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MEGAPARTNERINGEVENT
LosAngeles12/3/12
MC: Mister Jay Abraham!
Jay: That was very nice. Thank you. I appreciate it ‐ thanks.
So I got a bunch of I’ve got a bunch of disparate things to say but the first is‐ when I
describe myself to people I say, “I’m a marketing and a strategic savant.” I get that...
and everything else... I’m like a mad scientist.
I demonstrated it today when I was getting on the escalator; I had this little file of
papers that fell out of my hands on the steps and trying to bend over and get it... a
pen falls out, it goes further... I go to get that, fall over then I get to the bottom. Fell
over, cut my knee. It's just... it’s hilarious to be adroit at one thing and incompetent
in another but that’s a good metaphor for life.
Somebody said to me at the end of the century when Y2K came, the defining trait
characteristic of a profound monster: wildly profitable and well‐generated success is
people’s ability to creatively collaborate. This event, I think, defines that.
I want to do a couple things because I think I did a disservice to some of you
yesterday and I want to correct that, whether it manifests in any future relationship
or not, I've got to explain it. I'm going to be like Ike and Tina Turner doing Proud
Mary.
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By the way, metaphors are one of the … even if you're religious … and I’m not saying
it to make fun. You know whatever bible or equivalent that you adhere to ‐ it makes
its points by parables. The human brain, those of you who know NLP, NLC... the
mind relates more powerfully to metaphors and similes than it does anything else. I
use a lot of them, not to be trite, but because that penetrates the resistance levels.
I've been doing this... I mean I’m going to be 84... 64. I feel like 84 after I fell down.
Those of you who're 84, I’m not making fun. I admire and hope that my brain is as
vibrant as yours. I've been doing it since I was 20. I’ve have a great ability to see and
to perceive and immerse myself on the front‐lines of capitalism.
I've evolved or devolved to a point where I don’t really sell much of anything myself
anymore. In all modesty, I’m very good at writing copy and I understand keywords
that will drive people to run to the bank and give everyone their credit card, their
first born, their billing number, their key‐codes to their Swiss bank account but I
haven’t really done much of that.
I was talking to JT and I said, I got up this morning at about four and I made notes
“Maybe I should redenominate this very sophisticated esoteric concept of relational
capital, maximizing, monetizing and managing.” Because it's so abstract, that it
probably doesn't really resonate at the fullest capacity.
So I'm going to go back and revisit it from a little different frame of reference to try
and tell you why I have had the career I have had, and why most of it has been a
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derivative of understanding, and accessing, and levering, and harnessing, and
grasping all these intangibilities.
So, two good stories:
1. A guy that I knew that used to speak of my programs when I started in the early
80's... was a very multi‐million dollar best‐selling author. But when he started, he
was a one book selling author. He literally sold one book. The name of the book was
The Entrepreneurs Bible. It was boring conceptually ‐ it didn't do well. It was a great
book ... and then he just changed the name... he didn't change his copy; he just
changed the name of the book. Why Nice Guys Fail In Business and S.O.B.'s Succeed.
S.O.B's stood for, as an acronym for smart operating businesses. That change
produced multimillion dollar units.
2. I had another client that was into very sophisticated management training. Well
this guy wrote a book called The Enlightened Entrepreneur. It was trying to teach
entrepreneurs how to get their teams more productive, more collaborative and it
sold about four. Then they changed the name to How to Turn Managers Into
Leaders… and it sold 500,000 books.
I'm telling you that because I’m going to change the pace today and I’m going to re‐
articulate. So I said like Ike and Tina Turner doing Proud Mary... a little more
aggressive and ask some questions. You got all those documents I gave you and I
want to make sure you grasp it knowing that I’ve grown companies from zero to 14
million in a year. From a few hundred thousand to millions in months; from 300,000
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to year 2 billion in 2 years all using derivatives of this and I’ve been able to get half
control of businesses, get access to cash‐flow and create profit centers from scratch.
I don't think I did the majesty of the concept justice because very frankly I’m tired of
using my marketing acuity to sell the concept. I'm more interested in doing a
concept. I think I’ve allowed it to go esoteric because when I did that video that
they played I wasn't intent on selling anything. It was just my random verbiage,
articulation of a concept. I was trying to congeal so I could do transactional
business.
