REAL AF with Andy Frisella - How to Manage Cash Flow, with Andy Frisella - MFCEO143

00:00:00.000 What is up guys you're listening to the MFCEO project I'm Andy I'm your host and I am the

00:00:11.120 motherfucking CEO guys this is your first time joining us welcome this is an entrepreneur podcast

00:00:18.260 it's gonna be mixed in with all different kinds of things lifestyle motivation inspiration tips

00:00:26.500 and tricks on how to think everything that you hear on this podcast is gonna be practical to your

00:00:32.700 growth some days we're gonna talk more about you know actual specific tasks that you need to do

00:00:39.760 as an entrepreneur some days we're gonna talk about mindset sometimes we're gonna talk about

00:00:44.360 you know how you should react in certain situations but all of it is going to contribute to your

00:00:50.700 personal development whether you are an actual business owner or whether you're somebody who

00:00:55.300 works within the structure of somebody else's business thinking like an entrepreneur is how

00:01:00.660 you become successful these days so with that being said I'd like to welcome my co-host Vaughn the pastor

00:01:08.700 of disaster what's up my man I'm good man but uh I you know I've always wondered what response I

00:01:15.440 could give you in these opening lines that would actually make you laugh or completely you know

00:01:20.320 shock you yeah so what would that be well if I have to tell you it's not gonna make me laugh

00:01:25.240 because I want to know what it is but I mean like if if you know you said what's up and I said

00:01:30.680 something like well I was gonna cuss but I'm not going to but you know if I said like funny in its

00:01:36.900 own right I know it is a little funny I just can't think of anything that I do that would shock you

00:01:40.940 I don't get shocked yeah you know what I'm saying like and I don't even in conversations with people

00:01:46.520 that I don't think you could like I'm not somebody who gets surprised like that like I just sort of roll

00:01:51.720 with it maybe if I if I responded and I was like yeah bud or something like that that one might

00:01:57.160 it might I don't know it might you might need to work on that a little bit yeah especially since

00:02:02.260 I said bud not boy yeah yeah so what's up with you you got the cough drops out you got uh what are

00:02:07.840 you sick um yeah I'm a mess where you you you remind me of one of those kids that was probably

00:02:12.160 allergic to a lot of shit bubble boy yeah bubble boy uh no it's just that time of year yeah that 0.58

00:02:18.020 time of the month yeah exactly yeah I knew I walked right into that one yeah you did so yeah

00:02:22.040 no but uh I have so what are we gonna talk about today because we don't have like a specific set

00:02:28.220 outline we're gonna talk about cash cash straight cash homey cash straight cash millionaire homey

00:02:34.800 that's right yeah see you like that I do like that that was a pretty good rap I do like reference

00:02:38.960 so so I think that's a good thing to talk about because I feel like the and I know this for sure

00:02:46.940 that the biggest reason that most small businesses ruin themselves is because they fuck up their cash

00:02:53.480 flow they don't understand how to manage cash flow because you know like it or not when we grow up in

00:02:59.500 school and we go to business school and they try to teach us about business they never fucking teach 0.91

00:03:04.960 us how to manage cash flow they talk about it in these big crazy un uh you know comprehensible terms

00:03:11.700 that nobody knows what the fuck they're talking about and it you know people go out and they start 0.80

00:03:16.900 a business and then they have no idea what's coming down the road and they end up running out of money

00:03:21.100 not because they don't have money but because they allocated on the wrong things so I thought that

00:03:26.100 you know us kind of addressing some of these things and telling you guys some of the stories that that

00:03:32.740 we've screwed up on might help some of these guys who are just starting out because managing cash flow

00:03:37.840 guys is the lifeblood of your business you know you're gonna have to understand that it's not

00:03:45.380 this thing where you go out and sell product and then you've got 10 million dollars in the bank

00:03:49.000 tomorrow it's you've it's like a river man you've got to learn how to like guide the river into the

00:03:54.640 into the power generation dam that you want it to go into and that shit takes skill and it takes 0.61

00:04:01.460 experience and unfortunately most business schools don't teach us how to manage it in a practical way

00:04:07.040 so I think you know this could be a very helpful podcast for some of the guys who are just getting

00:04:13.160 going or just starting out or within the first couple years you know it took me probably it probably

00:04:18.320 took me and Chris 10 or 11 years to figure out how to manage cash flow to where it's responsible

00:04:23.840 and apparently this is the number one problem for new entrepreneurs and new startups because uh

00:04:31.100 statistically like a survey it's the killer of most businesses right so if you if you do struggle with it

00:04:36.600 and you're listening I mean you're not alone no everybody does a lot of people right and you know

00:04:43.280 you see these companies who even big giant companies have problems with this because it's

00:04:48.460 always changing and the amount of cash coming in is always changing and you have to learn to see

00:04:53.340 the 10,000 foot view of what's going on within your company so that you can make adjustments as you

00:05:00.380 go to where the cash flow will still allow your company to operate um you know Mark Cuban has a

00:05:07.340 saying that he says all the time that I agree with 100 percent uh you know sales cure all and they

00:05:12.380 fucking do all right so let's just start with that too many people out there right now and too many of

00:05:19.260 you guys listening and too many of the new quote-unquote internet entrepreneur mindset they think they're

00:05:26.280 going to come up with a product or a service or something that sort of like tricks people into

00:05:32.380 buying it and it's not something that really truly honestly solves a problem if this is your product if

00:05:40.700 you look at your product and you think well it sort of solves a problem but you know not really and

00:05:45.200 you think you're going to make up the rest by like some fancy marketing scheme you're going to

00:05:49.360 fucking lose okay that's step number one your product your service your business whatever concept 0.92

00:05:54.900 if you if it does not solve a legitimate problem for people that is going to that's going to solve

00:06:01.640 the problem in such a way that they're going to talk about it with their friends you've got the wrong

00:06:05.960 business model because I can tell you from experience you have to have something that's going to be

00:06:14.440 organically shared for your company to scale and that means people are going to have to say oh wow I

00:06:19.900 really like this product it solves this problem perfectly and go out and tell their friends I

00:06:26.680 mean let's look at something as simple as the fucking snuggie all right the snuggie is probably 0.85

00:06:31.760 the dumbest looking fucking thing on the face of the earth all right but what did it do it solved a 0.94

00:06:37.200 fucking problem a simple problem when you got a blanket on you can't use your fucking arms so they 0.97

00:06:42.460 made a they took a robe and they turned it backwards and they made they called it a blanket with arms

00:06:47.180 and they made fucking hundreds of millions of dollars so I'm not saying your product has to

00:06:52.500 solve fucking world peace but it's got to solve a legitimate problem and a clear problem and if it

00:06:59.740 doesn't and you think you're going to make up with it with some creative marketing you're going to lose

00:07:03.000 that's just a fact of the matter so before we even get into cash flow if you're in the early stages

00:07:08.860 of your business and you're one of these people who's looking at their product and they they secretly

00:07:14.020 know like it's not what it should be then don't fucking do it because you're going to get your 0.98

00:07:18.620 ass beat just a matter of that's that's the foundation yeah it has to it has to be there so

00:07:24.420 um so let's say you do have a product that solves a problem and and you have cash coming in and you're

00:07:32.420 trying to grow and scale a company and that could be very overwhelming and very confusing to somebody

00:07:38.480 who's never done it especially someone who doesn't have someone that they can rely on to help coach

