99 Jobs Gone: The Company Had Sales but Not Cash
A general contracting firm's Chapter 11 filing converted to Chapter 7 in open court — 99 employees out, and the books had looked fine. Pam Jordan was there as legal counsel, and it's the moment that shaped everything she does now. Jerremy Alexander Newsome and Dave Conley get into her core argument: it's not what you make, it's what you keep — companies can hit eight figures and still be broke without profit. She walks through her fractional-CFO process of reviewing books, financials, and tax returns to find root causes behind cashflow complaints, and says pricing errors are now the most common first problem. Her pricing framework stacks target profit, debt obligations, overhead, and direct costs in sequence. W2 workers also overpay taxes, she says — most skip LLC structures and education savings vehicles they already qualify to use.
Timestamps:
- (00:00) 99 jobs, one court date – when strong sales still couldn't cover cash
- (00:29) Meet Pam Jordan – fractional CFO who watched the collapse firsthand
- (00:54) Chapter 11 to Chapter 7 – the collapse that ended 99 careers in open court
- (03:33) Keep, not make – why revenue is the wrong number to celebrate
- (04:29) Find the real pain – books, taxes, where cashflow problems actually hide
- (08:28) Pricing formula – target profit, debt, overhead, direct costs stacked in order
- (11:14) W2 tax leaks – the LLC strategy most employees never hear about
- (13:53) Money lies from childhood – beliefs formed before age 7 still cap income
- (16:55) The flexibility gap – skilled moms, rigid schedules, output left on the table
Pam Jordan – Website | Instagram | Facebook | YouTube | LinkedIn
Transcript
The old American deal said, work hard, stay loyal,
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:and the system will hold up.
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:Its end of the bargain, but it did not.
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:And the people feeling at the
hardest right now aren't just
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:the ones who got left out.
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:They're the ones who did everything
right and still ended up.
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:Exposed Pam Jordan watched that
happen to her own mentor and spent
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:the last 20 years making sure it
did not happen to the entrepreneurs
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:who decided to build their own deal.
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:Instead.
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:My name is Jerremy Alexander Newsom
with my co-host Dave DC Conley, and
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:this is solving America's Problems.
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:Pam built Pivot business
group around one idea.
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:It's not about what you make,
it's about what you keep.
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:She works with business owners navigating
a chaotic economy, and she's here today
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:to talk about the financial moves most
people aren't making and what the new deal
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:actually needs to look like for to work.
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:Ms.
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:Pam Jordan, welcome to the show.
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:Pam Jordan: Thanks, Jerremy.
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:I'm so pumped to be here.
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:Jerremy Newsome: Yeah,
it's gonna be so awesome.
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:It's gonna be incredible.
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:So, Pam, you were inside a general
contracting company when it went bankrupt.
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:Take us back to the moment,
the exact moment if you can.
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:When you realized it was going down,
what was happening to the people
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:around you and what did you, what
did you decide to do differently
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:because it was actually happening?
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:Pam Jordan: Yeah, absolutely.
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:So, anyone who's walked through that,
like a business closing down and seeing
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:someone's dream fall apart, it's a
very physical, emotional experience.
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:So I can tell you
exactly how it felt like.
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:I mean, I, it was like a, it was
like you got run over by a truck
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:and there's about two years of my
life that are kind of grayed out.
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:Like, I look at pictures and I was like,
oh, I forgot we did that, you know?
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:but really for me, it was when
we were in the courtroom and we
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:had filed chapter 11, for the
business and it was a restructuring,
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:so we were trying to save it.
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:99 employees, all that.
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:And ultimately the bank came in
and said, you tried really hard,
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:but it's just not good enough, fast
enough, and we're pulling the plug,
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:so we're converting you to a seven.
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:And I'm sitting there,
the owner's not there.
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:he physically wasn't able
to handle this season.
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:so I'm in the court
representing the company.
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:It's not my company and the judge
and both lawyers look at me and
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:apologize and say, we know you tried.
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:And then I have to walk out with no
job and tell you guys like, this is it.
