If I Knew Then What I Know Now

This is a guest post by Peep Laja, CEO of Traindom.

What is it that you wish someone had told you years ago? When you were starting your company, your blog, or merely thinking about creating something awesome?

The following is my list – maybe it will save you some blunders. Of course, some things you just have to go through on your own and learn from your mistakes, but here’s my list in case it helps.

1. Have Your Business Model in Place

Do not begin doing business with just an idea and a website. Before you storm ahead into a new project, think through your business model.

For example, my first web project was Catpert. Cat related information was searched for a lot online, and it seemed to me then that if I made a website about cats, I would be successful. What I did not think of was that there was already a lot of information about cats on the internet and even many high quality websites about cats. For the site to generate me passive income from advertisements, I needed to be much more dedicated to it than I ever intended to be.

Before starting a new project ask yourself:

  • What kind of problem, that is not already solved, will it solve?
  • Where does the business’s money come from?
  • How long does it take before I can start cashing in?

If your business model is that your website will be very popular and everybody will want to buy advertisements there, think again. This will not happen. If your business model is advertisement, then you don’t have one. You will have to have mega huge numbers of visitors to start earning anything significant from advertisement. This will take a lot of time and resources.

2. Create Value

We have many information directory type businesses, whose benefit factor for the consumer is around zero. A young man, who participated in my course, told me that his catalogue is beneficial because it allows users to find things they are looking for really quickly.

A little test showed that Google will find the information a lot quicker. Google creates enormous value with its service. Why would you even create a directory – Google has already solved the problem of finding information.

Contribute most to creating value for the client in all your undertakings. If you always consider the client (not your earnings) to be the first priority and you will do all in your power to help the client to achieve its goals, then you will succeed and the money will follow.

Recently, a reader wrote to me and complained that he is not making any money through the internet. When I looked at his website it was all clear. If you create a page that only contains over hyped text for people to buy your product, you will not be able to make any money. In addition to the product being shady, the whole website experience did not offer any particular value.

3. It Is Not All About You

People are not interested in you. All the people in the world care more than anything about only one thing– themselves. No one cares when your company was created, if you ate tiramisu at the office this morning or if your servers run on Linux.

All the services and texts on your website should be directed to the client and to solving his problem. It is not about you, it is about the people you serve.

4. The Money Is In Repeat Purchases

The hardest thing in the world is to make someone take out his wallet and give you money. To get to that point, you have to put in a lot of effort and hard work.

If you have created lots of value for one person, gained his trust, worked on building a relationship, earned his respect etc. –then it is pretty dumb to leave him alone and start looking for new clients to start over with from the beginning.

Do not deal with a business where you sell only once to a person. It is easiest to sell to a person who has bought from you before. Therefore you should constantly create and develop new products and services to sell to them more and more. Money is in repeat purchases.

5. Business Is Based On Human Relationships

Business is not based on beautiful offices, shiny business cards and fancy job titles. Business is based on relationships.

Relationships grow if you invest in your social network. Give and ask for favors but always think of ways you could be useful to people. One thing really successful people have in common is large social networks. Cultivate relationships, keep in touch with old acquaintances, be useful and be fun. No one wants to hang out with a grouch.

The best networking is spending amusing time together. For more on that, you should read Never Eat Alone by Keith Ferrazzi.

6. Don’t Be the Cheapest

Cheap is crap. It could be tempting to be the cheapest producer on the market, especially in the beginning. Even now you can run into web design companies that offer you an awesome website for $100. Yeah right. That is a lousy business plan.

It’s hard to survive with a narrow margin and there is always a guy who would do it for an even cheaper price. If not with the first, then at least by the third price war you will sink. People are willing to pay for quality and value – for you as an entrepreneur, it is easier to do business this way. It is also more inspiring to do something awesome then something that has to be toned down to cut costs. People appreciate expensive things more than cheap things.

7. Start Doing, Stop Looking For The Silver Bullet

I often meet people, who instead of building a business, are looking for the silver bullet. They buy information products, attend courses, and buy hundreds of books (which they do not usually even read).

There is no silver bullet. You cannot cut ahead. The idea of getting rich by doing nothing or very little is attractive and there are dozens of goons ready to take your money and tell you it is. But this idea will not really get you anywhere. You can work smartly but there is no substitute for work and creating authentic value. There is no magic button. We need more action. Overnight success is achieved after many years.

