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BigDeal by Codie SanchezBigDeal by Codie Sanchez

Business Expert: The BEST Way To Make Millions In Profit | Mike Michalowicz

My new book Own Or Be Owned is out now! I wrote Own or Be Owned to answer one question: How do you make more money, less miserably?

Mike MichalowiczguestCodie Sanchezhost
Oct 7, 202555mWatch on YouTube

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Transcript

  1. 0:00 – 0:51

    Introduction

    1. MM

      You're not generating $10 million doing your one thing. You haven't arrived yet. You're not good enough yet.

    2. CS

      This episode is with Mike Michalowicz, who wrote the book on profiting first, and is going to teach us step-by-step playbooks for you guys to profit and make money right now in your business.

    3. MM

      To have a successful business, there, there's an intersection of three key elements you have to nail. What sales does is it can bring in more cash, but also brings in more organizational stress. You have more responsibility now. Where customers will never say to your face, "You know, your business kind of sucks." But what they will do is go online and slam your reputation. So you can't trust their word, but you can trust their wallet. I got a magical Jedi mind trick question. I guess I got two that will blow your mind away. First question.

    4. CS

      We've been blown away by how fast this show is growing. Like, getting to hang

  2. 0:51 – 2:00

    Reclamation Services: Turning Struggles into Success

    1. CS

      out with you every single week is so cool. But most of the people who tune in every week still haven't subscribed, which is crazy. It is the simplest way, though, to help me, us, keep scaling, bringing the best guests like Mike Michalowicz, and making The Big Deal a big deal. So I can't thank you enough for your support. Like, we would be nowhere without you guys. And I just want to jump back into my conversation with Mike, but I also want you to do it subscribed. Oh, and share it with a friend if you like this episode. I think it's better when you profit together, you know? Can I start with some, like, kind of real challenges, rapid fire, that we've heard from owners?

    2. MM

      Yeah, throw them at me.

    3. CS

      Okay. What if you're a business owner, you're weeks away from running out of money? You're kind of panicked. You don't know what to do next. What's your first move if you call Mike?

    4. MM

      All right, so first thing is you acknowledge you're pretty much every business owner on the planet. There's a, there's a saying that most businesses are on the brink of failure. Um, and the statistics show that most businesses don't have enough cash flow for four weeks. Um, but my analysis, and I love contrarian thinking, my analysis is most businesses are not on the brink of failure because

  3. 2:00 – 3:50

    Maximizing Revenue and Cutting Costs

    1. MM

      most businesses find a way to survive that moment. Somehow, some way, most businesses, yet again, doggy paddle and get above water. So I think most businesses are on the brink of success.

    2. CS

      Hmm.

    3. MM

      It's just a good strategic move. So what we do, if a business like that calls, and I also invest in businesses, we do what's called reclamation services. We go into businesses that are specifically in struggle, is we go through the client base, we deploy the Pareto principle, 80/20 rule, identify who the best customers are and say, "Hey, what can we do right now to serve you?" 'Cause they're already the best customers. We get revenue in that way. We usually cut the lowest 20% of customers because inevitably they are costing you money, and you don't even see it. It's like, "Oh, it's, I'm making revenue. This is great." The expenses are in excess of the revenue, and the emotional, you know, the emotional weight is killing you. So we get rid of the unfit customers, we amplify the best customers, then we start realigning the business around that.

    4. CS

      I love it. So y- two moves. You call up your best customers and say, basically, you're, you're, you're asking them, but not this way, "How can we sell you more things?"

    5. MM

      Exactly.

    6. CS

      Which is, "What else do you need, and how do we increase the LTV of every single person?"

    7. MM

      Yeah, you tell them you love them. Like, when you tell a customer, "Hey, you're, you're such an important customery, uh, customer to me. I value you so much. I just want to see if there's any other way to serve you."

    8. CS

      Yeah.

    9. MM

      Reciprocity kicks in. They're like, "We love you, too. And, you know, we were thinking about getting this. Can you do it?" Yeah.

    10. CS

      Love that. Okay. What do you do for someone who has more revenue than they've ever had before, but is actually making less profit?

    11. MM

      That, again, is every business I know. It's f- I was speaking yesterday at an event, and I asked the group, it's a similar size. I said, "Who wants to increase their revenue?" Everyone's like, "That's, that's what we need to do. That's the solution." I said, "Arguably, that's one of the most dangerous things to do because it's a reckless belief." We believe that sales cures everything, and that is

  4. 3:50 – 5:13

    Client Prioritization and Revenue Quality

    1. MM

      total nonsense. Total nonsense. What sales does is it can bring in more cash, but also brings in more organizational stress. You have more responsibility now, more things you need to service. So when a business says, "We're cranking up revenue," I am looking to see, are they doing it through diversifying their offering, which I think is a mistake. Instead of becoming special, they're doing many things, and they dilute their ability. They're not efficient. Um, we'll look, are they serving customers with, with varying demands? Uh, customers that are perhaps big names, but then they, uh, assert their strength. I, I, I had a client of mine I worked with. Walmart was their best customer, number one in revenue. We looked at them. Their demands were off the charts. They said, "When you ser- deliver your product," it was like a bracelet thing. They said, uh, "It's got to come on a Monday at 10:30 in the morning, and if you are without, uh, if- if you're outside, like, a five-minute window, we're gonna penalize you. If the SKU," you know, that UPS code, "if it's more than a quarter inch below the top of the box, we're gonna penalize you." And, and Walmart does this for, you know, efficiency. That's why they do it. But my client, they were, they saw that as good revenue. It was crushing them with the penalties. Their number two customer was Dollar General. Is, is that around here?

    2. CS

      Yeah.

    3. MM

      Yeah. So Dollar General, Dollar General's like, "Hey, deliver it whenever you can because we're always playing second fiddle to Walmart." So y- y- Codie'll love this. Here's what he did.

  5. 5:13 – 6:56

    Understanding Client Value and Business Strategies

    1. MM

      He put a sign above his desk, and he had, uh, 15 employees. The sign says this: "Our policy is to answer the call on the first ring. If it's the Dollar General, answer the call and start taking their order, and if Walmart calls, let it go to voicemail and then call them back when you're done." The miraculous thing was the next one. It said, "We always answer on the first ring. If the first call is Walmart, start taking their order, but while you're on the phone with Walmart, if Dollar General calls, immediately hang up on Walmart."

    2. CS

      [laughs]

    3. MM

      Like, say, "Sorry, we have an emergency." Disconnect and prioritize. So they're not cutting off customers or revenue, but they're prioritizing the quality revenue. It transformed his business. It was a family business. It was 25 years old. They were struggling to get to 4 million. It went 4, 18, 27, sold it.

    4. CS

      You know what's crazy too? And, and we'll take you guys through this process. So you'll go through a process where you basically analyze your cash flow, and we'll use the 13-week rolling cash flow, which I love, and then we'll also talk to you about your underlying clients, what's your best avatar versus your worst.

