Show notes for podcast episode 26.
On one hand if someone is selling a business I’m immediately a little skeptical. it must have some problems. Why would they sell it if not? It might require too much of their time and energy. It might be stressful. It might be losing money. The future might be looking bad for the industry as a whole. You are often buying yourself a problem that you will need to fix. You are often buying yourself a job.
On the other hand if it is a very healthy business and it runs without the owner that owner will want too much money. It will be too expensive for you to buy. It would make much more sense investing in starting a company and growing it from scratch and copying that business model.
That said it might just make sense for you. I recently read an article that highlighted the fact that a lot of businesses are going to come on the market for sale as the baby boomers approach retirement. Baby boomers rule in the service area. They own the contracting companies. They own the home service businesses. I’ve designed this podcast around the fact that most of them run their businesses like its 1985 and you can out operate them, but still as these businesses either go up for sale or shut down I look at this as an opportunity. So lets discuss when I think buying a business might just be a great decision.
Lets look at a series of questions. No matter what business you are looking at you need to think seriously about these questions and answer them honestly.
Do you understand the business? Have you worked in the space? Do you know how each aspect works?
Have you done a complete market study? Do you know the competitors in the space like the back of your hand? Have you called them and played a customer and taken notes on what you’ve learned? Make sure to call the business you are considering buying as well, playing a customer and asking a laundry list of questions.
What are the barriers to entry? Do strong brands in the market have a serious advantage?
Is the service itself repeatable and scalable? Can you train others to do it? How long would training take?
What are the risks associated with the service or business? Do you have 18 year olds driving around box trucks? Thats the number one risk in my student storage business.
Is the industry in general growing in size? Is the service getting cheaper or more expensive? Are more customers coming on the market each day or are less?
Does the company have a good online reputation? Make sure to look at the customer service inquiries for the entire previous year during your due diligence. Look at online reviews.
Is the real estate it sits on included with the purchase?
How valuable is the human capital within the business? How long have the key employees been there? How skilled are the service providers? How likely are they to leave if the business is sold? Are they easily replaceable? Don’t count on buying key employees and having them stay. Businesses that rely on extremely talented people and fail without them aren’t the types of businesses I like and this is a risk if you are counting on this.
The big million dollar question is how does the business get their customers?
Does the business have infrastructure in place beyond marketing spend that brings in a lot of business? A top google ranking? A lot of word of mouth? Brand awareness in your area? A prime physical location? Or on the other hand are they spending money on new fresh leads each time they get clients? Obviously you are looking for the former.
Is the business repeatable or subscription based? Do they have a book of clients that come to them for service on a schedule? What contracts are in place with customers? How long are they committed? Do they have 50 accounts that are in place for eternity until they cancel? Thats serious value and you want this. On the other hand if a business spends marketing money to bring in every ounce of revenue thats a red flag. Low barriers to entry and not much value in the brand as it exists.
If I’m starting a lawn care company, a pest control company, or a cleaning company I would consider buying an existing one because they would come with a book of accounts. You would automatically inherit their scheduled customers and the revenue that comes with that. On the other hand if I’m considering buying a brick and mortar mechanic shop and the customers all come in off the street there isn’t much value in that to me unless you are also going to own the prime location and real estate associated with it.
What is the owners role? Does she personally know the big clients? Did she bring in the clients? What is her day to day at the company? What will happen when she leaves? Will she take the clients with her?
What will happen to the operations if she leaves? Is there a massive hole in the company? Would you be required to take it over and basically be buying yourself a job?
Okay those are the main questions to ask yourself. Now lets talk about situations where I think buying a business might be the best move.
If you own a competing business in the same industry and owning that business aligns with your strategic plan.
Lets give an example from my experience. We own a student storage company. Our strategic long term plan is to develop relationships with universities and sign contracts with them to be the preferred vendor on campus. We would consider buying another student storage business if they had contracts with universities. We know those contracts are critical to our growth so that would add serious value to our business.
Its worth more to you than it is to anyone else.
As you know we are in the student storage and the self storage business. In October 2018 we bought out a neighboring storage facility that was more valuable to us than it was to anyone else..
We built our facility in 2017 and had originally planned for a two phase development. We have a very high traffic location which is great for our business but the site has some geographical issues and we were required to build our building into the slope and make it two stories. So not only was there a ton of earthwork to do but we also had to build a two story building which requires a lot more infrastructure and steel. This makes it very expensive to build our second phase. We made a budget and it was going to cost us around $60 per square foot. We needed the space badly because we were about to fill up our facility.
There happened to be a neighboring facility that was around the corner and off the beaten path. It had almost no traffic and no sign so it was very hard to see from the road. But it was only about a quarter mile from our main facility. 12,000 beautiful square feet of rentable storage space. This was $10k a month in revenue if we could get our hands on it.
I reached out to the owners. They were interested in selling. The facility was underperforming. It was only about 20% full. The lack of traffic was killing it. Nobody was interested in buying it because it had no traffic. The buildings were in good shape and it even had a gate and fence around it.
We had the traffic and it could be rolled into our current operations easily because it was so close. We could direct customers from our main location over there easily and wouldn’t even need to rent the units at a discount.
We knew we were on the short list possible buyers so we came in with a low price. They countered. We stood strong. We came to an agreement at $400k. $33 per square foot. Instead of building more space on our parcel for $60/sf we purchased for $33/sf and this was a win win. They would have struggled to find anyone willing to buy at that price but it was worth more to us than it was to anyone else. We closed shortly after and rolled the buildings into our operations seamlessly. It was a huge win for my partner and me.
Another time I love to buy is when I’m one of a very very small group of buyers or possibly the only buyer.
I like to shop in a market that is small. That’s the problem with buying rental properties on zillow right now. If it’s on zillow you’re competing with thousands of other people looking to buy a rental property. Not ideal right? The person who is able to clean up tax liens or buy foreclosures is always getting a better deal because they are competing with a smaller market of buyers.
What makes the buyer pool smaller? Problems. Problems like the ones that come up when you ask the initial questions we started with.
Consider looking for a business with some problems with the business that you can solve but others can’t. That makes you the only possible buyer. That was the case with the self storage facility we bought. Traffic was their problem. We had the solution and we were the only ones with the solution. Perfect situation.
Don’t look for the perfect business to buy or you’ll be in a tough market and you’ll overpay. Consider buying the business that has some problems and being the only person to bring an offer at all. That puts you in the power position during negotiations and you can find some great deals that way.
Opportunities do come up. Maybe you work at a company on the management team and the owner (who is very involved) gets sick. Or maybe he needs to retire. You are in prime position to be one of the few people to buy the business.
The way the process works is you are first asked to sign a non compete and non disclosure. Basically stating that you won’t use what you learn to try to steal customers or share it to the public.
Then you get basic financial and customer numbers that can give you what you need to make an offer and go under contract to purchase. Then you will want at least 90 days due diligence to really dig in to the nitty gritty. Make sure the due diligence you want to do is explained in the contract. During due diligence you can often uncover things and then negotiate the price further and that is very common.
If you are going to buy a business make sure you do very in depth due diligence. Do extensive interviews with all key employees. If they don’t allow this then thats a bad sign. The employees should be in the loop with what is going on. Ask them all the same questions. Anything fishy? Do you they would leave when the company is sold? Do you need them at all?
Depending on the type of business consider interviewing key customers and talking about the business reputation and their experiences.
Make sure the accounting and bookkeeping is well organized and the record keeping is tight. Run the other way if the owner talks about taxable income in a different way than the amount he pulls off the business. This is a huge red flag. How are the books? Are the accounting practices solid and organized? Don’t give an inch here. If the tax returns don’t prove it it didn’t happen and discounts are coming.
Consider including a performance hurdle that the business must hit in the coming years to finalize the payout figures agreed upon. This is a way you can hedge risk but you’ll also end up paying more for this and it could complicate things.
Consider keeping the owner on board in a hired position during the transition. This can help you learn the business but is also complicated and you must realize they will not be very interested in working hard.
Lets talk briefly about the valuation of the business you are considering buying. This is extremely tricky. Owners often overvalue the work they have put in as well as the future potential. I’m not going to be able to give you 100% accurate advice here because all businesses are so different but lets go over the basics.
Before you even start you need to figure out what the business is worth to you.
Make a pro forma to estimate your cashflows. I have a sample pro forma on the website. Search cashflow projections. Spend a lot of time on this. Run them 5 different ways ranging from as expected to better than expected to worse than expected. You need to have the capital to make this fail proof. Even if things go as horribly as possible it won’t force you into bankruptcy. This likely means you need a lot more cash to make the purchase than you think you do.
If you take over the business how profitable will the customers that come with that business be?
Use your data to run the cashflow projections at your margins and come up with a projected profit figure. Now what return are you looking for on your investment in the business? I would think at least 20% for most service businesses. If you spend X on the business you are going to get a 20% annual return on that purchase. Now you have a price that the business is worth to you.
Now secondly you need to get a professional valuation. Pay for an appraisal to determine the market value. Consider paying for it yourself (or through your bank) and keep the numbers to yourself early on because you might not want to pay market value.
No matter how you do it you want to have a value in mind before the negotiation begins.
You want the seller to be the first to name a price. It will likely be a lot higher than what you’d like to pay. React accordingly with a short response email “this is much much higher than we had in mind and we are not in the market at that figure.” and let the days tick by. You can get more and more aggressive with the negotiations depending on the position of the sellers and the amount of buyers in the market.
A little off topic here, but while negotiating it helps to have some “partners” that need consulting, even if they don’t exist, between communications. You can use this to your advantage in a few ways as you play good cop bad cop and draw hard lines in the sand.
Should you use a business broker? If a business is already for sale you probably aren’t going to have much of a choice. But if I’m buying a business I don’t like going through a broker. They don’t have my best interests in mind. They just want to sell the business and take their 10% cut.
They also keep me from having initial conversations with the owner that I think are critical. I love to get on the phone with an owner and listen to them talk. Ask some open ended questions and just listen to them. I can learn so much about someone and the situation that way.
I call around businesses and ask the person on the phone to get me in touch with the owner because I’m a local business owner who is interested in a partnership. I say partnership because often a business owner doesn’t want his employees thinking hes going to sell the company. Once I get the owner on the line I begin the conversation about an acquisition.
Now just because I don’t prefer using a broker doesn’t mean I’m not going to enlist some professional help. I’m going to hire a great attorney and accountant to help me with my due diligence and with my contracts. I’ll also pay for a third party valuation of the business.
Funding can be tricky. If you are buying a service business without any physical income producing assets you will likely only be able to finance about half of it through a local bank. That means you’ll need some serious capital on hand.
Remember that you can get creative with the structure. You can do seller financing and have them hold the note for you. You can pay out over several years and the amount can change based on performance hurdles. You can keep the owner on board as a salaried employee and structure an earn out over a few years. There is really no limit to how it all can work so consider thinking outside the box.
Overall, buying a business can be great. Now lets look at the other side of the equation.
Generally speaking if you aren’t a business owner already and you don’t have extensive experience in the industry buying a business is rarely the right call.
Use that capital instead to start a business and pour rocket fuel on it in the early days to get it to grow very very fast.
If you aren’t an experienced business owner buying a business is often just buying yourself a job and taking a lot of risk to make it happen.
So many people buy businesses because of their own interests and their own passions and not the needs of the markets. I can’t overstate the importance of doing a serious market study and looking at this whole thing through clear non-biased eyes.
Put the principles in this podcast to work and build your own business. Start small. Add value first. Work on the stuff that is important but not urgent. Simplify the job for your employees so normal people can do really well with minimal training.
Think about your time in the early days of building a business as adding long term value in the form of appreciation. Not just an hourly wage based on your income at the end of the year but the value that you are adding to the business in the event of a sale down the road.
In year one you might only make $20 per hour of your time in income at the end of the year. A lot of reinvesting. A lot of marketing and equipment purchases.
But what if the business you started 12 months ago is now worth $100,000 on the open market. What does that do to your hourly pay? Now we’re talking.
I know every situation is complex. There are a million variables at play here. You might have a great opportunity to buy a business right in front of you and taking my advice might lead to a bad decision or a missed opportunity. Keep these things in mind but don’t think what I say is the golden rule. Its impossible for me to give accurate advice on every situation out there based on the generalizations I’ve made here.
It comes down to weighing the pros and cons, getting professional advice and looking at this stuff with a clear logical mind. Don’t let your emotions get involved. Don’t sort information and accept only the stuff that supports your personal directive.
If you are in this situation and want an outside non-biased opinion (for what its worth) I’d love to help out and give you some advice. Reach out to me by email at email@example.com.
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Go on craigslist and look at furnished apartments, condos, and homes for rent. Note the number of bedrooms, location, parking etc. Look at condos in great locations. Look at homes near beaches or conference centers. Places near campus in a college town. Those are good targets because they will rent for much more on AirBNB than they would as a monthly rental.
Go on Airbnb and compare the asking rents based on all of these factors.
Create an extremely detailed month to month pro forma (cashflow projection model). Property taxes are listed on public record. Estimate insurance. Estimate utilities. Estimate all the related expenses.
Now estimate the income. It all depends on your town and the location of the property. Note all of the events and raise the prices on those days. Note all the off times and price reasonably and assume lower occupancy.
Compare the rental returns vs the home values. Is it nearing a 10% annual return on overall value? Thats really good.
Could the property do better on Airbnb than on a monthly rental plan with a tenant? If so then thats good and you might be able to convince the owner to let you try it.
Now find a way to reach the people who own the homes that are ideal short term rentals. A lot of them are listing their rental themselves on craigslist so you’ll reach them when you call the number. Another option would be to find their information on the public tax records. Send them a hand written letter.
Show them the projected income. Let them know you are estimating based on research you’ve done. Convince them to let you give it a shot. Agree to share the profit 50/50. Be up front with them, let them know the risks, get the required insurance, and manage expectations. Make sure to check your local regulations around short term rentals.
Get very aggressive with the pricing strategy. Most people under price their short term rentals. Read and study ideal occupancy rates. Read and study ideal times to rent and raise prices. Study events in your town when demand will skyrocket. Learn and learn and learn about this space.
Outsource the cleaning to yourself to make more money.
Collect data. Data will be your biggest asset. Its what will allow you to predict income and sell new property owners on hiring you. Once you can reliably predict a 10% return (on total value) for an investor they will gladly buy properties and hire you to manage them.
Eventually you can expand and try to get people to let you manage their homes who will be traveling for long periods. Or people who want to spend a month abroad. Or people who simply want to stay the night with a friend and make money when there is a college football game in their town. Some of the property owners might pull the listing and just decide to own the income producing asset and let you manage it full time.
