Episode 253: A Profit First Turnaround with Jaime Jay

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Yeah.

Throwing back a shot of whiskey.

Can I get credit for this?

Did you pick this song?

Yes.

Jeremy. I love this song. You, my friends, you are listening to Entrepreneurship Elevated. My name is Mike Michalowicz. I'm the author of. Oh, we can go on and on about it. Should I? Oh, you want me to? Okay. Profit first, Clockwork, the pumpkin plan, Surge Toy, paper entrepreneur, brand new book that's coming out. And I'll tell you, I'm on a mission. I'm on a mission to eradicate entrepreneurial poverty. You know what that is? You know what that is? That's the dream that's become a nightmare. And we are fixing that. You are spending all your time in your business. You're working your tail off and not seeing results. We fix that week in, week out on the show. Joined in studio by two of my favorite colleagues, J. Bone and Kelsey Ayers.

Hello, friend. You can find us on itunes. Stitcher, tunein radio, Spotify, iheartradio or entrepreneurshipelevatedpodcast.com and Google Play. And Google Play. But please subscribe. That's it.

Oh, that's it. Oh, the way you said, I thought there was more to it. So, yeah, please do subscribe. Please give us a rating. We want to know what you think about the show, and we want to be with you every single week. Whatever you're doing, we want to be there. And there's always surprises, like you don't know what you're gonna be strapping on. This week is rubber gloves. What was it last week?

Whoopee.

Cushion would be cushion. And the week before was the Toyota Tacoma. Toyota Tacoma. My head. Friendly. I think that's the coolest pickup truck that's out.

Yeah, I love Tacomas.

Why didn't you get a pickup truck? Why'd you get a Subaru?

Gas mileage.

Okay. Yeah, you would have got a Toyota instead.

I would have loved to pick up because I need. I feel like when you live by yourself and you have your own house, having a pickup truck is super handy.

You need to pick up. I was actually expecting that.

Yeah. So I commute too far then. It's not. It's better for me just to, like, borrow or rent a truck when the need arises.

Maybe you can buy a beater pickup truck and just keep it. Your house. Have the grass go around it.

Yeah, exactly.

You forget you have a truck until you're mowing one day and you hit something like. What's that? What was that rock? Oh, it's my coyote.

Yeah, that giant. Well, you are a little steel. What is that?

What is that? Well, I can see you doing that. How often do you mow your lawn? How often do you mow your lawn?

Like, once every two months.

Seriously? In the summer, are you an active mower?

Not an active mower. But I also realize that if I let it go too long, it's way worse.

Yeah. So you mow your own lawn?

Yeah, probably, like, every other week, which is more than I should. But honestly, a lot of my grass is weed, so it doesn't really grow.

Yeah, it grows. It's a little more along the ground.

Exactly.

How about you, Jay Bone? How often do you mow Your lawn?

I don't have a lawn to mow now because it's on my house.

But you have a new place, don't you? An apartment?

Yeah, but I'm just running because I didn't know where I was gonna.

So.

Yeah, I honestly, it's such a headache off or weight off my shoulders because I put so much work into the house and now I don't have to do any of that. And actually the owners are so cool that I negotiated with them and they let me. They took a portion of the rent that I was going to pay them and let me upgrade the kitchen and put stuff in that I wanted to put in.

Oh, wow. So I got.

I have a brand new double oven right now. It's awesome.

Look at you, fancy pants.

I know because I did like work in the house to like fix up the house for them.

That's nice. Oh, so you're renting a house?

Well, it's a townhouse. It's like a. Yeah, it's a townhouse, basically.

Yeah.

Small town.

And did when you sold your house, did you come out ahead of what you bought it for?

Yeah, yeah, it was, it wasn't like crazy good, but I. I got all my student loans and all my credit card debt paid off, so.

That's awesome.

Phenomenal.

And you paid your rent for a year, right?

Yep.

That's awesome.

Yeah.

So do you still have student loans?

Yeah.

How much? I mean, you don't tell me the dollar amount.

15,000.

They're. They're debilitating. Like, if you read about it, it is. It is a nightmare. Like, I seriously think it's going to be like one of the single worst factors to the economy coming up in the, like, upcoming years.

She's a physical therapist and her, I think when she was all said and done, was close to a hundred thousand in debt. And her payment is like over a mortgage payment.

Like, I think the average college. Wow. This is my own number. About 40,000 a year now is what's running.

