Ep652: Adam Rosen – Build to Sell From the Start

Andrew Stotz 00:02
Hello fellow risk takers and welcome to my worst investment ever stories of loss to keep you winning. In our community. We know that to win in investing, you must take risk but to win big, you've got to reduce it. Ladies and gentlemen, I'm on a mission to help 1 million people reduce risk in their lives to join me, go to my worst investment ever.com and sign up for our free weekly become a better investor newsletter where I share how to reduce risks, create and grow and protect your wealth. Fellow risk takers this is your worst podcast host Andrew Stotz from a Stotz Academy, and I'm here with feature guests, Adam Rosen, Adam, are you ready to join the mission?

Adam Rosen 00:40
Let's do it. I'm ready.

Andrew Stotz 00:41
I am excited to have you on and I'll introduce you to the audience. Adam Rosen is an entrepreneur who loves to support business owners and share his roller coaster startup journey to help those on a similar path. He is the founder of e mail outreach company, where they do automated email outreach to get startups onto more sales appointments without the hassle. Adam, take a minute and tell us about the unique value that you're bringing to this wonderful world.

Adam Rosen 01:13
Yeah, well, first and foremost, thank you, Andrew, I appreciate you having me on. I love the work you're doing. So I appreciate you having me. So I never thought that I would get an intro like the one you just gave where I'm running a cold email outreach company. Because it's one of those things that nobody likes to do. Nobody wants to do it. But every single business needs to do it. It doesn't matter if you're a teeny tiny one person startup or a large fortune 50 company. Everybody needs more top of the funnel, and a great way to get more top of the funnel, and be through cold email outreach, if you know what you're doing. So yeah, we started the business about two years ago now, it was very much just a kind of a one of those things where I talked to one of startups and I was advising, he said, Hey, Adam, can you talk to my head of sales, she's struggling to get meetings on the books, I call that my co founder, my previous tech startup. And long story short, that's when we built out the first version of the company.

Andrew Stotz 02:07
So tell us how someone listening I mean, I think we can go with the assumption that everybody knows, hey, you've got to work on emails, and you got to work on top of the funnel, all that stuff. The question is, how? How do you help with that? And how does the listener learn more about that.

Adam Rosen 02:29
So number one, we could just take everything off of your plate. So the majority of the work that we do is full service for our clients, where we do everything from getting the email list for the people that we're going to reach out to writing the copy of that primary email, writing the eight follow ups, because we do a nine point email sequence to manage the entire inbox, you know, so for every meeting that we booked for a customer, they don't know it, but there's 10s, if not hundreds of response that people say, Hey, thanks for reaching out, but I'm not interested. So we manage the entire process, we put our clients, we book a meeting right on our clients calendar, then they take it from there. So that's the primary way we work with our customers. But now we've gotten really good at email deliverability, helping our customers not land in spam. So for companies that are in the spam inbox, they'll come in spam and not going into the inbox, they'll come to us, we'll get them out of spam. We'll teach people on how to write emails that they could do it themselves, we'll get them email list. So we have other services. But the primary way is, Hey, you want to get more sales appointments. And you don't want to deal with all that other crap, we'll take it off your plate, we'll do it for you.

Andrew Stotz 03:33
And for the typical person listening, including myself, like oh, man, that's going to be super expensive, and it's going to be problematic. And the email in which email address we send it out of and how we you know, all of those complications. How do you deal with those objections?

Adam Rosen 03:51
Well, we broke it down even we're a more cost effective way, then even higher internally with your own SDR. So we broke it down detail by detail, to have a pretty darn good ROI calculator to show that, hey, we're gonna be less money, we're gonna produce better results, and we're going to be a lot less of a hassle than hiring internally. And that's why a lot of startups specifically what we're working with the C suite on the startups, they evaluate where they're like, We don't have to worry about you, we know you're going to do a great job, you're gonna get me on appointments and have to deal with all the other crap that goes into it.

Andrew Stotz 04:21
And I'm looking at your website right now. Email, it looks like E O C works.com. Is that correct? Yep, you got it. And it says more sales appointments, hassle free. Nice. And so for a person listening in or viewing this that says, Okay, I want to, I think I need to engage. What's their next step? Go to the website.

