Practical Ways To Grow Your Business | Ep 821
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If we can't clearly state our goal, we certainly won't hit it, right? You're not gonna hit it by accident, for sure. So I'm wondering, like, you know, yesterday when we looked at the van, like... Sure.

Can the business model itself be a detractor? Like if I'm trying to think of how big can we grow this in the current model before we have to look at SaaS or products or people become, you know, obviously a big issue in this type of business. So how big can this go in this type of model? - Yeah, I think it can, I mean, it can't, it's very unlikely it becomes a billion dollar a year sales business.

The biggest problem with it, so the two big problems of that business are revenue retention, number one, and number two, depending on the model, if you have like coaches. Because coaching doesn't scale. I mean, you can get to whatever, 20, 30 million a year, but it kind of like, it becomes very difficult typically after that because getting somebody to be as good as you, this is actually what I made my whole podcast on this morning. So like,

So if we scale, let's just say a one-on-one business as a most rudimentary version of this. You can then go down to one on four, one on eight, one on, you know, one to infinity, right? So you scale that way, basically more and more fractionalized access to you or your knowledge, whatever. This way we have other people

other people, right? More other people. Where you still have one-on-one, but it's other people who are doing this. And so here you templatize fractional, like break apart the pieces into constituent parts, and then you train people on the smaller pieces that they can replicate in theory. In practice, I think what ends up happening is that, let's say I have a glass of milk.

If I say, hey, we're gonna go to one on four, one on eight, I pour that glass of milk into a shot glass and I say, do you still want it? Now, if the milk's amazing, they're still gonna take the shot glass. The alternative here is where I have that glass of milk and I have an equal size glass of milk, but I pour a little bit of milk in there and then I just pour a lot of water in. And I said, you want this really diluted glass of milk, but it's the same amount as what you had before. And so I found that I think more businesses do a better shot going this way than going this way.

Now the third path is what I think is the best version of this. And so if you think about knowledge businesses, there's tons of massive knowledge businesses. So Ernst & Young, McKinsey, Bain, all started by people who put their name on the building, right? Accounting firms, law firms, consulting, all of those fundamentally have the same thing. There was a guy who was really smart and really good at some stuff and was able to get people to give him money. The difference is that these models are predicated on

basically a career path, so they are supply constrained. And so the problem with most coaching businesses is that like, hey, you have a pulse and in seven days I'm going to get you to, you know, give you a roster of clients so I can keep selling them. But the problem is that if you can teach somebody in seven days how to teach somebody else, either you didn't teach them fully what you do or what you do is so simple that it's not valuable.

more often than not, it's the first thing, which is like I taught you 10% of what I know, but I'm still gonna charge more or less the same price

either way and then that's what creates this turn factory. And so the reason all of those companies have our supply constraint is that finding really intelligent people and then they have a career path where it will take them 10 years to get to partner or whatever managing director status and they start as analysts, then become senior analysts, then become VPs, then become principals and they work up the ladder but they have huge earning potential. So somebody who is intelligent and hardworking and could actually do a job as good or better than you,

doesn't want to work as a coach. So there are people like, Neil's not here for this one, like there are people who are very, like you guys are on my team, like they're very intelligent people, but they don't want to be, they're not coaches, right? And they're very siloed experts for these particular things. And so this is actually many to one. So instead of one on one, it's many people who are experts for one customer.

And so I see these as the three kind of delivery models that evolve over time, pros and cons. This one just doesn't, scales quickly but then it stops because churn becomes too big. This one is much slower because it's supply constrained. But if you get really smart people, you can build a really big firm, which is evidenced by all the massive firms. This one, you have models like Tony Robbins, who, Tony Robbins, even if you're on a, there's 10,000 other people watching, it's still valuable. To zoom back into,

To your question, I would probably be thinking of a, is the goal to sell? The goal is for the company to be around after I die. Okay. But I don't want to sell it. Well, the, but you do want to sell it. I mean, I don't have the immediate desire to sell it. Sure, okay, got it. You want to be enduring. I got it. So then the only thing that I'm solving for is revenue retention.

