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The Universal Methodology Of Growing A Small Business With Michael E. Gerber

October 31, 2019 Patrick Donohoe 01:07:25 Comments Off

TWS 25 | Growing A Small Business

When people start a business, it’s often because of a dream or a vision. As people learn different processes, systems, and methodologies, dreams get bigger and growing their once small business becomes a necessity. Co-founder of Michael E. Gerber Companies and author of best-selling book The E-Myth, Michael E. Gerber opens our eyes to the reality of scaling a business. He shares his deep understanding of the entrepreneurial space to drop some old school knowledge that still holds true until today, where people are transitioning to the digital age. He discusses great philosophies and methods that can be applied by anyone, on any business, at any time.

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The Universal Methodology Of Growing A Small Business With Michael E. Gerber

This is an episode you are going to thoroughly enjoy. First, before I get to the guest, I’m curious about what you have been taking away from this season. I’d love to know if there’s been something that you’ve had as a struggle in business or in your career, in your profession that the content of the interview, whichever episode helped you to have a breakthrough habit, a realization, something that struck a chord that you’d like me to know about. This episode is the longest episode that I’ve ever done, but since this is the season on entrepreneurship, there’s nobody better than the godfather of the modern entrepreneur, Michael E. Gerber, to be my guest. Michael E. Gerber, for those of you who do not know, has written a number of books and has a goal of doing 300 and he’s 83 years old. He wrote The E-Myth and The E-myth Revisited and a number of other books. You are going to see that at 83 years old, the amount of energy this guy has is contagious and it’s just a living proof about age not necessarily being a restriction for being passionate and being purpose driven.

You’re going to learn that over the course of Michael’s career, because he started his career at the age I am now at 41, regardless of the amount of technology and the change in business, the change of environment, businesses starting, businesses going out of business. You’ve had dynasty business that are no longer in business. Regardless of how much the business and entrepreneurial landscape has changed, there are some universal truths and principles that haven’t. I believe that if you study cases long enough, if you’ve studied people long enough, you’re going to see patterns. There definitely are patterns when it comes to business success and business failure. I’m not saying that our modern times and the technology that exists and the different types of business isn’t important. However, there are some fundamental universal things to be aware of when it comes to the success associated with entrepreneurship. If you like what you learned, go onto iTunes and give us a good review. That would help. I hope you enjoy.

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Michael, thank you. I’m so excited for this interview. I’m so inspired by what you’ve done over the last many years and what you continue to do, whether it’s your books or seminars, you have this energy and drive within you to improve everyone’s life. Thank you so much for what you’ve done and what you continue to do.

I’m excited also to hear your story, but we’ll save that for another time.

Every company on the planet is a system called “this is how we do it here and this is why we do it that way.” Share on X

When I was preparing to do this, I did research on the word entrepreneur. There are a couple of different stories, but the French economist, Jean-Baptiste Say, who’s famous for Say’s Law, “Supply creates demand instead of demand creates supply.” He created that term, the entrepreneur. I believe that you popularized it. You set the stage for that word and how it’s been taken to the masses. What’s interesting is Say’s definition of the entrepreneur is the adventurer. I love that word because in your books, in your interviews, that is definitely you to a T, what you inspire in others. Looking at the last many years and what you’ve achieved, what were those emotional seeds, experiences that caused you to put your foot on the ground, draw a line in the sand and commit to bringing your message to the world?

It was very clear to me. I got into the business of dishes you might say accidentally. My brother-in-law owned a small advertising agency in Silicon Valley. That was a time way back then in the mid-‘70s when Silicon Valley was exploding with growth. A lot of what we call technicians, people who knew about the technology, high tech, were starting small businesses of their own like Apple, Google, you name it. My brother-in-law was having difficulty with some of his clients who were having difficulty converting the leads he created for them through his advertising into sales. He asked me one day if I would come with them to visit one of his clients. I said obviously because I wasn’t interested in business then. I was in my late 30s, early 40s. I said, “I don’t know anything about business.” He said, “You do. You know more than you think you do. Trust me and let’s go visit Bob,” the guy who he wanted me to meet, “See what happens.”

I said, “Fine.” That is my nature. I start stuff without any understanding of what’s going to happen because I trust that something will happen. It’s only a question of whether I’m open enough to see it and to appreciate it. Which I’m saying to every single person I ever have worked with or companies I have ever worked with, I call it a blank piece of paper and beginner’s mind. When I met Bob, it was obvious I didn’t know anything about business, but he didn’t either, and he owned one. It was astonishing to me that I did know something about business. I knew that selling is a system and I learned those years earlier when I sold encyclopedias door to door, knock on the door and there’s mom or there’s dad or whatever and so forth and it began. It began with this script. I was a complete novice. The guy who was telling the story about come work for us as an encyclopedia salesman, it was Americana, “Read this, memorize this and come back tomorrow.” He gave me about a fifteen-minute script. I had been practicing the saxophone with a great saxophone teacher and all I did was memorize scripts, which was a solo by Charlie Parker or solo by Stan Getz or whatever.

