The Unofficial Shopify Podcast: Entrepreneur Tales

The Fundamental Truths of Million Dollar Ecom Brands

Episode Summary

Ryan Daniel Moran on building a "real" business and becoming a seven-figure entrepreneur.

Episode Notes

Our guest today has a long track record with ecommerce: both successes and failures. We're joined by Ryan Daniel Moran, founder of Freedom Fast Lane and Capitalism.com, to discuss what he believes are the fundamental appraoches that create the enduring ecommerce success stories.

Key Moments:

As a serial entrepreneur, author, speaker, and investor, Ryan's main focus is on creating lifestyle freedom --- helping people create lasting businesses and investing the profits, while enjoying a higher quality of life, and working less.

In addition to operating, selling, and investing in multiple million dollar ecommerce brands, Ryan is best known for his work at Freedom Fast Lane - where he leads "The Tribe" and helps entrepreneurs develop their business plan, get results rapidly, and invest for passive income.

In The Tribe, he is responsible for creating 100+ millionaires, many of which occurred in 12 months or less following his philosophies on creating products people want, marketing them profitably, and creating life-long customers and brand evangelist.

Ryan's mission is to empower the next generation of entrepreneurs to create jobs, contribute to the economy, and uplift their families and local communities to create a better world.

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Episode Transcription

Kurt Elster: Today, on The Unofficial Shopify Podcast, we are talking to a gentleman who is a bigger cheerleader, champion, and authority for entrepreneurship than even myself. I am so impressed at how well my values align with this particular guest, and I am excited to share with you today Mr. Ryan Daniel Moran, a serial entrepreneur, author, speaker, investor, whose main focus is creating lifestyle freedom. All right, I like this. And helping people create lasting businesses and invest the profits while enjoying a higher quality of life and working less. This is starting to sound very similar to my own mission in life for my business, and that’s championing entrepreneurship. But in addition to operating, selling, and investing in multiple million-dollar eCommerce brands, Ryan, Mr. RDM, is best known for his work at Freedom Fast Lane, where he leads the tribe and helps entrepreneurs develop their business plan, get results, and invest for passive income, because he’s driven by the belief that entrepreneurs solve problems and the world needs more empowered entrepreneurs.

And now he’s got a new thing to share with us. He’s the founder of Capitalism.com, and his mission is to empower the next generation of entrepreneurs to create jobs, pay taxes, and contribute to the economy while uplifting their families and local communities. That’s what we need more of right now. Ryan, welcome to the show. How you doing?

Ryan Moran: Kurt, I’m so pumped to be with you. We’re gonna have to update that. Remove the pay taxes part. I don’t like that part of the whole experience, so if we could just remove the pay tax part, I think it’s perfect.

Kurt Elster: I would prefer not to pay taxes, but at the same time, I tell my… I go, “It’s my patriotic duty. I like having streets. So, I keep doing it.”

Ryan Moran: In a future life, you and I can have a podcast debating whether or not taxes are a patriotic duty. That might be a fun conversation for you and me.

Kurt Elster: I am so… I have strived to make the show apolitical. Oh, my good… What have I opened up? All right, as long as we’re-

Ryan Moran: I’m sure that won’t be the only controversial thing we talk about together, Kurt.

Kurt Elster: Well, hold on. As long as we’re on awkward topics and bad dinner conversation, I have this year recorded three episodes about alleged $75 million Ponzi scheme, allegedly, The Income Store. Ken and Kerri Courtright’s business, The Income Store, where people invested in internet businesses that was raided by the SEC in late December, I believe. And when I went online and I asked, I said, “Hey.” I asked my Facebook group. I asked in Twitter. I said, “I’m interviewing Ryan Daniel Moran in an upcoming episode, what questions do you want me to ask?” And that’s what a few people messaged me and go, “Hey, you talk about The Income Store a lot. He used to promote or be involved with or have some kind of relationship publicly with The Income Store.” So, I can’t not ask about it. What’s the deal there?

Ryan Moran: Yeah, sure. Well, I mean, I appreciate you giving me the opportunity to respond, and my background is in eCommerce, like most of us, and I had my biggest win in 2016 or ’17, when I built a company and sold it before selling eCommerce companies was cool. So, I had this eight-figure check show up from selling a business that I had built, taken from $600 to a $10 million run rate company, and I sold it and had a big win. And I had a relationship. Again, I knew of Ken through our network, and we knew each other personally, and so I was an investor, and I invested pretty heavily in what they had done, because when I knew them, they were running content sites and a model that I really understood.

Then some things changed, obviously, but I really believed in the model that they had around that time, and so they were also on my podcast. They were on my stage. And as far as everything that has happened since, the only thing that I’ll really say is I got bamboozled, too. A lot. And I have never felt more betrayed.

Kurt Elster: Are we hearing that you lost money, too?

Ryan Moran: A lot. A lot.

Kurt Elster: Yeah. I’m sorry. I can’t imagine how hard that would be, and at the same time it’s like… Okay, if you had a relationship with them and you lost that money, there is betrayal on two levels, right?

Ryan Moran: Correct.

Kurt Elster: It’s like fiscal and emotional.

Ryan Moran: Correct. That’s right. Yeah.

Kurt Elster: Did you have a moment where you just went, “What the fuck? I feel so stupid.” Did you blame yourself?

Ryan Moran: No, I didn’t have a moment. I had moment after moment after moment after moment.

Kurt Elster: So, this was like a grieving process.

