“People do business with people they like.” – Patrick Tannous, Tiesta Tea Co-Founder and President

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Adam: All right. Ladies and gentlemen welcome to the best team wins podcast. Where we feature entrepreneurs and business leaders whose exceptional approach to the people side of their business, has led to incredible results. My name is Adam Robinson, and for the next 25 minutes I’ll be your host as we explore how to build your business through better hiring.
Patrick: Thank you my friend. Appreciate it Adam. It’s great to be here, man.
Adam: Yeah.
Patrick: And congrats on what you’ve been able to create. Really cool.
Adam: Thank you. So we met … We had a chance to meet four years ago.
Patrick: Yep.
Adam: In a program called the Junto Institute and the growth have experienced is just amazing. So congratulations.
Patrick: Thank you. Thank you. It’s pretty awesome and a lot of it goes to people, and Junto really helps you gear your mind and your company’s mind to understanding people and how to take people to the next level.
Adam: That’s great. Well listen. I look forward to digging in and learning more, but the tradition here on the best team win’s podcast, we always start off on the right foot, and that’s the best news business or personal that’s happened to us in the last seven days. So why don’t you start off? What’s your right foot?
Patrick: You know, I just got back from Australia and I went scuba diving at the Great Barrier Reef. And it was the coolest experience I’ve ever done in my life. It was actually my … I just got certified a couple weeks ago.
Adam: Okay.
Patrick: And my first dive was at the Great Barrier Reef. And my second official dive…
Adam: Yeah. Why not start big?
Patrick: Why not, man? Second official dive we saw a shark just hanging out at the bottom of the ocean. We swam up to him, he ran away and that was one of the coolest things I’ve ever done in my life.
Adam: No one got eaten? You used your certification? Had fun?
Patrick: Oh we were good.
Adam: That’s cool.
Patrick: The shark was scared of us.
Adam: Exactly right.
Patrick: When you’re that low they’re scared because you got all this big bulky equipment and they’re like, the heck is this thing?
Adam: Awesome. Well that’s what you want.
Patrick: Yeah. How about you? What’s your right foot?
Adam: So I … You know what’s interesting? I got … You know, this is kind of a hole in one story but for anyone listening who plays poker … I’m a big poker fanatic and have been for years. I was playing in a game last week …
Patrick: Okay.
Adam: Was on a business trip doing some speaking and had some free time. Played at the … Playing poker at the room at the Jack casino in Cleveland, and I flopped a royal flush.
Patrick: Shut the front door. No you did not.
Adam: A one in 650,000 shot. Flopped a king, ten of clubs …
Patrick: No.
Adam: Royal flush on the board for a ace-high club royal flush. Just awesome. It was like …
Patrick: Yeah you can’t. You got to finish. How’d you play it?
Adam: It’s like hitting a 240 yard par three, three iron hole in one. It was just awesome.
Patrick: What? We know that’s incredible. Tell me you went in all in.
Adam: I kind of freaked out. Honestly kind of freaked out and just made a bet, and the gentlemen on my right who had bet into my hand shoved all in because he had the king-high club flush because he flopped two clubs too. So it worked out really well.
Patrick: That’s nice.
Adam: Worked out really well. So anyway, enough about gambling. But that was my … That was just … That’s pretty cool. That’s a once in a lifetime deal there.
Patrick: That’s awesome.
Adam: We’re here today to talk about the people side of your business.
Patrick: Yes.
Adam: But before we dive in, let’s set the stage. Tell us about Tiesta Tea. Give me your 30 second pitch.
Patrick: We make loose leaf tea understandable, accessible, and affordable to mainstream consumers. So we take high end tea blends, think of a green tea, we mix it with fruits herbs and spices, pineapples, papayas, mangoes, and we take those … We blend them together, package them, and sell them to grocery stores. So you could buy our products in Target, Meyer, Mariano’s, Jewel, Vitamin Shoppe. Pretty much in any city across the country.
Adam: Yeah. And I have to tell you it’s absolutely delicious product.
Patrick: Thank you.
Adam: You guys were kind enough to bring some in today. It’s going to be gone really really quickly. So if listeners want to learn more, what’s the best way to learn more?
