Today’s episode features valuable information for anyone interested in starting their own business to secure their family’s financial situation.
Buck speaks with James Schramko, a successful entrepreneur and the founder of several businesses, including superfastbusiness.com, about how and why James chose to transition from his successful day job into business ownership.
James explains the importance of having multiple income streams, and he tells us how to find the courage to venture into entrepreneurship. He explains why we need to be honest with ourselves about our strengths and weaknesses, and why we have to set goals and stay on-track.
Which platform should you use for your online business? Should you take on all the work yourself from the start, or is it feasible to outsource some tasks? Why does James keep talking about trains, and what exactly are “ninja-pinos”?
Continue on with the podcast or the transcript to find out.
Click here to learn more about James Schramko.
In Today’s Episode:
0:09 – Introduction to James Schramko
2:17 – The Australian recession’s impact onJames and his family
9:00 – How having multiple streams of income can give you financial protection
10:39 – Having the courage to take the next step
16:57 – Ninja-pinos? Outsourcing!
18:05 – James’ train analogy
20:41 – Getting to the destination
21:49 – Strong systems
24:45 – A skill called “Observation”
30:03 – The best customer is the one you already have
32:58 – Progress. Eyes on the prize.
35:11 – Best platform to start with
39:00 – Assessing yourself
41:12 – Final notes
Introduction to James Schramko
Buck: Hi, this is Buck Rizvi here with Survival Dad and the Survival Dad podcast. And with me, I’ve got Mr. James Schramko. James is the founder of superfastbusiness.com, where he helps people around the world grow their online businesses much faster.
He lives in beautiful Sydney, Australia. In fact, I used to live in Sydney, so I can say from personal experiences that it’s gorgeous there. He’s also the host of several top-rated podcasts, including Superfast Business and Freedom Ocean and a new one that he just told me about called Kicking Back, which you can check out on iTunes.
James is the father of four, and he’s taken a very interesting route to make sure that he and his family not only survive from a financial standpoint, but they flourish. We’re going to talk to him about that today and hopefully extract some of James’s secrets.
James, how’s it going?
James: It’s going well, thanks, Buck.
Buck: So, did I do you justice on intro?
James: Yeah, it sounds great. And I didn’t even send that to you in advance. It’s wonderful. It’s very kind.
Buck: I wanted to make you work less — this is all about outsourcing, right?
James: [Laughs] Yeah, this is just a conversation, right?
Buck: So we were just having a little bit of banter here, and you were mentioning that you’re going to go hit the beach after this and do a little surfing.
James: Yeah, I actually plan my discussions and work activities around the tide charts these days.
Buck: Nice. Okay. So this is… it is the wintertime there, and August I think is the last month of winter, and so what’s the average temps around this time of year?
James: So, we’re seeing a daily temperature of around 16°C to 20°C in Sydney, and the water temperature is about 18°, which is not dissimilar to summer in California, by the way.
Buck: Okay, yeah, I think the ranges are somewhere in the low 70s for us — Fahrenheit, for us Americans. So sounds good. Well, why don’t we jump into it. I’ve got a few questions I know the folks are really interested in hearing what you have to say, and I know my intro really did not do you justice coz you’ve lived an amazing amount of life for such a young man your… Have you hit 40 yet?
James: I’m now 43, but I feel like I’m about 30.
The Australian recession’s impact on James and his family
Buck: Okay. Well, good. Well, you look like you’re 30. I will be sharing your picture with everyone.
You have a really interesting origin story: I know that as a young man you’ve done everything from working in a lumber yard — I think you call it a timber yard — and digging swimming pools by hand, to running a lawn-mowing business. So you’re no stranger to manual labor, I know that.
But I know that something happened to your family, I think you were about 20, that had a profound impact on you. This is the Survival Dad show, do you mind sharing what that did to your Dad, and how that shaped you as a son?
James: Well, if the summary is that we grew up quite wealthy, in a wealthy suburb. I went to a top-level school. My dad had a high-flying job in property developments, had a Jaguar, a car phone, which was pretty rare in 1987. By the time 1991 came around, I was about 20.
James: And there was a financial crash, and he got terminated from his job. His car was not worth what the loan was on it, and the interest rate on the house was astronomical; it was twenty-something percent, and the house was worth about 700,000 back then, and the loan on it wasn’t fair because they’d renovated it. So you just went from a single-source income to nothing. And not even enough to pay back the car and the house. So they were living right to the edge of their income without this idea that it could stop.
