What to Do When Business Gets Really Tough

Growth Newsletter: https://levelingup.beehiiv.com/subscribe Need marketing help? Visit: https://www.singlegrain.com/ and https://npdigital.com/Want to recruit great marketers? Find them here: https://marketingschool.io/hire What do you actually do when things get really tough in business? Neil and Eric share their worst moments — 2020 included — and the playbook for surviving them: eating the elephant a day at a time, buying time with cash, and choosing stability over growth when it counts. Then the reveal that hot AI startups like Cursor quietly run thousands of ads at a time, and a five-star massage-studio case study on referrals, grandfathered pricing, and service details that carry over into any business. Key takeaways◾Tough seasons are survived a day at a time — systems over panic◾The hottest AI startups test thousands of ads, not two◾Great service businesses engineer referrals on purpose Chapters00:00 When things get really tough09:14 Stability vs growth15:56 The 6,400-ads reveal17:10 The massage-studio case study

• 0:00Speaker 00

  Finding customer information shouldn't mean digging through emails, call notes and spreadsheets. HubSpot Starter Plan brings all of those details together, so it's easier to track what's happening with every deal and what to do next. It pulls information from calls and emails. Then it gets to work, logging and summarizing them. Right after your call ends, HubSpot pulls next steps from your call notes and drafts suggested follow-ups. And it stays up to date for you, so you can build demand, win more deals and spend less time on repetitive work. Your records, insights and next steps are ready for you to act on. And you don't have to miss a beat searching for any of it. Try the Starter Plan for $10 a month. Learn more at hubspot.com. So I want to talk about one more thing, because I was talking to an entrepreneur today. And you know, this is a good topic, right? So what to do when things get really tough in business?

• 0:44Speaker 00

  So this is an entrepreneur and he's like, you know, I'm really overwhelmed right now and this and that. And I think about, we can share our moments where we're most overwhelmed, right? I think about 2021, I'll go, I'll go deep in here for a moment. We did two acquisitions, okay, everything started crumbling. We had a, a GM that was sabotaging the business, right? And so we're losing employees at the same, we're losing clients because of that sabotage that was going on. I had also, that's a very personal thing, I'll just leave it at that. But I have a personal situation to deal with as well. And so when everything was crumbling down, you know, I was like, man, I think I might just throw in the towel. Because there's a, there's like, you know, there's, there's like debt situation as well. There's just everything, like the walls were compressing on me, right?

• 1:26Speaker 01

  I told you to throw in the towel, remember?

• 1:27Speaker 00

  And Neil called me, he's like, hey, I have an idea.

• 1:31Speaker 00

  I was like, what? You should just bankrupt it. I was like, yeah, that's pretty, that's pretty reasonable, right? But like, in that moment, I'm like, you know what? If I keep going, right? And we make it work, it's going to be a great story at the end of the day and I'm going to learn a lot too. Or I could just throw in the towel, right? Now, it's still debatable right now, if that millions of dollars going back into things to, to, to save it was worth it. But I will say that in terms of how I got through it, it's just every day, it's, you look at this as an elephant, right? Just a little piece of it, every day, right? A little piece of it, just one step forward every day, sometimes it might be 10 steps back, but just one step forward every day. And things will get really tough. And I was just telling this entrepreneur today, I'm like, look, man, I get that you're overwhelmed.

• 2:15Speaker 00

  And I get that you need to think about it on, on, on all these things. But the reason why people succeed is because they keep going, right? It's, it's really, you don't have to be that smart, you just have to kind of keep going, but.

• 2:25Speaker 01

  But in your situation, and you can cut this if you don't want this in here, you got royally screwed by someone.

• 2:32Speaker 00

  By many people.

• 2:33Speaker 01

  But yes, and they wanted money for something that they didn't deserve money for. And it was a lot of false promises.

• 2:44Speaker 01

  Eric's a nice guy, he, he can be stern. I would say I'm a little bit more cutthroat than you.

