Accountability and Expected Value with Taylor Pearson

Jeff Root:
Taylor Pearson: Thanks for having me on, Jeff.
Jeff Root: Of course. Let’s start here with a little bit about you and what you do.
Taylor Pearson: My name is Taylor Pearson. My background is in digital marketing consulting for about the past half decade. I’ve worked in digital marketing either as a freelancer consultant in the agency or with a company. Over the past year, I have transitioned to working just on my own as a consultant and then moving into scaling that up and doing some more writing and publishing as a way to promote and generate leads for that.
Jeff Root: Awesome. When you say writing and publishing, you’re actually coming out with a book, right?
Taylor Pearson: I’ve got a book coming out the end of June.
Jeff Root: Cool. We’ll get to that later in the podcast. I initially asked you to be on here because I had a request from an industry magazine to answer a question asked by a new agent in the business. Instead of writing a long article about that, I figured I’d talk to the person about masterminds. I’m going to read the question verbatim real quick so we can get some context here in the problem we’re solving here. The question reads, “What is your accountability method? As we all know, advisors often fail because they do not hold themselves for the things that must be done to succeed. What do you do to ensure that you hold yourself accountable, and that you are held accountable to your goals and activity?”
When I got this question I knew right away for me it was our mastermind. You and I have been masterminding for over a year now. On the phone every single week consistently. You’re the expert in this. You put it together, you run it. I’ve heard you talk about it a lot. Let’s get into that. Tell us what a mastermind is.
Taylor Pearson: A mastermind is based around this idea that came from a book called Think and Grow Rich which was published probably a hundred years ago now. This guy named Napoleon Hill went out and he basically interviewed the most successful people of his era, so Andrew Carnegie and Rockefeller and all these industrial titans to try and figure out what their secrets to success were, so to speak. One of the things he noticed was all these guys hung out together, and they all competed with each other and used each other for accountability. They had this mastermind trust of other individuals they relied on. They could go to and say, “Here’s what I’m going to accomplish.” They had these people both to help them accomplish that, like sort through and talk through those challenges, but also those people to keep them personally accountable to actually getting the work done.
The mastermind concept today, our mastermind and other masterminds I’ve run, are based around the same premise which is get a small group, usually four to six people, who are motivated and commitment and smart. Set up a weekly call, or some people do it bimonthly. Set up a regular recurring call to get in one place and have goals which you set for yourself that everyone else in that call holds you accountable for. That’s the basic breakdown of a mastermind.
Jeff Root: Yeah. I can tell you that every week you and I and everybody else on our mastermind call, we talk about what we’re going to accomplish this next week and what we accomplished over the previous week to hold ourselves accountable to what we say. I know I hate getting on that call if I didn’t do what I said I was going to do. You know?
Taylor Pearson: Yeah. I think it’s a natural tendency, or what most people seem to naturally believe, is you should just be able to hold yourself accountable. I’ve tried that so many times and never been able to do it successfully. Peer pressure and social pressure just works extremely well. There’s a lot of times where I will do things I don’t necessarily want to do whether it’s making a bunch of cold calls or something that otherwise seems unsavory. I just don’t want to get on the call with five other smart dudes that I respect and be like, “Uh, I didn’t do what I said I was going to do.” It’s like that’s far more embarrassing than actually doing the work.
Jeff Root: Totally. Yeah. What would you say are the major benefits to joining a mastermind?
Taylor Pearson: I think one is what we’ve been talking about which is that accountability. If you set a goal, you said, by next week I’m going to accomplish either X … I like to have it be something that’s either falsifiable so it’s an event. I’m going to do this and then I’m going to send this proposal or I’m going to make X number of calls, fifty calls, a thousand calls, whatever it is. You have something which you can either definitively have or have not accomplished, so the accountability portion is big. Then also problem solving. A lot of times it’s very easy to get caught up in your own head thinking about one way to attack a problem. If you air that problem out to other smart people in your industry who are thinking about the same stuff, they can help you sort through your own thoughts to figure out the solution a lot faster than you doing it on your own.
