E202: The $5,000 Question

This episode is a follow up of sorts to our 200th episode.

After wrapping up 5 Minute Pitch semis, my co-judges Scott Voelker, Steve Chou, Greg Mercier and I had some time to talk a bit about ecommerce while out for dinner here in San Diego.

But it’s not the usual shop talk that you’d expect. For one, Scott initiated a speed round and dropped this thought-provoking question.

“What you would do right now with all the information that you know, everything that you've gained, but you only have 5,000 dollars to start your new business?”

Unsurprisingly, each one of us had a different answer to this. I’d start a blog and get into affiliate marketing. Greg would invent a product or improve upon an existing one. Steve (who doesn’t need the $5,000) would join an online forum, become an authority figure and use that influence as a launchpad to having his own paid courses and webinars. Finally, Scott would build an audience by creating content that would target a specific or niche market.

These discussions are really something that I look forward to. Being able to bounce ideas of three of my best buddies in the industry, each one successful in his own right is always a treat. That being said, these talks bring about insights that could be useful to any up and coming entrepreneur.

I hope you enjoy this episode as much as we had fun recording it.

In other news, registration to EcomCrew Premium is now closed but, you can still learn from us through our suite of free courses. There’s a total of 20 videos covering ecommerce topics like Importing from China and Building a 7-Figure Business. Find more information on the link below.

Free Video Courses

We’re also launching giveaway during the holidays so like and follow our Facebook page for the latest updates.

Finally, if you enjoyed listening and think this episode has been useful to you, please take a moment to leave us a review on iTunes.

If you have any questions or comments, feel free to leave them below. Happy selling!

Full Audio Transcript

Mike: This is Mike and welcome to episode number 202 of the EcomCrew Podcast, still getting used to the ring of a 200 instead of a 100 number in front of everything, pretty cool to be in the two hundreds now. Episode 202 here guys. You can go to EcomCrew.com/202 to get to the show notes for this episode. Today we have a basically kind of a part two in some ways of Episode 200, but it's a different episode and different topic, but it's the same thing, same format. It's Greg, Scott, and Steve and I out on the balcony after the 5 Minute Pitch got done recording.

And this episode, I don't think we even talked about the 5 Minute Pitch. It's mostly just a bunch of other stuff about business and life. And these are the moments I think that our goal that I like to live for, being able to hang out with a bunch of really smart people and talk about business and other things. They're just amazing guys and it was a lot of fun. I think that it was pretty cool that we got to have a microphone there and have everyone in EcomCrew land be able to be part of the conversation, at least a part of the listening part of the conversation.

So I hope you guys enjoy this episode. We always throw kind of a little quick spot in the beginning of these. We're done with EcomCrew Premium for the year, so I thank everyone that signed up for that. But if you want to get some free stuff, head over to EcomCrew.com/free to get on that list there. You get a bunch of free courses. There's no credit card or any other gimmicks to get that. So just go over to EcomCrew.com/free for that. And now on with the show.

Intro: I think the one strategy that probably doesn't work is the get rich quick. Yeah, I know for myself, I always I don't take on any project unless I'm willing to do it for three to five years minimum. And so that way I don't accidentally give up early. I'm just going to do this thing.

Scott: All right guys, I'm out here on a back patio looking out at the ocean once again, with my good friends. I figured you know what, we're in town. We got to actually get together and record an episode, another episode. All right, here's what I want to do. I'm going to ask a question and this is going to be a speed round. I want to know what you would do right now with all of the information that you know, everything that you've gained, but you only have $5,000 to start your new business. What would you do with that money? What kind of actions would you take? And how soon do you think you could get to $5,000 in profit per month?

Mike: Okay, this is interesting. I didn't know what the question was going to be until you asked it. So I'm stalling for time for just one second. But I know the answer. I know the answer. Number one, the things I've had the most success with in my life is the things I'm really passionate about. If I start doing something just for the business aspect of it, of just to make money or make a business that's going to — just for the money, it doesn't ever work as well. I've had success with it but it doesn't work as well from my happiness quotient. And ultimately, it doesn't work as well, from a long term profitability, and other parts of it.

