How to Start a Business From Nothing (Thank Me Later)

I made my first $100,000 when I was 23 years old, when I opened my first gym location. In this video, I'm going to cover everything I learned from that. And so first, it's going to be how I started it. Next, my first hundred thousand. And then third and most importantly for you, the lessons and tactics that I still use to this day that you can use to help you grow your business. And it felt appropriate to film this video in my current gym in the background, because this is where kind of it all started for me. So let's talk about how this even started. The reason this was the riskiest move in my life was that, one, quitting my job was the hardest thing I ever did. Two, it during a time where, like, the economy still wasn't, like, roaring. It was, like, kind of okay. And I had saved up $50,000 from my job. Now I spent 10 to get into the. The group for the gym owners. I actually signed up for a gym mastermind, and I didn't have a gym, so I had, like, 40,000 left. And then I spent $34,000 opening up the location. So I had $6,000 left, mind you. The rent was five. And so I had exactly the amount of money, like, required to have, like, one month. And so I was like, oh, my God, what am I going to do? And so it was by chance that I went to a different seminar that taught about this thing called Facebook ad. And so I ended up running an ad. And here's the craziest thing of all. I actually found this out years later. $4,972 in cash collected in the first month. And my rent was $4,972. I only found this out years later when I looked at my processing records, and I was like, I'm not. I'm not a divine, you know, dude, but wild. And so I basically had no money, and all my money was in the gym equipment, and I spent the thousand bucks, basically that I had on these ads. And so when I started this one, I was like, man, this is. This is hard. So first big lesson that I learned was, when you're poor, barter, all right? And so I had basically no money, and so. But I needed stuff. So I needed people who could train. I needed people who could clean. And so I had people come in and be like, I can't afford to do this. And I'd be like, hey, well, you want to clean the gym? And if you clean the gym, I'll let you attend the classes, because the Cl, like someone else attending a class. For me wasn't really any cost for me. My costs were fixed. So anything that I could basically barter for $200 a month or $300 a month of services, I would just. I did everything like that. I was like, hey, can you fix my computer? Want personal training? Like, I did that. Like, I got my first printer and scanner from a guy who had an IT company because he felt bad for me because I was doing everything on paper. And he said, you shouldn't do this. And I just did PT lessons for him so that he would pay for that. And so, like, I just, I barter like crazy. I still barter to this day because, guys, it's tax efficient. Neither party has to pay taxes on anything, right? It's the most efficient form of trade. So if you have the opportunity to do it, do it. On top of that, I actually had a client who was a food, like a food prep person. And so they would end up bringing a refrigerator and I could eat the food that they would bring for free for having access to my members. So, like I'm saying, literally everything, my laundry, I had a different client who did my laundry for me. Like, everything that would take any of my time or money I just traded for so that I could spend all my time in the gym just trying to make this thing work. So if you're like, okay, well how do I apply this to me? Look at every single line item that you have on your, like your expenses, right? Like your credit card or whatever, your bank account. And anything that I had, I just tried to find somebody who did that thing. And I just was opportunistic looking. If somebody came in and they're like, oh, I do. Because I would always be like, what do you do? And they would tell me, I'd be like, oh, I actually need one of that one. Want to do this? And this happened a lot. And I would just keep asking for less and less service until it was the amount of money that was the equivalent of a membership. And then I was like, sick. Let's do that. My first ads, I got a videographer who came in because it was California, right? And this guy comes in, he's low, he's a small time videographer. And he was like, I can't afford this. And I was like, well, I can't afford you. So. And so he recorded my first. Some of my first ads for the gym, which actually ended up crushing. And so like, just. You got like bartering is one. But. But I'll Put it second here, which is like, be creative. And I think in order to do this, too, is that you just can't have an ego. Now, I was lucky that I was, you know, 23 and, you know, poor, and. And so, like, I had no shame for asking. I was like, please, like, help. I, like, like, I need it. And so I think that a lot of. I'll just. I'll just be honest with you guys. I see a lot of Yalls Instagrams, you know who you are, and a lot of you guys are posturing and pretending like you have something that you don't. And it actually. I think it actually does a lot of disservice to you because if you're like, hey, I need help. Hey, I'm trying to build this thing, people will reach out and help people be way more. If you pretend like you're, you know, you've got it all figured out, no one's going to try and help you. And I think at that time, it's like when. Like when you're earlier on is when you want all the lessons you want all the favors you can get. And the way that I could get extra calories in is that I would actually. With the food prep stuff, I would sell clients on food prep, and sometimes some of them wouldn't pick up all their meals. It happens. And so I would wait for the food to expire, and then as soon as it expired, we weren't allowed to distribute it anymore. And so I would just take it and I would eat all of the food. Expired. It's fine. I called the people, and if they didn't respond, then I would. Then I would take it. And that's. That's how I fed myself. And for those of you who have a moral quandary with me, suck it. Next thing, boy was trying to eat. I was growing. All right, now, number two is that when you're early, you need tactics, all right? Which is why I make a lot of the videos that I do. Actually, be fair. You need tactics at all levels, but especially when you're starting out because you're not really thinking in terms of strategy. You're just like, shoot. What fire should I have in front of me? I got to pay bills. Like, let's get this done. And so I joined this mastermind of a guy who had a really successful gym. Stand back. Tr. And he had a group of, I think, probably like 30 or 40 gym owners who kind of paid him to, like, kind of learn some of the stuff that he had. So I showed up to this first Mastermind, and I'm 20, 22 years old at the time, and I didn't own a gym. But the most valuable thing that I got is so many mistakes that I didn't have to make that all of these guys had made when they started their gyms. And so I just went around the room and I was like, hey, so what kind of location were you looking for? And they were like, oh, definitely don't do it in these markets. You definitely want to have this kind of square footage. Try to get a layout that only has this much office and this much warehouse. I was like. And they're like, oh, yeah, parking. Make sure you. And so all of these things. And I was like, okay, well, I'm going to buy this equipment. They're like, oh, no, don't buy that equipment. That stuff springs really fast. Buy from this brand and I've got a guy. I'll hook you up with them. And like, within the first conversation, I was like, oh, my God, I saved the entire cost of what I paid in the first day. And basically, that was such a reinforcing experience for me that whenever I enter anything, I always just pay if I can to just get access to people who are already doing it, and they can just tell me all the mistakes that I can avoid upfront. And this is why I invested in school. Like, I think communities are the future anyways. They also told me so on top of that, what I would do is on my weekends, when I had time, which was basically never, but when I did have time, I would make weekend trips to the other gym owners in the community. And so then I would just basically shadow them and pester them like a leech. And I would just go there and I would just ask as many questions as I could be. Like, why do you do that? And then when they sign up, what do you do? Where do you put the contract? I asked a hundred questions. But the thing is, is all these guys are older than me, and they, like, kind of felt bad. They were like, hey, this is what I do. This is what I do. This what I do. And I just took every note I possibly could. And so I think the meta lesson for me was that the thing that has carried me and to this day has just been the intention to keep Lear. And I think that life, like, for me, the meaning of life is learning is to change behavior based on the conditions. And so I hope that I live the end of my life differently than I do now. Hopefully, I'll have learned and so I went to the gyms, I asked tons of questions and all of those little things that I learned I would try. And not all of them worked, obviously, but some of them did. And so I just tossed out the stuff that didn't work. I wasn't like, screw that guy for trying to help me for free because he gave me a tack that didn't work. I was like, well, he gave me another one that did. So works for me. And so I'll give you this little thing which is that when you're starting out, it's actually one of the only times that people are willing to help you and so take advantage of that. Like this is a strategic advantage that you have when you're starting out, is that people are willing to help, especially other entrepreneurs. It's like fairly common. Like most entrepreneurs are willing to help people one or two steps behind them. Now this was a big mistake that I made, which is number three, which after I learned this, I forever changed how I do every business. All right, which is that pre sales. So I thought that the way that I should make money because I was like, I don't have any money. I need to start this gym as fast as possible in order to make money. Completely wrong. We need to start doing marketing and selling as fast as possible and then delay delivering as long as possible. Because every location I opened after my first, after having learned this lesson, I was like, oh, we're going to pre sell for three months and we're just going to keep marketing, keep selling, keep collecting cash, keep getting members, keep getting members, keep getting memberships, right? And then only like basically as long as possible because that's when all your costs start. So it's like just market and sell. Get people to prepay for, you know, three months, six months, a year, right? Get people into in a trial memberships that kick in later. Like whatever you need to do in the beginning to just start kind of with a bank. And so if you're brick and mortar more than anything, obviously every kind of business would benefit from a grand opening strategy. But if you're brick and mortar, grand opening strategy is, is one of the core ways you scale like you cannot scale without having a killer grand opening strategy. Look at every, every brick and mortar retail food, gyms, like, you know, massage, it doesn't matter. They have a crazy grand opening strategy. Otherwise like it takes. So it takes way too long to get your money back, right? You have to be able to get to be profitable as soon as humanly possible. And so what I did with pre sales as I got more sophisticated is that if I, instead of being like, oh, I think I would open up a location in, you know, la Habra, what I would do is I would run ads. So I'd spend like $500 or a thousand dollars in five or ten markets and I would see where I got the lowest lead costs. And so as soon as I saw that I was like, oh well, some people are like, oh man, it's such like dude, that guy's market is so easy compared to mine. And I'm going to be real with you, some markets are easier than others. Like there are better and worse markets. Absolutely for