Born to Russian immigrants, Mel Ethan Cutler was diagnosed with cystic fibrosis as a baby. Despite the challenges that faced him, Mel became a serial entrepreneur at 19, starting six companies over a 10 year period, two of which evolved into seven-figure revenue streams. He actually semi-retired at age 25 to an island! Eventually, however, after several years of world travel, he realized there was more to life than just making money and founded Success Academy, his business training company.
Over the last 10 years, Mel has had a phenomenal impact on the lives of business owners from all walks of life, in many different nations – more than 100,000 business owners. With his work in business psychology, negotiation, organizational turnaround, peak performance and team leadership, he is not only a serial entrepreneur and world traveler, but a business revolutionary.
Mel, who is also author of best selling book, “BIG BOOM: How To Get Explosive Results In The Entrepreneur Revolution” and several different professional improvement systems, has been honored by Icon Media as one of the “Top Entrepreneur Trainers in the World.” He has addressed such distinguished audiences as the USC entrepreneur club, CEO Space, and the Young Entrepreneur Society.
Listen to this episode to hear Mel chat with Steve and Mary about how he has dedicated his life to helping entrepreneurs discover and put into action the tools, strategies and resources to create extraordinary results and amazing levels of personal and business fulfillment.
In This Episode
1 – Full House; Born To Russian Immigrants; Diagnosed With Cystic Fibrosis As A Baby2 – The Entrepreneur Revolution; 7 Deadly Mistakes Business Owners Make [13:19]3 – Negative Emotion & Fear Of Changing; The Best Entrepreneurs Are Detached; Setup Your Business To Sell [26:05]4 – More 7 Deadly Mistakes; Be Aware Of Limiting Beliefs; Effective Sales Funnel & System [38:52]
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Steve: Well, alright, alright, alright. What is going on everybody? How we doing? Welcome to another edition here of Reinvention Radio. We’ve got a very full house.
Mary: Yes we do.
Steve: I love when we have a full house. Full houses are good. And, by the way, I will readily admit that I was speaking of full house I still look at – which girl? If you had to choose one of the twins, which would it be? If you had to choose one of the twins. Rich, which one would it be?
Mel: Can we choose both? Is that possible?
Steve: At the same time?
Rich: It’s twins.
Steve: There we go. They’re twins.
Mel: That’s why it’s called Full House.
Steve: And have you…
Mary: I don’t know what you’re talking about. The show Full House…
Steve: Mary Kate and Ashley…
Mary: Oh… Did they go through a weird phase in the 20’s and 30’s?
Steve: I hope so. So, full house today. We’ve got wow! Lots of folks here, we’ve got Kate. What’s up, Kate? How are you? Yay, welcome. You’ve got to turn around and show Kate. And there is Kate, the lovely Kate who would be Mel Ethan Cutler’s better half, no doubt at all about that, which means that Mel Ethan Cutler actually is the other half that’s with us here today. So, what is up my man, Mel.
Mel: Hey, thank you guys for having me on the show. Appreciate being here. I’m excited.
Steve: Absolutely. Along with the lovely Mary Goulet and the Rich Otey in the house. How you doing, Mary?
Mary: Doing well.
Steve: Good. So, lots of interesting things going on, not the least of which is… First and foremost for those who don’t know Mel and because you’re here, we’ll do things a little bit differently, because typically in the first segment if you listened to Reinvention Radio before, then you know that we usually just shoot the shit a little bit and talk about what is going on in the world. But let’s do this. Because you’re here and you’re going to join in on the combo, give people an opportunity to understand who you are, what you do, and what’s got you psyched for the rest of 2016 right now?
Mel: Yeah. Absolutely. So, who am I?
Steve: Who are you?
Mel: I’m a guy who was definitely unemployable, had to find my own path, didn’t have much support growing up and I realize that the only path to financial freedom and time freedom was owning your own business. Now, so many people they think they know how to do it but they don’t and then they turn their business into a job and then that’s what it ends up being for the rest of their life.
Mel: And when I was growing up I was born to Russian immigrants, and so…
Steve: Really? What part of Russia, do you know?
Mel: Both my parents. Yeah, my Mom’s from Odessa…
Steve: Where’s Odessa in the scheme of things?
Mel: In the Ukraine.
Mel: And my Dad was from St. Petersburg.
Steve: When did they come here?
Mel: They came to Canada. They emigrated from Russia to Canada. I was born in Canada, so I’m actually Canadian, eh?
Mel: That’s where ey comes from. And then as a baby I was actually diagnosed with a genetic disease called cystic fibrosis.
Steve: Oh, God, really?
Mel: Yeah. And actually I’m missing the luncheon today to be here with you guys.
Steve: It’s the one fundraiser of the year where they raise money for cystic fibrosis and you chose to be here with us.
Mel: No, no.
Steve: That is so cool. Thank you for that, Mel.
Mel: That’s how much I love you guys.
Steve: That is so sweet. We love you as well. And so wow! I don’t think I know. Do you know, Mary, what’s cystic fibrosis in terms of like how it affects people? I’ve heard the name but I can’t tell you what it does. Do you know?
Mary: It’s a muscular degeneration, or… I’m not sure.
Mel: Yeah. It actually affects the lungs and digestive system.
Mary: Oh, it does.
Mel: So, every time I eat, I take enzymes to help digest food. When I woke up this morning I strapped on a vest that literally shakes me to be able to cough up the stuff in my lungs.
