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SPI 071 : Successful Start Ups, Millions Lost and Everything In-Between: Inside the Mind of Noah Kagan from AppSumo By Pat Flynn on June 19, 2013

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In this session of The Smart Passive Income Podcast, I’m happy to welcome Noah Kagan, founder of AppSumo, employee #30 at Facebook (and the brain behind the status update), #4 at Mint.com,

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founder of several other startups and a person who at a relatively young age, in addition to all of his success, had already went through an incredible amount of failures and had lost millions. After a mid-life crisis and some self-discovery, Noah has become one of the more popular personalities on the

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Internet, most recently having founded AppSumo.com, a company which bundles popular web apps together for a discounted price. I am one of AppSumo’s 700,000

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Noah reached out to me a while back and said he wanted to create the most popular SPI Podcast episode ever. After hearing a little bit of what he had to share, I definitely knew

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that his interview would be up to the challenge. Noah definitely brought the goods.

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There are a ton of extremely educational takeaways from this

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episode. Noah has some amazing stories to share, both wins and (lots of) failures, and he does a great job of making sure that all of us listening understand what he learned and why things work the way they do. He’s a brilliant marketer, so

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make sure you pay attention to exactly how he does things and actually stays risk-averse, although it may not seem like it.

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The section about validation is pure gold. This session was recorded in April so please don’t mind the

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references to the surrounding months, and make sure to

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catch the tail end of the show where he does a lightning open in browser PRO version

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round of tactics about how to find a great idea for a business if you don’t have one yet, and also how to grow your existing business if you do have one. More specifically, in this session you’ll find out about: The first few businesses that Noah created while attending college at UC Berkeley.

REALITY CHECK - 24 QUESTIONS THAT WILL CHALLENGE YOU AND YOUR BRAND (+NSD2.0 UPDATE)

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What Noah learned from his early experiences in WHAT'S BETTER: HAVING 1

business.

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How Noah lost millions of dollars and what he learned from his experiences. Why Noah says getting fired from Facebook was a good move on their part.

A STEP TOWARDS ETHICAL LINK BUILDING - WHAT HAPPENED AND WHAT NOW?

How Noah got in the conference business and made

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$50k in profit the first year.

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Totem Poles and validation. How to know if your idea is worth creating, and how to make sure people will pay for it. How Noah got his job at Mint.com after getting rejected the first time. Marketing = who is your customer + where are they? Quant-based marketing. The Coffee Challenge. How Noah is actually risk-averse. Noah’s experience with Facebook Apps and how his first app got 1,000,000 installs in the first week. Details about Noah’s mid-life crisis while he was running his games business. Takeaways from another failed business and how it open in browser PRO version

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turned into something else profitable. Noah’s strategy for meeting people. How AppSumo got started and what the inspiration was behind that. (Plus, how Noah validated it.) The #1 problem for every business in the world. Noah’s top two tips for making sure you always stay true to what you truly want. 10 actionable and tactical tips to help you find ideas if you haven’t started yet. Right click here to download the MP3 Items mentioned in this podcast include: AppSumo.com How to Make a $1000 a Month Business Ok Dork | How I Made Over $100,000 Organizing Conferences open in browser PRO version

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Ok Dork | How to Deal with Depression Mint.com Quant Based Marketing The Lean Startup by Eric Reis AppSumo.com/hipat (for the Coffee Challenge) Surprising Lessons from 100 Days of Rejection Dropbox MacHeist Reddit My Favorite Quotes from Noah’s Interview: “When you play in someone else’s sandbox, they are going to make the rules.” “The customers will always tell the truth.” open in browser PRO version

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“People should do what they want because they want to, not just because of an opportunity.”

WIN A TRIP TO AUSTIN, TX TO HANGOUT WITH NOAH AND THE APPSUMO TEAM As Noah said in the later half of this session, he’s going to cover travel and lodging expenses for one commenter on this post, from anywhere in the world, to come hang out and work with him and the App Sumo team for a day. He will award this prize if this post reaches at least 300 comments. In order to qualify, all you have to do is leave a comment below telling me and Noah what you are going to do or what you did do TODAY to start or improve your business. Noah will select the winner himself and we’ll get in contact open in browser PRO version

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with you via email to talk about arrangements. Good luck! Update: Congratulations to Tyler from BrainMadeSimple.com who Noah selected to come out to Austin to hang with Noah and his team! (Show some love and CLICK HERE to say what’s up to Noah on Twitter!)

QUESTION OR FEEDBACK? LEAVE ME A VOICEMAIL! If you have a question you’d potentially like answered on the show, or just feedback in general (constructive criticism and praise are absolutely welcome!), feel free to visit my voicemail page to quickly and easily leave me a message. I may feature you and your question on a future episode!

