The Ramsey Show - App - DAVE RANT: Passive Leader Is an Oxymoron! (Hour 1)

Episode Date: June 23, 2020

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Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studios, it's the Dave Ramsey Show, where debt is done, cash is king, and the paid-off home mortgage has taken the place of the BMW as the status symbol of choice. I'm Dave Ramsey, your host. Thank you for joining us. My co-host this hour, Daniel Tardy, the Executive Vice President of Entree Leadership, Operating Board Member. We've got an upcoming event in Orlando, the Entree Leadership Summit, coming up next month and a few tickets still available.

So we're going to take this hour and talk to small business people, talk to people in business, in leadership. If you've got questions about business, that's what our Entree Leadership team works with all the time, particularly small businesses. We love small businesses around here. You call in right now. We'll talk to you. The phone number is 888-825-5225.

That's 888-825-5225. Daniel, when we're in Orlando, we're going to have quite a lineup there. We can talk about that a little bit later, but one of the things we're going to do is we're going to talk about, with some of our operating board members in a panel, what we've gone through and how we have led through the coronavirus shutdown, how we led through our team working from home for a while, how we led through making the decision for them to be back in the office, how we led through dealing with COVID, how we led through revenue issues,

how we lead in a crisis where there is no vision. The people perish, perish, perish. Perish. Perish. Leaders who don't lead create serious death around them. Death of business, death of careers, death of revenue, literal death. I mean, leaders who don't lead aren't leaders. Passive leader is an oxymoron. Well, Dave, you know, everything rises and falls on leadership. Maxwell says that you can see that at the national level in our country, you see it in organizations, you see it in churches. Anytime there's a failure of an organization, it was always preceded by a failure in leadership. And one of the things that leaders have to do, if not, probably the main thing a leader has to do, we got to do a lot of stuff as leaders. But if,

if you had to pick one thing that you go, what do leaders have to bring to the equation? That's vision. it's actually tested in hard times like these. It's tested in times of chaos and disruption. So the difference between having a vision and leading with a vision is, you know, it takes 30 minutes on a whiteboard to have a vision. But leading with a vision takes guts, it takes grit, it takes courage, it takes getting your teeth kicked in. 100% of the time, there's going to be friction. There's almost no friction when everything's going right and it doesn't take a lot of gumption a lot of chutzpah to lead when everything's going

right when everything's turned upside down on its head these companies i'll tell you right now there are companies that are prospering and let me tell you why they're prospering prospering because they have leaders with the anatomical attributes to pull it off they're stepping up and they're leading now the other companies and we're dealing with both kinds out there you're saying they have a spine yeah we're dealing with both kinds of companies out there that they they're they're leading well or their leaders are complete pansies and they have stepped back and their legal department and their bean counters are making their decisions yeah that's right and when your legal department and your bean counters make the decisions in your company it's just a matter of

time before you die you're on your way out of business at that point and i would say those people aren't actually leading you can have a title you can have a title that says i'm a big shot but like you said if you don't have the spine and have the courage to make a hard decision I would say those people aren't actually leading. You can have a title. You can have a title that says I'm a big shot. But like you said, if you don't have the spine and have the courage to make a hard decision when it's not popular, when it's not socially acceptable. 100% of your decisions someone will disagree with. And so when you look at what does leadership really mean, it's going first on the hard things. It's easy to go first when it's popular. It's easy to say I'll be a leader when we're going to get ice cream. Let me buy. But when you're swimming

upstream culturally, you're swimming upstream, even inside your organization, not everybody's excited about where we're going and you have to shape the vision for your team. You've got to shape the vision for your vendors. You've got to shape the vision for your customers. And in this country right now, what we need is leadership and we need business owners and entrepreneurs to step up and say, we're bringing the economy back. We're doing it. We're going to figure out how. We're not being reckless about it, but we got to get back to work. This is our country. It's the time to fight for our country. And it takes leadership and the real leaders are stepping up right now. And the fake leaders are sticking their head in the sand and they won't be leading tomorrow.

