He BUILT a FITNESS EMPIRE from SCRATCH | Peter Taunton | The 2%

So important every day that you look in the mirror and you believe in that person looking back at you. That is absolutely key. Because in those moments of difficulty, you've got to believe that you're capable of powering through it. I'm the youngest of seven kids. I grew up reasonably poor. I went to school in a two room schoolhouse. I had ADD that was off the charts. I went to college, quit college my junior year, and then went on to build one of the largest wellness brands in the world. I mean, I'm living proof that the American dream is alive. And if you're just willing to lean in and not settle, just continue to grind it every day.

Hello, everyone, and welcome to another episode of the 2%, where, as always, we're interviewing peak performers in all walks of life. Why? Because we want to help you elevate your game professionally, personally give you tips, tools and strategies that you can use to close that gap between your current and best self. And I'm super excited today to be interviewing Peter Toutton. Peter, welcome to the show. Great to have you here.

Hey, it's my pleasure. I've been looking forward to this all week.

Awesome. So you're away right now, right? You're at your lake home, you said?

I am. I spend about nine months of the year in Miami and then three months back here in Minneapolis. And you know what? If I could pick up and give you a tour, I would. It is absolutely a beautiful day out here on the lake and it's very peaceful. It's my little getaway, my little slice of heaven.

Awesome. And Miami is a great place to be in as well. I love Miami.

I love it, too. You know what? Miami, it's got a great energy. Obviously, the weather is great. And what initially drew me there was it's just a favorable tax state here in the United States. So I moved to Florida for that, but then ended up picking Miami just because I love the energy within that city. So much diversity, so much ethnicity, which I really appreciate.

Yeah, yeah. Lots of vibrancy. And of course, a lot of great weather, too. Now, you are quite the achiever. So, founder of Snap Fitness, which we're going to be talking about. You've been recognized by Ernst and Young as the entrepreneur of the year, CEO of Lift Brands. I mean, you've done a lot. You've been a pioneer in the whole fitness space. But we're going to get into all of that for sure. But maybe take us back. Let's go back into the time machine. You didn't start off this way. Right. So what were the humble beginnings? Share, please.

You know what? I grew up. I have an identical twin brother. I don't know if I told you that, Eric, or not. I have an identical twin. Yeah. And we are the youngest of seven kids. And I grew up in a small town in rural Minnesota. And I set that up because I want people to understand that it doesn't matter where you're from, how small you're. I mean, think about this, Eric. I'm the youngest of seven kids. I grew up reasonably poor. I went to school in a two room schoolhouse. I had ADD that was off the charts. I went to college, quit college my junior year, and then went on to build one of the largest wellness brands in the world. Right. So go figure it. Now there's a lot of road rash in there, but I mean, I'm living proof that the American dream is alive and well, if you're just willing to lean in and, and not settle, just continue to grind it every day and.

You have a good story about popcorn, don't you? As a kid? Yeah.

My father owned a grocery store in this small town of ours. And when you turned about 8 years old, my dad put you to work. And it was not a choice, right. He would say, hey, look, you're going to start selling popcorn on your eighth birthday. So that's what you did. And with my dad, he was. And I responded well to this type of discipline. My dad would say, look, make no mistake about it, son, you're going to either be working for me, going to school, playing sports. That's your life right there. Because he kept me out of trouble, right? And it was good for me. It really was. He taught me an unbelievable work ethic. And I'll be honest with you, as a child.

I didn't realize today.

As a successful entrepreneur that some of the lessons I learned as a boy would be so applicable in my later lives. I had no idea. But as I sit back and I reflect, I realized, wow, you know what, what a gift that was that my father passed on to me. In fact, after I sold the first portion of my company, of one of my companies.

I called my father and I said, hey, look. Because they made it public of what it was, what I had sold it for. And I told him, I could never repay you for the lessons that you taught me over the years of just how to lead people and how to get people to walk on fire for you. Right? And it was just my dad being able to. He never put himself above anything in that small Grocery store. He was the owner of the business, but you would see him shoveling the sidewalk, bagging groceries, working the checkout stand. I mean, he did it. He did it all. Stocking shelves. And the reason he got people to work for him and really pull deep on the Os for him is because they knew that he had their back. If somebody was getting slammed in their aisle, not being able to keep up with the grocery demand, he would jump in there, help them stock their shelves, because, you know, there was one person assigned to every aisle of the store, and it was their job to make sure the store looked full. Right. That was their job. And sometimes, let's face it, my dad had a very, very busy grocery store in this little town. And that's because everyone loved him. Why? Because he was so approachable, such a great guy.