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Thank you all for checking out this session of the SPI podcast! If you haven’t done so already I would love if you took a minute to leave a quick rating and review of the podcast on iTunes by clicking on the link below! It would be extremely helpful for the show, and I’m aiming for 1000 5-star ratings before the end of the year! We are currently at 872 5-star ratings! Thank you so much! Leave a review for the podcast!

TRANSCRIPT Click Here to Download the Transcript for Session 71 (PDF)

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LIKE WHAT YOU'VE READ? If so, please join over 75,000 people who receive exclusive weekly online business and blogging tips, and get a FREE COPY of my eBook, eBooks the Smart Way! Click on the green button below! GET STARTED!

629 comments Join the discussion‌ Best

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Nora Jacques

4 days ago

I just called my first client!!! • Reply • Share ›

Aida Bond

24 days ago

After I listened to this podcast I knew I had to act. This summer I started to gather some ideas and did a lot of research and before the end of the year I launched Heart Care Matters. the complexities of caregiving for your loved one with heart disease but I am taking a leap of faith and acting! brings attention to a subject that is oftentimes overseen. URL: www.heartcarematters.com • Reply • Share ›

Scott Denton

2 months ago

This was the best episode yet. I have never commented on any type of blog post, but felt compelled to do so for this one. I just came across the SPI podcast about a month ago while looking for ways to market my offline business (and I'm already up to session 071). There isn't much out there along the lines of "smart active income" so I am having to re-purpose the lessons I'm learning here for my business - with tangible results! Noah was for me the first guest who's ideas - sorry awesome ideas - I can directly implement in my day to day. Pat, thanks for all that you're doing. It is greatly appreciated. • Reply • Share ›

rcphillips

3 months ago

This was a great episode and it made the monotony of a long drive enjoyable. I just wanted to say that I really appreciate the blending of real emotion and hard core takeaways. I have a day job and have a start-up which is gaining a lot of steam and I am always looking to hear justification for what I am going through. Many times those wh have 'done it' make it sound like it was relatively easy and formulaic. We all know it is not and so I am on the lookout for podcasts that separate the internal personal struggle, from the real operational issues.

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for podcasts that separate the internal personal struggle, from the real operational issues. I would love to hear the story of someone who has made it a rule to bootstrap each project. Cheers • Reply • Share ›

Christine

7 months ago

Another great podcast, and this one took it to another level. I've read some of the comments and I think some people have missed some good points. Oh well can't keep them all happy. I will say my action item was finishing my logo which I did. And have since set up other actionable items in a list. And asking for a discount on things is my everyday life, that drives my friends crazy, but saves me money! So I am one of those people if you send me something free I will read it and take action. Keep up the great work Pat! • Reply • Share ›

Zack

7 months ago

Noah bounces around like a rubber ball! Awesome! Great stuff Pat you always take care of us! I got denied on the coffee challenge and a strange look I could have angled it different but I assumed the point was to not care about the outcome either way and just get in the habit of doing something different. • Reply • Share ›

Jarred

7 months ago

Pat, Great show... maybe the best one yet. You should definitely have Noah on again. Keep up the good work. • Reply • Share ›

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Robert Longley

7 months ago

I think this is the first interview I've heard with Noah. I've interacted with him in the past online and have always been impressed. This only reinforced my original opinion of him. • Reply • Share ›

JJ

7 months ago

This was my first show and I was completely hooked by the entire interview. Amazing. My action today was signing up at makeyourfirstdollar.com. So far some great content. Thanks! JJ • Reply • Share ›

Dan Scalco

7 months ago

People I look up to - Steve Jobs, Tim Ferriss and now Noah Kagan. • Reply • Share ›

michael englebrecht

7 months ago

Listening to this one again, 4th time. Great show, thanks for having Noah on. • Reply • Share ›

Marcos Soares

7 months ago

Hi Pat, Thanks for the podcast, really great content today. Regarding the question, I researched affiliates for my upcoming website and also people to interview for my upcoming podcasts, also tested the setup for the podcasts. It would be open in browser PRO version

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It would be nice to get a discount on "how to make your first dollar". Your Podcast Listener from Portugal, Marcos Soares • Reply • Share ›

David

7 months ago

I've been listening for a while now and during the interview with Noah I did something. I didn't go to Starbucks to ask I could get a discount (I prefer DD), but I DID pick up the phone to make some calls and to do some validation on an idea. I took the first steps to monetize a list of 30k unique email addresses daily with cross-selling opportunities. Thank you and keep up the inspirational interviews! Your podcast listener, David from Florida • Reply • Share ›