any type of service. But guess how you can pay down that risk. So instead of signing a lease, doing a build out and then beginning to market to figure out whether it's a good, a good location or do it first, worst case scenario, you spend the 5,000 or $10,000 in ads across 10 locations and you pick a perfect spot, a 1 out of 10 spot rather than a who knows what location. So instead of rolling the dice, pay $10,000 for pre sale insurance of checking. And it's like, okay, if you're wondering, well what do you do when, when, when, when people opt in and then you don't have a location, do what 99% of business owners do anyways. Ignore the leads, right? That's what everyone else does. So like don't worry about it, like you'll be okay. They'll just keep living their lives and you paid Google and Google got their benefit and everybody's happy, right? But you get to avoid signing a five year lease and for 500 grand or whatever it is that you're signing for a bad spot. And I want to be really clear, I can't believe I have to say this. Don't sell that you're not going to deliver. If for whatever reason you think you're not going to open up a location for, for sake, don't take money and not deliver. Like a really great way to just have people hate you. So don't do that and get in trouble. Don't do that. So the next big lesson I have was variation in ads. All right, so I'm explain this. This skill ended up benefiting me for the rest of my life. And so when most marketers advertise on a national level, they get really lazy because they're used to running an ad and having an ad work for a month, two months, three months. Sometimes like YouTube ads are run for six months. I wasn't that guy at all. I had to make new ads like every week because my mocha market's so small. Right. And so in the in hundred million dollar offers, the last chapter, I talk about the magic headline formula. And so basically what I, what I figured out was that I can't, I don't want to change my service. Right. I don't want to start like offering back massages or something at my gym like that. I don't. You don't want to change your core thing. But what I want to do is change the wrapping paper. So it's the same present. I just present it differently. And so that's how I got, you know, that's how I figured out. Oh, okay. Lean by Halloween Slim for Santa, Big booty boot camp. 42 day detox, 42 day fix. 42 day transformation. Six week transformation. Six week challenge. Like. I learned how to permutate my promotional headlines because I had to. And then later on, once I went to a national level, I was willing and able to make so much more variation in my ads and my copy and my lead magnets than my competitors because all of them were spoiled in this world where they only have to make a couple ads a month. I was like, I'm used to making 20 or 30 a week. And so this is where I actually learned both the volume of creative and the variation. And it's really just slight variation in the naming conventions of the promotions that I'm running. All right? And so it might, you want to make it look like a different offer, but you're still, I mean, what's it going to be? It's not going to be, you're going to work out a couple times a week. You're going to eat differently, you have a trainer. Like, the core deliverable is the same. It's not going to change, but you just change the way it looks to change the way it feels. And that's what keeps it new in a market. Yeah. And what's changed between what I learned this lesson and today is that the creative itself is part of the targeting now. And so who you have in the ads, like, like attracts like. And so if you want more girls, have more girls in the ads, you want more guys, have more guys in the ads. Want Big Jack guys, have more Big Jack guys. If like. And so this is something that is more new now than then because then the targeting was much more basic. But big picture, if you're local, you don't need to worry too much about this because you're just going to drop a pen and say everybody in this local area. But as you go national, that's where it becomes a little bit more important. And real quick, I spent 200 hours this year just making this one project for you, which is the a hundred million dollar scaling roadmap. And I broke up the stages of business into 10 stages. And you can identify where you're at by simply just putting in your business information. You go to acquisition.com roadmap and it'll spit out this custom report that tells you what the constraints are at that current level and what you need to do to graduate and get to the next level. This is our gift to you absolutely free. On the thank you page. You can book a call with our team and we'd love to help you figure that out and ideally get past it. So this is how I was generating leads. But then what was the actual offer that really like made or broke the business. Right. And so this is where I learned the six week challenge offer. And the six week challenge offer is a win your money back offer. And there was also an unconditional money back guarantee that I paired with this. So it just made it an absolute hurricane of an offer. And if you're curious about guarantees, I have a chapter on guarantees in general, the guarantee formula, which is just if you don't achieve X by Y time, I will Z, which is what's the consideration. So you have some sort of thing you're promising, there's some sort of timeline, you're promising it on some terms and then you have what you'll give in consideration. And so one of the big mistakes people make when they're doing any kind of guarantee offer is that they say, I guarantee this. Yeah, but you have to say the or white. Right? The or else. And it's the or what that gives the guarantee power. Just the word guarantee is not going to do nearly as much as the stakes you're putting on the line. Now inside of the book, I actually have 11 of my favorite guarantees that have, I have used and work. And so you can, you can check those out. But the two guarantees that I use most frequently were a service based guarantee and an unconditional guarantee. All right, so let me explain what those are. So a service based guarantee is, hey, I'm going to help you achieve X by Y, but if you don't, I'll continue to work with you until you do. Now this matters more importantly, when there's actual cost associated with delivery. If you're like, I will, you know, you're You're a digital person. It's like, yeah, you get access to this course for six weeks and then if you don't hit the goal, you keep getting access for another six weeks. It's like, access is not that valuable. Of like, I didn't hit it, but we were actually training people. And so for me, that was like real stakes on the line and it was very compelling. The second guarantee that I offered was an unconditional guarantee, which is that during the six weeks, if at any point you feel like you haven't gotten $500 of value from us independent of your results, I'll give you the money back. I says that means that five weeks, six days and 23 hours from now, if you don't think that we gave you the value, I'll give you the money back. And I'm telling you, like, that closed so many sales for me. And because we really obsessed on delivery, my team knowing that that guarantee exists forced them to just level up and be like, we just have to bring it every day. And I want to tell you the actual number, which is over the years of doing it, I had two people who asked me for the money back on the unconditional. Now there were people who obviously hit the goal of losing 20 pounds in the six weeks and they won it, which is fine. And that's kind of, that was the, that was the deal, right? Which if you aren't familiar with the offer, it was lose 20 pounds in six weeks. Obviously this for people who are over a certain BMI, if they were below the BMI would just say 10% of your body weight. So if it was like 140 pound, you know, person, and they're like a little overweight, they lose 14 pounds in six weeks. So it's like two pounds a week or two, two and change. And mind you, like, I knew that people, people were like, oh in the comments, like, oh my God, that's unhealthy. People gamed it. I know that. So when they came to weigh in, day they were, they had six pounds of water and, you know, bricks in their pockets. Like, I, I knew people were gaming it, right? It's like, to be clear, and at the end they're like dehydrated, like raisin, you know, they're naked on there, just like, you know, covering, covering themselves to like get underweight. So like the wheat, like I knew there was a five or six pound give on both sides that were happening, right? But we had almost 80% of people were hitting the goal at the time. And so it was very compelling. And the reality is that most people who work out for six weeks straight want to keep working out. And so that's why the offer worked. It got people really motivated in the short term. But then it was like, hey, listen, Cindy, you've lost 14 pounds. That's amazing. You told me your goal is 50, though. Yeah. Okay, well, it's going to take longer than that, right? Yeah, I know it's going to take longer than that. Cool. Then let's just get you going for a year and actually get you there for good. Right. So it was very easy transition, even though people came in for a defined program on the front end. Now, the beauty of this particular offer was that compared to the rest of the industry, everyone else is giving free trials, free months or low barrier offers, like $21 for 20 days, things like that. And so when they were trying to market against me, I was making $500 in the, in the first transaction. And then 48 hours later, I was selling another 200, $300 of supplements. I had so much more cash up front, I could wildly outspend them for them. They have $21, okay, basically nothing. And then they have to wait three weeks to convert into a normal membership price of 99, 199amonth. And it would take them three months to just get what I got in the first transaction. And because of that, I was able to massively outspend them. And so by doing that play, I was able to dominate markets. And the beauty of the guarantee, the way I had it structured, was one, obviously there was a goal. And if they won their money back by hitting the goal, they had it. It was straight up, they have, they have the money back. Sometimes some, like later on, we started doing it as credit, saying, hey, this is credit. So we'll credit it back to any other services. You just have to disclaim in the advertising, all that stuff, obey the laws of your area, whatever. Now, beyond that, what it enabled me to do is do something that is one of my favorite clothes ever, which is the best case, worst case close. And so I'd be like, hey, Cindy, let's just zoom out for a second. Best case scenario, you change your life forever. You finally get in shape, you find a community of people, and you actually stick with this for life. That's best case. Worst case scenario, you work out for six weeks, basically for free. You tell me I suck and I give you your money back. You have nothing to lose. Except the only thing that is more guaranteed than that. Is that if you leave, you're definitely not going to get to where you want to go. So what do you want to do? Like it was a risk free move and that closed a lot. So all of this stuff is what helped me get $200,000, multiple hundred thousand dollars in revenue the first year. Now I also had a decent amount of profit that was left over. But the thing is, is that I didn't take that money out of the business. I left the cash in the business. And then when I opened my second location, I took that cash from my first location and basically spent it all on the second. Right. It cost me 250 grand for the second location, which was a big mistake. I way overspent because my ego was tied to it. But the thing is, is that it, it took years before I actually ended up actually taking money out of the business and putting it in my personal bank account. The richest I've ever felt, which I talk about in the last story of this book, was when I put a hundred thousand dollars into my bank account from the launch business. And so I kept doubling down on new location, new location, new location, new location. And so I felt like I was living