Join me on the latest episode of "Building Billions with Brandon Dawson" as I delve into the world of SaaS and entrepreneurship with my esteemed guest, Dan Martell. Known for his expertise in the SaaS industry, Dan Martell has built and scaled multiple successful businesses, making him a prominent figure in the startup world.
In this insightful conversation, I sit down with Dan to uncover the secrets behind his remarkable success. Together, we explore the strategies, challenges, and pivotal moments that shaped Martell's journey from startup founder to renowned business coach and speaker.
Listeners will gain valuable insights into effective business scaling, SaaS growth tactics, and the mindset required to navigate the intricate landscape of entrepreneurship. From fostering a strong company culture to implementing effective marketing strategies, Martell shares practical advice and invaluable lessons for aspiring and seasoned entrepreneurs alike.
Tune in to "Building Billions with Brandon Dawson" for an inspiring and informative discussion that will equip you with the tools and knowledge needed to thrive in the competitive world of business scaling.
Everybody it's Brandon Dawson. Welcome back to another episode of Building Billions. I have Dan here with me. This is going to be a great episode, a great podcast, a great YouTube video. However you're hearing it, however you're seeing it, it's going to be great. Nothing like getting entrepreneurs forward thinking. Experts in their space together to talk about how to create, how to build, and eventually how to exit. And I know that's a topic everybody's interested in. So I'm going to introduce my my companion here, my buddy Dan. He's going to tell you who he is, what he does and why we're chatting today. Dan yeah.
Brandon. Dude, as I was saying before we get on like I am a huge admirer of the work, your pedigree, your history, the collaboration, Cardone ventures, what you've built. So I appreciate the time. Most people know me as a software guy. So I built one of the largest software coaching organization called SAS Academy. So we have over 1000 clients that we coach. I've built and exited three software companies started when I was 17. Fun story that literally software and learning to code saved my life. You know, I was an addict. Ended up in prison twice by Thomas 17 and then learning to write software became my new obsession. And then this year I wrote a book, Buy Back Your Time, that.
Yeah. Congratulations. That's right here. It's sitting here. Everybody should check it out a copy.
It's literally selling more copies week over week. It's. And the reason why I think, Brandon, you'd appreciate this, because I see the team you invest in buying back your time. Like a lot of entrepreneurs struggle with this. And I know you help people with that. And it's just been such a critical part of my life to be able to do what I do. And then today I not only have SAS Academy, but I also run $100 million holding company where we buy software companies. So we bought three companies in the last four months. Wow. Yeah. So having a lot of fun. So we can talk about equity capital stacks, you name it. I can go there because that's kind of what I do all day. Yeah.
Well you know we're very interested a little a little sidebar, we are launching Cartoon Equity Group, which is going to be the business acquisition side to complement Cartoon Capital. And and so part of it's going to be venture part of it. It's going to be basically equity. Yeah. Like a fund. Some will be debt. Yeah. But it'd be interesting to talk to you about some some JV stuff because we're I'm a huge tech fan because you can't scale a business without it. In fact, we'll just jump in and start talking about our different experiences. So so let's go to your first business. What kind of tech did you build there.
The first company. So I always ask people like, you know, what was the first business, which would be the business that made it money? Versus how many domains have you bought for projects? Right. So like the first thing that ever made me money was a company called Maritime Vacations. So I grew up in Canada on the East Coast, even though I spent most of my time in the US. And essentially my dad had a cottage and this is 1998, and he wanted a web page because he was sick of answering the same 14 questions when they called, you know, do you accept pets? Is it available these dates? So I told him it cost 200 bucks to to code him a web page, which wasn't true. I mean, it didn't cost me anything. I could have hosted it for free, but I wanted to get a server. So like, I needed the money to pay for like a server that would run the code, this application server back in the day. And so I stayed up till two three in the morning for, I don't know, five, six weeks building this, this website, I built on this programming language. A lot of people wouldn't care. But cold fusion, nobody's heard of it today, but it was actually a pretty cool programming language. So I build this thing, launch it. I got my dad on there, I got no customers, and I'm like, you know, I'm an introverted tech nerd that love to code. And I was talking to my buddy Dave one day and I was like, you know, I built this thing, I need customers. And he was a burnout. And I remember he says to me, he goes, well, who are the customer? I said, anybody with a cottage or a bed and breakfast? And he goes, yo, dude, I think there's like a magazine for those kind of people. And I'm like, what are you talking about, Dave? He's like, there's literally a tourism magazine and they're all listed. And I was like, where? And I even finished talking to I like left to find the tourism office. And there's literally a magazine that they give to the people, you know, the info centers, when you come into a city, they back in the day 98, they had these things that you'd pick up. And if you wanted to go to a city and stay in there or a bed and breakfast. So I sat there and had my little brother Moe. He was about five years younger than me. I paid him like three bucks an hour to type in all the addresses in a Microsoft access database. And then I open up Microsoft word, and I did this thing called the Mail Merge. Essentially today, it'd be like a form letter. I didn't know. I'm not a copywriter. I'm a freaking tech nerd. And I just essentially the letter said, if you want a page for your bed and breakfast, then fill out this form and and for 30 bucks you'll get a page, I'll send you the link. And if you include photos, you know you want them back at an extra five bucks for like, shipping. So it's like literally this is before internet. You couldn't even upload it. And I send out, oh, probably 400. Of these letters in the mail. And I remember, you know, like a week later, we come back to our apartment with my dad, and he gets the mail out and there's like 17 envelopes with my name on it. And I grew up, you know, I had a little chaos growing up. Got in trouble with the law. And he. He just looks at me. He goes, what did you do? And we go into the kitchen and we start opening up these letters. And it's literally, you know, hundreds of dollars of people filling out this letter form and putting $30 in cash in the mail, like nobody would do that today. But this is so I always joke with people, if you've ever built something and put it on the internet and somebody buys from you that isn't your relative or your best friend, like that's the first day you get a dollar, you've gone pro because it is just it's kind of a cool experience. Like that was the moment for me as a, I think, 17 year old at the time, 18 year old where I was like, oh, this is this is something I can do, right? Like, this is, this is my future. This is a this is what I'm going to do. I mean, it had to.
