Stepping inside the Mind of Alex Hormozi's 2nd in Command w/ Tim Calise

Ever wonder how one transitions from a late-night snack delivery service in college to the executive team of a thriving business? Join us as we explore the entrepreneurial journey of Tim Khaleesi, who accomplished just that. Learn how he turned a simple idea to fulfill a need in his college town into a stepping stone that led him to Gym Launch, working alongside business giants Alex and Layla Hormozzi. Tim's unique insights from his experiences offer valuable lessons for business owners at any stage.

Tim takes us through his experience of building a small fund in the unpredictable world of hedge funds. He shares the importance of trust-building with investors and the role their unique selling proposition played in this process. Hear about the path trap of traditional careers and the challenges he faced in deviating from it. Take a deep dive into the intricacies of investment decisions and how an enormous challenge back in 2007 eventually led to an exciting venture in fitness tech. 

In the final segment of our enlightening conversation, Tim reveals the secret to building strong relationships with customers – it's all about selling benefits over features. If you're looking to build an independent business that isn't linked to the world outside, Tim's insights are gold. He offers practical steps towards financial freedom and shares a free paid strategy on his Instagram to help make businesses more profitable and consistent. Join us, and let's learn together from Tim's inspiring journey.

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Transcript

Speaker 1: 0:00

was about 25. We raised over $325 million for that fund and how to heck with time doing it. But that put us right around like late 2007 and we proactively gave back all $325 million at Harvard Capital. But then took my ball and went into the fitness and technology area for about a decade, which very fortuitously allowed me to be introduced to Alex and Layla Hormozzi and ended up being joining him and Layla on the executive team at Gym Launch.

Speaker 2: 0:30

Welcome to the Financial Freedom Fast Podcast, the show that teaches you how to buy back your time and live life on your terms. Learn how to confidently leave your nine to five from guests who've done it themselves. Whether you want to lay on a beach, travel the world or focus on your passions, this show will give you the tools to do what you want when you want. Now here's your host, matt Ammabeal.

Speaker 3: 1:03

What is up? Financial Freedom Fast fam? Today I've got on Tim Khaleesi. It is an amazing, amazing podcast. This guy is Alex Hormozzi's second hand man in the Gym Launch business. So cool to learn from someone who works so close with Alex and Layla Hormozzi being the second in command. And now what Tim does is basically what Alex does with $10 million businesses. But Tim manages businesses between $500,000 and $3 million in revenue per year and increases those revenues exponentially by using a few key things. I'm not going to give them up now, but a few key things that he targets in on to expand and increase that business's revenue. Such a great podcast today, so excited for you all to jump in. So, without further ado, let's jump into the podcast, tim Khaleesi. Welcome to the Financial Freedom Fast podcast, my man. What is going on, dude?

Speaker 1: 2:15

Man, thank you for having me. I am super excited to be here and then looking forward to the conversation, so very much appreciate it.

Speaker 3: 2:22

Yeah, man, really excited on my end as well. We were actually like literally just saying this 20 seconds ago, but this is our first conversation. A lot of the guests that I bring on this podcast I've already talked to in the past, so this is cool that we get to do this organic, almost like an introduction combo, meeting each other and really dig it into what you do, who you are, where you bring value and how other people can learn from you. I am super excited to dig in. So, tim, for those who don't know you, why don't we just go into a little bit about who you are, what you do and what you've done in the past?

Speaker 1: 3:04

Yeah. So a quick intro I grew up in the North Shore of Long Island escaped without the accent, but very much in Northeast. Guy Was that kid in middle school who brought a briefcase to school, both to just completely embarrassed by sisters, but probably because I didn't know anything else. So suffice to say I wasn't the coolest kid in middle school. But by the time I got to college I started my first company, which was a late night snack delivery business. So as a hungry, wanting college student in Washington DC, there just wasn't anything there that allowed us to get cookies and cupcakes, cakes and ice cream and all that kind of stuff late at night. And so we saw a need and started a late night snack delivery business in the DC area.

Speaker 1: 3:49

Always knew that I liked business, I liked money, I liked finance, I liked the whole the game from a very early on, early stage. But I knew I wanted to do it my own way and that led me to joining a small investment management company in the Southeast out of college and over the course of three and a half years until I was about 25, we raised over $325 million for that fund and had a heck of a time. A lot of fun doing it. But that put us right around late 2007, and, as anyone who was around in 2008,. The story ended very bleakly for many, but for us we proactively gave back all $325 million of hard capital, and so that kind of still lives with me today.

