Women and Entrepreneurial Poverty

Episode 220 • 23rd July 2024 • ADHD-ish • Diann Wingert

H: So Rachel, several years ago, I heard from our mutual friend, Tara Newman, a shocking statistic that 82% of female entrepreneurs are not breaking 6 figures gross in their business. In spite of all of the noise that we hear online about 6 weeks to 6 figures, 6 months to 6 figures, 7 figures, and so on. Clearly, there is a big disconnect between the hype and the reality so let's dig into this.

G: Absolutely. These are statistics that when I first heard them made my brain literally be that brain exploding emoji because I realized that only 12% are breaking 6 figures. Only 7% are making 250,000 or more, and only 3% are scaling past a million. And this is really sad when you consider that women are starting businesses faster than ever before. In fact, the fastest growing demographic of small businesses is black owned businesses owned by women, but they do not represent the revenue growth. We have 44% of small businesses run by women and they represent only 4% of total small business revenue.

Clearly I am a statistics nerd, but this is why I am on this mission to end entrepreneurial poverty for women entrepreneurs, because I know that most women entrepreneurs like myself started their business because they wanted more freedom and more flexibility. They wanted the opportunity to have that work life balance, to juggle raising a family or taking care of aging parents. And that's really hard in a traditional work environment where you're given maybe 2 weeks of paid vacation a year. The reality of life isn't compatible often for a lot of women in that professional environment, we need more flexibility. So for me, the biggest thing I'm out here trying to help more women entrepreneurs do is cross that multiple 6 figure mark on the way to 7 figures, because honestly, a $100,000 sounds like a great number, but I think everyone has felt the pinch of the last few years.

It's no longer what it was. It's not enough to really pay yourself a great salary by the time you consider taxes and any expenses that you have. Even 250,000 is kind of enough to pay yourself a decent salary and have a few people on your team to support you, but they're not full time. This is still a very, very small business, but at least you're not in it by yourself. But this is why so many women start businesses hoping for freedom of flexibility, and then they kinda burn out because there's this misconnection here about what it actually takes and what goals you should be setting in order to have that sustainability to create the freedom and flexibility you're looking for.

H: This is so so important and I'm finding one I mean, we have so many mutual frustrations about the industry that is producing female entrepreneurs who are not set up for success. They don't know what metrics are important. They don't know how to prioritize things. I mean, they're going and paying for very expensive websites and branding when they don't even know what their offer is or how to find or get paid by a first client. So I think a lot of women for me, in my observation and experience, a lot of women come to entrepreneurship really grossly under prepared and with really, inaccurate expectations through no fault of their own.

And if you add to that, the fact that many women may choose to enter entrepreneurship kind of willingly and voluntarily, many get pushed into it because they have a chronic illness and can't work full time because they've been laid off, because they are in an unstable industry, because they have a special needs child, because they have aging parents, because their spouse relocates for a job, they can't find one. Ageism, sexism, I don't need to go on. There's so many reasons why women who never would have chosen entrepreneurship, who don't actually identify with or see themselves as entrepreneurial are starting businesses because they have no other freaking choice.

G: Exactly. And I think this is where a lot of the hype out there I mean, it is hype. It's there's so much BS out there aimed at early stage business owners right now, and that's particularly frustrating to me because I feel like anyone who's brand new to small business, you know, 20 years ago, pre all the social media, pre, you know, blogs and YouTubes and all of that, I worked in the SBA and the SBTDC center. And if somebody wanted to come and start a small business, that was their main place to go was to their SBA, was to recognize places to get support. And we would tell them it's gonna take 3 to 5 years for most small businesses to break even. And now there's all this hype. That's the complete opposite. That's like, you can get to 6 figures in 6 minutes if you just follow my proven formula.