Feel for for your dad and you to sit there and open those envelopes and see people putting money in it. It had to be like, what the heck's going on here? For me, I.
Was like, what the heck is going on? My dad was like, what did you say to these people? He thought, I did something like that. Yeah, yeah. He was like 100% going, this is illegal. You got to send the money back. I'm like, no, dad, here's what I sent them. This is it. And he's like, all right. And he was a little pissed because he was like, why did you need that 200 bucks for the website? And I'm like, now you understand? But I mean, that's always been my my process for building companies since then. It's just like build solutions to problems that I know of or I've experienced, and it's what's made building companies a lot of fun.
That's awesome. So so you've you've built what you said three different.
I've had three exits. I've probably built five. The first two are failures. Maritime vacation failed the guy from at the cottage. Com executed better. I called it maritime vacation. Okay. He called the dock. You know what I mean? So, like, lesson learned there. Actually plan for success. I mean, Brian, I'm sure you've had to tell people this. It's like oftentimes like, we if they actually just thought when this is successful, you know, investing in a good domain, building the brand like these are all things I should do that if you don't do, somebody else could inadvertently take.
Yeah, they'll end up doing it. Well 100%. But you know. Starting, building, scaling and even exiting is trial and error for most entrepreneurs. That's why once you've done it a few times, you get better at it. Yeah, and if you've only done it once in your life, or you're only doing it once in your life, you're going to make about every mistake you can make everyone. I started a business in 2010. I started another business and it was kind of a I was just testing some of my theories, but it started taking off so fast. I was like, oh my God, this is going to be $1 billion place. So I just started throwing money at it. And I built a team from nobody, from no one to an extra 60 people in like 18 months. It was starting Burton starting to burn a half a million a month. And I burnt $8 million chasing this thing, thinking, oh, I'm going to change this whole thing. And one day I'm like, it ain't changing. Nothing. Like I just shut it down. You literally wrote off 8 million bucks. Natalie actually did. I was in the middle of doing something, and she's like, you need to shut this thing down. And I'm like, I already put 8 million into it. Hardest thing to do as an entrepreneur is when you're when you're stuffing money into a black hole is to give up on it because you think you're so much closer, closer. But it was the best decision I ever made, because as soon as I freed myself up, I just I was able to put my attention on things that could create so much more value. But it was also, it's like the tale of two stories. It it like, this is everything, no matter how good you think you are. Humbled me because I was in the middle of all this other amazing stuff. But then I just couldn't get this other thing to work so I could look at what was causing the ones I was doing to work, what was causing this one to fail. And literally today, it was the genesis of my breakpoints because I went through myself and went, here's how I hired, here's how I onboarded, just how I trained. Here's the process I went through for the businesses that worked, and here's what I did. Shortcut all that or to change it. And the one that did it, and I was going through and just creating it. And then I was like, you know what? I should hire a research firm and find out what what causes businesses to work, what causes businesses to break and where and why and how. And today, that's that's all the the foundation for my break points.
Yeah, it's that feedback loop. I think that's you know, people say, you know, you don't hire the guy that's got 20 years experience, but it's the same experience repeated year over year, right. You want to learn. And I think entrepreneurs, if they're not honest with themselves. Right. Like it's one of my favorite thing to tell people is don't lie to yourself. Like look at where you fell short, challenges frustrations and give yourself permission to actually like double click and get honest.
I mean, it's the best. It's the best thing an entrepreneur can do is to say where when I when that went bad, what was I thinking about? How did I make the decision? Who was I listening to? Because that's another big thing. Huge. And you start learning. Wait a minute. The people I'm listening to, the wrong people. I'm asking questions of the wrong inputs I'm getting from other people. The reason or way I made the decision. I won't do any of that again. And until you can get there, because you just got to accept to your point, it's all trial and error. So what was your biggest SaaS based business you built?
The biggest one was a company called Flow Town. We built a social marketing platform in regards to like financial exit. Yeah. It was it was this company. So I ended up eventually moving to Silicon Valley, you know, grew up in the East Coast, small town, you know, became the big fish in a little pond, multimillionaire at 28 and eventually found myself in the heart of tech. I mean, it's literally San Francisco back, you know, today it doesn't show itself well. But back in the day, it was like, you know, this is 2008, 2009, right after the crash. You know, it was like Disneyland for software entrepreneurs. Yeah. It's like you go to coffee shops and they've got kids with they're either coding or working on their pitch deck. And I swear to God, it's all Macs and it's either a pitch deck or the writing software. And it was cool because it was the first time that I experience the feeling of finding my people. Like, I don't know if you remember, like when you were the odd duck amongst your peer group. I kind of grew up like that, and luckily I would travel a lot to hundred days a year doing my previous company. We're working with enterprise companies, so I was not in it. My environment didn't affect me as much as I think for some local entrepreneurs that their business is based in a city and they can't, they don't get out, they don't experience events or whatever. So when I moved there and I was like, oh, this is how this is a culture, right? And what I love about the Valley is the preciousness of an idea. Like, it's actually the coolest thing I've ever experienced, where you can literally have $1,000,000,000 trillion idea and people will look at you in the face and go, that's awesome! Not you're crazy, you know what I mean? Yeah. So I built this company called Flow Town in 2009 because my brother was a homebuilder. I really wanted him to understand how social marketing was going to change his business. He said none of his customers are on social media. And I was like, well, it's not true today. Yeah, so but I knew it wasn't a lot, but it was a growing segment. So the first the product was essentially a tool where you gave us email addresses and we would show you all the demographics, social, graphic and social networks that customer was on. Okay. This is, you know, today you couldn't do it because there's privacy issues around that. But back then, I mean, it.
Was wide open.
