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Most of the time, success leads to more success, especially if you know how to leverage it. Doug C. Brown invites someone whose success story turned to even more success. He sits down with none other than Mitch Russo. As a business founder, he started, found, and grew a solid company and sold it for eight-figures. He also partnered with Tony Robbins and Chet Holmes to build a profitable $25 million company. In this episode, Mitch shares his successful career journey with us and the overnight success that took him years to have. Author of the book, Power Tribes, he then lets us in on what building a tribe is, why it is important, and how you can successfully do that. Follow along to this great conversation as Mitch takes you on a rollercoaster journey that is inevitable in this business world and how, through grit and courage, you can overcome the challenges your way.

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Courage And Grit: Leveraging Business Success For More Success With Mitch Russo

I have the privilege to welcome to the show, Mr. Mitch Russo. As a business founder, he started, found and grew a solid company, and he sold that company for eight-figures. He also partnered with Tony Robbins and Chet Holmes to build a profitable $25 million company. He has authored two books, one called Power Tribes and The Invisible Organization. Mitch is a unique guy. He’s got a colorful background, and you’re going to appreciate some of the stories he shares. He’s pragmatic and logical. He went on to build a lot of different divisions for a lot of different companies. He has his own business, coaching, consulting, and helping companies build out tribes and invisible organizations get to the next level. Without further ado, I’d like to welcome Mitch to the show. Pull up your chair and you’re going to learn some amazing stuff on how to get your business to the next level.

Mitch, I want to welcome you to the show.

Doug, thanks so much. I’m glad to be here. It’s great to see you again and I’m excited about being with you.

I’m excited as well. For our readers, if you don’t know the backstory here, Mitch was my boss at one time. He was the CEO and high creator of revenue within a company called Business Breakthroughs International, which was with Tony Robbins and Chet Holmes. I was the President of Training and Sales for that particular company. I worked hand-in-hand with Mitch. I’m excited for all of you to be able to read this because Mitch has this incredible journey through his life, which I hope we can talk a little bit about. Also, where he is in his life with different things that he’s doing, whether it’s Power TribesThe Invisible Organization or Profit Stacking Secrets. Mitch, a lot of people talk about, “This guy is successful. It must have been easy to get there.” How long did it take you to be an overnight success? I would love for you to tell your backstory. How did this all get started for you?

I am an overnight success if you can add many years to the beginning of my story. This all started for me in high school. The reason I say that is because I was a shy kid. The one thing I wanted more than anything was to have a girlfriend but I was too shy to approach girls. What I decided to do because I am a strategist even as a kid, I said, “How do you get girls?” If I had a rock band, I would be able to invite girls, and that’s how I will meet them. I spent years learning to play the guitar so I can have a rock band in high school, which I did. It turned out to be an incredible strategy because we had girls coming over every Saturday for band practice.

The interesting part of this story to me is that I learned at the age of sixteen all about business, promotion, marketing, price testing, competition, discipline and quality. All these things became so important to being able to create a music experience of quality. We used to get stoned, play the guitar, and it was fun. We turn on the recorder and play it back and go, “That sounds terrible.” The first rule was no getting high. If you want to play in this band, we will have band practice, but you can’t get high. I know this maybe will offend some people, but the bottom line is that I’m a kid of the ‘60s and everybody in high school smoked pot. I did too, but not to the extent that some of my friends did. What we did is we took each song one at a time and we practiced it over and over, sometimes for weeks, until we got it perfect. I wouldn’t want to use the word perfect because in business, the price of perfection is bankruptcy, but we got it close. At that point, we went onto the next song. By the time we had fourteen songs ready to go, we were booking gigs. That’s the start and that’s how I learned. That’s where I began my education in business.

What I got out of that one, firstly, there’s this passion or desire. All of you reading here, pay attention to the attraction factor of incoming leads, which in this case, was how do we get girls to pay attention. Through that experience of having a desire and wanting to go forward with that particular desire, it turned into a business and a business lesson, or a life lesson that you took from an early age and carried all the way through.

