Transcript of Interview with Matt Frary
Dan: Welcome to another episode of Shoulders of Titans. This is Dan Lok and today I have the privilege of bringing you an innovative visionary, a master marketer, an exceptional internet entrepreneur, CEO of Inc. 5,000 fastest growing companies in America, Chief of Chaos. Matt, welcome to the show.
Matt: Thank you so much Dan. I love that intro and I think every time I walk in a room, I should take that recording and play it as my own.
Dan: Thank you Matt. Now, we’re going to talk about in how to choose a niche, how to launch a company, how to grow a company, and we’ll also a little bit about school smart versus street smart. I’m very excited to have you on the show. Maybe, just tell us a little bit about your background and how you got into what you do today.
Matt: Sure Dan. I started at ebags.com. I had never been on a laptop before. This is about 1998 and I was basically afforded the opportunity a lot by chance honestly. I mean I went after the opportunity but they basically say, hey, call a bunch of websites, get our link placed on those and those websites being travel websites, hopefully, they’ll sell some luggage and so that’s really how I got started online to be very honest with you, making phone calls to websites. So, as that career progressed, I’ve got to work at Microsoft, building their auto channel for a while, driving auto leads.
I worked at one of the top agencies here in Denver Colorado where I’m located and got to work on anything that was digital. Every time a brand would say the word digital or say .com, I would raise my hand and say, I want to work on that and that just provided a lot of groundwork and experience and then it’s kind of funny, I ran into pre can spam and pre 2004, I ran into a list broker that say, hey, I’ve got lists, do you want to do direct marketing and I said, well, how much are you selling the lists for? He said, 50 cents per a thousand and I say, well I think I could sell those for five dollars per a thousand. I would basically work out in my closet at night with my main job and I created a company called Email Wholesale for a little while and I would sell direct marketing lists to people and try to get them more customers by having them send to those lists.
There was a little bit of learning curve there of what direct marketing look like, the proper way to collect names etcetera. Then, something was missing. I just didn’t have the book smarts. I didn’t understand how the scale a company. I didn’t understand basic business and so I dropped up for a while. I went to Thunderbird, the International school of business and I got my MBA in the Finance of Brands so basically Brand Finance and how to get a return on your investment.
Trying to shorten the story a little bit, I was broke I had just come off an internship with Mercedes Benz launching the smart car in the United States and I was looking for a bartending job and money is a motivator and sometimes we become very inventive out of necessity and so I contacted a guy that I knew on the internet, and he said, hey, I just made a bunch of money with Click Bank which is an affiliate network and he said, give me a call and let’s see if we can do something together. So, I gave him a call and I ended up building an affiliate program for a company called Survey Scout. We built that into a top 25 affiliate network called ROI Rocket and we built that into a company that over the time I was helping him manage it was somewhere in the neighborhood a 40 million dollars.
Dan: So Matt, it sounds to me that from, is this always like, are you always a planning kind of guy or you kind of go with the flow?
Matt: Well, I have to tell you, if you ask my wife, I’m the go with the flow and she’s the planner. So, she will always say, you just take opportunity when it comes up but you don’t plan the opportunity. I always say that luck is really the intersection of preparedness and opportunity. Being prepared enough to know when the take the opportunity so I’d like to think that I am both and I have been planning for a long, long time to become successful.
Since high school, I’ve been in business clubs and learning selling. I used to be in a program called Distributive Education Clubs of America and it had always been on my mind that I wanted to be successful whatever that means and to be very honest with you, that definition has changed over time for me, what successful actually means, I’m sure you can relate. As you grow in your career, your prize keeps changing, the destination keeps changing and it should and so what I think you have to plan ahead for is whether all the things you might meet along the way and how you’re going to deal with those when they arise and be ready for anything that you didn’t think about to arise and be ready to take that opportunity.
Dan: Matt, let’s say for someone listening, how would you look at the entrepreneurs you know when you get opportunity all the time, someone pitching us an idea ones again involved with something? How do you analyze? How do you tell which opportunity you should be pursuing? Which opportunities like, nah that doesn’t look like quite what I do.
Matt: We get pitched on a regular basis opportunities. I’m now running smarterchaos.com. It’s a top online agency managing somewhat Fortune 500 brands so a lot of people see that success and they’ll pitch us all the time. What we do is we try to separate a good idea from a good business. You can smell bad ideas pretty quickly and usually those are the things that you just don’t get right away. But a lot of times, what entrepreneurs gravitate towards is good ideas but they don’t have a very good business model behind them and so we have to separate that a lot of times from our emotional response of well that’s a great idea and I want to expound on that idea and then you get so far down the path, you forget about the tying it to how you’re going to get money from it, how you’re going to build a business, how was that going to scale, how could you support your family with that idea and how could you support those around you that are working on the idea.
Dan: As I always say, all of my problems in life start out with an idea.
Matt: Right and a lot of times when we chase that shiny object, we call it the squirrel syndrome, when we chase the squirrel a lot of times, we forget what we were chasing and we get way far down that path. We should have shot that idea a long time ago. In our business, in our world, we can’t shoot an idea or fire a client fast enough if it’s not working out and making us money.
