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What would you recommend to the entrepreneurs out here that have books and courses and teach and do seminars and then people that don't have that, they're in brick and mortar businesses. Anything that would help them with building and growing their profits in their business?

I think one of the most important things when you're building any business is to decide ahead of time what kind of business you want to end up with. And for me, I never wanted to. I wanted to work three days a week and I wanted to have a 50% profit margin. And I didn't know how to do that in the beginning because I didn't understand direct response. And as soon as I started studying direct response marketing, and I think one of the most significant lessons that I learned was self funded, aggressive acquisition.

That's okay. The breakdown of what that means. Self funded, that's a good.

So obviously a lot of companies have outside funding or they have. They're willing to go into debt to be able to grow their company. I didn't want to do any of that. I wanted to fund my own company and I wanted to be able to grow fast. And that's tricky, right? Usually it takes a lot of money to grow or you grow slowly. And so I'm like, how do you do both at the same time? How do you grow fast and not take any outside funding? So I really started studying direct response and understanding funnels and ascension funnels. And Todd Brown is amazing. If you don't know him, you should. He has what he calls the E5 method. Todd, right? Yeah. Amazing. And so he had like my first aha. Business moment when I really understood that there's three ways that he describes acquiring a customer. Right? You can. And most people, when they acquire a customer, want to be able to get paid immediately on that customer. Right. That's like level one and level. Because they're basically like, I want to make a profit immediately. And I feel like if you. If you think about making a profit early in the. In the funnel, you're going to make less profit later is kind of how I visualize most businesses. And when I work with other businesses, that's what I see. And then there's kind of the second type of acquiring a customer where you can break even on that customer. And then there's a third kind where if you're willing to go into kind of the red on that customer, you can grow so much faster. Right. Because Dan Kennedy, whoever pays the most for a customer is going to be able to win. But how do you do that and maintain Cash flow and be able to fund yourself. And I remember thinking, so my membership site is $297 a month to join the membership. And my initial goal was to get 3,000 people in there. And I had this idea, what if. And then my back end is 18,000 for a six month certification program. And so I had this thought, what if I was willing to use all the membership money as just marketing money as just money to fund the marketing for the back end. And that was like a $12 million business. And it was just, I mean the money, how, how it's divided up, this was just kind of a mental construct for me. Right, right. But as soon as I did that, as soon as I was willing and you have to have your data dialed in order to do this, but as soon as I was willing to do that, my business just exploded. That year we went from 5 to 17 million. Okay, willing to do that.

So you went to 5. And how many team members do you have right now? Because this is a very interesting model. 20, 20, 20 people. And you're doing 50 million a year in revenue and you're netting. Yeah, I mean you, you're doing well.

Yeah, yeah, yeah, yeah.

So that mindset of being able to look at that pot of revenue that comes in as marketing dollars. What?

It's kind of crazy, right, to think about it.

That's actually very smart. Yeah, it is kind of crazy.

It scares people when I make that suggestion to them because that, you know, it's so interesting to me to talk to other people about money. Usually people making less money telling me that I'm doing it wrong. It's fascinating. But I, I, when I, when I read this work from Top Round, I was like, wow, like I had never thought of that. It's like if you want your money up front, right. And you want to be able to be able to cash it in, then you're not going to be able to fund your own business. You're going to have to get outside funding. And I just never wanted to do that. I want to be 100% owner.