Patrick: TiestaTea.com. Go to our website and you can find out all sorts of information about the teas we sell, where you can get them. We actually categorize it by function, so Energizer, Slenderizer, Immunity, Relaxer, Eternity, something for a consumer to fit any time of the day.
Adam: Okay. Very cool. We got the basics out of the way there. Let’s talk about the people side of your business with the time we got here today.
Patrick: It’s so important.
Adam: Do you have specific defined core values for Tiesta Tea?
Patrick: We do. We do. I printed it out. I totally forgot to bring it and I don’t know them all off the top of my head, but we do have core values. And the majority of the core values Adam, it’s not rocket science, it’s just a lot about being a good person. Honesty and integrity always. Respect other people. Never put anyone down. Those are the values. And we have about ten, I don’t know them all off the top of my head, but the core of them is focused off being a good person. Because the bottom line is if you’re a good person, you follow good values, and good things will happen to you. People will trust you. People will want to do business with you, and then you can grow. So the real core, no pun intended … The core of our core values comes down to just being a good person.
Adam: Be a good person. Okay.
Patrick: Yeah. It’s important.
Adam: Well so tell me how the core values and that belief which comes through, right? That passion comes through when you talk about it. How do you reinforce that daily? Talk to us about how that becomes real inside your company, and drives decision making and culture.
Patrick: Sure. I mean, we’re in the process of … I’ll give you real life example. We’re in the process of hiring right now, right? And I’m going across … My team and I are interviewing lots of people. And if you don’t have a conversation with them, and get the feeling that this person is a good person who’s honest and respectful, and has integrity, someone you can trust, then we won’t do business with them. It’s very simple. So it comes down to can you trust the person you’re talking to? And if you can then we’ll take them on to the next step. But if you get that feeling when you’re meeting someone that maybe they’re sneaky or they got something that’s irking you the wrong way, done.
Adam: Okay.
Patrick: That’s it.
Adam: So you stick to it. Talk about how you communicate those values internally. Do you have an example of a story you can relate where somebody took action that was … You know, they made a decision because they thought about a value and said, well this is the way you’ve taught us to do it.
Patrick: Off the top of my head, I think the one that comes to my mind is we’re working on a tea beer right now.
Adam: Okay. Tell me more about that please.
Patrick: It’s a really really cool product. And we’re taking yerba mate and loose leaf tea, and infusing it with beer. And one of the core values is lead when you see an opportunity. And so when you have … When you’re growing quickly as we are, we doubled last year, and it’s very hard to grow and not lose anything.
Adam: Sure.
Patrick: Well one of my colleagues, my marketing colleague …
Adam: You mean culturally. Lose anything culturally.
Patrick: Not just culturally but opportunities that slip.
Adam: Right.
Patrick: And so my marketing colleague saw the opportunity, what we were doing. I didn’t tell her to do anything. I didn’t ask her to create anything. And she went and helped us create the packaging for this beer product. She actually contacted a designer and got it all going. And I didn’t tell her to do that. She saw an opportunity and she led by example. And that … As a boss when your people do things that you want them to do, but you don’t have to tell them.
Adam: Right.
Patrick: It’s a magical thing.
Adam: Yeah. Absolutely. Absolutely. That’s awesome. Thank you for sharing that. So let’s talk about the structure of your leadership team. Walk us through the senior roles in the company. The top level decision makers.
Patrick: Sure.
Adam: Take us on a tour of your leadership table. Who’s sitting there?
Patrick: Sure. So we’ve got three what I’ll call officers …
Adam: Okay.
Patrick: We’ve got our CEO. Dan, our President. which is myself, and then our chief operating officer, Alex.
Adam: Okay. Three co-founders?
Patrick: Well kind of. Dan and I were the two original co-founders. Alex joined us after about, call it six months of being in business.
Adam: Okay. Yep.
Patrick: Helped up pretty much build out the entire infrastructure of the company, but wasn’t one of the original founding members.
Adam: Okay.
Patrick: And so the three of us are kind of the … At the top level. The three of us make the most … The majority of the strategic decisions, hiring decisions, decisions of that sort. Then below us we have what we would like to call our senior level employees. And that’s a operator, another sales guy, and then a marketing colleague.
Adam: Okay.
Patrick: So we’re at the top, then three below us, and then that’s kind of what we call the core six.
Adam: Yep. So about a third of your head count is involved in management of some capacity.
