How to win at business and make a dent, with serial entrepreneur Daniel Priestley

0:04There is ideation. There is actually a process between coming up with a good idea and a bad idea. There are principles for good ideas and principles for bad ideas. And it's great to have bad ideas. The more bad ideas you have, the more good ideas you'll have. In the same way, the more bad songs a songwriter writes, the more hits they're going to have. There is a process of ideation, of coming up with ideas and finding the right ideas and testing the right ideas.

0:29That's Daniel Priestley. And if he sounds familiar, it's because this is his second episode on Secret Leaders. The first was way back in 2017 on just our ninth episode. As a cheeky refresher, Daniel is prolific. He's the best-selling author of books like Key Person of Influence, 24 Assets and Oversubscribed. He's a lecturer and an excellent teacher of entrepreneurship. You'll hear some of his gems today, which I wager will make you a better business builder. We wouldn't get him on unless he practices what he preaches. He's also the co-founder and CEO of consulting agency Dent Global. Now, we don't have people back again for no reason.

1:08Earlier this year, he published a new book, Scorecard Marketing. He's working on a couple of new book projects, and he's also launched a new business, ScoreApp. It's a self-service platform that simplifies quiz funnel marketing. Imagine asking your website visitors to take a relevant quiz, like how healthy their brain is, rather than just asking people to leave an email address for you to contact them on some random newsletter. I did exactly that at my company Heights. It leads to more engagement, more quality leads, and it's flying. He launched it in 2020, and it's already grown into a$20 million business.

1:44I think there are more lessons in this episode about building business than we've had in a while. I hope you like it. It's time for round two. What do you think is the one thing that AI is going to give humanity that no one's talking about? There's a few things that not nobody's talking about, but not enough people are talking about. And I would say that the first one is digital royalty. So what I mean by digital royalty is if you look back over the last 10 ,000 years, humans tend to organize themselves into a feudal society where you have a small group of leaders who have absolutely everything, and a very, very large group of people who have absolutely nothing.

2:23And people haven't drawn a comparison between artificial intelligence and soil and I mean physical soil so if you if you take physical soil actual soil dirt land it is an artificial intelligence you put a prompt in called a seed that seed knows exactly what to do it grows a tree and then it bears fruit and humans are not really required between planting the seed and picking the fruit nature just knows what to do so if we think about this as a automation process where humans just simply put something in and then outcome something of value. We look at the societies that came up and sort of surrounded that as the primary mechanism for making value and they were all feudal societies.

3:05So it was basically a king who owns all the land with some dukes who are very good at organizing labor and then plebs or serfs who are on the land. Now what we're probably going to have here is we're going to have a society that goes back to this kind of structure if we're not careful. I think we're going to see a lot of 10 people companies that have 100 billion of revenue. So we're going to see a lot of businesses that have 10 million revenue per person, massively automated, massive leverage, massive scale. In the last, say 10, 15 years, there was very famously Instagram that had 13 people at the time of acquisition for a billion of value.

3:42What we're going to see going forwards is, you know, a number of companies that have just very, very small headcount and artificial intelligence doing a vast majority of the value creation. And we're going to see these businesses that have hundreds of millions in revenue with a very, very small headcount. We're going to see a lot more of that. I massively agree for what it's worth. Like we've got a target at heights of getting to 1 million pounds of revenue per employee. And the fact that that's even possible in a company that's got a vertically integrated supply chain with physical product is because of AI, is because of automation.

4:16It's, you know, a company like ours wouldn't normally be able to do that's much more set up for tech. The fact that we can isn't because we're brilliant. It's actually just because of the time we live in. Yeah, exactly that. And when we see AI start to eat the very expensive jobs as well, we're going to see some businesses that become hugely scalable, hugely profitable. And those businesses are going to start gobbling up everything. What are the what are your three favourite books you think people should read or have influenced your life? And you're not allowed to name any of yours? Well, I am going to name mine.

4:50And the reason I'm going to say this is not because people should read mine. But the books that have influenced my life have been the ones that I've written. And for that reason, I always encourage people to try and write a book. And I always say to people, the book that changes your life the most is not one you read, it's one that you write. And in particular, it's one that you give away free copies. I think one of the most successful strategies that I've ever come across is the ability to give away books to the people you would love to meet. I find that very inspiring because I've always wanted to write a book.

