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2 Employee Thefts – Over 6 Figures – How to Prevent

Well it has been a weird few weeks here!

I am going to share some personal painful stories here…

Two businesses (not adbank) have both had issues of employee theft which is a first for my business! We are not talking hundreds of dollars but over 6 figures!

I won’t get into the exact details but one is solved and one is in the process of being solved.

The key anytime we have a major f-up in our business is to dig in and understand why it was allowed to occur, if the risk of it occurring again is worth putting in stronger systems.

This article will cover the 2 scenarios the systems that were in place and why they failed plus the 5 keys everyone should do if they have any team members with access to hurting your business financially.

Swiss Cheese Model for Losses:

One of the ways I like to think about the risk mitigation systems inside my business is the Hazards – Losses path through multiple layers of swiss cheese. No system can be completely bulletproof but the idea is if all layers are in place and working the probability of all holes lining up is very low.

Failure 1: Speed vs Control Accepted Risk

An employee wired himself funds, oversight was not in place fast enough.

There were 3 layers of mitigation

  • Mitigation #1 – Trusted employee & controlled access
    • Never a sufficient mitigation on its own!
  • Mitigation #2 – Accountant monitoring monthly numbers
    • The accountant was unfortunately months behind not revealing the problem.
  • Mitigation #3 – Bookkeeper/Controller onboarded
    • The controller for the business was not up to speed fast enough leaving a window of time where things would go undetected.

In the end we were not pushing the pace fast enough on the 2 financial oversight systems resulting in a window for theft to occur.

Although this was the far larger of the 2 thefts it is one where no major systems upgrades are needed as there was some acceptance of risk due to prioritization and low probability of someone repeating with the systems that were too slow to get in place now in place.

  • Note – All funds from this theft have been recovered + consideration for time/fees.

Failure 2: Execution

Although the dollar amount is smaller than failure/theft #1 this one has me much more upset.

This was a known risk we had put many barriers against but the systems all failed in the same way to allow this to occur.

  • Mitigation #1 – Trusted long term team member & controlled access
    • Clearly this is not enough to rely on blindly! This employee has been with me for YEARS and involved on multiple projects.
  • Mitigation #2 – Daily Revenue and Expense Monitoring – Temporarily Not Active
    • During this time we had taken a break from the daily expense tracking due to workload in other areas
  • Mitigation #3 – Weekly unit economics review – Didn’t Validate
    • This one is frustrating as this practise was created with the intent of being able to quickly detect any issue however the theft was paired with forged numbers that were not validated. Human error on compliance to the process for validation of the numbers was the reason this mitigation failed.
  • Mitigation #4 – Monthly PnL statements and review – Not setup on new system
    • We have been in the process of upgrading our proper monthly PnL and as a result were not in a position to review them. Getting these completed slipped down the priority list and as a result allowed this issue to continue.

Note – All funds have not been recovered, the length we will go to will be unreasonable 🙂

 

5 Steps to Take:

  • Financial Risk & Access Control Matrix
      1. There are a lot of potential attack vectors. Having an organized control list of all the places that someone could impact you financially and then understanding who currently has access is key. There are the obvious locations like bank account, paypal but then you also need to think about the revenue sources Amazon Account, AdSense account etc. Plus, don’t forget places where funds could be improperly sent from Fiverr, UpWork etc. Don’t forget your websites that make the money, swapping out an affiliate link on a few pages can be another source of theft that is harder to detect.
  • Agreements Updated
      1. Ensuring compensation agreements are in writing is key to ensure there can be no debate about the amount of funds received.
  • Have Contact Information Handy
    1. For anyone with access to money you should have accurate information on them including name, ID, phone number, address etc.
  1. Proper Login & Password Management
    1. Managing logins for a team is a daunting task! 1Password and LastPass are the tools we use for a couple different projects. The key is to be able to quickly turn on/off access while controlling the ability to provide access through either the tool as a user (with the login still in the password management system) or shared access via a password management system. Strong random never reused passwords and 2FA activated whenever possible goes beyond just internal theft but is one of the most basic steps to avoiding theft from hackers.

Conclusion:

I hope you haven’t experienced any issues like these. My hope is sharing these unfortunate events and what I have learned will be helpful in preventing future problems for you or if problems do occur arming you with what you need to resolve quickly.

 

Please share any other suggestions on how to help protect your business!

Long Overdue Update!

It has been too long!

Since 2012 I had been almost always posting once/week with the exception of a couple 1 month breaks.

It has been A LOT longer and this post is to communicate…

  • Where have I been?
  • How have my businesses faired with lack of time on them?
  • What to expect moving forward at AuthorityWebsiteIncome?
  • What has my focus now?

Where Have I Been?

My focus has been and continues to be on the project adbank.network where we have a real opportunity to cause some disruption to a giant problem!

The short version of what adbank does is it is an ad network build on the Ethereum blockchain that has payments transparently flow directly between advertiser and publisher with the middle mans cut finally being fully transparent!

If you are an advertiser or publisher you can test out the beta platform here – https://beta.adbank.network/

 

 

What is exciting is that many of the skills I have developed building my online businesses have been stretched executing on this project.