8. Live Below Your Means

Would you manage if tomorrow your earnings would drop by half? Living lavishly and over your limits is dumb. If you feel that you have to show someone how cool and expensive your car or clothes are, then you are deeply disturbed. Real value comes from within not from the things you own.
One is rich if he has the money to use when he really needs it.

Books that have researched the subject, The Millionaire Next Door and Rich Is a Religion, point out that often people who like to show their wealth usually are deeply in debt and can barely manage. And this stands in contrast with how truly rich (first generation) people act. Save something every month. It is easy to get trapped into spending. It is wise to create a safety net so you could come out from every recession with a smile.

9. Stop Selling Time

When I created my consultancy business, I found myself constantly working. I was living in Panama, which is a paradise on Earth and I was sitting in the office, working. Then an emergency bell rang. Stop selling time.

  • You cannot create time, everyone has the same amount of time.
  • To earn more you have to work more hours, and less time is left for yourself.
  • When you stop working, you stop making money.

Selling time cannot be scaled. You can only earn more by finding more workers, but with that comes huge costs and responsibility.

It is a lot more effective to do the job once and get paid for it many times. I sold my time for many years, until I realized that I will not get anywhere by offering a service. That kind of model will not let me live my life the way I want to. Instead of offering a service, offer a product.

If you are conducting a sales training, film at least one of them and sell it as a DVD. If you are giving advice as a gardener, write it down in an e-book or put your knowledge in an online course and sell it. If you organize your knowledge into educational products, you will do the work once but you can sell it endlessly and get paid many times. You can also create e-services which automate at least some of your services.

10. Wealth = Time

In conclusion we live our own lives and HOW we spend the time that we have is the most important thing. No one says on their death bed that they would have wanted to spend more time in the office. Time is the most valuable asset. Every fool can buy things, we all have credit cards. And how many laptops, cars and iPhones do we really need? For me the important thing is that I could take time off whenever I want to go out and play with my nephew; or to visit an old friend who lives on another continent or take my backpack and travel when I feel like it.

Experiences have great value. We may lose everything we have in life, but no one can take away what we have gone through or our memories.

We must strive towards more freedom and more free time. Today it is possible for everyone to consciously shape their lifestyle. One good way to make more time and freedom for yourself is to create your own internet business. Invest in your own knowledge.

What life lessons can you share?

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  1. says

    If you ever start a blog and publish posts, then do not close down your blog whenever you are feel de-motivated because you do not see any results and start a new site a couple of years later. Keep it instead and pay the monhtly or annual hosting fees, so that you can start again at any time later, your existing site will have a certain age-standing with search engines.

  2. says

    Peep Laja what a great article! Everyday in my business I’m pushing value to my customers! right now my business is still 5 months young but I have over 65 customers and they are all very happy with the service. About 40% of my customers have done subscription updates and I have built amazing relationship with them.

    Everyday I have two goals in mind,

    1. provide the best possible customers service.
    2. Increase the value of our service to our members.

    The most exciting thing about having a business is to imagine where you can be an a year or two from now.
    bbrian017 just posted Engage in the Blog Engage Monthly Guest Blogging Contests

  3. says

    Love this! These are all lessons I’ve had to learn too over the course of time. The ones that knock us down are usually the best lessons though. I have to add that I’ve learned not to get caught up with chasing customers or pound people over the head with a sales message. Instead, it’s better to focus on the person and their needs (your #3) and just listen then offer how you can help. And instead of chasing customers to put out great content and information and network on other blogs instead.
    Gabrielle just posted The 5 Laws for Launching Your Product with Video Landing Pages

  4. says

    I think older individuals and looking at what they purchase is a great way to discover what value is in repeat customers.

    I take, for example, my grandfather. He has his certain restaurants he loves, his places he loves to vacation, and on and on. All because of what those businesses have done well to attract him (through his personality, likes, hobbies, etc…) they’ve had a genuine, faithful customer for over fifty years in some cases.

    Can you imagine the value in that?!
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  5. says

    @Andreas Definitely good advice. Age contributes to ranking.

