DON'T START A Business Until You WATCH THIS

If you've ever wanted to start your own business and you actually wanted to succeed, pay attention.

Look, here's the deal. Being an entrepreneur, especially on the early days, can be a little scary, a little intimidating even. It wasn't always that I was able to invest in businesses and try to kick start stuff and try to build stuff. What I did, however, learn is how to start a business with literally nothing. As many of you know my story, I started with literally stuff out of a trash pile to begin to build my own first construction company. That then led me into real estate, which then led me into books and speaking and other things. I learned a lot along the way. I made a lot of mistakes, a lot of mistakes that almost took me out over and over again, no matter which of the businesses I was investing in or getting started or working on. So much so that I think I've identified specific areas that you've got to pay attention to if you want your business to succeed. So let's jump into those now, number one.

Is trying to market a specific passion. So many times I see technicians go into business thinking they can become the entrepreneur, become the boss, even though what they're really gifted at is just doing the work. So, for example, using the construction, because that's an area that I come from. A plumber who's working for a plumbing company decides he wants to start his own business. Nothing wrong with that necessarily. Obviously, go to the current business owner and say, hey, look, I'm gonna go to a different market or whatever, and I'm gonna start my own company or whatever, right? Don't hide it, don't not have integrity or character. But in essence, the person's really good about installing toilets and putting pipes together and making sure the, you know, the cold water's on the right and the hot water's on the left and everything's flowing downhill, so to speak. But when it comes to basically running a business and owning a business, they don't have any experience whatsoever with hr, with accounting, with bidding, with, with knowing what it takes to actually put a truck together with all the equipment, all the tools that they need. There are specific things you need to know as you begin to look at something that you're passionate about in the market for it. What I mean by find a marketable passion is this is something that you would do for free if you absolutely had to, and there was no way out. The reason I say that is, is because far too many people take something they know how to do and assume the marketplace needs it. And in Some cases, like the plumber example, maybe, maybe the market does need it. In other cases, maybe the market already has 35 plumbers, right? If you have 35 plumbers, you have 35 competitors, which means you're going to be looking at reducing your margins and your money to get started, rather than maybe that same person is really good at carving custom tables. At a live edge where a table might cost $4,000 but only cost $600 in product, which one has a greater likelihood of succeeding. The trick is to make sure your idea, your concept, your product that you've done the work to understand what the marketplace needs. Is your idea, product or service. Is it something that actually creates an actual solution? Or is it just something that you're hoping to make money on? Because I promise you, if the sole goal is to make money, it's not going to go anywhere. In fact, most businesses that do fail, the owner is going after it simply for revenue. I recommend building a company, a service, a product or something of that nature around service. How can you make the largest impact with your product or, and, or service and stuff like that? If that product, service or technical genius, if you will, comes from a place of passion. When economies go up and down, which they will, you will be passionate enough to kind of keep going. Alright, so make sure before you start a company, this is something you absolutely love.

When I started the Journey Principles Institute, I did so with my own investment. I didn't start the entity or the business to make money. I started the business to change lives. So I have zero problem investing in my own thing for a while to watch lives change. I would do it for free because I love doing it and because my experience has taken me to a place where I feel like I can add value by showing other people how to follow in my footsteps. And the things that I've been through that changed and transformed my life, the same things that someone else had been through that they taught to me in a roundabout way. I'm creating a legacy driven lifestyle because I'm letting what's been trained into me now be trained into other people. You see what I'm saying? That's what I mean by a marketable passion. All right.

This is a big one because I see a lot of people jumping ship really fast. One of the number one questions I get from business owners or aspiring entrepreneurs is how do I go from making doing my job into a full time thing? In fact, I was asked that question recently on a Q and A that you can find here on YouTube. In that question, here's what I would say if you were totally passionate about that thing, right? But you haven't actually created enough revenue to offset or substantially increase your current level of pay. You gotta pause, you gotta play smart. And here's what I mean. You never dump a bunch of money, especially if you borrow it from a bank. Now, I'm against that. Me personally. Other people will counsel you differently. Right? You never borrow money from a bank or dump a bunch of capital into a risky venture without doing something called testing.

