Strategic Business Advice That Applies To Every Business | Ep 840

25:28for fitness trainers, et cetera. And there's usually some component of, you know, two times a year, three times a year, they get to meet up. And beyond that, I don't think you need a huge amount more delivery besides whatever kind of one-to-many thing that you're doing. If they have at$600 a month, it's not that hard to justify, but that's what continues to stack. Would you almost look to reduce the price point at some point when they're in the programs, like the way we structure the moment? I'll go big head long tail. So like 3k down 600 bucks a month after that. So we do something similar. We do like an accelerator for like three, four months where they pay upfront, like a big chunk and then like a lower price.

26:09I prefer pay and then pay immediately. So it's like, rather than, you know, like 5k, I'd rather get as crazy as it sounds, I'd rather get 3 ,500 and then have them pay 500, three times in a row, whatever the math works out. Yeah, that works out to 5K. I would rather that because I don't want to have a second sale for Ascension because then I'll lose whatever, you know, conversion percentage. So I'd rather just get like 3 ,500 year invested. Now we start at$500 a month. Does that make sense? Yeah. That's sort of what we do with our highest ticket program. Great. Does that one turn less than the other ones?

26:41Yes. 95 % retention, like year on year. But then I think that's also the caliber of person we're dealing with has less of a financial obligation. When you pay$3 ,500, the$600 doesn't seem that bad. That's what I would do. I think you're doing fine on the advertising side. $1 ,400 tax fine. If anything, it's good. So I don't think you should obsess on that. So literally just try and pull, I try and average is, I think, like 13 % last few months, which is way too high. You got to cut it by three quarters. That's where you attack. Part of it is going to be a pricing thing. Part of it's going to be expectation setting the onboarding call um and sometimes a little bit of is the marketing and what they're how they're getting sold as in like overselling yeah and also probably just customer avatar like making sure that you're not taking people who want to start uh you know fitness training businesses but people who already have training businesses so that's the challenge we found is that a lot of say from the ad traffic comes through from the beginners rather than we had a lot of people at the beginning who advanced you came from my organic warm audience yeah and they're the better saturated that yeah so you disqualify customers okay so it just means that you don't take some people's money cool and if you if and if you tweak the marketing so that the messaging is clearer you will attract more of those people just being like this is only for people who and then you keep going into the ad you'll get more of those to be more clear in the ad narrative in terms you must have these things in order to do it.

28:12If not, watch my free show. Okay. Cool. Awesome. Thank you. Yeah, you bet. Rock and roll. You know, this is a business that is very sales and marketing driven, but if you want to get really big in that world, really any world, you have to keep customers. And so that business, you can either sell more customers year over year over year, knowing that they're going to fall out the back or just take the extra year or two and fix the churn in the core thing. Now, my caveat is that will you ever eliminate churn in that business? No, but you can dramatically reduce it. It's not going to be the same as a CRM business, right?

28:48It'll just be worse than that, but better than what he's got, right? And so that by fixing it for a year would then allow him year over year over year to have consistent growth rather than always having to be worried about where his next ad campaign is going to be doing. It gives more stability in the business, increases cashflow, increases margins, and fundamentally just makes to a more enjoyable business. Hey, Alex. Thank you. This is an amazing couple days. Awesome. Thank you. Thank you, guys. My name is Joel McDonald. We sell a travel coaching program. We help travelers. I don't know. 40 sales a month.

29:24You did 150 sales in December and had a record month using the Black Friday play doing a giveaway. Yes. Yeah. And then you got the bigger group that's happier revenue doing$180 ,000 a month. 6 ,000 members at 30. Right. Exactly. And then you have your higher ticket. Okay. Yeah. So that we feel very good about, especially now we've got a lot more clarity. We're on trajectory to hit 10 and actually a lot of clarity to hit 15 million this year. Cool. The biggest thing, and it's not necessarily what's stopping us, but what has us really nervous is we've kind of got all of our eggs in one basket. And that's our, you know, we're 95 % dependent on meta advertising, which works great.

30:09We've got it pretty under control, but that could disappear at any moment. My thought is diversification. I mean, we could do other paid channels. Those are a lot more expensive. I'd like to diversify a little more with affiliates. That represents about, we've got an aggressive program. It pays$5 to$7 per click. Oh, right. But it's like 1 % of our revenue. what you've you've done reels and topics on you know creative ways to do affiliates uh a do you think that's a best way to diversify and b if so what are some out of the box strategies to kick start that big picture you'll never feel like the business is solid until you find out how to get people to not leave.

30:58Everything else is window dressing. In terms of acquisition, I would rather you go from paid meta ads to adding in paid YouTube ads than trying to go a whole new method for affiliates or a whole new method for content as like your primary kind of like new investment. And so I would probably just go YouTube ads as my kind of like next thing. And you're knocking on the door of a million a month. So it's about that time. Does that make sense? Cool. That's what I would do. All right. Thank you. Easy peasy.

31:33So this gentleman trying to go from, you know, six million to over a million dollars a month. So he's right here, right? And his current constraint is that lead flow is volatile because he only has one way to get customers. And so to graduate, he has to fund his second acquisition in general with for what I like doing. And he actually just ran the play. And so when I started this, I was like, you just ran this referral process play, which he had just done to generate more cash flow and then segment long-term lead nurture by lead scoring. And then pick the most similar platform, which in this instance was go from paid ads on meta to go to paid ads on YouTube.

