Arthur Toole - Founder & CEO, SIFT Institute

Who is Arthur Toole?

At his core, when you peel back the layers, you peel back the businessman, you peel back the MBA, you peel back the college degree, you peel back the military experience, he’s a servant.

He truly believes that all people deserve to be financially free and that in order for us to move forward as a society, people need to be able to make choices based on what their hearts desire as opposed to what their wallet commands.

However, the transition from the high school troublemaker to the business owner that serves veterans and civilians was marred with a lot of struggle and a lot of pain. Without a mentor to show him the way, Arthur forged his way forward into the unknown and endured hardships that, if statistics are any guide, should have counted him out.

He failed at three companies, was laid off from his first full-time job and was homeless for over a year. While building his business and pursuing his vision, he had a wife and four kids and was struggling to make ends meet. Nevertheless, he committed to the process understanding that the ability to serve and free people was worth any challenge that he had to face. It is still worth any challenge that he has to face.

That is Arthur Toole.

So is he an MBA? Yes. A businessman? Yes. An investor? Yes. But all of those are only a part of who he is…just one small part.

How did you get started in this business? What inspired you to start this business?

SIFT was started based on me meeting a lady who needed help creating a budget but she didn’t know how. The interesting thing was, I didn’t know how to create a budget either but I like to excel. She said, “You’re pretty smart and you seem like you got a good handle on your money so help me.” And I did. And it turned out well. That was in the late 90’s. And through a series of events including me going active duty in the military, I began to recognize that the need for financial awareness was much broader and much deeper than I’d anticipated. It crossed cultural lines, racial lines, ethnic lines and gender lines. The lack of financial literacy was pervasive from people who had no education to people who had bachelor’s degrees, master’s degrees and PhDs. I knew something had to happen; that I had to mitigate this. So I committed myself to creating the solution that the world needed.

The question was, “How do you implement that to get the result that you want?” And that was the challenge. I spent 15 years doing it the wrong way from taking on clients to provide financial advice to various other things. I finally realized that what people really came to me for was to be taught how to do it themselves. Once I learned that I narrowed my focus and focused specifically on teaching people how to become an entrepreneur, how to financially be successful in corporate America or how to invest. That’s how SIFT was born.

How do you make money?

I make money in a couple of ways. The easiest way is from book sales. I’m a published author. You can find my book on Amazon or on my website and it’s called Don’t Eat From The F.I.G. Tree: How to “Blacklist” Yourself To Become Wealthy. The book contains 36 things that people need to be doing today (regardless of where they are in life) to have a financially prosperous future so that their children’s children can eat off the fruit that they create today.

I also make money from teaching people how to invest and how to be successful entrepreneurs.

Both of these fall under SIFT Institute which I founded. SIFT is a continuing education institute that helps people, through certificate programs, learn how to make money on their own.

The fourth way is through helping build businesses-not just marketing, but everything from operations, to finance, to strategy. I work with small and medium-sized founders who work really hard, but can’t quite get to that next level. I come in and I help them flush out the challenges and then help them get connected to people and places that can help them transition to a consistently profitable business.

I’ve made revenue from public speaking in the past.  I still have regular requests to speak, but it wasn’t until recently that I started accepting them again. I’m entering that phase of life where I think it’s appropriate for me to start back doing it on a regular basis. I’ve had some speaking engagements this year and I’ll start seriously opening myself up to doing more of them in 2018.

How long did it take for you to become profitable?

SIFT became a legal institute in February of 2015. We were profitable as of June of 2016. So about 16 months. We created the business with no debt and, to this day, SIFT has no debt whatsoever. This means we had to go slower. We didn’t have the big fancy building or big fancy anything – but it was the right thing to do.

While is it true that many people never become profitable, many times it is not because of their idea or their efforts. Sometimes, the problem is that when people think entrepreneurship, they think “I have to get these business cards, I have to get these fancy flyers, and/or I have to get the big office space. I have to get this big fancy website” and they spend $10,000 only to find out that nobody’s coming. The first 16 months were spent honing in on what we were good at by giving the class away for free. We then tweaked the results based on the customer feedback while simultaneously building the SIFT name so that people were aware of it. We then spent time figuring out the price point that people would actually pay so that we could be profitable.

Statistics say that 80% of people go out of business in the first 5 years. What are your thoughts about that?

Well I know that’s what the statistics say and I know that’s what people keep repeating, but I don’t actually know if that’s true. The other thing I’ve always questioned was this: when they say fail do they include people who just decided that the idea wasn’t for them and tried something else or do they mean that the company went bankrupt? Let’s assume it’s the latter. I think two popular reasons people go out of business are because of bad handling of finances or a bad product. However, I don’t think those are the biggest ones.

