Elaine Pofeldt

Elaine Pofeldt: Strategies for Creating a High-Revenue Microbusiness (#303)

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Our guest today: Elaine Pofeldt

Elaine Pofeldt is an independent journalist who specializes in small business and entrepreneurship. She is the author of Tiny Business, Big Money for W.W. Norton & Co. (February 15, 2022), a look at how seven-figure businesses with small teams are reinventing the small business landscape, and The Million-Dollar, One-Person Business (Random House), a guide to how solopreneurs are breaking $1 million in revenue in businesses with no employees except the owners. Her work has appeared in FORTUNE, Money, CNBC, Inc., Forbes, Crain’s New York Business, and many other business publications. She has contributed to the Economist Intelligence Unit. She is also a ghostwriter/collaborative editor.

Get your copy of Tiny Business, Big Money: https://amzn.to/3tjTwRt

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Transcript

Elaine Pofeldt: Strategies for Creating a High-Revenue Microbusiness – powered by Happy Scribe

Hi, everyone.

This is Fei from FeisWorld Media, and I’m going live with I know, such excitement today because one of my favorite authors, Elaine Pofeldt, is here with me with her second book. Oh, my God, where’s the book? Look at this. You can do it. Oh, my God. Hold it up, hold it up. Oh, I love it.

Here it is. Tiny business, big money. My show is hell.

Yeah. Amazing. I mean, this book has so much of what I feel like this is the book I’ve been waiting for because I love Elaine’s first book, which is a one person million dollar business. And this book kind of really, since the Pandemic is here to talk about the second cohort, which is exactly tiny business, big money, people running small teams. And I feel like even though I don’t qualify to be absolutely not featured in the book, but I also feel like there’s so much that I can relate to running my very small business. So welcome, Alan. I’m so thrilled you’re here.

Thank you so much. But I was looking forward to this all week because I remember the last time I was on, we had so much fun. You’re such a great host.

I’m so glad you can be back in the moment. I got your email, I was thinking, this is going to be amazing. So, Elaine, if you don’t mind, I’m going to actually just introduce you to maybe some of my audience who’s not as familiar with your work for a brief moment. So Elaine Pofell is an independent journalist who specializes in small business and entrepreneurship. You’re in the right place, by the way, if you have been thinking about maybe getting out of your nine to five and really getting started and consider what you need to do to start your own business. She is the author of Tiny Business Big Money and which was published on February 15, 2022, just about a month ago. And I’ve included a link in the description wherever you’re watching this to purchase a copy on Amazon. And this book is a look at how seven figure businesses with small teams are reinventing the small business landscape. And the million dollar one person business from Random House, a guide to House Solopreneurs, are breaking $1 million in revenue in businesses with no employees except the owner. Her work has appeared on Fortune, Money, CNBC Inc.

Forbes, Cranes, New York Business, and so many other business publications. She has contributed to the Economist Intelligence Unit. She’s also a ghost writer, collaborative editor, and yeah, with that said, Elaine, please tell us why or what makes you want to write this book in addition to the first one you released just maybe a couple of years ago that everybody’s still in love with.

Well, what was really interesting said was I updated the Million Dollar One Person Business about a year before this book came out, and a few of the people said to me, Elaine, I’m really sorry that I hired an employee. And I said, don’t be sorry. That’s awesome. I’m so excited for you. And what I found was that they had a need for information about how to keep all the freedoms of having the million dollar one person business when they started adding a team. And there were a lot of challenges in the areas of communication, right? If you’re used to just working for yourself and you have the occasional random contractor, the burden on you as a leader isn’t communication. But when you have a team of virtual assistants or people around the world working with you, you really need to be a better communicator, or you can become a bottleneck. And you also need to think about, okay, what does good look like in this tiny business? It’s not General Motors. It’s your three person company. What can you deliver to a client and what can’t do and how do you handle client contacts and things like that.

So you really have to have more documentation and more teaching of the team. And so I thought, there’s got to be a way that the people who are just one or two steps beyond this stage are solving this that works for this size business. Not the corporate ways that maybe we all learned in our previous careers, but realistic ways that they can afford to do. And so that’s kind of where it came out of.

And what was superhuman about reading this book. Compared to the first time around. Elaine. Is I had to read the introduction. And something that really hit me was for you also. As a small business owner. To describe what life was like and still is like for you. For some portions of it. To like to really live your life as a small business owner during the Pandemic. And you describe your daily ritual or routine to walk in your neighborhood. No matter the situation that is outside. And then you mentioned in this segment where you said, whenever you see a small business that has to close down, it will put you to tears. And that’s something that was so relatable to me as well. So what was it like?

Well, during the Pandemic, I’m in New Jersey, and we were under pretty strict lockdown, and so I remember we were allowed to go outside and take walks, so that was the only thing I could really do. And I would walk through the downtown of one of the neighboring towns, westfield, New Jersey, and you would see these longtime family businesses. First they’d be unlimited openings and limited schedules, and then gradually they didn’t have the revenue coming in. And you’d see the sign that the business was for rent, and it was getting very pock marked with those signs. And I had gone into so many of them so many times, and you think, oh, there’s a family that owns this, or I know that individual that owns it. And as a business owner, you know how much heart and soul they put into it. So you do feel a lot of empathy, I think, when you see that, like, what happened, there’s a real story behind why the business closed. And in some cases, maybe the person was ready for retirement and this was like the little nurse that maybe they needed to make that next step.

