Do you want to be a better entrepreneur?

Do you want to make more money?

Here’s how you can do it in 6 steps.

1. Take a break

Just for a moment, sit back and relax. Before you dive back into your work you need to figure out where you are financially in life. One of the main reasons you are going into business is because you want to make more money. So the main question that should come to your mind is:

How much money do you want to make?

You don’t need a billion dollars and the odds of you making anywhere near that are slim to none. So what’s your number?

Chances are the amount you want to make is far more than you’ll actually need. Sit down and take a moment to write down everything you want to buy and how much money you’ll need to make to buy it all. Maybe a fancy house, some exotic cars, and enough cash where you don’t have to worry about working. If you add up the total of everything you want, it shouldn’t run you more than a few million dollars and if you break it down into yearly income it probably won’t be more than a few hundred thousand dollars.

If this isn’t the case, then you are smoking crack. You don’t need tons of toys to be happy. If you think you do, you will have a tough time making all of that money because it is really unlikely that you will make a few million dollars a year or sell your company for a hundred million dollars if you haven’t even made a few hundred grand first.

So stop swinging for the fences, especially if you haven’t hit a single yet!

2. Stop innovating and start copying

Now that you know that you don’t have to make millions of dollars a year, you have to come up with a business that will help you make a decent amount of money. It doesn’t have to be an innovative business that solves a pain in the market place; it just has to be a business that can turn a healthy profit every year.

A good way to find one of these businesses is by talking to friends and family. You’ll be amazed on how many basic businesses like plumbing (I am not saying you should be a plumber) make a decent amount of money. Find something that you’ll enjoy and start the business. Just don’t pick something that requires millions of dollars to start.

If you already have a business analyze how you are currently doing and see what tweaks you can make to it, so that it fits your financial objectives.

3. Time isn’t on your side

Nothing has to be perfect. What you may see as faulty might look perfect to your customers. It doesn’t matter what you want, it matters what your customers want.

This is why you don’t want to make any big decisions because if something goes wrong you’ll end up wasting a lot of time. Break that big decision into a few small decisions. Then survey your customers or potential customers to get their opinion; this should help you determine what route to take.

Even after you talk to your customers you are still going to make mistakes. Just make sure you are agile enough to adapt quickly. It is all about testing small things instead of taking months to roll out changes in your business.

4. Work hard, play hard

If you work 12-hour days, you are going to get burned out. It doesn’t matter if you love what you are doing you need to take breaks.

• Don’t work longer than a few hours without taking a break. Taking small breaks throughout your day will make you more efficient and cause you to accomplish more.
• Every week you should do something that is out of the ordinary. It doesn’t have to be expensive, it could be as simple as going to the park and having a picnic with your family. Just do something that will take your mind away from work and reduce your stress level.
• Create a work environment that you want to be in. Small things like having plants in your workspace, putting up motivational posters, and having a window to look out of can do wonders for you. If your work environment is dark and boring you’ll be forcing yourself to work everyday.

5. Stop deviating

New business opportunities are going to come your way and you will want to jump on them. But all of these things are going to be distractions. They’ll cause you to deviate from your path to success and it will take longer for you to reach your ultimate goal.

You to have to resist the temptation.

If you happen to take any of these opportunities you’ll soon find out that you will be increasing your risk intake. The more things you do, especially ones outside of your skill set, the higher the chance that something is going to fail.

Plus, the more things you do, the more spread out you will be. Once you spread yourself too thin you won’t be able to spend enough time on any of your businesses and you’ll notice that they will all suffer.

6. Never stop learning

The most important and last thing you should know is that you should never stop learning. No matter how successful you are, there is going to be someone out there who has accomplished more than you.

So instead of being arrogant, take every opportunity you get to learn new things. Whether it is from an experienced entrepreneur who has been around the block, or a 16-year-old kid, everyone can teach you something. You just have to learn what to take away from a conversation because there are going to be some things that are going to benefit you and others that won’t.

Conclusion

As an entrepreneur you have learned a few other things that I didn’t include in this blog post. Would you mind leaving a comment with some tips that would help others become a better entrepreneur in the next 30 minutes?

Well, let’s not be silly. Of course you have to make money to build a business, but it doesn’t mean you have to charge everyone. Some people have large followings and when they speak thousands listen to what they have to say. These people are known as influencers.

By helping out influencers for free they will tell thousands of people about you and your company. Not only is this good for sales, but it is great for branding.

For example, when I had my Internet marketing agency I was trying to figure out how I could get more clients. One thing that came to my mind was that everyone wants more traffic and if I could claim that big companies or powerful people were using my services, my business would explode. I didn’t know how I could get these companies or people to pay me, so I thought I would try helping a few out for free.

So I hit up bloggers like TechCrunch, Guy Kawasaki, Mashable, and Gigaom via email to see if they were interested.

Hi XXXXX,

I noticed that your blog is being read by thousands of people and it has been growing at a rapid rate according to Alexa. But you know what… it isn’t growing as fast as it should be. You can be getting a lot more traffic if you do 2 things:

1. Make your code more search engine friendly. Modifying things like your meta tags and your URL structure can help increase the amount of traffic you get from search engines.
2. You write awesome content, but you aren’t really leveraging the social web. Sites like Digg, Twitter and Delicious can drive you thousands of visitors in a single day.

If you don’t know how to do these 2 things, don’t worry, I can help you for free. I know that you are probably thinking “what’s the catch”, because there is no such thing as a free lunch.

Well after I increase the popularity of your blog I want you to tell all of your friends and colleagues what I did for you by blogging about the traffic increase you received from my services.

As you probably already guessed, this benefits me because it will increase my credibility and help me get more clients. But if I don’t increase your traffic, you won’t be obligated to write a blog post.

Now that you know you have nothing to lose, what do you think about me helping you out?

Sincerely,
Neil Patel

Now granted a lot of the bloggers I emailed didn’t care to respond to me, but a small percentage did. And by helping out a handful of influencers for free I was able to increase my credibility and grow my business.

When you are offering influencers free work, there are a few things you need to know:

• Only make the offer once – if you keep on sending emails or pestering people, it can hurt you more than it will help you. If someone doesn’t respond to your offer, it is his or her loss. The last thing you want to do is look desperate and make someone so angry that they bash you.
• Don’t ask for a lot – if you ask for a lot, no one is going to take your free work because at that point it isn’t free.
• Be upfront – if you aren’t upfront you won’t be able to get influencers to respond. An influencer gets hit up by thousands of people, so if you are up front they’ll at least respect you.

Once you get a few influencers to accept your offer there are a few more things you need to know:

• Don’t bug them – once you have helped someone out you don’t want to bug them. They are already busy, so keep your contact with them at a minimum.
• Keep on giving – never stop helping influencers. If you continue to help them and give them free work when they need it, it will go a very long way. If you stop helping them, they may forget who you are.
• Don’t call in all of your favors – if you keep on asking for favors, you will start running out of them. If you give them more than you are getting back, you’ll always be able to call in a favor when you really need it. Remember it is always better to give than to ask.

Conclusion

Working for free can help grow your business in the long run, but it won’t help in the short run. Don’t expect to get a return on your investment anytime soon. You have to be patient because it can take months if not years before your free work pays off.

Don’t worry about calculating a return on your free work; over time things will work out. You just have to make sure you are helping out influencers for free and not random people.

Attending conferences and going to local meet-ups is a great way to meet new people, but it isn’t a good way to get to know someone. If you really want to be successful at networking you have to follow these steps:

Put your feelers out there

Every time you attend an event, you’ll notice that there are a few networking whores in the room who hand out business cards to every single person they see. They usually get to know thousands of people, but when it is time to call in a favor or ask for help, no one steps up to the plate because they haven’t built any personal relationships.

The goal with networking is to build personal relationships and you don’t do this by being a whore. The next time you attend an event and are looking to network, here are a few things you can do:

1. Look for the most popular groups in the room. These groups are popular because they are made up of the “it” crowd. These are the type of people you want to be associated with for obvious reasons.
2. Once you have found the popular groups, look to see what individuals make up those groups. You don’t want to cut into a group and try to join the conversation because it will create an awkward moment. Instead you want to wait till one of those individuals leaves the group for a moment (to get food, get a drink, go to the bathroom…) and start to get to know them.
3. After you start getting to know a few people in the “it” crowd, you can then join the group they are in. This way, there won’t be an awkward moment because you’ll know a few people in the group.
4. When the conversation starts dying down, you want to get people’s contact information. You can either do this in a casual fashion by trading phone numbers or by trading business cards.

Start following up

Within 24 hours of meeting someone in person, you want to follow up with them. If you don’t, they might forget who you are. The easiest way you can do this is by sending an email like this:

Hey John,

It was great meeting you at the Seattle 2.0 Awards. We should meet-up for lunch or drinks next week. Let me know when you are free.

By the way, I noticed that your company provides design services for small online businesses; I know a few people that could be interested in your services. Let me know if you would like an introduction.

Thanks
Neil

If you read the email above, you’ll notice that I did was two things:

• The first was to give a few options on meeting up
• And the second was to offer to help them out

By doing both of those things your chances of getting a person to follow up with you will be higher. If you just invite someone for lunch or drinks, they may not respond. But if you do something for them, they’ll feel obligated to respond.

Setup a meeting

Once you get someone agree to meet-up with you there are a few etiquette rules that you have to follow:

1. Pick a meeting location that is convenient for the other party, and not just you. If you are the one who wants the meeting, why should they have to come to you? You should be the one driving to them.
2. Don’t be late to the meeting! I don’t care if there is traffic or if you have some family issues, always be on time for a meeting you setup. And if you tend to be late to meetings, it is better to be extra early than late. If the person you are meeting happens to be late, that’s fine, you just can’t be late.
3. When it comes time to pay the bill, you have to be the one paying. Don’t wait too long before you throw your credit card down, and if the other persons offers to pay, tell them that they can pay next time. The worst things you can do in this situation is split the bill in half or take time to throw your credit card down because it makes it seem like you don’t want to pay.

Build a personal relationship

Meetings don’t have to about work. Talking about money or business all the time gets boring. If you want to successful at networking you have to build personal relationships and not just business relationships. You can do this by talking about general topics such as sports, family, or anything you think may interest the other person.

When chit chatting, pay close attention to their body language. If you are feel the other person is getting bored, change the topic. You want to talk about stuff that you both find interesting.

Conclusion

Once you finish your first meeting you’ll notice that you are building a friendship and not just a business relationship. This is the secret with networking because if a friend asks you for something, you are more likely to do something for them compared to if a business colleague asked you for something.

And lastly, you’ll want to have many more meetings with the same person. You never build great friendships over one meeting you build friendships over years. So don’t expect your networking to pay off within a few weeks or months, it can take years before you see a ROI.

As a first time entrepreneur you probably have tons of questions. And every time you do a Google search for an answer you are bombarded with too much information and in some cases that information contradicts other things you have heard. Due to this, I have created a list of 54 resources that should help you out.

Legal & Accounting

Legal and accounting issues may not seem important when you are starting your company, but they are. Legal and accounting mistakes that you make early on can haunt you for years and can be expensive to fix. So if you are going to start a company you should do things right from the get go.