James: So I actually had to move out. Had to move out of the house. I went to my grandparents’ place, and we built a little shed in the backyard for me to live in. So it was quite a traumatic shift from growing up with a silver spoon and wealthy, but I wasn’t… although I was spoiled, I wasn’t ignorant because my parents would take me around rural New South Wales on car trips, and we’d see less-fortunate families.
James: And my mom, who’s worked for the Red Cross and the Smith family, which is a charitable organization… So we’ve always had that humility there.
James: But it was a dramatic change for me. And at the time, I was starting a course and working on Fridays in an accounting firm, and I actually had to start buying the groceries for the family, which is…
James: And I quit my study part way through my course, so I never finished that. It was an associate diploma in accounting.
James: And I took up a job in debt collection, which was thriving right then. It was telephone debt-collection, and I had this, I remember having a huge shock that I wasn’t going to be a millionaire unless I work for it. Because up until that point, I figured I could goof off…
Buck: Dad’s loaded.
James: And I didn’t really understand, at the time, that people don’t actually own their cars and houses.
James: Didn’t really understand mortgages and debt until I worked for the debt-collection firm. And it was astounding; I had to phone people up and ask them for money to pay back things they borrowed. I didn’t realize how many people borrowed everything — even from servicing their car they had credit accounts.
James: Like, not just the car, but even the servicing of it. And I realize, Hang on, most people don’t own anything; the banks own all of this.
Buck: So it’s the attitude of “the music is never gonna stop.” I know I’ve had that as a younger man. Sounds like your dad had a bit of that as well.
Jeff: It stopped. It was a slap in the face, and he didn’t recover well from that. He ended up… My grandparents passed away; my parents got an inheritance from that. My Dad bought some travel agencies, and he got two travel agencies. He expanded to three, shrunk back to two, and ended up bailing out a few years later by the skin of his pants.
He wasn’t good at running a small retail business after being a property developer and high-flyer. He used to do massive, multimillion-dollar deals, you know, it’s just very different going to a retail storefront.
James: And, of course, the travel industry got hit very hard by the….
Buck: Online… [Laughs]
James: Innovations [laughs], we call the internet. Just the timing was shocking.
James: With just… you got into a business that was getting taken over by the Internet, and the margins were getting smaller, and he wasn’t experienced in the industry. So…
Buck: So he wasn’t ready and he couldn’t adapt, it sounded like.
James: Couldn’t adapt, and he ended up doing handyman work, like repair work.
Buck: Oh, wow.
James: And now, he’s… Basically, my parents sold up out of Sydney, went up to the coast. They have a house up there, and my Mom does funeral celebrant stuff, and my Dad sort of hangs around at home, and he still gets a little bit depressed.
James: It’s sad to see. He looks a little older than his physical age. And I learned a lot about how I’m different to him through that experience, and they gave me a better upbringing than what his parents were able to give him. And I think a lot of his emotions carry on from when he was a child because he was number four of four kids. And all the kids before him got put through school, and they didn’t have enough money for him, so he had to earn it on a scholarship.
And then after school, he went to university. And after university, he worked pretty much seven days a week as a chemical engineer, and he worked so hard all the way through and then just got dumped on his backside at the peak of his career. He went to the plummet of his career right there, and the embarrassment of having a couple of kids and wife witnessing this would’ve been a big burden.
Buck: I think you… I saw one of your presentations where you talked about where we’re all kind of walking around with umbilical cords that we want to plug into the next job, and we’re assuming that someone’s going to take care of us, and, you know, I can speak from experience having been laid off before as a younger man that that is, you know, it’s a shock, it’s a shock to the system.
James: The fear of being laid off for me was so great because of that experience, that I was an overachiever at work.
How having multiple streams of income can give you financial protection
James: I was always making sure I wasn’t going to be the one sacked. To me, that would’ve been a hideous embarrassment.
Buck: Right. Well, we are the product of our upbringing and our environment, so it shaped who you were, and I think that’s to the better, right? Would you — and I know this is almost a rhetorical question, but I would like to hear your opinion — would you say it’s an imperative to have a stream or streams of income outside of your day job? If you want to have a day job?