I don’t care if I sell you on signing up. I want to sell you on reading those documents
and thinking about it differently. I can’t imagine anyone who owns a business,
anybody who understands ROI, anybody who understands highest and best use of
their business; anybody who understands distress assets; anybody who understands
upside leverage with no downside risk ‐ wouldn't just be eager to get this.
If somebody doesn't grasp it ‐ a great lesson in marketing... isn’t it your fault? Unless
you have no IQ, and shouldn’t be in the room, and you should be under psychiatric
attention, then it's my fault for not expressing, communicating, denominating,
contrasting... and that's marketing lesson 101. So, I want to make sure at least the
whole majesty of what this is all about resonates. Because you got that stuff I gave
you and its powerful stuff ‐ very powerful.
So I’m going to ask some questions. How many people in this room own a business?
Any kind of business ‐ raise your hand.
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Keep your hand up if that business is going all the business you would like it to.
Put your hands back up, all of you who own a business. Keep your hand up if you
got all the sources of clients and profits you want...
Keep it up if you have all the capital you want to invest in that business...
Keep it up if you got more than one primary source of generating your business.
Two, three, four ... you guys are good. You guys are very good ‐ I like that … Okay put
them down [hands]…
Okay, how many people here are real estate investors that would put money up
tomorrow if you know you could get, worst case, 25% or more yield … totally safe,
on your money. What if you could get not only 25% but that was the bonus because
you were building assets that would grow in the five, six and seven figures for no
capital risk? Would that be interesting?
How many people ever invested in distress real estate? Okay, hands down.
How many people invested in distress real estate would love to have the upside on a
million dollar, ten million dollar, fifty million dollar, hundred million dollar asset play
if there was no downside from you. Okay. Put your hands down.
How many people here are serial entrepreneurs or on the precipice of becoming
one? How many of you either are at a place in your life where you're trying to find
the opportune new business or are looking to put other people in business and
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leverage it? Or would be eager to put people in business if the cost of doing it was
zero and the upside was six figures a person a year, residual, and your capital was
nothing.
I'm just not quite through yet; I want to try to redenominate this just a little bit for
you. I'm not trying to be funny; I'm just trying to show you why I get so excited but I
think I over‐intellectualized it yesterday and in the documents.
Does anyone here have a business that’s stuck and it could be a real estate business
or a commercial enterprise or professional practice? A lot of people don't even
know you're stuck because if you grow at ten or fifteen percent you may be happy
when in fact the capacity of the assets, the market, the opportunity when it could
be 110%, 220%.
Okay, how would you like to get equity in whatever bundle or bushel of businesses
you wanted at whatever pace you want it, and only have upside in it and the worst
you would have to do is service a very tiny, maybe a fraction of whatever minimum
wage was for an operative to manage them for you and it was like a ‘no‐brainer’?
You could have as many as you wanted, as often as you wanted, limited only by your
pace of aggressiveness and enterprise?
How many people here would love to own … not a franchise but be a franchisor
with no capital invested, no regulatory problems, no real big staff, with no legal
problems about class actions and only have the upside?
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Now you have to know, when I tell you these things; I used to run all the marketing
for Entrepreneur magazine.
Whose advertising works less effective than they want when you're advertising
business, your practice, or looking for deal flow for your real estate? How would you
like to have infinite access to advertising that you only pay for the leads that
emanated from it, that were qualified? Or, if you were a really good negotiator, you
only paid for the actual deals that close or if you're even more of a good negotiator
you would only pay from the cash‐flow that emanated from the deals that closed.
Are you starting to understand this from a little different point of view? It’s actually
educational because I’m going to do this one time. I don't care if you sign up or not.
If tomorrow morning , I wrote you a check for fifty grand, or a hundred grand, or a
million, which is ten, or twenty or a hundred... or ten million which is... whatever
JT's charging for that... Where ROI... how many of you could put that to work in
either your business or real estate?
How many of you would love... LOVE... to have access to not one but to a spectrum
of experts? If your business is sales, expert advertising, expert online … marketing,
expert effectiveness, expert transportation, expert IT and if you didn't have to pay
them except for when their expertise produced a measurable denominatable result
that either put money in your pocket or left money in your bank account that you
didn't have to spend ‐ anybody…?
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Are you getting this from a little different vantage point now?
I told my wife, “JT did well, but he said the people who get it already got it. He said
‘you really didn’t resonate’.” I care more because this is a concept that is driving
either directly or indirectly probably over half of the nine or ten or twelve billion
dollars of achievement that I have created. Even if you do nothing with it but stretch
your paradigm in one of those documents I gave you.
