How to increase revenue from 0 to $ 1'000'000 in two years
This is a translation of a new TechCrunch article by James Altucher , an investor, programmer, article writer, and little entrepreneur. His last books: I was blind, but now I see 40 alternatives to college.
A few weeks ago I posted a post 10 reasons why you quit your job in 2013 . There I made some arguments. And it was not an article in the style of "Hey, you have to become an entrepreneur." Rather, the story was on the topic: bad shit is happening in the corporate world and sooner or later you will want to leave it.
Of course, many people asked the question: What next? What should I do?
And I began to ask people who have already gone this way. What did they do?How did you manage to earn a million dollars by quitting your job [at the corporation]?
Not everyone is Mark Zuckerberg or Larry Page. Not everyone will drop out of college and create an iPhone or a time machine or toilet, which changes its size depending on who sits on it (although that would be cool).
It would be enough for some people to simply leave their current job and live a pleasant life. Someone just wants to leave the company in which they are employed and earn a million dollars. In one film, Justin
In truth, in most cases a million is very good.Not everyone is destined to become a specialist who received one hundred million from investors. Sometimes it’s very nice to be a boss to yourself, to make a million and use this financial freedom to fly to the heights of success.
So I called Bryan Johnson, the founder of Braintree . You may not have heard of her, but you know her clients for sure. The company provides card processing and payment acceptance services to companies such as OpenTable, Uber, Airbnb, etc.
I've never talked to Brian before. And I am not a Braintree investor. And, as far as I know, I did not invest (unfortunately) in any of their clients. I like to call people who in my opinion can tell an interesting story. So I built my network not only of financial contacts, but also of potential friends. I’m shy and ugly, so I don’t have many friends.
But I knew that Brian could tell a good story about how he created Braintree and decided that it was perfect as an answer to the question “what to do next?”
In 2007, Brian was a manager at Sears. He quit and two years later began to earn more than a million dollars a year. As a result, the company grew significantly more and raised $ 70 million from Accel and others, but I was not interested in that.
“How did you do this?” I asked. “What were the first steps?” And he told me, and I share it with you.
“I hated my work,” he said. “And I never believed in the idea of getting a fixed salary. I used to have to work as a salesman in the bank card processing industry. I went from client to client and suggested that they switch to accepting cards through our company. And it occurred to me that I could do the same, but not work for the company, but for myself. ”
Rule No. 1: Eliminate the intermediary.Instead of contacting the company where he worked, Brian went directly to the bank card processor. He signed a reseller agreement with them and started doing all the same things that he had done before at his previous job at Sears.
Many people ask me: “Is it worth it to attract investment at the moment while you are still working in your current place?”. NO, of course not! First you need to fuss a little. Investors like to support people demonstrating the presence of balls. ( In the original - someone who shows a little oomph )
Rule number 2: Choose a boring business.All rush about in search of "the next really cool story." The next really cool story is to find rare earth minerals on Mars. This is REALLY DIFFICULT work. No need to take it! Brian chose a service that is interesting to almost any business in the world. He also understood that it was an explosive market. There is no need to develop a super-new-and-unique idea. Do the usual thing, but do it a little better than the rest. Being small and agile compared to hippos stuck in a bureaucracy, you can often offer the best quality service, sell better and keep in touch with your customers at a
Rule number 3: Find customers!This is perhaps the most important rule for an entrepreneur. I already wrote a separate post about this earlier ( The Easiest Way to Succeed as an Entrepreneur ). People want to go [to success] in some magical way - to get investor money, quit work, make a product, and then, suddenly, get a million customers. It NEVER works.
Brian found 10 customers (out of 12 that he proposed) who agreed to switch the acceptance of bank cards to his company. He calculated that he needed to earn at least $ 2,100 a month in order to leave work. The first 10 clients generated a profit of $ 6,200 per month, so he was safe. He left work and suddenly found himself in business.
Rule number 4: Increase self-confidence while sleeping.Typically, this phrase sounds like "Earn while you sleep." But Brian was already making money with every transaction while asleep.
“I had no desire to walk down the street and look for customers,” he says. “I needed a way to attract online companies as clients. Someone advised me to blog. To maintain a blog you need to be completely transparent, otherwise nothing will come of it. So I began to write about what is really happening in the industry, including cases of unprincipled behavior and patterns of customer manipulation. I published my posts on top social sites: Digg, Reddit, StumbleUpon, and from time to time my posts got to the top and there was so much traffic that my own site fell. ”
“All of this has made me a trusted source of information about the card processing market. "Very quickly, many sites that had problems understanding the card acceptance industry began to switch card processing to me."
A couple more things follow from this.
Rule number 5: Blogging does not make money. A blog creates trust. You will not sell advertising on a blog (with rare exceptions), you will not be able to sell it in the form of a book ( original get the big book deal ), but then you will get trust, which will lead to many opportunities. In the case of Brian, the result was an incoming stream of customers, more than if he went and spud them himself. My own blog earned me zero cents, but created millions of opportunities.
“In general, once OpenTable called me and said that they want to develop software for storing bank card data in order to provide this service to restaurants, and, of course, meet the requirements of regulatory authorities. We signed a contract for 3 years, which allowed me to hire developers and create a solution. Now we have a wider range of services. ”
Rule number 6: Say YES!He started by connecting sellers and a card processor. Then he was asked to develop software, although he had never done this before. And he answered YES! He hired developers, created a great product, and increased his revenues 4 times or more. All this led to the fact that his business reached incredible heights. Word of mouth earned money and other companies began to use the services of Braintree: Airbnb, Uber, etc. Investors began to call, because all their customers said that Braintree provides them with a full range of payment services. It is not so easy for startups in the field of online business to organize the acceptance of payments.
“When I just started, each client and I prepared a whole pile of documents confirming that this seller can be trusted and that he will conduct a legitimate business.”
It follows ...
Rule number 7: Customer service. You should perceive every client, new or old, as a human being. “We had some feeling that we were not happy with the competitors’ method of working with clients: the voice menu when calling the hotline, the long processing time of applications, poor indicators for solving problems, etc. So we made sure that as little friction as possible from treatment to the actual solution of the problem. ” Small businesses have no excuse for poor customer service. Your best new customers are old customers. And there is no better way to win them over, except to quickly provide support to them, at the moment when they need it. Good support is the most effective and reliable way to maintain customer relationships.
In his second year of work, Brian earned more than a million a year, and this figure doubled annually. They did not have time to hire people.
In 2011, after four years in business, Braintree first accepted an investment of $ 34 million in Round A. Now, according to TechCranch, they process transactions totaling $ 8 billion a year.
Not bad for someone who quit their job and just wanted to find a way to pay their bills.
- P.S. Suggest edits through the LAN. Thanks.