Hijacked to Half a Mil: Scaling Despite Lawsuits and Lockouts

In business a handshake can turn into a hostage situation and then into a failed business FAST…

In case you’re new, My name is Lance C. Greenberg this newsletter serves as an insider's view on traffic, sales, systems and strategy in companies looking to scale to 7 and 8 figures.

All of the names and details of my clients stay hidden not just due to NDA’s but because I want to keep their info private.

The results my clients get are NOT typical. The results discussed in this newsletter are not typical.

I'm not a "typical" guy in general.

I do not in any way shape or form suggest you will get these results by doing anything I ask my clients to do or suggest in this newsletter.

Now that we got that out of the way, Here’s some info about the offer I was working on:

Pricepoint: 50k investment

Results according to Hyros as of 12/15/23 2:09 PM EST

Total Revenue:
$500,000.00

Total Tracked Sales:
$400,000.00

Total Tracked Cost:
$98,240.09

This is just the rev that came from ads.

Here’s a screenshot their team sent me:

This story takes place over the course of months (see dates in the images above and below) with 400k of the rev produced just in the past month and a half. You’ll discover why later.

Date of signed agreement:

It is my intention to share with you how missteps and challenges could have been avoided.

This client has a successful product with happy customers, but due to working with some bad vendors, partners and contractors this offer could have died on the vine.

Props to my amazing client who didn’t give up, and who believed in their product so much that they were willing to go through everything I’m about to share with you to see it live and grow.

• **** (name hidden) Reached out - ad team isn’t working out. Strategist they hired doesn’t seem to know what he’s doing.

I did my audit…

After breaking down numbers, previous to seeking out my guidance, vendors haven’t even spent enough on a single campaign to get 1 sale.

Ad team and strategists had never spoke about or shared a model with KPI’s.

The entire team didn’t understand what their CAC should be, didn’t have real KPI’s, didn’t have a model to work out of, or a decision making system.

This means no way to set shut off rules or rules for deciding when to scale ads.

Something I ALWAYS look at when hiring someone is if they work off of models or just pull numbers and ideas out of their ass.

When you work off of a model it gives you the ability to know where the kink is in your entire funnel.

In the ads if you’re hitting 100% of your target KPI you should be able to scale (cost per booking in this case).

That’s not where the analysis stops however.

CPB is only 1 of MANY indicators you look at.

You must also look at applicant quality score and KNOW for certain which variations of that number works with the entire model (all the other numbers).

Then decide how far you’re willing to go outside of your target CAC to get things working.

Generally when you’re hitting 100-150% target CPB (Cost Per Booking), and hitting an acceptable quality % (based on the model) but not hitting your target CAC (Customer Acquisition Cost), there’s some kind of sales issue.

Then you want to look at the show and close %.

These would all be based on 3 variations of a model to understand what numbers and in what combinations would work.

Ever put together one of those puzzles that have over 100 pieces?

A model is like the image on the puzzle box.

It’s your guide to know if you’re getting closer to your outcome or not, or where you’re going wrong.

I had this client’s team create 3 variations and plugged in baseline data based on my experiences.

Sometimes baseline data is wrong because it’s formed completely out of an industry standard, random guru advice, past experience, and/or bias.

For example I can show you a model where a 6% optin rate works, yet everyone says you have to be hitting 20%+.

I use a spreadsheet like this one with clients to create models.

I also use a tool named Geru. It shows more granular data with the funnel and email.

Here are a few simulations you can check out to understand what I’m talking about. Just tap the simulation button at the bottom right hand corner.

You'll need to view this on desktop or a tablet.

Model 1 (has a 4.49 roas with 6% opt in)

Model 2

Model 3

Finally, Here’s a video covering some of this info in my Facebook group. 

If you have an acct you can have my funnel here 

Point is, there was no model being worked from.

As soon as I knew that,

It was clear that the entire strategy was built on bias, regurgitation, and sand.

If you have questions about any of this just reply to this email.

If you stopped reading now and JUST implemented this, it was worth the read.