Test it at a community level or at a local level. Test it at the smallest level you possibly can. Try to look at it, launch it from there. So you don't have to launch. You don't have to have a perfect launch to test something, test it, uncover does the market need it? Can I make money doing it? And do I really, really love it? Is this something I would seriously do for free if I could? Okay, once you test it and you're, your level is rising. Now you can actually do some resource investing and say, okay, let's go to the next level. What you don't want to do is you don't want to be in an operating job that's providing for your family, have the shiny idea, even if it's something you like and love, and then totally jump ship, praying that it'll work. The reason you don't want to do that is because there's a 50% chance it's not going to work right out of the gate. Because being an entrepreneur is not easy. It's not the planes, it's not the cars, it's not all the shiny stuff. Being a real entrepreneur is sacrifice. It's making payroll, it's putting in the hours, it's having time away from your family and having them know the balance and the cost that's associated with that. Real entrepreneurs always sense real entrepreneurs because a real entrepreneur is a not only a get it done kind of person, but they're a never give up kind of person. That's an entrepreneur. And if you've got to give up bone in your body, you need to pause. You need to wait until such time as that testing has drawn encouragement for you to then invest a little bit more. And you don't need to go from investing 10% into investing 90 more percent. That's foolish. You need to go 10%, 15%, 20%, 25%, 30%, 35%. Okay, my revenue is going up, My revenue's going up. But does the revenue, after I pay all of my expenses.

Does that revenue offset the money I need to walk away from my full time job. In fact, here's what I would recommend. I would recommend not only that you build up this nest egg, if you will, I would recommend that once you are making that kind of money that you wait a minimum of another six months to a year before you decide to go.

And the reason I'm going to do that is because economy's change. I've watched great people with great ideas, with a passion driven market, Everything is right about it. But they just happen to take the step at the wrong moment. They happen to start a live events company right the day before COVID is announced.

You can't control the market, you can't control the economy. But by doing a stair step approach, what you are able to do is you are able to set the tone and set the pace. What which allows you to work through things and kind of continue going to make sure that you're not putting yourself at too much risk. One of the biggest struggles that entrepreneurs have historically are they're very, very opportunity oriented, which means by nature they're very not risk oriented. And if you're going to be successful as an entrepreneur, then what you're going to have to face more than anything else is the balance between opportunity and risk. All because it sounds good in your head and you can see the project finished and you can see all the wonderful things it'll do and all the wonderful things it'll do. You still have to count the cost.

The cost to build it, the cost of people. I can promise you business gets difficult the moment you hire the first team member. The moment you hire the first team member, business gets wonky. Why? Because we're people. We can't categorize our life and our business differently. We bring our whole selves to the business. And maybe you're a great leader already, maybe you've got a developer leader, but people are going to test you in a way that you not that you may not fully realize to help you develop as a leader. And some of those lessons are painful, which is why the passion has to be there, which is why you have to test to invest, which then goes to the next place, which I've been kind of talking about a little bit, which is start small and scale big.

Once you've tested to the point where you've replaced your income, once you've gotten your leadership to the point where people want to follow you because they trust you and you inspire them, not because you sign their paychecks. And if you're an entrepreneur Right now, who's hired people. And your whole point of reference is, well, I sign their paychecks. Dude, you're not doing it right. I got news for you. I've done it that way before. Almost cost myself dearly.

People matter, and you got to learn how to lead them. That's why you start small and scale big. You hire that first team member, they're going to teach you something about yourself. Maybe you hire Will to get going. Maybe you kind of have like a little partner or in some cases, like Connor, for example, who's with our team, who you guys have seen here on YouTube, right? Maybe you have a Connor who's brilliant, he's passionate, he's driven, and he's ready to move and go. Maybe you hire a dud. And I've done both.

I've hired people who could talk a good game. I've hired people because they could fog up a mirror. I've hired people because they sold me on how good they thought they were and their resume was stacked to the brim. What I've learned is to hire people with passion. People who believe what I believe. People who want to commit to helping people like I want to commit to helping people. People who want to build an organization and an opportunity and a career and not just a job, a job.