The problem is now there's such a large gap, I mean, depending on the profession, what it costs to go to school and then what you make coming out of school.

Like your top dollar. What you can make in that profession.

Yes.

As a social worker. How much am I gonna make?

Yeah, like average student loans. I can't remember the number. I want to say it's like around 30,000 or 40,000. I mean, even that's a lot. I had 65 when I got done. It was interest. It was like 75.

Jeez.

Yeah. And my degree is entrepreneurship, so.

Could.

Have got advice on that one.

Yeah, you could have just read a book for $18. Wagga wagga. Yeah. But there. There is hopefully a transition going on. So I think growing up, you guys in particular. Me too, though. Like, if you didn't go to college, that was considered a failure.

Right.

My generation, because I'm 15 years older than you guys, is that pressure wasn't there 100%, but it was. Growing my children now is like, if you don't go to college, you literally are considered a total idiot and failure before anything. So. And they're there, but they're retaliating against it, which is wonderful. So their school, they congratulate kids that got into Harvard or whatever. Like, that's the prestigious thing. And so some of these students are like, why aren't we congratulating someone that got a job?

Yeah.

Someone that entered the trades, like, and so there's now this pushback. And I think, like, 10, 15 years from now, it's not going to be this crazy, like you get a degree or you're nothing. It's going to be pursue your passion.

I hope that's the case.

I think so.

Yeah.

So when we talk about some of the trades, like, the trades are exploding.

The income skilled trades are awesome right now because they're. They're paying like average, like 55, 60. Starting.

Starting.

No student loan debt. Like, starting.

Dude.

Starting. Yeah.

And it's like, it's always going to be necessary for the most part. And it's a dwindling industry in terms of employees to be able to do it. So. Yeah, it's ripe.

I love it.

You know. You know what, though, I have to say this. So obviously I was working in restaurants before I went back to school to get my business degree, but if restaurants.

We use that term loosely.

Yeah.

They were strip joints.

If I.

He was the. He was the fast order chef in the back. He wants two wieners, and he'd be flipping them over.

I worked at strip steaks.

Yeah.

So. But if I hadn't gone back to school, then I wouldn't be here because we wouldn't. We wouldn't have met.

That's true.

Yeah.

So, yeah.

Yeah, we met.

Full circle.

Yeah. Networking. No, I'm. Dude, it's a joy to work with you and it's a joy to make fun with you.

Thank you.

Yeah.

Make fun with you.

Of you. When I'm not participating.

It's fun to make fun of you. Yeah, it really is. Actually, Kal, before we get started. I do want to thank our core partners. Make the show reality. So thanks nextiva and Receipt Bank. We'll tell you more about their amazing features in a little bit. We do also have a listener shout out.

We do. So this comes from Adkins Supply Company. I found Mike's books by happenstance on Audible. I quickly listened to the Toilet Paper Entrepreneur, the Pumpkin Plan, and Profit First. I couldn't get enough. I was so excited when I found this podcast. Thank you for so many encouraging words and always giving amazing tips. I can't wait to see how my business grows in 2019 with implementing profit First.

Oh, I meant to hit the Halloween button. I missed it a little bit. That's awesome. Atkins Supply company. They should give us a link or something. Maybe we can put in the show notes in the future. But thank you so much for watching for. For that kind words. Let's get to the meat of our show right away. Nine minutes in. @ the core, Jamie J. Is a connector of personalities and brands. He constantly challenges himself to be a better human being. He is also an amateur hockey player and starter geek who truly enjoys helping his clients rediscover themselves, their companies, and how to realize their personal why. He runs a company called Bottleneck Virtual Assistants. They help stop the bottleneck in your business by employing virtual assistants. And Jamie J. Implemented Profit First. Jamie, welcome to our show.

Welcome, Jamie.

Hey, thanks so much for having me. Super pumped.

Oh, dude, we're pumped to have you. You know, when we were talking off air, you had this Peter, you know, take from Peter, give to Paul moment. Sound like a defining moment in your business. What was that?

Yeah, this is a great question. A great way to start it off. I don't know how other people run their businesses, but I was run. Well, I'll just say it. It was very inefficient. And so I would have. I have a couple different accounts set up, and I would owe more money than I had in one account. So I transfer over from another account. And as long as I would look and see what my balance was, I was like, okay, I got this, no problem. And so I was literally borrowing from Peter to pay Paul and doing all that kind of stuff. And I was pretty much winging it. I was winging the books.

