The past decade or two has seen an impressive surge in young people entering entrepreneurship. What began as a trend among millennials has continued as even Gen Z appears to have been bitten by the entrepreneurial bug. However, as many successful founders know, the challenge in reaching entrepreneurial success is less about founding a company and more about weathering the process of scaling it, especially building an 8-figure company.
The seven- and eight-figure marks tend to represent significant milestones in measuring a startup’s success. They also tend to reveal immense changes that are needed both for strategy and processes in order to sustain success and continue growing. That’s something that Charles Gaudet, CEO of Predictable Profits, has experienced first-hand.
Gaudet became an entrepreneur in his 20s before it was considered cool to do so. When he graduated from college with the goal of starting his first company, many of his professors were dismissive. Undaunted, Gaudet went on to build multiple successful companies. Now, more than two decades later, Predictable Profits is one of the largest coaching and consulting firms helping entrepreneurs break through the coveted seven- and eight-figure marks.
Prospective business founders under the age of 30 are likely to experience some unique pitfalls. Gaudet recently shared some advice he believes will be helpful in building an 8-figure company. Keep reading to see how he answers the questions below.
What unique opportunities are there for entrepreneurs under age 30?
I started my first business at age four, selling artwork to my neighbors. I built my first multimillion-dollar business 20 years later. Interestingly, people look at my accomplishments from the outside as “quick success.” The reality is considerably less flashy. Becoming successful required decades of struggle and failure.
At age 23, I was over $1 million in debt. Because I was so young, I figured I didn’t have anything to lose. Decisions were easier to make because I didn’t have to pay a mortgage, support a family, or stash away cash for retirement. In short, I didn’t have any large financial obligations.
Fewer financial commitments translate into greater flexibility, so it’s easier to take risks and rebound quickly.
What’s the biggest downside to being a young founder?
Simply put: the increased risk of not being taken seriously as a business professional.
For example, one time I was meeting with a client when someone else asked my age. When I responded that I was 24, the client whipped his head around and said, “I can’t believe I signed such a big contract with a kid!”
I often walked into meetings where people would instantly discount my expertise because of my age. It wasn’t until my success became more apparent that I overcame this challenge.
What matters more when reaching your first million, hustle or strategy?
There’s a reason why most companies start off selling something different than what they sell today. For example, 3M, originally known as “Minnesota Mining and Manufacturing,” sold a popular mineral to grinding wheel manufacturers. Microsoft started as a service company that uncovered bugs and fixed weaknesses in computer systems. Abercrombie & Fitch started as a sporting goods store and outfitter.
Even Predictable Profits started out as a marketing service provider before becoming a coaching and consulting company for seven- and eight-figure businesses. Most companies start with more hustle than strategy. As a startup founder, you think you know what your customer wants. You think you know what product or service will drive revenue. However, you don’t really know until you test the markets.
As you start developing your business, use hustle to test the waters and strategy when paying attention to what sticks. When you start seeing what works—and what doesn’t—use that data as the foundation for a scalable strategy that can get you to your first million.
Is there a particular sales component that many young, fast-growing companies underperform at?
Most entrepreneurs start with hustle but never make the switch to strategic thinking. In doing so, they rely too heavily on word-of-mouth and referrals, which typically causes unpredictable revenue and plateaued growth.
Our highest-performing business coaching clients start focusing on building a scalable outbound strategy for client acquisition (B2B) and JV partners (B2B and B2C).
It should be mentioned that it’s not “outbound” or “inbound” that builds a company with sustainable growth. You need both. Once you dial in outbound, move into the next stage of scalability where you can reinvest those resources into building a scalable inbound strategy.
What are the key things that a young entrepreneur must get right in sales and marketing to have a sustainable business?
The most important thing anyone needs is reliable data.
One of my mentors would often say, “There are reasons and there are results; the only thing that matters is the results.” To build a great business, you must make great decisions. To make those great decisions, you must eliminate as much guesswork as possible. You do that by making data-based business decisions.
Secondly, to have a sustainable business, it’s important to think beyond word-of-mouth and referrals and focus on a scalable business model. A scalable model is one that’s easy to expand once you have the data to demonstrate its effectiveness.
And thirdly, as I wrote about in The Predictable Profits Playbook, it’s important to have a diverse ecosystem of revenue generation strategies. A company dependent on just one or two strategies for generating leads and sales is vulnerable to changes. Just take a look at the companies that depended primarily on events as a lead generation tool in 2020. Some of those companies lost as much as 90% of their revenue.
Companies and clients with sustainable growth, month after month, seek to build at least one new revenue-generating strategy a quarter. Younger entrepreneurs need to keep this in mind.
Hopefully, you learned tips and strategies of building an 8-figure company or at least continuing to scale your successful business.