The No-Nonsense AI Workflow for Entrepreneurs

What if the AI tool you bought was designed…on purpose…to never be used?

Joe Downs and Peter Swain start the episode with a gut-punch of a question: what if that shiny AI tool gathering digital dust on your desktop wasn't $20 a month... it was $400,000? 

That's a real story.

And the reason it failed has nothing to do with technology. 

Joe and Peter answer a listener question about all-in-one AI subscription bundles… and why most of them are thin wrappers around outdated models built on the assumption you'll never actually use them. 

Then the episode takes an unexpected turn into the $500K ceiling every solopreneur hits, and why AI might be the only thing that breaks it. 

If you're a business owner, side hustler, or professional who feels like you've traded every available hour for every available dollar… this one's for you.

Listen For

4:02 Are those all-in-one AI subscription bundles actually worth it — or is someone betting on the fact that you'll never use them?

7:26 What's the behavioral science behind why we keep falling for Swiss Army knife AI tools that end up collecting dust?

12:13 What's the only AI toolkit you actually need as a business owner, and why does Peter say Claude and Manus are your starting point?

20:46 How did a company spend $400,000 on an AI tool and end up with an 11% adoption rate and what does that have to do with you?

38:52 How can AI help solopreneurs and business owners finally break through the $500K time-for-money ceiling?

Links Mentioned

• Claude
• ChatGPT
• Manus
• Gemini
• Descript
• Gamma
• Google NotebookLM

Email the “Idiots” Joe and Peter Idiots@successfulidiots.com

Joe Downs

Website | Email | LinkedIn | YouTube

Peter Swain

Website | Email | LinkedIn | X

Transcript

Peter Swain (00:00)

That $500K ceiling comes from the fact that the business model of selling time for money can't scale beyond that.

Joe Downs (00:09)

You. It's you. Picture this. You just bought a shiny new AI tool. Maybe it was 20 bucks a month, maybe it was 99. Maybe someone in a Facebook group swore it was going to change your life and that's why you bought it. And three weeks later, you haven't opened it once. Does that sound familiar? Now imagine that same feeling, but the total cost was $400,000. Yeah, 400 grand. And only 11% of your team even touched it. That's not a made-up number. That's a real company. And the reason it happened has nothing to do with the technology. Today we're going to fix that problem and we're going to answer a listener question that gets exactly at the heart of it. In this episode, we'll cover why your AI tools aren't working and what it actually means to use them well enough to buy back your time.

Joe Downs (01:01)

Peter, I've got a guy named Reno on one side and a $400,000 cautionary tale on the other. Are you ready for the show today?

Peter Swain (01:10)

Oh, I feel pain already.

Joe Downs (01:14)

I'm Joe Downs with me is Peter Swain. We're just a couple of successful idiots who figured out how to use AI to improve our lives and run our businesses. And every week we're blown away by its power and we hope you are too. So here we go. But before we do, Peter, true or false — AI has done more for small business owners than the entire British Industrial Revolution.

Peter Swain (01:39)

Part of me says false. I mean, the AI revolution is Geoffrey Hinton, the godfather of AI, who's unfortunately British. And you wouldn't have computers if it wasn't for the Industrial Revolution, so you're welcome.

Joe Downs (01:52)

Ooh, interesting. All right. I told you in the green room. I was curious to see how that would get answered.

Peter Swain (01:59)

Usually — I would say AI will ultimately do more and will have a larger societal impact than the Industrial Revolution. That I'd say.

Joe Downs (02:08)

Okay. Interesting. All right. Yeah. I was looking forward to that one because usually AI wins, but you took the other side.

Peter Swain (02:16)

You put it against the Empire's legacy. I can't possibly agree with that.

Joe Downs (02:22)

I thought that was a T.

Peter Swain (02:24)

That's part of the Empire.

Joe Downs (02:26)

All right. Fair enough.

Peter Swain (02:26)

Enough.

Joe Downs (02:27)

Oh, cheers. Cheers to you. All right. First, a listener named Reno wants to know about an all-in-one AI subscription platform that we've seen advertised. It's a good question. And the answer connects to actually the $400,000 mistake that a lot of companies are making — and actually a lot of people are making at a much smaller scale. Same mistake, different number. Then there's a guy named — I hope I don't mispronounce this — it's Michael Kitces, K-I-T-C-E-S. I saw a post, so I apologize, Michael, if I butchered your last name. Kitces. Anyway, he posted something about a $500,000 ceiling, which is something Dan Sullivan would call ceiling complexity. In this case, it was a $500,000 ceiling, I think specifically within the niche that he advises people on. But I think every business owner has their own ceiling, and that's the point. That's what really hit home for me — $500,000. Well, we'll get into it, but I think this is something that every entrepreneur, every business owner, anyone who's trading time for money, is hitting the ceiling, just differently.

Joe Downs (03:42)

But first, let's get to Reno because we got an email from a listener. His nickname, I guess, is Reno — full name Anafrió de Janeiro. I hope I said that right. Why did you—

Peter Swain (03:55)

Even try and say that one?

