$1 Million In Insights
In previous This Week with Sabir episodes, I have focused on the “$100,000” question, the single best piece of advice that the interviewee can provide for their specialist topic.
, an expert on B2B scaling, discussed the benefits of being proactive, of avoiding procrastination, setting goals, and starting right away. For strategic thinker Paul Butler , it was all about understanding your real value and what it means for your business, while smart voice expert Patrick Givens discussed how tech like Alexa and Google Home can shape the future of business.
With Matt Higgins, I wanted to take it to the next level.
Matt is one of the most successful businessmen in the United States, with investment portfolios in the billions of dollars and advice that has helped countless aspiring entrepreneurs to reach their goals.
The goal, therefore, was to provide $1 million worth of insights, and during an interview that lasted just under an hour, that’s exactly what he provided.
The Most Important Question
The business landscape, and the world, has changed dramatically over the last few months.
Data experts can run simulations and industry-leaders can predict trends, but in 2019, no one could have predicted what 2020 had in store.
The spread of Coronavirus has changed the world as we know it, bringing businesses to their knees, decimating investment portfolios, and causing catastrophic damage to the global workforce.
News sites and newspapers are littered with stories of small business owners that have lost everything, while multinational companies in the tourism and hospitality sector may never recover.
At the time of writing, we’re still in the midst of this chaos and while job figures are improving, US Coronavirus cases on the rise.
Some experts predict that the US will hit 100,000 cases per day before the end of summer and even if we escape this disastrous first wave, another one could be on its way by the end of the year.
Better times are ahead, and things will improve, but as far as 2020 is concerned, there is no bright and welcoming light at the end of this dark and dismal tunnel.
My first question for Higgins, therefore, was how this changing landscape has impacted small businesses looking for funding and desperately seeking growth.
This is something that Matt has addressed multiple times before. After all, he became CEO of a company that was tasked with rebuilding the World Trade Center site, and candidly speaks about the difficulties that have surrounded his life, saying that his youth was somewhat of a “forest fire”.
One of the first things that companies do following a tragedy, he noted, is to try and rebuild. They strive to return to what they had before, building brick-by-brick until their business looks the same post-disaster as it did pre-disaster.
But in many ways, that business is now a relic.
It’s like introducing DVDs in an era of digital streaming or relaunching Blockbuster in an age dominated by Netflix. In other words, the world has changed considerably, and you need to adapt your business to match.
At worst, you’ll fall behind and struggle to keep your head above water while your competitors flourish. At best, you’ll miss a potentially lucrative opportunity and may never have another one like it again.
The Coronavirus pandemic began just seven months ago, and it has been just four months since it began to take hold in the west, leading to lockdowns and terrifying news headlines, and creating a world that feels like the first 10 minutes of an apocalyptic Hollywood flick.
But despite the relative youth of this atrocious illness, it has caused a massive societal shift and changed the way of life for every man, woman, and child on this planet.
It has killed hundreds of thousands of people and caused lasting physical and emotional damage to millions more. It’s bleak, it’s frightening, and it will cause immense changes. Not all of them will be bad, but many will be significant, and simply rebuilding what you had before probably won’t be enough to keep your business alive.
At best, you’ll struggle; at worst, you may miss an opportunity to grow, develop, and take your business in a new and more profitable direction.
Matt recommends the following for all businesses who find themselves hit by the paralyzing blow of COVID-19:
1. Stabilize, Think, Plan
At any other time, thinking on your feet and taking quick and considered actions can be beneficial to your business.
Acting quickly can nudge you ahead of your rivals and allow you to capitalize on major trends.
During COVID-19, however, such impulsive actions have caused endless problems for businesses around the world.
At the start of the pandemic, small business owners made rash decisions based on the general consensus at the time. Rather than reducing their stock and staying cautious, they assumed everything would blow over, and continued as normal.
Before the summer, many similar assumptions were made.
Business owners predicted that the daily cases would drop, and the country would reopen. They increased their marketing, bought more stock, and prepared for a bumper summer, only to realize that those predictions didn’t come to fruition.
We are living in unprecedented times, and it calls for a slower, more considered, and more cautious approach.