Yeah. And let me tell you, real leaders lead while they're afraid, not in fear. They lead through the fear. Everyone has fear, especially when crap is coming against your company, your organization, when there's a medical catastrophe pandemic that we've got on our hands. There's fear. Fear is real. But you're going to do something anyway and not everyone's gonna want to do that and that's fine that makes you not one of the

followers well you can figure out i'm still gonna lead it that's right and you got to decide are you wanting to be effective or you want to be popular because most of the time you can't be both and dave you're talking about fear if i'm honest pretty much every day I get out of bed with some level of fear about something. But I don't stay in bed. I still have to lead. Somebody's got to step up. Somebody's got to make a decision. And somebody's got to drive forward.

And I think it's key that leaders connect with their teams and say, hey, I feel a little fear. It's okay, but we're still going to go. We're still going to do it. Let me tell you what this gives you. When you do, throw back your shoulders, stick out your chest, and lead, just freaking lead, when you will just do your job as a leader, what happens is that people can make a decision then if they want to be on that train or not. Okay?

I don't really care if you want to be. If you're not on my train i can deal with that what i don't want is people on my freaking train who are confused about the direction the train's going this is where we're going if you want to be a we get your butt in gear this is what we're doing if you want to stick your head up your assumptions and go do something else that's fine have at at it, baby. But we're going to be opening. And we're going to be having an event in Orlando called Entree Leadership Summit because we believe America is ready to open.

And we no longer believe the crap that has been spread and the fear that has been spread to the degree it has are there real concerns yes there are real concerns but the real concern right now is you have an unpredictable environment and people can't build a life on an unpredictable environment when civil when civility completely breaks down and anarchy takes over, when people cannot predict the direction that you're going because of lawlessness, when they cannot predict the direction that you're going because you're such a pansy, you won't say where you're going because you're afraid you're going to upset someone, then guess what? Guess what? They don't do anything. You have to have a predictable environment created by a leader setting a standard for business transactions to take place and for civilization to exist.

That's right. Well, and when you lead that way, you've got standards based on this vision. It was the American football player Ralph Martin. He said, don't lower your expectations to meet your performance. Raise your level of performance to meet the expectations. And you've got standards. Hold your vendors to the standards. Hold your team to meet your performance. Raise your level of performance to meet the expectations. And you've got standards. Hold your vendors to the standards. Hold your team to the standards.

Ultimately, that's what's best for the team. It is time to quit sucking our thumbs in this wussified culture. It is time for some of you that call yourselves leaders to get your butts in gear and start leading again. This is the Dave Ramsey Show. Business leaders now more than ever, we need people with the right skills to support our communities, especially the frontline workers who provide resources and care for those most in need. To help, LinkedIn is offering free job posts for healthcare and essential service organizations that need to quickly fill critical roles with the people who help us all. If you are hiring for one of these organizations, free job posts on LinkedIn can help you quickly find the

right people for your frontline. LinkedIn jobs can help by screening candidates for skills and experience you're looking for and putting your job post in front of qualified people who have what you're looking for. So you can find the right person to quickly fill critical roles to post a healthcare or essential service job for free. Or if you're in another industry and have hiring needs, visit linkedin.com slash Ramsey. Linkedin.com slash Ramsey. Terms and conditions apply.

It's an Entree Leadership Theme Hour here on the Dave Ramsey Show. Daniel Tardy, Executive Vice President and Operating Board Member of the Entree Leadership brand and all of our leadership brands, for that matter, joins me this hour to answer your small business questions. Seth's in Virginia. Hi, Seth. How are you? Dave, Daniel, how are you fellas doing today? Better than I deserve. What's up, man? Hey, not too much. Hey, I just want to let you know I'm going to be at your Entree Leadership Master Series event this fall.

