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00:00:00Hello, friends. I'm bringing a brand new live show across the UK and Ireland this October.
00:00:05It's stories, psychology, audience Q&As, and whatever happens when thousands of overthinkers
00:00:09voluntarily leave the house and end up in the same room together. I'd love to see you there.
00:00:12The last tour completely sold out, so make sure that you snag tickets now using the link in the
00:00:17description or heading to chriswilliamson.live. Dublin's already sold out. Loads of venues are
00:00:22limited. Tickets are very limited, so get yours now. chriswilliamson.live.
00:00:26What's the biggest lie that people are told about getting rich?
00:00:30That is actually about looking rich and not getting rich. I think especially for men these
00:00:35days, like, it's all in your face. On social media today, you can see just about everywhere what
00:00:40somebody's success level is, except if you were to pull up the balance sheet, it would be something
00:00:44very different. And so I think rich actually is two things. One, yes, do you have enough money,
00:00:51you know, divided by 0.4 to have the life that you want? And then two, it's do you actually like
00:00:58the life you want? I love Naval's quote, which is, you know, basically the definition of success
00:01:03is, do you have what you want out of life? The definition of happiness being the same.
00:01:08And I think we all kind of trauma bonded as business owners over the fact we should be
00:01:12miserable when we run our businesses. You don't look miserable. It's hard, but I don't think being
00:01:17rich or being an owner has to be miserable. And that's a great lie.
00:01:20I wonder how many people love the idea of working for themselves until they realize that
00:01:24they end up being trapped by their own business.
00:01:26Oh, well, I mean, interestingly enough, 46% of business owners actually aren't profitable. So most
00:01:34business owners aren't profitable ever. 64% of business owners are profitable, but they make
00:01:40less than minimum wage in California, which is actually wild. So if you think about it that
00:01:44the average business owner makes somewhere between 40 and 60 K per year, I think minimum wage,
00:01:49if you were to work full time in California shakes out to about 75, $78,000 a year. So yeah, I think
00:01:56you don't need to take your job home with you. You're not stressing over whether or not you can
00:01:59make ends meet inside of the business. You're not paying yourself in order to front load the staff's
00:02:05wages for next month. Yeah. And, you know, and I get a lot of crap for talking about wanting to buy
00:02:10businesses instead, but it's mostly because it's really fucking hard to start one and most of them
00:02:15fail. And sadly, the ones that do win, that means you paid for the right to one day of
00:02:19eventually make some money for three to four years. And people don't think about that.
00:02:24And so if you've, if you actually have a business that makes money right now,
00:02:28you're in the top 10%. You know, if you have a business that makes a million dollars a year,
00:02:31you're well above the top 1%, even though you're probably only taking home on 150 K a year.
00:02:36And if you have a business that's a $10 million a year business, that's 0.01% of all businesses.
00:02:42So it's way harder than anybody thinks. Does that mean that very few people should start
00:02:48businesses or become business people? I think it means you got to know what you're
00:02:52getting into. You know, I think anybody who's trying to sell you that you can have everything
00:02:57you want inside of 30, 60, or 90 days, and you can do it with little or no money down,
00:03:02and you can do it with no effort, it's not going to work out. The only time it works out is when
00:03:06you look at the math in most of these things. And I'm just a nerd. Like I look at the spreadsheets
00:03:10of buying a business and I say, what's the lowest default rate you could have? That's an SBA loan.
00:03:1513% of those businesses fail per year. That's just public math. Then I look at startups, 90% of them
00:03:21fail within a five to 10 year period. So you basically have these like crazy two amounts of
00:03:26success rates. I think probably most people should go work in somebody else's business that's really
00:03:33successful first before you ever think about starting your own. You'd be much better off.
00:03:38It's interesting. The question, could anybody become a business owner? It's probably quite high
00:03:42with enough childhood trauma and caffeine and sleep deprivation and obsession. Probably anybody
00:03:49could. That doesn't mean that anybody should. And I saw this a lot when I was coming up doing nightlife
00:03:55stuff. Lots of people had the ability, but not the capacity or the disposition maybe would be a
00:04:04better way to say it. Like you have all of the component parts of the talent, but what it does
00:04:09to you, what it requires from you in terms of a sacrifice, especially in the beginning, because for
00:04:15the most part, it's hardest in the beginning and the challenges get more complex and more difficult in
00:04:19some ways. But as you say, momentum is a hell of a drug and the habit of I'm a business person and I
00:04:27understand what time I get up and I understand how to switch off if I can. And so on and so forth.
00:04:30Those are skills that take a long time. And the like Dunning-Kruger messy middle bit is where it
00:04:36really hurts.
00:04:36Yeah. And most businesses fail, not just because of cash, but because the founder gives up. I mean,
00:04:41that's why venture capital loves two founders, sometimes even three, because the likelihood of
00:04:46you burning out in your business is actually higher than an employee burning out of their business.
00:04:50Most entrepreneurs just don't make it. But I mean, my flip side there is like, you can own part of
00:04:56a business for almost anybody pretty quickly. I think people overestimate how hard that is. Like,
00:05:03you must get thousands of applicants, right, for your business. And how often you're like, God,
00:05:08where are the competent people? Where are they? Aren't you thinking that a lot? Like, they don't
00:05:12work hard as much. This generation's not as tough. Every business owner I've ever met thinks that.
00:05:17So I think you can actually go inside somebody else's business, carve out a piece of equity
00:05:21in that business, if you're super valuable, and then you're still a business owner. Like,
00:05:25we don't look at Sheryl Sandberg differently for that. We don't look at Balaji Srinivasan
00:05:30different because he was CTO. Guy's still worth hundreds of millions of dollars. So I think it's
00:05:34actually totally feasible, but people just don't think about it that way.
00:05:37What's that story about when you turned down Richard Branson?
00:05:40Well, you know, early on in my career in business, I was a terrible operator and I had what I call the
00:05:49hero complex in business. Like, you have to survive. If you're not the savior in everything in your
00:05:54business, your business won't survive. And most entrepreneurs tell ourselves that because we're
00:05:58unemployable and we do have a little bit of a God complex and we have a little bit of trauma from
00:06:03whatever happened to us that put us into the masochism that is entrepreneurship. And so in my
00:06:09business, I was a huge Branson fan, and I still am, but it was because he got to live this crazy life
00:06:15while he built a business. Like, how many billionaires do you know go and, you know, travel on a hot
00:06:20air balloon across the world? I just thought that was really cool and I like adventuring. So, and then
00:06:24he invited me to his island. Now I don't go to Billionaires Islands, you know, that's our own side.
00:06:30You're a bad rap. I think you should bring them back.
00:06:32I don't know. So now I would probably say no, I guess. No, I would go. But I got invited and I
00:06:38couldn't. I told myself that I didn't have time. If I left the business, it would fail. And I saw
00:06:42this activity list of like water biking, water bicycling, whatever that is, hanging out without
00:06:47your phone for multiple days. And there was just no way I could get away from my business for that.
00:06:53And, you know, since then I have had a bunch of friends go, they've done business deals, they've met,
00:06:57you know, power players, they did all this stuff that is asymmetric to business,
00:07:01being in spreadsheets. And I missed out on it because I told myself a total lie about building
00:07:05businesses, which is that the business is centered around you, and you are the most important part.
00:07:11And if you don't drive revenue, the business won't make revenue. And now that's not true at all.
00:07:15You told yourself that didn't go and see Branson. Meanwhile, Branson snorkeling and running billion
00:07:21dollar businesses. Yeah, multiple. And I think at the time this business was probably doing five
00:07:26million dollars a year. You know, it was not a big business at all. And it was growing and it was
00:07:30profitable. You know, there was no fire to put out. It was just a lie I told myself.
00:07:34How much responsibility is really just ego? Do you think?
00:07:40That's an interesting question. I think, I think when it comes to business building,
00:07:48we try to wrap up our identity so much in the thing that we call ourselves CEO, founder, creator. And we
00:07:55don't realize that one day your business will have a giant gaping hole of failure in it. And you'll
00:08:01sit alone in the dark with no idea of what to do next, wondering why you ever started this thing and
00:08:07really worried that it's going to fail and it's going to fail because of you. We will all have that
00:08:10moment. And when that moment happens, if it's your entire identity, then what do you do? Then you're a
00:08:16failure because you couldn't figure out this one business issue. You know, Branson's had something like
00:08:2060 plus businesses over his career, multiple huge failures. And so how much of us wrapping our identity
00:08:28in one thing is the thing that's holding us back? Probably a lot. And is that actually healthy for
00:08:34you at all? And what if actually the people who work for you are more competent than you think,
00:08:39and they might be better than you at something? But it's taken me, I don't know, 15 years to figure that
00:08:44out. Take me through the story arc of the typical founder, business owner, person, who they are,
00:08:51how they start, how they frame it, what that morphs into the problems they face and sort of what the
00:08:56path out is on the other side. What's the story that we've got here? Yeah. Well, I would say there's
00:09:01really, there's 12 types of owners. And the three most common owners or founders or entrepreneurs
00:09:08are what we call the closer, the ball hog and the visionary. And we've run about 15,000 people through
00:09:14a survey to figure out what are the three most common and what are their strengths and weaknesses.
00:09:20And what's fascinating is the three most common all have a very similar story arc, which is I worked
00:09:26for somebody else. They wouldn't listen to me. I wanted to do it differently. They saw a different path
00:09:32for me. I didn't fit into the mold. And so I had to go create my own thing because I became relatively
00:09:36unemployable or I was faster, better, stronger than the other guys. And so I went and did my own thing.
00:09:44And the founders typically have three characteristics. If you're a closer,
00:09:49they're really good at selling anything, right? You could probably sell ice to an Eskimo. You're like
00:09:54selling promotions. Then you're on Love Island selling yourself. Then you're here talking to an entire
00:09:59generation, right? You probably are a closer. I'm not sure. That's like one of the most successful
00:10:04archetypes. We have lots of friends who are great salespeople. The second one is the founder, which
00:10:08is like you will something to existence like new tonic that just hasn't existed before. You create a
00:10:14product that nobody else has had. And the third is the visionary. And the visionary sells dreams.
00:10:20They have, you know, if you want to succeed as a CEO, you have to sell a vision that's bigger
00:10:24than what your employees could see by themselves. You need to be able to raise them up. Otherwise,
00:10:28they don't need you. And so I think the arc for almost everybody is you're highly qualified. You're
00:10:34good. You're in business. You're outperforming other people. They're not listening to you. You go
00:10:38execute. The problem is all of that is about you. None of that is about you as a leader, as a builder of
00:10:46a real business, putting in systems and processes. That is actually usually for number twos and number
00:10:51threes. So you've got to learn that skill. And I had to too. And you have to learn it a lot more when you're
00:10:57outside of an organization. You're creating your own.
00:11:00What are the component parts of those skills?
