7 Millionaires Asked Me How to Get Rich
Summary
TLDRIn this business-focused transcript, a group of high-earning professionals discuss strategies for scaling their ventures. Topics range from niche market dominance, potential for roll-ups in the medical sector, to the challenges of maintaining revenue retention in various industries. The conversation touches on the importance of branding, customer acquisition, and the shift from service-based to product-focused businesses, highlighting the need for a strong value proposition and market understanding to achieve significant growth and scalability.
Takeaways
- 😀 The room consists of individuals making between $1 million to $12 million per year, discussing business scaling strategies.
- 📈 A participant with a neuropathy business is doing $5 million yearly and is considering scaling or selling the business.
- 🏥 The neuropathy niche is small with around 2,000 doctors, and the participant's business has engaged with 160 of them, indicating significant growth potential.
- 💰 The discussion suggests that the ultimate business model could involve rollups, where similar businesses are consolidated for efficiency and higher valuations.
- 🤔 The idea of selling the business is appealing, but it would require expanding to different verticals to increase its value.
- 📊 A business model involving 160 clinics generating an average of $3.2 million per year in revenue is presented, highlighting the potential for growth.
- 💡 The concept of 'rollups' in the info and agency space is introduced, where the aggregation of similar businesses can lead to significant value creation.
- 🏘️ A real estate flipping business in Missouri with $15 million in revenue and a net profit of $2.5 million after overheads is discussed.
- 🚀 The real estate business is at a crossroads, considering whether to expand within the current market or pivot the business model due to market saturation.
- 🛠️ The importance of learning new skills, such as advertising, is emphasized for business growth and to stay competitive in the market.
- 🌐 A software company that helps content creators produce more engaging short videos using AI has grown to $5 million in revenue and aims for $20 million in the next year.
Q & A
What is the annual revenue range discussed for the individuals in the room?
-The annual revenue range discussed for the individuals in the room is between $1 million and $12 million per year.
What is the business model that the person doing $5 million a year is using?
-The person doing $5 million a year is using a scheduling model, specifically for neuropathy treatments, which includes services like diabetic dinners.
What is the niche market discussed in the script?
-The niche market discussed in the script is neuropathy clinics, with approximately 2,000 doctors specializing in neuropathy, out of which 160 are part of the discussed business model.
What is the potential for scaling the neuropathy business according to the script?
-The potential for scaling the neuropathy business is significant, as there is a large untapped market with only 160 out of 2,000 neuropathy clinics currently involved in the business model.
What is the concept of 'rollups' in the context of the business model discussed?
-In the context of the business model discussed, 'rollups' refer to the consolidation of similar businesses, such as neuropathy clinics, to leverage shared marketing, pricing, packages, and operational efficiencies, potentially leading to a more significant exit strategy.
What is the average revenue generated per year by the neuropathy clinics involved in the business model?
-The average revenue generated per year by the neuropathy clinics involved in the business model is estimated to be around $3.2 million, using an average calculation.
What is the main challenge faced by the person running the permanent holiday lighting business?
-The main challenge faced by the person running the permanent holiday lighting business is the lack of revenue retention and the need to upsell additional services or maintenance plans.
What is the average ticket price for the permanent holiday lighting installations?
-The average ticket price for the permanent holiday lighting installations is about $5,000.
What is the Customer Acquisition Cost (CAC) for the permanent holiday lighting business?
-The Customer Acquisition Cost (CAC) for the permanent holiday lighting business is $300.
What is the main constraint for the residential real estate flipping business in Missouri?
-The main constraint for the residential real estate flipping business in Missouri is the saturation of the local market within a 4-hour driving radius and the need to decide whether to expand to new cities or pivot the business model.
What is the annual revenue of the software company called 'Sub Magic'?
-The annual revenue of the software company 'Sub Magic' is currently at $5 million, with plans to reach $20 million in the next year.
What is the main challenge for the accounting firm discussed in the script?
-The main challenge for the accounting firm discussed in the script is operations, ensuring client satisfaction during the high-demand tax season, and improving the sales process to charge a premium for the value provided.
What is the annual churn rate for the accounting firm?
-The annual churn rate for the accounting firm is around 15%, which is considered high in the context of their business.
What is the main focus for scaling the DTC fashion brand in Indonesia?
-The main focus for scaling the DTC fashion brand in Indonesia is to determine when to expand into new product lines, such as women's or sportswear, to increase the brand's market reach and value.
What is the current revenue for the DTC fashion brand in Indonesia?
-The current revenue for the DTC fashion brand in Indonesia is $1 million per year, with plans to scale to $3 million.
What is the primary business model for the DTC fashion brand in Indonesia?
-The primary business model for the DTC fashion brand in Indonesia is to design and market their own brand of casual wear for men, manufactured by a contracted factory.
Outlines
🤝 Scaling Business Strategies in a High-Earning Room
The paragraph discusses a business meeting with individuals earning between $1 million to $12 million annually. The focus was on scaling their businesses, with a particular interest in a neuropathy clinic model. The speaker explores the potential for growth within niche markets, suggesting strategies like rollups for increased profitability. The conversation delves into the idea of selling the business to different verticals and the importance of cash flow, with an emphasis on the potential for significant revenue growth through strategic business moves.
💡 Exploring Revenue Retention and Business Expansion
This paragraph delves into the challenges of revenue retention and business expansion. The speaker discusses a business specializing in holiday lighting installations, which faces the issue of no recurring revenue. Ideas are proposed to increase customer retention, such as offering seasonal lighting services and maintenance plans. The conversation also touches on the potential for upselling and the importance of establishing a reliable revenue stream through repeat business.