Joe Downs (03:58)

I don't know.

Peter Swain (03:59)

You could just go with Reno. Just set yourself up.

Joe Downs (04:02)

All right. We'll stick with Reno. He's been listening. He's already using AI and he writes — I'm kind of paraphrasing here — about platforms where you get multiple AI tools in one subscription. So he referenced MagicAI, Zolo, Galaxy—

Peter Swain (04:25)

GenSpark. Galaxy.

Joe Downs (04:27)

One or two of them advertised during the Super Bowl. I remember seeing that. And a bunch of others. Can you talk about whether or not they're worth it or what the downside might be? And before you do, Peter — Reno, we're going to get you that answer — but your question made me think of first, and Peter, this is back to the post I saw. I think it was a LinkedIn post. It caught my attention about the $400,000 cautionary tale. The post is by Sherry Levitan — God, what? I'm terrible.

Peter Swain (04:58)

Just stick with first names.

Joe Downs (05:00)

I probably just butchered the two easy names and nailed the harder one. Sherry Levitan. All right. She's a sales trainer. Big name in her field from what I can see. She posted something this week that I think is the real answer to Reno's question. And that's the company that spent 400 grand on an AI sales tool and had an 11% adoption rate. So now Peter, no one listening is spending 400 grand — at least I don't think our listeners are spending 400 grand on AI. But I can pretty much guarantee they've all signed up for something, right? ChatGPT, Claude, at least at 20 bucks a month, maybe more. And if we're being honest — we've all signed up, guilty as charged by the way, yours truly — for something you saw on an Instagram reel or a Facebook reel or story. And a month later they've barely opened it. Same failure, different price tag, different prop. Peter, why does this keep happening? Why do people like me fall for these multi-use utility knives — the Swiss Army knife of tools? And then a month later, six weeks later, we're not even using any of the tools in it. And good on you, Reno, for asking before you go spending like I do.

Peter Swain (06:28)

Okay. So why don't we end up using them after six months? Because they're useless. That's the answer to that question. I mean, that's an easy one because—

Joe Downs (06:38)

Well, but let's take the Super Bowl commercials. In the Super Bowl, you had Claude advertising, right? That's not a multi-use tool. Well, it's an incredible tool — as anyone listening knows — you and I both love it, but it's not advertising like a Swiss Army knife of, "I can do this and I can do that." Whereas you see these commercials for — you said GenSpark, Galaxy, Super Human, or Super whatever. I've seen another one. Super cool. Yeah—

Peter Swain (07:10)

Let's not give them any more airtime. All of them. Yeah.

Joe Downs (07:13)

Right. But you've seen how they advertise — I can do this and your calendar and this and that. And all of the AIs can do that for the most part. So why are we falling for it? What's going on?

Peter Swain (07:23)

On?

Joe Downs (07:23)

What's the behavioral science behind this?

Peter Swain (07:26)

Okay. So let's go — first of all, why are they doing it and why do they get to advertise in the Super Bowl? Because there's so much confusion out there that marketers currently have a window of opportunity. So it's like, "Hey, Joe, why don't we go and subscribe to these platforms with huge amounts of credits and then we can just mark everything up by 20% — because, drum roll, we know they're not going to use it." So if we charge our customers $25 a month, we can have access to these 20 platforms because we know they're not going to use the 20 platforms, so they're not going to consume the credits. So we end up at — their entire business model is based on you not using the product. It's the only way the math works.

Joe Downs (08:11)

Which is true because we don't, and that's the whole setup.

Peter Swain (08:14)

Yeah, because if you look at it — Claude is $20 a month, ChatGPT is $20 a month, Gemini is $20 a month. So when somebody comes along and says, you can get access to all 20 of these services for only $25 a month — well, 20 times 20 is 400. So how are you buying something that's worth $400 direct from source through a third party for $25?

Joe Downs (08:41)

Well, so let's unpack that. What I just learned that I maybe didn't know before is when I do buy this — what let's call it an aggregator service, because that's what it—

Peter Swain (08:51)

Sounds like. I like calling them wrappers.

Joe Downs (08:52)

Wrappers, fine.

Peter Swain (08:53)

Because that's all they're doing. They're just wrapping the thing.

Joe Downs (08:55)

I didn't even know they were ... So they're just a white label on top of another AI.

Peter Swain (09:01)

Yep.

Joe Downs (09:02)

Okay.

Peter Swain (09:03)

And it says you can generate images. They're just using some third-party model. And normally they're not even using the most recent model. They're using a model from a year and a half ago that isn't very good. So not only are they just wrapping other people's stuff, they're wrapping other people's outdated stuff and selling it to you. Kind of the oldest play in the book, unfortunately.

Joe Downs (09:28)

Interesting. So we're seeing this everywhere because you're saying they've realized this is the gold rush.

Peter Swain (09:35)

Yeah.