So the things I will get into will be things that mimic my life to what I would be doing anyway, things that I already have an immense personal passion in. So for me, it's traveling, I like playing tennis, scuba diving, whatever it might be, everyone's thing is a little bit different. I'm not saying backpacking is the only thing I really enjoy doing. But I would be doing something for sure that's involved directly with that. And the reason I know this now is because again, I've been doing entrepreneurship for a very long time. So I think back to when I was doing online poker, I was super passionate about poker. And it never felt like a day of work versus what I do now, even though I still enjoy what I do, it feels a little bit more like work.

And if you can do things that you're passionate about, the ultimate expertise, the subject matter expert, is you. So I would go start a blog and start building an audience. That would be my first step, because traffic and an audience and trust is always going to make you money. And now that I've done affiliate marketing, SEO, content marketing, YouTube, ecommerce, all these different things run very well to making money via that audience, and that traffic. And I would really laser focus in on doing that, and stick with it for a long enough period of time, until you start seeing that success because most people give up too soon.

Scott: I’ve got a question. I'm going to come in here. Okay, that's a great strategy. And I love that strategy. But what is your first monetization from that? And how soon would you expect to see something? If you didn't, where would you be disappointed?

Mike: So that's a great question. And I have, I think a good answer for this; because this has taken some time to like, really fully understand. I think the first monetization spot should be affiliate marketing. Use something that's already out there to establish a baseline of need, or success or purchases, whatever you want to use as a counter. They've already got the thing out there; it doesn't have to be the perfect fit. But whether it's someone else's product, physical product, course product, service, whatever, you put an affiliate link on a page, and you see people going towards those things.

You look at your entire site, and all those different pieces of data, and then the thing that's been the most successful with someone else's product is right for you to develop and make your own thing there. Again, whether it's a course or a physical product, or whatever it might be, you know that you already have a built in chance of success that's way, way over 50%, whatever it is, is probably closer to 100%. It can never be 100%, but you use those data points before you start leaping into the unknown.

Greg: My answer is going to be a little bit different than Mike's as to be expected. After watching all of the 5 Minute Pitch contestants, I'm pretty high right now on trying to invent something. So if I were to start all over, I had $5,000 to spend, which is it's a good amount of starting capital. With some smarts and 5,000 bucks, I would try to invent a physical product or make significant improvements to a physical product in an area that I would consider myself like a little bit of an expert in. And I am definitely a tinkerer and a creator by nature, and that's why this intrigues me right now.

But let's use an example. For example, I enjoy playing beach volleyball. And one of the things that we often deal with is the net gets saggy and I work around those people who have created like these ratchet straps, or they just use ratchet strap. So you'd use like in the bed of your truck, or whatever, to just like tighten down the net. And really like those ratchet straps can be built into a volleyball net. That's something that think could be created. It could be patented. With $5,000, you could definitely get started on that. And I think that's what I’d probably do.

Mike: Let me ask you a question real quick, right? If you were to take my strategy and mirror it with your strategy where you build an audience first and have people that are following you because of volleyball that's already there, it's a built in audience and then you launch that invention, that's like just fuel on that fire.

Greg: Absolutely fuel in the fire. If you have a large audience, it's pretty easy to launch anything whether that be an info product or a physical product or a software product. I don't know what other kinds of products. But creating an audience is pretty dang hard and it's a long play. I would say – one of Scott’s questions was how soon do you think you would be able to receive or have $5,000 in profit. And I think by building a physical product and starting to sell it right away; I would see $5,000 in profit before I'd be able to build up a large enough audience that I could sell them something to receive that amount of money.

Steve: I disagree. So I don't even need five grand. In fact, I had a student in my class who read one of my posts on how I made a lot of money doing a webinar. So what he did is he just ran some Facebook ads. I think he only had like 80 people and he did a webinar and he ended up making like $4,200, just like that selling, I think the content was actually the webinar or more of the webinar or more detail after that.

Greg: This is what you do, though, if you had to start all over, you'd run Facebook ads to a landing page to capture emails to run a webinar.

Steve: So I'm going to just take it. If I didn't have any money at all, here's what I would do.

Greg: You have $5,000 Steve.

Steve: I don’t need the 5,000. Some people out there that are listening don't even have 5,000. Is that right Scott?

Scott: That is true.

Steve: Yeah, right. All right, so here's what I’d do. I have a friend that did this. He just went on a popular forum. And he'd start posting these really long posts that people would read. And then all of a sudden, when people read those posts, they would comment on them, ask him questions. And all of a sudden, he became an authority within that forum. And then all of a sudden, people started asking him for advice. And he created a class and all of a sudden, people from that forum started signing up for his class, he didn’t even have his own audience or his own website.