Speaker 1: 4:33

But then took my ball and went into the fitness and technology area for about a decade, which very fortuitously allowed me to be introduced to Alex and Layla Hormozzi over at GymLaunch, and Alex and I did a little bit of business together before he encouraged me to sell my gyms and find a better V value vehicle, which ended up being joining him and Layla on the executive team at GymLaunch, which is a set of companies that we ended up being sold a couple of years ago. And now I am packaging up the last kind of two decades of blood, sweat, tears, scars, learnings, all of those types of things to help service business owners, specifically folks that are due, kind of relationship based business membership, subscriptions, engagements, that kind of stuff really, to avoid all the foreseeable mistakes and hopefully shorten the learning curve, to stack the deck in their favor. So that is what I do. I love the game, I love the passion of entrepreneurs and I'm very fortunate, very fortunate to be able to do it day in and day out, man amazing, amazing, your entire life story within 20 seconds.

Speaker 3: 5:40

There from college to this period. It seems like it was a quick ride, but man, there is so much experience in there like learning and working side by side without. But I want to dig. That's like kind of the more recent stuff. I want to go back to that first college business, like why this late night snack? Right, we all get there. We're hungry in the middle of the night, can't get the food, can't get the snacks, no convenience stores open. You don't want to drive there anyway. So let me get something. What were you thinking as this kid Like how did you create that? How did you know that you were going to dive in on this opportunity and actually make it happen? And what were you thinking there? What did that process look like for you?

Speaker 1: 6:23

Yeah. So I've always been an action taker and I think from as early as I can remember. I never saw a problem that I didn't think I could solve. And, of course, in the early days you think you could do everything. But I started to learn what the thought cycle needed to be to take an idea and actually make something happen.

Speaker 1: 6:41

And so with that one, it was literally like a Wednesday evening, and this was down by the White House in DC, where 7-Eleven was the only option around, and we were just getting started. You know, as college kids, we were just going out at 8, 9, 10 o'clock at night. We were our target customer and so we said, heck, if anybody else is going to do it, we'll do it ourselves. And I think the critical thing that we did, which allowed us to be successful, was by the time we came up with the idea. It took us 24 hours to implement, and I think that took us because it was literally like hey, we have nothing else to do.

Speaker 1: 7:14

We like the idea, let's put a website up. We'll call a bunch of our friends and say, hey, if we have this delivery business, would you order? And what kind of things would you want to order. The next day we went to BJs and bought a bunch of cookies and ice cream and stuff like that, and by the weekend we were in business, and so I think it proved to me or validated the idea of so often we get stuck in the. I got to do this perfectly and buy the business cards and get the URL and do all this stuff. It was like speed to money and I think that has been something that has treated me very well throughout the rest of my career.

Speaker 3: 7:49

Yeah, and I know that one of the big lessons that you took from working with Alex was that the speed like testing out, almost like the four minute mile I've heard you mention in the past is we may think we could do it that only that fast and nobody can do it faster, but everybody can always beat a record. So how quick can we do this? I love that you saw that experience of being able to build this thing. You had the idea, you built the thing and you built the thing quick and you were able to implement it and have it actually work. Where did that business end up going? Did it just fizzle out? Did you sell it? Did it like what did? What happened with that?

Speaker 1: 8:28

Yeah. So I had a partner in that business and then we ended up splitting up, to be honest, and it was one of my kind of early lessons in when you don't have a line to address and things like that and so I was on the short end of that stick, which is fine. But the business continued on and ended up becoming a seven day a week, a fairly substantial business for a period of time. But I take a lot of pride in the fact that we made the cover. We were in the New York Times for the idea and it was replicated in a bunch of other college campuses thereafter.

Speaker 1: 8:58

But it's one of those things that I think the reason why the speed happened and that is something that's carried with me is I've always separated myself, like my identity, from the identity of the business, and so often it's. If I have this idea and I bring it to market and everyone hates it, then it's a reflection of me. But the more you can distance yourself and just say I know that it's going to take 100, 500, 1000 iterations to get to something good, then it's just how many times, how many? How quickly can I go through those that learning curve and it becomes less about you and more about. As the famous kind of quote says, I need 50 nodes to get to the yes, so how quickly can I get a no? It empowers you, rather than when you put all your chips in this one basket and if people don't like it, they take it personally.

Speaker 3: 9:47

And hell. You tested it out, man, and it's not you right. A business is its own entity. It's something you're creating, it's an idea. You have that turned into something and you know what. There's probably a million people out there that think it's stupid, but there's probably a million people out there that think it's awesome. And if you have the opportunity to get that out there and to show everybody what was the name of that company Because I had one of these in my college I'm trying to think of the name of it myself, but I had one at Rutgers University when I went what is it called?

Speaker 1: 10:19

Yeah, so ours was called CampusSnackscom, but we bred a bunch of imitators who took the idea and packaged it under different names. But yeah, campussnackscom. We were in our college newspaper dated before most of the others, if not all the others, and then we were in the New York Times as well in 1000.