Yeah, no, and we talked about that also when you're at my house a few days ago where like I have equity in, you know, over 20, 27 companies right now and I still, whenever I get a deck of people pitching me, which comes all the time, and now I'm like, I don't even want to even think about any sort investments for someone that's not in Genius Network because you have to meet with people and talk to people. I always Send it to John Raymonds. This guy over here, this dude, he's an impressive individual. He never brags, so I always brag about him. He sold his first company for $500 million. And then he's just a smart investor and just a nice guy. What's funny is this dude, compared to most info marketers, are always taking pictures in front of their stupid planes and which usually aren't their planes. No, no, you have a real plane. You own your plane. I'm talking about the ones that are using it as a prop, that they rent the plane for like an hour and then act like they have a plane. Those, those douchebags. But you know, the influencers of the world. But like, you know, John, he really, you know, he never brags about stuff. And the guys made more money than like most all those people combined. But he owns Bronze Studios, which is, you know, made the Joker movie, which is the highest grossing R rated film of all time. So John unfortunately has to get Dex sent to me where I ask his advice the most amateur questions. Because I've never understood, like whenever I needed money in my life, I just think of what can I sell where people give me money. It's hard for me to be like, let me go raise money. Because what I've learned more and more is like a lot of the people that are raising money, their story that they tell others and they tell themselves of these fantastical, exaggerated things, but they just haven't figured out the marketing. Now in some cases you need to raise money to scale. I get all of that. There's, you know, there's purposes in doing that. We're doing that in our VR company. Right. But the, you know, the fact is though, it's like being able to self liquidate. Those were the words that made sense to me. How do you create self liquidating advertising where it just pays for stuff?

Yeah, and it does really work.

And so a couple of ideas that I think are most applicable for us in this room. First is really to get out of your head what you pay people. We do these studies, comparative studies. I just spoke in front of 2,000 IT service companies last Friday and they're all out doing their studies so that we can compete with other folks in our space. Look, I think you have a very simple decision. Would you rather have less people paid more be smarter or would you rather have a whole lot more lower paid stupid people? I really think it's the fundamental decision we make. And if you're familiar with the Container Store, they've always believed that one good great employee replaces three good. Steve Jobs always thought the ratio was 20 to 1, 50 to 1. Bill Gates always saw it as 10,000 to 1. One great programmer can replace 10,000. And so I think a key number if you're achieving what Brooke was able to achieve in terms of revenue or gross margin or profit per employee, when you're at her numbers with 20 employees, you can take what off the table? Compensation. And so our partner Andy Bailey Telecom stories it's not Facebook or Google, but when he started with our habits in 2004, he was averaging about 75,000 gross margin dollars per employee. We think that's the key number. By focusing on that, he was able to quadruple it four times his industry. When you've got that, guess what, you can compensate your people a lot more and still take more to the bottom line. And so what we're seeing is that it's fairness, not sameness. I think that is the most unequal thing. And if you look at sports teams, let's just take one position on a sports team and they might have five or six that play in that position. Does everybody that plays right tackle make the same amount of money that plays quarterback in any one of those? No. And if you look at the delta between first string and second string or third string, if you look at the violinist there in the orchestra, the Delta is tremendous. And so rule number one is, what's the first thing? If you've got any kind of number of employees, people come into and ask, I would like a career path. What is that code for? How do I make more money? But here's your issue. You don't have places for them to move up to. Brooke doesn't. And we don't want to be putting those layers in. The large companies are stripping them out. And so the first thing is you've got to have super wide pay bands. People have got to be able to make two to three times what where they started in their same position but with key metrics that are driving that. So I want to take to my buddy John Summers in Allied Printing. Look, this isn't Facebook or Google. This is commercial printing. But his customer service reps who start at 48,000 can progress through a series of. And by the way, we think you ought to give people titles that start from beginner to wizard to maestro. Seven ways that they can get promoted in their position. They start at 48, they can finish at 96. Folks managing print projects come in at 68 and can make up to 140 salespeople start at 60 and can make up to 600 a 10x. And so first you have super wide pay bands. And is it clear what are the things they need to achieve in order to be able to accomplish that? So you take the pressure off people saying hey, I need a career path. Then we think it's critical to gamify games. I just want to share a story. So we get. I think it's the casino industry that understand the psychology of humans better than all of us combined. They have figured out how ways to get humans to sit in front of computer screens where we're just trying to get them to come back from break. I mean, have you been to a casino? Folks don't even want to pee. If they could pee right there, they would, right? They want to be served up for food. And by the way, you're having trouble having people work all night. It's not an issue at casinos. And which way is the compensation moving? And so I'm like what has that industry figured out? So we get called into HSN and they're call centers. We're just trying to get folks to upsell. They've got this whole pile of money they can't give away. And so what we did is rather than give money, we said let's give people chances to get movie tickets, dinners for two flat screen TVs. We had enough money, we parked a car out in front of the call centers. And the result, if we promised it, we never got the contract upselling increase. Not 16, not 60, but 260% as a result, just by gamifying the results. And last then I think it comes back full circle. So I just wanna share one quick idea that again we got from John Sommer and it comes back to bonuses. And so first of all, I don't think bonuses ought to be paid off paid out any more than once every year. Sometime way after the end of the year, if you pay it out quarterly, it feels like what part of the regular compensation. And so it starts to become like an entitlement. But here's what John does because he already pays people fairly and they can make twice as much and they know how to do that within their existing position. His retention in that industry is crazy. And when you're making twice what everyone averages in the industry, you've got it right and out of sight. So John's got the base and all of that figured out. So what he does with the bonus is he only pays out 50% sometime after the end of the year. And then the other 50% vests over the next five years, 10% in each of those buckets. So as people stay, what's happening to that future buckets? They're getting bigger. And so now we play to Robert Cialdini, psychology people do more to avoid a loss than to get a gain. And so I've got to think twice, am I going to leave and leave five years of increasing buckets of money, which by the way is you're doing employees a favor. First, two reasons people also leave. You make me work with stupid people and you make me do stupid stuff. And what we want as a company is if we have great people, I want you to retain them. You lose a good person, it's hurting everybody around. And number two, a lot of your folks don't have savings. That's one of the real tough things. Even those that are high paid now, they've got five buckets of money that are building out to maybe pay for college, pay for that down payment on a home or whatever. And a company is going to have to offer a huge signing bonus to make up for five years of vesting bonuses out to the future.

