So take the Illusions of Entrepreneurship Quiz - but don't let an "F" on that quiz stop you from starting your own business. Because the only thing that is relevant (in my opinion) to your success is is your own hard work, dedication, and creativity.
Technology never ceases to amaze me. Here is a State of Small Businesses Survey by Huffington Post which captures the effect of the poor economy on small businesses. What I was also most impressed by was how their data was being shared. They surveyed small business owners and asked them about layoffs or reducing working hours and their expectations for their business in the short run. I love how they put all of the data on the web in google maps. You can click on a "dot" below and read the survey response from that business owner!
As a quick side note - we started our business in one of the worst times to do so - during the internet post bubble in 2000 and 2001 when no one wanted to touch a startup and the "good old days" were over. But we were small and did it on our own and are still in business 8 years later!
Huffington Post - Small Business Survey - Click on a business to see their response.
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Sure there's eBay, Facebook etc etc - but probably nothing defines the power of the internet to me as well as Wikipedia - which basically houses the shared knowledge of the collective. Here's a great video on one man's vision of a free encyclopedia for all. One more quick note - I love how Wikipedia is seen as a living organism constantly growing and improving. The business lesson is that through collaboration you can build something on such a massive scale that no corporate structure could afford to take on.
Jimmy Wales recalls how he assembled "a ragtag band of volunteers," gave them tools for collaborating and created Wikipedia, the self-organizing, self-correcting, never-finished online encyclopedia.
I was having a conversation with a co-worker about a neat program she had done over one weekend... the gist of it was a bunch of people got together, brainstormed an idea for a website, and over the course of one weekend you create the site. I thought that was a great program that followed principles that this site believes in... namely, YOU can do something and it's better to do something than to not. But then the conversation took a turn for the worse.
I checked out the site and said cool, so what's her team going to do next? She said none of them has time to work on the site. I said well, you can take baby steps and before you know it you'll get inspired and the site will take off. She said no way, none of them had time to do anything with it. So I asked, so what will you do with it? She said they needed to hire a CEO to run the site.
So I asked how they were going to pay the CEO's salary. She said venture capital funding. I wondered to myself where one was going to get venture capital funding for basically a site concept. Reminds me of the docudrama Startup.com, where the camera follows a bunch of young adults starting up a dot com during the height of the internet bubble (they somehow got $50 million worth of funding for a simple website concept). After a few more exchanges, I gave up.
Some of my thoughts on this story:
1. An idea or concept is a dime a dozen. It's the execution that counts. You need to develop your idea to the point where it's of value (and what's more of value than something that generates cashflow!). Venture capital firms back in 2000 were just plain stupid, and they've definitely learned their lesson.
2. You do have time to develop your idea. It doesn't matter how much time you can afford to spend on it, it's just that you consistently work on it... and you're constantly adjusting your strategy and thinking creatively. Can you spare 10 minutes a day? Every other day? That's all it takes to get going. And soon you'll be up and running.
There are two wonderful books that will help you with these two points. First, there's "Take 10: How to Achieve Your Someday Dreams" which introduces the 10 minute task idea. Second, there's "Getting Things Done" which talks about the concept of figure out what the next action is for a project.
The book 4-Hour Workweek by Timothy Ferris talks about working no more than four hours a week and from anywhere you want... including the beach. I had my 4-Hour Workweek moment last August, which gave me the vision of what I wanted in my life...
My dad's company sent him to a conference in Honolulu, Hawaii... Quite a boondoggle. My mom joined him, and I figure I would too. Free lodging in Hawaii, all I had to do was buy a plane ticket. My dad even offered to cover that to get me out there, but I really didn't need any more incentive to go so I told him thanks, but I'd be more than happy to pay my own way there. This was August of last year.
Rewind back three years... I was an MBA student, and I discovered that buying textbooks at the bookstore was a crock... you could buy books on Amazon.com for at least $20, if not $50-100 cheaper. So after graduation, I started playing around with creating a site that felt just like buying from the campus bookstore, but it pointed you to Amazon instead. I got some revenue out of it, but nothing major.
Back to last August... I had spent the spring of 2008 working on marketing and promoting the website. I dropped almost $1000 on marketing (doesn't sound like much, but I'm closer to the "corporate" part of corporateprenuership than "entrepreneur"). The start of the textbook buying season coincided with my trip to Hawaii. And since students weren't accessible in the summer, all the advertising was done in the spring. So all I could do was watch and see how much revenue would come in every day.