Part of my teaching in the music was to learn how to play that and have learned how to play that sounding like Charlie Parker, sounding like Stan Getz. It wasn’t just to memorize it. It was memorize it, internalize it, and then extend yourself to the style of the one who created it. In any case, I told Bob, “The reason you’re having a problem is you hired sales engineers. You thought they had to understand the technology, they had to understand the engineering, and they had to understand the product and sales because they had experienced selling. Neither is true. In fact, it’s your greatest single problem because you hired people you thought understood sales, but they didn’t. They understood the technology, they had experience selling, but they’d never been taught how to sell in a way that works. You needed a selling system.” Bob said, “What’s the selling system?” I said, “It’s exactly what I said. It’s a process. It’s a system. It’s a methodology. It’s the language. It’s the words. It’s the process by which any novice, anyone who passes the test can master the process by which you sell through them your product to the consumer you’re selling it to.” Bob said, “Do you know how to do that?” I said, “Sure.” He said, “Will you consult with me and teach me how to do that?” I said, “Sure.”

We negotiated a price and Ace then picked me up because he had dropped me off for this conversation. He said, “What happened?” I said, “He hired me. I’m now a sales consultant.” He said, “Michael, how can that be? You don’t know anything about his business.” He said to me what I had said to him before he introduced me to Bob. I said, “I do,” so that’s what I did. That was so effective with Bob that he asked me to meet with another one of his clients and then another one of his clients. It became obvious that none of them understood what I spoke about as an entrepreneur. They didn’t identify with entrepreneurship. They identified with the, “Technology,” of what they were selling and them as a technician, as I then called it, suffering from an entrepreneurial seizure.

The E Myth: Why Most Businesses Don’t Work and What to Do About It

In short, they went out to create a business out of it, out of what they knew. What they didn’t understand is what they didn’t know. That’s what I brought to them. What they didn’t know was far more important than what they did know. That gave birth to the E-Myth, the entrepreneurial myth, the entrepreneurial seizure to start your own business thinking that because you knew how to do the work, you knew how to create a business that worked. It was creating such pain and suffering in so many small businesses that I simply realized this is why I’m here. This is what I was meant to do. I never even imagined it before my experience with Bob and then my experiences with all the other folks that I then began to work with. I walked into McDonald’s and I went into McDonald’s to have a hamburger and fries on my way to my next client.

It blew my mind. Understand, I say it blew my mind. I never got my hamburger. I never got my fries. I was so stunned by what I saw for the very first time, what I was talking about and what was missing in every one of those small businesses. I saw a system. The business was a system. It was a visual system, an emotional system, a functional system and a financial system. I walked out of that McDonald’s with that picture in my mind. I can do that. In short, this is not about me doing it. This is about creating a system for doing it and I can create an enterprise out of them. That brought the whole thing to its natural conclusion at the very outset of what I call the Michael Thomas Corporation. I was Michael, Thomas was the guy who Ace was going to have replaced me because I decided I couldn’t stay there in Ace’s advertising agency. I had to create my own company to do what was absolutely critical, which now I call the Eightfold Path, which then I called E-Myth Mastery, and set out to do that. Tom was the guy who was supposed to replace me in Ace’s company who said, “Where are you going?” I said, “I’m going to do this on my own.” He said, “I want to go with you.” Tom went with me to create the Michael Thomas Corporation, a business development firm and the rest is history.

There’s something interesting about the experiences we as humans and we see opportunities to make a difference. It’s almost like this chemical reaction that happens inside of us that we want more of that. As I’ve read your books, as I’ve tried to understand entrepreneurship, it’s this idea of blinders and patterns and I think we all resort back to what’s familiar to us. Fear adventure, fear of the unknown. With your experience over multiple decades, even though in the business world, there are definitely some changes with what impact you make. Are the patterns different that people have when it comes to being an entrepreneur? Are they the same?

It’s a great question because nobody ever asks me that. If they did, they wouldn’t agree with the answer I’m about to give them. To them everything has changed. Meaning with the internet, everything changed, etc. With the brilliant creation of software, everything’s changed. The reality is nothing’s changed despite the fact that “everything has changed.” That’s why that first book, The E-Myth and then the book that followed, The E-Myth Revisited: Why Most Small Businesses Don’t Work and What to Do About It was published in 1992. The E-Myth, the founding book, was published in 1986.

