Complete Business Skills TIER LIST

Summary

• Sales: As an entrepreneur, it's crucial to focus on sales in the beginning. You don't need to build a large sales department; you need to learn if you can sell. The founder should be the first salesperson and engage in sales conversations to understand who your product or service fits.
• Finance: Understand your core numbers, such as revenue, margin, and net margin. Track your profit and loss (P&L) month over month, but learning to create a P&L yourself isn't necessary when starting out. You can outsource this task affordably and focus on using those numbers to drive sales and marketing efforts.
• Offer Development: Learn how to price, package, and communicate the value of your offer. Make sure to understand the terms of payment and develop offers in line with market demand. If you're having trouble, consider reading "100 Million Dollar Offers" for guidance.
• Product Development: Focus on creating a product that meets customer needs. Start with a minimum viable product (MVP) and iterate based on feedback. Take customer objections as ideas for improving your product or service.
• Communication: Improve by learning to listen actively and take different perspectives. Ensure that the information you relay to your team, customers, and vendors is received correctly. Adapt your communication skills to develop better offers.
• Human Resources: Begin by onboarding people effectively, providing them with context about your business, and imparting necessary skills. Adequate onboarding sets up a foundation for workplace harmony.
• Negotiation: Focus on creating leverage and understanding what the other party desires. Early on, this isn't a critical skill, but it's integral in vendor relationships and contracts in the long run.
• Hiring and Recruiting: Treat recruitment as you would customer acquisition. Use job forums and networking sites to build a "talent acquisition funnel" for your small business.
• M&A (Mergers and Acquisitions): This skill may be irrelevant initially but if your goal is to sell your business, design it with appealing features for potential buyers. Understand what such buyers look for.
• Marketing: Identify efficient marketing strategies that target where your customers are most active. Focus on a single channel before exploring others, and respond to customer feedback to refine your methods.

For established business owners:

• All Skills Upgrade to S-tier: Each of the mentioned skills becomes equally important as the business expands. As a leader, your role is to coach and cultivate a team that can excel in these areas to grow the business comprehensively.

Video

How To Take Action

I would suggest starting with sales because it's really important for you to know if your product or service will sell. If you're the first salesperson, you'll learn a lot about your customers. So, you should talk to lots of people and find out if they need what you're offering.

Then, I'd focus on understanding your basic finances. You don't need to make a profit and loss (P&L) statement yourself. You can hire someone to do it. But you should keep an eye on your revenue, margin, and net margin. This helps you make good decisions and grow.

Next, work on your offer. Make sure it's something people want and at a price they'll pay. You can make a simple offer and learn from what customers say. If you need help, you could read "100 Million Dollar Offers" to get better at this.

For your product, start with just enough to meet customers' needs, an MVP. Change it based on what people tell you. Listen carefully to any complaints or ideas customers have, and use those to make your product better.

Improving your communication is also key. Practice listening and make sure you understand different points of view. This helps when you're talking with your team, customers, and vendors.

If you're hiring people, give them a good start. Tell them about your business and what skills they need. This helps everyone get along and do their job well.

Marketing is important too. Try one way of marketing that's best for reaching your customers. Stick with that until it works well before trying other ways.

As your business grows, all these skills become more important. You'll need to help your team be good at these things too. But for now, keep it simple, focus on sales, understanding money, making a good offer, and talking well to people. That'll get you off to a strong start!