00:07:43.840 them so my number one recommendation would be find someone that you could talk to on a regular basis

00:07:48.720 that can help direct you like a mentor on how to scale your business properly and help prioritize

00:07:53.660 where you need to be spending the money because the first thing people do when they get a little bit

00:07:57.920 of money coming in is they like to take it because there's a saying out there that says pay yourself

00:08:02.620 first all right and i one thousand percent disagree with that statement i don't even know why it's out

00:08:09.580 there because if you're the pay yourself first guy then you're going to end up owning your employees

00:08:15.240 you're going to own your vendors you're going to own all the people that you need to pay and eventually

00:08:20.020 your business is going to end so you're gonna have to realize that paying yourself last is the reality

00:08:25.200 of entrepreneurship it just is pay yourself a decent livable wage bonus yourself out at the end

00:08:31.740 whatever you know whatever's left and that's it um so i've got a number of steps here that i'd like

00:08:39.020 to go through and one of them is number one is you know people always hear that there's always that

00:08:47.860 saying right it takes money to make money so they spend their money on things that they don't really

00:08:52.920 need to spend it on because they think they need to be playing business all right um you see this a lot

00:08:59.520 with like younger entrepreneurs like they'll go out they get a little bit of cash flow coming in and

00:09:03.780 they go spend it on like office furniture because they want their name on the fucking door um or they 0.95

00:09:08.240 go spend it on you know a new office space or a new this or a new that or a new forklift because they

00:09:15.660 want like the new shiny forklift to run through their warehouse whenever the people come see it like

00:09:21.200 they become proud about shit that doesn't really even matter when it comes to running a business

00:09:26.140 and you have to realize how to prioritize those things okay your job is to make a company your job

00:09:32.940 is to sell shit your job is to reinvest the money that you make from selling the shit until you get 0.63

00:09:37.420 the company to a place where you want it to be now i call this playing business all right playing

00:09:43.580 business is you know going out starting an llc getting business cards putting your name and a nice

00:09:50.820 shiny plaque on the office you know and like people who have never been in business they think this shit 0.76

00:09:55.480 really matters and it doesn't you know they want they want to walk in they want to see their fucking 0.98

00:09:59.180 name on the desk they want to see their their nice little arrangement of pens you know they want to

00:10:03.800 have their special pen that they sign documents with their mont blanc you know what i'm saying and

00:10:08.580 they want to fucking act like they're some sort of business dude and that's called playing business

00:10:12.540 and people who play business never fucking win all right i've never seen one the guys i know that do 0.91

00:10:17.520 well the guys i know that succeed the guys i know who are out there making millions and millions and

00:10:21.740 millions and millions of dollars don't give a fuck about any of that they're focused on one thing

00:10:26.220 and one thing only and that's how do i fucking solve a problem okay so quit spending your money on 0.98

00:10:30.540 dumb shit doesn't matter what do you what do you think about the guy that says well perception is 0.87

00:10:35.140 reality andy so i have to you know i have to put it on a good you know presentation i have to be

00:10:40.300 in the minds of people really well put together so that okay there's certain businesses where that's

00:10:45.520 required all right like if you're in a financial uh you know some sort of financial business and you

00:10:52.780 need to meet people and there's traditional uh business practices that are that are the standard

00:10:58.580 of how business is done um i think that was relevant phrase earlier in time more relevant yes yeah like

00:11:07.220 dude the guys i know like right now like the guys i know lending big money and borrowing big money

00:11:12.040 they're doing it over fucking barbecue you know i'm saying it's not in a bank office days where 0.93

00:11:16.300 you walk around with fucking business cards in your pocket that shit yeah it's it's it's becoming 0.93

00:11:21.300 outdated like people care more and more and more about what you're really doing and so like

00:11:25.320 while i agree that perception is reality in certain things it's becoming less and less relevant of a

00:11:31.320 concept and people get so caught up in the perception of reality is uh that they that they spend all

00:11:37.000 their money on the perception none of it on the reality you know and they end up in a situation

00:11:41.200 where they can't they can't run their business so um i think everybody listening knows what i'm

00:11:45.660 getting at you know with these points just be scrutinize where the fuck you're putting your 0.91

00:11:49.660 your money uh when it comes to like operating your business put it put it into inventory put it into

00:11:55.220 your product put it into improving the product put it into fucking sales people that go out sell the 0.98

00:11:59.560 product you know do it into things that are going to generate revenue not things that are going to

00:12:03.240 create a perception of revenue so that's point number one that that sounds like the number one

00:12:08.300 criteria i love that i just want to draw that out again invest the money in things that generate

00:12:12.580 revenue not things that create the perception of revenue right which is internet culture right now

00:12:17.560 right um number two on my little scratch outline here is people they pay for things before they need

00:12:26.920 to and what i mean by this is like you know and i'm not talking about your bills like you should

00:12:30.900 always pay your bills on time uh you should always pay your invoices uh you know on time but

00:12:36.940 there's no need and and there's no need to like pay that shit two weeks early or three weeks early 0.86

00:12:42.180 because you're trying to stay ahead you have to be cognizant of the flexibility that working with

00:12:47.720 certain partners allows you so utilize the timelines you're given the proper way responsibly like don't

00:12:55.020 don't don't go to somebody like for a long time you know chris and i would never would never utilize

00:13:00.240 terms because we were afraid because we never had any money so like companies will offer us 30 or 60

00:13:05.020 day terms and we wouldn't use them because we were afraid that 60 days would come and we fucking 0.96

00:13:09.580 wouldn't be able to pay and because we were we were poor at managing cash we were inexperienced so

00:13:15.680 the worst thing i could imagine is 60 days come and do and me not being able to pay my bills like

00:13:20.760 you know what i mean like that to me like that's embarrassing some people can live with that shit 0.94

00:13:26.000 it's not my thing um but we used to do it to a fault where it capped it capped our growth to where

00:13:31.620 we couldn't use the the flexibility and the timing to finance our company the right way so you have

00:13:38.100 you know don't be if you've got a legit like if you've got the basis we talked about if you've got

00:13:42.500 a legit product you're investing in things that create revenue don't be afraid to utilize the

00:13:47.660 flexibility that your other vendors and your other companies are willing to lend you now on the

00:13:52.260 opposite side don't abuse them either because a lot i think a lot of people abuse those things you

00:13:57.080 know they get 30 day terms they start paying on 60 days and dude that's a death sentence you can

00:14:01.740 never get out of that trap you know what i mean pay your bills on fucking time decide what a reasonable 0.96

00:14:07.240 amount of time is and use that time effectively you know what i mean yeah yeah so i guess that's

00:14:13.860 your second and third point you just kind of brought them together yeah yeah basically yeah that is so

00:14:18.640 um i mean we right here we have we have basically two different kinds of people we have people who want

00:14:25.400 to pay real early that was always me all right and that limited i probably could have got ahead

00:14:30.000 by three or four more years from where i am now if i would have figured this out earlier all right

00:14:35.740 because i always wanted to pay early i never wanted to have any debt i never wanted to pay anything and

00:14:40.020 you know even to this day um you know i get fucking i can get 188 terms with anybody that we work 0.95

00:14:46.260 with because i know we're going to pay i still only utilize 30 day terms at maximum because i just don't

00:14:51.420 feel comfortable outside of that zone so you have to decide what's going to be comfortable