So this is a nice thread to kind of pull on. So the lessons that you learned in those early years and then how you applied them, how they shaped you in business later in life. So certainly one of the things you're talking about there is that no job is beneath you, right. As an entrepreneur, that you have to role model the way. So can you take us through some examples of how that influenced you then?

Well, for, you know, for my father, it's the. When he started at the grocery store, he was. He was hired to come in and they gave him an ownership position in the grocery store. But the goal was to try to turn this failing grocery store around. I mean, it was. It was not reaching, it was not utilizing its full potential in the eyes. It was a red owl store, by the way.

Right.

And so they hired him to move from a big major metropolitan area out to this small community where he was going to try to turn this store around. So things were not favorable for him. So what did he do? He gave it everything he had to working seven days a week and re engaging not only the business, but himself, immersing himself in the community, because he realized without the community behind the business, the business will not thrive. So he was just in complete utilization of every aspect of growing his business. He was very efficient from an operations perspective, but he was also very disciplined in making sure that he was part of that community sponsor sponsoring the football teams. I mean, when you come from a small town, Eric, I mean, you got to be sponsoring the little league baseball teams, you got to be going to the football games, you got to do it all, you got to be present in the local parades. You got to be part of all of it. And he was.

And so you Took that. What was the first business that you kind of took this kind of mentality then into?

Well, the first one was the opportunity. I had an opportunity when I was 22 years old to turn around a failing health club. At the time, I was a professional racquetball player. And I got a call one day.

Wait, hang on. You're a professional racquetball player?

I was, yeah.

That's pretty cool.

I was, yeah. My twin brother and I. I was a touring Pro for about 12 years. Yeah, it was great.

Okay, can you take us back to that? Because that sounds like that was happening before you even gotten into this, into your health club gig, right?

Yeah. And, you know, I'm a. I'm a Christian guy. And I always think that everything happened in my life. When I sit back and I look at my life, how did this kid who this. This kid who went to school in a two room schoolhouse, how did he get from there to where I am today with yachts and multiple homes and jets? And how does that happen? Right. And if so, I'm very thankful for the life that I have now. Granted, it was a lot of hard work. I'm not gonna. I'm not gonna lie about it. And I believe that anything is possible, which is. My book, Impossible Hill, talks about it. So for me, when I was 13 years old, I was playing. I was like most small kids. I played football, baseball, basketball. Those were my three sports. But when I was 13, I picked up a racquetball racket for the first time in my hometown. And it was a big deal. It was a small town and a racquetball club opened up. I'd never played racquetball in my life, but for some reason, that sport really catered to my athletic abilities. And. And in a matter of about a year and a half, I was really, you know, I was. I was a really good player. I was a really good player in my town. And then I remember I went to a national tournament, okay, which is one of the first tournaments I'd ever played. And I got beat, Eric. I got beat 21 to 3, 21 to 2. I mean, I got absolutely pummeled, decimated, right? And I thought I had a competitive chance going into this tournament. But what it did, it opened up my eyes. It opened up my eyes to how the game was supposed to be played. And I went back to my hometown and worked on my game, and within three years, I was a touring pro. So once I saw it, I put in the work, okay? Because I had never seen it played at that level, but once I saw it, then I knew the work and the intensity of which I had to embrace that sport. Now, I didn't know that I was become a pro, but I knew that I wanted to play like that. And that's what I set my mind to.

Right. And there's something pretty powerful, right. About having your ass handed to you. Right. When things don't go your way.

Yeah. And you know what? You don't know what you don't know. And I didn't know that that's how that game could be played. I mean, it was played at such a different level, at such a different pace than what I played. So I really respected and appreciated that. And the one thing I that is so important in everything that you do is you have to believe in yourself. So when I saw it, I believed that I had the athletic ability to take it to that level. So I never once thought, man, there is no way I am going to be able to do that. I looked at it and I said, okay, I got it. I have seen it. I got it. I know what I need to do. And that is exactly what I did.

So when people get kind of thrashed like that in business or life and just completely decimated, because you could have easily just decided after a couple of those beatings that, look, this isn't for me. Right.

It was so embarrassing. You wouldn't believe it.

Yeah, exactly. And I think that would kind of be like the default reaction or response.

Why do you think it's so tough for people, for a lot of people, when they really get hit hard to recover?