Let me give you an interesting concept. I live in a pretty nice house, about 8,000
square feet, it’s probably not as big as some, but bigger than others. My wife has a
supercharged Range Rover and a Porsche Convertible. I have a lot of art in my
house, 450‐600 pound statues. My whole backyard has beautiful tiling and things
that I would trade the equivalent of a day of my time for each. I declare a lowest
market value on my tax because you don’t want to not... do something appropriate.
But wouldn't it be nice to create currency at will? That you could pay for with either
a fraction of the dollars or if you were in a business and had something that cost
you 20% to produce... you could use that as currency and buy 100% expenses.
How many people here sell anything to anyone … high‐ticket or repetitive?
How many would like to shorten the buying cycle of attracting new people? Do you
realize the faster you get someone started if you have a repetitive product, the
faster they will buy the second time. If you don’t have a repetitive product, if you
understand what I’m trying to teach you, you will because you have a bonded
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relationship with the buyer who buys lots of other things in and outside that
category and they trust you. You spent a lot of time, effort, intellectual capital, and
money building the trust and credibility that produced the first sale.
How many didn’t get the fact that what I was talking about yesterday was getting
control of assets, goodwill, credibility, that may have taken a company five, ten,
fifteen years to create? They may have invested ‐ for a small company: a million
dollars a year in advertising, personnel, rent, equipment, and staff. Big company:
tens of millions and a bigger company with hundreds of millions. You could leverage
that for zero downside even if you only got three or four or five or six percent yield,
it would be pretty good wouldn't it? It’s a pretty interesting concept. If you look at it
from a different… third dimension paradigm.
How many people here don't want to have additional companies selling your stuff
for you on a performance basis where you only pay them either after the sale is
generated and the money's in your bank of you don’t pay them at all ‐ nobody
wants that?
I have in Russia, somebody who every month sells stuff and sends me money. I have
in Japan, somebody who sends me 20‐30 grand a month because they have a video
of a program that I did last time I was in Tokyo; they do about six million dollars and
I get three of it. While I'm talking to you, they're doing a seminar right now for 25
people who pay them whatever and I get a royalty on it.
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I used to be in the newsletter business. Anybody here ever subscribe to a newsletter
or an advisory service and then take the upgrades ‐ the 5000 dollar more esoteric
version? It’s the equivalent of those people sitting in the front row right here and
you do understand that don't you? You're the same thing. I created that for people
years ago. They had all this good will and net‐worth and they were selling 69 and 99
dollar newsletter and I said “Let’s see if we could sell 500 of them. Let’s see if we
could sell a $2500 VIP. Let’s see if we could sell super colossal, platinum, gold,
titanium all‐inclusive.
And not only did I do that, I didn't just do it with one. I would create the articulation
and the model but retain ownership of it so I could cut out the reference to their
specific capital basis and I could apply to it ten other people and do it over and over
again. While I’m talking to you; I have them going and letting me mine all their
goodwill and all of their assets base and all their expertise. I would get twenty,
thirty, forty percent of the profit. Doesn't that excite you guys?
When I met the man that taught me barter I was about 22. I was a very vertical and
linear thinker but this guy was masterful. He taught me a hundred new ways to
think differently.
There was a guy that had a big phone room and he was selling three to four
thousand dollar video training programs. I went to him, looked at the training
programs for business and said, “I like it but it’s not worth four grand to me. I'll sell
it for a thousand as a steeply discounted value to my market” but the real problem
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is ‐ this is in VHS. The content was profound, the video sucked. It was like watching
fingernails... you know scraping the chalkboard.
When the fingernails were done...doing it with their toenails. You like the
metaphor?
As I said I’m troubled because I’m trying to make a way of thinking. So I get control
… and this guy has sold, I don’t know, five thousand people. So I just say, I’m not
going to buy in to your reality. I'm going to tell you a great story in a minute that's
profoundly liberating. I got a market of the best entrepreneurs and I did this before
the invention of the internet. We had 40,000 people that spent $250,000,000 with
me and before I got tired of doing seminars. We weren't incompetent at doing
them.
I said, your model’s pretty good but I’m not going to sell it for $4,000‐ its not worth
it. I got him to let me do it for $1,000 and give him 10% of the profit, not of the
gross. But that wasn't the key thing... I'm still watching and it’s ongoing…
So thinking about with this nonlinear way of thinking... Man you've got to have
enormous discipline and perseverance to watch this thing. But the message is so
profound it’s probably worth it if you can muddle through it.