00:14:55.180 for you and be a responsible human with your cash you know that comes you can always tell if

00:15:01.940 somebody started their business with with their own money because this is they think like me if

00:15:06.640 someone started their business with somebody else's money they'll get out there on the fucking 60 day 0.95

00:15:10.860 90 day 180 day terms and try to fucking you know stretch that shit out you've just got to be 1.00

00:15:16.720 responsible but you know some people that pay ahead i obviously my main point is is by paying ahead

00:15:22.460 you're you're limiting your ability to grow just by just the same you would be if you paid late

00:15:28.100 that's my point yeah you know what i mean and and it may be more responsible and you might be able

00:15:33.840 to sleep better at night but remember you're also limiting your ability to grow and we're only in this

00:15:38.460 game for a certain amount of time so you've got to capitalize on the time that makes sense yeah so

00:15:43.100 it makes philosophical sense but it makes no practical sense pretty much yeah um

00:15:47.700 i mean it's just a matter of comfort you know like dude we started out so fucking broke that 0.94

00:15:56.360 even to this day i even made a status about it yesterday like i wake up every day terrified

00:16:00.740 and i've got a lot of money like we got a lot of money in the company i got a lot of personal money

00:16:04.720 you know like if something happened to me i could live for fucking many many many many many years if 0.93

00:16:10.020 not life without having to work but i'm still freaked out about it you know and that's because

00:16:14.560 i started with nothing and you guys listening who started with literally nothing and they they know

00:16:18.760 what they feel what i'm talking about you know what i mean and um but having that super cautious

00:16:25.060 mindset about your terms and your business partners that you work with can can severely limit your

00:16:30.380 ability to do things uh you know that would otherwise help your business what if you could pay two or

00:16:36.480 three sales people uh for a month and and by not paying your bills on 15 days and paying them on 30

00:16:43.900 days how much more would you sell you see what i'm saying things like that so you just have to think

00:16:49.220 those things through and you have to understand that there's a price to every decision that you make

00:16:53.900 and it's always something that you need to like really sit down with somebody who knows what the

00:16:58.620 they're doing dude having a great cpa a great bookkeeper who's experienced you know that can make a huge

00:17:05.460 difference like like dude our accountant uh who's run our books since day one you know he was young

00:17:13.040 when we started so we've gone through a lot of like and i and dude he's a great friend of mine so i don't

00:17:19.060 want this to sound the wrong way like he's grown with us and learned with us and dude together we've

00:17:23.500 made bad mistakes like hundreds and hundreds of thousands of dollars that we didn't have that we lost

00:17:29.100 by doing dumb shit by just making poor decisions and you know i'm thankful for that now because i know 0.83

00:17:36.420 things but you know and i didn't have a choice because he was so cheap i couldn't afford a real

00:17:41.460 cpa or a real bookkeeper but my point in this is that you know if you can afford somebody who is who

00:17:47.060 has experienced make that investment in a cpa and a bookkeeper because they can really help you figure

00:17:53.020 out how to maximize your your flow yeah that that goes along in my mind that goes along with your

00:17:58.920 first point which is make sure you pay for things that are going to help revenue right if somebody's

00:18:03.020 helping you manage your money well then obviously that's going to benefit but that's but they don't

00:18:06.720 see that's a big balance right a lot of people see those things as as expenses and not investments

00:18:11.840 because they don't see the downside like having a great cpa having a great bookkeeper who's

00:18:17.700 experienced that's not a cost that's an investment you know having amazing salespeople that's an

00:18:23.500 investment you're getting a return you know what i mean having a super effective marketing that's an

00:18:29.380 investment that's not an expense it might be an expense on your fucking balance sheet but if you're 0.97

00:18:34.260 doing marketing the proper way it should be providing a return and it's all how you think about

00:18:39.460 i think you're giving me your fucking cough here bro but um it's all how you think about it and too 0.97

00:18:47.060 many people look at things as expenses and not as investments so you know and a good cpa a good uh

00:18:53.120 a good uh bookkeeper and eventually a good cfo that's a huge investment because you get huge

00:19:00.720 returns on it right so you've identified two bad practices that both have to do with paying for

00:19:06.420 things but what about the other side of like receiving payments from your customers is there like

00:19:12.300 so that's a bad practice that's a great point because i think a lot of people especially

00:19:16.440 where they're in something where they have receivables they're not good at collecting

00:19:20.020 money they're scared to ask for the money and they don't have the policies in place that they

00:19:25.000 you know impose because let's face it there's no there's no uh quote-unquote policy enforcer

00:19:31.440 company that goes out and enforces your policy you've got to enforce it so um you know when you're a

00:19:38.460 young business or you're just getting set into into your ways you have to take the time to develop a

00:19:44.300 clear policy you know a fee penalty you know after late payment stoppage of service uh one two three

00:19:51.300 steps you know this is what happens at 30 days this is what happens at 60 days this is what happens in

00:19:55.480 90 days and you have to go develop the policy of what's going to happen if these people don't pay

00:20:00.400 because and you have to have them sign off on that so they understand that up front because

00:20:05.760 if you don't ever enforce payment like we went back to uh a couple points ago there's a lot of

00:20:12.460 people out there that will stretch you out until you know you can't even operate your business

00:20:16.460 because you're not collecting money to operate so you have to be firm in your policies um about how

00:20:24.520 people are going to pay you now let me add an asterisk to this because there's going to be

00:20:30.360 situations especially if you're in business for long enough where you've done business with somebody

00:20:34.360 for 10 years or eight years or seven years and they've always they've always been there for you

00:20:40.880 and they're going to come to you and they're going to say hey look i need to work something out

00:20:45.080 because business is fucked up right now and i would encourage you to be very flexible in those 0.77

00:20:51.380 situations because at the at the end of the day business and especially small business is so much

00:20:57.000 reliant on relationships and dude i could tell you every time i've ever cut somebody a break or did

00:21:02.120 something right the nice the quote-unquote right slash nice thing for someone it's always come back

00:21:06.900 later tenfold not just financially but friendship relationship in every other way so be firm but

00:21:13.780 also you know be fair and flexible to people who have earned your trust you know what goes around

00:21:18.980 comes around that's right yeah i believe that yeah so um uh so yeah so you have to have you know a

00:21:26.220 very clear plan um i don't think i don't think people put enough time into thinking about how they're

00:21:31.620 going to collect their money they just assume everybody's going to pay and you know when you have

00:21:35.580 receivables i would say 70 of the people will pay on time and you're gonna have to fight for fucking 0.92

00:21:40.100 30 so you need to have clear you're gonna have to so you're gonna have to put a clear policy xyz this

00:21:46.360 is what happens if you don't pay on this timeline and enforce it would you actually encourage people

00:21:52.000 to go to small claims court i would encourage people to put everything in the policy that they

00:21:56.580 need to get their money and stick to the policy 100 so you find a good lawyer that can help you

00:22:01.260 write up a great policy and figure out how to uh collect the money and whatever it takes to collect

00:22:07.640 the money within that policy that's what you fucking do so um you know this is not just about 0.89

00:22:14.320 you have to remember it's not about you buying a car it's not about you buying going to the casino and

00:22:19.020 spending 10 grand this is about you paying your fucking employees this is about you putting food on 0.97

00:22:23.800 their table it's about that's the part of being a ceo that people don't really understand is it's not

