"He Makes $1.5M a Year... and Keeps 1.3% of It" | Alex Hormozi Answers Live

What did you get it? >> I have No, but I have the three right there. >> Um, but what was interesting is that the difference between $29 for all three books and $12 for all three books was a 4x difference in conversions. 4x. And so there are these these lines where you're like at 48 hours it feels reasonable. So it's like where's the line where it feels unreasonable? And at that unreasonable line, right as you tease into it, is where you'll start, you'll see this kind of change in demand that will happen. And then we just do math. It's kind of like having an unconditional guarantee, knowing that you're going to have 10 or 20% more people buy and more refunds, but you'll still net more. Right? Now, it's not one to one in terms of the example, but hopefully the analogy makes sense, which is like if we if we say we're willing to give 20% back, right? um if we don't get it you know done in 24 hours then we might get five times the demand. >> Okay. >> And so I would experiment with one number one is difference in creative like I would use a lot of statics if you haven't done that because that might be an easy easier one for you. Um but two the biggest one especially local is offer driven. >> So it's like a 24-hour promise. It's like from the time you basically give us like you pay us like the stuff will be out of your house in 24 hours. >> That's the idea. Um like how can we just like speed is going to be the biggest thing you have. Um obviously have a little bit of risk with the guys uh not being you know excons and stealing stuff or you know destroying the house or whatever. Again I don't actually think that but you know consumer perception. Um those should probably be where I would focus on as my point of greatest leverage. >> Okay cool. >> Appreciate you. Yeah you bet. Ryan, what's up? >> Alex, thanks so much for having me on. Really appreciate your time. I've been watching your content for about seven months now. It's changed my life. So, I just wanted to thank you for that. Everything you've done, um, give me more time to spend with my family, my daughter. So, uh, about myself though, I run a multi-state online psychiatry practice for about seven years. Uh, we provide medication management. and I have seven providers about 1.5 million in revenue looking to get to 5 million in the next 12 months. Uh I've got three constraints stacked and I can't tell which one to break first. >> Okay. >> So my first constraint is demand. That's the most immediate one comes all of my uh revenue about 85% of it comes from a single channel. I've been doing the same thing for seven years essentially. I've maxed out on what I can do on that channel. I'm got uh seven providers billing about 20 to 25 hours per week which they're committed to but I'm running into constraints where I don't have uh enough billable hours where all their availability isn't getting full. Yeah. >> My second constraint is margin. So I pay my nurse practitioners 50% of what they collect. So that lands the NP right around market salary. >> Can't go any lower on the split without losing them. If I move to hourly or salary, that puts me into cash flow constraints. So that's risky. >> Okay. >> One 1.3% is my net margin. >> So my problem is if I scale from seven to 20, I grow revenue, but I don't necessarily grow profit. And then my third constraint is onboarding. So we take insurance about uh 89% comes from insurance, 11% from cash. Uh I've about hit the ceiling as far as the credentiing goes. fast as we can do the onboarding. So that kind of caps a little bit how fast it can add people because it takes about three to four months. So my question to you is what would you address first and why? >> So it's a holistic issue. So instead of saying like there's three constraints, >> I think the issue is fundamentally you have a model that has a channel the insurance companies right who define your pricing. >> Yes. And so if you're in the insurance business, it's kind of like a regulated industry. It's like functionally, right? It's like you have a price cap. >> And so the only way to win in those industries is that you have to you have to eat it from the bottom, which means it's all cost driven. So it's like unfortunately you have to think about your business like Walmart, which is like we actually have to save every single penny because demand shouldn't be an issue for the business because you should have enough insurance clients that you always are filled up. Like this is a very classic problem for insurance-based healthcare >> is that they have revenue, they have almost no margin, and that's because insurance prices at the point of a normal operator barely making enough. Like that's that's where they price. They continue to lower it until people go out of business and then they they don't have enough. So they have to like price you right where right where they you know right where they know that you're going to barely stay alive. And so uh you basically have two you have you have one choice to make and then there's downstream from that which is if you want to stay insurance you become you become a pure operator it's all about driving down costs everywhere and the biggest lever you have is you have NPs right is there any other person or way that we like like the novelty of the model right now the problem with the model is that you're giving 50% of all your revenue to to to labor which is really tough >> um and So we'd we'd want that cost to be closer to like 20% of the cost of insurance. And so it's like is there a way that we can move people through faster so we can get more, you know, more out of each either NP or is there another person who is not an NP that can still do the job. Um that's on the cost driven side. The other side is you just turn into a normal business which is just cash and then you just learn and then you can sell whatever you want, right? And they have you have no rules. Um, which one of those feels more like aligned with your skill set? >> I would say both. >> Well, we got to pick one. [laughter] >> Well, if I were to pick Well, if I were to pick one, I would say uh we've already maxed out efficiency to talk out loud. I've got a I built my own software program. We've got 99% collection rates from insurance. Very low stuff sitting out there. Two months sitting out in AR. So, I I feel like I've maximized a lot of the efficiency. I have very low staffing costs. I've outsourced that. So, it's got to be going to a cash pay based rate because we know insurance rates are going up. And so, it would have >> You mean going down? >> Well, the cost of of of getting I mean for the patients is going up. The insurance rates are going up about 11 to 13% a year. So, >> are you getting paid more 11 to 13% a year? >> Pients are paying more in premiums and their benefits are going down, which means they have to pay more out of pocket, meaning their costs are less predictable. So give people a I I was thinking go to a a subscription based cashbased uh where people have predictability and start cutting out the insurance a hybrid approach where people can use their insurance but then do subscription based. >> Yeah. >> The the the bridge from where you're at to cash um is less risky than you think it is. Um so the way that you would the way that I would do this is that you're going to have this flow of insurance customers right >> in the sales process. I would ask one sorting question up front which is are you here for the best thing or are you here for just what insurance covers? And just by asking that question you will unlock the people who are willing to spend more to get the thing they need. And then that basically opens the door to selling cash services and say look listen we'll bill your insurance to everything that it can cover but this would be the excess. And then just making that one change in your business you've got you know one and a half% margins. Like if we add 10 or 20% to the business, it would 10x your your profit. >> Absolutely. What I'm seeing is there needs to be something we offer that other people don't that they see the value inherently, right, for for this. And so what I really see is I see the problems every day. You know, I've been doing this for about 15 years now. So I know I know what the problems are. And a lot of it is is people just aren't don't feel fulfilled. They go into psychiatry, they hit a plateau, they get the medications, and then they kind of level off, right? And so I'm thinking, how can I integrate uh AI into this? And that's what I've been building out as a solution to this where we can integrate what they're doing with the therapist with what they're doing with us. Have them hit one or two outcomes every time they meet with us. Add in more or less a coaching component to this where the healthcare provider is kind of meeting the needs where they go to the therapist and they go to us for the medications and then we have a coaching component. That coaching component is in fact the app where we can now solve that communication problem between the medical provider, the therapist because right now it's very siloed in healthcare. They go to the therapist, they go to us for medication management and that's kind of across the board is if we could solve that problem. So that's what I've been spending a lot of my time and energy on is is putting that into something that the patient will be able to to use. So imagine they see us, they pick one or two outcomes. What is it that what is your what do you want essentially? How can we best help you? What does that look like? They see the therapist. The therapist gets to see what their outcomes are. And essentially, we can bridge between the therapist and us, which then pulls the therapist in to refer more patients. And then we can essentially cross refer between online therapy practices and us. If we can get more >> I'm not sure what the AI thing does. >> What's Well, I would look at it really simply as the patient has an outcome. They don't know what they want. They're focused on symptoms. these are my problems. But what they really want is they want to, you know, have a better life. They want to feel fulfilled. They want, you know, there's things that people want, right? But they're so focused on just overcoming these symptoms. >> What does the AI do? >> I would see it as helping them uh they quite simply they see us and we the provider logs their outcomes of what they want and then here are one or two easy things that you're going to do for 10 or 15 minutes a day to get there. >> What does the AI do? It solves the communication barrier. >> Let me say it differently. Does do they chat with it? Do they text it? Do like what is it like what do they how are they interacting with this thing? >> How do they interface? Yeah, >> exactly. Okay, got it. >> So, it's the uh the provider that interfaces with it and puts the information and the patient just gets the information as a care plan which then goes to the therapist. So, it's basically a streamline form of communication. >> So, it sounds like you just want to make AI plans and then sell them care plans on top of their medication stuff. >> I would add in other value added things like videos and things that are proven strategies that are really going to help people be on medications to help them get better as part of a subscription so they get that information after the visit as a care plan information tailored to them. >> What's the subscription like? Why is it consumable? Because I'm going to get a plan, right? >> Yeah. >> So why do I need to get another plan? >> Well, because most of the time when people see a provider, they're just talking about what they're going to do. They're talking about It's very clinically based, but it doesn't really get at the root cause. It doesn't get at the outcome. It's not outcome based. Healthcare is outcome >> based. I get that. But I go I'm going to I'm going to say the customer journey. I go to a therapist. >> Yeah. >> Therapist says, "You need drugs. >> I go to you and then you say, "Here's how we balance these drugs." >> Yes. >> And then you get paid for insurance to do that. And then I go back to my therapist to keep doing my therapy. Wouldn't the therapist feel like you're interact you're interfering with their plan that they have for the the the patient? >> Uh no, because the therapist often times will be the one that tells the patient about 80% of the time that they need medications anyway. So the therapist is mostly on board because most of our patients that come to us are already seeing a therapist and the therapist wanted them to come to us for medication management. So when we provide supportive therapy to them, we're integrating in with what they're already doing in therapy. So they're not siloed. Why do they have to be separate? That's >> No, I I I I understand what the problem that you're trying to solve. Um >> Okay. Okay. >> It I I'm It's not It doesn't have It's like It doesn't have a lot of teeth, right? I'm like I think that if you like basically if you just said, "Hey, you need more help than your therapist. Here's a very lowcost version of this which is we'll send you a video every day which will give you a practice that you can do in addition to the medications and it'll decrease and it's towards these specific outcomes and the AI is just sending the videos. >> I don't think you're going to get like how many patients a week are you are you bringing on? >> Uh we're bringing on well let's see 125 new patients uh a month. So divide by four essentially that's what we're we're getting and then um per month we're getting around total patients around 500. Five to 600. >> What was the new patient again? >> One one >> about 155. I spent about 6,000 on ads a month. >> Okay. So 155 new patients a month. >> Um >> Yeah. >> What you're going to want to do cuz you're one and a half million a month. So it's like what 120ish a month somewhere in there? >> Yeah. Yeah. >> Yeah. So 120ish. So, it's like if we can get an extra, you know, for every every every $100 we get from there gives you another 10% increase in revenue. >> Mhm. >> Um, [clears throat] honestly, I would rather instead of selling a subscription, I think you'll have a better bet just selling to the goal. >> Okay. and just saying, I mean, you could test it, but like my bet would be something in the I would probably around $500 or $600 is what I would want as my price point because that's a that's an impulse purchase for consumers. Um, typically in that in that range. >> Um, call it three to 600. Uh, and so I would I would say like you're you know your your plan's going to take 16 weeks. We'll we'll basically sell you this automated personalized plan >> uh which is $300 or $600. If we can do that, you could probably I mean every 10% for you is like a 7x in profit. So like if we could So I just want to keep this simple because the way you explain it I think would drive anyone insane. Uh and way too much. [laughter] Uh it's just it's two things that you do. Number one, sorting question. Are you here for the best outcome or just what insurance covers? If they say best outcome, then you say cool. Most people don't want to be on medication forever. And so what we're going to do is try and help you. Like you're not here to take medication. You're here to get an outcome. Right. Right. Okay. Cool. And so we found and there's tons of research to support this is that these practices support these outcomes. And