So I got an idea, I went to Nike O’Connor and said “Do you have any courses on
perseverance?” They said, “Yeah.” I said, “Tell you what, I want to buy it.” It was not
much, like a $100 retail and they sold to me for $14. I'm selling a $1000 program
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that somebody else probably spent five years creating... I get to offer it with a
context of, “I just saved you 75%”.
I was massively cool with liberal trials and everything else. And headlines
denominate everything… I did a terrible headline yesterday to you when I said,
“Maximizing and multiplying and managing relational capital” and you guys didn’t
get it. Today it's a little clearer isn't it?
So I wrote a headline that said, “These hideous videos could probably make you a
fortune ‐ ‐ if you can stand to watch them”. Then I told a story about the content
and this horrible video and I said here’s the deal, I want to challenge you. If you're
willing, if you're game, send me the money‐ the thousand bucks. I won’t even
deposit your credit card but what I will do is send you immediately the course with
an admonishment not to watch it ‐ yet. I'll give you a gift which is yours to keep it
anyway … it’s a $100 course on perseverance. If you can watch it and then watch
the first video, and if you can muddle through it ‐ you tell me. If it isn't and give it
back and you'll learn how to be more tolerant, more focused and more perseverant.
Help you in all your life issues including talking to boring people and arrogant
people and disrespectful people.
And we sold millions of dollars worth…
It’s a way of thinking and I’ve been blessed. Like the guy that taught me barter. He
was pretty smart. You know what the coolest thing to barter is ‐ cash. Now that
sounds weird doesn’t it? But when I got into the barter; I started learning about it in
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the radio business selling advertising and if you're a good negotiator you get 30% off
40% off.
There was a man named William B Tanner; who was one of the fathers of barter
and he started with a company that sold jingles. If you listen to radio stations ... “W‐
wave...” or whatever it is ‐ that’s the jingle. He wouldn't sell it. He would give
someone the jingle; everyone else would sell the jingle for two, three thousand
dollars... five thousand dollars.
He would give them the jingle and update it but he got one or two prime‐time spot
credits a day for as long as he uses the jingle. So, one or two prime‐time spot jingles
a day... typical station then was $60... times seven is $500 a week times fifty‐two is
$25,000 for something that the market was selling for $5000. Then he would sell it
to people for 60% off … that was pretty good right? So he's taken something that
market value's ‐ $5000. He's getting $25,000; he's selling it for $10,000 … pretty
interesting ‐ isn't it? He just doubled his money ‐ didn't he?
So that’s pretty good but he got a better idea. He went to stations and said, “tell you
what! I’ll give you the use of an American express card. All I want is 3:1 for every
dollar you spend at the lowest...” they call it best of nations... it’s like the very best
price they've ever charged and that's what I think political candidates get when they
buy. I think they got to give them the absolute lowest rate. If you bought it, maybe
rack rate... which is $100; maybe you're a good negotiator and you get it for 70.
Let's say they've sold it before in a package for $40; so he's not buying it for 40…
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he’s buying it for a third of 40. He says, “Use this American Express Card; all I want
you to do is give me credit for 3:1 that you could spend. What do you want to
spend, $20,000 a month? Okay! I get $60,000 but not $60,000 at a $100 ‐ $60,000
at 40. I'm trying to give you a way of thinking.
This is just a few of the cool ways to look at it differently. So I had as one of my
multiple jobs, it may have been in one of documents that you've read or didn't read
but it’s a pretty cool story. When I was young ‐ I did a lot of things. One of them was
I worked for a company called Holiday Magazine. It was a competitor to Town and
Country Travel. It was for travel oriented people. We were not number one or not
number two, we were number three and we were quarterly.
Now the problem with being number 3 and a quarterly is three things:
1. No one wants to buy your advertising.
2. If they buy it they negotiate like mad.
3. If they buy after they negotiate like mad; it's a quarterly so you don't get paid
until it comes out. And then when it gets paid because you're number three and
they don't care and they've negotiated like mad. You don't get paid for six
months … so it might take you nine months to get cash flow ‐ it's a crappy
business.
So when I get there, I've always been thrown in. No one ever gave me a salary. They
just said, “Okay kid find a way to make money, and you can have a piece of it.” So
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I'm looking at it... asking questions.. I uncover the fact that they're regularly offered
trades but they don't take them. I said, “Why aren’t they?” So they didn’t take them
because they don’t know what to do with them.