Okay, so you're winging the books. And what was the impact in your business? I mean, how tough was getting?

Oh, my gosh. So I would say, okay, so on the, on the outside it was, you know, this is a great opportunity. You know, come on in there. I Had to keep that face going, the positivity going, so that, you know, I could continue to build the business. But deep inside me personally, and probably the people in my mastermind and my girlfriend are probably the only people to know it, but I was freaking out. And I think it was part intimidation, part just. I didn't know what I didn't know and. Cause here it is. I am, you know, I love what I do, but I am deathly afraid of numbers and figures and probably even more so afraid because I knew that if I really took a deep dive, look at my books or the lack thereof, how overwhelming I would, you know, the whole situation was gonna be. And it was really, really scary. Gotta be honest with you, it's kind of like looking at yourself in the mirror and really seeing deep down what, you know, what you're doing. And it just. It was not a good feeling.

But I guess one day you have to face the facts. I mean, I make that akin to going to a doctor. You know, if you have an injury, I don't want to go to the doctor because he's going to give me the diagnosis of whatever it is. And now I have to face the reality. So I put it off. But that injury is not going away. Is that similar to what you were experiencing? I mean, you're afraid to look at the numbers to get the real diagnosis, but at a certain point, you have to face it.

Perfect analogy. 100% perfect analogy. I didn't want to face it. Like I said, I have a very hard time. Kurt Stowers, he's my virtual cfo. An amazing guy, amazing with numbers. Thank the Lord for him to come in and look at my books. And he slapped me on the hand, you know, on the wrist, whatever. Kind of like Sister Margaret did to me in sixth grade when I ran out of class. But he did it in such a kind way. And he also subscribes to the prophet first mentality. So I thought it was. What a perfect relationship to have there if it. If it wasn't for him kind of saying, okay, situation is not good, Jamie, but here's what we can do. It gave me the light at the end of the tunnel. And by implementing the profit first system, it's so much easier. It's like a weight has been lifted off my shoulders. It's not even funny. The difference between where I was to where I am today. And by the way, still improving. I'm still striving to get where I want to get.

So give me the day before the hand slap from Your coach, like, what was the business like? I don't know if you're willing to share numbers, but maybe the. The stress level, maybe you can share how many employees you had. Like, what was it like the. The day before you had that?

Aha. Sure. Yeah. Well, it had been. We've been talking a lot about profit first in our mastermind. A lot. I think I would say. I can't speak for everybody, but within our own personal group, I would say probably 80% of us, I think just about all of us, profit first. And. And so it's. We're able to share our experiences with one another, but it's okay to share concept concepts, you know, like, this is the game plan we're gonna do, but when you start diving into, okay, this is real. This is me. So the day before you asked, I did not want to, because Kurt's in my mastermind as well.

Oh.

And I don't know about you, but he's like a good friend. And sharing my personal. Probably my most secretive part of me is the books, my business, the health of my business personally. And that was a huge mountain. I was freaking out. And I told him, even on the call, I said. I mean, I was sweating. I was so scared at what he was going to see that, you know, I. I just. But I said, you know what? I got to do this. And my girlfriend and I talked about it for a long time, and I. I canceled several times. You know, I didn't ask him several times. So I finally got around to it, and then when it actually happened, I was so relieved afterwards. So the day before we started, I think we had 17 on staff. Um, we took three down. Uh, so we tried to bring it back down again to build it back up.

Yeah.

Um, and that was really hard to do.

Yeah.

Um, but. Oh, go ahead.

I said, oh, yeah. I'm just acknowledging. Yeah, I can relate to that. Keep going, man.

So, yeah, so the overhead thing was a hard part. And when I. We went and got a new cpa and we introduced her to the profit first, and then we went to the bank and set up all the accounts there. And Sarah, my girlfriend, sent her a copy of your book. Our banker a copy of your book. And she was really thankful for that to see that. So that was pretty neat. But going through that whole process was very intimidating, thinking that I don't know if this is going to work and pay myself first. What are you talking about? I don't have the money to do that. I can't do that. I owe too much. And so we had to kind of come back, get rid of some software, get rid of some extra things and reduce our costs so that, that it would work. And I can't, I can't. I mean, the difference is night and day. I just, I got to say thanks for writing that first and foremost because it completely changed the way that my entire life is run.