Mike: I love all the different strategies and ideas here. And I think that they're all coming from a little bit different point of view. For me, the reason the strategy that I mentioned is what I mentioned is because at this point in my life, I'm thinking about a very long term defensible business. And I'm not concerned with the amount of time necessarily that it takes to get there. And there's obviously a much different point of view, where like, if you said, Mike, you have $5,000, and you have no home and you have no other belongings, I'm just giving you 5K, and you got to like, go out and be scrappy and survive, that's going to be a much different set of criteria.

But if I'm where I'm at now, and I'm just starting over trying to build a business for a long term defensibility and success, I would go with that strategy. If you're looking to make money as quickly as possible; I love what you just said Steve. It's like a really great strategy.

Greg: You guys might be getting off the question now though. Scott, can you remind us what the question was?

Scott: Yeah, you have $5,000, Steve doesn't need it. So he's going to give it to you. So you have $5,000, and you want to start a business that can make $5,000 in profit the quickest. That's what I'm looking at. So let me give you my answer. And I believe that kind of a hybrid of what you're talking about, Mike, I've done this. That's why I say I've learned it, it works, I can speed up the process now. Again, this won't work for you if you don't want to be an audience or if you don't want to gain an audience and if you don't want to be the front of the camera. Some people don't want to be, they just want to build a business on the back end, and then that's it. Maybe you want to be an inventor like Greg said, and you just want to be that person and just come out with a really killer product that just blows up because everybody wants it, because it's just awesome.

Me personally, it is building an audience. But the way that I would do that is I would put something out there, and in this case, I would probably do something just to get the attention in the market like I teach right now. And I would do either a giveaway in that market. I would do something to give people or get people to raise their hand so then I can deliver my content. And when I deliver my content, it’s going to be stuff around that market. So again, if it's in the bass fishing, I'm going to basically create around that market, because that's what I'm doing every weekend. I'm going fishing with — I'm not, but I'm saying if I did. I'm going fishing every weekend with my son. So I'm going to record that stuff, I'm going to report on that stuff, the lures that I'm making, all that stuff.

And in the meanwhile, while I'm doing that, I'm also going to be doing the affiliate marketing thing like Steve said, like you said. I'm going to be using the affiliate stuff, because it's the easiest way to basically make a sale without having to have a product, right? With Greg’s strategy, I like that strategy, it's going to be a little bit of a longer strategy to do to do that whole process unless we're just going to modify a little bit. If we're just going to modify a little bit, that's fine, inventing, a little bit longer of a strategy. But I agree, if you can do that, have your own product, and then you're going to also do the actual, how you're going to get the attention in the market for that thing, I think that becomes the challenge unless you have an audience.

Here is what I've learned, okay, been at this for over 15 years, whether it's for my photography business, when my wife and I built a brick and mortar business, we built a little email list of people that came to our studio, didn't even know what we were doing using like Outlook and we would just blind copy, that was our email blast. And we would sell out our entire fourth quarter photography sessions. We had no spots available, we would book solid because we built an audience.

We built an audience locally of people that trusted us, they wanted us, they didn't want anyone else, then I took it to the online space. I did the digital photography stuff there, built an audience, trust, sold stuff very easily. Build an audience, know, like, and trust, you can sell anything you want as long as the audience wants it, but you all know that. That's the easiest way for me because that's what I know and that's what's worked for me. It doesn't mean it's going to work for everyone. Greg is a little bit different.

Mike: So I mean, the one thing I want to say just about Greg strategy, you kind of mentioned it Scott, it kind of picked my thought process here. I don't know that everyone can be an inventor, and I'm going to throw myself under the bus here. I'm just not creative enough when it comes to that type of thing. I don't feel like I can be the inventor type. I can sit there and dream about this for a year, and probably not come up with an invention.

Scott: Totally. But back to the question was what would each of us do. So that's what I do. That's what I'm pretty excited about right now. I love having an audience and having someone I can promote products to. But it's not easy to build up an audience even if you're trying to go like Steve said, and create long forum posts every day and work on that all day. That takes like sitting in front of the computer and writing all day. Let's not discount the fact that it is hard work and is difficult to build up a large audience, which is part of it. But the cool thing about this and what I’m just reminded of when I was listening to everyone's, there's lots of different ways to skin the cat here, a lot of different ways because…

Steve: I just want to reference your story Greg. When you first started out with Jungle Scout, you didn't have an audience at all, right. Instead, what he did is he befriended the three of us and he leveraged our audiences to promote his tool.