00:11:03Well, if I was going to break down what makes a good, like a great founder, what are the best
00:11:09founders have? One, they hate repeating themselves. Like how many times have you as a leader said,
00:11:16I swear to God, if I have to repeat this one more time, I'm going to lose it. That annoyance for
00:11:20repetition actually leads to systems. And systems are the only thing that allow you to scale. So you can
00:11:25be an incredible salesperson. If you're a salesperson of one, you'll only get to, I've seen some businesses get to a few million in sales with one salesperson, but that's it.
00:11:33So one, you hate repetition. Two is you love one thing about your business more than anybody else,
00:11:40which is selling the client on exactly, not the product, but the problem you're solving.
00:11:47And usually I take new tonic again. It would be like, yeah, I don't actually really know what's in the
00:11:52drink, but you're selling, hey, maybe I want to be like Chris Williamson. Maybe I want to like be super
00:11:57productive. Like I have this brain frog, right? You have to be obsessed with this problem set.
00:12:02And I think the problem with a lot of young entrepreneurs today is they're like, I'm starting an AI services
00:12:08business. You're like, why are you obsessed with that? Can you not sleep for the want of it? If not, you shouldn't start it.
00:12:13And then the third thing they have to do is they have to be able to have other people believe that
00:12:18they might actually be able to follow through on the dream. And I think a lot of entrepreneurs fall
00:12:22down there. They'll say there aren't A players anywhere. Well, how many times have you wanted
00:12:26to go work for a C player? If you're an A player, you got to be a winner if you want to attract winners.
00:12:30And that's really hard to look in the mirror and ask yourself.
00:12:34Do you think, is being indispensable a compliment to founders?
00:12:39No. I mean, if you could take one thing as a founder to heart, it would be your revenue should
00:12:45have nothing to do with you. Actually, the more that you are the driver of your revenue,
00:12:51the less you have a business, the more you have a highly paid job.
00:12:54And, you know, I think about it like a entrepreneur pyramid with three levels to the game.
00:12:59The bottom level of the pyramid, that's the wantrepreneurs. This is like,
00:13:04we all do it together, you know, but really I do everything. The next level is a manager,
00:13:10which is they do things, kind of, but I micromanage and oversee them. And at the very top,
00:13:16it should actually be as a CEO. I do very few things and the team does everything else.
00:13:23It's also called the generalist to specialist curve. Like you essentially move people from
00:13:27doing many things kind of well to having a few specialists that run everything really well.
00:13:32Yeah. You say that most of dangerous addiction for a founder is being needed.
00:13:35Hmm. I mean, it's true. I mean, I think in your business,
00:13:40there's nothing better than feeling like you can come in and save the day and make the money and do the
00:13:45close in your business. Especially, I mean, we have a lot of entrepreneurs and founders who are men.
00:13:52That's like 95% of the companies that we have. And I see it a lot with them. Women typically want to
00:13:58be needed by their employees. Men want to be needed for the business. And so if the business needs them
00:14:03to close and grow revenue, then they feel really excited about it. And the thing that got them the
00:14:09ability to be a founder ends up becoming the reason they'll never succeed. You know, we have one founder
00:14:13that I adore. And he's built a really big company. And the business is quite big now. It's a nine-figure
00:14:20business. And if that business fails, it will be one person's fault. And that is him. Because he will
00:14:26not get out of the way to hire people better than him. And I think a lot of times we get scared of
00:14:32hiring people better than us. Because what does that mean for us as a founder? Do we have guilt? Do we have
00:14:36shame? Could they take over our position? It's kind of not normal.
00:14:40I think that's it. I mean, you might be right that lots of founders have access to a talent
00:14:47pool which is better than them. I get the sense that finding people that are competent and hardworking
00:14:53and have initiative is an unbelievably rarefied skillset. And I would guess more founders struggle
00:15:02to find the candidates and the staff than find them and have some existential fear about bringing
00:15:10them into their organization. What do you think?
00:15:12I think the fear is subconscious. And so it's hard to know. I think the fear is subconscious,
00:15:18but the real problem is what Charlie Munger said, which is you or I are probably not good enough at
00:15:24setting up incentives properly. So the reason why you're scared of somebody in your business being
00:15:30better than you is often because you don't know how to corral them as a force inside of your business.
00:15:37Because if you are really good at incentives, you could hire just about anybody and point them
00:15:42in the right direction and get out of their way.
00:15:44Okay. How does a business owner get the most out of their staff?
00:15:48You nail the incentives. If you want to win, follow the incentives always. So first,
00:15:54like I really think there's only five reasons why anybody does anything in your business.
00:15:57They want to make money. One. Two, they want relevance. Three, they want to lead. They want a team and
00:16:04to not be a doer on top of it all the time. Four, they want not just relevance, but significance.
00:16:11Like I'm higher than this person. I have a higher hierarchy or title than this person does. And five,
00:16:18they want work-life balance or freedom. And so those are like the five main levers we use in our
00:16:22business if we want to incentivize somebody. The biggest mistake you can make early on as a founder
00:16:27is thinking that everybody's like you. I like money. So like if I'm incentivizing me,
00:16:32you can insert him off in his sweater. If it's me, you're going to give me a comp plan that just shows
00:16:39me I can make millions of dollars. I'm going to fucking run. If you show me a comp plan that gives
00:16:44me lots of work-life balance, Fridays off, foosball table, I don't give a shit. That's not interesting.
00:16:50But if you're in Austin, guess what's more important? The freedom than the money, actually,
00:16:55from the culture here, writ large. And so how you incentivize them, you got to know your people.
00:17:00So we make all of them take a personality score. This comes from private equity. It's not that I'm
00:17:04smart. I stole all of this. And private equity makes every single employee take personality tests
00:17:10and then drives their incentive comp plan to what they do. Like if you hire somebody who's balance and
00:17:15freedom-based, but they're a genius at creative insight or engineering or product, that's a win.
00:17:23But if you put them on a comp plan that's only about money, you're going to lose and so are they.
00:17:28And so it's a dance, and I wish it was the same every single time. It's not.
00:17:31What are the most overlooked from those five? Or what are the ones that people-
00:17:35Probably significance and relevance. If you think about titles, there's a lot of people today that
00:17:42will say, you shouldn't care about titles. You know, don't have title creep. I don't know that that's
00:17:48always true. If somebody wants to have a high title and that's really important to them, you could pay
00:17:52somebody way less money. You could give them less time off, but you could give them a higher title.
00:17:56Okay, that's just a lever. We all know of people in our industry that use the title game to compensate
00:18:02for the salary game. Oh, a lot. Most founders actually put founder or entrepreneur or visionary,
00:18:08that one makes me want to die, like next to their name. But their business makes, you know,
00:18:1330k a year. But that's important to them, that sort of significance. And then relevance is slightly
00:18:19different in that a lot of people, like my company, for instance, so we have 100+ employees at the
00:18:26media company and advisory business. And I would say like probably 15% of them really care about
00:18:33impact and relevance. Like they could have been in private equity, they were in private equity before,
00:18:38but they're like, God, I don't want to die, you know, on Wall Street doing deals. I want to feel
00:18:42like it meant something what I did. So you could pay that guy less. In fact, often we do. But they could
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00:19:48checkout. What I'm interested in most, I think, is this transition from founder mode to owner mode
00:19:55over time. And I've seen this three times now in my life. First running the nightclubs, then running
00:20:03Modern Wisdom, and now also running Newtonic as well. Less so with Newtonic. I've been good with that. But
00:20:10here's the problem that I think a lot of people face. Founder initially has to become sort of
00:20:14psychologically fused to the company. They are the company. They work harder than everyone. They know
00:20:19every customer. They take every just checking in call. And that intensity is what gets the company
00:20:24off the ground. That is the fuel. And then at some point, the rules reverse. And to become an owner,
00:20:32the founder has to dismantle that identity. They've got this identity. That's who they built themselves into.
00:20:38And they have to tolerate other people doing things differently. They've got to lose the
00:20:41dopamine of saving the day. They have to let other employees become more important or make mistakes,
00:20:47allow customers to form relationships with other people inside of their company that they don't
00:20:50anymore. And then accept that the ultimate evidence of their success is that things can go perfectly well
00:20:55without them, right? Like this is the arc. But the problem is basically entrepreneurship rewards like
00:21:04narcissistic levels of self-belief in the beginning. And then ownership punishes narcissistic levels of
00:21:10self-importance when you grow up. How does an owner know when they have stopped being the hero and started being the bottleneck?
00:21:21Because everyone, unless you buy the business, and I guess you can leapfrog and maybe basically get yourself
00:21:26out of a little bit of the founder mode because I wasn't there at the very, very beginning.
00:21:31Lots of people are going to found businesses. Many of them are going to fail. Some of them are going to succeed. For the ones that want to not fail,
00:21:37how do you coach people through relinquishing that control? They've wrapped their existential sense of
00:21:46well-being, their personality, their psychic morphic resonance with the world is all contorted around
00:21:51this thing, right? I'm the guy. I took every fucking call. This podcast, I did thousands and thousands and
00:21:57thousands of ad reads. I signed every single invoice. I made sure that every single guest was booked for
00:22:02800 episodes with no assistance, like scheduling, researching, booking things in, title, thumbnail,
00:22:06everything. And now I need to relinquish all of this stuff. How does a business owner know when
00:22:11to let go of being the hero because they've become the bottleneck?
00:22:13Yeah. Well, I mean, first, our line at our company, when we bring anybody on to advise them, is
00:22:20being the hero is taking heroin. So you have an addiction, it is to your business. And if you continue
00:22:26to be the hero, that's a four-letter word at your company, actually. I think you need to flip the
00:22:32entire script. This is super unpopular. But you know how people used to say you have to serve your
00:22:36employees? Well, actually, the best way to serve your employees is make sure you don't flame out
00:22:41miraculously and not be able to pay them and fail. And so your employees actually have to serve you
00:22:46in some ways. And they need to get on the board with that. So that would be first, realize that being
00:22:51the hero is actually heroine. The second is, I don't like to talk about it as founder versus owner mode.
00:22:55I say, are you self-employed versus an owner? Self-employed is what 95% of businesses are.
00:23:01You know, most businesses don't have any employees. And even the ones who do,
00:23:05you have such micromanagement oversight on the business that you're addicted to slack,
00:23:09your wife and your friends know it, and you feel good every time you get the dopamine hit of a ping.
00:23:13Yeah. And so if that is you, then the question is, well, what is the opposite of that? And the only
00:23:20reason I can own a ton of businesses today is because I never want to be self-employed again.
00:23:25It was miserable. I mean, it probably led to me not being able to get pregnant for so long and-
00:23:29Congratulations.
00:23:30Oh, thank you. I think it led to stress of, you know, feeling like for the last five years,
00:23:36what if the business couldn't go on without me? Meanwhile, it's growing faster than ever.
00:23:40So if you say the difference between self-employed and an owner is really two things. One, if you're
00:23:46self-employed, that means that either the fulfillment of the product, the sales of the product or the
00:23:52distribution of the product falls entirely in your hands. If any one of those three falls entirely in
00:23:58your hands, you're still self-employed. We got to remove those first. And then if you want to be an owner,
00:24:04actually, that means you have to have the number one thing most business owners don't have, which is
00:24:08transparency. I do not believe you should hire great people and get the fuck out of their way.
