The Lazy Entrepreneur Podcast
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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
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“The most important skill as an entrepreneur is knowing how to learn and how to improve.” – Sam
On this episode of The Lazy Entrepreneur Podcast, we talk about six skills that you can work on now that will be crucial in helping you become a successful entrepreneur. Skills that you can work on improving right now:
- Financial Literacy
- Getting Over Fear of Rejection
- Written Skills
- Self Discipline
- Creativity & Out Of The Box Thinking
Sam describes the importance of management and leadership skills [01:06]
What business did Sam start in primary school? [03:00]Why is it important to gain experience managing people even when you don’t have the title of “manager” [05:00]Emma describes how to cultivate the skill of “upward management” [07:48]What are some ways you can gain leadership experience outside of work? [08:30]What is the importance of financial literacy or accounting for an entrepreneur? [10:29]What accounting terms did Richard Branson not know until he was in his fifties? [11:30]If you were a business, would you be profitable? Are you a good investment? [12:38]What role does rejection play in the life of an entrepreneur? [14:52]
How to learn how to get comfortable with rejection [18:37]Why Sam wishes he worked at a call center for two weeks during school, and why Sam actually used to volunteer as a police officer [19:37]How repetition breeds comfortability [21:10]Writing as an essential skill for anyone [23:37]The struggle of self-discipline [27:13]What role does thinking play in productivity? And how does it differ in an entrepreneurial versus a corporate setting? [28:30]Why does Sam set 30 day challenges for himself? [30:08]What role does creativity and out of the box thinking play in entrepreneurship? [32:29]How does generating 10 ideas about a particular topic enhance your understanding or efficacy in that area? [34:29]Why meetings are not “dead time” [36:52]
Hello and welcome back to another episode of the lazy entrepreneur. I am your host Sam Priestley and I am here with my wife Emma. Today we will be talking about the six key skills that every entrepreneur needs. tHese are skills you can develop and work on and that you don’t need to be born with. And also skills you can do whether you are an entrepreneur already or just aspire to be on one day. And ones that I personally believe that while you can get by without them, your business is really going to suffer. And to get all meta on you, I also believe that the most important skill as an entrepreneur is knowing how to learn and how to improve. So hopefully by focusing on these six key skills, we’ll also be learning how to learn. Alright, let’s get started. So the first one and something that I am notoriously bad at and if you listen to my podcast or read my blog you’ll probably know that I go on about this a bit too much is management and leadership skills.
Sam describes the importance of management and leadership skills [01:06]
It’s something that I have kind of fallen into the self employment trap of by knowing that I am not good at it so trying to build businesses and avoid having to have them, so doing stuff that is relying on automation or technology and not on other people. Or focusing on sort of highly skilled other companies to do stuff for me, so instead of hiring people in a house, finding a company who can take a specific role in the business. And yes it is something that I do try quite hard to improve on and I have done quite a few businesses where I have tried to hire people and manage them and have struggled. So it is something that has been a real sort of long running battle with me.
E: Yeah, like the tech start up
S: WIth the tech start up, with the coffee shop. And now I have gone backwards and don’t have any businesses that have any employees at all.
E: Yeah, but do you have a management role in a lot of your businesses. You manage suppliers and have business relationships. That might not necessarily be full time staff.
S: Yeah, so managing business relationships with a factory who might develop your products or with supply chain, all that kind of stuff. Actually kind of management and leadership is something that I have been trying to work on the whole of my life. I have always known I’ve not been very good at it. As a student I would try to start a society or start a mini business in school, so when I was in primary school I started a school newspaper.
What business did Sam start in primary school? [03:00]
Started a couple clubs in secondary school. I joined the cadet force where I was in charge of other students. I think that leadership and management is something that a lot of people consider that you don’t need or don’t need to start working on it until later in life and kind of assume that you start off at the bottom of the ladder as an employee and then you get given a management role and then you convincingly become good at it or it is kind of a natural skill and it is not something that you learn. It is not learning how to use an excel spreadsheet, it is more of a soft skill. Some are better leaders than others. Some are better followers. I think that’s true to some extent but that doesn’t mean it’s not a skill that you can learn and get better at. There are hundreds of management books out there and big corporations are constantly sending their people off to management schools to get better at it. The whole idea of doing something like an MBA is to get better at managing people and businesses and when you were working at PWC you had to demonstrate your management abilities before you were allowed to even apply to become a manager.
E: Yeah, which is really difficult because how do you manage someone when you’re not a manager. You have to go out and find those opportunities, so whether it is starting your own initiative like a little club like I did, the same colleagues that are in the same grade as me or you put yourself forward within your team to run projects but that is all about the relationship that you have with your boss and putting yourself forward. I wouldn’t have gotten a manager if I would have just let things be and just not seeked out any opportunities because ultimately I wouldn’t have had the opportunity to manage someone and then I wouldn’t have been able to get to manager.
S: So you can get experience managing people without someone giving you a job as a manager. Can you give me some examples?
Why is it important to gain experience managing people without necessarily having been given the title of “manager” [05:00]
E: So there were marketing execs that would meet once a month to discuss issues we were having. It could have been something technical with some of the systems we were using, it could have been a training opportunity that one of us has found and we would recommend, or it could be that we are having this real issue with someone in our team and we just wanted someone else impartial to talk about it that we didn’t work with. That was like an open forum for people to discuss. And I would control the topics and run it.
S: Yeah, so I think kind of what you are saying is that you don’t need to have people underneath you in order to be doing some management. You can be in a group of peers and start something which you are kind of running. And then managing kind of sideways.
E: Yeah, but that does take a bit of courage and also a bit of creative. It is not just following what everyone else has done or is doing around you.
S: Yeah, it is not just waiting for someone to give you the management or leadership sort of stuff. I 100% agree, and I actually think the skill of managing and leading people who are the same level as you or even more important than you is an even better skill. If you can do that, you’re going to have no trouble for whom its their job to do what you tell them. If you think that just because you have a title, that you’re going to be able to tell people what to do and they’re going to do it, it doesn’t really work like that. I think it’s something that I, especially as a child, when you think about stuff like a general in the army, you think people do what they tell them just because they’re a general, when actually that isn’t really the case. Being a good leader means you’re someone that people look up to and want to follow or just a good manager, good at inspiring people, good at getting people to do what you want is just as important. So you kind of talked about how you do that in a big corporation, you set up something sort of different like an outside of work project. There is also stuff like you can talk to your boss and take the lead on certain projects. Which might include managing upward. Sort of partners who are all involved and you kind of take the role of managing the project and making sure it gets delivered.
Emma describes how to cultivate the skill of “upward management” [07:48]
E: Yeah I was going to talk about the skill of upward management because for me I had a lot of skills around digital marketing and we’re talking kind of four years ago now so digital marketing was still quite new for someone like PWC so me taking the lead on social media, email marketing, general use of the website, even as basic as that, kind of carved out a bit of a role for me and made me look more senior and more in control than I guess I was, because the people I was working with were a lot more senior to me, and they didn’t know or have any of the skills that I did. So by teaching them about digital marketing, I kind of boosted myself up.
S: Yeah, and if you don’t have those opportunities, maybe you’re not in that sort of business, there is always a bunch of stuff you can do outside of work. For instance, if you’re in a local church, you can speak to them about running an event and take control of that. Get a bunch of volunteers to help you and manage the whole event. If you’re in school, you could talk to the faculty about putting on another sort of event or specific project. You can do stuff like Duke of Edinburgh or join a society or create your own and take the role on that, you were president of a couple societies at uni, which again teaches you a bunch of skills which will kind of cross over to entrepreneurship.
What are some ways you can gain leadership experience outside of work? [08:30]
Another thing I think of when I think of management and leadership are you organizing our wedding. And there you had to manage a lot of different suppliers and juggle everyone together. I think what I’m saying is to be a good manager, you don’t need to be in a management position. You can look at the skills that a manager can have and then try and do stuff that will then teach you those skills and then learn them. So it doesn’t really matter if you mess up or don’t get along with the people you’re managing because it’s just one small project, which means you’ll make all the mistakes early on so by the time it comes for you to hire you first full time employee you’ll know who you can work with, who to look for, what sort of person will be more rebellious than you can handle, whatever. Ok, let’s move on to the next one which I am calling financial literacy or accounting.
What is the importance of financial literacy or accounting for an entrepreneur? [10:29]
This is something that a lot of people kind of know is important but also think that they can outsource. I think it is terrible the number of small business owners I have met who have no idea whether their business is profitable a lot.
E: That is crazy
S: Especially stuff like coffee shops or little small shops, they don’t really, and sometimes you’ll sit down and look through the numbers and you’ll see that there is almost no way they can be profitable. So if you just sit down and put together a simple spreadsheet, how many customers do you need, how much do you make per amount of coffee you sell, they’ll hire an accountant to look at their numbers for a half hour every three months or once a year and then they’ll give them advice. That is not good enough, you need to have a really good grasp of what’s going on with your business. That doesn’t mean you need to know all the terms. Richard Branson famously didn’t know the difference between net and gross until he was in his fifties.
What accounting terms did Richard Branson not know until he was in his fifties? [11:30]
But that doesn’t mean he didn’t know what makes a business profitable. He knew logically and the common sense of how to look at how much you’re spending, how much is coming in, take the two away and you’ve got your profit. How to use a simple spreadsheet. You don’t need to be using pivot tables or macros. Simply plus or minuses to work out what it is your business needs to do. It is something that people do neglect and we don’t really get taught it at school, I don’t think. We kind of get taught maths but we don’t get taught to apply it to stuff like this. So again I thought a little bit about how you can learn these things without actually diving in and starting a business ike this to begin with. The most obvious one is to think about your own finances. Have a look at your income, your expenses. If you were a business, would you be profitable?
If you were a business, would you be profitable? Are you a good investment? [12:38]
If someone were to invest in you, would it be a worthwhile investment.
E: This is the most you think I have ever heard.
S: It is so geeky but I love it. What would you have to do, what are the risks about you? If you lost your job, is your business bankrupt or would it survive? HOw much are you saving. There are loads of other things you can do, doing one off projects and events. If you are running a pot roast at your local church. Do the finances for it. HOw much does it cost for the ingredients. How much do you need. How much are you going to make? That sort of thing. Community events. Stuff to do with school, young enterprise, things like that, run a society or university, make the books balanced, do all the maths, make sure it is actually not losing money. There are video games you can play or board games to give you a little idea on how to balance the books, how to make money. If you can’t really do any of that, think about maybe offering to help friends who are already doing things like this. Let’s say you have done your own finances, maybe talk to a friend who is kind of struggling and offer to help them with that. Think of them like a business, offer to go through their finances, maybe create a budget, look where they can save money, what are the best they can do? That way you are going to help someone as well as helping yourself to learn these skills. There are also charities you can volunteer at to do a similar thing and then do sort of financial literacy classes. YOu don’t need a maths degree to do this, you don’t need an accountant degree, you just need to be able to know where your business is going to make some money. Alright, onto the next one, we don’t really have a good title for this so I’ll call it fear of rejection and I’ll put down a bunch of things like dealing with confrontation, dealing with rejection, cold calling/approaching, sales.
What role does rejection play in the life of an entrepreneur? [14:52]
E: It is putting yourself out there isn’t it. Instead of being in a big company where you’ve got loads of colleagues and you’re protected, potentially you are going out there on your own.
S: Yeah, and I am kind of including anything in here where you’re going to either end up in a confrontation or you’re going to face rejection. You’re going to be turned down a lot, you’re going to be told no a lot or people might be angry or aggressive with you. Which is something again we don’t really learn at school. You can follow through life a very ABC pattern where you don’t really have to deal with this too much. But it is very important, especially if you’re running your own business. A lot of businesses struggle to get sales, and part of that is that they want to only be approaching and selling to people if there is a good chance that they will say yes. Whereas you’re going to struggle to grow that much. I really struggle with this with my blog. In fact, I kind of stopped marketing my blog because I didn’t like putting it out there in front of a bunch of people. And then getting mean comments from a few people. Even though 8 out of 10 really appreciated the content that I was putting forward, 2 or 1 out of 10, maybe even less than that, would say mean things or criticize it. So I struggle with it. But if you’re going to do anything entrepreneurial which is different out of the box, you’re going to get rejection, to face confrontation, you’re going to have people tell you what you’re doing is rubbish and a bad idea. It kind of crosses over a bit with our first one, leadership and the confrontation, how do you tell off bad employees, how do you let people go, how do you fire them? It is not easy. Especially if you are quite an empathic person, if you’re the sort of person who wants people to like you.
E: I think most people are aren’t they.
S: I think most people are.
E: I guess with every business you’re opening it up to negative feedback and criticism. So with the gin business, there could be customers that don’t like the taste of our gin. That is not something that we want to hear but ultimately that is part of having a business. We haven’t made a product that every single person in the world is going to love and that is the point.
S: And the gin business is a classic example. We aren’t going to door to door trying to sell it, we’re going to bars and restaurants. And a lot of them will say no and that is a terrifying thought for many people, including me. Walking into somewhere apprentice style with a product that you’re trying to sell to someone who might well not want it.
E: Whereas in reality, when you meet people, or when I meet people and give them a sample of our gin, everyone is usually quite pleased to see me and they love the fact that they are getting a free mini bottle of gin and actually it kind of breaks the ice. It is the bit afterwards where you follow up several times over email and phone to then, well I have only had it a few times. But for a manger to then say, oh no, I don’t like the taste of the gin. No I can’t stop any more gins. So then you suffer rejection and then it feels worse because you’ve worked harder for it. It isn’t a rejection straight off.
How to learn how to get comfortable with rejection? [18:37]
S: So how can you learn this as a skill? When you don’t have a full time job, it is kind of an easy solution. You get a job or a part time role and you just learn these skills. As a sales person or you there are hundreds of position based only sales jobs around. It is a lot more difficult to get a job where they pay you an hourly wage and hope that you’re worth it vs. a job where they pay you nothing but it is just based on you selling their products. ANd then there is also a lot more on you and it is much more on you. THe better you get at sales and approaching people and cold calling or whatever, the more money you will make, the more sales you get. In year 11 we do a week or two work experience and I went and did something kind of pointless. I think I went to primary school or something like that. I always think the best thing I could have done would be to work in a call center, cold calling people. It would be horrendous, but only for two weeks, and making hundreds of calls a day like that would definitely get you over that hump of fear.
Why Sam wishes he worked at a call center for two weeks during school, and why Sam actually used to volunteer as a police officer [19:37]
Something that I did for quite a few years would I would volunteer as a police officer. I think if I can deal with arresting people, if I could deal with…
E: The general public shouting at you
S: If I could deal with people fighting… I could deal with anything. What’s the worst that could happen if you pitch an idea? They could tell you no it’s rubbish. What is the worst that could happen if you’re a police officer and you could try to arrest someone? They could attack you. The scales are totally different. Again it is still something I am not very good at but it is something I am working on and have put quite a bit of effort into improving and it is something you should be working on and you should be trying to improve, get yourself out of your comfort zone.
E: With the cold calling, it is something that I had to do with my first job in London. It is not easy to start with, it is not a natural skill for me but I did it so many times that it did become natural. The fear was removed and I am actually quite happy to be speaking to people on the phone. It does not worry me because I had to do it so many times. So I think practice and doing something that you’re scared of could be going for a job interview, doing it multiple times makes it a lot easier.
How repetition breeds comfortability [21:10]
S: And if you’re working in a big corporation, it could simply be going over and speaking to the important people. You could be going over and talking to the important partners. Most people get us to do it, it will make you stand out and will help you get over that fear of the unknown.
E: And the more you do it, the more you realize that you are just talking to another person. They are not a monster. You can have a personal conversation with them.
S: Alright, now we are going to go to something quite different. Written skills. It is something that I am naturally very bad at. I am not a very good writer.
E: I don’t agree with you.
S: That is only because you’ve known me after I have put a lot of effort into getting better at it. But it is something that at school I would always choose subjects that didn’t have any writing at all. Maths, computer science, where it would always be number answers rather than having to write an essay. But really, written skills are an incredibly important skill, whatever you’re doing. If you’re going to work at Google, you’re still going to have to write reports on whatever you’ve done. You’re still going to have to give feedback to people, to comment your code, if you’re a mathematician, a scientist, you will still have to write up reports.
S: Presentations, whatever, the same as if you’re an entrepreneur. You still are going to have to write emails, do customer service, write your business plan, do your grant applications, write your press releases, do your business procedures and your instructions for your employees.
E: And the marketing.
S: And the marketing. If you avoid writing, then you are never going to get good at it. And the gap between you and everyone else is just going to get wider and wider and wider.
Writing as an essential skill for anyone [23:37]
S: It is really an important skill. So how do you get better at it? Well you don’t need to be a fiction author. You don’t need to be really eloquent. You just need to be not making spelling mistakes, get your thoughts out onto paper. You need to not be afraid of writing 1,000 words or 2,000 words. So how do you do that? Well, practice is really the only thing. You can take courses, like a journalism course in your spare time like one day a week is quite useful because it teaches you certain skills in journalism you have to churn out a lot of quantity rather quickly and you learn how to write basically.