Quotes by Leila Hormozi

"In the beginning, the best sales person is actually the founder"

– Leila Hormozi

"The best way to sell is just be honest with people, to tell the truth and state the facts"

– Leila Hormozi

"If you understand how to price something, how to package it, and how to verbalize the pricing and packaging in a way that maximizes value for the customer, then you can develop an offer"

– Leila Hormozi

"What you need to know how to do is kind of like how somebody might know how to do paid ads; you need to understand how to acquire talent through a paid channel"

– Leila Hormozi

"I actually think that the reason that I was able to quickly get good at communication was I learned to be very good at listening"

– Leila Hormozi

Full Transcript

skills do I need and in what order do I need to acquire them what I want to do today is I want to actually rank a tier list of all the skills that somebody who is new to business at the end of the video what I'm going to do is I'm going to talk about these skills with somebody who is trying to grow their business in a more developed company so the first skill that I want to talk about is sales is essentially the exchange of money for product or service that you have now when you're first starting off in business you don't need to think sales like am I building a giant sales department a sales or you just need to figure out can you sell because in the beginning the best sales person is actually the founder in the beginning of every business that Alex and I started we were the first sales people and apples.com that means we were the first ones that were closing the first deals it is one of the most Paramount pieces of the business because it is the bridge between the marketing and the back end you learn so much about the customer through doing sales that I think you would be doing yourself a disservice in the beginning by not doing this starting out the more people that you talk to and have sales conversations with the more people that you understand who is a fit for my product or service and who isn't because a lot of the times people think oh I just can't sell but it might actually be that you're trying to sell to the wrong people it was the first skill that I understood personally in our businesses and because of it I was able to learn so many other skills because I had that Foundation I think that the best way to get better at sales when you're first starting off is to stop labeling it as sales I didn't read a ton of books on sales and I didn't know a lot about sales before I started doing sales I was told that I was just signing somebody up for a gym through that process of signing somebody up I think it relieved a lot of pressure it's not convincing people it's not coercing people it's just showing them you want this I have this your match the best way to sell is just be honest with people to tell the truth and state the facts about what you provide about what you do and about who's best for your product or service I'm going to rank this tier s so the second skill is finance really just the management of money within the company what that looks like to somebody just starting off it is just simply understanding your numbers what are the core numbers that are going to guide business decisions in the beginning of the business what's your Revenue what's your margin and what's your net margin simply said how much money do you make and then how much money does it cost you to make that money how do I make this number bigger and how do I make this number smaller and so you want to track those month over month that's what you would call a p l i don't think that it's important that you learn this yourself I think it's important that you learn how to read a profit and loss statement do you need to know how to create one no and I actually think it's a little bit of a waste of time for you to do that you can Outsource this for a couple hundred bucks a month to a firm that does small businesses and then you can focus on using those numbers to drive more Sales Drive more marketing and drive more people into the business and so for that reason I would say that Finance is lower on the list I'm going to rank it at a c the third skill to focus on is offer development I happen to know somebody who's an expert on this thing offer development is the goods and services that you agree to give or provide how you accept payment in the terms of that payment if you understand how to price something how to package it and how to verbalize the pricing and packaging in a way that maximizes value for the customer then you can develop an offer and if you don't know how to do that you should go pick up 100 million dollar offers because the book says it way better than I'm just saying on this video that is I would say one of the harder skills to develop and also the most important so an example of an offer would be when we had gym lock and at the beginning the offer was ten thousand dollars for 16 weeks in our program we're like pay us up front give us 10 grand whatever what we found is that something that was a much more incentivizing offer that was aligned with the marketplace we said actually the program sixteen thousand dollars for 16 weeks but you can pay us a thousand dollars a week because what we want you to do is you want you to pay us with the money that you're making from the program that you're in it made it lower risk for them because oh I'm paying you with the money that I'm getting from using the program they don't have to pay it all upfront and it gave them an inherent guarantee that they were going to make sixteen thousand dollars no matter what because we're saying hey that's how you pay us we're able to actually charge more get more success with the customers and create lower risk for them from the get-go so we had a lower barrier to entry the reason that this is such a high skill and I'm going to rate it as s on the tier is because it provides you with that much more leverage if you can get this one thing right it makes everything else in the business 