If Your Business is Not a Star, You Need to Make it a Star or Get Out.
If Your Business IS a Star, You Can Experience the Exhilaration of a 10x, Even a 100x Spike By Making it a SIMPLIFIER.
Today, Richard Koch explains why the vast majority of businesses never grow bigger than saplings…
And why an elite few go Supernova, toppling towers, crushing competitors, shifting paradigms, redefining markets, gushing hundreds of millions of dollars of profits.
Hint: the Secret is not
From: Perry Marshall
Wednesday, August 23, 2017
Dear Marketing Professional,
In 2014 I held a now-legendary seminar with fractional billionaire Richard Koch. It was called “The Star Principle Seminar.” Admission was $7500. It was the most spoken-of high-end event in the marketing space, attracting entrepreneurs from across the globe. Koch (his name rhymes with “gosh”) did not disappoint. People still rave about the daring strategies he shared. Strategies which have propelled Richard’s own net worth from $214 million to $373 million in the last two years.
Simplify: How the Best Businesses in the World Succeed
On day two, Richard explained THE key differentiator that causes the elite 5% of businesses to earn almost ALL the profits, leaving everyone else to fight over the scraps. It’s called The Star Principle, the subject of his book by the same title. In essence: You must be #1 in a market that’s growing at least 10% a year. If not you must invent your own sub-niche in that market and dominate it, the same way I myself have been teaching people to dominate their markets in Google AdWords for over 10 years.
If you’re not a Star or Cash Cow, as defined by Richard’s ingenious formula devised by Boston Consulting Group…
If you’re smart, you will move heaven and earth to make your business a Star.
But that was just the appetizer.
Because on day three, Richard delivered his knockout punch: SIMPLIFY. SIMPLIFY is the golden thread that connects and explains nearly every market disrupter in history.
Richard Koch is the 435th wealthiest person in the UK, according to the Sunday Times of London “Rich List.”
SIMPLIFY explains with elegant beauty the raging success of McDonalds, Ford, Google, Facebook, IKEA, Southwest Airlines, Uber, FanDuel, InfusionSoft, Starbucks, Apple Computer, Dell, Microsoft, Sony, Amazon, EBay and Boston Consulting Group.
(Not only does SIMPLIFY explain the success of businesses, but it also explains the success of the world’s most influential ideas: Christianity, Marxism, Darwinian evolution, gravity, E=MC
SIMPLIFY explains why, if you’re stuck, you may never get unstuck until you radically re-shape your paradigm and your very criteria for success.
SIMPLIFY explains why, even though Google was not even close to being a “Star Business” in 1999, they went on to captivate and transform an entire burgeoning industry in 2003 and go on to become King of the World Wide Web. (There may yet be hope for you.)
SIMPLIFY explains why 95-97% of companies languish in a Groundhog-Day like existence of redoubling their efforts, undertaking all manner of training programs, seminars, systemization, kaizen continuous improvement efforts, trying harder, leadership training, product redevelopment, culture definition, massive investments and even electro-shock therapy, yet never really achieving breakthrough.
SIMPLIFY explains why simplification is complicated, and why most people are trying to simplify the wrong things.
Henry Ford, contrary to popular legend, did not invent the automobile. There were dozens of other auto manufacturers. They all made costly vehicles for geek hobbyists, mostly well-to-do men who liked to tinker. Cars at the time cost a couple thousand dollars (a hefty sum of money at the time). They were notoriously high maintenance and difficult to use.
Ford resolved to make automobiles affordable for everyman – so that any person earning a decent living could afford a car and take their family to enjoy the beauty of “God’s wide-open spaces.” He invented the modern assembly line, changed the chassis from wood to steel, developed Vanadium steel which was far stronger than anything else at the time; he standardized on a single model and in five years drove the price of his cars from $1500 to $360.
When he slashed the price 75%, sales didn’t go up 75% or even 300%.
Sales went up SEVENTY THOUSAND PERCENT. Sales multiplied 700X, and a company that was NOT the first, NOT the best, NOT the most prestigious, became the #1 car manufacturer in the history of the world. Ford remains one of the preeminent car manufacturers today.
Richard calls this “Price Simplification.”
Marketers in particular have a hard time understanding this. Most people in “our corner of the marketing world” innately resist price reduction strategies because we perceive it as “bad positioning” or “race to the bottom” or “whoring up the market.”
But that is where a clear understanding of SIMPLIFY is needed to clear the confusion.
SIMPLIFY is not “race to the bottom.”
Price Simplification is re-designing the product and/or business process so that, instead of shaving pennies, you reduce the cost by 50% to 90%. In many markets, a dramatic fundamental price reduction will open up all manner of new applications for the product, literally creating a new market where none existed before.
The market doesn’t grow 50% or 100%. It grows 10X, even 100X or 1000X.
This is the real secret to “hockey stick” growth.
This kind of thinking is completely foreign to most “positioning conscious” marketers.
Richard, in defiance of conventional wisdom, insists it’s not so much the quality of the management team, the company culture or the skill of the players in the business. It’s 1) choosing the right market to play in to begin with, and 2) executing a true SIMPLIFIER where the business process or product has been so fundamentally redefined that the world around it cannot help but re-arrange itself around this new, wonderful thing that has come to pass.
Uber is not an incremental improvement of taxis and limousines. It is a fundamental re-invention based on a completely fresh business model. Richard’s colleague, venture capitalist Greg Lockwood, points out that today in San Francisco, Uber is already ten times bigger than the cab industry ever was. I estimate Uber will continue to grow ten times bigger than it is right now before it begins to reach its limits.
