Chris Lee | Mastering Business Identity and Growth

You're tuning in to Candy Crush music season with me, DJ Divine. Sweet. We've had a request from Tiffy to drop the new Thundercat track Upside down. Delicious. But you can do more than just listen. Go to candycrushupsidedown.com to swipe and pop the music video from November 3rd to December 7th. Selected players Level 36 terms apply. See in game optional in game purchases. Businesses need to focus on keeping their identity. Their identity. What do you think about that?

You are not in competition with anybody that you think that you are in competition. The only competitor that you have in any business is the pain that you are solving. I want to impact 2 billion people through the message of we can change this world through entrepreneurship and this is the exact fabric and the exact recipe to doing so. Doing things to impress other people is the detriment to any business.

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Ladies and gentlemen, welcome to another exciting episode. And today we've got a banger. We're diving into the mind of a true business strategist who successfully scaled and grown multiple businesses. But not only that, I've told him this offline. Of the five podcasts that are in my rotation, his is number one. Ladies and gentlemen, join me in welcoming the mesmerizing, the tell the truther, Mr. Chris Lee. Chris, how's it going, brother?

Let's go. Excited to be here. Thanks for having me, Mick.

Dude, you know I was telling you offline. As a podcaster, it's weird. I don't listen to a ton of podcasts just because I like to keep myself fresh and I don't want to be swayed by anything. And a lot of people out there like, well, what do you mean? It's just, you know, there's so many great podcasts. So it's not like I don't listen to podcasts because there's not a lot of good ones. It's just I never want to hear something and then talk about something someone else has talked about. Right?

Absolutely. But Chris, I hear that.

I freaking love your show. I freaking love the Founder. It is by far my number one podcast. And it is actually, and I shouldn't say this out loud, but I'm gonna look you in your eye. I love it because you talk about things that I enjoy. And when I call you the Tell the Truther, it's because you don't hold anything back, bro. And that's why I'm excited to have you on. So, one, I just want to thank you for being the great human that you are. And two, honestly, being kind of like that role model for me in this space because I'm six months into the space and you're, you're the person that's like, I want to be like Chris. So thank you, brother.

I appreciate that. That's. That's a very, very kind intro. So thank you.

I appreciate it. So, Chris, we're going to roll, man. Like, on my podcast, I like to talk about your because that reason that drives you deeper than your why that thing that makes you do what you do. And, and listening to your podcast for as long as I have and kind of following you a lot, I kind of got a glimpse. But I want the listeners and viewers to know. Chris Lee, your. Because is.

Yeah, absolutely, man. So I, A long time ago, I realized that money wasn't my motivational driver. And it's really when I made that shift that I started making more money than I knew what to do with. And, you know, a big, big believer that money chases value, and that money is one of the very few ways or one of many ways that you get paid. And, you know, I'm, I, I love anything that brings me energy. And my, because my why is I have found something that changes the lives of people and I want to share it with the world. And what I have found is that the way that we can change society. I look around me and society is deteriorating, right? I see politics, I see wars. I see arguments over religion or the lack of God in so many areas. I see the family disintegrating. I see our education system completely just annihilated and AI's coming in and taking over and all these different things, right? So this is what, this is the current, the state of the union, right? In the day I live. And what I realized is that the way that we change it all is through entrepreneurship and entre and, and not just in making money, right? Like making money, yes, has to be a fundamental barrier of entrepreneurship, otherwise you can't continue to influence. But if we want to change society, the entrepreneurs are the ones that have to do it because people have stopped listening to the politicians, people have stopped listening to the influencers and actors and actresses of, of the world and everything else. And, and what we have in our power as entrepreneurs is people come to work for us for what they perceive to be a paycheck, right? They. They come in and they're like, hey, I'm going to get paid. I can pay my bills. Fundamentally necessary to everyone. Everyone has to provide in some shape or form so they come in. And as entrepreneurs, because we have that control of cutting the paycheck, we can influence so much more. And what I have found in building my businesses is that if I focus on more than economics, if I focus on developing my people physically, economically, with their associations and their relationships and their spirituality, I can fundamentally change the fabric of society because I can change these humans into something. They come in, they think they're going to get a paycheck and they leave and they go back out to the world and they start serving and they're better well kept and they provide real value and they look for opportunities to be better brothers and sisters and mothers and fathers and. And so that is really my why I want to impact 2 billion people through the message of we can change this world through entrepreneurship. And this is the exact fabric and the exact recipe to doing so. Because when I, when I figured that out, man, I could blow up a business. I could become the sixth fastest growing company in the United States, 1100 team members in under five years, and sell my business for nine figures because people were bought into becoming the best versions of themselves.

