Learning about dealing with People and Business

Life is a constant classroom.

Along the way you pick up things that can majorly change your life and the way you deal with people and business. Most of the time it gets forgotten and your ego takes a hold and drives you the way it wants to, forgetting a lot of the lessons learned along the way.

This is especially true when in start-up mode. The ups and downs take you on such a ride that it is impossible not to fall back to your instinct and ego. When your ego takes over it is truly your personality that runs everything. If you have an abraisive personality, but have learned how to control it over the years, it will come out in full force while you are playing fight or flight trying to accomplish the things you set out to do.

There are three things that I would care to remind myself, so my personality or ego can never fully take over.

1) People are motivated by your energy and drive to do things. If you worry less about telling people to do things and lead with calculated example, pretty soon others will follow suit.

2) Constant improvement is instant worth. If you are the best at something, people will follow.

3) Only rely on people when they volunteer their resources and are ready and willing to do so. Trying to motivate someone who is unmotivated is completely worthless and will end up using more energy than if you did the task completely by yourself.

I realize this post is a little more abstract, but it is something I wish I could remind myself everyday.

Why unemployment is where it is, is college to blame?

Michael Ellsberg recently posted a piece in the new york times claiming first that if you dropout of college you have a better chance to be a billionaire, second that start-ups employ the most people in the united states.

The article more implied the two statements, though I think his point was much simpler, college isnt for everyone, and reform is necessary. But he fails to back up his statements none-the-less, or even expand more on the idea.

Dont get me wrong, I think Ellsberg is fantastic, and some of his ideas about business and marketing are great, but in this case he gets it wrong.

His statement that “college is not necessary” should be “paying a lot for a good college is not necessary”. Steve jobs audited classes, essentially going to college for free, he learned typography there which helped him build the Apple I. You can learn how to program in community colleges where the cost for a class is as low as $30. Getting educated in a field is extremely important, you need to bring value to the table in order to create a start-up in the first place. There are a huge abundance of wannabe entrepreneurs out there that can only bring sales and marketing to the table, they are a dime a dozen, in fact, I personally know 4 of them.

With the availability of information on the internet, people can become an expert on pretty much anything, but for a lot of people, getting that initial exposure such that a college class can give, is enough to cascade the learning process.

Don’t get me wrong, I think colleges current curriculum is absolutely worthless. They require you to take classes that have nothing to do with what you’re passions are. I think for someone who wants to be a programmer, they should go to college and only learn stuff that has to do with programming. High school should be the time that people are able to try out tons of options and encourage creative growth (which it isn’t doing now). This should be dedicated to a whole post though.

The next part of his article that I disagree with is his thought that start-ups are the main source of jobs in america. Let me be perfectly blunt here: start-ups are the main source of jobs for at lowest High-school educated white people.

You dont see uneducated minorities riding the wave of a start-up. They are typically looking for work in other areas. The current unemployment rate for uneducated minorities is 10%, the unemployment rate for white educated individuals is only 2%!!! I’m not saying that uneducated minorities can’t create a start-up, I’m just saying that they are lacking the tools to better their chance to create and/or work for a start-up. Tools being bringing something to the table, being an expert programmer, being an expert welder, being an expert machinist, being an expert at CNC machines, the list goes on and on. Sales people are a dime a dozen, you could hire a really good salesperson for $35k + commissions, but most likely you are going to hire some of your close friends, who you know wont spend their days slacking off (I was a salesperson so I know).

This begs a deeper question, what does it take to encourage those individuals who find themselves in that unemployed category. My solution is simple, become an expert in something. Find someone who is successful at doing something, anything, work for them for free (sometimes while earning unemployment), learn everything there is to know about their business, and then start your own, or work for someone who can pay you for that expertise.

Active-Passive Income?

I used to read a blog called Smart Passive Income A LOT a few years ago. It was amazing to me that this guy Pat could pull in $15k a month and probably sit on his ass (if he wanted to). I got inspired, and I came up with some ideas myself. Needless to say this didnt really work out.