Please pay close attention, because this is a billion-dollar secret. Only people who attended my landmark Star Seminar with Richard in 2014, or purchased the DVDs, will fully grasp the term “SIMPLIFIER” in the exact way Richard uses it. While I can’t fully do justice to the SIMPLIFY principle in a short missive like this, let me outline more of his model in broad terms.
The SIMPLIFY ingredient is vital if you want to achieve massive success and eclipse all those who have come before you.
Ford was a Price Simplifier. But there is another kind of simplifier.
The other type of SIMPLIFIER is a company that takes something ugly, unwieldy, messy and complex, and makes it drastically easier and more joyful to use. (There’s another, completely different kind of simplifier, but that is beyond the scope of this conversation today.)
Below you see four kinds of technologies. Read this box starting from the lower left and go counter-clockwise:
1) You see a calculator on the lower left. Think 1976, when calculators were the coolest thing ever. A simple, useful computer. If you’re sophisticated, you buy a scientific calculator instead of a regular one.
Simple and somewhat useful.
2) You see a superminicomputer (“VAX”) on the lower right. A computer could do quite a bit of stuff back in the day, especially compared to pens and pencils, slide rules and calculators.
Much more useful, and very complex. You needed special staff just to run the thing. It’s not like you could order one, put the box in your secretary’s office and expect her to start using it this afternoon.
3) You see Microsoft Windows on the upper right. “A computer on every desk and in every home.” It was clunky but did the job. Ultimately PCs came to do far more than the old mainframes ever did. But Windows is messy. Sometimes you need an IT guy just to install stuff and straighten out problems.
Windows is very useful and very complex. How old does a kid have to be to effectively use Windows? Probably 7 or 8. Maybe ten.
4) You see an iPad on the upper left. You can do 80% of the things with an iPad that people do on Windows, but the iPad is only 20% as complex. My daughter Zoe was effortlessly using an iPad to play games and watch cartoons at age 2½.
She would never be able to use Windows that easily. Microsoft never even aspired to make Windows so simple.
The iPad is VERY useful and VERY simple. The iPad is a SIMPLIFIER.
“Art/Utility” is what the product does for you, and how beautifully it does it. The higher on the scale, the more of a joy it is to use the product, and the more it does.
Please listen carefully, because the principle I’m about to explain is a major key to achieving huge success in business – on the level of InfusionSoft or FanDuel or even Apple. You can be moderately successful without becoming a SIMPLIFIER; you can be a Star without being a SIMPLIFIER.
But almost every huge success story in business is one kind of SIMPLIFIER or another.
Simplifiers ride the SKINNY RED ARROW.
Rather than clawing their way up through the ranks like everyone thinks you’re supposed to do, they bypass the chaos.
Back to my sketch above.
See the curved arrow pointing to the upper right? It shows the natural evolution of technologies. Calculators naturally evolve into complex Windows machines with hundreds of menus, software drivers, utilities, accessories, third party solutions, etc.
It takes lots of work to add that functionality. Millions of man-hours. But once the foundation is in place, the marketplace will take over. People will write the software and add the features naturally.
The machine will grow more and more complex and more expensive until eventually the complexity becomes unmanageable. Which is why even a small company needs an IT professional on hand to keep Windows working.
We all know what it feels like when complexity grows unmanageable.
The fat arrow illustrates the natural, almost automatic tendency of suppliers to add complexity and functionality to the product. This happens in every market. Basic microwave ovens become ornate models with hundreds of menus and features. Coffee makers evolve into elaborate German-made espresso machines.
Windows automatically gets more and more complicated. It is the wide road that leads to destruction.
The thin arrow – the one that points to the left – illustrates the UN-NATURAL, contrarian drive of the SIMPLIFIER. This is the narrow path. SIMPLIFIERS leap past a huge chasm, creating a product that is sensational, almost irresistible. Even people who want to hate it still buy it.
The cab driver takes an Über when the transmission in his taxi conks out.
All of Apple’s offerings are SIMPLE. (Even as they conceal enormous complexity from your view.) They only achieve simplicity through highly concentrated, profoundly deliberate effort. Apple is a SIMPLIFIER. That is why they’re worth $700 billion.
I was listening to a podcast the other day. A pastor was talking about his Apple watch. The band on his new watch needed to be adjusted. He thought “Well I guess I have to go to the jewelry store and have them adjust the band…” but then he thought, “Hey wait a minute, this is an Apple product and Apple doesn’t make stuff that way.”
“Apple makes stuff you can adjust yourself because it’s simple.” When a company’s simplicity is an object of sermon illustrations, you know they’re driving the culture.
InfusionSoft was a SIMPLIFIER. They took something that, back in the day, could only be achieved through complex manual labor, databases, stacks of paper, secretaries and spreadsheets – and blended it into a single software package that managed customer contact information, sent emails, took online orders via credit card, sent faxes, managed highly complex campaigns, tracked opens, unsubscribes, etc.
Remember: before InfusionSoft, nobody combined all those features into one place. And let’s admit it, putting all that together and supporting it was a bitch. Not an easy business.
Also note – other people have come behind them and also do what they do. But InfusionSoft was first! They were #1 in a fast-growing, hungry, rabid market. By being a SIMPLIFIER, they created a market where frankly none existed before. There was no “build and manage complex direct marketing sequences” CRM software in 2002. Only programs like Goldmine, ACT and 1ShoppingCart.
Once established, it became almost impossible for anyone to displace them. You could knock off InfusionSoft, but you could never replicate their installed base or momentum.