00:22:28.120 just about all the glorified shit you have tremendous responsibility to other people to run your

00:22:32.820 business in in a in a responsible way and collecting money is just one of those parts of business there

00:22:38.000 should be nothing personal about it you should never and this goes for you guys who are employees too

00:22:42.260 you should never feel bad or weird or awkward about talking about money you should never feel like

00:22:47.540 that you know money's not a four-letter word money is an essential part of you know life it's an

00:22:54.920 essential part of our existence it's an essential part of your existence and you should never be

00:22:59.900 afraid to talk about it so if whether it's with a customer or whether it's with uh you know a vendor

00:23:05.260 or whether it's with an employee or whether it's you're an employee and it's with your boss money's

00:23:10.040 just a part of the deal man it's nothing there's nothing weird you should feel about talking about

00:23:14.060 it so that makes sense so uh let me let me recap here a little bit so uh the cash flow mistakes

00:23:22.620 that small businesses make or which are common is number one they hear it takes money to make money

00:23:28.160 so they spend money on things that they don't really need to spend money on number two they pay

00:23:32.040 for things before they need to number three on the other hand they don't pay for things on time so

00:23:37.240 they end up getting penalties and fees and that sort of thing and then uh number four is they don't

00:23:43.480 have set policies in places for late or non-payment for customers and they aren't proactive about getting

00:23:48.700 customers to pay right all right so number five big mistake that people make is that they rein in

00:23:58.100 spending in places that they shouldn't okay so like they they freak out because cash isn't there

00:24:02.960 and they're like oh i'm gonna slash all this shit and instead of slashing things that they don't need 0.96

00:24:11.360 they slash the things that i spoke about a minute ago that are investments that are going to make a

00:24:15.520 return so what i mean by that is this they'll say oh you know we're 30 grand

00:24:20.740 fucking short this month we got to make adjustments this month so they'll go out and cancel all their 0.90

00:24:26.100 fucking marketing right because their marketing budget is 30 grand right or they'll go out and

00:24:33.900 they'll cancel uh you know sales people's budgets for travel or this or that or they'll do something that

00:24:40.960 takes away something in their company that's actually producing a result or in the process of producing a result

00:24:47.640 and but they'll keep their personal assistant and they'll keep their least bmw right and they'll keep

00:24:52.760 all the shit that makes their daily life comfortable and that's the shit that you should be cutting the

00:24:57.860 fucking personal assistant the fucking uh you know the luxury car the the the expensing the travel uh all the 0.98

00:25:07.220 shit for you so you start cutting that shit out first and you let these other people go out and do 0.97

00:25:12.900 their fucking job so we can get out of this cash flow issue you know but many many many businesses make 0.87

00:25:18.000 the mistake they'll fucking cut marketing they'll cut their sales staff they'll cut things that are 0.98

00:25:24.160 actually going to produce a result and when in reality what you should be doing is probably reinvesting

00:25:29.640 more into those people not just money but time and energy to help them be more effective so stop

00:25:35.960 cutting the shit that's an investment start cutting the shit that's a legit expense in your experience 0.92

00:25:41.220 is the thing that usually goes first is it the marketing yes always because people know how to

00:25:45.660 market so they nine out of ten of the people listening right now that are that are in business

00:25:51.580 their biggest challenge is marketing their biggest challenge is getting attention because they they've

00:25:57.060 read all these fucking marketing books that are written 20 fucking years ago that make no fucking sense 0.97

00:26:01.740 and they're not relevant in these two in this time or they didn't read anything and they just do what

00:26:07.700 their competitors do okay and you can never win like that you can never win long term like that you have to

00:26:14.480 build an identifiable stand on its own brand that brings people in gets them engaged makes them feel a

00:26:21.740 part of your company and makes your company feel a part of their lives and you have to build a real brand

00:26:27.660 and that shit is not easy you can't just do that with uh you know copying what your competitors do 0.66

00:26:33.860 you know it's like copying a test in fucking high school like you're you don't know the answers so 0.91

00:26:39.360 you're looking over at the dude next to you and you're copying that motherfucker well you don't know 0.75

00:26:43.280 if he fucking knows either you know what i mean and chances are we talk about marketing he doesn't 0.92

00:26:48.400 know so you're going out copying some dude that doesn't know instead of going out and teaching

00:26:52.660 yourself the skills that you need to learn to win and that is it that's a huge problem and people

00:26:57.920 don't understand it because because they don't put the time into it so when it comes time to cut

00:27:03.000 something they're not seeing an effective return on their marketing so they just fucking cut it 0.96

00:27:07.400 because they don't know what they're doing you see what i'm saying so like oh well and sometimes

00:27:12.920 it's working and they don't even know it's working because they don't know how to track it

00:27:15.680 what do you say to the person who's like well you know stands in front of the staff and says

00:27:21.560 you know you guys just aren't doing doing what you need to do so life's going to get a lot less

00:27:26.260 comfortable around here we're going to can the i don't know coffee machine the free donuts all that

00:27:32.040 kind of stuff is that is that just cutting off your nose to spite your face no i mean dude i'm a big

00:27:37.240 believer in making things very fucking tough on your employees when they're not doing their jobs 0.87

00:27:40.900 but there's a difference between making things tough on your employees when they're not doing their jobs

00:27:44.800 or making things tough on your employees when they are doing their jobs and you're just too dumb to 0.51

00:27:49.440 realize that they're doing their fucking jobs and trust me because i've done both you know what i 0.96

00:27:53.440 mean it's very easy to blame everybody else at the end of the day it comes down to being responsible

00:27:58.080 and taking responsibility for the company if the fucking numbers aren't there it's not their fault 0.97

00:28:02.400 it's your fucking fault if it is their fault it's still your fucking fault because you didn't stay on 0.99

00:28:06.860 top of them coach them give them the skills that they needed to have give them the uh the autonomy

00:28:12.140 to do the job there's a million things you could be doing wrong but at the end of the day if the

00:28:16.140 numbers aren't there it's you it's not them so you've got to figure out how to make the numbers

00:28:20.040 there and you know i'm i'm all for if i truly think that my employees aren't doing their fucking 0.98

00:28:24.960 job i will make shit uncomfortable and they know that but if they're doing their job i don't even 0.86

00:28:29.420 care if they come to the fucking office or do whatever just do the fucking job you know what i'm 0.99

00:28:34.040 saying so like there's pluses and minuses on both sides but no i'm you know hey you know if we've got

00:28:41.600 when things are good everything's good you know making it comfortable is great but uh the minute

00:28:49.220 things start to go bad you know i make them uncomfortable shit so they appreciate the times 0.93

00:28:53.280 when it's good and they want to make good again so i don't have a problem with that but i think a lot

00:28:57.900 of people blame their employees for shit that's actually their fault i think a lot of people and dude

00:29:02.000 you know i used to do this a lot you know i would i would just get so pissed at them when in reality i

00:29:07.800 wasn't giving them the proper things they needed to do to do their job you know and that's you know

00:29:14.380 that's years ago but the point is i've been through that so i know what that feels like and it's you

00:29:19.260 know it's counterproductive because then they end up fucking hating you so you have a whole staff of 0.95

00:29:23.320 people out there trying to fucking do the job for you and you're just screaming at them all the time 0.94

00:29:27.440 tell them how much they suck um that's not going to end well for you as a business owner so you've 0.61

00:29:34.900 got to be very very uh in tune with what the real issue is and handle the real issue and another