I'm going to give you two stories here ‐ very interesting both of them.
So what I did is go to five star hotels, the resorts and the airlines. I’d say we'd trade
you dollar for dollar ‐ rack to rack [rate]. We'll give you a ten thousand dollar ad. For
ten thousand dollars worth of Singapore Air or AA [American Airlines] or Swiss Air
and if they said yes … I’d say, “Okay, I’d just need to confirm it with management.
Before I would confirm it I would go out and get bids for 50‐60% of the value which
was not hard to sell for a five star resort.
I fly Singapore Air first class all the time and it cost like $20,000 for a first class ticket
to Singapore. If I gave it to you for $11,000 and you were going to go anywhere they
flew and you had never experienced it; it would probably be an easy sell. The deal
was we had to keep it off the market discreetly. So we did that all day long.
Now, what’s interesting about that? Well, let’s take a look it. We couldn't sell
advertising before and if we did we probably saw a $10,000 a page for like $2200
and then we would have to take nine months. You guys understand the time value
of money? Instead, I was trading dollar for dollar. I was pre‐selling it immediately for
cash on average of at sixty percent ‐ no less than fifty percent of value. We were
paying a thousand dollars; I was getting five to six times. I was getting paid not nine
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months later ‐ but instantly. Usually, two or three or four months before the
magazine happened.
I'm just trying to show you how to think differently ‐ that was pretty cool.
Another interesting dimension: this guy that taught me barter humbled me because
he did half a billion of trade. Whenever we had stuff we couldn't sell, which we did
sometimes, we'd call him and he would give a terrible offer. Most people would
never accept it except he would overnight a cashier’s check. “It’s okay just send it
back if you don't want it.” You know how hard it is to send back even an insulting
cashier’s check made out for the full amount?
I remember one time when I started ... we had like $500,000 worth of crap that they
had gotten before I started. He offered something terrible... $75,000… $35,000. He
said, “Okay, I don’t know if I can use it up but I’ll give you that … it’s what it’s worth
to me. I'm going to send you a check... just send it back.” I walked in to the owner
and said here’s a cashier’s check for thirty five, fifty... not a lot... he said, “It’s only
good.” He said send it back within 24 hours ‐ he said, “That’s fine.” You think it went
back?
My life has been very eventful. I've been involved in 465 industries in ways that are
very intriguing; but I was thinking about how I bought profit centers. I'll tell you a
fascinating story to derivative this, but it requires very critical thinking.
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So I’m going to discriminate people who are closer to my age, in their 50's or 60's
will relate to this. So I got started in the financial newsletter business before the
internet. I also had the history of being there when the first Xerox, cell phone and
other stuff that you young people know about. In the beginning, a newsletter was
physically sent out. Almost everybody paid for a subscription. So the quality of the
subscribers was incredibly higher, much more acute and valuable. The relationship
between that subscriber and the person writing the newsletter, which is normally
an individual who had brand currency, is very strong.
It was a very incestuous industry. I’m going to use a very vulgar word, they “whore”
one another. I’m mailing your offer, you're mailing my offer, it's sickening.
In the old days, everyone rented each other’s list but they did mailings. A mailing
costs, bulk rate, approximately 65c to rent a list, print the subscription offer, go to a
mailing house, you would load a bin, put the postage on bulk rate and send it out –
that was 65 cents. Most of the people back then were content at 65 cents to break
even.
It only cost about $6 a year to fulfill a two or three hundred dollar newsletter
because there were special provisions that may or not be any more for a
subscription based material that got expedited but got charged very low. So
everyone’s renting each other’s list and breaking even … either breaking even with
or without what's called “Imputed Market”. That’s the cost of printing it and
shipping it out.
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None of these people put anything in their newsletter. The reason they did because
they were linear thinkers. They all followed one another and the only thing they
knew was advertising – per se. Advertising, interpret it this way, was taking a 8.5x11
sheet, a typical piece of white paper and printing one side an ad and another side
blank. They would fold it three ways and stick it in their newsletter ‐ most of them
made very little.
They didn't see it as a big revenue stream. So I’m helping everybody, I was like the
kingpin of newsletters. I was doing the early renewal because they couldn’t figure it
out. I would take the same early renewal and use it twenty five places and make
millions of dollars on it. I was doing reactivation; no one thought about it and I did
that. I was doing upgrades. I came up with every different way to re‐purpose their
stuff when their mailing didn’t work anymore. I would get the rights to it and flip it
to investment firms. I'll give you a little quick installment and most newsletter
promoters would stop mailing when it would stop breaking even.
