Dan Martell - I made $10M to Prove It’s Not About Luck

00:00:00.000 Right now, we've been gone through a whole lot of stuff in the economy, banks crashing,

00:00:04.820 valuations going to a third. And what I want to share with you guys today is how to scale

00:00:10.520 to 10 million, but do it in the craziest environment. If you learn what I'm sharing

00:00:16.140 with you today, not only will you get to the 10 million mark, but more importantly,

00:00:20.580 you guys are going to transform your relationship with chaos. You guys down for that? Yes or yes?

00:00:25.280 Perfect. You guys in the right room.

00:00:26.760 I want to start off by sharing my personal story because when I was 28, I thought I was doing

00:00:35.360 everything right. I had failed my first company at 17, gave it another try at 19, failed again,

00:00:43.620 started consulting, writing code for three or four years. And when I was 24, I finally

00:00:48.860 decided to read a business book. It's crazy that I went so long never reading a business book,

00:00:53.940 but I read the e-myth. And through that process, I decided I need to do this. I need to create

00:01:00.920 a franchise prototype. And I hired a coach named Bob. And Bob was this cool dude out of Toronto.

00:01:06.500 He was a certified e-myth coach. And Bob showed me all the missing pieces around building a

00:01:13.020 business. And because of his mentorship, I was able to finally find success in my third company

00:01:18.960 called Spirit Technologies. And what happened is because I got a taste of success, I kept pulling

00:01:25.140 on that string. I just wanted to win. You got to understand, I went from 17 to 24 trying really

00:01:32.360 hard and just failure after failure. So once I tasted a little bit of what other people would

00:01:39.740 call successful and started generating revenue, I was just all in. And that's what I did for four

00:01:43.560 years. I was working 100 hours a week. I was traveling 250 days a year. If a customer called

00:01:48.940 on a Sunday. I answered the phone. I went to my laptop. I would go to my friend's birthday

00:01:52.920 parties. I remember one time my buddy Nick, he had a birthday party, and I show up

00:01:56.900 with my laptop, and I'm sitting in the living room while there's a full-on

00:02:01.120 party going on to celebrate his birthday, and I'm working on

00:02:04.760 contracts and emails. It's called blue-facing. Do you guys know what blue-facing is?

00:02:09.060 It's when you're in the dark and you've got your phone in your face. You look blue.

00:02:12.340 I was blue-facing at his birthday party, and I thought in my head,

00:02:16.880 I am one of the best friends in the world because I'm so busy, but I still showed up for his party.

00:02:23.320 And he thought to himself, Dan is the most ridiculous dude in the world. That was my

00:02:27.080 mentality. I don't know if you guys can relate to this, but because I had no success for so long,

00:02:32.480 I was worried if I would stop any of that, that everything would slide backwards. Can anybody

00:02:37.620 relate to that where you guys are just doing and doing and you're building momentum and volume and

00:02:41.320 you're just worried if you stop. Well, here's what happened to me. Not only did I build a

00:02:46.980 multimillion-dollar company at 27. I became a millionaire when I was 27. But the downside was

00:02:54.140 one Sunday I was working at the office, and I was supposed to be home for dinner. I was engaged to

00:02:58.200 a woman. We had just bought a new house. And I looked down at 630, and I go, I'm late. I jumped

00:03:05.000 in my car and I rush back and I run up the stairs to our home and I walk into the living room that

00:03:13.900 was open to the kitchen and I see her in tears. And she's just sitting there in the kitchen just

00:03:19.080 beside herself. Like can't even breathe. I don't know if you've ever had somebody just emotionally

00:03:24.320 distraught. And she just looks at me and just takes the ring off and drops it on the counter

00:03:31.000 and just blurts out, I can't do this anymore and leaves

00:03:34.940 and walks right past me, goes and stays with her parents.

00:03:39.320 And it wasn't the first time she had ever shared this with me,

00:03:42.220 but I just knew that time it was different.

00:03:45.760 And this was three months before our wedding day.

00:03:50.220 And it absolutely crushed me because I had been doing everything for us,

00:03:56.120 for our future, for this family we were going to create,

00:03:59.800 to have success.

00:04:02.680 You guys want to hear the craziest part about all this?

00:04:05.500 She never asked me for any of it.

00:04:08.500 Some of you are on this rat race of success,

00:04:13.460 and you're using the excuse of my family, my community,

00:04:18.860 the people paying attention, my employees,

00:04:21.600 but none of them have asked you for any of that, right?

