Business Wealth Without Risk: Power of Relational Capital

0:00Hey everybody, Roland Frazier here, and I'm really excited. Jay Abraham and I wrote a book. Tony Robbins wrote the introduction. Also, Damon John wrote the foreword. Gino Wickman from EOS wrote the preface. It is a very cool book. And to launch it, Jay and I have created a series of video interviews with him and me talking about different chapters. So we wanted to share this with you on social and on our podcast so that you were able to participate and kind of see what was going on behind the scenes. So these are videos and clips where I'm talking with Jay about introducing each chapter or each section of the book.

0:38So you'll hear us talk about the book, but we still wanted to share them here because I think there's some good insights, some good stories and some good takeaways for you. So enjoy and understand that anytime I'm talking about a section of the book or the book, it's because these are the videos that go on the front of each video training related to the book. We just wanted to share the takeaways and kind of the conversational back and forth with Jay and me with you guys. I hope you enjoy it. And now it's going to play. So now we're coming into one of one of my favorite topics of all time. And and I love the way that Jay has titled this relational capital.

1:14So we're going to teach you here a lot about relational capital and it ties in. And I love the order. I mean, it's fair for me to say I love it because it's our book. Right. But the way that this all lays out and how logical the progression is, Jay starts with thinking bigger with moonshots and then gets into thinking better with the mental models. And then how can I optimize that to have less effort, yield greater result? Then how can I apply exponential drivers to grow exponentially? And now we get into something that's so good that it's its own course. It's its own training. And that is relational capital.

1:54Jay, what the heck is relational capital and how can people use it? So it is a word that refers basically to leveraging to your ethical but economic advantage or strategic advantage, the relationships, the access, the credibility, the trust, the belief that other people, organizations, enterprises, influencers, authors, platforms, media companies, have with their audience that you want to be your audience. It entails a multitude of different possibilities, and it's almost infinite. I've used it to grow clients' billions of dollars. I used it to grow my own business. I was talking about, I did a quarter billion dollars, $250 million of seminars using other people's credibility and audience.

2:56I've done it for, let's see, I did it overseas and we used it to grow a candy company that sold in China that became the number one candy company and sold 49 % ownership to Hershey's many years ago when that was a lot of money. I've been doing it a long time. You can do it with organizations. You can do it for introductions. Give you an example is, let's see, I started off running Entrepreneur Magazine years ago and nobody even knew what the word entrepreneur meant. Funny story. We had to send out big envelopes with Webster's dictionaries, phonetic pronunciation and definition because people couldn't even pronounce it.

3:46But this is a true story. The last job I had in 1975 was working for Entrepreneur Magazine. I was making$75 ,000. True story. But I had grown entrepreneur 900 % in literally less than a year. And it was the it was the, you know, the the I was the fair haired child everyone was admiring. And there was a man who was influential in the entire information marketing world. He was the equivalent of the godfather of that. And he knew everybody and everybody knew about me, but they didn't know me. And I got tired of doing it. I stopped wanting to work for anyone. And I wanted to go on my own. Again, I was making$75 ,000, which wasn't bad money back in 75 or 6.

4:34But when I quit, I called him up and he made 25 calls to 25 information marketers who trusted his opinion, his value, and his recommendation implicitly. And he said, this man's either going to go to work for you or your competitor. Pray it's not them. I would get him on the phone, get him a first class ticket and tie him up exclusively for your genre before somebody else does. And true story, because he did that for me, I was earning an annualized two million dollars a month later. That's the power it can mean in the simplest sense. In terms of the, you know, I have created whole business models by using somebody else's distribution.

5:24I have gotten prominent people to recommend and endorse my clients and created multimillion dollar businesses overnight. I have been able to use somebody else's brand. We have a friend who went to Hawaiian Bread and was a King's Hawaiian Bread and wanted to create a chocolate chip cookie. And they didn't have any distribution or any unique. And they went and they said, why don't you put your name on it, put it through your bakery distribution, and we'll give you an option to buy it later on. And they did it and they created something like a$40 million overnight business. It's figuring out who's already got access to the market you want and their trust.