I’m talking about ‘92. Think about that. What’s happened since 1992? Everything has changed. The truth is nothing has, and I say that because The E-Myth Revisited is one of the top five bestselling books on entrepreneurship and small business of all time. Every year since it was published in 1992, it sells more books than it did the previous year. It’s the only book on the planet that you can say that about. Why has it sold that many? We’ve never marketed the book. It’s all word of mouth. Essentially, somebody who’s read the book, you read the book, you say to somebody who hasn’t read the book, “You’ve got to read this book,” and you have done that. I’ve not met you before but I know you have. That’s true of just about everybody who reads the book.

Entrepreneurs create something you would never even imagine you could create and discover something that you would never imagine existed. Share on X

They speak to a friend, “You’ve got to read The E-Myth.” It goes on and on. They read the book or don’t. If they read the book and if they do the book, which is a significantly different thing they do the book, they can’t help but say to anybody and everybody who’s either got a lousy job and is thinking about creating their own business going out on their own, they can’t help but say, “Have you read The E-Myth? That’s what they call it. They don’t call it The E-Myth Revisited. They simply say, “Have you read The E-Myth?” Notwithstanding the fact that I’m sure you know I’ve written, published now over 30, “E-Myth,” books, each of them dealing more deeply with the subject, like awakening the entrepreneur within and the introduction of the dreaming room.

What you spoke about getting deeper into the process is what all of my books, our coaching, our mentoring has done over the years, albeit it is not about the changes that have occurred in business. It’s about going deeper into the original protocol, the dream, the vision, the purpose, the mission, the job, the practice, the business, the enterprise. However I speak about it, it’s absolutely essential as it was for Bob, that very first guy who I consulted with, coached about in “sales.” It became obvious to me that Bob didn’t understand what a system was and therefore I had to address everything Bob, not just what his salespeople did, but his lead generation, lead conversion, client fulfillment, financial system, management system, operating system, etc. Unless I’ve dealt with every single one of those components of the overriding system that exists in every company, no matter whether it was 1977 or now, The E-Myth lives at the heart of it.

I think we should go into a few of the things you said because what’s interesting is it’s even more important now than it was then. Now, there are more distractions, more noise. There are more options. There are more things that pull people as far as what would make a difference in their business. It could be, “I need to improve marketing. I need to improve sales conversion.” There are many different polls people have, but what I hear you saying is that the patterns of human beings haven’t changed much. Maybe could you walk through the ideas that you’ve been talking about the hierarchy of growth, starting with those initial stages and why a person’s understanding of not just themselves, but then as they bring on people themselves as it relates people? That would be compelling. It starts to show the importance of systems so that you have degrees of certainty as you grow.

Speaking about the totality of the system, Apple is a system. Google is a system. Facebook is a system. McDonald’s is a system. Every company on the planet is a system called this is how we do it here and this is why we do it that way. You’d be astonished how few small business founders, owners, operators understand what I said. You’d be astonished to see how few literally have a dream. When I said it, a dream, a vision, a purpose, a mission, you understand that is a sequence. Meaning I have to have a dream first. The dream is a great result I intend to produce by founding this small business. What is that great result? They have to know that great result. When I started the Michael Thomas Corporation with Tom, before we ever started the company, we sat with each other day after day asking the questions we needed to ask in order to come up with the answers we need to internalize so that we could communicate them clearly.

The first in that process was the dream. What’s our dream? What’s the end game we’re pursuing here? The dream was a great result we were to produce. We had to first understand the great result our company is being created to produce before we ever could then discuss what our vision was. Understand people typically just the thing that I’m using different words to say the same thing. I’m not. I’m defining something indifferent. The vision, once I understood what the great result was and the great result, the dream for the Michael Thomas Corporation way back then in 1977 that has persisted throughout these years since we founded that company. The dream was to transform the state of small businesses worldwide. In order to transform the state of small businesses worldwide, we had to transform the state of entrepreneurship worldwide. Once we accomplished that, we would have then transformed the state of economic development worldwide. That was obviously something that if we could do it, would have a more than a profound outcome than anything we could do in the Michael Thomas Corporation, the first business development firm of its kind. It’s the first business coaching company on the planet. Nobody had the dream that we had.

Growing A Small Business: The E-Myth is the absolute replicable turnkey system that can be applied to every single small company on the planet, no matter what it does.

I read it or heard you say it once. They talked about this like entrepreneurial seed bits that are in all human beings. I interviewed the Founder of Upwork before Upwork became the company. One of the claims that they have was in the Philippines and how it brought $250 million of increased GDP because of Upwork. That entrepreneurial seed sits in everyone wanting to improve their life, wanting to improve the life of other people. That’s profound. Essentially one of the things that you’re talking about, which is establishing that dream, which I believe everyone has.