James: I think I’ve demonstrated to myself and others that most people feel that a job is secure and safe. It’s probably the least secure and safe thing you could ever do. Getting paid by [just] one person is not smart, and if that person doesn’t like you, or that business model doesn’t work, even through no fault of your own, you can be made redundant. And it seems to me that most people have very bad ideas around money and money management, and they tend to borrow and mortgage against their income, and they have no control over that.
James: If the income stops, then the whole merry-go-round stops, and that can be catastrophic. So, as a result of what happened to me — and through educating myself through reading good books about it and being very interested in how I can protect myself from that — I decided I’d rather get paid by thousands of people; I’d rather operate in several markets.
James: I get paid through different payment methods. And I have no debt — I haven’t had debt for maybe five years.
Having the courage to take the next step
Buck: You have a portfolio theory of income. That’s amazing. I remember you saying you left the job managing a large business. I think it’s a 100-million-dollar business. You’re making 300 K a year. You had a transition point, right? Where you decided, “Now’s the time, I’m ready to make the leap.” What gave you the courage to make that leap?
James: Well, the second-last job I had I worked for an absolute lunatic. And that was a 100–million-business. And he and his business partner had the biggest falling out, and it destroyed their relationship. I got sandwiched in the middle of it, and I had to bail out of that job. One of them hated me, the other one loved me.
James: And you wouldn’t believe the reason he hated me: He hated me because I had too much talent. That’s his words. I had too much talent. I was constantly showing him up, like, the employees loved me and hated him. They feared and loathed him, but they respected and admired me. And he couldn’t deal with that. And, anyways, so I moved on to the second, to the last job, and that was about half the size, about 50 million dollars a year.
James: That business — and I was certain at this point my affiliate income — was starting to increase. My online interests were working, and I met people like you, funny enough. You come into the story. I met you when I still had a job.
Buck: Oh, that was 2000. I think it was 2008. Yes.
James: I met you and a bunch of other people like you who were doing some pretty amazing stuff that really shaped my expectation of myself. I actually came to the conclusion that I was ripping myself off — easily 300,000 a year, when some of these people are making, you know, a 100,000 dollars a month or more. Some guy reportedly made that in a day every now and then. So it just made me set the benchmark differently, and it really shook me around. And within six weeks, I went back and restructured my online business to double it and quit my job. And it was the most frightening thing that I’ve done, but it was also the biggest relief.
And about nine months later, I was up at Queensland, another state in Australia, at a presentation. I was doing this thing in the World Internet Event where there were 550 people. And I was in my room rehearsing, and I just sat and I just thought this the second time: I can’t be sacked. I can’t suffer the indignation and pride assaults of being sacked because I’m now the master of my own ship.
Buck: That was such a beautiful thing.
James: And that’s something that I fought for.
Buck: And so, just to rewind a bit, the subtext of this was that you had started working on something on the side, generating affiliate income while you work your day job. Is the right?
James: Yes. And as part of my day, overseeing the entire Mercedes-Benz dealership. I was in charge of the marketing departments, and that involves the website, and online marketing was something I was experimenting with. I was learning about it at night and then implementing stuff from the company’s website during the day, and testing all these things about capturing email addresses and driving Google AdWords to landing pages.
Buck: So it’s a win-win and making one of the partners hate you even more coz you were doing so well with it.
James: Well, the owner of this business was pretty easy-going compared to the one before. And I guess you would almost classify him as absent. I was pretty much left to my own devices but without any budget to do anything either coz the business wasn’t making any profit when I started.
So I was in charge of this huge machine that was unprofitable, and I had to do a serious amount of re-engineering over the last… took me about two years to turn it from minus one-point-something million dollars in loss per year to a positive 700,000 in profit. Took me three years, and a lot of things had to happen for that to work out. But then I figured, well, if I can do this for someone else’s business, perhaps I can apply this to my own business.
Buck: Well, I had no idea that you had that epiphany right around the time that we met, so I’ll take full credit for that, James, thank you very much. [Laughs]
James: [Laughs] You might as well, it’s not like I’m here to fight you off.
Buck: Yeah, exactly. So you went from one big office, you know, where you’re going to the office working with a bunch of people, loads of employees. Did you just trade that to go into another big office, now it’s your office with employees and all the, you know, drama that goes along with that?