6:10And then it's about figuring out what you have to give them, compensate them, exchange with them or their audience to get them after they do due diligence and realize that you're worthy of it to put the full faith of their trust and their recommendation behind you. I mean, I've got stories. We've got amazing stories about how people have used media endorsements, influential endorsements. We had a company that went from nothing to$70 million just by building an advisory group of prominent people on their board of advisors and using that to put credibility. I mean, I've got more stories of how to use that.

6:56Plus, you can use relational capital to get expertise on a performance basis. If you don't have offices, let me give you a great example. The best example I've got, which is a mind blow, it's a true story. Many years ago, when I used to do my training programs all over the world, I used to go to China when we had good relationships. relationships. And the first year I went, at the end of my very expensive seminar, a young man came to the microphone to ask a question through translation. And his question was, Jay, what do you do if you're too small and the banks won't lend you money to grow? And I said, through translation, tell me more.

7:37It turns out this was hilarious. He said, I'm a small local motorcycle manufacturer. Now, only in China with 100 million population city can you be a local motorcycle manufacturer. He said, if I had the money in the capital, I'd go all over Asia. I would find a place to open a huge factory. I would offer open offices in every country. I would get salespeople, dealers. And I said, OK, well, what's the problem? And he goes, I told you the bank won't lend me money. I said, you don't need money. And then I said, your problem is the solution to somebody else's bigger problem or under realized opportunity.

8:15They may not know it. I said, go on a field trip, go all over Asia, find somebody in a complimentary, not a competitive field who's got a huge factory not being fully utilized, who has offices in a bunch of countries, who has salespeople, dealers, and do a deal with them. That took me literally two minutes, two minutes. A year and a half later, I came back and did another seminar. Sure as heck, young man comes. He's smiling like the Cheshire cat. And he goes, I did what you said, Jay. Now, Roland, you know that I answer questions and solve problems all day long everywhere. I don't remember squat.

8:49I really don't. I'm ADD. I don't remember squat. I said, what did I tell you? He told me. I said, what did you do? He said, I did what you said. I went all over Asia. When I got to Kuala Lumpur in Malaysia, I found Asia's largest lawnmower manufacturer, lawnmower. He said they had a massive factory that was underutilized second ship. They had equipment. They had people. The owner was very entrepreneurial. We made a deal that all I had to do was bring the tools and the dies. And if you don't know what that is, anybody, those are the pieces of metal that are used to form the parts that are assembled to make a motorcycle or a lawnmower or any kind of an item.

9:31And he said, then I had to go to every country and work with the salespeople. And they had salespeople in 10 different countries. And they had thousands, thousands of dealers. And I had to work with them. He said, in our first year, full year together, net net, we both made$15 million for almost no real investment other than raw materials. That's the power of relational capital. I can give you story upon story upon story, because to me, people say, Jay, if we took all of your 97 categories away from you and you only kept one, what would it be? And I said, it's got to be joint venture, power partnering, relationship, relational capital, because that gives you access to an unlimited business checkbook, to millions of dollars of other people's resources for no cost whatsoever, no downside whatsoever, no investment whatsoever.

10:30It is the infinite propellant of explosive stratospheric growth and even greater profitability. So I don't know if that answers your question. How do you mention joint venturing and power partnering? How do they relate to relational capital? Well, if you take relational capital as a tent, okay, under that tent, you have many different ways you can exercise it. So like if you were an artist, you can paint reality, you can paint surreality, modernistic, you can be Andy Warhol type, you know, very Cubist. There's different ways to use it. You have endorsements. You have joint ventures. You have partnerships.

11:17You have co-branding. You have white label. You have referral networks. and a lot of things in between. And they're just different. It depends on the highest and best opportunities that you want to address or you want to monetize that you can't or you don't think you do otherwise because you think you have a capital constraint or a resource constraint. If you don't have offices in other cities, states, countries, parts of the world. I mean, give you an example. You know this about me. Here I am talking to you. I have an interest in five masterminds. I haven't put a penny in. I've changed some.

