Ryan Deiss: I’m already on fire. I’m already ignited. It’s happened. It happened even before I signed up I was so excited. Yeah, before I walked in.

John: I love it. Fire Nation. Ryan, if you don’t know this already, is a co-founder and CEO of DigitalMarketer.com and host of the Traffic and Conversion Summit, which is the largest digital marketing conference in North America. He’s the founder of dozens – count them, dozens of companies, selling everything from makeup brushes to crossbows to even industrial water filters. Ryan, take a minute, fill in some gaps from that intro, and give us a little glimpse of your personal life.

Ryan Deiss: Yeah, so I mean the only thing I would add to that intro is that maybe it makes me sound cooler than I deserve because you hear about all these different businesses and things like that. What that really means is I suffer from an extreme case of entrepreneurial ADD, and so if I were actually to focus on any one of those things, I’m sure that I would probably be a lot more successful and have a lot more free time, but that doesn’t sound like very much fun to me. So, as a result instead, yeah, we’ve scaled our different systems and processes in lots and lots and lots of different industries, lots of different verticals and product types.

What’s cool about that is when I talk about it through DigitalMarketer, it means that the things that we teach, I know that they don’t just work when you’re selling marketing stuff to marketers. It works across all of these different industries and verticals, so that’s a lot of fun. Aside from that, let’s see, married for almost 15 years, four awesome kids, and so I don’t ever really get to do anything alone. I guess that’s the best way – I’m constantly surrounded by human beings, but it’s great. Yeah, great life, good times.

John: But don’t you have this great podcast in your studio you were talking about? Can’t you kind of hide away in there a little bit?

Ryan Deiss: I am. That’s exactly – I totally forgot that we were even doing this. I was actually just in the studio curled up in a ball hiding from strangers.

John: Totally in the fetal position. I love it.

Ryan Deiss: Yeah, the timing worked out.

John: Ryan, you are really, really good at a lot of things. You’re great at a few things, but what would you say the one thing is that you would say is your area of expertise?

Ryan Deiss: The thing that we’ve always been good at and that, frankly, has saved my butt more than a few times is I’m really good at acquiring customers profitably, right? Profitably and predictably, so any market we go into we can generally figure out, “Okay, this is how we’re going to go about turning strangers into friends into customers into raving fans,” and that process has really formed the foundation of everything that we do. And if you can get customers, there’s a lot of stuff you can be bad at and still make things work out.

John: So, what’s something that you find over and over again that entrepreneurs just struggle with when it comes to that area of expertise of acquiring customers profitably and predictably? What’s something that we all struggle with that you think that we should really know as entrepreneurs that we just, frankly, don’t?

Ryan Deiss: It’s coming up with a clear and concise way to articulate your value to someone who has no idea who you are. So, oftentimes when we start a new business, the first people we talk to are our friends and family, and that’s great. But because they already know us, when we tell them about our idea they’re like, “Oh my god, that’s genius,” right? “I think it’s great.” Now when you go out to strangers, they’re like, “Okay, I don’t understand exactly what the heck is going on.” So, figuring out how to clearly and concisely articulate: okay, this is the value that we bring, and value means this is how we change people.

I say all the time, this is your job if you’re in business. You’ve got one job and one job only, and that is to move people, to shift them from less desirable before states to a more desirable after state. Right, like that’s it! That’s all you do. Whether you’re selling a product or service, you’re shifting people from less desirable before states to more desirable after states, and all marketing and copywriting really is is articulating that. And so that’s the thing that we’ve gotten pretty good at, and that’s the thing I’ve found that most entrepreneurs struggle with because they’re so dang close to it.

John: Okay, 1.) You have a lot nicer friends that I have. All my friends say, “John, that idea is horrible,” and then I actually get into that fetal position and crawl up and cry for a little while. So, kudos to you for having good friends.

Ryan Deiss: Yeah, actually my friends are evil. It’s actually my mom that’s like, “I think it’s a great idea.”

