5 Live Callers Get Startup Advice from Hormozi & Shaan

0:28I want to try something different. And then we're going to get to what's your biggest business problem. And we're going to try to help you out here in a couple of minutes. So like I said, I'm Flo. I live in London. I own a company called Wentworth Protection. And so what we do is we install security bollards on people's driveways. And if you don't know what that is, it's basically like a metal pole that you put on your driveway to stop your car from getting stolen. I started this business as a side hustle in January 2024. So we're now like a year and a half in. It's just me and my best mate. we both still do this as a side hustle we've got a couple of insulation guys first year we did just 250k rev this year we're probably going to do 500 and kind of the biggest issue we're having right now is content the problem you solve is people in the uk are getting their car stolen and there's some you put a pole in the driveway that prevents that that's correct yeah car theft is just through the roof in in the uk especially around london so So this pole comes up through your driveway.

1:29And it means even if someone gets into your car, they just actually can't drive it away. Okay, got it. So you get$2 ,500 to$50 ,000. You're on pace for$500 ,000 this year. And give us the quick and dirty on how are you getting those customers today? Because you said it's a side hustle. So where are you getting business? Yeah, yeah. So the first three months is basically purely door-to-door. Saturdays and Sundays just knocking on boards, which, by the way, in the UK, people find that really, really strange. But now it's about kind of a 50-50 mix between Google Ads, just like Search, and mainly SEO.

2:00So we get loads of organic leads coming in as well. And then a little bit of referral in there. All right. How much do the polls cost? And the average ticket is about$1 ,000. Okay. So what's cost you to install? We've gone roughly 50 % margin. So like paying the installation guys and buying the units, it's about 50 % of tickets. Okay. got it so you make 500 bucks in gross profit per does that sound right okay got it so what do you want to have happen i want more leads okay got it so what stopped you from doing more door-to-door honestly it's a time constraint currently it seems like that the the conversion rate on door-to-door the amount of time that it takes it just doesn't equate to extra effort put into content or writing or blog posts or trying to reach out to commercial partners, that kind of stuff.

2:50Okay. So one of the big things is like, I think you have to get a little bit narrower in terms of how you want to get leads because you're super resource constrained right now. Like you don't have a ton of capital that you can like put to work or anything like that. And so it's like, you've got, you've got search, you've got SEO, you just mentioned commercial partners, which I'm guessing you're doing through outbound. Is that how you're getting it? And you're also said content. Yeah, correct. Content is basically the nut that I'm trying to crack. I inherently know that content can be really big for this business, but it's just like we did a viral TikTok two days ago.

3:21I did a million views, and it's just not translating to any increase in kind of lead flow. Yeah. So, okay. I want to rewind for a second. I think that, so fundamentally, because you have these three ways that you can reliably get customers, and then you have this other way that you would like to get customers but aren't really getting customers from yet. Does that sound right? Yeah. Okay. So why not, like, what are you spending on search right now? Yeah. About 3K a month. Okay. What do you make back on the 3K? LTV, CAC, about 3 to 1. 3 to 1. Okay. So what stops you? So you're making$9 ,000 a month roughly off Google?

3:56Yeah. Okay. And then SEO is bringing in how much? About the same. Okay. And what do you spend on SEO? Honestly, I'm just doing it all myself. I buy backlinks every now and again, but I'm just doing all the writing and all the technical SEO myself. Okay. Got it. and that's bringing like 9 000 a month as well pretty much yeah about 50 50 and you stopped doing door-to-door right now you're not doing it anymore you stopped doing it because you got tired of it because it stopped working no it's just we it was such a grind in the early days it was like that was the way for us to get the business off the ground so we had no money in we just have to hustle speak to people but at the moment it's like i still have a job i have a kid my partner has a job he has a kid yeah and for us to find any time yeah to go door through it's no heard heard okay so and then the rest is referrals uh yeah it's referrals there's a few little platforms like next door check a trade bark like we get a dribble in through those but but those must be small because you basically said about 10k from each of these that's 20k a month that's 480k a year that's basically what you said you're on track to do what was those 20 right so So that one gets us 250.

