$1M ARR Per FTE: How to get hyper efficient

What's a great ARR per FTE, and is it even realistic to get to $1M? And if you could, why should you?

This and more we discuss in todays episode.

• (00:00) - Introduction
• (02:32) - Why $1 million, like really?
• (06:46) - The Mindset Shift
• (13:00) - What can we automate first?
• (18:31) - Average quality of talent
• (25:48) - Investing in Assets for Growth

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Creators & Guests

Host

Mikkel Plaehn

Marketing leader & b2b saas nerd

Host

Toni Hohlbein

2x exited CRO | 1x Founder | Podcast Host

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[00:00:00] Toni: Hey everyone, this is Toni Hohlbein, you are listening to the Revenue Formula with Mikkel and Toni.
[00:00:06] In today's episode, we are talking about how you can get to 1 million ARR per FTE and why you should be caring about it. Enjoy.
[00:00:16] Before we jump into the show, today's is to you by EverStage, the top sales commissions platform on G2, Gartner, Peer Insights,
[00:00:26] and Trust Radius with more 2000 reviews from customers like Diligent, Wiley,
[00:00:32] Trimble, and more.
[00:00:33] Visit everstage. com and mention Revenue Formula unlock a personalized sales compensation strategy session with one of EverStage's RevOps experts.
[00:00:45] And now, enjoy the show,
[00:00:46] Mikkel: you. No, but I mean, you've been hit pretty hard as of late. And I just love how you're completely drugged up. Like I said before we hit record, you're pulling out all the stops to make this work just for one recording.
[00:00:58] Highly, highly, highly appreciated, highly appreciated. And I think I mean, are you gonna be at your, the top of your game today? How, what efficiency level are we gonna be at in this
[00:01:07] episode?
[00:01:07] Toni: I'm always at the top of my game. And especially in comparison to you, it just makes me, you know, it accelerates me all the time. At least in the ear and the eye of the viewer, Mikkel. So don't, don't, don't worry.
[00:01:19] Mikkel: it's like that chip on the shoulder that, you know, motivation to come in and just bash your co hosts every Monday
[00:01:25] Toni: it's, it's why I like small people. When they're small, they buy very tiny dogs, you know, and then they just look so much bigger suddenly.
[00:01:33] Mikkel: I also just gotta ask, have you graduated from the ladder to have your camera on, or is it placed on something
[00:01:38] Toni: It's a, it's on the, it's on the tripod now, so kind of, we we're kind of getting there and if you guys want to check it out on YouTube, you, you will, you will see me with like, you know, fever, sweats, you know, if, if that's anything that's interesting for
[00:01:50] Mikkel: I just find our I find our rational or reasoning so logic.. It's like, You need the tripod. I have the expensive camera and is now sitting on top of basically my children's toy things, and it could fall down and break. It's like the most expensive piece of gear we have, but you know what?
[00:02:07] We'll probably get, we'll probably get
[00:02:09] a um, It's
[00:02:10] called a compromise. That's true. We'll, you know what, we'll probably just get a tripod at some point because buying all that equipment is not going to influence how much revenue per employee we're going to have. That's, that's, that's not going to, not going to change, right?
[00:02:22] So we uh, perfect segue. I even, I even got there before you. So I wonder if you are fully into this episode today, but we'll see. We'll see. Now we'll get into it.
[00:02:32] What we wanted to talk a bit about today is, 1 million ARR per FTE. It's probably one of the more catchy titles we've had as of late. But we've also seen kind of a shift happening at the moment where teams can carry higher ARR per FTE.
[00:02:47] So we wanted to spend a bit of time talking about how you can basically optimize for that number. Why should we even care about ARR per FTE?
[00:02:55] Toni: Yeah, so there's there's a couple of stats coming out just to maybe start out with a bit of a benchmarking piece, right? There's some, there's some outrageous numbers, like you have someone like Onlyfans, which is not something that everyone wants to copy, but I think they're currently at 12 million ARR per FT, which is obviously a fantastic number.
[00:03:16] Then I just saw today Doximity basically the, the LinkedIn for doctors. At 660k per FTE. And then, you know, I looked at some benchmarks from Carl Poyer and he's, he's working also across the spectrum. So, you know, startups to, to scale ups and the numbers he has there between 1 and 5 million AR, which we're not going to focus on today, but that starts around 90 to 150k.
