BE V2.0 — Session 16

Jay Abraham · 2021-05-10 · 1 h 18 min · the recording

Transcribed by machine from the recording. Names and a few spellings may be imperfect; the timestamps mark where each passage begins in the recording.

0:00:04Good morning, Monday people. All right, I see a few people filtering in the room and their Zoom has opened the doors and we are up and running with at least half of everyone. So good morning, good morning, good morning. Happy Monday, thank goodness it's Monday. Today we're gonna get into taking your business beyond exponential. And what to do when it comes time to transition into something new. So we're gonna talk about exit strategies and how to transition into whatever is next. And again, like Stephen Ark Covey, I believe it was, who said, begin with the end in mind, can always be a great way to build your business to the point where you can exit. So no matter where you are in your business process, today's presentation will be adding value to how you think about your business and hopefully give you a few insights that you can use to grow your business beyond exponential. So yeah, TGIM, let me make sure there's no big questions here starting off. Next week, Scott and I are gonna try something new. We're gonna maybe make a clubhouse fan, Jay fan club, and we're gonna go over one of the podcasts that relate to beyond exponential categories.

0:01:39We're gonna open up the Zoom and maybe co-broadcast. So if you don't have clubhouse, you don't need to worry about it next week. But we may try a different platform for a little while during these reviews, but we wanna try some new things to generate different kinds of connection and maybe expand the value so that we're showcasing your expertise along with Jay's because you have grown so much as a contributor of audience. The way that you show up is so vastly different than the status quo pro out there that believes in armchair cordobracking. You have run the ball down the field. So like Jay's gonna start this off with a little kind of clinical statement that most people fade with every kind of course. And look at you, Jay's not promised to show up today other than the presentation that we're gonna be streaming to you. And here you are ready to get value with your notepads, but more than that, you are applying these principles and ideas to your business to grow them. And it's that application that differentiates you from the field. We are also exploring some different ways to get you engaged. Unfortunately, we don't have anything locked down yet on either the date of the live event or the next iteration of this.

0:03:14But we wanna keep you engaged in the meantime in some way, shape, form or possibility. So we're gonna either be doing this kind of thing on a kind of a clubhouse style where we're conversing about these concepts or something else. But we'll also be sending out kind of a more comprehensive conclusion email that's gonna have kind of the categories. So if there's anyone that you wanna review or highlight, you can go over it. I encourage all of you, I know that you've been talking to keep engaging with each other, maybe kind of carve out sometimes and think about how you can do that. But keep your eye out for whatever that next rendition is. And behind the scenes, I will continue to advocate for you to get you deeper and deeper engagement insights and depth to these categories that Jay's gone over that work, they've been tested, as private clients have proven these systems work. And sometimes by him kind of articulating what he does, how he does it, he comes up with a new kind of shift like he did with the prisms of profit to kind of think about how you look at things, can generate profit. So we will continue to look for those kind of opportunities. Let's see here.

0:04:48So there is a hoop. I see you have a question. What can I answer for you? Oh, and I'll answer. Hey everybody. Hey, hoop. Hey, good morning. Can you hear me? I can hear you just fine. Standard question, everyone that comes on asks, can you hear me? And the answer's always yes, right? So that's interesting. You know, if you asked me two days ago, it wouldn't be. I got my second shot. So it took me out for a little while. Oh, really? Yeah. But you're now all safe, right? You're all vaccinated. Hey, there it is. Hey, that's cool. You guys have been so quick with this whole operation. In Holland, we're still waiting for our first shot. And Holland is a lot smaller, I can tell you. It'll come. It'll come. Yeah. So I wanted to, I wanted to, because we are always talking, thank God it's Monday here, right? And I just finished my application that I send in with a video for Jay, because he had an outreach for people to help him with all kinds of things. And I've offered my help in getting his work out in more comprehensible formats, right? Like small books or things like that. And I have written 10 books in the last 20 years. So I've offered my help.

0:06:21And one of the books I've written, actually the title is, thank God it's Monday. So I wanted to share that here in the notes with everybody, in the chat. Could you put a link in there? So yeah, so that you can download it. I'll put it in right now, because that's funny, because we've been talking about this all the time, right here, every Monday. And I'm quite excited, because I would love to help Jay with this, because I can really see that, I mean, in this program from being in this program from August, I've really immersed myself into his content. But before that, I had like 10 years or something that I was following him. And it could be somewhat frustrating every now and then, because it's so much, right? So like drinking from a fire hose, right? So like many times. Was this so I can really need the need for this, for him to do this, to reach out to more people, to get more impact. So that's, yeah, I'm excited. I hope I can help. Quick clarification though, Hoop. On this program, it was our goal to take the fire hose and turn it into an elephant, and then cut it into bite-sized pieces. Where it was successful in making the massive content that is Jay Abraham, a little bit, I know that even though we put it in bite-sized pieces,

0:07:47it still feels like Niagara Falls when it comes at you. But did you feel that you got more from this program than kind of the way that you've gotten it before? Well, actually, Brian, I have to tell you, I went literally from 1 million revenue in 2020 to 5 million in 2021 and possibly even to 10 million. So that is mainly because of the huge mind shift I made. And I've taken so much more out of all the opportunities that have been around me for years, but I just wasn't able, like in partnerships, in getting everything I have, out of everything I can, out of everything I have. And so, I mean, I'm really, yeah, I'm the classic example of really working and implementing the stuff. And, yeah, it's amazing. It's amazing. So I would love to share this with as many people as possible, because also sometimes when I tell my friends about Jay and they want to see, I'll send them a link from a YouTube video or something, I know that it's just too much, you know? Look at an average Jay video and you'll just be totally confused after an hour and you think what the hell was that all about? So you really need to emerge yourself in it, and now I can put everything into order and I can really benefit from it. But that really took me some time.

