Riding in the big boat while carrying the little boat …

There was a great article in eLance’s blog today (AJC: I didn’t know they had a blog, but I used the site to find my research assistant, Muhammad, who lives in Pakistan and is doing a great job for me at $4 an hour!) …

… here is a summary (with my thoughts in italics):

Tips for Incubating your Small Business Idea While Still Working Full-Time

Have you considered starting a business while still employed?

My Shanghai-born friend, Annie, says the Chinese have a term for this: “riding in the big boat while carrying the little boat.”

Some entrepreneurs only launch their business officially once they leave employment. However, they incubate the business concept while employed.

Other times, they actually launch the business and run it on the side while still employed. They may continue to run it as a side business for a period of months or even years. Only later do they leave their jobs.

No matter how you do it, I’ve got 6 practical tips for starting a business while you’re still employed:

1. Consider Your Employer Your Banker
I am a huge fan of bootstrapping a business, i.e., using personal money to fund growth. One form of using personal funds is to set aside a portion of your salary to fund your business. That means you need to protect your funding source — your job — until you are ready to cut the cord.

The author of this article suggests that you need to canvass your employer on ‘moonlighting’ otherwise you should wait until you leave your job to start the business – I would suggest that if the business is critical to your financial future (and, if you’re reading this blog, it probably is) then you should take steps to find a replacement job asap – and, let the new employer know that you are “working on a business ‘on the side’ to improve your business skills” … they might even see that as an asset!

2. Write a Business Plan
Sure, much of your plan will turn out to be incorrect (same goes for most startup business plans). But it’s not the plan that’s important … it’s the planning.

I agree – to an extent: as with your Life’s Purpose, having a Plan for your business is a great idea … but, trying to plan every detail is (at least for me) a waste of time … but, don’t let me stop you! If you want to see a practical approach to planning for any business – certainly, fast-moving startups – read Guy Kawasaki’s Art of the Start.

3. Get your Spouse’s Buy-In
Your husband or wife needs to be committed to your startup. If it isn’t a shared dream, or if your spouse is resentful of the time you are spending away from family, you’re adding stress on your relationship.

You want to stay married and have a business that sucks up all of your non-working time?! ‘Nuff said ….

To secure buy-in from your spouse, talk frequently about your dream. Paint a picture in words. Get him or her involved, too. Nothing creates buy-in better than being actively involved in business decisions.

4. Choose the Right Business

Here are some examples of businesses that can be operated on the side indefinitely for years, or eventually taken into full-time businesses:

  • Software development
  • Web design
  • Freelance writing
  • Online businesses
  • Graphics design
  • Consulting
  • eBay business
  • Event planner
  • Any hobby that you can turn into a business

The author recommends these because you can often be flexible in hours and/or hire outside staff/contractors … the catch is that a number of these businesses aren’t dramatically scalable, which is the #1 criteria that I look for in a business …. remember: scalable = salable.

5. Set Aside Dedicated Schedule for Your Startup

Many entrepreneurs who have successfully started a side business do it by setting aside dedicated hours each day for their startup. I’ve known budding entrepreneurs speak about going home to “start the second shift.” That’s exactly how you have to think of it. Commit to spending X hours per weekday and/or on weekends on your business. Stick to a regular schedule – it makes it easier. P.D. James, the novelist, worked for years as a hospital administrator, arising early to write for 2 hours each morning before work.

This is the best piece of advice in this already excellent post … it is hard to come home from work, only to have to go to ‘work’ … but, it must be done (hence, the prior discussion with spouses and bosses).

6. Turn Your Employer Into Your First Customer
Think of your employer as your first big sales target (assuming your product or service is relevant to your employer). Many a business has gotten off to a great start when the owner’s former employer became the first customer.

Good luck on this one! Still if you CAN get your employer to become your first big customer, it’s a great start: not sure how the whole employee/supplier co-existence thing will actually pan out … I think it will be better if you are able to transition from employee to supplier

If yuor objective is to build a second income stream to support your investing activities – or, perhaps to build up capital to start That Big Business of yours [AJC: I would never let a little issue of capital stop me from starting that one NOW 😉 ] – then this article provides some great suggestions …

… however, if you want to build a ton of money, fast, then you may have building the next Facebook in mind and this article (along with this one) presents a way to get off the ground with minimal risk.