Joe Downs (09:36)

This—

Peter Swain (09:36)

Is the time. The next year or so, you'll be able to count on doing this. You can make a very healthy business. You're just wrapping other people's stuff and selling it to people, knowing that they're not going to use it. If anyone actually did use it — like used all the models — then the company would go out of business very, very quickly.

Joe Downs (09:53)

Okay. So — because it's not that long ago — I've been in your mastermind for over six months, I'm sure, but that's a relatively short period of time. And I would say—

Joe Downs (10:08)

I've had a pretty good ascension without really understanding AI. Still not understanding AI fully, but understanding it more than most. I can remember vividly the confusion — which tool, why. It's taken me a while to understand, well, this one's a little better for that. And then even inside of those tools, you get the different models. Do I use DeepSeek? Do I use this? Do we use that? In fact, Peter, the very first time I remember paying for ChatGPT, I paid for the wrong AI. It had a nearly indistinguishable logo from—

Peter Swain (10:45)

What—

Joe Downs (10:46)

I thought was ChatGPT. So not only are they trying—

Peter Swain (10:48)

To compete with — hopefully OpenAI sued Apple for that, for allowing all of those clones on the App Store, because there were hundreds of them and they just changed it from black to green, but it was the same logo. It was really disgusting the way that was done.

Joe Downs (11:03)

I paid for like 60 bucks, I think, because of course I was being smart and paying for the year, or whatever it cost me. So you have that confusion. They're throwing different artwork at you and you think you're probably — but I'm day one, I don't know how to use this, or I'm day 30 and still brand new, or I've seen the magic and power of the email, but I don't know what I don't know about AI. And now I'm being presented with these tools that look amazing, that do all these things that sound like they're going to make my life better, whether it's personal, business, or both. What is my approach to this? How can I not be Joe Downs and be more like Reno who stops to ask the question? He's probably an attorney — stops to ask the question.

Joe Downs (11:56)

But he's stopping to ask the question before he's making the purchase. I'm the guy that's like, "I'm in — that does all those things. Where do I sign up?" But I'm wasting my money and I think there's a lot of me out there. So what's a failsafe to save us from these mistakes?

Peter Swain (12:13)

Well, the first thing is — get Claude, get Manus, stop there. Get Claude and get Manus. If you get a subscription to Claude and Manus, then you have 99% of the use cases that you would need as the average business owner. Then there's some bolt-ons. If you do video, then you should get Descript. If you do video production, if you do lots of slide presentations, Gamma would be the next bolt-on. If you're in graphic design or marketing or producing collateral and assets, then Gemini. But your core toolkit as of today is Claude and Manus. Now that could change. ChatGPT's latest version just came out last week, everything's in flux here, but they're the only two tools you need. You asked why — why do people do it? Well, for the same reason that Black & Decker sell multi-tools with 13 different attachments that go on the same screwdriver — it's more convenient.

Peter Swain (13:19)

There was a great quote by Gary V once — when Equifax got hacked, and it was around the same month that Facebook got fined for leaking data to Cambridge Analytica, and he turned around and said, "Facebook's share price will go up tomorrow because everybody will be on Facebook complaining about Facebook. And if you think anyone cares about Equifax, check back in the news in three days." The only thing — and he said he didn't like the fact that this is true — the only thing that human beings care about truly is convenience. We are hardwired in our neuroscience. We're hardwired to be as lazy as possible to save ourselves the calories, to conserve energy. So when somebody comes along and says, "This thing can do 15 things and your thing can only do one thing," it naturally speaks to us. It's like, "Oh, cool.

Peter Swain (14:16)

Well, that's obviously a great idea." So yeah, unfortunately, really, genuinely, it's just a bit of a shill. There's no good reason for it.

Joe Downs (14:29)

Is there a test we could put in place — a question we could ask ourselves — that's something we say, "All right, you're presenting me with this next amazing piece of technology. How do I know if I need it? Is there something that I could say to myself — look, if it doesn't do this or if it doesn't do that—"

Peter Swain (14:52)

I'm just—

Joe Downs (14:52)

Looking for a ...

Peter Swain (14:54)

So first of all, just don't do that. One of the things that people get wrong in something like AI — and you know my background, I've been in behavioral marketing for 30 years, and so I've been in disruption all of my life — and I have seen so many people run to the disruption and then try and frame a business use case around the disruption, and I've never really understood it, because to me, it's the other way around. Come up with the business use case and then go and find the technology that will satisfy the thing that you're trying to achieve as a business. So is there a test for a new technology? To me, that thinking is upside down. The right way is to say, "My referral rate from my customers is one in 15. If I was to get my referral rate to one in 13, it would make me this much money." And then have a conversation with Claude and say, "How do I go about doing this?

Peter Swain (16:01)

What is it I need? What tools do I need? What experience do I need? What people do I need? Help me put a plan together to achieve this thing."

