Episode 377: The 3.3 Rule With John Briggs

Welcome to another episode of the Above the Business podcast. My name is Bradley Hamner, your host. Today's episode, we have John Briggs. He is on to talk about his new book, The 3.3 Rule: A New Workday Normal. We get to that on the back half of the podcast. But if you've ever struggled with your financials and understanding how to utilize them, etc., John is a CPA and I'm telling you, we go into some really great stories and we kind of go high level to eye level, some things that you can really take away in your business to be able to help you to make better decisions regarding your financials. And then on the back half, we get to his book. I think you're going to really enjoy this episode that I did with John Briggs. John Briggs, welcome to the Above the Business podcast.

Thank you.

Excited to have you. So we always start with background and origin story. Uh, I love hearing about how people got to, to where they are. So why don't you take our listeners back on, on your journey?

Okay. Um, probably the most pivotal part of my journey, I have to go back to, um, I was living in Argentina doing a service, uh, doing some service for my church. And at that time they have like a guy in charge of all of us who volunteered. And I asked him, he was pretty successful guy, said, what do you think I should do? Because I had gone to school, I'd started school and I was a computer science major because I wanted to play video games for a living. Apparently I was a decade ahead of my time because at that time no one got paid to do that. And, like, none of my teachers assigned video game playing as homework. I don't think this is for me. So he suggested anything with business, like business degree, maybe become an attorney. And it just happens that both those routes took me through an accounting program. It's the first time in my life that a subject clicked. That's how my mind works. I'm a weirdo. I just— debits and credits. I got it. It felt so logical. It felt so practical. Where while I was a good student, I had to work at everything, where accounting to me just came supernatural. And so that kind of put me on this path for accounting. Got a master's degree in tax, worked at Deloitte, worked at some small businesses, saw a lot of stuff I didn't like. I'm also a little wired to see the problems because I want to solve problems as opposed to being the guy who's like, hey, let's pause and look how good we're doing. I don't need that in my life. Nothing wrong with those who do need it. It's just not how I'm wired. And so seeing all these problems with these other firms that I worked with, I'm like, I, I really want to change the industry. I think we can— I can build a better mousetrap for accountants, if you will, and have a better firm and a better work-life harmony. And so that kind of led me to where I am today. Started off in a windowless office by myself, and now we have 210+ team members. Across the country, you know, tens of thousands of returns done every year. Um, so that, that's a bit of an origin for me.

That's great. Well, clearly you, you're, our, our brains work differently because I went to, I struggled in my accounting classes when I was at Auburn. I got my degree in finance and I've told this story on the podcast before. You wouldn't have heard it, but I've shared this with my audience. I was in my, I had just finished my second year of business and had my first profitable year. And my CPA says, Bradley, congratulations. You, you made $32,000 in profit. And my answer was, or reply back to him was, that's awesome. Where's that money? And I was dead serious. I was dead serious. I was like, is there a pile of cash somewhere? Cause I need it. And he said, what, what are you talking about? No, no, you spent that. And I said, what? How did I spend this? I have $100 in my bank account. Like, I don't understand. Like, I do not get this. And I started asking questions around different things. And, and, and so I'm leading to a question here, right? Because I was really embarrassed to share that for a long time. But over time, in talking to entrepreneurs and small business owners, unless they have your experience, I've come to find out, like, oh, actually a lot of people struggle. A lot of business owners struggle with this and this understanding of, uh, P&Ls and balance sheets and cash flow. Oh, and wait a minute, profit's not cash, but, but what, what, wait, it, it is, but it isn't, but it's not. And all these kind of things. What have you seen yourself with small business owners and some of the typical struggles that they have and in understanding and interpreting financial statements?

