Let's just start with a maybe provocative idea.
The traditional AI automation agency. It's fundamentally
a trap. It sounds like a strong statement, but,
you know, we're watching this happen. The market's
going through this great commoditization. It
feels very much like the travel agent story maybe
20 years back. Yeah, that's a great parallel.
You just can't survive anymore by only selling
the technical workflows. You got to stop selling
the how. We've seen it, haven't we? That $25
,000 custom AI dashboard project. It didn't fail
because the tech was bad. Not at all. Right.
It failed because the client, well, they wanted
internal ownership. They didn't really see the
agency as like a strategic partner, just a builder.
Yeah. A tool builder. And that failure, that
specific story, it really. points towards a completely
different way of operating, doesn't it? Absolutely
does. So today, we're going to dive deep into
exactly that, a new playbook. And this isn't
just theory. This model, it's being used right
now by successful folks out there, people like
Jack Roberts at Teddy AI. They're pulling in
over $100 ,000 a month because they radically
shifted how they present their value. So our
mission for you today, listening in, it's pretty
straightforward. We're going to unpack why that
old agency model, why it's kind of failing now.
Then how you can sell real. quantifiable commercial
value we'll talk about the critical three framework
for that and also why getting really specific
like laser focused with your niche this kevin
bacon strategy idea why that's so essential for
getting referrals and then finally we'll lay
out the four key components you need to build
your own sustainable ai operating system sound
good let's do it okay let's dig into this technical
trap first so many people jumping into ai services
now even some established firms They're still
leading with the tech skills, you know, building
these really complex, maybe elegant workflows,
connecting APIs, making things talk to each other,
like stacking digital Lego blocks. And look,
a year or two ago, that was valuable, really
valuable. But that value, it's eroding fast.
We've seen this movie before, like you said,
with the travel agent. Exactly. The travel agent
parallel is perfect. Their expertise, their knowledge
of routes and hotels, that was gold because getting
that info was hard, scarce. Until the Internet
basically blew that wide open. Yep. Expedia,
Google. Suddenly everyone had access. That core
knowledge got commoditized. And now the same
thing, but maybe even faster, has happened with
AI automation. Building these workflows is getting
easier, or at least perceived as easier. Right.
The tools are getting so user -friendly. Make
.com, Zapier, all these things. They make it
look easy to the client, even if it's not always
simple behind the scenes. And that perception
gap, that's the real danger here, isn't it? Because
we know, you and I know, the complexity is still
there, especially when you need it to be robust,
reliable, scalable. Oh, yeah. Getting from zero
to, say, 80 % of what you need. Often pretty
straightforward now. But that last 20%, go from
80 % to 100 % reliable, that's hard. Building
a truly solid system. That's the tough part.
And often that last 20 % involves sophisticated
stuff like large optimized systems. Okay. Maybe
let's quickly define RG for anyone listening.
Sure. RG, it just stands for retrieval augmented
generation. Basically, it's a fancy way to help
AI use your specific documents, your external
knowledge reliably. So it pulls accurate facts
instead of, you know. Making stuff up. Hallucinating.
Exactly. Stops the hallucination problem. And
building that well, that's complex. Clients often
don't see that complexity. And adding to all
this is, well, the market's gotten a bit skeptical,
hasn't it? After a couple of years of hype and
maybe some amateur experts overpromising. Totally.
Lots of failed projects, unfortunately. It's
made businesses quite wary. They've been burned.
So here's the core question then. If that technical
skill, the building part, is becoming a commodity,
what should AI practitioners sell instead? How
do you survive this shift? You have to shift
your focus completely. Away from the tech, towards
commercial, quantifiable outcomes, and crucially,
towards becoming a strategic partner. That shift
from just being a vendor to being a real partner,
that's the secret sauce for landing those bigger,
long -term contracts. I know this consultant,
right, just landed a deal worth about $72 ,000
a year. It's a two -year contract. Wow, okay.