00:24:13I used to. That's it. That's actually a disaster because they're never going to care totally as
00:24:18much as you about your business. So you need to have a way to see under the hood and see a dashboard.
00:24:24I think most owners are flying in an airplane without a cockpit and without a dashboard. And so
00:24:31I think the way for you to move from founder mode and self-employed to owner mode would be,
00:24:36what if you could see inside of your business the most important metrics every single day
00:24:40and you could see the two types of scorecards that matter? Activity-based, which you can control.
00:24:45So has my team reached out to all the people that they need to? Has my team done a number of cold
00:24:50calls, emails, right? So that's activity-based. And then outcome-based, are we hitting our revenue
00:24:55goals? Are we hitting our close goals? Is our conversion rate right? Is our churn down, et cetera?
00:24:59Most people only measure the outcome-based goals with very few predictions. So it's hard for them to
00:25:06project out what the future might look like. Very few people measure activity and outcome and have
00:25:12forward-looking projections. And so I think you'll know you're an owner when those three things aren't
00:25:17completely reliant on you and you have a cockpit and a dashboard and you can actually see where the
00:25:21business is going. Sounds really complex to build. It sounds like a big, unwieldy, huge,
00:25:28fuck-off database and I'm tracking all of this stuff. And then you're like, well,
00:25:31are we going to have to get McKinsey in to build this for me? Yeah, that's a good question.
00:25:34Absolutely not. Your business should really run on two main oars, in my mind. I don't believe in
00:25:38North Stars because imagine you're like in a boat with your team. Have you ever talked to the team
00:25:44and they feel like, they're like, Chris, I feel whiplashed in my business. Like one day you say
00:25:49revenue. Next day you're like, where are our follower metrics? Like, fuck, our followers are down,
00:25:53but our revenue's really up. We're annoying them too much with our ads, right? And so the team's like,
00:25:58come on. It's like, you know, you're like pulling a boat like this, left, right, left, right.
00:26:02If you actually want to win in business, you have to set expectations with your employees. And you tell them,
00:26:06hey, imagine you're in a boat and you only have one oar. What happens? Well, you go in a fucking
00:26:13circle. You can't go anywhere. So we can't only focus on revenue. That would be great if we could.
00:26:17We have to focus on some top of funnel metric. Maybe that's followers, leads, et cetera.
00:26:22And so most businesses have two metrics that you can run your entire business on. And if you find those,
00:26:27then your dashboard can actually be pretty chill. It takes a little work to figure out the two of them,
00:26:32but most businesses, and they're not always revenue and followers. It might be, if you're an auto
00:26:38mechanic, you might actually care about what is the average order value that every car has that comes
00:26:44through. And you might care about car count, how many cars come through in total. And if you just
00:26:49nail those two things, you'll know if your business is winning or losing, and that should be it.
00:26:54But most business owners don't even know that. That's outcome, right? What about the other side?
00:26:59Because linking all of these together, maybe, okay, so what are the determinant factors that
00:27:05decide how many cars come through? Well, maybe it's outbound calls that we've been sending. Maybe
00:27:10it's the amount of money that we've spent on a home postal campaign. Maybe it's how good the sign
00:27:16twirler dude out on the street is. Well, maybe, but usually it's, everything's Pareto's principle,
00:27:21right? So the 80/20 rule is almost everywhere. Most of us get overwhelmed because we try to do 552 things,
00:27:26and then realize that like, no, Facebook ads, typically, and cold calls are going to drive
00:27:32most of my conversion and my leads. So how we like to run scorecards is you have your two oars up top.
00:27:38So now you know it's car count, plus it's average order value. So how much people give you each time
00:27:43they pay? Then those go down to each of your teams. And so every one of your teams, if it's your sales
00:27:50team, they're going to have two metrics, and that's probably going to be leads, and it's probably going
00:27:55to be conversion rate or something like that. So, you know, you kind of think about it like a little
00:27:59drop down, but there are only really seven parts or business units in every business from finance to
00:28:05ops to marketing to sales. So that means like you're going to have 14 metrics, but you're going to have a
00:28:11leader in charge of each one of them. That actually is a really clean way to run a business. And you'll
00:28:16be wrong sometimes, and that's okay, but at least you'll know at any given point there's two things
00:28:21we care about at the company overall, only two, and everything number-wise that you guys care about
00:28:27needs to roll up to those two. And if it doesn't roll up to those two, don't talk to me about it until
00:28:32we're hitting like a hundred million dollars in revenue because we don't have enough cash to do it.
00:28:36That makes it a lot easier, at least from what we've seen from running businesses.
00:28:40How much are you thinking about the introduction of AI at the moment in businesses? Because as far
00:28:45as I can see, lots of people get very excited about it. It's super, super sexy. There's this
00:28:49stat, 76% of small businesses now use AI per Goldman Sachs, 10,000 small business voices survey,
00:28:56yet only 14% have it fully embedded in core operations. And from the same study, they said,
00:29:01everyone's dabbling and almost nobody has actually rebuilt their operations around it.
00:29:04But I don't know if trusting AI to run a business is a good idea right now
00:29:12because it might be a dangerous place to leverage. We don't know where that's going to go in future.
00:29:15There's this clawed to raise an entire company's database and all of its backups. There's still an
00:29:20awful lot of concern. Talk to me about how you think about using AI in new small businesses.
00:29:26Amy Quinton: Yes, you do. I mean, it would be a terrible idea to let AI run your entire business.
00:29:29Like it would be an absolutely awful idea. One, I mean, have you tried to have AI just write you
00:29:34something one-shotted? It's the most AI slop. I mean, how much do you want to die every time from an
00:29:39employee? You get a list of questions and it's, it's not X, it's Y, and it's same, same, same, and
00:29:44it's rules of three, right? It's awful. That is like the number one way to not make more money as an
00:29:49employee is to like one-shot writing to your boss. I don't know. The data says that actually AI is not
00:29:55that important for most small businesses, which is super counter to the narrative. You know what's a lot
00:29:59more important? Answering your fucking phone, responding to emails, answering text. Most small
00:30:05businesses respond on average 18 to 24 hours after they get a lead. And the crazy part is most small
00:30:12business owners will fight with me on that. And so, you know, are they saying that that's too long or too
00:30:17short? Oh, we respond right away. We respond immediately. No, you don't. And so if it's me
00:30:23and I'm choosing between AI and response time, it's response time all day. Like what if all you need,
00:30:28so they say that most small businesses, 80% of the reason why you win versus somebody else is that you
00:30:35just respond faster or you come up quicker, right? That's why point of sale is so important at the grocery
00:30:40store. That's why the first plumber who responds back to you is going to win. And yet we spend all
00:30:45this time AI optimizing from all these nerds on Twitter. Yeah, no. So I'm an absolute,
00:30:51for most small business owners, you need to earn the right to use AI by doing like standard business
00:30:56practices. And then you can play around with all this fancy stuff. Such a good point. You know,
00:31:01it makes me think about one of the best hacks that we realized when we started running business,
00:31:06which is pay invoices as quickly as possible. If you are, um, every business needs a graphic
00:31:12designer. You need some new stuff making for you. If you pay, the guy sends the final version of the
00:31:19flyer through and you've done a ton of amends now. Fuck. I'm sorry, mate. It was a nightmare. I'm really,
00:31:22really glad that we got that. Thank you paid that moment that day. If you're the person that pays
00:31:27quickly, the next time that you need to go back to that graphic designer, they will remember,
00:31:31fuck, I didn't even need to chase him. Like, or if you're pushing them for the invoice, hey, hey,
00:31:35get it over now. Cause I want to get it paid two fucking day. That in my experience has put us
00:31:42straight to the top of the list because even if we're just getting charged the same rate as everybody
00:31:46else, they know that we're easy to deal with. Yeah. Cool. Maybe there's a little bit of pain in the,
00:31:50you know, you gotta be a little bit charming on the backend. Um, that's one. And here's the other one,
00:31:54which is, I guess, I don't know whether this puts you in the realm of owner, but certainly gets your
00:32:01foot in the door in rooms that you shouldn't be in. And this was the way that most of the guys that
00:32:05I've worked with have ended up getting in with me. If you're good at something and you say to someone,
00:32:12I'm going to come and work for you. I'm a videographer. I want to work for you as this
00:32:17particular person. I'm going to come across and I'm going to work for you for 30 days. I'm just going to
00:32:21do it. I'm going to give you everything in 30 days time. If you're as good as you say you are,
00:32:26they're not going to be able to let you go. They're going to have to have to pay you and you can call
00:32:33it out. We do this with partners. I don't really talk about the way that I do deals on the show that
00:32:38much, but one of the ways that I've always done them is, Hey, I'm going to do probation period with
00:32:43you. I'll do 90 days or six months. And once that's done, I'm going to give you the deal of a
00:32:48lifetime. I'm going to give you way less than you should in six months time. I'm going to come to you
00:32:52with my handout and you're going to have to pay me and I'm going to make you pay, but I'm going to
00:32:56tell you that this is what's going to happen. I'm going to call out the game. And if I don't deliver,
00:33:00I've taken on all of the risk. And this is the way that we used to get deals back in the day.
00:33:03Between those two things, you're someone that has a skill that you think this person needs.
00:33:07If you can go to them and say, I'm going to do it for you because I care about what you do.
00:33:11And I'm going to show you that you need me. They can't not pay you at the end. If you're as good
00:33:18as you say you are, they can't not pay you. Same thing goes for if you're going to pitch somebody to
00:33:22go and give some sort of a service to their business. I think that I can do this thing.
00:33:26They don't want to let you go. And there's this weird, karmic, psychological debt that we have where
00:33:34you go, fuck, damn it. He put his money where his mouth was and he actually delivered what he said
00:33:39he did. So that's on both sides. If you're somebody that wants to get into the room, just work for free
00:33:43for 30 days. Or if you're trying to get a deal across the line, say, I'm going to give you a deal
00:33:47of a lifetime. And in 30, 60, 90, six months, whatever, I'm going to come with my hand out and
00:33:52I'm going to make you pay for it, but you're going to want to. Or on the other side, if you're somebody
00:33:56that pays invoices, just pay the fucking things straight away. Those, at least for me, have been
00:34:01step change business hacks that have just keep on working. I can't believe they keep on working two
00:34:07decades later, but they do. Yeah. Well, I mean, that goes back to
00:34:10the law of reciprocity. Like why, when you go to the car dealership, do they give you a hot dog
00:34:13and a Coca-Cola, even though most of the time you don't buy a car? Because actually there is an innate
00:34:17human belief that if somebody gives us something, we've got to give them something in return.
