The Lazy Entrepreneur Podcast

Sam Priestley dives into modern day lifestyle entrepreneurship. What is working, what isn’t, and how exactly do you build a business that funds the life you want to live?

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“Whenever there is a hard job to be done I assign it to a lazy man; he is sure to find an easy way of doing it.” – Walter Chrysler

Most Recent Podcast Episodes

All of the following episodes can be listened to in any order. So find a subject you’re interested in and start there!

#42: How To Start A Supper Club From Your Home

“A supper club is what I describe as an experience-based business that you can run from your home or in your local town. There are an almost infinite number of different types of experience businesses that you could run”
– Sam, on the abundance of experience-based business opportunity

It is really easy to start a business from your home. In this episode we delve into Emma’s home business.

Resources Mentioned In This Episode Of The Lazy Entrepreneur Podcast:

Listen to this episode of The Lazy Entrepreneur Podcast on:

iTunes | Spotify | YouTube | Stitcher

Structure

00:25 – What is a supper club?
01:00 – Easing customer’s nerves
02:31 – Building towards a restaurant
03:41 – Sam’s thoughts on businesses you can start from your bedroom
05:05 – The legitimacy of supper clubs
07:00 – Why was Emma nervous about starting a supper club
07:35 – Discussing imposter syndrome
08:16 – What qualifications do you have to make gin?
09:11 – Emma meeting a cocktail blogger
11:24 – Low barriers to entry in many different fields
12:14 – Different reasons people go to supper clubs
13:52 – Would Emma recommend starting a supper club?
15:35 – Emma’s shout out

Transcript

SAM: Hello and welcome back to another episode of The Lazy Entrepreneur, I’m your host Sam Priestly and today we’re going to be talking with my lovely wife, Emma, about her home business Emma’s Nomad Kitchen which is a supper club which she runs from our home. What is a supper club, a supper club is a dinner party where people pay to come so it’s like having a restaurant from your home. So every couple of weeks you will invite eight strangers or you’ll sell tickets to eight strangers who will then have a three course meal plus canapes and a welcome drink and tea and coffee and stuff like that. So paint a picture for us, what is it like going to one of your supper clubs?

EMMA: Yeah so yeah typically you won’t know who’s going and you definitely won’t know what the menu is, and I think people tend to be quite nervous as they come in the door so I always welcome them with a drink and canape and we always sit upstairs in the living room which has got a giant sofa which is quite comfortable. I like to think people can get to know each other and then we come downstairs and sit down at the dining table and then I start with a starter and finish with truffles and tea and coffee. People expect a social, so they expect to meet new people, they expect to try different food and have a good time. It’s fun.

SAM: And people don’t normally expect you to eat with them.

EMMA: No. No, which I do because part of it for me is as I said getting that instant feedback, that gratification but also meeting new people. Finding people to go for coffee with, go for brunch with on the weekends, whatever.

SAM: Yeah, and it is a business, it’s something that makes you money. You have about a 50% margin so you make about 150 pounds a go and you do it every couple of weeks, so it’s not a big business but there is a little one and it has all the makings of something that could then grow or change or adapt into something else.

EMMA: Yeah and it’s a good platform to test ideas.

SAM: Exactly yeah.

EMMA: Whether that’s verbally or on the plate or a drink or whatever.

SAM: Yes so if you wanted to start a restaurant, this is a nice way to start, rather than going the full stretch and opening one, you can start by having it in your home with just eight guests. Then you can start hosting it in other venues outside your home, or you can have more guests. You can certainly build it up, you can do from once a fortnight, once a week, and then eventually once you know it’s going to work out, you can then move to that step of getting a big loan and and finding a location and turning it into a proper restaurant.

EMMA: Yeah and also you can use it as a bit of a consumer research, so you could use it to launch a product, so for example, our gin. We could have used supper clubs initially to test out different versions of our flavour and get an idea of customer feedback, do they like the product, do they like the branding.

SAM: Yeah, or if you were serving a source that people liked.

EMMA: Yeah exactly.

SAM: Start bottling that and selling it. And that’s something if you did decide to start doing that, it’s something you could then do from your own home, so you could start making a sauce yourself, putting it in pots and then selling it. You can then find a factory who could then take your recipe and make it in mass and build it up all slowly, kind of bootstrapping it. I think I can sometimes be a bit rude about businesses that you start from your bedroom. Especially when you’re doing a lot of the work yourself, because there’s not much scalability there.

EMMA: Yeah.

SAM: So let’s say you’ve got a t-shirt business, what you do is design some t-shirts and you screen print it and you put it on and then get an order and you go down the post box and you post it. But I’ve only read about those because people don’t often think ahead at the beginning and they put themselves into a corner where they can’t afford to not do what’ll work themselves.

EMMA: Yes they can’t scale up easily.

SAM: They can’t scale up. Whereas if in fact it was the other way around and they were just testing something else, but then with the pricing that you have in your mind, this could turn into something better, I’m a really big fan of it. And actually, the reason I want to talk about this is not because I want people to start supper club but because doing these sort of businesses from your home is probably much, much easier than what most people think.

EMMA: Oh yeah.

SAM: I think a supper club is a good one because it is serving food and so I think people think there’s loads of laws around it, like you need to have a certain type of kitchen, you need to be in an industrial place.

EMMA: And loads of people ask as well.

SAM: Most people ask and I think this idea that it’s a little bit illegal and people come.

EMMA: They think oh this is right?

SAM: This is a bootleg restaurant. Well actually that’s not the case, like you have, you know your five-star food hygiene rating. You’ve been inspected by the council, didn’t cost you anything. You just sign up online, you have to do like a one-day course.

EMMA: Which I could have done online but I chose to do it at a council building so I can meet people.

SAM: Yeah! We’ve got a blog post on exactly how you know all the legal steps you need which you can read on in the show notes or on sampriestley.com.

EMMA: And that is pretty much it it’s not much more.

SAM: It’s really straightforward. It gets more complicated if you’re selling alcohol, but apart from that it is quite straightforward.

EMMA: And that’s what you need that’s all you need for that.

SAM: There we go I’ve got it written down here. You must register your supper club with the local council. You should leave at least have 28 days before starting. Once registered, you’ll be inspected by the Food Standards Agency, and then by law you also need that anyone handling food for the supper club must be adequately trained.

EMA: Yeah.

SAM: And that can mean a bunch of things, but generally you can go into a food hygiene course so Emma did a level two course. You can take the course online and do the exam online, and it cost twenty five quid. And that’s it, it costs all the legal requirements at a total cost of 25 pounds to running a food-related business from your home. That’s pretty simple right? You don’t need to create a business, you can do it as self-employed as a sole trader, you don’t even need to declare your earnings unless you’re earning above a certain amount. It’s one of the gig economy things that’s quite easy to get going. Now let’s say we were making sauces, packaging it up and selling them. Yeah there’s probably a few more things you could go do with that, but it’s not going to be that complicated. It’s gonna be you know fairly straightforward and it’s something you can do. So you were quite nervous about doing a supper club werent you?

EMMA: Yeah very nervous.

SAM: Why was what?

EMMA: Because people were paying for my food and I haven’t had any training in terms of, I’m not a professional chef. I’m a home cook so I was really nervous that my food wasn’t good enough and people wouldn’t want to pay because I am putting myself out there.

SAM: Yeah well you heard impostor syndrome, which is the term for thinking you’re a fraud, that you shouldn’t be doing this, that you need to be a professional in order to serve, to have a restaurant .

EMMA: Yeah I suppose really it was I didn’t think I was good enough. I didn’t think I was faking it.

SAM: Well that that’s why I mean by imposter, you don’t think you’re good enough yet to do this. You don’t think you’re a professional. You put everyone else on a pedestal, and people get that in everything. People get it in sport, where even though they’re world champion, they still think they’re not that good and they’ll be called out one day. For instance the gin, when we started the gin business, people said, well what right do you have to make gin?

EMMA: Yeah.

SAM: What qualifications do you have to make gin? We don’t have any qualifications, just a love a gin and a lot of experimentation and research and self learning. Likewise, with your supper club, what qualifications do you have in order to be a chef? You don’t, but you do have passion and research.

EMMA: Lots of practice.

SAM: All that kind of stuff, and the truth is you’re not starting a restaurant, you’re starting a supper club which is a one day every now and again, you don’t have that many guests, you’re not trying to compete with the michelin starred restaurant in central London. It’s a completely different thing.

EMMA: I think it’s really interesting this whole thing of like being a professional and having the qualifications. I met someone recently who’s a is a cocktail blogger so she creates cocktails, she’s got big following on Instagram and we met for a drink and she was explaining what her previous history was and one of the roles she had was, well her kind of main role was a big kind of advertising marketing role in London, and after that she became a life coach and she went from kind of a professional background to something that was a bit more of a softer skill, so she did all these courses and paid loads of money, and she was a life coach and then she said, and then I decided I wanted to focus on drinks and now I’m doing the cocktail blog. I said, “oh so did you do any qualifications in mixology or catering or anything like that?” She said, “no of course not.” I said so what was the difference, so I thought that was really interesting, she didn’t have an answer. I don’t think anyone had ever called her out on that and called her out is a bit of a mean term for it because obviously I don’t think she needs to, she’s great at her job. But I think that whole thing, if you need to have this whole bank of qualifications and rules to be able to do something professionally. As in, get paid for it.

SAM: Yeah and I think it’s that part, they get paid for isn’t it. Well she’s a cocktail blogger and it’s a hobby.

EMMA: Oh no she gets paid quite, she gets sponsored by brands all the time, it is a very good income for her.

SAM: Well now she does but when she started, she was just a hobbyist cocktail blogger. And the proof is in she got popular, we call it the early amateurization of industries. Or the democratization of industries, where a lot of the gatekeepers of these things are disappearing and now anyone can kind of go and do it, and then the ones who survive are the ones who are good rather than the ones with all the qualifications.

EMMA: Which is great, it’s all about how good you are, your new ideas and how creative you are.

SAM: Yeah the downside of it is we get it with all these authors and books and the rise of self-publishing is that there’s no quality check, so it could be that someone who can only cook a ready meal, like if I start the supper club, it’d be terrible, but there’s no one telling me I can’t do it. So I could start a supper club and it would be rubbish and I get loads of bad reviews. The barrier to entry is really low, but that means anyone can do it, so that’s one downside but a plus side is that people who are truly passionate about it like you can end up doing it, and it kind of side steps all the nonsense about, you know what school you went to, whether you’re a man or a woman, what color you are, like it’s all totally down to you.

EMMA: Yeah.

SAM: Which I think is great. Why not just go and do it, why not just try something out. Supper club is a thing but there’s no reason why you can’t do other things from your home. We could do gin tasting, we could do yoga, we could do anything.

EMMA: Brazilian jiu-jitsu.

SAM: Like there’s any huge scope for the type of things we could run. I was thinking like the perfect supper club is a mixture of social interaction, you’re going in it to meet people, the food, it’s good food and also an experience. They are often themed in some way. Something you get that you wouldn’t get elsewhere. Well you can fit some of those things in, take the food out and just experience a social and you can do all sorts of things. Do like dance classes.

EMMA: A tour of Tunbridge Wells, I can do like a a bar crawl that people paid for. Yeah there is…

SAM: And in fact the supper club is one of the harder ones to do because of the food hygiene stuff around it. I think people worry a little bit about their legal liability, what happens if someone gets hurt in my business and I get sued. You can understand why people ask, because especially if you read the news or you plugged a bit into like American culture, and that concept of like sueing people.

EMMA: Yeah and especially at the moment within the food and drink industry about allergens so like for example, what’s happened with Pratt.

SAM: They said it was allergen free and it wasn’t.

EMMA: Yeah and people are voting with their feet, they’re not going to Pratt because of it. I think that particularly in food could really put people off.

SAM: Yeah, you almost don’t want to get into it in case something bad happens. But you know there are insurances you can get for that, and these are really unlikely things to happen anyway. I get that that is a worry but it’s the same worry you have when starting any business. But it’s at a lesser scale because it’s from your home, because it’s small scale. So would you recommend starting a supper club?

EMMA: Yeah absolutely love it I love the creative side of it, so I like picking the menus, I like posting pictures on social media and getting comments, I like the instant feedback, people trying the food and saying they really like it and wanting the recipes which I give them at the end. And I like the social side of it so meeting people I would never normally meet, particularly for us because we both work from home, we don’t have a big pool of people, new people we’re meeting all the time. So it’s great and it’s people from all different ages from like late 20s to 80s. I think it just makes for a really interesting evening and no two are alike. I love the variety of it and not just because I do a different menu every time, but the people, the mix of people were always different. Yeah I love it. Recommend it to anyone.

SAM: Cool, well thank you for that. A supper club is what I describe as an experience-based business that you can run from your home or in your local town. There are an almost infinite number of different types of experience businesses that you could run, a supper club being just one of them and one that we have experience with, and it’s really easy to set up, you could make a bit of money, it’s a good place to trial ideas for businesses you might want them on a scale and grow to something else. It’s a good thing to do if you’re just looking to earn a bit of extra income while at the same time meeting people from the local area or being a bit social. And, yeah the best thing is I think is it’s really easy to set up. Anything else to add?

EMMA: I’d like to do a shout out to my friend Mae who I would love her to set up a supper club. She’s planning to do a Maldivian supper club in London. I’m really trying to encourage her to do her first paid one, we went to a test one a couple of months ago and the food was amazing, so yeah big shout out to her and lots of encouragement!

SAM: Awesome sounds good. Well thanks for listening and if you have any feedback you can reach me at hello@sampriestley.com. And the supper club is called Emma’s Nomad Kitchen you can find it on Facebook. Good-bye!

#41: Who Do You Want To Be?

If you could be anyone in the world, who would you be? I believe that we can change our personality and so in this episode we discuss our role models and who we want future Sam and Emma to be.

Resources Mentioned In This Episode Of The Lazy Entrepreneur Podcast:

Listen to this episode of The Lazy Entrepreneur Podcast on:

iTunes | Spotify | YouTube | Stitcher

Structure

00:52 – The importance of breaking isolation
01:34 – Foundational brand questions
03:52 – What traits would you like to have?
07:29 – How would Emma like to be more like Michelle Obama?
09:57 – Sam’s bar story
11:38 – How Sam and Emma met
14:02 – The 3-second rule
16:15 – Haggling thoughts
19:00 – Behaving in accordance with future you

Transcript

SAM: Hello and welcome back to another episode of lazy entrepreneur I’m your host Sam Priestley and once again we’re joined by my lovely co-host and wife Emma Priestly.

EMMA: Hello.

SAM: So Emma went to the Girls Tribe meetup which is, they have local chapters around of female entrepreneurs or people who want to quit their job and it’s just a chance to meet other people we’ve got similar goals and be networking and then there is also normally a talk about something.

EMMA: Yeah and one of the main things is to break isolation because when you’re freelancing or working for yourself, you don’t tend to have that much of a social life in a network. You’re not in a big office with lots of people, you tend to be working at home on your own so the idea is to meet other people that can go for coffee with you in the day and have lots in common with.

SAM: Yeah and really that’s something we should probably do a whole episode on. The loneliness of entrepreneurship. Yeah so the one you went to last week was the talk was done by a company called See Magic and what they got you to do was quite management consultancy type thing where you look for a bunch of stuff about your brand, you can build your brand vision, link your brand to a celebrity, all this kind of stuff. Like decide what it is you want your brand to be like so here’s a little booklet they made you here. The first one was, in one sentence, what do you do? Write your story. Why do you exist? What are your values? What’s most important to you? Who are your audience? Create a portrait of that person. What’s your tone of voice? And who is the a celebrity persona. So we’ve seen this sort of stuff before when it comes to building a business and deciding what it is your business wants to be like. It got me thinking that we are kind of brands ourselves.

EMMA: Yeah.

SAM: And I believe that who you are as a person can change and you can mold it and so wouldn’t it be interesting to apply some of this sort of stuff to ourselves? Decide who it is we want to be, what is it about ourselves we want to change and then how we change it? How could we be more like that?

EMMA: What big questions.

SAM: Yeah I know. This could go terribly wrong but we could try and do something on there and I answer some of these questions because I’ve got this idea that you can fake it til you make it and that if you act like someone who’s confident, extroverted, you’ll eventually become confident and extroverted. That we’re not stuck in the person we are now. We can learn, we can change ourselves, we can become better, we can become kinder, more empathic. And likewise we could become harsher and more confident and on feeling and better at conflict and all that kind of stuff. Therefore I think it’s quite important to decide you know what traits you want and then and then work towards it. And as a video game fan myself, I quite like this idea because that’s what you do when you’re playing a video game. You build your character up, you put points into intelligence and agility or strength or personality traits.

EMMA: So you’re trying to gamify your life.

SAM: Of course.

EMMA: That’s very you isn’t it.

SAM: So let’s have a go at it. Let’s start with the last one. If you could be anyone in the world, doesn’t need to be a real person, could be an amalgamation of a few other people, who would it be? If you could create yourself, what would you create? Should we start with what traits would you like to have?

EMMA: I think it’s such a hard question. I think it’s easier to answer who you watch right? So coming like quickfire coming to mind are two people. One is probably Michele Obama, because she’s very successful and she’s a real advocate for women and I think she’s got a great story and people really respect her and I think she’s using her platform for good.

SAM: Okay so what is it about her that’s different to you?

EMMA: I think she’s a very polished role model for women around the world.

SAM: She’s very polished isn’t she. She dresses well, speaks well.

EMMA: She’s got that professional. She looks the part whatever she’s doing, whether it’s a suit or whether it’s dressed down, and she always uses kind of speaking opportunities, social media, books, whatever it is to tell her stories and make it personal to empower women and I think she does a very good job of it. So I’m not saying I want to be the president’s wife, ex-presidents wife. I’m saying I really like that professional polish with a good cause.

SAM: Yeah.

EMMA: Not just, I’m on social media and I’m doing business because I want to make money. But I want to help people.

SAM: So there’s something about the good cause that you like.

EMMA: And having having morals, and having a clear message and sticking to it.

SAM: Yeah, yeah.

EMMA: I couldn’t tell you exactly what that was for me. But I really admire that about her.

SAM: So it’s some sort of like strength of character there. When I think of Michelle Obama, I think someone who’s quite strong, unwavering. You imagine she does well in interviews. She doesn’t doesn’t fall into the trap of peer pressure and being trying to just be matey with whoever she’s talking to. She’s very confident in herself.

EMMA: I also feel she’d be amazing it like negotiating and conflict. I feel like, I don’t know that.

SAM: It almost doesn’t matter what she’s really like. It’s more like what your image of her is. So what do you think about her would make her good at conflict.

EMMA: From the things you’ve just said, I think she’s confident and strong and firm.

SAM: So when have you been in a situation where you feel like Michelle Obama would have done better than you? Do you know I mean?

EMMA: Yeah.

SAM: It’s almost like you know those wristbands WWJD. So often Christians wear wristbands, what would Jesus do? And it’s just like a reminder that in the situation, what would this role model do?

EMMA: Yeah.

SAM: If they were here. And I think that’s quite a helpful way of thinking about this. It’s like, in each situation what would this person that I wanted to become more like would do in that situation.

EMMA: I suppose for me, I’ve been very lucky with a lot of opportunities in my life. Looking back, decisions I made for which jobs to go for, and what jobs I got and starting business with you and doing supper clubs, I don’t look back and think well I made these mistakes, I wish I’d done things differently. So it’s quite hard to answer.

SAM: Yeah, you’re probably a little bit less self-critical than I am.

EMMA: Yeah I think maybe the question is, how would I like to be more like her.

SAM: Yeah.

EMMA: So in the future, would I like to do speaking things, would I like to do mentoring. Like it’s more there.

SAM: Yes so you’re coming at the angle of stuff to to achieve in your life. Like stuff you can do rather than personality traits. Which is good as well because it’s giving yourself a role model of what can be achieved and so you know that if you’re if you have been a bit lazy or whatever that you could be doing more.

EMMA: How about you?

SAM: Yeah, well I think loads. I’m not sure I can think of any one person, but I have a few kind of people in my mind. I’m not thinking of celebrities, so they’re more people I’ve met who I like certain combinations of their traits. And often it’s a bit of the grass is greener. It’s looking at the weaknesses in myself that I wish were stronger and then when I see their strengths in other people.

EMMA: You really appreciate it.

SAM: Yeah so let me talk about a couple of like moments that jumped out at me and I thought I wish I was like that. So one of them. When we were starting The Wren Coffee Shop, we were going to look around a venue which was this old church which was being refurbished. We were walking past the person I was with and he says why don’t we just go inside and have a look? And I was like, oh well the landlord isn’t here yet. And it’s just like all the builders in there, I thought there’s no way you just walk onto a building site. He was like, no let’s just go in and so we went in and they showed us around and like that, there’s something about that gumption, that confidence and gumption that I really liked and I know kind of from a logical point of view that is, you know, what’s the worst that could happen if you try and go in there and someone says no. Nothing really. So that kind of confidence to just do something a bit weird and a bit different I really like.

EMMA: Yeah and out of your comfort zone.

SAM: And out of my comfort zone. There’s another one, a similar sort of thing when I was about 20, we went to a restaurant like a bar and there were just no seats available. So the person I was with picked the best group of good-looking women and went over said, “Oh can we come join you?” and I was blown away by that. I was like he’s taking this bad situation where there’s no tables left as a way to to make the most of it.

EMMA: Yeah.

SAM: He’s got a great excuse to go and share a table with them. There’s something about that that really struck me. Like isn’t that awesome? Isn’t that a great trait to have.

EMMA: That would never have even crossed your mind.

SAM: I would have just stood up, I might have decided to go and ask. I probably would have picked the most friendly, the ones who are least likely to say no, as opposed to the people I would most want to sit next to. There’s something about that fear of rejection even though it’s so petty that I don’t like in myself that I would like to emulate. So that guy and that situation which happened ten years ago I did actually for a long time often try and emulate that sort of thing so I would purposely go over and make sure to, in situations where I thought this is a perfect time for that.

EMMA: Yeah.

SAM: And I’ll have a few like mine tricks, that kind of thing. So in a nightclub, I’d look around and see who I wanted to speak to most, then I give myself three seconds to go speak to them and then I just go do it. So a bunch of stuff like that were just so against my kind of introverted and a bit shy personality. I just force myself to do it.

EMMA: Well that’s how we met you came up to me.

SAM: Yeah we didn’t know each other and no one introduced us or anything I just came over and said hello.

EMMA: And the girl that I was with was super. And I was pretty chatty.

SAM: And that kind of personality worked out. I was with a group of friends and you were with a group of friends and for a long time this is what I’d do is we go to something where it’s a group of friends and I would leave them and go off and you can chat to strangers and leave them in their clique talking to each other. It was something that comes quite naturally to you, you’re quite happy to go over and chat to strangers but it’s something I find really difficult.

EMMA: Well it’s interesting in the hostel setting because actually when we were first traveling in South America, I was really not settled, I was all over the place emotionally and actually found it really hard to go up to strangers in the hostel. I’d much rather stay like with you and have a drink can just chill and actually you were the one that was like no you need to go and speak to these people. It’ll make you feel much better and it always did.