5:07You said your run rate's 500? Yeah, correct. So a lot of this is pounds. So the numbers I gave you... Oh, all right, whatever. Big picture, more better new, right? So if you've got search and you've got SEO, I am staring at the door-to-door thing. I will come back to it. But what do you have to make in order to quit the job? We could quit right now. I'm just a little bit of a pussy, to be honest. Okay, fair. Um, well then how many hours are you dedicating to doing this versus the job? Uh, it's like 40 hours on my job and 50 hours on this. I got it. So let me ask you a quick question. If you actually just went door to door for 40 hours a week, I'm not saying you do this, but I just like to ask the hypothetical.

5:53If you went door to door, basically replaced your job with spending 100 % on door to door. I'm not going to say you do that, but just hypothetically, uh, would you be able to replace your income if you did that? I think probably not. I mean, it's just like running really quick numbers. let's say I get, let's say I do make two sales a week or three sales a week from door to door, which would be really impressive for us at this point. That would bring in 1500 gross six a month that wouldn't cover it. Okay, great. So then what stops you from spending like 10 grand a month on Google ads? Yeah, great question.

6:26So we just scaled our Google ads from 1500 up to 3k. Okay. It takes us about two or three months to get that to scale. Okay. Flo, one of the things I love about business is that every problem has already been solved. And so one of the things I would ask is, can you work backwards from a business that already is doing what you're doing? So are you the only guy doing this? Are you the only company that offers this service? And if not, who's that company and how do they get customers? Yeah. Yeah. There's a couple of much, much bigger players in this space. And I think what they've cracked is they're just really, really, really good at organic.

6:59They just get like maybe five 8x the amount of traffic that we get when you say organic i don't think you're saying that the incumbents are amazing at tiktok what do you actually mean when you say they get organic sorry i literally mean like google search okay so they write seo okay heard well let me ask you this question like for so if i if i bought your business tomorrow my first ads would probably be meta ads because like that making meta ads work yeah make making meta ads work. And the thing that you have is one, you have a clear fear. Like people are afraid of cars, their car getting stolen.

7:35And I'm sure you can put some stats up on the board that shows like big arrow to the right. Oh my God, cars are leaving. Right. And you also have a service that is, that is tangible and visible. Like you can demonstrate it much harder to say, Hey, like in a, in an ad, I'm really good at SEO. It's way better to be like, look, car got stolen. Like literally You could just do a before and after of like, look, guy with a mask on gets in the car, walks out. And then right afterwards, guy with a mask gets in. And then he's like, oh, no, this one. It's literally the ads that I would mirror are the car jack ads.

8:07So Google that. It's the little like the bar you put on the steering wheel. Those ads and then you just go local targeting, do a 10 mile radius or whatever that is in kilometers. That I would bet you right now would get you like that would scale like really high. Like you could probably get to 10, 20 ,000 a month. We did, we did meta ads in the early days and I told myself that didn't work, but it was just the crave, which is terrible. Yeah, I'm sure it was. I mean, advertising works. It's not like meta ads don't work, right? It's like you just needed to get the process down. But if you just do a very simple narrative ad with your iPhone, demonstrating the product and the problem that it solves and keep it under 60 seconds, I guarantee that you'll be able to get leads.

8:49And then all you have to do is just call them, get a deposit on the phone for you to show up and then roll the deposit towards the$1 ,000, which is like, hey, it's$100 for an assessment. It's just to make sure that you show up. And if you suck at sales, then say, hey, just put a card down. And then I'll only bill you if you don't show. It's just to make sure because I'm going to send a truck and a guy out there. It's just we don't want to get no-showed. Most people will be fine with that. And then you just roll it right into the$1 ,000 if they just decide today. And that gives you a little bit of urgency in the sale when you show up.

9:16Even better. We don't even have to show up. We can just do the whole thing. We don't really do tight visits. Can I answer your question about it? Wait, you just install it on first go. There's no scouting. Explain that? So you just go out and install it first shot, right? Is that what you're saying? Yeah, they just send us a picture. We say, let's go for it. They send us a 50 % deposit. Yeah, okay. Great. So that's, I mean, literally it's a phone sale. So if I'm looking at all this stuff, the first thing I would do is say like, let's see if I could triple Google ads. You already went to 3K. I'd be like, can we get to nine?

9:46And then it's like, cool, that buys you your job back, right? If you tripled and you kept row ads the same, would that allow you to quit? Yeah, I understand. Right, and I would, before doing meta, I would keep hitting Google ads until I can't do it anymore. I would buy all the traffic. And then once I'd maxed out Google locally, I would 100 % put all my stuff in meta ads. What's the rationale on keeping going on Google rather than just running with, like doing now every extra penny into meta? Because you haven't done it yet. Got it. If you're making money somewhere, make as much as you can first.