John: Oh, it’s your mom.

Ryan Deiss: Yeah, my friends are just pure evil.

John: So, I kinda maybe just wanted to finish up with this question by saying like how do we get in front of people that aren’t our friends to ask them these questions and to figure out if it’s a good idea or not or what they really need, etc.? How do we get in front of people that don’t know us?

Ryan Deiss: Yeah, such a great question. Most of the people listening are going to, unfortunately, hate my answer, and that’s you have to go out into the world and talk to strangers. And I know that strangers want to stab you and sell you drugs and all that kind of stuff, right? That’s what we were taught, but I’m telling you what I’ve always done is I’ll go to trade shows, and it doesn’t matter. When we initially acquired –

You mentioned I owned an industrial water filter manufacturing company for a while. Spoiler alert, I didn’t know anything about that industry when we acquired that company. So, I went to the next trade show that we were going to, and I talked to people. And I learned a lot, and I learned what the customers wanted. And, for example, we found out – Just a really quick story. We thought that what people wanted were their filters to be the cheapest or the best. What we found out is nobody actually cared about that because, in general, a filter was a filter was a filter.

What they needed, and we asked them straight up, “So, why do you buy from us? It’s a commoditized industry. Why buy from us?” And the thing that we kept hearing again and again and again is, “You guys can get us the filters fast.” And if you’re running, for example, a desalinization plant, which you probably have, right? You live in Puerto Rico, right? So, you’re on an island. You totally get all your stuff through a desalinization plant. If that desalinization plant runs out of sediment filters, that’s it. The plant shuts down. A $14.00 filter could shut down an entire plant.

Now, I didn’t know that. I didn’t think about that. I didn’t understand how the stages of filtering worked, and where we fit in that particular stage. So, the person telling us, they’re like, “Look, $14.00, $14.80, $15.00, it doesn’t matter. If I don’t have this filter, the entire operation shuts down.” And so, in hearing that, I said okay, so my job, I don’t care what I’m selling, I need to shift customers from a less desirable before state to a more desirable after state. So, what’s their less desirable before state? Well, they’re living in constant fear, this procurement manager, this warehouse manager, that they’re gonna run out of this cheap little item. It’s gonna bring everything to a screeching halt. They’re gonna get fired, right?

So, how can we overcome that fear? We can change up our value proposition and stop talking about how great it is, which is what everybody else is talking about. “My product is so great.” “Our customer service is so great.” Screw that. Nobody cares how great you are. They care about their particular thing, right? So, in this care their particular thing is I need to know that it’s there quickly.

So, we said, “Okay, here’s the deal. You order from us, you’re gonna have it in 48 hours or less, even if we gotta eat the shipping.” Right? And we completely rebranded the entire company to Rapid Filter. We’ll get you filters faster, right? So, everything changed, but I never would have done that had I not gone out and talked to people.

When we launched DigitalMarketer HQ, which is kind of our flagship training and certification program at DigitalMarketer. You mentioned Traffic and Conversion Summit, right?

John: Yeah.

Ryan Deiss: We had 3,000 attendees, this was a couple of years ago. This year, by the way, we’re expecting over 6,000, which is crazy. But a couple years ago we had about 3,000 people in the room, and I was planning on selling our certifications, right? Because that’s what we had, and it would make sense like while they’re there. I didn’t do that though. Instead, I sold this new program, HQ, which is all of our certifications in one area designed for team training. But it had the problem, and this is a big, big problem. It didn’t exist yet.

So, what we did is we had budgeted, and we had expected to sell about $500,000 worth of certifications at that event. I gave up all of that revenue, and, instead, said, “We got this new thing that’s coming out. It’s gonna be awesome. It doesn’t exist yet, but I’m going to be at the DigitalMarketer booth all day, and I just want to talk to people.” And so instead of collecting $500,000, I sat at my booth and had hundreds of conversations with people, which, as an introvert, is terrifying. But in that one day, I gathered millions of dollars worth of information. All the copy was written, everything, because I talked to human beings who were our customers in the flesh. I figured out what our ideal sales conversation is. I figured out what the hook is.