SAM: Yeah, and now we’re almost the opposite situation so I was forcing myself into that situation and now when we go to like a networking event or something like that, I’m always one happy in the back and you’re the one going over and chatting to the strangers. And I’m like okay I want to meet so and so and then go introduce myself.

EMMA: You did really well, we went to a wine like retail store opening a couple of weeks ago. That was about 30 people and we spent most of the night apart, you chatting to people you didn’t know.

SAM: There’s something I can do when I force myself to do it, and that is one of the reason I want to talk about it is that is something I used to think about quite a lot and used to force myself to do but I got a bit lazy as per the name of the podcast. I wanted to be that more extroverted confident person, and I became that for a while but now it’s kind of retracted a little bit.

EMMA: Well I think that goes down to having the right opportunities and that goes back to one of the reasons why we’re so excited to go traveling again because actually living in Tunbridge Wells you can just not leave the house, do all your work, not meet anyone and not put yourself in any awkward or out of your comfort zone situations.

SAM: It’s very comfortable isn’t it?

EMMA: Yeah whereas traveling is putting yourself out there every day.

SAM: Yeah.

EMMA: Which we want yeah.

SAM: So that is one thing which I suppose I could put that down as confidence, not having a fear of rejection.

EMMA: And also not overthinking things. I think that three second rule. Just going for it. Not letting yourself build it up in your head.

SAM: I quite like that three second rule in general because it works for most things. I’m really scared of heights, jumping off a high diving board or a forklift. I have my just like, don’t think about it. Like count that in my head. Then you can do it. But when it’s you’re standing at the edge and you’re looking down you’re thinking, well I could just turn around right now. You start boring and overthinking things so there’s like that confident side. I would like to be better at. It’s funny because all the things, all these traits I look at I’m about to talk about are stuff I have addressed in the past, and have got a little bit less. A little bit more lazy at addressing recently. So the other one’s I’m gonna say is fear of conflict. When I say fear of conflict, but not not being comfortable with conflict and avoiding it when necessary. And it’s one of the things, I used to be a volunteer policeman where I did that in order to get better at dealing with conflict and dealing with people who are middle-class friendly and very polite which is everyone I meet in normal life.

EMMA: Do you think that helped?

SAM: It definitely helped, but there’s no magic. But it is just slowly, over years of mentally conditioning yourself and changing your personality until you are the person you want to be.

EMMA: And I think you’re really good in conflict. I think you’re very calm, very logical, you don’t panic. Much better than all my friends.

SAM: Yeah, like when stuff goes wrong, I’m very good and that’s partly because of this. It’s because you’re dealing with stuff going wrong all the time, and so if something bad happens, I’m quite good at just being like, okay, no worries, calm down, chill out. But what I will do in other times is purposely avoid conflict by just agreeing to something or avoiding a situation all together. Like not even conflict, stuff like haggling. I don’t like haggling so I purposely avoid haggling which is something that hopefully will be better when we go traveling is that we’ll be in a situation where you kind of have to haggle for everything.

EMMA: Yeah I hate haggling as well. I was terrible at it in Morocco. I went last October and my friend Lydia had to do all the haggling cuz I just I just couldn’t do it. And I think it’s practice.

SAM: It’s practice and it’s just being okay with arguing with people, yes that little bit conflict whereas I want to just be, I want to be saying yes to people rather than no. Yeah so those are kind of the strong traits I’d like. That confidence, I quite like that kind of military officer look, you know. Straight spine. Good posture. Which is funny cause I do jiu jitsu which is all about curling the spine.

EMMA: If there is anyone on TV that has really good posture, you always point it out and I always think they look like a dancer. The way they hold their shoulders and straight back, it’s very unusual.

SAM: Yeah it is. And that resonates like strength and control over your your body and your circumstances which I really like. And, you know, military officer that’s good in conflict that’s good at leadership. Tend to be a role model, telling people what to do. Not changing your mind easily and all that kind of stuff. That’s also balanced by my desire to be very empathic and understanding and to really get what is going on in other people’s minds.

EMMA: What a tall ask.

SAM: It is a tall ask because if you don’t have much empathy, it’s quite easy to not worry about what people think. If you got loads of empathy, it’s really easy to relate to people and to understand people and to all that kind of stuff. But it’s a lot harder to then tell them no or tell them the stuff they don’t want to hear, so it’s that kind of balance I’m looking for, and I’m not sure I met anyone who’s got that balance really well, but that is what I’d like to work for. So I mean it’s quite useful because I can now build the person I want to be, which will be hopefully a mixture of a few different people. And then just get used to in situations, being like if future Sam was here, what would he do? And then doing it. Give myself three seconds to just do it. Because the answer is always simple isn’t it. It’s not going to be, I think sometimes when you take yourself out of a situation, it’s a lot easier to know what to do. Like when a friend tells you about their relationship problems, there’s normally a really simple answer but because they’re so in the thick of it, they don’t want to to do that. I think that would be the same here. They walk into a networking event. If future Sam was here, what would he do? Well he would pick someone who he would really want to talk to and you’d go over, interrupt the conversation and introduce himself. Someone’s not performing, someone you’ve hired is not performing, what would future Sam do? I suppose something that we’ve kind of touched on but haven’t really spoke about is the idea of being a role model. Being something that people look up to. I once read a book called the seven Habits of Highly Effective People. I don’t remember anything about it, apart from that in one bit, the guy said that he was best man at six weddings or seven weddings and I was like, that’s who I want to be. You are that person that everyone calls on. Which means I need to get better at maintaining, building and being in relationships.

EMMA: Yeah.

SAM: So let’s bring this back down to the final question. Who do you want to be and how do you become that. And the answer to how you become it is, create this persona of future you and then ask yourself what would they do in this situation. And then do it. And it’ll be really uncomfortable at first, and then eventually it will be in your nature. alright well thanks for listening if you have any feedback please email me at hello at San precede calm and that’s about it any final words on us hey goodbye

#40:Entrepreneur’s Guilt

Sam on working incessantly:

“There’s always going to be more that could be done, that’s why people like Elon Musk work 24 hours in a day…

But I don’t want to be Elon Musk. I’m not trying to get us to Mars. I’m trying to enjoy my life.”

Resources Mentioned In This Episode Of The Lazy Entrepreneur Podcast:

Listen to this episode of The Lazy Entrepreneur Podcast on:

iTunes | Spotify | YouTube | Stitcher

Structure

00:00 Intros

01:49 Differences in Sam and Emma’s approach to downtime

2:38 Productivity in self-employment vs. corporate world

7:58 How sam divvy’s up his waking hours

10:37 Emma’s work outside of the corporate world as both less stressful and never-ending.

12:34 How to designate between work and non-work or “switch off” (drinks, food, activities)

14:07 When Sam muses on the difficulty of giving advice

15:21 Why sam rarely checks his emails

17:12 Emma’s advice to Sam

19:45 The structure and accountability provided by life coaches

22:30 The core tension that arises from having absolute control over your own time  

23:34 Dubious life advice: more picnics and alcohol?

Transcript

S: Hello welcome back to another episode of the lazy entrepreneur, I’m your host Sam Priestley and as normal we’re joined by the lovely amazing beautiful co-host and my wife Emma Priestley

E: Hello what an intro

S: That’s it I’m in a very happy mood today

E: Why is that?

S: don’t know why am i happy today

E: you’ve done a lot of jiu jitsu

S:  In two days I’ve got some admin out the way that I’ve been putting off which makes me feel good. I found our car insurance

E: congratulations

S: I hate doing and I’m recording a podcast which is one of my favorite things to do. Right so Emma today I want to talk about the guilt that you feel as a self-employed person as a small business owner any time you’re not working. This is something that I think that anyone who’s got their own business they’re trying to build where they’re completely responsible for their own time and I’ve got a balance life, balance work and balance health, balance family, feels

E: That’s good

S: It’s something that I still struggle with after whatever is 10 plus years of working for myself I kind of always have in the back of my mind I should be working there’s something more productive I should be doing which is weird because I’m completely in control my own time and that should be amazing, right? It should be every day I wake up for nothing, so I do some work? I don’t know it’s lovely outside, maybe I’d want even to go for a picnic and then if I choose go out for a picnic that shouldn’t really very guilt attached but that is that is why I do this right so that I can, on the whim, go out and choose to have a picnic or go to a museum or go go-karting or something random.

E: Have to say I do think I am the latter

S: You don’t struggle as much with this as me

E: No, I don’t, I mean I absolutely love my life and love that I can choose when to work and when not to work and I have to say I don’t feel guilty when I’m not working I feel happy in the week when I’m doing something that isn’t work.

S: You’re such a weirdo

E:  I think it’s because it’s so different from working in a corporate.

S: Don’t you’d feel like because you know that you used to work 9:00 to 5:00 on 8:00 to 8:00 or ever it was that that is what you should be doing now?

E: I think the amount I get done in one day of one hour of emails is way more than I ever used to get done in like a whole week at work.

S: mm-hmm

E: I just feel I’m so much more productive

S: Yeah, that’s not me.

E: But I think it’s because I’ve had the corporate experience, I’ve got something to compare it to whereas this is all you’ve ever known.

S: Yeah but when I’ve had times where I’ve done more and been more productive than other times so I always have the memory of being better and do more and always have a list of a million and one things that I know I could be doing and should be doing and want to be doing

E: yeah but I think where the the times that you think you’ve been very productive, I think you’ve been focusing on one thing. Success in your head is to focus on one thing and spend a lot of time on it. But that isn’t how your life is set up

S: Well yeah I’ve got this innate contradiction with my life. yeah I want to have kind of as much free time as possible… I’m doing this because it frees up time and I don’t particularly need to be working that hard at the same time I feel like I should be working and I should be be more productive and I should be doing more I should be doing more hours that’s a contradiction and it means I can’t 100% enjoy the downtime and I’m not getting 100% into work so I’m in this kind of middle ground where I’m guilty whatever I’m doing.

E: What do you think you would gain if you did a lot more work? Like do you think you would gain more money? Do you think you would gain more job satisfaction? Do you think you would gain enjoying the downtime? what is it you think that you’re missing?

S: Yea I don’t know, I don’t think there is a good answer to that because I think the problem with the guilt of thinking there’s more that you can do is that you’ve never done everything you can do, like there’s a never ending list of things that I want to be doing and I don’t feel I ever, like when I used to work a lot and do loads, I used to joke with ben that there weren’t enough hours in a day, cause there aren’t to do everything you want to do, and I think that in my mind I’ve got this distinction between productive stuff and time wasting stuff. And going for a picnic goes into the time wasting stuff. Watching TV goes into the time wasting stuff. Whereas going to the gym, doing jits, learning a skill, doing work all goes into that productive section.

E: It’s interesting isn’t it because those two examples like doing jits and doing a new skill, you need to have downtime, you just can’t be working and working out hah! Like it gets to a point where you train so much that you can’t move. And there is nothing that you can’t do apart from watching TV

Why fun is important 5:33

S: And I like having fun. So like I shouldn’t feel guilty for just kind of mindless fun. Like if you watch instagrammers who have the dream life or travel vloggers or whatever

E: THey how the dream life

S: I bet they still feel the same guilt that they can’t 100 percent enjoy whatever it is they’re doing and they feel they should be taking more photos or doing more work or going somewhere more photogenic or the light isn’t quite right here or whatever it is.

E: That would drive me insane

S: DO you remember that doc abt couple vloggers? Who are making like a career from being these perfect couples

E: Vlogging their relationship it would be horrendous.

S: And then they broke up and decided to continue faking it for these because that’s where their income comes from and they’ve got this distinction in their mind bt their real lives and work and it’s not real. I kind of new you didn’t really feel that guilt because a few years back we were travelling and we would go around the world and go to a new city and you would want to go and visit all the museums and do all the touristy stuff and i would be like “ well i’ve got to do some work” and you’d be like “alright then see you later,” and I was like “Shouldn’t you be doing some work as well, do you feel that guilt that you need to be, I don’t know .

E: Yeah, I think that the reason we set up our lives so that there’s a balance between life and work and I enjoy that to the max.

S: And we have a good balance, I struggle with it because I feel like I should be doing more and so one thing I started doing since January is recording my time and labelling what I do each hour

E: Do you think that’s helped.

S: Yeah, it has actually, and for instance, last month I roughly had it split to ⅓ of my waking hours was done working, ⅓ was done with friends and family, and then the other third was spent to productive stuff that wasn’t working so jiu jitsu, a few things like that, and I think that actually is quite a nice balance that you have the three parts of my life that are all really important have an equal proportion but that each one I feel like I’m neglecting slightly.

E: I think you have this mentality, hence why you’re starting a new business you absolutely love the beginning, the strategy, the planning, the excitement, it’s all you can think of and talk about, its 100% and then when it comes to the day to day running of it you’re less interested and you built businesses so that they run where you don’t have to do very much day to day but I think that it’s similar to everything in your life, you think you’re doing well at it and you’re really enjoying when you’re really 110% in it.

S: Yeah no that’s definitely true

E: But that doesn’t work it’s a contradiction

S: You can’t be 110% in everything

E: But is  about being in the moment?

S: I think that’s it because on the one hand I like to pretend I like being in the moment, I don’t like making plans, I like the flexibility of going on a whim to do something adventurous

E. Like that picnic last thursday, you suggested it in the morning, and then we were there.

S: SO I really like that side, but at the same time I’m almost kind of planning. Like on the next six months on the blog, or the business, or how we can grow our gin brand, or what we can do with our new table tennis products, or thinking about traveling and what life is going to be then, or other stuff I want to learn, or currently a bit of photography stuff like what courses I could take to get better at photography, thinking about writing a book or  creating a video game or all these kinds of random things.

E: Well i’m exhausted by that list, no wonder why you’re tired!

S: Yea I think it is about being in the moment which I think you’re definitely better about than me

E: And being in the moment for me, it’s got to be some sort of planning around it, for me I enjoy the planning and the expectation of what it’s going to be like and then I really enjoy the moment. I think i’m less good at enjoying spontaneous things and I think that one thing I do feel i suppose guilty is the right word is how much I look at my emails

S: MMmmm

E: WHen I was at my corporate job I  was very adamant that I didn’t have a work phone and I was only able to access my emails on my computer which was in the office so out of hours when I left the office, I switched off, whereas now I look at my emails before I go to bed and as soon as I wake up. And yes, I do sleep a lot, but, that’s not the point. I don’t have work hours. And so when people say to me that yesterday I had some meetings in London but then I shopped in between, people say, “Do you feel like you’re always working” and I say no because I got to shop in between, and then the flipside is do you feel like you’re always working and then I say I am always working because I am always looking at my emails.

S: Maybe the stress then is because the guilt that you’re not yet feeling is because everything is at a manageable level

E: Yeah I think that’s what it is

S: IF you had 10x the amount of emails per day than you think that would weigh on you, or more things than you could handle than that would start
E: That’s a good point because with the meetings you choose where you are, so if you had a day where I wanted to go spend time with my family I could go do that and then make sure there weren’t meetings on that day.

S: See you’re planning ahead but once it’s planned that’s it, whereas I’ll be halfway through my picnic but then I’ll think about a change I could make to the blog and then I’ll be like I want to go home and make that change

E: Whereas I’ll be at the picnic having a great time and thinking what can we do after this that’s equally fun? Not like “Alright I’ve had a few hours of picnic let’s go back to work.”

S: I mean getting a bit morbid, I think that’s why I enjoy having a drink at these things. Like now it’s time for switching off, it’s like a prop. I think I probably use jiu jitsu a bi like that, like while I’m doing it I’m not working.

E: Like it’s all encompassing.

S: And maybe for you it’s like social events are like that, having people to chat to, whereas if we’re in a group conversations I drift off and find myself doing something completely different.

E: Well I disagree, I think a lot of the time when I’m talking about work and I care about what my friends and family think and their advice so it’s something that I do talk about and sometimes it really winds me up and sometimes I find it really useful, no I think actually i would say that yoga is my jits, is my place to not think about work because the type of yoga that I do now is a lot of movement, there isn’t any static whereas when you’re say in positions, your mind does drift very easily ,whereas I have to concentrate so much on what I’m doing in this current yoga class that  I can’t think about work, which I think is great.

 

S: Well this was a strange episode, it was meant to be us giving our advice about the guilt of always being working but I don’t really have much advice to give. That’s what it is. I feel a lot of guilt that I should always be working, that there aren’t enough hours in the day and that there’s a bunch of stuff that plays into that, that we’ve created a balanced life that we are logically happy with, let me think through, but then the extra emotions that go along with that aren’t always logical.

E: Yeah and I don’t think it’s about advice, I think it’s about talking about this, about being honest, about what we think about our work-life balance and whether we’re happy with it.

S: That’s a good point, it’s not just about having a correct answer that makes sense like a mathematical formula.

E: There isn’t one

S: Even if there was, that doesn’t mean that your emotional subconscious or whatever will be in line.

E: I guess the one thing is to keep talking about it and reflecting because it does change

 

S: I suppose one thing to say is that I have made an effort to distance myself from certain parts of work in order to not feel the guilt, so one of which is that I rarely check my emails. Another one is my phone doesn’t vibrate or ring or anything like that. I have a bunch of stuff that encroaches on me, anything which people are pushing their stuff to me, I’ve distanced myself from a bit, with just stuff popping up and distracting me from whatever else is going on, so I’m the opposite, I won’t be checking my emails first thing in the morning and last thing at night, I’ll check them every few days and that’s been a conscious decision

E: Well with the GIn i tell you verbally. You need to pay this or whatever the thing in.

S: But on other stuff.

E: I’m your filter for that.

S: Yea and customer service stuff, I don’t do any of that. So instead the guilt I get is not from these random little stuff, it is more the big picture stuff, the opportunities that I am letting go to waste because I am not acting on them.
E: That’s enormous.

S: Yeah, and never ending. Especially when you’re like me and you spend all your time thinking, and that’s what you enjoy, and talking to people and being creative and thinking up new business ideas and stuff we could do and original businesses and opportunities, there’s always going to be more that could be done and more opportunities to explore that’s why people like elon musk work 24 hours in a day, because there’s always more that could be done, but I don’t want to be elon musk, I’m not trying to get us to mars, I’m trying to enjoy my life.

 

E: Chill out!

S: I shouldn’t be giving myself a heart attack at 40, or whatever it is, chill out, be more in the moment, maybe that is it. Maybe that’s it, maybe getting better at being okay at the guilt, because the problem is you get this guilt that you should be doing work which means that you don’t go and do these exciting things that you could be doing because you’ve got all this free time, but then you end of procrastinating and doing nothing, because we could be like, “oh, we could go to fort parth today.” Or why don’t we just pop over to brussels for a couple of days or whatever it is but we hardly ever do that because I don’t know.

E: Well I’m always thinking to do that, there’s a whole bunch of stuff I’d like to do in Kent.

S: And we could just be oh so spontaneous. Or we could just be like, Tuesday would be a good day to go to a castle.

E: Well I’m going to start doing that because we’ve only got a few months left and if we don’t do it now then it will never happen.

S: But when you suggest stuff like that I think that I should probably be working. Got loads of work to do.

E: No your answer is always you’re too ill

S: yeah I have been quite ill haven’t I, or that I might not be well on that day s o I don’t want ot commit to that. Well that’s a different discussion, but there have been times where I didn’t want to commit because there was probably some work I should be doing. WEll let’s wrap this up. Any last words of advice.

E: I think it’s good to talk about, I think it’s hard to talk about, it’s not an easy conversation but it’s good to verbalize this because it’s kind of hidden inside you somewhere and it’s something that if you do end up starting your own business you’re probably going to have to deal with.

S; If you’re going from a career where someone has given you what you should be doing, structure, and then you have to create structure on your own, even when you create that structure, I think that you do feel guilty outside of that.

E: One thing we haven’t talked about is life coaches and how we saw a massive trend with people who were working remotely having an hour call with a life coach on skype every week and it was so they were accountable.

S: Yeah there’s loads of stuff on that, there’s accountability, there’s people who are workaholics, who can never stop working ,or who can’t get started at all, and they’re both hiring life coaches or yoga instructors, or whatever it is. Therapists, military boot camp people to force them to shower and work a bit harder, but there is a bit of a trend to people who get more happy talking about their thoughts and feelings about stuff.

E: Yeah, when they’re struggling with stuff. It’s not “oh I’ve got the perfect life and you just need to copy what i’m doing.”

S: Especially when you’re ambitious or comparing yourself to other people, because one thing about the career is you have easy to see benchmarks for how you should be doing or how you should compare yourself, but there’s a lot more randomness when it comes to businesses, especially when it comes to blogging. How do you compare yourself to any other blogger? Some might just get lucky.

E: You have to go meet people and then be open to talk about the money, the number of views you’re getting, the stats around it, because otherwise you’re just on your own.

S: Yeah, and then you have this situation where there’s so much more showmanship and people get cars they can’t afford, they live a life that looks successful to projet that success to look at them in their yacht, or that their business is succeeding, or how do you compare yourself to that? How do you know whether you’re achieving what would should achieve? ANd the problem is, how do you know if you’re achieving what you should because you’re creating new industries, building stuff that wasn’t there before, it is just totally down to you and a bit of randomness as to how things do. And i can’t compare my hourly rate to what I would earn if I was in a business.

E: It doesn’t work like that.

S: Alright, well, let’s wrap it up. SO if you’re feeling guilty that you should always be guilty or you’re feeling guilty that you’re wasting a lot of time or procrastinating that you should be doing other stuff, or that you feel like you can’t enjoy your free time to the fullest or you’re stuck in a perpetual procrastination loop that you can’t really break out of it and be productive then you’re not alone and i think pretty much everybody is suffering from one form of this or another. We went to a networking thing not that long ago and we thought this was an idea for an episode and they thought, oh yeah that’s it of course. And this is it. This is a problem you’ll have to deal. And it’s a problem you have to deal with when you’re completely in charge of your own time when you can do everything you want or nothing! So yeah, if you want to talk about it, as I said i don’t particularly read my emails, but I’ll try if you email me, you can reach me at hello [at] sam priestley [dot] com or leave a comment on a blog post i’m almost certain to reply to you. Maybe the answer is more picnics and alcohol? And on that bad advice i’m going to say goodbye.

#39: Why You Should Get A Job And Not Start A Business

We flip our normal conversation on its head and talk about the benefits of having a job.

Resources Mentioned In This Episode Of The Lazy Entrepreneur Podcast

Listen to this episode of The Lazy Entrepreneur Podcast on:

iTunes | Spotify | YouTube | Stitcher

Structure

00:21 – Mixing things up and talking about the benefits of having a job
01:46 – Sam’s experience as a caretaker
03:26 – Cashflow and payroll woes in entrepreneurship
05:18 – Differences in reliability and punctuality in payment
06:49 – Careers look better on a CV
08:15 – Different approaches to mortgages
09:17 – The myth of stability in jobs
12:04 – How jobs can lull us into a false sense of security
15:00 – Jobs don’t guarantee upward mobility
19:16 – The relationship between age, enthusiasm, and wisdom
22:20 – Thoughts on retirement

Transcript

SAM: Hello and welcome back to another episode of the lazy entrepreneur, I’m your host Sam Priestley and once again we’re joined by my lovely co-host and partner in life, Emma Priestley.

