Where I have been this time... and why I'm famous at Wells Fargo

[Kak]

'Some dude on the internet' would not give this type of advice. And his advice is more valuable than anything I could have gotten from all the people I know in real life. Most people don't give a shit what you do in life and they definitely don't give useful advice.

I wasn't aware i needed it but i did. You don't have to like my posts.

I'm aware I don't have to do anything I don't want to do. I do like that post above where you are taking responsibility.

Thank you for not thinking I was doing this to be an a**hole, because I wasn't. I received similar advice once upon a time.

 

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[MTF]

@Kak, thank you so much for this thread (and thank you @brokebum for sharing your problems, it was a very educational discussion).

This might be a bit of an unusual question, but I have a feeling you may have some good insights.

I developed the belief that one should focus on one business alone and never ever try anything else because of the risk of spreading oneself too thin. This belief has served me extremely well, but I have a feeling that now it's restricting me a bit because I'm putting all of my eggs in one basket (which I don't control entirely as I rely heavily on Amazon). Moreover, it's getting harder and harder to think with more zeros as obviously at some point you can no longer grow by hundreds of percent in a year, especially in my type of business, self-publishing (is relies on my direct input).

I know I need to start thinking bigger. I'm not interested in launching another "small business" type of a business as described in your recent post as I'm not looking for more obligations, just new ways to deploy my capital and leverage it so that it can eventually run on its own. The problem is how to do it in such a way that it won't jeopardize my self-publishing business.

What tips would you give to a person who is considering expanding beyond his or her primary successful venture? How to ensure that it won't affect the original business that has made you wealthy or that it won't steal the freedom you now have?

 

[Trud09]

@brokebum

I agree that the fear is holding you back... Question is why would you willingly choose to learn this skill selling something less valuable or with less potential?

Have you read MJ's book yet?

I am curious why you are saying sales is a lower value skill. Compared to a web designer? Why would you say that? Not saying you are wrong, just different than where my thoughts are.

 

[Vigilante]

I am curious why you are saying sales is a lower value skill. Compared to a web designer? Why would you say that? Not saying you are wrong, just different than where my thoughts are.

You misinterpreted that. He has made his living selling.

 

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[Scot]

I have a question for you @Kak. This is kind of similar to @MTF's question, but a bit different.

I am currently building my first business that I really believe will deliver value and be successful. Time will tell whether that is true. However, I recently discovered a very big unmet need in my current day-job industry. I work in pharmaceuticals and there is a big resource that every single pharma company, both big and small rely on. There are only two incumbents in the industry that provide this resource. One owns the market, but is stagnant and delivers a sub par product. The other has tried to unseat the incumbent, had about 20% of the market, but still delivers sub par results. These two companies alone produce ~$5 billion in revenue.

I have the unique opportunity with my current position at my day job to get a lot of research, contacts and advice into the inner workings of this industry. If I were to pursue this lead and build a business, it would very much be eating an elephant bite by bite. I know the excuse of "needing capital" is usually false, but in this case, it would require a significant amount to start. In order to sell this product it would have to be 100% whole, companies will not purchase this product without 100%.


I feel like I have two choices here. Do I put this on the back burner (I see very little chance that these two will get any significant competition in the next few years)? By putting this on the back burner, I can focus on my current business I'm building and use the proceeds to fund the next business.

Or, do I ditch the business and start work on this new idea, going into start up mode, seek investments and give up a significant chunk of my business (and control) to investors?

I don't want to "cheat" on my business. I also have a business partner in my current one that I don't want to leave in the dirt (but I also don't think his skill set would be applicable to bring along to the pharma idea).

 

[Kak]

I am curious why you are saying sales is a lower value skill. Compared to a web designer? Why would you say that? Not saying you are wrong, just different than where my thoughts are.

In other words. Why would you willingly choose to sell something less valuable while you are trying to learn this skill?

 

[Kak]

Hi KAK,

awesome thread. You have already helped me very much.

My question is if you divide small business and company solely by the passivity - grade? And can human resource systems, leaving out E-Commerce business, be seen as a company?

Thanks for all the information. I'll start to think with more 0s also.. Thank you! @Vigilante

This was an example for argument sake. I put together examples of 3 different types of "business". Company, Small Business and Self Employed.

E-commerce completely depends and I left that off intentionally... Why? Because most people on this forum are in some kind of e-commerce.

I own an ecommerce business, I would consider it on the line between small business and company. It is pretty passive but I still need to label stuff, turn stuff around to FBA and put in manufacturing orders. It is OK with me that it is like that, but I still have direct input. If you were to calculate out my earning rate per hour even though this particular company doesn't make that much money, it would be pretty astronomical because of the automation systems I chose to utilize. That said, it is NOT something you can leave on cruise control for very long without seeing negative results. I call it a small business. When wholesalers are buying product from my company through a representative of the company and fulfilled without my effort... I'll call it a company.