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:And so that's when I realized how
important it is to understand the
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:finances of your business and how much
cash is required because we had sales.
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:But we didn't have cash and there
was multiple, you know, and it's,
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:it's one of those things where you
can take one hit, but four big hits
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:in a row and it's just too much.
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:so that's where I learned what a
fractional CFO was and decided, hey,
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:that's something that could really help
the small business, the founder, the
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:entrepreneur, understand their numbers so
they wouldn't get in this trouble again.
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:And so that was, 10
years, nine, 10 years ago.
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:And I've built Pivot
Business Group from that.
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:Jerremy Newsome: Yes.
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:You built it outta that fire.
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:Right?
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:Which is super cool.
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:Again, taking what?
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:What is it?
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:What's it called?
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:Necessity is the mother of all invention.
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:Pam Jordan: Absolutely.
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:Jerremy Newsome: What's the one financial
truth that that collapsed, forced you
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:to confront about yourself and about
the company that you ended up building?
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:Pam Jordan: Yeah.
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:The, the financial
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:Jerremy Newsome: I.
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:Pam Jordan: really is, and you
said it in the intro, it's not
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:what you make that matters.
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:It's what you keep.
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:you can be a multi seven eight figure
business and have no profit and you're
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:broke and you're out of business.
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:And so far too often talk to entrepreneurs
who think they're very successful, but
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:then when you look under the hood and part
of our process is looking under the hood,
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:once we see what's going on, kind of a,
a hard conversation to be like, yes, you
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:have sales, but you're not profitable.
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:You don't have a sustainable
business model with this cash.
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:Jerremy Newsome: Gotcha.
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:Yeah.
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:Well, I tell people all the
time, and I'm glad to hear you
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:say it even in a different way.
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:There's a ginormous distinction between
the energy of making money, which most
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:people understand, and then keeping it.
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:Those are just two totally
different energies.
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:And the, the internal awareness of knowing
how, knowing when, knowing why I think
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:is extremely crucial for any business.
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:so on the side of CFOs then, 'cause
you used the word fractional, CFO,
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:most CFOs advise from a safe distance.
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:And since you've been on the wrong
side of a collapsing business, when a
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:client comes to you with a company that
looks fine from the outside, what's
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:the first thing that you check under
the hood that they've been pretending?
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:Isn't there?
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:Pam Jordan: Yeah, absolutely.
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:And what's funny is a lot of
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:Jerremy Newsome: I,
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:Pam Jordan: entrepreneurs come to
us because of a pain point, right?
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:That you don't
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:Jerremy Newsome: yeah.
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:Yeah.
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:Pam Jordan: CFO and a bookkeeper and
tax strategist 'cause things are great.
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:You come to us 'cause
it's a dumpster fire.
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:Like just being really clear.
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:Jerremy Newsome: Yep.
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:Pam Jordan: and so with the problem.
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:That I found early on is what the
entrepreneur is saying is really a
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:pain point and not the actual problem.
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:Right?
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:So they're saying I can't
make payroll, but really the
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:problem is, is their pricing.
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:And so when I first started, I was just
believing them and just trying to fix the
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:problem that they told me was the problem,
and I pretty quickly realized they
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:don't know what the actual problem is.
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:So I've created a process, a
proven process that we take our
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:clients through that quickly
identifies what's actually wrong.
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:So when a client comes to me and
says, Pam, my cashflow is a mess.
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:Like I just, I'm so stressed about
payroll all the time, I'm like.
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:I understand.
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:That's gotta be really hard.
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:We've helped clients with that.
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:Let me see your books.
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:Let me see your financials.
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:Let me see your tax returns.
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:We run it through, we have
an analysis that we do.
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:We do, validity score, a financial
analysis score, a tax strategy
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:score, like we rate their books and
their tax returns and everything.
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:And they have a very tangible
aha moment of like, oh, well, I
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:thought it was just cash flow.
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:I had no idea that this was the
problem and this was the problem.
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:And we're like, yes.
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:And we would love to help you.
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:Here's how we can do that.
