245 - He Built a 9-Figure Business & Helped Over 1 Million People Start Theirs with Stu Draper

0:00Our sales were 100 grand year one. We did 500 grand year two, a million year three, two million year four. And every time we kept keeping goals and setting new bigger goals and improving to ourselves, we could do it. And hearing from the market that we were actually fulfilling our mission, which was help educators, help students, help the world. I got fired because you can't cut your way out of growth. I had to learn that lesson the hard way. Go get sales. Go bring revenue into the business. It's the lifeblood of any business. Now with AI, these business owners are like, well, I got to get in on AI.

0:30And Mark said he uses Anthropic. I've never heard of Anthropic. He must be like a genius or something.

0:39All right. I got a freaking treat for you. Today on economics, I'm talking to Stu Draper. Now, Stu is incredible. He's helped over a million people, a million people go through his ed tech program to learn marketing. He's had an eight figure exit, a big eight figure exit. two of his companies have been on the Inc. 5000, a total of 10 times. He's going to help us understand. All right, I'm an entrepreneur. I'm getting into the game. How do I just get my first customer? How do I get business? How do I get started? Because that's been his bread and butter for a long time. Stu, welcome. I'm stoked to talk to you, man.

1:11Nick, thank you so much for having me. You are doing so much good for founders with Nickonomics. And if I can help founders, like that's a big part of my goal. I have a goal to help over a thousand people become millionaires. And so to get to do that through startups and this world, I love it and love being a part of this. Do you ever just sit back and think like, I've helped a million people. I've helped a million people go through a marketing course. That doesn't happen, man. One of the biggest moments was celebrating passing the million mark of people that we had touched. I guess I'm weird.

1:47I don't know, like I would sit as a, as a young man at the counter and see the Cheerios box and go, how cool is it? Psalm created this brand Cheerios that literally everyone on the planet knows, like, I want to create something like that. And I haven't done that yet, but my company, Stukent has now helped over a million students learn digital marketing or other marketing subjects. And it's been so fun to be a part of it. So just a quick overview, you had a digital marketing agency. And then you started this ed tech company, which is Stucamp. Yeah. Yep. I started getfoundfirst.com in 2008. I got laid off from a job.

2:25The recession had just started, but all these small businesses were looking for help with their digital marketing at the time. Most of them hadn't started digital marketing and needed to get going. So it was a great time for me, a hard plan for the world, but a great time for me to start getfoundfirst.com. I grew that from late 2008 to 2015 when I sold it. By then I had already started my other business, stucent.com that I ran from 2013 to 2024 as the CEO. Do you see any similarities between 2008 and today between the rise in the need of digital marketing agencies for small business owners and the rise in need of AI automation agencies now for small business owners?

3:06A hundred percent. When I talk to young college students that connect with me on LinkedIn, you can find me just search up Stuart Draper on LinkedIn. The people that are there in college right now, thinking about what they're going to do to get started at a time when there's not as many job openings and things like that, there is demand for those that have a good, solid foundation and understanding of AI. And frankly, you don't have to be like a language learning model expert. All you need to do is know enough about AI and how to apply it to a skill like marketing or a skill like accounting. And then the number of openings for you are almost endless.

3:48Like you have a job and frankly, as a 20 something, you can be looked at as the expert among at a big table of C-suite level executives in their forties, fifties and 60s, you can be the 20 something expert. That was me in my 20s with digital marketing. I think people forget what it was like back then. We think of digital marketing now and it's like, okay, we got to know exactly how and when to buy ads. We got to know exactly what's the creative going to be and what are we placing it and how do we actually get people to click and what's our CAC and all these things. Back then it was like, do we have a Facebook page?

4:25Do we do Instagram? What's Google search? I don't know. SEO. I've never even heard it. Like it was, the bar was so low just because we were figuring it out. Mobile was just coming out. Mobile was really what opened up the opportunity for people to actually take advantage of Google search, right? Google business profile, SEO, keywords, rankings, all those things. And basically, if you knew anything about that, like if you knew like one of those words, it was like, I'll hire Stu. He's been on Instagram before. and I like see it being similar now with AI because these business owners are like well I got to get in on AI and Mark said he uses anthropic I've never heard of anthropic he must be like a genius or something so we'll just go ahead and hire you know what it just seems so similar if you can if you're if you're young and you're starting out now like that's the wave to really jump on and catch yeah oh absolutely AI for any small business is still like very much a black box for most of them too.