Ryan Moran: Oh, for sure. Now, I’m the type that will… There was actually, there was a couple weeks where I was really upset, like couldn’t sleep at night kind of upset. And finally, I just… It’s very much like the pandemic. We’re recording this right now during quarantine. And it was very much like the sense of you’re glued to the news about the thing you can’t keep your attention off of, but eventually you have to just say, “Does it even make sense for me to keep paying attention to this? Or do I just need to let the process flush out and put my attention on anything that feels reasonably better?”

And so, my attention went to supporting my clients, and creating a lot of content, and being there for my family, and making money in other ways, and asking the question, “Okay, well, now that I have normalized losing a lot of money, is it really so bad if I lose everything?” Because we all have that fear of what happens if it all goes away, right? What happens if I have to go work at Walmart and move in with mom?

And when one of your biggest investments goes up in smoke, regardless of how it plays out, if it goes up in smoke, you have to deal with those thoughts. And so, I just dealt with it as an opportunity of getting through that, of getting over that fear of what if it all goes away. And now I know it can all go away, and I’m a smarter investor. I’m a smarter reader of people. I’m a better person on the other side of it. I know 10 years from now, I’ll probably look back and say, “Man, I really learned a lot and grew a lot from that.” And it sucks in the short term, but I kind of just cling to the fact of what will happen in the future.

So, that was how I navigated my way through that.

Kurt Elster: Let’s assume that this is a teaching experience. What changes do you make in your life as a result of this? How has it changed you going forward?

Ryan Moran: Oh, that’s a deep question, Kurt. I mean, moving forward, I… Oh my goodness. Always call references. Always, always, always call references. When you’re hiring someone, when you’re betting on someone, just always trust but verify.

Kurt Elster: And I think that sounds obvious, but it isn’t. It’s important, because when you meet someone and they seem likeable, and I had lunch with Ken Courtright. I met him. He seemed very nice and pleasant. It’s easy to feel guilty or bad, like, “Oh, wow. I’m just being paranoid and distrustful of people,” if you check references. It’s easy to talk yourself out of it is my point.

Ryan Moran: Yes, but it also puts you into an authority position if you are the type of person that shows you’re willing to call references.

Kurt Elster: I like that mindset shift.

Ryan Moran: It’s I’m the one with the money and the hot girl at the dance, and I really like this conversation. I need to verify some things. Can you bring me some references? Now, but an even bigger lesson for me, like the thing that I actually in tears told somebody close to me, I was like, “I think I finally got the lesson of the danger of pursuing short-term wins versus long-term wins.” I think I finally got the lesson of looking at how things are going to look in the very, very long-term versus trying to make decisions that are going to be expedient in the short-term. Instead of looking at the next three months, let’s look at the next three decades.

And I’ve always had the experience that when I make the longer-term decisions I can make, the better results I get even the short-term, and this was just kind of the final punch in the face of, “You should always look to the long-term, rather than what the immediate win is.”

Kurt Elster: Okay. I like that. Yeah. We gotta think longer term, and I like that mindset shift of it puts you in an authority position to be the one who’s willing to check references and look into backgrounds.

Ryan Moran: Very simple expensive lessons for me, Kurt.

Kurt Elster: Very expensive, very painful. Any closing thoughts here before we move on from it?

Ryan Moran: I know a lot of people are hurt by this, and the one thing I’ll say is me too. I really… I lost a lot and I feel really betrayed, and so I’m just kind of in it with everyone else.

Kurt Elster: Okay. All right. Well, we’ll leave it there. This now counts as like episode four about The Income Store. And I’m sure as that case evolves it’ll come up again. But for now, I want to hear about some positive things, so let’s talk about your approach to the pandemic. All right, not quite positive, but you did say an interesting thing to me in the pre-interview about how you’re approaching it. And you referenced a little bit just now. How are you dealing with the ongoing pandemic, our bizarre new normal?

Ryan Moran: Well, I’m not. I’m not dealing with it.

Kurt Elster: What?

Ryan Moran: Yeah, I’m not. I like to track the numbers. I like to see the trend of it. But no part of me is wrapped up in the overall chaos of the experience. I’m of no use in that mode. I’m of absolutely no use to myself or to anyone else to put attention or focus on what might happen, what is happening, what could happen, because we don’t know. So, what is the point of speculating? What is the point of blaming? What is the point of putting any negative attention on it? I’ve simply removed my attention from any bad news, and I have only consumed good news. I have only consumed what I’m going to take from this and how I’m going to move forward.

And some people have accused my of having my head in the sand, and I think it is equally having your head in the sand to be constantly consuming negative news about the pandemic and trying to make life decisions based on that. So, I’m certainly not giving any attention to the negativity of it, and I’m putting all my attention on the positive side of all of this. And there’s a lot there if you decide to look for it.

Kurt Elster: Well, all right. Tell me what the positive side is. What are you seeing that should be making us feel cautiously optimistic?

Ryan Moran: I am getting in the best shape of my life. I’m spending so much time with my kids. I’m getting so much thinking done. I’m doing so much writing. I’m calmer than I think I’ve been in years. I’m sleeping eight hours a night. I am enjoying the clear schedule and not having meetings. These are all things that are wonderful or terrible, depending on how you look at them. “Oh, I’m stuck at home. I can’t go to the gym. I have nothing to eat. I am bored.” These are all the negative side of it. The positive side is I have a clear schedule, which gives me lots of time to think.

The positive side is, “Wow, this is really forcing me to learn how to not be on my phone all of the time.” This is really an opportunity for me to practice presence and appreciation and having control over my own mindset. I think I’m probably 30% happier during this time, and I really caught why that is, and I think a lot of entrepreneurs are experiencing something similar, where they’re feeling less stress than normal, and I’ve had conversations with entrepreneurs who are like, “I feel bad that I don’t feel more stressed.” And here is my fast analysis of it: In the entrepreneurial world, especially the internet entrepreneurial world, where we are in constant communication with one another in the form of projection, we project what we are doing onto social media, and we then read other people’s projections. We are in a constant mode of comparing ourselves to one another. A constant mode of seeing other people’s wins and comparing them to how we feel on a moment-to-moment basis.