It was so powerful. Yeah. This is like if you remember, there was a product called Klout on Twitter that would give you like a Klout score, like, which was essentially a reputation or an influence score. I mean, it was a wild West of social web 2.0, they called it. And our first integration was with MailChimp. So Ben Chesnut saw we launched on TechCrunch and reached out to us, and he's like, can you make this work in our product? And I'm like, yeah, like team stuff. Let's make it work for the MailChimp customer. And that allowed us to expand. We ended up doing like pretty much if you had a CRM, a form collecting software, you know, email marketing tool we integrated and and that constant contacts. I get to know a lot of these luminary CEOs of these software companies. And yeah, that company we exit two and a half years, made a lot of money for our investors. And, you know, just really set the foundation for me to think differently about building businesses, because that was the first time I had a partner. And I know you, you know, you guys partner with a lot of founders. And that was the beginning for me today. If you look at like kind of my empire I've built, it's it's people based. Right. We were just talking about that like when you can when you can recruit, let's call it Steve Jobs, call it the 50 people. Right. When he was at Apple, he would tap on the shoulder this person in marketing, that person engineering. And every quarter they would go to Half Moon Bay and they would do an offsite with Steve, like, and there was no rhyme or reason. It was literally like, Does Steve think you're smart? And he would spend a weekend with you? Because he said to himself and he shared about this later. He said, these are the 50 people that if I had to do it all over and start from zero again, this would be my crew. And it turned out he had to do that when he he got kicked out and stuff next. Yeah, but but that concept for a lot of people that are ambitious, that have a big vision, that want to do a lot, they literally get asked themselves like, am I building my 50? Like, do I have lieutenants? Do I have partners? Do I have leaders that can actually drive the business forward, or do I have just a bunch of, you know, essentially, are you the the, the genius with a thousand servants, which, as you know, small businesses, it's kind of how they build it. They hire a bunch of people that listen to them and do what they do. But you want to hire people that are actually going to drive the business forward and come with ideas and solutions.
And I think that's that's in our breakpoint studies and surveys, we 98% of all businesses under 100 million are stuck under three, and they have an average of 12 employees.
So that is why I wrote this book that that that break point is one of I mean, you have the data. It's the hardest one. My experience is that at that level there's different and I'm sure you teach at all the different levels or different skills the CEO has to acquire to break through those different break points, zero to 300 or 500 plus or -20%. It's usually the the simple skill of delegating anything to anybody. That's right. If you don't figure that out at the lowest level, you're a highly paid specialist, you're a doctor or a lawyer or freelance or whatever you want to call it, right? And you can make a great living doing that. You just don't build. You don't. You're never an owner. You're just, you know, you're essentially a highly paid person with a job. The 2 to 3 million level that 12 employees literally I when I wrote the book, I call him Darcy. Okay. His name is not Darcy, but I used Darcy. I didn't want him to get pissed off at me, but like, it's it's it's this place where these entrepreneurs hit this, what I call the complexity ceiling. And the reason why is the skill is to learn to work through somebody. And that's a that's a scary proposition when all of a sudden somebody else is representing your brand in the market, that you've made promises to customers, and you're now working through a person that works with the team to deliver the value to the customer. For a lot of people, there's a lot of emotions there, right? There's feelings, there's anxiety, there's there's like, you know, concern. And people can't let go. They really have a hard time letting go. So that's why I wrote this book. It's not only a how to buy back your time, but actually a third of it is just leadership. Yep. How do you, as the crazy CEO, stop getting in your own way? How do you stop creating what I call emotional shrapnel amongst your team? And I think that's it's actually one of my favorite break points, you call it, to help entrepreneurs get through, because on the other side, then you have more resources. This is why most private equity firms, you know, it's like at least, you know, I mean, 750 million in EBITDA. Like they won't even talk to you. Even the micro, the PE guys, because there needs to be enough meat on the bones to do something with it.
Yeah. And they know that it's so key person to.
Yeah. But once you get past that as an owner, I mean it's it's actually if people knew how much fun running an eight figure plus company was, they would race to it because it is it's it's not even the same as what it took to go from like zero to 3 or 5. It's just.
Yeah. So so break point one's 0 to 3 million. Break point two is 3 to 8 and break point three is 8 to 15. And there's some interesting the 3 to 8 stuff because now you really got to you can't your buddy from college or your roommate from college or your sister or your the lady from church doing your books now you've got more moving parts, more people. People come in with an agenda. You start making enough money, you buy your first nice car, you maybe go buy a new house. People around you see that some divisions comes in. I've been here since the beginning and I'm still making the same money. Yeah, and and it's an.
Expensive trough to get through because you have to hire ahead. And when you start increasing your lifestyle and you're really, you.
Know, these guys are comparing. They're like, what do you mean? I got to pay 150 grand for that job. I'm paying my buddy that's been doing it only 75 grand. And and like, they're cheap and then and then they can't relate because they brought people up and now they're trying to hire people down. And it gets really sloppy in there. And they're some of the loyal people leave inherent you don't know how to hire. So you think you brought some great people in you. You abdicate to them. You're like, okay, you know, you know how to do it. So I'm going to trust you. And then they screw it up because they don't know what they're doing, and it's just a vicious thing. And then by the time you're at 15 million, if you don't have three very specific designated leaders that are working in unison, it's too much weight for a business owner to have. And that's right where private equity starts to like to play, because your EBITDA might be 2 or 3 million. The pain's high. It's real money now. And so all of a sudden you could put 10 million, 15 million in your pocket. And so that that inflection point and then and then 25 million, by the time there are 25 million, they're running on 17, 14 to 17 different systems, which is why your SaaS business is so important. And the sooner they do it, the better off they are. But they kicked the can and then they're running. And of the 17 systems, they don't know about half of them because it's the sales guys using their iPhones and their own CRM because they want to own the relationship with the client, and it's just so clunky and stuff. But it's like clockwork. What happens in the 0 to 3 million? The 3 to 8 million is certain as gravity and and it's like a structural building putting 4 or 5 storeys together. If you miss a step, your foundation is not strong and strong enough. So it collapses. And statistically, what we saw, 97% of all businesses go out of business in ten years. The bigger ones and then the the sloppy ones go out of business, two thirds of them in the first five. So so statistically. The bigger ones get bigger, bigger, bigger. But they're built on a faulty foundation and then they collapse. And what we saw statistically is if you slip back from one break point to another, you kind of catch yourself depending on how big of a slip back it was. But a snapback is where you go to break points back, and that's absolutely catastrophic. And so when you think about how hard it is, I mean, to, to to build a business to 100 million, you know, 3% of the businesses that break that, that are over 3 million, there's only 3% of the businesses that get there, but still 97% of those businesses still fail cyclically. And and so this is what I love about what you've been doing, because you were engineering what you were and what you are is you're the guy that's measuring the concrete and saying, hey, you need to you need to put another inch in there or another two inches because and you were doing it with technology. Well, I.
