Welcome to the Scaling Thursday edition of Make Money Your Honey Live! Today we’re covering Opportunity Cost Explained Part 2.
On Monday’s segment, I defined what opportunity cost is and one of the main ways people screw themselves. Instead of investing in mentorship and education, they insist on figuring everything out themselves. Mostly because they are afraid of investing funds.
This ends up costing them MORE money in the long run and they end up wasting a whole lot of time (which is more valuable than money).
In today’s Opportunity Cost Explained Part 2, I’m covering the second way business owners screw themselves – they don’t hire people! And then, when they do hire people – they hire the wrong people! (Segment for another time).
So this is the scaling segment for members of my audience who are more advanced. Today we’re going to be talking specifically about how not building a team is a major opportunity cost for you.
Now, if you’re not there yet in your own business I still want you to listen. One of the biggest mistakes I’ve ever made – other than not investing funds in mentorship – was not thinking big enough. I never dreamed I’d have a team because I thought I could do everything myself and it would be just fine.
Well, it’s bullshit.
And I don’t know why so many of us have to learn this the hard way.
Actually, I do know why.
People are afraid of hiring people and investing in help. They are afraid of committing funds to salaries. They are afraid of releasing funds because they don’t believe they can make the money back. That’s the main blockage so let’s address that first.
Opportunity Cost Explained: How Not Hiring People Costs You Money
So here’s the thing. You CANNOT do everything yourself. As I mentioned on Monday, it’s egoic to even think you can. Quite frankly, you’re not THAT smart or special. You have certain gifts and talents and other people have certain gifts and talents that complement your own.
Financial Team Example
Let’s use the example of financial teams, since people insist that financial teams cost too much money so they’d rather do their own bookkeeping and taxes.
For example, I’m really good at marketing and sales – and I love it. Despite popular belief, I am not good at numbers. The sight of a spreadsheet makes my eyes bleed. I’m not good at tracking metrics (though I have gotten better) and I couldn’t figure out what those metrics are on my own even if I tried. I also don’t know jack shit about taxes.
So what did I do? I hired a financial team. First with an accountant and bookkeeper many years ago. That guy pays for himself. Then, as of a few months ago, a CFO to help me track the financials of the company (which by the way has been a learning curve for me). She’s already paid for herself just with the amount of money we’re saving let alone our plan for moving forward.
Numbers is their forte, not mine. Just like creative is not their forte, but it is mine.
So what if I was asinine enough to believe that I could do bookkeeping and taxes on my own? First of all, I don’t fucking want to. Second, it is NOT the best use of my time. The best use of my time right now is doing stuff like this and working in conjuction with my sales team. That leads to more visibility, warm leads and MORE money in the bank. Me fighting with Quickbooks doesn’t do shit.
So to get back to opportunity cost explained, if I’m wasting hours each week on financials, it’s taking time away from income-generating activities. So I end up losing MORE money than it costs me to just hire people.
The Solopreneur Will Get Screwed In This Crisis
Here’s the deal – and I’m only saying this because I’ve learned the hard way – solopreneurs get screwed. They get screwed because they create another job for themselves. Solopreneurs are getting screwed in this crisis because the are drowning trying to keep up with everything themselves. The reason I’m able to be THIS visible right now is because I have team and systems, otherwise my ass would be drowning too.
Now, I know we have lots of solopreneurs in the audience and that’s okay. Everyone starts somewhere and in the beginning yes- it’s on you. Your first investment should be mentorship to get you to a stage where you can start considering building teams.
The key is not to stay stuck there.