My joy, when you're going through this process, did you beat yourself up at all during this transition?

Oh my gosh, yes. Like I said, I put on a. I don't necessarily want to say a front because I was very authentic. I believe in our service 100%. I love it, I live in it. I'm a systems and processes type of person. So that's another reason why I like Profit First. But I was on a system and process person on the operation side of things, not on the financial end of things. And so I was kind of thinking I was a little bit of a hypocrite. I'm out there telling people how to scale their business, but from an operational point of view. And in my opinion, I just, I wasn't comfortable with that. So I had to make the change. And you're right. Yeah, I was like. I even said this to my group. I said, I think I'm a failure. And boy, did they get on. They got onto me on that one. So I had to quickly adjust my mindset there. But yeah, I really thought that I was setting myself up for failure basically is what I was doing.

So tell me now about the other side. So you said the Profit first has served you. Give me some examples of what the business is like today and then I want to know how you got there. But what's it like now?

Like I said, I'm still striving, so we're still trying to get where we want to get to. However, it's so much better now. I've saved money on fees. I wasn't optimizing the way that we paid out all of the assistance. And so now it's a lot better. We have a spreadsheet that payroll manager can go into. Slash my mom.

Well done that first baby. Love it, love it.

So she can easily go in there. It's all laid out for her. We have the formulas written in and we have a separate master sheet. So anytime we're working on each payroll period, it doesn't get messed up stuff. And it's just, it's so easy now. It's so clear. We know exactly where we're at at any given time. And it's just, I. God, I could just go on for days about this, but it's, it's simply amazing.

So, okay, so you're taking your profit first. Now let me ask you this. Are you profitable? Are you accumulating profit?

In April will be our first, first month of being in literally a profit prop for the first time ever.

So you already know. You can look as we're recording this in February, you can look two months out and you know that you're gonna have profit. It's because you have a profit account, I presume, or why is it, how do you know you're profitable?

Yeah, so we're. Because, because of the cost that we've taken out. We've got a couple contracts we got to finish in and those will be coming off before. One other thing that I didn't bring up before is I got a working capital loan through PayPal because my business is virtual. So I got a working capital loan because I wasn't making enough. And so I would get that and get the loan, pay back the loan, get another loan, pay back the loan. I was doing that thing.

Yeah.

And it was, it was flipping terrible.

Yeah.

So what we're able to see now is exactly how much we're bringing in. And then we know by April when that that loan falls off and our two contracts finish up, we will finally be, you know, ready to rock and roll and grow because we've hit the threshold. I have a certain cost fixed right now. A certain fixed cost. And I know that that's not going to fluctuate. It's not going up and down because I've taken all of the other thing was I took all of our internal staff.

Yeah.

And I took them off hourly and put them on salary.

Oh, that's interesting.

Really helped as well.

And that by changing them to a full time or payroll, it actually reduced your costs.

It actually reduced our cost, but also helped me plan.

Right. And I bet you they may like that too, because now they have some predictability in their own income.

Hundred percent.

Isn't that amazing? You found a way to save money to give consistency to your employees, Drive more profit. Nicely done. What about debt? Do you have any debt? Is that just that one loan through PayPal or what's going on?

Just that. Just that one. That's it.

And now with Private first, you're using profit distributions. The only rule you can use profit for is to eradicate debt. Or once that's done, then it's only to celebrate. So you're using your Profit distributions to crush the debt right now or are you paying it off?

Yes, yes, yes. And what's other something else that I want to point out too. Another part of the business is I was an llc.

Yes.

And the tax on that here in Missouri is pretty substantial when you start getting above a certain amount. And so what I did is I just completed the election to do it S corp for the llc and so that's going to drastically reduce the tax and it also helps me plan for the tax as well.

Nice. That's amazing.

Yeah.

You know, in New Jersey where we're based out of it's around a million dollars where it starts making sense to move from an LLC to an S corp for the exact same reasons. So okay, what about your personal income? You said you were taking loans to pay your own income to your own personal income. Is the business now paying that? Do you have consistency, predictability now?

Yeah, now. Now I have a paycheck.

That's nice, dude. Every, every, every two weeks or whenever you do payroll or distribution.

Yeah, it's 1st through the 15th and 16th through the end of the month.

Nice.

And then what, what I'm going to do instead of three months for the profit first I'm going to do six months.

Okay.

