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What's going on, everyone? Happy Tuesday. I hope you're having a phenomenal day.

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Whatever day it is that you're listening to this. I had a lot of requests from

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Instagram and DMs and thank you for those. For the 2020 Lessons and Failures,

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this will be a sequel to my 2019 Lessons and Failures, which if you haven't

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listened to that one, I think my year-long recaps are, I think some of my better

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ones, but it's obviously up to you. So this one will probably a little longer than

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what you're used to, and that's because trying to summarize what I learned in a

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year is hard in one episode. Welcome to the game where we talk about how to get

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more customers, how to make more customers, how to keep them longer, and the

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many failures and lessons we have learned along the way. I hope you enjoy and

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subscribe. For those of you who don't know, I keep an ongoing email thread to

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myself, consistently consolidating 2020 Lessons and Failures. So I have this

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big thread that I just continue to email myself whenever I feel like I learn a

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lesson. And so I will do my very best to tell you each of the lessons that I

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learned and how I learned it. And 2020 was a was a packed year of lessons for me.

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And so where it starts. From the $500 million mastermind I learned a lot. From

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there I really learned about scale and seeing the people that were doing more than

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me, all were going after bigger markets. So there's really two options for me to

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do that within the context of Jim launch. One is go after find alternative and

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additional channels to grow the business because you know it's not like we've

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sold 100% of gyms. And so that means that I have to find new ways to reach

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them. So if my traditional advertising methods obviously you know you can

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exhaust a platform, especially if there's a niche it's usually much bigger than

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you think it is. But you may you may not have reached every single person on that

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platform, but you may have reached every person that you could reach on that

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platform profitably. So that's kind of the differentiation. And so for me seeing

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all these people who are doing more than me and I was you know providing value to

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them in a lot of ways. And it's always like it's been a consistent effort of

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mine to try and understand if there's anyone who makes more money than me what

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it is that they have or what it is that I have that they do not have. Because

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sometimes the question is not this is an interesting one for you that I've learned

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also is it's not always good to say what is this person now that I don't?

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Sometimes it's would be the lack that I have and I think oftentimes it's more

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frequently the case which is why it's always backwards which is why I think the

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learning process is interesting. And so you know champions beat normal people at

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their endeavor not because they have something the other person doesn't but

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because they lack the ability to stop working they lack the off switch. And so I

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think sometimes not only thinking what do they have but what do I have that's

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limiting me rather than what do they have that's giving them an advantage over

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me. So first off just even switching my thought process to thinking that way

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has been a lesson of 2020 for me from an entrepreneurial perspective. Before I

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go any further I'll just say this so that you know I'm supposed to keep things

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interesting during these podcasts. So we hit our hundred million dollar amount in

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2020 which is kind of weird so just to clarify this for anyone the reasons I

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didn't put it on this award yet is because I'm not very handy with things and

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I'll probably mess it up so I'll have someone else do it. But just for

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transparency that means I've done a hundred million dollars in total sales the

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last three and a half years. And so we did we did 30 we did 28 million and we

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did seven million and in in 2016 we did 28 million and 27 in 2018 we did

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37 million in 2019 and in 2020 I think we finished at 31 we're still getting

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the final books for this year. But yeah so that was you know that's the that's

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the deal that's how we we hit a hundred million so it's not like I did a hundred

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million in 2020 just for full transparency because I think some people thought

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that's not what it was. But I made a podcast about how I I've been stuck at 30

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ish million for three years and I finally figured out what I need to do to to

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fix it and among those is hiring really good talent that is one another one

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it sounds like so like duh Alex but I feel like it's so many times the

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lessons that I learned or not like nothing's novel like nothing's novel it's

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just at what point does we call them singe moments but at what point does

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something that you've heard your whole life become real for you you know for

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some of us it's like be kind to others it's something you hear your whole life

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but maybe some moment or some event triggers that for you and you're like maybe

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I should be kind to people and then you start changing the way you live and so

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for me you know I've always heard niche down I think it's important to niche

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especially when you're starting but you will eventually be constrained by that

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niche but that being said if you're like I get this one all the time from our

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clients which is like man I got my niche is too small and like homies doing like

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500 grand a year I'm like your niche is a six billion dollar industry and you

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think that you doing half a million dollars a year is somehow tap that niche

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you just have such a poor business model that your lifetime value of a

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customer is so low that you can only profitably reach a half I mean like a

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quarter of a quarter of a quarter of a percent of your market so it's really

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important to delineate between am I capping my niche or are the

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economics behind my business model stifling my ability to to scale and grow

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profitably I think those are two very different things and everyone just

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likes to say likes to point outwardly because it's easier to say oh my niche is

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small rather than saying no my business model sucks and I have no way of

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profitably reaching these people which either means you need to fix your

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business model or you need to find alternative or additional acquisition

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channels and so for us I think we have a we have a I don't know of a lot of

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businesses that have higher LTV from from you know microgemoners than us and

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that's candidly because we provide more value than everyone else does in the

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marketplace that is why you get rewarded and so I mean I always am trying to

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expand LTV provide more value find ways that we can you know solve problems and I

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will always continue to do that but given the numbers that we have the let one

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of the lessons of 2020 is expanding additional acquisition channels and so we

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were able to build an outbound acquisition channel in 2020 so that was really

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cool and the additional part of what made that cool for me was that I actually

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had someone else own the entire process end-in so when I talk about hiring

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high-level talent it's really for me transitioning from the what to the who and

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you've probably heard that before but on some level it became real for me and

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the obsessive nature of the entrepreneur of wanting to learn how to do

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everything is absolutely required in the beginning but as you scale up it is

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more about finding the who but the thing is is that in the beginning you think

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too soon you need to find the who and in reality you still need to learn the

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things that make the business work and so I think that's why context and timing is

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so hard with these things because we have to find like when I'm trying to give

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you know advice it's you know you have to take it within like your current

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paradigm and I understand that that's difficult and that's why sometimes it's

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hard listening to billionaires because it's like their paradigm of of what's

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happening what is what are the successful actions for them right now and

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they're in their current chapter is different than somebody who's at zero or at

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a hundred thousand dollars a year and so I'm gonna try and cater this as

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broadly as I can with as much you know contextual points as possible so

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number one adding additional channels number two focusing on who not what and

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specifically high value who and my picker my ability to judge quality of talent

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has increased I think I've gotten better at it I was not nearly as good at it

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years ago and I don't know how you learned that without experience so that is

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that is something trying to find people with pre-loaded solutions so as a

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caveat to that that's one of my lessons which is like I've now found people who

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come pre-loaded with solutions they come batteries included you know I'm like

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hey here's my problem I can point them at it and they're like oh this is all

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the things we need to do because I've already done this three times like got it

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yes please go do that and you know as a as as a as a as a correlated that my

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role within the company I would say in 2020 transitioned from being a CEO to

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being investor slash owner slash stakeholder shareholder whatever way you

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want to say it but really I would say for the first time in 2020 I really

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transitioned to being above the business not like a weird air going away just

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like not truly being out of it and so I think there's definitely levels to

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being out of it you know first your you own your own job right you're self

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employed and that's just you doing things for other people for money you just

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someone else is paying you and you're doing stuff you know above that you start

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becoming a manager and managing other people right and then above that you

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become a leader and then above that in my opinion you become an executive right

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which is like leading organizational change in and departmental change around

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objectives that are going to protect the business or grow the business right and

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I think the level above that is where I feel like this year I was able to get to

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I could be wrong we'll find out in 2021 lessons and failures but I right now

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I'm not I don't actually do anything in the business besides meet with two

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leaders a week and really advise on the ways that we can strategically improve

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the business and provide more value and so that's really the majority of my

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time is like looking at the overall marketplace and thinking like how can we

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provide more value in a strategic way to everyone right and what are of the

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many ways what is the one thing that we're gonna focus on and so I think 2020

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was also a really humbling year for me because we got to refocus on the few

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things that provide the most value and so for us it's we need to get Jim's

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leads because that's what everyone wants we need to make Jim's more money

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because that's what everyone wants and that's about it you know pretty much any

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other you know endeavors that are not focused on those things are kind of

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a waste as much as you know people may need to have better retention tactics

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better you know better profit margins and we talk a lot about that whenever we

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do talk about that we lose people lose interest because entrepreneurs most

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entrepreneurs that I serve only think about revenue right the only thing about

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growth rather than what am I taking home you know how much risk am I exposed to

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that kind of stuff and I think that just comes with time but I will practice what I

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preach and not sell what I want to sell I will sell what they want to buy and so

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that is how you know we've we've cut a ton of access out in 2020 in the business

