Year-2 Entrepreneur Insights Pt1: $655k Value Mistake

Screen Shot 2022-12-23 at 10.12.42 PM

In May of 2022 Hotep Jesus visited Austin to be on Joe Rogan.

We had some great conversations while patrolling 6th street. I remember sharing how proud I was being a month away from my first 6-figure month….
I was wrong. $95,000/month wrong to be exact.

Earning an additional $5k/month isn’t bad, but in total, from June to today that’s a $665,000 total mistake. But more importantly, it’s a $665,000 indication of a lack of value.

Jay-Z cringe face at the thought of me making a financial mistake that could have made me 665,000 dollars over the last 7 months.

Thus my hiatus from posting on Men of Order. I had to make 100 mistakes, learn 100 lessons, to find the ways that did and didn’t work.

But now I return from my pilgrimage like Naruto ready to fight Pain with 6 new entrepreneurial insights. These are the 6 things about delivering value I would have taught myself in 2019 that would have saved me from more than a few ice-cube dinners.

Naruto returns from months of training as a Sage, to fight Pain, a main antagonist who just destroyed Naruto's home village. After winning he is crowned the hero of his village.

I’m going to share two of them with you today focused on delivering value to your customers.

Service vs Value

In a snowstorm, are you paying for a plumber to fix your water heater or are you paying for hot water?

Are you paying for hot water in a snowstorm, or are you paying to have that hot water right now, guaranteed to last for 30 straight days of snowstorms, if not, follow-ups are free?

You should have a dominant product and/or service. If it is dominant, then it has high value as it can deliver what your competitors cannot.

What increases the value is:

  • How quickly it works
  • The effectiveness of results
  • Does it bring in more $ than was spent
  • Does it increase status
  • Does it give them their time back

But to deliver value you must know who your customer is. All customers spend money in 1 of 3 ways:

  1. Freedom Fighters – money exchanged for the time to enjoy life
  2. Mountain Climbers – money exchanged for ability to do something great
  3. Craftsmen – money exchanged to have elite skills

Someone who wants hot water qualifies as a freedom fighter. Sell them the best freedom.

People will pay a premium for what they value (results) over hours of service.

A man pulling out his credit card to read the numbers for making an online purchase.

My Life Example

With Reykli I have 1-on-1 sessions with competitive swimmers but my customers are parents.

Luckily my product delivers on all fronts, but if I had to sequence the importance to them it would be

  1. Freedom fighters – pay to have kids have positive experience with swimming – success
  2. Mountain Climbers – want their kids to have the best results
  3. Craftsman – want their kids to know the best skills

The value that I deliver

  1. Their kid will be a “fast kid”
  2. They will swim faster than the families in their peer groups
  3. Kids will be more advanced/skilled than others
  4. Kids will make faster meets/time standards and be recognized as elite
  5. Coaches, athletes, and parents will acknowledge and praise them
  6. Kid will have a positive relationship with hard work and success

The kicker to this value is that I have not failed yet in delivering results, batting a thousand.

Of the 10 kids who have been with me for at least a year, 100% have made the top-200 national rankings in at least 1 event.

Of those 10, 7 have made the top-100. Of those 7, 4 have finished in the top-50 nationally. The highest being in the top-30.
With two kids finishing in the top-50 in 3 events apiece.

Sell the Hole, Not the Drill!

My marketing guy made me realize this with a few wise words. This was a key lesson that is to be used in conjunction with the sales fundamental: people act to move away from pain points rather than towards pleasure.

A man comes in needing to hang something on his wall. So we start thinking about the drill he can use and all its amazing features and how it can drill the best holes. He really doesn’t really care about how awesome the drill is, he just needs to hang something up.

Sell them the hole.

A guy having his mindblown in a startling revelation -- gif

His problem is that he doesn’t have a hole, not that he doesn’t have a drill.

Cue goosebumps.
Even right now typing this up, I get the same tears of joy that I got when he said those words to me.

We typically look at increasing value as the features included in our service and/or product. So when we try to increase value, we typically add on features.

WRONG!!

Your product/service is a solution. DISSOLVE it into every individual problem that plagues your customer that you can solve. Sell the hole, don’t sell the hole maker.

My Life Example

With Reykli my product is a specific system designed to develop athletes better than anyone in the world. When I added value to my 1on1 service to justify the price, I added 4-features to the service.

the price I charge for 1 on 1 swimming lessons for competitive athletes.

Adding all these features ultimately led to this blog post because of the additional work it created as my demand grew. I also found myself violating one of the 6-insights that I will share with you next week.

The value of Reykli is not 1-on-1 and 4 features. It is not that it’s the best in the world. It’s not even the solutions Reykli provides.

The value of Reykli is the problems it solves.

There are 2000+ swimming problems holding back athletes from achieving their genetic potential whatever that may be.

The common swimming solutions are the culprits. They directly solve popular issues without forethought of the ripple effect of the solutions, resulting in many other errors and misalignments when swimming.

I have simplified those problems into 25 solutions. When you put it like that, its value is worth way more than $459 for 2-hours.

Marvel Supervillain Thanos after gathering the final infinity stone and becoming all-powerful. This represents me becoming all powerful with the "sell the hole" philosophy.

Closing

Not realizing that I was selling the drill was the $665,000 mistake. Although I was very close, that short comment completely flipped my framing on everything.

Everything I wrote here about my Year-1 insights. This year’s lessons forced a re-evaluation with a new lens to analyze those year-1 lessons. My messaging was not resonating with them because I was talking about buying solutions instead of eliminating their problems.

Everything about Year-1 now is yielding results and the people I sell to are aware of how I can help them. My scalable automated solution, is now starting to print money while I sleep.

We all have or do something of value. 

If you are here reading this, you likely do way more than your job description. All of the roles you fulfill, likely solve 10+ problems. And even more when you run it up or down the chain of command.

This knowledge can be extrapolated into sales and marketing, negotiating promotions, targeting pain points, being persuasive, even the phrase “he doesn’t understand his/its/her value” should take on new understanding.

Know who your customer really is.
And sell the hole, not the drill.

You Might Also Like

Trending

Browse Topics

Archives

Crypto Trades