What ended up happening is as I got older, I found myself immersed in electronics. Electronics was always my hobby. I entered every science fair I had the opportunity to enter. I won a few of them. I was sent home several times because the teacher thought my father built my project when it wasn’t my father. I was an involved kid when it came to electronics. I knew I’d pursue that growing up and I did. At first, I went to school for color television repair. I imagine that I had no idea what I was going to do with my life. I tried college and I didn’t like it, so I dropped out. My mom said, “You’ve got to do something. What do you want to do?” I said, “Fred comes to the house and fixes the TV. I like what he does. Maybe I should do what Fred does.” She goes, “If that’s what you want. I’ll find you a color television repair school and we can get you enrolled.” She did. I enrolled and I went on this journey of learning to fix color television sets.

At the final term of school, we had to take this mandatory class, which I thought was completely useless called Digital Electronics. Everyone knows TVs don’t have digital electronics, it’s tubes. This one professor was smart. He saw the future and said, “There’s going to be a lot of digital electronics and TVs someday, so you’ve got to learn it.” This guy then started to call me up after class every day. He’d give me these individual assignments. He gave me this book. He said, “Study chapters 2 and 3, and do the exercise at the end.” I did and at the end, I turned it in and he gave me another exercise. He didn’t do this for anybody else, but I was having fun, so I didn’t complain. At the end of the term, he said to me, “Do you realize what you did?” I said, “I have no idea what you’re talking about.” He said, “You completed years 1 and 2 of Digital Electronic Circuit Design Theory.” I said, “What?” He goes, “You now have the same expertise as many college graduates when it comes to logic design.” I realized that all of a sudden, I had this ability and I started designing circuits. I realized my passion was not in fixing color TVs, it was in circuit design. That’s where I headed next.

In business, the price of perfection is bankruptcy. Click To Tweet

I ended up getting a job for a semiconductor company called Mostek. Mostek was out of business because they were originally purchased by United Technologies. I became a field application engineer for Mostek. I get into the field of application engineering. I became one of the best in the country at microprocessor design, and debugging Z80 microprocessor coding and problem-solving. I was flown all over the country into large corporations and big labs with a bunch of adults. I’m helping them fix their problems that they spent months trying to solve, that I could fix in five minutes.

That was fun, but I noticed that the sales guys were the ones making the big bucks and they were morons. I said, “I could do that.” I went to the top sales guy in the company and I said, “I want to join the salesforce.” He looked at me and has that evil smile on his face. He says to me, “Mitch, great salespeople are born and you’re not one of them.” I had three words go through my mind, “I’ll show you.” At that point, I quit the job and I went to work for his competitor. I became the third top salesman in the state for semiconductor sales. I was selling $20 million-plus a year in semiconductor sales. That’s where I built up my cash reserves to go to the next step.

All of you Millennials out there, Gen X, Gen Y or whatever Gen you are, pay attention because there were things called vacuum tubes in televisions awhile back. I know you and your backstory was connecting the dots to where you became this highly successful person. I’ve known you all through the years for these two things, which is courage and grit. Even at Business Breakthroughs International, we had some challenging times that we had to work through as well. Courage and grit, and a propensity to want to make sales. Did that lead you on for the semiconductor? I know you went on to build a company called Timeslips, and then you sold that off to Sage. You built the backend for Sage or you had 300 people working with you. Knowing you, it’s more of logic design is your forte because that’s what I witnessed throughout our lives together.

That’s a great observation and insightful of you, Doug. That’s what I got out of going to engineering school. In a short period of time that I did, I learned how to think like an engineer. Through my work with my teacher at television repair school, I learned logic design and therefore, my mind seemed to love it. You know your mind loves something when it becomes a natural way of thinking. That to me became a natural way of thinking. Problem-solving, finding solutions, and finding a better way to do almost everything became my mantra. Without even knowing the words, that’s how I acted all the time. Once I decided that it was time for me to move on from being a salesman, it came to me as a silent decision inside of myself.

I said, “I don’t want to sell. I don’t want to be a salesman. I don’t want to ride the ups and downs of the industry anymore. I want to start my own company.” I said to myself, “I’m going to allow the universe to bring me whatever it sees as the proper thing for me to pay attention to.” Within a month, I had five opportunities to start my own company. Some of them are funny. The one that was the most interesting was where a neighbor moved in next door to me. There were only four homes on this whole street and two of them were empty. I bought one. My new neighbor came along and I went over to say hi. I brought him a coffee cake. We ended up becoming friends, going to breakfast and lunch together. Talking one day, I shared with him this idea I had for time-tracking.