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and so really focusing on a handful of key priorities has been really useful

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and interestingly I think the business has actually improved since I've moved

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further away from it because I tend to break things a lot because I want to

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fix it till it's broken if you know what I mean and so giving our leadership

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space to just transact you know run the business has been really valuable and I

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think it's actually been I think it's been better for the business overall so

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those were some of my my initial lesson I've got a whole bunch so I'm just

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going to keep going through this so one of the next ones was I was talking to

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Brooke Castillo she is an amazing business a good friend of mine if you've

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heard of her life coach school podcast check her out she's an amazing pot she's

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huge following and she didn't say this directly but like the the term that

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came in my mind was scale scale zero and simple scales and or zero scales I'll

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have to come up with something catchy for that but basically the reason that

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I had to be get into the you know quote in investor or owner type role I believe

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is because if I am involved in any really day-to-day activity I will become the

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bottleneck right and it's not a bottleneck of communication which is what

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happens when you are the manager as a bottleneck but as as as somebody who

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even provides value in any way if it requires you to be there to provide the

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value then as soon as the team grows outside of you providing that value if it

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cannot grow without you providing whatever that value is then it will stop

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there and so I think that's 2020 was really my transition of moving above

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that and so I think that was kind of the win for the year and so that was kind of

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one of the lessons that I learned is you have to scale zero like I have to get

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myself to doing nothing and still have the company make money and grow and be

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profitable etc in order for us to be able to grow beyond where we're at and I

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think that's much easier said than done especially because a lot of

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companies start because the entrepreneur is skilled in a certain way or has

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a variety of skills which is usually what happens we have a stack of skills which

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is why you know why we start growing and then somehow you have to in the

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beginning extricably you know or intrinsically link yourself to every aspect

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of the business is what makes it grow and then piece by piece peel off each of

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these skills and traits and and things that you don't even know you do in the

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business to keep it moving and that's taken time and it's and it's taken

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trial and error and it's been difficult but ultimately rewarding because now

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right now it's I would say like one day a week is focused on all my leadership

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meetings and that's it and then beyond that it's just strategic insight on

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monthly and quarterly so that's given me a lot more time to really focus on the

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industry and how we can and help overall rather than being kind of like in the

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tactics next one I have this belief and it just continues to be reinforced

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that see if you can just keep growing and not hire people we have had I mean

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all you got to do is look at our our atrocious glass door reviews which

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suck to know that like we have we hire fast we have had a tendency to hire

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fast and fire fast so we have followed that mantra but I and the thing is

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is part of the difficulty of having a business that that grows quickly is or has

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any level of volatility month to month is that you have these waxing and

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waning demands for labor right and so it's like you need five people and then

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the next month you don't need the five people anymore and you know I'm not

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saying we hire five people and then let them go it's more that like that

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consistent variability can be annoying from a from a payroll and labor

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standpoint and what's unfortunately happened many many times is we'll bring

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people on we will solve the problem and then they won't and it really should

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be like you know for defined periods of time you know like project based and

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whatnot the problem will be solved and after we let the people go the business

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grows more and that's kind of weird and backwards for me as an entrepreneur and

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so I'm gonna just try and make sense of it out loud with you but I kind of have

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this belief that only one out of five employees in a company is providing

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value like I I actually like kind of believe that I kind of the 80-20 people

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are fractal I just can't like I just the amount of times that we've literally

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gotten rid of like a department because it's just like we we created a

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department for example to solve a problem let's say it was churn and provide

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value in all these ways to self-churn and then after scaling that after six

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months realizing that churn is completely unaffected and we just took 20 more

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employees on and then having just be like well guys you didn't solve the

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problem and as much as you're doing stuff it doesn't is not doing anything

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right and so then we have to you know let people go because it is a business

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and and then and then just realizing that the business literally doesn't

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change at all like revenue doesn't change churn doesn't change profit doesn't

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change well profit goes up and that's it and it's just like it's mind blowing to

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me it's like there's so many people especially as your organization grows that

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you're like this person was totally unnecessary and that's crazy because from

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the employee perspective it's like how can you do that and I understand that

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perspective but on the flip side is the owner you're like man this this person

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was 90 thousand dollars a year like people are afraid of signing up for a

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mastermind and yet will hire an employee for 50 thousand dollars a year without

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even thinking about it and it's just like which of these things is providing

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more value you know what I mean and so that's that's something that's been like

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mind blowing to me is is seeing a company grow after shrinking it's like it's

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crazy and it's happened so many times and it happened twice in 2020 for us

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where I would get rid of a key team or key you know serious individuals who

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are doing a role that we we were tracking metrics on and we kind of

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implemented it into it to provide a solution and then it and then disappeared

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right and because the solution like it did not solve the problem and

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therefore was not providing the value that it was supposed to and so people

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were essentially cutting grass with scissors which doesn't they're doing

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stuff but it doesn't mean it's for it's being valuable right and so I am now

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really trying to add the constraints to I want to see if we can grow with no

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people like how can we look at Berkshire Hathaway right how can we look at Warren

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Buffett who has 19 employees and runs a gigantor you know company how can we

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find fewer smarter people that are preloaded with solutions like I said

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earlier but it's like I'm just trying to hit it this in multiple ways because

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it's it's really ingrained in me this year how important having an A

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player is compared like one A player literally does more work than five B

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players it's crazy like most people actually do nothing like it's it's it's

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crazy like most people don't do anything and and and that's why they can't

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progress I mean like as a as a tangential site story you know I there's a guy

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that I've seen in a mastermind this is an entrepreneur right and he's uh you

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know he's like hey you know and this is three years ago when I met him he was

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like yeah I'm gonna start on in Facebook at soon I was like awesome fantastic

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like that's a great idea and because his biggest issue was that you couldn't

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get Legion right sorted and I saw him at an event three years later and I was

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like hey man how's it going you know how's the business whatever and he's like

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yeah just you know we're gonna start we're gonna we're definitely gonna start

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Facebook ads soon and I was just like bro it's been three years like what

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are you doing you're like what are you like what are you doing you know what I

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mean like you just it you know I mean there's different for it's different for

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me if someone's like trying to figure out what the obstacle is versus knowing

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what the obstacle is and not doing anything about it that's that's the one that

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kind of drives me nuts and so it's I was like dude if you literally spent one

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day and just googled how to run a Facebook ad you would be able to run a

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Facebook ad by the end of the day like this is not a quarter-long solution like

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do it you know what I mean and so I say that to say a lot of people think they're

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productive when in fact they are busy and actually do nothing and I don't know

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if it's it's their fault or whatever but that is just an observation that I've

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had and seeing the company become more profitable and grow even while we

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contracted resources is sadly reassuring or reaffirming and so it's just like

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you probably know if you're in a in a company of any size that like there's

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like a handful of people that you know that everybody knows because those are

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the people who move right like there are people in our company that I don't

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know who they are and I don't know their names and I'm like who they're like oh

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we let go of Kelsey and I'm like who's Kelsey and then now I've kind of been like

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well if I don't know their name that's why they got let go because if you're

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doing something I will hear about you they're like oh yeah this new girl in

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blah blah blah is killing it right I'll hear about it but if I'd never hear

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your name it's because you're not doing anything so anyway that's that's

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another one of the lessons I told you this was me a longer one and probably more

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encapsulated okay next one oh my god data management is has been the biggest

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mistake or has been the has been the thing that I messed up the most in the

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last three years which is having a really good ERP or CRM that I run everything

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through it is properly set up and I this has plagued my business for three

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and a half years and I think it's actually been one of the things that has

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kept us at 30-ish you know a million a year and we we just got HubSpot it's

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expensive I think we pay 36,000 a year for it but it's worth every penny it's

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just it's just worth every penny it's it's so funny because we were like man

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that's so expensive for CRM I'm like do you think that the entire system and

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all the data of everything that you have is worth more than a front line

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employee just one do you think it could provide value to everyone in the

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company disproportionately to one front line employee well yeah it's like well

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like think you know think in relative terms but now we finally are able to

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track from click to close which has been gosh the hardest thing in the world and

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if I can start all over again so if you are you know listening to this like

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invest early in really good data systems like it will make your life so much

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easier and like I genuinely conservatively can say that we've we've left

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thirty probably thirty million dollars on the table over less three and a

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half years because of such poor data management and because of our IT systems

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have been literally the ban of my existence and so now when I start new

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things or I talk to new companies the first thing I'm looking at is where do

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you interact data what's your CRM you know are you one of a Google sheet you

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know ZAR is that how you're running everything great let's put the whole

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system in place so that's just a huge one that I feel like I now I got the

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I got the success from that and I've learned from three years of failures and