• S Corp. vs. LLC: Which Structure is Right for Your Business - Determining the type of legal structure for a new business can be daunting for entrepreneurs and small business owners. Learn more about S Corporations and Limited Liability Companies (LLC), and decide if one of these business structures is right for you.
• Legal Zoom – a cheap way to get incorporated.
• Findlaw – a directory of all the lawyers throughout the US.
• Bookkeeping 101: Debits and Credits - Accounting ends with score keeping but begins with record keeping. The first task of accounting is to accurately record transactions. Transactions are events that change the composition of a firm’s assets, liabilities, and equity.
• Accounting Basics - This explanation of accounting basics will introduce you to some basic accounting principles, accounting concepts, and accounting terminology.
• Docstoc – A free place to get legal documents and templates which can drastically help reduce your legal fees and in some cases allow you to do some legal stuff yourself.
• You’ve Been Sued: What Do You Do? - Everything you wanted to know about being sued.
• Opening a Business Bank Account – Business bank accounts and your identity.
• Closing Down Your Business Permanently - If you’re shuttering your business for good, there’s more to it than drawing the blinds.
• Legal Issues to Consider When Starting Your Business - There are a multitude of legal issues to think about when it comes to starting your business. Everything from your business name to its structure to its operation has legal implications.

Web Design

Design is something we tend to take for granted. Not only is important for your website to look good, but you also want to make sure it is usable and converts.

• Top Ten Mistakes in Web Design - The ten most egregious offenses against users. Web design disasters and HTML horrors are legion, though many usability atrocities are less common than they used to be.
• Google Website Optimizer - A free tool that will help you maximize your conversions.
• Web Developers Handbook - Everything you need to know about web design and development.
• CSS Vault - Web design inspiration.
• A Roadmap to Web Standards - Before you start designing your website, make sure you are complying with web standards.
• Signal vs Noise - A design and usability blog by 37signals.
• Crazy Egg - A simple tool that shows you how website visitors interact with your website.
• How to choose a website design agency - Choosing the right web design shop can be a tricky thing.

Internet Marketing

You can have a great product or service, but if no one sees it you will never make any money. Now this doesn’t mean you have to hire a marketing firm to help you out, but you could learn some basic things about Internet marketing.

• Beginner’s Guide to Search Engine Optimization - The basics of search engine optimization.
• Social Media Marketing Beginner’s Guide - Interested in leveraging the social web? Here is what you need to know first.
• Top Ten Things You Can Do To Get Blogged On - Getting bloggers to blog on your company isn’t an easy thing. If you flow these rules and you should be successful at it.
• How to Optimize Your Blog for Search Engines - What you need to know if you want your corporate blog to get traffic.
• Web Analytics: An Hour A Day - Google’s analytics guru, Avinash Kaushik, breaks down web analytics and the tracking needs you may need for your website.
• Dullest - The blog of Google’s main search engineer, Matt Cutts. Before you get into search engine optimization, you probably want to read his blog.
• MailChimp - Sending high quantities of emails isn’t an easy thing to do. In most cases your emails won’t go through unless you use a service like MailChimp.
• Banner Basics: Create Ads That Work - Banner advertising isn’t dead… you just have to learn how to effectively use them.

Hiring Employees

When you don’t have much cash in the bank, you can’t afford to make hiring mistakes. Sooner or later you are going to have to hire a few employees, so you better know what to look for.

• When to hire your first employee - if you are considering hiring an employee, you should read this first.
• 5 tips for hiring your first employee - Microsoft breaks down some useful tips for new companies.
• 9 Steps Before You Hire - 9 good tips for first time business owners.
• ADP - Payroll can be a hassle. ADP provides good payroll solutions for a very affordable price.
• How to Fire an Employee - If you hire a bad employee you better learn to fire them.
• When to Fire an Employee - Analyzing when it is time to accept that a performance improvement will not happen.
• Fully-Baked: The real cost of adding a new employee - Employees cost more than just their salaries.
• 201 ways to turn any employee into a star performer - A book that you should read if you want to maximize your employees output.
• Tsheets - Employee time tracking software.
• RescueTime - Employee time tracking and time management software.

Raising Venture Capital

Raising money can be a pain in the ass, especially if you have never done it before. If you want to raise money, you need to know the basic terminology that venture capitalists use, how to create a pitching deck, and how to get in front of venture capitalists.

• Vfinance - A directory of venture capitalists, angel investors, and business plan templates.
• Forbes Midas List - A list of the top 100 venture capitalists for the year 2009.
• The 10/20/30 Rule of PowerPoint - Before you make a powerpoint that showcases your company and how much money you are raising, you should read this.
• How to Raise Venture Capital - An detailed overview on how you can raise money.
• Venture Hacks - A blog for entrepreneurs that discusses everything about venture capital.
• The Funded - An online community of entrepreneurs to research, rate, and review funding sources worldwide.
• How To Raise Venture Dollars - Ben Elowitz who has raised over 40 million dollars breaks down the tricks to raising money.
• Paul Graham - Awesome essays about venture capital and entrepreneurship.

General Business Advice

Other entrepreneurs have already solved many of the problems you are going to face. So when you run to into these generic problems, here are some websites you can turn to.

• Inspired Startup - Successful entreprenuer Andy Liu breaks down how to take your startup to the next level.
• The 50 best business blogs - There are thousands of business blogs, but here are the 50 best according to Times.
• The Top 10 Mistakes People Make When Starting A Business - You don’t want to make any of these mistakes.
• 10 Timeless Business Tips From 10 Millionaires - If you want to be a millionaire then you better learn from them.
• Solving Your Business Problems - Start solving your problems before they even take place.
• Struggling Entrepreneur - The Struggling Entrepreneur is a free podcast series that deals with the issues, challenges and problems of the individual who wants to be an entrepreneur, but who encounters a somewhat difficult path and appears to be struggling.
• Smarta - A support community for entrepreneurs.
• Litemind - Exploring ways to use your mind more efficiently.
• Mixergy - Successful CEOs share their experiences with the masses.

Living The Frugal Life

Although it may sound sexy to be an entrepreneur, most entrepreneurs don’t make a ton of money. You are going to have to learn to live a frugal life so that you can continue to do what you love and not worry about paying your mortgage.

• Little Steps: 100 Great Tips For Saving Money For Those Just Getting Started
• 75 Painless Money-Saving Tips - Saving money can be painful, but here are 75 ways that are painless.
• Strapped For Cash? Billshrink Can Save You Thousands!
• High Yield Savings Accounts at 20 Largest Banks - If you are going to keep your money with a bank, might as well be a bank that has high yield savings accounts.
• Scrooge Strategy - 1 premium tip every week that helps you save money.
• How to Reduce Rent - Rent is probably your biggest expense, here are a few ways to reduce it.

Conclusion

There are a ton of resources out there for first time entrepreneurs, but these are the main ones I use. Do you have any other recommendations?

Update: If you feel that a specific site should be added to the entrepreneurs handbook, leave a comment and I will add it to the blog post.

I have started a handful of companies and every time I start another one, I always learn something new. If you are a new entrepreneur you are going to make a lot of mistakes, but hopefully you won’t make the big mistakes I made.

Don’t pick a stupid company name

My first two companies were called Advice Monkey and Advantage Consulting Services. The first company was a job board, but because “advice” was in the name people thought it was a career advice site and not a job board. And the name of my second company was so long that people couldn’t remember it.

The reasoning behind me picking those 2 names were that they started with an “A”. This way when someone listed out my company with all of my competitors, I was usually at the top of the list. Although the concept of being at the top of a list is a good thing, it shouldn’t be the main reason for picking a company name.

Whatever you do, make sure you put thought into picking your company name. And for some reason if you happen to pick a stupid company name, stick with it and don’t change it later on. If you happen to change your company name, you will lose the brand value that you have built up over the years.

Don’t hire a lawyer, hire a law firm

Not only is it important to hire a good lawyer, but you also want to hire a good law firm. Lawyers specialize in different types of law, such as corporate, tax, or litigation. When I hired my first lawyer, he was a one-man show and tried to do everything that I needed. He did a decent job, but he didn’t do a great job because he didn’t specialize in everything I was asking for.

After realizing that my current lawyer wasn’t too good, I decided to contact one of the biggest law firms, thinking that they could solve all my problems. But, I was too small of a client so my work wasn’t given priority, they charged me for every little thing, and the quality of their work sucked.

Sooner or later I found the perfect lawyer, Bill Bromfield, from Fenwick. He always goes out of his way to make sure I am protected, he doesn’t nickel and dime me for every little thing, and if he can’t do something I need, he recommends someone who can.

When looking for a lawyer, don’t just look for a really big law firm; look for a lawyer who will take care of you. Ideally if they work in a decent size law firm, that’s great because someone there will be able to solve your problems.

Hiring doesn’t solve all of your problems

There are four big mistakes I made when I hired people:

1. Just because someone did really well in their last job, it doesn’t mean they are going to do well in your company. For example, if they were a rock star sales person that worked for your competitor, it doesn’t mean they will be a rock star sales person for your company.
2. Hiring more employees is a lazy mans way of solving a problem. If you want to increase your sales, try to do it yourself before you hire someone. Yes in the long run you should hire employees if you want to grow your business, but if you don’t know what problems these employees will run in to, you will have a tough time managing them.
3. There are a lot more costs to an employee other than their salary. Office space, insurance, computers, and other expenses add up. The biggest of those expenses are probably management expenses to manage your employees.
4. Having virtual employees sounds great at first, but some people aren’t too efficient when they are virtual. If you have any virtual employees consider using efficiency tracking solutions like Rescue Time to see how your employees spend their time.

Slow and steady doesn’t win the race

You will love your first company like it was your own baby. You’ll want everything to be perfect and you will probably over think things. Don’t worry, this is a common way most first time entrepreneurs feel; I know I felt this way with Advice Monkey. But, when you see your first company as your baby, you start thinking with your emotions instead of using logic, which causes things move really slow.

Things don’t have to be perfect! Whatever you have now will improve over time, so get out there and do whatever it takes to make money. Because if you don’t someone else will.

Networking is the key to success

I didn’t know what I was doing with my first few companies. I didn’t have too many people that I could get advice from and I ended up winging a lot of things. After being in business for a few years you learn a few things, but you never stop making mistakes. Instead you end up making new mistakes.

If you want to be successful, you have to network. By going to conferences or local business networking events, you will learn a lot from other people. Plus if you are uncertain about specific things, you can always ask others for advice.

On the other hand if you don’t go to industry networking events, whom will you ask advice from? The best person to ask advice from is someone in your industry or your competition. Trust me, you will be amazed on how friendly your competition can be and what they are willing to share.

No one is god

When I started my first business a lot of people gave me advice because it was my first time around the block. Every time someone gave me advice I followed it because they were more successful than I was. But instead of this helping me, it caused me to run around in circles and make more mistakes.

I am not saying that you shouldn’t listen to people, but don’t take people’s word for everything. Do your own homework and make sure the advice people are giving you is right for your business.

Remember no one is god. I don’t care if they sold a company for a billion dollars, they probably don’t know your business as well as you.

Have a business partner

When you have to make all the decisions in your company by yourself, you are more likely to make mistakes. Although I had a business partner with my first business, he wasn’t active so I had to make all of the decisions myself.

Luckily I found a business partner, with the help of my sister, and we have worked together for over 6 years. The cool part about having a good business partner is that they can bring something to the table that you don’t have.

For example, my business partner is great at managing employees, coming up with our corporate strategy, and talking to investors. I on the other hand am good at sales and marketing.

It is never an easy thing to find a great business partner, so don’t rush it. Make sure you get to know the person before you go into business with them. You should also expect to get into arguments and heated discussions, so you better be prepared to deal with him or her.

Don’t be afraid of the unknown

Advice Monkey didn’t accept payments online because I didn’t know how to and I was afraid of all the problems that it could cause. I know that sounds stupid, but as a 16 year old and I didn’t know better.

My fear of accepting payments online was one of the biggest reasons my business failed. Instead of being afraid of it, I should have done research on accepting credit card payments and the implications of charge backs.

If you are afraid of something that you aren’t too familiar with, suck it up and deal with it. The worse that can happen is that you’ll stumble along the way.