10:20And then once you can't make any more, more, better, new. So Flo, one last thing that I think is important is you basically said something that I think is emotional but not logical. And I think you could counter either emotion with emotion or logic with logic, but don't try to counter emotion with logic. So you have, you basically were like, I haven't quit my job. Why? Because I'm being a bit of a pussy about it. So I think you've got to have a conversation with yourself about how you feel about that. Do you want this to be a forever side hustle? or would you actually like this to be your main business?

10:53And if so, where would you get the courage and the conviction to do this? Because you have some evidence. Do you have currently enough evidence? Would you like some more evidence? What would that take? Because you're gonna be limited by your own bandwidth in this business. And so we could give you five strategies that would work, but if you only have 10 hours when you're fatigued to go execute them, you're gonna walk away saying, ah, it didn't really work because you didn't really try it. And so I think for your long-term success, you gotta be able to go all in on this. And maybe now's the time, maybe it's not only you know that, but it sounds like that's something to address today and try to figure out how do I want to think about that?

11:26I know how I have been thinking about it, but how do I want to think about that going forward, right? What's the narrative to myself about that? So don't answer that now, but I think that's something worth doing. That's between you and your therapist. But I think it's important to answer that. I know a lot of entrepreneurs who have gotten success started on the side. I don't know a lot of entrepreneurs who finished with it as on the side, right? So unlikely that that's your end outcome with this is that this stays a side hustle. And so the question is, how do you get there from where you are today?

11:55Yeah, yeah. I love nothing more than being in the game. So I think that's where I'm headed. All right, Flo, we've been charging$1.99 a minute. So you owe us some money now. Thank you for calling the Hormozy Hotline. We will see you later. Thanks, dude. Appreciate you. Let us know what happens. Thank you. Thank you. Thank you. See you at the book launch. Hey, let's take a quick break for a message from our sponsor, HubSpot, who's making this episode possible. Listen, if you're trying to build something big, and I'm talking about$100 million or a billion dollar company, one of the most important things is to focus on the market.

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12:55All right, back to the show. All right. All right. What's up? Who am I speaking to? Speaking to Carson. Thanks, me too. Carson, pleasure, man. Tell us about the business. So yeah, my name's Carson. I have a recruiting business. I tell my clients, hiring should make you money. Not a copy of time. that's why i build diamond connect i'm a customer i use this business work with a lot of companies like true classic x cloud and harvard okay got it so you do you support or what what uh what roles do you recruit for yeah really all roles uh junior to c-level roles did a tmo for sean did performance creative retention social media head of ops so a lot more on the marketing and revgen side Carson, here's your ad, Carson.

13:48Carson found me my CMO for my econ business, who's now the CEO of the econ business. That's as good as you can do when you play someone. There's your plug. All right, what's revenue right now? Right now, for last year, it did 1.6. This year, tracking it hit around 2. Okay, got it. So what's the issue? What's holding it back? Two things. Being a contingency-focused recruiting agency. Yeah. ultimately allowed us to you know get a lot of clients in the door yeah it does come with laws of pausing roles yeah slow communication how to let's get in the game um and so i think really like we've learned once we unlock the first hire they see the value and stick with that really just trying to focus on kind of building that first role with them to show them what we're doing.

14:39Okay. And what's the issue with your current way of doing it? We have like a really good process. It's just, we have a lot of clients that sort of like pause roles. There's a lot of potential on a table for candidates that we have that are interviewing. And I think there's a lot more potential of kind of getting more of a streamlined process, me getting less in the lead. Carson, let me ask you a question. Cause I think ask a better question, you'll get a better answer. Is your question, how do I streamline operations? Is this an operational question or is this a scaling question of, okay, I did 1.6, I did two, I wanna get to five or four a year.

15:12And right now I don't feel like I'm able to do that because of either A, my business model or B, my operation. So is your question on the business model and the growth side of things or is it on the operation? Yes, I would say more on the business side, like the first you said. I guess I kind of said it in two questions, but mainly I wanna scale, right? We're about to hit 2 million this year. I see a lot of potential. I wanna figure out how do I take this contingency recruiting business to five to seven really and being so elite. Yeah. So how do you get customers right now? Really like 98 % of referrals.

