Today we’re going back in time with Neil Patel. He's been on the show once before, but that was six years ago. A lot’s happened since then.
Our conversation goes back to the very start of his business, era by era, back and forth. It’s not really an interview, but more of a conversation about how business has changed, how marketing has changed, why what worked before doesn’t work anymore, and where things are going.
We finish this conversation with probably the most epic piece of advice you could ask for when it comes to starting something new and seeing results. Make sure you stick around for that!
All of this, and more, on today’s episode of the Smart Passive Income Podcast.
Neil is a New York Times Bestselling author. The Wall Street Journal calls him a top influencer on the web, Forbes says he is one of the top 10 marketers, and Entrepreneur Magazine says he created one of the 100 most brilliant companies. Neil was recognized as a top 100 entrepreneur under the age of 30 by President Obama and a top 100 entrepreneur under the age of 35 by the United Nations.
- Neil’s website
- SPI 214: How to Master Content Marketing with Neil Patel
- Follow Neil on Twitter and Instagram
- How long it takes before businesses start hitting their stride
- What causes many entrepreneurs to lose focus in their journey
- A hiring trick that can dramatically increase your chances of success
- Current trends in video content to keep your audience engaged
- Tradeoffs between having a team and doing things on your own
- Neil’s recommendations for what to focus on in 2022
- How to expand your reach and grow an audience when first starting out
SPI 561: How Marketing Has Changed, and What’s Working TODAY with Neil Patel
Before, I would just hire and try to find people, plug them into the role, and get things done.
I’ve shifted over the years; I try to hire people who have done exactly what I’m looking to do multiple times before and did it successfully. That was game changing to me.
I wish I knew that from day one.
If you know anything about me, you know I love traveling back in time to discover new things, not just sit in front of the TV and watch Back to the Future.
But today we’re going back in time with Neil Patel.
Neil’s been on the show once before, but that was six years ago. A lot has happened since then.
We actually go back even further to the very, very, very first start of his business. We kind of go era by era. We both go back and forth. It’s not really an interview, but more of a conversation about how business has changed, how marketing has changed, what has worked once before doesn’t work anymore, and where are things going.
We finish this conversation with probably the most epic piece of advice you could ever ask for when it comes to starting something new or taking the thing that you started and actually seeing some results. Make sure to stick around for that.
Neil Patel, a great friend. An amazing, amazing marketing mind.
I’m so jazzed he’s here today. Again, welcome to the session, and I hope you enjoy.
So, here he is, Neil Patel.
Neil, welcome back to the Smart Passive Income podcast. It’s been it’s been a minute, for sure.
Yeah, it’s been a while. A few years, at least.
I looked, it was six years ago. You were on the show in episode 242. A lot has happened since then on my side, and a lot has happened on your side. A lot has happened in the world.
I want to talk about the world today and what you’re thinking about. Because you always seem to be on the forefront, and ahead, and advanced as far as what’s coming.
But a lot of audience members who are listening right now might not know your history. And also even my history in a way, and kind of where we came from. Because we are kind of like two old geezers in this space now.
Why don’t we just chat about the past and the way we were thinking about growing our businesses.
We’ll end up to today, and see where we end up next. Are you’re down to have a fun little reminiscent Back to the Future episode?
Yeah, let’s do it.
I remember when you first started out, I don’t know how many people you have now, but you have a lot of people. When you first started, it was just you for the longest time.
For the longest time.
Yeah, it was. I was editing everything, publishing everything. I was doing all the graphic design and stuff. It took me six years to get over the fact that I shouldn’t do everything myself, and I’m not the best at everything. I only wish I did that sooner, found help sooner.
Did you always know when you started out that you were going to eventually build a team? You have a massive team as well? How how soon until you figured that out?
From the early days when I first started out, I had people early on nowhere near the amount of people I have today, but, I was a big believer in hiring to scale. But yeah, you don’t really have a choice, right? Like when we first started off, we would do whatever we could Both didn’t have tons of money.
We just started grinding it out, hustle, figure out, getting results, make more money, pay the bills and going from there.
What year did all this online business stuff start for you and just.
Yeah. So for me it started. 20 2002, 2003.
Yeah. So you were even earlier than me, cause I started in oh eight after I got let go. So tell me about, tell me about the wild, wild west of the internet in 2002.
