Tribal Economic Development
Tribal Economic Development highlights best practices for creating, implementing, and sustaining plans that lead to success in Indian Country. The podcast is hosted by Waséyabek, an economic development firm dedicated to creating a sustainable path forward for the Nottawaseppi Huron Band of the Potawatomi.
Tribal Economic Development
Building a High-Performing Team Featuring NClude Capital
Kurt Trevan, Managing Partner at Nclude Capital and a Match-E-Be-Nash-She-Wish Band of Pottawatomi (Gun Lake Tribe) Tribal Member, joins Tribal Economic Development to discuss strategies and tactics you can implement to locate and hire high-performing team members – including executives – at your firm. Topics include the right questions to ask, what red flag responses in interviews look and sound like, and how to prepare compensation packages that are in alignment with your ideal candidates.
Waséyabek is a 100% Tribally-owned holding company that manages the Nottawaseppi Huron Band of the Potawatomi’s non-gaming economic development activities. Follow us on:
Our Website: https://waseyabek.com/
LinkedIn: https://www.linkedin.com/company/waseyabek
Facebook: https://www.facebook.com/Waseyabek
Intro and outro music by Woodland Stream:
Owyn Zapata, Co-Lead Singer
Chinodin Atkinson, Singer
Nolan Austin, Singer
Mon-eé Zapata, Back-Up Singer
O’Felia Zapata, Back-Up Singer
Onyleen Zapata, Back-Up Singer
Tribal Economic Development, a Waséyabek podcast, is recorded and produced at River City Studios in Grand Rapids, Michigan.
Welcome to Tribal Economic Development, a podcast highlighting best practices for creating, implementing, and sustaining plans that lead to success in Indian Country. We are Weseabek, an economic development firm dedicated to creating a sustainable path forward for the Nahuasepi Huron Band of the Potawatomi. In our first seven years of operation, we've grown from zero revenue and three employees to more than$150 million in revenue and a team of more than 650. Along the way, we've learned many valuable lessons. Here, we'll share those lessons with you. And now, our hosts, Deidre Mitchell, Wasebeck President and CEO, and Erica Weiss, Assistant General Counsel.
SPEAKER_03:Hello, and welcome back for a new season of Tribal Economic Development, OSAABEC Podcast. I am Erica Weiss here with my co-host, Deirdre Mitchell, and we are so excited to kick off our 2025 podcast season. We've got a lot of exciting things in store for you. We have
SPEAKER_04:Kurt Trevann with us today and super excited to have you here, Kurt. Thank you for joining us. Yeah. Kurt and I started our economic diversification journey very close to each other within a couple of weeks. Kurt was over at Gunn Lake and has since then done some other things that he's going to tell us about, but welcome.
SPEAKER_01:Yeah, thanks for having me. Are we kicking off the season? Is that what we're doing right now? I'm not sure if that was disclosed to me. That puts a lot of pressure on us. Gotta kick things off right. Yeah, I hope we get us off to a good start. But if you don't have a good year, you can definitely blame me for this. You got
SPEAKER_03:it.
SPEAKER_01:All right. Yeah, I'll just keep it really short because I'm excited to get into the conversation. So yes, as you mentioned, started off at Gelnick Investments as a co-founder and their first CEO. And that was really an amazing experience and got me much closer to Indian country and I think the opportunities, especially in the minority business ecosystem. And I've continued to play in that space as it relates to capital. We all know historically the challenges of accessing capital in minority and diverse ecosystems, including Indian country. We experienced that at Gunn Lake. So I wanted to continue with something meaningful. And since then I've been doing consulting and building out a firm, working primarily with minority-owned businesses, especially in the lower middle market, to help really help connect with capital strategies. There's a lot of private equity dollars in dry powder today. Then there's a lot more minority-owned private equity firms that exist in the marketplace, unfortunately. And there's been a growing need to help their portfolio companies out and work I've been specifically focused is building out go-to-market strategies. that connect with their value proposition and their investment thesis. There's a limited hold period. You have to move quickly and intentionally. I think we'll probably touch on that a little bit today. And also finding there's a need for M&A advisory in the diverse markets, in the lower middle market space that seems to be an often ignored space for a variety of reasons. So I've really been building out a firm there to help bring some impact and also build out a business. And so far, it's been a lot of fun, not without its challenges But I'm hoping some of those experiences will bring
SPEAKER_03:some insights here today. candidates look like. So we will go ahead and just jump right in with question number one. Who is this even targeted for? If we're looking for a leadership team or executive for an EDC, who's going to be interviewing for that position?