We say that religiously over all these years. As it’s said, we’re born in the image of God. That’s what’s said. It’s said in every religion. It was said first in the Jewish religion. It is the truth that we speak to everyone we’re talking to. We’re essentially saying, if we’re born in the image of God, as it’s said in the Old Testament and the New Testament, as it’s been said for thousands of years, if we’re born in the image of God, then born to create. Every human being is born to create. None of us are taught how to create or how do identify what we’re here to create. We’ve never been taught that. Our parents weren’t taught that because our schools don’t teach us that, because they teach us exactly the opposite of that, we are not capable of truly understanding what that means or even worse doing it. What we’ve been doing is awakening the creator within, the entrepreneur within because that’s what an entrepreneur is. An entrepreneur is a creator. An entrepreneur isn’t functionary. There’s no organization chart that says, “This is the entrepreneurs.”

If you watch the movie Steve Jobs, Steve Jobs said to Wozniak, “Wozniak, you’re brilliant at what you do in the orchestra. I create the orchestra.” The difference is huge. It’s beyond description in one way and we set out to describe it. When we say awaken the entrepreneur within, we’re truly saying awaken the creator within and inspiring them, teaching them, training them, guiding them, coaching them, mentoring them to pursue their true reason for being here on earth. What we’re saying is in every single one of you can discover what that is if you follow the process we’ve created for you to discover what that is. Within my books, I describe, discuss, pursue and define the process that’s critical to awakening the entrepreneurial, what Walt Disney called Imagineer, within. To create something you never even imagined you could create, would create, to discover something you never even imagined existed was possible, was your calling. To be able to do that goes so far beyond the technical as to say the technical part isn’t important.

The imagination of creation is the most important part of the seeding of any and every company or anything on the planet. The first part of that is the dream. That’s awakening the dreamer within. The second part is the vision. Let’s awaken the thinker within because now that I’m going to create a company whose intent is to transform the state of economic development worldwide in a very specific manner, form, shape. I now have to understand what my vision is. Which means I have to be able to see them, how that will appear on the planet. We call that the second step, which is the vision, which ours was to invent the McDonald’s of small business consulting.

At the very beginning, in 1977, when we discovered what our dream was, we then created what our vision is, which is to transform the state of small business. It was to create the visual contextual model for how we’re going to do that. That was to see it by describing it as the McDonald’s of whatever the dream ultimately said it was going to do. The McDonald’s of personal growth and McDonald’s of whatever it was. The third was the purpose. Everybody thinks the purpose is the dream, but no, the purpose isn’t the dream. It’s the third part of the dream, which is to make it possible for every small business owner who came to us to be able to create a successful company doing what their dream called for them to do. It’s doing what their vision called for it to be and to be as successful as a McDonald’s franchisee or better in the operation of that company.

Until small business owners understand the dream, vision, purpose, and mission, they would never be able to successfully grow a company. Share on X

We would turn out these successful people up to the last point and the last point of the dream, vision, purpose, and mission was the mission and the mission was the system. The Michael Thomas Corporation, we invented the business development system that would enable us to realize our dream, our vision and our purpose. The system was how to create a business development process that could be applied in every company on the planet. When we got done with that work and began to communicate that to every single small business, we called on the door to door, straight commission salespeople in the Michael Thomas Corporation exactly as though they were selling encyclopedias. In exactly the manner I described, selling our dream, our vision, our purpose and our mission. Essentially telling every small business owner that until they understood the dream, the vision, the purpose and the mission, they would never ever be able to successfully grow a company of one, which is what every human being is when we’re born. An economy of one, a company of one into a company of 1,000. It’s like from a company of one to an enterprise of 1,000 becomes then the model through which we incite our new client to understand that growth is not something that maybe you do.

Growth is the only reason you started a company in the first place, that it is incumbent upon you. If you’re going to presume to be an entrepreneur, to grow a turnkey methodology that lives at the heart of your company, a dream, a vision, of purpose, a mission, and be able to expand that worldwide. In short, whatever you create is meant to grow effectively worldwide, just like McDonald’s did. You understand you’re now Ray Kroc. You’re not Jerry Smith. You’re now Steve Jobs. You’re not stupid. You’re now blessed with the process through which entrepreneurs create great scalable companies. That was the entire meaning of everything we’ve been doing since the very beginning.

This is where I go back to our brief dialogue around business then in business now because business now has a lot of shiny objects. Based on what you see and observe, are these missing components, this sequence of creation still absent with a lot of companies that are formed and created these days?

Absolutely, without a shadow of a doubt.