But I think for a lot of them that was not true. They went through a very hard time and they’re still recovering. But there also has been creative destruction. And so in some of those spaces, new spaces have opened up. Like I saw they opened up a little. I think it’s called selfie station. It’s like a birthday party place where people come in and take in one of these formerly vacant storefronts. Kids come in and take pictures of themselves on these stages. And I thought, you know, this always happens in capitalism is one thing closes and another opens up. So I think now what’s happening. We did see a huge boom in the number of new businesses created. Score said that 5 million businesses were registered last year and it was a record number. So despite all the destruction, there was sort of a happy other side. And that a lot of people, because they were home at the time to finally work on that business idea that was percolating. And if they were commuting, they would have never been able to start it. And now they discovered something really interesting, which is they’re good at it and they never had an opportunity to find that out.

It’s kind of like if someone puts you on a tennis court and you never play tennis and it turns out you’re just naturally good at it. That’s a nice discovery to have for the rest of your life.

For sure. Absolutely. And for people who are watching, by the way, feel free to send us questions. I think it’s such a rare opportunity to be able to connect with a longtime journalist. Elaine has done so much research to bring this work forward in the country. I’m very like kinesthetic, like, I don’t know, I’m very feeling driven person. I feel like we are this really good combination to bring this idea forward. I also want to give people a heads up that today we’re going to really talk something. It’s not just raw, it’s not just oh, you know, this is for everyone we know that comes with certain struggles and to give you to tease out the content a little bit. I have put together here how to just like Elaine has structured how to break out of the employee mindset quick ways to generate your business ideas. Where to find the cash. Find the money to bring your ideas to life and what system to put in place so that you can maximize your learning and the resource that you brought forward and so much more things that we’re talking about today is going to be really.

Really practical. Yeah. With that said, Elaine, I want to kind of jump in that a lot of people who are thinking about entrepreneurship or perhaps still really struggling with the employee mindset. And could you maybe explain what that is and what you have stumbled upon and learned along the way?

Sure. Well, one thing, Faye, that I thought was really interesting was there’s a mental shift that takes place where people have to be ready and willing to define their own future. One of the entrepreneurs in the book, Kathy Guggenhe, runs a virtual assistant business that’s gotten to be seven figure business with a small team, and she worked in a telecom company for much of her career. She worked in marketing, and for a long time, her career was controlled by her boss, and she wanted to get a promotion in marketing. And went to him and asked what she would need to do, and he said, well, you need an MBA. So she went out and got it and then came back to him a few years later and said, you know, I finally got my MBA. I’m ready to move up. And he said, well, you’re not going to get promoted because the real reason I didn’t promote you is you laugh and smile too much. And the way she told it was kind of like scene was coming out of her ears, and a lot of things clicked for her there. She had kind of by the nature of this was, I think, in the so most people really did work in big companies and traditional jobs.

It wasn’t as entrepreneurial at that time for the average person because we didn’t have the Internet so widely available and all the tools that we have now. But she decided to take ownership of her own career destiny, even though that came with some risks. She went out and she originally, she quit and she started a business that was involved with direct sales, but it was selling candles, and she turned out to be not that interested in it. So then she started blogging for this one local realtor, and he said, you know, a lot of other people could use these services, too, in real estate. And then she kind of started getting more real estate agents hiring her. And then she had so much work that she needed to bring on some people under her, and she called them virtual assistants. And then what she realized was a lot of them didn’t know how to manage the business side of things. So there was all the skills she had picked up in managing her own business. She could teach them, and that really became the business where she was training them how to be. Not like a $10 an hour VA, but one who charges $150 an hour doing really high level, highly skilled work like managing the technology of an ecommerce store, things like that.

So she really took ownership of her career and kind of like, let go of blaming her boss or, you know, blaming societal expectations for why she has to say in a terrible job that she hates. They look at risk through a different lens. Another entrepreneur in the book, Anthony Coombs, he runs a business called Splendy’s, and it’s a box company. I don’t know. Are you familiar with Birch box fee? It’s like a gift box that people order for themselves or for friends, and it’s filled with little surprises every month. And in his case, it’s plussize women’s, sexy lingerie. And he discovered that a woman he knew told him there was a gap in the marketplace. And he was a serial entrepreneur. He had sold cars, online, mosaic tiles. He’d done, like, a whole bunch of different products. So he was somewhat agnostic about the product, and he put it out there. It’s about an $18 million business now with, I think, ten contractors, no employees, but it’s a tiny team. And what drove him was when he was a kid, his mother worked for the state of Florida, and the governor changed, and she lost her supposedly secure state job, and it plunged the family into a very difficult situation financially.

She was a single parent, and he ended up helping his grandparents in their flea market table. And he just said he never wanted to be dependent on anyone else for his job in the future. And he said to me, what is a greater risk to put my future in the hands of a company owned by someone else or myself? I’d say working for someone else is a much greater risk. So he looks at risk through a different lens, and they’re willing to learn as they go along. One woman, Elizabeth Davis, runs Shadowy, which is a hair care brand for women who want to grow long hair and not have the breakage. And she is an engineer by trade, and she started mixing up the potions in her kitchen and testing them on her friends and family. And she had a lot of mishaps, but she ultimately came up with a product that became a million dollar business. This is also really important, I think, for everybody, because we’re talking about practical. I don’t really recommend that most people just quit their job and dive in. I know there’s like a Silicon Valley mythology of, like, you have to be all in or you’re not entrepreneur, but the reality is your electric bill does not go away and your kids need to eat, and you might have student loans, and so who’s going to pay all that stuff?

