Unlocking Growth Secrets with Eugene Kalinin: Power of Tracking | Curiosity Code 005
14 Mar, 2024
In this episode of the Curiosity Code podcast, Alex welcomes Eugene, a mentor growth tracker and founder of GrowthTracking Net, to discuss the concept of growth tracking and its impact on entrepreneurs and businesses. Eugene shares his journey from running an IT business to becoming a mentor and eventually developing a unique methodology for growth tracking. He explains how growth tracking combines strategic consulting with a set of frameworks to diagnose business problems, identify bottlenecks, and accelerate growth. Eugene emphasizes the importance of setting ambitious goals and regularly testing hypotheses to overcome constraints. The conversation also touches on the universal applicability of growth tracking, not just in business but in personal challenges, as illustrated by a poignant story of a student applying the methodology to battle cancer. Additionally, Eugene shares his observations on the startup ecosystem in Lisbon, Portugal, highlighting its international appeal and the common challenges faced by entrepreneurs worldwide. This insightful discussion sheds light on the power of growth tracking in driving business success and personal achievement.

Alex: Hey everybody, and welcome to another episode of the Curiosity Code podcast. Today I'd like to welcome our guest, Eugene Kalinin. Eugene here is a mentor growth tracker and also a founder of Growthtracking.net. So we'll be talking a bit about track talking today and how it helps entrepreneurs and businesses to grow. Welcome to the show guinea.

Guest: You can call me Eugene. It's much easier for English-speaking people because I often hear people trying to pronounce Russian names the Russian way. It doesn't work. Don't try it. Don't try it at home. Just call me Eugene. That's easier. Hi, nice to meet you. Thank you for having me. That is great to be Eugene.

Alex: You know, since I have a Russian background, it's easy for me to pronounce. So I'm kind of cut my way through here. Let's start the conversation with a little bit about your professional journey. So where did your career start, how did it evolve and how did you end up being in tracking? In growth tracking.

Guest: I have been an entrepreneur since mid 90s, something like that. And I had an IT business for a long time. We did stuff like servers, computers, system administrators, and people who go to the client and fix something that doesn't work. And at some point, it was not a very big business. We did something like a million dollars per year and at some point I couldn't do it anymore. It was after the crisis in 2008, and 2009 where when everything. Well, in Russia, it wasn't Russia. In Russia, this crisis was not that big. It was not that hard for many businesses, but still, it was a crisis. The economy went a little bit down and for me it was probably trigger or something like that. And at some point I just quit. It was an exit. It was an exit. I got some money, but, well, I just quit. And I spent all of that money in a few months. Not that much of some for those times back then. One of the things that I did back then was I started to help entrepreneurs. It was called mentorship at the time. At first I worked with people who were doing a similar business, it outsourcing it, integration services. But then I started helping startup founders. Just because people were asking me for help. It was not something I wanted to do. Problem was, I have spent all that money.

Alex: What kind of help was that?

Guest: That was the thing that was called mentoring back then. When they come to me with some questions and I help them figure out different questions, I help them figure out what the problem really is and then I assist them in implementing the decisions that they made and the problem was that mentorship should not be for money. People don't expect a mentor in the startup world. People don't expect a mentor to charge for their services. And I spent money, so I found a way to charge for what I was doing. And that was a very typical thing. I was helping founders create their pitch decks and financial models. I was helping founders prepare for raising their investment round. And it's not actually when you start doing this thing, you quickly realize that it's not about a presentation or a financial model, it's about diagnosing the business and figuring out what doesn't work in a business. What are unproven assumptions, unproven hypotheses within this business, within whatever the founder is aiming to raise the capital for? And what are the limitations, the constraints, the bottlenecks in their existing business, in the state of the business they have at the moment, the state of the business that they expect to be investable, what is not investable in this business. So I had to figure out how to diagnose a business to show the investor what is good with this business and show back to the founder what is wrong with the business. And very quickly this became, well, they were buying the presentation, they were buying their way to the investment, the chance to raise the capital. But what really happened and what they quickly realized, what they were quickly realizing after starting the work, that it's actually some sort of strategic consulting for early stage founders. And that's actually what I started to do. And this was my starting point for creating the methodology, because the methodology that I profess, that I teach is the methodology for consultants and founders and business leaders management, the methodology that helps them diagnose the business, find what are the main bottlenecks in this business, and then accelerate growth. And that's what I do.