00:34:22I owe you. Yeah. And the higher the value to what you give, the higher the belief that I have
00:34:28to give you something in return. I think the law of reciprocity is super underused in both
00:34:32sales and employment. We also have something, I think it's chapter seven in the book, which is all
00:34:36about pitch. And what I've realized is like, most people don't show enough proof. We talk about having
00:34:43a proof vault. Like there is nothing you can say to me now with how the internet is and the lack of trust
00:34:49that exists that would be stronger than you showing me right now live what this tastes like, showing me
00:34:56right now live what somebody looks like who just had it. So why so often do we yap so much and show
00:35:02so little? And I think if you want to get a job and you want to get paid really quickly, one of the best
00:35:07ways to do it, even if they don't want to work for 30 days, because people pillory for us and they'll
00:35:11say, it must be nice. You know, Chris and Cody, you're so rich. And so that's why you could do that.
00:35:16I don't think that's true. I did a bunch of free work when I was super poor, but I like people to
00:35:21show me in loom videos. I'm like, what's the point of an interview anymore? I mean, there's no point in
00:35:26submitting resumes. Like we get probably 2000 resumes for individual jobs that we have open across our
00:35:33companies. That's insane. So instead, I like when they show me and like, what would that mean? Well,
00:35:40let's say you're a salesperson. Show me what your calendar looks like. Just like pull up Google and
00:35:43be like, these are all the calls I have every day. Here's how I stack them. You know, show me the list
00:35:47of people that you reached out to. Show me your process and your CRM for how that works. You don't
00:35:51even have to do a project for me. Just show me how the fuck you work right now. Great. Most people can't
00:35:56do that. And then second would be, all right, now show me what you would do with what I got.
00:36:01And that would be like, give me a project. So most people that we hire have to do a project. We do it
00:36:06paid because I don't want to mess with getting yelled at, but something really tiny to show,
00:36:10yeah, yeah, I can watch me. Here's how I put together your 30-day sales process if I was going
00:36:15to do it. So I think if you don't sell enough right now in business, you don't have enough proof,
00:36:20you don't have enough show, don't tell, and you probably don't have enough show me right now what
00:36:25you could do for me. With AI, you could do almost all of that. Show me a clean house, take a photo of my,
00:36:30you know, house from Google Maps and show me what it'd look like if you painted it.
00:36:34You know, this like one step further than the next guy will help you close so much more. Maybe that's
00:36:40one way to use AI really cheaply fast.
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00:37:37How do you advise people to go about finding the right talent? Because I do think that
00:37:48a big bottleneck that business owners feel is this is my fucking baby and I'm terrified of giving it
00:37:55over to someone that I don't trust fully. And I've been burned in the past because people have made
00:38:01promises when I was earlier and greener in my business career. And the first person that I hired,
00:38:06that was a nightmare. And then I tried to get a family member and that was a nightmare. And
00:38:10what's the 80/20 rules of finding and training great staff?
00:38:17Yeah. Well, I would say one, your first hires are almost always going to suck because you kind of
00:38:21suck when you start. So just don't feel bad for hiring bad people in the beginning. That's totally
00:38:26natural and you're probably not going to do much about that. We have something called the hiring matrix,
00:38:31which is basically this is so there's three steps to finding great people, right?
00:38:36Or getting great people. First, you got to find them, but you can't really find them until you know what
00:38:40they look like. And then you got to know how to close them. So it's like, what do they look like?
00:38:44How do you find them? How do you close them? Those are the three steps to finding great people.
00:38:49Most people say I can't find great people anywhere. And that's because they don't know what they're
00:38:53looking for. It's like chicks on dating websites saying I want six, five blue eyes, whatever that
00:38:57whole thing was. That's not actually what you want. So now you're reverse optimizing for something that's
00:39:02not good. So first we have something called the known candidate matrix. And basically it's five things
00:39:08that will tell you whether this person has a high likelihood of being successful in your business or
00:39:13not. One is proven experience. They've already done this task before. They've been a CEO before or CFO
00:39:19before. Two is sector experience. They've worked in your specific sector. Three is size. They didn't
00:39:25work at Google and your startup because that would be a big jump between the three of them. They have a
00:39:30problem set that they have already nailed. So you could hire somebody from a startup that's have proven
00:39:35experience that is in your sector, but they were in charge of a growth company and yours is a turnaround.
00:39:42You got shit sideways. Somebody's got to fix it. And then the last one is, does this person know anybody
00:39:50in your sphere so you can get a real gauge on if they're good or not? And so that's called known
00:39:55candidate. So I like to rank those all as fives. A top performing candidate is going to be a 25.
00:40:02A bottom performing one is going to be a zero. And what we've seen across hiring thousands of people
00:40:06for these companies is if you can, the higher you can rank on that, the more likelihood you are
00:40:10to win over time. So that's one. It's like, how do you know what a cheetah looks like? You got to figure
00:40:16out that it's got spots, right? And then the second is you got to figure out if you want cheetahs or house cats.
00:40:21So I think most employees are house cats. They're like nine to five. They work in this realm.
00:40:29They don't want to work too much harder than that. They're not going to go out and like find their
00:40:33meals. The cheetah is going to be your 20%. Those are going to be your killers. They're going to really
00:40:38go after it, but you don't need a whole company full of cheetahs. I think that's a misnomer.
00:40:42They're really expensive. They're hard to manage. You should hire divas every time you can because
00:40:47actually divas are the ones that perform over time, but you're going to hear the most complaints
00:40:52about them because we're impossible. Anybody who's really good is impossible to manage.
00:40:56You should be- I'm a dream. I don't know what you're talking about.
00:40:57There's no way. I bet you're so- I love the team actively laughing.
00:41:01Shut up, dude. Shut up.
00:41:04We're a nightmare, but you're so good that you will put up with your
00:41:08bullshit when you're a diva or an A player and that's okay. So you couldn't have a company
00:41:12of 80% of them because you drive everybody crazy. And because most people fill roles,
00:41:19once you have a system and a set incentive stack, you're like, they don't have to be amazing because
00:41:24you go, you do this and then you do this. And if you do that, you get that.
00:41:28And then the third thing is, how do you now actually go out and figure out if these people
00:41:33exist in the world? That's the hardest part. The only way that we've found to do it really
00:41:38consistently is first is referrals. Second is recruiters. Then third is websites. I think
00:41:45recruiters are really underused right now. They're expensive, but they're so worth it. And your best
00:41:50recruiters ever will be your employees. And that will be because you've built a culture that isn't
00:41:54terrible. And they will come because they want to work with other people just like you.
00:41:59- What are the biggest wastes of time in hiring? What are the unnecessary traditions or things that
00:42:07people feel like they need to do as part of the process? - That's a great point. One, don't do
00:42:13hour long interviews ever. I would never, ever have an hour long meeting to recruit somebody until I know
00:42:18that I'm obsessed with them and I want to have them on. And even then I'm probably setting it as a 30,
00:42:2445 minute meeting and you can extend if you want to. But I think 15 minute meetings are totally
00:42:30underutilized. Isn't that weird? Why, when you get into corporate, do they tell you, let's follow up
00:42:36on that when next week? Why did we decide next week? Let's set a meeting for that. It's an hour or 30
00:42:43minutes. Why? Is that what the meeting necessitated? So I think half of this is getting to the first
00:42:48principles of everything in business, which is how do I do the most amount of stuff in the least amount of
00:42:52time and kind of not apologize for it. And so in our hiring process, we're very particular about like,
00:42:58hey, these meetings are really short to the point when I get on, there's not a lot of chit chatting.
00:43:01I'm like, hey, how's it going? You mind if I get right in? Amazing. Bam, bam, bam, bam, bam.
00:43:05The second thing is like, you are really hiring wrong. If you don't have a list of questions that you ask
00:43:10and everybody on the team has set questions, they're not the same. And all the notes get accumulated.
00:43:16You could throw that into AI and they all get stack ranked and scored.
00:43:20Everybody says they do this for hiring. Nobody does this for hiring.
00:43:24What are your favorite questions to ask candidates?
00:43:26Mm, yeah. I mean, my favorite question, it's not just a question. It's, I want to get an answer.
00:43:32Like if you want to find an A player, by and large, an A player is determined by how hard of things have
00:43:37they ever done. Have you done something really hard? And the other, probably month or two ago,
00:43:47we had one candidate I really liked. Smart lady. Going to be super competent in marketing.
00:43:52And I asked her, I was like, tell me about what's the hardest thing that, you know, you've done lately?
00:43:56Like, give me the last 90 days. What has like kept you up at night? What has pushed you farther
00:44:00than you thought? Just let me know. And she said, well, I did. I went on a really hard hot yoga retreat.
00:44:06And I thought, well, fuck, you're not gonna make it. Because if that's the hardest thing you've done,
00:44:11is go on a hot yoga retreat, which I would deem a vacation, you probably wouldn't like this job very
00:44:17much. And so I think you want to try to figure out when was the last time they stayed up all night?
00:44:24Like if you want a high performer. And so a lot of times, that's a really good question to ask. Like,
00:44:29when was the last time you couldn't go to sleep because you wanted to work on something so badly?
00:44:34And you can just tell in their eyes if they're slow to respond. Or if they're like, well,
00:44:38yeah, I don't know, you know, oh, I needed to. Sister's bachelorette party was getting,
00:44:45the flights were a little, sorry. That's not a winner. And so that's super unpopular.
00:44:50People don't like to hear that. And I'll probably get in trouble because people say it's too hard to
00:44:54work in my company. But the flip side is like, good. Like if people like, we also have something
00:45:00called the anti-cell. I learned this from Amjad, who I think you've had on here too, from Replit.
00:45:05No. Oh, he's amazing. I can make an intro if you ever want.
00:45:08But fastest company from zero to billion dollars in sales in like that period of time,
00:45:13not since the beginning of zero dollars, because he went like eight or nine years with zero dollars
00:45:18in revenue. But Amjad has something called the anti-sale for new employees. And I think this is
00:45:24super smart. If you go to his website, and now if you go to mine too, because I stole it,
00:45:28on there it will basically say, do not join if you do not love hard things that almost break you.
00:45:35You know, do not join if you do not want to be, because this is big in technology, if you do not
00:45:41want to be on the frontier of open source as opposed to closed source. So stuff that would be really
00:45:45contentious, put it up front like a billboard. I love, I think one of the best examples of this,
00:45:50which, you know, people on the left wouldn't like, but is Daily Wire. On their website, it's so good.
00:45:54Go to their recruiting page. And it will set, it literally has the most inappropriate meme that
00:46:00they've ever done, which, well, maybe not the most, but the him/hers bars is like front and center.
00:46:05And they make some joke about like, you're not going to like it here if you don't think this is
00:46:08a hysterical joke. It's like a shit test.
00:46:10Exactly. It's a recruiting shit test.
00:46:13Mm hmm. And I think a lot of...
00:46:14And you could do the same thing on the left.
00:46:15Oh, of course.
00:46:17You could do the exact same thing if you were part of like Navarra Media in the UK or something. And
00:46:22you could have, like, if you don't think this meme of Elon Musk's funny, then go fuck yourself.
