IAM1604 – Author and Journalist Explains How to Build a Successful One Person, Million Dollar Business
Podcast Interview with Elaine Pofeldt
Why it was selected: This interview with Elaine on the CEO Chat Podcast was one of the reasons I started the I AM CEO Podcast and how you can redefine entrepreneurship, success, and what it means to be a CEO. This is a different and unique perspective and I believe you increase your likelihood of success if you begin with the end in mind. It's also important to pay attention to what and how you are thinking too.
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Previous Episode:
Elaine Pofeldt Teaser 0:00
Using low-cost marketing tools. So for instance, Facebook advertising is really important these days or other types of pay-per-click advertising, it gives you a huge reach. You can really target your marketing to a specific audience.
Intro 0:15
Do you want to learn effective ways to build relationships, generate sales and grow your business from successful entrepreneurs, startups and CEOs without listening to a long interview? If so, you've come to the right place. Gresham Harkless values your time and is ready to share with you precisely the information you're in search of. This is I am CEO podcast.
Elaine Pofeldt 0:43
I am a journalist who especializes in entrepreneurship and careers. And I’ve been writing about one person businesses and entrepreneurs in scalable businesses for number of years. And what I have been working on lately is a new book the Million Dollar One Person Business. It looks at how people in solo businesses and partnerships
are getting to one million dollars in revenue without hiring employees.
Using low-cost marketing tools. So for instance, Facebook advertising is really important these days, or other types of. Pay per click advertising, it gives you a huge reach. You can really target your marketing to a specific audience, and that's something that you just didn't have 10 or 15 years ago to grow a business. So mastering those types of things or outsourcing it to someone who has, can also help your business grow. And there, there is some investment in it, but if you wanna grow, you do have to invest in your business as you have the money available. And that doesn't necessarily mean in the first month or two. It means, you know, as you have the cash flow to support it.
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Gresham Harkless 1:49
Yeah, that makes perfect sense. And, and I think one of the things that kind of even resonated with me, and I'm sure a lot of people that are listening, is sometimes when you think of a one person, especially a $1 million business, you automatically think, well, that person must not sleep at all. But it sounds like the things that you've talked. Right. But that first, but I, I like the fact that you talked about, you know, finding automation tools, finding other people you can maybe outsource things to. So it's not necessarily that person doing everything. It's that person understanding where their time is best well spent, and then finding out how to take the minutia off their plate so that they're able to kind of continue to grow.
Elaine Pofeldt 2:31
It can be done gradually. I should add to what you're saying. I, I think that you can't do all these things overnight, you know, so maybe you decide, okay, this week I'm gonna add the scheduling app. Next week I'm going to a mileage tracker to my phone so I don't have to write it down every time I get in the car and drive to a client where I'm, the week after that, I'm going to attach my QuickBooks or FreshBooks to my business bank account and to my business credit cards so that those transactions get pulled in automatically. You can, you can do it slowly and focus on the low-hanging fruit first and the low-hanging fruit. If you're doing a startup or you're starting a business on the side and you don't have a lot of startup capital, do the free ones first and then you concentrate on the lower cost ones like the scheduling app maybe will cost you $60 a month a year now, which isn't that much when you consider what your time is worth. And then as you get more revenue coming into the business and you can support it, maybe you invest in a CRM system which might cost you more, maybe it'll cost you a hundred dollars a month so you can build a mailing list for the business and reach your followers. You, you can't do it all overnight. I, in my own business, I try to set a goal of one or two things like that every. And if you, maybe you get one of the two done, but at least you're ahead of where you would've been if you didn't even put them on your list. And you have to also focus on the ones that will move the needle the most for the business. So maybe for an e-commerce business, the number one thing you should be focusing on is learning how to do Facebook advertising or building your mailing list. Whereas for a professional services type of business, it might be something entirely different. You have to really think about the strategy of the business and what is the one thing you can do this week that will really move you forward towards your biggest goals.
Gresham Harkless 4:20
Yeah, that makes perfect sense. And I always. Think about anytime I hear that people think that an overnight success happens overnight, but really it takes years and years and years sometimes of doing things once a, you know, if all you have as a weekend is doing that one thing during the weekend just to kind of move the needle over a little bit more so that you're able to kind of reach whatever goal you might have.