Joe Downs (16:10)

Okay. So here's what I just heard. If looking at a technology, if I ask myself — using your example or just generalizing it — this saves me X amount of time or dollars, or this makes me X amount of money by doing this for me, then I should buy it. If I can answer that question. If I can—

Peter Swain (16:42)

Put an—

Joe Downs (16:42)

ROI on that question, if it either—

Peter Swain (16:45)

Saves—

Joe Downs (16:45)

Me time or money or helps me make money by doing A, B, C, X, Y, Z, then I can measure it.

Peter Swain (16:54)

And you can put something else in there if you want: "And I'm willing to risk this much to find out."

Joe Downs (17:01)

Okay. Well, that would be the ROI part, right? Yeah.

Peter Swain (17:04)

Well, often you'll go, "You know what? I don't understand this, but if it's just going to cost $100 to find out—" but you still have to have the prize first. "If this could do this, it could make me $68,000. Okay. Well, if it could make me $68,000, then I'm willing to risk, gamble $100 on the subscription to this thing to find out."

Joe Downs (17:31)

I think that's it. I knew there was something to get to. We all need our own failsafe because, to your point, our human condition is — do you know what I do? Mine's slightly different.

Peter Swain (17:44)

Do you know what I do? Mine's slightly different.

Joe Downs (17:46)

Okay.

Peter Swain (17:47)

I subscribe to everything. I go, maybe that's — now I'm in the industry. I'm in the business. It's one of my jobs to try this stuff out. It's why I actually get paid to do it. But here's what I share with everybody else: I buy the thing and then I cancel it. So I do a monthly subscription and before I even use the software, I hit cancel on everything that we buy. So I'll subscribe to the 30-day plan and then I hit the cancel button. I've now got 29 days, and I do it with my team as well. Everybody on the team, we all do the same thing, so that it now requires people to tell me on day 34 that the thing they just went to use is no longer working. Because I don't want to stop my creativity. I don't want to deny myself.

Peter Swain (18:40)

I'm a person that wants to chase down the rabbit hole a bit and I enjoy this stuff. So I don't want to stop that from happening, but I want to limit my liability. I want to limit it to 30 days of — whoa, whoa, whoa. Because I think if, again, we're all honest, we can look at our personal bank statements and go, I'm paying for how many streaming services that I don't use.

Peter Swain (19:04)

I'm happy to risk a month. I'm not happy to risk two or three or four or six or 18.

Joe Downs (19:10)

All right. So either preemptive — or if you want to be, well, let's call it more entrepreneurial and try things out — you could do it Peter's way. But preemptively, it sounds like, hey, just ask yourself. So if there's 20 tools, 20 shiny objects in one bundle, what I'm hearing is: does one of them work? Do I even need one of them? Does one of them finish that sentence, complete that sentence for me? And folks, it sounds like if you want to be a little more daring — which is me — I just need to now adopt Peter's principle. New to me is: subscribe, but cancel, and then see if you miss it.

Peter Swain (19:50)

Yeah. I bought a roaming package the first time I was in the States on my personal phone and legitimately it was 14 months later where I went, "What is that charge on my phone bill?" Because my phone bill is so variable — it goes up and down every month. I never bothered — and maybe this is just not very professional — but I never itemized it. I went, hang on a second, $9 a month. So this is where this came from. I'm like, "Well, if I just bought the subscription and then canceled it, I know I've got the month, and if I miss it, then I'll add it back in." But unless I miss it, I won't.

Joe Downs (20:26)

So I love this for — and this is I think the right answer for who I think is more likely our listener, the entrepreneur. What say you to the $400,000 whoopsy?

Peter Swain (20:46)

I want to have grace. That's what I want to do. I'm sure it was well-intentioned. You said 11% adoption. 11% adoption means that there had to be at least — what's 11 divisible by? Nine. So there had to be at least nine people in the company, because otherwise you wouldn't have said 11, you'd have said 10. So it has to be a nine to 18-person company. If it's a nine-person company, it means one person used it — which is the person that bought it — which is really bad. So let's assume it's a slightly bigger company than that. I'm sure it was well-intentioned. I'm sure it was well-informed. I'm sure they were very well sold. But AI projects — MIT did a study on this and came back and said 96% of all AI projects fail. And when you look through them, what they normally do is they're top-down projects.

Peter Swain (21:39)

So leadership has come up with this great idea and bought this thing and then told everyone to use this thing, not realizing that people are scared — they're worried about their jobs. The entrepreneurs love change because change is where opportunity lives, but employees, as a general rule, are not so fond of change. That's why they have a job. So they're being told to adopt this thing that they believe — at least some of them believe — could be about to take their job from them. So why would they adopt it? So it's not normally about the technology. It's normally about — ironically — it's the humanity that goes wrong in the introduction of the technology. It's not actually managing and leading and coaching your teams and going, "Hey, this is what this is. This is what it does. This is how it works. This is why we should use it.

