What Is Your Time Worth?

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1:40Ilana Golan:We're the Hartford. With decades of experience ensuring millions of unique small businesses, when it comes to your small business insurance. Thank you. One size absolutely does not fit all. Get a quote or find an agent today at thehartford.com slash small business. The truth is the dollar amount, people will pay you what you believe you're worth. You know the value of the results that you are going to deliver. Running a business means solving problems. I tell you how the smartest entrepreneurs do it. Hi, I'm Jason Pfeiffer, editor-in-chief of Entrepreneur Magazine, and this is Problem Solvers.

2:20Let me tell you something I always doubt about myself. This is true. I feel like I deliver a lot of value. I know that if someone wants to work with me, I will show up. I'll do a great job. They will leave feeling better and more knowledgeable and more set up for success than before. I have absolutely no idea what I'm supposed to charge them. No, none. I'm just sort of trying to calibrate it in real time? What if I say a large number and then they say no and then I run away screaming and then the next time I charge somebody way too little and they say yes way too fast and then I feel like, oh my God, I'm getting ripped off.

2:54I just don't know how to do this. And I feel like so many people are just like me. I've heard it all the time. What am I supposed to charge for my services? Today we are answering that question with someone who helps people figure out the answer daily. Her name is Ilana Golan. She is the CEO and founder of Leap Academy. Ilana, give us some background here on how you are the person to answer this question. And welcome to Problem Solvers. Ah, Jason, this is so, so, so fun. And yes, I am here for free. And you also came to my podcast and I love that. And I love collaborating with really smart people.

3:32And I've been following your journey for so long. So thank you for having me, first of all, on the show. And for those listening, you described it so, so well because you described my life. I was probably the person that negotiated the worst salary ever in Silicon Valley history. And I went up the ranks in different companies. I started actually in the Air Force, kind of moved up the ranks to engineering and technical sales and product management, all the way to vice president. And at some point, we don't have to go into that, but I kind of lost almost everything I had in my life. And I lost my job.

4:10I lost my company. I was kicked out of my own startup. And Jason, this is where I needed to figure out on my own. Like, what do I do? I was lost. Like, I was giving everyone everything for free all the time. and at some point I still remember the day that we you know came up and you know we we sat and did our taxes and I was flying all day like all night like all the time we were doing our taxes and it was like how much did you make uh I brought nothing home and and the truth is Jason it wasn't zero it was actually like if you really think about it I didn't take a salary right so it's like minus whatever,$200 ,000.

4:49And anyway, and there's a bigger story there because it wasn't actually minus$200 ,000. In fact, I didn't take, like I helped a company, they're now valued at$14 billion and that tiny, tiny equity would have been$30 million. So if you think about it, The cost of the university of not knowing was in the minus, you know, in the$30 million for me. Yeah. And I bet, sorry to just jump in, but I also wanted to reinforce this. Like, I bet that, I actually used the word reinforce a little too early, but I will reinforce this idea of reinforcing, which is to say that you're telling this story in which you had undervalued or completely devalued yourself, even though you were delivering value to other people.

5:41And that continually reinforces to yourself that you don't have a monetary value, right? It's like the more in which you put yourself out in the world at a low value, the more in which you are afraid to ever raise that value. That is something I at least felt very significantly at the very beginning of this where I would do talks for free. And people would be happy for me to be there. But then I would think, well, you know, now that I'm doing it for free, I can't charge them. They would find that completely obnoxious that I would charge them or I would charge them just a tiny bit because I felt like, well, you know, I'm not good enough to be the person that gets paid a lot.

6:25It becomes this story that you're telling yourself over and over again that actually holds you down from telling a different story. and what i'll say into that jason because this is spot on what most people go through what i went through and in fact what we're actually don't realizing is that we're actually doing a disservice for not charging so when you're actually thinking that you're giving value for giving things for free think about how many i don't know self-help book you have you know on your shelf and you don't even open them because they were either free or$9.99 or whatever they were, you don't open them.

7:05Why? I actually, it was, it was actually amazing. Like there was a book that I had on my shelf for since 2017. And last year I went to this big event. It was somebody I've been following for a long time. I paid$50 ,000 for his course, Jason. And guess what? I took action and my entire team took action. Why? It was the same information that was on my desk for seven years. So when people pay, they pay attention. And once you understand that you actually have the ability, and I can give you actually in a framework that everybody can follow, but if you understand, first of all, just in your mind, that you have the ability to change people's perception, their life, their careers, their health, whatever, you have an ability to create transformation, that is worth a lot.

7:59Like for some people, this is everything. So by not charging, you're actually taking something away from them because they will not take you seriously. Right. So, okay, I'd like to hear that framework because I want to acknowledge that there's probably many people listening who relate to what we're saying so far, but also many who don't because they're like, look, I'm not giving something away for free. I understand that I am very valuable. I'm just not exactly sure what to charge. This is where I think many people are, is that they understand that they have value. They're not afraid of charging unless they're at the very beginning.