🏠 Residential Real Estate Flipping and Market Saturation
The speaker from a residential real estate flipping company in Missouri shares their experience of achieving $15 million in revenue with a profit of $3.7 million. They discuss the constraints of market saturation and the reliance on foreclosures for property acquisition. The paragraph explores potential strategies for expansion, such as moving into new markets or adopting a franchise model, while considering the risks associated with an unstable deal flow due to economic fluctuations.
🛠 Advertising and Business Model Analysis for Growth
The speaker suggests a strategy for a software company that helps creators make short-arm content more captivating through AI. The focus is on growing from $5 million to $20 million in revenue. The paragraph discusses the importance of learning from successful advertising models and implementing them effectively. It also emphasizes the need for detailed analysis of competitors and improving the business model to increase sales and retention.
📈 Content Creation Software and Market Penetration
The paragraph features a discussion about a content creation software that simplifies the process of making short videos. The company has grown from $0 to $5 million in revenue in 12 months and aims to reach $20 million in the next year. The conversation highlights the importance of understanding the target market, which includes coaches, school marketers, and agency owners. The speaker also addresses the challenges of high churn rates and the need to identify and cater to the ideal customer base.
🔍 Prioritizing Revenue and Client Satisfaction in Accounting
This paragraph focuses on a CPA firm that has transitioned to a virtual setup, serving all 50 states. The firm has a revenue of $2.5 million with a net profit of $900,000. The speaker discusses the challenges of prioritizing revenue, maintaining client satisfaction during tax season, and the need to improve the sales process to charge a premium for services. The importance of effective onboarding and communication with clients is emphasized to ensure they perceive the value in the services provided.
📊 Enhancing Customer Retention and Onboarding in Accounting Services
The speaker provides insights on improving customer retention and refining the onboarding process for an accounting firm. They suggest that frequent and personalized communication with clients can enhance the perception of value and reduce churn. The paragraph also touches on the idea of hiring experts who can provide specialized tax knowledge and contribute to the firm's growth and reputation.
🛑 Lessons from Allen: Focusing on Product Business Fundamentals
The speaker reflects on the lessons learned from Allen, emphasizing the importance of focusing on the product business fundamentals rather than just marketing and sales. The paragraph discusses the need for a strong product that retains customers and the strategy of understanding and catering to the most valuable customers. The conversation also highlights the importance of saying no to less profitable opportunities in order to focus on growth and customer retention.
👕 DTC Fashion Brand Expansion and Brand Identity
The final paragraph features a DTC fashion brand from Indonesia that is considering expanding its product line. The company is currently focused on men's casual wear and is exploring the idea of adding women's or sportswear lines. The speaker advises on the importance of building a strong brand identity and understanding the brand's target market before expanding. They also discuss the potential for high growth and profitability by focusing on a specific niche within the retail market.
Mindmap
Keywords
💡Neuropathy
💡Scaling Business
💡Niche Market
💡Revenue Retention
💡CAC (Customer Acquisition Cost)
💡LTV (Lifetime Value)
💡Rollup
💡Affiliate Marketing
💡Churn Rate
💡SaaS (Software as a Service)
💡Brand Identity
Highlights
The room consists of individuals making between $1 million to $12 million per year, discussing business scaling strategies.
A model for neuropathy clinics is discussed, highlighting a niche market with significant growth potential.
The concept of a 'roll-up' strategy for niche businesses is introduced, aiming for market consolidation and increased value.
A discussion on revenue retention and customer acquisition strategies for a permanent holiday lighting business.
Insights on the importance of upselling and creating reoccurring revenue streams for service-based businesses.
A residential real estate flipping company's strategy for market dominance and expansion considerations.
The dilemma of pushing further in the current market versus pivoting the business model for a CPA firm.
The value of improving sales processes and customer communication for increasing client retention in accounting firms.
A software company's growth from $0 to $5 million in 12 months, focusing on AI-driven short-form content creation.
The challenge of customer churn and strategies for identifying and serving the ideal customer base better.
A DTC fashion brand's considerations for expanding into new product lines like women's and sportswear.
The importance of building a strong brand identity to increase conversion rates and customer loyalty.
A framework for analyzing successful brands and identifying key strategies for business growth and scalability.
The potential for a men's wear company to become a massive brand without diversifying into other demographics.
The necessity of understanding one's brand identity and the market positioning for effective business growth.
Strategies for identifying skill deficiencies and opportunities for improvement in business operations.
The discussion on the importance of endorsements and brand ambassadors in building a recognizable retail brand.
