Was Ziele lohnenswert macht, mit Dave Ramsey

0:00So, what makes something worth pursuing versus what makes something a no? Is it just it's on mission? Because I would imagine that there's you've resource constraints. You can't do everything that you would love to do. So, what what makes something quote worth doing versus not worth doing? Well, these days we we are are much better. In the old days I was just we just did it. I mean, it was like stupid. It was just stupid. And uh but nowadays we actually do run a beta on something and we look at the ROI's and we look at the customer acquisition cost, the ROAS, and so forth. And we're looking at um you know, the is is this a good use of our bandwidth, of our marketing bandwidth, of our um of our leadership time frame, you know, the time invested.

0:44Um o- overhead committed to this project. And so, uh I mean, we can you know, we we drop a lot of stuff in the test bucket. And uh but if it doesn't if it's not going to have a great ROAS, if it's not going to have a great conversion, and if it's not going to have a great margin when we're done, uh we can't afford to do it because of opportunity cost. Uh we can afford financially to do it, but but the the missed opportunity on something that was working 10x of what this little thing that we fell in love with over here but sucks, um you know, we have to just let the thing that sucks die and uh it didn't make it out of the test tube.

1:22That's all it amounts to. You take more of a a test test quickly lots of ideas kind of strategy and if something something hits, then it's then you double down on those things. So, that's kind of how you think through kind of new product or expansion of kind of like profit profit centers I think is what you said. Exactly. Or and or can can we you know, can we iterate it five or 10 degrees and cause it to work? I don't we don't kill everything instantaneously. But I mean, if we're going to invest even enough to get it into the test tube, we're going to we're going to iterate iterate iterate before we kill it. But when we lose hope that the thing is going to have have a scale or have a margin that that is commensurate with the with the resources committed as you said that then you know when we lose that hope we've got to be grown-ups and go I really like this thing but it just it's not it's not it's not good business. So with these new endeavors the first thing I wrote down when you started when you when you when you when you brought it up was was who does new?

2:19And the reason I bring this up because I would imagine a lot of business owners have many ideas you know you said it there earlier I do like shiny objects like go this looks exciting this looks exciting this looks exciting but for something to work you typically have to have talent overseeing it and I would imagine at the point that you're at now you're probably not overseeing each of these kind of new profit centers or new ideas maybe they're you know brought to you and you review the metrics but you're not really driving unless you are in which case this is an open question.

2:43Who who does new? Because are you going to take resources from something that's working are you bringing somebody new in or do you have a specific testing department that's all they do and then they hand it off to somebody else like can you walk me through that process? Probably a a hodgepodge of a little bit of all of that. I don't do it no. Um but but what we have created is this collaboration uh freedom uh for anybody to throw an idea on the table.

3:12Uh and then you got to defend it. Uh you got to make a case for it. Um and and so you can't just throw it out there and go well you guys go do that now cuz I'm so smart I came up with it cuz ideas are dime-a-dozen people who can implement them are the problem. Right. Any one of the profit centers for instance EntreLeadership okay so it's got several components to it it's got a digital component EntreLeadership Elite which is a digital coaching product for small businesses right? So if somebody comes in and says I got a great idea to add something a tool to that digital product or whatever that's usually going to bubble up somewhere in that EntreLeadership team.

3:46From that that the vice president who's running that Jason or Um, you know John Felkins our senior coach over there so he's got a lot of coach him and his coaches there on the front lines. They're they're interfacing with the customer all the time. The customer's going to throw needs at them. They went, "Okay, we need to serve this need. How can we do that? Is that a digital thing? Is it a a coaching need? How are we going to fill?" So, fill the need, fill the need, fill the need from an entrepreneur's perspective. But, what we do is we give a lot of power to the vice president of that particular business unit uh or sub business unit uh to bubble things up. And then on top of that, if somebody's in another whole area, they're more than welcome to, you know, pull pull the pin on a grenade and throw it over in another area and go, "Hey guys, I got a great idea over here.