8:31They just don't know exactly how to pick that number. So help us pick that number. Yeah. So first of all, we'll do a little exercise and a little framework that I think will really, really help everybody listening. But I'm also going to say, It's okay to not, like when you are just getting started, it's okay to charge less so that you can build the evidence and stack on the evidence and bring yourself more success stories, etc. It's okay. That's how everybody starts. And the way I like to look at it is like literally frame it. Like I hope whatever audience, right? In my case, driven professionals or teams.

9:12What do you help them do, right? In my case, reinvent, leap their careers. What do you help them do? Right. And then so that what is the value that you're giving? Right. In my case, so that they get the pay, the reputation, the income, the value, you know, like the freedom that they want. So what are you helping them do? So first of all, just write it down. Then what I like to do is actually draw almost like a little rainbow. So it's like two clouds and like four to six steps like of a rainbow in between. And the first cloud is the pain.

9:45Ilana Golan:at CLA we're in your corner and on it we coach tax strategies and little league first base we help you adopt ai data tools and we adopt rescues named buddy we walk your factory floor and jog the local 5k though sometimes we walk that too wherever you're coming from we're right there with you wherever you're going we'll get you there CLA CPAs consultants and advisors Learn more at claconnect.com slash with you. Study and play. Come together on a Windows 11 PC. And for a limited time, college students get the best of both worlds. Get the Unreal College Deal. Everything you need to study and play with select Windows 11 PCs.

10:29Eligible students get a year of Microsoft 365 Premium and a year of Xbox Game Pass Ultimate with a custom color Xbox wireless controller. Learn more at windows.com slash student offer. While supplies last, ends June 30th. Terms at aka.ms slash college pc. And where... Like your consumer's pain point. Yeah, the customer pain point. And I wanted to really think about not the high level pain point, but what is actually going on in the middle of the night when they're looking in the mirror, when they're hard on themselves. What is actually going on? Because on one hand, I'll give you an example for me, and I'm sure you're seeing this, like for driven professionals, initially they'll say, oh, it's not that bad.

11:11I, you know, I'm just looking for a job or I'm just, you know, I just want more out of my career. Right. But at three in the morning, what went through my head is how on earth did I become such a failure? How on earth can I not figure this out? Why on earth am I not further along in my career? You're talking about the difference between the external problem and the internal problem, right? The external problem is the surface level, got to get this solved. And that exists in every market. If you are painting houses, then the external problem that you solve is that the house needs a paint job. But the internal problem is the thing that is underneath it, the thing that is driving emotional distress in your consumer, which again, for the paint job thing could be, and this is, I'm stealing this anecdote from Donald Miller from building a story brand.

12:03I'm not coming up with this myself, but it's, um, it's, it could be, uh, um, not feeling, uh, like that you're keeping up with the Joneses, right? Like that you have the ugliest house on the block, uh, that you're falling behind your neighbors. That's perfect. So, and, and I absolutely agree because again, like you gave that beautiful example, it is the embarrassment. It is my kid is not bringing my, their friends to the house, right? Like the, the underlying pain point is much deeper than I need to paint the house. So you want to understand, and here's the kicker, Jason, when you describe somebody's pain better than they were able to describe it, you automatically become an authority, even if you're not an authority yet.

12:47So once you understand that, first of all, just knowing the real truth is really, really important. Then what you want to look at is kind of the dream, right? The other cloud is like the dream, right? Like where do they really want. Like you said, it's not just about painting the house, but I want to feel like I'm the role model or I'm successful or whatever. I've got the house that everybody envies. For example, right? And the beautiful thing then, the rainbow is really your framework. And that's where you become a category of one, right? What is your exact framework to move from the pain to the dream, right?

13:30It could be if you're a consultant, you go to a company and you do a 360 or whatever, I'm making this up or you're talking to, right? Like it could be, but that's your framework, right? In our case, like you get the clarity, you tell a better story, you build a brand, you learn to open doors. Like what is the exact framework? And really write that down because the beautiful thing is we'll talk about, we can talk about a conversation of how you actually price it, right? But the actual price is pretty simple. It's the distance between the pain and the dream. It's the distance between the pain and the dream is the price.

14:04So this is interesting because I would have thought that what you're describing here is about marketing and communications and it's about being able to effectively communicate to your consumer what value you have. but you're saying, no, this is actually an exercise in getting down to an actual dollar amount. Pretty much. Because again, the truth is the dollar amount, people will pay you what you believe you're worth. They might not be able to afford you. Don't get me wrong. But you dictate what the answer is. But the answer is, and for you to be okay with the answer, the biggest price, the biggest problem with pricing is us.

