Why Creating Another Business Isn't The Answer Ep 518

Summary Notes


In a candid discussion, the host reflects on his entrepreneurial journey, highlighting the pitfalls of dividing attention between multiple ventures, as he contrasts his experience with that of a successful trash company owner who capitalized on his expertise by replicating his business model. The host emphasizes the importance of strategic focus, saying no to distracting opportunities, and the value of perseverance and deepening one's knowledge in a single field. He stresses that growth comes from improvement within an existing business rather than starting new ones, citing personal anecdotes and the wisdom of sticking with what works to achieve long-term success.

Summary Notes

Starting a New Business

  • The speaker reflects on their experience of starting a new business while already being a CEO.
  • They acknowledge the temptation of starting another business due to the potential profits.
  • The decision to start a new business led to increased revenue but decreased profit.
  • The speaker admits that the skill set they had at the time made starting the new business a mistake.

"And the next year, I made one of the biggest mistakes of my business career, which was I started another business."

The quote highlights the speaker's reflection on their decision to start a new business as a major mistake in their career.

"So my profit went down and my revenue went up."

This quote indicates the financial outcome of starting the new business—higher revenue but lower profit.

Learning from Others

  • The speaker discusses a conversation with a neighbor who transitioned from a trash man to a successful business owner.
  • The neighbor's approach contrasts with the speaker's, focusing on leveraging existing skills and knowledge.
  • The neighbor's plan to replicate his previous successful business model is highlighted as a pragmatic choice.
  • The neighbor's background as a blue-collar worker who built his business from the ground up is emphasized.

"And he went from trash man to cash man and sold his business for multiple eight figures."

This quote introduces the neighbor's success story, emphasizing the significant financial gain from his business.

"He's like, I'm so good at trash, and I've spent the last three years working for the company that bought me."

The quote explains the neighbor's rationale for sticking with the industry he knows best and leveraging his enhanced understanding.

Strategic Focus and Saying No

  • The speaker highlights the importance of strategy and knowing what to decline.
  • They emphasize that not every opportunity should be pursued and that understanding one's business avatar is crucial.
  • The speaker shares a lesson learned about growth not necessarily coming from novelty but from honing existing strengths.
  • An anecdote about an agency coach considering a pivot into general business illustrates the temptation to diversify prematurely.

"A strategy means knowing what you say no to."

This quote underscores the essence of having a strategy—being selective and focused.

"You have to know who your avatar is and who it isn't."

The quote stresses the importance of understanding the target customer for a business and not trying to cater to everyone.

Development of Character Traits

  • Success in business is often attributed to character traits such as grit, stick-to-itiveness, and perseverance.
  • Focus is also highlighted as a crucial trait for maintaining a successful path in business.
  • These traits are necessary to overcome the seductive distractions that can derail one's focus from their main business goals.

"Sticking with it was from developing the character traits of grit, from developing the character traits of stick to itness, from developing the character traits of perseverance, of focus."

The quote emphasizes the importance of developing strong character traits to maintain commitment and focus in business endeavors.

The Woman in the Red Dress Analogy

  • The "woman in the red dress" from The Matrix is used as an analogy for seductive business opportunities that can distract an entrepreneur.
  • These opportunities become increasingly attractive as a business scales.
  • The speaker emphasizes the need to emotionally defeat these distractions to avoid losing focus on the main business.

"And I think that at all levels in business, you get seduced by a woman in the red dress, which is the analogy that I like to use, because at every level in business, like, if you know the Matrix, there's a woman in the red dress who walks by Neo, looks again him, and then it's an agent pointing a gun at him."

The quote draws a parallel between the distracting temptations in business and the scene from The Matrix, suggesting that opportunities may not always be what they seem and can lead to negative consequences.

The Cost of Distraction

  • The speaker shares a personal experience of being unable to turn down a lucrative opportunity, which ultimately cost them time and potential growth in their main business.
  • The lesson conveyed is the importance of focus and the dangers of splitting attention between multiple ventures.

"And for me, it turned out I wasn't able to turn down about a 20 or $30 million a year opportunity when I was doing about 20, $30 million a year. And what ended up doing is it cost me a tremendous amount of time and effort and probably lost growth on my main business at the time because I didn't know what I didn't know."

The speaker's experience demonstrates the pitfalls of pursuing multiple business opportunities at the expense of the primary business's growth and success.