[00:03:43] In terms of AR per FT, around the 50 million plus, it goes already up to 300K per FT, right? So we're seeing a trajectory, the bigger the organization uh, the higher uh, that ratio is. And that has obviously to do with the bigger focus on efficiency for bigger companies, right? If you're a smaller organization you're still in product market fit or scale up.
[00:04:07] You tend to care a little bit less about You know, the number of employees you hire you really think about how many can hire instead of how many should hire. And to a degree, this is, this is already the first point I think where, where many people are getting it wrong, right? Kind of, that's, that's actually kind of the, the issue.
[00:04:25] And if you were to get to 1 million ARR, kind of, why is that so desirable? Well, number one, it basically gives you complete freedom, not just as a founder, but also as a go to market team. You don't need to, it doesn't even mean that you need to be profitable by the way. We're not doing a show for people to like, hey, you should really get to EBITDA positive and so forth.
[00:04:46] It's not about that. It's really about the freedom and flexibility to choose what you want to do. And even with 1 million ARR per FTE, if you really wanted to. You could still be, you know, not profitable. You could still choose to spend a lot of money on ads that you buy or on outsourcing, you know, consultants that you kind of pay and so forth.
[00:05:07] There are many other places where you can spend money if you wanted to, but really kind of this, this idea of a small, hyper efficient core team that has an auxiliary services around it as a company. We found this pretty compelling and I think that is, that is kind of a 1 million ARR milestone.
[00:05:26] Mikkel: So what you're saying is it's not equal to, for example, underspending, which could be for some people they go like, oh, you're doing a million AR per FTE, you might be completely squandering or sleeping on this opportunity you have. That's, that's not necessarily the case. And I think you and I also talked a bit about, okay, so what does it actually matter and put up this scenario like, well, if you are in a competitive landscape and you have twice the AR per a RR per FTE, you are just way more efficient.
[00:05:54] at acquiring and retaining and expanding AR, which is a massive competitive advantage. We've talked about it from the vantage point of CAC Payback, I think to say, hey, if your CAC Payback is better, you know, great. Or if you can afford a higher CAC, great. This is just one other element where it's a massive competitive advantage to be so efficient as well.
[00:06:14] I think the other thing also is when you go from, let's just say 300k, that's awesome. A great place to be probably. A million is quite the leap. And I think it's very intentional because it forces you also to really rethink how would you do it if, if you and I were going to walk 10 kilometers. Versus a hundred K very different approach.
[00:06:35] And I think it's the same here. If you, if you want to get hyper efficient, you need to radically also rethink a couple of things. So why don't we why don't we hop into how to start getting there?
[00:06:46] Toni: So I think the first thing that needs to happen is you know, I would call it a mindset shift. Need to change your way of. How you currently believe how you need to build a company, how you need to build a go to market team. And as a, as a good example, let's start at the, let's start at the negative.
[00:07:03] You know, what shouldn't you be doing in order to get to the 1 million? So what you shouldn't be doing is to think about cutting costs.
[00:07:10] Mikkel: Yeah.
[00:07:11] Toni: Very, very counterintuitive. If, and I have the most respect for CFOs, I think kind of, they have in the last couple of years been growing and growing in importance in those organizations, but also in their understanding of go to market.
[00:07:24] So I kind of honestly need to hand it to them. But if only a CFO is leading this approach and going around it with a red pen and kind of, you know, striking things out. This is not going to get you to a million AR. This is going to get you to a stalled company, right? So that's why it doesn't make sense to try and cut your, cut your way into like a 1 million per employee milestone.
[00:07:46] And the, you know, one example or a couple of examples where we've seen something like this is actually in the meltdown after 2021. So when we saw that the markets are coming down, suddenly funding wasn't so easy anymore. We saw a lot of cost cutting, um, you know, missions that those CFOs were on.
[00:08:04] And they, you know, rightly so were on those missions, by the way. And they did, you know, largely did a fantastic job, but what they, almost all of them did is they didn't cut costs in a strategic way. They, they created a, across the board, every team needs to give 20, 30, 40 percent of their cost away. And that's just what it is.
[00:08:24] Instead of looking at the company that they have. And doing what Dave Kellogg calls a, I think the garage, the, the, the parking lot test or something like
[00:08:33] this. So basically, you know, Dave Kellogg was like, okay, everyone on the company is fired. Everyone goes now to the parking lot. And then we decide who can come back in, right?