Adam Rosen 04:47
Yeah, number one, it's figuring out do you sell a high ticket enough item that's worth it to work with a company like mine. So I always say, if your ACV your annual contract value is under 10k. A, we're probably not a fit to work together, at least from a full service perspective. Now, can we help with some of our additional services? Yes, but not full service, because it's just too difficult to justify the CAC, the cost of acquiring a customer. So that's number one. But then number two, if you do value meetings with prospects reach out, and at the very least, I'm happy to provide feedback on how you can do it more effectively, if not just handing over the keys so that we can do a great job for you to get you more sales appointments.

Andrew Stotz 05:27
So let's say that you have an average contract value of $20,000 as an exempt example. So okay, you fit into that category that this could be good for you. What's tell us about the process? Like for instance, if that person's listening, and they say, I want to, I want to sign up for this, I need this. How long does it take before they see results? How are they paying what's the amount of work that they've got to do or how seamless is this for them?

Adam Rosen 05:53
We built this for startups, specifically selling directly to the CEO. So they don't have time, they don't have a long ramp period, they don't have a lot of time that they can invest into this, the whole point is taking this off your plate. So the ramp period is three weeks when we start decide to start working together, before we send out the first email. The reason why is we create a new domain for you new emails for you. And there's a lot of warmup that goes into it. So that before we start, you know, the outpouring of emails that we're going to do, we want to make sure that you're landing in the inbox. So it takes about two to three weeks to get it ready to start sending out emails. And then we're booking appointments, sometimes in that first day, but at the very least, in that first week, to put some color on it. One of the companies that started a three month pilot with us, we always put a guarantee for them, hey, you should guarantee we guarantee at least four appointments in a month. So you never have to worry about not at least getting that our pricing structure where we want to get you on as many appointments as possible. With this particular startup in the first month, we got them on 18 sales appointments. So you know, we got to what I call email market fit very quickly, we try to get that as quickly as possible. Sometimes it takes a little longer than others. But we always get your meetings within the first week, I've never seen a customer start, we don't get them the meeting, at least in the first week.

Andrew Stotz 07:08
And so what you've talked about is okay, there's some infrastructure you got to put in place to get it done, right. And so domains and emails and all that and then getting the copy and getting it out. But it sounds like results come pretty quickly. What do you do for startups and owners that basically say, oh, yeah, but my, the target of my email needs to be someone that you're probably not good at, or they could be in a different country. They're in a particular industry that could be this that I'm sure that there's a lot of objection there. How do you handle that?

Adam Rosen 07:39
At this point, I got MasterCard as a client in my tech startup from cold emailing RJ Bonga. Now their former CEO. So one of the busiest most successful people in the world, gotten three phone calls, pass this to ch RO, and they bought one of our customers, they have a luxury campground, they want to reach out to influencers, we got them. Someone from the tenant, a wide receiver for the Tennessee Titans. We had a Facebook, we have a faith based movie that's working with us. They're focused on reaching out to churches, were loaded up their calendar with priests, pastors, etc. So at this point, we booked a meeting, we just met anybody. So I would say if there's an email for them, we'll do a hell of a job, we'll probably do a pretty darn good job again, you get you on an appointment with that

Andrew Stotz 08:23
just fires you up when you hear that, you know, and I know for any listener, that's got a business that's trying to expand. That's just that's fire talk. Adam. One last thing, is there anything that you don't do or you can't do? Obviously, if something's a low contract value, it's just not worth it. There's not enough revenue to recoup what you guys need to be paid. Is there anything that you don't do?

Adam Rosen 08:47
We haven't worked for any political campaigns, you know, where they'll reach out to their email database. So that's one. Not saying I wouldn't do it. But we haven't done that yet. And we try to focus on b2b Like, we've done outreach to get people on podcasts. We've done influencer outreach, like I shared a little bit earlier. But I really like to focus on how do we bring our customers money. As we all know, cash flow is everything in a business, especially a startup. So I love when our customers tell us, hey, we just landed and we just gotten this email recently, a $250,000 deal that could turn into a $500,000 plus deal from our outreach. So that's the stuff that lights me up and gets me excited because I know how important especially for bootstrap stores, but really any startup how important cash flow is. So I prefer b2b. That's really where it focuses.

