How to Make $1,000,000 in 2021

Summary

• Aim for clarity on whether you want to gross a million or net a million; there’s a difference.
• Break down the goal into units and lifetime value (LTV); understanding these will guide your strategy.
• If aiming for a £10k LTV, you need 100 clients for a million gross; that's about selling to two clients every week.
• Reverse engineering your goals creates a clear path; calculate how many sales calls are needed based on your close rate.
• Always incorporate a buffer at each stage to account for variability and to set realistic targets.
• Determine your cost per sales call and budget accordingly, factoring in a buffer for safety.
• Assess how much you need to spend on ads weekly to hit your target number of sales calls.
• Dedicate time monthly to create effective ads and weekly to review and update them according to performance.
• Implement a structured daily ad spend to consistently achieve the required volume of sales calls.
• Build a reliable backend system to ensure the LTV of £10k is maintained through good service and upselling.

Video

How To Take Action

I would suggest first identifying if your goal is to make a million in gross revenue or net profit because there's a big difference. Aim to understand how much one customer is worth to you, which is what we call the Lifetime Value (LTV). If your LTV is £10k and you want to gross a million, you will need 100 clients total. That means selling to about two clients every week.

Next, work backwards to figure out how to get those two weekly clients. Let's say you close one in every five calls. You'll need ten calls a week to land two clients. But since things can go wrong, always plan for a bit more. If you usually have a 75% show rate on calls, aim for around 15 scheduled to have a buffer.

Now calculate your cost for each sales call you make and add a safety margin to it. If a call costs you $50, budget $75 for each, just in case. This means you'd need to spend about $2250 per week on ads to get those 15 calls.

To keep this going, set aside one day a month to create good ads and a few hours every week to tweak and improve them based on how they perform. Allocate a daily ad spend to hit your number of calls consistently.

Make sure once you get clients, you have a solid system to offer good service and opportunities to spend more (upsells) with you, so each customer really does reach that £10k LTV.

Here's how you might put this into action:

• Determine your true LTV.
• Break your million-pound goal into weekly milestones.
• Calculate and plan for more calls than needed to hit your sales target.
• Set a weekly ad budget, with a safety margin built-in.
• Dedicate time for ad creation and regular review.
• Have a backend system to maintain LTV through service and upselling.

By following these steps, your path to a million pounds becomes much clearer and manageable.

Quotes by Alex Hormozi

"You have to think about units versus LTV"

– Alex Hormozi

"I close one out of five sales calls"

– Alex Hormozi

"Now I need 15 calls a week"

– Alex Hormozi

"I would block one big calendar day per month to make all the ads and the copy"

– Alex Hormozi

"So, if it's two clients a week… I just reverse engineer from there"

– Alex Hormozi

Full Transcript

if i want to make a million if i want to make a million pounds next year in 2021 obviously against the market circumstances like what should i be thinking about okay here's how you do it everyone ready so you have to think about units versus ltv so when i talk about growth consulting cash flow consulting i've made you know a handful of videos about it when people pay me 50 grand for six hours i literally break it down to these two core pieces which is how much is a client worth how many do i need to sell right and if you want to do a million gross versus a million net so we just need to be specific here if you're just looking for a million gross then you have your ltv at 10k you need to solve 100 clients right which means you need to sell two clients a week 52 right times two give yourself a little bit of buffer right so and then i just reverse engineer from there so if it's two clients a week and i know that i close one out of five sales calls then it means i need 10 sales calls a week that show and if i know that let's say your average show rate is 75 then i'm just going to say 15 so it's at 66 to give myself again at each level i give myself a tiny buffer so that it makes it realistic that i'm going to achieve it so now i need 15 calls a week in order for me to make get 15 calls a week what's my average you know cost per call yours is like five dollars uh but for everyone else you know it's it's a couple hundred dollars but let's say yours is 50 i would say okay i'm going to safely budget 75 right uh and it's 15 calls so that's 22.50 per week in ad spend that i need to spend uh which means that i'm spending you know uh divided by whatever seven is 300 bucks a day right and so for me to get to and how many ads do i need to make to spend a day profitably probably need to make 10 good ads per month and so that means i would block one big calendar day per month to make all the ads and the copy and all that stuff i block out two to four hours a week to review them you know update the copy change you know change creative etc and then three hundred dollars a day yields me my 15 calls 15 calls gives me 10 shows 10 shows gives me two sales and then because of the back end system that i built i know that my ltv is 10 grand and that's the game you