Entrepreneur Experience: Mary Grothe, Sales and Growth Ninja
Everyone likes to talk about scale and growth, but few people have dialed in the skill the way our guest on this episode has. Mary Grothe, founder of House of Revenue and host of Revenue Radio, joins us today to talk about how to build a winning go-to-market strategy, what it really takes to scale and grow your company, and the impact of the pandemic on practically every market in the world (and what to do about it). She’s brilliant, passionate, and can sell like no one we’ve ever met… This one’s a real treat!
We all hear about “growth and scale” all the time in the startup world, and most of us know that it’s imperative to getting the win you and your investors are looking for. But what does it really take to scale and grow a company, and how do you know when you’re ready to do it?
In today’s episode, scale and growth ninja Mary Grothe, founder of House of Revenue and host of Revenue Radio, joins us to dive into all the ways that “sales and marketing” is perceived, where we usually go wrong, and how to set ourselves up for success. As a former #1 mid-market B2B sales rep, Mary’s company has absolutely crushed it, helping companies nationwide by leading marketing, sales, customer success, and RevOps with proven, preditable, repeatable strategies that get results: an average ROI of 1,454%!
We talk about how the supply chain challenges and labor shortages brought on by the COVID-19 pandemic have completely changed the reality of sales and marketing strategies for almost every industry and segment. Mary explains how important it is to constantly be re-evaluating your go-to-market strategy, especially in the wake of a once-in-a-lifetime event like the pandemic, because odds are it needs to shift (and potentially dramatically!) to keep up with the shifts in the market. We also talk about the right pace for shifting your go-to-market strategy and what data you need to be gathering, analyzing, and listening to when making these shifts.
We then go into strategies for getting scrappy as a new founder, and talk about the phases of go-to-market, including product-message fit and product-market fit, and how you know you HAVE product-market fit and how to keep it. Mary talks about the challenges of moving from a contractor model to having employees in your business, but also why it’s crucial to your success to get there as soon as you can. And she explains the importance of TRAINED sales managers in leading successful sales teams.
Finally, we broach the subject of work-life balance and talk about Mary’s journey in the first 2 years of her company, and hear her advice for new entrepreneurs (and us veterans) about how to do it “the right way”.
Mary’s journey is inspiring, and her passion is infectious. If you’re ready to grow and scale, or if you are thinking about what to do when that time comes, this episode will set you right!
Check out Mary’s recommended resources:
Revenue Radio, with host Mary Grothe
“The Science of Scaling” by Mark Roberge
All things John Maxwell
“The Hard Thing About Hard Things” by Ben Horowitz
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Straight to you from Denver, Colorado, this is Precursa: The Startup Journey. We share the ins and outs of building a tech startup from inception, to launch, to revenue and beyond. If you’ve ever wondered what building a startup from scratch really looks like, you’re in the right place. With full transparency and honesty, we reveal it all about Precursa on our ride from idea to exit: the wins, the lessons learned, and the unexpected twists and turns.
Hey everybody. And welcome back. This is Precursa the startup journey where you are following our journey from building something, from idea and nothing to a real company, which is very exciting. And today I am so excited because I’m joined by the inimitable Mary growthy. She’s the founder and CEO of house of revenue, a Denver based firm, a revenue leaders who currently lead the marketing sales customer success and rev op departments for 16 companies nationwide as a former number one mid-market B2B sales rep herself. Mary is no stranger to what it takes to build and scale a company for wild success. And she’s done just that with her own company, as well as those of her clients. Mary’s story is one of resilience, passion, and a commitment to excellence, and her faith is truly inspiring. So without further ado, welcome to the show, Mary,
That was a very nice introduction. Thank you for taking care of me under that.
You are so well. It’s so good to have you here today. So why don’t you by just telling us a little bit about yourself, how you became an entrepreneur and kind of what you’re up to
Boy, I’ll start with this shorter version. Otherwise people might get bored and tune out. You said I’m a former top sales rep. That was the bulk of my career. I didn’t have any professional links experience or a college degree when I was 22, but I found through an Adin in the newspaper. This thing people used to use, I found a job ad for a sales assistant position and for a payroll company, which by the way, I knew nothing about what any of that was, but I took the job. They gave me the job. I said, yes. And I had two remarkable years of working underneath the number one sales manager in the country. I got to learn the sales profession inside and out. I started to grow up and learn what I wanted to do professionally, which of course was be in sales. I got a spot on the mid-market team when I was 24.
It was 2008. So it was right when things started to get a little hairy in the market. But I’m very thankful for that. Cuz I got to learn how to sell in a down market, which I think really required me to figure out sales early and not ride any waves. Some salespeople come in when a market is super hot, they ride waves, they have incredible success, but then they can’t repeat that success in other markets or with other products or different kinds of buyers. So I was really thankful to learn how to sell in a down market. With that. I became the number one rep in 30 days in the mid-market and I maintained that title throughout my tenure in selling. I had a remarkable couple of years. My first two years in sales, uh, first year quota was 150,000. I sold 758,000. Wow. And it was just really fun.