And I’m good at this stuff, but I’m only never right when I try to come up with it on my own. When I talk to customers first, then that’s when we can figure it out, and you don’t even have to be that good. You just have to be willing to do the work.

John: So, Ryan, you’re a big deal in the entrepreneurial world. I mean people know you and just proof of concept here. I do 30 interviews in two days. I book two days a month. I do back-to-back interviews, 15 on one day, 15 on the second day. So, yesterday morning when I was starting this – You’re actually number 24 of 30 of the last two days. I took a picture of my calendar, posted it on Facebook, and so there’s 30 names up there. And underneath that a lot of people are commenting and stuff, and all of the people are just saying, “Oh my god. I can’t believe you’re interviewing Ryan Deiss. Ryan Deiss this. Ryan Deiss that on Fire Nation.”

I think you’re hearing why people feel this way about Ryan because he shares the specific examples. He walks the walk. He talks the talk, but I still have to be honest. Ryan hasn’t always just been talking rainbows and unicorns; he’s had some tough times too. We all have, and Ryan that’s what I want you to share with us right now. I want you to take us, Fire Nation, to your worst entrepreneurial moment to date. Take us to that moment, Ryan. Tell us that story.

Ryan Deiss: This is surprisingly difficult to pick, actually, because I’ve had some bad ones. There’s been a lot, but there was one in particular. It was like the only time in my adult life that I actually cried. I was sitting on the couch. I’m almost coming up on the ten-year anniversary of this happening, so this was about nine years ago. And I’m sitting on my couch, and it’s a Sunday night. I remember it just like it was yesterday. Sunday night, sitting on the couch next to my wife, kids are in bed, enjoying the evening, and I get a call. And it was my accountant, and I now know that it’s bad when your accountant calls you on a Sunday night, right?

And then my accountant said words like that went something like this, “Hey Ryan, I wanted to make sure that we chatted before we get into this week because wow, you had a really good year last year.” Okay, I now know that it’s bad when your accountant says, “Wow, you had a good year last year.” That’s not actually a compliment. Accountants don’t care about that. That’s their code of saying, “You owe so much more in taxes than you have set aside. Please tell me that you have some money squirreled away because from the quarterlies, all this is not there.” And it turned out I was in about $250,000 worth of debt to the IRS.

Now, the truth of the matter is I didn’t have the money squirreled away anywhere. The business was doing okay, but prior to that, I got myself in another hole where I was a $250,000 in debt to credit card companies. And I had just dug out of that hole, and the way that I dug out of that hole was by not paying taxes, right? Which was really, really stupid, right? Because if you’re not going to pay somebody, at least pay the one that own missiles, right? That’s just a good rule for life. That’s a writer-downer. I’d do that. Pay the ones with missiles and who could throw you in jail.

And in all honesty, it’s not like I was driving Lambos and everything like that. I was like a lot of entrepreneurs, right? I’m reinvesting in the company. I’m trying stuff. Some of it’s working out, a lot of it isn’t, making lots of money, not keeping that much, not really knowing what the heck I’m doing. And I just remember hanging up the phone and just sitting there next to my wife, and I got, at the time, three kids asleep upstairs. I’m sorry, at the time it was only two kids asleep upstairs.

I got a couple kids asleep upstairs, and I remember sitting there by myself crying. Like, “Oh man. I don’t have it. We don’t have it. I don’t know how I’m gonna do this. I’m going to have to sell the house, and we’re gonna have to do all this stuff, and I failed. I failed in every way, shape or form.” And I sat there and must have just pouted and cried for a good 30 to 45 minutes, and my wife said nothing. And then after I was kinda done, she said, “Well, I don’t understand why you’re so upset. You’ll figure it out. You always do.” And I remember then being like, “Thank you?”