Speaker 3: 10:38

Man so cool and such a good experience to have early on, and it's catapulted you into a bunch of different other experiences in your life. So then we go to this point. You're 24 years old, you're out of school or maybe 23 when you join this investment management firm and you raised up $325 million, and at that point you're only like 24 years old. What did it take? There's a lot of listeners out here like on this podcast doing real estate, starting businesses, doing first round funds, whatever they're trying to do, we all need money to make things happen. What were some of the big takeaways that you had with being able to raise capital on actually like $325 million? That's a big amount. So what were your takeaways from that experience?

Speaker 1: 11:26

Yeah. So I think at the time my age, when I was calling on these investors, I don't think anybody had any idea how old I was, so I think I was just naive to think that I couldn't do it. So we didn't have any reason we couldn't, so we just did. But the two big takeaways I would share are the first is we, as a small fund, had to figure out what our unique selling proposition was, and at that time, just for context, this was like the wild west. Hedge funds were the thing. It was the hot ghost story of the day.

Speaker 1: 11:57

And kind of hedge fund managers were these like really big headed people, and it was the tone of the conversations with investors was like I'm a manager, you should be lucky to invest with me, and I always thought that was backwards, being new to the industry. I'm like aren't you asking for money? It seemed very strange to me and so we basically went out on two things. We said we're small so we could be nimble. And number two is the people that we're getting the investments from was primarily like their IRAs and things like that retirement assets. And so I simply went out and said two things. One, I sincerely appreciate the confidence you're putting in us. I don't take that for granted. And number two, you will never have to worry about not getting ahold of me or that your money is safe at night. And those two things alone led me into the second learning, which is when you're small, you take what you can get. So like $100,000 at a time, $250,000 at a time, $50,000 at a time.

Speaker 1: 12:56

And in the beginning I underappreciated the kind of quadratic, the nonlinear growth pattern, like the idea of compounding, because in the beginning it was part. It was like I'm doing all this work and we'll get a little bit of money here and a little money there. But once you start, we started with about a million dollars under management. Once we got to five, it got a little easier.

Speaker 1: 13:16

Once we got to 10, now we could take a half a million at a time. Once we got to 50, we could take a million or five million at a time, et cetera, et cetera. And so it took three quarters of that time to go from zero to 50 million. And it took a quarter of the time to go from 50 to 325. And I mentioned that simply because so often we try to skip steps, because we either get impatient or we see somebody else doing something, or we think we got to get the big number notch the small wins. And they really do. They do build on themselves and that was the lesson that we learned with a unique like I said, with a unique position.

Speaker 3: 13:51

Yeah, and you learn the actual inner details behind it when you're dealing with customers and I know myself from raising money for my own deals when they're bringing there's a difference between someone bringing $5,000 and bringing $50,000. And then there's a difference between your customer that's going to bring $50,000 and the customer that's going to bring $500,000. And I believe, as you go up, the more intelligent investor, the more sophisticated investor that you're dealing with. It's almost like if they see an investment that makes sense to them, they know how to underwrite it themselves and dig in. If you are presenting it properly to them, they will know without a doubt if or if not they want to invest with you, whereas the $5,000 investor might be their hesitant. In one day they're out one day. And it's man, I'm just doing so much to pull this and you learn those things that you have to learn to be able to bring that money in. And it, just like you said, it compounds. You went from zero to 50 mil and it took 75% of the time and then you basically like quadruple you got six times that within the amount of time that it took you to raise the original 50. Man, big lessons there. I really love that.

Speaker 3: 15:10

And one thing that I've heard out of your story when you were at this firm was when you had your banking job. Right, you mentioned this path that everyone like goes on and you didn't see that path for yourself. I know I'm backtracking a little bit here and I wanted to make sure I hit this on the podcast. Can you explain this path trap, because I think there's so many of us I'm 26 years old. I think there's a lot of us right now, at least in my generation, that are starting to work our way out of this path trap and see it as a trap, but I think there's still a lot of this out there. You go to the job, you stay here for 20, 30 years, you do this and you get the 401K, all that. Explain that path, explain how and when you saw it. And then how was it hard to take the jump out or what did that look like for you?

Speaker 1: 16:05

Yeah. So the environment that I grew up in and I own part of this and part of it's just my perspective which is the folks I was surrounded with were doctors and lawyers and bankers and that kind of stuff and so really successful people. But my takeaway or my perspective on it at the time was I felt like I was being compared to the other people in my class who had these aspirations to be a doctor or lawyer or a bank or all that kind of stuff. And my takeaway of all of that was there is a way that this is supposed to work. Like life is, I'm at this step and then I go to college and then you go to business school and then you go work at a bank and 50 years later maybe you pick your head up in retirement with some money to show for it. And so I just had this nagging feeling of like when you're playing like a video game, I'm a car guy. It's like they show the racing line like this is the line you're supposed to follow. I just always felt like there was this hidden path. I was supposed to this line that I was supposed to walk and that deviating from it was frowned upon, mostly because I just think it would be that you become the black sheep.

