How To ACTUALLY Build a Million Dollar Company This Year
Summary
- Ask yourself, "Gun to head, how would I make an extra $2 million to $15 million this year?" This question forces you to think about highly probable strategies instead of uncertain or long-term ones.
- Leveraging existing resources and focusing on what has already proven successful in your business are more effective than starting entirely new product lines, especially if the goal is short-term profit.
- Look at your past performance, identify where you've made the most money, and consider how you can replicate or expand on those successful actions. For example, if two events brought in high profits, why not run more of those events?
- Avoid the allure of complex solutions just because they sound fascinating or innovative. Simple and effective actions that leverage your strengths will scale better in the long run.
- To exponentially grow your business, like aiming for a 15x increase, you'll have to think in orders of magnitude. This approach exposes the resources, people, and systems you're currently lacking and forces you to confront what it truly takes to grow.
- Use the "What would it take?" question to overcome mental barriers. List all the reasons you can't reach your goals, then flip those reasons into tasks or objectives that will help you grow.
- Adopting a "who do we need?" mentality is crucial when you're lacking the knowledge or skills in your current team to fill gaps and reach new goals. Hire key personnel that align with your strategic needs.
- Understand that you don't have to do everything yourself as a business leader. Your role includes assembling a team of experts who can execute the necessary tasks to achieve growth.
- In unfamiliar hiring territory, conduct many interviews to discern patterns in good candidates. Use these insights to create a hiring rubric that will help you evaluate future applicants effectively.
Video
How To Take Action
A good way of doing more with what you already have is to ask, "Gun to head, how would I make a lot more money this year?" This makes you focus on sure bets, not long shots. You can look at what made you the most money before and do that more. Like if certain events made good money, why not have them more often?
Simple solutions are better than fancy ones. Use what you've got and do what you know works. If something's been successful, do that more to make more money.
To grow big, like 15 times bigger, you need to think big too. You'll see what you're missing in your business, like people or systems. When you find what's stopping you, turn it into a task that helps you grow.
If you don't know something, it's okay. You can find someone who does. You don't have to do everything. Build a team with the right skills to help your business get bigger.
When you're new to hiring, talk to lots of people for the job. You'll start to see what a good candidate looks like and it'll help you pick the right person in the future.
Quotes by Leila Hormozi
"If you're trying to figure out this year how am I going to make more money, gun to head, if I had to make 2 million dollars this year, what would I do"
– Leila Hormozi
"Double down on your strengths, you're already doing something well in your business and you have things that are going really well"
– Leila Hormozi
"Simple scales, fancy fails"
– Leila Hormozi
"Most of the time setting a higher goal works but how you manage your emotions around that goal and your expectations and the teams and how you react when you hit or don't hit a goal I think is more important than if you're setting it higher or lower"
– Leila Hormozi
"Your job as the CEO is to assemble the team that is capable of doing these things"
– Leila Hormozi
Full Transcript
I'm going to teach you four questions that can actually grow your business in 2024 the first question you want to ask yourself is gunto head how would I make an extra 2 million 10 million $15 million in 2024 gunto head frame now before I get into what that means let me tell you a little story I was on a call with one of our portfolio companies they're doing about 50 million a year right now the goal was how are we going to add 2 million in iida iida is basically cash in your pocket to the business over the next year and then people start talking about the best way that we can add 2 million in iida is what if we started a new product line so to give you context this business currently serve businesses that are usually doing anywhere from $300,000 a year to maybe like 1.5 or 2 million a year and the goal was okay let's open up this new product line that can serve businesses that are doing anywhere between 20 to 30 million a year and so everyone's sitting on the the meeting and everyone's like yeah yeah nodding their heads like that sounds like a great logically yes like it's the same type of business they're just a bigger business it's an Enterprise versus the small businesses so let's just go upstream and so I sat there listening and the one thing that kept coming to mind for me was if I had a gun to my head this wouldn't be the way that I would bet that I would make $2 million in profit this year in fact I started doing all the math I'm like currently the resources we have in the company the marketing the sales the product the customer success the finance all supports SMB customers and now we're saying hey easy let's just go after the Enterprise clients we've been turning away well has anyone thought through how long is is it going to take to be able to learn how to attract those Enterprise customers how long is it going to take to train and hire a sales team that can sell Enterprise customers how long is it going to take to have a product that they tell their friends about and how long is it going to take to have a team who knows how to support Enterprise customers which is completely different than a small business owner and so when I laid this out in my head I said to myself if I had to back into how long each of those things are going to take think about a new marketing campaign alone that might take 3 or 4 months just so and so and then we've got to get the sales team hired and then we've got to get them trained up and that's probably going to take another 8 weeks all this time what the hell are we actually