The Simple Checklist You Can Use to Grow Your Business with Donald Miller: An EOFire Classic from 2021

0:01Light that spark fire nation JLD here and welcome to entrepreneurs on fire brought to you by the HubSpot Podcast Network, the audio destination for business professionals with great shows like Sales Evangelist. Today, we're pulling a classic episode from the archives, and we'll be breaking down the simple checklist you can use to grow your business. To drop these value bombs, I brought Don Miller into EO Fire Studios. Don is an American author, public speaker, and business owner. He's the CEO of StoryBrand, a marketing company, and he's also the author of a book called Marketing Made Simple. And today at Fire Nation, we'll talk about a formula for creating a mission statement and how wealthy people think that the company exists to make money so they can buy something that makes more money without working and so much more.

0:45And the big thing for sponsoring today's episode goes to Don and our sponsors. Marketing Made Simple, hosted by my friend, Dr. JJ Peterson, is brought to you by the HubSpot Podcast Network, the audio destination for business professionals. Marketing Made Simple brings you practical tips to make your marketing easy and more importantly, make it work. A recent episode on whether vulnerability is a superpower in business is a must listen. Listen to Marketing Made Simple wherever you get your podcasts. Ever thought about giving a TEDx talk? It's one of the most powerful ways to share your message with the world.

1:17And four-time TEDx speaker Taylor Conroy from Thought Leader can help you get there. Visit thought-leader.com slash fire to join Taylor's free training where he teaches you how to land a TEDx talk and spread your message to millions. Don, say what's up to Fire Nation and share something that you believe about becoming successful that most people disagree with. Well, it's good to be with you guys. I think that most people would disagree with something I foundationally believe, John, and it's that an enormous driver of individual success is actually unhealth. It's psychological unhealth. For instance, needing strangers to applaud for you would be a driver of success.

2:06A desire to prove that you are not white trash. That's a big one for me because I grew up standing in a welfare line. And the healthier I get, the less driven I become. Now, that isn't to say there aren't also healthy motives. I believe I'm a strong believer in mixed motives. So I want to help people and I also want to prove to myself and to others that I'm capable of being successful. So I would say mixed motives as a driver of success are actually – I firmly believe that those can be drivers of success. In fact, recently I watched a documentary about people who had near-death experiences. That is, they died.

2:48One woman was underwater for 19 minutes. What? Yeah, 19 minutes and she went to a spirit world or whatever. Sure. There's a University of Virginia. There's a professor at the University of Virginia who's sat with more than 10 ,000 people who've had near-death experiences. And they go to some place. They're all eerily similar. And they experience this freedom from their own baggage. And they don't – none of them wanted to come back, but somebody told them you got to go back, and they went back. And every one of them, according to this doctor at the University of Virginia, said they struggled with motivation.

3:24They struggled with competition and the desire to succeed. And to me, that's that says something. That's amazing. Even if there's no afterlife, right? Even if you don't believe in it, the fact that you realize you were being driven and it just wasn't necessary and it was causing you to not enjoy life as much says something to me. So I think I think the desire to succeed is a mixed bag. I am 100 percent into it. I get up early every morning. I I organize my time. but there's part of me that wonders, you know, if I were, and I'm not unhealthy. My wife, I'm not a workaholic. My wife and I have a great relationship.

3:59I have good friendships, but I do wonder if it weren't for the fact that I grew up in poverty, standing in line for government cheese and having a crush on the homecoming queen who would never possibly go out with me if I weren't so driven to prove myself. Fire Nation, this is why you consume content from Don because he says it like it is. Very few people in this world will tell it straight like this. And that's why I love when I hear words coming out of your mouth, Don. Quick question before we move on. Have you ever read the book, The Pleasure Trap by Alan Goldhammer? No, I haven't, but that sounds actually really good.

4:37You need to. Listen, from what you were just saying, you would find the book fascinating. It's unlocked some of the very things that you were talking about in my mind. And I'm like, Oh, that's what drives us. Oh, go down that path, my man. The Pleasure Trap. By Alan Goldhammer. And hit me up with email. I want to know your thoughts on it. It's super, super valuable. And Fire Nation, today, as I mentioned, we're talking about the simple checklist that you can use to grow your business. And who doesn't want a simple checklist to grow your business? And I want to start off in a different direction and talk about airplanes.