0:09:23So, yeah, so that's something I think that can really be helpful when we put it into practical small little bytes and there's 100 books possibly in Jay's work, right? Oh, yeah. Oh, yeah. And maybe that's a good idea. I understand that Ben Sullivan, he writes a book every quarter and he's working on his 25th book now, so it can be done. I'm going to see what I can do a little bit behind the scenes here, because you've given me an idea. And the experience that I had before this program, working with Jay, is that I would always get new insights every time I heard him. Yeah. But they were so inspiring that my brain would just latch on to one idea and I'd be in fantasy land for thinking about how this could apply to me, my life, what I want to do and how I want to do it. And how could I apply this? That I'm missing out on major insights. And because I... It's not a problem to listen to the same video all the time, right? You get this idea. Exactly. All the time. So, I've heard this concept of beyond exponential three times. We've done three different versions of this. And I now am a firm believer that preeminence is the most powerful concept in all of this.

0:11:00And it's the biggest money maker. And because I didn't understand it at first, I only got the tip of the iceberg. But now I understand the water around the iceberg and why it's cold. So, there's an environmental impact that most people are just focused on the iceberg. The iceberg really doesn't matter that much. I mean, you have to become the iceberg, but it's what you do to the market that surrounds you. You know, you have this cooling effect on the water that changes weather patterns all around the globe. So, when you're truly preeminent, it's how you impact your environment, that transforms and makes it so the current flows to you and through you instead of around you and avoids you. So, it's this amazing kind of differential factor. You know, it's like sometimes you see a tree, but you don't see the shadow. And it's the shadow that makes the art amazing. You know, so it's kind of like, you know, that's the thing that as an educator or as an advocate or, I mean, Jay struggles with. It's like, how do you get people to see not only the tree, but the shadow, not only the branches, but the roots, not only the iceberg, but the ocean. And it's one of those in Zen, it's like, I can take you to the edge of the cliff,

0:12:33but you're going to have to make the leap to get over to the other side of the chasm. You know, words can only take you so far. At some point, we all need to do with this inner work, where we digest and find the way to use the energy of the message in our own lives. And I think that this program, because each and every one of you, I mean, how many people have been in programs where people continue after the quote unquote official end? I mean, look at this. Some of you, this is your second review of the entire program. And you're kind of staying on for extra credit. And, you know, I mean, today's topic is totally worth it. Get exit strategies. This is one of the best. So you've all tuned in for an incredible episode. But look at the commitment at who you are and how you're showing up. This is, you know, this is what makes people uncommon. And this is why I think that this program is unique is because truly every single one of you are a leader because of what you're doing and how you're showing up today. I mean, if you are listening to this live, the person that is listening to this live is a leader because they are committed to something to to their clients, to being preeminent, to thinking about these things.

0:13:55So powerful. So thanks again, Hube. I appreciate you. And I'm looking forward to the link to that to that book. And I think there was a question here from Maya. We need a book. So let's see. There it is. Thank you. Thank you. And Steven, I agree, volcano, better analogy. We and Maya, we've been talking about beyond exponential as a concept for a while. But we haven't developed as a class until this last year. And then there was another one, I think, earlier before. Look at all these congratulations, Hube. So let's see, scrolling back. Yes, let's stay connected. And it's not the last day. We're still going to do a live event. And we're going to still look for ways to kind of keep this going. And yeah, and on the clubhouse, what I'm thinking of doing is, yeah, if you are in this program, we can bring you up as speakers to get you engaged and kind of contributing in the conversation. As long as you understand that a portion of it is going to be streaming J, because we want to have that kind of thing.

0:15:37So it's going to be a little bit like a radio show where we do an introduction. We stream a little J. We have an interaction that you can be involved in. We stream a little bit more J. We have some interaction. And then we open it up even bigger. So we really digest. And that's when we kind of have our after discussion. But we're going to do a couple of station breaks. So that's not a time to really get involved. But as long as everyone understands that, yes, we can bring people on as quote unquote speakers in clubhouse, which will add value to you and your brand early on. So great suggestion there. Let's see anything else. I think that is most of it. And it's not going to be a full two hours today in terms of the stream. But it is quality content. I may take a break in the middle just to kind of again, have your mind to have that digest moment so that we don't get lost like I do in my own thoughts and fantasies. So I may give a little break in the middle to kind of digest a few of what's going on. And Jay's going to start off with a little bit of a insight about perseverance. And then we're going to get into the exit strategies. And then we will open it up for insights.

0:17:12So glad to hear it. And here we go. Let me do this. Share the screen. Let's do this. And if everyone, when this starts, I just need a couple of people to let me know sound is good, image is good, and that you can't hear me talking over Jay. So let's go ahead and roll this. I apologize. Hopefully if it gets bad, I'll go back to go back to video only. So Brian, tell me that and my hell got it. The saying is it's it's it's not a lament. It's a clinical insight. Most people don't have the wherewithal to go the distance in any endeavor. Sports, weight loss, health improvement, relational improvement, they really don't. The human nature has an instant gratification, instant curative. Yeah, instant curative. We're really we're very illogical beings. We want outcomes, but we're not willing to put in investment into it. So for those of you that are on, I law you, not very many of you, but you'll get private time today if we have time for it. So let's put up. I didn't look at the PowerPoint. I'm sorry. I got diverted yesterday with a really bad problem.

