Friday, 8:14 a.m.
Today I want to introduce you to a new concept that I think will change the way you think about entrepreneurship.
First a brief history for those who aren’t long-time readers of this letter.
I started my first company in 2009 at the age of 30. It was a trading education company that taught aspiring retail traders how to make money in the currency markets.
It might be more accurate to say we helped people learn to follow a set of rules that produced a positive expectancy. Meaning the longer you follow the rules the more money you stand to make.
When I started, all I wanted to do was make enough money to quit my job as a military contractor.
I was living overseas 6-8 months out of the year and with a young daughter at home, I didn’t want to watch her grow up through a laptop monitor.
But as the money started to come in I quickly began to have dreams of grandeur. I pictured myself at the helm of a multi-million dollar, transnational company. (Ego can be a real son-of-a-bitch.)
But that’s what you’re supposed to do right?
If you’ve got a good thing going the next step is to scale it up!
That’s what all the business gurus say.
So I leased some office space downtown. I hired my first employee, then a second. Before you knew it we were making even more money.
I was waking up at 4:30 each morning and driving 45 minutes into the office.
I’d work until around 3 p.m. then head home to beat rush hour traffic.
I’d play with my kids for a few hours and then at 8 p.m. when the kids went to bed, I’d work from home until around 10 p.m.
I was exhausted, detached from everything that wasn’t business. The company became the only thing that mattered.
I told myself it was all for the family. To provide them with a better life. A life I never had. But in truth, I was a man driven by wealth and status.
Two years later when our lease was up I moved us out of our 1,500 square foot loft office and into 6,000 square feet of newly renovated office space.
By this point, the company was making millions. But I was burning out.
So I decided to take some pressure off myself by hiring three more people, bringing the total number of employees to 10. But it didn’t help.
Now I had a machine that had to be fed. At its peak, the company needed to bring in $50,000 a month just to cover overhead and payroll.
Imagine starting every new year knowing you had to earn $600,000 before you got to keep a penny. That’s where I was.
Things went along like that for a few more years. I tried to make changes to improve our processes. I created some systems to make things run more smoothly. I even hired a COO to run the day-to-day operations.
Ultimately the company collapsed under the weight of my hubris and incompetence.
At the time I was devastated. I thought about all the things I could have done differently that might have saved us.
But the more distance I put between then and now, the more I realize that I wouldn’t have wanted to save it.
I was miserable. I was 25 lbs overweight, I worked all the time and my only ‘friends’ were the people who worked for me.
I thought my business was going to be the vehicle that set me free. A ship that could carry me to a world where I had unlimited control over my time and money.
Instead, it became a prison from which I could not escape.
I Think We’ve Got Entrepreneurship Backwards
Today my life is very different.
I’ve taken my knowledge of how to grow a digital business and I teach it to folks like you. Helping them avoid the mistakes I made.
I have no employees or part-time contractors. It’s just me working out of a home office.
My revenues are a fraction of what they were at my last company. But I still bring in hundreds of thousands a year.
And with a profit margin of 96% or better I’m pocketing almost the same amount of money as I made running that multi-million dollar headache.
I’m happier, healthier and have a better relationship with the people I love.
That’s what makes me think we’ve got entrepreneurship backward.
We think if we just build it big enough, eventually we’ll get to a point where the business runs itself and we’ll get to sit back like a chess master moving pieces around on a board.
But for 99% of entrepreneurs that dream is nothing more than a fantasy. Building bigger doesn’t create more freedom. It creates less.
Having a fat wallet means nothing if you never get to enjoy your wealth because you’re busy putting out fires all day.
A Truth Bomb from the E-Man
Earlier this week I was watching an interview with Elon Musk. He said something that hit home to me.
He said, (and I’m paraphrasing) …running a business isn’t fun. If things are going well they don’t require your attention. So the only things you work on are the problems. And if you hire really smart people, the easy problems get solved without your help. So you spend all of your time trying to fix the problems that smart people haven’t been able to solve.
