over 175 million in annual revenue and employing over 1,200 professionals nationwide. Travis has received the prestigious Small Business Award of the Year by the SBA of Los Angeles in 2015, and he has also served as the CEO of Valeo Networks Information Technology Company, specializing in cybersecurity and cloud solutions. Travis has completed over 10 company acquisitions, exceeding $50 million in value. Furthermore, he is the founder and fund manager of the Greenwood Self Storage Funds, utilizing his 15 years of experience in the self-storage industry to drive returns for investors. Travis is committed to philanthropy and has established The Mack Foundation to provide and support scholarships and educational opportunities to underserved communities. His remarkable journey includes serving in the United States Navy and receiving recognition as a decorated, service-disabled Veteran and degrees and certifications from prestigious institutions to enhance his leadership skills. Welcome to Veteran Led, Travis.
Thank you so much. Thank you so much. Thanks for having me. I certainly appreciate it, John.
Well, Travis, you’re one of the most powerful speakers I’ve heard this year. The reason why is because you say the things that need to be said. And I can remember being at JPMorganChase headquarters hear you speak and you said, you can’t keep the same culture forever. And in fact, the culture that you make to get to that eight-figure business, that’s not going to exist at nine figures. And so you have to evolve as a culture. So I’d like to talk about that. How do you build the culture? And then how do you know when it’s time to evolve the culture?
You build your organization around good people. The size of your business when you start, certainly if you’re successful, it’s going to grow, right? That’s the objective. That’s what you want to do. That’s what your focus is. That’s what your mission is. I will tell you, and as we talked about in the CEOcircle at JPMorgan, I will tell you that at certain inflection points, those individuals that have been there unless they are willing to certainly put in the extra initiatives, the extra education, the organization at certain points outgrows those individual, John. And that’s just the honest aspect of growing organizations. And so you have to take your talent level up, and you have to put people within your organization that actually fit your level of trajectory. And a lot of entrepreneurs, small businessowners miss this. And the reason being is it’s because there is this feeling of, okay, this individual has been with me from the beginning. You know what? They’re going to be able to sustain me as we grow 10X, 20X, 30X, whatever that number is. John, this is not the case. That’s not the reality of growing organizations and growing businesses.
You must elevate your talent level as you go up the trajectory curve as well.
When you elevate that talent level, I mean, sometimes we think of at the entrepreneurial level, we want someone who’s hungry, humble, and smart. Then as we grow, we start to seek more administrative functions, governance, and even bureaucrats in our organization. It does seem to affect the culture. How do you communicate to your team that that’s coming?
I tell my team this all the time, mature organizations has structure. Immature organizations don’t have structure. As you grow, you need more structure. There’s just no… Because of all of the liabilities that are out there, all of the challenges, all of the oversight. As you get larger, you get more oversight from different organizations, especially if you’re dealing in highly regulated verticals. And so that comes with your success. So if you want to argue and say, Hey, you know what? I don’t think I deserve this oversight. Well, then stay small. Be a lifestyle business. Which is a good, which is certainly a reasonable decision for anyone to make. But most folks don’t want to do that. Most folks want to scale. They want to grow. And with that growth comes the additional oversight, comes the additional structure, comes some of that bureaucracy. Now, you as a leader, your job is to try to make it as succinct as possible, to get rid of the unnecessary stuff, but yet maintain and grow some of the maturity some of the structure that you’re going to need in order to scale your organization to the next level.
And so as you look for that talent pool, how do you decide? You say, Okay, we’re here, maybe 10 million. We want to be 100 million. And you’re thinking, Okay, how do I find the right people to bring into the organization to raise the standards without demoralizing or destroying some of your top performers that are rising stars? You don’t want to scare them away. You don’t want to chase them away. You want to keep them. But how do you do that and communicate that, Hey, this organization is changing, and there’s going to be a lot of different… What you like now may not be here tomorrow, but it’s necessary to grow. How do you message that so that the team understands and trusts what you’re doing?