What I was missing is that it wasn’t truly passive income. It was never a situation where he would have some trust fund and then did no work to receive big payouts for that investment. What he actually did was worked really, really hard by writing a review book for LEED and took advantage of the huge influx of people looking to pass the exam. From this point he was able to truly start out on his own. He quit his job and made it a full time job reporting on his passive income endeavors, all the while starting up more ideas. This to me is not passive income in the sense of the example of sitting back and collecting on a trust fund. Actually, It is working really hard on a project and then sitting back and collecting on that hard work – Active-Passive Income.

Currently, it seems like the LEED thing slowed down considerably, but now he makes a TON of money on his blog using Adsense and Affiliate advertising. I am extremely happy for him and a little jealous (obviously).

What I finally realized is that Pat really didnt make his money from “passive” income ideas, he made it because of his passions for LEED and sharing with the world his desire to be financially independant, and have the freedom to follow his passions. Without those passions he may have never put in the time to write the LEED E-book, or write about it on his blog. Pat is the epitome of what people want, people are sick and tired of working 9-5 for corporations, and he was able to capture their passions and make it a possibility, genius in my eyes.

I might go as far a calling Pat’s ideas truly active income, but I would hate to attempt to compare it to the typical 9-5 that everyone is used to. It is obviously much different than a 9-5 because he truly has the freedom to do what he wants.

If I have one goal with this blog, it is to inspire at least one person to be financially independent, follow their passions, and to donate $500 to me (that last one was a joke). Seriously though, inspiring someone to follow a path where they would do what they love and sit back and watch all the hard work they did pay off? Sounds like a great plan to me.

Supplements – My Best Explanation for why I didn’t move ahead on this start-up

In this post, I will attempt to explain why I never moved ahead after massive amounts of planning and preparation making a supplement for endurance. AKA my “EnduraBoost Fiasco”.

If you didnt read part 1 of my update, I started working on an endurance supplement in 2008 that would boost endurance temporarily in athletic individuals. It actually had some promising clinical trials of its ingredients, and I believed in it.

I created a website, business cards, a formula, labels, pretty much everything you would need to start it up. Everything except a product.

The dilemma I faced was that when you outsource a supplement to a contract manufacturer, you have to buy a large amount of that supplement. Including encapsulating, bottling, labeling, packaging, I was looking at around $10,000 for a minimum run. As a side note, contract supplement providers will tell you that they can do “small runs”, but the cost per bottle is typically so high, it really makes no sense. Also, because I was so honest, I didnt want to use crappy ingredient substitutes and screw over my customer.

So here I was, with $2000 in my bank account and a $10,000 (minimum) start up cost. My breakeven by doing this would be to sell about 500 bottles. This worried me, so I tried other options first, options which ended up dragging on and on until eventually burned me out and I ended up shutting it all down.

The first option I tried was to presell the product. Not my smartest moment. I would call and email retailers and tell them about the product, show them all of the nice stuff I made for it like labels, and websites, and hope that they would either buy the product at wholesale or even consign the product. I pretty much got no response.

I used the technique in Tim Ferriss’s book “The Four Hour Workweek” by setting up a website and adwords account and trying to “test sell” the product to see if anyone was interested in buying it, no luck there. I later learned that this technique was pretty much made obsolete by the fact that modern Google Adwords is pretty much impossible to use efficiently for the average Joe, and I even spent months researching adwords (I will write a post on this explaining more).

I had considered that this was a product that may not have demand, but I looked a sales numbers of similar products, most of which didn’t have the clinical trials to back it up like mine did, and there was definitely a niche market.

I realized then that I probably couldnt sell the product without the product itself, and local stores/events/promotion is that way to go, so I looked into manufacturing it myself. This was the nail in the coffin. I spent years researching how to buy the ingredients, buy the bottles, buy the printable labels, good ways to encapsulate, good ways to seal the bottles, then package them. It was absolutely rediculous.

I spent $300 on basic equipment and ingredients, and got to the point where I could make 20 bottles of the stuff, including labeling and packaging it. I was so burned out at that point that I never followed through. I’m not really sure why. Maybe because the finished product was not that nice, and I was embarrassed to try and sell it. Maybe because I wasnt interested in spending 1 hour per bottle manufacturing them until I had enough money and customers to pay for the large-run manufacturing. Maybe because I felt I could never really sell them. At this time, I realized how rediculously competitive the supplement industry was. There were web sites like Swansons, and companies like Now, who dominated the industry.