EMMA: Hello.

SAM: Emma today I thought we’d flip what we normally do on the head and talk about why you shouldn’t start your own business and why you should just get a job.

EMMA: Oh, how safe of you.

SAM: Well that’s one of the benefits! Or is it? Yeah let’s talk about this because I’ve never really had a job, you have. You’re probably in a better position to tell me the benefits and you’re also in a better position to tell me what my fantasies about having a real job are complete nonsense. So I got this idea what it’s like to be a professional in the working place. High-powered and I feel like life in the city is a cross between Suits and then a peep show or something. On one hand I’ve got this idea there’s something glamorous to it and it’s full of stability and well paid and you get rewarded for working hard and you’ve got big budgets you have these amazing Christmas parties and you’ve got a corporate credit card where you can go out and get your champagne at the bars and lobster lunches and boozy breakfasts. But on the other hand I’ve got this side that it is a slow bureaucracy that gets nowhere and most people hate it and you’re stuck in a sweltering desk using spreadsheets that don’t really work and doing work that there’s a good chance you’re superiors see it and decide not to use it.

EMMA: Yeah well there’s a lot of truth in all of that.

SAM: And I’m not just talking about city jobs as well. I mean there is a benefit to just having a basic job. I lied I did have a job for a while I was a caretaker and to be honest I actually really enjoyed it because I made me a bit of money and there was no thinking about it. It was very much turn up, do your work, go home and just get on with your life.

EMMA: It was just money.

SAM: There was no stress about it and it was quite fun, you get to have a chat. Loads of tea breaks. I used to have ride-on lawn mower racing, it’s great fun. So yeah so let’s talk about a few things, so I’ve got a couple of ideas and there’s a few myths I think that people have about jobs that I want to talk about, so one of them is stability as you said. The idea that if you’ve got a job, it’s quite stable and you don’t have the variance, so our income each month is quite different. It’ll go up and down. We don’t know how much we’re going to be earning next month, whereas if you got a job, you’re told how much you’re gonna be earning and unless you get fired or get promotion you’re gonna earn the same amount.

EMMA: Yeah it’s more likely to stay the same or go up.

SAM: And there’s a reason why mortgage companies are more likely to give a mortgage to the employee than to the boss who owns their own business and that is because of the stability and they can count on it, which kind of makes sense because if the business is struggling, it’s generally gonna be an employee who gets paid first. The first person to take a pay cut or not to get paid at all that month is gonna be the guy who owns it.

EMMA: Yes.

SAM: In a good business anyway, I’m sure there are some dodgy ones where that’s not the case but definitely when I’ve been in businesses that’s been struggling with the cash flow, making payroll is the challenge and the people who will get their payment delayed will be the boss followed by the managers followed by the assistant managers and then finally being the average people at the bottom are the ones who are most likely to get paid.

EMMA: Prioritized.

SAM: And even if the business goes bankrupt, they’ll be paid right up until it goes bankrupt. I suppose the other thing as well is that you get paid immediately. As soon as you’ve got a job, you start earning straight away, whereas if you’re starting a business, it might take six months, it might take a year. It might take five years before you can pay yourself a salary.

EMMA: I mean there aren’t many jobs out there where you do get paid straight away, if you’re in a very big corporate, the chances are it’ll be delayed a long time and when I say long time, I mean you’re not necessarily gonna get paid on payday when everyone else gets paid.

SAM: Okay, but you should be right?

EMMA: HR is very slow and there can be a lot of issues, so whether it’s losing some of your paperwork, whether it’s some tax issue, maybe you have to pay a lot of emergency tax in your first few months of being paid and then you might be able to get some of that back.

SAM: That’s a bit ridiculous isn’t it? How can they get away with that? Because if you’re living paycheck to paycheck, or you’ve been out work for a little bit and suddenly you got a job, you need that money.

EMMA: Oh 100%.

SAM: You need that money to pay rent because any any non-employment benefits are going to stop as soon as you get the job, and then you got to wait a month for them to pay you and then if they don’t pay you for whatever reason you got to chase it up and eventually get paid a bit later.

EMMA: Yeah and that’s the other thing is the benefits.

SAM: Yeah that’s all true but you’re still getting paid quicker than we’re getting paid for Pipehouse Gin.

EMMA: Definitely.

SAM: And you do know when you sign up to the job what it is you’re gonna get paid.

EMMA: Yes there’s a contract.

SAM: There’s a contract and it says you will get paid this amount per year, and, to some extent you can rely on that.

EMMA: Yes.

SAM: Whereas when you start a business, you could be a millionaire in a year or you could have made nothing in a year.

EMMA: Or you could have made a huge loss.

SAM: Or you can make a loss, or you could have made loads of money but will have to reinvest it all back into the business. One of the other things about getting a job and having a traditional route is it is the traditional route. It’s what we’ve been trained to do. We know how to apply for a job, we know that you know once we get better doing interview or whatever and we build up our CV it’s gonna be easier to get the next job.

EMMA: Yeah and there is support for that.

SAM: There’s support, you get taught it a school, your careers advisor isn’t telling you to start a gin distillery, they’re telling you to go and get a job or go to the grad scheme.

EMMA: Yeah.

SAM: And there’s a whole grad scheme of stuff isn’t there, like set career routes that you start on and provided you put one foot from the other for the next 20 years, you’re gonna end up somewhere better than where you started.

EMMA: Yeah.

SAM: Whereas if you start a business, it works for 12 years and then it has to close down for whatever reason. You’re not necessarily any more qualified to start another business or to get another job, which isn’t totally true because you do have a lot of skills you’ve learned that should make it easier to start the next one, but it’s less tangible. You can’t really put that on your CV that you ran a business for 12 years and therefore you’ll be good at signing the next one, and therefore you should be paid more than someone who’s starting a new business. Like having a CV of loads of career stuff on it does have value to it.

EMMA: Yeah.

SAM: And more value to a bunch of failed or successful businesses that I have on my CV.

EMMA: Yeah and also the other benefits of having corporate experience or previous company experiences you can get access to things like loans and mortgages and credit cards and being able to rent a house, etc a lot easier.

SAM: Yeah, yeah. I briefly mentioned mortgages before, but it’s really difficult to get a mortgage if you’re self-employed. It’s even more difficult to get a mortgage if you’re earning a lot of money but you’re not paying yourself out.

 

EMMA: Yes.

SAM: So let’s say you have a business that earns a large amount of money. You might decide to only pay yourself a small fraction of that for whatever tax reasons and keep the rest in the business and just invest through the business but a mortgage advisor won’t be able to say, oh I can see your business is very successful and at some point in the next eight years you’ll be able to liquidate it at a lower percent tax rate. You can use entrepreneurs relief and get all this money out at 8% rather than pay it out now at 50%. Therefore I’m gonna give your mortgage for this amount. He’s gonna say, oh well you paid yourself this amount a year, so therefore I can offer you a very small loan.

EMMA: Yeah and the way it works for mortgages for people that work for themselves is to have a lot of money upfront.

SAM: I remember when I moved to London at first, I was running my business and I think I had 50,000 pounds in the bank. I had another 100,000 pounds or whatever in the business and the business was making something ridiculous like ten thousand pounds a month and I still had to get my parents to guarantee my rent on a flatshare in London because none of that was good enough for the loan agent, and they said I’d pay six months up front.

EMMA: Did you?

SAM: Yeah six-months upfront.

EMMA: That is a huge amount of money.

SAM: Well yeah because for whatever reason my entrepreneurial wasn’t good enough for them whereas if I’d had a job and I was earning a quarter amount of money, that wouldn’t have been an issue.So we talked about some of the benefits of having a job, let’s now talk about why these benefits might not be as real as they look on the surface. So stability is one of the big ones is that it’s considered very stable to having a job and that’s true up until you lose a job or you get fired and you can’t always predict that whereas with the business I will see it a year or two years in advance that the business is going down so I have a long time to prepare or to work harder, whatever is. Well with a job you could be happily working there one day, planning your next holiday and then the next day not have a job anymore.

 

EMMA: Yeah, you’re made redundant with no warning.

SAM: With no warning, no probation. For a lot of these things can be totally out of your control, you could be working for a huge chain and they go bankrupt. Like how many big businesses have gone bankrupt in the last few years in England?

EMMA: Well yeah. I mean, we’ve got a friend who accepted a job that was full-time and within three months the whole company was shut down. And they knew when they hired him that’s what was gonna happen but they still hired him anyway.

SAM: Yeah.

EMMA: And it was just a nightmare because he had no rights because he hadn’t gone through probation yet. He was too new.

SAM He didn’t get any redundancy or anything like that?

EMMA: No.

SAM: I think someone was yesterday or the day before was telling me that he got a job, moved to a new town for it, got there and was meant to start on like the Monday. Didn’t hear anything, phoned up on like the Friday and he was told the business had gone out of business, gone through liquidation and had no job. And he’d moved for it.

EMMA: That’s crazy.

SAM: Yeah but what can you do about that? Yeah, so jobs aren’t quite as stable as people think, and it’s not that they’re less stable than being self-employed, I think you’re much more stable in a full-time job but you think that you’re more stable than you are.

EMMA: Yeah.

SAM: When you’re self-employed, you’re always a bit worried that things are going to go down and you can see that ebbs flows of the business and your money.

EMMA: Along with the economy and politics and everything else that happens.

SAM: Yeah and so what you find is that a lot of people who are doing quite well with their own businesses tend to start stockpiling money and building up these big reserves because they know there is danger ahead, whereas people in full-time jobs we saw it with the recession that you got these families with say three months salary in the bank lose their job after 25 years and then three months go by and they haven’t got another job, and that’s it. Can’t make their mortgage, lose their house, got expensive car payments. They just never saw this lack of stability that was in their job, they got too used to it.

EMMA: Yes a false sense of security.

SAM: Even when you were working at PwC you were basically living paycheck to paycheck, paying off your overdraft with the next month’s salary. Yeah and if you’ve been out of a job for two or three months, what would you have done?

EMMA: I would have had to have left my flat share because I wouldn’t have been able to afford it.

SAM: Move back to your parents, not everyone can move back to their parents. If you got family imagine that. Well we met people who they’ve got kids and something’s happened and they have to move back to their parents in their 30s. And I’m not saying that can’t happen if you’re self-employed but at least you see the warning signs early on and you are always aware that there is that sense of instability.

EMMA: I think it makes you a bit more resilient.

SAM: Yeah because you’re constantly being faced with stuff going wrong.

EMMA: Whereas you’re not resilient at all when you’re in a corporate job.

SAM: Yeah because your performance doesn’t directly relate to what you’re getting paid.

EMMA: It definitely doesn’t.

SAM: And I feel like you’re by necessity self-employed, your income isn’t tied to your expenditure. It’s not like when I get some money in the bank I’d go and spend it. I have to choose how much I pay for rent, what car I get based on my expectation for how much I will be earning over the next year or whatever is but that is going to be completely wrong. My prediction is not going to be right and I’m gonna have to under predict and so then any money above that just gets added to whatever stockpile I’m building whereas if I know I’m earning whatever it is, four thousand pounds a month, I will be planning to spend that 4,000 pounds a month. I’ll be saying, well what flat can I afford to rent for four thousand pounds a month? And then getting the nicest one I can find. Whereas you don’t have that luxury as a self-employed person and so therefore you’re forced to be a bit conservative with your financial planning. So that’s one advantage. I also think that’s one advantage that isn’t quite a big advantage as we think it is. I think the other one is that you don’t have to think that much about your job, because well if I’m a caretaker, I don’t care that much about my job and I can go home and switch off, that’s not true with most professional jobs. You’re kind of indoctrinated into always being on and taking ownership for your role even though you’ve got no ownership in the company. So, back when people had BlackBerry’s, I had friends who had BlackBerry’s which they couldn’t turn off. They physically wouldn’t turn off, you turn off the work ones and they just turned back on and you couldn’t put them on silent and wherever they were they were meant to be on call and it wasn’t even that unusual. So yeah I’m always on call when I am self-employed and I’m completely I can always be working, there’s always more to do, but I think the same is true at work and if you’ve got a big presentation coming up next week, you’re gonna be working more hours than you should do if you’re trying to get a promotion, you’re gonna be putting in extra slog. If you want to progress in your career, you can’t just cruise.

EMMA: Yeah, absolutely.

SAM: Same as being self-employed. If you want to progress with your business, you can’t just cruise, you’ve got to work at it. But really they’re not that dissimilar. Because while in your career maybe the role you’re doing, you don’t have ownership of your own career progression and working on that and building that up, getting promotions is a job in itself. It’s like running a business. So we’ve got that. I think another advantage that maybe isn’t a big advantage as we think it is that it’s very easy, a set out and understood process.

 

EMMA: Yeah it’s low risk.

SAM: So going into a grad scheme, finishing university, going to the jobs fair, going to interviews at thirty companies and then being hired by one of them, seems like because it’s so set forward and everyone is doing it, that seems low risk and a good route to take.

EMMA: Yes the sensible route to take.

SAM: But as with everything, if everybody’s doing it, then it’s probably going to be undervalued, you won’t get paid as much you could do, there’s not gonna be that much room for creativity, and setting yourself apart. You’re entering a pyramid that is gonna get smaller and smaller the further up you’re going, so that might look like you’re on a logical career progression, not everyone can progress each step. Only half the people or whatever can get that promotion.

EMMA: Only the best, the real fighters.

SAM: Yeah or the luckiest, the people who happen to pick the the industry that’s gonna take off over the next few years.

EMMA: Yeah like freelance web developers.

SAM: Yeah or even more niche, like some type of programming language in a random computer science related field that suddenly gets really popular versus another type of computer science and programming which people stop using.

EMMA: Yeah.

SAM: So there is a lot of like luck and then you know you’re competing with everybody out there, they say what we said starting a gin business, well why are you making gin? It is so crowded. Well why are you getting a job? That’s a most crowded marketplace out there. You’re literally competing with everybody else getting a job. If you’re going onto a grad scheme, you’re competing with every other university graduate out there, how competitive can it get? So yeah it is a well understood route but that’s not necessarily an advantage, that just means everybody else is doing it and so there’s more competition. It’s harder to shine and you’re probably gonna be undervalued.

EMMA: It’s also making me think there’s something in the older you get as well, if you stayed in one career path, it’s quite likely that your skill set will become obsolete.

SAM: Yeah think of all these adverts on TV for retraining.

EMMA: Yeah and I think if you’ve got your own business, you’re entrepreneurial, you’re much more likely to be adaptable to that whether that’s an opportunity you see in a business or whether it’s adapting your current businesses to change.

SAM: I think that comes back to what we talked about in stability, is that if you’re doing a business that’s becoming obsolete, you see that a long way off. Whereas if you’re working in a job that’s obsolete and becoming more obsolete you only really realize it when you lose a job and can’t get another one.

EMMA: Yeah and I think that’s particularly affected by age.

SAM: I mean age is a huge one. So I’ve been thinking about age quite a lot, that when you’re in a career the benefits of youth are you know enthusiasm, energy, the benefit of age is you know wisdom, experience and the contacts you’ve made. And as you get older you lose some of that energy and enthusiasm but you do build the wisdom and all that kind of stuff.

EMMA: So it works well together.

SAM: And then there’s at some point where benefits of your age no longer outweigh the benefits of youth.

EMMA: Yes.

SAM: And then your value in the marketplace starts dropping, so if you’re the CEO of a massive business, your age, you don’t need as much enthusiasm and youth because your wisdom and contacts are worth a lot. But if you’re in a normal job that most people are doing, your wisdom, contacts, and experience isn’t gonna keep being worth more and more over time.

EMMA: Yes, you will be replaced.

SAM: You will be replaced by someone younger who will be paid less than you and has got more energy and enthusiasm and willing to make up for your wisdom by just working harder and you’re gonna be made a bit obsolete. Whereas you don’t really get that as a self-employed person. I mean how many is quite popular in sort of motivational forums and stuff to have memes and posts showing the aged that certain famous business people got into business. And so stuff like, you know, KFC the guy who started that was already retired from one career. There’s all these people who start their business at a really late age and succeed really well. Whereas you don’t get many 65 year olds joining a grad scheme at a bank and ending up as a partner.

EMMA: It doesn’t work the other way around.

SAM: At some point there is a tipping point where age and a career don’t really go that well together. People get forced to retire don’t they? You might want to continue working at 70.

EMMA: That was the other thing I was gonna say, at what point do you want to stop working and if you’re in a career path you might not have a choice.

SAM: Yeah, a lot of people don’t get that choice.

EMMA: Whereas you choose when you retire, maybe you never retire. That’s that’s how you think of work.

SAM: Maybe you never retire, you will be working forever. I mean if I’m not enjoying working it means I need to find something else to work on.

EMMA: It’s not an invitation to stop working, just to change.

SAM: I mean there aren’t really any studies on life expectancy for people who keep working past 65. I tried to look into this stuff before but I do believe that retirement and doing nothing and going from working full-time for a job to sitting with your feet up all day watching TV is really not good for you. I don’t have much data to back that up, but it’s something I believe and that’s why I don’t plan on retiring because I think work to some extent is good for you.

EMMA: I think there was something at work about people retiring and health care continuing for the first couple of years because that’s the most high risk of them having a heart attack and being really ill, that’s what was discussed about work. I don’t know the stats behind it.

SAM: Yeah I did look into it on a previous, for a previous podcast and they were conflicting studies and I mean it came down to what sort of job you were working. If you’re in a high-risk job or a physical labour job, then actually retirements good for you. Or if you’re in a high-stress job, then retirements good for you. Whereas if you’re not in either of those and you’re in quite a healthy job, that’s you know not too stressful on your body or your mind, actually working is good for you. But again there needs to be some more research into that. But you know I believe it. So are you happier self-employed or do you wish you had a job again?

EMMA: No I mean when I first started to be a freelancer and really realized I wasn’t at work, I used to have nightmares about having to go back to work.

SAM: Yeah I imagine it’s a bit like cuz I get nightmares about missing an exam at university, you know I haven’t been at university in a decade or something. I still have that dream. I imagine you might get that about work.

EMMA: Yeah I do.

SAM: Sleeping through your 6 a.m. alarm clock or whatever, or getting in trouble from the boss.

EMMA: Or being forced to go back and just absolutely hating every minute.

SAM: Whatever you’re going, I think that’s a good point to end it on. You’ve heard it from the experts, someone who’s been both self employed and having a job, she much prefers the self-employed route.

EMMA: Yes.

SAM: Although there are benefits to having a job, I think the benefits of not having a job and doing stuff for yourself outweigh them. And on that note, goodbye.

EMMA: Bye.

SAM: Thanks as always for listening, if you have any feedback email me at hello@sampriestley.com If you would like to leave a review I would be forever appreciative. I will forever love you. Goodbye.

#38: Marketing Is The Hardest Part

When starting a business the setup and ideas phase are what we normally focus on. And that is what most gurus or courses teach. But the reality is that that is only the beginning. Getting sales and customers is going to be your main job and the hardest job. But also where you have the most freedom for creativity. 

Resources Mentioned In This Episode Of The Lazy Entrepreneur Podcast:

Listen to this episode of The Lazy Entrepreneur Podcast on:

iTunes | Spotify | YouTube | Stitcher

Structure

02:12 – The allure of scale in Amazon FBAs
02:43 – Start-up and sales
06:19 – Marketing is a constant adaptation and experimentation
08:06 – Stats day: Sam’s monthly review
09:57 – How Sam and Emma plan to incorporate video content to Pipehouse Gin
10:20 – BrewDogs viral marketing approach
13:33 – The table tennis business and frontloading work
14:58 – Starting a blog in one hour
18:41 – How to know where to start with marketing
20:34 – Covering the full spectrum of table tennis business opportunities
22:10 – Looking at different marketing approaches depending on products (table tennis bats vs. gin)
23:20 – In summary

Transcript

SAM: Hello and welcome back to another episode of the lazy entrepreneur. I’m your host Sam Priestly, and as normal we’re joined by my lovely co-host Emma Priestley.

EMMA: Hello.

SAM: Emma, today I wanted to talk about what I think is the hardest part of business, and also the most underestimated part. And that is the marketing, the sales side.

EMMA: Yeah, I definitely agree with that.

SAM: I think that people really underestimate how difficult it’s going to be, and how important is. There’s this kind of idea that if you build something good, then people will come and somehow you’ll get some sales and I think that’s especially true with online business and e-commerce. People think that an Amazon FBA business has some sort of magical box that you put a product in and suddenly people will buy it.

EMMA: And that’s not the case at all.

SAM: You wouldn’t think that if you’re starting a High Street business, would you? You assume that you would actually have to tell people about it. But for some reason people think that if you follow this recipe to create an Amazon business, you’re gonna get sales.

EMMA: And also I think when you’re looking at a High Street Business, your expectation of customers is that you may have some sort of launch event and lots of people come in on the first day but then it takes a long time to build up a regular customer base. No one ever expects just because you’ve got visibility on the High Street that everyone’s gonna come in.

SAM: Yeah when we started the coffee shop, I remember everyone kept telling us, “Oh don’t worry, no High Street businesses ever make money in the first two years.” And I was thinking what?

EMMA: That’s crazy.

SAM: And there is this idea that when it comes to these magical online businesses, that people don’t really understand.

EMMA: If anything, they have the reputation that they actually give you instant income, rather than that they’re really hard to market and sell.

SAM: Yeah, and I think part of the problem is that you get one or two successors who’ve managed to create huge businesses in six months because the potential is there.

EMMA: Yeah the scale is there.

SAM: You never hear about someone starting a coffee shop and the next year making 10 million pounds, but with the scalability of online, it is possible that you could start a business and it’d be unbelievably huge in a very short amount of time.

EMMA: It’s a bit like saying, setting up an online business, you’re gonna be as successful with Marks and Spencer and Sainsbury’s. It’s absolutely ludicrous.

SAM: Yeah, and some of these businesses do end up being more successful.

EMMA: But that’s not the norm.

SAM: I kind of want to do a split business in two to two sections. I’m going to call one the startup and then one the sales side of it. This is particularly true about the modern type of business that I talked about in these podcasts and on the blog posts that we discussed quite a lot, in that the set up is largely about putting together supply chains of optimization that mean that once it’s running, it isn’t actually that much work to be done.

EMMA: Yeah.

SAM: That is the kind of dream that people see behind these Amazon FBA businesses and blogs and stuff like that.

EMMA: And by work, you mean you don’t have to put a lot in for the product to keep producing.

SAM: Exactly, you’re not sat at home packing stuff up and sending it out. You’re not carving it yourself. You find a supplier, you find a factory who can make the product to your specification, you build a supply chain which then helps get your product to wherever your distribution channels are, which could be an Amazon warehouse, or it could be another warehouse that you hire separately. And then you have optimizations that if someone buys it on your website or on Amazon or wherever, that gets automatically put through to whatever your distribution channel is and they fulfill the orders for you.