And it wasn't because the tech solution was some
kind of magic bullet. Nope. It was secured purely
because he had commercial acumen. He could talk
the talk. The ability to translate the tech jargon,
RE, fine tuning, whatever, into the language
the CEO understands. Dollars and cents. Risk
reduction. Exactly. So many agencies, they fall
into this trap of selling the flights. You know,
talk features. We use this ROG system. Look at
our cool agents. But clients, they don't buy
flights. They buy destinations, right? Yeah.
If you're selling lawn care products. They sell
the beautiful green lawn. Not the grass seed.
They just want the transformation, the end result.
That's all that matters. I have to admit, though,
it's sometimes really hard to resist showing
off the cool tech stuff. You build something
elegant. You want to explain it. Oh, tell me
about it. I still wrestle with that temptation
myself, honestly. Yeah. You want to lift the
hood and show the engine. Yeah. But you just
you got to fight it. Sell the destination always.
OK. And that's where this critical three framework
really comes in handy. Think of it like your
one page sales cheat sheet. It keeps you focused.
All right. So break down these three levers,
the ones that actually close these high value
deals. What are they? Okay. First, new revenue
opportunities. This is straightforward. How does
your AI solution help the business make more
money? Does it increase capacity? Open new markets.
Find new leads. Direct line to revenue. Makes
sense. What's number two? Second, time savings.
But crucially, this has to be quantified, like
really rigorously. Don't just say it saves time.
That's weak. You need to say, look. This saves
your team 80 hours per month. At your average
employee cost of X dollars per hour, that translates
directly to $8 ,000 in hard labor costs avoided
every single month. You turn time into dollars.
Concrete numbers. Got it. And the third one,
the one the source material says gets ignored
all the time by newcomers. Ah, yes. The secret
weapon. Risk and compliance. This is huge EE,
especially when you're targeting serious established
businesses. Mid -sized firms, large corporations.
For them, safety, legal compliance, operational
stability, these are non -negotiable. For its
table stakes. Absolutely. Think about, say, a
law firm or a financial services company, an
AI that can review contracts and flag potential
regulatory issues before they become problems.
That's potentially saving them hundreds of thousands,
maybe millions, in fines or litigation risk down
the line. So positioning your solution as mitigating
risk. It transforms the conversation. You're
not just a nice -to -have efficiency tool anymore.
You become essential, like an insurance person.
policy embedded in their operations. Okay. That
completely reframes the value proposition. It's
not just about speed or cost. It's about safety
too. It does. Hugely important. So if the tech
is commoditized and we need to focus on these
commercial outcomes using the critical three,
why isn't just focusing on outcomes enough? Why
the need for super sharp specialization on top
of that? Because being a generalist in this space,
it's basically a death sentence now. You absolutely
must specialize to become instantly referable.
Look, having a really clear, defined niche, it
acts like an automatic referral engine. The data
we're seeing suggests that for these high -value
AI firms, something like 80 % of their early
clients, they come directly from referral. 80%,
wow. But that only happens if people know exactly
what you do. If you're just the AI guy or we
help businesses use AI, you're instantly forgettable.
Who are they going to refer you for? Anything.
Nothing specific. Which brings us to this idea
you mentioned, the Kevin Bacon strategy. Yeah.
Explain how that applies here as a fun analogy.
Yeah. It works surprisingly well. You know the
six degrees of Kevin Bacon game, right? Sure.
It's all about connections. Yeah. A generalist's
network kind of grows linearly. Maybe they tell
a few people. But if you have a razor sharp,
super specific niche, your brand gets plugged
into the network effect. Exponential growth.
Here's the test. Ask yourself this. If your five
closest friends or maybe five key business contacts
were asked exactly what you do professionally,
would they all give the same consistent, specific
answer? Ah, okay. So if the answer isn't something
really concrete like, I don't know, oh, she's
the expert in AI -powered lead scoring for sauce
companies or he does the WhatsApp automation
systems for dental practices. Ew. If it's vague,
your niche isn't strong enough. Exactly. It needs
to be that specific because that kind of clarity
means those 100 people in your immediate network,
they suddenly become access points to maybe 10
,000 people in their networks. And when someone
in that wider network had that specific problem,
your name is the only one that comes up. Right.
You become the go -to person for that one thing.
