The Power of Prioritization Making Every Move Count (GymCon Day 1) Pt. 1 Ep 559

In a dynamic presentation, the speaker, founder of acquisition.com, delves into the intricacies of strategy, branding, and business growth. He challenges the traditional understanding of branding, arguing it's less about social media presence and more about the associations and perceptions customers form. Emphasizing the importance of meeting customer expectations, he suggests that local businesses focus on product quality over online branding. The speaker also demystifies strategy, defining it as a matter of prioritizing resources to maximize returns. He shares real-world examples, illustrating how identifying the constraints of a business and focusing on the most impactful actions can lead to exponential growth. Additionally, he underscores the value of building a business that doesn't rely solely on the owner, thereby increasing its worth and the owner's wealth. He concludes with a call to action for business owners to confront uncomfortable truths, such as addressing underperforming employees, to unlock their business's full potential.

• Strategy is often seen as an important yet nebulous concept in business.
• The speaker emphasizes the significance of strategy in selling products and growing a business.
• The speaker is documenting their own journey in building a business to provide insights similar to what one might have gained from business magnates like Bezos, Musk, and Buffett.

"Strategy is a big, fluffy, amorphous word that gets tossed around a lot and no one knows what the fuck it means, but it's probably important, and in my opinion, is the most important."

The quote highlights the speaker's view that while strategy is frequently discussed and somewhat enigmatic, it is crucial to business success.

• The speaker intends to structure their talk in a dynamic, fast-paced manner akin to TikTok videos.
• They aim to ensure the audience can maximize their financial gains from the event.
• The presentation will involve live drawing rather than slides for better engagement.

"I'm going to do something different than I normally do for any kind of talks because I was thinking about this, and I was like, all right, how can I get everyone there to make the most possible money leaving the event?"

This quote explains the speaker's goal for the talk—to help the audience make the most money possible from the insights shared during the event.

• The speaker briefly addresses branding, suggesting it may not directly increase profits.
• They explain that a brand is like a bouquet of flowers, a collection of associations rather than a tangible entity.
• The speaker will focus more on money-making strategies than on social media branding.

"I was originally asked to talk about branding on social media. I will talk about brand for about 5 minutes, and the main reason for that is because I don't think it's going to make you more money."

The quote indicates the speaker's belief that while branding is important, it may not be the most effective way to increase revenue, which is why they will limit their discussion on it.

• A brand is a set of intangible associations made between known and unknown entities.
• It is important to deliberately cultivate the associations you want your audience to make with your brand.
• The speaker emphasizes the need to be vigilant about maintaining brand associations to avoid dilution or unwanted connections.

"So, big picture, brand isn't actually a thing. It's an association we make between things that we know and things that people don't know, which is usually our company."

This quote captures the essence of branding as the creation and management of associations between a company and certain qualities or ideas in the minds of consumers.

• The speaker suggests that local businesses should focus on product and service quality to build their brand.
• Personal branding efforts on social media may lead to opportunities beyond the local business scope.
• There is a risk of becoming overextended by trying to cater to both online and local clientele.

"The brand that you're going to build in a local community is going to be based on the quality of your product and your service. Your reputation is going to be based on that."

This quote emphasizes that for local businesses, the brand is closely tied to the tangible quality of their product and service, rather than the broader associations that might be cultivated through social media.

• The brand for local businesses equates to their reputation.
• Reputation is built on consistently meeting customer expectations.
• Overdelivering is often discussed, but meeting expectations is already a win.
• The importance of making and keeping promises to build brand loyalty.

"I think that for most local businesses, the brand is going to be about the reputation. The reputation is going to be built on consistently meeting expectations."

This quote emphasizes that for local businesses, branding is closely tied to their reputation, which is established by consistently meeting what customers expect from them.

"Make promises, keep promises. And if they liked the first promise you made them and you keep it, they'll be with you forever."

This quote highlights the significance of making and keeping promises to customers, suggesting that doing so can result in lifelong customer loyalty.

• Introduces a "magic wand" exercise to establish financial goals.
• Audience is asked to think of their desired monthly income.
• The exercise identifies the gap between current earnings and financial aspirations.
• Recognizing the gap sets the stage for strategizing how to close it.

"So right now, if I have a magic wand or you have a magic wand and you waive it and you get to make as much money as you want, all right? So write down or put at least think about it in your head, what number that would be per month."

This quote introduces an imaginative exercise designed to help the audience set a specific financial goal, which is the first step in planning for business growth.

"Wonderful. So we have just done is established a gap between where you are and where you'd like to go."