Transcripts
everybody in this room is making between
$1 million per year and $12 million per
year and we just talked for the last 60
Minutes on how to scale their business
enjoy all right so you got neuropathy um
you're doing 5 million year what's the
model uh done for you scheduling okay Le
okay is it local neuropathy stuff yeah
so diabetic dinners and all that jazz
dinners and yeah familiar with the model
okay um so then what's the what's the
what's the big play uh our
we're we're niched pretty well like I
think we're probably the biggest in our
Niche um it's a smaller group meaning
like there's maybe 2,000 doctors that do
neuropathy
specifically um so and we have 160 of
them so it's not we're still there's
still huge potential for us to I think
we get 300 or 500 or th000 maybe I don't
know what's the Ang go for you
um I'm I'm just cash okay yeah yeah no I
I asked because it's like is it to build
it to sell it is it to have yeah I mean
I think selling would be cool it has to
it have to go to different verticals I
mean I'm like I'm way too risky on the
checklist oh not necessarily I mean cuz
the thing is is like the the ultimate
version of the model that you have is
like you've got 160 out of like 2,000
neuropathy clinics right so you've got
like pretty decent you know you got
whatever that is 8% um of that like
pseudo of like niche of a niche of a in
Market but those guys make how much
these these guys make a year like um uh
between a million and 5 million right
and so this is where this gets like way
more interesting in my opinion so it's
like you've got 320 million year I'm
just using an average right per year
that you're driving in revenue and it's
like man I'm making five I'm like this
sucks right of
that you're like how can I get more of
that um and so
the thing is is like I think the the
ultimate version for like the the quote
info and agency space that I know those
are different things but fundamentally
they serve Niche Niche avatars that are
B2B um the ultimate version of those
businesses is
rollups of the the customers you serve
because if you think about what like a
rollup does I don't how familiar you are
with it but like you get everyone on the
same marketing you get everyone on the
same price points you get everyone on
the same packages you get basically you
consolidate what everyone's operations
are and that's what the majority of
super Niche agencies and kind of in info
Consulting whatever you want to call it
do with businesses so they do all the
heavy work of integration for what a
rollup would do and then they just say
like okay I'll stop there I just won't
like actually push it over the edge and
monetize the whole thing um and so like
most of the Physicians that I know hate
being Physicians they do it purely to
make money and want to be out of it as
soon as possible and so like selling
them on the idea that like okay your
practice does you whatever 2 and a half
million a year of Topline and whatever 1
million in profit uh that's awesome and
then you have your you know taxes that
you're taking home 600k year after that
like that's great but what if and on
your own this thing could maybe sell for
I don't know 3 million bucks maybe like
maybe if you're really really you know
we're being really generous but if you
were part of a group of Physicians that
were a neuropathy you know thing
Nationwide uh we could probably sell for
like your thing could probably sell for
10 million and so all I'm asking for is
a you know 20 to 30% slice of that but
times
160 and so obviously of the 160 you
wouldn't do with all of them I mean if
you did that would be a monster deal but
like if you could get like 10 or 20 of
them to roll together because they all
probably do have enough like enough
profit together to be meaningful so it's
like if you get the roll up to be like1
to $20 million in terms of profit that
would be a meaningful exit that would be
probably like a 100 to $200 million exit
and you have 20 to 30% of that but then
after that point you're now the guy who
did that and so then your whole
reputation changes your Dynamic changes
around pricing you're a long-term stick
all of that kind of stuff changes
because it's like oh I'm the guy that
can get you to hear and that's also the
like get rich know if you don't have to
do this again which is a much more
compelling offer can I ask you a side
question you guys uh
when you switch to licensing so I
remember I know o OG flying around and
then more less OG they were flying
around for you and then more recent them
doing it for for themselves right and I
gave them the ads that we test yeah
right so the the transition for you from
doing it for them to doing it to then
doing it themselves and you being a
coach does that I would never use that
word but yeah yeah does that work do you
think that that looking back would you
would you have done it that exact same
way would you have switched to the
licensing model and like and is that
what you're calling licensing joke I
mean because like we had ads that we
would test every month and then we would
just let everybody else use them and
tons of people tried to use them that
weren't are because they would copy the
gyms that we had ads and they'd like I'd
have ads gyms using my face to run ads
for their gym it happened all the time
so um would I do the model we had again
yes the reason that we didn't do done
for you was two things one is or like
the reason do it yourself for your
avatar doesn't work is that they make
too much money yeah a gym owner the
value of learning the skill exceeds
their current skill it makes more sense
for somebody who makes $35,000 a year to
learn how to Market and sell than
somebody who makes a million dollar here
to learn how to Market and sell they've
already leveled out of that in terms of
like because they can pay somebody less
than they make to do this for them
whereas the gym owner can't it makes
sense for them to learn that skill
and then from the reason I didn't do a
rollup is because group based service uh
there's zero there's zero market for it
no one wants to buy them if I had been
in a market where people were buying for
like for sure I would be I would that
would have been the model I would do
beautiful yeah out of respect for I'm
going to rock and roll does that make
sense sweet yeah so we do permanent
holiday lighting that's R off a
Smartphone um on homes and businesses um
my question I guess would be or I guess
our constraints we have no Revenue
retention um and so we've dabbled with
you know maybe doing like a a
maintenance plan you know where we
upsell people things like that um or you
know having paid subscriptions in our
app but so who's your customer most of
the time uh it's kind of a it's a
healthy split between like elderly and
then like people want to keep up with
the
Jes okay and so the light so tell me
more about like tell me more a little
bit more about the product is have a
better understanding of it yeah so
basically um we install an aluminum
track system into their existing soft
and it's got LEDs and so you can do any
holiday game day accent lighting it's
all right that is that like the Philips
hu type type deal I don't want to like
oversimplify what you're saying I just
want to make sure I understand it it's
kind of like that it's much bigger
cooler what's the average ticket uh
about 5,000 okay how do you get
customers um through Facebook and I
guess met ads but ads you didn't paid
ads in your local yeah okay got it how
many locations just one okay one
location what are margins
um we're about
60% depends on the season um so you make
you make a million bucks you keep 600 no
well we checked about 51 okay great
you're doing half awesome what's
CAC um 300 300 bucks for 5,000 LTV
