How to Utilize Relationship Capital to Dominate Your Industry with Jeff Fenster

0:02Who's ready to rock today, Fire Nation? JLD here and welcome to Entrepreneurs on Fire, brought Brought to you by the HubSpot Podcast Network, the audio destination for business professionals with great shows like The Hustle Daily. Today, we'll be breaking down how to utilize relationship capital to dominate your industry. To drop these value bombs, I brought Jeff Fenster into EO Fire Studios. Jeff is an award-winning entrepreneur, best-selling author, an award-winning speaker, and expert in relationship capital. He was named a top 100 entrepreneur in America, top 40 executive under 40 by the Business Journal, and has an acclaimed podcast, The Jeff Fenster Show, which features successful entrepreneurs, celebrities, and athletes sharing their insights and stories of success.

0:45And today, Fire Nation, we'll talk about relationship capital. We'll talk about leading with value, the difference between being interested and interesting, the power of who you know, and so much more. And a big thank you for sponsoring today's episode goes to Jeff and our sponsors. The Gold Digger Podcast, hosted by my good friend, Jenna Kuchar, is brought to you by the HubSpot Podcast Network, the audio destination for business professionals. The Gold Digger Podcast helps you discover your dream career with productivity tips, social strategies, business hacks, inspirational stories, and so much more.

1:18A must-listen episode is one of Jenna's reasons on everything you need to know about affiliate marketing. Listen to Gold Digger wherever you get your podcasts. Belay is passionate about helping your business succeed with their simple, flexible staffing solutions. Download Belay's Bulletproof Budget Template for free, which is the exact budget template they use to grow from a small startup to one of Inc. 5000's fastest growing companies for nine straight years today. Just text FIRE, that's F-I-R-E, to 55123. Jeff, say what's up to Fire Nation and share something that you believe about becoming successful that most people disagree with.

1:59What's up, Fire Nation? So thankful to be here. JLD, you are the man. Love your show. Second time here. And I'm really excited. And the number one thing I hear that are that I believe that most people disagree with with success is that I think success is formulaic, which means everybody can achieve success in whatever they're after, as long as they figure out the formula. And once you figure out the formula, you apply it. It's a model. It's a system just like math. People feel that that's just too simple of an answer, but once they apply the success formula, it works and success leaves clues. So those who have done it in your space or in your industry or in the effort that you're after, you just got to reverse engineer what that formula is, apply it, trust in it, and watch the results come in.

2:42First value bomb dropped Fire Nation. It won't be the last because we'll be talking about how to utilize relationship capital to dominate your industry and who the heck doesn't want to dominate their industry. So I want to start off with the obvious. What the heck is relationship capital? So relationship capital is essentially the currency you have with every single person you come in contact with, whether it's a spouse, a child, a parent, a friend, a neighbor, a client, a customer, a vendor, someone who works for you. People think of relationships as this nebulous interaction. It's not. It's much more similar to a bank account.

3:20I make a deposit or I make a withdrawal or I do nothing. But either way, we all have this unspoken account with each other. And if you understand how to utilize the relationship capital, hopefully you are generating with individuals that you want to do business with or become friends with or you love and care those in your family. you can open unlimited amount of opportunities, doors, leverage, knowledge. You can rise to the top of an industry with zero experience. You can do all the things that those around you will assume is lucky, but it's how you use that relationship capital. And so the moment you can shift your perspective from, I just am friends with JLD and we're buddies, instead of looking at it just like that and realize, no, we have a relationship capital account together.

4:03If every time I call you, John, and I say, hey, I have a favor, I have a favor, I have a favor, I'm doing what's called making withdrawals. It's like going to your bank and spending all your money. But if vice versa, every time we have an interaction, it's how can I help? What can I do for you? Let me connect you with this person. Let me come help you move. Let me come in and use my experience to elevate your business in an area that maybe I add value. I'm making deposits and I've earned the right to ask for favors. I've earned the right for you to be a champion of me. And through that relationship capital is what great connected humans utilize that those who are trying to build don't yet understand.