I had this idea because I found out from my accountant that I have to keep track of the time I spent on my computer if I wanted to deduct it as a business expense. The IRS thought computers were toys. If you’re using them for business, you have to approve it and you needed a log. I thought to myself, “There’s got to be a software out there that does this.” I looked in and there wasn’t. I said to Neil, my partner, “I’d like to come up with something that does this. Maybe I could build this with a database program like dBASE II or something like that.” He shook his head and we drew out a few sketches. Six weeks later, he said, “Mitch, come on over. I want to show you something.”

I take the long trip down my driveway, up to his little office. He opens up his Apple II and shows me on-screen exactly what he had drawn on the napkin, and what was a prototype of the Timeslip software that we would soon build a company around. There was only one wrinkle. He had done it on an Apple II. We needed it on a PC because the world was embracing PCs. That was the era where PCs were coming into their own. I said to him, “I know you can program it on an Apple II. What are you going to do about a PC?” He goes, “It’s just code. I’m sure I could do it.” We both put $5,000 each into a bank account and from there we bought him a new IBM PC with a huge 10 MB drive.

Business Success: What success leads to is more success.

I waited and sweating for weeks for him to figure it out. He finally calls me, “Come on over. I want to show you something.” I go over again and there he is in front of the PC and he says, “Watch this.” He takes his finger and he pressed a key on the keyboard and the letter shows up on the screen. I said to him, “Yeah?” He goes, “I programmed that.” I had this thought, “This is going to be a long road,” but I also knew he was brilliant. Within a matter of months, we had a working prototype of our version 0.1. That was the beginning of Tax Kick, which was going to be the software that kept track of time for taxes.

Six months later, we finished Tax Kick. It was running. We had the documentation. I said, “Neil, I think we need to quit our jobs and do this.” He goes, “I’m game.” We quit our jobs on Friday. Monday, I get a phone call from my accountant who says, “Mitch, I got bad news for you.” I said, “What’s the bad news?” He goes, “The IRS has relaxed their ruling on contemporaneous recordkeeping. I’m sorry but that software you wrote is much useless to this point.” What do people who spent six months of their life, pouring their life into something like this do? The answer is not to give up. The answer is scream, holler, yell, complain, bitch cry, throw things around the room, and then pivot. That’s what we did.

We brainstormed and figured out who else would need active time tracking, and the idea came to us, “Lawyers need active time tracking. Why don’t we build a legal time billing tracking system?” I said to Neil, “Have you ever built the billing system before?” He goes, “Yeah, piece of cake. I built one for hairdressers some time ago.” I said, “Hairdresser is not quite lawyers, but let’s go with that.” I went to the library of Boston University. I started taking out the user manuals on all these heavy-duty time and billing systems for lawyers that were written in COBOL and Fortran. We took the manuals and we copied the billing formats and realized what features we needed by reading those manuals. We built them into this new modern pop-up DOS-based platform. Three months later, we released Timeslips version 1.0.

That’s awesome. Pay attention, courage and grit because you got hit with something hard and all of a sudden, it’s like, “I’ll show you.” Those were the same words you used before. For those of you who are quite young reading this, 10 MB was a huge deal back then. There was the Moonshot that was only 2 MB, so 10 MB was huge. Let’s talk about Timeslips because many people give up as we know. Part of selling and getting successful in growing a company is you’ve got to get that courage and grit into the sales process. Do you remember the first time you got to your first million dollars in sales? Can you share anything back from the memories? s

We started the company. We went 90 days without pay while we were building this new version. We finally released it. When we released it, we had a total of $10,000 in marketing budget. We had been visited by the PC Magazine rep who convinced me to spend $6,000 of that $10,000 on two ads and PC Magazine. He said, “You’ll make double or triple your money back on those ads.” I said, “Let’s go for it,” and we did. We made six sales for $99 each after both ads run. I was devastated. I’m thinking to myself, “There’s my first act as CEO. I made a big blunder.” About three weeks later, he visited my house and handed me this fat envelope filled with something called Bingo Leads.

A Bingo Lead is the tear-out cards inside of magazines where there’s a bunch of numbers. What you do is you’d go through the magazine and you circle the numbers of all the products you like, and then you send in this one card through the mail. All of a sudden, those vendors would send you their promotional materials. He hands me a sample of 500 bingo leads in this envelope. I thought to myself, “I got to tell you, I have no other resources.” I sat down and started calling every one of them. That became the most valuable thing that could have happened. In retrospect, I am a believer that everything always happens exactly for the right reason and sometimes exactly at the right time. In this case, it was for both because I sat down and I called every one of those leads.

