The Harsh Truth About Scaling a $10m Business

Hello ladies and gentlemen, James Blackwell here. And in today's video, I'm going to be sharing the hard truth about what it takes to really scale your business. And a lot of people probably don't tell you some of these things because look, really scaling a business is very, very hard and it's tough. It's not for everyone. And I talk about this before, like entrepreneurship is not as easy as people think, but it can be simple if you follow the right steps. And my process. Okay, so like one of the key lessons that I've learned is, is I've skilled multiple companies now. So I started off in my entrepreneurial journey starting with my recruitment agency that I scaled from a 10,000 pound credit card all the way up to doing 2 million a year with a team of 10 that pretty much self manages now. So that's been running for 10 years consistently. Then I started an education company that does just close to eight figures a year and that's helped over 1,000 agency owners scale their business to six and seven figures. And then we off the back of that we've spun off two recruitment agencies that provide like systems integrator service for VAs and then marketing people in South Africa that we train and place into agencies to help them scale faster. Then off the back of that, obviously a SaaS company. So long story short, it's very hard to scale a business. But I feel that there's a lot of advice out there, especially on YouTube that you could learn from. But I really think you need to walk the path. So a lot of people get stuck. Round about the 10k per month mark is probably the most common. 10 to 20k a month is like pretty much where 95% of entrepreneurs get stuck. They struggle to get past a million a year. And that's from a number of factors. One of the key things is keeping things simple is very, very important. So one thing I've found after scaling my businesses and getting to the eight figure mark is, well, there's so much complexity when you have a big team and not just a big team, lots of systems, lots of clients, lots of delivery, lots of fulfillment, things get crossed over and complex. Okay, so trying to keep the business simple as possible, even from the start, is very, very important because as you scale it's even harder to keep the business simple. And the second thing is going to be building a culture with a team. So when you're at 10k a month, you're pretty much a solopreneur. So that means that you don't really have a Real company or business as it were, like in terms of the money generates without you making most of the actions in the company. So you want to get from a position where, yes, you hustle hard to get to your first 10, 20k months, but once you try and get to 50, that's when you start building a team. And most people really fall at this because we're in this like gig economy where everyone's a freelancer, everyone's an entrepreneur. So it's very hard to hire good people. And you end up hiring probably C players at first, at best, maybe a couple of B players. You're very, very, very rarely going to attract an A player straight away. So then it's trying to manage them in effect and still maintain your business profitability. Because a lot of the time when you hire that second and third employee, you're going to have to carry them a lot of time. So you're still going to have to generate the revenue and, and probably sacrifice some of your profit for the team at the start. And that's where people go back to the solopreneurship where they're like, well, screw that. I'd rather make 10, 15, 20k per month and keep 80% of the profits myself. And that's okay for some of you, I think even like at that stage, like being an entrepreneur and having that business, good cash flow business, good life, there's nothing wrong with that. And then for the what like the, I would say the 1 to 5% of entrepreneurs that really want to take things to the next level in seven, eight figures and maybe nine figures in your company, you really need to crack the code of hiring a good team. So I've been in business for over 1112 years now, hired, hired and fired a lot of employees. I've hired and fired probably over 40 employees that I've had to let go over that time. And it's true, like you want to hire slow fire, fast, but the only way you're going to learn from that is from your mistakes. So it's very easy to say that. But I think until you go through that, actually hire, interview and on board, and then you actually see the problems some employees start to make for you. You have to go through that journey, I feel like yourself, but if you recognize it fast, then you can go through that. So that will be the second thing is obviously building a team culture and having a good team to deliver. That's going to be the crucial part from getting you from like 50k to 100k per month and implementing Systems is very, very important. So when we talk about systems, what are systems? So it's a mixture between like SOPs, the standardized process for each department, mixed with making sure one, that employee does that work and trying your best to have automation, AI and tools that help leverage that a little bit more so you get more efficiency out of your employees. And then obviously you're refining these systems when you get more problems. So maybe clients are experiencing certain problems and fulfillment, then you go in and fix up and then you systemize and standardize that process, make sure it doesn't happen again. And that's the same on the front end with client fulfillment. And one of the other mistakes that I see a lot of entrepreneurs make is every entrepreneur has the passion for their business, okay? But the employees are never going to be as passionate as you. So obviously you need to get them on side in terms of like maybe profit share, making sure you pay them really, really well if they're really, really good, but also not delegating your front end sales too fast because you're going to give away a lot of your profits to a sales team and they're never going to really be able to sell as good as you. Now I'm not talking about that in like the education online course side because obviously I started that in year five or six of my journey of building my agency. Then I went into online education as well and I did about a thousand sales goals myself. And funny enough, I actually did three or four sales calls last month for the first time in three years. And that made me realize that there was a few mistakes that my sales team were making in terms of expectations with potential leads and clients coming into our community and programs. And it was refreshing to see like you still need to be on the pulse with the business. So I'd actually manage myself out of all my companies to create