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That's one of the 1200 reasons why I love you brother. Like that in and of itself is enough, right? Like that should be why everyone does what they do. Every entrepreneur, every business leader. That should be the reason. But for whatever reason, man, I feel like people miss it. You get to a certain stage where it becomes less about the team and more about me. And I see that as a huge mistake. From your experience, what are some common mistakes that you're seeing in the entrepreneurs that are going from, I'm going to say two to three years past startup to really getting ready to scale and then they can't ever get there?

Well, one, they, they work for money, right? Like they're, they're there, they become a slave to their job they're actively involved in instead of focusing on their people, right? Like there's three importances when running a business. One, you got to take care of the business. The number one priority to any entrepreneur is allegiance to the business. Most people have allegiance to themselves. They have allegiance to impressing other people, trying to look good, trying to appear success before they actually are, right? Like doing things to impress other people is the detriment to any business. One, do not do anything to impress people. Do things to take care of your business. That means charge more, pay, pay fairly, not necessarily less, but definitely don't just try overcompensating with, with giving more incentives of cash, right? Pay in other ways besides cash, pay in culture and development and really focus on the whole human. So like that's, that's like priority number one, take care of the business prior to number two, take care of your people. When you take care of your people and develop them out, they will take care of your customer. And so the customer isn't always right, but the customer will always be taken care of. As long as the businesses is in good standing. The employees, your first customer are being treated the way that you want to develop a perfect society. And then they will take care of your customer. And so I think, I think that's where most people get things wrong is they, they flip that script, right? And so ultimately the business struggles and fails. The margins aren't there, they're not doing things that are, are strategically best for the business. And so, and Then and then on top of that, kind of tying into that whole thing is typically we rob growth capital from our businesses to fulfill our own ego. And, you know, because we would rather appear successful than be successful. And so instead of taking the money that is profits and diving it right back into marketing, sales and growth and people and everything else, we're like buying the watches and the cars and the house and say, look how successful I am, making a half million bucks a year.

Yep. Matt, I want to unpack and unplug two things that I totally agree with you that you just hit on that I want to go deeper. The first one, wholeheartedly agree. The businesses that I work with, when it comes time to looking at margins, and they're like, nick, you know, I can't necessarily afford to give this raise, or I know I need to bring more people, but I can't. And then I look at their pricing structure and I'm like, well, why don't you just charge more? Right? And then they're like, well, but then I might lose customers. Like, dude, you know, subway had this $5 foot long thing that we all saw the commercials for. I went into Subway and I couldn't find anything for $5. I couldn't find a bag of chips for $5 at Subway because everyone understands you have to charge more. If you look at the history of any pricing, it changes and it changes constantly. But why do business leaders and owners get stuck in a concept of these are my prices in their fixed and I can't do more?