• 2:50Speaker 00

  For sure.

• 2:51Speaker 01

  I would have just been like, I'm suing you, I don't care, you're not going to get anything. Eric's much more nicer, I was like, you should bankrupt him and give him zero. And I'm like, you know, and there's other ways around it where he could have saved it or done some different structured things. But I'm like, the other people are just trying to take advantage of him, they lied to him and they screwed him over and they didn't tell him. They didn't disclose everything that they legally were supposed to disclose.

• 3:13Speaker 00

  Yep. No, it was, I would say one deal screwed me, the other one didn't. The other guy was like a good guy, I, I structured that wrong, I should have kept the founder there, that would have worked out. But then, then there's like the hire we made that had screwed, you know, like a mutual friend of ours in a company.

• 3:27Speaker 01

  Oh yeah, you remember that.

• 3:28Speaker 00

  So, but that was a tough time in business where there's tough things going on personally, there's pressure coming in from all sides. But you either, you can throw in the towel or you keep going. And it's the people that keep, like you, you think about James Dyson, the Dyson guy, right? 14 years of failures, thousands of, I think it's 1400, something like that, vacuums that failed. And he had three kids, he, his wife still stuck with him and look at him today, right? I think it was the lion's share of the business.

• 3:51Speaker 01

  Although the last few years, I don't think Dyson's been doing as well, but they're so big, they still do well relatively.

• 3:56Speaker 00

  It's okay, he has an exit every year.

• 3:58Speaker 01

  Yeah, yeah, no, they make a crap ton of money. But Dyson's had had a lot of competitors and companies that are just taking a good chunk of the market share, like Shark is one. Mele has vacuums that are really popular and really good now, but there's tons of players who are copying Dyson.

• 4:14Speaker 00

  I like how you know the best vacuums.

• 4:16Speaker 01

  Uh huh, dude, we have so many of them in my house.

• 4:18Speaker 00

  Yep. You even have the one I told you to buy and you still haven't taken it out of the box yet.

• 4:22Speaker 01

  I know.

• 4:22Speaker 00

  See, that's the one you can give to your kids and say, hey, you know, you can say, hey, Matic, follow me. And it just follows you around the house and you can clean this.

• 4:29Speaker 01

  But I have a full-time cleaner, eight hours a day, seven days a week.

• 4:31Speaker 00

  But it gives the kids something to do.

• 4:34Speaker 01

  No, I want the kids to clean up their own stuff and do their own chores and make their own bed.

• 4:39Speaker 00

  Pick it up with their own hand?

• 4:40Speaker 01

  No, I make them do it and my wife makes them do it. And then, at the end of the day, after they make their bed, the housekeeper comes in and remakes their bed because the kids don't do well.

• 4:49Speaker 00

  Yeah.

• 4:50Speaker 01

  But it doesn't matter, they need to learn to go and do stuff. I'm not, I'm not going to raise lazy kids. They need to have some grit and grind and they need to be responsible. And they need to understand that mom and dad worked hard to deserve this life. They did not work hard to deserve this life, they got born into it, I do appreciate them. I'm, I brought them in, so it is my responsibility. But that doesn't mean that they should just be spoiled and not have to do anything.

• 5:15Speaker 00

  So let's talk, so I just gave an example, what to do when things get really tough in business? Why don't you go for one?

• 5:23Speaker 01

  Mine's actually similar, every time I've had things that get really tough, I push through.

• 5:31Speaker 01

  I usually figure out how to, typically when things get tough, it's usually tied to money. Either you're not closing enough revenue, or the profit isn't there, or something bad is happening. And that, you could say people solve it or better product will solve it. But I look at the root as in, if you had more money, it buys you time and you can hire the people or buy the companies that are competitors or build better products, money comes down to a lot of it. What I usually do during hard times, I haven't done this in a long time, is I liquidate everything that I owe. Like a home, literally my homes, if you look at how many times I've moved, think about how many times I've moved.