so it's a onetime thing we plan it and if you can track this would be helpful for you. The people who buy our plan versus the people who don't have slightly better outcomes or they decrease their medicine. Whatever thing that you can track um would then make that like then what ends up happening is that the the value exchange becomes I'm going to pay $500 to take 20% less medications in six months from now. >> Okay. And I think that's and as soon as you could just make that equivalency um within compliance and all that uh that would be the pinch. And so I think if you could just do that that probably will help. >> So would you offer two two tracks for people? People who want more interaction that want to use their insurance still and will apply the visits towards their insurance and then the second one is people who want less visits but more information and kind of to strike a balance between consumer mindsets. I want to max out insurance and then I want to have something that's on top of that. >> Okay. So, but do we want to increase the number of people percentages that are cash pay because they're only 11% right now? >> It's less about like increasing the percentage of cash pay and just saying like you come in, you've got insurance. Insurance covers you for $100. I'm making it up. 100 bucks. Uh my thing is $200. The first hundred is going to go towards we're going to do the insurance deliverable and then we're also going to add this on top. >> Got it. And you think I'm constrained as far as the what I pay the providers because I know the market rate and the the split I don't and I did the math I could do it in a tiered fashion but then when I do when I looked at the gains given my operating expenses it didn't really make sense to do it that way. I was constrained at it 50% I think. >> Well I mean you have a cost- driven business because you have insurance which means you cannot control price which means you can only control cost and you're saying you can't go go above 50%. And so the only way that you can do that is that we either get way more out of them or we find a way for them to do it cheaper. Like that's it. >> Okay. >> Like I'm taking what you're saying at face value that like there's no way. I think that's false. So I would just stop saying that because it's not true. Like you're running 1% margins. There's no way that like because I've seen other businesses that are insurance, you know, in the space and they don't run 1% margin. So like >> yes, >> you for sure can save more money than you currently are. But in terms of ease of getting into a world where you don't have to purely be subject to the regulations and the pricing of insurance companies sorting question and then one plan that you can sell to those people that's on top that's low operational drag. >> Got it. >> Thank you. That's very helpful. Appreciate your time. >> Thanks R. Appreciate you. >> Lame. >> What's up? Are is lame. Is that the way to say is lamine? Did I say it right? >> Lamin. Lam. I mean, all right, talk to me. >> All right, so yeah, I'm a growth operator for a brand selling leadership and self-development to men. We're on track to 500K this year. We want to target 1 to 2 million in 2027. >> So, we have two products. One is a $2,000 per year online community on school and we have four in four inerson retreats a year. So, we sell them separately or as a package with online community at $3,500. >> Okay. >> We sell off bi-weekly webinars, 41% close rate. So I think the acquisition is not an issue. The problem is that we're unable to make money off current customers. So we always keep on having new customers every single month and they don't renew at the end of the month, at the end of the 12 months. So also with the retreats, people say it's lifechanging. This is something they want to do again, but they don't repeat. So and they're also not profitable. So they eat out like 50% of the margins. The retreats is just too expensive. So, my plan after talking to ACQAI and just rehearsing is to sell the retreat plus a community package as the front end at like $5,000 and then we improve the offer by including like three months of one-on-one accountability with a team member like coaching with the team member. >> Okay? >> So, we can get them results and then we can upsell them after the end of the three months. Hey, do you want more accountability? Let's do this. And you can join the retreat. And also inside the retreat, we can upsell to a more premium retreat twice. You should be are you I'm assuming you're not closing out your retreats. >> Yeah, you're not. >> Yeah, you need to sell out your retreats. Like that's the issue. Like I'm just telling you right now that's the problem. Um I agree with the ACQAI of of me uh on the front end. I do think yeah having a five or sixk offer for for this type of thing for call it an annual subscription of events works for consumer you know consumer mail audience. Um you can add in the 101 that's fine. I think that'll be a good sweetener. I think the biggest issue is just that yeah like a delivery event will not be profitable if you do not sell. It is a it is a cost unless you sell. >> True. And then we we also saw that they tend to kind of value more in person and online things. >> Yeah. So does every >> and people that purchase both they keep purchasing. >> Yeah. So sell more of that. >> Absolutely. That was my plan. So I just wanted to >> Good. No, that's fine. Yeah. Put all the package together of the stuff that people value the most. price it accordingly and then when you have them come out get them to renew early. So the big I'll I'll just give you the big mistake which is people will get afraid of renewing people before the end of their subscription. >> Do not do that. >> So if someone has four events they're going to go to which I think is a lot by the way. Um I think you'd be probably better served with two or three. Four is a ton. Like it'd be better to have four and then say pick two or pick three. That way they have more flexibility. Um, and then when someone's at their second one, that's when I would sell the the renewal with some sort of faster action thing while they're in the moment, feeling good, they're in the vibes, rather than going home feeling shitty. >> Yeah. And then after like a year, they come back to us, hey, can I join again? >> But and also I have a plan which is we have like the main retreat like online event and then inside the online event, we'll send them like a more premium one with less people and more expensive like maybe more support, something like that. That's fine. >> Perfect. >> That works. You just like you're just not selling from your events and you're selling you're selling peacemail rather than all at once. That's it. Two changes. >> Perfect. That was the I said >> appreciate you. All right. Say >> could you ask them to grab me a chocolate shake? >> Say again. >> A chocolate shake. >> Thank you. >> Christian, what's up, man? >> Hey, >> I feel like I see you every week now. What's up? >> Ah, I got I got to make sure I'm active. You got to make sure I'm active, man. How you? >> Good. What's going on? >> God bless, man. Well, my name is Christian, also known as Retainer Poppy. Uh, I help Tik Tok shop affiliates close high ticket brand deals and uh we're actually at 1.5 million so far. So, it kind of went a little down. Uh, we're on track or we want to go to 10 million a year. >> Mh. >> The constraint used to be brand deals, right? >> Fix that. All good. current constraint is finding qualified affiliates with the cash to spend to now join the higher ticket offer used to be 4K for a month. We changed that to being uh 20K for 3 months and then the tail at this new price that the closing ratio went from 96% down to 20 30%. So, >> okay, >> huge thing. The plan was to go to 30K for the three months and then have the tail. >> At the rate right now, I like wouldn't be too confident because like 20K, I'm like, damn, it's not closing. Okay. >> At 30K, I'm like >> like, you know, >> so the it's finding affiliates with the money to spend. >> Yeah. >> Uh I've done the paid ads, organic, and I'm ripping on organic right now. Personal brand, so I'm charging higher rates, and I have way more testimonials and and proof that it works. Uh, however, I'm not hitting it. Like, I'll hop on these calls and everything and I'm I do all the closing. >> Yeah. >> And it's still not hitting as before. >> Yeah. >> My margins went from 80%. >> Very nice. Down to 37.5%. So now I'm like, >> how did the margins go down when you like where did the cost come from? >> Yeah. So it went into me funneling a lot into Well, now I hired more people. So like that was one thing. I hired like a brand choir. I have more teams, have more six figure employees, support reps, all that. >> Um, >> run g ripping on claw and AI. >> Yeah. >> So, why don't we do this, which is that um >> if I you you feel I know you're always positive, but like you feel a little beat down. So, um I'm going to bet like why don't we basically in order to make an ethical change in the offer, right? You can lower the front end price and then just basically add a point or two on the back. That way you don't have to feel like you're right. And so that way when someone comes in you can say, "Hey, it's 10 grand and a little higher on the back." So you can get you can that should increase your sales velocity. I doubt that that like going from 20 to 10. I'm not normally a price guy of of lowering it, but I'd rather get you back into kind of like feeling good again. Um, >> and then the the percentage on the back is where you can basically maneuver it. So, if someone's like, "Hey, I paid 20." It's like, "You can give me more of all your deals." And they're like, "Ah, you know what? I'm I'm fine." Right? Because you have you have an issue where like you're dealing with >> you're taking people who are fundamentally broke and you're showing them a way to make a lot of money. And the way that that works traditionally is that you take a percentage of that money, but you're also charging to do it, right? Um, basically to derisk yourself if they don't do the work or whatever. Um, and so yeah, I think we can just do this. Okay. Okay. So, currently it's 20 and then I have 10 on the back. I know we were going to do tiers. That's what I'm going to do the brand acquire on because this machine's not running up full percent. I can't even guarantee like, "Oh, hey, all right. You pay me more and I can give you a higher level of of brands." So, I'm just doing 10k on the back and then front is 20. Would you now do 15? So 15 >> just to give yourself like again this gives you room to exper because when you have two levers it allows you to do experimentation on the front end and have more unique deals. >> Okay. So we're like I should not even like consider going to 30 or >> Well, you're not closing 20 and so I'm I'm concerned about that. Uh and so either we have to get better avatars to your point, >> right? Um the thing is is the best avatars have agents, >> right? >> Yeah. >> Right. And so like you are you're you're trying to get in this in between hybrid world of like not an agent but an agent kind of thing. Um and so there's going to be a cap on that because the guys who truly can get those million-dollar deals, etc. have somebody that's representing them where they've already done deals, right? >> Um and so you're you're you're trying to get these like emerging stars, right? That's kind of like what you're what you're capturing. >> Um and so yeah, I think we just play with the percentage. I'd rather get your sales velocity up so that you stop, so you don't feel weird. >> Okay. Okay. And then as far as like the the avatars go, um just wanted to mention this because I I know I get to talk to you, but I want to mention this. Uh so, you know, in info, you have like your little pond and like you talk to this person. She's like, "Oh my god, he's the best. Great, great, great, great." I scooped up a lot of this pond and I have a few more outliers, but the pond is like, "That's the pond. Now I'm finding a new I got to find a new I'm like a new avatar. I'm susing. Should I keep making my content for like moms and this and that and the third of my first avatar or should I now look >> I don't think I don't think you should change your avatars like you haven't like saturated the market. >> Oh no it's like 45 clients. It's not a lot. >> Yeah. No, like you haven't like No, I don't think you change your avatar. >> Okay. Okay. >> And that's what the brands you have like they all know. >> Yeah. Like your whole your whole brand list suits that avatar. Like I would not like changing an avatar is like probably one of the biggest changes you can make in business. So, I wouldn't do that. Yeah. I think we need tweaks. We need more sandpaper. We need less chisel. Like less hammers. >> Let's go. Thank you. >> You're close. It's just a pricing tweak. >> I wouldn't I wouldn't get you Ben out of shape. >> Let's go. >> Thanks, brother. >> Hello. Hello. >> What's up, Abram? >> How are you today? >> Good, man. What's up? >> Um, well, I my name is Abram. Uh, I sell an easy weight loss program for women. Uh, we are on track for a little over four million dollars this year and I would like to be at 12 million. Uh, what I believe is stopping me is having a lead magnet that builds so much trust that my show rates, my cash collected, my lead volume are all high enough for my team to hit their goals. So, I did the rule of 100 and I made the best lead magnet that has ever existed and it is truly better than people's paid stuff and I'm giving it away for free. I have never put more time, energy or effort into anything in my life. So now I am absolutely terrified because this is launching August 9th and if I mess something up now I just wasted a colossal amount of time and my team and their lives suffer. So I don't want them to pay for my mistakes. So >> well they're going >> do you have words [laughter] of wisdom here for how do I how do I maximize this lead magnet? So it is a book an audio book and a YouTube course and then the actual lead magnet that they get from that is a like they opt in for a book uh like an email opt-in. So, you know, is there specific things I should put inside the book, the audio book or the YouTube course or in the email sequence or something? >> Let me give you the the biggest 8020 on this thing. Um, which is I don't know if you've like tested the name of the lead magnet. >> Easy weight loss for women. It's a book. >> Yeah. I would just I would test like 10 20 30 different names because it'll have like lead magnets their primary value in the beginning is to capture the lead. The lead hasn't consumed the lead magnet yet. And so how you name it is going to be that's all they're going to have consumed right before they decide whether they want it or not. And so like one of the biggest levers on what like on all that work you did is the packaging. >> The title. >> Yeah. The title and the packaging, man. >> So I would test the out of that. And like you can run that with like simple ads and just look at CTRs. Um, and you can also test the opt-in on the landing page. Like don't feel weird about again the world is not perfect. Like if you have someone opt in for one lead magnet uh and you change the title uh and the other one has like the old the old ebook cover, you can still send it to them with that cover and no one's like really going to get weird because it's free anyways. Um, >> but I would I would strongly