Speaker 1: 17:12

And so I went through, you know, elementary, middle, high school, went to college, did the economics, finance, focus, all that kind of stuff, and I ended up at a Blakeridge firm, like a group division there, and it took me about six months and I just felt like I was like dying a slow death. And the trigger point for me was I had to come to the point of do you commit into their business development track effectively? And you have to commit for a period of time because you're like you're going to make no money in the beginning, you're eating what you killed all nine yards and I'm like do I want to do this for another five to 10 years? And I just had the sinking feeling. I was like this is just not for me. And so I had to go this line of I'm going to throw this seemingly low risk opportunity that not everybody got. I was in one of these big banks and I was like I'm going to walk away from that and go move to Birmingham, alabama, in my early 20s with a college degree that I just finished. On the hopes that I was like it sounds nuts right now, but it was one of those. That was the lower risk decision for me, right, and I think so often we look at when we are uncertain.

Speaker 1: 18:22

We look for patterns or guidance from others, and if I was to have to do it all over again, I would have spent a ton more time understanding the real estate between my ears than anything else, because that is everything else that I've ever done is some byproduct of either I should have done something differently, I would have done it differently, and the awareness early on of it's okay to do your own thing and if it works, congratulations. If you failed, who cares, because you did it yourself. The success of someone else's game doesn't feel the way you think it wants. It's going to, and I've heard that so often.

Speaker 3: 18:58

And all the social media. These days you can see everyone's path. I can see Alex Hermozzi's path and that might make me think man, I got to go acquire businesses or start a gym or whatever I need. Or I see Brandon Turner on man, I need to go buy real estate. I need to do this and it's what is what actually pulls you, what excites you, what brings your heart in, what could you wake up every single day and be like man. I am amped up right now to go do this and I think that's what you need to do. You got to live by your truth. You have to have the means and the ability to a little bit of risk tolerance if you're quite in your job like that. But, like you said, like you move out to Birmingham, that was like the safest and least risky thing you could do, because you might be risking your finances or the safety, the comfort, but what you're not risking is yourself and your own peace of mind and your ability to go in. Man, that's exciting, that is a great time.

Speaker 3: 20:06

So we've talked a lot about the beginning of your story here and going through college. You had the college business. We moved into this banking area. Then, when investment management you raised up all this money, you lost all the money. Let me hear about that before I dive into the tech company. You started after that losing that money in 2007. As I imagine, your stomach just like fell all the way through the floor Like what happened there. What were you feeling, what were you thinking and what were you imagining your life was going to look like after that?

Speaker 1: 20:41

Yeah. So we voluntarily gave it back. So that was. We did have control over the process, but just for those that are unfamiliar with how that world works, we got paid a percentage of all the money that we invested. So we had $325 million which we could invest up to about a billion dollars in capital, and we made a couple of percentage points on that every year, so it doesn't take too much to. We're talking millions of dollars in fees just to show up for work and we what we realized.

Speaker 1: 21:09

So this was 2007. We had a strategy that was that worked in what I'm going to call normal market climates, where stocks go up and stocks go down to that kind of stuff. In 2007, everything was going up. Interest rates were basically zero for those in the real estate mortgage industry. Rates were zero. Altay defaults were just starting.

Speaker 1: 21:27

That spring was when Ben Perna he said the Altay defaults in Florida and other places are going to be contained. There was no chance of that, and so we just saw that the world was going to have to go through this kind of reset and for us to continue to do what we were we had done in the past would have required us to take on more risk. We would have to change our stripes and the decision before the big decision of returning the money was do we change our strategy? And there was a lot of conversation around that and talk about risk. It would have been like how confident do we feel that this is going to work? And we came to the decision that, like we're throwing all the money into a pit and hopefully it works. And so we said we went to all of our investors and said everything we're seeing, we gave them the data, we gave them our perspective and we said this is going to end badly. We don't know when, but we're going to go to cash. So we're going to pull all of our investments, but we're not. And we're going to keep your money, but we will charge you zero dollars in fees. The only thing we ask is that we allow that, you allow us to reinvest your money when we feel it's appropriate, so that we didn't have to like go, why get it? And having people wire back in just to be able to buy stuff.

Speaker 1: 22:37

And almost exclusively, they say our investors said you guys have lost your touch. Everybody else is saying this looks fine. If you can't adapt to the market, then maybe you're not as smart as we thought you were, and they took their money and that was effectively how it worked and we were early by about eight, nine months, but proven correct ultimately, and so it was a painful point for me in my mid twenties. This was like my wealth building engine at the time and we literally walked away from the golden goose, and so that was. It was incredibly painful. It was the right thing to do, but it spoke to. Maybe sometimes in life you just got to stick to your knitting and stick to it, stick to your lane, and when circumstances tell you to get out of it. It would probably been much more painful. It was a less well-earned.