[00:08:44] And it's, you know, and what this then creates is not this, okay, everyone gives 20 or 30 percent. It's like, okay, which of the folks that are kind of out there, which of the initiatives we're doing, which of the channels we're working on, which of the teams that we're kind of doing the best. Should come back first, and who should come back later, right?
[00:09:03] It's a much better way to go about it, and what's gonna happen if you do it like this, you're gonna be able to balance out you know, the winners and the losers in your portfolio. And I mean this in terms of channels, not in terms of people, right? And that kind of strategic approach didn't happen. And this is one of the examples I think why, you know, seeing this as a cost cutting thing, it's I think is a fairly, is a wrong way to go about it.
[00:09:27] It simply won't get you to the one million.
[00:09:30] Mikkel: No, also because if you're a 10 million, it's like, oh, we have, we've invited nine people in from the parking lot now. So we have one person left. It's like the cost is also going to be a little bit different. Right. And I agree. It's also what we heard Chris Walker talk a bit about. You and I have talked about it while this cost cutting was happening, that because of all the internal politics, what ends up happening is it's like an even split.
[00:09:50] Like we need to downsize by X percent. So you need to downsize by X. You need to downsize by X. You need to do it as well. There's no thought going into, well, if we, if we do that, what's the ramification going to be on newbies acquisition and all retention or expansion that's not been factored into
[00:10:06] it.
[00:10:06] Toni: No, it smells a little bit like you know, I, I don't listen so much to Jeff Bezos, but he recently did an interview, which I found, and I think it was with Lex, the, what is his name? Kind of the, the podcaster.
[00:10:18] Mikkel: Lex Luthor. No, I don't know.
[00:10:21] Toni: Not Joe Rogan, the, the other big guy in the industry. And um, he, he basically kind of on the show, we talked about decision making, which I thought was really, really cool.
[00:10:32] And he talked about how he does, sorry. He talked about how compromising is not a good way to make a decision actually, because, you know, if you're sitting in a room and you ask, like, how, how high is the ceiling? And someone says, you know, three meters and someone else says two meters, the compromise would say like, well, then let's call it two and a half.
[00:10:50] But no, you can actually measure how, how tall the ceiling is and you can actually figure this out, right? So kind of, getting to a compromise here very rarely is, is the right decision. And I feel like when someone is doing cost cutting 20 percent everyone, 30 percent everyone, it feels like exactly that.
[00:11:05] It feels like the CFO walks in and says like, Hey, we need to cut costs by 20%. And instead of saying, well, you need to cut 50 percent and you need to cut 10%, and then both of the VPs are like, Fighting is like, you know what? Actually, let's leave the fighting behind. Let's do everyone 20%, right? And then, and I think that's just the wrong way to go about it.
[00:11:25] And again, that's not going to lead you to the 1 million. So what is going to lead you to 1 million? So number one, I think unless you're bootstrapped, it's going to be very difficult to hit this milestone in the first place. 10 million of your company, it's, it's just going to be very difficult. Like, I just kind of agree on that.
[00:11:44] I think there will be some outlier companies. At least that's kind of the, you know, the new, the new myth on, on LinkedIn. There's going to be a up until yesterday, there was this, Hey, there's going to be a one person, 1 billion company. And then yesterday I read there's going to be a zero person, 1 billion company because all of it's going to be AI.
[00:12:04] Mikkel: Yeah.
[00:12:05] Yeah.
[00:12:05] Toni: Okay, gotcha, yeah, yeah, gotcha. Okay. So, so there, there might be this kind of breach, sure, maybe. But otherwise in the first 10 minutes, I think it's, it's kind of difficult to get to this point. But in general, I think what you need to is you need to kind of think about it as a mindset shift.
[00:12:20] Um, And again, kind of reaching the smart zone. It's not a one day to the next kind of thing. I think it's a, it's a slow moving target. But it needs to start with a mindset shift on how you approach. Hiring people,
[00:12:34] actually. And, and the number one thing is once you kind of grown up, maybe you're 20 million, 30 million in many cases, you might have a hundred people, 150 people or something like this at this point.
[00:12:45] And, and it's so ingrained in everyone in the organization that, well, the solution to every problem is I need to hire more and everything I need to achieve in next year's budget rounds is, you know, more people for me so I can hire more.
[00:12:58] Mikkel: yeah,
[00:13:00] Toni: And I'm not talking about this as like, a budget game that someone is playing.