Starting it as a side hustle can be very helpful. While you create a financial base, you have to be willing to make the financial changes. Like, maybe you live below your means for a while, or if you’re in a relationship maybe you live on one person’s income and put your income into the business, but it’s that willingness to be like, okay, I’m not a corporate employee. I cannot do my two week vacation in Aruba because my paycheck isn’t going to be coming. And I’m also pouring money into this business and owning that and being like, but you know what? I’m building something that I really would love to work in. I want to wake up every day and do work. I like, not have to work for that toxic boss. You said I need an MBA when I really didn’t. And it’s a mindset. And then the most important thing is to be willing to keep showing up. I look at it a lot. I do yoga every morning. I go to a hot yoga school, and it’s a practice. You go every day. I’ve literally been going every day for years now at this point.

And sometimes I don’t know why I can’t learn something. I was trying to do this posture called the Crow, where you balance on your elbows, kind of with your knees on your elbows. And I used to fall on my face, and one day I came, and somehow I could do the crow. Now I could do, like, the crow into a headstand, into the chatteringa. And I’m like, five years ago, I never thought I could even do this. And I don’t know why on that day it clicked, but I said my body understood how to do it. And I think entrepreneurship is similar to that, where you keep showing up and you’re like, working on your digital marketing and you’re trying a million things and nobody’s really looking at it. And then all of a sudden, something just clicks. All this stuff you’ve been doing, but if you don’t show up consistently, the click will not happen. And you have to show up. Like you were talking about COVID Faye through those bad times, too, because that’s often when you have the best discoveries. There one entrepreneur. Her name is Abby Walker. She runs Vivian Liu.

And what it makes is inserts for high heels to make them comfortable. And we know that’s kind of an oxymoron, but she actually had a blog. She’s a mother. I don’t even know how she did this. She has this very creative blog about high heels, and she would actually wear high heels to work every day, which to me is like a huge effort. She found these guys who were MIT scientists who had invented an insert that made the shoes comfortable, and they weren’t really marketing it that much. And they’re like, oh, we’re just a bunch of MIT scientists. We don’t know how to market this to women. And so she teamed up with them and licensed the idea and turned it into the brand Vivian Liu. And they have this dormant email list that she brought back to life, which was showing up every day and working on this boring task of the email list, but she built it up, and then it wasn’t taking off as much as she wanted. And she went to this little an event about pricing, and the woman who ran it said, I think you should grow your business by doubling your pricing.

And she’s like, Can I really do that? Just double my pricing overnight? And she did it. And then the things took off. It was somehow being perceived as a higher end product made the business grow that was showing up and trying it. And then during the pandemic, no one was wearing high heels because we were all at home barefoot or wearing slippers or whatever we wore in the house. So she pivoted into doing inserts for athletes shoes to make them, and she lost some revenue along the way. And that is part of it. Nobody’s revenue generally keeps going up and up and up. Unless you scale to a gigantic size, you have ups and downs. But she learned so much. And I think these stories will tell you that I interviewed, I think, almost 60 people for the book, and that’s what I learned. They have the same problem as we all do with our businesses, but they don’t give up. And I don’t mean to say they’re RA, like, charging into battle all the time. They get depressed and feel crappy about their business, too, but they still open up the laptop and get on there, and they work on whatever is holding them back.

And that’s why they’re successful.

Yeah. And I think of what you just said, I think this theme that we’re talking about keeps showing up for your work. It’s a practice. It’s true, guys. I know. There’s so many videos and books talking about overnight success, even if it’s not overnight. I’ve read so many stories about in six months, in one year, until recently. I gotta say, like, looking back on my own entrepreneurial journey, I had always thought that, oh, I’m such an underdog. It’s just taken me so long to get to where I am. I started my business in January 2016 and had to pivot several times. So I thought to myself that the way you talk to yourself is really important, right? So it’s important to not say things like, I should have been somewhere else by now, and I’m not. I’m a failure. Or like, this work is not guaranteed, and therefore it’s a waste of time. And it’s really not like yesterday. Elaine, when you said, when things started to connect yesterday, I had this moment where I realized that, wow, I saw Skillshare. I have several just a few courses there. Skillshare cut me a paycheck and was basically the biggest amount I’ve seen.

And I was in for February 2022. At the same time, I sold five of my digital products. One of my courses, I thought I priced a little high. That came in literally all happened yesterday. Granted, when I look at my consulting side of the job, which I get to charge a lot more, but to see the passive income to finally coming together and showing me that I’m surrounded by way and it’s really exciting. It’s going to probably take longer than you want it to be. So make sure you know that you’re not alone and you’re not a failure if you’re on your way. So keep showing up for your work.

That is such a good point, though. Every once in a while I’ll get somebody who said, elaine, I read the Million dollar one person business and I got to 1 million in one year, and I can’t believe they can do it. Usually it’s in ecommerce, because if you get something right, then you just amplify it with ads. For the most part, it’s 5710 years. That’s why it’s important to pick something you like thinking about, because otherwise you’re going to go crazy. You won’t want to show up. But that’s also a lesson. If you are showing up for something and you hate it or you’re procrastinating, it might be that you’re not doing the right business for you. It’s not just about making money. You have to enjoy the discipline that you’re in and enjoy thinking about it. Like I had in the first book. Alan Walton runs a spy camera store. He loves he worked in a brick and mortar store that sold those, and he got really into it and he loves talking about it, he loves researching it. I don’t really know much about cameras. I couldn’t run a store like that because I wouldn’t want to learn about cameras.