Mean, the fun question for me to ask somebody that thinks they got their stuff together, especially if you have their executive team around the table, is I'll ask them how many customers they have. And you see it all the time. Yeah. There is like the marketing person like, well, I think we have this many. And then the sales guys like, no, we have this money. And then and I'm like, hey, let's get the finance guy on the call because I guarantee that guy has a different number than the CEOs think he's here. And I'm like, like, you guys don't get it. Like, like, and as you you've seen the information infrastructure, the data infrastructure, the buy the business intelligence, the reporting, these are things that there is zero chance that you're going to be able to scale without smashing into a wall, especially for your fast growth, because it requires a level of precision in decision making that most companies will never have the tooling in place to see. Get that right at the right stage, right at different levels. And it is magical, the ability to make higher quality decisions, because that's at the end of the day, you know, entrepreneurs need to understand this. Like you honestly only have to do 1 or 2 really good decisions a day, and a lot of the other stuff is just noise, right? So I'm a big fan of, you know, at minimum, let's let's talk about the CRM. Let's talk about your billing. Let's get your rev rec, like figure out all the like data side. What's the source of truth. You know, all these things that again people that are like what is he talking about. Get to scale. You'll you'll spend a lot of time arguing about it, but once you have it, it makes that journey just so much easier, doesn't doesn't guarantee it.
What I love is I love I love when you're talking to the entrepreneur and they're like, no, I'm on my next system because the last one sucked. It didn't work. No. And I'm like, that's because no one on your team ever learned to use the technology. And so you move to another and another and another because you're getting sold by people on how much easier it is. But shitty in is shitty out totally and and and no discipline and accountability. No operating protocols, no process, no procedures, no systems. No, you know, like like no alignment with your team. I don't care how good your tech is, it ain't going to work because it's requiring people to actually do something different behaviorally. And business owners just don't understand that. They think, oh, I bought this software. It's going to fix the situation. It doesn't do anything because unless somebody's going to take action, that's going to be driven to an intent full result. That means if they're not that, if they don't have that mindset, they're not even putting the stuff in in order to get the outputs that will help them do that. Totally. And so I just this whole technology thing is, is always amazing to me. One of the things that we're doing, because we know statistically that from from 1 million to 25 million, you're on 14 to 17 different types of platforms. And so and most people kick the can until they're 8 or 10 million before they even think about putting a CRM in that that's actually being used. Yeah.
Versus 360 view of a customer. It's like.
Oh I have QuickBooks. Oh great. Go running in a ledger. Oh no. We just use it to pay bills. We don't put our expenses in there. It's like okay, so so you know technology is only good as to the extent you're going to use it. And and so one of the things we've been doing is innovating for the last basically ten years for small business automation, where and then and then we do the support for them. That's the magic behind our curtain is you can hire us, you you can hire us to engineer your business case. You can hire us to operate against your business case consultative or will partner with you or will downstream acquire some of you and then go buy your crappy competitors. And so that's that's kind of our funnel of how we work with people. And, and so we get exposure to a lot of entrepreneurs. I mean, I launch with Grant 52 months ago or whatever, and we've already run almost 3 billion of businesses through that cycle. And we actively manage almost a billion right now. And then there's another billion that's in our deal flow coming through. Do you guys.
Anticipate building and maybe you already have your own information system to manage that portfolio. Yeah.
So so I just made a new hire. There's a couple of things we've been investing in the technological side in a blockchain technology database technology that that is innovating up to managing what we're rolling out to the marketplace, things like managing the general ledgers and things like that. For all these different vertical roll up strategies. We have a digital marketplace now where entrepreneurs will take them to the market we'll access. This is all new stuff that nobody knows about, but we'll do their filings in order to raise capital, and then we'll put them on our, our marketplace in, in basically a private market in a private marketplace. So it's like a mini private stock exchange basically. So this is one of the things we're innovating and rolling out to the SME space. But more specifically to your question, we have been building our own data systems and processes and interfaces for, I don't know, ten years to run this kind of business, but I just hired I just made a new hire and I'll be announcing it by the time this podcast goes out. I probably will have announced it, but I just hired a head of global treasury from KKR, and before that he was head of Global Treasury for Service Partners. He's run a half, almost a half $1 trillion in the last ten years. And he's coming in as my CFO, COO with the big thing he did for both those firms is the data center izing the data and building the big data warehouses. And so we're ready to move. We have so much we have probably better content, better data on the SME space because we've engineered we've run 3500 businesses through ventures since launch. It forget about all the research I did up to then. And and because we're actively managing almost $1 billion of businesses daily, all those all that data from engineering their business to practical application and deployment in the field, aligning their teams, organizing them and watching the EBITDA, the revenue cycles, all that stuff. I'm so excited about what we're going to create from the data side, I think will be the only ones in the SME space that has it because because we're on the street and we're also looking at it from it's.
The exact same kind of conclusion I came to. So when I started SAS Academy, which was like literally me coaching. Now we've got a team of coaches and stuff where we got to a place where like software is kind of very repeatable, like it's literally retention, customer lifetime value, acquisition costs, sales velocity. So it's like we and we're all software guys that run the company because that's our background. So we essentially built this internal system where customers connect their billing system, you know, stripe or whatever they're using, and then they connect their CRM. And then we do all the like because a lot of people, they just they don't even have the view. And because we have from their CRM, you know, lead acquisition like literally have all the data that we know. And then. We were using that to coach them. Right. So they like get their dashboard and it would literally sequence the strategies to improve the business. I'm sure this is exactly how you guys think about it. And then once we had all the playbooks figured out, we essentially proved with our clients that paid us because that's what they were doing the first 100 days. Like, we know exactly what to do is literally you don't know because you don't understand how to read the data or understand the strategies involved. And then that's why we we started, you know, $100 million Holdco to buy companies because it's like, oh, it's fun to like, support them, but like I want to own them. And it's like, yeah.
Because if you're going to go, this is the thing that the small business owner doesn't understand. Like, like if someone's going to do everything for you, they might as well own you.