And what were your first projects? How did you, how did you begin to start figure things out back then? There wasn’t even YouTube back then.
No. And, there wasn’t Facebook either back then.
My space during my times when I started my space is blowing up and then they sold and everyone thought that was ridiculous. But my first month was a job board. Believe it or not, because I couldn’t find a job. So I created my own job board,
How did you build that?
I paid some people on a form called web hosting talk. I don’t even know if that exists anymore.
Never even heard of that.
Yes. So then did that. couldn’t get traffic to it by paying some marketing firms, lost all the money. had to learn it on my own, gotten good at marketing, but back then, it wasn’t tough. Like you put in keywords in the title tag, you build some links and then you would pop up to the top of page one really quickly.
And then even when I started getting traffic, I was generating no road.
And that didn’t work out, but eventually I switched over into consulting and that was my first real business quote unquote,
When did you consult about
How to grow your traffic, because that was the only thing I was good at. So it was the sake I’ll let me just help people do this and said, run home from school, pick up my phone, cold call all the people that are paying for the paid advertising on Google and try to convince them to hire me on a performance space.
If I got them traffic more traffic pay me. If I don’t don’t pay. And there is no real expenses on their end or risks expenses, you know, if I provided the results, but that’s how I started off.
So, what was the secret back then for ranking? It was, it was it literally just taking people who had no idea how to rank as far as titles and keywords and stuff. And just implementing that for them.
It was there wasn’t much more to it. That was it. Eating.
How old were you at this point? Like making money from the internet already? 16 dude. That’s insane. So.
You know, I don’t know about your family, but my family, very traditional go to college, get a job, you know, all that kind of stuff. How is this changing your mind about like the American dream and like the Path that we’re all told at 16, did you already make decisions about your future at that point and what you wanted to do and what you didn’t want to do?
Yes, but my parents are very traditional, like yours. My mom’s a teacher, so that didn’t go quite well. I was, I was doing well. I was doing 20 grand a month at 16, which is a lot of money even for today. Now keep in mind 20 grand a month at 16, I eventually lost it all. So it really wasn’t 20 grand a month because bad investments, poor decisions, not really spending it just poor business decisions more than anything else.
But yeah, so my mom and dad, I was like, well, I’m making more than both you guys combined. So why should I go to college? Not a great way to start off with your parents.
Did you end up going to college?
I did. I ended up getting a degree from Cal state Fullerton took me five and a half years. I had enough high school credits where it should have taken me two and a half years, but I was on the five and a half year plan.
So that took a little bit too long and, Kept us going after that things got harder. but out of curiosity with you, when you started off, I remember you started blogging and you had share your income. I don’t know if you still share your income, but he used to share income
I don’t like a report anymore with all the things. It grew to a point where they were actually pushing people away. Like, oh, Pat’s grown too big now. Or those numbers were never achievable. So I stopped them after I think, eight years of doing it every, every single. I mean, I still get people who come to me and say it was your income reports that drew me in it’s.
It was the transparency. Nobody was doing that at the time.
Yeah, because I remember seeing it years and years ago, your income reports were just well into the six figures, right? Over a hundred grand a month or something like that.
But I’m pretty sure it was over a hundred grand a month. or it was close and you could see the affiliate revenue that you were making from like hosting a and selling other stuff.
I think you’re like a food truck thing. I could be wrong on
That’s correct? Yeah. I had a food truck, niche website. I had a security guard training niche website. I built this little website to help people create a clickable map that they can then download and put on their website. all these little projects here and there, which were really cool and people got inspired by them.
I actually, there was a tweet earlier today that said, I had no idea what I was doing, but nine years ago I had got my first ad sense check, thanks to a website that Pat helped me build. And I was like, wow, this is like, this is pretty crazy, but it was it to me. It never felt. business, right. It was always like hacking my way, trying to make a dollar here, trying to make a dollar there and those dollars added up for sure.
But it took a while for me to get that, like, I’m going to make a business out of this. I’m going to be CEO of a company when you were 16. It sounds like you were maybe somewhat scrappy, but also already thinking ahead, in terms of hiring a team and actually building a business and such, where did, where did you at that time get most of your education and inspiration from?
Did you have mentors? Where did you learn?