that's great okay so um so a couple
things so if you want to get Revenue
retention um you want to measure how
long youve been in business so I've been
with the company for a year okay about
two years first year was just you know
vetting products out and stuff got it
but do you own it yeah okay got it okay
you said been with the company so I was
like I don't know what that means I've
been with the acquisition. comom as well
um um okay so uh so again we're thinking
about this from a revenue retention
perspective um one is is there so you
install this thing for the lighting um
what else do those people want like
is there anything else you can add on
top of it because like you have to
Keeping Up With the Jones I'm sure that
during certain Seasons they want to do
other razzled Dazzle things and so like
you can you can assemble and then
disassemble things multiple times a year
uh for seasons for Super Bowls for
things like that I don't know if that's
too different from the type of lighting
that you currently do but like it's not
too different now I get people asking
all the time if we'll do their trees or
if we'll do you know other stuff that's
not permanent yeah so I would see the
impermanent lighting as like you run two
to three seasonal campaigns a year so
I'll bet you Easter would be one if
you're in Utah I'm sure that'll be big
Christmas will obviously be big in Utah
um and then you know pick your third
date maybe maybe Halloween's not as big
in Utah um I don't know I'm just I'm
just messing around um but even if you
had you know one or two cracks at the
Apple um cracks at the Apple whatever
bites of the Apple uh every year on top
of that that keeps you top of mind and
then like when you go there you're like
hey we also do it like we'll do standard
double check is everything working okay
with the lights it gives you UPS
opportunities but you still like
generate other revenue and then when
they want to replace it's like hey did I
tell you about the new lights cuz these
ones are old now the new ones are oh my
God let me tell you let me show this
thing on my phone I did for your
neighbor Susan down the road hers looks
sick didn't know if you're interested in
that um so it's like those become UPS
opportunities and instead of saying like
it's um recurring it becomes reoccurring
so it's slightly different so like
Coca-Cola has no recurring basically no
recurring members uh member like
memberships but we buy Coca-Cola
products all the time so we have
reoccurring it's reliable Revenue it's
just not on a membership or a
subscription and so basically all you'd
have to demonstrate to make the the the
company a lot more valuable is Simply
Having the data to track that we sell a
customer for lights and we sell one out
of two another thing every year whether
that's an
upgrade a a maintenance fix or it's
lights that we do for Seasons like if we
can just show that half the people
continue to buy something from US every
year that's still
makes it a very valuable business does
that make sense that would be it so my
name is Cameron uh we do Residential
real estate flipping in the state of
Missouri uh we did 15 million Revenue
last year for
3.7 um gross before overhead so 2.5
after you take into account our team 15
meaning like the how much the houses
were when you sold them and then the
three we sold $15 million yeah it was
like house sale price the profit on each
project was 3.7 which is it helps us
tell how well we're doing on the
projects and then you take out our team
and you end up with 2.5 like evida I
guess sure um I was trying to think of
the constraint all all week you know uh
zero Revenue retention got highlighted
in the in the thing but for us I think
it's going to be that I would we've kind
of captured the market we can capture
which for what we do is a driving radius
like we've I would say dominated Within
4 hours of where we're at which is like
you drive 4 hours to a house to evaluate
it and 4 hours back your day is gone um
so we're kind of at a push or pivot
moment of like do
we we do no advertising it's 95%
foreclosures and then like a few word of
mouth so do we pivot would you say
to the rest of Missouri like almost
franchise out like get four little like
find other big cities and and try to get
the rest of Missouri there's probably
like four quadrants or would you go go
into marketing cuz I know I mean doing
95% foreclosures it's like we don't
control our income of properties
whatsoever and we kind of have like that
that one funnel and like if we're clo
like if the economy gets good then you
have no deal flow kind of exactly and
constant through Co foreclosing was
literally illegal in Missouri and we
made 2.7 that year so somehow we made it
happen like you said it's just a lot
freaking harder but there's ways um so I
don't know if it's a push or a pivot I
would say that's our main con there's
things we can improve on but that's like
the one that keeps us up at night right
now let me just say what's the
goal we have a mission statement and
it's to uh make sure that all houses
within our reach are at their highest
and best value because we don't see a
house falling off the market as a good
thing that just makes other real estate
more expensive um I I know the goal is
not necessarily to ever sell so it would
probably be to expand I guess okay so
so you know path one is you just go to
another city and I wouldn't necessarily
call it franchising you just expand it's
just like opening another lighting thing
like that's you just that's just the
normal way of things like if you just
get better and better at it you open
another location um I see that as
another another set of skills for you
which I think will be valuable um and
you could and this time like if it's
basically there's no point I mean you
could go in Missouri but you could also
do any other Market that you'd want
because if you're if you're going past 4
hours of driving now you're in like
flying range in which case pick the
right City you know like pick whatever
City you want to go to um you'll also go
into a city that's going to probably
have competitors you know what I mean
which I see is a good thing um because
it means like the more competitors there
are the more of a market there is um as
long as you're you know number one then
more for you um and so that's that's
high I that's at least my perceptive
perception like whenever people like oh
there's a ton of competition in my
market I'm like that's awesome it means
there's tons of buyers
um and so just side note there but um
cuz the alternative of this is like
literally changing the entirety of your
business exactly which I I would I would
like you're doing well with it how long
you been doing this uh I've been doing
it for eight years yeah dude you've
already paid down like all the ignorance
Deb so like you're at this point you're
like you're like here on your curve like
you're like right here and so it's like
well don't don't jump back down to like
here again right don't go there um like
there's an ultimate version of this and
so what's the who's the biggest uh
wholesaler in the nation the biggest
Wholesale in the nation uh is it We Buy
Ugly Houses probably I mean there's a
lot of me okay so what do they do that
you don't
do um a lot of advertising a ton of
advertising pay pay for click uh mailers
is huge Billboards we do none of that so
I'll
bet that there's still way more deals
even probably even Within your current
market I think so and so I would
probably if I were you so either either
you have to replicate what you're
currently doing in a new market but you
have some of the risks that you've
already brought up which is like you're
all inbound based on foreclosures you
have some of these other things you're
