I Built 4 Businesses In A Row To Show It's Not Luck

Summary

The speaker shares insights from launching four successful businesses, emphasizing the importance of exceptional products and leveraging client finance acquisition to eliminate capital constraints. They recount overcoming challenges like COVID-19 and poor hiring decisions, highlighting the power of timing and strategic marketing. The narrative covers innovative approaches in various industries, including gym licensing, supplement sales, appointment scheduling, and a portfolio company accelerator, all aimed at scaling businesses beyond traditional limits.

Takeaways

• 🚀 The speaker emphasizes the importance of learning from mistakes and sharing frameworks and lessons to help others scale their businesses.
• 💰 The first business, Gym Launch, was a licensing model for gym owners which peaked at a valuation of 150 million dollars before being sold for 46.2 million due to COVID-19 impact.
• 📈 The speaker highlights the power of exceptional products that customers love, as they can create a significant word-of-mouth effect and long-term benefits.
• 🔄 The concept of 'Client Finance Acquisition' is introduced as a strategy where the revenue from the first sale is used to acquire the next customer, eliminating capital as a constraint.
• 📊 The speaker discusses the importance of identifying and solving specific problems faced by customers, using data and community insights to inform hypotheses and strategies.
• 📉 The challenges faced during business growth include the COVID-19 pandemic's impact on the gym industry and over-hiring for customer support, leading to layoffs.
• 💡 Timing and leveraging arbitrage opportunities in marketing, such as early adoption of Facebook ads, contributed to the success of Gym Launch.
• 🏆 The speaker's approach to business involves aggressive customer acquisition and a focus on high-margin products, like the supplements sold through Prestige Labs.
• 🤖 The business Allen.com utilized AI and machine learning to optimize lead conversion for small businesses, particularly in the fitness industry, by improving scheduling processes.
• 🔑 Key lessons from the speaker's experiences include the necessity of having an in-house CTO for software businesses, the importance of pricing strategy, and aligning incentives with customers.
• 💼 Acquisition.com represents a shift to a business model based on personal branding and inbound strategies, focusing on learning and growth through exposure to diverse industries.

Q & A

What was the business model of Gym Launch?

Gym Launch was a licensing business for gym owners. It provided a model to gym owners, which they could use to increase their profits, with the average gym making an extra hundred thousand dollars a year in profit.

How did the speaker initially acquire customers for Gym Launch?

Initially, the speaker used a VA in the Philippines to scrape Crossfit's database and send emails. After a webinar with no viewers, the speaker manually looked up the emails of leads, friended them on Facebook, and messaged them to eventually convert a few into customers.

What was the peak valuation of Gym Launch before it was sold?

The business was worth about 150 million dollars at its peak before it was sold for 46.2 million to American Pacific Group.

How did Gym Launch scale its business model?

Gym Launch scaled by selling a licensing model with virtually 100% margins, which allowed for rapid growth as they just needed to sell more units to increase sales.

What is the concept of Client Finance Acquisition mentioned in the script?

Client Finance Acquisition is a model where customers finance the acquisition of the next customer. If the first sale covers the cost of acquiring and fulfilling that customer, plus the cost of acquiring and fulfilling the next customer, it eliminates capital as a constraint in the business.

What was the initial challenge Gym Launch faced with Facebook ads?

The initial challenge was that no one watched the webinar they created. However, they managed to get 80 leads from people who opted in, although none of them bought or scheduled a call initially.

How did the speaker's second company, Prestige Labs, leverage the success of Gym Launch?

Prestige Labs was built as a sister company to Gym Launch, using the affiliate base acquired through Gym Launch. It focused on selling supplements specifically to gym owners, leveraging the marketing and sales knowledge gained from Gym Launch.

What was the main reason for the success of Gym Launch according to the speaker?

The main reason for Gym Launch's success was timing. They identified arbitrage on Facebook ads before anyone else and created a turnkey system around how to monetize it, which led to a high return on marketing.

What was the speaker's approach to customer acquisition that differed from the traditional model?

The speaker used a different approach called Client Finance Acquisition, where the cost of acquiring a customer was covered by the profit from the first sale, eliminating the need for a loss leader strategy.

What was the speaker's biggest lesson from Prestige Labs?

The biggest lesson was that the speaker probably shouldn't have started Prestige Labs, as allocating more time to improving Gym Launch could have led to even greater success.

What was the business model of Allen, the speaker's third company?

Allen was a software company that focused on aggregating data from small businesses to predictably show the best times for scheduling appointments, with the goal of increasing the number of people who showed up for appointments.

What was the speaker's strategy for scaling Allen's business?

The strategy involved initially targeting the distribution base of gym owners, then shifting to selling to agencies, which allowed for greater leverage as one agency could represent multiple small business owners.

What was the speaker's biggest takeaway from the experience with Allen's software development?

The biggest takeaway was the importance of having an in-house CTO if you're going to build a software company, as relying on external development shops can be limiting and not as effective.

What is Acquisition.com, and how does it differ from the speaker's previous businesses?

Acquisition.com is a portfolio of companies that does over 200 million dollars a year. It differs from the speaker's previous businesses as it is built on a personal brand and inbound content, focusing on learning and growth through exposure to a variety of businesses.

What is the speaker's approach to hiring for his businesses?

The speaker hires from the top down, starting with key roles like director of sales, marketing, people, IT, and portfolio operations. This approach allows for delegation to people who are better at their respective roles, accelerating the business growth.

What is the speaker's perspective on the importance of learning in business?

The speaker believes that the purpose of life is to learn, and by exposing himself to a variety of businesses and experiences, he can maximize his learning and cross-pollinate ideas across industries for outsized returns.

What is the speaker's view on the role of talent in business success?

The speaker considers recruiting talent as the single core competency of the business. He emphasizes the importance of having the right people in key roles and leveraging the prestige of a private equity firm to attract top talent.