EMMA: Yeah.

SAM: So, as they say you can make money while you sleep because you can be asleep, someone can go to your website and buy something and then the next day it arrives and you haven’t done anything for that process.

EMMA: The only thing that you have to do is make sure there’s enough stock. Place a few orders via email to make sure there’s more bottles or more labels or whatever the thing is that you need.

SAM: And really the thing that is holding you back is the number of sales you can get.

EMMA: Yes.

SAM: Which then brings us on to the second part, which is the sales part. And I think the real reason why it’s underestimate so much is that a lot of educational stuff is focused on this first half, this setting up a good supply chain business.

EMMA: But it is really important.

SAM: It is really important and most people mess it up because they price it wrong and end up in a position where they’re not actually scalable or miscount certain things and there’s also the side of the business that I can actually give you a recipe for how to do it.

EMMA: Yes and you have done that in blog posts.

SAM: You can read my Amazon FBA blog post, I’ve done loads, there’s loads of episodes in the podcast.

EMMA: Particularly around pricing.

SAM: Around pricing, there’s one on how to set up an international supply chain as a one-man business. There’s a few things like that, and the reason is that you don’t need creativity. You can just follow the best practices and it will work, because there isn’t competition in this area. The competition is to get your business, not for you to find a unique way to do it, which sets you apart from everyone else.

EMMA: Yes because your customers can’t see that you’ve got the best deal with that supplier, or that you can scale in this way. All they can see is the end product.

SAM: Yeah it doesn’t matter, and the more efficient that is, the better. And the way they make that efficient is by creating something that works really well and then selling it to thousands of businesses. So the fact that me and another thousand businesses are using the same supply chain is a good thing.

EMMA: Yes.

SAM: Whereas if me and all those other businesses were using the same sales channel, the same marketing strategy, that just wouldn’t work at all. And that’s why the sales part is really hard, because I can’t give you a recipe. I can’t say, well you should spend this much on Google Adwords and do Facebook ads, and this is exactly how you set it up, and this should be your return on investment for every sale you get, because if I told you something that worked, then as soon as everyone starts doing it, the margins will get smaller and it will stop working.

EMMA: And the point is that with the sales and marketing, you’ve always got to be trying new things. There is no recipe that will work forever. You’ve just got to constantly adapt and things like Google algorithms, the algorithms that work on Amazon FBA, the podcast algorithms, they change. And usually, it’s about getting to the top of one of those three things. Well it is for us at the moment. So you’ve got to constantly throw different tactics at it so that your customers can find you easily.

SAM: So we did a podcast early on, did I do that one with you? It was episode number five I think. How to get sales for your business and in it I broke down ten different marketing channels you could use to try and get sales.

EMMA: Yeah.

SAM: Public relations, content marketing, community building, doing events such as optimization, business development, direct sales, affiliate or commission based marketing, paid advertising and pay-per-click and the key takeaway I took from that is you just gotta try a bit of everything. Work out how it works for you. I can’t tell you to do just one. What worked for one business won’t work for others. So something like adverts, Facebook adverts, social media adverts will work quite well for our gin but doesn’t work quite well for our table tennis bats. And there’s reasons for that, but there’s all kind of stuff that you have got to work out yourself and then constantly be experimenting, and constantly changing. Because once you set up your business, your supply chain that works and is automated and you know that now scale is your challenge, then the rest of your work is going to be on the marketing and the sales side.

EMMA: Yeah, well one of the things that we do on a regular basis for the gin is that you do it actually for all your businesses, you call it stats day. At the end of each month you review all of the stats for all of your businesses. So it includes sales but, we take it a step further with Pipehouse Gin and we look at the advertising as well. So, we look at how much we’re spending per click and then we look at how we should be editing that for the month going forward and it’s something that I think is really important for marketing themselves because you can’t set the strategy for the year and then just stick to that strategy month by month. You need to be able to adapt because things will work maybe slightly better or slightly worse than you first anticipated and you need to be able to move some advertising money around or change up the amount of time you’re spending on, say PR versus online advertising.

SAM: And you’ve got to have room for creativity and if you have an idea of one week, that there’s something completely weird and wonderful that you haven’t calculated into your marketing strategy, you should be able to go and try that because it might work.

EMMA: Well a classic idea of that would be this week I got quite into the idea of doing some videos for the gin.

SAM: Yeah we haven’t done any videos yet, but I’d been thinking about that this morning actually, and I was thinking it’s worth us doing some more events so we can get some video footage of us doing it. If we plan in say, six events over the next three months in different venues and then bring along a videographer to each one and then we can put together some amazing videos from clips from all that sort of stuff, and we can do events in bars, could do events in market stalls, we could do taste testing and stuff like that that we know would work quite well.

EMMA: We do have four events booked in for the next three months.

SAM: Yeah so I think it’d be good to get some video of that. Sometimes you’ll be chatting and you’ll come up with an idea and often the stuff that works most is stuff that goes viral is the weird and wonderful that nobody’s thought of before. Like look at Brewdogs marketing. Brewdogs is a craft beer in the UK, which is business for punks. And that’s all about their marketing strategies and their sales strategies and it’s all about doing weird and wonderful things like drinking a beer while skydiving and trying to make it go viral.

EMMA: Didn’t they airdrop beer in random places in London.

SAM: They might have. They do all sorts of things.

EMMA: Just for the exposure and I think they filmed it, didn’t they? Just crazy stuff like that. Like where does that idea come from.

SAM: Yeah the whole business strategy is coming up with ideas and then working on it. Yeah and look at cards against humanity who is buying up areas along the Mexican border to stop them putting a wall in.

EMMA: I didn’t see that.

SAM: And they did a crowdfunding so you could buy it like buying a bit of land along the border where they put the wall so they can block that.

EMMA: That’s so cool.

SAM: Just stuff that doesn’t work, doesn’t make sense. But it’s PR for them. Yeah they like bought a stadium and branded it with all their stupid slogans. They do interesting things that go viral and get media attention, so that’s obviously silly stuff but then you also got companies that will do loads of things. Not just around getting PR, because that’s kind of PR viral stuff we’re talking about. About another interesting one that we thought was quite interesting was the Fyre Festival.

EMMA: Oh yes.

SAM: Yeah there’s a documentary on Netflix about that.

EMMA: Well they made a promotional video for the festival before they sold any tickets, before they launched any information about the festival. They launched this video which was these basically supermodels on a beach on a boat having a party and they paid, was it ten million for it?

SAM: They didn’t really say but they spent a fortune on it and then they spent a fortune paying the Instagram models who were in it to promote it to their followers.

EMMA: Yes and it was it was hugely successful in the campaign in getting the sales because they sold very high-priced tickets to this festival very quickly.

SAM: Yeah.

EMMA: I mean the documentaries about what happened after, but from a marketing perspective they spent a lot of money, and they achieved their goals.

SAM: Yeah, and even the documentary itself is made by the marketing agency who created that video.

EMMA: Yes.

SAM: And so they’re leveraging all the bad stuff that happened from the Fyre Festival in order to get extra publicity for them as a business. Very clever.

EMMA: Very clever. Yeah so I mean we kind of want on a little tangent there, but that’s it is the sales, the marketing is really hard. Don’t underestimate it. With the gin, so we had a new flavor launch last week, two weeks ago, which took a lot of work to get going. But now it’s out there and there’s not much work around that new flavor. The work is getting people to buy it, getting sales for it. Same with my table tennis business. In my monthly report for the end of last month, I think I wrote about three lines on that business. That is my most profitable but it’s because it’s all kind of setup, it’s all automated and we just haven’t done that much marketing for it recently. It’s just kind of taking over all the work that we put in all that time ago and it is kind of starting to dip down a little bit as a result.

EMMA: It’s interesting actually because you had a whole day of doing marketing with your business partners in March on the bats.

SAM: Yeah I did a day on that but there wasn’t really much to report.

EMMA: Yeah that’s quite interesting isn’t it.

SAM: Yeah so we did a bunch of things, we changed the advertising, we changed some of our copy, we implemented a few extra things, so we did do quite a bit but it was all just little tweaks here and there. Not really much notable to report on, and the marketing side is the part that I do worst when it comes to the blog or to this podcast.

EMMA: Yeah because the blog and podcast are all about you and you’re terrible at promoting yourself.

SAM: Yeah I hate it. I would much rather it spread by word of mouth, but that doesn’t really work.

EMMA: it doesn’t work.

SAM: Who tells people about blogs by word of mouth? I mean that’s how I’ve got quite a lot of my readership but it’s been very slow. It could be so much bigger.

EMMA: It could be so much bigger and it just comes down to self-promotion and putting yourself out there and putting yourself up on this pedestal. All stuff that you are basically allergic to you. You’re like effectively shivering inside at the thought of all these things.

SAM: I mean to be honest starting a blog is really easy you can start one in a day I’ve got a blog post and have stopped blogging in one hour with a step-by-step guide on how to do it and it’s quite easy to monetize it as well, especially if you’re going down you know just adverts or affiliations, which are like refer a friend deals. It’s very easy to set up, but the challenge is getting people to visit your website. That’s the purest form of really what we’re talking about here. Sales is very difficult. Marketing is very difficult. And the type of business you do affects how the marketing works, and what your challenge there is, what is the fundamental challenge behind your marketing. So, for instance, we sell gin. Gin is quite an easy sale to most people.

EMMA: Mass consumers.

SAM: Most people like gin so our fundamental challenge is standing out among all the other gins on the market.

EMMA: Yes, why us.

SAM: Why us. Whereas I’ve got a friend who’s got a vodka business and his business is slightly flavored and is meant to be drunk with tap water. It’s meant to be lowering calories, it’s like a healthy option. It’s a unique product that no one’s ever seen before. So, he doesn’t have any competition, but his fundamental challenge is telling people why he exists.

EMMA: It’s the education side.

SAM: The education side of it.

EMMA: That the customers need his products.

SAM: We don’t need to tell people why they should be drinking gin. He needs to tell people why they should be drinking his products. So even though on the surface we’re quite similar products, we’re both selling spirits. The fundamental marketing challenge is very different. And, whatever business you’re doing, that’s going to be the case. And even, even if you’re doing like an Amazon FBA business. On the surface it sounds like they’re the same. Two people, I’ve got loads of friends who have Amazon FBA businesses. I’m not gonna tell you what their real business are, but let’s say one person has a business which is a beard balm business, and another one who’s got a table tennis business, my business. We’re both Amazon FBA businesses, we’ve both had that first set which is very similar in finding suppliers, creating unique products, creating supply chain, getting onto Amazon, but then the actual sales side is completely different because it’s different audiences. And me telling you how to market your Amazon FBA business, how to get sales for your Amazon FBA business isn’t particularly helpful when businesses are so separate. And yes there are some crossovers, like the algorithms work the same, you know you want to become high on the best-selling list on Amazon. You want to appear in the search results on Amazon, you want to use Amazon adverts and gets some sales on that side.

EMMA: And also google as well.Your website needs to appear highly on Google, you want some some positive PR on Google’s searches, so whether that’s blog posts about your product or about you, you want to make your business and your product look effectively bigger than it is and also professional.

SAM: And how you do that, there isn’t really that much crossover between a table tennis business and a beard oil business.

EMMA: What about talking about some of the success stories of product businesses, particularly Amazon FBA businesses that you know of.

SAM: Yeah I think the first step of this, this shouldn’t put you off, it just means you should focus a lot on the marketing side of it. And I mean the first step is to listen to the podcasts and go listen to episode number five or read the blog post that corresponds to it where I go into those ten different types and give examples of each and then use your creativity to work out how to add your own unique spin on it and how to experiment with it.

EMMA: And where to start because you can’t do all 10 or however many there are in one go. It’s just not physically possible, budget and timewise. You’ve got to focus and then adapt.

SAM: Yeah you know an answer to your question, what worked for us with our table tennis business, the main thing that seems to work for us is having a few blog posts that run quite well that then lead to traffic onto Amazon. That worked quite well but again blog posts are getting less popular nowadays, so that seems to be diminishing a little bit. Also what worked for the coffee shop, which is a physical location business, which is very different, that was a bit of PR appearing in some of the best of London, winning an award for best new coffee shop London. And a few other things that worked quite well there for the gin, events have worked really well for us, so doing market stalls, getting in front of people has worked quite well. Getting a bit of publicity from local bloggers and local newspapers has worked quite well.

 

EMMA: Yes but we have yet to crack online.

SAM: Online we’re doing okay but we need to put more effort into that and one thing I think will work quite well for that is going to be social media marketing. What other businesses are there?

EMMA: The other thing I was going to say around table tennis is your concept around the sales net.

SAM: Yeah, yes I got this idea that with table tennis, me and my business partner between us, we cover a lot of different aspects of table tennis. So we have, the most profitable is a business selling table tennis equipment, but my business partner also has a blog that earns decent money.

EMMA: And has a lot of traffic

SAM: And has a lot of traffic. There’s also an online series of courses to attend university which you pay for video education on it. We’ve also written a book, Expert in a year: the ultimate table tennis challenge. We’ve also got youtube video that went viral and it’s got 10 million views. We’ve got all these kind of things that earn money in their own right but also then lead to the other stuff, so on that video we’ll have links to the blog, we’ll have links to our products, we’ll have links to the book. In the book, we’ll have links to the products, we’ll have links to the blog, we’ll add links to the Table Tennis University education and these are all channels that do well on different places. So, if you search for Table Tennis on YouTube, you might well come up with our video. If you search for Table Tennis on Amazon you’ll come up with our book and our table tennis bats. If you search for Table Tennis on Google, you’ll probably come up with the blog. There are all different ways that we use that each individually make money, but they also help funnel traffic around between all the other businesses. And so that is a business where we don’t actually do much paid advertising, we don’t do much traditional forms of advertising. Instead, we build little businesses at different corners of the market that then hopefully tie in all together.

EMMA: Yeah.

SAM: But that works particularly well for that type of business because it’s very niche. But if we had a stall in the middle of Tunbridge Wells where we lived, selling table tennis bats, we would get hardly any sales. Where that works really well for gin because there’s hundreds of people, thousands of people in Tunbridge Wells who like gin. But there aren’t thousands of people in Tunbridge Wells who want to buy a table tennis bat.

EMMA: And you’ve done a podcast on this, on the sales net.

SAM: Yeah so they’re quite different. And it is not worth trying to conquer every corner of the market for gin. There’s too much competition on YouTube, there’s too much competition on the blog space, there’s too much competition in books. And it might be worth trying all those and in fact we will do but as our main sales strategy, it works much better for something very niche like table tennis than it does for gin.

EMMA: I mean I was just thinking while you were talking, it would be really cool to do a cocktail cookbook with our gin and each recipe could be created by one of the bars and restaurants, like lots of different bars and restaurants in Tunbridge Wells. That would be so good and that would sell really well locally.

SAM: It would sell really well locally, and then all those bars and restaurants would have it for sale in their place, and then they’d all have to stock our gin because it’s about the book.

EMMA: Yeah and that’s just a marketing idea.

SAM: It’s my idea that could make money, but also help settle the gin as well and give everyone local a reason to hear about us and a reason to push it.

EMMA: Yeah and we would do self publishing through Amazon which people could buy online as well.

SAM: Yeah yeah potentially. There’s loads of ways we could do it. Again, it’s quite a bit of work but it’s something that could be really good. Alright, well let’s sum up again, we keep going on tangents but that’s alright Sorry, so splitting business into two sections, we’ve got the setup phase which in modern business is a lot about the optimization.

EMMA: And supply chain, price.

SAM: Making sure that everything is scalable, doing all your pricing. Making sure that you have a solid business that once you get sales will make money and will be profitable.

EMMA: And can be scalable.

SAM: And scalable, yeah. If you get a thousand sales in a month.

EMMA: You can fulfill those orders and have stock next month.

SAM: And don’t get me wrong now that is a challenge and for instance with the table tennis business, one of the reasons that we haven’t done that much recently is because our factories aren’t able to produce as many bats as we can sell.

EMMA: Yeah which is a very good place to be.

SAM: Which is a very good problem to have.

EMMA: But it is a problem.

SAM: But it is a problem and that’s because we sell thousands and thousands of those bats but that’s not a problem you got to worry about right now. For most people, the main problem is going to be the sales side. To get to that point you need to focus on the business side and then the other side, the side that’s going to take most of your time once the business is up and running that’s going to be the hardest part and needs much creativity is the sales and marketing side. Awesome, well thanks for listening. Please don’t take this as a putting you off from starting your business. I just want to prepare you that that is the

EMMA: It’s a realist perspective of it.

SAM: It’s realist. But it should also give you confidence that one side is quite straightforward and you can follow courses or guys to do, and that setting up a scalable business is very doable and there’s loads of companies out there that will help you set that up quite easily and there aren’t really many secrets in that space. But then there’s the creative side, the marketing side which is all down to you, and if you can come up with a way to get sales that nobody else has thought of then that is it, your business will do great.

EMMA: And it is really fun.

SAM: Because we all like being creative, we all like having ideas. And on that note, bye.

#37: If You Can Plan A Wedding You Can Start A Business

 

Sam, on transferable skills:
“I had this idea that I had a certain set of skills that makes me slightly unique, slightly unusual, that meant I was better at starting businesses than the average person. Then, you come along and organize this amazing wedding, doing all the sort of stuff that I find really difficult and taking it in stride, and I thought, ‘Actually, no, maybe it’s just people don’t realize how similar these things are.’”

I chose to start a business with Emma after I watched her plan our wedding and saw just how useful her skills would be. Setting up a business and planning a wedding are very similar. From finding suppliers, logistics, budgeting and creativity. And I would go as far as to say, if you have organised a wedding, you can start a business. 

Resources Mentioned In This Episode Of The Lazy Entrepreneur Podcast:

Listen to this episode of The Lazy Entrepreneur Podcast on:

iTunes | Spotify | YouTube | Stitcher

Structure

00:41 – Getting married and immediately starting a business
01:46 – The overlaps between starting a business and planning a wedding
03:50 – The importance of customization
07:50 – Example of how entire projects can be held up by one detail
09:44 – Emma and Sam’s initial planning of the wedding happened on a flight to Budapest
12:11 – The benefits of being direct: “Can you just tell us how much it is?”
14:20 – Emma explaining the nuances of start-up costs
16:14 – Nobody has experience planning a wedding until they do it
19:02 – People make time for what is important to them

Transcript

SAM: Hello and welcome back to another episode of the lazy entrepreneur. I’m your host Sam Priestley and as normal, we’re joined on my lovely co-host Emma Priestley.

EMMA: Hello.

SAM: So to everyone listening who doesn’t know, we’re married. Did you know that?

EMMA: Yes!

SAM: We got married in July 2017, and then literally as soon as we got back from the honeymoon, we went to your brother’s wedding, then went to Ibiza, then we came back and then we started a business together. We started our gin business, Pipehouse Gin.

EMMA: Which is mad when you think about it, why would you get married and then start a business together?

SAM: Well I think this is what we’re gonna talk about today as one of the reasons is that you did maybe 85 percent, maybe 95 percent of the planning for our wedding.

EMMA: You mean 100%. You’re being very generous on yourself there.

SAM: Emma did most of the planning for our wedding and the whole time we were going through the planning, I kept thinking how similar this was to setting up a business. How similar it was to doing something like an Amazon FBA business. Almost every part of it and I kept thinking as we’re doing it, how good you were at planning the wedding was gonna translate so well to starting a business and all the kind of stuff that I really struggle with when starting a business, you were absolutely smashing it during the planning of the wedding. And so I left that thinking, oh let’s let’s use those skills of Emma’s and start a business together. Which then turned out to be Pipehouse Gin, so let’s talk about what I mean by that. When you start business, let’s say you’re gonna make a product like a table tennis bat or a bottle of gin, you got to work, you’ve got to find someone to supply the bottles, you’ve got to find someone to supply the corks, you’ve gotta work out someone who can actually make the gin for you, you’ve got to sort out the recipe, you’ve got to do all the creative stuff, you got to design what things look like, you’ve got to find companies who are able to print that for you at an affordable rate, that’s all very similar to doing a wedding. You’ve got to design your wedding invite, design the look and the feel, the day, you’ve got to make sure that it’s unique and different to everyone else wedding but still similar enough to a wedding that everyone understands what’s going on. You’ve got to deal with lots of little suppliers, there’s a whole budgeting side of it, you’ve got a set amount of money and you’re constantly negotiating price shopping, going from company to company to company. You’ve got to make sure everything happens at the same time, so much harder if we our bottles are delayed by a week, that’s annoying but it’s not the end of the world. If something’s delayed by a week for the wedding, that’s it the wedding’s over.

EMMA: Well that’s it for that supplier, you need to find someone else.

SAM: Yeah but if they promise they’ll have it done on that day and then they don’t deliver, then that’s it, you’re screwed. So you have to have backup plans. Like organising the person to do your hair and makeup, you had a couple of backup plans because you’re dealing with such small suppliers who were so bad at replying to messages.

EMMA: And they cancelled.

SAM: And one of them cancelled the week before or something. In fact when you’re doing a wedding, there’s the more moving parts going on. You’re dealing with more suppliers than you would when starting a business.

EMMA: Yeah and I think with the supplier side you really have to go with your gut feel, you tend to do some research online, get some prices, get some quotes, get an idea of who’s available and what they can do, and then you really need to meet with these people because you need to gain that trust because you are putting a lot of pressure on them to deliver something and if they don’t deliver, that will really affect your day.

SAM: And it will affect your business, and like the customization side of it as well, you’re not just wanting a generic invite or a generic band you want one that’s customized in a certain way for what you want and what you want the wedding look and feel to be like.

EMMA: Well that’s the thing isn’t it, like you can have a generic wedding, you can go to a venue that will give you a package for a certain price which will come with a wedding planner. You can do a lot of this research for you, or on the other side you can do every single piece of research, decision customization yourself, but within that just like a business, you can’t customize everything because it costs so much money so you have to look at what are the things that you really care about in the day as well what you care about in the business what you’re gonna spend money on versus what are you going to try and cut back? Because there are so many elements you cannot afford to do everything.

SAM: Well it’s the same with our gin, so what I think of in particular was our bottles. So we ended up choosing bottles off the rack and we didn’t customize our own bottles. We don’t have them engraved with our logo or anything like that, which we could have done but that would have been another next step that we decided not to do.

EMMA: Yes for launch.

SAM: And just like there’s 101 things with the wedding that we could have taken that step further. Something else I was thinking that had a lot of similarities between getting our label designs and doing our branding, and getting new wedding invites done.

EMMA: Yeah.

SAM: So with the wedding invites, Emma really wanted kind of cut paper,

EMMA: Laser cut

SAM: Laser cut paper, done with a design we chose. A design that we’d come up with. We had a tropical themed wedding that was a mix of English rose and Brazilian party was the vibe, so you wanted like a tropical cut wedding invite and for the labels on our gin, we wanted something that looked amazing, really high-end, really good quality paper for both of them. We started off by going to proper design firms who specialize in making exactly that.

