Key Traits of a growing business – Entrepreneur to Millionaire

  • by

Sometimes organizations fail to change fast and stick with the age old and probably obsolete metrics/ways to keep themselves growing. This is a risky proposition and often results in failure. Leaders who are stuck on old parameters to gauge the success and failures of their companies often play an active role in an organization’s demise. So, while it is important to stay consistent, it is also important for leaders and organizations to keep evolving, challenging the status quo, and keep pushing the walls. This gives the leaders the new/relevant lens to gauge where their company stands and where it must head.

Kent Billingsley, author of Entrepreneur to Millionaire has a lot to say about this topic through his book. Let’s dive in.

Why do most entrepreneurs and business owners fail?

Because they never learn how to truly create wealth with their business.  They only learn how to “run” a business – hoping to make money.  And now, with the Covid-19 pandemic, too many are running into the ground. Creating wealth in a company is when you maximize the ability to create cash on hand, generate consistent cash flow, and produce obscene amounts of working capital.  That business wealth comes from scaling sales, revenue and profits using the fewest resources, least amount of money and almost no time doing it.  The fastest, smartest and most proven way to generate more sales, revenue and profits using the fewest resources, is to use a methodology to leverage, unlock, and scale ALL the areas of a company, not just the employees, to create more new client demand and convert that demand quickly.  Basically, make a lot more money and profits and not lift a finger doing it.

For example, messaging is a huge part of a business, and when executed well, can create amazing demand and help convert that new demand into contracts and cash quite quickly.  However, most company messaging is dull, boring, non-differentiating, and doesn’t compel action.  One of our clients went to the same event every year and was allowed to give a quick “pitch” about their company to the same size audience, about a hundred attendees. After learning how to rebuild their pitch through leveraging a compelling and differentiating value proposition they generated ten times more leads – from 2 leads to almost twenty.  That value proposition is now on the front of their website, is part of all their collateral, is the beginning of every presentation, and is the focus of every proposal.  Their sales win rates have tripled, and their sales cycles are almost 50% faster.  That’s leverage and scale by waking up a sleepy area of a company.  There are dozens of zombie (exists but dead) areas like that in every business. More sales – for no additional costs – creates huge profits and wealth and it is how entrepreneurs and employees become embarrassingly rich.    

Why do so many leaders still rely on last century’s paradigm of business growth and what needs to change?

Because this approach of following the philosophy of “more from more” and “spend more to make more” – as stale as it is – it still works to some degree.  Success, on even a micro level, can be the worst form of validation which drives repetition.  In addition, the limiting philosophy is backed up by another last-century business belief of, “If it ain’t broke don’t fix it.”  This is why 99% of all entrepreneurs and CEOs never generate enough high-quality leads for their business and nine out of ten of sales teams never achieve greater than 30%-sales win rates.  Humans are super slow to change, especially if they have had any type of reinforcing success.

What is the biggest myth about entrepreneurial success today?

Entrepreneurial success is all about personality traits.  There must be a thousand books, speakers and articles all pushing the qualities and characteristics it takes to be an entrepreneur.  They talk about drive, passion, resistance, willingness to fail, no fear, curiosity, motivation, ambition, etc.  Notice that list doesn’t even have any form of skills on it?  Let alone competencies – clusters of skills. Another major entrepreneurial success myth is that if you start, build, and grow a company you will make a lot of money.  And the bigger the company the more money you will make. False. There is no correlation between having a business or growing a business to making a lot of money with a business. 

What entrepreneurs and their teams must learn how to do is create wealth with their business.  That means creating sales, revenue and profits without spending money doing it.  They must work to create “no cost growth and profits.”  In the past all it took was superior products and services.  Those days are gone and will never come back.  Today, there is no golden key to riches, but there is a combination lock to unlock the wealth potential in a company.  What we have developed and proven is a formula that works in all types and size of companies that can produce more wealth – cash, cash flow and working capital – without using more resources. 

How is your “Revenue Growth” model counterintuitive to most common business thinking?

There are dozens of counterintuitive ways we show entrepreneurs and business leaders how to create extreme wealth with their companies. First and foremost, instead of following the last century and company wealth destruction thinking of “more from more,” we show entrepreneurs and leaders how to create “more from less,” but not by cost cutting, abusing employees or beating up vendors.

