Growing is hard and takes a long time. Mastering these 5 ideas helped me speed it up.
1: We competed with ourselves.
One way to grow is to grind harder. A better way is to become a better company.
Every year.
An easy approach to that is to compete with yourself, not your “competitors.”
You don’t know much detail about your competitors, but you have all the dirt on your own business. You know exactly where to get your biggest advantages.
Compete with yourself. Leave old you in the dust. You’ll win every time.
2: We ran lots of experiments.
To be better, you need to try things. You need to run experiments, plow through small failures, and find big wins. Let’s call it R&D (Research and Development).
3: We fixed our profit margins.
R&D costs money.
Question: Where’s that money going to come from?
Answer: Thicker profit margins.
4: We maximized ARR (Annually Recurring Revenue).
Question: If you can’t raise your price or pinch any more pennies, How will you generate more profit?
Answer: Maximize ARR (Annually Recurring Revenue, i.e. recurring commissions).
Two reasons ARR is the holy grail:
- ARR shows up every year before you make your first sale.
- It has virtually no recurring cost.
That means insane gross margins that keep showing up. It’s magical. If you don’t maximize ARR, you can’t fully fund R&D.
5: We got way better at keeping our customers.
Question: What maximizes ARR?
Answer: Customers that give you all their business and never leave.
That means being consistent at customer engagement and giving them top value at every opportunity.
It’s impossible to overstate this:
As you engage customers consistently your business reforms itself around maximizing value to the customer.
Your vibe changes. Customer experience changes. Your heart changes.
Customers feel the difference. That customer feeling is what will get you out of the grind and make you a better company every year.