Mary: So, it still stays in there. It’s being created – mucus is being created in your lungs.
Mel: Yeah. It’s basically – Cystic fibrosis…
Mary: From sleeping.
Steve: …is just excess mucous, right? And so that excess mucous, even though it’s actually trying to protect you…
Mel: …it ends up killing you.
Steve: Oh, God. So, what do you do to treat that?
Mel: So, there’s multiple things. And I’m very fortunate because I have a mild case of it, but 15 years ago kids weren’t living past 13 years old.
Steve: Oh, God, really. Wow!
Mel: These kids – and I’ve been hospitalized a couple of times. I mean, they spend their lives in the hospital and it’s so crazy because they can still put a smile on their face day-to-day.
Steve: Wow. That is unreal. So, at what point did you know? Like, did your parents – this is the thing you as a baby, does it affect you?
Mary: Oh, you’re born with it.
Mel: Oh, yeah.
Steve: So, you’re born with this.
Mel: Yeah. I would cry non-stop. I’d drive my parents crazy and they didn’t know what was wrong.
Steve: So, Mary, maybe you have cystic fibrosis because you’re crying all the time… I’m sorry…
Mary: That was stupid.
Steve: Sorry. So, wait! So, you were crying all the time because…
Mel: Crying all the time. I wasn’t gaining weight, that’s a key sign. Wasn’t gaining weight.
Mel: And so they brought me back to the hospital and if you can imagine all the negative emotions my parents were going through thinking what did we do wrong or what’s wrong or all the fear. And, which by the way not only affects our personal relationships, but also affects us when we grow and start a business.
Mel: So, they brought me back to the hospital, they did a sweat chloride test on me and they said, hey, your baby has this genetic disease.
Steve: Wow! So, from a very young age you had to take… So, is it a… Can they treat it through medicine or is it just…
Mel: Yeah. There’s a few treatments. So, one is there’s a couple of aerosol treatment that you can do from a saline solution to breathe that in to just other drugs that open up the lungs…
Mel: Exercise is good.
Mary: Meditation, anything that gets you to breathe deeply to try and…
Steve: Like a steam room or a sauna – I think sauna does the opposite, but steam will open you up, right?
Mel: Totally. Actually, I did that this morning.
Mel: As a matter of fact, Kate, the lovely, my wife…
Steve: The lovely Kate.
Mel: …she took her magic essential oils in the shower today and Eucalyptus in the shower…
Mary: I love that stuff!
Mel: …that was awesome.
Steve: My kid’s got kind of like mild Asthma and we have one of those little thingys…
Steve: Something like that and you put in the Eucalyptus oil and then it smells up the whole room. I think it smells kind of funky but evidently it helps. You like Eucalyptus?
Mary: I love Eucalyptus. Yes.
Steve: My wife is like – she’s one of those people who will go in a room and like cleanse it…
Mary: Yeah. Sage.
Steve: Sage. That’s the thing.
Mary: That smells like pot.
Steve: Well, no! Pot smells good. Sage smells like – I mean…
Mary: I’m the opposite. I don’t like the smell of pot, but I like the smell of sage.
Steve: Really? Oh, man. So, she’ll go into a house and she’ll be like, oh, yeah, I feel something in this house… And then she’ll go in and she’ll like “cleanse” it.
Mel: She’ll do a dance and then she puts on the outfit and she does a little song and a chant, is that…?
Steve: Yes, and… [Laughter] Very cool. First and foremost, what year – so, what year did they come to Canada and then what year did they come to the states? Because you’re flat out first generation. So, you are first generation, which is rare. Do you know any first generation people, Rich?
Rich: No. I was going to say I thought Gary V for a second, I was going to say the Secret to Success is being a Russian Immigrant.
Steve: Is being a Russian Immigrant. I remember that.
Rich: But he’s not. No, wait! He is too.
Steve: So he would be first generation.
Rich: Yeah. His parents came over.
Mel: Because his parents came… Yeah.
Mary: My Dad…
Rich: No, no, no, he was born there. He came at a very young age. But I don’t know any first generation.
Steve: So, your grandparents came here Mary and then your Dad was born here…
Steve: Okay. So that would make your Dad…
Mary: From Canada.
Steve: …first generation. Gotcha. Okay, very cool.
Steve: Quebec. Oooh, who knew? Alright, at what point did you guys come from Canada to the states? How old were you at that point?
Mel: When I was four years old they said, enough of the snow, enough of the cold winters…
Steve: Smart people.
Mel: Let’s go somewhere warm. And, so, thankfully, honestly, I thank them every single day. Like, they decided to fly south and west all the way to beautiful sunny Southern California.
Steve: So, at that point… So, you were raised in Orange County? Is that… And you’re in Orange County now still.
Steve: Alright. Very smart people. Now, your parents were much smarter than I am clearly because it took me 44 years to figure out that like you can actually leave. Like, I didn’t realize this evidently for a long for like decades that like if you don’t like where you live you can actually leave. Like, there’s an idea. I woke up one morning and I was like, my God, I’m not actually chained to this place. Like, I can leave if I want.
Mary: Did you have like a bam paradigm shift – boom! I’m leaving, we’re out of here?
Steve: Yeah, basically that’s kind of what happened.