Peter Swain (22:27)

And these problems go all the way up. Accenture just let go of 12,000 people, I think it was. It was a big number. It was over 10,000 — it was definitely five digits — because they weren't adopting AI. So some of the brightest consultants in the world are being removed by companies like Accenture because they don't want to do it.

Peter Swain (22:50)

So I feel for them.

Joe Downs (22:52)

I think you nailed it and it was kind of a rhetorical question. You have to answer the same question whether you're buying it for yourself — for Reno buying one tool for himself or evaluating a bundle versus one AI tool — or whether at the top level, a C-suite level, and you're making $400,000-or-more decisions like this. If you can't answer those questions, then you probably shouldn't buy it. Or you should probably go get those questions answered, because it would probably lead — my guess is it'll lead — to a different kind of purchase, a different kind of service that actually—

Peter Swain (23:29)

Matches the need—

Joe Downs (23:31)

Of the company.

Peter Swain (23:32)

It's very sadly not a unique phenomenon. I think I've heard about this kind of thing quite a bit because the metrics are so sexy that at a leadership level, they're like, "Hang on a second. I put this in and we can increase efficiency by 58%. Okay, let's do it." And not really thinking about what that could mean downstream. So I think as soon as you're spending — but hopefully it was a multimillion-dollar company and hopefully $400,000 to them is the equivalent of $400 to you and me. Yeah. But $400,000 is a lot of money to sit on the shelf.

Joe Downs (24:07)

Yeah. Well, and that's what struck me about it — it's the same problem. It's just a $400,000 problem is a $20 problem. It's all relative and—

Peter Swain (24:18)

That's what — the reason I'm not okay with it, but the reason I'm like, "Okay, okay," is because at that level of business, the prize here with AI — which you know and I know — is everything. It's not just a 1 or 2%, it's 10X, 20X, 50X your business type returns. So I think there is now a space to be risking more than we normally would. Because if everything's changing — which it is — it's kind of beholden on you to make sure you're at least keeping up if not trying to get ahead of the thing slightly. So I think you are going to see more people place bigger bets and some of those will work and some of those won't. So having some framework of ROI-based thinking around what is the metric we're going to move, and what is the unknown, what is the human factor that is going to resist this change — I think that is absolutely key.

Joe Downs (25:25)

I mean, in a lot of ways, that's the bet I'm making right now on building Storage Moguls. If I look at my company, we're spending money on AI — just Belrose Group, right? And the tools that are sticking are the basic ones.

Joe Downs (25:41)

They're fulfilling needs. My employees and partners are using it and slowly adopting it more as they're realizing and being fulfilled by the results of it. And they're having those aha moments that eliminate maybe some specific annoying task every week. But I'm making a bet on Storage Moguls, Peter — and obviously you're helping me build it. And for those listening, Peter is literally my consultant on it. We're using AI. I'll explain it real quick and I guess it's going to come out like a commercial, but we're using AI to educate students in completely new ways, right? So the how-to guides, the Google NotebookLM, which allows us to use multimodal educational techniques so people can have an immersive experience — except we're actually getting it — what I'm seeing from folks, because we built GPT tools, we're actually getting adoption first in a lot of ways, and then implementing it.

Joe Downs (26:55)

But we are taking that leap that you're talking about, assuming that folks who want to learn more about self-storage and storage in general, who want to join our community at StorageMoguls, I'm taking a leap that they're going to use this AI, right? That's kind of—

Peter Swain (27:13)

Baked in here.

Peter Swain (27:16)

When we're on the weekly calls, you actually — I'm sure you've noticed it — you actually see me push back on the team when they try and use too much AI. That's true. I'm like, "No, no, no. Calm down. I want to see a human run this prompt first and I want to SOP the human first so that we actually know that ..." Because one of the worst things about tech is if we put a fully automated solution in — and it's going to sound like I'm speaking against you and I'm not — what always happens is the client or the owner goes, "Oh, that isn't what I meant." Because the client or the owner very rarely has briefed technical people adequately. It's not your area of expertise, so you don't know what you don't know in order to tell me everything I need to know. So if I roll out the $100,000 or million-dollar AI solution and you then say the dreaded words of, "That isn't what I meant," we're about to delete half a million dollars' worth of technology — literally — and do another half a million dollars' worth of technology.

Peter Swain (28:19)

So in any project where you're walking into the unknown — which AI certainly is — minimum viable product should be your mantra. How do I get the smallest investment in time, money, and energy across the line in order to prove whether this works, before I start automating? All these big words are wonderful once you know that if the human presses the button and copies and pastes the thing, the output is what you want.

Joe Downs (28:55)

The flip side to that — and I thought you were going here — is the owner on a call with your team, and this is a real-life example that you've also said no to on my behalf: the owner, when presented with shiny new objects, wants them because they're shiny and they're awesome looking. And in a universe where everyone just adopts AI all the time, they make a ton of sense. 100%. But back to this 11% adoption rate — which I'm assuming would grow from there — right? It's a question of, well, how much money am I spending to get a tech I don't need yet? Maybe we'll introduce it—

Peter Swain (29:43)

Later.