SPEAKER_01:I'm happy to just jump right in. Absolutely. Let's do it. Conversations like this can be simple in concept, but very challenging to execute. You have to have somebody to hold accountable. And in Indian country, we have a lot of committees. We have tribal council. We have tribal citizens. But when it comes to your EDC, you have to use some best practices when it comes to business. And it's very challenging to manage by committee, and this is why you hire a CEO. But before you get to a CEO, you need to have a qualified board to know what they're looking for and to represent the interests of the tribe. Once you have those things in place, you need to let the CEO put together their team that's going to execute things. the strategy that's been aligned with the CEO and the board. Again, sounds simple in concept, very challenging to execute. And the more stakeholders that you have, the more challenging it can be. But I can tell you that There are a lot of examples inside and outside of Indian country where this has worked well, when everybody is committed to making it work well.
SPEAKER_04:In our case, the board of directors hires the CEO, and they may lean on subject matter experts. Council may be involved in that as well, but it's really the board's kind of decision to hire and then manage the CEO. And from there on down in the organization, it's the CEO's hires and management of those personnel. In the case of an executive level employee, the board may have input into kind of skill sets or characteristics they would like to see based on where they're at in their development, the company has. But that is really the CEOs to execute because that CEO has to be able to work well with the team to accomplish the goals that have been set for him or her.
SPEAKER_03:Which a lot goes into that besides just what a person or a candidate looks like on a resume, right? It's personality and how that individual is going to work together with the team. And I did want to note really quick, if you're joining us for the first time on our podcast, we at Wasaya Beck adhere to the Harvard business model. And so when we talk about board and CEO level, we follow that model in that we have separated or the tribe has separated politics and business and has an independent board that oversees Wasaya Beck. That may not be true for your tribe. It may be the tribal council that's acting as the board. So in talking about this, we believe whatever that governing body is of your EDC is who should be hiring and evaluating the CEO. And then from there, as Deidre mentioned, that authority flows through the CEO to appoint and hire the rest of their team.
SPEAKER_04:Right. And I say for some pointers to start off, it's important to look at a person's resume and qualifications and education. So many times I hear, well, this person has a PhD from so-and-so, and I'm like, but have they actually done the work? Have they actually built teams? Have they actually managed up, down, and sideways education? in the pursuit of a mission. And all of those things are very, very important.
SPEAKER_01:Yeah. You know, an example, I'll try to use analogies, you know, just to excite things up. And sometimes they'll be on and sometimes they'll be off. So just kick me underneath the table if I have no direction to it. But we all have doctors that we go and see, right? We have specialists that we go and see. But how many times have you gone to see a doctor and you're like, What did you just, you're just, you're not good at this. I need a second or a third opinion. Right. And this often happens when you kind of blindly select a doctor to, or a dentist, I think I hear it more about dentists, that they just don't get me or they don't get my issue, but they're a dentist. They've been through all of this education and licensing, but they don't get it. Like this is, I think, a good example of you need to do more. Then just look at somebody's qualifications or certifications to know if they are qualified. So much of this, and I know we'll get to it, but so much of this as well depends on what are you trying to achieve? What is your strategy? I know with SABIC, amongst Indian country, you're at the top in terms of really being dedicated to your strategy. And not all... talent is going to fit well for that particular strategy. And that's okay. That's not a knock on the person, not a knock on the strategy. It's just, it's a very complex situation.