Dan: It makes sense. Should looking beyond than just an idea, you’re looking for the business model what’s behind the idea, how do you scale, so if the client that you’re working with any opportunity if the other party they can answer these questions then you’re living more comfortable.
Matt: Right. So we have to understand from an idea of perspective, have you thought about how this would make money? Do you see yourself in five years still working on this or it’s just a hobby for example?
Dan: That’s a good question.
Matt: Yeah and the other thing is, does it interest us? I mean a lot of times, I have friends and family that over Christmas and Thanksgiving pitching idea to me.
Dan: I can imagine.
Matt: And my first response is always back to on this, ‘could you really see yourself doing that?’ If someone says to me, well I would like to start a food truck, I always look at them and say, well are you willing to work in that food truck for five years, over the grill, setting up, going to events, missing every major holiday, is that something that you’re really willing to do or you’re just thinking it’s a good idea? I mean there’s a lot of examples of that, you always just have to take that lens of is it just a good idea or is it a business, something I’m passionate about.
Dan: Once you find something that, you know what, that sounds like a pretty good opportunity because I want to understand your process, then what’s the next step for you?
Planning and Modelling
Matt: Honestly it’s all down to planning and modelling. You don’t have to build and 80-page business plan which believe me, I do. I do that for a lot of opportunities. But the first thing you need to do is sit down and put down, income minus expenses equals profit and you need to look at that profit equation and really dive into: where does the income come from? Is it cyclical? Is that income something that is easy to obtain? Do I understand the pricing structure to get the income? Is the marketing difficult to get the income? So you really have to dive into that income part of the equation and decide, is that something that the market’s big enough, is it attainable? Do I understand the market to enter it? How hard is it going to be for me to get the income?
Then, you have to look at and say to service that income to be able to build this business, what am I realistically looking at in overhead and expenses? When I say realistic, am I hiring other people? Am I doing the work? Am I outsourcing it? What does the materials cost? What’s the cost of good sold? Incrementally per product, how much is that going to cost me? What kind of marketing dollars am I looking at to capture the market that I am talking about. So there’s a lot that goes into expenses as well and then out putting out of the bottom is profit. How long is profit you’re going to take to get to profitability? Am I willing to wait that long? Do I have enough cash to last that long? Etcetera, etcetera.
My son just did, he’s seven years old, and he just did a course here in Denver called Ameritown. Ameritown teaches you the simple profit equation of income minus expenses equals profit and when I went over that with him, I went back to every single one of my businesses this last couple of weeks and I said, am I following that simple equation or is my income line not high enough per client? Is my expense too bloated and am I working for nothing in this business? We have to apply that universal profit equation in everything we do.
Dan: Sometimes when I work with entrepreneurs sometimes they have this false belief that it’s all about growth, that if I have enough sales, I have enough gross, that’s going to be some net somewhere. That’s not always the case, somewhere but it’s not always the case.
Matt: It’s funny like you become that kind of Greek mythology of the God pushing the rock up the hill and you just keep pushing it and you push it and the hill never ends, you’re just pushing the rock up the hill, right? If you don’t know where the end of that hill is, that’s a pretty miserable existence. That’s what we called punishment. Knowing where profit occurs and knowing what you have to do, the rest is execution, execution is key to everything. If you’re not the person to execute, get the people around you that can execute. Dreamers are good for something, visionaries are great for a lot of thing but the people around you that have to execute this idea, you need to lead them in the profitability and if you don’t know where that target is man, it’s always going to be moving.
Dan: That’s awesome. I think it’s for entrepreneurs, it’s interesting because I notice a lot of entrepreneurs, I think it’s because of your training, your MBA training. I can see it’s much more detailed to read financials, believe it on Matt, I’m sure you met a lot of entrepreneurs they never read their own financials.
Matt: Right. I’ll be very honest with you and be very transparent. When we first started our internet company ROI Rocket, I think it was a year and a half before we put financials together and we had millions of dollars coming through that company and I said, shouldn’t we hire a CFO and really look at what we’re doing here or should we just keep checking the cheques in and hoping that they are more than the expenses. Eventually we tightened that up of course and luckily, we existed for maybe a year and a half before we really got down to the nitty gritty of that but there’s very few patient investors, very few patient family members including your wife and there’s very few patient friends around you that are willing to invest in something what you don’t know where that financial end is or the return of investments.
Dan: Yes and I always say your balance sheet, your income statement, in fact I believe even profit is a theory because you can’t go to the bank and just say, I want to deposit my profit. So, from profit to cash, I believe actually the most important thing is the cash flow statement for myself because no company goes out of business because of, company goes out of business most of the time not from lack of revenue, sometimes not even lack of profit, because they run out of cash.
Matt: No, it’s cash flow. It’s cash management. It’s working capital. So you can’t pay your bills on projections and you can’t pay your bills on a crude income or expenses. You can only pay your bills on the cash you have in your business and the only way to get cash is from two places. You get cash either by going to a bank and asking for it or you get cash from friends and family to invest. I’m sorry there’s a third way. You make money by having more income minus your expenses and that equals profit and you didn’t have to get the cash in the business called receivable. You’ve got to get that. But there was one good piece of advice that was given to me by one of my mentors, his name is John Nord Marquez here in Denver. He found the ebags.com which is a multi-hundred million dollar company now and I was lucky enough to start at EBags when I was in my early 20s and he was about 30.