15:44You know, a really good, really good pilot base, really good customer base. And a lot of people in the e-com space, just as such a niche space, you know, we get a lot of referrals that way. Got it. So if, I mean, fundamentally, I'll say, I'll ask a different question. If you double the amount of people who are asking for, you know, roles right now, would you be able to handle it? I would say yes. I think I would need to bring on maybe a few extra recruiters in scale. But ultimately, like, these clients used me because of me and the relationships we have. Sure. I'm trying to figure out how do I stay in the week, but also kind of still ramp up in scale, right?

16:23Yeah. So I'll cut you off for a second just to, yeah. So basically, the question that I'm asking, I'll tell you the intention by the question, which is, are you demand constrained or are you supply constrained? Right? And so right now, if I were to say, I can go send you more business, could you handle it? If the answer is yes, then we don't focus on the supply side. We focus on the demand side. If it's, I could handle more, but I've got more people than I can handle right now, and I need to go get more recruiters. So which side is it? Yeah, I think we could handle more. Okay, great. So your demand constraint.

16:51All right. So from the demand perspective, if you only have referrals, then you need to have an input-output in the business to get more leads. Correct. Okay, so it's actually going to be, so best way versus the best way for you will be two different things. So you've got your, you've got the core four. Have you read the book? Correct. Right, so you've got warm outreach, you've got cold outreach, you've got content, and then you've got ads. And then on the other side, you've got affiliates, right? Yes. Okay, so based on your background, you get recruits via Outbound? Yeah, like outbound or really all referrals directly from clients.

17:34Yeah, when you recruited my CMO, it's because you're blasting people on LinkedIn. Hey, would you be interested? Hey, I got something. You're doing outbound to get candidates, which means you have the skill and muscle of outbound already. You're just only using it for your supply. What if you used it for your demand? Ah, that makes sense. Light bulb moment. Let's go. There we go. So fundamentally, you already know your metrics for your outbound funnel. which is like, you know, we do 100 connects and then 100 connects get us whatever, five meetings and then five meetings turn into one fix or whatever it is, right?

18:03All you have to do is just turn that external, same exact funnel. Yeah, really just focus more on the outbound. Yeah, because it's your main game. It's your main game. I wasn't going to be like, hey man, learn ads. It's just like, if you were like, you know what, we're really, because the secondary thing, I'll just be transparent with you, because of the nature you're recruiting, you probably have access to very good marketers. And so if you could go recruit a CMO who could run the ads for you to go get those customers, that would also be a play. but in terms of if I'm going to give like the absolute I had to bet my baby on the fact that you'd be successful I would say do more of the thing that you're already doing just change the change the target that's it and since you've recruited for a whole bunch of different roles recruiting for customers if you think about like that is I think that the natural step and you can for sure scale that to the moon for sure question on the like being a contingency focus right like a lot of scheme of the game uh obviously it's low risk for them high reward for us how do I really kind of like demand sort of more communication, making sure clients are pausing roles.

18:59There's a lot of things out of our control to scale. Yeah. I'm trying to figure out how I... Two things, two things. So, or three things. So one is going to be the customer vetting, right? You have to have certain types of customers. If you have shitty customers, they're going to treat you shitty. If you have good customers, they tend to be more professional. So part of that's going to be, what is our ideal customer? Number one. Number two, the contingency thing, the question is whether it's a feature or a bug, right? Like this may just be a... And like this happens all the time. we'll have these conversations.

19:23They're like, what if we decide this isn't a problem anymore and all of our metrics of the business are fine? Hey, let's take a quick break. You know, HubSpot helped Tumblr solve a big problem. Tumblr needed to move fast. They were trying to produce trending content, but their marketing department was stuck waiting on engineers to code every single email campaign. But now they use HubSpot's customer platform to email real-time trending content to millions of users in just seconds. And the result was huge. Three times more engagement and double the content creation. If you want to move faster like Tumblr, visit HubSpot.com.

19:53All right, back to the show. So what are your margins right now? Probably about 50%. Right, okay. So your margins are fine. And the issue that you have right now is just like, it's like sometimes customers don't do what I want them to. And I get it. And your preference is not for that. So the only tiny tweak you could consider when you have more demand, but you don't have that, which is why you have no leverage, is that you can say, listen, our way of doing this is that you put a card down. It is success-based. But if you don't follow our process, we bill you a penalty because you're wasting our time.