    @Brian Can’t go wrong with that approach :) every day is the election day in business

    @Gabrielle Exactly! Everybody can recognize insincere sales message full of hype (people’s bulls**t detectors are excellent), so focusing on them with an authentic message is the way.

    @Christian Well put! I recently read Gary V’s “The Thank You Economy” and his main message is the same: our grandparents are the best prepared to run businesses in the coming years.

  6. says

    This was a great post. I have struggled with point 7:Start Doing, Stop Looking For The Silver Bullet in the start of my blog. I was reading hundreds of forumposts, tried demos of “magic” link building tools, and looked for the best bookmarking and RSS tools.
    A lot of the time have been wasted, but I have also learned a bit on the way. I think your right, its hard work over time that gives result. Its important to keep going even if the links and traffic dont go sky high:)
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  7. says

    Excellent guest post Peep, you hit on some very important tips that I hope everyone takes with them. There is definitely no silver bullet, everything requires hard work, and time. Lots of it.

    Your tip in regards to the money being in repeat purchases is key. I see so many of my competitors come in with the game plan that they will under cut us and win some crazy battle. Meanwhile, they would be better off understanding the importance of quality customer service through-and-through. That’s where the gold is at.
    Extreme John just posted My Small Business Campaign on Facebook Goes Viral

  8. says

    @Dennis I think consultancy is a means to create immediate cash flow which is good, however, while cash is coming in, spend the necessary time to create the passive end of your business. Once your passive end starts generating you can cut back on consulting (or your JOB) if you want to or need to. Not selling time is right on.
    Rebecca Olkowski WordPress Small Business just posted Create a Lifestyle By Writing About a Niche You Love

  9. says

    I guess all I can say is that you can’t learn something unless you’ve learned failure over the course of time. I highly agree with your point on number 5 which states that business is all about human relationships. If one can’t have his own connections and relations with others around him, then surely he will fail.

    Great one Peep ! :)
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  10. says

    These tips are great. #4 is definitely one I need to keep in mind. I have an email list set up but don’t do a good job of utilizing it!

    Another tip I’d add is to note what you dread. I’ve been surprised that some of the things I’ve pursued online turned out to be less enjoyable than I anticipated. Now, if I try something new and it starts to feel burdensome, I drop it and move on.
    Amy Lynn Andrews just posted How to See Behind Any Website (Great for Tweaking and Design!)

  11. says

    I wasn’t quite sure where you were going with this post when I started it, Peep, but as I kept reading it I found myself nodding along in agreement. It sounds like experience has been a very good teacher to you. Sadly, I coach many small business owners that have 20 or 30 years of experience without having learned half of these lessons. Thanks for the great post. It was a great way to start of my day.

  12. says

    Hi Peep,
    Excellent post there. It’s good to know about something that I will do. I plan to run a clothing business with my friends and at the first time I did not what to do to start it. And then, I found your blog. Now, I have some enlightenment from your post there. Thanks.
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  13. says

    “Instead of offering a service, offer a product.”

    Cool, I’ve known about this concept quite awhile – passive income being awesome – but something about how you worded it here makes it hit home. Guess we just need to be reminded of something enough times before its importance sinks in?

    Think I do agree with the commenter above though who said offering consulting at first when your product isn’t ready is smart. That’s the point I’m at today with my Holistic Nutrition & Wellness Coaching business.
    Joce just posted 3 simple, tasty, high-energy, 3-minute, raw vegan recipes!

  14. says

    I think it definitely makes sense to offer consulting and offline training IN ADDITION to online courses / knowledge based products. They complement each other and often you can charge more money for offline services / products.

    Joce, if you’re thinking of launching an online product for your wellness business, take a look at Traindom as one of the options. Clearly I’m biased, but I really think we have the best product out there in its class .

  15. says

    One more lesson that the life has taught me is the following: never give up even if your business has been ruined completely, if you have to start from the scratch. If this is failed, try something else. And study – all the time because in order to be successful online you have to follow and keep up with the latest trends and technologies.

  16. says

    Amazing tips there Peep!
    There are things we wish we already knew. But I learned life doesn’t go that way, There’s no shortcut! We have to experience those mistakes to learn coz we’re not perfect.
    We’re planning to have our own site someday and we just have to make sure all of these tips and your shared experience will be applied. and we thank you for that. :)