EMMA: Yes and they charge an unbelievable amount so the labels for the bottles I think they started at $80,000 just for design, not for the printing. And then the invitations, I think the first person I spoke to specialized in Indian weddings, so a huge scale and the budget was really high and I think it was something along the lines of about a thousand pounds an invite was their normal customers.

SAM: It was unbelievable. Unbelievable, and then both of them, you didn’t change what we wanted, we just then found other ways around it.

EMMA: Well yeah I mean I used, I did a Skype call because we were traveling while we were organizing the wedding, so the Skype call with this company and this lady very kindly spent about 45 minutes talking me through all the different options and basically helped me to create a spec of what I wanted and then I could go to a much cheaper option. Because I didn’t know any of the language, I didn’t know what all the choices were I was looking online, but it was all just a bit confusing really. So to actually have a specialist, have a personalized consultation with you was really helpful and something that we wouldn’t, we didn’t, we couldn’t do with the label because someone would have charged us for that.

SAM: Yeah well maybe we could have done, I bet a lot of these companies would do an initial consultation for free.

EMMA: Yeah, actually, I think remembering back with the labels I know the company we went for is in Scotland but I think quite a lot of the companies were quite far away from where we were graphically, so we never really discussed meeting with the label company did we?

SAM: No.

EMMA: And actually looking back, it may may have helped us a lot to be able to meet an Account Manager face to face.

SAM: Or something like the labels actually ended up delaying us by quite a long time.

EMMA: Yes for multiple reasons.

SAM: Multiple reasons and the labels were something that, yeah, pushed our launch date back by a couple of months or something.

EMMA: But were very very important to us.

SAM: But very important to us and we’re very price conscious about it because it’s not just about looking good, but we also needed the price per bottle to work out in our favor.Because unlike with a wedding because when we’re selling gin we know how much we’re selling each bottle for and so we know how much margin we need. And so then we can backtrack everything, you say this is the max we can spend on this one thing, and if we spend more on that one thing, we’ve got to take from somewhere else. So we kind of had this idea of the max we could spend, in this case it was finding a company who’s able to do that in the quantities we wanted.

EMMA: Yeah and work with on an ongoing basis as well or as a wedding as a one-off.

SAM: Yeah I mean it’s not exactly the same starting a business and planning the wedding and obviously there’s the whole marketing and sales side at the end. It’s not hard to convince people to come to your wedding, it’s a bit harder to get people to pay for your product. But it’s more the kind of setup that I’m really thinking about here, and in that sense, they are in a lot of ways almost identical.

EMMA: Yeah, it’s interesting that you said that during the wedding, you noticed that a lot of the planning, the admin side, I was really good at and you don’t think you’re very good at, but it’s interesting because the part of a business that you really enjoy is the setup and the strategy and the creativity and the ideas, so it’s funny that that doesn’t also marry with the actual getting excited about, I guess it’s the admin side of it. Making it happen.

SAM: Well with the wedding, similar to how we started the gin, so with the wedding we had a whole load of magazines, we were on a flight to Budapest and we sat there and basically planned what we wanted for our wedding. The things we wanted, the theme, various ideas we had and then you kind of went with that and then ran with it and then worked on a lot of initially gritty. For instance, on the way there we decided that we were going to get married in my home church and that therefore we wanted the venue to be around there, and we kind of set ourselves a budget and we said this is how much we want to spend. So from there, you went and started contacting all the different venues around, as well as explore some of the more unusual ideas for venues that could save us a bit of money.

EMMA: Yeah, well the most important thing with a wedding to start with is to get a date. You need to have an anchor, so for us it started with the church being available and it turns out they actually had quite a lot of availability, which was very helpful and then trying to find a reception venue that was available.

SAM: Yeah I suppose there’s a similar priority list when it comes to a business. When we think about starting the gin, so labels we could work around that, bottles we can work around that. The most important thing was finding a distillery who would work with us.

EMMA: Yes.

SAM: And who could do it for a set price. If we couldn’t sort that out, the rest would be a waste of time. There’s no point finding someone who can make cardboard boxes to put it in if we can’t sort out the product first. So now as the first thing, now is the first step and you made a big list of every distillery in the country, we decided what our requirements were. We did a little research to work out how much roughly we should be paying per bottle and then you started contacting as many as possible. Likewise with the wedding, once we had a venue in this sort of rough area and we had a bunch of different dates, you then started contacting them till you found one that suited and was in the right price range. Same with budget really, so at the wedding it’s the overall budget we had. Whereas with the gin, it was kind of the price per bottle. So with the gin we wanted to do the whole venture for under ten thousand pounds and we wanted each bottle to be profitable, and that did, right off most of the distilleries who replied back with quotes, so we were left with actually not that many options of people who wouldn’t work with us on a small size and who could do it for a certain price. Same with a venue. Do you remember we booked in a bunch of venues to go visit and venues are often a bit hesitant to give you their prices upfront, and often they want you to come in and see everything before they’ll give you the price and we were doing this, we were going around to a few venues in one day and I remember one of them you phoned up or something and were like, “Can you just tell us how much it is?” Because we were booked in there later and they eventually sent us the price and it basically took our whole budget up just for that venue so we cancelled the visit.

EMMA: Yeah I was gonna say, I don’t remember seeing any other venues because we didn’t did we? We only saw that one.

SAM: Well we ended up cutting out so and luckily the first one we checked out was ideal. But also, we had a lot of lot of requirements, just like we’re starting out with creating a product. We want to hear about customization. We wanted certain food options.

EMMA: Yeah well we wanted to bring our own alcohol.

SAM: We wanted to bring our own alcohol. One thing we did for our wedding is we did a wine tour beforehand, where we we traveled around France and Germany and Austria, visiting vineyards to pick up wine for the wedding, and we had a wine tasting table. And there’s not many venues who would let us bring our own wine without charging an extortioner fee for corkage.

EMMA: Yeah got some friends that are getting married in Switzerland in October, you should hear how much their corkage per bottle is in Switzerland. Unbelieve.

SAM: And that was something that we also found, maybe not so much with the gin but with other products I’ve done. You’ll contact a company and they’ll say, ok we’ll do what you want but our machinery only lets us create things in certain shapes, so I’m thinking in particular, we made these cases for our table tennis bats. It was something unique. No one had created table tennis bats that looked like this before, so we had to find a factory that was doing something similar enough so we found a company who did laptop cases, and then it took us a long time to find a supplier who was able to actually create them in the sizes we wanted for in the price range we wanted.

EMMA: I think that’s a really interesting point because if you compare that to a wedding, you need to produce a lot of items for weddings, even just looking at the stationary, we’ve talked about the invitations, but there are things like: place cards and signage and menus and order of service and all those things that need to be printed. Now if you look at it from a business point of view and when you’re looking at scale, you typically have to pay a set price to create a plate, so whether we’re talking about creating the labels, whether we’re talking about bat cases, but there’s startup costs and it could be anywhere between a couple of hundred to thousands of pounds, which obviously, when you look at a wedding, you can’t justify that money.

SAM: Well some parts are quite straightforward, some parts are harder, as you say, we can do stuff at scale. So, for instance, with our latest batch labels, we were able to do ten thousand labels and so because of that we managed to get the price down per label quite a lot. Whereas when you’re making placeholders at a wedding and you’ve got 100 guests then you can’t do it at scale, so you have a lot less choice. Or you’re paying a lot more per item.

EMMA: I think it’s the latter, you’re paying a lot more per item.

SAM: Yeah, ends up being a similar price. One thing we’ve been looking at recently is doing kind of beer mats but for our gin, so we can just give them out to bars and they can just hand them out and it costs a similar amount to do a hundred thousand of them as it does to do twenty thousand of them. Once you get to that sort of scale the price increase is negligible.

EMMA: And then how do you pick how much you buy?

SAM: Well then the problem becomes storage. Just give them out to as many people as possible? Yeah, the more I was watching you do the wedding stuff, the more I was thinking, oh, this would be perfect for a business. But so many people organize a wedding and very few people start a business, and nobody has any experience doing a wedding until they do it.

EMMA: No.

SAM: It’s not like we have these ingrained skills that mean that you can organize a wedding, the same people are really excited for organizing their wedding, and people do it every year.

EMMA: Well it’s a happy occasion, it’s getting all your friends and family together and it’s a celebration and it’s a happy occasion.

SAM: What I am trying to get at is a lot of the excuses people use for not starting a business would also apply to a wedding as well, but everyone still manages to have a wedding. Like you don’t have enough time to do it, well most people organize a wedding in their part time around their jobs and it’s really tough and they say it’s one of the most stressful things they’ve ever done, but they do do it. Stuff about not having enough money, who has enough money to have a wedding?

EMMA: Yeah.

SAM: At least with a business, you’re expecting to get that money back later, like a business can be profitable. A wedding is a huge expense, then gone forever. Stuff like, you don’t know where to start, you don’t know where to start with a wedding. You got to then do your research, you got to spend time googling, talking to people who have experience with it. And spend a lot of time talking to suppliers and having a bit of trial and error.

EMMA: Getting advice.

SAM: Stuff like, you’re not very good at maths and accounting. Well the same is true for a wedding. You’ve still got to create a budget, you’ve only got so much money you got to spend. Same with starting a business. So I think what really struck me is that I probably had this idea that I had a certain set of skills that make me slightly unique, slightly unusual that meant I was better at starting businesses than the average person, and then you come along and organize this amazing wedding, doing all the sort of stuff that I find really difficult and taking it in your stride, and I thought, “Actually, no, maybe it’s just people don’t realize how similar these things are.”

EMMA: Yeah.

SAM: And that actually a lot more people could just go for it and start business and do really well. Maybe my uniqueness is that I’ve gone and done things where a lot of people haven’t and that’s it.

EMMA: I think a big part of it is the confidence. I don’t think anyone looks back at their wedding that they’ve planned and think, I’ve done really well planning, and actually I could use those skills to set up a business. I’m thinking of a few friends in particular that have gotten married in the last couple of years where we’ve been to their weddings, and they work very long hours in their current job. They really like their jobs, but whenever we meet with them, they’ve always got these ideas of businesses they’d like to start, but I really think they don’t see their current skill set in their head as the skill set that’s gonna help them to set up a business. And also, I think it’s too much of a risk, so we’ve also got a lot of friends that have got mortgages and very expensive lifestyles and I think they can’t see that making a jump, leaving a mainstream job and going into setting up something on their own, I don’t think they could afford it.

SAM: But that’s it, they afforded a wedding.

EMMA: Yes and how did they afford a wedding if they can’t afford to not be in a full-time pay for a year?

SAM: Well they don’t even need to quit their jobs, they did the wedding while in their full-time jobs. They can start a business in their full-time job.

EMMA: And again I don’t think people see that, that they found the time to do the wedding so why couldn’t they find the time to do a business?

SAM: And likewise, we spend a lot less money starting our gin business than we did on our wedding. And the gin business is profitable. It’s a bit ridiculous really. But as you say, those things crossover.

EMMA: And I think it’s confidence. I think it’s confidence, like there’s no way I could do that.

SAM: And they don’t see that the skillset aligns, and likewise the only reason I know to do it is because I’ve done all this stuff setting up other businesses. And I saw you following almost the exact same steps, but doing it a bit better than me but for the wedding.

EMMA: But then at the same time, I never would have thought that either unless you’d said it.

SAM: Yeah exactly.

EMMA: I wouldn’t have thought, “I did a really good job planning this wedding so I’d be really good at the organisation side of setting up a business.” If I’d never met you, I wouldn’t have ever had the confidence to then do something, do a business afterwards.

SAM: And there’s a bunch of other things, like when you’re doing a business it’s all on you, you don’t have any parents telling you what to do.

EMMA: Yeah.

SAM: Any crazy mother in laws, my mother in law was amazing. But we’ve got some friends that are having some mother in law difficulties. If you choose a label that people don’t like for your bottle of gin, then no one’s going to particularly care. It doesn’t matter if you hurt anyone’s feelings, whereas if you invite the wrong people to your wedding that can stick with you forever. People never forgive you.

EMMA: Yeah it’s true, there’s a lot of emotions that go into a wedding. And I’m not saying there isn’t setting up a business, but it involves a lot of your close friends and family and everyone has their own opinion. And there’s something about a wedding that kind of makes people a little bit crazy.

SAM: People have their own opinion and they feel like they should have a say in it, which is a bit weird because it’s your wedding. But they don’t feel like they should have a say in your business.

EMMA: Yeah exactly! They’re very supportive once you’ve launched it.

SAM: Yeah, yeah. Awesome. Well let’s call it a day. If you got a wedding plan coming up, consider cutting the budget in half and using the other half to start a business. That’s my advice.

EMMA: I’m not sure I’d agree. I’d take that as if you’ve raised the money for a wedding then you should be able to raise the money to start a business.

SAM: If you can start a wedding, you can start a business. And on that note, adios.

#36: The Power Of Naivety & The Benefits To Ignorance

 

Sam on the difficulties of making accurate predictions:
“I think that everything I’ve done has been harder than I thought it was going to be. But, if I knew that to begin with, then I probably wouldn’t have gotten involved in the first place.”

Naive optimism is a powerful force and one you should learn to harness. In this episode, we talk about the risks of over-analysing or loose deadlines and the benefits to unreasonable expectations.

Resources Mentioned In This Episode Of The Lazy Entrepreneur Podcast:

Listen to this episode of The Lazy Entrepreneur Podcast on:

iTunes | Spotify | YouTube | Stitcher

Structure

01:08 – You should learn the rules first before you can break them
02:01 – How do you distinguish between when to learn the rules and when to take action
04:24 – Competing at a different angle
06:07 – How Emma and Sam are still learning how to podcast 40+ episodes in
09:05 – Failed endeavors drive future success
12:33 – Sam’s examples of the benefits of naivety from his own businesses (writing a book, starting a blog, starting the table tennis business)
17:54 – Naivety and travel
20:59 – Things always take longer than you think they will
22:20 – Parkinson’s Law: work extends to take up the time we allot for it
28:10 – Work is good for you
32:00 – Naivety helps you get moving more quickly

Transcript

SAM: Hello and welcome back to another episode of the lazy entrepreneur. I’m your host Sam Priestley, and as always we’re joined by my lovely co-host, Emma Priestley.

EMMA: Hello.

SAM: Emma, I thought this subject I’ve got today would be a good podcast to follow up from the last one we did, where we interviewed you about going around to different places in London and going in without any idea of what you were doing and trying to speak to the manager and trying to sell them our gin. Because, what you were doing is you were having a great day just by being naive, and approaching these top restaurants, that, perhaps if you’re following the best practices, you would have been told was a stupid idea.

EMMA: Yeah definitely.

SAM: So that’s what I want to talk about today, the power of naivety and not knowing anything and going in and being a bit oblivious and breaking some of the rules. I thought this would be another good one to do because on Episode 34 about following the crowd, when to follow the crowd and when to do your own thing, I said something along the lines of, you should learn the rules first before you can break them. Or, you should learn the rules so you can break them.

EMMA: Did you?

SAM: Yeah, well that is too simplistic. Because it is true, it is worth learning some of the rules so you can break them. But how do you draw the line of when you’ve learnt enough of the rules? It’s not like you went in there with no idea of the price you’re going to sell it.

EMMA: No.

SAM: It wasn’t like you went in there and you asked the waitress if you could sell her the gin. You weren’t completely naive. You kind of learned the rules, you knew the questions to ask. You went in knowing who their distributors were and you knew the common problems that they might have. But you just didn’t really know the best practices or what the appropriate way is to approach the owner of a posh restaurant.

EMMA: Yeah.

SAM: So I think this is kind of where we want to talk about, like how do you draw the line in between doing loads of research and learning what the rules are and just going for it and being naive and diving straight in. Because it’s very easy to take that learning of the rules too far. In Episode 54 I said learn the rules before you can break them but you can definitely get what’s called analysis paralysis by spending all your time researching and learning the rules and just never actually going for it.

EMMA: Yeah because the more rules you learn, the more it puts you off making the first move.

SAM: Yeah because the more you get told there’s a certain way of doing it, the more scared you get about breaking that certain way. I’ve definitely put off ideas by over researching things and I get contacted by people all the time asking about potential problems that could happen to their business which are so far down the line or so niche that I’m like how do they even know these problems exist in the first place? They just looked into it way too much. A lot of the early podcasts we did, I spoke a lot about just getting started. Just going for it. That ties in with this. But I want to take it a little bit further and talk about it. It’s not just about getting started, there is a benefit to not knowing everything. There is a benefit to being naive. Let’s talk about the benefits of being ignorant and being naive. So I think the main one is that you don’t fall into the trap of thinking there’s only one way of doing things, because to be an entrepreneur you’ve got to be a risk-taker and creative. And trying things that other people haven’t done. And if you just follow the rules, if you learn too much about something you’re going to end up thinking that’s the only way to do it. Whereas if you go in not knowing rules and then breaking them accidentally, you might then accidentally stumble across a better way of doing things.

EMMA: But also there’s reasons behind, for example, having to be creative. So creative with budget, creative with time, doing things a bit differently because ultimately you’re not setting up a huge great big corporate company with lots of staff, lots of investment and lots of time. You’re a startup, you’re trying to do things quickly and therefore you need to be creative.

SAM: Exactly you’re not going to beat those people at their own game. You’re gonna beat a big corporate company with lots of money and lots of employees doing exactly what they do in the exact same way. You’ll lose because they’re the best in the world at that because they’ve spent forever becoming the best in the world. You’ve got to become very good at doing something different or something they can’t do.

EMMA: Yeah.

SAM: And that’s it, you might stumble across a unique approach that works. That works better. So that’s the main reason, the main benefit. But then the most obvious benefit is you just get started quicker. You don’t have to research anything, you can start tomorrow.

EMMA: Yeah start making some money or start putting your ideas into the real world.

SAM: Yes it doesn’t matter how many people you focus group and say, oh do you think you might want to buy this in six months time when it’s ready? The best way to know is going to be stick it in their face and ask if they want to buy it.

EMMA: Yeah I mean a good example of that is the first batch of our gin. We could then test the market to see if customers liked the gin and if they didn’t we could then potentially change the branding, change the recipe. We weren’t locked into selling hundreds of thousands of bottles in the first month.

SAM: Yeah and if people didn’t like it, we wouldn’t have lost any money because pretty much all we put in would have been recuperated by setting that first batch. Yeah the cost of failure when you dive straight into something, provided you do it smartly, isn’t that high. Similar to starting this podcast, before recording this episode, we wandered around the house for about 10 minutes trying to work out the acoustics in different rooms. So I am still trying to work out how to make this podcast sound good. This will be episode number 35 I think, plus bonus episodes. I think this will be the forty second episode I’ve recorded, and I still don’t really know I’m doing. But if I tried to work all this stuff out beforehand, I’d only be getting started now and I think that leads on to the next thing. You’re probably going to underestimate just how hard it is gonna be, whatever it is you’re starting. Robert Rodriguez in his interview on Tim Ferriss, he’s a film director he said something that really stuck with me and that was that it’s not his job to tell you how hard it’s gonna be. You’re gonna find out that yourself along the way. It’s his job just to encourage you to start and I think that like everything I’ve done has been harder than I thought it was going to be but if I knew that to begin with then I probably wouldn’t have gotten involved in the first place.

EMMA: Yeah.

SAM: This is the lazy entrepreneur. Most things I’m doing are because I think they’re gonna be easy.

EMMA: But you that optimism, you need that energy to get things off the ground. The more that you potentially research, the more that you talk to negative people around you, the less likely you are to to actually make the first move and start the business.

SAM: Well that’s it, the other word for cynical negative people are realists. That’s what they say, you know we understand the reality of life. That things are really difficult. Well not many realists have ever created anything amazing. It’s all those naive people who get going, get halfway through everything and think, well I’ve come this far already, I might as well continue.

EMMA: But there’s definitely optimism associated with being naive isn’t there?

SAM: Well I think that’s it. I’m not naive into thinking that things are gonna be really difficult and in fact are really easy. Because that’s not how it works. Things are hard. I’m naive in that I think that I can do something and it’s gonna be easier than it actually is. And that doesn’t mean it’s not worth doing. In fact, the most fulfilling things I’ve done are some of the hardest.

EMMA: Yeah and I think that’s something in being an entrepreneur. You love the challenges and you love the learning opportunities and that’s one of the highlights of setting up an individual business for you.

SAM: And I think then the businesses that I’m most proud of are often the ones that have been harder. So the most profitable business is a table-tennis business where we make table tennis bats and I don’t brag about that at all, I don’t tell people about it that much. I tell people about the gin because I’m more proud of it because I think it was more of an achievement to do.

EMMA: And the coffee shop.

SAM: And the coffee shop which made me no money, but I’m still very proud of it. It was really hard and by doing it I achieved something. Actually that’s another good takeaway because the coffee shop, it didn’t fail but it didn’t make any money so that might as well be a failure. And that’s the other thing about being naive and just starting something. Even if it doesn’t work out, there’s often still value in it having been done.

EMMA: Definitely.

SAM: Or if it hasn’t gone the way you’ve wanted it too, there’s been a gateway into something else .

EMMA: Yeah it could be that you’ve met some new people along the way or potential people you could work with on future projects.

SAM: I’d been thinking about you getting into your marketing work, your freelance marketing work after you quit PwC. So I remember when you were thinking about what you’re gonna do if you quit, so Emma used to work for a big accounting firm PwC in London. She worked in marketing there and I was trying to convince her to quit her job and come traveling with me for indefinitely and create her own business. I remember at the time Emma had always been into food and drink and a few other things and those were my first ideas of stuff I thought that you should do, and the one that you settled on was the freelance marketing and it’s because it was a gateway from something you understood and knew well into this new life.

EMMA: Definitely.

SAM: And so you went off and you did the freelance marketing, you did it for two years or something like that, and then eventually you then transitioned from there into doing stuff actually you’re much more passionate about. Food and drink. But if it wasn’t for the kind of naivety of having this gateway you could go into, oh I’m already good at marketing, I come from a very prestigious firm, it is going to be fairly straightforward for me to get large contracts, you probably wouldn’t have taken that move. Which even though you stopped doing that now, it has led to a totally different and much better life than what you were living before.

EMMA: Yeah.

SAM: And it probably was because I was saying you could definitely make and it was quite straightforward. And then it turned out to be a lot harder and a lot less fun than you expected.

EMMA: It’s interesting, isn’t it? Because really for me going into freelance marketing was to change my life.

SAM: And if you hadn’t have had that option, would you have ever had the confidence to leave a corporate job?

EMMA: No way. Neo I don’t think so and I think the other thing about that is that the people around me at the time before I met you wouldn’t have been supportive of me effectively quitting my corporate job and becoming a freelancer or creating a startup. I wouldn’t have had that network.

SAM: Yeah I think that’s kind of what I’m trying to say, is that their vision for you was probably quite close to reality of what freelance marketing was. That it wasn’t a career ladder like it it probably wouldn’t go that far, it’d be quite hard work to get clients. You’d have to deal with a lot of the hassle that you don’t have to deal with, you go from a very stable income that you were giving up all these things for this thing that probably wasn’t worth that much, but actually that step you took isn’t where you ended up. That is the first step which then led to you making gin or actually doing something you’re much more passionate about and it’s much different.

