How to Build Systems (So Your Business Runs Without You)

I went from barely making six figures a year while grinding a hundred hour week struggling to get ahead to today making over a hundred million dollars a year working half the hours and owning multiple businesses that run without me. SOPs and spreadsheets alone, they won't save you because your business only runs when you're there. So today I'm going to show you how to flip that and build a business that runs without you even if you're starting from scratch. That way you finally get the freedom you started a business for in the first place. Welcome to the Martel Method. I went from rehab at 17 to building a hundred million dollar empire and being a Wall Street Journal best-selling author. In this podcast, I'll show you exactly how to build a life and business you don't grow to hate. And make sure you don't miss anything by subscribing to my newsletter at MartelMethod.com. First things first, we need to define what I like to call your North Star Metric. You need to be able to tell me what is the math equation that defines your business. If you know this, then everybody on your team can align to it. You can optimize for it. The North Star Metric is that one number that if it gets better, it tells you the business got better. If you don't have one, it's kind of like building a house without a blueprint. Everyone's running around hammering and sawing and putting up walls and all of a sudden you step back and you look and it's just a pile of lumber. Like you haven't built a home. Every business I start starts with a North Star Metric. For example, restaurants, revenue per seat. My media company, revenue per followers. Martel Ventures, enterprise value created for dollars spent. The way I came up with that is I'm putting my money into a business and I'm creating enterprise value because you don't get wealthy with revenue, you get wealthy with equity. And that's the way we measure enterprise value. So of course, the dollars I spend to generate equity value is the ratio that if everybody can get aligned with, then we make it better because enterprise value is creating predictability, durability, and revenue that has nothing to do with cashflow. Think about it for you. Is it revenue? Is it lifetime value? Is it retention? Is it customers? Is it five-star reviews? Once everyone's clear and building in that same direction, your systems actually start driving real outcomes, not just keeping people busy. But let's be real, just knowing the metric doesn't move the needle. There's still some work that needs to get done. So the next step to build a business that runs without you, clone yourself with the 108010 rule. You don't scale by doing more, you scale by strategically inserting yourself at the right moments. And in many ways, doing way less. It's kind of like Steve Jobs. If you actually like go back and hear how he worked with his teams, he didn't do all the steps. He could have never possibly done that. When he built the iPhone, for example, he talked to Johnny about the material science and the different equipment and the design and the thoughts. Then Johnny went off and he built prototypes. And then Steve came in and they talked about it and they refined it. So this is how you do it for yourself. And that's why it's called the 108010, the first 10%. That's where you set the vision. You talk about what the definition of done looks like. You talk about the essence of it, the way the customer's gonna feel, where you've seen it done well. If you can draw a picture, draw the picture. If there's a wireframe, draw the wireframe. But the clearer you can communicate the vision, the better this is gonna work. The second step is 80%. It's let your team run, let your team execute, let your team do the work based on the vision that you both agreed and saw together. And the final 10%, this is where your taste comes in. This is where the refinement, it's review and polish. That's for Steve Jobs was getting on stage and doing the demo. That's his favorite part was, okay, based on what you built, I'm gonna demo it this way, this way, and this way. So make sure we refine it so that it really pops when I talk about it on stage. The magic isn't doing it all, it's knowing when to show up. Here's my favorite quote on the topic, 80% done by somebody else is 100% awesome. And guess what? If it's not, go be better. The more you stay in the vision and the review part, the more your team can scale without you. Next, we need to talk about what I like to call the camcorder method. Let's be honest. We all hate SOPs. Making them, updating them, reading them. I mean, it's so crazy. Like people have these fully documented systems that nobody opens, nobody looks at, and they honestly, they become stale in like six months after you create them in the first place. However, they're a hundred percent necessary. I like to do it completely different than the way most people do. The best systems aren't typed. They're recorded. A few years ago, I was talking to my friend and he's like, yeah, I created an SOP, but it didn't really work. And I was like, well, how'd you do it? So he said, I took my whole team. We went to Tahoe for an offsite. We spent three days building the company way, this document, this handbook, and everybody spent all this time, document every aspect of the business. And then they got back. Nobody ever used it. And six months later, it became stale. It wasn't even updated. It wasn't useful. That is not the way to do it. Instead, use the camcorder method to document how it's done so that you've got the training. Then the person creates the checklist. Then it's their responsibility to update it and maintain it. Not for the people at the top to do it. Plus it's done while you're doing the work, saving you all that time. So instead of a regular SOP, I use what I call the camcorder method. And