But what John said to me very recently in the last couple of years, John said to me, “Matt, you don’t need to go out looking money for your ventures. What you need to do is get out there and sell enough that it covered your expenses and so you just need more sales.” He said, “infuse cash into your business by increasing your sales. Focus on your sales not your marketing but your sales. Figure out the way to sell more and increase per customer.” That’s a whole another way. A lot of people spend no time saying, how do I raise money, raising a series A, a series B, a series C, whatever until series Z who knows. I have never raised money in my life. I’ve never done it, have you?
Dan: That same thing, yeah, I always internal growth, sales, revenue.
Matt: Right, organic growth, internal growth. There are only a couple of Ubers, Googles, Twitters, Facebooks in this world. The rest of us have to grow by sales and execute.
Dan: Correct. Interesting, maybe I should ask you this because I think listeners want to know, so back then through the survey, the Click Bank days, you make tens of millions of dollars, what did you do? How did you build that company? Then also I want to talk about the why you transitioned out of that and what else the lessons you’ve learned but let’s go back then, what are some of the steps that you take? What are some strategies that you implement to grow that company?
Matt: Sure, I mean I think the first thing that we did is to build Survey Scout back in the day and that’s really taking me pretty far back is to build partnerships. The first thing that we focus on was looking at what we call affiliates, people that send you traffic online and you give them a pay-off for that traffic. We always said, let’s be as generous as possible with our affiliates. Let’s give them as much as the upfront revenue as we possibly can to reward them for the risk that they were taking.
Dan: At the time, what percentage were other people paying and what percentage were you guys paying out?
Matt: Survey Scout was one of those programs where you pay $34.95 upfront and then you got a list of companies that wanted your opinion, so legitimate companies like Light Speed Research, Ipsels, Nielsen, and then you got a list, and then you got onto those list and you took surveys and those surveys really did pay you money so they would pay you, you answer the survey. You make two dollars. You answer this survey, you have five dollars. So basically for $34.95 like a power list a place you can do surveys and then in the back of what we did was take other people’s programs that we verified could help you earn an income and we plug those in as special bonus offers.
What we did because we knew we could make money on the back end through some of these other offers by being a partner into some of these other folks who joined ventures, we actually paid 100% of what we made upfront to our partners. So we would take that $34.95 and most likely pay somewhere between $30 to $35 on that. That’s it, that’s it caused back relations. Our theory and it’s always proven very well is if we could take the revenues that we earned on the first time meeting that customer and the profit that we earned, If we could take that and pay our partners a 100% of that, we pay them for their risk, we’ve obtained the customer.
It’s up to us after that to work with the customer to earn additional revenue. It’s interesting that you asked that question because if I look back at what we applied in the business opportunity days and now, I fast forward to the Fortune 500 that I worked with now, we’ve launched programs for Twitter. We’ve launched programs for Meredith Magazines, Nationwide Insurance, CBS. We tried to apply with them the very same principle. Reward your partners handsomely upfront for taking the risk and it’s up to you to convert customer afterwards and get a return on that costumer through a valid authentic relationship that you get with that customer.
Dan: Let’s see if I understand you correctly. Basically you are acquiring customers at a break even to attract the highest quality, the most amount of joint with your partners and affiliates, you give them, basically, all the money upfront so that you casts a wider net and so it brings in a lot more leads, a lot more customers, you could upsell to if you have any upsell process funnel that works that shouldn’t be a concern.
Matt: That’s correct and if it’s a legitimate product, if it’s something that add, provides value, that you would purchase yourself if you were in your customer’s position, if there’s true value to that product then you will be able to have a conversation with your customers over time through standard marketing techniques and be able to upsell them, cross sell them, have a conversation with them with content and provide additional opportunities to them in the future. So following that model is very important but there’s also another key thing to this. I don’t believe you can be successful selling something that is not real. There’s so many smoke and mirrors online.
Dan: Oh, no way. Come on? Seriously, Matt?
Matt: I mean, somebody asked me the other day how many internet gurus are legitimate and I said, I probably shouldn’t have phrased it the way that I did but I said, basically, show me an internet guru and I’ve ran over them in the road because they’re very little value to them. Where there’s value is someone that is willing to partner with you, someone who is willing to joint venture with you and also somebody that’s selling you something of value. There’s one rule that we apply, and that rule then is called the ‘your mama’ rule. Your mama rule basically is that, if you wouldn’t sell it to your mother or you couldn’t talk to your mom about it at Thanksgiving or Christmas or you wouldn’t opt your mom into that list because she’s going to get spam or you wouldn’t take your mom’s credit card for that recurring billing that’s occurring because there’s no value being provided to her.