The next issue though is a doozie, and reading about it could save you some serious misery.

It happens a lot and it puzzles me as to why no one ever talks about it.

• Previous team is holding website and creative hostage

  • Had the client review his contract he had with his vendors and share with his lawyer.

  • Even after seeing that the vendors should indeed give up the assets they drug their feet.

I personally can’t stand wasting time. I think it’s a crime to waste someone’s time.

The client and various team members trying to get their assets back was a huge drama.

Lots of back and forth.

The vendors they used owned everything and did not want to give it back.

NEVER work with someone who owns any of your assets unless you are business partners.

Do your due diligence when working with someone in business.

Ask lots of questions.

Take your time and get to know how they think.

Case studies and resumes do not show someone’s true bias, patterns, ability/inability to get results, or how they handle stress.

Most testimonials are situational or someone well known giving a high 5 to their friend in a mastermind with them who gave them advice.

If it sounds too good to be true, then it probably is.

In many cases vendors and bad partners end up owning valuable and precious assets that are worth money.

• Email & Text Lists

• Pixel

• Ad accounts

• Creatives

• Funnels/websites

• Intellectual property

• Etc

All assets.

I advised my client we need to not wait for assets to be returned. 

It’s one thing for someone to waste your money, but wasting your time that you can’t get back is another.

I personally can’t stand wasting time. I think it’s a crime to waste someone’s time.

Besides, I had 0 interest in the creatives, funnel, or even the website that was used previously.

It’s clear nearly everyone on the project had no idea what they were doing even though they all had track records of success.

• Connected client with someone in my network who is elite and has integrity to fix website hosting issues (hosting also owned by previous vendors)

• Advised them to create a copy of it so there’s a template and get a different domain

• Connected client with an all star advertising company that I advise and own a significant stake in. this team writes the copy, edits all the videos, builds the funnel, writes email, manages the ads on multiple platforms, understands sales, and understands business. Hard to find. 

Important to note that in all relationships I am an unbiased advocate for the client. I’ve found using companies I own gives me more leverage and control to hit the outcome faster.

• Advised client to re-shoot all creatives with new scripts

Ever played the game telephone?.. Happens in a lot of businesses and it’s expensive.

Communication issues erupted.

Various members of the team would text me or invite me to perform tech tasks.

They were all communicating in multiple channels.

Some were private.

Others only had a few team members.

I continuously repeated that all communication needs to stay in the channel where all team members are.

If you can’t get the communication in 1 spot for everyone to see, you’re going to have some serious communication overhead.

It creates a relay of information.

It also creates data loss from 1 person to the next.

Ever played the game “telephone”?.. Happens in a lot of businesses and it’s expensive.

Just calculate how many calls and texts that happen. Add up all the time.

Then add up the hourly wage from everyone involved.

It’s KEY in business relationships to have a CLEAR agreement, boundaries, and roles. 

If you don’t, people will get confused, resentful, and leave.

Now you have the cost of all the wasteful communication + the cost of employee and vendor churn.

You may not have these things all the way fleshed out, and that’s ok.

It’s normal starting out. Just ensure it doesn’t stay that way.

When I work with partners and clients I’m always asking “who owns that?”

When an issue pops up I send a bullet point and ask a team member to complete it and turn it into an SOP so this problem doesn’t persist.

Anytime something is repeatedly done, asked, brought up or an issue I advise them to turn it into an SOP and a recurring task in their pm platform.

Doing this will help clear up a lot of confusion around time too. 

Most businesses think their team has 8 hours a day, yet don’t factor in all the meetings, check ins, and recurring tasks. 

I’ve done audits before and found that team members on the chopping block were actually high performers, but that their superiors weren’t 100% clear on all of the tasks this person was doing.

1 off tasks and recurring tasks that aren’t brought up on calls or laid out in any of the projects add up. 

I like to use scribe ai for SOP’s. Makes it very easy by capturing your screen. 

You can record with LOOM at the same time to knock both out at the same time.

