3 Big Business Mistakes That Will Save You Millions

Transcription

Today’s episode is going to be in Spanish apparently. That should be a lot of fun. If this were 20 years ago, I could totally do that because I did quite a bit of Spanish in school and I could talk very fluently but that’s not what we’re going to do today. I apologize. Actually not, I don’t apologize. That’s just the way I rock sometimes, that’s the way I roll.

Introducing the three big mistakes

Today we’re talking about three big business mistakes. Try to say that three times fast. They’ll save you millions of dollars. These are actually three big and embarrassing business mistakes that I made since 2006 and I’ve extracted three of the thousands that I think will really hit home the most for you. My intention here is that I can provide a bit of wisdom, having kind of gone down the path and I can look back over my shoulder and you’re a little bit behind me and I’m thinking to myself, you know what? There’s a pothole coming up. If you can go around this way, instead of going through the pothole, it’s going to save you a lot. Cool.

You may have heard one or two of these before. I don’t know, but I’m going to share them nonetheless.

In 2006, I started my first business online selling information products, right? Workouts, et cetera, et cetera. I didn’t know what I was doing, we’ll just put it that way. I had no idea, no direction, no coach, no business model, no system, no rhyme or reason, no plan, nothing. I just said a bunch of everything, right? It was like a buffet of stuff that really didn’t make a lot of sense.

Mistake number one: Don’t take advice from everyone

At the time I was still training clients and one of my clients, his partners said, “Why don’t you package your workouts into like physical DVDs and stuff and people will buy them.” I was like, cool, let’s do that. He also said, “You should do some trade shows because then you can sell them at the trade shows.” I thought to myself, okay, cool. You’re a successful-ish type of person. You have your own business. Hey, I’m going to take your advice. Let’s do it. $35,000 later, I come back home a couple of weeks. I was living in a house, third floor of a house and I remember coming home one day and I just see on my front porch stacks of boxes. It was ridiculous.

It was just so many boxes from floor to ceiling. I’m thinking to myself, oh my god, that’s a lot of inventory. Number two, I got to carry all that stuff upstairs now because there’s no elevators you know, these creaky stairs. I had to carry all those boxes up. Then our apartment was maybe 800 square feet so our entrance hallway, which was not much of a hallway, whatever it was, it was floor to ceiling boxes. That’s all it was for probably more than a year. It was just floor to ceiling boxes of inventory. I’m thinking to myself, okay, I’ve got an issue now because number one, how am I going to move this stuff? If people did buy this, how am I going to get it out of my house? What does shipping and fulfillment look like? This is not really convenient. This is not a lot of fun. That was the first dilemma. Second thing is that I had to put all the frigging products together. One box was the box itself, the packaging, which was flat. I had to take a cardboard thing that’s like the cover for whatever product and you’ve got to unflatten it so it puffs out and you have all the sides.

I don’t even know if I’m explaining this properly, but anyways, I had to make the outside box make it … I had to turn a flat piece of cardboard into a box and I had to do that like a thousand times over. Then I had to stuff all the DVDs and CDs in the box with the booklets for every single one of them. Then talk about a waste of time, right? Then I’m thinking, okay, well I’ve got to now transport these finished products to wherever. We did four trade shows, which were a really good learning experience that I would never recommend you do because here’s the thing, at a trade show, you’re one of a hundred or a thousand exhibitors. People are walking by with suitcases, not because they’re moving, because they’re empty and they’re looking for freebies and the free samples from all the different vendors. That was a really big rude awakening because I’d never done a trade show. I had no clue what the heck was involved. We go to the trade shows, we had some of our workouts on display that they could listen to on their iPod. We had a pretty good setup. It was pretty cool.

Again, we’re asking people to workout. These were like women’s shows and health shows and it wasn’t like going to Paleo f(x). Okay. It wasn’t like that at all. Long story short, I spent about $35,000 in products. Another 10 or 15 in trade shows and we may have made like, who knows, a couple dozen sales. It wasn’t anything to write home about. For the next 10 years, no, nine years, nine years, I had all of these boxes in my house so we started off in the apartments. Okay. I had floor to ceiling boxes in our whole entrance way. Got rid of maybe one or two of them and then we still had like dozens of big heavy boxes. We bought our loft in 2010 I think. Took all those boxes to the loft, put them in the storage locker, never touched them. Didn’t sell them because I’m like I got to send them to my fulfillment center in the states, which is going to cost me more than the value of the products themselves. Did that. Moved to our house out of the city when we moved out there, took all the boxes again with us, tucked them in our crawl space, took up the whole crawl space.

