Is My Revenue On Track This Year?

0:00Alright, I may have mentioned this in a recent episode, but let's go over it again because I got an email from Alex who writes, I'd be curious to hear how you handle revenue forecasting and revenue pacing, either by month, quarter, or whatever time frame makes sense for your business. Essentially, how do you know if your revenue is on track before you get to the end of the quarter or the year? And if revenue is up or down, how do you figure out if it's driven by macroeconomic trends versus your own offerings? I know there are not going to be some clear answers to these questions, but the approaches you take would be great to hear. Alright, so for us, we take it month by month, but when we compare, we don't compare month over month, we compare year over year. So for example, if I look at, let's just, we're in the month of, I'm recording this in January. So let's say we're looking at January of 2025, right?

1:03I know how much revenue we made in each one of our streams. So we have, for us, Fred Smith University, our streams are essentially product sales. That includes our books and courses. We have our affiliate income, which is mostly from Amazon. We have our YouTube ad sense advertising and we have our app sales or app subscriptions. So those are the four revenue streams, sort of a macro sense, right? I could go into each one like specific books, specific products, but those are the four big ones. And I have those broken down per month and per year. And I do this all in a spreadsheet. So I look at, and I can go, I'm going to go over that spreadsheet in a second. There's like a few actually. So I look at, okay, say it's the end of January, 2026.

2:04Did we make more money this year than we did last year in the same month? Or are we, you know, if we're down, I want to know why. If we're up, I also want to know why. If we're the same, you got it, I also want to know why. Now our business is fairly simple. And if we, and if I can't determine the why from our own, from our own metrics, then I have to assume macro economics. But there are, but there, but for us again, like I said, we're very simple. So let me give you an example of that. And let me, before I do that, let's just talk about the spreadsheets that I used to do this. All right. Now for a while, I was doing, I was using a week by week spreadsheet where I was like

3:06every Monday, I would log in and I would, you know, add in what we, what we made, what our expenses were all that stuff. I did that for like maybe eight months before I, before I realized, this isn't actually useful to see it week over week because I can't make changes that fast. Our business doesn't work like that. Now if you're a business that, or I should say, if I run a business that had really no seasonal ups and downs, and I grew month over month, then I would maybe do it week by week because I don't want to say, hey, why were, why were sales down so much this specific week? Because then maybe you could do something to pivot or, or change something or improve something very quickly. But I think, I honestly think like month to month is also pretty fast, right?

4:07So here's what I have. I have two, I keep two spreadsheets for our business every month. One spreadsheet, I just call annual metrics, all right? Now this is one giant spreadsheet that I've been keeping for 10 years. I started it in 2015. And it's pretty simple, all right? So each sheet in the spreadsheet is marked by the year. So I have 2015, 2016, 2017, and so on. And then the spreadsheet, that actual sheet is broken down into three parts. At the very top, I have the website traffic. So I enter in how much traffic did we get that month? And I look at, specifically when I, when I look at it in Google Analytics 4, I look at unique users per month.

5:08And I look at unique visitors or page views, I look at the individual person. So it's like, okay, we had, let's say, you know, 100,000 people visit the website this month. Great. I track that year over year. So I have one line that I enter that data manually. Underneath that, it says percentage change year over year. And so I do some math, and I compare it to the previous sheet. So if I'm sitting here in 2025, and it's January, and I look at the percentage, I just compare that to January 2024. And that will give me a plus or minus percentage. Did we go up in traffic? Did we go down? And if so, by how much percentage wise, all right? The second section is email. I track how many leads did we get? I don't even look at, I don't look at the difference between hot tub leads and pool leads.

6:08I just say total leads. I also look at the same difference. Did we go up in leads? Did we go down in leads? And leads, in this case, are just simply email subscribers. Did we go up or did we go down? And the other thing I look at is compared to the amount of traffic, what's our conversion rate? We had, let's say, 100,000 visitors to our website, and we gained 1,000 new subscribers, well, then our conversion rate is 1%. But if we got, is that right, that could be wrong. Yeah, that's right. So then if we got like 10,000 subscribers, then it'd be 10%. So okay, we have that number. Roughly we sit at around 7, 8, 9%, and it fluctuates depending on the year or the depending on the month, but are not year and month. And we make changes to certain things, and we can affect those numbers, same with traffic to our website.