FanDuel, who also grew up in Planet Perry, is also a simplifier. Nigel and Lesley Eccles came to my Economic Comeback Seminar in London in 2010. They rode the train down from Scotland. They were in the Fantasy Football business, tremendously simplifying what had previously been around for 40 years.
FanDuel is now a privately held billion-dollar company, a “Unicorn” in Venture Capitalist parlance. Their ads are on every sports station and sports bar and they’re growing like kudzu.
These examples today are tricky because only one side of the equation is simple – the OUTSIDE, which is the customer experience. The INSIDE – figuring out how to deliver the simple customer experience – is devilishly complex.
Nevertheless, please understand that discerning how so SIMPLIFY on a grand scale is not even $10,000 per hour or $100,000 per hour work. It is $1 million per hour work.
I’m better at spotting early potential now than I was then. It’s because my mentors are better. Richard Koch keeps asking me, “Perry, what $10 billion company can we start?” I now know 1% of my customers hit the INC 5000 list multiple times, or raise huge amounts of capital, or go public, or make some other “unicorn” level achievement.
When I first started teaching Google AdWords, nothing on the web had been “long lived.” I estimated the whole AdWords thang might last six months. I did have a vague premonition that it might become a juggernaut like Ebay, but I couldn’t clearly see how the “Network Effect” applied to a search engine, the way it does with an auction site.
I witnessed Google grow up, too. The first time I talked to them on the phone, they couldn’t have had more than 100 employees, and when I visited them in person in 2006 and met Marissa Mayer (she is now CEO of Yahoo!), it seemed like everybody was half my age. I was 37.
I remember when someone I greatly respected pronounced Google to be a ship of fools for buying YouTube for $1.8 billion.
Now Google is doing $70 billion and InfusionSoft is over $100 million. And YouTube is the 2nd biggest search engine in the world.
From small acorns, mighty oaks grow. And grow.
Had I known then what I’ve learned from Richard Koch over the last two years, I could have predicted their success long ago. No, I’m not talking about a crystal ball or time travel. I’m talking about two very reliable indicators for predicting the success of any company.
FanDuel and InfusionSoft both had two things in common that bequeathed billion-dollar potential:
1) They were both Star Businesses. They were both the #1 players in steamy hot growing markets. They captured that lead early and held that lead as the marketplace was organizing itself, finding itself, defining itself.
Planet Perry members who have followed my work with Richard Koch and read his book, The Star Principle, understand this. They understand that only 5% of companies are stars, and stars are the only ones you want to work with or be in. Small companies only grow and prosper if they’re Stars.
2) They were both SIMPLIFIERS.
Consider FanDuel. Fantasy Football had been around since the 1960s. The first Fantasy Football league was organized in Manhattan in 1962. Three guys from Oakland California founded it in New York and it was called “Greater Oakland Pigskin Prognosticators League.”
But Fantasy Football was still obscure enough in 2010 that I didn’t know what it was when I met Nigel and Leslie. I admit I’m a total idiot when it comes to sports (it’s a running joke among my staff), but it wasn’t as if Fantasy Football spots were appearing on every single commercial break for NFL and ESPN. Not back then!
I interviewed a Fantasy Football “early adopter.” I asked him, “What was Fantasy Football like years ago?” His reply:
You had to wait until the next day to even know if you won your matchup or not. By far, the worst part about playing fantasy football way back when was that you needed a computer to play. You never knew your lineup or your matchup score or standings at any given point. Good luck if you tried to start a public league. No one would join your league and you were out of luck. Everything was slow and the overall experience was horrible.
Today, you have live updated scores, you have your league standings, your matchup scores, your lineup all in the palm of your hand. The best part is, if you don’t want to find ten people to play with, just join a league alone.
With sites like FanDuel and Draft Kings, you can join thousands of leagues for free, or for a fee with people you don’t know. You can simply sign up for any number of weeks at your choosing. You don’t need to be committed like in the past, you don’t need to stick with the same old team you’ve had all season. And when someone isn’t performing, you just dump him and move on. It’s a completely different feel and is so much better now.
The biggest benefit today besides having your lineup on you at all times, is the fact that you don’t need to know anyone. You can play at any time at the drop of a hat. Now I can watch my live updates, talk smack on the fly, and overall can be 100x more connected than when I first started.
FanDuel made Fantasy Football infinitely easier and more accessible. Their menus crunch statistics for you, so access to anything you want to know is only a few clicks away.
Don’t forget they also had a pile of legal hurdles to also overcome; they’re still battling jurisdictions in various states and countries, like the state of New York.
1) Richard’s current net worth numbers factor a discount based on FanDuel’s current legal battles. Some might argue for higher numbers but he’s being conservative.
2) Richard tracks his net worth in British Pounds. At the start of 2014 it was £135.8 million; at the beginning of 2016 it’s £236.3 million. My US Dollar numbers today are based on a fixed exchange rate of 1.58 dollars per pound, a number which has fluctuated continuously.
3) Had I been offered a piece of FanDuel, I still may have passed. I’m not personally enthusiastic about “grey area sports wagering”; I declined to take shares of a casino technology company a few years ago. None of this negates the Star Simplifier potential of FanDuel though. The growth and market domination principles remain.
FanDuel’s SIMPLIFY strategy created the mania (network effect, in business jargon) of bringing millions of fans together to butt heads.
BANG! Billion-dollar company.
FanDuel was and is a SIMPLIFIER.
SIMPLIFIERS radically expand markets. Today, any reasonably sophisticated online business demands InfusionSoft or something like them. Twelve years ago hardly anyone was thinking about it. They were only complaining about how hard it was.