Well, I think one of the first lessons you need to learn in life and in business is that life is unpredictable. It's uncertain. And in those moments of uncertainty, every time you face adversity, you can't look at it like you've been completely blindsided. And we all know people that are like that. And when I do my consulting today and I'm mentoring, I say, hey, look, understand, that's just life. That's just how life is. Life is not always kittens, balloons and butterflies. Life is uncertain. Life sometimes sucks, right? And you've got to embrace it. And you are going to have failures in your life. So the key is when you fail, fail fast and learn from it. Right? Don't get hung up on, man. I'm a failure. You're not a failure. In fact, I always say, if you haven't failed, you're not trying hard enough. All right? And I often say, eric, anyone can be an all star if you set the bar at your ankles. Ok, so you know what? Get in the game and don't be afraid to fail. And, and believe in yourself. Believe that you are capable and most important, believe that you are as deserving of success as the person next to you. Okay? I mean, you deserve it. But it's going to be work. And if, you know, you got to, you got to have the right mindset to know that it's going to be hard work, there's going to be sacrifice, it's going to be uncertain, it's going to be scary. I mean, those are all parts of winning.

It's a real key mindset shift, isn't it? Because I mean, if we just take stress as an example. So you know, a lot of people when it comes to stress, stress in business, stress, kind of mentally, they're of this thinking that, oh my gosh, stress is bad, I need to run away from stress. But it's funny, right? Because you as a former professional athlete or anybody who goes to the gym, they certainly don't view that when it comes to their body. It's not like we go into the gym. You know, you've run all these health clubs. How many times does somebody go into the gym and say, can you please point me in the direction of the exercises that will stress my muscles the least?

Yeah. Right.

Because we know in the context of our bodies that the stress builds strength. Right, Right.

Push yourself to those limits.

I mean, I always tell people, look, you know, depending on what their goal is. Right. Depending what their goal is and depending on what their age is. But I tell people, hey, look, you know, as soon as it starts to get uncomfortable, as soon as you start to feel that lack of acid buildup in your arms or your legs, whatever particular muscle group you're working.

That'S when you got to go to work.

Right then.

I mean, that's when you got to push yourself beyond that pain. That pain is not hurting you. You're not straining your muscles, you're not breaking. Look, you're going to be perfectly fine. But if you want to grow your muscles, you got to push it. Just like if you want to grow in business, you got to push yourself.

Yeah. Hearing you talk right now, it sort of reminds me of in university, I went to University of Illinois, Urbana Champaign.

Yeah.

And two of my roommates, they, two of my training buddies, they ended up placing number one and number two in the state's natural bodybuilding competition.

Wow.

So I would go training with them quite a lot. And I'm sharing this. Cause it kind of really. I think it relates to failure and it really relates to some of the concepts that we're talking about here, about pursuing stress. And when we'd be in a workout, I'd be getting towards that 9th or 10th rep. And I always remember they'd say, these are the ones that count. All the ones before that don't count. These here. This is all that counts. If you fail here, everything's gone, the whole set.

I love that. Right?

That's kind of the similar attitude, you know, you're talking about when you feel that. Almost like when you feel that lactic acid from a business point of view or the stress from the business point of view, right? That's where you should be. That's where you're going to win the set, right?

And that's what I talk, you know what? In leadership. So leadership qualities, you know, anyone can run a business with the wind at your back, okay? It's just smooth sailing. It's easy. You know, I always say people's character is defined in moments of strife. Okay? In moments, that's where you know who the true leaders are.

When they.

When they've been. When. When competitively within their marketplace, they feel like they've been blindsided. And they have to make. They have to make tough decisions. They have to pivot because their business is no longer relevant. And that becomes risky and uncertain. And it brings a whole new wave of elements and emotions that come into play, right? And that's where people are defined. Just like in sports and in life and in business. It's all the same.

It even applies as we're talking here. I'm thinking about. Because we both have kids, right? It even applies to parenting. It's like, is the measure of a good parent how well they parent when the kids are well behaved? Or is the measure of a good parent how well do they parent when the kids are misbehaving? Quite badly, right?

The idea. That's a great point that you make, Eric. And you know what? Everyone. And I'm not here to judge anyone on how they raise their kids, right? I know it's a big job. It's a big job with probably the largest responsibility you'll ever have in your life. But some people operate from a position. They want to be their kid's best friend, and others have find a nice balance between providing structure and guidance and still being their friend. Do you know what I mean? I was. I was of the latter. And it still doesn't mean that you're going to win in every case that, you know, we have. We have things that happen in people's lives that, you know, are really difficult and challenging moments. And that's. That's just life in itself. Cool.

All right, so got pro racquetball player. So we've gone through that now. We got this incredible job opportunity that's presented to you, right, at an America fitness center. And can you tell us a story about that? Because this is quite fascinating, what you do here.