Really looking forward to meeting you all in person. But in the meantime, I have a question about growing my small business. Cool. Looking forward to having you. Yeah. Yeah, man. So my wife and I own a brewery in Virginia, and we've been open about 20 months. It's been going really well, except for, of course, these past three months.

But we have an opportunity right now to grow our small business by adding a kitchen to have food to accompany the beer we have in our taproom. So kind of our situation, we're in a multi-tenant building. We occupy about two-thirds of the downstairs of this building, and the other third is a defunct restaurant. It's about as turnkey as you can get it. All the build-out's done. The equipment's in place. The equipment is bank-owned, so it's super-duper on sale right now. I see it as an opportunity for not only our business to grow, but to serve our customers better. That's awesome.

You got the money? Oh, yeah. Okay. Yeah. Yep, yep. Kind of on the flip side of it, though. So you can pick up the equipment for pennies on the dollar, and you can pick up the space and add it to your lease, right? Correct.

Yeah, yeah. We've already met with the landlord, already talked to the bank about it. Our biggest concern is, you know, you see and read about one of the killers of small business is rapid growth. And so we're concerned maybe this is too much too soon, seeing that we're only 20 months old. Just want to get y'all's opinion on that. Well, there's three things. I mean, you got to think about the business opportunity in the marketplace. And so I'd be interested in the retail traffic in that space. If you actually want to be in the restaurant business, it's not the same as a brewery. So you got to go, is this an opportunity we're excited about because it just showed up downstairs and now we're going to get away from our core mission or is this aligned with our core mission? Okay. So I want

y'all to be thinking about that stuff, but yeah, I mean, businesses do die because of rapid growth, but it's because they lose their culture and they don't continue to maintain standards with their team. So if you've got a healthy team, you know what your core values are and you can continue to staff up and make sure that the team is on board with the vision and direction of the organization. It sounds like a great opportunity, but there is a risk in this season that you go hire 30 new people and all of a sudden you've got all these people shaping your culture instead of you're shaping the way they graft into your court your culture and your core values so it's a it's a time that you want to be extremely intentional about the growth but we grow very quick around here and we've continued to maintain culture yeah two comments come to mind seth one is um

you know if your beer business was uh mainly wholesale and your whole outreach was you're going to brew it and get rid of it, and you really didn't have a retail vision, and the only reason you created this retail tasting room slash restaurant vision was because it popped up, it could be a distraction. But if this has been part of your overall strategy all along, and it's kind of like a hot knife through butter, then, hey, that's that's amazingly cool. The three things that we look for that caught that businesses screw up when they grow too fast is they outgrow their people.

And they strain their people and they take on more work than they can put out, and then they hire too fast and get a bunch of doofuses in the building. Okay, so grow slow enough that you grow with good people. The other thing that they can outstrip and outgrow is you can grow faster than your technology. And if you don't keep your technology infrastructure up with your growth, these days you're not going to win. You're going to implode. And then the third thing is, of course, you outrun your money, which means to do this, you go down to your last dollar. And if everything doesn't work perfect, then you're going to be having trouble with cash.

And 100% of the time, everything doesn't work perfect. So you're going to have problems with cash. Most of the time in this situation, business owners are given this beautiful opportunity and laid it off. But I'm going to have to borrow money to do this. And so I was expecting you to ask for permission to borrow money on this, which would be very common in your place. But if you're paying cash, that eliminates a lot of your risk. It may be bumpy. You're going to learn some things that you didn't know. You're going to make some assumptions going in about how well it's going to go, and it's not going to go exactly like that. But if

you're paying cash and you do the three areas that Dave just talked about, you're paying attention to those things. Lead it forward, man. It sounds man it sounds like and and it's not a distraction it's a part of your forward momentum you know and and so i mean if 80 of your business 98 of your business is is wholesale and you never really intended to create a tasting room or retail environment then you probably should not do this. It could be just a distraction. Well, and it's common that we, as entrepreneurs, we get excited about opportunities. Oh, we get excited about every idea. What I like about where Seth is at is it's inside the space that he's already in.

