Living The Red Life - Product Diversity & Launching New “Stuff” - Blessing or Curse?

Episode Date: May 3, 2024

In todays episode we delve into the age-old notion that millionaires typically maintain multiple streams of income. How businesses, even giants like Amazon and Apple, continuously grapple with challenges and imperfections despite their monumental success, and why the dream of passive income might not be what you think it is. From start-up inception to scaling operations, and the significance of aligning entrepreneurial aspirations with individual capabilities and market dynamics. This episode will help you understand not just if you should diversify, but more importantly when you should and shouldn't.CHAPTERS3:01 - Understanding Entrepreneurial Roles and Goals4:07 - The Skill Set and Experience Threshold 5:08 - Navigating Business Growth: From Start-Up to Scale-Up5:26 - Industry and Market Dynamics5:56 - Personal Entrepreneurial Goals and Alignments 6:29 - Choosing Between Multiple Ventures 7:39 - The Importance of Testing and Adaptation 8:04 - Transitioning from Start-Up to Million-Dollar Business8:24 - Balancing Side Hustles and Scaling Ambitions 8:34 - The Power of Diversity in Business Growth 9:02 - Diversity: Adding Support Vehicles 10:52 - The Challenge of Innovation and Focus 13:36 - Apple's Strategy: Balancing Main and Side Ventures 15:36 - The Ever-Present Entrepreneurial Battle 17:02 - Conclusion: The Journey to 10 Million Connect with Rudy Mawer:LinkedInInstagramFacebookTwitter

That famous saying that most millionaires have seven streams of income. Well, let's dive into that famous saying and why you need diversity. But when is the right time to have diversity and when is the wrong time? Passive income, quote unquote, doesn't so much exist, right? You can have some things that are kind of passive, but most things in life when you're trying to grow them in business are going to take a lot of work. Look at Amazon.

It's made up of about 10 entities that make up most of its revenue. And it's kind of fascinating if you Google all the Amazon businesses that didn't work. So even Amazon being the best business potentially in the world, right? Apple, I would say is one of them too. They still battle with this, which is kind of clear proof to me that none of us are perfect as entrepreneurs. And we're always going to battle with this and face this and go through this. And that's actually part of the game game like you can't be the president if you don't get shot out a few times and people wanting to take you out my name is rudy moore host of living the red life podcast and i'm here to change the way you see your life in your earpiece every

single week if you're ready to start living the red life ditch the blue pill take the red pill join me in wonderland and change your life. Guys, what's up? Welcome back to another episode of Living the Red Life. Today, we're going to talk about the power of diversity in your brand, in your marketing, in growing your companies. So there's this big kind of debate out there that I always hear from people like, you know, should you have lots of products? Should you have one product to make a million? You know, is it true a millionaire has seven streams of income, blah, blah, blah, blah, blah. So I'm going to talk about all that, right? Let's start at the foundations of new products and new businesses. I think a lot of people out the gate when we're talking sub a

million dollars make the mistake of having lots of different businesses, side hustles and products, because I do believe it's true that you can make a million dollars from just a couple of products or one brand and I think it's very easy as an entrepreneur I know I did this in my 20s it sounds cool and sexy to have these four or five companies right but you know you know I had these you know a few side hustles and some real estate and some nightclub stuff and some fitness stuff and some supplement stuff. This is when I was like 21. And don't get me wrong, like they all help bring in income. I was making like a hundred grand or whatever in my early 20s, which is a crazy amount of money as a kid in the UK, right? In America, there's more

entrepreneurial kids and rich families and stuff, but in the UK, that was like crazy. But when I really like grew in my mid-20s to a million dollars, it was from one product. So there's this balance of like having a few products, a few hustles to figure out what you want. But then when you find what you kind of want and what's working, I think you should go all in and make your first million or next few million, right? And then it kind of like, then it kind of backflips on itself, where once you've made a couple of million or that product or system is working, then you want to add probably more products and services and SKUs within that same sort of brand.