Patrick: Yes.
Adam: Okay.
Patrick: And then below them we’re filling the gaps as we move forward and hiring left and right to fill underneath them.
Adam: Sure. Now talk to us about how you and Dan figured out how you’re splitting CEO, President roles. Walk us through it. It’s just so often co-founders go through that and have to make those choices, so how did you guys decide who was doing what?
Patrick: You know Adam, it’s a great question.
Adam: You know a coin flip is also an acceptable answer because I’ve gotten that plenty of times.
Patrick: A lot of people are surprised when we tell them this, but it was simple. Dan is smarter than I am. He’s a better business man. He’s better with finances. He’s better with the numbers. He knows that stuff way better than I am. So when we started the business we were just at the lawyer’s table, and it was all right how are we going to divide this? Well it’s 50/50, but we gave him an extra voting share and made him the CEO. And that was a decision that I made on the spot without really … I know he’s smarter and better suited to handle the CEO job than I am. But you know what Adam? That’s great because he can do all that stuff, and it frees me up to do the stuff I’m good at. So it wasn’t … It was a no-brainer to give him the title of CEO.
Adam: I got to tell you how much I admire the humility and self-awareness for you to make a call like that.
Patrick: Thank you.
Adam: So many founders they … The easy path is 50/50, joint decisions until that grinds to a screeching halt at the first major obstacle. And so that’s awesome. That’s great.
Patrick: I appreciate that. And now that I think about it, I think that ability to step down gives me … When me and Dan work together, when I stick up for something he’s that much more prone to listen to it because he knows that I’m fighting for what’s right. He takes my … When I need something done, he takes it much more seriously because I didn’t just come in and say I need to be CEO.
Adam: Yeah. For sure. Okay. I love it. So our listeners love to hear about different businesses’ people model. Think of it like the business that governs the people side of your business. And so a couple of examples, are you hiring entry level in training, or utility players, jack-of-all-trades folks that are just highly capable and malleable, or you looking for specialists to … Sniper shot hires to do really specific stuff? Where are you guys at right now?
Patrick: That’s an awesome question Adam, and it’s one that I’m a little bit struggling with. We’re a very young company. Culture, and people is extremely important as I’ve said and our oldest employee is 29 years old.
Adam: Okay.
Patrick: So when you think of that oldest employee being 29 years old, it puts a slight restriction on the age limit of people you can hire. I’m not … I hate to say this, but I’m not sure the legality of even the rights or wrongs of this but it’s hard for us to hire someone who’s over 30.
Adam: Mm-hmm
Patrick: It’s really hard because they come in, they have the experience, they want to tell us what to do, and it breaks up the culture. I don’t believe that it’s … I’m not confident having my 24 or 25 year old marketing director telling some 32 year old marketing associate what to do. That people dynamic is difficult. So as we’re hiring now, we’re growing like crazy, as we’re using the Hireology platform to make …
Adam: All right. There we go. Shameless plug.
Patrick: Hey we’re doing it.
Adam: Ringing the bell.
Patrick: It’s so much easier than doing it the traditional way. And so we’re using the platform right now. And it’s very disheartening. It sucks because when I see someone who’s a little older, it automatically … It makes it difficult for them to fit the mold of our business. So right now I’m looking for more of entry level people who are extremely talented that we can mold. It’s people who are … Did really well in school. Who were very smart. Who have a thirst to learn, and have a thirst to become better. And have a thirst for business.
Adam: Well reading between the lines there, what I’m hearing you say is it’s not necessarily the age that’s the differentiator. The differentiator is the adaptability or openness or willingness to do things different or perhaps learn it a different way.
Patrick: Correct.
Adam: And you know I can imagine the CPG industry, the food business, is not one that’s full of hungry go getter startup types.
Patrick: Yeah.
Adam: It tends to be lifers.
Patrick: They’re flocking over to you here in the tech community.
Adam: Let’s say lifers. Yeah.
Patrick: Yeah.
Adam: So I get it. Yeah. So adaptability is what you’re looking for. Has that model changed over time? Has there been a time you would … You hired big and it worked or didn’t?
Patrick: We’ve never really hired big. You know the most recent hire I made was the first time I ever recruited from a like company. And that hire has been great. We brought someone on from another CPG “better for you” food company.
Adam: Yep.