Mary: It wasn’t like… Because my friends did that from Seattle. One day they walked out of a restaurant and the husband turned to the wife and said, we’re gone, we’re done, we’re out of here, we’re going back to San Diego.
Steve: It’s literally like one of those lightbulb moments, like I’m done!
Steve: And I’ve got to tell you. If I live Seattle, how is the suicide rate in Seattle not like through the roof, like Vancouver, Seattle, I don’t know. There are some people who like the grey and the rain and all that kind of stuff. I don’t understand it personally because I did Chicago…
Mary: Today’s weather’s bugging me.
Rich: We’re just inside working on businesses. Look at the businesses that come out here…
Steve: That’s true, right? It’s just Amazon and Microsoft and whatnot.
Mary: Boing, Boing, Boing… [Laughter]
Steve: Alright, speaking of…
Mary: This is the caliber of the show you’re at Mel and Kate.
Steve: Yeah, welcome, welcome.
Rich: That was Boeing.
Steve: Oh, is that what it is?
Rich: Airplane – manufacturer.
Steve: And Chicago pissed a lot of people off as far as Boeing goes. You can’t call me right now, I’m doing things… So, Boeing pissed a lot of people off when they moved from Seattle actually to Chicago. They moved their headquarters from Seattle to Chicago. No clue why they did that other than the time Daley was the mayor and I think he just kicked him like a lot of money. But – yeah, alright. So, given the choices if I had Seattle or Chicago as an option, I don’t think there’s any doubt at all that I would end up in Chicago. But Chicago versus southern California, that’s a no-brainer for me. So, welcome to Reinvention Radio. Glad you’re here.
Mel: Thank you.
Steve: And, so, we’re going to talk about business, we’re going to talk about entrepreneurship, we’re going to talk about making real money, and we’re going to talk about things you spray in your throat. Man, that is seriously cool. I didn’t even know… See, you’re a man of many many talents. I had no idea you were involved with so many different things and that’s what I want to get into as well is talk about all of the various things that you are up to, not the least of which you’re an author.
Mel: Yes, that’s right.
Steve: So, why don’t you tell people the name of the book that you’ve got out right now.
Mel: Absolutely. So, after being a serial entrepreneur and starting companies and buying companies and selling companies, I decided to put those types of experiences and events and stories into a book and the book is called, BIG BOOM: How To Ignite Your Life, Blow Up Your Barriers and Get Explosive Results in the Entrepreneurial Revolution.
Steve: Ooh – I love the Entrepreneurial Revolution, and…
Mary: We need to cover those seven mistakes…
Steve: We’re going to talk about seven mistakes, we’re going to talk about business…
Mary: …that we all made.
Steve: …we’re going to talk about entrepreneurialship, we’ll talk about making money, we’ll talk about the Big Boom and all the revolution that we’re going to do here with Mel Ethan Cutler, here on Reinvention Radio. More right after this.
Steve: Welcome back to another edition here on Reinvention Radio. I’m your host, Steve Olsher, along with Mary Goulet, Rich Otey, and we’ve got Kate and Mel in the house, what’s up ya’ all?
Kate: Whoo, hoo.
Steve: We’re in the house. And by the way thanks again to our sponsors Ruffles Sour Cream and Onion potato chips today.
Mary: Mary Goulet.
Steve: Mary Goulet, exactly. I didn’t know this, but did you know that one serving – guess how many chips is one serving.
Rich: I don’t want to hear.
Steve: 11 chips – 160 calories in 11 chips.
Steve: So every chip that you eat is basically like 15 calories. That’s scary.
Mary: Of good hydrogenated fat…
Rich: Obviously you only have to do one marathon per bag.
Steve: Only one marathon per bag. So, there you go. So, Mel, talk about – so, you’ve got the The BIG BOOM, so we’re talking about the Entrepreneur Revolution… First of all, what is the Entrepreneur Revolution in your way of thinking?
Mel: The Entrepreneur Revolution is not the type of revolutions that we’ve had in the past where – the negative ones.
Mel: It’s a positive revolution.
Steve: Although technically the revolutions may not have been negative, right? Because revolutions typically lead to something? They’re painful at the time but then they lead to better things, right?
Steve: It’s like the Mary Goulet revolution, like the better… It’s the better Mary Goulet now because you had a revolution and now the new form of you – because you had to revolt…
Mary: [Laugh] You’ve got nothing there, Steve.
Steve: I got nothing, okay, go!
Mel: Back to the Entrepreneur Revolution – it’s a revolution from the inside out. So, what it really is is helping people tap into their value and realizing that they can solve a problem in the marketplace, bring it to – bring that solution to people who will spend money with them…
Mel: …and developing a business around your purpose and your passion and how do you create a business that you can build up to sell and exit. Because so many entrepreneurs – when I coach entrepreneurs, the #1 thing that I tell them is that what I’ve seen is certain patterns, and that’s all everything is in life is just certain patterns, and you’re either going to deny those patterns and say no that’s not true, or you’re going to be aware of them and you’re going to break through some changes. Is that entrepreneurs is the #1 place they invest all their moneys is back into their business.
Mel: So, how do you actually ever realize that ROI? It’s when you sell it. But no one is going to buy your business unless it is sellable.
Steve: And profitable, and you’ve got… So, if you’re always investing back into the business or you’re taking money out in salary… But I guess you can do something like the EBITA. I mean you could do it before all of those types of expenses and that’s one way to value the business. But when you coach your clients on creating a business that is salable, what are the most important metrics that you teach them or at least you say – hey, think about these things?
