TheMikeODonnell

3 Months! Once again it’s been way too long between blog posts. Normally when I go this long without writing, it’s because I’ve gotten way too caught up in the hustle bustle of business and life. However, this time I think it’s just because I have gotten lazy. All of my morning routines have completely broken down, I’m sleeping in most days until after 8am and I’m working significantly less hours than I used to. Part of this is due to me delegating my managerial responsibilities to my new manager so I need to find new things to work on. Most of it is definitely due to experiencing so much success over the holidays. Doing huge sales numbers each day is actually having an inverse effect on my work ethic because the sales are just coming in anyways so why wake up at 6am every day. Either way, I need a reset so I can get on top of my game. With this said, I am utterly amazed at how much progress I’ve actually made in this last quarter. It’s a constant reminder of how important this blog is and how short my memory can be if I don’t take the time to reflect on my accomplishments.

Breaking Up With Jarod

Just like the news, let’s get the bad shit out of the way first so we can end on some high notes. This is one section that I’m actually glad I didn’t write about while I was in the middle of it because I would have just dragged on for pages about all of the ridiculous details of what happened.

As you will recall in one of my previous posts, I decided that after ASM 5 I was going to slowly pull away from Jarod. Keep the relationship intact, but no longer work with him because of differences in core values. In September/October, ASM decided to launch again for the 6^th time. After the ASM 5 shenanigans, Jarod and I had both decided that we were no longer going to promote to course anymore.

A few weeks before the course launched, Jarod reached out to me and mentioned that he was not going to publicly promote the course, but he had a few close friends and family that wanted to get in. He asked me if it was cool if he brought them in under our affiliate membership so they could access all of the trainings. I had built all of the training in our membership myself, but I also knew that I had no hand in curating these leads so I didn’t think a 50/50 split on the commission would be fair to Jarod. Instead, I offered to take only a 20% commission split for the privilege of them going through all of my training videos and guides. Jarod agreed with me that 20% was fair compensation and everything was good.

Everything was quite on the home front until the ASM pre-launch videos start. All of the sudden, I’m receiving emails from Jarod from ASM Elite promoting the course. He’s using the email list of a couple thousand people that we created together over the past few launches to promote the course to the public. This is way different than asking a few friends and family because now he is using a shared asset that we both built. I called him up and kindly explained that 20% on friends and family was cool, but if he was planning on a full public promotion using our list and the bonuses that I put together, then I would certainly want to split 50-50 on those new members.

Jarod’s response to me was that he talked things over with his wife and he thought giving me 20% was now too much and that he was going to promote the course using our bonus package. So to recap, Jarod now wanted to use the list we built together to drive traffic to the bonus package I built to sell the course and then dictate how much he wanted to pay me.

Without tooting my own horn too much, Jarod didn’t have the intellectual capacity or the business acumen to create his own trainings to match what I had built, but he needed that level of content to sell the course. As we went back and forth, it became clear that Jarod was making a move to steal my content and use it to sell the course without paying me for it.

I had backups of everything on my computer because I had created it all, so I went into the website and youtube accounts and deleted everything I had personally created. I left all of Jarod’s stuff alone, but made sure that there was no way he could swipe all of my content. I forget the exact time frame of events at this point, but we agreed at this point to split up and leave everything else intact. I was happy that my trainings couldn’t be swiped and for the sake of the members of our group we would keep everything else we co-created available for them.

Jarod planned on starting his own Facebook group and I made a post in our joint group that we would be shutting down on a set date in the future and that everything would be migrating over to Jarod’s new group. We agreed on this together and I fully endorsed everyone moving over to his new group. Everything settled down, but after about a week went by, Jarod must have reconsidered things and he decided to boot me from access to everything and he made a move to take over control of the main facebook group. Lucky for me, I was the one that originally created the facebook group, so I had trump power over him. After he booted me from everything else, I ended up kicking him out of the Facebook group. Even though he once again struck first after we came to an amicable solution, he now resorted to his all too familiar pattern of threatening legal action and trying to trap me in a libel scenario.

At this point I was extremely fed up with all of his bull shit. I normally have much more tact than this, but I decided to make this post in the Facebook group to let everyone know what had been going on:

I’ve removed Jarod from the group. We agreed to have a smooth transition, but then he went ahead and changed all the passwords on me.

There’s a reason why Shane stopped working with Jarod and there’s a reason why I have also stopped working with him.

For me, the decision actually came after the ASM5 launch. As you may remember, we ran into some affiliate policy violations during the ASM5 launch.
We didn’t intentionally break the rules, but it happened and for short periods of time our affiliate account was suspended. In business and in life bad things happen. It’s inevitable. Most rational people realize this. What truly matters at the end of the day is how you handle yourself in the face
of diversity.

Jarod took the short term view of making threats and trying to trap people in potential law suits while I tried my best to settle things like men and have real conversations with people to work things out. Unfortunately, since we were a team, my reputation suffered as a result of his actions. It took me
a while to rebuild my reputation, but I did.

I decided from then on that I wouldn’t be working with Jarod anymore because he didn’t share the same values as I do. We were still completely cool and  there were no burned bridges.

The reason we are in the situation we are in now is because Jarod decided he was going to promote ASM6, use all of the bonuses that I put together, and dictate to me what he was going to pay me.

The fact is, the listing optimization blueprint, the launch formula, outsourcing training, all the operating procedures, The 100K per month business infrastructure, costing spreadsheet, manufacturer batch analysis spreadsheet, product research training, the sales letter, our entire affiliate marketing strategy, and a bunch of other stuff I’m probably forgetting about, were all created by me.

Outside of the software and some very Google-able info about patents, almost the entire bonus package was the product of my mind.

I’m sure he has backups of most of it and will repackage it as his own. I can’t do anything about that and I’m ok with it because business grows and changes over time.
At the end of the day, he’s not capable of creating that level of new training on his own. He still has a full time job and his business is nowhere near as advanced as I’m sure he has led you to believe.

I don’t care about allegiances or any of that stuff. It can only benefit you to join his new group as well if that’s what you want to do. He’s much more hands on than I am anyways.

He wants to build a community that he can sell software services to in the future. I run a physical products business and don’t have any “plans” for what this group will “bring me” in the future. I enjoy all the posts in this group, sharing updates of my own, and watching you guys grow in your businesses.

So I’ve decided to keep this group open.

It’s a shame that things had to end this way between us. I really wish my original plan of slowly pulling away and keeping the relationship in tact would have worked out. Unfortunately even an amicable solution wasn’t in the cards for this one.

Let’s move on to some more rapid fire updates and big wins for the quarter

File Sharing Transferred Over To Sync.com

As our team has grown and we have added more processes in place, so has the amount of data storage we need. My free dropbox account was reaching maximum capacity, so I start researching all of the best enterprise level cloud file sharing solutions. I tested quite a few, but ended up going with Sync.com as our new solution.

Here are a couple of the main features that I really liked:

• 500gb of storage
• Synchronizes across all devices
• Company is based in Canada so it is outside the reach of the NSA
• HIPPA compliant data privacy and encryption
• Access control and user levels for who gets to see what

Sync has been an absolutely phenomenal software so far and it was an easy transition for everyone on the team to make. With the extra space and extremely high level of encryption/security, I’ve been able to take the majority of my important data off my laptop and into the sync cloud.

My laptop was backed up by carbonite, but now I have redundancy between both carbonite and sync as well as the ability to access any important files from any computer in the world versus needing my specific laptop. To put things into perspective, we went from using 16.5gb on Dropbox to now using 205.2gb on sync.

Building Out The Foundation For Traffic Data Analytics Company Wide

That sub title is probably a little too flashy for describing data analytics, but essentially that’s what I’ve done.

My problem arose when tracking events across multiple platforms. It’s hard to link up traffic data when you go from an Ad to LeadPages, then Leadpages to Amazon or Email to Amazon and try to accurately attribute conversions and cost per acquisition data. Let alone when you add another wrinkle in there of different ad copy on different platforms, generating the initial traffic. It’s just a mess when you are comparing the analytics on multiple platforms and none of the data matches up.

So I signed up with a software called ClickMeter, that essentially allows you to create tracking links and attribute them to various campaigns. The cool part about these tracking links is that from just the link itself, you can inject retargeting, conversion codes, utm parameters, and a whole bunch of other really cool tricks that can keep all your data from each platform contained in one single analytics area.

So after setting up ClickMeter, I had to go and switch out all of the links everywhere so we could start accurately tracking everything. As of right now, we have 76 tracking links across 10 different campaigns and over the last 30 days they have been clicked on 4,340 times. I didn’t have time to properly manage all of our paid advertising campaigns, so outside of Amazon ppc all paid traffic is now paused. That means across our organic content we are generating 4,340 visitors per month. That’s pretty damn good.

To be clear, I have not yet built the automated reports that will break everything down for me and pull all the data together into a strategic spreadsheet that I can make decisions on. But at least the infrastructure is there so when I have the time to tackle this bear of a project, I can pull it all together.

Here are a list of the current campaigns we have in there:

• Barbecue Recipe Book: Tracks all traffic specifically coming from our free pdf giveaway of the recipe book as well as our new hardcopy version. Info about the hard copy version is later in this post
• Bonus Pages: How many people follow the links on the insert cards in our packaging to land on our bonus pages. Can compare this to orders per month per product to figure out the exact conversion rates of our insert cards
• Email Funnels: All the analytics from the email funnels we have. I’ll go into our new email automations later. This data is going to be invaluable when I give context to what we are doing email wise now.
• Advertising Channels: As discussed above, will pull the advertising statistics from FB, Pinterest, Youtube, Google Adwords, etc into one analytics dashboard so we can measure effectiveness
• Iris Isaguirre: All the traffic generated from the 300+ Youtube Videos and overlaying ads we have. Iris has a personal set of links she uses to promote everything so I can track sales and traffic data directly attributable to her
• Janna Estrada: Janna is our new social media manager. Again, she has her own set of tracking links so I can measure effectiveness of all organic social media traffic.
• Pinterest: Measures all organic traffic coming into our funnels from Pinterest images we post
• Review Clubs: We are building our own list of Reviewers by directing them over to us from AMZ Tracker. This is against their TOS obviously, but I have structured it in a way that we have plausible deniability if they catch us so we won’t be shut down. Building a list of $1 reviewers is a huge asset.
• Vanity Funnel: All traffic from each stage in our vanity funnels. This will make more sense when I review our marketing strategy overview later in the post

As I said, right now we are just accumulating data in here. When I get the chance to tackle the spreadsheet that will crunch this data, I expect to be able to take one look and have the ability to make strategic decisions on every area of our marketing strategy in a few minutes each month.

Cost of Goods Sold Analytics

I mentioned in one of my previous posts about how I now have the ability to see analytics on all of my manufacturing data. This data however was isolated on its own tab in my financial spreadsheet, which meant that I always needed to manually update my COGs on my pricing tab to make sure it was up to date.

The reason it worked this way was because sometimes you may have inventory in stock from 2 different manufacturing batches and I needed to manually update so I could use the most accurate costs. For example, say I purchased 1,000 units at $5 apiece and then purchased 2,000 units at $4 each. My inventory in stock is 2,500 units, so until I sell 500 more units, I need to use the $5 figure in my calculations. Now, all I need to do is flip a switch to say which batch is the active number and it will automatically update over to my pricing models.

This switch removes the human error that occurs with manually updating everything and it makes a huge difference in the ease of calculating pricing strategies. Especially as I add more and more product lines to the mix, this spreadsheet update will give me the ability to quickly scale

Producing a Print Version of The Recipe Book

Over the past few years, I’ve looked into publishing the recipe book as a physical book multiple times. Each time I attempted to tackle the project, I backed down because reformatting the pdf version was such a pain in the ass to do.

Well, I finally took a couple days of dedicated work and made it happen. It took a bunch of time to retype and format everything, but we are now selling the recipe book in physical form as well as a pdf download. As you will see in the marketing strategy overview video, the recipe book is now the most crucial point that all of our marketing efforts revolve around because it funnels traffic into all of our product funnel (highly underutilized asset that will be maximized once I get a dedicated ppc person on board).

I looked at a bunch of books in my library when I was designing the cover graphics and decided that I needed to have testimonials on the back cover to provide credibility for the book. Instead of collecting testimonials from our customers, I decided it would be a cool idea to acknowledge some of the friends and family who have really supported me the most with Cave Tools over the years. On the back, I put testimonials I collected from my Aunt Eileen, Uncle Jack, Matt Budenstein, Aunt Peggy, Tina Ahn, Justin Lee, and Zach Hirsch. As soon as the book was finalized, I sent each of them a free copy of the book as a way of saying thank you for their support.

My favorite part of the entire recipe book publishing process was the idea I had for a dedication page. The way the book laid out on paper originally was that the table of contents was on the right hand side of the book. Usually you start the table of contents on the left side, so I needed one extra page before it so I could push it over to the left.

I started out writing a typical dedication along the lines of thanking my friends and family for all of their support. As I was writing it, it just sounded too canned and insincere. I purchased the rights to these recipes and formatted them in a nicely designed book. This wasn’t really something I poured my heart and soul in to create. So I deleted the entire dedication and decided to have fun with it.

This is what I came up with:

This Recipe Book is dedicated to every steak that’s ever been cooked well done. They didn’t deserve to go out that way. With the recipes in this book I entrust to you great power and great responsibility. May the memories of those poor steak souls live on and guide you towards that perfect medium rare every time you take over the grill. 

This dedication is in line with the whole “Medium Rare” nickname joke and we actually get emails all the time from people about how funny they thought the dedication was!

Building a New Training Resource Center

I’ve posted a lot about the power of my training resource center on this blog before. Up until now, I had always been using Igloo Software to run it on Hyacinth Connect. The only issue with Hyacinth Connect was that nobody but myself knew how to really modify and update procedures on there. As our team keeps growing and the number of processes and procedures keeps growing, it was apparent to me that we were outgrowing the capabilities of Igloo Software.

It took me about a full day to migrate everything over, but I ended up building an entirely new training resource center located at training.mycavetools.com. This new training area runs on WordPress, so every member of our team has the ability to update it without learning new coding skills or anything like that. I’m also running it on the WishList membership plugin, which means that I have full access control to each area of the site so nobody has access to every piece of the puzzle.

With the new wordpress layout, it’s also much more organized and easy to see which procedures are active and which ones are no longer being used in the current strategy.

I also built a team page so everybody can see the roles of each team member. We also centralized our human resources/on boarding procedures here so it is very easy for new team members to get acclimated to their position in the company.

 

Developing a 60-90 Day Perpetual Autoresponder Sequence to Monetize Our List

Building an email list and then never emailing them is something that I would be willing to bet 90% of internet marketers are guilty of. The problem is constantly keeping up with new emails each week. There’s just too much will power involved to do it the right way and be consistent unless you have a dedicated email marketing person on your team.

The idea of building out an entire autoresponder sequence is daunting and in my mind, I thought it would take months to develop. So I just never developed anything. In late September, I decided to sit down and crank it out. To my surprise, it only took about 2 full days of dedicated work to build out.

