Experienced People Only: You Don't Want MRR. You Want LTV.
In this monologue, the speaker critiques the common focus on Monthly Recurring Revenue (MRR) for coaching and consulting businesses, arguing that it creates volatility, emotional stress, and limits growth because losing a few clients can cause significant revenue dents. He proposes Lifetime Value (LTV) as a superior metric, emphasizing that businesses should aim to extract the maximum value from every segment of their audience rather than only the high‑ticket 5‑10% who can afford recurring, expensive offers. By segmenting the audience into multiple price tiers—cheap one‑time, cheap recurring, expensive one‑time, and expensive recurring—the speaker demonstrates how to capture revenue from the broader 90% of the market. He introduces a practical framework of four offer templates that he cycles through to stabilize income and continuously engage different audience segments. The talk also covers the importance of backend upsells, showing that many high‑ticket clients first purchase low‑ticket products, and how a “validation equation” can safely test new offers on a small group before a full launch. Throughout, he uses analogies (e.g., gym day‑passes) and provides actionable resources, including Google Doc templates linked in the video description, to help viewers implement an LTV‑focused strategy and move beyond the limiting MRR mindset.
Chapters
Today we're driving through the streets of Alicante. I just had something hit me about MRR, and MRR is one of the most beautiful things in the world. Like, who doesn't like MRR, right? But I believe MRR is, uh, it's overrated. And I believe that there is a better focus if you run an MRR-based business than MRR, because it can be very limiting and very stressful when you focus on MRR. If one client leaves or if you don't close a client, it is very crushing. It's like, maybe not one, but two, it can make a significant kind of dent in your business. Three, four, then it starts really hurting, right? It stinks. And the nature of coaching and consulting businesses is that you kind of always have to be getting more people in, because if not, the business kind of dries out. So to me, like, when I I reached a million, I kept promoting my stuff. And I'm still at a million, but I'm still promoting it. Logic would say, well, then you should probably be above a million, right? But the thing is, entropy is a real thing. Like, you never really maintain a business. Like, business always either shrinks or it grows. Like, it's always gonna do either of those two. The fact or the belief that it's gonna be stable and you're gonna stay at one stage That's just kind of a fairy tale. So it just doesn't happen. You either shrink or you grow. So that can be very stressful for the entrepreneur because as humans, as humans, what we want is stability, right? We want something that's like always kind of there, right? We don't want to be kind of guessing. So what is the solution there if not MRR? Because MRR is highly volatile and if you attach some sort of emotional kind of soulless to it, then it's probably gonna crush you. I believe LTV is a much better focus, and I'll tell you why. So LTV is lifetime value. It's how much you make from a certain individual or person or whoever you sell to, right? Now, why do I like focusing on LTV more than MRR? Because if you notice, if you really think about your offer, it's probably high ticket, it's probably something recurring, and It's not the cheapest thing in the world. Now, what is the amount of people that can afford that, or what is the percentage of people that can afford that in your audience? That's a very small percentage, maybe 5%, 10% if you stretch it, of the audience who can really afford your high-ticket services. So if you're talking to only 10% of your people and your whole business model depends on monetizing the 10% of them, the people who follow you, Well, then what happens to all the 90? That's a big chunk. Like, that's just a big chunk that you're missing out on that MRR kind of blinds you to and confines you to. So I'm not a big fan of focusing on MRR because what about the 90? What about everybody else, right? And while there may not be thousands of people willing to pay you thousands of dollars inside of your audience, there very well may be thousands of people willing to pay you hundreds. In your audience. So then if you focus your mind on, let me not try to get as much MRR as possible, but extract as much LTV as possible, then the game changes. You stop thinking on how do I get more clients? And you start thinking about how do I get the most out of the audience and meet everybody where they're at? Some people, like, let's just call it their wallet, right? Their wallet is open to you for maybe $500, $600, $700, right? And if you only sell that one offer, then you miss out on maybe it's 20%, 20% of your audience paying you $700. It's not a bad deal, right? And so on and so on. MRR has got a big focus because it is the most emotionally soothing metric that we can focus on. It soothes a lot of pain, but it also creates a lot of pain because when you lose somebody, it stinks. Now, if you focus on LTV, it doesn't sting as much, and you actually make more money. An example of this is I'm just coming back from the gym, and at the gym I have a membership. The Ukrainian, my wife, does not. Now, she goes there maybe once a week because she's a runner, she loves to run, and, well, her gym is the outside, right? But every now and then she'll decide to do some strength training with me. Her