Kamil

7 months ago

Frankly, I was getting some rest. I find working 7 days a week counter productive. • Reply • Share ›

Hakim

7 months ago

I set up a meeting today with my business partner after listening to the podcast. I guess the best advice of this podcast for my particular case is getting to the action. Thanks for the talk. It was nice. • Reply • Share ›

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Awesome episode Pat! I'm going to take action on my blog and keep the momentum going from the 1daybb mastermind event. In fact I took Noah's advice and got a 10% discount at Starbucks. I event wrote about it on my blog. http://www.savemoneyandlivebet... • Reply • Share ›

Clayton

7 months ago

Great episode! Today I'm going to focus on what I do best, instead of trying to do every part of my software projects. In the next few months I'll avoid the things I don't have a passion for. Thanks • Reply • Share ›

Shaun

7 months ago

I loved this podcast and the tactics and calls to action. Today I worked on my first site. I posted an article and spent time learning about some plugins. There are so many and I want to use the right ones. Great show! Very motivating and inspiring. • Reply • Share ›

Cyrus Roepers

7 months ago

This episode was ridiculously good. I enjoy all your episodes Pat (and have at least one takeaway to implement for myself from each!), but it's definitely between this episode and Dane's interview that take the cake for me.

I would say I normally enjoy hearing about others' tricks of the trade and their tactics, but I really did enjoy Noah's talk about mindset and his openness to share his experiences as transparently as he did. The tactics he shared were you a developer? Try out the HTML to PDF API episode I definitely had more than one) was about the attitude open in browser PRO pdfcrowd.com greatversion but theAremain takeaway (although in this and


great but the main takeaway (although in this episode I definitely had more than one) was about the attitude and mindset to strive to adopt. Thank you Pat and thank you Noah for such a great interview. • Reply • Share ›

chris

7 months ago

Hey Pat, You did good, I know that Noah is a little more raw then most of your guests, but you handled it like a champ, I could hear your voice going "this is different" I appreciate your show and how you keep it clean, your boy's show fizzle is great also but that Chase cat has a mouth, funny but talks like a Dirty Pirate. that's his style and he has gotten to where he wants to be financially, he gave some great sound advice because he's been in the trenches and wants us to get up and Move. So it comes off a little cocky but, holds bars but it works, to be honest you can chase the money but as you well know and your other guests have mentioned that King Money will not give you the happiness your looking for, I call it temporary happiness, you better believe if I driving a lambo 140mph down PCH highway i'm happy, but it won't last. your family, friends, your relationship with God, that matters your legacy, how you leave this earth, your purpose in life. Thank you for all you do, keep it up, "money comes money goes but what kind of legacy are We going to leave our children? God Bless you and your family:) P.S my call to action was asking the Lady at the Ticket Window at the movie theater If she had a "Good Looking" discount, she laughed, my wife frowned and the Lady said NO. • Reply • Share ›

Shaun

chris • 7 months ago

LOL! That's hilarious. Good job for asking. open in browser PRO version

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Debbie

7 months ago

Pat, another great episode.... You are so adept at interacting with the Guests to keep the show flowing and entertaining and spontaneous yet coherent and cohesive. the push to get all these comments is paying off... Next I am going to mail you a personal thank you note! • Reply • Share ›

Stephanie Ann

7 months ago

Finally looked into finding someone to design an app that I really want to use. I'm still really unsure as it will be expensive and I'm not sure if it will be worth it. I am happy that I looked into it. Before I had no idea what apps even cost to produce. Now I have a much better idea of what I'd be getting into. • Reply • Share ›

Sean Allen

7 months ago

After listening to the podcast I took massive action and started a podcast that is the closest to my heart. "ife and depression"was listed on iTunes in the last 24 hours after I listen to Noah. By close to my heart I mean this literally. Four months ago I had open heart surgery which saved my life. Like most people, there were times in my life I have been low but recently I was diagnosed with depression. As a result of the heart operation the depression has disappeared. The aim of this podcast is to discuss how enlightenment is possible without trauma. How happiness can happen without drugs. The podcast has an introductory 00 episode and a first episode on "Near Death Experiences." I am going to sit down today and it do at least another episode. • Reply • Share ›

Jared Easley

7 months ago

I took Noah'sAreadvice & asked for a discount for my most recent rental car reservation. I wouldn't normally do this, bu you a developer? Try out the HTML to PDF API