E: And take notes and edit.
S: One of the things I did is I started a job as something I did to get better at writing. Actually at A level I took history rather than something else. Even though I knew it was pretty much impossible for me to get an A in it, I ended up getting a B which was definitely as good as I could’ve got. I put a lot of work into that. Just because I thought it would teach me how to write, how to get my ideas down on paper. Whereas the other modules I had were physics and math and they didn’t need any of that.
E: Yeah, I think it is interesting that on your computer science degree, you did have to do essays as part of the degree. It wasn’t all numbers.
S: Yeah we did and we were all terrible at it.
E: Yeah but I think the fact that you had to do it was quite interesting. They recognize that you’re all on average not going to be very good at writing so you should be forced to do it.
S: Yeah, there are a lot of excuses people have for not being good at writing. You’ve got one, that you’re dyslexic. And also, when you went to work at a corporate job, you purposefully didn’t tell anyone that you were dyslexic at the time because you thought that it would hold you back. It would be seen as an excuse, and in fact, and therefore you had to overcompensate by spending a lot more time on the written parts. And I remember maybe a couple years ago we found your original dyslexia report and I am not sure you would have, if you would take it again, if you would be classified as dyslexic. Not because you’re not dyslexic, but because you have spent a lot of time learning the skills to actually write coherently and get around it.
E: Yeah, and there are a lot of comprehension skills that I was having. It wasn’t just getting words to paper. A lot of the comprehension stuff I definitely got over.
S: And that doesn’t mean it isn’t harder for you than others, it just means that you have had to put a lot more work at it but you have still got better at it, and that is true for everyone. Just because you are bad at something, if you avoid it you are not going to get better. Just because you are bad at something doesn’t mean you won’t get better. You might never be a proper author or whatever but you can be good enough. It just takes more work. Okay, moving on. Here’s another one which I find particularly challenging, and that is self discipline.
The struggle of self-discipline [27:13]
Again, all of this stuff, people are sometimes naturally good at or naturally worse at. And some people are obviously self disciplined and very good at making themselves do stuff but other people are naturally lazy like me.
E: It is interesting that you say you are naturally lazy because other people in our lives think you are very productive, particularly once they read your monthly reports and they realize how many different businesses you are juggling and how many things you have achieved that month.
S: People judge me on my output, not on my day to day. Whereas you see my day to day life and you see just how little I actually do.
E: See how many video games you play, yes.
S: Yeah, I find self discipline very difficult.
E: One of the big things with you is you actually spend a lot of time thinking and you might be doing another activity while thinking and that is part of your work, whereas when I was in my corporate job, I wasn’t given time to think. I was expected to do that outside of work and really you don’t want to be thinking about work all the time, but that is a big part of your business and your success.
What role does thinking play in productivity? And how does it differ in an entrepreneurial versus a corporate setting? [28:30]
S: Definitely. And actually, that is what we would be moving onto the next section. It is a balance right, you do need self-discipline and self-discipline is something that you can learn. One thing I like to do is set challenges for myself. I’ll set myself a time limited challenge. If it is going on forever I won’t do it. That doesn’t mean it doesn’t work for me, setting day habits, saying every morning I am going to do this forever. That doesn’t work forever. If I say forever, I’ll stop in two days. What does work for me is for the next month, I am going to do this. Competition is good and works quite well with me. So that is kind of my internal motivation. My competitive side. I also don’t like letting people down so I will often tell people my challenges so they can hold me accountable to it. So for me, the way I practice self-discipline and actually which then translates into how I get certain things done is by setting challenges and then making sure I do them. Announcing them and then doing them.
Why does Sam set 30 day challenges for himself? [30:08]
There are other ways of helping to learn discipline. Taking a difficult sport or hobby on is another example of that, especially if you are young and, actually it doesn’t matter if you’re young. I am practicing a lot of jiu jitsu and it will take me a lot of time to get good at it.
E: And there are lots of different ages.
S: It is something I can do forever, but it is something that requires discipline because it is hard. But I think people think about this more at school because there are more opportunities to start a new hobby, a new sport and then if you end up doing that properly and you reach a good level of it throughout your school career, along the way you would have learned a lot of self-discipline.
E: So whether it is learning an instrument.
S: Or learning to play chess, or juggle. I am really quite bad at that. There are other things you can do outside of this which can also help you benefit by creating something productive for you. So what I put down is find a dead time in your day which is time spent on the train commuting, or your two hours of TV that you watch every night. It is time you are not producing anything and you can set that time to be a challenge and do something else. Write a book, learn a language, take a journalism course, or you can use that for maybe once a month you focus on a different one of these skills. Find dead time and then use it to focus on one of the six skills we’re focusing on today. Okay, let’s move on to the final one. Which I am calling creativity and out of the box thinking.
What role does creativity and out of the box thinking play in entrepreneurship? [32:29]
I have put this one last because it is really difficult and kind of hard to quantify. I think that people just assume that you’re creativity or ideas you come up with are due to innate creativity.
E: It is something you’re born with.
S: Yeah, it isn’t something you can train… I obviously disagree. Yes, it does come more naturally to some than others, but it is something you can cultivate, so for a long time, I did this 10 ideas a day practice. Where I would pick a subject and come up with 10 ideas of it. I first heard it from James Altucher. And that worked really well for me. So I would pick a subject such as ways to improve sales for our gin. I would come up with 10 ideas. I then kind of developed that into more targeted stuff, so if I had a meeting that day, I would think of 10 ideas of stuff I could say at the meeting that would be useful. Or 10 ideas for something that are relevant for whatever the meeting was about that would be a good point.
E: It was interesting because that wasn’t all about business was it. Sometimes it would be about things in your personal life. What was really prominent, what were you thinking about at that point in time.
S: Exactly, it is going deeper into a subject. Like your birthday is coming up, let’s come up with 10 ideas for presents for you. Because often your best idea comes up at 7, 8 or 9. It is something that then goes deeper. So your first idea might be to start a gin business, so I could come up with 10 ideas for how to start a supplier or for what kind of brand I might like, or 10 ideas for different publicity stunts that would get into newspapers.
How does generating 10 ideas about a particular topic enhance your understanding or efficacy in that area? [34:29]
Yeah, so that helps developing out of the box thinking. Robert Rodriguez, who is a film director who I really like, what he does is he flicks between creative stuff but a different target. So he will get one of his actors to at one point be given a guitar, but they don’t play guitar, so he’ll have them play the feeling of the character, or draw the character, or write a short story of the character. All kinds of different things that tug on different parts of your brain and hopefully bring forth that creativity. So how do you go about doing this as a student or employee? Well, as a student there are quite a lot of opportunities. At school you have things like Young enterprise, at uni you have entrepreneurship opportunities, you have events like pitch nights where you pitch a business plan, you get better at your presentation skills and come up with good ideas.
E: And listening to other people’s as well, giving them feedback, seeing how other people think when they are trying to think outside of the box and think of creative or unusual stuff.
S: As an employee, you’ve got, I have already spoken about thinking about meeting and preparing and thinking about a bunch of ideas you can contribute to a meeting. I find that whenever I go to a meeting, most people don’t think at all until they’re in the room. If it is a brainstorming meeting, people try to go to the meeting and then think about it. So I try to think about it ahead of time, and then I won’t tell anyone that I do this so people think I am a genius because I’ve come up with loads of ideas because I have spent 45 minutes beforehand thinking about it.
E: Well that makes sense, I have been in some of those meetings!
S: I think it helps you stand out a bit at work. Having something to contribute at the meeting because you have spent time beforehand. I would argue that if you’re looking for a promotion, standing out in meeting is one of the best ways to do that, more so than what you are doing outside of it. A lot of people think meetings are dead times and they can’t wait to get out, when actually meeting are the time where you’re most going to impress and you’re most going to demonstrate what you have produced. Something else that I think about with this and kind of ties into sort of fear of rejection is just giving ideas to your bosses or higher up people in the company.
Why meetings are not “dead time” [36:52]
So thinking say 10 ideas of how they can improve their product or they can market the business better or they can solve a problem that you know the business is having. And then just emailing it or speaking to your boss or whatever, picking the best couple of ideas and then sending it to the CEO of the company or something like that. Chances are they just ignore it, but if you do it a few times you can be known as…
E: Someone to bounce ideas off someone you respect their opinion
S: Someone who thinks independently. You might be thought of as an annoying geek about how the company can improve its bottom line. It makes you stand out. They might not think you’re cool, but they’ll think you’re a good employee. And it also helps your creativity as well. And that is it, that’s the six. Let’s go through them quickly again. You have management and leadership, you have accounting and financial literacy, you have no fear of rejection, you have written skills, you have self-discipline, and then you have creativity and out of the box thinking. Obviously there are hundreds of other skills out there, technical know how, building websites, things like that, logistics, vocational skills around your business, how do you make gin, how do you program a web app, how do you make coffee, but all of those things you can learn on the job. I think they are less important than the six we have spoken about.
E: Yeah you can learn as you go along.
S: And if you learn how to learn, that stuff all becomes easier. But those six skills are key and if you are lacking in any of them, then your business is really going to suffer. It doesn’t mean you’ll be a failure or won’t succeed, but it will never reach the potential it could. But there is a slight loophole to getting around a real deficiency, and that is partnering with someone who has them. Someone who has the complementary skills that you don’t. And that is where we’ll leave it today. Anything to add Emma?
E: No, I don’t think so.
S: Good, you want to hear a bit more about how to find a partner and is it right to get a partner for your business, then we have another episode on that. As always, if you have suggestions for
We discuss the different ways you can promote and market your business:
- Public Relations
- Content Marketing
- Community Building
- Search Engine Optimisation
- Business Development
- Direct Sales
- Affiliate or Commision-Based Marketing
- Paid Advertising
This episode of The Lazy Entrepreneur Podcast was turned into a blog post here: How To Get Customers For Your Business
S: Hello and welcome to another episode of the lazy entrepreneur. I am your host, Sam Priestley, and once again I am joined by Emma Priestley, my wife. Say hello Emma:
S: So for the last couple of episodes we’ve used a new format, so let me know what you think at firstname.lastname@example.org. So let us know what we can do with these podcasts, I am open to suggestions. A few people mentioned they’d like to hear a jingle at the beginning. If you’re a jingle producer to create one for me, I’d really appreciate that. Alright, on for today’s topic. Today I’d like to talk about how to get customers for your business. So we’re assuming you’ve got a business, you’ve got a product to sell, there’s a blog that you’re writing that you want people to read, software as a service that you want people to sign up for. Maybe start freelancing and you’re trying to get customers. Generally, the way you market these businesses is quite specific. And some general guidelines we can follow, or pretty much all of them. And hopefully this gives you a look into how I think about marketing, how I think about getting customers. So what we’re looking at today are marketing split into 10 different categories, and generally what I try to do with any of my business is to do a bit of trial and error for each of these types of marketing and I see which ones work and then I really go in deep onto that one type. Generally, you’ll find that one will work really well for a while and you’ll reach a saturation point and then it is time to move onto the next one. Or you change your product slightly on the original product you’re doing, and then you tweak the product, or you get higher margins so you can spend a bit more and do a different style of marketing. It’s one of those. So we’ll cover a bit about each of these and then we’ll talk a little bit about how I’ve implemented each one to a business. And Emma is going to help with that because she is a marketer. She was a marketing manager at PWC and then freelanced doing digital marketing for a year and a half after that.
S: So we’ll get a pretty good discussion out of that and hopefully you don’t disagree with everything I say.
E: I think I will because I am a corporate sellout and you’re the entrepreneurial do things differently.
How do Sam and Emma’s approaches to marketing differ? [02:44]
S: You’ve actually odne courses, I just make things up as I go along. Alright, let’s dive in. So the first one I want to talk about is PR, public relations. And by that one I mean is getting other people to write about you or produce content for you that can be other bloggers, it can be from instagram, but generally we’re talking about media, about newspapers, online news signs, stuff like that. One of the reasons I really like this type of marketing is that it doesn’t cost you anything. You may have to hire someone to do it or your time to do it but you’re not actually paying them any money for you to appear in their newspaper if you just get all that free publicity. It’s something that Donald Trump has honestly done very well when it comes to his presidential election, he has an incredible amount of free publicity by creating these PR storms that people just love to write about, as compared to Hillary Clinton, Donald Trump was the first person who spent less and won, which is quite interesting and shows the power of this type of marketing.
What type of marketing did Donald Trump use well in the presidential election? [03:30]
It is also quite a daunting one and one that I’ve only really started doing since pretty much Pipehouse Gin about a year ago. Like how do you get in touch with newspapers? How do you write a press release? How do you provide – who do you email? Editor at the times dot com or something? Editor at bbc news dot com? These are obviously really big companies that specialize in just that. People that are probably ex-editors of these places that have all of the contacts and it is a bit of an old boys network. It works very well.
What sort of marketing did Pipehouse Gin use? [04:51]
S: So for pipehouse gin, we went quite a traditional route. We submitted a press release statement which went out to all of the local newspapers and media outlets about something that is interesting about our business. We just won an award, or we have a new flavor coming out, or a launch party coming up, or any excuse. We will send it out, if it’s an event we might invite some of the journalists along as well or the local bloggers or the instagram celebrities. And hope that they will then translate the sort of information we have given them into newsworthy articles.
E: Yeah and we also attach some professional photos of the product and of us because we wanted to promote ourselves and tell the story. So, actually having pictures of us was quite crucial in that.
S: Yeah definitely. It is kind of like we wrote that article for them. We gave them a structure of what we thought they might want to write, we gave them the pictures, and just made it very easy for the journalist to turn that into something. It works quite well in the local settings like where we are. Especially for a small time business, local newspapers or bloggers want to hear about the latest Kent gin .They’re all keen to write about it and they notoriously don’t have much to fill their papers with.
E: We’re doing them a favor
S: THis process wouldn’t work so well in much bigger places and it’s a sort of PR that we’re probably going to outgrow at some point but right now it’s working quite well for us. The other side of PR is what, called like PR stunt where we do something potentially outrageous or silly to try and get sort of media attention.
E: Like BrewDog
What sort of PR does Brewdog use? [06:48]
S: Brew dog is a good example they’re constantly doing things to get people to write about them. Whether that is brewing beer while skydiving or any sort of craziness. There’s loads of examples like people who protest their own store opening. Which is something I really like the idea of to create a sort of false outrage to trying to get people to hate their product. There was one writer who wrote a book about picking up women and his marketing strategy was to contact all the feminist groups and try and arrange protests against his new book. So he created a big uproar on one side so that people could disagree with him, and even if they don’t then people will still just come hear about it.
How can outrage be leveraged for success in marketing? [07:20]
S: I always think about blogs and blogging and youtubers and generally if you’re liked by everyone then you’re loved by no one. We’re quite a clanny people. People like outrage, they like, there’s something about being unpleasant that makes people want to write about you or be really polarizing. It’s something I don’t really do on my blog because I quite like being liked by people, but I know if I start having opinions on controversial subjects, not only will I get people writing about me to support me but I also have people writing about me to disagree with me, and all of those people that are disagreeing with me will be inadvertently promoting stuff. Giving me extra SEO, introducing me to their audiences, most of whom have probably never even heard of me.
E: Yeah, but you don’t want to go down that route from a personal perspective.
S: Yeah, but in some ways PR is the most exciting type of marketing. If you have a really good creative idea for a PR stunt, it can translate into something really great.
E: Would you want to talk about the video.
What is content marketing? [09:37]
S: I do but I think there’s the next topic of marketing I want to talk about ,which is content marketing. So I am differentiating slightly between PR and content marketing because content marketing is when you’re creating something, a blog post, video, instagram pages, whatever, you have control over the content vs. PR where you are trying to get other people to write about you. And there is a bit of a crossover, so you can do something with your content marketing which leads to more PR and other people are then writing about you, sort of a classic example of this is stuff that goes viral. Say a video. That you create like a–the example from my experience is from our table tennis business, we created a video of me learning to play table tennis, it was kind of a one second a day video going from a complete beginner to fairly good, and that video did really really well. It was shared by lots of people, it went viral, and it now has over 10 million views and has led to a bunch of other PR. We were on BBC news, a few TV shows, all sorts of newspapers. And also to some extra sales for our table tennis business, and some extra SEO for my own personal blog. But all around, that was something where we created content with the hope that other people would look at it and it would help whatever else we were doing at the time. Another would be my blog where I am trying to produce good quality content that people like and people read but that hopefully will then lead to some sort of marketing for me whether that is someone will go out and buy a bottle of our gin because I have told them you really know in depth how to start a gin business, or someone might sign up something unaffiliated with a commission. Content marketing is something that you’ll see quite regularly basically most articles you see online by any sort of businesses is content marketing . you often have whole teams to do it, they’ll hire people out to create content that keeps people interested. And I’d include social media as well, where one of our directors on Pipehouse Gin is in charge, she takes pictures, does some nice animations under the hope that people will see that and go off and buy our products. Content marketing is one that I think is a bit more wishy washy, it’s not my favorite which you might be surprised about because I have a whole website about that, but you can go viral and the work will be totally worth it, or you can spend two years writing blog posts and no one reads it at all. It is something that could work but it isn’t my favorite it. There is no guarantee. Compared to something like PR, where if you get into a newspaper, that will translate into something good for you because they already have a readership.
