Category Archives: Entrepreneurship

Here’s Why Your Online Marketing Doesn’t Work

And what to do about it.

When we are producing and marketing, we tend to look at our craft from our own perspective. Unless you build something for yourself and market it to yourself, that’s a mistake.

That’s a typical mistake that software engineers do. As a result, they end up with overcomplicated software that the end users can’t use.

If the prospective customers can’t use a piece of software, it’s a waste of time and money, no matter how good it is.

The antidote to that mistake is to put yourself into the shoes of the prospective customer. For example, I’m producing and marketing blog posts. Here’s a question that could help me.

How Did I Find My Favorite Writers?

I found Steve Pavlina from a Google search. I kept reading his blog throughout the years, bought his book, went to one of his live events, and recently purchased an information product of him.

I found David Hawkins from a post of Pavlina. I read his book Power vs. Force and then kept purchasing his books and audio programs.

I have the Kindle and audio versions of some of Hawkins’s books and read and listened to them multiple times. I came across the Letting Go Method in his book with the same title. It became one of my favorite personal development practices.

I came across a piece by Nathaniel Branden in the book Meeting the Shadow, and I read his books Breaking Free and the Disowned Self. Now, I’m going through his audio program The Psychology of High Self-Esteem with the intention to read and listen to more books and audio programs by him.

I really don’t know how many Brian Tracy audio programs I have in my audible account, and honestly, I don’t care. I enjoyed most of them, and the Magic of Self-Direction is one of my all-time favorites.

I guess I’m one of those 1000 true fans of these writers.

The point I’m trying to make is that I didn’t come across a favorite writer because they followed on me Twitter or Medium. They didn’t comment on one of my posts. They don’t have online link wheels. I didn’t find them via their Facebook or YouTube advertisements. Two of them aren’t even alive.

We’re all sitting on immense value, but we don’t care to stop and look inside because we’re too busy trying to catch the next shiny object outside.

Did I buy products that had just good online marketing? Yes, I purchased two information products like that, and I promised myself not to come close to those producers again. That gives me another lesson.

No matter how good your online marketing is, if you don’t have a decent product, you won’t have repeat customers.

If someone gives you marketing advice, please take it with a grain of salt, including this one of course. Ask yourself, how you came across your favorite writer, software, or whatever it is that you are producing. Then go ahead and emulate that.

In my case, one piece of content I came across by sheer luck was so good that I had to consume as much content as I could from those people. That makes my strategy to write the best blog posts I can and let the universe handle the rest.

The Linchpin of Any Online Marketing Strategy

You must have heard the story of the elephant and the four blind men. Four blind men touch different parts of an elephant and argue with each other what the elephant is like.

One of them likens it to a tree, the other one to a hose, yet another one to a sheet, and so on. It all depends on where they touch on.

In reality, the elephant has various body parts, and they all feel different. It doesn’t make sense to jump to a conclusion with partial data without having the big picture. Yet, we do it all the time.

Sure, there are times we have to move on without perfect information, but if you have a chance to access meaningful data, you better use it.

The Algorithm Change in Medium

With a recent algorithm change in Medium, I saw a sharp drop in the stats of my posts published there. This made me doubt the future of my blog.

Was I wasting my time blogging daily if Medium didn’t distribute my posts to readers? Was all the work for the last nine months for nothing? More important, should I stop blogging daily and move on?

Questions like the ones above floated around in my mind. I had decent arguments to stop blogging daily. I also had solid arguments to keep doing that.

Then, I checked the stats of my blog on my own domain. I realized that the traffic to my blog was fairly stable. Only 22% of the traffic came from Medium. 37% was coming from Google, and 31% was direct traffic. The remaining 10% was coming from the so-called long tail.

Those numbers were soothing. Probably, only a nerd would be soothed by numbers, but that’s what their effect was on me.

Sure, I’d like to keep that 22%, but if I couldn’t, it wasn’t the end of the world for my blog. 78% was still a decent chunk of my existing traffic. There was no reason to get discouraged. That’s why the ability to find out the truth is the most critical skill that you can develop in life.

What Social Media Does and Does Not Provide

Medium does a lot of things right. It gives the readers the ability to highlight and bookmark the posts they read. It gives the writers the stats about the views, reads, claps, and highlights. There is a community that exchanges comments.

My blog doesn’t have interactive features as Medium has, and I’m fine with that. If someone wants to bookmark a post of my mine, they can do so in their own browser or using their favorite social channel. If they want to highlight a section, they can clip the post and highlight it with Evernote.

My blog provides me with something crucial that Medium doesn’t. That is control.

Bloggers who didn’t bother to set up their blogs on their own domains and only published on Medium are in serious trouble after Medium changed their algorithm.

If I solely relied on Medium as a blogging and distribution platform, I’d lose 99% of the traffic to my posts. That would be a death sentence to my blog. There’s no way, I’d keep writing and publishing for only 1% of the traffic my posts used to receive.

Since I kept 78% of the traffic to my posts, I’m fine with continuing. Sure, I’d like to see that number grow and not shrink, but a 22% hit doesn’t kill my enthusiasm.

In a way, I’m grateful for that 22% hit. It’s a sobering event, but I can reframe that challenge as an opportunity to stop and look at my blogging practice. It makes me think about how to change my practice so that I can overcome that 22% hit and create further growth.

What Does Your Blog on Your Own Domain Provide?

With all the social media channels available to us, it’s easy to fall in love with a channel and to avoid starting and maintaining a blog on your own domain. After all, it’s a lot of work to do that. And who reads blogs on independent domains nowadays?