Here’s my affiliate link if you want to try it out

Facebook is no different, or any other platform for that matter. Their entire goal is to keep buyers on the platform coming back.

While assisting the team in getting up and running, I was met with another unpleasant surprise.

Their “strategist” set the client up with a “rented ad acct” where my client is paying a % of spend just to have the acct.

They did this on the tail end of the relationship.

Another asset my client doesn’t own.

Despite this I advised the team to launch.

The ads kept getting shut down. 

Ad account rental companies charge you a % of spend and will replace your supposedly “warm” ad accounts if they get shut down. 

Not only do you pay them a % of spend, you also have to do “top ups” and stay on top of keeping money on your account. 

I HIGHLY recommend never going this route unless you absolutely must. Still not 100% clear on why this was done. 

Ads getting shut down due to payment issues can degrade audience quality.

Here’s how.. 

View the ad platform, specifically facebook as a mall. What do the mall owners want? 

They want BUYERS to show up to the mall and have a great experience so that they come back to the mall and buy more stuff. 

The mall wants to make money on all of the vendors and rent. In order to do that they need buyers to keep coming back. 

People only come back if they’re happy. 

Part of this equation is ensuring the businesses follow certain rules. Without going deep into it, the main thing is to do good business. Don’t scam. Be compliant. Sell things people like etc.

Facebook is no different (or any other platform for that matter). Their entire goal is to keep buyers on the platform coming back. 

The AI is the judge of this and scores you accordingly. 

If there are any signals at all sent to the AI that you’re scammy, not doing good business, or not meeting basic requirements that a good business meets then it’s a red flag.

There are many other signals like people hiding your ads, reporting you, low engagement with your ads and anything that signals a bad experience with buyers.

The ads weren’t terrible.. But NOTHING is worth a lawsuit.

What you must understand is this: Not all interests and audiences are equal.

Just because you target “business owners” does not mean they are all high income buyers.

Facebook and other platforms such as google know more about you and has more data points on you than you know about yourself. 

The ai will purposely stop showing top tier buyers your ads if there’s a risk of them coming back.

There are other things that trigger this that I cover in my facebook group and content. The main thing that happens here is costs go up and lead quality degrades.

I educated the client, had them put together an SOP for top ups, and ensured someone owned this task.

As soon as we began spending consistently there was yet again another problem..

I reviewed some of the new ads in QC and I wasn’t very happy with them.

It felt like things were moving toward a direction that wouldn’t be compliant with the FTC.

I told the team to pause all ads and called for a meeting about compliance.

The ads weren’t terrible.. But NOTHING is worth a lawsuit.

Here’s a FTC guideline checklist my teams, partners and clients use.

I am not an attorney and this is NOT legal advice. I’m not stating that this checklist will ensure you don’t get in trouble with the FTC.

Seek legal counsel from an attorney and do your own research on this subject.

• I recommend the client use an ad acct they own. This would increase profitability. It was also my goal for them to own as many 

• Around this time rented ad acct company scams client for 7k. Not going to go to far into detail on this, but consider what you’re getting into when working with a company that circumvents the system.

• I find out clients business managers are connected to their client ad accounts, I tell them it’s not worth the risk. If the business manager got disabled because of another ad account it could impact them all.

• Client has challenges with new business page and ad acct. Can’t get it verified or up and running

• Finally we get it up and running with limited spend.

  • Facebook will start you at 50 dollars a day with new ad accounts. Getting your business verified and running ads over a period of time can fix this.

  • Here’s a resource for that

At this point, I personally give the client an ad acct connected to a business manager I’m not using. 

Back in the day I took getting as many ad accounts and business managers seriously and got as many as a could. If you have the ability to do this, then do it. You can have family do this as well.

I really shouldn’t have used one of my own ad accounts. This isn’t a company I own a piece of. I collect a retainer + incentives on this specific project.

I believe in my client and their product however..

I also understand jobs and money are on the line.

So I made a move and made something happen for the whole team.

Meanwhile they’re working on getting their own ad acct up and running.

