Interview with Mike Michalowicz

Hi, welcome to this special episode of the Dr. Keith Darrow podcast. Today I have somebody that I have been following for a very long time. I am humbled that Mike Michalowicz. Did I say it right?

You nailed it, dude.

I've been practicing all week.

Have you really?

I really have. And of course my buddies are like, oh, Mike, Macau tits. They keep throwing all these other ones just to mess with me.

You got good friends. I love it.

I do, I do. I know I have very dear friends. So I wore for you today. First time I'm ever wearing it though is my pumpkin tie. You know, Mike, I started with profit first. I moved on to pumpkin plan. I am adoring get different because it's a message. It's so awesome. It's a message that we have been preaching in our industry of hearing healthcare for many years. Between profit first pumpkin plan, you gotta cut the pumpkins. You gotta be different. So I just feel like you and I are sort of business soulmates.

Kindred souls, baby.

Exactly, exactly. And just so you know, I know you're from what, the northern New Jersey area?

Yeah, yeah. You from Jersey?

No. God no. I am from Staten island. So you could go ahead and say the same thing to me, I guess.

Oh, Saturday Night Live just did a video about it. Staten Island.

Hysterical. Yeah, I don't want to kill my listeners ears. Otherwise I would go into my rendition of the Walking in Staten. Yes, that was a good time. So look, I want to just give you your due, which is you've written a bunch of books. I love all of them. You have sold companies and made millions and then you lost it all. And that's one of the things that I appreciate you, is your brutal honesty about the path that you have been on. So. So tell me what that's like. I mean, I. I haven't hit that sort of rock bottom. That's gotta be pretty scary. And I think there's a story about your daughter giving you the piggy bank. So what, what happened?

Yeah, yeah. And I wish upon no one. I hope you never experience it. But maybe, maybe there's a necessity that I did. And some of us go through it. I thought it was hot shit. You know, I built and sold two companies. I was really cocky. I felt like I was walking in Staten here in New Jersey. And I decided that to maintain my new lifestyle, I needed to start another business and grow faster and bigger than ever before. So I started a business as an angel investor. Did not know what I was doing. I was horrible at it. It Took me nearly two years. I wiped myself out financially completely. And it's a weird phenomena. I've heard others go through this too. You see your bank account dwindling and logically it's all going away, but emotionally I can't accept it. I, I actually doubled down as I'm collapsing and like, you know, I gotta, someone's gonna buy this, it's gonna turn around. I lost everything. And I had to come home to my family, this was back in 2008, to tell em we were gonna lose our house. I spoke to my accountant, he said you can declare bankruptcy because you can liquidate your remaining assets and start new. And I thought it was my responsibility to, to not take advantage of my creditors who don't even know who I am, and declare bankruptcy, but to pay my dues. And I came home sobbing because I was so ashamed that I lost everything. And I remember my daughter and my two sons, my wife were sitting at the table, we're going to have dinner together. Food was cold, they had been waiting for me. I looked my daughter in my eyes, in her eyes. And I said, I can't pay for your horseback riding lessons, which were 20 bucks a lesson. And as I said this, she went running out of the room. Everyone was crying and no one knew what was going on. It was such a shock to them. I thought my daughter was running away because I wanted to run away from myself.

Of course, of course.

You know, she ran to her bedroom, grabbed her piggy bank and she ran back to me. And I've never forget, she looked me right in the eyes and she goes, daddy, since you can't provide for our family, I will. And she said, use this. And I get emotional still thinking about it that she was willing to make that sacrifice. Her life's saving, she was trying to save for a horse. Some people ask me, did I use that piggy bank? No, she can't. But, but I was. It was a wake up call of the century that I needed to figure this out. I devoted my life not, not in that moment, but from that point forward I will eradicate entrepreneurial struggles for myself and for everybody.

And that was, that was actually my follow up question which was what is your why? What did that mean to you and how did you start to turn it around? I mean, how do you get out of bed the next day?