Yeah, I mean, the first one is the fear. It seems complicated if you didn't study it. And most people don't go into business to want to do the accounting. They're excited about whatever it is they want to go into business for— sharing a message, creating a product, doing a service. And I, I feel like because of taxes, a lot of business owners feel like the accounting is a necessary evil. To do their tax return instead of looking at it as here's a resource that I can use that actually gives me some information that I can make informed decisions relying on these facts of what has happened so far in my business. So because of that, they typically push it off. And when I say push it off, I'm talking about like once a year. You know, they— oh, even if they make a New Year's resolution, I'm, I'm going to be on top of my accounting this year, all the other— literally all the other things in the business that are always going to be more exciting to them will take precedent. Like, oh, I should really sit down. I have this schedule to look at my financials, but I got this fire that kind of needs to be put out. I'm going to go ahead and do that. And I get it. I get it. There's probably elements if I sat down and looked at it that aren't accounting related, that's like, I don't really like doing phone calls, actually. I don't love making phone calls. And so I will try to find reasons to put that off. It's similar to a business owner with accounting. And so it's, it's a struggle. And, you know, before we started recording, we were talking about a person we both know, Ryan Dice. I was actually listening to one of him and Roland. They have a podcast that I gather talking about this. Part of the challenge too is because it's so unknown, business owners don't realize that there's flexibility in the way you do the accounting. And so instead of feeling like you bring in someone to tell you how to do something in your business that you don't want to do, it can be a lot more of a collaborative relationship. And I don't, I don't think most business owners realize that. So instead, it just, it just feels like something like, I don't really want that in my life, but it's a necessary evil. So I'd like— hopefully people can get past that and realize this could be really good if you use the financials the right way. It can be really good for your business.

Do you also think too, there's even like— I'm going to give a specific example that really confuses people is, you know, accountants, they seem to use words interchangeably. Oh wait, do you want an income statement or you want a P&L? Oh, they're the same thing. You're like, wait, what? You know, like, wait, do you want my income or you want my profit? And you're like, uh, you know, it's like, and then earnings, you know, you hear earnings, it just ends up being all these things. And so it becomes confusing to them. But what was confusing for, to me for a really long time as to what things are, you think that plays a part of it? Totally.

If I look at typical accountants. I think some of them do it on purpose because they want to feel like they're smarter. They weren't willing. Most accountants aren't willing to take the risk as an entrepreneur. And there might be a little bit of this resentment. And so it's like, well, I— numbers are important and they'll learn that numbers are important. So I got to sound smart. What we constantly are training our team, like, don't sound like an accountant when you talk to clients, please. But yeah, for sure. Income statement, profit and loss, net income, taxable income, profit. Like, is it gross profit or is it profit? Because those are two different things. And then EBITDA, right? Even EBITDA, like, oh, well, I've heard EBITDA is important and some people don't even say it the right way. Well, EBITDA is just a fancy way to really say cash flow, you know, like, yeah, shareholder distribution, owner's draw. Like, wait, what, what, what's going on here? I I think they complicated it probably a little bit on purpose. And I, on behalf of accountants to everyone else, I apologize.

Yeah, I think that's great. And then you start, yeah, EBITDA, you throw EBITDA in, throw in SDE. Well, wait a minute. When do we use SDE? When do we use EBITDA? If you don't know what that is, don't worry about it. It doesn't really matter for most of you. But yeah, no, I completely agree with you. So for someone— again, this is another embarrassing but 100% the truth— that year that he said, hey Bradley, you made a profit, I was like, oh great. Um, and then he rattled all this stuff off and I said, can I book some time with you so you can like teach me? You know, I got to a point to where it's like, okay, I can't fake this anymore. And I did. And he charged me for the time, which I thought he was just going to be, you know, I should have known better, but I didn't know at the time. And then I get the bill for $600. I was like, wait a minute. I'm more confused now. He's not my accountant anymore, but like, I'm more confused now than whenever I started, but neither here nor there. I did though, was I was using Quicken. I was using Quicken. Like I wasn't even using QuickBooks.

Okay.

And he said, hey, we need to use, we need to really switch you over to QuickBooks. And I was like, what's the difference? You know, cause I was using my. Business banking like it was a check register, right? Like, and so, okay. Anyway, obviously that's been a long time ago and I've evolved and grown and learned. But I will tell you that one of the biggest things for me is I realized that all of this stuff around cash were skills that I could learn. So in other words, I used to think for a long time, John, with John the CPA, he's the expert. He has all the wisdom. He's the mighty wizard. The Wizard of Oz. So here's my question: if somebody is even remotely— and I know some of you are because I, uh, I've talked to our listeners before— if you're in that position where you're, you know, maybe not, hopefully not using Gwicken, but, um, uh, you know, just doing off an Excel spreadsheet or something like that, and they're like, I want to get my hands around my numbers. I want to start to learn. It can be really intimidating and knowing where to begin. Where should they begin?

