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Agency Or Course? A Forensic Analysis Of Both Models (Pros & Cons)

Agency Or Course? A Forensic Analysis Of Both Models (Pros & Cons)

Summary


Should you start a done-for-you agency or an online course?

Or... Should you start with an agency then do a course? Or both?

This is something that many entrepreneurs are torn between and perpetually confused about. Some people believe "selling courses" isn't a "real business" and that somehow, selling services is "real".

There's sayings like "those that can't do teach" and perceptions that everybody teaching courses can't do, and instead, they're scamming people by selling them fake instructions about doing.

This is a FASCINATING topic!

Kutako Komeheke is a successful 7-figure Consulting Accelerator student and right now he's torn between his agency business and his course business.

He doesn't know what one to focus on or how to balance both. This is a painful place to be in and many entrepreneurs go through it  (including myself).

We discuss the pros and cons of both business models and the most ideal path to take as you evolve/grow as an entrepreneur.

This is a video you do not want to miss!

Check it out and let me know what you think in the comments?


Here's what we cover:

1. Should you start a done-for-you agency, online course or both? What are the pros, cons, scale limits and financial limits or both models? 

2. Why some people think "selling courses" isn't a "real" business and that selling done-for-you services is "real". (and why they're delusional). 

3. The unfathomable complexity of scaling a done-for-you agency and why the business model thrives when its small and self-destructs when it's big. (and how to combat this). 

4. Why selling courses can only happen after you've done the thing in practice, identified a system or "proof of concept" and mastered it -- and why people who teach things they can't do are total frauds.

5. My personal story of being torn between my marketing agency and my online course, the problems I faced, the emotional turmoil I was in and why it took me 1-year to make a decision.

6. Why I focused on my course business and shut down my marketing agency business and why everything changed for the better when I did this. (best decision in my entire life!).

7. Why the marketing agency model is flawed because the client doesn't take responsibility for their side of the equation and why they blame the agency for no results when it's their business that's screwed. (this is enlightening).

8. Why online courses provide a three way symbiotic relationship between the student, their environment (market) and the training content and why this is superior to the silo'd environment that exists in the marketing agency model. (fascinating shit...).


Check out the video and let me know what you think in the comments?

To Your Success!

Sam Ovens & the team at Consulting.com.

