Natalie Franke
Is it a terrible time to start an independent business? Is there such a thing as a bad time to start a good business? We’ve been hearing a lot lately about the economic headwinds that many of us are either seeing play out around us or experiencing firsthand in our own businesses, things like inflation and rising supply costs, labor shortages and challenges left and right, as we face an economic uncertainty that has a lot of business owners, rightfully nervous. In today’s episode of The Independent Business Podcast, we’re sitting down with Donald Miller, New York Times bestselling author of building a story brand, and business Made Simple. He has helped 1000s of businesses to grow with his powerful frameworks. And now he’s sharing his secrets of success with small business owners. A lot of us especially in these economic times, feel trapped in the day to day operations of running our businesses were stressed or discouraged. We’re not feeling quite so confident in how things are going. And if you have been in any of those places, if you are feeling that way. Now, this is an episode you are going to want to listen to Don’s latest book, how to grow your small business, a six step framework to help your business take off is his roadmap shared his journey from four employees working out of a basement to a $15 million operation, increasing revenue, six fold, in just six years, he is going to go there, he’s going to have the conversations with us. That’s so many wish we could have, he’s peeling back the curtain. And like I said, this is a conversation you don’t want to miss. Hey, everyone, this is your host, Natalie Franke, and you’re listening to the independent business podcast, more people than ever are working for themselves and building profitable businesses in the process. So on this show, I sit down with some of the most influential authors, entrepreneurs and creators to break down the science of self made success so that you can achieve victory. Don, thank you so much for joining us. Good to be here. I have been following your journey for a long time, I’m gonna allow myself the opportunity to fear and girl for just a moment because I’ve been following along with story brand, I love seeing you welcome a little one around the same time that I had Harlow and also just leading the way that you lead, you show up on social media in a way that brings knowledge in an accessible manner, you are calm and collected every time I watch your content, I’m like, it’s gonna be okay, it’s gonna be okay. You know, like, you just you bring this wealth of wisdom and experience and you deliver it in such a way that as a business owner, when it feels like the world is just chaotic and unknown. And, you know, you’re juggling a billion things on your plate at any given time. I really appreciated how when you share you share from this place of like, look, I have a strategy, I’m learning, I’m going to share what I know with you. I’ve done it, I’ve built it. Let’s talk about business. And it is so inviting. And so I just want to thank you for coming on the podcast, and just sharing your wisdom with everybody today.
Donald Miller
Well, I’m grateful. I’m grateful always to be able to talk to entrepreneurs. And it’s a it’s a tough grind. But it’s just so I just think it’s fun. I really do, especially when you get over certain humps, and you’re not worried about where the next dollar is coming from. But Saturday with you.
Natalie Franke
Yeah, for sure. And look, in the last year, a lot has happened, a lot has unfolded. We just recently ran a survey with a group of independent business owners and others to kind of unpack how they’re feeling in this present moment. You know, we’ve got economic uncertainty, there always is economic uncertainty. But it seems to be a topic of conversation. These days, we’ve seen high inflation numbers, a lot of people are experiencing, you know, supply issues, labor shortages, I won’t go on and list all of the challenges that a lot of our community has been feeling. But what I will say is in kind of an intersection point, we’re seeing an increase in these challenges and increasing conversations around these challenges. And yet, more people wanting to start small businesses than ever before. We saw record setting numbers of new business applications in 2021. And then many expected that number to go down. For for reference for everyone listening, you know, 2021 there were 5.3 9 million new business applications filed in the United States. It last year 2022 People said, Oh, that was a fluke, that was a pandemic mishap. It’s going to go down there’s no way that trend will continue is going to go back to the 3 million mark like it had been. But no. According to latest data, it was about 5.1 million new business applications filed in 2022. We also did a poll and uncovered that around half of employed adults who are not already independent business owners say they’ve considered leaving their current job to work for themselves. I would love to know as we kind of kick off this conversation. Is it a good time to start a business? Is it a bad time to start a business we’re hearing about the economy but people have you know realize they want something different for their lives. Can you just Give us a little bit of direction here. What do you what are you thinking? What are you seeing?