32:09And so that was the most similar thing that he could do to get more customers. And so fundamentally, that's all I did was basically walk him through what his current constraint was, how to graduate for it at this level. And if you want a personalized version of this to know exactly where you're at and know what constraints you have and how to graduate, this scaling ramp is absolutely free. Just go to acquisition.com forward slash roadmap. And on the thank you page, if you'd like to have my team tell you where you're at and kind of apply this to the business rather than having just kind of like the automated thing, then book a call.

32:42We'd love to meet you. Otherwise, enjoy. Hi, I'm Mauricio. I sell corporate training focus on soft skills to large companies. Who learn soft skills? What? You help who do soft skills? I train companies in soft skills. Okay, got it. Leadership and coaching, etc. We do 1.3 million in revenue on a project-based model. I would like to be at 100 million subscription-based model. and what's stopping me is a project-based model is more lucrative so i feel like stuck with these whales okay that doesn't want the subscription model so project based isn't bad you just need to demonstrate so this is the concept of recurring versus reoccurring right and so if you go project to project there's nothing wrong with that as long as you can demonstrate that you have a high renewal rate between those things.

33:36And so I'm in general, I do like having kind of project based stuff, because typically, you can price two to three types higher than you can for a subscription. And so you have usually way better cash flow, because people are willing to commit to a certain amount for this period of time, versus, you know, this forever, which is what a subscription feels like, even though realistically, we know that it's not that that that case. So you want to get to$100 million subscription business, you have a$1.3 million non subscription business, I would say I don't think the limit to your business is that so we have to dive a level deeper and say like what's stopping you from getting to 10 million with your current model yes we are now aiming to to smaller companies on the subscription base and the whales are staying the same basically so that's our strategy to like this year we're aiming for a 40 % of subscription, subscription based model from all the revenue.

34:4340. 40%. Yes. Is subscription already or that's the goal? No, it's the aim of this year. Okay. Got it. And you said you have whales. Yes. And you have small companies. Smaller. Yes. What percentage of companies are in either bucket revenue wise? Nowadays it's like 80, 20. So the whales are almost everyone. Just do more whales. Okay. I'm serious. So how do you get whales? We have an outbound sales team. Okay. And we are pretty good at it. So we get into a whale and then sell it to more departments. Yeah, of course. So what's the limiter on your outbound team? People. okay yeah hr hr is so recruiting yeah okay got it so if you had twice the outbound team you have now with equal skill would your business double yes great so what stops you from doing that you don't have a recruiter yes but it doesn't work okay so you have a bad recruiter yes okay so hopefully this like line of reasoning was fun for everyone um but that's what we have to work on like you don't like the rest of the stuff that we talked about is basically irrelevant you need to go get another recruiter who's good and can get you outbound guys basically and you will continue like my advice is to continue increasing the outbound team until you can't handle the sales anymore okay that's it and whales and whales fundamentally like it's not uncommon for them to be work on projects for just extend the terms so if you if you sign you know they're current doing six month engagements try go for 12 or 18 month engagements okay does that make sense yes Yeah, and that's just as valuable.

36:30Like if you have like a five-year contract with a Fortune 500, it's recurring. As far as like an investor would be concerned, it's the same thing. Make sense? Yes. All right, rock it roll. Hopefully it's simpler. Hey guys, real quick. This podcast only grows from word of mouth, quite literally. There's no other way to grow a podcast than word of mouth. If there's some element of this that you think somebody else should hear or would be relevant to them, it would mean the world to me if you shared this via text, via Instagram, via DM, Whatever way you like to share stuff with the people you love.

36:57Thank you. Yes, sir. Hi, Alex. Hello. My name is Don. I sell Christmas light installation to home and business owners. Love it. Last year, we did$450K. Sweet. And this year, I'd like to be at$2 million. Awesome. What's stopping me is that I still have prices when I started the business two years ago for some businesses or for some clients. Sure. So I'd like to know how can I increase the perceived value so that I could increase my prices while still doing the same thing? Can you just say a higher number when you get to the asking for money part? So for example, if I've been charging a house$1 ,000 for an install and takedown.

37:44No, I understand. I'm saying like what stops you from just changing nothing and just saying a higher price? like this year it'll be 2000 yeah i guess nothing but um the perceived value that feels like the easiest thing to do yeah so i wanted to know like if there's a script or anything how okay so a couple things so one is that it feels like you need to be sold more than anything which like great um but are you good at it good at sales no no christmas tree lights oh yeah okay good the best. So great. So then you can, you can charge whatever you want. Um, in terms of it has the business all come from referrals, uh, from Google leads and, um, referrals.

38:29Okay. Got it. So you want to get to 2 million, uh, you raising your prices, what percentage do you want to raise them? Probably 50%. Okay. Got it. So the thing is, is like, if you want to raise them 50%, I'll bet you got so much more room than that because you seem not as convicted. So I'll bet you there's like a ton of room. Okay. So you're charging, okay, let's just, let's start with 50 and then bump it again another 50. If basically you have no change in close rates and I would like you to keep bumping it by 50 % until you see that you're making less money. Got it. That sound okay. It's that simple.

39:04Okay. That sounds great. I love this. Is that as good for you as it was for me? I'm kidding. That's what your partner said.

39:15There you go.