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so that was a really big one for us next one is three businesses you know I

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I shouldn't have three businesses that's a continue to be a lesson of mine

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because we have prestige labs gym launch and Alan it's been very hard for me

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not from a time perspective but from an attention perspective to split my

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attention like that and so I think part of it is this was like a paired lesson

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and failure is that I think the decision was incorrect but I think that the

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lesson that I learned from it was it forced me to get out of CEO and into

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investor owner role and I think that was that was the gift of the curse the

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curse is that like I now know that I shouldn't do that in the future and so

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now I'm trying to figure out really how to run these as portfolio companies if

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that makes sense so that's that's been the hard part and the thing is you can't

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like undo something like that you know what I mean I've got I've got you know

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100 employees like I can't you know what I mean so that's those are those are

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mistakes that are you know Jeff basis says when I'm making a decision there's

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there's reversible decisions and irreversible decisions starting a company is in

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some ways an irreversible decision and so it's not completely reversible but it

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does you know it it's it's long and difficult you know what I mean if you

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want to try and undo that which is either through a sale or you know whatever

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or just winding it down we're trying to like somehow sustain it and

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systemize it so it stays at a certain level and doesn't require attention is

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also hard and so anyways that's kind of actually a lot of what I would say I

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struggled with in 2020 that I've you know actively been putting solutions together

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for 2021 so I'll let you know how that goes this is a big one know what your game

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beyond the game is this is a really big one that I've learned in 2020 which is

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you know we've you know my wife and I've made a lot of money over the last three

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and a half years we took 35 36 million dollars out of the business just in

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direct distributions so that doesn't include like the actual value of the

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companies and you have to know what to do with the money and I actively I'll

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tell you the thought process I had behind this which is my second year so in

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2018 it took home 17 for in profit so it's two years ago and while at that

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point I said well if I were to get 20% return on my money I would make

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$3.4 million on the 17 right so me working on my business makes me 17 so I

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should just keep working my business and ignore the money but at a certain

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point the kind of the the lost compounding becomes big enough that that it

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can surpass your regular income and so you know if you look at what 20% of you

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know if for example I had actively managed it and had 30 million dollars and

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done 20% growth it'd be 30 goes to 36 36 goes to 42 and at that point you're

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making eight million dollars a year and that's two years three years later

336
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right and so at some point you have to the opportunity cost of not managing the

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money becomes bigger and so and it actually starts to take attention like a lot

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of my attention is getting drained on the fact that just this gigantic big

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stack of money that I was like what am I gonna do with this thing right I don't

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want to learn the real estate game I don't want to learn the the you know hard

341
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money lending game I don't like there's so many different games for money I don't

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want to learn the private equity game so I spent probably 30% of my year this

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year on figuring out how to allocate money and I try to allocate them within our

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companies because those are things I have direct control over and I'll get

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disproportionate returns on which is you know candidly why I started prestige

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labs is because I had all this money from Gemini once and I was like well what's

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an ancillary business to what I currently have that can provide value to my

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customers that I can use the same you know distribution base and shared

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services on that I can make you know that I can get a disproportionate return

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and that's what started prestige labs and and now you know two years or two

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and a half years later prestige labs is a good business it's a it's a real it's

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a very good business it provides a lot of value we paid over ten million

353
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dollars in commissions so that's been really good but it I I don't think it was

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the correct decision at the time but now that I have it I am grateful that we

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have it so that's kind of the long and short of that one but knowing your game

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beyond the game because it will it will distract you because what ends up

357
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happening is like once you start getting into that world you get sucked into

358
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it and then your actual business starts losing your attention that's where

359
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your highest return on attention is is inside your business right is your

360
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income and growing it right because both your net worth and the cash flow from

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your business both of it like it's one of the it's one of the cool things about

362
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being entrepreneurs like the net worth that you have in the equity of your

363
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business is usually larger than what you have pulled out of your business

364
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actually most times it's it's large and we pulled out your business and so that's

365
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that's kind of you know interesting and so for me trying to figure out how to

366
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allocate those things has been a priority so before I get the question I'll just

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tell you this is this is what I have invested my money in this year first we

368
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have a whole life insurance policy high catch value upfront you have to be

369
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really careful about the people that you work with this because they can

370
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totally screw you and they are incentivized to screw you and most insurance

371
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agents will not want to hear that but they the the commission structure that

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they have for these policies is insane it destroys the the cash value that you

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earn from these things so if you decide to set up a whole whole whole value

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whole that cash value whatever insurance policy one go with the big four so

375
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that's Guardian New York life Northwestern Mutual and UMass or Mass Mutual

376
00:28:48.480 --> 00:28:52.280
excuse me so there's a big four they've been all around for over a hundred

377
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years you know New York life spent around for 183 years they predate the tax

378
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code the reason I did that is because it it basically creates a bank account

379
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for you that you can use you obviously pay costs in the beginning but you can

380
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basically loan against the the cash value of the insurance and the cash flow

381
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guarantee is you know it's guarantee growth at about 4% a year and so if you

382
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just compare that to a traditional bank account where you're losing money this

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at least covers for inflation right and so that allows you to at least park the

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money in a way that's not devaluing itself and if you do see opportunities you

385
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can loan against it and invest in those things so that's the first thing that we

386
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did if you ever do one of those you should be able to break even by year three

387
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to five at most if it's designed properly they'll tell you that no that's

388
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gonna that's gonna sacrifice the long-term blah blah of the of the thing I think

389
00:29:46.720 --> 00:29:50.080
that's horseshit when you when you compare it to the present day cash like the

390
00:29:50.080 --> 00:29:54.480
value of having your money available to co-invest at the same time is it's not

391
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even an argument in my opinion it's also how corporations and banks and

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Fortune 500 company structure so ask so looking to Coli and bully which is

393
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corporate owned life insurance and bank on life insurance if you want to see

394
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how they structure it because they know what they're doing and so that is how

395
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we structured it so that's number one real quick guys if you can think about

396
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how you found this podcast somebody probably tweeted it told you about it

397
00:30:17.880 --> 00:30:21.920
shared it on Instagram or something like that the only way this grows is through

398
00:30:21.920 --> 00:30:25.440
word of mouth and so I don't run ads I don't do sponsorships I don't sell

399
00:30:25.440 --> 00:30:29.320
anything my only ask is that you continue to pay it for do ever show to you or

400
00:30:29.320 --> 00:30:32.880
however you found out about this podcast that you do the exact same thing so if

401
00:30:32.880 --> 00:30:36.280
it was a review if it was a post if you do that would mean the world to me and

402
00:30:36.280 --> 00:30:39.840
you'll throw some good karma out there for another entrepreneur

403
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number two we are investing in B&C class multi-family apartment units

404
00:30:46.760 --> 00:30:51.360
syndication so that's big apartment buildings the reason for that is because I

405
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think I think single family might get hit hard in the next few years because I'm

406
00:30:56.320 --> 00:31:00.640
looking at like you know seven-year timelines I actually think that I mean who

407
00:31:00.640 --> 00:31:05.040
knows I won't even make my prediction because there's no point but I think

408
00:31:05.040 --> 00:31:09.840
that that asset class has outperformed other asset classes and if people

409
00:31:09.840 --> 00:31:13.600
downgrade their living standards because of some kind of recession because I'm

410
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really much more about downside mitigation than I am about getting the upside

411
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because my upside's in my business so it's really like where can I park money

412
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that I know it's not gonna go anywhere and so I take inferior returns to know

413
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that I have no downside or less downside and so parking money in B&C class real

414
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estate has been one of those those places through syndicated deals the third

415
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place is I have index funds so that's indexes of the entire market because

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again this is one of the things that I don't want to think about and I'm not

417
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trying to stockpick because this is not how I make income like this is not this is

418
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the thing that everyone is like man I could get better yeah sure you could

419
00:31:51.080 --> 00:31:54.360
better turns if you were a daily trader but you also have a business so are

420
00:31:54.360 --> 00:31:57.000
you gonna learn that game and be better than the biggest institutions in the

421
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world that have you know zillions of dollars to literally destroy you maybe

422
00:32:01.120 --> 00:32:05.240
but probably not and so what you can do is be really good at your business and

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provide good service and provide good value and make more money that way and

424
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then be willing to take the non premium return you know of active management and

425
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basically make money on your on yourself twice because you're making money on

426
00:32:17.080 --> 00:32:23.360
income doing your thing and you get passive from your investments I have a

427
00:32:23.360 --> 00:32:30.600
5% hedge in crypto I don't really like speculative things but the only

428
00:32:30.600 --> 00:32:35.680
reason I have that is because if for some reason the dollar gets devalued and