selling we don't even have a product we actually have never worked with Enterprise before so how do we even know what they want the frame that I gave them is I said if I had a gun to my head the way I would make $2 million and evida would not be by doing this that if we did this it would probably be 8 to n months before we even made a dollar and that doesn't even take into account all of the costs that go into building the new marketing building the new sales hiring every body up front training the new team not to mention this the cost of split attention because if you've ever had a business where you've served two customers it's a different business the frame is if you're trying to figure out this year how am I going to make more money gun to head if I had to make 2 million dollars this year what would I do and what that does is that frame puts me in a state of mind of if I had to be damn sure bet on my life that I was going to make $2 million what would I do it also happens to be that what you choose is usually something that is using existing resources that is not a departure from your mission and not a departure from your strategy and is more additive than it is a departure and so the cool thing is that you usually come up with a better plan it just doesn't sound as cool in fact let's look at the p&l for the last 12 months and where did we make the most money and it happened to be that that business made a ton of money from two events that they hosted and so I said is there any reason why we've only done two and then the response was well we've always just done two a year and I was like that's so interesting because in those two months you make four times as much profit as any other month is there a reason that we wouldn't do it every quarter every month every week and they were all like no we've just never done it that way and so I said I think a great way that we could make 2 million in profit this year is let's just do four more events we already know they work we just need to do more of them and it was like a light bul went off for everyone in the room in fact the highest level EX all were like yeah you're right and I was like do you see how that would be so much easier than starting up this new product line it will take a year if the goal is to increase profit do you need cash in the short term or the long term because option b over here which is build out the Enterprise level for clients is something that is an investment and it's probably going to take two years to significantly cash flow the business say you're making money by month 9 you're not even recouping your initial investment until like month 15 team and that's if it works I would say if your goal is to make money then it's a bad strategy to do that because you're going to feel pressur to go faster cuz you're like I need to make money though I need to make money it's like wait that's that's not how we do this right now if we want to make money what can we do more of that we're already doing successfully double down on your strengths you're already doing something well in your business and you have things that are going really well what you want to do sit down and write down what are the top three things that I do in my business that are successful actions and then how can you do more of those things to make more money in 2024 everyone's always looking for complex answers because you think oh gosh there's some silver bullet there's not do more of what works do less of what doesn't work I think a lot of people continuously chase the fancy stuff because they haven't been in business long enough to realize that it truly is the basics if somebody were to come here and see the things that we're doing with our portfolio companies like there's nothing batshit crazyer we don't have some crazy algorithm for marketing and sales and product and like oh yeah you know look at Alex's brand strategy they've all been like like the way that he posted this he was trying to put I'm like there I am there's me on the internet oh what no he was like tired and posted this thing and like people like her video when she said this right here it's because it's NLP I'm like I don't even know what NLP means and so a lot of people are inexperienced attribute problems or success to something complicated but it is actually the exact opposite what people who are billionaires know is that simple scales fancy fails simple stuff done really well over and over when you pour the gasoline on that that's what girl as a company fixating on complicated Solutions it's never going to work you haven't yet seen what happens next and so you just believe gosh it seems like there has to be something easier than this it has to get better right no it doesn't it just continues to be hard but you get better at it and you acquire more skills and then eventually you see hey I just got to do the simple stuff right the second question is how would we 15x this business in a year this question is going to help you think in orders of magnitude rather than inal Improvement so one of our portfolio companies I was reviewing all the materials for quarterly ahead of time I was sitting there and I was reading it and I just I can feel when I'm uncomfortable and I was reading I was like uncomfortable reading it I was like something doesn't feel right what's the evidence what's actually happening so I was staring at the monthly objectives and then I realized that I wasn't looking at the monthly objectives I was looking at the yearly objectives and when I was looking at them from a monthly objective I was like we could do more and then I realized that I was looking at the yearly objectives and I was hor I was like holy crap this is it I felt like I got hit with a ton of bricks I was like holy this is not going to grow the company you know I thought that that was like what we're going to do for a month let alone a year I'm like how on Earth would that take a year when I had that realization I was like the issue is that we are thinking in terms of incremental improvements rather than orders of magnitude with a lot of companies that are below 50 million in Revenue it doesn't help anybody to think in incremental improvements because it takes effort to maintain a company it takes even more effort to