I always say the riches are in the niches, but that's not what this episode is about. Today I want to talk about exactly how big you should plan to grow your business.
Even if you're operating in a super niched-down space, you can still make the mistake of growing too big too fast. Why is that? It's because bigger truly isn't always better.
When we start our entrepreneurial journey, many of us want to become as successful as possible and as rich as possible. But here's the thing about big businesses: big means stretched thin. Big often means overwhelmed. In contrast, a small business can be optimized and refined to help you reach your exact economic goals.
So why take on extra work that isn't aligned with your mission? Why go down a path that can distract you from the vision you have for yourself and your family?
Listen in on this session because I want to shock you back on track today. This is the reminder many of us need in a world where we always compare ourselves to others!
Losing sight of the targets that drive us and focusing on what we don't have is a shortcut to feeling like an underachiever. So tune in for a perspective shift that will help you understand your journey and enjoy success along the way!
SPI 692: Why So Big?
Announcer: You're listening to the Smart Passive Income Podcast, a proud member of the Entrepreneur Podcast Network, a show that's all about working hard now, so you can sit back and reap the benefits later. And now your host, his favorite ride at Universal Studios is the back lot tour. Pat Flynn.
Pat Flynn: All right, we're coming off an amazing episode this past Wednesday, 691 with Donald Miller, one of my favorite people, one of my favorite authors.
He's written a book called StoryBrand, and his new book is all about starting a business and how to do that. And I highly recommend you check that episode out if you haven't already. But it's really made me think about this conversation that I recently had with somebody. And it was somebody who, when I asked them like what their goals were in their business, they said they wanted to be number one. And being number one is great, but if you are tackling a, I don't know if I should share the exact niche, but let's just say it's the equivalent of being number one in fitness, for example. Yeah, that's, that's gonna be very difficult if you're just starting from scratch, becoming number one in fitness.
Now, that's not to say that's not possible. That's not to say you shouldn't have very ambitious goals. But those goals have to be aligned with your whys and when we went into their, we, we do an exercise, which I talk about in my book, Will It Fly? we go through the history test, the Shark Tank test and all those kinds of things.
If you haven't read, Will It Fly? I highly recommend to check it out, but with my beginning students, I typically take them through this process and the airport test, which helps you go into five years into the future to think about really why you're doing what you're doing. Right. We discovered there was misalignment, true misalignment with where they want it to go in the next five years, and that ambitious goal of being number one in quote unquote fitness, again, it's a completely different industry, but basically as wide as saturated, right? Again, not impossible, but like really difficult, especially today, to go that broad and be number one in that space, number one, you definitely want to try to niche down as much as possible, and that's maybe where you think this episode is going, but it's not.
Many of you already know that the riches are in the niches. And where I want to go is even within a specific niche, in a niche, in a niche even, you can still make mistakes. And the big mistake is trying to grow so big so fast. And I wanna go into the origin of why, why is it that just we just think this way?
It reminds me of an episode that I did with Paul Jarvis, that episode was number 365. Yes. I know that cuz that's how many days there are in the year 365. So SmartPassiveIncome.com/session365 and it's titled Why Staying Small is the Next Big Thing with Paul Jarvis. Now Paul Jarvis is the author of a book called Company of One, Why Staying Small is the Next Big Thing.
And I love, I just, I wish I wrote that book because it's just such a wonderful take on the normal sort of energy that we have when we're starting a business, which is to be the biggest, which is to be the best. We, we, we wanna be as rich as possible. We wanna make as much money as possible. And again, I get that, but that makes it very difficult to feel like you're successful along the way.
And again, to my point earlier, and my student, it just didn't align with the why, right? If you really do an audit on your why's, why do you want to do what you're trying to do here? Do you need a multimillion dollar business or is that just something you think you need because everybody else kind of says that or, or talks about that, or that's what the media talks about.
Right? It's a fun, fancy number. I'm a millionaire. I've made million dollars in my business, and that's the first mistake that a lot of us make, which is we compare ourselves to others. So because when we're launching a new business or starting something new, when we're not close to that figure, we feel like we are a failure.
We feel like that success can only happen when you get to that point because we see and read and listen and watch all these success stories of people reaching that point "becoming successful". Now, on one level, and you know this already, just having money doesn't mean you're successful.
I know a lot of people who in, you know, actually in my book, I'm in a chapter right now that I'm writing about this very thing, A person that I met who was very successful on paper, they had the employees, they had the numbers, they had events. Going on. They were, they were loved, but they just were not happy.
And in fact, they were focusing so much on their work and their business that their family life was almost falling apart. So, again, to go back to this point here, comparing ourselves to others, we only see things at face value sometimes. It's not until you dig deeper or you learn the real story, or you go under the water and see the giant iceberg that's underneath that you truly understand what's all that that's happening there.
And the truth is when you see everything right, you're not just seeing the tip of the iceberg, but you're looking underwater too. You might not actually want that anymore. So comparing ourselves to others and determining what might be successful for somebody else, and using that as a barometer for our own success is definitely very, very dangerous.
I need you to define what success means to you. And so in this exercise, we essentially found out, this is, again, I've told similar stories like this before, but this was very recent. I, we ran the exercises, we ran the numbers, and we determined that success in this person's eyes was about a $300,000 a year business that would allow them to do what they wanted to do to reinvest em that into, they wanted to get into real estate as well, and that would help them feel fulfilled.
And I said, well, how far along the line of being the best in the industry does that get you? And it was very clear that that's not even like a, like a fraction of what it would take to be quote unquote the best in the industry. And so, you know, you can almost see it in, in his eyes when we were talking on Zoom, the realization, just that surprise moment of why am I working so hard to do something that isn't even really even where I wanna be?
