Build a Business, Not a Job

5 Simple Steps to Grow Your Company

Tom, owner of a $5 million per year company in Florida, sure his business was successful, generating $1 million per year in profit, but he was working 80 hours a week, missing his family, hurting his health, and damaging his marriage.

Tom was torn between his desire to see his business succeed, and being present with the important people in his life. Sound familiar?

Too many business owners think they must make a choice between growing their business and having a life. But this is inaccurate, old-school thinking.

If having helped thousands of business owners build billions of dollars of sales and enterprise value has taught me anything it’s this: the best way to sustainably grow your company is to focus on less, so that your business can produce more, and in the process, you greatly simplify your task of reducing your company’s reliance on you the owner.

Done right, you get your increased sales and profits, and you get your life back again.

Let’s go back to Tom to hear how the story turned out. After 7 years of applying the S.C.A.L.E. Formula to grow his company (which I’ll be sharing with you in this article) Tom grew his sales to $20 million. Best of all, he reduced his working hours in the business to fewer than 10 hours per month.

Tom Santilli (far left) enjoying a celebration with his business owner peers in Maui. Seven years after first applying the S.C.A.L.E. Formula, Tom grew his company to sales of over $20 million and transitioned to own his business passively.

Tom Santilli (far left) enjoying a celebration with his business owner peers in Maui. Seven years after first applying the S.C.A.L.E. Formula, Tom grew his company to sales of over $20 million and transitioned to own his business passively.

The main point of this article is to give you better formula of the key steps to grow your company the right way. A formula that doesn’t require you to sacrifice your health, your family, or your life to get that growth.

It’s my hope that this formula sparks you to think about your business in a new way. And to reconnect with the possibility that you can fall in love with your business again.

The Big Picture of the S.C.A.L.E. Formula

Growing your company can be a difficult task, especially if you have no concrete marketing strategy or know where to begin. Many business owners believe that they have to choose growing their businesses over their personal life in order to succeed, but this is a very common old school misconception. After many years of helping business owners, we found that the best growth strategy for your growing business is actually to focus less on the company, so that your business has space to grow and produce more. 

One of the greatest tools that we have to help you grow your business is using the S.C.A.L.E Formula. This formula was derived from the key fundamentals of the 272-page book called SCALE. We designed the S.C.A.L.E formula as a way to help you organically grow your small business without the expense of your health and personal life interfering with the business growth. Here’s the big picture outline of the actual formula for growing your business and getting your life back.

It’s based around the five letters of the word, “SCALE”.

 

Step#1: “S” Stands for “Say Yes to Building a Business Not a Job”

The “S” in S.C.A.L.E mainly focuses on recognizing the possibility of creating a business independent of yourself. This is something that is especially challenging in a new business setting because the need to know everything going on in the business typically gives us a sense of security, but this micromanagement tendency can lead to a problem in the long run. 

My Story

I started my first “real” business at age 23 when I dropped out of college to start distributing a nutritional product in San Diego, California. Prior to this, I was a semi-professional athlete training for the Olympics for field hockey. Although I was excited to begin my journey as a business owner, I realized that I’d jumped into a business without understanding the basics of how to grow a business, how to be an entrepreneur, how to drive business success, etc. I’d never invested the energy to learn the skills needed to build a successful business. I was simply chasing after the glitter of easy profits.

That was my wake-up call.

They say the first sign of progress is admitting you have a problem—and boy, did I have a problem. I was scared, overwhelmed, and feeling stuck.

I didn’t understand how to sell or market; I had no skill in how to structure or run a business; and I had no clue how to manage cash flow and build financial controls.

I had let my ego-fed pride blind me to my own ignorance and isolate me so I didn’t look for the right mentors, advisors, and peer group to guide me.

Going bust helped me to break through my fear-based bravado and understand that I had a lot to learn. And learn I did. Changing my ways, I began to study, read, experiment, find mentors to learn from and partners to contribute with. Seven years later, I was an “overnight” success—a multimillionaire with two successful companies and a bright entrepreneurial future ahead of me.