Anybody here in the investment market … big time? Where you get leads? Okay,
well in the lead generating business is totally negative cash‐flow. You might spend
$50, $100 and $200 to get a lead ‐ it might take you what … three to six months to
convert it. So I would buy the rights to mailing pieces that are worth … let’s say
selling ‐ a gold newsletter at profit. When they got to be a little break even ‐ the
newsletters would stop using it. I would take the mailing pieces; I’d buy them for
maybe $1000 and 3c of mailing. I would re‐purpose them because they were
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normally tied to a bonus like a great report on gold or petty stocks or a great report
on gold stocks, or a great report on forecasting the future. I'd get the report and the
mailing piece, that somebody already at $50,000 to a copy writer to do it and it
already sold millions of dollars. I would re‐purpose it as a lead generator and I'd get
maybe five or ten grand up front ‐ nine of which was mine. I'd get five to ten cents a
mailing against whatever was legal a piece of the sales … but it's a way of thinking...
Back to the newsletter business…
So the newsletter business is all these people incestuously renting one another’s
lists and they're breaking even. No one’s doing anything with the brand currency
they have internally with all subscribers. I'm thinking what would happen if I took
the same mailing piece that people are paying 65 cents for and I bought the rights
to stick it inside somebody else’s newsletter. First of all, I wanted to see what it
would cost ‐ it cost about 5 cents. Okay, if they break even at 65 cents and I can get
the same impact for 5 cents, seems like I’m going to make 60 cents on every one
that I print. But then I realized there was an accelerator, an enhancer and a very
interesting positive exacerbating this factor. That is whether the newsletter would
endorse it or not, the fact it’s coming in your newsletter has the implication of
endorsement which is an enhancer.
I started to think, what’s wrong with it...? I couldn't figure it out.
So when I bought the rights to everybody’s newsletter … I didn’t know what to pay
them. Either I bought it for a guarantee; by the way I had no money then. I figured if
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I go broke ‐ does it matter? I had no assets. I had bought a house but I had about
$12,000 worth of equity in it ‐ it didn’t really matter.
So I bought the rights to like ten newsletters to do it. Some of them I gave
percentages. And I didn't know it worked. The first time I did it I made $500,000
over two weekends. I remember the hilariousness. I had this little, really cool funky
house overlooking the ocean. It was a little beach house ‐ a two bedroom. I get a
knock at the door and it’s a post and it had five canvas sacs this tall, all full of
envelopes with $500 checks in it. The ability to look at a situation from different
vantage points … the analogy that I was taught was the world is a 3d movie, and you
got the only pair of glasses.
I'm going to tell one more story and I hope this is intriguing to you.
The story I’m going to tell is a real story that really happened to me. It shifted my
whole paradigm back in the late 80's. Hopefully it will have some value ‐ some
reflective haunting positive impact.
In approximately 89' in December, my father unexpectedly died in Indianapolis. It
was very sad and we were very heartfelt. I had to get everybody home... and it’s
miserable weather in Indianapolis. I think I had six people that I was taking back. We
get to the airport and the weather was horribly inclement. Any of you guys from
Chicago? I’m from Indianapolis ‐ it can be very brutal ... 41 degrees below, wind chill
can be disparate or rather horrid snow.
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Whatever airline we we're on, very graciously put us on another flight that wasn't
theirs and bought us the tickets. Which they didn't have to; we had a bereavement
rate anyhow which was low and I was very gracious.
We get to the other airline and there are a lot of people that they tried to do that
with. Understandably, we had six separate seats.. all separate. Now, that wouldn't
be a problem except I had a child six months old… I had a child about a year and
whatever. Enough time to have sex and gestate. So I don’t know … what would that
be...? Ten months, twelve months and a couple others ‐ I got a lot of kids.
The first seat we had, which is what they normally withhold is the bulkhead on the
aisle because they usually do it for invalids or personalities or things like that … you
know ‐ celebrities. So first I sit … the bulkhead in aisle one. My wife very graciously,
beautiful woman, great smile, asked the man sitting next on the bulkhead middle.
She said, “This is very awkward, but we had a flight going back to Indianapolis...”
and she tells this story, “...to a funeral, we got seats not together. Would you be
willing to trade with us so that I could sit here with our six month old son?” The guy
goes, “Absolutely not, I reserved this three months ahead. I always sit in the
bulkhead ‐ no way”.