And then what really makes me honestly want to explode is that so many of the biggest names in the entrepreneurship and small business space, the ones that dominate on social, the ones that have the biggest podcasts or YouTube shows. For the more advanced entrepreneurs, they're watching them and realizing that now they're not even just targeting people who want to be entrepreneurs, who are just getting in the startup stages, trying to figure stuff out. They're now targeting people who wanna side hustle, who are still employed and giving the promises of all you need is a funnel. You're one funnel away right? Or you just need a course is going to give you so much freedom. And I'm here to share with most people that is not the reality. Most people that is not the reality at all.

And one of the best ways to get started and think about starting a business is to really get clear on what problem you are solving and figure out how you can solve that problem for people instead of building out some really, really complicated time consuming course or funnel or any of that. My clients who are have always been the most successful have been the ones that have taken their experience and expertise from their career and transitioned into running their own business. And that is a huge step up because they already know how to do the thing exceptionally well. They're not starting a business and saying, well, I've never done this before, but I heard this is how I can make money. And then trying to figure out marketing and sales and how to do the thing that you're saying you're gonna do halfway decently.

H: Yeah, that's actually ludicrous when you think about it. And it's like but yet so many of us fall for it. And I'll tell you, here's personal confession time, Racheal. I even though I was a highly educated, credentialed, experienced psychotherapist with a very successful cash pay private practice, when I decided to pivot into coaching, because I just wanted to help people in a different way. What I often say, I decided to shift the conversation. Conversations I was having from problems to possibilities and I'm much more directive than most therapists. So I realized, yeah, I'm really more of a coach and I was leaving the state and my license would expire the minute I crossed the state line for all those reasons.

But for some reason and this is so perverse to me, and I'd be curious what your thoughts are on it. I like many thought, well, I'm not gonna be a therapist anymore. I'm gonna be a coach. I'm gonna do this different thing. And while it's still helping people in a similar way, it's different. And I'm gonna go from working face to face to working online. It was as though my brain decided I am completely unqualified. I have no idea what I'm doing. I literally cannot find my ass with both hands and a rearview mirror. So I need to go find somebody to teach me how to be an online coach. That was a hideous mistake that cost me many thousands of dollars in a couple years of my life because I found myself in a coaching cult, and I realized many of them are very culty.

G: Oh, yeah.

H: And it really kinda separated me from the confidence I had in knowing how to do what I already had a private practice. It's not like I went from working in an agency or a hospital to starting my own business. I had already started and was already running a successful business. I wonder if you have any thoughts. Because I know you work with a lot of women as well. Like suddenly, like, wipe the screen like, I know nothing, I need to start from scratch, please tell me what to do.

G: No. I absolutely would have to say this is so common, especially with so many of the women that I work with. I when I shifted my brand into my, into Racheal Cook and have MBA at the, you know, in my signature now, suddenly I was seeing all these women who had so many advanced degrees show up in my world, and they all still struggle with the exact same thing. It's like we are needing that confirmation so much that it's okay for us to do what we're doing and that we have the credentials and we've done all the things. But here's the challenge like, you just hit on it so perfectly. When you got all of your advanced degrees in psychotherapy, you were that's highly, you know, overseen, credentialed, like, that is a really tough program. I doubt you just wrote a check, and then it didn't really matter how you showed up to that program. You got that certification and a degree right?

H: Yeah. Yeah. I know.

G: But the reality is a lot of the credentialing online, there is no oversight. There's no overseeing body. There's no code of ethics. For most of these programs, they're not actually checking that these people that now are using this trademark. They're essentially just licensing the trademark right? They're not actually credentialing people, it's just another revenue stream for them. They don't have a way that they're checking quality control. They don't have a way that they're checking that these people actually know what they're doing. But somebody who's coming from a clinical background, you had to go through so much right? And so I think it's really easy to feel like we have to go out there and get another credential.

But I'm really hesitant about that, and I just launched for the first time our own certification program. But I literally took everything that was frustrating me about these certifications online and was like, you know what? I'm gonna be super, super clear about what this is and what this isn't. I'm gonna make sure they understand the material, and I would feel comfortable with them going working with my clients now and that's not what's happening for most of these certification programs. You're spending usually multiple 5 figures, spending a lot of money, but there's no personal, you know, making sure that you actually are qualified to do this work.