And what this ends up doing is putting us into a bit of a rabbit hole of making fast, short-term again, decisions of pursuing expedient results, rather than meaningful results. Of us chasing after the results that other people are projecting that they are creating for themselves. And all of a sudden, all that got turned off and there was one piece of bad news that everyone is talking about. The result is since I don’t have anything to compare myself to when it comes to the coronavirus, I now have no comparison left. I’m only left with the life that I have and the judgments that I make about the life that I have. And that is a beautiful place for you to discover what you want, and what drives you, and what you want to do next, and what you want your life to look like, and where you… I mean, it is just a beautiful opportunity to do that type of exploration, and that’s how I’ve taken it, and I’m enjoying it, and there are lots of things that I will not go back to normal, I will not go back to doing once quarantine is over.

Kurt Elster: That is quite the powerful mindset shift. You like that? That’s me, just really pitch shifted and slowed down, too. What was I gonna say? Okay. Actually, my wife is an eternal optimist, and I was really struggling with the quarantine, with being at home, with having what felt like all of our lives put on hold. And she was not struggling it with it nearly the same way I was. And yet her business was far more impacted negatively than my own. And she said, “Hey, it’s all in how you look at it.” She goes, “You’re in your house with your loving family, with a bunch of free time, and you can still work from home and your business continues. How bad could that possibly be?”

Ryan Moran: Yes.

Kurt Elster: And when she said that, I went, “Oh, shit. She’s right.” And rapidly, the more I thought about it, over the course of the next week, I really started doing significantly better. Like I was having just a lot of… That’s like a grieving process almost. I was having a lot of anxiety, and depression, and losing sleep, and it was because I was just nonstop consuming news, and actively worrying at my situation as thought it were my full-time job. And of course, to your point, that’s not in the slightest bid productive. When you invest all of your energy into being terrified of your situation, you’re not gonna get anywhere very quickly, now. Are you?

Ryan Moran: That’s right. That’s right. It’s absolutely paralyzing. And so, the only rational thing in my mind is to turn your attention away from that which is paralyzing, and to look for that which is empowering, motivating, and inspiring. And you will find it if you look for it, and there are people who are so fixated on what they consider to be the problem, that they can’t. At least not immediately. They can’t turn their attention away from it and towards something that is positive, and they would even say you’re unethical for turning your attention towards the positive.

Kurt Elster: This has happened to me already.

Ryan Moran: Yeah. Me too. But you can’t serve… Hell, my business is called Capitalism.com. I don’t think that you can help poor people by joining them. I don’t think that you can help sad people by being one of them. I don’t think you can help negativity by jumping into the pool of it. You only create the change that you want by becoming it and leading the charge. And so, I’ve just turned my attention away from the negativity and towards what it is that I want to focus on. I think if everything else is taken away from this, I think this is a Viktor Frankl quote. Man’s ultimate freedom is the ability to choose his own focus. To create their own meaning. To turn their attention away from that which what they don’t want, towards what they do want. It’s like our basic human freedom, and it’s the only way that we create the experience of life we want.

Kurt Elster: I want to do some time traveling here. Ultimately, I want to know why and how you became an entrepreneur. And to do that, I think we need to go way back in time. I have found old articles about you from Forbes.com, talking about successes you had like way back in I think 2013. You’re a fairly young guy. We’re similar in age. We’re both in our thirties. So, take me back. What happened that you’re now here as this internet authority?

Ryan Moran: I tell the story in my book about when I was chatting with my father at age five or six, and hearing the term, “A million dollars,” and asking about how much money a million dollars was. And my dad was a teacher, and he taught at both a local university and at the high school full-time, and he said to me, he said, “Well, a million dollars is like this. If I worked for my entire career, which is about 30 years, and I never spent a dime. I would make about a million dollars.” I was like, “What? Okay, so in order to be a millionaire, this term that I’ve heard, you would have to work your entire career and never spend any of it.”

And I don’t know why, but that, like a piece of software code, got into my brain and planted seeds and I just decided I was gonna be rich. And it’s funny, I now will go back to my childhood. There was never a doubt in my mind in my childhood that I was going to be successful. Now, I didn’t know what the term entrepreneur meant until I was like 12. I just knew that I was gonna be successful. And so, at age nine, I discovered what a stock was. My mom put me on this subscription for this magazine called Zillions. It was Consumer Reports for kids.

Kurt Elster: I remember this.

Ryan Moran: Do you really?

Kurt Elster: I do.

Ryan Moran: You’re the only person I have ever met who knows that reference. That’s amazing.

Kurt Elster: Starting at like age seven or eight, I started just finding the magazines in our library and reading them. All the kids magazines. And yeah, I remember it started with Boys’ Life and ended with Zillions, and then later, ultimately Car and Driver type stuff.

Ryan Moran: Yeah, I loved it. I loved Zillions Magazine. And there was one… There was like one article in there about this kid who had made like $30 investing in stocks, and I remember going to my mom and I thought for sure she was gonna tell me it’s a scam. And you know, so I went to mom and I was like, “Mom, I want to buy stocks.” And she was like, “I think that’s a really great idea for you.” I was like, “Wait, what? My mom signs off on this?” I’m like eleven. Maybe some warnings about scams would have served me later in life.