Human resource system? Do you mean hiring the work done? Or do you mean some kind of software ?

 

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[#nowhere]

This was an example for argument sake. I put together examples of 3 different types of "business". Company, Small Business and Self Employed.

E-commerce completely depends and I left that off intentionally... Why? Because most people on this forum are in some kind of e-commerce.

I own an ecommerce business, I would consider it on the line between small business and company. It is pretty passive but I still need to label stuff, turn stuff around to FBA and put in manufacturing orders. It is OK with me that it is like that, but I still have direct input. If you were to calculate out my earning rate per hour even though this particular company doesn't make that much money, it would be pretty astronomical because of the automation systems I chose to utilize. That said, it is NOT something you can leave on cruise control for very long without seeing negative results. I call it a small business. When wholesalers are buying product from my company through a representative of the company and fulfilled without my effort... I'll call it a company.

Human resource system? Do you mean hiring the work done? Or do you mean some kind of software ?

Hi KAK,

thanks for your long and in depth answer. I have written "human resource system" intentionally. I mean the classic work force. Franchising, chaining (yep, pretty unsexy due tue "long-term".), but im into it by default now. I will bring clearance into this on the inside, in detail, soon.

I just wondered how typical fastlane-rockstar-archetypes see the classic entrepreneurship. How you think of it and so on and so forth. That won't alter my niche or my decisions (let alone criticism, I'm very open to critcicism!). I'm just curious.

I see as a clear pro, that you as a middle man can not be cut out easy. Not all, but some e-commerce businesses, have this danger. Sure it depends on your concept, marketing, your business and the boundaries in general.

Again, thank you for help and hope this could be helpful for others, too.

 

[Kak]

Hi KAK,

thanks for your long and in depth answer. I have written "human resource system" intentionally. I mean the classic work force. Franchising, chaining (yep, pretty unsexy due tue "long-term".), but im into it by default now. I will bring clearance into this on the inside, in detail, soon.

I just wondered how typical fastlane-rockstar-archetypes see the classic entrepreneurship. How you think of it and so on and so forth. That won't alter my niche or my decisions (let alone criticism, I'm very open to critcicism!). I'm just curious.

I see as a clear pro, that you as a middle man can not be cut out easy. Not all, but some e-commerce businesses, have this danger. Sure it depends on your concept, marketing, your business and the boundaries in general.

Again, thank you for help and hope this could be helpful for others, too.

Oh OK! I see. Yes traditional entrepreneurship is fantastic. A workforce that turns it's owners profits is as good as automation. Building any scalable business absolutely qualifies as a company in my book.

Buying a franchise small business... Selling them absolutely a company.

 

[Scot]

Yes traditional entrepreneurship is fantastic. A workforce that turns it's owners profits is as good as automation. Building any scalable business absolutely qualifies as a company in my book.

Agreed.
There's a reason every Fortune 500 company has employees and a workforce.

 

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[Kak]

I have a question for you @Kak. This is kind of similar to @MTF's question, but a bit different.

I am currently building my first business that I really believe will deliver value and be successful. Time will tell whether that is true. However, I recently discovered a very big unmet need in my current day-job industry. I work in pharmaceuticals and there is a big resource that every single pharma company, both big and small rely on. There are only two incumbents in the industry that provide this resource. One owns the market, but is stagnant and delivers a sub par product. The other has tried to unseat the incumbent, had about 20% of the market, but still delivers sub par results. These two companies alone produce ~$5 billion in revenue.

I have the unique opportunity with my current position at my day job to get a lot of research, contacts and advice into the inner workings of this industry. If I were to pursue this lead and build a business, it would very much be eating an elephant bite by bite. I know the excuse of "needing capital" is usually false, but in this case, it would require a significant amount to start. In order to sell this product it would have to be 100% whole, companies will not purchase this product without 100%.


I feel like I have two choices here. Do I put this on the back burner (I see very little chance that these two will get any significant competition in the next few years)? By putting this on the back burner, I can focus on my current business I'm building and use the proceeds to fund the next business.

Or, do I ditch the business and start work on this new idea, going into start up mode, seek investments and give up a significant chunk of my business (and control) to investors?

I don't want to "cheat" on my business. I also have a business partner in my current one that I don't want to leave in the dirt (but I also don't think his skill set would be applicable to bring along to the pharma idea).

This is a very good question and I ride contrary to popular opinion on this forum, however my businesses are ALL built to scale with a very passive setup.

I think having multiple streams of income is a good thing. I currently have 4 businesses and I am working on a 5th.