That's really it. It's just revenue retention. And so, obviously the hair solution we were talking about earlier, like if there were products that became the core business, then that becomes a very interesting model. The problem with that for gym launch specifically is that people were able, like gyms who use our process sell their services for so much more than they make on product. And so that was the issue. And so it was just like always a bolt on. And so if they got distracted, they would just keep selling services, which I didn't make anything on.

with the hair business, they make so much more on hair than they do on their cut and color, whatever, like small services, that they immediately just start switching to selling hair. And so it becomes the core economic engine of the business, and that's what creates the revenue retention for them, but not as much for supplements, for example. And so for your business, it's either figuring out is there hair that they can sell that they won't stop selling, which means it has to be the core business, which I feel like is tough because almost all your people are practitioners given what you just said,

Or I have to give some sort of tool that they all have to use on a regular basis, which would be SaaS or some sort of hardware that helps them make better assessments that then they can charge more or whatever the hell. - So it almost becomes like build the Kindle but get them on Prime type of thing. - Oh, that's 100% the model. And so like gymowners.com is what Gym Launch is going to become or already is in the process of transitioning into.

And that's, in my opinion, the only way to transition those things into one. We don't do it to build enterprise value, we do it to retain customers, which then creates enterprise value. - Cool, that's fine. - Yeah, and it's also really hard. - Yeah, so I've got a motorcycle YouTube channel. - Cool.

2.3 million subscribers. Top line is 3.7. Sweet. Most of my money comes from ad revenue. Interesting. And we sell a couple hundred thousand dollars comes from products. I'm just wanting to know, I feel like I'm leaving something on the table, something big. Are you doing a lot of sponsorships in addition to ad revenue? Like it's not just YouTube ad revenue. It's most of it's YouTube ad revenue. We just started ramping up sponsorships. That's amazing. That's crazy. What's your, what are your RPMs?

- 30. - Interesting. Oh, then you get a ton of, you just get a crazy amount of views. How many views do you get a month? - 10 to 15 million long form. - Something doesn't add up there. - The automotive gets pretty good, I see RPMs. - Well yeah, but like I'm just doing the math there. So if it's like 10 million views a month,

- Time, so that's meal, so that's 10,000 times 30. I guess, no, that's right. It's long form. - Long form. - Oh, got it, okay, that makes sense. Got it, got it, got it, okay, cool. So, super cool, that's great. So, that's the main ad revenue. What are the people on your channel selling? What do the advertisers who advertise on your channel sell to your customers? - I don't know. - Okay, so, literally, today, in five seconds,

make a community post and say, "Hey, what are the ads that you see on my channel? "Comment below." And you will get, because fundamentally, the people who are advertising on your channel are the ones who are getting the highest return. They're the ones who are paying you $3.5 million a year, not YouTube. And so it's like, if it's worth $3.5 million to them, then it's gotta be, sorry, if they're willing to pay me $3.5, they're probably making at least 10, probably 20 off of that. Now, you would be able to get even more than that because they trust you rather than just some random

a slice, and so then I would look at the product mix of what things are being sold, and I'd look at which of these ones is one that either you could go directly to them and say, hey, I know you're advertising on my channel, why don't we figure a little deal out here? So you've got, you can have products that you own, you can have sponsorships, or you can just run an affiliate, which is similar to these, but just kind of different in terms of the characteristics. So, oh shoot, and then partnerships.

So if somebody has a really expensive thing that's very hard to do, like let's say somebody's got, they've figured out how to build mini motorcycles or something, whatever. It's like, I might say, how can we partner on this so that I can push you traffic and promote and endorse and whatever? And then you have some element of cash flow, but a huge chunk of equity of that business. Basically, you would pitch them, this is how I position it. I would say,

And you've got some cash too. So I would, the magic here is putting money and brand behind something. So it's like you have three people in your marketing department. I am the marketing department of a business that's 20 times bigger than yours. And so I'm gonna bring my entire marketing department, it's like a reverse acqui-hire. I'm like letting you acqui-hire me.