Something that I would probably like to ignore is that I think a fear of failure played a role in me quitting as well.

Looking at it now, I would have probably embraced my passion for health and supplements, saved up the money and paid to have the supplements made. It would have lit a fire under me, and forced me to go to marathons, walk into MMA facilities, give away free product for promotion. All of these things may, or may not have worked, but at least I would have went all in.

This is why I think capital is important in start-ups, it gives you that edge necessary to jump start it all, bypass the riff-raff, and get to networking and selling, the most important parts of getting your product or service off the ground.

Update on where I am at, and the steps it took to get me here. Part 1

In this update, I will discuss where I am at right now. I have a feeling there are many other people out there in the same situation that I am. This blog will hopefully one day be a resource for other people as well as a way for me to communicate and learn from others just as they will learn from me (and my mistakes).

I graduated college about 9 years ago. I joined the rat race.

I Took 5 different sales jobs over the course of 6 years. All of which were horrible. I was always average at sales, never really had it in me to be passionate about the products that I sold. The reason for this is that they were all commodities, you could get the exact same product or service somewhere else.

I was nearly fired from 2 of those jobs, and got laid off from my “final” sales job in 2006. It was at that time that I realized I was going nowhere.. fast. I sat around a moped for a year, living off unemployment and credit cards. I had some entrepreneurial spirit in me, and pretty soon I was at least trying to figure something out that I could do on my own.

I tried looking into starting an online music store, but soon realized that there was immense competition, and I would bring an utter lack of originality to the table. Then I tried looking into supplements (which I always had an interest in). I came up with a supplement called Enduraboost. It was going to be for runners who were looking for a natural way to boost their endurance. I got so excited about it, I wanted to be that awesome guy that everyone looked at because I started my own company! Mistake number one…

I joke you not, I spent 2 years working on this project and NEVER actually made the product. I created this vast infrastructure, including a website (I created myself) with a payment system, marketing materials, business cards. I even called some local supplement stores to try and “pre-sell” them on the product. During those two years, I learned a lot about adwords, and how difficult it can be for an average person to benefit from it (more on this later).

Not one time during any of this did I actually spend the money and make the supplement, then go out and market the crap out of it. After failing to get any sales (even though I never had the product to begin with), I shut down the website (that was getting a whopping 2 visitors a month).

After that mess of failing, I realized that if I was passionate about what I was doing and not about the end result of “being awesome because I ran a successful supplement company”, I might have actually done something with it. I might have gone to marathons, and MMA training facilities, etc. Hung out, made contacts, loved my product and the process of watching people benefit from it. I still havent figured out why I didnt do this, maybe fear of failure, maybe because supplements was never something I was that passionate about… one day I may get some clarity on this.

During this whole time, as a back up, I was also manufacturing jewelry.. yes jewelry. I had come up with an idea of having a manly ring, one inlaid with concrete. So during my spare time I worked on prototypes, found someone to manufacture the metal portion of it, and made probably 200 rings in my garage.

Needless to say this never worked out. I was actually making about $300 a month selling them, but I never got the concrete formula 100% right, and they would occasionally crack, and I realized that if I ever wanted to go big, I would need to manufacture them on a much bigger scale. I was also never really excited telling people about what I did, I ended up losing my drive, and shut that business down as well…

You’re probably thinking now, wow, this guy has had a lot of failures! and your right, that wasn’t even all of them! I had about 3 other businesses that I worked on from the time I graduated college (more on those too). Importantly, I did learn from those failed businesses, now I have a pretty good knowledge of PHP, HTML, Payment gateways, MySQL, of which I knew nothing about before.

Since that time, I decided that making $300 a month + unemployment income was not the way that I wanted to go through my 30′s (I was 29 at the time). I spent a lot of time reflecting and deciding what I really truly wanted to do in life, and what path it would take to get there. I had many different paths on a list, of which, I narrowed down to becoming a CPA or a becoming a Teacher (professor). You may be thinking right now that those are pretty much the opposite of being an entrepreneur, but after 2 years of living off beans and rice, I was ready to make some real money while I tried to start a business, whatever that business was. What I really wanted was a career with the flexibility to start a business.