Here’s how it works:

1. People primarily enter our list in 1 of 4 ways: Website Purchase, Recipe Book Download, Vanity Funnel Opt In (Product Coupon), or VIP List Opt In
2. They automatically get tagged so we know what products they have purchased and where the lead originated from
3. The receive a couple days worth of emails that are relevant to what they signed up for. Ex: A few follow up emails about the product they purchased
4. After finishing that autoresponder they are sent to our Offers Sequence, which is made up of Offer Packets
   1. Offer Packets: These are short email automation sequences that span about 1 week each. If we are trying to sell the kabob set for instance, the person will receive an initial email earlier in the week with “pre-content” to sell the kabob set. Pre Content is usually a youtube video from our channel that deals with the subject matter. In this case, it’s a purely informational email talking about how delicious kabobs are and an instructional video showing how to cook kabobs. Then, a few days later, they receive the “Sell” email which gives them the opportunity to purchase the kabob set at 20% by going through our Kabob Set Vanity Funnel.
   2. The Offer Packets include product offers and affiliate offers. Using this technique, we actually earned a commission when somebody purchased over $250 of Omaha Steaks through our Affiliate Link.
   3. Each time somebody goes through an Offer Packet, they are tagged so we know exactly what emails and offers they have received
5. The Offer Sequence is a collection of all of the Offer Packets paired with if/else statements so nobody ever receives the same offers or emails twice. So if somebody came into the list by purchasing the kabob set, they would skip over that offer packet and only see the offer packets and pre content for our other products.
6. The Offer Sequence currently goes for almost 90 days of 2 emails per week per person. Once somebody finishes the entire sequence, they are sent right back to the beginning. Since everything is tagged, they will skip over all of the old emails they already saw, unless we have added new products to the mix. This ensures that everyone on our email list will at some point be exposed to an offer for every single product line we own as long as they stay on the list.
7. As mentioned in the Click Meter section above, every single link in this sequence is tracked. Once I build my click meter analytics spreadsheet, I’ll know exactly what offer packets convert the best and can logically position them in the Offer Sequence to make sure we maximize the lifetime value from every single person on our email list.

This entire strategy took only about 2 days to build and it is going to be an invaluable asset to the company that will automatically generate thousands of dollars extra per year and ensure that we are keeping in constant communication and top of mind awareness for all of our customers!

General Marketing Strategy Overview

My core competency is on the marketing side of things, so I have a tendency of gravitating towards adding in new marketing strategies all of the time. As good as it is to have all of this marketing going on, the downside is that it adds complexity to the business. Every time we add new products, everything across the board needs to be updated so it all integrates together properly.

In order to continue scaling the company, I need to standardize and simplify the marketing so we can grow fast. Each time I add new marketing strategies, it creates confusion among the team because they are constantly learning new things. I need my team to all be on the same page so they can act as one cohesive unit. For this reason, I’ve decided that we have plenty of marketing strategies in place and it is a more valuable use of time to start maximizing the results of the current strategies instead of continually adding new layers of complexity.

Once that decision was made, it became essential for me to have a broad overview training that explained our marketing strategy in easy to understand terms. Here it is:

 

New Hires and Role Changes

Janna Estrada

Social Media has always been an area of the business we have been lacking in. Up until now, I could never justify having a social media person on the team. There was just no way that they would generate enough additional profit through social media to even pay for their own salary. With that said, we finally reached the point where it made sense to hire a dedicated social media manager, even if that means she is costing us money each month.

The reason for this is because we have such an outrageously ridiculous amount of content. Over 344 Youtube Videos, Almost 100 blog posts, over 185 review posts on independent blogs, Hundreds of custom product pictures from our customers. All of this content was basically just sitting there after creation without ever getting promoted.

I interviewed about 10 people for the position and Janna was the clear winner. She’s actually the most articulate and intelligent person I have ever hired out of the Philippines. Her core values were in line with what I was looking for and she is a total go getter. During the day she works for a music startup (Focusing on bringing Records back into style) in the Philippines and then she works for me at night.

As good as Janna is, I did make a few mistakes when hiring her. For starters, I was looking for someone in the $4-5 range per hour for salary. On the jobs website, her posted salary was within that range. After I told her she was hired, I sent her a message on Skype asking what her desired salary was. She responded that she wanted $15 per hour. I was incredibly busy, so without double checking her posted salary on the website, I just fired back and said that $15 was outside the range for this job and that I was looking for someone more in the $7-9 range.

Of course she accepted the $9 immediately as it was double what her requested salary was. After this all went down, I double checked my notes and couldn’t believe that I just hired her at twice the amount I originally intended to pay her. Writing this down is making me feel even dumber for messing up like this, but I guess I was just juggling too many things at once and she caught me in a moment of vulnerability.

Anyways, the next day I followed up with her and mentioned the price discrepancy. Her requested salary on the website I hired her from was in Monthly numbers, so she said she was confused and thought the amount was in weekly numbers, which is why she wanted such a high hourly rate. I’m a man of my word, so I told her I would still pay her $9 per hour since that’s what I agreed to. However, I made it clear that at $9 per hour she was going to be compared to her American counterparts and that we were going to set a very high bar for her to make her earn that salary.

Typically around $5 per hour is a very nice wage in the Philippines, so at $9 per hour on a part time job at nights, Janna is killing it right now.

Janna has been on board for almost 2 months now and she is doing an absolutely fantastic job managing our social media. To the point where I don’t think I could get an American to do this good of a job even at $30 per hour. She posts the perfect mix of funny stuff, articles, promotional stuff, etc.

I also went out and purchased a seasoned Reddit Account for her to use from some dude in Bangladesh. Last year during Christmas time, somebody posted a Cave Tools link on Reddit and it drove over 15,000 visitors to our website. The traffic potential from Reddit is enormous. The problem though is that Reddit users are crazy and will turn on you in a second if they think you are trying to promote your own stuff on the site.

The seasoned account we are using has been around for over 3 years and has a bunch of “Karma” on it. Karma is essentially like the internal grading system on Reddit to determine how authoritative you are.  By using a seasoned account, we are able to show a history of activity on Reddit of non promotional posts so whenever somebody checks us out we look like a regular user instead of a new account promoting the same company over and over again.

Purchasing and using a seasoned account can be tricky. To make it work, I purchased a dedicated IP address out of Seattle that is used every time we log into the account. That way when Janna logs in from the Philippines, it looks like she is logging in from the same computer in Seattle every time.

Within 48 hours of purchasing the seasoned account from the Bangladesh guy, the account we received was immediately banned from Reddit. They have advanced algorithms to detect these types of things and I’m pretty sure the only thing we messed up on was copy and pasting the username and password during the transfer instead of manually typing it in. That’s how sensitive the process is to get the account under our control. Luckily for me, the guy I purchased the account from replaced it with a new account for free. So far the new account is going well.

Each day Janna logs in to the account and posts random comments in various sub forums and shares links to funny stuff like Cat Pictures. This type of activity helps generate a lot of Karma for us and keeps the ratio of postings looking natural so when we do post our own stuff it looks like just another find on the internet.

Here’s the list of current tasks that Janna does on a daily and weekly basis:

Pinterest:

• Pin Sources: Amazon Customer Pictures, Blogger Reviews, Articles around the Internet, Original Pictures in Social Media Dropbox folder
• Pin all images from blogger reviews and optimize with CTA Links
• Invite Bloggers to collaborate on boards
• Set up alliance jobs for all blogger pins
• Pin images from other websites to our general boards (Use AllTop to find articles)
• Search by Hashtag and follow people who are posting
• Invite new followers to become contributors to our general boards
• RePin images from top trending hashtags and optimize description with keywords and CTA Links

Facebook:

• Respond to any messages sent to us
• Post in open communities using Cave Tools page as profile
• Comment on and engage with anybody who took an action on one of our posts
• Use facebook as Cave Tools and like the pages of each blogger. Use their email address or website name to find them
• Post in the I Love Barbecue page to help share some of our content

Twitter:

• Search based on hashtags and follow people
• Retweet and like posts from the top hashtags
• Research automation robot to assist with these tasks
• Follow all new bloggers

Instagram:

• Follow all new bloggers
• Search for hashtags and then like/comment/follow those people
• Use Instagress to laser target and build up profile http://profitfrominstagram.com/an-entrepreneurs-guide-to-generating-ecommerce-sales-from-instagram 

Reddit:

• We will purchase a seasoned account for you to use and assign a specific IP address to use each time you log in
• Daily activity of 10 minutes per account of regular reddit voting and posting in sub forums
• Never interact from one profile to another so they do not get linked in any way
• Once per month per profile mix in one of our links to good content. Good content is engaging so we are talking about videos, blogger reviews (potentially), images (on our site or maybe pinterest), blog posts. Not using Reddit to send people into the product or recipe book funnels because that is obviously sales and the post will get deleted

 

• Each Friday create the content calendar for what will be posted on each account and when for the next week. Use Hootsuite for facebook and twitter. Instagram and Pinterest can be done daily on the fly

 

Jessica Walker

I spoke in a recent blog post about how my friend Jess hired an Online Business Manager (OBM) to essentially be her COO. To continue growing at the rate I want to, I needed to have another thinker on my team that could keep the wheels on the train. So I followed Jess’s advice and went through Tina Forsyth’s OBM community to hire my own.

Hiring for this type of position was something I have never done before. Usually I build out the framework and training for the person and then it is very easy for them to follow my directions. For this position to work, the person needed to build their own job and have free rein to take work off my plate.

Before posting my job listing, I made sure to read through Cameron Herold’s book Double Double. He gave me a free copy at Camp Maverick and it was incredibly valuable because he covers a lot of information on hiring and provides tons of good interviewing questions.

I designed the first interview to be heavy on the values side of things. I knew that whoever I hired was going to have good prior experience and the aptitude to do the job, so I really wanted to make sure they would be a good fit personality wise with me.

I did 7 total first round interviews, each lasting about an hour long. I then chose 3 people to do a 2^nd round interview with. The 2^nd round interview was set up where I actually let them interview me. I gave them a full hour to ask me as many questions as they wanted about any area of the business and I screen shared to show them all of the different processes and infrastructure we had in place. This was essentially their chance to sell themselves to me and to see where they would jump in and provide value if hired.

After the 2^nd round interview, each candidate then had to prepare a proposal and a blueprint for what they would do and where they would provide impact over the first 60 days of working together.

I had a really difficult decision to make because both Jess and Shannon were very good candidates. In my mind they were essentially a tie. Over the weekend before I made my decision I ended up going to Ontario to watch McGill compete in the lacrosse playoffs. I helped scout the opposing teams with Coach Steinwald and prepare the scouting reports that helped McGill win their 2^nd national championship!

Instead of going home, I decided to shoot over to Montreal to hang out with Ben and catch up. Ben is killing it these days and recently bought his own studio where they are now producing high quality tv commercials. We dissected each other’s businesses from an outsider’s point of view and really learned a lot from each other.

Ben is currently going through Dan Sullivan’s Strategic Coach program, which goes into detail about analyzing the Kolbe A personality test. Ben analyzed the Kolbe tests for both Jess and Shannon for me and without a doubt said that Jess was going to be the better choice. Both Jess and Shannon had similar Kolbe scores, but he said that Shannon was going to slow me down because her quick start scores were not where he would want for this type of position. Tie broken.

So far Jess has been doing a pretty good job. I’ve limited her to a maximum of 20 hours per month, which means that she doesn’t have a lot of time to do labor type of tasks. At $60 per hour, I only want her being a manager/point person for my team. Each week she does all of the KPI scorecard grading and also holds all of the team meetings with everyone. That way I only need to have 1 meeting per week with her to make sure everything is running smoothly. She’s also been able to build and update our operating procedures which has been very helpful.

As good as she has been, we’re rounding out our 2^nd month working together and I’m still not completely sold that she is the right person for the job. In the beginning, I tried to put her in charge of hiring a new PPC person to bring on. Instead of taking control, she created a bunch more work for me by sending me all of the resumes instead of actually interviewing and widdling down the candidate pool. In other areas as well, instead of taking control she was hesitant and ended up making much more work for me. I had a talk with her where I basically told her that she needed to start owning her job instead of asking for permission on everything.

That kind of stuff is expected for the first couple weeks when you are feeling each other out, so I don’t hold it against her. We still don’t have a PPC person on board, so I’m going to make that my project for January. I think my main problem why I’m not sold on Jess is because it’s hard for me to gauge her performance. In a labor position there are key metrics, but for management it’s not like I’m sitting in on the meetings to see how well she is doing.

This week she is taking off for Christmas vacation so I am going to hold all of the team meetings. This will be my first live conversation (outside of chatting in slack) with each of the team members in over a month so it will be interesting to catch up and see how they are doing.

In January I’m going to have a 2016 planning meeting with Jess and follow the structure provided in the book Traction. This meeting is going to set the stage for next year and I’m interested to see what she brings to the table now that she is fully acclimated into how the company runs. In addition to planning out the entire year, we are each going to set our Quarterly Rocks. These are the 3-4 big things that we want to accomplish in Q1.

My goal is to launch 20 products next year, which means I need to do at least 5 per quarter. I also want to hire and onboard a PPC person and build the systems for Jess to effectively manage them. This PPC person is going to play a vital role in achieving my year end goal of building our email subscriber list to over 10,000 people.

For Jess, I want her working primarily on managing the entire team, working with me to build out the SOPs for standardizing our launch procedure, and keeping up on integrating all of the new products into our current systems.

I’m also going to do a full review on her work over November and December and probably have another conversation with her about being more aggressive and assertive. My goal is to mold her into acting and thinking like Cave Tools is her company so when she makes decisions she makes them with conviction.

Marian Concepcion Alba

Marian has been doing an ok job, but she still is not performing at the level I want her to be at. I set her primary KPI at 15 blogger reviews posted per week and she has yet to hit that mark. Right now she is generating around 7 to 8 per week and has yet to receive a monthly bonus. I think 15 reviews might be a little too ambitious of a goal, so I’m going to bring the KPI down to 7 per week so it is more attainable for her.

In addition to blogger reviews, I’m going to add some more metrics for her to hit. One of my goals is to get 1 review posted to Amazon per day per product, so I built a new drip campaign tool that will allow her to give away 1 of every product every day in exchange for a review.

Each week after the meeting, myself or Jess updates the target keyword we are going after for each product and sets it to active or inactive depending on what products we are giving units away for. Marian checks Amazon for the current ranking of the product on that keyword and enters in the current selling price. The screen is frozen so as she scrolls left the other products appear and the proper list of coupon codes is automatically highlighted green so she knows what to grab.

Instead of just giving the product away to the reviewer, we make them do a search and buy first. That means that they actually go to Amazon and search for our main keyword and then buy the product for $1. The search and buy technique has a massive rankings increase because they have to scroll through the pages to find our product. That raises our relevancy for the target keyword. This is what the reviewer prompt looks like:

*Please disclose in your review that you received this product at a discounted price in exchange for an honest review

**Use Coupon Code Immediately upon receiving this email. This promotion ends in 48 hours and your code will become invalid

****Purchase Instructions****

Go to http://www.amazon.com and enter “Target Keyword” in the main search box at the top of the screen. Click Go

Scroll down the page until you see the product picture in the main search results. I just tried it and it showed up on PAGE 1 for me.

If you see the product on the right column of the screen or at the bottom where it says “Sponsored” please DO NOT click on it. That is an advertisement and it will cost us extra money.

Once you find the product you can add it to your cart and checkout like normal using the one time use coupon code provided above.

Please remember that this promotion ends in 48 hours, at which point the code will become invalid. Unfortunately we can not provide an extra coupon code after the promotion expires. If you find yourself in this situation, then don’t worry. You can join our giveaway promotion notifications list so you don’t miss out on the next opportunity http://cavetools.com/PromoReviews

She’s also going to be tapping into Youtube influencers using a service called Content Boulevard so we can start getting video content produced for each product on a regular basis.

Between these 3 jobs, I want her to start consistently hitting her goals so she can get regular bonuses each month and be accountable to our performance based system like everyone else.

Iris Isaguirre

Iris has been doing a fantastic job building out our Youtube channel using Creative Commons cooking videos. We’re now at over 340 videos on our channel, generating over 10,000 views per month, and using Call to Action ads to drive traffic away from Youtube into our product coupon funnels.

Now that we have such a large base of Youtube content, I’ve transitioned Iris over to blogging. Her new goal is to produce 1 blog post per day and embed one of the Youtube videos in each one so we can have all of that same content on our website as well.

I also have her posting weekly on Epicurious and Chowhound so we can start tapping into those audiences and driving traffic. So far this process hasn’t being going super well. I checked up on one of her posts and it had 8 comments on it, all of which were negative because she posted a picture of Pork to go with a Steak recipe. This was something Jess should have caught and fixed but didn’t.