but I'll put some cash in the deal too, and let's split this or whatever, and we can go to whatever this next level is. So that would be like, this would be maybe the most complex, but the biggest bet for you that you could get like crazy returns. These things are all, I would say, smaller bets. Like if you're not spelling sponsorships, you probably should. Just from a media company. So it's like, do you want to optimize for how much profit you make? Because you could just become, if you're just motorcycle media,

then you just sell ad space. So not only do you get ad revenue, you just also sell ad space. And I'm guessing you could probably do, probably double the revenue that you have right now, maybe more, just by selling ad space. And that would just all drop to the bottom line. That would be it. But the first step of still getting who are all the people advertising is a great first, like that's my leads list of hitting those people up. And the nice thing is it's like really warm reach ads. You're like, you already advertise on my channel. So,

Let's make this official, right? The affiliates is like if they're not willing to trust you, you can get a percentage of the revenue that you send. I'm not as big of a fan. I'd rather you do sponsorships. But if you need to like prove it out early or something, you can do that. And then this last category is just like if you were to develop a product, what would you sell? If that's not your space, then I would rather you just find what's the thing that makes the most money on my channel and then how do I make a deal with them that makes sense? That's probably what I would do.

Because I don't want to go build school. I was like, I'll just bring a bunch of money and then buy it. That made more sense. But I'm not going to start another software company. That's a huge distraction for me. But I have all these people who want to start a business and I should put them somewhere. How are you doing there, Alex? So I just want to go through my main funnel. I'm just using the theory of constraints. So I do organic traffic.

And I have my CTA, which captures 46,000 people. This is for this last quarter, 46,000 people engage with that CTA and it kicks them into an AI conversation. This is physical therapy, right? Yeah, this is chronic pain, head, neck injury. Yeah, just for everybody else. And it's a membership course, $99 a month. Okay. So the 46,000 people, they do the CTA, they go into that automation course,

50% of them engage with the automation and 50% do nothing. All right. Of that 50%, 3% make it to the bottom of the conversation. Okay. And of that 3%, 17% sign up. Okay. And of that 17%, about 40% of them cancel during the free trial. So 60% of them pay. Sure. Seven day free trial. And this is all automated, right? I pay someone like... Sure. It's not you. Yeah. How many sales is that translating into per day?

- Per day? - Per week, whatever. - It's about 25 a week. - 25 a week. - 25 a week, yeah. - Yeah, you just immediately make so much more money if you just got on the phone and sold them something for three grand for a year. - Yeah. - I told you that yesterday too. - So, okay. If keeping that membership-- - I made a whole podcast about that this morning. - Right. - About you. - Just increased the value. - Just about you. - I'll go listen to it. - Yeah, which is like, you're trying to make something scalable rather than trying to make it valuable.

Make it valuable first. And the thing is, is like, when you make something really valuable, the premium price that you can attach with it gives you the resources to then make it scalable. When you try to make something scalable before you make it valuable, you just keep running into these issues where no one wants to buy my thing, but I got it all automated. It's like, yeah, no one cares. You know what I mean? I'm not saying you, but I'm saying in general. Yeah. I think I'm just saying like, you would be able to probably 5X your business if you just get on the, like once people do that 3% level, I would just have them book a call. Talk to one of our experts.

If you do that, you'll make more money. That's the thing. I have a D&D publishing business making Dungeons & Dragons books. Cool. And I've spent a ton of time doing the theory of constraints to the product development. Sure. Where I have a background in IT DevOps, so I've been optimizing that. And I've been realizing that I've been neglecting the rest of the funnel for the whole business. Do you sell on Amazon? Do you sell Shopify? What do you sell? Primarily, I do it right now through Kickstarters.

So, a bunch of crowdfunding campaign, people give you a bunch of money to build this product, you then build that product. So you have a publishing business, basically? Yes. Okay, got it. Yes, and so... Do you have a pen name? Sorry, do I have a... Do you have a pen name? No, it's all under mine. Oh, but like, so you're an author? Yes.

