Featured Coaching Training: How to Turn My Dream into Reality: Initial Steps
Many people maintain dreams their entire lives without ever reaching them. To make your dreams come true, we have to transform our dreams into goals. Learn the steps to turn your dreams into reality in this series.
Featured Coaching Excerpt - Notes & Transcript, Part 1
Step #1 : Create a pro forma
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Lesson Nugget: Two monitors are necessary. One to take notes, and one to watch.
Definition Magician: A Latin term meaning "for the sake of form". In the investing world, it describes a method of calculating financial results in order to emphasize either current or projected figures. (www.investopedia.com)
Creating the Pro Forma: Create a list of everything you will need:
A. Quotes / Costs
Creating The Pro Forma: B. Team Members & Their Cost
Lesson Nugget: Don't outsource your core competency.
Core competencies are the combination of pooled knowledge and technical capacities that allow a business to be competitive in the marketplace. (www.investopedia.com)
Creating the Pro Forma: C. Cost of Physical Office Space
Creating the Pro Forma: D. Costs of a Dream 100 Investor List
Lesson Nuggets: Fixed expense - rent, utilities, administrative costs and insurance costs.
Variable expense - inventory, shipping and packaging costs, sales commissions, and other costs associated with the direct sale of a product or service. (https://www.sba.gov)
Lesson Nugget: Be sure that you have all of your costs clearly defined.
Editor's Note: All Thrive15 workshops are included in your monthly membership!
(upbeat music) Action item number 1. Create a proforma list of everything you will need in order to make this happen. Okay, first off Thrivers, we're have a downloadable proforma you can download. So you'll be able to download this, Alan. Everybody watching can download this. I would recommend you have two monitors. Not just because Carnegie Mellon said you should. Not just because a lot of institutions of higher learning say you should. Not just because most tech companies have two monitors for people. Not just because I think so, but because you need to have two monitors. It will change your life. Get two monitors, one to take notes, one to watch, okay. On monitor number 1 you need to have your proforma going on or let's just say on monitor number 1 watch Thrive15 and on monitor number 2 you'll have your proforma, okay. I need you to make sure you get this. Proforma, we'll put the definition of a proforma. But a proforma is a projection for how your company will perform. It's a projection of how your companys going to perform under certain circumstances. So what you need to do, is you're going to define all of these items, these line items specifically. So one, you want to figure out what are all of the costs associated with building this app. Call an app company, ask them how much do you cost? Get a quote. Don't get one quote, get three quotes. Find the average of the quotes. But find out what's it going to cost. Figure out what's it going to cost if you employee team members if you make it in-house. And you should make it in-house. Do not hire a third-party vendor. But, you want to make it in-house. You never want to outsource your core competency as Bill Shofty taught me. You know if everyone outsourced your core competency which I've done before and I've paid a dumb tax for it. You want to make sure you get your costs. You want to make sure you figure out what it's going to cost to bring in those team members. Then you want to figure out the costs for your physical office space. And you want to figure out the costs to actually execute a Dream 100 marketing strategy. Maybe go to other trainings on how to do that. You want to just to keep it simple. You want to outline every single one of your variable costs. It's a cost that's associated with every transaction. So everytime you sell something, what is that cost? I would argue for your app, you'll have very few variable costs and they'll almost all be fixed costs. There's a cost to make the app, to hire the guy, to get the office space. There'll be maintenance costs for their salary but it wouldn't necessarily cost you $.22 everytime someone downloads the app. You know what I mean? You've got to figure out all those costs. You have to define your fixed costs and your variable costs. And once you have done it. Once you feel like you've developed all of them. Go to bed. Wake up and go what other costs? And after you've done that, go to bed, wake up. This is what I'm talking about, a magnificent obsession. Because you would not believe all the costs. Think of all the taxes, think of all the fees, the licenses, the server, the computer, the decor, the office, the lease, the insurance, the rent. Paying half of your money to the government. Factor all of that stuff in because you have to figure out all of your costs. And it doesn't cost you anything, except for time to define your costs. But almost no entrepreneurs ever do this. I'm talking about, and Augustine, I'm talking to you there too. You want to go through every single cost. I mean we have another Thriver here named Augustine, who's in town visiting. But you want to make sure you get every single cost defined. And when you're sure, when you know you have all your costs, Then bring in somebody else and say what are other costs? Then when you're sure, do it again. I used to play this game with Bill Shofty. I'd meet Bill Shofty every Thursday at the office and I'd be like I have them all. And he's like, "You don't have them all." I'm like how is going to cost $2 million to build this? And he's just going, "You don't have all your costs still. What about this?" And I'm like how do you know that? And he's like, "I've got grey hair. I've done this for a long time. I wasn't born yesterday." No matter how motivated you are, it's going to cost something. A lot of people they just, we're so motivated, you know, we're so obsessed with the idea, we got that part right. That we don't put in the time needed to determine all the costs. So, you have to determine all of the costs, get an accurate proforma. And Thrivers you can come out to our workshops. Those are included in your membership. You can come out and we'll teach you how to make a proforma. But, back to you. There you go Thrivers. That's how we're making our dreams into reality, creating that proforma.