Jeff Root: Absolutely. For me, also it helps me to keep aiming higher on top of that. To make sure that the stuff that I claim I’m going to do or that I want to do, that it’s not just easy stuff that I know I can knock out in a couple of hours. It pushes me to aim higher and pushes everybody else in the group to aim higher as well. Also, one of the things too is, in our mastermind … I can only speak for us. We all run different types of businesses. We’re all sales/marketing guys. That’s the foundation of what we do, so we share a lot of the same things. I tried to get a life insurance mastermind together and it didn’t go too well. It just felt like the dynamics were off. I had a couple of life insurance agents flat out tell me they didn’t want to share some information out of fear of another life insurance agent stepping in on their market or one of those things. I almost think it’s good to find people outside of your actual industry, for us life insurance agents at least. Find other entrepreneurs that are also sales and marketers. Do you find that to be the case?
Taylor Pearson: It’s often the big, big, wins come from outside the industry. If you stay inside your own industry, everything flows together. If you look at technology start-up web pages, they all look the same and they have the same format. Everyone is copying everyone else. It’s only when someone comes in from the outside and brings out those big ideas. I look at what you’ve done in life insurance. You were in these internet marketing industries, and you’ve brought a lot of that innovation into the life insurance industry. That wouldn’t have been possible if you had just stayed in your own industry.
Jeff Root: Absolutely. It all happened really a few years ago meeting up with our group. I think I met you in Thailand almost two years ago now. Since then my business has completely morphed. I used to be a decent internet marketer. Now it feels like I’m a bad-ass internet life insurance marketer. I feel like I’ve figured some things out. I wouldn’t have been able to do that if I didn’t get out of the life insurance industry and joined some masterminds and learned from other businesses besides life insurance businesses.
Taylor Pearson: Yeah. I’ve been feeling that a lot lately. I’m always seeking to broaden those horizons. What is it that I don’t know I don’t know?
Jeff Root: Um-hmm (affirmative). Yeah. Let’s say you’re a life insurance agent and you want to get started in a mastermind, get this accountability thing going, learn from other businesses, teach other businesses the things you know, that type of thing. How would somebody go about reaching out to people to join a mastermind, other business owners?
Taylor Pearson: Sure. I always start with personal friends, people I’ve met in person, personal relationships. I would sit down. I would make a list of five people who I know personally who are … I think the important things seems to be some sort of shared values. If you’re trying to start this new venture, new business, new endeavor, having someone else who’s out there trying to do something ambitious and make something happen, who are the four to five people that come to mind you can think of that are on a similar path. Then sit them down and just explain this concept. You can either send them this podcast, or there’s plenty of resources online about masterminds and what they are. Say, “Look. You know, I think I want to make this happen. If you’re committed to making something else happen, let’s get down and let’s make it happen.” I generally find three people is plenty. Four to six seems to be optimal.
Jeff Root: Um-hmm (affirmative). Yeah. Okay. As far as structure, for somebody that’s never done a mastermind before, would you recommend the same as ours?
Taylor Pearson: Yeah. The structure I like is a weekly call for one hour set on a recurring basis, so just pick a consistent time. We do ours at the end of the day Thursday, which seems to be a good time because it’s towards the end of the week when everybody is getting a little bit more reflective. It’s also not on a Friday if people are trying to get out of town or it’s a long weekend or whatever. Have it be a recurring call. Then everyone starts off. Say there’s five people on the call, four people would do just a quick update. That’s three to five minutes. All you’re going to say is your progress towards you goals from the last week. Last week you set out eighty-three percent of our goal. What’s your progress towards that goal?
If you have any big problems or big opportunities, something that’s come up, bring that up. Then if someone wants to dive into that, you can do it after the call. Have the bulk of the call about forty to forty-five minutes for one person to be on the hot seat, which is to really go deep into one person’s problems. You’d have five people on the call, four people would give a three to five minute update. Then one person would come on and they would, make sure they prepared for the call, spend twenty or thirty minutes talking about some of the biggest problems in what they’re working on then. Have everyone, that collective intelligence, work on helping them solve that problem or take advantage of the opportunity, whatever seems to be more pressing.
