a couple weeks ago I interviewed a $300 million entrepreneur in Houston Texas excuse me sir is this your Ferrari yeah it is what do you do for living out in Houston Texas to be able to afford a Ferrari I'm an entrepreneur and how long have you been a business owner for 21 years and what type of business do you run I own a uh labor force management company how important was it for you learning how to master delegation let's put it this way how important is it my company will do 300 million this year in Revenue right if I were still doing it all myself we might do three that video got over 20 million views across social media his name is lwis and he invited us out to his private car collection it's worth over $20 million to drop some more game for you guys so with that being said let's go see what Lou has to say l how's it going my friend oh wonderful sir good to see you thanks for having us out here man yeah absolutely this is the uh this is the private car collection right here this this is it this is it it's pretty well hidden which I like and it keeps uh things private but uh yeah here we are this is this is most of it yeah so I interviewed you out in Houston Texas the video got over 20 million views across social media I never expected that that was crazy yeah you built a $300 million company yes yes absolutely and we're at your private car collection now how many cars do you have here so today I think we've got 21 cars here currently in the uh at least in this Warehouse right now can we check some of them out and just kind of like see got yeah we've got I think we've got about 14 uh 14 Ferraris currently in the collection about six Lamborghinis and then there's other things you know Rolls-Royce couple of Porsches here and there there's some stuff that only makes sense to me like uh my very first car when I was 17 smoking a bandit trans I got to ask you about these two these two Lamborghinis right here I see the these are insane gold and orange Lambos right here growing up did you ever think that all this was possible did you ever think that you were going to make all this happen when you were growing up you know what I I definitely had the dream the dream was actually of the Kash here in the very back but I will tell you I didn't have a dream this big yeah uh but but you know I think the belief in yourself comes one way or the other uh and then where you have some achievements and you make some things happen that dream begins to grow bigger and bigger as your confidence grows so what's more important mindset or skill set mindset 100% yeah uh I talk about this all the time you know I can give you skills but I I can't control your mindset I can't give you passion I can't give you drive and what type of business do you run so effect is a labor force management company so we partner with companies all over the United States and they Outsource their entire labor force to us and I noticed the Ferrar right over here this is the fry that I actually interviewed you in yeah that was the one you came up to me in that day which is crazy in fact I'm not even sure if I had a chance to drive it since I saw you last yeah that's incredible I mean you kind of have that moment where like you don't even know what to choose from pretty much a lot of the time that you know it's two big decisions of my morning and this sounds kind of silly but it's what what car am I going to drive and what watch am I going to wear those are my big ones yeah that's incredible man do you think everybody's built for entrepreneurship absolutely not I I I it is tough you know I was mentoring a gentleman yesterday someone I I cared very dearly about I've known this person for a very long time and and he's got great ideas and he's had some some terrible failures and not from lack of of trying or caring but at the end of the day you could just tell that the risk of being an entrepreneur that the toll that it takes him it's more than it's not mentally healthy for him and that's I see that with most people in fact when most people come to me for mentorship about being an entrepreneur I usually try to spend a lot of time talking them out of it it is it is very very very difficult and did you know that one in four millionaires are living paycheck to paycheck unfortunately yes isn't that insane so from your perspective what keeps people broke in today's world spending money absolutely uh you know I think that I don't know whether it's through social media or things like you listen I've been collecting cars or watches for a long time and I've seen this massive explosion in the last 7even eight years of more and more people spending a lot of money on cars and watches and second home homes and things like that and I think people continue to go out and get more and more leveraged and things that they shouldn't get leveraged in taking on more and more debt I think I I've been reading actually currently right now where Americans now owe more credit card debt than at any other point in time in history even though we as a as a as an overall country are making more income than we ever have uh as a as a whole and yet we have more debt people are going out and blowing money on things that have no Roi they they're not spend money on things that make you money right don't go out and blow money on that new Rolex that new padic that Ferrari the new Lambo or whatever it is invest that money in something that's going to give you an Roi people are taking out debt to buy consumable products and things like that and blowing their money like you said one in four millionaires Liv in paycheck to paycheck what does that tell you no matter how much money you make you still got to live within your means you know we were making good money but every dollar I made every week had to stay in the company to reduce my debt liabilities the next week so I can do of that down week after week after week then once I got the company out of debt then I still had to build my balance sheet and retained earnings to be able to grow and fund the uh our our scale and growth eight out of 10 businesses they won't make make a past 5 years what's the most common mistake that business owners make in today's world they get the company to where it's doing okay or or good enough and they quit growing look we're doing 300 million this year in Revenue our goal is a billion right and it reminds me of the the quote that Jack Welch said where he said the day you stop growing as a business is the day you begin to die on the vine and it's so true you've got to continue to grow and scale that business the moment that you don't the customer base whatever you've got recurring your revenue is going to begin to dwindle your competitors they're not resting on their Laurels they're operting their business they're getting better and better and better and they're coming for you the game you're dropping is amazing I'd love to be able to sit down and ask you some questions