Once she gets the hang of blogging, I plan on scraping a huge list of bbq and cooking websites for her to start reaching out to for guest blog posts. I’ll set her up with her own highrise account so she can manage all of the leads just like Marian does with the Product Review Bloggers.

Product Line Updates

Grill Set:

When we originally designed the Grill Sets, the packaging was over the 18inch mark on the longest side, which classified them as an oversized product. In July, I spoke with Tracy about resizing the tools and the package so we could make them 18 inches maximum and get the product classified as Standard Size units. We placed an order for 3,000 grill sets in July and when they arrived I found out that they were still the 18 inch + size as before. Apparently she spoke with the engineer and decided not to resize them and never told me. This mess up cost me over $11,000 dollar in profit because of the increased shipping fees associated with Oversized Products. This was a huge mess up! I had a conversation with her in July to discuss the importance of communication on these things and made sure that on our next order they absolutely needed to be resized.

In the end, all we had to do was make the spatula 0.5cm shorter and cut out a few cms in the packaging design. We ordered 5,000 grill sets for Christmas and successfully had the product line reclassified as Standard Size. On those 5,000 units we are now going to make an additional $18,750 in profit by making that one little change

Temp and Smoke Magnets:

On my last blog post I talked about the major quality issues we were having with our magnets delaminating and falling apart on people. I came down hard on my US magnet manufacturer and basically told Tina that she better get her shit together or she was done. I’m one of her biggest accounts so I scared the shit out of her. I’m happy to say that she rose to the occasion and the new magnets are fantastic. Instead of having the design laminated to the magnet itself, we now use the same material as car magnets and screen print the design directly onto the magnets so there is no way for it to fall apart.

The new magnets are larger than before and actually cheaper to manufacture as well. Instead of selling the magnets at break even, they are now generating a profit for me because of the reduced cost of goods sold.

Unfortunately we had to abandon the old magnet listings because they were decimated by negative 1 star reviews. However, we have very little competition in that space so the new listings were incredibly easy to rank and we are already building up tons of new 5 star reviews on the new designs.

New BBQ Brush:

This year our grill brush product line was cannibalized by newer better models. Demand dropped significantly and I’m sitting on over 2,000 units of very slow moving grill brushes. This summer we are going to take back control over the grill brush space with our new design.

I took the same new design that everybody else has and tweaked it by making the twisted wires (Not the Bristles) out of Stainless Steel instead of cast iron. The cast iron is cheaper, but it always ends up rusting if people leave it outside. With the new stainless steel wires, I’m going to have the only rust proof design on the market. The original grill brush model was also an oversized product line, so I made sure that this design was Standard Size like the rest of my stuff.

I tested my samples out by leaving one outside under the grill, one completely exposed outside, and one in a tub of water for a couple weeks. The outside models stood up to the weather and the one that sat in water had very minor rusting. For me that’s good enough to make the rust proof claim for standard use.

BBQ Tongs:

In December we launched the Spatula as an individual product line. Now we are also manufacturing the Tongs as individual units that will be available in February. We also did the same thing by selling our kabob skewers in individual 10 packs without the rack. Between the grill sets and the kabob sets, this is an awesome way to create new product lines from already developed products.

Having individual units also goes a long way in reducing the costs of replacement products. In the past if someone received a damaged grill set we would ship out an entire grill set to replace it for them. Now, we can figure out which tool had an issue and just ship that one out to them.

We’re also able to hit more price points with the individual units. If someone doesn’t want to fork out 30 bucks for the whole set, they can buy an individual unit for 11 or 12 bucks.

Grill Light:

When I was in Aruba in March, I talked to a fairly new seller that only sold Grill Lights. With that product alone he was generating over 100K per month during the summer! This summer, we’re going to have our own grill light and it’s the newest model on the market. Just like my grill brush and thermometer were cannibalized last summer, the grill light market is going to experience a similar shake up with these new models.

The grill light is one of those electronic products where it is very difficult to customize and everyone essentially sells the same item under their own brands. Sure, I’ll have the edge in the beginning, but eventually this market will devolve into a price war because there is no differentiation.

To preempt this from happening, I’m designing really high end gift box packaging. All the grill light manufactures sell the lights in a standard color cardboard box. Instead of going with the color box, we are using a Sky & Earth box design and we created a custom foam mold so it looks really classy when you open the box. Here’s an example of what the box will look like:

Burger Press:

The burger press market is another market that is filled with patents. There are only a few designs of the standard burger press that can be freely manufactured and they are all inferior to the patented designs.

There’s a lot of money on the table in this market so I really wanted to get in there. I came across this very unique design one day while searching around on Amazon http://www.amazon.com/Shape-Store-Innovative-Freezer-Container/dp/B00XHI1AGA

Nobody sells anything similar to this product and because it’s made out of silicone there are no utility patents out there. I looked up the company and they launched using kickstarter to raise money and they have tons of press pickup because it is truly a unique product.

As a side note, all of their marketing says they source their silicone in the USA and manufacture in Canada. I found their exact manufacturer in China so they are blatantly lying and will most likely get caught and fined very soon for the deception.

Before I found this out, I actually tried sourcing manufacturing in the US. I contacted a bunch of silicone manufacturing plants across the US and was able to receive a quote from one that had the ability to make it for me. To make it in the US, I would have had to hire someone to create the CAD designs for me and then the mold would have cost me upwards of $40,000 with a unit cost in the $10-12 range. Absolutely fucking ridiculous! No wonder American manufacturing is dying.

By going through the manufacturer in China, I was able to get them to product my 3D CAD models and develop the mold for a grand total of $2,480. My unit cost is still in the $10-12 range so we are currently working on redesigning the CAD models to bring it down to a more reasonable price range.

Instead of doing 8 quarter pound burgers, our design is going to make 6 third pound square burgers. Yes, I’m going to be making square burgers like Wendys haha I think it will add another level of uniqueness to the product because you never see square burgers and there are no square burger products out there on the market.

When you make homemade burgers you are supposed to put a thumb print in the middle of the burger so it doesn’t puff up into a ball when you cook it. Our design is going to have little dimples already pre built into the mold to do this for you. This is going to be my most unique product yet and I think if we can get the pricing down to where it needs to be, it will be a major success!

When my manufacturer sent me the original 3D designs, the side of the tray said “Patent Pending.” I did a little research because I knew this wasn’t something I was planning on patenting and I found that if you haven’t yet filed a patent and you are using Patent Pending, then you can be fined up to $500 per unit. So if I made 2,000 units with Patent Pending on them, then my total liability would be up to $1 million dollars! The manufacturer told me that it was ok and all of her clients put Patent Pending on their products even if they haven’t filed for a patent. I told her she was bat shit crazy and all it takes is for one customer to get curious and start looking for my fake patent. We removed patent pending from the design…

 

Meat Claw Shipping Woes

Almost every blog post I have ever written since starting Cave Tools always involves some sort of fucked up shipping incident that costs me tons of money. Why would this post be any different?

Ever since my epic fail on the Meat Claws infomercial and appearance on The View, I’ve had about 15,000 Meat Claws stashed in my parent’s garage. This caused major cashflow problems throughout the year and severely limited my ability to develop new product lines. Sure it wasn’t costing me anything to keep the inventory at my parent’s house, but it was about $40,000 worth of inventory sitting there all year generating no money. My only hope was that I could somehow sell through them all at Christmas Time.

In November I started the process of shipping out all of the boxed so they could be available in the fulfillment centers for sale. Like usual, I shipped the boxes out of my local parcel place. After a couple trips of shipping out 30 to 40 boxes, the employees there started asking me all sorts of personal questions about my business. I’ve known these guys for years and we always joke around with each other and have a great relationship, so it wasn’t super out of the ordinary.

One day as I was leaving, I went to pay for printing about 25 shipping labels and they charged me about $1 per print compared to the usual 5 cents. When I questioned him on the pricing he replied with a sly remark that it’s a business expense I could write off and that of course I could afford it because my business was obviously doing so well. I was really pissed off at his asshole comments, but decided to pay anyways and then never print there again.

Later that week I printed my shipping labels at home and went down to ship out a couple thousand units. He saw that I printed my own labels and made a comment about me not printing there, to which I replied that at $1 per print I couldn’t afford it and the only reason I printed there in the first place was so I could toss them a couple extra bucks each time. I went about my business preparing the boxes and didn’t engage in any conversation with them at all.

As I was preparing the shipment, I overheard him talking to the woman employee in the back under his breath and he said something along the lines of “I’m sure he probably has insurance to cover his inventory anyways.”

I’ve never felt so uncomfortable before in my life when I left. To the point where I recorded an audio file on my phone on the drive home explaining the entire situation because I was certain they were going to steal all my inventory instead of shipping it out. The retail value of that single shipment was probably in the $30,000 range so I was terrified and almost went as far as driving directly to the police station so I could get something on record ahead of time if something happened.

In the end, I decided to calm down and just keep checking the tracking numbers to make sure it all shipped out the next day. It did and nothing ever happened, but I will never go back there again.

Instead of putting myself in that situation again, I ordered a bunch of packing slips from UPS and scheduled a pickup at my parent’s house for the remaining couple 100 boxes. The UPS guy that picked it up was actually my cousin Andy, so it was cool catching up with him and loading the truck together.

I definitely learned a bunch of lessons from this encounter that will stick with me forever. For starters, people treat you way differently when they know or think you have money. Even if you think they you have a good relationship with them, money changes perceptions pretty quickly. Especially when the people you are dealing with are probably earning minimum wage. I’ll also never again put that amount of inventory at risk without my oversight.

Missing the 7 Figure Mark Because of Shipping Screw Ups

I’m going to finish the year at around 930K in revenue between Medium Rare Industries and Hyacinth Marketing. About 870K being generated by MRI/Cave Tools and 55-60K by Hyacinth Marketing. This is a significant improvement over last year. I haven’t looked at all the final numbers yet to compare, but it will be about 400% growth over the past year. As awesome as that is, 7+ figures was easily within my grasp and I screwed it up because of shipping.

After experiencing shipping delays last year around Christmas time, I told myself that this year I would have everything in stock by October at the latest so there was plenty of room for error. In order to get everything in stock by October, I needed to place all of my inventory orders in August. However, I essentially took the entire month of August off this year while I was traveling around in Europe. All I needed to do was sit for about 4 hours to make my projections and place my orders and I would have easily made 7 figures. Instead, I procrastinated and never placed my inventory orders until about the 2^nd week of September.

My plan was to launch the 10pc Skewers and Spatulas by the end of October or early November so they could be in full swing by the holiday rush. However, since I delayed on the manufacturing side of things, the skewers never launched until the 3^rd week of November and the Spatulas never arrived until the 2^nd week of December. The skewers ended up doing alright for the holidays, but the Spatulas missed the mark almost completely.

Normally when I bring inventory in, I send it to an intermediary warehouse in San Francisco and then ship to the fulfillment centers using Amazon’s UPS account. However, since I was late on placing my orders, I decided to ship everything direct from China to Amazon. This was the first time we ever did this before and we ran into a bunch of unforeseen obstacles.

When the skewers arrived, the trucker went to the designated fulfillment center and waited in line for 4 or 5 hours before they could get to the front of the line. When they got there, they were rejected because we never made an appointment. Apparently when you are shipping to the fulfillment centers using your own trucking instead of the Amazon UPS account, you need to make a delivery appointment. Amazon doesn’t mention this anywhere on the shipment creation screen, so there really was no way to plan for it.

The trucker was pissed because he was never able to drop the inventory off and he had to go back to wherever he was dispatched from. While this is going on, my freight forwarder was calling me on my cell phone trying to figure out how to set an appointment. I was somewhere up in the mountains on my way to Montreal so I had no service. I ended up pulling over to a gas station in the middle of some run down little mountain town so I could get wifi and figure everything out. I sat on my laptop in this little gas station convenience store for about an hour going back and forth and trying to get instructions from Amazon on how to set an appointment.

We finally figured it out, but the next available appointment date wasn’t for another 3 or 4 days. That means I had to pay for the 1^st full day of the trucker and for a couple days worth of storage until they could drop the inventory off. When they got there on the appointment date, the trucker waited a full 8 hours in line and never made it to the front of the line. He had to turn around and go back again. Luckily, we were able to set another appointment for the next day. This time, the trucker made it to the front of the line, but because of the wait time he arrived about 2 hours after the allotted appointment time. Amazon has a rule that you have to deliver the goods within 1 hour of your appointment time, so they automatically canceled our appointment and once again the trucker was turned away.

At this point, I was furious because all the extra storage and trucking fees were murdering me on my margins. All the trucker needed to do was check in to let them know he was waiting in line and they wouldn’t have canceled the appointment. Finally, on the 4^th attempt we were able to deliver the skewers. Even with all of those delays, we were still able to get them in by the 3^rd week of November.

Those two were new products, so I wasn’t banking on the additional revenue from them putting me over the 7 figure mark. What really killed me was stocking out of the Smoker Boxes for about 3 weeks over the holidays. Even though I was late on ordering, I still would have had enough time to replenish the inventory if it wasn’t for my freight forwarder completely dropping the ball on me.

We had already gone through all of the issues with delivering the skewers, so we were prepared for the appointments to deliver the smoker boxes. I had been in constant communication with them about the importance of speedy delivery on the Smoker boxes because they were one of my best selling products and I was running low on inventory. Everything was set to be delivered on the Tuesday before Thanksgiving and if all went as planned, I never would have stocked out.

Each month, I get charged a little over a thousand dollars in interest on my loans I took to finance the year. Since I had a bunch of money in my account, I decided to pay off about $10,000 worth of the loans so I could reduce my interest payment. What I didn’t realize, was that my magnet manufacturer sat on their check for a few extra days instead of cashing it right away. Between the loan payment and them finally cashing their check, my account didn’t have enough money in it when my freight forwarder went to cash their check for the smoker box delivery and it bounced.

On Tuesday morning, I woke up to an email from them saying that the check bounced and they immediately canceled my delivery until the money was paid. Within an hour from them sending that email, I wired the money directly into their account. However the damage was done and they never made the delivery on Tuesday. Everybody was off over Thanksgiving and there were no open appointments the week after, so because of that one little mistake, we never got the smoker boxes back in stock until the 2^nd or 3^rd week of December. This mistake alone probably cost me about 80K in sales.

I was absolutely furious with my freight forwarder! I have been a customer of theirs for over a year and a half and have always paid on time. Yes, it was my fault that I didn’t have enough money in the account for them and the check bounced. But the least you can do is pick up the fucking phone and give me a call. Especially when it was clearly communicated how important this inventory was because we were in the busiest time of the year. They had their money within one hour of sending that email, but because they didn’t take 5 minutes to call me, they cost me about 80 thousand dollars. From a customer service standpoint, that’s absolutely pitiful.

Of course afterwards, they were apologetic and did their best to smooth things over. What else could they do? They totally fucked up. I’ve been through the gamut of shitty freight forwarders so I’m not going to fire them, but that large of a mistake is really difficult to swallow.

Christmas Season Sales Review and Projections mess up

I discussed my Q4 sales projections and methodology in my last blog post. Well…I was way off! Last year my sales inflection point was on October 31, so I expected it to be the same for this year. Instead, the sales inflection never came until around November 18^th. That’s 18 extra days of regular sales numbers when I was expecting about 2x to 3x the demand. Those 18 days were incredibly stressful and full of doubt. I had ordered a shit ton of extra inventory and all I could think of was how I was going to get stuck with it all and have to pay a major tax bill that I probably couldn’t afford at the end of the year. I also had a garage full of around 15,000 meat claws that I was sure were never going to sell.

During this time period, I went back and inspected the logic behind my projections. The logic seemed sound at the time, but I realized that it was all based on relative increases in demand instead of fixed increases. For example, I expected grill brush sales to at least double because they doubled the previous year. The problem with that logic is that my average daily sales this year on that product line were higher than the previous year. I don’t remember the exact numbers, but if I went from 10 a day to 20 a day last year, then instead of going from 15 a day to 30 a day this year, I should have projected to go from 15 a day to around 20 per day.