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:so the problem is a lot of times
the entrepreneur gets confused about
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:the pain that they're feeling is
the result of the actual problem.
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:And the actual problem is what we
have to roll up our sleeves as.
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:You know, finance, business strategist
and figure out what's really causing this.
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:Like, is your marketing just awful?
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:Is your sales team trash?
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:Like, do you just not manage money well?
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:Like, is your pricing awful?
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:Do you have a really
overinflated overhead?
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:Like there's a lot that
could be wrong in a business.
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:And until you look under the
hood, you don't know which
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:one of those things is wrong.
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:And sometimes a lot of those things are
wrong, and we've just gotta pick the
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:first one and start and fix it first.
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:Jerremy Newsome: Do you ever find
which one, like you pick first, like
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:that, that's just most often incorrect?
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:Usually.
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:I mean, is it pricing or is like expenses?
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:Probably both of those somehow
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:Pam Jordan: is, it's funny.
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:Pricing has come up more in the
last 12 months than it has in prior
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:Jerremy Newsome: Really?
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:Pam Jordan: and it really
comes down in prior years.
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:It was more expenses like
overhead was inflated.
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:so we were fixing overhead a lot and
trying to tighten up payroll, but in the
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:last 12 months, it's really been pricing.
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:And what it is that I've found
is entrepreneurs don't understand
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:their direct costs well enough.
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:So they're selling a product or service
and they don't understand that all
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:their costs compile to a big number
and they need to charge more than that.
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:And so no one's charging the right amount.
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:So the first thing.
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:For a lot of our clients
is their pricing is wrong.
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:'cause once we look at their
fulfillment costs and what their
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:overhead is, we're like, dude, you
can go get a job and make more money.
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:Why are you running a business
with 30 people right now?
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:Like a salary?
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:W2 would.
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:Take, you'd be able to take home more.
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:Like, do you wanna fix this or do you
just wanna close it down and go get a job?
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:And as soon as you increase the pricing,
then there's more cash flow coming in.
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:Stress is relieved.
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:People are sleeping better.
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:Payroll's not such a nightmare.
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:And then we can fix other things.
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:But surprisingly, pricing has
been the typically nine times
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:outta 10, the first problem.
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:Most of our clients.
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:Jerremy Newsome: Now, what's
your general, I mean, I get
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:this a lot from entrepreneurs.
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:Like what's your general, if you have
one, either formula or recommendation
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:for how someone sets pricing?
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:'cause I, I agree with you Totally.
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:I think generally it's
like a, I don't know.
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:Let's see.
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:If people buy it for this amount and they
just kind of start, is there a formula
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:that you use or you suggest at all?
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:Pam Jordan: Absolutely.
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:Yeah.
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:Jerremy Newsome: Okay.
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:Pam Jordan: we have a whole framework that
we take our clients through, and it's.
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:It's not just like take your, take it and
mark type, you know, multiply it by three.
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:What we start with is
what profit do you want?
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:So we flip the switch
and say, what profit?
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:What do you want your profitability
to be on this product or service?
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:And depending on what your sell,
it might be 7% or it might be 35%.
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:We need to, it depends.
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:So we figure out what you
want your net profit to be.
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:And part of that is, this is a
little accountant E, but like
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:you need to make sure that you're
covering your debt obligation.
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:So you need to include,
make sure that includes the
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:principal portion of your debt.
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:So you can't just say, oh,
I wanna make 10% profit.
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:But then you've gotta be, you've got a
SBA loan that takes $5,000 a month, right?
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:So we need to calculate exactly
what your true profit needs to be.
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:we look at your direct costs.
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:Then we look at your overhead as a
percentage, and that gives you the price.
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:So it's not guessing.
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:and we have a whole formula that we.
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:and a whole tool that we have where it's
like, look, what is your target profit?
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:What is your overhead percentage
as a percentage of income?
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:or if you don't know that, like what
are your, what's your average burn rate?
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:What are your direct
cost to fulfill on this?
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:And it tells you what your cost has
to be to make that level of margin.
