Level Three Wealth

We just finished with our 3-day workshop on building a Level Three business and I wanted to share with you one key section that we taught there that really struck a chord with the participants.

It had to do with actually noticing the key milestones in your business that are in their own way landmarks of your business’s growth towards Level Three. We’re so quick to notice how far we have left to go on this journey, but we just gloss right over these key milestones that indicate we’ve taken an important success step with our business.

Here is a list of 15 of these milestones that I hope you allow yourself to notice and savor as you build your business. As one of the business owners who was at the workshop said (he owns two successful businesses), what makes the Maui community special is that it’s about more than just the money, it’s about the connections and value system we bring to the great game of business.

1. Your first sale. Proves that someone will buy!

2. Your 5th Sale. Proves it wasn’t a fluke.

3. The first major fulfillment mistake you make, and what it taught you.

4. The date you realized you really did have something of value to offer (and that your prices just might be too low.)

5. Your first sale that comes from your system, not from you.

6. Your 5th sale that comes from your system, not you.

7. The moment when you have a workable bookkeeping system that doesn’t revolve around you (but with smart controls in place to protect against bad behaviors). It gives you weekly A/R reporting, weekly sales reports, and monthly financial statements.

8. The first time you look at your product or service and realize that, “Hey, this is a really clear and repeatable value for people.”

9. The date you realize that your business is going to make it!

10. Your first key hire.

11. The day you write yourself your first “Oh my god, is this really happening” owners check.

12. Day you realize your business has a life beyond just you.

13. The day you return from an extended vacation and you realize that your company did better without you there for that time.

14. The first time you realize that if you were to get hit by a bus, your business would still thrive.

15. Day you start missing the good old days when you were needed to run every area of your company and you look back nostalgically. You are on a panel at a Maui Mastermind event telling your story and you realize that part of you is actually sad that those years of struggle are behind you. It was sure an exciting time you’ll say.

This list is intended to spark you to pay attention and celebrate those moments in your business that demonstrate the progress you’ve made. I’m all for being ambitious and keeping your eyes on the goals you’ve set, but to be fulfilled you’ve got to regularly notice the progress you’ve made. Milestones like these help make your progress visible.

Free Business Bestseller!
Build a Business, Not a Job: How to Build Your Business to Sell, Scale, or Own Passively
Get your free copy of this 176-page classic from Wall Street Journal Best Selling author David Finkel.

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Love this quote and thought it may inspire you:

“Until one is committed, there is hesitancy, the chance to draw back, always ineffectiveness. Concerning all acts of initiative (and creation) there is one elementary truth, the ignorance of which kills countless ideas and splendid plans: that moment one definitely commits oneself, then Providence moves too. All sorts of things occur to help one that would never otherwise have occurred. A whole stream of events issue from the decision, raising in one’s favor all manner of unforeseen incidents and meetings and material assistance, which no man could have dreamed would have come his way. I have learner a deep respect for the one of Goethe’s couplets:
Whatever you can do, or dream you can, begin it.
Boldness has genius, power and magic in it.”

–W.H. MURRAY

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I was talking with a business owner earlier today who runs a family owned business which has been in operation for over 25 years.

And to put it bluntly, he was really struggling with lower sales and cash flow issues.

I wanted to share with you the specific suggestions I gave to him to tap into the rich relationships he had earned over the years by building up his client base. You can use these same tips to grow your sales, increase your cash flow, and build up your business.

Formalizing Your Referral Systems

Any business with existing customers would immediately profit from instituting formalized referral systems. Here are several potential referral systems you can use in your business. The key is that these are systematic, automatic, reliably run processes that you use to generate referral business versus “one off” individual efforts.

You don’t need to use them all. Instead, choose one or two to implement in your business right away. They are low cost or free, and will dramatically enhance your sales and your client base.

The typical referral client buys more, refers more, and stays with you longer. Plus they are higher net customers since your cost to acquire a referral customer is relatively so much lower.

1. Point of Purchase Straight Referral Request: The best time to ask for a referral is often right at the time your customer buys. Have a scripted out referral question that you AUTOMATICALLY ask every customer who buys.

“Thanks Sam for choosing us to redo your landscaping, we take it as a real compliment that you chose us to work with. May I ask you a question, who are two other people you know who are looking to remake their yard and create a stunning landscaping like you?”

2. Point of Purchase “Gift for Your Friend” Campaign:

“Thanks Susan for shopping with us today. I know you’ll love our “Spoil Yourself Bath Kit”. Who are two of your friends that you’d like to give a complimentary “Bath Spa Sampler Kit” to? Normally it’s $19.95 for the kit, but for a limited time we have two complimentary gift certificates that you can give out to your friends.”