Peter Swain (29:46)

I think it's actually worse. If you start saying yes to all the shiny objects, then it's not even just how much you're spending — it's the fact that you'll probably never get your project live, ever. Because it becomes this kind of drama triangle of self-fulfillment. What happens is you — in this case — will go, "Oh yeah, let's do that. That would be amazing." So the consultant goes and does it. And now you've just given them a head pat and you've given them a dog treat and you've expressed to them that your happiness is dependent on them finding you cool stuff. So they're now going to go and find new cool stuff and go, "Look, I found another one." And you're like, "Wow, that's great. Let's do that as well." All the while, the metric of — in Storage Moguls' case — four and a half thousand students enlisted in a platform receiving weekly education has been pushed to the wayside next to this cool and shiny.

Peter Swain (30:40)

And the cool and shiny of today is not cool and shiny tomorrow. So by the time you implement it and get it scheduled and tested and verified and validated, it's not even shiny anymore. So you just bought something dull and boring.

Joe Downs (30:53)

Yeah.

Peter Swain (30:54)

I like getting a solid business up and running — and then layering on top of it — versus just pursuing the sexy thing.

Joe Downs (31:04)

No, and I've noticed that and I appreciate that because AI is so new to all of us. I'm blown away by it constantly.

Peter Swain (31:14)

And just for the record for everybody else — in my weekends, 100%, I've got OpenClaude running and I'm doing VPNs into Telegram and I'm trying to write books with Claude Code and skills and chaining this and da da da da da. But when you rock up at the office, whether it's a home office or otherwise, it's discipline and math. What is the math? What am I trying to achieve? What metrics am I trying to move?

Joe Downs (31:40)

Don't give away all of our future episodes. All right. I didn't intend for that to turn into a commercial, but you might as well finish it, Peter. You're basically building, guiding, consulting this development of this platform and business for me. I'm absolutely happy to vouch for you. I'm a proud mastermind member. How do people reach you? We might as well finish the commercial that—

Peter Swain (32:10)

I'm going to surprise you and I'm going to tell you more about it later on. What I think people should do is reach me on socials and stuff, PeterSwain247. And what they should do is DM me — what is Hypertuned?

Joe Downs (32:25)

DM you — what is Hypertuned?

Peter Swain (32:27)

What is Hypertune?

Joe Downs (32:29)

And where do they do that?

Peter Swain (32:30)

They can do it at peterswain.com, the website, or PeterSwain247 on any of the socials.

Joe Downs (32:36)

All right. All right.

Peter Swain (32:38)

You don't even know what it is yet.

Joe Downs (32:40)

I don't. I'm intrigued.

Peter Swain (32:42)

We have a cool schedule. It's the latest and greatest thing in the world ever.

Joe Downs (32:49)

I can't compete with that because you haven't finished my business to compete with that. So all you could do for me — if you're interested in real estate — is go to storagemoguls.ai and register. But it's coming soon, and it sounds like it's coming after Hypertuned.

Peter Swain (33:04)

Or at the same time.

Joe Downs (33:06)

Or around the same time. Love it. All right. So, little commercial detour — didn't mean to happen here — but Reno, that's your direct answer. Those all-in-one platforms are almost always thin wrappers around existing models. And you're paying for convenience. You need to nail a single use case.

Peter Swain (33:30)

Thin wrappers around outdated models as well. Outdated models.

Joe Downs (33:34)

Even worse. So go back to that sentence — what does this specifically do for you? Can you calculate an ROI? Answer that. Then and only then, I think, does the platform question even matter.

Peter Swain (33:48)

And if you can't calculate it, how much are you willing to risk to validate it?

Joe Downs (33:52)

Okay. Good. I like that add-on. Awesome. Thanks for the email. Keep those Dear Idiots emails coming — idiots@successfulidiots.com. All right. Next, because Reno's question was so interesting — it actually touches on two different things I saw this week that I wanted to bring together into the show. So I saw another post. Michael, as I referenced in the opening — Michael Kitces — I'm just kidding, Michael. He's a big name in the financial advisor world. I should say he's got a lot of followers. And he posted something this week about research showing — I thought this was so interesting — that income and life satisfaction basically stop moving together at around $500,000 a year. So I'm assuming it means that they're moving up together and they plateau around—

Peter Swain (34:49)

$500,000 a year. It was researched quite a while ago and it says that happiness and personal income scale up to $72,000 in direct correlation. So that $500,000 I'm assuming is company revenue versus take-home revenue, because that would be about the same number. So up to $72,000 a year, your happiness index will increase in line and equally. And at $72,000 it starts tailing off. The reason being — at $72,000, you can feed yourself, feed your kids, feed your family, buy a car, go on holiday once a year. Unless you live in California, obviously, you've achieved a basic level of income. After that, the difference between buying a TAG Heuer watch and a Rolex watch doesn't really massively move the happiness needle.