on like a razor's edge because like I basically had, I was really asset rich and cash poor. I just had all these locations, all this equipment, all this payroll due every month. And so there was cash in all the bank accounts of the businesses, but like nothing in mind. And I think if I could do it over again, I would have said, dude, like what's the, the rush? Like why are you rushing? Like take money out, like get yourself set up so you can breathe. And so I think that I was running on such high like stress at all times that it, it dramatically impacted my ability to make good decisions because like there is no finish line. There's no, like, there's no award I get. Like it, like, it's not like there's a network effect in gyms. Like you just have to keep executing really well for a very long period of time. And then eventually you can build something that has hundreds and thousands of locations. But like you still have to run a really good business. And I just had this artificial sense of rush because I was trying to prove myself to everyone in my head that didn't even care about me anyways. Now the interesting thing with this whole challenge thing is that it took me a while to get good at it. So the first challenge I ever ran, only 15% of people lost the weight. And what's interesting is that between Then and, you know, a year later, multiple years later, like, we were almost 80%. But, like, fundamentally, we still had more or less the same workouts. And the meal plans that I provided in terms of the calorie restriction set were basically the same thing. And so it's like, what was the difference? And so the difference was I actually learned how to operate a business. Number two is I really leaned onto accountability, which is like, make reminding people to show up to the gym, reminding people to follow their meal plans, telling people they have to weigh on a regular basis, making sure they're documenting that publicly. Like, I started doing all these little things, right? There was no one thing that made. It was just like, every time, we just got better and better and better. So even though the stakes were there with the money, that actually was enough to motivate some people. But the reality is that, like, I should have just made it easier. So I, like, took the meal plans and I made them color coded and I made them. They didn't have to weigh anything. They have to count. Like, I learned a lot of things that made it more accessible to people who were just getting started, because I was starting as I was starting with beginners, but I was an advanced, you know, fitness person at the time. I had multiple state records. Like, I was like, I was hardcore in it, but, like, the people I was serving were not me. And it took me a minute to learn that. And I'll tell you how I figured this out. So I remember freaking out near the end of the very first challenge I ever ran. I call my dad up. He's a physician, and I was like, I think I'm crashing. People who have hormones and metabolism, maybe I'm. I'm restricting their calories too much. That's why they're. They're not losing weight. And any experienced doctor will tell you, he's like, oh, they're just not adhering. And I was like, no, it's obviously not that. It's obviously like some sort of scientific thing. And obviously he was right. It was just. No one was. No one was following it, right? And so one of the things that I learned, this is good for anybody who has clients who have to do anything to get a result. So doesn't matter what you sell, but if you have a service where a customer has to take action in order to see an outcome, what I learned was asking specific questions. So when I would ask people, hey, did you follow everything in the beginning? They're all like, oh, yeah, follow everything to the T100% and then I could literally follow that up with, okay, so how many days out of seven did you eat all three meals exactly to plan with nothing else? And they'd be like, oh, I mean, at least three days a week. And I'd be like, you just said that you followed it a hundred percent. And then the next question was, how many days out of seven did you eat all three and nothing else? They were like, oh, yeah, only three, right? And so I got more specific about it, like, how many days did you have three and two shakes or whatever. And they would be like, oh, that's what I had. Now if anybody who's like listening to this is like, ah, fitness stuff, point being is that ask specific questions and you'll get much more specific answers. Now the sixth thing that kind of got me to that $100,000 plus was sell the vacation, not the plane flight. So I want to give you a visual on this because I think it's really important like this. When I understood how this worked for sales, it really changed. I mean, how much money I made. So what happens is, let's say somebody's here, right? They're sad because they're like, oh, I'm sad and my eyes are really weird. I look like a Cyclops, right? I'd be sad if I look like that, right? And they want to get over here, right? They want to be happy version of them who's got eyes that are evenly spaced and has a smiley face. Now there's going to be some process of getting them here, right? Now what happens is most salespeople will talk about all of the steps of getting here, right? That's what they're going to talk about. And the thing is, is that that's like telling somebody, hey, I want you to go on this vacation. And so what's going to be required is you're going to have to wake up at the crack of dawn, you're going to have to pack your stuff the night before, you're going to have to be stressed out. You have to wait in line, you have to pull your idea, they're going to weigh it. You might have to pay an extra bill, right? And then once you get to the plane, they're going to make you sit for another hour and then you're going to get called up like cattle and put into the, and put into the, the compartment of the plane and you're going to have somebody sneezing and coughing next to you. Of course there's going to be a baby on the plane. They're going to be crying the whole time, the food's going to be terrible and you might get jet lagged. There's going to be a delay for sure. And by the way, did I mention the layover? Yeah. You're going to have to do it all again another time in order to get your final location. Now once you get there, you're actually not going to be there. You have to get, you get the point here, right? Painful. That's what most people sales sound like. But instead if I just said, hey, you're here, you want to be in Maui. Let me tell you about Maui and let me tell you how it's not like Baltimore. So Baltimore. It's like it's, it's, it's raining here, right? Oh, that's rain. That's like a. Looks like an octopus or jellyfish. Anyways, that's rain. All right. So it's raining here, right? Like rain. You've got your little umbrella. Very sad, right? It's terrible here. What we want to talk about is the pain of their current situation. Pain increases their, their desire to change. So think about this way. You want to sell at the point of greatest deprivation. So that's why like when someone's in pain is when they want to go to a doctor, right? You want to solve that. And so we want to remind them of the pain. So you want to talk about them, where they're currently at, all the problems that exist. Then we say, cool. Well let me tell you about Maui. Maui's got beautiful clear water. It's got white, white sand, very fine. It's almost like powder. When you're stepping into it, you're going to have poolside service and oceanside service, depending on what you want. And you're going to have a cabana boy who's got little drinks, the little umbrellas in it. And you're going to be sipping there, having a time of your life, creating memories that you will have for until you die. And the thing is is that this vacation isn't just going to pay dividends when you're there. You're going to enjoy it, but you're going to enjoy it two other times every day leading up to it. You're going to be looking forward to it. It's going to make every day better. And then afterwards you're going to be able to look back at those pictures and re experience it. And so it's not even about the vacation. It's about something that you're going to be able to use and think about for the rest of your life. Right. Notice what I didn't talk about the plane flight, the tsa, the guy, the baby, you know, smoking cigarettes next to you. I don't know what this baby's doing, but he's doing something crazy. And so the point is, is that you want to focus on the pain of their current and then what the experience of the result will be like. And then them signing up is the process of getting there. Now, this part's key number seven was the role of bonuses and discounts. Okay. Now, in the beginning, and I think I learned this really early on, and so I've never been a discounter when it comes to my core product. Now, very different than saying, like, I'm going to peel a piece off, it's going to be a lead magnet. That's a different situation. But if someone wants me to discount my core service, the answer is always no, because we don't negotiate with price terrorists. So what do you do instead? So I'll give you two different things that have worked really well for me. So number one is that if somebody asks for a discount, what I would prefer to do is just add a bonus. If somebody asks for a discount, the first answer I usually says, well, I could do it for more, right? And a lot of times that gets people to buy. Now, if they still don't want to buy, they say, okay, how about this? Because maybe they're like, I literally can't, like, okay, can you refer me three friends? If you refer me three friends, I'll give you that discount, which is different because it changes the term. So if someone else finds out, hey, you gave Susie sign up for $400, and you made me sign up for five. And I'm like, oh, dude, bring three friends. I'll give you the hundred bucks right now. And they're like, oh, she didn't say that. I'm like, yeah, I changed the terms, right? And so you can use discounts as bartering tools to have them advertise for you. So, like, I'll give you 100 bucks off if you also make reviews on all these platforms or do other things. Basically, any kind of discount I'll have, my terms will change to all the advertising they will allow me to do, which is worth more to me than whatever the discount is. Now, if somebody presents with a specific obstacle, I'll give you the actual story. So the first time I realized this, there was this lady business professional had the money. She was like, the money's not a problem. I was like, okay. She said, the issue is I travel a lot for work. And she's like, so how am I going to be able to stick with the plan when I'm not here? She was like, do you have a travel meal plan? And I was like, well, I don't. And she's like, well, that's kind of a. Kind of a deal breaker for me. And I was like, okay, what if I made you a travel meal plan so that every time you travel, you know how to order at the restaurant so you can eat out and actually, like, you know, keep with this when you're gone? And she was like, oh, if you can do that for me, I'm in. And so I made that thing for that one lady. And then for every other person after that, when they'd come in and say, hey, what happens if I travel or I have to go somewhere for work? I have this vacation in the middle. What do I do? I'd be like, oh, I'll give you the travel plan. And then, boom, the obstacle is done. And so what happened is I started collecting kind of all of these obstacles that people would present with for the reasons that they wouldn't buy. And then I ended up making things. So I made a budget guide meal plan. So it's like, I can afford the thing, but I can't afford the food. I'm like, oh, what are you spending on food right now? Cool. This budget groceries is cost less than 40 bucks a week, and you'll be able to stick the calories and lose the weight. And they're like, oh, that's amazing. I might even save money on this plan. And they're like, what if I'm on the go? I'm like, oh, I've got the shakes guide. Oh, what if I, like, what if I don't know what to eat for breakfast, lunch, and dinner? Okay, well, not only will you follow the plan, I