What Actually Makes You Money? — Transcript

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1. 0:00I think you would you answered this
2. 0:01question which was how do you filter all
3. 0:03the information what's changing.
4. 0:05You answered it from the point where you
5. 0:08have already figured that out cuz now
6. 0:09you're like what should I make a video
7. 0:10on? You've already decided I should make
8. 0:13a video.
9. 0:14I don't think anyone's getting to that.
10. 0:17I think honestly most people are so
11. 0:19overwhelmed like should I learn Claude
12. 0:21code this new thing that's been buzzing
13. 0:23recently or should I learn
14. 0:25NFTs or crypto or
15. 0:28whatever.
16. 0:30How do you
17. 0:31trust that what you've decided on is the
18. 0:35right thing to do and that you don't
19. 0:36need to go back and check, you know?
20. 0:39>> I think what you just said was like the
21. 0:40the operative word that Sam said was
22. 0:42trust.
23. 0:43And so I think
24. 0:45the the scattered braininess comes from
25. 0:48a place of fear.
26. 0:50Is I'm afraid I'm going to be left
27. 0:51behind. I'm afraid my stuff's not going
28. 0:53to be relevant. I'm afraid if I don't
29. 0:55learn how to code I etc. etc. etc.,
30. 0:57right?
31. 0:59I have a belief. I trust that when
32. 1:03something is significant enough that it
33. 1:04actually affects my business, I will
34. 1:06change.
35. 1:08Until then,
36. 1:09I will continue to do what I know works,
37. 1:11which is that I will gather attention. I
38. 1:13will point it in a direction. I'll make
39. 1:15a compelling offer and then I'll deliver
40. 1:16on that promise.
41. 1:17And so fundamentally like especially
42. 1:19most of y'all here are are below a
43. 1:21million bucks ish, somewhere in that
44. 1:23neighborhood.
45. 1:26What makes you money?
46. 1:28Is letting people know about the stuff
47. 1:33and then delivering the stuff and making
48. 1:36the stuff you have to deliver. Those are
49. 1:38the only components of the business
50. 1:39because for those of you who have a
51. 1:41conversion mechanism that's automated
52. 1:42which is like the about page, there's no
53. 1:44like real sales motion. You just point
54. 1:45it there. If you do have a sales motion,
55. 1:47you have a sales call or you do a
56. 1:48webinar or whatever, you'll have that
57. 1:49extra step that's in there. But that is
58. 1:51usually a very curated. You don't need
59. 1:54to remake your sales script. You don't
60. 1:55need to remake your webinar once you
61. 1:57know this is the thing that converts.
62. 1:58That's just kind of like a performance
63. 2:00that either gets auto you know automated
64. 2:01or you just do it on a weekly basis or
65. 2:02whatever. But what are the inputs and
66. 2:04the outputs of the system? The inputs in
67. 2:06the system are more people knowing about
68. 2:08the stuff, which means paid ads and
69. 2:10content by and large for most of you
70. 2:12guys. That's the input.
71. 2:14We have this automated conversion for
72. 2:16many of you. And then delivery also for
73. 2:18many of you is relatively leveraged in
74. 2:21that like there's recordings and maybe
75. 2:22you do one call a week if you have 10
76. 2:23times the people on that call, so it
77. 2:24probably works pretty okay. And so
78. 2:27pretty much everyone here should be
79. 2:29spending the lion's share of your time
80. 2:31promoting.
81. 2:33And I don't say like in a chilly way.
82. 2:34I'm saying like
83. 2:36let people know about your stuff and do
84. 2:38it in a and go two levels deeper. Spend
85. 2:40more time on the problem
86. 2:42in and then let that come out in the
87. 2:44content or the ads and that's what's
88. 2:46going to to create the differentiation.
89. 2:49So yes, like right now my my my simple
90. 2:52advice is if you have I don't know what
91. 2:54let's assume you work a 12-hour day, you
92. 2:56can shrink it down to whatever hours you
93. 2:57work. And we have the French guy who is
94. 2:58like I don't like working with him four
95. 3:00hours a week. Uh
96. 3:01it's too much.
97. 3:04So yeah, right. Shrink that down
98. 3:05according to you. But I just like first
99. 3:07four hours a day I'm promoting.
