WTR Interview: Thor Conklin, Success Meets Profitability

Transcript

[0:01] Wealth Tactic Rebels, the podcast for people who see things differently.

[0:12] Welcome to another entrepreneurial interview with wealth tactic Rebels the podcast for people who see things differently.

Post Kevin Dumont I've been seeing things differently the well fill for well over 10 years today I'm joined by a guest Thor Conklin Heath or how are you today.

I'm doing well man thanks for having me on. Fantastic! Glad to have you here looks like the season is warming up finally, for us. I'm sure it's warmer Where You Are. It is. Atlanta, Georgia.

Excellent! So Thor Conklin is an entrepreneur, maybe a serial entrepreneur. I don't know, should I say?

Yeah, recovering serial. excellent profitability consultant host of his daily podcast Peak Performers Podcast.

Thor would you mind sharing a little bit of your backstory for our listeners you know where you got started I kind of got to where you are what things,

play shake your philosophies along the way.

[1:15] Yeah absolutely you know I've been an entrepreneur for the last 20 years either started or purchased businesses this is my sixth and seventh business,

and the first one I just got a filling and it was interesting because

play came to me and said hey would you set up your own company and manager portfolio is a private Equity Firm on a worldwide basis so is a great opportunity not many entrepreneurs got to get their start that way so I was very fortunate.

I'm one of the things that I was focused on from the very beginning is the notion that profitability is really what drives an organization without profit she don't have the excess Capital needed to grow the business the higher the team that you need to,

she's so often that I was going to get wrapped up in this ego of okay.

I've got this one revenue and I'm buying a bunch of do dads and at the end of the month the end of the year there's really nothing left over so,

really on a mission to help individuals North really understand finances,

and that what it really means to drive a profit and then take that profit invest that and grow it.

Right right so profitability that's where you're probably Consulting comes in right direct from what I know from talking with you 96% of businesses will fail within the first 10 years right and then.

Really the big reason all that failure is lack of prophets so I'll before that do survive.

[2:44] Made them are producing a prophets even break even.

Maybe pay a little bit of a wage to the owner right shareholders below-market Valley returns so this sounds like this is the problem here right.

[2:58] You know it is highly profitable organizations that are an issue with that organization,

but if you're in the right Market in you're producing the right profits that's really what it's all about you. Sometimes I get a lot of flack on social media it's like all you know there's more to life than just Prophets

yes there is absolutely but when you have the profits you can do a lot more look at philanthropy.

That doesn't happen unless somebody made a profit and had the cash then donate and do something great with it,

this notion of you no profits are evil will I contend that no profits are evil you know and I really.

Got wrapped up in this NN really what how this last business was born

WhatsApp of a disaster I had a manufacturing company was multimillion-dollar company dead industry to be in low margins

was just always a cash flow disaster and it finally got to the point where I was reaching $1000000

cash loss in the business and I just said this is just insane it just got to get my ego out of this and sometimes you're just not in the right business,

and the right segment so you can do everything right but you don't like today who out there wants to buy a taxi cab company.

[4:13] Not a good investment right not since Uber came around right,

right but go back 15 years in New York City you know the medallions that you had to buy that little license at you stuck on your tab actually even rivet it on to cancel.

We're going for Millions.

Times change markets change and you've got to be flexible and change with the same thing with investing you know some of the top names today.

In 10 years are they still going to be around maybe yes maybe no but there are things Kodak right Investments.

[4:49] 30 40 50 60 70s 80s 90s,

Toys R Us Toys R Us there you go used to love going to that store you know my son was a little younger I'd bring him there and they just stats.

You can't do that anymore get out of your head.

The only reason of business is closed so profitability whether it's in a business or,

personal is very very important what are the things that I do with my clients is I had them treat their home life and their family life or family budget,

spending you know I don't like to talk about budgets I like to talk about spending plans you know nobody wants to be budgeted

so what I prayed for my client has a spending plan I how much money is coming in to drop it until these buckets the mortgage the rent the credit card the kids snow food and clothing Etc.

And then just spend whatever in that pocket in each week as you get paid $50 goes into the kids budget.

[5:51] $25 goes into the electric bill and at the end of the month before we got $100 in the electric will the electric bill comes out to be 118 got to go steal $18 from one of the other buckets

and it might be the kids keto food money order,

when we track and we measure we keep track of what we're spending.