actually give you specific breakfast lunches and dinners that you can make with zero prep. Oh, what about working out when I'm away? Oh, that's why I have my while you're away workout guide. Right. What about if I can't make it in the gym because of time constraints, can I work out at home? Yep. I have my at home workout guide. And so basically every single thing that people would present with, I would take the one time effort of making a beautiful solution for them. And they're like, wow, you went above and beyond. But then I took that templated solution and I stuck it in my stack so that when somebody would talk to me and they'd bring up an obstacle, be like, oh, don't worry, something like this, would that help? And they're like, oh my God, that'd be amazing. And so I wouldn't, in a one on one selling situation different than group sales, I would have my big stack of bonuses in my back pocket so that if they presented with it, I would just match their objection with the bonus that would overcome it. So this was a, this was a pretty terrible thing in terms of lessons, which was overspending. So what made my first location kind of like so successful was that I was there and I went above and beyond for customers. And I tried to, you know, make everyone happy. And people could tell that I wasn't like rolling in money, you know, like, you know, I had, I had these sandbags that like, there's nice sandbags so you can buy that, like fitness sandbags. I went to Home Depot and just bought sandbags and then just tape them with duct tape and people just like would carry these like babies around of sand, right? And so when my second location happened, I saved all this money up and I put $250,000 in the second location. So like I spent. What are those eight times or whatever is more on my second location. My first location. And here's the crazy part, it made the same amount of money as my first. And so like, it was way worse returns on capital than my first one. And the thing is, is that I didn't actually understand what made my product good, what made people actually like my stuff. And so people weren't coming to the gym for fancy top tier equipment. They weren't coming for granite countertops and a glass wall, which is what I did. My glass wall. My second location was almost the same price as my entire first location. What they were coming for was the accountability and the quality of the training, quality of the experience, the people they liked. And so that's when it, I mean, it took me $250,000 to learn this lesson, which is that I had to understand, like, what's the job to be done? What's the job that I'm actually accomplishing for the customer, right? Or like, what is my product or service deliver? And so for us, it was community and accountability. Like, people are very lonely. People want to feel like they belong and obviously want to do things that are good for themselves. But what I realized over time is that the people who stuck with it, a lot of them didn't like dramatically change after they'd done their weight loss challenges, but they kept coming Back again and again. And they just liked it because they wanted to look good, feel good. They just wanted to just, like, feel good, see their friends, listen to some music, you know, get a little sweat on, and then they'd go have their margarita Tuesdays or whatever. And I used to get really upset about that, but I was like, but it was because I didn't understand what we were actually doing. What we're really doing was providing a place for people to, like, get away from home and get away from work. It was like that third spot. I think Starbucks talks about that. Like, what's that third location like for us? The gym was that. I think the only way you can really discover this is by actually talking to your customers and just asking them and saying, like, what. What need does this feel for free fulfill for you? Like, what problem does this solve? Like, where does this fit in your life? And I think listening qualitatively to the feedback, you'd find out, like, and the key when you're asking these things is you don't want to lead them on. You don't want to say, like, are we the third location for between your house and your, you know, like, your job? Are we that thing that fills your community hole up? It's like, no, that's not what you're asking. You're just saying you want to keep it super open because you want them to tell you. And what that has helped me with is where I allocate my time in terms of reinvestment in the service or product to make it better. Because it's not better in my eyes. It has to be better in their eyes. Because I spent way too long obsessing over, like, the periodization of the training and, like, and I completely disregarded the music, but, like, the music mattered more to people than, like, the training. Like, in terms of the actual workouts now, the quality of the trainer, different, but, like, how many reps and sets they were doing, how much volume they were doing? Like, they didn't care at all. I mean, shoot, half the time they'd skip a workout or two. So, like, the periodization was irrelevant. Right. But I was so obsessed with it because I was into it. Yeah. And I think. I think the vast majority of business owners spend a huge amount of time solving problems that aren't problems. And so it's like you completely and excellently solve something that only you think is a problem. And so that's where like, this tremendous waste of resources happens. Now, let me tell you the next big lesson I had, which was proof. So what I did was, and I recommend this to every brick and mortar business owner, is if you have a sales area or sales room. These are examples that I have of before and after pictures. Obviously you need permissions and all that stuff from people. Make sure you're following the law, but just showing overwhelming social proof. And so right now, if you have Yelp or you have Google or whatever, there's going to be all these five stars you've gotten. People have left you reviews. Well, what a waste for them to only live there. So screenshot them, go to the dollar store, buy $1 frames and then frame them all. And so when somebody's in your sales office, if all they see around you is before and after pictures of people saying you're great, it's hard for them to be like, well, is this place legit? You're like, I mean, yeah. And then I asked, and this is the question, this is the question I would ask. I say, well, how much proof would you need to see in order to believe? And then the follow up question is, and if they like didn't, you know, like, is that reasonable? Because you tell me when is it that, like 1, 2, 3, just tell me when. 5, 6, 7, 8, just tell me when it's good. 9, 10. They'll be like, no, stop. I get it. I'm like, right? So like at some point it probably isn't about that. It's about something you're afraid of. So what are you afraid of? Right now I'm back in the cell and I'm actually dealing with the real thing. The reason behind the reason. Not the easy one. That's a smokescreen that they're just putting out to not buy. Mostly because, let's be real, someone, at least for a gym, they're scared. They're afraid they're gonna get made fun of. They're afraid they're gonna slip. They're afraid to look stupid. Right? That's the big fears that people. I didn't even realize this when I, it took me a long time to realize that like these are actual fears for people. And it was weird for me. Cause I love the gym. So I'm like, everyone should love the gym. But it wasn't like that at all. Yeah, and so I, I made a whole video about this, like required viewing for business owners. You can go check it out. And inside the video, I basically talk about a flywheel that every business has to have. And I realized I learned it with this business, which is that you're going to get customers in the door. Step one, you're going to get those customers results. Step two, and then step three, you need to use those results to get you more customers. And so that's the flywheel that every business needs to build. And so you have moments in your customer experience or your product experience where customers are going to get these wow moments. Right. Or ideally. Right. And you want to be there at those moments to capture their reaction so that you can feed that into your marketing machine. Right. And so there's, there's the milestones along the way and then obviously the end goal. And so for us, obviously with challenges, we. It was easy to be like, weigh in, way out, big moment, awesome picture video. Is this great? Yeah. Leave us a review. Fantastic. And so trying to engineer that into your customer experience. Primo way to get more customers and enhance your sales. I'm going to finish that by saying proof system and displaying. So it's both, both collection and displaying of the proof. Now, the next one was partners. Now, man, it's taken me a very long time to learn, learn my lessons with partners. All right, so I have this really nice acronym for partners I'm going to share with you. So if you want a partner to join your team, they should. They should accomplish one of the team acronyms, which is mean either they have time that you don't have, they've got expertise that you don't have, they've got assets that you don't have, or they've got money that you don't have. So assets would be like, they've got a brand, they've got a following, they've got an audience, they might have a machine. I mean, whatever, they have something. They have a distribution base of, of customers, they have a network of affiliates, whatever. They have something that you don't have, they have expertise, they have a skill that you don't have. You can't do this without having the skill. They can work and you're predisposed, or they've got money and you need it. Right. But fundamentally, every single partnership should have one or more of these things that they're bringing to the table. It's complimentary. If the worst business partnerships in the world is when two people have the same expertise, get into business together because they're friends, it's like the recipe for bad partnership. Two lessons on partnerships beyond the team framework. Number one is that if one of you is the working partner and somebody else is the outside partner, who's maybe funding it. You need to figure out if you're going to have some sort of salary to live on. This was a mistake that I made. And I basically lived without taking a salary from the business because I brought in partners and they weren't taking a salary, but I was the one working the business, and they weren't. And so I basically lived without taking an income for two years. And so the reason that I'm so sensitive to cheapness and personal finance is because, like, what I made in the first five or six months of me being in business is what I lived on for the next two years. And so I lived on, like $30,000 a year or less. And that's why I was so sensitive to it. The idea is make sure that you have some reasonable compensation if you're going to be the manager of the business, because long term, you need somebody else who's going to be the manager in your stead. So that's a cost that the business is going to have to incur regardless. And you're doing a job in addition to being the owner. So that's like there's. You want to make sure that that's clear. Are you doing a job in the business different than the owner? That's only going to be in the situations when somebody's funding your thing. All right, point one. The second point is that the equity that you give away in the beginning is the most expensive. And so to the degree that you possibly can hold out on giving equity away early now, if you have to bring people in and you absolutely need them, then, sure, that's. That's part of the game. But it's just like, it's so often that someone's like, oh, here's the pie. There's two of us. Boom, here's half. Right? You don't always have to split things evenly between the number of people. There's different value of skills, there's different value of experience. There's knowledge set. So, like, you can bring two people in and each of them can have 5%, and then you have 90. Like, the slices of the pie don't necessarily need to be the same. And a big variable they have there is, are