grow a company and so I was thinking to myself how do I get this founder to see this the same way I see it I need to get us thinking in a different frame of mind so I said what would it take to 15x this business this year because here's the thing most people can't even go to that level you would need resources that you don't have today you would need people that don't exist you would outgrow your systems which currently would absolutely break what most people do when they hit that is they say oh gosh I don't think we can do that because like think of all stuff I'd have to do that's like what growing a company is and so when I realized that I was like cool so we're going to write down everything it would take and while we were doing this it was really interesting because I could see the people on the team and the executive team was chiming in they're like well we couldn't do that because Sally I don't think she has the skill right we're going to need a new Sally and then they're like well we couldn't do that because we would need to get on like Salesforce right so we're GNA have that's another it's another goal for the year get on Salesforce and then they're like wait you know if we were doing that we would have to compensate our sales team to yes so we're going to have to change the compensation of the sales team it's like everything that people say that's why we couldn't grow the business those are the exact things that become the goals that help us grow the business the issue is that what I was seeing happened to everyone on the call is that they're they're keeping themselves stuck in this Frame of thinking very small the whole time they kept telling me why they couldn't do the things and I kept taking their objections and flipping them onto why we could do the thing you just told me how to do it you told me that system would break so in fact what that means we need a new system if you can take your objections and flip them into a prescription for how to grow your business this is what people who win do they look at the constraint and they turn it into an opportunity to achieve their goals so I'll give you a personal example of this I just hit like 400k on Instagram and so I was like maybe this year we could figure out like how instead of getting to like 500k like how would it get to 600 700k this year and then I was like you know what I just realized is the same principles that I apply to business could be applied to content so instead of saying how am I going to get Leila from 400 to 600k this year which doesn't really excite me what would it take to get Leila from 400k to 3 million this year what would have to happen and so it could put me in a completely different frame of mind I was like well I would dedicate twice as much time to content I would start up a new podcast show I would write a book I would work on content every day rather than one day a week and so I started just listing out all the things that I would have to do to make that happen the same principle that you can apply to business business like I just explained that I can apply to content like I just explained can be applied to any area of your life and I have seen that most of the time setting a higher goal works but how you manage your emotions around that goal and your expectations and the teams and how you react when you hit or don't hit a goal I think is more important than if you're setting it higher or lower and I think it puts you in a great frame because the likelihood that every time we say hey how am I going to 15x my business how I'm going to 6X my content that we actually hit that exact 6X or 15x I don't know right I don't have like the math on that or the statistics but what I do know is that you'll hit more than if you try to grow 20% the third question is what would it take the moment that you ask yourself these questions you're going to be thinking of all the reasons that this wouldn't work and a lot of times you can take the things that are the reasons why it can't work and turn them into things that you need to do to make it work I want you to ask yourself what would it take to 15x my business in 2024 and I want you to write down all the reasons you can't do it and then what I want you to do is exactly what I just did turn those reasons into tasks to do to grow the business and then you're going to look at it and say well gosh you know Lea I don't know how to make a funnel that way or I don't know how to migrate into that CRM or I don't know how to build a sales team of 30 people then you get to determine what skills do you need to acquire to grow the business to this degree or does just somebody have to have somebody has to have the skill of doing these things it doesn't mean it needs to be you every objection you have to Growing your business can turn into a goal to grow it okay so we were meeting with one of our portfolio companies and the business does around 6 million a year in Revenue it's on the smaller side and the business was growing for three quarters and then this last quarter it is stagnated and I was talking to the CEO asking her what did you do that caused it to stagnate essentially I could tell that she was so in the weeds because she told me about 60 different things that they did as to why it stagnated I was like I'm pretty sure like your executive assistant like not bringing you coffee didn't have anything to do with it stagnating nonetheless what it told me is that she was very much in the weeds of the business and she was involved in absolutely everything and that actually pointed to more of a problem itself which was for every solution that we would present she just told me 16 ways why it wouldn't work and so the frame that I flipped to her is I said well what would it take to make it work and then she started listing out begrudgingly all of the things that she would need to do to make the business work I would need a new marketing and sales leadership probably demote my head of customer success I think that I would have to bring in somebody to create a new product I would have to implement a way more rigorous sales training program she's like but we don't have any of those things and that is what keeps a lot of businesses stuck they're constantly referencing what exists today as a