14:48Like if I basically go on a call with a client or a lead and I basically say, okay, so tell me, what is the biggest thing not working well enough in my case, your career, your home, your whatever, right? And they basically like, initially they don't tell everything and you start and I go, oh, so tell me, what have you tried? Wow. So you've been out of work for, wow, a year. I mean, that must be hurting. I mean, That's what you already lost, like$200 ,000. That's painful. Like, what is the event? What caused it to say now is I need to figure this out? What made this now more urgent than ever? Right?

15:27And they start telling you the story, right, and the truth. And then, okay, so now with that in mind, how is that impacting everything? I mean, I'm sure for me it impacted everything, Jason. Like, I lost, like, I was, you know, I didn't sleep at night. I was snappy at my kids. I was nappy at my husband. I was, my health deteriorated. I mean, it impacts everything, right? So now you go a little deeper into the magnitude of what actually is happening there, right? And then, okay, so what is the dream? What are you trying to achieve? Amazing. So I'm 100 % confident we can take you there. This is how we do this.

16:05And when you explain how we do this, this is the rainbow. The first thing we do is, and you come with a lot of authority because it looks like you know what you're doing because you do, right? Because if you would sit with somebody over coffee, you would know what to say. Now you just need to price it. So now I say, okay, great. So this is how we do this. First, we do this. Then we do second. Then we do, you know, your clarity and your brand and your whatever and open doors or whatever. And great. So the way we charge this is$10 ,000 over$5 ,000 or$15 ,000, whatever you want to charge for it. Because the truth is people that will create that transformation, it's going to be worth millions for them in a decade.

16:43Wait, wait, wait, wait. Okay, wait. But, okay, I was with you right up until you said whatever you want to charge for it. And the reason for that is because I see what you're doing here and the way in which you're taking this understanding of the consumer and then showing them exactly how you are going to help solve the external and internal problem that you're voicing so they trust you. And all of that is actually an exercising in increasing your value perception. The more in which they trust you to solve this problem and the more in which you are able to identify how great their life is going to be or how much money they're going to make or whatever it is, the more in which they are willing to pay.

17:31But Ilana, there's still this issue of what can they afford and what kind of market you serving. I'll give you an example. Outside of entrepreneur, I have a company called CPG Fast Track that I started with a couple of friends. And we serve early stage consumer packaged goods founders. They come in, they're put in a small group. They get guidance and support from their peers, but also from experienced CPG leaders. We have been trying to figure out the price for this product since we launched two years ago because we're serving an early stage consumer that needs it, needs it. And we can talk to them about the external, the internal problem, and we could increase our value perception and all of that.

18:17They know it, they need it. But the problem is their cash strap because they are running a cash intensive business, often by themselves. They have no investors and they're looking at every dollar and they're trying to decide, does this dollar go to CPG Fast Track or does this dollar go to performance marketing? And so we have raised the price. We have lowered the price. We've tried to create like different tiers. We cannot figure out the price. So that is where, when I go back to you being like, you could charge$10 ,000,$50 ,000, charge whatever you want. I'm like, wait a second, but I can't charge whatever I want, Ilana, because I've got a constraint inside the market that I'm serving.

18:52So help me. So I would question that constraint because I think that constraint has direct correlation. And again, sometimes we do, right? We're serving people that, I don't know, make$10 an hour and there's a real constraint there, right? You can't charge the same thing. You do need to understand your market. But I will also say that you need to understand what is the true ROI. And the most important piece is for you to be okay with ROI. Because I think the hardest thing for me was to start stacking up the evidence of, oh my God, these people are making five to six figure extra because of our help.

19:33Of course, this is worth it for them, even if they don't see it initially. To tell you that we don't have people that are freaking out and they're scared or whatever, of course they do, right? And we have different tiers and we have different pricing points. But at the end of the day, I know what they're getting at the other side. So first of all, I would say the very first thing is for us to be okay with the price. And I think that's where a lot of the hiccup usually comes. And then it's about showing the people with a ton of, again, integrity, but also with a ton of authority of what we can actually do for them.

20:06Because if I'm positive, and Jason, in your case, I am positive that they're going to be much better off with Jason than any of the lame, whatever, marketing, trying their luck, you know, lame other competitors, whatever, like they're going to pay somebody that will change the LinkedIn banner and we'll tell them this is going to change all your life. Right. But you know exactly what it is. And anybody that has been following you knows that you have a different way of following than anybody else. So you clearly knows how to attract people your way. So for me, it's more about who should you put the money on?

20:40You're right. It's a good question. But for me, the question is, you know, I want you to make a decision and to say, how can I 2x or 10x or whatever it is, you know, how can I do that as fast as humanly possible? As you're saying all that, the thing that I really got caught on was being able to state the ROI. And over at CPG Fast Track, that's something that we've certainly struggled with is what is the exact ROI? We know there's lots of value, but can we put a number to it? And we haven't yet. And I think that we need to. We need to, through the case studies, we need to be able to say that members who invested this got this out of it.