SIMPLIFIERS create markets where none existed before. Or if the market does exist, they generate 10X more demand. Case in point: Ten years ago YOU owned a computer. Now you own a smart phone AND a tablet. Each of your kids has one too. And the smart phone is probably an iPhone and the tablet is probably an iPad. Right?
SIMPLIFIERS unearth new applications for their product that nobody ever considered. You now see iPads functioning as cash registers at kiosks and coffee shops. You see them running displays in museums. In factories they control automated equipment. Yep, 2½ year old Zoe can watch a movie on her iPad and the same iPad can control the oven temperatures in a bakery.
That’s why SIMPLIFIERS add heaps of equity into their net worth, while everybody else wonders what’s going to happen next.
Only 5% of businesses are STAR Businesses. Only a fraction of those Star Businesses are SIMPLIFIERS. And while SIMPLIFIERS never simplify by accident, most SIMPLIFIERS are operating without a larger global plan. FEW are fully conscious of what they are doing. Most are working from blind drive instead of clear objectives.
If your business is not a Star, you need to make it a Star or get out.
If your business is a Star, you can experience the exhilaration of a 10X, even a 100X spike by making it a SIMPLIFIER.
If your business is not a Star, you may be able to MAKE it a Star by executing the right SIMPLIFY chess move.
Consider Apple in 1997. Apple was not a Star. They had a burgeoning product line, the guy who used to run Pepsi was trying to make it work, and they were gasping for breath. Steve Jobs came back and slashed complexity, sharpened the focus and began to SIMPLIFY the entire business. Apple went from certified DOG to STAR SIMPLIFIER in a few years. And then the revolution began. (Pay attention: SIMPLIFY can get you from Dog to Star in a year or two.)
Rather than clawing their way through the crowded “features and CPU speed” market, they began selling art and utility and elegant simplicity.
Do you have a formula for selling art and elegance instead of “features and CPU speed”?
And… if your business already is a SIMPLIFIER, what would it be like if you had a guiding hand and Grand Strategy?
Those who love riddles will make SIMPLIFYING their lifelong passion. A rabidly addicted and passionate SIMPLIFIER becomes a very wealthy serial entrepreneur.
Somebody in Planet Perry will be a billionaire some years from now, because they read this story and chose to be a lifelong simplifier.
And be warned, because there’s also a dark side.
Are you fat, happy, comfortable and profitable?
Is your business a “cash cow”?
Did you make a million dollars profit last year?
Your business will continue to be successful…
…until a SIMPLIFIER demolishes your market.
In college I took a tour of the McDonnell Douglas aerospace company in St. Louis. I remember an engineer proudly showing us a “Mini VAX” in the corner of his office. A miniature mainframe computer.
Digital Equipment Corporation made that thing. DEC doesn’t even exist anymore.
It is inevitable that a SIMPLIFIER will charge into your market, not attract too much attention at first, transform itself into a Star, then suddenly demolish everything in sight.
When Google started, it was not clear that it was a Star Business! If I enter the Google of 1999 into the Star Principle Scorecard (max is 200 and 100+ is a star), Google of 1998 gets a Star Score of 38.
Nobody took Google seriously at first. I remember hearing about Google maybe around 1999, and never being able to remember the darn name of the thing for awhile. They brought up the rear in the search engine wars. They offered their technology to Yahoo for $1 million, and Yahoo turned them down.
But they were a SIMPLIFIER. Their clean white home page was just a hint of a wider philosophy. If you were seriously hunting for anything, you found it twice as fast with Google. Every time. So despite having no revenue model, a stupid name and coming late in the game, Google eventually eclipsed everybody. All the world’s information – fast – by typing words into a tiny box on a white screen.
They demolished Hotbot, Excite, AltaVista, Lycos, Infoseek, MSN, Yahoo!, Ask Jeeves, Overture, everybody.
In other words, even if your business is a dog, a rifle-shot, laser-focused SIMPLIFY strategy can catapult you to greatness.
Über is a SIMPLIFIER. See how Über is demolishing the Taxi and Limo business?
If You Don’t…They Will.
Richard Koch instructs:
“In the early 1960s, Fred Smith wrote a paper for his economics prof at Yale suggesting overnight delivery for courier packages. Folklore varies – some suggest the professor gave Smith a C grade, while others have the professor saying to get a C, the idea had to be feasible. In any case, nobody in the industry at the time thought up the idea, and it was left to Smith to create Fedex.”
Fedex was a SIMPLIFIER.
Richard continues: “IBM and DEC were the leaders in computers, and Wang was the leader in word processors, but none of them ever profitably made a personal computer. Steve Jobs and Bill Gates were the new kids on the block who disrupted and hugely enlarged the computer industry. Jobs also transformed five other industries: animated movies, music, phone, tablet computing, and digital publishing.”
Gates and Jobs were SIMPLIFIERS. They were also outsiders.
Richard admonishes: “The leading online business in every segment is different from the previous offline leader. No bookseller conceived of Amazon. No established betting company devised a betting exchange. Nobody in the minicab or taxi industry invented Uber. Nobody in hotels came up with AirBnB. In science and business, revolutions come from outsiders. You could be one of them.”
At the Star Seminar in 2014, Richard ranked the entrepreneurs in the room using the free tool at StarPrinciple.com – where you can score your business from zero to 200 points. Anything over 100 is a Star. (You should take this test now.)
He invited all players with scores above 150 to the front of the room. Nine took the stage. We put their stats on the board and he started quizzing them.