    5. MM

      Hm.

    6. CS

      Because I think a lot of times we lump our business all together. We don't know what customers cost us to get, and we certainly don't know what customers cost us to keep. And it's not because we're bad operators. It's 'cause we're busy, and it's sort of hard. And so it takes this pause and analysis. And the truth of it is your team is not gonna do that. That is gonna have to be a you thing at most levels of the business.

    7. MM

      That is brilliant. I'll add to that. There's a real simple strategy that we've deployed, and what you do is you sort your clients out over the last year, the revenue they've generated for you. And the reason is, is people lie to each other constantly 'cause of social grace. Like when you saw me, like, "Hey, Mike. It's so good to see you. I'm a huge fan." Like, are you, Codie?

    8. CS

      [laughs]

    9. MM

      Are you? But-

    10. CS

      I am

    11. MM

      ... I- thank you. But could you ima- could you imagine you come up to me and say, "Oh, your books really

  6. 6:56 – 8:25

    The Importance of Client Avatars and Market Targeting

    1. MM

      suck, Mike"?

    2. CS

      [laughs]

    3. MM

      Like, you can't do that 'cause of social grace and now I'd be like, "Well, that's offensive," and then we get into this disagreement. Or customers will never say to your face, "You know, your business kinda sucks."

    4. CS

      Yeah.

    5. MM

      Uh, Poop 911's here. Oh, it's kind of like more turd 411, you know what I'm saying?

    6. CS

      [laughs]

    7. MM

      Like, like they're never gonna... [laughs] That was good.

    8. CS

      That was a good one. [laughs]

    9. MM

      That was good. That was good. That was ju- [laughs] that was juicy.

    10. CS

      [laughs]

    11. MM

      But they would never, they would never say that to you. What they will do is go online and slam your reputation.

    12. CS

      Mm-hmm.

    13. MM

      So you can't trust their words, but you can trust their wallets. So don't trust words. Trust wallets. If they buy from you repeatedly or they're demonstrating they value you. But there's a second test. It's the intersection of them valuing you, spending money, with your appreciation and enjoyment of them. So when the card ID pops up on your phone, are you like, "Oh my gosh, they're amazing," or are you like, "Oh gosh, I wish they didn't exist"? [laughs] Which one do you pick? Because if you have a customer generates, generates a lot of revenue but you don't like working with them, you automatically, inherently, subconsciously perhaps, deprioritize their service. You don't call them back as quickly.

    14. CS

      No.

    15. MM

      You delay it. You avoid it. So we want the intersection of best customers that you love working with, circle those customers, and start to clone them.

    16. CS

      Mm-hmm.

    17. MM

      And what I mean by cloning them, I find out where they congregate, uh, where's their associations or communities, where's the people like them hanging out, and I'm gonna insert myself there.

    18. CS

      That's so good. Yeah.

    19. MM

      Mm-hmm.

    20. CS

      We, we obsess on client avatars, and I feel like the number one thing that most people do wrong in business is they,

  7. 8:25 – 8:48

    The Real Essence of Business Success

    1. CS

      they sell demographically as opposed to really nailing their avatar. Like I've never met a 45 to 65-year-old male 40% of the time and 60% of the time a woman. I mean, these days, who knows? [laughs] But historically, no. And so, you know, I really like this idea of what are the characteristics of this type of avatar and then how do we go after them?

    2. MM

      Yeah. And look for the congregation points. So

  8. 8:48 – 13:50

    Personal Stories of Financial Ups and Downs

    1. MM

      when I'm targeting a market, I'll say, "Is there an association for this?" Um, you know, this is when I'm selling B2B. Is there an association? Is there some kind of meetups or something like that? Uh, for example, maybe I'm serving, uh, pilots, retired pilots. Well, I'd say is there a retired pilot association, which actually-

    2. CS

      Mm

    3. MM

      ... I know there is. So that's an opportunity. They're already congregating. But if I look for single moms who hate their mom, [laughs] that, that demographic exists, perhaps even in this room. But they don't... Do they have a meetup club? Maybe not. If, if they don't have a congregation point, you have to assemble it yourself. It is the most exhausting, time-consuming effort. It rarely fails. So when someone says, "I have a niche," it's, you know, "I sitting, serve single moms who don't like their moms," I'm like, "That's not a niche," because you have to now assemble them together. But if you're serving the airline retired pilots association, I know where they're going. They may have a dedicated podcast. And you insert yourself there, and they see you ubiquitously. They see you everywhere.

    4. CS

      So good. Let's zoom out for a second. What does everyone get wrong about making money in business?

    5. MM

      Okay, so this is very opinionated. Uh, it ain't about the money.

    6. CS

      Okay.

    7. MM

      And listen, you probably heard that before, and when you don't have the money, it's very easy to say. [laughs] I mean, it's very easy to focus on the money, and when you do have the money it's very easy to say it ain't about the money. Um, my perspective is both. So I became a, a, a multimillionaire when I was in my early 30s. I had an exit to Fortune 500 Robert Half International. Uh, you, you sold Quicken.

    8. CS

      I do. I do remember that.

    9. MM

      You remember them? They had account temps, office temps.

    10. CS

      Yeah, yeah.

    11. MM

      I was doing a computer crime investigation, and the Enron trial broke. My company, right place, right time, we got the Enron trial. Now to give context, we were not the prosecution. That's the FBI, [laughs] the CIA, you know. We were the defense. So if you remember names like Kenneth Lay, Andrew Fastow, they were our clients. They were guilty, by the way.

    12. CS

      [laughs]

    13. MM

      They were... [laughs] That was our defense. That was our defense. They were guilty. Um, and we got put on the map very quickly. What I assumed was when I sold that business, and it was, it was a lot of money, I was like, "I've arrived." But I really, I really didn't. I- what I did, and I'm embarrassed to admit this, but it's important to admit it, is I thought I had to show the effect. So I bought all the, the stable of cars. I got the pl- I got a private place out on Lanai, which is a island owned by Larry Ellison now.

    14. CS

      Mm.

    15. MM

      Um, I, w- for sabbatical, we got a place in a, a very affluent town in New Jersey where I live. And, um, I'm like, "Look how important I am, people."

    16. CS

      [laughs]

    17. MM

      And like no one gives two craps. Then, total idiot, I, I blew all my money 'cause I thought I knew everything. I knew very little. And with the collapse, um, no one really cared either. No one really cares. I found the essence of a good business is that it's an expression of our purpose.

    18. CS

      Mm.

    19. MM

      Like I know from the interviews I've listened that you do, from the alerts you put out, that you're such an authentic, real human, that this platform is an expression of who you are. Listen, your mom is here.