100. 3:10Uh next four hours of the day I'm I'm
101. 3:12building the stuff and then last last
102. 3:14one I'm I'm delivering
103. 3:16the stuff that I built.
104. 3:18That's that's the it just third third
105. 3:20third. And just set a timer and stick to
106. 3:22that block. Like don't like have like
107. 3:25some fire ca- like you have if you know
108. 3:27what you do every day cuz it shouldn't
109. 3:28be a surprise to you. There's slacks,
110. 3:30there's decisions, there's whatevers.
111. 3:32But many of you guys don't have like
112. 3:33massive teams you have to deal with
113. 3:34either. And so like
114. 3:36if it's not that
115. 3:38it is a distraction.
116. 3:40And so if you think about fo- like what
117. 3:41is focus?
118. 3:42Focus is
119. 3:44doing
120. 3:45ev- is doing one thing.
121. 3:47Which means that anything that's not
122. 3:48that thing is less focused. Like the
123. 3:50most focused video game player would not
124. 3:51sleep, would not eat, would only play
125. 3:52video games. As soon as they introduce
126. 3:54any activity that's not playing video
127. 3:55games, they become a less focused video
128. 3:57game player. Now, you can't be 100%
129. 3:58focused cuz you'll die cuz you need to
130. 4:00drink water, you need to eat food. So,
131. 4:01it's like, "Okay, well, what degrees of
132. 4:03not focus can I introduce into the
133. 4:04system?" But fundamentally, that is it.
134. 4:07Like, the ultimate productivity hack is
135. 4:08no.
136. 4:12>> Is this You seem to understand this
137. 4:14problem, right?
138. 4:15Are we getting it it like the Are we
139. 4:18>> Oh, good.
140. 4:19Go ahead.
141. 4:20>> Why do you think these people are just
142. 4:21endlessly scrolling and not doing
143. 4:23anything? Like, what is going on in
144. 4:25their mind?
145. 4:26>> You talk about consumers?
146. 4:28>> Just You seem to know what we're talking
147. 4:30about. Like, people do this. They
148. 4:31They're trying to figure out what's
149. 4:32going on, what should I do, and they
150. 4:33never quite figure it out cuz every day
151. 4:35it changes, right?
152. 4:36>> Right.
153. 4:37>> And so, they never are like, "I'm This
154. 4:38is it. I'm going to do this, and I'm
155. 4:39going to ignore everything, and I'm just
156. 4:40going to do it."
157. 4:42They don't do that. Like, why not?
158. 4:45>> I think
159. 4:46just speaking from personal experience,
160. 4:47we try to learn as much as we can
161. 4:50>> Mhm.
162. 4:50>> and consume as much as we can, and then
163. 4:52we listen to somebody who's a YouTube
164. 4:53expert that says, "Do this." Then we
165. 4:54listen to a copywriter that says, "Do
166. 4:55this."
167. 4:56>> Mhm.
168. 4:56>> And at the end of the day, I know deep
169. 4:57down that everything does work if you
170. 4:58just do it for long enough and get good
171. 5:00at it.
172. 5:01>> Yeah.
173. 5:01>> But we we get into this circle of trying
174. 5:04to learn as much as
175. 5:05>> to do this sort of thing?
176. 5:07I used to do more of it. Not Not like to
177. 5:09this extent.
178. 5:10>> I was like
179. 5:12>> But you read books in like
180. 5:14>> Yeah. Yeah. Yeah. Yeah.
181. 5:15>> But I would say
182. 5:15>> I read books around specific problems,
183. 5:17though, to be real.
184. 5:18>> But I remember you saying something,
185. 5:19too, where it's like you were reading
186. 5:20all these self-help books.
187. 5:21>> Oh, that's before I started business,
188. 5:22yeah.
189. 5:22>> But even just in general, the concept of
190. 5:24reading all these self-help books and
191. 5:26and at some point, they all end up
192. 5:27contradicting each other.
193. 5:28>> Oh, totally.
194. 5:28>> And you're like, "Oh, I'm in the same
195. 5:29exact spot. I just need to [ __ ] pick
196. 5:31one and and do it." But I think picking
197. 5:33that one gets tougher
198. 5:35a lot of us.