All those things you would warn your mother about online, those are the things you should not do online. Those are the things that you need to make Sure that you stay away from. The things that you should do or the things that you can’t talk to your mom about it could, that you would opt your mother into. You can hang your head high at the end of the day and feel proud around your family about what you do and you can go to your costumer and build good will with them and they would talk about you in superlatives, that’s the right business to be in.
Dan: I totally agree. I mean, the internet, just because the barrier entry is so low and people sometimes stay in the kind of the gray area, then you know, they’re a little bit slimy, a little bit scammy, they get away with that kind of stuff but it doesn’t last.
Matt: You know what happens when you layer gray over gray over gray?
Dan: It gets darker and darker.
Matt: It turns into black. You take a lead pencil that started out gray and you just start to add layer and it gets black and eventually, you can’t figure out what is in the picture anymore.
Dan: But nowadays, internet is so transparent anyway. I mean if you are not adding true value to your customers, people tell other people, it doesn’t lasts.
Matt: Absolutely, I mean referrals are the number one way to get business, it’s how we get our business. We do little marketing for Smarter Chaos and any of my other businesses. Most of the businesses that we do is through referral and word of mouth and other customers telling other customers and repeat customers. If you can’t build that through the type of service you provide and you’re always worried about cancellation rates or trying to mitigate customer service and how my customers are cancelling then maybe you’re in the wrong business.
Dan: Matt, also, what I’m learning from you, this is being generous to the affiliates. At that time through Click Bank, the Click Bank vendors, they provide tools, emails, and banners and what other things did you do that’s maybe different than other people?
Matt: Absolutely but I think it’s still there. I’m not sure if it is but if you went to surveyscout.com/affiliate, we built an internal log in that gave tips and tricks and newsletters, eBooks, banners, creative, we would design your banners for you. We did everything we could to get our partners successful. What I tell large corporations today because the mentality of those large corporations a lot of times is well, they are using my brand and we don’t want them using our brand but we want them to sell our products. They can use our banner but they can’t mention us in search. They can use our likeness but we have to police their content.
A lot of times we say wait, if you were selling Avon and you had a channel of 50,000 Avon resellers, you’re the company Avon, what are you going to do to grow Avon to 500,000 resellers to get more sales in the door? You’re going to provide those Avon reps with the best product with regular webinars, with regular check-ins. We’re going to give them all the tools. You’re going to give them all the one cheaters. You’re going to give them sales training. You’re going to do everything you can to help your distribution network sell more.
A lot of times, people think of their affiliate channel is just something built on later when you’ve run out of search and run out of social and you run out of all the other channels that you run and that’s not just the fact. Affiliates are actually the best at what they do in various respective niches and it’s one of the first places you should go and try to partner with them and give them value so that they will help you in selling your product.
Dan: Yeah, treating them as an important business partner for your business not just, these guys, some bunch of guys that are going to make some money off my brand.
Matt: Right and I’m just here. I just exist to slap their hand when they get out of line. That’s not really the appropriate way so I would say that any business when you take to look at it is really figure out who your champions are. In the case of affiliate, you need to build brand champions. In the case of when I work with Mercedes Benz and we were selling the smart car, we needed brand champions. People that were in cities and were innovative that wanted to espouse our brand and they got to excited about our brand. We have to build brand champions. Then, those were the cities we could launch the smart car into because we had built champions in those cities.
We had to do events that built champions, to show them the car. We have to do focus groups. We have to find ways to build that champion. In your business as an entrepreneur, it comes down to are you the person to run your business and to build champions and to influence others and basically when it comes down to it, to sell yourself, to sell your business, to sell your vision and sell your product.
Dan: Fantastic, so well, let’s take a quick break and we will be right back.
Dan: Welcome back, we are talking with the CEO of Smarter Chaos, Chief of Chaos, Matt welcome back.
Matt: Thank you so much Dan.
Dan: Matt, so that’s how you do a lot. Talk to me why you got out of that and transition into Smarter Chaos from the Click Bank days to Smarter Chaos, what happened or what have you learn from those experience?
Matt: Well, we went from the Click Bank days of Survey Scout and then we transition into building ROI Rocket which was really a top 25 affiliate network at that time. But what I realized in building something like that was it was a very transactional business and what I mean by that is that there wasn’t a lot of value being added. Sure we could recruit affiliates for a program and then we paid affiliates but here was very little value from there on that we were really building.
It was get the numbers higher, sell more products, get more affiliates, sell more products and that cycle is like a hamster wheel and honestly, when you look at that and try to pitch yourself to an advertiser, the people with the check book and you can’t really pin point what your value is, except that you can just do more and more and more that’s a slippery slope because they can always find somebody else that does more and more. So what you have to do is really look at, where are the holes in the market? How can we address those holes in the market and what kind of product or service can we bring the market is someone would pay for to address that pain or that hole? So I read the book called the eMyth. Have you read the eMyth?
Dan: Of course, Michael Gerber. Absolutely.
Matt: Yeah for sure. He talks a lot about filling that hole and then working on your business rather than in your business. So I took those two principles. I went down to Mexico. I sat on the beach, I had a margarita and I took my sketch pad out and I drew out the ecosystem of online marketing and what that looked like and it looked very chaotic. You had advertisers trying to come into the space, a bunch of networks in the space, a bunch of brokers, sub affiliates, sub-sub affiliates and it just, the line started to looked like a tangled web.
