Dan Martell - June 28, 2021


How To Buy Back Your Time & Increase Profit


Episode Stats


Length

11 minutes

Words per minute

196.34717

Word count

2,168

Sentence count

122

Harmful content

Misogyny

1

sentences flagged


Summary

Summaries generated with gmurro/bart-large-finetuned-filtered-spotify-podcast-summ .

In this episode, I share with you how to buy back your time to increase your profit. If you feel like you re frustrated, you ve got way too many direct reports, you finish your day and you re wondering what did actually get done? And literally, growing will cause more pain to you? Then you need to listen to this piece.

Transcript

Transcript generated with Whisper (turbo).
Misogyny classifications generated with MilaNLProc/bert-base-uncased-ear-misogyny .
00:00:00.080 If everybody at your organization
00:00:02.640 is understanding this principle in hiring,
00:00:05.400 not to add capacity, but to free their time up
00:00:08.920 so they can work in more of their genius,
00:00:11.040 their unique ability, it's a game changer.
00:00:26.600 Hey there, Dan Martell here,
00:00:27.680 a serial entrepreneur, investor, and creator of SaaS Academy.
00:00:30.240 In this episode, I'm gonna share with you
00:00:31.920 how to buy back your time to increase your profit.
00:00:36.060 It's literally, if you feel like you're frustrated,
00:00:38.760 you've got way too many direct reports,
00:00:40.520 you finish your day and you're wondering
00:00:42.160 what did actually get done,
00:00:43.820 and literally growing will cause more pain to you,
00:00:48.060 then you need to absolutely listen to this piece.
00:00:50.960 I'm gonna share with you how I teach my clients
00:00:53.440 to strategically buy back their time
00:00:55.700 in a way that's more profitable,
00:00:57.300 and it creates a business they don't grow to hate.
00:01:00.600 And be sure to stay at the end
00:01:01.440 where I'm gonna tell you how to get access
00:01:02.760 to my exclusive download, The Next Hire Focuser.
00:01:06.120 It's the worksheet that I use with my clients
00:01:08.480 to help them walk through exactly
00:01:10.100 where they should be focusing their hiring plan
00:01:12.980 to buy back their time in the most profitable way.
00:01:15.360 So I wouldn't be exaggerating if I said,
00:01:17.440 this is probably the most important topic
00:01:20.840 that I talk to my coaching clients about.
00:01:23.740 And the reason why is I've learned
00:01:26.180 that if we don't learn how to hire people
00:01:29.220 in the right sequence,
00:01:30.600 that we'll eventually grow a business that is painful.
00:01:34.700 That the more we grow,
00:01:36.280 we'll literally like be driving with the handbrake on.
00:01:39.240 We won't wanna push on the gas
00:01:40.560 because it hurts, okay?
00:01:42.040 It sacrifices our time, it zaps our energy.
00:01:45.320 You know, and the other day I was talking
00:01:46.520 to one of my coaching clients, Owen,
00:01:47.860 and he ran into the same issue.
00:01:49.620 Literally growth in 2020,
00:01:52.880 but started to stagnate and slow
00:01:55.500 because he didn't have the right people infrastructure.
00:01:58.500 He didn't make the right hiring because for him,
00:02:01.040 a lot of times when we're hurting,
00:02:03.160 it's because we think the next hire is an expensive hire.
00:02:05.940 Okay, it's a VP, it's an operations person.
00:02:08.900 Here's right off the bat.
00:02:10.340 If you're thinking of hiring an operations person
00:02:12.580 and you don't have a personal assistant, start there.
00:02:15.620 Like you never hire somebody to operate your business
00:02:18.800 if you don't have an executive assistant
00:02:20.520 taking care of that type of stuff to free up your time.
00:02:22.880 So I'm just gonna give you that quick one,
00:02:24.520 I'm gonna jump into the four key strategies
00:02:27.980 that you need to consider to really understand the mindset,
00:02:31.000 the beliefs and the tactics to buy back your time.
00:02:33.440 Number one, the buyback principle.
00:02:36.020 So the first off, when people ask me,
