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EXECUTION 3 Businesses & The Road to $1M in Personal Income

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SPM_ENT

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Today Is my birthday and it usually forces me to reflect and look back at where I am in life. Business/entrepreneurship has been a huge constant and I wanted to keep a chronicle of my journey and Latest Business (#3) in hopes that I can help people along the way as well as be able to look back and see how far I have come. My current goal is 1m personal income annualy.

The journey really starts 9 years before this post when I opened Business #1.

Business #1:
Gross: $600k
Profit: 25%
Employees: 5
Years Owned: 6


I was 26 and had no real vision in my life other than drinking in bars and picking up women. It was a lot of fun and provided instant gratification however I wasn't building any wealth and I couldn't continue on that path forever waiting for something to magically happen in my life. I started working for a guy and bringing in business for commission. I did that for about 6 months while learning the business. Eventually, I didn't agree with his business practices and decided to open my own shop. I had 9k to my name and put 6k down on a lease. In my first month, I had to sink or swim and it forced me to do whatever it took to survive. Over the next 6 years, I built the company up to 600k in annual gross revenue at a 25% profit margin. I had 5 employees, 150 5 star reviews on Yelp (which was a good amount back then), and the company required only a few hours a day of attention.

Before I closed business #1 I had started my second business or Business #2 with a friend of mine. It was in a different industry but everything I learned from business #1 could be applied to business #2 and my new partner already had a decade of experience. Business #2 quickly grew and we did 1m in gross revenue in our first year. At this point, we were making good money and Business #2 was much more scaleable than business #1. The landlord for business #1 was forcing me out of my location and it was extremely difficult to find a new location so I decided to close /sell the assets for Business #1 and put all my focus on Business #2 and scale.

Business #2
Gross: $2m
Profit: 14%
Employees: 8
Years Owned: 4


Business #2 and my partner taught me so many hard lessons. Mainly in cash flow, trust, communication, and knowing your craft. I will try to make this as short as possible. My partner constantly wanted to take out more money than we were making. We got into debt because of cashflow and put us in a bad situation that left us waiting on a miracle. Fortunately, we ended up getting a miracle and we survived but it was too much for me to take and not repeatable. After that I found him taking money for his own projects out of our bank accounts. I bought him out of his share of the company and took on the business myself. I did that for 3 months which was the worst of my life. Our overhead was 130k a month (which was mentally crushing me) and when my partners left we had 13k in the bank. I grew the company back to 160k in the bank account but I didn't have enough industry-specific knowledge to run the company efficiently myself. I had made the most money in my life so far at the point and was completely miserable with stress and anxiety. I'm talking about rushing out of the office at 5pm holding back tears because all the pressure was so intolerable for me. After a certain point, I had enough and realized that I didn't have to do this. There was no reason other than my own mental state that was forcing me to continue. No amount of money was worth the mental pain I was in and I'd rather make 5k a month doing something I love than 30k a month hating my life. I called my old partner up and he ended up buying the company from me. An understatement when I say it was a HUGE RELIEF.

Business #3
Gross: TBA
Profit: 41%
Employees: 2
Years Owned: 1


Business #3. Another friend of mine and I started Business #3 to coexist and get referrals from Business #2. It did about 100k annually just on the referrals from Business #2. Unfortunately, we lost all the business referrals from Business #2 when I sold it. It didn't matter because I decided that I could do Business #3 completely differently. My friend/partner handles the day-to-day (which was usually my responsibility) and I was free to do sales, grow the company, and use my experience to set systems and automation in place. Enjoying my newfound freedom I started working on business #3 part-time in March of 2020. I would do the cold calls/outreach myself about 2-3 days a week. Our clients were other businesses exactly like Business #2 so I knew their pain points and what they were looking for. Everyone I reached out to really like my background and I got a few big accounts pretty quickly. In March 2020 the company was doing 7-8k a month. By August we hit 27k cash income and in Dec hit 39k. In 2020 we grew 130%. In Jan we hit $59k gross and were operating at a 41% profit. I recently hired my first part-time sales assistant. He works 2 hours a day and handles my outreach and books me meetings. He is reaching double the amount of leads I was when I started and we're getting a lot of traction. At the moment I'm going through a rebranding to really hit home with our target clients. With the new rebranding and more meetings, it's my goal to him 1m in gross revenue in 2021. This new business is extremely scalable and provides me the freedom that I desire.