When you have data you can eventually predict the value of the properties. You can begin to find investors to buy properties with the sole purpose of having you manage them as short term rental properties.
The data will start to pile up and you will get more and more confident in the income projections. You will have a track record.
Now you will have the cash to put a down payment on a cheaper house or condo and own it yourself. Enjoy all the cashflows.
There are a ton of advantages to this from a tax perspective over a typical service business. You can depreciate your asset each year. Your tax rate on it is 15% vs standard income tax rates as long as it is a passive asset (which it is because your rental company is your main business). Your asset will appreciate by 2-5% per year. When you sell it you can do a 1031 exchange and put off those taxes even longer.
Buy 1 property the first year. Then 2 or 3 the second. Then 5 a year for 2 more years. Whatever pace you are comfortable with here. Soon you’ll have your own portfolio and you’ll be on your way to real estate wealth.
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Lawn care is growing extremely fast in the US. 20 years ago 5% of people paid to get their lawn mowed. Today 40% do. 10 years from now 60% will. That is a lot of new customers coming on the market every day.
This was my first business as a 13 year old in 2003. When I left for college I had 40k in the bank working 20 hours a week each summer.
Buy a web domain and hosting for $1.99 per month and build a WordPress site. Get a Google My Business location. Get some reviews on here as fast as possible. I wrote down all the early tools I used here if you’d like to check it out. Doing this while you have a full time job is the perfect way to start. More on that here.
Its competitive. A lot of companies are doing it. Answer the phone every time with friendly, eager professionalism and enthusiasm and you’ll be in the top 10%.
Watch Zillow and Realtor.com and filter for homes that are recently sold in your target areas. High priced houses on small lots (1/4 acre or smaller at first) so you can use a push mower.
Get a logo and some door hanging flyers put together using a freelancing site. Get your logo embroidered on a nice polo shirt. Don’t forget a market analysis.
Put on your polo and a pair of khaki shorts and go to the homes that recently sold and knock on the door. Smile at them and shake their hand firmly. Tell them you just started a lawn care company and you’d love to offer them a free cut and trim with no obligation. If they don’t answer hang the flyer on the door and go to the next house.
After you have a few customers interested buy a self propelled push mower and a trimmer used. Get a leaf blower too. You can start small with this stuff at first and upgrade later. Practice mowing your own or friends lawns. Mow in lines to make it look nice. Edge the sidewalks and driveways with the trimmer. Blow off the pavement when you are done.
Watch and read a ton of stuff online. There are great resources on YouTube that will teach you a lot of tricks and tips. Study the different types of turf and what length you should cut them.
Play around with the pricing you charge. Use the free promotional mowing as a test and make sure to time it. Price your time at $40 per hour at first but make sure to charge by the cut. Most of the small lawns will take less than an hour even with a push mower.
Get some nice lawn signs made and ask customers if you can put them in the lawn. Some will let you if they like you. If they don’t offer them a discount on a future service.
When you start to get some momentum set up a CRM like Jobber. It allows you to look way more professional than you are. Do all of your billing online. Attach photos of the lawns as they are completed.
You are not going to compete on price. You are going to compete on professionalism, service and quality. They are going to like you as a person and want to do business with you. Learn more about this concept in my episode#13 “never compete on price again”.
How about a text message when you are on the way to service a customer? How about a link in that text to a picture of the smiling clean cut person who will be stepping onto their property? And a note about what you can expect from the person and how the appointment will go?
How about instead of a t-shirt and dirty jeans you have a collared shirt and khakis? How about hair up in a pony tail, tattoos covered, and beard neatly trimmed? How about a giant smile, a firm handshake and an enthusiastic opening statement?
Eventually you will get some momentum. You will be able to upgrade your equipment and get a nice zero turn mower. You’ll be able to take on larger lawns.
Keep business cards in your pocket all the time. Customers will approach you as you work. Offer referral rewards for your customers. Send them Christmas cards. Form a personal relationship with them. Know the names of everyone in the family. Show up with a teddy bear when its the little guy’s birthday.
Maybe partner with a few realty shops in town or watch the MLS and visit homeowners the week before an open house. A home looks a lot newer with a perfectly manicured lawn. Use google maps and street view to quote jobs instantly over the phone with customers. Don’t forget commercial real estate.
Make sure to get the proper insurance and permitting in place before you start. If you’ve never operated a lawn mower this is not the business for you.
Consider learning Spanish so your customer and employee base is expanded. Consider getting into herbicides. You’ll need to take a class and get permits for this. Treating a lawn with $10 worth of pre-emergent in February or March will make a lawn look 10x better all year. Another few treatments of 2-4-D and fertilizer and you’ll have it looking like a million bucks. Consider exploring landscaping projects.
Eventually you will build a great little. You will compete on speed and quality and not price. You will charge more than the average joes who offer lawn care and people will be happy to pay it. You can chose to stay small and charge a high price or try to grow and scale the business.
“On demand” is going to be your competitive advantage so you can charge a higher price. Make sure you can offer next day service or same day service. As soon as you get too busy to do that you need to raise your prices or hire another employee.
Make sure that person is presentable and clean cut. Simplify the job so your employees can thrive. Train them to do their core task really well. Don’t ask them to do 20 things or they’ll do them all poorly. Don’t forget workers comp.
Now spend all of your time answering the phone, dealing with clients, and quoting jobs and managing the marketing. Build a series of youtube videos targeting your city and the keywords so you show up on the second largest search engine in the world (Youtube).
You can chose to plow snow in the winter or you can spend the cold months down south. Seasonal businesses are great because you can revamp your operations in the off season and really make great improvements.
Don’t like lawn care? Check out this list and take your pick.
The highest ROI you will ever achieve is when you spend money to reach out and touch the people who need exactly what you are selling.
Who is the one type of person who your business is designed for?
Who is your perfect customer?
What life event just happened to them that makes them need what you are selling?
What do they own (or just purchase) that makes them need what you are selling?
How old are they? What neighborhood do they live in? Where do they work? Where do they hang out on the weekends?
Ignore everyone else. Stop shooting from the hip at 18-99 year olds. I know you might service a lot of different people, especially early on. Who is your most profitable, perfect, easy to deal with customer?
Think hard on these questions. Get creative. How can you can get in front of them? Do things other businesses aren’t doing. Do thing differently. Think outside the box.
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ea·ger pro·fes·sion·al·ism – /ˈēɡər/ /prəˈfeSHənlˌizəm/
(of a business) the strong desire and excitement to exude competence and skill.
Invest in the customer experience and you will reap the rewards. It starts by answering the phone with a smile on your face, excitement in your tone and a genuine desire to add value first and profit later. That will get you ahead of 95% of all companies out there.
What else can you do to separate yourself from the crowd of hungry businesses?
How about a text message when you are on the way to service a customer? How about a link in that text to a picture of the smiling clean cut person who will be stepping into their home or business? And a note about what you can expect from the person and how the appointment will go?
How about a policy to put 20 cent shoe covers on your boots before you walk inside?
How about instead of a t-shirt and dirty jeans you have a collared shirt and khakis?
How about hair up in a pony tail, tattoos covered, and beard neatly trimmed?
How about a giant smile, a firm handshake and an enthusiastic opening statement?
Thats eager professionalism. And it works.
Service based entrepreneurship is what I promote for a number of reasons.
People are specializing more and outsourcing the services they need in their home and business. More and more customers come on the market every day. 20 years ago 5% of people paid to have their lawn mowed. Today 40% do. In 10 years 80% of people will.
The customers are already there. You don’t have to train a market and take a big risk teaching customers what you are offering. You don’t need a big new idea. You don’t need venture capital. You can bootstrap and own everything.
You can start out as a company of 1 making really really good money and chose if you want to turn it into a big business or not.
You have a ton of data out there to study and look for holes in the market where you can compete and carve out your niche. You can copy the businesses that do things well. Take a little bit from this company. A little bit from that company. Find one that does what you want to do in another city and mimic it in your city.
Who would you rather compete with? Massive companies and brilliant people from the ivy league or mom and pop down the street that runs a business like its 1985?
You can target your customers physically instead of competing online for clicks with every company in the world.
You can do one thing really really well and all you need is a handful of customers who need your service to get started and build a healthy base.
If you answer the phone and provide professional customer service you are ahead of 95% of the companies out there. You can compete on speed and quality and name your own price.
Its low risk. Its not getting cheaper every day like web development and software.
You can automate the business and gain location and time independence.
All the wealthiest people I know got started small like this. All the people with the best quality of life and the time to do what they want got started like this. My friends who tried going the product or tech route ended up getting jobs.
I could go on and on and on.
Want more? Subscribe here to get short, concise emails from me once a week to help you build a better business. I also share a business idea like this each week to get you fired up and get your gears turning.
When you get home from work one day go to your computer instead of the couch. Buy a domain and get hosting for $1.99 per month. Set up a website with WordPress. Pay someone on a freelancing site to create a simple logo and some marketing material for you.
Make sure your flyer has great copywriting. This is an example of what you might want to say:
Buy $100 worth of door hanging flyers created on UPrinting or your local print shop. Make sure your phone number and web address is on the bottom of the flyer.
That weekend go on Zillow or Realtor.com and get in your car. Drive around and hang a flyer on the door of every home for sale within 10 miles of where you live.
Read and learn about thermal imaging by watching videos like this. Take one of the many online classes. Consider getting certified. Watch an updated video on equipment so you can decide what camera to buy. Study the industry and learn as much as possible. Buy a camera for under $350. You can upgrade later.
Create a report template that you will use to report back to customers. Use the many many examples
Your phone will start to ring. Do some studying and take a class. Get out and service some customers at heavy discounts. Get the required certifications. Learn a lot.
Provide professional reports for them to use.
As you gain momentum start to grow your marketing channels. Partner with realtors to send you referrals and pay them a cut if necessary. Watch the MLS. Show up at open houses and hand out business cards. Get creative with your marketing. Find local real estate investors and offer your services to them for free at first to gain trust. Word will get out about your work and business will start flowing.
You’ll start to bring in $150+ per service and it will take you about an hour. Begin to partner with contractors who want the leads you have for new windows, roofs, insulation, doors, etc. Tons of opportunity here.
As soon as your weekends and evenings are full and you are bringing in enough money to replace your 9-5 quit your job and get serious.
Invest in some equipment like a drone and get certified to fly it. Start doing big commercial thermal imaging projects. Maybe expand to be a full on building inspector. Develop consulting relationships with developers and real estate investors in your city.
As soon as you are too busy hire employees and begin to build your company. Simplify the job so your employees can thrive. Train them to do their core task really well. Don’t forget workers comp.
Provide super amazing customer service. Answer the phone every time and be in a super eager positive mood. This along with the “on demand” nature will put you ahead of 99% of your competitors.
Don’t like thermal imaging? Check out this list and take your pick.
I saw this post online recently:
These can be inferred from various interviews of a great businessman:
Now my words:
I love the business man in question actually. People like him are going to take our economy and our world to the next level. His story is absolutely incredible. The fact that he continues to risk it all to drive amazing change is fascinating and we need more of our wealthy people and big companies to adopt this mindset.
But let me play devils advocate here. I’m not saying I’m smarter than anyone. I just believe this is misinterpreted.
Our entrepreneurial culture idolizing this rhetoric is why so many young brilliant minds end up missing all together and getting jobs.
Once you have had massive success like this person you can adopt this kind of attitude. For the average beginner only one or two of these principles should be adopted.
Take this critique with a grain of salt.
I think this business man in particular points his rhetoric towards a lot of other business owners. Hes frustrated that people have made great money doing normal things and now they refuse to risk any of it to do something worth doing and for the betterment of all people.
Your hypothesis (that there is a hole in the market for you) is still an educated guess until you get out and sell it and prove it. Don’t invest heavily until you know the demand is there and you have the customers to prove it.
You can (and you should) build out your financial projections 100 different ways but at the end of the day you can never build an accurate forecast. You can’t forecast because this is new. Its changing every day. There are thousands of variables. So much uncertainty.
Early on its about putting together the tools necessary to offer a core version of your service as cost effectively as possible. Here is my toolbox. The goal is low overhead and instant profitability.
Cast a wide net, then specialize
As your business grows you will specialize. You are focusing on the customers that are most profitable. You are reading the market signals and finding the underserved niches. You are designing your service around the 20% of customers that generate 80% of your profit. You are ignoring everyone else.
This involves casting a wide net at first and compiling data. You are tracking time and costs and complaints or refunds against revenue.
When the data points to high margins on certain aspects of your service focus on them. When the data points to headaches, refunds, and low margins on other services ignore them or cut them out all together if possible.
Keep your expenses as variable as possible
Things change quickly. So if things slow down you want to be able to cut your costs drastically on your command. That means keeping costs variable and reducing overhead. You can’t change your mind and stop paying on a 5 year office lease. You can’t change your mind and turn in your leased vehicle. You can’t change your mind and recoup your costs on the brand new equipment you financed.
There are two people you can’t get out of paying every single month: the bank and your landlord. In the early days don’t deal with either if you can help it.
When you hire employees be upfront that if things get slow hours will be cut back.
Avoid recurring costs that aren’t flexible. Don’t make long term commitments or sign long contracts. When Richard Branson started Virgin he bought his airplanes from Boeing with a clause that said he could return them if his business struck hard times.
Its about widening the gap between income and expenses
I’m not suggesting you hold on to your money and refuse to spend it. You have to spend money to increase income. Every hour you pay an employee and every piece of equipment you buy creates income. Every time you spend a dollar you are making an investment.
Its all about maximizing income and minimizing expenses. Do everything you can to widen this gap as much as possible. Remember this doesn’t have to be right this minute. Maximizing income in the long term is the focus – not tomorrow.
Ask the million dollar question for each significant investment.
Is there a way for me to spend less money on this purchase and still get the same return?
Will a $5k cargo van accomplish the same thing as $25k cargo van? Use this buying guide to find great value here.
Will a used pressure washer for $2500 accomplish the job the same way as a $5000 new one? Great, now you have $2500 to put towards marketing.
Will a new lawn mower for $12,000 make me $6,000 more dollars than the $6,000 used mower? It sure won’t. It will only increase my overhead and I’ll have to eat more depreciation if I’m forced to sell.
The math almost always points to buying equipment used.
Don’t buy into the image fallacy
You don’t need a nice car to get clients. You don’t need a $2k suit to get respect. You don’t need a shiny new mercedes sprinter van to gain trust from customers. You don’t need an office with high ceilings and a kegerator next to the ping pong table. You don’t need to entertain and spend money on fancy restaurants for your employees to be committed.
Customers are after value. They are after speed. They are after professionalism and fairness. They don’t care what your monthly payment is on the truck that shows up.