You start to do something it's like last month we spent $400 going out to eat,

I really want to go to Disney World this year next month instead of going out to eat we just take that money and put that into her vacation bucket and when it's all laid out there.

It becomes a family project if you're married and you got older kids it's like come on,

come on in let's sit down on a Sunday once a month and look at where we're spending money and where we actually want that money to move into

it's a great way to figure out what's coming in what's going on and where it's going out and you can direct and I encourage everything that comes in should be spent

because there is a bucket there for investing as well.

That investment pocket then gets spent or invest it into some sort of asset.

Right right. So I agree we talked about that to hear a lot I will have troubles both having buckets to put your money in and it helps to separate.

[7:10] Yeah you know whether it's your overall we talk about we have a call we call purse looking out the mall so we have a very simplified what you do with your money right and it's clear definition Investments,

hopefully we'll bring a return but there's a risk.

And investigating on the side you have some guarantees there so you can't lose your money or the value of your money and then you can get into things separately to like attacks buckets. buckets. It helps to strategize a little bit like that too.

When you're trying to think it's proved how you going to manage your money right we're all my clients the first thing that we do we take out the pot money.

All right and what is not a reference to marijuana that is I want you to take out the prophets first compensation and take out the taxes.

Once you remove those three things out of your business every single week what's leftovers the money to run the business but what are those businesses do.

[8:11] They take it a dollar.

Many think that the dollar is actually profit right it's not pretty sure that's a profit you've got it then pay all the expenses to run the business and then at the end of the month

if there's anything left it's like that goes to the owner

we don't have any tax money we don't have a prophet money take those things out first run the business on what's left just reverse it flip it upside down

there you go so that's one strategy to help

manage the profits of the business raining at home rename those profits taxes if you are an employee or having the taxes taken out of your paycheck but dropped into the shepherd the buckets

the quick story when I was my daughter's now 24 when she was in high school

I'm at that's great you know what job are you going to get just like no no I want you to buy it for me I said I think

I may have confused you or your confused.

Yes we're going to go to school you know this is not fair I'm like well I guess you were born into the wrong family

I said what I will do though I said you are student and that's really your number one priority what I will do though is I will.

[9:29] Loan you the money and I will loan you the money at 10% interest and she's like 10% interest I'm going to give you a life lesson that when you don't have the money and you borrow it you have to pay interest and that interest really starts to,

they suck this is real world she said what what am I going to do I don't have a job.

Pictures of babysitting and swim lessons and all that sort of thing in the car payment was $200 a month I said I'm going to give you a $200 a month job,

and the job is at the end of the month you have to prepare a balance sheet and a profit and liability statement for me.

And it's due on the 5th of the following month if I don't get it by V you don't get paid.

[10:13] Guess I don't know what a p&l and a balance sheet is I said that's okay I'm going to teach you how to do that I don't want to do that I said I don't care if you want to do it or don't want to do it these are basic lessons that you need to learn in order to be what we call an adult,

rice pot Bulldog price so she hated it cheapest about it

and she didn't get paid or 200m like I need the $200 car payment or I repossess it real world again

fast forward she hated the process but you know what,

she started to understand where she was spending her money because she had line items every time she took his money and every time you spend money.

[10:59] I would have liked that $65 to do something else.

It was a great lesson to understand where the money's coming in from where you're spending the money and couple years later she turned around she said you know Dad that was one of the best lessons that you ever,

as a young there you go excellent learn where it's coming from and she's going to be ready for.

Yeah whatever face is her if she goes into business herself she's already understand it you being a profitability Consulting you already understand that you know a lot of business struggle with that so.

[11:34] That's a good step up naturally with the audience which I call my 1% Savings Plan yeah shirt,

we all know that at the earlier we start doing this with compounding interest in everything in our investments the better off we are but you know sometimes to start to get that money that savings account or that savings percentage shop Hilltop in Michael with

all my clients is to get them to 50% of what they're taking home

as savings and Investments and of course you just can't come right out of a block and save 50% so my clients that is unusual

if you don't have any savings or Investments at this point is a credit when I called a 1% savings club and that is a month one,

take 1% of what you take home put that into your investment of your savings bucket whichever you guys recommend.

Next month make it 2% 3rd month 3% just increase it 1% every single month it is so easy to go from nothing,

and to get that up to 15% 20% 25% bright harder after that right right.