00:04:26.140 And that's where I had to learn these lessons,

00:04:28.300 and I went on a journey.

00:04:29.660 after she left to just try to find myself because i had figured out how to achieve but i didn't

00:04:34.300 understand how to lead even my team i was successful in my business but i had 30 people reporting

00:04:39.420 directly to me and i was explosive i was emotional i would just tell everybody what to do and they

00:04:45.260 would do it out of fear i didn't build a team i didn't build a culture and that's what i want to

00:04:49.660 share with you guys today is how do you scale your leadership to 10 million because there's this

00:04:55.500 philosophy called the law of the lid. John Maxwell talks about it in the 21 irrefutable laws of

00:04:59.820 leadership. And no business will grow past the level of the leader. So if you're in this room

00:05:05.900 and you want to scale to 10 million in ARR, go look in the mirror. Because the only way that's

00:05:11.500 going to happen is if you level up your leadership skills. So are you guys down to learn how to do

00:05:15.640 that? Yes or yes? It's wicked. Let's dive in. So this is, I know how douchey I look when I put

00:05:22.300 this up here. And it's either going to inspire you or trigger you, and I'm totally fine with that.

00:05:27.520 But I share this because this is a picture from a retreat that I do with my wife every quarter.

00:05:33.560 We take three days off. And I want to hopefully sell you on this concept that you can absolutely

00:05:41.120 live a life that's bigger and actually build a bigger business. While I do these quarterly

00:05:46.400 retreats, my company continues to grow. My team continues to show up. And it doesn't require

00:05:51.820 like stock options and all these incentives

00:05:53.940 that a lot of you guys have been hearing about in the Valley.

00:05:55.740 It just requires you to show up differently as a leader.

00:05:58.740 And that's the meat of it.

00:06:00.460 So I want to share with you guys three big ideas.

00:06:02.620 But before I get into that, I want to talk about the pain line.

00:06:05.580 So in the growth phase of any company,

00:06:10.520 entrepreneurs will eventually hit what's called the pain line.

00:06:13.380 And here's what I've learned about entrepreneurs.

00:06:15.540 They will not grow into pain.

00:06:17.640 If there is a knife to your throat and walking forward

00:06:21.380 means you're going to get stabbed in the neck. You will not walk forward. Usually in these moments,

00:06:25.200 I get the call because people want to do one of three things. I call them the three S's.

00:06:28.420 They either want to stall. You know, I made more money last year with less headaches. Anybody

00:06:33.280 resonate with that message? We've all been there, right? Where we grew a lot and we made less money

00:06:37.780 and it was a lot more headaches. My buddy, Matt, had an electrical company. He's like, hey, Dan,

00:06:42.600 is it okay if I don't want to grow? Can I just like be the same size? And I'm like, yeah, you can,

00:06:47.540 but here's what I know. The market's not going to slow down. It grows every year. It's called GDP.

00:06:52.880 Your customers aren't going to require less of you. They're going to expect more. So eventually

00:06:57.120 your best customers are going to leave. And then the third is your best team members are going to

00:07:01.840 leave because they have a vision for their life that if you can't fulfill, they'll find that person

00:07:06.000 to fulfill it. Right? Because our goal as leaders, you might want to write this one down, is to have

00:07:10.640 a vision big enough for every person on our team's goals and dreams to fit within it. If your vision

00:07:16.400 for your business isn't big enough for everybody on your team's goals and dreams to fit within it,

00:07:20.160 you're going to lose your best people. The second S is sabotage. And this one is a funny one.

00:07:26.080 So I'm going to give you a few examples. My buddy Trevor did this recently, and he essentially had

00:07:31.100 an opportunity to 3X his business in a month through a new partnership. And instead of replying

00:07:35.980 right away to the opportunity, he sat on it. And he opened the email, and he closed the email,

00:07:41.260 and he opened the email and he closed the email. He never replied. 11 days later, he goes to the

00:07:47.360 gym on a Saturday. He's feeling good about himself. He ate really clean the day before. He's got the

00:07:51.460 confidence up. So he finally replies that I'd email. And the person's response was, hey man,

00:07:56.800 like appreciate you replying, but that opportunity's already left. He sabotaged himself from growing.

00:08:03.060 Some of you don't realize that you've hit the pain line and because growth means more pain,

00:08:10.120 you sabotage your success. And it can show up as simple as not making a key higher out of fear.