Yeah, literally, when I got a call one day, and it was from the owners of the club that I had played at as a kid, right? So that club was failing financially. And I told them before I moved, at the time, I was living in Orlando, Florida. And I told those guys, look, if you ever want to turn this club around, give me a call. And I didn't think my phone would ever ring. About a year and a half later, my phone rings, and it's these guys. And they said, would you ever consider coming back to Minnesota and running this club and turning it around? And they said, here's the deal. We'll pay you $16,000 a year, but if you turn it around, you can buy us out with the profits, because we're done. We've had enough of this, okay? So that. To me, now, some people say, peter, and the club was losing $200,000 a year, right? So there was five owners. Every one of those guys was kicking in about 40,000 a year just to keep the lights on. Anyway, they came. So some people would say, peter, that is crazy. And I always say, you know, what opportunity, it doesn't knock it. Whispers so you have to see when you got your break, you have to see it and feel it. For me, I didn't look at it like, oh, my gosh, this club is losing 200 grand a year. I looked at it, and I said, God willing, if I'm able to turn this thing around, this may be. This is my springboard. This is a chance for me to own my own business, right? And I was able to do that over the next eight years, I was able to turn that club around, buy everyone out. And I went and I refinanced it, and that became my springboard. That business, I took it from losing $200,000 a year to making $250,000 a year. That's a $450,000 swing. Keep in mind, in a small, little rural community, okay? So it was really a big deal in my life. And then I went on, once I paid My loan down, I was fearless, because when you start with nothing, when you survived at the bottom, you're fearless, right? So as soon as I had my club paid off, I got a loan, I built another club. I did that seven times. And I did that for the next 20 years. All right? Built it. So I had seven clubs. I sold all my clubs. And when I was done, when the dust settled after 20 years, at that time, I was married. I had kids that were five, three and one. I sold my business. My life savings at the time, Eric, I had about $3 million in the bank, and I didn't have any debt. And that was my life. That was my life savings at that time. And so then sitting back, I was doing some odd jobs here and there, thinking about what my next deal is going to be. And then I thought of Snap Fitness. Okay? I thought of I'm going to create a club, and went through this whole process. And I didn't know at the time that I was going to build one of the largest wellness brands in the world. I didn't believe that that's what I was doing. But as I sit and reflect now, in hindsight, I say that 20 years of taking a club from complete failure to a complete golden child.

That in itself was a great learning platform for me. So I was positioned to make something great. I didn't know that I would actually execute on it. And when people talk to me about it today, I say that I believe that one day I would have 6,000 locations in 28 countries. No, but I would follow that up by saying, I'm certainly capable of doing it. I knew that. I knew that I was capable of doing it. I didn't know that I would actually do it. So it really comes as no surprise that I was able to build this big empire. But make no mistake about it, I stood on the shoulders of amazing people, ok? Because winning in business, it's a team sport, I promise you. You got to have great people that share in the same passion, the vision, and they're willing to walk on fire for you. You got to surround yourself with people like that, that lean forward and take the shots with you.

That's what it takes. Can you. Can you just repeat that? How many locations? How many countries?

Today I have 6,000 locations spread across multiple brands in either franchises or licenses in 28 countries. Go figure, right?

Absolutely incredible. And what I love, there's a common thread here, right? So there's.

You experienced some extreme failure in the whole racquetball arena, became a pro player, you were introduced to a failing business with this health club opportunity. You turn that around and as you so wonderfully said, when you've experienced the bottom, when you've experienced the worst, it literally can only go up, right? You've seen all shades, all shades.

And you know that the bottom, you know that you survive there, okay? So, you know, as bad as it could possibly get, you live, you, that's where you lived for a long time, right? So you're, you become fearless now as you get, as you become older and you start. You know, for me, when I started Snap Fitness, keep in mind, I had $3 million in the bank within, within five years. And this is something for important for your, all your listeners, right? Keep in mind, I was about 40 years old at the time. I had $3 million in the bank. And some people said, Man, 40, you're a little bit long in the tooth or whatever, right? You're a little long in the tooth. But within five, six years, I went from having $3 million in the bank to having a business that was valued at over $100 million, okay? And I sold. When I was 45, 46 years old, I sold 40% of my company. And I remember it, I could tell you where I was the day when the funds landed in my account. I sold 40% of my company for $47 million, okay?

And I could tell you I was walking down the first fairway at Spring Hill Country Club and my phone rang and it was my attorneys and my accountants saying, hey, Peter, the funds have been transferred. The funds have landed in your account. And I hung up my cell phone and I went to my Wells Fargo account and I saw, you know, 47 million and change there. And I knew that moment, I mean, my eyes welled up. My friends are wondering what the hell's going on. They thought it was some tragedy. I said, man, you know, I did it, right? The kid from the two room schoolhouse actually did it. And, you know, I was living proof of it. And I knew at that moment that my life would never be the same. And it hasn't been in all the right ways.

So what with everything in mind that you've shared so far or even may, perhaps one of the lessons from your book Impossible Hill.