I wouldn't have gotten to this place without going through the difficult last 9 years. I made huge mistakes when jumping at shiny objects and jumping into business with the wrong people doing the wrong business models. Hard lessons that I narrowly escaped. I have plenty left to learn, especially with marking and sales, email marketing etc and I know I'll make a ton more mistakes but I'm very excited for the future. All of these lessons have made it so much easier the third time around and should enable rapid growth.

Thank you to everyone for the help along the way and I'll keep updating this month or so if it's interesting for you guys to follow the growth. I'm happy to answer any questions or help anyone I can.
 

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Tiago

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Great to see how every experience you've had builds up for the next one. Curious to see how this unfolds!
 

thechosen1

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This is shaping up to be a great story, just needs more details.
 

Kid

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Is there anything else to say than "keep going" ? :)
Nice to hear that you are on better path. 1m personal income is good goal.

P.S Late happy b.
 

MJ DeMarco

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Great story, almost missed this, please don't forget to update! Congrats on early successes!
 

SPM_ENT

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This is shaping up to be a great story, just needs more details.

Ya, I've seen some other posts recommending not to give too much away about your business models. #3 is new so I'm even more cautious. Happy to answer questions if I can to clear things up though.

Is there anything else to say than "keep going" ? :)
Nice to hear that you are on better path. 1m personal income is good goal.

P.S Late happy b.
Totally, one thing leads to the next and the experience is worth every unrealized penny.

Thank you!

Great story, almost missed this, please don't forget to update! Congrats on early successes!
Thank you! I'm going to try to update monthly to keep things to date and interesting.
 

SPM_ENT

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End of Feb 2021 update:

This is a bit tricky. I was running the accounting on a cash basis but with this business model, I will switch it to accrual. I haven't done so yet.

Business #3
FEB Gross: $66,952 (Accrual)
on a (Cash) basis it was actually $33,000 at 12% profit (Reasons why listed below)
Profit: 59%
Employees: 1 (down 1 from last month)

Pros:

Lots of interest and meetings coming up for new clients. My outreach assistant is killing it with our new strategy of a soft opening. Early on we were just doing a type of HEY!! USE MY SERVICES!! I quickly changed tactics after I was bombarded on LinkedIn by messages of SBA funding and other services. The messages I was receiving were such a turn-off and so archaic it's hard to describe the feeling. I was repulsed by the mix of gluttony, desperation, and just a general lack of any sort of intelligence. I'm so thankful for those annoying people for sending me those messages because I was one of them!

Things to work on:
My partner in this company has virtually zero experience in owning a business. The relationship between him and I will be my biggest hurdle of the entire thing. However, I can trust him completely to take care of the business which is something I've never had before and worth its weight in gold! It's a strange situation, he is me from 10 years ago. Asking the same questions, harboring resentment as I did (I'm guessing) about things that don't matter, worrying about not losing instead of winning. The most difficult thing for me is having the answer to the situation and not shoving it down his throat in a way that makes him feel dumb for his ideas. I've tried to include him by asking what he thought before I gave an answer but that only lead to him thinking I was testing him. Admittedly this is a "me issue" passed down from my father who made me feel less intellegent if I didn't always have the right answer or do the right thing. It's a terrible way to live and there is no room for error. There's also no room to experiment and grow and learn from mistakes. Before I get too far into my own psychological make up this quote really hit him. "I've learned there is no such thing as a business problem. There are only personal problems that effect your business" Damn that's so good!

Here's a link to the thread, it's a great read.
(NOTABLE! - Business is easy and it affects forum participation from heavy hitters. )

The actual problem was that he gave an employee under his management too much freedom to come and go as they pleased. No goals or targets were set. The employee did really well the first month. February was her second month and she barely showed up (Keep in mind this is a remote position, part-time). In Jan we received around 60k in (cash), but in Feb we brought in only 33k (cash). Hard to pay your bills when you take in less than 50% of what you bill for. I warned him about all of the things that would happen with this employee and how it would unfold and it played out just how I said it would. I believe the problem is the way I went about the problem. I had the answer but couldn't deliver it in a way in which it could be heard and understood by my partner. I also take pride when I'm right in a way that feels revengeful. All things for me to work on.

We're replacing the employee with a new person who will have guidelines and goals and accountability. I'm going to be taking lead on interviews and training the new employee while my partner watches. Hopefully, he can see what I do and try to do the same moving forward. I don't know if that will work out but we're going to find out. Gotta keep trying.

