What are you Worth?

Charge more for what you do.

That’s what this post is about, giving you the ammunition to charge more and feel like a badass.  

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“I bargained with Life for a penny,
And Life would pay no more, 
However I begged at evening
When I counted my scanty store;

For Life is just an employer,
He gives you what you ask,
But once you have set the wages,
Why, you must bear the task.

I worked for a menial’s hire,
Only to learn, dismayed,
That any wage I had asked of Life,
Life would have paid.”

-Jessie B. Rittenhour

If, after reading this post, you are unable to charge more for what you do, fear not. Just come back to it the next time you are feeling underpaid and try to let the ideas sink in a little deeper.

Also, remember rule number 1 of personal change…

Rule #1 – Don’t give up unless you’re dead. 

First, here is why most early stage entrepreneurs don’t charge enough for what they do:

Reason 1 why you aren’t charging enough:  You’re still thinking like an employee, not a business owner. 

Even if you never have employees and only operate this thing yourself, you need to start treating your career as an independent as though you are a business of one. Which means you have to stop thinking about your time in terms of employee time. When you become an employee of an organization, you essentially “sell” your entire working time to that company. You’re essentially giving them a volume discount for

When you become an employee of an organization, you essentially “sell” your entire working time to that company. You’re essentially giving them a volume discount for guaranteeing that you will get paid. You’re also giving them the burden of finding you work to do.

When you are out on your own, you have no guarantees. There is now time spent doing the following activities that must be built into your pricing: 

  • Getting to and from gigs.
  • Finding gigs (this is the one people don’t account for enough)
  • Billing for gigs
  • Chasing money (invoicing, collections, etc…)

So you naturally have to charge more.

Reason 2 why you aren’t charging enough:  You’re worried they won’t give you the work if you aren’t the right price. 

How many times have you asked someone what it cost only to find out you can’t afford it? I’m sure it has happened to you. And it will happen again. It happens to ALL of us and it’s no big deal.

Yet, when you are just starting out and every deal could make or break you, it’s really easy to think that you should come down on pricing. Don’t! It will work out, stay strong.

Reason 3 why you aren’t charging enough:  You associate pricing with self-worth. 

Pricing is all about value. It has nothing to do with “worth”. You are worth a lot more than some money paid out to you by the hour. The money you are paid has nothing to do with your worth. You are worth much more than you think anyway. But the money is completely separate. Money is aimed directly at the value you provide. So don’t be afraid to charge what is fair and makes you a profit.

That’s all I got. Good luck!

Money

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Whenever I have needed money as an entrepreneur, a simple formula has always gotten me out of jams. 

First, I will tell you what I don’t do.

If you’re with me after that, I’ll tell you what you should actually do. If you aren’t reading this, then you may read my first list and think it’s the list of what you should do. That’s understandable because it’s a common list of what most people do, including myself when I was inexperienced. I only stopped because it didn’t work, not because it didn’t feel right. I hope you eventually come back because the first rule of making money when you have none is paying attention.

Don’t: 

  • Focus on money
  • Work hard to find new people to sell your product or service
  • Pay your bills more slowly to conserve cash
  • Incentivize prospects on the fence to sign and pay by offering discounts
  • Immediately change your business model and product offering to try and capture new markets that you are missing.

Why? What evidence do I have not to do this stuff?

Here’s a story.

Once, I had just a few hundred dollars of cash left in my business with a 5 figure payroll coming up. Clearly, this is one of those panic spots when you wish you could run out and force someone to sign with you.

The list you see above is essentially what I did to fix my problem. I started getting desperate to get a prospect to sign that had been on the fence. I gave them discounts. I called them a bunch. I thought about their money constantly and how it could solve my problems. What happened was I took a project I should have never taken. The timeline was too short. The money was too low. But I did it. I felt like I had to take it.

We did our best to serve the customer after we got them, but something wasn’t right. I’ve learned if they meet you desperate, they treat you desperate. First impressions set the tone for a relationship.

It ended up costing me much more in the long run in issues than drawing my line of credit and focusing on serving my customers would have.

So what do you do instead?

When you need money, do the following:

Do: 

  • Focus on service and pay attention to every little detail of what’s going on
  • Make a list of every customer (put NAMES, not just companies, but PEOPLE who need you), now make a list of their needs, desires, strengths, weaknesses, and things you can do to address them. Now set about helping them above and beyond what you are paid.
  • Pay your bills faster than normal. It will feel hellish because you are paying out the money you need to live on.
  • Become more strict on prospect qualification and be very very wary of providing any kind of discount and if anything, use this opportunity to raise prices.
  • Double down on your most profitable customers and try to learn more about what they are doing and what they need.

Why? Another story. 

After I read Emerson’s law of compensation (PDF), I set out to apply it to my business. For those curious, it basically states “If you want more, give more [sic].”