recommend testing that. So it's like thing number one, flashing lights. like please do that. Um the second thing is um you said you you feel like your your biggest constraint is a lead magnet but behind that is that that people do not trust you right? >> Uh well I would I would assume it's the trust thing because if the show rates are not high enough the cash collect is not high enough you know like we have to warm people up. >> Yeah. >> At some point you know in the process. if I could just build that trust beforehand by making my free stuff actually valuable. >> Yeah, the I think um you are thinking like a pure direct response guy. Um and the best lead magnet is content because it's distributed for free and then they become your warmed up audience. I think the value of the lead magnet though good um not everyone will consume it etc etc and so like it will work to get leads >> um if someone actually does consume it they probably will buy uh but the if they consume it is the big the big if and so I would also not be afraid of breaking the lead magnet into hundreds of smaller pieces and using those as content >> to then you can again funnel to it's like this is a small piece of a bigger pie you can go grab it >> um and I think that would also help. But at the end of the day like >> trust if we break it down into behaviors is just that you have you have told them things that when they followed them good things happened. Um which is that you just want to have more influence over them. And so the way to do that is to just give them help basically help them first right and so a lead magnet is a way to do that but content is another way and it's free with distribution. And so like if we look at the biggest weight loss brands that exist, they almost all have big brands. You know, they are big brands or have big brands that promote them. And so the lead magnet will be a component of it. I think the names will help. Um but longer term, it's going to be like building out the content machine that's going to give you the the the trust in advance and then maybe getting people to make the content for you. >> So I mean I I put out a metric crapload of content as it is. I got I started posting two years ago. We have over two million followers. We get, you know, thousands of leads every single week. Um, but it's like >> I'm also like cracked out on paid ads. So, >> how many of them That's weird that So, but you you've done 4 million this year or 4 million run rate. >> Uh, we're on track for 4 million this year. We did like 3 million last year. >> Okay. Yeah. Um, I don't know what the views of your organic is looking like. Um, but of the people who are coming in, have they seen your content? Uh, some of them. >> Okay. Yeah. So, I'm just saying like to what degree are they strangers? >> Uh, I would say 90% are strangers. >> Yeah, that's interesting given given the size of the Instagram. Um, [sighs] >> so your issue is that show rates are not high enough. >> Well, I mean it would be everything. It'd be show rate, close rate. Um, like I my assumption >> is that if they trusted me more then everything would be better, you know, like so like if I want to build that >> we agree there. though. Uh because right now what I'm making most of the money in is in a webinar >> which is exactly what cranks like everything. >> But that is still like a I don't have anything that runs in the background. Like if I had a a lead magnet that was actually good and I could just send that to everyone, have them do it versus needing to show up to a webinar. >> Well, I think if you try to replace webinar with lead magnet, it will not work as well. >> Oh, no. in the background. I'll keep running the webinar forever. But it's just like uh this is like if they like that, they'd be more likely to show up to the webinar. >> Yeah. I mean, you could also give that as a as a carrot for the webinar as well, or a portion of it as a car for the webinar as well, just to get the odds in. >> Yeah. >> Um but the main the main vein here is add webinar sales team, right? >> Correct. Yeah. And so from the webinar, you're saying the sale the show rate on the sales team is low. >> Um the show rate to the webinar is probably the lowest thing. I mean we got a 30% show rate on the webinar. >> That's fine, dude. >> Um but it's >> the KPI for a webinar for cold traffic is 25. >> So like you're fine. Like that's you just have to make the math work there. Like you're not going to I mean sure it's diminishing returns at that point. Like there's probably somewhere else that would be you'd have greater leverage. Okay. Okay. So, let's assume that the show rate is not a problem. Um, of the people who show, what percentage are are are booking? >> Uh, we got uh 10% booking rate >> of people that show. >> There's just not that many people though, you know, like it's the the opt-in rate is probably the the biggest thing. It'd probably be because like out of a thousand people, we'll get 50 people that actually register for a live webinar. >> You mean a thousand clicks? >> Yeah. 1,000 clicks. Yeah. Okay. So, you have a five you have a 5% opt-in rate. >> Yeah. >> Well, then yeah, man. I think that is the >> if we're looking at webinar metrics, right? Um >> that's probably the biggest constraint that you have because the 30% sure up is fine. The 10% is probably low. >> Um that should probably be closer to 20 if it's a book a call CTA rather than a purchase CTA. >> So, that's that there's something there. But the biggest by far is the opt-in by a mile >> because like you can be at 25 or 30% there and like that's where you have, you know, like a five or six there. So if I were you, I'd be looking at um the ads matching to the opt-in page and I would be like my quote rule of 100 where I'd be focusing all my marketing time would be on that page. >> Like how do we make this clear? How to make this simpler? How do we use more visuals? we um call it add trust, right, to that page and just make it more enticing and more interesting um than what it currently is because that like again it's like I look at the averages here. If you're a 30% show it's fine. Like it's not like we're not g we're not going to get like you're not going to get from 30 to 60. It's not going to happen. >> But you can absolutely go from 5 to 10. You can absolutely go from 5 to 20. >> And so that's that's where I think you have your your 4x >> is in the optin. So, does the the times that they have open in order to opt in for it, is that a bigger leverage? Like, is that for sure a leverage test? >> That is for sure a lever. >> Mhm. >> Do you have just in time right now? Is that how you're doing or are you doing uh >> No, there's two there's two that are It's twice a day, so it's at specific times. >> And you're doing both of them? >> Yeah, it's broadcast live. I'm I mean, I did it, but I'm not doing it. >> So, it's recorded. Yeah, it's uh two Zoom still. So, they still join a Zoom thing, but it's twice a day and they have to register for it. Correct. >> Well, I would hardcore consider it just in time. >> Well, if I do that, I the show rate drops down to 5%. Uh, so it's like the like uh >> so when I when I do the the thing, what happens is they go to a VSSL right after >> then they get a bunch then they get like the email optin >> and then a couple hours later the webinar goes and then the show rate goes from 5% to 30%. But it is recorded right now. Correct. It is auto. You're just picking two times. >> Correct. Yeah, that's what I'm saying. I could just pick different times if that would would potentially be the thing. >> I mean, what matters is they feel as though it's real. >> I'm guessing. >> And it's actually on Zoom. Yeah. >> Yeah. Know, I get it. Um, yeah, the big lever's there, man. That's the big lever. Bigger than everything else by a lot. >> The the time or the >> It's both. I'm saying 5% is the problem. >> Okay. >> Yeah. 5% is the problem. Availability is a big, you know, a big thing of that. Um, God, there was this guy who had this this little hack that he did which is like he had this thing where was like it just started two minutes ago when they were there like one live right now and that like murdered for him. >> Yeah. I mean you could just in time you could do it every whatever but it has to go to a different software. >> You mean instead of Zoom? >> Yeah. Instead of Zoom. Yeah. So that's the one I did before with the terrible show rate. Even like at the the peak of my webinar, if I'm looking at the stats, I get up to 9% of people that opt in. >> That is the lever though. I'm just saying. >> So, more webinar times or different webinar times? >> I would say page. >> I mean, and and both. Yeah. >> I mean, page the promise on the page. Um, and then the availab availability in terms of like their ability to schedule. But like if I'm if I'm you, all of my focus is on this point. So basically all the permutations of my testing and all my obsession would be here, not on the show, right? >> On the the optin. >> Yeah. >> Yeah. And then >> and like I think the webinar could probably be improved if it's at 10%. It should probably be at 20. But like Okay. Like not the the the thing I would focus on is that >> Yeah. because that'd be like a 4x potentially that I could do. >> Cool. All right. Well, I will try all of those things and I will test all of the lead magnet titles and split it up into a million pieces. >> Good. I appreciate that. >> Thank you so much. Yeah, you bet. >> Thank you. >> Bye, >> my people. Do not spam the chat. I will guarantee that. Here's my guarantee that if you don't if you do that, I will never never answer your question. All right. What's up, Tristan? Yo, what's up, Alex? Are you good? >> Yes, I'm great. How are you? >> Fine. Thanks for having me. I'm excited. So, uh, let me break it down. I'm calling from Europe. We run a done for you photo booth business specialized on nightclubs only. Uh, we are on our way to hit 1 million revenue this year. 3 million >> uh done for you photo booths. So, we Yeah, photo booths. And we only put them into nightclubs. So, we want to be at three million in next two years. Our business model is we own the booths, we put them in the nightclubs, we earn per picture that the guest takes and we pay a commission to the club. >> Our LTV on average is 6 years plus. Reality is probably longer but nature of the business is clubs close. So that's how we lose them. But uh in in general we don't have any churn we put them out. >> Yeah. What's the revenue per uh club per month? I know it depends on the club obviously but give me an average. >> Yeah on average we are per booth we are at uh 950. um gross um which leaves that at uh 450 um to 500 a month contribution margin before HQ overhead. We run 80 booths at the moment margin. >> You give them half and then you take half to do the rest of the business. >> No, no, we give them like 20 to 25%. Okay. >> Um and yeah, exactly. And that leaves us at about 30% net margin after overhead and depth. >> Uh while thanks to you, we leveled up in leads. with doing one thing that really worked for us is doing more of what really works and what already works instead of trying new things all the time. That really helped. Thank you. >> Uh that brought us to our real constraint which is cash flow. So for new machines um if we want to hit our goal uh we need to upgrade our money model. So far we tried to upsell uh an upsell offer for the clubs that brings them from 20 to 25% up to 50 with paying a onetime fee of 6,500. But the market did not really take it. Only our flagships would take it. But they earn that money in two months. So that's not interesting for us. >> Um we have some brand partnership deals um with liquor brands. They do the the sales for us. Um so far um they were also skeptic in paying up front. So we hit a resistance and at the moment we are at like 17 months till the booth is paid back and we need to bring that to one to two. That is my constraint. the uh the booth that you have the the sides of the wall. Do you um interesting? Yeah, part of me was thinking about that from an ad space perspective, too. But no worries. Um with a business like your How much are the machines? >> Uh it's like 7K roughly. >> Okay. Yeah. Yeah. Um H I wonder if instead of owning them, you could lease them from the manufacturer. It's probably also possible. I always have the feeling that it's better to own the stuff long term. Um, but of course, we are constantly cash constraint. So, it would also be a solution. >> Yeah. I don't I don't hate that because you're still doing the arbitrage because the thing is is like if you own it in six years, it might be outdated and need to get, you know, I mean, like it might you might need a refresh anyways. Um, and what you really care about is just placing them and having the spread, right? >> Yes. >> Yeah. I I'm curious what the lease payments would be because like if you didn't have to pay $7,000 each and just had to pay like $100 a month or $200 a month or I don't know what what it would work out to be that would basically like you'd be good to go. >> True. Never I actually because I always thought I want to own them and uh that's a good idea. >> The thing is they're not an appreciating asset. It's a depreciating asset, right? Like that like 10 years from now a photo booth is not like more valuable. >> Yeah, that's true. made [clears throat] most of the time we just change like the software and a little bit the life inside but the cage >> it's like it's been there for I don't know for 30 40 years didn't change too much >> yeah but I I got you I I love the point I never thought it way I always thought okay we we buy them um there are definitely providers that do this um we will hit this and just do a test run with a few boos and see how the numbers are >> so this is a model issue so in terms of like because again it's like you have a you have a very understandable business like it's very straightforward and it's also very predictable which means that you could just model this ent,000 per machine instead of seven but it's going to be over five years that will materially improve our business and whatever like we just see these as cash flow streams and your your net would should go up >> rather your net free cash should go up. >> Yes. Yes, definitely. Cash flow will go up. Of course, most of the available cash goes to building new machines at the moment, >> which I mean, if you're trying to maximize for not, you know, for not paying taxes, you can basically get your income down to zero because you always just buy more machines. Uh, but >> right, but then you're not making any money. >> Uh, so it's a bit of a, you know, kind of a catch 22. Um, I don't know like if if Yeah. where where that business gets interesting in terms of the purchasing versus the leasing is you can do some fancy finance stuff so that you can like it depends how you recognize the rever how you recognize the cost like there's some interesting things you can do there. Um but if like the constraint of the business you basically have two options outside of changing a business that already works. option one is that like you can get a capital injection meaning like you sell a small part for a big amount of money and then use that cash to then get you from 80 to you know to 200 or 300 or whatever because yes like if you had a million bucks right >> that would mean uh you'd get 13 per million I'm just rough math right uh 13 13 um things per uh sorry per per 100k uh so you get 130 more with