5:10why the heck should we think about our business as an airplane you know it's so funny i just filmed a course called how to grow a business and i filmed it uh in front of a green screen but what the audience will see is a triple seven out you know with with my my company logo on it business made simple and i realized that as i went through the whole thing i realized one of my main points is keep overhead low. And I'm sitting in front of a$700 million triple seven. So, uh, only your audience will know that I indeed kept my overhead very low because all it is, is a big green carpet behind me. But, uh, that said, you know, I, it helped me.

5:51I was a memoirist before I started a business, had no business training whatsoever. And there was a single analogy, a single metaphor, if you will, that I used when I first started my business that has allowed me to go to about $20 million in total revenue in five years with a 64 % profit margin, no venture capital, no private equity, and no loans from banks, no partners. And that was the metaphor of the airplane. I just kept thinking of my business like an airplane. So let me go through it real quick. You have the cockpit and that's the leadership. So that's the guiding principles. That's your mission statement.

6:27That's where are we going? Where are we taking this thing? You have the wings of the airplane. Those are your products and services. It's whatever you sell, whatever you decide to sell. The wings need to be strong and light. And that translates into in demand and profitable. If you have a product that is not in demand, you're going to fail. If you have a product that is not profitable, you're going to fail. The body of the airplane is your overhead. So that's your rent, your mortgage on your building, whatever that is, the Coke and the coke machine the flickering light bulb above the coke machine you're a lot of your salaries i would consider overhead that's overhead you want to keep that small because if you have giant overhead it's the plane's going to crash the body of the plane is too big in fact we've all been on airplanes probably a small airplane where they come out and say look one of you got is one of you got to get off you know whoever's fattest get off this plane that's what kind of thing and we're taking your bag with you uh and so we've all you know because it matters right they actually weighing the plane.

7:24Then you got the right engine, which is your marketing engine. The sales engine is your left engine. Those two engines have to create enough thrust to get the product off the ground and lift the overhead with it. And then you have the all important fuel tank, which is where your cash is. Because if you run out of cash, your plane is going to crash. And so if you can manage where are we taking this thing? What products are we creating? how heavy is our overhead? Is our right engine marketing working well? Is our left engine sales working well? And do we have enough bank money in the bank account to keep this thing in the air?

8:02If you always build your business in proportion, it's going to do okay. If you were at an airport and you walked up to a plane and had a giant body, tiny little puny wings made out of paper, little rubber band engines and gas spewing out the back, you would intuitively know not to get on that plane. And yet we don't have that kind, they don't teach that kind of common sense in business school. And a lot of people listening to this interview, they've got a really beautiful office. They're paying people way too much money. Their product isn't very profitable, but their business looks really successful.

8:39And the reason it looks successful is because venture capital. Somebody else is paying for all that stuff. Your customers are not. And if you just go back and say, look, we're going to turn this thing into an incredibly efficient airplane. We're going to lower our overhead, ramp up our marketing engine, ramp up our sales engine. The cockpit is going to reverse engineer a specific destination. And we're going to save up six to eight months of money in our bank account so that overhead is covered in case we need to circle the airport for six months until we land. We won't crash and burn this thing.

9:12When I understood, and each of those, of course, has a checklist. The leadership has a checklist. The right engine marketing has a checklist. Left engine sales has a checklist. And that's what I've created, this checklist to make sure your airplane is built flight worthy. Common sense is not common practice, Fire Nation. Something key to think about as we continue talking through this conversation, this simple checklist that you can use to grow your business. Now, some people, Don, they rave about mission statements. Some people hate mission statements. What do you think about creating a mission statement for your business?

9:48I think most of them are ridiculous. They're worthless. Here's what they lack. They lack a statement and they lack a mission.

9:58You ever notice that? We will increase shareholder value with sustainable practices that lawyers wrote that. Clearly lawyers wrote that. And, you know, I was in a C-suite once with a group of executives and I was talking about a formula that I'll share with your audience for a mission statement that is full proof. It will impassion everybody working for you. But I said, you know, I said, you know, I like this formula. He said, well, we spent 48 hours at a retreat. We sweat blood over our mission statement. In fact, it's painted on the wall outside of this conference room and it guides this whole company.

10:34So we don't need help on that, Don. We've done that. And I turned to the CFO and I said, were you on that retreat? Were you on the 48-hour retreat? The CFO said, yes, I was. I said, what's the mission statement? And he couldn't remember. I said, how can you not remember? It's painted on the wall outside of this room. Most mission statements are not memorable. Let me give you a formula for one. and we use it. It's, we will accomplish X by X because of X. That's it. We will accomplish X by X because of X. So here's mine at Business Made Simple. It's this. We will have 250 ,000 people in our online platform, 5 ,000 certified business coaches, and 2 ,500 certified marketing guides by 2025 because everybody deserves the help they need growing a business.