Joe Downs (35:45)

Okay. I think that's probably true for the basic human condition. But what I think his article was talking about was professional. So maybe after you hit that mark and then you're back in the—

Peter Swain (35:55)

Well, I think the $500K revenue was company versus personal — because if you do $500,000 as a company, you're probably taking out 10, 20K a month yourself once you factor in tax, which gets you roughly back to this number I just said.

Joe Downs (36:10)

Yeah. Okay. So now for a lot of people, that $500K might sound like a problem they'd like to have, but here's where it landed for me. The ceiling isn't really about money — it's about time. Because I was thinking about — and I think his point was these professionals at that $500K revenue, maybe in this case financial advisors because that's who he has a lot of followers in — I'm sure that's where they max out their time, right? Because there's only so many hours in a day, assuming people work more than eight, but less than a ridiculous amount. So that's why, for me, when I read that, I was like, "Well, that's really interesting." Even if it disagrees with your sentiment that it's $72,000 and it's revenue — even if that's actually income — the point is they've hit a ceiling, right? So that ceiling though is $500,000. That's a big number for a lot of people.

Joe Downs (37:16)

My point is, I don't think the number matters — and that's kind of your point too. To me, it's the hours, because your margins — hold on. All of our margins are different, and AI is changing that. But as a financial advisor, my margin is different than, let's say, me as an electrician. So in the same amount of working—

Peter Swain (37:38)

Hold up. There's an important little detail to add in. Okay.

Joe Downs (37:43)

Well, the point of me asking the question, then you can rip it up and chew it up and spit it out. But the point of me asking the question is — if I have a higher margin with the same amount of hours, and let's say that gets me to $500,000, or I have a small donut shop or bagel shop — I still only have the same amount of hours as the financial advisor. But my margins, and where I can peak out revenue-wise or even take-home pay-wise, they're correlated and the same. So it's the same ceiling — not because of dollars. He was suggesting in this article — and I'm not saying he's wrong — is that at that revenue or take-home pay amount (we can debate that), at that number, your life stops improving. And my point is, it's not that number, it's about those hours. Because a donut shop owner and an electrician could be just as happy as a $500K take-home-pay or revenue financial advisor.

Joe Downs (38:46)

Both of them have run out of revenue-producing hours. How does AI help us with that?

Peter Swain (38:52)

Okay. So I wasn't going to disagree with anything you said. I'm just going to add something that I read once that I think is quite profound. One of the mistakes people make is they take the $500,000, they take their working hours, and divide it to come up with their hourly rate — but it's not true. Because you — and they've done this, again, this is research that is scarily accurate no matter how many times you apply it — on average, people spend a third of their time selling and marketing their business, a third of their time doing the admin and legal stuff around their business, and only a third of their time actually delivering the product or service that they get paid for in their business. The reason I think that's so important to what we're discussing is the guy that runs the donut shop and the financial advisor don't have 60 hours a week, which is what you might think.

Peter Swain (39:55)

They actually only have 20 hours a week to actually do the thing, because they've got to spend 40 hours a week doing the other stuff. And this is where we can see how profound the impact of AI can be — because can AI right now help you make a donut? Actually, the answer is yes, they have a robot kitchen that can do that. But anyway, let's pretend the answer's no.

Peter Swain (40:21)

But can it do your taxes? Can it do your bookkeeping? Can it do your writing of your blog post? Can it add huge amounts of efficiencies into that 40 — I'm going to assume 60 hours for this example — can it buy some of that 40 back? Yes. So if you can add an extra five deliverable hours of work to a financial advisor that can only do 20 deliverable hours, you've removed five of the 40 — so one-eighth of the burden — but by doing so, you've added 25% into the deliverable hours. Because the majority of time you spend in your business is not spent doing the thing you're good at. It's spent doing the stuff that you don't want to do — that you're not very good at — in order to do the thing that you want to do.

Joe Downs (41:20)

I've never looked at it that way.

Peter Swain (41:22)

That's why I was trying to interrupt you.

Joe Downs (41:24)

Thank you. Well, you always have permission there, but that's so fascinating. Because if you think about it — when I say we, I mean I'm speaking for everybody, so apologies folks if I'm not speaking for you. I try to sound smart. But if we look at — the way I look at AI is I want it to take care of some of those other 40 hours that I'm not good at. It's not revenue-producing. It's indirectly revenue-producing, because I have to do them in order to be able to produce—

Peter Swain (42:04)

The revenue. It's revenue-supporting, but not revenue-producing.

Joe Downs (42:08)

I always look at it like I'm just trying to get those hours back. I've never looked at it like I'm putting those hours back into revenue-producing activities. And I don't know if that's a — there's got to be some sort of multiplier effect to that. It's not a linear—

Peter Swain (42:29)

It's crazy profound. Because what if that five hours could now go into researching the partnerships that you need in order to sell your product through a different medium or a different method or a different message, so that you could jump out of the swamp and go from $500,000 to two million, because you worked out how to da da da da da. That $500K ceiling comes from the fact that the business model of selling time for money can't scale beyond that.