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I took Noah's advice & asked for a discount for my most recent rental car reservation. I wouldn't normally do this, bu Noah made a compelling argument on the show. The rental car representative gave me his personal discount from the listed price online. Check out the screen shot: http://screencast.com/t/Anj6m0... #takingaction #austinbound? • Reply • Share ›

Jeff

7 months ago

Think and grow rich, that's what I like to do. So this article was perfect for learning about Noah. Good job, keep it up! • Reply • Share ›

kenshin

7 months ago

Wow! a great content to read and noah's wins and failures. It open the ears of every young minds. Thanks pat for reaching your website. I'm from Philippines. Have share this to my other friends here. • Reply • Share ›

Aaron Dutton

7 months ago

Hi Pat, What an awesome interview. While some ideas seemed a bit 'on the edge' It was great to hear from somebody that didn't get all swallowed up in the almighty dollar grab. Yes he has done alright for himself, to have the conviction of doing what makes HIM happy is a lesson for us all. I will be going to App Sumo and joining immediately. Keep up the good work Pat & Noah. Aaron Dutton • Reply • Share ›

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John hall

7 months ago

I probably missed out on the contest, but who cares...awesome show!!! Just wanted to say I was absolutely inspired by this podcast. I've been a non active listener for awhile and felt compelled to write after listening to Noah and you talk. You guys are a gret combo.. I justed started an Occupational Therapy business win wife (my wife's the OT)...I have literally just thought of a hundred ideas after listening to this podcast. Thanks from north of the 49th, eh? John h. • Reply • Share ›

Susan

7 months ago

I am a regular listener to Pat's podcast and have never commented before. Just wanted to let you know how much I enjoyed this. Noah was honest. Loved this show. • Reply • Share ›

Adam Cinemre

7 months ago

What a fantastic day!

Not only did I take action and overcome the nagging voice telling me not to do it, take the easy way out, 'you're gonna fail'! - I actually walked in, asked, and received a 10% discount at starbucks!!! The savings are not even what matters, the feelings that I got before, during and afterwards are exhilirating and I feel like it's set my mood for the rest of the day. Furthermore, rather than waiting a month to launch my podcast, we are going to just give it a go tonight after work and send it to 3 friends (as suggested by Noah) and get started immediately. If you want to watch my coffee challenge, check it out: http://tinyurl.com/AdamsStarbu... :-) open in browser PRO version

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:-) p.s. are you still deciding on who to fly over to the states!?... • Reply • Share ›

mike

7 months ago

Good content guys, like the points about people hiding behind research because they are scared to take action. • Reply • Share ›

Adam Cinemre

7 months ago

I think Mike beat me to it but the 'no and then' reference is from 'Dude, where's my car'. Probably not worth a buck but still funny! Great show guys, definitely one of the best to listen to!!! • Reply • Share ›

Rina

7 months ago

Great Post.. I get a lesson after reading this, do not give up and keep the spirit because success only belongs to those who dare to struggle • Reply • Share ›

Davinchi

7 months ago

Fascinating show today, I like the pressure to do something today. Motivation is the key to success. I am currently setting up the outline for my new business and taking action but doing my first 3 steps today. • Reply • Share ›

Matthew Cutler-Welsh

7 months ago

Arethis you a episode developer? Try out thetwo HTMLwhole to PDF API Pat, version I enjoyed over runs. open in browser PRO

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Pat, I enjoyed this episode over two whole runs. There's a common theme I'm hearing about the importance of just taking action. Glad you persisted and clarified the point about research though. You're doing a great job with interviewing. MCW • Reply • Share ›

Debbie

Matthew Cutler-Welsh • 7 months ago

someone else did two listened to this one besides me... Great! AND, not just a listener who is researching, I take Action after each episode, this one especially got me to review all my Meetup groups, and plan some ge togethers..... Network and make connections. Loved the persistence about research, I understood what was meant about not over analyzing whether or not to do something, but doing the validation and prep work is indispensable... Glad of how you handled all of it, Pat. keep singing, too!!!!! • Reply • Share ›

Alex

7 months ago

Thanks Pat for being you, and same to Noah..... two completely different type of people making shit happen! Making things happen is what I like about Noah and his style, it forces you to keep up, shut up, and do something and stop talking about it. I have asked for discounts many times at different places, some I've gotten and some I haven't. Building the courage to say something and to say it intelligently takes some discipline and practice if you're not used to it already.

