Francis Pedraza is the CEO of Invisible Technologies, an operations-as-a-service company that works with clients to solve complex scaling challenges and optimize mind-numbing workflows. We discuss ways to delegate at the speed of thought, how to stop wasting time on routine tasks, and the drawbacks of using an outsourcing company.
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EPISODE 149: Delegate at the Speed of Thought with Francis Pedraza
Steve, I love your energy. Thanks for having me.
Well, I’m excited because, you know, outsourcing automation. These are two topics that I’m into, and you have developed an interesting framework and a kind of different mental approach to it. So I’d like to learn about that. But let’s start with your journey. How did you even get into this business running a technology driven outsourcing business, how does one start a business like that? How does the idea come up?
The long story would be that I started a company in college that failed, and then I started a company after college that failed, and then I started a company after that that failed, and then that led to a version of Invisible, which failed, which led to this version, which is succeeding massively. So like Russian dolls, right? And yet there’s been a consistent golden thread throughout all of these projects that really has been like one, in a sense, it’s only ever been one company. It’s been one long journey, one long evolution. The thing that has driven me for my whole career is this question of human potential, human productivity. We have all these incredible tools. We have the iPhone and the smartphone. We have, you know, our laptops. We have the Internet. We have apps. And yet there’s this feeling that we could be so much more creative and productive than we are.
And there was a very simple question that was like my light bulb question, which was this question. There’s an app for everything. So why isn’t everything perfect yet? And I realized, okay, Uber drives cars for you. But who drives apps for you? And there is a whole automation industry. There’s more and more automation tools. But if you’ve actually tried to use these tools, no one tool can solve all of your operations problems. So you go through all this setup, and then you set up and you run it, and it solves 5% of your problem. And then you got to add another and another, and then you end up still having to do work yourself and to have an operations team of your own. There’s also the human labor approach. So this exists for both individuals and for companies. For an individual, you could hire an executive assistant, but if anyone has ever worked with an assistant, you realize that in one hour, you can delegate 10 hours of work. And so there’s no assistant that can keep up with a big delegator, right? And so, pretty soon, your assistant needs an assistant, and your assistant’s assistant needs an assistant, and so on and so forth. And that obviously doesn’t work.There's an app for everything. So why isn't everything perfect yet? And I realized, okay, Uber drives cars for you. But who drives apps for you? Click To Tweet
When it comes to operations, there’s the entire outsourcing industry. The outsourcing industry, the business process outsourcing industry, the mental image you should have is like a very large building in New Delhi, India, or in Manila in the Philippines, where people are key carding in and they have computers and you’re outsourcing work to that organization and they’re billing you by the hour. That business model is like a $280 billion a year industry worldwide, it’s huge, and it’s growing fast. It will grow to about half a trillion by 2030. But I think that understates it because if you’ve ever tried to use an outsourcing company, it’s not a great experience. They generally take a lot of work to get them to actually understand your process. Once they understand your process and are running it, they’re billing you by the hour. So their incentive is to be as inefficient as possible without getting fired, to bill you as many hours as possible. And they’re not technology companies. And what that means in terms of your user experience, in terms of their ability to integrate with you is that it’s a very clunky experience. So I started to realize, okay, there’s the outsourcing industry, there’s the automation industry.
You could hire assistants in-house or build an ops team in-house. But this is not the most futuristic solution. The most futuristic solution would be like an Iron Man suit. You just delegate and you can move at the speed of your mind. And the idea of moving at the speed of thought was very exciting to me. So the way Invisible works today is you can get on a Zoom call with our team and you can screen share and show us any process in your company. You can describe any operations problem that you have and we will build a process for you. We will go through your organization and map all of your processes. Not only we’re going to map all the processes in your organization, we’re going to run the processes in your company. We have a digital assembly line with 1,600 people in 60 countries around the world. But they only do the steps that we haven’t been able to automate. We have an automation team building custom automations, but they’re only building automations that we haven’t used 200 third-party integrations in our process builder to do already.