The Role of the CEO

  • A CEO cannot effectively run two businesses simultaneously due to the divided attention and focus.
  • The speaker asserts that a CEO's role is crucial, even if not involved in day-to-day operations, as the CEO is responsible for strategic thinking and improvements.
  • Attention to small nuances and dedication to the business are what drive excellence.

"You can't be CEO of two businesses. You can't serve two masters if you're the one running your business. And CEO, make no mistake, is the one running the business, even though if you're not doing the day to day just because you're like, oh, I'm an owner."

This quote highlights the necessity for a CEO to be singularly focused on their business to ensure its success and growth.

The Illusion of Multiple Ventures

  • The speaker argues that the amount of money made is proportional to the entrepreneur's skill, not the number of businesses they run.
  • Starting more businesses can lead to a plateau in income and distract from addressing the challenges within the existing business.
  • Improvement and growth should be sought within the current business rather than looking for quick wins elsewhere.

"And I think what ends up happening for most people is that one of the truths that I've observed is that the amount of money that I make is only proportional to the skill that I have as an entrepreneur. Period. That's it."

The quote suggests that an entrepreneur's income is tied to their skill level, and dividing attention between multiple businesses will not necessarily increase their income.

Focus on Core Business Growth

  • The speaker encourages focusing on growing and improving the existing business rather than diversifying prematurely.
  • The anecdote about a high school acquaintance in the general contracting business illustrates the point that excellence in one area can lead to significant growth.
  • The principle that "better begets bigger" is emphasized, suggesting that improving the quality of the business will naturally lead to its expansion.

"Better begets bigger, not the bigger you get, the better you get."

This quote encapsulates the idea that focusing on improving the quality of the business is a more effective strategy for growth than simply increasing the size or scope of the business.

Importance of Commitment in Business

  • Commitment and time investment are crucial for business success.
  • Initial learning in business is substantial but not the primary differentiator.
  • Long-term commitment leads to deeper insights and disproportionate returns.
  • The concept of "stick-to-itiveness" or grit is essential for leveraging time as an asset.
  • Persistence in business practices, rather than constant novelty, drives growth.

"The deeper you can sink your roots in, the more time you can put under the bar. This has been my finding. The better the business becomes and then as a result, the bigger it becomes because it comes from the disproportionate gains in knowledge we get at the end of the track, not at the beginning."

This quote emphasizes the value of deep, sustained engagement in business and how it leads to significant gains over time, which are more pronounced in the later stages of business development.

"It's learning what you learn in the 10th year and the 20th year. In that same business that gets you the disproportionate returns."

The speaker highlights that the knowledge gained in the long run, after a decade or more, is what truly sets a business apart and leads to significant competitive advantage.

The Power of Marginal Gains

  • Small improvements can lead to significant competitive advantages.
  • In highly competitive environments, like the Olympics, marginal gains can be the difference between winning gold and not placing.
  • The concept of marginal gains applies to business, where being slightly better can result in a "winner-take-all" outcome.

"You've got sprinters, and if you're the best sprinter in the world, you win the gold and you might only be one 10th of a second better than the fourth best sprinter in the world."

The quote draws a parallel between athletic competition and business, showing how a small margin can lead to vastly different outcomes in terms of recognition and rewards.

Consistency and Confronting Hard Truths

  • Consistency in executing the "boring work" is a core tenet for successful businesses.
  • Growth for entrepreneurs often comes from refining existing practices, not always introducing new ones.
  • Businesses must confront the reasons behind a lack of growth, such as insufficient word of mouth.
  • Continuous improvement is necessary, and avoiding it can be detrimental due to ego protection.

"It's using time as an asset instead of a liability. It's not being in a rush. It's understanding that the growth that comes as entrepreneurs doesn't come from new, it comes from doing the same."

The speaker advises on the importance of patience and persistence, suggesting that growth is often a result of consistent effort over time rather than constantly seeking new ventures.

"If we're not growing, then it's our fault. It's not because we need to introduce a new thing. It's because we need to confront what is not happening."

This quote stresses the need for self-reflection and accountability in business. If growth is stagnating, the cause often lies within current practices, not necessarily the need for new strategies.