Employees are after a voice and respect. They want to make a difference. They want you to care about them and how they feel at the end of the day. They want you to listen to their opinions. They want you to set them up for success. They don’t care how swanky the office is or about the meals and entertainment you splurge on.
I’m not suggesting you spend hours or days shopping in order to save a few dollars. I’m suggesting you put effort into buying the big things right and saving money on the small things by forming good habits around your spending.
Buy your vehicles and equipment used. Avoid splurging on meals and entertainment. Avoid an expensive office by working remotely or using a co-working space month to month. If you need to unload your equipment you’ll be able to recoup a lot of your costs.
Use craigslist and ebay. Let other people eat the depreciation and buy perfectly good vehicles and equipment for pennies on the dollar.
Outsource your weaknesses
“Someone who practices a thousand kicks once is no where near as scary as someone who practices one kick a thousand times.” – Bruce Lee
If it isn’t in your wheelhouse then don’t focus your energy or take on overhead to get it done.
Get really really good at what you do best as a business and focus your energy there. Outsource the marketing (sometimes). Outsource the billing. Outsource the payroll services. Outsource the admin work. Outsource the compliance. Outsource as many non essential business tasks as possible!
Don’t hire a full time employee to do something a freelancer can do on a month-to-month contract.
Month to month contracts are flexible. You can terminate them and take it on yourself if things get slow. If you hire an employee on the other hand that is payroll that you will need to cover on a monthly basis no matter how things are going.
There are some things you shouldn’t be in the dark about even if you outsource. As a business owner you need to be competent and knowledgable about your accounting/projections, tax planning and marketing. You need to analyze data within your business to calculate profitability of each service you offer. You need to be a great delegator and communicator to your employees. You need to be driving and managing the training programs and overseeing the customer service. You need to be organized. You need to have a positive attitude and continue to do quadrant 2 work.
Market like a guerrilla
Adwords and social media marketing can have a great ROI but a lot of new companies don’t have the budget or the ability to analyze the returns.
Get creative and get in front of your customers physically. Flyers, yard signs, sidewalk chalk and even door to door marketing can work great. Network with individuals who often recommend your services (realtors for home services for example).
Lean out your life
Yes I know I know life is meant to be enjoyed. I’m not asking you to live with a painstakingly frugal mentality forever. I love a nice restaurant just as much as the next person.
If you are exactly where you want to be in life this post isn’t for you. If you have already designed your life exactly how you want it then by all means do what you want to do with your personal finances.
But if you are working towards a future goal and building a business its time to lean out your personal life.
There is no ROI on lifestyle expenses. There is no future profit on the nice car. There is no future profit on the expensive house (besides a little bit of appreciation to offset massive amounts of debt service). There is no return you get on the expensive dinner. Its all overhead. Its all money that is gone that you will never see again.
You are tied to your job right now because of the money you need to finance your lifestyle. If you are serious about leaving your job as soon as possible its time to get serious.
Remember this is only in the near term. You are delaying gratification now so you can build the life you want and buck your 9-5 and do what you want to do on a daily basis.
Every dollar invested in your business will become 2 or 3 dollars in the near future. Every dollar invested in everything else will either be gone or worth pennies. Free up your capital so it can work for you.
So you have a business now. Some momentum. Some profit. Don’t fall victim to lifestyle creep. As your income rises keep your expenses steady so you have more funds to invest when opportunities present themselves. Don’t finance the new Audi after a few profitable months. Don’t buy the house with the extra bedroom you don’t need.
When you see an opportunity or things get hard it will put a ton of pressure on your business when the money is flying out the window in your personal life.
If you stay lean a few amazing things will happen
You will avoid unnecessary financial stress. Your quality of life will improve drastically. You will have the peace of mind that comes with being able to ride out tough times or uncertainty and limit losses if they occur.
If you aren’t strapped for cash you aren’t forced to milk early customers and turn a profit right away. You can play the marshmallow game and delay profits and gratification. You can learn a lot and customers won’t be as harsh on early mistakes and growing pains.
The longer you can go without pulling big money out of the business the longer you can build a following and grow your volume.
You can invest in making speed your competitive advantage. You can frontload your hiring to provide on demand services and charge a higher price.
You can make more investments in growth and marketing. When you find a marketing channel that turns $1 into $1.50 you can double up your marketing spend. Instead of having that money tied up in a depreciating vehicle or a big office you can have it ready to invest and ignite your growth.
You can focus on adding value first. You can get out and offer a discounted service or a free service to new customers. You can get a following. You can learn more about offering your service. You can build a brand. You can get reviews on the most important online channels.
Offering a free first time service in subscription or recurring business models like lawn care, cleaning, mosquito treatments and others is an investment.
You can track your data and record how much each free service is costing you. Then you can track how many of your free services end up converting into a paying customer in the future. It is an investment and you will be able to easily calculate your return.
Risk is managed and reduced drastically
Business is all about risk and reward. Nothing is risk free. You are always risking something. Maybe time. Maybe money. Often both.
Running a lean business drastically reduces your risk. It makes your business more likely to survive. It limits financial losses if your business fails.
When the next recession happens and 50% of the businesses in your sector fail you will survive. You will be able to ride out the storm. You’ll be poised and ready to ride the next boom and capitalize on the opportunity.
When things change – your business must be able to change
If you are lean and your expenses are flexible you are ready to change course at the drop of a hat. You are ready and able to chase opportunities. You are able to specialize and turn down more customers than you accept.
Entrepreneurship is fluid. Nothing is certain. New competitors arise. Technology changes. Government regulation changes.
Your path will change. Stay lean so you can capitalize and build a healthy company that can survive the journey. Be frugal where it doesn’t matter so you can invest where it does.
“Someone who practices a thousand kicks once is no where near as scary as someone who practices one kick a thousand times.” – Bruce Lee
Too many entrepreneurs think that in order to make millions you need to influence millions.
Don’t be afraid to narrow your focus. Start local and start small. You only need a handful of true fans to get some momentum and build a healthy business. Its all about doing common things uncommonly well.
Get really really good at one thing and find customers who need that one thing. You want your target to be an inch wide and a mile deep.
Don’t spend all of your time training your weaknesses so you can be a jack of all trades and a master of none. Focus on your strengths. Exploit your strengths. Become a master at what you do best and then sell that.
Run a marketing agency? What is your target market? Startups? What type of startups? Tech startups? What type of tech startups? Software as a service tech startups. There we go. Ignore everyone else.
Say you own a cleaning company. What type of customer is your bread and butter? Lets say it is homeowners. Lets go further and say it is homeowners who own expensive homes, maybe $300k or greater. Lets go further and say that you specialize in cleaning these homes before they are bought or sold.
Say you are a videographer. A videographer that works with businesses. Not just any business but hospitality businesses. Not just hospitality businesses but event venues. Wedding venues. You make promotional videos for wedding venues.
Lets say you run a food truck. A southern BBQ food truck. A southern BBQ food truck with one menu item. Pulled pork sandwiches. Not just that but only one flavor of pulled pork with one type of slaw on top. Pulled pork sandwiches that are made in a crock pot the night before, can be served up in about 30 seconds, and are out of this world amazingly good. Now we’re talking.
Lets say you are a mobile mechanic. You focus on commercial brakes. You only do brakes on commercial trucks.
You do on demand party rentals. You only do toys and bounce houses designed for children 6 to 12. You focus all of your marketing and operations around birthday parties for children in that age range.
A catering company should focus on one type of food for one type of event and hit it out of the park.
Specializing like this makes your marketing much easier. If your bread and butter is software as a service startups you know exactly the forums they hang out in. The tech news sites that will feature them. The keywords you need to punch on google to find them.
If your bread and butter is cleaning expensive homes before or after they are bought or sold you can track the MLS and see exactly the homes that are listed for sale. You can see exactly the realtor that has the listing. You can get in with them and help them sell their homes at a higher price. You can give them hundreds of reasons why they should recommend your services.
Your hiring and training processes will also be much easier to streamline. Instead of looking for employees that are good at 20 things you only need them to be good at one thing. Its much easier to deliver a consistent product to your customers. Turnover won’t cripple you. It will be easier to grow.
Its so tempting to take on work that is outside of your wheelhouse. Its tempting to bend over backwards for customers. Its tempting to try to take on jobs that aren’t necessarily your wheelhouse but they are close. Don’t do it. Don’t let yourself. Know who your service is not designed for and stay away from them.
Make it a goal to turn down more business than you accept.
Okay so its early. You don’t know what your specialty is. You are not sure what your strengths are. How do you find it?
Keep track of your data and analyze it. Track your time and expenses. Track your complaints and returns / refunds.
Use the data to find out what your most profitable jobs are. You find out what kind of customers give you the best margin. What type of customer provides the smallest amount of headache.
20% of your customers will make you 80% of your profit. Build your business around these customers and fire the rest.
Notes from Podcast Episode 4. These are the essential tools you can use to start your business cheaply and have all the tools you need to operate right off the bat.
Step 1: Generate your idea
Step 2: Name your business and buy your domain.
Here is my method for searching domains and naming your company.
Use Ipage or a similar affordable hosting service. Don’t check availability on GoDaddy.com because there is a rumor they buy up domains based on searches. Install wordpress on your website in your hosting control panel. I wrote all of my content and then hired someone on Upwork for $100 to build this website. I would recommend spending a little more if possible.
Visit tends.google.com to analyze traffic and determine what keywords you want to target in your area. You can use this tool to see the relative size of your competitors and also predict slow and busy seasons.
Step 3: Incorporate your LLC or do business as a sole proprietor.
If you would like to avoid personal financial risk or liability set up the LLC and elect to be taxed as an S Corp (pass through). I recommend a sole proprietor if not up until the point you are ready to hire employees or your concept is proven. I like to name my LLC something very generic so that if I shift gears or go after another service I can change my “doing business as” name without any admin headache.
Step 4: Setup your bank account
Put $500+ in the account or less if you are strapped or more if you want to move quickly. Get a debit card or a credit card or both. Only use this account for business purposes. No meals. No entertainment.
Step 5: Get a logo and some media
Hire someone on a freelance site (like Fiverr or UpWork) to create a logo. Tell them you want it very simple (they tend to over do it) and get them to create a flyer and some other media as well.
Step 6: Get a uniform
Use a polo you like in your closet or get some apparel at Marshalls or TJ Maxx. Get a local embroider to put the logo on your apparel.
When it comes time to order polos for employees you can use Thet-shirtland.com. Its the best value out there in my opinion.
Step 7: Get a headshot wearing your apparel
Do a photo shoot with a local photographer to get some media for your flyers, graphics and website. A studio is great but if you can’t afford that give a college student $100 to get something here.
Step 8: Customize website
Build all of your pages and personalize your website with your media and logos. The About us page should have a picture of your and your family and should be a very personalized page. Person who looks at it roots for you, knows your story and who you are.
Customize the rest of your website and model it off a competitors website you love in another city on the other side of the country.
Step 9: Set up your Google Account
9A: Gmail. Set up a gmail account. Create a professional email address on your host like this: firstname.lastname@example.org.
Set up a forward from your hosting email to your Gmail address so anyone who sends an email to your domain email address gets forwarded to your Gmail. Then go in Gmail and set up “send mail as” in settings > accounts so you can send mail through gmail but it will come from email@example.com. Your host will have the login credentials to set this up in gmail settings.
Read about email etiquette here. Set it up on your phone and build your signature using the recommendations at that link.
9B: Set up a Google Voice number in your Google account at voice.google.com. Select your business phone number with a local area code. Forward this to your phone and set up the voicemail, hours and everything else. Be extremely cheerful and professional in the voice message. You can use this to text customers as well and forward to multiple phones. Get the app on your phone as well. Can also be done from your desktop computer.
9C: Google My Business is critical. Send a postcard to your location or get a PO box to set up the location. This will be the main way customers find you. Build this and nourish it and get reviews early on. Post on here often and answer every review. Services like OneUp let you schedule and auto-repeat posts on GMB.
9D: Google calendar is amazing for organizing your schedule.
9E: Google drive is the best way to store everything and stay very organized. Create folders for your different branches and tasks. Go paperless by using this scanner and printer: Brother MFC-L2700. Keep your expense logs/receipts scanned in one folder and your cashflow projections in another. Track your mileage very accurately using Google spreadsheets.
9F: Google Analytics. Get all the data on traffic to your site by setting up Google analytics and installing the analytics code in your WordPress header. This is incredibly valuable if you set up conversion tracking and use adwords with it.
9G: Youtube. Make an account for video and record a video of yourself in your polo talking about your business. Include the town name and other keywords you are targeting. This will be big for you SEO. This video we made a long time ago is still on the front page when you Google “Indiana University student storage”.
9F: Google Adwords. Use this to manage your paid search. Do a lot of research here or outsource this.
Step 10: Quickbooks Online
Link your bank account to this and track and categorize all of your expenses here. Hire a book keeper if necessary but make sure you take the time to understand this even if you do outsource it.P
Step 11: Taking payment
Accept only credit and debit cards off the bat using a third party payment processor like Stripe. Don’t take cash ever unless absolutely necessary. Your employees steal it. Its just another task at the end of the day to deposit or count it.
Step 12: Insurance
Get liability, auto, workers compensation, disability and unemployment insurance. There may be additional requirements for your industry (like cargo insurance for moving companies). Remember that workers compensation and payroll taxes adds 20% or more to your overall liability on payroll.
Step 13: Customer Relationship Management software
Consider using an out of the box software like Jobber to get started. This will help you communicate with customers, invoice and just generally run a very professional ship with little investment. Its easy to learn and very valuable. This gives you the ability to send customers very professional notification text messages when you are on the way to the job as well as invoice emails after the service is complete.
Step 14: Payroll software
Consider using a company that handles your payroll but also allows you to onboard your employees without paper. Gusto is a great option. Get I-9s and W2s done on the internet. It is much much easier than running payroll yourself through quickbooks or something similar.
Step 15: Mobile time tracking software
Use a time tracking software like T Sheets or others. Tracks the location and time logged for each employee using their mobile phones. They can clock in and clock out as well as add notes and geo location stamps as they work. Its great and it Syncs with Gusto.
Step 16: Slack
Slack is better than calling and texting and is a great way to communicate among employees.
Step 17: Asana
A great to do list app and collaboration tool for companies. My wife and I even use this to keep track of our obligations within our household. You can assign tasks, track deadlines and assign tasks to others.
Step 18: Purchasing
Craigslist is the place to purchase your vehicles and equipment but keep a look out on Facebook marketplace and other specialty sites within your industry. If you are going to buy a van or truck use this checklist.
Step 19: Mobile office setup
Make sure you have a secondary screen that runs on usb power for working on the road. I like the ASUS MB168B 15.6″ WXGA 1366×768 USB Portable Monitor.