focus is on Well, the gym's focus is not on getting as many clients to stay there as possible. The gym's focus is on LTV, and that means that they make more. Why? Because they can sell her a day pass. Now, if she goes there once a week, I did the math, the day pass prices would end up being as much as if somebody committed to the gym for 6 months, over a year. So they're getting 6 months of money out of her, out of me. So that's a lot of, that's a lot of money. That's somebody who's staying for 6 months. Now imagine if she shows up to the gym and then she wants to buy a day pass and the gym goes, no, you can't do that, sorry, impossible, because we only take committed people. You have to commit to this, commitment or nothing. Well then, that's kind of a big waste because what about the 6 months she would have ended up at? But the gym doesn't do that because their focus is on LTV. They want to extract as much from as they can from the people that come through the door, and then they sell like the waters, and sometimes they make another deals and so on, because they get it. Like, all businesses get it. They understand that some people are here for a long time, some people are here for a good time and a short time. So it doesn't really make sense to only sell one offer. As a gym, a service provider, you make a lot more if you focus on how do I meet people where they're at, how do I extract as much from their wallet as And MRR is just one of the ways that they do that. Subscriptions and commitments is just one of the ways that they do that. Another way to do that is maybe somebody's just gonna show up once and you can sell them a water. Maybe somebody's gonna show up once a week and then you can sell them a day pass. So if you only have one offer with one pricing modality, one saturation, and one promise, you're only talking to the 1% literally of your audience who can't afford it, but the other huge chunks you're kind of missing out on. You're saying no to the wives of dudes who just want to train once, but maybe they'll do it plenty of times. And that's what an LTV focus does for you. And that was a big realization for me, and it was difficult because I didn't want to let go of the MRR focus again because it feels so good. It is a very soothing thing to see MRR grow. But as your business grows, you also have to grow, and you've got to understand that sometimes the metric that got you here won't get you there. And an LTV-focused mindset was honestly freeing because I was okay, and I didn't mind with just varying my offers because I understood that the minority of the audience who are the kind of people that I would like, and they would like to work with me on a client basis is a minority. And so if you look at your audience not as one entity but as an infinitely segmentable entity, the amount of possibilities that open up to you is, is fantastic. Because imagine if you put that one to rest for a little bit, you put your main offer to rest for a little bit, and then you think, how can I extract the most from all the other guys? And then you do that. And then if you're smart about back end, how much more could you make in the back end off of that? And then you can keep promoting the same offer you've already been promoting. And because you didn't promote it for a while, then by the time you bring it back, well, it's gonna hit harder, right? Novelty is a big aspect of why offers work. An MRR-focused mindset doesn't get you that kind of thoughts, doesn't make you think about all the different possibilities. It makes you iterate over a very small set of variables, which is your one main offer. And that is very limiting. And that is why you keep trying angles and durations and posts and certain, I don't know, VSLs, and they're not landing. It's because you keep talking to the same 1% of the 1%. And it's not that the audience is dead. Audiences are, they just don't die, right? Like, it's just that the segment has seen your ad and your offer so often, and there's so little of them because of the nature of high prizes and recurring commitments that they're just kind of tired of it. And maybe the best thing you can do for that offer is just to let it rest for a little bit and then focus on getting everybody else to give you money because they're literally been thinking about it. You just haven't made the right modality, you just haven't made it possible for them. But if you did have an LTV-focused mindset, which was honestly one of the most freeing things I did for my business, then you open up that door. And I saw this post the other day that said cheap offers attract cheap people. And yes, but that doesn't tell the whole story because expensive people also buy cheap offers. Like, just because somebody buys a low-ticket thing, that doesn't mean they're a low-ticket person. Maybe they're a high-ticket person, but they just needed to see a little bit of you in action. And maybe this is why you run sales calls, and once they— you get them on a sales call, it's an easy close. It's just getting them on it that's hard. Why? Because sometimes people just need to see you do your magic in order to understand, oh, I like this magic. I like what this guy's got to offer. And then it makes sense to jump on the other thing. So not only like the things that LTV-focused mindset gives you are not only you get a lot more from your audience because you're tapping into this huge like segment that you just haven't made an offer to and they miss you and they're ignored and they're like, please let us give you, let us give you our money. It's just not that way. And instead, you change the way they give you money, and they'll be open to it. So that is the first thing it gives you. And the second one is the opportunities that that opens up in the back end are fantastic. 