It's Not About The Money

The Many Hats of an Entrepreneur
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[00:00:00] Steve: Okay. Shall we begin?

[00:00:02] Tyler: Yeah.

[00:00:09] Steve: Hello there, dear listener, and welcome back from our little bit of a break. Uh, I am Steve.

[00:00:16] Tyler: And I'm Tyler, and this is another episode of It's Not About The Money, the podcast where we help you gain the clarity you need to run a successful small business.

[00:00:25] Steve: Tyler has a financial coaching practice and I run a tax business and we just got through tax season. Hooray, we are both small business owners like you, and this podcast is our exploration of entrepreneurship one episode at a time.

[00:00:42] Tyler: So what are we talking about today, Steve?

[00:00:44] Steve: Today, we are kicking off a new season, sort of, a new little series, that, we'll tentatively call The Many Hats of an Entrepreneur. So you will know that, as you're running a business as a [00:01:00] soloist, there's A whole bunch of things you have to do to make the business run, and not all of them are related to your core competency, the thing that you got into the business to do, the service that you're providing to the clients.

There's also the marketing and the finance and the sales and the, all of that stuff that goes along with it. So what I am hoping to do here with you and with the folks that we're going to interview over the next few weeks. is help us get a sense of what are the core functions that have to be performed in a business?

When is it good to do those yourself? When should you outsource them? Uh, how do you know, uh, when and how to hire such a person? Uh, if you do decide to do it yourself, what kinds of questions do you need to be asking? What do you, what skills do you need to learn so that you can do it? Well, all of that kind of stuff. then [00:02:00] hopefully get us all, you know, upskill all of us as we're. Running our businesses here so we can get better at, at these things.

[00:02:09] Tyler: Cool. Sounds good.

A business is a repeatable process that...
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[00:02:12] Steve: So the framework I'd like to start with, uh, in this episode as we're kicking this off, is from a book that I have not yet read, but it's been on my shelf for a long time, but I pulled it out the other day. It's, it's called

[00:02:24] Tyler: you learned through osmosis though? It's kind of nearby you. The knowledge just kind

[00:02:28] Steve: look at it all the time. It's called The Personal MBA, Master the Art of Business.

It's by Josh Kaufman. And, uh, near the beginning, he has this passage describing the five aspects of every business. Here's what he says. Roughly defined, a business is a repeatable process that, 1. Creates and delivers something of value. 2. That other people want or need. 3. At a price they're willing to pay.

4. In a [00:03:00] way that satisfies the customer's needs and expectations. And five, so that the business brings in enough profit to make it worthwhile for the owners to continue operation.

[00:03:11] Tyler: That makes sense.

[00:03:14] Steve: Creates and delivers something of value that other people want and need at a price they're willing to pay in a way that satisfies customers needs and expectations so that the business brings in enough profit to make it worthwhile for the owners to continue operation. I think it's a nice way of summarizing it.

[00:03:27] Tyler: Yeah.

That is a nice summary of what a business is, especially like the part where it's a repeatable process. Sometimes when you're getting started, it doesn't feel that way, but there are a lot of problems inherent in, in those. steps or those phases that need to be solved for it to be successful.

Like what is the thing of value that you're going to create? Right. How do you find out if people want it? That kind of stuff. Yeah. So that's interesting. So I love the description. I think that there's a lot of work to be done to [00:04:00] figure out how to do it though.

[00:04:01] Steve: Exactly. And, and that's all on the road between where you have the idea of like, I'm really good at this thing and I think people might pay me for this between there and hey, people are paying me for this and it's easy or fun or repeatable or it's running on autopilot even and now customers are getting value, we're getting paid, all that.

[00:04:24] Tyler: Yeah.

[00:04:25] Steve: It's kind of a long road between those two things to

discover Right, yeah, yeah, yeah. To kind of figure out where all the holes are in this repeatable process.

Five interdependent processes
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[00:04:40] Steve: So, given those kind of five Characteristics, five aspects of the of the process. He then goes on to break it down into five interdependent processes, and they are value creation, marketing, sales, value [00:05:00] delivery, and And those map one to one to the five points we had before. So let's go through each of those.