One of the most important counterintuitive concepts that clients learn in our programs is the difference between “business growth” and “revenue growth”.  I know these concepts can sound the same and can be interchangeable. However, it’s the subtle and redefinition of the second terms that determines if a company creates wealth or not.  What I mean by that is Business growth is almost always “adding” to get bigger. Adding more clients, more contract, more services, more employees, more infrastructure.  When you add things, a business adds costs.  And that eats profits. If you want to make “some money” that’s fine.

If you want to optimize profits and money making – create serious wealth with your business – you must apply this thinking of “revenue growth” – not adding but scaling against an asset.  Which means growing, revenue against an asset in your company.  For example, if a client is worth $100K to a business, then they would have to bring on 10 clients to make a million dollars.  However, what if your company was designed so that clients bought three times as much?  Then you would only need slightly more than three clients to make a million dollars.  What is that so critical?  Because generating more revenue per asset (client) lowers costs of marketing and sales, and also usually requires less infrastructure, management and support.  That saves huge costs which dramatically increases profits – that is how “creating wealth”.  When you can apply that concept of “revenue growth” to every asset – new sales, your offerings, your employees, your locations, your existing clients, etc you can optimize and scale profits faster and with must less effort.  A powerful way to track and measure is if size of contracts are getting larger, or customer spend is increasing, or client account penetration is expanding. 

Another counterintuitive concept is shattering the mantra of “don’t work harder, work smarter.”  Sounds clever, but the thinking slows growth and creates barriers to profitability. The great flaw to this adage is that the leader or employees are still working.  Every company has dozens to hundreds of areas that when “awoken” and leveraged can produce new clients, more profits, greater sales, and faster buyer decision cycles – without a human lifting a finger. One of the biggest ways we help entrepreneurs create wealth with their businesses and become millionaires is to throw out the stale model of “functional efforts.’  Meaning marketing does marketing, sales does sales, etc.  In our models I show everything from start-ups to billion-dollar firms how to leverage their enterprise – every client facing department working as a holistic system – to create more demand (client attraction) and convert that demand (contact to contracts) faster and use fewer resources.  Another one of the major transformational approaches we use to create explosive growth and company wealth is to eliminate the risk of the department superstar.  Too many entrepreneurs and companies have departments that revolve around some “hero.”  The sales hero, the technical guru, the operations whizz, the technical geek elite, etc.  You do want to have talent throughout your company, but you don’t want the future success of your business dependent up on humans.  It’s too high risk and doesn’t scale revenue and profit production.

What’s missing from the thousands of businesses that are failing in record numbers today?

Money – not enough cash on hand, poor cash flow, little working capital.  99% of all companies are struggling with sales, new revenues and profit making – which creates cash problems.  And the entrepreneurs and leaders are blaming their issues on Covid-19. However, the pandemic is just a symptom.  The root cause of companies failing is because of following a flawed design from last century. Too many business leaders are using a model that is based on trading their products, services or time for dollars.  That doesn’t scale sales or produce huge profits.

Our clients have proven that to win big today and make a lot of money your business must be designed to make money – create wealth.  Right now, and especially because of things like a pandemic you must transition from trading for dollars to leveraging and scaling a system to produce the most sales, revenue, and profits possible. You must look at your company not as an enterprise but as a system for profitable growth. Every chapter in the book is designed to show business leaders how to make more money using fewer resources – in a systems approach. That scalable revenue growth methodology creates ridiculous profitability – solving most cash and cash flow problems. I’m confident thousands of companies, representing a million employees, could still be open during the pandemic if they learned and applied system thinking concepts. 

The future of work means differently to each one of us: some see it as more technology and less human, some expect a more humanized space and some others imagine it to be a no-workplace world. In our journey to unwrap FutureofWork, invites leaders from various industries to help our global community to understand what the posterity holds for workers, leaders and organizations. While our team is busy at bringing this fresh ideas directly to you, we would appreciate our community help in making it possible. If you like what you’ve read, we would appreciate if you could spread the word within your circles and let us know if anything you want us to bring into this #FutureOfWork conversation.

Originally posted at Work2.0

Originally posted at AnalyticsWeek

Originally posted at Work 2.0