00:02:37.460 what does that mean, the buyback principle?
00:02:39.120 Here's what it means.
00:02:40.700 It means when entrepreneurs, okay,
00:02:43.860 will not grow into pain.
00:02:46.180 So if there's this threshold of pain, you growing,
00:02:49.520 if it means more pain, you won't do it.
00:02:52.000 How does that show up in your business?
00:02:53.320 Well, it means that you're slow to reply to emails.
00:02:55.520 You don't follow up an introduction
00:02:56.880 to potential partnerships.
00:02:58.220 You don't aggressively go for the close
00:03:01.080 when you have a sales call.
00:03:02.540 You don't build certain features
00:03:05.920 because it's gonna take a lot of time
00:03:07.500 to map out the product roadmap or whatever it is.
00:03:10.360 But essentially it's painful for you to grow.
00:03:12.080 If you sell, you gotta deliver, you gotta activate,
00:03:14.220 you gotta onboard, there's all these things.
00:03:16.200 And what I've discovered is most people, when they do hire,
00:03:19.260 they hire people to just add capacity.
00:03:23.180 They hire a developer, they hire a support person,
00:03:25.520 they hire a frontline worker, whatever, which isn't bad.
00:03:28.400 But the problem is, is that if you do that a lot,
00:03:31.100 eventually, usually around 12 employees,
00:03:33.200 you're gonna get overwhelmed.
00:03:34.400 You're gonna hire a bunch of people to add capacity,
00:03:37.920 but it actually doesn't free up your time.
00:03:40.860 So what you wanna do instead is the buyback principle
00:03:43.340 is 100% focused on shifting the hiring
00:03:45.720 from just hiring for capacity
00:03:47.560 to instead hire for capability.
00:03:50.040 Capability means you freeing up your time
00:03:52.660 to be more capable to invest higher value time of yours
00:03:56.760 into revenue generating activities, okay?
00:03:59.420 So it's to buy back the lower value activities
00:04:02.460 so that you can focus on higher value activities
00:04:05.160 from your calendar.
00:04:07.320 Why is that important?
00:04:08.540 Because just think about this.
00:04:09.440 If you had a calendar and you,
00:04:11.280 or you looked at your calendar,
00:04:12.420 you said, here are all the things I've done last two weeks.
00:04:14.080 And you just highlighted, you know,
00:04:15.700 groups of things, either red, they zap my energy
00:04:18.640 and they, I hate doing this or green, I love doing this.
00:04:21.460 and you looked at it, it could be maybe today, 60% red.
00:04:26.180 Maybe it's only 40% red, but imagine this.
00:04:28.920 What if your calendar was all green?
00:04:31.480 What if you woke up and all the work you worked on,
00:04:34.480 you did was stuff that energized you,
00:04:36.440 added value to your business,
00:04:37.860 generated revenue and high gross margin,
00:04:40.480 profit to your business.
00:04:42.240 You would transform the way you attack the day.
00:04:44.720 You would jump out of bed ready to hit your work.
00:04:47.240 You would be motivated to talk to customers,
00:04:50.200 talk to partners, talk to anybody that could help you scale up
00:04:53.620 because it would mean more of that.
00:04:55.300 And that's the opportunity.
00:04:56.600 That is the buyback principle.
00:04:58.000 And that's the number one thing you need to understand
00:04:59.800 is that we're buying to get time out of your calendar.
00:05:02.760 Number two, calculate your EHR.
00:05:05.240 So your EHR stands for effective hourly rate.
00:05:08.080 Here's a simple equation.
00:05:09.700 If you take your revenue, okay?
00:05:11.260 And you just call it a million dollars, okay?
00:05:13.040 Or even your ambition this year,
00:05:14.560 if you wanna get to a million dollar revenue
00:05:15.980 and you divide it by 2000,
00:05:17.500 which is about the amount of hours
00:05:18.900 that a person's gonna work in a year.
00:05:20.660 That means your hour is worth $500, okay, $500.
00:05:25.840 Well, if you look at like the list of tasks
00:05:29.700 that you're working on throughout a two week period,
00:05:32.580 there's 80% that are low value, okay, the 80-20 rule.