The resort had a wireless connection, and it was accessible from the beach. So every day, after sightseeing, I'd take a swim in the ocean, have dinner, shower, and head to the beach with my laptop. Since Hawaii was 6 hours behind, I was able to check the previous day's revenue while I was still up. Each day I checked... some days would be $30 days, but some days got as high as $120 days. By the end of the week, I was up to almost $500.
I was living the dream... money was rolling in, while I was basically working one hour a night. That's a 7 hour workweek (not quite 4 hours), but when that one hour a day is spent on a laptop on a beach, I think anyone would sign up for that. The money I made wouldn't even pay for my flight out there, but it was a major breakthrough to taste it for just that week. I considered this the first step in the long term goal of financial independence. My mom took a picture of me with my laptop on the beach, and I have it up on my wall so I can look at it every day.
Some people back home didn't get it... They felt like it was sad that I was working on vacation. On the contrary... people thought my working on the beach was replacing vacationing on the beach. I wanted working on the beach to replace working.
Here is another oldie but a goodie from the Gallup poll about Entrepreneurs. I think the message is "Hard work pays off"...
Source: http://www.gallup.com/poll/18088/Work-Labor-Love-SmallBusiness-Owners.aspx
What does it take to start your own business? Entrepreneurial spirit is an obvious requirement, but it takes much more than that, according to a new Wells Fargo/Gallup Small Business Index survey*. Most small-business owners have a passion for their work, which leads them to work long hours most days of the week. As a result, small-business owners tend to see passion for their work as a natural part of their work-life balance.
Small-Business Owners Work Long Hours
Fifty-seven percent of small-business owners say they work six or more days each week. In sharp contrast, only 7% say they work fewer than five days each week.
Sixty-two percent of small-business owners say they work 50 or more hours each week. On average, small-business owners put in 52 hours each week.
Do Small-Business Owners Ever Relax?
On average, small-business owners say they take about two weeks of vacation each year. Six in 10 say they just enjoyed their last vacation, and didn't do anything work-related. Of the 39% of small-business owners who did work while on their last vacation, 8 in 10 (81%) say they made or returned business calls, and half (52%) initiated or returned e-mail.
Two in three small-business owners (67%) are satisfied with their ability to achieve a positive work-life balance. And a similar percentage (65%) feel they are able to make the time available outside work to do the things that are most important to them.
Being a Successful Small-Business Owner
Ninety-four percent of small-business owners say they are at least somewhat successful, 87% say they are at least somewhat satisfied with being small-business owners, and 84% say they would still become small-business owners if they had to do it all over again. However, becoming a successful small-business owner asks a lot of the individual and his or her family.
Given the long hours, being a small-business owner is not a 9-to-5 job. In order for small-business owners to achieve a positive work-life balance, their families must be willing to find ways to make work a part of their family life -- hence the fact that many small businesses are also "family businesses."
*Results for the total dataset are based on telephone interviews with 607 small-business owners, conducted June 10-24, 2005. For results based on the total dataset, one can say with 95% confidence that the margin of sampling error is ±4 percentage points.
It really shouldn't be if you're doing with integrity. Here's why. Let's say you put in your 40-50 hours a week at your job, work hard, deliver good results, and get paid $60,000 to do it. Then, in your time away from work, you make another $15,000 a year. Sure you don't put in the 60-70 hour weeks that some hard working colleague does. But you're not as sensitive to pay raises (or lack thereof) than someone who doesn't do it. So the company can get away with paying you a little less, and you're happy as a clamshell because you're essentially making $75,000 a year. If your colleague gets a pay raise that's lower than he expected, he might be looking elsewhere for a higher salary.
Let's take this a little further (now we're getting into uncharted territory). Let's say you have an eBay store or something and with an hour, you can buy and sell something that will make you $40. So in an hour, you've made $40. Let's say you put in another hour at work... that only nets you $30/hr (approximately what $60,000 a year equates to). Let's say you can do this every week, and somehow your company let you work 39 hours instead of 40, and paid you an hour less. You've made $10 more than you would've, and the company has an extra $30 in overtime to give to your hard working colleague who doesn't have anything on the side. So everyone wins.
Of course that doesn't happen in the real world, although some companies are doing reduced work schedules. However the perception is it's for mothers taking care of kids (which is getting outdated). Companies right now aren't prepared for this kind of thinking, so the short answer to this question is they shouldn't be, but they might. So a good compromise right now is to do things outside of working hours and employ the don't ask don't tell policy. But overall, we shouldn't need to apologize for wanting to make more out of ourselves.
Time for another installment of why Corporatepreneurship instead of just quitting and doing a startup. One of the blogs I subscribe to is the Brazen Careerist by Penelope Trunk. In this posting she talks about the perils of a startup... always being financially strapped, always on the phone, how you can never take a sick day. Take a look.
