Many entrepreneurs get stuck with the question, “What do I need to do next?” Most especially in this uncertain environment of COVID-19, it has become harder and harder to foresee the next steps to growth. Good thing that in this episode, Scott Carson interviews someone who is known as America’s Business Alchemist, Bill Prater. A business coach and consultant, Bill talks about the biggest things holding back growth with business owners and why replacing yourself is the fastest path to success. Sometimes, all we need is to let go and make our businesses learn to stand on its own. Follow Scott and Bill as they tackle how you can create a boss-dependent business so you can weather tough times and continue pushing for growth.
Listen to the podcast here:
Scaling Your Business From Boss-Dependent To Independence With America’s Business Alchemist Bill Prater
I know that many of you are business owners, whether your experience getting your feet wet or brand new to it, are all looking to different things to grow your business, to figure out, “What do I need to do next?” What do you need to do to grow your business? We’re fortunate to have who’s known across the country as America’s Business Alchemist. He is been helping business owners and entrepreneurs break free of inertia and accelerate to the future that they dream of. I know that as we get in through this COVID and Corona, many of you are planning things for 2021, starting to get rocking and rolling already like I am. We are honored to have Bill Prater join us on the show. What’s going on, Bill? I’m glad to have you.
It’s good to be here.
You work with many business owners and entrepreneurs out there. With our readers being real estate investors and trying to do some great things, I’m sure you’ve probably got a shortlist of things that you see entrepreneurs struggle with on a regular basis, whether it’s limiting beliefs or actions that keep them from seeing a lot of growth momentum and we’re moving on. Do you want to share any of those things with us?
I’ll give a little more context to my background, which would help because I’ve only done two things in my life. Both of which focused on helping entrepreneurs and business owners. One thing with two different approaches. Number one, I used to own and sold investment banking firms. I raised a little over $1.7 billion in relatively small chunks, but then I made $2 million or $3 million up to $25 million or $30 million roughly in that range. Those were investments directly into businesses, not into a project like a real estate project. I sold that business and then continued helping mentor the same group of people, entrepreneurs, and business owners. Through all of that experience, the best way to get your head around it as a business owner entrepreneur is that it’s literally another investment. When you make your investment, either writing a check or a series of checks or going without your paycheck or whatever you’re doing to finance your business including getting outside investor puts them in, at the end of the day, what you’re trying to do is get a return on your investment.
Even a return on time a lot of times too.
I’m getting to that particular point. We’re talking about private businesses. We can go to all the stockbrokers up and say, “I want to buy some stock in Apple computer.” That is a business to adult, but we’re talking about businesses that we all, ourselves. There are three stages. Let’s call those horizontal stages and then three vertical stages. I’ll use the term boss. When you start, it goes like this, “Boss is the business.” In other words, we start and we do everything. That’s a combination of, “Where the guys do the idea? We’re going to do it all because it’s got to be done right.” That is an unscalable model and nobody’s going to buy it. You’re not going to make enough money to invest with Scott in real estate or anything else because you and your business are exactly the same. You’re joint at the hip.
Believe it or not, 83% of the businesses that start, never make it to the second stage. That’s what I call, a boss dependent business. Meaning that you’ve got staff. Maybe they’re virtual assistants or contractors. You’ve got other people helping you, but the business depends on you. Meaning that you are the person that all the decisions have to go through. If you’re going to hire somebody, you’re the one that has to interview with them at the end before the person is hired.
If there’s going to be some owners paid to your staff, you’re the one that makes that decision. That’s a boss dependent business. Nobody is going to buy that business. It’s not worth anything, except what it’s generated as far as income. Sometimes people can have a nice business that’s boss dependent. That was never going to be sold, but it does enable you to make a lot of potential extra money. You can take that extra money and you can buy a note that a bank is foreclosed on. That would be phase number two.
We see a lot of our students that do that. They start off, they are in the business, they may add business too, but they’re still the focal point of having to make all the key decisions. It takes off into the third phase on your horizontal stages.