5:22So getting experience and helping those companies see how it can be implemented in their business to help their small business. That's like the number of new consultants and small business agencies that will help that group. That's like for the next six, seven years, a mega opportunity. Let's pretend we've got an idea of what the business is, or maybe we're still trying to figure out what the business is. What do you think is the best way to approach getting that first customer? How do you go from zero to a million dollars when you don't even know how to go from zero to a hundred dollars? You know what I mean?

5:59What's the first step that you see as being the most important? Not being afraid to ask. What do you mean? The fear of failure, the fear of rejection keeps so many people from going and getting their first customer. If you know AI, if you have that skill and you've like dreamt of being your own boss someday, don't be afraid without an LLC formed yet, built your own website yet. It's okay. You don't need your at new business.com email even used your GMAT. Shoot them an email that says, I have a way that I can help you. And I think it can be a game changer for your business. right? How did you get your first paying customer?

6:41My very first paying customer came from a free customer. So I, my free customer. Yeah. Yeah. Oh yeah. So my, I think most startups go through a phase where they got to give some significant discounts if not. So the freemium, the freemium model. Absolutely. So my first business, I think a lot of founders do start their first business as a service-based business. Have you seen that Nick? Dude, totally. Yeah. I totally agree. Agency business. And I think that that's honestly the best way to get started as an agency services business, right? Like either around a specific skillset or something that you know really well, it's the lowest risk way.

7:19High cash flow, not as well positioned from an asset standpoint, but yeah, totally agree. Absolutely. Business valuations, I'm going to be as good, but great first business to cut your teeth and learn how to be an entrepreneur and be successful. You can bootstrap it easily as well. You don't take as much risk and get investors involved. anyway uh so for me i was working my first job our college i'm selling for them it's going well i get laid off but at the same time that i got laid off at night i would moonlight for my brother in law he's a dennison salem oregon and he had three record-breaking months of new patients if you search for dennison salem he was like fourth page i got him the first page i helped him get a good google maps listing and get start getting reviews and uh breaking month of new patience.

8:04So you went to him and you're like, Hey, I think I want to do this. I had this professor say something weird about it. Can I just try it for you? Like you just pitched him as let's just try this. Yep. Bingo. At the end of three months, he paid you, right? Yeah. Yeah. So he started paying me in January. So October through December is all free. In January, he started paying me and he, I could use him as a testimonial to go get other people to pay me. Right. And so that's how I got my first customer was using my free customer as a testimony. So just going back to your point about service-based businesses, I love them so much because if I go start a business that has a lot of capex, all of a sudden I've got this overhead, potentially I've got debt, I've got a lease that I've signed.

8:49It forces me to go full-time. It forces me to sink or swim. These agency businesses, services-based businesses, I could do it as a side hustle. I could kind of moonlight and test it out and like really understand what the product offering is. Can I actually do the fulfillment? What does it look like to scale? It doesn't require me to just jump in, put every sign on the dotted line, right? Like it's way riskier in my experience to kind of go that other route. It sounds like that's what you did. I don't know if you were working doing something else at the same time, but you know, you got a couple months of experience and then you could actually go and say, all right, I know how to do this.

9:23I've nailed it. Let's go and scale it. Yeah, no, that's exactly right. That's how I did it. And I think that the idea of trading your skills and expertise for hours and dollar and those hours for dollars, it's like a job service-based business is you're working yourself into a job and then you have to find a way to hire people to, and like work yourself back out of that job into a leadership and ownership role instead of like doing the day-to-day grind work. I never really figured that out while I was in the service space. Really? No, not very well. So I sold that business when I had a successful product-based business that was two years old.

10:05And I waited until it was two years old because I wanted to make sure it was going to work before I gave up the other thing that buttered. What was the product-based business? So that's Stukent, my tech company. Okay. We did simternships and simulations. We call them simternships. Simternships? Yeah, simulated internships. Dude, I love how all in you went on the terminology. I don't know how else to say this, but the best companies are cult-like. They have their own language, like their own shared language around things, and people are bought in and really have a shared ethos. Yeah. Can I share a cult story?