10 times easier the next skill I want to talk about is product development it's the process required to bring a product from just concept to something that can reach the market and be a tangible better service to sell in the beginning when you are starting a business I think that there are three things that are really intermingled which is Marketing sales and product until you really understand your business and you get to like I want to say 2 million in Revenue they kind of all just blur you don't know which one you should optimize to grow the business and that's why it is important to focus on product because at the end of the day if the product is good it markets for you and so if you want to make your life easier focus on the product first so a lot of what that looks like for a small business is you have such an advantage because like I said you should be taking the sales call you should also be asking people what do they want in the beginning you just need a product that meets the needs or wants of the customer and you need to get an MVP out there it doesn't mean it's a shitty MVP it means it's an MVP that you're going to iterate on it over time don't think about solving 16 problems you can develop other things for that product development at this point is going to be solving one problem very well and you can then package that into your offer and deploy it into the marketplace when you're selling in marketing something I did in the beginning of gym launch is that what I'm going to be talking to you I'd be talking about product or service and they would say like what about this I would just write it down sounds like that's a great idea I should be taking all the objections and then figuring out how I can add those into our product or service to make a better product for the customer in the beginning the simplest way that you can track how well your product does is Word of Mouth how many people are requiring for a sales call or opting into your marketing funnel because somebody referred them to not because they're incentivized by making 50 Commission on that person but because that person said you have a good product service product development I would put it on the a tier because sometimes it's not the smartest thing to develop the product like full blown before you've tried to create an offer or sell it oftentimes in the beginning you have to change it like anywhere between five and ten times before you get it right it becomes a very imperative skill after you've confirmed with the market that that product is what they want to buy the next skill is communication communication in the context of business is the sending and receiving of information to make something known what does that look like it's how are you writing emails is what you say in the email what somebody understands when they read the email speaking to your team is what you're saying communicating what you're thinking in your head and then Translating that to them setting expectation ensuring that what you believe a job is is what an employee believes a job is that is where communication comes into play when you are new to business this is typically not somebody's strong suit it's usually something that's developed over time most of us tend to either over communicate or under communicate and what that looks like when you're unskilled is usually like you're silent or you ramble all the time I don't think that I was the best Communicator at first I tended to be more of like a silent type but I realized that that actually was bad communication I think that the best ways to learn how to communicate are to learn how to listen first I know that sounds contrary because communicating seems like oh it's talking but I actually think that the reason that I was able to quickly get good at communication was I learned to be very good at listening asking a person what they mean actively listening to them engaging in the conversation it teaches you how to take perspectives and if you're able to learn how to take the perspectives of different people your customer your employee your vendor then you are able to learn how to speak to them in a language that they understand and receive I'm going to rank that at tier B you know it's tough maybe it needs to go up because actually if you really think about it communication is how you develop an offer yeah I'm gonna move it up it's going to be us the next skill is going to be human resource management it's a strategic approach to nurturing and supporting employees so they can ensure a positive workplace and a productive this in my opinion the first skill you need to learn is properly onboard people you can just onboard people correctly then you can actually solve for a lot of those problems or make it a lot easier on the back end for yourself kind of like if you're onboarding a customer if you can just learn how to properly bring people into the business promise you you will figure out the rest from there the best way to properly onboard people is by giving them two things which is one context what are all the things that they need to understand about the business in order to do their job well why are you hiring this person what problem are they solving the second piece is the skills what are the skills they've come in with at this point we've assumed that you've hired them knowing they have these Baseline skills and then it is what skills do you have to transfer to this person to be successful in the job there's so much more to Human Resources but just get started these are the things I would focus on for those Reasons I'm going to rank this as a tier beat you oftenly have a couple people if you're not a complete dick they won't run for the hills they'll stick around the next skill is negotiation it is really a form of talking to somebody that resolves a mismatch in Xbox I think a lot of people think it's resolving conflict it's persuading people I think that's pretty gross I don't think that it is that at all in the beginning I do think that this is not the most imperative skill negotiating fees vendor