they taking a paycheck or not? Right. And so it's. A lot of this has to come down to one big word, risk. Who's taking on the most risk? And so typically, that is how the pie is sliced. So number 11 was owners. You're like, how is that different than partners? Let me explain. So every brick and mortar. Now, I have a lot of experience with this now, but every brick and mortar business that I know that's been scaled privately, not franchised, which actually still follows the same law, but that scales privately with one or you know, a couple owners that own everything is that they figure out that every brick and mortar location typically needs to do a profit share. They need to have somebody that they have, they have, they have what feels like a stake in the location. So if you look at like Chick Fil a for example, they have their location operators and those operators have a percentage of the profit from each location. Now they're not the majority owners, they don't have controlling, but they can run the day to day operations. And so basically every brick and mortar business that I have seen scale has this thing. Now some people ask the question, well, how much do you give them profit share? I'll tell you how I come to it. I think how much would someone need to make that has the level of skill required to thrive in this position? And so let's say that I think that the skills that are required here would require five years of experience and $150,000 a year. Okay, so I'm going to say the on target earnings ot all right, is 150k. Okay, so what I'd probably do is say, all right, well what is my average location make? And let's say my average location makes $250,000 in profit. All right, well I don't want to give $250,000 in profit straight to the. That doesn't make any sense for you as an owner. Right, so then what do I do? So I would probably do something like this. You get 75k as a base, so 50%. And the other 50%, which would be $75,000, would mean that you would get, let's say 10, whatever, 12.5%. I don't know, the math is here. 12 and a half percent of the profit from the location. Now if a location does really well and does $350,000, then all of a sudden this 12.5% is even more so. Now they're at 185 or whatever. Now if they underperform and let's say they're at 100k, well then they would only get an extra 12.5k. Right. And so then they'd only make whatever that is, $87,000. And so this still keeps them very invested as an operator for the location and feeling the top line and bottom line impacts of what it costs to run the business. And I want this person to be like, I want their picture on the wall. And be like, this is John's location, right? And this is where I love this from a long term perspective because this can become a very easy career path for people. So people who are kind of low, like if you have a business that requires low or medium level skill, somebody can come in, do an amazing job and they're like, what's my long term career path here? It's like, well, if you do an awesome job, I'm happy to put you in our newest location that's across town. So if you want to start that one up, you can start here. But you got to prove yourself over three to five years, right? And so that way they get to know the business, they get to know how it's operated well, and then you can pull them over and then this kind of gives you this organic growth where people have ownership in their futures. And so this took me a really long time to learn and this was a mistake that I can now tell you because now having looked at a lot and we obviously have chains of locations inside of acquisition.com, you want to have this model, at least in my opinion. That's Alex's two cents. And if you're curious how this math works, I'm going to spell it out really easily for you. Right now you have your on target earning of what you think the person would make if they do a normal job. Like you're not going to fire them, they're fine. You then say half of that's going to be base and the other half would be for medium performance. That gets them to the medium outcome. Now if they have exceptional performance, whatever that percentage was, to equal half of the base or half the extra half of their of the on target earnings, then they would get more if it goes up and if it goes down, then that percentage is going to be less. So they're going to be below their own target earnings. That's the earnings for the person. So I didn't do this and it was really hard and if I could do it again, that's what I would have done. Number 12, this is a big one. Nail it before you scale it. So this goes to the whole rush thing, right? I was in this massive rush. To do what? I have no idea. I just, everything was like, everything has to happen tomorrow. Everything has to happen tomorrow. And I ended up making a ton of mistakes not getting locations perfectly situated before starting the next one. And so basically like I'm still selling at location one when I'm starting location two. Right? Just not smart, right? It should have been like, okay, how do we get this so that our churns really low? How do we get it? So that's continuing to compound year over year over year. How do we make sure that we're absolute full capacity? How do we know that, like people are selling and marketing on their own without me? Once that occurs and I let it sit for six months and it's still growing straight, then I can maybe start the next one. Right. And so if you're like thinking through this, my litmus test for this is that, number one, you shouldn't care about your second location before the first one can run without you, period. Number two, don't go to a new one until the old one is growing without you for six months straight. That's my rule of thumb. Six months straight of growth without you doing it. Now, to be clear, a lot of business owners, or small business owners for local business especially, are like, oh, no, this thing runs without me. No, no, no, no, no. I'm not saying like, oh, you don't show up to the gym, therefore it runs the value. There's many things that are required in a business. You're the operator. You don't necessarily train the sessions, you don't necessarily like, do the billing, but like you're still required to make decisions and, and deal with customers, all that stuff. No, we need somebody else who completely encapsulates that business. And here's the deal. This, this goes on number with number 11. Here's how you have the conversation. So, John, I want you to, I want you to be the, the operator for this location. You're going to have a profit share. You're on target earnings is twice what you're currently making. And here's the shtick. Cool. You've been working here for five years. I want to give you that opportunity. Okay, so here's the deal. You're going to make 10% of the profit of this location on one condition. Get it? Yes. Here's the condition. This doesn't ring. That's the deal. So let me explain. Let's role play this. A pipe breaks in the middle of a session. It's leaking out of the ceiling. What do you do? Call a plumber. Right. So skip the call me part and just call the plumber. Okay, let's try it again. Let's say someone has a heart attack on the floor. What are you going to do? Not call you. Correct. Now, someone has a heart attack on the floor, probably would call you, but for the purpose of our illustration, what would you do? First, call 911, because that's what I'm going to do, right? So just think one extra step and then do that thing. And you have permission up to $1,000 of cost to not have to call me. All right? And so want to make sure though, to be clear, you want to give. So this is a good one for, for everybody to write down is that you want to pair responsibility with authority. So when you only have one or the other, it creates problems. If someone has authority, no responsibility, you have an asshole, right? There's tell people to do, but they are not responsible for anything. It's just people just go sticking their nose in other people's business. On the other hand, this is far more common. Business owners give someone the responsibility but not the authority. They see you're responsible for all this stuff and they're like, okay, well I need to do X, Y and Z. And they're like, no, no, no, no, you can't do that without my permission. It's like, well, then they're just handcuffed. They can't do anything, right? So you have to give authority that is equal to the responsibility. If you think that 90% of problems can get solved for $500 or less, then give it to them. If you know that customer escalations, there's a problem with the customer, you say, hey, up to 100% of what a customer spent with us in the last month, you're able to spend on discretionary for people who are upset. So if someone spends $100 with us this month, you can spend 100% of their hundred dollars to make them happy and not have a bad experience. Right. If they're, you know, and this is where like somebody has a new kid, someone's parent died, someone's car breaks out, whatever it is like that, going that extra mile. And using this kind of discretionary fund is what you want to empower a location owner operator to have so they can actually make decisions about you. And so the nail before you scale it concept works across all industries. All right, so like, if you have a software company, if you're losing customers and turning them out, why would you scale it? Like, you don't just like pour more water into a leaky bucket. Why would you do that? If you have an agency and you're, you know, you're like, oh, look, we're, we're, we finally have ads that are converting for us. Yeah, cool, great. That's step one. Don't scale them anymore. See why customers are leaving. And if customers are Consistently leaving. Maybe you're serving the wrong customers and maybe you shouldn't scale because you're just going to create a churn factory. Right? And the thing is, is that the vast majority of businesses are this, they especially small businesses. And this is actually the difference between small businesses, big businesses is that small businesses become medium sized businesses typically by just spending a ton more on marketing sales because they learn how to do it, but they never figured out how to keep customers. And if you never figure that when you're small, you're definitely not going to have it when you're, when you're rich, when you're big, all right? Because it's easier to fix it when you're small. And there's going to be natural degradation of things as things scale. And so if you can't do in your small, it's even harder when you're big. And so you want to nail it first and then as you scale it, keep fixing it so it stays nailed in. A great test for that six months walk away period from point 11 is just take a vacation. Take a one month vacation, see what happens. You'll be able to see what breaks. It's actually a great test. So let me give you, let me give you my, my lesson number 13 I learned from the gyms is unscalable beginnings. So when I started my first location, Huntington Beach, I had one PT client who paid me like $4,000 a month. And it's because they trained five days a week and it was like hour and a half or two hour long sessions. And so it was 10 hours a week of PT basically guaranteed that I would do it them. And so it made me a significant amount every month. And I basically just lived on that. Now is that part of the model? No. But I did it because that's like what allowed me to be more aggressive with the expansion of the business. I could take all the cash to come in, buy new equipment, fix things, whatever, you know, hire more people. And so there are some things that you're going to do in the beginning that will not scale with the business and that's okay. So you just want to make sure that your nail it portion doesn't include the unskillable parts that I still think you should absolutely consider doing to make the whole process a lot easier on yourself. And so it's like if you have your core business, fine, if you have five, five clients who pay you more personalized attention for stuff so you can like live on that money, but part of you is going to Be like, man, I should just do this. And maybe you should, but if you're trying to build an asset that has value independent of your