Mel: Totally. There’s three major – there’s eight total, but there are three major ones that I’ll share right now because I know we have a limited amount of time and that is: 1) you must have monopoly control. You must have some sort of monopoly control in the marketplace. What that means is, how is your product different and do people care? Let’s take a look at an example, Tesla. Tesla, if you look at their marketing, the #1 thing that they push that makes them different than everybody else in the marketplace is zero emissions, zero – anyone know what it is?
Steve: Ehhhh. I know that they talk about their…
Mel: Compromise. So, zero emissions, zero compromise. No other car can say that.
Steve: See how many of us own Teslas.
Mary: Yeah, we all have a Tesla.
Mel: Soon, very soon. So, that’s the thing. If you go to their website right now that’s what’s on there. It’s not saying high performance, it’s not saying made in California, which are all – it might be different. Made in California’s different because what car’s made in California, but do people actually care about that?
Mel: Maybe not so much. So, the first thing is asking yourself if you’re selling a commodity, how the heck can you get out of there, how can you stop selling a commodity and how can you become different? So, a commodity is something that everyone’s got. It’s like gold, right? Why am I going to buy gold from you, a one ounce bar, for 1200 bucks as opposed to going over here and buying gold for more? Why am I going to pay $1500 for the same exact thing? I’m not. I’m not going to do it. So, for entrepreneurs, one of the deadliness mistakes that they make is they don’t differentiate themselves and they sell their service as a commodity, and therefore…
Steve: How do you do that, though? Because there are so many… Like, graphic designers, right? I know a number of people who are graphic designers, and some of them are like really good at what they do…
Mel: I’ll give you the secret. I’ll give you the secret.
Steve: Yeah, because ostensively these people are competing on price, right? I mean you’ve got some folks who are really good at what they do, but there’s a lot of people who are really good at creating designs and so on…
Rich: Isn’t the story behind it?
Steve: I don’t know. Let’s find out.
Mel: That’s an element. So, if you are selling right now based on price and you’re basing your service and you’re trying to beat prices, like what Walmart does, you will be out of business in no time.
Rich: Amazon and Walmart are going to crush you.
Mel: Exactly. They’ll crush you. You will not be able to sell your business and you’re wasting your time, in my humble opinion. That’s just my own thought. So, this is how you do it. I’ll give you an example right now.
Mel: So, a company that I’m a partner in and is a company that I’m coaching right now, they are a printing company. I’ll give you an example…
Steve: A perfect example of a commodity-oriented business, for sure.
Mel: Everyone does printing. You want to print a flyer, you want to print a business card – it’s a total commodity. So, we looked at that business model and said, look, if you want to sell it in five to seven years for a very nice multiple five times EBITA, five times the net revenue which is totally doable, then you have to have monopoly control. You need to be different and they need a care. So, how do you do that? Well, here’s the #1 key. If they’re just selling business cards, if they’re just selling flyers, if they’re just selling that, they’re just like everybody else. But what happens the moment you say, you know what? We’re going to bundle – the key word is bundle. We’re going to package these services. We’re going to say, we’re going to focus on a niche, let’s say for this example we’re focusing on the dental industry. And so when they go into a dental office it’s not where XYZ printing company, no we’re the dental printing company, we get you your smocks, we get you your business cards, we get you your forms, we get you everything in a bundle. So, when you bundle something, it helps you step out of a commodity into something much more unique.
Steve: Doesn’t that actually… I mean, just playing devil’s advocate here, but doesn’t that actually reduce your margins at the end of the day…
Mel: Why would it do that?
Mel: It would increase them I would think.
Steve: So, in other words, if you were just saying, okay, here’s Product X, let’s just call it a flyer, here’s Product Y, let’s call it a brochure, here’s a postcard, etc., you don’t think that people are saying to themselves, well, geez, the postcard should cost X and the flyer should cost Y, and the brochure should cost Z, and then all of a sudden it’s like – wait a minute! Why is it two X…
Mel: No, they’re not saying that.
Mel: Because your customer needs to based less as a transaction and more relational customer. They care more about convenience and quality than price, and if they care more about price and they’re doing what you just said, which some will…
Mel: …they’re not your customer.
Steve: Sure. And then how about going into a specific, like being that printer for the dental market or being the printer specifically for the auto market or something of that nature, is that a viable plan?
Mel: Can you imagine if – for now until the next five years, if we only did dental business and got thousands of people, dental offices, how – can you imagine the company that would love to have access to 3,000 dental offices?
Steve: Yeah, well there’s probably other ways then to monetize…
Mel: That’s right.
Steve: …that reach that move beyond just printing, right? Because…
Mel: That’s right. When somebody comes to buy you it’s either going to be a strategic buy, which that’s what we’re talking about or it’s just going to be a transactional buy. And what you want is a strategic buy because then you get five times, you get 10 time multiple.
Steve: So, going back to the graphic designer as an example perhaps then that graphic designer specializes in something like logos or specializes in…
Mel: That’s right.
Steve: …something like maybe brochures or something of that nature, or maybe they specialize in just like we’re talking about here with the dentistry, maybe they specialize in a particular industry…
Steve: …and serving that. Like, real estate, right? Like maybe the graphic design firm focuses simply on real estate agents and brokers and offices or something of that nature…
Steve: …because then wouldn’t a real estate conglomerate of some sort potentially have an interest in… Because it’s like, you move outside the traditional pool of buyers at that point because now it’s not just this design-oriented company, now it’s someone who has relationships. It’s like you’re saying, they’re actually buying into that industry.