a million dollars right and so that would >> almost triple the business. Um, not quite, but almost. And so it's like maybe somebody be willing to do that, but I would probably just look at the lease model if that was the constraint of my business because if you can just do that and you can scale limitlessly, >> that's not too bad. >> Why not? >> Yeah, >> true. Thanks, man. I think actually for this I have a lot questions, but for this I'm totally fine and I will try it. Um, sometimes it's so obvious and uh, yeah, we thought many ways, but not the obvious way. So, thanks a [laughter] lot for that. I'm glad I could help it, dude. Appreciate you. Thanks for saying, >> Alex. Thanks, man. Bye. >> You bet. >> All right, Denzel. >> Hi, Alex. >> What's up? >> My name is Denzel. >> I sell done with you and done for you due to growth to Spanish speaking business owners. >> Okay. >> Our core offer is a 10K euros three month program. We did we did 500 10k on 2025 and we are on pace for 700K on 2026. I want to hit 2 million per year. But what is stop what is stopping me is mainly uh lead supply and that's giving me big changes on income every month. We've had some months where we've done 100k euros then 30 uh yeah >> 35k euros next two months >> we have two marketing channels cold email and organic YouTube content uh we run a two call close uh on cold email uh so I have the metrics of the last uh 10 weeks but I'll skip them for now. Uh the funnel more or less works. The problem is the pond. I've checked on Apollo and the data says pure cold outbound has maybe one to three months of fresh ICP inventory left and last week was our lowest volume in two months with zero uh closing calls booked. Um so that's one thing. The second market marketing channel is uh organic YouTube content. I have my personal channel, our podcast and MIT's channel. Last year we did 7k 200k views per month more or less and converted really well as inbound engine but this year we can't get any channel out of uh what's the issue >> uh first how do I fix the big changes on income second uh to 3x to 2 million do I keep betting on the same market with high volume or uh hybrid model lower personalization volume hyper personalization on the best qualifying list or is this niche simply too small to 3x squeezing it harder meaning >> no I mean the niche isn't too small you're helping business owners create YouTube stuff >> no the niche is not too small like you're fine there um the volatility of your lead flow is because your organic is volatile >> so if you have a good video that rips >> you'll get more leads if you have most of our uh sales come from um cold [clears throat] email >> you're not getting anything from your YouTube >> uh almost which is ironic because that's what we do for clients. But yeah. >> Yeah, that's I mean that's a problem but I won't I won't even address that. >> That's that's a thing but yeah. >> Yeah. Okay. So no I mean cold email isn't too small. I mean you can you can continue to grow it. Um [sighs] I am surprised that your your YouTube is not generating business if your whole point is that you can help people build YouTubes to generate business. >> That is somewhat concerning since it's literally what you sell, >> right? >> Yeah, I know. I know because we have clients that in first month they are doing 500k views per month on long form and that's awesome to lead generation but we can do it with ourselves. It's a little bit strange. Yeah. >> Do you put CTAs inside of your content? >> Yep. Um 30% of the content uh end of the video, first comment in first link of description. >> Yeah. >> Like the whole playbook. >> Yeah. Very interesting. Um I mean fundamentally you would need to do more or you can run ads, >> right? Like if you're making content right now, it's very odd that your content's not converting. I I don't have time to to dive into why, but that's one thing. Um I don't know what the nature of the content you have is like is it very clearly educational around this specific topic for that avatar or is it just like getting views in general? I don't know. Um but that would be something to look at like basically it's showing that like you're if you're not if you're not able to sell from your organic it means that you don't have influence. And so you have to figure out why you don't have influence because fundamentally if you give people good advice that helps them you know grow their grow their business or YouTube then they will >> want to give you money to help them. Um yeah like it it's just it's just that cold email as you continue to scale gets more and more complex, right? >> Yeah. >> Um and so there's nothing wrong with it. Like you could absolutely just do more and you have to cycle through more >> domains and warm up more, you know, all that that whole game. >> Yeah. Um but you will you will eventually get into the world where you will run ads. >> Okay. Yeah. Because >> right now our whole world is called email. >> Yeah. >> But if an account gets into spam is two months of uh suffering. So >> well I would I mean are you not spinning up multiple accounts at any given moment? >> Yeah. We have like uh I don't know how many but between five and 10 domains with three or five sub accounts on each domain. Yeah. Yeah. Okay. We're doing that. >> Yeah. Um but just so you know like the nature of the business you have is that it's it's coaching, correct? Or is it's done for you? No, it's done for you. >> Yeah. >> Done with you and then we have an absolute for >> done for you, right? But when you have done with you, it's education, which means it's almost entirely transactional. And so if you want to scale the business, it's almost entirely scaling acquisition because no one's staying for more than a year. And so whatever your revenue is is what you were able to sell that year. And then you every month you have to start over at zero. It's one of the unfortunate things about education, right? >> Plus side is has good margins. Downside is there's no recurring revenue, right? That's that's kind of the trade. Um >> but yeah, you'll you'll probably have to venture into the ad side. Um and having the the larger YouTube the thing the biggest the big red flag for me to I'll be really honest with you is that you're using the thing that you sell your clients and you're not getting anything from it. Like I don't like that for a number of reasons. I don't know if you want to dive into organic content because I know that's some time but uh I think the main problem is on impressions because we have we we've got great CTR great uh retention I think main problem could be on uh impressions because um when the video is about how to grow on YouTube in general we get some impressions but uh low qualified leads maybe gaming channel kids with uh game plays channels. Uh if I do a video about how to get more how to get more leads, I get 300 views. Like it's absurd. >> Yeah. So, um I've got a buddy who I think he's like 25,000 on YouTube and he does two and a half million a month. Uh >> right. And so, like views don't matter at all. [cough] >> Yeah. >> At all. Well, 10% they matter. Uh they only matter if everything in the content is catered to the correct avatar. Once all of that's right, then views matter. But until that, it's just getting people it's it's showing people who aren't going to buy your thing stuff, which whatever. And so my bet is that the nature of the content you're making, like you said, you need to learn how to make the content that's getting 300 views to get 30,000 views. Okay. >> And I'm going to also bet that part of the reason that it's not doing as well is because you're not good enough at it yet. >> Meaning, [clears throat] if you want to teach the stuff, you're having a hard time teaching it because you're not succeeding at it very well. >> Like, you could probably teach more about cold email than you can about >> about making a YouTube. >> Yeah. >> Do you know what I'm saying? >> I understand it. Yeah. >> Yeah. Yeah. And I'm not trying I'm not trying to make you feel bad. I'm just saying like where is your true expertise? >> Like you're not generating 500,000 a year or 700,000 a year off for YouTube. You're generating that off cold email. >> And so like your ex like you're teaching you're selling a customer acquisition channel that you are not using. And so your your depth of your ability to talk about the subject which is what where you demonstrate expertise is probably limited because it's not working. >> Okay. But it's working for our clients like we do it work for our clients. It's not working for us. But I understand you. >> Some, >> not all. >> Yeah, obviously. >> Right. And you're you have the you have you have the business that would be the most catered to like making YouTube videos to get leads. >> Um, but so like I I'll just be with you. I think like you solving that is probably the the most important thing. I think getting to a million, you can scale your you can scale your cold email to a million, no problem. Um I think getting you know going beyond that is just going to take more and more kind of operational tech complexity. Um your eventual state though will be getting to ads. That's where you'll end up. >> All right. So should I just >> do more cold email? >> Do more cold email. Improve the quality of your content. That is the correct content that gets you the right leads. Don't make more videos that get that don't get leads. There's no point. Why? Right. There's no point. >> Yeah. 100%. Okay. >> And then do those two first. Get to a million. Do that. And then once you do that, then you can experiment with this the ads. >> Okay. So once I'm at 1 million per year, I can start with it. >> Understood. Thank you so much, Alex. >> You bet, man. Appreciate you. >> Bye. >> All right, Eric. Nice nose strip. >> Thank you, Alex. Uh, hi, Alex. My name is Eric Roberts. Uh I sell sustainable online weight loss coaching to busy professionals 30 to 55. Uh last year we did 3.2 million and this year we would like to do 10 million this year but hopefully soon like to do 10 million. Uh but what's stopping me is >> consistent lead flow and signups to outpace structural churn. Um, and if I don't solve this, I won't be able to continue to give my employees raises and great lives, which I take very seriously. And my parents retired this year, so I'd love to help them financially in retirement and just give them a really cool retirement life. So, yeah, I've got I've got good news and bad news. The uh the bad news is you're never going to solve churn with weight loss. It's it's the nature of the beast. The good news is you don't need to focus on it anymore. [laughter] You need to focus on everything else. So like there are so few like massive true weight loss coaching businesses in existence because of the core problem that you have identified which is it's a pure distribution game. Like if you're in weight loss it's marketing. Now, you can the people who make the most money in weight loss are the people who sell the plumbing to weight loss, right? Like, so you could sell supplements, but it's not about weight loss. It's just like it's stuff, right? Uh you could sell, you know, peptides and you'll make more there because it's stickier. Like people are happy to inject or take pills and powders and potions than they are about like coaching and changing their lives, right? And so I only say this because I spent too I I lost too much of my life trying to solve this. Um, and so there are just some businesses that are just not built for it because like fundamentally even though it feels like a weight loss is kind of its own thing. It's just an education business. You're teaching someone like it's all it is. It just has there's just so many people want to lose weight that it's an industry but it's fundamentally it's just an education business. Um, and so all of your focus should be on front end which is about distribution and CAC reduction. Um, under the assumption that what do you what's your price point for your thing? Um, so we have a front-end 8week challenge that's between 500 600 a month and then 60 to 70 people then percent of people take up on a six-month transformation package after that. So um, so yeah, it's same price as well. And then if for the 30% of people who don't take up the sixmonth one-on-one transformation, we have a downell continuity and so on and so forth. >> So are you selling one to many on the front end or you selling phone on the front end? You're saying yeah >> for the oneto one uh it's phone calls and I do all the sales calls. >> Interesting. Okay. So then on the front end for the 500 for the the 8week thing that's like five or six hundred bucks, right? You're not taking sales calls >> per month. Yeah. >> Yeah. Yeah. Are you taking sales calls for that too? >> Yes, sir. >> Jeez, it's a lot of sales calls. >> It's a lot of sales calls. >> Well, so that's it's not So I average about 15 sales calls a week. And so I think that's where I'm like I need to get obviously get more of those. >> Yeah. Well, I mean it's it's it's pretty compelling that you're doing the numbers you are with only 15 sales calls a week and you're still running the sales. Like that's actually very impressive. Um yeah. So LTV is what? So if you have $1,500 on the front end, call it right is what you're making per customer and then half of those are buying a what price point on the back? >> Uh same price point just a six month. So somewhere between like if they pay in full they get a Yeah. So three to four grants somewhere like that. >> Okay. And what's attrition on that is like because you say churn is a problem. So what's the issue? >> Mhm. Um I would say after those initial 6 months or I guess the full eight months because 8 weeks plus 6 months I think that's where it typically tends to drop off. But then it's just like we keep people for eightish months, but then it almost seems like every week I sign 10 to 15 people up, but then 13 people cancel. So it's just to >> Yeah. They leave on the end. Yeah. They leave on the back side. [clears throat] >> So I'll give you a a simple tactic that we can do just to give you a little bump. Um but then the majority of your focus should be like basically do this first and then and then focus on the front. Um which is when are you selling the renewal on the back? >> Four weeks in. >> Okay. I mean Yeah. I mean the like you want to have multiple hits at the piñata, right? You don't just have to smack it at once. So four weeks is good and and it's um it's six months, right? >> Yeah. [clears throat] So I have um you already are doing a backend ascension, right? And your your your your front end your frontend upsell rates are fine. So I'm not I don't want to touch that part. But the backend part on the six-month thing, um week four works. I would also throw in a any milestone that happens and then halfway and then last chance and so last chance should be the month before cancellation. Um those would be the four times and do you have coaches right now? >> Yes sir. Yeah. So, I would have I would have my meeting with them, like your sales meeting with them at the halfway point. And then it's positioned so that you're like, "Hey, this is just my way for doing quality assurance, making sure that you know like you're having a good experience. Tell me what's going on." And the close that we use there is basically all roads lead to Rome, which is that like um if things are going great, let's keep the party going. If things are not going great, you need more