That's the multiplication effect. That's the
power of clarity. So choosing that niche. It
sounds like maybe the single most important strategic
decision you make early on. The sources mention
four pillars for picking a good one. Let's walk
through those. First one, specific and easy to
explain. Yep. Use a simple formula. I help X
your specific client type, get Y a specific quantifiable
benefit. Keep it tight. Like your example, helping
real estate agents get 20 qualified leads per
month using AI. Clear promise. Easy to repeat.
okay pillar number two target clients with more
money than time this sounds Blunt, but probably
necessary. It is. It's about discipline. You've
got to consciously avoid the clients who are
going to arm wrestle you over 500 pounds, as
the source puts it. Aim for high -income professionals
or larger businesses. We're dropping $10, $20K,
$50 on a solution that genuinely saves them significant
time or reduces major risk. It's a no -brainer
investment for them, not a painful cost. But
that discipline must be tough, especially when
you're just starting out, right? Saying no to
smaller, easier gigs. Oh, it's incredibly tough.
But the sources argue, and I think they're right,
that if you get bogged down in those low -value
projects early on, you just get stuck in that
commodity mindset. You never escape. Which leads
nicely to the third pillar, leverage your 1 %
skill set. This is about using what you already
know. Exactly. What's your unfair advantage?
Did you spend 15 years in logistics or healthcare
administration? Education. Whatever it is, that
deep industry knowledge, that's gold. You already
understand the nuances, the jargon, the real
pain points of that industry way better than
any generic AI consultant ever could. Lean into
that. Makes sense. Don't start from scratch if
you don't have to. And the final pillar. Pillar
four, deep problem understanding. Once you have
your niche client, X, and your unfair advantage,
you need to build your entire business. Your
content, your marketing, your actual service
around solving the top, say, three problems that
genuinely keep those clients awake at night.
What are their biggest operational headaches?
Focus relentlessly on those. Okay, that makes
a lot of sense. Niche down, focus on high -value
clients, use your background, solve their biggest
problems. But what about proof? new firm they
need case studies testimonials how do you get
that crucial first bit of credibility ah great
question for that very first client the playbook
suggests using what they call the ban strategy
ban by any means necessary okay Tell me more.
This involves the free client strategy, doesn't
it? It does. And look, this isn't about working
for free forever. It's a very specific strategic
investment. You find that ideal first client
in your perfect niche, and you offer to do the
initial project either for free or maybe just
at cost. Why? Because your payment isn't cash
right then. Your payment is a killer case study,
detailed metrics, quantifiable results, and a
glowing on -camera testimonial from that happy
client, that documented success story. That's
worth far, far more than that. the fee you gave
up initially. Because it lets you leapfrog the
credibility gap. Exactly. It lets you immediately
start pitching those high ticket $10K plus projects
to subsequent clients because you have tangible
proof that you deliver results in their specific
world. It's an investment in your future pricing
power. Okay. That's a clever, if maybe slightly
scary way to kick things off. So once we have
the niche dialed in and we've maybe got that
first crucial case study. What's the actual blueprint
for building this recurring revenue system, the
sustainable model? Right. You need a structure.
The playbook lays out a really clear four component
model. And it starts, interestingly, not with
sales calls, but with media and then a structured
paid diagnostic phase. All right. Let's map out
this four part structure. The sources are calling
this the 2026 success formula for AI businesses.
Component one, media. Two, diagnostic. Three,
transformation. And four, recurring revenue.
Walk us through it. Okay. Component one. Media
and content. This is about building a brand,
not just, you know, a service business. You need
to be putting out free, genuinely valuable content.
Think LinkedIn articles, maybe YouTube videos,
webinars, whatever fits your niche. And the key
is that this content is laser focused on solving
problems for your specific niche avatar. But
precisely. You're not trying to reach everyone.
You're demonstrating your expertise to your ideal
clients before they even talk to you. And the
leads that come from this kind of content, they're
already warm. They kind of know you. They trust
you a bit. The sales conversation is way easier.