The reality is some people do. What’s more important? It’s a matter of time that your favorite platform will change their algorithms, ban you from publishing there, or go belly up altogether.

What are you going to do if any one of those events happen if you don’t have your own platform? You’ll lose all of your traffic overnight. That’s why a blog on your own domain is the linchpin of your online marketing strategy. It’s the little piece that holds everything together.

Summary

A blog on a domain that you control might look like a small, irrelevant piece of an online marketing strategy, but when your presence on other social media channels takes a hit, it’s usually your blog that survives that hit.

Distinguishing an Opportunity from a Distraction in Disguise

Yesterday, I received an excellent comment to one of my posts. The question is relevant to all of us but mostly to the first time entrepreneurs.

“Could you elaborate more on how following the opportunities that appear and following each of them is in line with not getting distracted?”

“As an example in the last 2 months there were many different opportunities I could have taken, but doing so would have lead to loss of focus and in the end most likely would have lead to not getting anywhere.”

by Kevin Raetz

This is a topic that I have addressed in the past, but it’s so important that I have to elaborate again, using the ideas that I published recently.

Before I dive into the topic, let me recap my last two posts so that you have a context for this post.

From an Idea to Reality

My previous post is based on two observations that I made over years.

  • We are more capable than we believe we are.
  • The universe is more abundant than we believe it is.

If we let go of our distractions and limiting beliefs, and focus on our goals by visualizing them, then we will become more sensitive to ideas and opportunities that will help us realize our vision.

Effortless Success

The post Effortless Success is a summary of the book The Surrender Experiment by Michael A. Singer. Singer was a college student who practiced mindfulness and yoga to quiet the chatter in his mind.

He merely followed the opportunities that appeared on his way and ended up as the founder and CEO of a billion-dollar software company.

Effortless Success is even more impressive than From an Idea to Reality because it shows that even our goals reflect our limiting beliefs.

Even our goals are a part of our limiting belief system.

If Singer had to come up with a set of goals when he was a college student, I’m sure he wouldn’t come up with the goal of becoming the CEO of a billion-dollar company.

We all have our worries and desires, and they limit us. We’re better off letting them go as explained in this post.

Mental Clarity

In both posts, I mention higher sensitivity to opportunities. When you have a clear mind, you recognize opportunities easier. They almost appear in front of you.

But how do you know an opportunity serves your goals, and it isn’t a distraction in disguise?

There are several answers to that question on different levels. Let me start with the intellectual level.

Resource Allocation

We, humans, are capable beings and the universe is abundant, but that doesn’t mean we have infinite resources.

Resource allocation is a critical part of your execution as an entrepreneur, even as a person. The scarcest resource is our time. Therefore, time management is crucial to all of us.

When you come across an opportunity, you have to ask yourself a question.

How does this opportunity fit into my big picture? How does it serve my vision, my long-term goals?

If it doesn’t, it’s obviously not an opportunity but a distraction in disguise.

If your vision is to become an entrepreneur, and you receive a better job offer, is that offer an opportunity or a distraction?

Sure, some jobs might lead to a business opportunity, but most don’t. This is something you have to evaluate and decide.

Low-Hanging Fruits vs. Lifetime Value

You might come across an opportunity that would provide you with quick cash. Does this opportunity serve your long-term vision? If not, it’s most probably a distraction. The only exception to that rule is that you actually need that cash to pay your basic needs.

Two months ago, I documented my usage of Steemit. I started to use it to evaluate it as an investment, but I quickly became addicted to it. After a month, I decided that it wasn’t worth investing my time or money, even though I started to make some quick cash using it.

Quitting Steemit was an easy decision. It didn’t serve my long-term writing goals. My lifetime vision was more valuable to me than the quick cash I’d make from Steemit.

The Challenge of Infinite Opportunities

As I have mentioned in a previous post, endless opportunities are indeed a challenge nowadays, especially for entrepreneurs.

The solution is similar to the low-hanging fruits. You need to have a crystal clear vision and evaluate whether an opportunity serves your vision or not.

If you look carefully, you’ll realize that most opportunities don’t serve your vision at all.

Experience

In some cases, it isn’t clear whether an opportunity serves your life goals or not. In those cases, you have to experiment.

At the beginning of my blogging journey, people would ask me whether I’d write a post for their publication or not. Back in the day, I’d accept those offers because the extra exposure seemed to be an opportunity to me.

After a few trials, I realized that those posts don’t bring any additional exposure at all. I’m better off investing that time in my regular posts in the Startup Publication.

In the last six months, I’ve written on a wide range of topics, writing, blogging, marketing, entrepreneurship, investing, cryptocurrencies, personal development, and life lessons.

My experience taught me to focus on personal development and life lessons. I wouldn’t be able to come to that conclusion if I didn’t experiment with all of those topics.

The 6 Months Rule

When you commit to an endeavor, stick to it for at least six months.

This is a rule I learned from the audio program The Ultimate Anti-Career Guide by Rick Jarrow.

I’d add another rule to the mix.

Don’t commit to more than two projects at a time.

Most of us have our day jobs. That’s already one big project. That means don’t commit to more than one side-project at a time. If you do, you’ll decrease your chances of success significantly on all of your commitments.

Pivoting

Quick and frequent pivoting is popular among startups. That’s obviously a violation of the 6 months rule. Do so only if you have a strong signal that your pivot will be a massive success.