It's very common to get excited and say, I've talked to people all the time, they go, I got a beer business and I found out about a good opportunity for a retail clothing business. Those have nothing to do with each other. Why would you jump in the thing that you have the core competency in all the way over to something that's so far away from what we would call your native genius? And you're not doing that here. It's in the same space. It's food. It's beverage.

And it's in the same building. I really like the deal. Yeah, very cool. Good stuff. All right, Rob's with us in South Dakota. Hey, Rob, how are you? Wonderful. and yourself? Better than I deserve.

How can we help on this Entree Leadership Theme Hour? So I'm in a small donut shop, and before the donut, or I should say when Corona hit, you guys were always saying... I'm having trouble hearing you. Can you speak directly into your phone? Yeah, is that better? A little better, yeah. Okay.

So before Corona hit, you guys were saying, you know, or when Corona hit, just pile up cash, pile up cash. Well, we made it through Corona on cash. Good. And we're just wondering when should we return to debt reduction versus stacking cash? Well, is your business back to the high watermark that you were at? In other words, the revenue that you were bringing in, the level of sales, and then the bottom line,

are you back to where you were pre-corona? We're actually stronger than we were. Good. Okay. Well, I would continue to save a little bit of cash as a rainy day fund because guess what? We all just learned that it's going to freaking rain. And so if you don't have retained earnings and savings, it puts us in a desperate situation. So make sure you've got your war chest topped off. Make sure your sales are as strong or stronger than they were before. Sounds like they are. And then I think you start attacking the debt out of some of your profits now that you're in a stable spot. Yeah, we make decisions based on the facts at hand that give us an indicator of the future. So if your revenue facts at hand are that you're back up to where you were and business is running normally for you, and the facts at hand are that people around us in the culture are not all back up, but you are, then I'm fine with a normal retained earnings. You ought to always in business keep some retained earnings. We don't work the baby steps in small business the way we do in personal finance. We always say that, you know, set aside a portion of your profits for

retained earnings, and the lion's share of your profits should go to debt reduction. But it's not 100% to debt reduction. So you need to keep some retained earnings anyway, but go back to normal operations, which is what that's what we would call, that's what we would suggest to you as normal operations. Well, it sounds like it's safe to say that donuts are pretty essential business to the American consumer. Oh, man. You're probably always going to be in business as long as you're making donuts. Okay. I have talked to a bunch of small businesses in the past five days just on personal interaction and stuff I didn't even think about. The number one month for firearm sales in the united states was last month in the history of the united states is that bizarre i didn't even think about i was in academy this weekend

looking for some ammo and there's nothing it's gone it's all shelves are clear and same thing with fishing lures same thing with fishing equipment i talked to my boat guy that i that it does that keeps our boats maintained. I was talking to him on the phone, and he said, we've been open for 15 years. We sold more boats and higher revenue this month than we did the first year we were open. And it's the best month we've ever had in 15 years of having the business. Boats. Well, a lot of entertainment things are shut down, and people are doing in 15 years of having the business. Boats. Well, a lot of entertainment things are shut down, and people are doing it on their own at the lake.

And I've been fishing more than I have in a long time because everything else is closed. Well, the lake is apparently safe. I guess it is. As opposed to the neighborhood pool, because the HOA Nazis have closed all of those. Don't get me started on this one. Don't get me started on the hoas because i can just do an entire show hoas and time shares that would be that just get me going for the day right in the studio oh geez it's an entree leadership small business theme hour this is the dave ramsey show folks i love telling you about well-made well-thought-out products today i'm talking

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visit Grip6.com. That's Grip6.com. It's an Entree Leadership Theme Hour here on the Dave Ramsey Show. My co-host this hour, Daniel Tardy, Executive Vice President and Operating Board Member of the Entree Leadership and All Leadership brands here at Ramsey. We will be doing our Entree Leadership Summit in Orlando, July 13th through the 15th at the Gaylord Resort. This is an absolute blowout of an event. The Entree Leadership Summit is one of the top leadership events in the world today bar none our number our teachers over the three days will refill your tank because some of you have been running and gunning and you need your tank filled back up i have been i've been working like a 20 year old man i've been getting it what and a 20 year a 20-year-old work? Harder than I usually work. I've met some lazy 20-year-olds. I just want to make sure.