Get an adapter that plugs into your car cig lighter and then creates an outlet for plugging in your computer so you can work in your vehicle.
Airpods are amazing for customer service and just generally working with.
I love my Autonomous adjustable desk that lets me sit or stand up in my home office.
Step 20: Compliance
Make sure to stay very organized with your filing deadlines for all of the administrative work required. Withholding taxes, payroll reporting, workers comp audits, renewals for your permitting etc. Use Google Calendar to mark important dates.
You will get a ton of mail once you start registering for permission to do business and to run payroll. If you are in college or you rent a place and might move in the near term consider hiring a registered agent to accept your mail and scan it up to you and email it to you as it comes in. These services are very nice.
You’re ready to operate and to start selling. Get out there and mix it up and learn the service!
It was about 8 weeks before graduation weekend in my college town in 2012. I was a senior about to graduate. My mother was bugging me to help her find a hotel near campus for graduation weekend. For her, my father, my grandparents and my sister. Three rooms.
I called about 10 hotels around campus. Checked Priceline. There was nothing available at all. AirBNB was the same.
The closest city with availability was about 30 minutes away. They only had 3 rooms left in the entire hotel and they were $350 per night plus fees, each, with a three night minimum. Even they were cashing in on graduation. Thats $3,150 + fees. I refused. I’d rather them stay home and miss graduation.
The closest hotels with normal pricing and availability were over an hour away.
I thought about my friends who were sophomores and juniors renting apartments in the area. Classes ended about 10 days before graduation. They all were gone for the summer working internships or back home. Their apartments were empty. I texted a group of three friends living in a three bedroom apartment. I offered them $500 if they let my parents stay there over the weekend. They quickly agreed. All set with my family and we saved about $3,200.
My college had recently added a feature to the email (Google powered email). If you started typing someone’s name it would autofill and provide you with their email address.
My school had about 4,000 students in each class and the facebook group had about 3,000 each. I joined each group.
I then went through using one screen on the facebook group members page and one screen on the gmail page typing in names and mining email addresses. About 20 hours later I had a list with the email addresses of 3000 juniors and 3000 seniors.
I typed out a nice email to the Juniors:
My family and a few of my classmates’ families are looking for a place to stay on graduation weekend. If you will be gone that weekend and would be interested in renting out your apartment to them let me know.
I then typed out this email to my fellow seniors:
A few of my undergraduate classmates are offering to rent their rooms to the families of seniors during graduation weekend. If your family needs a place to stay right near campus during that weekend let me know!
I sent both emails and then headed out to track practice.
When I got home 4 hours later I had over 400 emails in my inbox.
I ended up tiering the pricing based on location, cleanliness, ability to provide linens and amount of rooms. I paid out about $35 per room per night on average and I did a three night minimum for everyone. Graduation weekend is quite an ordeal so that was pretty standard anyway.
I rented the rooms at about $100 per room per night. This was a big savings over hotels but the guests had to be okay with a dirty apartment and bringing their own linens for the most part. But they got to stay in the heart of the action and save a lot of money.
I set low expectations for the renters. I told them it would be dirty. I told them it would be sweaty. I told them to bring linens and cleaning supplies if they wanted to.
I strictly told all of the underclassmen to clean their apartments very well. I sent them detailed checklists. I did the best I could to make sure it would be presentable.
As soon as I collected payment from the senior I would pay the underclassman and connect them on email telling them to organize the key hiding and check out stuff.
Overall I brokered about 60 rooms and cleared about $10,000.
My name is Brian Jump and I own Superior Auto Institute and Superior PDR, a Paintless Dent Repair school and service company.We started performing PDR back in 1992, when in Southern California it was just being presented to the market.
PDR originated in the late 80’s, coming first from the German automotive assembly lines and then making it’s way here to the states before eventually going around the world. PDR is now a global service in all continents. Some countries may not have many techs but the business is taking hold fast in all areas due to the huge opportunity.
We initially identified the first person in our county, and seized the opportunity quickly. We started calling on automotive dealers first, seeing the idea to make big money in this service business is volume clients. We had to convince them that paintless dent repair was real and offered free demonstrations to prove it. At first some were skeptical but most gave us the opportunity to prove our worth. You might imagine how happy they were to learn they could fix their vehicles without having to take to the bodyshop and how fast the service really is.
Removing dents onsite allowed for quick repairs to help them sell cleaner cars, which meant we helped them make more money (alot more).From that point we trained and added more technicians and began to service rental agencies, bodyshops, and then work directly with insurance agencies with hail damage repairs in the midwest. The training usually took 2-3 weeks and the new techs would ride along with the veterans until they felt comfortable on their own. We also provided them with tools so they could handle all dent repair situations in all types, makes and models of vehicles. Some people in our industry even take out dents in chrome bumpers and others service appliance centers with their dents.
Fast forward to today, we still have multiple route technicians who go to automotive businesses and the public, removing dents and helping people retain their vehicle value by keeping the original finish intact and avoiding the dreaded “bondo monster”.The market has matured a bit in the last 20-25 years, and there are many people and companies offering Paintless Dent Repair, but in most cases we still see a shortage supply of qualified techs, which keeps us busy. The areas with the most techs are in the sunbelt with the northern areas seeing more of a shortage.Our competitive advantage is simple: Excellent customer service, competitive pricing, and top notch craftsmanship. Since PDR is a handcrafted art, there is a wide variety of technicians and results. We strive to provide the very best results and as such have created a reputation and get alot of referral work from those who truly want their car in perfect condition. And with Yelp, Google, Facebook and other social platforms, getting positive reviews is key for prolonged business and referrals.
Providing a service business such as Paintless Dent Repair has been a dream: flexibility in hours, very low overhead with super high margins means we can work standard business hours (or less), we don’t pay any sales taxes (it’s all labor), and it’s not problematic whatsoever (dent’s don’t reappear!). So as you can imagine, this is what we call a “no headache” business model with crazy high margins and almost zero overhead. Not too many service businesses can match these benefits.
Across the United States, a qualified PDR Technician should meet or exceed $100/ hour, and it’s not uncommon to see daily earnings in the $x,xxx range. But even with that great opportunity there are still towns with automotive businesses waiting days or even weeks for a PDR tech to come service them.
Part of the reason is the annual hail damage that usually starts around April and may not end until September or later. This “thins out” the available PDR techs in many areas who leave to go “chase hail” and make the big bucks pushing 100’s of dents a day instead of dozens. The only downside to PDR is the difficulty in learning it in the beginning. The training is rigorous and difficult. PDR techs are essentially “sheet metal sculptors” and as such the training is intense and usually takes several weeks, with a apprentice period usually a few weeks more to several months. A career in PDR isn’t for everyone. The requirements included 20-20 vision (corrected or natural), reasonable good physical health, no carpal tunnel or severe back issues, and ability to focus (no ADD or other focus issues).A strong attention to detail with solid work ethic is paramount to succeed in Paintless Dent Repair as well.
Many people ask us why we chose to go into this business and we tell them a service business is the best way to make a great living and still afford time off to enjoy life. Isn’t that what it’s all about, anyways?
What skill is underrated or ignored that you think is and important key to success?
269 billion emails are sent and received every single day but nobody talks about email etiquette. The people who are good at it shine. The people who aren’t have a disadvantage and they often don’t even know it.
Nobody has time to read a novel. Keep your emails short, to the point, use bullets and other formatting if necessary and keep your paragraphs small. No email should be over 150 words.
If you are sending an important email to an important person spend just as much time reducing its size as you spend writing its contents. Sending a super concise email is a great skill so spend time and energy removing as much fluff as you possibly can.
If you draft and email and its too long go through it line by line questioning if each sentence or paragraph is absolutely necessary to get your point across. Nobody will read an email that is too long. Nobody will read an email with paragraphs more than 4 or 5 lines. Make it short and sweet.
It goes without saying that proper grammar and punctuation is important. Make sure it is well written.
Ditch the comcast, AOL, hotmail, etc. That shows everyone you are living in the stone age. Set up a professional email address using your domain name and setup “send mail as” and a forward to your gmail account. This way you get the professionalism of your own domain with the features of Gmail and the Google suite of tools like Drive, Analytics, Voice, My Business etc.
Set up a professional signature:
Don’t make your title CEO unless your company has 30+ employees. Its obnoxious and is not a good look.
Set up your phone email the same way with the same professional signature so nobody can tell if you email from your phone or your computer. Make sure to delete the “sent from my iPhone” at the bottom of the signature.
Carbon copying people is a great way to keep someone in the loop even though no action is required from them. I do this with my partner on nearly every email I send. Don’t overdo this. Especially if it is a sensitive email or corrects someone for a mistake they have made. Its similar to criticizing someone in public. Never acceptable.
When you receive an email with other people carbon copied it means that they want to keep someone else in the loop. Make sure to REPLY ALL. This is the most common mistake that I see people make. Replying to only the sender when the sender wanted to keep others in the loop on the communication.
I get hundreds of cold sales emails a year. Most of them are too wordy. Most of them put their hands out saying ME ME ME ME please help ME.
Set yourself apart by customizing it. Do a little online research on the owner. Read the about us section of their website. Add value first by offering to do a little bit for free or giving some real tangible advice without worrying about charging for it. Gain some trust and show the owner that you really can provide some great value down the road.
Use exclamation points and emojis. I know you don’t want to do this but its important. Too many customer service reps come off as cold and rude when its so easy to sound energetic and positive. Always thank them profusely for reaching out. Always end with a personalized touch.
Canned responses are great for this. Shortkeys can insert pleasantries before and after any message. Deal with the same customer service questions often? Develop the perfect canned response your reps can insert with a keystroke.
Emails are amazing at keeping a record. They are searchable. They are easy to bring back and forward.
If you make a deal with someone in person or over the phone follow up with them by email and ask for a confirmation response. If you don’t have a record of it it didn’t happen. CC your partner if it was a big deal and you want them to be in the loop.
Lay out tasks and have someone else agree to do something important for you? Confirm by email.
Somebody agree to help you with something and promise a date? Confirm by email.
I can’t tell you how many times this has come in handy when there was a disagreement later. Sometimes when I send an email after a conversation we disagree and have to clarify tasks that were just agreed upon! It saves tons of headaches and miscommunications down the road!
You can also send yourself emails to have in your records with attachments that are important.
So you have picked out a service that you want to research more and possibly offer. The customer base is growing, the competition is fragmented and the market isn’t a target for hobbyists and dreamers.
Your new business must provide a service either faster, better or cheaper to carve out a slice of the pie and be successful.
So your market analysis needs to be a deep look at the main companies offering the same service you plan to offer in your area considering these three criteria:
How hard is it to find the companies online? Are they buying adwords? Do they have any digital marketing? Do they have a social media presence? Online reviews? Is their business all word of mouth? What is their quality of customer service on the phone? Do they follow up with you? Do they try hard to get the sale?
How much are they charging for the service? An arborist might charge $800 to take down a tree that takes 2 guys 45 minutes. Are the margins high or is it relatively cheap?
I have a full podcast episode on this (#13 never compete on price again). The most important factor by far because this is going to be your main competitive advantage and shows if there is a lot of demand on the market. How busy are they? How long would it take to get a quote and get service? Can they do it tomorrow? Or next week? Or the week after?
Call every company in your city and play a customer. Ask a ton of questions like:
Get creative and specific. The goal is to learn as much as you can about a company and how they operate. You will be very surprised at what you can learn from a chatty customer service rep or a braggart owner.
Take detailed notes and you will spot holes. You want to find companies in that are backed up. Companies that are booked out a week or more. Companies that don’t have a website. Companies that don’t care if they get your business and don’t answer the phone and you have to work hard to get ahold of them. Companies that have work running out their ears and companies that are booked out a week or more. That is your main opportunity and tells you that there is more demand on the market than there is supply. There is space for you.
After a ton of research you’ve decided to pursue the venture.
Now as you model your business and build it study companies that offer your service very quickly and efficiently in another city.
Find someone in a major city that does what you want to do and does it really really well. They run a big operation. They get tons of customers. Their customer service is excellent. They can get to you tomorrow for service. They can get you a quote over the phone.
Study these businesses just as hard. You can learn a lot by picking and choosing what you like most from three or four different companies in different cities.
Naming your business is hard. Most web domains are taken. Here is my method for finding the best name:
Hopefully you have a dual screen setup for your work computer. If you don’t you should because you can be much more productive.
On one screen open your browser and go to synonym.com. On the other screen open ipage.com or any other hosting site. Avoid GoDaddy because I heard rumors that they buy up domains that have been searched for and sell them at a premium.
The method here is to use ipage to check availability while using synonym to help you brainstorm words to include in your domain name and thus your business name.
If you are a storage company you are going to try to have the word storage in your domain. If you are a lawn care company you are going to try to have the word lawn in your domain. You get the point here.
The other word is the important word.
The other word is either made up and random or signifies something about your business. Strength. Caring. Meticulous. Strong. Quick. Reliable.
In an ideal world the name you chose is:
While family and friends will be able to help narrow down your list they will not have the heart to tell you if your name is weak overall.
Get some stranger feedback on reddit or another forum asking for people to pick it apart. Take it with a grain of salt of course.
There is a ton of value in using data to narrow down your options by running A/B tests on Google Adwords. The method sounds complicated and expensive but its really easy. You can set a $50 budget and get enough data to make an accurate decision when deciding between two variations.
Here is a good article explaining the ins and outs of Google’s Ad Variation tool. There are also hundreds of YouTube videos.
Run two ads. Exactly the same adds with the same text except for the business name. Get the add in front of the same number of people based on the same search terms.
The variation that has the highest click rate is the more efficient name.
This is just a small part of the overall goal of building a successful business. Its important but it is not the end all.
If you already have a name that violates a few of these rules take everything into consideration and make the decision thats right for you. Don’t be afraid to rebrand but don’t beat yourself up over it either.
Words I like:
You do not need to quit your job. Yet.
Money and time are your most important assets. You need to free as much of each of these things up as you can in order to invest them in your new (side) business.
Lean out. Bank your money. Sell your expensive cars. Don’t buy the overpriced house. Rent for now. Pinch pennies for now. The less money you need to live the less dependent on your job you are to live. The longer you can go without reaping profits from your business the more momentum you will get and the faster you will grow.
Every dollar invested in your business will become 2 or 3 dollars in the near future. Every dollar invested in everything else will either be gone or worth pennies. Free up your capital so it can work for you.
Free up your time because it is your most valuable asset. I know you have a job and you can’t free up that time. I know you are overcommitted and you are busy. Start saying no. Say no to your friends for now (they’ll understand its temporary). Say no to your hobbies for now. Hide the power chord to your TV and your Xbox. Make the sacrifices in the near term to get out of the rat race and reap the rewards in the long term.