Okay, cool. Yeah, so I've made two books. I'm working on my third. I got a handful of other supplements and stuff. Okay. And so I've done, I don't know, maybe like 30,000 in Facebook ads, miscellaneous other advertising methods, but that's not my skill set and not what I'm good at. So I'm trying to think like as going through the exercises, revenue is definitely my biggest constraint at this point. It's like I've done all the other stuff too much. I've been focused on that. So I can make a better product faster.

but I have need a better way to sell it. Like I need a better way to bring in customers. And so a bunch of the people have had great ideas on things to try, like dipping my toes into TikTok, doing miscellaneous things on my email list. Yeah. TikTok shop is kind of interesting. Yeah. That's what Caleb recommended. So if I, if, if you were in my shoes and you took like a step back to look at the business as a whole, where would you look at trying to apply your resources to really like

build up that revenue as efficiently as possible. Do you have, but all, is all of your revenue comes from Kickstarter or do they go to Amazon afterwards and then it becomes like? I would say 90% of it's coming through Kickstarter and then. On a regular basis? There's a project that launches every year. Well, the first project took about 14 months to get to the second one. But you only have two books. Yes. So I have a third project that I've already done. So you have a launch business, right?

- Right now, yeah. - Okay, so there's like basically no revenue between launches. - Yeah, people can go buy the stuff in between launches on Shopify that I've got set up. And I've been thinking about setting up Amazon. - You should set up Amazon. - Yeah. - We sell 50 times more books on Amazon than Shopify. - Okay, so would the next play to increase-- - I do a million a month in books. - Okay. - Oh, it's just as silly to me.

Silly, ridiculous. The books are free. - So setting up Amazon-- - I'm like, they're free. You don't have to buy them. They're like, we'll buy them. - So setting up Amazon would be like the best revenue boost, ignoring doing any marketing pieces? - Tomorrow, yeah, for sure. - Okay, all right. - 'Cause here's what's really interesting, is that, did you watch my traffic ranking video? I put it out like three videos ago. It's very recent. Anyways, I'll just tell you. - I don't think so. - So what's really interesting is that people don't think about Amazon as a social media or traffic source.

But I think like 13% of customers that, well let's just test this. Watch my theory just flop on this. Did anyone buy my book first? One, two, look at this. Cool, okay that's cool for me. Anyways, okay. So,

people will buy the book and then they'll find me later somewhere and they'll be like, oh, that's the guy that wrote that book that I like. And so Amazon actually gets me customers. There's this whole misnomer that you will have to have an audience in order, you have to have an audience to have a big launch. But if you have a good product, which it sounds like you do, then when you have 10,000 five stars, I buy books. If there's any business book that has 10,000 five stars, I'll just buy it. And so number one is I would do Amazon for sure. Like for sure, it's where 90% of people buy books.

It's like you're not on the biggest platform that people buy and sell books from. Now, you can still do your launches. I still launch through Shopify, so I can still own the customer base and all that stuff. But between, by all means, kick it up there and do it in multiple formats and multiple languages. Right now, I think we have 30 or 40 SKUs from two books. So it's like we have all four formats and we have two books, and then we have them in five languages.

and we have them on 13 platforms. So we have it on Kobo Digital, or Kobo, we have Draft2Digital, we have like, it's kind of funny about publishing, so it's fresh on my mind. Ingram, if you've heard of that, Spark, if you Google it, it'll come up. And so all that to say, I think you just need to, like the first thing I would do this quarter is maximize all distribution of the books on all platforms that people buy books on. The first thing.

The second thing I would do was try and expand my audience. Like right now, like let's just use all of the distribution that already exists. Let's do that first. And then you can do, you know, TikTok strategy or whatever you want to do to basically market any other product that this works. Now, long-term, once you get your third book out, it actually unlocks a bunch of stuff because you will be able to be profitable with ads because you go to sell bundles.

And you can sell three books at a time. And you can sell really three, but it's like six books because you're gonna do audio and audio, digital, and hardback times three is nine books.

And so you can get away with basically a $99 or 125 or 149 in terms of price tag and you'll be able to arbitrage the traffic that way. - Okay, yeah, you would never buy one of these as like a audio book because it would be, I mean essentially you're using this as like-- - Oh, got it, understood. - To build your character and stuff like that. But I think the platform could still make sense then for doing-- - I'll say this. - Yeah. - You would be surprised.