Well, I'm just saying, man. I've been working like I used to work. I mean, we've done like 460 media hits in just the past few weeks of me and the Ramsey personalities, mainly the Ramsey personalities. We've been going. And some of you have been going hard, and you've been facing a lot of stress. And leadership sometimes can be lonely, and it is a good thing to take a couple of days and get your tank filled back up.

From a business perspective, kind of like going to church, you know, gets you set back up for the week, right? And that's what this is. So Damon John from Shark Tank will be speaking. Mike Rowe from Dirty Jobs and Deadliest Catch will be speaking. Lou Holtz, the the coach will be with us benjamin zander the founder and conductor of the boston philharmonic ian crone will be with us best-selling author an enneagram teacher chris hogan of course ramsey personality will be speaking

christy right ken coleman ramsey personalities will be speaking i'll do a couple of different lessons while i'm there as well and we'll be there all week with you. This is an all-encompassing, all-consuming experience. You will go home completely reset on operating your business. It's pretty incredible, and there are still some tickets available. As you can imagine, we've had some people cancel and so forth. So if you're interested in being there at the Gaylord, it is a phenomenal property. They are excited about having us. They're excited about getting open back up.

We're excited about opening back up, and we're excited about helping you take this next step post-corona suppression. And so just text the phrase REGIS register now with no spaces to 44222 or just call our team here at 888-22-PIECE, 888-227-3223. Ask for the Entree Leadership Team, and they'll get you set up with a ticket. Also, for the first time ever, we're live streaming this. And we have never even talked about doing that. Oh, we've never done that before.

This is too exclusive an event. There's no excuse to not attend, either in person or live stream in your office with your team. And, Dave, here's the thing. We analyze business failure. We look at these stories of these businesses crashed, these businesses died over here. Statistically, a lot of small businesses don't make it. And the reason why is the leader fails. And anytime a leader fails, you can go upstream and you can usually look

six to 12 months before they stop doing something that's very critical to leading. And that is that they're growing themselves with three things, content, coaching, outside feedback and advice, and then staying connected to community. And inside this event, you're going to get content. You're going to get coaching and feedback. And like you said, we've been isolated. We've been a little bit lonely and Hey, I get it. My ego wants to be tough and go, I don't need help. I can do this on my own. But the reality is, and we know time and time again, that when leaders fail, it's because they got isolated. They got unplugged from the pack. And so we need to come together.

We need to rally. We need to connect to our community of fellow business owners and leaders. And we can lick our wounds a little bit together, but we're also going to figure out how we excel and how we move forward in the marketplace. And there's no better way than hearing ideas of things that other people are doing in your space, in the trenches with you at events like this. And we believe this is the best one out there. Yeah. So check it out. You can learn about the live stream of Entrez Leadership Summit, July 13 through 15. If you're in one of those situations where there's a no travel ban on your company or

something like that, that's a way you can still get this incredible three-day event. It is going to be lights out amazing. And just text the phrase register now with no spaces to 44222, and we will get you set up with that. Or, and you could consider just coming to Orlando and enjoying your time there. My wife and I are looking forward to being there together. She's going to be with me. The Entree Leadership Team, of the uh the entree leadership team of course several of our leadership team attend this because it is one of the best events on the planet

and so we always want our leaders to consume it as well our leaders will be that are not there will be consuming it um uh through the live stream here i'll tell you something cool the first time that i remember hearing a motivational speaker i was probably 12 years old and I was with my granddad and we drove to Dallas, Texas, about six hour drive. And we were in this big arena and I don't really remember what he said, but Zig Ziglar was on stage and he's doing his thing. And I was introduced at 12 years old to this idea, the power of intentional thinking of setting goals, all that kind of stuff. And so for the first time I've, I've been a part of this event for years, but my 11-year-old and 9-year-old are going to sit in the room and take notes.