Alex: Before we dive into the methodology and pick more about growth tracking, let's just, for the audience, define what tracking is, because I think tracking is such a unique word that's been used in a startup environment. It's completely different from what you usually use this word for in occasional environment like tracking, like hiking. So what tracking is, it's not about.

Guest: Hiking, it's actually a pun, an intended pun, because there are two meanings. First one is we provide traction, we help the founder, we help the business get traction. And the second, we do that by helping them track their progress over a strategy that we create at the beginning, during the diagnostic phase, the diagnostic process, at the beginning of this relationship. And there comes this word tracking that combines both of those things, tracking progress, and getting traction. A tracker is a person who works with a startup founder or a business leader, a top manager, whoever is running some business or some part of a business team leader works with them, meets them once a week, usually, sometimes once every two weeks, to help the leader realize what's going on in the business. What is their main bottleneck? On their way to grow to growth, then create a weekly sprint. What will they do during the week to help overcome this limitation? Go through this bottleneck, and then a week later they get back together, they analyze what did work, what didn't work, what went wrong, and they devise some conclusions and they repeat this process. The tracker doesn't tell their client what to do.

Alex: Like in coaching.

Guest: Yes, it's a coaching position. The trackers position is a combination of a coach position and an expert position, because unlike the coach, the coach is using whatever content is there in the client's head. They rely on the client's worldview, on the client's view of their business. A tracker is using a set of frameworks, like starting with stuff like customer development, sales framework, unit economics and the like, and the frameworks for organizing the activities, goals, main constraint, this main bottleneck, hypotheses and weekly sprints. A set of frameworks to organize whatever is known about the current state of the business. As a coach, I will not go to the numbers. I will not go, I would not, I'm not a coach, but as a coach, I would not go to their financial reports. As a tracker, I do that, I look into the numbers, I'm very grounded, and that provides much more value for the founder because I help them actually grow their business and not just figure out what are the limitations in their mindset or whatever the coach is helping them to do.

Alex: Right?

Guest: For a founder, that's not enough. Coaching is not enough for a founder. And so we have this set of tools, methodologies, frameworks, and I teach this set of frameworks for, it's a two month course, very intensive. There's a lot of work to get used to those tools and frameworks so that a consultant or a coach, or the entrepreneurs themselves can do this work of helping the founder or themselves figure out what is the main problem, what hypotheses we will be testing to overcome this problem, and what exactly will we be doing during the next week to test those hypotheses, overcome this constraint and get to the big goal.

Alex: That's what makes sense now, me being entrepreneur and business owner for more than seven years now, and I've also interacted with different level of startups, even with the entrepreneurs who just have an idea. So then you have another category where there is already some product in place and they're just trying to get some traction. Then there is another category that already got the traction and trying to scale. Where do you see tracking, growth tracking being the most useful for what kind of entrepreneurs, what kind of founders on this entrepreneurial journey when you launching new.

Guest: Venture, growth tracking is stage agnostic and sector agnostic. Businesses at different stages use it differently for an early stage startup, for the startup on the idea stage or on the precede stage, the focus will be on stuff like customer development, going to customers, interviewing them, figuring out what the value of the product is. Later on it will be more on scaling and economics and stuff like that later yet it will be how the management system works, how the responsibility areas are organized, delegation and stuff like that. Different stages call for different focus, but still the main framework remains the same. We have to set high goals, ambitious goals. We'll get to it later. Let's not forget, we have to set ambitious goals. We have to find the main constraint and then we have to quickly test hypotheses on how to overcome this main constraint. The constraint will be different, the hypotheses and the frameworks to figure out those hypotheses, to come up with those hypotheses and to set up experiments, those will be different. But the process is the same. And it works for any kind of business. It's not just for it startups. It works in large manufacturing, it works with trade companies. For example, one of the cases, one of the clients I work with myself as a tracker, it's a trading company. And our goal is to go from $100 million per year to $300 million per year in a year. That's what we do. But all the same goes for an early stage startup where our goal will be to get the first sale. I'll compress time for them, they will get there faster. That's it.

Alex: So basically, as a tracker, you give the framework, give the tools, and you keep them accountable by meeting every week and just checking on progress, checking how you are progressing against your objectives.