Okay, and I would even— so obviously someone is ready for that, that's awesome. I'm hoping everyone who's like, I'm not ready for that, or I don't care, can maybe get there. Um, I— there is a minimum level of knowledge around your financials that as a business owner, you have to know. You have to know. You cannot abdicate it to your bookkeeper. And we try our hardest to help our clients explain that, uh, we— to explain that to them, because it's like, we're not going to tell you how to be profitable per se. You're asking us to do your bookkeeping. If you want consulting, we can definitely look at that, but like, you know your business better than anyone else is going to know your business. So Let's make sure you understand what we're presenting to you so you can make the decisions you need to, because that's where the best advice is going to come from. So that being said, where do you start? Oh, you want to start with a rhythm. So— and this is— you have stuff in your life that you commit to that if it shows up, you're not going to miss it. You got to start treating some sort of appointment with your financials the same way you respect those other meetings. That could— I wouldn't do once a month if you're, you know, you could probably get there, but I would say to start off at least twice a month. We have some clients that when they're starting to get in the rhythm, once a week, because the reality is once you get into it and you get the rhythm, it doesn't take as much time. But of course, the first couple times are going to feel awkward because We're all awkward at something the first time we do it. That's just natural.

Yeah.

So committing to a rhythm is super important because if not, wherever you start with doesn't matter because you're going to let every other reason, which currently is happening for most business owners, get in the way of doing your financials or looking at them or reviewing them. Second step is whatever you're using, it needs to be able to produce some sort of report. So for that reason, while Excel works really great, if you have a super tiny operation with minimal transactions, fine. Those are like side hobbies. But my— for your audience, like, they shouldn't be tracking stuff in Excel. Bite the bullet. QuickBooks is very user-friendly. It dominates the market for a reason. And you can even spend probably 2 to 3 hours with their video training videos and get a pretty darn good idea of how to navigate the software. But you need something that's producing reports for you because at the end of the day, the data entry of the transactions is just the foundation for the report. And the report is the language you want. The report is the communication you want from your business. And then from there, You could probably— there's probably thousands of videos online like, what should I be looking at with my profit and loss statement? You could probably even go to ChatGPT. I'm a business owner. What things should I be looking at on my financial statements? And get a pretty basic list that even I look at for my firm as a CPA. This trends, what's trending, what's off, what was off of expectations. Any question, you just take the time to ask the question. Yeah. Anyway, so it obviously, there's, there's a, a line of progression you get there with, but I would, to reiterate, set up the rhythm and make sure the next step would be make sure you're getting reports from however you're accounting for your stuff.

Oh yeah, that's great. I think we're kind of moving up the ladder of 101 and 201 and so on and so forth here. I, I don't know where this one would land, but and I'll let you explain what this is because you may have some different vernacular. This is kind of going back to what we said earlier, is that it can— people use words kind of interchangeably here. But I will tell you one thing that was a transformational thing for me was common sizing. There's two things, but I'll give one of common sizing. And so because I just always looked at the raw numbers and then when I started to see it in percentages. So why don't you walk people through that, that aspect of it and the viewpoint of common sizing and why it's valuable for a business owner to see it that way.

Yeah. So vernacular, not a phrase that we really use in our firm, common sizing, but I think you're talking about normalizing the numbers, right? So as an example, if I have two clients, one's half a million dollars in revenue and one's $8 million in revenue, I can look at one of their expenses, say like, wow, you spent $2 million on labor, but it's 25% where the $500,000 company spent 50% or 60%. Right.

So, yep.

And this is another one of the reasons why you want a software that can produce reports, because with clicks of a button you can click, give me these as a percentage of income.

Yeah.

And that's really what we want to do. So it's a great way to look at things because without that, you could be thrown off by a large dollar amount. But overall, it's not that big of a percentage. And so you shouldn't be that concerned with it. Not to mention when you start going up to the, you know, 301 or 401, if we're taking that level of college classes, people will start providing like, well, in this industry, here are some percentages.

Yeah.

Rarely do they say for this industry, you should be under $10,000. It's always going to be based on percentages. So What you do for that, what the software is doing is it's taking your expense line item and dividing it by your income number. Usually it's usually a percentage of income. And yeah, that helps you see the trend and helps you see kind of your financials on a pie chart level, which I know for most business owners, we do like visuals. It helps us grasp the concepts a little bit better.