Some financial advice for the blogging community …

Casting Call




Click Here

 OK, I am a relatively new blogger … I obviously don’t do it for the money [AJC: no advertising, affiliate links, or product sales here!], but many do … or aspire to.

And, as Alex recently commented on this post, there’s nothing wrong with blogging for money:

If people like Guy Kawasaki, Dilbert’s author, and other wealthy people all put ads on their site to make money, then there’s no reason why we should not. John Chow is making $30,000 month off his main blog so there is always an opportunity to make money through your blog.

It is these Mega-Bloggers who are paving the way to [apparent] riches for the rest of the blogging community …

… but, as far back as 2006 there were already 50,000,000 blogs [holy sh*t!], growing by a mere 17,500 new blogs a day!

So, how is Joe Average Blogger actually doing? Check out this chart:

Blogging Income 

Source: Problogger 

Problogger does a regular survey of their readers to see what they earn; now, this isn’t a scientific survey by any means but it does seem to give a useful indication of Blogging Earning Potential.

For example, 28% of respondents don’t earn ANY money from their blogs with another 18% earning only a pittance!

Problogger says:

A quarter of those who earn something make less than 0.33 cents per day. If that’s not a reality check then I don’t know what is.

Of course, we will categorize these bloggers not as losers, but as new bloggers who are steadily winding their way up to the giddy heights of those who earn $100 – $499 per month … and, maybe even beyond 😉

Even so, this doesn’t mean that blogging is a futile exercise in self-indulgence … right?!

Of course not … it just means that you need to seriously assess exactly why you want to be in blogging:

1. Is it for strictly non-financial reasons?

ReadWriteWeb said in a recent post:

There are many different motivations for blogging and some do not involve money. Some people have a cause they are passionate about – they want to help change the world and a blog is a marvellous way to get attention for that cause. Others don’t even want to change the world or get noticed, they are just passionate about something and enjoy writing about it – attention is a by-product.

These bloggers may have Adsense ads and Amazon affiliate links. Who wants to turn away “no effort” money, however small? Just don’t judge them by their revenue, it is a by-product

2. Is it mainly for financial reasons?

I have some advice for those bloggers who do have at least some serious financial motivation:

Blogging – if pursued mainly for its potential monetary rewards – is a business, and a pretty competitive and limited one, from a strictly financial standpoint, at that.

Like any other business, it takes: commitment, planning, execution …. and, more than a little luck!

The very few guys who do make it Blogging Big (if you call $150k – $250k p.a. earned income ‘big’) probably started early in the game, and put serious effort into growing their business.

This COULD be you … but, here is my suggestion, just in case the odds don’t favor you:

i) Blog because you want to – look at the monetary reward as a bonus

ii) Blog as a form of networking – use it to build an audience for a future product or venture (e.g. a book)

iii) Blog to build content – ‘package’ your posts into an e-book or information product that you can sell

iv) Blog to provide a little extra fuel for your investment strategy – even if you are earning just a few extra dollars a week, doing something that you enjoy, put at least 50% towards your investment strategy and compounding will take care of the rest.

v) Blog because you want to combine all of these strategies … that’s the best way to get benefit from such a usually low-dollar-per-hour-invested activity.

To me, blogging is probably a bad ‘business’ in strict return-on-time-invested terms – I would never pursue it as a business; so many other activities have the potential to return much more and scale much better … and, who the hell are you going to sell it to, anyway?

But, the ‘financial’ value of blogging (if that is the path that you are pursuing)  is that you may be able you use it to eventually drive higher-dollar-per-hour outputs, elsewhere.

For the guys pursuing the blogging-to-earn-money angle, that makes blogging a great marketing tool, pure and simple!

A great example is Jason, who also left a comment on that same post:

I am using my blog to make money, but not in the way you may think. I am using it to establish the fact that I am an expert in specific areas….then when I talk to my investors I can show them the articles I wrote and how it all works. Basically to give credibility.