5:21I've actually had a conversation with you in the past about this briefly. You probably won't remember it. I've been asked by Penguin Random House and, you know, these guys and that HarperCollins and all of the different guys at different times to write a business book because of secret leaders. And every time I've said no, because I've got lots of friends who are professional authors and I know how much work it takes. Equally, you are one of the only people I know who is a successful independently self-published author. And although the advances are quite decent, I've always found it quite an interesting model versus yours.

5:52Yours is really the classic entrepreneurship model of I'm going to back myself fully. So take us through the two different models. What do you think the pros and cons are? What should people do? So I'm published with a big publisher called Wiley, which is a big hundred year old traditional publisher. And I'm also published with an independent publisher called Rethink Press. I originally published or some of my books are with Wiley. It's very difficult to give away your own books at scale. If you want to give away books, giving them away with a published contract is really hard. And the reason for that is that the advance that they give you is exactly that.

6:25It's an advance. It is an advance against sales. And what they want from you is a salesperson. They want you to sell books. The whole goal of a big publisher is to sell copies of books at full retail value. Whereas an independent publisher, they are normally there to support the goals of the author. And they don't care whether you make retail sales so long as you're happy as the author. They're looking after you and they're trying to meet your goals. So a few things happen when you publish with a big retail publisher, sorry, big traditional publisher. What they're going to do is they're going to push you down the path of writing something that their data tells them will sell.

6:58They're going to try and get you to fill a large gap in the marketplace. They want you to do something generic and wide, whereas you may want to write something really specific and niche. So they won't encourage that. They won't sign you for that sort of a book. When you then give books away, they're going to say, oh, we'll give you a 10 % discount if you buy hundreds of them off the£10 cover price. Whereas an independent publisher will say, we'll give you cost plus a small margin for us to organise it. So you can give away books much more cheaply. What I discovered is that it is so time consuming trying to sell a book.

7:31To convince someone to part with£10 to buy your book is so much of your time, right? It's a ridiculous commitment of time. But the opposite is like going out there to give books away and to say, hey, I'd love to meet you. Here's a copy of my book or you're the type of person I wish I had time to talk to. Here's a copy of the book. So, for example, my latest book, Scorecard Marketing, I printed up 10 ,000 copies of that and I just gave them away to thousands, well, 10 ,000 entrepreneurs. You know, essentially any entrepreneur who fits my target market for ScoreApp is exactly the type of person I would love to have a cup of coffee with.

8:05I can't have 10 ,000 cups of coffee with people. So I just give away 10 ,000 copies of the book. And then the business scales off the back of that. So, you know, it's a different strategy. It's a different mindset. I've done both. But my preference is actually the non-traditional independent publisher. Got it. Great answer. Thank you. It is a time consuming process though, right? As in, you know, I suppose you have to be very disciplined. You're going to be spending time reading. I would just turn that into writing time. You're going to spend time commuting, just pull out the notes app on your phone and just write some chapters or some introductions to chapters.

8:37It's actually quite relaxing to write. It is cathartic, it's therapeutic. It's a great meditation when you actually write down your thoughts and your ideas. It takes you into a different world and if you've been stressed about other things, it actually takes you into a different project. If it takes you 18 months, so what? It takes you 18 months, but you get a book at the end of it. You get a new significant asset. You've now got a book on Amazon. You're an author. No one can ever take that away from you once you're an author. You've written a book. So you're going to be spending time doing something over the next 18 months.

9:06Why not chip away at a book? All right. That's it. It's convinced me. This time next year. Scorecard marketing done better by Dan Murray-Zurta. I'm totally fine with that. Go for it. Okay. So what's the last thing you bought for yourself? Why did you buy it? And do you recommend I buy it? I'm not really a thingy person. I could very happily survive with just two suitcases. I have everything I want or need times 10. So really the stuff that I buy, the significant purchase I made recently was 10 coaching sessions from a business coach who I look up to and respect and admire. It's a guy who sold his company for over 150 million and learned a lot along the way.

9:50And in particular, had partnered with private equity to do a lot of his transactions. And I wanted to get that specific domain knowledge. It was great. I was very expensive, booked 10 sessions. And it's been wonderful, been really, really good. I'd recommend it. I've just done the same thing. I've just splashed out for myself on a single session, but a single session with someone that I really look up to admire, had loads of questions and just thought, you know what, I'm going to guess this for the next year, I might as well just save myself. That is the definition, I think, in entrepreneurship of time is money.

