Author Archives: Jason

Napoleon

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One of the books I finished not long ago was Napoleon by Andrew Roberts.

I like to read biographies of famous/successful people in order to learn what they did to become so successful so that I might copy what they did and emulate their success.

Napoleon, like many “great” men, seems to have been a professional success (until his decline) but somewhat of a failure in his personal life. He cheated on his wives and didn’t seem to be a very good dad.

I did have at least one good takeaway lesson from the book. Napoleon had a number of “military maxims” as I remember it, and one of them stated that you should concentrate all your forces in one place instead of dividing them. I think this is a good rule. Once in a while I remember a certain friend of mine who has something like three different businesses. Last I heard, not one of those three businesses was successful. It would probably be better just to focus on one business and make that one successful.

I have two businesses by necessity. One, Ben Franklin Labs, provides income now but can’t provide long-term wealth. The other, Snip, can provide long-term wealth but doesn’t yet have much income. I don’t want to make things any more complicated than this. I often have ideas for other businesses or projects, and in fact I’ve worked on other projects in addition to BFL and Snip, but it’s probably not a good idea.

I can also think of how the “concentrate your forces” rule could apply inside a single business. There have been times in the past when I’ve spun up a Google AdWords campaign on Snip, only to get cold feet and pause the campaign shortly after starting it, truncating any positive effect it might have had. I’ve also had stretches of time where I would dabble in several different areas of Snip – coding on the product, tweaking the website, interviewing industry influencers, etc. – rather than focusing on just one area at a time. Focusing on just one area at a time is probably best. Thanks, Napoleon.

Weekly Snip Report, May 13th, 2015

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A few new things. I’ve gotten some more stuff back from my designer for the marketing site redesign and it’s looking good. I have to wait until I get the final deliverables in order to actually code the new design into the site.

I also got impatient and started an AdWords campaign a few days ago even though the new site isn’t ready yet. Since 5/9 I’ve had 5 clicks. My average CPC is $10.53 and my CTR is 0.44%. I’d like to get the CTR above 1%, and of course I’d like the CPC to be as low as possible. I’m estimating that I’m going to need one new customer for every $2000 I spend. Right now I have AdWords set to a $500/mo budget.

In addition to AdWords I also engaged with this company called Capterra. If you google for “salon software” or “hair salon software”, the first result is this Capterra’s salon software directory. I had long wondered what exactly it would take to get to the top of Capterra’s listings. I assumed it of course involved giving them money. It turns out they offer a PPC thing to their customers. The minimum bid is $2.00/click. I was told I could leap over a number of my competitors by bumping it up to $2.25, so I did that. I’ve had that going for a couple days and I’ve gotten 8 clicks each day. I’ll be curious to see how Capterra performs compared to AdWords. My plan is to run them in parallel for about a month and then see what I think. I’ll probably dial AdWords back to $250/mo and set Capterra to $250 as well because I kind of decided I just wanted to spend $500/mo on marketing at first.

Weekly Snip Report, May 6th, 2015

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I’ve been continuing to focus on earning money consulting. That’s going well.

The designer I hired to redesign the website showed me some material last weekend. I understand I’ll be receiving the rest this coming weekend.

Weekly Snip Update, Friday, April 17th, 2015

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The prospective client engagement I mentioned last week has become a reality. I started on Tuesday.

I don’t remember if I had made this decision as of last week but I’ve decided now that the way I’ll move Snip forward over the next six months will be to spend my time earning as much money as possible, then putting a portion of that money toward Snip. First comes the website, then AdWords, then who knows what. My hope and expectation is that I can put together a funnel using just AdWords that will get me a few more customers. I don’t even care much at this point if I have to lose money on each customer, I just want a bigger customer base to get some momentum going.

So my next several updates might not be terribly interesting.

The E-Myth Revisited

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I read kind of a lot of books. I thought it might be a good idea to jot down some thoughts on each book I’ve read to a) help crystalize any knowledge I might have absorbed from the book and b) share the book and some of its knowledge with the people who read my blog. (Yes, to my continued astonishment, there are people who actually read this blog.)