James: [Laughs] No, I traded that. So it’s going into this huge Mercedes-Benz showroom, and I had my own personal assistant and 70-something staff to… I traded that for a desk in my spare room at my house and the employee-ship of one. And I had a part-time help guy around at that time who was in the U.S. answering a few support tickets. That was it.
James: And it was quite a shock. Being a general manager in a nice suit, driving a very expensive car, and being able to set up systems and have everyone else do the work.
James: Now I was the person doing all the work. It was me, just me. I had very limited capacity, and I actually had some false assumptions too. I figured that I didn’t want to structure, I didn’t want to routine, I didn’t want staff. I definitely didn’t want an offer, so I didn’t want stock. There was a lot of things…
Buck: By stock you mean inventory in some warehouse somewhere, yeah?
James: Yeah. I didn’t want a physical product. Now, since then, I’ve definitely changed my stance on routine and staff. But I’ve still got a digital business.
Buck: You have something called the so-called “ninja-preneurs” or “ninja-pinos.” Is that a derogatory term? I’m still trying to figure out what that means, but maybe you can share that with me? [Laughs]
James: It just refers to my team in the Philippines. They’re so good. They]re ninja-good, so we just call them “ninja-pinos,” like ninja Filipinos.
Buck: Right, and that is, and I know you don’t like the word, outsourcing, but they’re your team, right? That’s your team?
James: That’s my team. They’re exactly like the team I had at the Mercedes dealership, except they just happened to be in a different country.
Buck: And so they don’t come to your home. You manage them remotely, and it sounds like they work pretty autonomously?
James: They all work from their own home. And I work from wherever I am, at home or wherever; I don’t have a physical office. There is no Australian staff. And basically, they’re two to three hours behind me in their time zone, which is perfect.
Buck: You have a huge advantage being in Australia, let me say. [Laughs]
James: Massive advantage. And I’m aware of that. It’s a struggle for people in other markets to use the Philippines the way that I do.
James’ train analogy
Buck: Mm-hmm. So you talked a bit about, in the past about this, the analogy, the train-station analogy, where people, you know, you must’ve had a vision of where you were headed when you made that leap and decided that, “Hey, I’m tired of doing this for someone else. I’m going to do it for myself. Now I’ve got the business systems in place to make that happen.” You’ve talked about this in the past, about a train station. All we need to do is pick the destination. What do you mean by that?
James: Yes, so basically you… Like a lot of people that are rambling through business without any idea where they’re supposed to be going, and I learned this from the lunatic actually. It’s… you walk down the line to where you want to go, where you’re actually going. What’s the whole point? Heuers used to say, “What’s the point?” That was probably his favorite phrase is “what’s the point of this.”.\
James: And it forces you to think, “Well, what is the point? Where do I want to go with this? What am I hoping to achieve?”
So the metaphor is we go to the station, right, we vision the platform on the station where the train is pulling up. We get out of the train. We’re here at the station, is this where we want to be? When we get there, will we be happy with this destination? Was there a point to this”
If so, then what we do is we just mentally walk back down the tracks to where we are now in the train, and we get in the train, and we start shoveling coal. And because the tracks are in place, there is no loss of energy going left or right or thinking about “Where?” We know where we’re going. It’s a fare to complete.
Buck: Is it freeing in some way to know where you’re going?
James: It gives you the ability to make good decisions. It puts barriers to disruptions. So if someone comes along, which is very common with entrepreneurs, if someone calls you up and says, “Hey Buck, I got this greatest opportunity. I just had dinner with this guy. Da da da da da… He wants to make you an 80% partner, you just do the…” You say, “Well, hang on a minute, you know what? I’m currently on track to go to this particular destination right now. When I get there, let me look you up, and we’ll have a chat about it, but right now I’m very focused on what I need to be doing in my business.”
And it allows you to say “no” instead of waiver or surrender to a “yes,” to an opportunity that could take you way off track. And many people never get to the destination because either (A) they didn’t plan it in advance, or (B) they don’t have solid tracks and the willpower to shovel the coal.
Getting to the destination
Buck: Well, that was my next question: What do you think stops people from picking a destination? Let alone getting to it”
James: There’s this great expression, I can’t remember who said it, but if you don’t have a plan then chances are you’ll fall into someone else’s, and they don’t have much of a plan for you.
So, I think they are just existing, they’re just drifting. They’re just sloshing through life at the mercy of whoever’s advertising to them or directing them into their plan. That someone else has a stronger track; you’re going to get pushed under that.