And so we're going to get this stuff in their little brains while they're still hopefully malleable enough to plant those seeds. So it's going to be fun. They're going to talk about the time they heard Coach Lou Holtz, like you talk about Ziegler. Yeah. I mean, they're going to talk about that in 30 years. That's pretty cool because Coach Holtz, you don't want to miss it when he's speaking.

I mean, he brings a house. He's a blast, and you really come out of there thinking you can run through a wall. You do know how he did halftime speeches after you get to hear him talk. He is a rock star. So very exciting times, guys, very exciting times. So we are leading. The Gaylord Marriott organization says we're one of the first live events to come back online in America, and we're leading.

We're leading the way with that. We're not being crazy. We're not being reckless. We're not killing anybody. So shut up. But we're going to do the dadgum event. And we're going to have fun with it. Not only are we not killing people, but the Gaylord team is going, thank you. Because we've had to furlough. Thousands of team members are going to get to work that week. And they're going to get a paycheck. And they're going to be able to buy groceries for their families. And so there's a dignity in this. There's a trickle down

effect of when you lead in the marketplace, you're not just making yourself rich as the owner, you're providing jobs for your team, you're helping your customers and all the vendors you work with are providing jobs for their team. That's the way this economy works. That's the free market enterprise at work. And we have a responsibility not only to participate in it, but to lead the way. I can't heal you medically, but I can help your business. And I can give you business and that helps your business. And that's what we're doing. That's right. So we're about the business of business. And some of you don't agree with that. And you know what? I don't give a rip. I don't give a rip.

Don't come. It's a voluntary event. It's worse than voluntary. We're going to charge you to come. So don't come. It's all right. There's people sitting in here in the lobby watching this event, watching this show happen right now.

And we didn't make any of them come. They all walked in here and stayed, you know. And they decided they wanted to be, you know what that's called? Freaking freedom is what that's called. It's freedom. I get to do what the flip I want to do on a voluntary basis and I don't put anybody else at harm's way. Well, that's exactly what I'm going to be doing. There's always a risk every time you leave your house. You know, I mean, the statistics on the number of people that are killed in a car accident every day in this country are still higher than the people dying from coronavirus.

Yet we all get in our cars and we drive down the interstate. And that's an assumed calculated risk that's a part of living your life in this country. Well, I travel. I go all over. I go crazy during event seasons. I'm speaking and on airplanes. I'm doing all this stuff and you won't pick up some germs you can pick up some germs traveling you know you're a professional germ

picker that's man that's me my immune system is stacked i can tell you that and i go out at the breaks and shake people's hands and take pictures with folks and eight years ago backstage as i walk back in the door we put in a hand sanitizer. So when I walk out, because I don't need to be sick, I'm too stinking busy. I'm putting that on. And when I walk back in, because people come in here with a flu or something else, and I didn't want to catch it. So now it's cool, though. To have sanitizer.

Now it's dadgum fad. Maybe you set that trend. I was trying to not get sick. Let's do a study on that. Or not make anybody else sick. Go figure. So now my dadgum hand sanitizer makes me popular. Who knew?

And I put that in five years ago. I'm a trendsetter, baby. You got it, man. This is the Dave Ramsey Show. Let's talk about preventing the unexpected. Imagine your refrigerator goes out. You can fix your major appliances yourself with parts and expert advice from my friends at Appliance Parts Pros. They carry over 2 million appliance parts and offer easy returns.