I would be very surprised. Yeah, but like you'd be surprised. My workbooks are audio, but they're workbooks. So people buy them on audio. I don't know if I've ever seen anyone try that, but that doesn't mean it couldn't be done. People listen, like listening is a very different experience. And a lot of times people are like, okay, just having the background.

Because what's interesting, like I get a lot of people who tell me like, oh yeah, I've listened to your book six times. Right. And it's just because like listening, your comprehension is significantly lower than visual because it's a second attention stream. You're doing other stuff too. And so it's like every time they listen to it, they get something else. It's the same book. And so it might, dude, it'll take you a half day to narrate it. Like throw it up. If people hate it, you can take it down. Yeah.

All right. Thanks. Appreciate it. Yeah, you bet. And 50% of, um, it's, it's increased. It used to be 25 and it's a slowly increased. I think not 50. I think it's, it's like maybe like 40% of our sales or audio. I have a hair extension business. We educate the stylist how to make more money and salon owners with hair extensions with the product. I want to know how gym launch was structured because I know that that's how we need to structure our offer. Um, so can you tell me a little bit about that? Yeah. I mean, uh,

I think I've talked to like three different businesses that do what you do recently. So it's very top of mind. So big picture, the model that seems to work the best is, and it is similar to Jim Launcher Prestige Labs, which is the, we will show you how to

do the thing, right? And then you can also sell our thing once I've taught you how to do the thing. And so the recurring revenue comes from reoccurring revenue in that they continue to buy the hair extensions and then on the front end, it really comes down to like what makes that business very valuable is

proving out what percentage of customers who buy the education become permanent hair sellers. Yeah, 80. 80. And when I say that, so year over year they continue to sell. Right, and so the smart cookie move is to, what are you pricing the front end at? The education? Mm-hmm. Where we're kind of making a new offer, but for under six-figure stylists, it'll be $500 a month. Six-figure stylists,

to salon owner, it'd be 2,000 a month, salon owner, 4K a month. - All right. The reason I ask is that if you have a back end where you probably run, what, 50% margins on the hair or something like that? Is that about right? - 65. - Great. I would even care about the education. The majority of the enterprise value will come from, is the hair side bigger than the info side? - It's 90% of our business. - Oh, is it? Okay, yeah. Well then, I in some ways would almost lower the barrier.

Because if that's the monetization, then the question to solve for is how do we get the absolute most amount of people to sell hair? And so you could think about it as offset CAC.

for the hair business more than its own business in its own right. And don't get me wrong, I'm all for it. If I had to make money or not make money, I'd rather make money, right? But when we're talking about penetration of market share because you're trying to flip people into selling your stuff, then if I could prove that for $300, I could get somebody activated and they actually would sell hair and I would sell 20 times more people and I make $100,000.

all my money on the hair anyways, then I would, it basically, it's almost like creating artificial friction. - Yeah. - I'm not saying go to 300 because they might say yes at 300, 1,000, 2,000, like go to the highest that sells the most without getting into that next tier of losing buyers that you otherwise would have had. - Should they pay for education or just their product spend? So it's just an exchange of value. - It's a good way of doing it. Like we did that with Prestige Labs.

we would have them buy, it's a little bit different because it's consumable, but we would have a salon, for example, or a gym, buy supplements, a stack for each of their trainers. I'm a little high if they can turn this down a little bit.

And so all the trainers at the gym would all go, you know, do a 30-day challenge or whatever. They'd use the products. And then they would be, they would have conviction that it actually worked. And so then it made the sales on the back end so much easier. Like, hey, I just did it. Look at my before and after pictures. Like, this stuff's really good. And so in order to activate them, we had them buy something like $5,000. Ed would probably know, I think around $5,000 for the product. And then he gave them basically the education for free. So you still had that, like, you still have that,

That buy-in? Yeah, you still have that buy-in. And you know what's crazy is that you'll probably, you'll be amazed, you'll be able to sell way more product, well you probably already know this, it's way easier to sell product than it is to sell info. Way easier.