Donald Miller
I personally don’t think there’s ever a bad time to start a business. And I don’t think this is a bad time to start a business. So of course, that depends, depends on what your business is going to sell. Because, you know, it might be a bad time, depending on whatever it is that you that you’re trying to sell out there. Two of the sources that I trust the most on the economy, are actually Janet Yellen. And Janet says mild, very mild recession for America, the International Monetary Fund is also saying mild recession for America. And the other source that I trust is Amazon’s financial predictors, you know, they have a team of people who predict where the economy is going, because Amazon is so dependent. And right now, they are also saying very mild. That’s good news. For most of us. However, I think in certain businesses, you actually go up grow during a recession, we grow when COVID hit and the world shut down, we had a record year, both in growth and overall revenue. And so it depends if you sell money. And what I mean by that is if you sell any sort of business coaching, or business education or business help, life coaching, executive coaching, any sort of service, even therapy, you actually grow reception at because people have a toothache and they tend to go to the dentist when they have a toothache. And if they’re hurting for money, they tend to spend money on ways to optimize. If they if they don’t, if they they can easily go downhill. If people are rolling in money, they tend not to look for help. If people are short money, they tend to look for help. So it just depends. But at the same time, if you’re thinking bad times to do this, inflation is going crazy, we’re getting that under control a little bit, I think not a big fan of some of the stuff that our government does, but I think they’ve handled this pretty well. And so I think we’re gonna be okay. However, all of those business applications that were filed, 25% of those businesses will be dead within one year 45% will be dead within five years, and 65% will be dead within 10 years. Correct. And so there are a lot of people who are going to wake up one morning and wish they hadn’t done it. And almost none of those people had to experience the death of their business at all. You know, when I say Natalie, you probably agree with me, I don’t know. But nobody gets into business to start a business. Nobody, nobody gets into business to run a business. You don’t want to run a business. You want to love customers, you want to sell a product, you want to create something you want financial independence, you want more time, those are the reasons we start a business. If the business succeeds, though, you find yourself doing something you never ever imagined. And that is run a business and running a business is totally different than making a product and selling it. It there’s a lot more to it than that. And so I hope that everybody listening can figure out just some very basic business acumen. Because I think that number is 65% business businesses crashing, I think that number should be more like 25%. Because you know it right there, the rest of it the difference that other 40% shouldn’t have died. They just died because they didn’t know how to run a business.
Natalie Franke
So let’s talk about how to run a business because I know you’ve got a book coming out, that’s gonna help walk people through that and really give them a roadmap to growing their small business. Walk me through that. So you know, you’re right. I agree. 110% I think a lot of us get into this because we’re passionate about something or you’re right want to be our own boss, we have a desire to make an impact in the world. We love the clients we get to work with, so on and so forth. But then the business challenges arise, do you start to feel discouraged and overwhelmed, and you know, it’s like the weight of the world is on your shoulders and all those things you never could have imagined burning you out, start to burn you out, I say you run the risk of leaving a nine to five to work 24/7 You fall out of love with the very thing that that you want to dreamt of doing? How do you recommend business owners start to really tackle that and not become the statistic what are some of the recommendations for example that you give in your book? Where should we begin?
Donald Miller
Well, the very first year, or two or three of your business, you need to obsess about something that most of us don’t want to talk about. You need to obsess about cash, where are you going to get it? How are you going to keep it? How are you going to not let any of it go? You’ve just got to do that. Business is about making money. And a lot of people don’t want to think about that. They don’t want to be the sort of person who obsesses about money. They don’t want to be in it for the money. You know, I would agree that you shouldn’t be in it for the money if you’re in it for the money. It money is very fleeting and it doesn’t satisfy you. However, if you your business is going to eat money, and it’s going to eat a lot of it. As soon as you get started. You’re going to realize that you’re in a different tax bracket. You’ve got to pay your own taxes. It’s not being withheld from your paycheck. You’ve got to buy Inventory, you’ve got to, you know, if you get a virtual assistant, then you’ve got one person on your payroll. And I hope that happens for everybody very, very quickly, you will realize that your business eats a lot of money. And so in order to let the business eat money and have a little bit left over for you, you got to feed it. And the way that you’re going to feed it money is you’re going to make sales. And so, you know, uncomfortable, though it may be, I really think if if one of your listeners were sitting down with us, Natalie, it’d be curious to hear your take on this to the very first thing that I would do with them is I would say, hey, let’s determine three economic objectives for your business. And we’re going to set a 24 month timeline on those economic objectives. And here’s what I mean by that, I need to know how many of each unit you intend to sell over the next 24 months. So let’s say you’ve got 10 items that you sell, you’re doing this at a farmers market or whatever, you know, and I say, Okay, where’s your biggest profit margin? You say? Well, it’s in these spice