• 6:14Speaker 01

  My average hold for a house is 1.5 years, 1.5 years. Anytime things get tougher in business, or I see an opportunity, it's one or the other, I will liquidate whatever I need to so that way I can double down on the business. And that has worked out well for me, but I only do it when I really have conviction. But I will say this, the other day, my co-founder asked me, he's just like, you got a mortgage on your house, right? And I was like, yeah, he's like, why'd you take out the mortgage? And I was like, dude, I get a really cheap rate, call it 4.5%, I believe it's interest only, which is dirt cheap in this economy.

• 7:00Speaker 01

  And I was like, dude, there were some stocks that were, I believe at 60, 70% discounts that I just put the money into, and he's like, why'd you do that? I'm like, I believe I'll make more than the overall mortgage, like the dollars that I owe, like the debt I owe on the house. And in 12 months, I bet you I'll be able to pay off the mortgage and keep the same amount of money that I pulled off. And I only did it for that reason, because I thought it was very low risk. But generally speaking, he's like, so then why would you want to pay off your home after? And I'm like, well, whether I do that, the stock sells or not, I would just pay it off in the next 12 months. I don't want a mortgage, and he's like, why don't you want a mortgage?

• 7:44Speaker 01

  I'm like, I have a family, I have a wife, if I pass away, I don't want less, I, I want less worries for my family. So then that way, they don't stress out. So then he asked me, if we found this amazing business opportunity and it requires you to liquidate everything, would you do it? And I said, one, at this point in the business, I don't think that's realistic and we would have to, but two,

• 8:09Speaker 01

  I'm open to it, I would have a family discussion, but I don't want to. And he's like, why don't you want to? And Eric mentioned this to me, or was, it was someone, no, I think maybe Eric did, but also my head of, Amia, Mark Fagan, mentioned this to me. He's like, have a nice home with a big backyard and a big, a backyard's hard to find in Los Angeles. So that way your kids can run around and be happy. And they're so happy and the moments I have with my son, when I'm home and I'm not traveling, I play soccer with him almost every single day in the backyard. We do foolish stuff like trying to kick the ball on the roof or get it stuck in a tree. I know we're not supposed to do that and mess up the roof tiles, but I don't care. Those memories to me are priceless and worth more than how much more I can make in the business.

• 8:54Speaker 00

  Yeah, well, also.

• 8:58Speaker 00

  They're old enough to know what's going on now, right? And like before, when Neil built the home and he moved out like a month after he finished building it, like they didn't know what was going on yet. Now it's like they're building, they're building something here. They're like making friends and all that. You have a community here now, so it's harder to pull it out.

• 9:13Speaker 01

  You nailed it. My son, when we moved into the house, you know what he said? Mommy, I love my room. I love this house, but don't let daddy sell this one. I want this one.

• 9:24Speaker 00

  Yep. So when you say family meeting, it's never a family meeting. It's Neil's decision, so.

• 9:29Speaker 01

  Yes, my, my wife would be down for whatever I want. She's always down for anything and she doesn't, she doesn't care too much about homes and stuff like that. If she had to pick the number one thing she cares about, other than health and family, it would actually be kids education. If I said, hey, we had to pull our kids out of the school, that is a very hard conversation that I won't win.

• 9:48Speaker 00

  It's nice to have stability, right? Speaking of stability, so we've been interviewing like these people to, to join the company and I always anti sell them at the end. And this guy was like, you know, the, the company I'm at right now, like this guy's an SEO leader, right? He's like, the, the company I'm at right now, they're just not AI for it. I'm like, how many, how many people are here coming to AI for it, right? Like he's like 5%. I'm like, he's like, yeah, you know, I really want to grow. And he's like, you know, what's also really important to, to me in this part, point in my career, stability. I'm like, wait, but you want to grow? And he kept using the word stability, right? And so at the end of the, the, the interview, I was like, look, man, I'm going to anti sell you right now. And this for anybody that wants to join and, and work with us, right? First of all, if you're going to work with us, it's not a nine to five. It's a startup environment. Okay, so don't expect a clock in, clock out. So the second thing is, don't expect stability, right?