I’d make another exception to the 6 months rule. If you’re just starting out, start 12 projects in 12 months. Try to complete each project within a month.

That would give you an enormous experience. And who knows one of those projects might end up becoming a home run.

After those 12 months, stick to the 6 months rule. Otherwise, you’ll risk ending up with an array of unfinished, failed projects.

Intuition

As you gain experience and let go of your internal and external distractions, you develop your intuition. When your intuition is at a high level, you don’t need to analyze on an intellectual level.

You instantly see what’s an opportunity and what’s a distraction. In other words, you reach the fourth level of learning, where you’re competent on an unconscious level.

That’s why cleaning up your mind as explained in the posts about effortless success and letting go is critical.

Conclusion

Even though some of us complain about lack of opportunities, an abundance of opportunities is a challenge for others.

Following every opportunity and trying to be everything to everyone produce mediocre results at best. To avoid that pitfall, we need to determine our vision first, and then evaluate each opportunity according to its contribution to our vision.

That requires some intellectual analysis and experience. Over time, we develop our intuition which helps us quickly evaluate opportunities.

Letting go of distractions, unnecessary thoughts, emotions, and habits also improve our intuition.

At a certain moment, we reach a point where we recognize opportunities instantly and reject distractions without thinking. That’s the state of the Zen mind where we operate in flow and succeed effortlessly.

The Zen of Entrepreneurship

David Hawkins, the author of Power vs. Force, mentions 17 levels in his map of consciousness.

  • Enlightenment
  • Peace
  • Joy
  • Love
  • Reason
  • Acceptance
  • Willingness
  • Neutrality
  • Courage
  • Pride
  • Anger
  • Desire
  • Fear
  • Grief (Sadness)
  • Apathy
  • Guilt
  • Shame

Map of Consciousness, a Useful Tool for High Performance

I find this map useful to regulate my emotional state for high performance.

I find emotions of shame, guilt, sadness, fear, desire, anger, joy, love, and peace useful for different purposes.

  • Peace and sadness are suitable to reflect on my life and make plans.
  • Joy is useful for long distance running.
  • Anger is useful for working out with weights in the gym.
  • Shame, guilt, fear, desire, and love are powerful motivators to execute my plans.

Peace vs. Apathy

Even though I read the book Power vs. Force years ago, there were still some open questions in my mind. I always wondered what the difference between peace and apathy was.

Apathy is the lack of intense emotions. So is peace. Then, what is the difference between them?

I think I’ve found the answer.

The GDPR Will Destroy Email Lists

Yesterday, I had a challenge. The new General Data Protection Regulation (GDPR) comes into effect starting from May 25, 2018.

This regulation affects my email newsletter as well. I have to collect explicit consent from my newsletter subscribers before that date. After that date, I have to delete the subscribers who didn’t provide explicit permission.

If you ever operated an email newsletter, you know what that means. I expect only 10% of my subscribers to complete that procedure. That means I’m going to lose 90% of my email newsletter subscribers in two weeks.

The GDPR Makes the Subscription Process Harder

It doesn’t end there. The new law requires me to have a checkbox in my subscription form. If a visitor doesn’t explicitly check that box, they won’t be able to subscribe to my email newsletter. I expect at least 50% of the visitors to overlook that box.

I know that you’ll suggest some hacks for that, such as loading the form with that box checked or making it a required field. Both practices are forbidden in the new regulation.

On May 25, 2018, I’ll lose 90% of my existing subscribers and 50% of my future subscribers.

The Most Productive Level of Consciousness

On which level of consciousness would you be if you were in my shoes? Anger? Fear? Grief? Apathy?

Surprisingly, I felt acceptance yesterday. There is nothing I can do against this law. Neither anger, nor fear, nor grief, nor apathy is a productive emotion at this moment.

The most productive emotional state at this moment is to accept what is, comply with it, and carry on.

My livelihood doesn’t depend on this list. But there are people whose livelihood depend on email lists. They are going to lose at least 90% of their income in two weeks.

The New Law Won’t Accomplish Anything Useful

You might defend the new law because there are so many spammers out there. I know that a lot of people add all the emails they could find to their lists. As a result, we all receive a bunch of irrelevant emails every day.

  • Will the new law prevent spammers from populating their lists with every email they come across?
  • Will it prevent auto-followers on social media?
  • Will it prevent bots from spamming the comment sections and contact forms of blogs?

It’s not going to happen.

The New Law Will Only Hurt Legitimate Businesses

This law will only reduce the revenues of honest people and businesses who comply with the law. That reduction in revenue won’t serve anything.

The revenue will be reduced because a prospect will overlook a checkbox in a sign-up form, not because they didn’t want to sign up to the email newsletter in the first place.

I always had a double opt-in mechanism in my email lists. I never added someone manually. I never sold people’s emails. I never sent irrelevant emails to my subscribers. Yet, I’m punished by this law.

Take It on the Chin and Carry On

Acceptance means to take it on the chin and to carry on. That’s exactly what I’m going to do in this case. Quitting is not an option at this moment. Neither is breaking the law. If my content is worth the attention of people, it’s going to find its way to their screens.

Now, I get the difference between peace and apathy. When you’re on the level of apathy, you don’t feel any intense emotions, and you give up. When you’re on the level of peace, you don’t feel any strong emotions, but you keep on going.

High Involvement, Low Attachment

The lower levels such as anger, fear, guilt, and shame are strong motivators to take action. But at a certain moment, you need to accept the reality and let go of your attachments to the results. There’s no way around this.