However, if you are able to hold your job and work on getting your startup going with small amounts of time carved out of your day, you get a chance to prove out your business model and make some cash before you take your leap of faith. Try SEEFADing. Stay tuned for more tips and tricks to get the best of both worlds!
One of the Tips & Tricks we at the Corporatepreneur are most proud of is SEEFAD.
SEEFAD: Self-Employed Experience For A Day
In one of our many "meetings of the minds" - we were lamenting about how annoying it was to work at your full-time job all day when you had something awesome you wanted to do for your own business on the side. And even worse - by the time you got home you were too exhausted to be productive for your own business and maybe you even fell asleep on the couch only to wake up the next morning and drag yourself back into your cube in the corporate world.
Well - we figured out a way around this and it has been amazing. SEEFAD. What we do is take a vacation day or use one of the many holiday days off to mimic a "a day in the life of working for ourselves." And the experience is amazing. It's like fast-forwarding into the future when you can control what you do and when you do it. And all of your productivity benefits you directly.
SEEFAD doesn't mean that we spend that entire day working a 9 to 5 for our own job. Some of us wake up late - hit the gym (because we always said we'd get in shape if we had more time) and then work leisurely from home. Other times a small group of 2-3 of us meet at a coffee shop with Wi-Fi and build our own businesses with great drinks and great company. Nothing is more motivating than being around others who are entrepreneurs (or have the entrepreneurial spirit) as well.
So try it for yourself, SEEFADing is not that complicated:
1) Pick a day that you can dedicate to SEEFAD (either a vacation day, or President's day, or even a Saturday).
2) Live that day exactly how you would wish to if you were working for yourself full-time!
Now tell us about your SEEFAD experience!
So what's the first thought that crosses your mind when you hear that? Many people are probably cynical, saying no more loyalty or what not, but there also is a positive ring to it... we're in an era now where we can set it up so we don't NEED the company to take care of us! So why try the entrepreneurship route? How the heck do you even spell entrepreneurship? Here are some reasons I can think of:
1. As a hedge to if something happens to the company you work for, or if you can't find a job when you get out of school. What I don't understand is people who are out of work who decide to get more education. If you're in need of money, why would you go pay more money to other people? Why not go out and try to make some money yourself?
2. As a way to give yourself a raise. Let's say you want a raise. You can work hard, continue to deliver results, and do what you can to show everyone that you deserve a raise. Then you can go state your case to your boss, who may or may not be able to give you a raise. Let's say he does. That raise then kicks in the next paycheck... maybe it's 5%. Maybe it's 10%. But it's maybe 6 months or a year later! If you've got your own business, you get a raise the second you deliver results.
3. A way to really leverage our strengths and keep you sane at work. You are in control over what venture you want to do. So you can pick stuff you're interested in and good at. For me, it's a great release when my ideas fall on deaf ears at work because it's not part of our "core competencies" or corporate strategy. It's a creative outlet for me that allows me to use the skills that my job doesn't let me use!
So that's why I do it. So far I've not been successful yet in turning a profit, but I'm gonna try until I get it! And hopefully blogging about it and hearing what everyone else's trials and tribulations are will keep me motivated.
As you know - we don't believe in the get rich quick scams. A common theme at the Corporatepreneur is that building a business can be very rewarding but takes time, talent and hard work.
I just saw a great article warning about the work from home scams. This article talk about how work from home scams are on the rise as the economy weakens and people become more desperate for money making opportunities. From the referenced article:
Durst says Staffcentrix researchers screen about 5,000 home jobs leads every week, and there is a "54-to-1 scam ratio."This came as a bit of a surprise to me. I wasn't sure there would even be one legitimate work from home opportunity in 55. Of course there are (like selling dental plans) but none of them will make you rich as I warned just a few weeks ago!
"This means that for every 55 [work-at-home] leads we investigate, only one passes our legitimacy standards," she said.
Would you like to make a six-figure a year (or better) income while you sleep, take a vacation, or work from home? Who wouldn't. Whenever I tell people about running an internet business they all wish they had a rack of servers somewhere practically printing money. But having gone through the 8 year process - I know why so few people are doing what we are doing - because they don't want to put in the upfront time to make it happen.
How can this be? Most people are working 40 hour weeks for less than half of that pay and have to put up with a crappy boss and depression. Well... the road to being a successful business owner is long and hard.