• 10:32Speaker 00

  It's, it's like when you're, when you're growing very quickly. I would say that, you know, it's, it's stable from a, you know, you're going to learn a lot. It's a good job and, um, you know, we have, we have great clients and all that. But inherently, if you're trying to grow, like if you're lifting weights, for example, you're, you're tearing muscles in your body all the time, right? Like that part is unstable. And I also said, what, what else did I say? I said, oh, expect direct feedback and expect it in public sometimes too, right? So by the way, Neil does a good job with anti selling people. Sometimes, sometimes it works, sometimes it doesn't. But, um, you're better off from a toughness standpoint, doing that. Because if you end up hiring these people and they're not a fit, it's way more painful. So stability is not something that's necessarily in my vocabulary right now. Because of the nature of where things are.

• 11:17Speaker 01

  You, you have quite a bit of stability. You and I are actually very similar. If you think about it, either we're stable on our personal life or stable on our business life.

• 11:27Speaker 00

  Yeah.

• 11:27Speaker 01

  We're very rarely ever stable on both. You are stable right now on your personal life.

• 11:32Speaker 00

  Yep.

• 11:33Speaker 01

  I'm very stable right now on my personal life. Both our businesses are chaotic. I wouldn't say they're chaotic in the way they're doing bad.

• 11:40Speaker 00

  Yeah.

• 11:40Speaker 01

  We're just changing a lot of stuff.

• 11:42Speaker 00

  Yeah.

• 11:43Speaker 01

  Pushing, we're putting a lot of pressure, we're trying to grow faster. There's a lot of chaos in business. I would say personal life is very stable.

• 11:49Speaker 00

  I prefer the chaos in business, so.

• 11:52Speaker 01

  Yes, I, I don't know how to create.

• 11:53Speaker 00

  The good chaos, the good chaos, not the bad chaos, not, not the whole like five years ago.

• 11:56Speaker 01

  No, no, no. I don't consider that chaos. I look at that as a disaster.

• 12:01Speaker 00

  Yeah.

• 12:01Speaker 01

  I look at chaos as in like, you're changing a lot of stuff, so it creates pressure. People get uncomfortable, but from that usually causes more growth. So I, I like that.

• 12:12Speaker 00

  Dude, yeah, no pressure, no diamond.

• 12:14Speaker 01

  Yes, but I, I found.

• 12:17Speaker 00

  Frictionless Growth Marketing hosted by Sonya Thompson is brought to you by the HubSpot Podcast Network, the audio destination for business professionals. Frictionless Growth Marketing hosted by Sonya Thompson shows how modern brands grow by removing the friction in their marketing and customer experience that pushes customers away every single day, often without leaders even realizing it. Each episode delivers practical insights, real brand examples, and conversations with marketing leaders, showing brands how to win with the new rules of growth, identity-driven marketing, cultural relevance, and frictionless customer experiences. Listen to Frictionless Growth Marketing wherever you get your podcasts. That, real quick, if you want to acquire customers faster and more efficiently this year with the latest strategies and tactics, then check out singlegrain.com.

• 13:01Speaker 00

  That is my ad agency, again, www dot singlegrain dot com. Check it out and if it seems like a fit, we'll get in touch and help you with a free marketing plan.

• 13:09Speaker 01

  When things, I, I've never had both very stable. I have to have one that's somewhat chaotic because I get bored.

• 13:17Speaker 00

  As long as I've known you, you've mostly have had stable, you know, personal stuff for the majority. Yeah.

• 13:23Speaker 01

  It's usually business.

• 13:25Speaker 00

  Yeah, you've never, on the personal side, I've never seen you that unstable.

• 13:28Speaker 01

  Yeah, it's usually business.

• 13:30Speaker 00

  Business side, but the business instability is, is caused by you wanting to grow. So it's, it's been, it's been good.

