GREAT STORY ...
It has been a tough and arduous journey the past 1.5 years and although there is a long road ahead still I think that I have started gaining momentum. I mulled over doing this post for couple of days as I am aware of the fact that I am still getting started. Then I exchanged a few emails with Likwid about his progress and decided this is a good time to update on my own and share some of the things I have learned in the process with the forum.
Let me get the milestone out of the way first. September was the first month for me when I topped $10K (in a month). I have been doing a few thousand a month for over a year now but not so much to give me the warm and fuzzies. The doubts kept coming back. Now with September showing and October running well as well, I know that the business is going to work out and I am moving in the right direction.
I have been a member of this forum for a long time. The last time I posted in this thread, I was running a different website that I sold last year. Early last year I started my current business (also internet based) that allows me to do what I passionately love to do and create real value to my clients (attested by my clients, see later in this post). It is a stock recommendation service for long term investors and I focus on finding undervalued stocks. The main thing that differentiates me from other similar services (although there are very few targeted for long term value investors, most of the other services tend to be in the "penny stock" niche that I don't touch) is the fact that I eat my own pudding. I invest in all the stocks I recommend with my own money and I have put my entire portfolio available to my members.
That and the fact that the performance of my portfolio has been excellent so far gives me a lot of credibility which helps.
Learning #1: Value Trumps Everything Else
My offering looks vastly different today than it was when I first started it. Most of 2011, I desperately tried to build up my client base and in the process I offered low membership fees, discounts, free trials and money back guarantees. The result was that I did get many customers, a vast majority of whom had no intention of hanging around after the trial period or the guarantee period ended. So I ended up processing many refunds. The worst part though was that I was cheapening my brand and setting wrong expectation of value in my customer base.
Starting Jan 2012, I did away with all the discounts, trials and even took out the money back guarantee. At the same time, I raised my price by about 8x fold. I continued to deliver excellent service and performance to my customers.
The result is that I do not get many impulse buyers now. But what I do get is a lot of phone and email contacts who are very interested but want me to answer a few questions before they make their decision. It may take a few weeks to a month or so of back and forth, but at the end of it, I have been successful in converting 100% of all the leads that I have spoken to over the phone.
My membership is now growing faster today then it did a year ago at a higher ticket. This is all the more remarkable if you consider that with all the various Google updates this year, my traffic from Google is down about 80% compared to last year.
How my current customers attested to the value
For the longest time I saw the pattern of a lot of activity, asking questions etc for a week or so after a new customer signed up. After the first week or two, the interaction became very rare. I do have a forum for the members so there is interaction there but there was not much to tell me if the my members were really happy with the service and had nothing to ask about, or that they were really disgusted and did not care about it any more.
Then in September, I offered a new pricing plan. Originally I had monthly subscription option and an annual option. I added a lifetime subscription option with a one time payment (which cost much more than 1 annual payment). I never publicized this new option to my current members. Within 2 weeks I got emails from 80% of the members expressing a desire to upgrade and the emails included things like "you cannot understand how valuable your research and recommendations have proved to me and my family". I even received an email from a customer who was already on a lifetime subscription (my first customer, did a custom plan for him last year) saying he feels guilty that he underpaid me and wants me to name a price.
I know this is business, but more than the money, the realization that I am adding so much value to my customers doing exactly what I would be doing anyway even if I did not have this business, makes me now feel that there is no possibility of this business failing now and all I have to do is to keep doing it and stick it out.
Last 2 years have been really tough with my once stellar credit shredded to smithereens, very little chance of going back to corporate job. Thank goodness! For a laugh, since I have been working on my business for over 6 years now, used to run a steel company among other things, my last employer came back to me late last year when I applied there in a moment of weakness saying "your background does not match what we need". I had to muster all my will power to not reply to them saying my background includes working with you for 5 years!!!
Learning #2: When passion is there, it shows, and people help out. Often unexpectedly
Early in 2012 I was struggling with the traffic drop from Google. I got an email from Chris Kitze (credits include Lycos, Xoom.com, Wine.com, Intellius, etc, an early internet entrepreneur) and we ended up talking over the phone. He helped me understand why I should not depend on a single source of traffic (such as Google) and how to go about expanding my marketing and how to make it more targeted. I took his advice to heart and as a result Google is just a small part of my overall traffic. My clients now find me via Twitter, LinkedIn, and various other sites such as Business Insider, Forbes, etc where I write as well. My membership now includes fund managers and hedgies that I could have never reached if I was still playing the SEO game.