It’s like it was a compliment, but it wasn’t necessarily what I wanted to hear at that moment. I wanted the sympathy, but my wife knows me well enough to know that she needed to encourage me in that. And she needed to tell me like, “I’m here. I’m not going anywhere, but you’ll figure this out, you always do,” and to her credit. So, the phone call came on a Sunday night. I had to write a check by Thursday to the IRS, and I asked my wife, “Can I just have 24 hours to mope? Just give me 24 hours to mope and feel sorry for myself.” She said, “Fine, you’ve got 24 hours.”

So, I spent all of Monday moping. I think the phone call came in around like 7:00 p.m. or 8:00 p.m. the night before. So, around 7:00 p.m. or 8:00 p.m. the next night, I got busy. I got to work. I was creating new offers, writing copy. Fortunately, I did have a number of businesses in a number of different markets, so I could produce a bunch of different campaigns. And I pulled an all-nighter and crafted like six different sales and promotions and campaigns.

And by the time Thursday rolled around, I had generated enough in sales to not only send a check to the IRS for what I owed, but I also sent them a check, at the same time, for the revenue that was generated to pay the taxes I just made. So, I was literally at zero, and zero felt so amazingly good. If you’ve ever been in debt in a big, big way, and unfortunately, I have, right? I’ve been really irresponsible and didn’t manage cash flow well at all. Boy, broke can feel real good.

John: So, Ryan, let’s maybe, for Fire Nation, just sum this up in one or two sentences as the biggest lesson learned that you want our listeners to walk away with from that moment in your life.

Ryan Deiss: It sounds simple. Pay your taxes. Manage your cash flow, right? Know every single day from that day; I get a report from my bookkeeper of here’s how much cash you have in the bank. Yes, look at PNLs. Look at all those things. But if you’re not managing your cash, and that’s not something that you’re looking at every day while you’re growing.

Cash is the fuel that will grow your business, right? So, entrepreneur on fire, you need some fuel. You need to be ignited. That’s gonna require some freaking cash. You can have all the energy in the world. You can have the best idea in the world. If you don’t have any cash to fuel your idea, you’re gonna fizzle out. So, watch your cash like a hawk.

John: You are so on-brand with this interview. I love it, brother. You’ve had a lot of good ideas, Ryan, over the years. In fact, maybe you’ve even had too many. You know you could have too many good ideas, but what I wanna know is one of those great aha moments that had. Maybe it was in the shower. Maybe it was driving to work. Maybe it was on a run in the bay there in San Diego. What is one of those great aha moments that you had? And tell us that story, but then walk us through how you turned that idea into the success that it is.

Ryan Deiss: I started my very first business from my college dorm room in 1999, right? And the whole reason I did it was just to make some extra money because I wanted to buy an engagement ring. I had met my wife. I hadn’t told her yet that we were gonna get married because that would have been freaking weird because we’d only been dating for a few months. But I kind knew, right? I kinda knew this is the one, and I’m broke. So, I should probably figure out a way to make some extra money because I was a full-time student, and I had a full-time job. And that just allowed me to eat. There was no extra left over.

So, it’s the first kind of dotcom boom. I’m gonna start an internet stuff. And so, I started stupid little websites on stupid little pieces of software and eBooks and things like that, and none of it having anything to do with marketing, right? I mean it was literally stuff on how to make your own baby food, all these little niche subjects. Well, back then, you think about the early 2000s, nobody was doing this stuff, but that was when you first started having marketing conferences.

So, I went to these conferences as an attendee, and I’m like the kid. So, everybody’s asking me questions because they want to know, literally, who’s this child who’s here. I wasn’t even old enough to drink. I couldn’t rent a car when I went to these places. I’d have to go and get a taxi because it was before Uber. So, I went, and before too long, they asked me to speak.