Speaker 3: 23:24

Yeah, I imagine if you stayed in if anybody knows anything about 2008 timeline I imagine if you stayed in, things could have gotten a little bumpy those next nine months and when you feel it in your gut, especially when you're dealing with other people's money. One other thing I've heard you say in the past is that you treat other people's money like it is your own money. That is money that I look like that is in my account. Me personally as well. I'm like man. That money is actually even more important to me than my own money. I need to make sure I'm going to get this money back to these people, and so what I had thought about your story is that you lost all that money.

Speaker 3: 24:08

So this is a much more noble, courageous, honoris like story about seeing the risk that is coming, seeing what's coming down the line and saying, listen, we don't think it's safe to get your money out there. You gave them the option. You said, hey, can we keep it here and then, when we see a good opportunity, we'll go at it. They didn't give you the shot to do that, but you know what that path led you into your next venture right, which is starting this gym tech, fitness tech and tech company. So let's dive into that period of life, what that looked like and what the main lessons were. That was a while that you were doing that, correct?

Speaker 1: 24:47

Yeah. So after we wound the fund down, we moved back to the Northeast and there weren't really any kind of companies like ours and I didn't want to be in that business anymore because I knew it was coming. So my wife and I met. We were division one athletes, we were rowers in college in DC, and so fitness and health was always important to us. And my wife one night was Googling personal training in the town that we ended up moving to and there was this headline that said some version of automated prescriptive strength training or something like that, 24-7. I was like that's interesting, like I'm going to a free trial or whatever. I'll go check it out.

Speaker 1: 25:22

And I walked in. It was a physical, like brick and mortar location and it had these new machines. I had never seen it Basically look like an old, like universal machine, like you see in, like it does on a million different exercises, but with sensors on it and a screen on the front. It's like this is really neat. And so they walked me over and they plugged in like a USB thumb drive and it said good morning, tim. Today, these, today year, we're going to do these six exercises. It chose them for me. It told me what weight to lift. It told me the pace to lift and lower the weight. It took all the guesswork out of strength training and also good and slick like 24 sevens. This is pretty neat and more importantly was, I looked around and there was the starting center for the high school football team on one of these machines and four feet next to him was this probably 65, seven year old woman, same machine, unique experience. I was like, right, that's neat.

Speaker 1: 26:17

So I called the CEO of the company and I said are you taking investors? Because I think this has got an interesting angle to it. He said, thanks, but no thanks. But we're starting a franchise. Any interest in being a developer? I'm like, all right, I'm entrepreneurial, I can figure this out. And so, 2010, we opened our first location and we grew to eight locations and it was a multi seven figure a year business and one all said and done. But it was a great. It scratched the itch of my entrepreneurial needs. I love tech and probably more importantly in the long term story, it was away from. It was the way that I was introduced to Jim launch back in 2018, 2019.

Speaker 3: 26:53

And that is that's in. Even it seems like your life is just leading up. One thing leads to the next big thing leads to the next, leads to the next, and that's realistically how all of life goes, as long as we continue to grow and continue to move in the direction that we want to go. So, jim, launch let's talk about that. What was that experience like? Working closely with Alex, working with Leila and and being like their number two in the ring in the gym launch team.

Speaker 1: 27:24

Yeah, so I owning our gyms, I was introduced to them through we want a sales contest for prestige labs, which was the supplement brand associated with with Jim launch. And so we want to trip down to meet Alex and Leila, and so sitting literally at their dining table in their house, it's me and I think 11 other Jim owners and Alex is like all right, let's, we'll do a little like mini strategy consultation kind of thing, and everyone's like how do I get more members, how do I do better programming, how do I keep them longer, all that kind of stuff. And I was sat here and like I am just not long for this world. I this just doesn't. I don't just doesn't get me excited, because I wasn't Jim guy in the traditional sense. I like the tech and I wanted to build a business that had impact, and so it got to me.

Speaker 1: 28:07

And after a short discussion, alex was like you are in the wrong opportunity vehicle. You should sell your gyms. Okay, so when I'm basically sold my gyms, I actually sold them off to my key employees and not three months later he and I reconnected and he's what do you up to these days? He asked me a couple of questions, I helped him out on something and he said I'm building out the team here because we're taking off and getting some traction with Jim launch. Do you want to come on board as VP of business development? And I think 30 days later I was on the team and six months later I was relocating my family from the Northeast down to Austin.

Speaker 3: 28:45

Man that is. That's a big story. What are some of the big takeaways and best experience, most memorable experiences that you had during your time at Jim launch and working with Alex?

Speaker 1: 28:57

Yeah, obviously everybody knows who Alex is or most folks do these days. I will forever appreciate the times where he and Layla are standing in my kitchen like talking to my kids. I had pictures of these like us hanging out in the driveway so we got to know them as people, which was just a phenomenal point of my life Because it'd be like knowing like Elon Musk before he became that kind of analogy. Working alongside him was unlike any. He is the smartest guy I've ever met, most driven guy I've ever met, and for all of his public persona and everything's achieved, I will be forever indebted to him for kind of the lessons that I learned he has been able to.

