Business Mistakes That Cost You Millions (What to Avoid)

0:00Have you ever made a money mistake so bad you wanted to cry, but instead you just laughed because honestly, what else you're gonna do? In today's episode, I'm spilling the tea on the top three and most expensive money mistakes as an entrepreneur. I'm talking about the hires I regret, the big bets that flopped, and the times I should have trusted myself, but didn't. And here's the thing, I lived to tell the tale and you will too, because mistakes aren't the end of your business. They're part of the tuition you pay to be a CEO. And if you stick with me until the end, I've got a free gift for you, my CEO money recovery checklist. It's seven simple steps to bounce back fast from any financial mess up and turn it into growth. You're gonna want this. So hit that like button, subscribe if you're new, and let's dive into the money moves and missteps that got me here. So let's normalize screwing up with money and recovering from it. And let me share you a stat just so you know that it's real. A quick book survey showed 61% of small business owners have made at least one major financial mistake, but most recover and keep going.

1:00Just know that the mistakes that you make do not have to take you out. So let's talk about the number one mistake that I see people make. Hiring outside agencies instead of trusting yourself. That is the number one mistake that I see entrepreneurs make. And how do I know entrepreneurs make this mistake? Because I've made this mistake. I've had big problems in my business that I'm trying to solve. Maybe I'm trying to solve a big marketing problem. Maybe I'm trying to solve an operations problem in my business so that we can accomplish more with the team or the systems that I have. Instead of believing that I can solve it, I hire an outside agency. And I've hired an outside agency in the past that has worked out well. They come in. They help me solve this problem. Most of the time, most of us are hiring agencies and we're outsourcing all the decision-making we're outsourcing all the problem solving to them and it usually doesn't work out. Okay. In my experience, I've hired so many marketing agencies, so many different types of agencies over the years. And I'm talking tens of thousands of dollars spent with nothing. I mean, sito, point, sito to show for it. And so if you're thinking, oh, I'm just going to hire that

2:02marketing agency or I'm just going to hire that ads agency or I'm going to hire this consulting agency and they're going to solve all my problems. No, they're not. You know who's going to solve your problems? You, you are going to solve them. And so what is best is if you identify what the problem is yourself, you figure out what the solution is yourself. And then you can hire an agency to help you execute the solution. But if you outsource all the problem solving and the strategizing to somebody else, it usually doesn't work out. And I speak from 15 years of experience. Now, definitely, there's amazing agencies out there that I have worked with that I still work with to this day that are incredible in helping me accomplish things in my business. But when I outsource my job as CEO to an outside agency, it never works out well. You're the CEO, you are the leader, you are the founder, you know what your vision is for your business better than anyone else, you know your ideal customer better than anyone else, you know the problem that you want to solve, better than anyone else. So trust yourself to solve this problem and then hire help to help you execute the solution that you've already figured out for yourself. But stop outsourcing the thinking

3:06and the big decision making in your business because it will cost you a lot of money. Moving on to mistake number two, not firing fast enough. I'm about to hurt somebody's feelings. And here's why because most entrepreneurs are hiring people, they work with them for some time and sometimes you know on day one, it ain't gonna work. Or maybe they worked for a while and you've outgrown them and you're letting them continue to sit on your team, continuing to collect a paycheck week after week and they are not doing what you need them to do anymore. The business has outgrown them, the role has outgrown them and because you like them as a person, you keep them on your team. Ask me how I know because I've done it. And then not only do they wind up being on your team for a long time not doing the best work that they could do, doing mediocre work, which means that your businesses getting mediocre results. So you're spending the money on their salary, but then they also make mistakes. So then those mistakes cost you money as well. I have never my 15 years of working with small businesses ever talked to an entrepreneur who said, I really regret firing that person. Literally never. The regret is always, why the hell did I not fire them faster? How did I let this

4:10go on for so long? How did I waste so much money? How did I waste so much of my own time managing that person? Because when someone requires so much management, it's because they're not a fit and you need to let them go. So if they take up all your time with managing the hell out of them, it's because they need to be fired. Okay, so they can find a role where they don't require so much management because this doesn't suit them anymore. And don't take my word for it because you know I always come with the stats. The US Department of Labor estimates that a bad hire can cost you up to 30% of the employees first year earnings. So if you're paying that person a hundred K, that's 30 grand. If you're paying them 50 K, that's $15,000. And some of y'all have three and four people that you need to fire, right? So multiply that by the number of heads that you know, you need to let go so that you can build the team that can actually take you where you're trying to go. All right, now number three, biggest financial mistake that I see business owners making is diversifying too early. Big bets without due diligence are going to cost you a lot of money. And I did this. So that's how I know. I decided at a certain point that I wanted to diversify.

5:12I had an amazing business. It was generating great money. But all of my personal net worth was tied to my business. So if something happens with the business, my whole net worth would be gone. So at some point you do want to diversify, but you don't want to do it too early. Well, I decided that I was going to make a big bet and make an investment. It was related to real estate. And I wound up losing an enormous sum of money brought tears to my eyes amount of money. That was lost. Why did I lose it? Because I didn't do my due diligence. Listen, whenever you're too excited, you had to be like, pause girl, stop it, take a moment, take a breath, sleep on it for a day or two or three. I moved too quickly, got too excited and let that excitement override the genius that I already have to know due diligence is required, right? Like really do your research, really set up your support like the lawyer and the accountant and whoever else you need to make sure you're doing this the right way. And so I wound up making an extremely costly mistake. That was pretty painful. Of course, I learned a lot from it. You'll read all about it in my next book. But just know