This quote acknowledges the identification of a financial gap between the current state and the desired goal, which is crucial for further strategic planning.

• Distinguishes between anxiety from too many choices and hopelessness from a lack of direction.
• Identifies the emotional responses to each scenario.
• Recognizes the importance of understanding one's emotional state to address business challenges effectively.

"If you feel stressed or you are overwhelmed about which thing you should do, that's this. If you don't know what to do, you're at a loss, you feel hopeless because you're like, I don't know what the fuck to do."

This quote describes the feelings of anxiety and hopelessness that entrepreneurs may experience when faced with either too many options or no clear path forward.

"Hopelessness means I have a lack of choices. So I have a lack of choices means I have ignorance around this topic."

The speaker connects feelings of hopelessness with a lack of choices, suggesting that this is due to a lack of knowledge on the subject, which is a problem that can be addressed and solved.

• Defines strategy as the process of prioritizing.
• Simplifies the concept of strategy to making choices based on what will deliver the most value.
• Expands on the definition of strategy as allocating limited resources against unlimited options.
• Highlights the potential of unknown unknowns to dramatically affect business outcomes.

"Strategy is just prioritizing. That's all it is."

This quote demystifies the concept of strategy by reducing it to the act of prioritizing, making it more accessible and understandable.

"It's how you choose to allocate resources that are limited against unlimited options. That is strategy."

This quote provides a more comprehensive definition of strategy, focusing on the allocation of finite resources in the face of limitless possibilities.

• Illustrates the impact of making strategic investment decisions through a case study of a photography company.
• Demonstrates the importance of reassessing pricing and business models to maximize returns.
• Highlights the significance of identifying opportunities that are not immediately obvious.

"So he's like, well, I charged five grand. And I was like, okay, well, what is the average photography studio add in revenue after using your thing? He said 400,000 a year."

This quote is part of a case study that shows a discrepancy between the service charge and the value provided, prompting a strategic reassessment of the business model.

"The reason I bring this up is that it wasn't a move that was on the board."

The speaker points out that the most impactful business decisions can often come from outside the expected set of options, emphasizing the value of creative thinking in strategy.

• Stresses the importance of strategic decision-making in achieving the greatest return on investment.
• Suggests that the quality of each move, rather than the speed, determines business success.
• Encourages focusing on fewer, more impactful actions to maximize results.

"If I can just get you to make the one chess move that will make you the most money, then it will roi everything you do this year or maybe the next five years."

This quote suggests that a single well-thought-out strategic move can have a greater impact on business success than many smaller actions.

"It's that you get more for each step. When you are more strategic, when you have better priorities, and you allocate your resources, time, money, energy into the fewest moves that get you the most bang for the buck, you make the most money."

The speaker explains that strategic actions are about efficiency and effectiveness, getting the most value out of each effort made in the business.

• The PR company example demonstrates the importance of focusing on the most valuable customers.
• By catering exclusively to the 15% of customers who paid the most and stayed the longest, the company improved its offerings and increased its prices.
• This strategic shift led to selling more units and a tenfold increase in the company's strategy.

"So we have a PR company that we bought that was selling 100 units a month of PR services... But I really like the founder... 85% of the businesses churned out within two or three months... What if we stop selling these 85% and only sell these 15 and cater our stuff to only them?"

The quote explains the initial problem with the PR company, which had a high churn rate, and the strategic decision to focus on the most loyal and profitable customer segment.

• The concept of volume times leverage equals output is discussed to maximize business results.
• The idea is to get the most out of every unit of effort, which may involve strategic moves and leveraging other people's time.
• The speaker emphasizes the importance of leverage, especially for those who prefer not to be actively involved in day-to-day operations.

"The equation for this is volume times leverage equals output, which means the more times you do something and the more you get for each time you do it, the more you get, ultimately."

This quote introduces the formula for maximizing output in a business context, stressing the significance of both the frequency of actions and the value derived from each action.

• The association of dentists example illustrates an innovative approach to business model transformation.
• By bundling services and selling them as a package, the company can achieve higher profits and more attractive exit opportunities.
• The strategy involves rethinking the value proposition and structuring deals to benefit both the company and its members.

"What if we take ten every year, bundle them up, and sell them for 100 million every year, get 20%, give 80% to them. That'd be chill, right?"

The quote suggests a creative way to reorganize the business model, increasing the value of the company by packaging and selling services in a more lucrative manner.