I remember starting a business in late 2000 right after the dot com bubble burst. We would work full days in the corporate world, then meet at an apartment with out laptops and crank out code for website ideas. This involved working everyday after work (often napping on the floor) and working most weekends, and as young single bachelors we did this for about 18 months before we ever paid ourselves a dime. In January 2002 we finally paid ourselves for this hard work - and of course over time the work was less and less business start up and more maintenance and growth. Now 8 years later we have very little business maintenance and focus almost solely on how to grow our business (no easy feat in these crazy economic times). The monthly income grew as well - though it was never really predictable. Ad rates, customer spending, competition - they never stop moving all over the map.
What I love most about being an entrepreneur is that I don't even feel that successful, we are still very small fish and our businesses aren't publicly well known - but that's also the great thing - you can be a wealthy anonymous person. Not everyone will invent the next google.
But the success and wealth at the end of 8 years of work often doesn't seem to justify all the hard work. In fact if I knew going in how much work we would do I'm not sure I would have signed up for it - though I also probably didn't know how much I would enjoy the business process and struggles. Anytime you are working for yourself you feel much better about having to do the grunt work because you directly benefit from your hard work.
I just love this post by Adam McFarland where he puts together a timeline of his entrepreneurial success. Be sure to poke around his blog because it is a great "real life" example of entrepreneurship.
As I am sure you know by now we believe in these real stories of business start ups and ignore the "get rich quick" schemes you see on TV. In our opinion - that's not what REAL entrepreneurship is all about.
Working for a large corporation has always been seen as a safe, stable form of employment. This faith in safe jobs is being tested in this economic downturn as we have seen layoffs of corporate jobs to save company profits.
Lost in the news of a recession, layoffs, and bailouts is the news that may have the most long term impact on you and your family. Large companies like Motorola, Starbucks, FedEx, and Kodak have started to cut or eliminate contributions to employee 401k programs.
With this and the social security crisis, you may have to become responsible to fund 100% of your entire retirement. This means everyone must run their households like small businesses to ensure that they have enough profits at the end of the month to save for retirement before they are physically unable to work.
A brief history of retirement:
Pensions (Peaked in the 70's and 80's):
If you worked your career for a company you could retire with a lump sum or annual payment in the form of a pension. This combined with a healthy social security could support 100% of your retirement needs.
401k Matching (Peaked in the 80's and 90's):
To save money, companies did away with pensions and offered a 401k match. Generally this meant the company would contribute up to 33% of your 401k retirement.
On your own (2010 and beyond?):
Without any company matching and social security at risk, it may be up to everyone to find the money at the end of the month to save for retirement in the face of rising taxes to help offset our national debt.
Is your company providing you enough for you to save for retirement? Even if you do not wish to leave your job and work for yourself, could becoming a Corporatepreneur help you fund your retirement and future dreams?
We do not advocate over sized entitlements like free retirement. But, we do think it is important for people to adjust from a world where you could get help in saving for your retirement, to a world where you are on your own.
Just because you have to do it on your own, does not mean you have to do it alone.
One thing that prevents people from going from the "thinking about it" stage to the "doing something about it" stage is fear that their idea isn't perfect yet. Well I found a great post on the blog A Smart Bear: Startups + Marketing + Geekery blog. Moral of the story is the title: Your idea sucks, do it anyway... it's better to do something, fail, and learn about than it is to not do anything at all... sometimes you end up being wildly successful at something not directly related to what you started.
I couldn't think of a better blog to start not only the new year but the official 1st day of this blog's public launch.
I believe that the rise of the internet has led to a resurgence in business ownership and entrepreneurship (no great leap there). But more than just a financial shift - this is a power shift and a "way of life" shift. The power corporations will hold for employment will certainly dwindle with time and imagine if you today could choose working from home for a legitimate business and make a $50,000 salary (based on your own hard work and performance - NOT some get rich quick scheme) - imagine how many people would do that versus trudge into the office everyday for their $100,000 salary. All of a sudden the value equation of working has changed dramatically - it's not single sided "take what you get" from a company but hopefully make a lot of money. Instead you can take exactly what you want (flexible work hours, choice of work, etc) and make a living off of it.
Anyway I digress - I stumbled upon this video about the next 5,000 days of the internet and was surprised to hear the internet is only 5,000 days old. It sounds like some sort of "duh" in hindsight - but the impact the internet has had in such a short time is amazing. Enjoy this video - as I am so glad this blog can be part of the next 5,000 days of the internet.
At the 2007 EG conference, Kevin Kelly shares a fun stat: The World Wide Web, as we know it, is only 5,000 days old. Now, Kelly asks, how can we predict what's coming in the next 5,000 days?
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