time, then this is what we're building. So I just like, I wouldn't. Yes. Is it a distraction, but being poor is an even bigger distraction. And so it's really like the lesser of which evil, right. If you're like, man, it's just I'm so stressed about payroll and stuff. But like, if you have this other cash flow thing, and to be clear, this isn't woman in the, in the red dress. I'm talking like you're not building another business. It's like you're just straight selling time so that at a higher, you know, a higher ticket for your expertise or something so that you can build this asset. So I'm okay with that. And that sounds like it's contrary to the woman in the red dress, but we're not building two businesses. You're just accepting very high ticket clients that you can on a one, on one basis, not building a separate business, minimizing the time requirement. And so for me, with my personal training client, I did in the middle of the day. So like, it worked out fine for me. So I finished my morning sessions, I would have a couple of hours, I would do two hours, you know, with him, and then I start my evening session. So I basically just started that as my, my evening sessions. And that's just what allowed Alex to eat Chipotle. And if you're like, wait, I thought you ate the expired food. I did that too, but sometimes I wait to it to expire. So I had each pole in the meantime. All right, so this next one's really big, especially if you have a team, which basically anybody who has a business eventually has a team, is that doing is not the same as teaching. So it's one thing to be able to sell. It's another thing to be able to teach, to sell. It's one thing to be able to train. Another thing to be able to teach, to train. One thing be able to run ads. Another thing to be able to teach people run ads. And so I had this kind of ego thing where I loved being the most valuable player, right? I love being able to come in and save the day, put the team my back. And everyone's like, rocky, rocky, you know, whatever, right? And that was something that handicapped me. And so I wanted to be the best salesperson. But what a terrible thing to want if you want to have a business. And so I had to shift my Identity to being. I want to be the best sales teacher. I want to be this best marketing teacher. I want to be the best operations teacher. Right? And by doing that, it shifted how I saw what winning looked like. And so before this, it was like, oh, they went two for six today. I could go in and close five out of six. Okay, cool. Well, that means that you suck as a teacher, not that you're great as a sales guy. And so you have to basically level up your game and think, this is the new identity that I have to be. And this took me. This took me a long time to learn. And I'll tell you, the first time that this was, like, very real for me is that I went home for. For Christmas. This is, like, the first year of the gym, and I was very afraid to do that. And I had trained these girls who had sold tanning before, and so I taught them how to sell the challenge. And I remember when I was driving, I remember where I was. I was driving on the road to go back to my actual house where I lived when I grew up. And I get this phone call, and they're like, yeah, you know, the day ended, and I was like, how'd you do? And they're like, oh, we had. You know, we had. We had five people show sold two. And I was like, you sold them, though? Like, credit card. Like, it ran, like, the whole thing. They were like, yeah, one was paid in full. The other was a split pay. And I was like, hold on. So today, 750 came in like, it. It said successful next to it. And they were like, yeah, they were like, actively like, why is this guy being so weird? And I ended up pulling the car over. And I remember it was, like, one of the few times that I had, like, a real big, emotional, like, experience. One of the few times ever. And I almost got, like, teared up because it was. It was the first moment where I realized, like, I wasn't the one who's going to have to make every dollar in this business. And it was the first moment where I realized that value of transferring a skill to somebody else. Because until then, I just wanted to be mvp. I just wanted to be the best trainer, the best sales guy, best, whatever. But as soon as I gave it someone else, it was like. It was like I tasted freedom. And once I had that, I was like, I'm gonna get great at this. And I think a big part of honestly, the stuff that you guys see today with YouTube and the books and things like that look, was because I shifted My perspective from being like, it's one thing to learn. I have to learn it. I have to learn it so that I can teach it rather than I wanna learn it so that I can be the best person. I don't think I'm the best at basically anything. If I can be one of the best at teaching the thing, then I can help thousands and millions of people, and that's a much higher leverage skill. So the next thing kind of bolts onto that, which is lesson 15 for me, was simple. All right? Simple scales, fancy fails. All right? Now it's like, okay, well, duh. All right, but let me talk about this within the context of systems and training. So a lot of people have these very, very complex sales systems. And I honestly just try and cut more and more things out of the sales stuff that I teach because I want it to be something that someone can immediately pick up. And so the whole, like, closer framework came out of just trying to make this as simple as possible. Clarify why they're here. When they come in, label them with the problem to show that you listen, Ask them, you overview the past, experience their past pain. What have they tried so far? Then sell the vacation, Tell them about our thing, make the offer. If they say no, explain away their concerns. Once they buy, then reinforce the decision. Tell them they did a good job. That's it. That's all we're doing, right? And so I used to have all these, like, really complex things that I tried, like, and it became really hard for people to learn. And then I was like, okay, I just need this so that somebody who has no idea how to sell can go through this thing and then be able to sell afterwards. And I remember when I started launching gyms that the sales training I had in, in total was like an hour and 15 minutes, the whole thing. And what's crazy is that that sales training came from the intention of, like, people have to watch this and at the end to be able to close. And what's so interesting is that I see, like, lots of sales trainings that are, like, sold and things like that on the Internet. They're. They're, you know, they're a hundred hours long. But I had a sales training that was like, just do this, don't do anything else, just do this. And I only had to get them to understand seven steps in this process. And if they could understand the seven steps, they could close. And so I would encourage you to first think, what is the absolute minimum required in order to close out? What is the absolute minimum required in Order to make a great training session, right? And then try and boil it down to the core components rather than make it complicated. Because the complexity piece, again, makes you feel important, like you're so advanced, when in reality, like, there's probably fewer things that matter than you think. All right, so this is a very kind of technical, advanced thing that I learned from the gyms, which is that you want zero cost upsells. Okay, so what does that mean? So I realized early on that people will come into the gym and then I'd sell them service, right? But they also would want other things after that. They would want apparel, they would want apps, they would want food, they would want supplements. Like, there's all these other things, right? And so I realized that it would cost me about 200. Well, later, 200 earlier cost me less. But let's call it 100, 200 to acquire customer. Okay. The question I then asked myself was, is there something that I can sell them that cost me no time? Because selling service cost me time, right? There's something I could sell that cost me no extra effort that could recoup that original cost. And the answer was yes. And so if you sell a service, I think one of the easiest things you can do is upsell products that go with the service that you just make your margin on and you can liquidate your ad cost up front. And so for me, I sold supplements. I'd sell two $300 subs every person. And the margin I made on the supplements was usually enough to cover the cost of all of my advertising every month. So basically, I would just recover all my advertising bill with my supplement so I could spend whatever I wanted to to get customers, because then all of my service revenue was basically gravy on top. And so the goal that I would, like, don't think, oh, that doesn't work for my business. Ask it differently. Think, how could I make something like this work for my business? So, like, if I have a yoga studio, that's like, fine, sell yoga blocks, sell mats, sell. Sell leggings, whatever, because they're going to want that stuff. There's always going to be a couple of the things that someone's going to want when you have a service, typically. And if you're like, well, I can't immediately think of some, fine, then give yourself more than immediately to think about it, because you only have to figure out one or two things that it can change your business wherever. Also, pro tip, if you want, you can, you can sell a guarantee. So guarantees don't have to be free, you can sell a guarantee. So you can sell your normal services. And if for an extra 10%, we'll guarantee this, people will buy a guarantee. And guarantees are basically zero extra cost if they don't take it. And so it's like only one out of ten people who buys a guarantee ends up taking me up on it. It's like, okay, well then 90% of the time it's just profit pro tip. And you can also charge more than 10%, obviously. 17. I learned the power of what I called internal plays. All right, so internal plays are basically internal promotions that you run to your existing customers in the list. And so one of the things I realized is that customers get bored of things and so you just need to sell them more stuff. And so I would say, okay, you know, we have our normal gym membership, but we're going to run a big booty boot camp. We're going to run buns and guns. We're going to run a sex, you know, get your sexy back, whatever, right? And you laugh. But this is, this is, this is how it was, right? I did an abs and arms program for dudes. And the thing is, is it sold. It worked great. But here's the best part, is that I remember the first time I did this was big booty boot camp. So Sam, the guy that I that I sent for, said, hey, send these emails. So I was like, all right, so cool. So I sent these emails that were about big booty boot camp. And the emails all of a sudden, like came back. We were like, I'm in, I'm in, I'm in on my, on my emails. Like, holy cow. And I got 30 people to spend 300 bucks, I mean, $9,000, which it was huge for me right at the time, made $9,000. And the crazy thing is there's a six week program and it was only, it was a 90 minute session once a week. So I got six sessions to $300. I was like, holy. And so with 30 people, I was able to do six sessions and make $9,000. It was $1,500 a session. Like that was so much more than the amount of money that I was normally making per session. And so the thing is, is that these types of plays are, they're just free money. And so what you want to do is I would say, have some sort of promotional cadence where like once a quarter, every 12 weeks or so, you run some sort of defined in thing for your customers. And here's the crazy part, is that in a Business, especially like this, like a gym business, the margins historically are like 12 and a half percent. That's the average, like micro gym margins. It's not a lot. And the average micro gym does like 33,000 a year. So the average gym owner is making like 30 to 40,000 a year. Not a lot. Take home and they're working like 80 hours a week. And so you might hear $9,000 and be like, oh, well, that's nothing. It's like, well, nine times four is 36. You normally take home 36, then making another 36 doubles your income. Would you double your income for like a couple emails four times a year? Yeah. So do it. Right. And so every business has this opportunity is that there's something that you can do a very defined thing. Like there wasn't like big booty boot camp was one body part. Right. And so think about your, your business. Whatever you serve, you probably serve the whole body of someone's business. You serve the whole body of their computer, you solve the whole body of their phone, whatever. And then you say, cool, I'm just going to peel off one portion of that and then say, hey, all my customers. And if you want this one thing like really maxed out and 10% or 20% of the customers would be like, yeah, I'm interested in that. And then boom. And that thing that you end up selling is actually super high margin. Internal plays are almost all profit. You can run them four times a year. Recommend. Yeah, it's, it's all, it's basically all profit because you already pay the cost requiring the customer. And so the only cost is the cost of delivery. So for me, for the successions, if I wanted to, like, you know, charge based on my time, right. I pay a trainer, maybe you know, 20, 20 back then, you know, 20 bucks an hour for, for 90 minutes, I pay $30 times six, 180 bucks for nine grand. 