What is one of the things that most entrepreneurs should be doing but are not.

Should be doing that or not? Well, you know, entrepreneurs are. They're an interesting breed, right? Because I have the opportunity, the blessing. Since I stepped down as a CEO, I do a lot of consulting. And a lot of times I Meet entrepreneurs and they're thinking about launching a business, but they don't have enough capital. Okay? They've underestimated the capital need. But the other piece of it that is hard to see and recognize is they're not in the mental mindset, okay? They don't have the discipline to get into that business. To willing to take the punches that can come with owning a business. Hey, look, we've all heard of people where they start a business and it just came easy and it seemed like it was effortless.

That's one. But that's a rarity, okay? Most people, I think in life and in business, you got to plan for the worst and hope for the best. So for people, I say, look, you got to be mentally prepared getting into business that you're going to have some sleepless nights and that's part of the journey. It's not that it makes it a bad thing. Appreciate those moments as well. Appreciate the uncertainty that comes with building a business. Appreciate how you've got to leave yourself completely open to change and ideas, especially early on in a business. Because the last thing you want to do when you're starting a business is not be flexible because the consumer is going to determine whether our product is relevant or not. And so listen to your consumer. Listen early and listen often and make the slight changes that you need to. So number one, you can continue with that customer relevance, which equates into customer loyalty. And a lot of people that get so caught up in this is my dream, this is my business, and it's my, my, my, hey, look, it may be yours, but you're failing on these three points in the eyes of the consumer. It's time for you to pivot.

So let's talk about Snap Fitness. And so as you're, as you're building this and it becomes the hundred million plus valuation company that you grew it to, what were some of the changes or the pivots that you had to endure?

Well, fortunately, the fitness space, it evolves. I mean, you think about it, in the years it used to be you had a universal gym and a Schwinn Erdyne. I mean, that was as archaic as it got. And now today, interestingly enough, today it's not about heavier weights and faster treadmills. It's about the community and culture you can create within your four walls. I mean, we evolved from when I started Snap Fitness. Those clubs were only staffed 20 hours a week. It was like going into a hotel gym on steroids. You had a key card, it got you into the business 24 hours a day. You belong to one, you belong to them all. It was affordable.

And it was like $35 a month. And it was relevant at that time with the consumer. But here's what changed very quickly. Pretty soon the consumer wanted it staffed more often. So today that same product, it's staffed from about five in the morning until about eight o' clock at night. It's a lot of group fitness and functional training. It's just, you know, it's just evolved into what the consumer is looking for and it continues to evolve. Every one of our members, when we onboard them, we onboard them with a heart rate strap because heart rate based training is where it's at. Right. I mean, otherwise you can just fake it. You can't fake your heart rate. Some people say, oh, I'm short of breath or they're sweating. That has nothing to do with how hard you're working realistically, because you could be dehydrated, you could be sleep deprived, it could be a number of things, but your heart rate doesn't fake it. Right. So training within that heart rate zone, that's going to get you optimal performance is key.

Yeah. And I can totally just relate on a personal level to, I mean, the training has changed so much since when I was in university and you know, in the nine early, you know, in the 90s, it was just, it was just, it was just for the guys, it was just go to the gym and try to lift as many heavyweights as you could to get as big as possible.

Right, right.

And now, now it's so much more scientific like you're saying. And so much more functional as well too. Right?

Yeah, functional. I mean, and even some of the, you know, I'd be curious to see your two buddies that were, that were the bodybuilders. Most of the bodybuilders did very little cardio unless they were cutting for a contest. Okay. So they pumped a lot of weights, their diet was really tight, really strict, but very little cardio. But today, you know, the real athlete, you incorporate, you know, good cardio, good cardio, interval training and then good resistance training. You know, it's the muscle training and the heart training, it's all together. And then obviously, you know, abs are made in the kitchen. A lot of people don't understand that you can do a thousand sit ups a day, but abs are made in the kitchen, no question about it.

And they're not. And that, that does not include being made with Ben and Jerry's.

No, that's exactly Right, Yeah. And you can have that. You know what, you can have those moments. I love sweets. Right. But I just, I don't, I just don't have them in every, every day. And I, and I do, I exercise every day, which is how I stay in great shape.

I'm with you on that. But equally, I have to admit that. Oh, man, if I see some of those Ben and Jerry's containers nearby.

Yeah, right.

It's hard to resist. So one of the quotes which is part of your whole management philosophy is that success is 10% of what happens to you and 90% of how you react to it, which I love. Just. That's such a beautiful statement. And can you give us a couple examples of where you live that maybe one professional and one personal.

Yeah, I had a.