• 13:36Speaker 01

  The business chaos is usually stuff like me yesterday. I get my CEO on the phone, I get my CFO on the phone, I get our head of legal on the phone because we have in-house counsel. And I'm like, hey, I got a deal. A buddy wants to sell his company. These are the numbers he told me. He, he needs to close in 30 days. Let's make it happen. You have the data room access.

• 13:59Speaker 00

  See you guys later.

• 14:01Speaker 01

  Yeah. And less than three hours. And I'm right, I was like, see you guys later, but let me know if you want to call. They're like, how about we have a talk tomorrow morning? I'm like, analyze the data room today. But I was like, I'm speaking in the morning, so I won't be able to do the call.

• 14:14Speaker 01

  I did, we did analyze the data the day it came into the data room within an hour or two. And then the, the chaos went away because we quickly realized the numbers don't work out. And it wasn't that it's a bad company. The numbers that I was told over the phone versus what the numbers were really were two different things. So then.

• 14:35Speaker 00

  Isn't it funny? What percent of the time are the numbers that they tell you versus the real numbers accurate?

• 14:39Speaker 01

  Dude.

• 14:40Speaker 00

  Zero percent.

• 14:41Speaker 01

  No, not zero percent. Are you talking about bank, banker processes or non banker processes?

• 14:47Speaker 00

  Let's go both.

• 14:49Speaker 01

  Non banker processes, almost a hundred percent of the time, their numbers are off.

• 14:53Speaker 00

  That's what I'm saying.

• 14:54Speaker 01

  Banker processes, the numbers aren't really off. It's just how they move around numbers. But in non bank processes, someone could be like, I'm doing three million a year in profit or five million a year. And you look at the numbers, you're like, this is not five million a year in profit. This is three million a year in profit. You're off by $2 million. You know, when you do three million, I don't know how you think three million is five million. There's a big difference. You should know the cash flow. And I saw this firsthand when I was talking to someone and we were trying to do a deal. They're like, yeah, we grew really fast. In a year and a half, we're now at, uh, $3 million a month. So they're growing extremely fast, more than tripling. And we were trying to analyze, see if we can do a deal.

• 15:37Speaker 01

  And then within a few weeks, they're like, oh, we were off buying numbers by eight figures. And I'm like, how the heck are you off buying numbers by eight figures? Eight figures is more than 10 million dollars. You should know in your bank account if you can see the money or not. Non banker deals almost always are off. Banker deals, they're pretty accurate on their revenue. They're pretty, they're not as accurate on their profit because it's what they classify as profit. I had another deal that we were about to do. We walked away from two deals literally in two days that we thought we were going to do. The one yesterday, it was a long shot. We didn't really think we were going to do it. We're like, if the numbers are true, I told the person on the phone, I'm like, we'll do the deal. The numbers weren't, so I don't feel bad. But the other one, we were talking for a month.

• 16:20Speaker 01

  Dude, they added back a lot of salaries and they consider that profit. And I'm like, but when I buy this company, I have to pay all those people, right? Yeah, so that is not profit.

• 16:32Speaker 01

  And I'm like, it doesn't matter how you classify it, that's not profit. I got to pay these people. And I see it all the time. But when it's banker led, like we're, we were dealing with a business, uh, six months ago. And their profit didn't decrease much, but it was because a lot of people took pay cuts. And I was like, well, if I bought that business, I'm going to have to pay people what they're really worth. So then there goes a lot of the profit. I'll buy you on what the real profit is, not on you guys all getting pay cuts and expecting a pay raise the next day.

• 17:01Speaker 00

  So this is why, even though Neil doesn't declare himself a CEO, officially doesn't have that title, I also declare him a CEO because the CEO causes the thing called the lightning bolt CEO, where you find something amazing and you strike the lightning bolt and it's like, here's the problem, right? Goodbye, guys, and you're back again, right? And so that's a very CEO thing to do. So two more things, I, I, there's a case study I want to talk about with the, this, this massage, um, place. But one more thing. So when you look at Cursor, Whisperflow, uh, Replet, HeyGen, Victor, how many active ads do you think they have at any given time? So these are kind of the, these are AI startups that are pretty hot right now. Gamma's in there, Framers in there, Superhumans in there.