But I started reading stock book sand discovering what the Dow Jones Industrial Average was, and stuff like that, and you know how it is. You open up the flood gates and then you go on and on and on. I discovered eCommerce in college when I started doing affiliate marketing and search engine optimization, and I really made my first million doing SEO, affiliate sales, and doing a few product launches. Never really liked it, because it always felt kind of skeezy to me. It always just… It felt like selling air. And, I mean full disclosure, I have a continuity program. I do some mentoring. I guess I still do sell some air. But the whole like launch and burn model never really made sense to me.

But I discovered that through being an internet marketer, if you took all of those skills and you put it into what I would call a real business, you can do a lot of damage real quick. And all my friends were just after the short-term cash, going after the cash flow, because they wanted freedom. They wanted just to have a life at their own choice, but they were really slaves to launching products, or running the next ad, although this was before Facebook ads. And I discovered that a little bit of good marketing and good business prowess, when applied to a real business, you beat everyone else who’s trying to get up there without it. And we see that in our industry now, in eCommerce, where you have the people who are trying to sell the discounted thing, or to sell widgets, and then you have the person who goes in and builds Stitch Fix, or builds a real company, who’s building a real brand. Those are the businesses that are built, scaled, and sold.

And I think there is a little bit of a logical progression that has to happen there. Once you realize that you can take a sale, then if you take that skillset and you start building a brand with it, you can have a multi-million-dollar business. You can have a business that can be scaled and sold. So, that was my trajectory, built and sold a couple companies, and now I invest in companies and Kurt, that’s how I became an entrepreneur.

Kurt Elster: So, I heard a couple comparisons there. There was like short-term versus long-term cash, and-

Ryan Moran: It’s a theme.

Kurt Elster: I heard the phrase real business several times. What’s the opposite of a real business? What’s a fake business?

Ryan Moran: A fake business would be something that does not have a lasting product and a lasting customer base that wants you specifically. So, what I teach people to do in terms of eCommerce is you don’t launch product number one until you know what products two, three, and maybe even four are. And the reason for that is if I can get someone to focus on the person, if I can get them to focus on the first buyer, if I can get them to focus on the person that is going to become the raving fan of the brand and the business, then we’re gonna make a lot better decisions. It's easier to sell to an existing customer than it is to a new customer.

The fake business, what I would consider not a real business, is the person who is only making money on the front end, who is driving a bunch of advertising or attention to just a front-end transaction, and there is no customer experience or back end. And the reason that’s not a real business is because you don’t have the experience of creating something that the customer wants again and again and again, or coming back to you for more and for more and for more. And I think that’s the difference between a product-based business and a brand. A brand can have multiple products that last for years or decades, whereas a lot of people who are asking question of just, “What product do I sell,” are chasing after a short-term win. And that’s okay at the beginning of your career, but I know a lot of entrepreneurs who never make the pivot of going from the short-term win to building something that’s really lasting.

And when you focus on building something that’s really lasting, then you can build a business that you can sell and invest terribly or well.

Kurt Elster: I would… My only caution here is if someone heard that and goes, “Wait, that sounds an awful lot like my business,” that’s not… That’s okay. It’s not necessarily a bad thing. Everybody has to start somewhere, and you are learning a whole series of valuable skills and experiences.

Ryan Moran: And it’s an easy pivot, too.

Kurt Elster: Yes. So, what do you think… Well, that sounded like a lot of early Shopify stores or drop-shipping focused stores, where they’re just chasing after… You said the widget. It’s like, “All right, who’s the first guy to find fidget spinners?” That kind of thing.

Ryan Moran: Yes.

Kurt Elster: And when someone builds a business like that, it is not about a brand, a person, a story, an experience. So, I call those vending machine businesses, because they are based purely on the transaction and the volume of people you can push through. And you said there’s no focus on the experience or the back end. Define for me or maybe give me some examples of… Well, actually, you know what? Let’s do it as a thought exercise. I’ve got a drop shipping store. It sells whatever the trendy widget is. And it’s successful in driving traffic conversions. That’s all it does. And you said, “Look, you gotta do the pivot. The pivot’s not as hard as you’d think.” Okay, walk me through that. What’s that pivot look like?

Ryan Moran: Sure. So, you brought up vending machines as the example, right? So, you know what would be a not real business if you were in the vending machine business? Having one vending machine and then going to your computer and hitting refresh all day to see how many people passed the vending machine and optimizing for your conversion rate, so that more people buy snacks.

A much better way to run that company would be to go find another place to put a vending machine. To go find what the demand is in the marketplace and decide if we’re gonna change up what we put into our vending machines. To discover the next advertising source for our vending machines. To see if we can make vending machines faster, cheaper, and better. To ask our customers who are going to the vending machine what their experience is like and seeing if we can optimize for it. And as time goes on, we discover a better way to build the vending machine that is of higher profits, and better service to the customer, and now we can go sell vending machines around the country and have a billion-dollar business. That, to me, is having a real business, whereas most people are just hitting refresh on their vending machine sales over and over and over again.

So, if you’re in that position, where you’re taking sales on your Shopify store, and you’re kind of in that trap, you’re probably focused on front-end acquisition, rather than building a business. So, my primary question to somebody who is going through that experience is who is the customer and what do they want? And can we go out and go get a second product that we have more control over, or can we go have an upsell that is a higher quality product than what we’re selling right now? Is there a pivot that we can make in order to serve that person on their journey, rather than just take sales for ourself?

It's such a weird paradox of the world that when you are thinking about the money that you’re going to make from your business, you end up making terrible decisions for the customer and you go out of business. But when you put all of your focus on what does the customer want and what does their experience… What is their experience going to look like when they’re engaging with me? You end up getting rich. And so, if we can make that switch, and sometimes I’ll just tell somebody, “All right, you’ve got 10,000 buyers sitting in your Klaviyo account, or your Active Campaign account, let’s send a survey to them and ask them what they want.” And somebody will say, “I don’t want them to unsubscribe.” You haven’t emailed them in three months. Just send the damn email.