Literally. After five years of doing this and having my clients exit, we had 27 exits in one year. Okay, like half of them nine figure exits because it's software, you know, big multiples on on top line revenue. Screw your EBITDA. They don't give a crap. And and it just occurred to me I've always been an angel investor. So I invested first money in innovation, done 100 deals. You know intercom, Hootsuite, unbalance, Udemy, all these big, you know, billion dollar companies. But I was like, no, I want to I want to figure out how to build. So I built a whole team with my partner Kevin to literally take the deal flow. And it's fun because when people come to in my world, they come for coaching. Well, if coaching is not a fit, they've essentially identified like the PE guys. There's a problem in their business they need solved. They either decide they want to invest in themselves to solve it, or they decide now's a great time to exit. Yeah. So literally the same pipeline that we were building here, we just handed it over to this other team. And literally they just go through the funnel and if it's a fit based on our thesis, we make an offer. And I know it's a lot of fun because what size.
Businesses right now are you trying.
Yeah, we're buying like between 3 and 5 million annual recurring revenue businesses. So we've got $100 million to deploy with some debt if we choose to do that.
And where'd you get that cash from?
Raised it. 70% is from. We have two LPs like major. Yeah. Private equity guys, Talisman Capital and and then the rest of it is my partner and I.
So are you are you are you getting money out of Canada or the US?
These are in the US. US yeah. Most of my stuff I do is in the US. Yeah, yeah I bill in the US. I'm Canadian by citizenship.
You get 30% increase. Just do it bill.
Oh yeah yeah people that I'm a Canadian customers are like why is it in us? I go, I'll teach you the same thing as soon as you start, you know like it's. Yeah I'm a the.
Arbitrage from you buying the little Canadian. The technical companies are bringing them down to the first thing.
We do is fix your.
Price. Yeah, exactly.
That's awesome.
Yeah, that is awesome, dude. So what what are some of the really exciting things you're working on right now?
It's all I. Yeah, yeah. I mean, and you know this Brandon. So I asked about your information systems like we with the data and then the different large language models. So it's not just ChatGPT, there's Barding cloud and all these other ones and some new ones that nobody's ever heard of, like point specific solutions around the financial side. I just see a world where there's a lot of things that require people to analyze, to extract insights that will be real time. So it's like you get to ask yourself, when I think of and I teach this to my I have a lot of friends are in the coaching space, and I have this whole like, AI coaching model I share with them where there's like, these are the areas of today where you, you and your team should be using AI. Okay? It's around marketing and, you know, curriculum design and all these things that are very like not hard to put together. But in the future, there's a lot of other areas you're not even considering. So for example, you know, multilingual you know, generative video okay. So if you can generate videos. So all of a sudden now all the training that you create internally is not even you anymore. It's a generative. It's essentially a virtual version of you, but it looks pixel perfect. Then you got to ask yourself what happens with IP, right? Like what can I do with that? Can I license to somebody else that takes it, puts it through their model? Now they have all my best software stuff, my buddies best finance stuff, this other guy's best, you know, family stuff. And it's all packaged into one thing. So like there's all these areas of, of of stuff that will be absolutely done by AI in the next 18 to 24 months that just like so if you're about to reshoot your course, wait, like don't, don't do it. Like give me eight months and I'll show you the technology keeps getting better.
Yeah. I mean, I did $1 million in revenue last month using branded and Fossen.
Is that cool.
And and so people are watching videos and they're watching me, but it's not me. It's my eye version. Yeah. They get phone calls from me. Yeah. It's my eye.
Version, her voice, all that stuff.
So with the and if you saw the videos you would not know it's, it's you would not know. It's my eye version. You know, you can't go do a 20 minute eye video, but you can put a phenomenal video together with, with her little, little cuts in the middle of it explaining something. That's all I generated. And yet it looks 100% like it.
That's it's all dynamic. I mean, even a lot of the sales development reps, there's some new tech that is like literally calling your prospects acting as a person. It's not a person. So you have a whole team of people. You might have hundreds of people that are outbound setters that essentially go away with one monthly payment. So it's like.
100%. And it's a better it's a more sophisticated conversation because you've told it exactly what to say.
Yeah. And it gets better based on the more learns from the customer base and the market changes. Oh yeah. The interest rates are up. So I can't say this anymore because it doesn't work. Like it'll be way better than your team could ever figure it out faster. Now, what's cool for me is then asking myself the question. This is why I teach my coaching friends is what will never change. You know, to Jeff Bezos comments around like, customers always want it cheaper, faster, you know, and, you know, higher selection. So it's like anything that allows us to do that, we'll invest in that. And I call that neural transformation. Right. Like there's as a coach or really a leader, there's certain things as long as we have our our wet operating system, our brains, you know, leading ourselves until Neuralink jumps in with a brain machine interface, etcetera, which could happen. Should happen maybe, I don't know.
Everyone wants to know how. Gary breakfast. But I had a Neuralink installed in Gary Breck.
That's the way to do it. Yeah, it's not really. Gary is a beta, is it?
And his genius isn't really him. It's all the smart people around the world.
Well, I just don't know how he remembers all the doctor terms. He does. He's an impressive.
He's a he's a photographic memory. He's brilliant.
Yeah. I think a lot of people, they don't realize some of these folks out there have that. Yeah, yeah. And I just. It's not me. Me neither. But the neural transformation is around the belief sets. It's all the it's all the mindset stuff, right. Like you work with so many entrepreneurs. Like I'm sure you're staring at people going like, do you realize that you are the thing stopping you?