Value creation is discovering what people need or want, discovering it, and then creating it. So this might be like, for me, uh, people need their taxes done. And so what do I have to do to To get folks from, I have a stack of documents to there's a completed tax return and the refund is in my bank account. That's kind of the thing that I'm creating for one of, one of my service lines. Then the second one here, marketing is attracting attention and building demand for what you have created. If I just sit in my house and say, I, I'm really good at doing tax returns now. Um, no, nobody's going to pay me for that unless they know that I do it

[00:05:55] Tyler: Right.

[00:05:56] Steve: and they are aware that they can hire me to do this thing and [00:06:00] that they feel confident paying me to do it.

Oh, I guess we're bumping into sales here. Uh, awareness is, is the primary thing here.

[00:06:07] Tyler: Well, marketing and sales are arguably related, or as you said, interdependent, right?

[00:06:13] Steve: Oh, that's true. Yeah. Yeah. So sales, sales is kind of, uh, you've got a prospective customer. How do you turn them into a paying customer? They're already aware of you. They're interested, but there's, there's a gap between interested and,

[00:06:32] Tyler: Okay.

[00:06:32] Steve: uh, they have paid you money.

[00:06:34] Tyler: So would, would it be fair to say that marketing is the creation of leads and sales would be turning leads into customers? Maybe that's oversimplifying it, but

[00:06:45] Steve: Uh, maybe, but I think that's a good, uh, first approximation at

[00:06:50] Tyler: I mean, if we define lead as someone who you could pretend, who is, you know, aware of and could buy your product.

[00:06:56] Steve: Uh huh. Yeah.

[00:06:58] Tyler: Anyway, that's, sorry, [00:07:00] I'm like, uh, starting to read a book right now called a hundred million dollar leads. So leads are on

[00:07:05] Steve: Oh, okay. Yeah. Yeah. So this could come from like advertising or it could come from you go to networking events and meet people, or it could come from. You have a really good relationship with a referral partner in an adjacent industry, and they send folks your way. You know, any of those things

[00:07:27] Tyler: Yeah.

[00:07:27] Steve: that can be the marketing.

And then the sales is kind of, you've got them on the phone or you, you are exchanging emails and you

[00:07:35] Tyler: Or they're in a funnel of some kind that's automated.

[00:07:38] Steve: hmm. Uh, and you're walking them through the process of here's what it's going to look like for you if you hire me to do this thing, uh, and sort of, uh,

[00:07:51] Tyler: Get their money.

[00:07:51] Steve: convincing them, I suppose, but, but in, you know, like helping them see the value of what you're providing to where it makes sense to them, [00:08:00] they want to pay for that thing.

[00:08:01] Tyler: Right. Yeah.

[00:08:05] Steve: Okay. So value creation, marketing sales. It's, and the next one is value delivery. Uh, now you've got to actually do the thing that they're paying you for. So, giving your customers what you have promised and ensuring that they are satisfied.

[00:08:21] Tyler: That's right. Yeah, I've experienced the elation of making a sale only to realize that I've got three months ahead, you know, three months of coaching ahead to, uh, earn the money basically. Right. To, to, to deliver on that value that I promised. Fortunately, I really enjoy coaching, but, but, uh, it's interesting how sales is just the beginning, especially if it's just you, right?

You got to, like you said, you got to do all this stuff as a solo entrepreneur. And so. There's no time to rest after you make the sale. You've got to immediately jump in often and start delivering.

[00:08:55] Steve: Right. So for me, this looks like, uh, they have signed the engagement [00:09:00] letter and now I've set up the client portal. They're sending me all their documents. Now I've got to start plugging all that into a tax return.

[00:09:06] Tyler: Yeah.

[00:09:07] Steve: and, and then, uh, send them a draft, make sure they're happy with it. Make sure we covered all the bases. Get it all signed, get it e filed.

[00:09:15] Tyler: know,

[00:09:16] Steve: all part of the value delivery for my business.