Today I finished The E-Myth Revisited by Michael Gerber. I listeded to the audio version on Audible, which I’m glad I did, because it was read heartfully by the author. I don’t say this too often but this book was a mind-blower and a life-changer for me. I’ll explain why.

I’ll start by explaining what “The E-Myth” is. The E-Myth, as I understand it, is that small businesses are started by entrepreneurs. The truth is that small businesses are started not by entrepreneurs but by “technicians experiencing an entrepreneurial seizure”. Instead of creating a business for himself, the technician creates a job, often a shitty job. I found this insight interesting because I’m a technician and I’ve created a job for myself. I’m mostly doing the technical work of a software engineer rather than the work of an entrepreneur.

Michael Gerber contrasted this job-masquerading-as-a-business picture with that of McDonald’s which apparently calls itself “the most successful small business in the world”. The product McDonald’s sells is not hamburgers and french fries but the unique way it has developed of operating its stores. Because McDonald’s has a system that’s been proven to predictably produce the right results, McDonald’s stores can be operated by teenagers with no work experience.

The author’s suggestion is to apply the franchise model to your small business. He doesn’t mean to literally turn it into a franchise. He just means to turn your business into a prototype of a franchise with a documented system describing how it works. Instead of thinking of yourself as someone who works in the business, think of yourself as a stakeholder outside the business. Of course, there’s work that needs to be done, and early on, the founder will be the only person available to do it. The author says to come up with a complete org chart for your business including all the roles that need to be filled. For me and Ben Franklin Labs, that might include programming, marketing, web design, sales, and accounting, for starters. Then I would assign myself to each individual role and design and document the system that describes that role. After I developed a system for each role that was proven to produce the right result, I could hire someone else to fill that position and I could move onto the next position, and repeat.

There was more to the book that I’m not summarizing here but those are the broad strokes that I remember off the top of my head. This is definitely the kind of book I plan to go back and re-read and study, just like I’ve done with How to Win Friends and Influence People and The 7 Habits of Highly Effective People.

The E-Myth is exciting to me because a) the author recognizes the fact that people like me tend to create jobs for themselves, not real businesses, and b) he describes a path for escaping jobhood and creating a real business, e.g. a business that doesn’t require my constant presence.

I’ve already started with the org chart for both BFL and Snip. Looking forward to seeing where this takes me.

Weekly Snip Report, April 8th, 2015

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There’s a certain plan of action I’ve been sharing in my posts for some time. I’ve been sharing only the yet-to-be completed steps, so the plan keeps shrinking. Here’s what’s left of it:

  1. Redesign website
  2. AdWords
  3. Get as prominent as possible on Capterra (Capterra is the #1 result when you search for “salon software” or “hair salon software”)

I’m frankly not super sure why I felt #3 was important or high-level enough to make the list. Anyway, I realized the other day that most of my previous tasks were time-taker-uppers (e.g. lifecycle emails, bug fixes) and that all three of these remaining items are money-taker-uppers.

This dovetails conveniently with some other things I have going on right now. On the consulting side, I recently found myself currently staring down the barrel of several months of 50ish billable hours per week, potentially, and wondering in that case how I would carve out time for Snip. But then I realized, a) spending money on Snip isn’t necessarily less helpful than spending time on Snip and b) money, as opposed to time, is probably actually what Snip needs right now. So theoretically I could spend almost all my time on client work and not feel guilty about it as long as I put a reasonable portion of my earnings toward growing Snip.

I met with a designer last week to kick off the website redesign. So that process has been kicked off and it’s pretty much out of my hands for the time being.

My consulting situation keeps improving. I’m not sure whether to credit my own deliberate efforts or luck or simply the fact that I’ve been putting in time. Realistically, it’s probably a combination of the three. One thing that can almost certainly be attributed just to luck is the fact that I’ve had five prospect conversations all land on top of each other, and so I’m in a position of having much better options and leverage than if I just had one single prospect in hand. It’s probably not total luck that the prospects are there, I’m just saying the timing is fortunate.

