Why a Side Project Can't Beat a Focused Competitor — Transcript

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1. 0:00All right, I got Jax McGee. What's up?
2. 0:02>> Hey G.
3. 0:03My name's Angelo. I sell pizza, so
4. 0:06sauce, cheese, and pepperoni to humans.
5. 0:08>> This is what we need to get on.
6. 0:11>> Uh we do 4.2 a year, run about 30%
7. 0:14margins.
8. 0:15I'm going to be vulnerable here. I would
9. 0:17like to be at W revenue.
10. 0:20Can I skip that? Can I go down?
11. 0:22>> Sure.
12. 0:23So, what's stopping you? So,
13. 0:26>> I'm kind of the cool kid back home.
14. 0:27>> Okay.
15. 0:28>> I'm as a leader. I don't work at my
16. 0:30stores. I have full capacity.
17. 0:32>> How many stores?
18. 0:33>> Uh three.
19. 0:33>> Okay.
20. 0:33>> Three stores. So, I have I have great
21. 0:36teams. Everything's in place. I have
22. 0:38opportunity to scale, unlimited
23. 0:39checkbook, all the things.
24. 0:40>> Yes.
25. 0:41>> During the process, when I bought my
26. 0:43time back, I was like, what am I going
27. 0:45to do to make the business money?
28. 0:46>> Uh-huh.
29. 0:47>> So, I built a tool, and I just And
30. 0:49that's how I run my business.
31. 0:50>> Uh-huh.
32. 0:51>> So, other humans want the tool now. So,
33. 0:53I was invited to a $350 million company.
34. 0:55It was like, "Hey, what are you doing?"
35. 0:57So, then I showed them. So, now other
36. 0:58humans want the thing. So, it's Do I
37. 1:00continue to do pizza? Or do I do the
38. 1:02tool? Not the woman in the red dress.
39. 1:05It's kind of like
40. 1:06humans like the thing that I built in
41. 1:09It's kind of cool.
42. 1:10>> Yeah.
43. 1:11Um
44. 1:15What do you want to have happen with the
45. 1:16tool?
46. 1:17>> I want to I want to help people. The
47. 1:19pain that I've went through, I want to
48. 1:21help others with no expectation.
49. 1:25The thing that I did to get to where I'm
50. 1:26at is in an app.
51. 1:28>> Mhm.
52. 1:34Um
53. 1:40What does it do?
54. 1:42>> Uh
55. 1:43Simply uh I actually essentially what
56. 1:45you did with GymLaunch.
57. 1:47>> Okay.
58. 1:48It's like a CRM?
59. 1:50>> Uh yeah. Um it's more of an operating
60. 1:52system, yes.
61. 1:53>> Yeah, like a pizza OS.
62. 1:54>> Yeah, actually. Yeah. Yeah, there you
63. 1:56go. Yep.
64. 1:58Um
65. 1:59Would you process payments through this?
66. 2:01>> With Stripe, we could, yes.
67. 2:03>> Okay.
68. 2:04Um
69. 2:06Well, would So, we got to go back to W
70. 2:09revenue.
71. 2:10>> Mhm.
72. 2:10>> What do you want to have happen?
73. 2:12>> What do I want to happen?
74. 2:13>> Uh-huh.
75. 2:14>> So, with the revenue in in pizza,
76. 2:16I'd I'd just go buy 10 units when I get
77. 2:18home and do the thing. So, over on this
78. 2:19side, I'm just
79. 2:21I just don't know what I don't know.
80. 2:23>> Well, let's level up a a minute. So,
81. 2:25what
82. 2:26what do you want to have happen like
83. 2:28business outcome-wise?
84. 2:30>> Okay, for the new thing.
85. 2:31>> For everything.
86. 2:35Cuz there's multiple ways up the
87. 2:36mountain.
88. 2:36>> Mhm.
89. 2:37>> So, you could option A, forget about the
90. 2:39tool.
91. 2:40>> Mhm.
92. 2:41>> Uh and well, not forget about it. Just
93. 2:43use the tool for yourself.
94. 2:44>> Mhm.
95. 2:44>> And just run your own stores and buy
96. 2:47stores for nothing cuz pizza stores are
97. 2:48very easy to buy for basically nothing
98. 2:50and basically turn them around and then
99. 2:52have a big chain of pizza stores. Your
100. 2:55edge is that you have this operating
101. 2:56system that no one else has.
102. 2:58That becomes a very valuable and
103. 2:59sellable business. For sure.
104. 3:00>> Sure.
105. 3:01>> Option one. That can That can get you a
106. 3:03very big outcome.
107. 3:04>> Mhm.