    20. CS

      [laughs]

    21. MM

      You know, the last time my mom came, my mom came, I was doing like a puppet show in third grade.

    22. CS

      [laughs]

    23. MM

      Like this is, that's a dream to have your mom here.

    24. CS

      [laughs]

    25. MM

      Which also indicates the authenticity in this.

    26. CS

      Mm.

    27. MM

      I, I think too many entrepreneurs go for the money only to find out that was a mistake.

    28. CS

      True.

    29. MM

      We gotta go for it because it's an expression of our heart. That's my opinion.

    30. CS

      Ah, it's so, it's so true. And you know what else is crazy that I love that you talk about often? That statement, "It's never about the money," is so, was so triggering to me when I didn't have any money.

  9. 13:50 – 21:20

    Lessons from Financial Failures

    1. CS

      Never.

    2. MM

      Bullshit.

    3. CS

      I know. Isn't that crazy?

    4. MM

      But also true.

    5. CS

      Yeah.

    6. MM

      And me neither.

    7. CS

      Well, even like Mom, we were having this walk this morning. Remember what you asked me? Uh, she was like, "Aren't you proud, like, the headquarters, and look how everything's grown," and, 'cause most of my businesses have been remote. For many, many years I ran businesses where we had people all over the world. She's like, "You have a ... Look, I can touch it, you know? Or do you take a second?" And I literally was like, "Uh," it feels like, what did I say? It, we haven't scratched the surface yet. [laughs] So I totally think about it zero, um, at any level because I, but it's also because I love the game.

    8. MM

      Okay.

    9. CS

      Not necessarily like I want the bank account to be bigger. I still have, don't get me wrong. I mean, what, what, what do you ask me every, every time she sees me [laughs] she asks me, she asks me, "But who takes care of the money at your company?" Every time, don't you? She's always like, "But who's the CFO? Who's in charge of making sure you don't run out of money?" Because if you didn't grow up with any money, that's, like, deep inside all of us.

    10. MM

      Yeah.

    11. CS

      We're just like, "Ah, but who's in charge and are they stealing from us?"

    12. MM

      Yeah.

    13. CS

      And the answer is like, yeah, people are gonna steal from you at some point. That's, that is true. And, and, uh, it'll also be fine and you'll, you'll keep going. But yeah, I agree. I don't think there's ever enough, but if you can flip it to stop talking about the dollar amount-

    14. MM

      Yeah

    15. CS

      ... and start talking about, like, it's never enough because I just wanna see what am I capable of. Like, I wanna die having squeezed every last drop out of me. That's when I think it starts to get fun.

    16. MM

      Hundred-

    17. CS

      You've seen the rarest of things

    18. MM

      ... percent

    19. CS

      ... which is you lost it all.

    20. MM

      Yeah.

    21. CS

      And I think that is oft- how many people here are almost more scared of people knowing that you lost it all and, like, seeing the flame out than actually not having the cash? Who else ... I see a lot of h-

    22. MM

      Yeah

    23. CS

      ... I see a lot of nodding.

    24. MM

      Yeah.

    25. CS

      Like, I think that is what scares us, but you're a perfect example of, like, I was there. Nobody fucking cared and I'm fine.

    26. MM

      No one cares.

    27. CS

      That's wild.

    28. MM

      Like, no one cares. And it is true, that saying that the people who do care don't matter, and the people that matter, you know, do care. Um, the-

    29. CS

      Wait, can I ask you a question? Did you have a very dark moment then when you were like, "I lost everything. This is how I defined myself. Who am I?"

    30. MM

      Yeah. I, do you wanna go there?

  10. 21:20 – 26:44

    Pumpkin Plan: Growing a Successful Business

    1. CS

      of saying instead of staying here worrying about it, which is why I'm always saying to you guys, money really likes speed. He basically was like, "Why would you worry about this one more second? You're not gonna sleep anyway tonight. Stay up. Stay up. Let's look at the books. Let's fix this." And what I've found in investing in hundreds of businesses now, it's almost always fixable, to your point.

    2. MM

      Hm.

    3. CS

      Almost always, but the reason it won't be is 'cause you don't move fast enough, you don't have people who have been there before around you, and you don't focus on profit. You focus on what is gonna look good, what is gonna be okay.

    4. MM

      Yeah.

    5. CS

      Like, sometimes you gotta do the really awful thing, which is rip off the Band-Aid. But I'm so glad you talked about that, because one of our missions here is, you know, we, we've looked a lot at the data surrounding small business, and most small businesses fail. That is true.

    6. MM

      Yeah.

    7. CS

      Most of them do. Nobody talks about it. Most of them do, and a lot of the reason why, I think, is due to not having systems of control-

    8. MM

      Mm-hmm

    9. CS

      ... for situations in which emotion gets high. You have a ton of systems and stories and, um, ways that you kind of are honest about yourself. You keep yourself in your, I'll call it your bumper lanes, because you know that you have self-awareness to be like, "I'm not the best with money."

    10. MM

      Right.

    11. CS

      The people that get in trouble are the ones that think they're the best with it.

    12. MM

      Yeah. Yeah, yeah, yeah.

    13. CS

      Right? And so I wanna talk about, I wanna talk about a couple of things. You can kinda pick which one. Uh, I wanna talk about either The Pumpkin Plan-

    14. MM

      Okay

    15. CS

      ... or I wanna talk about Clockwork, or I wanna talk about Beacon. Do any of those speak to you in this?

    16. MM

      Yeah, they do. So, but I'd say Pumpkin Plan to start. Um, w- what I did, just to give context, that's one of the books I wrote. Uh, and it's the runner-up to Profit First in popularity. What I did was I, I hired a, a business coach before business coaches really existed. This is back in the '90s, and, uh, he came into my business and said, "Day one, we're gonna go to a pumpkin field." I'm like, "What?" He's like, "You gotta understand biology, 'cause there's a thing called biomimicry, and when you study what Mother Nature's figured out, she's pretty freaking smart, and she spent a lot of time figuring things out. You can copy those strategies, and usually they have a more, or better success rate than something that's artificially engineered." So I went to a pumpkin farm and studied colossal pumpkin farming [laughs] , and sure enough, it works for business, too. So that's the context.

    17. CS

      Talk about why and what you got from it.