Separating Business from Personal Needs

  • Businesses should focus on serving customers, not fulfilling the personal needs of the owner.
  • Using a business to satisfy personal desires for attention, status, or novelty can be counterproductive.
  • The business's purpose is to serve the customer, not to compensate for the owner's insecurities.

"And we use our business to try and satisfy our personal needs, when in reality, the business is only there to serve the customer."

The speaker points out a common pitfall where business owners might use their business to address personal issues, which can detract from the business's primary goal of serving customers.

Personal Experience with Business Focus

  • The speaker shares their own experience of running multiple businesses without focus.
  • Committing to a single business led to significant personal and professional returns.
  • The lesson underscores the importance of focus and dedication in achieving success.

"When I started my first five years in business, I think I had like eleven businesses. And it was only once I chose to commit to one of them that I saw the disproportionate returns in my life."

This quote provides personal testimony to the benefits of focusing on a single business venture, which resulted in greater success for the speaker after years of spreading efforts too thin.

Entrepreneurial Focus and Commitment

  • Entrepreneurs often start multiple ventures with the hope that one will take off, but spreading oneself too thin can prevent success.
  • Commitment to a single venture is crucial for it to have a chance to thrive.
  • Success in business often involves simple concepts that are emotionally challenging to implement.
  • The speaker emphasizes the importance of sticking to a strategy for compounding returns.

And so you have to pick and you have to commit.

This quote underscores the necessity of making a choice and dedicating oneself fully to ensure the success of a business venture.

The Simplicity of Success Concepts

  • Understanding the principles of success is not intellectually hard but is emotionally difficult to practice.
  • Common knowledge like spending less than you earn or eating less than you burn is not often followed.
  • The simplicity of these concepts does not guarantee ease of execution.

Most people understand that you have to spend less than you make, right? But no one does it.

The speaker highlights the discrepancy between understanding a concept and actually applying it in life, reflecting on the emotional challenges involved.

Strategy and Long-Term Growth

  • Having a clear strategy and resisting distractions is essential for business growth.
  • The speaker uses the "woman in the red dress" as a metaphor for attractive opportunities that can derail focus.
  • Persistence in executing a chosen strategy leads to growth.

And that of doing more, of being able to stick your head down and continue through what you said you were going to do, is what creates the growth.

This quote illustrates the importance of consistency and perseverance in following through with a strategy to achieve business growth.

The Misalignment of Internal Needs and Business Goals

  • Internal desires can lead to sabotaging one's own business efforts.
  • The speaker shares a story about Henry Ford to illustrate how personal boredom with a marketing campaign does not reflect the market's perception.
  • Entrepreneurs must differentiate between personal feelings and what is effective for the business.

And so we sabotage things inside of our own business because we want to satisfy things inside of us that have nothing to do with business.

The quote emphasizes the danger of allowing personal needs to interfere with business decisions, which can undermine success.

Self-Reflection for Entrepreneurial Advancement

  • Entrepreneurs need to identify whether they lack a belief, trait, or skill to reach the next level.
  • Recognizing and addressing personal deficiencies is key to business growth.
  • The speaker suggests that some entrepreneurs create chaos in their businesses due to subconscious comfort with chaos from their past.

Is it a belief about the world that that is incorrect? Is it a trait that I have not developed yet? Or is it a skill that I lack?

This quote encourages entrepreneurs to introspect and identify areas for self-improvement to overcome barriers to their business's success.

The Value of Repetitive, Boring Work

  • Success often comes from doing repetitive and seemingly boring tasks.
  • Consistency in marketing, selling, providing value, and getting referrals is crucial.
  • The speaker emphasizes the importance of doing the boring work as a core tenet of his business philosophy.

But that gets boring. And that's why do the boring work is one of the core tenets that I have.

The quote reflects the speaker's belief that embracing the monotony of effective business practices is a vital lesson for entrepreneurial success.

Sharing Experiences and Learning from Failure

  • The goal of the speaker's channel, Mosey Nation, is to share lessons from failures to help others avoid similar pitfalls.
  • The speaker values engagement with the audience to produce relevant content.
  • The invitation to subscribe suggests a desire to build a community of learners.

That is my hope. And if you enjoyed this and got value from this, hit the subscribe button, watch one of the other videos that we've got going on.

The quote conveys the speaker's aspiration to provide value through shared experiences and to foster a learning community by encouraging viewers to engage with the content.

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