39:19That was a no joke. Thank you. That's also what she said. So the, okay, so I'll give you a little script for the people who are old that are going to come back, because I know some of them are going to recur, is that I would give them a heads up ahead of time and say, hey, just so you know, we're raising prices on all these new crazy people who are trying to give us money. but since you're a new an old OG if you want to reward you for being a previous customer I'll honor your old price as long as you buy now for Christmas otherwise you'll get the new price so it's like I'm giving you the love now because I'm like hey I'm letting you in but then you can front forward you can pull cash flow forward that make sense perfect and then everybody else just raise the price and you'll feel okay about it because you'll have a full bank account.

40:09Right. Okay. Thank you. So pricing is one of those weird dogmatic things that founders have, these like deep-setted beliefs about it. And I think there's because there's a lot of fear, right? No one wants rejection. Everyone fears that their business is going to go away. And it's usually because you think that like, oh, if I change the price to one customer, everything's going to change. It's like, well, if you weren't selling, then you can just change the price back next week. But the risk of not testing your pricing is so much greater than the risk of keeping it the same. Like think about it.

40:41It is absolute extreme. If you kept your business prices the same forever, you would eventually go out of business. Think about how crazy it is because over time prices inflate, right? Costs go up. And so you have to be able to adjust prices. If you haven't adjusted your price in the last four years, you're making 30%, 40 % less profit for sure, bar none, in terms on a per unit basis. So like, why wouldn't you do that? And so with this particular guy, he wanted some like strategy to get his head around, you know, I want to charge more. And so how do we increase the value? But he's closing a ton of people and he's obviously doing a good job.

41:18And so the easiest way to price higher is to just raise the price. And I just gave him a little tactic, which is you want to reward existing customers. But the thing is you can reward them whatever you want. So you can reward them by giving them early ability to pay you. You can give them a discount for three months if it's a recurring membership. So it's like, hey, I'm changing the prices today, effective now, but I'm grandfathering you in for three months, right? Rather than forever, right? So as long as you give them some consideration, it kind of like smooths things out. And it's easier for a discount to go away than a price to go up.

41:52And so increase the price, give them the discount. say you grandfathered the discount for three months or six months, and then the price goes up. So what Don was struggling with is an issue that I cover in the$100 million offers book. So he was dealing with a virtuous versus vicious cycle of price. And so there's always this fear of like, okay, well, if I decrease my price, maybe I'll make more money. But when you decrease your price, you decrease your client's emotional investments, you decrease their perceived value, you decrease the results they get, you decrease, you increase their demandiness towards you, They're more of a pain.

42:22You decrease your revenue per customer so that you have less money to actually like do the thing that you delivered. You have less profit, less value for yourself, less perception of impact, lower service levels, and your whole sales team, which sometimes when you start it's just you, your personal conviction drops. So wouldn't it be so much better to increase their emotional investment, increase results, increase demandingness, increase the revenue for fulfillment so you can get better talent and have more profit, increase your own perception of self, increase the service levels you have, increase the impact and increase your own conviction?

42:55Yeah, probably. And so the thing is, is that changing your prices is the single easiest thing that you can do operationally that can make you more money. And you should always exhaust that as fast as you can before thinking about other things. Because literally the only thing you need to do when you raise your prices is just when you get to the end of the sale, say a different number. Hey, Alex, my name is Alex. What's up? Yeah. We sell residential window replacements to homeowners. Okay. We did 84 million in revenue last year. Residential. Windows. So homeowners. To homeowners. Okay. Got it. 84.

43:29Okay. Yep. Today we have had a Google Sheets empire. A what empire? A Google Sheets empire. Oh, Google Sheets empire. And we're starting to build out a HubSpot. We spent the last few months building out the frameworks of our HubSpot. Are you involved in it? Very involved. Okay, good. That's just like the biggest mistakes. So that's what I wanted to ask you about. Cause I know you just moved all your portfolio companies to HubSpot. Who said that? You. When? On one of your podcasts. Jesus. It's like every, it's like I say it on one podcast, like four years ago. It's like everyone, there's like the best HubSpot endorsement ever.

44:00Anyways, keep going. The question I have, so we're going to roll this out across 16 offices, hopefully a hard launch March 1st. Cool. I don't want to pay the ignorance tax if I don't have to. So what advice would you have? basically you just need like your CEO of IT for basically this whole quarter. It's the easiest way to say it. And so I would have really rapid feedback loops with each of the department heads. If you have functional heads at the holding company, and then you'd want to have basically separate lines of communication for all the location heads. So I think about, do you use Slack or something like that?

44:31Just Voxer, yeah. Really? Yeah. Jeez. Okay. Yeah. So I'd want to have basically different threads by function. So one is the actual function. So people who are handling sales, people handling marketing, and I'd have the leaders there. And then I still want like, you basically want the different slices, basically lines of communication to the different slices of the org, so that you can get as much transparency top down into how it's working for them and making their life easier. And then that way you can triage, um, basically which, cause you have limited resources in terms of which of these bugs are we going to fix?

45:05You know, which process flow sucks. Um, and then you can basically stack order, which of these things has the highest driver for revenue, but you can't really do it appropriately unless you basically can drink in all that, all that information. And as, are you CEO? No, I'm okay. Yeah. But, but you're in charge of it. So you're CEO of this. So, um, that, that's, that's basically, basically it's just like, you need to eat, breathe, breathe and sleep this stuff. Okay. No, that's helpful. Thank you. Yeah. Just like, it's okay that it is unscalable. Got it. But you have to do that in order to make it scalable.