0:18:46I had to solve till late in the evening, which is why I'm a little late today. So I apologize. I had a very tragic business issue I had to deal with in the wee hours overseas and it was very complex in another country. So please forgive me. But let's be got a PowerPoint we're going to look at. I haven't done it for a long time and it's not original. It comes from a colleague, but it's pretty interesting. And some of it I'll bypass because I haven't done it, but I want you to look at it. It's designed frankly for a different audience, but I want to try to torque it down to you because much of its message is super relevant. So Tom O'Neill is a friend. And for many years, he worked helping business owners prepare their businesses for sale to private equity firms. And he got very masterful at explaining and identifying ways to make their e-bita much bigger because oftentimes one of the most relevant factor in the purchase price was e-bita. And he created methodology and he was influenced to some degree by my thinking. So some of this has Jay Abraham written all over it. Some of it doesn't. And he shared with me his PowerPoint. We've been acknowledging him whenever we used it over the years. And I haven't really gotten it out to use in many, many, many certain, maybe not years,

0:20:21but months. But it's really, I think it has at least half relevancy. And let's go through it. And let me try to adapt it to those of you who may not be ever selling your business, but would love obviously to have your profit performance maximized. Okay. So he would look at the anatomy of a business. He'd look at product development. He called it customer, your client acquisition, your lifetime value, and how to maximize it. And he'd look at how you can enhance different strategic things you're doing. Your mode strategy, mode means what's going to defend you, what's going to make your business stand out as differentiated and more advantageous, new processes that will give you performance advantage, economic efficiencies, operational efficiencies, KPI yield improvement. If you don't have KPI's key performance indicators, you don't know how you're doing in any of a number of areas. You know what it's costing you to bring a prospect in. You know how many prospects convert from different sources or different types. You know what the initial first sale worst case is. You know what the residual value is. Do you know what it costs to do this, to do that? Do you know it's relative implication? If you don't, there's no way, if you can't, you can't improve what can't be measured.

0:21:53If you don't know what you're dealing with, wanting improvement is aspirational. It's not achievable, or it's not achievable in a meaningful way because you have nothing to compare it or correlate it against. Next slide. So he was basically the counselor. So you have an exit strategy. And all of you really deserve an exit strategy. If you have a small business, you still deserve the ability to have that business do one of three things. Either get sustainably enough, predictable enough that somebody could buy it, or get sustainable enough and predictable enough that someone could run it for you as you get older or get either higher aspiration or lesser ones. Higher means you want to take the knowledge you gain from me or anybody else and apply it in a bigger world of achievement. You know, the other lower means you're tired and you want to basically stop doing all this or stop a lot of it, but you want the income to continue. The last is really building it so that it will throw off enough cash that if you want to stop it, it's buying you assets. But if it doesn't do any of that, what you have is a job that you can be fired from any time that a better competitor comes along, any time. The one source of revenue you've got stops, it's a very precarious situation.

0:23:30So valuation is not as relevant for you right now, but he's talking about if you, how do you get performance enhancement? You can do it through automation. And this was before all the apps, when he first did this, it was before all before all the apps and everything became really available. So you do it through automation. You can do it through outsourcing. You can do it through better systemization and documentation. You can do it if you have trade secrets you can protect. You can do it if you can acquire or license better performing trade secrets from outside your realm. If somebody else in a non-competitive or related field has better marketing or selling or advertising or cash flow or lead conversion, rather than trying to create yourself, you can go to them and say, hey, can I pay you 5% of sales and just use it for my business? You're not directly competitive and then you can do that and you enhance your return. You can enhance your return by getting more profit per transaction, by getting to buy more, by figuring out more efficient ways to acquire them. Any or all of those next. Okay, let's talk about the concept of control. When you look at things in multiple elements of the business, you can categorize them two

0:24:48ways. Things that are out of your control and things that are within your control. Next slide. So, out of your control, industry factors, what's going on in the industry? Stock market, if that's capital markets, getting money, local economy or the industry economy, regulatory changes, interest rates, you can't control them. You have no control over these. Next, what's within your control? How you grow the business, your balance sheet, how clean it is. The quality of your earnings. Quality means consistency, sustainability. It's not, there's a concept in investing called hot money or whatever it's called where it just comes and goes. The moment there's a better return, investors pull it out and put it somewhere else. You don't want that kind of a buyer. You want a quality buyer that's loyal, buys from you, refers for you and the predictability of earnings. We talked, I don't know if we've gotten to it or already exceeded it in our journey because I have three versions of this going on. But we talked about the five elements of business wealth creation, having predictable current income, predictable future income, windfall income, which is finding opportunities within that you can get big hits. Psychic income and then asset value, creating an asset that has value when you're tired

0:26:11of playing the game or when you want to move up the food chain to a higher sticks. All things being equal to more earnings you have from a broader diversified buyer base, sourcing base, the less risky your business is for you, for your family, for your security of financial and psychic and also for any acquirer. I mean, if you're, all of your business is based on one algorithm changing and everything falls apart, if your business is based on three clients that if you lose one of them, a 30 year income is gone, if your business is based on a special advertising deal you've got with the media that will stop when the advertising person leaves or when any other factor comes, you're in very risky waters, treacherous waters. Next, remember increasing your sales and growth rate and if you remember, increase army, increase your sales and growth rate and you increase the predictability and sustainability of your earnings if you're a strategic thinker rather than a tactical static episodic thinker. Next, you can decide to concentrate or spread your risk. People here's risk you got, people risk your team, expertise, relationships with buyers, talent risk people who are able to do things that you've never really quantified, codified or

0:27:47recognized. So you might have somebody that's so much better at doing something and you take it for granted and if that person leaves the knowledge goes with them, the system goes with them, the ability goes with them and hopefully but possibly the relationships go with them. Market and marketing risk. The market can change, the access to the market can change. Your marketing viability can change. The position you're at today may not be as defendable or as valuable or as compelling or appealing as it will be tomorrow if a different competitor comes in or an alternative way of doing what you're doing or solving the problem or achieving the opportunity you do. Competitive and technology risks. Competition we talked about, but if a technology comes in that gives advantage to somebody else and you aren't aware and you don't at least keep parity your screen. Alternative means risk. I talk about that when we talk about our hypothetical company selling a weight loss supplement. You're competing with every other weight loss supplement on efficacy, on proposition, on marketing skill, on their capital ability because they might be able to buy a first time user and a loss and you can't but you're also competing against portion control food.