No, I think that That's exactly it. Because I would ask people, how much are you spending on marketing? And what did I get? I got a number. Well, I'm spending $5,000 a month in marketing. And then I'd be like, $5,000? I'm only spending $2,500 or whatever the numbers were. And then like, how much is your payroll? You know, twice a month? Oh, your payroll is $10,000. Your payroll is $15,000. Oh my goodness. I, you know, I'm behind. When the reality was, I didn't have any perspective because I didn't have all the numbers in a percentage. And so I might have been exactly where I needed to be. And there was no way for me to to compare. I thought your numbers are great. What about $500,000 versus $1.5 million? Those are even tighter. $500,000 versus a million. I mean, those are, you know, that, that business at a million is twice as big. And so the numbers, the percentage is going to be the same. So now we can compare. Hey, we're both spending 7.5% in marketing. Okay, all right, great. Well then, you know, I'm right on pace where I, where I need to be. That, that was really transformative for me. The second one is, and wherever that where you would put this one in our college, um, masterclass that we're doing here. Okay, that's what we'll call this, Joe. Uh, but is, um, perspective. Okay, so perspective meaning, okay, so I'm looking at my numbers, and, and the reason I'm sharing this because I'm trying to go back to, to years ago when I would look at something, though I don't even know what to look at. Yeah, I'm like, all right, I got the diegum thing, it was just numbers on a page. And so Commoditizing helped. And then the other part of it, which I think kind of goes really hand in hand, and of course, as you can be on the report, but it was really helpful for me to say like, well, what was it last year? Same time last year. What was it last month? What was it supposed to be against forecast? Maybe talk about, and again, you may use a different terminology. I just think about it as different perspectives.

Yeah, no, it's great. Different perspectives, different time periods. At the end of the day, what we're talking about is comparison, though. Your number means nothing without comparing it to something else, whether that's I'm comparing it to my income to see the percentage, or I compare it to last month, or I compare it to a year ago, which, by the way, are all great periods to look at. One of my favorite charts to look at when I'm looking at my own financials and trending is a profit and loss statement broken out by month. And I want to just see the trends. Yeah, every line item. Like, why is this number going up? Why is this number going down? We made an effort here. Like, I spent $5,000 in advertising. Okay, well, that's 2% of income. That helps me. It also happens to be $4,000 more than last month. Why was it $4,000 more? Oh, that's right. I did a campaign. So if I did a campaign, Do I see an increase in revenue the following month?

Yeah.

If not, what did I get out of the $4,000? So now I can make better decisions on spending that $4,000. The different— absolutely. Prior period comparison perspective, man, super valuable because a lot of times we are going to get stuck in the day-to-day of the weeds of what we need to do as a business owner and taking pause to look back and say, hey, you know what? We actually have some gain here. I've been— feels like I've been sludging along, but wow, compared to 12 months ago, things actually are a lot better. Maybe I should feel better about myself and the efforts we've made. It's not as bad as it maybe seems like it. So, or the worst case scenario, we do have clients who come in and like, they think they're on cloud nine, things are going great. And we look at the numbers and we're like, you're trending down. This is bad. What's going on? What do you mean? What's going on? And so we share the numbers and all of a sudden it's like, oh, I got a little complacent and I took my foot off the gas. Or maybe I— that little change ended up being a bigger change than I thought. So I— man, the language of accounting is super important that we're communicating in that way with our numbers so that we can ask questions and actually see what's going on.

Yeah, I totally agree. And You know, I have an analogy that I've shared with people, not just in financials, but really also with, with just setting goals or targets in their business. But I call it 350 pounds. And the reality is, is if you owned a weight loss clinic, somebody came in, it was 350 pounds. You know, it means nothing. It means nothing. What matters is, well, what were they a year ago? Because if they were 700 and 700 pounds and they're 350 pounds today, you'd celebrate. You know, like, oh my goodness, what— that's amazing! What have you been doing? That's, that's incredible. You know, conversely, if they were 150 pounds a year ago, we'd say, hey, all right, we might need to take a look at if you had some changes in your medications and diet and all of those kind of things, right? Because it's just a number. And I was talking to somebody today, uh, this morning actually, uh, or right around lunch, and they said, uh, yeah, our target is to get to $2 million ARR. And I said, that means nothing to me. Nothing. Where are you today? You know, where do you want to be? When do you want to get to $2 million? Like in 10 years? He's like, no, no, no, I want to be there in 3 months. I'm like, oh, okay. Well, now we start to have some perspective on that. I think also to what you mentioned is so valuable for a business owner that if you have been where I was, where you, you get, let's say you go through the process and you're actually getting your financials. Okay. You're getting them. And they're sending them over in a PDF and you're looking at them and saying, I don't know what— I don't know what the hell to do with these things. Okay. And like, they mean nothing. It's because you probably don't have, like you said, the graphs and the visuals and the other things around it to give you the perspective and the insight that you need. Otherwise, it's just a bunch of random numbers on a PDF forms. No wonder you can't actually make sense of it. Is that fair to say, John?