The third phase is where you’ve got a business, which I call boss independent. Meaning that you’re not essential nor vital. It’s not important. If you’ve got a business like that and for example, Scott or I happen to like it, we can buy that business and say goodbye to you because the business would be independent of you. The boss and your business is the same, the business depends on you, and your business is totally independent of you and can operate on its own. You can get on a phone call say, “Scott, what do you got?” Scott goes, “Here’s the deal. Come to this meeting. Go online, we’ll have a Zoom call and I’ll explain it all to you.” You can go do that without worrying about your business. Those are the three horizontal stages. Each of you reading can easily put yourself someplace along that continuum. You might be making the transition, but you can envision yourself. Maybe the best way to say is, “Trapped all the way to free.”
Going from self-employed to the business owner, truly a business owner aspect that people are familiar with the cashflow quadrant.
It’s because a lot of times people will look at you as a business owner and say, “You don’t have to work for Microsoft anymore. You’re lucky.” You’re going, “All I got to do is work. I worked 75 hours a week.” Other people think you’re doing right. You’re the only one that knows that you’re not. Maybe your partner knows too. As we get to this business independence stage, then it’s time to move vertically. By moving vertically, let’s call everything in the first 2/3 for sure would be ordinary businesses, solopreneurs, and small business owners with staff. Those are ordinary businesses.
What I mean by that is if you look at the bell curve of businesses, your business, if you’ve got one of those, it’s someplace in the middle of your niche or your industry. Let’s get over here to the scarce land. There aren’t many people over here that have gotten anything resembling a business that’s independent of you, but it could be still ordinary. Maybe you’re a little bit right-shifted, but you’re in the middle of the industry norms. Working you go from here. Vertical up the elevator and then the next stage that you’re going to get to is extraordinary. You’ve gone from an ordinary business to an extraordinary one. Now, it’s worth much more money.
People are drawn to it. They’re asking how they can invest and buy it from you. Scott, you’ve experienced that yourself in your own business, I know. That’s an extraordinary business and there aren’t many. We’re not talking about 3% or 4% or 5% of the whole niche. The whole industry becomes extraordinary, but there’s more because you can take an extraordinary business and make it become preeminent. If you think about Scott Carson’s business, it’s a preeminent business. It’s internationally known. You yourself, you know where you physically are, reading and thinking, “I know about Scott. He’s an elite player in his industry.” Extraordinary to preeminent.
When you get to be preeminent, are there more? Yes, there is. There’s market domination or market mastery. If you think about public figures, companies that have reached that position, people like Elon Musk with Tesla and SpaceX. Those are market masteries and number one in their position. If you will go move from you are the business to the business is independent of you. Once you get there, you start building on that.
The other going to happen is people have in their brain that you make that move, you go from working 70 hours to 75 to 80 to 90 to 100 to every single waking moment and the exact opposite is true. I’m not saying that Elon Musk doesn’t work, but he doesn’t have to do it if he didn’t want to. Richard Branson, who’s got several companies that are market masters. The number one player in his industry. He doesn’t have to work. You can start thinking about alternative forms of investment. That’s the quick summary. I’ve seen that as somebody investing in the companies to now where I mentor and train business owners and their senior management teams to make the journey I talked about.
On that horizontal to go from being the boss, doesn’t be the same thing. To having a team, we’re still boss-dependent. That’s the biggest jump. Going into that aspect of things, where do you see the bottlenecks or the mine blocks fall in? Is it the fact that they still believe they have to do everything? We’re all a little bit of a control freak in learning that delegation or trying to step away and allow their team to fail and learn from their failures to grow.
Not everyone, but a lot of people are hardwired into seeking what appear to be bargains. In other words, if you can get by with an inexpensive pair of shoes, they’re fine. They got a sole on them and you can lace them up. A lot of people, unfortunately, have that same thinking when they think about people. They think, “I need a project manager.” Project managers are the same as baseball players that range from little leaguers to all-stars. There’s a big range. If you look at our project manager, little leaguers to all-stars, if you genuinely want to be free of your business and rich, then you’ve got to get your brain around the idea that you can’t cheap it out with people. By saying, “I got to figure out how to buy some notes, some loans from banks in a cheap way.” No. That’s not what you want to do. You want to buy that highest quality loan you own possibly can and then figure out, “If I get this high-quality loan, I got a good chance of making the money that I want.”
