I remember when I first learned how to ride a bike. I was eager to ditch the training wheels and hit the road (okay sidewalk). So one day we removed the training wheels and my Mom held onto my bicycle seat as I got my balance right. I slowly moved forward, picking up speed, and then she let go and I was off. There I was riding around our apartment complex in Parsippany, New Jersey. It was probably one of the first times I actually felt free.
Of course one crucial thing was left out in my bicycle 101 course from Professor Mom, she had neglected (or perhaps I had not listened) to teach me about brakes. It was a simple back-pedal brake, but for me the idea of “going backwards” with my feet was unnatural. So I just continued riding around in a circle while my Mom chased after me.
Then it started getting dark. Since I couldn’t grasp the pedal brake; I decided that a crash landing was in order. I slowed to a moderate pace, leaned in to my left, and crashed into the grass. I incurred some minor scrapes, a little crying, but it worked. In the morning I’d learn the importance of brakes (I actually ended up needing to crash land a few more times).
I did a bit of adult crash landing recently when I sold my first successful business on Flippa. I wanted to share some things with everyone that I had learned about running a small bootstrapped business and selling it.
Just because something doesn’t do what you planned it to do doesn’t mean it’s useless.
– Thomas A. Edison
Keep business and personal life separate
Don’t use your personal email address or personal phone number for your business. You don’t want your customers knowing your personal number. You end up sounding unprofessional when you answer a call because you don’t always know who’s calling. If you ever sell your business, you will have former customers calling you for weeks, which is annoying. You can buy virtual numbers that route to your cell phone from places like vumber. I would use Twilio since it has an awesome API that lets you do things like have greetings, queues, etc…
Regarding email addresses you really want to use something like email@example.com for all your registrations. This makes handing these accounts over to the new owner much easier. Otherwise you’ll have to fill out forms and contact support for numerous third party vendors to change things over. It’s cumbersome and really, your business shouldn’t be linked to you personally like that either. I’d also recommend using a PO Box instead of your home address and paying for a private domain registration as well.
Make it easy to get rid of your partners
When I setup this business I did so with a partner. We created an LLP and things went sour rather quickly. I’ll spare bashing on the guy too much (this deserves its own blog post), needless to say he didn’t have what it took to make the business succeed. I know that when I go into a business I am going to do my best. My intent is to kick ass and make rapid progress. Your partner might not have this same attitude as you. So you will want a plan in place to get rid of them as easily as possible.
I had no plan in place, so I had to pay a sizable amount of money to achieve 100% ownership. This sucked and it made me bitter, very bitter. What I would do in the future is have a contract written up that allows for arbitration to take ownership of the company if one side is not fulfilling his or her obligations. It should also have a buy out clause in case one side wants out, through no fault of their own. If your partner is unwilling to sign this, then they are weak and untrustworthy. So this is probably not someone you want to do business with anyways. You’re the boss, act like one, and protect yourself like one.
The entrepreneur always searches for change, responds to it, and exploits it as an opportunity.
– Peter Drucker
Forget about SEO
If your business can’t make money without being number one in the SERPs then its probably not a good business. Business that relies solely on where it ranks within search engines just aren’t for me. Rather than spending my time making a great product my focus becomes SEO. Google doesn’t validate my business, its just a search engine. I rather concern myself with how my customers view my business and focus on beating the competition with my product instead of links and ranking factors.
Know when to sell
I sold my business during the holidays. This is probably not a great time of the year to sell a site on Flippa. People may have money tied up in Christmas, getting ready for taxes, or they might even be on vacation. I think I lost out on money by selling during the holidays. If I could do it over again I would have waited until after the New Year.
Know how to sell
I probably didn’t do the best job with my posting at all. I left out tons of assets from the description: facebook likes, twitter followers, mailing list. I also didn’t explain everything the software I wrote did: reporting, features etc… I didn’t spend enough time describing how well it managed the process or why my business model is an easy sell to customers or what problems it solved. This probably cost me some additional money. Furthermore, Flippa shouldn’t have been the only place I tried to sell my business. The Flippa market place shouldn’t determine the value of your business, but if that’s the only place you post it then it will.
All in all it was a good experience. After trying numerous ventures over the years I finally bootstrapped a moderately successful one. That feels good. I learned a lot about managing a business, what to do in the future, and what I should have done differently. And you know what? I feel a bit free again.
The majority of men meet with failure because of their lack of persistence in creating new plans to take the place of those which fail.
– Napoleon Hill