How does Sam feel about content marketing? [12:45]
By producing the content yourself when you don’t have leadership, knowing how that’s going to go down is a lot more variable.
E: On that, what do you think it was about the youtube video of you playing table tennis one second a day that made it go viral?
Sam and Emma discuss viral content [13:36]
S: I think it was that it shows what it takes and generally it seems that what it takes is a critical mass of interest in a short period of time. So with that table tennis video, it wasn’t that we slowly got loads of views over a load of time. 9 and a half million of those views happened in over a two year period. But what made it go viral first was a lot of views, probably about 40,000 in the space of a few hours and that kind of trending really pushed it up and then pushed it into a lot of other people’s consciousness. So it reached the front page of reddit, we were on the youtube trending for a while. Then loads of other people picked it up and started promoting it, loads of mainstream media. Which then looked like a long tail of the majority of views that you ended up getting. So there are ways to game this system. There are ways to fund the clap for twitter, where you get a group of people together who support you and then you all tweet about the same hashtag or subject at the same time within a few seconds of each other and that will push you up into the trending section. There are more black hat ways of doing it. Reddit has an up or downvote system, so some hackers create loads of fake accounts and then upvote their own stuff to try and force it, to try and set off the avalanche. But there are people who are experts in creating viral content, knowing a bit about psychology, what people want to see, tweet their interest. The wording, the imagery, the outrage, And you see them all the time. So a recent one I saw is that someone posted that he had got in an uber and the uber driver took him to a baseball game and he had a spare ticket and there were pictures of him in the uber and then gave him the ticket and then they all went and watched a game together. And that went viral, loads of people read about it and loved it, but then it quickly transpired after people did some digging. The guy who created it was a marketing specialist who happened to be working for a company that was hired by uber in order to create viral marketing. There is quite a lot of that going around. And it is the stuff that you can do to your own advantage. It is not something I would really spend much time looking into or doing. But it does work. And again it is kind of thinking creatively outside of the box. Ways in which you can get that interest. I suppose the other way you can have that kind of instant viralness is by already having a large community or audience that you can push out to. Which brings me to our next form of marketing.
What is community building? [16:47]
This is where your focus is on building a loyal fanbase or really selling or really marketing to people who have already heard about you or already are your customers. So now we’ll talk about building an email list and sending out emails. Let’s say you saved the email of everyone who’s bought your product on your online website, and then when you release a new product you send out to all the people on your list. Or you upsell. They buy one thing, and then you send an email about whatever the next step is. Or, if you’re not actually sending something, you could do it the other way around, where you try and get people onto your email list, maybe free content marketing, and then hopefully turn them into loyal customers way down the road. I am also talking about having lots of followers on social media. WIth our instagram post, that is content marketing but it is also community building. We’re trying to get as many followers as possible. Right now, we’re running a giveaway where if you like or share a post, and tag in a friend, then you’ll be entered into a free giveaway for a bottle of gin with the hope that this will be pushed out, people will share it, it will have enough of a spread that we’re now getting more customers and followers and more people who have heard about us basically. Now, community building works really really well if you have the type of product that loyal fan base would be into. Particularly if you are doing something quite creative. Let’s say you’re writing a comic book, or doing an online webcomic, or running a youtube series or writing a blog, all of those things rely on a big community or following, whereas if you’re doing something different like selling table tennis bats, its harder to build a loyal fan base of people who are into your table tennis products
E: Also, it would be harder for them to become a return customer wouldn’t it.
S: It will be harder to make them a loyal customer, and also it’s a game that people love. If you’re cards against humanity and people love your board game and PR stunts, then that builds your customer base. That is not always the case. Some brands have done a really good job of building a loyal fan base. THink about Apple and all their crazy fans. Think about the supreme, the clothing brand, who have hour long queues to buy their stuff. THink about high fashion that has built a loyal fan base that has a value in itself, where people put more value on a brand than they would if it was more generic. I am going to take a slightly different twist with the next one. Let’s talk about events.
What role do events play in marketing? [20:27]
S: WHere I am going with events is more talking about building a presence. Building sort of what people know about your product, on the marketing not on the direct sales. FOr gin, we do market stalls. For one, we’re making money off of them. We’re there, we’re getting sales. But the more important thing is that it brings people to us, it is a kind of free advertising because we’re covering all our costs by selling there, but then we’re also handing out fliers, and everyone sees us as they’re walking past.
E: ANd it also gives us an opportunity to talk to our customers. So some people say that they saw us in the paper and really wanted to buy a bottle. Or i saw you in our local pub and I wanted to come and meet you. Whatever it is, it gives us an opportunity to see what marketing is working.
S: Yeah, and there’s a bit of community building in there as well. They’ve met the makers, and now when they buy a bottle of gin as a present, they’ll buy ours because they have a story. So that’s market stalls. There’s also going to trade shows to meet customers. We’re spending quite a lot of money on a stall and on staff to man it, but then also hoping to build off customers on the back of that. Build publicity for whatever it is you’re selling. Or we can do some market research to see what over stuff is working, what people like about the brand. I’ve also put down here speaking engagements, so talking at conferences. Things like that. And then there is the slightly different side of the events, which is going to other people’s events vs. putting on events yourself. When we launched the gym, we had a launch party where we invited local media and the press and tried to create a bit of a buzz about us in the local area. We had a bit of PR and told local newspapers what was happening.
E: ANd the local bloggers as well. All the amateurs that have really big followings locally.
S: ANd people who are amateur photographers. Instagram photographers as well who can come along and take some nice pictures. THis kind of event marketing is what Emma used to specialize in when she worked at PWC.
Emma describes her specialty within marketing [23:09]
E: Yeah I love it, it is all about meeting customers face to face and having a relationship with them, getting to know them, and then promoting your product or service. It is all about developing relationships rather than a hard core sales.
S: So PWC where obviously what you’re selling is worth millions and millions of pounds, spending quite a lot of money on an event where only us small group of people are coming but are all high value customers, you’re not selling them anything then and there, but you’re hoping to build that relationship and do some marketing to let them know about you. HOpefully that will then translate later into big sales.
E: Yeah, the ultimate goal was always first of all the decision makers turned up to the event and then second of all, we would get a follow up meeting in their office with one of our directors or partners to then have a more formal business conversation rather than a more broader hot topic related conversation or even a personal conversation.
What are direct sales? [24:15]
S: WHich brings me on to the next one. Let’s talk about direct sales, which is when you’re actually speaking to people one on one. So direct sales in what you just said would be your directors coming to your office and then selling something in person. For us, Pipehouse Gin, that is going into local bars and restaurants and trying to get them then and there. Or maybe in the future to place an order with us. That is also going to biggest distributors or supermarkets. Pitching to their buyer team and then hoping they’re going to place a big order. Direct sales works very well for something like Gin, but it doesn’t work well for something like my blog, where for each reader of the blog, I make a very very small amount of money and so actually me talking to everyone, me going and walking the street and trying to get people that I meet randomly to read my blog is not a very good long term marketing business. Whereas on the flipside, if you’re working for PWC, maybe going through and trying to sell directly to the CEO of the top 500 companies in the UK directly might be a very good use of your time. It might be you spend a year and only get one sale, but that sale could be work it. So this is kind of dependent on your business. But where it could work better for smaller business is affiliate based marketing or commission based marketing.
What marketing might work best for smaller business? [25:50]
S: This is where you are getting other people to market your business and you’re paying them to do it through commission. An example could be say pipehouse gin. We could find and influencer through instagram. We could go to them and say, let’s do a deal. If you post about our stuff, we’ll give you a discount code and anyone who uses that code, we’ll give you a commission. Say, 1 or 2 pounds a bottle for any sale that you directly deliver. It is also one of the ways I make money on my blog. A company will come to me and say, you need to talk about our product, talk about it a bit more and any sale you drive to us, we’ll give you a percentage of whatever they’ve done. It is what amazon does quite a lot. I’ll tell you about the microphone we’re using right now for this podcast, and if you go buy it off amazon, I’ll get a bit of commission. Affiliate marketing works well because you don’t have to have any upfront costs. It is all about the cost, the costs are back loaded so you can open up your affiliations to anyone. You can have just a sign up thing on your page and then anyone can sign up and start promoting it. It is also refer a friend deals. If you have a good community, all of your customers could get a refer a friend deal. For everyone else they refer, they will get a bit of money or a bonus.
E: Or a percentage of your product or service.
S: Affiliate marketing works very well for software as a service type business. Business where there isn’t really an upfront cost to the product. IT could work quite well for Pipehouse Gin but we couldn’t get everyone in the world signed up using and promoting it because we can’t deal with that sort of quantity and there’s quite a lot of costs per product that we’re selling. Maybe the commision we can give people probably isn’t really worth their time. Whereas let’s say I have a video course online on how to play table tennis, and everyone who signs up to it pays 100 pounds. It doesn’t matter because it’s just a download and the cost per sale is low to me, so I could afford to give people who are affiliated with me very high commissions, say 50%, which means that suddenly, someone getting to buy a bottle of gin could be worth only 1 pound while getting someone to sign up for the video course could be worth 50 pounds. That is how commission based things work, it is only worth the time of the people you’re getting to do it if you can get them a decent chunk. Next, I am going to talk about business development.
What is business development [29:33]
S: Business development is used to talk about a few different things and often if you find people hiring a business dev manager, what they often mean is just a salesperson. That is not what I am talking about here, I am talking about building relationships with other business where you can do a sort of collaborations or partnerships or joint marketing stuff that benefits both of you, where you coming together, leveraging both of your audiences and communities actually benefits both of you. So this could be, I actually haven’t written down any examples here. Let’s say with my blog. It could be working with another blogger and us both producing a bit of content together and then pushing out to both of our audiences. If you have a youtube channel, it could be having other youtubers onto your channel and doing collaborative videos that hopefully both of your audiences will want to listen to. With your podcast, it could be having guests on that my guests would want to hear from and then combining audiences. Let’s say you have a big brand, it could be partnership deals or Coca Cola or teaming up with someone where they end up building something or creating something that is more than the sum of their parts.
E: And both their followings have a mutual interest.
S: BUsiness development can work very well and come quite naturally just by networking and being friendly and helping out other people in your business or industry. So, for instance, with the gin, because I have written quite frankly about what it takes to start a gin business, quite a few other people who own alcohol business have contacted me just for a chat. Not wanting anything from me, but by talking to them we’re able to share tips, like saying what margin they got with distributors
What are the benefits of talking to other businesses within your market? [31:27]
S: So generally, I think it is a good idea to be on good terms within your industry because you can help each other. It’s not a zero sum game, but generally, by working together, you can grow the market and can benefit both of you.
E: Yeah, you can better both of your businesses.
S: One sort of example of how we’re doing this at the moment with the gin is by going around and doing professional photography at each of the bars. So we’re paying the money it takes to get all of those lovely pictures, and now these pictures, they can use for their own marketing and they can use for our marketing. We don’t need to rent a location to take great pictures and they don’t need to hire a photographer to take great pictures. Alright, let’s talk very quickly about Search Engine Optimization.
What is SEO? [32:30]
This is a bit more specific topic but I have put it up because it is very important, especially if you’re running an online business. And this is about hitting high on the search terms. It is called SEO, but really what I am talking about is whatever platform it is that you want to appear high on. It could be google, youtube, amazon, if we want to appear high when someone searches for gin. SEO is a skill in itself and it is often combined with a bit of content marketing, right in the stuff that you know people want to read and will get people coming back to the website.
E: It’s popular.
S: Yes, it’s popular but it’s also about PR as well. One way to appear high is to have links coming in from other places. These are the only two other things that are important for optimization. You want as many readers and customers as possible because surf engines are quite good at picking up on that. And you want people linking to you.
E: Making you look credible.
S: So let’s talk about biz dev again, what a lot of bloggers do is they’ll get friendly with the other bloggers in their industry and then they’ll link to each other so their combined SEO rankings go up. It is quite important so those are really the two things. You have good content, quality stuff that people want to see and you get as many people as possible going to you and linking to your site. And that is all I am going to see about search engine optimization because it is quite a big topic but is something you should take quite seriously. Onwards, and for the last two that I want to talk about are paid advertising.
Discussion on paid advertising [34:46]
S: So first I’ll talk about general paid advertising and then second, I am going to talk about pay per click advertising. First, with general paid advertising is say I talked to a newspaper, they’ve got an advert section where I can put like a big banner or a picture of our gin or whatever it is we’re trying to sell and get people going onto it. Or yeah. So if your Emma’s Nomad Kitchen or supper clubs, you can put a banner up somewhere and get people coming along. Generally paid advertising is easy to get into because anyone will take your money really to appear on it, versus PR where you are putting it in the same paper but you’re not paying for it, and people know what is and what isn’t and advert, and so will more likely trust the one that isn’t. But it is also hard to track how well it is doing. One of the nice things about most of the other things we talked about is you can very easily see the return on investment for what you’re putting in. Whereas with the paid advert, say you spent 1000 pounds for a paid advert in 10 different newspapers, we don;’t have a good way of tracking whether it was worth it.
E: Yeah, you could do a specific email address just for that ad.
S: Yeah, you can do a different phone number so you can track that way, you can have a discount code so you can track it that way.
E: WHich will help you to decide or how you do that again.
S: But then on the flip side of that is sometimes when you’re doing advertising, you aren’t looking for direct sales. So with advertising what you’ll find that it’s very difficult to track, or if you can find a paid advert that is a direct RoI. Really it is more for the direct promotion of your brand. They say the average person needs to see your brand seven times in order to remember it. So maybe our target is doing market stalls, so maybe doing adverts in a few different papers, so they see paid adverts on facebook that are targeted at people who live locally, and then we have it on the front of shelves in local bars, and I think that is the better way to focus on paid advertising. Especially ones where you are just paying a set amount for a banner, or paying a certain amount for an advertorial. That is where you write a fake article that is really just an advert but it is kind of presented as if it were a normal piece of journalism or a blog. That is one type of paid advertising.
What is the other type of paid advertising? [37:49]
S: The other type is pay per click which you can only really do online. For obvious reasons, because the way it works is you pay per person who clicks on whatever it is and then goes to your website. This sort of advertising is very good for very specific tracking, so you can get a very direct RoI for whatever you’re putting in. And if you get it right it’s amazing because it’s instantly scalable. The more money you put in, as long as you have a formula that works and you’re getting it for a cost per click that you know will turn into sales, you can scale it right up.
E: THe other thing is you can pick a specific audience as well. Whether it’s geography, agenda, or age. You can be selective of your demographic as well.
S: You can if you’re doing it on facebook
E: Or linked in
S: And that is the value in that sort of social media advertising. YOu can also just do general pay per click ads on someone’s blog for instance. You have no idea who the audience is, you just know there are people who paid that blog and that might be the type of audience you’re looking for. Or you’re looking for some keywords and you know what words translate into sales for you/
E: How does it work with Amazon?
S: Amazon is similar. It’s pay per click. It is quite simple, where you target keywords either manually or they have an automated thing where it will sort of look for what people have searched for and then bought your products and then target them. And then what you can do with the automated one is you can go back and then remove key words that aren’t relevant to you. So for instance, with our table tennis bats, with automated advertising, we’ll find that we’re finding search terms that are for tennis bats, or tennis rackets, so we can go back and remove them. Amazon advertising obviously works very well for direct metrics because we go on their platform and then it tells you directly your cost of sale. The percentage of each sale that you’ve spent on advertising. Yeah, we can do that with the gin and the table tennis stuff at the moment. You can build in that sort of direct tracking with facebook adverts, with google adverts as well. Technology is very clever these days so you can track with someone who clicks the link on google. You can track them right through to the shopping cart on your website. If you’re running a restaurant where you want bookings, you can track people going through to your booking form and see how many happened and see how many turned up to see if it was worth it. If you take phone bookings, you can track how many people phoned you based off the advert. You can have a specific phone number in the advert and then have automated software which tracks how that is getting on. Alright, those are my 10 forms of marketing that we got into. We’ve got public relations, content, community building, events, SEO, biz dev, direct sales, affiliate marketing or commission based marketing, page advertising, and paid advertising via pay per click. I know we whizzed through quite quickly and each could be multiple hour long podcast in themselves, so if you have any questions please email me and hopefully at some point I’ll turn them into a really in depth blog post with examples and how to go on each one. So if you have any advice or tips, please email me email@example.com, I would really appreciate it if you could leave me a good review on itunes.