10:38Hey, we're both LDS, dude. Of course we could talk cults. This is not church-related, I promise, although I am a firm believer that God has guided and directed everything in my career. from a cult perspective, as it relates to businesses. In 2019, so we were now like a six-year-old business. We had quote unquote made it by now. We felt like when we had over a hundred professors paid to come to West Yellowstone, Montana to be at our first ever user conference, right? We called it ProfCon. And at ProfCon, people are like coming up and hugging me to thank me for what I've built for them. That meant the world to me.

11:18I was like walking out of this event going, why didn't I do this two years ago? I needed those hugs two years ago. Right. But on stage, I had given my team a vision that was this, what Under Armour was to Nike and Adidas. That's what Stuket will be to Pearson and McGraw Hill. And I had shared that internally within the organization for like three years. Okay. And I can dive into why I came up with that later if you'd like. But at the conference, I shared that vision with the professors in the audience. I said, I believe that someday what Under Armour was to Nike and Adidas, that's what Stukat will become to Pearson and McGraw-Hill.

12:01And in the back of the room, one of the professors was doodling while I was speaking from Oklahoma State University. And Jerry, he finished his little doodle and he just left it on the table and his colleagues sitting next to him, Kenda, she looks over and she's like snickering and laughing. And she's like, Jerry, you have to show this to Stu after. So they walk up to me after and they show me this doodle. Okay. On the doodle is a fish that says Stuket written out inside the fish. And then there's three little fish being about to be chomped by the Stuket fish and it's McGraw Hill. they've three little fish and one says mick in it one says graham one says hill okay like two weeks two weeks three weeks later i got a t-shirt in the mail from my customer that had no you can't fish eating mcgraw hill my customers were that on board with my vision that we could change the ed tech world that was a huge aha moment for me not not it was obviously like a measuring stick of success and brand power.

13:10But really what it did to me was it told me like, you have to not only give as the CEO, if you're going to grow a scalable business, you have to give your team a vision of what's possible. And then you have to go give your customers a similar vision. That is ultra powerful. And so I do wish still today, instead of starting ProfCon after year six, I'd started it after year three or four. We didn't make a lot of money at the conference, but the long-term brand power. So we're, I think about that a lot because if you're starting a business as an entrepreneur, you can get pretty far just by yourself.

13:47You're going to drag people along with you, but you hit a ceiling. Like it comes to a point where, all right, now I need other people around me to get me to the next level. And to your point, in order to get to the next level, when you have those people around you, you've got to give them a vision and you've got to give them shared language. And typically shared language is created in this sort of exercise that we do around what are our core values? What's our mission statement? What's our vision statement? Right? But if you don't have that shared language, you're going to stay at that ceiling.

14:16Because you as the founder, you can't be in every meeting. You can't talk to every new hire. As you expand past 30, 40, 50 employees, you just don't have enough time to do it. The only way that you can scale what you've started is to have shared language. and like, oh, hey man, our centerships have to be really spot on. It's like, I don't know what that means, but everybody I'm sure in your organization knew what a centership was. And I'm sure there was lots of other sayings like that, but if you're going to grow, you have to have that shared language. And many times, obviously you see that in cults, but you also see that in these businesses where like people believe they buy into you, they buy into stew.

14:53They're like, no, we're going to eat McGraw Hill. Those three fish are going to be chomped. Let's, let's go and do this. Let's, let's create somebody, an enemy, not an enemy, but a shared foe for us to go and conquer. I, I, uh, I love that stuff for entrepreneurs when they get to that level. New hires on their first month of being hired. I ask everyone to come in for what's called the underarm or speech with steel. Hey, I don't know if you remember this, but when we started this podcast, we entered into a social contract. I would spend time, energy, and money producing this podcast, interviewing these individuals and giving you insights into how to build, buy, start, grow your business.

15:30And you would like subscribe and leave me five-star review. Now, out of that, we both get to talk to really cool people and hear really cool insights. We both get a ton of value, but I just want to help you keep your word. So would you do me a favor? Will you go leave a five-star review for me on Apple or Spotify? It would really help. And if you want, even share this with a friend. I give them that vision. We talk mission, vision, values, right? All three of those things. And I think for a lot of founders, they're like, ah, that's bogus stuff. It can be bogus if you don't have your own mission, vision, and values.

