We talk about sales a lot for small businesses and entrepreneurship, and early on the key is quantity. You have to make hundreds of cold calls, or put hours of time and effort, to get revenue streaming into your business. If you take a lot of at-bats, you’ll get hits. Where people mess up, later on, is in quality. My golden rule for real estate and small businesses is knowing when to take quality over quantity.
Let’s look at real estate as an example; as a small shop, we’ve been able to be really selective about the deals we do at Bolt Storage, and this has allowed us to only focus on good deals. A few small, single deals have been able to change our lives. We made a lot of calls and saw a lot of deals, but it wasn’t about the numbers, it was about choosing the few good deals that could drive our business.
This is our advantage over a private equity shop that needs to keep doing deals. If their deals stop, their operations stop, and a great or bad deal doesn’t move the needle as much. Small shops can choose quality over quantity.
My brother took the same approach with his lawn care company–he made the decision to fill his funnel, aiming for 100 quotes per month, but to bid jobs high. He goes after clients who want professionalism and quality service so that only 30 of those 100 people sign-on. He’s able to do less work while maintaining healthy revenue and margins.
This will apply to all areas of business, early on you need to say yes and fill the funnel, but as you begin to choose where to focus your energy it’s about quality over quantity. Two years ago we didn’t have access to capital at Bolt, and some family offices approached who wanted to provide capital but wanted to get 80% of carried interest (profit) and high levels of volume. Instead, we’ve been able to grow on our own terms with quality deals and now get 50% of the carry with our investors.
When it’s time to grow, a lot of people forget to be selective with their time. Money is valuable, but time is your most valuable asset, so it’s vital that you pick the right opportunities to invest your time in.
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