I took some entrepreneurship classes at GW (supposedly one of the better business schools in the country). I wasn't impressed. Not that the cirriculum was bad, just that the classes never addressed one of my objectives, starting a company without any money.
Of course you can't start a company with NO money, but you can start a company for very very little money. I'll center the example off of my plan for Splendid Web Solutions. Here's how:
1) Choose something you can do yourself, and can later be done by other people
2) Choose something that doesn't take many tools (software, hardware or otherwise), or uses things you already have. I had a computer already, and I already had internet access.
3) Find a partner that provides most of what you need. In my case, I needed hosting services (which I wouldn't provide or take credit for), and I also needed the online editing software for customers to use. Ivenue had this, and I found a hosting company with their software.
4) Spend money only as you make it. Essentially you are paying for something on a commission basis. In my case, each time I sell a site I pay the provider $250 for the site. I charge about $2500 on average, so the ROI.
5) Make some money. This is why you need to be able to do it yourself. Do it for a while before you hire anyone else. Other people cost money and it's easier to get someone once you've proved yourself.
6) Incorporate. This has all sorts of protections, see othe posts.
7) Hire people. I started by hiring a friend who did sales. I didn't have enough work (I wasn't working otherwise when I started). he knew sales but not web design. So I paid him COMMISSION. Every site that went trough I gave him a percentage. He loved it because he generally made much more than working at his company, but also because he could work on his schedule. I get the benefit of more projects without having to get better at selling the sites. Also, since he's on commission, I have no costs until he sells a site, at which point I have made more money than I need to pay him.
7.5) I also hired web designers to work on commission. They basically do the whole thing from finding a client to designing and selling the site. This is great since I do literally no work but get a percentage off each sale. I'm aiming to have 10-15 of these people in a couple of months.
8) Expand. Get bigger, grow the business, and move on. I'm going to try to get enough people doing design work, and maybe get some doing just sales (sales work gets spread to the designers), that I can focus on other areas of the business. I'd like to expand the offerings to include internet marketing. Basically, I can take my current clients and offer services to help get their sites listed on other sites or directories, provide marketing guidelines, etc. Eventually that too can be managed by someone else on a commission basis. Everyone makes out well and gains some experience.
I want to emphasis that this probably doesn't work to start a traditional company. I'm using the model of student labor for one. Students are happy to make more money than they can sitting somewhere in a part time job. Also, they are willing to work to gain the experience of dealing with clients, selling sites, etc.
Saturday, October 07, 2006
Low Cost Startups
Thursday, October 05, 2006
reward yourself
To keep going at your goals I find it very important to reward yourself frequently. Your list of tangible items you want is a good place to start. First, make sure your lists include the smaller things in life. I love gourmet chocolate, so I've got that on my list. When I accomplish a goal I try to find something that is proportional on my list of things I want and get it. Often the goal and the item correlate financial in some way. A completed web site (and subsequent check) might warrent a pen or clothes. A successful sales call might warrent some chocolate or something. Basically you're training yourself like a dog to keep motivated. It really works.
Read Full Article......
Tuesday, October 03, 2006
Fidelity: avoiding investment mistakes
Fidelity has a page on typical mistakes made by investors. It's kind of boring, but good advice. Take a look here.
Read Full Article......Sunday, October 01, 2006
gas
We're in a gas crisis...yeah right. Gas is exactly where it should be priced, we just had a huge sale for 25 years. I've got some tips for saving money on gas.
1) Buy the right kind. I have a BMW, it says it needs premium gas, and it does. If I put regular in I get about 5 mpg less. That's about 20% more gas and only about 8% less cost. Doesn't add up. BUT, most people don't need premium gas at all. Get regular, it's only a few dollars each time, but it adds up.
2) Drive better. Accelerating is not your friend. Accelerate slowly and drive at normal speeds. I always hate this tip because I like to drive fast. The alternative is to get a german car that's tuned to optimal gas milage at 75 mph!!
3) In stop and go traffic drive in the right lane. I can't find the research on this right now, but statistically the right lane not only moves faster, but also has a more consistent speed. Consistency means better milage.
4) Get a stick shift. I get 40 mpg in stop and go sometimes. Why? Because I drive stick. The slightest downhill means I can coast down without using much gas at all. If I leave more space before moving when going uphill then I save gas there too. In the city I get about 22, far more than the 16 my parents get in their far newer and supposedly "more efficient" cars. Stick beats everything except maybe the hybrids.
5) Get a smaller car. You don't need an SUV, almost no body does. Get the car that fits your real needs. We've talked about this in other products (such as canned fruit!), do it with your car too. If you are the only person in your car ever (ok, sometimes two, we'll pretend you can get dates), you don't need a car that seats 7, you just don't.
6) Stop worrying about it. Ok this isn't really a tip on saving gas, but maybe on saving your sanity. Let's say you spend $1500 a year on gas. If gas prices go up 30 cent a gallan, that means your yearly cost goes up $150 or so. That's nothing in the grand scheme of things. Especially since you're saving all that money on othing things from making smarter decisions. :)
Read Full Article......
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