The 3 things holding your business back - and how to fix them

Originally sent exclusively to The Letter subscribers on September 9. Want to be the first to get my personal newsletter in your inbox every Monday at 7am? Subscribe for free here.

Hey gang,

There are really only three reasons you’re not getting to where you want to be with your business. 

These are constraints that hold you back. But there are a few companies that have overcome them.

When they do, in many cases, they rule the world. 

Literally, these companies can influence government policy. 

It’s devilishly difficult to overcome these constraints, yet we can overcome them when we understand what they are.

An alcoholic can only really get help when they know they need it. Becoming aware is the path to improvement. 

Before we discuss the constraints, let’s turn to a fantastic quote that we all must embrace: “Success leaves clues.” 

While I’m here to flutter through my thoughts and share them with you, we must all put some serious effort into sharpening our saws before we cut some trees down (shudder at the thought - I love trees. Hopefully, you get the analogy). 

“Effective” is one of my favourite words to describe great people and organisations. It’s good to ask ourselves how “effective” we think we are right now. 

It’s a beautiful question.

I’m constantly reading and listening to books, articles, videos, and podcasts that tell the tales of the effective greats. 

I’m like a Sherlock Holmes tribute act—hunting for secrets of success so that I can swipe and deploy the formulas into my mystery and crack the case of success.

I’ll pile in countless hours every week.

It’s my Game of Thrones or Stranger Things. I’m absolutely addicted to it. 

I’ll gobble up anything about Microsoft, Costco, Virgin, Disney, Amazon, or Apple — frankly, any success stories of companies and individuals. 

Ask any of my team, and you’ll quickly know that I have been fascinated by the business model of “Taylor Swift” over the last year—verging on obsessive. 

She’s remarkable. I’m a self-confessed “Swifty”—not so much for the music, but for the brain of the woman. 

Any effective individual should be studied.

They all have a hunger for drive and determination - plus, as my research shows, resilience, self-improvement, and an unwavering desire to win.

I’m intrigued by how these household names have become blockbusters of our everyday life in just a few decades. 

How do these companies build revenues exceeding those of some countries? It’s madness.

Here’s a fact for you: Microsoft, who you may have heard of, clocked up £245 billion in revenue for 2024. What’s mind-boggling is that they made £88 billion in profit.

That’s nearly £1.7 billion a week—profit, not revenue (that’s £241 million profit a day). 

Tay Tay took on Apple and Spotify in the streaming wars and won.

Let’s pause to quantify that: Taylor Swift got Apple to change how they do business with streamers on their platform to stack the deal in her favour. 

Now, back to the brainchild of a certain Bill Gates. 

Microsoft makes serious money, but their revenues are behind Costco by a few billion. That said, Microsoft trumps Costco on profits. The saying goes, “Turnover is vanity, but profit is sanity.” 

That said, Costco still clocks in billions of profit year in, year out, with ever-growing like-for-like sales and profit growth.

To anyone in business, that is admirable to the highest order. 

Companies say they grow, but usually because of investment, acquisition, or the creation of new revenue streams by expanding into new territories, etc.

I’m always amazed by just how big and how impressive the Costco business model is—five times bigger than Nike, three times bigger than Disney. 

I made a video about them.

The absolute crazy discovery is the symbiotic traits that leaders and greats have in common. 

We have discussed in this newsletter and in my content that “rare and protected forms of leverage” are how you win this game of entrepreneurship.

We’ve also discussed that once you know what they are, you can seek them out—like a map leading to treasure.

Half the job is knowing where the treasure is. 

Let’s turn now to the constraints that hold a business back: 

 1. Constraints on Capital

 2. Constraints on Talent

 3. Constraints on the Captain’s Ability 

1. Capital

If you don’t have enough capital to get where you want to go, you’ll be constrained. Obviously. The greats are masters of just acquiring capital—relentless, in fact. The answer to them is “yes”, no matter how many doors need to be knocked on. They gallop over this like a well-seasoned racehorse. The world is full of money. Smart entrepreneurs know how to get it and how to attract it.