And then I think eventually you now have to look at how to build a portfolio. Are you going to take this one brand and company to 100 million or 10 million or 50 million or 20 million? Or are you going to have a few companies? And this really depends on a couple of things. And it's a key couple of aspects that change the answer. So you have to listen carefully. The first question is, as an entrepreneur, are you actually good at growing companies to 10 million and beyond? 99.9% of entrepreneurs I meet probably won't ever grow a company past 10 million because they just don't have it in them. They don't have the mindset, they don't have the risk tolerance, they don't have the work ethic, and they don't have the brains or

experience to do that, right? But those entrepreneurs are very good at growing businesses to half a million, a million, two million, three million, four million. So it's very important to understand, firstly, as an entrepreneur, like, who are you, right? And it's okay if you don't have the skill set, experience, or risk tolerance, or work ethic to get to 10 million. You might just have one or maybe three different brands all making you a million dollars because you're really good at that startup phase. You're really good at that one to two million phase. You can't take it to 10 million. You've tried and tried and tried. So now you just have two or three companies doing a million or two. You have diversity. You have a balance in your life between different cool businesses you enjoy. If one industry crashes,

you have two other industries. Great. Okay. Now, the next question, right, is if once you figure out where you are as an entrepreneur and your experience and skill set and stuff is, do you have the business model and the industry and the addressable market size to go to 10, 20, 50 or 100 million. Because again, some of you might be experienced or good at growing to tens of millions, but you might be in a small niche where you make a few million and when you try and take it from 3 million to 30 million, the margins suck, the total business model changes, you have to go to hundreds of employees or like enterprise and you don't even know how to do that or you don't want to do that.

So that will also change the outcome, right? If you're in an industry that is much harder to grow to tens of millions but it's easy to have two or three million, you may stay at that one stream of income, right? Now some industries and businesses, they're actually well set up to go and make tens of millions of dollars. And if that's the case, then that's your main goal to build a big company and maybe exit, then you probably should stay fully aligned on that one thing, right? And it doesn't mean you can't, you know, say you're making a bunch of money and paying yourself a million a year. It doesn't mean you can't put some in real estate and do some stock trading or whatever on the weekends,

right? But 95% of your time, energy, and effort should all go into that one main business. So it's really important to understand, firstly, where do you align in that? What are your goals? What is your skill set and experience? Okay, I know so many entrepreneurs that, you know, they love the, I don don't know zero to 1 million or 2 million phase but once it gets to like 5 or 10 million that's where it's systems teams operations disciplinary KPIs come in and they're not very good at that so they don't do very well in that the business doesn't grow they can't make it they don't enjoy it if they do make it they they're in a business that they don't

enjoy so those people are way more suited to that startup phase and maybe doing multiple businesses. So they're the things you've got to consider when it comes to how many businesses do I have? How many income streams do I have? Where should I have diversity versus going all in? And as you can tell from that mix of that depends answer. It really is a personal decision and a decision kind of made by your skill set, your goals in life, the risk tolerance you have, and the business model that you have, okay? And when you consider all those things,

you should be able to answer for yourself, like how all in do I go on this versus diversity, right? Now let's talk about diversity as a startup, right? Getting to your first million. Like I said earlier, I think a lot of people make the mistake when they're like sub a million or half a million, where it's cool and sexy and sounds good to their friends and family and themselves. I'm like, I got all these hustles, right? But if your true goal is to be a millionaire, once you've had all these hustles and pick like, hey, this is the one, this is the thing, this has the total addressable market size, it has the great products,

I have the passion for it, it has the potential, then you should probably go more all in on that. But don't get me wrong, it will take some time to test and figure that out, right? You're not going to instantly just find that. And for some people too, that don't want to have big million dollar businesses or bigger million dollar businesses, I don't actually think a million is a big business, but you know, it's big when you're starting out. If that's you, you might enjoy having more like side hustles where you make a hundred, 150 grand a year, and you've just got like four or five side hustles, right? Like a kind of main business and a few different things where you make 20k a year. I know a bunch of people that do that