Patrick: And she was young. Fit the culture of the company. And she’s been an absolute great hire.
Adam: Awesome.
Patrick: But no we haven’t really tried to do that. Adam I don’t know if I believe in that. I don’t believe … You’re talking about a guy who … If anybody … If I were to follow the experience model, I wouldn’t have a job. I started this thing when I was 21 years old.
Adam: Right.
Patrick: And someone gave me money. They didn’t look at my resume and say all right this guy has been in the CPG industry for 20 years I’m going to give him some cash. No. And so I don’t how much…… I believe experience is important. But I don’t believe that’s it’s the driving factor to making someone a very skilled employee.
Adam: All right.
Patrick: That’s the people part.
Adam: That philosophy has clearly worked for you.
Patrick: Thank god, yes it has.
Adam: Okay.
Patrick: A lot of … Another big thing Adam, is people say you can’t do business with your friends. Dan and I were preschool best friends.
Adam: Preschool best friends.
Patrick: Preschool best friends.
Adam: Okay.
Patrick: I was his best man at his wedding last year. Alex, my COO, another one of my best friends. I stood up … I was a groomsmen at his wedding. And people say you can’t have friends and get into business. Well guess what? I am and it’s working out just great. You know why? Because I know so much about these guys that I know what they’re good at, I know what they’re not good at. They know what I’m good at, they know what I’m not good at. So we know which holes to fill together.
Adam: And that builds trust clearly.
Patrick: Yes.
Adam: All right. So let’s get tactical here and talk about comp. So what roles do you have at your company and let’s take the top two or three multiple head count roles, sales, service, whatever. Pick on and let’s dissect it. Let’s talk about the comp plan and how you’re structuring it. Do you have a sales role in the company?
Patrick: I do.
Adam: Okay.
Patrick: I still sell.
Adam: Okay. But does the company hire salespeople?
Patrick: Yes.
Adam: Okay.
Patrick: And we’re in the process of currently hiring a salesperson.
Adam: All right. So tell me about that role.
Patrick: So that role is a… it’s an account manager. Basic account manager position. Their job would be to handle some of our current business. Then also in charge of getting new business.
Adam: Okay. And then tell me how that comp structured from a base and upside standpoint, just in percentage terms.
Patrick: So the … Again this is it’s so not politically correct, but the structure is different based on the person.
Adam: Yeah. Okay.
Patrick: If we find someone who’s got industry experience, you better believe the structure is going to be different. The compensation plan will be different. The base will probably be a lot higher. And if we find someone who I believe is a rock star, can crush in sales, but doesn’t have any of the industry experience it’s going to be a little less.
Adam: Okay.
Patrick: So on the Hireology platform what we’ve put out is 40 grand plus or minus based on experience with commission.
Adam: Yep. Okay.
Patrick: And every employee is a little different. We just brought on a girl and she’s awesome. She’s just a killer employee. And we told her when we hired her, that we wouldn’t be able to do commission until she kind of got started and really started working together. Well she’s doing so well that, and she’s not on commission currently that I don’t know if I want to move her to commission because I want her to keep working with every individual person to help their customers, to help them drive business. But I do want to incentivize her.
Adam: So you’ve got … You’re willing to … Your philosophy is let’s put … Let’s pin the comp plan on the right person depending on how they want to get paid. So somebody with more experience, a little higher need for base, you’re willing to go there.
Patrick: Yes.
Adam: If they can deliver.
Patrick: Absolutely.
Adam: Okay. All right.
Patrick: I mean absolutely.
Adam: So let’s talk about … Pick another role in the organization that you’ve recently hired for.
Patrick: Warehouse laborer was a tough one.
Adam: Okay. All right. So let’s talk about this right. So this is an hourly job.
Patrick: This is an hourly job.
Adam: Okay.
Patrick: Where they’re literally in a warehouse packing tea.
Adam: Packing tea. Okay.
Patrick: Yeah. And it’s really hard to find somebody who wants to do that.
Adam: Why?
Patrick: It’s not the most glamorous job, Adam. It’s not … It’s your repeat, rinse and repeat all day everyday you do the same thing. But it pays. It makes money.
Adam: Right.
Patrick: But it’s not the most glamorous job. And so when you’re a young fast growing company, you’re … It’s hard to find people who are okay with not … Who are okay with not being a part of the action. And are okay with being the …
Adam: Infrastructure.