I wrote a book called I wrote a book specifically, yeah, nine Figure mindset, because people are like, oh my God, how did you it's like, look to get to nine figure. It's really super simple to get to a nine figure mindset. Yeah. First got to get to a six figure mindset. To get from a six figure to a seven figure, you got to change what you're doing and how you're doing it. Now to go from 7 to 8. It gets more complicated, but it's the same theory. Switch what you're doing. Do it different. Up up up up. Level up. Level yourself. Yeah. And then when you can multiply through other people, teach them. Do what you did to get to six to 7 to 8. You're going to go to nine. And then if you get enough people that you can teach to do what you did to get to nine, you're going to go to ten. And, and and then when you do that you get an opportunity to go to 11, but you're not going to go from 6 to 9 and skip. Those are the break points. I mean, you got personal break points, professional break points and financial break points. And if you don't acknowledge and accept that, you have to literally be a different person to get to a seven, an eight and nine, a 10 or 11, then you were to get to a six. If you don't just acknowledge that and accept it right now, and then ask yourself this honest question, what am I doing every day to develop myself and be in the right circles and learn new things and get different results, so I can build my confidence in to moving technically to the next level. And and what I love when I'm talking to a technology person is you get that from a technological standpoint. If you're if your technology platform is exactly the same today that it was five years ago, you're probably out of business or you're going out of business. It has to evolve. It has to develop. It has to expand. Yeah, mine's exactly the same way. And so is your activities. Your actions.
Yeah. Yeah. I mean, that like the big core of my book is obviously like I look at it, there's four ways to get leverage, right? I call them the four master skills. It's either capital right takes money to make money. It doesn't take it takes being resourceful. Make money at certain point. If your number one constraint is capital, everything else is there. The the playbooks are there. It's all and it's just capital. Fix that. Second one is content right? Content. Huge leverage SOPs. Processes like these are things you can spend a couple hours for. And if you have 1000 people that follow it, you'll get like huge this this podcast, I mean, it's just there's all like most people don't consider these things and they keep doing the same thing. So content is huge. The third one is code. It's automation. We've talked about that like and in automation and removing yourself from processes in like human error in the steps to eventually like, you know, handheld devices. And it's like a checklist and, you know, you can have a whole army of people out in the field doing the thing, delivering on the promise 100% consistent every time. And you get the reporting back in the day. I mean, it's just that's the code side and I think is just the next level of this. But the fourth one is collaboration and it's the people. It's the it's the team. It's the it's. And to your point on the mindset, it's your self-worth around your time. Most people never learn how to buy back their time because they don't feel like they deserve it. They don't feel like they're worth it. And what I've learned a long time ago is that I will never get a penny more than I think I deserve. Yep. And my job is to figure out how can I increase my self confidence, my belief in myself surround myself. And that's one way to do it. Your environment right? To increase your internal thermostat, your identity. And I just think like if you're an ambition, ambitious person and you're worried about sacrificing everything, you've built your relationship with your family, you know, your, your partnerships or all that stuff, like be ambitious, but learn those four master skills because, like, there's nothing I want to accomplish. I can't as long as I'm honest about how good am I out of ten on all those four areas? Because that's how I buy back my time.
100%, 100%. And we watched, you know, there's so many great examples. We were talking earlier about Gary Brecher, and when I started working with Gary Brecher, Grant introduced him to me because I was £40 heavier. And you look.
Great, man. Thank you.
And I was struggling and he's like, let me introduce you to my guy. So he introduces me to Brett. At the time, Brett was doing a couple hundred thousand dollars a month. He was working in a little clinic.
And is it really that small? Oh, he was tiny.
He just had like 4 or 5, six people. His wife and him and his kids. It was all family for the most part. And so I started working with him, a man he was changing and I really like. He was just such a great guy to be around. And he cares so much about people's health. And he saw us precision smart about how to do things. And and so I just listened to him and did what he said and I started dropping all this weight. Well, people are like, what the hell are you doing? And so I went to Gary. I'm like, dude, we should partner on this business because you're starting to show up two hours late, three hours late, four hours late, five hours late. Sometimes you would no show us because you're overwhelmed and and and you're so in the business, there's like, you got to learn. So he came to my 360 class. And in the first day he was in the room for an hour out of ten hours. And I'm like, dude, what? What's going on here? He's like, oh, I got all these people call me and I can't. I'm like, all right, well, here's the deal. If you really want my help. By the time that six months of working with him, he had grown about 400,000 a month. For 50 a month. Yeah. And Grant was putting him on stages because we were working together and introducing him. Some people. And Gary had moved to Miami and got out of his little town in Naples. And then, you know, obviously the pool of people to talk to was much bigger. And he's like, dude, I'm just I'm, I'm getting crushed here. And I'm like, the only this only going to work if I buy you and Grant and I'll buy you and all all take on the responsibility of engineering the business, and we'll put you into the best version of yourself and get all the bullshit off your plate. And and so we did. We acquired his business two years ago. He and sage, they were partners. And I think when we bought him the month we bought him, he was doing like 4 or 500 grand a month. And and now we're doing 5 million a month. And he has blown up. He had a he had a billion views on a social media last month. And we are just turning on and activating the Legion from that because I couldn't handle the I cannot even just the referral day because the complexity of the business. This is not like you're selling a vitamin.
A medical.
Thing. It's medical. And you got medical laws, you got medical regulation, you got medical rules, you've got FDA, FTC, HIPAA. I mean, you just can't treat it.
Like how many locations? I mean, well.
We only have a couple of locations. We're opening two here. We've got one in Beverly Hills.
Yeah, I know we're.
Opening 1 or 2 in Vegas. We've got 2 or 3 scoped in Dallas. We've got 2 or 3 in Atlanta going in, and we've got Miami probably 5 or 6. And we're collaborating with our some of our patients. So all of a sudden some of these people that you're going to hear from that have like a Dana White didn't wait for us. Right. Dana Dana was like, I'm going to tell the world, which caused a problem for me in the scaling process because there was no systems. It was 100% still manual, and I was just starting the automation process. And he just went a year ago and he started going public and talking on podcast. And we went to being entirely overwhelmed, which I'd rather be overwhelmed than underwhelmed. Yeah. And so it's been a it's been a nice it's a nice way to represent because we're, we're tracking every single cause and effect. Right. What's working. What doesn't work. What broke, what didn't break, how we fixed it. It's going to be a test playbook for the next Playboy playbook for a lot of people, because the story is so great. And I flew to Austin for a meeting last night, met with Gary, and the people were meeting with, I mean, this health story is going to be $1 billion company here in 36 months. And, and, and the lives that are being changed and the exposure Gary's getting and the promotion Gary's doing around it. His highest form, like Gary used to sit one on one with a person and spend all this time with him. His highest form is not him sitting one on one, it's it's communicating to to a billion people on a stage. Yeah. And this is how where we've positioned him and it's where he thrives. Although he's an expert at the one on one, it's where he thrives. And what branding.
