I can honestly say that my one of my strongest passions in life is business. More specifically the early stages of business. The genesis, and creation of something tangible from basically nothing. Although I am not anywhere near what I would consider a success yet, I feel I’ve accumulated a ton of knowledge and experience from my many failures and few successes throughout my professional life. I think many of my friends realize this as well as they always come to me with their business questions and are always more than happy that I give them my $0.02.

So this brings me to this internal debate I’ve been having with myself for the past few months. I want to start a podcast series about entrepreneurship and the process of starting a business (focusing on web based) from the ground up. In this series I would cover my thoughts on the changing business environment, how the internet is changing everything, resources, book reviews, inspirational interviews, etc.

I basically want to help as much people who want to start something of their own live their dream life.

What’s Holding Me Back?

Well basically three things.

1. I am embarrassed by the fact that although I feel I know what I am talking about, I still don’t have the proof that I do. I haven’t hit a homerun in business yet and I wonder if its too early for me to start talking business without having anything (financially) substantial to show for it. Right now, I have many theories/beliefs about what works, what doesn’t what’s important but I’m only now beginning to validate or invalidate these ideas.

2. I honestly have no idea what people want to hear about. There are many things that I’ve learned along the way that I guess I’ve taken for granted. I recently had a skype meeting with a few friends of mine who are looking to launch a new website. The questions I thought there were going to ask were completely different from what they actually wanted to know. They were asking things that I honestly thought everyone knew, but when I took some time to think about it, no not everyone does know these things. Questions like, “What legal things do I need to form a business?” or “How do I get payments online?” I’ve learned such a long time ago, I forgot that when I was first starting, I didn’t know where to start either. I think many things I don’t even think would be good topics are exactly the type of things people want to hear about.

3. My plate is becoming increasingly full. Although we’ve brought on some great people to help with the workload at Ukulele Underground, The projects we are launching will take up a lot of time. Not only that, Eatkauai.com still has a long way to go, and the record label needs at least 1 project this year. I also have some client work I need to finish up and a lot of other people who are asking me to design and create their website. I’m worried about spreading myself too thin with yet another project. It’s always been a bad habit of mine to not finish things that I start. It’s a habit I’m trying very hard to break.

So That brings us to this…

This project is something I think would be incredibly fun for me as I can honestly talk for hours about business if the party on the other end will bear it. I do have my concerns though, so honestly I would like some feedback so please leave a comment if you think its a good or bad idea. I’ll be mulling it over and hopefully by the end of the month, I’ll have made my decision if I’m going to do it or not.

One of my biggest problems is remaining focused on my current project. I think it’s a problem that many entrepreneurs deal with. I’m constantly seeing problems around me and thinking up solutions to these problems. For the most part, I’ve done a good job of keeping myself focused. I’ll launch a side project here and there and let it die. Getting them up at least lets me tell myself, ok you did that one get back on track with whats important. That is usually good enough to put out these fires I get.

This new idea however is something that I really think is needed here on Kauai. It’s the first project that I’m attempting that is targeted towards Kauai as it’s market. It’s a problem (not a very serious one mind you) that I encounter probably weekly, and I’m sure others encounter even more. I thought of the idea back in the Summer and after suffering some analysis paralysis, I’m going to start this one this tomorrow and hope to have an early beta ready to go by the weeks end. I hope people on Kauai find it useful and help me grow it into something special because I think if completed, it can become something that benefits everyone that lives here.

I’m also going to document the steps I take with this project here on my blog so others can see how I go about developing and launching websites. It’s probably pretty boring but hopefully some people find it interesting.

More details to come. I know this is horrible timing to do this with Christmas coming up but that’s how I am. When I get the desire to do something, I usually do it as soon as possible (Which is probably why I am G1 in Street Fighter 4, no self control I tell you).  Now if only I could figure out a way to solve my Christmas present buying problems ….