I dealt with a lot of adversity going into that role. I was so young and I didn’t have experience and people just could not believe that my manager gave me that opportunity. So I channeled all that and improved him wrong. But I did that for five years and then I got the first like wild hair that entrepreneurial, maybe I could do something bigger than just sell payroll. So I left I one of my clients’ company, it was a startup and that’s also where I just got bit by the startup bug. And I fell in love. The company was 125,000 in annual revenue. They did back office services for small businesses. So think bookkeeping through HR and CFO, it was run by three accountants. So therefore we could all agree. They probably had this room for opportunity with their brand marketing and sales strategy. And that’s what I got to do.
I went on as VP of sales and marketing in seven months, we quadruple the size of the company, uh, put the company in a position to secure financial investment. And at that point I said, I wanna do this again. And started my first company called butterfly creative for three years. I worked as a business strategist, serving entrepreneurs and startups helped them take the vision and the idea and turn it into a go to market strategy helped ’em take it to market. And then I got myself out of there. So I was working very early stage funny though, most startups and entrepreneurs actually don’t have a lot of money. So they can’t pay you super weird. Do you know how many like cap tables I was on and how many like king supers gift cards I was paid in, I was also paid in hope and compliments.
That’s right. Um, and love undying love. We get a lot of that as payment as well,
Like XO XO smiley face. Okay. So then in my starving entrepreneur state, I met my no husband. I went back to the payroll company for three years. Totally crushed it sold millions, broke records, made a six figure commission check that entrepreneur inside of me was just bubbling. Like you can’t work for anyone else. What is wrong with you? Uh, so I took the money, uh, got a house, had a baby and started house of revenue. We started four years ago and my mission back then we were operating under the name sales BQ was to help small business owners build a sales department. And we did that for 18 months. In fact, we built 45 sales departments in 18 months. Wow. And yes, then we had some data and that data showed there was a stark difference in performance and it was 100% consistent. The clients who on their own accord had a great brand and good marketing engine, far outperformed.
I mean, we’re talking five X, 10 X outperformed, the companies who were relying solely on the sales department to produce revenue. So we decided we actually went on this crazy journey. That’s about when you and I met, uh, in tripling in size. Yeah. And we started to bring on experts in Brandy to marketing. We adopted rev ops became a HubSpot partner and partner of 14 other technologies. And by 2020 we just started building these full scale ahead revenue engines for our clients, Brandy marketing sales see us rev hops, all of a sudden, it just a complete game changer. In 2020, we had nine full service clients and we scaled them on average 3.2 million, which is meaningful because these are small companies that we serve. So for most of those clients, we were doubling their MRI within 10 months. And then in 2021, we, we served 10, uh, second stage scale companies last year and we just grabbed the numbers.
So on average we had a, uh, four, no, on average we grew up 3 million. So average starting revenue was 4.48, I think. And then we added 3 million on average. And our average length of tenure with a client was 11 months. And that’s meaningful because it takes us three to four months to build the infrastructure and build the engine and get the right people, the right seats and have the right go to market strategy and build out all the revenue functions before we can actually go into execution. Typically we’re not seeing the revenue component until months 6, 7, 8, 9, 10. So it’s amazing that that much growth can happen in just a few months, like a real hockey east Dick nature, but we’ve got 22 people. We’re Denver based. I have my beautiful five year old son, my amazing husband. I’m just so happy. God has blessed me more than I could have ever imagined. And this has just been the best journey ever. And then I was really excited when you said, Hey, do you wanna be on this podcast? And was like, of course I wanna be this podcast.
Oh, I love that. What do you think? So just to give you sort of like a feel for our audience, we are about 60% entrepreneurs who have either done this before, or they’re somewhere middle of the journey the first time around, you know, they’re, they’re learning all these lessons, but we do have about 40% of our audience that is brand new or, or they’re thinking about being an entrepreneur, but they’ve never really done that before. And they’re trying to get a feel for what is it really like because it’s hard in an NPR story or a news story that’s five minutes or 30 minutes or whatever, to get a real sense of. What does that journey look like? And what do you go through as the founder of a company trying to do something like this in that timeframe. Right. So what would you say knowing the mix of our audience? What would you say is the most important lesson that you’ve learned at as an entrepreneur?
Well, you know me, so I can’t just give you one, I’ll try to keep the
It on, bring
As a startup founder, I went all in at great sacrifice to everyone and everything around me. In hindsight, we sped up our timeline to being successful, but it was at the expense of a lot. Mm. And I’m proud of our journey and I’m very thankful for it, but I don’t know if it was the right way. Mm. To scale. Initially, I’m talking a hundred hour work weeks. Yeah. A cutthroat environment. I was not a good heartfelt leader. When I first started, I was so high urgency, fast paced, uh, ego driven, get it done at all, costs, grind, hustle, all those things that I was raised professionally with as a former top salesperson, that’s what I walked into every day. And that was what was ingrained in me. If you were gonna succeed in win, this is how you had to be highly competitive steam rolling.
And that’s how I was. That’s how I approached scaling how revenue. So the first two and a half years of growing this company, it was just a relentless pursuit to break down, like to a point of breakdown in exhaustion. I neglected my husband. I neglected my son. In fact, my son wanted nothing to do with me. He only had a relationship with daddy. I was training training. I was traveling every week and sometimes just one or two day trips. In fact, every other week I had the schedule to fly to LA same day in and out to go support a client. And the travel schedule was just unbelievable. So the lesson learned from that is no right way to get through the initial scale, but for a services company, we did pretty good. Uh, we got to just under half a million in our first year, our second year, we three X to 1.5, our third year pandemic year, we finished at 2.2 last year, our fourth year we finished at 3.6 and now we’re at a run rate to do about 4.8.