Rather than basing your decisions on hope and preparing for a COVID-free Spring, Summer, Fall, or Winter, think about how you can stabilize your business, protect your assets, and keep everything ticking over.
Once your business is secure, you can follow the news, watch the trends, and think about relaunching, rebranding, or rebuilding your business in a way that is more suited to these troubling times.
Right now, it’s all about surviving, biding your time, and waiting for an opportunity to present itself.
2. Audit Your Assumptions
Everything you assumed prior to the pandemic needs to be audited, checked, and changed.
In our interview, Matt uses one of his own brick-and-mortar businesses as an example.
In auditing the business and calculating how much runway it had to survive, they discovered that their predictions were based on the assumption that all retail would be open by June. They estimated that they would be back in business by this date and be at full capacity by December.
These assumptions were based on the curve and on projected daily cases, which in turn were based on data from countries like Spain and Italy. But as we know, that’s not what happened, and as mentioned above, US daily cases are higher than ever right now.
Rather than assuming a best-case scenario, prepare for the worst, and don’t stake your business on an optimistic prediction.
3. Look For An Opportunity
During any crisis, there is an opportunity for growth and development. Look at the data and the trends and ask yourself if there are any ways your business can move in a new and more profitable direction.
It’s important to note, however, that we are not talking about capitalizing on fear or desperation.
By opportunities, we don’t mean bulk buying cheap alcohol gels and selling them on eBay for extortionate prices, as many unscrupulous people did in the early days of the pandemic.
You may, for instance, look at how the mindset of your consumers has changed.
They may be spending more time indoors and be more willing to make larger and more infrequent purchases, as opposed to regular small orders.
They may be focusing more on their health, and on products such as supplements, fitness equipment, and exercise programs.
Adapt your business to suit these needs and to meet the changing tendencies of your consumers.
As Matt stated during our interview, the pandemic will almost certainly have created an opportunity, you just need to find it.
4. Have Faith, Persist, And Be Patient
In the words of Matt Higgins, to persist is to prevail.
If you can buy yourself another day, you have another chance of keeping your business afloat over the long-term. Buy yourself 6 more, and you have a week-keep persisting and you’ll keep surviving.
Of course, there’s no point feeding money into a failing business, but if the finances are viable and you’re not risking complete financial ruin, what do you have to lose?
You’re slapping duct tape onto a sinking ship, hoping it will make it back to port and you can fix those problems properly and set sail for another journey.
What’s more, if you follow the tips outlined above, every day that you survive is another chance that you’ll find an opportunity and take your business in a new and exciting direction.
Are There Really Any Positives?
As mentioned above, COVID-19 has changed the world and not all of those changes are bad, at least from a business perspective. It is something that Matt spoke about during our conversation and something I have stressed before as well.
So, what do we mean by this? How can a pandemic possibly make positive changes when it has wrought so much destruction and misery on the world?
Firstly, I should stress that COVID-19 is not the Black Death.
One of the recent social media trends is to highlight the ways in which the Black Death changed the world for the better, such as creating the middle class, helping to bring millions out of poverty, improving social mobility, encouraging free movement, and creating more equal opportunities.
None of this has happened with COVID-19 and none of it will happen, either. The Black Death killed a third of the population of Europe and the aforementioned improvements were simply the result of a reduced population.
For COVID-19, the changes have been much less noticeable.
As an example, many entrepreneurs, investors, and businesspersons are now relying on Zoom to correspond with clients, customers, investors, and employees. In the recent past, if you wanted to discuss a big deal, merger, or investment, you had to travel, even if you lived halfway across the world.
People like Matt were constantly on the move, driving across cities, flying across countries, and spending more time in the air and on the road than at home.
Not only are all these meetings now taking place over Zoom, Skype, and similar apps, but people now realize that this method is way more convenient and just as beneficial.
When the pandemic is over, these meetings will continue to take place over the internet. This means that influential people can fit more meetings into their day, and you don’t need to fly halfway around the world to meet them.
It saves time and it saves money, because you don’t need to drop several thousand dollars on plane tickets just for an unproductive 20-minute conversation.
