Just Do It

April 3, 2007

Nike has it right.  Just. Do. It.

I’m embarking on a new venture.  My first partner has worked out so well that I am going to seek out one partner per week, every week this quarter.  If I can get to 12 partners, with enough work to give each of them, then I’ll really be onto something.  I have proven that I can acquire more work than I can do myself, so now I am going to see if I can acquire more work than I can effectively communicate to 12 partners, and that they can complete.

Because building a business is about building a system, I am going to be implementing or finding a solution for all of the following:

  1. Centralized source code control
  2. Centralized project resources (all information about a project available in one web based repository)
  3. Automated notification emails for #2, 4
  4. Streamlined partner payment processing.
  5. Streamlined bidding (partner specific)
  6. Expanded bidding targets; diversification of project types
  7. Knowledge base, including an existing code base
  8. Collaborative assistance between the various partners

Last month, I had one partner working with me and he grossed $2,000, on which I made $563.21.  Assuming I can maintain a 25% margin on each partner, I would need to acquire about $30,000 in work per month.  I have $30,900 worth of work stacked up as of this moment, so I don’t anticipate that being a problem, particularly if the partners allow me to diversify the projects that I can bid.

Now. Just. Do. It.

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Read The E-Myth

April 3, 2007

I read this book, and I highly recommend it.  At the very least, you’ll get another perspective on running a business.

For programmers, I feel the book is especially good because it caters to our natural intentions — creating a system to handle complexity.  The strongest point of the book is that you should create a system to handle your business.  You are selling that system, both to your customers and to people who would acquire your business.  It also covers some common mistakes.  For those reasons it’s worth the two evenings it’ll take you to read it.

March Earnings

April 3, 2007

Net earnings:   $8,236.01

Net Earnings from Guru.com:    $ 2,360.00

Percentage thru Guru.com:   28.7%

Gross Earnings:    $ 9,782.80

YTD Gross:      $25,382.64

YTD Net:         $23,025.85

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Analysis:

This is a decent earnings month.  I netted enough to pay the bills, and had a decent gross as well.  I am trying to setup some more relationships with external contractors so that I can get more of the work I have done faster, and also bid more work.  There are literally hundreds of jobs per week that I am letting slip through my grasp.

The Guru.com percentage is artificially low because a lot of my revenue came from 3 clients that were each directed to me by people I know.   I would expect it to be closer to the 80% range most months.

———————

Notes on previous months:

In February, the net was $3,786.25, but the gross was actually $200 higher.  Not a big correction, but the difference between gross and net is worth tracking.

In January, the new was $11,003.59, but the gross was$11,613.59.  Again, not a large correction, but worth noting.

With these things in mind, because I added a partner in March, it appears as though my gross is growing, but faster than my net, which is to be expected.  I am curious how much work I can do (gross) and how much of that money I can keep (net).

Help Calms

March 7, 2007

Having help is an incredible thing.  If you know that you aren’t the only one who can do something, or that will do something for your business, it is an incredible relief.  It’s backup when you need it the most.  If you own your own business then you should look into getting some backup help as soon as possible.  You can get it in either your core competency, or in something you just hate doing.  Make sure you manage the people who are helping you, but try not to get in their way either.  I am finding subcontracting to others to be the best thing I have done for my business in the year that I have been working on my own.

If you want to be the CEO, then you have to have employees, or at least business relationships with other contractors and businesses to fulfill the needs of your customers.

Another thing I learned this week:  always do a follow up.  If you bid a job for somebody make sure you are doing some kind of follow up with them.  They may not pick you for this contract, but they are going to remember the level of service you deliver.  In my case, I locked in two contracts that were in question by making sure that I did adequate follow ups.

February Stats

March 4, 2007

Per Job Income: $ 1,328.75

Total Income: $3,786.25

Refunds: $0

Job Completed: 3

% of Jobs from online sites: 100%

February was a great month for big projects and progress. It was a horrible month for collecting money because of those big projects that are not yet done. I am expecting March to be significantly better than this because of the effort I made on projects I’m going to get paid for in March. I have ~$7,500 worth of projects that are incomplete, but that I will get paid on in March. This month is bittersweet; long hours and late nights characterize this month, but not a lot of money collected. It’s kind of depressing, so I am concentrating on how much I am going to make in March to cheer me up.

January Stats (belated)

March 4, 2007

Per Job Earnings: $1,935.60

Total Earnings: $11,313.59

Refunds: $300

Jobs: 6

% of Earnings found through online contracting sites: ~73%

All in all, I consider this to be a good month. It’s not my best ever, but it’s a really strong month to start the year and puts me in a good position from a cash flow perspective.

I been giving this question a lot of thought: “What makes an entrepreneur different from an employee?” In my not so humble opinion it’s only two things, money and cast iron balls. The entrepreneur has some amount of each, in fact everyone has some amount of each. It seems these things are multiplicative, you can be successful if you have a lot of money, or if you have a lot of balls. It’s good to have a lot of both. I believe there is a threshold above which entrepreneurs operate. Employees simply don’t have the required combination of balls and money. It’s a simple equation.
(Balls)*(Money) >= Threshold

On a related tangent, I believe that this threshold can change, and that people can change. Someone who might start out an employee can become an entrepreneur later in life, or even do so concurrently in different parts of their lives (hence all the microISVs out there).

With this formula in mind, the implication is that anyone can be an entrepreneur, even the very poor, as long as they are willing to take risks. Also, it implies that you can grow your risk tolerance, possibly through taking more and more risk as you get bigger and bigger opportunities. It seems the people who would be best at attacking this problem through sheer balls would be the people who have the least amount to lose, or basically people who have just graduated from college and have yet take on large fiscal responsibilities, as suggested by Paul Graham.

Long story short, Nike was right, Just Do It.