I’ve been doing my own businesses off and on for almost 5 years now and while I am no where near what I would consider a success (yet), I have learned a lot from my previous failures. There are many common mistakes first time entrepreneurs fall victim to. I see the same pitfalls over and over again. I’ve decided to start a new series of blog posts documenting some of my boneheadedness in hopes that it other new entrepreneurs won’t be as dumb as me.

Mistake #1 – Chasing Money

Why do most people want to become entrepreneurs or have their own business? For most people, the answer is easy; they want to make more money. Sure, they’ll come up with a long list of other reasons to make themselves sound better, I want to be my own boss, I want more free time, I want to be in control of my career, etc all that is fluff to cover the fact that they want to make more money. They want more money so they can have more free time, buy the things they want, do the things they want, basically they think that their current situation, their lack of happiness is the result of not having enough money.

There is nothing wrong with wanted more money, but starting something with the sole purpose to make more money is a broken proposition. This is the idea that drives people to multi-level marketing “opportunities”, opening franchises or buying an existing business. This is why 9 out of every 10 businesses in America fail. Money CAN NOT be the #1 priority for your business.

There is a reason why this is a very common mistake. It is counter intuitive to general thought. Start a business to make money. This was my way of thinking before as well but through experience my view of business is now this,

Start a business to create positive change.

When you do something strictly for the money, you often tend to chase the hot market. For example; Green living and eating organic is very hot and buzz worthy now. To many it may seem like a good idea to get into this market, people are interested in it, so you will probably have customers. Well, the truth is, if you only want to sell things like that because it is hot, you will most likely fail.

1. You will not know enough to sell the products effectively with confidence.
2. You will grow frustrated dealing with a customer base that you cannot relate to.
3. Your customers will not be able to connect to you because you have no passion for the product and you see them as numbers.
4. You will end up hating it because it becomes just another job.

Fortunately for me this mistake only cost me around $1000. In 2007, when the real estate market began to tank, I became very interested in real estate investing.  I was growing tired of my job as a web designer and I saw it as a great opportunity to make some big cash. I joined a local investing club in Honolulu, devoured podcasts and internet material on the subject and spent some serious money on education in the field. In the end, I had a couple deals fall through, and made $0 in real estate.

The truth is, the businesses that have the highest chance of success are the ones built on passion. Something that you would do anyway, even if you weren’t paid to do it. This solves all 4 of the problems I stated above.

1. You will know more than anyone trying to compete with you
2 & 3. You will love your customer base as they are the same as you
4. You would do this even if you weren’t paid!

See how it works. Follow passion, don’t chase money. Money is a measuring stick that gauges if you are doing the right things. What is your measuring stick reading?

Business is not easy. If it were, everybody would do it. Living your dream life is not easy, if it were, everybody would be living theirs. The only difference between those who are successful at business or life for that matter and the people who aren’t is successful people choose to be successful.

Choosing to succeed is more than just stating emphatically you will. Choosing to be successful is consciously embedding the belief of success deep into your soul. So deep that no matter what external factors may come your way, the belief remains there untouched and burning bright as ever. You continue to march towards your goals regardless of outside interference.

There will always be bad days, thing you don’t want to deal with, people you don’t want to deal with. These things in life are inevitable and unavoidable. Often you find these things might bring you down and question if it is worth it. The top of my blog says Business = Passion and this is the way I view business in general. The only businesses I believe even have a shot at making it work in this new web enabled society are the ones that are created out of passion. Being passionate about your work already gives you a much stronger desire to succeed. Choosing to follow your passion is the choice to be successful.

Unfortunately following your passion often attracts the most negativity from people who cannot understand the concept. People by nature are adverse to change. There is a certain comfort in routine and daily rituals and change, even if it is not there own scares the majority of the population. Like crabs in a bucket, they will try to pull you back down to their level. The best way to combat this is to take each dose of negativity you receive as a personal challenge. They are challenging your belief in yourself and you owe it to yourself to prove them wrong, to defend your dream. If you cannot believe in yourself enough to do this, you’ve already let them win.