help, so let's get let's keep the party going. Like either way, like you have you have a reason to buy. Um, and then yeah, last chance is is last chance. So, we want to do that before they end the thing because once they're once they're done, you know, completed their six months, it's a new buying cycle. And so, we'd rather catch them right before any of that stuff happen. So, we want to have multiple licks of the of the of the ice cream cone. Uh, beyond fixing that, right? Uh, and that's just probably just going to get you a lift. The big thing after that is probably going to be like, and if you want, you can improve the offer um on the back. So, it's like, listen, and you could justifiably say this, which is just that um it cost us a lot of time to get you onboarded, way less to maintain you because we had to do all this work together. And so, basically, it's double it's double your money on the back. And so, you can sell you can sell a year on the back for the same price as you sell the six months. So, it's like buy six, get six um as just a more compelling offer on the back. I would just I'd backpocket it because again the cost of you you know this by the time month six or seven like they're kind of on autopilot and so your gross margin will still be fine. Okay, that's what I would do on the back end. Um the only like you are you're in a distribution game which is either going to be from brand or or media arbitrage in terms of your ability to buy buy media. Um, a lot of the big brands like will typically have like you probably don't want to get into the peptide stuff, but that is crushing right now. >> Just saying like it is >> Well, it's funny. I actually partnered with somebody who does like blood work and GOP1 and peptide and stuff. So, I'm considering it. But, >> yeah, I would look at it because I think like the LTV on this customer is significantly higher. It also allows you to have kind of pseudo medical positioning which allows you to have more price uh, you know, flexibility. Um, basically I'd probably do that all that backend stuff first and then I would go gas the front end because with the enhanced deltv enhanced gross margin um, and hopefully some stickiness on the on the kind of like medical stuff that should give you more cash to be more aggressive because like if we can if we can add 50% to LTV or lifetime gross profit if we just did that that would be pretty material. Uh, because that alone would allow you to just just spend that increase on more customers. Are you running ads? >> Um, so I literally just started running ads like two months ago. Everything's been organic beyond that. >> Yeah. Uh, once you get into the ad side, like that's going to take you from 3 to 10. Pretty straightforward. If you've done this all on organic up to this point. >> Mhm. And then with the ads, I have been I did all the math this morning. Roughly like a 135 CAC. And so like are you at that point? What's that? >> It's great, dude. >> Okay. Uh, so I should just then just spend more on ads. >> Yeah, it's I mean that's a stupid C, dude. >> Okay. >> It's a tiny CAC, bro. Tiny. The teeniest of CCs. >> I've I've been told that in anyways. [laughter] Cool. >> Okay, sweet. Cool. Super helpful. >> Like I would do these things to the business anyways regardless. But yeah, gas the out of it. >> Okay, cool. Thank you so much, man. Appreciate that. Congratulations to you and I on your son. >> Thank you. Appreciate it. Do we have more nicotine? Don't worry, I'm gassing up for you, Darina. >> I'm going I'm going full full steam. Eric's tiny cat got me super distracted. >> You grab some. All right, cool. Let's do it. >> All right, so context. I place train content operators and editors with service businesses, coaches, and founders. Our operators are based in Ukraine. We handle all content management including stretches, scripting, editing, short form, long form and volume. Now um we build the strategy, place the person and then we manage them for you on a monthly basis. Yeah. >> Right now clients pay 6,500 upfront and then 2500 per month. Okay. >> Uh we are tracking towards 800K this year and margin. >> The first time we talked you were at like 200ish, right? >> Yes. >> Nice. There you go. A little 4x. >> Thank you. Thank you. But still off referrals though. So yeah, uh we've been doing really well, but right now the biggest question is how do we build the system for client acquisition? I'll explain why we haven't built it yet because it's been kind of chicken and egg. You get more clients and then on the back end you're like trying to make sure everybody's working really well and we >> By the way, that's how service businesses work >> really. >> That's how it works. >> But it's just like yes, chicken and egg. And the stakes, I know I needed to mention stakes. They're personal. Um, obviously my family from Ukraine, so there's a war back home. I support my parents right now, pay for mortgage, um, you know, make sure that they're well. Um, but yeah, that's where we are. If you had 90 days right now to grow the business to 1.5 this year and then, uh, get it to a million a month. Uh, what would you do? What the channel would you activate to actually get the leads? And also, apologize for background noises. Somebody decided to do ren so you're fine. >> Okay. Um, >> well, how many customers can you handle on a per week basis? >> Well, now we can handle more. So, right now we have 45 people on MR and then we can probably take uh 10 more people every week. So, finally, I think we kind of fix stuff on the back end. Um, so that's >> and what's churn? >> 3% >> monthly >> year >> a year. Year. >> Yeah. Great. Okay. So, I mean, your LTV is absurd, right? I mean, you're looking at, you know, 6000 plus, you know, virtually unlimited LTV. For the purpose of the conversation, let's just let's pit it at 12 months. So, it's like you're making at least 30, but your gross margins are a little lower. So, you have to pay the the editor, what not. So, what are the gross margins? >> The gross margin? >> Yeah. >> So, 16 165. >> Okay. 65%. So, they're they're a,000 bucks and you're and you and you make 1,500 extra to like run everything else. Yeah. >> Okay. Got it. Um, that's fine. Okay. So, [sighs] you do probably have a little bit of pricing sensitivity there. I won't like get into it, but you probably could get up to three, but we'll I'll I'll leave that alone for now. Um, just because again, when I see that you're at 3% annual, like you're fine. Like you you probably like no one's leaving, right? Because you're obviously doing a good job on the stuff. Um, so we just have to increase your demand. And so I'm assuming, are you running your your model? Like are you running your people to make you content >> now? Yes. So now, yes. I have a lot of content ready to go to be honest. Yeah. It's because I wasn't running it because I was afraid that everything's going to break on the back end and with AI now releasing stuff every day, we needed to make sure everybody's on board and know what's going on. So, I haven't been doing it, but now I have the team ready to go and we're implementing this week. So, >> yeah. So, if I were like if I were to take the business over, I would be going aggressively on the content obviously. Um, you're that way you're eating your own dog food. You're you're demonstrating the stuff and the majority of the content should be about what content to make and what formats are working well right now. Uh, to and you're looking for business owners, right? Yeah. And to generate leads, right? It's like you want to show basically everything from basically the entire process up to the sale, how how the content machine works, so to speak. Um, and just go really in detail, like don't worry about the views. Just worry about like making sure that the person that watches it is like, "Oh, this was good." Um, and they just you want to demonstrate that someone sees that and it's like, "I don't want to deal with that. I'll just have her do it for me." That's what you want someone to like think when they watch your stuff. Um, but if I had to double the business, I would just run ads, right? [laughter and gasps] Like I would make the content. Why not? Because I would take that and then those become the ads anyway. So you have you have to make creative either way. And so you might as well just make them as content and then find the good ones and then just run those ads ads directly. Um, but that's about it. Like you're you've got you've got a good business. You have absurd churn for the nature of what what your thing is. Expect your churn to go up when you're getting to colder audiences not that are not referrals. So, like up to this point, you've only sold on referral. Uh, which is wonderful and also terrible because it's like means you've never actually sold. Uh, because people are like they already know the price, they already know you, they already have an embedded testimonial who's a friend of theirs. So, they're just like, "Yeah, I'll just do that." Um, I wonder if you really wanted to, you could probably, this is a little bit of a riskier play, but kind of interesting is like you could say, "Hey, I'm going to be bumping the price to 2500 to to 3,000 a month." Um, but if you send me a referral, I'll keep at your old price. >> Okay. Um, great question on the ads. Uh, right now we try to run ads, but everybody who we attract, they're kind of less than 1 million a year. Right now, my ideal client >> million plus, they probably run ads. They tried hiring. They know it sucks. They don't want to manage people and they just need somebody who is going to come in and just take over and do content for them. >> Just say that. >> That's the ad. Oh, okay. >> That's the ad. >> If you're a million dollar business owner and you run some ads right now and you've probably tried concept, but it sucks and you don't want to manage the person. I have a whole team out of Ukraine. I have 3% in insurance so people actually think my stuff's good and that way you can just have it outsourced for less than you'd be able to do in the US. >> Okay. Okay. Perfect. And and would you lock in people for longer because right now it's monthsto month so they pay >> you don't need to. The upfront the fact that you have an upfront that's you know two or three months of of expenses is is fine for now. Um, and the thing is is that there's contracts are not enforceable, at least in the US. Not really. Um, like you're not going to you're not going to put people to collections. Uh, I doubt it. So, like if you want it's only just for like the mental commitment around it. Um, but no, I would say right now I would like if I were to do one in your place, it' probably be three month. It wouldn't do 12. I would do like three-month minimum because listen, if you think that you're going to get results in 30 days, like this is not for you. >> Yeah. Okay. And so would you partnership route at all or just like adds to content right now? Don't worry about partners. Um I had partner up with somebody and I was getting a lot of referrals from them. Yeah. >> Um >> really well. So would you just double down and find communities to partner up and just help? >> Yeah, I remember we talked about this a while ago. Yeah. Uh more of that is probably a great first step. >> Okay. >> So just >> ads. We would just say like again I don't want you to do all three of those things is too much. So you doing qual good idea. It's you eating your own dog food. You got to hire one more person. and you're the customer. Fantastic. That one's off the board. Just get that done. Uh I think you then doing outreach to businesses or or or forums or groups or whatever or school communities that have your specific type of avatar is a good is a good start because you only need a couple of those for like you need two or three of them and it's like great, we just tripled the business. >> Perfect. And lastly for the ads, what would you spend? What were the KPIs that you would be looking for? I would just try to make I try to break even on the first on the first transaction. If you can do that, you're good. >> Easy. Okay. Do I have a second for one more last last last question? >> It's got to be the lastest of the questions. >> Okay. Promise you. Uh so, anything you would recommend on the back end to make sure the quality consistently stay high and nothing breaks. So once we get extra 100 clients like we can actually sustain the quality, keep getting referrals and do not go down this churn. Um [sighs] so in in quality management there's kind of two schools of thinking for QA. One is that everything gets reviewed. The second way is that it is a random uh a random number of things get reviewed from like a product line. And so you can just pull one off of the rack and as long as they know that every so often random, you know, assets that they're making are getting pulled and making sure that they're following or adhering to a checklist. Um, that will allow you to at least enforce it with more scale. Um, but I would imagine that a lot of it is just the checklist that you're having them follow, like make sure there's a hook, make sure and then just grading them against that that checklist. And what will happen is just that over time that checklist will improve is that you'll have more things that they will need to adhere to in order to increase the overall quality of all of the the shorts. >> Okay. Okay. Makes sense. Thank you. Next time we talk it'll be at 1.5. >> Rock and rollina. Congrats. >> Thank you. Bye. >> A little quadruple. Not bad. What's up, Jeff? >> How's it going, Alex? Nice to meet you. Um, so my name's Jeff. I sell online weight loss coaching for moms. online weight loss coach kick today. Jeez. All right. >> I know. So, last year I did 288,000. Um, my goal I feel like is simple. I need to get to 600K so my wife can keep staying home with our four little kids and honestly so I don't become a failed entrepreneur like my dad which is uh kind of emotional but you know this is so this is my version of scale or fail and uh I need your help here. So >> my main constraint is acquisition and so I've tried three paths. I started with organic local Facebook groups and that got me to like 20 to 25k months. Started trying local meta ads and now I run national meta ads. The local has died down with the organic. The local ads the cost per lead was really high. The CAC was over a thousand and so now I'm on to national ads. >> What? >> The CAC was at a thousand for local. >> Yeah. Because the cost something's wrong. What's what was what was the offer like? Were you were you doing like walk me through that because the weight loss leads right now are like 20ish local. >> Yeah. >> I still have my post there because of gym launch. So what I was doing was I was running a lead magnet funnel to SMS and so they went to my landing page, SMS got them onto a sales call and so I just couldn't my creatives were fatiguing really fast and I I just couldn't get the traction that I was looking and so I switched to the national side and now my CAC is at 750 and like my cost per lead is half. So like instead of 20 it's now down to like $8 for cost per lead and it's the best I've ever been at. But basically, I'm in a place where I'm trying to figure out what to do for acquisition because I've tried a bunch of things and I just hear you in the back of my head saying more better before going new and I'm doing a ton. So, like >> my question for you is just like if you were like Jeff, this is what I would do