Within 45 minutes it became clear to all that a number of Planet Perry businesses have clear potential to exceed $100 million, $1 billion, even $10 billion or more.
It was a lightbulb moment for me because nobody in the “internet marketing” space thinks this way. People seldom realize they’re sitting on billion dollar businesses. Acres of Diamonds, as the old-timers say.
Most gurus are content to squeeze $2000 from these same businesses in a product launch… then just cruise right on by.
I’ve made that mistake before. I won’t make it again.
FanDuel had fallen off my radar completely, until Joel Runyon, brought them back to my attention. “Hey Perry! Remember that fantasy football guy from London? Those guys just got $70 million in venture capital!” Richard himself had put money in, completely independently of any influence from me. Our two worlds had converged at yet a different point.
How many other billion dollar businesses are waiting in the wings, with their potential unrecognized?
I didn’t get a piece of FanDuel. I do own a piece of InfusionSoft though. I’ve been on their Board of Advisors for most of the last decade.
There are numerous billion-dollar businesses in Planet Perry right now, waiting for their potential to finally be unearthed and exploited. I estimate there are at least ten among us at this moment – billion dollar businesses waiting to explode. Nancy Slessenger’s recruitment agency is capable of exceeding a hundred million. A couple of nutrition businesses in our midst also have potential to hit a billion. And numerous Software As Service companies. Right at this minute.
Donny Wyatt’s Co-Construct may or may not be a billion-dollar play. But it’s a 150+ point Star, it’s a Simplifier, and he will someday sell it for many, many millions of dollars.
I don’t know how many more Star Simplifiers are one degree of separation away from me. But they’re in our midst.
SIMPLFYING Is Not Simple.
If it were, everyone would do it.
Actually, it’s almost impossible to do from the inside.
SIMPLIFIERS are always obvious after they emerge… but never before.
There are at least 10,000 cab drivers all around the world who COULD HAVE invented Uber. They knew how to program, they knew how to hire programmers, they could have hired someone to create the app; some of them had rich friends or relatives who could have financed the beta version, and they all had enough reasons to come up with something better than making 15 bucks an hour driving a cab in New York City or Tampa or Cairo.
But they didn’t.
Uber was created by Travis Kalanick, a total outsider.
It’s almost impossible to re-invent from the inside out, because a fish in water can’t see the water for what it is. This is why
SIMPLIFIERS and industry disrupters almost seem to be fortuitous accidents, serendipities, things people stumbled upon. It’s why they take meandering paths and often end up very different than the way they began.
Simplifying a business is surprisingly difficult brainwork. It’s rare you’ll be able to do it yourself since you’re invariably too close to your situation.
Any number of taxi drivers could have invented Uber, but none did.
But it’s still possible if you secure the right help. And if you don’t SIMPLIFY, somebody else will. And all your kaizen continuous improvement, all your yearnings and meanderings, all your education and efforts to reform your culture and systemize your business will be for naught. Because some outsider will come in like a bandit and clean your clock.
All the vain efforts of the taxi industry are for naught. Even in the most corrupt cities (like Saint Louis), the politicians and the taxi lobby can’t stop them from coming in. Because people want Uber and it’s an unstoppable force.
It’s either YOU or THEM that initiates the change.
And odds are, you need outside help to see this happen.
Have you ever seriously considered whether YOU have the potential to cross the $100 million, $1 billion or $10 billion mark?
You should be asking yourself this question. Because I’m looking for needles in the haystack.
Richard is looking for needles in the haystack.
I’m engineering “Planet Perry 2.0” to be a magnet and incubator for billion dollar businesses. Are you one of those needles? Do you have billion-dollar potential?
If so, we’d like to have a private and completely confidential, personal conversation with you.
There are BILLIONS of investment dollars sitting on the sidelines. The inability to SIMPLIFY is one reason why.
With Richard’s astonishing investment returns in mind, consider this:
1) You, as a small business, probably borrow money from credit cards at 15-25% interest, and even though lots of people pay that off, many others don’t. They just carry the debt.
2) People who want to invest their money in a bank or CD get shameful rates of return like 2.5%. Even though there are lots of small businesses that would be thrilled to borrow at 10-12%.
3) There are TRILLIONS of dollars sitting in bank accounts earning 2%, investors searching far and wide for good investments; more trillions earning 3-5% in the stock market, and often losing money.
So why the disconnect?
I’ll skip the rant about government regulation for now, and just focus on the business problem. Which is:
Capital, all by itself, is nearly useless without DISRUPTIVE ALCHEMY BUSINESS STRATEGIES AND PRODUCT CONCEPTS. If you don’t have a killer product that has an intrinsic, innate Definitive Selling Proposition (and not just a gussied-up clickbait headline churned out by a slick copywriter)… then all the capital in the world does you no good.
Which is why there are millions of entrepreneurs who desperately wish they had some capital to grow their biz, yet at the same time there are millions of investors with trillions of dollars stuffed under their mattresses. The two sides can never seem to match up.
The closest thing I’ve ever seen to an algorithm for disruptive products is Richard’s SIMPLIFY model.
Richard and I are vetting future SIMPLIFIERS, roving the haystack in search of needles.
If you meet our criteria, we can begin an exploratory conversation.
What are the criteria? In broad strokes, they are…
- Star Principle score greater than 100 points – preferably 150 or more. Go to StarPrinciple.com and score yourself right now.
- You’ve gotten past “startup.” You’re not just a guy with an idea on a napkin, not just a product with no customers. You’re off to the races with a running business. Clate Mask in 2002 (“will write software for food”) would not have qualified. Clate Mask in 2004 would have qualified (“ManagePro CRM was selling to a hot rabid niche.)