00:08:15.620 It could show up essentially anytime your calendar will be compromised. If growth means your calendar

00:08:21.140 will turn into chaos, then you won't grow. And then the third S is sell. My buddy Jason called

00:08:27.260 me probably six months ago because his business wasn't doing well. He wanted to exit. And I asked

00:08:31.420 him, list me the three things that are not going good in the business. He's like, one, two, and

00:08:35.460 three. I said, cool. If those three things weren't an issue, would you sell the business? He's like,

00:08:39.420 no. I go, well, here's the thing, man. Every entrepreneur will hit their complexity ceiling

00:08:45.580 and you either decide to deal with that complexity ceiling today or you can go to the next business,

00:08:50.980 the next green pasture, the next, you know, we always think the other idea, the other market's

00:08:55.200 better. You will hit that same complexity ceiling and it's going to stop you. So either start today

00:09:00.360 or deal with it later. So what I want to share with you guys is the buyback principle, which is

00:09:05.000 we don't hire to grow our business. We hire to buy back our time. Because if you do the second,

00:09:11.080 you get the first. But if you do the first, you won't get the second. Does everybody get this?

00:09:16.340 Yes or yes? Perfect. Buy back principle. This is the philosophy. So here's what I learned a long

00:09:22.660 time ago. $10 million companies, startups were not built off $10 tasks. Mathematically impossible.

00:09:28.820 It's a physics thing. You don't have enough hours in a week. You can't build a 10 million

00:09:32.860 company doing $10 tasks. What I'm going to share with you today specifically about scaling is the

00:09:38.380 leadership side because I feel like that is the biggest opportunity for all of you is how to show

00:09:44.200 up for your team in a way that can scale you and you don't become the complexity ceiling for your

00:09:49.240 business. So three mistakes I see entrepreneurs make all the time. Number one is holding on too

00:09:54.620 long. How many of you guys start to feel really warm on your chest or kind of like get super

00:10:00.060 anxious if I tell you about delegating to other people. You guys a little nervous, right? The

00:10:05.080 reason why is because a lot of us have a fear of losing control, okay? My son's like that. He has

00:10:11.640 Legos and he considers himself a master builder, but he does not like letting anybody else help

00:10:17.800 him because what if they do it wrong? And then he's got to fix it. Many entrepreneurs deal with

00:10:23.180 this. They hold on for too long and write this one down. Your number one strength becomes your

00:10:28.860 Achilles heel as you grow. So that's a crazy one for you to wrestle with. The thing you're great

00:10:34.840 at as you grow to 10 million will be the number one Achilles heel in stopping you from growing

00:10:40.500 because it's the thing you're going to judge the most, you'll be the most critical of, and it's the

00:10:44.260 last thing you'll give up and you'll be the bottleneck for your team. So I want to share with

00:10:48.860 you the big lesson I learned from Richard Branson, which was it's not even just about buying back

00:10:55.120 our time, it's about protecting our time, okay? The opportunity for you to transform your team

00:11:01.700 and the way you show up as a leader is through protecting your time. So, I had the fortune. I

00:11:07.840 grew up in a small town in eastern Canada, okay? Like, I read Richard's books, and if you don't

00:11:12.300 know who Richard Branson is, he's technically the billionaire every other billionaire wants to be

00:11:15.780 Like literally, exactly. So when I get the email in 2017 asking me if I want to spend a week with Richard Branson, I was like, okay, what's the date? Is this April 1st? This makes no sense to my brain.

00:11:30.780 And the reason why is I was working on this company called Clarity, and Richard was an investor in my friend Dan's company, Zosie, and he said, hey, Dan, I'm going to Switzerland for a ski week. You should invite some friends.

00:11:43.820 I'd love to meet some of the people in the valley doing cool stuff.

00:11:46.620 Whatever reason, he thought what I was doing was interesting.

00:11:49.180 So I get to go spend a week at Richard Branson's.

00:11:52.100 Tim Ferriss is there.

00:11:53.600 Brian, who just sold his company, Braintree, for, I think, $650 million there.

00:11:58.220 There's literally, it's like imposter syndrome on my part, out the wazoo.

00:12:02.840 Like, I'm thinking somebody's going to discover quickly I'm not supposed to be there,

00:12:06.940 and I'm going to get pulled out of this house and brought back to, you know, back home.