Make sure your spouse supports you – it will be a long road if he/she doesn’t.
Figure out what service you want to offer from this list of businesses I love. Make a list of 10 and go through my analytical approach to vetting ideas and finding opportunities. Feel free to stray from these models if your market analysis, network or skillset warrants.
Utilize my list of essential tools to get off the ground.
Get out and grind. Sell. Service customers. Make money. Work evenings, nights, and weekends. Delay your gratification now and sacrifice your fun and normality to build the life you want a year from now or three years from now.
Spend a lot of time making and analyzing your financial projections. Revamp them daily as you collect data. Get uncomfortable and push through the barrier where most small businesses stop growing and become a job.
Naming your company and securing a domain is hard but very important. Put some time into it and try my method if you’d like.
If you realize your business doesn’t have the potential you thought it did and can’t become what you desire move on. Quit right then and shift gears to your next business. Don’t get emotionally committed to anything. Use your logical mind to make decisions. You haven’t quit your job yet. No harm no foul.
When do you quit your job?
Only you can answer that. Study your pro formas. Study your market. Study the trajectory. How much risk are you willing to take? Do you have a family to feed and a mortgage to pay? What is the worst that could happen?
Customer service is a weak point of most service based businesses. Missed calls. Grumpy overworked employees or owners. Chain smoking unkept technicians. Unreliable. Over promising. Disappointing.
Just answering the phone puts you ahead of most of your competitors in this space. But you can take it a step further and keep customers from even considering another company.
Professional customer service can blow people away. If you are good at talking to people and managing customer expectations in a fun and upbeat manner you will crush it. Plain and simple.
Answer the phone with a smile. Be very upbeat and positive and very friendly. Do this and you are in the top 5% of businesses out there.
Get quotes out extremely quickly. Try to do them in person so you can show off how put together and serious you are and why its worth hiring you over the craigslister that will do it for half your price.
Your competitors show up with dirty clothes. Cut off sleeves. Chain smoking cigs. Looking unkept.
Make sure you or your employees show up with a clean polo tucked in. No smoking. No facial hair. A smile.
Send out your certificate of insurance with every quote. Its a nice touch. Personalize your website and your media so you are likable and your professionalism shows through without giving off the corporate vibe.
Sounds like a no brainer right? It isn’t. If you do these things you’ll be head and shoulders ahead of everyone out there.
Do the little things to make people understand how serious and professional you are and you’ll start converting more sales, charging a higher price and generating much more income.
Its easy to forget that doing business is very much an emotional decision. People are way more likely to buy something from somebody or hire someone who they get a good feeling from.
Don’t be a robot. Personalize your emails. Spend an extra minute on each call learning a little bit about your potential customer.
Show a genuine interest in other people. Find out what makes them tick. Ask questions about their family and remember the name next time you talk to them.
Always have a positive attitude and exude excitement and smile often. It will get you farther than you think.
Don’t try to please everyone. Don’t try to do a little bit of everything. Saying no needs to be a common occurrence. Your service isn’t designed for everyone.
20% of your customers will generate 80% of your revenue. Focus on them and specialize further if possible as you grow.
There are a lot of people who make it their life mission to take advantage of companies. Don’t let unreasonable customers cause stress. You don’t need to jump through hoops and get out of your wheelhouse trying to please everyone.
20% of your customers will cause 80% of your stress. Fire them in a polite way. Your service isn’t for them.
How would you start a service business where you have to have specialized knowledge? A business like yours anyone who can drive can start. But let’s say a business like HVAC or appliance repair, traditionally people that have a lot of experience working in that area eventually decide to go solo and start a company. It seems like these make up the majority of businesses.
First of all a steep learning curve and permitting process is not the majority of businesses out there. Looking at this list 90% of them you can do yourself with a few youtube videos, cheap tools, some practice. Obviously you will get faster and more efficient over time but thats part of anything.
Every business has some level of investment required. The greater the investments the greater the potential reward or potential loss. The investment in these skilled areas is more geared around TIME than money.
To start a waste management company you need a $240,000 garbage truck. To start a business based on a skilled trade you need experience, maybe some education, and likely some certification. You are really investing TIME.
Look at these as barriers to entry and investments. A certification is likely not that hard to get and keeps others out of the market. You want it to be hard remember? Everyone would do it if it were easy.
So its probably unrealistic for you to become a licensed electrician unless you are under 20 or already headed down that path. I get that. But should it be totally out of the question if you are at a dead end job in a dying industry working for the government when you would much rather be working with your hands? Maybe not.
Is making a time investment worth it for you considering all the factors? That is up for you to decide.
There are a ton of trades that you can learn on your own time while you have a full time job. Want to be a specialty carpenter and build home bars or wine cellars for people? Get into woodworking, join a local club, and find a local company that is doing it and is hiring evening and weekend work. Help your friend build one. Build one yourself. Before you know it you’ll feel comfortable doing it and you will be ready to get out and mix it up.
Remember that starting a company is a long game. We are making sacrifices right now so that we can design our life 5 or 10 years from now. We aren’t afraid to work for something even if the reward is a few years out.
The good thing about the this space is that most contractors or tradesmen who own companies are so short on staff that if you are a warm body and will show up you can get a job instantly. Go out and work in the field for a few weekends and see if it is for you.
You can get paid throughout the training process by doing this and it will supercharge your learning and experience as well as help you learn the industry overall.
Its all about risk and reward. You can choose to risk your time or your money. Do your homework and decide if a skilled service is right for you.
This is an analytical approach to identifying and exploring new business opportunities. This is designed around service based businesses but the concepts can be applied to any business.
In order to compete you need to have a competitive advantage in one of three areas: speed, price or quality. The goal here is to look for holes in the market in these areas so you can find a way to carve out customers and earn business.
You should not need to steal customers from other companies to carve out your piece of the pie. Look for services that are in higher demand today than they were yesterday and are expected to be in higher demand tomorrow than they are today.
Choose your competition wisely. Who do you want to compete with? Walmart? Amazon? Chinese manufacturers? Silicon Valley based companies? Big data? Big money? Coders or developers working for $7/hr on Upwork? A mom and pop with a fax machine, yellow page ads and a filing cabinet?
Consider the trajectory of your service or product. Don’t sell something that is getting cheaper all the time. This killed RadioShack (along with a host of other things) and is putting a hurt on a lot of software development and tech firms.
Avoid markets that are targets for hobbyists and dreamers. These people don’t use common sense and make unwise financial decisions. You don’t want to compete with them. This includes restaurants, bars, blockchain, personal training, health coaching, social media app development etc.
Now make a list of 10 possible services that you could offer. Use this list as your resource but don’t be afraid to stray from it. To help with this keep in mind the following questions and considerations:
Now we will form our list of 10 services that we would like to analyze for possible opportunity. The first 5 will be low skilled, low upfront cost and low barrier to entry businesses. For example:
Some people say these are commodity services. They say its a race to the bottom. This is simply not true. Its only a race to the bottom if you try to compete on price. You can always find customers willing to pay a premium for the other two factors: speed and quality.
The next three businesses should be specialty niche services that only a few companies or no companies do but the customer pool is still relatively large and the work is relatively low skilled and upfront time and money investments are relatively low. Examples include:
The larger your city the more specific you can get here. Remember, you don’t need millions of potential customers. You can often create a viable escape from the rat race and even a scalable company with 50 monthly customers. Find a niche and focus on it.
The last two businesses should be high skilled and might require significant training or investments in equipment. Examples:
I love these opportunities. There has been a massive shift away from labor intensive professions as more millennials opt to study marketing or liberal arts and less go to trade schools.
This space is great because the market is drastically growing, the competition is weak, nobody enters these professions because of passion and there is often a multi week lead time to get services like this signaling more demand than supply.
If you put systems in place and simplify the jobs for your employees and get the service to the consumer quickly you can name your price and build a great business.
Now for each of your 10 businesses you are going to study the three main companies in your city that offer these services based on the following criteria:
The most important factor by far. Call each company and play a customer. How busy are they? How long would it take to get a quote and get service? Ask a ton of questions about their busy seasons, how many customers they service annually, etc.
How hard is it to find the companies online? Are they buying adwords? Do they have any digital marketing? Do they have a social media presence? Online reviews? Is their business all word of mouth? What is their quality of customer service on the phone? Do they follow up with you? Do they try hard to get the sale?
How much are they charging for the service? An arborist might charge $800 to take down a tree that takes 2 guys 45 minutes. Are the margins high or is it relatively affordable? Try to estimate the margins.
As you go through this process you will find holes. You will find areas you can provide the service better, faster or cheaper. Thats your opportunity.
When you spot the value add and the problem you can solve its time to get serious about research. Dive into industry trends on IBIS World. Study trends.google.com to analyze busy seasons, competitor size and search terms. Read everything you can read about the service. Study the companies that do the exact thing in every major city in America. There is a company out there that does what you want to do really really well but they do it somewhere else. Perfect. Study them and model your business off of them.
Naming your company and securing the web domain is critical. Give my method a shot if you need some guidance here.
Build a pro forma financial projection model. Use it to estimate the monthly income and monthly expenses. Do a lot of research to properly estimate these costs. Don’t forget to pay someone $15 per hour it really costs you closer to $20 after payroll taxes and workers compensation.
Work to keep your overhead low. Most businesses you can operate with very little in the way of equipment. If you need equipment purchase it on Craigslist. If you need a cargo van buy it for $5k off craigslist or rent one at first. Here is my van buying guide. If you need equipment buy it used or lease it. Minimize your risk here.
Now its time to build your website and get your google my business location operational and get a few reviews on it. Here is my guide to get started quickly and cheaply.
Reach out to me if you have questions or want to get my opinion.
A few things to keep in mind:
Be ready to sacrifice your free time and your hobbies in the near term. Be prepared to play the long game. Be prepared to put away your ego and work smart and hard for 3 years straight before the momentum really picks up.
Remember you will never find the perfect opportunity. There will always be reasons why you shouldn’t do it. If it were easy everyone would succeed. You want it to be hard.
Who is your boss? Who manages your branch? Who oversees your region? Who owns the small business you work for? Who is the most valuable person at your company or in your circle? If you could chose to be complimented by one person at your office who would it be?
Think about that person. You know who it is. Now we are going to study them. Think about their tasks and what they do for the company on a day to day basis. What do they do that causes them headaches? What causes them unnecessary stress?
Now think about that problem they deal with. How can you help them solve it? How can you relieve stress from them? How can you make their life easier?
Figure that one thing out and do it. Take it on. Help in some way. If you can figure out how to take stress away from the key person in your office you will win. You will be invaluable. You will get promoted.
Its not easy. Its not comfortable to do this. Its easy to say well no I can’t do that because I’m a lower level employee. Its not my job. I would be overstepping my boundaries. Remember that life is all about putting yourself in uncomfortable situations and the people who are willing to do that the most are the ones who win.
Figure out something you can help them with and walk into their office or give them a call. Heck even an email would work. Walk up to them and say hey – I notice you deal with a lot of this or that. I think I can take some of that off your plate for you. If you would be willing to let me try I can help with it and I can make time to take it on.
Do you have any idea how refreshing it is as a boss or owner of a company when someone comes to you and asks that? Your whole perspective of that person changes. You see a go getter. You see someone who thinks ahead. You see someone who is a self starter and a go getter. In the 8 years I’ve been a business owner it has only happened to me a handful of times. Those people are now in management and making great money leading the charge at my company.
When you think like this as an employee going about your day you are bound to find opportunities to prove to the decision makers in your company that you are valuable. You are bound to come across a place where you can add value.
Make sure you think this through. Don’t just throw a hail mary and try to make this happen without really analyzing it. Make sure that you can realistically do it. Make sure that you deliver. Start small at first if necessary to gain some trust before taking on something big.
I’ll give you an example of this. Our student storage business is very seasonal. We spend the few months leading up to the busy move out season each year hiring and training 20+ employees at each location.
Early on when we didn’t have a lot of processes my job as the executive overseeing the branch was to make the schedules for the customers to get their items picked up as well as schedule out all the employees to work and let them know when to work, where to show up, and how long they will work each day. On top of that I was also in the warehouse overseeing the unloading and organizing.
We hire a student manager at each location. Generally they organize all the small stuff leading up to the busy season and then work long hours as another laborer or crew leader during the peak time.
One year we had a student manager who took initiative and tried to find a place to add value. He came to us and asked if he could build out a schedule in advance with the crews and the dates and then take it under his own wing to staff each crew, notify everyone of work schedules, and basically manage all the employees.
We realized that if we watched closely and kept tabs on what he was doing it was low risk so we turned him loose. It went amazingly. We serviced more customers than ever and it was much less stressful for me as the business owner. Instead of scheduling customer pickups, employees, and the warehouse I only worried about the customers and the warehouse. The manager handled the employee schedules which is generally the most stressful part.
He looked at my job during the busy season and figured out a way he could take stress away from me. He focused on it and communicated well with the employees so more of them showed up for their shifts and they were more prepared. We instantly gave the manager a raise, he got real world experience, and it was great for everyone.
Three years later and that employee now works full time on our executive team and we plan to hold on to him for as long as we can afford to pay him.
Housing is so expensive in America’s top 10 cities that only the wealthy can afford to buy a home or even rent an apartment. What factor is at play that everyone is missing?
I feel very strongly about this one and I have a bit of a unique opinion.
Housing is astronomically expensive because there isn’t enough of it. There are millions more people who would like to live in our top cities than there are homes available for rent or purchase.
So thats it. Not enough supply. If we could build more housing we would solve the problem. Why can’t we?
Developers are willing and able to build the housing. They can build high rise apartment buildings for $300 per square foot. So if they make a healthy profit of 50% it should cost a consumer $450,000 for a 1,000 sf 2 bedroom apartment. So why does it cost 3-4 times that?
The local planning boards and zoning laws in our major cities limit the density of our housing developments. They restrict the height of our apartment complexes.
Who sits on the local planning and zoning boards? Members of the town. Local property owners.
So the local home owners control the zoning and new development but they also own property in the city. What happens if they limit new development and new housing supply?
Their own home gets more valuable.
Why in the world would the planning boards and zoning boards make it easier for developers to build? They would lose money.
So they don’t. They limit supply of housing to protect their own investments. The local home owners win.
The city loses. The middle class loses. The lower class loses. Local businesses lose. Everyone else loses.
Have you ever been to a town planning or zoning hearing? You should go. Watch the home owners cry and send the developers packing. Watch the “not in my back yard” outcry.
Drive through the suburbs of Boston and look at the yard signs that read “VOTE NO on the Route 2 development”. Every 3 million dollar 5,000 square foot single family home sitting on 3/4 of an acre has one.