Emma on the catch-22 of running a successful business:
“It is kind of never ending, the more successful it is, the more time you want to spend on it.”
This is a frank and honest discussion that you can eavesdrop on.
Sam: Hello and welcome back to another episode of the lazy entrepreneur. Today we’re going to be doing something slightly different, and you’re basically going to eavesdrop on me and Emma having a conversation about our future, about what we’re going to do with our businesses and what we want to do with our lifestyle, and hopefully it will be interesting. If it’s not, I probably will just delete it. And not put it online. So yeah, we’ll see how it goes. What brought this up is we’re currently living in Tunbridge Wells, which is a very sort of quaint nice town on the outskirts of London. We’ve been here a little over a year, and before this we were travelling full time. We were nomads. We lived out of a suitcase, we had our laptops with us and we were working remotely. And then we decided we wanted a life change, we wanted to be more productive with our businesses. We wanted to have more long term relationships.
Emma: we wanted community, and to be part of a community.
Why did Sam and Emma decide to stop travelling full-time? [1:30]
S: And we wanted to enjoy some of the finer things in life. A nice house, a car, a big bed. A warm shower, all the luxuries. But now we’re getting a bit of wanderlust. Our tenancy is up for renewal in July and we’ve got to decide, do we want to stay here or do we want to go again. Do we want to get rid of all our possessions, get back to living out of a suitcase and travel the world. Originally, I thought this was a bit of a no brainer. Three or four months ago I thought, yea we would like to travel. The stuff we were working on was taking over, the lifestyle was taking over, we want to work on the things we’re interested in and focus on our hobbies. We were doing a lot of yoga and jiu jitsu, but since then we’ve done quite a lot with our brand Pipehouse Gin, a craft gin brand, and it’s got to a point where we’ve got to decide, do we want to go all in on it, do we want it to be huge. Do we want to focus on that for the next few years and try to build that into something spectacular? And if we did that, the best way to do that would be by staying here. It would be by taking on staff, by putting some more money in, either our own or an investment. It would be spending all of our time and energy on that. Not on sight seeing and globe trotting and enjoying ourselves and doing jiu jitsu. And it is quite a difficult decision. It is something we’ve spoken about briefly, but we don’t yet have a decision about what we want to do. So what we’ll hopefully do today is cover some of the pros and cons and see where we get to. We probably won’t end up at a decision today.
E: No not yet.
Sam gives an overview of the episode: What are the pros and cons of living in one place vs. living more nomadically? [03:30]
S: We’ll just talk about what’s good and bad about both lifestyles. So where are you at since our last chat about this Emma?
E: That’s a good question, I think everyday I completely do a 160, 180 and kind of one day I really want to stay and build the pipehouse gin brand, I want a physical location, I want a really big project that I can get stuck into. And then the next day I want to go to Asia and do loads of cooking classes and explore Asian food and improve my skills and also meet new people and kind of get out of the bubble that is Tunbridge Wells with a lot of similar views and a lot similar people. Which means a lot to me. It is something that I really enjoy, and something that I really enjoyed about living in London that I don’t get here. And it is a really hard decision. Both polar opposites.
S: One of the reasons we wanted to go travelling before was we wanted to get out of our comfort zones again. We find it a little bit too comfortable here. We’re having too much fun and not pushing ourselves that much. But that was before we thought about going all in on Pipehouse and making it a big project. And trying to turn that into and pushing our comfort zone in that project.
E: And that was one of the main reasons you wanted to move to Tunbridge Wells, you wanted to be more productive, spend more time doing work rather than sightseeing and focusing on meeting new people and the community element of being a digital nomad.
S: Yeah, because it is really tiring being a digital nomad where you’re constantly moving, you’re always in your accommodation, none of it is as comfortable as you want it to be. You’re having to think about different languages, everything is a bit of work. You always have to be on form, meeting new people, making new friends, you don’t have any of those old friends you can always just mooch about with. And it’s exhausting and it didn’t leave me much energy to focus on my businesses. And also I was working and Ben my business partner lived in Tunbridge Wells and we were kind of working on it together but remotely. Whereas before going for a while we would together for a while every day at an office, we would work from our flats, he’d come around to mine or I’d go to his. And we would actually get a lot more done. It is possible to have a successful business while travelling and that is what we actually have and we have made it happen. But it is very much a lifestyle business. The business is nowhere near reaching its potential.
What do you sacrifice in a business when you run it as a digital nomad? [06:45]
S: The table tennis grand and the blog both never reached the potential they could’ve gone if I went all in on them.
E: WHich is interesting because they’re both very successful. What do you see as them reaching their potential?
S: On one thing, the more successful something is, the more doors are opened for other things that could be done which we’re kind of seeing with the gin at the moment.
E: Yeah and that is kind of never ending, the more successful it is, the more time you want to spend on it.
S: Yeah, and the bigger something can be, it is kind of like with gin, we start off with one product, we’re now about to launch a second product. But the timeline of doing that remotely would be really long. Whereas if we were based somewhere and there are unending products we could release from different spirits to glasses to gift boxes to all sorts of things, then the turn around does just work a lot better when you’re physically there. And same with the table tennis brand, we’re very successful with bats, but that’s not the only thing in table tennis. There are also balls, and tables, and events and all kinds of other things. We were best sellers in the UK but not in the USA so we could really push that and also non-english speaking places. There is kind of, the nice thing about successful business is we get to a point and we got product people where it makes sense financially so were there for scaling it up. It does have its appeal. Same with the blog and the readership is quite small compared to the english speaking world.
E: Is that your target. Wow.
S: I mean the blog is small enough that if you speak to 99.99% of people on the street they would have never heard of it, which means that there are going to be a lot people out there who would probably like reading my stuff but will never ever learn about it. And as its a business model that works and makes quite good money and the people who read it like the stuff. It kind of should be a no brainer that we spend more time producing more content that people like, and also trying to get it out to more people, and building and audience. Same with the table tennis bats. It is a product that people like, it’s doing well. It’s a bestseller in the UK, the margins are good, it’s making money, it’s profitable, we have an investment in it. So it makes sense to scale it up internationally and go to other countries and expand to more products that we can sell to more customers than we already have. All of those things are put on the back burner because there are other things that I wanted to do. We kind of joked maybe like, maybe it was 2014, we were retiring.
E: Well you did.
S: I did, you didn’t really appreciate it.
Sam muses on his retirement [10:08]
S: I would just focus on the stuff I enjoy versus just trying to make the businesses as big and successful as possible. And I quit a business, my most profitable business pretty much over night. Just said that I didn’t want to do it anymore, shut it down.
E: ANd then you had two other businesses that you tried to get rid of the next.
S: Yeah I had other businesses and I tried to spend a long time trying to extricate myself from them. But then I kept doing the table tennis, I started writing the blogs, I thought that would be quite fun, and then we went travelling and focused on self-development, learning new skills, travelling, travelling, seeing the world, meeting new people and living a slightly different type of lifestyle. The problem with that is 20 somethings aren’t meant to retire. We’re not meant to live a life of leisure and I am quite opinionated on that. And I never want to retire and do nothing. I think it is very unhealthy.
E: Yeah, you will always be working.
How have Sam’s views on fulfillment changed over time? [11:26]
S: I want to always work. But what is fulfilling seems to change in my head. At one point it was doing something that makes loads of money, other times it was do stuff that might help people and sort of altruistic. A charity kind of stuff.
E: Yeah, I was going to say that was kind of a big part of travelling for us, realizing that it was actually quite hedonistic and individual. It is sort of about your immediate needs and it wasn’t really about helping other people. There was definitely an element of meeting people for coffee that you’d never met before and then giving them advice, particularly about Amazon FBA which was very good. But everything around that felt like we were being quite selfish.
S: Definitely. Definitely. And to be fair, we’re stilling living that life. On Pipehouse Gin, would we then get a bit more fulfillment from having that. From working really hard on something that is worthwhile.
What did Sam say he would never do again when he sold his coffee shop? [12:58]
S: Maybe. I used to have a coffee shop at one point in time and when I sold it, I was extremely happy. And I said I would never have a physical location based business again. And here we are.
E: And managing people.
S: And managing people. And here we are. Likewise, I had a business that took quite a bit of investment or money and quite a few people and ended up losing money. I found that really stressful and horrible and ended up paying everyone out.
E: Of your own pocket.
S: Of my own pocket. And said that from now on I wanted to do business that we could bootstrap and scale up without investing too much into it, which is what we’ve done with Pipehouse Gin so far. It is profitable already, we’re doing table tennis focused on building sort of profit producing businesses, whereas if you go all in, we’d be focused on producing an equity focused business, which means that it probably won’t make any money or pay us out any money for quite a long time. It might pay like salaries but in terms of paying out profits, it probably won’t happen because we would be reinvesting all of those profits in growth. Which is kind of something we got slightly burned before on. And was very pleased to leave. So it is a bit of a foolish thing for me to be considering. Really trying to turn it into the next international huge alcohol brand. I don’t know, or have all the lessons from the past meant that this time it would be different?
E: Yeah, I suppose a big part of that is being clear between the four of us, being me you, and our other two business partners about what the risks are, what we’re investing, and what we want to get out of it. And being clear about when we can take money out in terms of salary, when we can’t. How much we’re willing to invest and also lose.
E: And going through both scenarios and not just looking at it like oh this is a great opportunity, let’s just run with and not really going through all of the downsides. Which sounds really negative. But I guess those are the lessons learned from previous businesses.
S: Yeah, I mean lots of lessons learned from previous businesses.
E: That’s what your blogs all about.
S: Generally yeah. Yeah, I don’t know I am pretty torn. One other thing that we need to take into account is that the life of a digital nomad is quite a cheap life. Especially if you’re in Asia, you have a very good quality of life for not very much money. And given the state of the business at the moment and investments of money maybe before means you could probably go pretty much indefinitely without having to
E: Scale up any of the current businesses.
What are the risks of doubling down on Pipehouse Gin and building it up? [16:40]
S: Yes, without having to get a job, without putting kind of that four hour work week dream where we don’t really need to spend that much time on anything. And just keep everything ticking along. It doesn’t matter if they drop down quite a bit. Whereas if we go the opposite route and we take on a chunk of savings and we start putting it into a business and start spending money, we start taking on leases or spending a lot of money on new stock or machinery or things like that. And that is a risk. That is a risk that could mean if something goes wrong, we’ll have to go do something else, you might go back to Peter Eating (sp?).
E: You do keep threatening that.
S: I might have to go work at Waitros (sp?).
E: In the freezer section, your favorite ever joke.
S: I am not particularly employable either way. There is a bit of a risk there, but then again we’re 29 so not much of a risk there. We’ve got a lot of time and a lot of productive years ahead. I don’t know.
Emma broaches some questions about the lifestyle that accompanies scaling up Pipehouse Gin [17:31]
E: I guess another thing for me is what does that lifestyle look like if we did stay indefinitely in Tunbridge Wells and focus on the gin business more like a full time job. What does look like in terms of holiday and travel. And what does our working week look like? And for example if we had a location that is quite central in Tunbridge Wells, would we look to do a bar on evenings and weekends? Would we look to do one off events like what we’re doing now, where we kind of schedule our life around say for example in the summer we did a number of weekend markets and events which was quite manageable for us because we didn’t work full time during the week. We could negotiate some rest time on either side of the weekends.
S: So what I kind of would envision as an ideal scenario is something central to Tunbridge Wells, not somewhere people would walk past but somewhere they could walk to to eat that was mainly a distillery packing center warehouse that also had the capacity for people to come in and buy and drink on the premises. What I would envision is that place would then become a destination that we would then generally stay for people to come in would also be somewhere we would have events and tastings, things like that. And then we would also have other services that we could provide such as contract distilling, gin making consultancy for other businesses.
E: So rather than a full time bar, it’s more of a one off
What four categories of staff does Sam envision for a scaled up version of Pipehouse Gin? [20:00]
S: It’s more like, you know those kind of craft beers, breweries that have a little tap room attached to the side. They’re open like one day a week kind of thing, it would be someone that we could have open one day a week and it would still be worth it. What I envision is splitting the business into multiple sections and then hiring people to take over those sections. So I want to build a marketing team, someone who can just focus on targeting as many events as possible throughout the country. I want to have a specific product development team and get a much quicker cycle on producing products. Maybe aim for something like three a month and have people working full time on that. I would want a specific marketing team who do all the online stuff, content marketing, blog posts, business development, PR, that sort of thing. I would want also a business to business sales team. So people whose job it would be to talk directly to bars and restaurants. Talk to distributors. Bigger supermarkets, international exporters and importers. And then on top of that potentially even if there was a bar, bar staff and that kind of thing as well. But those are the categories and I would be keen to get people that I could get to work as partners and excel with them and then build up those four aspects of the business almost independently.
E: So it’s more that actually we would remain in the management team and we would kind of retain a similar role in terms of making decisions and keeping control but in terms of the day to day, running we would hire a team that we would manage.
S: Kind of, but more intense than that. So, for instance, we get in, we find someone who we think will be good doing B2B sales and then for whatever 2 months you would be working with them full time.
E: Yeah, it would have to be a massive training.
S: Training them up, whatever it is, it would not be, the thing about hiring employees is that generally to get the most out of them and have them be useful, you need to be putting in as much work as they are. So if we have people working full time, it is not like I would be, by going for them, what I mean is we would be taking on more than full time jobs. As it were. Back to my advisor days, where, and this is a comparison.
E: Your tech start up.
S: My tech start up while I would be in there before everyone else, opening up and all the staff would come in and work and I would be the last to leave at the end of the day. Looking up and working with them all day everyday.
E: Yeah, I guess that makes sense for the more admin and office based roles. But the market, it makes sense in terms of the training, but the idea would be the team would sort of run it themselves.
Do Sam and Emma ever envision hiring a CEO for Pipehouse Gin? [23:20]
S: Yeah of course, and I am thinking it growing to be quite a big business. You end up having. What would be nice is at the end hiring a CEO who could take a lot of the managing day to day stuff and almost. Well when I talk about building equity based business, I think about a business that has value in itself and the more you are a key person to that business, the less value that it has. So to build a business that is all its own, it has to basically be self sufficient, so building self sufficiency is the long term goal. But that is like a 3, 4, 5 year timeline for that. So yes you’re right, it’s not off with, it’s a lot of training, it’s a lot of hands on. And each part will eventually run itself. But we’re not talking like a 3 month timeline, we’re talking years.
E: Sounds scary.
S: It is scary! It is a very different style.
E: And it is interesting that this has come up now because we have seen so many of your businesses that you promote and want to talk about are hands off. They are working remotely, you’re not spending a huge amount of money, you are spending a huge amount of time.
S: Businesses I generally suggest people do are the ones that are baby steps all the way. So you don’t start by quitting your job and investing all of your life savings and opening a bar. Instead, you spend your evenings doing some things or running pop ups or whatever it is. You start off by not spending much money and once you get some buy in for the first step, you slowly scale up and build up slowly and gradually. In as low risk of a way as possible.
What is the difference between a start-up and a lifestyle business? [25:25]
S: I kind of describe it as the difference between a start-up and a lifestyle business. They say that if a start up is making a profit than something is wrong. They’re not scaling up, they’re not ambitious enough, I think of the sort of silicon valley start up, they’re trying to shoot for the moon.
E: In terms of growth.
S: They’re going to be losing money for years on end, just focusing on getting as big as possible.
E: And that is the business model, that is what everyone does. That is what you work towards. It’s not unusual.
S: No, it’s very legitimate way of doing things but it is also very high risk. It burns for you as well because it’s high intensity and you need to be spending all your time on it, especially if you have investors, they’re invested in you and you are their workhorse but also a smart decision maker. So generally if people are looking to build an income, maybe quite their job, those aren’t good businesses to do, they are the ones you do because you have a passion for whatever the product is. And they wouldn’t take that risk, and then maybe you spend two years and it fails and then you go back to…whatever job you were doing before. Whereas, how we would be doing the gin so far is that we would be putting in a bit of money, we’ve got our stuff going, we’ve got our first product out, we’ve got buy in from that, we then took out a bit of money as it was making some profit, and we’re putting a bit more back in to launch our next product. But we know that we’re slowly scaling up our order sizes, our print runs for labels and things like that. Because we know now that we are going too soon, we’re taking very baby steps at the moment.
E: That is the next thing I was going to say, I think it is quite interesting to discuss how we were running so far, which is organically, and making business decisions that we’re comfortable with, not necessarily being very risky or giving kind of a responsibility or some control to outside people. I think that is going to be a big part of the decision process for us as a team because that is going to be really out of our comfort zone.
S: And this is something we’re just talking about together, because if we stay, the reason to stay would be because we wanted to go all in on something, and it might be that Ben and Katie are the other partners and they actually really enjoy as it is and we’re growing slowly, the day to day stuff, they’re enjoying the amount of time that we spend doing the events or whatever the focus is is manageable with their commitments because it’s all very well saying that we’re going to stay and focus on it but it’s actually true that they have a busy schedule as it is.