Then when we moved back to Toronto four years ago, took all the boxes back, and I remember the movers just piling them up in the garage. I looked at my wife Amy, and I said, you know what? This is ridiculous. I’m going to take every single one of these boxes to the dump, which was about five minutes down the road. I packed up my car, did two or three trips and I just threw them. I just tossed them in the dump and I’m like, I don’t even give a shit anymore. This is garbage. This is ridiculous. I’m holding onto this dead weight that I’m not doing anything with. I’m not even selling this stuff. What am I doing? I threw all of the inventory in the garbage eight years later. My big epiphany with that is don’t do that. Okay.

Number one, if you’re going to do physical products, never have this stuff shipped to your house, just have it done at a fulfillment center, which I didn’t even know about at the time. Obviously, we’ve done physical products since then, but I don’t see them. They’re in a fulfillment center and they get shipped out from there and it’s a lot smarter that way. Never package your own products. It’s stupid.

It was a massive waste of time, massive waste of money. The worst part is that I actually took out a credit line, that initial $35,000. I had that credit line for almost 10 years. It was just sitting there, I don’t even want to pay it off. It was ridiculous. I must have spent, I don’t even know, it must have been close to $20,000 in interest. It’s crazy. Yes, I mean, maybe I could have been more physically responsible with this and paying it off sooner but it was just ridiculous. Such a huge mistake. If I come back to the lesson about this is number one, don’t take advice from people who aren’t already doing or have done what you want to do.

Mistake number two: Be clear on what you want

Number two is you have to be really clear on your vision. You have to know what you’re going to do before you do something. Otherwise, you might get into something that you don’t necessarily want to do. We’ve actually had this happen I think two or three times with clients who they start with us and then five months down the road they’re like, “You know what? I actually don’t want to be an entrepreneur.” I’m like, I don’t care. That’s your problem.

Okay, that’s why we qualify people extremely aggressively, assertively, whatever, on the front end because we’re like, listen, this is going to be hard. If you have a change of heart four months down the road, that’s on you, that’s not on us. Okay? That’s your choice. There’s no refunds. There’s none of that nonsense. Right? We’re not going to give you a refund because you had a change of heart four or five months down the road. You have to be super clear about what it is you want to do. If you want to work with us, cool, but if you’re like, “I’m not sure.” We’re not going to work with you. That was a big lesson. Just knowing what you want, getting the right guidance, and don’t listen to people who should not be giving you advice. Very often that includes your spouse. As I’ve mentioned in one or two YouTube videos that are called, why most spouses don’t support you. It’s a sad truth. Okay, that was the first one. The second big blooper, second big mistake, I’ve talked about this before, was 2009.

Mistake number three: Be careful with your promises and sell what people want

At the tail end of my three year struggle online, I had a great idea. I’m going to interview a dozen or so of the most successful online fitness experts and we’re going to talk about how they’ve stayed in such great health and such great shape while building six and seven figure businesses. I’m thinking to myself, who wouldn’t want to know this stuff? Really, I just wanted to know that stuff. It wasn’t even about anyone else. I was like, I just want to know this stuff. I spent several months interviewing 13 experts. Made a lot of big promises. I said, guys, this is going to be a huge launch, seven figures. It’s going to be the biggest launch the fitness industry has seen. I put myself out there, befriended a lot of these awesome experts and made a lot of big promises. I spent probably about three or four months building this whole thing out, interviews, the funnel, the whole bit. The night before we go live, I’m out to dinner with some friends. I’m like, guys, “Whatever you want, it’s on me. Take your pick.” Drinks, food. It’s all good. They’re thinking like, “Dude, did you just won the lottery or something? What’s going on?”