Elaine Pofeldt 4:40
It can take time, Gresh, but it's funny how there's sort of a momentum game to business. So I'll give you an example. Laslow Nadler. Who appears early in the book, runs a business called Tools for Wisdom, and he's a young dad. He's got two children and a wife. He's the main breadwinner and he was working for Big Bank as a project manager and he loved certain aspects of his job, like time management and doing things more efficiently. But he wanted to be self-employed. So on the side, he started the business and built it over two years before he quit, and a certain point. He hit six figure revenue and he really understood how to grow the business. The revenue really took a big leap, and now it's at 2 million in annual revenue. So I think if you take a little time to master the basics of the business, all of a sudden you can step on the gas pedal and be really impactful and you'd be surprised. So it, it can be like a 10 year overnight success for some people. And it, it depends on the nature of the business, but there is a sort. Return on the time that you put in early on. And I think the momentum tends to pick up after, usually after one or two years. So don't get discouraged if it's going slowly, because it can pick up very quickly once you really know what you're doing with that business.
Gresham Harkless 5:59
Yeah, that makes sense. And then I think even like you said before, if you focus on the business, not just time spent too, it's probably time spent in the right places because like you mentioned, the strategy and the high level things rather than organizing your emails, but if you're spinning it in very like, I guess very pivotal places, it can help you kind of gain momentum fast. Is that correct?
Elaine Pofeldt 6:20
That's true. Gresham, I think we all make rookie mistakes. I know in my business, the first year of my business, I wasted time with clients that were underpaying me greatly, paying me extremely late, not being respectful of my time, and I didn't really assert myself because I was so. Happy to have any business at all. You know, and I think a lot of people are like that. You feel like, okay, my dance card is full. So that's good. And, and to some extent it's true there is sort of a, um, critical mass of clients you need. But as, as I've grown my business, and I think a lot of people do this, you think, you know what? That's really not good for my cash flow to work with somebody who pays me nine months later. I just can't run a business that way. And while that person might be nice and they might need my help, I just can't do it anymore. I have to focus on the clients where it's more of a reciprocal arrangement where we both treat each other really well. And, I think you'll weed out some of those low value activities over time because you'll start to realize how there are so many moving parts to a business and if, if certain parts are not working, it affects other things. So if you're, if you're wasting time collecting from somebody over and over again, that's time you could be spending with a better client. And I think those are things that will dawn on you over time and you shouldn't beat yourself up feeling like. You failed if you made these mistakes because the mistakes are part of learning too. In fact, one of the things I loved about the interview with Ben and Camille Arneberg was how they viewed the investment they put into their business as almost a college course. So they, they put in about $5,000 initially into inventory at Willow and Everett, and, they said this would be how much we would pay for a college course. So even if we lose all the money, we'll have learned so much from that. You shouldn't do it with money you can't afford to lose. But if you do have a certain amount in your startup war chest, then you should look at it that way. And the same thing with your time. You might, you might waste some time, and if you're not an efficiency expert, the first year, Nobody really is, but you can get better. We can all get better and suddenly the learning will kick in. That's what I found with all of these entrepreneurs. They kept on learning and paying attention to the signals around them, and then all of a sudden they would figure things out and they could really double down on what was working.
Gresham Harkless 8:45
That's interesting, especially that the idea of how they constantly kind of improved themselves and then got better and, and as a result their businesses got better as well. Now, have you seen, or what are some of the reasons that maybe you've heard of or know of that people that want and aspire to build similar businesses don't actually get the opportunity to do that?
Elaine Pofeldt 9:07
Everybody has the opportunity to do it. It's more a matter of whether you have the will to do it right now. I mean, there are lots of people, I'm sure you know, people that say, you know, I wanna start a business. I have a great idea, and they never get around to it. There are often reasons they don't get around to it. Maybe they. Deep down don't really care about it that much. Maybe they want to, but they care about other things more. They have other priorities right now, it doesn't mean they can never do it. It might mean they're really max out. You know, for instance, if you have very small children and you're taking care of them, it can be hard to start a business at that time. I started my business when I had three children who were ages four and under, including a baby, and now I have four children. That wasn't ideal. I did it, but it was hard. I was very tired in the beginning. So some people might say, you know what? I value my sleep right now. I need to be fully awake during the day.
Gresham Harkless 10:01
Right.