Transcript / MP3

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Sam Ovens: Hi everyone, Sam Ovens here and today I've got [Katako 00:00:03] on with us. And today we're going to do something kind of a little bit different. I was talking to [Katako 00:00:11] before and we were discussing about should we cover his story in the normal way I do, in sequential chronological order? But really what I found from our kind of pre interview was that right now [Katako 00:00:29] is really on the fence between two things, an agency and a program. And he actually started off with an agency, grew it up to be very successful and by agency I mean helping businesses with digital marketing and helping them scale and sell their products online. And then he also created a program kind of showing businesses how to do that themselves instead of having [Katako's 00:00:56] team do it for them. And now he's unsure if he wants to go just all agency, all courses or both. And actually you told me before you wanted to do both right? Speaker 2: Yeah, that was something I definitely wanted to do. Definitely wanted to do both the academy and then supplement that revenue with what we were doing with the agency and it's been an interesting journey nonetheless. Sam Ovens: So why both? Speaker 2: I would see guys like Frank Curron who's killing it doing both. And I see guys like Gary Vee who's doing hundreds of millions of dollars a year just doing an agency and I guess in my mind I felt like I don't really know too many examples of people who are academy only that are doing hundreds of millions a year. And so for me it's a torn thing because I'm very split minded about it. I know that I could take a ... Sorry about that, can you see me? Sam Ovens: Just light a bit. Now I can. Speaker 2: I know that I can take an academy and do $1 million a month, $2 million a month of it because there's plenty examples like yourself people who've done that successfully. But then there's the other part of me that wants the crazy big numbers, the hundreds of millions of dollars a year. And so I don't know man I guess in my mind I'm a greedy guy in a sense. But I see somebody else able to do something in my mind I instantly know that I can do it too. I just have to learn how they're doing it and try to emulate as best as I can. But I think maybe sometimes that stretches you too thin and often times it's better to maybe hit one goal first and if that's getting your academy to $2 million a month, $3 million, whatever that number is. And then maybe if you can give that a little hands free then maybe you could start something else. I don't know man, I've been very split minded about this whole thing. Sam Ovens: This is a good conversation because I know a lot of people go face this thing which you are now and I face it myself and I sat in the pain for a year before I finally made up my mind. So this is definitely a good topic. But what I'm interested in is you have kind of ... Let's define your goal, what you're trying to achieve here as just achieving something really big, big numbers, hundreds of millions of dollars because it kind of sounds like that's the goal. And you see that having an agency can do that because you've got an example of Gary Vee which we don't actually have his books and we don't actually have the actuals but it's a perceived. But then who have you personified on the course side as the Gary Vee equivalent for courses? Speaker 2: Yourself, Frank Carron, Ryan Dyson those guys at Digital Marketer. Those guys are doing pretty similar numbers and they just sell a bunch of courses as well. So I think there's enough examples particularly Dyson and those guys at Digital Marketer but they're huge, they're massive, they're really really massive. It's not a 5 or 10 staff team over there. So I think from a course of things Digital Marketer would probably be the only people that I know that are doing or supposedly doing over $100 million a year. Sam Ovens: And so if they are doing that, I'm not sure if they are not, then isn't that equal to their agency siders. Speaker 2: Yes. Sam Ovens: Before your argument was well I want to do the agency because you can do the big numbers I don't know if I can do that with the other one because- Speaker 2: I didn't think about it until you asked me the question just now. And so when you asked that question I realized there are examples, so you're right. Sam Ovens: So then what is it? What's making it painful and hard to choose? Speaker 2: I don't know. Sam Ovens: There has to be something because it's there. Speaker 2: I think in my mind it wasn't until this conversation with you that it really prior to now up until today I don't even think it was a thought in my mind to just choose one over the other. I guess in my mind up until now it was always how can we do both? So it really wasn't until today's conversation with you that I felt there needed to be a decision that's made. Sam Ovens: Why both? Speaker 2: Prior to now why it was both important to me? Sam Ovens: Yes. Speaker 2: Because I felt there weren't enough examples of people doing both well and I wanted to be the pioneer or one of the people that pioneers that maybe. Sam Ovens: Yeah I think that if you do two things you split your energy 50/50 and if you do one thing you get to give it 100%. So that's why I think it's better to do one thing because both of those businesses like an agency is extremely complex. You've got to get clients that in an agency that's not an automatic process. There is the marketing side of it, there's the leaching and then there's probably calls with these people probably multiple calls. There might even be some email exchanges and things. Then there's probably an invoice and then there's probably a billing sort of process, then there's probably an on boarding process which involves more calls. And then there's the process of the human inside your business understanding their business and their market which is a big thing. Sam Ovens: They have to fully sync and understand it and then that human inside your business has to be good, which is a hard thing in and of itself. To then apply their knowledge to the specific application of that client and then even if they are delivering results they then have to manage the emotions of their client because even when they are getting results doesn't mean they're going to be happy. And then you've got the billing which is going to need ongoing management because it's not credit card and automatic. That at a micro level is what an agency is built on, those building blocks, just lots of those. And the thing was that building block is there's a lot of human labor and a lot of specialized human labor. And I don't know if you've noticed but it's pretty hard to find specialized really good hard working knowledgeable humans. Speaker 2: And when they are good they'll start with you for a bit and once they get their hands on something that's working for them they quit and go start their own shit and so you kind of left back in square one again needing to hire new media buyer or a copywriter or whoever. And we've dealt with that definitely for sure. Sam Ovens: Yeah. Well the only way you can really hang on to good people is to keep stretching them because if they're continuously improving then they