Running a business can be a daily struggle, yet at the same time, it’s just super cool.
“I’m an entrepreneur” always raises an eyebrow when asked by people you first met at a party.
People find it interesting to know what you do. What they really find interesting is WHY you became an entrepreneur.
The most common reply from these people is “I’d like to become an entrepreneur, but I don’t have the stomach to leave my well-paid job. I have a family, a mortgage I find it too much of a risk”.
I can’t agree more. Leaving a great job to start up something on your own is risky.
There are no guarantees you will succeed, and chances you will fail and lose whatever you have come accustomed too is subject to your success.
So yea, let’s say it as it is: Entrepreneurs are badasses.
We put just about everything we find valuable on the line and for what?
Well, the what and the why differs per entrepreneur.
One may have left the company because they got redundant, another because they live in an area where jobs are scarce, and some are like me: Daredevils and right out nuts.
Yes, I consider myself nuts at times.
I left an excellent job, well paid, great benefits, super pension, company car and a beautiful comfy office.
During my eight years on the job, I got promoted a few times, more responsibility, more people to manage, and a bunch more labels to manage.
I was on a roll. Everything was great.
But one day our division was to be sold, and my job turned into something I wasn’t enjoying.
My boss and I had a good talk, and we decided it was best for me to leave.
I decided it was time for me to leave corporate life and do something I always dreamed of.
Three months later, I went to the chamber of commerce and registered innotrends.
Wow, what a day that was.
Running a business
Running a business doesn’t have to be complicated if you have the right people around you.
I arranged my company insurance, personal liabilities, health insurance, pension and everything else that I could think of.
Because of my past job, I also know how to run businesses financially.
Although these where multi-million businesses the fundamentals stay the same.
I sometimes look back and realize what excellent schooling I received from my old job.
Don’t spend too much; only take calculated risks and always stick to your ideals.
I sat down with my accountant, made a financial plan and then it was time to get a site in the air.
What is it what you do
A good friend of mine who has done exceptionally well for himself as an entrepreneur once told me “Scott, the first few months of opening a business your network will have you top of mind. You may expect your first orders right off the bat. But after the first year, you need to buckle up because then you need to find your clients.”
Indeed, I just launched innotrends, and my first client rolled in, not long after a mate of mine asked for my services for the largest newspaper in The Netherlands.
After I finished these projects for the first time, I felt how lonely entrepreneurs could be.
I was so busy with these super enormous projects I failed to find new clients, but even worse; I didn’t spend time defining what innotrends has to offer.
My work was always related to making more money online.
My capabilities building sites is good, I have a strong SEO knowledge. I’m a certified systems engineer. In short; I have a good understanding and am knowledgable.
I created my new site promoting my building websites, auditing sites, SEO skills.
Each potential client that called me became a client.
It’s not like hundreds of calls a week, but I guess two people a month called me for an appraisal.
It was okay, I was making a decent living, and I still am. How cool is that?
But then it struck me: What the hell am I doing?
When people ask: “Scott, what do you do,” I told them “I build websites, search engine optimization, you know that kind of stuff.”
They would nod and say “ow that’s cool, my son (15 years old) is also building sites. He just landed his first client a few days ago.
He’s thrilled because with the money he’s making he can finally buy the new xbox he’s been nagging me about”.
You can imagine I nearly exploded because this guy was comparing my 23-year experienced service shizzle with a 15-year-old lad wanting to buy an xbox.
What an asshole.
Looking back, I was the asshole.
It was my failure to explain what I do. I was so hung up in my services what I offer.
I never stood still and thought what my knowledge, experience etc. can deliver the client.
There was no story, nothing to hold on too. I was just that guy designing sites.
This is not what I wanted. I don’t want to be compared to that 15 year old punk.
The next day I closed down my computer, laid my iPhone, iPad and all other stuff away….drove to the closest coffee bar and sat down with a pen a paper in my hand.
The first hour I was staring at the walls, I was empty.
