Why $30M in Revenue Still Feels Unprofitable — Transcript

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1. 0:00My name is Lorien and I sell personal
2. 0:02finance courses and coaching to women.
3. 0:06>> For women?
4. 0:07>> Pardon?
5. 0:07>> For women?
6. 0:08>> For women.
7. 0:08>> Ah.
8. 0:09>> With a plus sign at the end.
9. 0:10>> the guys. They don't need to save money.
10. 0:11>> they can learn from someone else.
11. 0:13>> I'm messing with you.
12. 0:14>> Um uh so we do 30 million in revenue.
13. 0:17>> Badass.
14. 0:18>> Thank you. I would like to be at I don't
15. 0:21know revenue, which comes to my
16. 0:22question.
17. 0:23>> All right.
18. 0:23>> Um
19. 0:25and what is stopping me is our CAC to
20. 0:29LTV ratio.
21. 0:30>> Okay.
22. 0:30>> CAC is too high. Got the team working on
23. 0:33volume right now. Um LTV is too low.
24. 0:36>> Okay.
25. 0:37>> And AOV is too low on our front end.
26. 0:41>> Okay.
27. 0:42>> think it's actually a cash flow
28. 0:44>> Maybe.
29. 0:45>> cash restraint potentially, but I'm a
30. 0:47little I'm a little confused on where
31. 0:48like exactly to go to work.
32. 0:50>> Okay. How do you acquire customers right
33. 0:52now?
34. 0:53>> Uh primarily Meta.
35. 0:55>> So it's all paid ads?
36. 0:56>> Okay. So all paid ads and you're running
37. 0:58to what?
38. 0:59>> A webinar. Okay, webinar.
39. 1:00>> Okay. Are you Are you have a low-ticket
40. 1:02offer for the webinar?
41. 1:04>> Before
42. 1:04>> charging like something as like a
43. 1:05self-liquidating offer on the front?
44. 1:06>> Free webinar. No. Never done a
45. 1:08self-liquidating offer.
46. 1:08>> Okay. So free webinar on the front end.
47. 1:10You have a $2,000 offer. Okay. Then
48. 1:12what?
49. 1:12>> $2,000 or 12-month payment plan for $200
50. 1:16a month, which is why our AOV is like
51. 1:18$900.
52. 1:19>> Got it.
53. 1:19>> Um
54. 1:21and then acquisition cost like 1,500
55. 1:23>> Uh-huh.
56. 1:24>> on the client and then we have a back
57. 1:26end
58. 1:27>> Okay.
59. 1:27>> that's 10K, has a 7%
60. 1:30um upgrade rate. Yeah, it's low.
61. 1:32Outsourced sales team right now.
62. 1:35>> That's the
63. 1:35>> And um
64. 1:37so LTV's like 2,400.
65. 1:39>> Yeah. That's the problem.
66. 1:42>> Yes.
67. 1:44>> [laughter]
68. 1:44>> That's why I'm here.
69. 1:45>> ascension Yeah, I know. Your ascension
70. 1:46rate is too low.
71. 1:47Um
72. 1:48you will probably have to bring the
73. 1:50sales team in-house if you want to
74. 1:51really fix it. It's very hard to to
75. 1:53influence the team. You'll want the
76. 1:55ascension to be integrated into the
77. 1:57onboarding.
78. 1:57>> Mhm.
79. 1:58>> And so, you sell the $2,000 thing, you
80. 2:01have your onboarding call. The
81. 2:02onboarding call, the finish of the
82. 2:04onboarding call is they set their
83. 2:06goal-setting call
84. 2:07with what would become a setter.
85. 2:09>> Mhm.
86. 2:10>> Uh and then that setter sets for a
87. 2:12closer. So, they actually get three
88. 2:13calls. So, they have webinar, buy, they
89. 2:16have an actual onboarding call cuz you
90. 2:17want them like you want to make sure you
91. 2:18deliver.
92. 2:19>> One-on-one or that's a group call?
93. 2:20>> One-on-one. You can do Well,
94. 2:22you can start with uh
95. 2:23uh um
96. 2:25um
97. 2:25>> Group?
98. 2:26>> You can start with group and then you
99. 2:28will make more money if you go to
100. 2:29one-on-one. It is more ops, but like we
101. 2:31actually did this and I have a video
102. 2:33that breaks down everything that you
103. 2:34need to know.
104. 2:35>> Yeah, I've seen it.
105. 2:36>> Okay, yeah, yeah. And so, uh one-on-one
106. 2:38is better, but if you're going to start,
107. 2:39start with the the group. And their way
108. 2:41of getting off the call, like saying
109. 2:43like, "Okay, you're dismissed." is that
110. 2:45you show me that you have confirmed your
111. 2:47booking with your next call. So, that
112. 2:48way you have 100% through through line
113. 2:50to the next. Now, they're customers, so
114. 2:52they're going to show up. The
115. 2:53goal-setting call basically sits um for
116. 2:56who he like, "What's your goal? Cool.