packs, you know, we put these, these we put these spices that my aunt and I made, it’s her proprietary recipe, you know, we make a lot of money off these things. I say, Okay, well, you know, how many did you sell last year, we sold 100 things, okay, well, we need to sell 500. And we’re going to write down that we’re going to sell 250 of these a year. And then we’re going to take what’s the next most profitable thing that you sell? Well, we sell this and we’re going to write down a goal for that. And then we sell this, we write down a goal for that, that those numbers are incredibly important. Because what that does is it changes your mindset from just I’m going to be really friendly at a farmers market and have a really beautiful logo and put my logo on a book bag and all this other stuff that we tend to do. As entrepreneurs, you add to that equation, the fact that we’re here to sell things. And what happens when you when you actually make those economic objectives very, very clear, is you tend to reverse engineer them, you tend to say, Well wait a second, if I have to sell 250 of these, I only sold 40. At the last, therefore, I think I’ll make a sign. Therefore, I think I’ll send out an email explaining, therefore, I think I’ll carry them with me in the trunk of my car, therefore. But if you don’t set those economic objectives, you don’t tend to hit objectives that you don’t set. And so we need to sit down and embrace the fact that this is a a monetary goal that we have, it’s hard for somebody who hasn’t been in business for a long time to understand that that drive to make money is not about actually making money. You know, my business made, gosh, close to $17 million. Betsy and I, my wife and I paid ourselves $150,000. So when I say we need to make more money, more money, more money, it’s not to pay me. It’s to keep this business afloat, to put the business exists to put money into an investment account so that my daughter can have it. 50 years from now, it’s really not about me making money, I don’t need any more money. But I do embrace the fact that this business exists to make money. And once you understand that, I think you can reverse engineer it success. The reason 65% of businesses fail, they all failed for one reason, they ran out of money. That’s it when you run out of money, the game’s over. And we don’t want that to happen. anybody listening?
Natalie Franke
I agree wholeheartedly with everything that you shared, I think, you know, personally, in my own journey, my relationship with money required a lot of unlearning, and a lot of unpacking and learning. What did you have to unlearn? You know, I come from a kind of background of seeing money as something that is rooted in greed. Right? You know, again, you do something because you want to be of service because you love people, not because you want to profit off of them, I had to kind of rewire some of that understanding and, you know, also learn a lot of things that I was never taught, you know, I never learned about investing. I never learned about retirement. I never learned about a lot of these things that especially once you leave like a W two work corporate environment situation, which our comp our country is built truly is like built for the majority of individuals to get certain benefits from an employer, not from any other source. So health care, parental leave retirement, you name it. So for me, you know, I felt kind of unprepared when I started my business, and I realized, Wait, I have to say, for my own retirement, like someone’s not gonna help me do that, you know? That’s right. Those sorts of moments, in addition to just, you know, when it comes to sales, and as a woman, too, is is something that, you know, I’ll never forget, we did an entire month dedicated to sales. And in our community, especially, you know, several years ago, I think it was about five years ago, I was living in San Francisco at the time. I will never forget talking even about you know, the differences in how people sell and hearing how so Many women, especially in our community felt like you know, they always had to be pleasing, and were afraid to like, just step in there and command their value and pitch in a certain way. And there was so much hesitancy. And so, you know, I think that in that regard, too, like a lot of unlearning, and a lot of unpacking and having to kind of figure out No, I can’t be proud of what I’ve come to the table to offer, I don’t have to qualify everything with like, oh, you know, like, I know, that’s a lot of money that I’m charging, or when you’re in a client meeting second guessing that and seeing the impact of your business in a different light seeing making money in a different way.
Donald Miller
Yes, yeah. And once you sort of understand that the money that you make, you know, goes to feed a machine that pays you and you are one of the employees, it, it feels a little bit different, it doesn’t feel like greed, you know, when I charge a lot of money for me to go speak or something like that, that money goes to pay benefits for my 30 employees. And it goes to pay for a lot of other things. So I no longer associate the money very much with myself. That said, at the end of the day, the company makes a lot of money. And we put that money into an investments. And so we’re we’re building wealth while we’re living off our $150,000 salary. And you know, I’m grateful for for all of that. I will say though, I want to go back, Natalie to something you said that money is so associated with greed, and corruption. And, you know, even the Bible says the love of money is the root of all evil. But what it doesn’t say, though, is that money is the root of all evil, it says the love of it. And what we want to do is we want to be the sort of people who give money a good name, instead of a bad name, because there are people in this world who give money, a bad name. And there are people who give money a good name. And all I want everybody to do is say, hey, just be be the people who give money, a good name, give it away, be generous with it, provide jobs with it, I don’t think money is evil. Now, I do think there is something that is evil. And what I think is evil is poverty. I think it’s evil. I think a you know, a child looking at their mother wanting food and the mother not being able to afford to feed that child is evil. And I