Sales of the Early Retirement Masterclass (ERM) has breached the $1 million mark, three years since I went down this path. While this pales against folks who launch new cryptocurrencies, this is the first in my life where I get to build a product, sell it in person and then deliver it to customers before I can get paid.
I’ve built my ERM to disrupt the training industry:
- The trainer invests in student-built portfolios. If the training is terrible, the trainer suffers because he has not taught the program well. This feature is only possible if the trainer is, himself, financially independent.
- Every student portfolio is tracked, and overall, XIRR is published. There is no luxury of cherry-picking successful clients and ignoring the rest. Fortunately, returns have doubled that of the STI ETF so far.
Still, a lot of what ERM achieved today was luck and excellent timing.
But here are some things I got right:
1. Improving the course content with realtime students feedback
Dr Wealth collects direct student feedback instead of well-polished positive testimonials. And the first three batches of students were the hardest because the feedback were ruthless. I’ve had experience dealing with negativity in the workplace, but when it involves your own product, it hits you harder.
Fortunately, Dr Wealth captured and dispassionately administer it to me without any sugar-coating.
Being a trainer isn’t just about regurgitating what I know works for me.
Almost immediately, I was told no one wants to pay for a course that asks them to budget their finances and upgrade their careers. Students want to know what goes on in an investor mind when they buy a stock. Even though extreme savings was how I attained my financial independence, I had to move those lectures online to improve my product.
When the course hit its lowest point, I went as far as to revise my REITs slides and re-executed the lecture to paying customers without renumeration.
2. Resilience trumps efficacy
The course’s lowest point was in March 2020, when high net worth individuals were facing margin calls on their REIT portfolios. We had to deleverage quickly and decide how to play the market recovery. Thankfully, we had overcome our bout of underperformance since.
The ERM portfolio, even accounting for the batches before March 2020, have done twice as well as the STI.
Fortunately, the course has staying power because it is dividends driven with a value bias.
I tested the portfolio recently and found that ERM portfolios are the opposite of growth portfolios. As it tumbles, the odds of a mean reversion become higher, and investors can put more money to make a higher return in the future. Conventional growth portfolios are momentum-driven and tend to drive lower during a period of underperformance.
Interestingly the course revenues are also resilient and built the same way. The pandemic has ignited more interest in the course than usual, and every lockdown results in higher sales.
3. You choose your customer as much as the customers choose you
Just like how we manage our portfolio, investment courses cannot afford to remain static. As financial markets change, so do the dominant factors that drive market returns.
We began to look at the macro-economy, forensically examine market indices, and even dive into OTC bonds to improve students’ decision-making. As the time required to refine and run the program expanded, the price adjusted upwards.
Something interesting happens when prices go up – profits improve, but so does student quality and engagement. It became more pleasant to conduct a program because only students who are philosophically aligned to the trainer would invest in their training.
Consequently, the ERM previews have sustained themselves through consistent messaging, explicitly avoiding references to fast European cars and expensive travel holidays generally employed from the toolbox of inferior internet marketers of the 1990s.
4. Find a solid partner to complement your weaknesses
Full credit goes to Alvin Chow’s fantastic team at Dr Wealth. Every well-meaning “consultant” who reviewed my business model has told me to ditch Dr Wealth and keep all my profits to myself. Every time, I tell them to shove it because that’s not the way we repay our benefactors. Why?
A large part of the business is not to do the stuff you are bad at. At a law firm, I knew that I sucked at detailed, meticulous work. So I made sure I had a partner to take on the repetitive stuff. Dr Wealth took care of the marketing copy, email blasts and tracked the database of customers, something which I did not want to do. They knew the business of investment training and shortened my learning curve.
I’d probably not be able to achieve this result without their support.
How I graduated from law school but ended up as a trainer
To celebrate meeting the $1M target, I thought it would be interesting to share some origins about the program. Hopefully, readers who learn this one data point can apply it to their own lives.
There was a lot of diarrhoea and vomit when I started working on ERM slides the first time in 2018. After consuming some Chendol, I developed a nasty bout of food poisoning, but had to crawl back to the law firm where I was doing my pupillage to assist in a hearing. I did my best while running off to the toilet to puke, but I was told off by the law firm staff—all for $600 a month. I then decided that family law practice was not good for my well-being and started drafting my ERM slides every night after returning home from work.
Eschewing legal practice was hard. The opportunity cost of law school was $480,000 of forgone salaries plus about $70,000 of school fees. And, I have to contend with the idea of being the sole failure at a SMU reunion many years down the road.
So I had to win big within three years of becoming a trainer or disappear from future class reunions.
ERM will keep evolving
This first $1 million is only the beginning.
I hope what they say about the first million being the hardest holds true in this business.
We continue to evolve with more video content, and I’ve started an introducer service with iFast to let them invest in an ERM-inspired portfolio.