Well, with a lot of booze. I went through depression for two years. Self diagnosed. I never went to a therapist. Should have, I do now and I just would, would medicate myself with booze. And then. And sometimes I go to sleep hoping I wouldn't wake up. Not a suicidal thought, but literally just hoping I could just keep on sleeping until this misery went away, which was me. But what I did was I started journaling. I started writing down my thoughts. A friend of mine told me, he says, start journaling. Not like success things, but just write down anything you feel. It was an outlet. And sometimes after letting the steam go, sometimes for five minutes, sometimes for five weeks or five days, I had a little clarity and I could start working again and moving things forward, and I'd slip back into my depression and I start journaling again. That was the best tool I now feel on a life's mission. I actually have on my wall here. It says, eradicate entrepreneurial poverty. Yeah, I. I gotta fix this honestly, for myself. That. That traumatic experience for myself is so rooted in me. I gotta fix this for me, but I gotta fix it for anyone I can serve. And that's what I'm trying to do.

That's an amazing story. So then how do you get to your first book? I mean, how do you go from that? How do you start to build back? How do you get to book? How do you get to where you are now? Yeah, household name. Not that people can say your name. Maybe you're household.

I don't have a household name.

Definitely. Oh, definitely my household. Right before we got on, my wife called me. I'm like, what are you doing? I'm about to get on with the pumpkin guy.

She's like, oh, my gosh, that tool. Is he a new buddy? You're from Staten?

Exactly. Exactly.

How I got started was it was actually that journal. So I started writing down things I didn't understand about entrepreneurship. And I was like, I should have been profitable. And I wasn't. What's wrong with me? And then I said, oh, my gosh. There's this formula that says, profit comes last and last means not important. First is things that get done. What if I put profit first? So it was things like that I started writing down. I will tell you, I still had to survive. I still had to make money. So I started doing any gig I could, really. Consulting gigs. A friend of mine needed a loan. He was applying for a major loan for his business. And he says, hey, do you want to do a loan application? Never done one before. He's like, some guy quoted me, 15,000, if you want it, you can do it. And I said, 15,000 works for you. That'll cover me for six months. I'm in. And I was sitting there writing loan applications for him while writing notes about what I didn't understand about business. I also set a vision for myself of writing a book. Because I noticed in this journal, I have so many thoughts here. Maybe it's gonna be a service to someone else. So I started compiling a book. I will tell you another thing that worked to my advantage is I didn't really know how quote unquote difficult it is to be an entrepreneur. So I went in blind, which was the greatest thing, because if I talked to other authors, I would have been dissuaded from ever doing it. But I went into it and I also met with Tim Ferriss by chance. We were on a television show that I got him by chance.

Love that guy. Love that guy. He's so awesome.

Freaking awesome. We're in the green room and then I'm sitting. I have even a picture of my house sitting across the table from Tim Ferriss. He had just written Four Hour Workweek. So he was just hitting it big. And he was doing the interview circuit. And I said, hey, man, can you make money selling books? Because everyone else told me he won't. And he looks around and goes, are you fucking kidding me? Because you can become a millionaire writing books. I was like, thank you, thank you, thank you. And you can become a millionaire?

Sure.

Writing now.

Now, are you suggesting. Because. Because I think here's where the misnomer is. Are you suggesting you've made millions off of the sale of the book or what the book did to build your trust and authority?

Okay, so. So that's a great question. I've made millions of selling books, and I've built organizations behind them. That brings in other things. So speaking engagements, there's always other revenue sources. But that what I experience and what Tim experiences at a 10 times or 100 times the level I am sure is on book sales alone. Like, I could technically stop doing everything in my life and just live off royalties for a period of time, perhaps a long period of time is making that much money. And that's not typical of authors. And it didn't happen overnight. It took a long time. And profit first was a big help in getting there.

Well, you tell that. You tell the story in here about your. What was it, your garage or somewhere? And they weren't. Nobody was selling them. You couldn't even give it to your mother. I think my mother.

My mother didn't buy one.

Yeah, that's what it was.

My first book was Toilet Paper Entrepreneur. And this is before I met Tim. Before I really understood what.

Okay, okay.

And so I released that book. And it's true, on the launch, my mother didn't buy a book. My mother didn't even know it existed. Like, no one bought a book. But I was so confident. I sell tons. I had 20,000 books. I borrowed money to get books. And they sat there in my house. It was embarrassing, but that weight pushed me forward. Like, I had to get rid of this stuff. And I believed in the book too. So I didn't think I was like, dumping shit. I thought I had good inventory, good stuff. And I started hustling like I never hustled in my life. Well, I love what.