21:26And I'd love to hear you talk through how to identify that ROI so that you can state it back to the consumer. Such a good question. And first of all, I will say, and that's why when people are just getting started, honestly, don't worry about ROI initially. Like just start, even if it's like$1 ,000,$900, like just get something so that you can start creating evidence of what you can perform. And by the way, you're also going to learn a lot because leap looks very different when we started than when it is right now, right? So you're also going to learn a lot. You're going to see where people get stuck.

22:03So first of all, it's okay to not scale in the beginning. The way I would look at ROI, and maybe I'll give a few examples. Maybe it's the easiest way. So one, you talked about speaking. I think it's a fantastic example. So the very first thing is to really understand when are you saying, what should you say yes to and what should you say no to? And with a lot of intentionality here. So for example, when I wanted to judge TechCrunch, you know, pitch competition, for me, having that logo actually meant more than anything. So, you know, I wouldn't charge for that because it wouldn't make sense and they wouldn't invite me, et cetera.

22:40So you also need to understand why are you saying yes to things and why are you saying no to something. Now, the way to judge ROI, if I need to just kind of put a really fast way to look at it. So if I'm going to speak in front of a company that the CEO runs, I don't know, they're running a billion dollar company. Let's just make it for this simplicity. And if I can move their sales team by even just 1%, just one minuscule percent, right? That for me, again, it depends how you measure it, but let's assume that they're doing 100 million a year. And maybe they're doing like a million. So that 1 % is a million dollars.

23:26So I'm not asking you to charge a million dollars, but is that worth 10, 15, 20K? I mean, it becomes a no-brainer. You're saying that if I can identify that doing this with me has yielded a million dollars, then it's an easy case to make that you should pay me a significant. Yeah. All you need to do is get their sales team a little more motivated. But what if there isn't that specific? I'm just making something up. I paint people's nails. I paint people's nails. and it's great. I am so talented at painting people's nails and people come in and they walk out with something that is sparkly and amazing and they get to show their friends.

24:11Okay, how on earth do I price that? I can understand what to think about the internal and the external value. I can understand how I could like show them and I can make it, but they're not gonna have a dollar amount the way that a sales team increasing by 1 % is gonna yield a million more dollars. So what is the stated ROI there? How do I start to talk to them about the value use such that I can put a high price point on a service like that. Right. And again, I don't know if like in a nails case, I will go a lot higher than 100, 200, whatever. Right. Like, I mean, I think at some point you also need to understand like where where the market tells you to go.

24:46Right. But in the case of nails, I can tell you, at least for my daughter, like I don't do my nails, but my daughter is fanatic about it and it gives her confidence. It gives her clout. It gives her, ability to be with friends. And for her, even though she doesn't have almost any money, she will go across with buses to this nail salon and she will spend$100 to get her nails on. Now, I can't understand it for the life of me, Jason, but this is real. Do you recommend experimenting with price just to see where the market is? my greatest example with this aside from speaking where i've you know given out different prices and seen what happens is that i'm on this service called intro where people can book my time for 15 or 30 minute calls for whatever it's worth it's intro.co slash jason pfeiffer and i have played around with the pricing on that just trying to figure out if i raise the price do the bookings drop do they drop to zero if i draw if i lower the price do i get more bookings than i would like and i've kind of landed at 500 for 30 minutes of my time and that like seems to like bookings come in but not too many bookings and so that seems to be good and it's like an interesting testing of the market but i never knew if there was another way to do that or if it's really just about like blindly i mean it literally feels like i'm just blind and i'm in a room and I'm just like touching the walls to feel where the boundaries are.

26:18And I'm not sure if there's a smarter way to do something like this. So there is experimentation with price a little bit. The only thing that I'll say, and there's also a difference between if it's something a little more static, like intro, right? Whoever comes in, comes in and then it's worth playing a little bit with the pricing versus if you're having a verbal conversation with clients. The reason why I don't like actually having different price points is because I think you become very weak in the sales process. If I quote$25 ,000 for something, but I know deep in my heart that I will accept$15 ,000, then I will let people talk me down.

26:59But what you're saying is do not be afraid of saying the high price and then having people balk at it if you know exactly how to make the case and bring your value up to the point where they actually will buy? And you're saying that will happen. People who are afraid of a high price point will actually buy if you just make the case better enough? Oh, absolutely. I mean, again, because again, you know the value of the results that you are going to deliver. And if we have time, I'll talk a little bit about like, how do you look at pricing an hour for yourself a little bit? Yeah, Ilana, actually, that's a great place to land on.