EMMA: Yeah definitely.

SAM: They’re thinking to themselves, they’re realists, they’re right but that’s because I didn’t see the full picture. Like that first one could have failed completely. You could have spent six months working on it, but it failed but then moved on to something else completely different. It would have worked, but that doesn’t mean the first thing wasn’t worth doing. Because it was a stepping stone out of the thing you were currently in.

EMMA: Yeah so what are some of the examples from your businesses of you in the advantages of being naive?

 

SAM: Good question I actually had written some down but I deleted them all so let me undo that.

EMMA: We just talked about you deleting everything and you’re like, I don’t delete things.

SAM: Oh I’ve got a few. Writing a book. l wrote the expert in a year table tennis book, I was very naive about that. I didn’t think it would be particularly hard. It was really difficult. We went to see a publisher who who told us it wasn’t worth doing and.

EMMA: What the idea wasn’t worth doing.

SAM: The idea was okay but he just told us it was, oh we hadn’t hadn’t done the ABCD you’re meant to do when publishing a book, and all your title is in the passive voice, that’s bad. I didn’t really know what the passive voice was at the time, I still don’t really know. A bunch of other things like who’s your target market? What about this, what about that? We didn’t really have that many answers. He said I don’t think you should continue in this book as it is, maybe write a different book or spend a lot more time changing this book and then you should publish it and we kind of went away from that meeting a bit downtrodden. Because we kind of did a first draft, which took us ages. We spent months and months on this. We kind of walked away and thought what should we do now? Should we spend another six months trying to change it into the book that this expert has told us it should be? Or should we just carry on what we’re doing and do it anyway? And we did speak to a few different publishers about it, but eventually decided we would publish it ourself because we knew we had an audience already who was interested in the subject which was this year playing table tennis and how you learned skills and things like that, who we knew would buy it and we had done a lot more by self-publishing. So that was a bit naive and we launched it and you know, it’s got very good feedback.

EMMA: It’s very personal, it’s written very much from the heart and from the ups and downs of the year.

SAM: Yeah it’s a very niche, weird book but people liked it. It’s got good reviews.

EMMA: How many have you sold?

SAM: Good question. I think about 5,000.

EMMA: So that’s pretty good.

SAM: Yeah well we average about three pound 50, whereas I think if you go down to publishers, you earn about 50 P. So that is something where we were a bit naive. Going in and then we wrote the book and then we were a bit naive about where to go from there. I mean books aren’t a great way to make money because you only earn about three pound 50 from each person and nowadays, when your targets as markets are so small, that’s not really great.

EMMA: No but I think there is something in a book that shows that you are professional to people who don’t know anything about this topic.

SAM: Yeah now we can say that for a year or two years, we’ve been the best selling table tennis book that there is. Not a big market but we are.

EMMA: Which then helps to sell more bats.

SAM: And helps add on quite a bit to our credentials. It has loads of good things about it. I mean starting the blog, that’s a little bit naive, starting the table tennis business was a bit naive.

EMMA: So what was naive about starting the blog?

SAM: I mean that’s probably a less naive one because I didn’t think it was gonna make any money but yeah. Naively optimistic to think that there’s any value to what I have to say. I think that’s like, well most people well you don’t know to write, you studied computer science.

EMMA: You don’t know what you’re talking about.

SAM: You don’t know you’re talking about yeah, and those are all valid points but you know learning to write was one of the reasons I did the blog and I’ve got a lot better at. Actually yesterday so my dad is a retired neuroscientist and he’s writing a children’s book at the moment or a coffee-table book and he’s taken photos of the brain over his 30-year career and he’s got all captions for it and he took it to a publisher and they said, these captions no one can understand, you need to need to translate them into something that’s legible. So he went and spoke to a few friends and all his friends recommended me to help edit that for him. That’s a turnaround from the point where no one would recommend me for anything to do with writing to actually being able to understand something quite complex and turn into something legible.

EMMA: What a compliment. Are you going to do it?

SAM: Yeah I said you can send me anything and I’ll have a look.

EMMA: That’s great.

SAM: Something else naive, I think outside the business was the way we go travelling where we just kind of plonk ourselves down, buy a one-way ticket to a random country, book one night or two nights in the hostel when we arrive and then just work it out from there. Well I included that, so I wrote a blog post in 2017 because on the subject in terms of naivety and choosing ignorance, traveling was something I talked about, how I purposely don’t look up all the safety stuff about a country because it’ll terrify me. And I don’t want to be, do you remember when we went to Rio and we were absolutely terrified and we got there about like 9 p.m.

EMMA: Yeah.

SAM: And we got to the hostel and everyone from the hostel was going out to just have some drinks and just sit by the beach. And so you’re terrified. I remember thinking, is it safe for us to walk out the hostel and go to a shop around the corner then after being there three weeks, we were like, that was ridiculous to be so scared. Because everyone built it up as such a terrifying place.

EMMA: We thought we’re gonna get mugged and eople would tell stories about how everything gets stolen off you including your flip-flops.

SAM: But we didn’t get any of that.

EMMA: It was quite naive of us to go travelling in the first place and to think that we were gonna have a better life.

SAM: That’s true, and why would you think this is going to be a better life.

EMMA: Yeah there was definitely a grass is greener and kind of rose-tinted view of what our day-to-day life was going to be travelling compared to working in London.

SAM: Yeah and moving here yeah after we got a bit bored of travelling and we chose Tunbridge Wells and to live in a house and be adults and all that kind of thing. I mean everything has been great but nothing, no amount of research could have prepared me for what it was and say not doing that much research wouldn’t have made that much benefit. There’s a quote that someone told us, was it a week ago or something that it’s either fun or funny. Even stuff that goes wrong will then produce the stories we’ll tell for another 20, 30 years. The silly, the disasters make the best stories. The favorite episodes you like hearing on this podcast are where I tell a story about some ridiculous idea that we tried to do that just was never gonna work. And was just stupid.

EMMA: Well there are many of those.

SAM: If everything was very serious and made sense. The other thing I’ve been thinking about when it comes to naive optimism is how long everything takes.

EMMA: Yeah can you remember how agitated you where when I was trying to launch the gin?

 

SAM: Yeah well we started working on it in September and I wanted it out by Christmas. How ridiculous is that? Design a recipe, get all the logistics in place, do the branding, get a brand name and launch our own gin.

EMMA: And if you go back and read some of Sam’s monthly reports from that time you’ll see how passive aggressive he was getting. Even in his blog post about how long it was taking.

SAM: Oh yeah I was getting really annoyed at how long it was taking. And then we launched in June or something, but then if we go further back, we look at the episode we did on starting a coffee shop where I went from nothing to opening doors in six months and by that time I was getting really agitated it was taking so long as well, getting really annoyed. And I think about how something like that I would now go into and think it would take us a year and a half to launch.

EMMA: With the coffee shop?

 

SAM: Yeah, I thought if I am going to start a coffee shop it will take about a year.

EMMA: And what about the gin?

SAM: A year and a half. Yeah you got to book in like nine months to get it started, or the table tennis business, when we started selling table tennis bats, we launched our first product in six months from the idea to it being on sale. Now we’re trying to release our third generation and I’ve been working on that for about a year and a half and it’s still not ready to launch.

EMMA: And that’s okay.

SAM: But is that okay? That’s the thing, because is it that being naively optimistic about time means that I’m always frustrated it’s taking long? But it is still quicker then it should be. Have you heard of Parkinson’s Law?

EMMA: No.

SAM: I can’t believe I haven’t talked about Parkinson’s law before, it’s one of my favorite little sayings. The law is that the work expands to fill the time available for completion, so no matter how long you give yourself to do work it’s always gonna take that long.

EMMA: Yeah.

SAM: If I give myself three hours to write a blog post, I’ll take three hours to write a blog post. If I give myself nine hours to write a blog post, I’ll take nine hours to write a blog post. And the difference between the 3 hour and the 9 hour is not going to be that much.

EMMA: Yeah, well I guess I’ve learned that in business is the kind of 80/20 rule that there’s only so much you can do and then all the extra stuff on top, the 20% doesn’t really add anything, but you tend to spend quite a lot of time on it.

SAM: I think there’s more to it than that, but maybe that is it. Maybe that is it yeah I think it right I probably is it. So today we got an unexpected deadline of basically we need to have some advert content done by the end of the day. Now this would normally take us two weeks or more of approving the copy and making sure the images were okay.

EMMA: Taking the photos.

SAM: And we managed to get it done in a day and it was great because we had a time demand and the job took that amount of time because it couldn’t not take that amount of time.

EMMA: Yeah I think if we’d added another two weeks, we wouldn’t have had something that was that different.

SAM: I need a bit more of that naive optimism oh how long stuff is gonna take and that frustration when it isn’t as quick as I want it to be. Now there’s something about being unreasonable that actually gets you some results.

EMMA: Yes, definitely.

SAM: And that can be unreasonable. They talk about people like Steve Jobs, this idea of a reality distortion field around them, where they ask for impossible tasks and people just get it done even though it’s impossible, because they just expect it and then people somehow make it happen. And I think I need to get a bit more of that in what we’re doing these days. I used to have that in that I thought everything would be easy and then I worked on it and it turned out it wasn’t easy but I still managed to do it anyway, even if it took longer than expected. Now, I think everything’s going to be quite hard and I plan out that it is going to be quite hard and my expectations have hit and I’m still annoyed because stuff takes longer than I expect, even though I’ve given myself three times a time limit that I would have done seven or eight years ago.

EMMA: So you’re saying your optimism and your naivety has gone down the older you get?

SAM: I think so yeah. Yeah definitely less naive, more fearful, more lazy. I’m not more lazy. I’m exactly the same lazy that I was. I’m probably less lazy than I used to be. I just now have an appreciation of how hard things are whereas before, I dive into challenges because I didn’t think they’d be that difficult.

EMMA: Yeah I think good example of that is driving.

SAM: Yeah yeah that’s another one I talked about in that blog post from two years ago now. When I first started driving, when you first start driving at 17 you had all the confidence in the world. Never worried about breaking down or anything like that and then after University, moved to London and went travelling, so had a six year period without driving and then when we moved here, we got a car and we were both a bit worried about driving and still are to some extent I’m still a bit more timid than I used to be. You think about things, you get anxious. You say what happens if I break down on the way, I’m gonna be late for this, what happens if my phone runs out of signal when I’m halfway there? What happens when the sat stops working, blah blah blah blah blah. What happens when someone hits me and I’m late for this talk I’m giving or whatever it is. You just think of all this stuff where there’s not really much value in thinking about it.

EMMA: So do you think you should be more optimistic and positive. Do you think you’re going the wrong way?

SAM: Yeah well.

EMMA: Or do you think there’s benefit to being slightly less naive and optimistic? Because you’re a bit more of a realist.

SAM: The benefit is everything a safer, more stable, more comfortable, but I am starting to think comfort is overrated. I need a bit more funny in my life.

EMMA: Yeah I mean that could summarize why are we going travelling again.

SAM: Yeah because we’re planning on going travelling again in July, complete change of life again.

EMMA: We’ve got very comfortable.

SAM: Let’s get back to grotty flats with cockroaches.

EMMA: Meeting new people, new challenges, and being more creative. Pushing us out of our comfort zone.

SAM: And with our businesses, you know a podcast is a very safe business.

EMMA: It is very stable.

SAM: It is just me chatting to you.

EMMA: Yes whereas some of those businesses that you listed out in your new year’s podcast about the kind four or five businesses you wanted to do in 2019, a lot of those were very risky.

SAM: I mean in some ways doing a podcast you got to be a little naive, you could say the market is saturated, there’s too many podcasts out there. At the same time there’s not really any downside to doing a podcast. Whereas these other ones, there is the downside if it doesn’t really work out. This is the other thing, as long as you’re not spending lots of money and going into loads of debt, what is the downside to spending a lot of time and energy and passion on a business? There isn’t really one. You’re learning things, I believe that work is good for you, and if you’re working on something you’re interested and passionate about, it’s very healthy even if it doesn’t work out. The problem is if you end up in a position where you’ve got loads of responsibilities both financially and to other people. Promises that you can’t or don’t feel ethical to get out of that, you just can’t deliver that you’ve overextended yourself. That’s where the problems come, but as long as you keep that on your side, I think go for it. Take wild optimistic swipes at ideas and projects that are ridiculous.

EMMA: So on that, do you have any tips or tricks to you make people a bit more optimistic and bit more naive in their business decisions?

SAM: Ha ha! I think a lot of it is down to just getting started. Hear it from me that doing loads of extra research isn’t gonna benefit you that much at all. There is a certain amount that’s worth doing, as I said in the last podcast, which is worth listening. No, two podcasts ago, the one about following the crowd or taking your own way. You do need to do some research, you do need to know a bit. I’m not saying go in with your eyes completely closed, but I’m saying that there are diminishing returns from research and learning the rules and then there is a point where knowing too much is actually bad to you, will hinder you.

EMMA: And then what about surrounding yourself with people that are optimistic and will encourage you when potentially things fail by being naive.

SAM: Yeah definitely. If you can surround yourself with people who encourage you and motivate you and are optimistic, as well as people who are wise and can help you out and can then see if you’re going too far, if you’re entering that phase where it becomes unhealthy or you’re overextending yourself in terms of financially or in terms of your responsibilities.

EMMA: Or your health.

SAM: Yeah that’s important. I think there is you know you know when people moved to London or to Silicon Valley at 20 or 21 and live in a flat share with 17 other people, have no money and eat noodles, there is value to that, just being around other like-minded people.

EMMA: Yes.

SAM: Getting out of where you are, that hunger, but having nothing means you’ve also got nothing to lose which there is some nobility, there is some benefit to that. If you can, do it. I mean, you don’t need to. If you’re in a place where there is anyone who is like you, I’m not saying leave your family and move somewhere else, but if that’s something you could do then why not? Why not go hunt out other people thinking the same way, go hang out in the working co-working spaces or in the Google cafes where other people are starting their own things up.

EMMA: I mean that’s again one of the key reasons that we are going traveling as well again so that we can meet more like-minded people on a day to day basis. Rather than be the unusual people in Tunbridge Wells that are working for ourselves, working at home, working on lots of different businesses.

SAM: Yeah, so there’s a fair few entrepreneurs in Tunbridge Wells, but there aren’t many digital entrepreneurs. Which is something we’d love to have more.

EMMA: Teah we’d like to socialize with, we’d like to swap ideas with.

SAM: Well on that note, so hopefully this will be a little call to action for us and also for anyone listening. There is power naivety, there is a load of benefits from ignorance basically. You know don’t fall into the trap of thinking there is only one way of doing things. You might stumble across a unique approach that works, a creative way of doing, something that hopefully stands out from the competition of everyone else doing the same thing. You can also get started much faster if you’re naive and you just dive straight in and you’re going to get going. Then as you get going, you’re going to realize just how hard it is, but that’s okay. You want to learn that when you’re already halfway through and you’re not going to quit, rather then before you started and decided never to start in the first place. And finally, even if what you’re doing doesn’t work out, it’s probably still worthwhile and you’re going to learn a lot from it. And it gets you started on a road to doing things a little bit different, doing it a bit creatively. Doing things entrepreneurially. Nowon that note, thanks for listening. Sorry it’s been a few episodes, a week and a half since the last episode. I’ve been quite ill and haven’t really been able to do anything.

EMMA: And it’s also been your 30th birthday.

SAM: And it’s been my 30th birthday which was awesome, and we launched our new gin so if you fancy.

EMMA: You’ve done quite a lot in a week and a half.

SAM: Quite a lot in a week and a half, I think I clocked up 69 hours of ill time in the last week that I would have been doing something productive, but hopefully we’re back on track now. We’ll aim to keep doing two episodes a week, and thanks for your support. If you got any feedback, email me at hello@sampriestley.com

#35: Our Experience Selling Products To Restaurants & Bars

Listen to this episode of The Lazy Entrepreneur Podcast on:

iTunes | Spotify | YouTube | Stitcher

Structure

01:18 – Emma’s approach to making sales
04:30 – Places that could buy directly from Pipehouse Gin
06:30 – Selling in Kent compared to London
10:12 – Sam’s interpretation of Emma’s approach to selling gin
11:20 – Emma’s free bar crawl
12:40 – Pipehouse Gin’s involvement with a Michelin star restaurant
14:28 – The benefits of going out in person rather than hiding behind emails
16:07 – When ignorance works in your favor
19:47 – Emma on being recognized by fans

Transcript

SAM: Hello and welcome back to another episode of the lazy entrepreneur, I’m your host Sam Priestley and as normal we’re joined by my lovely co-host Emma Priestley.

EMMA: Hello.

SAM: Today I actually wanted to interview you so instead of just having to listen to me drone on while you try and keep me on track, we’re now going to have a bit of a role reversal, reason why I would have thought this would be a good episode is because you’ve been doing quite a lot of what is effectively door-to-door selling. You’ve been going from bar to bar, restaurant to restaurant which kind of culminated in this day on Tuesday you had two days ago. We went around to some of the best bars and restaurants in London, trying to sell our new gin. So short backstory is that we own a gin brand together called Pipehouse Gin and coming out next week on the 30th of March, we’ve got a new flavor coming out. We’ve got pink grapefruit and thyme gin and so you’ve been going around to some of the best restaurants in London, the best bars trying to tell them about our gin and trying to sell to them which sounds pretty terrifying to me but you’ve been loving it and it’s also worked in well with your sort of bigger greater plans, so yeah let’s talk about that. It was a bit of a gamble really, you didn’t really warm up or prep them, you just went in and asked for the bar manager.

EMMA: I didn’t even do that.

SAM: So what did you do?

EMMA: First of all I created a list of places I thought I should go to and that list started with brands that I thought had a really English kind of focus so we’re a very English brand, we’re based in Kent, our flavorings are quite English so I thought it would work quite well and then I also asked people within the industry so we know someone that’s got a beer brand for example. For recommendations of places that probably could buy from us direct rather than buy from big distributors. I literally walked up to these places, got a seat at the bar, I asked for the menu and ordered a cocktail. And I sat there and chatted with the bar team and introduced our gin very like softly and then I gave them a sample of our gin which I had in my bag and started the conversation as a customer and then ended it as a potential supplier.

SAM: Oh how did it go?

EMMA: Really well. I was quite nervous for the first one actually planned to go to a restaurant that was on the way to somewhere I had lunch booking and I got too scared to go through that one on the way to the lunch so I in my head I thought I’m going to have lunch first and then I’m going to do it, so that’s how scared I was. Which is funny because I’ve been in probably hundreds of bars and restaurants now within Kent to introduce our gin so is it’s not something that haven’t got experience in but it’s still quite intimidating. I’m a big foodie so some of the places I went to, I really respect and think they’re really good so part of me thought, “Who am I going into one of my favorite restaurants asking them to stock our gin” but at the same time that made it really exciting because the opportunity there was one of my favorite restaurants could stock our gin, so the first one I went into yeah as I said, sat at the bar. It was very quiet. I went so it’s Tuesday afternoon after lunch which is a really good time to go in so after two p.m. before the dinner service so it’s quite quiet which meant I was the only one sat at the bar and the bar team didn’t have loads of drinks orders to do so it meant that they could make my cocktail and they could chat to me which was perfect so I found out how this first restaurant could purchase alcohol. They use six different distributors. None of them I’d heard of so I could make a note of all of those and then the bar staff tried our gin and gave me feedback, which was great and then they also gave me loads of tips of other bars in the area that they thought would be a good fit for the flavor of our gin as well as the brand.

SAM: Awesome, so you mentioned before and we talked on previous podcast that you’re looking for places you thought could buy from us directly. What do you mean by that?

EMMA: So typically bars and restaurants in the UK have big contracts with companies well with distributors basically it means that every week they’ll get a delivery of all of their drinks from one company and that will be soft drink spirits beer everything so it makes it very simple for the bar staff to order and it’s very simple to receive that delivery and then restock versus some bars and restaurants buy directly from drinks retailers. So a craft beer or a specific local soft drink so for us as a small gin company, we look for bars and restaurants that can buy from us directly.

SAM: So there’s two things there on there. One is they’ll have contracts with certain places which when he said they’re not actually allowed to buy from anyone else and they will have got a deal well if you can give them some money or some of the bar fixtures and fittings whatever have been paid for by that distributor and then the other one is a convenience thing if they don’t want to have hundreds of different suppliers that they order for every week. They want to just order in one or two places, and if you’ve been following our Pipehouse Gin journey then you’ll know that this distribution issue is one that we’ve had quite a lot of trouble with. This was really our first time sort of changing tactics slightly and one of the ideas was that a lot of these high-end restaurants, which really care about the provenance and having craft ingredients and craft drinks are also going to be more likely to want to take that extra bit of effort and order from us directly.

EMMA: Definitely.

SAM: Was that kind of what you you got the impression? Because how did it really compare then going around London to all these top restaurants that you were quite scared to go to and you knew Bob Lee and by name type thing for following on Instagram or whatever versus going around in Kent.

EMMA: So it was very different culturally so walking into bars in London the bar staff was just so welcoming and this level of service is amazing so I’ve got a lot of one-on-one conversations. They kind of dedicate time to you and they see there’s a value in them learning about new products whereas going into places around Kent, it’s all about the fact that we’re a local gin.

SAM: So for them really what they care more about was our USP, the whole flavor without the sweetness, London Dry but no added sugar.

EMMA: Yeah and I had a few conversations with bar staff, specifically around that so they’re all very much purist cocktail lovers. Like they love like a martini or a negroni where it’s pretty much all alcohol, pretty much no mixers. They’re the classic cocktails so they really hate the flavored gin market because predominantly most flavor gins are very sweet and they’re a bit more like a liqueur rather than gin but they’re really popular. A lot of their customers ask for pink gin, they don’t even ask for the brand so as bar staff, they really liked the concept of our business and the USB and they all said to me, I haven’t seen this idea of a flavored gin without the sweetness anywhere else. But we can see where it really fits into the market. That was really nice to get that validation.

SAM: That’s something we haven’t really got here have we.

EMMA: Definitely not because it’s just not the same level and I think the customers in London have very different expectations of their cocktail bars and their restaurants compared to the customers in Kent and I think that’s okay and again that kind of feeds in why I was so nervous because I knew it was gonna be a step.

SAM: Well then you couldn’t fall back on like oh we’re based just around the corner.

EMMA: Exactly which is what I’ve talked a lot about like around in Ken and it works really well around Kent.

SAM: I suppose you start to worry that that is the only reason they’re buying from you, that they’re are not buying into the concept.

EMMA: Yeah I’ll tell you something really funny. One of the bar staff, actually the first place I went to said he hates pink gin so much that one time a customer asked for pink gin which they do not stock in this restaurant and he gave them a London Dry Gin with tonic and he put some bitters in it, a particular type of bitters that changes the color to pink and of course the taste because if you know anything about cocktails and bitters, it’s obviously it’s bitter or sour or it’s quite strong. There’s no sugar in bitters. It’s a bit like the equivalent of putting like Worcestershire sauce in your spaghetti, it’s that kind of zinger flavor so that the bar staff were like they’re very purist basically. But also willing to play around and there were a few anecdotes like that from other places where the bar team got really frustrated with customers asking for specific gins and thinking they knew a lot about the gin market and the flavor of gins and in reality they didn’t know anything. Things like that was quite interesting to get those anecdotes and a little insight into the gin market from professionals in London. So that was really interesting for me.