45:40Yeah. Thank you. Yeah. You bet.

45:45Hi, my name is Julie Tiefteller and we sell travel coaching to people who want to travel more frequently and more rigorously for free or almost free. You already know all our business stuff. So my question is, kind of piggybacking on what you were talking about earlier with your six pages of ideas. We're in a room full of people that are always trying to optimize as well as always has new ideas. We had an idea for a B2B offer for adding a 50K concierge offer for businesses that are already spending half a million or more on travel annually. Um, so when is it appropriate to add a new offer while you're already like still working and optimizing your other ones?

46:28Sorry. I just wouldn't. You would. I wouldn't do it. Okay. You're going to go from six to 15 this year. Do that. Okay. Like I'm not, I'm not trying to be like a short to like, like these are, these are the mistakes that we make. There will literally always be money on the table. like you, you can't sell everything as much as you want to. Like you just, you just can't. And the thing is, is like, if said differently, if this company can go from six to 15 and the next year goes from 15 to 30 and the next year goes from 30 to 60, if you hit the same numbers and have two different product lines versus one, which would you rather have one?

47:11Right. And I'll also tell you that if you just do it with one, you'll increase the likelihood, not decrease the likelihood that that occurs. And so like, that's all the, that's the focus and discipline stuff that you hear all the Steve jobs and all that. Like, it's just, it's a, he called it the, uh, the quantity of unbelievable ideas that you know, you could crush that you say no to. That's what focus is. So how do you discern when to pursue something off of that six page list? Um, when we have bandwidth, which if you're continually like, if you're basically doubling every year, your bandwidth is getting eating up by doubling.

47:47So just double. Basically, it's like, why, why would we do it? Okay. Thank you. Yeah. But if it's like, I want to grow, why would I like, why? Like, then let's just grow with the thing that already is working and is really profitable. And we know everything about it rather than this, you know, crazy girl in the red dress that like walking by and like has a crazy boyfriend has crabs. You're like, what's going on? You know? So like, why bother? It's like, we have this girl. She loves us. She knows me. I know her. Let's go. I define focus as the quality and quantity of things that I say no to. And so if you think about commitment, the ultimate commitment is the elimination of alternatives.

48:29You have nothing that you can do besides that one thing. That is the ultimate, like the perfectly focused person who plays video games would do nothing but play video games. Everything that is not that decreases his focus. And so focus isn't like, are you focused or not? But how focused are you? Right? And so the idea is the more things we eliminate, the more focused we are. And so that is always my constant reminder, especially the Steve Jobs quote, because he's like, it has to be something that you want to do in your core, you know, you could crush and you still have to say no. Yes, sir. Hey, Alex.

48:59Okay. The Coaching Federation internationally, you have the certification, 18 people is the cap. How do get around it let's go so first of all thank you you and your team for the things that you're doing no you bet um yeah my name is paulis this is what i'm doing that you are said already uh and for the i guess three four years seems like i just kind of lost something like why or stuff like this because two and a half, maybe already three years ago, we planned to go from what I have right now because it's a one-man company, just few team members. Now it's 416 revenue the last year and the goal was 2.3 mil.

49:53Maybe this is the why. I lost this on the way. uh-huh um so i just wanted to to know what's your why why you are doing what you are doing i like working i'm dead like i spent a year thinking about that question when i had enough money to do whatever i wanted and just like could just live on treasury bills for the rest of my life um when i looked back on the days that i enjoyed most they had three things in common. I worked out, I ate with people that I liked and I worked hard and had something to show for it and had nothing left in the tank. And so once I realized that those were the days that I enjoyed the most, then I made it my goal to live as many of those days in a row as I could.

50:38And the way that I live my life bothers a lot of people and that's okay. And so I think, I mean, I got that advice when I was 22 years old from a person in my past. And I'd had a good weekend and I started work. And she said, you're in a good mood. And I was like, yeah, I just had a good weekend. She was like, I'm pretty sure the secret to happiness is living as many days in a row like that as you can. And that was like the closest to operationalizing kind of joy that I'd ever heard. And so I have just stuck with that. And I think that the things that bring you joy will change over time. but I think that structure of just trying to find what that perfect day is and living in as many days in a row as you can is kind of the way to do it that's how I do it you can do whatever you want fine yeah as a side note um for those of you who feel um like you have lost your passion for your prospect and I'll I'll give you a simple example like I used to sell weight loss to women between the age of 25 and 55.

51:46And at a certain point, I just really stopped caring. Um, they were like, Oh my God, my life changed forever. And I was like, I know you had a calorie deficit and you moved like, yes, that's how that works. And I would have to kind of like fake myself into feeling excited about it. And, um, I, it really bothered me because I was like, I quit my job to do something that I loved and I don't really care about this. I ended up loving business more than I loved weight loss and then I fell into that. Um, but I had a friend who was a personal trainer who quit being a personal trainer and started a cookie business, brick and mortar, big cookie store, like did it right.

52:24Um, and I remember being like, are you passionate about cookies? And he was like, not really. And I was like, but he crushed it. He did a really good job. Everything was like really tight. And, um, what I realized was that he was passionate about doing things well rather than the cookie business. And once I realized that I was like, oh, I don't have to be passionate about weight loss, but I can be passionate about being good and just saying like, when I do things, I will do them well. And I think that has been something that has helped me stay motivated in times when I feel less so. Paul had kind of fallen out of love a little bit with this business, which is, I just want to say, if you're an entrepreneur, I get it.