this self managing lifestyle and travel around the world. And I'm very blessed with that. But also I feel like it's very important to have that relevancy and intimacy, as it were, with your clients. So still trying to stay close with the team and the end result that you deliver with your service is very important because that's when you get competition that comes in with another younger, hungry entrepreneur that tries to take a slice of your pieces. So it's all about also building a moat around your business. And a moat is something where you've got assets that competition can't come in and create quite quickly. You've got a great strong team, you've got a strong brand, you've got strong organic traffic coming in. All of these things are a big factor of building a strong motor around your business so you can survive through tough times and really thrive through the good times as well. And then making sure that you have high profits. So one of the things that I've done in my businesses and journey has always been it's always profit first. And there's actually a book called Profit first as well. And the business should be there to serve you, not you serve the business. At the start, look, it's tough. You should be 60, 70 hours a week in your business to make it like a potential success. But once you get the wheels in motion and the flywheel starting and things are starting to tick, it's very important to make sure that you're looking at your profit. I always remember that conversation I had with a mentor called James Kahn who was on Dragon's Den. He wanted to invest in my recruitment company when I was first starting this up, I think 10, 11 years ago. And he gave me the advice of like cash is king, like watch the cash flow. And it is very, very true. Like I check all my bank accounts every single week, if not daily. I have a P and L report daily on all my businesses and I look at that and different departments and I can see where there is things that need my energy and focus. So that when you get in a luxury position of actually being a CEO in your company, you can start to look at things from an holistic point of view and see what areas that need improving. So like making sure you don't get tied on the revenue mark. A lot of people in different industries are all obsessed with this like 100k months or 500k months or a million dollar months. But what are you actually taking home? Because that is the most important number, especially if you've got a high cash flow business, if you've got a SaaS company or you're building a company to exit, that's a different stage. So it might not all be about profitability at that time, but if you've started as a solopreneur and you start a high cash flow business, whether it's like a B2B service business, online education company, these type of things, it's all about profit. Like how much money do you retain every single month and every single year and is it growing? So like I make sure that I'm, I'm comparing my numbers from this time last year to the year before and it needs to have an incremental increase because yeah, if you're not growing, you're dying. And it's very important that we keep growing and we're on a good trajectory and we've got the right type of offers into the market. So that's very important. And then having the freedom to think clearly like I always have. I'm blessed with having apartment views with like full sea views and looking out into an abundance mentality. So that gives me a good frame of mind and mindset every single day to be more motivated to inspire others and make more money for my businesses, my employees and for my end user clients. So that's very important as well. Like obviously I covered off maybe a few times I will on another video about the habits that it takes to be a multimillionaire. But yeah, these are like some of the things that I just thought I'd freestyle and share with you on this journey. I'm trying to do some more just off the cuff, raw, uncut videos about this. So just interested to see where you are in your journey in entrepreneurship and what the key things that you found and learnings that you found, whether it's scaling from 0 to 10k months to 10 to 50, to 100 to 500 to a million a month or whatever it is that you're doing and what the learnings have been. And one of the reflections that I've had very recently has been coming back to Dubai again was I went through that stage of like having like the fancy watches, having the supercars, all these things that I've got have accumulated and I feel that weight of heaviness on my shoulders of just acquiring more materialism things doesn't really fulfill your true purpose. So it's like realigning that back and I do think that you need to go for it. So if you've got to go, because I would never have got to where I've got to if I didn't have the motivation to have the Rolls rise, the Ferrari, the nice houses, look after my family, take my family on nice holidays, set my future family up for long term security. All of those motivations were very important. But once you achieve a lot of these things, they don't mean too much. And I'm very, I'm already sensing I'm big on reality, transurfing as you know, and energy hoarding things that you're not using. So for example, whether it's luxury items and these type of things that, that could come back on you. So I'm very, yeah, I'm very mindful now this, this, this season for me is to have less in terms of just buy less materialistic things that I feel that I want, don't necessarily need. Still have some nice things, but make sure that I'm enjoying them and they're making me feel good. And I'm not trying to hoard too much from that because that definitely is a mirror reflection back into the universe and energy. So, yeah, that was just another reflection that I had. But it's very important to go through that. It's very easy for me to say you don't need to buy the Ferrari or Rolls Royce or whatever it is you dream to have because it won't fulfill you or you'd be bored of it after six months. I still think you need to go through that. It's very important. So I'm not going to be one to say just skip through it. I think you have to go through each step of the journey and I've been speaking to a lot of entrepreneurs recently that actually want to move out to Dubai. So, yeah, I'll be keen to see who else is moving on to Dubai again. Comment below if there's any other entrepreneurs that I know that are in the area. I've managed to build a really fortunate and great friendship group here in Dubai and I probably wouldn't have been as successful over the last, probably three to four years if I didn't make this move out of my. My home city back in Newcastle. So. So, yeah, give me a comment below, let me know where you're at and I'll catch you soon.