Its easy to forget that doing business is very much an emotional decision. People are way more likely to buy something from somebody or hire someone who they get a good feeling from.
Don’t be a robot. Personalize your website. Personalize your emails. Make people read the “about us” section of your website and begin to like you.
Show a genuine interest in other people. Find out what makes them tick. Ask questions about their family and remember the name next time you see them.
Always have a positive attitude and exude excitement and smile often. It will get you farther than you think.
Evenings are tough because they are not as predictable as mornings. You have social events, work emergencies, date nights etc. I manage a predictable evening most days and here is my routine:
First I make a to do list for tomorrow. Everything I need to do organized from most important to least important. This clears my mind and allows me to turn off the work mode.
Then I prepare for the morning routine. The goal is to take any and all decision making out of my morning. When I get out of bed in the morning I want to be able to start my day on autopilot. No emotional energy required. No variance. What I’m going to do in the morning is as good as done.
So I lay out my clothing for work, hang my towel on the shower hook, grind beans and set my coffee pot to instantly brew at 6am, get my bike ready to workout and ride on my trainer along with my water bottles, kit, and towels.
I then put my question or problem on my google document on my computer and put my computer in airplane mode. I put my phone on the charger in my office and leave it there. No checking email, social media, or texting after this point around 7pm.
Then I usually put my baby to bed and spend time with my wife.
My goal is to be asleep by 10pm so at about 9:15 I take a hot shower and meditate through it taking deep breaths throughout. At around 9:30 I brush my teeth and then spend about 15 minutes stretching and using my self massaging tool to ease tension in my pressure points on my back, in my shoulders, and on my neck.
Then its 15 minutes of fiction reading on my kindle before sleep. No business books, no input from social media or work email or my mind will jump start and I’ll find myself on my computer in my office until 1am.
After the fiction reading I lay on my back and meditate until I fall asleep. And my meditation consists of simply taking deep breaths and trying not to think. This is nearly impossible but I practice not pursuing thoughts and instead letting them pass through and go on their own way. This works really well for me.
Thats it. Give it a shot and see how it works for you!
This smoothie has evolved over time and has turned into my daily mid morning snack or lunch replacement. Very healthy and easy.
Ingredients in order:
Notes: This Hamilton Beach blender works best of the 5+ I have tried.
Fill 1/4 of the blender with frozen blueberries. Then put a few fist-fulls of kale on top of it (don’t pack it in or you won’t be able to get it to blend). Then put WARM or room temp water up about one or two inches into the kale. Now blend it to get the kale to pull into the water. If it gets jammed add a bit more water until you get it to blend.
Then add the rest of the ingredients and blend it.
This smoothie is quick to make and has a great range of protein, vitamins and fiber. You can add peanut butter if your goal is sustained energy or meal replacement but it adds a lot of calories. It isn’t meant to taste like ice cream. Suck it up and get used to the flavor! If you must add sugar you can replace the water with orange juice.
A pro forma financial projection model is your best friend.
Use Excel or Google Sheets to build out your models and do a lot of research on your industry standards and fill in blanks with actual expenses and revenue estimates per customer.
Costs will vary at different customer levels so make educated (and research based) estimates based on customers per month. At 10 customers per month go down each line expense item and build the model so that the overhead and variable costs are accounted for.
Then create formulas based on the customer fluctuations.
Run at least 3 models to account for uncertainty and variability. You will need a “worst case” model, an “expected case” model and a “best case” model with different customer figures.
Remember there is bias here and people are more likely to overestimate customer numbers, revenue and underestimate expenses.
Can you still pay your bills in the worst case model? If the answer is no this is a high risk model and you need to make a plan for this situation. How will you liquidate your equipment? How can you get out of your overhead?
Before you hit the ground there will be a ton of variables that you cannot possibly put an accurate figure on. As you operate yourself and collect data you can begin to fill in the blanks.
This is a living and breathing document that should be updated monthly and revamped, studied and used to get the big financial picture and minimize your risk.
If you make every financial decision at your business with this document as reference you will be much more likely to win.
Check out my sample pro forma here:
This is a workout I developed while in college and have found it to be an excellent way to quickly and efficiently build upper body definition and muscle. Make sure to accompany this workout with cardio on the other days of the week.
No long breaks. No catching your breath. You go through each workout of the set quickly and take only a 3 minute break between sets.
Schedule: 2x per week
Directions: Go through this workout without putting the dumbbells down. 48 total reps with the dumbbells before the pushups and abs. First set 12 reps of each. Second set 10 reps of each. Third set 8 reps of each.
I usually use 30 lbs weights. You may need to start with 15 or 20 lbs or you may need 35 to 40 lbs. Use your judgement here.
One set equals:
Put dumbbells down and go straight into:
I do the crunches using the Ab Ripper X style of in and outs on the middle and oblique v-ups on right and left side.
This is one set. I do 3 and I’m absolutely fried after the 15 minute workout. Your first week or two you should only do 2 sets and make sure to use light weight. If you are really sore take an extra day’s rest.
Expensive cities with high cost of living have amazing opportunities for service based entrepreneurs. NYC, DC, Boston, all of Cali, all of Canada, all of Europe. Anywhere where hourly labor is in low supply.
Here is why:
First of all there is a huge demand for services in expensive cities because people and companies are earning more money and specializing more. People are getting really good at one thing, earning a bunch of money doing that and outsourcing everything else. Nobody is bothering with their lawn, cleaning, basic maintenance, etc. 20 years ago 5% of homeowners outsourced lawn care. Today 40% do. That number is higher in expensive cities and will only grow over the next 10 years.
The second one is the big one. Labor is expensive. Not many people are willing to work in hourly positions. This makes it hard for MOST service companies because they have trouble staffing, keeping up with demand and maintaining a consistent workforce and a consistent service to the consumers. They end up offering a very slow service because they are always 2 or 3 employees shorthanded. Most owners run around saying “I can’t hire anyone worth a damn.” or “I have to pay my employees too much to make any money.”
This sounds like a reason to avoid major cities but its not. This is your opportunity. This is where a good operator can win.
Stop looking for better people and start simplifying your operations so normal moderately trained employees can thrive. Take as much off their plate as possible. Build a streamlined training process. Implement tech into your day to day operations.
If you do this you can offer a more consistent service, you can offer it to the consumer much faster and you can basically name your price. You can charge a higher price and thus pay employees better to keep them around. You can stop competing with the providers on craigslist.
You can grow a viable scalable company.
When you are starting a company time is of the essence. You need to learn and sell and get your service to market as fast as possible. Your opportunity cost is huge. You could be earning in the workforce or pursuing any number of opportunities.
Its time to get uncomfortable. Its time to set goals. Not just normal average vague “we’ll see what happens” kind of goals.
I’m talking about serious uncomfortable goals. Goals that can be measured with real numbers. Goals that have deadlines and dates attached.
I will put out 20 yard signs this Saturday. I will attend two open houses and hand out 250 flyers this weekend. I will knock on 30 doors after work. I will build my website and have it completed by tomorrow at noon.
Now the most important goals are the goals tied to your financial projections. The goals that will tell the story on the overall health and potential of your business. The goals that if you don’t hit you decide to move on and the lofty goals that if you do hit you decide to double down and get aggressive or quit your job.
If I don’t hit ______ in sales in the next _____ days I will _________. If I don’t get ________ customers in the next _________ days I will move on to my next business. If I get ______ customers in ________ consecutive months I will double my marketing spend.
You have to give these goals a shot by really getting after it with the marketing and sales goals you can control. You can’t just set lofty goals and pray they get accomplished. You have to get out and make them happen.
Get out and make your own luck!
I hear people say all the time that the key to success in entrepreneurship is finding great people. That if you can find people who care about your business like you do you will succeed.
News flash. Nobody will care about your business like you do. Why would they?
Stop looking for people like this and blaming the world when you can’t find them. They don’t exist. And if they do you can’t afford them.
Simplify the job so that normal people can do it well. Stop asking your employees to be good at 20 things. They’ll end up being crappy at everything. Your customers will get a shoddy product. Turnover will cripple you. You’ll be inundated with questions and problems. Training will be nearly impossible. Scaling isn’t feasible.
You will end up joining the ranks of overworked business owners that complain about not being able to find good employees.
Simplify things so normal people can deliver your service really well and you’ll be on your way!
Take as much as possible off the plate of your field reps. Take your billing online. Have them direct customer service to someone who specializes in it. Do not let them give prices or quote jobs. Let them focus on the one thing you really need them to do so that they can do it well.
“Life begins at the end of your comfort zone.”Neale Donald Walsch
If its comfortable it probably isn’t getting you anywhere.
Getting that safe job and going to that safe college and minimizing as much risk as possible is comfortable. But is that how you get ahead? Is that how you design your own lifestyle? Is that how you get wealthy?
Its not. The safe comfortable way will lead you to a perfectly normal average life. What is the fun in that?
The way to get ahead is by getting uncomfortable. To take the road less travelled. To put yourself out there and risk failing. To approach the beautiful woman at the bar. To reach out to the business owner down the street to sell him on a service you are offering. To agree to a public speaking engagement at your local college.
Most businesses stop growing when the owner gets comfortable. Delegation is uncomfortable. Hiring and training employees is uncomfortable. Building a business that can run without you is very uncomfortable.
Its comfortable to get really busy and keep offering your service yourself. Its comfortable to keep working really hard and long hours on the ground.
Its uncomfortable to shift gears and focus on building systems and bringing in new business while your new hires offer your service. Its risky. Its hard.
But thats the key to building a business that can give you the life you want.
If you are exactly where you want to be in life then keep doing what you are doing. If you are on pace to accomplish your goals and you are happy with your life right now then this advice isn’t for you.
But if you have a goal or would like to make a change then its time to get serious about your time.
Its your #1 asset. You only get so much of it. You can’t replace it.
Say no to the distractions. They cripple us. Say no to the fantasy football. Say no to the Xbox. Say no to TV. The average American watches 5 hours of TV per day. PER DAY! Say no to late night sports. Say no to the news. Say no to social media.
Say no to the norm that says you have to trade your time for money. Say no to working for the man for 40 hours a week and commuting an hour each way to get there.
Start saying no to people. Start saying no without feeling like you have to give a reason. Start saying no to the people who don’t respect your time.
Get serious about building the life you want. Put your time where it matters and invest it in getting closer to your goals. Temporarily shut out your hobbies and your fun in the near term to achieve your goals in the long term.
Delay your gratification. Put your time where it matters now so you can take it all back 5 years from now and do whatever you want to be doing the rest of your life.
Just because you have invested time, money and energy in something does not mean you should continue.
Humans are wired to consider the past when making decisions for the future. This leads us to a lot of bad decisions.
This leads us to operate a business way past the point we should have pulled the plug. It leads us to miss the information that is pointing us and telling us to close the doors and cut our losses. We waste more time. We waste more money. We hope for a miracle. We work harder. We work longer hours.
If data and logic and analysis tell you that its time to shift and pivot you should not waste another second. Time is your most valuable asset.
If you spent 3 years and $200k on a law degree but you hate your life and logic is telling you it will never get better then you should shift gears and pivot as soon as possible. Don’t waste another day.
Its hard. Your heart is in it. Your emotions are at play. Try your best to see past that and make the logical decision.
Something bad just happened. Something went wrong. A problem. Most people just react. They go with their guts.
Stop and think. Stop and think about how your emotions effect your decisions. Realize that between every event and your reaction there is a split second that you get to choose how you react. You get to choose how you feel. You get to choose positivity or negativity. You get to choose a freak out or cool headedness.
That is the basic principle on Stoic philosophy. The stoics believe there is no bad or good in the world there is only our decision to react a certain way. Read The Obstacle is the Way by Ryan Holiday. Or search Ryan Holiday on YouTube.
The goal in business and in life is not to ignore the emotions like anger and fear and anxiety. But instead to put them in perspective and keep them from clouding our judgement and making bad decisions.
Don’t start a business based on your own selfish desires, passions or hobbies. Don’t filter information based on what you want to hear and what supports your beliefs. Don’t turn around and slug the guy in the bar who is acting like an idiot.
Think logically. Change your mind often. Don’t make decisions while angry.
This is a skill that requires serious practice. Nobody is perfect. You have to make a habit of working on these things every day. Analyze each day for how you could have reacted better. How you can improve.
You’ll be better off and more likely to make great decisions.
I’m on a mission to help as many people as possible get away from the rat race. The 40 hours a week for the man with a commute each way to get there. I want more people to design their own lives. I want more people to give entrepreneurship a shot in the area with the highest chances of success. I want to help more people with jobs get ahead by thinking like an entrepreneur.
This blog is all about doing common things uncommonly well.
Even if its a one person shop or a lifestyle business. Those are sometimes the best.
Do you want to help? The podcast is my focus so I need help managing my social media, this blog and more.
Have a story of how you bucked the norm? I’d love to feature you on this site. Reach out to me.
There is no get rich quick scheme. Its hard. It will take time. It will take focused intensity.
This is why most people aren’t able to stay healthy. It takes focused intensity over time. This is why most people are in debt. It takes focused intensity over time. This is why most people don’t win at entrepreneurship and 90% of businesses fail.
Ask any social media influencer or professional YouTuber or blogger what it took for them to get a following and start winning. In most cases it took YEARS. Everyone wants to be an online influencer but it rarely happens because people get discouraged when they are 6 months in and it turns from fun to work and there is no end in sight. They aren’t willing to keep at it for another two years with no pleasure and profit and fame.
If you really want to buck the 9-5 and start your own company and design your own life it takes time.
You have to make a 5 year plan. You have to swallow your pride and get out and work. You have to cut all the distractions and hobbies out of your life temporarily. You have to cut out fun temporarily.
It will be fun and exciting for a while. 3 months or so. Then it becomes work. Most people give up. If you are still hitting targets and gaining momentum keep at it. Stay the course and you’ll win.
I’ve been working on a morning routine for about a month now and have had great results. I forget where I read about this. Maybe Tim Ferriss.
Before I go to bed I write a question or problem I’ve been working on with my business or life in general at the top of a google document. I close all other windows and put the computer in offline mode.
The next morning I wake up and brush my teeth. Then I drink a full glass of water and a cliff bar while making coffee. No phone or input at all. No checking emails. Then I do a 15 minute workout routine. Cardio 3x per week and weight training 2x.
I then read the question at the top of my google document before taking a quick hot shower. While in the shower I purposely breath very slowly and try to let all the thoughts pass through my head without focusing on any of them. I’ve gotten better now and a few showers I have been able to meditate through the entire thing.