But now I had another problem—a serious problem. I was totally burned out and overwhelmed.

Working 70-hour work weeks and being on the road 2 weeks each month, I was in danger of losing my passion for the business because of all the “details” I was responsible for overseeing.

Sure the money was great, but this wasn’t what I’d signed up for. I originally started my own company because I wanted to be in control of my own destiny. I didn’t want to work for anyone else (that is, if anyone else would’ve had me). But in the end, I wanted one thing more than anything else. I wanted freedom. Freedom from people telling me what to do and how to do it. Freedom to do things my way. Freedom from having my future depend on the whims or decisions of others. And—gulp—time freedom.

Instead of constantly working to feed my business and feeling trapped, I wanted to let my business work for me. The cash flow was great, but I always had to anticipate the pressures of the following month. From figuring out new ways to keep myself afloat, such as dealing with employee payroll, constantly finding a new business growth strategy to drive brand awareness and appeal to the target market, or handling emergencies, I knew I had to find different ways to make this doable or else.

It was at that point I made a decision. I’d build a business that would work without my showing up each day. I focused on it, obsessed over it, took action on it. And little by little, my business started to mature. I found key team members, built strong operational systems and internal controls, and slowly weaned my company off of its dependency on me.

Over the next 36 months, my income skyrocketed, but best of all, my free time kept pace. I had reduced my working hours from 70 hours per week down to an average of 35 hours a week. I had increased my vacation time from never to two to three months a year. I was doing the things in the business that I loved out of choice, not obligation, because I’d crafted a role for myself in the company that was both sustainable and enlivening.

At this high point, I got such a good offer to sell the companies, I decided to do it. I took the money—along with everything I’d learned about building a successful business—and started fresh, and did it again.

The reason I share this with you is simply to illustrate a point – it is not only possible to build a business that doesn’t rely on you, but that should be your goal.

In fact, the first element of the S.C.A.L.E. Formula calls on you to make the concrete decision that one of the stated goals of your business is to build it to be sustainable independent of you.

 

Step#2: “C” Stands for “Claim Back Your Time”

The “C” in the S.C.A.L.E. Formula stands for “Claiming Back Your Time”.

It is inevitable that growing a business will take an enormous amount of time, but there is a difference between working harder and working smarter. In the beginning, it will be hard to claim back the hours, especially when establishing a foundation with your employers. However, there will come a time when the foundation is established and your time needs to be focused on other factors in order to grow.

Here’s the thing, you’re already working enough hours. I don’t want or need you to work any harder. You just need to carve out a small percentage of the 40-50-60+ hours you’re already working each week, and to invest in higher order activities to help you scale your company.

But when you first try to do this everything in your business day is going to fight back to make it hard for you to claim back these hours.

Your staff is going to need you… your customers are going to cry out for you… your vendors are going to ask for you…

You’re going to say, “But David, I’m already working 70 hours a week. I just don’t see how I can fit in the suggestions you’re making.”

This is why the purpose of step #2 is to help you structurally find 4, 6 or 8 hours each week of your best time to reinvest in upgraded uses in your business. It is crucial to have these hours blocked in, so you have a concrete time to get valuable work done.

Take the example of Bob, who is the business owner of a successful industrial products company in the western U.S. Bob’s business has generated a healthy 6-figure income for Bob, but he has had to sacrifice his time running all the day-to-day operations and manage his small team each day. He felt torn because while there was a part of him that wanted something more – more growth, more profitability, and more time freedom, he just didn’t think he had the time to do anything about it.

Bob’s situation is not something abnormal, in fact many small business owners experience this as well. Too busy doing the “job”, Bob cannot make time outside to try out new solutions to fix the chromic problems in the business or try out new marketing efforts to reach prospective customers. That makes about as much sense as the person digging a hole who says, “I’ll stop digging as soon as I reach the bottom of this hole.”

So the key with this stage of the S.C.A.L.E. Formula is for you to structurally claim back 4-8 hours of time each week, hours that you were already working, and redirect these hours into higher value activities.