All right. Then the last one here is finance. Bringing in enough money to keep going and make your effort worthwhile. This. And this one, it can be really fuzzy for solo entrepreneurs because you're not paying anyone a salary and potentially not even yourself at the beginning. So is it profitable? Who knows?

Like money's coming in and things are happening like that. It looks like it's profitable. Uh, maybe it is, maybe it's not, uh, but, uh, eventually I think the idea here is if you looked down the road, five, 10 [00:10:00] years, if you were still doing the same things for these prices, are you able to, uh, take home money out of the business to support your lifestyle? And then, and the business still has sufficient assets to operate, continue operating. So whether that's, you're paying yourself a salary, or you have hired folks to do the value delivery portion of this process. Uh, whatever it might look like, but anyway, enough money to keep going.

So those are the five interdependent processes from the personal MBA.

[00:10:37] Tyler: Yeah. So Steve, like you mentioned at the beginning of the episode, this is the first episode of a new series that we're doing and what we're going to be doing actually is covering these five business processes through interviewing experts in each of them. So we're going to bring in someone for value creation, marketing, sales, value delivery, and finance, and kind of learn from their expertise and experience about the [00:11:00] topic generally.

And their expertise, and then also what it would look like to work with someone like them to scale a small business like ours using their type of services.

[00:11:09] Steve: Yeah. And there'll be some overlap between them and we'll have like specific questions for specific folks that I know are like really good at this aspect of it or, or whatever. But yeah, I'm excited for that, uh, those interviews that are coming up. I think our listeners will enjoy them.

I think we will all enjoy listening to those interviews. All of us. We're all in

this together. Everyone.

[00:11:36] Tyler: We're all in this together.

What does it look like for a soloist to do all these things?
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[00:11:40] Steve: So I got some questions that we can explore here for the last few minutes. of, um, maybe what this might look like in a different, different types of businesses or different, phases of the life cycle of a business. So for this first one, what does it [00:12:00] look like for a soloist with some particular technical expertise to start a business and do all these things?

I sort of gave the example of what I'm doing as I walked through this. Like I have. technical expertise in filing taxes. And so what that means is I go out and find folks that need tax returns, uh, cultivate relationships with referral partners, have intake calls with clients where I explain what it is that I do and how much I charge for it.

Uh, they see the value in it. They pay me, I do the tax return, all of that.

[00:12:37] Tyler: Yeah, so I can tell you a little bit about what this looks like right now in my business. Um, We've talked in the past about a book called The Prosperous Coach, which I like a lot because it's about the coaching business model. Uh, well, one of the available models for a coaching business. And although they use different terminology than these five processes that you've [00:13:00] mentioned here.

Uh, it's the same exact principles. And, uh, one of the principles from the prosperous coach is for a coach, it can be beneficial to, if you had a Venn diagram between the sales and the delivery, I'm trying to use the terminology from these processes, right? Uh, It benefits you as a coach to have the Venn diagram overlap as much as possible so that there is, that's the process of selling coaching looks basically like just delivering value through coaching.

So they've kind of like collapsed those two in on themselves with the idea that, um, if you're able to deliver value in a coaching session, people will understand the value. And so you don't really, there's not much to sell, right? There's not much selling to do other than actually just giving them the experience of coaching and the decision just becomes, do they want more of it or not?

So I think that's kind of something that I've been experimenting with, as you know, [00:14:00] and it's going quite well, actually.

[00:14:02] Steve: that's good to hear.

[00:14:03] Tyler: Marketing is still a mystery to me. Um,

[00:14:07] Steve: We were talking about that before we hit record today.

[00:14:10] Tyler: yes.

[00:14:12] Steve: Is this all just a fluke? Where these customers came from? Could that funnel dry

up

[00:14:19] Tyler: And the answer is maybe

yes, maybe yes so far, but it's fulfilling the requirements of the finance process here, which is that it's bringing in enough money to keep it, keep me interested. Right. I'm continuing to go. My effort is worthwhile. And so no reason to stop yet. Just still trying to figure it out.