H: It's unregulated, Racheal. There's no regulation even though I know ICF really tries hard to present themselves a regulatory body, they technically are not. And I think that, knowing that you can literally get away with doing whatever you want, you can be incompetent AF. And if you have a big enough name, there's gonna be no clap back because people are afraid of retaliation, harassment, and also the loyal fans of these big name people coming for you. I think that's one of the reasons why we see so much entrepreneurial poverty among women because this notion we go into entrepreneurship thinking that we don't know anything, not true.

We go into it thinking we need someone to tell us what to do and to lay out the path because most of us are risk averse. We don't have experience taking risks and failing and dusting off and trying again in the same way that men do. These are generalizations, but they've often proven to be true. We take it personally when we fail. We think it's a personal failing as opposed to a learning experience. Keep going. And we overinvest at the beginning when really you could get by relatively well with a lot of DIY stuff as you're figuring out what your offer is, what you have to sell, how to price it, who your ideal client is. If you are 20, 30, 50, a $100,000 in to investing in a business that doesn't even exist yet, it's gonna be so hard for you to reach breakeven. I wouldn't even say the 3 year mark is realistic at that point.

ch noise. Let's be honest, in: 2008

What problems are you having? I think I can help with these, would you like to work together? I could get enough clients to at least get the ball rolling, and I didn't need to overinvest in a lot. But that comes from having some experience and talking to people who had started businesses. And the vast majority of them said, just get out there and start talking to people and ask how you can help. Because they're gonna tell you how you can help, what they're struggling with. And if you can figure out a way to be like, okay. I can help you with that, you'll at least get the ball rolling.

H: But here's the rub, you have to get out. If you get out of your home you have to, like, put your face on, put some real pants on, and go talk to real people. And they will tell you, I have said many times the fastest, easiest sales I have ever made is when I'm out in public and I'm talking to people. I often find that men are more quick to make decisions as well. And I think this is because of all the intersections of being conditioned as a female to be perfect. Don't make mistakes, you know, do it right the first time. Think everything through, don't take risks.

I mean, that is such bad advice for being an entrepreneur and just getting out and talking to people and say, like, one of the best clients I've had to date is we were both in a spinning class at the gym I used to belong to in LA. And we were kind of, like, egging each other on and competing with each other I've never met before. Is it just dude sitting next to me on the bike and afterwards, we chatted a little bit about, like, I like your light vibe, I like your spirit. You really made this this ride better for me and I'm like, same. What do you do? And I said, I'm a coach for entrepreneurs. I think I need to, hire you and I'm like, could well be true.

And literally 5 minutes later, we're exchanging information and he became a client. And I'm like, what is so different about this than everything that's happening for female entrepreneurs now? And why it's so hard for them to make money and pay themselves and grow is that so many people are hiding behind their freaking computers because that, that right there has been sold to us as flexibility and freedom. No, baby. No, baby, that's a ball and chain.

G: Literally, I could not agree with this more. I think the promise of all you have to do is social media and create content and have your 47 step funnel and all this stuff, it is all promised as freedom. But then you get into it and you're like, oh my gosh, I am sitting here trying to come up with another social media post. I've got 8 more I've got to post today.

I've had the same exact thing happen. I am out living my life. I'm at the neighborhood pool with my family and another family comes up and we start talking, and I'm working with them. I've had this happen going to my chiropractor, who's become the longest term client I've had continually. She's worked with me for, like, 4 straight years now and it's because I'm just myself. And, you know, asking people what they do or what, you know, what's going on with them is such a normal human thing. But instead, we feel like we have to go online where we may not know anybody, it actually makes it harder.

I think one of the fastest ways to build a business is to pay attention to the people around you. You probably have at least a 100 people in your network, but if you start just making it a habit to talk to people kind of everywhere you go, you'll be amazed that who knows who and who can introduce you to who. It can take off really, really quickly, but you've gotta be willing to be human and show up and have real conversations and start building those real relationships.

