Episode 92: What is Your "Enough" Number?

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Hey everyone, this is Julie. Oh, I'm the worst podcaster ever. I'm so inconsistent, but here I am and I got a great question today from a digital insider and I thought, you know what, I'm just gonna pop on my headset and record this as a podcast. And so the question was, what is your enough number? And this particular person said they think that they've always struggled with building this eight figure business, but then trying to align that with freedom and fulfillment and family goals, it just seems like such a risk to grow with a huge company employees to the eight figures. Does it even make sense? And so I thought, okay, well, let me answer this question because it's an amazing question. And I realized that as an enneagram6, I actually am not the typical personality type of an entrepreneur. So I will regularly see people on Instagram saying like, oh, I want to go from three to six, or I want to go from, you know, one to two or whatever their revenue goals are. And of course at Funnel Gorgeous, we set revenue goals, but we set them not because we're trying to like gun for some particular number. It's more just that we want to know that the company is growing. And so my enough number personally doesn't really have to do with my business revenue. It has to do with the number that will help me retire or stop working, should I choose if I need to, or I want to. So I actually work with Aria. You probably have heard me talk about him. He helps us with some financial, investing in things, and he talks a lot about this number because most people don't know what do you actually have to have in the bank or in investments in order to retire and live comfortably in the lifestyle that you're at now for the remainder of your years. And that number is really hard to come up with. I think for me, I would say that that number is about $5 million as it, you know, is, you know, divested into investments and some cash. But like that would be probably the number that I'm looking at. So once I know that I have $5 million invested in various places and accessible to me, I would say that's the point at which I could stop working if I wanted to, but I don't want to. So in the meantime, I just continue to grow a business that throws off capital that I can use to invest, knowing that I'm thinking, okay, it's probably going to take me how, you know, how many more years is it going to take me to grow that? So here I was answering this question and the reality is is that what kind of business do you Would you rather have a two million dollar business that throws off, you know, nearing a million in profit or would you rather have a business that's making 10 million and throwing off a million in. Prof. The bandwidth of a two million dollar business is very different than the bandwidth of a ten million dollar business. Now, if you are motivated by impact or volume or status or you want to like, have a, you know, a huge reach or you want to grow a big team, you might answer that question and say, I would like a $10 million business throwing off a million in profit because probably at 10 million I have the majority of people doing the work. I don't have to be, you know, doing all, wearing all the hats, so I'm comfortable with that and that's cool. Or you may say, ah, I don't want, you know, 50 employees. I want a two million dollar business. I want a small team of five or ten people and I want to be hands on in the business. Right? So these are the decisions that you're making. So now if it throws off a million in profit and you have to put, you know, whatever, 30, 40% into taxes and that's earning you, let's just say for easy math, about $500,000 a year. So if you're trying to get to 5 million in cash, right, you've got to live off of that money and then save it. So it's going to take you 10 years or so to build a business, to build enough cash reserve and investments to retire. And the average person retires at about 65. So, you know, that's kind of how the math works. Very macro, not very detail oriented. But so I have this unique vantage point of working with a lot of clients. So I can see in the back ends of a lot of businesses and understand sort of the lifestyle implications of those businesses. And so here's some things to think about. I'm not going to give you any answers of what is your enough number, but here's some ideas. The first thing is that Digital Insiders is my current personal business and that is a capped business. It will not scale beyond about $2 million a year. I do not want it to scale beyond that. I could grow it and change it and morph it, but I like it and it has been steady, a steady million dollar a year business. And as you know, I cap out at 100 paying members. It has grown, but that's going to be about a two million dollar a year business. It's going to have good profit margins and it's going to be an amazing way to spend my years working. Now the thing about that business is a full time 40 hour a week position, right? Because it's a small company, I don't have a big team doing everything. I'm doing a lot of the coaching. So just very, it is taking a lot of my time. So if I wanted to have a business where I didn't have to talk to a lot of people or I didn't have to spend 30 hours a week coaching through voxer and audits and hot seats and I would need to choose something else. Okay? Now Funnel Gorgeous is a completely different animal that has a coaching aspect to it but it's not a one on one coaching aspect. And then it has course sales and it's a more scalable business. And we've also been rolling into software that has a much larger team. Funo Gorgeous is on track to do about 4 million this year with about a 40% profit margin. There's also a second CEO so the, the capital it throws off has to get divided differently. Plus we have a lot more people on payroll. Okay. And the, the thing with Funnel Gorgeous is that there's a lot more scaling team, logistics, systems management and less of the, you know, heavy duty intensive coaching. Now the reality is, is that for the past couple years Digital Insiders and Funnel Gorgeous have kind of thrown off. At least in 2020 I would say they threw off about the same amount of capital. Yeah, sort of about that. So I can kind of feel from a lifestyle position what it feels like to have a Digital Insiders type high, high touch coaching business versus a Funnel Gorgeous where I'm more managerial and I do have a little bit of coaching, but still, what am I going for? Am I trying to hit some magic number with Funnel Gorgeous? No, we are trying to grow, we're actually trying not to grow too fast and it scares me to death to grow too fast. So that is not something I'm interested in. So when you're looking at your enough number, it is really tempting to just gun for some big number without the context. And it is incredibly dangerous because when you get to that number, you're probably going to be pretty disillusioned as to what it means because you attached a meaning to it that wasn't really true or accurate. So when you're sitting down and sort of building out your value ladder of your company and figuring out where you want to go, you want to start with that end number in mind of when do you want to retire? What age do you want to be when you retire? How much money do you want to have invested or in the bank in order to retire and then back into it from there. And then as you're building that business, thinking about the different containers that business can go in and you know, do you want to have a huge impact? Do you want to have big volume? Do you want to manage a big team? Do you want to have a smaller business? Do you want to have more intimate and deeper connections? So those are the things that I would encourage you to think about as you're trying to plan out your enough number. Anyway, thanks guys for listening and sorry to be so mia, but life. We got, we moved, we got a puppy, and there's been a lot going on in the land of funnel. Gorgeous. So. But I'm glad to be back.

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