to get to consistent 50k months. What would you what would you do? Like how would you set it up? >> What's the price point? >> 2700 for 16 weeks. Um I close at 40% and then 50% resign. Sorry, we're about to have a tornado outside our house right now. You're good. Um, I'm going to say something wild for you. It's going to be very different than I think you're expecting. >> So, I ran something called a hybrid model >> at Gym Launch for a long time. And the reason was for the exact type of situation that you're in. Now, to be clear, it's not going to be a model that's going to get you to $10 million, $20 million a year, but it's like if you want to get to like 600 with like very good margins, like this model works. All right. And so, basically, >> that's all I'm looking for. >> Cool. So all you have to do is get any local gym in the area uh to give you an office that you can use and like most gyms will just you know like couple hundred bucks a month like this should not be it's very cheap. The reason for that is because again I'm talking speed to money and risk associated with it. There are more skills that you need to have in order to advertise nationally. Uh like you probably saw two of the calls before this right? There's both those guys have have large you know like Instagrams or YouTubes or whatever. Um, and then there's slightly more complex funnels. They're targeting a whole bunch of stuff, right? With local, you really just need to go lead genen, call them up, send them a video, meet them in person, close. Like, that's that's basically it. Like, it's that simple. Um, and you can fill your calendar up with that stuff. Uh, and so the the the pitch is basically uh you need fitness, nutrition, accountability. I'm sure you're familiar with with that component of it. But the reason that I'm meeting you in person is so that you can like have trust. you know that I'm like I'm in the area if you need anything. Um but we I don't want you to buy another gym membership. That's not my goal here because at the end of the day there's only, you know, three hours a week at the gym. Our time is for the other whatever the remainder hours are, right? Like that's what I'm here for because that's where you're getting fat. And that's basically the whole focus which is like I target the other whatever the number is, number of hours per week. And so we'll meet in person and then then you can basically check with them two times, three times throughout the throughout the you know the 16 weeks and then just use the inerson sale to sell the renewal. >> So you're saying like do a gym >> easiest highest likelihood like because it takes no like it takes you don't have to have very good creative you don't have to any have any complex funnels. It's like you generate leads you send them a video they show up in person and then you sell the big ticket thing. That's it. So you're just like when you say that like I'm like I'm just running ads locally to have them basically have a conversation like you're interested in basically getting back in shape and let me tell you how. >> Yeah. You can call them on the phone set them and then meet with them in person. So basically you have a set video close. >> Okay. And when you say so you when the part that I'm trying to understand is the local gym for office parts like do I need to be part of a gym? No, you don't need to be a part of it. It's just basically just having a place to meet in person in a coffee shop is is a little weirder than uh than just having an office that you know like a space that you can go to. >> But like again, I can't teach all the things that that you need to go national right now and you're like I have to get to 600K. >> Like you can do that with almost with very little. like you just need to you already know how to sell and so getting leads to trust you local is much easier and so it's just schedule I'll meet you at this place you send them a video beforehand and then when you when they walk in the door floor to ceiling testimonials so >> okay and then the last question then that would be when it comes to running ads there's so many ways you can do it between like VSSL statics with like right videos like what would you say is like the best way to go because I always try to there is No best way. I mean, the best way is the ad that converts. And so, there are statics that are converted. Like right now, we're running a ton of statics. We're also running to a bunch of video. Um, again, I'm trying to meet you where you're at right now rather than say like, okay, this is how we get to 10 million a year. This is not how we get to 10. Um, but there's like no there's almost no moving parts in this thing. Like the level of creative that you need to have to beat at a legal at a local level is much easier. Um, what what what area do you live in? >> Uh, the Chicagoland area. The area. You've got but you've got you've got people there. I mean so that's it's a decent sized city. So if you drop a pin on the map you'll have um good you'll have like you'll be okay. Okay. Yeah. Cuz if some if you're like in in in Bum wherever then that that I might have actually had to recamp my my my opinion. >> No. Yeah. It's legit. Yeah. All right. Well this changes absolutely everything that I've been building for the last six months. So I just >> before we light everything on fire that that's half for the audience too. Um if I if I like had to uh do it. And that's and to be fair like I say that because that's whenever I like had to make money in my life when I had none I always did this. It's just because local is the fastest speed to money and you have the highest rorowaz locally. The issue with local is that it's very it's more difficult to scale right. Um but in terms of return on ad spend like it's it's much more common to get 10 20 30x returns on local than you are in other markets. Um because you don't have to compete against other players and like that's the advantage. >> Okay. So before we go light everything on fire, okay, let's just let's we'll take two breaths. All right. So right now you currently are doing what? >> I'm currently running only national ads as direct offers through an Instagram DM funnel. >> Okay. >> That has gotten me this month is my best month. I spent 6K on ads. >> Okay. [clears throat] >> I'm at 7750 CAC. Um and I closed eight clients. So like I've generated 25 front end from that >> on six on sixk and ads. Okay. Got it. >> Yeah. So like a 4x roz. So when I talked with Ed Turney, I'm in I'm in the VIP advantage. He's like, "Dude, light light that up. Like make things happen and go all in on that." >> Yeah. >> And so my initial thing was going to be here being like, "Hey, >> was was that the acquisition strategy?" I'm like, "Okay, he said light this up. I'm running statics to IGDM, but I'm like, do I do that?" >> Dude, if you're running webinar funnel, >> no, dude. If you're running 4x, then just spend I mean, just double just double what you're willing to spend. I mean, then you're you're probably be fine. You're not going to run out of people. You're in weight loss, dude. I mean like you're you can run you can run that and the like the next thing you train is you're gonna need somebody else to do DM sets for you. >> Yeah. And you're okay with the IGDM funnel instead of trying a different one. >> Yeah. Yeah. It's fine. Um I I say that like I took what you said of like I have to like that is what I would do because I appreciate that. >> But you already have a 4x funnel and you're spending 6K. It's like let's just spend like 12 or 15. Um so yeah, we're not going to light everything on fire. Uh, >> no. We're going to do both though because my clients want my clients want an in-person place. They want a hybrid. Actually, people want a hybrid small gym that they can go to. We're there's stuff I can run with there. You basically So, I appreciate that. I don't want to take more time, but this is helpful. Thank you. >> Okay. Hold on. I want to make sure that we don't we don't we don't Let's Let's Let's slow down for a second. >> All right. >> You're selling You're running ads nationally, but people are not coming to you in Chicago, correct? Like, you're selling people in Missouri as much as >> I'm selling people all over. So, initially I only did local. Word of mouth was huge. They loved that I was local. But then again, it just it was too expensive with the way I was testing. I wasn't good at it. I got new to marketing. >> I got you. Um, you finally got something that worked. We're not going to change it. So, I don't think you do both. That's why I wanted to like catch you on this. Like, you don't do both. And, you know, put all the stuff I said into like a lock box of like really interesting Alex And so what? You have 4x rorowaz. You spent 6k. Now, you're going to take some of that, you know, excess 18K and see if next month you can spend 10 and see if you get a little bit better, improve some of the the DM stuff. You will in time need one, two, three DM setters and that can probably take you to well, for sure 100K a month. Um, but that was your goal. >> Honestly, I don't even care about it sounds stupid, but like I just want to feed the family and be a good dad trying to do here. >> That's for now and then you're going to get addicted to the game. But I I get where you're at, dude. I get where you're at. >> Yeah. All right. Ju don't over complicate this. You have a 4x or oz. We need to put more into the 4x so we have a bigger number to 4x. All right? And just don't get afraid if you had a bad if you have a bad month or something. Like you got to stay aggressive on it. >> Okay. Okay. Everything else I said will apply to somebody else who was listening for you. Just spend more money on the ads that we're actually working on. >> Thanks, Al. Appreciate it. >> Cool. >> Tyler, >> what's what's going on, dude? What's wrong? >> I'm looking into getting weight loss for moms. >> Are you serious? Do we do I was like I was like Jesus Christ, dude. [laughter] I do another weight loss business. I'm going to >> No, dude. Uh um so I sell uh acquisition systems, predominantly the IGM IGDM funnel to content creator. >> I literally just saw the thing behind you. Jesus. All right. [laughter] >> That's from uh Sio Kyle. >> Hey Kyle Kyle Kyle. Yeah. All right. Um, so I sell I sell acquisition systems, but mostly the IGDM funnel to content creators that have strong organic followings but struggle to monetize their high ticket offer. The problem that I have is getting clients consistently amazing results. And so the activation point I've deemed is if they hit a record month in their business with cash, they seem to stay forever. If they don't, then it's basically like three, four, five months depending how well I can navigate the um >> yeah, >> the relationship. But that's the problem we're running into. I keep trying to raise price. I keep closing and it's just more pain. So >> yeah. Um it sounds like you just need to nail the first 30 days. >> So basically there's two two components. One is uh who they are and the second is what they did. And so if we have a specific type of avatar that consistently does better and those people do a set of set of things, then it's like how do we get only those people to only do those things so that we can get as many of those people as like fundamentally gym much of the same concept, right? Which is um our average cash collected for the first two years I think was was $30,000 the first 30 days using our stuff. And then I think over time because uh CAC went up just from ads and whatnot. I think like as of right now, I think it's something between it's like 15 or 16K uh in the first 30 days. Um but for us, we just knew if we got somebody to close a high ticket sale in the first seven days that like that was the emotional shift as they go from selling, you know, $500 things or $100 things to sell $2,000 thing, it's like holy you know? It's like their whole their whole paradigm changed. Um and so for you, it's probably similar to that. And so the the churn bucket, it's like something that's just helpful in terms of thinking about churn is like churn feels like this big amorphous monster, but it's much more how do I get them to six months. Like churn after six months of all across all memberships is 2% per month. The issue is people look at blended churn between all different cohorts and so they barely get anyone to the six-month mark. But people past month six, they churn at a very very low rate. So it's really not how do I cut churn in half, it's how do I get into six months. It's just a much easier frame to to think through. And so that means that the first six months needs to be very very curated. And the three drop off points are day 30, day 90, and then at six months. Those are the three points that you have to like drag someone through. Um, and so do you give them the offer to make? >> So, so there's two primary people that I work with. The first is that they're brand new into high ticket sales and they they have a very vague offer them. Yes. The second is like fitness coaches is a great example where they they already have an offer. They already have a lot of stuff and I just run it for them better. I tend to get better longer lasting results and and like better clients from the first, but they're technically smaller and I have to do more for them. >> Basically, we want as much of this to be as turnkey as possible so that there's just fewer variables for them to mess up. So the the first group where it's like for example I have a client that had basically he's done like 300k over the first six months and prior to that he did like none and uh he was able to sell like I get him people on his calendar and he can close them and he just keeps increasing price but if they can't sell then it's like >> matter how many people then maybe one of the requirements for working with you is that they have sold someone for >> does it matter the ticket price if they're typically like >> I mean if they've gotten something if they've gotten someone to give them money I mean it probably just be over the phone I'm guessing so that would probably be the requirement again it's like I want to find the simplest thing that that separates the winners from the losers >> and then you just re-engineer the funnel to say that up front like you have to have these three things Okay. >> You must be >> and so then forgo forego the people that can pay in full and like technically a bigger clients are not as good. >> Not as good because they don't make as much money. >> Um the bar is higher to keep them around longer. A lot of a lot of the people that have done DM funnels in the past, they're like, "Dude, two years ago I did 80k in a single month." >> Yeah. >> If you don't do that, I'm not working with you. Versus Well, I think I've never sold. >> Yeah, it's an expectation thing, though. It's just like, yeah, two years ago and then what have you done last month and the month before that and the month before that? Okay, great. So, let's set let's set appropriate expectations here because like no one cares what you used to bench. >> Mhm. Okay. >> But the question is what's the limiter of the business? Um, the limiter is the pickier I get, the harder it is to get customers in the door. >> I mean, that's how >> less picky I am, the the less they stay. >> Mhm. >> So, right now, right now, customer acquisition is we partner with like companies that teach people how to do DM setting foreign like uh Eastern Europe and things like that. And we