No just trial and error. Yeah. I had some mentors, but most of it was trial and error. The big thing that I found is it took me, so I’m 36 now. and I’ve been entrepreneur for pretty much 20 years. but it took me a good 17 plus years until I realized how important hiring is. See, I always have.
I did not hire correctly before, and I’m not saying I hired correctly now, but the way I thought about it was very different before I would just hire and try to find people and plug them into the role and get things done. And I’ve shifted over the years in which I try to hire people who have done exactly what I’m looking to do multiple times before.
And did it successfully. Because then your chances of succeeding are much higher and your chances of failure are much lower and you get end result actually much quicker cause they know what mistakes to avoid. And that was game changing to me. But that took me just too long to learn. I wish I knew that from day one.
Yeah. I mean, there’s this, there’s a ton of things that are. I knew as well. I wish I knew more about the power of software earlier. I mean, I had experimented with that in, in 2010 failed miserably, but you’ve done very, very well with software. It was crazy egg, your first sort of big software thing that you built.
And I know that, you know, we had Heaton on the show earlier and he talked a little bit about that story, but was that your first foray into software?
First real one, but it wasn’t meant to be, see, we ended up, we had a website called site.
To be Google analytics, a free version of it. Well, technically Google analytics history, but back then urgent was paid, which is now Google analytics. Google bought a company called and renamed it to Google analytics and made it great.
And we’re going to create a version of Google analytics like you’re seeing now or urchin software back then, and just make it a hundred percent free. But Google beat us to the. And when we were creating Seipel and for like, Hey, we should create a spin-off product called crazy egg, the dishes, do the visuals and use that as a free pack and drive, driving more into Cipla.
And, we never launched site blimp. We launched crazy egg and it took a long time to grow it. It did well overall, you know, the business has been around well over 10 years, but what I’ve learned in businesses, when you give businesses. Three plus years you start seeing some traction, but it’s like usually a five-year mark where things really start hitting their strides.
That’s a long time to get to the point where you can see that. And I dunno, maybe that discourages people who are listening now, like for those who are listening for like three years, five years, like that’s a long time and I want results now, how would you respond to those?
Yeah, no, I’m with you on that. It can take, It can take a long time. If you, if you’re looking to get results really quickly, you’re going to be disappointed. If you’re a Patient, you can create something that’s life changing. You can be extremely happy, but you just have to be Patient I’m bill gates fast, and I’m going to butcher the quote people under, overestimate what they can accomplish in a year, but they underestimate what they can accomplish.
In 10 years. He has a quote somewhere around something like that. And it’s so true. And, the other big thing that people end up having the issue too, is when they know it’s going to take a long time, they lose focus and they do too many things. And because they do too many things, just the business doesn’t work out the way they want.
That’s a great point. And I love that quote. It sounds like you hit it. Right. But I don’t know what the exact quote is either. And that’s okay. But I think we get the point. let’s go back to, okay, so maybe now you and I are both starting to work at the same time. Now I started in 2008. You’ve been in business for a while at this point.
And in 2008, when I started, it was all about blogging. Like content marketing started taking a role. YouTube wasn’t really in anybody’s strategy. It was kind of a afterthought for me.
And podcasting wasn’t even necessarily around yet. Although I got an early on that, thankfully, but blogging was the thing.
I was blogging three times a week. And I know you had a, I think QuickSprout was around at the time and you are blogging there as well. What was your strategy for mastering the sort of blogosphere and having that work for you?
Yeah, it was, I was just blogging so I can generate traffic and I was having fun doing it. I was never trying to make money from the blog. It was just a fun place and a fun thing for me to do. I was trying to focus all my energy on software. at that time I was doing a company called Kissmetrics, which did not work out.
But yeah, it was just blogging for fun. Now, when you started blogging, You know, as following your journey, especially very early on you’re blogging and generating income and sharing your journey with everyone. But what was the main I’m gonna see? You don’t have to go back to work or
I mean. I didn’t want to go back to work, but it was mainly a way to share how my other businesses were helping. I had an architecture related business that was doing really well. And that’s what I was talking about because when I was trying to research internet marketing,
But you had an architecture degree.
I did. Yeah, I did. And I got laid off. That’s what started this whole thing. So I’m very grateful that I got let go. Although that day in that month did not feel good. it was a blessing in disguise for sure. But I was just blogging about this thing that so many people were asking about. How did you survive the recession?