We may hit 5 million this year, but I’m not stressing for it. I don’t care at this point. I, this is like my breathing ear. Yeah. To just optimize what we have and be super thankful for that. But I think lesson number one is you have to choose the path because we scaled rapidly and through rapid scale, it means trial and error is very fast. It means when you identify that a certain strategy isn’t hitting you scrap it and I can handle change. I handle that pace. Most humans cannot. And so I burnt out a lot of people. I created conflict for a lot of my team members early on where they were having battles with their own home life because they were so dedicated to this company and doing whatever it took to succeed after the pandemic hit and everything shut down. And me a great pause.
That’s when I really got to reconnect with my faith and my purpose and my family. And I just rebuilt this company in a completely different fashion. And 2020 was a growth year for me personally, to shed some of who I was previously with that succeed at all costs million miles, an hour person into who I am today. And I’m 2020 was part of that journey. 2021 really put a bow on it, 22. I’m like, oh my gosh, I can finally breathe. And we’re making money. And our clients are all succeeding and everything. Employees are happy. We have work life balance. Like we integration or whatever, fancy words people wanna use. I don’t care. We’re all happy. Yeah. How’s that? So I’d say that was the top lesson learned is just what kind of path do you want when you’re scaling and, and doing that. But for the other 60% of your audience, the ones who have done this before middle of the way through the biggest lesson is adapting your go to market strategy.
Even if you’ve already is shown success with the way you’ve historically gone to market, we are seeing shifts in the way buyers buy and interact with brands and make buying decisions. Whether it’s on the D D to C side or B2B, we are COVID has. And then now the resulting supply chain issues. Yeah. And labor shortages. Yeah. The whole situation with the pandemic has caused certain markets to forever change the way that they operate yet. How many go to market strategies oh, were ripped apart and redone to align with that align with that. So a lot of the companies that come are coming to us and have over the last four or five months, the number one challenge. And they’ve, they’ve they’re second stage. So they’ve already done 1, 2, 3, 4, 5 million, and they’re kind of plateaued. And the pandemic maybe did ’em a couple favors. And, but then they kind of hurt ’em here and then they’re stuck. Yeah. And the first thing we do is look at their, go to market and say, you can’t continue to go to market the way that you always have because the buyer, your market, the company ti it’s changed, all of this has changed. Yeah. And so I think that’s my number one, just takeaway and advice for that other group that listens to this is reevaluate the way you’re going to market chances are you would benefit from a shift.
Yeah. And would you say this is unprecedented? I mean, markets don’t typically change like this. Do they? I mean, even, even, even in the days of tech and fast motion and all that, it’s still, you know, one of the statistics from, uh, uh, Charles, Fred who runs true space and you know, all the research that they they’ve done is it takes the average company 12 years to get to 10 million in revenue. That’s a long time. Right. So is this unprecedented or is this something, you know, where as a company, you’re always evaluating a go to market strategy and it evolves and changes constantly frequently. Like what, you know, know, what do you think about that?
I look back at our history pre pre pandemic and post or during pandemic, we were always iterating our go to market strategy changed probably a hundred times in our first two years. I mean, every time I saw a hypothesis, which a lot of go to market strategy is hypothesis until you take it to market and you get some data and you look at the data and then you’re able to determine if you need a retest or you can optimize and scale. Yeah. And every time I got data that wasn’t in our favor or our clients’ favor, it was like, we have to shift, we have to shift, we have to shift. And I think that great companies who maybe do that 10 million and half the time, or a third of the time are heroes of the go to market. And they shift it a lot. I would say that that has to be one of the winning factors for scaling quickly with that. Yeah. This is unprecedented. Yeah. We, I mean, look to 2019.
Look at what our culture was, how powerful the economy was.
How much money we were all spending. Yeah. As consumers, as businesses, how stringent our practices and policies were and strict with, with employees in the office with the amount of budgets that we spend on travel. And in person meetings, trade shows, events. I mean, our world, we were running the rat race at a level and it was predictable. Yeah. I felt like the plans that we were putting for scale, we knew no matter what it was, we all had the playbook for it because things had been pretty growingly consistent. Yeah. From 20 16, 20 15 to 2019. And so it was a little bit more predictable come 20, 20. Yeah. Unprecedented industries that hadn’t had a lot of shift in change and maybe 20 years were flipped upside down overnight and had to reinvent themselves. You look at, it would happen in the world of, uh, CPG and supply chain.