It’s not my thing. But if I have yoga mats or something, you should be trying them all the time and, you know, flying all over the world to find them. And so you got to think about who you are and not worry about, like the shoulds. Like you said, I should be at this place or I should be running this kind of business, or I should do whatever. There’s no shades with this. Can you find a business that you love and then does it serve some need that other people have or want? And if you can marry those two things, you’ll be very lucky.

Absolutely. So we touch upon what I display on the screen just now, quick ways to generate great business ideas and test them out for Viability. And I think there are so many examples, Alaina, you shared. And I think what people are thinking about is, damn, I’ve never even heard of some of these brands. They’re satisfying. Maybe some of my needs right now. Like I don’t wear high heels, but I often struggle having to stand for a long period of time or go for long walks. I would love to have comfortable shoes and my needs, for instance. I know other people as well. Your body is not the same as you age. So I think it’s really fascinating. But at the same time, people are sitting here thinking, well, I think I know who I am, what I want, what are some of the places, resources I can tap into to find some of those ideas, and how long? I don’t know. Elaine, do you ever ask a question like how long is too long to test out an idea? You even write about names like how to test out the name of my business, the concepts of my ideas.

If you could talk to, that would be great.

Sure. Well, I think your gut instinct will tell you how long it is. Like, if you start to lose interest in it, that’s too long. You can spend an indefinite amount of time testing if you really determined to make it work. But at a certain point you have to look at like, am I the only person in the world that loves this idea or not? There’s a tool called Pickfu that I love where I actually tested the title of the book. It’s Pickfu, and it’s a paid survey where you could put up, for instance, different brand names like I tested Tiny Business, tiny Business, Big Money, and I tested eight titles because I have the Street Fighter strategies in the book. I was going to call it Street Fighter originally, and in part because for years I’ve studied taekwondo, and obviously what.

I did too.

But it is a type of street fighting. And I thought there’s a lot in that mindset of being prepared for the unexpected is very valuable for small business owners. But then when I thought about it, I was like, maybe that’s too triggering for people because you’re thinking about fighting. So this is the kind of thinking that goes on in your head when you’re an entrepreneur. So you’ve tested and the people who respond. You can pick a demographic like, say, for instance, college educated readers tend to be the biggest consumers of books. Say you wanted to test it against college educated readers. Then you can select for that demographic within a certain age range, within certain countries, etc. Et or within the United States. Or say you want to target military people or women with young children or whatever it is, but they have to provide written feedback, and it’s really, really useful. You can also do things using social media. One of the entrepreneurs, Ana Gavia, I loved her story. She was a medical student in Australia, and she sketched in her spare time. She loved fashion, and she grew up in a beach community and was always in search of the perfect bikini.

So she sketched this bikini and she went on Alibaba, which is a marketplace for finding factories and other resources for manufacturing. And she found this little factory that was willing to make one sample of the bikini. She only had $200 to invest in the whole business as a student so they made the sample and she had it made in size medium. She put it up on Instagram and she said she spent like $6 on Facebook ads to drive traffic and she saw if she would get pre orders. Well, the women liked it and she got 1000 pre orders. So then she went to the factory, which was willing to do a small run because they don’t just like to fire up the factory for a hand. That would be like a handful compared to what, you know, Ralph Lauren or somebody would order. And that was how she grew the business. And she would use the money from the first bikini to fund the next idea. But the critical part was if nobody ordered the bikini, she didn’t make it. So she didn’t waste her startup capital. I thought that was brilliant because it’s a way of having a no waste business.

It’s also ecofriendly because when you think about it, like, think of how many clothes, like, end up in landfills because some crazy trendy style came out and nobody wore it. And it’s bad for the environment. In fact, one of the businesses in the book, it actually Pivoted Sincere Sally. It’s a fashion business. And I was going to reach out to them to do an update story on that business. And it had jewelry on the website. I was like, Wait a minute, I thought it was a fashion business. And then they had a note on there. It’s a brother and sister. They said, we decided fast fashion was too hard on the environment, so we pivoted to jewelry. And I thought, well, that’s the beauty of a tiny business. One other way you can test jason Van der Grant is Toronto entrepreneur who does CAD design, a type of engineering design. And he has 40 contractors around the world. And he’s got a lot of ideas. He’s always got ideas. He wasted. I don’t want to say wasted. He learned from investing $29,000 in an app he developed. He likes to wear stylish sunglasses, so he thought it wouldn’t be great to have an app to find the best prices on designer sunglasses on the web.

I guess he didn’t know that there were a lot of other ones out there. So as soon as he put it up, he launched it. And then he saw there was so much competition, he literally closed it down the next day. And so he said, I’m never going to do that again. Now what he does is he gets a GoDaddy website which costs $30 for the month, and he’ll put a design up there for what he wants to sell. And he does the same thing. He sees if he gets interest, and then if not, he doesn’t go any further and he just shuts down the website. So these are ways that most people realistically don’t have a lot of startup capital. In the beginning, they almost always fund things. Themselves. Very few people go to Silicon Valley with just an idea and come away with 3 million in seed funding or more. It just doesn’t happen as much, especially for these types of businesses. So you have to maximize your capital. And the testing now is so easy because of all these Internet tools that keep coming out. I bet by next week there will be some new ones.

So, yeah, there’s a lot on that because I think this is really vital for empowering entrepreneurs who are starting on a shoestring, for sure.

I keep leaving links. By the way, what is Jason’s last name again? I didn’t catch you.

Vander Grant. Do you want me to type it in? Because it’s a hard one to spell.

Oh, yeah, sure.

I’m trying to get into the chat. Let’s see.