Tell me how to build a website, show me how you are making money. Show me how you’re making sales. And I was like, I’m just kind of figuring this out as I go. I’m going to write everything I’m learning and. And that’s really what started to help people and take off, which is really great. And then the income report, I was the only meaning to do at one month because I just wanted to share like, okay, this is actually happening.
Look like here’s what I’m spending and here’s how much I’m making. And then everybody just was super stoked on it. So I kept going with it for a number of years, but, I didn’t even make money with Smart Passive Income for a year and a half. Actually. It was, it was not until. Dove into this world of affiliate marketing.
That was really the first foray into affiliate marketing for me was in 2009, 2010. And it was absolutely huge because I could just continue to share the things I was doing. But then just go here’s the tool I was using click my affiliate link. And that was, that opened up a whole world of income because there were many tools that I was talking about.
Search engine tools, blogging, hosting, and, and, and camera equipment, podcasting equipment, all that sort of stuff. Did you ever dive into affiliate marketing on your website? And if so, what were some of your like top products?
I did over the years, late, a few years ago, I started diving into affiliate marketing, but before then, not much. and most of them ended up being like hosting voiceover. IP does really well. Domain registration is okay. payroll, like stuff like that, like the old school B2B services
Cloud computing does well, but.I was never big on affiliate and I’m never, hadn’t been able to get a site to generate as much affiliate income that you, or, another one who does quite well as a John Lee Dumas, I think he still does.
He’s still doing.
Yeah. And, or say it from WP beginner. Like I never really cracked the affiliate, not, I think I cut or cracked it.
I just never focused on it.
Well, I mean, you had these other companies in the software and a consultation and other things I’ve met a lot of your team and you guys do amazing work. And the other thing that always stood out to me from you is you always seem to know where to put yourself in your content before even others do.
Right. I feel like you were pretty early to blogging. And then even in like the YouTube space, you were pretty early on, then you caught on with the podcasting and you’ve just been doing well with that. And you do, I’m curious. Cause I remember when you first started your videos, I mean this was years ago.
And they were very formulaic. I must say. I mean, you’re jumping across the screen and you’re in front of a white screen or something or a white background. And like the channel is exploded. It’s like, how long did it take for you to realize there was traction on YouTube and, and when, when did that even start?
Yeah. So you do my guess is three, four years ago. It could be wrong on the timeframe, but somewhere around there, started creating videos. A lot of trial and error at the beginning was really formulaic. Three minute videos.
Wasn’t working out. Some videos for were minute or even two minutes. still followed a specific formula, you know, intro to telling people to subscribe, to then telling people the meat and potatoes of the video, and then ending with a pitch like, Hey, check out my ad agency and a.
That’s an quite well, although it’s starting to not do as well. Funny enough, I record my videos in batches. So let’s fast forward. Three plus years, a YouTube channel had a million plus subscribers. We will, I’m recording a new batch of videos next week and I’m adjusting the. So think of it more like a TikTok style videos, right?
Where people are just throwing a lot of B roll and you’re not telling them, Hey, subscribe or click the alert notification or any of that stuff. And you’re just going into the meat and potatoes
And trying to use some humor, entertainment, at least with the editing to make it. So people keep watching and I don’t know how that’ll do, but we’re going to start rotating up and quote unquote, try the TikTok style, but in longer form video.
I like that TikTok style to me also means kind of a lot of jump cuts and different scenes and things to look at. I mean, this is the way, I mean, talk about today. The attention span of people is just getting shorter and shorter with stories and shorts and reels and all these things happening. It’s just like it’s it’s we really got to.
The eyeballs move in or else people will get bored and leave and move on to the next thing. So I like this experiment and I like that. I’m going to be paying attention to see how you do that. It has with the YouTube channel over a million subscribers.
I know that in our space, at least the RPMs, the revenue per a thousand views is pretty high.
Like how has the YouTube channel specifically been doing monetarily? Is it, is it like bringing you some good bank every, every, month now that you’ve been at it and consistent for so long?
I’ve never tried putting ads. I don’t know how much they generate
When you say they’re good. What is the rough ranges that they monetize that
I mean, $30
Yeah, bro. Put it on.
Like I’m at a million thousand, I’m three grand a month.
