Designing a Business with Real Freedom

Covert Code Podcast  |  Host: Anna Covert  |  Guest: Michael Walsh

Aloha. My name is Anna Covert, and I'm coming to you from the beautiful island of Oahu. This week on the Covert Code podcast, the topic is Designing a Business with Real Freedom. My very special guest is Michael Walsh, author of Freedom by Design and founder of the Michael Walsh Growth Institute. For the last 30 years, he's been helping business owners from North America all the way to Europe scale by the tens of millions, all from three core principles of freedom: freedom in your business, freedom from your business, and freedom because of your business. Thanks so much for being here today, Michael.

Michael: Well, thanks for having me here.

Anna: To begin, we like to give our listeners the Cliff Notes version of the Michael Walsh story. How did you get from where you were to where you are now?

Michael: Last May I celebrated 30 years of running this business. Before that I was doing personal and corporate tax and investment planning. I had one client — a vice principal — and we got him into a real estate investment that saved him $27,000 in taxes. We charged $1,500. He was thrilled. The next year we did the same thing, sent the same bill, and he complained. He said, "You didn't save me any more." I said, "You got $27,000 back of your $30,000." He said, "That's what you did last year. What have you done this year?"

Michael: That was clarifying. You can only save people so much tax. But if you can teach people how to sell more, they keep paying you more — there's no lid on that. So I went in that direction instead. Thirty years later, here we are, working in Canada, the US, and the UK.

Anna: So when did you know it was time to write this book?

Michael: The first book I wrote in about two weeks in 2009 while on holiday in Hawaii — mornings writing, afternoons exploring. Published in spring 2010. Then in 2014 I co-wrote a book with a client named Louise Pastor Field. She contacted me in 2011 with a £400,000 business, and by 2014 we'd grown it to £2 million. By 2018 she was at £7.3 million and sold it. She was already 52 when we started — not a tech mogul, just a mom in e-learning who wanted to grow quietly.

Michael: Then COVID hit and I had more time. In about three months I mapped out the hidden traps at every growth milestone past a million in revenue: the $2M mark, $5M, $10M, and the black hole between $12M and $20M. I finished the first draft by August 2024 — 76,000 words. My developmental editor said it was the kind of book that lasts a decade, but told me to cut it to 40,000. It took until May 2025 to get it there.

Anna: I had a similar experience writing my Forbes book on digital marketing. I had 55,000 words and thought I wasn't done, and Forbes said "stop writing." I had to rewrite too. People ask if it's a lot of work — I say just dump the data, get it out. Business books are easier than fiction. People want something bite-sized they can consume and move on.

Michael: Absolutely. The dance is making sure people get enough to do something with it, while keeping it digestible. Early feedback I got was, "I'm halfway through and this almost feels too easy." They finished it and said, "I have to reread this — there's way more in here than I expected." So I guess I did something right.

Anna: Let's talk about the three core concepts of freedom. What are some ways people can tell they're not on track?

Michael: Any company with 20 or more people finds that about 80% of their issues are around people. When you swell your ranks, it gets harder fast. Here's a stat from the book: four people in a group means six one-on-one relationships. Nine people means 36. Twenty-five people means 300. Fifty people means 1,225. A hundred people means 4,950. No wonder it gets hard. It's like the seating plan at a 100-person wedding — you can't put Jerry next to Mrs. McGillicuddy. In Hawaii we call it the coconut wireless: three degrees of separation instead of six.

Michael: What happens is you blow through your structures because they can't handle the numbers. Quality problems start appearing, profits shrink, and nobody knows why. The issue is you don't have the infrastructure to support your teams the way you used to.

Michael: The other huge factor is that people don't understand what management is. Most people get promoted because they were incredible individual contributors — Maxine gets everything done, totally trustworthy. So we make her manager. Except the skills that made her great as an individual contributor are the opposite of what she needs as a manager. A manager's job isn't to control people or tell them what to do. It's to provoke thinking and awareness — because actions and results follow from that. Nobody ever tells Maxine that when she takes the job.

Anna: You and I just met today, and we already have a relationship. Neither of us controls it.