- Either a) you’ve figured out a way to tremendously simplify the customer experience, the way iPads are simpler than Windows, or b) you’ve figured out a way to drive tremendous cost reductions by fundamentally re-defining the product and/or business process.
Where are we headed with this?
Richard and I want you to reach $100 million ON PURPOSE instead of ACCIDENTALLY. We want to speed you past the roadblocks and land mines that stand in the way of billion dollar companies.
And just like Richard partnered with FanDuel at an opportune time, securing bedrock personal interest in their success and bringing much-needed value to their organization, we likewise may equity partnership in YOUR success.
Keep in mind, Richard has only taken equity in 19 companies in 25 years. One deal every 16 months on average. Richard is very selective about where he puts his money and even more stringent about who gets his time.
And as you know, he’s really good at picking winners. He’s made 6X to 50X on his money nine times out of nineteen.
If you’re a match, it isn’t going to happen in a single meeting or stroke of a pen. We have a system in place. Every step of the way is going to benefit you. And you’ll have skin in the game.
The goal is for both of us to have skin in the game, and to make your needle in a haystack into a rising star like FanDuel or InfusionSoft.
If you are smart, you are extremely cautious about giving anybody a stake in your company. You’ve poured your blood into this thing and it matters. My old boss Mike clung to every percentage with an iron fist. Equity is precious.
And again Richard is equally selective about the winners he picks. So we’ve designed a disqualification process that delivers value. Even if you get a “D” report card you’ll get solid, actionable insights and recommendations on how you can make immediate improvements. This is not pass/fail. You get a detailed analysis of your situation.
The 90/10 world where winners take all brings even bigger advantages to Star Simplifiers. Do you have the potential to become another InfusionSoft, another FanDuel? I want to find out.
In 2014, Richard Koch’s Net Worth was $214 Million. Today, $373 Million.
Net worth is up 43% in the last 12 months.
In a year when most asset classes have been flat or down, including the stock markets, bonds, and hedge funds, that is not too bad. These stated valuations are very conservative, partly because the increase is so high.
Much of the increase has been driven by Auto1, the European used car online platform which is a stunning Star and SIMPLIFY business. Richard chose Auto1 for its simplicity and elegance. It is the fastest growing business in Europe at the moment, and is now worth well over a billion dollars in the latest round, which was March 2015. (Even though it does not feature on “unicorn” lists.)
I know hundreds of authors, speakers, gurus, investors. I’m friends with a few billionaires. I don’t know of anyone with a more elegant strategy and cleanly articulated business philosophy than Richard. I don’t know anyone whose success model is simpler.
I don’t know any wealthy people who work less, or who intellectually produce more.
This year he’ll likely place in the top 500 wealthiest people in Britain on the Sunday Times of London Rich List. Last year he came in at #539.
When a Venture Capitalist (“VC”) invests in TEN companies, they expect seven to go belly up, two to do OK and one to explode 10X. VC’s are the fraternity that gave birth to Facebook and Google. Those guys make billions of dollars this way.
Even the best are still lucky to bat 10%.
When he told me he hit $373 million, I said, “You’ve been working hard, Richard.”
He replied, “Not hard at work, dear boy, just hard at thinking.”
The reason I’m writing you today is:
Richard is assisting me in the selecting, grooming and LUCRATIVE EXIT of a handful of exponential STAR SIMPLIFIERS.
Every year, a $100 million oak tree emerges from a Planet Perry acorn. Sometimes $1 billion. Long-time client Charles Howson from the UK sold his company just a few years ago for close to $100 million. I have a client in Australia who will go public some time in the next year or two for a valuation of many tens of millions. I have a Private Client Group member who I predict will sell his company in the next 2-3 years for over $100 million.
Because this isn’t lottery ticket territory. This is realistic chance with correct strategy territory. This is also opportunity to course correct and put yourself on the right trajectory territory. It means the mere fact that you’re reading this letter places you in close proximity to large fortunes which are growing up all around you.
And since your income five years from now is going to be the average of your five closest colleagues, then even if you’re still figuring it out, you’ve got a chance. You’re hanging around the right tribe.
Richard and I have designed a STAR SIMPLIFIER SCORECARD, which gauges your chances of hitting $1 billion in the next five years. We are issuing you a scorecard on a custom, individualized basis with Perry S. Marshall & Associates administering the process.
The Star Simplifier Scorecard judges your business growth potential on 21 highly specific criteria. It has a maximum of 100 points. Over 90 points = billion dollar potential. Over 80 points = $100 million potential. Over 60 points = $10 million potential.
Most importantly, it points out 1) the specific areas where you are weak and vulnerable, and 2) the strength areas which you MUST continue to capitalize on in order to achieve consistent growth.
A small number of scorecard takers will be further eligible to become paid clients of our SIMPLIFY process. Much of this will depend not only on your business, but you – how we feel about working with you, what it’s like to roll through the Scorecard process.
For all those well familiar with “take away selling” this is not a “take away sell.” Take-away selling is fake. This is real.
Richard will not accept any client unless he sees serious LARGE potential. Richard is NOT doing this for the fee we charge. Nor is he doing it for the much higher consulting fees of a full engagement.
Would you do consulting at ANY price if your net worth rose by over $150 million in the last two years?
Richard isn’t interested in your money. He’s hunting for future billionaires. Needles in haystacks.