I think you could. I mean, I’m at about the eight to 10 on my channel, and I’m about a third of your subscribership and, and, you know, subscribers aren’t even really the thing that we need to shoot for it’s views. Right. Because most of your views today, unlike before. Are coming from people who’ve never seen you before.
Right. Which is why I think the strategy of yours to not say like, Hey, welcome back. I’m Neil subscribe, and then get into It It’s like, people don’t even know who you are yet. You haven’t earned the ability to like, get that subscription yet. So I like that because most views are coming from people who’ve never found you before, but dude, you should just, I mean, turn on ads and see what happens.
I’ll split the revenue with you. If you want. Since I.
Oh, I don’t think I’ll turn on ads. It made like a million dollars a month. I’d probably do have a.
I might try to convince you otherwise down the road, but I respect that.
I respect that. I mean, you have your, your ad agency, right? You said these videos are pointing to your ad agency. Tell me about the ad agency and what work there is like now.
Yeah, sure. So the ad agency was created we’re on our fifth year. I remember we ran into you at the WIWORK and downtown San Diego.
So a 50 year, it is. It’s the fastest growing company ever created. we were number 21 on Inc. 500 list last year.
Wait ever created like anywhere, not just like that you’ve ever created.
I don’t know that I’ve ever created. Not I, someone else’s
Oh, okay. Okay.
Faster growing companies have this, but for me, this is the fastest growing company. we ended our fourth year with 640 employees or something like that. Something I think by the end of this year, we’ll be at 900 to a thousand. Is my rough guess.
How do you and your CEO of the company?
I am not
You’re not yet. What’s your position.
I think my official title is CMOs.
I think the title is irrelevant. I don’t
On a daily basis.
That means you’re not necessarily running the show entirely.
At all. I don’t run it at all.
Was it that way from the start?
My co-founder Mike ran it. I think you met him.
Yeah, Mike’s cool. I like
So he ran it. He, he moved from San Diego to Vegas, and the ad agency, we have the brand from YouTube, the content, all that people wanted to pay us for consulting and we never did it. And then we finally turned on that faucet. And I think the first year of business that we were in, we did $5 million in the first year.
And then we doubled the next year, the year after we grew at a much bigger, multiple than double. and then even last year we doubled over the previous. I skipped a year where we really grew because then people would know our numbers,
Right. Yeah. Wow.
40 people. Right. So then.
I mean, that’s a huge, that’s a, that’s a big company. to me in my head right now, just managing, you know, 10 to 12 is already a lot but like 600. That’s that’s insane. How does, like, I can’t even fathom that that’s, that’s like a large corporation feel like you know, how does that, I don’t even begin to understand.
I don’t even know what questions to ask honestly. who, who, who is your client? Tell me about your client. What are they like?
Yeah. So our client is like, Cisco, you know like we do work for Cisco or signify or Western union, or FTX the crypto company, or like a dope, most of our clients are like really large corporations.
And you’re helping them
Yeah. Like we’re in a pitch right now, RFP for an airplane manufacturer. I don’t know if the RFP lets me name the company.
That I am, but but like, there’s not too many airplane manufacturers, right? The chances are you flown on their plane.
And so what is the ad agency do? You’re literally managing their ads for their products.
SEO pay-per-click Facebook hours, all social media ads, organic social email CRO, but anything digital. So like, we’ll even do, you know, things like Hulu ads, we’ll pretty much do any type of digital marketing for companies creating content, like whatever needed to really help them scale. And.
Give me a sense of, so these larger corporations, right? How much ad budget, for example, are you able to handle?
Right. You know, you get a fee and you get a payment right. For, for the agency such, but like, I’m sure they give you a pool of money to go okay. Here. Or maybe you recommend a particular dollar amount to spend, to have them do what they want to do.
Like how many dollars are we talking that you’re spending on ads and. On like a company in general.
On a monthly basis, or let’s say client basis. We have some people who barely spend any money on ads, like a hundred, 200 grand a month. And then we plan to spend over $10 million a month. Literally like we have companies like one company will spend, well over 10 million. We have quite a few of those. So it’s like, we’re not at nine figures a month in ad spend management, but we’re getting up there.