Andrew Stotz 09:35
I heard someone say something that the other day that I just love, and I repeated all the time now and that is about his startup. He said, We're customer financed. Yep, meaning revenue finance. So I love the last question is just how do you charge what's the payment structure?

Adam Rosen 09:54
We charge a monthly fee plus commission. Commission is either off of every sale that you make, from One of the meetings we set up, or we charge commission off of every meeting that we successfully booked for you. So you got in the meeting, it was a good meeting for you. The other way that we recently introduced was just a flat fee option, which customers tend to like doing now because they see that they pay us a lot more money in commissions from the good work that we're doing, but can either be a lower monthly plus commission, or slightly higher monthly, no commission.

Andrew Stotz 10:23
Ladies and gentlemen, if you're not fired up, I don't know what's going to fire you up. If you got to start up and you've got a business, it's got to expand, just go to E O C works.com. All right, Adam, now it's time to share your worst investment ever. And since no one goes into their worst investment thinking will be tell us about the circumstances leading up to it, then tell us your story.

Adam Rosen 10:44
Yeah, so first and foremost, I want to say the thing that I resonate a lot with with with your podcast is, it's one of my beefs with the startup world is I feel like, we always want to talk about the sunshine and the rainbows and these quote, unquote, overnight successes. And as we all know, it is BS, it is just not real. And when I was in college, I took an entrepreneurship class, I knew nothing about entrepreneurship. Then my professor at the time, she was starting entrepreneur program. So I led that program, getting into an internship, my senior went, Well, I did an MBA. And then three weeks before I graduated with that MBA, I started a business with my original two co founders. And I was a bright eyed, bushy tailed, you know, young, 22 year old kid, and thinking like, hey, it's billionaire bus IPO or bus, I'm going to do this till the day I die. Like, here's my startup. And that tees it all up to being my worst financial investment ever. Hands down, I cost myself insane amounts of short term money worth insane amounts of hours, if you broke down my hourly rate, it was probably anywhere from 25 cents an hour to 50 cents an hour, if I'm being nice to myself. So for me, you know, coming out of college, I had a great opportunity to make a good amount of money. And I decided to start my first business. In the first year of that company, if we were not funded, I didn't take $1 I worked in a restaurant the weekend so that my bank account wouldn't just be a straight 90 degree free for all instead, it would be a slow demise. And then after a year in, we ended up raising capital. And then for the next four years, we had a roller coaster, a building my startup, raising a little bit of money, having some decent success, but never pay myself. And I'll be very upfront about this more than $40,000 a year. That was it for the first four years. And I was literally living on my credit card for years and years and years and thinking like, Hey, here's gonna be our big break, here's going to be our big break, here's gonna be our big break. And it never happened. And we did sell the company. And we did have an exit back in 2019. But it wasn't some big glamorous fancy exit, it was one to make sure that our customers could end in a good spot the business could live on which it is. And we can move on to what's next in my co founder nice journey. So it was probably the it was definitely the worst financial short term mistake I can make. But it was the best investment ever. Because every one of the mistakes that I made over that five year stretch, I brought into this business now. And there are so many things that I refuse to do with this business. And so many pillars that my co founder and I focus on each and every day that have made this business successful. And that will hopefully make us a hell of a lot more successful in the future.

Andrew Stotz 13:35
So let's review. First of all, think about the major learnings that you took away from them. But also, what are those? How are you bringing those into your current company?

Adam Rosen 13:46
A couple of main things stick out with that, Andrew. So number one is product market fit. Every single company, I always recommend get to product market fit as quickly as possible. For any business churn can be just demoralizing, devastating, and a killer for any business. And that was our biggest problem is we were good at getting new customers. And the reason why is because of you know what we do now which is cold with cold email we were always getting new at bats getting big customers from it. But churn was a big problem. And the reason why is because we never got to product market fit. So with this business email outreach company, you know, we like to sell we like to get new business we like a lot of action. We like the energy that new customers bring. But for the first 10 months or so, we kept our three beta customers didn't bring on a single other customer. We were in the inboxes responding to every email feeling ever groove of the process because we knew we didn't want to grow this business until we knew we had something that people didn't just want to buy once but want to buy a second and a third time and a fourth time etc etc. And they also want to pay us more money because we're providing additional additional value. So that's number one is to get to product market fit as quickly as possible.

