My guess is that since you started your business you’ve been trying to make money.
It’s all about the funnels, isn’t it? Fill the funnels with leads, squeeze out the sales, and serve clients. Rinse and repeat. You’ve been playing this game from the beginning because cashflow is the lifeblood of a business, right? I mean, what’s a business without revenue?
This can quickly become a trap, though, and it can put a cap on your business’ growth.
To understand why, let’s take a look at three important factors that are true of most small (and online) businesses.
The owner is doing a vast majority of the work in the business.
The owner has to extract a large portion of money from the business to support themselves.
The owner doesn’t know the difference between building a business and building a job.
If any of these three things is true for you, then your business will never grow to the level you want.
I’ll break down why in a moment, but first let me tell you the solution.
Stop trying to make money and start focusing on how you’re going to build a business that makes money.
It’s a subtle but important mindset shift.
Here’s how it needs to play out in your business.
If you’re doing the vast majority of the work in the business, there’s an automatic cap on growth.
Sales and service are two very different things. If you’re doing the majority of the work in the business, there’s two big problems:
There’s very little time to work on your business (in terms of vision, strategy, team building, etc.).
You can’t get more clients and service more clients at the same time.
Even if you hire a sales person to make sure the sales keep rolling in, the business has no one to consistently engage in high level, business building tasks.
What do owners constantly tell themselves, though?
“I’ve gotta service these clients so we can make more money.”
Nope. You need to stop trying to make more money right now and focus on how you’re going to build a business that makes money.
Who can you hire and onboard so that in six months they can completely take over one part of the servicing of clients, freeing up more time for you to do more important business building activities?
Go find that person because until you do, you’ll never breakthrough to the next level.
If you have to take a lot out of the business to support yourself, there’s an automatic cap on growth.
Here’s another thing entrepreneurs say all the time: “I need to make more money just to pay the bills.”
What happens next is a business tragedy. The business owner, who is also likely doing all the work in the business as well, starts taking “anyone and everyone” on as a client.
Standards go out the window and rates begin to drop because “every dollar counts.” This overloads the system and the owner and creates a vicious cycle that’s hard to escape.
Trying to make more money is the root of this problem and the only solution is to push pause and start focusing instead on how to build a healthier business that makes money.
If you’re not already living on beans and rice, what can you cut out of your personal budget to allow you to re-invest more money in your business’ infrastructure?
Are there things you can cut from your business expenses so that money can be re-allocated to team building or spent on acquiring higher value clients?
These are the higher level business problems you should be working on. But “ain’t nobody got time fo’ dat” if all your focus is on making the next dollar right now.
If you don’t know the difference between building a business and building a job, you’ll always be stuck.
This is the classic “E-Myth” and it’s the bane of every freelancer’s existence. It stems from the idea that, “I’m good at something, so I should build a business and work for myself instead of someone else.”
If that’s what you think a business is, you’re not going to build a business, you’re going to build a job.
Think about a piano teacher. They say, “I’m good at piano so I’ll start a business giving people piano lessons.” So, they start up, get some clients, and all goes well until they realize that there’s a very low ceiling on their piano teaching “business.”
There are only so many students they can teach in a day. The rates only go so high. And they’re teaching piano so much that they don’t have time for anything else.
Oh, and they’re starting to hate the piano.
To build a real piano teaching business, one of two things needs to happen:
Build a team of piano teachers so they can scale the business (which requires they themselves stop teaching piano).
Productize piano lessons, perhaps by creating an online piano school where people all over the world can buy piano courses, allowing the piano business to scale indefinitely.
Those are two examples of building a business instead of a job and neither of them involve making more money this week.
When you stop trying to make money for your business and you start focusing on how to build a business that makes money for you, that’s when you’ll move closer to freedom.
What can you do this week to create a business that makes money for you? Tell me in the comments. And if you want 6 more power tips, learn more about how to grow your online business (all the tips apply to brick and mortar businesses, too).
Kevin Michael Geary is the founder of Six-Figure Grind and the Six-Figure Grind podcast. He’s on a mission to help you build a successful online lifestyle business, escape the rat race, and live life without limitations. Connect with @thekevingeary on Twitter.