All of a sudden people needed things. Same day shipping overnight. I mean, it took an industry and accelerated it probably by five years. Another crazy thing that happened in CPG is brands. Historically the go to market playbook was for CPG was you sell your product online to prove that you can get sales through e-com. Then you take your product to like, uh, little flea markets or little shows or farmers markets or whatever. And you start to get a following. Then you can take your product and solely play it in like boutiques or, you know, some of those shops, or you can find some shelf space with little barrier and you prove, and you can show this data. Then you go do your big pitch to brick and mortar. You go to target, you go to home Depot, you go wherever and Walmart and you’re trying to get, or if it’s food and you’re gonna grocery stores or Kroger, like you’re pitching, and you’re trying to get your product on the shelves. And that means you really made it. Then you’re working through these distribu channels and whatever, but only those big successful brands could really make it. And so all these tiny small brands where people are like screen printing t-shirts in their garage, they didn’t have the pathway to scale to the consumer. All of a sudden when brick and mortar and retail got shut down, every brand got a chance,
Eco and Instagram ads and whoever else, it didn’t matter if your operation is in 40 warehouses across the United States, or if it’s in your basement. Yeah. You have the same pathway to the consumer and ability to succeed. And so the whole playbook for CPG changed. Now a lot of the CPG brands we’re working with, they’re like, we’re skipping retail. I’m not even dealing with that. We have such a successful e-com business and they’re not even looking at the expense of brick and mortar. And so, yeah, you’re talking about unprecedented industries. Who’ve like been running the same way for the last 20 years. Completely flipped on their head.
How so in the startup world? You know, it, sometimes it can be difficult, figure out what is the right go to market strategy. And I love your message about tweak it, refine it, change it often. How quickly are you listening to like, I guess my, the first part of the question is what kind of data are you looking for when you deploy a go to market strategy? And how quickly do you feel like you have enough on that? Know if you need to change direction or not?
Yeah. We have to follow we’re big fans of Mark Roberts and he has science scaling and he talks about product message fit and then product market fit and then go to market fit. And I think that this is a good framework to break it down in a way that people can understand, just depending on how early stage you are, product message fit. That’s what we started with at sales BQ. I had identified a problem in the market, small business owners, typically when they hit about a million in revenue and it’s founder led sales, they run out of bandwidth to continue sales and they plateau, right. And so they’re looking at making that first sales hire and they historically it up. They, they either hire really expensive VP of sales who needs to build all the infrastructure and processes, but they’re not really willing to carry a bag anymore.
Or they hire somebody who can carry a bag, but there’s no infrastructure systems or processes. And so they struggle because the environment is really unpredictable and they don’t know what they’re doing. And the CEO can’t convert to a full-time sales manager. Usually they don’t have patience or skill. Yeah. So therefore we solved that problem, but it was product message fit. Meaning I had identified the problem. So I came up with a really great sales pitch and a really not pretty click and drop Goda website with a pixelated logo. OK. I’m like scrappy entrepreneurs unite, but that’s like how we went to go to market when we were in our product message phase. Yeah. So that is like day one. So the other thing about product message phase is we had three to three beta cus. So I found three CEOs that were brave enough to be like, I like what you’re saying.
And we’ll give you a small amount of money to show that this works. So I found three brave CEOs that paid me $3,000 a month each to be their fractional VP of sales. I did it for three months. Three CEOs make a nine grand a month. I’m like, Hey, this is is sweet. It doesn’t replace my income, but it’s enough to live. This is cool. And guess what happened in three months, I started to work out the kinks. I started to define the process. I implemented immediate feedback loops. I created systems. So I had visibility into data on leading and lagging indicators so that I could work out what is the playbook for new company that I created? What do we do here? Yeah. Yeah. And then from that, as soon as I had consistent repeatable results, and that’s when you start to know you have product market fit is when you can see consistent repeatable results that match your product message fit and predictable.
Right. Predictable. Yeah. Correct. Yeah. If I do this, then I yield this. Yeah. It has to be consistent. Yep. So that’s when I brought on a couple of consultants because we went from three clients to nine clients and I hit my bandwidth at about five or six. Yeah. So I brought on two fractional VPs of sales that were my contractors, Rob and Rob. And they were, yeah, not a lot of diversity that we were able to then triple the size of the company, three E contractors. Then we started to get more data, more feedback. What I started to notice then is there was variance between the different industries that we were serving. Oh. So it was adjusting our product market fit because it was, was working. I come from a service company, background selling payroll and HR services. Now there was a SaaS component to it.
So when I was selling or when we were doing this service for those in that industry, it was very known to me. Sure. I had a lot of confidence in the playbook and the methodology. Sure. But then when we started working in manufac manufacturing and distribution, we had like an oil and gas client, financial services, other industries, I’m like, oh, it’s different. It’s different. Yeah. You gotta adapt and figure out what you need to bring to market differently for that type of company. So all of a sudden we’re going through this evolution that in order to maintain our product market fit, we had to adapt specifically within each of these verticals and who we are serving. Guess what? The next awakening was? Segmentation size market size. Yes. So a company that was building a sales department for the first time, the playbook was wildly different than bringing on a client that had four or five or six or seven sales people. Yeah. And so now we had to adapt how we were going to market again, because they needed different things. So in, so you have to go back to product message, product message for a seven person sales team and a $10 million company is different than product message fit for a $1 million company with a CEO who’s doing sales. So we had to adjust and adapt. So it wasn’t until like in our first year also guess what else? Contractors, they don’t work. I have to turn people to employees.
You can’t tell a contractor who, what, where, when and why you start doing that. They’re an employee. Right. So that’s expensive though. Yeah. And as a CEO and the first year as a founder, when you convert to money and money out, very easy to control expense. Yep. To, oh crap. Whether we have money coming in or not, money’s going out. Yeah. What a shift. And so that happened in our first year. But once we got into the second year, we had more established processes, had a six person team. We had a flow of clients coming in and then that’s where product market fit was established across multiple industries across multiple segmentations. So now the go to market strategy, that’s the year that we set to three X. Wow. Because we had a go to market fit. Yeah. Now we didn’t rest on that because six months into that year yeah.