10:18If you can save up and afford the thing that actually is going to save you the time to get you to the next level you might as well just spend it and do it and it's quite a freeing thing because once you've done it once you realize how uh intelligent a decision that actually is because you can psychologically talk yourself out of it logically very easily right but it's actually proven to be already valuable to me and i'm hoping exponentially so i think there's something magic about paying for someone who is further along than you by virtue of the fact that you're paying means that you'll exercise more discernment and it means that you're likely to act upon the advice.

10:54So you're not going to listen to anyone because you're not going to just pay anyone. And if you are going to pay, you're going to do. You're going to act off the back of it because it'd be too painful not to. So there's something pretty magic about that. And in the same way you might hire someone in the company to do a job, hiring someone who's achieved the result that you want and has been able to talk about it sensibly, as you say, it can save you 12 months of heartache. And in my case, I think it already has. Would you rather grow 10 great startups or build one unicorn? Definitely, definitely one unicorn.

11:24Yeah. Well, a unicorn is a great startup that was in the right place at the right time with the right funding. So it's not like you can choose to grow a unicorn. You can't sit there and say, oh, I'm going to do a unicorn today. Hmm. Should I do a little lifestyle business? Should I do a fish and chip shop or should I do the next Google? Obviously, you've got to be in the game to do something that scales and that becomes very valuable. But realistically, a unicorn is a great startup that had all the right things, you know, market conditions and funding, you know, at that time, essentially, you get the exact you put the same inputs in, but you get a much bigger output because you are lucky.

12:01The reason I would love to do a unicorn is because I'm doing the work anyway. So if it was in the right time in the right place, why not? Why not get 10 times or 20 times the result for the same effort? Very fair. So what's the worst business advice you hear people give to founders? So probably the worst business advice is just quit your job and go start a business. Starting a business is something anyone can do theoretically, but realistically, there are a number of steps that normally would come first. And one of the best steps before starting a business would be to go and work for another founder, to go and do one or two years in a small business where you work at arm's distance from a founder who's already growing a business and who has a fast growth business, especially if you've previously worked in a corporate.

12:44If you've been working in a corporate, you have no idea how lucky you are to have a brand and channels of distribution and a sales team and an IT department and all of these things that make that corporate work and 100 years worth of development that's gone into it and all of that origin story that you just completely take for granted. And then you go off and start a business and you go, hey, well, this is a lot harder than I thought. You need to do a year or two working in a company that has less than 12 people. When a business has less than 12 people, you can pretty much see what every single person does.

13:18You can see the dashboards. They're very transparent little organizations. You need to have a look and actually be hands on with a business that does a couple of million of revenue rather than a couple of hundreds of millions or billions of revenue if you've worked in the corporate. essentially people who just start companies without any training they're just assuming that the founder skill set is just a completely basic set of skills it's not a basic set of skills it's a very advanced set of skills to be a founder you've got to juggle a lot into existence so assume that you don't have those skills if you've worked in a corporate so secret leaders started in 2017 and in many ways we're kind of early to the podcast scene because you know now everyone has a podcast and when I tell people I have a podcast I feel everyone just rolls their eyes whereas in 2017 people like oh that's cool I hadn't heard of that before is that a thing back in a very early version of Secret Leaders where I was just sort of recording some mates in boardrooms to see if anyone would listen episode nine enter stage left famed entrepreneur and author Daniel Priestley walks in and gives us a little masterclass of his life and lessons up to date so what I don't want to do in this episode is rehash a bunch of stuff that that was your story then it's your story now and you'd already written I think three books by that time so no worries on whether your narrative is better now or then you'd honed it pretty well obviously for some guests I might be like yeah you probably don't listen to that old one that was garbage then they've got a lot better at public speaking with you not so much the case has stayed at a consistent high level from then till now so instead what I want to talk about is um is where you are now like what have you been doing since then and really like how has your perception of entrepreneurship and what what skills entrepreneurs need to survive in this world like how that stuff has changed because entrepreneurship you know entrepreneur revolution obviously the first book and I think there's even a mention of artificial intelligence in that book yeah now if you'd have written that book today my first question is what would you be talking about?