SPEAKER_04:Yeah. And the case of Wasabek, when we started out, we were essentially a startup. This was the, I was the first full-time CEO and And my background included startups. It included managing companies' long-term growth and also federal contracting and working with tribes. So I was a pretty good fit for a startup in Indian country. But you may be trying to bring a CEO into a company that's well-established. And we're trying to accomplish high growth. And you may have an organization that just says, we just want to maintain. And that's a different mindset. That's a different skill set. And so you want to be thinking about all of those things as you're interviewing.
SPEAKER_01:There's a lot of examples out of Silicon Valley. And we think of Silicon Valley as kind of being the startup, the venture capital of the country. And there's obviously a lot of others. I don't want anybody to be sensitive to me saying Silicon Valley. Each geography or region has their own culture for what seems to work there. But the example from a venture standpoint in that high growth, you have to be high growth if you're going to take venture capital. This is part of the strategy. And in order to do that, you need to accept just some realities and have some trade-offs that not all the rules will be put in place. Not everybody can handle the intensity of the speed, but this is why it's important to have a CEO that you feel confident can handle that. The CEO knows what they need across the company. And when you get to, as I heard in the intro, as many employees as what you have, it needs to go beyond just the CEO. You can't just command and control your way to growth. You need to have a team that understands your vision and execution as well. And that works out. You can go a lot further together than what you can alone, but it definitely takes a special skill set. in order to do so.
SPEAKER_03:So as a CEO, a former CEO and current CEO of Include, obviously you guys are in positions that are hiring then. So let's talk about some questions that help you vet out some of those people that would be an asset to a team and help provide the strategy or lend themselves to the strategy that the tribe has established or the board has established. So when you're interviewing someone, Kurt, what are some of those unspoken attributes that you look for when you're talking to a candidate?
SPEAKER_01:Sure. And so let's bifurcate between kind of frontline employees that may be lower skill or lower pay, less experience versus closer to the executive level.
UNKNOWN:Mm-hmm.
SPEAKER_01:And let's just start closer to the executive level. That person should be thinking about strategy because they know that their answers are only as good or bad as their answers relate to a strategy. And without understanding anything about the company, you really don't know how to answer specific questions. And the other part is when you have a sense for what that strategy is, and hopefully you're getting good questions from the candidate, it's also being able to relate their answers to a process or to a work stream. Metrics are very helpful of understanding what they've done in the past. But just saying I generated...$5 million of revenue or$1 million of revenue at this last company, that doesn't tell you anything. How did that happen? Yeah, you can't just go out and say, I'm going to generate more revenue. There's a whole process and system behind you. And they should be well prepared to be able to speak to that. I
SPEAKER_04:say this in a lot of instances, but everything we do, we do through people. So that CEO has to be willing to talk about the team that helped them generate$5 million in revenue or whatever because nobody does it in a vacuum. And so again, back to that relationship piece, as you're interviewing, really listen to what people are saying or sometimes more importantly, what they're not saying because you need to dig in and ask questions to get to the proof that what they're saying they did, they actually accomplished because you hear, well, I did this and I did that and I did that. When I start hearing a long list, I start thinking, How long did they stay and why didn't they stay? And part of my job as a CEO is to manage all the stakeholders in a way that everybody can get along, see the vision, and all pull in the same direction. That is a huge part of my job or any CEOs or leaders job. And if you can't do that, if you're constantly... And there's those occasions, right, where you say, okay, that group just didn't work out. We didn't have alignment, whatever. But if that's always what you're hearing and every example this person gives, you need to dig into that.
SPEAKER_01:And when it doesn't work out, Deidre, knowing you for a long time now, I think we're similar in the respect of if it didn't work out, thinking through What did I not do well enough? Or what did my team, if somebody else made that decision, not blaming the other person? The other person may have applied and said, I wanted the job, but you or your organization hired the person. How much more objective can you place blame? You made this happen. And if you're not reflective like this, even with what are objectively objective, Very poor hires. If you're not thinking that way, you will continuously be subpar at hiring the right team.