Conclusion

It’s too late for me to go back in time to when I was starting out, but it isn’t too late for you. Hopefully you won’t make all of the big mistakes I made.

The chances are, you probably haven’t heard of the name Andrew Warner. And if you have, all you will see is a young man who throws local web conferences and interviews successful entrepreneurs. But the thing is, there is a lot more to Andrew Warner than meets the eyes.

Although Andrew spends most of his day interviewing successful entrepreneurs, he himself is more successful than the people he is interviewing. On top of that you can probably learn a lot more from listening to Andrew than if you listened to Internet celebrities such as Guy Kawasaki and Seth Godin.

By no means should you stop listening and learning from Internet celebrities, but you need to start listening to people who are more like you. Andrew Warner wasn’t a rich kid who had everything handed to him. He had to return his old clothes to J.Crew so he could have enough money to start his first business, and it happens to be that company made 38.5 million dollars a year.

Here is the Andrew Warner Story!

So Andrew, tell me a bit about yourself?

I’m an entrepreneur and salesman living in a world that has little appreciation for either.

In elementary school, I had this little business where I bought packs of gum from the candy store and sold each piece to kids in my class. I bought each pack of 10 for 50 cents and sold the pieces for 10 cents each. It wasn’t a huge amount of money, but I doubled my money and I was proud.

You think the teachers were proud? If a kid wanted to draw or write poetry or do anything artistic, they were full of praise. But as soon as they found out what I was doing, they shut me down. Sharing your candy with others if fine, but there was something disgusting to them about commerce.

Isn’t the same true on the Internet? Everyone cheers user-generated content. But if one of those users wants to profit from all the time he’s spending online, the community is turned off.

Ever since elementary school, I wanted to show that businesspeople are the heroes and encourage others to become entrepreneurs. After I cashed out of my Internet company, I dedicated myself to doing that.

How old were you when you started your first .com business, how much capital did you put into it, and where did you get the money from?

When I was 21, I discovered the business that would make me my first (mini) fortune. It was the mid-90s and I got this daily word-a-day email newsletter. I liked it, so I called up the guy who wrote it and said, “I love your email newsletter, but why aren’t you running ads in it? You can make some money.”

“You don’t understand,” he told me. “If I ran ads in it, it would taint my work.”

There were a bunch of email newsletter guys who felt that way. In their stupidity, I found an opportunity. My brother Michael is a brilliant coder, so I partnered up with him and in about a week, he whipped up a system that allowed us to manage our own email newsletter.

Within a year, we were making a profit of about $1,000 a day.

What inspired you to create an online greeting card business?

In the mid-90’s, people would subscribe to just about any email newsletter because email was still a novelty to them and they wanted to see something in their inboxes. As the excitement wore off, people were less likely to go out of their way to sign up for a service that sent them more email. We were constantly looking for new ways to get people to join. Michael is a fast developer, so when we saw something promising, he coded it up quickly and we measured the results.

Then I read a BusinessWeek article that changed my life. It talked about virtual gifts. There were web sites that let people email each other pictures of flowers. The concept seemed ridiculous to me, but it was insanely viral. So I showed it to Michael and in about a week he built what we simply called “virtual gifts.”

Mostly we copied the people in the BusinessWeek article, but we added one thing that I don’t think the others were doing. When users sent virtual flowers, we also let people join our mailing list.

Since flowers did well, we wanted to see what else people would want to send. We let them send virtual toys, gag-gifts, whatever. Eventually, we realized that greeting cards were the most popular, so we focused on that.

Suddenly we got hundreds of new subscribers every day–for free!

You took your business from 0 dollars in revenue to 38.5 million dollars. How did you get your revenue that high and how long did it take you to do that?

Great question!

Getting hundreds of people to send our greeting cards was exciting, but we were too ambitious to be satisfied with hundreds. We wanted millions.

So we took the basic functionality of our greeting card system and opened it up to other Web sites. Using Michael’s code, anyone could add a greeting card section to their site. And when their users’ sent out a greeting card, we asked them to join our newsletters.

Now we were getting thousands of people to join our newsletters. But remember, we wanted millions, not thousands.

That’s when we decided to pay web sites to use our system. We’d give them 10 cents every time one of their users sent out a greeting card. Now that was powerful. Suddenly millions of people were using our greeting card engine and our newsletter had millions of subscribers.

That was great, but as you can see, it’s also scary. Because for every million people who used our greeting card engine, we had to pay webmasters $100,000. We didn’t have that kind of money. The newsletter business was profitable, but revenue was slow. Every day, we made a fraction of a penny on each user. That added up to real money, but it took a long time to get that money. And the affiliates that sent us all those users didn’t want to wait.

So we needed a way to bring in money quickly.

This is where that salesmanship that teachers tried to beat out of me came in handy. I noticed that there were some venture-backed firms with a lot of money and an urgent need to get new users. So I told them that every time a user joined one of my mailings, I’d urge them to become members of the venture-backed company’s site.

They loved the idea so much that companies offered to pay us anywhere from $1 to $3 per user.

Millions of people used our greeting card engine each month. Venture-backed firms paid us $1-$3 every time we convinced those users to sign up for their services. You can see how that adds up nicely.

Your business had high profit margins. How did you keep your costs so low?

I’m amazed that you noticed our margins Neil.

Let’s do the math. We paid webmasters 10 cents every time one of their users used our greeting card engine. We got paid up to $3 by venture-backed firms every time we got those users to register for these venture-backed firms’ services. That’s how we got our margins.

Even when we raised our payouts to 25 cents, our margins were good.

But those are gross margins. From that, we had to pay for servers, salaries, office space and more.

I reached for the moon and rented a floor of office space in mid-town Manhattan. That alone cost over a million dollars a year.

So, in 2000, the only year we had our finances audited by Earnst & Young, our revenue was $38.5 million, but our net profit was $6.7 million.

You sold your company to Brad Greenspan, who was one of the MySpace founders. How did you go about selling your company?

We sold the business in pieces to people we did business with over the years.

Netcreations, for example, bought our opt-in email database. They were the leaders in that space and managed that part of our business, so they knew what it was worth and how to run it.

Brad Greenspan bought the last of the business. He was one of the few people who discovered our company on his own. He must have been monitoring traffic rating services to see whose traffic was spiking. As soon as our business hit his radar, he called me and tried to buy me out.

I turned him down, and over the years we became both competitors and friends. We competed fiercely with each other, but we also did some mutually beneficial business deals.

Brad’s company had a super-smart group of guys working in it. So when I needed to move on, I made a deal with him. I knew his guys could run the business without needing me to stick around through a long transition period.

What advice would you give to someone who doesn’t have much money and wants to start a business?

I hate the pansies who whine that “it takes money to make money.” No it doesn’t! It takes a sense of mission. If you’re on a mission, you’ll find a way.

When I didn’t have money to start my company, I called up J.Crew and asked if they’d take back the clothes I bought from them over the years and give me a refund. Believe it or not, they said, “sure.” That J.Crew refund check helped put me in business.

The problem with most people who want to start companies is that they’re not real entrepreneurs because they’re not enterprising.

I have shelves full of biographies or great businesspeople who all started with nothing but somehow found a way to build their businesses.

Any last words to the Quick Sprout readers?

Keep learning from others. We’re fortunate in the Internet business because successful entrepreneurs are willing help startups. We have to take advantage of that.

In college, I worked on Wall Street. The guy who made it in the market had zero interest in helping out the younger guys coming up.

Today I run a Web site called Mixergy, where successful Internet entrepreneurs teach others what they learned. There is no way that anything like that would happen on Wall Street. It’s too competitive and people are too ruthless.

We need to be grateful for this environment and soak up as much knowledge as possible.

If you watch the video above, you’ll notice a gentleman by the name of Nick Vujicic, who was born without any arms or legs. When he was 8 years old he wanted to end his life because he felt hopeless. But the thing is, he didn’t. Instead of hating his life, he learned to embrace it and live life to the fullest.

Just like Nick there are going to be times in your life when things aren’t on your side. The world is going to come crashing down on you and you won’t want to get up. This has already happened to you in the past and it is going to happen to you again in the future. It happens to all of us.

Now the next time this happens to you, I don’t want you to feel depressed or hopeless, I want you to suck it up and get right up. You are going to have roadblocks in your life, but you shouldn’t let them slow you down. No matter what they are, you need to keep on moving forward!

I can tell you from first hand experiences that things can turn around for you. Just look at me, most of the businesses I started failed and at one point I had a million dollars in debt. The majority of my businesses didn’t succeed, and after a while I wanted to give up. My friends and family kept on pushing me to move forward and sooner or later one of my businesses did really well. That one success made 4 years worth of failure worthwhile.

The thing I want you to learn from my experience and Nick’s, is that it doesn’t matter how you start, it matters how you finish.

So the next time you are feeling down and want to give up, I recommend watching that video of Nick. I hope he is as much of an inspiration to you as he is to me.

Times are tough! Getting a higher paying job or a second job is a great way to make some extra money, but it probably is not a realistic solution for you. A more realistic solution is to make smarter spending decisions. As the saying goes, “it is easier to save money than to make it”.

You don’t have to change your lifestyle by not buying things you want, but instead, try to save money by buying things that are on sale or look for better deals.

Billshrink

Recently, I was turned onto a new service called Billshrink. The cool thing about it is that it can help you save money on your credit card bill and your cell phone plan, without changing your spending habits or cutting back on your cell phone minutes.

Cell Phones
When you first sign up for Billshrink you are asked to enter in your cell phone number and your carrier password so that they can analyze your cell phone plan. Here is what mine looked like:

If you look at the picture above, you can see that Billshrink analyzes:

• How many minutes you are paying for every month versus the actual number you are using.
• The number of phones on your cell phone plan.
• If you use a data package.
• If you use text messaging.
• The areas in which you make calls from and the provider signal strength in those areas.
• The networks you most frequently call (Verizon, AT&T, T-Mobile, Sprint).
• What times you most frequently use your cell phone.

Based on these factors Billshrink tells you which cell phone plan/provider you can switch to and the amount you would save every month by switching. For example I am with Verizon and I pay $264.75 every month. If I switch to AT&T, I would save $2,968 over 2 years and that even includes the cost of breaking my Verizon contract. I know that may not sound like a lot of money to you, but that is roughly a years worth of cell phone payments.

Credit Cards
I currently have a Wells Fargo Visa credit card that I use to spend an average of $2050 every month. Most of that money goes towards entertainment, airfare and shopping. My credit score is good, and I pay my bill off in full every month.

What I found out about my credit card is that just because there isn’t any annual fee, doesn’t mean it is good. The Wells Fargo Visa card doesn’t have a good rewards program.

Because I am a jet setter Billshrink recommended that I switch to a United Airlines credit card. By doing this I will earn an extra $832 worth of rewards point within a year, which is two or three free domestic flights.

Deals

On top of using Billshrink, you should always look for deals. You can still buy what you want (within reason), but try to find a good price when making purchases.

Monthly Bills
In most cases there isn’t much you can do to save money on your monthly bills without changing your lifestyle. For example, if you want to save money on your electricity bill you can’t switch to a different provider, you have to use less electricity. But the thing is there are two monthly bills that you can easily reduce:

1. Television – chances are subscribing to satellite or cable TV. Check out your plan and figure out if you actually watch all of those channels. If you don’t, cancel the channels you don’t watch. Other than that, you should play satellite and cable TV providers against each other. Call them up and tell them what another provider is offering you until you get a good deal.
2. High speed Internet – there are tons of different high speed Internet options for you, all you have to do is find the cheapest and best one. Just like with satellite and cable TV providers, you can pin them up against each other. On top of that consider getting a lower high speed Internet package if you aren’t using it to download files. Trust me, you won’t notice a difference in speed.