am all about rooting it out. And I think entrepreneurs, the entrepreneur is listening to me right now you are the backbone of this economy. And you going out and making money for yourself and hopefully someday making enough that you can bring on somebody else, and you can pay them and you can pay them. That is how we grow the middle class, we grow the middle class, when everybody listening to my voice gets rich, period. That’s how it works. And if you are driven to build a financially successful and sustainable company, you are a gift, you are a gift to the world because what the what everybody in the middle class has in common is that they can feed their kids. That’s what they have in common. So if we make the middle class bigger, we have less poverty. Now I do agree, just economically, in broad strokes, we have a problem in America in that some people have too much money. But even those people have been incentivized to get that wealthy Warren Buffett and Elon Musk and and Jeff Bezos, these people have all been incentivized to keep their money in the market, where it tends to grow compound interest, because they don’t have to pay taxes on any money in the market. So the government is literally incentivizing them just to get rich, all they’re doing is being smart. They’re they’re not being done with their money. So I don’t criminalize those people at all. But we do need to deal with that we need to incentivize those people to put to put money back into the middle class. The middle class, by the way, is gone from about 67, or 71%, and 1960 to 50 something percent today, very low 50s. So we’ve got a problem. The solution to that problem is everybody who’s listening to my voice to stop having such a dysfunctional relationship with money, and instead command money, tell it what to do in order to serve the world rather than it, dictating what you’re supposed to do. And one of the things that my wife and I do, in order to not let money control us is we live we live off a tiny percentage of the money that we make, and we just don’t, we don’t give ourselves the options to fly private jets and all that kind of stuff. I’m nothing against that. But we just don’t do that. You know, we we live pretty simply.
Natalie Franke
Amazing. I you know, I think a lot about how we’re living in a moment where it has never been easier to start a small business. It’s so simple. It is so simple. And you’re absolutely right. I think, especially for me, one of the things I’ll say to just circling back is my mindset started to shift a lot around money when I realized wow, when I make money, then I have the ability to do good with it. Like it was like a light bulb. And I It sounds so simple to some folks. But to me, it truly was it was like, wow, when I build a business that generates wealth, I can support other small businesses in my community, which I am fiercely passionate about. I call it like I’m a mama bear for small business. And so, you know, I can reinvest that in my community and statistically we see that we see that when you know money is spent at a small business it tends to stay in that local community we see good done with that money, you know, but we’re living in this moment where it’s easier than ever before to start an independent business, we’re seeing shifts in the way that young people are viewing their futures. I, I think a lot about a survey that actually was commissioned by Lego of all places that says that, you know, more children want to be content creators that want to be astronauts. So we’ve seen this like shift in the aspirational dream. I
Donald Miller
love that. And the reason I love that is you’ve actually got a shot at being a really good content creator. And it’s like a one intention out of being an astronaut. So I think the percentage chances are really good for you if you want to be a content creator.
Natalie Franke
Yeah, my grandfather was an aeronautical engineer for NASA for 30 years spent a lot of time around astronauts and I know that he would agree with you, I guarantee he would agree with you. And so I see it in my I see it in my kids too. Like my, you know, my, he’s gonna be for my four year old, he loves and some of some of the parents out there can be like, Wait, screentime for a four year old, but hear me out. Hear me out. It’s been a rough couple years, y’all with a pandemic. But there are content creators that he absolutely loves. And I think about somebody like Mr. Rachel, who I don’t know,
Donald Miller
oh, no, we have Miss Rachel wheels on the bus go round and round, I’ve seen it about 5000 times, it’s the only thing my daughter will watch, by the way is wheels on the bus go round around with Miss Rachel,
Natalie Franke
it’s funny, because that’s Harlow, his favorite song too. So I think I think these girls are gonna be friends when they grow up. But Rachel, Mr. Mitchell is a great example. She’s She is a business owner. She’s someone that you know, during the pandemic, and very smart when when a lot of kids were isolated, and especially kids, like my son was speech delayed. And so you know, needing a different type of content and needing to have preschool, essentially, virtually, she’s created a virtual preschool, and she’s done it phenomenally, and leveraged her unique gifts and talents to make an impact. And I think that’s at the end of the day, you know, I see that over and over and over again, with with our community with independent businesses, it’s like, they have something really unique and really valuable to offer. And as they do that, and if they can grow the business and keep that money coming in. And I love how you reference like those first couple years, you’ve got to know your numbers, you got to know your numbers, in the same way that you know, your craft, that thing that drives you to get into the business. Great. And we’ve got to be leaning into your cash flow, because that is the killer that we see that leads all of those statistics, you know, in businesses that fail. And so I’m really curious, you know, how do you think about, you know, the year for like, now, as a business owner, you’ve made it to your three, you know, your numbers, you’ve been following your cash flow, you’ve been building things out, what’s the sort of later step in that framework of growing your business, something that you see, perhaps a lot of business owners struggling with?
