Latest / The Start, Scale & Succeed Podcast / Don’t Start the Wrong Business with Sheldon Wolf (stage 1) - Ep. 442

Transcript

Don’t Start the Wrong Business with Sheldon Wolf (stage 1) - Ep. 442 · The Start, Scale & Succeed Podcast

• 0:00
  Scott Ritzheimer: Hello, hello, and welcome, welcome once again
• 0:03
  to the Start Scale and Succeed podcast-the only podcast that
• 0:06
  grows with you through all seven levels of your journey as a
• 0:09
  founder. I'm your host Scott Ritzheimer, and there is some
• 0:12
  very, very bad advice that we in the coaching profession like to
• 0:17
  give. That advice is follow your passions, and especially for
• 0:21
  those who are thinking about starting a business, who are
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  thinking about, in some sense, risking it all to go in and try
• 0:28
  their hand at the entrepreneurial game, that could
• 0:31
  be a disaster waiting to happen. If you're not, if you're not
• 0:34
  careful, that could be one of the fastest ways to end up
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  starting the wrong business altogether. Well, here today is
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  our guest Sheldon the Wolf Wolf, who is a serial entrepreneur,
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  investor, and business architect with more than 30 years of
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  experience in real estate, finance, lending, and
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  technology. He spent his career identifying broken business
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  models and redesigning them from the ground up. Today, he is the
• 1:00
  founder and CEO of IntelliTary, an AI-powered unbrokerage,
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  strategically engineered backward to scale rapidly,
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  generate substantial recurring revenue, and maximize enterprise
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  value. Sheldon believes that the biggest opportunities aren't
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  found by improving existing industries; they're created by
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  seeing what everyone else misses in challenging the assumptions
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  that others accept as fact. Andy's here with us today,
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  Sheldon. Excited to have you. I'm really excited about this
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  conversation because a lot of what people think about in
• 1:33
  starting businesses is is either kind of problematic or really
• 1:37
  bad and boring to start with. So it's hard enough as it is to
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  start your own thing. How do we make sure we're actually
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  starting one that's worth starting?
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  Sheldon Wolf: Well, see what's interesting about me is I wear
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  two hats. One, I'm a founder. Two, I'm an investor. So when I
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  build businesses, I always build them backwards. Backwards is the
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  best way to build a business because you're starting from the
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  monetization. You're starting from where it becomes
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  profitable. A lot of people start from this crazy idea they
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  got while sitting around eating fries at a diner on a Sunday
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  afternoon. Out comes the napkin. Out comes the pen. And sometimes
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  these things are great. Sometimes people take their
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  hobbies and say, "Oh, if I can make a living doing this, that's
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  sometimes the wrong approach. If it's not going to make you
• 2:27
  money, then keep it a hobby. So I build things backwards. I
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  always design them to monetize, and I've built a specialty of
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  turning problems into profit because I see that far too many
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  times people do jump into that business that really should be a
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  hobby, and they go, "Well, it's not monetizing, or it's not
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  bringing in the revenue, or it's bringing the revenue, but
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  there's no profit. You know, it's that kind of thing that I
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  specialize in.
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  Scott Ritzheimer: Yeah, so good. So I want to distinguish between
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  this because I really love the language of a business or a
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  hobby. So tell tell me what the difference is, because and
• 3:03
  correct me if I'm wrong, but I kind of think of like I love
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  playing music. I love playing music. If I had to make a living
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  paying music, I think it would take all the joy out of it. So,
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  am I onto something like what's the difference between a hobby
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  and a business? How do I know the difference?