Two things happened. I sold another 30 copies, which is not a lot of money. I made half of our advertising revenue back, but more importantly, I got market research on exactly who is interested in looking and needs our product. From that exercise, we switched all of our efforts into marketing to lawyers. Initially, PC Magazine marketed to everybody, but then when we started marketing to lawyers, we didn’t have any money left. We were running $30, $50 classified ads, and every single ad had an extension code. We were able to tally up on a paper pad every order that came in and where it came from. We were able to then re-invest in those listings that made us money. We got to the point where we are making 7, 10, sometimes 11 sales a week.

Everything always happens exactly for the right reason, and sometimes, exactly at the right time. Click To Tweet

For me and my partner operating out of my garage, it was enough to keep the company going as we continued our work. I had gone to the first COMDEX show. It was a big expense. It was $2,000 and I wandered the COMDEX halls, 2 million square-feet over the course of two weeks. I wore out my shoes. I almost crippled myself and I was so tired. I gave away 100 copies of the software to people that I thought I could create joint ventures with. I also dropped the copy of the software off at the InfoWorld desk. I asked if there was a writer at the InfoWorld desk I could speak with. He goes, “No, but if you give us your software, we’ll hand it to one of the writers.” I did and I forgot about that.

Six months later, we get a phone call, “This is a fact-checker from InfoWorld.” I said, “What?” He goes, “Your software is going to be reviewed at InfoWorld and we’re calling to do some fact-checking. We want to make sure we have the phone number, address, and the price of the product right.” I said, “Sure.” At that point, I told Neil, “Neil, we’re getting reviewed at InfoWorld.” He goes, “Oh my God.” I said, “What do you mean?” He goes, “InfoWorld is the toughest reviewer of all. Even if they give you a decent review, it will crash the company.” I said, “What are you talking about?” He goes, “InfoWorld never gives anybody a good review.” I said, “Now, I’m depressed.”

We waited and nothing happened. Finally, it’s 5:45 in the morning. I’m sleeping in my bedroom and the garage is downstairs. I hear not one, but all six of our phones ringing at the same time. I go downstairs in my underwear and I’m like, “Timeslip Corporation, can I help you?” “I’d like to place an order for Timeslips. Here’s my credit card.” I sat there for three hours writing order after order until I ask somebody, “How did you find out about us?” They said, “What do you mean? Didn’t you see the review on InfoWorld?” I said, “No, we haven’t gotten the magazine yet.”

He said, “You did pretty well.” I said, “What do you mean?” He goes, “You got a 9.3. It is the highest they’ve ever awarded any software. Only WordPerfect got a 9.3 besides you.” It started to happen as all my calls to all the distributors in the chain stores, which never got answered, all of a sudden, I’m getting calls from Egghead Discounts Software. They want 700 copies. I got another order from Ingram Micro. They wanted 500 copies. I got another order from Kenfill. They wanted 1,000 copies of the software. We went from 11 sales a week to 600 a week overnight.

It’s a good growth. Some people reading this might say, “You got lucky. You got into this and it fell in. It seems like a nice rags to riches story.” What I caught out of this is three things that you did strategically, whether you knew it or not at the time, I know you know it now. You’ve got clear on the target. Many companies are out there and they’re spread out all over the place. They’re not sure what the target should be. The second thing I got was you started creating relationships in the form of joint ventures. The third thing was you got free publicity. You got a third-party endorsement from credible entity. Those three things started coming together because you had that courage and grit to see it through, “I’ll show you.” When we were working with Chet Holmes, he would call it pigheaded discipline and determination. You just keep going and you’ll find the way.

That’s the beginning of the story. It turns out that once we got into distribution, we need a bigger space. We moved from my garage to a little 1,800 square-foot facility. We hired some people. We outgrew that in eighteen months and moved to an 18,000 square-foot facility. We hired a bunch more people. We had to move a third time to a 24,000 multi-floor facility, where we were able to house our tech support and a separate place in the same building for our manufacturing. Back then, we manufactured software. Now, all that’s done on the server. Back then, we had to burn disks and shrink wrap them into manuals and then create a shipping operation to do all this. I got an education in every aspect of buying, manufacturing, shipping, pricing, negotiation, and all these things.