S: And it suits us because we’ve got other businesses but so do they. Table tennis for me, and also they’re studying at Bible College and they’re very involved at the Church and Ben is also doing table tennis coaching and he’s writing his blog and he’s doing art and food photography stuff. So at the moment it is very chilled and we can do a lot of things.
E: And they would have to sacrifice things, we’re talking about a sacrifice of not going travelling but it’s also the sacrifice of
S: Well we would be asking them to give the same commitment that we would. But before we ask them that, we wonder if that’s what we want ourselves. Because if we don’t want it, there is no point in raising it.
E: And actually the ultimate goal of selling the gin business in five years time and have it be worth x amount is our goal, but it might not necessarily be theirs.
Emma and Sam talk about their goals for Pipehouse Gin [29:51]
S: I don’t think that necessarily is our goal either. The goal is to build equity in the business, build the business to be worth a certain amount, but that has value in itself, it has equity because it is a good business, so it might be that we’re at a point where can sell it but we don’t want to because we’re enjoying it and we’re loving the business. Or it might be that we want to sell it and then go do something completely different. Talk about facebook, the people that want to buy facebook are giving really good deals but he didn’t want to because he said something like, if I wasn’t doing this I would just start another one. He is doing the job he wants to do. And that is kind of where we’re at thinking. What do we want to be doing with our lives, our time? Our 9-5, or 8-8, or whatever it is. What do we want to with our time?
E: That is a good question isn’t it.
S: I was thinking in the shower, what if I want to go full time in jiu jitsu for 6 months, try to get into the europeans, trying to focus on that and forget completely on this sort of stuff. Maybe I don’t, maybe you want to go and study more cooking stuff, go to Cordon Bleu or something like that.
E: I’d love to.
S: You’d love to, yeah? Would you love to do that?
E: Well yeah. I’d love to.
S: Instead of going to Asia, or going travelling?
E: I guess I always thought of going to Asia and travelling as an opportunity to have more time to do cooking classes. So the reason I don’t do it here is because of the price.
E: Not really because of the time.
E: Because I could definitely study full time at cooking class and still do the gin stuff outside of that, as I am currently, as it is currently. I mean I’d struggle if it was something where were doing a lot of physical events as well as studying during the week, but we’re in the winter so we haven’t committed to a huge amount of it.
S: Yeah, I think it is worth saying that us going travelling doesn’t mean gin ends. It just means it continues at the pace that it is going now.
E: Which is manageable to do remotely.
S: Especially with Ben and Katie still here. And we could always go back later in a few years and then go off.
E: I think it is a good point because I see traveling as a sort of passive development, and doing things that are out of my comfort zone and new, and I kind of see staying here as the opposite. But actually, I can do that stuff here.
S: You can do that stuff here, and bear in mind, if we went all in on the business, that would be a lot of hours out of our own personal development, getting used to managing people, working full time, taking on apprentices, whatever it is, we’re having a big life change in July is just…maybe there is a third option, maybe we move to Paris and you go to Cordon Bleu and learn french and wear a cool hat. Make macaroons.
E: Why would we go to Paris?
S: It’s in Paris isn’t it?
E: Yeah but there’s one in every country. We could go to Mexico City, as it’s the cheapest place, but I’d need to work on my spanish first.
S: Well, unfortunately we haven’t come to any conclusions, so sorry if you listened to this hoping we’d decide on our future at this point.
E: I’ve learned a few things.
S: It’s always good to chat through this sort of stuff and then hopefully we can each go away, think about it more and then chat about it again. Maybe you will have a completely different idea. Maybe this will inspire us to think of something completely different that we want to do and go do that. Maybe I’ll become a racecar driver. On that note, thanks for listening and this has been the lazy entrepreneur, I am Sam Priestley and I have been here with my lovely wife Emma. If you want to get in touch with me you can find me at sampriestley.com or email me at firstname.lastname@example.org.
Sam on finding business partners:
“You should be very, very, very, snobby about who you get into business with because the skill set of someone who makes a good entrepreneur is quite small. You need someone who is self-disciplined, creative, courageous, and you need someone who works well with you. To find that person is very difficult.”
In this episode of The Lazy Entrepreneur Podcast, Sam and Emma discuss the pros and cons of starting a business on your own vs with partners.
Emma describes her experience with Pipehouse Gin [02:42]Emma talks about having business partners vs. being a solo owner [03:27]How is Pipehouse Gin structured? [04:57]If Sam had started Pipehouse Gin alone, how would that have changed the product? [05:37]
What are the advantages of working with partners? [06:58]
How does Emma feel about running one of the “less-fun” parts of Pipehouse Gin? [09:15]
What are some benefits you get with partners that you don’t get when you contract work out? [12:18]How does having partners in business benefit your well-being? [15:37]
What are the disadvantages to working with partners? [18:46]How do businesses with partners break down? [21:17]Thoughts on working with the same partner on multiple businesses [24:03]Further discussion on the disadvantages of working with partners [28:17]The difficulty of finding a work-life balance as an entrepreneur [32:56]
Sam: Hello and welcome back to another episode of the lazy entrepreneur. Today i am going to be doing something a little bit different from the other two episodes and I’ve got emma my wife here with me. Say hello emma.
S: what I’ve found doing the other two episodes is sitting in front of a microphone and talking is pretty difficult. It’s much more difficult than it looks. It turned out I wasn’t very good at it and came off a bit wooden. And although I think the content of the two episodes was good, the delivery was pretty flat and it took me quite a long time to do it, and possibly worse, is that I’ve been putting off doing another episode ever since because it is difficult. So after a few suggestions and few emails from readers and listeners, having someone else to bounce ideas off and chat things through and make things flow a little bit better. Let’s try it, let me know what you think.
S: So today we’re going to be talking about partnering with other people when starting a business. So Emma is here because she is both my partner in life but also in business. And we run the business pipehouse gin together, which we’re doing with another couple. Pretty much all of the businesses that I’ve started I’ve done with other people. The one exception being my blog and consulting business. But the rest of them I have either done with one other person or two or three other people. With varying success. I’ve had ones where having a partner definitely made it better and together were more than the sum of our parts with the different skills that we brought to the table and it ended up being worth far more than if we’d do stuff on our own. And i had other business where there was a real imbalance on the amount of work that people were putting in where things grind to a halt because decision making takes ages. And then I’ve also had ones where partners had fallen out and turned what was quite a successful business into one that had to close down. So it’s not an easy question to answer. It’s not easy whether to answer it’s always better to do a business together or just yourself. So that’s what we’re going to talk about today. So Emma, how are you finding Pipehouse Gin?
Emma describes her experience with Pipehouse Gin [02:42]
Emma: I’m quite enjoying, I like that the product is very exciting for me. And doing it with friends and family has been quite a journey (laughs).
S: I’ll take that as both good and bad.
S: So you’ve actually got another business that you do yourself. Pipehouse Gin is a self-explanatory Gin Business, but Emma also runs another business that she does herself called Emma’s Nomad Kitchen where she does supper clubs. She invites people into our home, cooks a three course dinner, and charges them for a mini restaurant that happens every couple of weeks. So have you found that to be quite a different experience, working with other people vs. having all the power and control yourself?
Emma talks about having business partners vs. being a solo owner [03:27]
Emma: Yea definitely, I think at certain phases of Emma’s Nomad Kitchen, I relied on you quite a lot in terms of brainstorming ideas and in terms of the logo and the name and in terms of how I set up the business on the commercial side. So in some sense we kind of worked together on that, but the day to day running of the business was 100% me and I love that because I have complete control and creativity over how often I run the supper clubs, the menu, and the people that come along so yea I really enjoy that and actually reflecting back on Pipehouse Gin vs. Emma’s Nomad Kitchen, I’ve really enjoyed having my own business alongside a business that we’ve been working on with other people because there are decisions that I can make instantly and I have control which I’ve really enjoyed.
S: Yeah I can see that. I mean that’s one of the biggest issues with owning a business and then having partners, especially if it’s your baby, you’re giving up control of it. Especially if it’s an even business where you’re taking an even share, which is how all my businesses have been done, it is possible for one person to have overall control and then a bunch of partners. But if anything I think that makes it even more complicated.
How is Pipehouse Gin structured? [04:57]
So with Pipehouse Gin, there are four of us, four decision makers. We have a meeting once a week, which we sometimes miss, so sometimes it can be two weeks where kind of all the decisions get made. And that can really slow things down. Especially if we get to a meeting and find that we can’t reach a decision at that point, we get our way of thinking about it and come back again in a week or in two weeks and try to make that decision. We started Pipehouse Gin in september 2017, so just over a year ago, and we launched our first product in June. Now if I had been doing that on my own, would the product have been out a lot quicker?
If Sam had started Pipehouse Gin alone, how would that have changed the product? [05:37]
E: Yes! Definitely.
S: YOu think it would be?
E: But it would have been a very different product;
S: I Think so too. It would have been a different and much worse product. This is one of the advantages of having partners that you have different skill sets that balance out each other. And just because something is slower does not mean that it’s worse. I’ve quite a good enough attitude to products, design, business, where I value sort of speed and getting stuff out there over polish and quality. As you can see with these podcasts where I am trying to crank them out as soon as possible whereas some of our other partners, like Katie who was an art teacher before doing this business is the complete opposite. She is a 100% perfectionist, and if she was doing it on her own, the product would have never been released. If I was doing it on my own, the product would have been released very quickly and would not have been as good. And then kind of bashing heads a bit, we’re able to get something that actually has both really good polish and which we…
E: And is commercial.
What are the advantages of working with partners? [06:58]
S: Yea and actually have a product that made it out there. So let me talk a little bit about the advantages of working with partners and how they kind of work for me. So the first one I put down is accountability. It’s the lazy entrepreneur and I call that because I struggle with motivation. I need to be excited about something in order to get up in the morning and go and do it, but on the other side of that, I am also a people pleaser. I don’t like letting people down, so by having a partner that I make promises to, like I will have this done by this date, even if I’m not feeling like it, I’ll get up and go out and do it. So accountability is quite a big thing. Even just having the accountability, like I know we have a meeting once a week, if it was “plan a new meeting when you feel like it,” we’d probably never meet. But it’s once a week and everyone knows its happening and Emma books it in my diary without telling me and so I turn up in the morning and you’ve got a pot of coffee and about half way through I am really into it.
E: Once you’ve woken up.
S: So accountability is a big thing. But for you maybe that isn’t such a big point because you are quite self motivated already. With Emma’s Nomad Kitchen, it doesn’t take much for you to spend a few days planning recipes and trying out new things in the kitchen and doing all the preparation. I have never seen you putting it off, that is for sure.
E: Yea definitely, that is because I really enjoy it. I think that there is only one element to it that I hate doing, which is ironing the napkins. And that is the thing I put off all week. So I think that shows how much I enjoy the whole business because I always make time to do it and I enjoy doing it.
S: So what about with Pipehouse Gin, because you’ve got one of the less fun roles in Pipehouse, where you are responsible for emails and following up with people, chasing them and paying invoices. YOu are responsible for a lof the sales, going around to bars and restaurants, flirting with the barmen, trying to get them to buy the gin.
E: Is that what you think I do?
How does Emma feel about running one of the “less-fun” parts of Pipehouse Gin? [09:15]
S: What about with that?
E: Well I really am a people person so I like meeting new people and building relationships, so whether it’s through emails or in person, I enjoy meeting people in the food and drink business. And also that is part of the business that I really enjoy. So to you, although it looks like I spent loads of time doing admin, chasing people down ,emailing them , I really enjoy the end result and I think I am quite good at the admin side of it. So it’s something that I just run with really.
S: Another advantage of doing business with partners is that you have different skill sets, especially if you pick your partners wisely, then you end up with a really good sort of team. Which I think we’ve proved with Pipehouse Gin. We’ve got Katie who is a designer and artist, who’s taking the photos and doing most of the photos and branding and runs our instagram account. We have Emma, who is very motivated, puts in tons of hours, probably double what the rest of us put together all do, is very good at staying on top of the emails, going out there and meeting people, doing all the stuff which, say, Katie and me, who are much more introverted would find torturous. Going and walking into a strange restaurant and asking to speak to the manager and trying to convince them to buy our gin. I would find that really difficult.
E: Yea and then I try and convince Sam to take me back for dinner.
S: Yea you find all the best places don’t you.
S: Whereas me and Ben, we’re quite good at strategizing, bigger picture stuff, we’re also very just go and do it. So we both have a history of starting lots of different businesses and have a lot of experience with all the minutate and the financial side of this whole thing. And I think this works quite well and I think it’s better than anything any one of us could have created on our own.
E: And I think a good example of that is the numbers. Whenever there is something with numbers, you and Ben are pouring over it, and me and Katie are kind of like half asleep, half talking about something else. But that’s the good thing about working in a four, that actually me and Katie don’t need to understand the real detail of the numbers, obviously we need to understand the headlines, but that’s the good thing about working in a team.
What are some benefits you get with partners that you don’t get when you contract work out? [12:18]
S: And one argument people use is that you could hire people to do these roles, but the nice thing about having a partner is that they are invested in the business. They have as much buy in as you. If you have to hire an accountant and speak to them every time you’re going through numbers, not only would it cost a fortune, but how would you know if you’re getting good advice? If you don’t have a good starting point…they’re not invested, they kind of are but they’re more invested in getting their fee. They’re not so invested in having their business work out. I’ve spent a lot of time looking at spreadsheets, thinking about how we could change the margins and save money or whatever, and likewise, if you hire a designer, you get some quick cheap designs churned out quickly, or you get Katie who spends hours thinking about and working on and trying different designs and taking pictures and learning and doing research about what the best most affordable photo sets are for the business and all that kind of stuff.
E: Well yeah, she’s taught herself to be a food and drink photographer int he past year, which is not a skill set she had before.
S: ANd if you had to hire someone to do that all the time… so one of the things we do at Pipehouse Gin is we have bars that stock our Gin, we’ll go around and photograph in there so we get some good marketing stuff that they can use and that we can use and if you had to pay a photographer every time you did that it just wouldn’t be worth it… it would cost a fortune. But she is invested in it. And yeah we could hire a salesperson to go around to each of the bars and restaurants, but again, you have buy in when you talk to them. When you talk to them they know you’re an owner, that it is your baby, they’re much more likely to buy because they’re supporting you and a local business as opposed to just some rep coming around. And as we expand, if we get to some point where we’re hiring other sales people, you will have done it yourself, so you can train them out, you can go and monitor them, whereas if you’re just hiring a sales guy out of nowhere, how do you know they’ll do a good job? You don’t have a benchmark for what they’re meant to be doing.
S: And another advantage is you have people to bounce ideas off. So I think of myself as quite an ideasy sort of person, I am quite creative. But some of my best ideas come when chatting to people, when I have someone to rant at and talk about my ideas and they can give a little comment and that will make me think of something else, and then they will, and then together we’ll come up with a better idea than I would have come up with on my own. And I just find that when talking with other people about ideas and the exciting stuff we can do with the business, it just makes me more excited and means that I’ll go away and then think about more things on my own or have that motivation to do other stuff.
How does having partners in business benefit your well-being? [15:37]
S: So these are kind of the three, really practical reasons to do business with partners. I’ve got another two which are more kind of for your own welfare. So the other thing is if you’re self-employed you spend a lot of time on your own. Spending all day every day on your own working hard with your face buried in a laptop is not good for you, it is not fun.
E: And it’s not very productive
S: And it’s not very productingge. Whereas if you’re doing business with friends and partners, it just makes everything more fun. Having people to talk to. We’re social animals, I think it’s just a good thing. Before Emma was doing Pipehouse Gin and Nomad Kitchen, she was doing freelance marketing and you found sitting there writing proposals all day on your own torturous.
S: And I found it difficult as well because I’d be in the zone working and you’d always be trying to talk to me.
E: Yes because I like to chat when I work.
S: Yeah, which is fine if we’re working on the same thing and the chat is work related but when I’m doing something completely different and I keep getting interrupted, it doesn’t really work and you enjoy it very much because you were doing something that wasn’t too fun anyway.
E: Well I think that the business was for money, not because I enjoyed it.
S: That is true.
E: And I think that’s the biggest difference from Pipehouse Gin and Emma’s Nomad Kitchen. I love doing both of them. Whereas marketing was just a means to an end.
S: That is very true, and I suppose, one advantage we have is that we’re both self-employed, so we’re married and we live together and we spend all day together. Whereas if you live on your own, or if you’re married and your spouse works, then you’ll spend all day on your own. Which would drive me crazy.
E: It would drive me crazy.