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  Sheldon Wolf: Well, you're 100% correct right there. I love
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  cooking. People told me for years and years and years, you
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  should you should open a restaurant. You should forget
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  it. That'd be the last thing I'd ever want to do. Even even if I
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  thought for one second that I should, all I'd have to do is
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  look at the financials from most restaurants, and I'd say, run,
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  run, do not do that. There are successful restaurants, but
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  really, at the end of the day, for every one really successful
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  restaurant making lots of money, there's there's nine of them
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  that aren't, and you could you could take that to a lot of
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  businesses, especially in this day and age of all these techy
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  entrepreneurs out there, and and a lot of the stuff that's being
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  designed, you know, I see the wall coming. I see the wall
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  miles before it gets here, and I just see far too many things
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  that are flimsy, and they just haven't they haven't been
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  designed to make money, or or as a hobby, you feel bad because
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  you don't want to profit from other people doing what you're
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  doing. You know, it's this guilt that people have. A lot of
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  times, people are their own worst enemy, and and not
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  everybody should be in business. Not everybody should be an
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  entrepreneur.
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  Scott Ritzheimer: Yeah. So let's talk about that because you're
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  you're speaking the language that I think has gone through
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  folks' heads, and there is this, especially the things that we
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  are most passionate about. There is this really difficult tension
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  of like, how how do I price it? Is it worth it? Should I charge
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  for it? What if somebody doesn't pay me? Should I pursue it?
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  Those things seem to get so much harder when. We're passionate
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  about whatever it is that we do, but on the flip side of that, if
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  if you don't care at all about what you're working on, does
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  that work either?
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  Sheldon Wolf: You have to love what you do. That's the first
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  thing I'd say. No matter what you do, it has to be something
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  you love because you're kind of getting married to your business
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  in an obscure way. It becomes your partner, so to speak, and
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  you become its partner. It's it's an entity relationship, but
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  the the fact is, if you hate going in every day, doing what
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  you're doing, it becomes tiresome. And you know, it's
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  funny is even some successful successful businesses, when you
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  hate doing that, even even the even the glisten of the gold
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  wears off real quick. You gotta love for for longevity's sake.
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  If you want to keep this business up and running for long
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  term, and if you don't, well then don't do it unless that is
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  your goals a long term business. But notwithstanding, you gotta
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  love it. I love like to me doing deals every day and business
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  every day and problem solving. To me, it's like going in and
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  doing different puzzles, playing different games. I mean, people
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  ask me all the time what makes me different. I treat business
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  as if it's like a sport, and I don't step in the ring just to
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  step in the ring. I step in the ring to win. Absolutely,
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  everything I do is revolving around winning each and every
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  company I build out. Every time someone says, "Hey, I've got
• 6:26
  this problem with my company, help, it's me stepping in the
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  ring. And if you don't have that psychology where you're there to
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  win, like I said, that's that's half of it is what goes on in
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  your own mind.
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  Scott Ritzheimer: Yeah, it's fascinating that we're having
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  this conversation because just this weekend I was actually
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  thinking about it quite a lot. I was at a cross country race, and
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  cross country races for anyone who's not been to them are like
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  these giant affairs with with 1000s of children that are
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  running. You know, it's like when I played soccer as a kid,
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  punishment was running. Right, is what happened when you did
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  something wrong? These these kids have all voluntarily chosen
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  to run miles and miles on a Saturday morning at six a.m.
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  It's insane, and one of the things I recognize, especially
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  as watching some of the faster runners and knowing the work
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  that went into that, they didn't just show up on Saturday morning
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  and and win. They ran mile after mile after mile, out of the
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  limelight, in obscurity, on their own, just putting in the
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  time and to to really win, you can't just love to win. I think
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  you have to love what you do as well, but you you have to love
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  to win as well, right? It really is both, and and I hear that in
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  what you're saying, and so when when we get into this game,
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  right? We we love what we do, and we love to win at doing it.
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  How do we take that and kind of drill that down a little bit
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  closer to s ay, what's the best opportunity in that kind of Venn
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  diagram?
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  Sheldon Wolf: and shred it. But it's one of those things that
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  she has to pay $8 to get the credit report, something like
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  that, and then she has to resell it to somebody for $12 because
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  there's only so much someone's going to pay her for whatever
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  the service is. So essentially, she's making $4 at a at a shop.