On Wednesday, March 11 2009 I lost one of my few business heroes. Charles “Mask” Lewis Jr, founder of the Mixed Martial Arts lifestyle brand TapouT passed away in an early morning car accident. While some may feel it necessary to critique the way of his passing, I choose to remember the life Charles chose to live and why he will always serve as a huge source of inspiration to me.

TapouT was founded in 1997 by Charles with an initial start up capital of just a few thousand dollars. Launched out of a small unfurnished San Bernadino “apartment” (a room in the back of someone’s house), he would drive a borrowed car to small regional MMA shows and sell the few t-shirts he had in the parking lot out of his car trunk.

The landscape of Mixed Martial Arts was very different back then. Senator John McCain strongly opposed the sport calling it “Human Cockfighting”. He championed the cause of outlawing MMA and sent letters to the governors of all 50 states asking that legislation be put into place banning the promotion of these events. McCain was successful in 37 state and almost all pay-per-view providers pulled the UFC, from their programming. Because of this, many of these local shows Charles, later accompanied by Dan aka Punkass and Tim aka SkySkrape would attend with their TapouT apparel were hosted in Native American reservations.

There was no reason to believe that MMA would become as huge as it is today, but Charles, Dan, and Tim, believed in their hearts that the sport would overcome it’s opposition at the time. They had a passion for the sport and what they were doing. They felt it was something that was needed. People would call them dreamers, idiots and retards for essentially banking their futures on a sport which would most likely be gone in a few years.

The three forged on with Charles as their leader. They worked hard getting their brand out there, Dan fulfilled online orders as Charles and Tim drove to local shows selling their inventory by any means necessary. With no marketing budget, Charles, a lifelong comic book fan created alter egos for the crew and thus he became “Mask”, Dan became “Punkass”, and Tim became “SkySkrape”. They would go to shows dressed in outlandish costumes emblazoned with the TapouT logo and became the center of attention wherever they went. They began sponsoring fighters when no one was sponsoring fighters. With so little money this was difficult for them to do in the beginning, but they did whatever they could. Jeff Sherwood from sherdog.com tells a story about how Charles asked him to take a huge duffel bag of TapouT gear to a UFC show with one of their sponsored fighters Scott Adams. Before the show started, Scott went into the crowd and sold every t-shirt in the bag. The few hundred dollars from those sales was his sponsorship money.

Through their hard work and dedication, TapouT generated $30,000 in revenues in 1999. The three were ecstatic. In 2008, TapouT generated over $100,000,000 in revenues.

With Ukulele Underground, I frequently looked to Charles’ story for inspiration. No one gave a crap about MMA or TapouT but they pressed forward because of the passion they had. People called them idiots, dreamers, and they were able to prove all the doubters wrong. More than the money, I looked up to these guys because they were able to provide for themselves by doing something positive for something they really loved.  When looking at their story, it made me feel like we could do it too.

A month or so ago I had the idea of somehow getting in touch with Charles to tell him how much he inspired me. I knew he would know more than anyone what it feels like to do what we are trying to do. With Ukulele Underground, there is no doubt that it will be something huge. It’s never a question of if this is the right thing that I should be doing, the feeling is just there. I know he would understand the elation we feel after each victory no matter how small, and the excitement of inching your way towards a goal.  Somehow I convinced myself not to try yet because Ukulele Underground is still so tiny and it would be a waste of his time. That telling someone like him about an Ukulele website is something he would laugh at. I told myself that I would contact him when it wouldn’t be a waste of his time.  I wish I had sent that email or placed that call anyways. Now I’ll never have that chance.

Tapout.com has a mini-documentary and Charles last interview up and I would recommend everyone to watch it. Also, sherdog.com has a tribute radio show to Charles which, although it is heartbreaking to listen to, it will truly give you insight to how great person he was. His was a life that is worth celebrating. Rest in Peace Charles Lewis Jr.

Ukuleleunderground.com has given me the opportunity to meet and befriend so many amazing people throughout the world. I always take some time everyday to think about just how fortunate I am to have made so many new friends within the past year. One of these new friends is a man named Mike Hater from Nashville Indiana. Mike is an amazingly interesting person. He has described himself to me on more than one occasion as a hillbilly.  His youtube channel is filled with videos of him tending to his bee hives, or sitting on old tractors drinking moonshine and strumming an ukulele.