4:38Fire Nation, if you haven't figured it out already with the intro and with the content so far, Jeff is an absolute stud, crushing it on so many levels. He has been for a long time and he will be for a long time to come. But one thing I want you to understand, Jeff, is that Fire Nation, a lot of my listeners are at the earlier stages of the game. They're getting going. that may be having that first little momentum and traction. Give us an example of you using relationship capital earlier in your journey. I have the best example for everybody, and it's the one that changed my life. So I had a payroll business.

5:16I was 25 years old. I had a little daughter. I was making low six figures in top line revenue at the business, trying to grind my way up. And every week, I would go to the Albertsons, which is a grocery store in my neighborhood. And every week I would see the same checkout people. Well, most people go through interactions with, you know, your day to day life with their heads down, either in their phone or not paying attention. But I make friends with everybody. And so I make cordial conversation with all of them. And the checkout clerk at Albertsons, we got to know each other, not ever outside of Albertsons, but I would see her.

5:49I would say, hey, how are you? I knew she had two dogs. I knew she took him to Dog Beach. So I would always say, hey, how was your weekend? How was Dog Beach? She would tell me. She knew I had a daughter and a payroll business, and that went on for 18 months. But 18 months and a day later, I'm in Albertsons, and she says, hey, Jeff, you own a payroll business. Yes, I do. And she says, my brother is having a payroll issue. Do you mind if I connect you two, and do you mind just helping him out if you can? I said, yes. I'm willing to make a deposit, leave with some value, and help somebody I don't know to do a favor for another person I barely know.

6:21Nope, not thinking anything in it for me. At the time, my biggest client had 57 employees. So I was a small to mid-market payroll business. Well, the gentleman that I helped had over a thousand employees in his company. I was able to find a way to demonstrate my company's ability. He was so grateful for the help. He ended up letting us become his vendor of choice. It was$190 ,000 of recurring revenue a year. It damn near doubled my top line revenue and then opened the door now for me to go to every company under a thousand employees and say, I serve companies bigger than you. I understand the pain points.

6:55And it took me from only being able to serve very small businesses to now serving much larger ones. And that happened overnight as far as the introduction. But it was 18 months of making friends and realizing the power that every single person you come in contact with is somebody's brother, sister, aunt, uncle, cousin, mother, father, friend, and that person can change your life. And so when you realize the power of making good, strong relationships with as many people as you can, it's like fishing with a lot of reels in the water. You're going to get lucky and things are going to fall in your place and you have champions who are willing to help.

7:31And so that was one of the earliest examples of how my relationship capital doubled my business overnight. And I didn't even have to do any selling. I just made cordial conversation in Albertsons with somebody who was just helping me out on a weekly basis. And so that really opened my eyes to say, oh my gosh, what if I do this with every interaction I come in contact with on a daily basis, instead of one out of a million, maybe it becomes 20 out of a million and then it becomes a hundred out of a million and it becomes a hundred out of a thousand. And then today I get inbound stuff all the time from my good relationships because I help as many people as I can, as often as I can.

8:07Fire Nation, what are you doing day-to-day, week-to-week, month-to-month to build your relationship capital? It's a great question to ask yourself. Now, this is similar, but you really believe in leading with value. What does leading with value mean? And again, let's hear an example of that in real life. Sure, and I'll give you one that's even more pressing that's happened just in the last seven months with someone everybody knows. So at this point, I do a lot of business with big names, celebrities, big companies, etc. I'm 20 years into this mission. But what it means is when I come in contact with somebody that I never met before at Albertsons or it's somebody like Gary Vaynerchuk, most people love to.

8:50The first thing they want to do is talk about their business, their expertise and what they can do. Instead, ask questions. So when I come in contact with whether it's Gary Vaynerchuk or the checkout clerk at Albertsons, I want to get to know them. And for people who you assume are successful that you're looking up to and wanting to incorporate into your world, ask them a question that is going to give you an opportunity to see if you have any solutions for one of their biggest problems. So what would I ask? I would say, hey, Gary, what is the one thing you're working on right now that is most important to you that you haven't yet either solved or that you're planning on solving?