Because I own the ad acct where all the traffic is being run by their ad team and I can’t transfer it.

They own the pixel, list, website and funnel though. Eventually I will advise them to migrate all spend to the ad accounts they own once the ad team tells us it’s spending more than 1k a day.

Think about all the time and money you will lose shooting more videos. I’d rather just edit ad copy and test images to get proof of concept.

FINALLY there’s good news!

Two deals come in from paid traffic (cold).

So I advised them to test the ad VSL on facebook. 

If it works, move it to youtube.

I would have liked this to have happened faster, but I shot down all the previous videos due to my compliance review.

To be fair they weren’t horrible and I've written far worse much earlier in my career.

My views have changed over the past couple of years with all i've experienced and learned. So I am very conservative and somewhat paranoid in this area. 

My main point here… 

Look at all the work that got put into a video that ended up needing to be changed. Let’s say it has nothing to do with FTC but that it was a failed creative. 

Think about all the time and money you will lose shooting more videos. I’d rather just edit ad copy and test images to get proof of concept.

I’ve since updated all of my advice and processes in the companies I have stake, rev share, or my hands in any way to reflect this.

• Advised client to add youtube since they have POC (proof of concept) from cold traffic.

I almost always advise clients to get facebook profitable first. It’s faster. 

For example the best performing creative was an image. It took a graphic designer 15 minutes to put it together. 

The team tested a handful of hooks with the same offer and some headlines. 

Their team launches the proven VSL on youtube and it takes off

Youtube can take a little more time.

It entails shooting videos and someone doing hours worth of editing. Shooting video itself means using a teleprompter, practicing a script, making sure lighting is good… and a handful of other things.

Google itself is slower than facebook all around.

• Youtube became profitable faster than usual. 

The product is super solid though with tons of reviews.

When you have a great product and can articulate to your team why it’s great and why it’s different than competitors, it becomes very easy for them to sell whether it’s with an ad, email, or sales call..

Whenever there is success, I expect resistance and negativity to pop upI do this so that I’m not surprised.

I hedge against whatever I can foresee,

But never thought a lawsuit would pop up, causing the closer to become discouraged.

Remember what I said about moves that could cause lawsuits not being worth it?

Unfortunately before getting my help this client was lured into one of those “bolt on” closer programs.

Willingness to invest in shiny objects and ideas, but not heavily in their in house sales process is like buying special fertilizer and genetically modified seeds for your grass but being unwilling to pull out the hose and water it.

Basically the company had an inhouse team of closers.

Their sales reps were saying and doing unethical things on the calls (and closing deals because of it).

They were given too much trust too fast.

Usually these companies are selling multiple offers and they charge 20% commission. IMO it’s not worth it.

Recruiting setters and closers is one thing.

The hardest part of the entire thing is listening to sales calls. Which is something that MUST be done routinely.

The remedy in this specific situation was to connect my client with someone in my network who specializes in reputation management.

Google knowledge panel, articles, etc.

It’s my opinion that it will help position my client as a thought leader in their space.

Since I’ve found most people are going to google you when the investment is 5k and up.

This gives them the ability to teach people how to think about investing and showcase their long track record of building successful businesses and helping their clients in whatever venture they’re in.

In an ad you don’t have a lot of time to explain to a person that you’re not a scammer and actually do have real success.

You can try to explain, but it takes touches over time IME.

I like to accelerate that by having an ecosystem of proof and information.

One thing you must understand is history repeats itself.

In many people's lives and all throughout history you can see a common thread.

For this client it’s building assets they don’t own and other people hijacking them.

So I advised them to build things that create thought leadership for future offers and scale. 

Important to have an audience that knows you and trusts you regardless of what platform you’re on.

Audience and attention is a currency.

In the future with all of the information and AI it’s going to become more important.

A Lot of unqualified folks are slapping together courses and running direct response ads.

Consumers trust a lot less knowing that.

In 6-12 months my client will thank me for this move because their audience will be an asset they “own” rather than something a specific platform or person owns.