117. 2:59What's the Basically, just do another
118. 3:00sales call again and then you push
119. 3:02people into the ones who can afford it
120. 3:04that makes sense uh into a closed call
121. 3:07with uh basically an invitation to join
122. 3:10something that has more help or work
123. 3:12associated.
124. 3:13>> Yes. Okay, great.
125. 3:14>> You'll probably need to get third-party
126. 3:15financing in place.
127. 3:16>> Oh.
128. 3:17>> Yeah, on front end.
129. 3:18>> on for the for the sales calls.
130. 3:20>> Yeah, and and front end.
131. 3:22Like you should definitely have some
132. 3:22BNPL options. So, buy now, pay later.
133. 3:24You should probably have a few.
134. 3:25>> Okay. We have them on the back end, we
135. 3:27don't have them on the front end.
136. 3:28>> Yeah. Um
137. 3:30Also, with the webinar, uh I would
138. 3:31recommend split testing the first 5
139. 3:33minutes.
140. 3:34So, retest two or three different intros
141. 3:37and look at LTV.
142. 3:38>> Yeah.
143. 3:39>> Um that uh will make you money.
144. 3:43Um but the biggest issue is that you're
145. 3:44you're upselling 7%. Like you need to be
146. 3:46at You want to be at at least 25 uh and
147. 3:49you should shoot for 50.
148. 3:50>> Okay. Okay, so just one more question.
149. 3:53As I'm that's like a longer term
150. 3:56solution, right? That's going to take
151. 3:58time
152. 3:58>> to bring the sales team in house and
153. 4:00really optimize that process.
154. 4:02>> Why does it have to be long-term?
155. 4:04>> Just the time it'll take to find a sales
156. 4:05leader and recruit and like shift leads
157. 4:08from the
158. 4:09>> You need to hire one person.
159. 4:11Really good sales director, and then you
160. 4:13hire six recruiting firms that do sales
161. 4:15and say, "I need 10 guys from each of
162. 4:16you." And you can get a 60-person team
163. 4:18in four like 2 weeks.
164. 4:20>> Okay.
165. 4:21Okay.
166. 4:22>> We just added 40 guys in 2 weeks to one
167. 4:23of our companies.
168. 4:25We just paid a bunch of like if if we're
169. 4:26doing that kind of volume, we're just
170. 4:28going to go to somebody who has a big
171. 4:29network of people they they're that's
172. 4:31their full-time business recruiting
173. 4:32sales guys. So it's like great, these
174. 4:34are requirements.
175. 4:35Go get them.
176. 4:36>> Yeah.
177. 4:37>> And I'm willing to pay for the speed. So
178. 4:38if it's And you can also negotiate if
179. 4:40you're doing multiple like the same of
180. 4:41multiple. So it's like, "Hey, normally
181. 4:42it you know, it's 10 grand per per head,
182. 4:45but I'm going to buy 20 from you. So
183. 4:48I'll do it for five."
184. 4:49>> Okay.
185. 4:49>> You pay 100 grand all of a sudden you
186. 4:50have a department.
187. 4:52>> Okay, cool. So an action on that
188. 4:54immediately and then while we're doing
189. 4:56the recruiting and getting that person
190. 4:58up to speed,
191. 4:59>> [laughter]
192. 4:59>> just keep spending basically as much as
193. 5:01we can afford to spend on the front end
194. 5:02to keep like lead flow coming into the
195. 5:05back end.
196. 5:05>> Realistically, if you spend less, you
197. 5:07will typically
198. 5:09ROAS will increase, typically.
199. 5:11Um YouTube's not that way though, kind
200. 5:14of random. Um the more you spend, the
201. 5:16more profitable it gets, so it's wild.
202. 5:17Yeah, it's the Anyways.
203. 5:20Um but all that's to say um I like if
204. 5:24you have a cash flow issue right now or
205. 5:26like, you know, it's like it's
206. 5:27self-inflicted. Like you can just spend
207. 5:29less
208. 5:30um and improve the improve the returns,
209. 5:32but your [clears throat] CAC is
210. 5:34appropriate.
211. 5:38$1,500 to acquire a customer in that
212. 5:40space.
213. 5:41Yeah, it's like you're not going to like
214. 5:43you're you're not going to get below
215. 5:441,000.
216. 5:46Yeah. and so this is a back-end issue.
217. 5:48Like you just have to
218. 5:50increase the ascension rate and that's
219. 5:52it. If you like this video and you're
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