A few will be eligible to go forward beyond the initial scorecard exercise. But here’s what you get regardless of what comes next:
- Detailed feedback for your company regarding each of Richard’s 21 criteria for the SIMPLIFY Matrix, a guide for significantly accelerating growth over the next two years
- Specific recommendations for you to act on immediately
- We will disclose the bottlenecks that are most likely to slow your progress in the next stage of growth (removing these can make growth come much easier)
- Richards SIMPLIFY Manual for Entrepreneurs
No event I’ve ever organized has received so many rave reviews as the Star Seminar – and the raves continue to come in more than a year later.
People who came to that seminar still tell me it utterly changed their paradigm. From Megan Macedo, who might have been the smallest player in the whole room at the time (it directly inspired her “Be Yourself” business which is now blossoming to her great delight) to Ed Harycki, a high-cotton MBA-style corporate player from Connecticut. Ed is growing an exciting Star SIMPLIFIER in the banking sector.
You should plan on taking 5-6 hours to fill out our detailed questionnaire. We will conduct several interviews with you and your key team members. You will receive the questionnaire shortly after we receive payment.
The questions alone are worth ten grand.
Again, a few of those who receive their SIMPLIFY scorecard will be offered an opportunity to work with our company directly, receiving ongoing guidance on your way to $100 million, $1 billion and beyond.
You could spend tens of thousands of dollars on seminars, masterminds, plane tickets, hotels and meetings and you would never get nearly as concise or applicable direction as you’ll get from our dense, customized SIMPLIFY evaluation of your company’s prospects for success.
Be warned: Richard is polite because he’s British. But he’s blunt and does not mince words. We will be frank with our recommendations. We will not tell you that you have a beautiful boy if in fact your baby looks like a troglodyte. We call a spade a spade.
If your baby is a troglodyte, best to find out now. (Your baby’s probably not ugly. But your baby has vulnerabilities. We all know that.)
Please keep in mind: This will not give you direct access to Richard. Even if we take you on as a billion-dollar potential client, you still will not get direct access to Richard.
In all cases you will be working with me, Perry Marshall (to a lesser degree), and my team (to a greater degree) who will be executing the STAR SIMPLIFIER plan that Richard has designed.
Richard treats his time as if it’s worth over $100,000 per hour. (Do the math – at $158 million growth in two years, it’s worth more than that.) One of Richard’s conditions for creating the SIMPLIFY company with me was: No client meetings, no webinars, no seminars, no speaking engagements, no groupies, no phone calls, no Skype, no visitors.
(This is why Richard and I didn’t come out with some “package” or “offering” or “deal” after Star Seminar. We didn’t sell a product at the event. There was no upsell. Why? It’s not that I wouldn’t have liked to. It took over a year for me just to carve out something that would fit Richard’s increasingly narrow parameters.)
Richard is extremely protective of his privacy. All communication with Richard must pass through me. He even declined my offer to visit in December 2015 while I was in London with my son Cuyler. He’d already had numerous guests. He’s working on his next book, which is not a business book, and he eschews all distractions.
So you won’t get to be Richard’s newest friend. But if you’re accepted, you get access to his mind, his formula, his process. A process that’s grown his net worth by eight figures in two years. A formula that took him from working stiff to fractional billionaire in 25 years.
80-90% of applicants will not be accepted for ongoing consulting. But please understand this is not just an application to consult with a company founded by me and Richard. The SIMPLIFY Scorecard adds X-Ray vision to your current plans. The SIMPLIFY formula is genius and the finished report and recommendations will guide you past the quicksand that most companies get stuck in.
Most $1 million companies never make it to $2 million. Most $5 million companies never make it to $10 million. But all $100 million companies surpassed $10 million and $20 million.
If you’re not accepted, you will still have, in your hands, a plan for driving forward and breaking past the barriers in front of you.
We execute Star Simplifier in three stages:
Stage 1: Initial screening written application and telephone consultation.
Stage 2: If you’re eligible for the SIMPLIFY Scorecard (this typically requires revenues of $0.5 million+ and realistic possibility that your company could surpass $10 million+), we commence the SIMPLIFY Scorecard evaluation.
We will mail you a proprietary SIMPLIFY Action Pack. The kit also includes a CD / DVD from our $7500 Star Principle seminar titled “The Grand Synthesis.”
The SIMPLIFY evaluation includes detailed questionnaires. Plan on one full day to respond to our questions. You will receive a set of SIMPLIFY guides. You will need to read the material and watch the DVD. Once you have completed the reading and watched the DVD, we will schedule a series of telephone interviews.
Important parts of the SIMPLIFY Scorecard is done verbally via phone or Skype. This is not just “filling out a form.” We will analyze and process the data we’ve received.
30 days after the interview process is done (an estimated 45 days from now) you will receive a SIMPLIFY Scorecard that identifies the strengths and vulnerabilities of your business specifically from a Star Simplifier perspective.
The Scorecard you’ll receive is a 10-20 page report of findings that pinpoints the key growth blockers in your business and details the changes you need to make in your product or service offering to SIMPLIFY. It clarifies the most challenging details of making your business a Star Simplifier.
We explain your results via phone. We let you know if you qualify for Stage 3.
Stage 3 is expected to match only 5-10% of applicants. This is a one-year custom consulting engagement where we apply the full Richard Koch / Perry Marshall SIMPLIFY model to your specific business strategy with a detailed quarterly plan. Includes a complete, custom tailored SIMPLIFY road map for your product or service. Includes detailed research and market validation.
Scorecard fee is given after initial phone consultation.
To begin, (screening conversation & written application), click here or call my Client Advisor Josh Thomas at +1 512-536-0799.