Well, fundamentally, it goes back to what I brought up before. They do things to impress other people, including their customers, right? So they keep their pricing structure because they want to impress. They want to appear like we are the best deal. We are this, that and the other. Once again, that's flipping the script and taking care of the customer first rather than the business. The business has to be taken care of first. Charge more and provide more. Like that is. That is the fundamental, like, foundation of any business. If you are not charging enough where you can in turn take care of your employees and. And in turn take care of your customers, you're going to have to cut corners. Like, there's only two ways that you can do business. Only two ways. You either got to be the most expensive in the marketplace or the cheapest in the marketplace. Okay? Anything in between, you're absolutely screwing yourself. There is a cheapest model that works. It's a Walmart strategy. You walk in, there's butt cracks and low expectations, right? Like. Like that that is, that is fine if that's your model. If you want to butt cracks and low expectations and but you and you better be super efficient in your processes and procedures and not invest anything else except for in that the customer experience has to be completely wank, right? Like whatever else. Yes, you can be the low cost provider. If not, you better be the high cost provider so that you can afford to make mistakes, you can invest in the customer experience. You, you can afford not to cut corners. You can pay the highest wages of people that are going to go and treat your customers with love and respect and everything else. If you're in the middle, if you're in the middle trying to deliver that top tier product, you are absolutely screwing yourself. If you are focused on the customer experience, go and be the most expensive because that's what people expect to pay for the best experience. There's a reason why the founder of Louis Vuitton consistently ranks in the top three richest people in the world. It's because he's figured out this pricing model. He's figured out that he can sell one bag with a gross margin of 98% versus the Marshall's same shaving kit, right? He can sell a shaving kit for 500 bucks that cost him $30 to make versus the Marshalls shaving kit that cost $20 that costs them $15 to make. So here's the crazy thing. He spent twice as much on the product to make it just that much better. But because he spent that much more, he can go and charge 25 times more than what the person did by only spending $15 on the. On the actual product. But then on top of that, the because you have these extreme gross margins, I can give you a personal shopper, I can give you the highest end retail space. I can give you everything that you come to expect when you walk into a Louis Vuitton store. This episode is brought to you by Netflix from the creator of Homeland. Claire Danes and Matthew Rhys star in the new Netflix series the Beast and me as ruthless rivals whose shared darkness will set them on a collision course with fatal consequences. The Beast in Me is a riveting psychological cat and mouse story about guilt, justice and doubt. You will not want to miss this. The Beast in Me is now playing.

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It. And you actually went where I wanted to go next. And I'm going to phrase this as business identity, right? Like, I think so many businesses, when they get stuck at trying to scale or how do I scale is they don't know their identity anymore. It's keep up with the Joneses or keep up with the whoever. But what they don't realize is it's levels to this, right? And there's always, unless you are the founder of Louis Vuitton, there's always someone that's a level higher. But what you're not realizing are or is, is that, you know, I'm looking at Kris and Chris's EBITDA margin might be negative, right? But if I don't know that and I'm trying to do what Chris is doing, then it's just driving me to a negative EBITDA margin. And so I feel like businesses lose their identity or one of the challenges that I see or mistakes that I see is losing their identity. Because to your point, when I go to Walmart, I have low expectations. I expect to almost be an employee of Walmart when I go into Walmart. Meaning I'm gonna have to go find it myself. I'm gonna have to go check it out myself and. And bag at myself and give my own self a tip for the job that I did at Walmart. Right? Businesses need to focus on keeping their identity. Their identity. What do you think about that, Chris?