And so, the pivot is taking away from the front-end transaction experience and putting it towards discovering who the person and the customer is, so that we can develop more products, more engaging ads, more valuable content that is going to serve them on their journey, and it requires you to pause for half a second on the distracting refreshing of the vending machine to put your attention on building something that will ultimately serve someone other than yourself. And the weird paradox of that is if you do that, you become more successful.

Kurt Elster: So, what I’m hearing is the big people are making is when they get to their initial success, then they spend their time just micro-focused on refreshing that Google Analytics dashboard, their Shopify Analytics dashboard, and obsessing over single, momentary KPIs, like page speed insights, as opposed to the bigger picture and really largely the thing that will serve both parties, the customer and the merchant, is focus on that relationship with the customer, and develop that, and serve the customer, and then profit comes from that.

Ryan Moran: That’s correct. I disagree with zero of that. I’d phrase it just slightly different, and that is the trap is thinking, asking the question, “What can I make from this? What’s my profit gonna be on this?” That’s the second question. The second question is, “Can I do this sustainably? Can I do this profitably?” The first question is, “Who’s the customer and what do they want?” That’s the first question. And everything opens up from there. Most people, I sometimes do a workshop at my home, and I tell them business isn’t hard. It is define who you’re selling to and give them what they want. That is business 101. That’s all it is.

Most eCommerce people skip step one. And they just start selling things. And they wonder why they’re stuck. It’s really hard to scale selling things. You are now dependent on other platforms. You are dependent on staying on the hamster wheel, coming up with new ads. New ways to do things. But it’s really easy to scale people when you know who they are, especially right now. You can go acquire as many people as you want. There’s seven billion of us and we have access to two thirds of them via the internet. So, getting more people is the easy part. But most people skip it and they go out and they just start selling things, because they’re not really trying to build a real business. They’re trying to fight for their freedom. And I so commend that. I just wish they knew that if they did it in order, they’d get freedom a lot faster.

Refreshing your vending machine account, that is not freedom. That is not fun. That is just as much enslavement as working a full-time job, and you might even be working more when you’re in that mode.

Kurt Elster: So, step one then should not be find the product. It should be build the list.

Ryan Moran: Perhaps. Step one is asking the question, “Who wants the product?” Or, “Who’s the market?” So, some people will do this subconsciously, so if you take something like somebody who’s really passionate about CrossFit, and they go out and they create a new machine for CrossFitters, they have already answered the question, “Who is this for?” It’s for the CrossFit crowd. That is assumed, because they developed it really for themselves. But most people who enter into the entrepreneurial game, who are saying, “I want to make money,” start looking for the product to sell, rather than looking for the market first.

But if you decide on the market first, I want to sell to CrossFitters, then you can easily come up with the three to five products that that person is going to want to buy. They’re gonna buy gloves, they’re gonna buy chalk, they’re gonna buy a gym membership, they’re gonna buy protein bars, they’re gonna be paleo foods, they’re gonna buy pull-up straps, they’re gonna buy recovery tape, they’re gonna… I just listed seven and I’m not even a CrossFitter. And so, what that does is it gives us a very specific target for which to operate and to serve, for us to create the products that are going to serve that market. Now our advertising just got a lot easier. Our influencers and affiliates just got super clear. Our messaging just got way more targeted. The way that we know if our product is gonna really succeed got a lot more narrow and a lot more clear.

Whereas most people skip all of that. They skip the question of who this is for and they look for trends. They look for profit margin. They look for sales volume. I work with a lot of Amazon sellers who are using tools to just look at the data of what the traffic gives them, what the sales are, and I go, “This is the worst decision to build a business. You can make a product that sells, but you’re not gonna build a brand and a business that you can scale and sell, because you’re now looking at data that doesn’t match the primary question, which is who is looking for this and what do they want?” If you were to back up one step and ask that question, and then say, “It looks like they want this product.” I would say, “Great, what’s your second product gonna be?”

And once they’ve got three of them, now we can go build a brand.

Kurt Elster: So, I want to know number one, who’s buying, I want to know why they’re buying, I want to have something to sell them up front, and then I need at least two more things that I can sell, either as a cross-sell or upsell, a post-purchase sequence, or maybe a product launch soon after. Is that right?

Ryan Moran: Yeah. I mean, I got my notoriety for saying one really, really simple thing that sounded super smart, and it was if you’ve got four products that sell 25 sales a day, that’s 100 sales, and at 30 bucks a sale, that’s a $1.15-ish million a year business. You now are a seven-figure entrepreneur. Now, what most people will do with that is say, “Great. Let me find four products to sell.” And I say, “No. Go find the person that wants to buy four products.” Because then you only need 25 people a day. You don’t need 100 of them. You need 25. And we can build really good systems to turn a small group of people into raving fans. We can do a lot to serve a small crowd of people, to give them exactly what they want, so that we now have four products that sell 25 sales a day. It’s just faster, easier, and simpler to focus on the who up front and then what they buy after you know their language and you’re communicating with them becomes a very, very simple process.

Kurt Elster: Do you have an example from your own experience, or maybe one you like from someone you worked with?

Ryan Moran: Yeah, so let’s take an example that we’re probably all familiar with. I’m sure a large percentage of us at least know who Gary Vaynerchuk is. Gary Vaynerchuk’s primary business is the chairman of VaynerMedia, and his side hustle is his own personal audience. Now, he doesn’t sell anything directly to his personal audience, but he does launch companies to his personal audience. We’ve seen that with his K-Swiss deal. We saw that with Empathy Wines. We’ve seen that with his WineText club. And so, he launches businesses to that specific audience. He could not do that if he did not have people who were paying attention to him.