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  But I can tell without even touching anything. This is just
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  where my experience comes in. I can tell you right now the
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  actual cost of a customer acquisition to get the customer
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  to pay $12, where you're only making four of it, is going to
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  be anywhere from 50 to $100. So at the end of the day, she's
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  going to tell herself a whole bunch of lies for the next year
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  or two until she goes broke and says, "Wow, I'm making 30 or 40%
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  rate of return on on this customer. I'm buying something
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  for X dollars and selling it for this, but then when she gets her
• 9:24
  financials done, she's gonna realize that she's losing her
• 9:26
  shirt. But I see this all the time. I see someone buys a
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  trinket or a sprocket or a gidget gadget, whatever it is,
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  they're buying it for $5 and selling it for 10. Even if
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  they're selling it for for 15 and they're going, wow, I'm
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  tripling my money. No, you're not, because if it costs you
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  $100 to get that customer, then you're losing money. Very
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  simple. So, it's that hidden, invisible profit column that
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  people seem to like to ignore. And it's funny because even when
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  you look at these big, massive, publicly traded companies,
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  they're sitting on NASDAQ and they're always talking about how
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  much revenue. I was talking to a bigger company a few weeks back.
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  Same story. They lost $26 million in 2024. They managed to
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  only lose $12 million in 2025. Halfway through 2026, they're
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  already past the 12 million they lost. Anyway, they ventured into
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  some new technology and this and that, but they paid something
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  like $18 million to acquisition this one company, which they
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  probably could have just hired a bunch of tech guys and for
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  $5,000 had the same technology. But bottom line is, I see even
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  big massive companies, and nobody will ever admit they made
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  a mistake. So what they do is once a year they just unload,
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  they fire all their top CEOs and this guy and that guy, and bring
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  in some new guys. But really, at the end of the day, they're
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  bringing in people who don't know the industry. They're just
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  bringing in people who have acronyms and alphabets after
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  their after their last name, and they think that look, we've
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  really upgraded. Well, you're still going to lose money unless
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  you change the philosophical plan of what it is you're doing.
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  It's sometimes it's the architecture, and it's like
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  maybe maybe you need to raise your price, but we're going to
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  lose all our business. Well, you're better off not doing any
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  business than losing every time you do business.
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  Scott Ritzheimer: Absolutely, absolutely. One of the things
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  that I think you have a knack to do is is to see things that
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  others don't, but but that's inherently tricky, right? If
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  nobody sees it, there's probably a reason nobody sees it. How do
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  you how do you help others to kind of see through the mist, if
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  you will, to see the opportunity that that the general population
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  would miss?
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  Sheldon Wolf: Well, there's two types of people. There's two
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  people who pretend not to see it because they know it's probably
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  going to be their job, especially if they're the ones
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  who made the mistake. So they don't want to point out their
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  own error. They want to keep looking at that revenue column,
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  which is looking nice and robust. The second guy is I see
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  this often. He's a great tech guy. He's an amazing software
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  guy. He's built this awesome software for this industry,
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  except he's never worked a day in the industry. But the
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  software is great, so of course people throw hundreds of
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  millions of dollars into this great concept. But no one's
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  there to drive this thing. No one's there to really get this
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  thing profitable, and I see that a lot too. So it's not so much
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  like the first guy who doesn't want to point out something
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  that's to be his own demise. This guy genuinely doesn't know
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  any better. In his mind, it's great software. What's wrong?
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  Why is this thing not just? Why aren't people just lined up
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  buying our software? Why aren't people? Why isn't everybody just
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  using this? And and that is partially correct. It is great
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  software, but if you don't have the right people driving it, I'd
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  rather have crappy software with awesome awesome people driving
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  it. It's like you know the old McDonald's theory. They are not
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  the best hamburger. End of story. But they came up with a
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  way to sell a lot of burgers can't argue with that, but
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  they're certainly not the best hamburger. But the guy who makes
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  the best hamburgers usually in his own backyard, flipping
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  burgers for his family, right?