So I look at that and I thought, well, I wrote the words “manage the chaos” across the page. And I said, look, I bet it would be extremely valuable if we went to large brands, people that had spent a lot of time thinking about their product and their service and to establish themselves as a brand here in the United States and if we could help them take that brand, protect them as they launch online against any of the perils that may exists there, help them to get to a positive ROI very quickly, I bet they would pay for that. So, we built Smarter Chaos based on it.
Dan: That does how you get with the name?
Matt: That’s correct.
Dan: That’s awesome.
Matt: The name could be smarter about that. We could do this better than most brands could do for themselves and more profitable. We launched Smarter Chaos as a way to acquire customers for brands online in a way that it was profitable and made sense for them and probably better than what they can do for themselves. From that, we ended up building the bunch of other businesses. One was called sheismedia.com which is a blogger network. Again, it’s all around customer acquisition but the angle there is that we worked with blogs which they take a different type of handling and working with them and tool set.
So we worked with blogs and influencers to drive sales on an affiliate basis to large brands. Some of our, the brands that we worked with have been Group On, ZooLily, Uber, etcetera, etcetera. It’s great. We get to work with people with great ideas, great content, at She is Media and then we get to work with big brands that have viable products and put them together and help them formulate something big and ultimately drive sales.
Then we also from that we had the opportunity to buy a platform called pollen-8, it’s pollen-8.com and pollen-8 is a reviewer platform. Someone can launch a product by logging into our platform, putting up a video without their product or writing up something about their product and then we have over a thousand reviewers that have blogs, Instagram, Facebook, Twitter accounts and they apply to the program, the advertiser can choose which influencer they want to write about their product. They send them free product and the influencer writes about their product.
Dan: So, Matt on the surface from someone observing maybe, you’re not to get involved with different businesses but there’s an underlying theme and actually called that stacking that they might seem like you diversify, you involved with different businesses but there’s actually a synergy amount on each piece in business.
Matt: Sure, it’s looking down the value chain, where can we add value in this ecosystem and the ecosystem that I’m talking about is driving customer engagement and customer acquisition online for the brand.
Dan: Then this will also you have a little bit more control because you own those companies as well.
Matt: Yeah, that’s correct, I mean, another natural thing would be to own my own brand but we have another couple of companies going right now.
Dan: That make sense. That’s fascinating. Matt what is your business model at Smarter Chaos like how do you work with client? How do you charge them?
Matt: Absolutely, when we bring on the client, we engage with them for 12 months, they pay a small fee to engage with us and have our masterminds work on their business. We have account strategists, client services and planners that work on your business. They pay us a monthly fee and then we get an override of the additional sales and commissions that we drive through that program.
Dan: A lot of that performance based?
Matt: Pretty much all performance based. The fee that we charged is to really to separate the chaff from the wheat. That the cream from the rest.
Dan: They have skin in the game so you will know they’re serious.
Matt: Absolutely, everybody wants you to work for them for free but how many are willing to actually pay for your expertise.
Dan: Make sense. It’s actually very similar to my business model. It’s fascinating. I didn’t know that but it’s awesome. I totally get it, their successes is your success and the more money that you help them make the more money you make.
Matt: Yeah, if you provide value to someone that has more products than you or bigger brand, then they will pay for it, they will keep you around and you can really built your business in a culture of service and so we say across our organizations that we have a culture of service providing valuable service, something that people value every day that we worked with them. We’re not going to go anywhere. They’re not going to let us go. We’re not going to want to go as long as we’re providing value back to that customer.
Dan: It’s almost from the business, the transactional business now. I call this as transformational relationship.
Matt: Yeah, I like that.
Dan: Yeah, it’s transactional versus transformational which transforms the business or transform they market their business their brand and we don’t have to worry so much about getting the next client, chasing the next deal. No, we just take care, nurture the clients that we have and then help them grow.
Matt: Yeah, absolutely, I’ve learned probably over the last five and a half years as we built Smarter Chaos that you don’t need to chase down every client. You just need to chase down the ones that are willing and wanting to work with you, the ones that are willing and wanting to pay for that and the ones that value you for the long-term to become a partner and you only need a few of those to be very honest with you and you can grow with that but all those things have to be in place.
Dan: I like the word, I use the same word. I don’t even call them client, I just call them partner.
Matt: Right I like that.
Dan: Because essentially, that’s what the relationship is and I tell people that I’m not looking for client, I definitely not looking for a customer because customer is and I always say in a Walmart has customer.
Not Vendors but Partners
Matt: Yeah, exactly. And we started to say this last couple of weeks that it’s not the business that we want to work with it’s the people that we want to work with.
Dan: Talk to me a little bit more about that like what kind of people do you like to work with?