And then I'll take out the 50% at six months time frame instead of the three.

Awesome, awesome. What do you mean? Plans for your profit distribution, Your first one that's coming out?

Heck yeah. Yeah. Well, we are, we. Well we don't have any debt right now, but what I did find out is it's good to have a car loan. So we have, we have one car right now, but it's paid off. So we're going to go get a new car and we're actually going to, we're going to get a new car and put it on like a 3 year, 36 month so we can build up some credit there as well. Because that was one thing that happened as well as my credit got dinged pretty good from all the stuff that we were doing. So I'm working on building my credit back up and it's 643 right now.

Nice profit.

So it's pretty getting better, but I want to get better and better. And then in the fall we want to start looking for some land to purchase.

Wow. I love that you have reward mechanisms and I can promise you your credit, your personal credit will bounce back very quickly. So you implemented profit first. How long ago? When did you start?

Let me see. I think three months ago.

Yeah, dude, I give you three or four more months before you're like 730, 740 in your credit. I don't know what Jeremy or Kelsey, what your credit is if you ever check it. My darkest period, I was down like, it was like 500 something like it is. You're. I was getting letters from those companies. I don't know, Jamie, if you experienced this where they said, we can. We can get rid of your debt for you, you know?

Yeah.

Like. Like four or five mailings a day and phone calls. Did you experience that, Jamie? Oh, yeah, it's.

Yeah.

Oh, my God. How did that feel?

Oh, it's terrible.

Miserable, right?

Yeah. I can't tell you. This is. It's almost. And you have such a good tone on the show here, and it's so upbeat. But there is a point in time where, you know, it almost brought tears to my eyes in talking with my girlfriend because we were actually. We could see light at the end of the tunnel, and I can't tell you how stressful that is not to be able to have that. And I don't want to say clarity yet, but direction. And that's all it took. It took a little direction. And flipping the equation from income minus expenses equals profits to income minus profits equals expenses. Completely rocked my world, dude.

Thank you for saying that. I mean, that. That's. It's unbelievable what small perceptual changes with the impact they can have if we act upon it. So ultimately, the success. It's funny. The formula is nothing new. It's not like I invented anything here. I just took something, the pay yourself first principle, and said, oh, we can apply this to business. Jamie, what I just want to acknowledge is you have a recipe in front of you, but you're the guy who cooked this up. I mean, look at what you've done. I just want you to know from the bottom of my heart how proud I am of you. And thank you for leading. Thanks for sharing your story and leading other entrepreneurs down this path of your success. Keep it going, my brother.

Yeah. And kudos to you for sharing with your girlfriend, because that's actually a super hard thing to share. The people who are relying on you or depending on you in one shape or another, that's incredibly hard to be that vulnerable with that person. So kudos to you.

Thank you. Yeah, she's actually helping with the business now.

That's awesome. Girlfriend, My mom. That's awesome, Jamie. Listen, there's some people that will need virtual help. We're actually. We just started talking in house that we may start seeking this out. Where can we and our listeners find out more about your company, Bottleneck Virtual Assistant?

Well, you can go right to Bottleneck Online and that's the website there. You can Google virtual assistant companies and check them out. And that's one of the things that I want to say, too. Obviously, we'd love to have more business. We just enjoy and love what we do. We have an incredible culture here. But one of the things I recommend doing is if you've never had a virtual assistant before, I would recommend googling virtual assistant companies and checking a couple of them out and learning more about it before making your decisions. Because everybody offers free consultation. So take a couple consultations, learn about it, ask questions, things like that. I think that's really helpful. But yeah, you pretty much.

We're.

We're pretty much everywhere. If you just go on Bottleneck Online, you can learn more about us.

Awesome.

We will share that. Jamie, hang tight. We gotta do some other things, but we want you back during a little segment we're gonna do about Is this a real quote or not? So just hang tight. Okay. Thanks for joining us.

Thanks.

All right. That's why I get wrecked out. Is he awesome? Yeah, he is awesome. He may be my favorite guest, one of my favorite guests of all time. I mean, just, wow. It's okay to have a little man love towards someone. I'm like, I think I fell in love with him.

Yeah.

Yeah. Okay. Like bromance. Bromance. All right.

Man love.

His man love. That's what Jeremy tells me it is, is it not? Man love, you say? Mike, use the word man love.

Just when I think, like, it's getting better. Start something new.

You said you're that organization called the Man Love.

Man.