Is your business poised for exponential growth? What stands in your way? What tweaks or pivots do you need to pave your highway to success?
It’s time to find out. Answer will come 30 days.
To Your Success,
Frequently Asked Questions:
Q: Will Richard invest in my business?
A: You should not engage in SIMPLIFY consulting based on any expectations or motive of getting Richard to invest in your company. There is a possibility that Richard will invest in a very small number of these businesses much later in the process. Relative to the steps outlined above, such an event would be “Stage 4” or later.
Q: Do I get to consult directly with Richard?
A: You will get access to Richard through the Perry Marshall team. All consulting will be handled through Perry’s organization. We will take questions to Richard as necessary but clients should not expect access to Richard. This is one of Richard’s stipulations on starting the SIMPLIFY company. Your organization will get the benefit of Richard’s analysis and insight as he will receive regular updates about your company’s progress.
Q: Do I get to consult with Perry?
A: I will be involved hands-on in all of the Simplify Scorecard evaluations. I will conduct your phone interviews and deliver most of the report of findings. My #1 role in this venture is “Chief Architect” both for the Scoring and for the full-on $200K+ SIMPLIFY client consulting.
When you come to fully understand the SIMPLIFY model, you’ll see that there is always a part of simplifying that is extremely complex. (The yin and the yang.) My job is to detail all the steps, the exceptions, to perfect the SIMPLIFY algorithm. The goal is to fully extract the formula, the roadmap, that gets companies from $1 million to $1 billion, out of Richard’s head (including the stuff he never bothers to tell people, because it’s in his bones) and codify that formula into a reliable process.
Q: What sizes of companies has Richard consulted with and invested in?
A: When he was with LEK (which he founded; the “K” stands for Koch) he worked with a wide range of clients, from millions to billions. Of the 19 companies he’s taken equity in as an investor, nine achieved tremendous ROI. How many people do you know who’ve been intimately involved in “unicorn” success stories across a range from less than $1 million to over $1 billion?:
|Less than $1m||5 companies|
|$1m to $10m||1 company|
|$10 to $50m||2 companies|
|$50m to $1bn||0 companies|
|More than $1bn||1 company|
Q: What is the screening conversation for?
A: Most companies will be a poor fit for the SIMPLIFY Scorecard process. We don’t want to take your money unless you meet certain criteria.
Q: What does the application process look like?
Q: Are there any refunds?
A: If we accept you for the SIMPLIFY Scorecard process (which is difficult) and after we’re done, if you feel the Scorecard was a waste of your time, and it did not produce insightful information for you, we will refund your payment.
Q: I have a client who would be perfect for this. Do you pay referral fees?
A: Yes we do, and we desire non-competitive relationships with consultants who understand that if Richard’s business formulas could juice up their clients’ product offerings, it would help everybody’s business. If you would like to be a referral partner, contact jeremy (at) perrymarshall.com.
Q: What kind of information will I get in my Scorecard Report of Findings?
A: Some businesses have fundamental, irreconcilable scalability problems. They will never get bigger than, say, $3 million or $1 million. Some products will never achieve exponential growth. Some USPs will never grow beyond a very specific niche market. Some business models are doomed to stay at #4 or #5 in their market and will never do better than that. Which frankly means always struggling to meet payroll, always fighting competitors over the scraps.
Some markets are headed south and will not sustain growth companies. Some potential superstars are not willing to make the investment or discipline necessary to create a truly groundbreaking, blockbuster product. Some can’t see what their market is unhappy about or are unwilling to go the extra mile.
Whatever your roadblocks are, we’ll tell you what they are. Please do not expect a “puff review.” This is truth serum. If Richard doesn’t want to take you on as a client, shouldn’t you want to know why? And of course if you have serious Star Simplifier potential don’t you think someone should tell you? If you should pour the gas on for all it’s worth, shouldn’t you find out right now? If your baby is ugly, we’ll tell you. If she’s beautiful, we’ll tell you that too.
Q: What does SIMPILFY ultimately involve?
A: Ultimately, SIMPLIFY involves the willingness to go the extra mile and build a product that either massively shortcuts the hassle and complexity of existing offerings; or else build a product that massively reduces the cost, through a dramatic re-invention of the product or process.
This is not easy to do. Most do not have the will to do this. Sort of like the Taxi companies could have created Uber (some of the base technology for doing so has been around for 20 years) but they were too lazy, complacent, blind, not self-aware, greedy or whatever.
Building a $100 million or $1 billion company is a pain in the ass. It also comes with GREAT rewards.
Do you want the rewards? SIMPLIFY SCORECARD will show you what it costs to get them.
Success formula: 1) Find out the price of success 2) Decide to pay the price 3) Pay the price.
Q: Is this Marketing Consulting?
A: No. Marketing is commoditized. Now, it’s still a valuable commodity, don’t get me wrong – I know a LOT of marketers who make more money than most doctors and lawyers – but you can find good marketers everywhere. It’s not ridiculously hard to find a guy who can write good headlines or improve your USP or manage Pay Per Click.
What IS ridiculously hard is a killer offer and product definition that wipes out competitors the way Uber is wiping out the cab companies. This is never easy. Richard Koch has defined a meta-strategy for doing this that is better than any I have ever seen. He has been using that strategy to select investment targets and you know how good his track record is.
He is now ready to teach that strategy to a handful of hand-selected clients if Perry Marshall is willing to do the work to codify this into a success algorithm. We are building that algorithm and we would like you to be a candidate.
Join us. First step is scheduling your screening consultation which, all by itself, will show you where you are and give you a roadmap to the future.