98% margins. Like, what are we talking about? Like, let's do it right. Like, unbelievable. And so those opportunities exist. You just have to find them. Yeah. If I, if I wanted to acquire 30 new customers, I would have to pay $6,000. Right. And so like here, that's why this is free money. And most, most services have, if you at least have a decently designed business model, your gross margin should be 80% or more. And so if you're running 80% gross margins and you sell something, you make $10,000, you make 8 net. That's a great deal. The problem is just all the other costs of the Business. But all those are fixed already. You don't have to pay cost to our customers. You already have your fixed cost covered. So this is just incremental revenue, which typically should be high margin for you. So let me give you a quick one. So here's number 18 is a lot of people. And I read this a lot. Like, people have the, you know, they write books and they make content and they're like, here, here's why this thing works. I really try hard, and you guys are welcome to call me out on it. I try really hard to not say why things work. And I think the reason I do that is because I have no idea. And I don't think anyone else does either. So we make postulates, we create these hypotheses, how these work, but we have no split tests, we have no research, right? So instead I have spent almost no time in my life trying to figure out why things work and just figure out a big bag of things that do work. And I just try to recommend those things. And so on my channel, that's pretty much what I spend my time. I was like, this stuff works. I don't know why it works. I just knew that it works. So run an internal play a couple of times a year. It'll probably make you more money. If you have upsells, try and have them be zero cost, zero work upsells so that you can just make more money upfront, right? If you do it simpler, more people do a good job, right? Like why? I don't know. But when you have fewer steps, it's easier people remember, right? So next little lesson. This is a big one. It's a little lesson, but it's a big one. Agency. If you're a small business owner, there are two core things in every business. Acquiring customers and delivering to those customers. Those are the two core elements of business. Everything else you can outsource. Now, I'm not saying you should outsource it, I'm just saying it's possible to. But like, what is the core business that you actually run? And so if you have a business, then getting customers is a part of that. And so I think agencies have a use, but not as something that you rely on. And so I would recommend learning to acquire customers, which is why I make all the stuff that I do, right? If you're like, how do I acquire customers? I'll show you eight ways how to do it inside of this book. So inside the leads book, I show eight different ways to get customers warm outreach. Cold outreach. Posting content Running ads, getting customer referrals, getting affiliates, other business to refer you, business, getting agencies, right, to run stuff for you. But I'll show you how we do that and the lesson about to share with you. And then employees to do all those things on your behalf. Now, you as a person can only do the core four. You get other people to do these other four things on your behalf. So how does an agency fit into this? So an agency usually has a mastery of some sort of platform or method. So they're either really good at like email outbound and they set appointments for you, or they're really good at making content. They click click clips for you. They're really good at running paid ads on YouTube, really good at running Google Ads. They're really good at SEO. They have some method of getting customers. Okay, my objective with an agency, if I have to do it, is that I want to beg, borrow, and do whatever I need to do in order to get them to teach me how they do it. And I prefer this method because agency owners tend to know how to do this better than people who teach it because they're actually doing it every day. I usually go into the intention with an agency owner to say, hey, here's my intention. I will sign up with you, but I will do it with the intention of learning everything I can from you so I can eventually replace you. And so my actual story around this I tell in the agency chapter in this book, which is that I got on a phone with a bunch of agencies, and they were like three or five thousand dollars a month, and I could not afford that for at all. And so I knew how to run ads at the time because I'd learned from that that weekend boot camp that I did at the very beginning of my gym. But I needed, I needed to get better, right? And so finally it was like the third or fourth call, I was like, hey, man, like, what would it take? That's the magic question. What would it take for you to teach me one on one? He's like, I don't sell my time. And I said, okay, what would it take? It's America. There's a price. I was like, well, you know, would you do it for a million dollars an hour? And he was like, well, yeah. I was like, okay, cool. So there's a price, so you will do it. So just give me a price that you think you would do it for. And he said, 750 an hour. And he said that. And I was like, deal. And so he ended up doing once a week with me for an hour. And he taught me how he would sell my ads. I was like, this way, you don't have to. You don't have to include your team. You have any more, you know, cost of the business, Like, I'll just hop. It's basically just. It's just one call a week, man. 750 bucks. That's all. And so he said, sure. And so for the first few weeks, the deal was I'm the only one who touched at the computer. So you show me what you're doing, but I'm gonna, I'm gonna do it right. And so I'm gonna. So you can tell me where I'm messing up if I get stuck. Once he taught it to me, and if I didn't know how, like, why he was doing something, I was like, explain your decision making process. And then after the sixth time that I6 call that I did, I like, was like, I don't need this guy. I did two more calls. I didn't have anything that came up. And so for $6,000, basically the cost of one month of running this agency, I was able to learn the skill from one of the best agency owners. And then I used that skill for, like, the rest of my advertising career. I learned how to do national ad campaigns, I learned how to do retargeting. And those are the two lessons that I really learned. I didn't know how to do, and that's what I learned. And so if you're a small business owner, mastering how to get customers is one of the most important skills you can have. You can hire an agency, but you do it because you want to learn from them. In my opinion, number 20. So this is a mistake that I made do. This is a crazy mistake. So this is absolute versus relative return. So I remember that I had other gyms in the area, started catching on to the challenge, right? It was working really, really well. And they saw that I was doing well. So then they started running ads. And these guys were more, you know, advanced business owners than me. I was 20 something, whatever. And so I remember this guy moved into the area and he was running ads, and I asked him how much he was spending and he was like, ah. I was like, I think we're spending like 500 a day. And I was like, 500 a day? Holy. And I'm spending like 50 to 100 a day. And so this guy comes in and like 5 to 10x is my spend. I was like, oh my God, he's gonna take all the ad Space. And the thing is, is that he was willing. And I was like, well, what's your return? He's like, ah. He's like, I don't know. I think we're getting like 4 to 1 on it. But that means that he's spending 15 grand and making 60, right? And here I was, you know, spending 1500 bucks a month, being really excited that I'm getting 10 to 1. So I spent 1500, make 15 grand. I net 13 5. This guy spending 15, making 60, netting 45. And I was like, wait a second. So this whole time I was obsessing about, like every little incremental dollar, I was missing the bigger picture, which is like, at some point, you just need to spend more money. You just need to do more. And so I was getting, I was like, oh, no. We went from, we went from, you know, 13 to 1 to 10 to 1. I got to, I got to stop. It's like, no, man. Like, if I could get 2 to 1 on $1 million to make $1 million by spending a million to make 2, I would rather do that than get 10 to 1 on 10 grand. And so the big lesson that I had to learn was that I was obsessed with my roas and not the absolute amount of money that I was making in profit, right? And so if the roas dropped, I would stop spending money. And so the big tldr on this is just focus on the bottom line of, like, how much money am I going to make rather than being as obsessed with those. Now, this is especially around local markets, right? You want to make, I mean, any business, you want to maximize the amount of money you're making. Obviously having big ltv to cac discrepancies is great, and I'm a big advocate of that, but I don't want to do that to the long term detriment of the total amount of money that I make. Don't break what works. All right, so I'll tell you a very sad story. So I had my gym and I had, I kind of like tweaked my, my, my sessions a few times from when I started to, like, try and make them better. And I got to the point where my gym was packed. Like, I, I had two sessions running at any given time. I had a strength session and a cardio session, and it was, it was packed. The brim. I had 40, 50 people and I only have, you know, 3,500 square feet of actual, like, gym space. So it was packed. What's crazy is that because I couldn't fit any more people in. What I decided to do was I decided to cut the session times in half and consolidate it to only one type of session and combine them again. And what happened next was I churned out, like, a third of my customer base because they were like, why'd you change it? It was so great. And it was because I let the capacity tail wag the business dog. And so basically what I should have done was say, oh, I nailed it. I should open another location right now. If I wasn't making enough profit, then I should have fixed my price. If I have huge amount of demand, everybody's showing up and everyone loves it, then I probably had more price flexibility. But basically what I reasoned with myself was, oh, I just need to find a way to fit more people so I can make more money. But it was the wrong. I messed it up. Like, if you finally figure out what actually, like, what people love, that is the hardest thing to do. And so once they love it, if your business model is profitable, don't mess with it. Just do more. Open up more locations. If people love it and it's not profitable, then fix your pricing. Don't fix the product. Like, if they love it, they love it. That's the hardest part. Pricing is easy to change. Changing what you deliver is super tough. That was one of the hardest lessons that I had to learn. And so the most elusive thing is getting customers to absolutely adore your product and service, tell their friends, and bring. I remember what the energy of the gym was like at that point, and it was a terrible mistake for me. Ah, number 22, work. Yeah, lead as we get. As we get further in the numbers, they're just going to get sillier and sillier. No, work your leads. So I realized that when I worked the leads, we got, like, three or four times more sales than if my team worked the leads. And what I realized was the incredible lever that lead nurture had on the throughput of my advertising even larger than the throughput of closing. And so, like, maybe I could close. 