12:07I had one in Spain. I had one in France. I have 4 ,000 people in Japan. I have had them in Vietnam, and I didn't put a penny up. When I did the seminar business, we did seminars in Australia. We did seminars in Malaysia, Singapore, Vietnam, China, Japan, Italy. I had partners I never put a penny up. I have done vertical. I've done sometimes 650 chiropractors. I partnered with a chiropractic magazine. I've done 400 real estate high-performing agencies. I partnered with a real estate trainer. I have done six or 800 martial arts. I partnered with a martial arts billing agency. So, I mean, you can do an infinite number of things.

13:01I mean, I just could go on and on. I love this category because it gives you such profit power, such possibility power. You can be international. You can be, I mean, whatever you want. I mean, whatever you want. I mean, I've gotten vendors to pay for my clients to develop sales organizations, pay for Facebook in order to get more profit from supplying that that source of business. I've got methods you can't believe, Roland, that they're just waiting for the people who get control of the businesses to unleash. I love that. So now when somebody goes through this training and they are inundated and overwhelmed with relational capital opportunities, is there any framework or thought process or anything that you could give them to guide them to help them get started if they're feeling kind of overwhelmed?

14:04Yeah. I mean, it would be no different than saying to you, you want to improve your body. Well, let's figure what you want and what is the easiest way to get, first of all, what you want, not the hardest. So when you have infinite capability, when we're empowering you with all the profit power you could ever want and you have the freedom to choose, then you start by saying, what is it I want or need or would like to do first, second, third? Because whatever it is in this section, you really do have the guidance to do it. And as I always tell everybody, don't start with necessarily the most difficult or the most lucrative.

14:50Start with the easiest to win, the simplest. The easiest one that you can do almost instantly and then move from there. But, I mean, I think the first thing I learned long ago, optimization. And we talk about a little bit highest and best use. The thing that most people don't do is they just choose something that rocks their boat instead of the best thing to do first, second or third. We lay out a very comprehensive compendium of options, of possibilities, of alternatives, of approaches that are available. And as you study, you will very quickly and directly see which ones apply easiest and best to different situations.

15:40So we're not dealing. I don't think I think the wonderful thing about our book, and I think that's a reason that Tony probably wrote a five page unhedged and really wonderful forward. And Damon John wrote such a wonderful introduction. introduction, Gino Whitman wrote that great preface and Barbara Corkman endorsed it, was that it's not abstract. Different scenario, different types of businesses that you get control of will lend themselves to very specific versions of what we're teaching. So you don't, I mean, it's going to be very self-evident. We're saying you can acquire an infinite number type of businesses.

16:25You're going to decide what you're going to go after. If you own a business now or a company, you might start buying competitive businesses. You might start buying product services people buy before, during, after. You might buy competitive, I mean, alternative, meaning maybe you sell a supplement for weight loss. people that buy supplements don't stay on them very long they buy other supplements then they sometimes buy portion control food like jenny craig then they might go and buy equipment then they might join a gym then they might get a personal trainer or a virtual trainer they might buy a book of recipes you can you can buy all those companies and compete against yourself or You might buy a podcast so that you can be your own advertiser.

17:20And depending on what you decide you want to do first, it will self-regulate and you'll be able to pick the application that serves the best need, goal, or opportunity, Roland. I love it. So you've got to dive into this. You're going to get a tremendous amount out of it. And I think that I think this is probably my favorite of all the things that we talk about. I really like that. And even if you don't feel that you're good at relationships, you can still be good at relational capital because you can ally with people who have relationships. And knowing how these are strung together is to me the most powerful ways to grow.

18:03Let me tell you one more story, and I apologize. This is so cool. So many years ago, many years ago, an insurance company that was called Colonial Pen, they came into being to be a company that was focused on groups, organizations, associations, all kinds of blue collar worker groups. and they were having trouble getting clients. And after two years, one of the most brilliant nonlinear thinkers who was a director said, if we can't get a client, let's become our own. And they started an organization called the American Association of Retired People to have their own client. And they sold billions and billions of insurance policies to unions, instead of unions just to that because they had all these retired people.

19:06No one ever had an organization for us. And literally that transformed them. So you have so many choices when you have this power in your hands. Love it. All right, guys, this is good stuff. Dig in.

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