Another example, and again, these are just famous examples to make the point, Kylie Jenner is the world’s youngest female billionaire, not because of her TV show, not because she’s a reality star, but because she has an engaged following and she knows exactly what they want and what they want to look like, and so she’s able to develop beauty products that went from zero to a billion dollars in two years. That’s-

Kurt Elster: That’s pretty wild, isn’t it?

Ryan Moran: We’re talking about… It’s crazy, right? This never happened before. These are completely unprecedented times. We overlook it like, “Yeah, of course. Because it’s Kylie Jenner.” But do you realize this is a 22-year-old billionaire because… Not because of any… There’s lots of Kardashians and Jenners. She’s the only one that’s a billionaire, because she launched an eCommerce company to her existing following. Now, my lesson for this is not go become famous or build a following. It is to know who the customer is, so that you can build a brand around that audience. Whether you partner with an audience, like one of my acquaintances is named Brian Lee. Brian Lee is the founder of ShoeDazzle with Kim Kardashian. He founded The Honest Company with Jessica Alba. And he founded LegalZoom with Robert Shapiro. Is that the famous attorney?

Kurt Elster: Yes.

Ryan Moran: And then he founded Art of Sport with the late Kobe Bryant. His entire strategy is to go find the audience, concentrate it around one person. We would call that an influencer. I don’t know that he calls it that. He usually calls it his partner. And then he goes and builds the product that that group wants, and that person talks about it as the PR face of the company, and a business is started. That’s how he launched LegalZoom. It’s how he launched The Honest Company. It’s how he launches all of his businesses. Super smart model.

What does that look like for us on a micro level if we don’t have 4 billion-dollar companies on our resume like Brian has? It’s either three or four. If we’re a bootstrapping starting entrepreneur, what does that mean for us? Well, it means that if we answer the question of who is the person and what is the journey that they’re on, then it makes it really easy for us to go find micro influencers, or significant influencers, or run targeted Facebook ads, or find affiliates, or go find blogs, or find out what the buying journey of that person is, so we have absolute clarity about what product number two, product number three, product number four is.

Now, that is just a much simpler process to building a successful, scalable seven-figure business. Now, contrast that to the way that most entrepreneurs go into this, which is, “Looks like all of the money is in fidget spinners. Looks like all the money’s in CBD. Kurt, have you seen the numbers on CBD oil?”

Kurt Elster: Right. They chase trends. They see a niche, or they see some case studies, or some other people holding up their success, and then suddenly everybody else jumps into that. When-

Ryan Moran: They’re chasing the product to sell.

Kurt Elster: They chase the product as opposed to-

Ryan Moran: Rather than the person that they are serving along their journey. I had a CBD client, and I was like, “Look, your biggest… The biggest thing that’s holding you back right now is that you think you’re a CBD company. You’re not. If you were to simply make a switch to being a pain-relief company, and you didn’t even give mention to the fact that there was CBD in your products, and you just went and made the best damn pain-relief cream, the best damn pain-relief whatever, you’d kill it. Because you could speak exactly to their pain points, rather than talking about this stupid idea of CBD oil that nobody cares about. They only care about the relief to their pain.”

Kurt Elster: Yeah. The difference is one solves a problem, the other is just a feature. It’s like straight up, it’s benefits versus feature. But when you’re getting into solve the pain or problem they have, okay, now it has real value to that customer.

Ryan Moran: It does. But the important thing is that you’re focused on what the customer’s problems and desires are, and you build a business that is in operation to do that. To address those problems. To address those desires. Not just sell the next product and convince the person that they want it. That’s really hard. It’s hard for me to convince you to do something. It’s easy for me to see what you want or need and to go connect you to it, or to create it. I know I’ve got a customer in the latter scenario. I’m fighting an upstream battle trying to convince you to buy my new thing.

Kurt Elster: So, if we know, like the number one… What you perceive is one of the number one problems, and I agree, with eCommerce and online entrepreneurs today, is they chase the product and the trend. And part of it’s because of a democratization of access to both the data and the manufacturers, the suppliers, the vendors. So, between the two, building an audience and finding the thing to sell, finding the thing to sell is much more accessible. It’s much easier. So, what would be… What’s your advice for folks just starting out, trying to find the audience? Trying to build that list, that audience, and that engagement? Because I gotta find that before I can get… figure out how to serve them.

Ryan Moran: You’re probably already sitting on it. So, if you’re an entrepreneur, you’re in this game probably because you want freedom. Probably because you want life on your own terms. Probably because you want to have an exciting, enjoyable life. And what most people will do is they’ll say, “Okay, I’m gonna put the enjoyment part on hold for like five years, and I’m gonna go build a business, make a whack ton of money, and then I will enjoy my life.” And so, their business actually becomes like the antithesis of their freedom rather than the thing that they are enjoying along their journey for freedom.

So, if we start with who’s around me right now that I’d be excited to serve, or what am I into that I’m genuinely fascinated by, that I could build a brand around? My first business was a fitness and workout company, because I’m into that kind of thing. Then I bought Capitalism.com, because I’m kind of into that kind of thing. And so, if you look at your interests, where you spend time, attention, or money, we usually get a good snapshot of the type of people that you might like to serve, because you’re really serving yourself. Or someone close to you. So, if you’ve got young kids at home, we might be looking at new moms, and all of a sudden when you become a parent, you start to see all this weird stuff in your house that didn’t exist before and that you had no idea was a thing, and all of a sudden, you start looking at other people’s strollers, going, “Where did you find… That is a really cool stroller.”