SPEAKER_04:Yeah, and at some point your board's going to say, well, if I don't have a team that's working, I don't have business partners that want to work with us, I don't have whatever, there's a common denominator there, and that's the leader. Right. And... I have not made perfect hires every single time, but then it's a process of working with that person to try to get them to the right place and or exiting them if they're not what the company needs. Because I'm not there to win a popularity contest. I'm there to accomplish the mission that the tribe has given me or my owner has given me.
SPEAKER_01:And exit with grace. And that is the responsibility of both parties. It's always important for me to let people know, I want to be your first letter of recommendation if you ever choose to leave or if we ever have to separate. I want to be that first letter. And there's a way to do that, even with hires that don't work out. Hopefully, it's employees that found a better opportunity for themselves. And hopefully, I've created the culture that people can Talk to me about that. It's not always the case. And I do truly want to be that letter of recommendation. But I'm definitely not going to be the person that is speaking negatively about that employee after they left. And I think that's important, definitely externally, but even internally. This ultimately goes back to... This is my fault, good or bad.
SPEAKER_04:Yeah. And that's, I mean, that's just a great thing as a human, but also considering how small Indian country is, that person that exits might not have been the right fit for this particular situation, but they will show up somewhere else in the ecosystem. And so making enemies is not a good idea. Again, shouldn't keep people if they're not performing, but- There is a way to do it with dignity and respect and to help the other person. Or in the case the CEO isn't performing, the board should be behaving that way also. You are not performing. We've worked with you. This isn't working out. How can we both exit and we need to get a leader that will work?
SPEAKER_03:You bring up a really good point, Deidre, that kind of brings us into our next topic. Indian country is very large but very small, right? And so all of these have been really great tips today. for hiring in general, specifically with an Indian country. Obviously, there are some unique attributes that come with working in Indian country, right? I don't think anybody can work in Indian country without getting involved or being touched by tribal politics in some way, shape or form, right? So how do you evaluate a candidate in the context of a tribal environment?
UNKNOWN:Yeah.
SPEAKER_01:Yeah, listen, I'll jump in because I don't work for a tribe right now, so it's easier for me not to get myself in trouble. You know, there's some personality traits that are extremely important for most positions within a dean country. It's important to be adaptable. And that is not always a good strategic trait, but there are some values or some value traits that are extremely important. That is one. And having some humbleness. to, you know, at the core of who you are, to be able to understand the perspective of another stakeholder that may come from an uninformed decision, which let's be honest, a lot of it does because so much of our day to day, we don't talk about or can't talk about either because of the amount of time it takes or because of confidentiality. And many of our stakeholders don't know all of the sausage making that's behind it. We're focused on making a great sausage. But we still have to hear the stakeholders, especially if they're key stakeholders like tribal citizens. Not everybody can do that. It is hard to test for that. Obviously, someone who comes prepared for an interview shouldn't know that already. If they don't know that, you really have to ask, are they prepared to work in Indian country or not?
SPEAKER_03:And I think it's important too that depending on where your organization is at within its business life cycle, experience in Indian country. I don't want our listeners to think that this means, oh, well, if you want to work in Indian country, you got to get started at Indian country and you're going to stay in Indian country, right? There are many... like I said, depending on where your EDC is at and its business cycle, there are times where you are going to need someone that has more tribal experience than business experience. But as your organization continues to grow, that starts to shift, right? Because now you're working not just within economic development with an Indian country, you are now an economic development company working within tribal and non-tribal business ecosystems,
SPEAKER_01:right? Yes. It becomes very challenging. The competition changes dramatically and this type of experiences and people that you need also change dramatically. Having that awareness is part of your strategy of knowing where you want to go and what type of employee or team that you need to get you there is vital to success.