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  Scott Ritzheimer: As a hobby and not a job. Yeah, yeah, yeah. All
• 13:13
  right, awesome. Well, Dominic, before I let you go, I've got
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  two questions for you. One's a real softball, but the other,
• 13:18
  before we get there, is this question that asks all my
• 13:21
  guests, and it is: What is the biggest secret that you wish
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  wasn't a secret at all for any founder, pre-founder out there
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  watching or listening today? What would you like them to
• 13:30
  know?
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  Sheldon Wolf: It's not so much a secret; it's insight. I wish
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  everybody had insight the way I do. Where I got my insight is
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  experience. After over three decades of this, you tend to
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  just instantly see something. I've already made that mistake.
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  I made that mistake in 1996. I already saw that, or I already
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  dealt with that recession. I already dealt with this wall
• 13:53
  that everyone hit. So you've been there, done that, and you
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  get that from experience. But if I could just package a thing
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  with a magic button that says hit this button every time you
• 14:03
  run into a problem. That's just insight. That's experience and
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  insight. And I wish I could package that and give that to
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  everyone who needs it. Because nothing better than successful
• 14:13
  entrepreneurs doing well and avoiding the obstacles. That
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  that only experience lets you just walk around them these
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  days. You know.
• 14:20
  Scott Ritzheimer: Yeah, yeah, absolutely. If someone was
• 14:24
  sitting and listening, and you know, just piqued their
• 14:27
  curiosity, they were interested in learning more. Where could
• 14:29
  they reach out to you to maybe even glean some of that insight?
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  But where can folks take a what would a next step be with you?
• 14:35
  Where can they reach out and hear more about the work?
• 14:37
  Sheldon Wolf: You are more than welcome to contact me. You can
• 14:40
  reach me on LinkedIn. Easy to find under Sheldon Wolf. You're
• 14:44
  also welcome to email me directly at sheldon s h e l d o
• 14:50
  n@intellitary.com. Intellitary is i n t e l l i t a r y.com. I
• 15:00
  actually I'm old fashioned. I actually return email, and I
• 15:03
  actually will get back to you if you message me. Like I said, I'm
• 15:07
  I'm here to help. That's that's the fun for me. To me, it's just
• 15:10
  adding adding another game to my day. You know,
• 15:14
  Scott Ritzheimer: fantastic, fantastic. Well, Sheldon,
• 15:16
  fascinating conversation. I love the approach to thinking about
• 15:19
  starting the right business, not just making your hobby one that
• 15:23
  has to pay the bills. And really appreciate you coming on. Thank
• 15:27
  you so much for being here today. For those of you watching
• 15:30
  and listening, you know your time and attention mean the
• 15:32
  world to us. I hope you got as much out of this conversation as
• 15:35
  I know I did, and I cannot wait to see you next time. Take care.
• 15:42
  Hey everyone. Hey everyone, Scott Ritzheimer here. Thank you
• 15:44
  so much for listening to the Start Scale and Succeed podcast.
• 15:47
  I hope this episode gave you exactly what you need for the
• 15:51
  level you're in right now. If you want to discover what level
• 15:55
  you're in, take our 10 question Founders Evolution quiz for free
• 15:59
  at foundersquiz.com. That's FoundersQuiz.com. It'll pinpoint
• 16:04
  exactly where you are and give you tailored tips to move
• 16:07
  forward and reach that next level in your journey as a
• 16:11
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• 16:14
  forget to subscribe, rate, or review. It helps us reach more
• 16:17
  founders like you, and let's be honest, it means a ton to me, my
• 16:21
  team, and all our incredible guests. So keep starting,
• 16:25
  scaling, and succeeding, and I'll see you in the next
• 16:28
  episode.