Because people who are only your organization as a job will eventually leave your organization because somebody's going to pay them a dollar more. Even though you're still in startup phase, it happens all the time. You can't worry about that stuff. You've got to consistently be developing yourself. When you start small and you're faithful with that and you learn to be a good steward of that, both from a human capital perspective and a financial capital perspective, then you're able to strengthen your overall resolve and the overall opportunity that your thing is going to be massively successful because you're being smart, you're not rushing. One of the other biggest mistakes that I see entrepreneurs make all the time, especially brand new ones, is they go from small and they go whoop. And they make a bunch of money and they're like, holy crap, I'm here. I made it. I'm an entrepreneur. Car, house stuff, basketball tickets, hockey tickets, wine and dining, drinking the fine wine, investing in other things before they're ready. And then a Covid happens or a dot com bubble happens. And all of a sudden everything that they've centered their identity around of becoming the successful entrepreneur, everything they centered around that they lose everything. And you find them where I was once Was which is staring over an overpass wondering if it all makes sense. Entrepreneurs understand opportunity. Entrepreneurs need to learn how to balance risk. Entrepreneurs need to start small and scale big because it reduces risk and increases potential. Right. How is profit made? Reducing expenses and increasing margin.

How are you going to know how to do that when you don't actually know your cost because you didn't take the time to test and invest and then start small, then scale big. When I say scale big, the scaling part happens over 10 years. It might be 10 or 20 years that you're scaling something because your thing is going to take more resources than you know what to think about it.

I have quite a bit of income tied up in retained earnings. It'll be a long time before I ever get my retained earnings out of one of my businesses. And the reason that is is because I have a huge team. I've got a lot of responsibility. I've got a lot of people's lives that I have to take care of.

And if I rush to it and I just go buy all the things that I want to buy and invest in all the things that I want to invest in without using ratios and some other things, then inevitably what happens is I bankrupt my own self because I got sloppy and I hurt a lot of people in the process. And if you're going to be an entrepreneur and you're going to have teams and team members, you need to understand very early on and not make the same mistake that I do, that you have a responsibility to provide opportunities for the people that work with you and for you.

That, at the end of the day, is what an entrepreneur looks like. An entrepreneur bears the risk, they bear the responsibility, they bear the accountability, and they wear the mantle of inspired trust. Are you, as an entrepreneur, willing to wear that mantle? I can tell you this. It is a very heavy mantle. The first time you have to go to layoff or fire your first person, it's going to mess with you. It'll mess with you so much that I can tell you that are people right now working for other people. And the only reason they're working there is because the entrepreneur themselves is scared of making the decision, not because the team member doesn't deserve it. And as a result, those businesses are starting to slide backwards.

How are you going to develop the need and the wisdom to make the call?

There's so much in this. There's so much that comes from experience and knowledge and wisdom.

When I'm looking for business advice, I go to people who are more successful than I am. And who have been in business longer than I have, because they see more things than I have seen.

That's why we were able to be somewhat protective in some of the different areas that we had this year that in the providence of God himself. See, I understand. I don't own my organizations. My businesses, if you will, are ministry fields. I don't know how else to explain the homeless kid that becomes a business owner with hundreds of team members outside of divine intervention. Now, you may say, well, you worked your butt off and you did all this stuff, right? And you. No, no, no, no, no, no, no. I've survived most of my mistakes. That's why I've been successful, because I've got a God who actually loves me that actually helped me with that. Now, that's my personal opinion, but I don't know how to say it any other way. I've survived crashes and downturns, and now I've been blessed and honored to even survive this thing that they call Covid without having to fire 70% of my team or. You see what I'm saying? But I was able, because of experience, because of testing and investing and starting small and trying to scale big, I was able to put ourselves in a position and that allowed us to actually treat the team how we want to be treated. So start small, scale big, do it in time. Okay, next, ratios.

Ratios build resilience. Now, you've heard me. If you've been watching this channel for any length of time and you've seen some of the other videos that I've done, you know, I talk about from a life perspective, this importance of having financial ratios that both protect you and. And allow you to invest for the future. Okay? And the ratio is kind of like a sliding scale. As you increase your income and as you decrease your debt, you're able to set aside more of a ratio and to live off of less and invest more. Okay? The same holds exactly true in business. I see entrepreneurs all the time, well meaning great people who actually take care of their teams and actually sincerely want to build something special that they get in the business one or two years. And while they're still in the business one or two years old, they're thinking about doing another thing, starting another business, creating another endeavor.

That'S a distraction.

In order for you to scale to something else, you have to scale the thing you have already. Once you scale the thing you have already and your ratios are within check, where about 20% of your 20% or 10 to 25% of your time is Spent running the, the original thing. Now you have some flexibility, if you will right, to go do some other things. For example, my large construction company, okay, I'm still involved, but only about 20 to 25% of my time is directly focused on that business administration.