John, I think that’s a great question. First and foremost, it’s about transparency. I think you have to rely on brutal honesty. Brutal honesty and basically tell the organization what you’re thinking. I love looking at my top one percent within the organization. I love looking at them first. Basically, me having to assess whether or not I think this individual can get us to the next level. Now, the next level means a plethora of different things. But A, are they willing to change? Huge. I will tell you that’s absolutely huge because you will get the mindset in some organizations that this is good enough. What we’ve done to date is good enough. We’ve grown. There’s no need for me to learn or do other things. Couldn’t be further from the truth. So they got to be flexible, got to be willing to learn. And got to be, I would tell you, good managers of individuals, of people, understanding how to delegate, understanding how to use your entire team. And of course, we would want someone that comes from inside the organization. It’s a good fit. They understand but if they don’t… If we can’t see some of those other talents outside of them just understanding the organization, then it makes it very difficult for me to say, Hey, you know what?
This is the next person that’s going to get us 20 million and be able to manage. They were maybe managing five people. Now they’re managing 25 people. Do we see those other capabilities within them in order to help us get to that next level. And then, if not, John, I will tell you this. Going outside and looking for additional talent that can bring skills and capabilities to your organization that you may not have within your organization is not a bad event. And I think in some cases, it’s necessary. There are times when you’re going to have to go from a bookkeeper to a controller. There are times that that’s going to happen. And so you’re not necessarily going to have controller skillsets within your organization. So you need to go out to those firms, to those organizations that can help you put that type of talent and mature your organization in those areas. And so those are a couple of mechanisms by which I think that you can scale up your organization.
Okay, so when we’re scaling up and we know that we don’t have the talent yet. Now, you and I both come from the military background where you train leaders, and we love to watch people grow. We love to grow our people. We love to grow our teams. How do you know whether this is a position that you are going to build internally or you’re going to have to buy it? Is this talent you’re going to build or are you going to buy the talent? So which is it, Travis, and how do we decide? Because this is where I struggle.
Great question. Whether you build it or buy it. Highly technical capabilities that are needed within your organization, in some cases, you’re going to have to buy it. There’s just no way around it, because if you’re trying to, and I’m just going to take the aerospace and defense vertical as an example. Look, if I’m looking to go from a controller to a true Bonafide CFO, there is no way that I can build that within my organization because A, I don’t have that skillset. No one within my organization has that skillset. And so I think it’s a matter of identifying if there even is a path for you to build it within your organization, or do you go out and buy it. And I will tell you, when you start to make those really big leaps, I will tell you it’s really important for you to go out and buy the skillset because they’re bringing the capability to your organization that you absolutely cannot replicate currently within your organization. That is a hard… That takes a lot of communication. You’re going to ruffle a lot of feathers. You’re going to upset some folks that obviously within your organization think they should be lined up for that particular role.
But if they don’t have the background, the skillset, and demonstrability, John, I will tell you, is huge. Show me where you have done it in the past. And if they can’t show you that, then it’s not going to be a good fit because it’s unfair to them because you’re going to expect more out of them than what they can give you from their experience, from their educational background, the whole nine yards.
Wow. Yeah. And this is where I have screwed this up-time and time again. It’s like you keep looking for the answer and we get slapped in the face.
We all have. This is trial by fire. Trust me. This is not something that’s innate within your DNA. This is all trial by fire. And I’ve had to learn many, many lessons as you try to progress. You take steps back, you learn, and then you go out and do it again.