429
00:32:35.680 --> 00:32:41.520
for some reason we lose the world currency that would probably greatly

430
00:32:41.520 --> 00:32:45.800
appreciate and value and would the reason it's a hedge is that I'm not trying to

431
00:32:45.800 --> 00:32:49.680
make money on it I'm only saying that I'm putting 5% there so that if that

432
00:32:49.680 --> 00:32:56.000
happens that will probably 5x if that were to occur which would offset the

433
00:32:56.000 --> 00:33:00.280
losses I would have and basically the majority of my investments and so that

434
00:33:00.280 --> 00:33:05.160
is my that is the conclusion of my investment strategy and what I am focused on

435
00:33:05.160 --> 00:33:08.920
outside of just value creation the business because that's actually the fastest

436
00:33:08.920 --> 00:33:16.440
way for me to increase my net worth okay next one if you are financially done

437
00:33:16.440 --> 00:33:19.000
you must have a bigger purpose so that was one that I learned this year is like

438
00:33:19.000 --> 00:33:27.120
you're like I mean I'm I shared my numbers transparently with everyone I we

439
00:33:27.120 --> 00:33:34.680
need to like it you have to you have to sound stupid you have to really like

440
00:33:34.680 --> 00:33:40.960
what you're doing and have a purpose beyond it otherwise like the money

441
00:33:40.960 --> 00:33:46.280
starts being meaningless and it like it just it doesn't incrementally change

442
00:33:46.280 --> 00:33:51.080
my life in any way you know like think think about it like I know this sounds

443
00:33:51.080 --> 00:33:56.360
crazy but just like imagine if buying a Lamborghini for example was one

444
00:33:56.360 --> 00:33:59.840
week's paycheck well what do you do after you buy Lamborghini the next week

445
00:33:59.840 --> 00:34:03.200
right and let's see buy a crazy house and that's like five weeks of paycheck

446
00:34:03.200 --> 00:34:08.160
well then what do you do with the other 40 you know five weeks of the year's

447
00:34:08.160 --> 00:34:15.040
paycheck right like it you know a stake dinner you know like is not that

448
00:34:15.040 --> 00:34:18.360
expensive in the relative term of things like I had a stake dinner two times a

449
00:34:18.360 --> 00:34:23.720
day or you know what's a capital grill and spent two hundred dollars at three

450
00:34:23.720 --> 00:34:29.560
meals a day even right this 200,000 years and that is crazy for sure but it's

451
00:34:29.560 --> 00:34:34.560
also like within the relative scheme and this is where like this is where the

452
00:34:34.560 --> 00:34:40.480
ultra wealth part starts to get weird is that like if you have ten million

453
00:34:40.480 --> 00:34:45.480
dollars and you grow by fifteen percent that's a million and a half dollars a

454
00:34:45.480 --> 00:34:50.480
year and they get bigger and that's what's like it's you can't eat it you can't

455
00:34:50.480 --> 00:34:53.960
like I still eat chicken and rice like it's not you know like nothing I eat

456
00:34:53.960 --> 00:34:58.440
bagels and I eat the the cheap deli meat from the the supermarket like my life

457
00:34:58.440 --> 00:35:02.340
hasn't really changed you know I have a nicer camera now and there's a thousand

458
00:35:02.340 --> 00:35:08.580
dollar camera you know but you really have to find something that that I'll

459
00:35:08.580 --> 00:35:13.980
put it this way I have found that I must do work that I find meaningful and that

460
00:35:13.980 --> 00:35:19.380
is what gives me purpose in life is that what I do I find the pursuit of that

461
00:35:19.380 --> 00:35:25.140
endeavor meaningful and the actual process itself enjoyable and so that is one

462
00:35:25.140 --> 00:35:28.380
of my my bigger takeaways from 2020 later when I spent more time together this

463
00:35:28.380 --> 00:35:33.980
year than we ever have and man it was the best thing about this year was my

464
00:35:33.980 --> 00:35:37.020
marriage got a lot better not that it was bad but it's just like we're just

465
00:35:37.020 --> 00:35:41.220
really good and the whole year has been great which was definitely offset by

466
00:35:41.220 --> 00:35:44.460
the craziness of the of the world and I think maybe that's maybe that's why we

467
00:35:44.460 --> 00:35:48.820
came even closer together but really focusing on the marriage has just made my

468
00:35:48.820 --> 00:35:52.500
life more enjoyable even though we actually made less profit this year than we

469
00:35:52.500 --> 00:36:00.460
did the last two years and so yeah that's that's that one I did make one good

470
00:36:00.460 --> 00:36:04.860
decision this year we actually developed a whole CRM for gyms for the same reason

471
00:36:04.860 --> 00:36:09.460
bringing up is that you need to have good data management and I spent a million

472
00:36:09.460 --> 00:36:16.020
bucks on this thing and I realized that I couldn't have four businesses and so

473
00:36:16.020 --> 00:36:18.780
I pretty much just killed the project and I just wasted a million dollars so

474
00:36:18.780 --> 00:36:24.300
I make lots of mistakes just so you're aware lots and lots mistakes that was a

475
00:36:24.300 --> 00:36:26.820
good that was a good decision that starting it was not a good decision but not

476
00:36:26.820 --> 00:36:30.060
doing the business after I had made it was a good decision even with the

477
00:36:30.060 --> 00:36:35.180
sun cost which was hard another one is entrepreneurship comes in cycles and

478
00:36:35.180 --> 00:36:38.700
seasons there are seasons of heavy work and there are seasons of there's

479
00:36:38.700 --> 00:36:43.100
seasons of reaping and seasons of sowing and I think recognizing that there

480
00:36:43.100 --> 00:36:46.780
are cycles is really important and there's even seasonal cycles which sounds

481
00:36:46.780 --> 00:36:50.700
crazy but now this is like the fourth year for our fifth year you know that we're

482
00:36:50.700 --> 00:36:55.460
going into for us and every year I'm always like I feel like January through

483
00:36:55.460 --> 00:36:59.220
June I'm like we're on fire you know what I mean and then like by December I'm

484
00:36:59.220 --> 00:37:02.620
like we suck and we shouldn't be in business and we're horrible you know what I

485
00:37:02.620 --> 00:37:05.260
mean and then like January comes again and then it was like everything explodes

486
00:37:05.260 --> 00:37:11.780
and so I you know I've now I come to recognize it and I prepare the team for it

487
00:37:11.780 --> 00:37:16.540
and I think now that this is like my fourth of this cycle through it I'm more

488
00:37:16.540 --> 00:37:20.940
steady and so that's been I think a lesson in seasonality I was talking to

489
00:37:20.940 --> 00:37:26.260
Brandon from weight loss weight loss and he talked about the same thing as

490
00:37:26.260 --> 00:37:29.700
he and I started around the same time and he realized the same thing is like

491
00:37:29.700 --> 00:37:34.380
doesn't matter what we do we are somehow also subject to the cycles of

492
00:37:34.380 --> 00:37:39.620
seasonality and they always have their you know Q1 is always as strong as

493
00:37:39.620 --> 00:37:42.700
quarter why because people are more motivated and weight loss when they're

494
00:37:42.700 --> 00:37:45.180
going into summer going to spring you just started you know just had

495
00:37:45.180 --> 00:37:48.380
Valentine's Day and New Year's Eve so there's like all the reasons are all

496
00:37:48.380 --> 00:37:53.420
right there you know once it's August you know or July it's not usually a

497
00:37:53.420 --> 00:37:57.380
huge you know fitness month and you know a lot of my business is correlated to

498
00:37:57.380 --> 00:38:03.460
fitness and weight loss so that was that one ah three-year life cycle of

499
00:38:03.460 --> 00:38:06.380
products so the average product or service has like a three-year life cycle

500
00:38:06.380 --> 00:38:10.500
and you know Jim launch has had to innovate it's I would say product sweet

501
00:38:10.500 --> 00:38:15.100
twice so we started with kind of like the whole six-week challenge thing and

502
00:38:15.100 --> 00:38:20.460
then we transitioned to kind of higher ticket hybrid bootcamp packages and

503
00:38:20.460 --> 00:38:22.980
right now we actually sell the same packages but the acquisition system is

504
00:38:22.980 --> 00:38:25.860
different it's all out-bound based because that's actually where the biggest

505
00:38:25.860 --> 00:38:30.100
arbitrage is right now meaning we can buy leads and get sales basically our

506
00:38:30.100 --> 00:38:36.100
ROI on time is highest there and so we just continue to see the cycle of you

507
00:38:36.100 --> 00:38:38.420
know and you kind of get into these transition points where like a new