will stay because they know they're getting better. It's when the work is no longer challenging they're no longer learning anything and they get bored that happens. And I guess that can be hard in an agency model because you just want them to keep managing clients just kind of keep turning the cog. They don't get to tackle new exciting challenges. So what do you think about it now. Speaker 2: I think you and I are on the same page. I think there's certainly a lot less headache running the academy effectively than there is doing the other stuff of commonly the agency thing trying to run ads for other people. It's a lot less headaches. A lot of what you said is very very true, everything you said actually is very true. Managing client expectation, dealing with billing. Some companies they need a net 30 and they need a net 45 or you do build on the card and the card declines. There's a lot less moving pieces I think on the academy side of things and I definitely agree with that. Sam Ovens: The thing that really pushed me over the edge with this decision it was ... Well I'll explain how it started first because this is kind of how I'd probably start with you too and probably everyone else who's got an agency. Is you start out by doing done for you for 1 business or whatever where you learn, you're helping them get clients with digital marketing, you learn the platform and everything you get pretty good at it and you get them results and then you start adding more clients and then you're like sweet, these scalus things. You keep adding more clients but then very quickly you realize that you are the bottleneck and that you are now maxed out with let's say five ting clients. Sam Ovens: And then you think, alright this is a simple equation, I just need to add more humans. So then you start doing that but then quickly you realize that they are hard to find. It's impossible to find them at the skill level they need to be first of all. And then it's quite hard to find them even with the potential to have their skill level. Then you find them with that potential then you've got to train them and that's a whole project in and of itself and that takes time. And then you start getting more clients and getting more humans and then you can keep scaling but then it reaches there's a network effect in there and what I mean by that is when it's just you there's one possible thing. Sam Ovens: When is you and one other person there's only one connection. And then as you get to 3, 4, 5, it gets exponentially more complicated because there's so many different things in there and that's when it starts to kind of wobble. And you're like, man I'm going to need managers and managers for managers, managers from managers for managers and then going to need a whole recruiting firm just to manage the outflow and the inflow. And then you start thinking about it, I'm going to need a department just for billing, I'm going to need it department for everything and I don't know if we can actually quality control it at massive scale and actually produce really good results. Sam Ovens: And so that all troubled me but the biggest thing that troubled me was that there is this perception with an agency and done a few services where the business they hire you to deliver them results. And then when they hire you they pay you the money and stuff and then they like, “Cool, just get me some results.” And they just kind of like, “Go do it.” And then you might set up a funnel or you might set up some ads or whatever and do it really well and do your job really well and deliver them leads and traffic and all of that. Sam Ovens: But it doesn't overall get them the results that they want and a lot of it is actually because their business it's broken. And it's because they don't have good sales people but they might not even answer the damn phone. I can't tell you how many times we would be generating calls for plumbers and stuff and no one would answer the phone. Or if they did, they were just not interested. I was like, “Hello.” I was like man because we had the call recordings from all of these calls because we were doing I think it was called Telecon or something. Speaker 2: From the blueprint. Sam Ovens: What was it called again? Speaker 2: I don't remember it but you're right. It recorded all of calls that she generated for your free clients so she could listen in. Sam Ovens: Yeah I would listen to them and I was like, “Oh my God.” And I would tell them this and I would try to help them with it and then they kind of weren't interested and if they were interested I had to babysit them and give them a script and stuff and I was like, “Man I'm getting too involved.” And then I would fix that part but then I would go into their store, if some of them had stores, and I would notice that they had one intern kind of person that was on staff. Just on their firm just totally disinterested in who was in the shop. And I was like man even if I do get people to come in, this crap is going on. And then they started telling me I was getting this company good results and then they started saying, “Oh, we're going to have to cut back how budget.” Sam Ovens: And I was like, “Why? It's working.” We're getting you our why, we can prove it. And she was like, “Yeah I know, but we've just ordered a whole bunch of new inventory and we're in a cash crunch.” And I was like, “Why the hell did you do that? We've got something profitable working, you've got too much inventory already, that's what we're trying to sell. Why did you go on all the more?” And she was just, “I don't know.” And I was like man I'm getting penalized here. For a lot I'm not succeeding, you're succeeding, and yet we're getting penalized and everything is going to get ground to a halt because you made a stupid decision. And I just noticed this more and more and then I dug into it and I found out that the reason why she ordered so much of this crap was because they had no inventory system. Sam Ovens: So then I was like, “Where's your inventory system?” And they showed me a Gmail. And I was like, “This is an email, this isn't an inventory system.” She was like, “Yeah, but I drag these emails into here.” and like oh my God. And I was like, "How do you know how much money you're making?" And she was like, "I don't know." And I had this realization I was like holy shit there is nobody out there because I used to think maybe these were just the businesses that didn't have their shit together. And so I was like it's alright, I've learned my lessons with these ones but I'll just try to grow my agency helping companies that are highly organized and have their shit together and are on the ball. But then I found out that there is none of those. Sam Ovens: Those are unicorns, they don't exist. And if they do they don't really need help. The agency model and my mind was kind of built upon an idealistic assumption that these businesses the only piece they were missing was the marketing and that if we did seen them traffic they would convert it and they'd have a good product and a good support mechanism and they would actually add value and their customers would be satisfied and I was just it was too idealistic and no matter how well I did my job, it would still wouldn't work unless they did theirs but this piece just