WEBVTT

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It's easier to just over-deliver, like, crazy for a client rather than trying to think

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about, like, how to make this scalable, so you don't need to worry about that yet.

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Like, you need to just start making money.

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Welcome to the game where we talk about how to get more customers, how to make more

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customers, how to keep them longer, and the many failures and lessons we have learned

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along the way.

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I hope you enjoy and subscribe.

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What's going on everyone?

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I've got a fun topic today, how to make a million dollars.

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And so I know this is almost click bitty, but I want to go over it mostly because it's

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like one of the number one questions I get all the time.

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And so we might as well actually break down the math for you.

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And so the number one way that I know that someone has no chance in actually doing this

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is they don't even know the math behind how to accomplish their goals, right?

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And so that's what we're going to break down today.

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All right, so the first thing is you have to know how many units of whatever it is you're

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selling to get to your goal, right?

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And the question is do you want to make a million dollars in revenue or do you want to

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make a million dollars in take on income?

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Mind you, to be in the top one percent in America, it's $400,000 a year, all right?

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And so let's say you have a business that runs 40% net margins, which my view is very

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good.

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If you run 40% net margins, that means if you made a million dollars in revenue, you would

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make $400,000 a year in net profit way.

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You get to take owner pay, right?

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From your business, which is why, by the way, I think that having a job that pays well

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is very underrated.

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I think it's just, from being realistic, if you look at the odds, I think it's far, far,

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far more likely that you can achieve a six figure or multiple six figure income.

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Fast by having a really high paying job because you've acquired a skill, then trying to

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learn basically all the skills and own your own business.

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I'm just being candid.

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And I think that if I knew the amount of risk that I was taking on when I started business,

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I don't know if I would have done it again.

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And I think that I had an atypical entrepreneurial journey because I wasn't really an entrepreneurial

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personality type.

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I just really hated my job enough that I was going to do anything, but that's what started

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it.

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But let's get to that.

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Let's get to the mean the potatoes, all right?

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So a lot of times people haven't even figured out their price points on things yet.

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And so the easiest way to understand this is that if you have a million dollars a year

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which is what you want to make, then you want to break this down, right?

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So a million dollars a year is going to be 83K per month, all right?

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Roughly, right?

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It's 83, 33, 33, whatever.

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You could say 84K, but 83K per month, all right?

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That's what you have to make in revenue, right?

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Now, if you break it down per day, I think it's 333333, I think, per day.

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But if you do it per week, so let's just break this into weekly, it'd be like, let's

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just say 21K, okay?

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So 21K per week, all right?

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And you'll notice I'm going to keep breaking this down because it's really difficult to

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hit fuzzy targets, right?

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I heard this from Jason Flatland, fuzzy targets still get hit, right?

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So we need to make this a very precise, clean, pristine target, all right?

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So we got a million dollars a year, breaks down to 83K per month, 21K per week, excuse

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me, 21K per week.

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And then from there, you know, seven days would be about 3K plus per day, right?

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So that's how we know how we can get to that number.

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Now I like weeks because weeks are like normal cycles.

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Daily can be a little bit too volatile until you get to like 10 million plus per year.

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And so if we're talking, starting out, right, 21K per week, all right?

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So the thing is, is we just have to know what the lifetime value of our customer is.

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And so let's say you're selling a single product that has no upsells, right?

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Which is pretty common.

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A single product that has no upsells, let's say your LTV is $1,000, okay?

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Now I want to be really clear about this.

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You don't have to sell $1,000 widget for this, for the math that I'm about to share with

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you to make sense, all right?

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It just means that your total lifetime value of a customer is $1,000.

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Like Starbucks, I think their LTV is like $8,000 and you're like, holy cow, well think

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about how many times you purchase a Starbucks over the last, you know, 10 years, right?

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It adds up.

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And so for me, I'll give you a couple different examples of what $1,000 LTV might be.

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If I sold a course for $1,000 and I sold nothing else, that would be $1,000 LTV.

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If I sold a $100 a month gym membership and the person on average stays 10 months, that

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would be $1,000 LTV.

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If I sold, let's say, crap.

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If I sold skincare products, right, and the average order value was $250 and the average

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amount of time that someone stayed on, my cream products was $4,000, $1,000 LTV, okay?

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So these are all different ways of achieving $1,000 LTV, which makes this hopefully a little

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bit simpler.

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If I have to get to $1,000,000, then I need to sell 21 units per week, right?

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And so that would be 21 divided by 1,000, which is 21, right?

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Units per week to hit our goal.

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And so if I know that I only really sell five days a week Monday through Friday, right?

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Then it means I got to sell four or maybe five, I'd probably make five my goals, I overshoot

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it a little bit.

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So I got to sell five deals a day, right?

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And if I have five deals a day, and the nice thing is with this process that I'm walking

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through right now, you can add as many zeros as you want, it works the same way, right?

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You can add zeros to your product, zeros to your goal, like everything works the same way.

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So it's five deals a day is what I have to close.

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Now, the thing is, is I may know my math, right?

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And know that five deals a day, we close, let's say, one out of three, one out of three

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phone calls, which means I'm going to do 15 phone calls a day who show up, right?