Can you be successful as a scalable business without these steps, without going through step 1, 2, 3, 4?

Growing A Small Business: By becoming a generalist and applying your method on every single circumstance you come face to face with, you discover the universality of your methodology.

If you look at every single scalable company I’ve mentioned, Steve Jobs and Apple, all I’m defining is what every single one of them does. I call it the Eightfold Path. I’ve redefined it in my terms, but only because I’ve taken them all apart and identified in every single small business imaginable how to organize all of that process into a process that works every single time. A process that works every single time it’s applied. Applied is a key ingredient of that because what’s required is for example what our most truly astonishing clients, and when I call them clients whether they’ve worked with us in our coaching process, our mentoring process is unimportant. Many of them simply bought the book, read the book, and then did the book.

You understand, you’ve got to buy the book, you’ve got to read the book, and then you’ve got to do the book. I’m saying that anybody who buys the book, reads the book and does the book, that does the book is critical, but the read the book is critical and the buy the book is obviously critical. You’ve got to do those three things. Ken Goodrich, who’s the Founder of an HVAC company, a contractor who failed in his first interim of growing an HVAC company. His dad hired him when he was ten years old. His dad was an HVAC contractor. Ken held the flashlight at night when he was fixing an air conditioner. Ken was introduced at the age of ten to what his father did. When he went on to college for four years in business and finance, from the age of ten through his four years in college, he worked in that business and did each and every job.

When he graduated from college, he was offered a job by all of the companies who hired college graduates to come to work in their bank, in their financial services company, in their whatever as a beginner. When he heard what they were offering him, he said, “You mean I went to four years of college to be offered only a third of what I’ve earned part-time fixing air conditioners? Why would I do that?” They said, “We don’t know but you’d have a career.” Ken said, “That’s the dumbest thought I have ever had. I wasted four years.” He went back not to work for his father, but to buy his father’s business ultimately. His father died and now Ken owned it and he began to apply what he thought he knew to operate that business until the IRS shut him down. Suddenly, he realized he didn’t know anything about the business of business, despite the fact that he’d been working in one from the age of ten and he’d been going to college to learn about business, to get a degree in business and finance. None of it had anything to do with what he had to do in order to be successful in his small business.

He was given a gift at that juncture. The gift was The E-Myth Revisited: Why Most Small Businesses Don’t Work and What to Do About It. He sat down and read it and then read it again. He began to apply it in the business. He started anew from the very beginning, just Ken doing it. Now following The E-Myth Revisited, step 1, step 2, step 3, etc. Literally applying it day by day, he had the book, he said, in his back pocket. Ken, unlike most people on the planet, admits he read The E-Myth Revisited 39 times. That first HVAC company he created, he committed to selling it in three years for $1 million. In three years, he did sell it but for $3 million. It blew him away. He decided to wait a bit. He started a new one with the intention of selling it for $3 million. He did, but he didn’t sell it for $3 million. He sold it for $4 million. Ken had the book in his back pocket and practiced it day after day because it was the secret to how he got paid $3 million and the secret for how he got paid $4 million. He said, “I can do this again and again. I get this.” He’s applying my book step-by-step. At the end of that process, he had sold, built, designed, launched and grown 24 HVAC companies, millions upon millions of dollars.

He said, “Why am I selling them? Why don’t I just keep them and grow them?” That’s what Ken did. I’m speaking with Ken to a large association of service businesses, to the owners, about 1,500 of them in Las Vegas to tell that story. We’ve done that story through nineteen different vertical markets, written a book for each of those vertical markets, The E-Myth Chiropractor, The E-Myth Optometrist, The E-Myth Plumber, where my co-author is someone who literally did it. Think about the same book, The E-Myth Revisited, applied to every single vertical market. When we’re done publishing those books and bringing those books to every single vertical market on the planet, we’ll have transformed the state of small business worldwide. We will transform the state of entrepreneurship worldwide, we will transform the state of economic development worldwide so that small businesses don’t fail at 90%, but succeed every single time.

Buy the book, read the book, and do the book. Share on X

If they buy the book, if they read the book and when they do the book like Ken Goodrich did, like the founder 1-800-GOT-JUNK?, like the founders of Infusionsoft did, like the founder of BNI did on and on. How miraculous that is. Our system doesn’t do exactly what Steve Jobs did, but I can guarantee you if Steve jobs had read The E-Myth Revisited, he would have done it in exactly that way and it would have created an astonishing result. That’s what I’m saying to every single person who’s reading this now, every single person you’ve spoken to over the years you’ve interviewed. That effectively The E-Myth is the absolutely replicable turnkey system that can be applied to every single small company on the planet, no matter what it does. Provided they have a dream, a vision, a purpose, a mission, a client fulfillment system, a client acquisition system, a franchise prototype that can be replicated faithfully every single time.