Mike recently found himself out of work and decided it was time to start his own Ukulele Company which he named Mainland Ukes.  Having worked in the industry and been an avid player of the ukulele, it seems like a logical progression. For all I know this is his first foray into entrepreneurialism but he has done so many things right so far it seems as if he has been launching businesses his whole life. Crazy thing is, I don’t think much of it is pre-meditated or planned at all. He just does these things because it makes sense to him.  He’s doing things that so many larger companies who are stuck in their ways will never understand. Mike is 42 years old and does not even own a cell phone, yet he understands how to use the internet for business better than 99% of the people I’ve ever personally talked to. Whether he knows it or not, his business should be studied on how to launch a business with limited capital in the 21st century using the internet.  Let me break down what he’s doing and why he is bound to succeed.

1. He is a part of his business’s community – Mike is an avid ukulele player. He’s worked in the industry helping put them together. He loves playing them. Because of the fact that he already has a passion for the ukulele, he joins internet forums about ukuleles and talks to any other enthusiasts all over the world. He joined the UU forums over 1 year ago, way before starting an ukulele company was even a thought in his mind.  Because of this, Mike, or Hoosierhiver as he’s known everywhere online already has some personal brand equity. People know him and when they found out he started a uke company, they checked it out.

Why is this important? There are billions of websites online. Billions of people trying to convince you to give them your hard earned money on the internet. Who do you trust? How do you know if it’s a scam or not? These days a website is simply not enough. So many people make the mistake of thinking that launching a website is the end all be all of web marketing. You could not be more off the mark. Getting in the trenches, interacting with your potential customers, is the fastest way to gain trust online. You need to give your customers as many ways to reach you as possible. They don’t want to talk to an answering machine or a secretary, they want you.  Trust is not something that should be expected, it needs to be earned.  Because Mike was in the trenches, sharing info, befriending other uke players from around the world, when he announced that he started his new company, he already had a few people that were willing to give his ukulels a shot sight unseen.

2. He has a great product – New ukulele companies seem to be popping up all over the place. Not only that, guitar makers like Fender are now seeing an opportunity to cash in on a growing niche market and are putting out ukuleles of their own. One might look at the marketplace and see oversaturation. So many of these ukuleles are being made overseas, why create another line that is just going to get lost in the crowd?

Mike has an advantage. Because he is a part of the ukulele community, he knows what a good ukulele should sound like and what features ukulele players are impressed by. His ukuleles feature things like high quality covered geared tuners, and real bone nut and saddle. He strings them stock with a more expensive brand of strings. Theses are features that help make his ukulele look and sound better than most other ukes at his price points. When those early adopters who purchased his ukes got them in the mail, they were all blown away by the quality of what they had just purchased. What happens when expectations are exceeded? They all came back into the forum singing praises for these Mainland Ukes  they got from Mike. This lead to more sales from more members. Word of mouth marketing is the most powerful form of marketing, it’s free and spreads like wildfire.  To start that fire, you need to have a solid quality product that exceeds expectations.

3. He Sponsors the Longtail - Advertising online is still a mystery for many businesses. Many fail to see the value in it especially if they are coming from traditional media outlets. The numbers for online viewership are almost always smaller than TV and Radio. Conventional wisdom would say, why even bother?

Before he even launched his company, Mike was e-mailing us saying he wanted to purchase advertising on ukuleleunderground.com. He understood that for his market, there was no better way to reach his potential customers and that ROI for his advertising dollar was highest sponsoring a site like ours. When you sponsor the longtail in your industry, you’re essentially piggybacking on existing brand equity. You create brand awareness and in most cases online, if you sponsor a company that has a strong connection to their visitors, people who see your ad will at least check out what you have to offer. It’s why I personally have tried Sweet Leaf Tea, why I’ve used godaddy to register my domains even though there are cheaper alternatives, why I tried netflix, why I signed up for Raffstar, the list goes on and on. Sponsoring the longtail is a shortcut to building your own company’s brand equity.