All right, so we got a lot of things to do now. We got decompressed a little bit. That's a powerful story. We have to share what we learned. We have a little listener mail again today. And we're going to do the elevation point. And we are also going to do the who said that. That was supposed to be a who said that. There it is. The who said that? Segment. But first, I do want to thank our corporate partners. So nextiva, That's a voiceover IP phone system. It is something we use in house. Do you have one yet?

No. You still haven't sent me one. All right, so come on. What are you doing?

Yeah, well, let's get one of jbone. They have these new functions. I can't believe we haven't set you up yet there's one called the True Voice System, where when you and I speak jbone over at nextiva, you can hear me as if we're talking face to face.

They also added the extension function, I believe.

Oh, yeah, yeah. Tell me about that.

Yeah. So you type in a three digit code and it can transfer you. It's pretty real awesome.

Yeah.

That's amazing. It's like almost like teleportation.

Almost. Almost. They're getting there.

Because your voice, that's what's so powerful about this. Like, say you're in your. You're in. What town are you in?

In Pennsylvania now? I'm in Brookhaven.

Brookhaven. Okay, so you're in Brookhaven. Are you saying you could dial three numbers and your voice could appear here? In New Jersey? In Boonton?

Absolutely.

Damn. Yeah, nextiva.

Yeah.

Find that elsewhere you can.

Yeah, any. Anywhere else.

Nextiva.com. we know. We love those guys. And Receipt bank, you're a big. Not user of Receipt bank, right?

No.

You use it, do you?

No, I don't.

I do, though. I'm.

So you said you're a bit. You're a big nut user, not user.

Are you a big nut user? I see you with walnuts, almonds all the time.

Yeah.

Did you hear Paul when we were walking to the meeting? Story brand? He's like, oh, tell the nut joke. Did you hear him?

No.

Oh, good. So I love Receipt Bank. I use it regularly and I use it for one thing. Scanning in my receipts now. Here's the thing. That's what it's designed for.

Amazing.

You can scan your receipts. Ties it into your QuickBooks. Any accounting system you use, quite frankly, syncs it all up. It's amazing stuff. Check out our buddies. We love to poke fun at them. Nextiva and Receipt Bank. But they're extraordinary. When you call them, tell them you heard about them. On Entrepreneurship elevated. Ask for 75% off. They will not honor it. I'm just saying ask for it. What do you have to lose? All right, Kelsey, what do we got next?

That was great. I was not expecting that.

Thank you. Thank you.

We have to talk about what we learned. We have to play our game. Who said that? Okay, we have Listener mail. And you have a tip. An elevation point.

Okay, so let's start off with what we learned. Kelsior first.

So I just really appreciate hearing stories like this because I feel like we don't hear them often enough. But it's so much more common than we give credit due to. But I really love how he considers Himself a systems and processes person on the operations side and not the financial side, but felt like a hypocrite because he wasn't mastering this financial side and he was just sort of like burying his head in the sand about it. And I feel like it's really important to acknowledge that we aren't these superhuman people who are excellent at all aspects of business. Nobody is that person. And just because you're good in one area doesn't mean that translates to all areas and doesn't mean that you're a hypocrite for saying that you're good at business or that you're a failure as a business as a whole.

Juicy J. Bonet, are you ready, sir? Yes.

So I liked when he was talking about the hypocrite and saying he beat himself up. It reminded me of this book where they did a study and they found that one of the biggest factors of success is just grit and willing to, like, push through. And it's like the mental toughness side of it. Yeah.

Two things I took away. First of all, just his entire presentation. I want to do business with him.

Yeah, exactly.

Right. And so, wow. He just laid out the ultimate way to sell is just tell the truth. What I loved was he said at the very end, he's like, listen, I don't know if we're right for you. Check out all the companies. You should test this out. And like, now I trust Jamie more than anyone. I want to work with Jamie. The part, though, where I fell in love with him was when he said, oh, yeah, our payroll manager, my mother and I was like, this guy is awesome.

Yeah.

My parents, my mother in particular, but my father too, helped my companies. But I was ashamed of it. I wouldn't. I didn't want to share that because that showed a weak company and that's flipped now. I'm very proud of that. And to hear that pride in Jamie, I have even greater affinity toward him. That is a profit first business. He's leveraging the people around him that care for him and want him to be successful by engaging them their services. So freaking kudos to Jamie.

Yeah.