have them coming in and do cold outbound for me. So, we're sending 3500 4,000 messages a week to ICP and then they go through a funnel, show up on my calendar. >> Mhm. >> But if they're too big, they're either already going to have a setter or they're uh yeah, just not not even going to see messages via cold outbound. >> Yeah. >> I mean, what stops you from doing 8,000 Yeah, we're we're slowly growing that. Slowly is a is the wrong word. We're we're actively pushing that really hard. Getting to >> I mean, you either sell more units or you make them worth more, right? That's the like that's the game. You sell more units, you make them worth more. Like those are the two levers that you have. And so, >> if we're not changing pricing anytime soon, then we have to sell more units. Like the 4,000 DMs that are getting sent is a relatively arbitrary number in my mind. You could have said 100, you could have said 100,000. Like just same same. >> You're not going to run out of people though. I promise you that. >> Okay. >> So, yeah, I think you could get more aggressive on that side. As long as they have a scalable solution on that side, there's like really nothing that stops them, which is why I'm a big fan of outbound in general because it scales linearly. >> Okay. So, get more cold outbound. And then the second piece is uh set better expectations with people that have already done well in the past. And the last piece is uh make it more turnkey >> on the offer. >> Yeah. And I would probably ask more questions on the application around their their experience selling >> I see. Okay. >> And then you can set expectations which you've never sold. Dude, it's probably going to take you a month to learn how to sell and we're just going to It's okay though cuz it's >> Oh, no. I I >> Yeah. >> Oh, you mean them selling? I was like, "Dude, I've sold." >> No, I know. I'm saying, "But them." >> Right. So, you have to just You have to set the expectation. >> Like, people only leave when the expectations don't match reality. The goal is, and this is the this is the push and pull of selling, which is you promise really high, then you get more closes, but people back out because you promise really high, right? Um the perfect world is that they everybody just buys, but then they don't buy at the price you want because you promise nothing. And so this is the the the delicate balance, if you will. >> I see. I understand. Thank you. >> Yeah, you bet, man. >> I appreciate you. >> Mutual. All right, Alex. Hi, Alex. It's a pleasure to meet you. >> Hard to lose with a name like that. It's >> a great name. Um, I own a real estate transaction coordination business. So, we provide admin support to realtors. They only pay us when they actually have a closing. >> Okay. >> So, we did a million in revenue last year and then we had 250,000 gross profit and I want to get to >> gross profit >> in before taxes. So, >> you mean net profit? >> Net profit. Thank you. I'm still learning. >> No, you're good. It's like before tax. No, that's that's net. All right, cool. >> Cool. Yeah. Um, so 250 before taxes and everything. Um, I'd like to get to 4 million because I'd like to be at 1 million. >> Cool. >> Yep. The problem is, um, every sale in the business comes back to me. So, me going out to events, meeting realtors, everything. And so, I'm not sure how to continue to scale when there's just one of me. I don't think it makes sense to bring on like an SDR or anyone to actually replace me in sales for a while. Um 70% of the business is because of me going out building relationships. About 20% of my new business comes from organic social and 10% is miscellaneous other sources. >> How do I scale? >> Well, we need more of something. >> Yeah. >> And you're at the point where are you local? You're local, right? >> Yes. >> Yeah. So local is the only exception I have to the single channel concept that I have. Um because there's only so many pe that you are relative not not super constrained but you're relatively constrained by the size of the market that you're in. Right. Um what area you live in? >> I'm in the Twin Cities but we also do Wisconsin. Okay. >> I'm open to expanding as well. >> You know well is is the service remote? >> Yeah 100%. Hm. H. Well, that's interesting. Are there laws that are different between the different states in terms of the filings and whatnot? >> There are. >> So, but they're all pretty much the same, but there are some small differences. >> The thing is is um I don't know if you heard earlier what when I was mentioning about the local weight loss stuff. Um running local ads is like really easy. >> Okay. Um, I don't think you'd have that much trouble running local ads or even just like statewide ads. When I say local, right, it's like Minnesota realtors, we centralize, we do all the like literally just state the offer because I I haven't actually heard of that many people who do what you do and like I see real estate companies like all the time. Um, and obviously Sherro's my partner, so like I'm tangentially touching that world all the time. Um, I think like if you wanted to get from one to four, you would either have to be significantly more violent on your basically you would have to do nothing but go get business. >> Um, but what you're what you're lacking is a point of leverage. And so getting more for what you put in. And so we'd probably want So we'd probably want your calendar to just be filled with appointments and all you do is close. And then if you did that, you probably get to four. Um, what's churn on the realtors who work with you? >> 14% annually. >> Yeah. An interesting strategy you can do is just look at the MLS and then look at the top, you know, the top people by volume. Um, and you probably have an idea of what volume customers like, you know, do best because over a certain size, they have their own team and whatever. Um, and then I would probably look at some sort of cold invite uh to them and maybe do like a a webinar uh to them. That would be like the cheapest thing you could do. And then all you have to do is just confirm them basically. Like you just blast them, right? So it's like email, f call, text, follow up um to get them to a small group uh you know, call it presentation um and then present the thing or you could do it one-on-one. But I think one to many would give you a little bit more leverage. But either way, we need leverage in this. We need leverage in your acquisition, right? So it's like you're going to post content would be a way, but you can't serve the states outside of, you know, Minnesota and Wisconsin. So it's like, all right, I don't know if I want to do content per se. We could, but like let's maybe not that. So, we could do ads or we could do outbound as our two kind of higher leverage acquisition channels that we can pick from. If you feel better with ads and we can do ads, but either one works. That's kind of my point. >> Yeah. So, it's just pick the one that you feel most comfortable with. Roll forward with it. See the results. If that doesn't work, then pivot to the other one. >> Yeah. Local ads aren't that tough. They're they're they're because the targeting is already taken care of, right? So, you have the geo targeting and then you put the call out in terms of who you're looking for and it's like it's pretty straightforward. Minnesota realtors like it it it's pretty pretty obvious. And so if you wanted to what would I do? I'd probably run it by city. So I'd probably run call it like instead of running the state, I would probably run Twin Cities is number one. I would have I don't know what the other cities in Minnesota are, but like >> just one just Yeah. What? Yeah. whatever the other cities are, I would run I'd run called 50 milei radius ads uh from there because then it'll appear hyper local and if you are there then you might meet them first if you need to close. Um what's your sales velocity right now in terms of number of uh new customers? >> So I signed 73 new customers last year out of 87 appointments. >> Yeah. >> Got it. Okay. So the close rate's fine. Um I mean it is contingency based so that's that's nice. You just don't want people who aren't doing any volume because that's just a pain in the ass. >> Exactly. >> Right. And so I would just say like realtors who sold over four homes last year. >> Okay. Just being specific. >> Yeah. >> Um what would you recommend spend-wise? Um right now I only spent like 8,000 last year for all of marketing and events. I've never spent a dollar in ads. Yeah. >> Where would you start if you were me? >> Uh we have to look at LTV, right? So what do you make per customer per year? >> Um there's a big big gap. So our average is 1,600 a year but like my top 24 clients was 22,000 on average. >> Yeah. So what we have to do is make sure that the requirements are towards the top end. So when you put the call outs, it's like you have to be clear, you know, uh have to be realtor, have to be, you know, doing at least four or you could say the production volume, whatever. Either way, if you're doing over, uh I mean, probably a million, I don't know, in production is probably what you need as as the true minimum. You can make it five. I mean, it's kind of up to you. Um >> Okay. >> I would start higher and then if you don't lower it, rather than starting lower. >> Yeah. >> Because you might be surprised. you might be surprised. So maybe start at five million or 10 million in production. Um and then the nice thing is that you're local. So like you could probably just run it straight to a video and auler and then just call them as soon as they book and you can still follow up with all the other leads anyways. >> Uh in terms of spend it's it's always directly related to lifetime profit. And so you should if they're doing call it over a million in production that's probably like two or three houses. Uh so that means that as soon as they get their first sale you should be able to like I would target trying to get paid back within six months or less. It's just the nature of the business you're in. The only other consideration I have what's the gross profit? >> So we had 250,000 profit before taxes and expenses and then I had >> before taxes and expenses. What's that mean? >> So, um, snowy day fund. So, seasonality here in Minnesota, you're going to love this. >> Um, I have to stash away cash to pay my team in quarter one because they're all W2 employees in order to get us to the busy season. >> Okay. >> Yeah. >> Got it. >> So, net was or like after saving up for the snowy day fund, it was 40,000 cash remaining. >> Yeah. You're thin right now. >> Mhm. I just raised prices. >> Yeah, I don't like >> Yeah, >> there's some risk, right? And so outbound is cheaper. Outbound is cheaper. >> Okay. >> And so that might be where I would start. >> Okay. >> I'd probably start with outbound. So basically, cold call, cold email, text, uh those realtors. Um, that's probably the angle that I would go with because I just don't want you to I don't want you to risk the nest egg that you have right now, I do think you should probably raise prices and I would look hard at costs because I'm I'm betting you're underpriced >> because if you're contingency based, if you're contingency based and you're running 25% margins like you're taking a lot of risk on as a business owner assets. >> We we are I'm the highest in the market right now and I do intend on continuing to raise up. It's I'm looking at the offer. I'm coming out to one of the offers workshops. >> Yeah. >> Yeah. just to see how do we differentiate because right now it is it's a total red ocean. We all offer the same thing. It's commoditized and yet >> like I'm still getting people my my signing rate's still great. >> I would just I would go outbound. I would probably start with outbound because it's it'll be cheaper for you. >> You have more more reps of iteration before like wanting to spend on ads because you will lose that money 100% for a minute before you figure it out. >> All right. >> Thanks, Alex. Appreciate you. All right, Ali, you're the you're the uh I think the last the last of the Brohikans. >> How are you, Mr. Alexis? My name is Ali. How's how's your Monday? [laughter] >> Good. >> Good for Monday. >> What's cooking? >> Um so my question is about strategy. >> All right. >> I first So I was a regular employee. I took over, managed the restaurant and um in about a year I doubled that restaurant and we had a very good profit sharing deal. Great. >> So thankfully you know um >> what did you do to double it? You run ads or what? >> Uh no just ran the basics actually. >> Okay. >> Like very simple fixed fixed prices mainly actually increased prices. Took your advice on that but uh fixed prices fixed the you know cost inside improved recipes just the basics. I didn't do anything crazy actually. No, nothing about ads actually with restaurants. The restaurant is old. So, it's doing fine. >> Yeah. >> Um, so now I'm actually operating three restaurants with um >> with those. So, I have two coowners >> and um >> so I'm on a profit sharing deal and a management deal with >> in two of the main restaurants and then there's a third one that I own a little bit of not a little bit like a substantial amount of equity in it like more than a third. >> Okay. >> Um doing well. things are moving forward, but I don't see those concepts scaling and I'm kind of tied down as to what I should do in the future. I spoke with Ed, he suggested I go all in on a fourth location all by myself so I can retain all the equity. >> Yeah. >> Um it's pretty tough because um good income right now. >> Mhm. >> Uh so I don't want to kill all the cash coming in as I >> What do you want? What do you want? >> Um, I want to build a very a big restaurant chain. Um, built around a healthy concept, but still very good food. Maybe a billion dollar enterprise value. >> Fast casual and maybe a billion dollar. Just go. Toss out a >> We call that a casual Billy, Savvante. Um, okay. All right. So, fast casual is what you're you're focused on. I'm I'm in past schedule. We do we do potatoes, we do burgers, we do fish, we do chicken. I I know a little like I know a fair bit about those. >> Yeah, you're you're going to want to you're basically going to need to enter the franchise world. Not have to. Um that's not true. You don't have to enter the franchise world. I don't want to say that. >> But the key to those models is huge simplicity >> and nailing the very limited things that you have on the menu. Like I think the absolute like I don't know. Have you studied Chick-fil-A? >> Oh yeah. Yes. Definitely. >> Have you studied raising canes? >> Sure thing. Yeah. >> Like those >> 12 12 item menu. I was actually watching your video about this a couple days ago. Yes. >> 12 item menu. Yeah. [laughter] >> Yeah. Like those guys need to become your your you know your restaurant heroes. Like you need to just only consume the stuff that they put out. But it's all about radical simplicity. Um, >> you can absolutely become a billionaire in the restaurant space. There are there are there are people who have done that. Um, and in the fast casual space there are um >> just after 45 years. >> Yeah, it's going to take time, dude. I mean, like, you know, sorry it's not going to be a six-year billion dollar exit, man. You know, there's only, you know, there's only 3,000 billionaires on Earth out of eight eight billion, so you know, whatever. Um, I think the advice that I gave is is sound. What it comes down to is you need to you need to