How do you know when your business is big enough? When can you stop raising capital? Can you get out of your building’s terrible lease terms?
Mike Melby is a venture capitalist who works exclusively in sports and fitness. He’s overseen the inception and growth of a lot of businesses, and on this week’s episode, he shares some of the common traps owners fall into.
As a functional fitness entrepreneur, you probably get a ton of unsolicited advice about how to grow your business. “You should get more investors!” “You shouldn’t franchise; you’ll only get a 5% royalty!” “Now that you have four gyms, you might as well open up a fifth!” And while it’s a good idea to listen to all the advice you get, it’s not a good idea to take all of it.
This week, Mike talks about how to know when your gym is the right size for you. Sure, getting investors means more money, but it might also mean having to report to someone when you’re used to being your own boss. Franchising royalties that sound like small potatoes can end up being big paychecks. And the difference between opening that fourth gym and opening that fifth gym might not mean 25% more work for your staff — depending on the scalability of your current model, that one location might bring 100% more work (and pain) for everyone involved.
Let’s say you know you’re ready to start approaching investors. Listen in for great advice on who to ask, how to ask them, and how to deal with the inevitable rejection. Plan to ask 100 or more people for money, and don’t take it personally when they reject you. In fact, don’t even look at it as rejection. Mike Melby has tips for getting through the pain of our own egos.
You know you want to grow. Listen to this episode for insight on the right way to do it for your brand, your business, and your life.
This week on Barbell Business, we interview Mike Melby to discuss:
- How to determine the right equity split for each of your gym’s partners
- When to scale up, and when to sit tight
- How to ask investors for money
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