Okay, what's our next bit there, Kels?

Let's do listener mail. Okay, so this comes from Trevor. So Trevor has back taxes to the tune of about $80,000. Would payroll and the payroll taxes be a part of operating expenses? Where or how do I classify property taxes? The back taxes he owes are about $150 a week, but he's going to raise that so he pays it off faster. How does he categorize that?

All right, so back taxes on property. The question is, does the business own these properties? Maybe he has apartment buildings or something. Or is this personal properties? Like, this is his home. If it is the company's responsibility, we will pay it out of operating expenses. And when profit distributions come out, because that's debt, just like Jamie had debt with the PayPal, we use the majority of the distribution to whack out debt and a small portion to reward himself. So if it's business debt, yes, I have operating expenses. Yes, I have profit. If that's personal debt, then it comes out of your paycheck. As you get your pay, you're responsible to pay off your debt. And when profit distributions come out to you, as the owner, use that money. I encourage you to eradicate your personal debt. So we just need to qualify as a personal or business. If it's a business, the business must address it. If it's personal, then you must address it personally. That's how we bifurcate those two. But no matter what, get rid of those taxes. Do not have debt. Debt sucks. All right, what we got next, Kelsey do?

You.

Didn'T say it fast enough. One more time.

Elevation point.

I do. Oh, here's the elevation point.

Oh, that's what you're calling it?

What'd you want me to call it?

I don't remember.

I think you do.

I think you do. J. Boner Ramus.

I think I wanted it. Elevation point. I think that. I think that was my idea.

No, I think so.

Let's go on.

So here's the elevation point. When we cut costs in our business, there's two types of costs you can cut. There's what they call cut the muscle or cut the fat. You want to cut the fat of a business, but not cut the muscle. And people get confused of this. Like, what's muscle and fat? So muscle is what moves your business forward. Fat is unnecessary costs. Think about, like, our office space up here. If we move this space into the basement of some building or back to my house or something, there really doesn't compromise the business significantly. If we don't have adequate space, we're crunched. But we don't really have that many customers come here. We did for a while, members, but we're gonna start renting hotel space. So if we could find a new space that's less expensive. That's called cutting fat. Because it doesn't have any negative impact on your clients. It really is about serving the ego. Cutting the muscle is where you do something where it hurts the services you're providing your clients, hurts the client indirectly. So directly or indirectly. So if one of we let go an employee like Aaron. I'm not suggesting this by any stretch of imagination, but if Aaron left, that would be damaging to our clients. That's cutting muscle of the organization. Yeah, the marketing support. Like what. What Jay Bonaramus is doing for us and Paul, if. If they were no longer with us. That hurts the business because we're using it for marketing. So your muscle is anything that moves the business forward. Make sure you're quantifying it. Don't cut that. You got to avoid that as best as you can. Cut the fat. Those are the things that serve your ego. You know, usually it's office space. Sometimes it's employees like this. Just the number of employees that we have around just to feel good, to brag about the number of employees. But it's not moving our business forward. So separate those out. Cut the fat. That's how you make a business profitable. And increase margins. Of course. All right, cows, we got one more thing. What is it?

Who said that?

Who said what?

Isn't that the name of the game?

No. Oh, yeah. Who said it? But how are you supposed to say it?

Who said that?

No, who said that? Like, you gotta be a little bit outraged. All right, Jamie, do we still have you?

Yes, you do.

Okay, good. So you heard us talking about you.

No, I blinked that out.

So, Jamie, it says game works. I'm going to ask each of you, I'm going to read off four quotes. Four quotes of three of these. They are true quotes. These are all real people. And I'll tell you who the people are. But three of them are really what they said. One of them is made up. Your job collectively is decide which one's made up.

Okay.

All right. Do you understand the rules?

Oh, collectively. Okay.

Yeah, collectively this time because everyone's picking their own thing. It's just too much of a mess. So you guys can have a. You can have a little discussion around and pick your one. Does that make your. Does that make sense to everyone? Jamie, are you. Do you understand the rules? Yes. Okay, makes sense. First quote from Lee Iacocca, we've got to pause and ask ourselves, how much clean air do we need? All right, that's the first one. That was Lee Ikoku said that. He's the founder of the Caravan. I think the. Didn't he work for gm? Did anyone know?

You're supposed to know this.

Chrysler.