And this is compassion as well, because at the end of the day, you are who you are, right? And whether you're at work or whether you're out on the street, compassion goes a long way. And I think that, you know, that everyone should be, you know, you should be respectful of others. You should love and, and be fair. Right? So that's just kind of how I roll. And I remember one day, not, not too long ago, about. It was probably eight years ago now, seven years ago, and I had one of my employees, and he was one of my, one of my earlier employees who had embezzled over a three year period about, about three and a half million dollars from me.

Oh my gosh.

He ran one of my division, you know, at the time. Now my company since growing, it's a 200 million do over a period of.

Three years. He embezzled this money and the money had been spent. Anyway, we finally caught him, right? And at that time, when my CFO came in and they said, hey, Peter. And he came in, his face was white. And he comes in my office, he goes, I got something really terrible to tell you. And I said, well, what's going on? I thought someone had died, car accident, whatever. He goes, you know, this individual, I won't say his name.

He'S been embezzling from us for the last three and a half year or three years, and to the tune of three and a half million dollars. And.

I mean, my first thing. And he, I said to him, at first I was upset. You could see the upset. I was upset. And then I was disappointed within a minute. So I went from being completely pissed off because that's a lot of money. Secondly, I was disappointed because he was one of my first employees, right? And I trusted Him. And I felt completely betrayed.

But then I said.

Does his family know? Because I knew that life was never going to be the same for him.

Ended up talking to him. He had spent all the money. He had a drug and gambling problem. Spent it all. In fact, he not only blew through that money, but he was about 300,000 in debt to a number of different casinos in the area that. Where he had extended lines of credit. Anyway, it ended up costing him his divorce with his wife. It was a bad deal for him. So I felt compassionate about it. But in those moments that we all have, and some, you know, whether there's different degrees of those moments, but I always talk about the importance of maintaining your composure. And that's so important that, you know, some people's leadership style is they're going to yell and scream and kick the garbage can and, you know, do that whole scene. But understand that that is. That's what people remember. I mean, just like when people hear the story on the street, anyone that was in that room at that moment.

Yeah.

Their first question is going to be, what did Peter do? Okay. And the answer's got to be, you know what? He was calm. He was composed. You know, he was. He was obviously visibly upset. But within a couple of minutes, he asked about their family and, you know, how are they doing? And, you know, it's. So that says a lot about just people in general. Right. I knew, you know, he ended up going to jail and doing that whole thing, so I knew how the story was going to end for him. And, you know, and I helped him any. Any way that I could. But, you know, he. He had to pay the. He had to pay the consequences for his bad choices.

But you still were able to demonstrate. Yeah, just, you know what?

Keep it. Keep it real. We're all human. We're all flawed. And. And, you know, it was very, very poor judgment. I happen to be on the receiving end of his poor judgment, and it's very, very unfortunate. And that's money. We never got it back. You know, the money was gone. It was not coming back. We didn't have insurance for that type of thing.

So it's kind of crazy that it was even a little bit more than your entire life savings at the age of 40. Yeah.

Right. I never thought about it like that. Thanks, Eric. Thanks for bringing that up.

Shows you how successful you had made your business that you were able to kind of absorb.

Such a failure. Right. I mean, that was. That's definitely not one to notch up on the wind board. So.

It was unfortunate. It was a great learning experience for me from that point forward. I never, I made sure that we had unbelievable checks and balances within the department and then outside of the department by third party auditors and whatnot. I mean, now I don't leave anything to chance. Yeah. And it's easy for people to steal. How people, it's interesting how people rationalize with it in their heads when they see a business that is clearly growing by leaps and bounds year over year. So people just feel like, you know, I'm going to take some of this. It's unfortunate.

How about on the personal side? Something that kind of brings to life success is 10% of what happens to you. 90% of how you react. It.

Boy, you know what, I've been, I've made a lot of investments. I made a lot of investments.

With business associates and friends. And you know, it's not every deal is up and to the right, you know, in terms of the performance. And.

For me, you know, you learn some of those valuable lessons. You know, no one comes to me with a bad business idea. Every one of their spreadsheets look fantastic.

Yeah, yeah, of course.

And it's just a no lose type thing. And you got to get burned by a few of those. I think to get, to get savvy enough to realize that, look, you know, where I need to stay is my core. My core. I need to stay within my core competency. So that's what I do. I kind of stay in my lane. But I happen to be, I'm involved in probably 10, 10 different companies today.

Right.

But even in the, but even those 10%, it's not, it's not more than 10% of my net worth. So if every one of those companies were to fold, it's not going to affect.

Me and the lifestyle and the legacy that I put in place for my charities and family members and loved ones. Right.

That's a nice way.