Mistake number one is not hiring anybody to delegate or hiring somebody that they can’t delegate too because the person doesn’t have enough skill. One, trying to do it all yourself. Two, cheapening out when you hire people. This is easy for Scott and me. Ultimately, we want to hire somebody that’s much more skillful than we are, that can do everything that we ever thought about much better than we did or are able to do, because then it’s easy to delegate because we know they’ll be doing the thing better now. We can effectively promote ourselves from being a doer to being a thinker. Let’s call that get by with a cheap team.
Number two is to make sure that if you own a business that you operate it with a system and methodology of operations. Far too many people operate their businesses in a whack-a-mole fashion. If a problem and opportunity come up, they try to deal with it we would call the pandemic a problem that we’re all in as a problem. Many people weren’t ready for it. The truth is, I didn’t know that that was going to be the problem, but I knew there’s always a big problem. It’s not being prepared for that. Same with opportunities. There are always opportunities. If you’re working as hard as you can possibly work consuming all of your hours, it doesn’t matter what the opportunity is. Scott may call you up and say, “I’ve got a fantastic deal.” If you’re not ready for new opportunities, it’ll sail right by you.
Number one is trying to cheap it out with a team and number two is trying to operate instinctively or reactively. The flip side of that is buying and trying a bunch of shiny pennies, the next new thing. That fits in there as well. Let’s call that all team system. The third common mistake is that people, in general, business owners, we’re talking about all of us, we’ve been taught that dreaming is all for kids. That’s for kindergartners because when you become an adult, you got to think like an adult, you got to deal with the situation that you’re around. You got to operate within your capabilities or operate within your resources. That’s what you have to do. That’s the third mistake, is not allowing yourself to imagine a future that has no limits. That means to start thinking immediately like Richard Branson. You might be a little solopreneur, but think, “I’m going to dominate this market.”
A lot of people stop dreaming. They get used to doing their day in day out job and then they forget about to dream big. that’s where if you want to accomplish it, you’ve got to set a big goal and deconstruct or back engineer what it’s going to take to get to those. Whether it’s numbers-wise, hiring, income-wise, lead sources, whatever you’re producing or what you’re working on you’ve got to know those numbers to get. One of the big things we focus on is our KPIs.
We’re always telling people like, “If you want to hit an income goal with notes, you’ve got to make many offers because you’re only going to close on many.” That means making many phone calls or many emails to asset managers. It’s not you doing everything you’ve got to learn to delegate to either assistants, VAs, or vendors so that you can keep doing the things that you need to do in that forward-thinking, that dreaming of a bigger picture and moving on down the road versus getting stuck. Michael Gerber may be acquainted the best, the E-Myth where you’re the boss, trying to do everything and you’re too much backward-looking versus forward-thinking.
One little sliver in that little whole mix, you teed up from my mind. You know all about torpedoes. Back in World War II, if you were a submarine captain, you spent days trying to figure out where your adversary was going to sail their ship so that you can line your submarine up. When you fired the torpedo, it would intercept your targeting and make it sink. It takes a huge amount of preparation, planning, timing, and patience, while the target gets to port and it’s out of your site already. A lot of business owners run their businesses that way. They think, “If I’m going to get involved in buying notes, loans, real estate, or otherwise, I’m going to study, plan and think.” All of a sudden, the window’s gone.
A modern torpedo, a submarine captain now, if there’s a problem, like a destroyer coming to get in, he or she can immediately fire the torpedo. They’d take action now and then they’d steer the torpedo. The lesson in all of that is you need to take action immediately then steer. Scott told us, “If you’re going to buy a note, you don’t look and finally got the notes. You make the offer, only to find out it closed yesterday. Get lunch, get out there, get the activity going, measure the KPIs, the conversion ratios, and make adjustments. Raise your price, lower your price, change your geography, work with different banks.” The key there is that’s a little bit of part of the thing about systems, but it’s execution. Planning is important, but if somebody wants you to teach a class, all you need to do is to be 1.5-hours ahead of the class. You don’t need to know the whole year. You’re taking the first Monday of the first day of the class. Get ready to do that. That evening, get ready for the next day.
There are many people who study, “I got to have all my ducks in a row. I got to know A to Z.” That’s not always the case. It’s never going to be A to Z at the boards. Maybe A, B, C, and then get rocking and rolling. Know the basics and then start pulling the trigger and learning that on-the-job training, but learn while you’re earning a lot.