• 17:39Speaker 01

  How much they spend on ads or how many ads they have in their platform?

• 17:42Speaker 00

  Ads they have at a time.

• 17:43Speaker 01

  Like when people are using their app, how many ads do they see?

• 17:45Speaker 00

  No, how many active ads in like Meta Ad Library or something like that?

• 17:49Speaker 01

  Oh, I get what you mean. I don't know, maybe three, four thousand?

• 17:54Speaker 00

  An average, any given time?

• 17:57Speaker 01

  I'm assuming they're using AI and just testing a lot of ads.

• 18:00Speaker 00

  So Cursor is eleven hundred, Whisper Flow is eight hundred twenty, Emergent four ten, HeyGen's four hundred, Victor six twenty. And to Neil's point around testing, Cursor sixty four hundred tested, okay? Whisper Flow is thirty three hundred tested, Emergent seven thousand tested, HeyGen seventeen hundred. And so, you know, this is from Ira Badnar, but it's often more ads than you think you actually need. And people think it's like, it's a whatever thing right now, and you can just kind of get by. So just wanted to call that out, that paid ads still exists.

• 18:32Speaker 01

  Yes, yeah. So let's wrap up with a case study, and this will be a fun case study. Eric and I have a friend who worked at a five-star hotel, in the spa, he was giving massages. The hotel wasn't doing well, and they shut down the spa, so he had to figure out what to do. So Eric and I were like, dude, you live in Los Angeles, why don't you just do, I think it's called outcall, where you go to people's houses, right? Is it outcall or incall?

• 19:00Speaker 00

  That's an escorting term, I think.

• 19:03Speaker 01

  I don't know, like, what is it called when people go to?

• 19:06Speaker 00

  I think it's just.

• 19:07Speaker 01

  It's called outcall.

• 19:09Speaker 00

  Okay, so outcall massage, okay?

• 19:10Speaker 01

  Okay, so, you know, I was just like, alright, how do you make more money? Now, this person was doing outcall massages and making five thousand dollars a month, which may seem like a good income, but keep in mind, you gotta drive to people's houses.

• 19:28Speaker 00

  Yep.

• 19:28Speaker 01

  You got to pay for.

• 19:32Speaker 00

  Parking, maybe?

• 19:33Speaker 01

  Parking.

• 19:34Speaker 00

  Yeah.

• 19:34Speaker 01

  Gas, you got to, it takes time out of your day.

• 19:37Speaker 00

  It's like three hours for a one-hour session.

• 19:39Speaker 01

  And then you gotta pay for materials, right? Towels, hot stones, oh, that actually sounds nice, you know, when you take the stones and they push it on your back?

• 19:48Speaker 00

  They don't push it, they rub it on your back.

• 19:51Speaker 01

  I thought they could push it.

• 19:52Speaker 00

  That's something else.

• 19:53Speaker 01

  Okay, so, or cupping, you know, like when they put the cups on there? Although that may be not chiropractic, what is that called, like the needleings?

• 20:01Speaker 00

  The lavender scents.

• 20:02Speaker 01

  Lavender scents, or the aroma, you know, those machines that blow smoke and stuff like that?

• 20:06Speaker 00

  Yeah, yeah, yeah, yeah.

• 20:07Speaker 01

  The table costs money, wear and tear on the table over time, you have to buy a new one?

• 20:10Speaker 00

  Yeah.

• 20:11Speaker 01

  I could be wrong, but.

• 20:12Speaker 00

  Yeah, so, so here's what happened, right? So for this, this, this massage, this masseuse, so basically, he was charging around, let's say, you know, three hundred dollars per massage, right?

• 20:24Speaker 01

  It was less than that, it was, call it two hundred dollars.