0:29:12You're competing against Peloton and every equipment. You're competing against personal trainers and ongoing online group training. You're competing against books and videos. You're competing against diet plans. You're competing against people who sell drinks. What do you want to call it? Not smoothies but whatever they're called. You're competing against people that sell exercise training that you do yourself. You're competing against complacency, progress in Asian, equivocation. If you're not aware of all those competitive threats, you can't win the game you're playing. It's a playbook. Next, you have to beat the market or you shouldn't be in the market period. If you can't beat the market yield, if the market is yielding 8% and your business is making you all have six, you might as well just close the business, take whatever capital you got to throw at the market and get a job because you're not beating it, you're losing next. Either rethink your strategy and make the asset, your business, produce what it should or liquidating, give the resources someone who can't get you a rate of return, you're not getting. Essentially, outsource the capital to an investment fund. Next, it's a very simple concept but how many people actually apply this thinking to their

0:30:47business? That's a quote from Tom who this is his methodology. Very little that I teach is illogical. Most of it is elegantly simple but you've either never acknowledged it or you've never implemented it. I don't know which is worse. Probably acknowledging and sitting on the sidelines and then lamenting. I wish I was more wealthy. I wish I had a bunch of rental homes. I wish I had a big stock market portfolio. I wish I had goodbye Bitcoin. I wish I could buy a second home. I wish I could buy a sports car. Wishing isn't going to do it. Getting innovative, strategic and meaningful sustained action is the only way you could possibly move from where you are to where you want to be peer-reyet. Next, go to the IDN and nutshell, apply the same methodology the professional investors apply to their investments for your enterprise and you'll get the outcome. Look at the way a private equity would look at your business if it was big enough and do what they would do if they owned it or buy it. Next, understand your micro investment portfolio. Your investment and you are the investment and the business and investment within the business. Look at the cost of acquisition you're making versus lifetime value. What is the implied yield?

0:32:21Do you look at yield-based business strategy or are you just looking at static? Most people just are two-dimensional thinkers. People get to this. They look at revenue minus expense equal profit. They don't look at yield. Next, what are some of the most common mistakes entrepreneurs make? Next, they don't know how to pull risk out of their business and instead they put risk into the business. If you think like a proprietor in terms of revenue and expenses that are thinking like a professional in terms of yield, three-dimensional thinking and value creation, you're always going to be on the losing end of outcome. You're never going to get the outcome that you deserve, the outcome you need, and the outcome that is possible. Next, what I already talked about three-dimensional relation between expenses, really the investment you're making and the payout. The third dimension is yield. What are you going to get back not one time but over time, not one time but over time? It's pretty cool. I like that. I make a note to myself. I'm really appreciating what you're doing in the ... While Jay has taken these notes, I wanted to stop right here and capture some of these things that are going on in the chat.

0:34:00When you can see how you can add value over the next three months or year, it can be a very powerful thing. Let's take a second and turn off the fire hose and really reflect and how can you take risk out. I really liked ... Let me quote the right person here. Somebody was talking about NFTs and all these things that are coming in. I apologize if you could restate that. That would be awesome. Let's see here. There you go. Amanda, yeah, there's a lot of things coming online. It's like we're coming out of this pandemic. All the world has a shared experience now. How can we address that commonality in our marketing? We all have something in common with everyone in the world. How will your business lead us out of a pandemic? How can you mitigate the risk of currency changing into non-fungible tokens or cryptocurrency or the evolutions of AI? How will your business lead through these things and add value instead of disappear or not be relevant? How can you become the next Netflix and not the last blockbuster? Think about that for a second.

0:35:33Let's reflect and then we'll start up again. Unfortunately, this is a stream. I don't have a lot of dimensionality on the slides, but what I will do is when we're done with this in the email, I will make sure to send out the slides that were used in this presentation so that you can review all of them. We see if I can rewind a little bit the last slide. This is hard with the rewind thing. You can decide to concentrate or spread your risk. People risk, talent risk, marketing risk, positioning risk, competency and technology risk, alternative means risk. It was one of the slides. You have to be beating the market or you shouldn't be in business. You rethink your strategy or make the asset produce what it should or get out of business. Let's see. I think I went back way too far. Apply the same methodology that your professional investors apply to their investments to your enterprise business and activities. Let's see here. If I can get to the next one. Understand your micro investment. You are the investment and the business. In investment within the business, look at cost acquisition versus the lifetime value. What's the implied yield?

0:37:08Pull the risk out of the business versus put risk into the business. Think like a proprietor in terms of revenues and expenses instead of thinking like a professional in terms of yield. We get into where we are. Too far. All right. Scott, you're totally right. We only need to be incrementally better than those who are out there. If we can get in the habit of incrementally growing and thinking of how can we add value to our exit? One of the key things is let's say you're going to be interviewed by an investor. You have an appointment on your calendar in every quarter. In fact, this is something that you could do with each other is each of you could create a power partner mastermind thing where you become the investor in the other person's business to hold each other accountable and you say, okay, what should I buy your business for this quarter? You review the changes that they've made. What are your future earnings going to be over the next five years? What do you use to justify it? But being able to articulate what adds value to your business can get you focused on the measurements that matter and what gets measured gets improved.