7:09The third section is a breakdown of each revenue stream. So I have our affiliate income, our affiliate commissions. I have AdSense from YouTube, I have our app, and I have our products. And I gather all those numbers from those sources. So I gather our product numbers from Shopify, our app numbers from revenue cat. I grab our YouTube revenue from YouTube, obviously. And then I grab our affiliate links from, or affiliate commissions from Amazon. And I stick them all in there. Now I have a couple of different ones here. Again, I want to know how much percentage wise we went up year over year in that specific month. So if you look at the spreadsheet, you have line items going down the left hand side of all of these metrics that I'm talking about. And then across is just each month, okay? And then at the very end, I just have a total, because I just want to see the total.

8:09So I update this every single month like clockwork. I also split the percentages, so I see how much money are we making from our physical products or our product sales versus affiliate income versus app income, et cetera. So I can see those percentage breakdowns as well, kind of like a pie, right? And that's it. That's it, all right? So the simple act here is on the first of every month. Now I think this is where I'm very, very organized. And I know this may be tougher people who are not this organized, but I have committed my entire business and life existence to relying on Asana. Asana is my second brain. If that's the word you want to use, some people use notion, whatever. The reason I think I don't use notion is because notion does too many things.

9:10It can be like a notebook. It can be all kinds of things. But where do you go for absolute fucking trust? That's what I want to know. Where is your trust bucket? For me, it's Asana. Here's how much I trust it. I use it to pay my credit cards on time. I use it to take out the trash. I use it because on, say, February 1st, a task is going to come up for me. I'm going to check Asana because I live in breathe in it. And I go, oh, today is the day where I have to go in and enter those metrics into that spreadsheet. And I have been following this system for 10 years. 10 years. All right. So it's like, oh, it's Sunday. I'm checking Asana on Sundays because I use it for my personal life. Oh, I had to take out the trash today.

10:13My credit cards do today. I had to go pay it. That's in Asana. I check it. I don't use a calendar because the calendar gets too junky. I don't trust it. Anything I put in Asana is mine. And I can create repeatable tasks. Yes, you can use, if you like the calendar view, I fucking hate it. I think it sucks. I don't, not everything has to be time-based. So like, I don't care if, you know, I don't want my calendar to look ridiculous. It's like, I don't need to take out the trash at 7 p.m. on Sunday. I just need to do it that day. And I make sure that all of my tasks are checked off at the end of each day. So point is, I have a task set up that recurs the first of every single month that I have to go in and update this spreadsheet. No questions asked. And I just go do it. But I have a few more tasks at the beginning of every month. The second one is I look at my budget. So I have another spreadsheet, which is called Budget 2026.

11:17And I create a new spreadsheet each year because this spreadsheet file has three sheets in it. So the first sheet, well, I'll say there's two sheets. You have income and you have expenses. Those are the two sheets, right? Same thing. In the same way, we're all of the metrics that I track on the left hand side going from up to going from the top to the bottom. And then going from left to right is our months. And I just track how much money are we spending, let's say, an expenses for tech, for salaries, for contractors, for health insurance, for purchasing books and shipping books. What are we paying? Now these are round numbers. So I use QuickBooks to track everything to the penny. That's where that lives. If I want to check something to the penny, I can go into my profit and law statement and look at that. But for this, it is a budget.

12:20I am looking at how much money are we spending roughly per month? So here's how I break it down. I use WP engine for hosting, for hosting my website. Now I pay per year. I think it happens in September. So every September, I pay roughly like, let's just call it $1200 a year, right? So what I do is I take that number and I divide it by 12, which is $100. And I stick $100 in my WP engine line item for January, February, March, until December, right? Which then totals to $1200. Now I'm not actively paying that every month, I only pay it once. But what I want to roughly see in this spreadsheet is, what are there, what are our active subscriptions? What do they cost per month, even though we get the discount for paying yearly, right?

13:22What do they cost per month? And I just want to know, are we per month making more than we spend? That's simply it. Now that's the expense sheet. There's another sheet called income. So how do you determine this one? Well, we use numbers from the year before. So in 2026, I have a new spreadsheet, right? I have all of the same numbers from 2025, and they're marked in orange. And as I get new information, I just update those numbers. The reason I do it this way is because I can clearly see by changing the number, I have a number, let's just say it's January, February 1st, and I have my four line items for my income, all of my different streams, right, which I mentioned earlier. And it's January. Now they're all marked in orange, which was last year's numbers, right?