Scott: Well, you know though, but he did, he more or less created a product that people wanted. Once people started using it, they started to share it. So there wasn't really much of a need for building the audience. The audience was actually being built by the want of the tool that was doing the job. So in a sense, Greg is an inventor, right? He's a creator, he's an inventor. You are as well, I mean, you've done some of your own as far as building, you love building things, you don't like spending money on tools. I'm surprised you didn't build your own Jungle Scout extension and just having it running in the background. But we've been reminded of that time and time again, although you did pick up the check the other day, which is pretty impressive. Yeah, yes, he did.

Steve: All right, first of all, guys, I'm cheap with myself not with you guys although if Greg didn't give me Jungle Scout for free, I might have developed it.

Scott: Yeah, I mean, I agree with Greg, though. I mean, there's so many different ways you can do it. That's why people are like, I tried this one thing, and it just doesn't work for me. Well, you might not have given it enough time; you might not have found your thing. I think you need to play. I think you need to experiment. I think you need to play in the sandbox and see what works for you, and understand that as you're doing this, you're learning, you're growing, you're constantly seeing what resonates with you. Not everyone wants to spend the time to build an audience or even build traffic to a blog. I think the other strategy here is take 12 to 18 months, do some good keyword research, build a blog with content that people are searching for and get traffic and then just put ads on it. Like, that's a strategy, right? You don't even have to be the front of it to do that.

Mike: I think the one strategy that probably doesn't work is the get rich quick. You got to put the work in. I mean, Steve probably mentioned the most get rich quick thing, not that I mean, with just you basically make a webinar and launch some Facebook ads to it. But if you want a business that's got longevity and going to be around for a substantial amount of time, there are no shortcuts. You got to put the hard work in, you got to deliver a product, a service, content, whatever it is, an invention that is better than what else is out there already and that people want.

Scott: Well, talking to Steve's point though, like okay, the way he described it, he made it sound like, oh, just did this, and he did that. The guy is knowledgeable on the topic. So if you're going into a place, you're being knowledgeable, you're being helpful, and then you brought people over because, like let's think about this. If I'm sitting there playing tennis, and someone comes up to me and goes hey, you want our free 25 minute lesson? I'm like, yeah. And then they show me the lesson. And I feel like oh my gosh, like this guy is awesome, he is teaching me a whole bunch things. I'm going to be like; can you give me more lessons?

That's kind of what Steve is saying. Like, he just added value. The people were like, hey yo, can you give me more. He's like, yeah, I'll teach you free, goes over to a webinar. If it's done right, it makes sense, right? But webinars have gotten so much bad rap, because there is a lot of scammy spammy crap out there on the internet.

Steve: It's not really get rich quick, either. It takes you time to develop the skills to one, find something that you can teach. And then the presentation and communication skills takes a lot of time. So it's definitely not get rich quick. I know for myself, I always — I don't take on any project unless I'm willing to do it for three to five years minimum. And so that way, I don't accidentally give up early. I'm just going to do this thing.

Scott: And that's kind of what you did with your blog for My Wife Quit Her Job, right? That's great advice man, seriously.

Scott: Yeah, absolutely. I didn't see money until the three year mark. And my mom was just telling me, dude, you got the Stanford [inaudible 00:20:07] — why the hell are you writing for a blog and making no money? And you're thinking about quitting your engineering job? So I used to get this all the time. She’s like; I'm not going to read your blog.

Mike: Yeah, well, and I'm going to say this real quick. I mean, like, I think all of us have experienced this exact thing, right? I mean, like, all of us, 2, 3, 4 years or whatever, of writing content and doing thing, I mean, Greg had some instant success with some of the Jungle Scout stuff. So like, on the more content side, I mean multiple years, right for TAS?

Scott: Oh, yeah. Well, I was going to bring up that point like TAS when I started that thing; I had started two other podcasts that didn't go anywhere. One was in fitness, and one was in just basically marketing in general. It wasn't niched down. But then I’d seen an opportunity that I could help people in a specific spot and there wasn't anyone else doing it. I didn't make $1 up until 56 episodes. 56, you know what episode that was, the one with Greg. That was when I first announced his extension. And that was my first dollar. I don't know if you knew that. Did that that you know that? That you were my first dollar? Yeah, you were my first dollar.