H: And this is true whether you identify as an introvert or an extrovert. You gotta leave your house sometime. You gotta have a conversation with somebody. You do not have to overburden yourself with this idea of the elevator pitch and all this, like, people helping people is as old as, you know, the cave days. Like, we can't do everything on our own you know something that somebody needs to know. And if the person you're talking to doesn't need it, they know someone who does. I'm curious what your thoughts are about.

I understand we were we were locked up for a couple of years. And during that time, a lot of people, like, even hardcore extroverts like me became much more comfortable being alone. After the first few months when I realized, oh, I kept thinking, oh, this will be over in 6 weeks, then I thought it'll be over in 6 months and then I'm like, well, fuck me, this isn't going away anytime soon. I adjusted, I adapted. I'm highly resilient and highly adaptable, and I'm so grateful for that.

and I know you've heard this: 1000

G: Oh, lord.

H: They get another certification. They take another course. They go into another group like, I got news for you, none of that is going to build your confidence. What actually builds your confidence is getting in front of somebody and making them an offer and having them say yes and hitting the buy now button. That is what builds your confidence. No amount of certifications, no amount of courses, no amount of Facebook groups, hanging out with other people who don't know what they're doing. None of that's gonna move the needle. Why is it so hard for people to understand that and be willing to act on it?

G: Well, I think a huge part of this is a lot of us as we get, you know, older, I think we forget how to connect with people in just an authentic and real way. We lose that. In fact, my friend, Shannon Suriano, who owns Rebelle, had an event once that was how to make friends. It was the most packed workshop full of women in their thirties, forties, and fifties who were like, how do I make friends? I literally don't know. And so I think this is a part of it I think, also, this was part of the unlearning I had to do very early on. I'm very highly sensitive. I have a lot of neurodivergent situation happenings, I get sensory overload like, sound and lights, and I get very overwhelmed if there's, like, too much happening around me.

And I'm so introverted, and people are often surprised because once we get in a conversation, they're like, what do you mean you're introverted? I'm like, if I have to go to a conference where there's hundreds of people and there's the DJ going and there's commotion happening everywhere, and I can't even make my way through the room, I am gonna have to go lay on the hotel room floor in order to recover. But if I walk into a room of a bunch of women who I know probably a third of them because they're all part of this community that I'm also a part of and that is a comfort level. It's quieter, it's a little more intimate. I am happy. I am absolutely able to go and talk to every single person in that room. So I think the first thing is know your energy, but also know, like, what does the ideal situation look like for you for meeting people?

H: Yep.

G: Because if you're like me and going to packed events, going to things that are very loud or chaotic or where you're scheduled within, you know, every single 5 minute block. I hate events like that and so I do not go to them period. Like, I just realized I tried to do that for a very long time, and I would come home and it would take me 3 days to recover. I was just so overstimulated but when I have these smaller events, I feel totally comfortable. So part of my strategy has always been, I go to at least one event a month, and that's I literally I'm a systems girl, I can't help it. I'm like, my goal is to have one event a month and meet 2 people for coffee or lunch or something a month and that is my going out to the world.

H: In person.

G: In person and it has helped me so much because, one, it also gives me boundaries to make sure I'm not over scheduling myself, which can also happen, which can also burn people out because they feel like there's something every single week. But if you're like, you know what? I'm gonna focus on, I'm more introverted, smaller groups, smaller events, you can probably find something that's going on. If it's not local to you, there's still smaller events that you can go to virtually or just travel. I mean, I've definitely traveled to DC or to New York or to Atlanta all within a few hours of me either way in order to attend a more intimate event, because I knew it kind of fit the criteria where I know I can be myself the most. And I think that freedom is huge because it means I don't have to worry about those big things anymore. It just takes not even on the list anymore.