Next I also use the blog to sometimes promote my computer company. I have not received any sales. but it is a hope … the main thing I use it for is motivation, so that I keep going on my path to being wealthy.

So, what about me?

I may accept advertising on my blog one day … I may also write a book … but, like blogging, that is a relatively low-expected-value activity.

In the meantime, I will keep blogging simply because I enjoy sharing what I have learned in the Financial School of Hard Knocks … I have important information stored up inside me that is simply better out than in!

What about you?

I'm about to find out if you can make money online …. Part III

Note: In the original version of this post, I included links to the actual sites; WordPress has posted what looks like an ‘automatic warning’ … on the assumption that this content was the cause, I am removing the actual names/links … a pretty good ‘early warning sign’ that the site that I subscribed to is a bit dubious, huh? 

I have a confession, I am already working on two separate on-line ventures that are currently in stealth mode but, these are fairly high-risk / high-reward ventures … they take a lot of preparation, programming, and money.

Which is why I am busy trolling the Internet for a more ‘off the shelf’ business that I can try, so that I can prove to YOU that it is possible to make money on-line. Why?

Because I want you to start a part time business to increase your income. Why?

So that you can invest at least 50% of that extra income to accelerate your savings plan. Why?

So that you may eventually become rich!

So, I’ve found a ‘promising’ candidate … if this doesn’t work, then I’ll just have to come up with my own idea, I guess …

It’s a glossy-looking, well put together web-in-a-box diet program. I guess that it’s designed to pull people into an affiliate program for a so-called “World-Famous TV Lady Doctor“.

Is this as scam? Probably

Do I expect to make any money out of this? No.

Then why? Because I’m hoping (in the unlikely event that it’s not a scam) to at least make a ‘little money’ to show that it is POSSIBLE to make money on-line … to prove that it’s at least possible.

If this doesn’t work (which, I’m fully expecting!) then we’ll go to Plan B …

OK, so here goes; the site says to take the following steps BEFORE signing up (well, putting up some roadblocks before asking me to hand over money is a good sign!):

A) You will need a domain!

We recommend http://GoDaddy.com Once you’ve secured a domain (or if you already have one) you will point it to your webspace!  

B) You will need webspace (i.e., hosting).

 We recommend http://HostGator.com They have 24hr Support — so if you need assistance at anytime, they’re there to help you PRONTO!  

C) You will need a ClickBank account — don’t worry, it’s Free!

 Just go here to grab it N0W! … http://tinyurl.com/   

D) You will need an Autoresponder — Here’s the BEST one on the Net with 98% successful “deliverability!” …


And once you have all those things (which altogether probably will cost you less than $50 bucks!) you just need to click here to order now for JUST $397 (1-time payment ONLY!): 

…. that’s it …. wish me luck! I’ll keep you posted …

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Making Money 101, 201 and 301 principles applied to your business!

Writing this blog sometimes puts me on mailing lists that I don’t recall subscribing to …

But, I am usually pleasantly surprised by what I see (if not, the <delete> key is a quick’n’easy solution) … so, I am usually quite happy to see some ‘surprises’ in my in-box (please don’t send me Viagra ads or other spam!).

An example of a ‘pleasant surprise’ was an article from Leigh Ann Rodgers of Creative Business Workshops called “Where does your business stand financially?” In it she said:

 In February when I pulled together all my financial information for taxes, I had an “ah ha” moment. I spent too much on my business last year! My profits would have been much higher if I had been more conscientious about my spending.


Here is how you should look at your business …

… exactly as you would yourself!

That means that your business also goes through three stages:

Making Money 101 where your business is struggling to get ahead; not making as much as it should.

You need to apply exactly the same money-saving and budgeting techniques as you would for yourself. Here is what Leigh Ann recommends:

It hit me like a ton of bricks, that I need to apply these same [Making Money 101] principles to my business. I need to budget each month and only make purchases that I can pay cash for. I must admit that I have sometimes been a little loose when making purchases for my business, rationalizing that I could “write it off.” Now, I am thinking about every penny I spend.