And I remember the very first time I had a speaking engagement when I was done people said, “Okay, do you have a book?”

I was like, “No, I don’t have time to do a book. I’m busy running these businesses.”

“Well, can you do consulting?”

Like, “No, I don’t really have time to do consulting. I’m a student, and I have these businesses.”

“Well, what do you have? What can we buy?”

And I remember thinking, and I told everybody, “Look, I’m starting a brand-new project where I’m going to be launching this new property over here. If you guys want to give me like $500.00, I’ll send out some emails and things.” I didn’t know how to record video. It was before ScreenFlow and all that stuff. I was like, “I’ll just send out some emails with some pictures showing you guys what I’m doing as I build this thing out for the next 60 days.”

And I remember just this flood of people giving me all this money, and I was like, “Okay, there’s something here.” And what was great is I didn’t just use that money and put it all in my pocket. I used that money to fund my businesses. But that kind of first idea of like why don’t I just be an open book? Why don’t I opensource my test results and opensource my processes and just kinda let people see behind the curtain?

At the time nobody was doing that. Everybody was holding everything very, very close to the vest. And when I said, “No, look, you can come and see it, warts and all.” And out of that general idea, that’s what DigitalMarketer is today. DigitalMarketer existed long before the DigitalMarketer brand existed, long before we did Traffic and Conversion Summit, long before really, I even had my own formal email list.

I was just sharing and talking about what I was doing, so that first kind of idea of let me go out there and opensource my ideas. Let’s sell off our raw materials, and see if anybody wants to buy it. Again, going back to cash and fuel, that was the thing that fueled a lot of my entrepreneurial endeavors and allowed me to do that without going and seeking outside capital.

John: Fire Nation, I hope you’re recognizing that the foundation, the core, of what’s made DigitalMarketer, of what’s made Ryan Deiss who he is and the business that he has today, it hasn’t changed. It hasn’t changed from that day one. So, build that foundation, build that core, the right way and grow from that point forward. And Fire Nation, if you think Ryan’s been dropping value bombs thus far, you’re right, he has, and we got more coming up in the lightning round after we get back from thanking our sponsors.

Ryan, are you ready to rock the lightning rounds?

Ryan Deiss: Let’s do it.

John: What was holding you back from becoming an entrepreneur?

Ryan Deiss: This is going to sound arrogant, but nothing. My favorite superhero, growing up as a kid, was Bruce Wayne, right? Not Batman, Bruce Wayne. I love that his superpower was that he was rich, and I don’t know. My parents asked me like, “What do you want to be when you grow up?” and I was like, “A millionaire,” because I was like, “Bruce Wayne’s a millionaire, and he seems really, really cool and kinda gets to do whatever he wants.”

And my parents came from a lower middle-class family, and they both were like, “That’s great. You can do whatever you want.” My mom was a hustler. I saw her starting businesses. And so, as far as I was concerned, that’s kind of just what you did, and nobody ever questioned it. I was very, very luck in that regard. I feel I’m so impressed by people who have that resistance, and they have people in their life that don’t encourage their dreams, and they power through. But I would be doing them a disservice if I pretended like that was mine. I was very, very blessed in that regard.

John: What’s your superpower? Being rich. Love it. What’s the best advice you’ve ever received?

Ryan Deiss: I remember the only job that I ever had was as a financial consultant, and I was having this conversation with my branch manager about I’m gonna do this, I’m gonna do this, I’m gonna do this. He was like, “Let me stop you right there, son. Stop talking. Go sell some stuff,” and his words still ring in my head. And I say that to my team all the time, “Stop talking. Stop screwing around. Stop planning. Just go sell something. Just go sell some stuff and figure it out.”

John: What’s a personal habit that contributes to your success?

Ryan Deiss: With four kids, I can’t do extensive time blocking. With four kids and forty-something companies, I can’t plan out every hour of every day, every minute. But what I can do is say this is the one thing that if I only get this one thing done tomorrow, it’ll be a good day, and this is the one hour that I’m gonna block out. So, literally, on any given day, I block out one hour, and I let life happen kind of the rest of the time.