80, maybe it's 85% now, of the people who work with me on a client basis have bought something small from me in the past. I wouldn't have offered that if I was just focused on MRR, because I would think, what's the point? Like, digital products, you just sell a small thing? Like, that doesn't scale. Right? Like, it's just a small thing. I want MRR. Well, don't think like that. That limits you. MRR-focused mindsets limit you. LTV-focused mindsets free you to understand that everybody in your audience is willing to give you an amount, and your job goes from trying to figure out how do I make my offer better, make it more irresistible, and it goes towards what else can I offer, what can I change, what can I tweak. And there's multiple ways to do that. It doesn't just have to be about the angle or the VSL because you're only changing kind of the surface level stuff. If you change the core of it and you think there's people who are willing to meet me at different prices, at different durations, at different promises, at different modalities, at different kind of payment plans, man, the possibilities are fun because then you open yourself up to so much more. Like, you got so far to the point where you are right now just selling one offer. What have you opened up for? And all the different avenues open up to you. There's a lot to be done there. So me personally, I like cycling between— what are they? They're 4. So there's kind of cheap one-time offer, there's a cheap recurring offer, there's a, there's a cheap one-time, cheap recurring, there's a cheap, there's an expensive one-time and an expensive recurring. So those are those four. And I've got these four templates that I kind of cycle through. And that's all I think about. I don't really think about how do I tweak certain offers, the VSLs, the templates, the angles. I just kind of cycle through them. And I know that if I keep cycling through them, that's what creates the stability because I'm constantly tapping into different segments of the audience. And that's why I give those to my clients I'm like, just use these and don't really think about how do I make this offer better, tweak it, change the VSL because man, like recording VSLs is such a pain, frankly. Just cycle through them and that'll extract the LTV from your audience. MRR is a focus that's good. It is really good and it will take you far. LTV is kind of the next step. It's when you really understand how business business in the backend is much more powerful than business in the frontend. Like if you're only depending on the first sale, then all the backend sales, like you're just kind of blind to it. It's just something you don't think about when you focus on MRR, but in LTV, it's open up to you. So these 4 templates, they've just been great for me. Like every time I cycle through them, I realize and I found somebody new that I'm like, I didn't expect this person to buy. I haven't seen this person. And naturally, because they just weren't— the offer I was making to them, maybe the offer and the promise was right, but the duration, the pricing, the modality, how easy it was to start, maybe it wasn't. And then I've got clients that started all the way from nothing to the highest thing. I have clients who started on one of those three and then upgraded. I have clients who stayed on one and they stayed there forever and they pay for the year and then another year and, and so on. So I gotta go softer on these— what do you call it— speed bumps. And so if you have different avenues, it's exciting. Like I say, it's, uh, it's hard to fill a stadium with only one door. So, and you've got a pretty full stadium, you've already got some clients. So what would happen if you open more? That's what I think about. So these 4 templates, uh, they're all available. Like, I give them to my clients whether it's high ticket or low ticket, they can have them. So if you go to the link in the description, there is a link to the tool tier. Inside of the tool tier, you're gonna find all 4 Google Doc templates, and you can swipe them for yourself and use them. So if you find those helpful, and if you think about the possibilities that that could open up to your audience, then you might be— you might want to use them. There's also some ways that you can test them in case you don't want to kind of do a big launch, because sometimes Sometimes making big launches and changing— Jesus— and changing some things about your offer can be scary about the way your audience perceives you, and I agree. Like, you need to show up with leadership to your audience. There's inside of it, there's the validation equation. That's another lifesaver because it allows you to test your offer with a very small segment, and only if it gets wings, if it has legs, then you promote it to your entire audience. So there's ways for you to test and iterate on those things for cheap with like really small— so you don't have to change anything about the way your business works in the front end. You can just do it in private, and then if it works, then by the time you send it to your entire list, now you have an offer that works and you never really risked anything. You were never in danger. Everything was done safely. So yeah, you can go to the tools here below, cancel anytime, unsubscribe anytime, get them, and, um, profit from See ya.