So we have a process builder that will break your process into standard steps like Legos. We will automate it using 200 third-party tools. We have our automation team. And then if it still can’t be automated, we’re going to build an interface for our agents to run it manually, and that allows us to deliver an end-to-end solution to you. And we bill by the unit, not by the hour. And when you bill by the unit, your incentive is to be as efficient as possible, both to increase margins, to drive quality. It just, there’s a beautiful alignment of incentives. So this experience, you know, again, you might think of it as operations as a service, or, you know, tech-enabled operations, or AI-enabled operations, or automation-enabled operations as a service. It’s fully digital, like we have an app, you go on Zoom, we’ll report to you in that way, fully integrated with your team. It’s like having McKinsey, except it’s free, and except it can do work. That is something that has never existed before, and it’s not an app. That’s the thing. We’re not selling pure software. We’re selling services, but it’s software-enabled services. The automation tools themselves, you don’t want to figure out how to use 200 different automation tools. You don’t want to figure out how to build an elite operations team and build software to run that team. So we’ve done that all for you. And from the client’s point of view, it’s strangely simple. It’s like a black box that can perfectly execute any process. So you just need to give us work and then out comes the other side, the work, it’s done. But you don’t necessarily need to know how the black box works.
So what really struck me was I went on your website and I saw that there are all these little apps. So it’s like you’re like an iPhone. People can say, okay, I need this, this, and this, and that process. So I’m going to download these, I’m going to just press the button. Then as I understand, you create the custom buttons for that particular company, the processes that you haven’t automated yet. You’re going to create the apps for that, and then you’re going to automate as much as you can, and the rest is the assembly line.
You got it. Yeah, you might think of these as process apps. I’ll give you an example with hiring. We’ve grown from 1,000 people on Labor Day to 1,600 people today. We’ve added 600 people in five months, which is really crazy. Our head of hiring uses Invisible to provide hiring as a service to Invisible. It’s very circular. And so if you want hiring, our head of hiring runs a business unit called Argonauts. And Argonauts will be able to provide hiring as a service to you using Invisible, right? So it’s very strange. We use our own services to run our own company processes. And this can be used for everything. So we help food delivery companies, like DoorDash, for example. When you open DoorDash, all those restaurant menus, they had to get inside of that system at some point. How did they do that? They had to be digitized. And you can imagine every single restaurant in every single city in the United States. That’s a lot of messy data. It could be a photograph, it could be a PDF, it could be various formats. How does it get into DoorDash’s database? That’s an example of a process.
You have an insurance company that is processing claims. How do you do claims processing efficiently with technology? We do that. If you’re building a really advanced AI model and you need reinforcement learning because you’re trying to train your model to make more and more intelligent responses, how do you do that? Well, we have masters and PhDs on the assembly line to helping train AIs. So you can have any level of labor. It’s not even necessarily commodity labor. It can be very, very specialized labor. And the insight actually came from Lego. I used to play with Legos as a little boy. And I love the idea that you could break down any custom process. Because every business is like, ah, “Our process is custom. No other company has this process.” And that’s true. But if we can break it down into the Legos, into the atomic units, and we can automate the Legos, or optimize the Legos, then it goes into our Lego chest, it goes into our step library. And so what we think we’re doing is sequencing the enterprise process genome, so that every single time we see a new process, even though it’s new, well, 80% of it isn’t new, right? We’ve done 80% of it before, maybe there’s only 20% that’s new. And then the next time, oh, it’s only 82% of it we’ve seen before, you know, there’s less and less that’s truly new. And what we’re trying to build is almost like Amazon for business processes. We call it the process store. So when you go to our website, the website is the process store. And you can see by industry, by function, by use case, by technology, “Oh, you need processes to run on Salesforce, we got that. Oh, you need processes for your sales team, we got that. Oh, you’re in the healthcare industry, here’s some processes for that.” This is the vision of the company is to come to a world where this is all industrialized knowledge work.
Fantastic. You’ve got lots of great analogies, the process store, industrial knowledge works, sequences the enterprise genome, operations as a service, AI enabled. Love that. This is really catchy. So let’s switch gears here and share with me a framework that you’ve come up with, business framework that the listeners can internalize, which is simple enough for them to understand and perhaps even apply in their business after listening to this episode.