199. 5:35>> I'll I'll give you a a a wonderful piece
200. 5:37of advice that even very high-level
201. 5:38entrepreneurs will forget. So, it's
202. 5:40something we need to be reminded of more
203. 5:41than taught. But it's like, you will do
204. 5:43something, and as soon as it begins to
205. 5:45work, do not stop doing that thing until
206. 5:47it stops working. Do not stop doing that
207. 5:49thing because you fear it will stop
208. 5:50working. Do not stop doing that like if
209. 5:52it keeps working, you keep doing it.
210. 5:55>> Mhm.
211. 5:55>> Repeat successful actions. That was
212. 5:57success. We should repeat that. We
213. 5:58should do that again. We did it
214. 6:00yesterday. Do it again. Aren't they
215. 6:01tired of it? Did it work? Yes, do it
216. 6:03again. I'll I'll tell you the most
217. 6:04extreme version of this and like why I'm
218. 6:06like So, I did the book launch, right?
219. 6:08The second day, there's all this juju
220. 6:11about like
221. 6:13you have to have a a repeat pitch is a
222. 6:15different presentation, all this type of
223. 6:18stuff.
224. 6:19I I was so added about this that I was
225. 6:21like, no, I think I can give the exact
226. 6:23same presentation again.
227. 6:26Same exact presentation and more people
228. 6:28will buy. Because I believe that it is
229. 6:30about asking again.
230. 6:32More like it worked, so I will do it
231. 6:33again. And so, I did the exact same
232. 6:35presentation day two and we had did like
233. 6:37$25 million in sales day two.
234. 6:40Same presentation. Now, you're like, but
235. 6:41would it be different people? Tons of
236. 6:43the same people.
237. 6:45They just watched it again.
238. 6:47We watch reruns
239. 6:49of shows that we already know happened.
240. 6:51And we think, oh, we have I I have to
241. 6:53somehow come up with a new business
242. 6:54model every week. If you have something
243. 6:57and it works and you make money from it,
244. 6:59then you have an input-output equation.
245. 7:01And so, then it's like, great.
246. 7:03The real question becomes, how can I
247. 7:05actually do 100 times the inputs? Now,
248. 7:08part of that comes from work ethic. The
249. 7:10other part comes from leverage. What
250. 7:11kind of systems can I put in there so
251. 7:13that this one piece of content gets put
252. 7:14in 10 places? That kind of stuff. But
253. 7:16like
254. 7:17school has one of the simplest business
255. 7:19models in the world. Promote [ __ ] point
256. 7:21to page, ching deliver [ __ ]
257. 7:25>> And I repeat the [ __ ] out of that on
258. 7:26every single
259. 7:27>> [laughter]
260. 7:28>> I'm like, look, they have a Instagram,
261. 7:31link in bio, about page, money.
262. 7:35>> Yeah.
263. 7:35>> [laughter]
264. 7:37>> Again and again and again and again and
265. 7:39again and everyone's still like, what do
266. 7:40I do?
267. 7:40>> Yeah.
268. 7:41>> Yeah.
269. 7:41>> But it's the So, like it's So, when we
270. 7:43look at that, which of those has volume?
271. 7:46The conversion is there's no real volume
272. 7:48there. Maybe there's a split test, if
273. 7:49that. The delivery, most of you guys
274. 7:51have fixed delivery in that it's like I
275. 7:53do a call a week. I do some sort of Q&A
276. 7:55or breakdown or review for a pickup guy
277. 7:57or I do a a page breakdown for Evelyn or
278. 7:59an ads breakdown, whatever, right?
279. 8:01That's it's a fixed backend. It's an
280. 8:03automated conversion. The only thing the
281. 8:06only part of the system that actually
282. 8:08you have to do is the input.
283. 8:11Is the ads. And when I say ads, I mean
284. 8:12in the formal sense, it's advertising,
285. 8:14letting people know about stuff. That
286. 8:14means content and paid. And now that
287. 8:16content and paid are merged, it's just
288. 8:18content.
289. 8:20And finding the good content and then
290. 8:21putting more money behind it so more
291. 8:23people see it.
292. 8:24That's it.
293. 8:25>> Traffic, conversion rate, churn. Like
294. 8:28one of those things
295. 8:30might be the problem.
296. 8:33Maybe all.
297. 8:35>> Maybe all.