00:12:11.780 And here's the thing that resonated the most with me, was watching how Richard spent his time.

00:12:19.660 It was fascinating.

00:12:21.160 And I think this is the opportunity for everybody in this room to understand is, here's a guy that runs 400 companies.

00:12:29.000 Technically, he owns 400 companies.

00:12:30.660 The Virgin Group of Companies is like this big conglomerate.

00:12:32.980 Each one has CEOs, and he has two CEOs that runs the Virgin Group.

00:12:36.160 It's amazing.

00:12:37.640 And he's skiing all day with us.

00:12:39.440 He's coming out with us for Apres Ski.

00:12:42.940 And I was obviously really excited to finally get to meet him and talk to him,

00:12:47.260 and we had dinner every night, and it was amazing.

00:12:48.840 But the thing that impressed me the most was how he protected his time.

00:12:53.800 And the way he did that is every message coming into his life

00:12:58.120 went through a person named Helen.

00:13:01.100 And Helen was his executive assistant.

00:13:03.740 And when you hear things like he doesn't do email

00:13:06.540 and he doesn't have a laptop or a smartphone,

00:13:08.620 own, it's true. He might today, but at the time, literally every demand on his time went through

00:13:14.300 Helen. And the way he processed it was, they would have breakfast, and for 90 minutes, she would bring

00:13:20.800 to him only the things she didn't know how to handle, and they would talk about it. And I remember

00:13:26.520 talking to Helen on the third day, and I was like, tell me about your relationship with Richard, if

00:13:30.140 you don't mind. Like, how does it work? And she walks me through this process, and I go, that's

00:13:35.220 completely different than the way I'm working right now. And what I believe is where you're at

00:13:40.580 today, if you want to get to 10 million, you're at a million, it requires a completely different

00:13:44.860 paradigm shift in how you think about your time. When I was younger, I had all the time in the

00:13:48.540 world. So guess what? I didn't value it. What I've discovered is when people get into their 40s

00:13:54.140 and 50s, all of a sudden, it becomes really valuable, and they start looking at these

00:13:57.760 opportunities to buy it back. And I learned that from Richard. He literally said, I do these

00:14:02.280 things better than most people in the world, and I love doing this. Everything else has to go

00:14:06.160 through Helen, and she knows what I prefer. So I want to teach you the framework called the

00:14:11.440 replacement ladder, okay? So if I was starting today from scratch, this is the sequence. If you

00:14:17.380 don't have something to write down, take photos, but I'm going to go through it, and you're going

00:14:20.660 to want to remember this stuff. The first level of replacement is your admin. This is somebody

00:14:26.720 that can do all the administrative stuff in your life. And specifically, I talk about inbox and

00:14:33.120 calendar. Again, if you're building a $10 million a year company, but you're doing $10 tasks, the

00:14:38.580 math doesn't work out. So even from day one, which will be counterintuitive to what you've heard from

00:14:43.300 everybody else, I will actually encourage you, and my portfolio companies, that's what I do,

00:14:47.480 is to hire an executive assistant and have them manage your email in your calendar. My brother

00:14:52.760 hired an assistant, and I was asking him how it was going. He's like, well, I don't understand

00:14:56.280 the big ideas. And I'm like, dude, it's like transformational. He's like, yeah, I'm not

00:15:00.540 really getting a lot of value. And when I asked him if he delegated his inbox to his assistant,

00:15:06.100 he said, no. What I do is I just send her stuff or him and CC them on task. And I was like, no,

00:15:12.480 dude, all the stuff that's coming into your world needs to be processed by somebody else.

00:15:16.620 And then you guys talk about what they don't know how to handle. So level one is an admin. Level two

00:15:21.600 is customer success. If you're not there, you're going to feel stalled. And the key roles that

00:15:26.120 have to take over is all onboarding and all support. Okay? So far, so good. Yes or yes?

00:15:31.940 Perfect. Level three is marketing. Okay? Because if you're still the one dependent on generating

00:15:37.760 leads, then as soon as you go on vacation or get busy with a new hire or go on a fundraising

00:15:43.460 process, your business slows down. It's a dangerous place. But the key is they got to own the traffic

00:15:48.480 In the campaigns. They got to own the creativity and

00:15:50.480 Make sure the traffic is coming through.

00:15:52.480 The fourth level is sales. And this is freedom.

00:15:55.480 And the reason why it's freedom is because of this.

00:15:58.480 These are only four hires in your business.

