Today I’m fortunate enough to have an incredible guest. Let’s start off with some hints to see if you can figure out who it is! He’s the mega-bestselling author of 28 E-Myth books, including The E-Myth, The E-Myth Revisited, and his newest book Beyond the E-Myth. Inc. Magazine has declared him the “World’s #1 Small Business Guru,” and his books and methods are taught at well over a hundred universities worldwide.

Have you figured it out yet? The answer, of course, is the renowned Michael E. Gerber. In this conversation, he gives incredible insight into creating and running a company, all gleaned from decades of experience. We learn in particular about OldCo versus NewCo, and the four distinct personalities of the “entrepreneur within.”

Find Out More About Michael Here:

@MichaelEGerber on TwitterMichaelEGerberCo on FacebookMichael E. Gerber CompaniesEMyth.com

In This Episode:

• [01:52] - The E-Myth is the entrepreneurial myth, Michael explains. He goes into more depth, describing the difference between entrepreneurs and “technicians suffering from an entrepreneurial seizure.” He and Stephan then discuss the concept of a “company of one.”
• [04:10] - Michael talks about companies not surviving the first ten years, and offers his definition of survival. He also talks about the importance of having an exit strategy.
• [09:10] - Why build a new company instead of fixing the current one? Michael’s response is that Stephan’s hypothetical scenario isn’t one that’s of interest to him. He and Stephan then talk about a more realistic scenario: a businessman with a few employees.
• [13:39] - The “entrepreneur within” is four distinct personalities, Michael says. He explains what they are: the dreamer, the thinker, the storyteller, and the leader. These correspond to the dream, the vision, the purpose, and the mission. He also describes his Dreaming Room, and gives examples of companies that he’s helped achieve success (including Infusionsoft and 1-800-Got-Junk).
• [20:15] - Michael explains why his new book Beyond the E-Myth is “beyond” the E-Myth. People see growth, opportunities, and problems as complex, he explains, and this book makes them simple by giving a list of steps.
• [21:23] - Michael’s first four steps correspond to the personalities and roles of the four aspects of the entrepreneur within. Together, they form the foundation or platform on which you can grow a company strong enough to sell.
• [22:15] - Many businesses are confused by the differences between these categories. Michael gives examples of his answers to help clarify the categories for listeners. He and Stephan then talk about the example of McDonald’s to illustrate the difference between creating a business versus creating a job for yourself.
• [26:28] - Michael talks about who his consumer is: the independent small business owner.
• [27:41] - “You’re not trying to fix what’s broken, you’re trying to create what’s not,” Michael memorably tells us. He goes on to explain more about the importance of creating a new business instead of fixing a broken one, or choosing “NewCo” over “OldCo.”
• [29:32] - Stephan talks about Carl Jung’s separate office for his dreaming work, and mentions his previous interview with Cal Newport. He and Michael discuss the importance of having a separate space for your deep work, or big-picture thinking.
• [30:29] - We’ve now reached the mission, which is to “invent the turnkey system that will enable you to realize and manifest your dream, your vision, and your purpose.”
• [32:52] - In discussing the importance of NewCo over OldCo, Michael talks about Lockheed Martin’s Skunk Works, which he holds up as an example of NewCo.
• [35:02] - Michael explains the difference between a mission statement and a vision statement.
• [37:26] - Some people are too rigid to easily accept that they aren’t irreplaceable. This makes it harder for them to go through these steps, Michael tells us. He also talks about what makes a turnkey system or business “turnkey.”
• [41:52] - Michael gives his definition of a legacy. It isn’t about money, he explains, but rather the creations you’ve left behind.

Get Optimized!

Take an honest look at your company. Is it a “company of one”? That is, if you were to quit today, would the company be able to survive?

Develop an exit strategy for your company. Could you sell it in one year? Five? What would that take? Outline your options and sketch out plans to make this possible.

Using your work from the previous step as guidance, do one extra thing each week to make your company more saleable.

Links and Resources:

@MichaelEGerber on TwitterMichaelEGerberCo on FacebookMichael E. Gerber CompaniesEMyth.comThe E-MythThe E-Myth RevisitedBeyond the E-MythDreaming RoomCal NewportLockheed MartinSkunk Works