And anyone can do the job themselves with 3,500 repair and how-to videos, plus live chat on their website. Save money and get your parts today at AppliancePartsPros.com. It's an Entree Leadership Theme Hour here on the Dave Ramsey Show. We're so glad you're with us. Daniel Tardy is my co-host this hour. We're taking questions and comments about small business. Open phones at 888-825-5225. Maurice is with us in Georgia.

Hey, Maurice, how are you? Hi, Dave. Daniel, how are you guys doing today? Better than I deserve. How can we help? Great. The question I have for you today is, Dave, you and Daniel, how did you actually start up a small business from the ground up?

Of course, I know you don't believe in credit cards or banks and getting along with anything. So how will you go about starting a small business up from the ground? Well, are you just talking about how to come up with the funding to start the business or how to figure out what type of business you want to start? Give me a little more about what your idea is. Basically both. You're hitting the bed on how do you start a small business using cash and also what type of business. Because here here I'm in the state of Georgia.

I'm listening to Dave, I guess you say rant somewhat. He rants. That's a thing he does. People are living in so much fear here in the state of Georgia. It is wild. You can't even go to a restaurant or go to a local grocery store, and they get six to seven, eight feet away from you. They won't even wait one minute. They're living in fear.

Well, let me say something about that. That part is going to pass. What you can focus on right now is what you can control. And so if you're thinking about starting a small business, the first thing you need to be really looking at is what are you excited about? What's a service you can provide that you're passionate about? Hopefully that connects to a story you have where you can solve a problem in the marketplace right now. And in terms of how you fund this business, we're going to tell you to bootstrap it. And what that means is you put on your boots and you get after it and you don't go to the bank and get a loan and you find out, can I make

something or provide a service and charge people for it? Starting with my friends and family, starting organically right where I'm at. And you can use all kinds of tools today, like social media to get the word out and let people know that you're, you're in business. My sister started a business a couple of years ago and she has a passion for cleaning houses. And she just started letting people know on Facebook, Hey, I'm thinking about cleaning houses. And she started knocking on doors and letting people know I'm cleaning houses. And today she's got several team members and she's busy all the time cleaning houses all over Franklin, Tennessee, where we live. But she didn't go to the bank and she didn't sit around and research a thousand different business opportunities.

She just said, I enjoy cleaning and there's an opportunity and there's a bunch of people that got some money and they would rather give up their money and have their time back and not be cleaning their house. And that's something I'd like to do. So I think you've got to go, you know, what do I want to do? Not just where's the opportunity at. And then you've got to figure out where you can serve the marketplace and get going with cash. And then at some point you look up and you're doing it and you're getting paid and you're a glorified employee as the business owner. And then you can hire somebody and you scale from there. But from the time that Dave started this company on a card table in his living room, it has not had a dime of debt. But that's the key. A card table in his living room is where

this thing started. And then today we're a multimillion-dollar organization, but we continue to invest the profits back into the business as we grew and scaled. That's exactly how it works. And so what that means is that you start small and humble, and that's okay. The stuff you put out, the thing you do might not be, you know, you may not be having your meetings over the top of a custom-made walnut table or something. You may be over a card table, a cheap folding table from Costco or something. You know, and that's okay.

That's a good place to start. That is where we literally started. And, you know, the first book that I did i i typeset the book i not only wrote it i typeset it and it looks like it too it looks like crap and the uh you know and the the grammar was horrible and all this stuff and i still sold 37 000 of them out the trunk of my car you know i didn't have a distribution system i didn't have a uh an s SBA loan that would tide me over until I could get my profits up. We just went and sold some books, and they gave us money for the book, and we took the money from that book and bought some more books, and we sold those books. And we did coaching and

counseling, and people paid us for that. We took that money and moved to the next thing. And that's what Daniel means by bootstrapping, is that we've made the business feed itself, and eventually it got where it could feed itself and us, and nowadays it feeds itself. Well, Dave, look, let's talk about this, because there's a notion out there that if I can go get the loan, I can fast-track my business. I can fast-forward and launch this thing more quickly and get to market quicker, and unfortunately, when we fast-track that, we're also bypassing so many of the learnings that actually build the foundation for us knowing what we need to do and what we don't need to do in the marketplace. The testing, the product market fit. Damon John was just talking about this the other day on an interview on YouTube.