0:38:45So by having an accountability partner on the valuation of your business can be a great way to create kind of an umbrella concept that everyone on your team can understand and get behind. We want to increase our valuation by X percent over the next quarter. This is why we're going to do these three strategic things and we're going to use Dr. Bernard's theory of constraints and we're going to start with this one. When it's finished, we're going to get to the next one. Then when it's finished, we're going to get to the next one so that you are truly just leaps and bounds growing your business. So there you go. So let's get back into this. Let me get into the share screen. Let's do share share, share equipment or advertising. Are you doing it because you like to dissipate your capital? Or are you doing it because theoretically you expect to get a return on that investment that far outpaces the alternative ways you could use that capital? I mean, really, you should never hire anyone if you don't think they'll make you money. If you don't know how they are going to make you money, you shouldn't hire them. If you don't revere and respect the yield you're trying to get on capital, human capital, intellectual capital, relationship capital, then you shouldn't invest it because you are

0:40:20a hedge fund, a human hedge fund investor. Every one of these is a part of your portfolio. If you're not getting the yield you deserve, then your capital is eroding. It is eroding. So think about it. So how do you enhance your return in your business? You make new investments or you maximize the return on existing investments? Next slide. So how do you enhance your return? Because that's a lot easier. You deploy new risk capital, crease your principal, or you find ways to maximize the yield on the cap, or you've already deployed. The first is riskier and cost more. The second costs nothing but yields more. And Brian sent this to Desirate Asquer to print it for me and bind it. Next example, you can add 20 more salespeople. Oh, you can find ways to get more productivity out of the BBM already hired. Next. It's simple to understand intellectually, but putting it into practice in your business takes discipline. It takes operational efficiency. It takes implementation and it takes execution. All of which are, they're incumbent on you to be really a very committed person. If only less than a fourth of the people on, or should be on, are on, and we don't know how many will be on replay, they're probably not disciplined.

0:42:09They're probably not operating to optimize. They're probably not implementing anywhere close to what they have and they could be learning. And if they're not implementing, they're not executing, are they? Next. So latent enterprise value. So I'm going to understand this. So find it in three ways. To find enterprise value by capital reallocation gains, by process improvement gains, and my multiple expansions. It's a little complicated. Let's look at the next slide. So capital reallocation. When you reallocate capital, you measure the relative performance of the current processes. If you have one thing that's not doing well, if you're running ads in three places, in one place is bringing a far less or quality or convertible prospect, but you're putting an equal amount or a superior amount there because of the gross returns it's bringing in gross meaning quantitative, not disgusting, you might want to reallocate your spend. The higher yielding processes should pragmatically get more of your capital. This is very good. Brian had forgotten about this. We haven't done this for a long time. And the lower should get less. It's pretty pragmatic, but it's not followed by many people. Next. The numbers you constantly monitor should be client lifetime value, average order size,

0:43:33frequency profit, these are my three ways. And what it costs you to acquire them in the first place because these all factor in to the yield you are achieving. Go ahead. Next. Remember, higher yielding processes get more capital allocation, lower yielding processes don't unless they have a different strategic purpose and value. When should an entrepreneur start thinking about an exit? We've talked about those things. There's three different ways to do it. Why do you think entrepreneurs are often so unprepared to sell their companies? Well, there's a worst statement because this was designed to be presented to larger companies. I would say you will be traumatized, shocked and horrified to realize that 95% of all businesses never sell because they're not sellable. They don't have systems. They don't have sustainability, predictability, defendability, advantage, differentiation, a horizon that can be validated and verified. They don't have any advantage. And most people don't have anything there to sell because they are the business. So you got three options. Create the business to sell. Create the business that somebody else can run it for you. You can get the arbitrage on the earnings. Create the business to underutilize its profits so you can invest it in assets that will work

0:45:04for you. Passive assets, real estate, stock market, active assets, businesses you buy, people you fund, things like that. Next, what about the existing advisors business? Aren't they helping their clients prepare for exit? Are you? I mean, I'm trying to do that. I guess I'm your advisor, but is your accountant trying to help you? Does he or she even think this way? Does your banker try to help you? Does your credit card company try to help you? I was very surprised. We offered a credit card service that was designed to provide no-cost advice to people to grow their business. We got such a feeble response because everyone was more worried about saving a half a percent. And I was fascinated. I don't care. I try stuff. I mean, I just find it an indictment on the short-sighted thinking of the typical business owner who is not really an entrepreneur because an entrepreneur has a totally different definition. An entrepreneur is somebody who understands yield. An entrepreneur understands building an asset. An entrepreneur understands value creation, understands competitive distinction differentiation. An entrepreneur understands how to create an experience for his market or hers. A proprietor just basically sucks economic oxygen out of an existing market.