In a previous post, I called this attitude high involvement, low attachment. You take massive action and do your best without being attached to the results.

While taking action, anger, fear, and similar emotions are strong motivators. But once the work is over and you’re waiting for the results, you better get to the level of acceptance and peace, and don’t get attached to those results.

A Nontaxable Asset

At the end of the day, there is one asset that governments can’t forbid or tax. That is your knowledge and the lessons you learn. I owe that lesson to Warrant Buffet.

Sometimes a lesson learned is more valuable than 90% of your email list. Understanding the difference between apathy and peace was such a lesson for me yesterday.

How I Deal with Failure

In the last six weeks, I was focused on two numbers to measure the success of my blog. These are the weekly growth rates of my Medium following and the number of my email newsletter subscribers.

My weekly goal for both figures is 10%. That goal is at the ambitious side and I have a difficult time achieving it every week.

So far, my average was 7%. Not bad, but not being able to succeed my goal every week frustrates me a little. That’s why I want to look at other sides of my efforts than the weekly goals.

The Big Picture vs. Short Term Challenges

Online business expert Gary Vaynerchuk recommends to focus on “the clouds and dirt” and to avoid everything in between. The clouds is the long term vision. The dirt is the tasks and challenges in front of you.

In my case, the dirt is my weekly goals and how I want to achieve them. I’ve been focused on the dirt for the last six weeks. Today, I want to look at the clouds, the vision, the big picture of my efforts.

The Karmic Management Model

I’ll use the karmic management model of Michael Roach to analyze my blog. I discussed this model in detail in my post A Buddhist Monk’s Take on Business.

The Ideal and Less than Ideal Business

I make a distinction between ideal and less than ideal businesses. Ideal businesses add value to humanity. Less than ideal businesses extract value from the humanity.

Ideal businesses make a positive difference in the lives of other people. They provide value. That value has a financial equivalent. Ideal businesses receive a fraction of that value.

Less than ideal businesses extract value from the humanity. They do that by exploiting the weaknesses of people.

Most of us have their irrationalities. Some of those irrationalities are predictable. Less than ideal businesses build their business on exploiting those predictable irrationalities.

The World Is Not Black and White

Obviously, we can’t make a black and white distinction between ideal and less than ideal businesses. As I explained in my post the Fallacy of Extremism, that would be a childish outlook on life. Most businesses are somewhere between both polarities.

For example, gambling businesses provide some value by entertaining their customers. Educational businesses have to use some marketing techniques to convince their prospects to pay for their products and services.

In either case, I want to be closer to the ideal end of the spectrum.

Four Stakeholders in a Business

The karmic management model takes into account four parties to measure the potential of a business.

  1. Customers
  2. Employees
  3. Suppliers
  4. Humanity at large

I want to add a fifth party to this model: myself.

Customers

I plan to build an information marketing business around my blog. So far, I have been writing mainly about personal development and marketing.

Personal Development

I consumed a lot of personal development products and services. Those products and services made significant differences in my life. Some of those products and services were paid. There was an exchange of value both ways.

In some cases, I paid more than what the product or service was worth for. In some cases, I received great value for free. Some free YouTube channels and videos made significant, tangible, positive changes in my life.

In either case, I’m more than satisfied as a paying customer of the personal development industry. My own experience is a validation of the personal development business.

Marketing

In the past, I developed several products. Those products benefited their users, but I wasn’t able to commercialize them. Marketing and sales were the missing link between those products and their prospective users.

I’m not alone. A lot of gifted people have a difficult time building a business around their skills. They have a difficult time building products and services using their skills or commercializing the products and services they offer.

I want to create content that helps people build and commercialize products and services around their skills. But first, I have to figure that out myself. I work on it and I document everything that I learn on my journey.

I already receive the feedback that the lessons I share resonate with people. If you want to receive the latest lessons I discover on my journey, sign up to my weekly email newsletter.

Bottom line, I believe that there is value for my prospective customers in my information marketing business, both in personal development and marketing segments.

Employees

I don’t have any employees at the moment. There’s only one person who helps me with household once a week. I’m grateful for their services, because they save me a complete day every week.

As I build a business around my blog, I could hire freelancers such as virtual assistants, programmers, and writers.

Suppliers

My business would benefit several suppliers. I already pay for hardware, software, internet connection, and for some tools, such as Evernote and Google Drive.

I review the tools that I use in my blog posts. I believe that is fair value provided to my suppliers.

Humanity

I serve humanity by providing as much value as I can in the ideal side of business.

Myself

I enjoy blogging, writing, developing products and services on personal development and marketing.

Conclusion

Sometimes, we lose the big picture of our businesses by being too focused on day to day details. That was the case with my weekly goals.

Today, I wrote down my business vision using the karmic management principles. Now, I can clearly see the long term benefits of my business to its prospective customers, suppliers, employees, humanity at large, and myself.

All of that helps me put things in perspective and not get frustrated when I miss a weekly goal or two.

Don’t Sacrifice What Can’t Be Measured

Six weeks ago, I published a post about measuring the success of my blog and email newsletter with growth metrics. Since then, I’m obsessed with numbers and dived deep into my stats.

I published several posts about the lessons I learned from my stats. Here are some highlights.

These and many others helped me reach a bigger audience, express myself better, and get more responses. That’s why I say “data is gold if you know how to use it.”

Pitfalls of Using Data

Data is extremely useful, but it can also be extremely distracting. If I’d dive into Google Analytics, I could spend months on it without adding any value to my blog. That’s an obvious pitfall of using data.