What's the pros and cons of self publishing versus going with publisher?

So I mean, so the pros of going with a publisher are that, well, let me put it this way, almost 100% of all self published authors that are successful end up selling their book to a publisher. And the reason why is the publishing business sucks. And if you're a successful self published author, you're going to be making way more money in other parts of your business. No matter how successful you are. If you're making a million dollars on your book self published, you could make 10 million on things that don't involve printing books, shipping books, getting returns of books, getting them out there. So in the end everyone ends up being almost everyone, I shouldn't say everyone, but almost everyone comes to a publisher if they have success. But the advantages of self publishing is if you don't have this platform, you don't have the audience, and you want to use a book to build it, then self publishing is great. Because you're out there, you're getting it going, you're becoming an expert. Because one great thing about books, even self published books or traditionally published books, it doesn't matter. It helps give you credibility that you're an expert at something and it helps you get exposure. You can do podcasts to talk about your book, but most podcasts don't want you to come on and talk about Genius Network. And, oh, all you people listening to my podcast, give me 25 grand. Come to my networking. You know, they don't want that. But if you have a book and you can help their audience, they would love for you to come and talk about that. Then naturally they read the book. They go, I love this Joe guy. I'm going to go check out his website, and maybe I should come. You know, and it's been proven. I mean, Dan, he keeps track of this stuff. And I know, like, we did the first book, and then we're then the who, not how. We did first. Then we did gap in the gain second. And I was doing an interview of Ben and Dan for the second book. He goes, oh, by the way, you know, I've been keeping track. And I think we're like in seven figures of people that read who not how and signed up, you know, and him saying, I think means he knows damn well that we made 1,432,000 on that. But anyways, so, I mean, it just shows you, like. And I think that's what the thing that books can do for you is it can really help grow your audience, and it can help grow it beyond people that you would never even think.

Right.

Like, so. And it's just amazing what can happen with a book. And you don't even know. Like, yours is three days old, so you don't know this yet, but next year you're going to say, oh, my God, Like, I got this amazing letter. I got these people that came to Genius Network. I would have never even a million years met them, but someone gave them my book. And then the other thing that you said earlier, which I want to emphasize, is that you said that writing the book was a big thing for you personally. Very, like, writing it and finishing the book. And that's very, very, very common, that the feeling you get when the book is done is almost worth the whole entire thing.

Yes.