508
00:38:38.420 --> 00:38:40.900
opportunity opens as another one's closing and then you kind of have to like

509
00:38:40.900 --> 00:38:44.460
readjust the product and jump and that's always just focusing on like what's

510
00:38:44.460 --> 00:38:49.780
working best right now another one is having multiple acquisition channels and

511
00:38:49.780 --> 00:38:54.620
streams is really valuable now that we have outbound you know like I teach

512
00:38:54.620 --> 00:38:58.180
the gyms what I'm doing with my own business having outbound has been really

513
00:38:58.180 --> 00:39:03.420
nice it's it's stable it's much more reliable it's slower for sure to grow it's

514
00:39:03.420 --> 00:39:08.180
like 90 days to really get it right for us it definitely doesn't take nearly

515
00:39:08.180 --> 00:39:10.740
I mean for gyms like we already have the whole system but for us to start

516
00:39:10.740 --> 00:39:14.060
from scratch and build the whole team and figure out how to find the data

517
00:39:14.060 --> 00:39:16.340
because like it's not just trying to find the weight loss like a lot of people

518
00:39:16.340 --> 00:39:19.260
are overweight not a lot of people are gym owners so there's you know it's

519
00:39:19.260 --> 00:39:23.460
different it's B to C versus B to B but we had to figure out okay where do we find

520
00:39:23.460 --> 00:39:26.660
the data how do we clean the data how do we create these lists you know what

521
00:39:26.660 --> 00:39:29.540
software do we used to cold call and what's the script what's the hook what do we

522
00:39:29.540 --> 00:39:32.540
say on the opener how do we train the team where do we recruit from how do we

523
00:39:32.540 --> 00:39:35.340
compensate these people how do we set up the sales process at a two step or

524
00:39:35.340 --> 00:39:37.540
three step like all those things are things that we had to figure out from

525
00:39:37.540 --> 00:39:42.460
scratch and it took us about 90 days to figure it out so but now that we have it

526
00:39:42.460 --> 00:39:47.140
it's actually really great and it's just really cool having two things that are

527
00:39:47.140 --> 00:39:52.660
really firing side by side between inbound and outbound I wrote this one

528
00:39:52.660 --> 00:39:58.020
again but simple scales and so simple like really trying to figure out at all

529
00:39:58.020 --> 00:40:04.340
levels the simplest solution not like oftentimes the best solution is not the

530
00:40:04.340 --> 00:40:07.940
best solution because it is more complex and the simplest solution though it

531
00:40:07.940 --> 00:40:11.980
might not be the best solution becomes the best solution because it is actually

532
00:40:11.980 --> 00:40:16.100
able to be realized and so that is a lesson that I have learned in 2020 more

533
00:40:16.100 --> 00:40:21.540
so than any year is like we have made our product suites simpler and more

534
00:40:21.540 --> 00:40:25.420
digestible and immediately actionable and we're getting better client results

535
00:40:25.420 --> 00:40:28.620
now than even when there was like crazy Facebook arbitrage and that took

536
00:40:28.620 --> 00:40:32.460
time you know what I mean to just learn that because I would say like a year

537
00:40:32.460 --> 00:40:36.460
and a half ago we had so much stuff inside of our product that's like it it

538
00:40:36.460 --> 00:40:39.540
could be so perfectly customized the thing is is that it was overwhelming for

539
00:40:39.540 --> 00:40:45.460
the majority of clients and so trying to to to rectify the complexity versus

540
00:40:45.460 --> 00:40:49.500
simplicity equation you know you kind of have to find the the middle ground in

541
00:40:49.500 --> 00:40:52.100
the sweet spot for what's going to serve the most people at the highest level

542
00:40:52.100 --> 00:40:56.580
and so that was just reinforced us here and honestly right now we're doing we're

543
00:40:56.580 --> 00:41:00.300
I'm I'm more proud of the gym lunch product now than I've ever been which is

544
00:41:00.300 --> 00:41:06.900
pretty cool for me another one is that you can make the right decisions and be

545
00:41:06.900 --> 00:41:11.460
wrong and you can make the wrong decisions and be right and so this is really

546
00:41:11.460 --> 00:41:17.060
hard from a learning perspective because let's say for example I bet my life

547
00:41:17.060 --> 00:41:23.100
savings on black at the at the at the casino right if it hits black was at the

548
00:41:23.100 --> 00:41:30.660
right decision probably not and so I may be rewarded for poor decision just

549
00:41:30.660 --> 00:41:37.020
like I could make a strategic bet in business that for all reasons was the right

550
00:41:37.020 --> 00:41:44.660
call and then covid hits right and then all of a sudden that's not the that

551
00:41:44.660 --> 00:41:48.220
that wasn't the quote right bet but it was the right decision given the

552
00:41:48.220 --> 00:41:55.020
information available and so things change there are market dynamics and so I

553
00:41:55.020 --> 00:41:59.620
instead of being myself of over decisions I think if all I had was the

554
00:41:59.620 --> 00:42:02.340
the decision making criteria that I had available to me at the time the

555
00:42:02.340 --> 00:42:05.700
information available to me at the time was the decision that I made the best

556
00:42:05.700 --> 00:42:10.540
decision and what I don't want to do is unlearned good habits right because

557
00:42:10.540 --> 00:42:13.660
we're constantly you know evolving and growing as entrepreneurs and so not

558
00:42:13.660 --> 00:42:18.620
unlearning good habits and and not reinforcing bad habits that have good

559
00:42:18.620 --> 00:42:23.220
outcomes is is is something that I have focused on a lot this year and so

560
00:42:23.220 --> 00:42:28.620
sometimes there are short-term trades that have long-term outcomes and I think

561
00:42:28.620 --> 00:42:32.940
this year was actually much more of a long-term focused year for us ironically

562
00:42:32.940 --> 00:42:36.740
with all the craziness that was going on we put a lot of foundational stuff in

563
00:42:36.740 --> 00:42:43.260
place that I think is really setting the stage for 2021 so pump for that and I

564
00:42:43.260 --> 00:42:47.020
would say my there's there's more to this but I'll probably end on this note

565
00:42:47.020 --> 00:42:58.100
which is understanding an expanded time horizon has been immeasurably

566
00:42:58.100 --> 00:43:02.660
valuable for me and this is one of those things where you hear it all the time

567
00:43:02.660 --> 00:43:08.820
right but it doesn't become real for you and I feel like it became real for me

568
00:43:08.820 --> 00:43:15.300
this year which was I'm independently wealthy I don't need any more money for

569
00:43:15.300 --> 00:43:19.220
the rest of my life if we grow our current net worth at 10% a year will be

570
00:43:19.220 --> 00:43:22.740
worth several hundred million dollars half a billion dollars by the time of

571
00:43:22.740 --> 00:43:28.060
60 and so that probably means I won't need anything I could stop working now

572
00:43:28.060 --> 00:43:36.020
right and that allows me to think from a slightly different perspective but a

573
00:43:36.020 --> 00:43:38.740
thing is is that I think the reason that the rich get richer is because it

574
00:43:38.740 --> 00:43:42.140
allows them to think from this perspective and so the hardest thing is trying to

575
00:43:42.140 --> 00:43:45.940
get yourself into this and so I'm making like this is if there's anything that

576
00:43:45.940 --> 00:43:50.820
you listen to in this entire video it is what I'm about to tell you if you can

577
00:43:50.820 --> 00:43:56.700
expand your time horizon beyond months and even a year or two you will be so

578
00:43:56.700 --> 00:44:03.700
much better off if you expand your time horizon beyond just a month or a year

579
00:44:03.700 --> 00:44:09.060
and actually start thinking in five year and ten year terms you will be so

580
00:44:09.060 --> 00:44:15.180
much better off and I think there's there's so many reasons for that one is when

581
00:44:15.180 --> 00:44:19.780
you bet on long enough time horizons you can virtually get rid of risk and if

582
00:44:19.780 --> 00:44:26.980
you can make risk-free guaranteed upside then why would you not make those

583
00:44:26.980 --> 00:44:31.020
bets the reason at Warren Buffett said this he said no one wants to get rich

584
00:44:31.020 --> 00:44:35.460
slow right but I would rather get rich for sure than get rich fast and lose it

585
00:44:35.460 --> 00:44:39.540
right or more realistically for many try and get rich fast for my entire life

586
00:44:39.540 --> 00:44:42.740
rather than just saying well if I just did this for ten years I'd be guaranteed

587
00:44:42.740 --> 00:44:46.460
to be a millionaire and I think that is the issue and I think that's the problem

588
00:44:46.460 --> 00:44:50.780
that the world has and that's why most people will never become wealthy is