SAM: One of the other reasons I was most excited about you doing this trip was, for a lot of people this sounds like their idea of a terrible day. Going in cold to random bars trying to strike up conversations and somehow subtly bring in

EMMA: The sales element.

SAM: But you know we talked other podcasts about this before. Your sort of long-term goal is not just around the gin but is around sort of food and drink. And all the restaurants you into are ones that you really like and that you would love to actually work with and get to know them a bit better. And they’re places you go to in your free time anyway, and so here you’ve had an excuse, you’ve also had an excuse to talk to the people and they’ll they recognize you now they know you know you and you can follow each other on Instagram and so it builds your personal brand and helps you get little ins into these places which otherwise might not be able to as well as getting our gin into some pretty awesome spots.

EMMA: Yeah which is great for our brand.

SAM: Yeah that’s the thing we didn’t really mention. The reason we’re going to so much effort is because we want our brand linked with these very well-known places, even though it’s not really worth the money, you know you’re going in, you’re buying a cocktail and that cocktails probably going to be more than our margin on the bottle of gin that we sell to them.

EMMA: Well I kept thinking about that and of course everything I drank was free.

SAM: Well that’s even better.

EMMA: Yeah I tried to pay for each cocktail I had at the bar and every time the bar staff said there is no bill. It was fantastic.

SAM: Basically got a free bar crawl around all the best restaurants and bars in London.

EMMA: It was absolutely amazing. I loved it, it was such a good time.

SAM: And you had a great day didn’t you?

EMMA: I did.

SAM: I think it’s really cool it would be interesting to see what comes of it. Would any of these relationships continue? Because around here is that we didn’t really know any of the business side of restaurants and bars and stuff even though we were eating and drinking there a lot but as soon as you start introducing yourself and talking and now you got a reason to and tell them about the gin and once they start stalking us they’ve got a bit of a buy in there. Suddenly we’re friends with so many of these awesome people we never would have otherwise met.

EMMA: Yeah and there’s a whole different side to the industry. We can be involved in creating menus and talking about new products and events that these bars and restaurants do locally like we love all that side and we would never even have those conversations with the restaurant and bar owners if again we hadn’t introduced ourselves as gin owners.

SAM: Yeah because the reason we’re doing this is because we want to and they’re fun. What’s more fun than making gin? Like tomorrow we got a very serious meeting where we’re going to a michelin star restaurant who’s been designing a new cocktail you seen our gin so try it out, how cool is that?

EMMA: It’s amazing.

SAM: And you’ve done a few days where you go around with a few of the distributors who you work with and their sales reps and it’s just like a piss-up, you just do a bar crawl around all these places, they’re all very soft salesy where they go in, order a few drinks.

EMMA: Sit at the bar, have a chat.

SAM: They’re all expenses so you’ll get all them for free and then just get to know them all. That’s pretty cool and it’s completely different because the other reason I want to talk about this is if you watch something like The Apprentice, you get some impression that you can just walk into anywhere, sell them some tap and they’ll buy it. And when you watch it, you’re like there’s no way you could walk into a shop like that, actually buy something off the street. It’s not quite that simple and it does take a little bit more relationship building but that’s exactly what you’ve been doing. You’ve been going in, turn them about that, giving them a sample or two. Following up a week later, going back in another time and your hit rate of places you go into and actually end up stalking us is really good.

EMMA: Yeah definitely, it’s all about building a relationship and then that’s the thing, like the way I could have played in London is I could have done loads of online research of who the restaurant managers and the bar managers are. I could have emailed them and called them to get a meeting and then I could have used that day on Tuesday to meet with them back to back and I did actually see some people doing that. So one of the last restaurant stroke hotel, stroke bars I was in, there was actually a beer tasting going on next to me so it was a very it’s quite a big bar so I could kind of see what was going on, kind of opposite me. And this guy, the sales guy had kind of five or six different beers, different glasses and he was given this spiel and it was quite interesting for me to hear what he was saying but also how he was coming across, how he displayed his products and he had a meeting with some different staff members who I didn’t interact with but what I was doing was I sat at the bar ordering a drink and I was talking with the bar manager so I got the attention of the most important person, and the person that had booked this beer meeting was talking to someone else who probably isn’t necessarily working behind the bar, isn’t really involved in the day-to-day stuff. Maybe he was like an Operations Manager, but so it was quite interesting that I was trying to approach it a bit differently.

SAM: Well especially when the person who’s going to be recommending what gin the customer buys is the guy at the bar.

EMMA: Exactly.

SAM: Especially when they have like 20 different gins, all of which are premium, so sort of which will be in a similar price range to us.

EMMA: You want them to recommend you. It made me think like you know you talked a lot about in business that sometimes it’s not always about you doing loads of research and you’re doing it the right way, the way that everyone else does it but being a bit naive, not knowing too much about the protocol in the industry. Just turning up at the bar and getting a really good chat with the bar manager is actually really good.

SAM: Definitely because the right way is what everyone else is doing it and there are so many sales reps whose job it is just to go around and try and get in with places and they’re all doing the same thing. It seemed coming along and doing a bit differently, the other thing I remember is when you started it took awhile for you to realize actually telling them that you are the owner of the business because they just assumed you were sales rep so while they were nice and friendly is that’s a very different to tell them actually this is my business and my brand.

EMMA: Yeah definitely and it’s funny because it took me quite a while to realize that I didn’t think it needed to be said, but I kept getting these comments, like oh what pay structure are you working tomorrow? And things like that and I was like why they are asking me those questions and then it hit me, they don’t assume that I’m the owner, they assume I’m a paid sales rep.

SAM: Yeah that was probably because they hardly ever had the actual owner coming in. I was like is it an age thing, is it a gender thing but I was like no they just never have the owners take the time themselves to come in and talk about it.

EMMA: Yeah and it’s a bit like, I mean I’m a big fan of going to like food markets and food festivals where you go to different stands and you talk to the business owner that’s created this street food or this new drink and it’s just such a nice experience to go to lots of stands and hear from the business owner how passionate they are about the product and that’s always stuck with me that’s something that I would love to recreate one day and I feel that I am really doing that with the gin.

SAM: Also you’ve got your ear to the ground so you will recognize the owner and most of the market so you’re actually making the food itself so you get really really excited.

EMMA: And it’s quite funny because that’s happened to me quite a lot at taste of London events where there will be the format of taste of London is that they have lots of restaurants that would do pop-up restaurants. Basically you can order a few small dishes and it’s Street food and it’s a way of trying their food particularly if they’re Michelin star at a very cheap price but what’s funny is the people that are serving aren’t obviously the head chef but I know what exactly as you said I know what the head chef looks like and it’s been a few times where I’ve actually just gone up to the head chef who’s standing by the stand and be like, “Ah, it’s so nice to meet you!” and like have a proper chat and everyone’s looking at me like does she know something we don’t? Yeah I found that very funny.

SAM: Yeah I remember we went to a foodie event around here a few months ago and the people we were with who were similar to you can be like, oh that’s that person and I have no idea who they’re talking about.

EMMA: Well yeah obviously because Sam has no facial recognition so he wouldn’t know anyone.

SAM: And all these famous chefs who weren’t actually doing the cooking, they’re kind of overseeing things. They weren’t doing the cooking but they were just wandering around I wonder if they’ll ever be people we actually met, we’ve had a couple of times when we do market stalls and people will recognize us and come up and chat to us because they’ve seen us on social media or they followed a blog or something like that.

EMMA: Well I’m starting to get it more and more like the last time I had it, I was in a bar in Tunbridge Wells and I was talking I was about having a meeting with someone over a cocktail about the gin and someone came up to me and said, well yeah they were like basically fangirling me. Like interrupting that conversation to just be like, I’m so happy to meet you and I was like this is really weird. But I’ve had it a few times locally outside of doing the events.

SAM: I think because part of it is that you put these people on such a pedestal that you know a bit about them and you never think, you’re like fraud’s in comparison. Alright well I hoped that was an interesting episode, just something a bit different. I think the main takeaway is that for Emma this is something where she has multiple goals from all this sort of stuff, and it’s not that she’s doing this because she just wants to sell lots of gin, it’s because she really enjoys going to these places, she wants to get a bit more known in industry. She wants to be able to up her food and drink credentials. All this kind of stuff which could then lead to maybe a completely different career later down the line something else she’s passionate about but it’s whole building her expertise and credentials in this sort of London food and drink scene yeah as well as Sarah najin yeah which is great.

EMMA: And because I’m so into food and drink I know both locally and in London where are the places we should be stocked in.

SAM: The other final thing to say was a couple of places you went to where stuff, there’s like a three month waiting list to go for dinner. You’re able to just turn up, get a drink at a random time because it’s part of your job and you’re talking to the key people in the restaurant.

EMMA: Absolutely amazing, I thought I was in heaven. This particular restaurant I wanted to go to since the day I opened, and I just walked in and went to the bar.

SAM: And got it all for free.

EMMA: And the service was amazing! I think the takeaway from that is don’t be too intimidated. Just because you hold something really highly and you think it’s like way above you, the reality is that these bar staff really want to hear about new drinks and they get something out of replies coming in and telling them about what’s going on in the industry as well.

SAM: Another thing is that a lot of these people probably have the goal at one point of maybe going off and doing a similar thing to what we’ve done yeah.

EMMA: That’s interesting to say that because some of the bar stuff I did ask, “Have you ever thought about creating your own drinks business?” because some people were really knowledgeable about the industry to me and I was thinking well you obviously know where their gap in the market is but they’d all say they all said no for different reasons which was interesting.

SAM: When you go back they’ll have a few more questions for you, Oh Emma I’ve been thinking.

EMMA: Maybe.

SAM: Well let’s leave it up, thank you for being my interviewee today and yeah new gin coming out will be out on the 30th pink grapefruit, in time it’s delicious.You can buy it on Amazon or through our website.

EMMA: Yeah and in all good restaurants and bars.

SAM: If they don’t sell it, they’re not good! Goodbye.

#34: Should We Follow The Crowd Or Do The Opposite?

Sam on pivotal life-defining decisions:
“It’s the times when I’ve gone against common wisdom and do the opposite of what everyone thinks I should do that have most defined my life and made me the person that I am today.”

The wisdom of the crowd is well understood and copying what everyone else is doing is normally the correct option. But it is the times when we do the opposite that most defines us. And it is where success is made. In this episode, we talk about when you should follow the crowd and when you should do the opposite.

Resources Mentioned In This Episode Of The Lazy Entrepreneur Podcast:

Listen to this episode of The Lazy Entrepreneur Podcast on:

iTunes | Spotify | YouTube | Stitcher

Structure

01:37 – Introductions
04:00 – Knowledge of the market vs. contrarian decisions
05:50 – “Be greedy when others are fearful and fearful when others are greedy” – Warren Buffet
07:06 – Phone a friend vs. ask the audience
08:12 – How to know when to follow the crowd and when to do your own thing?
08:32 – Questions to ask yourself
10:50 – How sam did the opposite when writing blog posts
13:42 – How Emma decided to go into marketing

Transcript

SAM: Hello and welcome back to another episode of the lazy entrepreneur. I’m your host Sam Priestly and as normal we’re joined by my lovely co-host Emma Priestly.

EMMA: Hello.

SAM: Hello we’ve got quite a few new listeners recently, it’s peaking in a few of the charts. In fact today I got quite a few emails from other podcasters asking if they can come on.

EMMA: How exciting.

SAM: It’s very funny because none of them name the name of the podcast, they’re all just these obviously stock emails that are just like, I love your content, blah blah blah is an expert in this and he thinks the same thing as you. Can he come on your podcast? It’s very funny, I’ve got literally about four or five today.

EMMA: But it doesn’t say anything about what they specialize in.

SAM: What it says about them but doesn’t say, oh I like listening to the lazy entrepreneur podcast, I really enjoyed this episode. There’s no kind of personalization to it.

EMMA: Do any of them sound like they’ve got something interesting to say?

SAM: Well I’m not particular interested in having them on but I’m quite interested in is the publicity companies who’ve emailed me off it. So they’ve obviously got the name and the company they hired to do it so I’m going to drop some of them an email, see what their rates are, see if they can get me a bit of publicity. But I thought this would be a good opportunity to kind of explain what it is we’re doing here because there’s probably some listeners who’ve got no idea what’s going on.

EMMA: That’s good. Well I’m Sam Priestley and I run a blog called Sam Priestley dot com. This is the lazy entrepreneur podcaster. The lazy entrepreneur is me becauseI’m very lazy. It’s just our chatting, we’re married, I like talking about entrepreneurial stuff. I like finding sort of shortcut ways to do things. I have quite a lot of experience starting loads of businesses. I’m quite lazy and I find it hard to motivate myself so one of the things I do is I’m always changing to new projects and new businesses. I also kind of got this idea that there’s a certain amount of money that after that amount, I don’t need to really own anymore. So the projects I look for are ones that I actually enjoy doing and lead to a better life. We spent a year and a half traveling full-time while working online and kind of doing our thing. Together we run a gin company, it’s called pipe house gin and we make sort of flavored gins, so flavor without the sweetness. I’ve got a table tennis brand. Emma run supper clubs she hosts people at our house and cooks for them and charges them a fee, and we do all sorts of other things don’t we. We do a bit of marketing I remember. Feel free to look at other podcast episodes, there’s all sorts of stuff. I once started a coffee shops, there’s an episode on that, I once had a car importing and exporting business, there’s an episode on that. I used to be a professional gambler, there’s all sorts of random stuff I just like talking about so it’s just us chatting really. And today we’re going to talk about something that I’ve been thinking about quite a lot recently, so Emma you know I am a massive hypocrite?

EMMA: In what way.

SAM: And I am in some ways a walking contradiction, so I’ve got these two ideas that I wholeheartedly believe to be true. One of which is that the crowd is normally right, that there’s wisdom to the crowd that what most people are doing is correct. Then I’ve also got this idea that the crowd is an idiot and that most of the stuff they do, there’s no logic behind it and we should be doing the opposite.

EMMA: It’s just following like sheep

SAM: And people don’t really think through a lot of the reasons they do stuff. And so it’s quite a lot because I believe both of those. So the last episode that was released was on value betting where I literally made a career out of betting against anyone who didn’t follow the crowd, that was how I discovered value bets, so anyone who disagreed with what the crowd thought was wrong and just made money by betting against them so that’s a time where I believe so much in the wisdom of the crowd and the efficiency of the marketplace and all this kind of stuff that I’m willing to bet loads of money on that. But then when it comes to, you know, getting a job or buying a house or even your idea that you can make money at gambling, that’s all very like anti common wisdom. And the opposite of the crowd, the opposite of what most people believe and I’ve been thinking that it’s the times when I’ve gone against common wisdom and do the opposite of what everyone thinks I should do that have most defined my life and made me the person that I am today.

EMMA: Yeah definitely it’s making me think of two businesses: table tennis bats and gin because I think in that way they’re opposites. So table tennis bats was a business you set up which wasn’t following the crowd. It was starting everything from scratch and then gin is a very saturated market.

SAM: Even with the gin, our idea was to do something that no one else was really doing, which was to focus on the online side of it.

EMMA: Even within something that sounds like it’s following the craze, the gin craze, that you’ve always got this edge of trying to do differently.

SAM: And while we are following this gin craze, everybody tells us we shouldn’t be making gin and when we started it was a stupid idea as a saturated market, you’ll never be able to make it work so thecommon wisdom there is that what you shouldn’t do it that’s too busy.

EMMA: It’s too crowded.

SAM: Whenever you tell someone I make gin, they go oh that’s a very on-trend market and you can tell what they’re thinking, that you’re only doing that because you’re following everyone else.

EMMA: You’re being a sheep.

SAM: Yeah you’re never gonna make any money on that. Yeah there’s a quite famous quote from Warren Buffett where he says, “be fearful when others are greedy and greedy when others are fearful.” I remember I read that maybe when I was 18 something. At the time I was also reading a book called The Black Swan by Nassim Taleb which was pretty much saying the same thing, that people underestimate the chances of unlikely events, and I thought I found an easy way to make money. I’ll just take the opposite where everyone else did so I wrote a little computer program that would go on the stock market and do the opposite of what everyone else was doing that when the market was going up I would sell, when the market was going down I would buy.

EMMA: What happened?

SAM: Well I lost money, it’s just too simplistic an idea because crowd is normally right.

EMMA: But that’s how it started that mentality.

SAM: Have you watched who wants to be a millionaire?

EMMA: I watched it the other day with you.

 

SAM: Oh yeah when the teacher won. Yeah and there’s there’s free lifelines, yeah a 50-50 call a friend or ask the audience and the audience always gets the right answer because there’s that wisdom to crowd the Smurfs it’s a really hard question, it always seems to get the right answer and like if you’re walking down the street and suddenly everyone starts running the other way screaming you should probably start running too, like following the crowd is a survival mechanism and you don’t go that far wrong just by following the crowd. Then you can take it too far, this is the lazy entrepreneur podcast, let’s talk a little bit about it in entrepreneurship. And I think an area where I think people want to follow a crowd a bit too much is when it comes to starting a business. They do an online course on how to start a business what they’ll do is someone will have found the little way to make money from drop shipping or retail arbitrage or Amazon FBA or whatever it is yeah, they’ll then write down exactly what they did they’ll turn it into a recipe and then they’ll sell it on to hundreds of people. But then as soon as anyone else is doing it, it doesn’t make sense anymore. So how do you know when to follow the crowd or when to do your own thing?

EMMA: I don’t know if it is gut feel or is it a lot of research? Is it a bit of both?

SAM: Yeah it’s probably research. I think it’s probably also asking why, like being curious like why do people think that? Have a look at stuff that we take for granted and asking.

EMMA: Give an example of that?

SAM: Why go to university? Why own a house? Why should I want to become a millionaire? Why should I try and succeed in the career I’m currently in? Why should I retire at 65? Why should I have intro music in this podcast? Why can’t I make money gambling? Why shouldn’t I start a gin business? Why can’t I have an ice cream for a starter rather than in the desert?

EMMA: We have an insight into your brain.

SAM: I think the thing is that most of these things, the answer is well there’s good reasons why all this happens, but then occasionally you’ll think about something and you’ll go oh, well maybe that isn’t. Maybe that route isn’t the right thing for me. Often people ask me why don’t we own the house we live in, why do we rent? And most people I don’t think have ever considered that maybe owning isn’t the right option?

EMMA: Yeah I agree with that.

SAM: They just assume, what should I be doing? Well I should I buy a house? They don’t think why should I buy a house and literally we’ve got a few friends who bought a house a few years ago and are now moving. For them buying a house and then selling it three years later and moving is a bad decision, but they never thought of it like that, they’ve never considered it. I don’t think buying a house is the wrong thing, I am just saying most people don’t consider that it could be a bad decision. Like go into that much debt, spending that much money on a home. I have this idea it’s kind of good to learn the rules of something. Understand why they’re doing it and then you can break the rules.

EMMA: Yeah they’re going in knowingly rather than ignorantly.

SAM: When I started writing my blog the best practices you should write two or three posts a week, the more posts you write, the better. Each post should be under a thousand words because everyone has a short attention span so people, yeah they need to be short and snappy. You should write less like top ten of whatever. There’s all this kind of stuff that I read and knew that was the wisdom.

EMMA: That’s given me proper flashbacks to professional serviceS marketing. It’s complete rubbish.

SAM: Well and I did the exact opposite on purpose. I wrote like one or two posts a month. Each post was really in depth and I haven’t done a single clickbait article and it’s worked out for me and it’s only worked out for me because I have done the opposite. If I had followed the field I don’t think it would have worked.

EMMA: But do you think that’s because it stood out to your readers.

SAM: Well it’s a unique it’s different it’s not like what else everyone’s reading and I actually have stuff that I can say that they might not have heard. When I did an in-depth series on how to start a gin business, that’s not something you can cover in a thousand words.

EMMA: Barely skim the surface.

SAM: Yeah I think that there is a little call to action that is the reason I’m doing this episode, what I want to talk about it is that I think we should take a step back and think about the stuff that we do every day you know the long term goals we have and have a think about why exactly are we doing them. Like why we are in the careers we are in, why we are in the businesses we are doing, why are we living in the towns we’re in, why are we doing the hobbies that we’re doing and just asking it why? Are we just doing it because that’s the natural route or is it another reason, have we actually thought about it. The other thing I was thinking in one of the recent podcasts we listen to, you say one of the reasons you got into professional services originally so Emma used to work at a big company in London called PwC and one the reasons you got into it was that you’d been giving you advice that if you wanted to get into charity work later down the line, it’d be good to have this background in professional services and work in the city.

EMMA: So I made that up, that was my impression. was never told that, I’d never felt comfortable going into charity sector with my sociology degree. I didn’t feel that I had any skills I could offer a charity whether it was an admin based role starting at the bottom all the way through to a technical role for example, being their accountant. I thought I needed to go and get experience somewhere else, potentially in a big company. Then what to do, what not to do and then take that experience to a charity.

SAM: So there’s something you’ve actually thought about. That is probably the right thing to do because I wondering like was that was that just what you were taught in your course? That if you wanted to do that you should go that route, just do ABC and then end up at C.

EMMA: Bring that up in this podcast because the reason I came to that conclusion was talking to all of my course friends when we were graduating and what jobs they were going on to do and there was no way they were all going to charities and every time I spoke to someone about it, what are you gonna offer that charity? You’re not offering any value and you’re going in at graduate salary, so all this money that this charity has raised for your annual income, it just it felt very uncomfortable to me. And I felt that I’d be much better valued going in and offering a set of skills, once I’d got experience somewhere else.

SAM: I think those are the sort of decisions you need to constantly be rechecking you made your decision when you were 20 or 21 when you’re looking to graduate university. Then when you’re 24 25 you relook at that and say was I correct in my assumptions? Is this actually, am I learning skills that will help or is there a better route?

EMMA: Or will I change my mind, is charity not actually the goal?

 

SAM: Or do you actually just want to hang out with me and record stupid podcasts and drinking lots of gin.

EMMA: Yeah and do loads of cooking and eat lots of nice food.

SAM: Yeah that’s really all I had to say, I was thinking about this but we don’t know the answer you know I wholeheartedly believe that generally the crowd is correct in common wisdom is common wisdom for a reason. I also believe that the stuff that defines us and the real success comes from when we break away from the common wisdom and we do our own thing when we take a unique route that’s counter cultural or counter to what everyone else has too much to do. How do you know when to make that stand. I think you can’t just be contrarian you cannot be the devil’s advocate of everything you’re doing and do the opposite people, because the crowds normally right but I think if you take a step back and you really think about why you’re doing certain things why are you following a common wisdom, that’s when you’ll see these opportunities and these kind of big changes to your life that maybe are the right thing to do. Because you know some things are pretty important, like what career you go into, what you do with your time? What hobbies you do.