Yeah, while you’re doing that, I think lessons I have learned also is one thing from Josh Green. One of my colleagues from Arnold years ago said something, and as soon as I decided to leave the job, he said, you know what? Just relax. Not everything has to work. Like, literally, that has never occurred to me before, that everything we talk about is like, oh, this has to work, that has to work. And I realize not necessarily, and I think it is just giving us not necessarily a way out, but just like, take it easy on ourselves, like honoring ourselves, our ideas. It is so important. So I’m going to drop this. I wonder if this is the right link. Oh, wow. I think maybe I’m going to just drop in a chat. I’m going to just show it on the screen right now. That looks about right.

Yeah. There’s a course, actually, for entrepreneurs that he priced it. I think it was like $33 or something like that. I think he had turned 33 or something at the time. But he has a lot of good things to share like that because he doesn’t have payroll in the business. But he has so many contractors. By the way, with this book, my criteria was either they run payroll or they have a team of contractors that’s more formalized, where they have Monday meetings or something, where the entrepreneur can’t just hide out and ignore everybody, where they have to really be actively involved.

$30.

Okay, that you found it.

This is so cool. So related to that. Money is always a topic. It’s always a problem. I think it’s really interesting that when people think about entrepreneurship and frankly, the way I funded my business was that I had savings. I’m one of those very traditional immigrant daughter. I started putting eight to 10% of my check away since I was 22. So by the time I was 32, ready to start my business, I had a cushion that I could live off of for well beyond six months. Guys, if you have a family, you can’t just say, oh, I have six months of saving because some internet article told me to do so. I was much more comfortable with like a year and a half to two years because witness something doesn’t work. So that has to work for you. And I was also ready to just like Elaine said, not give up the idea of working. So I left my full time job, continue to leverage my skills as a digital producer, project manager for local agencies who really appreciated my skills. That worked out great. I was working halftime and putting the other 50% of my time into Face World, possibly more, because I was able to work from home.

A lot of the times I eliminated all the commute times. I didn’t watch a lot of TV and I was just much more productive and effective with my time. But with that said, if you need to find money, owen has research how to do that.

It was really interesting because I think your story is very much like a lot of the other entrepreneurs in that they had to sell fund in the beginning, especially if you’re doing a service business, it’s very hard to raise funding at all, even if it’s grown until it’s like a middle market accounting firm or something like that. And even for some of these smaller businesses like Ecommerce stores, there really aren’t that many investors going out there to back people to start those things. So you have to think about whatever resources you personally bring to the table. Crowdfunding is a good one for a lot of product based entrepreneurs now because there are no barriers to entry, venture capital and angel investment. Those are somewhat who, you know, type businesses and they don’t have a great track record of investing in the full spectrum of entrepreneurs. And just from having been a reporter for a long time, the numbers haven’t really moved in 20 years. So if you’re not plugged into that network already, you might want to look at some other other options. Crowdfunding. Interestingly. Crowdfunding is an area, one of the few in financing where women outperform, they excel in social media.

Yeah.

Awesome.

Yeah. Indiegogo Kickstarter. That’s what Vanessa Josuani did. She runs a business called Nomad Lane and it sells a travel bag. She and her husband Kishwasani, she started this as an Etsy store where she was just selling various accessories and she discovered her travel products did the best. And so they decided to sort of double down on this one bag that she had and then she added a lot of pockets to it and people really liked that you could fit a laptop into it and they raised 2.1 million on Indiegogo. She did a lot of work ahead of time to make sure it was a successful campaign. She worked in marketing and she had a lot of good tips that she shared. Like on the day of the launch, she sent out a calendar invite for people to preorder the bag. And that really helped, because if a lot of people order the bag at the same time, then it goes up in the kind of internal SEO of Indiegogo, and then the people that ran Indiegogo notice and they boosted it, which then, you know, it’s like a snowball rolling down the hill. And so they did great with that.

But then during the Pandemic, as we all know, not many people were traveling. And so the business was up to about 3 million. And then they made like 1 million in the first three months of 2020. And then they basically made no money the whole rest of the year. So what they did, and this is why they’re in the book, is they found an opportunity there to generate more revenue. And they created a Zoom call every week where they would talk to their fellow travel lovers. And they, from that call, realized that the people who liked the bag wanted one for daily life when they weren’t traveling. So then they introduced this. It’s called the origami tote bag. They went back to crowdfunding again, and this time they crowdfunded that bag. So now they have two products. And now, guess what, we’re all traveling again. So now they’re growing the business back to its usual pace. And that’s kind of what you need. Like they came into it. They self funded. Kish had actually gotten fired from a sales job for not making his numbers, and neither one of them wanted to go back to corporate.

And they made it happen. But they did. Master Crowdfunding That’s what I learned. It’s like, you don’t just become an overnight success on these platforms. You’ve got to really be diligent about building up a following, et cetera. Another one that was really interesting was grant funding that’s taken off during the Pandemic, because for years, I know as a reporter, people would say, could you write a story about small business grants? And I’d be like, which ones? Is like, the SBIR grants from the government. That’s about it. Now, there are a lot there were a lot of grants that came about. There’s a team of women, Jessica Ochoa Hendrix was one of the founders. They started a business called Killer Snails, and they got grants to fund it. It’s an educational game company. The nice thing about grants is you don’t have to pay them back. You have to account for how you spend the money. For instance, she’s an entrepreneur, but she had a scientist on the team. So because of the scientist credentials, they could get certain grants for this. So that’s one to look into. Bank funding is also kind of interesting to me, because I always learned from doing interviews that it’s very rare for entrepreneurs to be able to get bank loans out of the starting date.

