3 Things You Need To Outperform 99% Of Entrepreneurs

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3 Things You Need To Outperform 99% Of Entrepreneurs

Top traits founders should take from Dana White (00:00:00)

  • Dana White, the founder of the UFC, is an exceptional entrepreneur known for his strong will, decisive action, and challenging conventional norms.
  • While companies like YouTube and Google emerged as a result of technological advancements, companies like Tesla and SpaceX owe their existence to the vision and determination of their founders.
  • The UFC's success is attributed to Dana White's leadership and perseverance, as it faced numerous challenges and nearly went out of business before becoming a billion-dollar enterprise.
  • Dana White's close relationship with Donald Trump stems from his efforts to secure venues for UFC events.
  • White believes that fighters are passionate individuals who find fulfillment in their profession, and that depriving them of fighting would be detrimental to their well-being.

1 - Brute force (00:05:35)

  • Force of will is a key trait of successful founders, exemplified by Dana White's quick decision-making and action-taking during challenges like the COVID-19 pandemic.
  • White's ability to adapt and innovate, such as creating Fight Island, demonstrates his resilience and tolerance for stress.
  • The greatest founders and CEOs can cut through distractions and focus on what's important.
  • Copywriting is a valuable skill that can transform your business career.
  • Sean and I have created a comprehensive document summarizing our copywriting tips, techniques, and frameworks.

2 - Extreme bias for action (00:10:21)

  • Elon Musk demanded a six-week turnaround for a task estimated to take six months, demonstrating his determination and urgency.
  • Musk challenged default assumptions and timelines, pushing his team to think critically and find faster solutions.
  • Former colleague EMT rigorously questioned plans and assumptions, ensuring well-reasoned and efficient decisions.
  • Team members became more prepared, focused, and detail-oriented in their presentations, knowing their logic would be scrutinized.
  • Steve Jobs prioritized the truth above all else and expected the same from others, even if it meant being direct and honest.

Quick audit of Dana White's gambling claims (00:14:55)

  • Dana White claims to be up $17 million against Caesar's Palace playing baccarat and blackjack.
  • He says he has only lost twice this year, but his math doesn't add up.
  • He portrays himself as a skilled gambler, but baccarat and blackjack are games of chance where the odds are against the player.
  • Professional blackjack players are considered the biggest losers in the world because they are skilled at a game that is stacked against them.
  • Be willing to go to war. Dana White thrives on the challenge and competition of gambling, even when the odds are against him.
  • Have a clear goal and be willing to walk away when you reach it. Dana White has a rule that he walks away when he wins a million dollars or loses six million.
  • Don't be afraid to take risks. Dana White is willing to bet big and take risks, even when it means risking losing a lot of money.

3 - Speed (00:18:00)

  • Force of will bias to action and speed are essential for outperforming others.
  • Dana White, the president of the UFC, exemplifies this by starting work early and expecting the same from his employees.
  • The head of PR for the UFC works tirelessly, often accompanying White to press conferences that take place at 2 a.m. in New York time, followed by another press conference in France on Monday.

Checklist for a perfect niche event business (00:19:00)

  • Jesse Itzler and others started 29029, an outdoor race where participants run up and down a hill to reach the equivalent of Mount Everest's height.
  • The event has seven events per year, with each event limited to 300 people.
  • In 2023, all events sold out in four minutes, generating $13 million in ticket sales.
  • The business offers accommodations, including Fairmont hotels and glamping, as part of the event package.
  • Despite the impact of COVID-19 in 2020, the business has recovered and is thriving.
  • The event's success is attributed to several factors:
    • Storytelling: Creating an exciting and unique experience that people want to share with their friends.
    • Challenge: Setting a challenging but achievable goal, with a 70-75% success rate.
    • Skill acquisition: Participants learn a new skill or improve their fitness during the event.
    • Beautiful locations: The events take place in scenic and visually appealing locations.
  • Storytelling: Create an exciting and unique experience that people want to share with their friends.
  • Challenge: Set a challenging but achievable goal.
  • Skill acquisition: Participants learn a new skill or improve their fitness during the event.
  • Beautiful locations: The events take place in scenic and visually appealing locations.

IDEA: The Beer Mile (00:22:56)

  • Combine fitness and drinking to create a fun and profitable business model.
  • The Beer Mile: run a mile while chugging four beers at designated intervals.
  • The Paddle Prison Break: a paddle boat race from Alcatraz to the coast of San Francisco.
  • The Beer Marathon: a half marathon with 13 beers or a quarter marathon with six beers.

IDEA: Paddle Prison Break (00:24:45)

  • Paddle Prison Break: a race where participants start in handcuffs and must paddle from Alcatraz to the coast of San Francisco.
  • Incorporate a swim race element for added challenge.
  • Require participants to have a criminal record for authenticity.

IDEA: Skyline Scramble (00:25:47)

  • The speaker discusses the concept of experiential businesses and their fulfilling nature compared to solely operating online.
  • The speaker suggests unconventional business ideas for unique experiences, such as a race through NYC without touching the ground and a citywide game of Red Rover in Boston.
  • The speaker emphasizes the importance of creating memorable experiences in the fitness industry, similar to the concept of viral food.
  • "Wander.com" is offering a special deal where listeners can enter a giveaway for a luxury vacation and receive a discount on their next booking.
  • The speaker expresses fascination with the high-quality photos on "wander.com" and how they influence travel decisions, leading to unexpected vacation choices.