Using fixed numbers would have given me a much more accurate projection of demand than the relative increase. When multiplied across 11 different product lines, the margin of error on my projections was huge. According to my projections, the absolute lowest revenue I should have done was $500,000 between November and December, but I was expecting to realistically do around $600,000 or $700,000.

Next year, I’ll be sure to use a more conservative estimation process by going with fixed demand numbers. Of course, we still did extremely well over the holidays, so I can’t be too upset. My biggest day came on November 26 when we ran 2 lightning deals and did $26,502.11 in one day!

Lightning deals are invitation only by Amazon where they feature your products on the first page of Amazon at a significant discount. I submitted applications for all of my products, but only the Grill Brush and the Grill Sets were included. On November 26, we sold 719 grill brushes at $11.99 and 322 Grill Sets which accounted for about $22,000 of the sales that day.

Selling 719 grill brushes in one day boosted my Best Sellers Ranking up to number 6 in all of PAtio Lawn and Garden!

Cyber Monday was just a few days later and gave us an additional $16,542.89 in sales to really kick off the holiday season. After Cyber Monday, I really saw our sales skyrocket on a day to day basis and as we got closer to Christmas we strung together multiple 10K plus days and then even a 3 or 4 day period where we were consistently doing over 15K per day. I took screen shots along the way to show the ridiculous progression. I was literally checking my cell phone every hour of the day during the holidays just watching the sales come in.

December 2:

December 10

December 14

December 15

December 16

December 18

December 23

These numbers were all fueled primarily by the fact that the Meat Claws ended up being ranked in the #3 and #4 position for “Gifts for Dad” on Amazon through the month of December. I don’t track the rankings for all the other similar variations like “Gifts for my uncle” or “Gifts for Brother,” but we were up there on the first page for almost all of those as well!

I think the Meat Claws lend themselves as really good gift ideas, but I also promo’d out about 100 units to target “Gifts for Dad” and I jacked up my advertising bids to help them reach those rankings. At one point we were selling over 700 meat claws per day and I had to jack the price up to lower the demand. I went from being terrified that I would even make a dent in my inventory in November, to being afraid of stocking out of the Meat Claws in December! By the end of the year, I was selling the Meat Claws for $19.99 while my competitors were all fighting over sales of essentially the same product at $9.99.

Currently, I’m left with about 550 units to carry me through January and February until my next batch of 10,000 units comes in to cover the summer.

Between November and December this year, we did $426,323.66 in sales across 28,088 units. November and December accounted for about 49% of our yearly total, which came out to be 56,604 units for $871,497.44. If it wasn’t for the shipping delays, I totally could have knocked off the 7 figure mark, but again, with numbers like these there is no room for me to complain. We killed it this year! Last year we did 11,157 units for a total of $203,329.62 in sales. That’s 429% growth in one year!

With the plan I have in place for next year, I’m hoping to hit over 600% growth in 2016. Yes, that’s about $6 million in sales! I’ll talk more on that in a bit, but for now, let’s look at my year over year growth since starting out on my own.

2011 – $1,000: I picked up the Millevoi Bros contract in October and was still working for Simplex Grinnel

2012 – $20,935: I partnered with Ben in Montreal starting in May, but September was our last month working together so the end of the year had no substantial income

2013 – $89,003.89: Living at home and seriously struggling to get the marketing company back on it’s feet. Almost quit and got a job because the majority of this income came towards the end of the year. The beginning of the year was brutal partnering with Wayne trying to get the National Alliance for Student debt Awareness off the ground. Towards the end of the year I started Cave Tools and we did $51,949.65 in sales from May to December with just the grill brush.

2014 – $263,001: First summer where I really put my full effort into Cave Tools. Hyacinth also generated about 60K. With 263K in sales, I still only ended up with a profit of $9,822 that year because I was self funding and everything was getting reinvested into Cave Tools.

2015 – $900,000+: I don’t have my final year end numbers yet

Looking at the numbers this way really puts things into perspective. It wasn’t until mid way 2015 that I really got my feet under myself and could start taking a regular salary. It took me 3 years of serious struggles to lay the groundwork for our success this year. I can remember so many times when I was at the absolute breaking point and ready to throw in the towel, but there always seemed to be one more opportunity on the horizon that if I could just hit, I would be able to sustain myself.

Taking Over Exclusive Amazon Sales Privileges for Amara Baby Food

Bobby’s friend Jess started a company called Amara Baby Food a few years ago after winning a Start Up Chile contest. They have an strong Angel backer and have been doing pretty well on the retail side of things by getting into Whole Food and a bunch of other super markets in the US.

Jess reached out to me for some help in September because they weren’t making any sales online. I didn’t have the time to help her out, so I put together a couple of listing optimization videos for her so she could manage Amazon herself and start making sales. I had already done an hour long consulting call with her the previous year, so I figured that between that call and the new trainings, she could handle it.

Even after all of the free training I gave her, she still wasn’t making sales. The online world was completely new for her, so she didn’t have the ability to really implement things the way they needed to be. In November, Jess came to Philly to have a few meetings with VCs so she could raise more money. We went out to lunch together and she explained to me that even though they were doing well on the retail side, cashflow was extremely tight. It takes a long time to turn inventory in retail and if they didn’t raise more money by the end of the year, they were probably going to go under.

I was in the middle of preparing for my Q4 so I didn’t have any available time to help her out. I tried pushing her off until January, but I took a step back and realized that I had the opportunity to help save her business. If I didn’t do something quick to help her out, her business was going under. As a friend, I would feel horrible if her business failed and instead of helping her out, I spent my weekends drinking in the bar with friends.

I know It’s not my responsibility to help everyone and I definitely need my down time so I can rejuvenate, but if there was a way to make it work I at least wanted to give it a shot. I consulted with one of my Amazon Masterminds and I studied some old material I had from Dan Collins, who primarily does Amazon Consulting for other businesses instead of his own brand.

About a week or two after I met with Jess, I presented a solution to her. The plan was that I would get an exclusive for all Amara sales on Amazon in exchange for 25% of her net payouts. She would be responsible for all financial and inventory matters and all I needed to do was make her products sell.

My presentation was definitely met with resistance because the typical exclusive deal in retail was usually around 5% and that’s for a major brand like Whole Foods. She tried to negotiate, but I stood my ground. Anything less than 25% was not worth it for me because I would be working for cash instead of building my own asset and I used the exact same contract that Dan uses for the 6 or 7 brands he manages, so I knew that was the going rate for this type of work.

There was also a line in the contract that states that if her company is sold, my contract must remain intact in its entirety unless the acquiring company wants to buy me out of the contract. Their goal is to sell to a big company in the next few years, so they didn’t want to be locked into anything that would hurt their chances of selling. I understood where she was coming from, but also explained that if I get her Amazon account up to say 20 or $30,000 per month in sales, then I am building the asset for her that will be largely responsible for them hitting the numbers they need to hit to sell the company.

We each went back and forth and I made some concessions, such as having a trial period where they can cancel the contract if I don’t hit certain numbers in the first few months. We are now set to fully launch tomorrow, January 4^th and I’m really looking forward to seeing what I can do for her brand.

To me, this is a win-win situation. They will go from $0 in sales each month to most likely around $10,000 per month within the first few months and continue to grow as I work my magic. For me, the only expense is going to be my time. I will have to front load a lot of time in the beginning, but once they are up and running, my team should be able to handle the majority of the work. If I can get them up to around $10,000 in pay out each month, that’s an extra $2,500 in profit for me every month. Hyacinth Marketing currently does maybe $1,000 in profit per month across multiple clients (I fired a bunch of clients so I could focus on Cave Tools this year), so this one client will make a huge difference for me. At the end of the day, it’s also going to feel great to help them out with their cashflow problems so they can stabilize the business and continue growing their retail side.

Landing Interviews and PR

The other day my buddy Perry reached out to me because they are launching a podcast called www.cashflowstartup.com and he wanted to talk about my success in ecommerce. In the entrepreneurial world there are typically 2 main types of businesses. Venture backed business are the most well known kinds of businesses where you raise a bunch of capital and try to launch something that is disruptive and has a high chance for acquisition. These types of businesses are normally all or nothing. You either hit big or you fail. The other type of business is a cashflow business where you usually bootstrap it and build a company that generates cash and helps you achieve a certain lifestyle. Cave Tools definitely falls under the cash flow category.

In my opinion, most new entrepreneurs should start out with a cash flow business before going the venture backed route because it helps you learn the ropes of business and also helps you achieve a certain level of financial security where you can target a disruptive business idea without worrying about how to pay the bills. I’m actually very amazed that nobody owned the cashflowstartup domain already because I’m sure it gets a ton of organic searches.

The interview went very well and we discussed a lot of the lessons I have learned and advice I would give to new entrepreneurs who are just starting out. Right now they are building up their interviews, so it hasn’t gone public yet, but I expect it to be live in the next few months.

In November somebody also reached out to me from the www.profitwithpassionsummit.com. I was surprised from this phone call because the entire summit is focused on Christian Entrepreneurs and I am not religious at all. Somebody apparently recommended that they interview me for the virtual summit.

I explained to the guy that I wanted to be very clear that I was raised Catholic, but no longer consider myself a Catholic or Christian. I told him that I do however have very strong core values that closely align with Christian values. My answer was either exactly what they were looking for or they were desperate to fill up the speaking spots. Either way, I was in.

The sent me over some sample questions before the interview so I could get an idea of what we would be talking about. It was kind of funny because all the questions were phrased like “As a Christian Entrepreneur…” to basically try to get me to say I was a Christian. I have no intentions of pretending to be somebody I’m not and I clearly told them multiple times that I was not a Christian, so I just ignored the Christian part and responded “As an Entrepreneur…”

The Summit goes live on January 29 to 31 and they have an entire marketing team promoting it, so I’m looking forward to seeing what type of exposure I will get.

Consulting on how to Outsource Properly

Lately a lot of my friends in Maverick Next and Sovereign Academy have been reaching out to me for help on how to outsource properly. I always love helping out my fellow entrepreneurs and I’m flattered that a lot of people view me as an expert in this area. It reminds me how much I learned when partnering with Ben in Montreal and how much I’ve built on that foundation in the last few years. Especially in this past year, my approach to outsourcing has evolved dramatically.

I still have all of my Outsourcing material I put together for ASM Elite, which goes into granular detail about how I hire and manage my team members. In the last 2 months, I’ve sent these videos to my friend Ben to help him with his info marketing business and my friend Isaac to help him with his Amazon business. The videos are great because I can just send it over and then have a quick follow up call to go over any questions they may have. I also did a hour long consulting call with my friend Nesh in Australia to help him integrate some VA’s into his business which is a meal service for people on the Paleo diet.

Final Year End Review

2015 was easily the most successful, fulfilling, adventurous, and fun year of my life so far. In the beginning of the year I was still living at home. My business was growing, but financially I was struggling to make ends meet. I remember telling myself in the beginning of the year that this had to be my year. After living at home for almost 3 years since returning from Montreal, there was no way I was going to continue being a dependent “Struggling Entrepreneur” by the time I turned 26 in October.

My first big decision was to leverage debt to grow the company. Taking on almost $100,000 in debt from the bank was one of the scariest decisions I ever made. That decision was a major game changer for me and set the stage for the success that followed throughout the rest of year.

In February I attended the ASM conference in Vegas. I had recently made about $15,000 in profit from the affiliate launch and planned on using that money to sustain myself so I could finally move out on my own. However, at the event I was offered the opportunity to join a high level Amazon mastermind in Aruba that cost $15,000. Instead of taking the money and moving out, I decided to invest it in myself by going to the mastermind.

That single decision resulted in:

• Me getting accepted into Maverick Next and building a ton of new relationships with extremely motivated entrepreneurs
• Getting the chance to meet Ramit Sethi and get his advice on whether or not I should start a new brand in Europe or not
• Going to Camp Maverick and hanging out with tons of 7 and 8 figure business owners
• The inspiration for my KPI scorecard system
• My entire youtube marketing strategy
• In depth analysis and understanding of my personality type as it relates to business
• My weekly Amazon mastermind group which keeps me on top of everything going on in the industry
• My ecommerce mastermind group
• My scaling to 7 figures mastermind group

 

I took a huge risk by allocating about $40,000 to the meat claws infomercial and it failed miserably. I learned a ton of lessons from that failure and was able to successfully use the other $60,000 or so dollars to launch 8 new product lines throughout the rest of the year. I also built tons of new scalable processes into my business and hired 4 new team members in Marian, Iris, Janna, and Jess.

Instead of becoming tight with money after the $15,000 mastermind, I decided to double down and invest in myself as much as possible this year between masterminds, courses, and voraciously reading new business books. I’m not sure what the exact dollar amount is, but I estimate that I spent close to $25,000 this year on self-improvement. The value I gained from this investment is incomprehensible when you consider that the same dollar amount could barely afford me 1 year of college tuition.

At the same time as I was quadrupling my business, I was also making a point to travel more than I ever have in my life. This year I went to Las Vegas twice (ASM event, Fantasy Draft with College Friends), Chicago (National Housewares Tradeshow), Aruba, Ireland, France, Lithuania (Sovereign Man), Latvia, Estonia, Sweden, and Connecticut (Camp Maverick).

While traveling, I also came to the realization that I finally achieved the geographic and financial independence I have been working towards since starting out on my own. Of course I’m not truly financially independent, but I have more than enough to live the lifestyle I want to live in 2016. To me that’s freedom and it feels incredibly liberating.

Setting my Sights on 2016

This year was an amazing year, but I’m determined to make 2016 even better.

Personal Goals:

• Move Abroad: I leave tomorrow for a 10 day “Scouting” trip of Panama and might jump over to Medellin in Columbia for a few days as well. Assuming I like Panama, I intend to make it my home base for the next year
• Become Fluent in a new language: I’m going to apply the same techniques I used to become conversationally proficient in French on Spanish. I’ll also most likely take Spanish classes so I can become completely fluent and work on my accent.
• Live Without a TV: I really enjoyed not having a television when I lived in Montreal. It forces you to read and get out more. I’ve watched entirely too much TV over the last 3 months so I intend to cut the habit by purposely not having a TV in my new apartment
• Travel Extensively: Exploring new countries has always been one of my passions. Next year, I intend to hit most of South America and hopefully make a trip to Hong Kong to visit my brother.
• Meditation: I worked meditation into my daily ritual for a good 3 or 4 months this year before I broke the habit. My meditation practice worked absolute wonders on my mental health and business growth this year. Next year I will make sure I stick with it and meditate daily
• Body Sculpting: I haven’t been to a gym in well over a year. I do pushups and sit ups daily to keep in shape, but next year will be different. After I move I will make going to the gym a priority and focus on building muscle mass instead of just staying in shape
• Pick Up a New Hobby: Outside of my lacrosse team, I never truly got involved in the Philadelphia community. I was too busy with my business and probably a little too lazy as well to get my ass off the couch on week nights. I’ll figure out what my hobby is after I move, but right now I am considering at least one of the following: learning salsa, scuba diving, kite surfing, surfing, and possibly bungee jumping in the various destinations I travel to.

Business Goals:

• This year we launched 8 new products, 2 of which came in December so they don’t really count. Next year my goal is to launch at least 20 new products. If we could quadruple with 6 new products, think of what 20 new products can do.
• Scale my business from 900K to 5 or 6 million in revenue so by the end of the year I am ready or close to being ready to put Cave Tools up for sale. 5 or 6 million is largely dependent on how well the new products do and how quickly I can get them out. At the very least, I expect to do $3 million.
• Increase our email list from about 2,000 subscribers to over 10,000 subscribers
• Maintain a 40-50 hour work schedule with minimal work on weekends
• Learn as much as I can about investing and start getting skin in the game

It’s September 3^rd and I’m writing this while flying to Vegas to meet up with my friends for our fantasy football draft. I haven’t been in Philly for a weekend since before July 24^th. During that time, I’ve traveled to Ireland, France, Lithuania, Latvia, Estonia, Sweden, Connecticut, and now Las Vegas. From July 24^th to August 24^th I didn’t work more than 8 hours a week. During that time, all I really did was check emails and delegate to my team. They performed wonderfully in my absence and took the initiative to make sure they got their work done. We even launched our latest product line, the smoker box, while I was away and succeeded in topping the hottest new sellers list in our category.