I love what you talk about. Even in Get Different. You tell a little bit more of this story in detail and how you just figured, if I build it, they will come.

Yeah.

And it sounds very familiar. Look, I have, you know, in my field, I have a pretty unique background. Yes. I'm a clinical audiologist. I received my PhD in neuroscience from MIT and Harvard Medical School. Like, I'm definitely different than most people. And. And so I thought, foolish me, I thought if I open a practice in hearing healthcare in my community, that people would be knocking down my doors.

Totally.

Guess what, Mike? It didn't happen.

Nothing. The only ringing was a ringing in your ears. It's called tinnitus. Or tinnitus.

It doesn't say it either way.

So I have tinnitus.

Okay, well, we should talk about that.

But I got a baseline check last year. Actually, two weeks ago. Okay. Yeah. So I'm going for an annual audio, so. Thank you.

So my new book is all. All is called Preventing Decline, Advances in the Treatment of Hearing Loss and tinnitus. I will make sure. I'll get you a copy. I'll get it to Aaron and make sure.

Yeah. Thank you. I love it. You know, it was a shame. Was. I go in the doctor's office and it was all geriatrics. These are. People are looking for cures and not people are being preventative. And when I met the doctor, I said, how many times you get someone like, you know, in their early 50s, hearing. He's like a hearing problem. Because no one.

The answer. The answer is not enough.

Yeah. Not enough. That. Yeah. Yeah.

So. Okay. All right. I don't want to get too derailed with the ringing in your ears, but I really. What I want to talk about, because it's. It's very applicable. I mean, it's applicable to everybody. It's applicable to every business. But I really. When I Look at hearing healthcare, which is the field that I'm in. We have a consulting business. We work in. This. I've seen it in my own practice is in terms of pumpkin plan. How do you come to making those decisions of cutting the pumpkin? Right. I mean, that's why I wore the tie today. And I actually have my special scissor here because I'm a huge fan of cutting the pumpkin.

Oh, dude, that is awesome.

But how, you know, I mean, getting there is not easy, Right? Right.

Yeah.

And what is that like for you, even today, with dealing with some bad pumpkins? Because you're trying to grow the prized one, right?

Yeah. So the idea of the pumpkin plan is to grow your business. It's about selectivity. You actually grow by saying no. It's our discipline of declining things. And it's different than the very early stages of the business when you're first starting out. You got to say yes to everything, because we are in survival mode. But to get beyond survival and really to be healthy, we need to be selective, have the right nutrients, and it starts off with great customers. In any business, audiology is included. There's great customers and there's bad customers. The cost of bad customers is tremendous. They are not good profit centers. They don't make money. They bitch and moan and complain. And the emotional cost. I'm trying to go to sleep at night. I'm pissed off about this customer who just sucks yet again, instead of. Yeah.

My analogy at the university. I teach at a university. My analogy has always been the 5% of the trouble students take. Take 95% of your time. And as I was listening to your book, I'm like, that's. That's it. That's it right there. I thought about it in terms of my students, but I never thought about it in terms of my practice and my. And my patients. And it wasn't always the pain in the butt patients, because we have those. But there's also sometimes thinking about working with perhaps, you know, we have these third parties. We have these discount programs. We have. We have Medicaid. Right. I mean, so of course we want to help everybody. But. But can you?

No, you can't. Well, if you try to serve everybody, you start diluting your ability to serve anybody. So those. What we have to do is get rid of the bad customers. When I'm saying they're bad, they're not bad people. They're bad fits. Yes, yes, they're bad fits. And how you do this is you fire customers. What this does is it Starts availing more space. Now, in certain businesses, you can't just go to customers, say, I can't serve you anymore. And in my business in the consulting side, for example, that's exactly what you do. You say, can't serve you anymore. We're done. So when it comes to firing back customers, I think we get stuck in this belief that, well, they still make some money for us and maybe they'll go away on their own. There comes a point where the consequences become even more dire, that the rest of our team is looking at us and saying, oh, you're willing to put up with crap? Oh, we aren't important. This bad customer bitching among us moaning is important. We come second when we have the strength to get rid of that bad customer. It's often that single hand clap in the background where your employees or colleagues are finally like, thank God for doing that. But it also avails now, all this emotional weight. When I get rid of a bad customer, it's within minutes. I feel like, oh, okay, that call's done. All right. March 4th.