didn't really work. And that's what really drove me off the edge with that one, I was like I can't do this. I also can't get that involved in their business unless we'll buy their whole business if I'm going to go and do that. Sam Ovens: And then on the opposite side with the programs, a course I was actually amazed what happened there because the assumption is that done for you gives clients more value than a course because you do it for them you. You just doodle, they just have a sleep or something. The thing with the course you are alright I don't want to do any work, they don't want to learn anything. That's the assumption there kind of for most people. But with the course what I found is that people actually took responsibility for their site, for their business. It was a more holistic thing. I was like, look you need to have a good product, it needs to solve a problem, you need to be differentiated from the competition, your pricing needs to be good and you need to have really good operations. Sam Ovens: You need to have good inventory, you need to have good support, you need to have good salesmanship, you need to have processes for things that are less predictable, you need to have good numbers, you need to do all of this and then the marketing will work. And when I actually gave it to them and I said, "It's all on you." They actually took responsibility. Whereas with the other model they just looked at me as if I was going to come in and start walking on water or something. Speaker 2: Makes perfect sense. There's so many other variables when doing the agency thing that come into place that is just beyond your control and that makes perfect sense. Sam Ovens: Has that happened to you what I said just now? Speaker 2: Not nearly as bad but there've been situations and times where we generate a bunch of leads for clients and the business that they were in was just kind of going into the shitter anyways and so those leads weren't converting any more over a period of time. A lot of a lot of what you said is I haven't had nearly as bad as you had but I've definitely seen it for sure in smaller bits and pieces. Sam Ovens: That was an extreme example just to kind of make my point. But that is the nature of the thing. Generally what I've noticed is if a business can't do one thing well there's a high probability that they can't do anything well. And when they can do one thing well they can a lot of the time do a lot of things well because excellence is like a standard. It's not something that just applies to some things and not other things. Speaker 2: There's that quote that says, “How you do anything is how you do everything.” So you're either doing everything really well or you're doing everything pretty shitty. Sam Ovens: And what I liked about courses is you could actually teach people that and make them change as humans, you fully change themselves. Because that's actually what it takes to be successful. I've been telling one of my clients, “Look if you want to be better in business you got to become a better human.” It's like sometimes they see it as a separate entity whereas, “Oh I can just be lazy and chaotic over here and then just real organized and profitable over here.” So what's going through your mind now about your situation and what you want to achieve and what the best path forward is. Speaker 2: I think what I have gathered from this conversation is focusing on the academy and I kind of guess getting rid of the idea of the whole agency thing would be probably the first step in yielding more results. And I think that does a lot of focus for sure because in between what we've got going on with our academies and whatnot. I'm always thinking about that other thing, how can I get this thing in the back of my mind to do a little better as well and I can be spending that time thinking about better ways to grow what's already working because it's been the most consistent thing for us for sure. Speaker 2: And then we have other aspects of our businesses that do model seven figures a year but focusing on the main thing I think should just be the main thing. I think that definitely will make a huge difference and a lot of what you've mentioned is shit that I don't even feel like I want to deal with. You told such a great story and sometimes it's good to hear those stories from other people that went through the trenches like that 'cause I haven't spoken to anybody who's really built- Sam Ovens: For you it's worse than that, I'm thinking about it now. And I mean they like to get really good sales people from the other companies and stuff. A lot of the sales person in the agency model right. And then they want a car. And then they now want a guest card for fuel and then they want a phone because they're going to be doing a lot of calls and then plan with that phone and things and then probably a company car maybe if they want to do lunches with people and having one car, one credit card and one phone is complicated enough. Even having one car is almost too complicated. And imagine having lots of those and lots of humans and lots of clients and lots of connections between these things. I could not find a way to calm that chaos. Sam Ovens: But whereas the program is more I found is way more symbiotic between the, there's three components, there's the individual in the end of any business, their market which is kind of like their environment and the content in which they're consuming. And there's a symbolic kind of relationship between these three things. So they are looking at the market and making changes and they're looking at themself and the market making changes that way and then they're looking at the content and learning things they're making changes and it's going like this all the time. It makes it very dynamic. So you can have one static course but infinite possible paths through that course because of the symbiotic nature of these things. Sam Ovens: Also you get to take the burden of work off of you and it goes on to them which is a massive positive right. They do it all, they figure it all out instead of you but you just tell them how. And then they take responsibility for their results instead of looking at you. And then also with a with an agency there's not much of a symbiotic relationship because the business kind of isn't looking at the results and what's happening on the marketing side. And if they do it's through a shitty report that doesn't say really much at all. And so they don't really notice, they're not able to kind of iterate and respond and react here. And then the agency over here is some dude probably managing 20 accounts sitting in a house or an office somewhere and he doesn't have much visibility into this business. Sam Ovens: So there's not much of an iteration and symbiotic kind of balancing here. And then the market. Well if the business can't see this, this guy will go here probably he has no idea what's going on in the market and this person is probably not looking at the market because they're just looking at the agency expecting magic. These three components are siloed and there's no interconnection and if it is it's through a very small low bandwidth, low frequency sort of connection ad it's shit. Speaker 2: 100% agree, it makes perfect sense. I remember you said