00:05:36.860 And there's 20% that are high value,
00:05:38.880 maybe between two to $500 worth of value.
00:05:41.340 These are things like selling, marketing, partnerships,
00:05:44.920 product development potentially, right?
00:05:47.200 But these are things that only you can do
00:05:49.540 or the things that bring you energy
00:05:51.260 that creates a lot of value for your business.
00:05:53.200 Everything else, this long tail of activities
00:05:56.420 needs to get off your plate.
00:05:57.640 So what I say is that if you can hire somebody
00:05:59.400 for a quarter of that value,
00:06:01.200 meaning that if it's $500 an hour, that's 125.
00:06:04.400 You could pretty much hire anybody.
00:06:05.860 Just even think if you're $1,000 or 100,000 a year,
00:06:08.840 that's $50 an hour.
00:06:10.580 Is there anything you can hire people for $12.50
00:06:14.320 to do that's on this line of long tail activities?
00:06:16.900 The answer is yes.
00:06:17.860 You can hire people through sites like Upwork
00:06:20.440 to buy people, to out-task certain functions.
00:06:23.720 Most people think I need to hire a full-time person.
00:06:25.580 No, you don't.
00:06:26.400 Out-task that work using your effective hourly rate
00:06:29.380 as a gauge, okay?
00:06:31.220 So a quarter of your EHR is where you should be looking
00:06:34.540 for opportunities to invest, to buy back time.
00:06:37.120 Number three, hire multiple hats. 0.99
00:06:39.120 Most people, when they hire,
00:06:40.820 they hire one person to do a thing.
00:06:43.040 I need a designer, all they do is design.
00:06:45.180 I need a Facebook person,
00:06:46.200 all they're gonna do is Facebook.
00:06:47.440 I need a whatever, and all they're gonna do is this.
00:06:49.480 Here's my thing.
00:06:50.320 If you look at your calendar
00:06:51.640 and you see these chunks of work, okay?
00:06:54.000 Maybe there's what you'll discover
00:06:55.880 is there's two buckets of type of work.
00:06:57.720 One's more office and operational.
00:06:59.640 The other one's more marketing type tasks,
00:07:01.320 social media, posting, Facebook.
00:07:03.240 What you wanna do then is say,
00:07:04.560 how can I hire for a role
00:07:06.860 that they'll do those three buckets of things?
00:07:09.820 Because there's value in that.
00:07:11.320 So I think that people forget
00:07:13.080 when we started as entrepreneurs,
00:07:14.080 We wore seven hats, 14 hats, a ton of hats.
00:07:16.500 We wore all the hats.
00:07:17.340 And then what we do is we hire people
00:07:18.800 and we hand a hat over.
00:07:20.000 What I'm saying is hand over three hats.
00:07:23.120 Hire somebody who's gonna lead your marketing
00:07:24.900 and say, here's all the things I do in marketing.
00:07:26.720 One, two, three, four, five, six, seven.
00:07:28.160 You now do this.
00:07:29.300 I know you may not have experience, but I trust you.
00:07:32.380 And there's free courses online
00:07:34.040 and there's YouTube videos.
00:07:34.880 Go check out this guy, Dan Martell.
00:07:36.100 He's pretty smart.
00:07:36.940 He's got a bunch of videos on certain things
00:07:38.540 and just hand it to people.
00:07:40.280 I think people underestimate how capable folks are
00:07:44.180 if you actually empower them and you coach them to success
00:07:47.420 and you just say, these are the outcomes
00:07:49.520 that I'm gonna hold you accountable for,
00:07:50.940 figure it out, let me know if you're stuck
00:07:52.940 and every week we're gonna meet
00:07:53.980 and you're gonna show me where you're at
00:07:55.100 and are you making progress?
00:07:56.360 So that to me is one of the big ideas,
00:07:58.880 the aha moments between the buyback principle
00:08:01.140 is you buy back multiple hats,
00:08:03.900 you give groups of activities to one person and say,
00:08:06.400 hey, you're in charge of invoicing, client activation,
00:08:09.700 and receivables, okay?
00:08:12.780 It might sound crazy, but why?
00:08:14.220 Well, because they're working with the customer
00:08:15.600 to activate them.