Mel: That’s right. Now, here’s another huge tip – huge, huge tip, and I know we’re dropping some great wisdom here. Every product should also have a service behind it and every service-based business should have a product behind it.
Steve: Okay. So, let’s use this as an example and then we’re going to have to go to break here in just a few and we’ll revisit it when we have to go to break here, but you’ve got a product called Vocal EZE®. See, I didn’t even know you had this. So, you’re a diversified kind of guy.
Mel: And this is a company… I’ll never start up another company. This is just me. It’s kind of in the phase I’m in. Right now, I’ll only buy companies.
Steve: So this already existed…
Mel: This existed – this has been out on the market for 13 years, serving singers and speakers…
Mel: It’s well known. They have like all sorts of famous people using it.
Steve: Okay, so how did you determine the value of this company when you bought it?
Mel: Well, I looked at it and I realized that it was undervalued, marketing sucked, sales sucked, the people running the company their mindset wasn’t right, and so what that said to me is there’s plenty of room for growth.
Mel: Online wasn’t selling, and the owner only was focused on one sales channel. And, so, I said – look…
Steve: So, just one vertical there. There was a lot of other opportunities…
Mel: Totally. Because there’s a big difference between an entrepreneur, there’s a big difference between an entrepreneur and a business owner, and then a technician. And in Michael Gerber’s book The E-Myth, which if you haven’t read all of you guys should read it, he talks about the technician and the person who is like the scientist or the person who is actually doing the thing. That’s not entrepreneurship. Just because – as a matter of fact, just because you’re good at something that’s actually a reason not to start up the business…
Mel: …because then you’re going to be in it and not on it.
Steve: Yeah. Very cool. So, we’re going to have to do this, which is take another break here on Reinvention Radio. By the way, we’re actually going to have Michael Gerber on the show, so that will be kind of fun, kind of exciting, and hopefully he’ll join us here in studio. More with Mel Cutler here on Reinvention Radio right after this.
Steve: Alrighty, welcome back here to Reinvention Radio here. Let’s ask the most important question. I’ve kind of been thinking about this now for – when I found out you were coming in studio, I was like, cool! Mel is coming in the studio, this is going to be a lot of fun. And I knew that the first question that I had to ask you which took me to the third segment to remember to ask you – how does it feel to have no hair, man?
Mel: Oh, yes, the hair. What do you think about that, Kate? What do you think?
Mary: What are you talking about?
Mel: Oh, yeah.
Steve: Mel had some hair. He was a hair dude.
Mel: Obnoxious hair, like down to here.
Steve: How long did it take you… Like, you grew it out for a long time…
Mel: Yeah, maybe two years.
Steve: …and then how long did you have it long?
Mel: Yeah, for…
Steve: Maybe five years? Okay.
Mel: Yeah, yeah, it was long.
Steve: Okay. So, two years to grow it, five years to have it, and then 30 seconds to cut it.
Mel: I had it long on the island. Actually, Kate and I met when we were on an island just north of Honduras…
Mel: That’s actually how we met.
Steve: Nice. How much was she?
Mary: Ooooh. That’s not nice.
Steve: Jokes, just jokes.
Mel: Priceless. Bring out the gloves.
Mary: Whenever two or more boys are gathered they turn into 12-year-olds.
Steve: That is true.
Mel: That is true.
Steve: Alright. So, you met on an island and your hair was long, and loved the long flowing locks and she’s like ooh I like that guy.
Mel: Yeah. And so kept it long and then one day I just realized that I’m super attached to my hair, like…
Steve: Ooh. What’s that guy? Samson, right? It’s like a Samson thing, your strength and confidence came from your hair.
Mel: Yeah. I walked into the guy who cuts my hair…
Steve: Why did you even have a barber because you had long hair? Do you even need a barber when you have long hair?
Mel: Oh, yeah, you need like a…
Mary: Trim, right?
Mel: A highly trained barber.
Steve: Really? See. These are the things I do not know about.
Mel: And then he’s like, why don’t we go for something different? And I’m like – no! I can’t cut these.
Steve: I am not looking for the hair revolution right now at all, so… Yeah, the BIG BOOM, Entrepreneur Revolution, No-Hair Revolution at that point. So, obviously, he won at that point and how did he win? Did he buy you a drink at least?
Mel: It was just like a self0reflection where I’m like wow why don’t I want to cut it? And that’s actually one of the biggest, deadliest sins – actually it’s the first one we can talk about and it’s negative emotions. I realize I had fear of changing, I had the image in my head, like this was my identity…
Mel: …and when you have that, you’re less flexible, and when you’re less flexible, you don’t achieve what you want.
Steve: So, relating it back to entrepreneurship then let’s just say some business owners have their identity tied up in that business and they’re less likely to change when change is needed because they’re afraid of how their identity might be affected.
Mel: You got it! There’s two very powerful words, maybe the most powerful and that is I am. When somebody asks you.
Steve: Internet Marketing, yeah.
Mel: When somebody asks you… [Laugh]
Mary: I AM.
Steve: Oh, I AM, got it, sorry.