The prototypical franchise system every great growing company needs to design, build, launch and grow, plus a management system and leadership system, that will create a great growing company that can replicate its success time after time. Whether it’s doing that in Portugal, Miami, every country worldwide like McDonald’s, Apple, Google, etc., it works. Ergo, you can literally learn how to work it in such a manner that will enable you to scale it in the most uber-successful way. To truly become the great entrepreneur that resides in potential in every single one of us.

Michael, it’s been going through my mind is something I heard you say and you’ve written about, which is stop reading and start doing, which has resonated as you’ve been speaking. It’s also something that I’ve learned, which the idea of mastery is. I think a lot of people were influenced in the United States, especially to master things cognitively, get the information. There’s a degree of physical mastery, which is due to taking the information and doing something over and over. This is definitely the place where we needed to talk about some new business that you have at Radical U. It essentially takes the information that’s in The E-Myth and puts it into a directional set of tutorials and curriculum. It’s those potential entrepreneurs, existing entrepreneurs or small business owners can use that to put in practice what you’ve been talking about.

Radical U is our entrepreneurial development school online. It’s essentially a five-year school. I’m going from a company of one to a company of 1,000. It defines every single step of the way through a video tutorial and homework the student needs to do. By doing the homework, they’re shaping their dream. They’re shaping their vision, etc. to the point where they’ve grown an enterprise. Effectively, what we’re saying is if you have the dedication, if you have the patience and you have the determination. If you have the will to follow our methodology, we will teach you what every single human being on the planet must know and must do in order to create any company of whatever size to realize your dream. It’s the great result you’re setting out to produce. To realize your vision, the form that dream will take, in a brick and mortar or online business.

The purpose for which you’re doing it so that every single one of our students online can become successful in a limited fashion as a McDonald’s franchisee or even in an expensive fashion. It’s to mirror the success of a Ray Kroc or Steve Jobs, the Google boys and so forth. Pick one. It doesn’t make any difference whether it’s brick and mortar or whether it’s online, whether it’s this or whether it’s that. The process is universal. That’s our point. The process, the methodology from step one to step five to step eight is exactly the same no matter what company you’re going to start. Once you realize that, you suddenly liberate yourself from all the false promises that are made on the internet from internet marketers who are essentially telling you stories, which are built upon what everybody says to them, “I want to do it fast. Can I do this in a week? Can I do this in a month?” They say, “You can.” In short, mirroring the stupid desire everyone has when it comes to the word success. Mostly what they want is a financial success. They may want to make gobs and gobs of money.

The E-Myth Revisited: Why Most Small Businesses Don’t Work and What to Do About It

When you go on the internet, what you were going to see is an immense number of people say, “We’ll teach you how to make gobs and gobs of money,” as though they, and of course they can’t. They can’t because nothing called gobs of money happens in a week, in a month, in a year. It happens over time and it happens steadfastly when you do step 1, step 2, step 3 and master each and every one of them on the way. We’ve been telling the truth for now since 1977. There are a monstrous number of people who have copied what we say, but then say, “Now you can have it quickly.”

Michael, I want to hit on two things that keep going through my head. The first one has to do with what you’re saying right now, but I’m going to talk about the first. There are so many of these sequence patterns in life. I think going back to Maslow’s Hierarchy of Needs, there’s a sequence by which people seek things, the physiological safety relationship, self-esteem. There’s a process and a system to that. There’s a hierarchy and you can’t skip steps. I read something which was the eight or nine levels of intimacy, which is going in all of your relationships where if you skipped steps, it could be considered assault. The step 1, step 2, step 3, there’s this sequence of events. I look at also to our life in general, humans in general, we’re all born the same way. We have to learn how to walk. We learn how to crawl before we walk. Learn how to speak, learn how to interact. You can’t skip steps.

It occurs to me why would anybody think that there isn’t a sequence and a pattern to a thriving business, a certain sequence, certain steps that you take starting with one and ending with the latter one. This brings me to my final point, which is money. This entrepreneurial flash in the pan, giving people gobs of money, as you put it. In my experience, people aren’t seeking money. They’re seeking some emotion and state they associate with having money. You have talked about this, starting in your first book, which is the idea of contribution and legacy and making a difference as being that driving force. Those are the two things I wanted to say. Would you mind speaking to that as we conclude?