Guest: Yes. And what I do, as I just said, I compress time. My work is to compress time for that so that their time goes faster, much faster than they thought they could.

Alex: Yeah, that's amazing. Time is the most valuable resource. It could. Tremendous value.

Guest: Yes. And there's more to it, because when I say compressing time, here's one way of thinking about it as an entrepreneur, you always face problems and you can predict some of them. You can do something so that this next problem doesn't hurt you too much. And then you can see even further and see the next one and the next one. Some of them you can get advisors who will show you some problem you don't see. You can get consultants who will help you prevent some of the damage from those problems. But there always be the next one. There always be the one that you don't know about, that you don't see, and you don't have an advisor that will show it to you. And that's how this thing works. There always will be this next one because there are only so much problems that you will work on. And the next one, there's an infinite number of problems. So there will be the next one that you don't know, and that will be a surprise for you. And the only thing you can do is smash your face against this problem earlier, before it becomes so big that it will kill your business. And that's how I speed up the time. I make the entrepreneur smash their face into this next problem a little bit earlier, so that they have spare time to handle it. Just get there faster. That's all you can do. And that's why we need ambitious goals. That's why if they think they can grow like 50% a year, I will talk to them about growing two or three times a year, so that they try to run faster that they are able to, and something breaks earlier than it would break. If they grow 50% per year and they will have a chance to fix it, they will see it and then go all the frameworks that enable this process, a lot of them.

Alex: Now let's make it clear. The process and the framework and the methodology that you are describing, is this something that you came up with or it's well known methodology that's been around for a while and yeah, I'm just trying to separate what you came up personally within the growth tracking net and then the methodology, if I'm right, that's been there already.

Guest: The regular tracking is what I, along with some friends and colleagues who we were working with, that's what we came up with. We created this thing you call regular tracking about ten years ago, and we created this methodology. It was at IIDF, the russian accelerator. That was back then, it was called the russian YC. We had similar structure, similar program, but then we started building this methodology. We had quite a playground, about a few hundred startups per year, 300, something like that, 200, 300 startups per year over the course of many years. That's quite a playground. And we had a chance to create this methodology that we call tracking or growth tracking for the english speaking market. And this methodology, it consists of well known tools like customer development. Not just tools, frameworks and methods, and methodologies and theories like theory of constraints, for example, or agile, or scrum. We didn't invent weekly sprints, we took them from scrum, but unit economics, customer development and many other frameworks, we combined them into a working system. Because any of those tools alone, or, I don't know, Gestalt therapy, which is big part of the way we work with the founder when it comes to the limitations that are not in the business, but back in their head, all of those frameworks or tools or methods, taken separately, they don't provide the result we aim for. But we created a system, and I developed this system even more because what I call now the growth tracking framework goals main constraint hypotheses sprint this framework was created later in my practice, my own practice, with my clients, and that what I actually teach, that's the main part of my teaching of the course of how we think about the business, how we see the business in our interactions with students and clients. So the framework itself, the methodology itself uses many well known tools and frameworks. Then there is the main tracking frameworking framework that I came up with myself, and some other things, like the framework for digging deeper into the limitations, into the constraints, into the bottlenecks in the founder's mind that don't allow them to achieve their business goals, there is a framework for that. I teach that framework. Those are custom, those are mine.

Alex: Nice. That makes sense now. I didn't realize that the tracking came from IDF. Didn't know that. It's interesting, but it all makes sense now. So the growth tracking is a framework over frameworks. And because you know, from your experience, and obviously from the framework itself, you can apply right tools in the right moment and save lots of effort, energy, money, time, whatever, from trying tools that are wrong for solving particular problem.