• Identifying and addressing the primary constraint of a business is crucial for growth.
• The speaker argues that many businesses fail to grow because they focus on the wrong areas, not because of a lack of effort.
• The media company example shows that sometimes the constraint is not the quality of the product or service but the lack of something to sell.

"The constraint of the business is that you don't have something to sell... if we just went from zero to 20, we would probably make you ten times more money than you're currently making."

This quote highlights the importance of identifying the true constraint of a business, which in this case was the absence of a product to sell, rather than improving an already high-performing aspect of the business.

• The speaker introduces a strategic planning process for business growth.
• Asking why a business can't grow tenfold helps to reveal the underlying issues.
• The planning process involves setting clear objectives and determining the necessary steps to achieve them, such as hiring the right people.

"One of the questions I like to ask is, why can't we ten x this business? Like, why can't we? And sometimes asking that question, and then it becomes really apparent what the problem is."

This quote presents a probing question that serves as a starting point for strategic planning, aiming to uncover the obstacles that prevent significant business growth.

• Identifying the three core objectives for any business investment: acquiring more customers, increasing lifetime value of customers (LTGP), and reducing future risks.
• Emphasizing the importance of these objectives in enhancing enterprise value.
• Highlighting the need for a business to continue functioning independently of its owner to increase its value.

"It has to map to one of these three objectives, which is, one, how is this thing that we're going to spend time, money, effort on going to get us more customers? Two, how is this thing that we're going to spend time, money and effort on get us increased LTGP, make them worth more? Or three, how is the time, energy, et cetera, going to decrease the risk that this does not continue to happen in the future?"

This quote outlines the three key business objectives that should guide where resources are allocated. It stresses the significance of aligning business activities with goals that promote customer acquisition, customer value enhancement, and risk mitigation.

• Comparing two businesses with identical financials but different operational structures.
• Demonstrating how a business's reliance on its owner can drastically affect its market value.
• Explaining the concept of leverage and its impact on net worth.

"This guy is a single owner, runs all the day to day, has lots of minions known with real brains, and they just do what he says. Okay, if this person dies, the business dies. This guy has a team that runs the whole thing, and he makes $2 million in income from the business, but it doesn't require him."

This quote compares two business owners to illustrate the value of a self-sustaining business model. It suggests that a business that can operate without its owner is more valuable, as it is less risky and more attractive to potential buyers or investors.

• Clarifying the distinction between earning income and building wealth through asset ownership.
• Recognizing the asset value of a business as a key contributor to an owner's net worth.
• The long-term financial strategy should focus on increasing the value of assets rather than just income maximization.

"You become wealthy from the shit you own, not the shit you do."

The speaker emphasizes that true wealth is accumulated through ownership of valuable assets rather than through the performance of tasks or services. This statement underlines the importance of focusing on asset value as a means to build net worth.

• Discussing the significance of hiring and maintaining top-tier talent in a business.
• Comparing the business strategies of small and large business owners, particularly in their tolerance for mediocrity.
• Highlighting the transformative impact of having a team of high-performing individuals.

"The difference between small businesses and big businesses is how many a players they have."

This quote underscores the idea that the success and growth of a business are largely dependent on the quality of its employees. It suggests that having a higher number of exceptional team members is what distinguishes larger, more successful businesses from smaller ones.

• Addressing the need for business owners to confront underperforming employees.
• Discussing the mental and emotional challenges associated with having difficult conversations in the workplace.
• Emphasizing the potential for business growth that lies beyond these challenging confrontations.

"The biggest lever of growth is on the other side of a few hard conversations."

The speaker highlights that the path to significant business growth often requires having difficult discussions with underperforming team members. This quote suggests that avoiding these conversations can hinder the progress and success of the business.

• Advocating for honest and direct communication with employees about their performance.
• Introducing the concept of a performance improvement plan as a structured approach to addressing performance issues.
• Encouraging business owners to take decisive action when employees fail to meet expectations.

"Write down the name of the person that you know you need to get back to and start what we call a performance improvement plan. You've got 14 days to fix your shit or get out."

This quote advises business owners to identify underperforming employees and initiate a formal process to improve their performance. It emphasizes the importance of setting clear expectations and timelines for improvement, and being prepared to take action if those expectations are not met.

• Summarizing the key points discussed in the side quest.
• Encouraging the audience to take immediate action based on the insights provided.
• Reiterating the importance of addressing issues directly with the relevant parties.

"So that was a side quest, but hopefully we found some treasure there."

The speaker concludes the detour from the main topic by hoping the audience found value in the discussion about managing personnel and confronting performance issues. This quote serves as a summary and a call-to-action for the audience to apply the lessons learned.