The tactics we used to scale Kilo in the early days
We've grown from 0 - 1000 clients,
We're on the Inc 5000 list of the fastest-growing companies in America in 2022,
We've spent almost nothing on advertising.
The majority of this growth was in the first year.
Here is the story and some of the tactics we used to accomplish our early growth.
Be there, do that
I owned a gym in small town Ontario. I started in my garage and eventually got up the guts to quit my full time job, buy a building, spend $20K on equipment and become an entrepreneur full time. I was 23 years old. I ran that gym for just over 5 years before I sold it to my general manager. I've experienced almost everything a business owner can experience, from not knowing where all my money is going, firing staff and members, working 5am -10pm every day to finally becoming profitable and becoming functionally retired. I've worn all the hats.
This story is not unlike many of the stories of most gym owners. We are all pretty much the same, with a few minor details changed here and there. The shared struggle brings us together.
Actually being in your customers shoes gives you the credibility to help them. If someone knows you understand their problem, they automatically think you have the solution.
Find business partners
Partnering with people is scary. We've all heard nightmare stories of partnerships gone bad and I certainly did not want to experience that.
Myself and our Kilo founders, John and Mateo met through a mentorship company that we used to improve our gym businesses. We worked together on smaller projects (see below) first and were able to see where we complimented each other. Where John was strong with vision, I was strong with implementation. Where I was strong with creating a system, Mateo was the one who could make it come to life.
Back then, we didn't know we would start a company together. We just knew we liked working together and had great results on projects. We wanted to do more of that.
Find the pain
Most small business owners struggle with the same things: time, money, staff, the inability to scale and marketing. At the time our mentor was helping us solve 4 out of 5 of those problems. The missing piece was marketing. Small gyms don't have the manpower, the money or the time to try and figure out a marketing strategy.
The more gym owners we talked to, the more I realized what we all struggled with marketing our businesses. Our problems were only separated by distance.
We didn't know what to put on our websites, how to capture leads, what to do with leads when we captured them, or how to get them to book appointments with us. Also, what's a funnel and why do I need that?
Create a primary, scrappy solution
John and Mateo built a marketing course to teach gym owners to advertise against some of the largest, well-funded gyms in the country. I used the same marketing course in my small town and it worked exactly as advertised. They stitched it together with the software they had available at the time.
After building a sales team for the mentorship company and becoming a business mentor myself, I was brought in to help with the marketing course. I refined it, reorganized it, built a new team to deliver it, dealt with unhappy customers, and convinced other gyms owners to use it.
Since we had worked with our ideal customer for years and knew them personally we could speak to their pain and offer a solution. We had built credibility in our field as gym owners and as marketers and they trusted our solution.
Hundreds of gym owners about this course. It wasn't perfect, it had a lot of steps and it was actually pretty hard for a gym owner to set up - but it worked. Gyms finally had a way to market themselves. We taught them how to create sales videos and manual call scripts. It was beautiful, in a scrappy kind of way.
Realize there is a better way
During that process we realized that it was still difficult for gym owners to market efficiently. While the course worked for a lot of people, there was some gym owners who never completed it because the set up was just too much.
They had to use 8-10 pieces of software and stitch them together with Zapier. There was a ton of manual work and often leads and clients still fell through the cracks. Organizing a client pipeline through Google Sheet is not for the faint of heart.
This was the inspiration for Gym Lead Machine, now known as Kilo.
Acquire a company that solves part of the solution
Websites are a key component in advertising and we knew that it would be part of our company's solution. We bought an existing website company that was already serving our ideal client base. They had about 90 customers at the time of acquisition. We did nothing but serve them a little better than the last owner and listen to their struggles.
One of the fastest ways to cashflow is to buy a relatively boring business, keep the client base and improve the systems. We needed to hire people, build out tech and test solutions. We used the cashflow from this company to create Kilo.
Partner with an amazing company with similar clients
Since we were so involved with the mentorship company we had used ourselves for many years, we naturally wanted to partner with them. They were helping gym owners with all aspects of building gym businesses and we wanted to make their job easier.
When gym owners start using Kilo, it makes a business mentor's job exponentially easier. Instead of advising the client about what copy should go on a site, how to book sales appointments or how to set up and lead nurture sequence, they can skip right over that and start working on sales training. It helps their clients get results faster. By providing a solution to a strategic partner that makes their service work even better, it create a win on all three sides.
Sell one (great) thing
We only sold one thing and that was Gym Lead Machine. It is a website + automation tool that allows gym owners to talk to leads, book sales appointments, retain clients and advertise efficiently. It's an all in one product and we don't sell the pieces separately.
Either people wanted it or they didn't. There was no, "what if I only want one piece" conversations. It was all or nothing. We didn't even take sales calls for the first 8 months. We had people purchase directly on our website.
Since then, we've separated the website product. It's an ascension tool to Gym Lead Machine.
Launch during the worst (but best) possible time
We officially launched in March of 2020. Yep, right at the onset of COVID.
When we launched, our goal was to sell 5 new clients a month.
We had to shut off sales at 5 new clients per day!
We sold to 42 clients in the first month and 71 in the second month.
Our customers were worried they would not be able to talk to leads or clients while they were closed and we gave them a way to do that. They were afraid their online presence would suck and we improved it for them. They were afraid they wouldn't have anything to sell, we set up an easy way to sell online programming.
Because we sold a simple, all in one solution that spoke directly to the fears of our customer and we already had their trust, we knocked it out of the park.
Have the need for speed
We were forced to simplify even more and get our product into customer hands quickly due to gyms moving to online training during COVID lockdowns. We stripped down the product to only the essentials and we could deliver a website and back en automation software in a matter of days. This outpaced the industry standard for website delivery by weeks, if not months.
The faster you can get someone from the point of purchase to delivering the product to them, the better client experience is and the higher client retention will be.
Bring in good help
All of the people we hired to work for us in the early days have worked for us in other businesses. I brought my admin from my gym and a former mentorship client, John and Mateo brought general managers and assistants from their gyms.
Bringing in good help that you can trust from the get go is key to building a cohesive team quickly. The right culture builds naturally. They have usually been with you through some of the tough days in the past and are keen to grind it out with you.
Growth after the first year has been more steady. Contracts run out, competitors enter the space and COVID hit gyms pretty hard so we have natural ebbs and flows between people leaving and new sales. Our churn rate sits at 1.7% and we've still been able to grow revenue by 25% each year since.
We're trying some new marketing strategies next year - John and I are building personal brands, John and Mateo are launching a podcast very soon, and we're building our gym management software in public.
I hope you'll follow along.