That’s crazy. Do you, as a company, I know it’s different for every company and sorry if this is too invasive of a question, but are you, are you charging like a percentage of ad spend for you are, and then at tens of millions, I mean, you can do the math, right. Geez. That’s crazy. So what,
Yo and then all the services, right? So it was presented as in plus services.
So what is it like now that we’ve had this chat of like where you came from in the software that you built and some of the hustles that you had to now running this agency?
You prefer it, you do you like it? I mean, obviously the money’s there and it’s better, but like honestly, how do you feel about being sort of a CML at this like larger company now versus what it was like back in the day when we were kind of just playing scrappy entrepreneur.
What I quickly learned is your company is not really your company anymore. It’s a company pretty much. That’s run by everyone, all your employees. Aren’t really employees. They take part with a company. It becomes like a independent organization. Right? So even though my ad agency is called Neil Patel, digital or NP digital, for sure.
It’s not really me anymore. It’s a corporation. And I know that’s funny to say, but when you have like two or three people, it’s like, Hey, we built this company. It’s no longer that feeling. It’s just like you’re, and we’re not really big yet compared to like a Microsoft or apple or anything. We’re so tiny, but it just becomes like, a number, right?
Like you’re just the organization. Best way to describe it is as we started expanding internet. So we have us, we have someone who leads up Canada. We have someone who leads up, Brazil, leads up India, Australia and the UK. And we’re adding, I think, nine more international regions this year. Right? So we have to find leaders who can head up like that country.
Cause like, even people like places like India, most people say, oh, you have an India office house. Or it’s like, no, if you saw how much venture capital and money is being poured into India companies, there can spend an arm and a leg. So we’ll have a division that just services. But I was talking to a guy, A few weeks ago and he’s like, Hey, I’m Dan.
And I was like, Hey Dan, what’s up? He’s like, yeah. I run Australia for you. I was like, oh, cool pleasure to meet you. Like, how long have you been here? He’s like six months. I was like, oh great. You know, but like you, and it’s not that I don’t want to know him. It’s just so many people. Like I was speaking at a conference in Utah a few months ago at a company called podium is their own internal.
And a few people came up to me and they’re like, Hey, what’s up Neil? And like, they acted like they, mommy. I’m like, Hey, how are you? I’m like, I’m so sorry about this. What’s your name? I’m like, bro. They’re like, and there was two of them Mexican like, oh, we both work for you. And I was like, oh, I’m so sorry.
And I spent, I’m going to got to know him, but. It’s really hard, like just in the United States, we’re hiring roughly 30 people every single month. Now you do lose some employees as well. So it’s not 30 a net plus. Right. Cause you’re also, you have attrition, in scale. So like it’s impossible for me to personally know everyone at this point.
And how do you feel about that? Are you fine? You’re fine with that.
I’m fine with, I have no issues at first. It was a hard thing to get over. I was like, ah, that doesn’t feel personal enough. That feels, but there’s just no way I can get to know everyone. but I do try to help, like some, one of our employees, I never met them, lost their house in a.
And, I won’t say their name, but they lost their house in the fire.
And I found out from someone on my team, I never met them. I didn’t even know this. And they were raising money on one of those sites, like the bees or something. And I gave him the whole amount of money I put anonymous. So I don’t know if they can see if it was me. I hope they can’t see it’s me, but will I still want to be there for my team, right.
To support them? Not just from a business side, but also personally. No. On the flip side, you have how many people now
That’s a lot that you and your percentages. I remember when he started off, it was like pure profit, right? How has it been for you going from zero to eight? And I’ve never managed tons of people.
So to me, eight is a arm and a leg where the people to manage on a daily basis.
I mean, I am thankful that I am not CEO right now either. I recently stepped down and I’m playing founder owner and kind of floater and creator that’s because that’s what I want to do. Matt on my team has become the CEO. However, I still manage and talk to people. And as far as like eating into profits, I mean, absolutely it eats into profits.
I mean, our employees are our number one, exponential, however, It’s able to bring me peace of mind. It’s able to bring me space. It’s able to bring me time back that I wouldn’t have had otherwise. And we wouldn’t have been able to reach or affect the lives of as many people if it wasn’t for the team. So I am totally okay.
Spending a lot of money. I mean, we’re talking high six figure range every year to have the employees on board, to be able to provide the experience that we want. And although the quote unquote margins are far less than when it was just me from the work that I’m doing and how passive everything like. I’m, I’m happier than I ever could’ve been, and I’m not burned out, which is the biggest.