Buck: So you were on someone else’s plan, like I was. Working until I was 41 before I left my full-time job.
James: Yeah, I was on someone else’s train, and it wasn’t heading anywhere I felt I wanted to go. [Laughs]. And even worse, someone in the U.S. thought it was a great idea to fudge a few lines and cause the economic collapse.
Buck: Yes, yes.
James: In, what, 2008 or so, it was starting to become apparent that this was not going to escape a little bit of global attention.
Buck: Those yanks, you know, you got to leave it to them right? [Laughs]
James: So basically, being in the luxury car segment, in the highest possible paid role in a company that was running itself, where I made it profitable. I pretty much replaced myself and made myself redundant. And I felt that I was at risk of losing my job, not through any fault of my own but because it would be a logical thing for the owner to do at some point.
Buck: Right. You were too good. [Laughs]
James: So I saved a good chunk of cash, and I tell you what, just to back up my theory there, the management team that I left in place in 2008 are still there. The core team is still the same.
Buck: Wow. Your systems were that good.
James: They were very strong systems. I documented them all; I’ve put a lot of thought into them. I teach them to my students now. We had this one page, which was called a write-up sheet, and it had six questions that you needed to ask in order to make a sale of a car. If you ask these six questions, the chances of a sale would dramatically go up, and that was the system that I could teach people. Just like McDonald’s, that if they follow the system they would have a very good chance of making a sale because it took out the rough edges, and it reduced the possibility of a mistake or forgetting something.
Buck: Yeah, that’s amazing. You could systematically predict that if they missed one of the questions that they would reduce their chances.
James: I could look at the ratios on any salesperson and tell you who’s burning leads, and who’s a high performer.
Buck: Sure. [Laughs] The leads are never weak, right James? [Laughs]
James: Well, you know, bad salesmen always say how the market’s terrible, or this model sucks. The good salesperson is always going to sell.
James: And I actually had that theory. I’m not sure if you know that at some point in my first year of selling ever, I was actually at BMW. I was the number one BMW salesperson in the entire country.
Buck: I saw that, I was just… I was looking for a reason not to let you brag again about some accomplishment that you’ve made. [Laughs]
James: I want to make a point there, it’s not about that. The point is that there were only five people in that dealership, and I could outsell the other four. So my sales were exceeded the total of the other four combined, and my theory was about market share: That as long as someone’s buying them, I’ll just be the one to sell them.
And I didn’t let external factors tell me lies. I believed in my own ability, and I was able to logically work out, “Well, as long as the cars are going to be available in this market, I’ll just increase my market share.”
Buck: Mm-Hmm, why not? So, you made a point in another presentation I watched about you. I did a little homework on you as you can tell.
James: Yeah, definitely.
Buck: And so, what you just said about your ability to go into BMW as your first sales job, but you mentioned… coz I don’t want everybody to think that you’re, like, superhuman James. Coz you kind of are a superhero, but your background is very humble, and also you made… I think you’ve shared this before that your SATs or whatever the equivalent of SATs are —
James: Oh yeah, my high-school certificate I definitely failed. [Laughs]
Buck: Right, so there’s something else about you; it wasn’t just, you know…
James: I’m not an academic.
A skill called “observation”
Buck: I’m super academic, you’re not, so you know, anyone can do this, right? But there’s something about what you do, which I think you mentioned it, called “observation.” In survival, in some things, like for example people that do weapons training, they learn to always be aware of what’s around them. Situational awareness, right? You have something else, can you talk a little about this observational skill?
James: Yeah, when I worked for this lunatic, he would go absolutely psycho if there was something out of place. So I didn’t always have this ability; he developed it in me.
I would find myself scanning the environment before he arrived to make sure there’s nothing that would trigger his rage and anger. And he would smash things. I’ve seen him pick up a broom and smash a car to pieces in rage because there was a little chocolate wrapper on the pavement. Like, I’m talking nuts.
Buck: Oh wow. OK.
James: And so, my built-in defense for this was to scan the environment every day, like constantly, like sweep it. Look for the papers, look for a Coke can sitting on the desk. If he saw a Coke can on a desk, he’d run up to it and smash it across the entire showroom, scream at someone, and then sack someone.