But there are exceptions. And what I found was by really cultivating your credit score and treating it as an asset you can actually start building a relationship with your bank and get some funding, which can then be the door to more funding. There’s one entrepreneur, Shaquille Prasla. He’s a young guy, didn’t have a loan credit history. He started an e commerce store, and then he wanted to acquire other ones, and he actually got an SBA loan for the acquisition, but he’s really careful about paying everything on time, and then he wound up using funding from cash flow from that business to buy other ones. So it’s not impossible. If you’re really careful, and I think especially for midlife entrepreneurs, you’ve probably built a lot of credit over the years just managing your own finances and your personal credit is really what banks look at. When you’re an entrepreneur, the business is not well established. Really good personal credit. Then you probably can tap into some traditional credit, even if you start out with business credit cards, and then you graduate on to the Kogan. So those were just some I could go on all day about the financing, but there’s a lot about that, because that’s where you do have to be kind of a street fighter and be prepared for the unexpected.

And like, you were diligent about saving eight to 10% of your income every year, but not everybody is. But so if you don’t have that, then you need some sort of cash cushion where you won’t have the runway to grow your business idea.

Yeah, these are I just feel like this is what a privilege to be able to just share so many links and real examples as we’re talking about this. One thing I love about one very, very important lesson oh, my goodness, I’m rolling my eyes. That’s mentioned in the book, I think it’s so essential, is, guys, please don’t rely on a 25 page shiny business plan. It pains me to say this. In the past few years, three of my friends that come to mind I will not mention them by name, who found themselves in starting a business, just like you said, is that Activating Energy, something they’ve wanted to do for a long time. Then they started doing this, and the first thing that comes to mind for them was to hire a professional business planner or a business plan writer.

Yeah. That’s a whole field.

Yeah. And it’s incredible. And then, for some reason, here’s a trend I’m witnessing that I said, okay, since you already invested in that, let’s take a look at what you’ve come up with so far. It takes a long, really long time, months, sometimes the the entire year, to focus on a business plan. And to me, that is something that is such a red flag. One, that you spend a lot of money, you invest all your money into writing a plan. Two, you’re not testing with your customers, with your market at all. And three, a lot of the plans I ended up reading are targeting. As such, big brands are asking for a lot of money on something that’s not clearly defined because you’re just starting out. So I would love to hear your thoughts on kind of experiences with people with or without a business plan.

Well, this is a topic near and dear to my heart because I ran the Fortune Small Business Business Plan competition for five years, and I worked there from 1999 to 2007 and got to see a lot of the and I was running it up until it was, like, probably the last four years, five years that I was there. One of the companies that won was Property Solutions, which now has a new name that I forget, but they became a unicorn here in Utah. It was started by freshmen in the school. They were, like, 18 or 19 years old, right? And we had really great judges kay Kaplabitz, Ann Winblade, Michael Greeley, Andrew Sherman, like, some really top names in the small business and entrepreneurship space. And the thing I learned from that competition was the businesses that made it, that are still in business right now are the ones that went out and tested it in the market. And I was an editor at that time. I did not have a business, but the judges always had a bias towards the businesses that were out there testing and selling. And I think that’s because ultimately, that’s what a business is.

You have something and you sell it. If you spend time massaging the business plan for a year, there is room for strategy and planning in anything. Like, even with my book, I spent about a year outlining it because I had a lot of material. I didn’t work on it continually. I was working on a whole bunch of other projects at the same time. But that’s about how long it took because I needed to think through, how is it different from the million dollar one person business, and where do I bring value? What can I do that really makes this very useful to entrepreneurs right now? That takes some time to think up, but at the same time, if I didn’t sit down and actually write it yet, then what good does it do anybody, right? It’s not getting out to the person that might benefit from it. So you do have to kind of put yourself out there. My kids, because we all do martial arts, I’m always like, you have to get in the ring. And my daughter Anna once said to me, mom, she didn’t get in the ring. And I was like, that’s a family thing.

But you really have to do that. You have to be vulnerable and be willing to have people hate your product and give it bad reviews. Ideally, they won’t, but you have to put it out there and get real world feedback. Otherwise it won’t be a business. And all these people you’ll see in the book, they make a lot of mistakes. Sometimes things they try don’t work, but they’re committed to continuing to improve and don’t view it as a judgment on them as a human being where they should just crawl up into a ball and hide. They just get back up and they keep working.

Yeah, it’s so true. I can share a very recent experience where I really kind of admire, respect this business and part of my YouTube strategy as a business, I ended up providing a kind of what we call a first look channel review. So it’s not like a channel audit or anything. So I sent it to this entrepreneur who is very kind and who’s very, very busy, replied to the email for the first time after I’ve done dozens of these channel reviews. He said, I don’t find anything really inspiring. It’s not very helpful, you’re telling us what we’re doing, right? But I just don’t see any value in it.

So because of that knife in my heart but I do appreciate the feedback.

You know, I gotta say, I’ve developed such thick skin over the years, I really wasn’t the person I am today. And I didn’t take it personally at all. It was slightly embarrassing because one of my business partner was also copied on it. But what’s interesting, guys, this is the reason why you can’t take that personally, is the gentleman replied to the email to say, hey, I also published a book, have you seen that? And I was like, wow, that’s like the second thing I mentioned in my video about how to connect your book to your YouTube channel and to create some synergy. So there’s a lot of things that a lot of tips. I provided in a five minute video, but I’m pretty sure he didn’t make it past the first minute and then send the email. So I decided not to take it personally. And the second thing I’ll say I did this, and I really appreciate my business partner for reminding me to do this, which is really a collaborator. Facebook is pretty much run by me, and this collaborator said to me, hey, how about we hop on a call? I said, Well, I don’t know.