But yet that lesson of, okay, I want you to be the, let’s say, for instance, you could buy a CIO, Chief Information Officer, and you bring this person in and you think, okay, this is great, but we have a five-person team. This person’s used to working with a 50-person team. It’s not going to work. They don’t know how to do a lot of the technical functions that you would expect them to do at your level. Then I’ve also screwed this up where I bring someone in, they say, Oh, yeah, I know. I know to get there. I’ve done this. It turns out they come from a large bureaucratic organization where they have been at that level, but they never grew it to that level. They just showed up. It’s like you show up and you’re in the NFL. It’s not like you worked your way up through high school, college. They show up at the top levels and they know how to function at that level. But building it, they’ve never built it. They’ve never seen it go. And so they show up and it’s like, they don’t understand it. No, you don’t just show up and go to meetings. You get s*** done here, and they don’t get.
Exactly. Well, listen, you got to do some of the heavy lifting, right? You got to do some of the work. It’s not that you’re going to wake up and have a whole team at your arsenal, right? But what you do try to pay attention to is those tiers, are those tiers, right? I mean, you can’t go out. At our size, we wouldn’t go out and try to find somebody from one of the big primes. What we’d want to do is we’d want to go out and find someone that’s demonstrated at a billion, two billion, three billion, one of those middle-tier primes that can bring that capability. Because listen, it’s not reasonable to think that I’m going to be able to get to 35 billion in the next 5 or 10 years. That’s just not right. But it is reasonable to think that we’re going to be a billion. We’re going to be two billion. So I would say, look at where you’re at as an organization. Look at your size, and then reasonably say, Okay, we want to be here in 10 years. We want to be here in five years.
And then identify those skillsets, go out and find you some professional recruiting help, whatever the case may be, and then find talent that’s at that level. If I’m half a billion and I’m trying to get to a billion in the next five years, okay, and I know I need a CIO to come in and really give us a robust cyber infrastructure, whatever. I’m going to look at companies that are a billion to six billion. That’s the tier that I’m in. I want to look at that background because they understand what that type of structure that type of environment looks like. And then that’s how I do it. Not reasonable for me to go to the large primes where they’re doing 20, 30, 40 billion dollars because that’s not a good fit. That’s really not a good fit. I got to go to that middle tier in order to really have a solid grasp of where we’re trying to go and putting the right people in the right place where there’s not too much misfit. Now, I will tell you, John, you’re not going to always get it right. You know what? You got to be okay with screwing the pooch.
You got to be okay with not getting it right. You got to be okay with saying, Hey, my bad. I missed that one. More than once I’ve had that happen. But that’s important. But you got to make the decision, and you got to call the shot, and you got to go to the entire organization. If you do screw it up, say, Hey, my bad, but let’s fix it, and let’s fix it immediately. And that’s an important skillset as well to demonstrate to your organization that we’re not afraid to be making these changes. And when we get it right, great. We all celebrate as a team. When we get it wrong, I take the fall for it. I say my bad. I make the changes.
Outstanding. Let’s talk about probably the most difficult part is, how does Travis Mack get the talent? Get the talent to Saalex. How do you… We’ve talked about what we need. Now we know we need it. How are you out there recruiting and bringing those professionals to your team?
Well, I look at this as a team sport. Building teams in the military is number one. I’m also a sports guy, and building teams isn’t around one individual. I often tell people, sometimes you got to lead from the front as a leader, and sometimes you got to lead from the back. Your responsibility and your job is to know when you should be doing that, and really having a gauge of your organization. So how do we bring, how do we compete, bringing excellent talent to our organization? I would tell you it’s about making it worth their while. I can’t expect for you to come and give me 80 hours a week if I’m not making it worth your while. How do we do that? We certainly start off by having really robust benefits. Got to take care of your family, got to take care of your kids. That’s a must. That’s a given. Number two, having those robust retirement vehicles, those 401k’s, and you’re matching, that matters. That absolutely matters. We’ve moved up our vesting schedule to immediate, because that’s something that’s important to everybody. And of course, having a really overall robust benefit structure and HR infrastructure to make it easy to get people on board.