00:16:00.480 You now can sleep and have somebody generate leads, talk

00:16:03.480 To those opportunities, close them as a customer, and somebody

00:16:06.480 Can onboard them and bring them into your software.

00:16:09.480 Okay? Four hires and you're now at a level of freedom.

00:16:12.480 And the favorite one is leadership, which is the top

00:16:15.480 This is where you have to hire people that lead, but you've got to ask them to own strategy and outcomes.

00:16:23.480 And we'll talk about this in a bit. But if you hire somebody and tell them what to do, you're doing it wrong.

00:16:30.480 So this is the first mistake I see founders make.

00:16:34.480 It's that they hold on for too long and they don't know how to replace themselves.

00:16:38.480 This is the model to follow. Here's the deal.

00:16:43.480 And guess what?

00:16:46.480 You suck at it and you're overpaid.

00:16:49.480 Let's be honest.

00:16:51.480 You're not good at it and you're making way too much money.

00:16:54.480 Okay?

00:16:55.480 So find a partner that can support you.

00:16:57.480 Second mistake, heads not hands.

00:16:59.480 A lot of you are in software, so you guys think to yourself,

00:17:02.480 I just need to automate this.

00:17:04.480 I need to outsource this to another part of the world.

00:17:07.480 I need to have just a bunch of hands doing stuff,

00:17:10.480 doing stuff, following SOPs and automations. What you need to do is understand how to get

00:17:15.680 leverage with your people. That's why I call it heads, not hands. Too often I meet founders and

00:17:20.420 they're like, oh yeah, I got 26 people in the Philippines. It's like, yeah, but are they just

00:17:24.080 following scripts blindly? Are you actually hiring people, training them and having them come up with

00:17:28.420 solutions to problems? So I learned this moving to San Francisco. When I was 28 after I sold my

00:17:33.780 first company. I moved there, and within a few months, I meet Naval at this entrepreneurial

00:17:40.220 dinner. And Naval Ravikant is arguably like our modern-day philosopher in startup world, right?

00:17:46.840 How many of you guys know who Naval is? Naval Ravikant? Perfect. So I met Naval, I think,

00:17:51.220 even before AngelList was a thing. And it was literally after going through so much pain in my

00:17:57.160 previous company and asking myself, well, how do I create in the world but still do it in a way

00:18:03.440 that doesn't sacrifice my relationships,

00:18:07.780 I didn't have an answer to that question,

00:18:09.740 but I wanted to figure it out.

00:18:11.320 And I meet Naval, and Naval shared with me

00:18:13.080 this really, really important framework, okay?

00:18:16.060 And if you write this down,

00:18:17.480 you will now have the four master skills of an entrepreneur.

00:18:21.080 There's only four ways to get leverage,

00:18:23.600 and leverage is everything, right?

00:18:25.140 Because if you want to increase your output,

00:18:27.240 time is a constant, the leverage is a variable,

00:18:30.860 a multiplication of leverage,

00:18:32.420 and then the output is, you know,

00:18:34.540 dependent on how well you have leverage.

00:18:36.540 And there's only four ways to create leverage.

00:18:39.000 The first one is capital.

00:18:40.720 A lot of us know this.

00:18:41.660 We're in the software world.

00:18:43.100 Raise capital to hire people to generate revenue

00:18:45.900 that's more efficient, right?

00:18:47.180 And then we return the capital and we keep the balance.

00:18:49.500 The second one is content, okay?

00:18:52.040 That's why James said, you know,

00:18:53.240 Dan's the guy, he's sharing content.

00:18:54.880 I realized a long time ago

00:18:56.340 when I was building standard operating procedures

00:18:58.600 or playbooks for my businesses, that's content.

00:19:00.800 content has incredible leverage, right? Creating videos, media, all this stuff, incredible leverage.

00:19:08.100 If I record a podcast, it doesn't cost me anything more to have 10 million people listen to it than

00:19:13.540 the first 10. Does that make sense? Huge leverage. The third, which is like hot and heavy right now

00:19:19.000 in the market, is code, right? Think about automation software. It's what all you guys do

00:19:24.000 if you're in B2B SaaS. And then AI. AI is one of the coolest. If you haven't been playing with GPT-4,

00:19:30.140 it's blowing my mind what it can do, right? So the third area is finding leverage with code.

00:19:35.840 The fourth one and what I want to talk about today is collaboration. Okay, those are the four Cs.