So, actually… and the other thing is if someone walks into a showroom, and they’re not being served, there’s every chance it’s going to be a mystery shopper, or that it’s a setup. And you’re going to get hauled over the coals. So we used to have this notion that it was like, “Why must we train ourselves to imagine when someone walks into the showroom and starts these flashing lights and blurting sirens,” like, [siren sounds], like “customer on deck,” and you had to intercept and make sure that that customer was dealt with fairly quickly.
Buck: [Laughs]. Did the customers think that this was strange? Did they run the other way when they heard the alarm go off?
James: No, no. There was no actual alarm, but we had to imagine it.
Buck: Gotcha, alright.
James: What I’m saying is I think you can tell your mind to do things.
Buck: How can people use this without it feeling creepy? How would you apply this to, you know — let’s say, someone listening right now, they’ve got a job, they’re trying to… they want to make sure they’re looking for opportunities, right?
James: Yeah, so customer walks in, you just observe them, and simply just acknowledge them is usually enough. It’s like, just if they look across at you, and you look at them just give them a little, sort of a, nod, like “Hey, I see you there.” It’s just that people want to be acknowledged, that when people go shopping they’re expecting to get ripped off or mistreated or ignored. They’re looking for that.
Buck: Right. They’re expecting bad service, right?
James: Yeah, they want to have a great story for the dinner party that night: “I went into the Mercedes dealership in my shorts and flip-flops, and they ignored me, and then I walked out, and I went to the Porsche dealer next door, and I bought a turbo, and then I drove back to the Mercedes dealer, looked in the window and honked, and then drove off. You know, I’ve heard that story like a hundred times, it’s such a cliché.
Buck: Well, sure, I live in Boulder, Colorado, and I walk around in shorts and T-shirt all the time. So you never know who you’re going to run into.
James: Yeah, and I don’t wear shoes the majority — I’m bare feet right now, like I’m in a T-shirt. But when I go to a shop I’m super aware of what’s going on. Who’s where, who’s ordered what, being looked after, what they’re interested in.
Back to your example: You can observe the person walk in, and you see what they’re most interested in, like, where do they walk, are they looking for a sign, do they walk up to the paint aisle, do they go to the muffin counter. What’s their primary interest.
And then after, you don’t want to be, like, creepy, like instantly jumping out at them, but in a fairly reasonable time frame, you might pop over and ask if someone is looking after them. It’s much better than, “Do you need help?” or “Can I help you?” Coz you’re always going to get a “no” for that. But if you ask, “Is someone looking after you?” — now I have to say “yes” or “no.”
Buck: That’s actually interesting the way you phrase that. It’s almost like one of the six questions you would have the sales rep ask.
James: Right. So if someone comes over and asks, “Is someone looking after you?” and you say “no,” that’s pretty much like, “Well OK, well, you can start looking after me now.”
Buck: Right. [Laughs]
James: If they say “no,” say “Oh great, well, do you need a hand with this paint thing? Is there a particular color you’re looking for?” Basically, just continue on as if you’ve been talking to them all day.
Buck: It’s disarming. It really is because it’s not the standard…
James: Well, you’re implying that you care about them.
The best customer is the one you already have
Buck: Mm-Hmm. Exactly. I’ve heard you say your best customer is the one you already have.
Buck: So it’s sort of tied, sort of related, to what we’re talking about here. How has that served you over your career, and, you know, what would it mean in terms of a, let’s say, a noobie’s attitude, people listening to this podcast care about making money online?
James: Most people have this hunter mentality; they’re out trying to spear the next kill to eat today. And they’re desperate, and once they’ve done that then they have to do it all over again.
I prefer to plant seeds and grow crops, which I can continually harvest like an orchard. You know, you look after your apple tree, you can keep picking it, and it will feed you for a long time. So 90% of my business is repeat customers.
I focus far more on my existing customers than getting new ones because if I focus on the ones I’ve got, they keep buying, and they’re very happy — I build great relationships, and they’re much easier to deal with. It gets to a moment your business level doubles, so [they] give you more concessions than a brand-new customer because they know you.
Buck: Okay. Yup.
James: It builds up trust. They buy everything you’ve got because they’re very happy. And if you wind back to, say, the car sales job, which is a typically long life cycle of two to three years, I was still selling more than half the cars to people I’d already sold cars to or referral to someone else in the family or whatever. Because it’s really hard to get someone in the car who’s not a sleazy salesman. And I was the standout for them.
Buck: So the attitude of this being the long haul and always providing value, delivering value.