However, it's taking almost three years to retrain a brand new leadership team that I feel like large in part that I can trust to do a good job to carry my values and their talents to the marketplace. You can't get there in one year or two years. What you're doing is you're separating the capital that you need to put back into your original baby and as a result, you're going to open yourselves up for chances for failure, catastrophic. So because you can't predict the marketplace, does that make sense? You've got to understand these principles of ratios. You can't put yourself at risk again. One of the biggest mistakes entrepreneurs make all the time is they jump in with both feet. They're not really prepared, they don't really have the capital, they haven't done the savings, they haven't learned to lead, they haven't learned to learn, they haven't learned to make. The biggest mistake I personally made, which is building a business without building myself.

These are very painful lessons that I don't want you to have to make. I want you to understand what you're capable of, but from a perspective of what is possible rather than what you're going to bump your head along the way. I don't want you to have to go. I have good friends with good people who had to go bankrupt a couple of times for them to really figure out the rhythm. I don't want that for you. The reason I can tell you these things here is because of the business mentorship that I've had along the way. I'm not anything special. I don't have a massive entrepreneur tooth in my mouth that has me like some kind of massive, like magical circumstance around me. I just decided I was going to learn from people who have been there, who have stood the test of time and who could understand how to help me scale to a reasonable level. Does that make sense? Again, market driven passion test to invest, start small, then scale big, slowly over time, use ratios for resilience to make sure your capital and all your funding and all your investments and all that stuff is not distracted or liquidated. You know, don't go out and get a bunch of credit cards. Don't go out and buy a new building. Don't want, don't go do Things that the ratios don't support.

Right? If you got 20, 25%, you're going to need another 20 or 25% in retained earnings that built, that are building up over time, right? You're going to have to buy stuff, you're going to have to buy equipment from time to time. Are you, are you buying used equipment? Are you buying brand new equipment? You see what I'm saying? You've got to think through these things, okay? And this one I'm going to steal from my good friend Rory Vaden, who's become a good friend of mine and a good mentor in a lot of respects. He's actually been helping us a ton with the overall brand side of things to help me cut through the noise and help me help more people. And this is something that he says that I think can be applied to anything in life and, or business. And this is what it says. Build as fast as you can, but as slow as you need to.

Build as fast as you can and as slow as you need to.

There's wisdom there, a lot of it don't get lost in. We got a scale, we're going to have multiple states. I'm going to be able to buy personal. Dude, if you get there, fan freaking tastic. Congratulations. You are not going to get there overnight. I don't care what you see on Instagram, I don't care what you see on Facebook or YouTube or whatever. There's no such thing as an overnight success. Even music, artists and movie stars, all this kind of stuff that come out of, quote, unquote, nowhere have typically been at that craft for three to five to even 10 years before they're even given a sniff to take it to the next level. Entrepreneurship is the same way. And if you are wanting to be an entrepreneur, you're wanting to scale your business as an entrepreneur, you've got to put these things into practice. If you don't put these into practice, you are opening yourselves up for catastrophic failure and big, big risk.

Now, I hope you can see the actual wisdom that Rory taught. Build as fast as you can, as slow as you need to. Because if you don't get to all of this correctly.

And in the right way, in a resilient way, then you are opening yourself up to catastrophic failure. However. However, there is a. However, the most successful entrepreneurs on the planet have up to seven major income streams, okay? So if one takes a dump, one's there to catch the fall. But you can only do that after you do this once. Well, which teaches you how to do it again, which teach you how to do it again. Okay? And that's when you actually get to step into this place right here, which is you get to add income streams. But if you don't do these things well, this is not even attainable. This should not even be a goal of yours till five or ten years out.

You have to have an organization that's operating like a machine. Like a machine. You have to have enough retained earnings and enough liquidity. That is capital, that is cash. If you the bank to cover three to nine months of operating expenditures in case there's a problem.

And if you don't have that in place and you're looking at doing the next shiny thing, you are fooling yourself and you're opening yourself up for a big, big problem. So you can't do that. The final thing I want to share with you is kind of like a bonus thing. Is this the biggest mistake I ever made in building a business? The biggest one by far is not building myself. And I don't want you to make that mistake. Which is why you check out this video right here. I'll see you in the next one.