And he said, you know, when he launched FUBU, he didn't want to hire a salesperson because he wanted to be on the street talking to customers. And they told him everything that he ever wanted to know about his product and his mom. You know, I mean, you get that real feedback from customers and then you go back and you say, this is, I'm going to commit to launching this product line because I heard from the marketplace. And when you borrow money and you hire a bunch of salespeople and product people, and you're not out there on the front lines, you miss all those learnings. And when you don't have those learnings in that firm foundation, it may get you fast-tracked into a little bit of quick cash, but then you've built the house on sand and it collapses later. Well, we've built this entire place on about 10% of our ideas. The other 90% of our ideas sucked. were a disaster, and we survived them.

We've had some doozies. Man, we survived those ideas. And if we had borrowed money, when you borrow money, you magnify the size of the mistake that you are inevitably making. Because you are making mistakes. You look confused and stumble forward, a guy said. You know, I just keep making mistakes you look confused and stumble forward a guy said you know i just keep making the mistakes i keep fate john maxwell wrote a book called failing forward you know we're experimenting we're scientists we're figuring out what doesn't work and you don't scale something that's an idea you scale something that's proven and has worked and

the marketplace you're having a conversation with the marketplace the marketplace is saying this is good this is good it'd be better if you did this okay now it's even better okay it'd be better if you did that it'd be better if you never did that again okay we won't do it and you continue to move back and forth and iterate and and polish and knock the rough edges off and and then you get the thing where it's doing a little bit of volume and then you scale that because what you don't scale from your prototype well and if you finance your mistake you don't get the opportunity to make them the next mistake the next learning it shuts you down so you'll go bankrupt because you'll be upside down and you know we put all of our money and we over borrowed and took an sba loan out on our house and everything else and and then the you know find out that our sub sandwiches suck and your little sub sandwich shop just bankrupt your family sub sandwiches sub standard apparently yeah whatever you said that's it that's

a good one yeah so that's the thing and you're going to make mistakes the entrepreneur has 73 ideas before breakfast and most of them are bad But when you have them on the running trail or in the shower or wherever it is, on the back porch with a cup of coffee, wherever it is you have that idea, at the moment you have that idea, it feels like the most brilliant thing on the planet. Well, because it's all in your head. And so it may not even be a bad idea. It may just be that nobody wants to buy it. Well, for it to be a good idea, people actually have to pay for it, okay?

So take your little feelings about your favorite idea people actually have to pay for it okay so take your little feelings about your favorite idea and put them over here for a second say if someone's not going to buy this and if a lot of someone's don't buy this thing then i don't have a business i've just got an idea and i'm excited about yeah that's exactly right you got a proof texted what our social guys tell us around here the digital marketing guys i learned that phrase the other day it's a cool phrase. You've got to put it in the market and make it prove itself. You've got to prove text the idea.

And so that is what we've done. And every time then when we get a hit, we just turn up the heat on the hit. Turn up the heat on the hit. And then we figure out what we did right there and then make the decision on how we're going to move from that point forward. So good stuff. If you're not signed up for Entree Leadership Summit, you can come live and in person to Orlando. We are open for business.

We will be there July the 13th to the 15th at the High End Gaylord Resort, along with Mike Rowe, Damon John, Lou Holtz, Benjamin Zander, Chris Hogan, Christy Wright, and Ken Coleman. If you want to watch it live stream also, you could do that instead. Text the phrase register now with no spaces to 44222. Daniel Tardy, thanks for hanging out this hour. Thanks for having me. This is the Dave Ramsey Show.

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