Of tripling in size. Yeah. Because we had go to market fit is when we continued to evaluate. And that’s when we saw, if you remember that point in my story and we had skill or we had built, uh, 45 sales departments and it was obvious the ones who had great breeding and market way outperformed, those who didn’t, but it took us 18 months cuz you need time to accumulate data. And so you never really achieve go to market fit and you’re just set forever. Mm. You have to constantly go back product message, product market, go to market, product message, product market, go to market. And so we had to do it all over again. We did it in 2020 when we launched a full scale ahead in 2021, we tried working with startups. We tried doing marketing only and we tried a few different things by the way, it didn’t work. Um, so 20, 22, that’s what I’m saying. This is like my year to breathe. And then that’s where like our go to market fit. Now we can just optimize. And then when we feel like scaling where we have the, we have it, it’s down to a science, it’s a hundred percent producing results. And now we just know like we can go up another pod, another factional revenue team, and then we can scale.
I love that. So the message being you can’t I always say, I always say this to my, to my clients. Right. Which is, they’re always like, I need to go raise money so I can put money into sales and marketing. I need to go raise money so I can put money into sales and marketing. And I’m like, but what are you putting money into? Right. Like if you have money is like gas on the fire. Right. And if you have a BU beautiful fire pit that is completely without kindling, without wood, without a fire going at all and you pour gasoline on it, you just have a big wet patch of ground. Right. And that’s a lot of waste. Am I? Right? Yeah. Whereas if you understand, and this is, you know, to your point, the, the single founder, you know, in the service businesses to get to that 1 million point, probably they know they probably can’t articulate it, which is where you, you and your team come in, but they probably know what it takes to sell.
And they probably know how to sell, you know, and close a, a good percentage of their business. That’s very diff than a, than a company. That’s like, okay, we’re gonna hire three salespeople. And they’re gonna, they’re gonna build us from startup to, to scale up. And it’s like, but what are they selling and how are they selling it? And what is the messaging? Right. And I think, I think that’s kind of what you’re getting at, which is you can’t put resources into something that you don’t understand. Well, cuz you won’t get a return out of it.
No, you, the fire comment is what came, what was present for me when you said it is you’ll scale, whatever you pour gasoline on and one’s gonna have a good outcome and one’s not. Yeah. So when you get that funding and you get that money, boy, I’m sure you and I both can trade on what some companies have done with that. It is irresponsible. Yeah. To go hire a 10 person sales team. You can’t, if you do not have all of your infrastructure built your revenue engine, you have playbooks and processes, standardization management in place who is trained managers, FYI, which is like a whole separate conversation. When you grow mid-level management, you have to have like, you can’t build your house on the sand. Cuz when the storm comes, it’s gonna crumble. If you build your house on the rock or a strong foundation, when the storms come, which by the way
Storms come, you’re gonna come. Like
Nobody is storm immune. Then your house is still standing. If you’ve built it on the rock. And a lot of times it’s very tempting when founders get that money and they, they do, they’re like, well we have to show the investors that we can get 85 new logos before the end of the year. So I’m hiring 10 sales people. But the problem is, I know the investors are putting that pressure on. Um, but I promise you, they would rather see 85 logos and a scalable foundation rather than a chaotic hot mess or blood, sweat and tears. And non-scalable activities went to getting 85 logos. Yeah. So we’re clear, like there’s two ways to do it. And additionally, like the recommendation would be before you go get the money, like build the foundation. Yeah. Or build the foundation while you’re raising. Yeah. Because when the money comes in, yeah. It’s a pain. Like we have some C come to us and like, Hey, we just closed this round. We have X amount of dollars. This much is being allocated here. And then we’ve allocated X amount to marketing sales and we’ve already talked to some recruiters like we’re in process of hiring. I’m like don’t
I said, you’re just gonna throw that money away. And, and then, but you’re gonna think you have the right strategy, but then six months down the road after you’ve spent 60% of these dollars, you’re not gonna have results. But if you can just hang tight and work with us for 90 days and just cool your heels, let us build the revenue infrastructure, like build the actual engine and then we’ll put the gasoline on it and then you’re not gonna have issue, but yeah, people see that money and it’s not like ill intent, you know, it’s just, if you haven’t done it before, I remember, uh, chatting with an entrepreneur here in our local Denver community. So not his first rodeo. He had like built, scaled, sold, I don’t know, umpteen companies. And he’s like, okay, I think this is the last one for me. And we were talking about where he was and there about 7 million. And he goes, you know, even though I’ve done this so many times before and we were just laughing, he’s like, listen to what I did on this one goes, I hired this person. I didn’t, you know, and we were cracking jokes. So people aren’t immune to it, even when you’ve done it this many times. Yeah. But yes, they got funding. So he is like, okay, I’m committed to doing it different this time.