So as far as Snip goes right now I’m just waiting for the website. I guess while I’m waiting I can make a little progress on what I consider one of Snip’s biggest shortcomings, which is the somewhat-incomplete text and email reminder features.

Weekly Snip Report, April 1st, 2015

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Yesterday was the deadline for my goal of reaching $1000/mo in revenue by 3/31/2015, which I missed bigtime. My current revenue is about $380/mo. It made me think that for my next goals I should choose something closer to the beginning of the funnel where I have more direct influence.

So here are my new goals. These are all conversion rate goals.

AdWords CTR 1% Already previously achieved
Trial sign-up 5% 4/13/2015
Activation: provide stylist names 50% 4/27/2015
Activation: provide service names 25% 5/11/2015
Activation: schedule at least one appointment 10% 5/25/2015
Paying customer 5% 6/8/2015

So let’s talk math for a second. Let’s say I buy 1000 AdWords clicks for $1000. If I have a 5% visitor-to-trial conversion rate and 5% trial-to-customer conversion rate, then 5% of 5% of 1000 is 2.5. So under that scenario a paying customer would cost $1000/2.5 = $400, which would almost certainly be profitable. I realize the cost of 1000 clicks would probably be more than $1000, but even at $3/click the cost of acquisition would still only be $1200, which I think would probably still be profitable.

As of March my trial sign-up rate was about 11/900 = 1.2%. (That’s 11 trial sign-ups and 900 unique visitors in March.) I’m meeting with my designer later today to kick off a so-badly-needed website redesign. I expect a more professional-looking site to convert a little better even without much in the way of copy/content improvements. I’ll be much more motivated to put effort into content improvements once I’m no longer ashamed of the site, once I “believe” in it.

The next coarse-grained conversion that happens is trial to customerhood, but that’s kind of a big gap inside of which a lot needs to happen. You could put another conversion between trial and customerhood called activation. Many prospects sign up for a free trial but then never even log in once. They really need to put in some stylists, some services, and some appointments. I think I could help grease the chute on that process by creating some sort of multi-step “setup wizard” where the first step is to enter some stylist names, then services, etc. Such a wizard would also make it super super easy to pinpoint the exact step where people fall off the wagon. The only information I have now is that they never logged in after signing up, and that doesn’t tell me much. If I could just get 10% of trial signer-uppers to put in some stylist names, services names, and schedule at least one appointment, that would be a big improvement over where I am now.

So those are my new goals. I think they’re within more realistic reach than many of my old ones. Wish me luck.

Snip goals

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Some time ago I had set a goal to get Snip to $1000/mo in revenue by March 31st, 2015. Today is 3/31 and my revenue is still about $380/mo, which is actually even less than it was when I set the goal ($430ish).

It kinda hurts to not only not achieve a goal but to slip further away from it. It may or may not be productive to ask why I didn’t hit my goal. Actually, the question to ask would be why my revenue didn’t go up a single dollar. What I think needs to happen is that I need to move down to a metric I can influence more directly. Revenue is a result, and specifying a desired result goal doesn’t necessarily say anything about how that result might be achieved.

I was thinking about these things today along with the fact that now that this goal has expired I need new goals. I was thinking about how my website is so appallingly terrible. Maybe my goal could be to have a website I’m proud of and that I consider good. But that’s not very measurable, plus it’s the effectiveness of the site that matters, not how good it looks (not that it shouldn’t be both effective and good-looking). So maybe it would make sense to set goals around certain conversion rates.

That’s what I decided. I said why don’t I set a goal to get visitor-to-trial conversions to 1% and trial-to-customer conversions to 10%. So for every 1000 uniques per month, I can expect one paying customer.

Then I checked my numbers and realized my visitor-to-trial conversion is already about 1%. In March I got about 900 uniques and 11 trial sign-ups, obviously better than 1%. So I guess I’m good there, although 11 trials per month doesn’t feel like enough to work with. If my trial-to-customer rate is anything less than 10%, I wouldn’t nexessarily get any customers at all that month.

So I figured traffic should probably play into the goal too. Maybe let’s roughly 2X the traffic to 2000 uniques a month.

More on this later.