108. 3:06>> Option two, you
109. 3:09take your take your tool and
110. 3:12uh
111. 3:13>> [laughter]
112. 3:14>> you take Pizza OS, right? Um and we
113. 3:18build a different model around it. And
114. 3:20so, there's a lot of other models you
115. 3:20can have with a you know, SaaS tool like
116. 3:22that that is
117. 3:23uh CRM-slash-payment,
118. 3:25you know, centric.
119. 3:26>> Mhm.
120. 3:27>> Um
121. 3:28there's kind of a turnaround business
122. 3:30where you can let all pizza stores start
123. 3:33for free and they will process their
124. 3:35pizza through your thing. And then, for
125. 3:37people who are doing real revenue, you
126. 3:39can say, "Hey, I can help you out." And
127. 3:40then, you get a percentage of the
128. 3:41revenue.
129. 3:42That's a very light model that could
130. 3:44still have tremendous enterprise value.
131. 3:46That's called like option two.
132. 3:48Um
133. 3:50option three is that you do that. Um but
134. 3:53the thing is is that you and then you
135. 3:54just go full software, right?
136. 3:57Uh
137. 3:57You It's a very different life than you
138. 3:59have now.
139. 4:00So, you'd have to be prepared to like
140. 4:02you're no longer a pizza guy, you are a
141. 4:05software founder.
142. 4:06>> It's what I feel like. And to answer
143. 4:07your question, what
144. 4:09what you did for all of us in this room,
145. 4:12I feel joy knowing that I can do that
146. 4:14for others. Right? So, that
147. 4:16that does feel like the way I want to
148. 4:18go.
149. 4:18>> Okay.
150. 4:18>> Pizza's kind of like
151. 4:20>> Cool.
152. 4:20>> Yeah. Uh leadership, influence,
153. 4:22standards, hard work, paying ignorance
154. 4:24tax. And I accidentally created a thing
155. 4:27cuz nobody had it, so I just created it.
156. 4:30And here we are, so.
157. 4:31>> I think um
158. 4:34I'm going to give you two things. So,
159. 4:36one, I I think either opportunity could
160. 4:38make you as much money as you want.
161. 4:40Either way. You could have 100 pizza
162. 4:41stores and make a lot of money that way,
163. 4:43use your tool, or you use the tool and
164. 4:45do some sort of call it franchise light,
165. 4:47or you could franchise heavy it and use
166. 4:48the tool. Either way, some version of
167. 4:50B2B to that.
168. 4:51What uh the second thing, so my
169. 4:55my advice is that you'll win either way
170. 4:56because winners win. And so, it's really
171. 4:58what path up that on you want. You're
172. 4:59going to get there either way.
173. 5:00This thing one. Thing two is that the
174. 5:02view's going to be the same.
175. 5:05The view's going to be the same.
176. 5:07And so, right now, Pizza School cuz you
177. 5:08figured it out.
178. 5:09You'll figure this one out, too.
179. 5:11And a high enough level, you'll have a
180. 5:12head of marketing, you'll have a head of
181. 5:13sales, you'll have a head of head of IT,
182. 5:14you'll have legal You'll have
183. 5:16employees, sleeping with employees.
184. 5:19Same
185. 5:20It's the same everywhere. You're
186. 5:21going to have the same five seven people
187. 5:22who are going to report into you. And if
188. 5:24you build it all the way up in either
189. 5:25level, you're going to have the same
190. 5:26caliber people reporting to you. And so,
191. 5:28you're not you're not going to be in the
192. 5:29pizza business. If you're in the pizza
193. 5:30business, you're going to be in the
194. 5:30people business. And if you're in the
195. 5:31software business, you're not going to
196. 5:32be in the software business, you're
197. 5:33going to be in the people business.
198. 5:35So, it's up to you which one you want to
199. 5:37do. I think at the end they end up
200. 5:38converging.
201. 5:39So, I think right now it just looks
202. 5:41different, and different's always fun.
203. 5:43But at the end of the day, you could
204. 5:44take both up the mountain. And it's an
205. 5:45entirely a you choice. I think you'll
206. 5:47win either way and given how it seems
207. 5:49like you've outsourced the pizzas,
208. 5:51I would say if you are going to pursue
209. 5:52the other path to sell the stores.
210. 5:57Because you need all your focus on it
211. 5:58cuz the people who are going to try and
212. 5:59compete against you are for sure going
213. 6:00to be focused on.
214. 6:02And I think out of respect to the
215. 6:03competition,
216. 6:04you should not expect that you're going
217. 6:05to beat them with one arm tied behind
218. 6:06your back.
219. 6:09Very helpful.
220. 6:10Rock and roll. Appreciate it. If you
221. 6:12like this video and you're a business
222. 6:13owner who wants to break through your
223. 6:13current revenue ceiling, I distilled
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225. 6:17past 10 million and three businesses
226. 6:19past 100 million into a completely free
227. 6:21scaling roadmap that I've used to go
228. 6:22from zero to one, zero to 10, and zero
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233. 6:30enjoy.