53:05And you're not alone. All right. Like it's, it's very common. You've been, you know, you can beat up for two years, three years, five years, you're trying to support your family. And you know, at some point you just feel like it's just the amount of crap that you have to do with on a regular basis. You almost just like, it's no longer romantic anymore. But the thing that really changed my perspective on this was leveling up the ideal that I wanted to be loyal to, right? So originally it was like, I want to be loyal to my interest in weight loss or my passion, weight loss and fitness. But over time, I just found new interests.

53:35And for me, from a forever perspective, I always want to be excellent. And so that becomes a hypothetical ideal that I can always chase and never achieve. So like, I want to be great at what I do and do excellent work. And so every day I can improve towards that ideal, independent of whether I'm baking cookies or selling weight loss or doing IT services or cybersecurity or coding for software or sweeping floors. It's a very trite statement of how you do one thing is how you do everything because I don't necessarily agree with that. But how you do the things you care about is how you do the things you care about.

54:12Hey, Alex. Hello. My name is Heather. I own a consulting firm called Channel Maven. We help large IT companies sell better through and with their partners. Revenue was 3.6 million. I sold it in 2021. Congrats. Thanks. ran marketing for the company that acquired us. They called it an aqua hire. Um, and convinced the board six months ago that I was done and they should give me the name back. So got the name, got the IP. I get to start over, not make the mistakes I made before the market has shrunk. So that channel role is being pushed out. Um, and when I started it, there were five consulting companies I competed with.

54:58Now there are probably 200. Do I focus more, like channel marketing is probably what I'm best known for. Do I focus more on that in this industry or do I go just B2B and like help kitchen and bath companies sell through dealers or automotive? When you say channel, yeah, explain, dial into the channel sales that you're talking about. Yeah. So a large IT company sells direct, but they also sell through hundreds of thousands of mom and pop channel partners or Accenture or now Marketplaces. So like affiliates? Yeah. Got it. Okay. So you're an affiliate expert for big IT companies and you have a network of people that can do basically sell their services for them with a markup.

55:40Yeah. I mean, I basically made an announcement on LinkedIn that I was back and did 360K in four months. That's awesome. Yeah. Thanks. So the question is, well, I mean, it sounds like you did okay with your announcement. um why do you feel like you can't out compete the other people um i just feel like my champions the the 14 000 people that follow me on linkedin are starting to phase out a bit and it's just gotten super crowded and this is the channel part so the crowded part doesn't bother me at all yeah because that just means that there's lots of demand my clients are the tech companies so hp google yeah so the 14 000 people you have a lot of high up people in those companies who follow you Yeah.

56:22I mean, you could do either path, but I mean, it's a good question. It was, I think it's, it's, I think it's more the statements that would initially jar me of like, it's saturated. I think it's going away, things like that. Because, you know, my, my, my big questions are always logic, evidence, utility. So what does that mean? Like define that for me. How do you know that? And so what? Logic evidence utility. So when I asked, you know, channel partners, like, please define that for me. It's like, okay, that's affiliates. Um, how do you know that they are going down? Like, how do you know that?

57:04They're all calling me asking if I know of jobs and I'm tracking how long they're on the market. And on average, it's about 11 months. Who's on the market for 11 months? They call it a channel chief. So it's like chief partner officer. Okay. And those people are looking for jobs? Yeah, because they're all, they're all getting let go. So then the VP of channel sales reports to the CSO, the VP of channel marketing reports to the CMO, like that level is just getting. And when you say a lot of people reached out to you, like how many is that? In the last year, because I was still in the channel when the company acquired us, I'd say probably 40 people.

57:43Okay.

57:49The big conflicting data point I have is that you like made a post and made 360 ground. Yeah. Yeah. So just shut up and focus. Yeah. No, I mean, it's real though, but I think I'll tell you what I like, if I'm in your shoes, I get excited by this stuff. Maybe because I'm broken on the inside. Who knows? But like, I am you, I work, I have little kids 50 % of the time. I work nonstop when they're not with me. Yeah. And like, I see everyone bleeding and I'm like, let's, let's finish them off. You know what I mean? Like they didn't deserve to be in business to begin with. And I will make sure that everyone knows.

58:22And so if you have this in and you're better and you're seen as a market leader, if things are consolidating, for example, then it means that like, as long as if the industry isn't going away, but it's consolidating, then it means a winner take all. So it just means the stakes got higher, which if you're better, that's a good thing. Awesome. Thank you. No, you bet. What Heather presented with is super important because a lot of businesses deal with this same issue, which is the perception that the market's getting harder and the perception that saturation has gone up. And those both may be true and so what, right?

58:58And so the thing is, is that like business pretty much always gets harder. And in the opportunities where you have in the sectors where there's opportunity, more fish are going to come, right? More sharks are going to enter. But like, that's not always a reason to not pursue it. It just means that you have more competition. You have to be better. And so in some ways I can see lots of demand as a big market to go after. And if you're good, there's just more for you. Now I want to be clear. There's a difference between consolidation and degradation. So a degrading industry would be like newspapers, right?

59:28They're getting smaller and smaller every year, but a consolidating industry is when the same amount of demands there it's just aggregating into fewer fewer customers and so given the fact that heather is better at high level deals with these bigger companies it felt like a good a good risk adjusted move for her to go after that kind of big pie because she already had a company she'd already sold it she had good connections there she immediately made a post and made you know three four hundred thousand dollars to me it's like, she's got a good reputation, obviously. Like it seems as though she's doing a good job.