Matt: We like to work with people that are not, we don’t want someone to treat us like a vendor for example. We want them to be site as partner. We want them to know when we make a mistake and we want to know when they make a mistake. We want to know that when we plan things and we say we just need to execute these things to be successful, then we’re both on the same treadmill, the same battlefield, we’re doing the same blocking and tackling. Those people that will block and tackle with us instead of being on the sidelines and telling us what we’re doing wrong, then those are the partners that we really want. Those are the clients that we want to work with and work for.
Dan: I’m curious Matt, when you’re working with these big corporation, who’s your main key contact like who do you work with from the corporation usually?
Matt: It’s really interesting and a lot of times, we either have a CEO reach out or CMO reach out. They says my marketing team doesn’t know it yet but I love what you’re saying, what you were doing out there, I want you to work with them. You get the challenge at that point because then you still have to create champions in the business because you still have to work with the marketing team and help them understand that we’re not here to replace you, we’re here to help you. We’re here to make you look like the rock star so that when the quarter is over, you get the award, you get the medal, you get the kudos. We’re just doing a work behind.
Dan: They get the credit and then you got the cash.
Matt: That’s the other side.
Dan: Do you sometimes get resistance from them or usually it’s okay after explaining what you are there to do?
Matt: That’s really comes down to the people so we have clients that have worked with us six times now. It’s six different things and again we follow the people and sometimes we get left with the client because the person has left and then we have to build yet another champion, another trust relationship, another set of values. So we’re always selling even with current clients.
We’re always building the brand and building our relationship with that client but a lot of times, yes, there’s a lot of suspicion when we come in to an organization because change scares everybody and you do have to be weary of people that come in and say they know everything. We don’t do that. We come in and say, we want to learn what you know and hopefully, we can help you as you tell us what you know about the business and we’ll be additive to that, to what we know about marketing.
Dan: It make sense and Matt what we did with clients of course, you have a great reputation. You’ve been doing this for many years like for someone listening to this podcast like, Matt how do you get those like big corporations, how do you attract those clients? What do you do?
Matt: Well, we do the lot of cold calling in the beginning to be very honest with you and I relied a lot on relationships that I build over 15 years of doing internet marketing. Just to be very honest with you, sometimes you just have to open up your roladex beg and you have to say, do you remember that time that we did this together? If you value that, would you try to do it again with me? Would you mind doing that again with me and if I could earn money and you only paid me when I earned money with you, would you be willing to do that with me again and we had to do that.
We had to call through a rolodex, call through our LinkedIn, go to our Facebook, go to our friends and family and say do you know anybody that needs marketing. From that we built a layer of trust, a foundation of trust and then on top of the layer of trust we start to build in referral systems where hey, if you know somebody that could benefit from the things that we’ve done for you, we’ll be willing to pay you a percentage of what we make on that account and we’ll work for them on performance.
Then on top of that we then had to build in credibility on top of that layer and the credibility really came from the past and the present of what we were doing. So it’s the past accounts that we were working on and then we had to build present communication to what we were doing for those clients. We had to go out there and put boots on the ground at conferences. We had to be at events to mingle and so on, and really it was about creating a grassroots buzz of what we were doing.
Dan: I love it because I see so many entrepreneurs that they are not willing to do the dirty work because I want them to hear this from you because sometimes I hear them, oh yeah Dan, another Facebook campaign or Twitter, no, what you need is pick up the damn phone and call people.
Matt: It’s actually right.
Dan: You followed your mentors teaching in sales, it’s just pick up the phone and doing the ground work and meeting with people building relationships.
Matt: That is the first thing I asked anybody in my organization. If operationally we can’t get something done, software is not working or we are not closing a client, or an affiliate is not driving a type of sales. The first thing I’ll say is, did you pick up the damn phone? Did you call them?
Dan: Yeah, it’s crazy, isn’t it?
Matt: Right. We something called social capital. we have something called the emotional bank and Dan if I do something for you that creates a credit in the emotional bank and I built that with you and I get more and more credit with you then when I pick up the phone and I call you later, you’re going to let me debit with that a little bit. You’re not going to let me call that out later and there’s a favor in there somewhere.
Dan: Absolutely and that’s the easiest way to grow a company is to build those relationships and you add value to people’s lives without asking for anything in return. Just help a whole lot of people and they will want to help you back.
Matt: Just be a good person. My wife and I talk about this all the time and her name is Hunter and I say, Hunter, when I wake up in the morning, there is truly one thing I want to be. I don’t always do it. I don’t always hit mark but when I wake up in the morning, I want to be a good guy. At the end of the day, I want to be a good guy and what that means is a good guy for you to be in business with, a good guy for you to be married to, a good guy for my kids to they have as a father and a good guy all the way around that when they comes down to crunch time, I’ll make the right decisions and you know I’ll make the right decisions and the people know that about you if you have integrity. You can build a business on that. You can build a business on that integrity no matter what it is because people know that they can go to you for expertise and integrity.
Dan: And they can count on you.
Matt: They can count on you, and you’re going to deliver.
Dan: I absolutely agree. Nowadays, just building a reputation, adding value and just helping people all around and you’ll see, I mean all the money, I will say a majority of money I made is I have a friend, hey Dan I’m doing this deal or I’ve got this opportunity. I want to do this. It’s just the phone call.