James: Yes. So an example: Instead of waiting for someone to walk into the showroom, I would go up to service, and I’d see who’s got their car in for service, and then I would contact them and say, “Hey Buck, I noticed you’ve got your SL500 in for service today, and it is coming up to two years old. I’ve gone ahead and had it valued, and I’ve compared it to your payoff figure. And I’m not sure if you’re aware, but it would actually cost you 50 dollars less per month than what you are paying right now to have a brand-new one.”
James: “Would you like me to bring one out to show you?”
Buck: “I’m ready, I’m ready to go!”
James: Like, how hard is that, and that’s working with the database. This is stuff car salespeople are typically very poor at. It’s putting the effort on the existing customers; the resources are right there at your fingertips.
Every dealership has a customer base, and they service cars, and they sell parts. So the customer’s coming back over and over again. But most dealerships are siloed; the sales team don’t talk to the service team, and they don’t talk with the finance team, and they don’t talk with the parts team. And they’re all fighting each other. And I actually combine them all and said, “You know what, we actually have one customer, let’s get organized.”
Buck: Well, this is all part of your observation, right?
Progress. Eyes on the prize
Buck: Now, rewinding a little bit back coz I know you made the transition not just having your own, doing your own thing, and being on your own track, but doing it online. And I know a lot of the things you focus on now are building an online, growing an online business.
But I think the things that are holding folks back, whether it’s picking a destination or continuing on the track if you’ve picked a destination, is they say, “I don’t have time, I don’t have time to start something on the side.” How can someone find the time? How did you find the time?
James: Well, if you know which station you’re going to, you’ve got your tracks set, then it doesn’t matter if you’re moving a hundred yards — at least you’re making progress in the right direction.
So, the first thing is to set a longer timeframe than what you might be setting. People give up very early if they don’t get instant success today. They get disenchanted.
So setting a target is important. Having a reasonable expectation around how long it’s going to take is good. Like, most people focus way too short. When you think about companies — Amazon, seven years till they made a profit — that guy had his eye on the prize a long way out. He had, like, probably a 10-year goal and chipped away at it, using cheap furniture in the meantime.
Then, other things you can do — we’ve talked about one of them before we got on this course — is partitioning off the time that you want to work on your business and making sure you have time off the business. Very typical for entrepreneurs to burnout, spend too much time, be very ineffective. They start switching on cat videos on YouTube and spinning the wheels, thinking they’re spending time on the business but their not. So having effective time.
And also, if you don’t have a lot of time you can buy other people’s time.
That’s one area where my businesses have really become more effective — hiring people to do things, so that I don’t have to.
Buck: And using your “ninja-preneurs,” your “ninja-pinos,” sorry, to get more of your work done.
James: Exactly. So, if I buy 50 people’s time, then I now have a lot more capacity than me by myself.
Buck: Yup. Is there a, you know, for the folks listening, they may… I think a lot of people are feeling unsettled now more than ever and even more exposed. They’re aware that the music could stop at any time unlike the situation in ’91. You know, coz I remember that — I actually remember that recession, and I was impacted by the recession in ’91, so it’s very, very clear in my mind.
So, how would you recommend someone get started building their own online safety-net? You know, I think you mentioned using affiliate marketing when you are doing something on the side. Is that the best way to dip your toe in the water now?
Best platform to start with
James: Well, if someone has a job already, and they want to do something outside of that, then affiliate marketing is quite a good way to learn the ropes without having to be responsible for every part of it. You can plug into someone else’s sales page and delivery system and customer support. All you’re really doing is finding people and directing them to an offer.
James: And it can be a full-time business if you want to pursue that all the way. But it’s a good starting point, and it’s something you can do in your own spare time and fairly behind-the-scenes. Pretty passive.
James: You can do it with content marketing. You can do it with paid traffic. But you don’t have to be the front man for that. Ultimately, you’re going to end up with a little more profit at some point if you create your own products. And somewhere in between is a bridging step of creating your own products as bonuses for affiliate marketing. So I still do affiliate marketing now, and I do quite a lot of profit from it. But it’s really just a side thing because my customers are going to buy this stuff anyway. It’s easy for me to recommend stuff to an existing customer base.
James: So some of the big questions I’d be asking is how could they get paid from a few different people, not just one place or one product.
Buck: Diversity of income, sounds like a big theme here.