3. The “Compliment” Campaign: Every time one of your clients says a nice thing about your business, ask your power referral question. This question should be scripted out and memorized by all your team members. Quiz them on it and if they get it right, give them $10 bucks on the spot.

“Erin, I really appreciate what you just said. It means a lot to us that you get great value from our consulting program. May I ask you, who are two business owners you know who like you are serious about growing their business, and building a business they could one day sell, scale, or even own passively?”

4. Forward to a Friend Campaign: If you do an eletter, ask your clients to forward your eletter to those friends or colleagues they have who they think will benefit from your eletter.

“P.S. Please feel free to forward this eletter to your friends who are interested in buying designer jewelry at wholesale prices.”

5. Referral “Tools” Campaign: If you already send physical stuff to your customers, send them a few extra to give out to friends in an attractive “mini kit” or packaging that encourages the friend with some incentive to try your product or service.

E.g. At our live events, we give attendees 3 copies of our latest bestselling book for them to give out to other business owners they know who are seriously interested in growing their businesses the next level.

The bottom line is for you make sure asking for referrals is a systematized, automatic part of your business. As I said at the start, pick one or two ideas to start with and then grow your referral systems over time.

Have at it!

Free Business Bestseller!

Build a Business, Not a Job: How to Build Your Business to Sell, Scale, or Own Passively

Get your copy of this 176-page classic from Wall Street Journal Best Selling author David Finkel.
Or for more information on growing your business visit David on the web at: www.MauiMastermind.com

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Listen in to the this candid 20-minute interview with Wall Street Journal Best-selling author David Finkel and two of the newest Maui Advisors, Rob and Patrice Mabary.

Rob and Patrice Mabary have not only built one multi-million dollar company, but after they sold that several years ago they proceeded to build a $40 million plus Medical Education empire that works at training Doctor’s and Medical professionals around the United States.

Rob & Patrice Mabary: Success Secrets of Medical Entrepreneurs

Listen in as they share the things they did that helped them with their business and some of the painful lessons they’ve learned along the way.

Click below to listen:

Interview with Rob and Patrice Mabary

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Hi all,

My good friend and guest Maui Advisor Garrett Sutton wrote a GREAT article about asset protection changes that could greatly impact Florida (and with time other state’s) business owners.

Take a look at it. I think all business owners need to be aware of how they set up their entity to hold their corporation (LLC in this case).

After all, our business is usually our biggest asset!

Many of you have seen Garrett’s books (in the Rich Dad’s series). He is a sharp attorney. Check out his website: www.successdna.com.

Florida Loses Asset Protection

The Supreme Court of Florida took away a key asset protection benefit in deciding Olmstead v. Federal Trade Commission (SC 01-109, Fla. June 24, 2010). Before the ruling a charging order was the exclusive remedy, whereby the judgment creditor (the person who won a lawsuit) could only receive distributions from the LLC. Now, a judgment creditor may directly seize the ownership interest of a member in a single member LLC.

The Olmstead decision allows Florida courts to order a judgment debtor to surrender all right, title and interest in the debtor’s single member Florida LLC to satisfy a judgment. Prior to the ruling many had believed that Florida law provided that the charging order was the exclusive creditor remedy.

Not anymore.

Multi member Florida LLC owners should be very concerned by this decision. Writing a dissent in the 3-2 decision Justice Lewis warned that the Olmstead ruling means that the charging order is a non exclusive remedy for all LLCs, whether single or multi member.

Justice Lewis wrote: “The majority opinion now eliminates the charging order remedy for multi member LLCs under its theory of “nonexclusivity” which is a disaster for those entities.”

If you are using a Florida LLC to protect your assets you may want to reconsider your state of formation. Wyoming allows LLCs to easily reform themselves into Wyoming. The continuance process allows a Florida LLC to reorganize in Wyoming and keep the same formation date, EIN number and credit history. The advantage is that you now have a Wyoming LLC, which expressly recognizes the charging order as the exclusive remedy. Our office charges $750 plus filing fees to continue LLCs to the better asset protection state of Wyoming. Please call 1-800-600-1760 for more information.

And remember, asset protection is an ever changing area of the law. The Olmstead case was decided in a way that allowed another government agency - The Federal Trade Commission - to collect. Of course, the case now applies to the benefit of all creditors. In a dynamic field it is important to stay current on the latest cases, and move accordingly.

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I just found this “mini outline” on why business plans matter to you the business owner on my hard drive and thought I’d share it with you. 

1. Helps you clarify your business concept and think it through.

•  It is a checklist that forces you to consider your business from all sides before you launch. It helps ensure you won’t forget things. (Think pre-flight checklists that pilots follow even if they’ve flown a thousand times.) 
•  It sharpens your thinking by laying out great questions for you to be asking yourself. 
•  Helps you identify the variables to watch, test, tweak, and pay close attention to. 
• Helps you identify the key leverage points and priorities that will help you make better decisions where to invest your time, money, and other resources. 

