If I had to start a business from scratch today, I would not repeat my first few years. I spent months building funnels, PDFs and full programs, and I made almost no cash.
That was a treadmill business. Constant effort, going nowhere.
When I switched to coaching, I picked one problem, packaged it simply, sold it directly and got cash on day one. That was a vehicle. Here is how I would build one again.
The one rule: do not run out of cash
Two numbers decide whether your business lives or dies. Your customer acquisition cost, and how much a customer pays you in the first 30 days.
If the second number is not bigger than the first, the business fails. Everything else comes after that.
My treadmill vs my vehicle
My first fitness business sold a $47 program. PDFs, files, a few walkthrough videos and no coaching.
It cost me $300 to $500 to get a customer. Ads lost money. DMing people by hand took about 12 hours of work per $47 sale. That is roughly $9 an hour, worse than working at Olive Garden.
My first coaching offer had the same acquisition cost, $300 to $500. But the offer was $3,200 for four months. I collected roughly 35% up front, about $1,100. Revenue was two to three times my acquisition cost right away.
Later I was spending $300 a day on ads, getting about 30 leads and 3 calls, and closing at least one. Often I closed 40% to 50% of calls. That is $300 in ads turning into $3,200 in sales.
CAC by business model
- Dropshipping: CAC of $50 to $150 against an average order of $20 to $50. Upside down immediately.
- Low ticket memberships and courses: CAC of $100 to $300 against $27 to $97 a month. Payback takes three to six months or more, if they do not cancel.
- Coaching and consulting: CAC of $200 to $500, roughly 25% of the price or less. On a $1,000 to $3,000 offer, you get a 3x to 10x return inside 30 days.
- Agencies and services: similar acquisition cost to coaching, but media buyers, VAs and staff eat your margin.
I prefer coaching and consulting. High prices, delivery you can leverage with courses, and a few simple calls that add real value.
Five ways to raise lifetime value
- Raise prices. I went from $1,500 to $2,000 to $2,500 to $3,200, one step at a time.
- Upsells. Offer more of the same, like ads, copy or done for you work, to clients who already got results.
- Cross sells. Offer a related but different service, like video editing or YouTube growth.
- Continuity. After a big up front program, offer a smaller monthly plan to stay on. For example, $16,000 for four months, then $2,000 a month to continue. If they leave and come back, they pay the full rate again.
- Retention. Deliver real value through community, calls, accountability and some done for you help. Some of my top clients have paid me three or four times at $50,000 or more.
How to handle the price objection
Say your offer is $10,000 and the prospect says it is too much. Walk through this:
- Ask if anything besides price would stop them. They say it is just the price.
- Ask: if the price were solved, would you sign up? They say yes.
- Ask what they have available across checking, savings and credit cards. Know your floor before the call. In my example, the floor is $2,000.
If they are under the floor, wrap up politely and suggest they look for funding. If they are at or above it, offer a custom deal, but only after they commit to paying today. Never discount before a commitment.
Something like $1,000 down today and two payments of $500. Frame it as a fair trade: they get a better deal for deciding quickly.
My five step plan to rebuild
- Pick a problem that pays. Stay one step ahead of the market in health, wealth or relationships. No skill yet? Learn one on Udemy for under $100 or for free on Alison.
- Package it simply. Start with a $500 to $2,000 offer. Deliver it ugly but effective with Loom videos, Zoom calls, spreadsheets, PDFs or texts. Polish later.
- Front load cash. Collect at least 25% up front, ideally 50%, and push for paid in full. Use payment plans only when you need to. Up front cash funds ads and hiring.
- Do outreach, do not wait on content. Send about 100 DMs a day, 20 an hour. Expect about 15% replies on cold, 15% to 30% on warm followers. Book 10% of conversations and close about 10% of calls.
- Reinvest into ads. Use the law of 10: 10% of spend becomes leads, 10% of leads become calls, 10% of calls close.
The 30 day cash ratio
Track 30 day cash collected against acquisition cost. Above 3x, you can scale. Aim for at least 4x.
Spend $1,000 and collect at least $2,000 in cash, ideally around $4,000 in total sales with half collected up front. At 3x, $5,000 in spend should bring at least $15,000 in sales.
The excuses, answered
- “I don’t have an audience.” Start with one client through DM outreach.
- “I have no skills.” You only need to be one step ahead of your buyer. I started consulting trainers while I was still learning.
- “I’m shy on camera.” Use a screen share or voiceover.
- “What if no one buys?” Then you need more reps and better messaging. Practice is the only fix.
The takeaway
AI, short form content and automation make it cheaper and faster than ever to start lean. But only if you choose the vehicle over the treadmill. Pick a high margin, cash positive offer, front load your cash, and make every dollar come back inside 30 days.
Want to know what’s capping your business right now? Take my free 90 Day Ceiling Plan. Answer 18 questions and get a written plan, built on your own numbers, that names the one thing holding you back and what to fix first.