Man, dude. So first of all, you're bringing me right into one of my very core principles of running any business. And it's this. You are not in competition with anybody that you think that you are in competition with. The only competitor that you have in any business is the pain that you are solving. That is your comp. That is your competition. And so when you go to your client and you properly identify the pain that they have, you help ask the questions and identify and demonstrate how your product solves that pain. It doesn't matter where you're priced at, but the second you start looking around and saying, what is everybody else charging to solve this pain? You've lost. You've lost because they are not your competition. You guys are all against the pain. Everybody is fighting a common battle. You're differentiating yourself with your branding, your marketing, your experience and everything else. But you are not in competition with these people. You are competing for your customer against the pain that they are experiencing. And the second you realize that you could charge whatever you want, because when somebody is drowning and you are selling life preservers, right? And you properly help them identify, man, this sucks. I'm running out of oxygen. It is tiring. And everything else, you. And you're like, hey, I have this life preserver. Here you go. They're not going to be like, whoa, whoa, whoa, how much is it? How, how much is it? And they're not going to say, wait, how does it compare against your competitors? And they're not going to say, wait, how, what is your, your Google ratings for this particular life life preserver? They're going to be like, give me that crap. I just realized I'm dying. I have pain. And you have the solution to my pain, okay? And this is what, this is what allowed me to be able to go and sell solar. Like, dude, I, I just had lunch the other day, two or three days ago with a former, what most people would call competitor, and they wanted to like talk to me and say, dude, how did you do it? Like, how did you go and grow? They're like, we were sitting here, we started about the same time and you know, this year we're gonna, we're on like our highest growth year and we're gonna do $15 million. Like, dude, you know, three years ago you did $233 million and you charge twice as much as what we do for the same exact product, right? And so, and that's where I told him. I'm like, guys like, you don't understand. You are not in competition with me, okay? You're trying to out price me and be 50% cheaper and everything else. When you're missing out on the point that these, your competition is the utility company, the power bill that these guys are paying every single month, and the disdain that they have for the control that somebody else has on their bill that they have zero ownership and they're. And it's dirty energy and whatever else, whatever pain that they are experiencing that they don't even realize that they're feeling and help you properly ask questions, identify. Then guess what? They're willing to pay whatever they want for solar. And that's why they'll pay $80,000 for my system, that they'll pay $40,000 to your company for. And because I'm charging 80 grand, I can provide the best technicians, the best experience, the best warranties, the best guarantees, and they're going to be like, wow, that was an amazing experience.

Yeah. And you need less customers at that point.

Probably. Probably one of the top reasons. Right. Like. Like, I have to. I have to sell a fourth of what you have to do by charging double. Right. Because when my gross margin is 80%. Okay. And your gross margin is 20%, I literally have to sell one for every four that you sell. And which means I have to have less infrastructure, I have to have less management, I have to have less fulfillment. All the things. You're working four times as hard to make the same money as me. Actually, more than that, because of all the infrastructure and everything. We just talked about you literally working six to ten times harder than I am.

Dude, same thing. You know, I come from the insurance space, and I tell. I used to tell people this. If my ideal client paid me 20,000 in revenue, that was average, and yours is 3,000. Look at that difference. Right. How many customers do I need to get to 5 million of revenue versus you? And, oh, by the way, if we do an employee per revenue breakdown, I can literally have one employee just managing 10 customers and yours are managing 100. Look at that customer experience. If you can always talk to Sally, if these customers always talk to Sally and no one else, what does that experience look like? And then Sally only has to know the identity of 10 customers.

Absolutely.

People don't get it, Chris. People don't know.

And, and, and that's fine. Look, we were trying to go and help these people, and we're going to. We're going to do our best, but as long as people don't get it, it's going to allow for the people that do to continue to dominate.

Right, Right. You know, and again, Chris, I could talk to you for 100 hours because, again, you are one of the people that I look up to, not just in the podcasting space, but just in business in general. And one of the themes that you always talk about is culture, right? Like, that's an ongoing theme in a lot of what you do. And if you were to ask me, where do people. What do people get the most wrong? It's the emphasis or lack of emphasis on culture. And I'm gonna give a shout out to one of my buddies, Bradley Flowers, he says if you have to talk about how good your culture is, you really don't have it. Right. The theme, I would love for you 60, 90 seconds. How important is culture? And what's the one or two things that people can do right now to impact their culture?