Elaine Pofeldt 10:02
And, and I'm gonna wait two years to start a business. I wouldn't beat yourself up if you're in that state of mind right now. Or you might feel like, you know what? We have a lot of. Family financial responsibilities. Maybe you have a child in college or something like that and you, you have to pay a lot of bills right now. It might not be the right timing, but what you can do if you're serious about it, is start learning. There are all kinds of great online courses out there now. There are great podcasts like yours. You can learn so much. From learning from other entrepreneurs, you could start, you know, maybe once a month, go to a meetup in your community for entrepreneurs just to sort of keep in touch with other entrepreneurs and, and keep your interest alive. And then when the timing is really go ahead and do it. Now, the other thing I hear about from people is startup cash is an obstacle and it's an obstacle for every. , not that many people have the startup cash that they need. Probably the vast majority don't. But the good news is a lot of the types of businesses I've written about in the book really don't require much.
There were a number of people that started with less than a thousand dollars. I didn't really have any startup cash in my own business. I, I had, well, I had a computer and I had a phone, and that was it basically. And then my, you know, my startup cash was my own labor . And if you're in professional services, that's the case.
You do, you do need. To have some savings or some other other source of income. So if you're the main breadwinner and your family is depending on your income to pay the bills, I don't recommend just getting mad and getting your job and having no other source of income, because it takes time to ramp up the revenue and you don't wanna.
Start the business under terrible financial pressure or where you're severely inconveniencing your family. You know, where they're worried about having groceries or, or having a roof over their head that isn't really fair to the other people in your life if that's the role you've been playing. So you need to try to find a way to frugally, maybe do some side work or whatever it takes to get a little bit of savings in the bank. I would recommend no less than two months of living expenses, ideally a little more before you leave a job and start a business because you, when you're in a do or die situation, some people thrive under it, but I think most people get really stressed and they'll wind up having to go back into a traditional job, which you don't wanna do.
If this is the business you want to start.
Gresham Harkless 12:23
Yeah, that makes perfect sense. And yeah, understanding, you know, of course, like what your goals are and understanding what your, your realistic situation is and trying to make decisions based off of that. But it, like you mentioned, it doesn't sound like, okay, well I can't start a business today, but that doesn't mean I can't build towards actually launching that business by going to meetups or listening to the podcast or taking this online course, or all those different things that you can do to try to build yourself up to when that business actually launch.
Elaine Pofeldt 12:50
There's so much you can do. And even if you can't really start the business now, just think about how much you would accomplish. If you said every week say it's, I don't know, Saturday morning at 11:00 AM I'm gonna spend one hour on something that will help me get closer to this business. And you put it on your schedule.
You picked a time when you have nothing else to do and you're gonna stick with it. And maybe, you know, one week you're gonna learn about how to set up a CRM system, or one week you're gonna. A LinkedIn profile for the business, something you can just do in one hour. At the end of the year, you'll have put in 52 hours into that business, which can really have a big impact.
A smart person, a focused person who puts forth one hour of effort, can get a lot done, so don't discount small amounts of time. It doesn't take that long to do things. I, I know we put up a website for my business, a speaker website. And it took about three hours. That was it. So I think if you think about how easy it is to do things, you might feel less discouraged too, cuz a lot, a lot of the programs out there aimed at small business owners have just gotten better and better.
And they're so user-friendly and so easy that even if you're the least technical person there is, you can use them. There's so many YouTube videos you can learn from, or linda.com or I wouldn't discount just calling the helpline sometimes at at the programs that you use. I had a question about QuickBooks and I was getting very frustrated watching a tutorial that was about a slightly different version of QuickBooks than I actually had. So I called the helpline. We resolved the problem in. Two minutes and it was wonderful. It saved me hours of just trying to figure it out on my own. So try those phone numbers. Sometimes they have really good people on the other end, and that might be just what you need. And you may never have to revisit certain tasks too.
Like what I did is something I, I have to do once a year. I probably, you know, now that I know it, I'll never have to really go back over it again so, so it's a little investment of time, but you're now, I moved the business forward. I did what I had to do and it's done. I think community is very important. Gresham, what I've found with. The businesses in this book was the folks who ran them were very generous in sharing information with other people. A lot of times I interview corporate CEOs and it seems like they're trying to tell me as little as possible, you know, they're very guarded, and that's because they're representing big corporations.
But in these ultimately businesses, they only had to answer to themselves, and I found they were very free in sharing information with each other and giving back to the community of others brought resources to them that they didn't expect, so other people would have businesses. So I would say, find some friendly competitors and I have this in my own field there’s other small business journalist I can not rate every single article on small business entrepreneurship, I have a certain capacity, so when I can’t do things, I refer work out to other people. Or team up with other people. You can scale in that way too.
Outro 15:58
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