There’s a less obvious pitfall. That is focusing on the numbers at the expense of what can’t be measured. That’s a subtle pitfall.

Make no mistake. I don’t downplay the importance of numbers. At the end of the day, we all have bills to pay and bills are paid by numbers. But focusing solely on numbers can backfire in the long term.

Focusing solely on numbers can backfire in the long term.

How I’m Deceived by Numbers

In a previous post, I argued that my about page wasn’t that important. It only accounted for 2% of the page views of my blog.

When I was writing my post the next day, I changed my mind. The about page might be critical. Its 2% page views might come from the most enthusiastic readers. By not having an up-to-date about page, I might be missing an opportunity.

What Can’t Be Measured Is Equally Important

Numbers are important, but what can’t be measured is equally important. On the one hand, we have quantitative analysis, and on the other hand qualitative analysis.

How can we measure the honesty of a blog post? Yet, honesty is a critical factor in the long term success of a blogger.

Short Term vs. Long Term

I think this all comes down to short term vs. long term. Numbers are great at optimizing short term results.

Sometimes, optimizing short term results is also good for optimizing long term results, but not always.

If short term and long term goals contradict with each other, I prefer long term goals.

Most of the time, there’s greater value in the long term.

As I explained in my post, Quick Cash vs. Long Term Value, I made zero dollars from my blog so far. I experimented a few weeks with Steemit and already started to make money on that platform.

If I looked at the numbers, working on Steemit seemed to be better than working on my blog.

After a few weeks, I quit Steemit in order to focus on my blog. Steemit didn’t seem to be a sustainable business model. The lifetime potential of my blog seemed to be greater than the potential of Steemit.

If I needed some cash in the short term, I’d keep working on Steemit. I don’t. That’s why I skipped the quick cash.

Quick cash is more expensive in the long term.

The Right Tools for the Right Goals

It’s important to use the right tools for the right goals. Some tools are more suitable to optimize qualitative goals. Others are more suitable to optimize quantitative goals.

Two weeks ago, I published a post about commenting on Medium. In that post, I argue that commenting on Medium doesn’t boost one’s number of followers. I received a lot of responses to that post. My readers argued about the benefits of commenting.

I agree that commenting has a lot of benefits.

  • It builds relationships with other readers and writers.
  • You develop new ideas with others.
  • You receive answers to your questions.
  • You come up with new topics to write about.

All of those benefits are qualitative benefits. If you use commenting for its qualitative benefits, you’re going to act different than if you use it for its quantitative benefits.

Commenting for Qualitative Benefits

If you comment for its qualitative benefits, you’ll take your time to understand the post, and you’ll comment to add something to the discussion, including asking a question.

If you comment for its quantitative benefits, you’ll read a few paragraphs of a post, quickly jot down a few sentences, and repeat that for dozens of posts every day.

Guess which one would be more effective?

Quantitative Goals Might Not Match the Nature of Reality

“Life is what happens to you while you’re busy making other plans.” John Lennon

Another pitfall of using statistics is that we make linear plans. My weekly 10% growth goal is a typical example of this. Most of the time, life doesn’t work like that. Growth comes in spikes after long periods of plateaus (Fig.1).

Fig. 1. Linear Growth vs Quantum Leaps

As I have written in a previous post, it took me 55 blog posts to get published in the Startup Publication. 17 of those posts have 0 views to this date, 12 only 1, and 7 only 2.

Conclusion

You can measure some factors, but you can’t measure others.  If you can’t measure a factor, that doesn’t mean it’s an unimportant one.

Honesty, relationships, and karma can’t be measured. Yet, they play a critical role in success.

Karma is unmeasurable.

Take into account quantitative analysis to optimize your business, but not at the expense of qualitative analysis.

Will the Startup Bubble Burst?

When someone talks negatively about an innovative idea like startups or cryptocurrencies, I get triggered. I know I have to be rational and let those intense emotions go, but sometimes, it’s difficult. In such cases, I use those emotions as fuel for creativity and write a blog post about them.

Who Are the Critics of Startups and Cryptocurrencies?

When someone talks negatively about an innovative idea, there are usually one or two things going on. They either missed the idea or the idea disrupts their business.

You might have heard some famous investors and bankers badmouthing cryptocurrencies. Why do they do that? Most of the time, it’s one of the following.

  • They missed the uptrend entirely.
  • Cryptocurrencies pose a threat to their businesses.

I have yet to come across a reasonable argument against cryptocurrencies from these otherwise brilliant people. To me, their comments don’t sound authentic, but they sound like having a hidden agenda.

Successful investors or bankers are savvy enough to not badmouth the startup idea in general. Startups are generally badmouthed by people who feel like they can’t participate in them, neither as investors nor as founders.

Investing in a Startup

I understand when someone thinks that participating in a startup is not for them. Investing in a startup feels like that’s the last time you have seen your money. The chances of seeing your money back is really low, but if the startup takes off, the returns are unsurpassed.

Investing in a startup isn’t for everyone. Or let’s say it wasn’t for everyone. Cryptocurrencies lowered the barriers to entry to this space. Nowadays, you don’t need to invest a minimum of $100K USD in a startup. You can invest as little as $100 USD in the cryptocurrency of a startup.

I can afford to lose $100 USD, but I can’t afford to lose $100K USD. So, I couldn’t invest in a startup in the past, but now, I can. I bought some Steem Power which is the cryptocurrency of the social platform Steemit.com.