As soon as I get out of the shower and get dressed I sit down at my computer with my coffee and begin to type out my thoughts. No phone and no email and no social media. Just this blank page with the question on top. My computer is offline and my phone is still in the other room.
I start thinking and I start writing.
Bullet points at first. Some days I write for 20 minutes and some I write for 2 hours depending on how much time I have. Some days I have 5 or even 10 pages of thoughts out on paper. I am often super productive during this time get a lot of very important business planning done.
It is amazing how this makes you feel and the insights that come. This blog and podcast are a product of this creative time in the morning.
Say no more often and without feeling like I have to justify with a reason. Turn down a few opportunities that don’t make sense for me right now. I got ahead by saying saying yes to everything. Now it is holding me back.
Treat my time like it is my most valuable asset. Take back control of my time and disassociate with those that don’t respect it. Stop stealing time from myself.
Be more aware of my ego and how it is keeping me from learning new things because I think i already know them
Keep emotions out of my decision making. Anger and passion cloud my judgement. Get better at controlling my emotional response to events. There is a moment in between an event and my reaction that I need to get better at taking control over.
Specialize. Realize that I can’t be great at two things at the same time. Focus my professional energy in the areas that will produce the most value for me.
Avoid over valuing sunk costs. Time and money mostly. Switch gears when necessary.
Stop trying to control and preach to my family and friends. Try to learn from them instead. Listen more and talk less.
Get better at showing a genuine interest in other people. Stop thinking and talking about myself all the time. Learn what the people closest to me are afraid of. Learn what makes them tick. Learn what they are afraid of and what they are passionate about.
A lot of people run around networking as if its the key to success. I have bad news. The network doesn’t come before success. It comes with success.
You earn a network just like you earn money. You gain it over time by providing value to people. A network is mutually beneficial. People invest time and resources in people who bring something to the table. People invest energy in people if they can find mutual gain. You help me. I help you. That is a network.
It has to be a win win.
If you have nothing to bring to the table your network will never grow. You will never get recommended to meet people. People won’t come to you to do business with you. People will not go out of their way to help you get ahead unless there is something to gain. They won’t put their neck out to recommend you for a job or to a friend unless they know everyone wins.
Powerful people will give opportunities to people when there is a chance at mutual gain. When there is a chance to make money. When there is a chance to solve a problem or reduce stress.
I spent some time recently thinking about the most valuable people in my network and how I met them. I didn’t meet them at networking events. I met them because somebody recommended me to them because they thought I could help them with a problem they were having. There was mutual gain. I could provide some utility.
You have to earn your network. If you aren’t good at anything or you aren’t helping yourself your network will never grow. You have to be a master at something. You have to be able to add value somewhere.
A network grows when someone says “I know a guy that you need to talk to about that”. Be that person! Be that person that people refer people with certain problems to.
Get really good at something. Help powerful people solve a problem they are having. Add value. Don’t build your network – Earn it.
Ford E Series vans are amazing assets and can be purchased used very affordably. We got our first van on craigslist in 2011 for $1500. Vans that we purchased 5 years ago for less than $4k are still going strong today. We now spend around $5,000 to $7,500 to get a presentable and very reliable van. Do whatever fits your budget but no need to lease a new one or buy one for $10k plus no matter what.
These can be used for all types of service businesses. They are much more affordable than pickup trucks and the contents of the van is more secure and safe from sun and rain.
The cheapest place to buy vans is Chicago. The problem with this is they are rusted out from the salt. Look for southern vans in Atlanta or Phoenix. Travel if necessary to get a good deal. Southern vans are usually in much better condition.
Extended vans are moderately more expensive but haul 25% more stuff. Buy one of these if you can. The E350s have V8 Tritons and can haul large box or open trailers (they get 10 MPG while E150s can get 15+). They have just as much power as a big pickup truck for hauling. Diesels are more expensive and harder to find but last longer and get better mileage.
This is our rough checklist of things to keep look for when buying a used van.
Questions for the owner before you visit:
What to bring with you:
The Code Reader:
Just plug it in, turn the key to the on position and wait for it to beep at you. It gives an easy to read green/yellow/red led light. If its green, no problems have been found. You’re good to go. If its yellow, look to see which emission monitors have not run. The instructions will tell you which black circle in the upper left side of the screen is blinking. Be wary, there may be a lurking problem such as bad catalytic converters or oxygen sensors. If its red, diagnostic codes are present, may or not be a big deal. Google the codes that pop up and see what you find.
The visual inspection:
Start up the van and listen to the start. It should be strong and clean without knocks or noises. You should not hear any abnormal sounds. Abnormal sounds include, knocking, tapping, clicking, ETC. all of which indicate differing degrees of problems. Note, some engines may make excessive noise at initial start-up but quiet down after a minute or two. This is normal. If the noise is still heard after the engine has idled for a few minutes there is an internal problem. As long as no abnormal sounds are heard, its time to check the transmission fluid.
A transmission rebuild or replacement is going to cost around $3000+.
The test drive:
Put your foot on the brake and shift the van all the way through all of the gears. Do this with the center console taken out of the van so you can see the transmission. Listen closely to it as you shift. It should not make any loud noises. It should shift smoothly.
The brake pedal should feel firm. If it drops all the way to the floor with little effort or is hard as a rock, there’s a problem and I don’t recommend driving it.
Drive the way you normally drive and see how the vehicle responds. Try to drive over bumps to see if it makes noise over bumps. Also drive around in circles to test the steering effort. At slow speeds turn the steering wheel all the way to the left and right. Should be smooth and easy.
Drive the van and while at about 20 mph shift it from drive to overdrive to 2 to 1. Listen closely to the transmission and how it reacts.
Have the person behind you following look for different colors of exhaust coming from the tailpipe. White is normal when it’s cold until the vehicle warms up. Blue, black, white (after warm-up) all indicate internal problems with the engine.
Test the brakes with strong stops and long slow brakes. A pulse or a wobble means the pads or rotors are out of sync and likely need service. Sometimes it only pulses or wobbles at greater speeds. Squeaks aren’t good but can sometimes signify dust on the rotors. Most likely it means you have metal on metal which means the pads are toast. A full brake job on a cargo van with pads and rotors is going to run $1,000+.
An easy (but not perfect) way to check strut wear: Get the van up to 15 mph then hit the breaks hard. The nose should go down then return to level. If it goes down, then up then down again to level the struts are worn and likely need replacing. Same works in reverse.
Get the van up to at least 55 MPH on a local highway. Accelerate quickly and slowly and feel for wobbles or noises while driving full speed.
Don’t forget to turn on the air conditioning (if equipped) and the heater. Make sure it gets hot and cold. Also should work in all positions (forward vents, floor, defroster, ETC).
When you get back to the lot shut down the engine for a few minutes. Do the fluid inspection under the truck once again.
Make sure the title is clean and run the VIN number online.
Should you find any issues, have it professionally inspected or simply walk away. Especially walk away if they do not agree to have it professionally inspected.
Negotiate hard and offer an all cash price. Use cosmetic blemishes to negotiate discounts. Use other concerns that came up during this inspection to find their lowest number.
Call your insurance company and get it added before you drive away.
If you shop in the $3k and under range or even higher in the North you will have some rust to deal with. Get white spray paint and black spray paint along with some sand paper and primer.
Sand the rust off the bumper and primer it and paint it black. Sand the rust if possible on the body and do the same with white paint.
Remember that a nice vehicle decal is a great investment so don’t be afraid to spend a few hundred bucks to get your logo real nice and big put on the side in vinyl. If you get a nice used van you think you will have for a while spend $1500 or so and get it fully wrapped.
There are two main factors that lead to happiness and joy in the workplace (and in life). The first is being appreciated and valued and respected. The second is being listened to and having input.
Both of these are all about communication – not surprisingly.
People want to know they are making a difference. Compliment them and show respect often. Words of affirmation. When they do something well or they have a win in life speak up and let them know that you noticed and that you are lucky to have them.
The second part is ask for input. Even if you already have a plan and you don’t need their consultation remember that people long to be listened to. People want to be heard. So listen. Ask them once every few weeks in a very sincere way how things are going with life. Put your hand on their shoulder and tell them “listen I am not on the ground as much anymore. You are on the front lines with our customers and delivering our service which is the most important job. Have you noticed anything out there? Do you think we are still doing the right things and thinking the right way as a business? Is there anything you would recommend we try to change to be more efficient? Think about this and bring it up to me if so. “
You will be really surprised what kind of input you get back and how valuable it is. Most importantly you will learn a lot about your employee and the way they think. You will learn if they are the type of person who you want to keep around or if there is another job or area of the company they would be better at.
This is a great way to get your employee, wether they make $15 or $100 per hour, to buy in to the company and begin to care about you and your bottom line. They will instantly feel like they have some responsibility for what happens. They will feel valued and heard and like they have some responsibility over the trajectory of the company.
This communication is really what creates a culture. If you show respect for your employees it creates culture. If you compliment your employees it creates culture. If let them know you are listening to them it creates culture. Culture isn’t about ping pong tables and beer kegs in the office. Culture is about how people are treated. Culture is about how people are feeling when they are doing what they do all day.
Focus on it because its important!
Side note: Remember to maintain authority and make it clear that you aren’t opening up the flood gates to freelancing and doing whatever they want. You are still the boss. You still make the calls. You aren’t their buddy to goof around with and you require respect.
This is bad advice and I hear it all the time. Start something that makes logical sense. Enjoy the process. Enjoy the relationships you will develop along the way. Enjoy building something. People who think with their hearts instead of their brains lose money and waste a bunch of time. When you operate on passion you are more likely to trudge on down the dead-end road. You are more likely to make poor decisions with your money. You are more likely to get into a business in the first place that is high risk and low reward. I’m passionate about beer but I sure as heck wouldn’t start a brewery. I’m passionate about food but I wouldn’t dare get into the restaurant business. Use your brain and be passionate about entrepreneurship!
I have bad news. You probably can’t change the world. Especially if this is your first company. This is like trying out for the Lakers when you haven’t ever touched a basketball. Build your first business. Take the next opportunity and build your second business. Get the momentum behind you and then you can think about influencing serious change. Start by changing your neighborhood!
If success is being able to pay your bills and feed your family – then yes. But in general you know how I feel about this one. Everyone works hard. This is America. You can’t succeed in business just by working hard. When you think you can solve every problem with hard work you miss all the warning signs and your business fails slowly over the course of several years and you sacrifice your health, self confidence, relationships and the financial well being of your family. Make sure you are able to see the signs.
There are tons of reasons why you should give up. Your brain is telling you to give up. Your market analysis is telling you to give up. Your customers are telling you to give up. Your spouse is telling you to give up. Your financial statement is telling you to give up. Determination is a great quality when there is an attainable goal in sight and you are hitting the targets along the way. The people who never give up parish with those that work really hard and think with their hearts and not their brains.
I’ll say first I am very grateful for my time at Cornell. I met great people and learned a ton about life. But what you have to give up to get accepted and the traits that are rewarded in the Ivy league are not transferable to success or happiness in life. People there don’t know how to communicate. They are sheltered and coddled so much by their parents they don’t understand how to solve their own problems or deal with adversity. In the Ivy League you are rewarded for fitting in and doing as you are told. I’m teaching my kids what they need to know at home and sending them to public schools.
The hardest part of business is not finding the right people who are capable of doing your job. The hardest part is designing the job to be so easy that anyone who is qualified can do it and anyone who is qualified can thrive. Setting your employees up for success is the key. The people who give this advice had over complicated job descriptions and tons of turnover. Don’t make the same mistake they did.
This is probably the one that I hear the most. Or at least the “I don’t have an idea” excuse for not being an entrepreneur. Our media glorifies new ideas. Shark tank glorifies brand new services and brand new products. The books we read about entrepreneurs glorify the forward thinkers and the risk takers. You don’t need a new idea! You just need to find a growing market that has a hole in it somewhere. You just have to add a little bit of value. Faster, better or cheaper. There are thousands of markets in thousands of cities. You think they are all perfectly efficient? You don’t need to have a new idea to escape the rat race. You just have to do something a little better!
Hopefully everybody knows by now that this is not the way real entrepreneurs think. Ideas are a dime a dozen. The execution is the hard part. I would go as far to say that you should always share everything with everyone. Your competitors aren’t paying attention and your network will grow and so will your opportunities.
This is bad bad advice. We’re in America. You can divorce your career 10 times over and you get rewarded for it. People switch jobs and switch industries all the time and when they do they usually get way further ahead in life than the ones who don’t. Unfortunately our culture is starting to feel the same way about marriage but that is another topic for another day.
First of all my children have relatively zero chance of getting accepted into the Ivy League. They won’t have all of the extracurricular activities required to get accepted. They won’t volunteer 20 hours a week. They won’t have incredible test scores. They won’t have a sob story to tell in their application letter.
Lets assume hell froze over and they did get accepted. Would I send them?
The answer is no. I wouldn’t. Getting into a top 15 college is so competitive nowadays that its a full time job for the entire family to make it happen. They must push their children to do a bunch of stuff they have no desire to do. Stuff that has no utility later in life.
Lets think of the traits you need to get accepted. Very good at standardized tests. Very good at holding a position in student government. Very good at schoolwork. Very good at following the rules. Very good at fitting in. Very good at doing what everyone else is doing. Very good at complying.
Now lets think of traits you need to succeed in life, business and relationships. You have to be very good at communicating. Very good at socializing. Very good at making friends. Very good at doing hard work. Very good at dealing with failure. Very good at handling surprises. Very good at leading others. Very good at helping others succeed with you. Very good at holding down jobs when necessary.
People who succeed and lead happy lives have street smarts. They have experience figuring out life problems on their own. They have emotional maturity. They thrive in social situations and enjoy learning from and interacting with real humans. They can operate without a safety-net or helicopter parent.
Kids who get into top universities are horrible at all of these things. They can’t carry on a conversation. They can’t work with others. They can’t socialize. They can’t deal with failure. They have never been dealt a surprise. They have never dealt with a problem without leaning on their parents. They have never worked a summer job doing manual labor. They do not understand how money works.
They are zoo animals. They have been coddled and guided and fed their entire lives. They are great at doing as they are told.
They got into the Ivy League because their parents worked hard to get them into the Ivy League and they are good at complying.
When zoo animals get let out into the wild they starve or they get eaten.
Let me tell you that I am very grateful for my time at Cornell. I met amazing people. I met down to earth people. I met my wife and my business partner – the two most important people in my life. I learned a lot.
But I’m sending my kids to public school. The most important lessons in life you learn in the household. I’ll do my best to teach them those things. The rest is up to them.
Business is all about momentum. If you can get in the mindset to “add value first” to gain your following and build your brand you will be a lot better off.
Sacrifice profits in the near term by discounting your service or products with the goal of gaining a following and securing value later.