The best part was that our initial success proved to other partners that we had value. I capitalize that by going to other software companies and say, “Can we work out a bundle deal where you take our software and you put a flyer in the box of your software and I’ll do the same?” We went to all the accounting software companies and say, “This is not competitive. We do time and billing. You do general ledger PL and all that. Let’s put a flyer in your box.” This is free. We put a flyer in their box. We give them a small percentage of every sale we get from that flyer. The next thing we know, we have a new sales channel. I kept doing that until eventually we must have had 40 people promoting our software.

That again was the beginning. All of these things, what success leads to is more success if you say, “What did I do right? How do I capitalize on that? What does having had this initial success mean to other potential partners? How do I leverage this into that?” That’s what happened for the years until we kept growing, and then we hit points where we have tough times. What we ended up doing is we plateaued. Being plateaued is scary when you have a growing company and growing expenses, but I ended up discovering something completely unorthodox and I decided to pursue it. I ended up asking one of my existing clients to help another client with our software because she was having problems in her office in Los Angeles.

I was in Massachusetts and I asked her if she could go over and help this other client. It was an important client. She turned out to be the technology chair of the Los Angeles Bar Association. If she didn’t like our product, she could make waves for us in a bad way, but if she did like our product, she could make good waves for us too. I asked this customer who I didn’t know well. She knew me because we were good at communicating. We sent out emails, newsletters, and magazines every week to our customers, keeping them informed as to what’s going on with the company, the software, tips and tricks to use the advanced features, and this is all before the internet.

Business Success: A tribe is a culture-based community.

I called this woman and I said, “Anne, I need your help. I apologize to impose on you. I’m happy to pay you. Can you go over and help this woman?” She goes, “For you, sure. I’d love to. Thank you so much for even thinking of me.” I waited on pins and needles while she goes over there. I’m waiting to see what happens. Finally, the phone rings at 9:00 at night and she says, “Mitch, it’s all taken care of.” I said, “Thank you so much, Anne. I am happy. I appreciate it so much.” She goes, “I didn’t tell you the best part.” I said, “What’s the best part.” She goes, “She gave me $100.” I said, “Really?” She goes, “Yes.” Here’s the next few words that changed my life. She said to me, “If you need anybody else who could use my help, let me know.”

That’s when this blinding light exploded in my brain and said, “What would happen if I had 10, 100, 300 Annes all over the country supporting and selling software?” I decided at that point to create a test. I built a test and I sold the test for $500. Before I knew it, I was generating $20,000, $30,000 a month in tests. Once they pass the tests, I certified them. That was my mistake because about 90 days later, I started to get complaints and threats of lawsuits because these people might have passed the test, but they were far from acting as a professional coach or consultant. After dodging several lawsuits and calling 60 people to interview them personally as to what went wrong, I shut down the program, but I knew it was a great idea.

I did the research and I created a plan to rebuild the program but fixing all the mistakes that we had made. We did that. We relaunched the program and quickly, we ramped up to 350 certified consultants, all paying us $5,000 a year to be certified. They were selling our software and we gave them a small discount. We ended up doing four important things overnight. The first is generating $1 million in profits per year from the certification fees. The second is creating our third-largest sales channel by enabling certified consultants to resell all of our products, including upgrading our existing customers. Third, we dropped our tech support costs by 20% because of all these great certified consultants. Finally, what we ended up doing, we shut down the competition. Why? Because no other time and billing software vendor had offices in every major city in the country.

Could we encompass this and say probably your main strategy for growth because 350 people at $5,000 is $1.75 million a year in recurring revenue, which is pretty much all profit. Even a company doing $20 million or even $200 million would love an extra couple of million dollars in profit just coming off the game. What I’m getting out of this, and this is uncanny because I’ve seen you roll this out in Business Breakthroughs International and the other thing that you’ve done, is you’re using the power of promoting your own horn through other third-party endorsed people. You’re building a tribe of people who are your advocates. They’re going to go to the streets for you.

You’ve essentially built a large sales team on full commission, but you built it as a tribe. Here’s the deal. You sold that company. You became independently wealthy at the age of 42, and then you moved on. You built Business Breakthroughs International with Tony Robbins and Chet Holmes. I want to fast forward because the main strategy that you use is which I know you used also at Chet Holmes and you’re using now in your life, which is building out tribes. You wrote this book called Power Tribes. For those of you don’t have it, it’s Mitch Russo’s Power Tribes. You can get it on Amazon. Is there another place they can get it?