[12:43] The point is you've gone from nothing or a low percentage,

and it's just 1% a month 1% one and then you look back and it's like you know what this really wasn't that difficult it's when we try to make these,

significant changes that's what it could be that's a great value bomb right there yeah very nice extremely helpful is that 1% of the time.

You're not going to really seal it that way it's it's it's like you know when you're cooking

you know you just turned up you know things in your budget.

The bleeding right right exactly what you talked about that too I thought you going to stop the police first I'm so lit right now

help them with probability and wealth building.

[13:45] Yes I remember a mentor to asked this question of myself and there were a few other people in the room at the time.

[13:53] He said I want you to close your eyes for just a moment and I want you to think about the three biggest.

Investment or business mistakes that had Financial consequences to you in your lifetime.

[14:08] And I want you to think of what those amounts were.

[14:12] And then I want you to replay the movie had you not made those mistakes what would your net worth be today.

[14:21] And it was like damn that is powerful all trying to figure out how to hit the bases you know that doubles and singles of triples a home runs and all the winds.

[14:34] But it's our losses that Define us. Hopefully for my identity stamp Bryan right but if you have $100 investment.

And you lose half of it and down to 50.

You've got to make 100% return yes you're right you're right so powerful you can limit the downside

you'll win on the upside exactly it's not the homeruns it's the strikeouts that kill us

in exactly two and we talked about that a lot here will have troubles to avoiding the losses you have a lot more long run than you could just chasing razor return it's just like you.

If you're golfing what's the club that more than likely is give me the one that's going to win it for you.

[15:21] The Potter right not the everyone wants to get the best driver in the world but more often. That's what's going to lose it for you.

Yeah yeah those are the ones that put it out of bounds I don't think I've ever put a ball out of bounds on my putter

I might have once when I was learning one or two in the lake but but.

You swing for the fence is it goes out of bounds and now you just incurred a penalty stroke so what do you do.

Did you take the safe shot out and just take your medicine.

Or maybe a bogey or whatever.

It just starts the compound itself.

[16:14] That's what ends up happening a big loss and then you double down,

how do you start taking a risk your approach cuz you want to make up for it cuz you said you were gaining whatever you're getting before now you got to double it.

[16:30] Just to get back to even careful of those losses experienced performers out there right now.

[16:40] So

Do you have any lessons that you learned from interviewing them that you could share with our well that the rebels that might be useful for them it's interesting

practice is profitability salting I do business coaching in my Lane that I service are entrepreneurs that own their own business,

they're making a half a million dollars a year or more in personal income so they're running a business between two starting at two or three million dollars.

And then that I work with the large you know hundred-million-dollar organizations.

The most successful clients over the years that I've worked with.

Is there currently out there hitting those singles right there trying to figure out how to improve.

They're always looking tracking measuring and adjusting their looking at their numbers weekly daily,

they're on top of the numbers they know what's driving the processing know what's changing and the other thing is is that many.

[17:43] Or in or have investments in real estate and there's a reason.

If you go back centuries that real estate has always been a very popular wealth-building model price.

If you're listening to this podcast in the United States and I'm not a real estate investment Guru by any chance I'm just I'm just telling you what I see.

[18:05] The tax code the way it's written the United States with the 1031 exchanges in the ability to take a property grow it and then take that and put it into the next investment without getting the hit,

for the capital gains is a game-changer yeah absolutely every time you exit a stock,

right what are you doing you think Applegates the powder of a dry powder the investment opportunity assets that you have to reinvest.

In real estate it doesn't work that way,

digital Advantage is also from a depreciation,

I stand here before you not as a failure in taking my own advice on this because I really didn't understand the power of real estate when I was younger.

Over estate really diving into it and understanding it and how you can build wealth over decades.

Don't avoid it look at it understand it study it become an expert in it for men to slim yeah it is a lot of

is a wealth of information I but I've done some I'm always do you know you tell if my people formers are always learning always I'm always learning am always expanding you know.

I've always believed in that I've always done that my entire life and I.

[19:23] Real estate too and there's a lot of information out there now so easy to research now.

Sir I know I'm an old guy you know how to go to the library to get information books that I read and now it's.

He's going to phone logs everywhere these experts everywhere this forums there's podcast videos.

[19:53] That's my advice on on wealth-building continue to feed that monster every month...