You can also assemble an entirely virtual staff. This has always been possible, but it has also been frowned upon and limited to specialist contractors and freelancers who are used to working remotely.
These days not only is everyone is happy to work remotely, but companies are beginning to expect it from their employees.
Attitudes have changed, the infrastructure has improved, and as a result, the day-to-day of a business owner has become significantly cheaper and more convenient.
We have had the technology and the means to facilitate these changes for years. In fact, many young entrepreneurs have already taken advantage of this and are operating their businesses from their homes or co-working spaces, only to run into investment problems because they’re viewed as being somehow inferior simply because they lack common infrastructure.
The pandemic has brought all of this to the fore and it will likely remain long after the pandemic is gone.
Businesses won’t be seen as inferior just because they operate in the virtual space and they can function more efficiently than ever before.
It’s also great news for any aspiring professional.
You can launch a brand-new business with much less capital. You don’t need to rent office space and pay for regular travel. Everything can be orchestrated from your computer, leaving you with more time and money to focus on things that will actually grow your business, such as marketing and stock.
Getting Funding, Building A Brand, And Making It Work
Matt Higgins is best known for his work on Shark Tank, and this is something I asked him about during our interview, questioning him on the best time to seek funding and on what you should do to prepare for a pitch with him.
We also discussed branding, the opportunities that are available to aspiring business owners, and more.
Here are the main points we addressed:
1. Be Self-Aware
According to Matt Higgins, the fish stinks from the head.
Matt is confident he can find any problem at any organization and trace it to the CEO.
This stems from a lack of self-awareness, and it’s a problem inherent in many failed startups and in businesses that struggle to get adequate investment.
For example, let’s imagine that you have engineered a new product and are focusing on a potentially lucrative industry. The problem is, you don’t have any experience in marketing or starting a business and you don’t have the capital to make it work.
If you were self-aware, you would identify those issues and look for an investment, whether that comes in the form of a major stakeholder or a co-founder who can help you launch your company.
They will cover the funds you require but they will also provide business and marketing experience, giving your company the launchpad that it so desperately needs.
Without self-awareness, you’re prone to making a mistake that many people in this situation make and one that we have seen countless times on Shark Tank. You try to do everything yourself, maxing out credit cards, taking a second mortgage, and ultimately failing because you know nothing about business or marketing.
These debts are fine if your business is strong enough to succeed and those funds will give you a good ROI, but without that strength and experience, it’s a recipe for disaster.
You may even spend all of your money on hiring a VP of Marketing, someone who is working for a paycheck, isn’t fully invested in the company, and, therefore, is not committed in the same way that you are.
It’s easy to mistake this attitude as arrogance, assuming that someone goes down this route because they are overconfident in their own abilities and think they can do everything.
More often than not, it’s simply because they don’t want other people in their business, especially when they are the ones who had the idea and created the product.
They also assume that the idea is the hard part and that everything else will happen naturally. But without the right investment and the right marketing, even the best products will fail.
Founders in this position like to point to the great inventors of the past who created products and launched successful businesses based purely on their engineering expertise. But very rarely is that the real origin story of these investors and their products.
It’s the story you read in their biographies, sure, but only because the truth is much less interesting.
What’s more inspiring, an inventor who found a niche, created a product, and earned his millions through sheer invention and individual brilliance, or someone who had the backing of a competent team, worked hard, invested heavily, and toiled their way to the top?
Self-awareness is about realizing that you can’t go it alone, understanding where your faults are, and being willing to fix them.
2. Do You Respect Your Limitations?
When you meet with investors like Matt, you have to remember that it’s not just about your product, it’s about everything else that goes along with it.
Put yourself in an investor’s shoes for a moment.
Imagine that someone approaches you with a genuinely brilliant product, but they have no business sense, are arrogant beyond belief, and refuse to acknowledge any of their obvious flaws.
The average Shark Tank viewer might still invest, but only because they’re doing what the pitcher is doing and focusing too much on the product.
The problem is, a great product is worthless if no one buys it, and if the founder doesn’t have the right attitude, they won’t take the necessary steps to make that product a success.