I told them what was going on the next day and they’re like, “Cool, man, that sounds awesome. I hope it all works out.” Next day I jumped out of bed like a kid on Christmas morning, run down to the Christmas tree, also known as my computer. Opened it up, checked my stats and zero like nothing. I’m like, what the hell is going on here? Back of my mind I’m like, okay. The problem is that the website is down. Obviously, there’s so much traffic. We must have just blown the circuit. Checked the website, it’s fine. Talked to our tech team or the tech guy who built out the site. I said, “Any issues?” He’s like, “No, everything’s good.” I looked at the stats a bit more in depth, looked at the traffic. Traffic was coming in. That’s when I had that sinking feeling in my stomach. I’m like, oh my god, this is not working. Long story short, four day promotions, we did this four day launch. I had all the partners, all these people promoting it. I’m like, hey guys, this is going to work. We made some tweaks, it’s doing great, whatever. What was supposed to be a seven figure launch turned into a $5,000 launch.

After paying out commissions, I ended up with $1,500. Pretty good use of my time, right? Four months of work, a lot of big promises. I looked like an idiot. I completely lost face. I felt completely embarrassed. Here’s the big lesson there. Big lesson there is be very careful about what you promise. Okay. I’m all about over promising, but you’ve got to over deliver as well. I was too naive and I was too inexperienced back then to make those types of claims. Number two is don’t sell people things you think they need. Sell them what they want. I was selling motivation. That’s what I was selling. I was selling interviews, which are essentially now known as the summit. I was selling interviews on behind the scenes, inspiration, motivation stuff. People don’t care about that. It’s like, “Yeah, I’ll just watch that on Netflix for free but if I’m going to buy something, I want a frigging solution to my problem.” That was a big lesson for me. Third lesson is despite all that, you know, all the bad stuff, there was a silver lining.

The silver lining was I made some really good friendships even though I kind of blew it on the promotion and I made some promises that obviously weren’t fulfilled in terms of the outcomes, I was able to really solidify a lot of great relationships in that process. Some of those people are still some of my best friends to this day. I’m very grateful for having had that opportunity to build those relationships. Obviously, everything with respect to the launch was water under the bridge because most people understand like, listen, it’s not the end of the world. Sometimes what you think is going to work just doesn’t. As long as you learn from it, it’s all good. Those are a few things that I pulled out of that. One other thing I recognized, I don’t like doing launches, I don’t like doing launches. With that said, let’s talk about the third big blooper and this is actually not necessarily a blooper but it was almost a massive one so I’m going to share with you.

Book writing and distribution

My book, “The All-Day Energy Diet,” this was my first published book. It was published with Hay House, such a great company. Reid Tracy, the CEO is such a great guy and I’m forever, eternally grateful for them because they’re such amazing people. This is 2014, so now I’m like, you know, built a seven figure business, big following, good name in the space and I am hellbent on hitting the number one spot on the New York Times list. That’s all I cared about. Every single day I was visualizing this, I was strategizing. Nine months out, nine months out of the actual launch, which was going to be in September, I was strategizing the funnel, the game plan, the whole bit. Starting to really fortify my team, JVs and people who are going to support the book. I’m thinking to myself, this is a book. No one’s going to support a book if there’s no money in it, because most book launches don’t make anything for anyone. I said to myself, if I want people to support the book, I need it to make sense for them financially.

What I decided to do, as I said, I’m going to buy all the books or I’m going to buy however many books I need to buy and we’re going to give it away for free and we’re going to do a free plus shipping offer. That meant I was going to invest $300,000 to buy books, to buy my book. Then obviously when people bought it, we obviously distribute it appropriately so that the New York Times list would see them as normal book sales. That’s obviously a very popular play in the whole book launch game just in case you haven’t noticed. Nine months of testing, test it up one funnel, ran Facebook ads to it. Didn’t do so well. Try this one. Try that one, try this one. Finally, we got really confident on … We had a really good funnel. It was making good money for a free book. The way this worked was at the company we were working with to distribute the books, they require the money, $300,000 the day before the book was published. Right? I think the book went live on September 21st. They needed the money September 20th. The challenge was that I didn’t have all that money.

