I Bootstrapped 27k Over 15 Months, Here’s the Main Lesson
Starting a business is the best.
You learn so much about everything. Life. Puzzle Solving. People. Human interaction. Motives. Game Theory. Projecting. Growth. Sadness. Rejection. Euphoria. Winning. Everything, lol.
But, it’s hard. Damn it's hard! And the learning curve is STEEP! Even when the dollars and stakes are relatively low, there's a lot going on and even more to try and manage.
This post is meant to help entrepreneurs save time. I’m going in depth about the main lesson learned while building my eCommerce brand, redrO Hanger Company, the past 15 months and spending about 27k of my own money. The good news is, when operating in this space (being an entrepreneur), there really isn't any time or money 'wasted', because you're in constant learning mode. The bad news is, looking back, you realize you agonized for days, weeks, even months over things that were irrelevant and spent a lot of $$$ on things you didn’t need to.
Also, just for perspective, the timeline here is 15 months because I’m still working a full time day job, so all of this is going on during nights and weekends. I would highly recommend you also take this approach before quitting your job until your side project is throwing off more than what you currently make. (pro tip - it's going to take you a lot longer than you anticipate) Don’t strangle your golden goose before you truly have a cash cow that is more valuable.
Ok, so getting back to the lesson... Building a business, just as anything else in life, is all about the 80/20 rule. 80% of results are going to come from 20% of time spent. Nice cliché, Chris, wtf does that actually mean?
It means, focus your VALUABLE time, effort, and energy on a few things that are really going to MOVE THE NEEDLE for your business. It's that simple.
^^ This is why most businesses fail, especially companies that are brand new. They're unable to focus (or even recognize) what is getting them TRACTION or making them MONEY. This is avoidable. Hopefully, this short essay helps.
Here is the lesson: There are the only 3 aspects of your business to focus on when you’re starting out:
Product / Service
Funnel
Traction /Audience
This is where 80% of your time and money should be spent. Everything else is noise.
Let’s get deeper, starting with the list of things that are absolutely not essential:
** Keep in mind, when you're starting your business, these are all going to be VERY IMPORTANT TO YOU. Which is good! It's yours! You're proud - and you should be. But guess what? Your clientele care far, far less concerned about any of these things, and trust me, the following points aren’t worth anything more than minimal time, effort, and energy, and $$$ on the front end!
Name/Logo (Within reason. Avoid vulgarity, etc. Just don’t agonize for months, it doesn't really matter)
Branding
Your catch-phrases
Your website (assuming there is basic functionality/it doesn't look like total shit)
You can build these simply w/ Squarespace (this website) or Shopify (redrO’s website)
Keep this clean and simple to start, honestly build it yourself.
Design
Fonts
Legal work
Form an LLC w/ your secretary of state, or legal zoom, then be done with this
Don't worry about patents, NDA's, etc (for the most part)
Everyone else is way too busy to copy your idea and don't understand the work/time required to bring an idea to life (the FB example always referenced is an extreme outlier)
Business Credit
Perfect creative / pictures / videos, etc
You can create basic ads on your iPhone that are high enough quality to do initial tests
You're not going to go viral like the dollar shave club video, don't spend thousands of dollars on video production (that is a 1 in a million shot, lol, don't put your eggs in that basket)
Frankly the more relatable creative is actually performing a lot better on many paid campaigns than the theatre style ads
Worrying about getting your books perfected
Have mint? Or something along those lines? Perfect.
Create a separate expense label for your business and track stuff that way
Don’t worry/agonize about this when you're first starting, wait till you get traction/dollars are actually relevant or substantial. Then pay to outsource this to a xero or something like that.
In the ecommerce space - don't put your stuff on Amazon - do this yourself
You are totally reliant on them - be reliant on yourself (your own website, fulfillment)
Amazon giveth, but also taketh away.
Easy revenue short term, but long term, not the move IMO
Raising money / getting too involved in the VC / capital raising scene
Prove your business is a thing first
You have a long way to go before you ask people for their hard earned cash
If it's your first rodeo, imo, you don’t have any right to raise money before you’ve operated / started a venture of your own previously, cause you still have no idea what you’re doing
Pitch Deck
Find something that works/can scale before you even worry about this
I agonized over this for weeks/months and showed 3 people lol
DROP YOUR PERFECTIONIST HABITS
Most people that are entrepreneurial in nature are some form of type A and have a lot of perfectionist habits/pride
That's awesome, but you're not alone, you're also not special in this way, we're all here to play ball, and we’re all gamers. We wouldn’t be in this space otherwise, get over yourself (in the most polite way possible xoxoxo :)
SHIP PRODUCT - What did you ship this week?