What happens when the world suddenly changes, as we have recently experienced with COVID-19?
If they are arrogant and stubborn, they may refuse to adapt, dig their heels in, and eventually watch the business (and all of your investment) burn.
Investors invest in people, as well as products; they invest in businesses, as well as ideas.
You don’t need the perfect product, but you do need to accept where your potential issues lie and acknowledge that they need fixing.
Matt wants to work with a founder who is willing to hire experts to fulfill roles that they can’t perform themselves, as opposed to one who sees themselves as a jack of all trades and tries to do everything.
3. Don’t Ask To Be Rescued
Investors don’t want to be seen as saviors whose sole purpose is to rescue a business from the doldrums and make it successful.
They have their own businesses to think about and their days are already filled with endless meetings, negotiations, and work-the last thing they need is a full-time job working for you.
This is something that Matt explicitly told me during our interview. One of our regular viewers asked what a business should do if it doesn’t have the money to hire staff and can’t afford to contract marketing, design, and sales jobs to proven experts.
Matt’s frank advice was to find that money anyway you can.
It can seem heartless, and for some, it may even seem impossible, but again, you have to put yourself in an investors’ shoes and understand that they don’t care about your business or your plight until they are actively invested, and they won’t invest if they don’t see any potential.
Imagine that you’re working 19 jobs and struggling to find any free time, as is the case with Matt and countless other experts like him.
What will you do if a small and struggling business approaches you for investment, but says they don’t have any money to spare and want you to supply all the capital and get the business off the ground?
It would be like launching your very own business, only you’re getting a fraction of the ownership.
You’re going to refuse, of course you are, because if you accept offers like that, you wouldn’t be a successful expert and you wouldn’t be able to juggle so many jobs.
But if that same business owner approaches you after investing all of his savings, taking loans from friends, and generally doing whatever he can, you’ll be more inclined to invest. You know the business owner is truly prepared to put everything on the line, and it’s much easier to get behind someone who has that mentality.
To paraphrase Matt Higgins, “If your business is not worth you working two or three jobs to get the money you need, it’s not worth my time, either.”
Founders with funding problems also tend to hire multiple co-founders. They offer large shares in their business in exchange for relatively small investments, and by the time they approach someone like Matt, they may have 4 or 5 co-founders, each taking a share.
Statistically, a business is more likely to succeed with just 2 co-founders, and the more co-founders you have, the more likely you are to experience problems down the line.
It’s like being in a band. In the beginning, everyone’s getting an equal share and performing an equal role, but when that band hits the big time, the singer might be committing to more studio time than the drummer, the lead guitarist might be writing most of the songs while everyone parties.
Eventually, it will be obvious that there is no longer a fair balance, and the business will fall apart, just like so many successful 4- and 5-piece bands.
Multiple co-founders also dilute the share, which leaves very little for the investor. If you recently acquired a fifth co-founder for a small $5,000 investment, how do you think an investor will feel when you’re asking for $200,000 and offering the same share?
As noted above, co-founders are good when they bring value to the company, but if their sole purpose is to provide a few hundred or thousand bucks and then disappear into the background, you’re harming your business and your chances of getting investment.
4. Use Funding Platforms
Finally, if you’re struggling to get funding for your business, use a crowd-funding platform like Kickstarter, IndieGoGo, or the countless other options out there.
This is one of the few times when a good idea is more valuable than a good structure, because you’re appealing to everyday consumers, and not skilled investors.
However, for every crowd-funding success story, there are several failures, and this is often because they lack that structure.
A great engineer might create a product, offer rewards, set goals, and then plan for the future. But once that money rolls in, they quickly realize that getting a product to market and promoting it properly is much more expensive than they initially thought.
The money runs out, the backers are disappointed, and the business goes under.
You will still need a proper plan and should also get some skilled employees and/or co-founders on board, but the beauty of Kickstarter is that you don’t need to worry about those things until you have the money.
And just because you have received backing on Kickstarter, doesn’t mean you can’t approach investors like Matt.
A successful Kickstarter campaign is a great way to entice richer and more powerful investors, as you have proof of concept, have shown that you’re capable of marketing your product, and have a number of readymade customers willing to support you.