not like the income is not necessarily
reliable um I would definitely learn the
advertising stuff for your own business
cuz like whenever there's an ultimate
version of the business that I'm
currently in it's like they already did
it and so now all I have to do is do it
better than them and whoever bu that
business is already gone probably and so
it's just a bunch of Suits who don't
know how this business works and so it's
just right for us to just murder them
I'm just being I'm just being super
honest like this is how I see it um and
so I think I would just like go 100% try
and pants them um and do PBC like and
like also do some of the stuff they're
probably not doing well they probably
aren't doing social well they probably
aren't running like not as well as they
could obviously their Billboards I know
the Billboards that they run um and but
I'll bet you they've got great sales
training and I'll bet you've got they've
got Great Floors of people and kind of
infrastructure in place and so I would
look at that I would look at their
overarching model as well because I'll
bet you they get a piece on the back end
as well like because they probably
vertically integrated as much as they
possibly could um within the business
that that they actually make more on
every deal than you do so they can spend
more on every deal like they can pay
more like so they have they have ways to
beat other people in all these different
markets cuz they're National right
exactly and so step one would be start
advertising more because then they'll
just immediately make more within your
current market like that would just that
might double your business if you just
did that um and then number two is I
would analyze the living hell out of
them like that's what I would do and
then think about like okay this is this
is the future version of my business one
can I replicate it two is there anything
I can do to make it better 100% I
definitely wouldn't change my business
for sure I think that I think your
advice is dead on it's just what I'm
afraid to do cuz I don't know how to do
it it's like I'll just go do in
different cities but I guess I got to
learn new things darn
right yeah maybe we can help um first of
all sorry my English is not my first
language try my what uh so I run a
software company called sub magic and
basically what we do is we have creators
make more captivating shortarm content
uh through
Ai and so the issue we are solving is
that everybody wants to create sh
content today thanks to people like you
um and they just struggle with creating
niceform content that Captivate the
attention of people and um so we decided
to create a tool that help us solve this
issue in three clicks for everybody so
we grew in the last 12 months from 0 to
5 million American Revenue we plan to
reach 20 million by year and
um we believe that in the world there is
two people that help us
drive all the traffic that we have it's
you and people like IMI because you are
most people who just push people to
create content you tell to tell to every
people like you should create content to
drive traffic to your business and so
they com to us and say I want to do the
same that
Alex and so we help them create the
captions the bws the zoom everything
into C and so today um in my goal to
reach 20 million in anual Revenue next
year um we identifi that there is a
something for a lot of our users that
comes from school uh so they have a
commune in school uh and they want to
drive members in their community so they
create content to drive members but they
are using some magic for create nice
content to drive traffic to school
community and so yeah my question was
like what should I do
with I mean in my mind like create a
partnership with people like you would
be the nicest and the most smart deal I
can do ever to my
business so yeah what's the
constraint what do you mean by the
constraint so you said you're going from
5 to 20 so why bought sorry so you said
you're at 5 million and you're going to
hit 20 next year yeah so how are you
getting customers right now that's weird
so how are you getting customers right
now we have four different channel uh
50% of our Revenue coming from World of
M all right uh then 20% from aat we have
7 aat today that share the world share
the message of the world and the rest is
mainly SEO in creation what's the price
uh so it's between 20 bucks a month to
150 bucks a month and our aage basket is
140 bucks a month 40 BS per user got it
got it what are margins uh we do 45% of
so you're still making money great
that's awesome super good okay um so I
so this is me looking out for you
why bother like why bother like let me
partner with Alex like why bother when
you could just go from 5 to 20 next year
anyways uh because we believe we can go
faster to this goal with people like you
and we can reach much more higher than
20 minut we think we can be become like
the all in one platform for short F
content creation from IDs to editing to
publishing your content and I think
there is a place to take in this world
where everybody's wants to be content
today and there is no software to do
that got it so walk me through the pro
this is just me understanding the
product so let's say so we've got this
right so let's just use this as a case
study so we record this say it's 60
Minutes um now what happens so I've got
this raw footage now what so now you
need to take the you need to take the
instruct and create some short from
content of this content right so if you
are basic in Edition you're going to see
an editor and ask him like Hey this is M
footage can you please take some moments
that are cool in the videos and doing
that it will take you like probably 40
bucks per short from content spends like
hours on it and you really don't get the
result that you like so otherwise you
use the software you put your footage
and selection exactly like which part
you can use it super easily you create
the caption on it in two clicks you
create the animation you need like after
effects and then you publish your
content it's it's just just makes sense
for every people want speak on
and so how does it identify where the
moments are and how to like structure
those moments this is me I just this is
me seeking for curiosity what do you
mean by moments moments so like we have
60 Minutes how does it know this is
interesting this is valuable and then
like there's a hook so I'm going to I'm
going to like he said the hook at the
end let's put that at the beginning
that's a very good question uh so
everything is based on TR strips so we
analyze what you say things to Ai and we
understand that you are talking about
giving business adice oh that's cool
okay who who talk about food and
everything is based on a and we
understand like we try to create sh
basic finding the B the answer and we
build that and then if it's not what
you're looking for you can just remove
it and change it to find the Bas and we
rate that out of 100 to see like which
shelf F should be the best part so
basically we do the work if need
to so it's like there's three Clips in
here this one will do the best based on
our guess this is the second best is the
third best exactly okay super
interesting yeah I mean I think it makes
sense that if you're if you're trying to
scale then like at this point I mean I'm
guessing that if you've grown to this
this level based on Word of Mouth and
Affiliates like you have growth channels
that are established and people are I'm
guessing happy with the product what's
churn churn is pretty high okay churn is
all weakness puns we have churn 15% a
month yeah so it's Prett high but it's
Lal because we target to M Market
everybody needs to create content this
room content and they just start and