    18. MM

      Yeah, so there was a, a, a few things. Um, the first one was, it's called seed selection, and basically, to have a successful business, there, there's an intersection. It's like a Venn diagram of three key elements you have to nail, and the likelihood of growing is much greater than otherwise. Most entrepreneurs simply say, "I'm doing this 'cause this is my historical vocation. I have some experience. I'm gonna do it," or, "I heard you can make a lot of money doing it." [coughs] And I don't know if either of those are actually necessarily good. The first thing that we ask- And I ask myself is, do I have something that's truly distinct in the industry? Can you redefine the industry? I'll give you a, a personal example. Um, who's heard of the Savannah Bananas here? Okay. They're exploding, right? So Jesse Cole, uh, is a friend from before, right when the Savannah Bananas were starting, and they used Profit First. I went down and coached the organization. What he did was say, "What is the industry doing currently and sucks about it?" He said, "I don't know if any of you know this, but baseball is boring. It's boring." So he's like, "That sucks." Um, and he went through all these different things. So the first thing he said is, "What are the things that people don't like? I'm gonna un-suck it." That sounded gr- [laughs]

    19. CS

      [laughs]

    20. MM

      That sounded very, sounded very... I don't know why it sounded so gross, but it did. So he, um, he and his wife Emily started to redefine baseball to make it not boring and to make it entertaining. The second thing is they put intentional constraints in place. So they use Profit First, which inherently means there's less money to spend, and one of my favorite things is he said, "We don't have enough money for, like a cheer squad or anything to entertain people." So he's like, "What do you do when you have no money?" He's like, "You ask your fans." So he said, "If you're 80 years or older, uh, and you're a woman, you're, you're in our cheer squad, and teeth are optional." And, [laughs] uh, and it's true for half the squad. I, I met the squad. And they're the Nana Bananas. And people lose their effing minds. Like, we lose our minds watching this. So what makes you truly unique? Better than the competition is not noticeable. You, you answer the phone in two rings, I answer in one. I'm technically better. The customer won't notice. You run a standard baseball game, I have a grandma banana dancing around, I win. You gotta be different. Secondly is you have to have client demand for it. So I- I could do something very different. I could be your first guest that comes dressed like Bozo the Clown. You know, wacka-wacka. I come in in my big floppy shoes. Everyone will notice it's different, but is there demand for a weirdo that does that? Maybe not, and now I've compromised myself. So who's the customer that wants that? And it's not your standard baseball fan. They're not there for the winning game, they're there for the winning experience. So he's redefined the customer. And the last part is, to your earlier point, is systemization. And most people don't understand what systemization is. Systemization is where you can attract prospects, convert them to customers, collect revenue, have them raving about the experience, all while you're sleeping. Without any of your active input, with the entrepreneur not doing any of that, now you have a systemized business. And so what I learned from the Pumpkin Plan is, is that's the seed, and just like growing a colossal pumpkin, you need a seed that matches the environment, the soil content, the climate. You need a seed that matches up with those three elements.

    21. CS

      Some of the greatest

  11. 26:44 – 27:15

    Client Expectations and Rapid Response

    1. CS

      businesses start as nothing more than a notebook full of scribbles. But ideas aren't enough. They need execution. With GoDaddy Airo, execution is fast. A few prompts and you get a website, logo, email, and even social content. Minutes, not months. You go from scribbles on a paper to a polished online business you can actually grow. So stop waiting, stop overthinking. Launch your business today with GoDaddy Airo. Head to godaddy.com/codiesanchez and see what's possible there. By the way, this live episode, if you guys liked it, if you want

  12. 27:15 – 28:35

    Industry Insights and Fixed Billing

    1. CS

      more, well, I have a live event. I only do one a year. It's huge. How big? Really big. In Austin, Texas, just for people who wanna make more money, buy businesses, build businesses. It's called Main Street Over Wall Street. So if you liked this episode, you're probably gonna wanna be there. There's only a couple hundred spots left, so click below. I wanna shake your hand in person in Austin, Texas, or go to msows.com, MSOWS. We'll see you there. So le- let's say that somebody doesn't have their, I believe you call it their prize pumpkin.

    2. MM

      Mm-hmm.

    3. CS

      Let's say that they don't have this differentiator, this, this unique component. What, what do you tell them to do? How, how do people start thinking about that?

    4. MM

      Dude, I got... I don't know why I called you dude. Is that cool? [laughs]

    5. CS

      I love dude.

    6. MM

      All right.

    7. CS

      Yes.

    8. MM

      Dude.

    9. CS

      [laughs]

    10. MM

      I call all my friends dude, so you just qu- I didn't even know-

    11. CS

      That's great. Me too

    12. MM

      ... subconsciously, you just qualified.

    13. CS

      [laughs]

    14. MM

      So dude, this is what you gotta do. I got a magical Jedi mind trick question. I guess I got two that will blow your mind away, and it's not what you think. It's, that's how Jedis roll. First question, ask your best customers, those ones we identified, "What am I doing right?" Now, here's why this is a Jedi mind trick. They will not tell you what you're doing right. So, uh, I used to work with hedge funds. Um, they were, one of my first company, we did technical services for hedge funds. They had Bloombergs and ILX and all these different systems. I went to my best customer, Appaloosa Management. I said, "What am I doing right?"

  13. 28:35 – 29:14

    The Power of Asking the Right Questions

    1. MM

      And they said, "You respond very quickly." Now, this is in the '90s. They said, "The typical computer guy was taking, like, a, a full day to get on site when our system went down. They got backup systems, but you get on site within four hours." Now, here's the Jedi part. When your customer tells you you're doing right, they don't tell you what you're doing right, they tell you how they're judging you, what they're observing. You and I do, you do thousands of things for a customer. Your customer does not see the thousand things. They see one or two things. So when you ask them what I'm doing right, they tell you the thing they see. So when my client said, "You respond quickly," I said, "Holy crap, I'm not responding fast enough," because that's what he's measuring. So I figured out a way, it was real simple, dispatch one of my technicians

  14. 29:14 – 33:18

    Selling Strategies for Entrepreneurs

    1. MM

      or myself to be within a half-hour radius of Appaloosa Management, and any time he had a problem, I would leave my other clients, say, "I have an emergency," with my number one client, dollar general, get there, and I was getting on site within a half hour. Within a month, he's like, "I don't know what you're doing, dude, but it, [laughs] it has blown my mind. Like, y- the service level has skyrocketed." He's like, "We're telling everyone about it."

    2. CS

      Mm.

    3. MM

      So trick one is what I'm doing right is actually what you need to do better. Trick two is what am I doing wrong? But here's a Jedi mind trick. Don't ask what you're doing wrong, because people lie to each other, social consequence. Ask what is wrong with my industry? It's the person outside the room. So like, when I leave here, you can have a candid conversation like, "Oh, Mike was not that good. He spoke a little quickly, and he did a lisp-y thing that didn't work."

    4. CS

      [laughs]

    5. MM

      Like, whatever. You can say what you want, but to my face, you're like, "Oh, you know, you were great. Good tips, Mike." You can't tell me the truth to my face, only when I leave. So have the conversation about the person outside the room.

    6. CS

      Mm.

    7. MM

      The general industry. So I said, "What's wrong with the computer industry?" Th- this is when the... You remember the Pa- You don't remember the PalmPilot. You're way too young. Do you, anyone remember the PalmPilot? Okay, you're over 50. Over 50. No, you're not over 50. The Palm, if you don't know what the PalmPilot was, it was the first smartphone that was neither smart nor a phone.