Anyway if this is more than you guys are interested in knowing or want to know different things that are going on feel free to let me know. I feel that the above quote is spot on for me so I wanted to share my personal problems I'm working on. Overall the business is doing really well and continuing to grow fast.

Currently reading: The great game of business. I hope to implement the ideas in the book to make a game for everyone to play together and win. So far it's a great read.

Other: I got a racing Sim (as a present for my birthday) and there is a reason I didn't buy it for myself. It's so much damn fun!
 

thechosen1

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you can't even say what type of businesses you ran when they are closed now?
Yeah this was the reason for my comment asking for more details. Not even an industry for the past businesses?
 

Johnny boy

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Yeah this was the reason for my comment asking for more details. Not even an industry for the past businesses?
We're all gonna steal his business :rofl:

I hate that shit. I'll tell all of you guys every single move I'm making because

1. I want to be the helpful guy that I DIDN'T have as a mentor. I had a 9-5 dad, shit teachers and a library card. I want to be the guy that outlines all of his businesses for everyone to see.
2. There's plenty to go around.
3. I'm the shit. Randy Johnson can tell you a fastball's coming and you're still going to miss. If you think telling internet strangers what business you're in is going to bankrupt you, you have NO confidence.

With that said, you have the right to privacy and it's your life, live it how you want. But what's the point of posting on here anyways then? Offer some value. We're on this site to improve our businesses and vague stories about "I made $xxx,xxx and here's what my feelings were during that time" does very little.
 

SPM_ENT

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We're all gonna steal his business :rofl:

I hate that shit. I'll tell all of you guys every single move I'm making because

1. I want to be the helpful guy that I DIDN'T have as a mentor. I had a 9-5 dad, shit teachers and a library card. I want to be the guy that outlines all of his businesses for everyone to see.
2. There's plenty to go around.
3. I'm the shit. Randy Johnson can tell you a fastball's coming and you're still going to miss. If you think telling internet strangers what business you're in is going to bankrupt you, you have NO confidence.

With that said, you have the right to privacy and it's your life, live it how you want. But what's the point of posting on here anyways then? Offer some value. We're on this site to improve our businesses and vague stories about "I made $xxx,xxx and here's what my feelings were during that time" does very little.
I don't think I've seen a more obvious example of someone trying to tear down someone else in order to build themself up.

If I told you I opened a bakery and then sold the bakery in order to open a factory to produce flower to sell to all bakeries in the land, it wouldn't change my story. The story is one of persistence and resilience, of self-reflection and improvement, it's one that shows money doesn't bring happiness. If someone is going through a hard time and reads this maybe they'll know that I got out of a really bad situation into a perfect situation and they can too. There is light at the end of the tunnel if you look for the good in things and find new opportunies using what you have already learned. That nothing you do is a waste as long as you're learning and keep going forward. It's a universal message because business concepts aren't industry-specific. It's the reason so many business books are written that apply across the board.

I'm really tired of the "I'm the shit attitude" and it's a really annoying part of this forum. If people need to come here and spend a ton of their time to prove how "cool" they are they must not be as successful as they say.
 

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Johnny boy

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I don't think I've seen a more obvious example of someone trying to tear down someone else in order to build themself up.

If I told you I opened a bakery and then sold the bakery in order to open a factory to produce flower to sell to all bakeries in the land, it wouldn't change my story. The story is one of persistence and resilience, of self-reflection and improvement, it's one that shows money doesn't bring happiness. If someone is going through a hard time and reads this maybe they'll know that I got out of a really bad situation into a perfect situation and they can too. There is light at the end of the tunnel if you look for the good in things and find new opportunies using what you have already learned. That nothing you do is a waste as long as you're learning and keep going forward. It's a universal message because business concepts aren't industry-specific. It's the reason so many business books are written that apply across the board.

I'm really tired of the "I'm the shit attitude" and it's a really annoying part of this forum. If people need to come here and spend a ton of their time to prove how "cool" they are they must not be as successful as they say.
Emotional cliché's are nice but not much else.

People click on the post to read it because they think "3 businesses? Damn, I could learn a thing or two that will help me in a practical and useful application for my own life".

I didn't call you unsuccessful, yet you want to throw that term back at me and then say "I'm tired of the cocky attitudes on here where people are tearing others down"?

Honestly though I'm just curious, because I see a lot of people on here doing the same thing...

Why do you not mention anything about your business/industry/strategies?


I don't understand it. The only reason I can come up with is that by doing so you are afraid of a potential risk or loss or losing a competitive advantage..is that the case?
 

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