So again, comparing yourself to others, not focusing on your goals. The other thing that often happens when it comes to why I wanna grow so big is just we're impatient. Now we live in a world where you can do a Google search and find something in an instant. Even now on Photoshop, with the Photoshop beta, you can circle a part of an image and say, add a cloud here, and boom, it just does it in an instant. You don't even need to know how to use Photoshop anymore. You just use generative texts. It's wild. This is like breaking news over the past week in the world of AI, and we just continue to be fed things that get us what we want faster. But when it comes to your business and entrepreneurship, success does not come that fast.
Success is not AI generated. Success comes from, Hey, I generated enough hours in this to learn about my audience, to focus on their, their needs and problems and pains, and to offer them a solution or more to help them solve those problems, right? So we have this unbelievable craving for now. And I think the most important thing is to figure out, okay, in this longer journey of business, before we even get to what defines success for us, we need to now figure out what the next steps are and now figure out how to learn around that and, and, and figure our way through that.
And for many of you, and this person who is in this space in particular that I was talking to my student, his now was we need to define what part of this "fitness industry" they wanted to corner. Right, and that's the cool thing. When you have a specialization in a space, oftentimes, and this is the beautiful part of this, you can have a proven market that's huge.
Find a subspace inside a subspace, inside a subspace of that, and you can essentially own that. You can specialize in it, and when you do, oftentimes you're going to find enough people to pay for or to have, be a part of your brand or community to support the lifestyle that you want. You know what the other part about this that comes to mind, while I'm just kind of speaking and jamming on this with you. This is why I love these Friday episodes. You and I can just chat here as if we're having a conversation together, and I'm being very rude because I'm not letting you speak, but you're just listening on a podcast, so you don't really have the opportunity to speak, but I'd love to hear from you and if you happen to be inside of SPI Pro or the All Access Pass, we would love to hear how you're doing and, and kind of catch up with you.
So make sure to check us out there if you aren't in any of those things. By the way, everybody in SPI Pro, remember, you also have access to the All Access Pass already anyway, but SmartPassiveIncome.com/allaccess or SPIpro.com. Anyway, the other part about this is that we feel money is going to solve our problems.
The truth is you can likely find happiness right in front of you. It's just a different mode of thinking, right? Just because you have the money, it doesn't mean it's going to to help. Now money can buy you things and get you things that can offer experiences that can make you happy and and do things that can make you happy.
Absolutely, I'm not gonna pretend that's not true, but you can be happy with a lot of times with the things you already have access to. That reminds me of when I went to Ghana, Africa in 2015. I had brought Caleb, my videographer and partner on the SwitchPod with me to film it, and we were building schools there through Pencils of Promise, an amazing organization.
I still support them. They're wonderful. And we had gone to visit a couple of the schools that we had actually, and by we, I mean you and me, my family and the SPI community, we had paid to have two schools built. We were able to go there and see them being built or see them already built or break ground on one of them.
It was really amazing. And I remember like this is like literally in the middle of Africa, in the middle of nowhere and seeing these schools pop up, but then seeing these children just so excited and they were playing in the playgrounds with no shoes, just a ball and some sticks and the dirt and that's it.
And they were so happy. It really brought to perspective what I was complaining about in my life and how just obnoxious I was making things that I was taking for granted. So just again, one of those other lessons. And, and then finally here, this whole idea of just bigger is better, right? I don't know where that comes from.
It's maybe an American thing. We see it in our plate sizes at restaurants or fast food joints, right? Bigger is better, but honestly in my experience now, 15 to 16 years later after starting entrepreneurship. Bigger is not better. Bigger means stretched thin. Bigger means overwhelmed often, or more confusing or too many decisions to make.
Sometimes smaller is better. And smaller is tighter. Smaller is more refined. Smaller means optimized. So why are we always trying to grow so big? Right? Why are we always trying to grow so big we need to stop. I think that if every person listening to this had a well-defined niche, had a incredible solution to offer that particular industry or market, and just continue to iterate on it to make it better and better and better to become well known in the space, to not feel like there's even any competitors because you're so specialized in something.
It makes me think of the olden days where people lived in small towns and people had specialties, right? The blacksmith. Did blacksmith things. They weren't bakers. They didn't even know or even care how to bake because that was so somebody else's job. And when you learn from somebody, you learned from a master as an apprentice to then become a master yourself.
And I feel like we need to get back to those days, which I don't know if we're too far from that now, especially with AI and everything coming so quickly. But I honestly feel like AI and all these other things coming out will essentially, even the playing ground for all of us who have literal access to the tools and information that again, make us all on the same playing ground.
And it's the human connection. It's the nicheing down, it's the specialization. It's the personalization that's gonna help you stand out. It's gonna help you succeed. And bigger is not better. Bigger is not better. So that's my lesson for you today. Let me know what you think at @PatFlynn on Twitter or Instagram.
Hopefully this may be shocked to you a little bit into alignment with where you want to go and perhaps stopped you from going down a path you didn't want to and hopefully put you on a new one, maybe, that seems more achievable, that seems better positioned for you and your future and your family.
And I just wanna wish you all the best of luck. Thank you so much for today. I appreciate you. Make sure to go back and listen to episode 691 with Donald Miller. Incredible episode one of my favorite people, and you are one of my favorite people too. Thank you so much for listening, and I look forward to serving you next week.
Till then, peace out everybody.
Thank you so much for listening to the Smart Passive Income podcast at SmartPassiveIncome.com. I'm your host, Pat Flynn. Sound editing by Duncan Brown. Our senior producer is David Grabowski, and our executive producer is Matt Gartland. The Smart Passive Income Podcast is a production of SPI Media, and a proud member of the Entrepreneur Podcast Network. Catch you next week!