00:29:42.700 thing i'll say too is like let's say you have a staff of 20 people or 30 people or 40 people and

00:29:46.680 you've got three bad ones don't yell at the whole fucking team pull the three bad ones aside you know 0.99

00:29:51.940 what i mean a lot of people do that too and i've done that too where i've yelled at the whole company

00:29:55.980 for fucking you know 10 of the people that needed to get yelled at so to speak or smacked in the ass 0.96

00:30:03.380 however the fuck you want to say it you know what i mean right right so i'm looking at the uh photocopy 0.59

00:30:08.080 of your notes here and i'm actually a little surprised that point number six is they don't

00:30:12.620 take advantage of credit cards because i i guess the way i think credit cards are uh at least in

00:30:18.060 america a very abused thing and you're saying the opposite you're saying that they don't take

00:30:22.100 advantage of credit cards um there's huge benefits to some of the way that the cards are structured um

00:30:29.220 for example like a lot of my friends they use a fucking black card to buy their inventory all 0.86

00:30:35.120 right the black american express yeah let me tell you about the the centurion card let me tell you

00:30:39.360 about it it's five thousand dollars a year okay to even have it it's made out of titanium okay when you

00:30:47.060 go to the bar and you're going to pay for a meal you look badass you flick click you throw it out

00:30:52.380 it clinks on the table everybody thinks you're a fucking baller right but it gives you no real 0.90

00:30:59.060 benefit other than than what the platinum card gives you and it costs five grand a year so american

00:31:04.860 express has this other card called the plum card the plum card is a cashback card uh you can get up two

00:31:10.180 percent back on whatever you buy well i don't know about you but i'm in business to fucking make money 0.95

00:31:15.640 not pretend to be a baller so i would rather get you know two percent back for every fucking hundred 0.96

00:31:20.200 grand i spend and be able to you know at the end of the year i'm able to pay multiple people's salaries

00:31:25.280 out of the cash back i get off that card and you know what i don't get to go to the fucking uh to the 0.97

00:31:30.120 bar and pretend like i'm a fucking baller and click my card out like i'm some kind of fucking big dick 0.99

00:31:34.080 motherfucker but i'm also paying two or three other four other people's salaries off of what i spent on 0.82

00:31:40.740 the card so it depends on what your priorities are i guess but my point being is that there's

00:31:46.540 tremendous benefits to some of the cars for small businesses and people don't you know you've got to

00:31:51.020 be savvy when it comes to finances because i don't know about you guys but you know i sure as fuck 0.83

00:31:55.420 don't have all the money in the world i know you don't either so you have to pay attention to the

00:31:59.400 things that you can utilize and two percent back on a year's worth of buying inventory think what that

00:32:04.080 would do to your company if you bought a million dollars worth of inventory what would you do with an

00:32:06.980 extra 20 fucking grand you know i'm saying yeah and i mean as i'm thinking i'm thinking 0.95

00:32:12.240 even if you don't spend the money it's a two percent extra margin on your fucking product right 0.90

00:32:17.000 you know what i mean so like dude you you know people just they you just got to be savvy man you've

00:32:23.120 got to be aware you know i'm very lucky to have a great business partner who's very aware of these

00:32:27.440 kind of things but um you know whoever it is whoever you deal with whoever uh you know you're

00:32:37.280 in business with you know make sure you surround yourself with smart people not people who just

00:32:41.400 want to play business like that black card thing like when i see somebody with a black card i fucking 0.98

00:32:45.840 laugh at them i'm like you're a dumb motherfucker you pay five grand for a fucking card don't mean shit 1.00

00:32:51.120 and anybody can get it if you spent like anybody with a small business

00:32:54.940 could you know could get one basically if you're if you're a decent you don't have to be decent

00:33:00.920 sized right it's just uh it's a it's a fucking show-off thing right um i know that there are 0.98

00:33:08.200 people out there who would say oh two percent doesn't sound very like a lot but but like you

00:33:14.080 pointed out if you're if you're spending hundreds i pay for my whole fucking i pay for my whole creative 0.98

00:33:18.440 team off my fucking off my plum card yeah i mean and the thing i mean just goes down to the 0.97

00:33:24.120 principle of really successful entrepreneurs say every little bit it counts it does every little

00:33:29.280 bit yeah dude i have to pick up fucking pennies when i'm walking down the street people laugh at me 0.97

00:33:33.300 you know i'm afraid that if i pass it like i'm sending the wrong message to the universe like

00:33:37.720 fuck dude that means the universe gonna think i don't need any more money you know so i pick up 0.91

00:33:41.860 everything and my last vacation was all reward points yeah exactly flight hotel cruise yeah i mean

00:33:48.440 it's people don't uh people don't um take it seriously and there's serious benefit to it um

00:33:56.420 the next point i want to cover though this is a big this is a huge point um because i really

00:34:02.000 fucked this up in my business and i want to stress how important it was uh 0.77

00:34:06.080 you so many of you guys you wait until you actually need a line of credit or support from a bank or a

00:34:16.580 financial institution to go look for it all right and let me explain why this is a bad idea

00:34:21.340 when you need when you need money you're risky the banks see it they see it in your books they see it

00:34:29.420 in your face they hear it in your voice they know you're fucking desperate and you need it and they 0.94

00:34:34.080 don't lend people money that need it okay so you have to be very aware and you have to be very

00:34:42.920 prepared ahead of time and you have to develop uh a great set of books okay that's a point that's

00:34:50.300 that's point seven a okay a lot of small businesses don't take books serious if you don't have books

00:34:55.600 you don't even have a business if you don't have a legit set of books your business doesn't even

00:34:59.980 exist so make sure that you spend the money to get the proper reports learn how to read financial

00:35:06.040 documents learn how to read a profit and loss learn how to read a balance sheet learn what all the

00:35:11.280 shit means and have your books ready to go all time because i didn't even have a set of books in 0.55

00:35:16.680 my business for for like seven years and i had to go back and fucking recreate them you know what i 0.93

00:35:21.380 mean like we had to go back and dissect all it was a huge expense and um you have to basically

00:35:28.100 understand that that shit is important because if you don't have a great set of books nobody's 0.72

00:35:32.520 gonna lend you any money all right and and people people lend money on facts not on what you're gonna do

00:35:37.900 or what you did they lend money on what the fuck you have right now and if you wait until you're in 0.72

00:35:43.180 a situation where you need the money to get by you're not gonna ever get it so secure the credit

00:35:48.440 before you need it create a relationship with the bank even if you're never gonna fucking use the money 0.90

00:35:53.600 you know even if it's a ten thousand dollar line of credit start a relationship and then over the over

00:35:59.280 the you know time of two three four five years you can grow that ten thousand dollar line of credit

00:36:04.860 into you know a million dollar line of credit but if you if you go in and say i need a million bucks

00:36:09.900 right now our business is going to fail you're not going to get a million bucks because it's a risky

00:36:13.900 thing so you have to make sure that you're preparing yourself properly for um you know the situations

00:36:21.240 where you're going to need the credit ahead of time by securing it ahead of time so what's your

00:36:25.340 what's your experience regarding the pros and cons of national banks versus local banks

00:36:31.120 look uh we've only dealt with one bank and it was only for a few years uh it was a small bank

00:36:40.280 um you know they're a local bank they were great to us they treat us very very well uh we used them