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:And then a lot of times PE clients are
like, oh, I could never sell it for that.
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:I was like, okay, well you're not making
money now, so do you wanna try like.
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:Dave: ha, ha, ha,
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:Jerremy Newsome: You wanna
wanna take a stab at the dark?
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:At profits maybe, or, yeah.
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:Pam Jordan: and so then it's like, okay,
well we can reduce your profitability so
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:we can cover your debt, but you're not
gonna take home any additional money.
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:Are you okay with that?
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:then we can charge your client less, and
they're like, no, I wanna make money.
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:I'm like, okay, well
then this is the cost.
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:Like the tool is it's, it's just math.
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:Unfortunately.
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:People put so much emotion into money,
and there's money mindset, and there's
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:money trauma, and there's money shame,
and it all boils into, I can't charge
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:that much for my services or my product.
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:No one will pay that.
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:Well, it's just math.
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:If you need to make this much profit, it
makes this much percentage of overhead.
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:Your direct costs are this.
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:have to charge this for your project
service to make those numbers.
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:Math like one plus one has to equal two
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:Jerremy Newsome: Mm-hmm.
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:Dang.
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:That's good.
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:All right.
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:Well, I got, I gotta put a pin in the
emotional components of money we got.
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:I mean, you know, you know, we
gotta go back to that at some point.
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:It's my favorite thing ever to talk about.
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:but this is the question I believe
that our, you know, our thousands of
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:listeners are gonna want to hear from
a professional, so business owners.
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:And W2 workers face completely
different tax games.
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:As you know, what's the
single most expensive mistake
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:you watch W2 workers make?
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:Not because they're careless, but because
no one ever told them the rules that
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:you have helped me with a few times.
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:Pam Jordan: Yes.
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:So you are a hundred percent correct.
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:There is a very different tax
game for W twos versus 10 90
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:nines, all the problem is.
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:People don't understand
the games and the rules.
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:Most tax code was written to help you not
have to pay taxes, not make you pay taxes.
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:And so the biggest mistake is W2
workers just swallowing the payroll
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:tax and paying it to the IRS and just
accepting that that's the only option.
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:There are other things that you can
do as a W2 to limit your liability.
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:Money because your W2 rolls to
your personal tax return, your 10
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:40, but there's things that you
can do with your personal money
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:to further reduce your taxes.
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:of which are wealth building.
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:And far too often the choice is,
look, you're gonna pay the IRS 20
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:grand anyway 'cause you made $300,000.
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:Do you wanna pay the IRS 20 grand or
do you wanna put that 20 grand in this
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:investment vehicle that will give you
dividends over time and you will get your
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:principal portion back in five years.
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:If you give the money to
the IRS, you get nothing.
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:Like what?
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:What do you wanna do?
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:And the problem is, most w twos don't know
that there's options out there for them.
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:And anyone, even a W2, can own an
LLC that is an investment vehicle.
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:So if you are a W2, you know, if you're
a high net worth individual, your 30
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:plus tax bracket, you need to be putting
money aside either to pay the IRS or
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:what I would suggest is to intelligently
use it in tax strategy ways that builds
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:your wealth so that you keep the money.
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:Because the bill's gonna come due.
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:It's your choice whether you pay the
IRS or whether you keep your own money.
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:Jerremy Newsome: Yeah.
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:Yes.
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:That's awesome.
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:That's great advice.
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:I mean, what I heard you say is.
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:Hey, anyone can create
this taxes or paperwork.
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:Do you wanna create paperwork for a new
business, AK and llc, so you can take
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:advantage of certain tax strategies?
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:Pam Jordan: Absolutely.
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:It's, I, I mean, it's a hundred
to $300 depending on the state,
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:Jerremy Newsome: So wait a minute, Pam
are, are you telling me that if you
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:work in the United States of America
and you pay an exorbitant amount of
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:W2 taxes, that anyone can do this?
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:Pam Jordan: So weird.
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:Who knew?
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:Jerremy Newsome: That's cool.
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:Yeah.
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:That's really, really cool.