You know, I forget the. The. The quote. It actually might be the. The founder of Zappos. But he says culture isn't just something, it is the only thing. And you know, I wholeheartedly agree that culture is the foundation of any great business. It's much of what I've already spoken about as far as making your employees your number one customer. Right? Like providing a place where they can come in and be better physically, economically, with their associations and their spirituality, focusing on the whole human approach. And so, you know, there a lot of people, they've experienced good and bad cultures, and culture is either created by design or by default. Occasionally people by default get it right. For whatever reason, they got lucky. They had some foundational principles that they subconsciously knew and, and by default they turned in a good culture. But rarely, almost never, do you create the best cultures unless you're doing it by design. Design. And most people just absolutely have no idea, like, what that even means. Right? They've, they've felt a good one. Everyone knows how culture feels. You walk into a place, you're like, oh, this is good, or you walk in a place like, oh, this is bad, or they've been a part of a good sports team or a bad sports team. Negativity, negative energy, positivity. But it's like, how did they create that? And most people don't have that solution. And so that's where I've spent most of my life studying, studying exactly how you do it by design. I've had many mentors. I've spent over a million dollars on my personal education, much of it which is around culture. Culture, architecture. I spent four and a half years working for other businesses strictly like studying exactly how these CEOs were creating this incredible culture. And I think, I believe that the CEO's sole responsibility is creating the culture, the culture. And, and culture translates into the way that your customers experience your business as well.

Right?

And so there is so much, and I don't have enough time to be able to go through like, exactly how to design it. But it's, but it starts with like some of the very basics of like, having a vision and mission behind your business and not only just having it plastered up on the wall, but living it and breathing it and having a part of every single meeting and decision making process and whatnot. And then, and then core values that dictate the way that you run your business, the way you hire fire promote, the way that you analyze the way somebody is performing in your business, the way that you create your incent structures and your pay structures and your competitions and your recognition and the Consistency and the trust, transparency and everything else that goes into it. It is very much by design. And like I said, this is something that I teach. In fact, on Tuesday I am doing a workshop in which we are going through. I have business owners that are flying in and some that are attending remotely that we have a full workbook that we say, okay, this is how you create your culture. And I teach them my exact playbook to be able to go and create culture. That is one of the foundations of any. Whenever I meet with any business owner, there's four things I address. Number one. So it's called my coal framework. You have to have coal to keep the fire burning. Which is kind of funny because I own a solar business. But so if you have the coal framework, the first one is culture. The second one is accountability or is offer this the third and offer addresses your pricing strategy, your marketing, your sales, everything like that that we've already talked about. Third is accountability in the way that you're organized and you have proper KPIs and you have your SOPs and everything else is properly structured. Report on everything like that. And then ultimately your leadership which, which is developed and like I go in and that's how I address any single business. And, and but foundationally is culture. It has. That is where you have to start, you have to, you have to run with. And once again this is why I make it such a big emphasis in the way I teach business owners.

Doggone it, Chris Lee, I love you brother. You are the freaking man. So I'll have all of this posted on the show Notes. But where can people follow you, find you that don't know where to follow and find you.

So Instagram at Chris Lee qb like quarterback that that's main. All platforms, that's where I'm at. But you know, some platforms I'm active and some I'm not very active. So find me there. So currently the the name of our podcast is the Founder Podcast. We're actually in the middle of a rebrand. It's to uh, next level pros is is going to be uh, the rebrand of everything that we are doing. Because the where the basis of that comes from is that success isn't a destination. Success is a trajectory. And as long as you're on the trajectory, you're being successful. And no matter where you're at on that trajectory, there is always a next level. I don't care if you're a billionaire, you're just starting out, you're bankrupt. Right? There is a level that you can get to. And that is what my platform is all about is helping people get to the the next level.

All right, I'm going to get everyone there. Chris, I'll make sure that everyone follows you. For the listeners and viewers, do me a huge favor, follow Chris. He's very personable also. Like he, he messages me on Instagram, we talk, we go back and forth and he's just an overall great human being and for those that know me know that I love great human beings. So Chris, brother, thank you so much. I know you're a busy guy and to take some time out of your day meant the world to me, bro.

Other, thank you so much.

You got it. To all the listeners, remember your because is your superpower. Go unleash it.

Thank you for tuning in to make Unplugged. Keep pushing your limits, embracing your purpose and chasing greatness. Until next time, stay unstoppable.