Totally fair. And I'll go back to an example Ryan Dyson and Roland Frasier shared because it's such an extreme. They were talking about one of their businesses and they were getting reports from their accountant for years that they never looked at because it wasn't valuable to them. And they found out the report was so complicated that they had, like, there's 3 people, but 2 people full-time were just creating the graphs and things on this report that they weren't even looking at. And so it's important that you know what you want to look at. And usually with a con— one consultation with an accountant, you can probably figure that out if you don't already know already. But it's like, what's driving my business forward based on my goal? Like the guy, $2 million AR, what's driving that? Is it sales calls? Is it ads? Whatever is driving it, I want to make sure that that's showing up somewhere on this report so I can see that number and not let all the other stuff that could confuse me get in the way. So pick a few things to look at. I want to make sure I'm receiving that as the owner in a way that makes sense to me. Just because the accountant presents it to you one way doesn't mean you can't go back and say like, hey, appreciate this, but this isn't helpful to me. Can you give it to me in this way? Because at the end of the day, I am paying you for this service, and in format A doesn't benefit me, but this format B would be better. You have totally every right as the client to ask for that. You don't have to just say like, well, the accountant says this is how it's done.

No.

At the end of the day, the financials are for you, not for the accountant. They're for you as the owner to make the the best business decision possible.

Yeah. And, and I'm going to give an example because I think, um, sometimes when we, when we say business, business decisions, I want to give one specific, um, John, and maybe get your opinion of this. So this just happened last week. Now, you wouldn't obviously know the perspective, and I won't obviously share his name of the business, but he, he, he really came and he, and he was talking about It was, it was an onboarding call. And so I was asking him questions and he's at about a $2.7 million run rate right now. And so 2.7 ARR or something like that, pretty close, 2.6, 2.7. And so his whole thing was like grow, grow, grow, grow, grow, grow. And so we ran the numbers and he's running at about a 3, 3.5% net margins. I mean, he is razor thin, razor thin. And I said, I'm going to tell you for the next 12 months, Your focus does not need to be on growing top line revenue. Your focus needs to be on getting those margins to 10% minimum, minimum profitability. But realistically, we need to see what does it actually look like to get to 20% and where does that need to come? And so it's using leveraging the financials to be able to make some of those better decisions so then he can get to the right profitability number. Because I said, look, if you grow this company to let's say you double it to $5 million. Okay. With these margins, you're going to be stressed out the wazoo. Like, it'd be— you'd be better to not grow the next 12 months at all, but increase profitability, you know, fivefold from where it is today. I'm sure you have a number of examples of when you give people that insight and they go, oh my gosh, I just didn't even realize that that's actually the thing I need to focus on. Yeah.

So just as a foundational statement there, man, people need to be focused a lot more on their net income than they do the top line revenue. I, I like, I get it. But at the end of the day, I don't— I'm not in love with the Inc. 500 and what they've done with glorifying just top line revenue. Out of college, I worked for a company that did $30 million in revenue, was number 88 on the Inc. 500 list and declared bankruptcy the same year. Because of razor-thin margins. In fact, their margins were so low that was negative. Um, you, you've got to— net income's so much more important, guys. Cash is king. Um, but one example to answer the, the question you did ask: two clients, two separate clients, same industry. One had four locations and was doing like $5 million in revenue. The other guy had one location and was doing $700,000 in revenue. And if you looked at the net income, the guy at $500,000 took home like $300,000. And the guy with 4 locations took home like $850,000, a little bit more, but 3 extra locations and 3 extra teams that have to be managed. And 3, like, and so I went to him and I obviously without sharing client information, I said, hey, just so you know, We have another client in your industry who has 3 times the margins you have. So I'm telling you it's possible. Same, same thing that you just talked about, like, like you need to focus instead of worrying about opening up location number 5. Let's start dialing in each of these locations. Let's treat them separately. Let's separate your accounting separately so that we can see profitability per location and then we know it's possible, you know, what can you do to improve your actual margins? And come to find out, 2 of his 4 locations were actually killing the other 2 that were, that had those margins. And so it's like, okay, well then what's the decision? Like, so he then had to make the decision, but he now has the information and he can, without that, he was just gonna run. It's just one giant pile for him. Now with 4 separate isolated things, It's like, okay, I could choose to shut them down, but I know it's working here. So what isn't working here? So now he had options, either of which would've been fine. Shutting both the two bad locations down would have been just fine. It would've been the best business decision for his, the financial outcome of the company, or giving it time. He had the cash flow to invest in it. So now he's consciously making the decision as opposed to being haphazard about it as an owner. And he was able to figure out what were the missing factors of the two poor, low-performing versus the two better performing. And he, he turned it around. And so now it wasn't stressful for him and he had the margins of the other guy. And, you know, you know, 8-figure take-home or what, a 7-figure take-home stuff like it never would have happened if he didn't take the time to sit down with us and we could look at the numbers and break it out the way he needed to see them.