00:19:40.760 Capital, content, code, collaboration. And when he explained to me collaboration, I was like,

00:19:47.600 I'm thinking about it completely wrong. Because if I keep telling people what they have to do,

00:19:51.880 then I'm not getting any leverage. Does everybody get that? Like, truly listen to that. If you have

00:19:57.260 to tell people what to do, then you're not getting any leverage. So Naval shares this with me, and I

00:20:03.020 take it to another level, and I built this framework called transformational leadership, okay? This is

00:20:07.960 the solution to the second biggest problem. Transformational leadership is completely

00:20:12.920 different than what I was taught or taught myself when I started in business, which is

00:20:17.280 transactional management. Transactional management is you tell them what to do, you tell them what to

00:20:22.840 do next, and then you check that it got done, and then you tell them what to do next, okay?

00:20:28.820 Which sounds like what I did for the first three companies. Literally, I showed up, I told people

00:20:34.120 what to do, I checked they got it done, and then I told them what to do next. The challenge with

00:20:38.100 that is that as you add people, there's this natural bottleneck of being able to do that.

00:20:43.240 It usually is about 11 to 12 people, about a million and a half in ARR, where you just can't

00:20:48.760 manage. Has anybody ever woken up in the morning with, like, a project list, and then you get in

00:20:53.060 your inbox, and then you get phone calls, then you get text messages, and then by, like, four o'clock

00:20:57.720 in the afternoon, and you put out all the fires, and you told people what to do, and you checked

00:21:00.720 that they got it done, you told them what to do next, that you finally, at five, six, seven o'clock

00:21:04.300 at night, get a chance to do the work you were supposed to do? Does that sound familiar to

00:21:07.560 anybody? Yeah, I'm not going to call you out, but that's because you're doing transactional

00:21:11.540 leadership or management. What you want to do is do transformational leadership, which is you start

00:21:17.340 with the outcome. If I was trying to climb a mountain, I would be clear as day on what we're

00:21:23.940 trying to accomplish. We'll get to the top of this mountain. When we get there, it's going to look

00:21:27.000 like this. You're going to have these resources. Here's how it's going to feel. Think of it this

00:21:31.120 way. If you're asking somebody to revamp your website, tell them the success criteria that

00:21:37.040 you're going to use to evaluate if they did a good job. Outcomes. Then you give them the measurement

00:21:43.860 that you're going to use to measure their progress.

00:21:46.340 If we're climbing a mountain, I'm going to say,

00:21:48.060 hey, the core metric we're going to measure

00:21:49.640 is feet of elevation per day.

00:21:52.640 If I know how many feet of elevation per day

00:21:54.880 you've been doing every day and you just text me,

00:21:56.640 then I can do the third part, which is coach to success.

00:22:00.860 Because maybe day one, you got 1,000 feet of elevation.

00:22:03.820 And then the second day, you only got 50.

00:22:05.520 And I'm going to check in with you.

00:22:06.520 Hey, dude, what happened?

00:22:07.660 And you're going to be like, yeah, I got lost.

00:22:09.740 Then I'd say, well, what are ways to avoid getting lost?

00:22:12.980 And then the person hopefully will reply and say, well, it'd be good if I had a mat.

00:22:16.980 I go, well, where would you get a mat?

00:22:18.920 He's like, well, there's these other hikers.

00:22:20.580 Maybe I could ask them.

00:22:21.840 Sounds like a good idea.

00:22:22.940 Try that.

00:22:24.080 See what I'm saying?

00:22:25.240 That's what coaching to success looks like.

00:22:27.760 And then you just keep measuring.

00:22:29.220 You set the outcome.

00:22:30.460 Here's why this strategy is so powerful.

00:22:32.620 If you get this, it will change the game on your rise to $10 million in ARR.

00:22:37.260 essentially over time you build people to a point where they no longer have to come to you for the

00:22:44.040 answers because you're building a pattern where they they learn how to self-lead does that make

00:22:49.320 sense that's why it's transformational leadership they'll eventually get to a point where they will

00:22:54.320 start with the outcomes they will define the measurement for success and then they will come

00:22:59.880 to you only when they need coaching but for the most part they're going to self-coach themselves

00:23:03.400 or find the resources online.

00:23:05.980 And this is how you remove yourself

00:23:07.900 from having to be the person.

00:23:10.740 And the day you remove yourself

00:23:12.060 from having to be the person

00:23:13.060 is the day your business will grow.