that for a year you were kind of in a similar space where you were torn between the agency and the academy kind of thing or the course. How did you discontinue that whole thing? Did you just stop all your projects at once? Did you just put a little bow and say hey we're going to continue this to the end of the year for you guys and then we're going to cut this program? How did that work for you? Sam Ovens: It's the reason why it took me so long to get rid of it in light of all of these negatives which I just talked about, was because of all of these beliefs that were kind of reflected by society's belief too and the general public opinion at that time which was those that can't do teach, there's a saying are right and I just had that saying and I hear it a lot and I was like ... And I had done courses by people who were just bull shitting and that's obvious that they had never done and I would never wanted to be one of those people. And I always thought those people would sketching and scamming. And so I really liked it, I thought it was my identity and my point of difference that I did exactly what I told people how to do and I had a real business. Sam Ovens: That was another one of those things, a real business. It's where to find real men. A business is something that adds value to someone, solves the problem for them and there's an exchange of money. That absolutely was happening with my course. The only reason why the agency was more real was probably because there was ,ore human components and the presence of atomic office. There was atoms there in a state of just all being bits virtually. But the more I analyzed that I was like this is kind of just stupid. This is a real business it's just not perceived real by these common folk. And then I was like also you know how to do it because you're doing it and you do it really well. And so obviously those that can't do teach thing doesn't really apply because you've done it. Sam Ovens: And I also hang onto this thought that I have to keep my agency so I can keep working with clients to know what to do to teach people in the course, but that wasn't true really either because at its core what I'm teaching people how to do is market, sell, get a good product market fit, know their numbers and run a good profitable business that grows fast and is efficient. Now I'm still doing that with my course business. My course business has to market, has to do funnels, has to do ads. It has to be efficient to make money and all that. So by focusing just on that I am doing it. Do you get what I'm saying here? Speaker 2: Got you. Let me ask you this, I think one of the benefits that people think about ... And I'm asking this not just for me because I'm sure other people are thinking about this as well. I think people are attached to the idea of being able to re-bill a customer over and over and over again month after month and getting from I guess in their mind if you look at one of the numbers that I'm sure you guys take a look at because we look at it for ourselves or our academy is average earnings per lead or earnings per sale over a period of time. And I guess in my mind one thing that I was attached to and maybe a lot of people who are in the agency space are attached to is that whole idea of I get to bill this person over and over and over again for whatever amount of money versus billing them or charging them one time for a course and then it be done. What were your thoughts on that when you were kind of making that transition. What is it that maybe the person on the other side of the fence doesn't see that maybe that can also still be used? Sam Ovens: I'm glad you brought this up because this is one of those things that's like the course isn't a real business thing, it's a real theory stubborn belief that MRR, monthly recurring revenue is way better than one off revenue a year. Because there's this assumption that I've got monthly recurring revenue which means that I don't even have to do anything next month. I don't even have to do anything or get any more customers and I'll still continue to make money. But that's bullshit because there is a thing called churn. And churn is an evil nasty thing that is very hard to tame. And almost nobody can time that well. And you need to look at your attrition rate. And so if you're acquiring say four customers a month then there's a high chance that you're going also start losing 2, 4 customers a month. Sam Ovens: And you have to do a lot of work just to hold. That's what normal effect is in. They say the stickiness of the revenue but they assume that it's going to keep billing forever. And there's multiple issues with this because the first one, and this is the big one, is that there's a trough in the cash flow model. And what I mean by that is, and this is the nastiest thing of the whole I'm just going to jot it quickly for you. If we've got here. Imagine, I'll just make sure you can see this thing. So let's say you're doing an agency and you're charging $2000 a month for Facebook ads or some into some business right. Well, you've got to pay money to acquire that customer. There's going to be advertising spent, there's also going to be probably some salesman salary or commissions or both. And there's also going to be time and all sorts of things in there. Sam Ovens: And let's say that it costs you $2000 to acquire that customer which is still pretty good. What a lot of people find is that it probably cost more than that. So if you get like a customer you've gone down minus $2000. So you've gone, let's say here's zero and you have started here and you have gone down $2000 to acquire them and then they pay you $2000, now you're back at zero. And so then each month after month you're starting to go up but the problem is this area down here. And there's this whole myth that it's all about LTV lifetime value. And people have just being brainwashed with this crap. People keep spouting off like it's all about lifetime value. If you know you are going to make $40000 from a customer over the lifetime, over the next 10 years, then you can afford to pay $30000 for that customer. And I'm like, “No you can't you idiot.” Sam Ovens: Because if you're only going to collect that and $2000 a month, then you're $28000 negative on that one month. And if you're planning to do this at scale we have to have multiple extrapolate that minus $28000 hole out over thousands of customers. And I'm like, “You got to spare hundred million to defeat this trough. That's the only way that's going to happen.” And so LTV is a bullshit metric because it assumes that you don't have to pay any money to acquire that customer and to accumulate a lifetime of the revenue you have to stay alive to collect it. And so it's more about, the number one metric I put my eyes on not LTV is the DAI one cash collected from invoice. So. How will I word with this beast? I'm looking at cost per acquisition that I have to pay to acquire that customer let's say it's $2000 and how much cash I collect day one of that invoice and not accounts receivable. Sam Ovens: So if you know if there's a contract for 12 months and it's $2000 a month then you could that a $24000 deal. But only $2000 is in cash and $22000 is in IR. And you can't live on IR, you can't pay for food with it, you