The 7 Levels of Scale: Acquiring Businesses for Growth

The 7 Levels of Scale: Acquiring Businesses for Growth

By Roland Frasier

When it comes to growing and scaling your business, the 7 Levels of Scale give you everything you need to know and do—and in the exact order you need to do it.

 

In previous episodes, co-hosts Roland Frasier and Ryan Deiss have walked through levels 1-5 of their proven and powerful framework, The 7 Levels of Scale. In today’s episode, they’re discussing Level 6, Complete an Acquisition for Expansion. This level is one of Roland’s favorites. He’s acquired over 1000 businesses over the course of his career and has been in the trenches of acquisition more than anyone else Ryan has ever met.

 

Before you listen, make sure you’re all caught up on Levels 1-5. Here are all 7 in their very important, non-negotiable order:

 

Level #1: Sell and serve 10 customers.Level #2: Build a growth flywheel.Level #3: Build an upgraded scalable operating system.Level #4: Double your take-home pay.Level #5: Build your advisory board.

 

Level #6: Complete an acquisition for expansion.

 

Level #7: Hit your number.

 

Once you’re caught up, listen in for everything you need to know about Completing an Acquisition for Expansion.

 

The Data Supports Acquisition for Growth

 

If this idea of acquiring businesses and assets is something that interests you, Roland has done multiple podcast episodes on the topic. He’s up to 220 ways to acquire a business. There’s no limit, and he’s constantly adding to the list. Every other month, he runs a 5-day EPIC challenge helping people acquire businesses.

 

Clients often ask Roland and Ryan: I could see acquiring a business to get into business, but why is it a level in this 7 levels of scale? Why is acquisition of another business a critical step to scaling a business you already have? 

 

Roland is quick to tell them that it’s not just his belief. The data supports it. Mergers and acquisitions have been proven to be one of the fastest ways to grow a company consistently. They absolutely need to be a part of your growth strategy. It makes sense. If you want to double the size of your business literally overnight, the simplest thing to do is acquire another business of the same size. 

 

Practical Reasons to Acquire a Business

 

Why do people want to grow their business? Some might say: I want to grow to achieve my goals. Okay, what can help you make that happen? Most of us know about a horizontal acquisition, acquiring our competitors. If you acquire a competitor, you’ve decreased your competition and increased your market share. It could be a replacement product or substitute or the same product but to a different audience.

 

Maybe you want to acquire to solve a challenge you face, which is currently constraining your growth. A common one is: I need more customers, so I need more leads. You could buy the customers directly by buying the competitor, or you could acquire the media that already exists, where somebody has already aggregated the eyeballs of your ideal client.

 

Ryan asks a great question: Why would we, who own DigitalMarketer, need to acquire media? Because everyone needs more leads, and it’s only smart to get them for the best deal possible. DM looks everywhere for leads—across channels and platforms, organic vs. paid. One of the richest veins of customers is finding someone who’s already gathered...

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