4. He didn’t give up - When Mike decided he was going for it and was going to start his ukulele company, he e-mailed us to ask if he could advertise with us and that he wanted to work with us to create a signature ukulele model. His e-mail was ignored. At UU we have a strict policy on who we let advertise on our website. We feel that if we vouch for these companies, then they better bring straight thunder to our visitors and members. We turn down many advertising solicitations because we feel their company would not benefit our members, most usually never get back to us.

Mike was different. He e-mailed again asking the same thing, in fact I think he e-mailed a few times before we finally got back to him.  Always polite but on point. We told him that we were working with another company to create our signature ukulele. He left the door open for us if we ever wanted to take him up on that offer. We eventually allowed him to purchased some advertising and he sent us an ukulele to give away and for us to take a look at what his company was producing.  When we got the ukulele, we were blown away by all the features he was offering. Once again his product exceeded the customers expectations. After a quick meeting it was decided that we needed to be selling his ukuleles in our store and that Mainland Ukes was the company to make our signature ukulele as our previous deal had fallen through.  We added Mike’s ukuleles to our store today and will begin marketing them heavily in the weeks to come. He’s happy and we’re extremely happy with the arrangement as well.  All this because he refused to take ‘No’ for an answer and was professional about it. In business, especially when you first get started, you’ll face rejection a LOT. It can be soul crushing but never giving up is more than half the battle.

Where does Mike stand now? Well he officially been in business for less than a month and he’s already having to place a reorder for his instruments because he is starting to run low. If he continues to create quality products and deliver quality service, there is no doubt in my mind his company will only become bigger and more profitable as time goes on.

Links:

Check out Mainland Ukes and say hi to Mike

Though I haven’t had one yet, I can imagine growing a business is very similar to raising a child. Not so much in the physical pain experienced by the mother at birth, but in the sense of the commitment and dedication required to grow and nurture both. There an initial excitement when they’re brand new. You find yourself staring at it saying to yourself, “wow, I made that!” You devote countless, often thankless hours in the hopes you are helping them grow up right. You take pictures when they reach milestones. You worry about other people hurting them. You do your best to protect them. When they fail, you feel like you failed. All the while, you constantly are wondering if you’re doing this right.

This morning (well actually yesterday morning, it’s past 12 o’clock) around 3:45 AM I woke up and went to my computer. I don’t know why I did, I just had a feeling that something was wrong. There was a blinking IM box from Seeso in Chicago, one of our mods for UU. We had been hit hard with spam and he was trying to delete them all but he didn’t have access to some sections. We began working together, banning all the accounts that he had identified. As I banned, more registered and posted spam posts. We kept deleting more spam posts, the other mods began to chip in. I eventually upgraded the software in hopes that that would be the fix, it slowed them down, but they still were registering and posting spam all the way into the early evening. It was the largest, and worst spammer attack we’d ever experienced to date. I banned well over 50 accounts in one day.

Sure I was pissed. I was pissed at those spammers for trying to ruin the experience of the UU forum members. But never for even one second did I ever think to myself, “Man I don’t want to be doing this.” At 3:50 am all I could think about was taking care of the members and making sure they didn’t notice too much of the spam.  It was like noisy neighbors waking up a baby and the baby starts crying in the middle of the night. You’re not pissed at the baby, you’re pissed at the noisy neighbors.

I’m actually very blessed in the fact that UU has grown the way it has. I don’t consider any of the people on the site a customer. To me, they’re all family, which makes it quite difficult to explain to people who run traditional businesses. I try my best to really get to know as many of them as possible. I care about what they’re going through, and I often find myself just checking up on them on myspace or facebook, just to make sure they’re doing ok if I haven’t seen them on the site for a while. At the end of the day, it doesn’t matter though if other people get it or not. People who are a part of UU get it. There is really the feeling that we’re all in this together and we’re growing this ukulele movement as one. I’m lucky, instead of just me and my partners doing it alone, it’s more like a village raising this child. And this Baby is going to grow up to be HUGE.