00:46:25Yeah. Orange man, make him do something crazy on it. But I think, and now maybe you don't want to go
00:46:32that polarizing, which is probably a good idea for most companies not to go that polarizing,
00:46:37but go with what are your top performers all agree with that your mid performers would actually get
00:46:41ticked off about. And that should be what you put on your anti-sale.
00:46:45Yeah. I mean, it works for specific types of organizations. Probably if you're hiring estheticians
00:46:52or salon workers and stuff, you maybe don't need to have them be cheetah energy in quite the same way.
00:46:59But it would be something like if you're obsessed with the newest hairstyles that are coming out of
00:47:07Hollywood. I guess you could do it in kind of a fun way. If you think that Taylor Swift's got swag,
00:47:14then this place isn't where you should work. I don't know. Someone that's not cool.
00:47:18But I remember this such a like canonical example in my learning about business was when Elon bought
00:47:25Twitter and he posted basically the same thing. And he said, I'm looking for people that want to try and
00:47:32attack the hardest problems in the world. There's going to be very little rest. There's going to be
00:47:36very little respite. You're going to work harder on the biggest problems to try and create the new town
00:47:40square. If you're interested, apply here, like twitter.com/jobs or something. And there was this
00:47:46big sort of furor around it, him saying it's going to be 80 or 90 hour weeks. You're not going to get
00:47:51any spare time. There's no PTO. There's no nothing. You come here, your eyes bleed, you go home,
00:47:56or maybe you don't go home. You just sleep under the desk and you get back up again.
00:48:00But what that didn't account for is there is a cohort of people out there for whom that sounds
00:48:06like a good time. That actually is what you want. And in the kind of the same way as who are you to
00:48:13kink shame me? Like don't say that me being walked on a leash with a dog mask on is something that
00:48:19shouldn't be allowed. Like that's what I'm into. That's what they're into. They're into that. And yeah,
00:48:25the world is split into people who want to send it professionally and people that don't. And the
00:48:31people that don't kind of won't really understand the people that do. And when I saw that, it really
00:48:38just reminded me, oh, fuck. Like you're allowed to own your intensity. You're allowed to own your
00:48:45intensity and actively seeking people by positioning you as not the opposite of it, right? As not
00:48:55gently, gently into the night.
00:48:59That's a really great way to say, this is what we stand for by this is what we stand against.
00:49:03Yeah. And I think like, do you really not like being intense or do you just not like the things
00:49:09you're doing right now? I actually would hazard to guess most people, if they could do the thing that
00:49:14they really want to do deeply inside, you would go full bore and do it. And everybody has had that
00:49:20feeling before where you get lost in something, you lose track of time, you get into flow state,
00:49:24you're obsessed with the thing that you're making, building, reading, watching, whatever,
00:49:28but you haven't figured out a way yet to do that for a living or to have some aspect of that in what
00:49:32you do. That exists in your day to day life.
00:49:34Yeah. And I think you can like, I don't love everything about running a business. There's
00:49:39so many things I hate about running a business and I just try to do less of them. It's like,
00:49:44are you burnt out or are you just not doing enough of those things you actually like to do?
00:49:48I keep getting in trouble every time I try and say this on the internet. So I'm going to try and do
00:49:51it again and get in trouble again. I don't think that introverts truly exist. I think that most
00:49:57people's friends just suck. And every single time, some fucking midwit that once watched a psychology
00:50:05video goes, well, actually the way that it works with introversion and extroversion is it's a measure
00:50:09of where you take your energy from. It's whether you take your energy from being on your own or being
00:50:12around other people. I'm like, okay, I fucking know. All right. I know the literature around
00:50:17introversion and extroversion. My point is that even the most introverted person on the planet around
00:50:24the right group of friends doesn't want to leave the conversation. And I think it's the same thing
00:50:28here. I think you're right. Even the most work shy, lackadaisical, laissez faire, 3:00 PM wake up,
00:50:36weed smoking person, if you give them the right concoction of life, will want to send it. That being said,
00:50:44I also believe that there are some people who are serial obsessives and some people for whom the
00:50:50obsession, the obsessions are kind of once in a blue moon. I'm someone that's been serially obsessive
00:50:55across my life. I was obsessed with getting in shape. I was obsessed with running nightclubs. I was
00:50:59obsessed with DJing. I was obsessed with business. I got obsessed with CrossFit and Thai boxing and then
00:51:04yoga and then podcasting and then moving to America, became obsessed with the country for a while and
00:51:11became obsessed now with the beverage industry and CPG. And now I'm obsessed with cinematography.
00:51:16And it's just been stacking these things side by side. Fortunately for me, it's been relatively linear.
00:51:23Like I haven't bounced between, whiplashed myself with very spurious pursuits. I've been relatively
00:51:32linear. So I've kind of been able to build a set of dominoes that almost maybe even compounded.
00:51:37Some people are like that, other people less so, but, and this is my pitch to people who have
00:51:43obsession. A lot of the time I get messages saying, I'm obsessed with this thing and it's kind of ruining
00:51:49my life and I can't stop. I'm like, that's not going to last forever. That fuel is going to run
00:51:56out at some point. And your fear is I have no work-life balance and it's never going to end.
00:52:03That's the concern. But the freest discipline and motivation that you're ever going to get is when
00:52:08you're obsessed, right? This hierarchy of discipline, motivation, and obsession, it's all to do with
00:52:13friction. So, uh, discipline is friction accepted. I will pay the price. It's going to hurt. I'll pay it.
00:52:21Motivation is friction removed. It's like, I want to do this thing. And obsession is friction inverted.
00:52:29I can't not do this thing. I have to, I'm pulled toward it. This is not going to last forever. Your level
00:52:35of obsession around CrossFit or Thai boxing or your business or your girlfriend, like is not going to
00:52:41last forever. So like, allow it to wear you for a while. I think that it's cool to be a serial
00:52:47obsessive because this obsession is going to cool down into, it's going to harden and like ossify into
00:52:53what looks from the outside a lot like your identity. After a while, what you are is this, the residue
00:53:01of your past obsessions, like previously you would have been obsessed with business in a manner that
00:53:07you're not anymore, but there's elements of that, that aren't still active, but they're just a bit
00:53:13of you like this. Huh? They're just a part of my personality. Anyway. No, I think you're, I mean,
00:53:18I totally agree. The only thing that I would add to it is like, I think you, you have to have, it's like,
00:53:26have you done what you want to do or have you done what's required? And I think a lot of times when
00:53:30you get obsessed, you get selfish on the part of it that you get obsessed with. And most people don't
00:53:35think about how to connect the dots to have a series of dominoes that fall. So you get obsessed
00:53:41with one thing, but you don't think at all about stacking a bunch of chains so that you actually
00:53:46build something that can create leverage or pull for you over time. And so you wouldn't be so freaked
00:53:51out about being obsessed with something if you saw that that obsession would lead to a little bit
00:53:55more freedom eventually, would lead to a little bit more money, would lead to not a have to,
00:54:01but a still want to. And I think I've been there. I mean, I've been in a business so miserable. I
00:54:07wanted to get about making seven, many, many, seven figures a year, walk away from my equity entirely,
00:54:13because I was so obsessed at some point and I never built the chain to where I had an out. I just,
00:54:20I built myself a really tall pedestal I could not jump down from.
00:54:23And I think that's the difference is like, yes, be obsessed, but think about the chain link.
00:54:28And like yours is like that. Yeah, you're obsessed with cinematography, but you're not like,
00:54:32oh, fuck the podcast. I'm going to go start a documentary and never do this again. You know,
00:54:36you link the two, even if you have that moment, I call it a someday maybe list. Like,
00:54:40I think if you're a little bit ADD, like I am, and you're always adding things to your plate,
00:54:45or you're getting distracted, you've got the golden retriever thing. I keep a little list on my phone.
00:54:50It's not so little, actually, it's huge. And on it, it's called someday maybe. And on it is a bunch
00:54:54of shit that I'd like to do one day that I'm just not going to do right now. What like?
00:54:58Oh my God, everything. Like, I do want to, I want to own a puppy farm. I want, I want,
00:55:03that's like my rich people shit. You know, have you met a lot of like rich people that do weird
00:55:06things? Okay. I never understand really. I'm not into fancy stuff. I'm looking for a golden
00:55:10retriever breeder at the moment. Oh, okay. If you can hurry up and get that sorted before.
00:55:13Absolutely. December, January time. Like I would like, that would be,
00:55:17that's like my retirement plan. I want to be like Oprah Winfrey, not with golden retrievers,
00:55:20equal opportunity. We don't, you know, we don't have dog specific races, but, um, but a lot of
00:55:25it would be like, write this next book, build this next business, buy this next business. I've bought
00:55:29a lot of businesses in my day. I had to stop buying so many because they didn't make sense for our new
00:55:35ecosystem. And my team would yell at me, like, can we focus for a second? Because, you know, focus is
00:55:40like a laser, you know, the wider it is, the less intense it is. And so if you can narrow your focus,
00:55:45you can really win. So that would be my only caveat. It's like, be obsessed, but try to figure out a way
00:55:50that can lead to some freedom or some money for you. Cause then it'll be an option in the future.
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00:56:50That's functionhealth.com/modernwisdom. Let's say someone who's running their business has turned it
00:56:57into their identity. What do people do with their sense of self-importance if they slow down or begin
00:57:03to use more leverage? Because I think this is one of the mistakes that people make when they think about
00:57:10scaling up inside of business. They assume that doing less spit and sawdust work means
00:57:18less importance, but it's actually more leverage and more leverage from the outside looks less busy.
00:57:23But it's the first time that someone has to face themselves. Finally, they've got all of this
00:57:27self-importance and now they're slowing down, at least objectively. Talk to me about the emotional
00:57:35movement, the transition that people need to go through there.
00:57:39Well, one, I would say if you are an obsessive type of person, you're probably never going to slow
00:57:45down. You're just going to change lanes. So instead of starting to like going on the highway at 50 miles
00:57:51an hour when the speed limit's 75, you might never like that. But you won't feel like you have to go 75
00:57:57on something that you don't want to. So realize that you can always just change lanes.