I think it's great. I think it's such a good example because you're not trying to take options away. You're trying to give the business owner options and insights to do what it is that they do best. I would argue that is, that is really working above the business to be able to say like, wow, these two, these two are the ones that are killing me. These are the two that are crushing it. If we can't get these two businesses to operate like these two businesses, we're going to shut them down because otherwise it's just not, it's just simply comes down to, it's not worth it. So I think it's a great example.

Well, yeah. And on that 100%, because he had managers in each of the locations, when you have 4 locations, he can't just work in the business. Yeah, he can't just work on the business. He had to have team that can help him with the different things. And so he was getting information from all the different managers and like working above it that he wouldn't have been able to pull it off if he wasn't working above it.

Yeah, totally. So tell me about your book, The 3.3 Rule: A New Workday Normal. Tell me a little bit about that.

Yeah, so I don't know if people are familiar, but early 1800s, we, we humans worked 100 hours a week and that was normal. And then Henry Ford came along and wanted to sell more automobiles in the early 1900s. And so he created what we now know as the work, the, the weekend and the 40-hour work week to sell more cars. And now 100 years later, we are still working in the same format, 9 to 5, 8 to 6, whatever, with breaks in between. But like, we come into work, we sit down and we take time off and we have 2 days at the end of the week. There's been a lot of science that's happened in the last 100 years and it doesn't support that. And so the 3.3 rule, simply stated, is the most efficient workday consists of working up to 3 hours at a time, followed by a 30% recovery period. Mm-hmm. Science does support that. So even if I'm really good at something and really focused, science shows that at most at the end of 3 hours, my productivity is gonna decline on that. I am now less efficient. And what do we need to become efficient is we need an actual break period. We need a rest period. The Princeton Neurological Science, the Institute of Science did a study and they show that our brains actually have a natural flow from focus, distractibility, focus, distractibility. It's a natural cycle. And when natural cycles happen in our brain, the best thing to do is to embrace them instead of trying to force ourselves to do something unnaturally. And so in this case, the 3.3 rule kind of goes into that science and says, you know what, if we intentionally take breaks, we can come back to work extra focused, like more focused than normal. Instead of just sitting down and thinking, oh, I'm going to be here for 9 hours or 8 hours or however long. And so that's kind of the gist of what the, the book covers. It talks about all the science, how to apply it. And then I go into if you do the 3.3 rule, you're already going to be more efficient. But if you're growing a business with team, how can they be even more efficient in their blocks when they're working? Like, are, what are all the components of your business that work together? And so it's kind of what I've learned over my career from growing my firm to just me to 210 plus. And it, you know, it's, I find it valuable. It was good for me to get it out to the world.

Well, I have so many questions. Okay. So I have not today at the, uh, recording this. I don't usually record on Mondays, but it worked for our schedules. Um, and so I'm definitely way over my 3 hours today of being, of being on. So hopefully my efficiency is not coming— inefficiency is not coming across on the podcast. But okay, so one of the things that, based on that, that I was doing some math on is, as you were talking, I was like, okay, I've generally worked on like a 90-minute, and I think I picked that up from Cal Newport. I think. Okay. So help me practically that if I go 90 minutes and then like I had a night, I have a 90-minute session. Okay. Okay. So then if I do that, that's a 27-minute break. I think that then the question comes is then what is the break? Does that mean? Does that— is that like a complete break? What level of break is that to actually be able to optimize effectively? Okay. Does that make sense? My question, right? Yeah.

Yeah. Cal Newport. Great. I hope someday to meet him. I love his stuff. Deep Work. He just has a new book. I wish I could remember the title. All still around efficiency. I feel like the 3.3 rule picks up where his book Leaves Off. Okay. His concept of deep work is that there's deep work and there's frenetic work or shallow work, which is frenetic. And in a small business, there are job responsibilities that are always going to be shallow frenetic work. You can't get around them.

Yep.

So this idea that we can only do deep work is impossible.

That's right.