In “offline” industries you see self storage facilities give the first month free. You see subscriptions like Netflix give away a free trial period. You might see a home services company give away a free service at first in the hopes of gaining a long term client.
I have a friend who owns a wealth management company. He makes his living by advising really rich people on how to minimize taxes and manage their assets/companies. He goes into every sales meeting with prospective clients with the goal to give away as much information and add as much value as humanly possible. All the advice he would usually charge for he gives away off the bat. I asked him one day if he ever worries about people taking notes and going to their accountant and doing it all themselves.
He said sure that is a risk but what ends up happening is that I differentiate myself from my competitors and gain instant trust with the potential client. Most of the time we bring on the client on the spot and if not they usually come back six months later when they need more advice and we start our relationship then.
This can be applicable to so many industries. Amazon is still playing the long game and adding value while sacrificing profits. Dave Ramsey built an empire giving away consulting on public radio.
There is always that fear, especially in small young companies, that you really have to capitalize on each early sale to validate your model or feed your family. So you try milking everything out of the client or customer up front. You can differentiate yourself by thinking differently here.
Give away your first service. Invest some time in showing off what you can do to get future clients. Charge a low price at first to get volume and learn the business.
Delayed gratification is the key to success. The marshmallow test. Amazon still hasn’t eaten the marshmallow.
If you had to start all over right now what business would you start? What sector would it be in? What sectors would you avoid? How about real estate?
I’ll tell you what I wouldn’t go into – and thats Tech. Its mature. Competition is strong. The market isn’t growing anymore like it used to be. Its getting cheaper and its a race to the bottom right now.
I also would avoid a new product. Again the competition is strong and the market isn’t there. You are spending tons of money to educate a market because nobody knows its out there. Not ideal and high risk.
Retail is also brutal. Online retail has boomed and flattened. You are competing with China and all goods are turning into commodities. Its a race to the bottom.
Online content and trying to become an online influencer and build a brand around that is also a tough business for those starting out right now. Everyone wants to be an instagram influencer or a YouTuber and its getting harder to carve out your niche. The amount of people on their phones scrolling or watching youtube videos is nearing its peak. The market isn’t going to grow forever. The people in that business need to double down and milk the golden goose while shes still there and start leveraging other opportunities and think hard about where the market is going and where they are headed.
America is a service economy right now. Its exploding. Specifically in the service businesses I would target those that customers sign on for scheduled service over and over again. The subscription model. Where a customer is going to utilize your service weekly or bi weekly or monthly for as long as you can keep them on board.
I think pest control is a great business. It would be relatively simple to scale and easy to train employees. Customers can stay with you for 10+ years so you could do creative things to get new customers in the door knowing they are very valuable in the long run. Same with lawn care and lawn treatment. I love the home service businesses that are not just one time hit and runs.
I also love businesses that are seasonal because you can plan and think ahead and rewrite your business plan in the off season and improve leaps and bounds based off the things you learned during the peak season. In our seasonal business we are really able to analyze our market and find our wheelhouse every year and focus on it. Its a common theme at Storage Squad that they pay us the big bucks for our work in November when nothing is happening and we aren’t servicing any customers. Thats when the real advances are made. We’re working in quadrant 2 and nurturing our wheelhouse.
I also love businesses with the opportunity to lead into specialized real estate. Real estate is the end goal because of the massive tax advantages and passive stress free income that comes along with it. However the real estate most people invest in is so competitive there are no deals left. If you are buying rental houses on Zillow you are competing with 1000 other buyers in any neighborhood. Everybody wants to own rental properties or buy and flip because its the sexy thing to do right now and the TV shows on HGTV glorify it and make it look easy. I hate that. If you are going to get into real estate and think you can just go on Zillow and find a good rental property you are sadly mistaken. If its on Zillow you are too late. You have to find a competitive advantage. Cleaning up tax liens or estates. Buying foreclosures. Doing your own repairs and remodels. You have to find additional ways to add value or its very hard to thrive.
I would also love to start a business that leads into real estate in a niche market where you aren’t competing with a lot of other players. That is where the real value can be gained. Examples of this would be warehousers or distributors because it leads into warehouse and commercial assets. Maybe a vacation rental management company that leads into vacation home assets. It was my experience in the storage industry that lead me to self storage assets.
But honestly. The number one business would be the trades. I’m encouraging my kids to be electricians. These industries are so far behind everything else when it comes to tech, customer service, marketing and sales that implementing these things I talk about on this blog would put you leaps and bounds ahead of everyone else in the industry. None of the owners of other companies work in quadrant 2 and think about their wheelhouse. They are all just running around working to keep their head above water.
Time is your most valuable asset and there are four areas that you can spend your time in life.
Successful people spend the majority of your time in the second quadrant. The stuff that is important but not urgent. In life this is your health and your relationships. In business this is your forward thinking analysis. Your strategy. Your technology. Your training systems. Things that prevent problems and fires from taking over your time.
Too many business owners spend too much time in quadrant 1. They are running around putting out fires. They are working 15 hour days. They can’t come up for air. They are doing things that have to be done right now because they are emergencies or problems. The deadline is tonight. I’m working on it now because I have no choice.
This goes back to working hard but not smart. If you work smart you are taking care of the issues before they become problems. You are spotting trends. You are studying your competitors. You are analyzing your training systems. You are developing employees and their roles.
Set aside time whenever possible, maybe on the weekends at first, to do some work and thought in quadrant 2. Put systems in place to solve some problems before they become urgent and it will free up even more time to work in quadrant 2.
Stay ahead of the game by working in quadrant two and you’ll have an advantage over your competitors. You will be able to spend more time developing your competitive advantage. You will spend more time on bringing in new business. More time on training and developing members of your team that can make their own decisions and solve their own problems.
You will spend time taking care of your health and your body and you will live longer and have more energy. You don’t want your health to move to quadrant 1 and become urgent.
The main advantage to working in quadrant 2 is that you can spot issues that arise before they take down your business. Markets change. Competitors join the market. Technology changes. The market shrinks or grows. When things change and business owners are not keeping up with the overall state of the market and the company little problems can become big problems and lead to failure.
The 80/20 principle is my favorite and the most important principle to understand in life and in entrepreneurship.
Its says that 80% of your results come from 20% of your efforts. 80% of your stress comes from 20% of your environment. 80% of your joy comes from 20% of your activities. You name the result. 80% of it is generated by 20% of your efforts.
This applies to everything. 80% of your revenue comes from 20% of your clientele. 80% of your stress comes from 20% of your customers. 80% of your work is spent on 20% of your customers.
I call the 20% your wheelhouse.
The goal is to understand the wheelhouse. If you can understand it and pinpoint it and focus on it you can multiply your results with the same relative effort. Spend more time in your wheelhouse and you will be a lot more productive, profitable and even happy.
I’m sure you have heard the term work smart not hard. Im a firm believer in this and I preach it often. One of the responses I sometimes get is that this is a cop out for lazy people who want to get ahead.
Not the case. Everyone works hard. This is America. You can’t get ahead by working hard alone. Every day you wake up with a decision. Where are you going to spend your two most precious resources – your time and your money. If you can work smart and understand the 20% that is generating the 80% you can make better decisions and multiply your results.
The concept is this – if you can understand it and go from spending 20% of your time in your wheelhouse to spending 100% of your time in your wheelhouse you can produce 5x more.
So later you do another analysis and find that once again 80% of your desired results are coming from 20% of your efforts you can specialize even further. Go deeper into your wheelhouse. Your competitive advantage. Your niche. Another 5x multiple. So a year ago you were producing 1 now you are producing 25. You multiplied by 5 the first time you specialized and now you did it again.
Use this mindset when deciding where to invest your two most precious resources. Time and money.
Work smart. Work in your 20% wheelhouse. Multiply your growth and productivity.
It works in reverse as well. 20% of your customers are causing 80% of your headaches and your stress. Fire them. Avoid them. Tell them, in as polite a way possible, to go elsewhere. Design your service away from them. Design your marketing to avoid them. 20% of your activities in your personal life are producing 80% of your anxiety. Pinpoint it. Avoid it. Step away from it. Get out.
Every year sit down and pinpoint your wheelhouse. Reflect. Study. Learn. Discover. Spend a lot of time doing this. Then adjust. Change the plan. Do things differently. Change the way you invest your time and your money.
Each year you’ll specialize further and achieve 5x the return. You’ll develop your competitive advantage. You’ll nourish the areas of your life that are producing the most benefits.
Do this 5 years in a row and you’re spectacularly good at what you do and living the life you want to be living.
The way people treat their money is one of the most important traits in entrepreneurship.
Frugality wins because every dollar you save personally and invest in the company the right way becomes three dollars a few years later.
Having cash reserves because you live in a responsible way allows the company to survive when the going gets tough or the competition gets fierce. When the next recession hits the businesses with owners who live above their means will have the hardest time weathering the storm.
When looking for a partner make sure they have the same mindset as you do when it comes to money. Similar to a marriage it can lead to tension, arguments, resentment and failure if both partners are not on the same page.
Don’t partner with people who are broke. Broke people have a hard time planning 3-5 years down the road. They have to have short term goals to bring in cash because they are hungry and need that money to pay the mortgage. People who are broke are stressed and thus unable to perform. People who are broke need money from the business earlier than the business might be ready or able to provide.
An important distinction here – I’m not talking about a person from a poor or middle class family when I say broke. This is not about rich vs poor. This is not a socioeconomic status thing. Some “rich” people are horrible spenders and have never been taught the value of a dollar. I call those people broke. Avoid them.
The college friend who needs to call mom on friday night to pitch in for a case of beer. The grown adult with credit card debt and a shopping habit. Avoid these people. There is no excuse to ever be broke. If they can’t manage their own money you will never be happy with their ability to manage your money.
Successful entrepreneurs don’t have goals that are based around the things they will purchase when they make money. The flashy car. The boat. The vacations.
Successful entrepreneurs enjoy the ride and the process of building something. That is where they get their joy. Not by spending the cash that comes after success.
I have a job that pays me well but I hate it. I think there is a real demand for rentable moving boxes in my town. If I can capture just 1% of the people who move every year in my city I’d be profitable. Should I quit my job to pursue this startup?
I would think hard before entering this space. Cardboard boxes are a cheap commodity. The market for them has exploded with the increase in online retail. There are a lot of packaging companies out there competing to do it extremely cheap. You’re trying to replace a cheap commodity and turn a profit + you are adding logistics to this scenario (eg. trucks, manpower, pickup, delivery, appointments). Not to mention a plastic box takes up 10x the space of a folded down cardboard box.
Some companies are doing this but you are largely going to be educating the market that your service even exists. Do not get wrapped up in overall move data to come to your market potential because 95% of people who move aren’t even going to consider renting moving boxes when it is only an $80 expense on a multi thousand dollar expense in the first place.
I do hate to discourage you. It can work and it might very well be worth a shot.
My advice to you would be to find a niche within the market. Do not compete on price. You can’t get cheaper than cardboard boxes and you don’t want to try to be. Find people who are wealthy and are into sustainability. Your service won’t be the cheapest or the easiest option so you need to find people who want to use it for other reasons.
The beautiful thing about entrepreneurship in certain areas is that you can start out as a freelancer on the side and test the market, learn, shift gears if necessary and not take a lot of risk.
I would hammer out nights, weekends and start to get a feel for the market. Start to sell. Start to get money coming in as a freelancer. The entire time you are doing this analyze the market – make sure it is a growing sector. Make sure you can add value by either making the product or service better, faster or cheaper. Ideally 2 or all 3 of those.
Do not quit your job right now.
Then when you are confident that this new gig could replace your job its time to quit with the goal of replacing your income as fast as possible. This entire time you can be investing in your website, your brand and your momentum will begin to pick up.
I started my company while a full time college student and athlete. My company is also in the moving space. You can do it on the side if you are willing to make the sacrifice and really get after it.
20% of my business out the door. I’m scrambling. I’m stressed. What do I do?
You may be expecting a lot of motivation here. A lot of encouraging words. Keep going. Keep trying. Stay determined and you can do it.
Be weary of this advice.
As a manager – you’ll try to work your way out of any problem. You care so much. A lot of entrepreneurs, when the shit hits the fan, just put their heads down and work and avoid looking in the mirror and accepting if something could be wrong with the big picture. They avoid nurturing their competitive advantages. They blindly throw more money at marketing to try to outspend the problem. They are unable to diagnose the problems and fix them early.
I’m not saying there is a problem. Its the natural growth cycle of most businesses. You lose customers and you gain customers.
But if there are signs out there don’t spend so much time putting out fires that you miss them.
Make sure you are still spending time on the areas of your business that are important but not urgent. Big picture analysis. Employee role changes. Operational methods. Market analysis. Advances in tech that your competitors may have. Overall health of the market you are competing in. Etc.
Don’t forget the most important step – the exit interview and a competitor analysis.
Why did they leave you? If you have a decent relationship they would return your call and give you details on what they found elsewhere. This is one of those times an email may be more likely to get an honest answer from them because there is less confrontation. The goal here is to figure out what is the competition doing differently?
Tell them you understand. Tell them it would be invaluable to you to know about everything that went into their decision. Don’t get offended. Thank them.
There are four reason they could have left you:
Do everything you can to find out which one happened and study the company they moved to. Get their prices. Figure out how they tick.
Ask yourself it is worth specializing and getting better or faster or spending more marketing dollars getting more businesses to come in to replace the losses?
Is your industry mature or is the market growing? It could be in a race to the bottom and the service you are providing is getting more widely available and naturally getting cheaper. You are in for a tough ride if this is the case.
My advice is usually to specialize further. Continue to look for, find, and develop a niche that gets you there better and faster so you don’t have to compete on price. Competing on price is how businesses die. It is usually what kills the 5-10 year old semi-successful business.
The ups and downs of entrepreneurship are what makes the good times so good. Stay positive and work smart!
There are only three levels of wealth in this world and beyond that money doesn’t matter. The first is being able to feed your family, pay your mortgage and not stress about going into debt. The second is going to a restaurant and not worrying about what restaurant it is or the prices prices and just ordering exactly what you want. The third is not worrying about the cost of trips or flights but just going and doing what you want to do. Beyond that it really just doesn’t matter. How much money do you need? I bet it isn’t 100 million dollars.
On this blog I’ll tell you how everyday people have slowly built businesses that make hundreds of thousands or even millions of dollars in profit. I’ll tell you how those same people designed the life they want and escaped the rat race that so many of us are stuck in. They can go where where they want and when they want. They don’t work in a corner office for 80 hours a week and commute an hour each way to get there. They make money while they sleep. If they spend a lot of their time working its because they want to work – not because they have no choice.