Hey, it’s Dave

In todays newsletter, I’m covering:

1. Weekly Sales Recap 🫰 

2. Where I’m effing up 😥 

3. How to build a better business

4. Cool findings on the interweb 🛻 

Week of 4/21 Sales Recap

Breakdown

Recurring: $1,830*

One-off: $280

New Customers: 2

*I onboarded a property management company that’s sending me about 3-4 move-out cleanings per month

Total for the week: $2,113

Where I’m effing up

I need to go faster in growing this business. I’m going too slow.

This is the first time in my life where I have no boss. No college curriculum. No teacher. It’s all up to me. There’s no deadlines. Nothing. This is what makes solo entrepreneurship extremely difficult. The whole day is a conversation with yourself on what to prioritize. You have no one to bounce ideas off of. You have no deadlines besides the ones that you give yourself. And that’s dangerous territory.

Enough of that sluggish, indecisive thinking.

How to build a better business

So what do I actually mean by go faster, and why is it important?

When you go faster, you open up your business to more failure. That’ll come in the form of exposing failing Standard Operating Procedures (SOP), incorrect pricing, and wrong hiring. Going fast exposes the weaknesses.

The learning curve steepens when your business is growing fast. You’re able to see where the business is working, and where it’s not, and it forces you fix the part of the business that’s not

Sure, you’ll make more money. But the real reason for going faster, is actually to break things. Here’s the process of building a better business.

Break → fail → Learn → Fix → Break →fail → Learn → Fix

The idea isn’t novel. But it needs context.

The faster you go through this cycle, the higher the chance you’re going to build a badass company because you’re iterating a lot faster.

And frankly, I’m not going through this cycle fast enough.

Again, the only way to initiate this cycle is by bringing in more business at a high rate.

Currently I’m doing $~2k per week. My next step is to get to $5k/week.

So here’s what I’m going doing:

1. Increasing my budget on Google Local Service Ads to $300/week

   1. The previous budget was set at $50/week and I was capping the max lead at $20- so I wasn’t getting very many - only about 1 or 2 leads per month. I’ve now changed the bidding to max out, but not to go over $300 per week in total leads.

2. Sending mailers to 4 zip codes in the county that have homes valued at over $1,000,000 and targeting new homeowners that have just bought a house within the last 6 months

3. Cold calling every property management office that’s part of the Ventura Chamber of Commerce (Cold calling sucks, but it works)

This is what would pop up if you search ‘home cleaning services Ventura’.

Overall, my new marketing spend is going to be around $2,500-3,000.

While I’m still trying to get over the fact that this sounds expensive. It’s actually not.

And here’s the math:

I currently have one customer that brings in $3,000 per month.

I can conservatively assume that she’ll be with me for two years.

That’s $3,000 per month, * 24 months = $72,000

This is what business nerds call Customer Life Time Value, or LTV.

At 40% Gross margins, that equates to ~$28,800 in Gross Profit.

If I can acquire even just one more of these high paying customers every two months, at a cost of $6,000, then I’m in the green. I’ll be paying $6,000 for a customer who made me $22,000 ($28,000 in Revenue - $6,000 in marketing).

This math doesn’t account for the fact that I’ll get a bunch of other smaller customers along the way.

A good assumption is I’ll have to get through ~100 leads to land a 2-5 new customers.

Out of every 2-5 new customers, maybe one will be a whale. 🐳 

Of course these are all assumptions. But that’s business. Making assumptions and taking action.

Cool findings on the interweb

1. Finally a car company leading with common sense. A truck that’s the same size as my 1991 Toyota Pickup, roll down windows, no heated seats, and knobs and dials— no fancy touch screen. Check out Slate, a new EV truck with practicality.

2. Wondering what a company that’s doing $1,000,000 / month is spending on marketing? Check it out below 👇️ 

This marketing budget is wild. I could never imagine spending $130k in one month. But for $1M in sales per MONTH…. not even in my wildest dreams.

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