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Thinking Bigger: Double Your Success

entrepreneur, business, business ideas, think bigger

I recently went on a vacation during spring break to Florida with a friend and his business partner. They rented an amazing house on the ocean. The house was 8,000 square feet, had 8 bedrooms, 7 1/2 bathrooms, and an infinity pool. It was right on the ocean with surround sound speakers and climate control for every single room. It was an absolutely stunning place.

When we were there, the three women would go out and exercise in the morning. The three dads stayed back to fix breakfast for all the kids. When the ladies returned, it would be our turn to go exercise. We would start off with a run on the beach for two miles, which, if you’ve ever had a run on sand, is almost impossible to do. In between, we would do pushups.

Lesson Number One In Thinking Bigger

I dropped down to do pushups. I was going to do my normal set of 20. My friend ended up continuing his pushups even after I’d stood up. “How many are you doing?” I said. He answered, “40.” I said, “Okay. There we go. I gotta do more.”

We continue to run about another half mile down the beach, and then we make a left. We start running away from the water and I look over. It’s a gated community of all single-story ranch houses in a retirement community. I said, “How great would it have been in 2008 to have the extra capital to buy some of these?” He said, “You mean buy some of these subdivisions? Or the land to build a subdivision?” I said, “No. To buy one of these houses and rent it out.” There was lesson two in thinking bigger.

As we jogged up, we made a left on the main drag. We started heading back towards our compound, which was another two miles. In between there, we stopped and did three more sets of pushups, of which I still only did 20 and he did 40, until the last set, which he couldn’t do. I need to think bigger.

Think: When You Have An Idea, How Can You Double It?

I didn’t realize it at the time but what I thought was thinking big just got doubled. So I am going to start to think bigger and challenge myself that when I think I have an idea, how can I double that? What’s also funny is his wife, who when every time he brings up something, she always says, “Add a zero. Add a zero.” This makes total sense.

How could my other businesses in the past have been bigger and better? If I were able to double what we were doing and add a zero, we would’ve grown much bigger. Instead of a $79 a month subscription to the last company we had, what if it was $790 a month?

Going forward, I’m going to challenge myself to think bigger.

Who do you have in your life who challenges you to think bigger?

Innovating A Non-Tech Industry: Brainstorming Business Ideas

The Right Idea For The Right Industry

I’ve been looking for my next business move and/or companies to start. I’ve brainstormed a few ideas. In fact, I was sitting down with a co-worker a few months ago and he asked why I had not made a move yet. He said, “Is it time? Is it money?” I said, “Nope. It’s the idea. I have not found the right idea. I’m much more cautious now after failing and having picked the wrong partners in the past.”

Innovating An Age Old Industry

I listen to a lot of podcasts and I read a lot of books through Audible. You know this from reading my blog. Finding a need has become more and more apparent in the success of innovating a market and revolutionizing an arena to which we are already accustomed. that I have or finding an industry that is old that has not had a lot of technology. I heard a podcast by Tim Ferriss. He spoke with a guest named Adam Robinson about the ball bearings industry. That got me thinking about other very old industries.

Take a look at Uber and Lyft. The taxi industry hasn’t been changed in 50 or 60 years. Then Uber and Lyft came in and just flipped them upside down. Even the music industry, you used to have to buy physical CDs or go to the concerts to hear the music. Now you have Pandora and you have YouTube. What industry is like that? I think about making pencils or making sewing machines or what other very industrial non-competitive markets are still open.

Fulfilling A Need Is Key

To summarize, it comes down to those two needs. Either the needs that I have, or what is very old school and in a non-tech industry and could be advanced by technology.

Going back to my co-worker, I just haven’t found the right idea and I’m much more cautious with the partners that I choose. That’s why I have not yet started a new company.

Selling My First Startup: Lessons Learned

Creating My First Company

I started a company eight years ago. We grew sales for the first five years, and then it plateaued or I got bored. I kept hitting road blocks with partners, I should have been more adamant on my vision, lesson learned. It’s probably the first feeling I get when I know I need to change something or refocus on the vision. I get bored.

I started two more companies, one of which I still have. When I took my eye off the ball, it slowed sales quite a bit. What did I learn from selling my first company?

Three years ago, it was a very tough time. There was some government laws that changed, and it cut our revenue almost in half. We had to lay off a couple of people. We had to cut another person back to part-time. I started working 80 hours a week, six days a week, just like when I started the company.

We (my partner and I) also had to make up the difference between the revenue and our expenses, and so that came out of my pocket and my co-founder’s pocket. We took on a bunch of debt, in other words, we both held notes to the company.

There are many more lessons that I will be writing about soon.

Selling My Startup: What I Would Have Done Differently

When I sold the company, it was based on net income. Looking back on it, we spent the last two years before the sale paying off the debt which lowered the net income.

If I were to do it again, I would’ve left the debts on the book, financed it at 5% or 6% with a bank, taken our capital back out of the business, had an interest write-off, and would’ve had net income of four times what we had over the last two years, because of all the debt we paid down.

This was a SaaS company, software as a service. These type of companies usually sell for a multiple on revenue. During negotiations, I did not add back in, or think about, all the debt payments. These should’ve been added back in over the last two years. As a result, it would’ve accounted for “net income” or cashflow. Consequently, I should’ve taken a multiple on that, which I did not. So, another lesson is in the books.