589
00:44:50.780 --> 00:44:56.380
because they cannot delay their impatience they cannot delay their gratification

590
00:44:56.380 --> 00:45:02.740
and so for me when I'm thinking about our businesses I'm now really thinking

591
00:45:02.740 --> 00:45:05.940
like do I think and this is because I've been reading a lot about investor

592
00:45:05.940 --> 00:45:09.380
stuff and I'm like you know private equity firms will come in and their goal

593
00:45:09.380 --> 00:45:14.260
will be to double accompany you know in in five years right double accompany in

594
00:45:14.260 --> 00:45:18.940
five years and I think about that with like Jim launch and there's so many times

595
00:45:18.940 --> 00:45:22.020
where I'm like oh we got a double this year why didn't we double but if I'd

596
00:45:22.020 --> 00:45:27.660
said like we just got a double in five and made the plan for that the plan

597
00:45:27.660 --> 00:45:32.380
would look so much different and also so realistically attainable that I

598
00:45:32.380 --> 00:45:37.300
think we'd probably over perform that but what it would do is eliminate the

599
00:45:37.300 --> 00:45:43.020
needless frenetic energy of oh we gotta do this now we gotta you know like

600
00:45:43.020 --> 00:45:46.260
craziness of the shifts in the turns and and like sure there's always things that

601
00:45:46.260 --> 00:45:51.100
you have to adapt in the marketplace but it just gives you this steadiness as

602
00:45:51.100 --> 00:45:56.460
a leader and when you can look at five year goal but like I've never even

603
00:45:56.460 --> 00:46:01.340
believed in five year goals as a from a goal perspective but I think of it in

604
00:46:01.340 --> 00:46:05.820
terms of a timeline perspective of like how am I measuring myself like when I

605
00:46:05.820 --> 00:46:09.460
think about where I was five years ago it's not it's like not even

606
00:46:09.460 --> 00:46:12.780
comprehensible and so I mean I hope to have that kind of difference five years

607
00:46:12.780 --> 00:46:21.180
from now we'll see but I think that if I can take a more steady approach a more

608
00:46:21.180 --> 00:46:29.060
disciplined approach to growth and to value creation within the company

609
00:46:29.060 --> 00:46:33.420
everything that I've read about you know value-based investing and how you

610
00:46:33.420 --> 00:46:36.420
know companies do turn around which is really valuable if you ever you know

611
00:46:36.420 --> 00:46:40.460
want to get into a reading topic look at you know by buying and buying and

612
00:46:40.460 --> 00:46:43.860
flipping businesses because you look at what they're looking at in the

613
00:46:43.860 --> 00:46:46.980
businesses what they can do to improve and so you can basically come in with

614
00:46:46.980 --> 00:46:50.260
fresh eyes to your own business and think like what would I do if I were buying

615
00:46:50.260 --> 00:46:52.660
my business fresh from day one today which is actually a really good thought

616
00:46:52.660 --> 00:46:56.900
exercise and so I've kind of walked through that process and the things that I

617
00:46:56.900 --> 00:47:01.620
would do are different than what I'm actually doing and so by expanding it to

618
00:47:01.620 --> 00:47:06.660
an investor's time horizon I feel like I'm making much better decisions and I

619
00:47:06.660 --> 00:47:13.740
have much better perspective and it's been it's just incredibly calming because

620
00:47:13.740 --> 00:47:16.540
I think the reason that entrepreneurs you know the double-edged sort of us is

621
00:47:16.540 --> 00:47:20.260
that we're emotional people we you know we I get so excited and then we all

622
00:47:20.260 --> 00:47:23.340
these ideas and we want to do all of them and the reality is that you can't you

623
00:47:23.340 --> 00:47:27.060
just can't you can't even do can't even do most of them you can do a very very

624
00:47:27.060 --> 00:47:31.740
very small percentage of them and when a private equity buyer for example

625
00:47:31.740 --> 00:47:36.220
comes into trying to buy a business and improve it they will I'll tell you

626
00:47:36.220 --> 00:47:38.620
actually you know I'll tell you what this has been really enlightening for you

627
00:47:38.620 --> 00:47:40.860
so I'll tell you what they do so the first thing they do is they create a

628
00:47:40.860 --> 00:47:46.260
hundred-day plan and the objective that hundred-day plan is to align the

629
00:47:46.260 --> 00:47:50.020
economic interest of the management with the fund who in the investor who's

630
00:47:50.020 --> 00:47:54.220
buying it right and the way they do that is they first figure out what their

631
00:47:54.220 --> 00:48:00.900
primary two to three KPIs are going to be that's it two to three and then

632
00:48:00.900 --> 00:48:05.620
they figure out how to accurately and meticulously track those things so

633
00:48:05.620 --> 00:48:10.300
typically you know investors are known for you know cutting costs and

634
00:48:10.300 --> 00:48:16.540
increasing profits that's like a standard thing that they'll do but they

635
00:48:16.540 --> 00:48:20.700
increase the cost on IT and reporting and diligence and so for me thinking

636
00:48:20.700 --> 00:48:24.660
about that it's like okay that just really shows how important the data and

637
00:48:24.660 --> 00:48:27.940
reporting is which is kind of what I was alluding to earlier and so they

638
00:48:27.940 --> 00:48:31.660
implement implement a lot of ERP's and CRM systems that they already have you

639
00:48:31.660 --> 00:48:35.740
know test and whatnot to get the tracking in real time around their KPIs now

640
00:48:35.740 --> 00:48:39.380
the number one KPI that they track which I found incredibly interesting which we

641
00:48:39.380 --> 00:48:45.580
don't track which is wild is excess cash flow and it's crazy because that's the

642
00:48:45.580 --> 00:48:48.480
thing I care the most about as as the owner is what am I depositing my bank

643
00:48:48.480 --> 00:48:52.680
on every month but as financials become more sophisticated you look at your

644
00:48:52.680 --> 00:48:55.400
profit and your EBITDA and like all the you know your P&L and you have to

645
00:48:55.400 --> 00:48:59.520
offset revenue based on contract terms blah blah blah blah right but all I care

646
00:48:59.520 --> 00:49:02.420
about is excess cash flow and it was ironic to me that the most sophisticated

647
00:49:02.420 --> 00:49:06.120
investors you know in the world some of them right the thing that they care about

648
00:49:06.120 --> 00:49:09.560
is the thing that I care about which is just how much cash we put it off you know

649
00:49:09.560 --> 00:49:12.520
and they have different reasons for that because they can serve a step better

650
00:49:12.520 --> 00:49:14.820
they can get better leverage which means they can get better multiples and blah

651
00:49:14.820 --> 00:49:19.020
blah blah blah and they get better returns but for me thinking about that is

652
00:49:19.020 --> 00:49:21.760
something that I'm going to be reorganizing our business around which is how can

653
00:49:21.760 --> 00:49:25.980
we and and and and and aligning the incentive of the management team around that

654
00:49:25.980 --> 00:49:30.320
that KPI and so that's what they do in their first hundred days and then after

655
00:49:30.320 --> 00:49:35.760
that the only great two to three focused task forces right small teams that

656
00:49:35.760 --> 00:49:39.920
can be held accountable to big domino operational objectives that will

657
00:49:39.920 --> 00:49:44.780
provide the most value in the that have high probability of success they'll

658
00:49:44.780 --> 00:49:48.580
provide the most value to the business and so that is it and that's what they

659
00:49:48.580 --> 00:49:53.720
do and they just ruthlessly ruthlessly manage around those metrics and I think

660
00:49:53.720 --> 00:49:57.840
about that and what that means is they allow the management and leadership

661
00:49:57.840 --> 00:50:02.280
team to run the business rather than metal and I think that I definitely have

662
00:50:02.280 --> 00:50:04.960
a tendency to metal because I like doing things my way and I want things to

663
00:50:04.960 --> 00:50:09.160
sound a certain way and blah blah blah the same things all of us do and

664
00:50:09.160 --> 00:50:14.760
it's not it's not been it actually hurts the business and so because it

665
00:50:14.760 --> 00:50:18.520
removes consistency and so if we can create consistency of operations it

666
00:50:18.520 --> 00:50:23.240
creates it creates less waste right so you can be more efficient it creates a

667
00:50:23.240 --> 00:50:28.000
more consistent experience with the customers and so it allows us to make more

668
00:50:28.000 --> 00:50:33.240
profit from less waste it gives like I said more value and it allows us to just

669
00:50:33.240 --> 00:50:36.040
focus on a couple of things without feeling the constant overwhelms I actually

670
00:50:36.040 --> 00:50:41.680
think that our team etc itself would be happier with this type of approach and