H: There's so much wisdom here, Racheal, and I wanna unpack it. So our listeners don't miss a single thing. We've been talking a little bit about how women overburden themselves when they're getting started by over investing in their business before their business really requires that of them. It may never require it of them, certainly, it must not make money and what it actually takes to have confidence. And the necessity of getting out and talking to people and not hiding behind your computer. What else do you think makes it more difficult for women to become profitable in their business when they're just getting started? And then I wanna move us along and talk about what makes it more difficult for them to be financially viable when they're a little bit more experienced.

G: The profitability side is pretty simple for me to explain because it's honestly not having your offers and your pricing sorted. Most women entrepreneurs who start price way too low. And they instead of creating a clear offer, they usually just start out selling, like, 1 hour of their time at a time. And that is actually setting you up for so much stress like, let's say you were going to become a coach of any type of coach, whatever type of coach you could imagine. But let's say you decide, oh, I'm gonna have a $100 an hour per session. Then you start selling those sessions, and you're having to refill your calendar every single week with new people. There's no continuity for those clients. It's so hard to get those clients to re sign up and recommit.

And at the end of the day, you're not served because you're constantly hustling to fill the next week's calendar. And honestly, they're not served because if your business is in any way, shape, or form about helping people make a change, go through a behavioral change, go through some sort of personal transformation, learn a process, that's never gonna happen in one session. That's like going to the gym with a personal trainer one time and then wondering why you're not doing like a bodybuilding competition. You've got to set yourself and your clients up for success by designing offerings that actually encourage people to go through the whole process with you and that help you lock in revenue you can count on more than an hour.

H: Yeah and I also think there's another aspect to that that's really, really important. And that is this notion of, like, hourly pricing versus value pricing. I mean, in truth, if you have if you're on your way to the airport to go close a very important deal and you get a flat tire, what would it be worth to you to have somebody appear immediately fix that tire and you get to the airport on time versus you're trying to figure out who can I pay the least amount of money to?

You have to wait. You miss your flight. You make a shitty impression. You don't close the deal. So I think the notion of value based pricing, it steers you away from thinking about what you do by the hour. Because different people take different amounts of time to get to their goals. And if you're being compensated by the hour and they don't realize how long it's gonna take, they're going to run out of money or at least the money they allocated to solve this problem before you get there so they are not served.

You are not served. You're definitely not gonna get repeat business. You will definitely not get a testimonial. You'll be lucky if you don't get a shitty Yelp review or, you know, some other form of negative clap back because you're not actually helping people. And yet so many people are encouraging the newbie entrepreneurs, the newbie female entrepreneurs to have these really low ticket offers to make it nonthreatening to people to take the first step toward you. If people really realized, and of course they don't really talk about this, but how big an audience you have to have to be able to make even a tiny bit of money on a low ticket offer, I think far fewer people would think this is a viable way to go about it.

G: Absolutely. This is literally why I created the get paid calculator that I created. It's absolutely free on my website. You all go to it, the ceocollective.com/hello. There's a little resources page for you. This free calculator is designed because I kept seeing this disconnect. First of all, with revenue goals, not being able to fund your actual take home income goals, big issue. Then making sure your revenue goals also consider, like, okay. By the time you put in taxes and paying yourself, what is your operation budget here? How much do you actually spend on operating the business? And then the final part of this calculator is the sales and audience calculator, where you can double check your offers, your pricing, how many clients are required in order to hit that revenue goal.

And then it'll automatically populate for you on the bottom. What audience size do you need? And the reason I included the audience size was exactly what you're talking about. It's because I think a lot of people feel like, well, if I just put out this low price point, it's less threatening. And over time, I can take somebody from the $27 thing to $97 to the overtime takes forever. And now you have really, really complicated your business. If you really want to get out the gate and have great revenue coming in the door, really uncomplicated business that takes very little overhead to run.

be a package that's at least $: 2500

H: I love everything that you're saying, Racheal, about simplify, uncomplicate. Simplify, uncomplicate. For the people in the back, I'm gonna say one more time, simplify and uncomplicate because what we're sold, as you said before, like the 47 step funnel, the proven process, You just need to do this, and then you do this, and you do this. What that's doing is keeping you dependent on the web celebs and the Internet gurus so that you keep paying literally. Because you need to keep learning things. I realize, you know, all the mistakes that I made when I shifted from a very successful private practice to an online business was overcomplicating and not trusting myself.