TEST DON'T GUESS
As soon as you get that through your head, you'll advance, 10x quicker
Example:
A few short months ago, our state of the art fulfillment center (my buddy Sam’s basement) was humming right along, (meaning my Bose noise cancelling headphones were on, and I was organizing boxes/products by myself and humming deep house tunes far too loudly) when Ryan rifled down the stairs. My friend Ryan is the founder of a SaaS company for medical devices, and is abundantly familiar with founder mindsets and the startup scene. He has been there before, always knows the right thing to say, and when to say it.
Right before bringing redrO’s website live, I was procrastinating. There were a whole host of extremely important reasons to delay the perfect product launch! The packaging wasn’t just right, and we didn’t yet have my black branded stickers for the front of the boxes. We didn’t have the inserts with the redrO tagline for the inside of the boxes either. What about the tape and better yet, the correct device to use to apply the tape to the boxes!
Ryan goes, “Chris, these hangers are sick, why aren’t you selling a ton of these!?”
"We're not ready to ship yet, it isn’t perfect! I’ve got all this important stuff to get dialed in, like the packaging stickers, inserts, and tape and whatnot."
He laughed and said, “Listen to yourself! That's what YOU think - you sound ridiculous! It’s never going to be perfect. You have an awesome product that you’ve been working on for months at this point. You’re never going to be ‘ready,’ SHIP it now!!!”
Well, I pushed the site live that night, got my ads running, and got a sale the following afternoon.
Orders have been coming in since, and the process has improved dramatically since then. (meaning we actually have a warehouse in south Denver at this point :)
But Ryan was right. I was more than ready to ship - just needed a little push. This is where you likely are as well. Like Paul Graham says, Release Early.
The best part, people loved em! 0 returns till order 47 (but who’s counting) AND and we got fantastic feedback! Issue with our first return? That the hangers were ‘too big’.
I guess not every guy wants to be well hung… (hehe see what we did there?)
OK, so now that we’ve talked about a ton of scenarios that you THINK are important when just starting out, but really aren't, let’s get to the meat and potatoes of the essay:
Here are the 3 things that ARE ABSOLUTELY VITAL when starting your business:
1 - A Quality Product (Good or Service that provides immediate value)
First and foremost, you need to be solving a problem that people have. For me, it started as cleaning up/organizing messy closets/getting rid of the dreaded shoulder nipples (SHNIPS) on sweaters and my clothing in general.
This can be any problem known to mankind. (I’m making money selling clothing hangers for god’s sake. It can be any problem at all)
Sam Parr is always calling out these businesses on twitter and in the private the Trends group.
You need to provide a quality solution to that problem.
IT DOES NOT HAVE TO BE PERFECT, but it has to provide VALUE immediately.
2 -A High Quality CUSTOMER ACQUISITION FUNNEL that CONVERTS:
This is a fancy entrepreneurial term for having a website or some sort of platform that allows people to pay you.
Your ‘funnel’ gives you the ability to tell a great story, then follow it up with a strong call to action, to buy/use your good or service/offering.
You have to get people to your website, and pay for a product, or pick up the phone and call you, or download your app, pay for your movie, whatever it may be.
Vital part here - Explain HOW YOUR PRODUCT OR SERVICE WILL HELP THEM. Think benefits, NOT features.
Most people/brands focus too much on the features of their product, their professional background and how qualified they are.
These are important, yes, as it helps you build expertise, etc, but that's not going to get people to convert...
Thanks @mkobach
So, in your funnel -> GIVE SPECIFICS ABOUT HOW YOUR PRODUCT OR SERVICE WILL CHANGE THEIR LIFE!
with redrO, we have the sales landing page and WHY? landing pages.
This clearly shows before and after pictures of messy closets and then clean closets
It shows a sweater hanging on a skinny hanger, then one hanging on a redro hanger
SOLVING CONSUMER PROBLEMS
Essentially every guy I know has run into this problem. EVERY ONE!
If you’re getting a significant amount of traffic to your website (see point 3) but no conversions, you either have a 1 - good/service problem (too expensive, your service isn’t actually valuable, etc) or 2 - you have not shown enough VALUE through your acquisition funnel.
It’s that simple.
3 - TRACTION - Attention Grabbing Promotional Material (Ads that work)
You need to sell your good or service.
TRACTION, by Gabriel Weinberg, is an excellent book that talks about all of the different ways you can generate sales for your business, and I also wrote a long post about this a couple months ago, The 2020 Ultimate Growth Guide - 17 best Ways to Increase Sales.
Again, when you’re just starting out, focus on the 2 largest platforms, Google and Facebook.