this is how it works. First, press record. Meaning like on this really expensive, hard to find software called Zoom, you can get on a meeting all by yourself, share your screen, record it to the cloud, hit record, and all of a sudden do the thing you're doing. The only difference is you talk out loud and explain why you're doing what you're doing. If it's processing your inbox, if it's creating a pitch deck, if it's having a sales call, whatever you do, just record it. Once you've got the recording and you've got a few of those, then you can give it to somebody else. Let your team turn it into a repeatable system. Have them document and create the checklist. So with that, now your marketing, your ops, your fulfillment, your hiring, they all get done without you becoming the help desk. Before we get back to the episode, if you want to jumpstart your week with my top stories and tactics, be sure to subscribe to the Martel Method newsletter. It's where you'll elevate your mindset, fitness, and business in less than five minutes a week. Find it at martelmethod.com. We can now move on to the next step to make sure your business runs without you, running the business by the numbers. Here's why. Numbers don't lie. People do. I've seen great people try to tell me what they're feeling, and I believe, and I think, and I've seen. Show me the data. I understand you're bullish. You've talked to this person. They gave you some optimism about what's going to work and how it's going to work. It reminds me of this guy I knew. He had this agency and he's like, yeah, I don't really like looking at my numbers. I'd rather just do it the way I feel. I mean, that's why I have a business in the first place. And then his revenues went down and he blames marketing. Customer's upset and he fires someone. He has no metrics to understand what's actually happening and where it's broken. And he thinks that just because of his desire to run the business based on his feelings, to have the freedom so he doesn't feel like he's like built this prison of structure. It's like, dude, you're firing people and the customer's upset. That's enough for you to decide, hey, I probably need to get the data. So to do this in a way that you don't go insane, you just need your team to report on two things. The first off is you need the leading indicators. The leading indicators are things you're going to measure that are correlated to the outcome you want. Y'all want more profit. I get that. Number of profit goes up. You're happy. But what you need to teach the team is to figure out what are their activities they do before that happens. If it's a sales function, it's the number of calls they did that day. If it's a marketing team, it's the amount of leads they generated. There needs to be leading indicators that correlate to the results you want. That brings us to the second type of numbers you gotta look at, which is the lagging indicators. These are things like revenue and churn and profit that happen after the fact based on activities that came from the leading indicators. When you can get everybody to understand I do this and the volume goes up and then the lagging indicators goes up and everybody wins and you connect those two things, now you're running a business with numbers that you don't have to be involved in. Here's why. What gets measured gets moved. Now you know exactly what to measure. You've learned how to clone yourself with the 10-80-10 rule. You've built systems with the camcorder method and you're running the business by the numbers instead of gut feel. But here's the question I hear every entrepreneur who finally steps back. If my team is running the business, then what the f**k am I supposed to do now? And that's where most founders either slide back into the weeds because they feel useless or worse, become completely disconnected, stop innovating, and ultimately cause their own business to stall. When the business finally runs without you, you need to step into your next level, which brings us to our last but arguably the most important point, leading from your zone of genius. It's the thing that you do that creates value for your team, for your customers, for your family, that honestly, if you didn't even get paid to do, you'd probably be doing it anyway. That's why I always think the best businesses to start are doing the thing that you do when you procrastinate. Think about all the people that all they do is spend time on YouTube. They should just get a job doing YouTube stuff. The way I like to think about it, it looks like work, feels like play. So here's how you find it. First off, find the high leverage moves. Think about vision, mission, values, the stuff that only you can do as the founder. Then what you want to do is build a team that builds the business of like really talented people that you trust, that are creative, that are driven and share in the upside with them and then lead like an artist. Think about what an artist does. They bring strategy, energy, taste, essentially magic that only you can. Now, if you tell me you're stuck just managing tasks, you're not leading, you're just limiting. Your job is to multiply, not maintain. When you operate from your zone of genius, you stop being the glue and start being the accelerator, the gasoline. That's when the business actually scales without you and because of you. Most people don't allow themselves to integrate all aspects of themselves so they can truly live into their zone of genius. And look, if you're a business owner and want help directly from me to implement these strategies, just message me, coach on Instagram and let's make it happen. Thanks for listening to Martel Method. If you liked this episode, could you do me a huge favor and go leave a review? This helps us get the podcast more ears and helps more people get unstuck, reclaim their freedom and build their empire.