And I think if there's one thing I want everybody to hear, and I'm never gonna stop talking about, is that you know so much more than you're giving yourself credit for. And when you outsource your self esteem and competency to people that you don't even know, who are probably spending 1,000 of dollars a month on ads to keep getting in front of new people that they can dupe, you probably can figure this out in a very simple way. And for some reason and I am neurodivergent as well, as you know, and I have a tendency to overcomplicate things by nature because I keep adding another shiny thing and another shiny thing and another shiny thing.

And I'm like, oh, I wanna do this and I wanna do this and I wanna do this. And then it's like completely unmanageable, and I have to burn it down and start over. Like, why is it so hard for us to adopt this notion that simple is best. I think sometimes it comes down to just a lack of self trust and thinking if I don't feel confident, I'm not doing it right. No. If you don't feel confident, you're probably not really doing it. You're probably getting ready to do it. You're not getting out the gate yet. So, like, make it simple and get out there. I don't know how much more clear we can be. But that's just I think there's a lot of getting ready to get ready.

of what, the nineties, early: 2000

Meanwhile, Jeff Bezos is building out the infrastructure for something that became what it is right? And most of the businesses that we look at today that have and I think this is one reason why people overcomplicate, because they look around and they're looking at people who are so much further ahead, who are years ahead. And what they're not seeing is that the reason Gary Vee can pump out content the way he does is he literally has 40 something people on his personal brand team. That's not including anyone who works at VaynerMedia. Those are just the people responsible for his personal brand. And he's in a book launch right now, so I happen to hear him say, I have 44 people just doing that, and I'm sitting here going, you can't compare yourself to Gary Vee.

Like, that is a massive team just to make him look like he's everywhere right? And so we all have to remember that that most of the people you're looking at now who have been doing something for 10 or 15 or 20 years, they did not start out with a super complicated anything. They did one thing, and they rinse and repeat and rinse and repeat, and they did it again and again and again. Gary Vee did wine library for, like, what, 5 or 6 years before he really started writing books. And I think that's what we've all got to remember is you got to look backwards.

You got to be and I'm a nerd, I will research somebody. I will be like, where were they then? I will use the way back machine on my computer and go, what did their website look like when they started and it's hard to remember that. It's hard to remember that they started somewhere too, but the ones who've been here the longest, I always see that they picked one thing and they did it over and over and over and over again until it got to the point where it made sense to do another thing, to add another layer onto it. But they didn't start with all those layers, they started with one.

H: For sure, now what do you have to say to the people who are neurodivergent like us who get bored easily, because we know that's true, who are like, that simple pared down business is gonna bore the fuck out of me in no time flat. Like, what do you have to say about that?

G: So this is where I think you need to lean into your strengths and know yourself. A level of self awareness is gonna save your butt on this. Because if your business is designed in a way that you are always bored, yeah, you're gonna look for the shiny object. You're gonna come up with new things. I have gotten so clear on what my strengths are. I'm obsessed with the StrengthsFinder.

H: Me too.

G: And I absolutely love it. When I first found that, probably when it first came out, I mean, I've had the report for years and years and I keep going back to it. And I give it to my clients because I'm like, I know that when I can have conversations about ideas, I am in my happy place.

H: Same.

G: And that is one reason I set up my business the way it is because I wanted to have great conversations with amazing, interesting people like we are right now. And this is what I do in my business. Like my main role is to show up once a week for our group coaching calls or show up for my 1 on 1 calls and it is so much fun. My brain is literally so happy right now that I know that if I were to check my Oura ring, it's gonna tell me, like, I was in the zone. I was in recovery mode doing the things that we're doing right now.