One thing I would I don't mean to cut you off, but your genius that I see again from outside we talked about before we started recording is your ability to understand collaboration the equity. Right. Even like your previous companies, that is always the part. I grew up in software, so it's kind of built into the DNA, right? When you when you do a venture back company, this is the, you know, the cap table at different levels of and you have your your Esop, you have the employee stock option pool. And it's just like for your vesting when your cliff's like it was all kind of given to me. I didn't have to think about it. It's kind of like try to intrude. That's not the only way to do it. But it seems like that's what if like again, I just assume, like with Gary and Grant and all these other businesses you're involved in, that you've gotten to a place where you're like, hey, I'm really good at figuring out comp structure, incentive process, you know what I mean? Because like, that's that's the thing even a Buffett does so well where he's like, I, I designed the game where if people play it, everybody wins. Yeah. And a lot of entrepreneurs are. It's mine. Well, they don't want to let go. They don't understand how to actually, like, create a bigger pie. How do you think about that? What's your mental model around that?
I think the reality is, is that it's the path of least resistance. And the more people you have incentivized and aligned, the more they're pulling the business versus you as the owners pushing the business. The problem is, for the small business owner is the advice that they get around. This whole subject is so pathetic. It's so horrible. They go to their bullshit attorneys that don't know what they're doing. They go to their bullshit accountants who give them free advice or worse, charge them for shitty advice. Most partnership the reason most businesses break up the biggest break point from 1 to 5 is partnerships. Ill, ill or ill. Ill prepared. Poor operating agreements. No exit structure in the operating agreements. No operational requirements in the operating agreements. No performance requirements in the operational agreements. So all of a sudden the business does well one partner exploitation golf, the other one's busting his ass or her ass and and so it's just so poorly constructed. And so the idea and then they're all told don't give equity because it's so most horrible. No, I guarantee you, I've never seen in a business under say, 50 to 75 million, I see 1 or 2 things. I see such poorly constructed efforts to, to try to, to try to align using equity and incentives. Or I see these overly complex like I tell business owners, if you're under 100 million, don't even use the word Esop. Yeah. And if you're over 100 million, still don't use the word Esop. There are better structures because as soon as you give 1% to somebody, they think they can dictate to you, oh, you bought a new truck, boss, or you're spending money on an airplane or. Yeah, that I'm going to sue you now. So they start to think, these little LPs start to think they have some kind of operational control, or they have some opinion or they have some say, and it shifts the business from, hey, we're building to a high performance to what's in it for me and why am I not so use profit interest correctly. Yeah. And, and, and most people go, I don't even know how to structure it and whatever. So they go, they try to do things and they're sold and.
Talking to the wrong person.
Always talking to the wrong person. So so this is the thesis behind grant sell or be sold. You know, if you're not selling an idea or a concept, somebody else is selling you. And so unfortunately, you got to unwind all that shit too. And when you unwind it, it causes other issues. And, and so, you know, it's like making sure this is this is what I tell business owners. There's three questions. I always ask somebody if I'm going to get any advice from them. And and here's my three questions. The first question I ask somebody when they start to tell me what I should do, is say, hey, before you tell me that, I just have a question. I have three questions just to qualify so I can understand how deep I need to get into what you're going to tell me, because if you're going to give me advice, I really want to understand it. Yeah. Fair enough. First question what's the most amount of money you've personally ever made in a year? It's important for me to know because if you haven't made more than me, it's a check mark for me.
Yeah, it's not not a hard stop, but at least it's I can, I can.
But the second question becomes a hard stop, which is what's the biggest thing you've ever built? Quantified by number of employees, revenue and profitability. Like, you need to tell me that if I'm going to listen to you. And then the third, it's not a hard stop, but it compounds. It is. What's the biggest exit you've ever had? Now people are like, do you really ask those questions? Absolutely. If I'm going to talk to a mentor now, if I go sit down with John Maxwell, I'm going to use a different series of questions because I'm looking for leadership enhancement. I'm not looking for someone to teach me how to build my business. Right. And and so, so the reason this is important is to know which people you're going to ask questions of before you even let it in your brain is because I have watched so many entrepreneurs build $100 billion business, busting their ass, risking everything, and then selling it for 20. And I've watched entrepreneurs build a $25 billion business doing it pretty laid back not much risk and sell it for 150 million. Yeah. So which guy do I want to learn from. Because I don't want to do it the hard way. I've also watched.
People and the people that have one. Sometimes they can't even tell you how they did it.
Exactly. And so so if you ask those questions like, well, to be honest, I don't really know, you know, I just got lucky. Okay, well now I can't I'm not getting lucky. Like that's not going to be something that happens to me. So learning to qualify who you're listening to, what you're asking them, what you're letting in your mind because most people collect their data through polling, polling. What should I do? What do you think? And they're asking all the wrong people have never done it. Versus pulling. Pulling like who can pull me up to the next level? Who actually has experience, who has knowledge, who has information, who's willing to help me if I'm going to try to build my business through polling, polling, I'm going to fail horribly because.
I'm trying to synthesize this information with no context and nobody.
Knows and I don't know and people bullshit. And you see that? That's one thing. When I got on social media, I was never on social media. I got on social media. I'm like, oh my.
God, yeah, you saw it.
And so I'm going to tell you a little secret and you'll appreciate this. And people are going to start hearing this. And so I'm starting to leak it out so they can get ready. Next summer. I'm going to challenge every scaling expert that's in the marketplace. I'm going to use the UFC center apex. I'm going to have the ring up. I'm going to invite anybody that wants to claim their scaling expert to come into the ring with me. And to post 60 months worth of their numbers against mine. And if they beat me, I'll give them a million bucks. Because I'm going to quit the bullshit. Yeah, I get too many people coming to me.
Yeah, they're asking you for advice, and they're saying, this other guy told me this and you're like, I'm not. I'm not even talking to you. This is.