They can go to PowerTribesBook.com. They could still buy it on Amazon, but they get a $500 course free along with the book purchase.

I would go to the free $500 bonus gift there and go to the website. Any company can use this concept if they know how to. You’re an expert in this field, and I know this. We built over $25 million company building out tribes in some capacity with Chet Holmes and Tony Robbins. You’re doing this as a living because you’re an independently wealthy guy, and you want to have a business where you don’t have 300 or 400 employees anymore. What is the number one reason that anyone, including the audience, should be building a tribe?

Being plateaued is scary when you have a growing company and growing expenses. Click To Tweet

Let’s create a distinction first. What most people think of is a salesforce. Most companies either should or do already have a salesforce of one sort or another, but a tribe is a different animal. A tribe is a culture-based community. What is the purpose of the culture? When you have a culture at a company, it is how people feel about working at that company. More importantly, the culture dictates behavior. What would happen if you deliberately created a culture even before you created the team? That’s what I do with Power Tribes. I create what I call a culture Parthenon. I borrowed that word Parthenon from Jay Abraham.

What I mean is that the roof of the Parthenon is the core value of the CEO in the company. If you can visualize it, the values are sitting up above the tribe. The columns of the Parthenon are the codes of ethics that we create with our clients. The Code of Ethics are individual codes that dictate behavior. For example, anything on our website is the property of our company, you cannot take that and repurpose it on your own, and you can’t do it without our permission or attribution. That happens to be a code in the Code of Ethics. Another Code of Ethics might say something like, “You can never treat another person in a way that you wouldn’t like to be treated.”

Another thing is that we never support competition. We support coopetition. If you ever find yourself in a position of being competitive with somebody on your own team, please ask for help because we could show you how not to need to be competitive and still make more money either way. There are 38 of these codes that I provide for my clients. Once you build this and then you start enrolling people, something magical happens. The tribe becomes self-fulfilling and self-policing. Instead of dealing with colorful characters who might be negative or try to take people down, instead of all of that coming back up to the CEO who might have to deal with it, now the tribe does it by themselves.

It’s self-regulating. I’ve had situations in my own tribes that I built where people have gotten negative inside the community and others have said to them, “This is not how we are here. You see the Code of Ethics. It says right there. This is not what you’re supposed to do and maybe you should quit. Maybe this place isn’t right for you if you’re going to feel this way. Most of the time, people get right back in line because it’s the culture that dictates behavior. If you take the time and build it first, it pays huge dividends later.

That is an insightful insight. It’s valuable because what most people think is, “I go out and build a team or a community of whatever,” but they never think about what the community is supposed to be doing to get the outcome that you as the business owner would like to have. The people who are joining also want that same type of outcome. When you build something like that, it creates massive loyalty. Even Apple when they were first getting along. People at Apple were vehemently defending Apple’s brand. If you were a PC guy, you were on the low totem pole at that point. You were down there. I would witness verbal arguments over Apple products with people promoting them. You build this out, get this community going, and then you can monetize that community or the community monetizes itself for you.

As long as you are upfront with people, “It’s going to cost you $5,000 to join on a yearly basis, and this is what you get for your $5,000,” and you tell them in advance what things are going to cost and what opportunities exist, then by the end of that year or sooner, they’ll know very quickly whether or not you could be trusted, whether you are being upfront and doing what you said you do. My belief is that you don’t do what you said you were going to do, you over-do or over-deliver. By the time that the following year comes around, we then use a simple mathematical formula to figure out how much we can charge for certification.

One of the ways we do that is very simple. We simply say, “How much could somebody make using certification as a certified partner?” If we do the back of the envelope math in five minutes, this guy could probably make six figures. If we charge $10,000 or even $20,000 for certification, then we know the next year, if he made $100,000 plus, he’ll pay another $20,000 to stay certified. If he can only make $40,000, then we can’t charge $20,000 for certification. In a simplistic way, there are more factors, but this is one of them. We project what the average certified partner can make, that’s how we figure out how to price certification. We then lower the price for the pilot program so we can get a bunch of people in early, we can get a bunch of people through, a bunch of people successful quickly. We then harvest those testimonials and we use that to sell the next class of certification.

You self-fund this right from the beginning. For a lot of people reading this, no matter what side they own. If they own a $100 million company, they want to create a certification or some type of thing, they’re thinking they’ve got to put a ton of money into this thing right upfront to make it work.