 I agree … 99%.

But, you should NOT be stingy about any expense that DIRECTLY helps you grow your business (that means that you can track the $1 that you spend today to at least $2 to $3 earned within your current financial period, say, no more than a few months to a year).

Because it is this thinking that will take you into:

Making Money 201 – where your business is doing better than breaking even … now it’s full steam ahead!

You are saving money and watching costs, sure. But, you have realized that there is something that you can – and should – be doing that produces a far better result than mere cost-cutting …

… that is, accelerating your income!


Cost-cutting is limited in scope … you can’t cut more than 100% of an expense.

Income-earning is unlimited in scope … the sky – nay, the stars – are the limit!

But, when the income is the greatest, you need to watch your costs even closer because bad habits – leading to hidden gotcha’s – creep in.

It is the Making Money 101 habits that will help you survive the increasing drain on your cash-flow that uncapped growth can bring.

If you do, may be one of the lucky ones who ends up in:

Making Money 301 – that idyllic stage where the business is floating in orbit, spinning off cash, controlling costs and just being … well… damn profitable!

Watch out for stagnation, though, because this is where product life-cycles wind their course, competitors come in, commodity pricing appears.

The secret to Making Money 301 is NOT to sit there for long … either:

1. Put yourself back into Making Money 201 – new ideas, new products, new markets, go off shore, become a franchisor … OR

2. Sell! 

But, it all starts with a business that survives the Making Money 101 stage … unfortunately, the odds are against you.

But, Leigh Ann has a great Making Money 101 tool to help you out:

Here is her Where do I $tand Worksheet

Why don’t you try it out?

Calculating your Investment Net Worth

I found a site that I really like; it’s called Net Worth IQ and it’s a social network around calculating (& sharing if you feel so inclined) your net Worth.

 To be conservative in calculating your Net Worth, you should LEAVE OUT:

a) Any ‘equity’ in your house that you NEVER intend to release as investment (i.e. borrow against for purchasing, when the timing is right, income-producing-buy-and-hold-investment-real-estate).

b) Any supposed ‘equity’ that you have in your business.

Let’s call the result your INVESTMENT NET WORTH …

 It’s the only one that matters!


Well,there are only TWO reasons to even bother calculating your Net Worth:

1. To ensure that your ‘portfolio’ matches the Rules of the Rich (e.g. the 20% ‘rule’ on home equity that I talk about in a recent post), and

2. To check whether your INVESTMENT NET WORTH (which should be in passive income-producing investments by then) can FUND your ideal retirement with at least 99% chance that your money won’t run out before you do.

I must confess that for the purposes of the Net Worth IQ site … I broke those two rules, so I should lower my Net Worth by approx. $2.5M, and I may make that change later – I haven’t decided yet.

BUT, I have already done the calcs and am acutely aware that my INVESTMENT NET WORTH can EASILY fund my retirement starting next year (I’ll be 50 … now, that’s old, Man!).

If this makes sense to you … check out some Tips that I have already left on that site and this blog.

Now, what’s YOUR Investment Net Worth … more importantly, can it fund your IDEAL retirement?

A sure fire plan to long-term wealth if you are a student or just starting young …

If you are a student, you have one of the greatest assets available to you … time!

It means that you can succeed with a ‘get rich slow’ program (whereas, most of the rest of us can’t … not enough ‘runway’ left).

Just how important is ‘time’? Just take a look at this example taken straight from the Investment Company Institute‘s web-site: 

The following graph shows three investors, each of whom invests $1,000 a year until age 65. However, one begins at age 25, investing a total of $40,000; one at age 35, investing a total of $30,000; and one at age 45, investing a total of $20,000. Each earns 7 percent per year and, for purposes of this illustration, the effects of taxes and inflation are ignored.

The Power of Compounding

Source: Investment Company Institute

So, if you are happy to ‘get richer than most people but slow’, here’s a super-quick 4-step program for you just because you have time on your side:

1. Get debt free … pay of those credit cards and student loans (if interest rates are super-low on these AND you like a bit of risk, keep the loan and buy and investment property instead) … look at the debt snowball for a neat debt-reduction strategy?