Those of us who went to college and got a degree, and you go get a job and the employer says, “What’d you graduate in?” They don’t even bother to ask you because they know it doesn’t do them any good. They’re going to hire you and teach you what to do. In fact, you should not try to learn Scott’s field to the extent that Scott knows it, and you’re much better off to decide, “Do I want to deal with Scott and his company?” Make that decision then get started. That’s the same with hiring somebody. You don’t need to know about project management to hire a project manager. You don’t need to know about Facebook advertising in order to hire somebody, to put a Facebook ad to place for you. You don’t want to do a Facebook adjust because somebody told you it was a fancy idea.
How many shiny objects have entrepreneurs chased over time? That will take you away. The power of saying no is as valuable as saying yes to success a lot of times, because that’s the thing we see, especially in the real estate space. You see people going from workshop to workshop or the idea that, “I’m going to put another tool in my tool belt.” If all you’re doing is nailing nails, you don’t need a jigsaw, you don’t need a jackhammer if you’re never get around to use that aspect of it. That’s the thing that drives me bonkers all the time is entrepreneurs do exactly, “What about Facebook Ads?” Your business doesn’t need Facebook ads right now. You need A, B, and C. Get good at A, B, and C before you add D, E and F. Know your systems before you start delegating. Know you’re going to be doing, but know what you need to delegate to somebody else. I’ve heard it said before, not the how, but the who needs to do it for you. A lot of people are like, “I need to learn it myself. How do I do this?” You need to find somebody who can do it for you versus how.
You have to get things in order or you coached this. We’re picking on the Facebook Ad, but if any shiny penny that somebody tells you about, “That sounds great. Let’s do that.” First, decide what you want to do, “I want to get my business to have twice as much as much revenue as next year as it does this year.” Now, that you’ve made that decision, let’s talk about the potential ways that you can do that. For example, you don’t have to do anything other than double your price. If, in fact, somebody will pay that, you’ll double your sales. You don’t even need any Facebook Ads to double your price, you might need a little nerve. First, dream big. Second, put the plan in place. Third, get the resources, it might be Facebook Ads.
It might be increasing your price or improving your systems. It may be adding value to being the cheapest to try to attract a higher clientele. There’s a lot of things that you can do without a lot of work out there. A lot of people sometimes need somebody at an outside source to look it over the process. They are like, “Have you thought about this?” No, because a lot of times we’re bogged down in the whack-a-mole. We don’t see the opportunities or simple solutions. When you’re sitting down and talking with business owners and you’ve figured out where they’re at, is there any type of assessment or any type of steps that you’d like to take to help flush out their goals or their dreams or things that maybe they see themselves and to help them find success?
The answer is no. Each of us is in our lives, our investments, our businesses and we’re at wherever we are now as a result of everything we did in the past. It doesn’t do us a great deal of good. It’s not much value in going back and looking at all that stuff. Let’s say to ourselves, “As of now, we are here, what do we need to do now to move the ball the furthest distance forward?” That varies from person to person. What I do when I start working with somebody new to me is, I simply say, “Where are you taking this thing? What’s your dream? What’s your hope?” Even if they say, “I don’t have one.”
I said, “Imagine that you’re back in kindergarten. Did you have a dream?” She said, “Yes, I did. I dreamed of being a queen.” I said, “Put that into your business, dream that. What singular thing can you do right now that would move you the furthest way forward?” We don’t watch much thinking. We already said, “Don’t overthink this stuff. Just take action,” because we can steer ourselves once we’re in motion. We want to go forward. That’s a long answer to a quick question. We are where we are as a result of everything in the past, let’s decide where we want to go and what the next steps should be. If you’ve got yourself and five employees, then we need five people to decide what the next step is going to be. If we’ve got yourself in 500 employees, we need to have 500 people to decide what they need to do to move the ball forward. What you do not want is to have people deciding on their own what in the world they’re going to do. We have to say, “This is where we’re going. What are you going to do to move us in that direction?”
I love that because it’s making sure that everybody’s rowing in the same direction, but also talking with your entire staff because if they’re on the frontlines, they’re the ones taking the phone calls or doing the work. That can often give you the answer that maybe you don’t see because you’re not the person doing or handling that specific position over there.