Clothing
If you have a shopping addiction like me, you can save tons of money if you buy your cloths online compared to going to a store. For example, I shop at Banana Republic, Nordstroms, and Saks Fifth Avenue a lot. So instead of buying clothes from their retail stores, I buy them from their Internet store.

If you buy clothes from the Internet, you can use coupon codes to get good bargains. Here are some of the websites I use to find coupon codes:

• Retailmenot - find coupon codes for 20,000 online retail stores.
• Coupon Album - coupons for every online apparel store.
• eBay - you will be amazed how cheap 20% off coupons and gift cards go for on eBay.

Electronics
Best Buy and other electronics stores are a great place to buy gadgets if you want to get ripped off. Instead of going to the store to buy electronics, you should go to the store to figure out what you really like and want to buy.

After you figure out what you are going to buy, search blogs like Engadget, Gizmodo, and CrunchGear for special offers. On top of that you want to search price comparison engines like PriceGrabber, check popular ecommerce stores like Amazon, and browse eBay to see if you find a steal.

Conclusion

There are a ton of ways you can save money, you just have to get creative. What I propose to you is to leave a comment with a creative way you can save money without changing your lifestyle. Whoever comes up with the best way to save money will win a $100 from me.

A winner will be announced by 12am, Monday night (PST).

Update: The winner is Network 21.

Over the last 3 years I created 2 blogs, my first (Pronet Advertising) is on marketing and my second (Quick Sprout) is on business. Although both of my blogs do well, I made my share of mistakes. I am not a big believer in regrets and I have learned a lot over the last 3 years, but if I started all over again, I would do things very differently.

Don’t blog about news

Within your industry there are probably dozens of blogs that write about the news. So why do the same? I know blogging about the news can get you more traffic, but it doesn’t provide your readers with much value.

Pronet Advertising was accepted into Google news a few years ago, this meant that it could appear really high in the Google search results for almost any search term. Due to this, I would analyze Google trends and write on things that were hot. This was a great way to get tons of traffic, but my readers didn’t care to read blog posts that were news related.

Pick a niche

My first blog was about marketing, the problem with that niche was that there were too many blogs that already discussed marketing. Sooner or later I realized this and started blogging about social media marketing instead of general marketing. After I did this, my blog became so popular that it got into the Technorati 100.

Now I don’t have a niche with Quick Sprout, but if I had, it would be more popular. Make sure you pick a niche with your blog.

Pick a big niche

As I mentioned above, my first blog was about social media marketing. Quick Sprout also had a niche at one point and it was personal branding. Both of these niches were so small, that I got tired of blogging on them. With my first blog, I just stopped blogging on it. With Quick Sprout, I ended up changing the blog from being on personal branding to business.

You want to pick a niche, but it can’t be too small. If it is, you may run out of content ideas.

Be passionate

I wasn’t too passionate about social media marketing, which is why I stopped blogging on Pronet Advertising. If you aren’t passionate about what you are writing on, your readers will be able to tell. Just look at the content on Pronet Advertising, you can tell by reading it that I didn’t care about the blog.

Don’t burn yourself out

When I started blogging, I used to blog twice a day. I got burned out and felt that I was writing too much. Blogging shouldn’t seem like a chore, you should enjoy it. I now blog once a week on average and I love doing it. Don’t force yourself to blog to often or else you will get burned out.

Make money

There is nothing wrong with making money. If you are spending a lot of time blogging, you should be rewarded from it. With Pronet Advertising, I made money from ads and consulting deals that came through the blog. With Quick Sprout, I am not making any money from it, which is fine because I don’t care for the money I could make from ads.

If you are in a position where you don’t need money, that’s great. If you aren’t, you better figure out a way to make money off of your blog.

Don’t spend too much on a design

I spent around $5,000 getting Pronet Advertising designed. What I didn’t realize is that you don’t need to have a cool design to have a popular blog. If you look at some of the most popular blogs on the web, such as Boing Boing, there isn’t anything special when it comes to their design.

The main thing you should be concerned about when it comes to your blog’s design, is that it needs to be usable and simple.

Have a unique design

With Quick Sprout, I am using a generic blog design. It looks great, but too many people are using it. This is making my blog blend in with thousands of other blogs. Because of this, I have two options:

1. Modify the theme and make it look different
2. Change the design

Write detailed content

If you look at the blog posts that I wrote when I first started Quick Sprout, you will notice that they aren’t too detailed. Until the last month or two I continued to write sub standard blog posts and because of this Quick Sprout wasn’t growing. Once I started writing detailed blog posts, my traffic increased and you started to enjoy reading the blog.

Respond to every commentor

The biggest mistake I made was taking commentors for granted. If I responded to every commentor since the first day I started blogging, I would have built tons of relationships. After I started to respond to every comment, I got to know a ton of people on a personal level, such as you.

Build relationships with other bloggers

If you want your blog to be popular, you better get to know other bloggers. The easiest way to make your blog popular is to get other bloggers to blog about you and your blog. Sadly, I didn’t figure this out until a year into blogging.

After I figured this out I started building relationships with many of the top bloggers. When I launched Quick Sprout I told these bloggers and they naturally blogged on it. This lead the blog to have a 1000 RSS subscribers within the the first 24 hours of launch.

Pick the right blogging platform

My first blog was on Movable Type and this one is on WordPress. I had tons of problems with Movable Type such as comment spam and worst of all it wasn’t easy for me to make changes. Due to this I had to spend a lot of money on Movable Type developers. Once I switched to WordPress I was able to do everything myself. This saved me a lot of money and time.

Don’t write for Digg

Pronet Advertising did very well because it got on Digg a lot. Digg traffic caused the blog to grow like a wild fire, but it caused me to lose my core reader base. On the other hand Quick Sprout hasn’t got on Digg more than once and I have a very strong core user base. This is the main reason Quick Sprout has tons of reader interaction compared to other blogs.

Tell your story

Open up to your readers by telling them your life story. I didn’t do this during my first few years of blogging, but now I have a very detailed about page. I wish I did this from day one because it creates a stronger bond between you and I.

If you don’t have a detailed about page, you should consider writing one. Don’t be shy, make sure you open up to your readers.

It’s not about you

Who doesn’t want to write about their accomplishments? Bragging may sound cool, but people don’t like it when you brag. I did this a bit when I started Quick Sprout, but luckily Darren Rowse from Problogger set me straight and showed me why it isn’t wise to brag.

If you want to do well in the blogosphere, write with the intent of educating, not to brag.

Over the past few years I worked with 30 of the top 100 blogs to help them increase their traffic. The thing that all of these blogs have in common is that they have great content. But one thing that most of these blogs didn’t do right is leverage search engines.

Search engine optimization doesn’t have to be complicated. As long as you follow the instructions below, you can optimize your blog within 30 minutes.

Title Tags

You may not know what a title tag is, but you have seen it. Every time you perform a Google search, websites with relevant title tags usually so up towards the top of the page. For example, I searched for the term “Neil” in the image above. Most of the results have the word “Neil” in the title tag. This means that if you want to rank for a specific term, it should be in your title tag.

Take a look at your blog’s source code, the title tag will be close to the top and it will look something like this: <title>Quick Sprout - I’m Kind of a Big Deal</title>. Ideally your title tags should be descriptive, short, unique, and somewhat keyword rich. With a blog though, the title tag of each page is the title of your blog post, but this doesn’t mean you can’t optimize it.

WordPress
If you have a WordPress blog go into your header file and replace your title tag code with this:

<title><?php if (is_home () ) { bloginfo(’name’); } elseif ( is_category() ) { single_cat_title(); echo ” - “; bloginfo(’name’); } elseif (is_single() || is_page() ) { single_post_title(); } elseif (is_search() ) { bloginfo(’name’); echo ” search results: “; echo wp_specialchars($s); } else { wp_title(”,true); } ?></title>

Movable Type
If you have a Movable Type blog, replace your title tag code with this:

<title><$MTEntryTitle$></title>

Meta Description

If you look at the image above, you will get a good understanding of what a meta description is. A meta description is a short sentence that describes what a web page is about. Each meta description tag on your blog should be unique, short, and descriptive.

Writing a unique meta description for each of your blog posts can be time consuming, which is why I recommend making the first sentence of each of your blog posts your meta description.

WordPress
The Head Meta Description plugin automatically adds a unique meta description tag to each of your blog posts. Just download it, upload it to your server, active it, and set it to 25 words.

Movable Type
I don’t know of any plugins that do the same on Movable Type, but through your post template code you can do the same thing. Just add this line of code:

<meta name=”description” content=”<$MTEntryBody words=”25″$> …” />

Sitemaps

You could create an HTML sitemap on your blog to increase the number of pages search engines index, or you could create an XML sitemap. I personally recommend going the route of creating an XML sitemap and submitting it to the search engines.

After you create your XML sitemap you can submit it to Google Webmaster Central, Yahoo Site Explorer, and Live Search.

301 Redirect

Some people have a tendency to link to http://yourdomain.com and others tend to link to http://www.youdomain.com. Both of those URLs may look the same, but one contains a www and the other doesn’t. So if 100 websites link to the non-www version and 1000 websites links to the www version, search engines may see both of those URLs as separate pages even though they are the same site.

You can solve this by adding a 301 redirect in your htaccess file.

Options +FollowSymLinks
RewriteEngine On
RewriteCond %{HTTP_Host} ^YOURDOMAIN.com [NC]
RewriteRule ^(.*)$ http://www.YOURDOMAIN.com/$1 [L,R=301]

Another way you can solve this is through Google Webmaster Central. In Webmaster Central (under the settings tab) you can tell Google to pick the www or non-www version of your domain. Although this is an easier solution than modifying your htaccess file, you should still do both because Google Webmaster Central doesn’t affect how other search engines see your blog.

Duplicate Content

If the same piece of content is on more than 1 page of your blog, you will have duplicate content issues. The more duplicate content you have on your blog, the less search engine traffic you will get. In most cases the same piece of content will be on your home page, the post page, and in your category achieves. Here is how you can get rid of your duplicate content:

PageRank Sculpting

If you have the Google Toolbar installed on your computer, you probably know what PageRank is. If you don’t, it is a numerical value from 1 to 10 that websites get. 1 means that a website isn’t that important and 10 means that a website is very important.

A good way to increase your Google PageRank is to control your links. If you have too many links on a web page, that page’s PageRank can decrease. Now this doesn’t mean having ten or twenty links on a page is going to hurt you, or that you shouldn’t link to other sites. In other words, you should not link out to 1000 other pages when it doesn’t provide any value to a user. A good way to solve this problem is to “nofollow” links.

Nofollow is an HTML attribute value used to instruct search engines that a hyperlink should not influence a web pages ranking. The code you can use to nofollow certain link is:

rel=”nofollow”

The links I recommend nofollowing on your blog are things like contact pages, terms of service, comment links, privacy policy, and read more links. You can pretty much nofollow the second instance of any duplicate link on a given page.

Image Search

People don’t just search for web pages, they also search for images. Search engines aren’t smart enough to decrypt an image and tell you what it is, like humans can. But through code you can help a search engine figure out what keywords your images are related too.

You can optimize your images through 5 easy steps:

1. Enable image Labeler in Google Webmaster Central. (you can find it under the settings tab)
2. Give meaningful names to your images. For example, GreenToyotaCamry.jpg is better than image1.jpg.
3. Add long description tags to your images. For example: longdesc=”1998 green Toyota Camry driving down the highway”.
4. In addition to a long description, an alt tag should be used as a short description. For example: alt=”Toyota Camry”
5. Lastly, you want to upload big images. Bigger images usually have a higher priority than smaller images.