11:26It's so specific, And the reason it's so specific is because everybody has to defend their job against our mission statement. So if I go to our events coordinator and say, tell me what you're working on, they would say, well, we're sending out these VIP packages to Instagram influencers because we want them to talk about it so that more people will join our platform and we'll get to that 250 ,000 number. In other words, anything that you're working on that does not benefit the mission of the organization, stop working on it. Don't do it. And maybe we'll go back and change our mission statement.

11:58But don't do it. What that does is creates a very lean airplane so that there's not all this waste and overhead of people working on things they don't need to work on. The other thing is we put a timeline on it. We're going to do all this before 2025 because we know in story structure, a deadline increases the urgency of the story. So a mission has a deadline. We're going to attack this country and take down the dictator by this time. So that's a mission. But if you just say, our mission is not to like such and such country because they're just not very democratic. Nobody knows what to do. That's not a mission.

12:36It has to be specific. And you say, well, Don, your mission statement is really boring. You know what? People remember it. They can recite it. They filter their job description through it. everybody in my organization knows the three tactical priorities of this organization you find me an organization or you walk in and say what are the main three priorities of this entire organization they'll say well excellence safety oh give me a break come on if you if you're not safe and don't do excellent work get out i i need to know what are you supposed to be working on what's the goal right a football team you go into you go to an nfl football team see what's the goal Everyone is going to say win the Super Bowl.

13:14It's not like play excellent football. The goal is to win the football game. So I think corporations' mission statements aren't very good. And the other thing is, if you're a nonprofit, that mission statement attracts donors. It attracts resources because it's a mission. You know, we will, my wife is chairman of the board for an anti-human trafficking organization. So we will free over 100 ,000 women caught up in sex trafficking by the end of the year. And we will throw this many people in jail because no woman should be a slave to anybody else. You just go, where do I, can you get my checkbook?

13:54Honey, get the checkbook. We're writing a check to this. But if we just say, look, we believe that everybody deserves to be free. It's just not specific enough for people to get their heads around. Mission statements, lack of mission and a statement. Fire Nation, you know it's true. It's across the board. Don't fall into that category. And if you think Don's even close to dropping value bombs, you get another think coming. We're going to be talking about step-by-step processes and creating profitable products. when we get back from thanking our sponsors. Are you ready to start your year off with increased revenue, faster growth, and record-breaking performance?

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17:30I'm all about profits. I've been publishing an income report for 91 months in a row, which by the way, also publishes our net profit percentage to our gross revenue. So I love that you know those numbers as well. What is the step-by-step process that we can use to create profitable products? Well, even before we create a profitable product, I think you need to do a product inventory or a product audit. So this was really eye-opening in my company. We sat down, we listed all of our products that we sell, and then we turned around, we listed them in order of profitability. So that was really eye-opening because some of the things that we were spending the most bandwidth on, the most energy on trying to grow, we're actually not very profitable.

18:15And what we came up with was there's really six things that we need to focus on. And that is Business Made Simple, my online platform. We need to focus on that and renewals because it's an annual fee. So two there. Then we certify coaches who go into companies all over the world and help them understand our processes. We need to focus on growing that program and their renewals. And then we have story brand marketing guides, and we need to focus on getting more guides and renewing those guides. So each one has a renewable fee associated with it annually. And what that did was it decreased. This is what's amazing.

18:57It decreased the amount of work we were doing as a team when we focused on three products with three subproducts underneath those products. Six things is all we sell as an organization. So we let go of all sorts of livecasts that were one-off that, you know, we'd make$800 ,000 on a livecast. We're not doing that anymore because we say, the long-term plan are these three things plus their renewals. And we believe that over time, that's going to pay massive dividends because we don't want to be known for 23 or 25 things. We want to be known for three things because it's easier to be known when you only are carrying three things with you than if you show people 25 things.

19:39So that's the first part is just auditing your existing products and getting rid of dead weight. You want to throw baggage out the back door of that airplane so it's lighter, consumes less fuel, the marketing doesn't have to work as hard. Or if marketing sales is working hard, the plane goes faster and farther because there's less weight. So that's the first thing. Then the second thing is as you create new products, there are a couple of questions to ask. How profitable is this for real? And there's all sorts of questions. Are we going to have to hire staff? What's the research and development fee?

