This past year two of my clients almost hit $100 million in sales. ALMOST. What’s most remarkable is that they started at zero. Zip. Nada. Zilch.
They started a business solely with what they knew and a lot of hard work. That leads to the first of five lessons I learned from them.
Lesson 1: If you want passive income, you need to start with capital (yours or someone else’s). There really isn’t a get rich quick scheme where you start with nothing and don’t work. You have to work.
This next lesson was actually something I already knew. But sure enough, as soon as I talk about this in a group, one of the first questions will be, “What was their business?”
And the answer is “It doesn’t matter.” ANY business that has customers who want or need your service will succeed. ANY business.
In this case, the two businesses couldn’t have been more diverse. One was strictly online with two owners who lived in different parts of the world.
The second was strictly bricks and mortar and there was no way to make it virtual.
Lesson #2: There is no magic pill. Or rather, it’s all magic. Waiting for the ‘right’ business and the ‘right’ opportunity is kind of like playing the lottery. You’ve got a very slim chance of hitting it big. The business that can grow big goes big because it’s at the center of 3 overlapping circles: what you are passionate about, what you are very good at (maybe even best in the world) and what the market wants or needs.
You can create that type of momentum in just about any industry. Instead of trying to transform yourself into someone else, do what YOU do best, care about and that fills a need in the market.
Lesson #3: Cash flow is king. In the beginning you need cash. As you grow you need cash. The real measurement of a CEO (you) will be how effective you are at turning assets into profit, how efficient you are at turning profit into net income and how productive you are at turning net income into cash. Without cash flow, you can’t have a business.
Lesson #4: Don’t go with ‘one size fits all’ answers. As these two companies grew so big, so fast, they faced completely different challenges. As you grow, your business solution may be that you need more sales, or more likely that you need to make better use of assets, watch costs or change the character of the income and your role in it.
Do you know how to quickly decipher what your business needs, before it’s critical? The clues are there. But, sometimes you need to help reading them. That’s one of the roles I played for these two clients. Identifying problems before they are problems and providing solutions before they need them.
What is the one thing stopping your business from moving forward right now? What would it mean to your business to know now what the problems are or know 3 years later after suffering through losses you didn’t need to take?
Lesson #5: Be careful whose advice you take and, for that matter, who you hang out with. If the people who you listen to haven’t been part of a team that has built a business up fast, they have opinions, not advice. To grow the fastest in the safest way, you need an experienced team.
I’m also going to add one more. Successful business owners always looked at the ROI. They didn’t have expenses; they had investments. Every single employee is an investment. The ROI on that employee will tell you whether it’s a good investment or a bad investment. They weren’t afraid that something was “too expensive”. Instead, they looked at whether that investment had an ROI that would justify the expense.