[00:13:04] I'm really saying this as a mindset shift and like, what can we automate first before we have to hire people? Hiring people should be the last resort that you kind of do, right? It's, it should be makes total sense for me now on the SDR role, like. You know, I would probably go for like an, a go to market engineer or RevOps kind of person that is really only dialed into this one problem and, and uses some of those AI, SDR solutions, maybe in a, in a, in a smarter way.
[00:13:37] And does outbound there, do you need 10 SDRs or do you need this one guy? And I think it could be just this one guy, by the way, right? And I don't want to get stuck in an AISDR discussion, but, but that's just an example. And then you have the other stuff that's happening on the developer side, like coding stuff, right?
[00:13:54] We're seeing companies like Cursor, GitHub Copilot was kind of around for a while. We're seeing things like Poolside, I think is the newest one that is basically kind of writing code for you. And I looked over the shoulder of our developer the other day and He was just, you know, into his like interface, I don't know, it looks all so foreign to me.
[00:14:14] He was just writing you know, create a button that links to whatever, blah, blah, blah, blah. And then, you know, I could have written this, this was like totally clear to me, he'd enter, then he refreshed the, the page and. And then it was there, it was just there, you know, and, and it took him basically 10 seconds or something like this.
[00:14:31] It's insane. So those are just examples of where I believe a lot of automation can actually come from. So meeting all of these things in our new mindset have to be exhausted before we hire someone else. I don't know if you have an
[00:14:48] example.
[00:14:48] Mikkel: know, I think it's also like you, when you go to the, through the hiring process, you will also ask the question, this role I'm thinking of, can it bring in a million in AR, can it create a million or help us service a million or retain a million or whatever it is. You will have that mindset.
[00:15:05] Versus, think about the time we've come from when you brought in a C something or VP something great at hiring en masse, a lot of folks, but not really thinking about the cost ramification or the revenue ramification, to be totally honest. I think that's where you would look at marketing. We need to build a content engine.
[00:15:26] Could it just be one person? That you actually enable with tools and agencies or freelancers or consultants. And I think I kind of asked this question before we recorded, like, would it be cheating? Like, is it cheating to outsource some of this stuff? And I think we both agreed, like, no, it's, it's not, it's not cheating in this scenario.
[00:15:45] And I think at least in marketing, I will say the whole outsourcing debate, it's been, it feels like outsourcing has been stigmatized in marketing as a bad thing. I think it boils down to who is managing it. Do they have experience managing outsourced functions like an agency running your paid?
[00:16:02] You basically gain access to someone who is an expert in a field. Right. And the alternative in, in this case would be to hire an expert full time. And what happens if you want to lower the spend for a period, because it's not working out, you need to fire someone. And then, you know, so you just have way more flexibility when you're outsourcing.
[00:16:22] Toni: No, but also think about like, you can, you can think about Google ads, meta ads, all kinds of ads, whatever you want to, by the way, it, you know, it doesn't actually matter for the point I'm trying to make now. If you were able to automate a lot of the work away that a team would be doing, What does it say?
[00:16:39] 10 people.
[00:16:40] Mikkel: Yeah.
[00:16:41] Toni: A 10 people team suddenly now is maybe just a two people team, right? I think in, in, in locations like Copenhagen, London, New York, San Francisco, 10, you know, eight people save per month. You're talking about a hundred thousand dollars per
[00:16:56] Mikkel: Yeah.
[00:16:56] Yeah.
[00:16:59] Toni: If you were to take that money and put it into some kind of media reach, Like it doesn't, it, screw RRI, the, the eight people team didn't have that RRI anyway, kind of just take, take that money, put it into media reach, put that, would that be bringing you more or less than before, right?
[00:17:16] And I think the answer is yes, it's totally going to bring you more, like period, it will be, right? So I think outsourcing. Totally fine, you know, and maybe this is another episode we're going to run at some point, but almost like a modular organization where it's easy for, for contractors and so forth to attach, for experts to attach and detach over time and so forth.
[00:17:36] And then yes, relying on, you know, places where you can, where you can rent reach, right? And we're going to talk about this in a second, why this is also a bad idea. You need to kind of think about it a little bit differently, but it's, it's still a way you can think about
[00:17:49] Mikkel: Yeah, it will give you a lot of opportunities at least and I think it's also again, back to if, if, if you're going to build up a content function, you might want to even rethink the type of person you bring in, right? It's not necessarily just replicating the work 10 people would do. It's, it's, is it even the right work?