I think he said in his own ways, she’s like, oh, I know, and don’t worry, let’s see. Clearly he didn’t really watch this. Maybe there’s an opportunity for us to connect. And he came back and was very enthusiastic about connecting again. So sometimes you really can’t and should not take everything personally. And that reminds me of another great example that Lane wrote in her book Tiny Business bake Money was, oh my goodness, we all made the mistake of a business person trying to we don’t think about this as consumers. If you call up the credit card company and to say, I don’t recognize that charge for a variety of reasons, you didn’t call up their customer service that they could easily resolve the issue for you, or you didn’t even recognize the charge. Sometimes the name has nothing to do with the product I purchase. I don’t recognize the name. You call it up. You call up the credit card company. The company will actually get dinged really badly, and it’s a red flag for them. And, Elaine, you wrote about this business owner who called up the credit card company, spent hours the entire afternoon trying to clear a few charges that were eventually worth $100.

And that was Anthony with the box company. Yeah. And that’s when he realized his time is valuable, too. And you do need to look at the big picture, but also, I think there’s something valuable when someone really hates what you do, because inevitably you put something out and there will be someone who hates it and you feel really misunderstood. I remember someone posted a review of my first book that it didn’t have The Fundamentals of Accounting in it. And I was like, that’s helpful for me to know that somebody would like The Fundamentals of Accounting, but that’s not the book that I’m qualified to rate or that I want to rate. That’s not what this book is like, they can get an accounting textbook or, you know, profit first accounting or there’s a lot of good books in that space, but it helps you get clear on your vision and to say, I can’t be there for every possible customer. I’m not Jeff Bezos. I’m a tiny business hoping to make big money, and that helps you to narrow your focus. A lot of these folks are niche players, and they really own that niche.

And even within a niche, there are going to be people that have maybe they’re passionate about it, and they have a strong opposite point of view on what is the perfect yoga mat. I like them thick. Maybe someone else likes them thin and made out of a different material. But it helps you get very clear on what you’re offering is I think it’s okay to allow yourself to mutter about it in your head while you’re out jogging or something and get over the hurt of the negative feedback, because we all have feelings, but at the same time, you cannot let it distract. Like you said, having a thick skin is really important because otherwise you won’t realize what you want to do.

Yeah, exactly. It’s too important if you really take everybody seriously, which, unfortunately, I think we’re brought up to do. And especially if I think with certain trauma, with certain history associated with your childhood, always trying to be a pleaser, which, unfortunately, I fall into that camp, and it takes a lot of years to unlearn that and to really respect and honor yourself. Speaking of honoring yourself, disney plus recently came up this movie called Turning Red. Oh, my goodness. It’s like too close to home, but it’s just an incredible feature film that they have even for entrepreneurs. I think once you watch that, you realize, you know what, I need to honor myself and do something that’s right for me. And even like Elaine, another area I have to call out at the very beginning of the book, you mentioned that it’s not so much about your family, your friends, your loved ones telling you what you’re good at, what you should do. You got to learn that about yourself. And that part I think we need to talk about real quick. That’s too important.

Well, it is a journey, right? And I think you have a great opportunity when you start a business to learn a lot about what matters to you because you’re now the boss. So you decide what your day looks like and how do you want to spend it and which customers do you like working with and when do you say no to certain money. Because it comes with things that you don’t like, like a toxic customer or type of work you don’t want to do. It really helps you to get to know yourself. And I think if you’re open to that and not just thinking of it as purely transactional. Not to mention the relationships that it brings into your life. I mean. That’s been the best part for me of having a business is all the great friends that I’ve made. Even from doing podcasts. Like. Just the friends I’ve made through this. It’s such a tremendous asset. Really. Beyond the business. And you do like I was thinking about this the other day with my ghost writing clients. A lot of times I introduce them to each other and I’m like, on paper, I really have nothing in common with a lot of them because usually they’re CEOs of much bigger companies.

And for whatever reason, a lot of the ghost writing clients have to be men. It seems to be something men more easily outsourced than women. I don’t know why, but I thought, what is the common thread among them? There’s something where they’re all interested in a lot of the same things. And, you know, I thought, well, there must be something about me that’s connected to that, but I don’t know what it is. And so you start thinking about these things and it brings you self knowledge. So I think for everybody. There are opportunities in their business to just get to know themselves a little bit better and create a lifestyle and a life that really is for them. Not the one that parents want them to have or other. Wellmeaning. People. Because I am a parent and I get it. You know. But what they. You know. Who they are truly meant to be and you don’t really have that opportunity so much in corporate jobs. Some companies allow it. But I was talking to someone the other day about the slogan, bring your whole self to work. Right. When you say that, everybody laughs, right?

Why did they laugh? They’re like, yes. Bring the whole camera ready. Perfect demographically. Average self to work.

Yeah, exactly. Not to be judged.

No tears, no messy hair.

Yeah, exactly. Perfectly dressed. And there’s almost especially working in Boston, like consulting or marketing. It’s almost like everybody’s got this uniform we used to laugh about. I forgot. Now I just remember, like, your Tory Birch flats, your Ray Ban glasses, you know, like cat eye glasses and hair. Certain products, like, so funny, the men and women to get together, like, oh, my God, I didn’t realize we’re all shopping in the right places. And, like, it’s not by accident. You looked at each other and you recognize what’s right for that environment. And speaking of Wedge Lane. One thing I know I have so many questions for you. But to respect your time. There’s one area that I feel like I need to kind of probe and kind of chat with you as well as a small business owner is that during the pandemic. But also before that. I realized that by choosing to be an entrepreneur. You have left a part of yourself. Part of your life behind. And to me. As a woman without children at the moment or may never have kids. Frankly. And there’s one part of that which was kind of a little bit strange at work sometimes.