can't pay Facebook with it, you can't pay employees with it, it's useless. I mean it is a future and probably will collect but it has no value today. And so really what I spent my time doing is just trying to engineer a business model in a way to get liquid on cost position and actually make a profit there on cash so that I knew I could always fund the growth of my business without debt or investors. I learned this from Salesforce and it happens in Salesforce all the time because they charge a subscription. So a company like HubSpot for example, they pay three years of EMRA to acquire customer. This is lunacy and this is all over the SAS industry, everywhere Sam Ovens: The main reason why they raise money is to fund this assessed pit because of the lifetime value. So you need someone to fund it and hell if you get someone who's going to give you 100 million go for it. But a lot of the time businesses are self funded and they don't have that 100 million. So what I learned from Salesforce is they had this problem and they were going to go bankrupt pretty much. They had to pay say $2000 to acquire customer and they were billing say $200 dollars a month. And that means that when they acquire that customer they actually lost money on day one. But then over a year it kind of broke even. And so some genius had the idea of let's just switch to annual billing. And so they changed it to annual billing and you had to buy it upfront one year and you had to pay the $2000 upfront. Sam Ovens: And just by doing that Salesforce just took off. And then I thought about that for my agency. And I was like a course, people who think EMRA is good but imagine what would I prefer, $200000 a month for 12 months that may or may not collect or $2000 upfront on day one and not having to chase the money. And here's the other thing is that recurring revenue, you can create new versions of products. Here's a prime example, one of the best selling most profitable things in the history of the world as the iPhone. It is not a recurring revenue item the way people think of EMRA but it is because they release a new model every year and everyone buys the damn thing. So it's yearly recurring revenue and everyone buys the thing and Apple gets to collect the whole stack up front. So I thought about well my business is kind of the same as the iPhone. Sam Ovens: The market changes, I get better, new discoveries are made. The product can be made exponentially better year after year. So I can ship and release a new version each year and that will kind of act as the recurring. So it is better than recurring revenue in my mind because I don't have to chase subscriptions and I get my cost per acquisition liquidated upfront which doesn't happen with the EMRA. No chasing subscriptions or having churn issues which happens all the time with EMRA and I still get the nature of recurring revenue by releasing a new product every year. So I get all the positives and none of the negatives really. But what I don't get is the buzz word and the hype around EMRA. Speaker 2: That makes a lot of sense. Wow this was very enlightening for me. I think this is a conversation that I haven't seen in an interview in the US. I don't even watch all of the interviews because I'm always working but when I get down time to watch them. This is a much different conversation. Sam Ovens: You can I thought about this thing. I haven't thought about it in a long time but I mean for one year it was all I thought about. I couldn't even taste food because my mind was fully attached to analyzing this situation. Speaker 2: And you had an agency that was doing pretty good back then because I remember you had the Consultant blueprint and you had your agency things and you guys were doing several hundred thousand dollars a month. But when you focus just on the academy side of things is within a year or two years you went to seven figures a month, multiple seven figures. And look at your numbers and I sed it over to my partner ad we get really angry and mad and we decide we got to do some better Facebook ads, look at this guy shitting on us. Sam Ovens: Yeah, it's focus. In an agency you got to run ads for like a hundred people. Dude I can't even run my own ads. I've got a team to run one company's ads. So look at an agency you've got to have, you see what I'm talking about here? I've got a Facebook media buyer, a YouTube media buyer and then a marketing manager who manages them. And then a whole team here just to do one company's thing, one company's ads. And all of our effort and energy and everything's getting channeled into that and it's multiplied by having other members. In an agency you're trying to do your own ads and a hundred other people's ads. Actually what you're trying to do is your own ads for the agency and a hundred other people ads and then your course's ads. So look at where that energy is getting dispersed. It's like the difference between a flashlight and a laser. The flashlight is just kind of going out everywhere and the laser is just. Speaker 2: That makes sense. This has been very enlightening sir. I like what you're saying though. There's some things that I think that we're both doing the same that are working well. We're doing YouTube ads and Facebook ads as well. We're doing them ourselves though so it's a little bit different than having media bodies doing doing it for us. But yeah man, you've said a lot and I've felt like I've learnt a lot just just within this conversation for sure. Sam Ovens: And also you asked a question earlier where you said, "How did you phase out of the agency and into the course?" Because if this thing called churn that exists. You just don't add any new customers, don't sell anymore people or market anymore and this thing will just die. And then then you'll see this thing I'm talking about [inaudible 00:45:22]. Speaker 2: Even if your numbers are, that's crazy. Sam Ovens: Do people stop/cancel their services with you when you're getting them results just because their mood changes. So it's not a guarantee that thinking that if I continue to get people results they'll continue to pay me monthly is an idealistic view based on that humans are rational and they aren't, they're definitely not rational. They're lunatics and they're mostly emotional and impulsive and they might drive down the road one day and see a black cat and think, “I knew it, I'm canceling that Edwards guy.” I bet you that has happened lots of times. So when you are dealing with that sort of shit man I can't handle it. I can't handle doing good and getting punished. In my world if I'm going to do something good I at least want a reward. If I don't do good I believe I should be punished. But I do not want to do good and get punished. I can't handle it. Speaker 2: Madness. Wow man, you give me a lot to think about Sam, I appreciate this man this very well. This is a different interview, I was sure how this was going to go at first man I was nervous. Sam Ovens: This wasn't an interview, it was a conversation. Well hopefully this helps a lot of people and you ad then we should do a follow up one certain later on once you've actually started doing this. Speaker 2: Cool. Couple of questions. When you do these live interviews, just out of curiosity, do you use the whole thing or