Now, those are a couple of things that we did. I think I took it a step further. I turned Saalex into an ESOP. And what an ESOP is, is an employee-owned organization. So basically, I knew that we were transitioning from being a small business. And I kept thinking to myself, Man, what am I going to do now? How am I going to convince people to come from these middle-market firms or some of these large business firms? How am I going to convince them to come and work with us and be a part of our team? And I said, You know what, if it was me, I’d want equity. If you’re going to ask me to work 80, 90 hours, which is what we do in leadership, then I’m going to want… I want to be a part of it. I want to be a part of the growth strategy. I want to have some equity within the organization. So as part of our growth strategy, going from small business to large business, I turned the organization into an employee-owned organization, to where as 40% of Saalex is owned by the employees. They own 40% of it, and they are vested in the growth.
So as we scale, as we grow, they benefit in that. So not only do they get their 401k, of course, we’re going to match that, but now you got equity. Now you’re part of it. So you have an incentive to get us to a billion dollars. You have an incentive to be part of that, to make the hard decisions, to go through the ups and downs, and to be a part of the organization. And so those are some of the things that I did that I tried to execute in order to, or that we’re executing, in order to help build a really solid team and help us scale to the next level.
Outstanding. As a law firm, we see this all the time. Lawyers like to talk about wanting equity until there’s a capital call. There’s a downside to equity that people don’t understand, right? It’s not just when the money is there, it’s great. When the money is not there, having equity sometimes isn’t a great deal.
Anytime we start talking about capital calls and things of that nature, yeah, absolutely. That becomes a little bit more challenging. But under the ESOP structure, you’re able to literally… The moment that you’re hired, it’s based upon the number of hours that you are working, and then you are an equity owner within the organization, so there’s no capital calls. It’s a really good way to encourage your workforce for the long term and really fight to build that organization with the right people.
Travis, now we move to the AAR, the After-Action Review.
All right. I’m familiar with those.
All right. This is our hot wash. This is where we talk about the good stuff and the bad stuff. I’d love to hear your three great examples of leadership, and then the three bad examples of leadership that may have defined you as a leader and who you’ve become today.
Let’s start with bad leadership. Let’s start there. I’m a bluff kind of guy, bottom line up front. So give me the bad stuff first so I can deal with it, and then we can move on to all the good stuff. Let’s start in my experience, what I’ve seen as far as bad leadership. First, foremost, inconsistent. Just all over the place, doesn’t have a firm direction, can’t make decisions. Inconsistency, and not making decisions, I will tell you, are deaths of organizations. Got to be able to make decisions. Got to be consistent with how you’re making those decisions in most manners. But you have to be able to do that. That’s number one. Number two, and I think the military is great for this, limited viewpoints. The military is a melting pot of everyone. There’s one thing to be said. When you’re in that fox hole together or when you’re out in theater, we are one. I don’t care what your background is. I don’t care where you come from. I do not care. We are a team. You got my back. I got your back. Limited viewpoints where it’s siloed, I think, has negative consequences on organizations because you don’t get the full ocean.
You only get limited perspectives. And I think that limits what you can possibly do or the decisions that you can possibly make as an organization. That’s two. Number three, bad leadership, unwilling to adjust to changing landscapes. When your business changes, or pivots, you as a company have to change and pivot, or you will die. It’s pretty straightforward. And I think we’ve seen this time and time again, organizations that are unwilling to innovate, change, maybe go to a model that their customers are expecting. So the unwillingness to change and pivot, and you trying to force the business model onto your customers versus you adapting to the business model your customers are expecting, I think is a form of leadership that’s lacking. And those are my opinions. So let’s get to three good leadership examples. Tactical empathy for your personnel. I think tactical empathy for the folks that are working with you is really important. Different types of individuals within your organization need different types of support. You need to figure that out. And understanding tactical… I’m not saying sympathy. I’m not saying give our hugs and things of that nature. I’m saying tactical empathy is something that you need to understand, and that’s a level of emotional intelligence.