To boost moral I made a bet with their team that I’d wash the media buyer’s car if they hit a certain benchmark.

The jury is still out on that.

When you scale success, you also scale your mess.

There’s still an emphasis from me to work on personal leadership.

Your success will never surpass your personal growth ceiling. If it does, it will balance back out. That’s how the universe works.

Results are not always linear in that way.

Notice we worked on models in the beginning.

There was a lot of mental model and mindset work in the beginning of this relationship as well.

This is why my program is “Growth & Scale Advisory”

Personal Growth comes before the scale, if you’re lucky.

If you’re lucky you fall flat on your face before you scale.

Otherwise, what are you scaling?

When you scale success, you also scale your mess.

If I can put my finger on one thing that causes massive failure in businesses that were once good, or even great it’s this..

People tend to be in denial because they’ve made money, they’ve done xyz. 

Everyone has personal growth ceilings. If it’s not you right now, it will be soon, or it will be someone on your team.

It’s always sure to rear its ugly head when rev grows.

Another pillar of failure is outsourcing improperly and too early.

Most team successes (agencies, consultants etc) are due to the client ALREADY having something successful.

This client made the deadly mistake of outsourcing everything way too early, and on things they weren’t fully educated on. 

Such as outsourcing to a sales company.

I find that there’s a parallel between the chaos theory example of a butterfly flapping it’s wings and causing a hurricane and business. Things simply don’t work the way we think they do on the surface. It’s just easier to think that way.

That in itself takes some education. It takes some due diligence and thinking about, what’s the worst thing that could go wrong here. 

A bright person right away would say “well the worst thing that could go wrong is they steal our money or say things unethical” and then immediately put things in place to hedge against that.

All of my clients are VERY bright people but we are all susceptible to these things. Even myself. This is why I preach the pause, and Scholars Mate Method for planning and inverting problems.

Always ask, What’s the worst move I could make. What's the risk. What are all the risks? Not just the first order of consequences.

This case for example. The worst thing that could happen was the contracted sales company saying unethical things resulting in a lawsuit. 

However, as a result of that lawsuit It impacted future deals. The impact of future deals will lower sales team moral. Lower sales team moral may mean unprofitable ads. 

This may result in an advertising team making the wrong moves because they may not know the real problem.

That may result in the founder changing their funnel, or something else.

Those are second order consequences.

I find that there’s a parallel between the chaos theory example of a butterfly flapping it’s wings and causing a hurricane and business.

Things simply don’t work the way we think they do on the surface. It’s just easier to think that way.

Client did all this with 1 rockstar sales person. There are many things you can use to grow or scale a company.

Having a great product and having an A player sales team makes all of them a whole lot easier.

Too many businesses rely on unique mechanisms, bold claims, crazy guarantees, and the idea that some piece of software, funnel, marketing thing, or AI will take them to the top.

Willingness to invest in shiny objects and ideas, but not heavily in their in house sales process is like buying special fertilizer and genetically modified seeds for your grass but being unwilling to pull out the hose and water itWrite this down.

B.O.S.S. – Basic, Obvious, & Simple, Scales.

If you’re ever not sure of what move to make next, exhaust the Basic, Obvious and Simple.

Knowing your numbers? Obvious.

Staying the hell away from the FTC? Obvious.

Researching and planning before you take a risk? Obvious.

Just find simple and basic ways to do it.

There's also no guarantees. Any of these things could go south even if you put your best foot forward. So you make an effort to stack all of the odds in your favor. 

If you don't, you're rigging the game against yourself.

Sometimes it doesn’t feel so “simple” and that’s why it’s the job of your coaches, consultants and advisors to simplify things for you and ask great questions..

NOT feed you their bias.

In this case the parties involved before me, took actions based on whatever their fear, bias or incentive allowed at the time, and not on what would protect their client and grow the business.

Until next time..

- Lance C. Greenberg

Btw- if you want me to do an audit and optimize your offer, ads, sales process or any aspect of your business just like I did in this newsletter just reply to this email. Someone from my team or myself will respond as soon as possible.