So, I tried it. I started doing more for customers. We started sending update emails when they didn’t ask. Going to their offices and dropping off donuts. Instructing my people to take more blame when things didn’t go right.

I wouldn’t say I stopped looking for new customers completely, but it became a much smaller part of my day.

And what happened? Our business doubled over a period of 6 months. Was I worried about money? Nope. People were flinging money in our faces.

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So, when you need money, buckle down. Don’t look for quick fixes. Do the right thing and look hard at yourself and your services and products and try to make them better. Take any people you are currently working with and make it your mission in life to serve them better.

Be patient. You don’t want to solve this problem quickly. Otherwise, it’s going to come back and bring more problems with it. 

 

 

The Jump

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There comes a point in every entrepreneur’s life when they must jump.

This post is about that wonderful, terrifying, pants-shitting moment that we all must face when going out on our own.

It was June 15th and I had only 2 weeks until I would be completely on my own. 

I had known the date for about 90 days. I had set it as a goal and I had already told my employer, so it was official. It was happening, there was no way around it. I would be on my own without any income for the first time in my adult life. At the time, I was about 7 years into my career.

I had a little money saved up, but not much. Maybe enough to live for a month. I had some credit cards with maybe another month’s worth of living on them. I had no prior experience as an entrepreneur. No formal training in business or anything like that.

“No formal training in business or anything like that.”

There were no gigs lined up. No safe landing. 

The only thing I was confident of, was my skill. That, and my ability to change my habits. Something I’ve come to find out is possible for everyone. I used to think it was my super power.

The first thing I did was the numbers. Over and over I looked at what I had and what I was spending. I shaved everything down to the nub. I stopped going out drinking. Stopped going out to eat. I was on a mission. All I needed was time.

I got a roommate in my 2 bedroom house with one bathroom to reduce my expenses to the bone. 

I sold my bikes, my surfboards, my extra electronics and anything else I could find.

The only thing I purchased, was a top of the line computer.

My logic being that I needed good tools. I could get rid of shit, but I couldn’t work on shit. And since my employer owned my laptop, I had to buy a new one that was my own.

I didn’t read any books about business or how to start one. Whenever I did, it looked like a lot of work before you could even start doing anything for anyone.

“I didn’t read any books about business or how to start one…”

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Once I calculated that I could live like this for about 60 days, I set to the work finding work.

NOTE: I never stopped the work of finding work. And neither will you. Even if you build products. You will learn this is the actual work of working for yourself. Finding work for yourself people will pay for. AKA, sales. 

I did what anyone would do in my situation. I called the people I knew who were already business owners. I reasoned that they were small businesses, so likely they would need some help and would be more willing to take a chance on a one-man band than an established company.

At this point, I didn’t really have an “idea” per se.

I mean, I knew that I wanted to work in technology and I knew I liked e-commerce, but I didn’t really know in what capacity I wanted to help.

So, that’s my story.

That’s how I jumped.

Eventually (about 30 days in), I got my first gig. Hourly projects for local small software companies helping them with tech problems. Somehow (5 years later), it’s become real businesses, employees, etc…

So… What’s stopping you? 

Time? 

Money? 

Fear? 

I could sit here and tell you that you need to address each of these, but you know that. And honestly, the problem is that you can address them until the cows come home and there will NEVER be a right time!

“there will NEVER be a right time”

SO JUST FREAKING DO IT!

IT’S OK IF YOU FAIL!

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Do you want to be wishing you had for the rest of your life?

 

 

 

 

 

Working With Others

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So you got the nerve, you started a business, you got out there and started talking to people, and then…

Someone actually wants to work with you!

Unlike what most people think, it’s actually extremely likely, if you keep asking, that someone is going to say yes to you. There’s just so many people and opportunities out there, it’s more surprising if nobody does

So, what do you do?

In this post, I want to highlight the principle that can guide you to successful business partnerships.

But why do I mention partnerships when we started out talking about people saying yes? 

Because, from experience, when you are first starting out, a lot of opportunities will be partnerships, not just customer relationships.

Why? 

The main reason is that at the point that you first start, you are just one person (or a few) and your resources will be limited.

So you may need other companies, people, or contractors to help you get off the ground (it’s a hell of a lot easier). 

Using the principle outlined here, you can hopefully create any number of creative possibilities for how you can work with others.

So here are the ground rules:

  1. Always know EXACTLY what they want to get out of the situation.
  2. Always know EXACTLY what you want to get out of the situation.
  3. Make sure each other know #1 and #2.
  4. Go for a mutual win. Trying to win over them is just going to invite the inverse.
  5. Have this agreement in writing before you start or as soon as possible.

And the most important part?

KNOW HOW IT ENDS.

If it’s going to end, you should know how before you start.

That’s it, now get going and work with people. Because the key to working for yourself… is working with and for a whole lot of other people.