And you see the sound machine and you’re like, “This sound machine is really…” And you start seeing all of these things that you didn’t see before.

Kurt Elster: Yeah, I got opinions on sounds machines now that I didn’t have previously.

Ryan Moran: Do you? I would love to hear. But the focus goes to, “Okay, I now around me see that there’s an opportunity that I didn’t see before, and I could get excited about serving that crowd. I could get excited about serving new dads, who are navigating this crazy journey and are pretty much worthless for the first 18 months. We’re basically gophers for the person that is doing all of the heavy lifting. So, I could get excited about serving young, new fathers. Or I could get excited about supporting new moms, because it makes me feel useful to be able to develop something that would genuinely help my partner, or the world at large, or someone that I know.”

So, if there’s someone around you that you can focus on a journey that they are on, or a journey that you are on, all of a sudden, the path becomes a lot simpler and clearer. Because the best time to get a customer is when they’re at the beginning of a new journey. They’re starting a journey for weight loss. They’re starting a journey for fitness. They’re starting a fitness to start a business. They’re starting a journey to become a parent. They’re starting a journey to conceive. They’re starting a journey to date. They’re starting a journey to start a podcast. These are all people who are beginning some sort of new journey and experience, and if you pay attention to the ones that you are on, or have been on, or the ones that people around you are on, all of a sudden you can watch their journey and start to develop products that they or you wish had existed at the beginning of the journey.

And so, I don’t think it is about going and looking at the data for the market. I think that’s a mistake, especially when you are first starting out. I think it was a much more energizing, exciting experience to look at the journeys that you’re naturally motivated and excited about or looking for the people that you’re excited to serve, and that’s how you start getting ideas for that brand that you start.

Kurt Elster: I love that idea, and I have subscribed to it myself for some time. There are people who are total mercenaries, and I respect them, who can just get excited about the process, and I’m gonna build a business, and that’s that. But it is for mere mortals like myself, it is so much harder when you are not personally passionate about your niche, your arena, whatever it may be. So, if you can pick like a hobby or interest that you’re really excited about, life becomes much easier. Both because you have a much better understanding of it, you have a personal insight into it, and you love it. Those three things really will motivate and compel you to move forward, and they give you a leg up. You have an unfair advantage when you understand that hobby that other people don’t. And maybe you already engage in the community and don’t even think about it, like a Facebook group, a subreddit. Something. Or a blog, where you share it, and you’re already starting to build some authority in that space.

And hopefully you have a network where you can talk to other people, maybe friends or family that share it, and start going, “Hey, am I the only one who thinks that this one particular thing is a pain, and the existing solutions aren’t great? And maybe we could do it better?”

Ryan Moran: Kurt, I’m so glad you said that. There’s two things I want to respond to here. First, to this last point you just made, when you realize how few people you actually need to have a really successful business, and you probably already have the connections that you need in order to have all the happy clients and customers that could make you successful and free and happy, man, life gets real good, real fast. Because you’re right, you probably are already in that Facebook group, or that subreddit, or that physical Meetup, or you know the people that know the people. If you can make a list of 10 people in your network that you know that you can call and they’ll answer, that are the avatar of the person that you’re targeting, and they post about your stuff on launch day, you will make sales. You will make money. And that’s one of the things that I tell people to do, is line up those 10 people who look like the person who would be excited about your business or your brand and get them to share about the product.

I don’t care, if they’ve got a thousand followers or a thousand friends on Facebook. 10 of them is 10,000 people. It’s a micro influencer. Great work. You just got your first free micro influencer in the network that you’ve built over your lifetime. They’re called your friends. That is… If somebody gets that, we will radically change their life.

However, the other thing I wanted to mention, you brought up the person who is the mercenary that just is good at selling things. There’s lots of them. Hats off to them. I wish… I think at internet marketing Meetups, when you go to the big conferences, those are the ones that we all wish we could be like, because they just sit there and talk about their Facebook ad conversion rate, and how many sales they’re making, and I got… I wish I could be more like that, but I’m like you, Kurt. I need to be excited about what I’m doing, because I’m in this game for an exciting life, not just to make sales.

But to the person, there are people out there that just get excited about the growth of a business, and they’re agnostic to what the business is. And I wish I could be more like that. But to that person, I would say if you are not following the process that Kurt and I are talking about on this podcast, where you’ve got the target market and you’re scaling to the market, rather than just selling more product, then you don’t have a business that you can sell. You don’t have a business that can be acquired by someone else and it be valuable to them. You’ve got a sales machine; you don’t have a real business.

So, your job is to take whatever sales machine you’ve got and look at the who behind the purchases. Look at the who behind the transaction and get insanely curious about what that person wants more of or less of in their life and go develop the products and the services that will serve that person, and that’s how you will have explosive growth.

Kurt Elster: I like that. Man, that’s… I don’t think I’m gonna ask any follow-up questions to that. I think we’ve really-

Ryan Moran: We did it.

Kurt Elster: We laid out a pretty good strategy. Certainly, we’re scratching the surface, and the more I learn, and I’ve been doing this for a decade now, is that entrepreneurship and business is like an onion. You’re constantly pulling back layers. There is no end to it. But I think that… I like… Your standard entrepreneurship operating procedure feels good for me.

Ryan Moran: Can I throw a layer of your onion in you?

Kurt Elster: Please do.

Ryan Moran: At you?

Kurt Elster: Don’t throw onions in me.

Ryan Moran: Yeah, yeah. Okay. So, I completely agree with you that it’s an onion, but you are the onion.