Donald Miller
Well, we can stay on the subject of cash. I mean, they’re, in the end, how to grow your small business, there’s six things that I help you figure out that cause 65% of businesses to crash. And it’s a shame, because they are just the easiest things to fix. First is leadership. And you reverse engineer three economic objectives. And I like three, because the human brain has trouble prioritizing any more than three. The sixth thing in the book, the sixth framework in the book, I think, would be really helpful for everybody listening. And that is you need to operate your business using five checking accounts. And I’ll tell you what those checking accounts are, they are your operating expense account, all of the money that you make, pursuing those three economic objectives are gonna go into your operating expense account, you are then going to pay yourself every two weeks a salary, yes, you are an employee of the company that you also own. And it’s kind of important to think of it that way. I am an employee of a company that I also own. But you want to separate yourself as an employee. And so let’s say you’re gonna pay yourself, I don’t know, you know, $60,000 a year. Alright, so you’re gonna give yourself $2,500 Every two weeks out of the operating expense account. So now you have two accounts, you have an operating expense account, and you have a personal checking account, crazily, so many small business owners never separate it, because they see themselves as a business and they’re literally pulling personal money out of the operating expense account. And that will kill you, you will not live, you will not survive if you’re doing it. So at least two accounts. All right. Now, there’s a third account. And the third account is taxes. You all of a sudden are responsible to pay your own taxes and nobody’s doing it for you. Well, here’s a pay too much. By the way, we’re all going to become anti tax capitalist here in about a couple of years. Watch it happen to you, it happens subtly. Anyway, your you know, what you’ve got to do then is every time you pay yourself 2500 bucks, and please, if you’re driving, pull over because I’m about to I’m about to make you lose your minds. Every time you pay yourself $2,500 You literally have to put $2,500 into the tax account. Because whatever you pay yourself, you’re gonna match to the United States government. Isn’t that crazy? Now, you’re only going to pay about 37% By the time you finished, you know using money for health benefits and property taxes and all that kind of stuff, that tax account is going to start depleting pretty darn quickly. What that will do, though, for you, it will, it will make sure that you’re never surprised by a tax bill, I would say probably the number one or number two reasons businesses run out of money is because the IRS comes knocking. And we spent that money on a bounce house for our child’s birthday party, we should have been putting it away to pay the government. So already we have these really clear optics, we have clear optics on how much money the business has. We have clear optics on how much we have. And we have clear optics on how much money we have set aside to pay the government. And we’re never surprised by anything. The truth is, though, you’re not going to have to pay 50% of your profit in taxes. And so at the end of the year, that tax account is going to have extra money in it and you get to move it back. Now here’s the handout. That’s the basic three checking accounts that you can use to run a business, let me give you two more. The next one is called business profit. And what you’re going to do is out of your operating expense account, anytime it has a lot of money in it, like too much money, you don’t need this money in the operating account, you’re not going to pay yourself, what you’re going to do is you’re going to take money off the top, and you’re going to split it between business profit and taxes. So let’s say it takes you $20,000 a month to run your business, you look and you’ve got $40,000 in there, you don’t need $40,000 The operating expense account and you know what you need to do with it, get it away, get it away from you get it away from the business, so you’re not you don’t have access to it. So you take the extra 20, you put 10 in taxes and 10 in business profit, any money, here’s a quick rules, any money you put in your personal checking account, you have to match in your tax account. Any money you put in business profit, you have to match and your tax account. Now, here’s where it gets really cool. You want in your business profit account, you want six months worth of overhead in that business profit account. So if I’m at $20,000 a month overhead, I want $120,000 in my business profit account, because that’s my rainy day fund. Now, this is where it gets really fun, Natalie, let’s say you check your it’s gonna take a long time for you to save up 6x you’re operating, it’s going to take a year, maybe two years. But one day, you’re going to look at that account that’s going to have $200,000 in it, you’ve got $80,000 over what you need as a rainy day fund that money then transfer to your final account. And that account is called investment holding. You do not have to match money that you put into investment holding in your taxes because it’s already been taxed. You put that in your tax account when you put it in there. So you put $80,000 in investment holding and guess what you get to do with investment holy, anything you want. It is your money. Now the reason I want you to call it investment holding is because I don’t want you to spend it, I want you to actually invest it. I want you to fund a SEP IRA, I want you to buy stocks, I want you to buy a duplex if you need to. And in your heart of hearts if you need to go buy that albino Tiger. For the parakeet that says cuss words in other languages. It’s very expensive, you can but I wouldn’t do that I would go by I would go by, you know, financial products that make you money, that what I just shared with you, I realize it might be a little confusing. But if you’ll just rewind the podcast, and listen again and again, and write down the names of those accounts. And let me tell you what they are operating expense, personal checking, tax, business, profit and investment holding. Those are your five accounts. If you use those five accounts, to run your business, you are incredibly less likely to run out of money. Also, you have learned what the most wealthy people in the world have figured out. And the most wealthy people in the world have figured out that the business they own exist to buy financial products that pay them over and over and over again. With an end by the way, you won’t even have to work. If you get a million dollars in stock portfolio, it’s going to pay at least 5% a year. So now you’re making $50,000 a year without having to work every single year for the rest of your life and the rest of your kids lives. So you know you those sound like crazy numbers, but they’re not you have no idea how big your business is gonna grow. But you starting those five accounts and I teach you to do it in chapter six of the book, I actually show you how to do it. And it’s not that difficult. It’s going to turn running your business into a video game. And you’re gonna start seeing those numbers and you’re gonna you’re gonna want to win. And that’s, that is going to drive you to grow your business bigger and bigger.