I found it hard to describe what innotrends stands for, what the service is, and who and what type of business my services are most relevant for.
Can you believe it. The most fundamental questions remained answerless. It was crazy.
But this goes to show I was steering a boat without direction and navigation.
All though I was making a handsome income, the company innotrends was going nowhere.
3 hours later it dawned on me:
What I am good at and what I like to do is help my clients make more money.
This can be achieved by creating a new site, improving their SEO or by creating lead magnets.
It was all directed at helping THEM make more money, and the in-direct result was they had more time to spend with their family.
How cool is that?
But how can I sell it?
Well, it became clear I need to think hard because the following example was a great stimulant.
A good friend of mine referred me to a friend of his. He called me.
The client sells and installs air conditioning systems for companies.
He just started, had no website, not even a logo but was already working for a bunch of clients (just like I did when I began).
He said he needed a site because he wanted his potential clients to find him on google and offer them information about his services.
Pretty standard stuff. We agreed to a fee of $2500 (partially because it was going to be a pretty simple site, and the client just started his business).
I didn’t want to make it any more expensive for him than necessary. Starting up a business is costly as it is.
A few weeks later the site launch and everything went well, as planned.
Three months later I called him and asked if he’s still satisfied with the site?
He replied: “Hell yeah, Scott, this is crazy. I don’t know what you’ve done, but I’m receiving three to five requests a week.”
How happy I was for him.
So I asked him “How much are you making now from one airconditioning install?”
He replied, “If they purchase the system from me, which most do and I install it, well I guess I’m making about $1300.”
But that’s not the complete story. The client continued “Remember you told me to offer maintenance service as well.
Well, I implemented your idea, and I now sign them up for a Service and maintenance agreement.
On average I sell the Service agreements for about $500 annually excluding parts.”
So this guy is making at least $1800 per client, he’s generating eight prospects a week, which is roughly 30 a month.
Now let’s assume 30% of the inquiries become a client. 20% become a client within six months, and the rest drop out.
This guy is making good healthy money, and I played a role in this success.
Although I’m extremely happy for him, I merely earned $2500 for this job.
But what if I’d turn things around and asked him “If I create this site for you, how many information requests are you expecting?
What if I asked how much his average order value is and what if I offered him a way to earn much more by presenting my maintenance service contract idea at a later stage.
Do you think $2500 is the right price to ask?
More like $20.000 would make much more sense.
How to sell a $20.000 idea to a client?
Well, this is where it gets pretty tricky.
Many online tutorials, videos, books and courses make it seem super easy, but it’s isn’t.
If you followed the above scenario I encountered, it makes perfect sense asking the amount of $20k.
It only makes sense because he shared the information with me after the first results became clear.
But there you have a client, just started and you’re asking $20k for an idea that may or may not work.
I now have a shortlist I ask all clients:
- What’s your annual revenue
- What’s the average margin
- What’s the average order value
- What yearly income do you see yourself making in the ideal situation
After they responded I ask them the following
What if I told you I could help you outperform the answer you gave to question number 4?
What would you work-life balance be like if we, together, would outperform?
and then just shut up for a moment and let the client think because they are thinking.
There’s not one sales rep which has ever painted a brighter future for this client.
It’s always, the client pays for a service and gets what they asked for- boring.
But what if I could make a change, a positive impact on this guy’s work-life balance.
Yes, it’s a risk my idea’s and solution won’t reach the targets. There’s always a risk.
But people take calculated and un-calculated risks all day long. Risk-taking is what all entrepreneurs have to deal with
It’s like going to the casino. You can win, you can lose.
If my work will assist in reaching and may even outperform his most ideal situation, it’s worth at least 20k.
So why have I been selling my product for 2.5k? Looking back, that’s plain stupid.
Don’t sell the solution, sell a future.
Embark together on a journey your client can see, feel and really wants to reach.
Make sure you explain you need his or her help to make this work. You can’t do this on your own.
Good luck and if you have other experiences please share them below in the comments.