Guest: That's actually the main problem consultants face, because they have a tool and they have to apply this tool. But that's not the tool that you need to apply right now. You will have to apply it next week or next month or whatever, but before that, you have to fix a different problem. And they don't have, many consultants just don't have this framework to identify this problem, to focus the founder, the client on this problem, and to help them overcome this problem, because they keep their own mind, their own focus in their box, which is defined by their expertise. They don't have expertise in this field where the actual problem right now is, and that's where they fail. And that's the problem with most of the business education, with MBA or stuff like that. They give you the tools, they give you frameworks, and you start applying those tools and frameworks in the order you are given them and not in the order that the actual situation in the business calls for. And that's the problem with many startup accelerators. They have the acceleration program. What is this, like eight weeks or nine weeks or twelve weeks acceleration program. What is this program? It's actually a set of bottlenecks, a set of constraints that are typical for this stage they are working with. They usually focus on a specific stage and they create this program. We will work first on this, then we will work this week on this, this week on that, and the next week on that. And they try to force every startup in their program into this sequence, but their real problem at the moment is elsewhere and it just doesn't work for them. And so they see it as an educational program and not actual help for their business, actual tool for growing their business. And that's where MBA programs, acceleration programs, consultants constantly, consistently fail. And we take those consultants or educators or accelerators and we help them change this behavior. We help them identify the bottlenecks and focus their work and their teaching. And the teams, what the teams do, what the founders do on the bottleneck and then get to the next one. And if at some point you have expertise that might help with the bottleneck, that is now the main problem. You can apply this expertise as a consultant, but only when it is really needed, only when it's time for that expertise and not when you want to apply, right?

Alex: Yeah, that resonates a lot with me personally. Even at the level not of complex things like MBA education or accelerators, even simple things like you get excited with the book, I don't know, an author talks about framework, let's name it, I don't know, jobs to be done, for example. Right? So you get so excited, you jump on it, you are trying to push it, implement it in your business, in solving your problems. But in reality, this is a tool that needs to be applied in a specific way to solve specific problems. And you just feel frustrated at the end of the day, like it doesn't work, it's garbage. But in reality, each problem should have right tool to be applied in the right mount, applied in the right way.

Guest: Even if you apply this new tool, when it's time to apply this tool, it won't work at first. You will have to make extra effort for it to work. They never work at the first try. Nothing works at the first try. You have to try it and try again and try again and eventually it will try. But if it's not really the problem that is the main constraint in the business, you will not have enough motivation to go through those problems to make this extra effort. You will not make this extra effort and as a result it will not work. But if you are motivated to use this one to solve this specific problem, you understand, you realize that this is the main problem in your business, then you will make this extra effort, make this extra step, and it will work because it's a good tool. Jobs to be done works, but it requires this extra mile and then it will work for you.

Alex: Now I'm looking at your website, growthtracking. Net and you're calling it growth tracking school. Let's chat a bit about school component, what the school is about.

Guest: I teach consultants, coaches, investors, entrepreneurs to be growth trackers, to apply this framework to their businesses and other people's businesses. I do it for many years, since 2016, mostly in Russian, but last year we launched in English. We did the first batch in English and I am very grateful for my first american students and canadian students for going through this course, which was a mass of course, but still I have over 1000 alumni. Over 1000 people came through this course. And most people back in Russia, most people who called themselves trackers went through my course. There are other people who also teach tracking, but most of them came through my course. I say, if you were working with a tracker, most probably this person was learning at my girls tracking school. If you came through some program, most probably the person who was teaching you came through my school. That's the source of the methodology. It's a two month course, very intensive. Just started. Current batch just started a couple of days ago. Like, yes, day before yesterday. And we are very excited for this next batch, for those people who are just starting this exciting journey that those two months that they will remember for many years to come. I know that because I know people are remembering this experience for many years. Yeah.

Alex: And their clients will be grateful for having good trackers.

Guest: One member of my team was asking me, what is the reason, the big reason, why are we doing that? Is it just for money or something? And I managed to give her an answer that did actually convince her it was what I am doing is I help people do less bullshit work. And as a result of this work of mine, I know that tens of thousand people, maybe hundred thousand people, did less bullshit work at their workplaces, at their businesses. I don't know, about a million people, probably not yet, but maybe, I don't know. I don't have a way to count this. There's no way you can count how many people did less bullshit work. But I know there's a lot of them. I know lots and lots, thousands and thousands and thousands of people do and continue to do less bullshit work in their lives. And that's why I feel that this is an important thing to do.

Alex: That's impressive. It's a great, I wouldn't afraid to call it lifelong mission. Reduce the amount of bullshit work in the.