Like. To be left out of certain conversations. Even though I love children and the other now. It’s like. I feel like it’s completely left me is the idea of the ability to complain about work nine to five. Commute. All these things. I’m just not part of that conversation anymore. And frankly, I’m pretty glad. But I do feel like, like you said, my network of friends and have completely transformed into a different group of people who have different belief systems. Everything is different because of this podcast, because of YouTube. Sometimes I feel like I’m having a conversation with myself. It’s like, do I want to go back? Do I miss it? Do I embrace what I have now? How do you navigate that part of your brain and self knowledge?

Well, I think one thing that I found is that life is full of surprises. And my friends can believe I have four kids. I started my family at age 37.

Wow.

And I was like one of these women who I loved my career. I really could have just done my career in journalism the whole way through and been very happy and fulfilled. And then life had other plans for me, and I decided at a later age I wanted to have a family. And I’m very lucky. I have very nice kids, but I never expected that. And there’s a lot of unexpected in life. So I think if you think about the fact that we don’t know what’s going to happen to us and not put ourselves into any one box because I have those same emotions sometimes when my friends have kids at a younger age and felt like I wasn’t part of that, but we’re all connected. My yoga school says that not to be too woo woo, but really, if you look at all the world’s great religions and pretty much any system of thought always says it comes down to that. Like, all human beings are connected and we’re all part of this whole life journey. Let me just accept where you are. I think that’s the most important thing. You can go back, people can toggle back and forth between corporate and non corporate careers now much more easily.

It’s funny, my mother is 78 and she got a full time job yesterday. A couple of days ago, she was bored at home, and I was thinking, most 78 year olds don’t really think that way, but she wanted a different lifestyle than being retired, and so she went back into the workforce. And so you never know what life has in store. And I think we put a lot of pressure on ourselves to think we should be doing a certain thing, or if we close one door, we can never go back. But life is a lot less linear and hierarchical than it used to be. And also the great resignation at the moment. Things cycle back and forth with that. But a lot of companies need people, so you have more leverage as a worker to come back in if you’re doing the entrepreneurial thing and you’re like, you know what? I’m so tired of eating what I kill. I’m hustling up the next sale and I need a rest. I want to rest on someone else’s payroll. I’ll do a great job, but I just don’t want to do the sales part of what I do anymore.

You can do that. People do it all the time. So you’re not shutting the door unless in your mind you do and just throw up mental obstacles. I mean, we’re all our own worst enemy with this stuff, right? Like, all the stuff that goes on in our head is worse than anything anyone else would do or say to us. So it’s like looking at it a little more realistically and hopefully with friends, maybe like friends in your same career who can be an objective sounding board or we’re a coach type person, a life coach or business coach. A lot of the people in the book had an informal peer group of friends that they run things past. It’s a real issue, though, because we’re communal. We’re meant to be in groups. And so when you break away from one group, you might be joining another one. But there’s mixed emotions around it.

Yeah, well, that’s absolutely true. And love it. And yes, if you’re on that journey, finding that community, even just a few people, you don’t need a group of like 200, 300 people. Even just a small group can carry you further out. And I. Love all the examples. Elaine, you shared in your book. Tiny business, big money. I mean, there are pages and pages entrepreneurs, most likely you haven’t heard of, but yet it’s so relatable. Yes, there are many, many steps ahead of me, perhaps ahead of you as well. But looking at those websites, their examples, their origin stories just make you realize that perhaps you can do it too. A lot more relatable than the Amazons, the Elon Musk’s of the world. So I really appreciate that. And I would say that we didn’t necessarily get to cover everything that’s written in the book, for obvious reasons, but please consider picking up a copy. It’s a very relaxing, fun read. There are areas like things we didn’t get a chance to talk about, like how to put a system in place so you can maximize the resources, where to find them, the best way to spread the word about what you’re selling, what you’re building, and how to build an authentic brand, how to master the skills you have, how to be like a lifelong learner.

So all these things are, frankly, probably even more useful if you have to start and then begin to optimize your business. So I think the book is something that could stay with you for quite a long time. So I encourage everyone to really check it out, as well as the first book, not just the second one. But I do have a copy of the first book.

Oh, good for you.

Yeah, this is the first book, and then the second one to show you is this big yellow book. And I love the title. I know the references to taekwondo, so yeah. Elaine, thank you so much for joining me today. Anything else you like to leave our audience with before we head into the sunset and weekend and all that?

Well, thank you. Thanks so much, Faith, for having me here. I would just say there’s no credential for being an entrepreneur. A lot of people feel like, oh, you know, I need to get my MBA or I need to get a certificate, I need to do this or that. You really don’t. I mean, this is one thing that you can decide if you’re ready. And so I encourage people. It’s hard when there’s no gatekeepers telling you whether you are ready or not, but take a chance on yourself and see what’s the worst that can happen. If you start a side hustle, if you use some of the methods that these folks have been so nice and sharing with me, maybe the only thing you’ll waste is $200. And it’s worth it to bet on yourself, taking an educated bet.

Bet on yourself. I love it. Thank you so much.

Ole.

I’m going to take off offline now. Please stay on just for one more minute, but for anybody who is watching, and we’ll be watching this later on once we end this live. Thank you so much for spending the time with us. And I’ll see you next time.

Bye. Thank you.

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