671
00:50:41.680 --> 00:50:46.800
so that is how I'm kind of shifting my my perspective on our businesses now

672
00:50:46.800 --> 00:50:52.240
because we have three of them in doing that and so that's been really cool I've

673
00:50:52.240 --> 00:50:58.960
also taken on a number of small companies that I'm working with so

674
00:50:58.960 --> 00:51:05.520
companies that are doing one to five million dollars a year that are either

675
00:51:05.520 --> 00:51:12.720
you know consulting service knowledge education based businesses or niche

676
00:51:12.720 --> 00:51:16.640
brick and mortar businesses that you know have have the desire to like

677
00:51:16.640 --> 00:51:20.440
franchise or scale nationally and so those are it's just because that's that's

678
00:51:20.440 --> 00:51:24.760
the businesses that I know intimately and so I'm actually working with some

679
00:51:24.760 --> 00:51:28.840
companies there and that's crazy for me because if you think I'm from an

680
00:51:28.840 --> 00:51:34.800
investor standpoint I have a company that I just recently became an advisor to

681
00:51:34.800 --> 00:51:42.440
and they'd been at half a million dollars a year for two years I think and now

682
00:51:42.440 --> 00:51:47.160
we're doing a hundred and fifty thousand a week six months later right so

683
00:51:47.160 --> 00:51:51.120
that's from five hundred about fifty thousand dollars a month to six hundred

684
00:51:51.120 --> 00:52:00.360
thousand dollars a month right wild so pretty pretty cool very exciting and I'm

685
00:52:00.360 --> 00:52:03.200
just I'm just pumped pumped about the future I think twenty twenty ones gonna be a

686
00:52:03.200 --> 00:52:08.080
good year I think there's a lot of cash on the sidelines savings across the entire

687
00:52:08.080 --> 00:52:12.880
United States like went up a ton which means they're printing money and people are

688
00:52:12.880 --> 00:52:15.520
holding onto it which means that when people start spending that money we should

689
00:52:15.520 --> 00:52:19.960
see a boom overall I do you think that you know as we have an entirely

690
00:52:19.960 --> 00:52:24.720
democratic president you know all three houses or whatever branches the

691
00:52:24.720 --> 00:52:28.240
government are all democratic I don't think they're gonna want to not look good

692
00:52:28.240 --> 00:52:32.920
and so I think that they're gonna pump the economy as much as they can which will

693
00:52:32.920 --> 00:52:36.320
be good in the short term and we'll see in the long term as much as everyone's

694
00:52:36.320 --> 00:52:41.280
really worried about the inflation area effects which is definitely a concern

695
00:52:41.320 --> 00:52:46.000
there's also really strong deflationary effects going on right now too so I also

696
00:52:46.000 --> 00:52:50.360
think that the people who who are running monetary policy are probably more

697
00:52:50.360 --> 00:52:57.000
knowledgeable than we are literally what they do for a living full-time so just

698
00:52:57.000 --> 00:53:04.080
something consider there yeah that was a twenty twenty I have I've I've I've

699
00:53:04.080 --> 00:53:07.800
had a I hope you enjoyed this is different than the normal types of podcasts

700
00:53:07.800 --> 00:53:11.600
that I make this is kind of the the top of mind the things that have been most

701
00:53:11.600 --> 00:53:20.520
meaningful for me and I'm I think I'm in the best mental place ever been which is

702
00:53:20.520 --> 00:53:24.320
cool for me I'm not a particularly I would never have described myself as a

703
00:53:24.320 --> 00:53:31.960
particularly happy person but I'm I'm I'm pretty close to happy and I'll really

704
00:53:31.960 --> 00:53:37.200
like the word very much because I think it's it's really misleading but I'm

705
00:53:37.200 --> 00:53:42.840
really I'm really I'm pretty fulfilled I really like what I do I think I'm good

706
00:53:42.840 --> 00:53:45.920
at it so I find that fulfilling I find it challenging I love the game of

707
00:53:45.920 --> 00:53:52.320
entrepreneurship and I'm very grateful to to be able to apply you know I really

708
00:53:52.320 --> 00:53:57.960
am and I'm gonna leave you with one thing that I so I talked to my 18-year-old

709
00:53:57.960 --> 00:54:02.160
neighbor right and he's having a hard time he's got more stuff that happened

710
00:54:02.160 --> 00:54:07.160
since the last time you've heard a podcast from me just personal stuff and you

711
00:54:07.160 --> 00:54:11.680
know he's he's having trouble with the sacrifices that are required for

712
00:54:11.680 --> 00:54:15.560
entrepreneurship you know he's young he wants to have fun and and the thing is

713
00:54:15.560 --> 00:54:19.200
there's nothing wrong with that it's just the question is how bad do you

714
00:54:19.200 --> 00:54:23.040
want what you claim to want you know everybody wants a six pack it's just that

715
00:54:23.040 --> 00:54:27.280
they want donuts more right they actually want donuts they they claim to want

716
00:54:27.280 --> 00:54:31.400
a six pack but they want donuts more right and I think that that you know

717
00:54:31.400 --> 00:54:36.000
analogy is the same for business like he wants to be an entrepreneur but it's

718
00:54:36.000 --> 00:54:40.840
hard to see your friends partying and having fun and living you know they're

719
00:54:40.840 --> 00:54:46.280
they're youthful lives without you and it's easy to rationalize and say like

720
00:54:46.280 --> 00:54:50.320
why should I enjoy my youth and I'm not saying you shouldn't I'm really not I

721
00:54:50.320 --> 00:54:54.360
just know that if you you know the sooner you start investing in skills and I'm

722
00:54:54.360 --> 00:54:57.400
not saying he's gonna like investing in skills is the thing right what he does

723
00:54:57.400 --> 00:55:01.240
to invest in the skills is irrelevant but investing in skills is how he gets

724
00:55:01.240 --> 00:55:04.440
there and putting a disproportionate amount of time towards developing the skills

725
00:55:04.440 --> 00:55:08.760
will allow him to you know outpace the competition being you know everyone

726
00:55:08.760 --> 00:55:14.520
else right and I said something that when I was 19 was a huge epiphany for me so

727
00:55:14.520 --> 00:55:21.400
I'm just gonna share it with you I was dating a girl for two years in college

728
00:55:21.400 --> 00:55:26.880
and she was very very obsessed with happiness it was like it was her major it

729
00:55:26.880 --> 00:55:29.920
was positive psychology was her major and she was really obsessed with happiness

730
00:55:30.640 --> 00:55:38.400
and she ended up being a amazing person you know what I mean but I think at at the

731
00:55:38.400 --> 00:55:46.600
base a relatively sad person and and I know that when we split up and during that

732
00:55:46.600 --> 00:55:50.680
time because you know people rub off on you I I had become really really

733
00:55:50.680 --> 00:55:53.680
interested in happiness how do I optimize for happiness every it does this

734
00:55:53.680 --> 00:55:57.720
make me happy like all this stuff and I think happy is a horrible term I think

735
00:55:57.720 --> 00:56:04.920
it's a horrible term I think it poisons so many people you know and I remember

736
00:56:04.920 --> 00:56:09.160
you know because you you're kind of emotional and you're younger and probably

737
00:56:09.160 --> 00:56:16.200
emotional and our older words better hiding it but when we split up she and I

738
00:56:16.200 --> 00:56:20.560
and I and I had these habits of you know reading all this positivity stuff and

739
00:56:20.560 --> 00:56:24.200
blah blah and and I just remember going to this place where I was just like

740
00:56:24.720 --> 00:56:33.400
fuck happiness I'm just gonna win and that became my new kind of operating

741
00:56:33.400 --> 00:56:37.120
standard I was like fuck happiness like I'm just gonna move I'm gonna take so

742
00:56:37.120 --> 00:56:39.960
much action that I don't have to think about it I don't have to think I don't

743
00:56:39.960 --> 00:56:43.760
have to be alone with my thoughts right I'm just gonna keep moving and I'm just

744
00:56:43.760 --> 00:56:46.480
gonna keep getting better and I'm gonna keep making progress I don't care

745
00:56:46.480 --> 00:56:53.120
from happy and a weird thing happened once I stopped obsessing about happiness

746
00:56:53.120 --> 00:56:59.000
actually think that I became more content because the thing is as I was

747
00:56:59.000 --> 00:57:03.160
constantly measuring myself before that to this what I would say that you know

748
00:57:03.160 --> 00:57:10.840
what consider an unrealistic expectation of the human existence and always

749
00:57:10.840 --> 00:57:17.360
finding myself deficient and so the desire for happiness creates an