Conclusion

After you do all of these changes, your search engine traffic should increase. Just be patient because it could take a few weeks before you start seeing any increases in traffic. If you have a brand new blog, don’t expect to get much search engine traffic. It can take months before you start getting a lot of search engine love.

If you have any questions, feel free to post a comment.

When I was 16 years old, I decided I was going to try to find a job because I needed money. The only way I knew how to do so was by searching job boards like Monster. While I was searching Monster I noticed a small link at the bottom of their website, which was a link to their stock quote.

At first I thought Monster was just another .com company that was making a few million dollars, but after analyzing their income statement, I realized that I was wrong. The company was actually earning hundreds of millions of dollars a year.

It was at this moment that I was inspired to create my first .com company. And naturally it ended up being a job board called Advice Monkey (I no longer own AdviceMonkey.com). My reasoning behind creating a job board was that if I could make 1% of Monster’s revenue I would be a rich kid. Sadly Advice Monkey never made any money and within two years I closed it down. Here is why it failed:

Solve a unique problem

The concept behind Advice Monkey was to help people find jobs through the web. Sites like Monster, Career Builder, and Hot Jobs solved that problem years ago. So why would anyone visit my website? Honestly, there was no reason.

Make sure your company is solving a unique problem that others haven’t solved yet. You may make some money creating another me too company, but your chances are slim to none.

Now this doesn’t mean you can’t enter a saturated market. You just have to find out what problems exist in that market and figure out how to solve them.

Be scrappy

I only had a few thousands dollars when I started the company, but that didn’t stop me from getting what I wanted. I posted a few messages on some popular web forums and convinced a developer to build me a website that was similar to Monster.com.

Although I may have seemed to be a scrappy guy, I wasn’t. If I was slick, I would have been able to get the website built for FREE. I could have pitched my vision to a developer and convince him to build the website in exchange for some equity in the company.

If you don’t have much money, don’t worry; you can still start a company. You just have to be scrappy and convince others to help you out for free. You will be surprised on how many people will trade their time for equity in your company.

Don’t get too comfortable

Getting your website up and running is the easy part. After it is up, you have to continually maintain and improve it. I did very little maintaining of Advice Monkey and it didn’t change with the times. This caused visitors to visit my website once and never come back again.

The web is evolving everyday. If you don’t evolve with it, you will not survive. Sooner or later your competition is going to make the necessary changes to evolve with the times.

A good way to evolve your website is to get feedback from your visitors. Remember, it doesn’t matter what you want, it’s all about what your visitors want.

Have a marketing plan

I know this sounds dumb, but a lot of people don’t think about driving traffic to their website until they launch it. When I launched Advice Monkey, within the first few months, no more than a 1000 visitors came to the website. To solve this problem I hired a few Internet marketing firms, and most of them didn’t drive more traffic, all they did was take my money and run.

Before you launch your company, have a marketing plan. Figure out how you are going to create buzz right when you launch your company and how you are going to continually grow it. Most importantly don’t take the easy way out by paying a good Internet marketing company, do the marketing yourself. You can do this by:

1. Optimizing your website for search engines.
2. Creating a viral website.
3. Asking bloggers to blog about your website.

Simplicity is the ultimate sophistication

To compete with my competition I added all of the features they had plus more. I thought if I had more features, sooner or later people would start using Advice Monkey. The features made the site complicated and hard to use, which caused my traffic to drop.

Features can be great, but only add them to your website if they really help your visitors. There is nothing wrong with being the most simplistic and easy to use website on the web. Some of the most popular websites, such as Google, succeeded because they were the simpler solution.

Don’t be afraid of your competitors

The easiest way you can grow your website is by leveraging your competitors’ traffic and data. I leveraged other job boards by importing their job openings into my website. I also got them to add Advice Monkey on their partner’s page, which helped drive traffic.

The key with partnerships is that they have to be mutually beneficial. You want to reciprocate the same amount of value that you are receiving, if not more.

I didn’t start embracing my competitors until a year into the business. Don’t make the same mistake I did and try to partner up with as many related websites as you can from day 1.

Conclusion

Although I made a lot of mistakes with Advice Monkey, it still could have succeeded. The problem was, I didn’t learn from my mistakes. If I realized them when Advice Monkey was still around, I could have made the necessary changes to improve upon it.

Hopefully you won’t do the same.

Raising venture capital isn’t the easiest thing to do. With my first software company, Crazy Egg, my business partner and I spent 6 months doing a dog and pony show in front of 21 venture capitalists and none of them were willing to give us money.

We thought we had everything venture capitalists (VCs) wanted. We had a unique product that solved a pain in the market, there was a lot of good buzz about us in the blogosphere, our user base was growing, and we even had paying clients. To take it one step further, people talked about how our product was so good that Google should buy it. And on top of that I had well-established relationships with VCs such as Guy Kawasaki.

So why didn’t Crazy Egg get funded? Crazy Egg wasn’t an idea that had the potential to be sold for anywhere near 100 million dollars. The business model that VCs have is that they convince rich people to invest in them and they take that money and invest it into a handful of companies. The majority of those companies will fail, but a few will end up selling for large sums such as 100 million dollars. The money that they make from the companies that sell usually covers their loses and the money they owe their investors.

Now if you failed at raising money, like I did, it doesn’t mean you should quit. Just because someone tells you “NO” the first time, it doesn’t mean they won’t say “YES” in the future. For example one of the venture capital firms I pitched Crazy Egg to was True Ventures. Although True Ventures said no to Crazy Egg, 6 months ago they invested in a company I co-founded called KISSmetrics.

The Venture World

Before you go out and start raising money, there are a few things you need to know:

1. Venture capitalists don’t want to hear about ideas; they want to see your company lunched before you ask them for money. If you weren’t willing to put the time and money into launching a beta version of your company, why would they want to give you money?
2. VCs aren’t the smartest people out there, but it doesn’t mean they are dumb either. Don’t blow smoke in front of their face or else they will call you out on your bullshit. Be honest every time they ask you question and if you don’t know the answer, it’s OK to say that you don’t know.
3. There are 3 different types of capital you can get: early stage, expansion capital, and buyout capital. Before you start your dog and pony show, make sure you know what type of capital you are going after.
4. If you are trying to raise a few hundred thousand dollars, you are better off pitching angel investors. Most VCs tend to shy away from investing small amounts of capital.
5. Business plans are bullshit. You may think they are great but I haven’t seen a VC ever read a business plan or fund a company based off of one. I could be naive, but I think they would rather have you spend your time on launching your company compared to writing a 30-page document.
6. People are scared to give money to people they don’t know. If you don’t know any investors you better start getting to know them. You can easily do this by reading and commenting on their blog or by striking up an email conversation with them. Or you could ask your friend or lawyer if they can introduce you to a VC (good lawyers know a ton of VCs).
7. In most cases VCs are using other rich people’s money to invest in companies and not their own. This means that they have a boss. So if you hear horror stories about companies getting screwed by them, it isn’t the VC who is being mean. They have to cover their ass as well.
8. Make sure a 5 year old can understand your business model. If you can get a 5 year old to understand what you are doing, then a VC will understand what you are doing.
9. There are 2 types of investors out there, the first can just provide you with money and second can provide you money and knowledge. The second type of investor is called a strategic investor; ideally you should only take money from a strategic investor.
10. If you are looking to raise a few million dollars or more, you usually won’t get it all from one venture capital firm. You will have to get money from multiple VCs, but the good news is they believe in the herd mentality. This means that if one VC sees that another VC is interested in giving you money, then they too are naturally interested in giving you money.

The Deck

Now that you understand how the world of venture capital works, you will need to create a power point presentation (also known as a “deck”) that you can use to pitch VCs. Here is an example of a good deck:

When you’re creating your deck, make sure it includes the following:

• Mission statement – a simple sentence that explains what your company is about and what you are going to do.
• Team – you need more than a one-person team if you want money. If you can’t convince people to join your company before you get venture capital, you won’t be able to convince a VC to give you money.
• The problem – creating another me too company won’t do any good. Make sure there is a pain your business can solve that others have not.
• The solution – don’t just go into how you are going to solve the problem you talked about in the previous slide, show it. You should include some screenshots of your product, even if they are rough.
• Competition – even if you don’t think you have competitors, you do. List out your closest competitors and talk about how your solution is different.
• Market size – go into detail on how big the problem is. How many people are experiencing this problem? How are you going to go after those people?
• Business model – you have to make money sooner or later. If you don’t have a strong sense of direction on how you will make money, list out the possibilities.
• Marketing – how are you going to go to market? You need a clear plan of act. Make sure you don’t say something stupid like you are going to get on TechCrunch and thousands of people will then come to your website. TechCrunch is a great site, but that isn’t a marketing plan.
• Financing – how much money do you need and why? Unexpected things usually happen, so make sure the number is large enough to account for them.
• Milestones – if someone gives you money they will want to know when they will see something more tangible.

After your presentation is over, you are going to get bombarded with questions. There is no way you can be prepared for all of the questions. Just be honest and have faith in yourself. If you know your business like the back of your hand, you shouldn’t have any problems. The most common questions I have been asked are:

1. Why do you want to raise money?
2. Why should I give you money?
3. What makes your product or service different than your competitors?
4. What is stopping your competitors from doing what you are proposing?
5. What would you do if you weren’t able to raise any money?

Conclusion

Guy Kawasaki once said that the probability of an entrepreneur getting venture capital is the same as getting struck by lightning while standing at the bottom of a swimming pool on a sunny day. No offense to Guy, but I think your odds are much higher than that. It doesn’t matter what skin color, age, or education you have. All sorts of people have raised money and you can too.

From what I can tell the entrepreneurs that are the most successful in raising money tend to be scrappy, quick learners, cheap when they need to be, and most importantly know how to execute.

Best of luck!

Over the past 6 years I founded 9 .com companies. Most of the companies failed miserably and lost me a million dollars or so, but luckily a few of them did well enough to cover my loses. The main reason I had a lot of unsuccessful ventures is because I made some really big mistakes. Hopefully you can learn from my mistakes and not make them.

Don’t spread yourself too thin

A lot of good opportunities will come your way and your gut reaction will be to do them all, but don’t. I made this mistake and what ended up happening is that all of my businesses suffered, even the ones that were doing well. Within 3 to 6 months of me spreading myself too thin all my businesses suffered because I hadn’t spent enough time on each of them, even though I had employees and business partners who were helping me out. Remember, no matter how big or small your business is, you have to spend all of your time on it.

Pick the right type of incorporation

Not only is it important for you to incorporate your business, but it is important to get the right type of incorporation. It may not seem important when you are starting your company, but once you start making money it becomes a huge deal. For example, my accountant tells me that if your company makes under $200,000 in profit a year, a C corporation is good for you due to tax benefits. If you make more than that, consider getting an S corporation or a limited liability company.

I found this out the hard way, when my company started profiting 7 figures a year I had the wrong type of corporation. I ended up getting taxed twice, the company paid taxes on the profit and then I paid taxes on the dividends I got from the company.

Be careful whom you trust

I was working with a few developers and engineers for 3 months and they came to me with a business proposition. The first 3 months of working with them went well, so I decided to hear them out. The businesses opportunity they presented was supposed to revolutionize the hosting industry, but the catch was, they were broke. After hearing them out I ended up giving them some money for living expenses, I bought them a house to live in, and I was dumping 4 to 5 figures into the company every week.

To keep a long story short, they screwed me out of my money, stole stuff from the company, and ruined the house I bought. No matter how well you think you know someone, be careful, because you don’t know who is going to screw you over. One stupid mistake can make you lose thousands of dollars.