reason for what cannot exist tomorrow we've gone through what does it take to hit this Revenue Target and then they list out everything it takes and I say great I'd love you to create an or chart that supports that one rule no names on the or chart and the or chart looks great most of the time it's like ah that makes sense we'll move maybe this or that but like overall this makes lot sense I think this would support our goals and as I'm going through it and I'm asking questions I can see their face getting more and more concerned and I say like what's wrong well if this was the or chart where would Sally be but there's usually one to three people in an organization that because the founder so close to them they put off making massive changes to grow their business because they're concerned about that one person and what it does when you have no name or charts is it exposes to you that one you are capable of hitting the goal you do know how to put the organiz ation together to hit that goal but also on the the third consequence of that is that you probably do have people changes that you have to make so all of the things that we just listed out that are reasons that the business could not hit that Revenue Target now become our goals for the Year this is the list of things we need to do to hit that Revenue Target if we change these things we upgrade these things we add these people then we are able to hit our targets and so that's how you can use your natural inclination for negativity to your advantage if you can flip it and then these three questions lead you to thinking okay that all sounds great Lea but who's going to do it and that's the last question which is who do you need to make this happen when we had our business gym launch and we started a company called Allen within the business it was not supposed to be a software company in fact we just wanted to integrate software into our existing business I think a lot of people from the outside would say it was a big success you know essentially what we did is we used the profits from the existing business to help fund the creation of the software and during that time Alex oversaw the product and I oversaw the customer experience the ux and all the rest of the supporting pieces as the product came to fruition what I realized very quickly after I started learning more about software was that neither of us knew anything about software and we had done it all incorrectly I realized that in order to grow the company to where I needed it to we would have to undo a lot of the work that we had and so I think that is why it was not as valuable of a company as it could have been because we didn't build it right from the get-go because we were not the right who you know we started all these other companies ourselves why couldn't we do this one well I didn't realize how big the knowledge Gap was with one of our portfolio companies when we asked ourselves hey the company's worth let's say probably around 200 million today if we wanted the company to be worth 500 million in 3 years what kind of company would it have to be what would it take and then the answer to that was it would have to be a tech enabled company and so that means there is technology that helps facilitate part of the product or service that is valuable to the customer when we decided that the next natural question was who do we need nobody here out of all the three founders has software experience and so the first thing that we would need to do is if we wanted the best chance of success gun to my head who would I have to hire for to reach those goals and so the first thing that we did is we built out the new or chart with the who's that we need it because we know that hey before we go and on our own try and build a software company which we've never done before maybe we should just you know hire people who have you will go through the three questions that I've posed to you you figured out what you need to do to grow the business and how to have an awesome 2024 but then you get stuck at this piece which is you think that you need to do all of it and the thing is that you don't need to do all of it but you do need to assemble the team that does your job as the CEO is to assemble the team that is capable of doing these things and so if you're trying to grow the business in a way that you have no experience it would probably make sense to you that you would hire a consultant or a mentor or go to a event or purchase a course on that subject what if you had your own in-house subject matter expert of that thing rather than taking a course on how to build software what if you just hired somebody who build a software and had them in your company and you just had access to them all day it sounds simple but that's how you do it and that's how big companies get to where they are because they have those resources internally rather than constantly grabbing externally and then trying to do it themselves great Leela so I need to hire a CTO how do I even know that a CTO is good I apply the same principle to interviewing that I do to reading books so if I'm trying to learn something that I've never learned before I'm going to try and find the best books on the subject and read 10 of them and then take the common threads that I see throughout them and then usually those common threads end up being like those are sound principles that seem to be agreed upon by all people I take that and I apply that same concept to interviewing so I will interview 10 candidates and I will ask them how to solve these problems that they would be doing in their role and then I take the common threads from their Solutions and that is exactly what I use as the framework so now I know what good looks like because I've interviewed people enough times to see what are the common threads that they all say what are the things that all of them are repeating and then I use that to develop a rubric to which I can then put all of the candidates through to say who's a A+ a b or a c I hope you enjoyed this video if you're thinking to yourself this was all really great but I'm 3 million of Revenue or 10 million in revenue or 50 million of Revenue I have a video that I made where I contextualize what you need to do based on how big your business is