is that cool absolutely man let's do it right so now I interviewed you back in July one of the things that I asked you right because getting that Capital to start businesses is a big problem that a lot of people face and and you said that you had to beg B and steal to get the means to kind of start that business can you kind of break down in your opinion the most efficient way to get the capital to start and grow businesses in today's world and how you did it and versus maybe in today's world what you would do if you were a business owner today what is that blueprint that you would take to get the money to start and grow businesses right right you know a lot of people um come to people like me today right or other very successful entrepreneurs looking for the investment okay and and that's not necessarily wrong I I think there's a lot of good to be done there but but let's be honest if you come to me and you've got a great idea right and you haven't launched anything yet you're looking for seed money right I'm taking all the Financial Risk you're going to risk your time and some SED Equity but if it goes south it's my money not yours right and uh and I'm going to be in control of that money how that money gets spent you let's just say you're a young man or young woman coming to me little to no business experience or Acumen but you've got a great idea and we both believe in the idea I see great ideas happen all the time that don't succeed because they don't know how to execute so we'll get I'll talk more about execution in a minute point is though you come most people are coming to people like myself or other successful entrepreneurs uh looking for that Capital up front well we're going to want to be in control of how that money gets spent so we're going to want majority equity in that in that Venture right 51% plus depending on the deal right and usually seed money is is a 70% partnership where you're getting 30 and but I'm taking 100% of the Financial Risk so there's give and take there for me what I like to see people do and where they're going to be in a much better position for a capital perspective is to start trying to cash flow their growth I see in fact I just had a gentleman here yesterday I was meeting with mentoring him and he took out a $100,000 loan to put it into this business right the business was already generating Revenue I'm like why didn't you not pay pay yourself as little to none as possible live off of some sort of savings live a very menial life for a long time build up that money right rather than going taking out this loan you took on all that risk at once and you didn't have the revenue to support it so I'd rather see people cash flow issues uh their growth like that in small chunks right now for me as I mentioned that first deal was $9 million a year right annualized Revenue they needed 30-day pay terms right uh so I needed what about about about a million roughly because 30-day pay terms plus your fifth week of expenses going out hopefully that payment comes in on time right so we're looking at five weeks that you're having a cash flow so I need about a million bucks I went to what's called um invoice factoring type of services or accounts receivable factoring and that's it's horrible it's 21% interest rate right when it's all said and done that's why I refer to as lone shark money right and they essentially every week I present my invoices they buy them from me and would loan me uh I think around 90% loan the value of the invoice right and as awful as that was and as painful as it was for a long time I couldn't pay myself money for a long time we talked about the tax situation that I had right going into my second year I'll talk more about that in a second but it was excruciating but I looked back on it today and where's it gotten me today I've learned Financial discipline right because I could not take money out of the company even though the company was making money every week I had to leave them money in the company so that next week I'm borrowing a little bit less at 21% and a little bit less and a little bit less that's number one so I learned how to number one live well below my means I learned how to build up a balance sheet in a business which is imperative right and third I'm sitting here today and I still own 100% of my business I never sold off shares of my business to get the money that's not always possible depending on what type of business you're going into and how Capital intensive it is up front but even if somebody comes to me and says hey you know I need $2 million $3 million $5 million whatever the number is to start something up I first look at did you even try to cash flow any of this yourself or you just asking for somebody to take 100% of the risk up front and all you have is an idea right immediately that's a red flag to me I want to see that you already started hustling you already started DET turning some Revenue maybe at a very small level you know you can scale it to X Y and Z that's great I'll help you get there right if I really believe in it but I want to see that you've already taken the steps to bust your butt make the financial sacrifice and start growing it in small increments and your cash flowing and now we've got proof of concept we know this business concept or idea is going to work now let's put the money into it to scale it and by the way if that's the case you're in a much better position to to negotiate with someone like myself relative to U shares and ownership of the business because I'm I'm now funding uh uh scale and growth I'm not funding something that's just a raw idea looking back at your career running this business as a whole how did you go from a 10 to $100 million company so Focus I made it all about our customer okay uh that was how we listen even if i' had been strongly capitalized right I still had to grow by relationships with customers right and so two big things number one by focusing on what was best for our customers they continue to turn over more and more of their business to us so that we were able to mushroom the relationships that we already had right and then by way way of working on new customers by coming in with more of a consultative sales approach where I'm here to see how I can make your business better and I I don't if if I can't make your business better you don't owe me a dime but if I can come in and show you that we can do these things and make you more profitable and make you more competitive in your industry then maybe we have a reason to do business together right that's really what we grew from from a new business development standpoint the growth obviously from a capital standpoint was like I've talked about earlier being extraordinarily disciplined to continue to build my my retained earnings build that balance sheet so that I had the money to fund my growth so you got to have both I've got to have people that believe in in your service