    8. CS

      [laughs]

    9. MM

      That's basically it, right? It was the weirdest thing. And he said, "M- my computer company, my last guy tried to repair the PalmPilot, and he charged me more than just replacing it. I wish there was fixed billing." We moved to fixed billing in the early 2000s, when MSPs only moved to it in the 2015s or so. So, "What am I doing wrong?" is your opportunity to ... "What's the industry doing wrong?" is your opportunity to differentiate from the industry.

    10. CS

      That's so good.

    11. MM

      I got fired up there.

    12. CS

      I was ... It's good.

    13. MM

      Yeah.

    14. CS

      I mean, it, it is imagi- ... It is amazing how the, the right questions serve you so much better-

    15. MM

      Yeah

    16. CS

      ... than the immediate answers. It's, uh, because you can just rinse and repeat. And one of my pet peeves at our company is, is we send a lot of surveys. I hate surveys. So I'm, I, I, I have like a v- ... Like, how many of you guys get a survey, and you're like, "Thank God that came out. I'm so ... I needed more things to respond to in my email inbox." It's my huge pet peeve. I'm always like, instead, we should actually ... I'm, I'm curious on it. I'm like, we should actually try to sell people more things. And the reason why is because then you actually know what they want. And if you sell something, and nobody wants it, you're like, "Oh, that's, that's the survey."

    17. MM

      That is gold.

    18. CS

      The money's the survey.

    19. MM

      That is gold.

    20. CS

      Right?

    21. MM

      So, I remember-

    22. CS

      Do entrepreneurs, do entrepreneurs sell enough to their customers? Are most entrepreneurs scared of selling?

    23. MM

      They absolutely do not sell enough, and they don't sell the right way.

    24. CS

      Mm.

    25. MM

      I actually believe MVPs are not the right way to sell.

    26. CS

      Mm.

    27. MM

      So, an MVP is a minimum viable product. I think that's too far advanced. We do a technique we call sell to tell. What we do is say ... So we, I, I, uh, was a co-owner in a manufacturing business for a while that we made leather products, uh, sheaths specifically for knives. And, uh, instead of making a, a prototype and seeing what was out there, we simply announced to our audience, "We're thinking about making a sheath, and it's gonna have this feature and that feature. Are you interested in buying it?" But we asked the most important question: "If you are, put down a deposit now." People speak the truth through their wallet. I, I was actually thinking about doing a conference at my old high school, but to pull it off, we needed 250 people there, reached out to our audience. We had 75 people put a deposit down, and we said, "No, this isn't gonna go," and refunded their deposits. Ironically, prior to that, uh, our marketing team said, "Why don't, why don't we just ask?" We had over 1,000 people say, "Oh, I'm in. That's amazing." And if we acted on that, we would have blown money and embarrassed myself at my old high school.

    28. CS

      [laughs] I'm always scared people aren't gonna show up for my parties.

    29. MM

      Oh, cool, rock and roll.

    30. CS

      Literally every time. Still, it never, it never stops. Um, okay. So we, you, uh, you sell to tell, which I love.

  15. 33:18 – 37:37

    Understanding Customer Quality and Pricing

    1. CS

      and actual conversion?

    2. MM

      Yeah. I think the, the two indicators is if you have customers come back to you and say, "Please stop that," that's a [laughs] that's a good indicator. And listen up, particularly your quality clients. Often, we listen to the one naysayer who doesn't matter, like, "You sell so much. You totally suck." And they've never bought from you, and you're like, "Oh, I'm so sorry. I'll never sell again." So, listen to your best customers. Uh, secondly is if you see every time you sell, a decline in purchasing, and I've seen that before-

    3. CS

      Mm

    4. MM

      ... that someone sells so much, people are like, "You know what? I'm just turned off to you. All you do is sell." I think we have to care for our customers at an amplitude of a 5:1, maybe a 10:1, just acts of service, caring for them, educating them, entertaining them, because that builds reciprocity, and then the sell becomes obvious. But I think m- particularly small businesses serve at, like, 100 to zero. Like, they're, all they're doing is like, "I s- I love my community. I'll do anything for them," and they don't monetize it. I would say, Codie, your customers, people in this room, my customers, not in this room-

    5. CS

      [laughs]

    6. MM

      ... maybe, want us to be profitable, and your clients want you to be profitable. In fact, it's the number-one customer, the one, number-one person in your life that wants you to be profitable is not you. It's actually your customer, and we don't believe that. Could you imagine, you go to see your doctor. You have a, like a heart situation. You rush in. Doctor one comes out, and she says, "Oh, um, here's the situation. I'm not profitable. I'm actually [laughs] nearly broke. I'm really panicked for money. I'm, I'm just selling anything to anyone, and I've decided to generalize. I'm gonna do neurosurgery, pediatrics, geriatrics. Anything with an -atics, I'm in." You know, doctor two comes out, and she says, "I am wickedly profitable. I make a boatload of money because I am wildly successful at what I do. In fact, all I do is serve this one situation." Which doctor are you gonna pick? Doctor two. You want your doctor to be profitable. And you're ... Listen, maybe you're not providing life-saving services. You're providing life-altering services. Your customers want to know that you're profitable, 'cause then you treat them as the number-one customer. They won't say, you know, "Hey, can you charge me more? Can you rip me off a little?" But they will say, "I want your undivided attention. I want the best of you," and all those things are indicators of I want you to be profitable. I see you. I see you.

    7. CS

      [laughs] Well, it's such a good point. I mean, I don't know if anybody else feels like Mark Zuckerberg knows, uh, their purchasing pattern better than their husband does, but, like, Mark's got me on Instagram. Those ads come up, I wanna buy. But if I go to double-click on a shirt or an outfit, and the cost of that shirt or outfit is, like, $7.99, I don't buy. Why? Because I think the quality's gonna be bad.

    8. MM

      Mm-hmm.

    9. CS

      Because I think it's not actually gonna be a good service. So not only do I think we don't sell enough, I think we price ourselves out of deals all the time because we're the cheapest, you know? Because we're like, "Oh, no, no, no, I wanna over-serve the customer." No, you lost my business because I don't trust that it could be quality at that price. And so I wanna talk a little bit. You have multiple-

    10. MM

      Can I add to that real quick?

    11. CS

      Yeah.

    12. MM

      Do you want ... All right.

    13. CS

      That's what I-

    14. MM

      Okay

    15. CS

      ... I want you to do.