00:08:16.440 So they should make sure the invoice got done.
00:08:17.620 And if somebody hasn't paid, ask them about it
00:08:19.760 since they have a relationship with the customer.
00:08:20.940 That's what I'm talking about when I say hire
00:08:22.520 for multiple hats.
00:08:23.460 And number four, build throughput.
00:08:25.820 So my whole thing when I look at scaling companies
00:08:30.440 is I'm trying to drive revenue.
00:08:34.220 I'm trying to create throughput amongst my management team.
00:08:37.800 So for me, it's not even that I buy back my time.
00:08:41.900 If you have leadership,
00:08:43.380 you need to teach them how to buy back their time.
00:08:46.040 If everybody at your organization
00:08:48.600 is understanding this principle
00:08:50.280 and hiring not to add capacity,
00:08:53.060 but to free their time up
00:08:54.920 so they can work in more of their genius,
00:08:57.040 their unique ability, it's a game changer.
00:08:59.960 If you just ask people to hire folks to add capacity
00:09:03.920 and it doesn't free up their time,
00:09:05.220 you're gonna burn them out.
00:09:06.480 They're not gonna stick around with you,
00:09:07.600 especially your A players, your A players.
00:09:09.200 So I have like, I hire executive assistants
00:09:11.160 for all my senior leadership team.
00:09:12.540 Why?
00:09:13.380 Because it's the cheapest amount of labor capital
00:09:15.700 I can deploy to have them free up their time
00:09:18.160 to think strategically, to look like,
00:09:20.840 essentially they're in the forest.
00:09:21.940 They got to look up and look over across the forest
00:09:24.080 and say, where are we going?
00:09:24.980 That's strategic thinking.
00:09:26.560 If they're leading a marketing, a sales team,
00:09:29.020 customer success, they need the space
00:09:31.340 in their calendar to do that.
00:09:32.740 And that doesn't happen if we just keep adding people
00:09:35.620 to fill capacity.
00:09:37.060 We need to increase the capability.
00:09:38.740 We need to increase the throughput,
00:09:40.080 what I call management bandwidth,
00:09:41.700 so that you can scale your company even faster.
00:09:44.660 So quick recap, four strategies to buy back your time
00:09:47.120 to increase your profits.
00:09:48.120 Number one, the buyback principle in essence, okay?
00:09:51.780 Number two, to calculate your EHR and use that to hire.
00:09:55.280 Number three, hire for multiple hats.
00:09:57.260 Number four, build throughputs.
00:10:00.280 As I mentioned at the beginning of this episode,
00:10:01.820 I wanna share with you an exclusive resource.
00:10:03.240 It's called the Next Hire Focuser.
00:10:05.140 It's literally the worksheet that I use
00:10:07.480 when I'm coaching clients through this process
00:10:09.540 for them to understand where are you spending your time?
00:10:12.320 What brings you energy?
00:10:13.540 What's valuable to the business?
00:10:15.220 What are the lists of things that you're doing
00:10:16.800 that you could group together and hire that person
00:10:19.300 to make sure that you have a very clear task list of things
00:10:23.080 when you bring that person in.
00:10:24.220 Here's what you're now owning, hand it over to them.
00:10:27.560 Give them guidance, coaching to success.
00:10:29.440 Click the link below to download your copy
00:10:31.400 of my next hire focuser to make your next hire a success.
00:10:36.300 It will free up your time
00:10:37.580 and add tremendous amounts of profit to your business.
00:10:39.860 I'm really excited for you to deploy that.
00:10:41.280 Let me know in the comments how that works out.
00:10:43.340 If you like this video, be sure to subscribe to my channel,
00:10:45.620 smash that like button and share this
00:10:47.600 with any other entrepreneurs you know are struggling
00:10:49.780 and need to consider redeploying their capital
00:10:52.640 into more effective people time.
00:10:55.640 So share that link with somebody you love.
00:10:57.780 As per usual, I wanna challenge you to live a bigger life
00:11:00.680 and a bigger business, and I'll see you next Monday.