And so the 3.3 rule allows us to have the flexibility because it's a framework. Now, that being said, to get to your question, the break is a complete break. It's not if I'm doing tax returns, I'm going to go check emails for my break. That's not a break. It needs to be something that allows you to come back, reset. And that's one of the hardest parts for business owners because we have— I think when you're a small business owner, by default, you have an element of workaholism. You're on some sort of scale whether it's extreme to a little bit. And we just, it's our business. Our task list never ends. I can't take time off. I'm just gonna switch muscles. Like instead of doing curls, my, my arms are tired. I'm gonna now start doing squats. For our mind, it's still our mind. So we have to give it a complete break. So creative things for most people, um, in, in service-based businesses, Like for our small business owner clients, creative things are great breaks. Drawing, even coloring, as childish as it seems, those are great things to do. Journaling, reorganizing your desk, getting up and walking around. My per— my personal favorite is just taking a 15-minute nap. Like it's a complete break so that you can come back knowing like I have permission to not think about work at all. And now I'm back at work. It's like, okay, I actually, I'm ready to go. Let's get this done.

See, I would, I would be the one who would say, okay, I'm going to do this. And then I'm going to shut this down. As soon as this podcast is over, I'm going to record the intro and the outro to this thing. I'm going to put on workout gear and I'm going to throw my AirPods in my ear and I'm going to go listen to a podcast. Because I'm taking a break, right?

Yeah. If the podcast isn't business related or gets you thinking about business, it could be good. Uh, one of the things I recommend in the book, comedy is awesome. So if you know, you have a YouTube, it in general wouldn't be a great idea just getting on YouTube or TikTok. But if I'm purposely going to watch a comedian and maybe there's a already a built out playlist of comedians, that's totally great. Like Pandora, I, I'm old school. I still have a Pandora account and I have a Brian Regan station. He's one of my favorite comedians. And so it just plays comedy routines from people similar to Brian Regan. That's totally appropriate thing to do during a break. You just don't want it. You don't want it to stress you out and you don't want it to bring your mind back to things you have to do for work.

Okay. All right. So, all right. That's helpful. And especially in the context of the 90-minute block that I'm referring to, but to your point, what if I go 3 hours? Okay. So now we're up to 180 minutes or so, and then we need to take a 30% of that. So now we're at 54 minutes. So I'm going to be 3 hours on, but before I get into that, is there a Is there a cap of the, of the time where it's like, okay, pretty much anybody, you're, you're, you're off a cliff past 3 hours?

Yeah, 3 hours. That's why it's the 3.3 rule. 3 hours is the max we want to do.

Okay. All right. So if you're going to go 3 hours, hour break, 3 hours, hour break or whatever that may be. Okay. That's a, that's a, that's helpful. That's helpful.

Okay.

Well, I could listen to my NBA playoffs, JJ Redick. Yeah. Podcast or something like that about— yeah, some— yeah, okay, that, that, that is helpful. And to your point, like, um, I, I, I am guilty of doing that because I actually enjoy— I enjoy work. I, I love work.

And so most of us do.

Yeah, I mean, it gives me a lot of, uh— it's challenging. Um, entrepreneurship is hard, and I like hard things, um, apparently, I guess. And, uh, but, but it— not realizing that it's always— I'm thinking about it always on, or, you know, all the time. That's, that's really helpful. I love that. And I think you're right. I think that Cal Newport introduced us to the idea of like needing to go deep. And I think that was good. But to your point, it was like, yeah, but like, what's the, what's the, how do I implement that? What does that actually look like? I mean, am I just going to be deep all the time? I mean, at the end of the day, I have to send these things to my bookkeeper. Like, you know, like they got to get there, you know, at some point I can't just be like, I'm, you know, I, this is, I think this has come out from, um, Wickman's, uh, book Traction, you know, like people have taken this idea of being a visionary and they just think I'm just going to go visionate all over the place. You know, that's, that's all I do.

You know, keep your visionating to yourself.

Yeah. Like I'm just visionating, you know, like that's what I do. I visionate and go deep all the time. I mean, heck, even our podcast is called Above the Business. And the reality is you can't live above the business in la-la land all the time. You know, nobody thinks that you you can do that. So, uh, man, by the way, before, uh, I let, let you share with people how they can connect with you, you got to push back a little bit for people that can't, aren't listening or can't see this on YouTube. He has the most amazing— of all the 370-something episodes, I've never seen a shirt like so good. It says, 'Dear IRS, you suck. Warmest regards, everyone.' That is epic.