And out of curiosity, and you don’t have to answer this if you don’t want, you know, I, I don’t need to know your numbers before you hired anyone, but let’s imagine you’re making X dollars before whatever the X was with no staff. It’s almost pure profit. In that case, when you hired eight people, I’m assuming your revenue did not go up by eight X.
Right. Did, did it go up substantial or did you not? Like, if you look at the profit you had, when you’re running things by yourself, right. That scrappily hustler way. And I don’t mean hustler that way. When you hire the people, was your profit in total still more is they were able to grow the revenue enough
So when you’re going backwards, not
He went correct it. The profit went backwards. My take home money went backwards. I feel like that that’s, I’m buying a shield against burnout. I’m buying with that money that was removed from my pocket, peace of mind. And the fact that the business now could run without me is also huge because I could move a different direction or maybe I get hit by a bus or something, and it could still be there and provide value and whatnot.
It’s, it’s an asset that could run on its own without me. And that to me is worth paying for what I’ve ever drempt. When I first started that. That I’d be spending as much money on team and, you know, not make like choosing to not make as much money in the end. No, but I’m grateful that I’m here now. And that is an excellent question because it really puts into perspective.
Well, why are we doing this? Right? It’s like, what do you ultimately want? I mean, more money is just. And I’m happy and satisfied with where I’m at now. And I have investments and other things in place. And I play adviser to a number of different companies, which is a new world. That’s opened up to me in the last few years, which I absolutely enjoy.
I don’t know if you do any of that, but it’s been really fun to be involved in other companies, but not have to like do the day to day.
So in that way, you know, building the team has allowed me to spend more time and spending more money on the team. And other things have been, enabled me to spend more time.
Building relationships and getting out there and going to events and creating these relationships that now have turned into dollars that I’m now earning in other ways that wouldn’t have been able to come out. Otherwise, if I was always just me, I wouldn’t be able to spend some of my brain space on other people’s companies. And now I’m an advisor. I own a share of those companies and I can dedicate some of my expertise and relationship, capital to them as well. So I feel like it’s come back in. Directly from profit, from hiring The team and it’s come back in many other ways.
Yeah, I, I think it’s well worth it. And the thing that. It’s hard for a lot of people to get through and their thought processes. The moment you have these people, you get more freedom, more flexibility. You can spend it with your family, or you can go on a vacation, which is hard when you’re a solo guy or solo one.
And then on the flip side, that you also mentioned as well, is if something wrong happened to you, you know, you have stability for your family, even if you’re gone. I would knock on wood right now, but there’s no one next to me that
On wood for you. There you go.
We both live a very long, healthy life. the other thing that I’ve also found too, is there’s a point where the money doesn’t matter as much.
Like everyone has this belief in notion that when you’re entrepreneur, like you need to make a million dollars a year or whatnot, it’s easier to just cut back on your expenses and live a normal life and have less stress than it is to try to play the game where like you have to hit a specific number.
And I think it’s an easier way to live life than it is to be like, okay, I have to reach these milestones. And I was like, I don’t got any investors. I don’t really have to. Let’s just live a chill, relaxed life. And if I hit him great. And if I don’t, at least I tried and it is what it is.
Well said, Neil, thank you for that perspective. I think that’s gonna help a lot of people to finish up here. You know, you have however many accounts you have in your ad business. Now you’re helping all these companies with their marketing. You’ve got to have a ton of data coming in that you understand what is working and what’s not working today like today in 2022.
And perhaps you have some knowledge about different places. Maybe the metaverse, I don’t know that we should be focusing on for the future of our businesses.
So. Can you extrapolate with the work that you do at all these companies and all the money that’s being spent for a creator like myself who has a medium sized team, or even a solo creator right now, what should we be paying attention to?
What is working right now that we could get access to? Because we don’t have tens of millions of dollars, but you could still infer from that.
So I think in the metaverse is going to be big, but that’s. Right. Like, think about that to create that experience where you’re shopping at Nordstrom’s mall or Macy’s without really being at Macy’s, like that’s an extreme example. That’s monetizeable or far off from that voice search it’s here. voice conference is booming.