Have a thorough hiring process

If you really want to grow your company, you will need employees. You’ll probably post some job openings to find these employees or ask a few friends if they know anyone that you could hire. No matter how you get your applicants, go through each person with a fine-tooth comb. If a friend recommends someone, it doesn’t mean that they’re a good hire. I made this mistake multiple times by hiring developers, designers, and sales people that friends recommended. Just because someone did well at their last job, it doesn’t mean they will do well working for you.

Make your employees accountable

If you aren’t strict with your employees they will start slacking off after a while. And if you travel frequently like I did, they will really start messing around when you aren’t there. The first day a new employee starts, you need to be strict with them because it is hard to get employees out of bad habits.

During the first few years of being an entrepreneur, I didn’t hold any of my employees accountable. Every time they told me something, I took their word for it. On top of that I wasn’t strict when people came in 30 minutes late and after a while it became a daily habit.

To solve this I started using project management software, like Liquid Planner, and I made each one of my employees upload what they completed at the end of each day. This way I could keep track of what each employee did.

On top of that I made every one clock in and out. This allowed me to see who came in on time and who didn’t. At first I didn’t think it was a big deal that a few of my employees came in 30 minutes late each day, but over a course of a year it added up to 3 missed weeks.

Collect your money on time

Making money may seem like a hard thing, but collecting money from people can be even harder. In 2008 I worked for 8 companies that never ended up paying me. This wasn’t a few dollars either, a few companies still owe me over $100,000…sadly I don’t think they will end up paying.

With your business collect the money first before you provide anything. No matter how large a company may be, they can still go bankrupt. Things like contracts and debt collectors won’t help you much if the company doesn’t have money.

And for some reason if someone owes you money, whine to them until you get paid. If you act like you don’t need the money, you’ll never get paid. But if you whine and act like you are in financial trouble, hopefully they will feel sorry and pay you.

Time is not on your side

Especially with your first company, you will want everything to be perfect. The reality is, there will always be problems and nothing will ever be perfect. So instead of trying to make everything perfect, just launch your company before someone else beats you to the punch.

With my first software company, I wanted the software to be perfect before I launched it. I took so long in trying to make the software perfect that Google launched a competing product before I did. After that I had no chance of succeeding because Google’s product was free and mine wasn’t.

Conclusion

No matter what, you are going to make mistakes in life. Even if I told you every mistake that I made, you will still make more. If you want to succeed you can’t give up!!! Sooner or later you will do well, but like anything worth while, it takes time.

The number 1 reason businesses fail is because they don’t have enough money. Whether you plan on owning a business or not, this is important for you to know because you work for someone. And that someone is a business. The people who tend to keep their job the longest are usually good at sales because if you are bringing in revenue it doesn’t make sense for your employer to fire you.

Whether you are an engineer, a receptionist, or a manager you should learn how to sell. I know selling sucks, but the skills you learn will come in handy. You sell yourself all the time, such as when you go to a job interview you are selling a company on why they should hire you. Here are a few things you need to know if you want to be a great sales person:

1. Practice makes perfect – if you don’t try to sell, you will never get good at it. It doesn’t matter what you know or what you don’t, just pick up the phone, make a few cold calls, and sell. Don’t expect to make a sale on your first call, just keep on selling until you are comfortable doing so.
2. Act like a punk – being a nice guy won’t get you anywhere. If you are too nice you are just going to be ignored or even worse, walked on. If you show a bit of arrogance at least you will get some attention.
3. Sales are always being made – a sale is being made every time you make a pitch. Either you sell to the customer or he sells you on why he can’t buy from you. If you want to be the one closing, you better have a rebuttal for every one of his excuses.
4. Do a sound check – if you sound dull and boring you are going to put people to sleep. Record your voice and play it back because you sound different then you think. Ask your friends and family how you sound…get as many opinions as possible. If your voice doesn’t sound great, practice until it does.
5. Studying pays off – knowing who you are selling to is really important. You want to know a person’s hot buttons so you can push them. And more importantly, you want to know about them, so that you don’t accidentally say something stupid that offends them.
6. You have an opportunity of a lifetime – if you act like you don’t you won’t close anyone. You need to act like you have a great deal that won’t last forever. Who doesn’t want a good deal? Especially one that is better than what your friends and family got.
7. Numbers add up – the more sales pitches you make, the more deals you are going to close. Sales is a numbers game, so you better hustle and make the most out of each day.
8. Time is money – your time is worth money and make sure others know it. When you are making a pitch make sure they know that you have other people to talk to as well. If you give someone too much attention you will seem too desperate.
9. You’re the man – no one takes sales people seriously. You are not a sales person, instead you are whoever you want to be. You can be the CEO of a company or anyone you can imagine. If you act like you’re the shit, you won’t get treated like shit.
10. Be persistent – if you give up or start slacking, you will never succeed. Sell, sell, sell and never let anything put you down. Keep in mind that it could take months before you close your first deal.

And on a final note, before you go out and start selling you should have some fun and watch the movie Boiler Room. There are some great sales scenes in the movie that you can learn from…

The First Sale

Telemarketing

The ABC’s

If you have watched American Gangster, you have probably heard of the quote: “the loudest one in the room is the weakest one in the room”. When Denzel Washington said that, he was trying to explain how he had tons of problems when he was showing off (being loud), and how he had very few problems when he wasn’t showing off.

Now granted, Denzel Washington was a drug dealer in the movie, which is why he had tons of problems. Although you aren’t involved in illegal activates (or at least I hope you aren’t) you should try and be low key because showing off won’t do much good for you.

For example I try and stay humble by doing things like driving my mom’s beat up Honda Civic, which is 10 years old. Even worse, my mom’s daycare business, Tina’s Daycare, is advertised on the car.

You can be loud by bragging about your financial status or by buying luxury goods that make you stand out. If I started driving around a Ferrari, all that it will do is cause more people to snoop into my business and try to compete with me. Also, playing it quiet has three huge benefits:

1. More money – if you don’t waste your money on things like a fancy car, you will have more of it. When you are doing well having money is never a problem, but you never know what is going to happen. What happens if the economy goes into another recession? Or even worse, what happens when more competitors’ emerge and they start eating at your market share?
2. Respect – a lot of people will respect you if you show your wealth or talk about how successful you are, but those people usually aren’t important. In most cases they’ll either get excited or jealous of you because they want what you have. On the other hand if you don’t show off you will get respect from people that can help you get further in life. For example people who are smart don’t easily get impressed when someone brags about their success, they get turned off. Just look at Britney Spears and Paris Hilton… they are very flashy, but you probably don’t respect them.
3. Clear path – when you start spending having enough is never enough. Once you start on the path of buying to impress there’s always something bigger to buy, where as when you’re frugal you can see the bottom. If you haven’t made it yet, it is better for you to stay closer to the ground so that you know where you are going. Plus, there is always someone who is going to have more than you.

Of course, knowing that you should keep a low profile and actually doing it are two different things. Thankfully, these two simple steps will make it a lot easier to actually BE quieter:

• Think twice – before you do things like make a luxurious purchase or brag, think it through. Acting on impulse is what causes you to do stupid things. Especially when it comes to making extravagant purchases, sleep on it before you make a decision. Hopefully after a good nights rest, you will come to your senses.
• Shut your mouth – every once in a while you’ll do something that you are proud of, instead of talking about it, keep your mouth shut. Showing off will not get you anywhere. On top of that you probably want to shut your mouth when it comes to talking about your business and the unique ways you are making money. If you don’t have a business and are planning on creating or buying one, be careful who you mention that to. The less people that know about your business, the better.

Lastly, you may tend to be loud because you think it will make you feel better. The reality is, it won’t! Plus, it’s easy for American Gangsters to find loud people in dark rooms. So SHH!

Finding a mentor can be a difficult thing to do. Over the past few years I have had many mentors, but the best one by far has been Andy Liu. Here are a few qualities that Andy posses and that you should look for in a mentor:

• Success – if your mentor isn’t successful, then how can you expect them to help you become successful? (The first company Andy started was bought by Aquantive, which then Microsoft bought)
• Rags to riches story – you probably have had a tough life, so you want to make sure your mentor can relate to you. If his or her family has always had money, then they probably won’t be able to understand what you went through and where you need help in life.
• Time – if someone doesn’t have time to spare, they won’t be able to help you. In most cases the older the person is, the more time they will have to spare.
• Abundance of knowledge – the job of a mentor is to help you with the problems you face in life, and not just the problems you face with your business or career.
• Good heart – there are a lot of things in this world that are unethical to do, but yet legal. You want someone with good morals to help you or else you may start doing unethical things.

After you find a potential candidate, here are the steps you can take to lock them in as your mentor:

1. Make them your friend – before you ask anyone for anything, you should get to know them on a personal level. No one likes being asked for favors from people they barely know.
2. Spend time with them – you won’t know a person’s true colors, unless you spend a lot of time with them. Make sure you hang out with them in a group as well as in a one on one environment.
3. Help out – before you ask for any advice, you should help him or her out in any way you can. More importantly help them out on numerous occasions and do it because they are your friend.
4. Ask for advice – asking someone to be your mentor will create an awkward situation, instead you should just ask them for advice whenever you need it.

Now that you know how to get a mentor, you could go out and find one, or you could use mine. Here are a few things that I learned from Andy:

Everything is bargainable

When you walk into a retail store you can negotiate the price of any item in the store. For example when Andy was in college he went into a sporting goods store to buy some weight lifting equipment. The price tag for the equipment was $150, which Andy thought was too expensive. So instead of not purchasing it or waiting for a sale, he went to the store manager and negotiated the price down to $110.

I know you may be a bit shy to do what Andy did, but there is no reason you should be. Making money is one way to become wealthy, but saving it is an easier way.

Think twice before you start living a lavish lifestyle

A year ago I started spending a bit of money on myself. I started buying things like $600 shoes and $10,000 watches. Last month I was tempted to buy an Aston Martin, but before I did, I consulted Andy. The two things that he pointed out to me were:

1. After you start buying expensive stuff, you keep on doing so. It becomes an addiction and an expensive habit that is hard to get rid of.
2. Why spend $120,000 on a car when all you need is something that takes you from point A to point B. Instead of wasting that much money on a car, why not donate a $100,000 to a group of people and change their lives. (Every year Andy goes to South America to give poor kids computers and Internet access)

When it rains it pours

You don’t know when there is going to be a rainy day, so you better save your money while you can. With my first business I thought everything was great when I started making the “big bucks”, but just like anything good, it never lasts forever. Because of the advice Andy gave me, I was able to pocket most of the money I earned, which has helped me survive this recession.

Don’t forget the little guy

You never know who is going to be the next Bill Gates or Warren Buffett. Instead of ignoring the little guy, you should listen to them and help them out. Plus, if you look at the whole picture, the little guys make up the majority of our population. So if you want to appeal to the masses the key is to go after the the little guys.

Overall Andy has taught me a lot of things, so instead of rambling on for hours on what he taught me, I want you to learn directly from him. You can do this by reading his blog, or by sending him an email and striking up a conversation with him. Hopefully he helps you succeed in life, similar to how he has helped me.

P.S. if you want another mentor, I can also be of assistance.

2009 has already begun and you probably have a rough idea of some goals that you want to achieve during the New Year. There is nothing wrong with your list, but you probably want to add a few things that will make the rest of your life better.