Speaker 1: 29:41

He synthesizes information unlike anyone I've ever seen. So he can speak to a gym owner, he can speak to a private equity executive, he can speak to camera. He's remarkable in how he's able to take all of the information in and see the path forward on how to sell it, how to package it, all that kind of stuff. So I got the equivalent of probably two or three MBAs in two and a half years just being in the trenches with him. So I appreciate the time there and it has taught me quite a lot and a lot of the principles that I even take with me today in building new businesses and other areas.

Speaker 3: 30:14

And so that kind of leads us into where you're at nowadays right, like you're doing this business type consulting whereas Alex typically focuses on I think he's is it 10 mil plus revenue per year, 10 million or more, and you're typically between 500,000 to 4 million 5 million range, and you're doing the same thing that he's doing with those guys, what you're doing with these guys. You're doing 500k but you want to be doing 5 million. How can we do that? What do we need to do? So what are some of the main points that you typically see businesses get caught up on and where can they add the most value to their businesses?

Speaker 1: 30:53

Yeah, yeah. So Alex and Layla if, for everyone who's listening to their stuff, layla is unbelievable with people systems. She is unparalleled of anyone I've ever met on how to attract talent, find the right talent, curate the right talent, all that kind of stuff. Alex is a phenomenal sales and marketing guy. The reason why that worked well is the 10 million plus realized wholly on those two things. In my opinion, from zero or 500k up to about 3, 4, 5 million, definitely up to about 3 million.

Speaker 1: 31:23

It's all about Prada, and the thing that I have always loved and had a passion for is I have a 10 year old son now. It's like looking at a business like a stack of Legos what are the pieces that we have to work with, what pieces do we need to get and what can we build out of them. And I think, fundamentally in that earlier part of the life cycle where the kind of revenue cycle it's all about putting the right product on the field because it achieves so many of the objectives that we need to do to get stability and growth and scale and things like that Pricing, positioning, all of those types of things standing out in the marketplace all of those are all product driven. So I work with service-based business owners anyone with recurring revenue up to about 5 million a year in revenue to use product to create a category of one. How do we stand out and just be able to cash for the business so that we can get to 10 billion and beyond?

Speaker 3: 32:18

What types of companies typically are you working with? Is it all over? Is it specific niche?

Speaker 1: 32:25

Yeah. So I have a real estate tech company that's building some incredible software for the real estate industry and real estate agents, et cetera. I have a non-medical home care business which is already doing 2 million a year. We'll probably take that business to 4 or 5 million in the next 12 to 18 months. I have a podcast related technology and software business. That is in the kind of promotion and distribution space. So I've got those are the kind of the breath and a lot of things in between.

Speaker 1: 32:52

But my core belief is the recurring revenue component is the key, especially now when you can create a relationship with a core customer that you can help deliver value for. It's simply a question of how many different ways can we take that relationship and layer on additional value. So in the gym space it was not just workouts, it was nutrition, guidance and accountability, coaching and all of those things. It sounds simple now, but before gym launch even existed, most gyms were not doing that. They were doing free trials into workouts. We pioneered the six-week $600 challenge, which allowed us to then layer in those other pieces, and it has fundamentally changed how independent gym owners work. So I'm looking to do that in other areas as well.

Speaker 3: 33:35

Yeah, that's amazing, using those same core concepts and bringing that to the table and it makes sense, right? Like the gym goer, let's say the main problem that a lot of people have is they don't and I'm a gym every day type of guy but you go to the gym, you work out, it gets done. If you go to the gym, it's not like you're not going to work out, you're not just going to sit there and talk to people. You could, but a lot of people you get. The hardest part is getting there. So what is going to get you there? It's almost like you were like man. What is that main problem? It's because people aren't going. They can't get themselves there.

Speaker 3: 34:07

The accountability is what they needed and that was like and now it's you've got that customer locked in for life, because where else are they going to go? That has these services, at least at that time. You are a unique value proposition. You are this new product that they haven't got the taste of anywhere else, and now it's getting the motivation to make them in better health, in better shape. That's amazing. I love that you're bringing that into other businesses. What are some of the best ways that someone with a small business with this product. Service-based business can build a stronger relationship with their customers.

Speaker 1: 34:43

Yeah, I see this all the time and it sounds basic, but it is misapplied in many cases. Which is selling benefits? You should be selling benefits, not features. In the fitness space, it used to look something like this I'm going to give you a free trial, welcome back, Come in, free trial, here's all the equipment. That's what it looked like. Instead, we said nobody cares about the equipment. If I said, come in and I can help you get to your goals and all you have to do is sit in a chair, people would still sign up. I'd have a line out the door.