15:20Well it's funny because I am actually signed to rewrite the book so the publisher has asked me to do a revised edition in a post-AI world and to address some of the things that have changed. Isn't it incredible we spoke in 2017 it feels like forever ago right that feels like just an entire world ago the pandemic happened and technology changed things and businesses all went online and there's been an entrepreneur revolution when I wrote the book Entrepreneur Revolution, it was a weird idea that everyone would be an entrepreneur, that people would have side hustles, that we would have global small businesses.

15:53I talked a lot about AI in 24 Assets and Entrepreneur Revolution. I was an early investor in one of the first AI companies called Copy.ai. I bought the artwork that's hanging behind me here, which is an AI robot that was one of the very first AI robot artists that has traveled all over the world, has hung art in top galleries. It looks like something my daughter did at kindergarten. I'm sure you didn't just rip her off. It was an early stage. They're getting better. So I have this passion. There are certain things that won't change about entrepreneurship. So the entrepreneurial journey is actually quite predictable.

16:26And people think of it as an unpredictable journey, but it goes through a set of predictable steps. And the sooner you can go through those steps, the faster you can build a business. So, for example, in my household, we play with a lot of Lego because I've got young kids. and if you follow the instructions as frustrating as that is and you build block by block and brick by brick, you end up with exactly the same thing as the front of the box and it looks incredible and you feel proud of it but you end up with something that is correct. It actually builds out. It's the same with entrepreneurship.

16:56There are a set of steps and if you follow those steps, you actually build out a business very rapidly. So I'll quickly run through some of those steps. There is ideation. Ideation, there is actually a process between coming up with a good idea and a bad idea. There are principles for good ideas and principles for bad ideas. There are ideas you should go after and there are ideas that are just silly ideas or bad ideas. And it's great to have bad ideas. The more bad ideas you have, the more good ideas you'll have. In the same way, the more bad songs a songwriter writes, the more hits they're going to have.

17:27So there is a process of ideation, of coming up with ideas and finding the right ideas and testing the right ideas. and then once you've got an idea there's minimum viable product where you're going out and seeing if you can build an audience and see if you can get signals of interest from the marketplace and see if people will put down a small deposit or if they'll join a waiting list and you can do that without spending a lot of time or money or quitting a job or any of those sorts of things so minimum viable product testing is a is an exceptional skill set after that there's something called product market fit where the marketplace loves what you're doing and they say two thumbs up we want you to build this we want you to go with this and actually every time you go out and sell it you don't get refunds you don't get people complaining you get people loving the product and referring the product and saying that they intend to buy more or refer more so you've got product market fit after that you've got go to market where you actually fire up all the jets and you build a sales team and a marketing team and you run ads and you do seo and you tell the market at what you're up to and you shout about it from the rooftops and you're actually trying to scale the business up.

18:34You're trying to get the business really going up, you know, going to market. After that, you then scaling where you're trying to go into multiple territories, multiple markets, and then you're either exiting or you're acquiring, go into that next more mature phase of business. So there are these predictable stages that you go through. Each one has its own disciplines, its own suppliers, its own best practices. And what we need to start doing is looking at entrepreneurship as a series of predictable steps, much like the aviation industry. In the early days, it was trial and error. Some people got off the ground, but most people didn't.

19:11We need to evolve to where it's really predictable that businesses get off the ground, they become successful, and they grow and they develop, and that people are giving it their best shot and following best practices in order to succeed in business. So I teach entrepreneurship, I've got an accelerator, I lecture as a guest lecturer at universities around the world. But also I build companies, I've built several different businesses, I've launched about seven different ventures that have gone zero to a million in their first 12 months, I've done three businesses over 10 million of value. Most recently, ScoreApp has gone from an idea to a 20 million pound business in about two and a half years, multi-million pound revenue, decimillion valuation.

19:51And how did we do it? We just followed a set of steps. And we actually genuinely went through and started following steps. So specifically, we tested the concept, we tested the audience, we got the offer right, we sat and did face-to-face sales with our customers and understood why they buy, what their fears are, what their concerns are. Before I built the technology, literally sitting side by side, shoulder to shoulder with people, talking to them about making a purchase and selling to them before we even tried to formalize a landing page or a video or any of that sort of stuff. I did probably a hundred sales meetings.

