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Video transcript:
Here are seven counterintuitive strategies that might sound wrong, but are actually right for an early stage business to grow. So let's dive straight into it. Number one, spending money is more important than saving money.
You've got to get good at spending money, not saving money. Now, when you're a small business, you don't have much money, so there's not a lot to save. If you're a big business with millions and millions of revenue, if you can save money, then that widens your margin and you're more profitable.
So that's a great idea. But if you're a small business that wants to scale up, you have to spend money effectively. You've got to get good at boosting posts with ads.
You've got to get good at hiring contractors who can add some value to your business. You've got to get great at spending money on ways to promote and do marketing for your business. You've got to create some ways to spend money on good quality content.
So there's all sorts of ways that you can spend money. And the hard thing here is not saving money. The hard thing is finding smart ways to spend money, but that's what you've got to do.
So every single time I've scaled my companies, it's because I got good at spending money. First time I scaled my solar company to a million, I got really good at running Google ads, and I got good at collecting those leads and turning them into sales. In another construction business I own, I got really good at Facebook ads.
And in my third business, I got really good at scaling my team and hiring the right people and bringing them on board. So what you have to get good at is finding the way that you spend money to make money. Idea number two is that revenue is more important than profit.
Now everyone says the old saying, revenue is vanity, profit is sanity, and cash flow is king. I get it. I've heard it 100 times myself.
But the truth is that it doesn't matter if you're highly profitable if you're doing 50 grand a year of revenue. Let's say you've got a 50% profit margin on 50,000 worth of revenue. You'd still be better off working at Starbucks.
What you have to do is get those revenues up. You've got to get those numbers up into the millions. What normally has to happen is you've got to get revenue high enough that you can afford a great little core team to promote your business.
And then once you've done that, you can then focus about widening those margins. It's often the case that most businesses have fixed overheads that just have to happen. And then you've got your gross margins.
And the gross margins really don't kick in until you've got high enough revenue to cover the fixed overheads. So you have to get the revenue up. You obviously can't run out of cash.
That's the rule of the game. But you must as quick as possible get your revenues up, even if it means that it's not wildly profitable. Idea number three is improving cash in the bank is better than keeping really accurate records.
You see, when you're growing fast in those first few years, the number one number that matters is what's the cash at bank. So what you're looking for is to make sure that the cash in your bank account is at least stable or hopefully growing. But in reality, and unfortunately, that's one of the only numbers that you're going to have access to that's live, that's real, that gives you real peace of mind or a good sleep at night factor.
So that cash at bank number, that's the main one, because you can't run out of cash. You must make sure that your business always has enough cash to stay in business. And you've got to keep an eye on that number.
The problem is with fast growth in small businesses, a lot of the other numbers, by the time you get the numbers, they're outdated. By the time you get the actual numbers, your business has moved on. There's not a lot you can do with those numbers.
It's time consuming to get those numbers in a small business in many cases. So a lot of the time I see people trying to analyze these tiny little numbers that don't make much of a difference. They're not really projecting much forward looking stuff.
They waste their time on that stuff. And ultimately their business stalls, as opposed to what I've done when I've scaled my businesses is I've kept my eyes on cash at bank so that I know that I'm safe. But then I just focus on getting more money in the door, right? So to win in business, get those payments in, make sure the cash at bank goes up.
And that's the main number I'm always looking at. Moving on to number four, band-aid solutions are better than well thought out systems. Isn't that a silly idea? Of course you should have really great standard operating procedures and you should have a system for everything.
And you should outsource to the systems and you should have a Dropbox folder full of amazing systems and everyone should follow the systems. Well, not really, not at first and not in the beginning. When you've got a fast growth business, a lot of the time a band-aid solution is better than a well thought through solution.
What do I mean by that? A band-aid is something that's cheap and fast and it works and it stops the bleeding and then you can move on. Now, when is it time to systemize? It's time to systemize when the business is starting to establish best practices. In the early days, you want to actually remain pretty flexible in the way that you do things.
You're trying to figure out what are the best practices. You're trying to find out a new and unique approach to getting things done in a faster, better, cheaper way. So if you're too rigid with your systems, you're not going to discover those better, faster, cheaper ways.