relationships contracts deals always on that later because what I'd prefer is that we focus on the basics if you want to get better at negotiating you need to get better at understanding one who has the leverage in the relationship if you're able to create leverage in your relationships people will sacrifice some of their expectations to meet yours because you have something else that they get from you outside of that negotiation that they want more the second thing that you can do to get better at negotiating is understanding what the other person wants the first thing that you do with any negotiation is asking them what do you want what is the ideal scene for you A lot of times we assume somebody wants something and then it conflicts with what we want and then we think we have to negotiate but a lot of times you want the same thing and you just have different Visions about how to get there and so it just becomes a conversation about how are we going to get there together for that reason I would say that negotiating is pretty low on the tier list I would say that it's probably at the bottom the next skill is hiring and recruiting which is enrolling talent that supports your cause or Mission recruiting is to employees what marketing is to customers which is how are you going to get people to say yes to working for you just like you get customers to say yes to buying your product in the beginning you don't need to do it too many times because you only need a couple of people you just need to be good enough to get the first few people the biggest thing that I can say is understanding a talent acquisition funnel you likely don't have brand you likely don't have a ton of money you likely don't have a ton of Goodwill out there in the audience because you just haven't had time so what you need to know how to do is kind of like how somebody might know how to do paid ads you need to understand how to acquire Talent through a paid Channel whether that be LinkedIn whether it be Indeed job forums Glassdoor how to acquire leads there how to speak to them there and so it's taking the same principles from the external marketing and just flipping them for the internal marketing to get employees I would put hiring and recruiting at tier B the next skill is m a which stands for mergers and Acquisitions which is really the consolidation of companies or their assets through a financial transaction into another company or between companies this is something that I think is irrelevant to new business owners it is a completely different skill than running a business if your goal is to sell your business one day then understand that your business is a product to somebody else understanding who might buy your business one day helps you determine what are the product features that I'm going to create within my business to be the most appealing for this future purchaser you need to understand what's that buyer looking for in a business and then you can build that into your strategic plan so that one day you are an appealing product to that buyer reason I'm going to rank it at a d because I think it's just like for the most part in the very beginning like if you don't even have a product that people want to buy none of this really is relevant the next skill is marketing marketing is the activity of promoting one's business to make it known what does that look like in a small business it can look like a lot of things it can look like Word of Mouth it looks like referrals it can look like paid ads it can look like outbound it can look like direct messaging so I think a lot of people think marketing they have like billboard or radio ad or paid advertising or Facebook ads but there's so many other kinds of marketing out there in the very beginning of a business a lot of people make the mistake of thinking that they need to Market in multiple ways what you actually want to do is you want to Market in one way and get it as efficient as possible figure out how to Market in a way that brings in customers who create the most amount of revenue for the longest period of time where do my customers already hang out are they already active on LinkedIn are they active on Facebook if you've got a 70 year old grandma she's probably not on LinkedIn she's but she probably is on Facebook in some knitting groups and so it's understanding your audience based on where they have the most activity what platforms should I start on to Market to them we make content right now because we've been reinforced for making it people before we even had a business saw our content we're like we need things from you right so we're like okay obviously the content's good you know if you make content and you're not getting people saying that they want to buy something from you or they want anything from you maybe keep making it because you like making it but maybe that's not the right way to acquire customers so I'm going to rank marketing as tier a I actually would rank offer communication and sales above marketing because I think that if you can get the offer right you can communicate well enough to figure out what the offer even is then it makes the marketing really easy so that was for beginning entrepreneur now I want to talk about these skills in terms of more developed business owner what ends up happening over time is this all of these skills move to tear s you might be saying Layla why because now it's not just you what people think is that the priority changes but they actually all increase in priority you need to be good at all of those things to grow business and you can't do it alone it's how can I be the best coach for the best team so listen if you're a business you're doing over a million ebitda and you're looking for help go ahead look at acquisition.com now if you're not of that size then what you can do is you can go to this next video and in here I'm going to talk about the five principles of management that are the five principles that I use within access.com and our portfolio companies to grow them so they can make all of these skills as tier s