then it's difficult to keep on going
everybody is not like like somebody and
sure difficult you know so they need
to yeah they still have to make it
before they like they still have to do
the 60 Minute recording which they don't
do right I'm just I'm I'm agreeing with
you yeah I think part of the of the
business we target like a massive Market
all over the world we people from other
60 countries we do that in 60 languages
so it's a mass
um CH is part of the game we just need
to understand who our ICB our ICB is
coaches people who use schools marketing
agency owner and those people are not
Shing because they have a Rel they make
money they make money is the business
that's why you can go chuny yeah
interesting also the thing is is other
markets there's like Network marketers
which is a massive space there's
Realtors which is a huge space there's
local business owners like there's a lot
of other yeah
Fitness coach all the people who are
good in selling something in video they
make great CH yeah really interesting um
I'm going to move on to the next person
but um yeah I mean fundamentally I think
you're I think you're doing the right
stuff like I don't like I always like to
see if I can reduce turn increase
activation like we're doing stuff like
that at school every day even though we
have phenomenal metrics we still want to
do better and sometimes like a handful
of tweaks even C and the funnel like
lots of things that gets into the
Tactical level but I think strategy wise
you're dead on to be honest with you I
mean it's a good Market you obviously
have a good product I mean if it's grown
to that point from Word of Mouth 50%
then like you have a good product um
you're growing more than your turn is so
and yes I agree with you that in a
consumer B like Spotify has high turn
Shopify has high turn when you're in the
consumer business which you are um so I
mean that that that that tracks and last
question what do you think about like
helping School users getting more
capting videos like just because you
teach them how to content
right um I think all of my content
teaches them how how to make content
more than school does yeah yeah I mean
you see what I mean uhhuh no I
understand yeah I mean I I I tell
everybody to use all the different
methods so it's like use Outreach like
go Reach Out DM do cold call cold email
cold whatever like door knock that's
oneon-one then you've got one to many
inbound which is content then you've got
making ads you've got Affiliates which
is what you use there's referrals like I
like people to use or at least
understand at least one or two different
ways of getting customers um but I think
you've got good stuff man very
interesting what's up Alex um so I'm
Joel I have a CPA firm uh based out of
Baker School California but during Co we
went virtual so now we serve all 50
states um I have a lot of constraints uh
but I think you know my questions would
be you know how do you prioritize what's
revenue revenue is last year was 2.5
this year's probably going to be about
three awesome uh margins last year
900,000 this year net was was probably
going to be about 1
one um awesome I don't know that's good
but I mean you're running 30% margins on
a on a I mean yeah expensive labor um so
I mean I guess my question is but it's a
super reliable business it's a valuable
business like accounting firms get
rolled up left and right there's tons of
buyer activity there like it's very
people don't turn out of their
accountants I mean it's like it's it's
very sticky there's High LTV the issue
with accounting is most of the times um
there's no one in there who knows how to
Market and sell that's usually the issue
with accounting accounting businesses
it's like all word of mouth and no one
knows how to like Market yeah and then
the other issue is is getting good
accountants because there's so much
Demand right for decent accountants and
so but like the accounting firms that I
know of like all have like anybody who
comes here with accounting firm almost
always makes money they're all doing
well um so there's there's big demand
yeah for sure so what's the issue um I
guess one would be
operations um just making sure our
clients are satisfied like we have a
short period of time to do all of our
work mostly during tax season right so
we get clients have certain expectations
get your tax returns down and we at
capacity but then you know obviously
they don't want to pay a premium
sometimes so I think we need to improve
our sales process to make sure that we
can charge premium to give them that
value that they're expecting so do you
mostly have one time a year customers or
no it's usually we charge quarterly okay
uh for quity tax planning uhhuh is it
more businesses or more individuals
businesses oh great okay well that's I
mean even better yeah so yeah our I mean
our minimum fee right now is 19950 a
quarter okay uh what's your annual stick
annual stick what do you mean by that uh
what's your Revenue turn annually it's
not as good as I liked it to be I
probably say we keep maybe 70% okay you
probably want yeah you want to get over
80 I mean for for accounting firms like
you probably can do a little better yeah
so I think it has to do with just also
making sure the clients see the value
because after we give them like certain
Tax Strategies they're kind of like oh I
kind of learned this now I can find a
cheaper accountant sometimes so even
though there is that stickiness you know
they especially some business owners
will be like oh well I kind of s the
value what you guys did last I I I'm not
sure I buy that I think what someone
says on the exit versus why they
actually cancel aren't necessarily the
same thing um cuz like I already got the
value is like literally what everyone
says when they want to leave anything
and it's just cuz like they just want to
leave um because I mean I what you want
is I mean fundamentally from an
accountant you want somebody who will
get you to pay as few tax as humanly
possible and keep you out of jail and
that's pretty much that's pretty much
the that's the task yeah and um make it
as little work for you as humanly
possible for that to occur right and so
I mean just me having been a consumer of
many different accounting firms and
accountants and employees who are you
know who did that stuff for us um I
don't I don't buy the like we taught
them the two or three tricks yeah um
also I bet you a bunch of your business
owners aren't even like close to it some
of them are bigger and like aren't
they're just like yeah just pay the bill
I don't I don't really care just make
sure it's right so I would bet that you
probably have bad
onboarding okay so basically the expect
the basically the Delta between what
they're sold and then what their
experience is in the first handful of
days and weeks going into it and then
the communication Cadence between touch
bases they probably see limited value
there and so I think um I would give you
the same kind of like if I were to like
buy 100% of your business tomorrow I
would audit the sales process to handoff
like I would bet you there's a massive
amount of opportunity there in terms of
like how can we take more notes on every
customer because the I get pissed off if
I feel like I'm talking to somebody they
don't know much about my business and
I'm paying them $8,000 you to rub my
taxes right immediately I'd be like oh
yeah [ __ ] you like I know you can't be
looking at like I can just do back of
napkin brain math of like if you barely
know who I am you definitely don't know
how to save me money on my taxes right I
we do have an onboarding process but
there might be a disconnect between the
sales well we already know there's a
disconnect cuz you said there