and they enjoy that and it's not like this big crazy multi-million dollar business with 30 staff. It's them and a couple of VAs and a couple of freelancers on Upwork and they're good, right? So again, you have to kind of pick where you want to be and that will help answer that diversity question. So now we've kind of gone through that want to be and that will help answer that diversity question so now we've kind of gone through that around business models and businesses and amount of businesses and ideas let's talk about the power of diversity as you grow your main company okay and this is kind of where I am in that 10 to 100 million phase and I do believe there's like some main products and business models that will give me a big you know a big

kind of growth factor within that but then i also have diversity in different products um kind of coming along the back right around the back of the main vehicle um i kind of see them like support vehicles right like if you imagine like you've got the presidential car right and the the president's in that main car and then maybe like the head of secret service in front of them. And then you have like the police around them, right? So I'm very focused on that, you know, main presidential car and the like secret service,

like black SUV behind and in front of it. That's my main three. But then you have the police escort coming around it, right? And they're like the newer ideas the side projects the maybe soon to be multi-million dollar channels within my organization a good example of that is tv right we started on a quest more around big socials and tv about a year and a half ago and so far we've shot two tv shows one one's featuring this July actually on a major streaming platform. I'm very close to being allowed to announce what that is

within a month or so and another one will be coming towards the end of the year and one more coming next year. So that's and that's not something that's making me millions of dollars and it's something that you know it's kind of coming you know behind slowly that can probably complement the main presidential vehicle and the Secret Service cars, right? But it's not the main driver right now. And I always have in the kind of cooker, I always have a few of these like things behind the scenes, things that are up and coming. And some of those things have turned into like two, $3 million companies or two products that have done a couple of million or celebrity partnerships that have done millions of dollars. Okay, so they're important.

And what a constant battle is for an innovator like me and an entrepreneur like me and a CEO like me that has such diversity is that kind of balance between how much time, energy, effort do we put on the presidential car and the secret service versus these other projects coming behind, right? And that is probably one of the biggest battles most entrepreneurs will face in their business career because we're really good at creating more police cars. But what happens is when we take our eye off the presidential car and the

secret service car, then we start to get in trouble. And then, you know, this start, you know, this presidential car starts getting shot at and beat up. And, you know, then you have to like step back in and fix that. And then you fix it for a little bit and then you go back to your police cars behind you. And then that starts getting in trouble again. So one of the yo-yo battles you'll always have, which can be eventually fixed by better team, right, and better systems, is that yo-yo between keeping the main vehicles running and then the innovation and the exciting stuff coming behind it, and that's something

that I don't necessarily have a great answer to. I always battle, right, that's like, I battle with the demons on that, constantly within my business of splitting that time, energy, effort, and focus and alignment with my team. And if you look at, you know, most successful companies that have reached tens or hundreds of millions of dollars, they generally have that main driver and most of their focus is there. And then once that's gone well and streamlined and systematized, they spend more time on these side things. So for you as a product owner or a brand owner or an entrepreneur,

firstly, you need to be super aware of that, super aware that there is a balancing act that's going to have to be had. And if you do too much on the back end with all the new exciting stuff coming behind you, i.e. the police cars, then the president will die. And when the president dies, well, that's a big problem, right? Because your main job is to keep the president alive. So just be aware of that. Now, with all that being said, adding more, one thing I haven't talked about is adding more cars to the Secret Service, right? So this is adding more cars to the main vehicle. And that actually helps the president, right? Because now you're building more Secret Service cars around him. And that to me is more products and services within the main vehicle versus things totally out of it, right? And to

give you a good example of that, we launch in all these TV shows. To me, that is stuff outside of the Secret Service and the president's main vehicle, which in my company is marketing, coaching courses, marketing education, right? When we launch a new celebrity brand, that's a new police car. It's not the main, you know, million dollars a month kind of goal with more capital, which is my coaching business and my education business. So one thing that's really important and probably safer is to build more products around your main thing, i.e. more secret service cars around the president, because that makes that main business and that main driver more successful. It makes it safer. And it's also one of the easiest, simplest ways to add more revenue. If you look at pretty much every company in the world, that's what they do. And I'll use Apple as a great example. So Apple, its main driver is Apple phones, right? iPhones,