Growth vs EBITDA vs cash flow (00:30:17)

  • When running a business, there is usually a priority order among growth, EBITDA, and cash flow.
  • The Hustle initially focused on revenue growth, then cash flow, and lastly profit.
  • An example is given using a $1,200 annual subscription:
    • Cash flow was $1,200 when received in June.
    • Revenue was only $100 per month the customer stayed, due to accounting principles.
    • Profit was $25 per customer after deducting $75 production cost.

Shaan's Guide to Increase EBITDA (00:32:27)

  • Shaan's business experienced rapid growth over four years, with revenue increasing by 50-100% annually.
  • Despite the growth, no personal income was taken from the business, as everything was reinvested.
  • In one year, the business broke even despite generating eight figures in revenue.
  • The cash position remained steady, but inventory assets increased, tying up cash.

Step 1: Create an EBITDA budget (00:34:19)

  • Determine the right EBITDA target by talking to people in the same industry.
  • Create an EBITDA budget by allocating revenue to different categories like overheads, cost of goods sold, and marketing.
  • Identify areas where you can find extra profit margin.

Step 2: Communicate the plan relentlessly (00:37:08)

  • Communicate the new priority of focusing on EBITDA growth to the company leaders.
  • Ask department leaders to find ways to increase their margin and create a plan to achieve it.

Step 3: Track and report (00:37:48)

  • Create a report that tracks the progress of the EBITDA improvement plan.
  • Review the report regularly (weekly or monthly) to monitor progress and make adjustments as needed.

Step 4: Tie into incentives (00:38:04)

  • Align incentives to achieve specific goals.
  • Example: Tying CMO's bonus to eida (earnings before interest, depreciation, and amortization) targets.

Step 5: Repeat every 30 days (00:38:30)

  • Regularly review and optimize expenses.
  • Conduct "spring cleaning" to identify and cut unnecessary costs.
  • Repeat the process every month or two to continuously find areas for improvement.

Next stage: Cash flow (00:40:02)

  • After improving eida, focus on optimizing cash flow.
  • Identify where cash is tied up, such as in inventory.
  • Implement strategies to ensure that profit results in free cash flow.
  • Balancing growth, profit, and cash flow is crucial for a successful business.

The benefit of playing on Hard Mode (00:41:28)

  • Playing on hard mode has disadvantages and is not a voluntary choice.
  • If you ever get to play an easier game, you will dominate.
  • Example: Someone who played college tennis is naturally good at pickleball.
  • Example: Andrew and Chris from Tiny ran agencies (hard mode) before e-commerce (easier mode) and were able to significantly increase margins.

Is e-commerce dead? (00:43:38)

  • Retailers taking advantage of the TikTok flywheel are winning in e-commerce.
  • TikTok flywheel: creating content on TikTok (self or via affiliates/UGC creators) to drive traffic to online stores (TikTok shops, Amazon, DDC shops).
  • This flywheel is effective for certain categories, not just those targeting young people.

Shaan's $30M dollar dream house (00:44:54)

  • The house is 11,000 square feet with an estimated market value of $23 million.
  • It has stunning views of the Golden Gate Bridge and the ocean.
  • There's an infinity pool that spills over into the Pacific Ocean.
  • It has a wine cellar bigger than the speaker's childhood bedroom.
  • There's a home theater and a half-court basketball court with floor-to-ceiling windows overlooking the Golden Gate Bridge.
  • The house has a 25-foot ceiling with glass windows facing the ocean.
  • It was previously owned by Sharon Stone and a dentist.
  • The speaker needs $28 million to buy the house and plans to borrow the remaining $2 million.
  • Maintenance, taxes, and insurance costs are estimated to be at least half a million dollars per year.

Shaan writes an essay (00:47:56)

  • Shaan enjoys writing essays as a creative outlet and to share his insights.
  • The act of having to deliver something regularly, such as a podcast, creates a feedback loop that encourages continuous learning and the search for interesting topics.
  • Writing essays allows Shaan to explore his curiosity and make connections between different ideas.
  • Shaan's unpublished essay, titled "Painted Chickens," will be published on his website, sean.com.

Sexier core principles (00:49:43)

  • Chipotle is facing criticism for skimping on food portions, leading to a decline in taste and customer satisfaction.
  • A former Chipotle executive revealed that the company changed its supply chain after facing E. coli scares, resulting in less fresh and flavorful ingredients.
  • The company reduced the number of suppliers and shifted to mass production, compromising the taste of the food.
  • A company's values should be genuine and meaningful, not just lip service.
  • Memorable company values are often catchy and provocative, making them more likely to be remembered and used by employees.
  • True values require sacrifice and are not free.
  • Prioritizing speed without accepting the risk of making mistakes leads to ineffective values.
  • Nike's slogan "Just Do It" exemplifies the idea that true values imply a cost and require overcoming discomfort.
  • A company's culture is best reflected in how employees behave when the boss is not around.

Culture: What people do when the boss isn't around (01:00:53)

  • To differentiate your company, select a defining characteristic that sets it apart from competitors in your industry.
  • Ensure that your company's mission and values are realistic and acknowledge the costs and trade-offs involved in achieving them.
  • Maintain consistency between your company's values and mission across all customer touchpoints.
  • The speaker discusses the concept of brand congruence and its rarity in effective implementation.
  • The speaker admires a high-end brand that aligns with their values, even if it may not match their personal style.
  • The speaker recognizes the significant impact of language on their life, such as changing "heavy dinners" to "light suppers" to improve their diet.

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