4:28I want to blow some stuff up." And so, but again, you've got to defend that, and then you've got to defend the the resource usage uh to to to take it forward to take it past gleaming idea that I had while I was on the running trail this morning. Uh which you get a new idea every freaking morning if you're doing this, you know, it's just it and 90% of them suck when they actually come in, but when they're on the running trail, they're all great, you know, before they see the light of day in the actual business climate. So, anyway, I'm convinced that, you know, everything Ramsey has done has been on about 10% of our ideas. 90% of them when they made the light of day sucked. And some of them really sucked bad, but, you know, you you don't know that sometimes till you get in there swinging. So, all that to say it's bubbling up. Uh occasionally we'll have something that doesn't have a home uh and we have a special projects win team that is an incubator. It's a shark tank, if you will, for for ideas that don't They can jump in. And so, you've got some senior leaders representing several of the disciplines that sit in there, and special projects works on two things: broke things, broke, you know, some an area's got the flu, and it's you know, we're not meeting budget, we're not hitting our revenue goals, and it's a you know, it's a good size thing and it's a problem. I sit in that I sit in that work team. That's one of the things I sit on. It's one of the groups work groups I sit in cuz I'm entrepreneurial and I love working on broken things. And we'll take a baby thing in there that doesn't have a home, an orphan, and you know, put put it in the NICU in there and let's get this thing let's get it nourished. Let's see if we can get it moving and um see if see if it can survive. If we can get the thing to where it's past beta and it's actually the business is actually got some social proof, uh we'll make it a new profit center.

6:17Or we'll drop it into one of the existing ones that even though the idea didn't it didn't come from them. Uh and go look, this fits over here the best so we're going to drop it with you guys and um and you know, we'll take send a leader when we send it over there. We'll put a new leader on it and let and then start to staff it out. So, when you put a new leader on it that So, that was the who does new. That was kind of the heart. Um so, when you put a new leader on is that you typically pull like a junior like if your VP is head of a division, you pull somebody who's kind of one of their right hand they get the opportunity from a career pathing perspective that they can run this new thing or like how do you think through through bringing those leaders in? Are you mostly Yeah, I would just love to know how do you think through through that part?

6:58Probably 80% maybe even 90% of the time it's in-house and we're constantly working on bench depth around here. And so, we've got somebody waiting in the wings and it might be them that that birthed the new idea and brought it into special projects, you know. And so, they may have been rocking the baby for a little while and then they just get to they get to grow it on up, right? They get to give the orphan a home. And they they become the new mama daddy of the of the thing. So, um uh Yeah, that's how I like to do it because if the person if it it was born in their heart, they will they will fight all the enemies internally and externally for the survival of their baby. I mean and they'll champion the cause, baby. I like the people I like champions.

7:46Uh you know, they paint their face blue and uh you know, and you know, ride a horse with a big sword coming through the thing to get every and and sometimes you got to sit them down. I would a lot rather try to take somebody like that and pull them back and polish them a little bit than trying to light wet wood. Light wet wood. That's a great analogy. Well, when you when you start these new divisions, and I think I I I want to The reason I'm hitting on this is because I think it if you asked 100 entrepreneurs, what's the number one thing that uh you wish you could do, it'd probably be more new stuff. And so, I this feels like a very a very relevant thing to talk about. I think that happens at all levels because you know, at the beginning you're just barely figuring out what's going on, and so you're just trying and seeing what sticks. Later, you have more resources, so you think you can do more, um but oftentimes you also distract the team, they feel whiplash, and then sometimes the core business starts to falter because everyone's looking at the new shiny toy rather than the main game.

8:45We started it with one area, and it was tech, because tech was exploding uh 20 years ago. And so, you know, we had the web department. You know, that's what it was called. That's how lame it was, right? And so, but these So, these these you know, these programmers and tech people are all sitting in a room, uh but they're getting paid off the P&L of that profit center. So, the guy or gal running that profit center wants some freaking accountability.

9:15But, instead we had them just over here. They were on their own little island, and we had to break that up, and that's when we busted it about It's about 20 years ago. We went to this matrix approach. Well, this is is a is a great segue. Um so, with each of these VPs, I would imagine these are you know, among the most valuable people in the business, right? Cuz they're they're fundamentally running a business unit. >> got literally a P&L, and they literally get paid off the bottom what they get billed for portions of the overhead, the rent for the building in their area as if they were a you know, a standalone business so to speak. So we're job costing if you want to use accounting terms and and then they get paid off that bottom line. So if they if their bottom line goes zoom zoom, their personal income goes zoom zoom. I I want them to be very wealthy because that means they made me a lot of money.

10:04And so I love it. And and we want everybody in the building doing that. Also though, we have a high respect for the C-suite. We have a high respect for that senior marketer and the the value that they bring not just the entrepreneur running the the vice president's role. Or again, senior VP sitting some of those and even some executives some of our operating board members sitting some of those seats. But um but that's how you know, it all rolls up under a business unit.