Matt: I can say people a lot of time on this podcast all those things that automate your tweets, all those things that automates your Facebook, all those things that make you look big when you’re not, all those things that people are trying to sell you out there forget about it. Don’t do it. Just pick up the damn phone and call people that trust you and ask them if they’ll trust you again with this product. Ask them.
Dan: And for you guys that are listening, oh but, Matt and Dan, I don’t think I have a lot of people that trust me. Then we’ve got a problem. We have a whole different set of problems.
Matt: if you have to create a separate Twitter account for your business because people know who you really are, you might have a problem.
Habits of a Successful Entrepreneur
Dan: Matt I also want to talk a little bit about your personal habits. What habits you believe that are the most important to develop to be a successful entrepreneur?
Matt: It takes discipline and it takes a lot of self-reflection to be very honest with you. That discipline could range but it can include the discipline of waking up early in the morning and working out. It can take the discipline of planning sessions at night before you go to bed but it takes discipline and structure for you to accomplish your goal. It doesn’t mean that you can’t create a time for fun and a time for formality and have that relationship with your family and friends but it does take very strict discipline to execute.
So we always use this target execute measure. I try to do that in every business that I do. So I target what it is that I’m trying to do, I execute against it and have a plan for the execution including all the resources and people I need to do that and then I measure how successful that was and then I tried to win some more of it. Now, as far as discipline goes, you have to be able to have the discipline to create routines, to create structure, to create processes. When businesses don’t have processes and they don’t have repeatable processes, they cannot be replicated in the future and you cannot scale based on that. You have to be able to sit down and have the discipline to say, how do I replicate this? What’s the process to replicate that? If I got hit by a truck tomorrow, could someone else replicate that? How am I going to grow on that? So a lot of discipline.
Another part of the habits is also allow yourself to have fun so that’s the flip side. I own a house in Breckinridge. I ski hopefully Friday through Monday. I have dogs in my office, two Bernice mountain dogs. I have a jeep that I love so much that is, it has 37 inch tires and I don’t want to—My wife and I take trips all the time. I just came back from Washington DC and New Orleans before that. Discipline doesn’t mean starving yourself from fun or creating that lifestyle that you have to be working all the time.
Discipline means being effective in the hours that you do spend building that business because a lot of people, equate being an entrepreneur means that I have on all the time, business, business, this is my product. Look at my product. See what I’m doing. Tweet about this. Facebook about that and they don’t know how to separate that from their personal life and they need to realize that business busy doesn’t mean effective. I know that Tim Ferris did the extreme by writing the Four-hour Work Week and I always laugh, I don’t know why not the two and a half hour work week but I don’t know if the four-hour work week is a myth or not. What I do know is Tim Ferris has something there when he’s talking about setting up systems for the productivity and when he setup repeatable thing that you know you can make money at and you know that you can step away from it and it will run in the background.
Dan: And I always say to people like I think the foreword, I love the book. Don’t get me wrong.
Matt: Great, very inspiring.
Dan: Tim is a great guy but I think people sometimes taking out of context that if you have observe what Tim is doing. Tim is not working four-hour a week believe me.
Matt: Right. He didn’t work all the time.
Dan: He sleeps one hour a week. It’s not like that. It’s not like an excuse to be just lazy and then we are talking about working smarter, leverage process, having systems in place, all those are good points.
Matt: Yeah, and the repeatable part of it is very, very important and really sit down and look at what is repeatable and if it all has to be done by you, if you’re the only person that could do those thing, that’s not a business. You’re a consultant.
CEO’s Most Important Job
Dan: Correct. So Matt, as a CEO what do you think is the most important job that you have to do? Is it to develop, key relationships or like what would be your most important job?
Matt: My most important job is to coach. So, I view that every meeting I am in, every person that we hire, every advertiser that I talk to I’m a coach. When you look at coaching because I coach a seven-year old soccer team and I’ve been coaching at for how many seasons, when you look at coaching, you have to know the right players to put in place, the right plays, you need to plan the game, you need to practice. A lot of times, we forget in business that we need to practice things. You can’t just go out and play a game cold. If your sales team isn’t practicing, your operations team isn’t practicing then you’re doing yourself a huge disservice because there’s a probably a company that is practicing.
What I mean of practicing is, you have to sit down and coach your folks in this scenario this is what I would expect, in this scenario, this is what I would expect but also, you have to bring out the best of them. Coaching isn’t saying shoot at this time and you make a goal. That doesn’t work that way. You don’t say, hey, kick it this way and that guaranteed the goal every time. They have to be able to juke and dive when they’re on the field and know the basic plays that you’ve given them and the basic training that you’ve given them but when they’re on the field, they need to know how to make that split decision and they need to know how to score, how many times they’ve scored and what a win would look like when you get it. I think coaching is the number one thing that I do on a regular basis.
Dan: Matt, that’s probably the most profound answer I’ve heard from the role of a CEO. Wow! And the coach is amazing. I think that’s summarizes it very, very well.