S: So before we married and before we met, I was self-employed and lived with friends who I was doing business with, so I was never in a situation… I don’t need much human interaction, but if I was on my own all the time, I would. And I think I’d find that quite tough. So we talked about some of the advantages, and we have a list of five there, accountability, different skill sets, people to bounce stuff off, lonely if you’re on your own, and its more fun with friends. Let’s talk about my much longer list of the disadvantages.
What are the disadvantages to working with partners? [18:46]
So the first one I want to talk about, which I think is probably the most important in terms of if you don’t understand this going in, then you’re going to find working with partners very very difficult. And that is that there is always going to be some sort of imbalance in contribution to the business. And contribution to the business can come in many different formats, that can be kind of hours put in. Someone is almost certainly going to be putting in more hours than other people, even though they share the same amount of business, they share the same reward. There is always going to be someone who came up with the original idea who might have thought of that great new thing you could do which turns out big and really successful. There’s always going to be someone who is responsible for more of the sales, more of the revenue. Who’s brought in the business, and without them, the business wouldn’t be where it was. And there is always going to be an imbalance in contribution from a success point of view. You’re all doing different parts of the business, and you spend a lot of time working on it and it goes nowhere. But on the other side, someone is putting in the same amount of work and effort and actually succeeded. And because there are all these different types of contribution that you’re talking about, you’ll almost certainly end up in a situation where each of you are thinking of a different person when thinking about who is contributing the most. That one of you thinks this person, maybe yourself, maybe you think that “I have put in so many hours, I worked so hard, they’re lazing around,” that might be what you’re thinking.
S: Whereas, the other person might be thinking, “ Well I came up with the original idea, I thought of that, I had that one contract that made our biggest contract that made the most amount of money, and that could lead to a lot of resentment. And I think people getting bitter over contribution differences in partnership is where a lot of people end up falling down. Which should happen in many different ways.
How do businesses with partners break down? [21:17]
So one way it could happen is that you get resentful because you think you’re contributing more so you start putting in less work. You try and even that imbalance by doing less which, as you can imagine, is a slippery slope. It means the business will do worse, which is worse for all of you. It means other people will see that you’re putting in less work and then they might follow suit and put in less work, they might get bitter towards you. They might think they’re the bigger contributor or whatever. So, the reason I have highlighted it is to show there is always going to be some type of imbalance, but that isn’t always a bad thing. That is one of the unique points about a business that you’re doing with partners. Is that you’re all doing different roles and you’re all contributing a different amount. Yes, if you have an imbalance where one person is doing all of the work and the other person just never turns up to the office, that is an issue. But that is not really what I’m talking about. I’m talking about where you’re all working at it and some people feel they’re doing more than others. I don’t really have a good solution to this problem. But that’s just to say that’s how it works, that is what business is like and you have to get over it. It shouldn’t affect how much work you’re putting in. It’s something that’s better to talk about than to try to resolve yourself. But either way, you need to be aware. It’s never going to be 100% fair. Especially when we’re doing a business… One thing we might find is if you’ve had success with one partner in one business, you’ll probably go into business with them again, which case in point is Ben who is Katie’s wife who we’re doing Pipehouse Gin with. So we have three different businesses that we work on together where we’re partners in and we’re together, some businesses I do more work on, some he does more work on, but when I set back and look at the entire picture, yeah we’re all contributing quite a lot to those businesses.
Thoughts on working with the same partner on multiple businesses [24:03]
And I think that even if I went back and got out my excel spreadsheet and calculated contribution amounts, I might find an imbalance somewhere, but then maybe in three years time we would have done something else or one day I thought I was doing work, at this point in time I might go through something in my life which meant that I wasn’t able to contribute as much. I know that is not going to stop him putting on 100% effort towards businesses. So maybe in three years that imbalance shifted totally the other way. As long as you’re partnered with the right people and you know they’re all committed to the business, if there are these slight imbalances, just get over it and get on with it.
E: So one way we look at contributions in Pipehouse is we look at the numbers that matter to us, say we’ve just started looking at sales per channel. So website, events, trade, and events was something over the summer that all four us focused on, and we were really competitive in terms of sales, because we tended to split the events couple by couple. So you and ben loved comparing how many sales we’d get from that day versus that day. For us, the actual sales of bottles, the results, was kind of how we measured contribution.
S: So moving on, another issue if you’re someone like me, if you’re in a partnership you don’t have full control over the business. If you have an idea, and someone disagrees, you can’t just go ahead and do it. Now I like having an idea and acting on it. And I find it difficult especially if I disagree with people, if I’m being told no. I found this most difficult when I was running a coffee shop. A coffee shop I had a partner, so it was two of us running it, but we also had a general manager who was responsible for day to day stuff. And kind of implementing decisions. And I found that it is very difficult to, because I would often have an idea of something that I wanted to do or a new product line and found it difficult to get buy in from the other people to commit to that. Whereas in something like my blog, which is down to me, if I want to change something on the businesses, or do a complete redesign, yes I can just go and do that that day. So I find that difficult, but we’ve kind of already covered it slightly. Not having control can be a good thing. Especially if you got something like Pipehouse Gin where the brand matters a lot. How it looks matters a lot. If it was just up to me, and I could just say one thing we found quite frustrating when we started was that Katie would not let us, or didn’t want us posting on instagram. And that is because she had a very high level view of what she wanted it to look like. Color schemes, she had a very high quality benchmark for posts. Whereas we were thinking we were at the market, we want people to come down. Let’s just take a quick photo and put it up on instagram. I found that quite frustrating to begin with, and now that we’re a few months later and I can see the bigger picture and where she’s coming from, it was definitely the right decision. If you’re doing your own business, you’d find it really annoying if you had to run your recipe idea through someone else before you could go ahead and make them. It would drive you mad. If I had to get agreement for every blog post I published on my site, it would drive me mad. But on Pipehouse Gin it works quite well. I think it depends on your business.
Further discussion on the disadvantages of working with partners [28:17]
S: So let’s talk about the problem of working with friends and family, is it could put a real strain on those relationships. We’ll be out at a romantic meal and just talking about business related stuff.
E: Which is your dream.
S: Which is something I really enjoy that Emma is coming around to. If your business is going well and things are fine, the problems come when your business starts going badly. If it starts to put a financial pressure on you and it starts building resentment between each other, and I have seen a lot of people that got into business together or as best friends and now don’t really speak to each other or become quite cold. You do hear quite a lot of stories about marriages breaking down because people have gone into business together. So it’s not something you should take lightly. I think we took it together pretty casually. And I am not regretting it, not yet.
E: But I think the part of that for us is that we are not financially dependent on this business succeeding.
S: That is very true. Yeah, and the way we’re treating this business is very much we’re doing it because we enjoy it not because we want to make millions.
E: That would be a bonus.
S: BUt we’re not planning on taking on an investment or loans or mortgaging our house to pay for it. We’re not planning on using our non-existing kids college funds to fund it.
E: And all those things are very stressful.
S: We’re purposefully building a business as least-stressful as possible. Which is kind of the cause of a bumpy experience of doing it the other way.
E: And I think the other way we approach the business is to learn different skills, improve on the things we know we are already good at. It does seem, I guess when I put it like that, more of a hobby business.
S: Yeah, so a low stress business. A lifestyle business that we enjoy doing. But I think that even if you’re not officially a partner in the business with your spouse or partner, becoming an entrepreneur and committing yourself to starting your own business is going to put a lot of strain on that relationship anyway. Even you might try to insulate them from direct involvement in the business. It is going to have an impact. You met for lunch with someone yesterday where you were talking about how you know when not to disturb your husband.
E: When you’re in zone, don’t try and break up your workflow. But that took a number of years and quite intense travelling where the two of us kind of spent a lot of time together when we were travelling the world and that was one of the lessons I learned, to get to know the ebbs and flows.
S: If you’re both working 9-5 jobs, that when you’re not at work, that is kind of you time. Whereas Saturday, if there’s something I need to do, I’ll kind of be working on that. If it’s 1 am and I just got into the zone and I am really being productive, I’ll keep doing it. When things are going bad, I don’t really want to go into it. But the last month has been very stressful, and you have been getting a bit of the brunt of that. When I am moody or don’t want to talk or playing bad tempered, and the effect you had on it as well. And affecting your health, yeah. Stress is not good for you. Stress does seep onto the outside world. Especially when your business is you. There isn’t really a work life balance. You can try to build it in but it’s difficult.
The difficulty of finding a work-life balance as an entrepreneur [32:56]
S: You could go for a meal and end up chatting about gin stuff, or when we’re on holiday a few weeks ago, Emma was always checking email because we were getting you orders and I was having to look on through our fulfillment center so I’d ship out the gin to people. So you’re kind of never really off, and that does put pressure on your relationships. All right, I’ve got one last downside to having a partnership, and that is that every person you add to your business means a smaller share that goes to you.
S: So if you 100% own your business, all the money earned goes straight to my pocket. On another business, where I’ve been a third partner. If the business makes 100,000 pounds, I’ll get 33,000, or 25 after the government takes their cut. Each person you add in as a partner adds complexity, slows it down, gives you less control, and means that any money it makes goes further. So I spoke that often you get a case where partnering up with people means that you produce more tan you would have done individually. BUt it also means that you should be weary about growing your partnership too fast. Two is okay, three of you, your portion is getting smaller, four is getting even smaller still. And each person you add, slow decision making, lack of control, buy in from everyone to make decisions, grows bigger and kind of the advantages get a little bit smaller. Alright, well I think that’s it, we’ve talked a lot about the advantages and disadvantages, so it’s solo with having partners. So what I want to leave this on is not a conclusive partnership, I think it really matters about who is your partner and how you work together, and what your relationship is like. The more I’ve done business, the more hesitant I’ve gotten of jumping into a business with someone, and the pool of people I’d be willing to go into business with has gotten smaller and smaller. You should be very, very, very, snobby about who you get into business with because the skill set of someone who makes a good entrepreneur is quite small. You need someone who is self-disciplined, creative, courageous, and you need someone who works well with you. To find that person is very difficult. So if you got someone like that, hold on to them. Lots of the business I have are crossovers with people that I’ve worked with before. If business is good, I’ll talk to them about the next business I want to start. I often see people posting on forums, “I’m looking for a partner in this business.” I think it could work out, but it is quite risky. I think one of the really stringent. It would be better to go alone than to start with the wrong partner. If it goes wrong, that could be the end of the business. If it goes really wrong, it could be even worse than that. I met someone at a conference last year who was telling me he started a business and his partner went into a bank account and stole the money and he ended up in a 10 year long legal battle to reclaim it, and all that time he was having to still work in the business, on his own, and pretend that him and his partner were all fine. Pretend to clients that there was no issue, that all this time he was spending thousands and thousands on legal fees, just trying to sort out a bad decision he made about who to go into business with. So on that depressing note…
E: You can’t leave it there!
S: On a good note, I will say that my net benefit has definitely been on the side of going into business with partners. I would not be where I am today if I had not gone into business with partners and had just tried to do it all my own. And let’s leave it there.
Sam on working as a freelancer:
“If you try and market yourself as the cheapest in field, you’re going to fail. There is always someone willing to do it for less money than you. Instead, you need to narrow it down, find a niche, and scale up.”
In this episode of The Lazy Entrepreneur Podcast, we go over the popular types of businesses that people are starting successful in 2018. From Amazon FBA to Instragraming. From Freelancing to Online Courses. Struggling for inspiration or ideas? This is the episode for you.
This episode of The Lazy Entrepreneur Podcast was turned into a full on massive blog post here: Businesses You Can Start In 2018
What is the main purpose of this episode? [00:49]What are the five types of businesses you can start? [01:28]Physical product brands [03:20]What are the two businesses that enable small business ventures to be successful? [04:49]What role does quality play in building your brand? [07:41]What are Sam’s own product based businesses? [08:53]Service based businesses [11:11]How do you freelance without preexisting hard skills? [13:55]
What are the disadvantages of a service based business? [15:48]
Entertainment based businesses [16:58]Education based businesses [20:00]What two ways can you go when starting this type of business? [21:55]
Opportunity based businesses [23:30]Does Sam recommend matched betting? [27:44]
Hello and welcome back to another episode of the Lazy Entrepreneur. I am your host, Sam Priestley, and in the last episode we looked at how you take an idea and turn it into a business. Well in case you don’t yet have an idea, in this episode, what I am going to try and do is cover a few of the more popular businesses that people are launching in 2018, and hopefully I will give you a little bit of inspiration that maybe you can then take and turn into your own original idea and then turn into a proper business. Now we’re going to blitz through quite a few different types of businesses and I am going to go very quickly so apologies for that. There is quite a bit of choice out there and I don’t want to delve too much into the nitty gritty of the mechanics about how these different businesses work.
What is the main purpose of this episode? [00:49]
Remember the main purpose of this episode is to give you some inspiration and let you know what’s possible. I am not going to talk about every type of business that you could possibly start. I am going to limit it down a bit to ones that you can do with just yourself, a computer, and an internet connection. That means that there isn’t a big barrier to entry, it’s sort of location independent, you can do it from anywhere, running your business from Africa or USA or here in the UK like me. And also means that you don’t need to have a big staff in order to get going.
So i’ll split these businesses into five different types.
What are the five types of businesses you can start? [01:28]
The first one is a physical product brand. Those are anything that you can really hold in your hand. Something where you end up with a final product that has your branding or that is unique to you.
The second one is a service-based business. These are ones where you are offering a service to another person or business. Think about anything from accounting to web design to legal help, writing, translating, anything like that.
The third one is entertainment businesses. These are anything where you’re creating something that is solely for someone else’s entertainment. So i’m talking about stand up comedy, videos, film, i’m talking about novels, video games.
The fourth one is education based businesses. These are ones where you’re trying to teach someone something that is of use to them. So for instance, this podcast is an education based business. Consider an online course where you teach someone french or perhaps a series of youtube videos going into the formation rise and fall of the roman empire.
The last type of business we’re going to try and look at is called opportunity based business. Also called arbitrage business. Where you’re really just looking for an opportunity in the marketplace and making money from it. So this is stuff like buying something cheaply in china and reselling it in your country. These aren’t really industry defined subcategories, they’re just something that I’ve come up with to define the types of businesses that you could start.
There are advantages, there are pro cons that we’ll stop looking at them a bit more as we get more.
Physical product brands [03:20]
How on earth do you run this sort of business from just your sort of computer? The way to do it is to outsource every step of the process that requires touching or dealing with the physical item. For instance, you can design it on your computer or hire someone to design the project. You can then go and find a factory, somewhere like China or a bit closer to home and you can then find another company to quality check the product and make sure they’re up to your standards. You can then get another company who will organize the shipping for you and take it from wherever it has been made to where you’re going to sell it. You can then use another company to handle your fulfillment, such as Amazon’s fulfillment by Amazon’s systems. Or one of many other hundreds of fulfilment companies. And then you can sell on directly to other businesses or distributors such as physical shops or have your own online store or e-commerce store or use other sites such as Amazon or eBay to sell online. Companies have been building these types of logistic networks for decades probably even centuries, but it’s only really in the last few years that they’ve become both accessible and also popular for people like us to use. Small time one-man or small-team businesses. That is largely because of two businesses, both of which you might well have heard of.
What are the two businesses that enable small business ventures to be successful? [04:49]
One of them is Amazon FBA and the other is Alibaba. Alibaba is an online marketplace touched directly with hundreds of factories around the world, particularly in places like China and India where the cost of producing goods is low, and you can work with them to create your own private label products. And by private label I am talking about anything from just slapping your brand on a generic product that they’re already making to inventing something completely new and designing it with them. Whereas once upon a time you’d either have to travel to these countries to find the factory or you’d have to go to one nearby which needed a really large minimum order. Now you can deal with these small time factories all of which are competing for your business and are willing to create you your first product for just a few hundred pounds. And Amazon FBA is the logistics network behind Amazon. It is a series of warehouses that us as sellers and small businesses can use. We can send in our products in bulk to their warehouses and then whenever an order comes through on Amazon or on our own website, Amazon will process the order, go to the warehouse, pick it out, and then send it out for delivery. Fulfillment networks like this aren’t a new thing, but the ones that don’t have a minimum order or a large monthly fee and have easy web interfaces are few and far between. So by combining these two services, easy to find factories with cheap and small minimum orders, and then easy to use distribution network with low minimum order requirements, it means that small businesses can start and launch their own brands very cheaply and with just one or two people on the team. Both of these services have picked up a bit of a reputation as being, maybe not scamming, but definitely a get-rich-quick scheme. Please do not look at them like that. They are not get-rich-quick schemes, but they are tools that can help you build your brand and scale it. If your brand is rubbish, then it is not going to work no matter how good their distribution system is. You still need to do all the branding, product design, and marketing yourself.
So what do you create. Well the world really is your oyster. Generally I recommend staying away from electronics. Starting with something that doesn’t really have a sell-by date or too many moving parts.