SPEAKER_04:I think some just really frank, honest conversations because how many times do you run into people and they're like, I'm going to take control of this and I'm going to make you a bazillion dollars, you know, and you're like, Okay, that sounds great. How are you going to do that? But I mean, we had some very honest conversations and continue this day that are... Federal contracting is a great example. We knew we wanted to get into federal contracting, but I talked to the board and to the council and to the membership. I brought in others that were involved in it to say... I hear you. You want to be involved in it. Let's make sure we all understand what that means. So it doesn't mean always agreeing with your board or your council or membership, but trying to be just as factual and respectful of what the desire is and just laying out exactly what that means to the mission, to the strategy, timelines, money involved, all of those things. So there's just really... honest conversations. And that goes back to your CEO being a really key hire that can have those conversations and not be tempted to sweep things under the rug or divert attention away from what it is you're actually doing.
SPEAKER_01:You had mentioned how large Indian country is, but also how small it is. And this is having that small size. And I interpret that as being pretty accessible to reach across the country to different tribes that you have relationships with different EDCs. And the best part about that is for those employees that work with an Indian country, you can often go and test Do they have the traits that you're looking for? If you have the strategy in place, going and finding that talent and screening that talent, you can find pretty quickly in many cases, is this the right fit or is it not? And when they're not the right fit, that doesn't mean, again, that they're a bad employee, that they lack skill sets. But for your strategy, you have as a CEO... You have made commitments to your board based upon the best ability that you have and the best information that you have. And it's still hard given all of that to hit those numbers. And it's just so important to make sure that you do as much screening as what you possibly can. Thank you so much. Do they know how they did it?
SPEAKER_03:Yeah. And there's a lot of different ways to do that. I mean, let's talk a little bit about those different screen, those ways that you can screen candidates. So Deidre, why don't you talk a little bit about how Wasayabek screens a candidate at whatever level they're at?
SPEAKER_04:Yeah, this is a methodology that I learned when I worked for Jacobs Engineering. And we use it today and it just has worked really well for us. And what we do is we divide the interview into three different parts. episodes. We try to do a couple of different days so we're not just seeing them in one setting or one mind frame. But we have three groups of three different people at least and one's going to focus on getting to know this person and ascertaining are they a good cultural fit. One's going to focus on really digging into their technical skill set, history, that kind of thing. And one's going to focus on kind of educating them about Indian country, finding out what they know about Indian country. And then we all come together. So nine people at a minimum come together. And the rule is if one person disagrees and doesn't think that that's the person for the job, we move on. And I had this happen at Jacobs Engineering. We'd been looking for a health and safety officer for a really long time. And we had a candidate and they interviewed and this person knew that I had a health and safety background. So unfortunately, I think they thought they were bonding with me, but they made a comment. It's Alaska. There's a lot of ice there. They're like, yeah, if somebody slipped on the ice, I'd just tell them to get up and get back to work. And I thought, yeah, not the right answer for a safety person. So when it came back, It's so hard to hold off
SPEAKER_01:when you are... are close, you need talent. You're desperate. You're desperate. Or even trying to be opportunistic of having just met somebody. They could be a great fit if we were pursuing X and maybe we should pursue X and it's easy to get into that trap as well. And this is where the discipline comes in to the process. And I do want to make one thing clear. We're talking about some of the challenges of working with Indian country. And I hope that we'll get to it. There's a lot of advantages from working in Indian country as well. And in my experience, I've that the right candidates often know what those benefits are. The values that you're working to promote a sovereign nation, you know, sovereign nations that have been under attack for a very long time. And still today, you know, sovereignty is always under attack and, and really wanting to be a part of that story, part of that success to move a tribe forward and knowing all of the benefits that ultimately flow to tribal citizens in the tribal nation. So, you know, I just wanted to make clear that there's a huge advantage that is what I absolutely loved about it. I also love that about, you know, about the diverse markets that I work in today. It's about, moving forward with purpose and impact. So fortunately, there are a lot of people like that.