The biggest reason, in my opinion, that people fail in business is because people are product- focused and not solution-focused. So, what do I mean? What these business owners do is they’ll come to the table and say, “I created this lawn mower. This lawn mower is the best lawn mower in the world. There is no lawn mower better than this lawn mower.” And then they go to New York City and try to sell it to people in New York City. Instead, what they should be focused on is landscape. If they said to themselves, “I’m not a lawn mower salesperson, I’m in the landscaping business” then asked themselves, “What problems do people have with their landscape?” Then, if they went to New York they’d realize that New Yorkers don’t need a lawnmower, they need somebody to clean the streets then they would provide that service. Most people don’t do that because people create the product and then they fall in love with the product.

The second major reason I believe that people fail in business is that their why isn’t strong enough. The path of entrepreneurship is mentally stressful. If your why for going into entrepreneurship is because you hated your boss at your old job, you are going to fail. If your why for getting into entrepreneurship is because you want to be a millionaire in 6 months, guess what? You’re going to fail. If your why is so that you can prove a point to your family and friends, guess what? You’re going to fail.

Your why has to be one thing and one thing only. What you’re doing is right. If it’s not that, it won’t be strong enough to withstand the onslaught of adversity that you’re going to face. Unless you’re going to be a hobbyist (meaning you’re going to do it whenever you feel like it) your why has to be strong. If you are going to take entrepreneurship on as full-time commitment, you have to be solution-focused and have a strong why.

When you were starting out, was there ever a time you doubted it would work? If so, how did you handle that?

There are two ways to answer that question. I never doubted that I would eventually succeed… ever. I knew I would. What I have doubted, at times, was if the product or the iteration of the business that I was working on would be profitable. Because those are two different things, I knew that if I committed myself all the way into what I was doing, eventually it would be successful. I knew that it meant that I would have to be willing to change and grow and develop on a continuous basis in ways that I have yet to see and that as long as I was willing to do that, success would come in a matter of time. As long as I was willing to fail, success would come in a matter of time. What I didn’t know and constantly questioned was, “Will people like this product? Will people buy this? Do people really want to hear me speak?” And there’s nothing that you can do to overcome those fears except attack them.

What do you say to people who are afraid to start because they might fail?

People need to expect that their idea won’t work. Your first idea won’t work. Your first idea sucks. I don’t care how great you think it is. I don’t care how great your spouse says it is. I don’t care how great your friends say it is. Your first idea sucks. I don’t care how long you spend in front of that whiteboard writing it rewriting it making it sound great or if you come up with a sexy name. Your first idea sucks. As long as you can accept that, then you have a chance of being successful.

How did you get your first customer?

I am assuming that when you say first customer you mean not my mom and my family.

My first customer was easy because they already had trust in me. They saw the relationship between the product and what I was trying to achieve. Now the 10th customer was challenging because they didn’t know me, but the first few were relatively easy because I stayed in my area of influence. I stayed around my family and friends and said, “Hey I’m doing this now” and people were like, “Okay I like what you’re doing.” After that, it was just showing the results. People need to see the results and then they’ll start buying into it. It may take them some time but they’ll start buying into it eventually if it’s right.

What is one marketing strategy (other than referrals) that you’re using that works really well to generate new business?

Facebook ads and I was not a fan of Facebook ads. I thought it was just a money grab for Facebook, but I am here to tell you that an unfair percentage of our revenue comes from Facebook ads and it’s cheap. An unfair amount of our sales come from Facebook. It’s that simple. Too many people try to make their marketing strategies complicated.  I just realized where the people who I felt needed my services were looking and went there.

What is the toughest decision you’ve had to make in the last few months?

Firing friends has been one of the toughest business decisions that I’ve had to make because I love my employees. I want to take care of them. I want to make sure that their families are okay. I want to make sure that their families get to eat and that their kids are okay. I had to learn that that’s not my job. My job is to make sure that they have the tools to do their job. They will eventually fire themselves if they’re not good enough. The toughest question I asked myself was, “After realizing that a good person is not a good fit, when do you let that person go?” That’s really hard for me because I have had a lot of good people, but they were not a fit for the organization. Answering that question is difficult for me, I’m getting better at it. But it’s still difficult for me to say, “Hey I have to release you.”

What do you think it is that makes you successful?

I follow my gut even when there is no evidence to confirm what I am feeling (there have been mistakes because of this too though, lol) I am just too hard-headed to quit. That is my competitive advantage. There are many people that are out there who are smarter, can do it faster and could do it better, but I will outlast them because I will not quit. I just won’t because I believe that what I’m doing is right. I believe in serving people in a way that enhances their lives and I believe that getting a profit from that is right as long as the cost isn’t unreasonable.