1:00:02And so I have a hard time telling someone to start brand new in totally different industries, totally different spaces where they don't know the devil that's going to come. Whereas here, it's the devil she knows because she gets to harness the compounding benefit of being in industry for a long time is that you know how it works and you know how the game is played. And so if you look at some of the richest people in the world as people have just been in the same industry for their whole careers. And so it's really hard for me to give someone advice to be like yeah just change it hey alex my name is chris and i have a question about the business i'm starting um soon so i have no numbers right now for my background i'm a physiotherapist and chiropractor have a academy where i teach medical professionals in my own concept called crack and move and i'm doing social media okay and i invented a tool where you can crack yourself your back like a self-crack if you self-crack yeah more like a black roll fastger roll but really intense and good and you can use it as a customer for your own for your better posture and pain relief but also the professional for especially some small women have with some techniques problems you can go you're a big guy so when i want to crack you i have to yeah neither i'm small guy so sometimes it's really hard and i would like to know would you focus on one group for selling b2c for example just a customer for the problem solve of cracking themselves and with the posture program and everything or just um the medicals and i have the medicals also my academy with affiliate or both so you are a chiropractor yeah and you no longer have your practice um i can if i want i have a waiting list and but you have a practice yeah i have and then you also have an academy where you train other chiropractors yes in my concept yes and you also want to start a physical products business yeah because of skating because time you don't want to leave money on the table um so okay um

1:02:04what's revenue right now um with my academy i started one year ago and we have 500k so you just started it a year ago yeah why are you starting another business um because it's so some problems and i found out because i have a why not sell newspapers you know what i mean like sell orange juice people are thirsty i could right no i'm being because of my maybe a social media i have an audience i have customers who are a waiting list i have the problem that many people want treatment i can't give them so i built some specialists in the businesses yeah and you have a third business and it's a physical product it's a totally different business yeah but i have some partners in it will know so i just have to do the marketing and the development of the tool itself and i we already did it so it's ready to launch but the problem yeah it's maybe you know sometimes it's boring just to do one thing at once but in business wise maybe it's better what's your goal um um oh good question of course i want to make money um but of course uh i want to do very nice products who have a nice impact of the yeah but what do you want to have happen from that i think with the focus so that's the problem you want focus you want to do that by doing more things yeah and the problem is that's so combined to my brand so um i have the problem that i can't i have so many customers i can't offer them anything so i have limited time with my own treatments so i need time to develop uh some uh we have the academy sorry you have the academy though yeah but it's uh it's very hard to um to teach them my concept because it takes half a year so they can implement it in their own office so i i try to reduce this as a hybrid model with online and everything but it takes time because of the brand protection quality because i sent my customers and when my customers go to them i want that high treatment high end treatment and the problem is that the onboarding takes so long that the customers want the treatment and i have no time my the people i'm teaching need time to learn it and get expert in it takes time to build a big business yeah yeah i believe you uh yeah but the problem is the social media makes the the other um cast all the followers just yeah let me let me let me help for a second so sorry you're good man uh you're also like probably you know everyone's laughing but like you're probably one out of four one out of three of you here is in this exact same boat so hope so uh here's the thing the opportunity will only get bigger not smaller so the rush that you have is a rush to do a smaller version of what you want because if you get bigger on social media you will have more customers who want to buy your thing right yeah the problem is that the customers are now a little bit sad because they i have no offer for them oh no i have no i had nothing to sell anyone for years okay so point being thing is i don't i don't actually think i'm going to convince you i think you're gonna do it no i'm serious so i don't even know if there's a point you want to sell your thing you want to sell your widget yeah so what am i going to do more like the advice of focusing on just the professional you want me to tell you how to focus how would how would you're doing several things at once right what you're also doing i have acquisition.com yeah you just have all the so just build a team one business yeah you want to be ceo of multiple there's a difference between ownership i also own stocks and zillions of companies different businesses at all what okay product so your book is also different no so no you have no this is important this is good it's just for my so for everybody there's a difference between owning something and being CEO and operator.

1:06:15You can only really operate one thing. That's it. If I buy a stock in Apple, I'm an owner. I don't do anything, but I'm an owner. Does that make, do you get the difference here? Yeah. You're like, well, I'm going to be more. So like the, where you would get me if you wanted to was school. I'm the face of, but when I did that deal, I said, I will change nothing about what I do. So my regular day must remain the same in order for me to do this deal. I'm going to continue to make content. I'm going to continue to record stuff. And then all I'm going to do is point in a different direction. That's it.

1:06:51So the pointing is a copy paste on a link. Everything else remains the same. So I boil this down to what does this change about what I do? And so the reason that this is very difficult is that you're going to start another business and it's going to change what you do. Okay. So I'll sell the things I'm not doing in my daily business when I'm starting a different business. For example, the product, I'm just doing my marketing, the development I'm doing also. I did it. And everything else, so like targeting the group and strategies, I don't have any clue. I should not. So I'm here just taking the question.

1:07:27All right. I don't know what your question is anymore. I just want to like, Maddy, what you focus on in this part when you have a selling group. I would take your 500 medical people and be like, how do I go from 500 ,000 in my first year to 5 million? That's what I would do. You already have something that works. You already have a following of people who have this thing. If you want, you can sell through them as an affiliate base. Then you have one business. Okay. That's a good answer. Great. Thanks a lot. Yeah, I had no idea where this was going to go. But it seemed like this guy had a lot of stuff going on.