2. It makes it easier for you to get outside input on your business.

•  It gives you a structured and organized way to “freeze” your business to let outside experts and advisors break analyze it and give you feedback. (Think frame by frame, multi-angle analysis of a sports game.) 

3. It helps you raise money and get buy in.

• Investor capital. 
•  Key team member’s buy in. 
•  Other supporters. 

4. It makes it easier to get into purposeful and directed action.

• It breaks things down into tangible, behavioral action steps with a clear timeline to produce them. 
• It helps you decide what to let go of for now. 

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Thanks for all the positive feedback on Wednesday’s post. I guess it really struck a nerve with a lot of you. I decided to come back to that same topic and share 7 more important tips on building wealth independent of your business.

First I wanted to remind you to register to join me for a 90-minute online workshop I am personally teaching next Wednesday (July 14th) at 5pm pacific/8pm eastern called, “A Concrete Road Map to Build Level Three Wealth“.

The Three Bottom Lines for Wednesday’s Online Workshop:
1. A proven model upon which to base your business and financial success.
2. A concrete road map you can follow to IMPLEMENT this new model in your business and your investments.
3. How to overcome the three biggest obstacles that stand in your way of reaching your financial dreams and aspirations.

——> For More Information and to Reserve Your Seat

Once you’ve registered, you’ll get (via email) the 10-page PDF workbook for the online workshop including the access code and link to attend (or phone number if you want to attend via conference line). We suggest you print it out and have it to take your notes on so that you get the most out of our time together.

Okay, now on to those 7 additional wealth tips to help you build wealth independent of your business:

1. Risk comes from not knowing what you’re doing, so pay the price to learn what you’re doing! Sounds obvious I know, but most business owners I know are ego driven and uniformed investors. As you can imagine this is a an explosive combination. They tend to let their business success blind them into thinking that they know more then they really do.

2. Make sure you’re investment plan matches the financial stage you’re at. I made this mistake and it cost me millions… When I sold my first two companies I got a LARGE wire transfer from my buyer. What I now know (having paid the price to learn) is that I needed to invest in passive residual producing cash flow investments, not in non-cash producing “capital gain, forced appreciation” deals. But I did what I was used to doing and as a result, I made several investment missteps. Be very conscious that your investments must match your current financial situation, don’t just follow your old plan that got you to your current position. Even if it worked brilliantly it may no longer apply to your new situation.

3. A portion of your investment portfolio must hedge your risk in your current business. That means that a percentage of your investment portfolio is something that will either do well if your main business has a downturn, or at the very least is insulated from any industry or macro-economic stress that impacts your business.

4. Do your due diligence BEFORE you invest. Due diligence costs in the hundreds or thousands of dollars. The price of NOT doing you due diligence is in the hundreds of thousands or millions of dollars.

5. If the deal cannot afford the lawyers, don’t do the deal. Always have your attorney and CPA (and if possible your mastermind group) give you their objective input before you make the investment. And make sure your attorney reviews all the deal documentation before you sign! Seems obvious, but I see the consequences of business owners who skip this step.

6. Concentrate your investments in fewer, better deals. There is a cost to every deal, make sure your deal is meaningful enough to merit the time, focus, and expense. The wealthiest people believe in concentration of capital. Sure they diversify, but not with hundreds of smaller investments. You can hold 5-10 investments and still have the needed diversification. How can you really do 100 great investment moves? And look after them after you’ve made them? It’s too much. Concentration of capital is the name of the game (with diversification in 5-10 investments you know and understand.)

7. Buy America while it’s on sale. This is a quote from a friend and new Maui Advisor David Stech. David’s point is that there has never been a better time to buy great assets cheap than you’ll see over the next 36 months. I guess you could call this the upside of a very challenging economic climate.

I hope you put these 7 tips to great use in your financial life.

Have a great rest of your weekend.

I hope you invest in yourself and your success and decide to join me for the online workshop next Wednesday (July 14th). We’ll email you the 10-page PDF workbook and log in code as soon as you register.

——> For More Information and to Reserve Your Seat

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Linda Pinson author of Automate your Business Plan and Anatomy of a Business Plan
Listen to this 28-minute candid interview between Wall Street Journal Best Selling author, David Finkel and Linda Pinson, author of Automate your Business Plan  and Anatomy of a Business Plan.
Click below for audio:
Top 10 Business Plan Pitfalls-Interview with Linda Pinson
 

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I hope you had a great fourth of July.  Heather and I took our sons to the local parade here in Jackson Hole and they had a BLAST!  Horses, fire trucks, and covered wagons—what’s not to like right?
 
Today I wanted to share with you 4 important tips about building wealth independent of your business.  Too [...]

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