Patrick: Exactly. The infrastructure.
Adam: But I can imagine if I’m an applicant looking for hourly work in warehousing or distribution, and that’s what I am looking for, why would I pick Tiesta? This is a loaded question. Why am I going to pick you over Amazon? Right? Who’s gobbling up everybody in the … At least in the Chicago and Northern Illinois area to go to their warehouses. I mean, how do you compete … Why you?
Patrick: Because that’s going to be dependent on you. Because here’s why. If you want to work for Amazon, you can go ahead and do that but no one’s going to take notice in what you’re doing, no one’s going to really care about you. If you come to work at Tiesta Tea, I personally will know you. I will personally have a relationship with you and I will personally care about your success. That transparency won’t happen at Amazon. If you want to know exactly what we’re doing at Tiesta Tea, I will tell you. That won’t happen at Amazon. We also obviously, we have the 401K, the health benefits, all that fun stuff. But regardless about that, we’re going to be … And this is another thing Adam that people … I don’t understand. I’m friends with my employees. And a lot of people say don’t be friends with … Friends not … Okay we don’t hang out every weekend, but on a friendly level where I’m talking to them like I’m not their boss, but more of like a colleague.
Adam: Mm-hmm.
Patrick: And that goes miles.
Adam: Mm-hmm.
Patrick: But how do you put that on an application?
Adam: Well you don’t. You have to taste that. You have to experience that in the culture. And so what I’m hearing is a little bit contrarian approach, maybe a little less formality, a little more of a family feel. You really get to know people and invest in those relationships and you’re competing based on familiarity and trust, warm environment and a family type culture. And no one’s going to tell you that that’s the right or wrong way to do it. But it clearly is working for you guys.
Patrick: Yeah. I mean it’s intangible.
Adam: Yeah.
Patrick: It’s really … It’s not something you can put on paper and say that’s why we’re good because we have … And I don’t like to use the word family. I like to use the word team.
Adam: Yep.
Patrick: We’re all a team.
Adam: Okay.
Patrick: And that’s … Being part of a team is awesome, Adam. If you can fill your role and help a team succeed, and you find, and you see the end result and you know what you did to help get to that end result, it’s a great feeling.
Adam: Yeah.
Patrick: And everybody in this world … One of the books I’m reading right now is called How to Win Friends and Influence People.
Adam: Sure. Classic.
Patrick: And one of the most important thing they say about people is, you got to make them feel important. We do that at Tiesta Tea. It’s important for us to make others feel important. Every Friday at 4 PM, we’ve been doing this for about five years, our employees get together at a round table Junto-style and we talk about, for five minutes every employee goes through what they’ve done, highs and lows, and opens up to questions from any other employees if they have any operating questions. The gratification that our employees feel by being able to tell everybody else what they’ve been working on and see the progress, right, because we have it all archived so in January you can see that Joe was working on GMO certification. Well finally his high in April was he finished his GMO certification. And that’s all documented. So he had a progress … Start to finish the entire team got to see him go through the GMO certification. And when he was finished, everybody knew and everybody was excited for him.
Adam: Very cool. Very cool. Well you’re living it out every single day. So let’s talk with the few minutes we have here before we get into the lightning round … Recruiting. What’s your single best source of new candidates?
Patrick: LinkedIn.
Adam: LinkedIn. Okay tell me more.
Patrick: All day. Every day. I am again, because people are so important, I do a lot of head hunting. Going on LinkedIn I have their … They have a search tool and I just search for entry level or one to two years within an organization in similar fields, or not. And I look through them and then believe it or not I’ll actually send them a personal message and say, hey we’re hiring, if you’re interested fill out this link. And it’s a link to Hireology. So it’s going out to LinkedIn and that’s one way. My COO prefers Indeed and Cragislist.
Adam: Okay.
Patrick: That’s kind of what he does. But he’s also hiring for a job that’s … He’s hiring the warehouse laborers. So it’s less of a specific job whereas I’m hiring for a sales manager, marketing, so it’s more specified. So that’s my main tool is LinkedIn.
Adam: Okay.
Patrick: And then my COO is using Craigslist and Indeed.
