Why Saying Your Business Isn't Scalable Is the Wrong Diagnosis | Ep 987

I wanna talk about a business myth that needs to die. It's something that so many business owners believe. How it's applied to thousands of businesses that have come to our headquarters here at acquisition.com in Vegas, and how it's likely Holding you back. And it's one of the most insidious beliefs, and I think it might be the one that ends the most businesses. And the crazy part is it has nothing to do with the business and everything to do about how you treat it. Now I've had the same problem come up again and again and again that I felt the need to make this for you. Which is my business isn't scalable, or shouldn't I switch my business some to something that's more scalable? Again, I might Gouge my own eyes out. But I the reason that I that I'm so annoyed by it is that basically every business has limits to scalability and there are different problems that occur at different times.

Now I want to talk about this within two different contexts. One is industry context, and secondary is um more on like the demand and supply side. But I'm gonna I'm gonna break this down a lot of different ways. So right off the bat, if you have a service business, for example, you hire humans to do hu things for other humans. Then That is a business that's very easy to start, can be very profitable, and then over time can become a little bit more difficult. Not impossible, just more difficult. to scale quickly because maintaining quality of service when you have other humans doing things and you're bringing them in and they don't know anything and you have to train them. becomes more challenging. If we had kind of like the middle of the path there, you've got like an e commerce business, which you can start relatively quickly, but as you scale up, you can scale up quickly, but some of the issues become supply chain and logistical problems, right? So I'd say that's kind of like in the middle, right? It's it's a little bit slower to start, it costs a little bit more money to start. It does scale faster

Than traditional service does, but you're still gonna run into some problems. Now, all the way on the kind of extreme side, you've got the the software digital type businesses. Now, these businesses um are typically when I say digital, I mean SaaS software, not digital products like ebooks and courses, things like that. These businesses cost the most amount of time to start, the most amount of money to start, but once you achieve scale. They become significantly easier relative to the others. And so I get this question of like, I don't think my business is that scalable all the time, when in reality it's just harder to scale. And so the thing is is that switching from one service business to another service business in terms of overall category is not likely to dramatically change your growth trajectory at all. You're still likely going to be constrained by humans, which most businesses are. I'm gonna say this again. Seventy eight percent of businesses in the United States are service based businesses. Like this is This is reality. And the reason that this is so annoying to me is that people will come and want to break their businesses. They won't want to abandon their businesses because they think that the woman in the red dress, they think this other new thing somehow doesn't have the same characteristics of a people based business. Now, within that category, let's say we have a service business, you can have demand constrained service businesses and supply constrained service businesses. Each business has problems. And the crazy part is that

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