0:46:39How can entrepreneurs learn more about how to employ this was an opportunity to bring him in to deal? So I don't know the death's relevant. So blind spots are inevitable. You can't analyze your own backswing. You build a board of advisors from outside your normal circle to keep you thinking fresh. Everybody can build a board of advisors. You can do it complimentary. You can do it giving them compensation. You can give them profit shares. You can give them free goods. You can take them on vacation when vacation is doable or on some kind of excursion. You can get people who have pieces of the puzzle and thought experience perspective, expertise you don't to counsel you. Unless you've lived a very full and vastly expansive business life, you probably aren't really as prepared to deal with the dynamics going on, particularly today with all the shifts and all the uncertainties and all the differences. Hold on one second. I might get rid of this dinger and hopefully, but I do not disturb on. Sorry about that. So consider that. It doesn't have to be part of it. I mean, we have services we're going to get ready to offer, I think, a board of advisory service that could be very interesting for people. But for you, you can get people in your community, get people in your industry,

0:48:15get vastly diverse people. But don't think, don't be. Why would you want to be an island? Why would you want to impute in yourself omnipotence that you have the wherewithal to transcend all the issues, all the challenges, the ability to harvest and mine all the opportunities yourself, given your limited experiences in the expanse of the world? You don't have to. You might want to because you want to be an island and you're you're a defiantly independent person, but it doesn't really make sense next. So that's the end of this of the Tom slides. Do you want to bring Kamala now or let me unmute myself so that you can hear me? A short but powerful deck. So let's see. Oh, great. So people are still answering my question. I love it. Looking for a JV partner to add new clients through their existing audience, ideally do this multiple times that one idea. Yeah, that powerful. Thank you, Eric. Take a look and ask questions about what I'm really doing. Very powerful. Map out pro. Yeah. Gia, I think that that mapping out the processes and making it so that someone else can come into your business and continue what you're doing is so important.

0:49:59So standard operating procedures and things like that can be a powerful way. So if someone would like to what. Oh, oh, so Amanda. The question is, let's say an investor is coming into your business. They have an appointment at the beginning of next quarter and they want to make an offer to buy your business. What could you do in this quarter coming up before that meeting that could add value to the multiple that they are going to be offering? Because it's always nice to be able to say, hey, our business was valued for X number of dollars. And it's a good thing to kind of be aware. And it's also a great conversational piece to get your team, your vendors, everyone kind of on the same page. So even if it's a mock interview of like a buyer review, like let's say one of you partners up with another one of you to do kind of a review of each other's businesses in one quarters time. It can be a great way to get people on the same page to look into the question of how can we create more yield? How can we mitigate more risk? How can we better plan for shifts in the market and the world? What does a post-pandemic world look like?

0:51:35How can we be a better leader? How can we better articulate what's needed by our clients? Now that there's been some subtle shifts to human interaction, do our products need to be packaged differently? Is our marketing empathetic to what people are going through? Those kind of questions can come out of masterminds thinking about when you're selling the business. And just finding out what it's worth can be a great way to find the dimensions and the measurable things that you can look at so that you can improve upon those things and what gets measured often improves. So if someone would like to kind of talk about that process, please raise your hand. And if someone has an answer or an insight based on some of the conversation that's been happening in the chat, please raise your hand as well. Alright, Jeff, let's bring you on. So Jeff, you should be able to unmute yourself. Oops. Jeff, I don't hear you. I see your face. That means you're probably talking, but I still don't hear you yet. There.

0:53:08Yep. Yep. There it is. Well, yeah, great. Technology is a blessing. Terrific. Thank you so much, Brian. Really, really fabulous content. And I think, at least from my experience that I work with a lot of businesses and have for many years in these kinds of transitions. And I think you said it and summed it up really well in quoting Stephen Covey, which is begin with the end in mind that the most important thing in exiting a business or is at the even at the very beginning of establishing a business saying who would be a potential buyer? And is it a strategic buyer? Is it a roll up? Is it someone who wants to expand an operation? And that kind of mindset is Jay is talking about really is expansive and you really want it to be a turn key operation for someone when they buy you that they're getting immediate value. So I mean, this really sums it up and accentuates it beautifully. Thank you. And thanks. I'll pass on the thank you to Jay as well. You actually got me to think about something, even if it's not the beginning of your business, getting into that mindset of if I were starting this all over, what shifts would I make? And one of the questions is, how are you structured as a business?

0:54:42So Jeff, are you a C corp, a S corp or an LLC? I'm an LLC. Okay. Is that the best structure for your business? Have you have you thought about that in the last several years? Continuously. Okay. So there may be another option. Now, what what business do you think someone else would prefer to step into? And since we're talking about ways to creatively buy a business in the advanced three ways to grow a business, what is an interesting way that you could begin to sell your business right now while maintaining the profit share, mitigating some of your risk and doing some other things? You know, would a is your business more designed towards a solopreneur or a structure? If it's more towards a structure than maybe moving to a C corp might be something to step into, but if it's a solopreneur kind of operation where one person being the entrepreneur of record makes sense, then maybe finding a way to maximize their income and reduce their costs in an S corp might be more attractive to them. And the ability to sell a potential buyer a share to test drive controlling the business to a small degree might be a way to ease them into a business so that you can actually begin to put in a transition strategy right now.

0:56:21That is right on that. I think it's critical and Robert Chan is shared before as he's looking to buy businesses, what we want to keep in mind as we structure our business or look at other businesses is what is it that someone would want to buy? Do they want a list of names? Do they want existing relationships? Do they want data? Do they want processes? Do they want some unique positioning or intellectual capital or patents? What is it that makes it unique and attractive? In some cases, people would like to buy up quality employees because putting together and assembling a team today is such a challenge. So there's so many different ways to approach it and really putting yourselves in the shoes of the buyer who's going to pay the highest price as a buyer, you want to know. And then as a seller, how can you position your business so that it is that a buyer who's going to pay the highest price is going to swoop you up and pay the highest multiple? There it is. I think there's so much value in this back and forth, Jeff. It's always awesome. Yeah, Brian, really awesome. I've enjoyed it too. Great. All right, let's bring on Ina. Hello.