00:58:01What would be an example of that? An example would be in your business right now, you might be what
00:58:05we call a ball hog that closes every deal. Like every deal has to go through you. You're the one that gets
00:58:10the sponsors. You're the one that gets the partnerships. You close all the deals. And if you stop
00:58:14doing that, are you going to be seen as a sales god anymore? Or you're going to transition these
00:58:18relationships and then you're not going to have them anymore because other people are going to steal
00:58:21them from you. You just offload that one part of it. And instead you go, okay, I was pretty good at
00:58:26selling one to one. What about selling one to many? Let's do content now. Could I figure out how to do
00:58:30that? So just change lanes slightly, add a new skill that has higher leverage. Because really you can only,
00:58:36like business only is so many things, which is really, can I sell something for more money
00:58:44that I pay for it? Like that's kind of it. And so if that's all business is, then we can just change the seven,
00:58:50you know, uh, segments of the business and do a different part of them. It could allow you to go and
00:58:57learn how to write more. It could allow you to go and hire people better. Um, but I guess the only thing
00:59:01I'll say about like that deep, dark part of you that feels like if you no longer are the man, you aren't
00:59:06a man or, you know, a woman at all anymore. I think for that, you've got to ask yourself,
00:59:14what do you think is more valuable? A business where you can take it and sell a job to another
00:59:20human? Jobs aren't transferable. Or a business where it's so good, you are so good, the business
00:59:24runs without you. And I think the usual, like the way that I usually can get out of being upset about
00:59:29something like that or worried about my identity is I look at a person in the future that I'd like to be
00:59:34like in that business sense. So, you know, I, the, the goat is obviously Warren Buffett,
00:59:40you know, he sort of religiously talks about how little he does. Does anybody think less of the
00:59:45man? No. So like, it only takes one example to go, oh, that's a complete mental fallacy I have.
00:59:51Why did I hold on for so long to something that is so not true?
00:59:54It's interesting. The Puritan work ethic, which coming from the Northeast of the UK is
01:00:01almost like a religion. Yeah. Uh, you know, good example of that from my last industry was
01:00:07we would run nightclubs and as a club promoter, you don't own the venue, but you have marketing and
01:00:14networks and 500 staff that bring their friends down and, you know, DJs and, you know, social media and
01:00:19you, people think you're cool. And then you have venues. Venues have got a building and a license and
01:00:24door staff that punch people and, you know, speakers and DJs and stuff like that. Yeah.
01:00:28And the gap in between building with no one in it and people who want to party, that's where the
01:00:33relationship lies. There is no fucking reason that I need to be on the front door of a nightclub.
01:00:38Certainly not on the front door. If anything, I need to be down in the DJ booth so I can see what's
01:00:42going on. What's the atmosphere. Did that most recent pyrotechnic show go off correctly?
01:00:46What's happening with the till? Have we got all the, you know, the rest of the stuff. My side,
01:00:48you sort with the bar, keep the fucking lights on. I'll do everything else. Just get out my way.
01:00:53Problem is if it's the middle of November, it's freezing fucking cold in Newcastle and the manager
01:00:58of the venue is outside to make sure that his big hairy door staff don't punch seven shades of
01:01:02shit out of everybody. He expects me to be out there as well, because there is this,
01:01:08if you're not suffering along with me, you're not in it with me mentality. And that took so long to
01:01:15unwind and lots of businesses, I think still have this. If I achieved it, but I didn't suffer,
01:01:24it didn't matter or it doesn't count. If I don't see you proselytizing yourself, you know,
01:01:31a prostrating yourself, sorry, on the fucking crucifix altar of whatever this business is,
01:01:36you need to be the first person in and the last person out. And yes, for a very long time you do.
01:01:40And the kernels of truth that are in this are why it's so pernicious because you're like,
01:01:45I do know that. And also, by the way, I'm trying to hire the cheater that is staying up all night to
01:01:50do this thing. After a while, you can't lead from the front anymore. And that took a very long time
01:01:55for me to unwind and also separating out, especially if you've got other parties that are in and around
01:02:01this, you've got maybe partnerships outside of that, like working on the front door of a nightclub.
01:02:06It's like, Hey, I need to have a really serious conversation with where my value adds here.
01:02:11It is not my highest point of contribution for me to be stood on the front door at one in the morning,
01:02:16freezing my tits off with you. My highest kind of point of contribution is to be dealing with DJs and
01:02:21Buckings and making sure that the accounts are right. 9am tomorrow. So we need to change the way
01:02:26that this works. But that Puritan work ethic and unwinding it is very difficult. It's very, very
01:02:32difficult. If I might make a suggestion, I think it always works the best when you don't make it about
01:02:38you. You make it about them. I try in my conversations with my team to almost say nothing
01:02:44about what my highest value is. Instead, my conversation with your doorman would probably
01:02:50go something like this. I'd be like, all right, Brad, dude, freezing out there today. It's going
01:02:55to be intense. People are going to be rowdy. You're probably going to want to hit them in the fakes.
01:02:59I feel like I should be out there, but I know that you've been doing this for X number of months now.
01:03:04Like you're a pro. You don't actually want me over your shoulder doing that with you
01:03:08because you want us to earn more, bring more people in, get the club full. Is that right?
01:03:14You'd have to know that that is what he wants. Yeah, I actually do want that. Or you know that,
01:03:19God, we're having problems in the back end. I can't get them to spend enough. I'm going to go
01:03:23back there. I'm going to try to get them, do bottles, sell it. This is what I'm going to do
01:03:26instead of. Exactly. And you are getting their buy-in to your highest and best use as opposed to saying,
01:03:34my highest and best use, what do we always like to hear? One, we like to hear ourselves talk.
01:03:38And two, we like to believe everything's our idea, not somebody else's idea, right?
01:03:41So if you can get your employees to think it is a good idea for you to not be there,
01:03:46that's when you get them. And then again, you go back to that like five quadrant.
01:03:49If you know Brad really cares about money, you play with money with Brad. If you know Brad really
01:03:53cares about relevance, he's like, I fucking, Chris, I don't need this. I don't need you over my,
01:03:57you think you're a tough, like, listen, I'm not actually as tough as you, you do it.
01:04:01And so I think we don't sell enough inside of our companies. We don't sell enough to our bosses,
01:04:07to our coworkers. We try to do two things. I see it all the time. We try to be a dictator to our
01:04:13employees. You have to do this. Why haven't you done this? Or we try to be a doormat, which is like,
01:04:19okay, I'll do it. I'll be fine. You're either a dictator or you're a doormat.
01:04:22Not between the two extremes.
01:04:23Yeah, exactly. Probably most of us do that. And employees do it too, as opposed to,
01:04:27why aren't you trying to be so persuasive to the people around you in business that you can get
01:04:32them to do the things they want to do without them even realizing that it was your idea, not theirs?
01:04:37That is when you really win in business. And it takes a minute. In the beginning of this,
01:04:43I had to do a ton of psychological sales. I had to learn about priming, which I had to learn about,
01:04:49okay, when I have this conversation with Brad, I'm actually not going to do it when he's outside
01:04:53and it's cold and he's already pissed. I'm going to do it when he's inside. It feels good. I'm
01:04:58going to bring him up a hot coffee. I'm going to be like, Brad, let's sit down and have a conversation.
01:05:00Take a seat off for a second, right? That's called set and setting. I'm going to prime him
01:05:05to feel like he's really important. We're having an intimate conversation,
01:05:08and then I'm going to send him off there. It's the same way with your significant other. How many times,
01:05:14I'm sure you never have you had a fight with your significant other or girlfriend, right?
01:05:19And she's pissed and raging at you. And you're like, let me rationally talk to you about this.
01:05:26And this is why all the reasons that I'm right. And she listens to you. Like that doesn't happen.
01:05:31You know, it doesn't. And so when would be a better time? You listen. And then the second you're no
01:05:36longer pissed, you hand her a glass of wine. You two sit down and you're like, let's talk about this.
01:05:39This is kind of my perspective. So with your team, think about, do you really need to be the hero?
01:05:45And do they want that from you? Are you just not a good sales person yet to them?
01:05:49What about the other side? What about disciplining staff saying, hey, look, Brad,
01:05:57we need to have a really serious conversation here that things aren't going well and I need to really
01:06:03tell you where I'm at. How do you think about broaching that?
01:06:06I think most people quit jobs because they have terrible bosses and their terrible bosses are not
01:06:11bad because they overly discipline them. They're bad because they never tell them the truth. They
01:06:15gaslight them. They tell you that, you know, you're winning even when they're not. They wuss out on
01:06:20tough conversations and they don't tell you how to win. They just tell you why you're not winning.
01:06:25And I think we've all had that. I think most people don't like conflict and most people's leaders
01:06:30are not good leaders because it takes a lot of training.
01:06:32What's your advice for leaders that don't like conflict then? How can they get better at it?
01:06:35You sit down, you don't think about it as conflict. You sit down and say, I want to have a
01:06:39conversation and I'd like us both to win. You know, I'm the leader over this. I have these metrics for
01:06:45you as an employee. I have these metrics for me as a manager. You're not hitting these metrics,
01:06:51which means I can't hit these metrics. What's going on? Then you're going to listen to a lot of stuff.
01:06:55And you're going to say, well, at the company, you know that we work on 90-day plans. I run all of
01:07:01our businesses on 90-day sprints. It's kind of like our core owner be owned. And the reason why is
01:07:06humans work in cycles, right? Birth, growth, decay, winter, summer, spring, fall. And quarterly cycles
01:07:14work really well for businesses. And so you would sit down and say, over this 90-day period, we got to
01:07:20start hitting these numbers. And if we don't, how do you think I could keep running a business in which
01:07:26our team doesn't hit their 90-day numbers? Do you think we could keep doing that and paying everybody?
01:07:30What are they going to say? No. Okay. So over the next 90 days, we're going to check in every 30 days.
01:07:35And if we don't keep hitting these numbers, I can't keep you here. Like that's reasonable,
01:07:40right? Am I crazy? Should there be a way that I can keep you even if you don't hit all the numbers?
01:07:45Well, what about this? What about this? Hey, listen, we have to be fair to everybody.
01:07:49You might be my favorite person, but if you're not doing it, I can't just say that's okay for you.
01:07:54So we're going to check in every 30 days and we're going to see if we're hitting these numbers or not.
01:07:58And this is so foreign to most people because it's a bunch of PC bullshit in corporations about,
01:08:03well, I don't feel like you're doing that well. And Sally said, and HR is in the middle.
01:08:08Like how often have you just sat down and said, here's what you're supposed to do.
01:08:12You're not doing X. Either why not? What can I do for it? And how do we fix it by 90 days?
01:08:17Otherwise we've got to part ways because maybe you'll go be a superstar somewhere else.
01:08:21What are the things that a founder should stop personally approving first?
01:08:26Oh God. Yeah. Well, let's do a generalist. If you're a founder doing this currently,
01:08:32you're doing administrative work at a minimum wage of a virtual assistant,
01:08:36which would be responding to emails by and large that needs to go immediately.
01:08:40If you are doing any sort of automated reporting for your business, so reading out of numbers,
01:08:45scorecards, et cetera, see that a lot in businesses. If you are approving any invoice that is less than,
01:08:53depending on the size of the business, one to 10% of your revenue. If it's a really small business,
01:08:59that's why it could go up to 10%. That's probably not something you should be doing continuously.
01:09:03And you should be using something like ramp, which I don't have any affiliation with, but
01:09:07can track all of your expenses of your employees instead.
01:09:12And then probably the next thing that you need to be doing is thinking about how many employees.
01:09:16I also think we were told a big lie as leaders. And the lie was, you should have an open door policy.
01:09:24You should be available for everybody on your team, but an open door policy just means that you are on
01:09:30everybody else's schedule, not your own. And as an employee, I think you should guard against it too.