Yeah. I love that. We, we experienced something very similar to that last year in Precursa, we, um, you know, have been working on figuring out what we wanna do for a raise. And you know, we thought we had some money in the door last year, turns out it was a blessing that that didn’t happen. Um, but when we found out that it wasn’t gonna come in, we, well, we have this marketing strategy to try and build an audience and a, and a mail list for a D to C you know, kind of strategy. And we said, okay, well maybe we should take, you know, and put some money into it, you know? And so we said, okay, we’ll, we’ll do like $5,000 a month. And uh, you know, we’ll, we’ll build up this. And within two months we knew it wasn’t gonna work. And I was really, really grateful at that point because we could have very easily put 30,000 a month from the money that we raised into that.
Even in that same two month timeframe, that would’ve been six times the spend six times the wasted money to realize this is not gonna work. Like this is not how we’re gonna find our people. And so it’s just, it’s fascinating to me. And I, I guess that kind of leads into my next question for you, which is, what do you think is the most important, like characteristic or personality trait that someone has to have in order to be a successful entrepreneur or be a successful founder? You know, what, what, what would you say that is?
I, I mean, I think that this entrepreneurs can at themselves out of any situation and I think the amount of complex problem solving and navigating difficult circumstances, managing difficult personalities and financial situations, an entrepreneur with a high figured out factor, you know, people you’ve been around that, no matter what, they just always win. Yes. Like no matter what, like you know that person
Yeah. We’re talking
Seriously. Know what
Very girly is
Yeah, yeah. Let’s just hug.
Oh, but you know what I mean? There’s some people that you look at and say, no matter what hand they’re dealt, this person always comes out on top. That is a person with a high figured out factor that doesn’t get weighed down. And woe is me and the world is crashing down. Is everyone out to get me like bad things happen? Yeah. Bad things happen to good people. Yep. And there’s a way to persevere no matter what, every time I have, I am dealt a difficult situation or a trial. I look at it almost like a game board. And I take all the variables of the situation. I try to narrow it down to root cause. And then I look at all the front pieces and players, I lay it all out and I build like the battlefield, a game board. And I figure out what all my possible moves are.
And then I anticipate what all the possible outcomes would be. I think about multiple strategies and ways that I can overcome the situation. I played out my head. Sometimes I write it out or I find somebody to talk to, and then I pick a strategy and I go for it. But because I’ve done all the preparation, I know what some of the potential outcomes could be. So if I start to see that thing happening, I’m like, I already ha I already thought this one through, I messed step ahead. And so I’m able to conquer a lot of adverse city in challenges. I think that is the trait of like the top trait of the highest performing entrepreneurs.
I love that. How important do you think it is? I, I’m kind of going back here, but nicheing down. I, I hear this so often and I try and I try and explain to entrepreneurs is that until you can speak to a market really, really well, like a very specific market really well, you know, if you’re trying to speak to everyone, you’re not gonna speak to anyone. Right. And I just wonder in, in with your business and your experience and all the, all the work that you’ve done with all of these different kinds of companies, what would you, what advice would you give to people around nicheing down and finding a market, particularly when we’re talking like early stage?
Yeah. Do you, do you wanna win or not? Is the question is what I would say. You can research this to you’re blue in the face. It’s 100% successful to niche down. Yeah. And it’s also gives you life because it’s easier. And I think what prevents a lot of entrepreneurs from niching down is fear that they’re missing out on potential revenue in the market. Yes. Here’s what I am going to give you as advice. The people who are meant to be customers of yours are gonna find you, they’re gonna work with you regardless of how niche specific your strategy is and your brand messaging is, and your attraction methods are, and the way that you’ve built your sales team. What I mean by that is you can get niche specific on your ideal buyer, all of your brand marketing, messaging, sales messaging, everything that you do, the ethos of who you are as a brand and company is about that niche. But there will be people out there that say, even though therefore this or do that, I think there’s a use case. And it doesn’t mean that you can’t work with those people.
It just means that through your attraction methods, through inbound marketing, inbound sales, you’re attracting people and pooling people in because you have nailed your buyer specific messaging. So through SEO paid organic social, us, outbound sales, every events, networking every way that people are hearing about your brand or being attracted to it, the customer that you have the ideal use case for. So you’ve niche down yep. Is gonna say, oh my gosh, I can’t believe this company exists. This product or service. And they get me. Yeah. I now you’ve removed the barriers and friction yeah. Of the customer aligning with how you can make their life better and how you can solve their problems. But then you will have an outer circle. So the one degree outside of that, of people who will also experience your brand, who will also experience your messaging or hear about you through word of mouth or whatever, read a social media post or news article.
And they will say, even though they’re for this or they do that, I think they might be able to help us. I’m gonna reach out. I’m gonna have a conversation. Additionally, through other outbound methods, like your sales people, as you grow your sales team, sales people have relationships. And so they might be able to attract varying use cases that are slightly off from your niche, but so still provide great results and they’ll be able to attract and bring people into the funnel, through their outbound efforts. So look, here’s the deal, sell something people want, if you wanna scale your company, just sell something people want it is the easiest. So here’s how you do that. You find a specific group of people that have a problem and you figure out specifically how to solve that problem. And you’re gonna get that group of people all day long. And then you win.
Always ask me another question.
I know, I know we always start with solving the problem. Right. And I, I think, you know, that’s one of the things, people, people get these grand visions where they’re like, I’m gonna build this thing and then, and then we back it down and we say, okay, what’s the problem you’re solving. And who are you solving it for? And how do they relate to care? Yes. How do they relate to the problem? Why does it matter? Is it really that painful? And they go, what? I just wanna build this cool app. And I’m like, well, then you’ll be one of
You want people to buy?