00:36:47.240 for four or five years and then we ended the relationship because they sold uh and then we

00:36:51.320 haven't used one since but so i don't have a lot of experience with big banks uh a lot of my friends

00:36:56.440 use big banks you know when you get into that mid-market cap where you know you're you're anywhere

00:37:01.620 from you know 50 million dollars to 500 million dollars in revenue you're gonna need to go to a

00:37:07.080 big bank to get the proper line of credit for most of the people listening now they're gonna be able

00:37:10.860 to go to a small community bank and this is why some small community banks exist is to help people

00:37:15.440 like us so you've just got to have your shit together that's all i'm saying yeah so makes sense um and 0.81

00:37:20.520 what i like about a small community bank too is you can call and talk to the person

00:37:24.040 directly there you know we had the same guy his name was tony we had him for the whole time we

00:37:28.960 were there he he's still a friend of ours he took care of us he gave us good advice you know he taught

00:37:34.680 us a lot of things that you know the we're the anomaly right like we've done it without much financing

00:37:40.560 um you know a lot of people have to have it and i would recommend building a relationship with the

00:37:47.480 bank uh from day one like even if you have even if you have nothing to get from the bank

00:37:53.040 go in to the bank and meet with their loan officers and say hey the commercial loan guys

00:37:58.420 and say hey look i just started this business i don't really know uh what it would take to work

00:38:04.000 with you guys but i would like to become a company for you to work with you know down the road two

00:38:09.700 three years from now so maybe i could come in you know once every quarter and talk to you about where

00:38:15.980 our company is show you our books so that they could begin to trust you and so many people wait

00:38:20.720 they walk in off the street it's the same as some dude walking up off the street to me and say hey

00:38:25.240 dude i need 10 grand i'm like fuck you man i'm gonna give you 10 grand it's the same thing the banks do 0.98

00:38:29.920 you know what i mean they gotta know you so you know start that process proactively from the beginning

00:38:35.180 it's a there's nothing bad that could come of it you will learn a ton of stuff you know i i have

00:38:42.180 recently been reading up on the uh the story behind i i don't know if you ever watch anything you

00:38:46.820 probably don't but chip and joanna gains they have the they have the big empire it was a real

00:38:51.440 estate empire it's uh magnolia and they've got a they've got a um home improvement show on hgtv

00:38:56.700 but i at one point when they were developing their real estate empire they were short something like

00:39:03.000 a hundred thousand dollars for the project that they needed that was that was supposed to be covered

00:39:07.240 by the bank and i was a little surprised when as they told their story basically their contact at

00:39:13.840 the bank who they had a really good relationship with basically said hey listen i'll work with you

00:39:18.620 and i think maybe what people don't realize is that there aren't these hard and fast rules no right

00:39:24.280 exactly like there's a human element there is what when you get into bigger banks it becomes more

00:39:29.340 ridded because there's more financial restrictions and and to be honest the commercial uh restrictions on

00:39:34.740 on business loans have gotten way more strict than they used to be but with small banks there's all

00:39:40.520 if you can develop a relationship like i'm talking about there's huge amounts of flexibility that they

00:39:46.300 can offer you like dude they don't want to lose their investment so if if they if you have a hundred

00:39:50.680 thousand or two hundred thousand dollar line of credit with the bank and let's say you're out on it and

00:39:55.420 you're short and you go to them and say hey man uh we're i know we're out on the loan but we need

00:40:00.160 like another 200 grand because we're gonna do this this and this that's that's what they that's what they

00:40:05.700 essentially want and that's how they want to grow the line they don't want to grow the line

00:40:09.720 when you don't need it they want you to use the money they want to earn the you to earn their trust

00:40:16.020 they want to understand your business and they want to know if they give you another 200 grand not only

00:40:20.360 are you going to fucking use the 200 grand uh the 400 grand that you now have but you're going to go 0.95

00:40:25.480 out and you're going to come back in a year and and your your revenue is going to be triple and

00:40:29.940 you're going to need another 200 grand that's what they want but it's the opposite of what people think

00:40:34.420 right they're in that's how they make their money so they just want to do it without you

00:40:38.900 going out of business right but the success of that is driven by well obviously driven by the uh

00:40:44.000 the success all the things we talked about but you have to start the relationship early

00:40:47.880 right relationship right definitely so another thing people do with cash flow uh to fuck up their

00:40:53.460 businesses and there is two sides to this and i want you to listen very carefully the first side is

00:40:59.100 they hire employees before they need them and what i'm gonna i'm gonna preface this they hire non-essential

00:41:04.300 employees okay this goes back to the playing business shit they hire a fucking secretary they 0.97

00:41:10.060 hire do we still don't have a fucking secretary to answer the phone here you know what i'm saying 0.97

00:41:14.360 uh they hire a cleaning crew they hire this instead of doing that shit themselves 0.89

00:41:20.140 okay so they hire non-essential employees too soon and they hire essential employees too late

00:41:27.220 all right and essential employees are this people who sell your product people who service your

00:41:33.380 customers okay frontline people all right you have to look at them as an investment like we talked about

00:41:40.180 earlier because when you put people out there and let me just you know preface this with with uh

00:41:46.960 let's say you're a company and you're doing outbound sales out of your uh out of your office okay and

00:41:53.160 you have three sales reps and let's say each sales rep sells you know let's say you do 60 grand a month

00:41:59.740 so they're each doing 20 grand all right you're not going to get to 100 grand if those people are doing

00:42:06.160 eight to 10 hours of work a day and maxing out at 60 grand until you add people in so what i'm saying

00:42:12.260 is is people will say well when we get to 100 grand we'll add three more people well look you're not going

00:42:16.060 to get to 100 grand without adding three more people so you got to look at it as an investment and a lot

00:42:21.140 of people don't do that when it comes to people who sell for them or people who serve as customers

00:42:25.360 customer service reps real ones like in how not fucking india i'm talking about in america that 0.99

00:42:31.400 can actually help your customer those people are just as important as your actual outside sales rep

00:42:35.820 because they could provide such a great customer experience with your existing customers that those

00:42:40.420 customers will go out and organically share the story which will help grow your transactions

00:42:44.460 you see what i'm saying yeah that makes sense so uh the both sides of this don't hire non-essential

00:42:50.100 employees until you actually fucking need them all right so let's use this example let's say you're 0.91

00:42:56.700 you're to a point where uh you know you have the three sales reps and they're only instead doing 60

00:43:05.940 they're only doing 40 grand a month so they have a little extra time to clean up the office so you

00:43:10.700 don't have a cleaning crew right um that's how you should do it okay for a number of reasons why it

00:43:16.840 makes sense financially two it teaches everybody discipline it teaches everybody to be humble it

00:43:22.160 teaches everybody this is a team effort there's a lot of cultural reasons there that i'm a big believer

00:43:25.540 in um but let's say you got those three people and they're doing 60 grand and they're working

00:43:31.080 fucking 12 hours a day busting balls and you still got them cleaning the office well now it becomes a 0.91

00:43:35.520 math thing right do you want the fucking office clean or do you want the sales and clearly the sales 0.98

00:43:40.120 are more important so you can either add more sales people in bring their volume down and they

00:43:44.580 it's still clean which is actually what we do because i believe in the culture of benefits of

00:43:48.140 cleaning the office we don't have a cleaning staff um or you can add a cleaning staff to relieve the