Regarding SEO, someone reached out to me last year. She has worked on many brand name sites helping them get noticed when they were starting out including Amazon, creditcards.com, etc. I could not afford her, of course. We went back and forth for couple of months and now she is helping me with marketing and in return I help her with her stock portfolio. She has already made more profits with my help then she would have earned in fees from me. It just costs me an hour of my time every 2 weeks or so.
Finally, being a firm believer in the Nike slogan "Just do it" (by the way, the best 3 words every put together alongside each other), I started last year offering my services even before the website was fully complete. One of the first members to sign up is a mutual fund manager, and instead of deciding to cancel for an incomplete offering, he helped me out set up the various sections of the website. Proud to say he is still a member and recently upgraded to lifetime.
If I had worried about planning for every little thing, none of this would have happened. I just decided to go for it and the right people appeared at the right time as if by magic to help me out.
Lesson #3: There is no such thing as a failure
I quit my $150K job in 2007 to buy and run a steel company. By 2009, with the economic shock, I have had to close shop. By all accounts, I had failed. However 2 really good things came out of this.
#1. In 2008 I was working with JP Morgan Chase on a loan/line of credit for my steel business. Everything was on track and I was within a day or 2 of closing the deal. Unfortunately, this was precisely when Lehman Bros collapsed and all hell broke loose. JPM came back saying they have stopped doing any loans for the foreseeable future.
I am still friends with the JPM Chase VP I was working with then. He took me aside and said that he has been reviewing my tax returns that I submitted with the loan application, and looking at my investment returns, he thinks I should just go ahead and make a career in investments. He planted the seed.
#2 New York Times did a story on entrepreneurs in November last year and I was featured as a lead in to the story on both the website and the printed paper. They included a link back to my current site (dofollow link for people who are interested in such details :-)). This story was later republished on cnbc.com and many other local newspapers with the links intact. Much more than the power of the link, it gave me instant exposure and helped me establish a brand which would have been impossible to do otherwise without paying a pretty penny. It also drove huge amounts of traffic.
I believe that the fact that a New York Times reporter has personally spoken to me and considers my site worthy of linking to gives me instant credibility in minds of my prospects that otherwise would take a long long time to build.
When all is said and done, I expect that these 2 things that came out of my earlier business "failure" will end up making me much much more over time than running a steel plant would have ever done.
Finally, my services are not cheap. I charge more than my competition that includes likes of Zacks.com, MotleyFool.com, etc. But as Chris told me (and as MJ has said many times over), focus on the value you deliver and if you help people make money, you will be found and paid your price. This has been proved true in my case. I am happy to get on the phone with my clients, meet them in person if they are local, etc which none of these other services will do. As a result, I now have members who have migrated away from these other services, found out the level of service I offer and have been actively recommending me to their friends on their own.
As I said, I have been a member of the Fastlane forum for many years now but have not posted much since I was busy working on my business. If I rambled a little in this post I apologize. I felt the need to share and hopefully some of this will ring true with your experience as well.
Excited and looking forward to the next stage of my journey!!
GREAT STORY ...
Just curious here - wasn't going to ask but I'm wondering how this sort of thing can impact your business - I googled your name to find your website and the 3rd result, as I'm sure you're aware, is an FBI page looking for someone by the same name for committing cyber crimes. Do you get asked about this constantly? Do you think it hinders your business in anyway? I guess that's a strong reason to show your picture wherever you can
Thanks Pete and Jake!
Value Stock Guide
No one has asked me about that! Not sure if it has any impact. But I do have my picture show up everywhere including on Google searches and it is easy to see that I am not the same guy (the full name is also different as I recall).
Most of my brand is built around the site, not my name and even when people do search for my name they have part or all of my web site name included in the search, so normally this is not a problem.
I wouldn't rule it out though. I think the only way to mitigate is to make my brand much more powerful and that is happening over time.
Value Stock Guide
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