And it's it's all superficial bullshit. People are spending money with all these internet junkies. Yeah. And it's it's not. It's not that I want to prove those guys wrong. It's actually damaging for the business owner because it's the nuance. You know, this, you could just change one little code in a system and get a much better output than if you're than if you have a bad data piece. It's going to send you in a different direction. So it's the incremental improvement or the granular technical thing. It's not the macro idea. And so people are stealing other people's ideas and then pawning them off like they actually did something. So I'm going to issue this scaling chain I love it. And and I'm going to turn it into a competitive. And there are some people that will show up. Yeah that might beat me. Yeah. But I've it's okay.
You have those people. And this is what's interesting is, is those people I don't think are there on the internet. A lot of them are the private equity folks.
Well, those guys are different. I'm talking about the social, okay.
You're talking the internet guys.
Yeah, but but look, I'm friends with some of these guys, you know, like Herman, he's going to be a formidable competitor. And and and and Moses both of them. Yeah. And you know what? They're doing it a little differently. Have mad respect for them.
Yeah. Lila wrote the blurb on the back of my book. So.
So I love those guys. And they're so.
They're practitioners. They're actually in the trenches. They're doing it. They're teaching exactly what they did that day to help a portfolio. Exactly. I hope, I hope.
I believe that them and a couple of other are going to be the best challengers. Yeah. And and and and it's going to be fun. Yeah. It's all the other people and and so in my mind it's like, look, I launched this business 60 months ago. Here's what I've done exactly 60 months. Anybody who's beaten these numbers fucking I'll write a check for $1 million. Yeah. And and you got to bring your pals. No bullshit.
No, no.
It's not your clients revenues that you're sitting on. It's your generated revenue. And I'm going to issue that challenge in at the end of this year. And, and I'm going to start promoting the hell out of it. Do you think that's a good idea?
I think you know what a lot of these guys have, which I've always admired about, you know, even like the Tai Lopez, the Grant Cardone says, you know.
Hey, by the way, he's excluded. He's my partner.
Yeah, yeah. No, it's good that tie.
Happy to bring tie on. Yeah.
And I don't think tie would claim he's good at that stuff. You know, ties a thinker. But it's just there's a lot of these people that are great at marketing, but they're not the operator. Right. And I would say, you know, and I love Layla, like, obviously Alex is a better copywriter position packaging person. And Layla is just honestly one of the best operators I've ever met.
And and they'll tell you that like, no, no, there's no secret. They say, I don't want to have any conversation. No.
It's like there's no Alex at that scale with that Layla, vice versa. And I think that and for us that's we've had to find those people. Yeah.
Yeah. Secret. I got my own Layla.
Yeah. We all.
You can't do.
What we do without that. For me. Yeah. You can't do that at our scale. So I think the fact that you're saying, hey, I'm going to use the this concept to get the word out to put, you know, essentially, like, just finally like whoever wrote the book or says they're the best at this, it's like, let's talk about it because, like, I'm, you know, that's why I like your work. Is that you? You can tell by talking to you that you understand this at a depth that most people will never have the privilege of going through the cycles and iterations to try to understand it like I have, like I've I just spent more time studying this stuff because I don't know why my brain just likes it, right? Whereas other people spend more time thinking about how they can get a bigger audience or whatever. Put both of those together. That's why I loved your partnership with Grant. It's a weapon.
You know, Grant was when we went out and looked across the spectrum. Grant had raised more money in crowdfunding than anybody on the planet. And he's. And he's know.
That I know. And he was early to that game. As soon as the laws change, it's like, game on, let's do it.
His sales and marketing and then running his events. And I came to those events and and I saw what he was doing. I met the highest level. And I'm like, this guy has been so committed to the message.
And consistent.
Consistent, built a huge audience and wasn't even offering him 90% of what we could offer him. And when I approached him and showed it, he's he's like, dude, I've always wanted to do this if you don't let me down because he's said most people let him down. If you don't let me down, you do what you say you're going to do. I will go all in with you. And and we've built this business. All the enterprise under Cardon is five times bigger than it was when I came into the relationship with him. Not because I did that for him with real estate or anything. It's just he can go put his attention on it. And then this business is two and a half times bigger than his core business was when we partnered in four years, and now his core business is bigger than this business. So collectively we've grown. We're about $600 million this year. And and we're spawning off a bunch of new businesses. So we spawned off health spawning off to next insurance. That's going to be unbelievable. Yeah we've got ten back. We've got ten home services. We've got ten X pools and spas, ten x farms, ten x cyber. We've got ten different formats rolling out that will all look like health over the next 18 months. Yeah. And and so my my deal is challenge number one is took me 60 months to get to a couple hundred dollars million in revenue. The next 60 months we'll hit a billion. But we're going to create a $50 billion portfolio. And then he's going to create a $50 billion in the real estate. And we're going to go to marketplaces $100 billion company and under assets and management. So I'm unbelievably excited about it. Here's what I know about you. And I I'm glad Jeremy said that you and I should get together. Awesome meeting you. Congratulations on your book. Buy back your time. Look, man, that's true. Buy back your time. And I know now, based on this podcast, you and I are going to do something together. And and I have some ideas of some things we're working on already. And I'm really looking forward to it because people will listen to this podcast. They'll go, oh, these two never met. Here we are. I mean, we met, but we now know the day.
Yeah.
And, and and then it won't take us but six months to a year to have something to the marketplace that people will be really super excited about. And I'm looking forward to making money with you, changing people's lives with you, building with you. And I love your story, dude. And there's more to your story that we didn't even get to. So we're going to have a part two here. Say it's six months from now. I love it, and we'll disclose to people what we're doing together, and we'll talk more about how we're building and we're how we got here.
I love it, it's honor.
Thank you for joining me on the Dawson show that's now building billions that used to be called the B. Dawson I like the new title.
It's accurate.
It's my wife has building billions with Natalie, building billions with Brandon. And then we're launching building billions together. And it really it's to document every single thing that we're doing along the way. It's awesome for the for the next book I'm putting out, there's two books. I've got my next one coming out. It's going to be kind of the operating system, how how we did everything. But the third book is that the set a nine figure mindset is the 1015.
Because I love it.
I'm setting the stage for it. Everybody, thank you for listening to another episode of Building Billions with Brandon either listening or watching. Remember what inspires me to do this work and bring on phenomenal guests like Dan, is you liking, sharing and and participating? So if you have comments, please leave them in the message line. So thank you for listening or watching to another episode of Building Billions with Brandon.