willing to sign contracts with you and I got to have the money to fund that growth both of those have to happen along the way is where you start so okay I've got new customers coming in now I've got the money to fund the growth now how do I get everybody on board with what we're trying to do how do I get success uh okay we've been successful with these three or four sites now we've got four or five new ones how do I get people on board to to op you know for to to do daily operating procedures standing operating procedures consistently every day and get consistent results over and over over again well that's when you get into the training development side of things right getting into very good Sops and then the third piece and the most vital piece is what we've been spend a lot of time talking about and I talk a lot I spend most of my time talking about this because if you don't get this piece right not only will your success be very limited at some point you're going to be crippled because someone like me is going to come steal your talent I just absolutely am and that was was the leadership style building that company culture of treating people with respect and loyalty and making them feel valued and rewarded for the job that they're doing knowing that I'm here for you right if you're giving me your best I will invest in you I will back you I will be here for you I will defend you you make mistakes we're going to learn from them together I'm not going to point the finger at you uh none of that we're going to learn and grow together and I want you to have the freedom to take those those risk right if you're going to give people accountability right they they they've got to have authority right you can't just you know nail people down and hold them accountable for any little thing that they do if you give people Authority come then comes the accountability well they got the authority to to do things to push the envelope of the business right think of things that you don't think of yourself if you don't give them the freedom to do that then the company's never going to be any better than you as the as the CEO or the entrepreneur of that business and that's a scary place to be because I don't care how smart you are you're still one person right I I'd rather sit in a room where there's five people sitting in this room uh and I always tell them I'm number six let's just so say to speak that it's an executive meeting right and there's six of us sitting in the room if you're in that room you're here because I think you have knowledge experience expertise outside of what I have I want you to tell me where I'm wrong I want you to tell me why this won't work but I also want you to tell me what we're going to do to make it work right Lewis that won't work but here's another way we can make that happen Lewis I don't think this is going to work but here's another way we can achieve that same goal that same vision you you bring value to the table and so people have that freedom to take that authority to tell me that I'm wrong disagree with me push me challenge me right and when we have that now we have something real cohesive and collective in the room hard KN family we're about to get right back to the interview but I've got a very special announcement to make a couple weeks ago we recently launched our official entrepreneur Community the school of mentors if you want to be able to hop on live calls every single week and ask your questions directly to entrepreneurs just like Lewis and get access to this full uncut interview as well as tons of other master classes go to the link down in the description of this video to join we'll see you on the inside of the community but with that being said let's get back to the video relationships right as a business owner you're starting a company you're more of a Visionary it seems like how do you go about kind of navigating to find the right relationships to not just build within your company but just in the business World in general right whether it's lawyers accountants tax people whatever it may be how do you you're the entrepreneur you build this company you built a big business how did you go throughout your career and maybe what would you have done differently like who are some of those relationships you would have made very early on banks investors whatever it may be oh that's a good question yes uh be F establish relationship with est aish relationships with Bankers as fast as possible you're going to need them if you're going to scale right you know I talked about the uh uh the loan the the invoice factoring that we did and what but that all was to get to the goal of getting to a traditional line of credit with with banks right and so even though I wasn't our our our balance sheet wasn't there yet I started developing relationships with Bankers during those early days and then letting them guide me where do I need to get my balance sheet to so that I would be qualified for line of credit with you of this size right because we grew very quick so I I think in our second year that was probably third year probably third year where we finally got where we could get into a true traditional line of credit at that time our borrowing needs were almost $14 million and the company's only three years old right and uh so I started working with Bankers got them to believe in me right believe in my Integrity my credibility right because they want to be taking risk with people that they believe have strong credibility and I started having them guide me where they where I want to get my bance sheet to then they saw me making those steps and doing it and then once once we actually we weren't even quite there and one particular Banker who's now my neighbor by the way uh That's How Strong the relationship was uh bought the house next door to me uh wasn't quite there but he saw that I'd done consistently been building the balance sheet retained earnings doing all the right things and he saw that we were taking on wise risk not stupid risk put us in our first facility line of credit and tremendously changed the business forever from there but I would strongly suggest absolutely Bankers investors if that's the direction you have to if if it's a capital intensive business up front start establishing those relationships before you have the need right or you have the need but but hey here's the goals and let them see you achieve those goals along the way they know that now they're betting on a consistent winner they will take that risk with you right the other big thing too get in and I wish I would have done this and I I didn't do it I wish I would have gotten involved in some organizations uh where we're not trying to sell to one another but we're really there as as business owners Entre entrepreneurs CEOs whatever uh that were there to collaborate hey I'm I'm I'm I'm having this struggle in the business I'm I'm struggling to understand how to