00:23:14.600 It's the law of the lid in full effect.

00:23:17.280 So here's the big idea.

00:23:20.120 Delegate the outcome, not the task.

00:23:22.740 Okay, delegate the outcome, not the task.

00:23:25.780 And really ask yourself

00:23:27.180 when you're writing that email reply,

00:23:28.840 you're getting on that Zoom call

00:23:30.120 and you're about to say something,

00:23:31.280 is go, am I about to tell somebody what to do or am I talking about the outcome? And watch your

00:23:38.260 team elevate through this process. It's a beautiful thing. It's why I love the work I get to do so

00:23:42.980 much is because I know helping the CEOs in this room is going to allow you to show up for your

00:23:47.720 team in a way that's going to transform your culture. It's going to transform your people

00:23:51.440 and it's going to build them to become the people that I'm sure you saw in them when they started

00:23:55.440 with you, but maybe after a few months they start to frustrate you. Those people where you're like,

00:24:00.560 I saw potential, but why has he pissed me off so much?

00:24:03.360 It's because of the way you're showing up.

00:24:05.920 The third big mistake is the genius bottleneck.

00:24:10.620 The genius bottleneck.

00:24:14.200 Most entrepreneurs run around the world as the genius with 1,000 helpers.

00:24:20.300 And the problem is that you're never going to build the people around you.

00:24:24.420 If you look at the most successful people, the Richard Branson, the Mark Cuban,

00:24:27.260 you name it, Naval Ravikant.

00:24:30.560 And you look at their leadership team, you look at Bezos, each one of his direct reports, CEOs of

00:24:37.680 his divisions, or whatever you want to call it, they're world-class leaders. And the reason why

00:24:42.540 is because Bezos got rid of being the bottleneck, okay? And this is the strategy to do it. Adam used

00:24:50.360 to work for me in HR, and one day he comes to me and he's like, hey man, I'm stressed. And I go,

00:24:56.460 what about? He goes, well, we got to hire 12 people in the next quarter. And I go, cool.

00:25:03.040 He goes, I don't know how to do that. And I go, okay. Well, what should I do? I don't know.

00:25:11.940 Well, I mean, there's a problem. What's the problem? I need to hire 12 people in the next

00:25:16.360 quarter. Sounds like you have a problem. He's like, yeah. I go, so, like, I love you, man,

00:25:24.180 but are you asking me to do your job because I think you're the HR director?

00:25:29.460 Well, I'm not asking you to do my job.

00:25:31.180 I say, well, it sure sounds like it.

00:25:33.220 If I have to tell you the answer to the test, it sounds like I'm taking the test.

00:25:37.240 Yes or yes?

00:25:38.720 Perfect.

00:25:39.580 Stop telling the people the answer to the test.

00:25:41.960 So instead, I taught Adam this simple rule.

00:25:45.080 It's called the 131 rule.

00:25:46.480 I learned it from my buddy Brad a long time ago, and it's transformed the way I show up.

00:25:52.120 Okay?

00:25:52.620 I shared it with Adam.

00:25:54.180 And I say, you know, here's the way it works.

00:25:56.620 Come back to me tomorrow.

00:25:57.980 In the morning, he texts me and he just says, I'm good.

00:26:01.000 He didn't need to talk to me.

00:26:02.100 Here's how it works, okay?

00:26:03.700 The one, three, wrong rule follows these three principles.

00:26:06.760 First off is you have to come to me with one problem.

00:26:10.820 The amount of times people come to me with this, like, very broad thing that's not specific, it blows my mind.

00:26:19.060 Defining a problem, a well-defined problem, is the first challenge.

00:26:22.980 So step one, one specific problem.

00:26:25.900 Number two is three viable options.

00:26:29.120 Tell me what are your three options of solving this problem.

00:26:31.800 But viable ones, not like baloney ones that make no sense.

00:26:34.340 Like, one of our options is to do nothing.

00:26:36.440 Well, yeah, duh.

00:26:37.580 Like, I could do that job.

00:26:39.480 That's not a hard one.

00:26:40.240 But, like, come to me with three viable options.

00:26:43.240 So I share this with them.

00:26:45.180 And then number three is, what's your one recommendation?