2. If you are hell-bent on investing in stocks stick your money in a low-cost Index Fund (it’s what Warren Buffet suggests) … if you prefer owning direct stocks, then read a book called Rule # 1 Investing by Phil Town.

3. Try and save for a deposit on a rental property (or your own home … but, it’s better to rent/own than own/own) – both real-estate and finance is cheap right now; buy and lock in for 30 years.

4. If you want to accelerate your results (i.e. ‘get rich quicker’), you need to focus on accelerating your income … start a part-time business (for you, Internet-based might be ideal!?). IF you make money, put at least 50% of it towards 1., 2. and 3.

If you do this early enough … then you just may be able to kick-back and enjoy the ride!

Save your way to a fortune? I don't think so …

You’ve read the blogs … you’ve bought the books … you’ve talked to your financial advisor (your wife).

They’ve all told you that you need to pay yourself first! So you are … 10% of your gross salary !

You’re putting some aside in your 401k (with some employer match) and you have a little change going into the cookie jar next to your bed.


You’re already doing two-and-a-half times better than what CBS News calls ‘most people who only save 4% of their salary”.

But …

… it won’t make you rich!

It will stop you from being poor and may even fund a retirement if you start early enough and are willing to take a 30% pay cut.

The problem is, you can’t just save yourself to the retirement of your dreams on the average salary … you have to at least earn more and save most of the extra.

Look at it this way … the amount you can save is limited …

… limited to less than 100% of your salary, and for most people, limited to something between 0% and 20% of their salary.

But, the amount you can earn is only limited by your imagination and your capacity for hard work.

Here are some examples of ways that you can increase your income:

– Change jobs (maybe)

– Work longer shifts (yuk)

– Ask for a payrise (why not?)

– Take on a second (third?) job (horrible)

– Join an MLM ‘opportunity’ (do your homework carefully!)

– Renovate some houses (now may be the time to get back in)

Start trading some stocks (better know what you’re doing?!)

Start a business ‘on the side’ (my favorite!!!)

Whatever you choose: Start Small … Finish Big!

The point is not how YOU should do it, the point is you CAN do it … if you are prepared for some hard work and sacrifice now for a better future. Are you?

If you keep paying yourself first at only 10% of your current salary in your day job, and 50% of the additional money that you earn (after paying off debts), THEN …

… you just may retire RICH!

Let me know if you think this can/can’t work for you …

I'm about to find out if you can make money online … can you?

I’ve made my money in real world businesses, real world property, and real world ‘paper assets’ (actually, I think I’ve lost more than I made in speculating the stock market!).

But, I have a theory that the internet is the new ‘wild west gold rush’, where people can lay a stack to some turf and mine for internet gold without outlaying much cash.

It’s only a theory right now, so I am launching two internet businesses (one is being developed right now, and the other is still in the business plan stage) … on paper, they both look good! I’ll let you know in a few months how they turn out …

But, those businesses require development skills, business planning skills, etc.

 What about the ‘average Joe’ who just wants to make some money part time? What about all of those ‘get rich online’ ads that you can find just by googling keywords like ‘money making opportunity’?

Are they GENUINE or are they SCAMS?

Well, I’m about to find out …

Yesterday I randomly searched the net and came up with this ‘opportunity’ (yes, it really is a half-naked guy named ‘Ty’):


The first thing I was asked to do was pay $50 ‘application fee’ to prove that I am ‘genuinely interested’ and a ‘go getter’ … smells a bit fishy, huh? … so, what did I do?

I paid it!

After a barrage of e-mails and a conference call invitation that I missed, I got a link to the page in the image above. I’m listening to the audio right now … I think they want me to pay $3k to join a multi-level marketing system to sell memberships to some exclusive travel club.

I’m told to “… Embrace the fact that you are surrounded by a team of leaders that care about you and are going to show you exactly how to bring it all together. Your life will turn around and you will succeed!!

What will I do? I don’t know yet … but, I’ll let you know … right now some guy on the audio is telling me “it’s the best thing that I’ve ever done in my life” … do you think the half-naked guy really has something?