EMMA: Definitely.

SAM: Yeah so have a think. Well thanks for listening. How long have we gone on? There we go so it’s a short one that’s what I wanted, we had done two quite long ones recently I wanted to bring it back a little bit a little short one, so food for thought. We’ve got a little intro to what we do something else is going to say. We do have some sponsors on this podcast yet but we got a few businesses so here we go this podcast was sponsored by Pipehouse Gin, if you like drinking gin and you live in the UK definitely check out Pipehouse Gin. Its flavored gin without the sweetness we’ve got one flavour out so far, earl gray and cucumber. Absolutely delicious, it’s London Dry which means no added sweeteners now add a flavor and on the 30th of March, we got a new flavor coming out which we were really excited about this a secret so look out for that. On Amazon you can buy us on our website Pipehouse Gin dot com, don’t wait to get it because it’s really good and we’re drinking it right now because that’s where our inspiration comes from apart from that, thanks for listening and goodbye.

#33: Value Betting

Making money from technical or fundamental analysis of the betting markets. In this episode, we talk about one of the logical next steps for a professional gambler, and where I made most of my money.

If you have experience with matched betting or arbitrage then this is a good episode for you.

Listen to this episode of The Lazy Entrepreneur Podcast on:

iTunes | Spotify | YouTube | Stitcher

Resources Mentioned In This Episode Of The Lazy Entrepreneur Podcast:

Structure

01:19 – Quick rundown of Sam’s professional gambling history
04:00 – Sam describes value betting with a simple coin example
06:02 – How to determine the odds better than the bookie: fundamental vs. technical analysis
08:14 – Arbitrage betting
13:23 – Win-draw-lose markets for football matches
17:01 – When there is not a normal arbitrage but there is a value bet
21:25 – Fundamental analysis
24:23 – Explaining tipsters
28:04 – How is this done on the stock market?

Transcript

SAM: Hello and welcome back to another episode of the lazy entrepreneur, I’m your host Sam Priestley and we’re joined by my lovely co-host Emma Priestly.

EMMA: Hello.

SAM: Emma I think that after we’ve been married a few years you’re going to be a real expert on all things gambling and betting and professional gambling related.

EMMA: I’m not sure about that.

SAM: I think you’re quite excited for that day. I still haven’t heard you tell any of your friends about matched betting or value betting or arbitrage or anything like that.

EMMA: I do tell some of my friends but most people their eyes glaze over.

SAM: Have you ever tried to explain it to anyone?

EMMA: Yeah I think I must have, what matched betting is anyway, very basic.

SAM: You probably heard it enough times, the most basic stuff anyway. Well you’ll be pleased to hear we’re not going to be talking about anything basic today. We’re going to be going quite deep talking about value betting.

EMMA: This is a very you topic.

SAM: I know I can’t wait, I am so excited I love chatting about this sort of thing. So for the listener out there let me give a quick rundown of my professional gambling history so when I was in university, I first got into matched betting which is finding bonuses that bookies would give you for signing up to them or for redepositing with them and you would hedge out those free bets in order to extract as much value as possible so I did that for a while then I moved onto casino bagging which is basically the same thing but with casinos. The only difference is there’s no way to hedge out your bet so you’ve got to be a bit more comfortable with variants, and rely a bit more on the maths behind it. The mathematics and then I moved on from that to arbitrage which is where there’s no bonus involved but you’re making your money by finding disagreements between different bookmakers between say a betting exchange like Betfair and a big bookie like Ladbrokes. They might have different odds and you might be able to buy one at Ladbrokes and sell it for a profit at Betfair. Now as a subject of my dissertation for my masters at University and I’ve spent a lot of time researching and making a living out of it and writing software on it and then

EMMA: And you made a lot of money off it.

SAM: I made a lot of money off it, and then after that we moved on to value betting. Now value betting is where you’re placing just one bet one open bet but you think that the odds the bookie have given you are wrong. That there is this good value for you now odds just represent the probability of an event happening so if we’re watching a tennis match, only two people could win and the bookie might think there’s a 50% chance that one player will win. I might think there’s actually an 80% chance that player will win and as such they’ve given me odds that in the long term I will make money. You’re looking a bit confused so let me try and explain that a bit.

EMMA: My eyes are glazed over.

SAM: Which is why I’ve got you to talk to here because whenever I see you starting to daydream about baking or something it means that I need to come back and refresh or rephrase what I just said. So imagine we’re playing a game of flip the coin so you got two coins, one coin, even easier one coin heads or tails. We’re gonna play a betting game on it you can bet a pound on either heads or tails. If you win you get a pound, if you lose you lose it pounds. Now if we play that game you’ve got about 50% chance of winning. So if you play that game long enough, you should make no money yeah because sometimes you win sometimes you lose.

EMMA: Yes it’s the same either way.

SAM: Yeah exactly. Now imagine instead I offered you a game where if you bet on heads you’d win two pounds and only lose a pound if tails came up. You would play all day long because every time heads comes up you make two pounds of tails comes up, you lose a pound so in the long run once we played this game hundreds of hundred of times you should be making loads of money and so those those are basically odds I’ve given you I’ve given you. Two to one odds on one side on heads, you decided actually the odds should be even they should be one to one and so therefore it’s a value bet and you’re taking it. So that’s what value betting is?

EMMA: Which part is the value bet?

SAM: The value bet is realizing that the odds I’ve given you will make you money in the long term, so the way a bookmaker works is they will work out the chance of something happening so the chances of each player winning the tennis match and then they’ll create odds that are slightly worse than that probability so they’ll make money over all and if you look at what the probability they assign to each player winning and then add them all up it will come to over 100% and that’s known as the bookie over round.

EMMA: Okay oh yeah sounds a bit.

SAM: And it’s where the name bookie comes from because it’s making a book and that is making a book when you create odds on every outcome of the event. So normally bookies are pretty good at this and even when they’re wrong, they’ve built in a big enough margin that it’s okay. Occasionally they are wrong and that is where the value better comes in. They can make money by basically working out better than a bookie what the true probability of an event happening is.

EMMA: How on earth do you go about doing that well that’s a very good question next part because in my head I can see lots of algorithms and computer programming.

SAM: There is a lot of computer programming. You’re correct but there’s really two ways that people do this. It’s similar to how people trade on the stock market. There’s normally fundamental analysis and technical analysis. I don’t know if you’ve heard these terms before but what they mean is the fundamental analysis means you’re looking you’re reading the perspectives from the companies, you’re trying to work out actually what that company is worth and then you’re seeing if you disagree with what the stock market says it’s worth.

EMMA: Yeah so kind of in business we call that due diligence.

SAM: Yeah so you basically want to look into all the stuff about it and find stuff that maybe the market doesn’t know yeah to get a better idea, that’s fundamental analysis. And that’s how people like Warren Buffett make their money because they will say that coca-cola is currently undervalued and it’s worth me buying lots of and they’ll go and buy coca-cola. So that’s fundamental analysis. Technical analysis is when you look at like the psychology of what everybody else is doing and how the markets are reacting and how the money is flowing through it and from there you work out where you think the price is going to go in the future

EMMA: Wow that sounds complicated.

SAM: It sounds complicated but I think by the end of this you’ll understand why it was a natural step for us. Now let’s go back to the idea of arbitrage, so with arbitrage, a tennis match, one bookie thinks that one player is going to win, the other bookie thinks that the other player is gonna win and I can bet on both outcomes, I can bet both bookies and lock in a profit. So that’s arbitrage. Now the step from that to value betting is that one of those has to be wrong. So there is value, one of those odds is value. Does that make sense?

EMMA: Kind of.

SAM: So when an arbitrage is in place it means that the probabilities have added up such that we will win no matter who wins. We will make money no matter who wins. One bookie will lose money from our bet, one will make money. And over a very long period of time it’s gonna even out that some bookies will lose sometimes and others will lose these other times. Over all they’re gonna lose money, overall I’m gonna make money because as value, at least one of those two bookies have miscalculated their odds. Yes so the next step from that to value betting is that by placing the bet of both bookies, we are paying a commission to the bookie who calculated it correctly. Because what they do is they’ve priced their odds in such a way that they’re going to make money, so if we take this idea that one is right and the other is wrong by hedging our bets and betting on both, the one who is right and has calculated yours correctly is going to be making money off us. So let’s say we found an arbitrage that has a 2% profit for us that we can lock in. By turning it into a value bet and only betting at the bookie who is wrong and not hedging it at the one that’s right, we will make more money.

EMMA: Yeah because you’re not also paying at the one that’s right.

SAM: Exactly yeah so that’s value betting. Now value betting is different to arbitrage in that it is not risk-free. There is variance but the idea is that it’s like that coin flipping game. You know it’s a good bet to bet a pound that maybe win two pounds from getting heads, but you could still lose. You could still lose a pound in one go but when you’re playing that 500 times a day, it’s gonna even out and you’re gonna end up making money. So what we did in this technical version of value betting was we would calculate, work out which of the different bookies were sharper than others, we would look at each situation where bookies disagreed with each other, work out which one was incorrect, which one where the value bet was and then bet on them. And then we would do that hundreds of times a day such that we were unlucky sometimes and we were lucky other times but over a long period of time and so when we were doing it I don’t think we ever had a two-week period where we lost money. So if you look at our chart it’s what would a little bit over up and down up and down but it’s kind of always going up. If you look at a daily profit, some days we lost money, if you look at the weekly profit, there’s some weeks we lost money but there’s never been a two-week period where we lost money. Just because we were placing so many bets.

EMMA: Wow and this whole analysis of picking the value like one week one bookie could be really sharp on I don’t know the horses, but then the next week like how do you.

SAM: How do you know which bookies sharp?

EMMA: Well is it something that changes on an hourly basis, is it something that changes on a daily basis, is it something that changes on a weekly basis?

SAM: Yes you’ve hit the nail on the head of what the challenge is when it comes to doing this value betting, is how do you work out which bookie is wrong? And there are some general principles that we worked on for that. I don’t want to go into too much detail, it’s not that I’m not sure we were right, it’s just backed up by our method and our results but we do have theoretical reasons behind it but it’s hard to know when those reasons were correct or we just got lucky at the time and we choose the right thing. So one of them was that market places such as Betfair where you’re betting against other people are generally more accurate than traditional bookmakers. So you’re betting in exchange and you’ll have hundreds of people placing bets and the odds move based on what people are betting on so they’re very quick to react. Whereas something like Ladbrokes is all done by people sitting there with the form sheets creating the yards and then some software to react to how much money is coming in. But they’re generally quite a bit slower than the market places is so if it’s a straight up between Ladbrokes and Betfair we will assume that Ladbrokes is the one who’s wrong. One other thing we look at is who disagreed with the majority. Generally the majority is right, so if we have eight bookmakers on one side and one bookmaker on the other side, the other one now is probably wrong. That’s something else we look at. Something else we look at is what markets they were on so for instance on a football match the win draw lose market is very big it’s very well understood, there’s lots going on whereas something like the first goal scorer market is a bit less looked after a bit less cared about.

EMMA: There’s more opportunity there.

SAM: So if there’s a disagreement between the win draw lose market and the first goalkeeper market we’re going to guess the first goal scorer market is the one that’s wrong yes and there’s also different bookies from different countries so Asian bookmakers are generally better than European and UK ones, they’re sharper.

EMMA: Well that’s fairly stereotypical.

SAM: Yeah and the reason of that is that all their markets are treated like a marketplace so they’re always two ways, only two options so instead of having a win draw lose yes market like we have it here in the UK, you’d have one team to win and the other team to win with a handicap of half a goal already added, which means if it’s a draw that team wins and two-way markets like that when one moves the other one moves.

EMMA: It’s a little more clean cut.

SAM: The more things going on, the harder it is for a bookie to know because of this one moved how should the other ones know, so generally Asian bookmakers are a little bit sharper so if you’re looking at the Asian Handicap arb so plus a one point five goal versus Ladbrokes got a team to win, Ladbrokes is probably gonna be wrong. There’s a whole host of things like that and let me talk a little bit, let me leave that for a moment because I think we’re getting into the weeds a little bit and actually what you can do is we talked about software, so there are software you can get that works it out for you. And we weren’t sitting sitting there with our spreadsheets at a time we built a software that would do that. There are some software now. One reason I’m doing this podcast is the rebel betting who are probably the biggest arb software out there for finding arbitrage bets have released a value betting bit of software which kind of does this for you it takes the same information they were using to find the arbs and then goes a bit further to work out where the value is.

EMMA: Is it good?

SAM: It is good and actually before recording this, I reached out to them and they have offered a bonus 20 to any of the listeners that want to sign up. If you go to rebel betting dot com slash lazy you get buy one month get one free and I think it’s half price anyway at the moment because it’s in the launch months and I’ll get a refer bonus from that as well. They’re the only one I know about who are doing this technical analysis of value betting.

EMMA: That you really recommend or.

SAM: Yeah I think they are just the only people doing it and there are other people who are doing the other type of fundamental analysis which will come on to talk about in a second and this technical analysis which is where I made my money, which is the stuff we were doing. Rebel betting is the only people doing it. The other way you can do it yourself is you can get a typical arb finder like rebel betting is a traditional one and work out for yourself which bookie you think is incorrect. Now there are times where there isn’t a normal arbitrage but there is a value bet. Say for instance let’s say there’s an arbitrage between Ladbrokes and Betfair. For there to be an arbitrage in place, there’s got to be enough room on the spread between the odds at Ladbrokes and Betfair for you to make money and there’s got to be enough room on that spread for you to pay your commission to Betfair. Whereas what we would do is instead of taking, we would take the midpoint of the spread on Betfair so on Betfair you can buy and sell odds yeah so let’s say we’re buying at Ladbrokes, we call it backing and laying, we’re backing at Ladbrokes and we’re laying at Betfair, there might not be an arb between, they might be the same odds. There might not be an arbitrage there, but if you looked at the midpoint of the spread between the back and lay on Betfair, suddenly there is an arbitrage between Ladbrokes and Betfair. It’s an arbitrage you can’t make money on but it is one that you can value bet on and make money that way. Not a situation where you can value bet where you can do arbitrage is if there isn’t any liquidity so you might find the market just haven’t formed that well. Somewhere like Ladbrokes might let you put a hundred pound bet down but Betfair might only have two pounds available for you to lay off, so if you’re doing a traditional arbitrage, you’re limited by how much you can get on at both places. And if you’re not sure what your limits are and all the places you’re arbitraging you have to be very careful because you don’t want to place a bet on one place and find you can’t place on the other one.

EMMA: Because that’s not arbitrage.

SAM: So what we found with value betting was actually it was much safer than arbitrage.

EMMA: Because you didn’t have to constantly check their limits.

SAM: Exactly there’s risk of variance on each bet but that evens out quite quickly and in terms of the actual return and the total amount of turnover we could get away it was much better.

EMMA: Yeah in that way it makes so much sense where you started off with arbitrage and then went to value betting.

SAM: And when we started this kind of stuff wasn’t really understood. I think we kind of in the back of our minds knew there might be some value somewhere but we didn’t really have any way of working it out.

EMMA: And yeah just bet loads and test it out.

SAM: Yeah and by this point we had years and years, thousands and thousands of bets, historical data all recorded that we can go back and have a look. We can look at how much you know our overall profit on certain bookies and stuff like that and then I think we would know you know this bookie we’ve only ever made money on so therefore there’s probably value. Okay so yeah let me say that again rebel betting dot com forward slash lazy if you want to try out some value betting if you’re signed on to an arb service anyway you can just use that for a little bit and try it out and follow the tips that I was saying about how to find out which side does value on but only do it if you can afford to lose some money because there is variance. Don’t do it if you have any sort of addictive personality because there’s a lot of psychological psychological quirks around value betting that makes it quite similar to psychology behind normal gambling in that you are winning and losing money and luck plays a role. If you’re the sort of person who might go on a tilt and chase your losses, if you had a bad day, just stick to arbitrage, it’s worth paying a commission so you know exactly how much time. Yeah that’s another reason why I haven’t really spoken out before because I don’t want to encourage people who don’t really understand what’s going on to go into it you know. Start with matched betting. You shouldn’t be doing this if you haven’t already done matched betting. Don’t do this unless you haven’t already tried at least a little bit of arbitrage because this is an advanced topic we’re talking about. There’s a lot of theory in here. It does work and I do have a lot of experience with it and hopefully by the way I’ve explained it it kind of makes sense but if you don’t really understand it don’t don’t do it because if you do it wrong you can lose a lot of money. Alright let’s talk about fundamental analysis. Looking at form this is where, so traditionally a bookmaker would work by they would sit down with all the information they knew about a horse and then they would try and work out what the chance of it winning was and then they would create their odds that way and as a bettor as a professional gambler as a professional fundamental gambler well I do it exactly the same. I sit down I get all my information out and I would work out what I think the odds were and then I go compared to all the other bookmakers to see if I’m discrete with anything for them and if I disagreed enough and I was confident enough in my own analysis, I would then place a bet. So once upon a time when I used to go to a race track there’d be hundreds, loads of independent bookmakers who had all kind of done this, created their own bookie, and they could go around, get odds from different ones do the price comparison, work out yourself and then compare before the internet they couldn’t then check the odds with different places so everything was quite independent. One racing track might disagree with a different racing track. There was one value better who worked out that this horse was almost definitely going to win.

EMMA: Against all odds.

SAM: And the bookmakers would have their their odds people in London and then at the race track they would have the people who take the bets and if they saw quite a lot of betting what they do is they go and ring up the central place and say oh we’re seeing this you know should we change the odds? They’d say yes. Or if the people go back at London discovered that you know they’ve got the odds wrong, they’d ring the bookmaker at the racetrack to change the odds so what this punter did was he got all his mates to go on all the payphones in the racing track and keep them occupied pretending to have like domestics and arguments with his wife so that the punt the bookies dead. And just kept betting kept betting and made a few million back before the internet, back before mobile phones. Nowadays that’s what fundamental analysis is very difficult because there are so many marketplaces that places like Betfair where everyone has a good view of the market so if you’re at Ladbrokes and your odds creator says he thinks you should do this and you look at the market you’ll say well everyone else thinks you’re wrong. They’re going to go in the market, they’re not going to go with their boffin when it is in his form paper though some people do make money on that that’s kind of where the idea of tipsters come from.

EMMA: Sounds like hipster to me yeah.

SAM: You’ll find loads of them on Twitter you know I think that this is a good tip. It’s like giving a tip I think you know, this horse is a good tip for it to win. I’ll bet your dad has got a few good tips on things in the past.

EMMA: Yeah I don’t know I bet my brother does as well.

SAM: But it’s a bit of a thought you know that’s fundamental analysis probably a bit of insider trading going on and a whole lot of bullshit.

EMMA: I was going to say you don’t sound very positive about fundamental analysis.

SAM: It is really difficult and the people doing it well aren’t really telling you about it because why would they? Why would they let the bookmaker know what’s going on sonine out of ten tipsters will lose money.

EMMA: Why you would be a tipster? Why would you give out information?

SAM: Well because you charge for your tips.

EMMA: But they’re on twitter.

SAM: So Twitter is where they’re affiliated with the bookmaker and they’ll earn a percentage of any losses.

EMMA: Encouraging people to bet and lose.

SAM: Yeah really bad and that’s why you got to be really skeptical of tipsters and there are some good tipsters and I do have a couple friends who make money from a living from following like one or two tipsters but often you know to find these people are, they’re not advertising on Facebook. There’s a couple of marketplaces you can go on where you can see their historical performance of tipsters and have a look that way. There are a few sort of private groups that you kind of have to be invited into or sit on a waiting list and pay a fortune to get on, so some tips that we all give out are good and we’ll give out their tips because they’re banned by bookies for being too profitable and they can’t really bet at betting exchanges like Betfair anymore because of things like the premium charge. Now a premium charge is a fee that Betfair charges to people who are too profitable on their system and it can go up to I think last time I checked it was 65 percent of your profit.

EMMA: Wow.

SAM: They can just take as a charge so some people say well I’d rather charge people to have my tips and they can bet themselves than give up on my profit, so that’s the reason but you know I’ve never really made any money from tipsters. I haven’t made any money from fundamental analysis. I don’t know much about it. Be very careful with it and don’t confuse these two, a type of technical analysis with talking about. It’s completely different to reading form and thinking that you’re cleverer than the whole marketplace of gamblers and bookies and everyone out there.

EMMA: Yes it’s a very sophisticated complicated industry. Otherwise everyone would be making money.

SAM: Well that’s it, that’s the takeaway is that it’s very hard to make money.

EMMA: Otherwise everyone else be doing it.

SAM: It’s also very hard to make money doing fundamental analysis on the stock market so I’d recommend not doing it either.

EMMA: So are their whole companies set up to do fundamental analysis on the stock market.

SAM: Yeah they’re called hedge funds.

EMMA: Oh is that okay.

SAM: Most investment, most hedge funds and investment firms are doing some form of fundamental analysis. It does get complicated more complicated than that.

EMMA: Yeah I’m sure it does that it’s quite nice to hear it in a simpler way.

SAM: And like there’s been a lot of research that says that hardly any hedge funds out before or investment firms or mutual funds or any of these other companies outperform the index and you’re better off just buying an index tracker and not paying huge fees and you’ll make more money in the long run.

EMMA: Why would anyone spend money on hedge funds then if that’s the case because of their kudos and reputation and then you think that your money’s in your large amounts of money are in a safe place.

SAM: I think there’s a few things at work, one is a fear of missing out. There’s this genius who you’ve met and he seems really clever and you see his last two years and he’s doing really well and anything, oh if I can make twenty percent a year like they’ve been doing, that’ll be it. There’s that, there’s also this idea that these people are professionals, they’re the smartest people in the room. Surely they’re gonna be better than just a stupid computer system. There’s also the idea that if everyone just bought the stock market, bought index trackers that it wouldn’t really work.

EMMA: You need to have a balance.

SAM: There needs to be some sort of fundamental analysis going on, otherwise you don’t know what the value of anything is. So have you got any questions?

EMMA: I don’t think so I think I understand a little more the basics now. It doesn’t give me a sudden rush to go off and start doing it myself.

SAM: You don’t want to head down the racetrack, get your mates to block the local phones in the area, clean out the house.

EMMA: No but I definitely feel like I have some friends that would do that.

SAM: Cool story isn’t it. There’s so many of them out there. Maybe I’ll do a whole episode on tales of professional gamblers. That will be quite fun. Alright well we’ll come back to that in a future episode but for now let me throw out my little refer a friend deal as well. So mine will make a little bit of money. So maybe you will look at some value betting using a technical analysis that we talked about earlier. I’m also doing a big blog post on all this sort of stuff if you want to sort of look into it a bit more and if you ask any questions on there in the comments I’ll do my best to answer them. That’ll probably be out by the time this podcast gets released. If you have any good ideas for episodes you want to hear as well or just general feedback about the podcast in general please email me at hello at sam priestley dot com and as always I would love it if you could leave me a good review until next time goodbye.