00:26:47.780 now here's what happened is i share this with adam and he and i go how much time do you need

00:26:54.380 to put together some options he says how about till tomorrow i said perfect let's talk same time

00:26:57.940 tomorrow circle back by the morning when he did the research it was obvious to him what he needed

00:27:04.720 to do he didn't even need to talk to me ever again here's why the 131 rule is a game changer for the

00:27:11.040 genius bottleneck, is that when you implement this into your team, over time, you get to push

00:27:18.200 all problems down to the frontline workers who have the most context to solve your problem in

00:27:23.100 the first place. Some of you are solving problems with imperfect information, but the team has it.

00:27:29.100 The context is down at the frontline individual contributor level. And anytime somebody comes to

00:27:35.980 you with a problem and you say, what's your 131? That's the language. You literally, if you're on

00:27:40.240 my team, I will say that to you very often. They go, oh, this is a problem. What's your 131? Well,

00:27:44.620 I don't know yet. Perfect. How long do you need to research it? All right, I get it. Cool. And see,

00:27:50.380 it's not because I don't want to do work. It's just my happy place is arguing around the sequencing

00:27:55.420 and the ideation, right? And that's what you love to do as a CEO. You don't want to actually tell

00:28:00.100 people what to do. You want to know that they did the research to come up with options and then help

00:28:04.280 them craft it and change it and tweak it and then say, what's your recommendation? And they go,

00:28:09.280 this one. You go, totally agree. Let's do that. That is how you build a company that is not

00:28:15.540 dependent on the CEO, and it can scale. And it is one of the most beautiful things to watch.

00:28:20.740 Here's my philosophy, is we build the people, and the people build the business.

00:28:26.260 You want to go from $2 to $10 million, $3 to $10 million in ARR? I'm telling you, it's a very

00:28:30.720 simple recipe. Look at your team and invest in them the same way you invest in your marketing.

00:28:37.340 If you invest in your people to a similar degree as you do in your marketing and your sales, you will build a team that can execute that vision.

00:28:47.100 If you keep investing in every other area of your business, right, customer success and marketing, all that stuff, but you don't invest in your people personally with your time, if you don't pour into your people, then you're not going to build the people that can build the business and you'll always be the bottleneck.

00:29:01.360 So those are the three big ideas, right?

00:29:03.460 Number one is, what's the sequence of replacing yourself out of your business so you can get to 10 million?

00:29:08.960 The second one is, how do I show up as a transformational leader so that I can inspire and grow and develop my people,

00:29:16.080 but do it in a way that supports them so I'm not telling them what to do?

00:29:20.060 And the third, how do I give them a tool where they as a leader can now push down to their direct reports

00:29:26.180 so that they don't become a bottleneck for their own team?

00:29:29.240 Because they're going to do what you're doing.

00:29:30.860 And if you show up as somebody that tells people what to do, they're going to do the same thing, and the whole thing gets bottlenecked.

00:29:36.860 Does that make sense?

00:29:37.560 Yes or yes?

00:29:38.880 Cool.

00:29:39.680 The one question I get every time I share anything about the replacement ladder is, Dan, how do I hire an assistant?

00:29:45.920 Anybody thinking that right now?

00:29:47.300 Or what do I get them to do?

00:29:48.560 Or what's your SOPs?

00:29:49.860 Well, here's the deal.

00:29:50.600 I'll give it all to you.

00:29:51.400 I literally put together my job posting for my assistant, the test projects that we use for my assistant, and the SOPs, my personal SOPs.

00:30:03.160 I had her sanitize it, put it together only for this room.

00:30:06.080 So if you want to get that, just go to the URL, download that copy for yourself.

00:30:10.520 And afterwards, I'm going to be doing a book signing.

00:30:13.040 This is my new book called Buy Back Your Time.

00:30:14.780 If you like some of the content I just shared, I'd encourage you to go check it out.

00:30:17.980 The audio book is read by me with bonus content.

00:30:21.720 And I just want to share this.

00:30:23.360 I believe every one of you guys are here, here in the world, to do two things.

00:30:28.440 Number one, become the best version of yourself.

00:30:32.440 Wake up every day and grow and develop and just be the best version of yourself.

00:30:38.080 And two, share that person with the world, to your community, to your family, to the people on the Internet.

00:30:43.940 I don't care who you share it with.

00:30:45.280 I really encourage you guys all to keep going on your journey of growth and sharing those lessons with people around you.

00:30:50.400 Thanks for having me.

Dan Martell - October 02, 2023

I made $10M to Prove It’s Not About Luck

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