When Bob followed the formula and did this he grew his sales 33% (taking his sales to $2.4 million) while increasing his profit margin. Best of all, he also increased his company’s “Owner Independence Index” by 133%.

So while it may be easy to blame how busy you are as the reason why you can’t scale your company, doing so is both non-productive and misleading.

You do have the time. It’s hiding in the very hours that you’re already working.

You just need to claim back a small percentage of them (in Bob’s case he started with just 7% of his working time) and invest those few, precious hours into upgraded uses growing your business the right way.

 

Step: #3: “A” Stands for “Align Around Your “Fewer, Better””

After reclaiming a small block of your time each week, this is where the “A” in SCALE comes into play. It says to, “Align Around Your ‘Fewer, Better’”.

On one level this is where you personally will be focusing your freed up blocks of time. On higher level, this stage in the S.C.A.L.E. Formula means to systematically get your whole company to focus its best resources of time, attention, and money around those things that make the biggest difference to your company’s success and growth.

You don’t need your team to do more, you need your team to do better. What are those fewer, better things that if you and your team consistently invested your best resources in would yield the greatest growth and progression for your company?

This section of the formula is based on 4 simple tools that work wonders helping you to identify your top leverage points and then to consistently organize your resources to take best advantage of them.

These four tools are:

  1. The “Sweet Spot Analysis” Tool
  2. Your “S-O-O-T Review” Tool
  3. The “Starve Your Losers; Feed Your Winners” Tool
  4. Your one-page “Quarterly Strategic Action Plan” Tool

 

Step #4: “L” Stands for: “Leverage Your UBS as the Doorway to Start Systematizing Your Company”

To increase your company’s capacity, sustain your growth, and increase your company’s Owner Independence Index, you’ve got to build, use and refine systems and controls.

The “L” in S.C.A.L.E. stands for “Leverage Your ‘UBS’.

Your “UBS” is the master system of all your systems, and it’s the doorway to begin the process of systematizing your company.

I’ve been helping business owners for two decades now create systems driven companies, and the UBS concept is by far the single most effective best practice to enroll and enlist your team on becoming a systems driven company.

Execute with “ACR”

 

Step #5: “E” Stands for: “Execute with “ACR””

The “E” in S.C.A.L.E SCALE stands for “Execute with ‘ ACR’ “. “ACR” is the missing ingredient for actually turning the S.C.A.L.E. Formula into tangible, reliable results for your company. It’s the 3 layered fuel to get you to execute and implement on the other four elements of the formula.

Without taking action, the formula is just a dead methodology. But when you take action and follow it, the results are amazing.

Results like:

  • Paul Robinson, of Ensunet Technology Group, who over the past 24 months, took his one man, high end I.T. consulting company to sales of over $1 million per year, while increasing Owner Independence by 400 percent.
  • Liz McDonald and Patrick Blood, of Blackwell Realty, who over the past 24 months, grew their boutique property management and brokerage company by 463 percent, at the same time increasing Owner Independence by 600 percent.
  • Caleb and Tobias Preston, of Alaska Financial, who over the past 24 months grew their financial services firm by 121 percent while at the same time increasing the Owner Independence of their firm by 60 percent.
  • Dr. Tom Umbach, of Blossom Bariatrics, who grew his surgery practice by 50 percent while at the same time increasing his practice’s Owner Independence by 280 percent.

If you would like to get the in-depth details of how to apply the S.C.A.L.E. Formula to grow your company and reduce its reliance on you, then please join me for a special webinar training I’m doing that’s coming up very soon.

The webinar is FREE, and you’ll learn the full formula and get a detailed progression for the best way to apply the formula in your company so that you can see results starting in as little as 28 days.

Essentially this web training is my very best version of what I’ve been teaching business owners to do for 20 years now. It’s helped them create billions of dollars in sales and enterprise value, and this is your chance to learn the complete formula for yourself.

Simply click here to register to join me for this free training.