Joe Downs (43:03)

You. It's you. It—

Peter Swain (43:05)

Can't scale beyond you. You can't scale you.

Joe Downs (43:06)

And that was my point.

Peter Swain (43:08)

So what are you going to do? You're going to take a $100K step back in order to not sign that client. And if you're brave, you do. I've sat with people when consulting and said, "You need to fire those clients." They're like, "That's going to cost me $10K a month." I'm like, "Yeah." But those clients are costing you the opportunity to grow. And AI can come in and say, "Oh, okay, so great. So this thing can do X, Y, Z and A, B, C, and it can buy us that space." Now think about this as well, Joe, because I love this from a whole-life perspective. Imagine if on average you spend 5, 9, 12 hours with your husband or wife. If you add that five hours we've just recovered and you add it into your personal life, you're not just adding five hours a week — you are — but you're chaining 12 into 17. That's a massive difference in connection, in engagement, in intimacy, in—

Joe Downs (44:16)

30-something percent more.

Peter Swain (44:18)

It's a huge difference. So human life — and especially that of a solopreneur — is wildly inefficient. We spend roughly 40 hours in order to do the 20 hours that we want to do. What does a guy who does tires get paid for? He gets paid for putting tires on a car. What does he have to do to do that? He has to go to trade shows. He has to have contracts. He has to speak to Michelin and Bridgestone. He has to take deliveries. He has to do HR. He has to do finance, tax, admin. He has to pay business rates. He has to open the shop. He has to clean the floor. There's like a thousand tasks that have to happen just so that he can do the one thing that he's actually really good at, which is taking the tire off and doing that machine, and then putting it back on.

Peter Swain (45:11)

And you as the customer are paying for all of those other things to be done, because somebody has to pay for it and you'd rather just pay for the tire. So maybe he could cut 10 of those hours of admin off and then turn around and say, "You know what? I'm just going to drop my prices by—"

Joe Downs (45:29)

20%.

Peter Swain (45:31)

Yeah. Wow. It's wild when you start thinking it through. I learned this in the hotel business when we saw that a $150-a-night booking only resulted in $15 in the hotel's pocket. So if we could change the price point from $150 to $155, the customer was only paying an extra $5 on $150, but the hotel was getting an extra $5 on $15. So their margin went up by 25%.

Joe Downs (46:02)

Yeah, it's huge.

Peter Swain (46:04)

It was a really big moment in my life when I realized the amount of inefficiency that we carry in order to do the thing we want to do.

Joe Downs (46:12)

I knew the ceiling — I sensed when I read it — it wasn't just about money, it was about time. Because when you've traded every available hour for revenue, that's how you arrive at that number. But I didn't expect us to go where we went partially, which was — we can use AI. What we need to do is a time audit. We can use AI to get back some of those 40 hours, which is really what you were talking about. How can we use AI to accomplish the things that we're not good at and that we don't love, so we can do more of the things that we're good at and that we do love — which are theoretically the revenue-producing activities.

Joe Downs (47:06)

We danced around it and we didn't say those specific words, but I think everybody understood it. But what I didn't expect, Peter, was the more human part of it — the personal life part. Because it's not just — you nailed it. Even if you just saved five hours out of those 40 admin hours, let's say, and you didn't put it back into revenue production because you don't want to — you just got 33% more time back in your personal life. Maybe with your wife, maybe with your kids, maybe just with a hobby. That's a round of golf, the way my brain works.

Peter Swain (47:47)

So add a dinner date, a round of golf, and a couple of beers with some buddies. If you want to change how happy you are in your life, those three things are probably going to do more than an extra $50K.

Joe Downs (47:59)

Once a week, right? That's five hours a week we're talking about. So yeah, I didn't really expect us to go in that direction, but I'm so glad we did. I love this show. I hope you guys do too. It's nothing but a pleasure.

Peter Swain (48:15)

And if you don't, I'm not sure that matters because we do.

Joe Downs (48:18)

Yeah, it's—

Peter Swain (48:19)

True.

Joe Downs (48:19)

We do. All right.

Peter Swain (48:23)

I'm assuming that this many minutes into the show you wouldn't still be listening if you didn't like it. So I'm hopeful that I didn't just speak to somebody who doesn't.

Joe Downs (48:29)

That's true. All right. Takeaway — AI doesn't fix everything automatically, but it absolutely helps you see it, start chipping away at it, and that's worth something. All right, Peter, great show. If you enjoyed it like we did — I know I did, and Peter just said he did — give us a like, a subscribe, or a follow or whatever that says, "Hey, remind me," and share it with your network if you wouldn't mind. We appreciate it. Keep those Dear Idiots emails coming — idiots@successfulidiots.com. For Peter Swain, I'm Joe Downs. We are your Successful Idiots. Thanks for listening and we'll see you next week.