You got to pay me to consult with you and make sure your program is a success. Other than that, the only real money you’re investing is in resources. You need to have an incredible training program. I guide my clients to build that. You need to make sure that you have all the mechanisms in place to support your certified prop partners, no matter what they are, whether it’s CRM, automated systems or sales systems. Here is a big difference between what I do and what other people who do certification do. What do we know about coaches when it comes to sales? They’re great at coaching.

Most of them are not great at sales.

If you sold a certified coaching program, they spent their money to buy it, that certificate hangs behind their desk, and they never made a nickel. Are they going to pay you another penny again?

Not likely.

What would happen if you decided to take care of that person and support them? What would happen if you created a lead flow for them? What would happen if you hired a PR person internally inside your own company for the sole purpose of setting up presentations for all your certified partners locally, so that they get a phone call out of the blue and say, “Bob, are you available on Thursday night at 10:00 to speak to the Marlborough Bar Association?” They’d love to have you, and have you talk about the services and the business you’re doing. These guys go, “I’d love to.” This is what we do. That’s just the beginning. We do all kinds of programs for our certification team. Do you remember what we did at Business Breakthroughs with spiffs and promotions? We do all the same thing with our certified partners because the bottom line is we want them to be successful.

Let me take a wild guess here and say, when they’re successful, they’re going to go out and tell other people how successful they are. Others are going to notice, then they’re going to say, “What are you doing?” Maybe that leads back to the additional free referrals coming in, you spiff the referrals come in or whatever it might be. You’re growing the tribe and continuously growing it through an organic method. You’ve got to get it in there. What could be your average return on investment? Is it like I put $50,000, $100,000, or whatever it might be into this program, and I could expect to get back 2 to 1, 5 to 1, 10 to 1, or 20 to 1?”

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When we begin the process of screening a potential client to work with us, the first thing we do is run a P&L. I’ve built a custom P&L for certification. We start with the group of base assumptions. With those assumptions, we’re able to determine relatively quickly whether or not it’s a fit for them. Some of those assumptions are like, “How many customers do you have? If you have less than 500 customers, it’s going to be hard to sell certification. It doesn’t mean you can’t, it’s just harder.” If you have over 1,000 customers, it’s a slam dunk. If we go back to Chet Holmes’ beautiful stadium pitch idea, he said, “If you use the triangle as an illustration, where inside the stadium, the top 2% or 3% are the early adapters. They are ready to buy as soon as they sit down. You then go below one level. Those are the ones who want to wait and see how the early adapters did before they buy.”

It’s the same thing. In any client base, there are early adapters. If you have 1,000 people in your client base, you offer them certification and it costs $20,000. You could justify it and show them how they’re going to make money. They buy it and they’re successful. That means you’re going to get probably 20 or 30 people who say yes, so you’ll make $200,000, $300,000, or $400,000 on your pilot class. Once they’re successful, you take those testimonials. You now move down the pyramid one notch, and you promote it to the less than early adopters, the ones who wait to see how many arrows the early adapters got in their back before they buy.

Once they see that the early adapters were successful, then they step up and buy. They’ll pay a little more and they know that. They’re okay with that because they value security more than a lower price. At that stage now, when we run the P&L, we’re generating between 65% and 75% profit margins. Whatever it is that we charge and need, the big upfront expense besides my fees is infrastructure. You got to have courseware. You’ve got to be able to work with me to create the type of training program that will guarantee 100% competency. I worked with Tony to help build his learning management system back in those days. Tony taught me a lot about how people learn. I now take a lot of what I learned from Tony and I build it into all of these programs with my clients. We’re taking people and guaranteeing 100% comprehension when they graduate through these programs.

For those of you who don’t know who Tony is, that’s Mr. Tony Robbins, a large man in stature as well as in finance, bank accounts, and heart. Mitch, is it like 65% to 75% profit margins?

Yes. I can pull up a spreadsheet and show you. That’s how real that is.

I remember you and I working on profit margins back in the day. I believe you’ve got them all worked out because I know what your spreadsheets look like. If anybody wants to get a hold of you or they go, “I want to build a tribe,” why shouldn’t they unless they have less than 500 customers? How do they get ahold of you?