OK, Steve, I can do this, but I need your participation. Is that OK?
All right, let’s do this. All right. So imagine point A, which is where you’re at, point B, which is where you want to get to. Do you know what you want?
Okay. How are you going to get what you want? Strategy is about getting what you want. That’s how I define strategy. Getting point A to point B. about getting what you want. That’s how I define strategy, getting from point A to point B. Now, Steve, are you comfortable sharing what it is that you want with the audience?
Not really. Not on this podcast, no.
All right, fair enough. But you have it in your head, okay, right?
Okay, how many ways can you think of to get from point A to point B? One way or more than one way?
Oh, more than one way, for sure.
Okay, Good. Now how many steps are there? One step or more than one step?
Right, so, and then how many people are involved? Is it just you getting from point A to point B or are there many people getting from point A to point B?
Okay. And are there emotions involved in getting from you to point A to point B, or is it just very, very almost rational, almost like an unemotional process?
Well, if there are people involved, I don’t think that we can dispense with emotions. So, yes, emotional.
Great. So I think this has been a good sketch of strategy already in this exercise. So you have leadership is the political dimension of strategy. You gotta get many people to want what you want and many people to go in the direction that you choose. Grand strategy is strategy overall, but strategy is choosing a path. So it’s path selection, directional. Tactics is about how you literally do the steps. And then heroism is the personal dimension of strategy, which is dealing with your own emotions. And so there are many dimensions to strategy. Strategy is a complex subject. Now, strategy is also something we associate with war and with business. But strategy is just as useful for learning how to cook or learning how to be a better DJ. It’s just as useful to a soldier or a young man as it is to a 42-year-old mom with three kids, as it is useful to a 67-year-old grandfather with four children and 17 grandchildren. Strategy relates to everything, and it’s truly universal. And the amazing thing is that the number one book on strategy is The Art of War by Sun Tzu, and it was written in the 5th century BC, China. And I’ve read this book like 18 times, and I’ve just done a strategy class at our company, and I’m still doing it. It’s like an ongoing lecture series. But in reading The Art of War, I realized that it is full of paradoxes. So we’re going to do an example. Do you like ice cream?Grand strategy is strategy overall, but strategy is choosing a path. So it's path selection, directional. Tactics is about how you literally do the steps. Click To Tweet
What’s your favorite dessert?
My favorite dessert is bread pudding.
Bread pudding. Okay. Now imagine you have some bread pudding in the fridge in your home. And do you eat as much bread pudding as you want?
You try to resist, right? You try to stop. Okay. So this suddenly is you’re in a war against yourself. So you have two Steve’s. There’s the Steve that wants to go to the fridge and get the bread pudding. And there’s the Steve is like the other Steve is like, maybe we shouldn’t have bread pudding in the fridge. Maybe we should have no desserts in the house at all so that I’m not tempted. Right. So this is you playing a game against yourself. And isn’t that interesting? So when you win, you lose. When you lose, you win. Huh. You know, when you get what you want, you don’t get what you want. How does that, what’s going on? Okay, well there’s the Steve who wants what he wants now, and there’s the Steve who wants the six pack, who wants to look really good this summer on vacation, or who wants to live for a very long time or whatever your health goals are. Those are different Steves. And this is true all the time in strategy. So sometimes, for example, you have to retreat in order to advance. Or sometimes a major failure, like your company failing, can be the best thing that ever happened to you. Or in the case of my company, we were trying to raise a Series A, and we got a bunch of companies, a bunch of venture firms said no to us. And if any of them had said yes, we wouldn’t ultimately have been able to buy back our investors and control our own destiny and control our own board like we do today, and have the incredible outcome we have now. So it’s very paradoxical. And a famous moment in movies is Obi-Wan Kenobi against Darth Vader. He says, strike me down, and “I’ll become more powerful than you can possibly imagine.” And “This is actually the way strategy works,” is that, you know, you can lose and you can win at the same time. And there’s an even older book in China called the I Ching, the Book of Changes, which is about time and change, which are inseparable. And it basically, within the 64 cards of the I Ching, you normally play it by just drawing two cards. If you draw any of the two situations, these are like archetypal situations in life, you can get 4,096 unique readings of what you should do right now. So it’s almost like chat GPT before chat GPT. You can ask the I Ching a question. I Ching, what should I do right now and the each thing can say attack retreat do nothing hide These are different situations now if you play with three cards it goes from 4096 to 282,000 something possibilities if you play with all 64 cards The combinatorial math is such that there’s it’s like 10 to the hundred and fifteenth power Which is more than all the atoms in the universe. Combinatorial math is crazy. And so you realize that combinations are essential to the art of strategy. So anyways, strategy is a subject where I still, after all these years, feel like a white belt, not a black belt. I feel like a beginner. But I feel like most, there’s not enough conversation about it and just about how universal and important it is. So I hope that was useful to your audience.So when you win, you lose. When you lose, you win. Click To Tweet
That’s very interesting. So just as an aside, I just read a book on strategy. So I have my own approach to it. And I, I tried to argue the opposite. So I tried to argue that it’s not all intuitive. It’s not all intangible, but there is actually a method to the madness, but that’s another episode. But I love the Sun Tzu. And you also, you have also written your own translation of Sun Tzu Art of War, right?