750
00:57:17.360 --> 00:57:27.360
unfulfilled expectation that makes me unhappy and disregarding happiness gives me

751
00:57:27.360 --> 00:57:34.640
permission to not give a fuck and if I happen to be happy or enjoy a moment or

752
00:57:34.640 --> 00:57:42.840
or find fulfillment in my work then it becomes above my expectation and so I

753
00:57:42.840 --> 00:57:46.880
have a positive experience and so one of the biggest things that I have worked

754
00:57:46.880 --> 00:57:50.360
on and this is what I was talking to my 18 year old neighbor about was the only

755
00:57:50.360 --> 00:57:55.240
reason that you were upset right now is because of a fictitious expectation that

756
00:57:55.240 --> 00:57:59.720
you arbitrarily made up in your mind that you are not reaching that you made up

757
00:57:59.720 --> 00:58:03.440
it's like if I said I wanted to gain 20 pounds of muscle in seven days and then

758
00:58:03.440 --> 00:58:06.040
was upset that I didn't gain 20 pounds of muscle in seven days because I worked

759
00:58:06.040 --> 00:58:10.520
out hard it's the same thing right I was like you want to be a millionaire in your

760
00:58:10.520 --> 00:58:15.520
19 I was like do you feel like it's reasonable that you think that after two

761
00:58:15.520 --> 00:58:21.080
months of beginning your entrepreneurial journey that you don't earn above the

762
00:58:21.080 --> 00:58:27.240
top one percent in the United States like do you feel like it's reasonable that

763
00:58:27.240 --> 00:58:33.360
after eight weeks of not being in school that you are not in the top one

764
00:58:33.360 --> 00:58:37.400
percent he was like well when you say it like that and I was like right but

765
00:58:37.400 --> 00:58:42.280
that's what you're thinking you're thinking like that right and so this kind of

766
00:58:42.280 --> 00:58:44.800
goes full circle with what I was saying earlier about having the extended

767
00:58:44.800 --> 00:58:51.240
time horizon if we can extend our horizons then we decrease our own expectations

768
00:58:51.240 --> 00:58:58.120
and by doing so we increase our fulfillment by default because we expect less

769
00:58:58.120 --> 00:59:04.520
or nothing and while we increase our fulfillment during the process we

770
00:59:04.520 --> 00:59:12.200
actually get better faster and that was what I have him having him focus on is

771
00:59:12.200 --> 00:59:16.280
like why don't we say what's a five-year goal that we believe is reasonable and

772
00:59:16.280 --> 00:59:21.560
let's make it action-based all right so instead of I want to make four hundred

773
00:59:21.560 --> 00:59:26.480
thousand dollars a year in five years why don't we say what skills will I need

774
00:59:26.480 --> 00:59:29.120
to have that would allow me to make four hundred thousand dollars a year and

775
00:59:29.120 --> 00:59:32.760
then what actions would I need to take to acquire those skills that would be

776
00:59:32.760 --> 00:59:38.160
reasonable even with poor talent that I would achieve that and so for example we

777
00:59:38.160 --> 00:59:42.120
determined that lead generation and sales if he wants to be an entrepreneur it

778
00:59:42.120 --> 00:59:46.720
would be valuable skills and so I said okay how do you think that we can go

779
00:59:46.720 --> 00:59:51.200
about guaranteeing virtually that you will have those skills and he's like well

780
00:59:51.200 --> 00:59:55.640
you know reps and I was like right so how do we get reps in and how many reps do

781
00:59:55.640 --> 00:59:57.760
we feel like are reasonable right I was like do you feel like if you do make

782
00:59:57.760 --> 01:00:02.520
25,000 calls this year which is a hundred calls a day it's just 500 calls

783
01:00:02.520 --> 01:00:06.560
times 52 weeks right you think you make 25,000 calls to be you'll be able to

784
01:00:06.560 --> 01:00:10.480
prospect and get business he's like yeah I think after 25,000 calls that would

785
01:00:10.480 --> 01:00:15.040
be reasonable like cool great so that's one year next year what do we do do you

786
01:00:15.040 --> 01:00:20.560
think if you took you know you know 2020 high-tech you know calls a week over

787
01:00:20.560 --> 01:00:26.200
52 weeks you know a thousand high-tech phone call closes you would be able to

788
01:00:26.200 --> 01:00:31.080
be at least proficient in sales he's like yeah I think I could do that like okay

789
01:00:31.080 --> 01:00:34.320
we're we still have three years left on this on this timeline but I can tell

790
01:00:34.320 --> 01:00:36.680
you right now if you can generate leads and you can prospect for your own

791
01:00:36.680 --> 01:00:40.800
thing and you can sell at high-tech amounts you can make 400,000 a year no

792
01:00:40.800 --> 01:00:43.920
problem but we're only two years in what else we're gonna need he's like well I

793
01:00:43.920 --> 01:00:46.400
don't know what I'm selling I'm like that's great so then we have to develop a

794
01:00:46.400 --> 01:00:49.920
skill that's valuable right and so at that point I was like I'm not gonna make

795
01:00:49.920 --> 01:00:52.600
that goal right now we're gonna just develop these first two and then after that

796
01:00:52.600 --> 01:00:57.520
we're gonna go develop the other ones and so I hope these kind of anecdotes

797
01:00:57.520 --> 01:01:02.480
about my 18 year old neighbor are are useful for you it's really it's

798
01:01:02.480 --> 01:01:05.120
honestly been one of the it's honestly been one of the most rewarding things

799
01:01:05.120 --> 01:01:11.120
for me because I feel like I get to live I can I can help someone not you know

800
01:01:11.120 --> 01:01:14.520
suffer as much as I did during that process and really shortcut the the whole

801
01:01:14.520 --> 01:01:22.040
path to success anyways I love you guys for listening this is I you know I

802
01:01:22.040 --> 01:01:25.560
appreciate those of you who find this valuable this is really just my

803
01:01:25.560 --> 01:01:30.280
mental diary for myself so that I can look back you know and maybe maybe

804
01:01:30.280 --> 01:01:33.840
hopefully you know in decades to come up I'll be among the the billionaire

805
01:01:33.840 --> 01:01:37.960
bros who donates their their life life's net worth to some meaningful cause

806
01:01:37.960 --> 01:01:42.400
and they'll be like dude you gotta listen to her most these old stuff and so

807
01:01:42.400 --> 01:01:47.360
hopefully that's what these are so anyways I appreciate you all I'm

808
01:01:47.360 --> 01:01:51.200
focusing on simple I'm focusing on longer time horizons I'm focusing on

809
01:01:51.200 --> 01:01:55.320
finding good people I'm focusing on getting them focused on just a handful of

810
01:01:55.320 --> 01:02:02.680
things and just driving those and doing living a boring but steady business

811
01:02:02.680 --> 01:02:11.320
life and trying to come into it with no expectations and and being

812
01:02:11.320 --> 01:02:15.920
pleasantly surprised about anything that happens and so that is that is my

813
01:02:15.920 --> 01:02:20.840
outlook and I know that the world has been rough my recommendation is to turn

814
01:02:20.840 --> 01:02:27.120
off all media it I turned off I removed all the media from my phone because I

815
01:02:27.120 --> 01:02:31.280
thought it was especially overwhelming and I realized that my life was really

816
01:02:31.280 --> 01:02:37.960
the same without all of the news so hopefully that's I before you and I know

817
01:02:37.960 --> 01:02:41.080
that the news does not make me more money and I also know that the news does not

818
01:02:41.080 --> 01:02:45.080
help me prepare for what is to come independently because I think to myself

819
01:02:45.080 --> 01:02:47.720
well what would I do differently than I'm currently doing if these things

820
01:02:47.720 --> 01:02:49.880
would happen and the answer is nothing which means it's not really

821
01:02:49.880 --> 01:02:53.120
providing me value and if it's like well I need to stay informed if there's

822
01:02:53.120 --> 01:02:59.640
anything major I'll find out I don't need to go surf the news to go do that so

823
01:02:59.640 --> 01:03:05.200
anyways 2021 I think it's gonna be a good year for a lot of us I think a lot of

824
01:03:05.200 --> 01:03:09.080
people grew a lot in 2020 and so as a result their businesses will grow in

825
01:03:09.080 --> 01:03:12.480
2021 like they personally grew I personally grew more in 2020 than I did in

826
01:03:12.480 --> 01:03:17.680
any other year and I think that we're gonna we're gonna I think the result of

827
01:03:17.680 --> 01:03:23.520
that it's going to show in 2021 so keeping amazing and keeping awesome lots of

828
01:03:23.520 --> 01:03:28.880
love and I will catch you guys in the next vid bye