6:17one of the things that I was doing was diversifying too early. And if you're not making at least multiple seven figures yet, you absolutely should not be diversifying. That is not the time to go, oh, let me go start this next offer. Let me go launch this next thing. Let me go get into this other thing. Your business is barely off the ground until you have a team that is fully running your main business and it's still profitable. Customers are getting served even when you are not there all day every day. That is the only time that you actually have the amount of time you need to then go focus on a new thing. Because any new thing that you're going to launch is going to require some of your focus. It's going to require some of your energy and that's energy you're taking from a thing that's still budding, that's still growing. So when I see these Forbes article that's 12 streams of income, 12 streams of income that you need to create if you want to be wealthy, no, create one stream of income, do a really good job of it, get it to multiple seven figures, then you can go create the other ones. Those are the three mistakes that I don't want to see you make. All right, so let's talk about them. One, hiring outside agencies instead of trusting yourself, trust yourself to solve the problems in your business and then use an outsourced team to help

7:21you execute not to actually solve the problem. Number two, higher slow, fire fast. That advice will serve you well. And if you know somebody's not working on your team, stop letting them make mistakes, stop letting them take up time, stop letting them waste your wages that you're paying them instead of getting somebody who can come in here and absolutely kill it. And then number three, don't diversify too early, stay focused on your main business and allow that to really grow and flourish before you get distracted by something else. And neither one of those things then wind up being as successful as they could be. I don't want you to be down in the dumps. I don't want you to feel like, okay, it's over for me because I've made these mistakes. Here's what I want you to do. I got a framework for you to follow. So the first thing that you're going to do is acknowledge the mistake. Face the mistake and own it. Acknowledge your partner. This is how we get those lessons that become valuable experience for us. Okay. Number two, extract the lesson. Ask yourself, what am I going to do differently next time? I've made this mistake. I've learned from it when I'm presented with this kind of opportunity or challenge or situation again. What am I going to do

8:23differently? And literally write it down because that's how you really make sure the lesson seep in. And actually share the lessons that you've learned with some of your friends because your friends will be the first one to be like, you going down the wrong road again. You said you weren't going to do that again, right? Because we make mistakes, honestly, sometimes again and again before we really get the lesson. Take the time to extract the lesson and then share the lesson with a friend who will hold you accountable when that situation comes up again. Number three, fix it. Okay. Fix it and fix it fast. If you ventured into some new territory by trying to diversify and you're like, oh, I'm on the wrong path, pull back. Say, actually, never mind. This is not the path I want to go down. I've changed my mind. Disappoint people. Okay. Here's what I do. When I'm about to fire someone, I write some notes in an iPhone in my iPhone, like in the iPhone note to app. I just go ahead and write down like, here's what I want to say. I get in front of them. I have my notes. I go over it with my notes. Done. If you're firing the right way, it should not take more than five minutes. All right. If you're still on a firing call 20, 30 minutes later, you're on the wrong track and

9:24you to get out. Okay. When people get fired, it's disappointing. It feels like rejection. They want to go sit with it. They don't want to keep talking to you. So just let it go. Let it be done. And then whatever it is, if it's requesting a refund, renegotiating, canceling a contract, firing the person whatever you need to do, do what you got to do, even refunding your customers. If that's what's necessary because you've made a mistake customer service-wise, like whatever it is, fix it, take the lessons from it, take the L and move on. The next thing I want you to do is file it as tuition, right? Consider this the cost of growth. The same way you would invest in a training program or learning something new. That was the investment you just made. Whatever that just cost you financially, that was the tuition you paid to get that lesson. There are some lessons that you are only going to get by making the mistake and have it be costly and have it be painful. And that's how you really get that lesson. And it's never going to happen again because of it. Okay. So just know it's a cost of growth. It is not a death sentence. It does not have to take you out of business. It does not have to lead you to bankruptcy. Like remove the drama. Okay. Except it for

10:28what it is. And then allow yourself to do number five, which is move on. Okay. Your last step is to move on. Don't let shame freeze your progress. Once you've made a mistake, you've done the process of acknowledging it. You've extracted the lessons. You've done, you've taken the steps to fix it. You've accepted that this is the tuition you had to pay. Now move on. Forgive yourself and let it go. Okay. Let it go. If you got to write it down on a piece of paper and burn it, whatever ritual is necessary to let it go and move on and just know that this is part of being an entrepreneur. This is part of being a business owner and celebrate the fact that you're out here being courageous, trying things, taking risks and accepting that mistakes are part of that and allowing yourself to recover from it. So here's the thing I want you to know. Money mistakes are not the end of the world. They're part of the journey. Even for millionaires, even for seven figure and eight figure and nine figure entrepreneurs, we're all still making mistakes, right? We're all still failing forward. That is part of the journey and you know you're winning when you can laugh about it,

11:32when you can accept it and when you can extract the lessons and keep pushing, right? And move on to the next mistake you're going to make, right? And just know this is part of the journey and this means I'm out here in the arena doing the damn thing. Now I have some goodies for you that I want to share. So we've got an amazing download for you, the CEO money recovery checklist. This is going to help you. It is a free guide with seven steps to bounce back fast from financial mistakes in business. So if you've messed up with money, join the club, right? You're not alone, but here is your checklist of what you're going to do to recover, including if you need to make some more money to recover from the money that you lost. Great. You're at entrepreneur. We're going to show you how to do that with this checklist. You can download my free CEO money recovery checklist by going to hello7.co slash download 65 right now. Go get it. Download it. Do the work so that you can recover from your mistakes and keep making money. I'll see you on the next episode. Bye everybody.