1:08:01This was a classic like entrepreneur ADD rush issue. And so fundamentally, I think the reason that entrepreneurs end up opening up multiple things is because we're all in a rush. We all think that like somehow an opportunity is going to disappear. So there's two things. Number one is that opportunities do disappear, but then other opportunities come. So there will not be a shortage of opportunities. If you know how, if you, the better you understand the game of business, the more opportunities will come your way that you'll have to learn how to say no to. There will always be opportunities. That is a promise.

1:08:29I don't promise often. You can take that to the bank. There will always be opportunities. The next issue is the timing around this, which is some opportunities actually just get better with time. And so I'll give you a perfect example. So if I say no to people introducing me to people today, and the reason they're introducing me is because I have a big business. If I continue to grow my business, the people who wanted to introduce me to these other people today will want to still introduce me to those people tomorrow. But I'll also unlock the people that now that my business is bigger, will want to also introduce me to even more people.

1:09:00So the opportunity grows by me not taking up the opportunity. And so the thing is, is that he's got this brand, he's grown it a little bit. And so he wants to basically monetize it because he's like, some people want to buy something from me. Well, welcome to advertising, right? But the point is, is that those people aren't going to go anywhere. And maybe if even if those specific people go somewhere, if the brand doubles, he'll have more people that'll come up. That's the new opportunities will present themselves. But the thing is, is that you have limited resources and bandwidth. And so we have to allocate that to the highest return opportunity.

1:09:32And if he, in the first year of a new business, does$500 ,000, probably very profitably, I would have a hard time being like, yeah, now a year later, let's start another business. And I only say that because I've only done it every other time in my career and made a terrible mistake. And I, it's just like, I'm so vehement about this particular mistake because I have, I have done it so many times. Can you hire a CEO for a business? Yes, but unlikely for a couple of reasons. So number one, he had a very small business. So the likelihood, think about it from a number standpoint, right? So let's say that he's got a business that does$500 ,000 a year, and let's say he's profiting$200 ,000 from it.

1:10:11Okay, so it's$200 ,000 in profit. What is he going to pay a CEO to go run this business? It's not even going to be a CEO. It's going to be like a manager, kind of. And so it's like, okay, maybe you can pay$100 ,000 a year for someone to do that. But then there's$100 ,000 a year that's left over in profit. But that assumes that that person's going to run it as well as he does as the founder. And that's unlikely. And so it's likely to have like a decremented performance. So like, would it be fair to say a 20 % decrease in performance? Yeah, that's fair. And guess what? Now it's break even, you make some money.

1:10:40So like, it's so small that unless you have a manager model that like is really built for that, like brick and mortar stores can sometimes work for things like that. it's unlikely to be able to find somebody who can take over like his influencer business but can bigger businesses hire CEOs sure but if you also look at the biggest business in the world almost all of them are still founder-led and I think that there's a little bit of pendulum right now that's kind of swinging from like professional managers to the people who are like the heart and soul of the business because the one advantage that you have as a founder is that you wrote the rules so you know why they exist and you know how to break them and when to break them and so when somebody else takes over they're like well these are the rules but they never derive them from zero And so if you know how the infrastructure was built, you know how to navigate it without messing up the business overall while still accomplishing the objective.

1:11:26So fundamentally, you make the system more adaptive because of your knowledge of it. Hey, my name is Joshua. I'm actually a chiropractor as well. I have a great product that I would love to tell you about. Self-cracking. yeah yeah yeah that's funny yeah uh yeah so me and my wife we run a family chiropractic center in the uk cool and uh our current revenue is around 750 where uh we'd like to get it to 2.3 perfect the model and then scale okay um this is what is currently my predicament so we averaged uh 48 new clients per month last year consistently from uh two main two main channels referral and facebook meta okay what was the split uh so it's 35 referrals 65 ads got it yeah and uh excuse me uh sorry i'm a bit nervous uh thanks you're 35 65 referral versus meta you did 48 customers per month yeah the issue that you have 750 you want to get to 2.3 yeah so my question and I think what's stopping me is determining where I should be focusing because we get great results for clients like they get but you know even if they have an amazing result like a lot of those clients leave which is fine and then they come back when they need us it's terrible yeah and I'd love to have more clients that stay with us longer term from like a membership perspective and when I look to our churn retention rates our gross retention rate is 47 percent and then our our net retention rate is 74 so once we've done expansions upsells and everything else it brings it up but we still lose a lot of we leave a lot of money on the table on the because we're losing you lose half your customers correct but you keep a little bit more revenue so you're talking revenue retention versus yeah so i'm like which one do i focus on do we expand the marketing and just keep pumping the machine because i literally feel like you i've got to a stage in my business where I'm still in the clinic.