Yeah. I keep a balance in my life. It's really difficult to hit two grand slams in the same game for me. I talk about cash preservation. How do I manage that? And then how do I still have enough capital to invest in some things that are kind of fun and interesting, but it's never fun losing money. Right. It's never fun. And that's just what it is.

That's life.

I like that though. I think that's a nice, simple metric. Not more than 10% of your net worth. Got it.

I mean, I see so many people, it breaks my heart when I see people that have Managed to sell a business and let's say they have $10 million. I was just consulting a guy just a couple of months ago, he sold his business for just a little less than 10 million. And 10 million is a lot of money, don't get me wrong. But it is not a lot of money when you do what he did. Okay? He went and bought a large boat, bought a second house, was traveling all over the world, spending money like a drunken sailor. And when he comes to me, he has about little less than 5 million in the bank. So he's.

Yeah.

So over a period of 5, 6 years, his 10 million is not 18 million. Now it's 5 million. So I told him, hey, look, you need to stop the spending. I mean, I put him in a position. We sold all of his depreciating assets and any assets that he has as well that are just costing him. You know, owning a large boat that's got a price tag before you even use it, there's costs associated with it. You got slip fees. And I know for my boat I have slip fees, I have insurance, I pay my captain. There's a number of things that come with it before I ever take the boat out on the water.

Right?

So we just had to strip all that away and then figure out what's the passive income that 5 million can drive for him and make sure that that falls within his lifestyle. Because he was adamant he didn't want to go back to work. I told him, well, you will go back to work. If you keep spending like you are, you're going to be out of cash in the next five years. Make no mistake about it. And then now the unfortunate piece is you're going to be in your early 60s, going out and trying to get a job in this workforce, trying to support a lifestyle that you have today. It's just not going to end well for you. So you got to swallow your pride. That's a big step for a lot of people, especially men. Swallow your pride, start selling all this bullshit that you've bought over the last five years, that they may have brought you some happiness, but you are squandering your money away. And quit going out for dinner every night and buying dinner for everyone you see and playing and playing this role that you obviously can't. It's not sustainable for you. You know, you had 10 million, not 100 million. So let's just put it in the right realm. So he's in a. He's in a good place today, but he's not. He's not going to be. You know, he had to make some serious changes and reflection on how he wants to live the rest of his life.

Yeah. And you have a lot of wisdom, right, that you're able to draw on to help these folks. Yeah.

And, you know, we're all living longer. You know, I just heard, I just heard yesterday. Anyone that's born today.

Has a better than 50% chance of living to 103.

Wow.

Yeah.

That I had not heard. That's amazing.

Yeah. 50% chance of living to 103. So that's amazing. I mean, that's. I mean, you think about it today, we come across people all the time that are elderly. I mean, my dad is 90 and he runs a ranch in South Dakota. Right. I mean.

Yeah, yeah.

So it's possible, but you got to stay active. You got to stay on it.

So I want to go back to the flip side of a question that I asked you earlier. So what's one thing that most entrepreneurs are doing but that they shouldn't be doing?

Well, I think financial discipline. Okay. Is a big key. I mean, for me, early on, especially in a startup company, it's so important that you're taking every dollar that's made and you're putting it back into the business. If you're in a products and service business, obviously putting it back into inventory, because if you don't have the inventory, you can't sell it.

Right.

So to me, putting. Investing the money back in the business rather than pillaging the company. And it never has any enough dry powder to grow and evolve as the consumer demands.

Right.

I mean, for me, I, I was a big proponent of that. I put every dollar back into the business because I knew there was no better place for me to put my money than back into the business. And I knew every time I put a dollar in, I was getting five out. So it made no sense to put it anywhere else. Yeah.

I mean, if you're an entrepreneur, as I've experienced as well, it's like one of the safest places that you can invest is within your own company.

You got it.

You have such incredible inside, you know, knowledge and, you know, ability to influence the decisions and the direction and everything.

All of it. Yeah. So key.

What, what's, what's one thing that Peter believes that most other people don't?

One thing that I believe that others don't.

Wait, that. That's a tough one, Eric, Because I, I believe, you know, I always say hard work works. Right. You know, I believe that there are no shortcuts in life or in business. And I don't think I stand alone in that fraternity.

You don't stand alone on that front. But I'll tell you what, geez, all you have to do is go onto the net and see tons of people trying to pedal dreams and other approaches that will get you to the place of riches very quickly and all that. And it just does not work that way.

Yeah. And I say that. You know what? It's so unfortunate that today social media has many great things. It's a great place to get information. But the other side of it is there's so many people faking it on there. There's so much false sales and false lifestyles. And what breaks my heart is when people go to the Internet, social media and they start looking at everyone and they think, man, I'm a complete failure. I thought I was doing all right. But they see some guy standing in front of a Ferrari, he doesn't own a plane, he doesn't own, he's fanning hundred dollar bills and he says, you know, buy my subscription, buy my book, buy my this, and I'll make you rich. You know, to me, anybody that's doing that, who's selling, who's selling something, they're a fake.