16:07100%. But if you actually have a vision and a mission and you have some values as a founder, you get to lead out and make it not bogus. What was your aha moment for that? When did you realize that was necessary in order to, because you, because you said you weren't good at it, right? You did this digital agency and you kind of hit a ceiling or you couldn't figure out how to grow. Is that right? Yeah, no, a hundred percent. I think for me, my aha moment was multiple aha moments where my vision could be expanded. Okay. When I first had the idea for Stuket, I went to my mentor and I said, Hey, if I can get a hundred students at a hundred universities, that'll pay me a hundred dollars, that's a million dollars.

16:53A hundred times, a hundred times, a hundred is a million. And if I can do that twice a year, that's a$2 million business. Like I'm on to something here. Right. And then I was like, well, that's only a hundred of them. I know there's thousands that I could go get. Right. And so that was a first aha vision moment for me was when I said that a hundred times, a hundred times, a hundred. And then I started sharing that with the team. Right. Well, then we did 2 million in sales. And who was the team at that time? Sorry. who was the team oh so small i mean i had a cro that did the sales at the time i think i called them vp of sales or sales leader i don't know but then i had a vp of marketing so it's like three of you yeah the first founding team is so small you did a million dollars or two million dollars in that first year just that team we did two million so our sales were 100 grand year one that was the three kind of stage right okay and we were probably four right then we did 500 grand year two a million year three, two million year four.

17:48And every time we kept hitting goals and setting new bigger goals and improving to ourselves, we could do it. And hearing from the market that we were actually fulfilling our mission, which was help educators, help students, help the world. And we could like celebrate that we were fulfilling this mission. Dude, from there, everything got, the vision was able to expand. And here's where I came up with this idea for the vision, the vision statement around what Under Armour was to Nike and Adidas. So every day someone in the company is in charge, and I think they still do this at Stuket 12 years in.

18:25Every day someone's in charge of a motivational moment that everyone can go look on Slack and see what the motivational moment of the day is, right? It was my turn to give the motivational moment. We were like a 10, 12 person team at the time. I'm scrolling across YouTube and I found Kevin Plank, the founder of Under Armour, speaking to his alma mater, University of Maryland. In his talk, he shared the first five or six years worth of sales numbers for Under Armour. And Stu Kent's numbers beat Under Armour's numbers the first five years. And I was like, no way. We are going and growing faster than a household name, global brand that's now doing billions in sales.

19:11Our first five years in little Rexburg, Idaho, our education technology company is outperforming Under Armour. For me - Did you learn that? That gave me vision, right? Then when I caught that vision, I pulled everyone into a room as fast as I could to watch that video with me. Did you learn that before or after you made the word, what Under Armour was to Nike, we're going to be to McGraw Hill? Did you know that before or after you said that statement no that was after after i watched that okay when i had that aha moment and i created that i was gonna be like dude that that would have been nuts you're like you said this and then all of a sudden you're like oh wow and we're growing faster than them tell me about the first few years so you had the digital agency did that effectively fund your ability to grow this the ed tech right because you said you did a hundred thousand dollars in year one sales but you had a team of three people plus you so it's not like you unless they were working for free.

20:05I don't think that that was necessarily supporting them. How did you balance the two? So seed funding is what got us through. I had an angel investor put in the first 25 grand. And when he did, he shot me a note with that 25 grand that said, Hey, this is your first investor money and I'll help you raise the rest. You got to quit everything else you're doing and go all in or don't. And so I did, I took the money and said, I'm going to do this. Uh, by the way, when he wrote that check, I had worked on the business plan for two years. I had all, and he had been my mentor. Like we would go to breakfast at Perkins.

20:45He was very aware of my idea, what I was working on and kind of coaching me through the, the, the market research phase where we called over a hundred professors at a hundred schools and 60 % were unhappy with what they were teaching and 40 % still weren't even teaching digital marketing yet. And this was a decade after digital marketing had gotten going with Google making their money online. Right. And so it was like high time for higher education to catch up. And so Stu Kent's slogan is stay current because it was like, wow, the education space is really behind if 10 years in, we can be the innovator.