MitchRusso.com is my main site, but for the Power Tribes opportunity, the easiest thing to do would be to go to MyPowerTribe.com. You’ll be able to watch a short cartoon video of the process and a testimonial video. You’ll be able to fill out a form and apply to have a conversation with me about it. In that conversation, which is comprehensive, that’s a learning experience for most people who could take me up on this offer. They’re going to learn a lot about their company, certification and profitability.


I guarantee it’s worth your time. Mitch and I have spent years and years working together. I know what quality he brings. Go there now if you’re thinking about it, don’t wait. Is there anything you want to give away potentially to the audience?

I have something, and this is my pandemic project. I was bored, so I decided to create a guide for all of the marketing techniques that I know of. There are 28, and that is a little book called Profit Stacking Secrets. You get every one of my strategies in it. When you buy the book, I include a 60-day email education program as well. The emails are more in-depth than the book.

Power Tribes: How Certification Can Explode Your Business

What you’re going to get is an in-depth overview of 28 different marketing strategies, and more to come. The first three are free. You go to ProfitStackingSecrets.com, download the free report that will give you three free publicity strategies or low-cost publicity strategies right away.

All three of them are great. I can tell you because I’ve gone through the program. I looked through that and Mitch is right. I invested in it. He didn’t give it to me for free, and I wouldn’t have expected that. The fact that I invested in it, I went through this, and I can tell you firsthand that these are detailed. It’s not just a line list of stuff to do. This breaks it down. You can even get a calculator and a financial spreadsheet on this whole process, which I did too. That’s comprehensive. Mitch, if you could spend one day as a superhero, who would you be and what would you do to make the world a better place?

This person is a superhero, but not with a conventional superhero would be. My answer is Buddha. If I could be Buddha for one day, what I would do is I would use modern technology to share that message with the world. The one thing I love about Buddha is that he said nothing that offends anybody. There is nothing that Buddha teaches that conflicts with any religion and belief system, except communism in China. I don’t think they like Buddhism there. The bottom line is that if I had the ability to reach thousands, if not millions, maybe billions of people with the message of Buddhism, it would be an incredible gift not just to me, but to many. That’s why I’m answering the question the way you asked it.

Knowing you, I can understand that, and a guy who studied Buddhism myself, I can relate to that. I bet a lot of the readers can do the same. I want to thank you for being on this. It’s been a blessing and I’m grateful.

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It’s my pleasure, Doug. Thank you.

You are welcome.

What a lot of great information on this particular episode. One of the biggest things that people forget about is in building a business, not everything is going to go straight up. We always have our times. Mitch was candid about that where he had his times where things went up, they plateaued. They had to figure it out again, or things went up, they went right back down, and then they had to figure it out again. His attitude around, “I’ll show you,” that courage and that grit, that no matter what or what Chet Holmes called pigheaded discipline and determination. That is one thing that can take your company and move it all the way because you will have hard times where it’s like, “Can I get to this next level?”

If you have the right strategy, mentors, courage and grit in place, you can make it through anything and excel. I appreciate Mitch’s point of view. For those of you who have not built a community or tribe, and who want to build a tribe, I highly recommend Mitch. I worked with the man for multiple of years, and I was part of helping build that $25 million company with Tony Robbins and Chet Holmes. Mitch displayed everything he talked about on this particular episode that he displayed while I was working for him. I learned a lot from the man and I’m grateful that he was on. If you liked this show, please share it with someone else that maybe it could help them move to the next level. If you like this show, please go up and give me a review. Five stars would be perfect. Thank you. Go to Doug@BusinessSuccessFactors.com. I’ll look forward to another episode being together.

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About Mitch Russo

In 1985, I entered the software business as the founder of Timeslips Corp (sold to Sage Plc) after creating the largest network of Certified Consultants in the software industry. After selling my company, I then ran Sage Plc in the US as the COO, with over 300 staff.

Independently wealthy at the age of 42, I wanted to give back to other entrepreneurs. I got involved in the VC community, first as an advisor to startups and then as the CEO of the largest furniture shopping site early in 2000, FurnitureFan.com. As a CEO Advisor to several companies at the same time, I participated in many different business types, solving many diverse types of problems in sales organizations, marketing, technology, systems and HR.

I later became interested in options trading and mentored with a floor trader at The Chicago Board of Options Exchange.

I made it through the 2008 stock market crash unscathed while helping Chet Holmes build his now-legendary coach and training business.

That lead to a 3-way partnership between myself, Tony Robbins and Chet Holmes.

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