This is 2020, and you have a world of investment opportunities at your disposal, from LinkedIn networks that allow you to speak with investors and business owners, to sites like Kickstarter (or GoFundMe, for nonprofits) to help you get investments from consumers.
5. Stop Focusing On The Transaction
There is one piece of advice that Matt, Neil Patel (an SEO expert), and Habib Salo (co-owner of Young Nails Inc.) all provided.
It’s advice that so many business owners and entrepreneurs ignore, yet it’s something that you’ll find at the heart of every successful business plan:
Focus on providing value, not completing a transaction.
It seems counterintuitive, and that’s why it’s often ignored, but it can be the difference between success and failure.
Matt used a hypothetical service as an example, one that functioned like Airbnb, but focused on boat rentals. The first concern for this business, as with any business, is to drive visitors to the website and to increase sales. But simply publishing promotional materials and asking everyone to sign up isn’t going to get the job done.
You need to become an expert in your space. Tell people why they should use your service, why they would want to rent a boat, and write about the many different experiences they can have.
It works on so many levels.
On an SEO level, it increases your rankings and places your business in a more prominent position, thus increasing organic traffic to your site. On a customer level, it helps to turn those “window shoppers” into actual buyers.
As for social media, it allows you to create a strong base of followers who respect your decisions, consume your content, and are more likely to listen to you in the future.
Think about it this way:
Is the average consumer more likely to buy something from their favorite Youtuber/Influencer or from a company they saw once on Google Ads?
Trust goes a very long way and, in an age where ads are commonplace, easy to ignore, and increasingly frustrating to deal with, consumers are focusing more on brands that actually provide value.
The “value first” attitude doesn’t just apply to established brands looking for end consumers, it also works for business owners seeking investment.
Matt recommends signing up to LinkedIn and using it to build a professional brand. Put yourself out there, get yourself on the radar of investors and business experts, and stay active, from writing regular posts on the topics you’re interested in, to commenting on other posts and making connections.
A founder shouldn’t hide in the shadows. They shouldn’t hide from the world. But at the same time, they don’t need to be the next Kim Kardashian; they don’t need millions of followers and celebrity status.
In the words of Matt Higgins, just own your story, and if you’re feeling embarrassed or ashamed about putting yourself out there, don’t be. No one cares. Matt is a high-school dropout, but he doesn’t hide from that fact because he knows it didn’t hold him back.
In Matt’s words:
“Whatever shame you have, own it, redeem itself, and understand that you will eventually be judged not by how you started, but by how you ended, and how much distance you covered between these two points”.
6. You Have No Excuse
How many times have you seen an idea on Shark Tank and heard the words, “That’s my idea!” screamed by a friend or family member?
You may have even been the one shouting.
It’s something we’ve all heard at one point and it highlights one of the biggest problems with business, something that many aspiring investors and founders don’t understand:
There’s more to a business than an idea.
That may seem like an obvious statement, but you’d be surprised at how often it’s overlooked.
The truth is, people just don’t acknowledge how much work goes into bringing an idea to life and often dismiss successful inventors and innovators as being lucky or relying on a game-changing idea.
Take Sara Blakley as an example, one of the richest women in the world following the launch of Spanx.
One night, while preparing for a party, she couldn’t find the right hosier to wear underneath her white pants and was inspired to create something suitable. She wanted something comfortable, form-fitting, and neutral, while making the wearer look thinner.
It’s an idea that countless women probably had before her and one that many women likely had at the same time.
The difference is that they weren’t the ones who maxed out their credit cards, fought hard to get the product into department stores, and worked full-time from morning to night to make it work.
You, your friend, or your uncle might have had the same idea as the people you just saw pitching on Shark Tank, but the difference is that they went beyond a simple idea and actually founded a company, created a product, and sold it to consumers.
There are over 7 billion people on this planet, and you can guarantee that any “original” idea you have today, tomorrow, or next year has already been had by thousands of people before you.
Ideas are free and easy to come by. The key to success is in how you propagate that idea and whether or not you have the determination and the work ethic to make it work.