Speaker 1: 35:16

It's not about what you think you need to do, or the classes or the equipment or whatever. It's how it is the future state of the person that they're trying to get to In our world. It was a transformation journey. Instead of saying let me show you the equipment, it was Jane, what brings you in today? Here, I want to join a gym. They don't want to join a gym. What really brought you in today? I was just walking by, jane, come on. What really brought you in today? I feel like my husband doesn't look at me the same way they did when I was 20. Oh, now we're getting somewhere, okay. So what else have you done to try to deal with this? I've gone to 17 gyms over the last 20 years, all right Average rate of, let's just say, 50 bucks a month. So you're in for about eight grand.

Speaker 3: 36:01

Hmm.

Speaker 1: 36:02

And they're like gosh, you're right. Okay, good news, I am in the business of making sure that you're going to be successful. And we trumped it. And as a gym, we ended up being in the transformation business, rather than the kind of free training, trial and choose your own adventure business. And I use that parallel because so often we think of our business as the thing that we offer right now.

Speaker 1: 36:24

These, this is the program, this is the service. Nobody cares unless that service takes them from where they are to where they want to be. So if you are in business and you're like it's just not resonating or not where I want to go, think of the person you're catering to and think of all of the different ways that they can go wrong, where the friction points or whatever, and whether you offer it or you find someone else a great kind of JV partnership opportunity make sure that you are the provider of that All of the pieces, all those stepping stones to make sure they can go from where they are to where they want to go, and that it will deepen the relationship. Like nutrition, I'm not a nutritionist, my team wasn't nutritionist. We had a nutritionist come in, so we did a joint venture. They did the nutrition consults and all of that type of stuff, and if we referred out to them for more services, great, we had a revenue share opportunity. But as far as our client knew, we were the one who was in charge of that, yeah, yeah.

Speaker 3: 37:23

That is so powerful, especially if you're not saying sales like you're trying to sell something to someone, but if you can create this journey, find out where the person actually wants to be. So if it's fitness, like I want to look good, why do you want to look good? I want to look good because my husband hasn't looked at me the same way in the past 20 years All right, what is it going to take? Where do we have to go Like? How are you going to feel when we get to that point and then you kind of work backwards from there? What do we have to do and how do we keep you getting? How do we guarantee you and let you know that we are the right solution to get you to what your future is and what you want? And that is a very powerful way to bring people in. And then comes the actual delivery and making sure that you can execute on those things and bring those promises to the table.

Speaker 3: 38:18

Tim, before I dive into my final questions here, there's one thing that you mentioned before we hopped on this podcast that I want to dive into, and you actually just gave a keynote on it yesterday, and I believe this was more real estate based how to remain competitive in unstable markets. Right now, as we do this podcast, it's October 20, 2023. And we're seeing some foreclosures. We got high interest rates, some markets are going down a lot, some markets are pretty stable, some not too much increase in everywhere. How do we remain competitive and keep making some money doing what we want to do in these types of markets?

Speaker 1: 39:04

Yeah, so the title of the keynote was become unshakable in an unstable market and I think in so many ways, the idea of business cycles, economic cycles, things like that cycles by definition is something that we are going to see over and over again and in many cases it feels like a roller coaster that we have to ride Like where are we in the cycle? Is it good, is it bad? Peak trough, all that kind of stuff. If you could build a business that had no correlation of what was happening in the outside world, do you think you would be better off? And most people would say yes. So the question is how do we do that? And the point of it was to look at the product or service that you're offering.

Speaker 1: 39:49

So take real estate as an example. What we are looking at is real estate agents are not transactional. If you think of an agent and I deal again, I've got clients in this and I deal a lot of folks in the real estate industry it's about if you look at it as a relationship rather than a transaction. The question I would ask is you have these clients, you have this database of potential relationships. What are the different ways that you can offer services or products to those folks in a way that deepens the relationship. An example I would give, and not to plug my client, but we are building a way to do scalable, consistent referrals, because referrals are great but they are high quality. They're typically inconsistent because nobody wakes up in the morning thinking I need to refer you business. So what if you could build a referral engine around you that you are in control of? Think of them like building pipelines the market's up, the market's down. If you knew that every month, like clockwork, you could get 10 referrals, do you think your business would be different?

Speaker 3: 40:52

Keep on rolling 100%.

Speaker 1: 40:54

So the question is, how do you build that engine and that framework? Not whether it's possible. I will tell you. So that's the type of stuff that we're working on. Even smaller examples are, when I bought my house, the guy who we hired a painter he's what else do you need? And he became my go-to guy and he knew everyone in town and he delivered additional value to me and he got referral fees and chore above and beyond when he put paint on the walls. I just think about most people don't want to buy a house. They want to make a change in their life and the key life events that happen that you happen to participate in. The question I would ask is how can you participate in more life events that your client might go through over the course of their life?