What role does quality play in building your brand? [07:41]
You don’t want it too simple because you want your brand to bring the idea of quality to the product. So it can’t be something like marshmallow sticks where any one marshmallow stick is much the same as the other. People need to associate quality and look at two products that look very similar and don’t really know why one is better than the other, and instead rely on brand and pricing to decide. You want to keep your product not too heavy, otherwise storage and delivery costs will be really high. Don’t go too expensive because the cost of returns or problems with single items will cost you a lot and, and don’t go too big for a similar reason for why not to go too heavy. And also you don’t want to go too cheap because then the fulfillment cost, the delivery will take too large of a portion of the price. For instance, if you’re selling an iphone cable of 5 pounds, you’ll struggle to make money because the delivery alone will cost you 3 or 4 pounds. Further than that, you want to create something that you yourself will use. In particular, if you’ve got any sort of hobby or something you’re quite interested in that is not particularly mainstream.
What are Sam’s own product based businesses? [08:53]
so for instance for me, two product based businesses that I have at the moment. One is a gin company that I started because I really liked gin and I had an idea for how I could create something a bit different, and the other one is a table tennis company because I am very interested in table tennis and had an idea for something that I could create that would be a bit different. The other advantage to creating something for an interest or hobby that you already have is you probably have an idea for how to market it already. You know people that are interested in it and you know where people who are interested in it hang out. I started this type of business because it is my favorite but it does have one big downside and that is you do need a fair amount of money to start. Maybe not a lot in the grand scheme of things, but still, you do need, I’d say probably a minimum of five thousand pounds. And do not expect to take your money out too quickly. Building a brand takes time. Getting the prototype right, getting your stock made, getting it into the warehouses and then starting to sell. This all takes time, and then what you’ll find is as soon as you start selling and bringing in a profit, you’ll need the profit to invest in more stock and bigger product lines. You’re probably looking at like a year really before you can start paying yourself a salary. If you’re looking for something that will get you out of your job right now, this is not it. But it is something you can start on the side and build up slowly and then 6 months or a year, maybe a year and a half, you should have something that is earning you a different income and is worth something, and from there the sky’s the limit. There is no reason why brands started this way as a one person business cannot grow and scale and become the next APple or the next Nike or the next Adidas. Okay, I think that is enough on physical product businesses. There is a huge amount more to say and in the show notes I’ll link to a few of the articles where I go over it in more depth. But for now that’s a brief overview. You can as a one man band, now in 2018, start your own brand and grow it to be a multinational business. I’ve done it a few times and there are countless examples all over the internet of people doing the same.
Let’s move on to the next one.
Service based businesses [11:11]
Almost the complete opposite to the first whereas the physical product based business might need a year to a year and a half before you can start taking money out, service based businesses start earning straight away. A few years ago I confused my then girlfriend now wife to quit her job and start a business so that we could go travelling together. What businesses did she start? A service-based business so that she would start earning straight away and could start funding our travels. Perhaps the easiest service based business to start is as a freelancer. That is where you are taking on jobs for other people in something quite niche. Let’s say you are good at website design. You could take on jobs to build a website. If you’re good at SEO, you’ve got a background in marketing, you could start doing marketing jobs for people. Freelancers covers a huge variety of things from writers to translators to lawyers to accountants and often you can get going pretty much immediately. There are quite a few services out there such as freelancer, upwork, peoplepower, that lets you both hire and advertise yourself as a freelancer. Once again, freelancing isn’t a new business model but the internet does make it easier than ever to get started and to find clients. What I really like about this business model is that you can start small with almost no initial investment and then scale up. You can scale up either by taking on more staff or outsourcing some of your works, say you were doing marketing, you can start with just yourself and then as you get more jobs you can start outsourcing parts of it to other marketers or even bring people in house and build your own marketing agency. Or you can also scale up by charging more and more and more. One of my side business is a consultancy. I don’t do much work on it because I don’t really enjoy it but when I did I charged quite a bit of money so that it really is worth my time. And the beauty is that as my consultancy gets more popular and I get more work than I want, I can slowly put my prices up. Change of supply and demand balance until it is a level that I am happy at. So how do you get going with a service based business. Well if you already have an in demand skill and it is quite straightforward, let’s say you’re a certified accountant, then it is very easy for you to start offering your services as an accountant. Or let’s say you have a background in web development and you’re really good at making websites. It will be very easy for you to start. But let’s say you don’t have any of those skills, what do you do?
How do you freelance without preexisting hard skills? [13:55]
Well there are also basic things that are always needed. If you’re an english language native speaker, there is always a demand for people that can write fairly legible english language. Or if you don’t have that, there are really basic things such as data entry. But generally, those are the jobs that everyone can do are quite limited in terms of how much they pay. You’re probably better off developing a skill that is in demand. For instance, in 2017, life coaching has become quite trendy. A lot of people trained as life coaches and maybe spent a few months and went to one or two courses, got a qualification and started offering their services and getting clients. For years, programming has been quite popular and people would take courses online, or more niche stuff such as wordpress implementation. Installing wordpress sites for new bloggers. What skills do you have that you can use and sell on as a freelancer? Or, what skills do you think are you going to be in demand soon? One of the great things about the internet at the moment is that information is very easy to acquire. You no longer need to go to a very expensive university to learn a course. Now a lot of universities are putting their material online for free, and even if there’s not there’s often alternative ways to learn these once quite elitist subjects. So I’ve spoken a bit about the advantages of doing a service based business, let me talk a bit about the disadvantages.
What are the disadvantages of a service based business? [15:48]
These are more difficult to scale your business independently of you. Your personality and skill set are often tied to whatever it is you do. The brand Adidas, it doesn’t matter who is controlling it at the time, it is still a powerful brand and worth something. Whereas my Sam Priestly consulting, no one else can do that. I need to be there and putting in the hours and exchanging my time for money. Yes, it is possible to bill an agency and have it independent of yourself and then sell it on, but it is much more difficult. The other disadvantage is that because it is so easy to get into, there is so much competition already out there. This in turn, drives the price down and means that what might be quite a valuable skill once upon a time you can now get quite cheaply. If you try and market yourself as the cheapest in field, you’re going to fail. There is always someone willing to do it for less money than you. Instead, you need to narrow it down, find a niche, and scale up. Okay, enough for service based businesses. Let’s move on to the next type, entertainment based businesses.
Entertainment based businesses [16:58]
This is something I don’t know that much about as I’ve never built one myself. You see them all the time from instagram celebs to youtubers to trick streamers to stand up comedians to video game developers. There is a whole industry that is built off the back of providing content for other people’s entertainment, and nowadays you don’t need to have a publisher or literary agent to say that you’re good enough to publish your own novel. And you don’t need a big movie studio in order to okay your idea and produce a movie. Nowadays you can do it yourself and publish the content yourself, and if people like it they will sign up and support you. If you are an artist, or you have great ideas for movies or you have always wanted to create some form of entertainment, now is the best time ever in the history of humanity for you do it. People are quite willing to support new ideas and projects, with websites like Patreon where people can give you monthly donations in order to help you produce your art. Brands are paying a lot of money for youtube stars and instagram celebrities to promote their products. And there’s obviously the standard advertising network built into places like youtube which will pay money directly to the content creator without having to go through loads of different agents. People keep telling me that the age of youtube and the soundcloud rapper are over, and those things are now too competitive. I really disagree. I think that those entertainment mediums are just becoming more and more popular and we’re going to see the next generation of netflix original series and big money investment will be going towards youtube creators and independent producers. It is really hard to compare this type of business to the other two because it depends so much on the quality and the production value of whatever it is you’re creating. If you’re naturally good at filmmaking, and you work really hard and you have a little bit of luck to help you along than you could really make it big. On the other hand, you might not be very good, but I try my hand writing novels. I wrote a quick one which I published on Amazon, and yeah it is not a talent that I have. Maybe one day I will work on something as a passion project, but I know that for me it is never going to a viable income stream or business. But it does bring me on to our next type of business. Which uses pretty much all the same mediums as an entertainment type business, but isn’t so dependent on you being interesting or creative or popular, and that is an education based business.
Education based businesses [20:00]
As you can tell from this podcast, I am not trying to be as entertaining as possible and really if I was trying to make a comedy podcast, I would fall flat on my face and fail. What I do have is quite a lot of knowledge on a few subjects which a lot of people find helpful and interesting. The plan is that people will find the content of this podcast useful enough that they can get over the sort of dullness of my voice. Or the low production quality of my microphone and audio editing skills. We’ve mentioned a load of different mediums already, youtube, podcasting, there’s also many other ways to get your content out there, such as blogging, like my website at sampriestly.com or creating your own courses that people pay for, or creating webinars, that are live, lecture style but with audience interaction, and even setting up conferences and in person lectures around the world. If you’re an expert in something this is obviously kind of an obvious and straightforward business for you to try out. Let’s say you’re really good at the piano. You are a world class pianist. You’ll probably find that there’s quite a big market of people that would like to learn directly from you. Either on skype, or from people recording their music and then sending it to you, or a live audiene that people coudl learn from you on youtube or a paid course. But then again, maybe not because there are already a lot of pianists out there. Maybe the thing you’re best at is piano, there might be something else that you’re almost as good at that isn’t quite as competitive.
What two ways can you go when starting this type of business? [21:55]
One is try to find one customer at a time and sell to them directly. You can look at freelancing websites for instance or try and find an agency that puts piano teachers together with students, and then start there and then slowly build your business from there and so the add on more things such as youtube videos and do paid courses or self-publish book and start showing the same things to the audience. Or you can approach it from the other side. You can start creating content and then hope that people will come across it and you’d build an audience that way. For instance, I make a pretty good income from my blog, but I built that by just putting out all my info for free, slowly creating more and more content, and then doing some marketing to try and get people to read it. I think it took six months before it made any money, and maybe a year and a half before it was paying a full time income. And I think that is pretty quick. Whereas if you approach from the other direction ,you can start earning straight away, all you need to do is find one client and earn a bit of money from them, find another client, and then build up from there. And then scale it by introducing all the other mediums that can be accessed by sort of an unlimited number of people. Alright, let’s move on to the fifth and final category.
Opportunity based businesses [23:30]
I would get loads of questions, what about dropshipping, or retail arbitrage, or matched betting? All the other buzzwords that you see plastered across Facebook promoted by all of the gurus. So let’s touch on this briefly. By opportunity based business, what I mean is basically any money that you would make from market inefficiency. Let’s talk about retail arbitrage as an example. So retail arbitrage is when you find something in a shop that you can sell for more online. So there are a few apps that you can put in the show notes where you can go and wander around your local supermarket, scan each item, and it will compare prices and then give you an idea of how much money you’d make if you’d buy it and then send it off to an Amazon FBA warehouse. A very simple business model that makes its money by finding inefficiencies in the market. The inefficiency is the price it goes for locally versus the price it goes for online. This is retail arbitrage, and people do make good money from it and this is an arbitrage opportunity and the more competitive it gets, slowly it is going to get harder until really there is not difference between the price you can get things on a shop and the price you can sell it for online. Because of that I don’t really recommend it as a long term business. But it doesn’t mean that it is not worth doing. One of the advantages of it is that you can start straight away with just a hundred pounds or so and instantly learning how Amazon works and how Amazon FBA works. You can use it to build up and launch a different type of business. For instance, you can do it a bit of retail arbitrage using Amazon and Amazon FBA, get used to it and how everything works, get your account in good standing and then go and launch your own brand using Amazon FBA. The same principle really applies to all of these businesses that I am going to talk about that come under the opportunity based business.
They’re normally either short term as in it is an opportunity that is getting tighter and tighter and more competitive or it has quite a low cap to how much money can be made. And because of this you should go into it knowing it is not going to last forever or make you a millionaire. Much better would be to use them to earn a bit of cash flow to build into a more sustainable and scalable and longer term. SO this is any of the other four categories that we have already talked about.
Okay let’s talk about a few of these opportunities. So we have spoken about retail arbitrage. Another one is matched betting. This is when you take advantage of a sign up offer that somewhere like a casino or book maker gives you, and then you extract as much value as you can from that offer and keep it. Matched betting exists because bookies are in competition with each other and they’re trying to attract customers so that they give you free money in the beginning so that you will stick around and use them long into the computer. SO the opportunities lies in just signing up to every bookmaker out there, taking advantage of the offer and then never laying there again. I started matched betting 10 years ago and back then it wasn’t well known and there wasn’t a lot of opportunity and I made quite a lot of money from it. But now it is pretty well understood and matured. You can still make money out of it but it is pretty limited per person. You can probably expect to make a fairly straight forward 2,000 pounds and after that you have to work really hard to make any more or either give in and move onto something else.
Does Sam recommend matched betting? [27:44]
Do I recommend matched betting? Yes I do if you’re trying to generate cash flow in order to do something. Or just need a bit of extra beer money on the side. I do not recommend it as a long term business. Another opportunity is dropshipping. Dropshipping can mean a whole bunch of things. Generally it is when you have a storefront which can be your own website or it can be something like Amazon or Ebay, where a customer comes to you, they buy a product, but you don’t actually have the product or own it, when they place the order to you, you then send that order on to the actual manufacturer of the product, and then they deliver it to the customer. Now this business model can be used very effectively to build your own brand if the company you’re working with doing the actual dropshipping is able to make your own unique branded items. But that is not normally what we’re talking about here. What we’re talking about is generally selling quite generic or well known brands but having it on your website or on a medium where it is more expensive than elsewhere. A simple example might be that I copy a bunch of listings on Amazon and put them over to Ebay and just add say 10 pounds to the price of everything. Then if someone buys something from me on ebay, I go to Amazon, buy the product, and put in that persons delivery address. I put in the difference between what it is going for on on ebay and what it is going for on Amazon. Generally, dropshipping courses tell you to create your own website, stock up on product, and drive as much traffic as possible to your own website. Again, I don’t really like it as a long term business model because people are getting more and more savvy. I think gone are the days when you can have different prices all over the internet and people wouldn’t know how to really price compare. Whereas now as soon as they look at your website they’ll see who’s cheaper through a price compare. Dropshipping does work and does have the advantage of not needing really any initial investment to start up, because you don’t hold any stock. You just sort of parse all this straight on. But it is very competitive now, it is quite difficult to earn money and it is getting harder by the day. The final opportunity I am going to talk about are niche websites. A niche website could be a really high quality targeted website that could be a huge website in the future. Generally when people talk about niche websites in the online business world, that is not what they mean. It is just a website about a particular topic, such as the best vacuum cleaners. You create a website, try and get it to rank high on google for the best vacuum cleaners, you fill it with generic info about vacuum cleaners, and then you put on a refer a friend or affiliate links to amazon or online shop and then you will get paid a commission in exchange. I am only mentioning this one because there are still a lot of people who talk about it and I am still getting a lot of people who ask about it. When the internet was still fairly new this was still a big money maker and it was still easier to get higher on google, and there were not many websites about niche topics, whereas now there are a million and one websites doing this same thing. If you want to build a website in this niche, you need to build a lot of time on it, you cannot just churn out stuff for 100 different niches and hope to make good money. Yes, people do, but it’s not good for a beginner starting out.
On the other hand, on the education side, if you do know a lot about one particular start up, such as tae kwon do or vacuum cleaners, then going to one indexed niche site that is actually your whole business could be the way forward. But then again, creating loads of generic niche websites is not a good plan.
Okay everyone, thanks for sticking with me as we blitz through all these different types of businesses. I am going to start putting links to more information about each one. I have quite a lot of blog posts and there are quite a lot of other very good resources out there on the net so that if anything took your interest or there’s an opportunity, or if there’s inspiration you’ve taken, then go and do further research and as I said in the first episode, yeah just get it going. Get started. I’ll also try and do more podcasts talking about the nitty gritty of the different business, so expect to see them over the next few days or weeks or whenever I get around to it. You can contact me at email@example.com.
“If your life is just a series of successes, you’re not pushing yourself hard enough.”
Welcome to the first ever episode of The Lazy Entrepreneur Podcast! I talk about how I turn my ideas into businesses in the least risky and quickest way. Using this very inaugural podcast as an example.
It’s a bit rough around the edges and I take some time to find my feet. So if you think it’s rubbish try one of my more recent episodes. You can listen to them in any order.
Listen to this episode of The Lazy Entrepreneur Podcast on:
1:57 Focusing on putting out content rather than obsessing over quality
2:50 Why Sam is putting out his early episodes rather quickly
3:09 Defining Terms
4:54 Why start with minimum viable product or soft launch?
6:43 When Sam spent 15,000 pounds on a rubbish idea
7:18 What Brian Tracey has to say about luck
10:12 Why Sam describes what he does as lifestyle entrepreneurship
11:05 Applying these concepts to businesses Sam started
17:46 What happens if someone steals your idea?
20:20 Three criticisms Sam hears towards putting out a minimum viable product
23:32 Big takeaways from this episode
Hello and welcome to the first ever episode of the lazy entrepreneur podcast. I’m your host, Sam Priestley, and this is the podcast that’s all about using business to help craft your perfect lifestyle. Each episode will be on a different subject. This will be anything from really practical things, such as how do you actually set up a business, what are the different types of businesses that are working and making people money in 2018. How do you ship internationally, how do you deal with sales tax in the US and v-18 in europe and all the other sort of complexities that a solo entrepreneur might face.