do you do segments? I was always curious about how that worked. Sam Ovens: I use the whole thing because I ain't editing it. Speaker 2: You got video ads man c'mon. Sam Ovens: This a waste of time man. Well I look at the value of something so I'm like a humans going to watch this and they're going to take from it information, they're going to use that information, the thing that matters is this information. And it doesn't matter if there is mums or razzle all over this. So screw it I just focus, I keep the main thing the main thing that's why even my YouTube videos I've got two videographers and all of the fancy gear and shit. And when I do a blog video I just get my phone and just go there. Because I can record the video just speaking to it without any microphones or lights or anything and then I can just immediately upload it and push it out myself without touching any of people or involving any process and it's instant bam up. Same with this bam it's instant up. I like things to be full stack. Sam Ovens: And by that I mean not getting passed along a line. If I have to record this and then send it to an editor then it's going to sit in a queue in this editor is going to have all this other shit they go to do and then they'll get to this when they can do it and then it might have a back and forth a bit to get the right in it and then it's going to go to someone else who's the got to upload it and whatnot and then say it comes back around to me and the I've got to post it. Now I've forgotten what the hell the interview was about because two weeks have passed and now I don't know how to write the description. So now I got to watch this thing again and you can see what I'm talking about is just waste. If the person closest to the thing is the best equipped to do it. And so I just record it, do it in one take. I also think people really like things that aren't capped because it's just natural and authentic and then bam, push it up onto YouTube. Speaker 2: I noticed Tylop has a little bit of that too. It doesn't go deal with the heavy editors and video crew all the time, a lot of it is just him on his phone and then just put it out there and a lot of his bigger ads that I've noticed have the most engagement's, his stuff is recorded straight from his phone. I think often times people make the mistake of assuming it's got to fancy, it's got to look pretty and cut and a ton b-roll. I think videos like that do have their places, I'm not discrediting that at all because we've made several millions of dollars with those type videos but I think every once in a while this type of stuff is healthy. Sam Ovens: Yeah really what I think it is the closer you can get a thing to a reality, the more people connect with it. Speaker 2: Wow, that's powerful. Let me ask you this man, I don't know what kind of time you're looking at but actually when you felt like your course kind of hit its stride and you thought, “Okay boom, we're at now seven figures a month.” What are some things that you had then that you didn't have before that you feel that made that huge difference. Because it's certainly more than just running ads that converted. I felt like a lot of bottleneck is maybe in personnel, maybe in team. What did you feel like were some things that you learned when you hit seven figures in terms of structure for your business and staffing and stuff like that that was a huge difference from where you are now to where you were before you guys were doing seven figures a month? What do you feel like actually?- Sam Ovens: So you're asking for the difference between where I'm at now making multiple seven figures a month to where I was at what stage exactly? How much per month" Speaker 2: At what stage before seven figures a month. Let's say when your academy was only doing let's say six figures, $150000 or $200000 a month. Were there are huge differences? Or was it just, I don't know. Sam Ovens: I mean one thing, this is the clear biggest thing that is there is just time, focus, energy, commitment and consistency. It was probably the most powerful variables in any equation. When I channeled everything into it, it lit up. And so that's the huge first thing and not having split focus between different things. And then within that business having focus again. So really focusing on one product and really focusing on one funnel. And that means that I can just really do all these things and building multiple versions of the product. So as you start selling lots of people in, you'll start to notice the holes in your product. And those are common questions that will come up in the Q&As, common questions in the Facebook group and common sticking points that you'll notice or confusion points that people have. Sam Ovens: And you need to scale, you need to patch these holes. Because otherwise the more water you put into that thing the more it's just going to flush out and that creates issues because that's customer support issues that might be flaring up like customer satisfaction issues and you have to mitigate all of that, you have to really manage it because there's no way to scale up really high with something that is pissing people off. Otherwise you just go on a scale, you're going to build a mob of people that will hate you and then you'll probably get arrested so you can't do that. So you've really got to mitigate that a lot and make the product really really good. I think the biggest jump for me just came when I realized that the value was everything. And I just let go of podcasts and social media and keeping up with what people were doing and I just let go of all that crap. Sam Ovens: And all those myths that exist of EMRA and multiple funnels and having a book and then being Amazon bestseller, you know all that crap just got rid of it all. And I just focused on really solving my customers problem the best I possibly could and kind of taking it to another level. As a student I had always gone through these courses and I still loved them so was like this is so cool, it's like a map that shows you where to go and stuff. But there is always stuff missing every single time. And sometimes I was really? They'd say here's the like fun out of you says the marketing automation. Here's the emails even but then they wouldn't give us the landing pages and what was on those landing pages. And then if there was a video on that what was in that then they wouldn't discuss what to sell. Cool, I know how to use Facebook ads and I know how to do funnels but what the hell am I selling? Sam Ovens: There was always gaps, just big gaping wide gaps everywhere. And that always irritated me and I was like, imagine if someone just did make a perfect program. And so I just had in my mind that I wanted to do that. I wanted to make it so that it wasn't that gaps and that it was detailed and the everything in it. As soon as you thought, “Well, how do I do that.” It's like bam, there it is and you're like man this thing is just reading my mind. And when you do that honestly, how do you create good ads? Well an ad is a framework where you input information. An ad is a framework and you input information. The thing that makes an ad good is not the mastering of the framework, it is the quality of the information that you are able to input. And so if you have a really