My first dollar I ever made from TAS was from promoting and mentioning Greg and Greg was on episode 56. That was the start of it for me. And then it kind of grew from there. But it took 56 episodes. I didn't press it. I didn't push it. I just continued to show up. I knew that I was helping. And I knew that I was helping because I was getting the reward of people telling me that it was helpful. So I knew I was onto something, right. I didn't know how I was going to monetize. Zero idea. You didn't have an idea when you started your blog?

Steve: No, I didn't get any rewards either, though.

Scott: Yeah, you see now, you had crickets, right?

Steve: Yeah, I had crickets for sure. Oh, it took me to make like $1.

Scott: Yeah, how long did you take to make $1 on that blog?

Steve: Probably a year and a half. That was through AdSense.

Scott: Yeah. AdSense, which is a lot of money you make from AdSense.

Steve: I waited a long time for that first check. This is just an aside. But if you want to see Scott, the old fitness product, just go to images.google.com and type in Scott Voelker and you'll see some interesting pictures.

Scott: Oh, going there. I'm going to have to edit that one out.

Mike: Not to toot my own horn here. But this is exactly what I was saying, write content, build an audience, eventually the money will come. There's three really good examples here with My Wife Quit Her Job, The Amazing Seller, EcomCrew.

Scott: Well, Jungle Scout has built a pretty damn good audience as well.

Mike: That was after I think. I don’t want to speak for Greg.

Scott: I remember Greg, actually, you talking to me, asking me about like, if I had someone that I was looking at that would help create content. And at the time I was like, no, I'm kind of just doing it myself; I want to look for someone. And then you just went gangbusters.

Mike: So Greg, how long did it take you to build an audience as far as the content part goes?

Greg: Yeah, I guess the plan, I didn't start with like, the plan of oh, I'm going to build an audience. That was never kind of the goal. The goal was we create this offer product that help people and then we realized they also had a whole bunch of questions. So we were just like, posting content to help answer their questions. It was never really like with the goal of like, I don't think I ever sat down at like a strategy meeting with myself and thinking and said, hey, like, I'm going to create an audience. It’s like, no; we're just going to create a whole bunch of really helpful stuff that people enjoy. And then later we put an email opt in there and before you know you start to kind of create an audience around it.

Scott: It’s a good point. All right, so anything else you want to add? I know I wanted to make this a lightning round. We are ready for dinner I think here soon. I think this is good stuff though. Like this here, this random like roundtable stuff for people to hear. After the stuff that we've been through, we've all got different ideas, different perspectives, so I want people to understand that it doesn't have to be our idea. It just has to be going out there, doing something, what do I always say, take action and do something, and see what happens.

Mike: Yeah, I think that this is gold like what we just kind of this round table, this is four entrepreneurs that have been through a lot in their lives and their career. This is the type of stuff that people pay like 10K to go to a mastermind to hear this kind of stuff. Hit repeat on this and listen to this a couple of times.

Scott: Yeah, absolutely. All right guys, we're good.

Mike: We're good. Let's go eat some food.

Scott: All right. I hope you guys enjoyed that episode.

Mike: All right guys, that is a wrap of the 202 episode of the EcomCrew Podcast. I want to thank you guys again for listening and supporting EcomCrew. Don't forget to go over to Facebook.com/EcomCrew. Hit the like button so when we do put behind the scenes stuff, you get notified and see that stuff over there. I hope you guys enjoyed this conversation, this candid, fun conversation between Scott, Steve and Greg and myself. I again, had a lot of fun doing that. Right after we got done with this conversation, we went over to a steakhouse in San Diego around the bay and had just an epic meal.

So when I was listening to this back, I was just thinking of that setting and how much fun we had with that. And also as a part of that, our production crew for 5 Minute Pitch joined us and they're amazing people as well. I actually sat down in the end of the table with them and got to chat with them and just fell in love with them even more than I already loved them. So, definitely a lot of fun and I want to thank everyone that that put all the effort into that project. I can't wait for it to come out. So all right guys, enough about all that. I hope you guys again enjoy this episode and until the next one, happy selling and we'll talk to you soon.