00:43:55.280 pressure off these people and let them do their jobs which is what most companies do i'm just kind

00:43:58.620 of fucking weird because i believe in in getting your hands dirty so um well we used to but we reversed 0.99

00:44:04.840 it yeah we did yeah no it goes back to what vaughn said about making people comfortable we used to

00:44:08.880 have a cleaning crew and and and these motherfuckers in the office got too comfortable so i fired a 1.00

00:44:12.920 cleaning crew made everybody go back clean the office that's yeah i mean it is funny that they

00:44:18.480 used to also have personal fucking parking spots out here and i pulled up one day and fucking put 0.98

00:44:22.600 them all in the back of my pickup and drove off without saying shit because everybody thought they 0.86

00:44:26.600 were a fucking celebrity because they had a little fucking sign out here with their name on it yeah you 0.91

00:44:31.300 know what i mean it's kind of one of those paradoxes that you when people work hard they get to a level

00:44:35.300 where they they feel like they've earned comfort but then when they start experiencing the comfort

00:44:39.180 they get lazy they get lazy and it undermines it that's right yeah so um all right i don't even

00:44:46.380 know where we were you had uh well let me recap because um okay i uh let's see starting with uh

00:44:52.860 point number five was they rein in spending in places they shouldn't number six is they don't

00:44:57.880 take advantage of credit cards number seven is they wait till they need credit to secure it number

00:45:03.940 eight is they hire employees before they really need them or you said the flip side of that is that

00:45:09.440 uh they don't hire employees that they really need right soon enough right and then number nine

00:45:15.700 is your next point okay um they aren't innovative in finding sources of cash okay or avoiding

00:45:23.600 expenditures and cash all right look and what i mean by this is this if you're short on cash you're

00:45:29.220 driving around in your brand new car you're a fucking idiot okay sell your fucking car invest your 0.99

00:45:34.180 money in your business buy a cheap reliable car and pay your fucking dues like every other 0.94

00:45:38.820 motherfucker in the face of the earth that's built successful company people right now they see uh

00:45:44.100 you know they don't want to take a step back gary v says this a lot he talks about people uh and

00:45:48.960 i agree with them a hundred million percent on this point and you know i don't agree with

00:45:53.300 everything he says i love gary he's my boy but this is something i one million percent agree with

00:45:58.840 is that you take a fucking dude you take your step back you make yourself uncomfortable and you 0.99

00:46:04.380 fucking put money where it's gonna make money all right it's a lot of people like even me you know

00:46:09.100 i'm into cars i like the flashy shit it's just my personality you know it's the shit i dreamed about 0.77

00:46:15.260 my whole life i'm in a position where i can afford to do those things so they see me doing those things

00:46:20.660 and they think that's what being an entrepreneur is about well let me tell you i spent far far far far far

00:46:25.300 more years driving hunks of shit living like a fucking bum dude for years and years and years 0.99

00:46:33.060 i had i had i don't even know how many more employees all of them make more money than me

00:46:38.540 all of them that's what being a ceo is about a real ceo okay so you have to take your step back

00:46:45.120 you have to understand that like dude i'm gonna cut the shit that's not essential and i'm gonna 0.97

00:46:50.480 fucking figure out how to make some cash flow happen and that's part of the journey you know i get 0.69

00:46:54.560 questions all the time i was looking through some of the questions for the frisella factor youtube

00:46:58.320 show you know and these people are like oh oh you know i don't want to move out of my i just got to

00:47:03.860 this new house and you know now i'm having trouble with money well fucking move out of it motherfucker 0.99

00:47:07.420 you know because that's what it takes they don't want to take a step back they don't feel like that's

00:47:12.980 the right and you know what uh that's just part of being an entrepreneur it's part of being a ceo

00:47:17.580 you're gonna have to be the first guy to make sacrifices and you're gonna have to be the last guy

00:47:21.600 to reap the fucking rewards and that's just the way it is you know what i mean because if you're 0.96

00:47:26.160 the dude driving around a brand new car and none of your other motherfuckers can even afford to pay 0.99

00:47:29.400 their fucking rent guess what they're gonna fucking hate you that's what struck me about your story 0.97

00:47:34.320 yours and chris's story that early on you know you're strapped for cash and you're not even living

00:47:39.120 in a you know really run down apartment you're not living in an apartment at all no you know like

00:47:44.460 you're staying overnight people's houses yeah but you're vaughn i'm telling you dude like i tell

00:47:49.420 that story and people think it's bullshit right you know i'm saying i tell people that and they 0.71

00:47:53.960 think it's bullshit they think it's made up they think because like dude every motherfucker on 0.94

00:47:57.700 instagram right now has a quote-unquote story of rags to riches i'm gonna tell you right now we live

00:48:03.320 that shit now everybody else can fucking say whatever they want you know i see these guys like 0.94

00:48:07.980 oh 14 months ago i was living in my mom's basement now i'm a millionaire bullshit you know what i mean 0.82

00:48:15.100 we did it we lived it i got people who i mean numerous people who know us as that and uh you

00:48:26.780 know we're still doing it and that's why you know you could tell that we really did that because both

00:48:32.080 him and i are scared shitless that we're going to lose it every fucking day you know and i don't want 0.99

00:48:36.580 to go back to that you know and that's a great thing that's a great thing dude to have that hunger

00:48:41.340 to have that intensity to have that fear that you're going to go back and be broke when you've

00:48:46.340 already started to do some good things what do you think makes you want to do better what do you

00:48:49.760 get you up in the morning because when you start with somebody else's money and you invest it and

00:48:54.640 you turn it into something you never really experience those hard struggles you never really

00:48:59.360 experience that fucking grind the real grind and because of that you're never really afraid because 0.91

00:49:04.420 you don't know what it's like and that fear is the biggest driving force that i could even

00:49:08.560 comprehend uh at this point in my life and i hope that it stays that way for my whole life

00:49:12.880 you know i don't want to ever be comfortable like dude i enjoy the nice shit like i enjoy the 0.89

00:49:18.020 flying on the private plane and driving a fucking lamborghini or whatever i enjoy it but i don't ever 0.92

00:49:23.280 take it for granted i don't ever say this is my life like every day i get in my nice car i drive

00:49:28.620 somewhere i go on a trip and i meet some successful people i try to step back and be like goddamn dude 0.73

00:49:34.360 if they only knew i'm just some broke ass dude from south saint louis county you know what i mean 0.74

00:49:39.480 like that's how i feel about myself but i don't want to ever lose that you know yeah no that's

00:49:44.120 important yeah i uh i'm just belaboring the point here but i what year was it that you guys started

00:49:49.980 99 so 99 so what do you think the average apartment costs in 99 uh down in springfield our

00:49:57.140 first apartment we had was like 400 a month or something right so 400 a month for a three bedroom

00:50:01.680 right for a three bedroom so 400 a month you know probably 100 100 in in utilities a month yeah

00:50:07.960 i mean that's what that's over five five six grand a year right and again people say oh five six

00:50:14.500 grand but he they were doing a manufacturing business in a retail store that's a lot of money

00:50:19.220 yeah or it's it's every little bit counts like that so like that and but we still run our business

00:50:24.120 like that like people don't understand that because they look at it like let's just say like let's just

00:50:29.140 say you know i've got fucking like 10 cars now and they look at like let's say the aventador and 0.92

00:50:33.800 they say dude that's a six hundred thousand dollar fucking car and they're like you know um they think