I was telling you that this shirt used to fit when I had a 44 inch chest and I had 19
inch arms and I had a much more acute temper. So, I’m behind my wife and this
guy's being a real ass. She started smiling and laughing, I wanted to grab him with
one of my 19 inch arms and stick his head down his anus. My wife is just laughing
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her head off. She said one more time, “Are you sure and I’m not trying to be
disrespectful.” He said, “No way!” “Okay it's not a problem sir; thanks for at least
considering it.” She commenced to put up the baby’s car‐seat... (again listen to this
story, it's pretty profound) in the seat and she put the baby in the seat and I tied
him up. She looked to the man and said, “If he cries a little, give him this and you
can have the bottle. If he cries a lot you might want to do this.” She gave him wipes
and diapers and she left. I realized at that moment … it really wasn't our problem ‐ it
was his. Very understandably the man relinquished his seat. She did that all the way
through and we all sat together.
The point I’m making is that I what I try to figure out is who else has a problem
they've never verbalized... They've already spent the time, the effort ‐ the cost into
it … so that when you show them the benefit to them ‐ you can get control. I've
done things like this all my life and the many stories and I’m not trying to belittle
you guys … I spent four of five grand printing these out documents. I wanted to
really to try and give you a context. I was too esoteric. I had him rebroadcast the
videos because I wanted to give you a context of the power.
I’m doing a derivative of this in Japan and I explained it to them and they re‐
explained it and they already sold like four. I can’t imagine anyone in business,
anyone who understands financial leverage with upside and no downside. Anyone
who understands ROI … anyone who understand a balance sheet and what’s not on
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it. Not just getting salivating over trying to get their mind around the power and the
possibilities in this and that’s the only thing I’ll say to you guys.
JT: So Jay, why do most businesses fail in today’s market?
Jay: Well the first one, if you have nothing ... I mean you don't have to protect yourself
in a lawsuit from the rest of the market ‐ number one. Number two; you don't know
how to move fixed cost to variable. Number three; you don't know how to market.
Number four; you don't have a good strategy. Number five; you got a limited
business sourcing model. You want me to go on…?
JT: No, we're good. Alright, you've worked with several successful companies in the
past year. Some are achieving great success. When you look back at what you did
and what are they doing now that’s really working? Like if you attribute their
success to one thing, which is why they've really exploded their business in 2012.
Jay: I'm doing a book with one of the guys from Shark Tank about how to raise money.
What to do if you can’t because most people can’t.
I was with the guy, if everybody's ever watched Shark Tank ‐ the bald‐headed guy.
Very cool guy. His attitude is he doesn't care if you're nice or not, as long as you
make him money. I'm going to give you the polar opposite. The companies that I've
helped who transcend their industry have two really cool things in common.
One is that they’re preeminent. They’re seen as the most trusted adviser … the
benefactor. The creator of true value that is recognized appreciated and desired
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only from them by the market. Number two is … they are the ones that engineer
the maximum quantity … quality and consistency of breakthroughs. First and
foremost through marketing ‐ second in strategy, third in innovation, fourth in
management. Innovation and management are a little bit tricky … third in
innovation and fourth in management.
Innovation and management are a little bit tricky because innovation doesn't
necessarily mean technology. It means bringing greater value perception to the
market ‐ that the market desires you. You may have the greatest cost of product but
if you price it the same to the market; you don't use the differential in profit to add
more value you gave no benefit to the market. Managing doesn't necessarily mean
managing the people. Managing opportunity cost, managing your market place,
access, managing your brand currency...
JT: If you had to do it all over, knowing everything you know. Knowing the fact you've
been in over 400 industries and creating over 9 billion dollars of wealth for all these
entrepreneurs. If Jay Abraham had to do it all over again; what would he do ‐ in 30
seconds…?
Jay: This is going to sound a little bit awkward but I probably wouldn't be known to
anybody. Except I'd probably help young entrepreneur's understand the meaning of
business life. I'd probably just be operating discreetly behind the scenes. When I
started, I was making an enormous amount of money being the catalytic strategist
and the mastermind … an ethical puppet master... I got into the training biz.