And it's because I made sure that I know who I wanna talk to right? And I also made the decision in my business. I like the challenge of not having everybody doing the same thing. I actually love that my clients are across multiple industries. None of them are the same. We don't do cookie cutter. And it gives my brain that diversity that it needs to give it the opportunity to come up with solutions for multiple industries, multiple people, lots of different ideas. The frameworks are universal.

Because they're universal from pretty much any business. But I like being able to look at the person and their business and their clients and say, oh, I know how this would work for you, and it's gonna be different than it would work for this other person, this other person. So I think knowing yourself and making sure that you are getting what you need out of your offers, like, you should be excited to talk to your clients. You should be excited to have an interview. If you're not, then maybe we need to do something differently. But for me, that's what it was so to my brain loves the challenge.

H: Yes. Same, you have to know yourself, and you have to be willing to honor what you know about yourself because it doesn't matter what works for somebody else, it may not work for you. And even if it's working for you, but it's not working for you, like, you're making money, but you freaking hate it. You dread getting on your client calls. You dread making content. You dread it when you see you have a discovery call or a consultation because that might end up being one more person you have to deal with. It's like, it's time to take a serious, like, stop and reconsider your drinks and what you most enjoy doing.

G: Absolutely, like, if you're someone who absolutely wants to be behind the scenes, don't talk to anybody, then look at done for you services where you really have minimal contact with somebody. Because then you're just behind the scenes, doing the emails or creating the website or whatever it is. But if you need some personal engagement and you like having the I mean, it's so much fun for me. I can't even explain. If you like that then build that into it. I know some people who being mostly at home or by themselves, they really don't like.

And so they tried shifting into a different model, but then they went back and they're like, you know what? I just really love having clients come to my office, and that's what I prefer and I'm like, great. You need to know yourself and design your business accordingly. I think that's gonna help avoid a lot of the feelings of this is boring. It's just making sure it's all aligned. I think the final thing I'll add to this is I always give myself about 10% for experimenting. So there are core things in my business that are so locked in, so rinse and repeat. We don't mess with that.

Don't F with the system. The systems are working, keep running the systems. But if I get a little a little inkling, especially when I'm doing my research and I'm like, oh, this looks kind of cool, let me look into this. I'll look through it and decide, you know, I'm gonna take a little bit of time and experiment, and I'll make an experiment. I'll give myself parameters. So you asked me before we started recording about my TikTok journey.

This is exactly what I did with that. I took a couple months. I was, like, following, learning, seeing what how I might wanna do it, and then I gave myself parameters. Here's my 6 month experiment. Here's how I wanna do it for me. Here's what the testing is going to look like, and I didn't even care if I got results out of it. It was just like a creative thing, but it gave me a container for it, and it also didn't disrupt any of the core systems that were already working in my business. It was an add on so it was an experiment of just 10% of my bandwidth. It did not take away from the core things that I knew were working in my business.

H: I'm gonna make sure I highlight this when I promote this episode, Racheal, in addition to linking to all the calculators that you have for people. Because if you are worried about getting bored, and a lot of people say building is the exciting. The launching, the building, the growing, that's super exciting for an ADHD brain. I totally get it. But you have to build things into your business model that give you that extra stimulation on the regular without doing any damage to what you've already got. Because far too many people, when they get bored, they burn things down or they start to disrupt it in some way, just to get the dopamine. But I love the 10% allocation for experimentation because that's very stimulating. You can nerd out on, like, you're doing a research project, and the outcome does not matter. You're not attached to any particular outcome, so you can thoroughly enjoy it. No risk, love love.

G: Absolutely and it's enough for you to see if it works for you. It's like trying it on right? You're gonna try it on. You're gonna see it. If this fits you, and if it doesn't, then no big deal. But the biggest part about it is you didn't burn everything down. You didn't shut down what works. You keep those things going so that your business can be as stable as possible while you're running your experiment.

