Who should read this: Freelancers, entrepreneurs or anyone who wants to start a lean business with little overhead.
Two trends have allowed for the emergence of the 1 person, 1 million dollar business. 1) Outsourcing and 2) Automation. Automation in particular has catapulted us into a totally new work paradigm, and today there are millions of people around the world who are running 6, 7 and 8 figure businesses without any full time staff. Their businesses range from drop-shipping e-commerce businesses, to ebook/media businesses/content, real estate, and consulting firms.
Many companies were built on systems that require people to behave in uniform, predictable ways so the owners could efficiently scale their operations and maximize their profits. Their punch-clock model has typically required workers to compartmentalize their home life and work life. If you want to do things in a way that suits you better, you won’t fit in.
There’s a stereotype that entrepreneurs and small businesses need to scale. However, not everybody wants to be a Zukerberg or a Musk. Most people don’t want, nor do they need that sort of stress and aggressive growth strategy. You can still mak e an impact, focus on quality, and have time to spend with friends and family. That’s the dream – find a niche that you love, outsource as much as you can, and systematize sales/marketing.
As you consider the options in front of you, it pays to tap into expertise you’ve already built.
The book was a kind of updated, re-hashed version of the 4 hour work week, featuring interviews and case studies of entrepreneurs that have been there done that. What I thought was most valuable was the long list of specific tools, websites & book recommendations at the end that allow you to essentially startup from scratch. The ones that I found most relevant were…
- The $100 Startup by Chris Guillebeau
- The Simple Living Guide by Janet Luhrs (Broadway Books, 1997)
- Makers’ Row (makersrow.com)
- LegalZoom (legalzoom.com): If you need help with business formation, corporate filings, protecting your intellectual property, or real estate listing, this site offers services that may be useful to you.
- ClickBank (clickbank.com): This giant content marketplace can be an excellent source of ideas on the type of information-based products you can sell online.
- iPROMOTEu (ipromoteu.com): This service provides order fulfillment and back-office support for sellers of swag
- Streak for Gmail (streak.com). This free extension for Google Chrome offers many features that will allow you to manage your sales and customer relationships within Gmail.
- FreshBooks (freshbooks.com): This entry-level accounting software is aimed at creative types who aren’t comfortable with finances but need to keep good records. (thats me)
- Gusto (gusto.com): Formerly known as Zen Payroll, this site offers services to help small employers set up payroll, pay contractors, obtain worker’s compensation insurance, and provide health benefits
TIPS ON LAUNCHING YOUR OWN BUSINESS
Cash flow vs debt
You’re better off growing your business more slowly and funding growth out of cash flow. Despite the popular image of entrepreneurs being high rollers, many million-dollar entrepreneurs are conservative about borrowing, doing it only when absolutely imperative. “I’m very anti debt,” says Matt Friel, one of the million-dollar ecommerce entrepreneurs you’ll meet later. “I tend to pay everything up front.
THE SIDE HUSTLE
Many entrepreneurs start businesses while working full-time for someone else and use their paychecks or a spouse’s as funding. “I think it’s dangerous to come up with an idea and walk away from a well-paying job if there is no obvious indication this will do well,” says Kelly Lester.
it sometimes makes sense to transition from paying taxes as an LLC to doing so as an S Corporation. Although there are added record keeping burdens to maintaining S Corp status, many owners experience significant tax savings. It is best to get advice on this sooner rather than later, especially if your business is growing quickly. “It was the best move I ever made,” says Jonathan Johnson, who transitioned to an S Corp three years ago. Although the year he made the changes was challenging because of the paperwork and associated costs, he says, “It really made a difference.”
One of the great things about America is that it was founded by capitalists. Our tax code has always had a bias in favor of entrepreneurs. The tax code offers a large array of deductions and credits for people building businesses. I’ve discovered that many small business owners are not taking advantage of all of the deductions available to them.
Questions to ask yourself:
The ideal million-dollar, one-person business will allow you to achieve both your revenue and profit targets and the lifestyle goals that matter most to you. Here are some questions to ponder. As you write down or think through your responses, you’ll gain clarity on what matters most to you when starting a business. What do I like about my current way of making a living or my economic situation? Am I willing to leave behind what I like most about my current way of making a living or economic situation to start a business? Is what I like most about my current way of making a living or economic situation likely to be available to me in the next three to five years? What about in the next ten years? What would I like to change about my current income or economic situation? Would I be able to change the things I dislike about my current income or economic situation by running my own business? Would the business I want to start allow me to spend more of my time doing things I enjoy?
ELIMINATE, AUTOMATE, DELEGATE, PROCRASTINATE To keep his mind and schedule clear, Nadler uses an approach he calls Eliminate, Automate, Delegate, Procrastinate. He hunts continually for new ways to avoid doing things that don’t matter, to automate repetitive and labor-intensive processes, and to outsource work to contractors. “There are so many distractions that pull us away,” he says. That means being honest with himself about how he is spending his time. “I have a funnel where I do an analysis of what my workflow looks like,” says Nadler. Here are the questions he asks himself: • What can I eliminate? • What can I outsource? • What can I put on the back burner? • What can I say “no” to?