SPEAKER_03:I'm glad you brought that up too. So I remember the very first all hands meeting that I attended when I started working at Wasaya Beck. There were a number of new hires that had come on right around the same time, some of which had never worked in Indian country before. And after spending, I think at that point, we were maybe 10 months into the year and 10 months into all of our new employment. And that was kind of one of the resounding things in the room, again, from people who had never worked in Indian country before, the drive and passion knowing that they were working for something more than just the shareholders. pocketbooks, right? They could see the tangible benefits that were being provided from the work that they were doing day in and day out. And that really just helps strengthen the team and the bond of the entire organization. I mean, the number of times we hear subsidiaries talk about even their employees, what it means to them to be part of an organization that is looking out for the next seven generations of a people, right?
SPEAKER_01:Yeah. And I can attest to the audience that with Sandbeck is right there. I mean, every decision that we've talked to Right. why it's, again, so important to hire the right person, not just be opportunistic, why you have to be disciplined. These things also, I think, apply to all businesses, but there's some uniqueness here that makes it extremely important.
SPEAKER_04:Yeah, and those are important conversations because we manage differently thinking of seven generations than we would if we were planning on selling the company in five years. So the consequences of the decisions that we're making today are far-reaching consequences. Thank you so much. have the capacity when you're evaluating somebody to the extent that you can, that they have the capacity to stretch their thinking and think, okay, bottom line, super important. That's why we're here. But there are going to be other decisions that we're going to have to make that will impact that.
SPEAKER_01:There's a whole nother conversation I hope I get invited back for on the capital front, because what you described in private equity terms is an evergreen fund or a permanent capital fund. The time horizons are starting to increase for a unique set of private equity funds, and that changes the way in which they look at talent, make investments, but it also plays into the partner's that find that attractive and employees that find that attractive. And that is really attractive to a certain subset of talent that may shy away from standard private equity or private capital because of those short-term time horizons. There's a difference there that people, they don't like that you know, the 10-year or the seven-year hold period of private equity, you guys bring a different perspective to that that can be extremely attractive.
SPEAKER_04:You know, Erica, you asked about what are some of the kind of techniques for interviewing. And I think, because you had mentioned in a previous conversation about case studies, and I think that's an awesome thing to do in interviewing. And a case study that you present them with might be, which one do you choose? The hard line, you know, bottom dollar, or we've got this other consideration. How do you marry those two together?
SPEAKER_01:Yeah, let me be clear that I personally hate, have always hated completing case studies as part of interviews because it is so challenging, so much pressure on the spot. However. I absolutely love using them to try to identify the right talent. And you can, obviously, it's easy for you to modify your case study to the actual position you're trying to fill. Right, yeah. And having a mix of quantitative and qualitative assessments can be extremely helpful, as well as having somebody complete it that day in office as part of it, as well as a more challenging or longer-term project to take home for two or three days or maybe even a week, depending on what it is. As you're hiring for a higher-level position, having a strategic challenge is and presenting that in a case study. One that gives you some free insight potentially from a diverse point of view. So you get something free from that as well, but also how well do they really understand the challenge? And so I think there's a number of different ways to use that. Being able to see how they solve problems and walk you through that is really, really important. And I'll add on to that as well, Deidre. Another activity in the investment world that is often used is oftentimes green team, red team. And that's essentially to arbitrarily select people on your team to debate different sides of whether to do an investment or not. That doesn't mean they support it or don't support it. It's just that you're selecting sides to debate. And you can do that with somebody who's interviewing with the case study involved. it should be subjective enough that there's some room to have some debate and conversation about a perspective. And being able to take that on, acknowledge that you're taking that on in many cases, I think helps to lower the stress level. But also you can use that with your team behind the scenes, just in closed door meetings without the candidate present to have people argue both sides of it. And when you lay it out, as this is the specific exercise we're doing, it's a little bit easier to get the team to debate because they know that their personal feelings aren't necessarily working into it.
SPEAKER_03:Right. So, Kurt, you mentioned a little bit ago attracting talent, and we would be remiss if we did not talk about compensation when talking about attracting good talent and interviewing. You know, it's It's kind of pointless to go through the entire process if you're not willing to pay a candidate what they're looking for too, right? Or someone with the attributes that you're looking for, if you're not willing to pay them what the market's going to pay them, the whole exercise is pointless, right? So let's talk a little bit about executive compensation.