James: Yeah, but not too diverse. Like, Warren Buffett has this line of that “when you diversify with your investments it just means you don’t know anything about what you’re doing.”
Buck: [Laughs] OK.
James: Because it’s like you’re trying to place bets everywhere. So I’m saying, within a specialty or within an area of expertise, try and get a couple of different customers and one or two offers that work. So that you have some level of redundancy. Now, I took a big risk quitting my job because I was getting the bulk of… half my income was coming from one affiliate program, and the other half was coming from two separate customers as an agency model.
James: That’s one way: You build websites and do marketing services for companies, they pay you a monthly retainer.
James: Those two combined matched my income, but it was pretty dicey, and I strengthened my core after that. But now, my businesses are much more comforting to me because I have three main areas of income across multiple markets. I’m dealing in different countries and different currencies and different products and services. But all within a certain skill set, and the common element is I have the same customer.
James: Mostly, my same, core customers are buying multiple things.
Buck: That’s nice when you can have the customer be common across a number of things. That’s amazing.
James: Yeah, and I view it as a circle or wheel with slices of pie; I usually call it “chocolate wheel.” It’s really straight from the dealership: They buy stock, they buy some time, the services, and they buy money, is financed, and they buy parts.
So, well, I can do this for my own business, so I have coaching and then websites and then traffic and then affiliated offers. And those things, my customers need all of those things.
Buck: Yes. Maximum leverage, it sounds like.
James: Yeah, it’s a high dollar value per customer.
James: So there’s one aspect to all this, which I think… and you mentioned fear before, you mentioned I was afraid of losing my job. But that was actually an enabler for you, right? To take action, which is interesting.
I’ve heard you talk about the habit of winning, locking away wins. Is that all about building confidence and giving you the power to go forward? What does that mean exactly?
James: Yeah, I think the things that are going to help someone be successful… Absolute honesty about where they’re at. Not telling themselves lies. Like, certainly not giving themselves limiting beliefs, but also not justifying stuff or rationalizing when they shouldn’t. When they really need to be hard-core on themselves and say, “You know what…” One way to [avoid] defeat, by the way, is to journal every day. Just write down what you did today.
Buck: Ok. Yup.
James: And be honest about it. Some people won’t be able to write down very much.
Buck: Well, if you’ve picked a destination, and you’re starting to, you know, pick the next steps that could help.
James: Measure percentage of progress, that’s what I do [when] coaching students. OK, in terms of between where you are now and the station, now, how much have we completed of this journey? 20%? 30%? 70%? That’s a way of measuring progress and keeping an eye on the target.
Buck: That’s fantastic. What is your current target, right now? I think, I know you had a target years ago from the presentation that I saw. Where are you now in your business?
James: So my target now is probably very unexpected, but it’s to work 25 hours or less per week and to surf every day.
Buck: [Laughs] You bum. [Laughs]
James: And it’s to maintain my six-figure income per month.
Buck: I’m sorry, say that again?
James: And to maintain my six-figure income per month.
Buck: Fantastic. Fantastic. Well, James, I know we… I said we’re going to do about 20 minutes, and it turned into a much longer session, but there are so many golden nuggets that came out of this session, so I appreciate you taking the extra time. So James, thank you so much for spending this extra time with us. This is amazing, I know I always learn something new when I talk to you anyway. [Laughs]
James: [Laughs] That’s like that.
Buck: How can our Survival Dad audience — how can they get in touch with you or maybe get involved with what you’re doing?
James: I would head over to wealthification.com. I think for your audience, this is a course that I put together answering a lot of the common questions I get from people trying to get this business-online stuff sorted out.
James: And it’s 100% free.
Buck: Great, and just a full disclosure: I don’t get anything out of this. So everyone that, you know, I would absolutely… I listen to James. I take James’ advice, and I learn something new every time I talk to James.
So head over to wealthification.com. And if that’s too much of a mouthful, I’ll also have a link to that at survivaldad.com/james. So you can find it there or go directly to wealthification.com. So James. I know I’m holding up the fun on the surf. [Laughs]
James: Yes. Biggest decision is what board to take out.
Buck: Fantastic. Such a tough life. Well, thank you again, Sir. I really appreciate it, and hopefully we’ll have you back again on the show sometime soon.
James: I’d love to do that, thanks, Buck.
Buck: Thanks, James.