0:57:56Hi, guys. Hi, hi, hi. A lot of thoughts about this. And since I am working on my multipliers, you know, for the exit strategist as I asked my questions last time. Right. But this is my insight because I am going into consulting business as well. And I have so many consultants in every, you know, part of this field. None of the consultants really talking about exit strategies. And this is the most important. I think when you're setting up the business model, you know, you're mapping basically, you know what you're working for with the multiplier and then you can do the structure and operations, you know, and then you can move forward. Because what's happening is that a lot of business consulting companies, they work on operations and operating and tactical growth, you know, and I changed three times my business model when I found out about this multipliers. I'm like, oh, my God, you know, I spent five years on just, you know, increasing my business in an incremental way. So this is very insightful because a couple of days ago, we have applied. There was a federal funds for $1 million for a software for health care and behavior behavioral companies. And the biggest federal, you know, it's a federal funds.

0:59:19They were just giving it away. And I would never ever thought about, you know, applying it. And there's a company that want to supply this software, EMR system, you know, to us. I would never think about it unless I would know that it's a multiplier to my business. So it, you know, that's my insight for today. So one, one easy thing that may give you a little bit of an advantage here is that the big five consulting firms, you know, the Arthur Anderson's, even though they've evolved into a new name, PricewaterhouseCoopers, those kind of people. They, they are very familiar with exit strategies and multiples and, you know, the, you know, interest factor and things like that. Thank you. Accenture, Deloitte, PWC. Thank you. I'm a little bit out of the loop on that game. But one of the things they typically undervalue is the human connection. And since Jay talks so much about preeminence, there is a way to quantify preeminence in your business. My experience in this relates to the restaurant field, customer service engagement. And what I realized is that that a, the company that I worked for multiple years in and was in management.

1:00:53I started off, you know, like on the floor and worked my way into management. And one of the things that I realized is when they sold the business, they didn't quantify in a way that, that mentally connected with a buyer, that the true value of that business was in the customer service connection that created long term repeat business. So the way that you measure repeat business can match soft skills. So if you can, if you can list all of the soft skills, a business or service engages in, and you say that because of these 10 things we do on a consistent basis to welcome new people into the business, to explain our methodology, to give them our origin story, to guide them and lead them through a process, to reassuring them that their purchases were on point, to giving them ways to mitigate their risk, to, to thank them for participating and for guiding them to what's next after, you know, our product service has reached the end of the relationship to the next best thing that we've vetted and da, da, da, da, to make it do. When you say all of those things lead to us having customers for life or us having customers for seven years, which is three more years and the rest of the industry, and we believe

1:02:31that without any one of these, you would lose out on that decreasing your value by X percentage. And I think that it's really important to quantify those things because if you care about your team, one of the things that makes working at any business valuable is what you can offer to your clients. And as an employee or as a manager, knowing that you make a difference comes down to being able to have the, to be empowered to make a connection that matters to the end user, to the client, to the, to the customer. And, and those soft skills make a difference. And I think, I think that, that when we talk about exit strategies, it's easy to get lost in the numbers. And I want to bring back, because, you know, you're talking about consulting, you know, making sure that you look for and quantify those things that really do add the human value in the relationship. And I believe that that will, you know, it'll make a big difference and set you apart from, you know, some of the standards in the industry. Does that make sense? Absolutely. It's, it's, it's a piece that I kind of didn't think about. Very important piece. I'm going to add that to my, to my course. Thank you, Brian. My pleasure. And then let's see here, Amanda, let's

1:04:06bring you on. And I'm going to do a quick little run here, because I'm focused on people. And then I see some things. So Scott was saying, if you're in California, the state has resources for some companies to help pay for training. Hey, and, and that's true. I'm sure there are multiple countries, multiple states that have some sort of program, or there may be even nonprofits that can supplement, add value. And if there aren't, then there are plenty of online programs that may be able to collaborate with you, joint venture with you, so that you're not paying full price. You can offer to be someone's beta tester, give them feedback for a discount. So there's lots of different ways to get value added training. And you're right, Phil, Countins May. And what would Jay do though? Jay would say, hey, there's a way that you can get more than what you're asking for. And I'm willing to do that as long as I buy it on a profit on performance basis. Go ahead, Amanda. Hi. So I love this, this whole topic. This is starting my third business. I made the mistake of my first business of really having the business dependent on me too much. My second business I was able to exit. It was a nonprofit and had a board, so it was kind of an easy exit. So exit strategy is front

1:05:47and center of everything I do in planning now. And it's a great topic. I love what you just said about the soft skills and the touch, I call them touch points, right? With our clients. And thank you for that reminder. It's perfectly timed in what I'm doing as I'm onboarding a team this week. But for me, I think it's really, I tend to be preeminent in nature. It's just the way that my mind works. And this, this program has been so great because it really taps into that part of me. But I think really for me where I'm having some trouble is that I am too preeminent at times. And really, I think getting people to understand what I'm trying to build are people that are in the box thinkers, like dealing with lawyers and having them drop contracts and taking them 30 days to figure that out. Because I'm working in new areas or I'm creating things that people don't have templates for. It's a little bit of a struggle because I always tend to do this. I can't get insurance because there's no model for what I'm doing with my last business. And you know, right now it's with contracts. So it just takes a little longer for me to create these things. They always work out. I don't mind me what you do. Well, I, so I'm a business and community strategist. So I overlay community strategy

1:07:19online with business ideas to expand people's businesses and bring community strategy in. Okay. So people will bring me an idea and say, well, I'd like to have an online community, or I'd like to have a Facebook group. Okay. And this is what I do. But often, when I go to do their strategy, I'll bring back, well, okay, we can do a Facebook group. That's great. And there's ways you can sell within that group. I can absolutely do that with my eyes closed. But also, here's another idea, which would be a whole new division to your business, because that's how I see things, because I also have that mind. And here's another, you know, so I often give people a business strategy when I come back after I do their community strategy and give them that option, which leads to opportunities for me to have partnership deals and different opportunities, which just gets contractually very messy for me, if that makes sense, because it happens over and over again. Once I show people what they have the opportunity to create online, there's so many opportunities that people don't see there, because I've worked in this area for 10 years. People just aren't aware that there's so much there. When I open them to that and they don't know how to create it and