What has been your most satisfying moment in business?

Seeing the light come on in the students’ eyes when they recognize that they no longer are enslaved to a job that they don’t want. I had a lady (I won’t mention her name) who took the investing class while her family was going through a lot. She called me on several occasions crying about how they were struggling financially. She was married, both were working and they were really doing everything they could, but their situation just wasn’t giving them a break. So she was like, “I gotta be successful at this.”

She called me a couple of months ago to tell me that she had doubled her investment account using the strategy that one of my instructors taught her. She later called to tell me that she had quadrupled her account by following the instructions. I was so excited about that.

In this particular class, all of the graduates get together on Saturday and compare notes on what they’re looking at in the markets. So when she shared that, another guy said he did the same thing and literally, just two days ago, we had another guy in a more recent graduating class that did the same thing.

Knowing that I have given them something that they can now take, see, and apply knowing they can be successful with it is amazing.  It is also amazing to see the light come on in their peers’ eyes when they realize, “Oh, this is really possible”. When the instructor says they can do it, they have some level of doubt, but when they see that their peers are doing it, they say, “Oh. I can do it too.” That is the most gratifying.

Another moment was when I met a woman who was really gifted; I mean extremely gifted at her craft, but she didn’t necessarily come from a background of entrepreneurship. I saw her gift and I just gave her advice. I didn’t charge anything, but now she’s walking in it and now, she has multiple clients. She is able to enhance the lives of other people and that fills me with so much joy knowing that the knowledge that I had to fight and scrape to get is now allowing someone else to go out and make other people’s lives better and they get to profit as a result. I live for those moments.

What does the future hold for your business? What are you most excited about?

We are just getting started. I have this three-part idea: Build. Leverage. Enjoy. Be it via entrepreneurship, investing, or corporate, we teach how to create revenue.  Then we teach how to leverage the profits to gain more profits. Then we teach how to enjoy the profits and get set up in such a way that ones’ children and grandchildren can enjoy them as well without having to start back over at ground zero.

For me, SIFT just completed phase zero. We are literally just getting started. The whole point of SIFT is to help people create financial freedom and wealth for themselves. In order to do that, we have to create a systemic system that creates wealth for people. The first part is education. We have some entrepreneurship programs. We have some investment programs. We even have some employment programs if you want to go that route. The next step-I don’t know if I should be giving this out yet-will be starting a credit union so that people, when they create their money, house it in a place where they own. That’s one difference between banks and credit unions. At credit unions, you become part owner because you’re a member of the credit union. So that’s the next phase.

Phase three is going the private equity route-democratizing private equity so that the average Joe can take advantage of private equity opportunities. What I’ve realized is that every billionaire, at least in America, made their wealth primarily through private equity not through the stock market. You can leverage your profits in the stock market, but they build it on the backs of private equity. The average Joe doesn’t know this so if we can create a system that allows the regular Joe to participate in a smart way (not with a Las Vegas casino all-in and-lose- everything mentality), I believe that we can grow communities.

So how would it look if we have a neighborhood where people in the neighborhood are part owners in the local convenience store? In the local restaurant? They would treat that convenience store and restaurant better because they are part owners of it. The restaurateur wouldn’t have to go to the bank and get a loan because the people in the neighborhood are part owners. As a result, there would not be as much debt and everybody would benefit. That’s the goal for SIFT. That’s why I said that we’re just getting started.

What business books have inspired you?

Green Power and Black Titan which were written by A.G Gaston. Those two are amazing. A.G Gaston, I think, was the first black millionaire in Alabama. I was impressed by this man because he had the first black-owned bank in Alabama and he had a third-grade education. His name was Arthur. My name is Arthur. His mom’s name was Rosie and my mom’s name is Rosie. So I just figured – it must be meant for me to do the exact same thing in my generation that he did in his.

There’s another book called Thou Shall Prosper by Rabbi Lapin which basically shows how doing business and being a business owner is a good thing so that one is powerful.

Obviously, Think and Grow Rich and others like it are great, but Green Power was the first one that came to my mind.

What is a recent purchase you have made that’s helped with your business?

Hiring an executive assistant to force me to focus on one task at a time and to act as a filter.  As I still have trouble saying no when it comes to helping people, she is the barbed wire to keep me from saying yes too many times to too many things.

What was one of my most frustrating lessons?

It doesn’t matter if you feel that people need your solution, product or service.  Even if it’s true and even if they will die without it, unless they decide that they want it, nothing will happen.  So sometimes, you have to give up on serving some people even if your heart wants to keep trying different ways to get them to see how much they need what you are offering.

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