What if Most Businesses Grow Because they Invest Money, Regardless of What In?

Today’s thoughts are a little difficult to explain, but I’ll do my best.

The background to this is that I’ve determined I could probably turn money into new clients fairly reliably by purchasing other businesses. It’s a bit costly, but it works.

Most other businesses also grow and also invest money in opportunities, though they don’t typically acquire other businesses.

But my thought is basically this: what if they are only growing because they invested money at all, regardless of where they put it?

Obviously there are free forms of marketing, though they usually take time and therefor have a real opportunity cost, so in my opinion it’s the same in the end.

So if monetary investment of any kind is what leads to growth, acknowledging that fact has some very profound ramifications.

It would essentially mean that if you want to grow, you need to have extra cash on hand in order to invest in worthwhile activities. Without that budget, you’ll struggle to grow.

I think you could also simplify all forms of marketing and just say that all marketing you can invest in has an expected rate of return and acquisition cost for new clients, and while your goal is of course to maximize return and minimize costs, ultimately you’re going to have to spend money regardless.

Furthermore, given your limited resources, why not do everything you can to find the investment options with the highest ROI, and then invest everything into that?

Why bother diversifying at all?

I think so many businesses have so much on their plate with trying to run a bunch of social media pages and accounts, email marketing, SEO, trade shows, branded merchandise, various advertising, and much more.

But at the end of the day, all of those cost something and all of them have differing ROIs. Nothing should really matter other than the ROI, so why would you bother diversifying to that extent?

I think you should find what works best, and then put everything into it.

And now that you’ve found what works, and you’ve acknowledged that all you’re doing at this point is turning cash into growth for your business, the question becomes: how can I free up as much cash as possible so I can grow as fast as possible?

That is, assuming growth is your goal. But this is capitalism, so growth should basically always be the goal. Anyone who is putting any effort into marketing but doesn’t seem to think they want to grow (or more commonly: doesn’t actually have the capacity or ability to handle growth), is confused and should reconsider his priorities.

Historically, I’ve spent almost nothing on marketing; I’ve only put in my time. Which worked for a while, but obviously has a limit. I only have so much time, but money could grow forever.

I feel like I can see a future where I’ve figured out where to put my marketing dollars, where I’m putting everything I make back in and keep the ball rolling. It seems predictable and safe.

But as long as I accept this model as accurate and worthwhile, my mindset needs to shift completely. Whereas in the past my thoughts were always on marginally improving things and… I actually don’t really know what I was trying to do. I guess just grow “naturally”, whatever that means?

But whereas that, my goal now should literally just be to make as much money as possible now, take advantage of my credit, and invest as much as I can into growth. And as I take on more clients and have more recurring revenue, use that cash to grow even faster.

Unfortunately, I’m at a point at this exact moment where I don’t have much cash, and I’m not making a huge amount more than what I need to survive. I do have credit available, and I did just buy a business that will give me extra funds on a yearly basis.

But I’ll need to really think about where my dollars are going now, and how I can leverage them to trigger growth long-term.

As a follow-up side note: I don’t mean to imply that marketing initiatives that take up my time or can’t immediately be utilized or scaled up by spending more money aren’t worthwhile. There’s still room for a cohesive marketing strategy, and content marketing, SEO, and possibly social media advertising may still all end up being pieces of what I’m doing.

But they are all investments, and they need to be treated as such and possibly given money to be allowed to achieve their full potential.

I also don’t know exactly which options are going to have the best ROI for me. That’s part of what I’ll be working on over the coming months.

But if I can buy clients at the rate of $144 each, then that’s the metric to compare against. If I can find a way to acquire clients for less than that, it sounds like a good place to start dumping money.

And as a final side-note: for a typical client, I will likely make more profit than $144/year. So if my acquisition cost is less than that, it means that they’ll be profitable after a single year. And then after that, those profits could be used to acquire 1 new client.

Which means that technically, I should be able to double in size each year if I do things right.

Of course there are taxes and some other expenses that seem fixed will inevitably grow with the business, but even so, I should be able to grow very rapidly if I do this right.

I Need to Develop a More Robust Marketing Strategy

I’ve been reading a lot of books recently as part of my “One Thing” each day to help prepare me for all of my upcoming marketing plans. And I’ve concluded that there are quite a few things I’m going to need to do.

In addition to rethinking my positioning, rewriting my website content, putting together landing pages, and testing out different advertising options, I think I’m also going to need to plan out email marketing strategies and automation campaigns.

While I haven’t thought all of this through just yet, it’s become clear to me that I probably won’t be able to just put an ad on Facebook and have people purchase my services without any additional interactions.

Most likely, it will require me to turn them into subscribers of some kind first, and then eventually they will buy from me after enough interactions.

Unfortunately, it’s all just quite a bit more complicated and will take much more work than initially anticipated.

One interesting thing I read about is the difference between high-risk and low-risk sales. Unfortunately, I’ve found very little information regarding how to sell the two differently, which is very odd.

Low-risk sales are considered those of less than $200. My services could certainly fall under that category if billed monthly. So if nothing else, a good insight here is that monthly payment options should definitely be considered for new clients because the barrier to purchase is so much lower.

But even as a low-risk service, I think people perceive that going with us for any of our services is a very important business decision, and that they need to be cautious in their choices with it.

I’ve had a couple other interested thoughts recently that are unrelated.

The first is the fact that the clients we want to work with already have WordPress sites, and that we don’t need to sell them at all on WordPress itself. They already understand its value.

And with that in mind, I thought of a brief tagline of sorts that I thought sort of represented our value to those people.

“WordPress is hard. We make it easy.”

Perhaps a bit too simple, but maybe not! It’s not exactly praising WordPress itself, but to a business owner who is struggling with maintaining a WordPress site, they’ll get it. 

That’s all I have for now. I’ll be reading a few more books and then hopefully moving on to the rest of the tasks.