Matt: From a coaching perspective, coaches are probably been there done that themselves. They’ve been in the game before. They played a lot of the positions. They’ve studied the game. They’ve come up with the game plan. They bought all the things you need to play the game. I even buy the bench that my players sit on so, they don’t have to sit on the ground. I bring the snacks. We’re there for every single celebration and we’re there for every single defeat and as a coach, how do we handle the defeats, how do we handle the successes. I think it’s a really good analogy and when I’m sitting in meetings, I literally think back to what would I do with it?
Dan: We always try to bring the best out of them and develop leaders and as a coach then we’re also concerned that our people smarter than us. We want them to be smarter than us. We want them to be better than us.
Matt: Well you can’t just say the old attitude is hire people that are smarter than you but then what? You didn’t give them a game plan. You didn’t tell them what your goal and your vision was to win that game. You didn’t coach them along the way and help them practice and sharpen their skills. You can hire smart people and get out of their way, that’s fine and that might go 50-50 for you but hire people that are smarter than you and put a flippin plan in place.
Dan: And this if you have to bind your culture, what your vision, what you’re trying to accomplish as accompany.
Matt: I say, sometimes I’m also not only a coach but I’m cheerleader because when people are down around here, I’m walking in the room, doing, good morning. When I see that everybody is exiting out of the office at three o’clock to go get a beer, I know something’s wrong. I need to go figure out and have a beer with them and sit down and say, what is it today that made you leave like that and do that or if we’re having a celebration, I need to say, what lead to that? That’s great. What did we do right? You need also to celebrate the success with your organizations as well as be able to handle the defeats and know what to coach in and get to the next level.
Dan: That’s awesome. I could just imagine like your team probably is like a one big family.
Matt: Yeah, absolutely. I need to paint a picture for you we’re in this great building in downtown Castle Rock. It looks like a Norman Rockwell painting in Middle America. We have very talented staff that have backgrounds that range from rocket scientist to engineers and so on and this group of people works hard every single day but were attached to a beer garden and we have a tab at the beer garden and when things, the pressure cooker gets a little bit hot in our office, they relieve it by going next door and having a good time and we have dogs that roam through the office, we have bikes, mountain bikes on the walls. I encouraged us to give ski passes. I mean we really try to create a culture of family around here and really get each other’s’ back.
Dan: That’s fantastic. Well, Matt, any final thoughts and maybe you can also share with us your contact information. I know you have a Twitter account from Smarter Chaos so if our listeners, want to learn a little bit more about what you do, they can get in touch with you.
Matt: Sure. I think that my final thought is, I’m sorry to say there is no silver bullet. People always say to me, what is the silver bullet, how can I become successful? I say, well, if there was a silver bullet, it wouldn’t have taken 15 years to do it okay. So it takes a lot of hard work and all the things that we talked about today, the things that you talked about on your podcast prior to this podcast, those are all things that you need to become coachable back to that theme.
You need to become a student. Remember how to learn again and take that knowledge and turn it into something to achieve your goal. I think to become a good business owner, become coachable, become a student again, learn about all these different things and at the end of the day, find out how when that game comes around, when you launched that product or that business be ready to step into the coach’s role and help others learn and help others get value and drive that. That’s probably my parting thought.
Dan: I love it.
Matt: Yeah, so the best way to get in touch with me is on Twitter @ChiefofChaos. You can also go to www.smarterchaos.com.my email is firstname.lastname@example.org and please contact me if we can help each other out or if you just want to follow up with me.
Dan: Matt, one last question before we go, one last question. I want to circle back to the beginning where we were talking about how you see success, how you define success, how this you define success let’s say 10, 15 years ago and how do you define success today?
Matt: Yeah, I define success back when I was in college as I wanted to get a good job that paid well and once I’ve got a good job that paid well, I said, I want to rise in a corporation to become at an execute level and I did that by about 24, 25 years old. Once I’ve done that, I said, well, okay, let’s raise that bar again and I said, now, what I want to do is I want to make a million dollars by the age of 30 and I want to run my own business successfully and I did that. I said, okay, now I’ve done that, I now want to make as much money as possible and looking back at that, I think wow! That was just kind of foolish because that’s not really the end goal.
As I get older I started to realize, it’s for me, success is about the time that I gain. Time is the most precious thing that we have in this world. You can exchange time with somebody. You can charge for your time. You can offer your time in sport or volunteerism. You can spend the time with your family but time is something you’ll never get back. You better charge well for it, spend it wisely and don’t let others use it when you didn’t intend for them to do it. I look at it and I say, am I spending the time, the way that I wanted to spend my time? Am I charging for my time the way I should be charging for my time?
At the end of the day, it’s a lifestyle thing. We were talking a little bit about this earlier this is the lifestyle for me now. If I can ski, if I can spend time with my family, if I can go on vacation, those are things that are interesting to me not fast cars, not big houses, not how much money I make, it’s about the time that I get to spending it the way that I want to spend it on the lifestyle that I choose.
Dan: Matt, you are awesome. I appreciate it and thank you so much for inspiring us today with your story, your struggle, your transition, your lessons learned, your success. I appreciate it. Thank you so much.
Matt: Thank you so much Dan and to everybody listening out there, just get out there and do it just go.
Dan: Awesome, just go and do it.