Yeah, I’ve, we have a company library, which we’ve named after the great library of Alexandria, and we use the Lionel Giles translation, but we have annotated it and made it such a very immersive e-book experience, including using Midjourney, which is an AI tool, to create, you can use AI now to just type in descriptions, and then it will generate art. So I’ve created all of this art to imagine the art of war, imagine like a kid, you know how kids, before they really know how to read, they like picture books? Well, I’ve created the picture book version. It’s awesome. So if you’re interested, you can just email me. I’m at firstname.lastname@example.org. Not .com, .co francis@invisible, like you can’t see me, I’m hidden. email@example.com.
Yeah, definitely get this. I’m going to send you the email as well after the show. So our time is getting to an end. What I’d like to ask you is, how would you pitch your company to a potential employee? So you’ve got all these wonderful processes, you’ve got this automation, you’ve got this app store of processes. Why would someone come to work for your company Invisible?
I’d say come because on our website it says, no employees allowed. We are building a partnership culture. The question I was asking myself when I started the company was, how do I create a company that even if I wasn’t the CEO, I would wanna work at? And one of the things we’ve done is we’ve created a partner pay model. It’s a transparent framework where everyone has equity. And every year, we’re not planning on going public, we’re not planning on selling the company, but every year we do tender offers. So you’re gonna have liquidity on your stock. And that equity ownership and the culture that we’ve built around ownership, because we’ve bought back our investors, we’ve tied all of our incentives to financial performance, creates a meritocratic culture where people really believe that if they put in the hard work and they create the value, they’re gonna get the benefit, not just in the form of cash or bonuses, but also in the form of real equity wealth. And also, now that we’re creating many companies inside of one company, there are opportunities to literally start businesses with us. If you can prove yourself as a leader, and we’ll invest in those business units and give you major economics in those business units. So you can own equity in the top company, but you can even own even more in your smaller business unit. And so what I’m really doing is trying to think of a company where instead of just having one entrepreneur, everybody’s an entrepreneur. And we’re trying to build the most entrepreneurial company ever. So if that’s appealing to you, please email me, firstname.lastname@example.org.
Wow, entrepreneurship as a service. I love it.
Well, definitely check out Invisible. This is an amazing place where all the processes are turned into apps like Lego. You can build your own company out of the Legos of Invisible and you can be an entrepreneur. You can be part of a bigger enterprise. You can create your own enterprise in this app store. So that’s really an incredible opportunity. If I wasn’t self-employed, I would probably check this out. So check out Invisible. Francis, you already gave your e-mail address if people want to reach out to you. So francis.invisible.co.co. Thank you for coming to the show. It was very exciting. I will definitely check out your drawings in Arts of War. It’s time for a refresh anyway.
Awesome. Cheers. Thank you so much. Thanks for listening, everyone.
- Pinnacle: Five Principles that Take Your Business to the Top of the Mountain
- Francis on LinkedIn
- The Art Of War