    16. MM

      So I would buy a $7 shirt, and I think what's important about that is you have to bifurcate your customers. The, a large majority of customers are the cheapo customers, and that's me in that situation. But you care about the quality of your, your clothing, and therefore you're gonna pay a premium. Now, I play guitar. I bet you if I saw a $1,000 guitar, I might buy it. I don't know if you play guitar. Do you? Okay. So you buy ... You'll buy the $7 guitar, I suspect. And what price dictates is the quality of customer. You will find customers at the lower price point. And for anyone here that sells at a low price point, if you ever found that your customers are really bitchy and moany, and they really suck, it's because you're attracting the shit customer, the one who says, "I don't really care about this. I just need a shirt, so I'll pay the seven bucks." And that's why I think we need to have a higher price. We get a higher value customer that's more vested in the outcome, and they're actually a higher quality customer.

    17. CS

      What do you think about ... Yeah, I tend to think that, um, if, when you solve rich people's problems, they pay more, and they appreciate it more-

    18. MM

      Sure

    19. CS

      ... by and large. And when you're a junior entrepreneur, or not even junior, when, when you're not the best entrepreneur in the world, I almost like solving more luxury problems because there's more margin in them typically-

    20. MM

      Yeah

    21. CS

      ... and you don't have to get as many, so it doesn't have to be such a volume game until you're good. Do you think that's true, or do you think, uh, when you go and serve luxury customers, you better be luxury, you better be top tier, you better be great?

    22. MM

      S- great,

  16. 37:37 – 44:22

    Focusing on Business Efficiency

    1. MM

      that's such a good question. I, I think the quantity game is really difficult to compete in, because you only become profitable when you can handle that volume, which means exacting systems. That's why Walmart's so good, but they have to demand from their providers that it has to arrive at 10:30, and there has to be a SKU at a certain point. Small businesses, we don't have the resources typically to pull that off, so that's very difficult. When it comes to quality, quality, I think, is misunderstood. Quality, I think we hear that and, and we say, "Well, it, it's a special fabric," or it's, it's something that's really of long-lasting value, but quality simply means distinct. I'll give you an example. Uh, my youngest son, this is like a bad father moment. When he was six years old, I wanted to show him what, uh, devotion and commitment was, and it was the Olympics. It was, like, the Beijing Olympics. Michael Phelps wins, like, gold number one billion, and in this particular race, I don't know if you all remember, uh, he was actually in third place, and he's swimming, like, super hard, and, and there's, like, three meters to go. He's in second place. There's a meter to go, and the, the person in the lead, I think from the, the Ukraine, is reaching out to touch the wall, and Phelps jumps out of the water like a shark and slaps the wall. And there's, like, this long pause, and it pops up, and Michael Phelps won by .001 seconds. And I jump up. I'm watching my son. I'm like, "Jake, that's the world's best. That's how you do it. Total commitment, total devotion. That's the highest level performer." And he looks at me. He goes, "But Daddy, Michael Phelps isn't the world's best. Jimmy Mickledorf is." Now, here's the bad dad moment. I said, "Who the fuck's Jimmy Mickledorf?" [laughs] I never heard of him. He's like, "Daddy, he's in kinder-" Never say that to your kids, by the way. He goes, "Daddy, Jimmy's in my kindergarten class. He can swim across Mountain Lake." It's a lake near us. And he's like, "He's the only kid in the world that can do it." I was like, "Oh, my gosh." So the context of the best in quality is the context of the consumer's world. For me, it's the Olympic stage. For him, it's his kindergarten class. And Susie can make the biggest cannonball. She's, she's a rock star for him. I was like, "Oh, my gosh. I'm such an idiot." So when it comes to quality, I just ask, we have to know who our customer is and what can we do that's unique and distinct to them they never experienced before, and now you've introduced quality.

    2. CS

      That's so good. Um, let, let's talk about, um, distraction a little bit. You have a lot in multiple of your books. I think I'm referencing The Pumpkin Plan more here. But how do you personally decide when to double down on an idea versus when to call it a distraction and cut it?

    3. MM

      Yeah. So, um, I, I ... We generally look at a revenue threshold, because that's just a g- a, a shocking metric to many small businesses. We generally say if you're not generating $10 million doing your one thing, you haven't arrived yet. You're not good enough yet. For most is, businesses, that's about .001% of the market cap. So it, it's nothing, yet most businesses said, "Oh, we're doing 300,000 in revenue. I should diversify and do more things," and it starts diluting you. It's all about the efficiency game. That's where we focus. The second thing is we just do diagnostics. With AI, it's so easy now. Just look at the customer base, what they're consuming, what's the profitability per product, uh, a- and we just focus in on those few things. I, I think businesses pursue diversification too quickly, 'cause we hear if you're diversified, you're safe, you're protected, but it also stalls growth.

    4. CS

      Do you think entrepreneurs should ever have multiple businesses before they do $10 in revenue?

    5. MM

      Uh, I, if I say no, I'm a hypocrite. Um, so I've, I have many businesses that aren't doing $10 million, but I don't run them. So I think people un- misunderstand what a business owner is.

    6. CS

      Mm-hmm.

    7. MM

      In fact, when, when people ask me, "What do you do?" uh, in addition to author, I don't say I'm an entrepreneur, even though that's my favorite word, because entrepreneurs become so bastardized. There's pundits that say, "Oh, entrepreneurship's hustle and grind. It's, you know, work your ass off." That is not what entrepreneurship is. Y- you were sharing something that I hope people took notes down. 6%, you said, of the world population runs a business. The back... I'll give you the dat- data behind this, 'cause I'm really into the numbers. 17% of the population ever attempts to start a business. So if you think about kindergarten and the, you know, 20 kids in your class, 17, so 3 kids, maybe 4 kids ever attempt to start a business. 20% ever start a business, and after five years are doing it on a profitable, sustainable basis. That's 3%. So the 6% who are running a business, three half of them are actually pulling it off after five years, and that's how the math works, which means if you ever thought about who's the weirdo in your kindergarten class, it was you.

    8. CS

      [laughs]

    9. MM

      You're a weirdo. For some, some messed-up part of your mind's like, "Oh, I can start a business and make money." The number one job of an entrepreneur is not to do the job. The number one job of an entrepreneur is to create jobs for the other kids in your class. 19 kids in your kindergarten class want good jobs with good companies to live a good life with just good experiences. If you are doing the work in your business, you're failing the responsibility of an entrepreneur. Your job, my job, our jobs is to create jobs for the other 97% of the global population, yet most entrepreneurs are doing the work. So [sighs] let me get off my soapbox for a second.

    10. CS

      [laughs]

    11. MM

      I don't call myself an entrepreneur anymore, because unfortunately, we're told that means to work in our business. I call myself a shareholder, because I also own public stock, and I'm a shareholder in my business. And when someone says, "What are you?" I say, "I'm a shareholder of small business." They're like, "What does that mean?" I'm like, "Oh, I own the stock, I sh- I share in the profit, and I give strategic direction, I vote. I don't do any of the work in the business." So for every one of the companies, we have a president, we have, we have a C-suite, if you will, and these are some are small businesses. C-suite could be, like, six people in the entire company, but I am not in the business doing the work.