• 20:27Speaker 00

  Okay, two hundred dollars. Now, here's the thing, it's a supply and demand equation, because this person was getting around thirty leads, thirty inquiries a day, right?

• 20:35Speaker 01

  So. But thirty inquiries a day, most of his clientele were people that worked in offices.

• 20:42Speaker 00

  Yep.

• 20:42Speaker 01

  Like people who could pay money.

• 20:44Speaker 00

  These people make good money, too.

• 20:45Speaker 01

  They make good money. The issue, though, is, most of them wanted him to massage after working hours from like five to seven o'clock or something like that.

• 20:54Speaker 00

  So realistically, you probably do two, yeah, exactly.

• 20:56Speaker 01

  Two slots, and that's if you're not driving, people want to be done before dinner, but they didn't want to do it during the day, because a lot of these people did not work from home. And out of the thirty inquiries, he mentioned how six were real, that would have really paid money.

• 21:12Speaker 00

  Yep.

• 21:13Speaker 01

  Because a lot of tire careers would be like, yeah, I'm interested, oh, I'll book it when I have time, or, oh, how much is it gonna be? Oh, I don't want to spend that, can I get a coupon or a discount? But he had six really solid ones. The first thing we told him to do, because he was like, hey, how do I increase my pipe? How do I do more marketing to get people who want massage services during the day? Kind of like a hotel and spa, I'm like, that's a different clientele than what you're getting for marketing yourself online. And the first thing Eric and I told him was, one, you have some no-shows. Everyone should Venmo you the money in advance, because then if they don't show up, at least you got paid.

• 21:47Speaker 00

  Yep. By the way, OpenTable does that all the time, they take a reserve.

• 21:50Speaker 01

  Yeah, for a lot of restaurants. Two, we also told him you should increase your pricing. So call, instead of two hundred, we said go to three hundred dollars right away, because you have six people that'll take the slot, but you only have two. He didn't want to charge four hundred, Eric and I said we should just double up the pricing.

• 22:07Speaker 00

  I said go five hundred.

• 22:08Speaker 01

  Yeah, and, and he's just like, that's too much money for people in Los Angeles. So I'm like, dude, if you're massaging people in places like Beverly Hills, Century City, these are, there's big office complexes here in Century City with a lot of executives making tons of money, tons of private equity stuff.

• 22:23Speaker 00

  Yep.

• 22:23Speaker 01

  So we're just like, you should charge more. He did increase pricing fifty percent, and it's doing well, and it hasn't affected the take rate, and all the slots are still getting full.

• 22:31Speaker 00

  In fact, of a sample size of ten people, four declined, but six took it.

• 22:36Speaker 01

  Yeah.

• 22:36Speaker 00

  The higher price.

• 22:37Speaker 01

  And then the other thing we said is, start making everyone come to your house, set up a room.

• 22:42Speaker 00

  Incall.

• 22:43Speaker 01

  Incall, instead of having to drive, because you lose a lot of time and money on the transportation, and if people want you to go to their house, charge even more money because of your costs.

• 22:53Speaker 00

  Quadruple.

• 22:54Speaker 01

  Yeah, I don't know, quadruple.

• 22:56Speaker 00

  Or quadruple the original rate, you know? Or maybe triple, maybe triple.

• 23:01Speaker 01

  Yeah.

• 23:01Speaker 00

  But my, my point is like.

• 23:02Speaker 01

  Or five hundred, like you were saying.

• 23:03Speaker 00

  Yeah, but like, it, it, to have to go through the, it's very tiring to have to do like two outcalls in a day, right? That makes it not worth it, but if you can bring them in, you know, whatever, and then the deposits, you end up making net more, so instead of five grand, which is amazing, you end up making what?

• 23:19Speaker 01

  Uh, well, the best advice we gave is, he was working six to seven days a week. He was having, just not brain dead, but like, he felt just worn out, tired. Because you have to remember, if you're massaging people, using your muscles, I don't know what muscles, but in your hands, your fingers, I bet you they hurt after a while? Your wrist muscles?