When I reflect on this past month and my life in general, I can’t help but feel incredibly grateful. I’ve earned it through my hard work of course, but there’s something to be said for the practice of gratefulness. On my 3 hour drive home from Connecticut I had the windows down and I sang at the top of my lungs and just smiled and was grateful for the good in my life. I’m aware that I’m on an upswing right now. I’m recharged from my travels and there are a million things I want to implement in my business. Life is good. The more I can internalize the practice of mindfulness the better off I will be on the next inevitable down swing.

I’ve Decided to Move Outside of The US

My last post was very introspective. I wrote it free form without editing so I could get it all out of my head and start to conceptualize and develop my ideas.  It’s been a few weeks now and I’ve had a lot of time to think about things from a less impulsive perspective.

During my travels I experienced freedom in a way I never have before. Since then, I’ve noticed that I have been more confident and I’m thinking and acting much more independently than I have in years. I’m living life on my terms instead of trying to please everybody. I don’t know how long I’ll be away for or how much I’ll decide to move around, but I do know that I need to continue exploring my freedom.

So Where To?

I’m not going to make that decision right now because I know I can’t move until January or February of next year. There is just too much at stake for 4^th quarter sales for me to be in a transition period right now. I will say however that I am strongly considering somewhere in Thailand or Panama City. I’ve never been to either of these places before, so I don’t know what it would be like to live there. When we get closer to December / January, I’ll make a list of pros and cons and start seriously researching each place to see if it fits into my goals. Cheaper cost of living is definitely preferred, but the most important reason for moving is really the personal growth side of things.

One of my goals is to become a sophisticated investor. Right now, I’m developing my business skills, but later in life I see myself as the type of person that buys, sells, and invests in a bunch of different businesses. To get to that point, there is a lot of investing and financial knowledge that I need to acquire. The way I see it is that if I can lower my living expenses by 1 or 2 grand per month, then I can freely invest that money without fear of losing it.

By moving to a place like Thailand or Panama, I can be aggressive and shorten the feedback loops required to learn through experience. I’ve also purchased both Security Analysis and The Intelligent Investor by Ben Graham so I can learn the theory side of value investing.

I’ve had a lot of conversations recently with entrepreneurs from all walks of life and I have to say I’m scared about what’s coming down the pipeline for the U.S. in the next handful of years. Right now, all of my wealth is held in my business. If something were to happen and people stopped buying commodities, I would have nothing to show monetarily for my hard work. I’m in a position where I should be heavily leveraged on growing my business, but at the same time, I need to make a concerted effort to take more money out and start diversifying into some other types of investments as well.

If I’m taking more money out, then I sure as hell better be laser focused on growing the pie as well. To do that, I need more personnel and I need more product lines. Part of moving to a cheaper place means having the ability to cost effectively open up an office and hire educated employees at a fraction of the price it would cost me in the United States.

We’re at a point financially in the company right now where we can afford on self-funding alone to be launching  1 to 2 new product lines every single month. There’s no doubt in my mind that by the end of next year we can have a full line of bbq and cooking products in our store. The only limitation to achieving this goal is bandwidth.

The 2 key hires I see right now to make this happen are a product development manager and a marketing launch manager. The product development manager will be tasked with researching new products, contacting manufacturers and cultivating relationships with them. They will need to build up a serious pipeline to ensure that we hit the 1 to 2 new products per month mark, but it’s completely doable.

By cranking up the product development engine, we also need to crank up the marketing engine to ensure each launch is successful. The marketing launch manager will be tasked with making sure all of the steps in our launch sequence are completed on schedule for each product.

These are 2 major hires, but they don’t need to cost me major dollars. Both positions are already fully built out and detailed. I just need educated people with attention to detail that can follow directions and execute the plan. If I can get both of these engines cranking, then we go from a 10 product company this year to a 30 product company next year.

Scaling to that size is not as simple as it sounds. From a management perspective, I need to start siloing other parts of the business out and hiring specialists. Before cranking those engines, I need to make sure I have the additional infrastructure and support available for that type of growth. My next hire right now is a dedicated social media manager / content producer. For this position, I’ve been looking into hiring a work from home mom in the United States. I’m looking at about $10-15 per hour for a 10-20 hour per month job to start.

After I fill that position, I’m looking to bring on an advertising campaign manager. I’ve already started systematizing and building the tools needed for this person to quickly analyze and update all of our campaigns.

The advertising analysis tools I’ve built are actually so impressive that I’ve decided to shop them on the market. Originally I was thinking I would create my own Amazon Advertising course and sell it, but I decided it would split my focus too much. I’m not an info marketer and I don’t have the infrastructure in place or the audience to easily launch a course like that. So I decided the best way to take it to market would be to reach out to someone who is already big in the space and partner with them. The first two people that came to mind were Ezra Firestone and Kevin Bombino.

I hung out with Kevin all week at Camp Maverick, so I decided to call him first. He actually lives in Vegas so I was hoping to meet up with him this weekend. Unfortunately, our flights are just going to miss each other on Sunday when he gets back from Burning Man and I return to Philly. Instead, we are just going to teleconference together next week.

Kevin owns Link Emperor, which is an SEO software I have been using for 2 years for my clients, Press Advantage, which is a press release distribution service, BrickFTP, which is an enterprise level file transfer system in which they spend over $100,000 per month just in advertising to compete against Cisco, and he owns Scientific Seller, which is a suite of Amazon seller tools. Very respected in the industry and has a huge list to promote to. He’s also like 30 years old and flies around in his own jet like a boss even though he admits owning your own plane never makes financial sense and is a complete cash suck.

So we’re going to meet next week and I’ll see if I can partition my tool off to him to add to the Scientific Seller brand. Regardless of if we move forward together or not, I value the fact that he has good morals and will be completely honest with me in terms of market viability and commission splits. I don’t know if I would feel the same way if I was entering into this conversation with Ezra.

Speaking of tools, I have been hard at work developing a bunch of new tools for various areas of the company. Let’s start off with the amazon advertising tool

Amazon Advertising Tool

This tool is really cool. With Amazon ads becoming so competitive, the only way to remain profitable is to bid on longer tail keywords. The primary keywords like “Grill Brush” are just too expensive because everyone and their mother is bidding up the prices. Longer tail keywords like “Weber brush for grill” on the other hand can be purchased for cheap and will result in an ROI. As you can imagine, the longer tail you go, the more variations are possible. So you get into a situation where you are someone like me with 9 or 10 ad campaigns running at a time, each with a couple hundred keywords in them.

Until very recently, this was incredibly difficult to manage and there were/are no tools out there to help you manage it. A few weeks ago, Amazon released a new feature that allows you to bulk download your campaign data into an excel spreadsheet. That’s where my tool comes in.

All you need to do is insert the bulk data into the raw data tab and then everything populates into a separate tab with a nicely formatted report. You pick the campaign you want to analyze from a drop down and it will tell you which keywords are hitting the desired metrics, which keywords need to be dialed in a little more, and which keywords we are losing money on without making sales. It’s all color coded so you can go down keyword by keyword and make quick modifications. The suggested increase or decrease is already provided for you based on a set of rules I created, but I can make judgement calls on the fly if I would like as well. Make all your edits right there in the spreadsheet and then copy over into a bulk upload file and voila, your entire campaign is updated to meet the specific metrics you are targeting for every single keyword. This tool save hours and hours of analysis every week and it removes the lazy factor of guessing what the bids should be because it auto calculates for you.

You can then insert the raw data from your automatic Amazon ad campaigns and it will analyze the data and find top performing keywords that aren’t being targeted in your manual campaigns. Just like before, it will automatically tell you what your suggested bid should be. All you need to do is bulk upload them into Amazon and your manual campaigns are up to date.

Finally, the spreadsheet also keeps track of all relevant metrics that you could never get access to through the Amazon interface. I now have an historical record of my macro and micro statistics on a weekly and aggregate basis. By creating a couple formulas, I’ve also been able to determine the exact cost per acquisition we are paying to acquire customers. This data is so invaluable from a management perspective. Before this spreadsheet, we were essentially flying blind. Now, we’re able to make tweaks on the fly to dial in every single campaign to our goals.

All we need to do to make this spreadsheet work is record a couple metrics once per week. Whenever we want to update the campaigns we just need to paste in the raw data. That’s it. Everything else auto calculates. Of course this task has been delegated to Caecilia already, so every Monday morning the spreadsheet is completely ready for me to make strategic decisions.

COGs Analyzer

The Cost of Goods Sold Analyzer was born out of necessity because of how many manufacturing batches we are doing across multiple different manufacturers. I always had most of this data, but it was never in an easily digestible form where I could make legitimate decisions off it.

Now, for each product I can see the historical rates for Manufacture Date, Re-order Time since last batch, Quantity, Manufacturing Costs, Import Costs, Total Cost of Goods Sold, and Per Unit Costs of Goods Sold. If I want to look at the Grill Brush, then boom, the last 5 shipments are all right there for me to compare. That’s my micro statistics.

On the product macro side I can also see overall how much money has been spent on Manufacturing and Shipping, as well as total average re order time, average order size, and average cost of goods sold.

Then, we take it to the next level and look at those same statistics based on manufacturer because some manufacturers do multiple products for us. By having all of this data at my fingertips, I can easily see how strong my relationship is with each manufacturer and track how often we are ordering from them. For our Grill Brush and Grill Set manufacturer, I can accurately say that we have spent over $55,000 with them, we place an order once every 5 months, and when we order from them, the final cost of goods sold is typically about 63% manufacturing and 39% shipping compared to our aggregate statistics of 69% manufacturing and 31% shipping.

I’m 2.5 years into this business right now. If at any point before this you asked me about that ratio, I would have very confidently told you that the majority of our costs comes in on shipping, not on costs of goods sold. That’s not because I was ignorant, it’s just because the data wasn’t available to me. I tend to think of products in terms of unit costs and shipping in terms of total costs. Now that I have hard data, I can tell that I was mistaken.

 

Freight Estimator

My freight estimator is another pretty cool tool. It’s not entirely accurate, but it gets close enough for me to make a good prediction. Every couple of months, my freight forwarder has to issue a General Rate Increase (GRI) based on what’s happening in the industry. I take those numbers from the GRI and plug them in to the tool and everything else is calculated.

All I need to do is pick my product from a drop down and set how many units I want to import. It then scans through a table on another sheet to figure out the dimensions of each carton, the weight, how many total cartons, units per carton, and cubic meters of the shipment. It then cross references this information with the pricing information to give me a breakdown of Ocean, Trucking, and total shipping costs.

New Blogger Review System (review embargo on launches)

My blogger outreach system is bad ass. I’ve discussed it on here before and I know how powerful it can be when utilized to its full potential. The problem is that we just haven’t been able to get it cranking at full speed. I have Marian working it 40 hours per week and we still can’t get up to 15 published reviews a week. So I decided to do an overhaul.

I started out by asking Marian a bunch of questions about what she thought of the system. It turned out there were just way too many steps that needed to be done and we were collecting so much extra information that we were never actually using. The system was just too complex to run the way I wanted it to run.

My job when I sat down to review the system was to simplify it, automate as much as possible, and break the management portion down into easily digestible chunks. This is the picture I came up with in my notebook:

At any point in time, a blogger would fall into 1 of 4 categories: Prospecting, Agreeing to Review, Follow Up, and Review Analysis. The original operating procedure for the whole process was one document that was about 20 or 30 pages long. With this new chunking format, we can have 1 shorter operating procedure for each categorization of the blogger. We also removed a bunch of unnecessary steps so the process could be simplified and executed repeatedly without missing steps.

Marian’s KPI of 3 per product per week also seemed to be very unfair because she couldn’t control who was posting which product reviews when. So instead of breaking it down by product, we just say now that we want 15 total reviews per week and we’ll decide which products to push in our weekly meeting.

When we got a blogger interested in our products, we don’t just send them the product. Instead, now we are making them agree to our terms. Our terms are there to basically ensure we get high quality reviews instead of junk. The reviews are still completely honest on the blogger side, but we ask them to agree that they will:

1. Make actual opinions instead of copying and pasting our product description
2. Include at least 1 custom picture. (We will then promote these on pinterest)
3. Include a link to Amazon and our Website (Amazon link gives us an affiliate commission unless they replace it with their own. Website link has tracking on it so we can see how many people the bloggers send to us)
4. Include an Amazon Coupon Code for 15% off (Incentivizes Amazon purchases from their audience)
5. Reasonable turnaround time of 30 days

If they don’t agree to these terms, they don’t get a product. Now of course they can agree to these terms and not follow them, but what we are doing is getting a commitment from them. From a psychology standpoint this is huge and we can then reference our agreement afterwards if they miss a step.

If a blogger doesn’t post their review in 30 days, then we have a 3 email follow up sequence that is sent to them over the next 3 weeks. When I looked at what Marian was doing, she was blasting a template follow up email every day to the bloggers who didn’t post within 30 days. Literally some bloggers received the same email from her 15 times. That’s harassment and is a quick way to get bloggers blasting you on the internet. Now, we use a more sophisticated approach of referencing the agreement and telling them that if they refuse to post a review they will be blacklisted in our system. Nothing aggressive, but all true and strategically written to elicit a response from them.

After the review is posted, Marian cross references to make sure they completed each of the steps we were looking for. If they didn’t, she kindly follows up with them to ask for modifications. When a blogger does a quality review, she enters their email into a special hidden page, which automatically sets up a follow up sequence for them to continue reviewing more products for us. This process will continue to offer them new products automatically as long as the reviews they are posting are high quality.

Now we are weeding out all the bad bloggers and building a list of the good bloggers. Each blogger is then tagged in the system so we know exactly what products they have reviewed and which ones they have not reviewed. Now instead of always prospecting, we can do targeted email blasts to get tons of reviews at once from the blogosphere.

In the world of PR, there is a strategy called an embargo. This is where you release a little bit of information on the story to a bunch of reporters, but tell them that they can’t post the whole story on the news outlet until a specified date. The purpose of this is to line up a whole bunch of press that all gets published at the same time and causes a media firestorm.

We can now apply the exact same principles to product reviews with bloggers. When I come out with my next product, I am going to stage a blogger review embargo for about 30-40 days after the initial inventory hits Amazon.

We’ll get our inventory in and start making some initial sales. Then we will do a blast email campaign out to our high quality bloggers seeing who is interested in reviewing this new product. Anybody who says yes then automatically gets sent to a page where we lay out the terms of the embargo (Aka. Review must be published on X date). We’ll then have these people in a specific email list so we can follow up with them and make sure the reviews are all posted on the right date.

Now we have a product that is about 30 to 40 days old on Amazon. It’s picked up a good amount of sales from our initial launch and it’s starting to move up the keyword rankings. All of the sudden in one day 50 blog posts flood the internet reviewing it and saying how amazing the product is. Each blog post has custom pictures and coupon codes which send hundreds or maybe even thousands of visitors to either Amazon or our website. Even if only a small percentage purchase, Amazon sees a flood of activity going on and will increase our rankings. We can then take all 50 blog urls and start approaching press websites to show credibility and then get them to buy in on it as well.

 

Slack Communications

Slack isn’t a tool I developed, but it is a software that I have recently integrated into the company and have been getting great results with. Basically it’s an internal company communications system. Instead of me having individual conversations with everyone on Skype, all of the team members are now able to have open communications with each other via Slack.