01:09:35You shouldn't allow people access to you every second of every day continuously. Instead,
01:09:40you need to set up ways and means to get to you only when they have what we call the three,
01:09:46which is basically problem, potential solution, risks to potential solutions.
01:09:52Then if you have those three things, let's talk. And if you're just bringing me a problem,
01:09:55you're not ready. Go back and work on it a little bit.
01:09:58But all of this stuff is so hard because you sound like a hard ass when you say all of it. And then
01:10:04everybody's like, she sucks. Be a terrible leader. That would be the worst. But I think the worst leaders
01:10:11actually are the ones that seem nice and then never help you make more money, never help you progress in
01:10:16your career, never help you get better, never help you get promoted. What a fucking tragedy. Who wants
01:10:21to work for that person? And I think that's most people. And then they wonder why they hate their job
01:10:25and don't make as much money as they want.
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01:11:30Why do you think so many entrepreneurs are afraid to charge more?
01:11:33Oh yeah. Well, I don't think you have a pricing problem. I think you have a confidence problem.
01:11:38I mean, one of the first things I said to one of the business owners in our group was,
01:11:41I can tell about your lack of confidence in yourself and your business by your price.
01:11:47Because most people price according to market pricing, like here are what other people charge.
01:11:52Well, why do you think other people have any fucking idea how to charge in your space? They don't.
01:11:58Everybody's just guessing by and large, and most people haven't done any research at all. So people,
01:12:03one, don't have confidence. Two, they do market-based pricing. And three,
01:12:08they don't understand value-based pricing. Which is basically, I give this much value in savings or in
01:12:15revenue or in freedom or whatever it is, and I'm going to take somewhere between 10 and 30 percent
01:12:20of that value that I drive you. That's just like the number. But when you look at how many business
01:12:25owners actually do that, we all are so scared of getting told no ever since like our first high
01:12:30school date told us that we couldn't, that I think it translates straight through to our prices.
01:12:35And then, perniciously, a lot of us as entrepreneurs have a murder complex where we think
01:12:40it is good for us to not charge. Charitable.
01:12:43Yeah. That means I'm a good person. I don't sell to, you know, I don't sell expensive things,
01:12:48so I'm good. Get the fucking money. Get the fucking money.
01:12:50Get the fucking money. And don't now, don't sell a shitty service. That's what you should be worried
01:12:55about. Do not provide enough value. But you should never worry about, do I charge too much? If you
01:13:00provide enough value, the price spectrum is unlimited. Last thing I'll say on this, it's kind of nerdy,
01:13:05but we break it down. Is this wallet share phenomenon? Have you heard of this?
01:13:09No.
01:13:09So, fascinating study that basically says, basically saw, you put a group of pricing experts in a room,
01:13:18many, many times over, and normal people in a room. And you knew a couple things about them. You knew
01:13:24what they were worth, so, and how much they made per year, net worth and income. You would think that
01:13:29the pricing experts across net worth and income would be better at determining the right price for
01:13:36something than a group of random people, right? Yeah, that's their job. Well, it turns out those
01:13:41people were no better at pricing than the random people. In fact, they actually priced about 15% lower
01:13:47than the random group. Why? Because of something called the wallet share phenomenon, which is most
01:13:51people will only price about 10% to 15% higher or lower than what they could afford. And this happens
01:13:59across almost every business. So, you are actually restricted by your amount of money you make without
01:14:05even realizing it. It's a subconscious bias. But sitting out there is somebody like Chamath, who would
01:14:10spend a bajillion dollars on a sweater, and you can't even conceptualize why that would be worth it to
01:14:15somebody. And so, in business right now, you've got to ask yourself, one, what's holding you back because
01:14:20of how much you make? But even more so, what about the other people on your team? Because they're
01:14:25probably, employees on average, have a 30% lower pricing range than owners think they do.
01:14:32So, your employees are dragging down your profits by 30% and you don't even realize it,
01:14:36which is crazy. When I heard that, I went and analyzed our business and saw, "Oh my God,
01:14:40it was the same for me." And so, that's a good realization to have. You don't have a pricing
01:14:44problem. You have a confidence problem. So many people are undercharging. God, almost all of my
01:14:50my friends, especially people in service businesses, right? It is insane. I have
01:14:57a couple of friends who've done features on records. These records have gone on to do
01:15:04tens of millions or hundreds of millions of plays. So, they're an integral part of a unique part of a
01:15:10music track. Even in retrospect, they're not thinking, "I undercharge for that." I'm like,
01:15:22"Dude, this is one of the biggest things that's ever happened." And you still can't bring yourself the
01:15:29next time that the opportunity comes around to turn the screws on. It's almost like you want to shake
01:15:34people and go like, "You don't understand how good you are at what you do. You can charge more."
01:15:39Well, that's fascinating because that's why we do this thing called Owner Score that I was telling
01:15:43you about before this. And if you go to ownerscore.com, it's free. You can do it. But basically,
01:15:48those people are usually either the artist or the dreamer. And so, it's funny because they literally
01:15:54are an artist in this instance, but the artist almost always underprices in everything that they do. And
01:16:00so, even if they're at the top of the food chain in their industry, they have a predilection to think
01:16:06charging more is actually greedy. And so, the interesting part about business, the part that
01:16:12like kind of got me ticked off at some point is I started thinking, "Have you ever started watching
01:16:17like really good business people online?" And you're like, "Elon Musk." And you're like, "Well, if I just
01:16:23follow Elon's directions, then my business will grow. Like I'm just going to listen to his advice
01:16:27because he's a mega billionaire." Well, that's sort of problematic for a lot of reasons because one,
01:16:32you and I aren't as good as Elon Musk, right? Like if we were, we'd be billionaires. We're not.
01:16:37He's an anomaly. Second is I don't want his life. Like with much love, we know a lot of people in common.
01:16:44I'm happily married. I'm gonna have a kid. I like to hang out a little bit. Like I want to enjoy life.
01:16:49I want to be fit. Not now, but again, eventually. And so, it doesn't work on two fronts. I'm not Elon.
01:16:58Plus, I don't want his life. And so, if you take business advice from somebody whose life you don't
01:17:05want and who has skillsets you don't have, you'll be fucked even if the business advice is great.
01:17:12And so, I was like, "God, we have like these thousands of companies. Why could I have HVAC,
01:17:17HVAC, HVAC company? All the same information, same revenue, same team. And there's total variance."
01:17:24Wildly different performance.
01:17:25It's because of the founder, right? But if I know, "Hey, founder A is an artist, so he's probably
01:17:30underpricing, just at the gun," then I can have different advice for him than I can have for closer
01:17:36founder, which I know probably doesn't have as good of fulfillment or creative in his business.
01:17:41And so, like, it seems standard, except nobody does it. Everybody starts with, "What's the best
01:17:47business advice I can do?" Yeah.
01:17:49As opposed to like, "Who are you?" If it's one size fits all.
01:17:51Yeah. And I just don't think that works. And there are some core business principles,
01:17:56but you have to apply them to who you are as a human. Otherwise, you'll be miserable,
01:17:59even if you end up getting rich. Related to the price thing,
01:18:02when do you think a founder should start paying themselves properly?
01:18:05Immediately. Like, almost immediately. Even if you can't afford it, what would that mean?
01:18:10Put it on your profit and loss statement. Like, and just write a little loan to yourself,
01:18:16or put it in a spreadsheet so you know going forward. I think a lot of times
01:18:21founders will spend years, you'll spend years not making any money and thinking that you have
01:18:26a profitable business, but really the only profit is your labor. And basically it's slave labor at this
01:18:31point. Right. So the founder's free labor is disguising bad economics inside of the business.
01:18:36100%. And you can't fix a business if you don't understand the underlying math. And so I always
01:18:42start with like, pay yourself a market rate salary. It's super easy to figure out what that is. Go online,
01:18:46say market rate, this size company, this industry, this location. Okay. I'm going to pay myself that.
01:18:51If I can't pay myself that in year one, okay, that's okay. If I can't pay myself that by year two,
01:18:57that's actually not okay. What are you doing?
01:19:00Yeah. Then you're doing something wrong. And that means that you either have to probably usually raise
01:19:05your prices, sell more expensive things, find rich people. They like to pay more. But I think, I mean,
01:19:12if it's, I mean, like what a wild thing. There's, so let's see, last year there were 5 million
01:19:18businesses created. That's the most businesses that have ever been created before in history. In like 2019,
01:19:25we should check my math. I think it was a couple hundred K, somewhere between 200,000 and 500,000
01:19:30businesses created. So we've had more businesses created than ever before. And yet we have less
01:19:36profitable businesses than we've ever had before. And entrepreneurs' wages continue to go down.
01:19:41So you look online and everybody looks like they're Gucci, Fendi, Prada, you know, Lamborghini,
01:19:45whatever, and they're not, and they're, they're actually poorer than most employees.
01:19:52Yeah. So it's like.
01:19:53It would be better to work for you than to run it.
01:19:54It would be a thousand percent better. And so why are we doing that to ourselves? Let's look
01:20:00ourselves in the face and be honest and say, all right, I'm not quite ready for this game yet.
01:20:03I mean, if your company becomes enormous or reputable and it still owns your life,
01:20:11I don't think you can class that as winning. I don't think you can class that as being successful.
01:20:16And I, I'd love to ask a question of a lot of founders. I'd love to ask
01:20:21if nobody ever knew that you founded the business, would you still want to own the company?