Andrew Stotz 15:01
Maybe I'll share a few things that I take away from your story. The first thing I take away from the story is that startup startup is a trap. Ultimately, you're gonna be in it for five years, 10 years, you know, and you're not gonna be able to get out of it very easily. It's not like you can just walk away. And so first thing to think about for everybody, as you get into startup world is that you're going to be trapped in that situation. And you better be damn sure you're in with the right people, you're doing the right thing, and all that. But even if you try really hard to make sure that all those things work, right, you're just going to, you're going to be trapped. So once you understand that, then you go in with your eyes wide open as to what I'm getting what you're getting into. So that's the first thing. The second thing is, you know, as a valuation guy that spends my life looking at startups and businesses and valuing them. Startups asked me the question, how, how do I get a higher exit price? And I always say, the same thing. I said, Oh, that's easy. I mean, in fact, you could, you could make this one change that I'm going to tell you to do today. And it's going to guarantee that you're going to get a higher exit price. And they say, Well, what's that, I'll do that I said, double your salary. And they said, How's doubling my salary going to help with that? And I said, because you're underpaying yourself guaranteed. In fact, you need to double the salary, the whole management team, you need to make sure everybody's paid at a market rate. And you're gonna find out very quickly, whether you're a profitable company or not. And because your acquirer is going to be looking at that, because they're gonna say, Well, what if everybody leaves and I've got to go out in the market and hire these people and market prices. So the thing that I was just thinking about that it reminds me is it, there's no badge of honor in the startup world by talking about how you're not paying yourself? If you're doing that, stop, and think about it. Now, that made me that, okay, I can't do it today. But you better be ramping that up. And if your business can't handle that higher cost of your, then then you may just have a hobby, unfortunately, and that I just want to talk also about product market fit because I think actually you really talked about the benefit of product market fit is retention. You know, the whole thing I mean, like the membership model and getting recurring revenue, and all that's all comes down to retention. And that is that you're delivering something that the client doesn't want to end. We need this. And we want to always use that. And that's really the key. I mean, I think about zoom as an example. I started this podcast a long time ago. And I've done 650 or so episodes, and I've done them all on Zoom. And I never want to stop paying zoom, because it's been flawless. I mean, I've had never had a technical issue. And so the result is that I just want to keep paying them so that that continues so. And product market fit is so hard sometimes. And I would say that every single entrepreneur starts with their dream product or service. So you're guaranteed that product market fit is going to be the first problem you're going to face. So those are the three things The first one started as a trap. The second one is, you know, double your value by paying yourself market prices. And then the third one is that product market fit is about retention. And most every startups got to go through that you better do it sooner rather than later. Anything you would add to that?

Adam Rosen 18:35
Well, on the retention piece, it's so important because even for the business, now, we don't lock anyone into your loan contracts. I like being on a chopping block every month, and they're in stripe, and it's gonna get charged once a month unless they tell stop working with us. And that almost never happens. And for us, that's the real barometer. Because in our previous business, we did your loan contracts, and you're always taught getting your loan contract, and there's a lot of value in that. Sure, absolutely. I get it. But for me, I think there's so much more value in every single month, the customer saying yes to you. Because for business owners, you want to find the reality of your business as quickly as possible. Whether it's good, you know, you're trending in the right direction, everything is positive. Or if it's bad, I would rather know I need to change stuff because customers are pulling out versus I got people in a year long contract and I'm just gonna sit back and wait for the next 910 months thinking everything is peaches and roses. So I like being on the chopping block every month and it's a test are we performing? And if we are the market is going to tell us we're performance.