was so this is me this is me trying to
help so I would go really deep on the
onboarding process which is like how can
I really tighten this up both terms of
the personalization of the communication
and how can I speed up the number of
times you communicate with them because
you want frequent communication as long
as like it's pushed so it's not me
asking for [ __ ] you know because then I
[ __ ] hate you right like if you ask
me for St but if it's like hey uh just
letting you know we ran this today this
thing is moving forward everything's
good nothing for you just keep you in
the loop and then two days later hey we
also ran this thing um XYZ is done and
it's moving forward to the next step I'd
be like oh [ __ ] they're doing stuff and
so like I tell this to every but no one
does it and so this is me telling you
and hopefully you will do it but like if
you do a hundred things you want to let
them know every time you're doing one of
those things on their behalf and they're
like dude these guys are working for me
all the time like this guy works his ass
off and then someone else is like well
they're doing it for 8,000 I'll do it
for six and they're you're like oh no
these guys work their asses off for me
like I'm sure I'm safe like no one
actually knows it's kind of like when
the guy comes to your your house like
especially the nicer the neighborhood
you live in you know this like he's like
think I could do the like Li in for 10
grand I'm like dude you think I got this
house because I let people rip me off I
was like give me the r price and then
it's like all right I can do it for four
and you're like great you know or
whatever and so the thing is is like no
one really knows they just they just gut
call on the fact that like my
communication with this company has been
crappy the expectations are poor and so
if this is my external experience I'll
bet you they're not crossing their tees
and dotting their eyes on my taxes mhm
that would be my guess right and so I
think if you get all of the other stuff
tight they just guess that your internal
stuff's as tight which I hope it is um
and I'll bet you that'll keep the stick
honestly and of course accountants don't
know how to deal with customers so I bet
you probably need to train them again on
that communication Cadence so it's
basically way more personalized way more
frequent uh communication and then
probably very tight training on how to
have touchpoint calls with the customers
right or clients whatever for
sure that would be like the number one
thing I would do I wouldn't even do
anything else I mean do you think it's
scalable too cuz I mean my biggest yes
accounting firms are scalable ey KPMG
like yes they're scalable price yeah PWC
and what do you think those are publicly
trading accounting firms yes they're
scalable what do you think about like
one of the thing you mentioned I think
yes yesterday was like you
know the size of the brain the biggest
brain is as big as you know so I I'm
starting to now hire people that are
smarter than me in other areas like uh
but when it comes to accounting I'm
still like the smartest person in the
room yeah there's smarter accountants I
don't say there's a slight I just say
like look at the guys I keep like
they're some smart dudes yeah I mean I
kind of want to hire like cuz I'm more
of a CEO than I am a tax nerd yeah so I
rather hire like yeah go get a tax nerd
yeah yeah you go recruit somebody from
one of those companies who's like I need
somebody who worked at Enron who wasn't
a bad guy you know what I mean and
figure out like who can do like the real
the crazy stuff who knows the tax like
who reads tax law for fun yeah like
that's who you need cuz there are dudes
who do who are like oh curled up on I
like I know a buddy of mine who
literally goes to the pool with the tax
law his kids are in the pool and he's
reading it and I'm like what is wrong
with you he's like I just love this
stuff and I was like I'm glad someone
does you know like and he's like look at
this hole he's like oh I'm going to
crush this one and he's like he's like
this is legal he's like he just like
loves it's like for him is like treasure
hunting so like you need somebody who's
like that and if that's not you then you
should have somebody who is that way
yeah for sure so yes I agree and I think
you should do that okay I say step one
though fix all the outside stuff step
two go get that guy okay cuz that stuff
will make you more money today with what
you already have then do the other thing
right so newer SAS company we help
inbound sales teams improve their or
eliminate no shows improve their sales
often self-efficiency
um I really think the most helpful thing
for me would be just you running through
uh really the major learning lessons you
had from Allen in terms of red plag my
my background is high tiet education and
for state so I think I'm kind of coming
into it you know do you have a technical
co-founder I okay how good is he I spent
18 months fting so he's pretty good well
that could mean that it just took you
really long to find somebody who's bad
so
like um two years from now you're like I
should have know yeah um so it really
comes down to like has this person built
a sofware company before yeah Okay cool
so fundamentally like the entire game's
different than the high ticket game
right like it's all about Revenue
retention it's all about word of mouth
it's it's a product business there's
actually a podcast I just made I don't
even know when it's coming out about
this but like what business are you
really in and so like when I got into
Allen I thought I was in the marketing
and sales business because that was the
business that I came from but you're
actually in the product business so it
has to be it has to be basically like
taking to its natural extreme if people
don't stick with it it doesn't
matter so basically marketing and doing
everything else like it's a
right and so like unless that's right
nothing else matters basically and so
Marketing sales in the front end
literally only serves the purpose of
making the product better until there's
a point where it has what I would
consider passive growth where it grows
on its own and then you gas the living
hell out of it and then that's what
makes gazillion dollar companies like if
you want low turn you either have to go
up market and find the people who don't
turn out or you have to help create the
people who don't
turn so like the shop ifies and the
Spotify a lot of IFI here um there's
going to be there's cohort CH which
you're probably familiar with if you're
co-founders in this so like you're going
to have periods of time where it's like
okay the first six months we turn out
[ __ ] 80% of our customers but the 20%
after that point our retention curve is
flat and so you just have to figure out
once you get to that data cohort you're
like okay what do these people look like
and then you readjust the messaging
readjust uh the marketing so you can get
more and more of those people so you get
a bigger bigger slice of them and funly
that Loop is what will you more or less
focus on um and then I think about it
from when I'm trying to reverse engineer
the customer Avatar it's like you have
psychographics like what do they believe
you have demographics what do they look
like where are they from you have
Geographics are where where are they um
and then you have kind of activities
which is like what did they do so if I'm
trying to reverse engineer what the
people who spend the most money with me
look like I look through those those
lenses who are they where are they from
what do they believe what do they do
and then I try and say in my ads hey I'm
looking for people who believe these
things I look in the places that they're