 

What does my focus mean for my online businesses?

They are going nowhere, I have always been focused on building the systems/procedures and teams to continue the execution of the businesses with as little involvement from myself as possible.

So for each of the business divisions here is how they have fared with me not spending much/any time thinking about them…

My Website Portfolio:

I have continued to let this business slide especially on the monetization side it has been the hardest hit by my lack of focus.

It is relatively easy to systematize the articles (ContentRefined) and links (LightningRank) for the sites but the hard part is monitoring the monetization. Some of the assets continue to do well and even grow despite my lack of focus while others completely fell off the map from an earnings standpoint. Sites that once made $1k-$3k/month with the same traffic now are making almost zero because of a handful of very fixable reasons… affiliate program no longer exists, links broken, advertising paused due to handful of reasons.

I don’t see a lot of focus getting out here with the exception of a couple I have handed off to managers to run including focusing on the monetization of those sites.

This is the benefit of the systematized approach where many systems held and despite me not putting any thought into my portfolio sites the content from ContentRefined and links from LightningRank kept coming.

 

Productized Service Businesses:

I am very proud of the managers on these businesses!

These businesses launched with the initial push from the AuthorityWebsiteIncome audience but without any support for the last months have continued to be strong performers.

Kelley at LightningRank plus another new business she launched off of nothing more then an email idea from me had their best months ever at the end of last year.

Maddie and ContentRefined has continued to grow bringing on additional staff in house and dialing in our ideal client (portfolio managers!)

 

Whats Next at AuthorityWebsiteIncome.com?

Only useful articles!

Right now there is a large team that is pushing hard every day to get sites to perform well in Google leveraging great content and links.

As we push on this basic concept there are a lot of interesting learnings.

So… we will be sharing as much useful/actionable information as we  can related to

 

What has my focus now?

The project adbank.network did a successful token sale and is now actively pushing on 3 primary fronts.

Tech:

The tech development is going very well with plenty of challenges. We have delivered a working beta platofrm on the main net 2 months after ICO.

In addition we have hired a brilliant PH.D. In computer science with a specialty in machine learning and are continuing to grow the team.

Acquisition:

A big part of our strategy is to seed the adoption of the disruptive technology by acquiring existing ad networks and converting them to the adbank platform.

Intellectual Property:

With a patent pending on the application of AI to leverage transactions that occur on a blockchain to fight digital ad fraud we hope to have a winning position in the market.

 

Summary

It has been the craziest project I have been a part of. Very proud of the team behind adbank as well as the team that has continued to grow the other businesses with a giant lack of support from me. They are all very inspiring people!

How Do We Manage Multiple Projects

I was at a great conference last weekend (RhodiumWeekend) and among other things one of the common questions that came up was about how do me and my team manage multiple projects.

What systems, management structure, incentivization plan etc do we use to have a handful of businesses running/growing simultaneously.

Let me first say that although I really enjoy the process of having multiple projects it may not be the optimal strategy for everyone. Continue reading

Humanizing Ecommerce – Live Call and Live Chat Support for Shopify

As my business continues to morph I am enjoying tackling new and interesting projects with the right teams!

At the end of last year I added a Shopify site to one of my sites and this year have added another.

I had been hesitant to jump into Ecommerce because I thought it would be another set of skills I would need to master but have found it to be a great compliment to my business.

Results for My Shopify Store:

Although starting a BUNCH of projects has a BIG downside the upside is it identifies a TON of new problems I can throw myself and my team at to solve!

This post is about a couple of those problems and how a team I am involved with is working to solve them…

Problem/Opportunity:

Humanize Ecommerce by Bringing Live Chat and Live Call Support to the Shopify Masses!

If you are an Ecommerce store owner then it can be very difficult to offer the level of customer support you want to provide to your customers without spending either a TON of money or being attached to your phone instead of doing ecommerce marketing!

People know Live Chat and Live Call support would be nice to have managed but unless they are a giant team there are not many cost effective options!

Live Support Is Not Just About Support – It Is About Sales and Conversions As Well!

Providing a superior customer support experience to your visitors is vital but live support is not just about customer support it is also about increasing sales!

In many studies both a phone number and live chat have been shown to improve conversions!

From MyWifeQuitHerJob “Having a phone number in plain view is VERY IMPORTANT!”

From KissMetrics Both Phone and Live Chat Results…

Solutions…

Live Chat and Live Call Support EXCLUSIVELY for Shopify Ecommerce business owners!

LiveChatNinjas.com

LiveChatNinjas was actually a business that was started by someone else and then me and a team purchased it with the plan of continuing to work on it and grow it.

LiveChatNinjas offers 24hr x 6 day per week support for your customers to answer customer support and technical questions.

Checkout LiveChatNinjas Here

LiveCallNinjas.com

In addition to the team running LiveChatNinjas we saw an opportunity to expand the same audience to cross promote a similar service for phone support!

So a great programmer (turned manager) has put together a very robust system that allows for metered billing and we have a scalable local (Canadian) Shopify and phone support team handling all the calls.