Mel: We’re going deep here, okay? It’s not deep. It’s I AM. So, when somebody says, oh what is it that you do? I am a doctor. What do you do? I am a lawyer. And when somebody says that what they’re actually doing is they’re identifying with that…
Mel: …which that’s not who they actually are. But the moment you do that then you put on the blinders. You’re like a race horse and you can only see one way until you get a coach, until you read a book, until you attend an event. And then those blinders can come off because you have to become detached. The best entrepreneur is they’re detached. They maybe have an idea, they put the right people in place, and they trust those people to go out there and do what they need to do.
Steve: Yeah. And, so, Rich, actually you had a question. We were talking about this over the break. What was your question for Mel?
Rich: Well, earlier when you were mentioning the importance of passion, doing what you love in entrepreneurship and I’ve just seen so many examples of people who did what they love and then next thing you know they didn’t like it anymore. Like, they love to cook and so they start a restaurant and they’re like – what the hell did I do? Now, I’m stuck in here.
Steve: All you’ve got to do is look at the number – like, the cupcake shops, like 50 million cupcake shops, it’s like – I love baking in the kitchen. Okay, you love baking in the kitchen, it doesn’t mean you should open up a shop.
Rich: That’s right.
Steve: So you might be passionate about baking at home but it doesn’t always translate to a viable business idea or entity.
Rich: That’s right. The balancing act between the two because I understand where you’re coming from but at the same time, back to the working on the business or in the business, if it’s just around your passion only it’s also probably hard to sell to someone else. That might not be their passion.
Mel: That’s right. And I’m not saying that it should be everybody’s goal to sell your business, but it definitely should be your goal to set up your business to sell. When I did a three-day event with Michael Gerber actually right here in Lo Jolla, and he said that if you have a business – if you love doing something and he’s a very contrary type of thinker – he said that you actually shouldn’t do that as your business. You should not do it because you’re going to get attached, you’re going to get too much in the business. And successful business owners, the ones who actually succeed where they build up a business when they hit whatever – 40, 50, 60 years old, they sell it and never have to work again, they realize that that company if it relies on them, if they have all the relational capital with every single one of their clients how is that going to transition? So, when you sell a company you want to think of – what they’re buying is not your past, they’re buying the future potential of the company and they want something that’s an annuity that has reoccurring revenue in it. That’s another key. Create reoccurring revenue in your business.
Steve: And so for a lot of folks who are in the coaching world, and there’s a lot of folks, it’s amazing… I don’t know. Does anyone even own a business anymore? Because it seems like all of the… That was weird, right? But it seems like all of the companies right now, at least in some of the circles I run in… That is so weird. But we’ll get to that. What I’m seeing out there is that there are just so many coaches that it’s like coaches coaching coaches on how to be coaches. There’s no recurring revenue in that. Like, every year you’ve got to be on the hustle. I mean, month and quarter and year and year out, you’ve got to be on the hustle of getting new clients. So, when you say recurring revenue, what do you mean?
Mel: What I mean is, for example, that’s a really good point. Somebody who’s a coach, right? If you’re listening and you’re a coach or really if you just have a service-based business what you need to figure out is how to take your service and productize it. Remember we were talking about turning a service into a product and a product into a service?
Mel: Well, this is it right here. You take your service – let’s say you’re a coach, you’re a business coach. Well, what you do is you can – sure, you can take on one-on-one clients but remember your most finite resource you’ll never get back is your time. So it doesn’t even matter how much you charge, it’s definitely not enough because how can you put a price on your time?
Mel: So, what you do – that’s fine, though. You’ve got to start somewhere. So, you take a client on and then what happens is you go into the recording studio, you go into the video studio and you record the genius in your brain. You create some modules, maybe a .pdf, a blueprint, some – whatever it might be, some transcripts… And what you do is you like, for example, I use a service called Kajabi, it’s my friend Travis’ company and Kajabi is an online membership site. We’re living in 2016, Steve…
Mel: …you guys know that right? So, everything… As a matter of fact, everything can be done on your iPhone. Everything. You literally can record what you need to record, upload it onto Kajabi, say hey I want to charge $29.00 a month, I want to charge $59, I want to charge $197 a month, and create some sort of residual income. The beautiful thing about residual income is it doesn’t actually matter how much. You just need to get into the habit of creating it and then you can grow it.
Steve: Yeah. So, if you’re interested in signing up for Kajabi, just go to SteveOlsher/Kajabi and we’ll get you hooked up right now.
Steve: That will be the plan on that.
Rich: It helps his Ferrari fund.
Steve: That would be my non-profit – the Steve Olsher Needs a New Ferrari Non-profit. If you want to donate to that that’s SteveOlsherNeedsaNewFerrari.com as well. So, you’ve got seven mistakes you were talking about – deadly mistakes that most entrepreneurs make.
Steve: And I feel we’ve been dancing around some of those but what have we covered and like how would you name those and of those… So, name the ones that we covered and then what haven’t we covered yet.
Mel: Sure. So what we’re talking about is blood in the water. If you – and by the way entrepreneurs, they make all of these mistakes, and, by the way, there’s way more than seven.
Mel: I’ve just outlined the seven most impactful ones that today after listening to this you could make a change. The first one is understanding and being aware of your negative emotions. There’s five of them. Fear, sadness, hurt, guilt and there’s a secret fifth one.
Steve: Yeah. I have all of those. So, I win, right? I win, yay, I have them all. That’s good.