Natalie Franke
The gamification side you’ve got me on that point. that i It’s true. It’s very, very true the moment it starts to feel gamified I’m like I’m in and that competitiveness, right? It’s that’s exactly
Donald Miller
that drive that drive.
Natalie Franke
Yes. Okay, so one question that I have in your journey and kind of the success that you’ve had, and you’ve done so many things. I mean, truly, like so many things. Looking back, if you were to talk to dawn on day one, okay, if you were to go back, and give yourself a little bit of advice, when you know, you first were kind of taking this leap and carving out a path for yourself that maybe was, you know, different from what the majority of folks were doing, going and getting, you know, a certain type of job or maybe, you know, at whatever point your journey you want to choose here, go for it. But to go back to an earlier moment, what advice would you give your younger you What would you tell yourself, then?
Donald Miller
Well, I would go back to myself, let’s see, about 14 years ago, I lived in Portland, Oregon, my wife and I live in Nashville, Tennessee now, but I lived in Portland, Oregon, I was a bachelor. I was a writer, I wrote memoirs, and I happened to write a memoir, or a memoir, if you’re, if you’re fancy. I wrote a memoir. And it ended up on the New York Times for 42 consecutive weeks, it was an insane season, and I made a ton of money in royalties. And what I did with that money, because I didn’t want the money, I didn’t want to I didn’t want to have it around, I would do stupid things with it. So I just paid off my house, I just took all the money I paid off of a condominium and in Portland, Oregon, when I didn’t have any debt. And I found another house that I wanted. And I ended up selling my house. And between me selling my house and getting the money, and being able to buy that other house, the other house sold. So now I’m just sitting on a pile of cash, it’s my entire life savings, the chances of you writing two New York Times bestsellers that go for a year are almost zero. So I knew this is never gonna happen to me again, this is the money that I’m going to make. And I ended up making a short term investment. I put all of my life savings, all the money that I paid off my house into a short term investment. And on a Monday morning, 14 years ago, I woke up and the money was gone. Every penny of it, I lost it all. And it was, you know, arguably, certainly career wise, the hardest day of my life. And not only that, Natalie, you’ll appreciate this, I think your listeners will appreciate this. About two weeks before that happened. I started dating a woman who is now my wife. Now, you know, we could take a poll with your listeners. But I think women are kind of attracted to good looks. I think they’re attracted to strength. I think they’re attracted to money. I only had one of those things. I only had the money. And I just lost it. And I thought, oh, man, you know, so it was it was an unbelievably, unbelievably painful Day. And probably for a few weeks, I was desolate. If I could go back in time on that Monday morning, I would probably pull up a chair next to my bed because God knows I wouldn’t get out of bed. I would say, Don, this is the best day of your life. I promise you, it’s the best thing that has ever happened to you. I promise you that you will you will look back on this. And you will say career wise, career wise, this is the best thing that’s ever happened to you. And the reason is because I finally decided to take responsibility for my life, my finances, my career, my money, everything. And I said, the chances of me getting back. And making this money ever making this money, again, are very, very small. But I’m gonna take the shot. And I let my manager go. I let my literary agent go. I let everybody go. And I said, I’m not going to be a guy who depends on a literary agent or a booking agent, or any of that I’m going to Donald Miller is going to be a company. And that company is going to grow. Now that was about 14 years ago, I think I don’t think it was 14 years. It was probably 12 years ago. Today, my wife and I give away the exact same amount of money that I lost that morning, every year. Wow. Year after year after year, we give it away. Wow. And that happened because of what everybody listening to me has done and is afraid of. Because you took responsibility and you said look, I’m not going to work for somebody else or I’m going to start a side hustle. I’m going to own some of my own career in life. And even though it’s hard, and it’s a struggle, it’s the best thing. It’s the best decision you’ve ever made. It really is. You’ve just got to do it right went the right way. You got to build it the right way. And you know Listen, I made 1000 mistakes, I did six things, right. And I put those six things in this book
Natalie Franke
that makes it incredibly accessible because I think I have probably done an equal ratio to that as well.