I’m not a big fan of Steemit.com as I have written in a post before. However, you never know how things will evolve in the future. I invested an amount that I can afford to lose entirely. I just marked a date three years later in my calendar. I don’t have any expectations from that investment, at least for the next three years.

This is how investing in startups looks like in general. People invest an amount they can lose entirely and they are ready to wait for three to seven years before they see any returns to their investment.

I get that this type of investing is not for everybody, but why badmouth it just because it’s not for you. There are other people who can benefit from this type of investment. They take the risk and some of them get the rewards.

Is There a Startup Bubble?

Here’s another negative opinion about startups. “The startup space is in a bubble.” The question isn’t whether the startups are in a bubble or not. The question is “is there an investment vehicle that isn’t in a bubble?”

There is excess cash in the market and people are looking for investments that bring in higher returns than the 0% their savings accounts bring.

That excess cash flows into the stock market, cryptocurrencies, and to startups. If you take into account the official 2% inflation policy in fiat currencies, I don’t see anything wrong with that.

Sure, at a certain moment, we could see crashes in the stock market and/or cryptocurrencies. As a result, startups would suffer from that crash as well. However, that doesn’t mean that it’s bad that investments are flowing to the startup space.

If you think that there’s a startup bubble and that’s a bad thing, stop using Facebook, Twitter, Amazon, and every other Internet based product or service. Most of them were built during the Dot-Com Bubble and benefited from those investments. As I have written in a previous post, bubbles are good for technological progress.

Founding a Startup Is Not For Everyone

I get that you can’t found or work in a startup. It’s a lot of hard work. It’s a lot of stress. There’s no job security. Wages are low compared to established corporations. As a result, this career path isn’t for everyone. It favors either the young and single or already well-off people.

Middle class family people need their jobs to have a solid income and to have some downtime to take care of their families. That doesn’t match well with startups. I get that startups aren’t for everyone. And that’s fine. But please don’t badmouth startups. Let the people who can afford to work on them in peace.

Conclusion

Investing in or working on a startup is not for everyone. Neither does it have to be. Startups benefit the society by providing technological progress.

From time to time, there are bubbles in startups, just like the rest of the economy. Startups and as a result the whole society benefit from those bubbles.

Investing in or working on a startup might not be the right move for you, but please be authentic about this fact and don’t badmouth startups.

Disclosure and Disclaimer

At the moment of writing this post, I owned Bitcoin, Steem Power, and S&P 500 Index Funds. This post is for information purposes only and not intended to be business or investment advice.

How to Deal with the Challenge of Infinite Possibilities when Starting a Business

When you first start a business, there are countless products you can develop. There are countless services you can provide. You can come up with countless product-service combinations.

When you decide on a product, service, or product-service combination, there are countless ways of implementing it. There are numerous platforms, tools, and channels you can use to develop and promote your business.

There are various niches, segments, and audiences you can target. As a result, you have virtually infinite possibilities when you start a business. This might sound like good news, but it has many disadvantages in reality.

Three Disadvantages of Having Infinite Possibilities

First, you might have a difficult time making decisions. You might wonder which product, service, or product-service combination is the best one. You might wonder who your target market is.

You might wonder which tools and platforms you are going to use to develop your business. You might wonder which channels you are going to use to promote your business. As a result, you might end up being paralyzed and not start your business at all.

Second, you might start a business, but you might jump from product to product, service to service, niche to niche, audience to audience, segment to segment, channel to channel, and platform to platform. As a result, you might end up with no results with any of them.

Third, you might look at the infinite possibilities at your disposal, project them to your potential, come up with all kinds of vague goals, and get depressed when you find yourself nowhere near those goals.

If you find yourself in any of those three conditions, this post is written for you. Read it carefully, apply the principles in your business and life, and you will overcome the challenges posed by the infinite possibilities.

This process might not be as fun as jumping from product to product, niche to niche, platform to platform, but it will provide you with a solid framework to make progress toward your goals.

Crystal Clear Goals

The first step is to define a long term goal. What is your long term goal? What do you want to achieve at the end of the next three years or more? Maybe you have a goal that you can achieve in the next three years, five years, ten years, or more. That’s all good.

The catch here is to have a crystal clear goal that any third party could verify.

In order to do that you need two components, a date and another number or numbers.

By when are you going to realize this goal? Three years? Five years? Ten years? More? Just set a deadline for your goal. If you are going to achieve your goal in three years, then your deadline from now is April 2, 2021.

The second component is to attach a number or numbers to your goals. “I want to achieve financial independence by April 2, 2021” is not clear enough.

What does financial independence mean for you? How does it translate to numbers? Does that mean $2M USD in savings? Does that mean $100K USD in annual passive income? How do you define passive income? Do you define it as a four hour working week? Or do you define it as a two hour working day?

You need to define your goals so clear that when another person observes your reality, they could say whether you have achieved your goal or not without a single doubt.

Here’s an example: “I will have a $2M USD in savings, $100K USD in annual income, with 10 hour working weeks, and four weeks annual vacation, by April 2, 2021.” Anyone who looks at that goal and to your life on April 2, 2021 would testify whether you have reached your goal or not. There’s no room for doubt.

Reverse Engineer Your Goals

The second step is to start from that goal and come back in time. What do you need to achieve before that goal, so that you can achieve that long term goal? I explained this process in detail in my post about reverse engineering and scientific method. Don’t worry, it’s not as complicated as it sounds.