I chose to go the CPA route, it was the closest thing to starting a business since I could run my own firm. It would also allow me to have some free time to start whatever it was that I wanted to create. Most important though, it would give me some flexibility with money to be able to invest capital when it needed to be invested.

Continued in Part 2 – The steps I took and am taking to start a tax firm, and the path I am taking to do what I really want to do in life.

Edit 1 – 10/7/11 – Edited some Grammar (attempted), spelling

Weekly Summary with Current and Long Term Goals

Current Situation and Income:

I will be going through and breaking down each business and project saying my current income from each as well as what is currently happening on the sidelines.

Note: I will be making much more quantifiable goals next week, I just want to give you an idea of what’s going on with each of them.

My Supplement Life: A website that hosts about 15 products aimed toward a niche market of athletes. The site is designed to allow reviews, blog posts, and even an attached forum (currently inoperable). Many of the products are affiliate based and really provide little profit. The main disadvantage of the site is the lack of margins.

Near term goal:

• Find some affiliate products high in quality that can net more profit

Long term goal:

• Create a niche site where athletes can go to in order to purchase quality supplements that have been reviewed by others and scientifically backed.

Last month’s revenue: $1,236

Concrete Rings: Currently I have old pictures up, the content hasn’t been optimized, I cant stand doing the manual labor, but the concept is awesome. I have also been having problems with durability, though it seems to be stronger than the typical Gold ring.

Near term goal:

• Decide where to go with the Labor. Outsource?
• Redo the website with new updated pictures.
• Find a stronger sealer.

Long term goal:

• Full automation
• internet advertised
• high margin
• Durability that will last for over 5 years.

Last month’s revenue: $240

Enduraboost: I have the formula, multiple websites (for different search terms), and good content. It costs about $4000 per run to manufacture these bad-boys, so needless to say I am waiting to see demand before I do this. Currently I am researching good ways to test demand without the high costs.

Near term goal:

• Flesh out SEO sites and get them traffic
• Test product
• Add content to sites

Long term goal:

• Automate and sell from multiple sites, using multiple niches for endurance and energy.
• Make wholesale and affiliate program and syndicate sales

Last month’s revenue: $0

Banking: This is a tough one to describe and make goals for yet, but you will hear much more about it later. We are completing a merger soon (hopefully).

Get on our Level: This one is a great concept, I am excited to work with a team, next week I will shed much more light on this one.

Video-Fightsite: This project will be fun, I don’t expect huge profits from this, but it could turn into a fun niche site for people who are looking specifically for certain fight videos.

Near term goals:

• Upload videos
• SEO – backlinks, matching search terms to titles
• Create weekly news content

Long term goals:

• Automated Ads
• Constant growth
• Niche down

Work Accountability

Work Accountability – The new mlguenther.com

I will be doing something much different with this blog than I had originally set out to do. Rather than provide advice and thoughts on entrepreneurship and business, I will be creating accountability for myself, and allowing any readers to learn from me and my mistakes.

I will be posting a weekly report of the statuses of the businesses and projects that I am working on, hopefully along with small pieces of advice and articles so that other business owners and budding entrepreneurs will not make the same mistakes that I make and have made. I also hope to inspire others and provide the insight that I would have loved to have when I first started.

My goal with all of my businesses and projects is to create a completely automated, passive source of income. I was inspired by a few people, most notably Tim Ferriss and Pat from Smart Passive Income.

Here is a current list of the businesses I am running:

My Supplement Life – A website that offers a small range of supplements for a niche health market, originally designed to be a community where people could discuss herbal supplements and get new news and information relating to this.

Concrete Rings – The first business I ever started. I designed and manufactured a ring that has an inlay of concrete. The website is still up and I still sell rings, but I have not done anything on it in months. Hopefully this can change. I really liked the concept minus some of the manual labor, such as the polishing and mailing of the rings.

Enduraboost – Enduraboost is a supplement that I plan on tying into the My Supplement Life website. It is a unique supplement specifically designed to increase endurance in athletes. This is a true passion of mine and it holds a lot of value in my mind to succeed at this, but it is one of the most difficult and expensive businesses to do, causing me to move really slow on this one.