That’s why you always ask each person. You say, “Harriet, what could you do if you don’t get to do one thing now, what would that one thing be?” They’re completely the wrong person on your stand. There’ll be able to say, “I probably should call up such and such a person and collect the $30,000 of that world.” You said, “Solid plan. I commit to doing that.” All of a sudden, tomorrow you’ve got $30,000 that you didn’t have in the past.
Receivables are always a great thing. One of the most important things of that bottom line along, and then making sure looking at holes in our businesses, “Where are we losing money? We all signed up for a lot of different things that we don’t use effectively.” Even if it’s not going out, it’s staying in and that’s sometimes just plugging holes.
A lot of times people say they’ve got such and such an employee and they’re not in sales or they’re not in a position where they can add revenue and so forth. We can run our business on revenue. We run our businesses on net, which means the net cashflow. We can have a $20 million business in net negative $100,000. We can have $100,000 business and net positive $100,000. One thing I do for people on the front line. They know how to save money. You can quickly explain to somebody if you’re making a 10% net that $100 cost savings are equivalent to $1000 sale.
Somebody that can figure out how to save $100 is equal to the hot salesperson that closed the new training program per $1000. That’s what I mean by each person instinctively knows what they need to do to move the ball forward, providing that the boss says, “This is where we’re going.” He sees them every day. “Scott, you’re going to tell me, this is where we’re going.” “Yes. Every day I’m going to tell you where we’re going so you do things that are aligned with my vision, dream, and my kindergarten little guy.”
What’s the best way for our audience to connect with you, to take it to the next level of they’re looking for some help or looking for the Business Alchemist to help them?
They need to go to GetBillsNewBook.com. For $0 and an obligation, they’ll get the PDF copy of that book. It’s called Dynamic Growth: Turning Your Business Into a 24/7 ATM.
Bill, thank you for coming on the show and sharing that stuff. I hope everybody out there takes advantage of that. GetBillsNewBook.com. Download it. It’s a great book out there for you. Check out what Bill’s doing. Bill’s got some great stuff. He’s got rock and roll besides the book. We need advice, we need counsel, don’t be afraid to reach out to people to seek counsel because you never know what an outside view will do for your business and helping you take it to a whole new level. Go out, take some action and we’ll see you all at the top. Bye.
- Bill Prater
- Dynamic Growth: Turning Your Business Into a 24/7 ATM
About Bill Prater
Hi, I am Bill Prater, business owner, entrepreneur, publisher, author, speaker, consultant and coach. I am best known for my long-term success in enabling business owners and leaders to quickly eliminate personal barriers, to rapidly reach their current dreams; and, to embark on a journey of business mastery.
Because of the myriad of businesses I have worked for, owned and consulted for, I have extensive experience with start-ups and mature organizations across diverse industries including, software development, online marketing, biomedical laboratories, high technology, internet, energy, retail, communications, banking and finance, distribution, manufacturing, consumer products, real estate; and, many more.
I have discovered the problems, issues, and challenges facing business owners are pretty much the same regardless of the industry.
My focus has been on enhancing profitability and business value while at the same time enabling peace of mind for the owners.
I created philosophies, training, techniques, systems, and procedures to conquer these obstacles and to capture new opportunities. All of this is contained in Scaleology®; Business Mastery System™ and related products and services.
For example, I created Business Mastery Secrets to deliver online leadership and management training and coaching programs. These online lessons range from single topical management short courses to year-long intensive programs.
Earlier in my career, I excelled in sales, sales training and sales management at IBM in its computer division.
As the national sales manager and a partner in the country’s largest oil and gas securities firm, I raised more than $750 million of equity capital in eight years. I recruited, trained and led more than one hundred sales professionals in achieving average revenue growth of 100% annually.
As a board member, consultant, coach, and trusted adviser, I have provided leadership to numerous businesses; designed strategic and tactical plans; served as interim management; and recruited senior executive staff, board members and other key personnel. I’ve structured, advised and financed corporations, joint ventures, partnerships, leveraged buyouts, acquisitions, mergers, and divestitures.
Throughout my career, I’ve been acknowledged as an accomplished entrepreneur and a strategy-based, self-driven professional who models and propels high levels of achievement in individuals and teams.
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