20:28So I went through those steps and then we went and perfected the pitch, raised a little bit of money. I wrote a book that would allow it to scale. I then built a product ecosystem. So these are actually, when I rattle these off, the reason I can rattle them off is because these are the steps and we just went boom, boom, boom, boom, boom, boom, boom, and we followed those steps. Mind you, this was also a side hustle. This is not my main focus. I've got other businesses as well. During that time, we did a couple of acquisitions in the other company that is at a more mature level and is growing through acquisitions.

20:56There was also an exit. I sold one of my companies during that period of time as well. So you could say, oh yeah, this is very academic, but this is actually also real life. I practically, and I go through these steps one at a time myself and do predictable buying and selling and exiting and growing through some playbooks. How did you go through an idea process and why did you land on ScoreUp? How was that your best idea? There are certain ideas that you just keep coming back to. You can't put them down. And you park them and you put them on a little notes folder in your phone and you kind of add to them.

21:32And you think to yourself, I shouldn't be doing this. I've got plenty of other things to do. But you just get pulled back to this idea and you keep getting pulled back to it. So in about 2015, I launched an online assessment. It was called the Key Person of Influence Assessment. It went with my book, Key Person of Influence. And essentially, when people would open up the book, it says to get the most out of the book, take this quiz, answer 40 questions, and it will tell you where you need to focus your attention and you'll get the most out of the book. About 90 ,000 people ended up taking this quiz and about 15 million pounds worth of sales came directly from the quiz.

22:04So it was just this online pre-qualification, self-qualification, self-assessment tool that we built. It cost about 10 grand to build. It was about six weeks worth of planning, writing, developing, and then coding it into WordPress. But it was so worth it. It was one of our most successful campaigns. And it went on for year after year after year. For five years running, it just kept delivering warm, qualified leads every single week. And we would give away a copy of the book, Key Person of Influence. People would open the book, read that they should do the quiz, take the quiz, read the book. And this became our scalable sales methodology.

22:39And it worked for a training company. And pretty soon, a few people cottoned on to this. And our client said, can we get one of these as well? And we used to build these, custom build them on WordPress. It worked really well for any service company where people have to almost self-diagnose whether they would benefit or not. Coaches, consultants, IT people, fitness people, relationships experts, all of those types of people, you know, these online signature assessments that you can have. So I got excited by the idea that it had worked well for us. And I kept talking to Steve Oddy, my co-founder at ScoreApp, maybe there should be a scalable platform.

23:17Like, can you do this on Google Sheets? Can you do this on Typeform? And we're saying, well, you can do elements of it, but you have to have your landing page on one place and you have to have the quiz somewhere else and then you have to marry it up with dynamic results and a pdf report that comes out and by the time you do that you've got to cobble together five or six technologies and it's actually time consuming and expensive oh we kept coming back to the idea someone should just do this platform like it need then there should be an easier way to do this and then we kind of went well maybe we'll build an easier way to do this and we started messing around with the platform and we scoped out a plan and the plan was landing page data capture dynamic results based on the data and a PDF that writes based upon how you answer the quiz.

23:59So we basically built this as a platform with ScoreApp. And for two years, we went out and took this to market and told people about what a great tool it was. Signed up about 1500 people, maybe 2000 people. And it became, you know, pretty decent little software product and people were loving it and building leads and all this. But the biggest complaint was it takes hours, used to take weeks but now it takes hours to do one of these five hours to ten hours and then ai came along so we plug in ai and suddenly it takes five minutes to build all of this and the ai does all the coding and it does everything that you need and it selects the images and it puts it all in the right place and it's like whoa so now we've got thousands of clients uh at last count i think about 3 700 clients um have come through and there's like something like a thousand on trial this month.

24:48So it's growing exponentially, but it's kind of like an AI powered quiz engine. Let me tell you why I knew it was a good idea. It's recurring revenue. So you sell it once and then it becomes a valuable tool and people want to keep buying it every month because it's working and delivering value every month. So the recurring revenue nature is a good thing. So I knew that it was a recurring revenue business. I knew that it would be sticky with clients. I love software because I love any business where scale is decoupled from costs. So as you scale the business up, the costs don't rise in lockstep.