Banking – This is a really cool opportunity that I was given. It is basically a commission based loan officer, but customers are provided to me. It is a fantastic bread and butter job that just kind of fell in my lap. I hope that it turns out to be as good for me as it is for some of the guys in the office.

Here is a current list of projects:

Get on our level – This is a project that I am really excited, but skeptical about. I teamed up with an SEO savant and a couple other really smart guys who are planning on creating websites based on search engine keyword interest. As visitors go to the site for the content they are specifically searching for, advertisements and affiliate programs will be offered and revenue generated from that. I am excited because it is a great concept and the people I am working with are absolute geniuses, but I am skeptical because I have never personally seen this sort of thing work before. I will be helping with content and wordpress maintenance.

Video-fight site – This is a website based on a popular search term that is very underutilized. I decided to create a niche website with a bunch of great videos of fights, anywhere from school fights, to girl fights, even professional mma fights. It will essentially be a youtube for a niche audience. We will be incorporating news and blogs that will create additional content. Making people want to return to the site for more, essentially creating a community, I am working with my good friend Nick on this.

My next post will be my current earnings and specific goals for each one. I will try and break the goals down in a near term and long term format. Then I will state my goals to be completed by the next weeks post.

Every week I will also try and post some of the articles that I read that help me out.

Opportunities are everywhere, but are they for you?

Successful entrepreneurs like to tell you “opportunities are everywhere” and if you keep your eye out you might be able to spot one and make millions. What they fail to mention is the prerequisites required to embrace that opportunity and to create a truly successful business.

For example: If you walk around coming up with great business  ideas about anything and everything, the chances are that you will not make much money off of any of those ideas.

You need to have two things in order to take advantage of a good idea: 1. An interest in the idea and the industry and 2. a base knowledge in the area  (i.e. manufacturing, landscaping, ). Interest and knowledge in the idea will drive the hard work.

Then there comes the marketing and sales which is not necessarily a prerequisite, but is very important.

It takes all of these things to really push a good idea to fruition. It takes work and dedication to learn everything there is to know, to try everything to make the best product, to learn about sales and marketing to present your product to customers.

So the next time an entrepreneur tells you “there are ideas everywhere, you should be able to start a business no problem” remember that there is much more involved. All of these things can be acheived with dedication and hard work, but it isnt as easy as 1,2,3…

The Enconomy Sucks (you all knew that!)

A good friend just got “laid off” today. Well, more like the company forced him out.

Very similar to what happened to me two years ago.

For me, it was a good thing, it made me realize what I really wanted in life. For him, I am hoping the same thing will happen. Unfortunately he has a wife and two kids to feed, so it may not be as easy for him.

These events provoke my constant evaluation of where I am in life and what makes me really happy.

There will always be roadblocks and you will always have to do things you dont want to do. Whether you work for a company or if you work for yourself. Personally,  I hate walking in to businesses to sell my rings, but I do it because I know that the result will truly make me happy: More people will enjoy my rings and I will be more financially sound.

If you are happy even though you have to do those things, that is the best thing you can do for yourself, your family and your friends.

Search Engine Optimization for Small Business pt. 2

In part 1 we looked at the importance of SEO, in part 2 we will be looking at the basic components:

SEO consists of a few basic concepts to help drive customers to your site:

1. Content – This I believe is the most important aspect of SEO. If you do not have content that is relevant, why would Google or your users “care”. Your content must be relevant and interesting, and it must be continually updated and added to.

2. Is everything on your site easy to get to? – do you have to click three links to get to your “how to” page? or one just one click? Google likes to have easy access to all of your pages.

3. Is your code simple and correct? – W3c checker, is your server fast, is your code so complicated that

4. Does your sites titles and descriptions pinpoint your product or service? – Most people just put the name of their company as the “Meta Title” unless your hoping random people search for your company name, you should change it to what you are selling, not who you are.

5. Learn how to use Google Webmaster and Site Explorer. They will tell you loads of information about your site, rankings, broken links and keywords that the search engines are using. This will tell you what direction you need to go in.

In the next installment I will go into more detail on SEO and how it effects your small business. Join the RSS to keep up to date