10:31>> And then the C-suite I imagine gets kind of compensated from the company overall. Yeah, because what I've got is our operating board is half C-suite and half business units. And so what we've got to have is we've got to have this um uh we have to have an accounting system and a budgeting system that serves the business units and notifies the rest of us if the business how the business unit's performing. And so it's not really optional. You've got to do that. And if you're a uh a bootstrapped entrepreneur that came out of sales or marketing, you might not know how to do all that accounting stuff.

11:08And so I got to roll some accounting support up under you to make sure that that you get to keep doing the stuff you're good at, but we also actually want to count the beans and make sure there are some. >> you know, pay taxes. >> [laughter] >> Yeah, there's stay open >> of jail, all the good stuff. I get I get this question a lot so I'm curious your take on it. Um equity packages, stock shares, anything like that or is it all pure based on bottom line profit? Is that the kind of the performance compensation component of the the leadership that you bring in for either business units or C-suite?

11:41You know, when we first uh started sharing off the bottom line with people, that's when we had to answer the equity question. Was are we going to um let someone have stock? Okay, so our end game we decided a long time ago end game is not going public. End game is perpetual operation generationally.

12:05And so it's what Simon Sinek calls the infinite game. Okay? We So, we don't have an exit to an IPO planned. Uh we're not doing that. We've decided distinctly 25 years ago not doing that. We don't have a sale uh uh of any kind to a VC or anything else. We don't have a liquidity moment anywhere on the horizon at all. If you do, it would change what you're doing, maybe. Okay?

12:32Because if you're going to take the thing public and you give some people some equity, that's not a big deal. Okay? But if you're running it infinite like that and um about the only thing that we're a hundred The about the only person in the building we're a hundred percent sure is still going to be here is me. Everybody else could might someday want to leave or have to leave. And so uh uh and and I didn't want that. I wanted everybody to stay forever cuz I love our people and I I you know, there's some of my best friends are my leaders here that I mean, we do stuff with socially with our wives and husbands and everything else. I love them. I've got high respect for them uh as human beings, as their spiritual character, everything. But still I have over over all these years found that sometimes people leave.

13:19And I cry a little. But I cry a lot if they took stock with them. And so uh we don't have any equity positions at all. And uh you make unbelievably good money when you move into leadership and you're paid off the bottom line here, like lights out scary good money. Um Uh like nobody nobody does what we do. We're so freaking generous because these are the people that are running the thing. They're the people that grew this. They deserve to get paid like they're a partner.

13:49And so I I have zero greed over that. But you don't own anything. I own 100% Well, I don't own the stock anymore. My It's in my kids' names. Uh from an estate standpoint, but uh and they're, you know, my grown kids. My the the the the next gen of grown Ramseys. So, but uh I mean I got 1% to be clear. But the only voting stock. But the uh But anyway, no in other words, no equity. There's no equity anywhere except Ramsey's. That's it.

14:19I love that. Um I'd say Layla and I have a similar perspective on acquisition.com in that it's kind of our forever business. You know, we plan on just continuing to own and continuing to operate it. You know, we will will enter We kind of see it as the goose versus the eggs. Um at least how how we think through it, which is probably like we use different analogy, but similar you have 14 profit centers, those are the eggs. And then the goose is like, why would we get rid of acquisition.com? It's it's the the mothership to to use your language. So, real quick, if you're a business owner and you're not growing as fast as you'd like, I'd like to give you a free gift. So, my team and I put together the $100 million scaling road map, which is basically 200 hours of us looking over all the portfolio companies we've had and what stages of growth they went through and more importantly, where they got stuck and how they got past it.

15:05And so we broke it in these 10 stages and we made this little kind of quiz thing where if you put in your business information, it'll tell you where you're at and the most important part for you, what to do for each of functions of the business across product, marketing, sales, customer success, recruiting, IT, human resources, and finance. And so, no matter what you're struggling with, someone else has already struggled with it and solved it. And so, I'd like to give you this thing absolutely free. You can go to acquisition.com/roadmap, plug in your business information, and if you want us to actually help you deconstruct the business and you're trying to scale, we'd love to help you out. On the thank you page, you can book a call with my team and we will look at the business, see if we can help, and if we can, we'll invite you out to Vegas and we'll do this in person live.