They both have massive audiences that are capable of targeting billions of people.
As far as actual thought process goes for curating your ads, keep in mind
Facebook is about DEMAND CREATION
people don't go on on FB/IG cause they want to buy stuff... But FB and IG know what you like, so they're really good at serving you ads that might be interesting to you. Tailor your creative/messaging to that thought process
Google is about DEMAND FULFILLMENT
people are usually searching on google because they want the answer to a specific question. So, when working with google, keep in mind you're way further down the funnel and need to be very descriptive, etc.
You’re legit providing a solution in real time w/ Google.
Test , don't guess
get a bunch of ads/campaigns up and running and monitor them religiously
Double down on the stuff that is working, remove the stuff that is not working
THAT’S IT
Ironically, this goes directly, hand in hand with a favorite tweet from Naval:
1 - Quality Good / Service (Build)
2 - Acquisition Funnel (Build / Sell)
3 - Audience / Traffic To Funnel (Sell)
Example 2:
I was sprinting towards my desk at home to get my laptop set up. It was August of 2019, and I had just published my first blog post from a nearby coffee shop before slamming my screen shut to head back home.
It was such a euphoric feeling! Hours of writing over months of time had finally come to a close. Pressing publish on the first piece publicly was an accomplishment in itself. Having the balls to publish publicly is tough the first few times you do it. You’re exposed, people are going to judge you, there’s likely going to be grammatical errors, you’re finding your voice and trying to not sound like a complete moron, everything.
But this post was an absolute winner. Everyone and their mother was going to be interested in the perspective I was going to share about Wins and Losses. It was going to help people get into the right mindset for the professional world, make everyone on planet earth a better salesperson, looking at L’s as lessons, not losses, and not taking them personally. I was essentially going to be dubbed a modern day Gandhi. There were quotes from the Godfather in there and everything - this was going to change peoples lives.
It had been about 2 hours from pressing publish, and I had purposefully gone 0 dark 30 like my guy Lebron in the playoffs, including having my iphone on airplane mode, so the suspense was now at all time highs...
How many people had read the article? How many comments? How many new emails and texts and twitter followers were going to accompany this life changing event?
I finally got back home and got the computer set up. I connected to the wifi. Turned off airplane mode on the phone, and waited for the notifications to roll in.
Guess what happened next?! Absolutely nothing, hahahahaha!!!
No one had even seen it. I checked the Squarespace analytics page and there had been 1 viewer with 2 sessions. That person was obviously me. Tight.
It was at that moment I thought to myself, Chris, ‘No one gives a shit about you, but you’.
And suddenly it was obvious. I had no audience, I hadn’t done anything to promote the post. I hadn’t pushed it through platforms like FB or linkedin where there are people I’m connected to who are genuinely interested in what I have to say. I hadn’t paid for any traffic to go to my blog. Why would anyone have seen this thing?
I had selfishly thought that because I built something, people would come.
That’s not the case.
First you gotta provide value. That was evident with the blog post. But I hadn’t pushed any eyeballs to view the page, which is insane. Of course no one noticed it.
It was at this moment I also realized that equal focus needs to be put on the ‘selling’ of your good or service than does the building of it. Without an acquisition funnel and traffic for your rock star product or service, you have a beautiful mansion built with no roads leading there, and no doors to let people inside.
Remember this.
Hopefully that short story helps illustrate that process to you as well, and saves you some valuable time/heartache as you’re building your business, whatever it may be.
In closing, here are the 3 Main Lessons Learned from 27k of my own dollars spent bootstrapping a business over the past 15 Months.
1 - Build a Quality Good or Service
If this doesn’t exist, you don't have a business.
Ship Early.
2 - Get your Customer Acquisition Funnel DIALED IN
Make sure you have removed all paths of resistance for your consumer to purchase when ready.
How is your good or service HELPING YOUR CONSUMER? That's all that they care about. Be sure this story is adequately articulated in the funnel.
Strong Call to Action - Need to Buy.
3 - Figure out the best way to drive traffic to your website, double down on what’s working, and point it towards your customer acquisition funnel.
Remember, no one gives a shit about you but you.
Test don’t guess.
Leverage paid / organic platforms to push traffic.
Everything else is noise.
I'll be publishing a lot more on this topic, haha, cause there is a lot to it... But seriously, if you're just starting out, FOCUS ON THE 3 ABOVE TASKS and you'll save yourself a lot of time and effort and money. You’ll simultaneously figure out exactly what you should be focusing on and where your business should grow.
Lastly, always remember,
It Will Never End!
As always, follow @itschriskeith on Twitter for more frequent updates or email itschriskeith at gmail dot com with any thoughts/concerns!