We have a general chatroom for company wide announcements, random chat room for non work related conversations, a marketing space where Iris and Marian can collaborate, and a bunch of other cool features. I’m really trying to build more of a company culture through Slack and use it for team building. Instead of everyone being on their own island, they are now part of a team.

Starting on Monday when I get back, I am going to be doing weekly 1 on 1 meetings with each team member. This way we can stay on track of the previous week’s accomplishments, solve any lingering issues, and get on the same page moving forward into the upcoming week. I’m going to start having them each share their big wins for the week in Slack as well. So Marian will share the newest blogger reviews links and Iris will share the newest Youtube video links and Caecilia can share customer testimonials. This will give everyone a much more holistic view of all the awesome stuff going on in the company and it will give me more opportunities to publicly praise them for doing a great job. When we get our social media manager on board, this will be the perfect medium for her to source as much content as she will ever need.

Locking in Caecilia

During the last 2 weeks of August, Caecilia failed a bunch of her KPIs and received a warning. She is my rock right now so it’s essential that she is performing at the top of her game every week. When I asked her about what happened, she told me she got caught up in family life and work with her other client.

I immediately started probing. I looked at her time sheets and saw that she’s been working about 30-35 hours per week for me. I wanted to know how many hours total she was working per week including other clients. She said she was working about 50-55 hours total and only had the one other client. When I asked about her ideal work life balance so she could still be a great mother, she said she was happy with around 50 hours per week of work.

We’re moving into a high growth period in the company so I knew I needed to lock her in to me full time. I asked her straight up how much her other client was paying her and she said $5 per hour. She’s been working for me for 3 years now, I completely trust her, she plays a vital role in the operations of the company and is pretty much irreplaceable to me right now…and I was only paying her $3.50 per hour. Shame on me for not appreciating the importance of her role in the first place. I couldn’t imagine what I would do if I lost her.

So I made a proposal that I would increase her salary to $5.15 per hour, which would come out to around $6 per hour each month she hit her KPIs Bonus. The only caveat was that she would need to put in her 2 week notice with the other client and work solely for me. She needed to discuss with her husband first before making any decisions. Within 2 days she got back to me and accepted the offer.

With the exception of the Freight Calculator, everything from Locking in Caecilia to Implementing Slack, COGs Analyzer, Amazon Ads Tool, Blogger System Overhaul, and Deciding to Move Outside The US has all happened within the last 9 working days.  From August 24^th when I got back from Camp Maverick until today, September 3^rd when I’m leaving for Vegas. I know I can’t keep this pace up, but it’s been one hell of a spurt of productivity since I’ve been back.

 

Current Masterminds

Masterminding is one of the absolute most important activities I do on a weekly basis. They keep me hyper focused, accountable, and provide a constant stream of new actionable ideas. Right now I’m a part of 3 different masterminds.

NextCommerce: This is with all of the ecommerce people in Maverick Next. I love that this mastermind is not just Amazon based, but more ecommerce in general. I find that learning only within your niche is very limiting so it’s important to branch out in other general areas and then apply those same types of ideas back into your business.

Nextcellerator: I was just added to this mastermind so I haven’t had the opportunity to attend a meeting yet. However, this mastermind is focused on taking the people doing over $250,000 per year and scaling them up to $1 million. Basically it’s a support group for implementing all of the business building and management tactics taught in Traction. Essentially everything I spoke about above with building a culture and having weekly 1 on 1 meetings, setting up KPIs, etc. In the next 6 months I know I am going to be doing a lot more hiring so this will be the perfect support group to help me through that process

ASM Aruba Mastermind: A couple of the guys from the Aruba trip reached out to me to see if I wanted to join their mastermind. I was skeptical at first because I’m already a member of 2 other masterminds and I’m starting to take my time extremely serious. So I jumped on a call with Jim the coordinator and basically interviewed him for about a half hour to see if it was really worth my time to join with them. I’m happy I did because I had my first call with them today before my flight and it was incredibly valuable. The group has a wide range of experience with some people on the lower end doing only $10K per month and a couple on the higher end doing over $400K per month. Normally that wouldn’t be a good thing because it’s so hard to relate to each other’s current situation, but they have been very specific about who they let in to the group so every member is a value add. One of the biggest take aways I got today was from Jessica who is doing similar revenue numbers as I am and recently hired an “Online Business Manager.” This person is essentially a COO and runs all of the daily operations in her company and goes out and hires outsourcers and manages everything for her. All she is focused on now is new product development. The COO works about 20 hours per month to manage it all and gets paid a salary of $1,000 per month.

She told me everything she did to hire this person and what certifications and experience she was looking for. She also gave me her job posting and a copy of the actual contract they signed together. I’m going to keep track of her progress with her hire for a couple months before pulling the trigger, but to get someone like that on my team would be invaluable.

 

Preparing for 4^th Quarter Madness

Last year I was totally caught off guard by the demand surge in Q4. With Thanksgiving, Cyber Monday, Black Friday, Christmas, and all of the other consumerism going on, people will buy anything. This year I’m prepared.

Well, I’m actually a little behind schedule because of all my traveling. I pushed off inventory ordering a little too long so a few product lines might be a little tight on replenishment, but overall I think we’ll be ok. If we do face any stockouts it will only be for about a week maximum, compared to last year where the west coast screwed me and I barely had any products to sell from December 9^th to the end of February this year.

My method for demand projections was much more sophisticated this year compared to last year. What I did was take all the sales data from last August to December and graph it for each product line. It was immediately obvious that demand for every product line spiked on October 31. This makes complete sense because Thanksgiving is at the end of November and people want to give it a couple weeks for shipping just in case.

After October 31 hit, most product lines spiked demand by 2 or 3 times and held that demand until I stocked out. So to come up with my projections, I took my current inventory and my average sales per day and assumed constant demand until October 31 so I could come to my estimated inventory levels on the day things start to spike. From there, I looked at Google Trends for the main keywords for each product line to see how popular the product was during the 4^th quarter. Based on the trend lines, I estimated 2x, 3x, and 4x demand for each product and I assumed that demand would last for 70 days after October 31. The 70 days takes us into January which of course is not realistic because demand will slow down after the last minute Christmas sales, but I used that number so I could ensure I had enough inventory to last me through to about February.

Next I calculated 4 different potential revenue numbers. The first was that across the board each product line doubled, the next was tripled, followed by quadrupled, and the last number was a mixture based on my Google Trends expectations for each product. This gave me my best case, worst case, and most likely scenarios for the 4^th quarter sales. In my worst case scenario, I think I’m going to do at least $500,000 in sales!

After basically completely missing out on January through March, I didn’t think it was going to be possible for us to cross the 1MM mark this year. However, with the way the 4^th quarter is shaping up, I think we will have a very good chance of crossing that milestone.

The next step after projecting was to make sure that no matter what we had enough inventory. Even with the loans from the bank and the biweekly payouts coming in from our current sales, it’s looking like I am going to come up about $20,000 short on the amount of money I need to order sufficient inventory. That number is still a question mark though because the shipping expenses are still a variable.

The other day I went out and sat down with a couple different banks to see if I could secure additional financing ahead of time. My meeting with Beneficial Bank went very well and they basically said they would be interested in buying out my loans from Citizens and then giving me an extra $20,000 on top. This is of course assuming the application process went well and they would want me to move all of my banking over to them. After I got that offer, I called up Citizens and told them I was shopping their rates and to see what else they could do to help me out.

Unfortunately, the Citizens thing dead ended because MRI is still less than a year old and loaning money out to Hyacinth is too risky because they only have last year’s tax returns to go on. Amazon has also offered me a loan for $19,000 but the interest rate is very high on it. It would cost me about $1,000 just to get the $19,000. It’s an option on the table, but not a very attractive one. Switching to beneficial is also a potential, but again not super attractive because switching banks can be a bitch.

Right now I’m working on figuring out the shipping expenses and seeing what product lines we can consolidate together to make things cheaper. Once I have a legitimate pulse on my costs, I can move forward with the extra financing or not.

New Products For Christmas

After seeing my projections for 4^th quarter, I decided that it would be even better if I added 2 new product lines in time for Christmas. Again this is where I was a bonehead by not placing my orders sooner due to travel, but I think we will still get them in on time. I was seriously looking into Grill Lights, Burger Presses, and Salad Spinners as potentials before I left for Europe. Due to timing though, I knew I wouldn’t have the resources to fully launch any of those by Q4. Instead, I decided to partition out the Skewers into their own product line and the Spatula into its own product line. The only thing I really need to do to launch these is to design packaging for them and we are good to go.

Another thing I’m looking into right now is rubs and spices sourced in the USA. Whenever I tell people I’m in the BBQ business, they always ask me about what kind of sauces we have. I’ve never wanted to go that route because I don’t want to deal with the headaches of food spoil. However, one of the conversations I got into during Camp Maverick totally changed my mind on this subject.

Right now we are constantly looking for new customers. By adding spices and rubs (long shelf life), we can add more of a continuity element into the business and start retaining our customers for the long term. This is such an obvious strategy and something I advise people on all the time. Sometimes the solutions are right in front of your face, but you’re too close to your own business to realize them. Another great recommendation I got was to partner up with Omaha Steaks as an affiliate.

Speaking of Camp Maverick…

As you can imagine, the camp was absolutely epic! I got food poisoning the first 2 days so it cut into my networking a little bit, but I pulled through and had a blast the 2^nd two days. Some of the highlights that came out of the camp

• Cleared the air with Shane about the ASM 4 launch debacle
• Hung out with Tucker Max and Mike Brubeck (his company imports 24 tons of marijuana into the US per month) and got a lot of relationship advice. It started out with Tucker helping Mike strategize on how to find a wife since he’s 34 and looking to settle down. Then it expanded into some advice for me and this guy Dustin as well.
• Learned a ton from Cameron Herold about PR and the ups and downs of entrepreneurship. Cameron is the guy that took 1800gotjunk from around 10 million per year to over 100 million in only a couple years. Now he’s the business coach for super successful CEOs running 8 and 9 figure businesses
• Met Dan Go, who runs a large fitness company. He lives in Toronto so I introduced him to my buddy Trevor from Blacksmith to help make that connection
• Met the owner of Nature Wise, which is a 14 million per year supplement brand. Starting talking about exit strategies with him and then introduced him to my friend Jock who is a business broker. If David decides to sell, that would be a huge connection I made.
• Spent a good amount of time with Andy Nulman. He was the CEO of the just for laughs comedy festival in Montreal, has exited multiple business throughout his life (worth over 100 million), and actually teaches a class at McGill University. I spoke to him about Tim Murdoch and secured an introduction between the two of them as well.
• Jason Hanson from shark tank was there. He was the ex CIA agent that runs an escape strategy boot camp. He tied us up and taught us how to escape from Gray Tape, Zip Ties, and Rope. Really cool experience

Current Product Issues

Right now I am dealing with way more product quality issues than I would like. We literally have issues going on with 6 out of 9 product lines at the moment! When shit goes wrong, the stars align to make sure it all syncs up.

Grill Brush and Thermometer: These products don’t have quality issues per se. What actually happened to them was they were cannibalized by the market. New models were developed for both product lines and we were slow to react. In fact, we didn’t react at all. I ordered a ton of inventory for both products because I wanted to have enough to make it through the summer. That estimation assumed demand would be the same this summer as it was last summer. When the newer and better models hit the market, my demand dropped. Now I’m stuck with a ton of inventory and I can’t roll out a new model until I either liquidate it or take a loss.

I don’t want to take a loss because I’m dealing with thousands of units. Right now, my strategy is to drop my prices as low as I can to still remain somewhat profitable on them while at the same time offloading as many as I can during the 4^th quarter. In January, we’ll assess our inventory levels and the market and determine a strategy moving forward so I can make sure we have top of the line models out there for the summer.

This type of product line cannibalization really hurts momentum. By the time I see the new models out there, it’s already too late because my competitors have a good 3 months advantage on me in the market place. To ensure this doesn’t happen again, I need to build some type of follow up process with my manufacturers so we can stay on top of new developments every month. Ideally, if I can get a product development person on board, part of their job could be to stay on top of market trends.

Temperature and Smoke Magnets: Everybody always complains about everything being made in China, but the USA is just as bad. We are crushing through magnet sales right now selling over a thousand per month. The magnets are supposed to be outdoor magnets that can withstand rain and sun shine. Apparently that’s not the case. The magnets are really just a sheet of vinyl laminated to a magnetic backing. The glue used for lamination is incredibly weak so people are reporting the magnets just falling apart after a few days of being outside.

When you are selling at the volume we are selling right now, this type of error is catastrophic. The 1 star reviews and negative feedbacks are pouring in right now. It’s gotten so bad that I completely changed the product descriptions on both pages to be a simple FAQ about what is going on and how best to treat the magnets. Everyone sees the 1 star reviews on the page, so I figure why not hit them head on and explain what we are doing to solve the problems.

I’ve also pushed heavily on Tina and I’m forcing her to source a new magnet factory for me. Tina works for Astro Dynamic, which is a local print shop. I recently found out that they were just subbing us out though to some other magnet factory. I’ve got a lot on my plate right now so I basically told her that she better find me a solution to my problem or we’re pulling the business from her.

Grill Sets: Our most recent batch of Grill Sets also had some quality issues. I’m not sure what the specific quantity was, but a portion of grill sets missed the buffering portion of the quality control process. This means customers were receiving spatulas and tongs with sharp burred edges on them. We went through a flurry of about 50 people freaking out about it and we had to issue a lot of refunds and exchanges. Things have settled down on that front, so I think we are in the clear. Overall though, this can’t be happening. I came down pretty hard on Tracy about the quality issues so they are comping me on 100 grill sets and they are paying extra special attention to our next batch to make sure the quality is there.

Kabob Sets: When I ran my sample Kabob Set through the dishwasher it rusted. My manufacturer rep Anson told me that it rusted because they used a lower grade metal for the sample. On mass production they would use stainless steel. We then got into about an hour long conversation about dishwasher safe being a requirement and I was assured it would be ok.

Now after selling over 1,000 kabob sets and advertising them as being dishwasher safe, I’m receiving reports from customers that they are rusting in the dishwasher. You have to be fucking kidding me! When I spoke to Anson about the issues, his response was that they don’t have dishwashers in China so he didn’t know. I even copy and pasted his direct response about them being dishwasher safe into our conversation. It turns out that they did use stainless steel in the production, but it was a lower grade stainless steel that doesn’t hold up well in the dishwasher.

I basically told him that this was his 2^nd strike. If he wanted to continue with a long term relationship them there couldn’t be any more fuck ups. I’m not the materials expert. My job is to ask the right questions and his job is to find the answers for me. I let him angle around to save face, but he knows the relationship is on the rocks right now. They had already started manufacturing for our 4^th quarter replenishments, so I made them scrap it all and start over with the new higher grade stainless steel.

I then removed all mention of dishwasher safe from the Amazon listings and email communications. The problem is that it’s written in big font on the back of the packaging that it is dishwasher safe. Now that I’m thinking about it, I might as well expressly communicate via email that they are hand wash only so I can avoid any other future issues until we turn the inventory.

Overhauling Our Marketing Funnels

I’ve started mapping out how we are going to completely overhaul our marketing funnels. We have a ton of infrastructure in place that is being underutilized right now. The new way it’s going to work is going to be very logic based email marketing. All advertising is going to be driving toward top level opt ins on broad category based interests such as food. Right now the top 3 funnels I am going to work on are the recipe book, the temp guide, and the smoke guide.

Once they are in my email lists, I can then tag them and segment the lists to send specific offers to. For example, we could send people a couple youtube videos about steak recipes and then follow up a few days later with our Omaha Steaks affiliate offer. We could tag people so we know which products they purchase and what would be good to offer them. For instance, I already know that people who bought our thermometer are 30% more likely to buy the meat hammer. We can use this data to our advantage in very targeted email campaigns.