• 23:38Speaker 00

  I don't, dude, I don't know how to massage, I'm really bad, like this, you know, like.

• 23:42Speaker 01

  I have a ther- theragun, you know what a theragun is?

• 23:45Speaker 00

  Yes, I know what a theragun, I have one, I don't use it though.

• 23:47Speaker 01

  This is amazing, I don't use mine either, not much I have.

• 23:50Speaker 00

  Yeah.

• 23:51Speaker 01

  Uh, so, what we said is, increase your pricing, work only five days a week. And then that way you make more profit, and you also have relaxation for yourself, for your muscles, your, your brain, and you're just more energized.

• 24:08Speaker 00

  It's all more peace of mind, the incall piece, like, that's gonna save you time and energy, the deposits, you're gonna make net more money, so you don't have to work as much. And so it's all about making these little tweaks as you're going through it, and then this person now has a, has a menu that they're, that they're optimizing, right?

• 24:20Speaker 01

  Yes.

• 24:20Speaker 00

  So, yeah.

• 24:21Speaker 01

  Yeah, I, I gave them really cuckoo ideas, like, hey, why you give a massage? Offer like a face mask. Like, you know, like the estheticians, what is it called?

• 24:33Speaker 00

  Uh, whatever, like, beauty esthetician?

• 24:35Speaker 01

  I don't know, like, you know, like, people put, like, you see on the.

• 24:38Speaker 00

  When they go to sleep.

• 24:39Speaker 01

  You know, you see on those TV shows or movies, people have like those cucumbers and a green mask over their face? And I was like, dude, offer upsells.

• 24:46Speaker 00

  Upsells, yeah, because the hot stones had a real, like, if you get it at Encore or whatever, you're adding like another thirty dollars or sixty dollars.

• 24:52Speaker 01

  Are you talking about Win Encore?

• 24:53Speaker 00

  Yeah, Win Encore, yeah.

• 24:54Speaker 01

  And that's Encore, they're gonna charge you double.

• 24:55Speaker 00

  I know, but when you get a nice massage, it's at least three to four hundred dollars, right? And you add the this, and then the lavender thirty dollars here, the hot stone here, thirty dollars here. Oh, you wanna, you know, you want an extension to like ninety minutes or whatever, and then two-hour massage? And before you know it, you spend like, you know, an arm and a leg.

• 25:11Speaker 01

  Yes. The other thing Eric and I also recommended was hire an apprentice, because some of his clients are couples, and instead of doing one back to another, you could do couples massages. And you can have apprentices, charge more, two tables, and then you can knock out more in the day, versus just doing one and then doing another.

• 25:31Speaker 00

  And by the way, what we're talking about here, you, why, why are they talking about massages? Well, because this applies to any service business.

• 25:36Speaker 01

  It's also funnel, we talked about so many upsells and downsells, ways to charge more, reduce, in this case, there's no refunds, but there is people who book you, and then they cancel on you last minute, and you don't get the money, which is just as bad as a refund.

• 25:51Speaker 00

  Yep.

• 25:51Speaker 01

  Because you can't do something else.

• 25:52Speaker 00

  And you can play with other stuff, too, like, your, your favorite customers, they give you referrals or whatever. You can, you can do like, you know, give them some, give them free referral or something like that, free massage from, from, from referral.

• 26:03Speaker 01

  That's true, he's been getting referrals.

• 26:04Speaker 00

  Yep.

• 26:05Speaker 01

  And we, we told him about setting up referral programs, where people give a lot of referrals, let them have the older rate.

• 26:10Speaker 00

  Yep.

• 26:10Speaker 01

  So it just.

• 26:11Speaker 00

  Grandfather's. So there's all these things that, it's, these things carry over into whatever business that you're in. So we hope you enjoyed that one. If you want more case studies like this, let us know, and we'll see you tomorrow.