Jeff Root: Right. I cannot tell you how valuable that has been for my business at least. Being in the hot seat seems intimidating, but to get feedback on problems that are in your head that you really can’t get out, just articulating it out loud to another group who are asking questions and probing, that in itself helps you maneuver through a lot of these challenges in your businesses and a lot of these limiting beliefs that you might have as well.
Taylor Pearson: I think a lot of people, I know this was true of me, kind of hesitate because you’re like, “Oh, this is going to be embarrassing.” It is. I think almost every time I get on the hot seat, I feel embarrassed. I’m like, “Oh, why haven’t I figured this out?” Or, “This sound stupid.” But it’s always eventually helpful. Every time before I get on the hot seat, I’m really nervous before the call for thirty minutes. I’m like, “Oh, God. What are these guys going to say? This is going to sound so dumb.” Every time it’s immensely valuable.
Jeff Root: Yes. Absolutely. Okay. Cool. I think we’ve covered masterminds there. I want to get into your book. It’s called End of Jobs, which is an amazing read by the way. I read it last night. Why don’t you give us a little bit of a summary of what it’s all about.
Taylor Pearson: The book is called The End of Jobs. The big picture summary is that what is going on at a macro economic level is that the factors which are moving in the macro economy, primarily globalization and technology, are making jobs as institution more competitive and less profitable. Those same forces are also making entrepreneurship more accessible, safer, and more profitable than ever. It’s kind of a 21st Century career path guide in that sense.
Jeff Root: Yeah. I could talk about so many things in there. Your book is completely relevant to what’s happening in the life insurance industry. Our industry is going through a distribution transformation right now. Life insurance has been sold belly-to-belly for over a century. Within the last fifteen years there’s been a trend to consumers buying online and over the phone. Right now it’s about a 50/50 split according to the latest stats. I really love the piece in your book that … There’s a lot of pieces in it, but one that’s sticking out right now, and it’s relevant to me because I am a former poker player, and a lot of former poker players are becoming entrepreneurs because they get the map and understand EV, or expected value. I’d like to talk about expected value because a lot of life insurance agents are scared to invest in their online marketing and acquire the next generation life insurance agent skills that are becoming more and more important. The internet marketing, just the online presence. I don’t think many of them understand expected value. Can you explain what expected value to you means first?
Taylor Pearson: Yeah. Let me give a bit of background about expected value. The concept is, if you look at poker players, let’s say you’re playing a hand of poker and there’s one card left to be shown. Let’s say you think you have a twenty percent chance to win that pot, and the pot is worth twenty thousand dollars. You have a twenty percent chance to win. If you multiply that out, there’s a one in five chance you win twenty thousand dollars. Your expected value in that case is four thousand, twenty percent times twenty thousand. It it costs you a thousand dollars to see that last card, it’s a good expected value bet for you to pay a thousand dollars to see that card. If you could do that a hundred times, you would end up on top. Paying a thousand dollars for four thousand dollars is a very straightforward proposition. It’s very easy to convince people to do that.
One of the psychological biases we have as humans, and this is from some work a psychologist named Daniel Kahneman did in his book Thinking, Fast and Slow, is that we tend to be more loss averse, which is when we see this possibility that we might lose something we tend to avoid really quantifying the probabilities of losing it and what the implications are. A lot of times people will pass up on those opportunities, even though they have a positive expected value, just because they’re afraid of losing a little bit. As it relates to entrepreneurship, one of the things I noticed around a lot of my entrepreneurial friends, people we hand out with, was a lot of them were former poker players. They had gotten into entrepreneurship because they saw the same math playing out that maybe you start five ventures and four of them lose, but the expected value is high enough that in the end you still win.
Jeff Root: Um-hmm (affirmative). Yeah. That’s what stuck with me about expected value in your book was that while no individual opportunity is guaranteed to pan out, like an agent pivoting to an online or phone sales, systematically pursuing opportunities with a plus or positive expected value means you’re going to find success over time. You go way deeper than that in your book, but to me that translates to life insurance agents in that you know where the industry is headed. We’re reading the statistics. We know we’re doing our research online. Consumers are doing their research online. It’s a positive expected value move to make a pivot right now. It’s the right move, but it may or may not pan out. That’s okay. If you keep with it and keep making those moves, eventually it will pan out. That’s what I took for it with a lot of the way our industry is thinking right now and making this pivot to online, expected value is a great concept.
