Recently, I had the great opportunity to interview Michael Bor, CEO and one of three co-founders of CarLotz. Frustrated with the used-car selling and buying experience, Bor, along with fellow Harvard MBA grads Will Boland and Aaron Montgomery, founded CarLotz in 2011. CarLotz is a used-car consignment company with non-commissioned salespeople. They are now disrupting the used car industry in three states and recently received $30 million in private equity to continue their nationwide rollout.
I interviewed Bor because I heard him speak to the Richmond, VA Encoreprenuer group. He said that he and his two partners “really trust each other” and that this level of trust provides great latitude in each being able to successfully do what they do best. My interview was dedicated to understanding more about their partner trust.
Interestingly, at the beginning, Bor, Boland and Montgomery didn’t know each other well. So, how did they come to place absolute trust in each other to make solo decisions that impact their own investments?
Early on, we established norms of open and direct feedback, no matter how difficult to hear.
Bor shared that he had a huge growth moment during their first days when Montgomery told Bor he was redlining others’ comments versus “assuming good intent.” Montgomery was reminding Bor how important trust is for improvement feedback.
When they opened their first store, they spent considerable time role-playing the sales experience with friends and family. The practice – and ensuing feedback – became so valuable to their business model, it’s a part of every new employee training.
Even if our new associates have experience in this industry, they may not have consignment experience. The role-playing often makes them uncomfortable initially…but we believe it leads to a significant improvement in service.
Trust Equals Confidence
Once the partners understood and agreed on what their strengths were (Boland heads up finance and marketing, Montgomery handles operations and human resources, and Bor is responsible for growth and commercial accounts), they set each other free to make smart decisions. Bor says they have “respect for each other’s expertise and maturity.”
Regularly, they lay out their challenges and proposed solutions to the others, talk briefly to gather feedback, and then have the confidence in themselves and each other that allows them to act. And, neatly, if there is ever a disagreement, three partners means there is always a tie-breaker and they aren’t stalled by debate.
I see many other partner groups struggle constantly – this CarLotz partner model of both self-confidence and confidence in each other is a trust model that works.