Speaker 3: 41:34

That's big and that opens up. Depending on what you're doing, it is a lot, man. How can you help out? Even me myself, as a real estate investor I have recently dove a bit more into this with getting involved. I've got my entire contractor team and now I've got tenants who are starting to come into now my community of houses. I'm moving tenants as tenants, families are growing and they're getting to different positions. Oh, you want a single family home? Now, all right, let's get you out of that apartment and let's move you over to my single family home over here. It's offering these different abilities. And then for the outside, for my other people that are working with me, I've got my contractor team and I'm able to offer these different services for them.

Speaker 3: 42:25

It's entirely a big business model and I'm about to buy a business actually right now, a convenience store. I'm buying the real estate and the business. That's going to be really fun to think about as I dive into that new venture. Really cool, awesome information. Tim, you are full of really really good information. I'm glad I was able to get you on here. I'm going to dive into our final questions here. Tim. What is one actionable step our listeners should take today to start on their path towards financial freedom.

Speaker 1: 43:01

Great question, something today that you can do that is actionable. Okay, two things. One, if you're in the real estate industry or the mortgage industry or anything like that. Number one is just to dovetail off of what I just said a moment ago. I came from the investment management world. Our metric was assets under management. Here's what you should do.

Speaker 1: 43:22

Take your database. Let's say you have 300 people in your database and right now you might get five or 10 transactions a year out of those 300 people. I would look at each one of those and try to understand what their assets are. Not just their name, but, like Matt, you might be on my list as one name, but he represents $10 million of property that he owns I would try to go through your entire list and understand the total of assets that you actually can influence.

Speaker 1: 43:53

The next step after that and I'm going to give you a gift at the end of this and I'll come right back to that to make that even more crystal the second one is if you're in a service business or anything like that and you do not have a VIP option, that is 10 times your average selling point. Ask yourself the question what needs to be true for someone to pay me 10 times more than they're paying me right now. Either of those cases. As a listener to the show, I want you to go to Instagram timcollease and I'm going to give you a paid strategy that people have paid a lot of money for. As a listener to the show, I'm going to give it to you for free and it walks you through how to implement both of those strategies in your business so that you can expand the revenue that you generate and make it much more consistent than it has in the past.

Speaker 3: 44:51

Absolutely Amazing. Guys, remember to go to Instagram, timcollease, and I will link to that in the show notes. I appreciate you giving that little gift out, guys. Come on, it's the Financial Freedom Fast Podcast. That's what we do here, hey, last question I got for you today, tim what is one question that you wish I would have asked, or a topic that you wish I would have covered, and how would you have answered that question or how would you have expanded on that topic?

Speaker 1: 45:22

I believe that we are only limited by our options, and our options are only limited by our imagination. I think one of the critical things that has transformed my life is I met someone who works one day a week and makes close to $3 million a year with 97% margins. He has one person on his team and until I met that person and understood how he did it, I didn't think it was possible. Now I have taken the approach in everything that I do is how can I live a life leverage? I think the more often we can look at not what is possible but what is probable and how do we get the most out of everything that we do, so you will find yourself compounding a life that you actually want.

Speaker 3: 46:15

That's pretty incredible that I might need an introduction to this man and have him on the podcast potentially, if you're open to that. That is amazing. How can you leverage what you currently have? Leverage right now it's not just about money. You can leverage all sorts of things. You can leverage your skills, you can leverage your relationships, you can leverage your position, your family position, whatever you have, there's a way to leverage it and get that and bring value to other people. Last question, and we already went over it a little bit when can my listeners and watchers find you online?

Speaker 1: 46:56

I have an inner circle that you can sign up for completely free, but I drop tons of nuggets of knowledge at timcolysecom. You can find me on Instagram, timcolyse and LinkedIn. Primarily, I do watch my own DMs. If there's anything that came up, anything you're wondering about, shoot me a DM. I will look for your audience. I will make sure that I treat them well.

Speaker 3: 47:18

Awesome Instagram, linkedin and your personal website. Make sure you get on there. We dug in so much today on so many different topics too Adding value to your business, starting businesses up, what you can do and ideas, bringing those ideas and actually making them into life. Moving quick, making things happen. I love your story. I love the action that you have taken and that has gotten you to an amazing position. Tim from the Financial Freedom Fest podcast, I am your host, matt Ammobile. Today we add on Tim Kalees and Tim. Thank you so much for coming on today, brother.

Speaker 1: 47:57

It is my pleasure. Thank you so much.

Speaker 3: 47:59

Signing off.

Speaker 2: 48:02

Thanks for listening to the Financial Freedom Fest podcast, the show that teaches you to buy back your time and live life on your terms. Be sure to subscribe to this podcast wherever you're listening, and follow us online at Matt Ammobile. That's Matt A-M-A-B-I-L-E. Be sure to tune in Monday, Wednesday and Friday for our weekly podcast drops. Thanks for listening. Let's retire together.