That is the life of a 21st-century entrepreneur. And it shouldn’t be that way.
Introducing Entrepreneurial Minimalism
What would happen if we stopped making “growth” the central objective of our business?
What if we stopped using vanity metrics like revenue, units sold, number of employees, or community status as the primary measure of success?
What if instead, we focused on two things?
Time Freedom and Income Mobility.
What if, before taking any action as entrepreneurs, we asked,
“Will this decision increase the amount of time I control?” And “Will it also create more income that can go with me no matter what I decide to do with my time?”
If I can encapsulate Entrepreneurial Minimalism into a single word it would be Autonomy.
But what does it mean to be autonomous? Like success or happiness, autonomy isn’t a destination. It’s more like a scale from zero to 100.
So to get an understanding of what I mean let’s look at the extreme. Let’s assume we have Total Autonomy.
I would define that as the ability to do:
- What you want,
- When you want,
- Where you want,
- With whomever you want,
- For as long as you want,
- Without considering the cost.
It’s a bit of a pipe dream. No one ever gets to a point where they never have to answer to anyone.
But by using this extreme, wouldn’t it be fair to say that the closer we come to the ideal of Total Autonomy the happier and more fulfilled we’ll be?
Getting to spend your life doing work you find fulfilling, with people you admire and respect sounds pretty good.
Understand I’m not suggesting you sit around all day and do nothing. We have plenty of examples of what happens when you lead a meaningless life without direction. (Just look at your average trust fund baby.)
I’m talking about having the time and money to work solely on the things that fill your life with purpose. Having the income mobility to travel and live as you see fit. A life of true independence.
A life where your business supports your lifestyle instead of the other way around.
But Entrepreneurial Minimalism requires a complete paradigm shift in thinking. It requires us to leave our egos at the door and forget most of what we’ve been taught about running a “successful” business.
For the Entrepreneurial Minimalist, a successful business is one that:
- Doesn’t require you to trade time for money.
- Can be run without employees or contractors.
- Is easy to scale up or down.
- Doesn’t require the owner to be in the same place all the time.
- Has (almost) no overhead.
- And provides an income beyond the needs of its owner.
A form of entrepreneurship that places time freedom and income mobility ahead of growth.
Most people would tell you that’s impossible. But I’m living proof it’s not.
So let me ask you…
…Do you want a business that becomes your life or do you want to enjoy living?
If it’s a life you’re after then you’re going to have to throw out everything the gurus and “successful entrepreneurs” tell you to do.
But let’s face it, do you really want the life of a typical entrepreneur?
The Truth About Traditional Entrepreneurship
A recent study by the University of California found that 72% of entrepreneurs report suffering from a mental health problem.
From anxiety to depression to substance abuse.
That’s a very different picture from what most “Hustlers” promote online.
If you’ve read this far that statistic shouldn’t shock you. What shocks me is that it’s only 72%.
Your business should be a playground, not a prison. Yet for the majority of business owners that’s exactly what it’s become.
I chose a different path. So can you.
If you’ve already started your company and reading this letter has been like a punch to the gut, rest easy. You can still course correct. It’s not too late.
And if you haven’t started your company I’d encourage you to choose the path of Entrepreneurial Minimalism. You’ll be a lot happier, healthier and wealthier if you do.
Over the next few months, I’m going to be writing more about Entrepreneurial Minimalism and how you can start building the kind of life I’ve just described.
The balance of 2023 is going to be exciting. 🙂
Until next week,
If you enjoyed this newsletter there are 2 ways I can help you:
1. If you’re looking to start or grow your solo business I’d recommend my Bootstrapit Program. It walks you step-by-step through the process of identify your unfair advantage, create your product and getting your first sale.
2. f you have a successful business but you’re feeling burned out and frustrated then it’s time to start building the systems into your business that will free you from the day-to-day grind: check out my Business Growth Accelerator