nail the model. >> Okay? >> Like you've learned from these three stores, you've learned from these other people, you have to have a unique model that is as simple as humanly possible, which is what like you have to build you have to build it day one for scale. >> Okay. So, that's actually what I'm working on. I'm I've acquired a fourth location. Now I'm also in trouble in in like trying to figure out what what to do with my co-owners in the other three places because they do take a little bit of my time and you know I own no equity in two of them. >> Yeah. >> Good you know good profit sharing deal but no >> do you have the I mean you will the goal will be to fire them as fast as you can. >> Okay. Okay. >> So you can focus. >> Okay. >> Because you're not going to side hustle your way to a billion dollar company. >> It's Yeah. It's tough. I mean, I'm I'm already trying just for this week. >> Yeah. >> I mean, very little sleep. [laughter] >> Yeah. You're Yeah. I mean, you can't It's like It's not a thing, right? And so, um, I think the fourth location is fine. Build it as well as you possibly can. Try to nail the model. Once you nail the model, we'll probably have another conversation, which is just, are we going to scale this privately or are you going to franchise it? Franchising works better for food businesses because they literally are recipes and you can you can standardize the outcome much more easily than you can with like a service business, which is why service businesses are hard. Plenty of people do franchise them, but they're just much harder to franchise um because you have to sell basically arbitrage on labor. So yeah, I think as like as soon as you can, I would go all in on the fourth location. Make it your main thing. >> So quick followup. So, I'm going to focus on the fourth location whenever the as soon as I can. Um, my time I was getting, you know, a good return on my on my time and then I'm going to have those, let's say, 70 hours a week to focus on the fourth location. What's the best way to spend those 70 hours? I'm not going to be, you know, as little operationally, of course, more building. But >> in the fourth, >> yes, I'm going to be there, of course. But, you know, >> yeah, I would I would for sure be there. >> I'm [laughter] going to be there. >> Like, I mean, you need to you need to understand where every fry goes. You know what I mean? Like it has to be like you need to know that thing like the back of your hand so that you can really make sure the like that you don't have a single square foot extra that you don't need like what we're what you're going to be building towards is return on invested capital. That is going to be the metric that you'll need to optimize around and payback period. So just like you have a payback period for a customer when you chunk up a level to the business side it's pay it's payback period per location. And so if you spend $100,000, I'm making simple math. $100,000 to open a location. If you can get that $100,000 back in three months, then it's like great, I can open another location, right? And so if it takes you three years to get it back, it's going to be very hard to scale this thing, right? Which is why you need to really really aggressively control costs um on the buildout, but also on the day-to-day in terms of like how few people can I use to make this run. Um, and I'm telling you, you got to study the h like raising canes right now, like he's he's the best in the game right now in my opinion. >> Yes. >> Like just everything that he puts out, which is so little, which is a pain, but everything he puts out, that would be the guy. >> We're doing beef tallow chicken actually very close. So >> yeah, just I mean as simple as possible, as few ingredients as you can, smallest, you know, footprint. You going to do a drive-thru? Yes. Yes, we do have it. Yeah, that's gonna be good. >> All right. And then it's going to come down to location picking and then like No. And then crushing the grand opening. >> Sure thing. >> That's the big thing. >> Actually don't know much about that. I'm sorry. >> You need to So brick and mortar comes down to return on invested capital. Like I just said, you need to have a a career path structure so that you can have some sort of call it pseudo ownership of each individual location. So you have somebody who feels like an owner who's worked there like Chick-fil-A has mastered this. Um, and you need to have a banger grand opening strategy. Like these are the things that are required in order to make uh brickandmortar work at scale because remember I said that payback period thing. >> Yes. >> If you bet if you crush the grand opening, you can pull forward the payback period so you can start opening the next ones. >> Makes total sense. Cool. And >> I'll I'll give you one more thing, which is just that once you do the grand openings, >> we should be able to sustain the store off of word of mouth because food the margins are so low. There's obviously little things we can do, but like the margins are low enough that >> we should we should be good enough. The chicken should be good enough that people eat the chicken, want to come back, tell their friends about it. So it's like we want to spend the marketing upfront so that we basically have enough people try the food and tell their friends that the people who churn out are equal to the amount of people who come for the first time and then it stays at that capacity and then it keeps them printing money. >> Makes total sense. Yeah. >> Appreciate you. >> Thank you. Thank you, Alex. We appreciate you. >> All right. Appreci All right. Let's go. So, is that fun? That was my first of my uh the first of our of our 30-day countdown of uh answering as many questions I possibly can. Do a Guinness World Record of of question answering. We had a lot of weight loss today. Okay, so let's see here. I think I think that was good for day one. How'd you guys like it? Let me look at Let me look at the chat real quick. Um anyone in the comments who's a millionaire? Yeah, there's probably people in the comments, Josh. Um, there's a lot of business owners that follow my stuff. Uh, by the way, it's funny because like I guess millionaire versus million-dollar business owners. That's a good delineation. You help companies how to build real estate system. That is a bit that is a bit open-ended. Uh, wow. All right. Wish there were more breaks between people. Yeah. You know what? That's something that we could probably do on our side. That's a good piece of feedback. Um, what Kane did you say was the best? Raising Canes is the is the guy who's really really good. He's unbelievable. He's a decillionaire now. Owns every location outright. Really impressive. Uh, love the format. Okay, cool. Uh, not even trying to run a business. [laughter] Okay. You sell a chatbot. How do you scale? Um, use the chatbot to sell more people. Uh, scaling clothing brand suggestions. Partner with a gigantic influencer who has a good brand. Um, how can I stay start being more disciplined? Um, just start. Uh, do you think drop shipping is a good business model? No. But I think it's a good way to get started and learn how to do stuff and make some money. Typically doesn't scale. Um, all right. Now we got a lot more lot more lot more puntas in the chat. What do you do if you don't know what to do? You build capacity. You sleep well. You get in shape. You save your money. You build capacity so when the opportunity does come, you can go all in. How do you build a soap production facility? Man, I I would never if you're like what questions am I going to get if I had to like answer if I put the first hundred building a soap production facility would not have been on my hundred list. How do you scale house flipping? Really good question. Um the people who I have seen who do well there um basically become marketing companies uh nationally for flippers as in they do lead genen and sometimes get percentages of deals. Uh, how do you scale an online school quickly ads and have a good product? When do you know you should hire a worker? When you can afford this is actually a really good question. I'll answer this question because I think it's I I'll take this will be my my my meteor question for from the chat. So, when do you hire your first employee? There's you either have to borrow the money from the future or you have to use cash flow from today to get to be able to afford that employee, right? And so then the next question is with the time that this new employee affords you, are you able to generate more and ideally four or five times what that employee has is covering for you? Right? And so let's say I've got a business that does $200,000 topline, uh, you know, $100,000 in profit. If I, if I hire somebody and let's say it's a, you know, call it a minimum wage or minimum wage plus, it's like maybe it's $30,000 a year. Uh, so I have 70 left. If that 30 can give me half my time back, right? Then it's like maybe I can get another $100,000 on top of it. So I'm still getting a return on that time, right? And so the idea is it's a continuous play of arbitrage as an entrepreneur to trade the lowest things on your calendar that are taking your time for the highest value things on your calendar that make you the most money. And that trade just literally never ends. And in the beginning of a business, it's almost entirely promotion driven. Meaning you have to let people know about your stuff and you have to get them to give you money. Once you have that, then over the long term, it's about how good the product is. And so, it's kind of interesting because the things that it takes to help you start often is marketing and sales because if no one knows about your stuff, you're not going to make any money. And if you can't get them to give you the money, you're also not going to make any money. But it will be difficult to scale because you're always going to have to find new people rather than have the people that you found originally keep wanting to pay you. And so, John Paul Deorio said this really great quote that I like. He said, "You want to be in the resell business, not the sell business, right? Which is that you don't want to always have to get new customers." And this is again one of the the pros and cons of educational businesses is that they are higher margin because the value of education is super super high and it's an intangible thing, right? And so you can charge a lot for it because people want those skills and people can't lose those skills once you have them. So that is why education is valuable and I'm only bringing this up because we had a bunch of education business today. The downside is that once someone learns it, there's very little value that additional education confers unless it's something different or something better that you're educating them on, right? And so you ideally want to build businesses that have consumable value, meaning it's value that they need every single if you're trash removal, like they still need their trash removed to tomorrow. If you're cleaning, they still need cleaning tomorrow. If you're making, you know, editing videos like Darina earlier, it's like they still need more videos edited. So there's consumable value there. And that's and that is what a recurring service uh is structured as. Now, where it gets more difficult is that in a recurring service for stuff that people already do, then it can be a commodity because other people also do that recurring service. And so then it goes into the other variables of value which is how can I establish that I am better at it in a meaningful way which comes down to tracking the data of your customers so you can demonstrate that compared to your competition. How can I do it faster from the time that they buy to the time that they get and then faster from the time that they get to the time that they ultimately get the outcome that they're looking for. And then from an ease perspective like what are the things that my competitors are forcing them to do that they don't want to do uh that I can remove from them and to like right now is very ripe for even knowledge service businesses uh because people are like don't start a a a a knowledgebased business because of AI sure uh but there is also a window of time right now and you got to make money so it's not like oh well just not try at all right it's like start and you can use the money and use AI to make more money because there's this I there's this fallacy of a perfectly informed market that everyone knows everything and prices are perfect which is not reality and so there are plenty of people who are not techy who again you don't need to you don't need to tell anyone you're using AI you just need to do the service and use AI and do it more competitively than people who are not using it which are the older more entrenched players in the space whatever space you're getting into and so this question originally started with how do I know who to hire but it just comes down to we have to trade the least valuable time that we have for the most valuable time and as long as we can make a good margin on the time that we're trading, it is worth it. Now, the difficulty when we hire somebody new, especially when it's your first hire, is that you're going to have to train them well. And so, what I would encourage you to do is you have I'll call it two schools of thought. The more advanced you are as a business owner, typically the more you'll hire higher high up first and then lower later. But the reason that that is something that a more advanced business owner will do is typically because they're not starting from true scratch, right? And I say this to somebody who started from true scratch and started with low skilled labor as the first hires because it was all I could afford. But when you see sometimes these uh you know investor-backed companies, they can get three, four, five, six people in the quote the founding team who are all studs and as a result the overall culture and caliber of the talent that that team can attract is much higher. But the debt that you incur as the entrepreneur is that you either give up equity to the investor or equity to the co-founders. Uh and that is permanent and you have to make a very good judgment call and oftentimes you get it wrong. Right? And so this I mean if you're like man all these paths sound difficult. It's like that's just reality. And the reason that you get compensated above normal is because you take above normal risk. And and this is a big one that I think a lot of people in the world don't understand is that once a business works what people do not see is the four businesses you had beforehand who did not work. that you learn the lessons from. And so if your business isn't working as well as you as you wanted to, I would use what I started today with, which is do I need to apply sandpaper, which is it am I just rounding out the edges because things are going okay and I need them to go better, or is this completely averse from the goals that I have and there's no way that I can see that I'm going to get to where I want to go and I must change the way I do business. And so I think both of those are decisions that you have to make at different points in your career. Um, and call it wisdom if you want. Um, is knowing the difference. And so with that, I appreciate you all. Love you. Mean it. I'll see you guys tomorrow. Tomorrow. >> We're doing one tomorrow. All right. Rock and roll. Let's slay. Be easy. All right. Bye.