Guest: Yes, yes, that's what I do. And then last year, there was this story of a friend of mine, Camila, who came to the school to become a. A, she's a teacher. She teaches English and Spanish, a freelance teacher, language teacher. And she wanted to expand this teaching into a business. She started doing something and she realized she doesn't have enough understanding of how to do that. And since she knew me, she knows me for like over ten years, 15 years, I don't know. She came to my school and she started working with clients. She did sell her services right away during the school to some startup founders. And then when it came to the final days of the program, we had scheduled a call with her to discuss how she will be selling her services. She's in California, and I'm interested in american markets, so we had to discuss that. And she came to this call. But right from the start, she told that she won't be doing this anytime soon, because a couple of days before that, she was diagnosed with cancer, and she had to move all her effort from business and consulting and stuff like that to battle with, to her battle with cancer. And what she did was she applied everything she learned to this work. She had a team helping her figure out the strategies, figure out how to finance this thing. Curing cancer is not a cheap thing in the United States, how to find the best doctors and stuff like that. So she had identified bottlenecks, she said long term goals, short term goals. She said she was testing hypotheses, she was doing sprints. And as a result of that, that's her words, not mine. As a result of that, she came through this preparation stage to her first surgeries are much faster. She's working with the best doctors. She spends much less money that was expected for that. She did her job. And right now, if I am right, she already doesn't have cancer. And that's what was really impressive for me. That's not why this methodology was created.

Alex: Right. So it's useful not only for business applications. You can apply it anywhere for anything.

Guest: You can apply it to. Not yours.

Alex: Yeah, that's impressive.

Guest: Let's hope not.

Alex: I'd like to wrap it up with talking a bit about Lisbon, because it happened that both Eugene and myself are in Lisbon. Eugen is in actual Lisbon. I am in suburbs, and Eugen has been in Lisbon for a bit more than a year. Right. And doing some mentorship in a local startup community. Let's just spend a couple of minutes talking about that. What are your impressions about Lisbon, Portugal, compared to Russian? Maybe startup environment is a bit different, cultural aspects. What are your thoughts?

Guest: Lisbon is very international in this thing. They work quite a lot on bringing in startups, businesses from all around, not only Europe, from the United States, from everywhere. I was talking to some guy from Australia. We had a mentorship call, and at some point we realized that he's an Australian. He just killed a spider because that's Australia. They are working hard on bringing in very many people from all around the world, and they want to become. And they are becoming this international hub. And that's quite exciting. I like that very much. That's it. That's what Lisbon is. And the startups are the same everywhere. It doesn't matter where this startup is from or what market do they go. They all have bottlenecks. They all have to test hypotheses. They all don't want to see where the real problem, it's not about Lisbon. Once again, it's about tracking. It's about founders. The reason the founder doesn't see where the real problem is is at the core of how they become the startup founder. To become a founder, to create a new business, you have to hallucinate a lot. You have to envision something that will not work. You have to create this big hallucination that motivates you, and you have to infect other people around you, your team, your investors, your client, with this hallucination so that they start hallucinating the same way with you. And that what kills the startup. Because as you hallucinate, as you live in this imaginary world of your future success, you don't see what is really going on. You don't see the problems that will not allow you to pursue this dream, to pursue your strategy. And eventually you will smash your face against those problems, and your business will die. So you have to hallucinate, but if you hallucinate, it won't work, but you still have to do that. And that's a very intimate balance. You have to figure out when to face the reality. Not too soon, not too late. And that's where I help them, because that's what's going on within their minds, deep within their neurotic processes. Because without a neurosis, you will not be able to do that. You will not be able to envision your future. You will not be able to invent this thing, because you will actually face the reality right away. You will see that it won't work, and you will move on back to your day job. You have to be in denial, but then at some point, you have to get away. You have to get out of your denial, face the reality, and get back to a different denial. This state of being in denial for a founder is called testing a hypothesis, and that's what we do with pundals, but that requires a very specific work with what happens in their minds. And that's a very interesting, very fascinating, fascinating thing.

Alex: Love it. That's why I enjoy being in startup and founders community so much. Like we're all crazy lunatics.

Guest: Have to.

Alex: Get found up, and we need someone to bring us back to the reality. Otherwise the reality will smash us in the face, and it's better to know about the reality coming.

Guest: Yeah. And that's what I do. I make the reality smash them in their faces earlier than it would do. So if I know.

Alex: All right, Eugene, thank you so much for being a guest. It's been really fascinating, interesting and insightful conversation about growth tracking. Thank you.

Guest: Thank you so much. Thank you for having me. That was great.

Alex: And that was another episode of Curiosity Code podcast. See you next time. Bye.