Michael: Exactly. The only way I could control the relationship is if I tried to control you. And you don't look like someone who wants to be controlled.

Anna: I'm a Viking — half Swedish. Not that I start fights, but yeah.

Michael: So Maxine's job is to replace broken structures with ones that support people to be at their best. And when people are at their best, it's just so cool to work together.

Anna: At my agency we've had the same 21-person team for about three years now. That's exactly what you're describing.

Michael: So do you have freedom in your business? Yes. Why? Right people, good structures, and they have each other's backs. You can take time off and the thing is covered — that's freedom from your business. You can write books and take on thought leadership — that's freedom because of your business. And that's at 21 people. As you grow it takes different skills, but the principles are the same.

Anna: In America it feels like there's never an end. When do you tell a business, "Is this enough?"

Michael: Somewhere between 35 and 40, most people discover that as long as they have their health, they can take care of their family for the rest of their lives. Before that, survival is driving them so much that they can claim a purpose — but really they're being driven by survival. We have a biological need to survive and an innate desire to thrive. And we get addicted to the adrenaline of urgency. Even when we're not in survival mode, the adrenaline still pulls us in. When we try to slow down it feels weird. Once people discover they have enough, they keep growing — but now they do it because they want to, out of curiosity or commitment. That's when purpose actually counts.

Anna: Do you know Dr. Joe Dispenza? He talks about this — how people are conditioned to a reality they don't even love anymore because they're addicted to the chemicals of the fight.

Michael: I haven't read his work, but now I'll have to. It's basic survival — not surprised we'd land on the same ideas. We use adrenaline to get through survival, then get addicted to it. When we try to stop, it just feels so wrong we don't know what to do without it.

Anna: What's the biggest impediment to growth?

Michael: Activity. People are doing too much. If you can't take a week off every quarter, don't try to grow yet — it just gets harder. Within two or three years, we get clients taking a minimum of a week off every month. I discovered this in 1998. My wife pushed me to go to Mexico alone. I slept until Monday, then spent three days reading a four-inch binder of customer satisfaction surveys at the pool. The following week I sold four of them for $2,500 each — an extra $10,000. I just went away, and because I went away, I made $10,000. So for the next 15 months I went away eight weeks. Then I started taking the last week of every month off, and my income kept rising. The rest more than made up for the time away. The bigger the game gets, the more you're paid to think — and you need to be clear to think well.

Anna: My team loves when I go away. They say, "Great, we'll get everything done." And I come back fresh with new ideas. When you own an ad agency, distance is good for everyone.

Michael: I was on a call this morning with a client in Nashville who just got back from ten days off. He said, "I finally got clear — I already have enough." We'd been telling him that for six months. The penny dropped, the light went on. He's building a publishing house to help people write fiction, and it's all clicking. That's freedom.

Anna: For flow state to happen with writing — the first 30 minutes is warmup. After that you just toss it all out and it flows. You have to be uninterrupted. You're just a channel.

Michael: People say, "You must love writing." I say, no — I love having written. When the ideas drop in and you think, "Did I write that?" That's the good stuff.

Anna: What's one tip listeners can start today?

Michael: Rethink the core of your business and include your people as part of it. A business isn't a well-oiled machine with people as cogs — it's an intelligent ecosystem. Half the battle is who you invite in. The other half is how you support them as they grow. Hire smart, align on values, and people will support each other far more readily. When everyone is at their best, there's no stopping you — whether you have 21 people or 130.

Michael: And because you've been so generous, I want to give something to your listeners: our entire hiring guide, free, no book purchase required. It's a 70-page document covering recruiting, employee selection, and onboarding — with the exact questions we ask, the answers we're looking for, and which answers raise red flags and why. I'll send you the link for the show notes.

Anna: That is so generous! And where can people buy your book?

Michael: Amazon — Canada, the US, UK, Mexico, everywhere. Just search Freedom by Design by Michael Walsh.

Thank you so much for being here, Michael. And thank you to everyone listening. We just reached over 125,000 subscribers — because of you and your aloha. Please subscribe if you haven't, share this with friends and family, and I cannot wait to see you next week in the pixels. Aloha!

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