The possibilities for logic and automation are huge right now because we have so many product lines. However, this is no small endeavor. I’m estimating it is going to take me about 3 weeks of focused work to put it all together the right way. Getting it all set up is just one part of it though. To manage this thing is going to be a job in itself, so I’m also going to have to hire an email marketing person.

Here’s an example of what I envision the Recipe Book Funnel to look like:

At the top we have traffic sources that go to a recipe book squeeze page. When they confirm their subscription to the list, they are immediately offered the chance to buy a physical copy of the book. (Just need to format it for Createspace to sell physical copies). Regardless of the decision they make, they receive a content email a few days later that includes a youtube video involving really good steak. A few days after that, they are offered a special deal on Omaha Steaks. Then we go back to some content emails, which lead up to an offer for the Temperature magnet 7 days later. If they take the temp magnet, they are immediately upsold on a special deal for the digital thermometer. We then go back to some content emails that build up to the Wood Smoking guide offer 7 more days later. Again, if they take this offer they are immediately upsold on the Smoker Box product.

This whole process will take about 14-20 days to complete. At the end we will offer for them to join the VIP list and we will move them over to the general list for lower frequency mailing. Throughout the entire process we will have the ability to tag them based on the actions they have taken. We can then use those tags later when segmenting the list for other types of campaigns.

Another awesome idea I had was to overhaul the recipe book. The recipe book gets offered for free to every single one of our customers. That’s a huge touch point, so what I’m in the process of doing is creating banners for every product funnel we have and sticking them in to the footer of the recipe book. Each product has an evergreen 20% off coupon funnel so essentially what I am saying is that if you buy one of our products we will continually offer you 20% off anything else as long as you get on our list.

This is going to be a huge strategy for increasing our list size and making sure everyone that buys from us gets on it. We’ll still be profitable, but at a lower margin for the repeat business. That’s ok though because now instead of having 1 or 2 Cave Tools, most people will have a whole bunch of our products. All the sales will also be funneled through to Amazon so we will increase our rankings and also manipulate the “Customers Who Bought This Also Bought This” section.

After they go through those funnels and buy on Amazon, we then start tagging them in our email database and directing their future purchased back over to our website.

As we sell to more people overall the recipe book gets that much more exposure. That means our product funnels, Omaha steaks offer, vip club, social media channels, and all the other offers get that much more eyeballs on them. With this change alone, I think we can take our email list from the current level of 2,000 people to over 10,000 people 6 months from now.

Now imagine the type of power I can have with that kind of list. Take our current thermometer issue where we are suffering from rankings and sales because of newer models out there. If we had a fully tagged list of 10,000 people and knew that 9,000 of them hadn’t purchase the thermometer yet, this is an example of what we could do. Segment the list into groups of 1,000 people each. Create a different coupon offer for each group of varying discounts. Then each week for 9 weeks we could mail out the offer to each group of 1,000 people and totally blow through all of our excess inventory and still remain profitable because we would be controlling everything. Even if only 5% of people took the offer, that would still be a movement of 450 units which would be plenty to spike our rankings for a targeted keyword on Amazon and let the organic sales take over.

Stoicism: the endurance of pain or hardship without a display of feelings and without complaint.

I was first introduced to Stoicism by Ryan Holiday in “The Obstacle is The Way” and then further explored the subject when I read “Meditations” by Marcus Aurelius.

Whether they know it or not, all successful entrepreneurs have to have some degree of stoicism in their personality.

In my 3.5 years as a full time entrepreneur I’ve gone through some serious peaks and valleys. That’s just the way it is and you have to expect setbacks as you grow and your business progresses.

As the title of the post suggests, I’ve been enduring a ton of shit. Over the last 50-60 days it’s been almost like the stars have aligned to cause catastrophe after catastrophe to just wreak havoc in my business and personal life.

When I look at the past couple years of writing on this blog, I think I’ve tended to write mostly about the positive things going on. I’ll touch on the negatives, but I never truly do them justice. I’ll elaborate on a big win for 4 pages, but when it comes to some giant setback (and there have been many), I’ll normally knock it off in a few paragraphs max and move on.

I don’t brush over the setbacks because they’re not important. In fact, they’re probably the most important part of me keeping this whole journal so I can reflect and learn. It’s just that for me it’s very hard to dwell on the negatives. I just want to shrug them off and move on, not spend 6 hours writing about them and reliving through it.

I can honestly say that this has been one of the toughest valleys I have ever gone through. I’m struggling to find a way to put everything down on paper in a way that will truly portrait how difficult and stressful this valley has been for me. One thing after another compounding on top of each other really fucked with my psyche.

Don’t worry though, there’s always light at the end of the tunnel and I’ve had a few kick ass wins towards the tail end here.

Promoting Amazing Selling Machine as an Affiliate Round 2

Last year in September Jarod, Shane, and I promoted ASM as affiliates and we totally kicked ass. After all expenses and our 3-way split we ended up each coming out with around $20,000 in commissions.

Between September and April a lot of things changed. For starters, the 3 of us had our break up. I’ve written about the break up here on the blog already, but basically Jarod felt that Shane wasn’t contributing anymore and he was too distracted with other things he had going on to really commit to our partnership. A lot of this was true, but a lot of it was also Jarod’s jealousy of Shane’s success and Jarod’s own insecurities.

I played things in the middle during the break up and retained my relationships with both guys, but Jarod caused a big rift with Shane. Even though they made up later, it was one of those things where their relationship was cool on the surface but damaged down below.

When we got to Vegas in February, I hung out with Jarod and his wife Shannon most of the time. Shane was too busy doing stuff with Matt and Jason to really spend any significant time with and he was still bitter about the way things went down. By default I pretty much sealed myself in as being partner’s with Jarod.

At this time in February I still hadn’t committed to doing the ASM 5 launch again with Jarod or Shane. I was planning on launching my own course with Ricky on Udemy and competing against ASM. As the conference went on, I decided that I was going to do the Aruba Mastermind trip with Matt and Jason.

I remember being out to lunch with Jarod and Shannon and telling them that since I decided to go on the trip with the ASM guys I thought it would be a big conflict of interest if I was also going to launch my own competing course. With my course now out of the picture, it made sense for me to partner up with Jarod again to do the ASM 5 launch.

We discussed if it was worth it to ask Shane to come back in again as a partner. In the last launch he didn’t do too much of the operations/labor involved in promoting, but he did have the network and some extra clout as Jason’s brother. Both of us agreed that we couldn’t do as well again without Shane and it was worth the extra split so we asked him to join up with us again.

For a couple weeks he held us at bay and kept saying he wasn’t planning on promoting the launch. Eventually we found out that he partnered up with Dave Kettner’s team. This caused an issue because Shane still had access to all of our stuff we put together and our whole community of ASM Elite member’s so he could see everything we were doing and he was competing against us.

Since he was competing against us, it made sense for us to ask him to leave the facebook group. Jarod and Shane weren’t on great terms so I had to ask him to leave. He seemed to understand and was cool with it. But as soon as he was out of our group he changed the passwords on the Jason Fladlien membership that we all purchased together for $3,500 last launch. Fladlien is the top affiliate so basically Shane took away our ability to spy on his launch. This wasn’t cool because we actually paid for that access. When Jarod confronted Shane about it, things got heated and you could tell there was a lot of animosity and both of them felt like they got the short end of the stick.

So that’s the whole sociopolitical side of things leading up to the launch. On the launch preparation side I was dealing with my own set of issues working with Jarod.

The price of the course went up from $3,500 to $4,995 which was a significant increase and meant we needed to change our strategies up. We needed to bulk up our bonus packages and do a much better job of relationship building with our prospects if we wanted to sell them because it was a higher ticket item.

Of course bulking up the bonus packages meant that I personally would have to add in a ton of new training material. Jarod can manage some software development, but when it comes to being innovative and developing marketing strategies I don’t think he’s ever had an original idea in his life. He’s constantly chasing the ball and basically just relies on me to share things with him. The way I would describe it is that I’m the type of person that pays it forward and would never want to be leaning more on the take side than the give side. Jarod is the type of person that consciously tries to manage it in his head where he never shares more than he gives so that way in his head he is always making out in the relationship.

So when it came to the bonus packages, I was pretty much responsible for creating everything and teaching all of our students (and Jarod) a bunch more strategies. It was more work for me again, but I figured with the increased price tag and one less person to split with, the commissions I would make would be worth it for me.

As far as the launch itself went, I was the leader. As the marketing guy, I came up with our strategy again and the steps for implementation. But literally the entire way for weeks leading up to the launch I had to keep fighting with Jarod over everything. He kept questioning me on every single step because he couldn’t conceptualize the strategy. This was basically the exact same strategy we employed last time to crush it in the launch. But every step of the way he kept wanting to follow traditional strategies like running ads to cold traffic because “That’s what everyone else does.” The problem with following what everyone else does is that we don’t have any of the assets in place that major affiliates do, which is why I had to create a totally different strategy in the first place.

It was incredibly frustrating because I had to explain myself over and over again every step of the way and show him why all of these traditional methods wouldn’t work. The only way I can explain it is like having a little kid ask you Why 50 times in a row over something that should be clear cut.

 

By the time the launch finally came around, it was like an all-out witch hunt. Right away we received a violation because our domain name was asmmastery.com and they updated the TOS so no affiliates could have “asm” in their name. We had 24 hours to take down the site or we would be suspended from the launch.

So we bought a new domain name and transferred all of the content over so we were in compliance. We also held a webinar for our sub-affiliates to let them know about the change. Our sub-affiliates were basically a bunch of people that we signed up that would promote the course using our bonus package and we would split the commissions with them. They each had their own pages on our site as well so we had to redirect all of those links to the new website.

We replied back to ASM that we fixed everything and they were cool with it. Then about 8 hours later they told us that redirecting the site was not enough. Even though you couldn’t go to that old domain anymore, they wanted us to take it down completely. Basically this was their way of fucking up all of the previous work we did and all our sub affiliates did because any links out there on the internet wouldn’t even redirect anymore.

We weren’t happy about it, but we complied and were reinstated. Right after we were reinstated we received another warning because one of our pictures was “misleading” to them. The wording was cut and dry about what ASM was offering and what we were offering, but they thought it could be confusing so we had to change the image immediately or be suspended. This exact image was used by at least 3 other affiliates that I know of and was prominent on their sales pages. Again, we changed the image immediately and we were back in business again.

Keep in mind each time we received these bogus warnings they would suspend our account. For a 7 day launch each day counts so this was huge. We would see sales come into our account and then they would just take them away from us. Sometimes we would make sales during the couple hour period where we were suspended for bull shit and then they would just not count them towards our commission. It was ridiculous.

Meanwhile, I’m working 12-15 hour days trying to keep up on the launch, Hyacinth, and Cave Tools. Jarod still has a day job so every time I needed help he would hide behind his job. The work split was totally all on me, but at this point we were in the middle of things so if I stopped then neither of us would make money. I just had to push through and say fuck it.

At this point we are about 2 days into the launch. We are running our facebook robot and messaging people just like we did last launch. Last launch we did extremely well messaging Robert Kiyosaki people and converting them to our group so we scraped a list of his followers and started messaging them. One of the messages went to Dave Kettner and he freaked out. This time around Robert partnered with Dave so basically he was pissed that we were poaching his prospects.

There is nothing against TOS about this, we were simply presenting an alternative offer to people and letting them make a decision. But I became good friends with Dave in Aruba and on a personal friendship level that’s a dick move. I agreed with him and gave him my word we wouldn’t send any more messages to Kiyosaki people. The way I see it is that money gets spent, but relationships last. My relationships and reputation to me is so much more important than money.

I took me an hour to smooth things over with Dave. During the beginning of our conversation he was kind of heated and he started saying some things that were very telling. Specifically he made a comment about how he’s heard about how Jarod and I run our business and he can’t believe how immoral we are and that we resort to scumbag tactics and a bunch of other stuff like that.

At this point we hadn’t done anything wrong and at every step of the game while ASM was after us we were just complying and doing whatever they said. But there were a bunch of rumors going around that I had no clue what they were and it was damaging my reputation. The rumors were most likely started by Shane after the fallout with Jarod, but there is no way to prove that.

Next thing you know Jarod starts direct messaging Jason during the launch. Jason is in the middle of a multi million dollar launch and probably has a ton of shit on his plate and Jarod is calling him out and blaming Shane for trying to shut us down. He’s then calling up their CFO and complaining to him and making threats and all sorts of stuff without even telling me he’s doing it.

Basically I’m in damage control mode trying to speak to everyone and clear things up and Jarod is going out and just totally handling things the wrong way and causing more enemies for us.

Now we have a ton of people inside ASM super pissed off at us when less than a month ago we were all best buddies in Aruba hanging out. They’re just looking for another way to shut us down again. Jarod had started a Rafflecopter campaign to promote the launch. Basically it’s one of those things where if you share the link on social media you get “points” and at the end we would give a prize to the person with the most points. It’s supposed to induce virility to your campaign. Again, nothing  against the TOS for doing this, but they shut us down for another 24 hours over it because they felt like it.

Jarod calls the CFO again and prints out the TOS and timestamps it so they can’t change any wording around. We get reinstated again but are told any more violations and we are completely done. Keep in mind we still haven’t had a “True” violation yet. It’s all just been this crazy witch hunt.

Next thing you know, one of our members from ASM4, Sandra sends us a message. Her friend who she has been trying to get into ASM for months purchased the course through our link but was conveniently added to Dave Kettner’s group instead for some reason. She sent us the entire conversation for proof of the person asking to be in our group.

So now they are literally just taking sales and commissions away from us. We send the proof over to support and instead of transferring her friend over to us like they did last launch, they send a message to Dave to let him know we are stealing sales from him. This is after I smoothed everything over with Dave and we were cool again. So then he writes a letter to the girl just completely bashing us and making all sorts of ridiculous claims about how we are liars and cheats.  The girl thought that was very unprofessional and sent us the entire letter and still requested to be added to our group.

So we got the commission for her, but now I’ve got Dave bashing us. I ended up having a whole other hour or two conversation with him to clear things up and he admitted he was just pissed and should have contacted me first before he blew up. Again, tons of damage to my reputation was caused by all of this because in a state of anger he was freaking out and bashing us to ASM as well.

Next thing you know the final blow comes in and ASM says some of the wording on our sales letter was misleading and that this was our final violation so they were shutting us down for good. At this point I could give a shit about the launch and the commissions. All I cared about was my reputation and I felt like I was in constant damage control mode. The amount of stress I was holding during this month was ridiculous.

So finally I messaged Jason myself. Just like with Dave and everyone else, I smoothed everything over and made sure we were on good terms. Jason appreciated me reaching out and having an honest conversation with him and handling things like a man.

The next day we get an email from their lawyers saying that even though we were suspended they would still let us keep all of our commissions and everything. I’m pretty happy with the outcome and feel like my diplomacy was rewarded. I didn’t care about getting the last laugh, I just wanted things to be over and done with.

A couple hours after that email I get a phone call from Jarod and he tells me about how he really “Stuck Them.” Since Dave Kettner helped shoot some of the videos for the course, Jarod was trying to get them on Libel and sue them. He had spoken with his lawyer and because Dave made false statements about us and he was paid by ASM to work on the videos, that constituted libel. Every time I was trying to stick a fig leaf out and end things he was always out to get the last laugh and keep fucking things up.

Fast forward to today and now I have to coach these new members we added and I have to put together all of the bonus material. It made sense for me when I was expecting about 25-30K in commissions, but now at 10K for the amount of work involved it’s just not worth it to me. But I have to do it anyways.

Part of our bonuses are weekly coaching calls, which is supposed to be Jarod’s responsibility since I’m doing everything else. But he’s been pawning a lot of that shit off on me as well. Again, I’m in the situation where I can just hit things head on a cause a confrontation or I can just bang out what I need to do and get over with it. From a pride standpoint I want to just freak the fuck out on him and end my relationship, but in the long run that’s not the right thing to do. I’m just going to put my bonuses together and push the weekly calls on him and that way we do right by our students and live up to our promises.