And we’ll also cover more general things such as what actually is lifestyle entrepreneurship, what is the difference between a startup and an actual business, when do you know it’s time to quit versus just trying harder, should you start multiple businesses or focus on just one. I’ll also include some anecdotes from my life and my career, including some of my biggest failures and what I could have done differently. All in all this podcast is meant to be an extension of my blog which you might already be familiar with. It is sampriestley.com, but what I hope is that I can get out a lot more content a lot quicker than I do with the blog, which brings me on to my first apology.
1:57 Focusing on putting out content rather than obsessing over quality
I’m really sorry if the quality of these podcasts aren’t what you’re used to. I’ve purposefully made the decision not to spend too much time on post production or recording 101 takes or getting them professionally edited or hiring a producer or hiring a recording studio. I’m literally just walking around my house at the moment, just talking to you on my phone through my normal iphone headphones.
I’ve done this for a few reasons, one of them is obviously it makes it a lot quicker to get the content out. To focus on content over production quality. But the other reason is this is a new business and the first few episode are my proof of concept. I’ve purposefully not spent much money on it in order to get them out as quickly as possibly and start getting feedback. It might turn out that I’m really boring to listen to and you’d much rather read my stuff in text. It might turn out that I have a really annoying voice or that I speak too quickly or that you can’t understand a word I’m saying. Or that my content just doesn’t transfer over to the audio format very well.
2:50 Why put out early episodes quickly
By turning out these episodes quickly in a low cost way from launch, I’m putting into practice the subject of today’s chat. That is, turning and idea into a business in the least risky, easiest way possible. In this episode I’m going to go through the steps I use to go from an idea in my head to a proof of concept to a product that’s out there and hopefully making money. OR, on the other hand, a product that failed but hasn’t cost me too much.
3:09 Defining Terms
First of all, let me define a few of the definitions that I’ll be using. Proof of concept or minimum viable product is really the first thing you can release to the public, you can start getting feedback on. In this case, this is the first few episodes of the podcast. If you’re also a resturaunt, it might be doing a one off pop up or a stream through market. With my gin business, pipehouse gin, the first minimum viable product was creating 250 bottles to begin with and seeing how they sold. With an AMAZON FBA business that I’ll just be getting a few hundred products rather than the most cost effective way of ordering products which is in the thousands and with the tech out that would mean just launching with the bare minimum of features. The other team were going to use is “soft launch”. By soft launch I mean you put your product out there without telling many people about it or just telling a select few. You know that the product you’re releasing isn’t really good enough for the mass market and you don’t want to ruin your reputation and you don’t want to waste money on a big market push. For this podcast, it means for the first episodes I’m not going to really tell many people about it. Then I’m going to send it out to a few select people who will give me honest feedback without hurting my feelings and I’ll know it will still be around even if its a bad attempt .With my craft gin business, pipehouse gin, this meant launching locally at local markets without telling really too many friends and family, or talking to the newspapers, or talking to big distributors.
We want to just get our recipe and know what we’re on to before we hit that really high value but also really expensive to capture targets. SO why do I suggest with minimum viable product and soft launch then. Well there are a few reasons.
4:54 Why start with minimum viable product or soft launch?
If you’re anything like me, you’re most excited about an idea when you first have it. I’m a real optimist, when I come up with an idea I assume it’s going to be easy. I start tracking out all the steps and I have so much energy. But then as I start researching it or thinking about it or sleeping on it for too long, I start to think about everything that could go wrong. I start to think about the problems that might happen later on down the line. OR what if people don’t like it or it’s a failure, or what if I lose money. It’s those first few weeks that I have the most excitement about the project. It’s after that, if I don’t have anything out here, I’ll do more and more research, I’ll start double thinking myself, I’ll start worrying about all the things could go wrong, I’ll read about how saturated and competitive the market is, how very few new entrants are doing well, i’ll start hearing about horror stories. I’ll also start to lose interest and start thinking about other newer ideas. Whereas if I start immediately, yes I’m going to make a bunch of mistakes, yes, I’m going release a not so good product, I’m also going to be excited about it and then when I hit the problems I’m going to solve them and I’m going to have the energy and the desire to solve them. And plus I also will get an idea of whether it’s a good idea or not really really quickly I’ve had a few businesses where I’ve got 6 months to a year into them spent a lot of money and then discovered that it’s a terrible idea and that nobody wants it.
6:43 When Sam spent 15,000 pounds on a rubbish idea
One example I’m thinking of in particular as when I spent almost 15,000 pounds on it and it was a rubbish idea but nobody told me that because I never really got it in front of anyone. I just spent all that time working on it, paying for developers, Building Technology only then to find that one no one really understood the idea and to no one wanted it and to be honest, having a bad idea is a real risk. I think that less than 20% of my ideas that I end up trying to turn into a business are good ones. All of them I’m equally excited about and the sooner that I get them out there in front of people, the sooner I know whether they’re going to work out or not.
7:18 What Brian Tracey has to say about luck
I read a good quote this morning from Brian Tracy: “I found that luck is quite predictable. if you want more luck, take more chances. Be more active. Show up often.” And I believe the same is true for turning your idea idea into a business and then to entrepreneurship. The quicker you try then the quicker you fail or the quicker you succeed, and the more you try, the more likely you are to eventually end up with a winner. Which brings me and do another reason why it’s important for you to get your minimum viable product out there soon as possible and that is to limit your risk. I keep hearing about people wanting to quit their jobs and invest their savings and just starting a business oh, what a terrible idea that is to take all that money that you’ve worked your life for and then throw it on a Gamble because honestly starting a business is a Gamble and you can improve your odds and make it more likely. Seriously, if this is your first attempt to start a business, you don’t want to throw all your money onto it. With a small portion of that money you can get Your minimum viable product out there, soft launch it, get validation oh, and if it looks good then you can improve it. Take the feedback, incorporate the feedback, and scale up and get more validation and then improve it some more. I too well know the risk of throwing a lot of money into a business which I’m not sure is going to succeed or not.
We’ve already mentioned one which cost me almost 15,000 pounds. There was another one I did which was a very simple idea: I want to start a coffee shop. So I went around and raised the money that it would cost to start it, it cost about 100,000 pounds, I’ve never started a coffee shop before. I’d never even made a cup of coffee really, not on a professional espresso machine or anything. I found a location, I spent quite a long time working on it and eventually we launched, and naive me thought: yes, this is going to be great, the contents good, I’m really clever, my ideas are good. Surely this is going to be a great success. Except that didn’t really happen. It wasn’t a success, it wasn’t a failure. What happened was the coffee shop ended up taking over, not making any money, not really losing any money, kind of scraping by. Taking up a lot of time and energy, a lot of worry, I had people who invested in it, wanting to get their money back, wanting to get their interest, I had employees relying on me for their livelihood. Eventually, I managed to pass on my stake in the business for someone who had a lot more passion for it. In the years in between, though, it used up a lot of energy and worry that could have been used on other ideas and businesses.
10:12 Why Sam describes what he does as lifestyle entrepreneurship
This is why I describe what I do as lifestyle entrepreneurship. It’s very different to build the next uber or trying to make it big on one of these businesses. Those are gambles, and you gamble a lot and if you lose, you end up with nothing. And often, worse than nothing. And most people fail. Rather, what I’m trying to do is give myself the biggest chances possible of success. And the best way to do that is by having lots of attempts, none of which would cost me very much if they fail. By starting small, with a minimum viable product and small amounts of money, and launching while you still have energy and motivation for the idea, you actually increase your chances overall of having a success.
Okay, now that I have hopefully convinced you of the importance of starting with a minimum viable product and a soft launch, let’s look at how I have applied this to different businesses which I myself have started. We’ve already spoken about this podcast, but let me tell you about what I plan for the future. I am going to start by releasing a few episodes without telling anyone about them at all. Then I’m going to start to get feedback from those close to me or people who I know are going to be supportive and give me good feedback. Depending on that feedback, I will either stop the business altogether, or I might go back and re record some of these episodes, or I might push them out to a bigger audience. If the feedback is good and I am getting a lot of encouragement to do more, I will up the pace at creating content. I might then start investing some money and hire someone to come and help me out or to do some production. I might start looking for sponsors to help cover its cost. I might start looking at marketing to help push it bigger. Or, i might change my idea completely or do a completely different style podcast or start doing youtube videos or start doing something else. Because I got the initial product out very quickly, pivoting and getting the idea out altogether isn’t going to cost me very much. So that’s the podcast, let’s look at another business.
My most recent business that I started is pipehouse gin, which i’ve already mentioned a few times on this episode. That business took a lot longer to get the first minimum viable product out, but it was still a minimum viable product. When we were looking to start it, I ended up contacting pretty much every distillery in the country asking for help and tips and the tip correspondence I got is that you need half a million pounds and a degree in this and that and experience in the field before you can do anything. Well, i had my target, I wanted to launch, spend 10,000 pounds under, and get the first product out. It took 9 months, but we managed to do it and get that first Earl Grey Cucumber flavored Gin, which you can now see selling on my website or in local shops or through a biggest distributors such as masters of malt. And we did that by first of all, launching just 250 bottles. I mean who can’t sell 250 bottles of gin? We would sell them eventually no matter what happened. It was a very low risk investment. Then as we started to get feedback, we started to scale up. And now we’re at the point where we can go and talk to biggest distributors and start looking at international expansion and how we can turn this small, low risk business into something that’s almost destined to succeed in the future.
Another example of that is my first Amazon FBA business. You may have heard of Amazon FBA. It’s the fulfillment business of Amazon, and it basically means you put your stock into Amazon’s warehouses and when you sell a product on their website, Amazon will deliver your product and then will do all the returns and customer service. It is a very nice way for a solo business person like myself to build a product based brand. You don’t need to deal with warehousing, or put it in your garage and take it down to the post office to post. Instead amazon handles all of that for you. Now the problem is when sourcing products for a new brand, the cheapest way to do that is by buying it in huge quantities. So what we did instead was we bought a small number and had some prototypes and then we started selling those prototypes and getting feedback. And as we got feedback we started editing our design and then slowly increasing our orders as demand grew. There was another business that was started with a relatively small amount of money. I can’t remember how much now, it was 2012, but I think we started with under 5,000 pounds but it has now grown up to be a very very very large business.
Another example is a business I had which was importing and selling cars. I came across this opportunity that I thought was great and it was a really big difference in price between what people were paying in price in the country of malta and what people were selling them for in the united kingdom, and we both drove on the same side of the road and the cars were the same. So I thought what a great business, I will start importing cars and selling them for a very big markup and start selling them. Now the easiest way to have done this would have been to buy a big container lorry, stack it full of cars, and then drive them over and start smelling them. Could have gotten a container lorry, we looked into it, i think it was about 13,000 pounds which would have taken six cars, I could have gone and found six cars, put them in the lorry, and shipped them over there.
Probably all in started for maybe 70 or 80,000 pounds. But that was not what we did. The first step was to buy just one car, which we then paid someone a relatively large amount of money to ship over for us and then we tried to sell that car. And then once that sold we found another car and did the same thing again, and then once that sold we found another car and did the same again. Where this story differs from the other ones is that this business turned out not to be worth it. This was a business that just did, the margins just weren’t really there. The business culture of buying and selling in Malta, given the amount of time I wanted to commit to it, just wasn’t worth it. And the time it took to sell each car got longer and longer and longer until we were holding stock for months and months and months.
If I done the original thing, the best value option, which is buy a car, transport it, send it out there. I would have been stuck with either forcing the business to work or to lose money on it. And give up. Neither of which is a good option, I may have been able to force it and end up making money, more likely I probably wouldn’t have been able to force it only to spend a huge amount of time on it only for it to not make money. And remember, all of the time we spend on a failing business or a lukewarm business is time we’re not spending on the really good businesses. Okay, now that we’ve covered some examples, let’s talk about the most frequent criticisms people have of this business model.
17:46 What happens if someone steals your idea?
First off, what happens if someone steals your idea? This is a pretty common question because you’re putting off your idea with hardly any substance behind it. If you think about it, it would be quite easy for a really big business to swoop in, take your idea, make a better version of it, and put it out there. I’ve never had it happen to me and I don’t know anyone who’s ever had it happen to them, but there is a risk and there probably is a small chance that it will happen. After all, anytime you put your idea out there, someone could take it and go work on it and build it. You know what, the only time I’ve ever had my idea stolen, it’s once I’ve already made a success of it and then people are queuing up to steal it. Most people are too busy with their own lives to bother with stealing your business. And if they are goign to steal it, they will steal it whether it’s big or small. Even if you spend a year, spend 100,000 or 200,000 pounds or a million, if a big company comes along and thinks of a better idea, they can come along and steal it anyway and do it better than you. You could focus on patents or trademarks or that sort of thing, but for most of the business that we’re starting, those sort of things don’t really hold much protection. Yes, if you’ve invented something brand new, a patent acould be the way forward, or if you’ve thought if some innovative change of view for something, a patent might work.
But in reality, most of our businesses are just derivatives of something someone else has done. For instance, with this podcast, what could I possibly patent about it? With the gin i’m making, I’ve got the recipe, but that’s okay, people can’t steal my recipe anyway. And it’s not like I can patent it. If someone steals the ingredient combination I could be using ,there’s nothing I could do about that. And that’s the truth about how most of this stuff works. Coca cola, my patent formula, but that doesn’t mean someone like pepsi might come along and make something very similar. Another thing to remember is that we’re now dealing in a time where international business is very easy. People can make your product and ship it from anywhere, and forcing your product or patent protection is very very very difficult. Can someone steal my idea? Yes they can, but having a minimum viable product doesn’t make it any more likely that someone is going to steal it. And just because someone can steal it doesn’t mean you shouldn’t do it in the first place.
20:20 Three criticisms Sam hears towards putting out a minimum viable product
Other criticism i hear with launching a not yet ready product, “isn’t it embarrassing that you’re putting something out there that isn’t very good or isn’t as good as you want it to be?” Well yes it is. Anything innovative, unique or creative is going to have some type of embarrassment. I’m particularly a sucker for peer pressure. But you know what, I think this way of doing business is actually better for embarrassment levels than for putting 100% of your energy into it, putting loads of money, and then doing a huge launch. When you’re only doing a soft launch, only a few people will see it to begin with. So if they don’t like it, you can pretend it never happened and most people won’t know about it. Second, easy come, easy go. If people say, this is rubbish, then you can say, Oh I didn’t put much effort into it. But if they said it’s rubbish after you put a year of your life and lot of your savings into it, that is going to be a lot more detrimental. And finally ,what you eventually release is never going to be as good as you want it to be so isn’t it better to get that embarrassment out of the way as soon as possible. Once you have something out there and people start reviewing it and you get good feedback and bad feedback, it gets better and each subsequent and each iteration of your product will get better and better and better, so everytime you release a new update or version, you’ll have less bad criticism than before.
So instead of having embarrassment each time you released a new product, you should be feeling great. The final criticism I’ll talk about is doesn’t have a negative image on your brand. This is an answer where there is a yes or no aspect to it. If I say I launched this podcast and sent an email to every person in the world and you came and listened to it and said you hated the first episode, you won’t coming back. But that’s not what i’m doing, I’m doing a soft launch, putting it in front of a few people and then improving it. The majority of people won’t have had a bad first impression because the first time they come in front of my product is when it will be developed enough to the point that I know is good. It would be much worse if I spent six months to a year working on it, release it, and not be very good but do a huge marketing push and everybody hates it. THe other thing people worry about is having failure attached to their names. This is something that I kind of get but I also think it is a really bad aspect of our culture. People want to be seen as having a non stop string of successes throughout their life. But
22:52 To be honest, if your life is just a series of successes, you’re not pushing yourself hard enough. And i believe, that employment culture and culture generally is changing to reflect this. If you now go into an interview at a big tech firm like google or apple, they don’t want to just see your successes but also your failures, and how you’re able to overcome them and bounce back. I personally think that having failures in your portfolio is a good thing. It shows that you are human and how you deal with adversity when things get tough. And trust me, they are going to get tough at some point.
So what should you take away from this episode.
23:32 Big takeaways from this episode
I want you to go out and start that project and get those first minimum viable products out there. If you have one or two ideas that you’ve been thinking about for years, like “oh if I have enough time or investment then I’ll do it.” Nonsense, do it now. If you started it a few years ago when you first had your idea, then you’d still have it out there. Yes you would have fallen into mistakes, but you would have overcome them. And you might just have a life changing business. And you know what, if you failed, you would have learned loads, had that experience, and have that failure on your resume to show that you can take initiative and calculated risk. I hope you’ve enjoyed this first episode, if you want to find out more about me, you can find out on sampriestley.com. If you have ideas for this podcast, then email me at