Yeah, exactly. You’ll be one of the three and a half million out sitting in the app store that probably people have never heard of that have never done anything. Right. Oh my gosh. I love it. All right. So I’m going to give you a statistic and I want you to tell me what you think about it. Okay. Okay. 42% of fail because no one wants what the startup is building.
Is it that low?
That’s my favorite answer so far.
Okay. Okay. Okay. Like we’ve got a really awesome inbound funnel for house of revenue. And I just love, love, love, love that 50% of my job here is business development. It is such an honor and privilege to get to speak to so many entrepreneurs. I love founder led companies. Um, we’ve had bull that are new CEOs coming in, especially like through private equity or whatever, and they didn’t found the company and there’s just this missing passion. Yeah. So I’m all about the founder’s passion for their idea, but it is our responsibility to help them make sure that they have a, a product or service that somebody actually wants to buy. And it just goes into the go-to market strategy, competitive analysis, secret shopping, surveying the market, surveying customers, doing the primary market research and truly identifying. Is this something that a specific group of people are willing to spend money on?
And do you have a price in a way? And then have you built a revenue engine with out friction? Yeah. So that you can just allow people to part with their money and then you can delight them in the customer experience, create rating fans and have brand advocates. It sounds simple. In theory, that’s a lot of work by 42%. Um, you know, I love the startup community. These people are my people. I love their stories. I love their passion. Some things I could by myself being passionate about they’re passionate about, but their passion then is what I’m passionate about while there’s a lot of passion all at once. Yeah. Um, so that’s statistic 42%. Um, all I have to say is, you know, Cynthia, you and I are on a really similar path and we do different parts of helping start us and entrepreneurs in their journey. But what a blessing it is that we get to work with this community and share in that and, and help decrease that 42%.
Yeah, for sure. And you know, our, our goal at Precursa, we’ve talked a lot about this too, is nine of 10 venture backed companies ultimately fail, right? Which means they don’t produce a return for their investors or the company goes outta business, or they don’t have an exit event, you know, they’re, they’re, they fail. That means nine outta 10 times, everybody in that mix was wrong. And Precursa is really about like flipping that on its head and saying, the one time outta 10 were wrong, we look at each other and go, well, that was weird. What did we do differently there? Right. Because it, it, it should be not, not necessarily formulaic, but also almost formulaic to be able to understand and get a need in a market and fill that need with a product that people actually want. So it’s interesting,
But you were the person who actually shared that statistic with me maybe three years ago when we were at that co-working space on Pearl street, was it? And the wash park? Yep. Uh, or Gaylor or Pearl. I can’t remember what we were on. And I remember you shared that statistic that day. And it was the first time that I had heard that. In fact, I didn’t even realize that when you have a portfolio of investments at the expectation that the risk is built on nine out of 10, not hitting. Yeah. And, and that the one out of 10, that they’re really keen nine. But, and I remember sitting there saying, I don’t like those numbers. Why does that just feel so wrong to me? Doesn’t it feel like there’s a whole market of opportunity to work on the other nine. Yes. And I feel like you and I maybe subconsciously like shared in that vibe of there’s something Trapp with that number, because it’s not just nine companies, that’s nine founders. They’re significant others, their marriages, their families, their 401ks, their house, their employees, their employees livelihood, their mental health, their wellbeing, their careers, their families, their kids, their kids, kids. It’s not just nine companies. Yeah. There are human beings behind every employee behind every customer. Yep. And behind every investor. Yep. I’m not making our investors to be the bad person here. Right. We need them, we need that community, but holy moly, can we try to like, make it better?
And, and I mean, you can kind of get an investor’s an investor’s perspective, why it’s so difficult to get them to invest in things, because it’s so much more likely to go badly.
Right. Way more likely with those numbers, way, way. That’s not even like 50 50.
Yeah. So, so then you’re like, oh, well, yeah, of course. You’re of course you’re gonna be like, really, really, uh, I I’m gonna say difficult. And I’m putting that in quotes, in the due diligence process. And of course it’s gonna be hard. Right. Probably necessarily should be. Yeah. So, all right. So what’s one question you wish I had asked you and how would you have answered it?
What didn’t we talk about today? I, I swear this is, I don’t know what, what I’m gonna, what didn’t we talk about today?
Do you wanna talk more about the work life balance or like any advice that you have for people, because there’s so much pressure in the entrepreneur community, particularly startup founders and tech startup founders specifically, which a lot of our audiences, like you have to, to do the a hundred hour weeks, and you have to, like, everything has to be, you can’t have a life. This is your life. This is your child. This is like, is it true? And what advice would you give to a founder who feels that pressure, but also kind of has that sense that this IST, how it’s supposed to be, you know, having gone through that yourself.
Yeah. Look, jury’s out on this one because I’m coming from a privileged place. When I tell my story, I say that my great awakening was in March 20, 20 after two and a half years of the blood, sweat, tears, and neglect of my family and really neglect of my wellbeing yet, look at the success that we had. And there’s, there’s no way I don’t believe there’s any way. We would’ve been where we were in two and a half years. If that amount of blood, sweat, and tears and effort didn’t go into it. And I think that when my pendulum swung the other way, and I was given back to my family and given an opportunity where space was created around me, staying at home, no travel, not even going into the office. I finally had an opportunity to heal, to rest, to reconnect with God and my faith and to rebuild my purpose behind what I’m doing.