With band-aid solutions, you're focusing on moving forward as fast as you can. Let me give you an example of a band-aid solution versus a well thought out system. In one of my first businesses, we were told I should have a very detailed CRM system and that I should systemize my CRM system.
And what I ended up doing was, I ended up with a cardboard box for a box for appointments, a box for presentations, and a box for sales. And what I did was, whenever I had a lead, I stuck it in that box. And then when I made an appointment, I literally put it into the next box and then the next box and the next box.
And then down in that last box was all of our filled in sales forms that I had written by hand. And I know that sounds absolutely ridiculous, literally business cards and handwritten notes going on one end and sales that were written on a piece of paper down the other end. But that got me through my first seven figures of revenue.
But that was our CRM system. And we got to seven figures of revenue in the same period of time that most people are still trying to figure out how to set up their CRM system. Now, luckily, those days have changed.
In today's age, there are great CRM systems available that are easy to get started. My suggestion here is to check out a piece of software called High Level, which is what I use in my business and with all of my clients. Now, this video is not sponsored, but you can visit the first link down in the description below, which is going to allow you to sign up for an extended free trial and get all my business training for free, as well as a completely free strategy session with the High Level team, where they'll walk you through exactly how to use and set up the software.
So it's perfectly customized to you and your business needs. Now let's get back to the video. Okay, so the next one is that a brochure is more important than a website.
And what do I mean by that? Well, in the early days of business, people are not going to be searching for your business. They're not going to be going to try and find you online because there's not enough people who even know you exist. What you need to do is to go and reach out to people, be outbound.
And in many cases, sending out a PDF brochure of what it is that you're doing that really talks about your product. Send out a beautiful brochure. In many cases, that's going to be more effective than a website.
You're going to reach out to people with an email attachment and say, hey, I'm launching this product or service. I'd love some feedback. And you're probably going to get more engagement that way.
Also, you might be meeting people face to face in the physical environment, sitting down with them and having a one-to-one sales conversation. You don't want to pull out a computer and distract them. You want to take out a brochure and be able to flip through the pages.
Now I get it. Everything happens online these days. You can have a digital brochure.
You could have a slide deck. But what I'm saying is rather than spending 15 or 20 grand developing a fancy website, I'd rather have you focus on outbound sales and putting something that really is about your product and your service in front of people so they can evaluate your offer and you can actually talk them through it and hopefully make some sales. Number six on our list is that the only brand that really matters is your personal brand, not so much your business brand or your product brand.
It's the way people think is that they fall in love with personal brands. They love names and faces and people and they want to get to know you personally. They're going to trust your business if they trust you.
And they're not going to trust your business if they don't trust you. If you try and be invisible and sit behind a business brand or a product brand too soon, no one's going to get to know you like you and trust you. And no one's going to want to do business with you.
So you flip that and say forget about the business brand and the product brand for now. It's me personally. It's my name on this product and it's going to be me who you get to know, like and trust in the early days.
I'm not saying that that's the way to scale up, but it's certainly the way to get those first sales through the door. People get to know your face, your name, your brand, your reputation, and that's why they buy from your business. Number seven, passive income and automation are the things that are going to send you broke in the early days.
Obviously as you're scaling up, you want to automate things and you want to build some digital assets that perform whether you're there or not. But in the early days, the idea that you're going to be able to make a passive business that runs without you, that operates on autopilot, it's way too soon to be thinking about that. In fact, the people who are the best at automation, the people who are the best at creating assets, are the people who get their hands dirty in the early days.
Every great entrepreneur that I know who's built a multi-hundred million dollar business or even a billion dollar business, they're not at all afraid to get their hands dirty. They go out and talk to customers. They get face-to-face with customers.
They get hands-on to their systems. They do handwritten things if that's what's required. They do things that don't scale before they do things that do scale.
So what I want you to do is ignore the idea of passive income and automation in the early days. Focus on doing the difficult things that don't scale first and then figure out how to make a scalable version of that. So I hope you've enjoyed these counterintuitive ideas.
These are the ideas that are right for small startups that are getting off the ground. If you're in your first seven figures of revenue, it's often the case that you will hear a mentor who's got 10 million of revenue sharing what's working for them and it's different when you're at the beginning of the journey. So which idea did you like the best? What was the idea that stood out the most? Let me know in the comments below.
Thanks for watching and maybe I will see you in one of the next videos that should show up right about now.