Not enough. Marketers are focusing on it, but billions and billions of dollars, get it spelled boys’ commerce. So that’s something that markers need to pay attention to the other big one that no one’s really paying attention to is if you actually look at the trend. So I looked at Google’s ad revenue and Facebook ad revenue over time. And even during the 2008 crash, when you created your business, Google didn’t have a down. Digital ad spend has continually just went up the revenue, the cost per click, right? The revenue for the Googles, the Facebooks, the snaps it’s doing better and better. The cost is just going up for the business. The big thing of a listener is going to take away from this is figure out what you can give away for free.
That won’t cost you a lot that people find that’s very valuable that all your competition charges. That is the best mousetrap in marketing that very few people are focusing on, but they have to, especially if you’re small and medium businesses, because how else are we going to keep compete with the big corporations?
Now, a great example of this is we bought a tool called Uber, says for $120,000, put millions into it. I went a little too extreme and I don’t recommend people doing, going down. And we gave away what our competitors were charging a hundred dollars a month for, for free. Now I’m not saying my solution that I give away for free is better than what people are paying a hundred dollars a month for, but it was good enough where they’re just like, oh, I don’t have to pay a hundred dollars a month.
You know, a large chunk of people could get value for free. And the point I’m making is, is that grew organically word of mouth and it helped build a brand if you want to do well these days, it goes back to. Th the thing I have is everyone’s looking for brands what’s differentiating, you know, Everyone can copy you these days.
Brand Kylie Jenner did really well from Kylie cosmetics. Not because Kylie cosmetics has better products, maybe they do, but it did well because of her brand. So how do you build a brand? It’s hard for us to be stuff famous or Facebook famous or social media or blogging famous, but you know what the easiest thing to replicate is give away something for free that everyone’s used to paying for.
That doesn’t cost you too much. That will bring you all those eyeballs within your. And then monetize through other channels. We give away a lot of software for free, and then we monitor, and of course we have paid plans, but majority of it’s free and we monetize through consulting. Right. That’s an example on what I mean on the extreme basis.
Can’t really get any simpler than that. And I’m like trying not to re like, over-complicate this it’s not,
It’s just that free thing is right.
It has to be valuable enough. Like if you’re like, oh, I’m creating this ebook, that’s a hundred pages. I’m going to make it free instead of charging. When other people try it. People, I don’t really read those a hundred page eBooks in the first place. Some people will most well, so there’s not enough value there.
But on the flip side, if you ended up giving away something that everyone’s used to spending $10 a month for 20 or 30, like if Netflix was a hundred percent free, it would blow up. It already is big, but it would blow up even more because Netflix is free. Great.
A lot to think about.
What’s hilarious about Netflix’s model is, I wonder what would happen if they just made it a hundred percent free and they put ads in there, and then you can pay the money to get rid of the ads?
I mean, that’s the Hulu model, is it not?
Yeah. But Netflix has better content, right?
That’s my opinion though. Maybe other people would disagree with me on that, but I would say most people would agree that Netflix has better content.
I mean, Netflix, if you’re listening, Neil Patel’s ad agency kinda knows what they’re doing. You might want to reach out to them.
Neil, this was such a fun chat. Thank you so much for coming back to time with me, and here we are today. I love that piece of advice at the end for anybody who’s starting something or struggling to stand out.
What an amazing way to just go, “Yo, here’s this thing you’re used to paying for, here it is for free. Now let me help you with your next steps.” That just makes complete sense.
Neil, where can people go to find you, follow you, and see all your things?
Easy as that.
Neil, thanks so much for today.
I appreciate you. It’s always good to catch up with you. Hopefully we can see each other in person again soon.
I hope you enjoyed that episode with Neil Patel. Such a fun conversation.
Like I said, that epic piece of advice there at the end could be a game changer for you. It’s gotten me to think about different things that we could offer, that yes, normally are paid that could bring people in, get people talking, and get people to sign up for something else.
There’s a lot of potential there for sure.
Neil Patel, find him at NeilPatel.com.
Thank you, Neil. I appreciate you.
For our listeners, I look forward to hearing what you think about this episode. Give me a shout out @PatFlynn on Instagram or Twitter. Let me know what you thought about this conversation. You can tag Neil as well. Neil Patel, P A T E L.
If you want the show notes, and all the links and resources mentioned in this episode, head on over to SmartPassiveIncome.com.
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