[00:14:36] Steve: You know what? That's a good point on, on the finance. Uh, it doesn't have to be that your business is, uh, is going to replace your day job salary. It could just be that you're making enough money that it's still fun and enjoyable and it pays for itself and you would like to keep going. And that's okay too.

[00:14:57] Tyler: Yeah. Depending on what your goals are

for sure. exactly.[00:15:00]

And you know, I, it's almost a year into this and my goals have remained the same. Um, who knows what they'll be in the future, but you know, I've, I had no intention of replacing my day job. I kind of wanted this to be a side thing, um, and it is, but I'm happy to say that it's a side thing that yes, is paying for itself and is profitable for the first time this year.

Yay.

Um, which yeah, helps it. So yeah, but I don't. I guess I'm just agreeing with you that it's, it is what it is. It's a small side job at this point, side business, uh, but that is also fruitful and so it's worth doing, you know?

[00:15:39] Steve: Yeah. And that's the beauty of this kind of a business model is you get to decide what you want it to be. It does, it, you can, you can grow it real big. Well, we'll, we might talk about this in a second, but like, oh, uh, ways that this could scale up. Like you could decide, I want to stay solo forever. I just want this to be me.

I don't want to [00:16:00] hire employees because I don't like managing employees or I don't want the stress of payroll or whatever it might be. Uh, there's ways you can build a profitable business. That's big or small or somewhere in between. Uh, and it's just you, or you can say, I would like to build a big team because I don't want me to be the critical point on any of these workflows.

And so I would like to have employees that handle everything so that if I decide to go on vacation for a month, I can do that. And that's a, that's another valid way of growing a business. And it just depends what you want your business to be.

[00:16:43] Tyler: And that's part of what this series is going to explore, right? As we talk to professionals who specialize on each of these processes, learning about what they do and when it might make sense to hire someone like them, is that kind of the idea?

[00:16:57] Steve: Yeah, exactly.

[00:16:58] Tyler: Very cool. Oh, [00:17:00] I'm excited.

Hiring fractional help
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[00:17:03] Steve: So which aspects, uh, of these processes would you say are well suited to hiring like a fractional provider? So for example, like doing a tax return, you can do that yourself if you want

to. If you want to learn enough about how the tax code relates to your particular type of business, you can totally do that yourself.

Or you can hire somebody to do it for you.

That's a, that's a decision about what kind of thing you value., But, uh, what are some other ones? Like marketing is one that comes to mind.

[00:17:39] Tyler: yeah, this really harkens back to our episode about outsourcing. I feel like we had a great discussion about, you know, outsourcing, you know, making this, making this decision based on what you are good at. And interested in versus what maybe you're not an expert at. So yeah, marketing, definitely.

Like, I don't know. I, ever since I kind of went [00:18:00] public with my business, I've been getting a lot of cold messages from people who are offering to book my calendar, right? Like that's the service that they provide, which is like, we'll get you leads. Like we'll find people who might want to coach with you and charge you for that.

I've never really pursued any of these offers, but like it's a whole thing. And that is kind of something that I, you know. I haven't figured out, so that might be worth me exploring at some point, is the marketing piece. You know, booking my sales calls for me, having someone else do that, I mean, so that I just have a chance to just coach, coach, coach all the time and not do anything else.

[00:18:35] Steve: Yeah. Okay. And, uh, I think if you have a marketing, uh, what, engine, I guess, of like, you know, you've designed the marketing plan and a big piece of it is like content creation or posting on social media or like following up with folks that way, uh, and you kind of need that machine to run, but you don't want to have to [00:19:00] spend.

Your valuable time on that, that's something you could outsource to folks that specialize in that piece of, of running the marketing plan.

[00:19:08] Tyler: In fact, I was driving down the freeway the other day, I saw a big billboard for just that. It looked like a company who basically does content marketing for you. Like, I don't know exactly what you have to put in, because they're using your face and your content, but they're going to chop it up into TikToks and Instagram posts and, and do all that for you, it looked like.

So I thought that was kind of interesting.

[00:19:29] Steve: Okay. Yeah.