Because you don't have to, like, they get it. Like, everybody here who sells info, like, when you start, if you ever sell, like, physical stuff, you're like, oh, my God. Because we're so used to selling, like, an empty box of air, being like, this is very valuable. But when you actually have something in your hands, it's like, oh, my God, this is so much easier. Like, you can see it. And look, put it on your hair. It's, ah, you know. So, anyways, does that help? Yeah, it does. Thank you so much. Yeah, yeah.

Don't like break your business tomorrow, but like I would experiment with just what allows me to spend the absolute most amount of money to get the most people selling hair. That's the problem to solve. - Hi Alex. - Yes ma'am. - My name's Julia. - Hello Julia. - And I'm an online fitness coach for women over 50. - Cool. - Because I do my job so well. - Over 50? - Yeah. - Oh okay. - Yeah, there's a-- - I would've thought over 30, but okay, that's fine.

Anyway, because women have so much success in my program, after 12 months, 18 months, they're gone. I don't know what to offer them after that, but I also have a huge opportunity to tap a high net worth individual community where instead of paying $1,000 a month for six months or 12 months...

24k to 100k a year. And one of the reasons I came this weekend was to figure out what direction I should go and I got a whole lot of other valuable content that I wasn't expecting, so thank you. But where should I focus my energy? Because really when my clients reach their goal, they're gone. I wouldn't worry about the revenue retention piece for your business.

So this is a really good exercise for anybody. I try and think of what do the biggest people in the space do? What do those businesses look like? And so Weight Watchers, Jenny, I'm not saying you're the same thing, but just in the space of weight loss, which is the space you're in, almost none of them have revenue retention. And so Tinder, for example, I don't know if it was them, but one of them was like, "The point of this app is to get deleted." Not all businesses have to have revenue retention.

But this is where because people get single again and then they come back or they get fat again and come back. So it becomes more reoccurring than recurring in terms of revenue. But I think all of this comes down to or bubbles up to what your goal is. To have an impact and make lots of money. Well, you already have the impact when you're already making lots of money. So it has to be different than that. That's not enough. But anyway. Me neither. Yeah.

I guess my goal is to reach as many people as I can. Well, then make it free. Say again? Then just make it all free. I can't, no. Okay, so then what's the goal? To make money. Okay, fine. So do you want to make money by selling it or do you want to make money by growing the revenue of the business? Growing the revenue, but in a model that I love doing. Well, I was pushing back on the impact whatever thing because I also talk to business owners all day. I'm like, I hear that shit all the time.

Because if that were true, then you wouldn't be like, okay, I want to sell even fewer people at a higher price. I don't care, to be clear. Make money, I'm all for it. If we can't clearly state our goal, we certainly won't hit it. You're not going to hit it by accident, for sure.

So if you just said, hey, Alex, I want to triple the profit of this business, I'd be like, cool. Well, now we can actually pull this apart and take this. Now, you might have your own things around that, but it's just much easier for me. So what's revenue right now? What's bottom line? The top line revenue in the last two years is like $700K. Okay. What's bottom? You know, when we did all that stuff, I was like...

You're good. Can I just say it's not super high? I don't know my numbers. I'll just admit it right now. You're good. That's fine. So you have something that's working, right? So people are paying you $1,000 a month. Okay, so the issue that you have, I'm guessing, is marketing. Market. No, advertising. You're not, like, not enough people know you exist. Yeah, that's definitely a constraint. Right. So I certainly would not advise you to do anything new right now.

I think you need to sell more. Can you handle more customers? Yeah. Okay. Then I would be trying to sell more. And sell more at what's making money now or to focus also on that? Do you have decent margins on what you sell now? No, absolutely. I have zero ad spend. I don't have any employees. I do have consultants that I pay. Yeah. So you actually have the classic small influencer issue, which is...

Anybody who's organic typically wants to create many products because they only have one base of customers. And so the only way they can think to make more money is to sell them something else. But it's, you should really just see your organic audience as the jumpstart to then continuing to sell to colder and colder traffic.