00:50:40.440 of it in their terms so they're like god dude to afford a six hundred thousand dollar car you know

00:50:44.280 that that would take all my money so i'm sure that's taking all his money no i live very fucking 0.95

00:50:48.240 responsibly you know what i mean like we're doing very well so like what i spend money on like i know

00:50:54.620 it doesn't look like from the outside but in relative terms i'm very fucking responsible with 0.91

00:50:59.720 my money you know what i mean so we're we still live in the same way where we're we're not spending

00:51:05.300 not even close to what we make and we're taking most of our money and putting it back in our company

00:51:09.780 it's just that our company's gotten so big that the little money that we do take is a lot more money

00:51:14.840 than most people fucking make it's relative right it's all relative so you you know what i mean you 0.88

00:51:19.700 have to think of it like that no absolutely um so this is related a little bit but one of my favorite

00:51:24.480 posts that you ever posted in the last couple years was you posted something about it i don't

00:51:29.080 know if it was when you were still doing um what was that a social media platform periscope yeah but

00:51:34.480 you posted the fact that you you got a speeding ticket it was like a 200 ticket yeah and some guy

00:51:40.140 posted and i you know i don't blame him but he posted like no big deal hey hey andy and your

00:51:44.940 response was yeah it's a 200 parking ticket yeah and 200 bucks 200 bucks it's 200 bucks it

00:51:51.080 doesn't matter if if it was when you were starting out or now yeah and again the longer i'm around you

00:51:55.820 and and i confess i've had to learn this in my life but the longer i'm around you people who are

00:52:01.040 wealthy and stay wealthy they don't look at it oh it's only 200 right they put a name on everything

00:52:07.320 that they spend right and if they had to spend 200 like they know right exactly it pisses them off

00:52:13.320 you know that that's actually a great transition in the last point which is you know and it's it is

00:52:18.980 the most important point okay you've got to know where every dollar is going and this is basic shit

00:52:24.680 right i know where every dollar is going but dude it's amazing to me that when i sit down like with

00:52:30.360 other entrepreneurs or young business guys or young business girls and i start asking them questions

00:52:35.220 they don't even know the basics of a cash flow report or uh you know or where they're what how much

00:52:42.380 they spend on marketing or how much they spend on uh payroll or like dude i could tell you to the

00:52:47.680 fucking pay period how much i spend on payroll i could tell you to the fucking penny what i spend 0.99

00:52:53.920 on marketing every week i dude when i look at my fucking cash flow report that i get every single 0.98

00:52:59.080 morning i it's like the matrix like i fucking see shit that people would never see i can look at our 0.95

00:53:05.180 cash flow report because i've been doing it for 17 18 years now and i could tell what my i could tell

00:53:11.880 what questions my fucking sales reps are asking when they're talking to people i could and i could 0.99

00:53:17.080 tell what because i could tell what products they're selling and not selling i could tell uh if they're

00:53:21.700 following up with their customers i could tell all kinds of crazy shit by looking at the numbers

00:53:25.720 and so you have to start discipline yourself to get yourself the proper reports on every single day basis

00:53:34.260 know where your money's going know what it's doing you can start to figure out why things are going

00:53:40.700 and you'll have a you'll start develop this amazing like 3d comprehensive vision of what's going on in

00:53:47.060 your company to where you don't have to go and sit with your sales reps to find out what they are or

00:53:52.680 aren't doing you could just see it on the report and that's what you need to get to so you know a lot

00:53:58.040 of people discount you know oh you know that was only 50 bucks or we went to lunch and that was

00:54:02.440 that was you know 100 bucks or we did this and that and they don't have the discipline to really learn

00:54:08.020 the numbers and i think a lot of people like i think a lot of people would be surprised like

00:54:13.280 how how much of a numbers person i am like i i live and die by the numbers you know what i mean

00:54:22.140 uh and i didn't learn that shit in one day i learned it a little at a time over the course of time 0.74

00:54:28.480 and so even if you're just starting out and you you uh are selling two or three or four items a day

00:54:34.540 you need to develop reports because if you could develop the reports now and dude you they're

00:54:39.200 gonna people are gonna say where do i develop these reports dude build out an excel sheet learn

00:54:43.080 how to use excel excel is an amazing tool all right um as you grow to a mid-sized company you'll

00:54:49.640 have you'll have a company come in and help you develop custom reports and software but i mean

00:54:53.960 those are expensive you know i think our last software was over a million dollars but

00:54:58.900 but until that time we were doing on excel which was free so don't let the lack of understanding

00:55:05.560 how to do this stop you from doing it build out a basic excel sheet oh you don't know how to use

00:55:09.840 excel well there's this amazing tool out there called youtube it'll teach you all you need to know

00:55:13.440 about excel don't you hate math too i do i was terrible at math like when i when i on my act i scored

00:55:19.420 above 30 on every single category except math i've got a 19 but that's because i rely too much on reports

00:55:25.200 and not enough on actually right i rely too much on technology but the point is is that you know

00:55:30.480 um i love math i love math when it's money but if it's math or other shit i don't like it you just 0.91

00:55:36.800 like count your benjamins right right right so so you know guys take that last point serious you know

00:55:45.880 build little reports do them yourself you don't need to hire somebody to do that and if you have

00:55:51.060 questions you can usually find the answer through youtube and just start building through excel and

00:55:55.640 eventually you'll be able to create these reports for your company to look and you'll be able to see

00:55:58.840 everything that's going on and and you it's going to make you a better business person guys if you're

00:56:04.700 not following andy yet on instagram he has a newly minted verified account yeah so at andy

00:56:12.060 frisella on instagram and snapchat are you still mfceo dash one yeah yeah on snapchat and then uh

00:56:18.260 facebook.com forward slash andrew frisella that's right all right and make sure you go to uh

00:56:24.440 ask the mfceo.com submit your questions for frisella factor uh we've got a couple shows already

00:56:30.380 taped we're trying to build up a little bank before we start putting them out uh that's going to be

00:56:34.220 well it already is for us a lot of fun so uh if you have a question like we don't really do a q a

00:56:39.380 segment on the podcast too much so if you have a question for us uh if you want to know something

00:56:44.020 you know this was a good podcast on practical knowledge if you have a good practical

00:56:47.900 question if you have a mindset question whatever question we're going to answer them all on the

00:56:52.240 show so uh ask the mfceo.com check that out and guys as always you know um i don't monetize this

00:57:00.320 this platform uh i do this because i love it and i'm not saying i won't monetize it at some point i

00:57:06.380 just don't now and you know if you found this podcast valuable uh please you know reciprocate that

00:57:12.120 value by bringing us at least one friend sharing the podcast maybe make a post for us uh just

00:57:17.880 do something to help us grow this because the reality of what we're doing here is that we're

00:57:22.660 teaching the shit and helping people do things in a realist way okay we're taking the real things for

00:57:29.080 real experience and teaching people how to grow themselves and their businesses their financial

00:57:34.140 income and the rest of their lives through the principles of entrepreneurship so if you know

00:57:38.940 someone who would enjoy the podcast you know turn them on to us is that it i got nothing to add to

00:57:44.760 that all right guys thanks so much we'll talk to you next time

00:57:47.000 you

REAL AF with Andy Frisella - May 09, 2017

How to Manage Cash Flow, with Andy Frisella - MFCEO143

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