Us as leaders need to understand that more. I think I talked about this earlier in the conversation. Willing to lead from the front or the back. Huge. That’s good leadership, right? Sometimes I need to be out front, taking the arrows. Sometimes I need to be when we have messed up, when we haven’t done right by our customers, when we haven’t supported our customers to the level of customer service that we as an organization need to adhere to, then I need to be out front saying, That’s my bad. That’s my fault. We’ll change that. Sometimes, though, I need to be in the back. When I’ve selected leaders and they are the ones that are leading the charge, I need to be supporting them. I don’t need to be over their shoulder micromanaging them, telling them we should be… I need to be in the back, and I need to be waving the pompoms and cheering, saying, You know what? Go forth. I’m supportive of what you’re doing. I’m supportive. If it’s certainly in support of the direction and the vision that I’ve given, and they’re executing that strategy, I need to be in the back.
I need to be in the back supporting. Number three, Discipline, discipline, and more discipline. You have to be disciplined as a leader, I think. Discipline will save you when everything else is going crazy. Your discipline that you’ve certainly garnered in the military is one of those characteristics that I think is absolutely necessary and needed as you run larger organizations, which is what we all strive to do.
Outstanding. Travis, where can people learn more about Travis Mack or Saalex Corporation or all the great organizations that you’re involved with? Because I see you all over social media. I see you at all these keynote speaking events. Travis Mack is the guy, and you give so much great information. I sit through some keynote, and I’m like, Okay, here’s a piece, here’s a piece. With you, it was just like, I was just taking notes the whole time. Then I stalked you and sat down at your table at dinner sitting next to you just picking your brain. I’m like, I’m not letting this guy get away. I’m going to get him on the podcast. How do I learn more from Travis Mack? So where can people learn more about Travis Mack and Saalex?
John, first and foremost, thank you so much. I appreciate that. We had a great conversation at CEOcircle, and I’m happy to deliver it. This is a passion of mine because I started from one person doing one task and grew the organizations from there. And you know I do a lot of social media trying to just convey, talking about entrepreneurship, talking about Veterans, how do you grow your business, how do you scale your business, and also talking about motivation, John, which as businessowners and leaders, sometimes we get kicked in the teeth. And we need a few positive words just to get us to the next day. You can find me on LinkedIn at Travis T. Mack, M-A-C-K. You can find me on Instagram at Travis.Mack.CEO, Travis.Mack.CEO. And you can also subscribe to my channel on YouTube, Travis Mack, CEO, as well. And you could find me… And all I do, I don’t do master classes, and I don’t sell anything. I don’t sell any books or want to get you to subscribe something where you have to pay for. All I do, John, is try to pass out information from my perspective, from my lens, and I try to give it to people in hopes that it’s going to help someone else grow and scale their businesses.
And that’s what I like to do. I’m big about health. I think people should be taking care of their bodies a little bit more. So I try to be motivational about that. And I try to give a whole bunch of business information and perspectives from what I’ve done. Now, that doesn’t mean you got to do it. I’m just trying to give you a little lens into how I’ve been able to do some of these things.
Well, thank you so much. Thank you for your generosity, your time, and what you continue to do to give back to the community, especially the Veteran community and Veterans in business. Thank you, Travis Mack.
You know I love those Veterans. I happen to be one of them. Go Navy. Those Army and Air Force folks we’ll talk about a little bit later, but go Navy.
Outstanding. Thank you, Travis.
All right, John. You have a great day, okay?
You, too.
Thank you for joining us today on Veteran Led, where we pursue our mission of promoting Veteran leadership in business, strengthening the Veteran community and getting Veterans all of the benefits that they earned. If you know a leader who should be on the Veteran Led podcast, report to our online community by searching @VeteranLed on your favorite social channels and posting in the comments. We want to hear how your military challenges prepared you to lead your industry or community, and we will let the world know. And of course, hit subscribe and join me next time on Veteran Led.
Our monthly newsletter features about important and up-to-date veterans' law news, keeping you informed about the changes that matter.