Thirty years ago, you had every right to bemoan your luck when someone had the same idea as you and beat you to the punch. But today, there’s no excuse.
Platforms like WooCommerce and Shopify mean it has never been easier to launch a business and sell a product, while Kickstarter and IndieGoGo make it much easier to get adequate funding.
It’s an exciting time to be alive, a time where crafty entrepreneurs and innovative intellectuals can turn their ideas into profit.
No one is reading your mind and stealing an idea you dreamt up in the shower three years ago. No one cares about the hypothetical business you once told your great uncle about after a few too many beers.
Stop bemoaning your luck, stop getting angry at nonexistent idea thieves, and if you are confident you have a good idea, start implementing it.
The Manifestor Mindset
We all have ideas; we all dream. However, very few people actually implement those ideas and follow those dreams.
Elon Musk is a great example of someone who has the ideas and the desire to implement them. Throughout his career, Musk has introduced radical new concepts and has found ways to make them work.
The vision, the idea, is only a small part of the puzzle. What matters is how that vision is realized and what it takes to bring it to life, to manifest it.
This is a topic that Matt discusses at length on his podcast The Manifestor Mindset. He interviews people who have big ideas, but also know how to implement them and are not afraid to take risks and put themselves out there.
Matt hopes that these interviews will inspire others to act on their dreams and to take the first steps in turning their ideas into businesses.
I had the pleasure of conducting a customer acquisition masterclass with Matt a couple of months ago, in which we discussed some of the ways you can attract more customers to your business and improve your ROI.
He has also conducted interviews with investor and actor Patrick Schwarzenegger, Shark Tank’s Kevin O’Leary, and a host of e-commerce and marketing experts.
These videos, and a wealth of other great info, is available at MattHiggins.com, and you can also watch some Manifestor Mindset interviews on Matt’s Youtube channel.
About Our Guest: Matt Higgins
Meet Matt Higgins. Matt is a noted serial entrepreneur and growth equity investor as co-founder and CEO of private investment firm RSE Ventures. He is also vice chairman of the Miami Dolphins, a recurring Shark on ABC’s four-time Emmy-Award-winning TV show Shark Tank, and Executive Fellow at the Harvard Business School.
Higgins began his career in public service as a journalist before becoming the youngest mayoral press secretary in New York City at 26, where he managed the global media response to the September 11th terrorist attacks. He became one of the first employees – and ultimately Chief Operating Officer – of the Lower Manhattan Development Corporation, the federally funded government agency created to plan the rebuilding of the World Trade Center site. Higgins helped organize the largest international design competition in history culminating in Reflecting Absence, the September 11th National Memorial, and the development of the 1,776-feet-tall One World Trade Center, the tallest building in the northern hemisphere.
Higgins cofounded New York City based RSE Ventures in 2012, amassing a multi-billion-dollar investment portfolio of leading brands across sports and entertainment, media and marketing, consumer and technology industries – including several of Fast Company’s Most Innovative Companies.
RSE has successfully backed many challenger brands from inception, including RESY, an Open Table competitor that American Express acquired in 2019; the world’s premier drone racing circuit, the Drone Racing League; and the International Champions Cup, the largest privately owned soccer tournament featuring Europe’s top clubs. Higgins is also co-owner of VaynerMedia, founded by digital marketing expert Gary Vaynerchuk, and a partner in early-stage venture fund Vayner/RSE.
In 2013, Higgins co-founded Derris, a brand strategy and communications firm that has helped grow many leading brands such as Warby Parker and Glossier. In 2016, he broadened RSE’s investment focus to rapidly expanding fine dining and fast casual concepts, including David Chang’s Momofuku and Fuku, Milk Bar, &pizza and Bluestone Lane.
Higgins received his BA in political science from Queens College and his JD from Fordham Law, where he was a member of the Fordham Law Review. He was named a Top 40 Under 40 executive by Crain’s New York and by Sports Business Journal. In 2019, Higgins received the Ellis Island Medal of Honor – joining the ranks of seven former U.S. presidents, Nobel Prize winners and others who have made it their mission to share their knowledge, compassion and generosity with those less fortunate. He is a longstanding board member of Autism Speaks.