Such a relief, isn't it?

Yeah. Never have to worry about them again. And it doesn't happen often now, but maybe once or twice a year, there's someone that gotta get rid of them. And I willfully do it. It's a uncomfortable conversation at times, but it's necessary. And the best thing is those people that I followed up with landed often in a better spot.

So we have a term. The term. The term in our practices and in our consulting is. And people laughing, we're freeing your future.

Yeah, right, Right.

Cause it's just not. It's not a good relationship for either of us. There's no way that I'm losing sleep at night and you think everything is peachy keen.

That's right.

It just doesn't work that way. And then, of course, everybody hopefully lands on their feet and it turns out they find a better fit for them. We're not all meant for each other.

That's correct.

Right. Whether it's a customer, a client, friends. I mean, that's just the way life is. You have to be picky. And in business, you can't be all things to none. I know I only have you for a few more minutes, so I would really like to talk about this concept of get different. And if I could tell you a little bit, and I know you said recently you went in to see your hearing healthcare provider. Kudos to you for doing that. One of the things we're dealing with is there's A lot of outside sort of competition, pardon the pun, but there's a lot of noise in hearing health care, especially with over the counter hearing aids this and that. And so what we've been stressing for years to our clients. And one of the reasons, look, our practice is the number one rated hearing healthcare practice in America. So we've done something right. Because what we've done is we have been different. What are some of the principles that you can review for people that are listening and how they can be different and not worry about what's not in their control?

Yeah, yeah, yeah. So the core framework of get different, it's called dad. An easy to remember acronym, stands for the three stages or the three elements you need to check off for your marketing, your outreach. To be effective, first it must differentiate. And to your point, you do need to break through the white noise that's out there. The human mind is very great or very good at ignoring things. So if we see a stimuli that's not relevant to us, we'll mark it and categorize as not relevant and ignore it going forward. One example is if you ever received a hey, friend email, Keith. It's like the first time I got one, I was like, oh my God, this friend. Who is this? They're so friendly. They don't even use my first name. I love. Right?

Yeah.

And then I was like, oh, it's smar me marketing. Second one I got. I barely pay attention, but I was like, oh, maybe third one. I've never read one again. They're all in the spam box, right? That's called habituation. Our mind is really efficient at discovering what's irrelevant and ignoring it. Therefore, if the best practice in your industry is to market a certain way and everyone's approaching your prospect, postcard mailer, or through that email blast, that is unlikely to be successful because you're. You're in with that noise and they've already been programmed to ignore it. So first, break the pattern. Do different. Do something that's unexpected. I'm not saying outrageous like. I'm not saying you got to dress like Bozo the Clown and go walking around those big floppy shoes and the yakka yakka horn. I'm simply saying you got to do something that makes the customer do the. What was that? Double take.

Yeah, you know that, you know, I'm sure you know the Mark Twain quote, right?

When you.

Basically, I'm paraphrasing. When you see everybody going in one direction, it's time to pause and reflect.

Yeah, right, right. Yeah, yeah.

Really, like why is everybody going. And if everybody's going that way, maybe I should go that way.

Exactly.

I mean in my field, and I mean you probably know the number of how many small business owners there are in my field is 42 million patients that need help. I can't help all of them. Right, right. But I can help a subset of that meet our core values, that meet our, a patient profile, that understand that we provide a real value in a real service. We just have to get that messaging.