Andrew Stotz 19:35
Because ultimately to make us business successful, it's got to be voluntary, that people are saying I'm searching this out and I don't want to leave it. This is what I mean. I started a membership last year, and I did a very low price point for friends and family and people that I know. And it did like a founder's membership because I wasn't sure exactly the value I was going to deliver how I was going to deliver it and all that but Man, every month is a test. Every month we'll put to the test. And you know, we lost some people. But generally, we've kind of had a pretty steady thing. So I think that challenge yourself, ladies and gentlemen go on a monthly payment schedule and see, you'll get feedback a lot quicker than if you're on an annual contract, you think you're, you're smart by hooking in that annual contract. But you may want to go to your client, your first clients to say, Pay me on a monthly basis. Fantastic. All right. So let me ask you, let's go back in time in, you know, you've learned all that you've learned and think about a young person in the same type of situation all pumped up during their startup, based upon what you learned from this story and what you continue to learn. What action would you recommend our listeners take to avoid suffering the same fate?

Adam Rosen 20:54
Focus on profitability, and more importantly, profitable systems. So everything that my co founder and I talk about all the time, one of our key pillars is profitable r&d. So we'll do research we'll do we'll try new things, but it needs to be profitable. And one of the big mistakes I think a lot of people get tricked to in the startup world. I know I did send that with a, you know, serial entrepreneur this probably four or five years ago, and the guy was like, Adam, red is the New Black, red is the New Black. Don't worry if you're losing money, you just want to scale scale scale. And sure that can work for some Silicon Valley startups. Absolutely. But for all of our businesses, it's really simple. It's can you get new customers? Can you keep those customers? And can you make it profitable. So that's my advice to every new founder is, hey, focus on profitability, and focus on your systems. And on top of all that build, to sell from the start every day, and I think again, back to me being a bright eyed, bushy tailed young entrepreneur that didn't know a damn thing. And I'm like, I want to build this for the rest of my life IPO or bust. When I hear somebody say that, I just think you're a pup just like I was a pup. And I had great mentors that recommended Adam, it'll build to sell. And I didn't do it soon enough. But I believe every single business owner has a responsibility to build their company to sell it from the start. Because if you do that, a couple of things are going to happen. Either one, you can choose to sell your company in great, have an exit and move on to something else. Or to you have a company that is clearly successful, clearly working and most likely can scale if somebody else wants to buy it, and hey, keep running it and operating on your own. So every company needs to build a cell from the start. I didn't do a good job of that in the in the beginning of my first company now is recommend every single entrepreneur to do this to the saint that

Andrew Stotz 22:46
profitable r&d and build to sell. Excellent. So let me ask you, what's a resource that you'd recommend of your own companies or anything else feel free?

Adam Rosen 22:56
Yeah, for anybody who wants more sales appointments, if anyone is doing cold email on their own, and it's not working, maybe you're ending up in spam, maybe you're not getting the responses you want. Go to eocworks.com You can book right through my calendar directly on the website, happy to have a conversation with you about either us doing this for you, helping you with your current approach, or just talking startup sales and getting more sales opportunities.

Andrew Stotz 23:19
Fantastic. All right. Last question, what's your number one goal for the next 12 months?

Adam Rosen 23:25
number one goal is to have a company offer to acquire my company over the next 12 months doesn't mean I'm gonna accept it. But I want to have a good offer for 2x revenue to be more specific. And on top of that to kind of a one a just be happy, enjoy life and keep traveling the world which is what I'm doing. So those are the one in the one a

Andrew Stotz 23:46
fantastic. All right listeners. There you have it another story of laws to keep you winning. Remember, I'm on a mission to help 1 million people reduce risk in their lives. If you haven't joined, just go to my worst investment ever.com right now and join the free weekly become a better investor newsletter to reduce risk in your life. Well, as we conclude, Adam, I want to thank you again for joining our mission and on behalf of a Stotz Academy I hereby award you alumni status for turning your worst investment ever into your best teaching moment. Do you have any parting words for the audience?

Adam Rosen 24:19
Thank you, Andrew. Keep up the good work and forever buddy. Just just keep on going. Perseverance and spirit have done wonders in all ages.

Andrew Stotz 24:25
Fantastic. And that's a wrap on another great story to help us create, grow and protect our well fellow risk takers. Let's celebrate that today. We added one more person to our mission to help 1 million people reduce risk in their lives. This is your worst podcast hose Andrew Stotz saying. I'll see you on the upside.