20:13What's the run-up? Do we have – how much is this going to cost us to create? All of those kinds of questions are the questions that you're asking. But here's one that very few people ask. Is this going to confuse our audience? You know, we're known for making this. If we add this, will people get confused about what problem we solve in the marketplace? That's a question that very few people ask. And so, you know, you do an audit on existing products and then you also run any product idea through a filter before you create it. I've got a, there's a book I wrote called Business Made Simple and it's 60 daily videos and 60 daily entries.

20:55You almost read it like a devotional. And I spent an entire week just talking about the auditing process for new product creation. Product audits dump the dead weight. And then I also love how you talked about, is adding this product going to add confusion to our business or is it going to add to what we're creating right here? And frankly, I needed that book. I needed that knowledge a number of years ago when I launched an incredibly successful journal called the Freedom Journal. And in 33 days, it did$453 ,000 on a Kickstarter for a$39 journal. Like it hit the spot. Yeah, crushed it. But then brother, I made the mistake a year later to launch another journal.

21:37And now what did I do? Like now people are like, well, John, do I buy the Freedom Journal or do I buy the Mastery Journal? Like do they work together? And then I was like, oh my God, people are actually asking me this question, but a lot of people are just not buying either because nobody wants to think. They just want, oh, this is John's journal. Let's buy it. Let's go. Let's go home. But now there's like, what do I do? I'm confused. And then they don't do anything. They take inaction. So it's all about like, what is that product ascension model? So like knowing that, Don, and let's not go deep into this because this isn't the point, but like what would be an example of something that, you know, you would create as a product instead of creating something that would be confusing as a potential competitor and cannibalizing your own initial product would actually be a benefit and help that product.

22:20We have an online platform called Business Made Simple. So we have a bunch of courses on negotiation, on management execution, on sales, on mission statement guiding principle, on marketing, on messaging, everything you need to know to grow a business. So my team and I know that when COVID hit, we did a Donald Miller teaches writing live stream. We made about$800 ,000 off that. we come back this year and we're going you know we're coming up on march last year we got an extra eight hundred thousand dollars when we did that live stream do we want to do it again but you know what john it's not one of our three tactical priorities our three tactical priorities are online membership to our platform coaching and marketing guides those are the three things we sell so what we did was we said you know we're going to give up the 800 grand but we're going to do the donald miller teaches writing but so we don't confuse people about what we do, we're actually going to do it for free if you are a member of the platform.

23:19So we've turned it to sell membership to one of our tactical priorities as a bonus. Now, that's going to cost us probably, my guess is about$250 ,000 we're going to lose. But just hear me out. It is worth it to not confuse the audience about what we want them to do. because in the long run, 10 years from now, we want a million people in that platform. And if I keep going, well, you know, I want a million people on my platform, but I want to run over here and get 50 grand here. And I want to go over here and get 75 grand. You are never going to get to a million people in your platform. It's a long form play.

23:54So those are the sort of decisions that we're always making. You know, we're always asking, we're checking it against our mission. it does donald miller teaches writing does that help the online platform it doesn't well how can we make it help the online platform you know what make it an exclusive for people who are in the online platform it's free for them and that's how we justify that and those are the that's how we make those decisions so be willing fire nation to take the path of delayed gratification which is a lot easier to do when you're clear about the actual path you're on now don you're a busy guy I'm a busy guy.

24:29I want to get to talking about your book, Marketing Made Simple, in a second here. So let's move kind of quickly through this last point I want you to talk about, because I think this is really important to kind of bring a lot of what we've talked about home, which is cash flow, because that's the lifeline for most businesses. So share with my audience, Fire Nation, how we can actually manage our cash flow to set up our businesses for profitable and sustainable growth. Okay. So go grab a piece of paper, pause the podcast, grab a pen, get a whiteboard, whatever you got to do. But here's how I manage cashflow.

25:04And I managed it from a quarter million a year to 16 and a half million a year. And I'll use this same system all the way to a hundred million. It's basically five checking accounts. The first account is your operating expense account. We're all familiar with that one. All the money for the company goes into that account. All the money for the company goes out of that account, all your bills, everything. Then there's two more accounts that sit next to your checking account. Imagine them like beakers in a science lab. Your operating expense account is there. Then you've got an account that's called taxes and you've got an account that's called profit.