9:25and what is standing in the way of that? That simple question changes the paradigm from me talking about my business Everble or WeBuild or my books or my shows or whatever it is. And it gets him talking or her talking about what's most important to them. And I did do that with Gary. And I said, Gary, what is that one thing? And you know what he told me? VFriends. He's launching VFriends. He has these toys that he's putting into toy machines and he wants to get them spread across the country in retail outlets. And what's standing in the way? He's yet to find a national chain that will put these toy machines in the stores.

10:00Guess what? I have a chain of restaurants. I have them across the country in 20 states. I have 80 open stores. I'll have 100 by year end. So I said, hey, Gary, I have almost 100 units across the country. I'm happy to put your toys in my stores. And he says, oh, my gosh, are you serious? Of course I am. Dude, that would be amazing. He connected me with his right hand. We now do a partnership. You're going to see them in our stores in Q1 of next year. He's going to do some meetups in Everbull. He's going to come in and do some content and talk about going to get his V friends at Everbull. And now I have Gary Vaynerchuk marketing my brand.

10:33And I did it because I added value to him. If I had started the conversation and said, Gary, Gary, I have 100 stores around the country. Would you mind being a face for me and helping me market my store? He's not going to do it. So all I did was lead with value. I asked him a question and I solved a problem or I helped enable something that was meaningful to him because everybody has something they're working on. whether it's personal or professional. And if you have resources, you can help. And sometimes it's making an introduction to someone else who can help. But either way, it's about asking good questions and saying, what can I do to help somebody on an issue or an area that is important to them?

11:09And by solving problems for others, you make serious deposits in your account. And therefore, they feel indebted to you, even though they're not, but they feel it. And Gary was like, oh, oh my gosh, Jeff, I'll market for you. I was like, phenomenal. Because I would have paid a ton of money for that. But instead, I'm getting that, I'm not paying for it. I'm helping Gary. He's helping me and we're doing a partnership. And now I have the relationship capital with Gary. Fire Nation, I know a lot of you want to hit the stop button right now because you want to go and start building relationship capital.

11:40You want to start leading with value because you're seeing real ways you can do that in your life. But believe me, we have only just begun with the value bombs and we have more coming as soon as we get back from thanking our sponsors. Artificial intelligence is at the top of everyone's newsfeed. So we all know there are plenty of business pros out there benefiting from AI. AI can help you save time, brainstorm ideas and tackle your to-do list. But knowing about it and putting it into practice are two different things. So what's the first step? If you find yourself spending hours each day on content creation, then meet HubSpot's new AI-powered campaign assistant, a totally free-to-use AI tool tailor-made for marketers and business builders who spend hours each day on content creation.

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13:00Every client, every decision, every detail, it's all up to you. But there comes a time when your potential for business growth depends on you letting go and hiring a team who can help. I know, easier said than done. But Belay actually does make it easy. Belay has helped thousands of business owners make the leap to scale their businesses with their simple, flexible staffing solutions. Belay's exceptional virtual assistants and accounting professionals can partner with you to help you grow your business and take control of your time. They have the nation's largest pool of US-based talent ready to work with you from anywhere and scale with you as you grow.

13:32And Belay is passionate about helping your business succeed, so they're offering Fire Nation a free download of their Bulletproof Budget Template. This is the exact budget template that Belay used to grow from a small startup to one of Inc. 5000's fastest growing companies for nine straight years. Text FIRE, that's F-I-R-E, to 55123 to download the Bulletproof Budget Template and streamline your business with Belay today. Jeff, we're back and the value bombs are going to keep raining down because we're going to talk right now about the difference between being interested and interesting. Tell us more.

14:06So this goes back to something we briefly touched on, which is most people want to be interesting. They think they have to show off their knowledge, their domain expertise, their company, who they are and where they're from, how much money they have or how much opportunity. That means you're trying to be interesting. And you know what? Think about any time you've ever been on a date and the person you're on a date with talks about themselves the entire dinner. You leave going, I didn't love that date very much. But you know what? There's something to learn from that. People want to talk about themselves.

14:36So if you really want to create relationship capital with someone and build a meaningful relationship, be interested in them and ask first level questions, second level questions, third level questions, get them talking about themselves, about what's important to them. Same thing we talked about before. By doing that, two things occur. Number one, you're more interested in them than interesting. So you're going to create an enormous amount of opportunities to find holes and areas to plug yourself or your business or your life into. And number two, they're going to leave that interaction loving you because you were a good listener.