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Real quick guys, if you can think about how you found this podcast, somebody probably

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tweeted it, told you about it, shared it on Instagram, or something like that.

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The only way this grows is through word of mouth.

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And so I don't run ads, I don't do sponsorships, I don't sell anything.

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My only ask is that you continue to pay it forward, whoever showed you or however you found

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out about this podcast that you do the exact same thing.

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So if it was a review, if it was a post, if you do that, it would mean the world to me and

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you'll throw some good karma out there for another entrepreneur.

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And now if I'm selling products, then it might be based on site conversion.

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So if I have like a 1% conversion on my store, an e-commerce store, for example, then

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I would need 100 times the amount of sales I need, right?

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So if I need five, quote, sales per day with a life and a value of 1,000, and I know

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that it takes 100 clicks to get one purchase, then I need 500 clicks a day, hopefully that

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makes sense here.

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But I'm just walking through a more service-based sale because it was top of mind.

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All right.

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So 15 calls per day.

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And let's say that I know my show up rate on these calls is 66%, so I'd have 22 set

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appointments per day, right?

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And the thing is, is I know that based on my either outreach efforts, it takes, let's

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say, I don't know, 50 outreach efforts to get one appointment, I need 1,000 outreach

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efforts a day, right?

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Now mind you, $1,000 deal would not be worth any kind of effort like that.

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So because this is way too low to have kind of like a hand-to-hand combat sale type

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system.

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This would probably need to be closer to like $10,000.

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And then there you go, you get your $10 million.

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But I'm using this just to illustrate the different ways to get there, right?

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And so a nice thing to think about this is that if you take out, if you take this little

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number here, your deal size, right?

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And you put that as the main variable for this process, right?

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You could either sell nine 10K deals per month and have a million dollar business.

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Wow, right?

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You could sell one 100K deal per month to have a million dollar business.

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That sounds pretty chill.

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You could also sell 100, or roughly, you know, 83, right?

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One K deals per month, that sounds a little harder, right?

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Or if you have $100 widgets, you got to sell, God, $830, right, or 33, whatever it is.

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$100 per month to hit that 83K, right?

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And so you can kind of see how much harder it gets to lower the prices.

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Like it's hard to sell 833 things every month.

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I mean, that's a lot of work, right?

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And honestly, it's hard to sell 83 things a month, selling nine easier, right?

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And so it's been, this is just the conclusion that I've made throughout my life, is that

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especially when you're starting out, I think it's easier to start with premium things as

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it's easier to just over-deliver, like, crazy for a client, rather than trying to think

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about, like, how do I make this scalable?

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So you don't need to worry about that yet.

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You need to just start making money, right?

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And so it's like, how can I just, how can I find a sweet spot in here, right?

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This is like $5,000, $10,000, $15,000 mark.

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Not going to find a sweet spot in here where I can just provide tremendous value to someone

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that they will want to continue to do services with me.

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And I don't have to have a tremendous amount of operational skill.

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Because the reason that this is so hard for people, this $100 month, or even $10 month

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range, is it's the operations behind it.

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You have to be able to support so much volume that you're very good with people.

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And that's a totally different skill than learning how to market and sell into car

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customers.

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And so this is where I think most people kind of run into trouble and why a lot of people

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who end up making more money earlier kind of focus on this, on this upper side of the

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ladder.

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There's a very, very, very few exceptions to people who make a lot of money, like super,

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super rare, make a lot of money below this $1,000 per unit price tag, right?

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Like you have to find a way to get your LTV higher because it's just too hard.

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Like a car customer is just too difficult to not have a high LTV and like I said Starbucks

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right?

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8,000 LTV.

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So it doesn't have to be your ticket price.

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That has to be low.

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It's just like you have to find ways to make customers worth more, right?

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Unique, expensive, sticky year if you remember that from before, habit for me.

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Something that they were going to continue to come back again and again and again.

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So anyhow, how to make a million dollars.

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I think most people do not do this math on this, which is you got to make $21,000 a week

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and then there's a zillion ways to make $21,000 a week, right?

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You can sell $100 units, you can sell $1,000 units, you can sell $10,000 units because

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$100,000 units.

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But at the end of the day, that is how you do it.

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And if you're thinking about this from a sales professional standpoint, so I'll break

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this down for you guys as a bonus because I know a lot of salespeople will follow our

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stuff.

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Make this whatever your product is, your commission, right?

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So if you want to make a million dollars, you know, as a salesperson, right, then you

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can need to sell, like let's say you get a thousand or commission, then you need to sell 83

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units a month of your thing, right?

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And that may sound crazy and that it is because that's why, you know, that's why the top

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one percent is, you know, half of that in terms of income, right?

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And so, but if you can, if you can figure out that $1,000, you know, if you can get your,

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like you should be able to think in your mind, like this is my income goals as a salesperson,

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this is what I would like to make is the amount of calls, you know, or calls taken required

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to hit this goal reasonable, right?

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Because on some level, every, every position has a cap based on time, right?

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How much, how much time you could allocate, right?

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There's only 24 hours in a day.

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And so, any who reverse the math on your own business and your own products that you're

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selling, and a lot of times this will help you get your goals a lot faster.

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So, anyway, keeping awesome, lots of love, and I'll catch you guys soon.

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Bye.