Here’s an example: my midterm goal is to have a 100K Medium followers and 20K email newsletter subscribers by July 1, 2019 (15 months). Anyone who looks at my Medium profile or newsletter stats on July 1, 2019 could verify whether I have reached that goal or not. There’s no room for doubt or confusion.

Weekly Goals

Here comes to important part. How does all of that translate to weekly goals? Which goals do you need to achieve by the end of this week to achieve your midterm and long term goals?

In my case, I need to grow my Medium following and newsletter subscriber list by 10% by the end of this week. As I have written in a previous post, the best way to make progress with your startup is to work toward weekly growth goals.

I need to achieve my 10% growth goal every week for the next 15 months to reach my midterm goal. Again, my weekly goal is a crystal clear goal that can be verified by any person who looks at my Medium profile and newsletter stats.

Break It Down As Much As You Want

If three steps are too few for you, you can add more steps in between. You can have a life goal, a decade goal, a five years goal, a three years goal, a year goal, a semester goal, a quarter goal, and a month goal or goals.

There’s nothing wrong with breaking down your goals, but at the end, you need to translate all of that to crystal clear weekly goals and daily action lists.

Daily Action Lists

Your weekly goals are slightly out of your control. For example, I can’t login to the emails of other people and subscribe to my email newsletter or follow myself on Medium. That’s out of my control. However, my daily action list is 100% under my control.

Here’s my daily action list.

  • Publish a blog post
  • Answer emails, Medium responses, blog comments, and tweets.

Weekly Evaluations

On top of my daily action list, I evaluate my weekly results and determine a list of extra actions to take in that week. Here are a few questions I ask myself every week. I believe in asking the right questions achieve goals and to succeed.

  • Did I reach my goal this week?
  • If yes, why?
  • What contributed to my success this week? Do more of this.
  • If not, why not?
  • What prevented me from success this week? Eliminate these.
  • What can I do this week to succeed at the next week’s goal?

How to Clarify Vague Action Lists?

When I go over these questions, I come up with a specific action list for that week. Those action steps are specific. That means any person looking at my work can testify whether I have completed them or not.

If I come up with a vague action step, I translate it to something exact. Let’s say, my action step is “to improve my landing page.” That could mean different things to different people.

If an action step is vague, I ask follow up questions to clarify it. “How can I improve my landing page?” Then, I come up with several answers to those questions.

  • Remove the distracting links from the landing page.
  • Add a few sentences about the no spam and one-click unsubscribe policy.
  • …

Focus, Consistency, Clarity, Motivation, and Accountability

Having crystal clear long term, midterm, and weekly goals and working from a crystal clear daily action lists prevent me from getting lost in infinite possibilities.

At any given moment, I’m crystal clear about my goals and action lists. There’s no confusion. There are no doubts.

Moreover, my weekly goals motivate me to the level of obsession, because that goal is right in front of me. It’s exciting. It’s just around the corner, but still out of my control.

If you add to the mix a mastermind group, I not only get excited about reaching a goal, but I also get excited about having to report to my group.

If you take into account that I don’t have infinite resources, I can’t jump from product to product, niche to niche, or platform to platform, to achieve my weekly goals. One week isn’t that long of a time to experiment with dozens of ideas.

If I have to experiment with a different idea, then I choose one of them and experiment with it in that week. The focus is on getting results, not on jumping from idea to idea.

Conclusion

Having infinite possibilities when starting a business can be a challenge for first time starters. You might wonder which option to choose to start with. You might jump from option to option. Or you might be discouraged by your results when you look at all the options at your disposal.

If you want to deal with all of those challenges, don’t look at all the possibilities at your disposal. Shift your focus from possibilities to crystal clear goals. Clarify your goals by adding deadlines and exact numbers to them.

Reverse engineer your goals from long term goals to weekly goals and daily actions list. Focus on your weekly goals and daily actions lists and you will make progress like you have never made before. On top of that, you won’t be bothered by the challenges of infinite possibilities anymore.

How to Use Reverse Engineering and the Scientific Method to Realize Medium.com’s Business Goals

Reverse engineering and the scientific method are two useful methods to achieve private and professional goals, especially when used in combination with each other. In this post, I’m going to apply this idea to the business goal of Medium.com.

The first step is to define the objective. I’m going to define the objective of Medium.com is to maximize the revenue from premium memberships. This might or might not be their objective. It’s just an assumption I make to demonstrate the idea.

Now, we are going to start from that objective and come backwards step by step. Let’s formulate our challenge as a question and look for answers to the question. Remember, asking the right questions is the first step to success.

What is needed to maximize the revenue from premium memberships?

  • Maximize new subscriptions.
  • Maximize the retention of existing subscribers.

At this moment, we have two branches that we have to work on. Let’s start with the first branch.

What is needed to maximize the new subscriptions?

  • We have to maximize the traffic of Medium.com.
  • We have to maximize the user engagement.
  • We have to create curiosity about the premium content among the existing users.
  • We need an optimal landing page design of the premium content for maximum conversions.

Now, we have four branches for the first branch. Again, we need to work on each branch separately. Let’s work on the second branch.

How can we maximize the user engagement?

  • Feature quality content on the homepage.
  • Feature quality content at the end of the posts.
  • Feature content that keeps the user in Medium.com.
  • Optimize the page design to keep the user in Medium.com.

Let’s continue with the first branch.

How can we feature quality content on the homepage?

  • Hire editors.
  • Feature the most popular posts on the homepage.
  • Create a relevance score between each user and each post. Feature the most relevant posts to each user.