298. 8:36>> But, I swear most people don't even
299. 8:38start it. So, yeah. But, we've talked a
300. 8:41bit about this, too. It's like maybe it
301. 8:43this term for it is too nerdy, but like
302. 8:45first-party data.
303. 8:46>> Mhm.
304. 8:46>> Cuz I was telling Alex Hormozi once in
305. 8:48one of our calls that I was like, "Shit,
306. 8:50I don't even know when the last time I
307. 8:51read a book was."
308. 8:52>> Yeah.
309. 8:53>> It was like 2 years ago.
310. 8:55Which seems crazy, right? If But
311. 8:58um we know we know as younger and I
312. 9:00didn't know what was going on, I would
313. 9:02read a lot and I would take a lot of
314. 9:04course, I would consume a lot.
315. 9:07And that's because I didn't have
316. 9:09anything to do
317. 9:12to test if it worked or not. I was
318. 9:14trying to figure out what I should do,
319. 9:16right? So, I was like all over the
320. 9:17place.
321. 9:18And then when I finally figured out,
322. 9:20"Okay, I'm going to do this." Then I did
323. 9:23it and then if it worked, I would be
324. 9:24like, "Okay, now I'll just make it keep
325. 9:26working." Or and if there's a problem, I
326. 9:28will seek information to solve the
327. 9:30problem.
328. 9:32And then I was consuming less, but then
329. 9:34the more I got the further on I got, the
330. 9:36less
331. 9:37the more first-party data you have from
332. 9:39doing it. And that's obviously so much
333. 9:42more accurate and relevant to you than
334. 9:44third-party data, which is other people
335. 9:47cheering
336. 9:48what they think worked for them.
337. 9:51Do you Do you see what I'm saying?
338. 9:53Yeah. And I think that
339. 9:56once you get that first-party data, you
340. 9:58can totally tune out a lot of things.
341. 10:01Like, you can tune out everything that's
342. 10:03going on because none of that if that
343. 10:05matters, it will touch the
344. 10:08first-party data. Right? Like, you'll
345. 10:10see a movement and you're like, "Oh,
346. 10:11maybe that is important." But, if it
347. 10:13doesn't, who cares?
348. 10:16And is this making any sense?
349. 10:18>> I endorse this message.
350. 10:20>> I love figuring out the my favorite
351. 10:22thing to do is like
352. 10:24I can completely ignore that. I don't
353. 10:26give a [ __ ] Like, that is what I'm
354. 10:27trying to do to everything, basically,
355. 10:29because I'm trying to figure out what
356. 10:31can I ignore.
357. 10:33Um
358. 10:35and I try to ignore a lot, really.
359. 10:38And I start
360. 10:40Should I repeat?
361. 10:41>> Yeah.
362. 10:41>> It's signal versus noise. Regarding the
363. 10:44the earlier question, finding out what
364. 10:46is signal, what is noise. And once you
365. 10:48get more first-party data, the signal
366. 10:50becomes stronger, the noise becomes
367. 10:52smaller, right?
368. 10:53>> Yeah, you'll do stuff and then either
369. 10:56your
370. 10:57conversion rate will be a problem and
371. 10:58then you consume a YouTube video about
372. 10:59conversion rates and you're like, "Okay,
373. 11:01that gives me like six things to try."
374. 11:03And until you try the six things,
375. 11:04there's really no point in consuming
376. 11:06more stuff cuz you just need to try the
377. 11:07six things. And I will say
378. 11:10Leila says this a lot, which is just
379. 11:12like a great reminder for me, which is
380. 11:13like, "Don't change things when a
381. 11:15solution is on the way."
382. 11:18So, like, we will we'll be mid split
383. 11:21test on a price thing and be like, "Man,
384. 11:23our churn is a problem." It's like we're
385. 11:25we're running the test right now.
386. 11:27So, why should change It's like, "Dude,
387. 11:29we're we're mid flight." Like, unless we
388. 11:31land the until we land the plane, if we
389. 11:33change mid-flight everyone dies. It was
390. 11:34complete waste. And so, some things just
391. 11:37take time. Is that you just have to let
392. 11:38a certain number of repetitions, certain
393. 11:40number of posts, certain number of
394. 11:41whatever occur, so you can actually get
395. 11:43feedback on that data. Which I think is
396. 11:45the second once you get into the
397. 11:46first-party world, that becomes the next
398. 11:47issue. It's like you want to try too
399. 11:49many things even with the data that you
400. 11:51have, and then that's where strategy
401. 11:52becomes important because strategy is
402. 11:53part of a session of resources, right?