Today I am continueing to working on a software service for chiros to help them manage patient paperwork while being compliant, avoiding audit violations, and qualifying for government incentives (those that apply for it), getting by insurance providers better and faster. • Reply • Share ›

Mike

7 months ago

Pat- No more and then is from: Dude Where's my Car? open in browser PRO version

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Great info man- keep the 'casts coming! PS- keep up the crappy singing, it's funny and i feel the same way! We're all rock stars in the car!! cheers • Reply • Share ›

Web Design

7 months ago

I blog frequently and I truly thank you for your content. This great article has really peaked my interest. I'm going to take a note of your website and keep checking for new details about once per week. I opted in for your Feed as well. • Reply • Share ›

Pat Gibson

7 months ago

Noah and Pat Real good podcast. Noah, there were at least a handful of real useful nuggets you provided and your journey and success is fascinating. I really liked the idea of hosting a meetup. As for the starbucks and 10% off, i don't have the guts to pull it off, i guess for fear of embarassment (although at a rest stop mcdonalds I do ask for the senior $1 coffee when i go through the drive through). I also liked the idea of googling something and adding "hate" to it. while i thought it was a bit awkward when noah kept asking about what he could do to make this the best podcast, that led to the 10 actionable ideas at the end which was great, so it served the purpose. This was one of my top 3 favorite podcasts, along with Dane Maxwell and Neil Patel. appsumo idea could be applied to different businesses - would something with restaurants work - where you sell a certificate packet good for 3 meals to 3 local restaurants? • Reply • Share ›

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Dr. Todd

7 months ago

Thanks for bringing the juice to podcast Noah. I appreciate your honesty throughout of your learning through failure and success. What I am doing today is being intentional about writing out my "why" for my new venture and having someone go over it with me tomorrow. I am big fan of Simon Sinek on TEDx. I will check out your site Noah. Thanks Pat! Keep it coming. Dr. Todd P.S. Starting my own site and company now. • Reply • Share ›

Jami

7 months ago

Great article, have been trying to document steps my self, my attempt here: any feedback.. Good luck! • Reply • Share ›

Patrick

7 months ago

No idea if you have picked anyone yet, but I'm a college student and Noah's words have set my butt on fire to go out and actually do something. These are the things that I have done: [1] I have been holding off doing some freelance work because its summer. I finished it and made $50 in 2 hours.

[2] I have a goal this summer to learn more HTML/CSS so that I can a/b test my websites myself and I spent 2 more hours going through the "Web Fundamentals" course on Codecademy.

[3] I have an Apple Developer account and I have finished two slot machine iPhone apps and currently they are being open in browser PRO version

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[3] I have an Apple Developer account and I have finished two slot machine iPhone apps and currently they are being reviewed by the app store. I have a goal of making 6 apps this summer. So far I've made 3. [4] I emailed Noah about the Pakistani dude for $12/hr

[5] I went to Starbucks yesterday and asked for 10% off. They didn't give it to me :( But it was awesome trying to get a deal. I did get free whipped cream. • Reply • Share ›

Alex

Patrick • 7 months ago

Good stuff bro, keep at it. Need encouragement, hit me up aruizinvesting@gmail.com • Reply • Share ›

Johnny

7 months ago

First the show was a great motivator. I very nervously did the coffee challenge. I walked in thinking this is kinda redicilous and could feel the sweat starting to run down my back; it didn't help that it was 109 degrees outside. To prolong the misery of anticipation two older women in front of me couldn't decide on their lattes. I stepped to the counter ordered and asked for the 10 percent discount and success!! What a totally empowering adventure! It made me realize I live in my comfort zone way too much! Next step, I joined "Make Your First Dollar". I'm now working on the raising my first dollar exercise! Thanks Pat and Noah I totally appreciate this episode! • Reply • Share ›

Crystal Foth

7 months ago

I just listened today? Did you already pick a winner? Today I worked on slides to add a feature to my website. Something that I think will inspire. I'm new to wordpress so learning something new everyday! PODCAST PAT! Thank you so much! • Reply • aShare › Try out the HTML to PDF API Are you developer? open in browser PRO version

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Ronnie Harper

7 months ago

Listening to Podcast right now. Wrote my script today for my online business. Will shoot video very soon. Ronnie Harper mysportsd.com • Reply • Share ›

Steve

7 months ago

My first listening to this podcast.... Great stuff! Thanks! I connected today 3 people to get their goals done and supervised a old friend to optimise his business. Trough that action I made a good new contact which will double my net profit per day and that will increase the speed of reaching my own goals. Actually I always help first and than often years later the contact I helped will get me profit trough new contacts or direct business. Kind regards from Germany Steve • Reply • Share ›

Allen Maddox

7 months ago

Pat, your podcasts are usually inspiring, but this one with Noah really got my wheels turning. So many possibilities for my next action item. Oh yeah, one more. Write down all my potential action items. • Reply • Share ›

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