I had to ask some friends and colleagues. I’m like, “Hey guys, are you willing to loan me some cash short term? I’m going to give you a really good interest rate and I’m going to pay you back in a week.” Obviously everyone’s like, “Dude, you’re full of crap. How are you going to pay me back in a week? That’s a really big claim.” I told them, I’m like, “Hey man, we’ve been testing this funnel for like months. We know our numbers, we know our metrics.” I have two people step up. That’s right. One person stepped up and said, “Yeah, I’ll transfer the money.” It’s all good. The Friday before the money was due, he pulled out. Here I am on a Friday afternoon, and I’m short $180,000. I’m thinking, oh my god. I don’t know if I’ve ever been in such panic in my life. I had a momentary breakdown and then I thought to myself, dude, pick yourself up. Pick yourself up off the floor and get resourceful. You need to figure this out because if you don’t, you’re screwed. I’m the type of guy where it’s like, I don’t care what’s going to happen, but I’m going to figure this out.

I had to do something that I never, ever, ever want to do again in my life, which I got super uncomfortable and I started reaching out to everyone I knew, sending them emails, phone call, text messages, “Hey man, I’m in a real bind. Can you loan me some money?” Some people were like, “No, you’ll figure this out. You’re a resourceful guy.” I was like, fuck you but thank you. Right. That’s how I felt at the time. Then two people stepped up. I’m not going to mention their names, but one of them is a very, very well-known coach for entrepreneurs. I was actually in his program for quite some time. I will be forever grateful for him for stepping up and supporting me on this because he believed in me and that was huge. Another person who was a really great friend and a colleague in our space and he stepped up as well. Between the two of them, I had $180,000. It was a very, very stressful couple of days because the thing is that the banks aren’t open Saturday and Sunday for the most part.

This was like a Friday afternoon and I’m scrambling. It was really, really intense. They came through. They wired over the money, had the money, wired it over to the company. The next day we go live and things went great. Everyone’s promoting it. All the partners was doing really, really well. Earnings per click are off the charts. People are making great money. The book sale, they’re flying off the shelves virtually really. I’m thinking like, this is really, really going well. The next week, I get a phone call from my agent on a Tuesday night. I’m having dinner with my kids and my wife. She was like, “You hit number two.” I’m like, what? She’s like, “You hit number two on the New York Times list.” I was like jumping for joy, and I was just like, who hit number one? She’s like, “Peter Thiel, Zero to One.” I was like, who’s that? Then I figured out, he’s like the co-founder of PayPal, initial investor in Facebook. I’m like, okay, I’ll give it to him, whatever.

That was the journey of my book launch but the thing I want to remind you here of is number one, if I did not do that, my book would have been like in the ethers. Which means that if I did not take the onus on myself to invest $300,000 to make sure this book launch was going to go the way it needed to, number one, the way most people do book launches, they don’t have the cojones to do that. I don’t think you need to do that because I don’t think it’s a very good use of money or stress or risk because what if it flops? You’re out $300,000, but the cool thing is that those two people that stepped up to loan me the money, I paid them back in five days. The New York Times listing was awesome but I was even more proud of the fact that I was able to … Sorry, my dogs are going crazy upstairs because apparently someone’s at the door.

I was most proud of the fact that I was able to pay them back in five days, which was my initial promise, which was great. Big lesson learned from five years prior when I made a lot of big promises and couldn’t deliver, now because of my experience and wisdom, I feel more confident in the promises that I was making. The thing here is that if you have a book, and most people want to write a book. I tell them, don’t write a book because unless you have a massive platform, and I’m talking about, I had the biggest people in our space support us. All the people you see on TV, the New York Times bestselling authors, the big experts in the health and fitness space, they were all supporting this book launch. Now, if you don’t have those friends, don’t even bother. Okay, because it’s not going to be worth your time. You need a massive amount of books to move if you want to hit the New York Times list. Even then like why, what’s the point? If I think of like why, what’s the point of hitting the list? It means nothing. It’s like having a PhD. Cool, I got that, but it really doesn’t do anything.