403. 11:55And so, you have 20 I mean, how big I
404. 11:57mean, the the school list of like things
405. 12:00that we can do with the platform is
406. 12:01longer is very long.
407. 12:03>> There's
408. 12:032,000 new ones each day.
409. 12:06From you guys, thank you.
410. 12:08>> [laughter]
411. 12:08>> And so, you have to pick. And so, that
412. 12:10to be fair like that at the absolute
413. 12:12core, in my opinion, is the core of
414. 12:14entrepreneurship. Is being able to
415. 12:16choose. I have these very limited
416. 12:18resources in time, money, energy, and
417. 12:20there's a hundred things I can do, but
418. 12:22which of these hundred things that if I
419. 12:23were to implement has the highest
420. 12:24likelihood of yielding the biggest
421. 12:25outcome?
422. 12:26>> For most people, you don't have enough
423. 12:28data for it to even make sense.
424. 12:30>> Let me ask again.
425. 12:32>> That's why it's not a feature in School,
426. 12:34by the way.
427. 12:35>> Uh you know, you're not going to
428. 12:36implement AB testing for about page?
429. 12:38>> It's just not worth it because we see
430. 12:40how much traffic most people get, and we
431. 12:42see how schizophrenic their behavior is.
432. 12:45>> [laughter]
433. 12:46>> And
434. 12:48we see people think that their about
435. 12:50page change bombed after five clicks,
436. 12:52right? Like
437. 12:54and they change it four times in a day
438. 12:56with like 20 clicks, and I'm like
439. 12:59and they want to AB test it. I'm like,
440. 13:01no.
441. 13:02>> [laughter]
442. 13:03>> You need to leave it alone for at least
443. 13:05a week with your amount of traffic,
444. 13:07right?
445. 13:08And I've got this method I use, and I
446. 13:10still use it internally at School. We
447. 13:11don't even run a lot of AB tests, and
448. 13:13we've got a shitload of traffic, right?
449. 13:15I call it cowboy testing.
450. 13:18And I just change it and watch the
451. 13:20number to see if it goes up or down.
452. 13:23And a lot of the time
453. 13:25a lot of the time I can get away with
454. 13:27that [ __ ]
455. 13:28>> [laughter]
456. 13:29>> And when it's more sensitive, like very
457. 13:31sensitive, I'll run an AB test and
458. 13:33properly set it up.
459. 13:35And I'm still continuously amazed at how
460. 13:37hard it is to make something that can
461. 13:38beat the control.
462. 13:40That um
463. 13:42I think most people don't really
464. 13:44understand
465. 13:46the
466. 13:46the actual underlying mechanics of an AB
467. 13:49test.
468. 13:50And if you don't understand that, you're
469. 13:51just going to create more noise.
470. 13:53>> We ran 16 AB tests on the school games.
471. 13:5614 of them lost.
472. 13:59>> I'll put it this way. This is another
473. 14:00way to look at it, right? So, we've got
474. 14:01the sign-up page for school. We send an
475. 14:03enormous amount of traffic to that page.
476. 14:04So, it's obviously very important.
477. 14:07We have tried so hard to like make it
478. 14:09better. Most of the time, we make it
479. 14:11worse in an AB test, right?
480. 14:13However, if we try a different random
481. 14:16creative on Meta, it can work five times
482. 14:19better.
483. 14:20So, like the leverage in the creative is
484. 14:22so much more powerful than the leverage
485. 14:25on the the page. It's insane.
486. 14:29>> I think Okay, this is a I want to
487. 14:31continue down this.
488. 14:32The earlier on in the funnel that you
489. 14:34are, the bigger the leverage is in terms
490. 14:37of the throughput. So, if you change
491. 14:39your your CTRs on your ads from 1% to
492. 14:412%, you double the whole business.