    12. CS

      So cool. Let's talk about beacons. So you referenced a study, um, about football fields and blindfolds.

    13. MM

      Oh, yeah. [laughs]

    14. CS

      Um, but how do you stay in... How do you stay on course in a business and not get distracted?

    15. MM

      So the, the study, th- this is in my book, actually, called Fix This Next. What I found is most entrepreneurs are reactionary, and I, I... There was a, a study of a woman named Amanda Eller from the state of Hawaii back maybe 10 years ago, uh, and it's a common story. She was this, uh, unique global phenomena. She went for a hike on a path she always does. Halfway through her hike, it was like a five-mile hike, she sees a fallen tree, and she decides to sit down and meditate. She comes out of her meditation, she picks a path, the key variable being a path, starts walking. She's like, "Oh, God, I'm disoriented. I'm not in the right spot." 17 days later, she's found clinging to life by a rescue crew. What's interesting about the story is she was a half-mile from her car. She started walking in circles. Without a beacon, this happens over and over, people get lost. In this German study, they took people on a football field, and they put, um, like, a sleep mask on them and said, "Find your way across." No one could do it, and it wasn't the long way. It was the distance, like, halfway across the field, which is only 50 yards, and they couldn't do it. Most entrepreneurs

  17. 44:22 – 48:40

    The Profit First Framework

    1. MM

      operate their business this way. It's very reactionary. It's like, "Oh, my instinct says go here. My instinct says go there," and we're totally blinded. So we have to pick a beacon of what the business needs. The typical beacon is this. Um, the most common missed part in businesses is, are you profitable on a daily basis? At the end of today, Saturday, are you gonna walk out of here and your business made more money than it spent? And tomorrow, does it make more money than it spent? Most entrepreneurs don't focus on that at all. They simply say, "I need to sell more," and they actually dig a hole further. So the number one beacon is sustainable daily profitability. The second beacon after that, once you nail your profitability, you can use Profit First to do that.

    2. CS

      [laughs]

    3. MM

      Uh, number two is efficiency, and I'll give you the hack to efficiency that most people don't do. Most people say, "Oh, I gotta just learn how to delegate." Question, who here has a personal assistant? Raise your hand. Live audience. Okay, hands down, hands down. Who does not have a personal assistant? Okay, keep your hands up. You are the personal assistant [laughs] if your hand is up right now. It is the biggest flaw in small business. Everyone that just raised your hand, hire a personal assistant, stat, and they don't have to be full-time. They can work one hour a month, and it's not to have someone doing work for you. It's so you can learn how to delegate to other people. It is the biggest weakness most entrepreneurs have, is the ability to delegate. Second tip, most people delegate the wrong thing. "What don't I like to do? I don't like doing this. I'm gonna delegate it." Wrong. What do you love to do so much you'll never give it up? Delegate that, because when you can delegate your passion, you'll learn to delegate the entirety of your business.

    4. CS

      Love that. Yeah, I mean, Zach, you know what one of the first things we do in the boardroom is, which is yell at you guys to get VAs, right? [laughs] He's nodding his head yes. Um, and that is because you're right. Otherwise, that means you do not value your time more than-

    5. MM

      That's right

    6. CS

      ... minimum wage offshore labor. And, like, you gotta look at yourself in the face and think about that for a second. You are saying your time is not worth more than a couple of dollars per hour, and if that is true, then are you really a business owner? And I think the answer to that is, is no, you're an employee. You're still an employee status. And one of the first things we do in, in our groups is say, "Let's offload some of these. Let's kill the zombies, let's cut the weight, and let's offload the things that you should never be doing in the first place." And now there are incredible systems to do that, um, and, and we'll talk about that later today as well, as Zach knows. Okay, I wanna talk about, um... Let's talk about Profit First. Many people think revenue minus expenses equal profit, and profit is the last part of the equation in business. You famously argue the opposite.

    7. MM

      Yeah.

    8. CS

      Let's talk about what the Profit First framework is.

    9. MM

      So after struggling with my own finances, I looked at my businesses historically, and while they grew, and I did sell two businesses, they were never profitable. And so they were strategic acquisitions. I was lucky to get out. Most people will never sell their business. So I ran the data. There was a study from the SBA in conjunction with a major bank. They identified 83% of small businesses in the US, there's 36 million of us now, under 25 million in revenue are considered a small business, so that's probably the majority of this room, 83% of us are surviving check by check. Uh, and, and, and probably everyone in this room, in part, started your business for financial freedom. So I'm like, "Oh, we start a business for financial freedom, but no one pulls it off. What's wrong with us?" And then I was looking at the formula one day. I said, "Holy crap, that formula is wrong." It makes logical sense. Sales or revenues, you subtract expenses. What's left over is profit. Totally makes sense. It does not make behavioral sense. It is human nature, what comes first gets done. What comes last gets ignored, the mañana syndrome. We are told profit comes last. It's the bottom line, last. It's the year-end, last. It's, it's all last. And so most business owners, and how I ran my business, I'd wait till the end of the year. I'm like, "Ah, shucks, there..." I wouldn't use the word shucks, but your mom's here. I'm like, "Ah, shucks." [laughs] I could never swear in front of my own mom, but I'm F-bombing here. I would go, "Shucks, I, I don't have any profitability. Maybe next year." And that was the fundamental flaw. Once I took my profit first, I started becoming profitable every day. It's the pay yourself first principle applied to business. And, and this goes back to B- biblical times. It's, like, nothing new. In the Bible, they talk about tithing and the nece- necessity of putting money aside. Uh, it's been modernized in tons of personal finances. We're told to have a 401 [k] , pay yourself first, and yet in a business, we don't do it. So it's literally that simple.

  18. 48:40 – 51:26

    Investing in Yourself as an Entrepreneur

    1. MM

      And it ain't a shell game. It leverages, um, into behavioral principles, a thing called Parkinson's Law. Parkinson states that, um, our demand for a resource expands as the resource expands. The more time you have to do something, the longer it'll take. The more cookies that are served, uh, as a dessert, the more you're gonna eat. Guilty. And the more money you make in your business, the more you will spend. As your revenue goes like this over time, I bet you your expenses increase at the uncanny same rate. It's because of how we're behaviorally wired. So what we're gonna do is, starting today, every time sales comes in, like today, take a percentage. You wanna have 10% bottom line? Take 10%. 20? Great, take 20%. Take that profit, hide it from your business, and now your business tells you what's available to run your business. What I say is Profit First doesn't fix your business, it tells you what needs to be fixed within your business. Because if you want that profit number, it'll tell you you don't have enough, your prices are wrong, you gotta fix your margins, inefficient, overcosts, all that stuff.

    2. CS

      I love that. We'll do an activity, I think, later today that talks about, like, we like to have people actually think about where in your business can you cut costs immediately.