80% of people walk in the doors, But a good closer would close, let's say, half. And so the difference between 50% and 80% is a. I don't know what the math is there called a 60 or 70% difference. Okay. But the difference between getting 10% of the leads in the door and 50% of the leads in the door is a 5x difference. And so it made more sense for me to put my leverage on figuring out how to work the leads harder and better and faster than even trying to obsess about close rates. And so this is something. And like, this is for you. I'm like, I'm going to. I'm going to tell you a different story that's from the future. So I was recently talking to a business owner and he was closing 55% of his leads. Leads, not shows, not calls. Leads 55%. And I was like, dude, how are you doing that? He was like, oh, I pay one girl full time. She has no other job but to call leads the moment they come in. And I want to give you an idea of scale here. He gets about two to three leads a day. That's his business. Two to three leads a day, that's all he gets. And he pays a girl full time. And the only job description is be available. That's it. So 24, seven, whenever a lead comes in, you stop what you're doing, you call the lead. That's it. That's the only job she had. But. And think about how crazy it is because as a business owner, you're like, well, I should give them something else. Well, think about this. Most people in his position close 10% of their leads. And we've all heard the statistic that if you call lead within 60 seconds, you have a 391% increase in sales. Okay, 391%. Let me translate that into X's. That's a 4X. It's a 4.9X for business, almost the 5X. If you have something that could 5X the amount of sales that you're getting from the leads that you're working right now, is there something right now that you could do that's more valuable than that? Probably not. And so the question is, or the interesting thing is, is that the cost of actually achieving that is the cost of one maniac that you have to pay to stop whatever they're doing to call the leads. That's it. And so think about what the difference of a 2x3x4x5x in revenue would be for your business in terms of efficiency on the leads that you're currently getting. And then if that number is larger than what it would pay one maniac to call the leads, find the maniac and pay them. And so I figured out way too late that lead nurturer oftentimes is a larger potential throughput. There's a larger discrepancy in performance on nurture than almost any part on acquisition. And so we focus@acquisite.com on that super heavily because it's one of the easiest, lowest risk levers that you don't even have to change any of your marketing or change any of your delivery. You just nurture better. Okay, number 23. So this is going to be a callback, which is never rely on another business to feed yours. Now, I made an entire video about oneitis, which is that if you only have one kind of point of failure, that becomes the weak link in the chain. And so I told you about the gym mastermind that I joined and everybody there was running Groupon. Well, guess what happened when Groupon stopped working. They were all out of luck. Right? You have to. You ideally want to have multiple ways to get customers. Now I like to have multiple ways to get customers as I get bigger. I want to have one channel that I can reliably get customers when I'm starting out. But if it's another business, that's my source. I don't like that. So there's a difference between having a single channel risk versus another business risk. So if another business can choose to shut off my, my leaf flow tomorrow, very risky. And so if I say, okay, I, I do door knocking or I do outbound, that is one channel. And that can scale up usually to about a million dollars a month. And then at that point you can kind of diversify. Now, if you're brick and mortar or local, it's one of those business is that's a little bit different than like the online or national space, which is that it's easier to have multiple streams. Typically with brick and mortar, you're going to have naturally a little bit more word of mouth. It's easy to set up your Google search terms. Winning local SEO, not that hard. Running paid ads, local, not that hard. All right. And so it's more common to have multiple streams open in a local business than it is at a national level. Just because of the nature of basically ease of competition there. The next three lessons are going to be 24, 25, 26, which is close to when I finish the gym. And so my gym, my gym season. And so we're going to end there. So 24, 25, 26. All right. And so all three of these are going to be around people. And so the first thing is around what you have to pay for people. All right. So if you can't pay to get pre great people, you're going to have to work to get great people. So let me put it differently. It is faster to get better people by raising how much you're willing to pay you'll just have better quality candidates that'll come towards you if you raise basically the ticket or the barrier to entry. That being said, I have had exceptional people that came for less. You just have to talk to, like 10 times more people to find those people. So it's basically like in a video game, you have to like grind or pay, right? It's like you, you have to like work to level up or you can pay to level up. Well, if you're poor, you're starting out in your business, it just means that you're going to work. And the work is outreach and running, you know, job postings and doing a lot of interviews and kissing a lot of toads before you find your magic prince, which, hey, I'm glad that you found your magic prince, which was your customer success rep. All right? And so you either got to grind or you got to pay. So that's not number one. That's number 24, but number one for people. All right, number two or number 25, whichever. We say platinum rule. So treat people the way they want to be treated at the way you want to be treated. So I'll tell you this, this really, really crazy story. So my best gym employee of the whole time that I had my gyms was a guy named Jesus. Well, I won't say his whole name. His name was Jesus. And he was the best, the best of everything, right? He was an unbelievable salesperson, unbelievable manager, great trainer, amazing energy. He was in shape. Everybody loved him. I loved him. It was great. So I ended up promoting him to manager. All right, so I'm going to tell you this story. So number 25 is a platinum rule. And this was a really eye opening experience for me. I had an employee that taught me one of the most interesting lessons I've ever learned in managing people. So my single best manager across all my gym locations. Everyone loved him. He was an amazing trainer. He had great energy, he was in shape, he was great at sales. He was awesome. So I ended up promoting him to manager and he did an amazing job. One of the best managers ever had. And at like month six, he came to me and he was like, hey, man, I don't want to be manager anymore. And I was like, what's going on? What's wrong? Like, let's figure this out. And he was like, I just don't like the stress of being manager. He's like, I'd rather just like train clients, train myself, go home. And I was like, well, so you still want to work here? He's like, yeah, no, I love it here. I was like, okay. I was like, so you just want to go back to your old job? And he was like, yeah. I was like. So I was like, you're going to make half as much money? And he was like, yeah, I'll. I'll just. I'll just be poor then. And he said, yeah, I guess I'll just be poor. So I was like, you're gonna make half as much money. He said, I'll just be poor then. And I remember him saying that. And it was like my world, like, twirled around me. I was like, I don't understand this at all. But he said it with so much conviction. I was like, I don't understand it, but I respect it. And the lesson that I took away from that was, not everyone's motivated by the same things as me and to the same degree. It means that they're motivated by other things. And I have to learn what those other things are so that I can build career paths and roles and incentives that are right for them. And so that was the whole concept of the platinum rule rather than golden rule. Instead of, like, treat others the way you want to be treated, it was treat others the way they want to be treated. And that was my big takeaway that I've tried to stick with myself to this day, that I still mess up all the time. But it was just like, it was such a crazy lesson, I figured I'd share it. So. 26 on people. Can you be friends with your employees? This is a. A controversial one. Employees, question mark. Friends, question mark. I'll tell you the difference. So when I started, I was friends with all my employees. Whatever the professional line was, I definitely didn't have it. And so I was just friends because I was 20 something, right? And all the people who worked for me were 20 something. Like, we're all just like a bunch of. Bunch of hooligans, right? Like, trying to run a business, basically. I didn't run that well, right? Like, I would show my emotions on my sleeves. If I was upset, they would be upset. I'd take my emotions out on them. And, like, when I needed them to change something, it was weird because we're friends. I'm like, hey, man, can you, you know, like, it. It sucked. So I then kind of created the rule like, you can't be friends with your employees, right? And so I kind of lived that way for a while, and that maintained a professional line. And I would say that where I'm at now, in my career is that you can be friends with your employees as long as you maintain a clear line, which is that you, they have to respect. And the easiest way that I have delineated this is literally doing a hat change. Sounds silly, but it doesn't have to be an actual hat. But I, I'll start a conversation, be like friend hat. And then I'll talk, whatever I'm gonna talk. And sometimes like, hey man, boss hat. Like this is, this is what's going wrong. Like you need to change this, right? And by being able to maintain that. And I don't know if that's a maturity thing or whatever's happened first was like friends with everyone that didn't work, friends with no one. You can do that. But I would say like life is lonely. And then the, you know, the third version, at least where I'm at now, is that these are the people that help me accomplish my goals. I mean, I can't imagine a better definition of a friend. People who like, try to help you accomplish what you're, what you're trying to do. And so the people that work@acquisite.com I'm friends with many of them. But we also have a line of kind of like mutual respect and professionalism. Because at the end of the day, this is the kind of, you know, we're business athletes and we're all on a team and so everyone needs to perform. And so it's kind of having more like a coach relationship, I think where it's like a coach is still, I would say friends with the players, but there's just some line that you don't cross. And I think that that's, that's really what it comes down to. Like, I'm there for them 100%. I'm probably not going to like come in in tears because my dog dies. To somebody who's on my team, I don't think that'd be appropriate. Right. So it's just maintaining that line. So These are the 26 lessons I learned from building my gyms. And if you want to see me apply these lessons to a real everyday business that's not at all in this space, check out over here where I help a stranger build a million dollar business. Enjoy.