493. 14:45For you to do For you to you're probably
494. 14:47not going to double the conversion on
495. 14:48your page. It's just It's just very
496. 14:49unlikely. You might get a 10% or 20%
497. 14:51lift, maybe if it's a really good, you
498. 14:53know, improvement. But, you could But,
499. 14:55the crazy part is like you absolutely
500. 14:56can
501. 14:57get a double or a triple in conver- in
502. 14:59in CTR on the ad side. And that can get
503. 15:02paired with if it's a really good
504. 15:03creative, you might get double or triple
505. 15:04the conversion rate, and your CPMs might
506. 15:06be 1/6 of what they are. And so, all of
507. 15:09a sudden, you have an 18x improvement,
508. 15:11and there's just nothing down funnel
509. 15:12that gets you that kind of gain, besides
510. 15:14maybe a 10x or 20x in price or something
511. 15:16like that. But, like for the actual
512. 15:17mechanics, it's very rare. And so, like
513. 15:20these are the biggest levers in the
514. 15:21business. They're going to be price all
515. 15:22the way at the end cuz you can you can
516. 15:24make that kind of change and then the
517. 15:26the pure volume of creative on the
518. 15:28front.
519. 15:30>> Most people don't have about page
520. 15:32conversion problems. It's what we see is
521. 15:34they mostly need more traffic or they
522. 15:36need a fixed churn.
523. 15:37>> Yeah.
524. 15:37>> Um
525. 15:38But, you know, if your about page
526. 15:40doesn't convert, you do have an about
527. 15:41page problem and that is possible. Um
528. 15:45>> Uh so, for for example, uh we had
529. 15:47monthly subscription which is $9 and
530. 15:50then we added premium and it was only
531. 15:52yearly price uh for $77 and our
532. 15:55conversion to yearly rate was like 20%
533. 15:58and then we add VIP which was 24 $249
534. 16:03per year and we we thought that oh we
535. 16:06going to increase the
536. 16:07uh the RPU, but uh our premium
537. 16:11conversion rate dropped to 5% because we
538. 16:13added third tier. So, my point was like
539. 16:17I want to test like different types of
540. 16:19uh about page. Uh so, one of them like
541. 16:21just uh
542. 16:23uh normal and uh premium and the the
543. 16:25second one is just for VIP, for example.
544. 16:28>> Can you Can you cowboy test it?
545. 16:30>> I think you just did.
546. 16:32>> You see you know what works better?
547. 16:35>> Uh no, I mean if I got two tiers, the
548. 16:38uh conversion to premium is really high,
549. 16:40but if I run three tiers, that so the
550. 16:42conversion to premium is uh is not so
551. 16:44good.
552. 16:45>> So, which one works better?
553. 16:46>> The first one, but I already got a lot
554. 16:48of VIP people in the group rate.
555. 16:51>> Maybe do the first one.
556. 16:53>> Uh so, what should I do with the people
557. 16:55who already bought the VIP for yearly?
558. 16:57>> I don't know.
559. 16:59Um keep keep them or cancel them,
560. 17:01whatever you want.
561. 17:05>> Also, to his point, first party data.
562. 17:08>> [clears throat]
563. 17:08>> Right? Like you can you can read like
564. 17:10hey having a high anchor works in a lot
565. 17:11of scenarios. In yours it didn't.
566. 17:14Good to know.
567. 17:15>> [laughter]
568. 17:18>> Real quick, I'm going show you the exact
569. 17:2010-stage roadmap from zero to 100
570. 17:22million plus
571. 17:23that less than 1% of companies finish,
572. 17:25I've now done multiple times, and so I
573. 17:27can say with a lot of confidence that
574. 17:28these are the stages as headcount
575. 17:30increases that you need to get through.
576. 17:32And I broke each of these down by eight
577. 17:34different functions of the business,
578. 17:36what the constraint feels like, like
579. 17:37what are the symptoms of it when you're
580. 17:39going through it, and then what steps we
581. 17:40actually took to graduate. And we've
582. 17:41done this across software, physical
583. 17:43products, uh service businesses, brick
584. 17:46and mortar, all of this, and it works.
585. 17:48And it's my gift to you, it's absolutely
586. 17:50free. And so the link's in the
587. 17:51description, but you just go
588. 17:52acquisition.com/roadmap,
589. 17:54just enter your info, and it'll spit it
590. 17:55right back to you all free.