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:I love that.
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:well yeah, then walk me through
the feather in the cap of all that.
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:So you have an individual or
a client that you work with.
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:What have you noticed as it relates
to the spirituality of money?
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:Let's just dive into that for 10 to
15 minutes and then we're gonna get
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:political 'cause you're awesome.
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:How do you help someone feel
they are deserving of more?
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:And what roadblocks or hurdles do you
help them pull back or do you notice
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:that people have the most around that?
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:Pam Jordan: Yes, let's go to Money Church.
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:Come on.
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:Jerremy Newsome: Come on, I.
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:Pam Jordan: the problem is of us.
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:And psychologists will tell you different
ages, but somewhere between the ages of
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:three and seven, our world told us who we
are, what she, we should believe, who we
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:were to other people, and what money was.
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:And most of us have a really screwed
up version of most of those things,
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:and that's why anxiety and depression
and everything are through the roof.
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:So somewhere in our early years
we were told that money is
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:evil and we shouldn't want it.
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:Or oh, he must, Never be home for dinner.
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:And that's why they have that nice car.
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:Oh, oh, he's gone again.
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:You know, or, oh, I could never do that.
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:I, I would wanna take all
my money and give it away.
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:Or, oh, they're starving people in
Africa, you know, and so these phrases
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:that we hear as children mess us up.
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:And very few entrepreneurs realize that
their personal income se ceiling is
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:directly related to that subconscious
message that was given to them as a child.
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:And it is bull crap.
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:Jerremy Newsome: Hmm.
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:Pam Jordan: the first thing entrepreneurs
need to do, and I see this all the time,
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:when clients are plateauing in revenue,
there is a block in their subconscious
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:and their mind, in their belief system.
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:And this happens with pricing big time
that came from their five-year-old
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:self and their grandpa saying
something that, oh, that you know
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:that he must not be a very good,
good HUS provider because X, Y, Z.
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:Right?
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:Or saying, you know, your mom
struggling at the grocery store because.
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:You know, you're a single parent
and blah, blah, blah, and work
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:is evil and money is evil.
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:And that's why I never
have the toy I want, right?
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:And so if you can't identify that
and change the script, there is a
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:significant limit to your income
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:Jerremy Newsome: Gotta change the
script, the, the beliefs in our
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:head are gonna create your reality.
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:Yes, that's.
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:Pam Jordan: gotta do the work.
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:And very few people do the work.
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:Jerremy Newsome: Yeah.
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:Totally.
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:Totally, totally.
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:Well, speaking of work, I, I think
it'd be fun at some point to talk about
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:the wage gap with you, and I'm just
gonna throw that in your mind just to,
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:just to hear your perspectives on it.
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:Pam Jordan: the gender
wage gap 'cause I got
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:Jerremy Newsome: Yeah, yeah.
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:Just wanna, just wanna
get your perspective.
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:I'm just gonna throw that in there as
like a, Hey, this is coming, so that your
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:subconscious can start working on it.
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:Pam Jordan: teaser for me.
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:Jerremy Newsome: That's right.
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:That's right.
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:Because, because the old deal, right?
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:The 1970 sixties, eighties, you know,
economic deal in the US was built on
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:a model that assumed essentially one
income comma, one full-time caregiver,
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:and a nine to five working clock for
skilled women who are also mothers.
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:That model was never real at all.
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:When you watch employers struggle
to attract workers right now, how
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:much of that gap is just the old
model finally failing the people
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:that it was always failing, and how
much of it is something different?
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:Pam Jordan: I think that old model
should have died decades ago.
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:And so I think that the gender thing
is a whole, a whole can of worms.
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:So one of the reasons that I started my
business, I had a job offer after, that
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:company that I worked for went bankrupt.
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:I had a job offer and it was
a good salary, but it was
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:gonna be 60 plus hours a week.
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:And I was gonna get on a plane
on Monday and be home on Friday.
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:I had three kids under three.
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:I wanted to raise my children.
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:I wanted to be there.
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:I wanted to be there when they
took their first steps and
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:drop them off at preschool.