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I like assets now, almost all my time is with operating businesses where I get a piece
of the cash‐flow. Either I have an option on equity, or equity if I create a new profit
center, product or service model channels. It's assets that it generate cash flow but
is convertible. I would create wealth because wealth creation gives you the luxury
and the freedom to do all the other stuff. And I would just do it ‐ backwards. The
key to everything is getting vehicles and assets that work harder and harder for you;
so that you don't have to work as hard for them and you can keep leveraging up.
JT: Okay, what is Jay Abraham’s in one word … your greatest strength and greatest
weakness as an entrepreneur?
Jay: Strength is simple; I mean everyone thinks of me as a marketing person. I'm
probably exceptionally good but I would always tell you that I'm a better strategist. I
understand strategy from so many vantage points: business modeling, re‐modeling,
resistance points, intangible and tangible things. I can’t manage. I don’t turn my
computer on ‐ I’m a technophobe. I have a big problem; I have to be a catalyst that
works off of other companies that have assets, critical mass, velocity and
momentum in play.
Somebody interviewed me once and said, ”What’s your management secret?” Well
my management secret is ‐ I don’t manage. I have like three people because I can't
pay attention to it. I always find a company that’s got 500 people or a thousand
people and has tremendous pressure on cash‐flow and payroll. They need an extra 5
or 10 or 20 million dollars
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So I mastermind it. My risk is just... if I don’t get a fee up front... my risk is just
opportunity cost and I get a piece of the cashflow forever and ever and ever. But
yeah ‐ I'm a terrible manager.
JT: What is JT Fox's greatest strength and JT Fox's greater strength?
Jay: Selling ties…
JT: What is my greatest strength and in your opinion as an entrepreneur what is my
greatest weakness?
Jay: Let me tell you something; he's so masterful he's going to use this on his website.
He's actually a profoundly astute... when I first met him I said young man. Then I
started calling him ‐ just a very astute man. He understands a lot more for his years
[experience]. He’s got an incredible context of understanding of a lot of stuff. Even
stuff he hasn't done and his weakness ‐ which he’s improved a lot.
I beat him up all the time to be more user‐friendly and more collaboratively
sensitive to the other side. Everybody who’s ever seen me... I was a young arrogant
person. I was extremely brighter than my level of social maturity. When you get
them both in alignment... the greatest thing you get when you're older... is you get
wisdom as a byproduct … humility and a sense of humanity. That doesn't mean you
demean your own relevance.
I’ve got two sons –that live in Australia. One lives in Sydney; one lives in Melbourne.
I want to go visit them around the time of the Australian Open. Unlike JT, I don’t
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want to pay for it. I want to be paid for it. So I’m trying to find somebody that’s got a
database who wants to do an intimate swap … you know … so I can be paid two,
three, four hundred grand to go see my kids.
So this guy that I know who’s very respected goes, “Call this guy” and they’ve got
these huge business promoters and I was there and so I called the guy and they
don’t know me and they go, “Well, we don’t know if your stuff will be qualitative
enough (I won’t name the names) ‐ a bunch of internet marketers”. And I said,
“Well, I think it'll probably be qualitative enough.” “How about I send you some
stuff?” “You want to place on our podium?” “I don’t think that’s really what I'm
asking about.”
But he's saying this: it's very hard in this business because the consumers don't
know how to discriminate. And the good news about the internet to me is you're
getting a consumer more and more discriminated. It used to be that all they had to
do was put a bunch of hyperbolic bullets and superficial copy. The biggest problem
with marketing‐ is no one takes the time to appreciate, respect, acknowledge and
understand what it's like to be in the shoes of a client because most of the people
selling stuff have never really done it.
JT: My greatest influence in my life has been Jay. Not only now that he's my coach but
he's a very good friend. You know ‐ he cares about me. He refers me as his doctor.
He calls me to make sure I take my vitamins. He's a nice man. Everything comes
from the heart. It’s nice to be around a genius. He and I have some of the most
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stimulating conversation. I say something, and he says, “Let me see if I can make it
better than the way you have been doing it.” That’s really every time and it forces
me to come up with great stuff.
When I bought my suite at the staple center ‐ I brought a lot of people to see it. I
had no friends before I had the suite and then I got a suite for the Lakers then
everyone became my friend. If it haven't been for that suite I never would have met
Jay Abraham and built a relationship. So it was worth $250,000.
So, if you can please stand up and honor one of the greatest marketing strategic
minds – ever … Jay Abraham everyone…
Jay: Thank you very much. Okay, it’s been great. Thank you ‐ I’ll see you ‐ bye.