[00:18:07] If you're going to bring in a million, that's going to be the question. It's not like, Hey, we need to produce X amount of. You know, outputs, blog posts, whatever it is. No, no. It's like, we need to bring in the revenue. And I think that's fundamentally going to be the different question as well. And I think your point with the SDR is also a great example.
[00:18:23] That person will have to think a bit about what technology and automations can we use to build that infrastructure and build that setup. Right.
[00:18:31] Toni: When you think about it, like, let's just say you have a hundred million dollar company with only a hundred people
[00:18:38] versus a hundred million dollar company with 500 people.
[00:18:42] Mikkel: yeah, yeah,
[00:18:43] Toni: you think about that, think about the average quality of talent that you will have comparatively to the other organization.
[00:18:50] You only had to get it right a hundred times. The other folks had to get right 500 times and probably because they didn't, they kind of had to kind of try and get right again and again and again
[00:19:01] by hiring more people, right? So the, the quality threshold of your talent is going to be through the charts actually compared to the other organization that you're having.
[00:19:11] Also spending less time on hiring, spending less time on paying. Onboarding and so forth. Those are all massive benefits. Think about all the links that you have between all you know, those, those folks that are suddenly much, much more simplified.
[00:19:24] Mikkel: yeah, I think it's also like, to your point there, when I compare having worked at a late stage scale up with a couple of hundred people versus the last company we worked at together, Seed, we were 20, there's no place to hide, basically. I mean, you can go to the restroom, but then people are going to ask, where is he?
[00:19:43] He's been there for like a couple of hours now,
[00:19:45] right?
[00:19:45] But
[00:19:45] Toni: we know what you're doing there.
[00:19:46] Mikkel: Yeah, but there's like no place to hide versus in a bigger organization, right? There's going to be a lot of. Basically wasted time and resources. You're going to need maybe an, I don't know, an office manager to do stuff. If you're 20 people at a 20 million AR company, are you really going to prioritize an office manager or can you brew the coffee, right?
[00:20:05] There's going to be some of those things where you just don't need the same machinery running. Basically, it's, it's a whole lot simpler to run and streamline the organization, which is, which I guess is
[00:20:14] kind of
[00:20:15] Toni: Which basically kind of goes, but also goes to the next point, actually, kind of, it kind of morphs into the next point, right? Because once you arrive at the realization that it's going to be fewer people. Once you arrive at that point, what, what will also happen is, and it depends, you know, some of you might have not built all the scaffolding that an organization needs in order to actually support those, those hires, right?
[00:20:39] And if, You know, if you have eight AEs, you need a manager. If you have 12 AEs, you need two managers, right? And then if you have two managers, well, maybe it's time to add a director and, you know, and, and the, and, and, and so it goes, right? And this is true for everything. People management needs people managers, right?
[00:21:00] And when you, when you think about an organization with 200 people, I think it's safe to say that around. 40 to 50 of them are going to be only there to support the, the, the people that are actually doing the
[00:21:16] Mikkel: yeah, which is just crazy when you think about it, it's so crazy, yeah
[00:21:20] Toni: And, And, yes, this, you know, yes, you have the CEO and they also do strategy work.
[00:21:24] They do some other important stuff. Don't get me wrong, but their main job is actually managing people. And communicating across, right? Again, like if you have 200 people, think about all the links between them that need to happen for them to actually be fully in the loop, because that's just too many, right?
[00:21:43] Every single person would have 200 connections, that, that, or 199, that doesn't work out, so that's why you have managers that take care of the communication, filter this, put in the right tubes, and then let you know this, you don't need to know this and so forth, right? That, that would be simplified down.
[00:21:58] And by the way, those 40 to 50 people at the top there some of them probably carry the most expensive salaries in the whole
[00:22:05] organization, right? And it goes further than that. And then this is, you know, I put them part into the 40 so maybe that's, that's what kind of makes you feel, Oh, this is like a blow to that number.
[00:22:16] You also have in there people running, you know, payroll you know, accountants, HR staff office managers. I don't know all the, all the other folks that are still need to be there because you need to manage a team of 200 people basically. Right. And there's just an, it's just an operation to just do the monthly payroll.