Because otherwise you start five businesses and every single person here has probably seen the influence that it has. Five different revenue streams. They all add up to in total a million dollars a year. But they're like, you know what I should do? Add a sixth. And so this will be different, right? So it's just that you only know one way to advertise. And so you're looking at all these things that need to change about my business, but you just need to advertise more. Okay, good. Yeah, that's honest. Like I wouldn't add any complexity to the business that you already have.

Now, if you want to add an anchor product that's 100 grand, I'm all for adding super high anchors. Why not? So when you add an anchor, by the way, the way this works, so I learned this technique when I went to a suit shop.

and I was poor, and I was told that I needed a nice suit. And so I went there and I said, "I'm gonna pay $500, that's my max, "for getting a suit." And I go in, and a friend of mine set up the connection. So he's like, "This guy is awesome, blah, blah, blah, blah." So I get there, and he does my measurements, and he lines up this big rack of suits. And so he puts the first one on, and I was like, "Man, I feel like a boss." And he's like, "So you like that one?" I was like, "Yeah." And so I look at the tag, and it says $16,000. And I was like,

oh, I like my, the blood just drained from my face. And I was like, this is a car. And so I was like, ah,

And he saw that I shit my pants in his nice new pants that I was wearing. And he said, do you care about the brand? And I was like, no, don't care about the brand. And he was like, I got you, sport. He took one off and put another one on me in one move. And at this one, I didn't even look in the mirror. I just looked at the tags. And it was two grand. And I was like, OK, I can...

I can swing this, at least I'm not gonna, you know. 'Cause my friend made the intro, I didn't wanna be an idiot. Which now I would give zero fucks about. But anyways, and so I ended up spending like $500 on like socks and handkerchiefs at this place and I walked out spending $2,500. And only after I walked out did I realize that I spent five times what my budgeted amount was. And this guy was a fourth generation tailor. He knew exactly what he was doing. Because he had the one that was one eighth the price already there.

And so when you have an anchor upsell, the way you want to do it is there's something called primary and secondary features. And so the primary feature of the suit for me is to look cool. The secondary features of the suit would be what's the material, what's the brand, like all of those things. And so what you do is you have your anchor at 25,000, 50,000, whatever you want. And then you get the gasp and people shit themselves.

And one out of 10 people are like, awesome, that sounds great. And you're like, holy shit, this guy just spent 50 grand on this. And he probably would have been like, holy shit, this kid just spent 16 grand. I was like 24. Of course I didn't have 16 grand, right? But he still put it on me. The secondary features are the things that are not material to most people. So that what you can do is basically deliver 90% of the same product

for one tenth the price. And then people were like, "This is, I'm pulling one on this guy. "He doesn't know that he sold me a suit "that's almost the same as his $100,000 suit." And you're like, "This guy is about to buy a $5,000 suit "that's really a $500 suit, "'cause I showed him a $100,000 one first." And so you just change the things that aren't material to most people, and you wanna come to the rescue. It's like, "Hey, do you care if you have my cell phone, "or are you good just with Slack?" It's like, "Oh, Slack's fine, yeah." It's like, "Okay, cool, well then, "we can still pretty much get you there, "vacation, plane flight, just slightly differently."

so i think if you if you add the anchor upsell in and then all of the cash that you get from the few people who take that pour it all into advertising perfect thank you so much real quick guys i have a special special gift for you for being loyal listeners of the podcast

Layla and I spent probably an entire quarter putting together our scaling roadmap. It's breaking scaling into 10 stages and across all eight functions of the business. So you've got marketing, you've got sales, you've got product, you've got customer success, you've got IT, you've got recruiting, you've got HR, you've got finance. And we show the problems that emerge at every level of scale

and how to graduate to the next level. It's all free and you can get it personalized to you. So it's about 30-ish pages for each of the stages. Once you answer the questions, it will tell you exactly where you're at and what you need to do to grow. It's about 14 hours of stuff, but it's narrowed down so that you only have to watch the part that's relevant to you, which will probably be about 90 minutes. And so if that's at all interesting, you can go to acquisition.com/roadmap, R-O-A-D, roadmap.