They're a fake.

They're an absolute fake. You know, so most of the mentoring I do, most of the consulting I do, most of it I do for free. Realistically, I do it for free because I feel like myself coming from a two room schoolhouse that I feel like I owe it to society. I feel like I owe it to, you know, to give people a leg up where I can. And that goes for whether I'm helping people in business or whether I'm helping someone believe in themselves or feeding the homeless in the streets of Miami.

So what's next for you? What's next to focus on?

I'm doing it right now. I mean, honestly, the consulting that I do, I love doing and I don't take pay. But sometimes some of the companies, they want to try to hire me and that's not, I'm not hirable in that capacity. I don't want to be someone's CEO, but what I do is I take equity in their company and then I take them to the promised land. So I do that with two to three companies a year. And so that's why I have that. I have a, you know, a portfolio of probably 10 different companies that I have an interest in. And so that's what I'm doing and that and Then living my life. I have balance. So, you know, balance in my personal life, my business life, my faith, family, all of it. I'd like to keep it all balanced. And when I, when I was working, Eric, I probably wasn't very good at that. I was so driven because I always felt, I always ran my company a little paranoid. I always felt like the other shoe was going to fall any day, you know?

Right, right. So, so the, so if somebody is thinking, who's listening or watching? And they're thinking, wow, I might be one of those two to three companies a year that, that, that, that Peter could help, how would they get in touch with you?

The, the best way without me giving out my, my personal cell number would be just to find me on Instagram, which is, which is Peter Underscore Town. Easy. Find me and then shoot me a message and just say, look, I was listening to this podcast or however they come about, and I look at everyone, I look at every message. Believe it or not, I've got close to 600,000 followers. I look at every message and people say, oh, come on, I do, I make the time. And I don't respond to everyone, but when one of them resonates with me, if somebody said, I was listening to this and I was inspired and I'm wondering if you could help me or spend some time with me, those are the people that I do. Right. I mean, I've had two of those today. They said, would you mind making some time for me? And I said, of course I will. And that's just how I say it. Of course I will. How could you say no to that?

Yeah, right.

I mean, you'd have to, you'd have to be a real ass to say no to that, wouldn't you? With all the blessings that I've had in my life, I mean, how can you say no to somebody says, can you give me 15 minutes? Of, of course I can.

I totally, totally hear you on that. I get, I get similar emails and things on social media and it's just part of the duty, part of the.

Responsibility, I think it is, you know, and even the Bible says, you know, for a lot that is given, a lot is expected. Right? So, and that's how I look at it that, you know, how this, how this youngest of seven, two room schoolhouse kid got to where he is today. I reflect about that often and I appreciate the life that I've lived and I feel like it's, it's my life, it's my obligation to leave this world with a Fingerprint, make an impression where I can and make it a good impression.

Peter, I've really, really enjoyed the call with you. Have really enjoyed meeting you. You sound like such a great guy. Look forward to hopefully meeting you in person. That'd be great.

I would love it.

Yeah, maybe, maybe in Miami. Actually planning a trip to Miami soon. So maybe if I hit your nine months. Right then there we go.

I'll be back. I'll be back in Miami Definitely by October 1st for sure. And I'm there usually, usually till the middle of May.

Cool. Very cool. Very cool. So just to wrap up, we have.

Each other's email, right?

Yeah.

I'll make sure that we get well after we go off the air. Let's get each other's cell numbers.

Yeah, that sounds awesome. That sounds great. Now shows call the 2%. The goal is to give people super practical things that they can use to help break free from that 98%. Join the estimated 2% of people operating at their full potential in work, in life. If you could share only one success secret with the world, one thing that could help someone break away from the 98 and join that 2% club, what would it be?

That's an easy one. First of all, I can promise you if you want to break away, you're staring down the barrel of uncertainty and a lot of sacrifice, big commitment. You're going to have those character building moments. So it's so important every day that you look in the mirror and you believe in that person looking back at you. That is absolutely key because in those moments of difficulty, you've got to believe that you're capable of powering through it. If you don't believe in yourself, you fail on so many fronts. So obviously believe in yourself. That's where it starts.

Amen. Self belief. Peter Touton, everyone. Thanks again so much, Peter. And yeah, really, really delighted that you come on the show today.

Yeah, I enjoyed it. Great questions too. And I'm glad I had the opportunity to share.

Share, yeah. Thanks a lot, Peter.

Right on.