And that doesn't matter if you're just an everyday person that wants to do it for your family or you're like, all of you building a business and all that sort of thing. The feeling of getting it done and the accomplishment. I always say it's like the accomplishment of climbing, like, Mount Everest or something like that. It's not easy to do. So the big thing is there's authors and there's writers, and the author. And the writer doesn't have to be the same person. So that's the big thing right there. So the author is the person with the ideas, the Thoughts, the things that they want to share. And sometimes the author and writer are the same. Sometimes you get someone to help you write it and you talk about it, but it doesn't take anything away. Like probably 50% of nonfiction books are written by other people.

Yeah.

And so sometimes they give credit to the people. Sometimes they're called ghostwriters for a reason because no one knows that they wrote it for them. And lots of best selling books that all of you have read, you don't even know that someone else wrote the book.

Well, yeah, people would be surprised how many books they think are amazing by authors that never wrote them.

Right, exactly. And very well known that all of you guys would know. But the. So that's the big thing that you have to do. But anyone that has like an online course, let's say you have a book ready, you just have to take that. Of course, the way you talk and the way you write are different. You have to convert that. If you can do a weekend workshop. So like you're a great speaker, you can do a weekend workshop. You can easily. You have a book right there for sure. Because that's like 15 hours of content. That's more than enough for a whole entire book. Like especially if you talk the whole time. But if you just do exercises and stuff, that might not be enough, but you get the idea. And then anyone who works one on one with people and does things like that, you have the knowledge for the book because you know what works and doesn't work. And that's what we love, like at Hay House too, is people that are out there working with people. Like people that are around doing different things, changing things, seeing how it affects them. Those are the best books because it's not just your philosophy, but you see that people put it into practice. It's like Dan, he doesn't just sit around and think of these ideas, he teaches it. And then he says, oh, wow, these people's business did better. Maybe that was a good idea. I'll keep that one. But I'm sure he had a few that didn't work, you know, and he keeps track of those and kicks them. Goodbye. And that's the same with all of you. As you're building your business, some things work, some things don't. And when you share that overall experience, the more experience you have, the better. It's like the saying of, it takes 10 years to be an overnight success. You know, like that's so true. And even for Hay House, it was the same. We had our first best selling book in 1988 and our second best selling book in 1999. So 11 years. And then every year since 1999, we've had at least two or three bestselling books and sometimes as many as 10 in one year. But it took us 11 years to figure it out.

Hey, I hope you're enjoying this video. And I want to let you know that I have a new book that's come out and if you'd like to get it absolutely free, there's a link below in the description. Or you can wait till the end of this video or you can Simply go to joesfreebook.com and you can get a copy there.

So our firm, I lead a firm called Bigelow, which would be most widely known for being the merger and acquisition advisory firm that deals exclusively with entrepreneur owner managers. Those are high performing private business owners. Half are founders, half are family businesses. And usually, Joe, where they start a conversation with me or with us is asking the question, how do I get my business to succeed beyond me? How do I get my business to succeed beyond my personal ownership of it? So Barbara And Ed Wilson, 35 years ago were teachers in Northern Massachusetts who were tutoring kids, dyslexic kids, how to read. And they realized that they had a way that they were teaching dyslexic kids how to read that was having better outcomes than anyone else that they knew about. And they had a moment where they said, my gosh, if this is true, we actually need to teach teachers how to teach dyslexic kids how to read so that we can 10x what we're doing. And they formed a company called Wilson Language Training. Three years ago, Barbara and Ed came to me asking, how are we going to have this business succeed beyond us? Because now we're in our early 60s, we really wrote the curriculum. We now have a thousand employees. If the business is as valuable as you say it is, wise guy Pete, then it's too valuable for our employees to buy. What are we going to do? And how are we going to make sure that the business succeeds? For the long term? No, for the really, really long term. And so, Joe, that's why we start with the destination in mind. Because if those of us in this room who are business owners, like all of us, could start with the thought that might we want to have a capital gain someday. You don't have to be interested in selling your business to want to optimize enterprise value from increased enterprise value in a business. All good things come if you want to Have a bigger success sharing plan for your team. Build enterprise value. If you want to have enough capital to go to the bank and build a wing on your manufacturing plant, Build enterprise value. And building enterprise value is knowable. Which is why I wrote Enterprise Value the book. Because I had so many friends who came to me and said, oh, Pete, if I'd known then what I know now, and I would say, actually we could have known then what we know now it's knowable is not rocket science. So that's what I mean by starting with the end in mind.