SPEAKER_01:Yeah, this is absolutely a hard one in tribal enterprises, right? As well as not limited to tribal enterprises. All companies go through this, but it also relates a little bit to family enterprises as well. And it's just hard. You talk about money and it's just always hard. And Deidre, you talked a little bit about the life cycles of businesses you've been involved with. And at a certain size, and if you're just starting out, there's a reality about the budget that for a position that an organization can afford. There's just a reality of that. There's also reality of your strategy, and that also relates to the amount of capital that you have to spend. So this is a very iterative, dynamic problem to solve, which is also why many organizations don't get it right. With an Indian country as well, in my experience, in many cases, lower compensation than what is in the private markets is what's expected. And a lot of that comes from tribal governments. In tribal governments, in that sense, there's a very similar thought to other types of non-tribal governments as well, where they just pay less than the private sector. That's not necessarily good or bad, but there's a reality or a trade-off that you have to acknowledge that if you have a price that you're willing to pay, not much different from a car. If I had$50,000 to pay for a vehicle, I'm not going to the Land Rover dealership. I'm not. And I love... Jeep Grand Cherokees. I don't know today in the post-pandemic world if I could even go there. And so if that's my budget, that's not good or bad, but I just have to be realistic. That's just the reality of the situation. And yes, of course, there's other factors that apply to that situation. There's benefits, there's flexibility. I've utilized paternity leave. as a very attractive feature of our benefit package that has really helped out. But we must not lie to ourselves that compensation Thank you so much. But the better that you can focus on what you want to do, what you want to focus on and how you're going to do it, the better insight you'll have into your budget and what you can afford for your talent.
SPEAKER_04:And I have a car analogy that I use a lot. I've told my board and when we're considering even compensation for executive level employees is, you can't hire the go-kart team and pay the go-kart team and expect them to build you a Maserati. It just doesn't work that way. And like you said, there's realities. Maybe we can't afford. And when I started working for Wisaybeck, I worked way under budget, under market, with the agreement that at a certain point, we would do a market study and then compensation would be brought to market. But there's trade-offs, right? So if you only have a certain amount to... that you can afford. You can hire somebody and say, hey, we'll get you to a certain point at a certain time and if they buy into that, great. Or you can say, maybe we need to lower our expectations. Maybe all we can afford is somebody that can kind of get the organization set up and we know once that happens, we're going to need to hire a different CEO with a different skill set, maybe at a different market price to get us penetrated in the market and producing a profit, whatever it is. Just be realistic, like you said about what the compensation needs to be for what you're getting and match that to your strategy, to your point in time and to the individuals.
SPEAKER_01:Yeah. There's also a lot of other alignment tools and it feels as if Indian country is starting to mature in this respect. And If you are a venture-backed high-growth company, there's a lot of stock options as part of your total compensation that can make things very attractive. If it's a public company, stock grants. And there's ways to obviously align interest with this of ensuring that you are the employees there for the next three to five years for that to fully vest. And That makes things really attractive because the upside is much greater than what you could potentially make in market rate compensation. When I say market rate, I want to stress, I've always viewed the private markets as as the benchmark. I've never looked at tribal EDCs or tribal governments as the benchmark, as the investment activity that I was involved with for Indian Country was competing with the private market, not the tribal market. And so it was important for me to use that as the benchmark. But it is challenging with a lot of family-owned companies and tribal-owned companies to think through alignment through equity. But that does allow for alignment through profit share or some metric tied to profit share that can make things attractive long-term if you can't afford the talent that you seek on day one.
SPEAKER_04:And there's always been, I think, a resistance in Indian country to equity, right? ownership, equity, right? But there are ways to accomplish the same thing without perhaps giving equity. There's phantom equity and different things. So you can still have that same model with the same incentives, like you said, to incentivize an employee or an executive and also keep them there long enough to make a difference. You can get alignment. You have to be willing to listen to your advisors. I highly recommend We recommend getting a compensation consultant outside of Indian country because we hear about, well, so-and-so got paid this or so-and-so got paid that. Well, did they? One, and the other is just because your last CEO got paid that does not mean the next CEO gets paid that. They could be a completely different set of circumstances that requires a different compensation structure.