15:07You were paying attention and they feel like, oh, my gosh, that person gets me. They understand me. They heard me. And there's so little of that in today's society. No one feels hurt. We talk to each other, but no one leaves feeling like they were understood. You always go, ah, you know, they just don't really understand what I'm doing. They don't really understand where I'm going because we all are thinking about that next moment to interject our opinion, share our story, talk instead of listening. And it's hard if you're not used to it. But once you train this skill, the amount of sales you're going to generate, opportunities, partnerships, abundance, quality friendships, relationship with your children or your spouses or your brothers and sisters, it's going to be overwhelming how much more benefit comes in your life when you switch just that little paradigm and say, am I being interesting or am I being interested?

15:59And if you be interested, the doors fly open. Fire Nation, think about that question that Jeff asked Gary, and then Jeff just shut up, and he let Gary talk. He let Gary share. And then after he listened fully, Jeff said, hey, I may be able to help you. Is this interesting to you of what I can do to help? And now you heard what we talked about before the break. There's a partnership going on. There's really exciting things that are happening, all because Jeff was seriously asking the right questions and then listening. And you believe in the power of who you know. Tell us more about this concept.

16:38Nepotism is real. We all know the example of so-and-so got the job or got the opportunity because they were so-and-so's brother or friend or what happened. My dad went to Harvard. Yes. Yeah. LeBron James' agent was his childhood best friend, which means, you know, I went to law school to be a sports agent. If I wanted to be LeBron's agent, I had zero chance. He hired his best friend growing up who had no experience, but it didn't matter. He had trust. And trust is how we buy things. And trust is how you get all the opportunities. So who you know matters so much more than what you know. Greatest example, when I sold my payroll business and I wanted to start a digital marketing agency, I knew nothing about digital marketing.

17:16But I knew a guy named Pat Flynn. We grew up together. And I reached out to Pat. And I said, Pat, teach me digital marketing. And he laughed. We went to lunch and he said, Jeff, the name of my business is smart passive income. I don't do coaching. I don't do that. You should talk to a guy named Neil Patel. Didn't know who Neil was at the time. This was 2011. And I said, I don't know, Neil. He says, well, I do. I'll make an introduction. Fantastic. I got an introduction to Neil. I realized and I did something fun and unique to get the opportunity with Neil. But ultimately, Neil and I partnered together and I got to utilize Neil Patel's knowledge and domain expertise in digital marketing, my relationship capital and all the businesses I had from my apparel business.

17:56And I was able to take what he does and basically sell it again to all the clients I'd already sold in the past and build a nice seven figure annual business in digital marketing and make a lot of money in the path because of who I knew. I didn't need to become a digital marketer. I didn't need to build my own brand as a digital marketing agency. I got to utilize what's called the bug light concept and leveraging someone of already who already has that domain expertise, Neil, and the brand in the marketplace and utilize it to monetize it for my network. And so who I knew opened an abundance of doors.

18:29You said bug lights. What does that mean? For those of you who have ever seen a bug light, it's usually bright blue. Bugs are attracted to it and they get zapped when they touch the walls. It's not the greatest metaphor, but it's the best example I can share. Neil in this example is the bug light. He attracts customers. When I call it one of my clients that I had sold, that was my payroll client from the past. And I say, hey, Mr. and Mrs. Business Owner, I know you're probably trying to expand your digital marketing presence. You're trying to sell more online. I'm going to bring my partner, Neil Patel, in and we're going to do an analysis and see if we can add value and help.

19:02How does that sound? Well, they don't know. They don't ask Jeff, do you understand anything about digital marketing? They Google Neil's name. They see he's a rock star in the industry. He is the king of it. And so immediately they're attracted. They say, yes, come on in. My job is to be the wall and close the deal or zap the bugs. Again, bad metaphor. in the grotesque nature of it, but it's applicable in business. And so you can see a lot of these examples when you see a figurehead. Shaquille O 'Neal has his restaurant chain, Big Chicken. He's not actually doing the day-to-day, but it's Shaq's Big Chicken.