14:25So ideally, we'd say, okay, as long as we just hit last year's numbers, and this is what we're currently spending in our expenses, we're good, right? We're good. We're profitable, barely, but we're profitable. You're right, everyone gets paid, cool. So then I go in at the end of January and say, okay, I need to replace these orange numbers with black real numbers, all right? How much do we actually make in January? And if those numbers are lower, well, we have a problem, we need to go and investigate if they're higher, well, I still want to investigate, but at least we don't have a problem. And if they're the same, I'm like, all right, nothing's urgent, there's no problem. But like, hey, can we do anything better? And so I just go and do that. Now most of the time, we have been either stagnant or a little bit better than the previous

15:29year. Because again, our marketing efforts are fairly easy. But since 2023, our traffic on our website has been going down. Now this year, or I guess in 2025, we started adding more articles to our website and we're starting to notice that we are mitigating the damage and perhaps going in reverse, right? We're climbing back up. But I think that's going to take probably an entire year to see the trends start to go in the opposite direction, right? So I'm hoping that this year will start to see that trend go up. And if that trend goes up and we're making less money, well then, hmm, that's not the problem is it? Right? If we're getting more leads and our money is going down, maybe we need to do a better job at converting as opposed to just getting traffic and leads. So again, all we're trying to do is get traffic and leads.

16:30That's all we're trying to do. The more traffic we get, which means the more leads we get, which usually means to the more sales we get. So it's that simple. If I want to affect sales in the current environment that we work in, that's really what I got to change, how many new leads we get. That's it. And traffic can come from many places. It can come from doing articles on our website. It can come from posting more videos, long form videos specifically. And we will get some sales through, so I would say like all of our social media stuff. That doesn't actually improve leads or traffic. It improves conversion. So we have to assume here that there are people who are watching our short form videos, right? They may not ever have pulled the trigger on anything, but they at least know who we are. Right? We're no longer strangers.

17:31There's some trust built. And then somehow for some reason they find our website, they subscribe or they watch a long form video and subscribe or buy one of our products. The reason they're buying our products is because they're already familiar with us. So the way I consider social media is simply like a trust builder, a conversion optimization play. And so that's why this is very easy. We don't do paid ads. Now if we did paid ads, that would be a different source, right? And we want to know, are we getting more traffic? And those could have effects, but for right now, everything's organic. So diagnosing the problem because our business is so simple is also simple. It's like, oh, there's the problem, we got less leads this year than we did last year. So therefore sales are down. But sometimes we're like, oh, actually we added, we started promoting this new product and we actually ended up making more revenue despite traffic and leads being down, which

18:34means we got better at another part of our business, which was we either raised prices or we got better at conversion or we added like an upsell that wasn't there before or we improved our welcome flow or whatever it is, we can figure out that pretty quickly because again, the business is so simple. And this budget spreadsheet is simply a sort of 50,000 foot overview of income and expenses. And then we have the third sheet, which is just an aggregate of those numbers. So we say, so we call it the dashboard sheet. And in that sheet, we have, what is the monthly income, what is the average monthly income, which the average monthly expenses across all 12 months. And then how much do we pay towards taxes, we just allocate money towards taxes, and then we go, what's our profit, that's it. And then we have that for, we have one section that is just for the average month to month,

19:38and then we have the total for the whole year. And all we have to do is make sure that that dashboard is, we're positive in profit, that's it. Now obviously we want to get like, we want to be really, really positive in profit. And so we're making changes to do that. But that's how we forecast it. It's not, it's not really a forecast. It's like, okay, here's what we did last year. We know those numbers. Here's what we're currently spending, again, rough estimates on both. We know this. We know we're profitable this year. If everything stays the same. If we get the same traffic, the same leads, if we get, if we send the same number of emails, we publish the same number of videos, like we know that we'll probably get this around this amount. Now if there's a significant drop, right, if there's a significant drop in revenue, and nothing in our process has changed.

20:39We haven't changed how many emails we send. We haven't changed how many videos we make. We haven't changed, like our traffic stays relatively the same, our leads stay relatively the same, our products stay the same. So all of that is true. Well, then I have to, then the only thing I can conclude is that our conversion sucks. But of course, I'm going to know that. There's going to be a number that, that number's going to change. But let's say it doesn't change for whatever reason. Okay. What that tells me is maybe there is a macroeconomic reason for this. Maybe people are finding our products, they are seeing it, but they are not converting for some reason. Why? If we haven't changed anything, because our conversion numbers stay relatively flat. They stay the same, which is good. We want to stay there. We want them to stay there. We want them to drop.