SPEAKER_01:Yeah, and this is assuming that you're investing off reservation, in my opinion. If you're only investing on reservation, that is in many cases closer to... pure tribal economic development. And your core competition is really just yourself. And you often have a captive market. It's not exclusively for profit making or more of it is skewing towards a social good. I know in my experience, I know your experience, you're investing off reservation and having to compete with many really national private equity family office investors because their capital can be deployed anywhere. anyplace. It makes it very, very difficult.
SPEAKER_04:Yeah, it is. And keep in mind when you get that recommendation for compensation, it's probably going to be a shock to most. It's going to be a shock. But also keep in mind that their incentives should be structured that if they aren't doing well, they don't get that. So if they're doing well, you should be happy to pay whatever that rate is. And there's a consequence if they aren't doing well. You're not gonna just pay out all this money for somebody who's not doing well and not meeting their targets.
SPEAKER_01:Yeah, for the audience that have stuck with me for this long, and I apologize, I doubt there's many of them because I'm not very interesting to listen to this long. But for those, let me give you just a practical action step on this topic. Go and just Google family office investing at top banks. And you'll find reports from UPS and Morgan Stanley, and they work with compensation experts for family offices. There's a lot of similarities, and we study this quite extensively, family offices and family enterprise governance. And I am now a self-proclaimed geek on family enterprise governance. I would love to talk about this on another session if you have me
SPEAKER_02:back.
SPEAKER_01:But there are many compensation experts that specialize in this type. And family offices have a value set as well. There's also some challenge is hiring them because there's unique aspects about that, just like there's a unique aspect about Indian country. But there's a lot of compensation examples and structures that happen there that are well-published and documented by third-party independent advisors.
SPEAKER_03:Yeah. I would say there's a reason why people have made careers out of compensation analyses. And so, well, like Kurt said, it is Tough conversations to have. Experts help you bring in those facts to support whatever it is you ultimately decide to pay your executive. And as Deidre said, those outside firms are providing recommendations. It's not the end-all be-all by any means. And however you structure your compensation package should be geared towards and in light of your strategy and what attributes you're trying to incentivize your CEO or your leadership team to really strive for. in the leadership of your organization.
SPEAKER_01:You know, if you show me how somebody is incentivized, I can tell you what they're focused on. Exactly. And so if those incentives are in creating value or generating positive cash flow or whatever that metric is that is important to the ownership group, Make sure that that is how they're incentivized. And there's a lot of structures here. A consultant will help. Family offices, in my experience, have the best experience when it comes to investing in economic development in Indian country when you are off reservation.
SPEAKER_04:And I would just follow up by saying, once you do that, once you agree, make sure you've got an employment agreement and you've got all of that in writing and agreed upon so everybody's clear going forward. No napkin deals. No promises.
SPEAKER_03:Well, Kurt, thank you so much for joining us on our episode one of season two here in 2025, kicking us off great. We appreciate you joining us. And thank you to our listeners for joining us today as well. If you enjoyed this episode of Tribal Economic Development, please make sure to leave a five-star review for us on Apple Podcasts, Spotify, or wherever else you're listening to your podcasts. Additionally, if you have any questions for us or a topic that you may be interested in to hear in future episodes, please visit wasayaback.com slash podcasts and leave us a comment using our feedback form. We'd love to hear from you. Until next time.
SPEAKER_01:Thank you so much.
SPEAKER_04:Thanks, Kurt. It's always great to catch up with you. Always interested and just ready to hear what you're doing next. So really appreciate that. And I want to give a shout out to River City Studios, which is where we're recording from today and have been for a while. They just do an awesome job. And so I just wanted to say thank you to them and we'll be back.
SPEAKER_01:Absolutely. Well, I don't know if I'll be back, but I hope that you'll have me back at some point.
SPEAKER_04:Thank you so much.