Out there and they need you like, thanks for the rallying cry. Like we have responsibility to market if you are better than the alternatives for that customer base. Dammit, we gotta get in front of them. So you do by getting noticed, by being different. The second element is you also must be attractive. Meaning the market you're speaking to has to look at this and say when they do that double take, oh, that's for me. So speak their language, invoke curiosity, entertain or educate. But give them a compelling reason to stay engaged with what you're presenting. Once you differentiate it to get attention you've now attracted, to keep them engaged. The final stage is to compel them to take an action. That's the direct stage in dad. We tell them specifically what to do. And the key here is it must be reasonable and safe. You know, I can't say, hey, you want your ears checked? You want your hearing checked? Send us a deposit for $5,000. We're the best. Yeah, yeah, never, never going to happen. It's too risky. But the other mistake is ambiguity. Like, oh, hey, you want your hearing checked? We wish you good luck with that. Like what? Tell me what the next safe and reasonable step is. It may be, you know, give us your email and we're going to give you the five things to check in on where you can kind of self assess some of the basic stuff you should be able to capable of doing at this age or whatever. Or give us your phone number and we'll, we'll do an automatic hearing check over the phone, which is just a base premise. But what we're trying to do is move them to the final transaction which is in their best interest, but move them where they feel are moving at a safe and reasonable pace.

I like that. Safe and reasonable. And I know what we try to do. I think the way we've termed it is remove risk.

There you go.

Yeah, right. I mean kind of the same potato, potato. So I love that. That's your lesson again. A couple minutes left here because I know you Got a big event tonight. A few questions I have to ask you. Number one, you're inspiring because you are. You're yourself. You are Mike McKowtitz. And you're just. You're unabashed. You. And what is that like? Because there's no way that everybody accepts you. There's no way that everybody accepts Mike's personality from North Jersey. Tough guy, beautiful beard, by the way, but just somebody who is unabashedly themselves. I mean, I'm sure you've had. Had kickback on that.

Scumbag and a tool.

Yeah. Where you're like, forget it. I just. I wrote this book. I know it helps, but I know some people have come to you, said, no, no. Profit first. That's not the way to do it.

Oh, listen, I got. I. I was invited to be the opening keynote at a major CPA conference because of Profit first. And then they read the Governing Body. Read what's about. They said, oh, no, no, this guy's an idiot.

No, he can't be here. What's that like?

I can't say. It's water off my back. Sometimes I sit there and go, you know, maybe they are right. But I will tell you this. They are right from their perspective. Like, I am not made for everyone. But I'll tell you, if I try to placate to everyone, then I serve no one. Like we were talking about earlier. Yeah. So I know that stuff, and sometimes I feel it. But I don't know, maybe it's a little bit Zen. Like, I just know that.

Well, look, we're only human, right? I mean, I'm not. It's not. I'm not, like. It's not something I'm proud of. But I know that a lot of the ways I view treating patients and the importance of it and the value of it and how we have to really get patients to understand has been met by a lot of resistance. I mean, I've been kicked out of Facebook groups. I've been kicked out of this.

Yeah. But I'm.

I'm okay with it. Right. Because I know it's okay. My last book was read by over 100,000 patients. And the reviews came in, those patients started treatment. So I sleep at night knowing that. Right?

Yeah. And I just say I reject other people. I hope I'm kind about it. I don't get in their face, but I'm like, this person totally ain't for me.

Yeah.

So I get it.

So. All right, last question. Because I'm going to respect your time here. I usually ask people what their favorite movie is, but no.

Terminator 2. I'm sorry, go.

What was it?

Terminator 2.

Terminator 2.

Not my. It's not my favorite movie. It is the best movie, period. Next question.

Okay. Favorite beer? Beer.

Beer. Oh, my God.

By the way, Mike, Mike, I don't know if you know this, but I contacted your team this morning and I said I'd actually like to get drunk on the podcast with Mike today. Is he up for it? And they said he's got a big event tonight, so.

Yeah.

And share a beer with you, I'm sure.

Aaron. Big. No way. Modelo. Modelo. It's a lot. Yeah. A Mexican based lager. Salt the rim. You actually salt the rim on a Modelo.

Beautiful. Beautiful.

Okay.

I appreciate that so much, Mike. Thank you for your time. You are awesome. Everybody. You can find Mike Michalowicz online. Read his books. Get different profit first Pumpkin plan. There's a whole bunch of them. Mike, you are awesome. Your beard is awesome. Thank you for your time today, brothers.

Thank you.

Take care, buddy.

Bye bye. All right, bye bye.