H: Love, love, love it. And I think so many of the conversations that are happening around us need to shift, especially now because there is so much female entrepreneurial poverty. And I think some people are starting to become aware of it outside of this conversation is that we need to stop investing as a source of stimulation. We need to stop trying new things as a source of stimulation. If it's not contributing to the bottom line, you gotta get your dopamine somewhere else because you will destroy your business in the process.

Now besides doing that, which I think is one of the reasons why I find so many and I was really shocked to realize, how much this happens. I bet you have a statistic is how many women I bet you do. How many women feel like they are succeeding in their business to some degree, but they are not paying themself? What are the number I mean, this is like this is where my head is. How does this happen? How many?

G: Yeah. Most I don't have a specific stat on this, but I will say most businesses in general are not profitable and this is another pet peeve of mine. The whole conversation just about revenue only and not about what you actually take home is very detrimental to women out there everywhere.

H: Literally.

G: Because it leads to this the belief that bigger is better. But I honestly know many business owners who are at multiple 7 figures, 8 figures, who are not paying themselves that much. At the end of the day, they're paying a ton to their team. But by the time they pay their team, by the time they pay all the affiliate commissions they owe everybody now, by the time they pay their massive ad spends, by the time they pay for all the software and everything, they are lucky to be paying themselves a decent salary. I think there's very, very few exceptions to that. And I think the only reason that would even make sense to me is if you were literally planning to sell this business soon, and even then you wanna show a higher profit because who wants to buy a business that's not super profitable?

But I do think for a lot of small business owners, like, if we use some basic back of the napkin math and it you only take home 50% of what you're making, which is what Mike Michalowicz says in his book Profit First, that a healthy business that's making 250,000 or less should be able to pay the owner 50%, but 82% are making less than a 100,000, so they're barely bringing home 50,000. We know most women entrepreneurs are really making less than 50,000. So basically, you could pay yourself more going to work at Starbucks, and they have benefits. So I'm like, where are we going here, everyone? Let's get real about this situation and start getting clear about how do we make it as profitable as possible.

Most profitable businesses are the simplest businesses. Most profitable businesses are boring businesses, meaning they rinse and repeat over and over and over again. And the most profitable businesses to in my experience are the ones that are very, very streamlined. They have minimal overhead. They have basically a small of a team as they can get away with having and getting the most out of that team. They're not adding extra expense just so that they can show off something and I think this is our culture in general.

H: Yes.

G: This is our culture in general too, though, because most people think that if you're wealthy or you're a millionaire, you're out here driving fancy cars. I'm here to tell you, no, they're not. They're driving off paid off Toyotas that they run into the ground. Every multimillionaire I have grown up around, they are not flashy, they are not fancy, they are focused on profit. And they are not focused on showing you how fancy they are by declaring their revenue or their toys. They're focused on actually building real wealth.

H: I'm so, so, so glad you said that. So we've been laying the groundwork for people to forgive themselves for not being profitable. Forgive themselves for not hitting the mythical, magical six figures for all the things. But if there are still in the game and want to stay in the game and looking for a job not wanting to call this a fail, I know you've got a solution and a series of strategies that people need to implement when they've reached the point where they're like, okay, you know what? I thought it was a great idea to build a business based on passion or purpose or both. I forgot the profit part, but I'm not ready to give up. I wanna put another p in the in the equation. Racheal, what do I do to start working towards getting out of entrepreneurial poverty and actually having a profitable, sustainable business for the future?

G: Yes. Well, I'm gonna share that I have a ton of resources on my website, including a series that is the path to predictable profits. And it includes it kicks off with a how to get started and get clients ASAP, which is a pretty intensive article I wrote breaking down some very simple steps you can take that will not cost you a penny. It's absolutely free on my website, and then that goes into what we call our business growth checklist, which includes all of the steps in the startup stage that you need to be thinking about as you're putting your business in place. That is where I start everybody because even businesses who are accidentally successful at the start, maybe they get a couple great clients out the gate because they happen to know the right person, already hit some great milestones, and they still go back through that checklist because they realize, oh, yeah, I need to make sure I have these things in place so I have a solid foundation to move from.

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