Donald Miller
To six, running, running numbers,
Natalie Franke
it does. But again, I, you know, interview after interview that I do, it’s so fascinating to me to just to hear how many folks that today have had so much success, and you see where they are in their career, and you see the business that they built, and you see what they’re doing. And it’s just, it’s it’s captivating and inspiring. And also just kind of shocking, right. And yet, when you peel back that curtain, and I asked them to kind of share to an earlier version of themselves. Time after time, we’re hearing about the valleys and the struggles and the moments when everything had fallen apart. And yet, they kept going and yet you kept going. And, you know, I do think there’s something to be said for the fact that a lot of the best things that come in our lives and in our businesses, often are brought about by seasons of growth of pain, discomfort, challenge, everything falling apart in our lives. You know, on a personal note, five years ago, I went through brain surgery to remove a benign brain tumor. And I was you were talking about, you know, speaking to yourself on that morning, when you couldn’t get out of bed, I vividly just thought, you know, for me that was those first state couple days before surgery in those first couple days after surgery, and just this, this deep darkness, this feeling of you know, recovery and uncertainty and struggle. And yet, I am not the same person that I that I was before that experience, I am completely transformed by those challenges completely. And in my mind, I would hope made better made more empathetic, I care more about about certain things, I fight for certain things more, my heart has widened quite a bit, you know, it softened me but also strengthened to me. And I think that, you know, in hearing your story, it just reminds me that it reminds me of the fact that for a lot of folks listening, you know, we started this off by talking about recession, uncertainty, challenges, hardship. And yet, and in the same breath before we even concluded the conversation, it’s like, the good that can come from those challenges, right? Yeah. So I would love to just hear from you. You know, with all that good as well, I know, there have been some bumps we just talked about one of them. Looking back is there, you know, any advice that you would give to help someone to navigate, you know, the mistakes that are inevitably going to come with the growth season. So we’ve talked about like how to get there getting your numbers in order, sticking with the cash flow conversation, or expanding beyond it, now you have growth. Now all of a sudden, things are taking off, you’re seeing scale in the business, maybe you’re hiring folks, you’re stepping into a new leadership role. I always say often, we’re the meanest bosses we will ever have. And then you hire somebody else. And suddenly you gotta navigate how to not be as mean as you are to yourself to that other employee that you brought onto the team, which is a great lesson, but you hit the growth phase, you have a little bit of scale, you’re expanding. And now there are new challenges. Now there are new hurdles that you have to come up against any advice to those any mistakes you see a lot of folks making in those gross seasons that you can help us avoid.
Donald Miller
Yeah, you actually mentioned it early on, you mentioned this desire to be liked, and to have people like you and sort of be a people pleaser. I think most of us have that. I certainly had had it. And still to some degree habit. When you grow and your business is growing, what you’re going to deal with more than you used to deal with what you’re going to deal with their people, you’re going to have team members, you’re going to have more customers, you’re going to have more vendors. And so 90% of success in business is just good people skills. And so let me give you just one paradigm shift that I think is super helpful. If you are more interested in being respected than you are in being liked, you’re gonna go further. If you are more interested in being respected than you are in being liked, you are going to go further. Because what it takes to lead is it takes people respecting you, it doesn’t take people liking you. Now if you’re mean, if you’re a jerk, you’re going to lose respect. Never, never lose respect, but be willing to let go of being liked. Being be willing to walk into a room and say, Hey, listen, you know, we said we were going to do this this month, and we didn’t get it done. And I can’t let us get away with anything except for excellence. I just can’t do it. I want more for you than that. And I want more for us than that. And I want more for our customers than that. What you’re gonna get out of that room is respect. You’re going to get respect. And let me tell you the biggest waves the biggest paradigm shift I’ve ever had in terms of learning To be somebody who’s respected. The, the number one person in my life who disrespects me, literally says things to me that are dark. And mean, is me. It’s me, I’m going, this is, Mel, are you gonna pull this off? You’re such a loser. What are you thinking? Oh, it’s me. And what I had to do is I had to actually when I realized I was doing that, I had to say, hey, to that voice, that voice inside you. And I realize this is a weird conversation, because we’re talking about ourselves talking to ourselves. But you kind of have to stand up to that voice and say, Listen, you don’t get access to too much is