01:20:27And I think that a lot of them wouldn't, you know, the best example of this, I had Ben Francis on the
01:20:30show a few years ago, Gymshark founder, 70% of the companies owned by him, completely bootstrapped,
01:20:37took some advisory thing or a few people have got some percentages. He's in there 70%. He's worth
01:20:43like two bill pounds, right? Fucking pounds. That's like $3 billion. And he was co-founder, CEO,
01:20:54then stepped out of the business entirely from a hundred million to 500 million. And the guy that
01:21:02used to run Reebok came in and then at 500 million, he stepped back in and he gave me this line and he
01:21:08said, when your aspirations for the business are bigger than your aspirations for yourself,
01:21:11you'll become a successful entrepreneur. And I was like, that is great. That is so good. I
01:21:16care more about the success of the business than my own ego. And you can say, this is actually an
01:21:22acceptable thing. It's like, do you know what it is? I take so much pleasure from being a business
01:21:27owner from playing the game of business, even if I'm playing it badly by most of the metrics that you
01:21:33would assess the business by, but I just love the impact. I love the significance, even like giving
01:21:42it to myself, being a business owner, being able to say that it's my thing and my baby. And I get to,
01:21:46you do the obsession thing that that's cool, but don't kid yourself that you're doing business. You are
01:21:52playing the game of business that I'm playing it at least by most metrics pretty badly. And yeah, I,
01:21:59if nobody knew that you founded the business, would you still want to own it? I think it's a great
01:22:04question. It's, and you know, I took me, it took me 12 years of working for other people before I went
01:22:11and started my own thing. You know, I actually, I was way more risk averse than you and a lot of the
01:22:16people that we know who just went out and did this crazy thing. I didn't like that idea. I wanted to
01:22:20sleep in my own bed. I didn't believe in sleeping in like closets and couches and garages. You know,
01:22:26I wanted to, I'm not that fancy, but you know, I wanted to be able to go on vacations and do all
01:22:30the things. Eyebrow raise, I saw that. I know now I can actually eyebrow raise again because when you're
01:22:34pregnant, you can't get Botox. So it's a real tragedy. But, um, the, uh, like it took me a long
01:22:41fucking time to take the risk. And I actually think that's totally fine. I think if you're scared
01:22:46and you want to stack cash and you only want to build on the side, that's totally fine. And you
01:22:51have to stop listening to people who try to get you into entrepreneur porn when in fact you could just
01:22:56own a part of the business. You could invest in a bunch of businesses. You could be really successful
01:23:00as a number two and be way happier. And that is totally okay. And I think we got to normalize some
01:23:05people saying that if you, in the same way as I mentioned before, you can go to somebody that has
01:23:12a business or, or is in an industry that you're really desperate to go and work in. You could do
01:23:16the same thing. I bet that you could roll the dice and say, I've worked in a similar or completely
01:23:23symmetrical industry for a very long time. I think that you need an operator. I'm going to come in
01:23:28and I'm going to take, I'm going to be your right hand. I'm going to be the sword that cuts through all
01:23:32of this bullshit inside of this business. And I'm going to do it for fucking sweet nothing.
01:23:36And in 60 days, we're going to have a little review. And I just want to see what happens.
01:23:39You could go to that person and say, I want to take 50% market rate salary. And I want 10% of the
01:23:44business over the next couple of years. Let's see how we get on. And then you build it up and build it
01:23:48up and build it up. And as long as you've got good enough contract, guess what? You're a legitimate
01:23:53business owner with none of the issues of having to fucking start it, find it, get your market position.
01:23:58I think it makes sense. Ultimately this challenge for most people that this relates to will come
01:24:05down to an emotional one. Can you relinquish your identity of being the person that was supposedly the
01:24:12one that fixes all of the things, keeping on top? Can you deal with problems occurring? Are you going
01:24:18to be able to have the hard conversations when you need to? And if you can do those things, I think you'll
01:24:21be successful. And if you can't, I think you're going to kind of be trapped in the same hamster wheel.
01:24:25Yeah. And I think it's not just, do you want the business to win more? I think you really start
01:24:31winning in business when you want your customers to get bigger than you because of the things you did
01:24:37for them. Like you want to be the mentor that has a bunch of mentees who are way bigger than you are.
01:24:42And you want to be the employer who has a bunch of employees that you want to invest in,
01:24:47in the future. Like one of the, you know, I mean, many of, uh, many of the greats, like if you think
01:24:53about, uh, Antonio, uh, Gracias, uh, head of valor, uh, one of the, I mean, I think he made 40 billion
01:24:58dollars on Elon Musk's space X transaction. That's probably more than Antonio's ever made in his life.
01:25:05And it's because of Elon, because he invested in him. Uh, and also Elon was an employee, kind of got ousted
01:25:13from PayPal by, you know, Peter Thiel and a bunch of the founders fund guys, didn't have an ego about
01:25:20it. Like I'm sure was super pissed, could felt like he could have taken that company to the moon,
01:25:24but he just ate it and said, I'm going to keep a relationship with these guys. They're going to
01:25:28fund me in the future. They, they come in and save him later when they almost run out of capital.
01:25:33And, uh, because of that, Elon was able to continue his company and take it to new heights. And now,
01:25:37you know, Luke Nosek and a bunch of guys here in Austin are also going to make billions of dollars,
01:25:42not off of their work, but off of Elon's. And those are people that he used to report into or partner
01:25:48with stuff. Right. And so it's one of my favorite parts about finance and investing is it teaches you
01:25:53that you don't always want to be better than your employees. You actually want winner employees
01:25:57because when they leave, you should go, what are you doing? Can I throw some pennies at that?
01:26:01What is that? Let me in there. That's how the rich people, like rich people do not think in terms of
01:26:06their labor. Rich people think, where can I put some money and leverage to play so I could do less
01:26:12and make more. And they feel no fucking shame about it. And then, you know, you and I, because I came
01:26:17from nothing and my entire identity, I'm what's called a workhorse. My entire identity was wrapped
01:26:22up in Cody's good because Cody works a lot. I feel bad when I don't work. And because of that,
01:26:29I actually miss a ton of opportunities where I get to invest in somebody else and they work harder than
01:26:33me. I don't even have to do anything. I get to make money from it. What a fucking beautiful thing.
01:26:37So it's totally changed my perspective investing over the however many years, because when you're an
01:26:43investor, you don't look for where you can put, like, we have a portfolio of like, let's see. So
01:26:49in contrarian thinking capital, we have like 33, 36 companies. Inside of there, it's a crazy thing.
01:26:56The companies that want the most from us, do you think those are the winners or the losers?
01:27:00Losers. Those are the losers. The ones I have to work hardest on in there are really typically the
01:27:05ones that are going to give me the least money. The winners, I'm like, cool, just saw that you did
01:27:10another 100 million and they're like, not responding. You know, that is-
01:27:14Busy running the business.
01:27:15100%. And so, and you think about that with your top employees, like the A players in your business,
01:27:22sadly, the worst leaders are bad leaders because they spend all their time with the losers.
01:27:28Yeah. As opposed to, hey, you're a stud. What else do you need? Let me get out of your way. Like,
01:27:33that's what I think a real leader does increasingly is like, let's get out of the way of the winners
01:27:37and stop spending all our time on the losers and get more winners on board.
01:27:42But that's probably not that profitable or popular either.
01:27:46Yeah. The gifted and talented program for the people inside of your organization,
01:27:50as opposed to raising up the bottom percentage is usually not where people apply their attention.
01:27:56What would you, let's say there's somebody listening who is ready to relinquish some of that control
01:28:02and is ready to go from being owned to owning? What would you leave them with?
01:28:07Well, I would start with like, there's one hire I would highly consider, which is like,
01:28:14who is going to be your right hand in business? Do you have a number two that you trust? Because I
01:28:19think it's really hard in the beginning to just implement a ton of systems, etc. Typically, if you're
01:28:24the founder, you're the visionary. You're the one with the crazy ideas. Your execution is probably not as
01:28:30good as it needs to be for most people who aren't running multimillion dollar businesses. If you don't
01:28:35have a number two, if you don't have an assistant, you are one. I mean, one of my mentors, Bill Perkins,
01:28:40who you know, too, he famously told me when I wanted him to invest in one of our companies,
01:28:44he wouldn't do it unless I had not one, but two assistants. And I said, that's the most elitist
01:28:48shit I've ever heard in my life, Bill. And he was like, I don't give you my millions so that you can
01:28:54go do minimum wage work. So like, no, you need to have junior people. And again, it's like, do you want
01:29:01to, do you want to sound right? Or do you want to win? Do you want to be right? Or do you want to win?
01:29:06And so I think that would be the first thing. And then maybe the only other thing is a chief of staff,
01:29:12one of the most underrated hires out there for anybody who's making seven figures plus. If you
01:29:18don't have a chief of staff, I highly recommend it. You're going to train a number two. They're not much
01:29:23more expensive than an assistant. And, you know, ours, his name is Azad. He's a stud. And we actually,
01:29:30Chris worked with him in Iraq. He was his interpreter. When Chris, my husband, was in the military,
01:29:36he was a Navy SEAL in Iraq. And he, during the pullout of Iraq, Azads occurred. And so they were
01:29:46prosecuted. And so Chris had to call in a bunch of favors to get Azad out of the country. And we got
01:29:52him here. The guy went and immediately upon coming in, went and worked at Starbucks and the grocery
01:30:00store, uh, two jobs at the same time to just like pay rent. The second he got his green card,
01:30:05he went and applied for the Marines, joined the Marines, like first in his class,
01:30:10total stud, then goes and, uh, becomes an electrical engineer and was going to go work at Amex for an
01:30:15internship, uh, program. And we pulled him to be our chief of staff. He didn't have any of the background.
01:30:22He didn't have any of the knowledge of it, but I knew I was going to hire him because I remember
01:30:26we just got breakfast with him and I was talking to Chris about it. My husband, I'm like, I think
01:30:30we should hire Azad. Like, he's just a killer. He wants it. He's so hungry. He has none of the
01:30:35experience, but I think he's going to grind and we can help him be really successful. And so I called,
01:30:40we called Azad and he was like 20 minutes away. And Chris just says, Hey, can you come to the house?
01:30:45And he's like, yes, he had just left us. Any normal person would have been like, why,
01:30:49what? He comes to the house and we offer him. And I don't even get out like what the pay is and
01:30:55whatever. And he's like, yeah, I'll take it. And I was like, this guy's going to win. And I think all
01:31:00around you, you don't even realize it, but there's like some young gun or there's some hungry person,
01:31:05age unrelated, who would kill to just be next to the owner, to just be next to one of the winners at
01:31:12the company. And you don't have to pay that much, but then the second they start outperforming,
01:31:17you start paying them more. And those people, almost every time for me, I've become the people
01:31:22who have run my companies eventually. So I could see Azad doing that one day too.
01:31:25Unreal. Cody Sanchez, ladies and gentlemen. Cody, you rule. Where should people go?
01:31:29Uh, ownerbook.com. We have a, this is kind of cool. We're doing something a little crazy we've never
01:31:35done before. Uh, ownerbook.com. We're doing a massive giveaway. And the idea was
01:31:43I don't know, you want to get your book in everybody's hands, but then it becomes about
01:31:46how many books you've sold, you know, as the author. And that's cool. But I was like,
01:31:51what if we could give away a million dollars in cash and prizes live at the book launch?
01:31:56So we could say people made money like right now, today on here. And so we're doing that. So we're
01:32:02going to try to like Oprah Winfrey, a bunch of business grants to business owners. We're going to
01:32:07give a bunch of cool prizes, actually, uh, while we're there, things to help people with their
01:32:12productivity. And we're going to try to help a bunch of business owners actually make some money
01:32:16live during the book launch, which I don't think there's ever been a million dollar book launch
01:32:20before. So that's kind of fun. And then, um, we're partnering up with all these charities.
01:32:25And so, uh, you might like the Navy SEAL foundation. So some of these charities will like
01:32:31live have videos and access to things that they wouldn't because of everybody coming and buying
01:32:36books. So anyway, could totally implode, but it's going to be really fun to try.
01:32:39Unreal. I'm going to watch either the fireworks or dumpster fire, depending on what direction it
01:32:43goes in. You're great. I appreciate you so much. Thanks for having me.
01:32:46All right. Goodbye, my beauties. Dude. Yes. This was great. Congratulations.
01:32:52You made it to the end of a podcast episode without dying. Now here's another one. Go on, watch it.
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