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:and so one of the reasons that I've
built the, type of business that I've
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:built is to accommodate working moms.
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:And most of my team are
in fact working moms.
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:Jerremy Newsome: Mm-hmm.
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:Pam Jordan: team calls have kids on them.
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:Jerremy Newsome: Yeah, totally.
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:Pam Jordan: Right.
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:Like we, our client calls don't have kids
on 'em, but our team calls, like I had
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:my, a meeting with my, my assistant this
morning and her, she's got a kid home.
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:Okay, well that's fine.
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:So her kid came in the frame, I waved
at her, she showed me her bunny.
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:Fantastic.
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:And then we went on with our meeting,
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:Jerremy Newsome: Mm-hmm.
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:Pam Jordan: my full-time bookkeepers
are full-time with toddlers and
401
:infants, and they can do more in
30 hours a week than most people.
402
:So the problem is.
403
:People are trying to get the workforce,
female workforce to sit in a cubicle or
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:at a desk away from home, nine to five.
405
:We can't do that.
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:Do you know why?
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:people get sick.
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:There's field trips.
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:Pickup is at three 10.
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:Jerremy Newsome: tell me about it.
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:What,
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:Pam Jordan: Like I, I drop my kids off
and my husband and I have to alternate
413
:who's gonna pick up the kid each
day to see which one of us gets the
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:prize of working till five o'clock?
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:Jerremy Newsome: yeah.
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:Pam Jordan: And as business owner,
once I get, you know, so I pick 'em up,
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:get 'em home, okay, well then I can do
another little bit bit more work, you
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:know, handle some emails, whatever.
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:But then I can't.
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:But it does changes.
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:'cause this week, like today, I don't
have a soccer game, but tomorrow
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:we do have a soccer game and on
Wednesday we have a tennis match.
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:So like, if you want hardworking
females in your business, you cannot
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:succeed with requiring them to be
in an office nine to five because.
425
:A lot of times the female
is the primary caregiver,
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:Jerremy Newsome: Mm-hmm.
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:Pam Jordan: because of the wonderful
wage gap that you mentioned.
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:Jerremy Newsome: Mm-hmm.
429
:Yeah.
430
:So hearing you say like that no
skilled female worker can sit in a
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:cubicle nine to five and and make
that work anymore, what does it cost
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:a company, not even just financially,
but maybe even philosophically
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:when it refuses to figure that out?
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:Pam Jordan: Millions.
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:Because you have an entirely untapped,
skilled market that you're not
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:utilizing because in your brain,
the only way to work is at a desk
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:if you're down the hall from me,
people can produce amazing results.
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:Amazing product for your clients virtually
in part of the time, because when my
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:moms are working, they are locked in.
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:Jerremy Newsome: Mm-hmm.
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:Pam Jordan: they know that
in two hours they gotta go
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:get their kid from preschool.
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:So are they doing all this?
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:No.
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:Like they are dialed in getting the thing
done because they know what's coming.
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:And it is in my, from what I've seen
with my team, it is the wage gap, right?
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:Like all of their spouses work outside
of the home and make more than them.
448
:Therefore, they're staying
home with the kids.
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:But now they're making really good
money working for me and competing
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:with their husband for income.
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:Wow.
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:Still being a mom and being like,
Hey, I gotta go to the dentist today,
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:or the orthodontist or whatever.
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:Like, so and so's throwing up.
455
:Cool.
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:Good luck.
457
:What a bucket.
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:You know, like, go.
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:Jerremy Newsome: Yeah.
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:Yes.
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:Yes.
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:Three under three.
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:I'm, I'm still trying to figure
out where your award is for that.
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:it's somewhere though, Pam.
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:It's somewhere.
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:Pam Jordan: Yeah, that
was not well planned.
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:All I can tell you is my
husband's really cute.
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:Alex: The numbers DON'T lie—but
most business owners never look
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:close enough to see what they hide.
470
:Next, the conversation shifts to
who the old work model was always
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:willing to leave behind—and the
cost still compounding today.