Chrysler. Oh, it's Chrysler. Yeah. Chrysler. Chrysler. All right, thank you. Point goes to Jamie, by the way.

All right, that gets you nothing.

Gets you nothing. But you got a point. Next one. You. This is from Jessica Heron. She's the founder and CEO of Stella and Dot. A favorite of yours, Kelsey. You have to see failure as the beginning and the middle, but never entertain it at the end. You have to see failure as the beginning and the middle, but never entertain it at the end. Okay, next one. Next one. This is from Greg Branderry. Brand. I'm sorry, Greg Brandberry. He's the guy from Novartis. Very famous executive there. Drugs can fix any health issue until they don't. Drugs can fix any health issue until they don't. In the last quote from George Bush. George W. Bush.

They miss he an entrepreneur.

No, but we're making a stretch. He did. No, not in this capacity. You're thinking baseball team. Yeah. Okay. Yeah, he did have entrepreneurial endeavors. I think you're thinking thinking of him as a president. But this is in his entrepreneur.

Silly me.

Yeah. This is in his entrepreneurial endeavors. He said they mince. They misunderstimate me. They misunderstimate me. Okay, does anyone need one repeated? Did you get all those? You good? Jamie, you good?

I got them all.

Okay.

Yep, I'm good.

You guys want to discuss Kelsey, My.

Inclination is the Novartis one. The drugs work until they don't. But that could be real, too.

Do I give any logic behind that or any consideration?

I mean, he's coming from a drug company, so it almost seems like counterintuitive for him to say that.

Okay, Jamie, Jamie, what do you think, man? What's your thoughts? Are you leaning with Kelsey? There's something else here going on, right? What's going on?

Yeah, I kind of am. I. I think the George Bush one's good.

You think it's legit that you say they misunderstood me?

Yeah. Just because of his wordisms.

Yeah, that's true. Okay, and what about the other ones? We. We've got to pause and ask ourselves, how much clean air do we need? Would ley Cooker really say that?

True. Would he say that? Would anybody say that?

We've got to pause and ask ourselves, how much clean air do we really, really, really need?

I mean, you just.

Well, maybe he was making a car.

Maybe that one then.

No, he didn't say that. Really? Really. I just add that because that's how it's supposed to be read.

He said because you made up the thing in the first place.

No. Maybe. I don't know.

All Right now, I vote for Lee Iacocca.

Yeah, I do too.

Yeah, don't let me persuade you. You guys are the jury. I'm just the judge.

Or is the Stella and Dot one too real? I mean, that's the most.

You have to see failure at the beginning and the middle, but never see it, never entertain it.

We're guessing the one that's wrong, though, right?

Yes.

Yeah, but I'm saying that, like, he might have done that one, because that seems like a legitimate quote.

Yeah, I don't think he's that.

Me either.

Yeah, good point. Good point, J. Bonerous. Good job, Sparkle. Yeah. So what's the.

The drugs one? I'll vote for the drug. That just sounds stupid.

Drugs for. Okay, we want to vote for drugs. Are you with Leo Coconheu? You guys got to come to a consensus. I hate to say this.

Yeah. I mean, I feel like that. That you guys.

You guys, you guys.

You're there.

You're the Jamie, you pick. You're the guest of honor.

Oh, Lord, the pressure. Yeah, I'm gonna go with drugs, too.

Drugs, too. Okay. I mean, no, not your personal choice. I'm saying, what's the quote you want? Okay. All right. So the quote that Jamie has elected. Kelsey, do you support this decision?

Yes, I support him.

J. Bone.

Yep.

Okay, you guys are. Drumroll, right? You are, right.

Yeah.

Drugs can fix any health issue. Until they don't. I totally made that up. Greg. I want to apologize to Greg Brandberry, because I did look him up. He is a Novartis executive. I just associated this quote with him, so that's total farce. Please do not sue him or me for slander, but I do have a $2 million insurance policy against it. Okay.

I mean, how much clean air do we really need? Hilarious.

Don't miss.

Was that in reference to their emission controls or something?

I just. I typed in stupid quotes that famous people said, and that just came up, so I don't know what it was in context, but don't misunderstimate me.

I mean.

Yeah, that makes sense.

I guess that.

Didn't he say truthitude? I feel like that was one that he said.

Yeah, he. He was worse than me. No, that's not true. All right, guys, let's wrap up and get out of here. Kelsey, why don't you take us on and out?

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You ruined it.

That was the music, dude.