good product and really good results and happy students and all this, you can input really good information into this framework called an ad. Sam Ovens: And so you'll get way better at advertising than people focusing advertising by not focusing on advertising and focusing on product because you can say cooler shit than they can. And they're like, “Damn, I can't say that.” Because I don't have it. I can't say that because I don't have that either, they're like, “I'm snookard.” They're I know what to do but I can't. It's less about the gimmicks and more about just the reality that it is really great and you can then portray that. So I think that's a huge mental shift. I stopped thinking of myself as a marketer, I don't think of myself as a marketer now either. I actually don't really like marketing at all or sales, it's just a necessary thing I have to do in order to sell my thing. But really I just think of myself as a problem solver or an engineer and I'm looking at a problem and I'm trying to solve it in the most efficient, effective way humanly possible and then provide people with that framework. And then if I do that then everything else looks after itself. Makes sense. Speaker 2: Is what we do as business owners, we're firefighters that constantly put out fires. I think that's something a lot of people undermine as business owners. Great business owners are the guys who are able to find solutions to problems, period. Sam Ovens: They're not a showman. Speaker 2: Yes, not at all. Sam Ovens: Those are called actors. And if they say they are an actor we will love them like Leonardo DiCaprio he's great at acting but he doesn't try to act in business. I swear there's a mutated breed in business these days of people who are actors and they somehow believe that business is the sum of their skill of acting which is kind of messed up. Speaker 2: Last question. New York versus Cali, what made that move for you important? Sam Ovens: So probably one of the largest variables in that was my wife because she hated New York. Because she's from New Zealand which is quite quiet and there's lots of nature and then she was from the quietest parts of New Zealand and in a small farm town. So she grew up with nature and all that. And then coming to New York, the Winters are harsh, the Summers can get quite hot it's all city and everything and she didn't like it and she loved Venus and California. And her happiness level directly affects my happiness level which then directly affects my work and my outcomes. So a huge part of it was just to make my wife happy which therefore makes me happy and everything. But also I had a bit of that too. I definitely I'm hypersensitive to things. I'll see things that other people can't see and also hear things and smell things. When I walk around a house I can almost hear the light bulbs going zzzz. And so when I'm in a place that's crowded man I'm getting panicky. So I didn't like really going outside the area or anything which. Speaker 2: I noticed it. I noticed on your Instagram stories it's been a problem for days. Sam Ovens: I would stay in there for 7 to 10 days at the time. I'd only come out because my wife she wanted me to go out and I had to to make her happy. So yeah California is good for that because it's nice outside. And then the last portion of it was there's just, we are increasingly needing more engineering talent like software engineers and things and here is just way more of them over here than there is on the other side because a lot of them come from Silicon Valley, there's a lot in L.A. and they're more common here, more available here and so it's a talent play, a wife satisfaction play and also a personal satisfaction play. Speaker 2: We're looking to open our office in L.A next year, we will be neighbors kind of. Sam Ovens: Where do you live right now? Speaker 2: Right now in Baltimore and then we also have our main headquarters in London and so we're looking to come out to Cali next year. Look at a couple spots downtown. I heard downtown in L.A. is nuts like. Traffic a lot is crazy. Sam Ovens: I've never even been there. It's probably going to take me an hour or an hour and a half to go there and I'm not going to waste that. That's why I like Venus because I'm in close proximity to all possible things that I need without ... That's what I like about it so I don't have to get stuck in that traffic because I will not commute. To me that is the definition of waste, a human body in transit. It ain't doing anything, it's just waiting. Speaker 2: That it's so funny. You're a bit of a recluse a little bit you just kind of like being in your own space and not having that distraction or having it tampered with by other things that are unnecessarily. You threw your focus, you threw productivity so all of that important. Sam Ovens: Yeah it is also just started I don't like doing things that I don't like doing. I think a lot of people just kind of think that they have to in this life. But I'm like screw that. If I don't like doing so I won't do it. If I have to do something that I don't like doing in order to achieve my goal which I do like achieving, I will still go through the pain. You can't get this philosophy the wrong way because I have to do things that I don't want to do every day all the time and I will have to for the rest of my life. But I don't like doing this class differently. I don't like doing things I don't like doing that are totally unnecessary. That's what I don't like doing. And commuting is one of those, it does not feed a goal, it adds value to nobody's life and I don't like doing it. So therefore it should be eliminated. Speaker 2: I think cooking is the second thing on your list after commuting. Sam Ovens: If I liked cooking I would want to cook and I think people who like cooking should cook, I just don't like it so I don't want to do it. Speaker 2: That's funny. Yeah that makes sense though, makes a ton of sense. Sam Ovens: Well thanks for jumping on with me and we should do a catch up call soon like six months, one year. And make sure you focus. Speaker 2: Definitely man. Appreciate all the insight today and definitely a lot to think about and lots I can take use and apply and should make a big difference. There's going to be a strong fourth quarter, I'm looking forward to it for sure. And I'm always I'm always watching what you do as well as listening. I noticed the Q&A calls you do, you're a lot more active on social media as well than you were a year ago, two years ago and that's something I think also that I work on myself as well. So yeah man, I appreciate everything that you've done so far, this is great. Sam Ovens: Cool, let's speak soon. Speaker 2: Oh man, enjoy the rest of your day man. It's about lunch time, what do you got planned? Sam Ovens: Work. Speaker 2: No lunch no food for you? Sam Ovens: I got lunch but it'll be at 12:30 and it's 10:30. Speaker 2: Right, you guys are three hours behind, cool man. I'm about to grab a late lunch and have a Fogo's addiction. Fogo de Chaos is my favorite restaurant. So I'll race over there get some food and then back to work for me too. Thanks for everything today. Sam Ovens: Aright, we'll speak soon. Speaker 2: Alright Sam, have a good one.

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