2. Talent

Talent can explode a business, and I know this to be true. E + M = S is real (entrepreneurship plus management equals success). You need entrepreneurship and management to win - one cannot live in super success without the other. Study any great for long enough, and you’ll see there’s management behind the talent.

I wrote about Microsoft earlier. They have no constraints on capital—they literally have billions and billions. What has always stopped them from achieving even more domination is the lack of talent. They have so many opportunities to use their capital with, but they lack the brains and talent to deploy the huge capital they have at their disposal.

3. Captain (that’s you, by the way) 

Talent and capital are attracted to effective leadership, AKA “Captains”. Banks want to lend money to effective companies and talented entrepreneurs and business owners—Captains. 

People who excel want to work for people and companies that excel. 

That’s why the better you become, the better your skills are, the higher your company’s chance of success. 

Bill Gates really is super smart. Taylor Swift has truly put in her 10,000 hours of practice in songwriting. Jeff Bezos wasn’t just top of his class for intelligence - he was top of his state! 

Then again, Bill Gates has dyslexia and, quite clearly, most of us aren’t perfect. 

What makes these greats so amazing is how these people leverage their connections and abilities more than most. I’ve worked in entertainment for a long time and met some seriously talented people. Seriously. They’re nowhere near where they’d hoped to be.

Tay Tay got herself into the right places. So did Bill. So did Jeff.

“But what about their upbringing?”

Many say the greats, like Bill Gates, Richard Branson, Taylor Swift, and Jeff Bezos, had wealthy parents and that’s why they’ve achieved what they have—they got serious help. 

To every cohort of jealousy, I say this: I know numerous examples that suggest this can actually be more of a hinderance than a help. 

Here’s a brief summary of a powerful conversation I had five years ago.

I was doing business with a guy called Mike, a commercial estate agent. We were shooting the breeze about a very rich person in Essex who inherited 100 houses from his father when he was young. 

This individual has turned this into an empire with billions in value. 

I remember saying: “Well, inheriting 100 houses can really help you get started.” 

He then changed my mind for good. Mike said: “James, a lot of people inherit every day, and most lose it within five years.” 

Mike was absolutely right. The money goes to people who are not effective and don’t know how to manage wealth. 

That is why, my friends, most wealth is built in a generation, and only 10% gets to the fourth generation. I suppose that’s good news for us.

A Little Extra: Copywriting

A skill that I think will serve you well to brush up on is copywriting. Writing can make you very effective. 

You’ll be better at public speaking, conveying your message, clearing your head, and you’ll become an amazing marketer.

I’d go as far as saying all marketing starts with understanding the power of words.

I learnt this brilliant skill from a guy called Mark Creaser.

He’s still a close friend, and I think he is the master of masters with words.

We worked together for a number of years. Mark was the brainchild behind my YouTube channel he pushed me to start 7 years ago. 

Look him up if you want a hand with marketing. I’ve always found that a conversation with him provides a different perspective. 

I’m in Lake Combover as I pen this note for you. (I jest about the name - I’m becoming a crafty comber as the years gallop past me, working hard to avoid a trip to Turkey) 

It’s quite the place. The Italians are just wonderful. I love how they speak with their hands. 

I’ve got a hectic last quarter ahead of me at work, so I wanted to bag one last weekend treat for my Mrs S and I, as we close off 2024.

If you’ve got little ones, book in some regular time for just the two of you—especially if you’re a business owner. 

I find business owners who have a strong, happy home life are very effective at work.

We love our kids but we also like each other a lot more when we make time for us.

It’s important: very important. 

That said, I had an absolute Barney with my wife while we were away. She keeps saying I’m nosey. 

Well, she hasn’t told me I’m nosey - I read it in her diary.

I hope you’re the captain of your industry - and if you’re not, you’re working out how to be.

Once you are, you’ll attract capital and talent. 

You’ll never have to worry about constraints again. 

To your continued success,