Great.

Let me ask you this question exactly the way I have it here. So when it comes to entrepreneur owner managers, why should they build enterprise value? And what do you mean by that term, enterprise value? And we went, and I'm asking this question because there's a lot of stuff and you have a couple slides I want to show people and have you explain it, but I want you to define what that means and then maybe describe the, the slide that you have. The arc of the entrepreneur, owner, manager.

So most of us and all entrepreneur owner managers, actually that I've ever met, with a few exceptions, really didn't start their enterprise to like start up, to sell out. They identified a niche, they had a unique ability in the niche and they began to develop something, a product or service that provided great value to their customers in the niche. And over time, as they did that, they created great value and the enterprise value grew. So what I mean by enterprise value is the gross value of the enterprise. And we can talk about some rules of thumb of how to measure that. And we typically, those of us in this room typically only measure it like once in our lives, right at the end. But we would do well if we sort of thought about what are the drivers of enterprise value in our domains, in our industries. Are we interested in knowing that? Do we want to optimize those drivers of enterprise value? Because if we do, it ends up with a more valuable enterprise to everyone, to ourselves, our employees, our families, our customers, our communities. Today there are thousands of private equity firms, each of whom has raised more than $100 million to invest in private businesses. There is not an abundance of capital in our world. There is a superabundance of capital in the world. Public companies are brimming with cash and have paid off debt private equity firms have raised, according to Prequin, which keeps the statistics a trillion dollars more than they have invested. So this is a wonderful time to be thinking about how the power has shifted from where I started my career. The Power was with the capital providers. The power has now shifted to you. What the capital providers have is a commodity and you can rent it at the same price from any one of them. And what you have, which is a superior performing private business serving a niche, is what is rare and valuable. So I really hope you can make this change of this mindset that it's what you have that's rare and valuable. And that's why someday we ought to be asking the question, is there an investor out there who deserves the opportunity to be a majority owner of your business? So it's not about like selling the business. And I would ask you all, ban those words from your vocabulary. You're not selling anything you don't have to. If you're a good business, you know, you get two or three overtures a week. Some of them are from business brokers who don't represent anybody, but some of them might be actually for real. So I would just urge you that we're in this environment where once in a while we run up against an entrepreneur who says, geez, I feel kind of guilty. I'm in my 60s, I've created something of great value. What are people going to think of me? I would just ask you, since we're in this time of abundance of capital, go to the right hand edge of the slide and ask yourself, what's in your next chapter? Brooke Castillo yesterday talked about unlocking your potential. And it seems to me you can't unlock your potential if you keep holding tightly onto what you already have. So we ask our clients, what would you like to do in your next chapter? There's a woman who owns a business in central Pennsylvania that we recently completed a successful engagement with. And she told me the story of how she. I told somebody this the other night at a dinner here that she, her father was diagnosed with a terminal illness and her mother called her at graduate school in Chicago and said, can you come home to help? And she came home to help. She thought temporarily. And her father's business had nine employees. Today it has between 800 and 1,000 employees. She's been running it for 31 years. She makes high tech castings for nuclear submarines and nuclear aircraft carriers. And I asked her, so Jan, why now? Why not a year from now or why not a year ago? And she said, who said, this is supposed to be a life sentence. She said, like, I got some things I want to do. And so we started our businesses as entrepreneurs because we were seeking freedom. And sometimes along the way, we give up some of that freedom and our responsibility to others. And this might be a way to get your freedom back.

Okay. I hope you found that video awesome and useful. So if you want to get a free copy of my book, I want you to click here. And if you want to watch some more videos that will be useful and awesome, click here. Go ahead. They're over here.

Do it now. Come on. Thank you. Watch them.