1. Ecommerce
2. Raw materials sourcing/private label raw material
3. Government Service
4. Another government service company
5. I am running numbers on buying my first business real estate. Apartment complex maybe?

How do I find the time in the day? Strategic partnerships. Resource allocation. A level of passivity.

Look up fixed vs variable cost on investopedia... I like to look at my time like that too. I don't mind a fixed investment of my time, but a variable investment of my time is unacceptable to me.

OK now to address the pharmaceutical deal you are presenting here... I would definitely be sure to figure out the numbers of the competitors. If you came in with a better product at a better price, they also might have the ability to just match you and put you out of business. This is very interesting and game changing in my opinion. And DEFINITELY worth a look and effort. There are VCs that do nothing, but pharma out there. Put together a team, put together a compelling business plan, and go in there to kill it!

In the meantime I see no reason why you can't start the other business. More money is better.

 

[Kingmaker]

Having a monopoly or at least running an economic cartel on some kind of commodity has always been a goal of mine.

@Kak Can you talk about this a little? I can't quite get my mind to wrap around a goal of monopolizing exports of an entire COUNTRY.

 

[Scot]

This is a very good question and I ride contrary to popular opinion on this forum, however my businesses are ALL built to scale with a very passive setup.

I think having multiple streams of income is a good thing. I currently have 4 businesses and I am working on a 5th.

1. Ecommerce
2. Raw materials sourcing/private label raw material
3. Government Service
4. Another government service company
5. I am running numbers on buying my first business real estate. Apartment complex maybe?

How do I find the time in the day? Strategic partnerships. Resource allocation. A level of passivity.

Look up fixed vs variable cost on investopedia... I like to look at my time like that too. I don't mind a fixed investment of my time, but a variable investment of my time is unacceptable to me.

OK now to address the pharmaceutical deal you are presenting here... I would definitely be sure to figure out the numbers of the competitors. If you came in with a better product at a better price, they also might have the ability to just match you and put you out of business. This is very interesting and game changing in my opinion. And DEFINITELY worth a look and effort. There are VCs that do nothing, but pharma out there. Put together a team, put together a compelling business plan, and go in there to kill it!

In the meantime I see no reason why you can't start the other business. More money is better.

Thanks @Kak. I definitely want to have multiple income streams. I know that my current project lends itself to be minimal work once it reaches its desired point. The pharma one, not so much.

As Q1 kicks off tomorrow, I'm going to start doing some digging and research. And I'm not worrried about the other companies changing their game, because I have a unique twist I'd add that will not directly compete but may open me up to be acquired (which in that space is a bad thing).

 

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[Kak]

@Kak Can you talk about this a little? I can't quite get my mind to wrap around a goal of monopolizing exports of an entire COUNTRY.

I'll have to report back on that. I haven't done it yet.

The plan has always been to provide enough demand for a particular byproduct that no one supplier could handle it. In advance of some potential suppliers beginning production we have them commit all of their production to us. Otherwise we won't comitt to buying any of it and it becomes too risky for them.

We find every supplier in the country capable of making semi large amounts of this product and lock them all down. (That would be like 15).

 

[Greg R]

Look up fixed vs variable cost on investopedia... I like to look at my time like that too. I don't mind a fixed investment of my time, but a variable investment of my time is unacceptable to me.

Gold. +Rep for that one.

 

[inttrade123]

I'll have to report back on that. I haven't done it yet.

The plan has always been to provide enough demand for a particular byproduct that no one supplier could handle it. In advance of some potential suppliers beginning production we have them commit all of their production to us. Otherwise we won't comitt to buying any of it and it becomes too risky for them.

We find every supplier in the country capable of making semi large amounts of this product and lock them all down. (That would be like 15).

I read about your sourcing raw materials business. I do this at my day job and we do this on a slightly larger scale.

I tried to PM you, but for some reason it won't let me (probably because this account is new, for anonymity). Shoot me a PM if you'd like to chat, I might be able to help you.

 

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[Kak]

I read about your sourcing raw materials business. I do this at my day job and we do this on a slightly larger scale.

I tried to PM you, but for some reason it won't let me (probably because this account is new, for anonymity). Shoot me a PM if you'd like to chat, I might be able to help you.

No thanks. We are doing just fine.

 

[Vigilante]

I read about your sourcing raw materials business. I do this at my day job and we do this on a slightly larger scale.

I tried to PM you, but for some reason it won't let me (probably because this account is new, for anonymity). Shoot me a PM if you'd like to chat, I might be able to help you.

Lol. For anonymity?

 

[inttrade123]

No thanks. We are doing just fine.

Ok cool.

Lol. For anonymity?