Here are a few things that you should consider adding that will benefit yourself:

1. Get rid of your loser friends – hanging around with people that bring you down won’t do much for you, so might as well stop hanging around with them. Some of the qualities that these people usually have are: no motivation to make money, laziness, drug addictions and always having a negative attitude. A good way to figure out which friends to continue hanging around with and which ones not to is by creating a two sided list; one side with your good friends and the other side with your bad friends.
2. Grow a backbone – you need to speak up more, if you don’t people will continue to walk all over you. Don’t take shit from anyone and more importantly don’t take shit from your boss when he or she is wrong. Now granted you don’t want to be a dick, but you should learn to say NO more often.
3. Network, network, network – you should go to at least 1 networking event every month. I don’t care if you live in the boonies, there are probably networking events within an hour of where you live. These networking events don’t have to be related to your profession, they can even be things like a PTA meeting. The more people you get to know on a personal level, the better off you are. You never know whom you might need help from in the future.
4. Stop judging people – its’ human nature for us to judge people by their looks, smell and even behavior. I even judge people, but we all need to stop. It doesn’t do any good to judge people, so why should we keep on doing it.
5. Invest time into your brand – similar to Pepsi, McDonalds, IBM, and Pfizer, your name is worth something. Create a blog, join all of the major social networks, and create a good business card. The more you do to build up your name the easier it’s going to be for you to get a good job, or even start your own business.
6. Learn to not be comfortable – staying inside of your comfort zone will stop you from experiencing new things. I know it gets scary when you get out of your comfort zone, so just take baby steps by doing something small every month that you would normally be terrified to do. After a few months, start doing bigger things until you learn to fully get out of your comfort zone.
7. Love money and have a drive to earn more of it – I understand that you may not care about money, but you need it to survive. With money you can give your kids the education they deserve and the experiences in life that you never had. You don’t have to be rich, but make sure you make enough money to live a decent life.

And here are a few things you should consider adding to your list that will benefit other people:

1. Help someone in need – everyone needs help sometime or another, so the next time you see someone who is really in need, consider helping. What I mean by someone really being in need, is that they have a fatal disease, or something crazy is happening to them that isn’t in their control. One way or another you should consider helping them out in ways that aren’t just financial. For example consider donating blood a few times a year.
2. Live a green life – we all live on this planet and drain its resources. If we all started doing things like recycling, driving eco friendly cars, and leveraging solar power we will leave our future generations with a better world. I know living an eco friendly life can be costly in the short-run, but in the long run you will save money.
3. Rescue an animal – we aren’t the only ones on this earth. Animals such as dogs need rescuing, if they stay in the pound too long they usually end up getting killed.
4. Support a cause – there are a lot of things out there that you can support so stop wasting time and support one. For example I support the American Cancer Society and whenever I can, I donate money to it. Even if you don’t have much money to donate to a cause, you can still donate your time.

Anyone have any other suggestions?

If you want to be rich, you need to start diversifying where you are investing your time and money so that you can increase your odds of being successful. You probably aren’t thinking about diversification because you don’t have that much money, but whether you have 1000 dollars or a million, you can be diversified.

But before I go into different ways you can get your hand into a lot of cookie jars, here are some diversification strategies that you need to know about:

• Don’t put all your eggs in one basket – this may seem like a simple concept to understand, but most people put all of their eggs in one basket. For example if you buy 10 rental homes, you are putting all your eggs in the real estate basket even though you own 10 homes and not just 1.
• Don’t get too greedy – no matter how good an investment looks, never put all your money or time into it. Keep in mind if you decide to be greedy all it takes is one unforeseen circumstance before you lose your shirt.
• Slow and steady wins the race – if you have $10,000 to invest, don’t spend it all right away. You don’t know what opportunities lie ahead so make sure you spread out your money so that it lasts around 5 years. Hopefully by the end of 5 years you will start seeing a return on some of your earlier investments.
• Cash is king – you don’t want all of your money tied up incase you need it. Due to this you want a percentage of your investments to be flexible enough where you can pull out your money whenever you need it. For example if you invest in a stock, you can sell it whenever you need money. On the other hand if you invest in a home you can still sell it or refinance it if you need money, but it may take some time to do so.

Now that you understand the ABC’s of diversification, here are some ways you can have your hand in multiple cookie jars:

1. Why have 1 job when you can have multiple jobs – working for one company can be very risky. For example who would have thought companies like Lehman Brothers would ever go bankrupt? A good way to protect yourself is to take on consulting gigs on the side of your 9 to 5 job. For example if you are a marketer for Ford Motors there isn’t any reason why you can’t help a financial or furniture company with their marketing. The basic principles behind a profession can usually be applied to multiple industries.
2. Your time is worth more than just money – when you spend a few hours helping a company, you will usually receive cash compensation for your time. Instead of taking money from various businesses, why not take equity? Having equity in companies that you believe in is never a bad thing. In the short run you may not make much money by doing this, but in the long run you can make a lot more.
3. Investing in the stock market doesn’t have to be expensive – there are a lot of people who make money by investing in penny stocks. Just look at Timothy Sykes who turned $12,000 into $2,000,000. If you don’t know much about the stock market, don’t worry; there are a lot of blogs that give stock tips.
4. Real estate can be affordable – no one says you have to buy an investment property in California. There are properties out there that you can buy for 50 or a 100 grand. The way rental properties work is that if you buy a place for $50,000 and put a 20% down payment, you’ll end up paying $10,000 for a place that is worth $50,000. The rental income that you receive every month should pay for the mortgage payments and after 30 years the home should be paid off. 30 years later, hopefully the home is worth $150,000. So if you decide to sell it, you’ll end up with a profit of $140,000 because initially you only invested $10,000.
5. Look beyond the horizon – countries like India and China are growing at a rapid pace. The cost of a business overseas can be cheap and lucrative. If you are interested in investing in oversea opportunities you may want to consult with a financial advisor so he or she can help you find these type of opportunities.

The smartest financial guy in the world, Warren Buffett, has a saying that goes something like this: you should be fearful when others are greedy and be greedy when others are fearful. What Warren means is that if everyone is jumping on the bandwagon you should hesitate because in most cases when something looks too good to be true, it usually is. And when people aren’t jumping on the bandwagon you should take a closer look at it because the reward of doing so could be extremely high.

Right now everyone seems to be fearful, so I would like to share with you a few ways I am trying to be greedy (which will hopefully make me rich).

Stock Market

During the last few months the stock market took a big dip. Just about every stock is down which has caused people to become fearful about playing in the stock market. I don’t know if the stock market is at its lowest and truthfully I don’t really care. I just know that within the next 5 years it should be doing better than it is now and because of this I am being greedy when it comes to playing the stock market.

Compared to most people I have very little knowledge about the stock market. But one thing I do know is that companies that the government has bailed out are very unlikely to go bankrupt… especially ones like AIG who received 150 billion dollars. Due to this I have been buying stocks like AIG because I feel I will make a substantial return on my investment within the next 5 years.

Buying Companies

A lot of business owners are in debt right now, and as you know, cash is king during a recession. So when a business owner is looking to get rid of his profitable business because he is personally in debt, you can squeeze him to get a very favorable deal for yourself.

What I have been doing in the last few months is hitting up popular websites and asking them if they are interested in selling. In most cases website owners aren’t selling, but every once in a while you will find a website owner who is willing to sell at a great price because he is personally strapped for money due to some rare circumstances.

Angel Investing

Venture capitalists and angel investors aren’t investing much money right now. Good companies who are in need of money are offering more equity in their company than they usually do. Because of this you could potentially get better returns from investing during this recession than most people have seen for decades.

These are the main 3 ways I am currently being greedy. Anyone else want to share how they are being greedy?

Disclaimer: I am not an investment professional, this is just my opinion. Invest your money at your own risk.

A blog can do a lot for your career, but if your blog isn’t setup right, you will just be wasting your time. If you want to be a successful blogger, here are some things that you HAVE to do.

Take the time to write a good about page

When someone visits your blog one of the first things they do is go to your about page. If it isn’t compelling, they probably won’t be coming back to your blog. If you want to make your about page compelling you need a few things:

1. Reason – not only should your about page explain what your blog is about, but it should give the reader a reason to come back. A good way to do this is to list out all of the benefits of reading your blog.
2. Personal connection – most about pages lack information about the blogger. Have a detailed overview of your life on your about page as well as a picture of yourself. If you can create a personal connection with a blog visitor, you are likely to turn them into a regular reader.
3. Contact information – you don’t have to place your contact information on your about page, but make sure your about page links to your contact page. Don’t you hate it when you want to contact someone and you can’t figure out how to get a hold of them?

Make it easy for people to come back

Although you maybe familiar with RSS feeds and RSS readers, most people are not. In your blog sidebar you need to provide multiple subscription options. For example I provide an email option.

Providing subscription options isn’t enough. You also need to convince people to subscribe to your RSS or email feed. You can do this through text:

Even if you don’t visit Quick Sprout on a regular basis, you can stay tuned by having the latest Quick Sprout news delivered to you for free via RSS or Email.

Make your content look attractive and keep your blog design simple

You may want a blog design with cool graphics, bright colors, and tons of pictures…but do you really need it? A fancy design will just distract people from reading your content. Here are 3 things you should keep in mind when designing your blog:

1. Simplicity is the ultimate sophistication – try to create a plain white design with little to no graphics. This way your blog will load fast and people will focus on reading your content.
2. The bigger the better – not everyone is 20 years old. Make sure your text is big in size and black in color. The typography you choose should also be easy to read.
3. A picture says 1000 words – your blog design should be flexible, so that you can embed images within your blog posts. Pictures will make your blog posts easier to read.

Create a community

What makes a blog so great is that you can have a conversation on it. Remember you aren’t the only one who is going to be contributing to your blog, your readers are going to as well through comments.

Here is how you can create a community on your blog:

• Invite a conversation – end your blog posts with an open-ended question. I usually use the line, “anyone else have any suggestions”. Anything will really work.
• Use threaded comments – threaded comments will make it easier for others to reply to a comment (similar to a forum discussion). This will help create a conversation through comments.
• Reward your commentors – through a top commentors plugin, people can get a link back to their site if they comment enough. The way the plugin works is that the 5 or 10 most active commentors gets a link to their site within your blog sidebar. This is great because it encourages people to comment due to the traffic they can get from the link.
• Respond to every commentor – no one likes talking to himself or herself, so respond to every commentor. This will show that you care for your readers input and it will help you create a stronger community.

Content is king

The most important part of a blog is the content. If you don’t have good content, very few people are going to read your blog. Here are a few ways you can improve your content:

• Write resourceful content – news is great, but there are already tons of people who write on it. Instead of writing on the news, create content that helps people. Writing how-to guides is an example of creating resourceful content.
• Use attractive headlines – if the titles of your blog posts aren’t attractive, how do you expect people to read them? If you have trouble creating attractive headlines read this blog post.
• What is old to you is new to others – just because you know something it doesn’t mean others do. Even if another blogger already wrote on a specific topic, it doesn’t mean you can’t write about it. People don’t have time to read 100 blogs a day; the chances are they only read a few.

Lastly other than writing good content, you need to write it on a regular basis. This doesn’t mean you have to blog everyday, but you need a consistent blogging schedule. For example, if you want to blog once a week, then make sure you publish 52 blog posts by the end of the year.

Anyone else have any recommendations?

Donald Trump and his daughter, Ivanka, were driving one-day and on the corner of a street they spotted a bum. Donald pointed out to Ivanka, that the bum had more money than he did. She was startled, and she naturally asked him how that was possible. He then went on to explain how the bum had no debt, while he had a lot of it.

The average American household is $14,500 in debt. If you include things like a home loan, the debt amount per household drastically increases. But this shouldn’t stop you from becoming rich, just like it didn’t stop Donald Trump. Instead, it should make you adjust how you control your finances.