20:23So you can do that. It's an easy, easy fix on the front end and say, listen, the role is 15 grand for the price range you're looking at. We get 30%, whatever the hell it is. But we charge five if you waste our time. Now, we don't want to charge you anything. We don't want to charge you anything. Now, if you get a little bit more, again, this is where supply and demand becomes important. If you continue to get more and more demand, then you start to have more and more of the leverage shift to you. And you say, listen, I do half now and half when we complete the role. because I've got, and if you don't want it, that's fine.

20:50I got 10 other guys behind you. Yep, that makes sense. So you have no leverage right now and it makes sense. So number one, I don't think you have a steaming fire because you've got 50 % margins and things seem to be going okay. You got 98 % referrals, which means you're good at what you do. So I think we just need to put some more in the front end, which is going to be take the outbound engine, point it towards customers, and then be hyper-target about the customers that are going to be the best types. And ideally, you probably know what they look like. Like if you take the top 20 % of your customers now that are worth the most, The beauty of Outbound is you get to snipe who you want.

21:19And so you can just say, I'm only going after people who I know are going to do five roles a year. That's a good way to put it that way. Yeah, Carson, I think what Alex just said is huge for you. I would not have used you had you been like, give me a 20K retainer for this role. Why? Because you were a college kid. You're like 22 years old. You haven't even mentioned that part. It's not broken. You were doing this while you were in college. And so I think you used that to your advantage. So I think that reframing it in your own mind as a feature instead of a bug, I think will do you a lot of good, again, psychologically, because it's your own mind as a founder that drives you nuts.

21:50And once you just literally just relabel the same experience you're having, you will have a new experience. And so try that out along with the outbound. Was that helpful, Carson? That was super helpful, both of you. Thank you so much. Rock and roll, baby. Later. Crush it. All right, let's take maybe one or two more. What do you think? How many of you hot ones do it? The weather is cold, but the deals are hot. What's up? You're on the line. How are you doing, Jordan? How are you guys? Oh, we got a group call. We got the co-founder in here. Is that right? The co-founder is here. All right. You got Sean and this is Alex.

22:23Can you give us your names and your business name and then give us a one minute description. What do you guys do and how is it going revenue wise? I'm Jordan Egbert, Justin Frober. My co-founder is also on the call. Our business is Elite Travel Hackers and we help business owners take their families on$30 ,000 to$50 ,000 laundry vacations for little to no money out of pocket using credit card points. And we do that in two ways. The first thing is we help them optimize and maximize the number of points they're earning per year. So most people will earn one point per dollar on their credit card spend.

22:58We're typically able to get at least a three, four X on those points earned. So you help them get more points and then you help them spend it well, yeah? And then we help you spend it well. first class flights five-star hotels luxury travel all over little so no money out of pocket so jordan is the business working right now or is it broken right now what are we working with yeah what's revenue what's yeah yep business is working you're doing about 40k a month right now um we do have some hurdles that we've come into and i'll let justin kind of go through those oh he's the he's the guy who deals with the problems okay i'm gonna guess that your demand constraint that's going to be my guess i could be wrong but go for it um yeah so uh last month we actually had a really big month we scaled the 85k awesome and uh spent a lot of time refining systems processes automations getting the next round of staff hired so that we can make the next big push on uh leads um right now the majority of our business comes from referrals actually and then 20 % of our business comes from like organic traffic and we only have a 23 % close rate there.

24:04So there's a massive gap between the referring organic close rates. Are you saying 80 % of the businesses referral or you had said that that was the close rate? No, sorry. 69 % of the businesses referrals. Okay. 98 % close rate on referrals. Okay. Everybody closes. And then the rest of the business is through organic. Do you just mean web traffic from Google search or do you mean content based or, you know, a mix of everything. Okay. Is your question, like try to state the question as crisply as you can. So what's the question you guys have? How do we build trust faster and increase close rates from cold traffic?

24:39Is there a tweak in our offer? Yeah. Messaging? All right. I'm going to, I'm going to, I'm going to rock your shit in a couple seconds. So just tell me. So what's the price point right now? Yeah. 3K to 15K. Okay. So it's, it scales depending on their whatever. Number of trips they're taking. Yeah. And how much they're spending out of pocket. Okay. Okay, got it, heard. And so right now, I'm assuming that you have the same sales process for referrals as you do for people from content. Yeah, that's the issue. So every traffic source has to get treated differently because they have a basically, if you think about a customer on a continuum, there's a certain amount of information that has to get consumed in order to make a decision.