    3. MM

      Yeah.

    4. CS

      'Cause like one of my... 'Cause it's hard to make new sales, right? You're like, "Yeah, I'd love to go right now, close a bunch of new business, go out there, execute on it." Can be hard.

    5. MM

      Yeah.

    6. CS

      You don't always have control over that immediately, but somewhere in your business is sitting some cash. And so we have a process, Carter's really good at this, where we go through and analyze again and again, where in your business do you have hidden money? And it's not the sexiest of things, 'cause nobody's like, "I saved 1,000 bucks today."

    7. MM

      Yeah.

    8. CS

      You're like, "I closed a bunch of new clients." That's way sexier.

    9. MM

      Yeah.

    10. CS

      Who gets paid the most? Salespeople. Who gets paid the least? Accountants. And yet accountants are more consistent. And so I, I really like this.

    11. MM

      That's brilliant. There's a little hack you can do.

    12. CS

      Let's do it.

    13. MM

      Get a credit card, a new credit card, this sounds crazy, for your business. You can do it in your personal finances too. Move all your subscriptions to that one card and get paper statements. I did it in my personal finances. I'm like, "Oh, I probably spend, you know, hun- couple hundred bucks maybe on subscriptions." Holy crap, I spend 500. I got, like, the hydro system, I got, uh, the Peloton, I've got Netflix, and I was like, "What am I doing? I'm not using half this stuff." You gotta make it visceral, and you gotta make it conscious as opposed to subconscious. In your business, set up a dedicated card just for your subscriptions, and you'll see how much you're spending. It's the first way to get control of that stuff.

    14. CS

      I love that. Yeah, I mean, and I wanna open it up from questions here at the end, so think about it for a second, have your questions kinda ready. Um, the, the other thing I think we don't think about n- enough as business owners is investing in ourselves.

    15. MM

      Yeah.

    16. CS

      And I know it sounds a little cheesy, because it's so much easier to say, "I invested in the business here. I, um, you know, I hired a new person." But I've found that if we don't become better, our business never gets better. And so I'm curious, you've been in the sort of educational business for a long time. Do you still have coaches

  19. 51:26 – 53:09

    Building a Business That Runs Without You

    1. CS

      and mentors?

    2. MM

      Oh, yeah.

    3. CS

      How do you think about investing in yourself as the entrepreneur and getting better? Is that important to you?

    4. MM

      Yeah. So wickedly important. Surprise. Um, w- what I do is identified what is the role that I enjoy the most, meaning gives me the most joy. But first I had to eradicate myself from doing it, so let me explain. I get the most joy from being a spokesperson for my brand, okay? Um, I realize that requires a lot of public speaking, and I realize if I'm the only person doing it, I become the linchpin for my business. So first I educated about 50 people on t- speaking on Profit First, and in fact, there's like three Profit First keynotes going on today, and I'm not doing any of them. So that's the first thing, so I'm not necessary. Then I said, "Okay, well, I own the business, and I wanna do what gives me joy. I'm not gonna sit on the beach and stuff, so I'm gonna reinsert myself, and I wanna be the best spokesperson I can." So, uh, I go to improv classes. Uh, I study comedy. Um, I, I, I look at what do, what do my contemporaries do? And most people sit behind a dais and like, they s- brr, brr, brr, brr. I'm like, that's the one thing I can't do. I have to be different. So, um, I study theatrics, performance, all those things constantly. I have a, a speaking coach who comes to my events and critiques me, sometimes live. Like, he'll be doing signals. He'll sit in the front row, and he's like, doing...

    5. CS

      [laughs]

    6. MM

      Like, we have these hand signals. Like, oh, gosh.

    7. CS

      [laughs]

    8. MM

      Hands out of your pocket. Um, named John Bates. Um, yeah, so I, I'm, I very much invest in that. I, I think for any of us, it, it's just human nature. We can be super elite at very few things, but pick that thing and then you become the Michael Phelps or the Jimmy Mickleburgh of your category.

    9. CS

      Yeah. Well, it's, it's-

    10. MM

      And now you all know Jimmy Mickleburgh.

    11. CS

      [laughs] No, poor Jimmy.

    12. MM

      Good poor Jimmy.

    13. CS

      I wonder where he is today.

    14. MM

      I know.

    15. CS

      You know?

    16. MM

      He's like 20 years old now.

    17. CS

      [laughs]

    18. MM

      He's never had a girlfriend as a result-

  20. 53:09 – 55:30

    Conclusion

    1. CS

      [laughs]

    2. MM

      ... because of me.

    3. CS

      Um, I love that. Thank you. I think a lot of times we need to give ourselves permission to spend time getting better.

    4. MM

      Yeah.

    5. CS

      Because it feels like there's too many things to do every single day, and it might even feel like a little bit of a luxury, and I'm a big believer that, um, you know, if we don't spend money becoming the best CEO we can be, then how can we hire the best talent, who can then be talking on other stages, who can then be growing the business? Like, you cannot attract what you are not, and so I, I think you have to keep becoming better if you wanna attract better people. Okay.

    6. MM

      Yes.

    7. CS

      I have one last question, then I'm gonna open it up for you guys. Um, you often talk about building a business that runs without you. What's the first system every owner should put in place?

    8. MM

      Oh, we do this with every business we invest in. We immediately schedule a four-week vacation for the business owner within one year of today. I, and I challenge you right now, in your calendar, put a four-week vacation that's one month away from the office. Tell your loved one. You're going on vacation with them, perhaps. Tell your kids. They're the ultimate accountability mechanism. And if the thought of that gives you a heart attack, and with most business owners it does, that's the first indicator we do not have a systemized business. If you can extract yourself from a business for four consecutive weeks, we actually turn off your email, s- full shutdown. Um, it changes the mindset from how am I gonna be the superhero again today to how am I gonna get the business operating without me? And that's what we do. That's the first thing.

    9. CS

      At what level of revenue or existence of a business-

    10. MM

      God

    11. CS

      ... do you put this into place?

    12. MM

      We found like $100,000 business, and it's like, how can you do it that as a one-person business? E- even if you're a one-person business, you have vendors, maybe they're not employees. You have clients. You can make your clients work for you. I, I grew up in the back in the day where you had catalogs, and you're like, you wanna order that nice expensive shirt of yours. You call up, and the operator would be like, "Oh, what's your address?" And you say it's, you know, "12 Main St." And they're like, "What was that? Vain Street?" "No." Now they have customers doing the work. We actually go on the web and we're like, click, click, click, click, 12 Main St [laughs] . Like, we think it's cool entering the data for them. So you can actually train your customers to do the work for you. Your doctor, your GP has you fill out this ridiculously long form for you. You're doing the work, and I'm like, "This is amazing." So even if you're $100,000, you can do it. [graphics whoosh]

Episode duration: 55:30

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