[00:22:34] It's just an operation to the monthly accounting, closing the box. It's just like, and you need professionals for that stuff. Right. So, when you, when you think about the, the simplification that you could achieve by reducing this team, it's not only that people know each other better, you have higher quality of talent.
[00:22:52] You think about the whole thing differently. You also need less of those silly managers like you and I that are just running around and directing people and something like that. And I kind of, you suddenly don't actually have the need for that stuff anymore, which is a lot of money is suddenly also saving, right?
[00:23:07] Adding to this 1 million per year milestone that we kind of advocating for.
[00:23:12] Mikkel: Yeah, it kind of, it kind of escalates or, you know, spins out of control at some point, right? Because you also need those additional Salesforce seats, right? And again, if, if you have a person who is the equivalent of three, then, then you just need way less seats. And I also just, the other example I had in my mind was I saw this picture of a kitchen where like a Michelin kitchen, you maybe have, I don't know, 20 staffers all prepping and cooking food.
[00:23:36] But then you have 10 people just supervising. No, that's not gonna, that's not gonna work. That's not how this goes. Um, So yeah, definitely. I think you will have a whole lot simpler org and it's also, it's going to be a much easier to make decisions basically. Right. And I think also to a degree, some of those decisions, probably they will be better, honestly because you don't have so many people's interests to take into account, so many people to hear out.
[00:24:00] So you can just move faster
[00:24:03] Toni: and, and, and, and one other thing that just comes to mind and this is maybe speaks more to the VPs and app that are listening, but think about how much less politicing politicking is going to go on. Like if, if, if the amount of those 40, 50 people, which we all know. They're kind of done with the people management and communication at some point, strategies maybe once a year and so forth. What else are they doing the whole day long?
[00:24:27] They're thinking about how can I get ahead, right, kind of how, how should we kind of, and some of that stuff will just die down because you either won't have those people or everyone will be, you know, focused anyway, right? So there's so many benefits in having a small organization. And when I talked to some founders that, that made the journey from, from zero to, I don't know, two, three hundred folks You know, adding the amount of people is not, it's not a fun thing.
[00:24:49] It's actually a burden to do this. Right. Um, And uh, um, uh, and, and then the, you know, again, there's so many kind of negatives to this and, and this certainly is one of them, right. Kind of the, the politics that's going
[00:25:00] to
[00:25:01] Mikkel: It's also like at some point they leave and then you have to replace them because you have more people. There's more people leaving and more people to replace. And I think by the way you'll truly know whether you've built a strong team because it's so small. I mean, You'll just know, like if, if a lot of people are leaving and you need to constantly replace, you know, a lot of introspection will need to happen.
[00:25:20] I think in a bigger org, it's easier to make excuses to that end. Right. So this is, I think it's going to be a lot harder to achieve than just. You know, optimizing your spend and investments and all, and building automations, it's a lot more than that. That also goes into it. Let's jump into the last point before we run out of time, right?
[00:25:38] Because we spend a lot on the almost the people side, but it's also what do you, what do you get those resources to deliver is actually also pretty critical.
[00:25:48] And one of the things you and I have talked about is the whole, when you talk about Facebook advertising and. SDRs, technically speaking, you're renting a source of growth.
[00:26:01] You're renting it because as soon as you don't invest any more in those, you won't get any more customers through the door. So the way to think about it is thinking about assets.
[00:26:11] Toni: Yes. And so why, why is thinking about assets interesting? Because to a degree, it's something you build up, invest time. It doesn't need to be money. I mean, time is money, blah, blah, but like, it doesn't have to be specifically money that you invest. And that builds something up over time that then gives you benefits for a longer time thereafter.
[00:26:32] Right? And I think the, The most mythical creature you know, amongst those assets is brand. And you know, maybe we should have like a very kind of simple breakdown session on what we actually believe brand is. And, and I think it is absolutely an asset and I think it will help you acquire acquire customers.
[00:26:51] By the way, I think if you're running an outbound, you know, motion and you have no brand, I think it's going to be very difficult if you have a brand. And you put outbound on top, it's going to be much easier, right? So investing in those assets is, is a good idea. That might still be, it's a little bit like you're thinking about which stock to buy. That's, you know, to a degree also an asset. Maybe it's not the, not the right analogy here. But there might be, you might be picking losers by the way. It might happen, right? So right now there's a big debate and I'm not sure if how premature this debate is, but is SEO going to be working out, right?