It’s nice to have now, but I’m happy I have it, but would I do it again? No. Knowing what I know now, never. If you got a book and you want to sell the book, you got to ask yourself why am I trying to do this? Why do I have a book? Am I trying to use this as a business card to put out there and hopefully I’m going to get clients? Because if you want to get clients, just get clients. Don’t tippy toe around the situation. Just get clients. Build out your perfect client pipeline. Save the book for a couple of years down the road when you got more of a following, when you got more money to throw at it, right? If you’re starting relatively early on in your business and you’re hoping that your book is going to do it for you, I’ve seen this too many times to think otherwise. It’s just not going to happen, right? You need a huge following and then you can’t just get people to be like, “Hey man, can you mail for my book and send people to Amazon?” You might have a few people that’ll do that, but remember there’s an opportunity costs for everyone’s time and their resources.

Someone send you an email sending an email to their email list, getting people to go to Amazon, what are you making? What does that person making for themselves? Were they’re going to make, whatever, 10% commission on Amazon sales? It’s not enough for most people. You have to structure the launch in a way that rewards your partners and even a bigger way that it rewards you. Most people are not willing to do that. It takes a lot of testing. It takes a lot of guts. It takes a lot of money to throw at this. There’s been launches where people are giving away like Teslas for first prize. I’m like, you guys are insane. Right? $10,000 first prize. That’s one of the things that we give away. Actually, sorry, that’s not true. One of our top prizes was $20,000 or we pay in full for whatever mastermind you want to join for that coming year. That, I mean is ridiculous, right? It’s stupid. Those are some of the things that you have to do to get people to promote your stuff beyond just wanting to help their audience.

Why anything worthwhile isn’t easy

I’m telling this to you because there’s again, I see this over and over, every single thing you are considering doing or have done, I’ve done. The membership sites, the book launches, the free plus shipping stuff, the supplements, the summits. We’ve done all of it, all of it. Every single thing you’ve seen online, we’ve done. We have a blog that gets a million visitors a month, our YouTube channel has 270,000 subscribers. Everything. Okay? Some of this stuff works really well. Some of it doesn’t. You have to understand what goes into creating those outcomes. That’s the thing that people don’t understand. That’s the thing that I really want to share with you in this podcast in these episodes is what goes into this stuff because if you don’t realize what you’re getting into, you’re going to have some challenges. When we work with our clients, we tell them very honestly, like I’m telling you right now this is going to be the hardest thing you do, there will be days where you cry, maybe.

There will be days when you doubt yourself. There will be days when you’re asking yourself, man, this doesn’t work. Can I do this? We tell them all that stuff upfront because if they were to work with us and they didn’t realize that, they’re going to have massive buyer’s remorse, and we don’t want people to work with us who are not willing to accept that because building a great business is not easy. Anything worthwhile in life is not easy. If you’ve got kids, is it easy? Hell no. Is it rewarding? Maybe. I think so. I think it’s the best thing ever, right? It’s my legacy on this planet is to just be a great dad. Having a great relationship with your spouse or even your friends, is that easy? No, it takes a little bit of thought and it needs to be a priority. Anything that is worthwhile is not going to be easy. If you’re looking for easy, you’re looking in the wrong places. I really want you to not look for hard, but just understand that like with working out for the first time, you’re going to have some soreness.

My intention with this episode was to just give you some of the lessons that I’ve learned in three or two big flops and then potentially a third big flop that was diverted and avoided based on my experience and wisdom.

Anyways, I hope this has found you well. If it makes sense, I’d love to hear your thoughts. Hit me up on Instagram @healthpreneur1. Just send me a DM and be like, “Hey dude, man, that was legit,” or, “You’re full of,” you know what.

Anyways, second announcements. We’ve got our Luminaries masterminds coming up, Toronto, June 26th and 27th. We have a handful of spots left. If you want to join us, go to healthpreneurgroup.com/2day, so the number two, D-A-Y. Learn more of what we’re doing at the event. If it resonates with you, then fill the application. We’ll get back to you within about 24 hours. Couple things on that. You have to have an active coaching business. You have to actively be coaching clients and you have to be generating revenue. If you’re brand new and you just got your coaching certification, it’s not for you. Okay, that’s the deal.

It’s going to be a great two days together. You’re going to have my hands on help to help you get more clients, scale your coaching and make a lot more money and really set things up properly. If that’s of interest to you, then the clock is ticking. Go to healthpreneurgroup.com/2day.

Thank you so much for joining me. Hope you’ve enjoyed this one and I’ll see you on our next episode.