Taylor Pearson: The thing that the poker analogy doesn’t really capture, but that is perhaps more significant, or the two things are, one is that part of what the internet has done is it’s made these bets a lot cheaper. If you wanted to go start up a business twenty years ago, you were buying real estate and you’re making all these capital intensive you had to pay a bunch of money to get stuff. That’s not true. I suspect your first internet marketing ventures weren’t very successful, but they were also probably relatively cheap. You buy a domain name for fourteen dollars. Compared to putting down … If you want to open a store at a physical location where you’re signing a two-year lease for thousands of dollars a month, even paying well over five thousand dollars for a one-time website, is much, much, less expensive. The other aspect that’s not captured is you get better. You learn from those failures. Each time you make that bet, your probabilities increase.
Jeff Root: Yeah. Like you said, it’s so much easier to start a business because of the internet and technology right now. Like you said, the costs associated with it are a lot lower so your risk is a lot lower too. There’s just so much upside because the internet is connecting us to everything, to everyone. I think that was the next section in your book after the expected value was how technology is eating the world.
Taylor Pearson: Yes. Very much so. One of the original subtitles was The Dying Middle Class, which I eventually changed. Part of the implication is the middle class is definitely dying. I think the popular reaction to that has been telement it and try and prevent it. It’s just not really going to work. The nature of technology and what’s going on is that the middle class is going to die. My encouragement to people is, it’s going to die so exit up. If it’s going to disappear, get on the right side of the chasm that’s forming.
Jeff Root: Right. Right. Not diving deep here, but in a broader sense it’s seeing how much safer it is to choose entrepreneurship over a job or doing things the way they’ve always been done because of everything happening in our economy right now.
Taylor Pearson: Right. I think that’s the new ground I wanted to break, that was the message that I thought wasn’t getting told, even by a lot of entrepreneurs, is that because of what’s going on in the economy, because of the changes that are happening, everyone is going to have to become an entrepreneurs eventually. The way we’re headed with technology, and the way we’re headed with globalization, is that all these roles which are clearly defined where someone is giving you a system which you are in charge of implementing and you’re not, in fact, creating or innovating the system yourself, those roles are going to either move overseas to where the cost of labor is very low, or they’re going to be turned into software.
You’re going to have to do it eventually. Is it better to actively invest in it and prepare yourself than let the forces happen to you and be in a situation where you’re not prepared. Where someone is laid off or they have some event like that where all of a sudden now they’ve got lifestyle overhead. They’re paying a mortgage. They have a family to support. Now they’ve all of a sudden got to develop this entrepreneurial skill set.
Jeff Root: Right. I think I was reading somewhere recently about how some of the top skills for future generations are either being in technology or being in marketing. Either of those two because you can’t really replace either of those two. That’s just where it’s headed.
Taylor Pearson: There’s an economist from Georgetown named Tyler Cowen. He spent a long time studying all this. His assertion is basically that. There will only be three “industries” or roles in the future, which are selling technology, marketing technology, or building technology. That’s pretty much all that’s going to be left.
Jeff Root: Makes a lot of sense. I can dig much further in this. I don’t want to give away your whole book. Where can people find you and read more about what we’re talking about, End of Jobs and so on?
Taylor Pearson: You can find me at Taylor Pearson, you just type it into Google. My URL is taylorpearson.me. The book is on Amazon. It is called The End of Jobs.
Jeff Root: Perfect. I’ll link to all this in the show notes at selltermlife.com. Taylor, that was awesome. I appreciate you coming on the show and sharing your wisdom with us.
Taylor Pearson: Thank you for having me on. Thanks everyone for listening. If you want to ask questions, please feel free to reach out.
Jeff Root: Awesome. Thanks, Taylor.