Adam: Okay. Very good. Sounds like you got a process for that and that’s important. That’s the important thing is that you’re … You know how you’re going to find the people you need.
Patrick: Yeah.
Adam: And it sounds like you guys are on that. All right final question here to boil it all down. Give me a 30 second personal philosophy on the people side of the business. How do you do it?
Patrick: How? More why. It’s … People want to do business with people they like.
Adam: Mm-hmm (affirmative)
Patrick: And you’re not going to do business with someone you don’t like. So when we hire people we don’t want to hire people that you’re not going to like because there’s a good chance you won’t do business with them. Adam, if we had met and you saw me and you didn’t like me would I be …
Adam: You wouldn’t be on this show.
Patrick: Yeah exactly.
Adam: Yeah exactly. Yeah.
Patrick: I don’t know how trivial that is, but it’s …
Adam: Oh it’s everything.
Patrick: It’s everything.
Adam: It is everything.
Patrick: I’ll tell one last story that it was a question, I don’t think we got to it but I developed a relationship with a gentleman in 2011.
Adam: Mm-hmm.
Patrick: And you know relationships are extremely important with people, right? We stayed in touch. We weren’t best friends, but we’d email back and forth, text if we saw something that was relatable. That friendship, after five years in 2016, he made me an introduction to another guy, who made me an introduction to another guy, who made me an introduction to another guy that turned into two and a half million dollars worth of business.
Adam: Wow.
Patrick: You’re talking about relationship from 2011 that just manifested and slowly the trust built up, and in 2016 he made an intro that made us two and half million dollars of business.
Adam: Yeah.
Patrick: That’s people.
Adam: So you’re a believer in the … You’re net worth is equal to your network. That’s …
Patrick: 100%.
Adam: Yeah.
Patrick: I really do believe it.
Adam: I’m surprised. I mean how true that is. All right for the lightning round here I’m going to ask you a couple of quick hit questions. You can give me a one sentence or less answer here. How confident are you feeling the US economy in 2017?
Patrick: Not confident.
Adam: Not confident. Okay. Do you think it’s going to get harder or easier to find the people you need over the next 12 months?
Patrick: Disregarding the economy, I believe it’ll become easier because of the position of our business.
Adam: Okay. Great. And then you mentioned a book. I always like to ask what book are you reading right now? And would you recommend it to your audience?
Patrick: Actually I’m not reading How to Win Friends and Influence People anymore, I’m reading The Best Team Wins now.
Adam: There you go.
Patrick: You know How to Win Friends and Influence People I’ve read it several times and it’s a book that I continually read because I never graduated and graduation, and college degree is pretty much the opposite of what we’re talking about today.
Adam: Mm-hmm.
Patrick: People is not really in college. So How to Win Friends and Influence People is what I would like to call my bible, to dealing with people and to growing myself and growing my business. So I read it all the time and I just got back from Australia so I happened to pop it back in my kindle and reread it. So …
Adam: Yeah. On the 20 hours you had to yourself.
Patrick: 27.
Adam: Oh wow. Okay. Very cool. All right well that’s the final word here. I want to ask before we depart, if you’re going to come back on this show a year from now and report on whether or not knocked out the most important thing next year for you on your plate right now. What’s the most important thing on your plate right now?
Patrick: My investors would say to hit our numbers.
Adam: There we go.
Patrick: But I’m going to tell you it’s hiring the right people.
Adam: Okay.
Patrick: We got burned by a couple people, and the burn … When the negative things that happen, when you get burned by an employee and you lose an employee, you’re talking about three, four, five months worth of other people picking up the slack until you can fill that position. So with us growing as quickly as we are, it’s … And I’m not doing this to suck up, it’s the people man. I can hire the most two important people I’m looking for right now, and they become long term keys to our organization, we will be so much more successful than if I focus on hitting my numbers.
Adam: All right. You have been learning from Patrick Tannous, co-founder and President of Tiesta Tea. Patrick, thank you for being on the program.
Patrick: It’s a pleasure. Thanks Adam.
Adam: Really appreciate it. All right. That’s a wrap for this episode of the best team wins podcast, where we feature entrepreneurs and business leaders whose exceptional approach to the people side of their business has led to incredible results. I’m Adam Robinson author of the book The Best Team Wins, which you can find online at thebestteamwins.com. We will see you next week. That’s a wrap.



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