21:23So it was a fun opportunity for us to come in and innovate fast and be the savior that they needed. I think if you're a founder looking at starting a business and you're going to create a pizza company, how are you going to be the savior in your town? Are you the first pizza company? Is that why? Are you the first pizza company to do X, Y, or Z that none of the other pizza companies do? Okay. You might be innovating and finding a way to be the savior for me, like the education world had been beat up in the media for years. Like, like my whole life, basically, I've heard that the U S is behind in education in all these countries.

22:03Right. So I knew there was a problem and I wasn't that excited about my experience getting my four year degree. And so I knew there was a better way. And I, and I felt like I was onto an idea that could create that up-to-date tech folks, sim internships that gave students hands-on, real-world experience in real time as they're learning. And so that's what we did. And I think you've got to ask yourself if you're doing that. For me, once we did that, everything worked itself out. The product market fit was there. We found a way to work. When I talk to founders, I always say that agency businesses, like we talked about, services businesses, are the best way to go.

22:41Because, hey, if you're an engineer, cool. Now you have an engineering consulting agency. Or if you're a CPA, oh, I just started my own CPA business. But what it allows you to do is get into entrepreneurship. You just start understanding what is a P &L? How do I manage cash as it comes in? And how do I manage cash as it goes out? And then very analogous to tech, you can land and expand. So if you had one product offering, well, pretty quickly you can, Hey, I get in with this one company that liked my payroll software. Well, what do they do for accounts payable? And what do they do for HR onboarding?

23:13And what do they do for accounting. So you're just in the game. And when you're in the game, you have opportunities that come your way. For you, was the digital agency, did it serve that purpose? Was it like you kind of cut your teeth and then you saw this opportunity and were like, yep, I've gotten this experience. I'm going all in. Yeah. I'm hiring students for Get Found First that have the basics of digital marketing from college. My professor Kent was kind of feeding me some of his talent. He said, hey, Stu, will you come back and teach digital marketing? And I was like, I'll happily teach.

23:47I've always thought it'd be cool to be a professor. And so I started teaching digital marketing and that's when I went, okay, wait, same stuff Kent taught me four years ago is kind of what I'm learning or what he gave me as curriculum to teach now. And that's not good enough. Right. And then it was like only a word document with hyperlinks to places online. Half the links didn't work right. Students didn't know how much to read, whether they had to click to additional pages or not. And they were like, this is unfair. I don't want to be quizzed and tested on. And so I was like, well, I should write a textbook.

24:21And that was at first such an outlandish thought. I didn't even have a master's degree. You didn't even have AI to write it for you. I didn't have AI to write it for you. Dude, I just love how your story articulates. I think people don't quite understand about entrepreneurship where just getting in the game, you have no idea where you're going to be in five years, right? You got laid off, so you're like, I'm going to start this digital agency. And you do it, and then obviously you have this relationship with this professor who's sending you students, and you do a good job. And then all of a sudden that leads to you want to come be adjunct.

24:51And then all of a sudden that leads to do you want to write a book? And then you meet somebody else, and now they're co-authoring a book with you. And then all of a sudden it's like, I'm going to go to 100 universities around the country, and you get those universities. And then pretty soon it's 2024, it's 10 years down the line, and you're selling the business for eight figures. and none of that would have happened had you not been pushed and laid off in the first place i shouldn't say none of that yeah you might have gone into entrepreneurship maybe down the road but like you you got pushed i got pushed man yeah and if those failures young pushed me into these i mean i sold alarms for a summer sucked at that i thought man nate fails isn't the new i sold used cars and got fired two months in basically business like another month after that those dirtbag should have just held on to me and let me get laid off with the business dying.

25:39And they knew it was dying, but I thought I just sucked. Anyway, I had some real failures young that led to me being able to decide I need to just go find my own way. That's where I'm going to win is hold my own thing. I kind of had dreamt as a kid that I would be my own boss someday, but no idea it would start that fast. And yeah, I needed to be laid off. But I want to point something out, Nick, to listeners today. You mentioned earlier the P &L, which I think scares people, profit and loss statement. Hearing balance sheet, income statement, oh, I didn't go to business school and I don't know those things.