MacBooks, iPads, that sort of stuff, AirPods, all that sort of stuff. So they are constantly, every single year, for a matter of fact, bringing out a new phone, new AirPods, new iPad and new Mac. Simple. They have a very clear formula, very clear financials and lots of evidence and proof to say every year they bring out all of those products, again, they make a bunch more money. It's very easy to run Apple, because it's like, hey, as long as I bring out new phones

and make them good and new software and new AirPods and iPads, I make more money. Very simple, right? Now, where Apple also battles with this demon, right, is Apple tried to launch a, I think, a car, right? They tried to build a car and I believe they cancelled it after spending something crazy like 200 billion dollars or something ridiculous, 200 million. You have to google it. So they were trying to build a new, you trying to bring in the police cars that could maybe one day rival the current president.

But it cost them a lot of time, energy, I mean, like many years and many millions of dollars, and it never took off. And Amazon's another great example of this. So if you look at Amazon, it's made up of about 10 entities that make up most of its revenue. And it's kind of fascinating if you Google all the Amazon businesses that didn't work I think there's over 200 um either

200 or like and there's 50 main ones that cost them like tens or hundreds of millions of dollars so even Amazon being the best business potentially in the world right Apple I would say is one of them too right they still battle with this thing, which is kind of clear proof to me that none of us are perfect as entrepreneurs. And we're always going to battle with this and face this and go through this. And that's actually part of the game, right?

It's like, you can't be the president if you don't get shot at a few times and people wanting to take you out, right? And you can't be a kind of titan like apple or amazon if you're not trying to bring and build new police cars behind you i.e new ventures because you will become extinct eventually right you have to bring in more support because if you just focus 100 on the main vehicle eventually that will die so it's again big balancing act very important to weigh up these things and and like you can tell there's no formula or right or wrong answer there's um

because it's going to vary for every single one of you there's going to be testing there's going to be tweaking there's going to be balancing between making sure the main vehicle's good and then you're innovating and and i've also gone the opposite way where I've not innovated enough in the main vehicle. And then it started to dial slow down. So then I've had to start increasing and go back to that and really focus on that. And after three months of doing that, I'll make millions of dollars and I'll go really save the day. Okay, good guys. We got money. We got more money coming in. We got more income streams now in that may we got more secret secret service cars around the president all right good i can go off and work back more on the police cars now and then i do that for six nine months and then it's like oh now i gotta go help the president again okay let me run over okay three months later okay you're good again

great okay now i'm going back to the police cars and that is the cycle that you will go through um probably on your quest to 10 million. And then, you know, I'll let you know that's on my quest to 100 million right now. And hopefully in three, four, five years, I can shoot this podcast again and tell you how that went. Right. And if it got any better or worse, I'm sure it will probably be the same, if not worse. But yeah, that is really understanding how, you know, the psychology and decision making and balance when launching new products, diversifying what you're currently selling versus innovating on new stuff and where to focus on between that zero to 100K mark, 100K to a million and then is going to be a balancing act. Know that it is going to take time, energy and effort. And it's going to be constant because you have to get the balance right between new innovation, new products, new revenue streams.

But keeping the main thing going and thriving because there's no autumn. You know, you hear all these things, passive income. And I used to hear this 10 years ago. And that was the goal. And then kind of realized you know passive income quote-unquote doesn't so much exist right you can have some things that are kind of passive but most things in life when you're trying to grow them in business are going to take a lot of work a lot of time energy and focus and and that is the game of business and it's why most people

won't do it and most entrepreneurs fail and it's why only very few people you know I always remind people five percent of businesses make it to a million dollars and if you imagine there's not many entrepreneurs only one in a hundred people are actual entrepreneurs and then less than one percent make it to 10 million so you know you are talking about like the elite of the elite when you get to that 10 million right so just know that's what it's going to take. And let me know how your balancing act goes between the main vehicle and the sub vehicles. Let me know on Instagram. I would love to hear how you're getting on. And I hope today was helpful for you to decide what's next for you, what products you're

going to launch, how much you're going to launch, how often you're going to launch it and how to balance that ever evolving kind of juggling act between new products and your current product. So that's a wrap today, guys. Keep living the red life. I'll see you guys soon.