Mel: We have them all.
Steve: Sadness, fear, guilt…
Steve: …shame, hurt, embarrassment…
Mary: And one more?
Steve: I could keep going. There’s probably a lot more than five.
Mel: Now, this is the thing…
Mel: …the keyword here is the unwarranted emotion. So, it’s okay to have them. We all do, we’re humans.
Mel: But when it’s not okay is when we’re sitting in front of somebody and we’re going to hire them and a bunch of fear comes up, or we have to fire somebody and we don’t, or we need to invest in some marketing but we don’t because of fear or guilt or sadness or hurt… All these negative emotions based on past events we’ve had we haven’t gotten rid of them out of our subconscious mind.
Steve: Okay. So, that’s one that we kind of danced around. And we’ve talked about a number of different things, so I just want you to make sure that we just name those and I want to make sure that we cover all seven before we get to the end here. So, what else have we covered and what’s left?
Mel: Got it. So, we’ve covered that. The second biggest mistake is being aware of your limiting beliefs. So, we all have limiting beliefs. Do we believe that we can create a million dollar company? Do you believe that…
Steve: Where do those beliefs come from? Like, why do some people believe that they can create a million dollar company when they have never done so before? I mean, there’s no justifiable reason why they should believe that they can do it if they have never done it before. So, why do some people have beliefs that limit them and then others have beliefs that really expand the opportunities that are available to them.
Mel: Totally. And the short answer to that long question is proximity.
Steve: Proximity to?
Mel: Proximity to the people around you. You will believe and you will take on the beliefs of the people that are closest to you. We all know that. The thing is what are you doing about it?
Steve: Yeah. Really, really good question. Okay, so let’s revisit that after the break here and I know we’ve got some others that we want to cover in the 7 daily mistakes and other things that entrepreneurs make here on Reinvention Radio. More after this.
Steve: Welcome back here to another episode of Reinvention Radio. Mel Cutler’s in the house. Welcome, welcome. Rich Otey, Mary Goulet, and White Wade made an appearance, so that’s a good thing. I always like when White Wade’s here. So, before the break we were talking about some of the mistakes, some of those deadly mistakes, but the other thing we were talking about just here on break was about being able to create a system and being able to name that system. A lot of people don’t take it to the point where they can actually say this was the secret to my success, this was the path that I took to my success, and yet if they were able to do that and then create that framework and name that framework they would probably have a pretty hot product on their hands, no?
Mel: Absolutely. If you’re able to step away… The goal is to be able to… For entrepreneurs we all have a bit of rebellion inside of us and sometimes we start up the business for freedom and success and when we do that sometimes those don’t mix – freedom and success…
Mel: …because you have to give up some freedom to really be successful. And so that’s where self-sabotage comes in and I’ve gone through that multiple times with many different companies. You’re just hearing about my successes really. I’ve had to move back into my parents’ house three times.
Mel: I’ve been in over $60,000 worth of debt that I had no clue how I was get out of – car repossessed, house taken from me… I mean, I had to hit rock bottom to figure out wow, okay… Like, I can’t go any lower, so from here on out if I can look up I can get up, like the great Les Brown says. Ooh hungry.
Steve: I like that. Most people fail in life not because they aim too high and miss but because they aim too low and hit.
Steve: That’s a Les Brown, thank you. That’s our sponsor Les Brown.
Mary: I like Les Brown.
Steve: That’s a good one. Alright. So, first and foremost let’s give people an opportunity if they want to get in touch with you where’s the best place for folks to go?
Mel: Well, I have a special thing that we’re doing, and if this message resonates with you at all then you should do it and that’s get my book.
Steve: Do it!
Mel: And you can get it 100% for free, you just have to cover shipping, $7.95. So, if you – if any part of this message was like wow that’s making total sense and you want more, go to BIGBOOMbook.com. That’s BIGB-O-O-Mbook.com. The book is free. Put in your information, just cover $7.59 and I’ll ship you a copy. You’ll love it.
Steve: Nice. Alright. Very cool. And for you personally is there a Mel Cutler site or anything like that that people should check out?
Mel: Yeah, really, just going to the BIBBOOMBook.com is the best place to go.
Steve: Alright. Very cool. So, we were talking about the seven daily mistakes and you were talking – there was another one that you wanted to cover there right before the break. So, let’s get back into that because I hate it when we run out of time but we’re going to run out of time here pretty quickly. So, what was the next one you wanted to cover?
Mel: So, we covered negative emotions, we covered limiting beliefs. The first step to change is being aware that you have those limiting beliefs and that may be the very weed in the garden that you need to pluck. Now, there are certain tools and books and processes you can go through to help you get rid of negative emotions and limiting beliefs like NLP. Neuro-linguistic Programming is a tool I’m personally a fan of because it’s really helped me and all the students that I coach. And once that happens those are the two biggest mindset. When we talk about mindset it’s negative emotions, limiting beliefs, and creating a compelling foreseeable future for yourself every single day. What you say to yourself and the pictures you hold in your head on a daily basis along with your physiology, your body, how you show up is what you become. And the tendency is that if you’re telling yourself crap, if you’re envisioning negative pictures, and you’re lying on the couch eating Cheetos all day it’s going to be very hard for you to be motivated and it’s going to be very easy for you to be in procrastination mode.