If you want to become rich the first thing you need to do is adjust the way you spend your money:

1. Pay off your debt – list out every penny you owe and the interest rate next to it. Chances are that you are paying more interest on things like your credit card than what you are earning from the bank. So instead of making the minimum payment on your credit cards each month, pay them off.
2. Spend your money wisely – just because you have money, doesn’t mean you should waste it. Be cautious with your spending and if you really want something, buy it when it is on sale.

After you start managing your finances wisely, you need to change your viewpoint about money. Every penny counts! When you see change on the floor, pick it up!!!!!!!! There is nothing wrong with this; even millionaires pick up change off of the ground. You’ll be amazed how fast all of those pennies add up.

Now that you have the right mindset, you need to start making make more money, with your money. Incase you didn’t know, more millionaires are born during recessions due to the opportunities the economy presents. If you want to be one, here is what you need to do:

1. Embrace the unknown – there are going to be tons of opportunities for you to get rich especially in this economy. Things like the stock market are very attractive, but before you jump in, make sure you learn about it. Be willing to put time into learning new things because if you don’t you will either miss the opportunities or you will lose all your money by investing in something you have no knowledge about.
2. Ride the coattails of the rich – people are desperate right now, so the rich are seeing some of the best investment deals ever. Although you may not know much about investing, the rich usually do, so try and ride their coattails. Now granted, this only works if you know a lot of rich people, so if you don’t know any millionaires, you better hurry up and get to know them.
3. Make a lot of bets – like everything else in life, if you keep on trying to become rich, sooner or later it will happen. By being more cautious with your spending you should have more money to play around with. Don’t be gun shy, invest when you see the right opportunity. And if you find a really good opportunity never go all in, it may actually be too good to be true.

Update: John Chow just wrote a blog post correcting many of my errors. He talks about things like good debt VS. bad debt. He makes some very valid points, you should check it out.

Because the US economy has been in a recession for a full year now, companies have been going out of business. For the ones that aren’t going out of business, they are likely to loose much of their anticipated revenue. So what does this mean for you?

Whether you believe it or not, the recession is hurting your income. You may claim your company is recession proof, but that is a bunch of bullshit. Doctors, lawyers, teachers, and even Internet gurus are all losing money (or are going to if they haven’t yet). For example with less people employed, the number of people who have health insurance decrease, which means less people are going to visit the doctor when they are sick.

In the Internet world many companies haven’t seen the recession hit them yet, but the reality is, it has already hit them. For example Jeremy Schoemaker wrote a blog post saying that the recession hasn’t hit his company yet. Even if we go into an economic depression, Jeremy will probably still make tons of money because he is a talented marketer. Although people like Jeremy are still making a lot of money, if we weren’t in an economic recession they would probably be making more money, which means the recession has hit them.

So if you think recession hasn’t hit you, think again. If your company isn’t losing money and your growth is flat, consider it a good thing. In this economy, flat growth is considered the new up.

What do you think?

If you haven’t already made millions of dollars but want to, there are only 4 ways you can do so:

1. Inheritance – this is the easiest way to make money, but also one that usually isn’t in your control. If your parents or someone in your family doesn’t have tons of money, you probably will not be inheriting it.
2. Stunning physical attributes – if you are good looking or athletic you can usually make a good living through modeling or sports. If you are not athletic there isn’t much you can do to change that, but as for the modeling part you can always get plastic surgery if you aren’t attractive.
3. Knowledge – if you have knowledge that others don’t have it could be worth a lot of money. The thing with becoming wealthy off of knowledge is that in most cases it can’t be something others can easily find out. People who become rich through knowledge are usually in the scientific field or have a high IQ.
4. Willingness – the last way you can become a millionaire is by doing things that others won’t do. For example, if you are willing to work 12 hour days instead of 8 or do things that are out of most people’s comfort zone, you have a shot at becoming rich. Becoming rich through willingness means that you have to learn to go that extra mile.

Hopefully you fall into one of these categories or else the chances of you becoming a millionaire are probably worse than the lottery. In most cases you will not fall into the first 3 categories, which only leaves the last one. If that is your only option you better be willing to do whatever it takes. If you aren’t you better learn to or don’t waste your time trying to become rich.

Update: Thanks to a few Quick Sprout readers, you now have a 5th way to become rich. It is through creativity.

Running in place AND moving. Holy shit. Is that possible?

Hopefully this teaches you that you should always ask other people for their opinion. You don’t have to listen to them, but there is no harm in asking. And even if you decide to continue with a dumb idea, it doesn’t mean you can’t get rich off of it.

Do you know of any other dumb business ideas?

Update: Oh shit! This guy may actually be successful. It seems like his company has many other products that are popular.

When you hear about “Las Vegas,” words like booze, girls, and gambling come into mind. What you probably don’t realize is that you can actually learn a lot from Las Vegas…especially the casinos. Here are the business tactics that I learned from my Vegas trip:

1. Time does not have to exist – When you walk into a casino you will notice that there are no windows or clocks. They do this so you cannot tell what time it is. This is a smart business move; it doesn’t occur to customers that they are spending too much of their time in your business. So if you have a storefront, be sure to not include any clocks. Or if you are in a sales meeting, try to hold it in a conference room with no clocks and windows.
2. Sex sells – Not only are casinos decorated to look beautiful, but the female co-workers inside them are usually attractive. Who doesn’t want to walk into a room filled with attractive people? So, if you use pictures of people on your website, make sure they are attractive. And if you have a storefront, try to hire decent looking employees.
3. Don’t be too organized – It is really easy to walk onto a casino floor, but it is even harder to walk out! Machines are always around, which is smart for the casino because it increases their odds of taking your money. So with your business you want to entice people when they check out. Make sure you are up-selling more products.
4. Make it easy to spend money, and harder to collect – Gambling is really easy; all you have to do is give the dealer or machine your cash. But if you want to cash out to get your money back you’ll have to find the cashier. In the Internet world it is already difficult to get refunds; but you still want to make sure your check out process or shopping cart is easy to use.
5. Never say no – You can’t take customer service for granted because it can make or break your business. Try to provide whatever the customer wants in reason. Be sure to make it easy, just like how casinos offer free drinks in the midst of gambling.
6. Encourage repeat business – If you gamble at a casino on a regular basis you end up with freebies such as a 3-night stay. Do promotions with your customers to encourage them to shop with you again.
7. Appeal to the five senses – Everyone has emotions, so why not appeal to them? With the design of your website, building, or even casino you can create a good energy that will make people want to be there. When designing your business keep in mind the basic design elements, such as color, because they can affect a person’s mood.

Do you have any Las Vegas business tips to share?

Why do you respect Joe the plumber and not Jose the lawnmower? Joe may dress more professionally and speak better English, but it doesn’t mean he is above Jose. People like Jose understand entrepreneurship and business, which is why he will surpass Joe the plumber when it comes to net worth.

1. Jose has a harder work ethic than Joe. Instead of working 40 hours weeks like Joe, Jose tries to work at least 70 hours so that his kids can have a better education.
2. Joe enjoys going out and having fun, which isn’t a bad thing, but Jose saves his money for his family and retirement.
3. After a hard days work Joe likes to watch CNN and see where the presidential debate is. Jose on the other hand is working so that one-day he has enough money to buy CNN.
4. When things go wrong in life Joe gets depressed and hides out in his house. Jose on the other hand is always grateful for what he has and keeps moving forward in life. Instead of whining like Joe, he is trying to solve his problems.
5. And the best part about Jose is that he may make less per hour than Joe, but at the end of the day he is making more because he pays no taxes.

Who would you rather be? Joe the plumber or Jose the lawnmower man?

Hustling is a word that usually carries a bad connotation. When most people think of the word, they think about dealing drugs, conning people, or doing something unethical. But hustling isn’t always a bad thing; many entrepreneurs have succeeded because they are hustlers.

Kamran Pourzanjani, the founder of PriceGrabber.com, which sold for $485 million, used to sell $150 knife sets door to door. This may seem like an easy thing to do, but twenty years ago $150 was a lot of money. Being an immigrant to the United States did not slow him down one bit. He did whatever it took to survive and his aggressive nature helped him to succeed.

Jermaine Griggs, who made millions teaching people how to play the piano online, grew up in the ghetto. Because his family struggled for money, he had a hunger to make money. At the age of twelve he signed up to be an Avon sales representative, while other men probably would not have done this due to the fear of being made fun of. Jermaine’s attitude towards making money, and his courage to ignore what others thought of him, helped him create a three million dollar company…all while he was in college.

Stephan Spencer, the founder of Gravity Stream, started his company at the age of twenty-three, even though he had to support a family. Although he didn’t have much money to start his company, he didn’t let this deter his success. He used to volunteer at marketing conferences so that he could meet large companies that would, hopefully, become clients of his. Flash forward to today, and now his company is making millions of dollars a year by servicing companies like the Home Shopping Network, Northern Tool, Cheap Tickets and Skechers.

Hopefully these three individuals will change your opinion on hustling. There is nothing wrong with doing whatever it takes to succeed, as long as what you are doing is ethical and legal. Don’t let anything stand in your way and be proud of what you had to go through. For example, I never regret the fact that I spent three months selling $1600 vacuums door to door, and made no sales. That experience in life helped me get where I am today.

Now go out there and start hustling!

Your dream sale probably involves a Fortune 500 company and millions of dollars. The problem with sales is that it is very difficult to sell to a Fortune 500 company due to their corporate structure and if you happen to seal the deal, don’t expect to make much money at first.

Although these companies have large budgets, they usually won’t spend much of it with you the first time around. If you want to get around this, you have two options:

1. Get to know someone high up in the company that had a lot of pull.
2. Have a product or service that can either save a company money or make them more money.

If you can’t get around that, it doesn’t mean you shouldn’t go after the sale. Actually you should do whatever you can to close the deal, even if this means you are going to make no money on the deal or potentially lose money. The main reason you want big named clients is so that you can showcase them to other potential clients. This will help build the credibility of your company and help you make larger sales. Plus what you’ll sooner or later notice is that the majority of your big sales are from companies that most people have never heard of.

Just because we are in an economic recession, it doesn’t mean you can’t be doing well. A few weeks ago I invested money in a venture fund called the Founders Co-op. Currently we are looking to invest up to $250,000 in multiple companies who are based in Seattle or looking to move up there (there is no state tax in Washington).

Here is what the Founders Co-op can offer you:

1. Money – with capital you’ll be able to grow your company.
2. Expertise – unlike most venture funds, the Founders Co-op isn’t made up of finance people, instead we are all entrepreneurs. Because of this you will get advice from people like Ben Elowitz who co-founded Blue Nile and took it public. Or Andy Sack who founded three Internet startups and sold them (the first company was bought by Acxiom, the second was bought by the New York Times, and the third was bought by Microsoft).
3. Networking – meeting random people on a regular basis is easy, but meeting people that can help your business grow is hard. Through the Founders Co-op you will get to meet the right type of people.

I know this may not sound attractive to you, but this is truly a once in a lifetime opportunity. The people in the Founders Co-op changed my life. They took me under their wing and helped grow my companies. Not only did they give me business advice, more importantly they are good friends who are always looking out for my best interest.

If you are interested in having what I have, I highly recommend checking out the Founders Co-op and consider applying for venture financing.

Update 1: If you need any help or have any questions, feel free to leave a comment.

Update 2: If your company needs more than $250,000 you can still apply for funding from the Founders Co-op. In many cases the Founders Co-op will still fund you, but through our network we will bring on other investors to participate.

Update 3: Whether you have a new business idea or an existing business, you can apply. This opportunity is for anyone.

Update 4: For those of you who are wondering about my involvement with the Founders Co-op, I am pretty much a Limited Partner. All this means is that I invested money in the Founders Co-op. I am not involved in the daily operations, but I have some say on what companies get funded. I also will do everything in my power to make sure that the companies we fund are successful.