21:39Of course, we want to increase them, which we're going to do. But again, as long as all of that is true, then we could point to macroeconomics. The truth is, if it's macroeconomics, then we're going to see a number somewhere drop. It might be traffic, most likely going to be traffic, because then people won't be searching for things to buy, because they don't have any money. So why would they even search for stuff, right? Less people may be watching our videos, less people may be clicking on our ads. Who knows? To me, there's much bigger problems there, and to be truthful, we're in that weird business. And I've told this to people, and look, you can fight me on it if you want, because I've been saying this for a while, I'm pretty sure I believe it. I mean, I know I believe it, but I'd be curious if anyone has another take. We happen to be in a business that does well in both a recession and a surplus.

22:49Why? In our world, one, our products are not crazy expensive. We're not like the most expensive product. You know, we're not selling anything over $1,000. It's not happening. So already, our products are under $1,000, which to me says they're affordable, anything under $500. Actually, none of our products are over $500. So we're going to be, we're affordable all the time, all right? So here's what happens. In our business, let's say it's a recession, right? In a recession, pools don't disappear. They're in the ground. They're stationed in your backyard, all right? You may have had someone taking care of your pool for you. You may have hired a service provider, but now you can no longer afford that. And so now you're forced to service your own pool, DIY style. So who are you going to call?

23:51You're going to turn to us because we're the ones who help you with DIY, right? So we get more customers in a recession because people have to make this switch. Conversely, in a surplus, those people who have those pools, they may get people to come out and service their pools because, hey, they have this extra money and they don't feel like dealing with anymore. That's fine, right? But more pools are being built. So now there are just more pools and there are people who just like doing things themselves. And there's also going to be a supply issue in terms of service workers. So you may have the money to do your own pool work or to hire somebody to do your own pool work, I should say, but there may not be anybody who can do it. And so you're forced to do it yourself.

24:51You still need help. Where do you turn us? So either way, we have customers. Now the problem with our business, which we recognize, is that, and we have basically solved this problem, but we are in an education business. Now a lot of people will think, well, okay, you know, chat GPT is going to, or AI basically, not chat GPT specifically, but AI could take over, could kill the education market. And it's like, yeah, I probably could, but right now, I don't see that happening. People still want to watch videos. People still want to learn from other humans. People still want, people, they're still a trust factor. And not everyone trust AI. It's not always accurate. So it's right now, we're not at that position. Okay, so the problem though is like, let's say someone buys our book and someone buys our course. Great.

25:53They've essentially graduated. They're done. We have nothing else to sell them. But of course, we came out with an app, which is more of a tool. And so now we do have our subscription model. Mind you, all of these things are very affordable. None of the things that we do are very expensive. So therefore, we have to play a volume game. We have to get as many customers as possible. We have to get every single pool DIYer out there. And that's where we spend all of our time. We are constantly posting new articles. We're constantly publishing new videos and new social media posts. It may, there may be a point this year where we have to start doing paid advertising. Because we have the systems really dialed in because right now, we're a little blind. And this will be solved this year. We're blind in how many people buy all three products.

26:57Because we do know, because of our analytics, if people buy our book and our course or multiple books or whatever, we just don't know if they're buying our app because we don't have any way to track that right now. But we are solving that problem. And so if we solve that problem, then we'll be able to safely say, OK, here's, here's like a perfect customer. And here's how much we make. Here's basically, we can get our our true LTV number, our lifetime value number. And then we can start running ads against that. Once we know, because then we can like say, OK, we want to keep our CAC or our customer or cost per acquisition lower than our LTV, hopefully by about, you know, hopefully 30%. So it's like, if I spend one dollar, I should at least be making three or ideally higher.

27:58But anyway, I feel like I went off the rails there a little bit, but that's how we do it. So if you have any other questions, you want me to expand any more on that, I think I kind of expand it quite a bit, let me know. Thank you, Alex for your question. Go to Jivinesci.com, gen. V-A-N-S-C-I.com, I will talk to you next time. And I'll talk to you next time. Thank you. Now, will you. So if you have any other questions, or anyone to expand any more on that, I think I kind of expand it quite a bit, let me know, thank you, Alex. And go to Jivinesci.com gio V-A-N-I-S-C-I.com. And I will talk to you next time.