I had another account on here that I made ages ago but I stopped using it because my username is part of my name and it's pretty easy to find me. Ok for talking to people but not for a public forum.

 

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[GPM]

Ok cool.



I had another account on here that I made ages ago but I stopped using it because my username is part of my name and it's pretty easy to find me. Ok for talking to people but not for a public forum.

That is a poor excuse, I am pretty sure it would be possible to have your screen name changed if you were serious about that

 

[Vigilante]

Ok cool.



I had another account on here that I made ages ago but I stopped using it because my username is part of my name and it's pretty easy to find me. Ok for talking to people but not for a public forum.

Please PM @Andy Black with your other screen name so we can combine them so you don't get booted by an IP match.

 

[Ronak]

I read about your sourcing raw materials business. I do this at my day job and we do this on a slightly larger scale.

I tried to PM you, but for some reason it won't let me (probably because this account is new, for anonymity). Shoot me a PM if you'd like to chat, I might be able to help you.

Why not share something of value publicly, just like @Kak has, you don't have to give away your identity or trade secrets, but add something to the conversation based on your position...

 

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[Kak]

Why not share something of value publicly, just like @Kak has, you don't have to give away your identity or trade secrets, but add something to the conversation based on your position...

Trade secrets are a dime a dozen.

 

[inttrade123]

Why not share something of value publicly, just like @Kak has, you don't have to give away your identity or trade secrets, but add something to the conversation based on your position...

I wouldn't recommend just jumping into something like this. If you do, you have a very long road ahead of you and a lot of trial and error.

The owner of my firm had 15 years in the industry before starting to do this.

It can be done, but you better know how to sell to big companies effectively and deal with suppliers.

 

[Ronak]

The owner of my firm had 15 years in the industry before starting to do this.

Pretty sure @Kak didn't wait for his 15 years of experience

It can be done, but you better know how to sell to big companies effectively and deal with suppliers.

So what can you share from your experience that can help anyone on the forum with this?

There are a lot of people on here that deal with suppliers and b2b customers-- you can add your perspective as an employee of a large firm dealing with this every day.

 

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[inttrade123]

Pretty sure @Kak didn't wait for his 15 years of experience

So what can you share from your experience that can help anyone on the forum with this?

There are a lot of people on here that deal with suppliers and b2b customers-- you can add your perspective as an employee of a large firm dealing with this every day.

Yeah I can, just not on my lunch break. This really falls into higher level sales/enterprise sales which I can touch on later.

The experience isn't necessary.

However, it helps a lot to know what is going on. When moving from a large company to doing it on your own, it is more akin to riding a bike for the first time, after riding one with training wheels. Compared to running around like a maniac trying to see what works.

 

[Vigilante]

Pretty sure @Kak didn't wait for his 15 years of experience




So what can you share from your experience that can help anyone on the forum with this?

There are a lot of people on here that deal with suppliers and b2b customers-- you can add your perspective as an employee of a large firm dealing with this every day.

KAK had exactly ZERO experience. Hell... I remember his first deal. He literally didn't even know what the exact commodity was (in scientific terms). All he knew is that he had a buyer/client with cash, and a seller that had the commodity.

I had a boss once (VP/Best Buy) that told me it mattered zero what the industry --- that buying and selling transactions were all the same minus the particular paperwork. The deals flow similarly. Real estate, consumer electronics, energy. You buy at a price, and sell at a price.

 

[inttrade123]

KAK had exactly ZERO experience. Hell... I remember his first deal. He literally didn't even know what the exact commodity was (in scientific terms). All he knew is that he had a buyer/client with cash, and a seller that had the commodity.

I had a boss once (VP/Best Buy) that told me it mattered zero what the industry --- that buying and selling transactions were all the same minus the particular paperwork. The deals flow similarly. Real estate, consumer electronics, energy. You buy at a price, and sell at a price.

It is. However, try starting an oil company then come back to me telling how easy it was .

I'm trying to figure out why everyone on this forum is so proud of dead end jobs when you can get a job as a sales rep at a software company or the like, be in on the deals as an employee, and then go from there.

Compared to trying to code something or run aff offers while trying to survive somehow.

 

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[Kak]

It is. However, try starting an oil company then come back to me telling how easy it was .

If you think we are saying it is easy... You completly ignored the point of this entire thread.

 

[Kak]

Pretty sure @Kak didn't wait for his 15 years of experience




So what can you share from your experience that can help anyone on the forum with this?

There are a lot of people on here that deal with suppliers and b2b customers-- you can add your perspective as an employee of a large firm dealing with this every day.

You hit the nail on the head... People who say you need to pay your dues before you're allowed to be successful are FOS.

The only dues I pay are to my country club.