maximize this or to improve upon that and sitting in a room with people just collaborating and chatting about their experiences and what they're going through and what they've been able to learn from hey you know we did it this way maybe we should try this maybe we should try that reach out to our mentorship uh group not just one person but a group um and it's got to be a group I think this is really the key thing no one's there to sell one another anything we're just a soliciting group right those are in my mind that would have been the biggest entrepreneurs don't have time to waste and a damn sure don't have time to sit there for an hour every Wednesday morning having breakfast while everybody's trying to sell me something that's just BS get into a group where we're all there to learn and grow and collaborate uh and share experience with one another that's probably the one thing if I were to go back to me at 24 25 years old I would tell myself to do at the time I felt like I didn't have the time to do it what I didn't account for is how much time I spent trying to figure out things on my own that I could have had a group of people that could have given me some advice or at least just their their experience up to that point and it would have saved me a lot of Agony so that that one hour you know a month or however often they would have met would have been a far better use of my time than me spending you know 30 40 hours trying to solve a problem that I could have chatted with someone in 15 minutes once a month you know something like that you're very relationship Centric as opposed to being transactional but you've negotiated and close some massive multi-million seven eight figure business deals throughout your career what is your best negotiation advice for people out there maybe they're struggling in those business meetings they're at the table with some Heavy Hitters they want to get really good at negotiating right and maybe let's say it's not going in their favor yeah and any negotiation advice for people out there that are still trying to you know have that win-win business to where it's more relationship and not transaction Centric right what's your best negotiation advice for people out there so there's been times where I've gotten into negotiations and uh especially if you're dealing with with some people in procurement that are just truly price driven they don't really care about anything else right you need to focus on the long-term wins right so rather than getting locked in that battle about the margins today or the price point of this today or whatever start let let them have that win okay but now start looking longterm right okay let's agree to do that but perhaps let's make it results driven right if I give you these results that's quantitative right we know exactly what I've been able to do to your bottom line right let's focus on on on on some piece of that coming back to us only after we've saved you the money only after we've delivered the results of your business or if by the way we we were able to successfully because of of the efficiencies that we brought brought to the table and drive down your cost you're able to grow your business right then maybe there's a percent every percentage that we grow your business so now it's directly related to your results we have a direct uh percentage increase on our price point right so allow me to earn my margins allow me to earn my money by making your business better now I'm eliminating the risk of you paying me more upfront today with with no guaranteed Roi right so in other words find another end round when you just get locked into these negotiations you're on you're on your back foot right and and you're losing those negotiations don't lose the deal find another way to think long term and the other thing it does it shows the customer that you're thinking longterm about this relationship not just on today's transaction okay that will give you the end of round to free everything up and now you've got a whole new path the freedom to negotiate a True Value results oriented pricing and margins that's now going to benefit you long term yes but you're going back to what I tell you I said I focus most on Mo uh first my customers results in their business so if I'm starting to demonstrate and focus on making you more successful you're happy as hell to pay me more on the backside right I've already delivered my results to you yeah leis this was absolutely phenomenal pleas thank you so much my friend for for everybody tuning in right now where can everybody find you on social media so uh actually as I've said effect effects Management Solutions is our main company that runs itself mostly today I'm not really that involved in the dayto day now I'm doing passion project which is we've started a YouTube channel and right now we're showcasing a lot of the cars and stuff of my car collection but really the point is to motivate and inspire people to do a lot of what we're talking about right here right it was a card that first inspired me the Kush I think we've got sit the sitting in the back back there but it started with that passion for cars that motivated me and to start striving for for levels of success in life I didn't even even know existed and so now I'm at a place where I really want to give back I love mentoring other people I'm hoping anytime I go to a car show it's there I want to meet a kid that asked me a question and I want them to ask me uh Hey how do you make that happen how do I get here what advice do you have for me I love mentoring others so uh uh the gentleman's garage we're on Instagram we're on YouTube We're on Tik Tok please check us out it's all yeah we're sharing cars having a lot of fun with that but the whole point of that is hopefully motivate and inspire people that if if I can grow up on a farm and on welfare and end up I don't know we're sitting here with a I don't know a $21 million car collection um you can too there's no there was nothing special about me as I talked about I I had a dream I had a vision for something that I wanted for myself and at the end of the day it's the number one thing I tell people all the time believe in yourself and just don't quit so check us out the gentleman's garage look forward to seeing you guys there and share more content everybody go follow louw right now and as I mentioned earlier guys we recently launched our official entrepreneur Community the school of mentors where you can learn directly come and get mentored by entrepreneurs just like Lewis who's built a $300 million company and every week I'm hosting live calls with the multi-millionaires and the billionaires I interview on this channel every single week to get access to this entire to get access to this entire exclusive interview go to the link down in the description of this video or go to the school of mentors to join today with that being said we'll see you guys in the next video