Kurt Elster: Whoa! All right, mindset shift.

Ryan Moran: Yeah. You are the onion, and the real process is peeling back that onion, and business is one of the layers, and it has its own layers, but it’s really peeling back you.

Kurt Elster: I think that’s… It’s one of those situations where you’re laying awake at night and you think about like that embarrassing thing you did 10 years ago, and you realize you should have those moments. You should be terrified if you never have those moments, because it means you’re not growing. It means you’re not peeling back the onion.

Ryan Moran: That’s right. Yeah, embarrassment of your past self is a really good sign that you’re growing.

Kurt Elster: Yeah, that is a painful but powerful indicator of growth. All right, so I have to ask you about your new book being released. It’s called 12 Months to $1 Million: How to Pick a Winning Product, Build a Real Business, and Become a Seven-Figure Entrepreneur. Sounds familiar to our discussion, good sir. So, tell me about this book. What… Go ahead.

Ryan Moran: Yeah, I’m really excited about it, Kurt. So, I wrote the book 12 Months to $1 Million, that is basically the playbook to do exactly what we’ve talked about, which is identify those four products, get them to 25 sales a day, and have a million-dollar business. It’s a 12-month roadmap. It’s broken up into three sections. Those sections are the grind, the grind is figuring out who your market is, figuring out how you’re gonna launch this, figuring out what those first products are going to be. The second stage, which is usually three to four months long, is the growth, which is getting that first product to 25 sales a day, and running the marketing, and the systems, and the processes to be able to sustain 25 sales a day. That’s what does your launch look like, it is what does your pricing strategy look like.

And then the last three to four months are called the gold. It’s where you repeat that process over four different products, so you have a million-dollar business. And I teach it to the context of helping several hundred entrepreneurs go through this process, myself included, where I built a company starting with about $600, and took it to an eight-figure exit, which I document throughout the journey.

So, if you’re the type of person who is ready to make this pivot that we’re talking about, of going from, “I know what I’m selling, but I want a real business.” Or, “I’m a hustler who knows how to put up a Shopify store and run ads.” Or, “I am making sales actively, but I don’t have a business that I can sell one day, because I’m really just building a sales machine.” And you want to build a real business and a real brand that can be scaled and sold with real customers, and real profits, and real growth, then this book will help you make that shift from that more hustler mindset to more of an owner mindset that is building something that matters and can be sold.

Kurt Elster: I love it.

Ryan Moran: And the book’s called 12 Months to $1 Million.

Kurt Elster: This is… I’m gonna read it. I have not been reading much in quarantine. I think this is a missed opportunity for me. Because I used to rely so much on Audible on my commute, and I’m going to start reading again, and I’m gonna pick up your book. It sounds genuinely good.

Ryan Moran: I appreciate it. Thank you. I enjoyed every minute of writing it. Some people… I kind of in another life was a writer. Just I love the process, and so my heart and soul is in it, and you can probably smell the blood on the pages.

Kurt Elster: Oh, all right. With an endorsement like that, how could you not read it? It smells like blood! Blood and onions. Personal onions.

Ryan Moran: That’s a funny one. Yeah.

Kurt Elster: All right, so final closing thought. What is one thing you wish every entrepreneur would do, or everyone who listened to this episode would go do with their eCommerce businesses?

Ryan Moran: Be easier on yourself. I really think that as entrepreneurs, we take so much on our shoulders, and expect of ourselves to run with it, and to go pound pavement, and to beat ourselves into the ground. Most of that’s an illusion, and it’s also not what we wanted. Most of us got into this game because we wanted to be freely at choice, and some will hear that and say, “Yeah. Well, I love to work. I love to build my business.” That’s awesome. But it’s probably also not the life that you envisioned when you were a kid. We got into this as a route for something else.

And so, the reason that’s so important is if you let up on the ease of… If you let up on the pressure that you put on yourselves to always be winning, to always be succeeding, you end up having a much more successful and profitable business. Because when you’re in that pedal-to-the-metal mentality 24 hours a day, seven days a week, we end up doing the same thing that I did, that we talked about at the beginning of this call, which is making short-term decisions instead of investing for long-term wins. And we don’t do the necessary work of building teams, or peeling back the layers of the onion, or serving our customers. And if we can be easier on ourselves, especially on the short-term results that we’re creating, we end up making much more beneficial decisions for our customers, for our families, and for ourselves, as we build a business that we’re really excited about.

That’s what we’re in this game for. We didn’t come into this game in order to be mimicking everyone else and copying their sales strategies. We got into this game because we wanted an exciting life that was full of freedom, full of fun, full of growth, and business is just one of those routes. So, just be easier on yourself.

Kurt Elster: That is genuinely good advice. I went to a therapist for some time, and one of the most powerful things she ever said to me was, “Kurt, you’re too hard on yourself.” So, if you want to save yourself quite a bit of money on therapy, just take that away from this.

Ryan Moran: I wish more entrepreneurs were open about… I do therapy regularly. I have for years. I wish more entrepreneurs were open about the journey that goes on between our ears, because most of us feel like we’re fighting this battle alone. It’s what being an entrepreneur is. We take a risk, we succeed on our own merits, and that’s beautiful. And then all of the chaos and noise that happens as a result of going through that process is something that we often struggle alone with. And I wish we were more open about that. So, thank you for bringing that up, Kurt.

Kurt Elster: This is a great interview. All right. We can’t do better than this. I’m gonna leave it there. Go get Ryan’s book, 12 Months to $1 Million. It is available today, May 5th. Godspeed. Best of luck. Ryan, thank you.

Ryan Moran: Thanks so much for having me, guys. Appreciate it.