1:13:32I'm still serving patients. I love my clients. But like, you know, even if they've had an amazing change in their life, like it's like you with the weight loss. Like I've got to the point now where I'm like, man, like this doesn't excite me anymore. Like I know I can help serve more people if I can just become more of the owner rather than the operator. I've stepped my shifts down from, you know, five days a week to like two now. And if you made more money, you'd definitely be happier. so not necessarily that was a joke um okay so you have a location you're doing 750 what does it cost to open a location we own the building well outside of real estate what's the cost to outfit the location oh outfit it uh so we so we're pretty lean like we outfitted our current one it was a hundred thousand okay got it what's profit uh we kind of keep it uh we've kept it low the last few years but we yeah it's like um it's like 13 okay 750 yeah so you need to fix that yeah okay so there's a lot of like you know owner's earnings and stuff well what's sde so seller discretionary earnings so what do you make plus the profit of the business uh so me and my wife we draw 100k uh-huh each no total yeah and you have 13 on 75 so another 100 so 200k on 750 yeah okay got it so whatever that's um 20 30 30 percent ish margins okay so you want to get to 2.3 why 2.3 because this is what we worked out for our build it like our practice we could if we were at capacity okay so that location can do 2.3 million okay so So the issues we have to solve retaining customers.

1:15:21Now, if you keep 50 % of customers, like if let's say you lose half your customers, you're one, but then after that they stay forever, that's fine. We just have, like, in next year, you'll double. If that isn't the case, then, and you lose half of those customers the next year and then half of those the next year kind of thing, I would see what we could do to improve that. that being said you're in a business that traditionally is marketing heavy it's kind of like weight loss because like people get fixed and then they're like yeah deuces so the the strategy that I've seen that has worked really well in the chiro space is basically going significantly higher ticket number one and number two niching down in terms of the different problems you solve.

1:16:04So this is like neuropathy, diabetes stuff, those types of like kind of segments and having more targeted advertising for those avatars and selling significantly higher price packages. And that's typically how those businesses will get to like a few hundred thousand dollars a month just with one like very small store. And so typically that model is a, you run ads for some sort of free workshop free dinners free whatever pretty much how we did we built our business okay like because we realized so then what's the ticket price that you're charging it's different based on the we sound 50 customers a month and you're doing 60k so the the average is around like it depends because every plan is different for the client so we don't just give like a here's your plan no i know but if i just did simple math i'd say 60 000 a month 50 new customers average customer is 1200 bucks yeah okay so it's not the same model because i'm talking ten thousand dollars right does that make sense yeah more yeah so i think you have to get niched down in terms of so like if you're doing all those things i think you probably need to add a zero to your price tag we're already the most premium in our light area like well then it won't change you'll still be the most premium okay and which one would you focus on them would you just focus on like just filling the front end or would you try and fix because you talked about like fix the chair and like get it to less than three like or would you double down on both like would that be well if you keep half your customers you're pretty close to three so again you're pretty close to three if you keep half your customers right when we track it it varies between three and seven on the depending on the month i mean are there things that you could do to improve it sure i think you have more of a model issue okay like you obviously can acquire customers and you're doing a decent enough job keeping them if we need to improve how much money this thing makes it's either a pricing thing basically it's an offer and pricing thing is that you need to charge more so that you can make more money and then once you have the cash flow then the expansion becomes pretty straightforward that goes for basically everyone like a lot of times it's like you know we're doing 20 percent and you have what i would consider is like a normal business it makes money we work hard but there's no like you never feel like you really can like get ahead yeah it's usually because there's some significant hole in the business and you're decent at both sides and i think that the issue is that you just you need to be making way more money okay which is i think you need to add more do you sell physical products and consumables not really do you sell like braces and orthotics in a care plan it will be based on like yeah we do adjustments massage it might be like traction whatever yeah so the the key is there's two two models that have worked really well one is where you basically upsell them some sort of machine that they can take home and do other work and there's a big markup on that um and the other is uh supplements because you can sell a year's worth of supplements or six months worth of supplements up front make a really good um bit there and it doesn't increase your operational drag at all because you just make the sale give the product.

1:19:20That makes sense? Yeah. But that's what I would add in to justify the higher price so that you could make more money per customer, which will then make you more money overall, which then fixes the model, which then allows you to scale. Gotcha. That makes sense. Yeah. Cool. Thank you. Rock and roll. All right. Thank you. So he's kind of at the five getting to 10 employees. So he's at stage four. And so if you look at his product, he said yes to anyone who would pay. And because he's getting feedback for so many different customers, he has creates too many different products and services. There's basically too many different things.

1:19:52And so what I wanted him to do was get really clear on a higher level avatar. So specialized product and price to serve niche down customer. So I talk about the neuropathy and diabetes and kind of like thyroid. These are all like kind of sub segments that allow a chiropractor to charge much higher rates. And so we had to reconfigure the offer and the avatar to charge more and then ultimately make significantly more profit for the business. Now, he had a decent, you know, marketing and sales machine. And I would say he had a decent delivery machine. And as a result, had decent margins. And so all we need to do is just change the offer.

1:20:30And we could probably double or triple the business from that one move alone, which then opens up cash flow to then hire the people he needs to then be able to expand because at his current profitability, 13 % margins after you have a manager, essentially, you know, it's not a, it's not a compelling model and that's with him running it. So, you know, if you spend a hundred thousand dollars and you make something that makes$90 ,000 with you running it in profit, not including the manager pay, which he was taking personally, it's not a super compelling model. And so we had like, what you'd want is like you pay 100 and then it makes like 400 or 500 and you're like, this is a model.

1:21:06And that kind of cashflow allows you to scale. So that's what I wanted to get to. And I think honestly, if you just does that one thing, you could easily add$250 ,000,$500 ,000 to the business with maybe half that drop into the bottom line. Now you have a much more interesting business.