(example usage report for one of our clients)

Checkout LiveCallNinjas Here

To Answer the Inevitable Question…

Typically whenever I talk about a new project I get questions along the lines of “how do you keep everything straight” the answer is a simple structure of meetings and spreadsheets…

  • Daily Execution Standup Meeting
  • Weekly 1:1 Meeting With Each Business Manager where we review the project tracking sheet for their business
  • The manager does all the hard work!

The fun part of some of these type of projects is you never know if you are onto a winner or not… all we can do is put together the best possible offer, price it competitively and get people aware of it/drive traffic to it!

What do you think… are we onto a winner here Humanizing Ecommerce with LiveChat and LiveCall Ninjas?

If you or if you know anyone who might benefit from these services we would love to chat with them and help continue to validate the product/market fit… just reach out to me jon@authoritywebsiteincome.com

We are growing! Transitioning to Hiring and Managing Staff

Both my family (daughter born last week, now 3 kids) and company (3 new in house hires) are growing.

This post is about how I am thinking through the team building process.

Hiring and managing in house staff has been something that has surprised me as being both very profitable and fun! When I left the day job under 1 year ago (my quitting story) I was unsure if my path would take me to having an office and team.

Potentially because my first two in house staff Kelley and Maddie have worked out extremely well (for the most part – they are a little verbally abusive to their boss 😉 ). Don’t worry they won’t read this.

Both existing team members have worked  out incredibly well and when I do a review on what $ spend has had the highest ROI the addition of these two team members to increase my capacity to take on new projects is the highest ROI by a mile!

  • Kelley – Built up the LightningRank.com team and has handled customer support along with
  • Maddie – Managing all of ContentRefined.com while it has been growing at 10%/week for the last 3 months!

So as I continue to grow I am faced with what hiring plan makes the most sense for my business.

Like all other parts of my business my plan is to systematically approach this problem (getting the best possible team members onto my team!)

 

My Current Hiring Theory & Assumptions:

Several Assumptions

  • I never want to hire someone who needs low level management support
  • In the town I am located in the TOP talent is not coming back after graduation to look for work but are willing to come back for Summer CO-OPs and if the work was enticing enough would come back after graduation
  • Culture fit matters, because we are a small team one bad cultural hire could cause us a lot of problems!

My current philosophy on hiring is a rare occasion I disagree with the book EMyth Revisited – In the EMyth Revisited, which is a book I absolutely recommend, it states to systematize a business as much as possible so you can place the lowest possible cost employee that can predictably execute a task. My argument against that is that yes they will be able to execute the task but won’t be able to spot the higher level opportunities I prefer to have someone overqualified continuing to spot additional opportunities and replacing themselves.

 

So What Am I Looking For

Hire smart, hard working people with a proven track record of having grit who will be a good fit with the team!

  • Validate Smarts – Easiest – the usual way grades etc
  • Validate Grit – Previous work or better having pursued athletic (usually) path and demonstrated sticking with something after multiple failures.
  • Validate Fit – Tougher to measure but any sign of self-deprecating humour seems to be a good sign!

 

Lessons Learned:

Not having a company name is getting pretty annoying! When I describe what my company does it is a little confusing to people.

I talk about my 3 divisions…

  • Business To Consumer – Affiliate sites & FBA businesses
  • Blog – Authoritywebsiteincome.com
  • Business to Business – My productized services arm

But it is a tricky business to understand if you don’t have any experience in the space! I need to improve this, name the company and create at least a bit of a landing page with the aim to get people motivated to work here!

 

How Do These 3 New Hires Help You as a Reader of AuthorityWebsiteIncome?

Here are a few things to look forward to as an audience member at AuthorityWebsiteIncome.com

  1. Better and more data intensive blog posts – I will be putting more leg work into some BIGGER posts that I am very interested to see the results of and I hope you will be as well.
  2. More procedures shared – When I am able to package together my procedures and share them with my audience it is usually some of the most useful posts. Expect more of this!
  3. New Productized Offering – As I add capacity to my team I am more capable of responding to requests for additional offerings.
  4. New Tools – One of the hires is a computer science guy who loves hacking together little tools. He will be building a few tools for our in house use and I will be likely sharing access to some free tools.
  5. Improved visibility on businesses – One of the big efforts will be on dashboarding out the business and then creating a more public version of my income reports that shares data more transparently.

 

My Management Process

I often seem to get questions about how do I manage both my virtual and in person team. The answer is pretty straight forward…

  • Daily “Standup” Meeting
  • Weekly 1:1 Meeting Where we Review Scorecard
  • Monthly Update Meeting (business results review meeting)
  • Task List with the MAJOR goals for the work term laid out early

We are not perfect yet definitely but I am happy with the structure so far and I am sure we will tweak it as we go.

 

Increased Capacity to Buy More Businesses!

As the team grows so does our ability to take on more projects!

If you are looking to sell either a profitable website or FBA business please email me at jonhaver11 (at) gmail.com

Even if you don’t want to sell the entire business and have a highly successful business and are just wanting to sell a portion of it to take some risk of the table but still run it to realize the upside I would be interested in chatting with you!