[00:19:30] Tyler: Like, if you don't want to, if you, yeah, like, I don't see myself ever, uh, being a social media marketer, it's, I don't have the energy anymore if I ever did, uh, you know, but if I wanted to, you know, there's people out there like Alex Hormozi comes to mind. He's just like a content machine.

He spends a ton of money recording content and having people edit it and make it good and put it on YouTube and all, you know, all the platforms. He's built an enormous awareness of his brand through doing that. And support, uh, you know, apparently worth it to [00:20:00] him. So

[00:20:02] Steve: Another angle here on marketing is, uh, hiring an expert to figure out what avenues would be useful. Uh, and valuable for your particular kind of business because, uh, you don't want to do social media marketing, but also maybe that's not a good avenue for finding coaching clients anyway. And so you would want somebody who knows, uh, the, the whole landscape to be able to advise you on when we're designing this plan, it doesn't make sense to include social media marketing or should we focus on other things?

[00:20:33] Tyler: Yeah. So I'll just finish. I mean, if you don't mind, I'll just kind of talk to the other of the five for my business. Cause I should've started at the beginning. I don't know why I didn't. Marketing just always sticks out to me, but for the value creation, I feel like I've made good progress there. You know, I've been through a couple of dozen clients at this point.

I'm kind of getting a feel for what people need or want and like getting better at delivering that and, and even how to articulate what it is to them. [00:21:00] I mean, that's a never ending growth opportunity, right? I'm not saying I've got it nailed down, but it's, I've come a long way there. The marketing, like I said, I'm just reliant right now on being listed in a directory, which has worked out.

So it's okay. The sales and value delivery. I talked about how I'm trying to merge those into kind of the same activity.

[00:21:20] Steve: Yeah.

[00:21:22] Tyler: Um, and then yeah, the finance, um, well, I guess I already talked about that too. Like it is generating money. The businesses got healthy finances right now, which is very validating and encouraging me, encouraging me to keep going.

[00:21:37] Steve: Yeah. Good.

[00:21:39] Tyler: And how am I doing that? I'm using YNAB, of course, what did you think I was going to say?

Just to track, track, uh, income and expenses for the business.

Yeah.

[00:21:52] Steve: to become large enough that you wanted to outsource that, you could get a bookkeeper or an [00:22:00] accountant or, uh, a, a chief financial officer, for example, someone you can hire just fractionally to, to, to give you advice, um, strategically for your finances.

[00:22:11] Tyler: Huh?

[00:22:13] Steve: Uh, those kinds of things. If, you know, if it, if you don't, If you don't have the interest or the time or the skill to do that kind of a function in house, there are folks that can do the various aspects of it

[00:22:27] Tyler: Yeah.

Yeah.

[00:22:28] Steve: so.

[00:22:29] Tyler: What about you? Do you, do you see yourself headed that direction? Like, are there parts of your business you are interested in scaling beyond yourself in the near to mid future?

[00:22:40] Steve: Um, possibly, I don't have any concrete plans to do so, but one where it would immediately make sense is on the value delivery piece of having either a bookkeeper or another tax professional that can do it. Um, uh, prepare tax returns [00:23:00] or do the books for my clients to free me up to do the, the higher level strategic things or finding new customers or, uh, that kind of stuff. Um, I don't have, uh, like I say, I don't have concrete plans there yet because I do still enjoy the technical work in the value delivery portion of this, and so I've, I, I liked that part of it.

[00:23:27] Tyler: I mean, both of us kind of started this with the idea of being solopreneurs. Right. So it's kind of interesting question.

[00:23:33] Steve: so that's about it for today. And we, and then the next episode, we'll, we'll talk to experts on each of these things of asking, like, what would it look like to scale up each of these aspects of the business, whether that is you're increasing your skills as the solopreneur and doing it all, or you. Decide that you would rather outsource that or hire [00:24:00] somebody in house to do that.

What, what all that might look like. So I'm excited for those

[00:24:04] Tyler: Cool, yeah, it's going to be some interesting perspectives.

[00:24:08] Steve: Yeah. Well, thanks Tyler. We'll see you all again on the next episode with our first guest of the series.