Absolutely and I would say that the reason why most people don’t realize that it’s a process, you have to walk before you run, etc. They don’t want to have to think that. They don’t want to have to think that it’s going to be hard work. They don’t want to think that they’re going to have to learn how to do this before they can ever learn how to do that, whatever this is and whatever that is, whatever the process is. All I’ve learned in my education and my education with respect to myself, education has been to identify what that process is. Only by doing it, testing it, validating it and then orchestrating it, we’re able to come to that conclusion. Understand what we’ve learned, earned, and earned it by practicing it. It’s by practicing it not only in our business but practicing it in every business to discover the universality of it.

If it were not universal, then it would be specialized. Everybody believes you’ve got to become a specialist, that’s what everybody tells everybody. You’ve got to become a specialist. I’m saying you’ve got to become a generalist. By becoming a generalist and applying it in every single condition and circumstance, you’ll discover the universality of this methodology to achieve a truly human resolve that lives inside of you authentically, which must be honored every step of the way. This is hard teaching because it’s teaching something that most people are not prepared to do. It’s like I’m becoming a Navy SEAL. Thousands applying, hundreds are accepted and those hundreds are already masters in the world they live in. Now they’ve got to go to school and it becomes dozens. Not thousands upon thousands who want to, not hundreds upon hundreds who have been accepted into, but only the ones who have passed the test to. Think about that. From thousands upon thousands to hundreds. What’s in between? What’s in between is the stamina, the persistence, the will to overcome all of the obstacles that are naturally incumbent for you to get there so that you can be there having passed through every test along the way. The tests are identically the same. That’s important for us to know. The tests are universally the same.

Michael, isn’t it interesting that most of the vital truth of life is inherently paradoxes? Especially when it comes to growth and the achievement of success, love or fulfillment. You experience the other end of that like the yin and the yang, you experience the other end of the spectrum. It’s incredible where you look at what it takes to have a successful business. We obviously don’t have time to go through the different roles a leader plays in a business. There are these different steps that are taken. The transition, as you’re saying, there’s tension, there are anxiety and the idea of the will to succeed, overcome challenges, overcome adversity in and of itself gives you that reward and fulfillment. Without it, there would be no reward or fulfillment.

Without it, there wouldn’t be any. They would simply be superficial. It’s making a commitment to lead an existentially true, authentic life and to discover what it is. I’m beginning the process of writing another book. I’m always writing another book, but one might say, “I’ve already read your book.” That’s only because you haven’t truly gone through the process. To understand that you might’ve read the book and it was essential as the first step in this process, but it’s never enough until you do the book. You’ve suddenly discovered that what you thought the book was about was different than what the book was about. The book I’m committed to now write is mastering the mind of a master. I want to imagine a book called Mastering the Mind of a Master. That’s the entire process. It’s not of a lot of masters. It’s of a master because once you find one, understand I’m not saying I’m that one. I could very easily say that because that’s what all my beyond fans would tell you. I’ve gone through the trouble of defining the process through which one must think like a master, which calls for one to do what one thinks like a master.

In order to create what one thinks as a master that I’ve taken the trouble to pursue that my entire life. Here at the age of 83, halfway through that passage, I can say, been there, done that, failed at that, succeeded at that, mastered that, etc. It’s only that I’ve mastered that you should pay attention to because that’s the product of my will, of my love, of my pursuit to create a great growing enterprise that can transform the state of human beings worldwide. All I’m saying is by saying, “Look up to me,” that’s not the point. It has nothing to do with me. When I speak about it, I call it not Michael E. Gerber. It did hit, I didn’t. It lives within me.

You need stamina, persistency, and will to overcome all obstacles that are naturally incumbent for you to pass every test along the way. Share on X

You’re documented in so many different areas of media, but you’re known to say often that one of the main transitions of the leadership of successful founders is when it’s no longer about you. You should chart as soon as possible.

That’s why the whole personal branding BS. I’m saying BS because it’s appealing to the ego. I’m the one and you’re going to see it immediately. You can immediately see it if you’re capable of seeing it. Most of us aren’t capable of seeing that because we’ve never grown beyond that. We’ve said enough about it. I think all of it. I think that in fact what we should do if you are open to it is have part two of this conversation and maybe even part three. In the process, something will come out that the folks you are speaking to will realize what wealth is as opposed to the wealth they think it is.

Honestly, I would love those conversations and those follow-ups because wealth is one of those totally misconstrued things. I think that people these days that have acquired or achieve what they had considered at one point material wealth realize that it’s not what they were seeking. There are so many different aspects to a life where if you were to measure those and be willing to give them up, the material things are what would be given up first. Not health, not relationships, not spirituality, but material things. It sounds so cliché, but the most important thing is that life has nothing to do with material wealth. I look at a person directing what they assume a successful life is based on our conditioning in school, in the workplace, has become superficial. I look at definitely that we need to do some follow-up because wealth is achievable. I think that the overwriting sail that propels that ship forward can be discovered so much sooner than it’s usually discovered, which is typically toward the end. If it can be understood, accepted and acknowledged in the beginning, it can make the journey so much more fulfilling.