Yeah, and you can own your own t-shirt by going to insidetax.com/shop.

Oh, that's great. That's so good, John. I've enjoyed chatting with you. People want to connect with you, obviously want to pick up the book. Where would you point them to?

Amazon's the easiest place to pick up the book, The 3.3 Rule, or you go to 33rule.com. And, you know, our our firm's website is InsightTax.com if you wanted to see about any. We have so many blogs out there about accounting and tax savings and things like that.

Awesome. John, appreciate you coming on, my man.

Thank you very much.

Well, what a fun interview. I thought that John just had so many just great takeaways, practical things, both like high-level ideas, but also just down into like really tactical things that you can do in the business. And hopefully, I mean, he's seen so many different people with their, you know, financials. I, I really do love his book, especially, you know, The 3.3 Rule. If you've picked up any of the stuff from Cal Newport, I mean, I know we talked about on the podcast, but I, I am really— and I don't say this often, you know, I have a concept called Perfect Repeatable Week. And one of the things that I'm really going to consider is first, before we, you know, share that with anybody else, I'm going to implement it myself because I've not structured my days and my week like that. But it does make a lot of sense as too often my week may be structured correctly, but my days can get a little jammed and I don't take the time to take a break. And so maybe I'll report back on you, report back on that and share with you kind of my insights and my takeaways. And then also, you know, every story I shared was simply not at all to make it about me, but maybe to just to be open to let you know that, hey, if you struggled with financials in the past, I've been there. You know, I mean, I got my doggone degree from Auburn University in finance and— but I did not know really how to look at small business financials. And that is not a stretch at all. And so if you've been there, just know these are skills. When I got to a place of kind of raising my hand and saying, you know what, I don't know what I'm doing. But then at the same time saying, okay, but I'm going to go figure it out. I think that this, you know, I can't be that dumb. I can actually go and like get access to some of the information. It took me a long time to be able to do that. But anyway, appreciate John coming on the podcast. Go and check out his book, reach out to his team. And look, if you are an insurance agency owner and you want help doing this, Club Capital can help you to be able to do that. So go to club.capital. Book a no-obligation demo. Love having John on there to be able to talk about some of that stuff. And so many of you, if you're a Club Capital member, you understand and already get access to, to some of these insights. And maybe, maybe you're not even utilizing some of the tools. Maybe this is a good refresher for you to kind of, you know, get access to the tools in the formats the way that will help you. Because at the end of the day, they're designed to be able to help you have insights and, and be able to make better decisions in your business month in and month out. Go to club.capital. Shout out to our podcast partners, Autopilot Recruiting, Today App Pro, and Coach P Consulting. I think one of the biggest— I've heard Hormozy say this recently— but one of the biggest arbitrages that's still out there is with your team. And you got to be able to find really, really good people, and you got to be able to coach them and develop them with your team. Go to autopilotrecruiting.com. And so many of my members and Club Capital members are working with Autopilot Recruiting, having a tremendous amount of success. Having a dedicated recruiter on your team is absolutely next level. Go to autopilotrecruiting.com and it's more affordable than you think. When you want to develop them, you want to be able to work with them to be able to get them up to speed as quickly as possible once you onboard them, and at the same time continue to expose them for them to be able to see what's possible. Coach P can help you. Go to coachpconsulting.com and let him know you heard about him on the club— excuse me, let him know that you heard about him on the Above the Business podcast. When we onboard someone with Blueprint, we'll walk through and we have a whole tech stack of the different things that we're going to utilize to be able to get somebody up to speed. And we have a whole, like, different softwares that we use for, for different things. I think it's like 12 or so. And you may not have that, but what's in your tech stack? Are you using a company that your team loves, that you love, that can help you get away from the Excel spreadsheets, put some of the word tracks, maybe some of the ones that you have yourself, or some of the word tracks that you've picked up from Coach P. To be able to put it right where the work happens, to be able to track their bonus, their commissions, their monthly commissions, their bonuses, etc., all in one place, TodayApp Pro can help you. Go to todayapppro.com. TodayAppPro.com. All right everyone, hope this episode helped you. By the way, if you would love to have help in designing, building, and installing an operating system for your business so it's less dependent upon you got a number of different assets that you can take a look at. Go to blueprintos.com/assets, blueprintos.com/assets. Take a look at the different assets that we have on the page. I'd love to be able to, uh, send you over some things, some tools that we utilize, been helpful to us, like the Perfect Repeatable Week. Till next time, lead well.