At this moment, I need to test which option would produce the best results. I will divide the user base into three groups and test each hypothesis.

The Metric for User Engagement

The first step to that experiment is to define how I’m going to measure the engagement. In order to do that, I’m going to measure four variables: views, reads, fans, and responses. Before composing my metric, I’ll look into the data to see the number of reads, fans, and responses for each view.

Let’s say, the average user reads the 50%, claps for the 25%, and responds to 10% of the posts they view. In that case, I’ll construct the engagement metric as (#Views + 2 * #Reads + 4 * #Fans + 10 * #Responses). With those weights, I balance each variable based on their importance.

I’ll measure the engagement metric for each group above and see if one group significantly outperforms the other.

A Relevance Score between each User and Post

Featuring the most popular posts on the homepage is a straightforward method. Hiring editors and coming up with a relevance score is rather complicated. Let’s work on the relevance score in this post.

Which variables can we use to create a relevance score?

  • Authors of the posts that the user had a high engagement score before.
  • High engagement scores by other users that follow a similar set of tags as the user.
  • High engagement scores by other users that had high engagement scores on the posts where the user had a high engagement score.

To start with, I could use the same weight for each variable, but eventually, this could be optimized as well.

Processing the Results

Now, all I have to do is to run this experiment for a month and look at the results. Are there significant differences between the results? My hunch is that the second option, featuring the most popular posts on the homepage, would perform the worst.

I think the third option, having a relevance score, would perform the best. Once we find the best performing option, we can continue our experiments.

Once I find the best performing option, I’d serve the best performing option to 90% of the users. I’d try to come up with another option each month and serve the choices of that option to the remaining 10% of the users.

Here, you have to use your creativity to come up with other options. Remember, creativity is finding new relationships in already existing concepts. Then, all you have to do is to test those new options on the 10% of your user base.

Here’s an example. I’d come up with a relevance score between the editors and users. I’d then use that signal in the relevance score between the posts and users. If an editor and a user has a high relevance score, the posts that are selected by that editor will have a high relevance score to that user.

The Big Picture

At this moment, we have a method to create high user engagement, but don’t forget that user engagement is one of the many branches in our tree. There are many other branches we have to work on. So, we need to apply the same reasoning and experiments to the other branches of the tree as well.

Conclusion

We can use the combination of reverse engineering and the scientific method to achieve our private and professional goals. The first step is define a clear objective.

Once we have a clear objective, we will use the questioning process until we have several options that we can act upon immediately. Once we have those options, we can use the scientific method to find the most effective option.

Finding the most effective option is not the end of the work, because we can use our creativity to come up with other options and test them against the best option that we came up with so far.

However, we shouldn’t lose the sight of the big picture and get lost in the details. Usually a business goal can be divided in a tree that consists of multiple branches. We need to optimize each branch of the tree to reach our goal.

How to Build a Business Empire by Connecting the Dots

There’s a common belief that you have to come up with an original idea or invent something new to start a business. Most of us also believe that creativity is creating something out of nothing. Both beliefs are inaccurate and they are keeping us from being creative and starting a business.

As I have explained in a previous post, creativity isn’t creating something out of nothing. Creativity is connecting existing ideas and concepts in a new way. You don’t need to come up with an original idea or invent something new to start a profitable business.

You can use your creativity to market existing products and services to new target groups for different purposes. You can combine existing products and services to come up with new products and services. Steve Jobs and Apple applied this principle and built an $800B+ business empire.

How Did Steve Jobs and Apple Succeed?

Apple successfully targeted general public with their computers, smartphones, and tablets. Before Apple, those products were mostly marketed to businesses.

Apple made those products easier to use for the average consumer. Steve Jobs played a critical role in making Apple’s products easy to use.

I think Steve Jobs could understand the average consumer better than others, because he didn’t have a formal engineering degree. In a way his lack of an engineering degree was critical to the success of Apple.

Improve Already Existing Products or Services

iPod played a critical role in Apple’s success. Before the mp3 players, people used portable cassette and CD players. Those devices could play one album at a time. It was relatively easy to access the album or song you wanted to listen to.

With the mp3 players, you had hundreds of albums and thousands of songs in a device. It was hard to access the album or song you wanted to listen to. Apple and Steve Jobs solved that problem brilliantly with iPod. As a result, they got a huge commercial success with iPod.

Existing Products and Services Marketed to New Consumer Segments

iPod paved the way to iPhone and iPad as a commercially successful mobile device. I think Steve Jobs saw the success of a mobile device with the general public and asked himself the question below. Remember, formulating your challenge as a question is the first step to success.

How can I make a smartphone appeal to the general public?

The answer to that question might be obvious now, but the standard smartphone was much different back then.

The most popular smartphone was BlackBerry. Its screen was only half the size of the device. The remaining half was covered by a physical keyboard. The typical user of a BlackBerry was a business professional. Its main use was business communication.

With iPhone, Apple targeted a new consumer segment for smartphones, general public instead of business professionals. They also defined a new purpose for smartphones, entertainment instead of business communication.

In order to do that, they got rid of the physical keyboard and used a large screen. They developed an operating system that could take advantage of the new setting. They also used a touch screen to avoid the stylus. Once iPhone became a success, iPad was the logical successor.

Conclusion

As Apple and Steve Jobs demonstrated, you don’t need to be a genius inventor to build a business empire. You can combine existing ideas to create new products or services.

You can target new consumer segments with existing products or services. In order to find the solutions to those challenges, formulate your challenges as questions and use your curiosity to find the answers to those questions.