Without a doubt and then becomes the question, “How do I say that?” All the same words are used in all of the personal growth, personal development mantras that are spoken by so many people that it all becomes the same. It’s how then to speak it in a way that it all becomes compelling. The truth about what we speak about. When I say we, I mean we have The E-Myth sword that what we speak about is original. It had never been said before. I can promise you it’s still not being said. It’s being shared, but only to the degree, the one who’s sharing it perceives it, not as it’s being delivered authentically. It’s true. You’ve got to get into it deeply. That’s why I say the process. I have a dream. I have a vision, and the expression of what a dream is and the expression of what my dream is and the etc. You’re suddenly experiencing the process that one has to go through. That’s what we do in Radical U. Radical U is a 52 weeks a year video session and each of those sections is designed to produce one result. Imagine when somebody enrolls in Radical U as a student, the first module of Radical U is the dream. Remember Dr. Martin Luther King, I have a dream set in Washington, DC? You can watch that. Everybody reading can watch that.

When you watch Dr. Martin Luther King saying that, when you experience what he says and how it comes through to you, you can for the very first time experience how incredibly alive that dream was to him. That’s how alive your dream must be, albeit your dream is different than his. The minute you hear him say, “I have a dream,” and you see that flood of people in Washington, DC listening to the expression of his passion, you realize he died for that. You understand he was shot for that. That’s how dangerous that dream was as it was perceived by the powers that be. That’s how huge that he dared to dream that in a world that did not permit one to dream that. When you listen to him now, as he expressed it way back then, you begin to feel it. Not as he did it, not even close to what he felt what he said it. You at least can understand and appreciate how deeply he felt it to commit his life to it. All the dangerous places he took it to. That’s what you’re setting out to do as an entrepreneur. That’s what’s missing every single time I speak to one.

Sometimes, because I’ve read that dream and then you hear the audio, you experience the video and they’re different experiences. Words are words. It’s information without execution, like what you’ve been talking about, having the information but not doing anything. It’s been the doing, but then it’s the conviction and being behind that creates this magnetic energy that inspires and compels and leads others. That’s why his influence will never ever die.

We could’ve gone on and on only because you’re literally deeply listening. You weren’t just interviewing me to get some stuff out. That wasn’t where we were.

No way. I prepared a bunch of stuff and I got through maybe a bullet point and a half.

I know you did. We made a connection here. I know it can go much deeper. As it goes much deeper, you’re going to have a profoundly deeper impact upon the people who visit you. As you began to have an impact, your dream is going to become formed in a way that you can see in better than you’ve ever seen it before. That dream is going to direct everything you do. The dream is the very first thing I had the dream. I read what Dr. Martin Luther King said, I heard what Dr. Martin Luther King said, and I saw him as he said it. Each and every one of those were different experiences, but absolutely necessary for that dream to come alive. It was great speaking to you. Thank you for your time.

This has been incredibly inspiring. Let’s definitely do a follow-up because I’d love to have a part two and a part three. We don’t need to spend time talking about the best ways for the readers to connect with you. We’ll just give your main website, it’s MichaelEGerber.com.

It’s Michael@MichaelEGerberCompanies.com.

That’s where they can access books. Radical U can be accessed from there. That’s the hub.

As we have further conversations, Patrick, at a different level, we’ll also find a way to connect us, you and them in a way that we all are sharing in the experience. I would like nothing better than that.

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About Michael E. Gerber

Michael E. Gerber is the founder of Michael E. Gerber Companies and E-Myth Worldwide. He has had nearly 100,000 business/coaching clients over his career and has consistently been called “the World’s #1 Small Business Guru” — the entrepreneurial and small business thought leader who has impacted the lives of millions of small business owners and hundreds of thousands of companies worldwide for over 40 years.

He is the #1 New York Times’ bestselling author of The E-Myth Revisited: Why Most Small Businesses Don’t Work and What to Do About It, Awakening the Entrepreneur Within: How Ordinary People Can Create Extraordinary Companies, The E-Myth Revisited: Why Most Small Businesses Don’t Work and What to Do About It, E-Myth Mastery: The Seven Essential Disciplines for Building a World-Class Company, The E-Myth Real Estate Investor: Why Most Real Estate Investment Businesses Don’t Work And What To Do About It, The E-Myth Contractor: Why Most Contractors’ Businesses Don’t Work and What to Do About It, and the new book The E-Myth Chief Financial Officer: Why Most Small Businesses Run Out of Money and What to Do about It.

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