at um and then once they're in I try and
get them to do the same things that the
people who were successful who look like
them who talk like them who believe like
them did in order to be successful so
like in the beginning you just do a ton
of marketing to get Traction in the door
and that's literally just so you can
like see if people like it see where
they're turning out see get basically
you just want feedback and then once you
find what people are liking what they're
successful with obviously iterate from a
product perspective on the road map to
do more of the stuff that core in terms
of value but then the marketing side it
Loops back and then that's what informs
who you're picking on the front end who
you're marketing to right so you're
being much more specific on and to only
call the people that s yes yes and the
hard part is that your sales team won't
want to do it and you will not want to
say no to money yeah but I I understand
a comp pers for the
next cool but that's I mean like if you
look at Vista um I I became friendly
acquaintances with their their head of
pricing and packaging and he was just
like if you do you know who vist is so
they're out of aost in hundred billion
dollar private Equity they're they'd be
like the fifth biggest company like
whatever they're massive um and they
only their private Equity they and they
buy software companies and they triple
them in in in three years which is their
goal and they flip them and so um the
founder I can't remember his name now I
feel bad um is uh any anyways Rich did
I'll just put that way um point being I
was talking to the head of packaging and
he said you want to know our whole
secret and I was like what man he's like
we just know our our acquired
companies's customers better than they
do I was like what do you mean he's like
so we go into the data room and we look
at all the customers they have and we
look at what channels they came from we
look at who they are how they act all
that stuff he's like then we turn off
all the marketing that's not those
customers and we crank the living hell
out of the stuff that is that and we do
nothing else and the company
triples obviously it's more than that
but fundamentally like big picture
strategy that's what they do we get more
of the people who spend the most
money but people just aren't disciplined
and that's why people just stay poor
because then they they try and serve too
many people too many different avatars
they can't say no to money today so they
don't get the big money
tomorrow cool appreciate than you hi I'm
AR Alex uh DTC fion brand Commerce
Indonesia from Indonesia doing $1
million a year IIT that $3 million been
doing this n years
awesome uh thanks for making it out
thank you how do I know when to expand
new product
line what are you selling now what do
you sell now t-shirt shirt pants Jeans
jacket but mostly man is it what is it
white label or a brand say it again is
it your brand or is it my your brand I
manufactur it I I'm not manufactur I con
to the other Factory in Indonesia and
then I only own the office and the
warehouse is it custom do you design it
or you just slap your leg you design it
knock off no that's fine I mean like hey
I'm I'm I'm not I don't dud
competition's competition um as long as
you're not hacking their databases or
anything like that's I mean that's the
nature of the retail business I
understand it um okay
so the question that you have is how do
how do you scale it or basically how do
you add more to expand new product line
let's say Woman's let's say sports well
because I'm doing casual only let's say
formal um I don't think at 10 million
you need to like like you can do so much
more even within that within that that
demographic like if you're just mostly
men's wear like there's tons of massive
Men's Wear companies can I add to that
yeah add yeah I'm thinking about that
also because I haven't achieved 200 or
$300 million yet but isn't it isn't it
will make my brand to men were l in life
so I'm not building enough Foundation to
capture the woman's
letter in$ 300 $500
million 500 million a month that would
be a lot
um it's a tough call man I'll be honest
with you because like on one level I
mean if you're like I want to build the
next Nike then yeah you're going to have
to sell to everybody but even Nike
doesn't sell
suits right just like like there's so
like there's so many people who buy so
much clothing um and I mean I think so
right now I think you're a little bit of
of like a brand identity spot like you
obviously know how to convert I'm
guessing are you running ads yeah right
so you know like you know you know that
game and you run really good margins I'm
sure on the on the products based on and
and you can you know how to run run ads
at scale and
so what I think right now is you have to
figure out who who you want to become as
a brand so if you like men's wear then
like you can be I think you can build a
massive men's Weare company just being I
mean just being really transparent with
you like you can um build a massive
menare company also like lemon doesn't
do I guess they have like pants that are
nice but like they're all sportsare so
like I mean l is a terrible example now
because they're just gone to crap but
like um like if you look at these I like
like I just as a framework for everybody
like I look at what's the biggest
version of the business that's currently
here like what did they do to get there
what does their business model look like
like and then how many steps between
where I'm at and where they are do I
need to take and like what lessons or
what what skills am I deficient in and
then it's like okay well then those
skill deficiencies become the
opportunity like fundamentally that's it
and what their brand looks like and how
they monetize like are they vertically
integrated or like if I was getting into
the into the energy drink business I'd
be like okay well Red Bull has
outsourced literally everything besides
marketing so I guess that might be the
most important thing for a consumer
packaged good that's you know rtds ready
to drink and distribution so it's like
they have massive brand plays massive
distribution you know they have their
recipe underlock and key and everything
else is is so like basically I would
look at the brand like is there a brand
that you want to emulate uh basically
I'm I'm what problem are with uh am I
solving is just a billion dollar exit
building consulting firm and then that
is a LD magnet to PE built media and
then control the Indonesia okay so my
goal is just I'll a billion liquid cast
okay well let's take so right now we
sell clothes so let's a couple I get it
I appreciate that so I want to I want to
increase the like that you get there so
I think like you can make this thing
very valuable without doing all of the
other stuff that you were talking about
so I think like you absolutely can do
this and then think okay why can't I get
this to $100 million a year selling
men's Weare like why can't I and I think
that way then it's like okay is there a
is there a brand person who can endorse
this like if look at the biggest retail
Brands they have big
endorsers who stand next to the product
that increases conversion increases the
premium you can charge and so instead of
knocking off Zara you just become a
brand and I think honestly I think
that's the gap for you like you're
obviously very good at the Arbitrage of
media to to clicks and whatnot but like
I think you need to go from that to
building a brand and then that's what
will make it sellable so this is what I
like that's the tldr of our conversation
is that's what makes your thing valuable
is you need to build a brand
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