But what’s amazing is if I get that one hour in, one hour turns into two turns into three, but if I try to plan more than that, something happens. Life happens. Business happens. Kids get sick. I don’t get into it, and I feel like a failure, and I tend to fall off. So, that one thing, one hour, is the habit I’ve been able to keep that’s made me more productive than anything else.

John: Well, a quick side note, thank you for blocking off these 30 minutes. I’m grateful, and I know Fire Nation is too. And if you, Ryan, could recommend one internet resource, what would it be?

Ryan Deiss: I love the Pocket app because I come across stuff all the time that’s like good that I don’t have time to read. So, I can go and drop it in. You know, a good blog post or something like that, drop it in Pocket. And that’s kind of limbo for me, and then I’ll go and consume it. So, one day a week, usually over the weekend, I’ll go through all the stuff that I added into Pocket, and then it either gets categorized in Evernote for storage, or it gets implemented. Or it’s just cool – I read it. Check. And it’s gone. So, having that limbo state for all this information that’s hitting us using the Pocket app has been big.

John: And by the way, Fire Nation, get on DigitalMarketer’s newsletter, and you’ll be pocketing every one of those, just pure gold. Recommend one book, Ryan, and share why.

Ryan Deiss: One book, okay. That’s like which one of your kids is your favorite?

John: Sarah, of course!

Ryan Deiss: Yeah, exactly. Wizards of Ads is a book written by my friend Roy Williams, my mentor in business and marketing. Roy’s a radio ad man. I think radio, it’s the closest to what web writing is today because if you think about how we’re consuming Facebook. It’s very quick. It’s very passive. There’s other stuff flying by. It kind of resembles driving down the road listening to the radio. So, if you can learn to write good radio spots, you can write for the web.

Hacking Growth, the new book by Sean Ellis, I thought was really great. Ready, Fire, Aim. And bonus, going back to the cash management stuff, Richest Man in Babylon. Set aside 10 percent, holy crap. So, you said one. There’s four.

John: Let’s end today on fire, Ryan, by you giving us a parting piece of guidance, the best way that we could connect with you, or just whatever you have going on in this world that you want Fire Nation to take action on, and then we’ll say goodbye.

Ryan Deiss: Yeah, just head over to DigitalMarketer.com. If you go midway down the page, we list all of our most popular blogposts, and there’s one called Customer Value Optimization. It sounds a little bit boring, but it totally revolutionized the way that we do business. So, what I talked about figuring out how you’re gonna go about acquiring customers profitably and predictably, that’s really the post that I point people to. So, if you want more info on that, go check that out. Like I said, DigitalMarketer.com, scroll down, click the link, you’ll find it.

John: And a parting piece of guidance?

Ryan Deiss: And kind of the big thing that I would leave everyone with is get good at describing the value that you bring, concisely, right? Put out there what’s their before state, what’s their after state, and begin describing. It’s really, really simple. So, right now you’re probably feeling this. By the time you’ve gone through our product or utilized our services, you’ll be in after. If you can learn to articulate that shift from the before state to the after state, you can become an amazing copywriter and an amazing marketer.

John: Fire Nation, you’re the average of the five people you spend the most time with. You’ve been hanging out with R.D. and J.L.D. today. So, keep up the heat, and head over to eofire.com, just type “Ryan” in the search bar, and his show notes his page is going to pop up with everything that we’ve been talking about today. These are the best show notes in the biz: time stamps, links galore. And of course, head directly over to DigitalMarketer.com, scroll down to the post about Customer Value Optimization. Killer! And Ryan, thank you for sharing your journey with Fire Nation today. For that, we salute you, and we’ll catch you on the flip side.

Ryan Deiss: Thanks, buddy. Big fan. Pleasure to be on it.