dependent on Don Miller, pulling this off, because Don, Don’s got employees, Don’s got a family, you don’t get to talk to him. That way, you don’t get access. And what I found was that immediately that voice back down. And so if you want to be respected, respect yourself, because that’s where it starts. Don’t ask anybody to respect you, until you can respect yourself. Because when you respect yourself, you show people how to treat you, you show people how to talk to you. So don’t expect other people to be all nice to you and to think of you as a trustworthy, respectful person, if you don’t think of yourself as a trustworthy, respectful person. So we gotta fix what’s inside of us. And that voice that says you can’t do it, and you don’t know what you’re doing, we got to fix that voice before we can actually earn the respect of a team. But if you do that, if you do that early, and it’s very easy to say, you know, whenever you’re talking negatively, yourself, just say, Hey, buddy, you don’t get access, right? If I call you, Natalie, if I called you once a week, is it I don’t think your business is going to work. And I don’t think your podcast is very good. And I, you know, I don’t think your hair looks very good today, by the way, you would you would take that call once, and then you would never take that call again. You would never pick up the phone. Correct. Donald Miller does not get access. So if somebody who treats you that way doesn’t get access, why are you giving access to yourself? You don’t have to. And that was a huge lesson for me. And we all have to make that transformation, if we want to be good leaders.
Natalie Franke
I love that so much. And a little, a little bit of inspiration for the parents out there. There is a song that Snoop Dogg has released, that is called the affirmation song. And what I’m telling you, you got to play, you got to check it out. We play it, I play it with my son every day on the way to school, and it is all about affirming who you are, and speaking kindly to yourself. And so there’s a lot of negatives, there’s no one better to be than myself. You know, and it’s just like, it sounds so simple. Yes, of talking about it for a toddler, but yet, you’re 100% Correct. We speak to ourselves in oftentimes just speak to ourselves in a way that we would never allow anyone else to speak to us, right in ways that are dark, they’re dark, horrible, horrible, and, and yet our words have power. How we speak has power, not just externally, but like we’re talking about, most importantly, internally. So decide how you want to wield that power, you’re going to wield your power to tear yourself down, or you’re going to wield your power to actually lift yourself up and embolden yourself to go out and to do the incredible things that only you can do. As we close out this podcast, as we wrap it up, I always love to ask one question, and I am on the edge of my seat. excited to hear your answer. Don, what do you believe is the biggest thing that differentiates the businesses that succeed from the ones that fail?
Donald Miller
Yeah, the businesses that succeed, learn from their mistakes? That’s it easy, because you’re gonna make them. But if you can actually say, Hey, why did we do that? How can we never do that? Again, you’re gonna make it. And a mistake is just an education. It’s an um, you know, you didn’t ask for the education, but it’s going to come at you anyway. So if you can, if you can be, that’s what I think that’s what resilience is. Resiliency is just learning from your mistakes at all. That’s all it is. And you find me any successful person, and they’re standing on a pile of failures. They are. And if you can learn from them. Yep, it’s not it’s not the end of the world. Give me a break. It’s not the end of the world. Yeah, if you make a mistake, it can be a lesson. So learn from your mistake.
Natalie Franke
I love that. Thank you so much for joining us. I doubt that our listeners are going to want to find you and order your book and discover all the incredible offerings that you have. So before we close, close everything out, Todd, if you could just share, you know, where can folks find you? And how can they get their hands on your brand new book that just came out?
Donald Miller
Yeah, the book is called how to grow your small business. I’m more proud of this book than maybe any book I’ve ever written. And it’s already sold more copies than any book at this point that I’ve ever written. So it just tells you how much people need practical, practical, practical. Yeah, just tell me what to do. So this thing doesn’t fail. And I do a lot of that in the book, if you will. My, my my plan my six part plan to grow a business you can actually download it for free. It’s at small business flight plan.com. So the whole thing runs with the, the metaphor of an airplane. So if you just go to small business flight plan.com I’ll teach you to fly business really, really
Natalie Franke
far. Amazing. Thank you so much for joining us that way. Thank
Donald Miller
you. It’s a pleasure.
Natalie Franke
That ends our episode of The Independent Business Podcast. Everything that we’ve discussed today can be found atpodcast.honeybook.com. Head to our website for access to show notes, relevant links and all of the resources that you need to level up. And if you’ve enjoyed today’s episode, be sure to subscribe to the podcast so that you never miss our future content. Drop us a review and leave our guests some love on social. Thanks again for listening.