1:08:40I've done it, you know, and I've done it on a high level, they want to work with me. So it's just, I get boxed in sometimes by my creative vision and my abilities are just a little bit too far out there sometimes for insurance and for lawyers to work with. You have what I call an Einsteinian problem. You see, you are doing the work to see the complexity. So there's the simple, which is, you know, what the person had done. They've done the simple. And what you've done is you've seen a level of complexity. But the challenge is, is that there is a whole lot more work that takes to get from that complexity back to a new simple that is elevated from the first. Right. So that people don't get overwhelmed. Right. And then there is something about memory. We cannot remember or comprehend something we do not what I call have hooks for. So if we do not have a allegory experience in our own lives, we can't make the connection. This is why Jay uses so many stories, analogies, similes, when he describes these things is he's attempting to relate a concept to more common hooks.

1:10:22Like this is, this relates to the auto industry. An example, blah, blah, blah. This relates to, you know, so getting someone to talk about how they do something, and then you seeing how this would fit into their model. So you take, like let's say you're talking to an attorney or an insurance agent and you say, what would you use as a model to talk about X type of business? You know, what is a good standard? And can you describe that for me? And then you can say, yeah, that's essentially what we're trying to do here. We're just tweaking this and this. Yeah. And that's how I ended up finding the common ground with a lawyer, because a lot of people aren't working online in the spaces that I'm working in. Finally, you know, he owns property, I own property, we're both landlords. And I ended up describing, you know, what I needed through a common, you know, well, he said, oh, so if you, then he tried to hire me. You could build a group, you could build a Facebook group for me, per se, for landlords that, you know, had difficult clients and that needed to evict. And you could give me lead generation for, you know, potentially landlords that needed to evict clients. Yes, I could do that for you. Like, so then he could understand it. I didn't, you know, what I do. And he has to do that, but,

1:11:49you know, I would need. So he understood that, but that's like one platform. And I'm like, oh, my goodness, this is like, I'm, I got frustrated with the way my mind works sometimes, because like you're saying, I have to do this multiple times in multiple ways. And I couldn't even get insured with a nonprofit, because I couldn't get, it's gotten better now. I got insurance stuff. But the internet scares people insurance-wise. And it's just a little frustrating. I think I'm a little ahead of the industries. You know what? I hope that you find a way to celebrate this, because it is your superpower. And again, Jay said in a different context, but, you know, hire the best. A part of that is knowing what you need. And there may only be two insurance agents in the world that can help you. But once you find them, what kind of advantage would you have? Because how many people have a bigger problem than what you have? You know, there are uninsured billions of dollars right now, because insurance agents are too lackadaisical and too, you know, myopic to see the big picture of a few things. If you can find the two or three agents that can get a big picture and you get them to open up their scope of, you know, where they can cover

1:13:34the oyster. I mean, that could be a business bracket all in itself. If you can just find the right lawyer and insurance agent, that what you have is a huge problem that other people are experiencing. I mean, it's an interesting place I'm working in. I like a challenge, so I don't quit to like get what I want. It's unique about my personality, I guess, but yeah, it's an interesting area. I'm playing in and I want to push the envelope a little bit. I'm looking at, you know, how can I use blockchain to create my own community forum and get off the different media channels and the different community-based platforms I'm on and create, you know, a whole new experience. So I'm delving into that space and then I would get around all of these issues. You can create contracts on blockchain and you don't have to insure anything. So ultimately, that's what I'm looking to do long term, but I like to challenge myself. So if anyone's looking for non-fungible tokened insurance and legal contracts, make sure you're in about a year and a half. Give me a year and a half. I'll figure it out. But yeah, three-armonates rules. I mean, it really does. It does. So I love everything about this and I love the whole exit strategy. And really, I think we need to be thinking about that with risk mitigation

1:15:03because people are out there creating things that we, you know, beyond Star Trek, beyond what I ever imagined. So it's a great topic. It's a great topic. Thank you so much. Our pleasure. Thank you so much for the conversation and good luck. And when you find it, you know, let me know. I might need an insurance agent and a lawyer in the future. I'm going to find it. Don't worry. Might be on another plan. I didn't say if I said when. Yeah. Okay. Thanks. You got it. All right. Are there any last comments, questions? Otherwise, I'm going to call it a day. And thank you all. We're going to be doing something a little bit new. So keep your eye out for an email. We may post that we're going to be launching the clubhouse maybe 10 or 15 minutes or maybe half an hour after we start. We might do it so that we have a little bit of discussion beforehand and then do a half an hour or an hour clubhouse where we stream one of Jay's earlier podcasts that relates to one of the beyond exponential concepts. And then Scott and I will lead a discussion on it that you are welcome to join in and participate in. So that's our plan for next week. And as Jay gives me direction on what the future will be. And when we lock in a date, I will be sure to get that shared with all of you. But until then,

1:16:38I want to thank you all. And I want to challenge you to find the metrics that you can use so that someone valuing your business will see the multiples. It is truly worth and challenge yourself to double it and double it again, like Dr. Bernard suggested, and until the point where it seems impossible. And then ask your team, well, it's impossible unless and open it up to some amazing possibilities and have some fun strategizing on how you can grow your business to the next level beyond exponential. Until next Monday, make it awesome. Thanks again, who for the for the copy of the book. And yeah, I always appreciate everyone who's on this. You make my Mondays better. So thanks again. See you again next week. Bye.