Steve: Yeah. So, just so I’m clear on this, so I should stop telling myself I’m a loser, I should stop picturing fire and brimstone as my future, and I should stop eating Cheetos on the couch.
Mary: Eating… Yes.
Mel: Imagine – you need a new sponsor…
Steve: And I need a new sponsor, right? I got to go for a fitness spa. Isagenix – here we go. We’re going to put that out into the universe. Isagenix will be our new sponsor. That will – that’s the plan there. So, that’s cool. So, the vision. What else do people got to be thinking about?
Mel: Then we move out of the inner workings and more on the external workings and with sales. So, an effective sales funnel, an effective sales system, somebody that’s doing the sales besides you and you always want to hire two salespeople at a time by the way, and why is that was your next question?
Steve: Really good question, of course it was. [Laugh]
Mel: Competition. You always want a healthy competition and you might be – well, I don’t have money to hire two salespeople. Well, the top best salespeople are going to love commission. Get them on commission, develop a system for them, and get them out there bringing you sales. So, a sales system – most companies they don’t do it. And then the person selling is the founder, is the owner. Well, what happens when you get sick? You want to know the #1 reason why people sell their business? Health. Something traumatic happens to them and they just can’t do it.
Steve: Then it becomes a fire sale at that point.
Mel: It’s a fire sale.
Steve: Yeah, and now we’re taking something someone’s offering and basically someone’s bringing it up on the sheet.
Mel: That’s right. So, are you going to plan or are you going to plan to fail, that’s the question. Because it takes an average of five to seven years to sell your company, so you have to make sure it’s done properly.
Steve: You’re saying form inception it takes five to seven years…
Steve: You’re saying from the time that you think about…
Steve: …I’d like to sell my company…
Mel: That’s right.
Steve: …it’s five to seven years until somebody actually writes you a check.
Mel: That’s right. That’s why you’ve got to get going now.
Steve: That’s a scary proposition.
Steve: I know. I’m like five years late. I should have started five years ago evidently.
Steve: Okay, cool. So, what else do you want to make sure we cover here on the seven deadly sins?
Mel: So, the next deadliest sin and this is #6 is not having effective marketing. So, one of the telltale signs that you will never sell your business is if you have one client that’s more than 50% of your total revenue.
Steve: So, I did $2 in gross last year so the $1 client, that’s not good.
Steve: I need at least three or four.
Mel: That’s right.
Steve: Okay. I’m going to up my game.
Mel: Because if this – and sometimes there’s businesses that have one customer, one client and you see this happen all the time…
Mel: …and that one client says you know what? We’re just not doing business with you anymore. That company goes under.
Steve: Yeah. My grandfather was in the manufacturing business and he actually made clothes for Sears and when Sears started closing stores that was his customer. When Sears started closing stores that pretty much threw him down the crapper.
Mel: Companies you’d never imagine. So, one our products, one of the companies that I own it’s called Vocal EZE® – it’s a vocal throat spray, all natural, for musicians and singers. Our biggest customer is Guitar Center.
Mel: Right? But my job as an entrepreneur is somebody savvy who says look, what if… You know, Sport Chalet just went out of business, right?
Steve: Yeah, they did. I heard that.
Mel: We’re talking about multiple stores across the country, what if Guitar Center went out? What would happen to Vocal EZE®? Well, since the last year when we acquired it we set up online funnels, you can go buy it online where before you couldn’t. We set up other customers that are as big as Guitar Center.
Steve: Yeah, smart.
Mel: So what it’s doing is instead of standing on one leg, now you’re standing on three legs, four legs, five legs…
Steve: Yeah. Super smart.
Mary: That seems really like common sense, but some people get so – they can’t see the forest for the trees.
Steve: They get blinded. Totally get blinded.
Mary: Yeah. Or overwhelmed.
Steve: And that too. It’s interesting too because – and I know we’re going to have to wrap here unfortunately but a product like Vocal EZE® which is a great product, by the way, I’ve tasted it, I’ve used it, it’s really, really good, so congrats on picking that up – it’s an awesome product. But I would think that the margins on that have got to be exceptional, right? Because it’s basically a liquid, right? So, you’re combining some liquids, proprietary formula… So, anyway, the bottom line being if you’re going to think about going into business you’ve got to at least take some of those things into consideration. I will not use your lip gloss but thank you for sharing Lip EZE, so this is a product line extension.
Mel: Extension. Right. So…
Steve: Very cool.
Mel: I do what I preach and I preach what I do.
Mel: So, we actually – when you go get the book at BIGBOOMBook.com we have such a high demand of this type of information for entrepreneurs to be able to really breakthrough in their business and to truly create a life where they’re creating enough income to cover everything plus, and it’s not taking all the time, we developed a workshop – a 3-day event.
Steve: What’s the name of that? We’ve got to give you a quick plug on that.
Mel: Sure. That event is called the Entrepreneur Revolution.
Steve: Entrepreneur Revolution. Very cool.
Mel: You could check it out at EntreRevolution.com. It’s an invite-only event. You have to apply for it and the best of the best show up. And that’s why I believe in proximity. I want the most serious, most powerful entrepreneurs in one room together.
Steve: Very cool. Alright, Mel Cutler, a lot of fun here, Mary Goulet, Rich Otey, White Wade – for the gang here, I’m Steve Olsher. Go to BIGBOOMBook.com. Pick it up. We’ll talk to you next time here on Reinvention Radio.
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