Okay, that makes sense. Build authority through
content. What's component two? This is where
the shift really happens, you said. The diagnostic
model. This is critical. You have to stop acting
like a salesperson pushing a solution and start
acting like a doctor. You sell a paid diagnostic
or audit. This might be a one week, maybe up
to a four week engagement. Paid. So they pay
you before you even propose the main solution.
Yes. And the goal of this diagnostic is to genuinely,
deeply understand the client's internal processes,
their workflows, their real bottlenecks. Here's
the thing. Many businesses don't actually understand
their own operations that well. Your audit maps
it out for them. So the output of this paid diagnostic
is valuable in itself. Immensely valuable. But
here's the crucial step. The report, the output
of that diagnostic. It absolutely must be organized
by ROI, return on investment. Okay, what does
that look like, organized by ROI? It means you
don't just list problems. You list potential
solutions or improvements. And for each one,
you estimate the likely cost to implement, the
time to deliver, how long it will take, and most
importantly, the expected value or financial
return. Quantified. Ah, so the diagnostic report
itself becomes a clear, prioritized blueprint
for action. It shows the client exactly where
the biggest bangs for their buck are. You got
it. It basically sells the next phase for you.
Whoa, okay, I can see that. Imagine scaling a
system where the diagnostic itself is this highly
valuable paid product, and it inherently builds
trust and naturally leads the client to the next
step. That's powerful. It is, because it leads
seamlessly into component three, transformation.
The client has paid you for the blueprint. They've
seen the ROI calculations. They trust your analysis.
So the natural next step is for them to pay you
to actually execute that plan, to implement the
solutions you identified and take them from their
current state to that optimized future state.
The actual building and implementation phase.
Right. Based on the roadmap, they already paid
for and approved. Okay. And finally, component
four, the one that makes it sustainable, recurring
revenue. Yep. Once the main transformation project
is done, you don't just walk away. You need to
build in long -term revenue streams. We're talking
those $3 ,000, $5 ,000, $10 ,000 plus monthly
contracts. And what are those typically for?
Maintenance, support. It can be a mix. Ongoing
maintenance and optimization of the AI systems,
yeah. dedicated support hours, but also potentially
things like specialized training or education
platforms to help their team use the new systems
effectively. Maybe access to ongoing updates
or new features. It locks in the relationship
and ensures predictable income. Got it. So media
builds awareness, diagnostic builds trust and
the plan, transformation executes the plan, and
recurring revenue sustains the relationship and
the business. That's the flywheel. Yeah. But
success hinges on avoiding those pitfalls we
touched on earlier. Remember, don't fall back
into the technical trap. Stop leading with features.
Avoid the commodity mindset. Don't compete just
on price. And always resist the solution -first
approach. Diagnose first, then prescribe every
time. So if we zoom out, the really big idea
here, the fundamental shift, is moving away from
just being a transactional vendor selling AI
tools or one -off projects and moving towards
being a consultative strategic partner. This
whole four -part system we just walked through.
Media, diagnostic transformation, recurring revenue
creates this powerful flywheel. It's what builds
a scalable, resilient, high value business in
this space. So the old way was kind of selling
generic tools, doing one off projects, maybe
positioning based just on we know AI tech. Yep.
Competing on features, often getting squeezed
on price. Very precarious. And the new way is.
Selling clear commercial outcomes. Leading with
that paid diagnostic to build deep understanding
and trust. And having that laser sharp niche
specialization that makes you the obvious, instantly
referable choice for a specific problem. That's
the path forward. Success in this market, especially
as it matures over the next couple of years,
it's absolutely going to belong to those who
make this shift now. Those who focus on delivering
transformation and building those real strategic
partnerships. So maybe a final thought for everyone
listening to Mull Over. Forget the tech for a
second. What is the single biggest, most painful
operational bottleneck that you know keeps your
ideal niche client awake at night? Start right
there. Think about how you could apply that critical
three framework revenue, time savings, risk mitigation,
directly to solving that specific pain point.
And then start sketching out what your paid diagnostic
offering could look like for that problem. It's
time to move beyond the commodity market. Now
is the moment. Well said. Thanks for joining
us on this deep dive into the AI operating system
playbook. Hope it was valuable. Outiro music.