2 Ways to Build a Really Big Business

Summary

• To build a really big business, you can either sell something that people never stop buying or find a group of people who never stop selling for you.
• If I had a real estate brokerage, my network of Realtors would be the people who never stop selling.
• With something transactional, like solar roof installations, consider that people don't buy them frequently.
• For products or services with recurring customers, focus on upselling, cross-selling, and increasing purchase frequency.
• By doing this, you can spend more on acquiring customers because they keep buying, making it hard to fail.

Video

How To Take Action

Implementation Strategies for Entrepreneurs and Small Business Owners

1. Leverage Recurring Customers:
A good way of doing this is by focusing on products or services with recurring customers. For instance, if you run a gym, offer additional services like nutrition plans or personal training. Upsell and cross-sell related products—think protein shakes or branded merchandise. The more your existing customers buy, the more you can spend on acquiring new ones.

2. Build a Network of Sellers:
If your business model is more transactional—like real estate or solar installations—focus on building a strong sales network. A real estate brokerage should invest in a solid team of Realtors who are always selling. Encourage them with incentives and create a culture of constant sales effort.

3. Increase Purchase Frequency:
To keep your customers coming back, consider subscription models or loyalty programs. For example, a coffee shop can offer a monthly coffee subscription. This not only ensures repeat business but also makes it easier to predict revenue.

4. Upsell and Cross-sell Aggressively:
Once you've got customers, make sure you're maximizing their value. If someone comes in to buy a primary product, suggest complementary items. If someone buys a bike, offer a helmet, lock, and maintenance plan. This can be done at checkout or through follow-up emails.

5. Spend More on Acquisition:
When you know your customers will buy repeatedly, you can afford to spend more upfront to acquire them. This can include higher-quality ads, referral programs, or even partnerships with other businesses.

6. Monitor and Adjust:
Finally, keep an eye on what's working and what isn't. Use data to see which products are often bought together, which marketing strategies bring in the most valuable customers, and adjust your tactics accordingly. Always be ready to pivot based on real-world feedback.

By implementing these low-cost, high-value strategies, your business can grow sustainably and profitably. Focus on these areas and watch your customer base—and revenue—expand.

Full Transcript

there's only two ways that you can build a really big business that compounds you either sell stuff that people never stop buying or you find a group of people who never stop selling so if I had a real estate brokerage I have a bunch of Realtors my network of Realtors are the people that never stop selling for me because I know we had something that was more transactional like let's say it's putting solar rof Zone houses people don't buy a lot of those they just buy one of them or maybe they buy one much later but it's more or less you're going to have to have a sales network if you have a reoccurring customer you need to dial the living hell out of upselling cross selling increasing frequency of purchase so that you can afford spending more uh in the acquisition but you have to make sure that people keep buying it if you solve for that it'll be hard to fail