19:34So people buy franchises and want to come in because it's Shaq's business. And the business is zapping the bugs. He's the bug light. And so who you know, and that's why we want Kim Kardashian to endorse our product, or Michael Jordan, they're the bug light. They're attracting talent or they're attracting opportunity to your business. And then it's on you, the business, to take care of it. And so if you're trying to scale in an industry and you're struggling, if you have the right relationship capital, you can build partnerships with people who can become your bug light. And from there, you can handle and do what you're going to do to make money and build and scale your business around that celebrity or that big name or that big presence or that attractive bug light.

20:14Well, I love that analogy. I grew up on a lake. And so every night we'd be having dinner out on the porch and my dad hung this bug light. It was bright purple. It was like the most purple you could imagine. He hung it out on a tree branch and all during dinner, it would just be bzzz, bzzz. And I just remember as a kid loving that because I'm like, yes, like that bug light is working. It's keeping the bugs away from us and very fond memories. And I think it's a great analogy. And Jeff, I want to end with a bang. Give us the one key takeaway from our entire conversation that you really want to make sure Fire Nation gets.

20:53Then share with us how we can connect with you. Of course, I already talked about your podcast in the intro, but mention that again because people might want more of this great content in that format. And then we'll say goodbye. So I'm going to give you guys actually something that you can all do right now, which will make you stand out in your community and start to allow you to expand on that relationship capital that you're working on. So we all probably have a smartphone. If you put in the contacts of every contact. So if I put my name, Jeff Fenster, and you just write my name, you're not utilizing your phone.

21:25What you should do in the in the notes is put Everbull, We Bill, Jeff Fenster Show, relationship capital is important to him. Gary Vaynerchuk, Shaquille O 'Neal, We Bill, all the things that you're going to learn about me through the conversations you've had and how we met. fan of the Lakers, all the fun things, his spouse's name, two kids, all that stuff. So guess what happens? People make great introductions. You meet these people, you meet the people you want to do business with. And then for the next six months, you're waiting for an opportunity to reach out to them. You're not sure how, and you don't do it.

21:56And you don't really know how to continue to those little touch points. But what I do is I make all these notes. So if I know, you know, John, you just mentioned on a lake bug light. The next time I have a picture of a pretty lake, I can go on my phone and just type pretty lake. If I put pretty lake in the notes next to you, John, I'll see that your contact pop up. I know you like lakes. You used to live on it. I could simply send you a photo when I'm at a lake and say, isn't this a pretty lake? Is this anything like the one you grew up on? Wow. You know what that does? It makes you go, oh my gosh, I haven't talked to Jeff in four months.

22:26He thought about me. He remembers I lived on a lake. It's a contact point. If the Lakers win the championship and someone wants to send me a message because I'm a diehard Laker fan, I can type Lakers in my phone and all my Laker fan friends can get a text message that says, we won! Exclamation, exclamation, exclamation. All my Celtics fans, when we beat them in the finals, are going to get one that says, ha ha ha, we won! Exclamation, exclamation, exclamation. But I'm able to have touch points with a bunch of humans that I might have only met once or twice, and I have a reason to connect with them that isn't about selling my product or my service.

22:56And so I'm cementing our relationship beyond business. We're becoming friends and they're like, wow, he remembers I was a Celtics fan or we're now talking about sports or lakes or spouses or birthdays or hobbies or interests. And those personal touch points make your relationships deeper. So you should use your phone effectively. Every contact that you are building a relationship with, your notes should be full. And that is what I recommend everybody start doing immediately. The results will compound. And Jeff, if Fire Nation wanted to connect more with you, learn more from you, what's the best way for them to do just that?

23:30Instagram at Fenster Jeff, last name, first name, YouTube channel. I do have the Jeff Fenster Show, which is brought to you by entrepreneur.com. That's where my podcast, it's video, audio on all the platforms as well as YouTube. We will wear the whole theme of the show is what I opened with. We try to build that success formula and get it out of successful people so we can give it to our audience. So if you're looking for the formula, I bring on people from all industries that have been successful and we talk about what made them successful. Not the soft skills, but the underlying attributes that are repeatable and scalable.