[00:27:27] Search engine optimization. Is that going to be a thing that's going to work out in the next couple of years? Because AI is taking over search and so forth. By the way, Google still owns 85 percent of search on the planet. So, you know, SEO is kind of still around for a while. So it kind of lets chillax everyone.
[00:27:46] But, but this could be still an decision you make. There's a stock for you to pick, right? Kind of, where do you want to invest? And maybe SEO isn't this, maybe you want to have. JNI, SEO, whatever they're going to, you know, start calling that thing, but basically starting to invest in some of those assets, which will give you returns over time without you needing to put in one additional dollar every single time.
[00:28:09] Right. One other good example that you know, we've, we've seen as Chris Walker, Adam Robinson, both of them extremely successful on LinkedIn. You know, on and, and Dave Gerhard's words, they found their voice on LinkedIn and were extremely successful building a following around it and then leveraging this, following into into building a business basically, you know, from that.
[00:28:31] And, and we saw it with RB two B. They went through, I don't know, to a million in AI and, I don't know, a day and a half or something like that. It was pretty crazy. Well, how, how was that possible? It's not that the product itself was so super viral. It was that. You know, Adam Robinson built a megaphone um, and then told everyone about this new thing.
[00:28:52] And then obviously a bunch of people came in and bought this thing, right? And this, this wasn't a this wasn't a media blitz buy or something like that. That kind of, they did, they, you know, besides Adam's time, they spent no money on this, like at all. Right. And again, this is one of those assets that can give you a huge amount of return on investment.
[00:29:13] For just time, just time that you need to invest.
[00:29:16] Mikkel: Yeah. And I think the classic example is the email list. It's been, I think people have been calling email marketing debt for decades, even when was it Google and, and a couple of others announced that they were increasing this spam threshold and people just lost their mind. Right. I, I think the point really is.
[00:29:33] You have an asset that actually will appreciate in value over time for you will keep on growing. Like, if you, if you truly create great content, people will share that content with others and more will come. Right. That's, that's usually a given. And I think the other superpower that people also kind of fail sometimes to realize is take the case of Adam Robinson, massive following on LinkedIn.
[00:29:58] He could probably transfer that to X. Or transfer that to a podcast or a blog or a newsletter, you know, he could kind of keep building assets a lot. It's a lot harder to get to one than it probably is to get to a few in, in that kind of game. Right. And it's just to have that mindset of versus renting growth somewhere, you will need a balance in the portfolio with something that also is, I don't want to say passive income, but it's, it, it, it requires less basically.
[00:30:27] Toni: Yeah.
[00:30:28] And, and the, the reason why we're talking about this in this context is because it's, it can be an incredibly cheap way to grow your AR, right? Kind of, that's basically kind of what we're saying, which then is also 1 million
[00:30:42] Mikkel: Yeah.
[00:30:44] Toni: about. Again, when we are saying all of these things, we're not saying that you should be taking home 800 K per, per FTE and and put it in your bank account or it's paid as a dividend or something.
[00:30:54] It, you know, we're not talking about under investing. We're talking about. Rethinking your organization to have a bunch of benefits. And think, think about, think about the the journey of building a business, the journey of building a go to marketing, the journey of building your own team in a, in a different way than we've used to, which is really the let's just hire some more folks.
[00:31:17] And we were laughing about this with, with Chris Walker actually the other day. And we were saying like, Hey, you know, folks really still aren't growth at all costs, just at a lower budget. Like they're still doing the same stuff, you know, it's still mini GAC out there, right? It's still the same thing happening and I think what we're presenting is a little bit it's a little bit an evolution step on top of that.
[00:31:36] That, that's, that's I think, well, you know, actually while everyone has been preaching about profitable efficient growth, like Sam Jacobs ahead of everyone, right? They're still lacking a clear practical application of how to actually get there, how to actually do it. And I think what we're kind of discussing here is, you know, one of the starting points to try and go in that direction.
[00:31:58] There are many tactical pieces that we're kind of not talking because we're omitting it or we don't know about them yet. But this direction I think is how we can really, you know, live in this profitable, efficient growth.
[00:32:11] Mikkel: That's it.
[00:32:13] Toni: Mikkel, thank you so much. Thank you everyone for listening. Please hit follow, subscribe and so forth.
[00:32:18] It's for free and it's, you know, supports our mission here. So thank you so much, everyone. Have a great day. Bye bye. ​