Mike Michalowicz have very quickly become one of my favorite people on the planet. His book ‘The Toilet Paper Entrepreneur‘ was released today and let me tell you folks, it’s going to be HUGE. I was fortunate enough to receive a pre-release copy from Mike and talk to him on the phone a couple of weeks ago and I have never in my life read a book that has resonated more strongly with me and my beliefs about business.

You may be thinking to yourself right now, “What the hell is a Toilet Paper Entrepreneur, that sounds gross…” Well the premiss of the book is simple; you don’t need a lot of money to start a business, all you need is a passion for something and a plan to get to where you want to be. The allusion to Toilet Paper comes Mike’s approach to using your available resources. What would your game plan be if you were stuck in a public stall with just 3 sheets left on the role, your pants around your ankles and your dirty deed in the bowl beneath you? Would you just sit and complain, beg for help from an empty room? Or would you figure out a way to get yourself clean and out the door. (actually that is kind of gross… haha)

Lack of money is one of the most commonly used excuses for not starting a business. TPEs (Toilet Paper Entrepreneurs) believe that is actually an advantage because it forces you to be creative, to think of ways to get things done with what you have.

Why do I love this book so much? It’s real. It isn’t some theory or half baked pseudo-motivational advice book. The book presents real solutions for many problems I’ve personally encountered in my past businesses. I told Mike after reading it, “If only this book had come out 4 years ago, I would have saved myself a lot of time and money learning these lessons hard way.” Not only that, the book provides the framework to continue from your initial company launch all the way to you end goal whatever that may be. I’ve begun implementing some of the framework he provides in the book into my business and the results have been outstanding.

If any of this sounds interesting to you, I recommend you check out Mike’s website: toiletpaperentrepreneur.com . You can pick up a copy of the book there, use the coupon code FREESHIP to knock off the shipping and handling charges. You could also get it on Amazon but from what I’ve heard, they already sold out of all the copies they had.

I’ve met with many entrepreneurs and one of the first questions I almost always ask them is, ‘What is the goal of your company? What are you trying to accomplish with your business?” It shocks me when people respond with, “The goals is to make money.” Let’s get one thing straight, if the sole goal of your company is to make money for yourself, you will fail.

In business, no matter what business you are in, you must have a goal to help other people in some way. The goods or services you provide must enhance the lives of your customer in some way. If you can’t do that, you do not have a business.  Whether it be, what’s for dinner, buying a house, or help learning how to play the ukulele, at their core, all businesses solve someones problem. Demand is simply problems that need to be solved. If you’re not out to solve someone’s problems, you’ve got a company that has no demand.

Be honest with yourself and your idea. Will this product or service truly benefit others, so much so that they are compelled to tell everyone they know about it? If you can answer yes to that question, you may be on to something.

Gary was (and still is!) a big inspiration to me when I was stuck in a rut late 2007 trying to figure out why I was so miserable and what I should do with my life. His passion for life showed me that there was absolutely no reason I should do anything that I did not love. The more I hear him speak or read things he’s done it just gets me fired up all over again.

For the uninitiated, Gary Vaynerchuk is the Director of Operations at Wine Library, a retail wine and liquor shop based in New Jersey and the creator of Wine Library TV, one of the hottest video blogs on the internet.  He is quickly “changing the wine world” with his unique approach to wine and how you enjoy it. While in middle school he had a lucrative trading card business, pulling in $1000 every week at card shows, only to be forced to give it up and  work in the family business, a liquor store, for $2/hour. In his early 20s, he grew that liquor store into Wine Library, a $50M retail company and one of the largest independent liquor distributors in the United States. Upon turning 30, in his own words, “he freaked out” and began doing Wine Library TV which has lead him to appearances on Late Night with Conan O’brien, Ellen, The Big Idea, and Mad Money.

He is a strong believer in finding your passion and executing on it. His approach to business of passion first, is a concept that has resonated strongly with me and lead me to eventually leaving my job to dedicate more of my time to my companies. A decision which I do not for a second regret.