I was a able to rebuild the company. It was taken down, we lost 60% of revenue. And so I had an opportunity to rebuild it, but we didn’t rebuild it from scratch. And I feel like that’s where the part of my story might be a little bit unfair because now you look at my life. I take my kid to school. I pick ’em up every day at three o’clock and somehow I’m managing to be present at home to be a wife and a mom and a CEO. I have time to read my devotionals and to speak to God in the mornings to set up my day and to armor up. I have time to do that. I’m not waking up at four 30 in the morning and immediately hammering out emails and getting proposals out the door and digging myself out from yesterday. Like I have time to be intentional.
Now I’ve created this space around me, but I think that that is the fruit of the labor that went into the first two and a half years. So honestly, I don’t know the right answer here because in my great awakening, I kind of got like preacher esque in it. Like don’t I did it all wrong. I neglected my family. Don’t do that. And now look at my perfect life, cuz I have this amazing company and this, but I would, I don’t think I would have had that had I not put in the grind. Yeah. And so it really, I believe is a question for everybody to answer on their own. In what way will they honor themselves? I think the advice that I could get is talk to your significant other, talk to your family. If you have one and to really build a plan where everyone is honored.
I think the biggest mistake that I made as I took them for granted, my husband is an angel. Yeah. He supported me and he didn’t have to. Yeah. A lot of marriages are destroyed with entrepreneurs. It’s very difficult to be married to an entrepreneur. Yeah. So get right with your support system first, create boundaries, communication pathways, and figure out how people are gonna be on so that while you go through that scaling hustle journey of your, of your startup, you are not violating those that you love and dishonoring them. And I think if you can define that with your support team and your employees. And I think if you can, co-create the answer then you’re gonna win. I didn’t create it. I just set out on a path and steamrolled. Um, but really thankfully my family is, uh, is here in supporting me and a amazing team on the other end of that. So I’m very thankful.
Yeah. I love that answer. I absolutely love that answer. What are some resources or podcasts, or maybe you wanna tell us about your radio program? Like what are some things that you would recommend for my audience that would be helpful, uh, as they’re on this journey?
Yeah. Um, revenue, radio,
Revenue, radio, you can look all the way back to the origin and find Cynthia’s episode, which was really the first time that somebody clued me in so well on product market fit. That was actually one of my favorite episodes recorded. You’re such a ninja in that space and it was, thank you. Helpful for me to put it together. I love leaning on others, other experts in this space to just speak that wisdom into me. It really, really was an incredible episode. So revenue, radio, I trans just like with COVID and everything else. It was so hard to schedule guests in the studio and do all of that. So now it’s just an at-home podcast. I love. And it’s turned into me like behind the scenes of what it’s like to be a scaling CEO.
I love who’s
Also a Christian woman, which there’s a, there’s some challenges with people of faith. Yep. Who say where’s the right line to walk between being a person of faith and being a CEO and leader. So it’s cool. Like I’ve gotten good feedback from it. I’m always willing to take off more feedback, but I love the way that the program is structured. So revenue radio is a resource that I hope your audience would find valuable. Other than that, I think, uh, other available resources or things that I read and spend my time on, I’m really digging into John Maxwell right now. Oh yeah. As I’m looking at enhancing my, my leadership ability and I’ve really been enjoying his work. So that’s something I’ve leaned into a lot. The last thing I’ll say is something that really shifted my perspective when we were scaling last year, we doubled in size last year, which was a really exciting, tumultuous experience. I read the book, the hard thing about hard things and outside of the gangster rap references that I’m not really into the rest of the book was pretty fantastic. And it helped me understand very difficult concepts and how to avoid them. And then if you missed the window of avoiding it, how to clean up the mess and not be, uh, emotional about it and really let it bring you down. So it was one of those really great tactical books for me in the,
Okay. I love that. I love that. Miss Mary Grothy. We are so, so glad that you joined us. Thank you so much for sharing your time for sharing your wisdom for being so generous with, with our audience. If people have questions, if they wanna get in touch with you, or they’re more curious to find out more, obviously I’m gonna to link to revenue radio. What is the best way for people to follow you or get in touch?
You can connect with me on LinkedIn, Mary growth, E G R O T H E. You can also shoot an email to info house of revenue.com. It’ll find its way to me and we can connect from there.
I love it. I love it. Thank you so much for joining me today will include all the stuff that you talked about in the show notes and you go keep rock and girlfriend. You are awesome. I’m so inspired by you every time, every time we talk and every time I see you doing stuff, I’m like, I love that girl.
No feelings are mutual. My dear. Thank you so much for having me. You’re
Welcome. All right. Y’all thank you so much for joining us for this episode as always happy entrepreneur and I will see y’all next time.
Thank you for listening to this episode of Precursa: The Startup Journey. If you have an idea for a startup and you want to explore the proven process of turning your idea into a viable business, check us out at precursa.com. Make sure to subscribe to this podcast wherever you listen to podcasts so you never miss an episode. Until next time…