After my obligations are over with, I’m just going to slowly move away from Jarod and keep doing my own stuff. By not causing a confrontation, the tension will diminish over time and if I ever need him for something I can keep that relationship open.

Firing Dorothy and Lessons Learned

Towards the beginning of May, right at the start of our busy season, I had to fire Dorothy. Dorothy was in charge of everything from social media to blog posting, blogger outreach, press releases, youtube video submissions, etc. This was a huge blow to lose her. She was great for the first 4 months (Or at least I led myself to believe she was), so what happened?

Basically she just stopped working for a full month and was sending me bogus update reports about work she didn’t do. I was too busy to check up on her work and I had too much trust in her that she was doing a good job. She most likely picked up another job and was just getting paid by me until I finally figured things out.

I did a full audit on her work and from what I could tell she maybe worked about 4 hours for the entire month of April (and got paid her full salary). She was working just enough to show some activity so she could bluff the rest and still get paid. Even the work she did complete was done half ass or started but never finished. Outside of the employer/employee relationship we had a lot in common and would probably be friends if we lived in the same city. So why would she do this to me? What would lead her to basically steal from me?

I don’t she think she’s a bad person. After reflecting back and taking an objective view of the situation, I actually take full responsibility and believe that I led her to do this to me. I did so many things wrong with her that I’m actually surprised she didn’t do this to me earlier.

Perceived Time Investment:

I hired Dorothy back around November and it took me a good couple months to get her trained to be my content marketing manager. In the beginning I used my training materials I created when I was running my Penn State internship program. However, those trainings were somewhat outdated and they were too process oriented instead of strategy oriented.

By process oriented, I mean that my video tutorials were focused on one specific operating procedure/process and that’s all they were good for.  As I started training Dorothy I reevaluated my training methods and started building tons of strategy oriented trainings.

Basically if you go into our training resource center now, you’ll see about 40 operating procedures geared towards specific processes. These are living step by step documents that can be changed and evolve as our strategies change. In addition to the operating procedures you’ll also find a bunch of videos. The cool thing about most of these videos now is that they are strategy oriented instead of process oriented. For example, you’ll see a video in there about all the different ways to optimize a youtube video, but it won’t be about our specific youtube posting process. This way the process can change but the videos can be used for training on a broad range of applications.

It took me about 3 months to create all of this and get Dorothy fully trained. What I was doing was building a reusable asset, but in my head I associated all that time as an investment in Dorothy. This really clouded my judgement and in my head made me feel that she was so much more valuable than she really was.

Salary + Time Tracking

Leading up to Dorothy all of the outsourcers I ever hired were hourly employees. To do this job the right way, I knew it needed to be a full time 40 hour per week job. So instead of hiring Dorothy on an hourly basis, I gave her a full time salary with the expectation that she would work at least 40 hours per week.

I wanted her to feel like she was not just a VA, but a part of the company. I very naively expected her to work really hard and put in the extra time to make sure everything got done on time. She would routinely take days off in the middle of the week and I was cool with it because she said she would make it up over the weekend. She never actually made the time up.

Usually we use a service like Upwork to automate the time tracking and payment of our hourly employees. However, with Dorothy we used a separate time tracking software that was not linked to her payment each month. The problem with this was that for me to actually verify she was working I would have to manually check the time tracker software. I was way too busy to do this and she knew I wasn’t checking.

At one point in the beginning she didn’t use the time tracking software for a full week and I never realized it. I think she was just testing the waters to see how much I was actually keeping track of her. Once I started checking the time tracker she started coming up with excuses about how it wasn’t working on her computer and it was slowing things down. Then she convinced me to stop making her use the software all together because she was flipping back and forth between her computer and her son’s and didn’t want tracking software on his computer. Again, I had full trust in her so I allowed her to stop tracking her time. As long as I could see that her activity level was up that’s all I cared about.

Firm KPIs and Management

When it came to activity level, I had no clue what that even meant and I’m sure she didn’t either. When I initially hired her the expectations were something like 1 blog post per week, 2 press releases per product per week, 1 youtube video submission, etc. Not once did she ever hit her marks and I even ended up removing press release responsibilities from her all together because she wasn’t a strong enough writer to do them properly. After the press releases were removed, I expected her to just focus more on the other tasks, but that never really happened. In fact, her overall activity level and output on the other tasks went down.

By the time she started not working on me, there were pretty much no key performance indicators in place to measure output and there were no incentives or penalties associated with not hitting certain objectives.

Everything looks so damn clear now that I’m writing it all out. Of course this was a recipe for disaster and there was no way anyone could be expected to succeed in this environment. Think about it from her perspective.

• Manager is too busy to check up on me
• There are no clear requirements on the amount of work I need to do
• There is no way to tell if I’m working or not
• I’m getting paid on autopilot regardless of it I work

What it all came down to is that I was just lazy and way too comfortable with having Dorothy in place. Hiring and training a new person is difficult so I justified everything and turned my back on the problems because I had other stuff to deal with. I knew she wasn’t working at full capacity, but it was still better having her there than to have to hire someone new.

Even when I did my full audit and had my phone call with her to discuss it, I had no intentions of firing her. I was planning on just talking through it and telling her she needed to “Get her activity up again.” How ridiculous is that? This girl basically stole from me and the pain of hiring someone new was so great that I just ignored everything that was happening. Luckily for me when I asked her about it all she just resigned on the spot. She knew she got caught and there was no way to even sugar coat it with an excuse.

Looking back on this whole situation now, the timing was horrible and the impact of losing her really hurt the business, but it needed to happen. I’ve learned so much from reflecting on this experience that I never would have learned. I have a new person in place now named Marian and I’m restructuring my entire marketing program to have performance based incentives.

I always felt like management was easy. You just make sure everyone is doing what they need to do and you’re good to go. But there is so much more to being an effective manager and this whole experience made me realize that I can’t just wing it as a manager. Just like I study marketing in detail I need to learn and properly implement the core principles of management.

Within the next year, I want to start hiring real full time employees in the US and building a true company culture. This is going to require a vastly different skill set than just managing a couple hourly VAs from my computer. People have different personalities and work ethic and different ways of needing to be incentivized and measured.

In order to take things to the next level I picked up the book Traction. The core message of this book is to install your “Entrepreneurial Operating Framework.” These are the principles that the majority of the Mavericks implement to scale their businesses and there are entire groups dedicated towards the application of Traction to your business.

I’ll discuss the Mavericks in more detail in my next post. Basically they are a bunch of impact driven 7 and 8 figure business owners that I now have access to and may or may not be hanging out with in August 😉

Meat Claws Infomercial Tanks

We finished up the infomercial production and aired our 2 week test market in April. The infomercial was shown on ESPN, Fox News, Food Network and Spike TV during the day from 6am to midnight in Tampa, Detroit, Chicago, Evansville and New York and had an estimated reach of 1.2 Million viewers.

Kick Ass Product, Kick Ass Infomercial, Kick Ass Audience size. With all 3 of those boxes checked you would think success was inevitable. It wasn’t. The infomercial failed miserably and we only ended up selling 12 units! I sell 12 fucking units a day on less than 100 impressions on Amazon alone.

For a little while we thought we may have gotten bumped by a bigger advertiser or maybe received tons of horrible air times. Not the case. We looked through the tv logs and everything was executed exactly according to plan. We just flat out failed.

Most infomercials fail and I knew that going in. The video shoot and test market cost me $7,000. I’m cool with that. It’s a small price to pay when compared to the potential upside of succeeding. If I could go back I would totally make the same decision to move forward and do the infomercial. You have to take those kinds of risks so I’m cool with it.

What I’m not cool with is the absolute ridiculous amount of inventory I have now.

Assuming all went well with the test market, the initial purchase from Landmark Direct would have been 10,000 units and I would have turned I think about $20,000 in profit if I remember correctly. At the time leading up to the airing I only had about 5,000 units on hand and some of them were reserved for The View (discussed below). Last Christmas the meat claws became hugely popular and we stocked out because we started selling a couple hundred per day.

I typically have a 90 day supply chain if I ship via ocean and closer to 60 days if I ship via air. The summer isn’t very long so I was in a big catch 22 type of situation. I lost a shit ton of money by stocking out over Christmas so stocking out during the summer was not an option, especially now that I had money from the bank. From a projection standpoint, could I expect similar demand numbers during the peak of summer? Would they maybe even be higher?

I needed to plan ahead and order enough units in case the infomercial was a success (for their purchase and the increased demand in all other channels), the view was a success, and my projected demand over the summer.

I decided to order 15,000 units and ship them via air (Way more expensive than ocean) so they could get here immediately. Approximately 10,000 would go to the infomercial, a couple thousand would go to The View, and with my 3 to 5 thousand units already in stock I would have enough buffer to match demand and then make more ordering decisions on the fly.

Looking back, that purchase order was based on a lot of best case scenario assumptions. But the alternative of low balling it and stocking out would also have been devastating.

As soon as I got word that the infomercial failed, I called up my freight forwarder, Jay, with an urgent message to switch the air shipment to an ocean shipment. This would have saved me literally about $10,000 and given me more time to move my existing inventory before the excess arrived. Unfortunately, when I spoke to Jay he told me the shipment had just arrived in San Francisco and the next day was expected to be shipped to my warehouse. Fuck! I have to say that is my biggest and probably only regret. Looking back there had to be some way I would have been able to meet deadlines and still ship ocean.

I have no clue how long it will take me to move that inventory now so keeping it all in the warehouse in short term storage would kill me in fees. So instead of sending it to the warehouse, we had all 8 pallets loaded up on a truck and shipped cross country to my parent’s house. Shipping them across the country added a nice extra $3,000 to my purchase, but it had to be done to minimize the damage.

Instead of shipping them to the parcel place in Newtown, I had a them schedule a truck with a lift gate on it so they could be delivered directly to the house. A full on fucking tractor trailer showed up in our neighborhood with all the meat claws.

Our driveway goes uphill so I had to work with the truck drive to get each of the pallets up to our garage. He pulled from the front and I used my legs to push from the back. It felt like I was hitting a blocking sled in football practice trying to get those damn pallets up the driveway. Except I was pushing 5,964 pounds (3 tons) of meat claws and $42,000 worth of tied up cash flow and misery up the hill on a 90 degree day.

I could probably launch 3 new product lines with that money. I don’t even want to think about the opportunity cost of what I could be making right now if that money was liquid. I’m just hoping demand repeats itself over Christmas this year and we can start making a dent in the inventory.

On the bright side, my mom helped me break down the pallets and stack all the boxes in the garage. There was also very little damage. I think only about 8 units are unsellable. This is a miracle compared to when I used to receive 1,000 units of grill brushes and when we opened the truck gate about 300 of them were lying on floor and the boxes were all ripped up and destroyed.

Marc from Landmark Direct hasn’t abandoned hope yet on the Meat Claws. According to him, the way things typically work is infomercial > catalogs > retail. Sometimes certain products will work out in a different order though so now we are going to be trying catalog marketing with the meat claws.

I already signed the deal with them and they are working on the graphics and sell sheets now. For me it’s a cash positive opportunity (costs me nothing) because they still purchase direct from me at the agreed upon wholesale rate and the catalog fees are built in to the price they list them at. I’m not expecting huge things from the catalogue marketing but we’ll see what happens. Any time I can make money and increase exposure without having to manage the campaign myself, I’m all for it.

So Much For “The View”

Back in September/October of last year I was contacted about an opportunity for Cave Tools to be featured on The View. I ended up not doing the deal because I didn’t have enough inventory to support that type of campaign. However, I kept in touch with my contact Diana and planned to circle back for this summer.

The requirements from last time were that I needed to have 1,000 units of each product available for them to do a deal on the show. I planned ahead in my ordering and I ordered an extra 1,000 units of meat claws and bbq sets so they could be set aside for the show.

When I followed up in the beginning of the summer to start planning things out I was notified that Diana was promoted and I now had to deal with Teagan. They also let me know that now the requirement was 2,000 units of each product. When you have a 3 month long supply chain, you don’t necessarily have the flexibility in inventory to just spare an extra thousand units for one promotion.

At this point I was already pot committed so I wanted to figure something out because I had the extra inventory. For the meat claws this was around the same time as the infomercial test market so I thought it would be the perfect mix of being on mainstream tv at the same time as the infomercial aired. We negotiated back and forth and they ended up telling me they would feature us on their Must Have Mondays online only segment.

In the beginning everything was structured that I would provide a deep discount deal in exchange for being on The View. Now I ended up with a deep discount deal where I literally was going to break even in exchange for an online only promotion. Not what I planned for but again at this point I figured we would just go through with it and hopefully the exposure would pay off.

The contract I had to sign with these guys to work with them was ridiculous. I discussed this in the other blog post, but basically I was taking a lot of risk and there were tons of penalties in place if any of the units were defective or if shipping wasn’t done exactly to their specifications.

At this point, we are getting really close to the air date of the tv show and must have Mondays flash sale segment. Part of the contract stated that all of our inventory needed to be in their warehouses by 3 days before the show aired. Teagan is completely dragging her ass and isn’t giving me the information I need to ship the products to the warehouse no matter how many times I ask her.

Everything is being coordinated via email to get this deal done. During the day I was attending an ecommerce conference in Philly called SCOE. Turned out to be an absolutely horrible conference and completely hyped up. I literally could have been one of the best presenters there if I was on stage. Way too many amateurs and completely unorganized. One of the presenters even stole word for word and image for image a marketing funnel that Ezra Firestone made and released in his course called social secrets. He just put the exact templates on a powerpoint with his name on it and hocked it as his own shit.

The only good thing to come out of the conference was that I met Dan Roitman and got to hang out with him. I originally met him briefly in Ezra’s mastermind in Vegas and tried talking to him when I found out he was from Philly. He basically just blew me off and seemed totally uninterested in speaking.

When I saw him at SCOE I decided to give it another go and speak to him. Dan is the guy that built Pimsler into the 2^nd largest language learning program in the world after Rosetta Stone. I’m pretty sure Pimsler does in the mid 8 figures every year. He also owns a VC company that goes around and buys up people’s ASM brands. I forget what I said to him when I walked up to him, but I made it a point to discuss monthly revenue numbers fairly early in the conversation so he knew I wasn’t just some newbie marketer that was going to waste his time.

It sounds weird from the outside in to be so open with sharing numbers, but this is very common in the ASM/Amazon community and it’s almost like a grading system. It’s like where are you at? 20K per month, 50K per month, etc. Anyways, once I shared some numbers he really opened up and we actually hung out for all 3 days of the horrible horrible conference. It was basically one of those things where I paid to be there and I knew it sucked but I didn’t want to just leave because you never know if the next presentation was going to be good or not.

So I’m at this hotel for a conference on Wed, Thurs, and Friday. The show airs the next Monday and according to the contract I needed to have my products in their warehouse by that Friday. In between speakers I keep running out to the lobby to open my laptop and check my email so I could get the damn info from Teagan. It wasn’t until Thursday afternoon at 5pm that she finally sent it to me and I was still expected to get it there by Friday.

I’m freaking out and now trying to coordinate a shipment from San Francisco to Los Angeles (8 hours) by myself in the middle of this damn conference and get it done in one day without breaking the bank. Of course every time I call UPS I have to sit on hold for 30 minutes and their people are incredibly unhelpful and rude. I always have my freight forwarders handle the shipments from China and then UPS picks up from the warehouse to take stuff to Amazon so coordinating a shipment like this is a huge project for me and something I never did before.

I finally called Teagan up and forced them to give me an extension because there was no way in hell the products would get there on time. She gave me until Monday. Jim, the guy that owns the warehouse I use in San Francisco was doing his best to help. I would be running in and out of speeches to catch a call with him as we tried to coordinate everything. He even researched uHauls and was going to drive my products down to LA himself on Saturday and return on Sunday just so I could make it there on time. When we costed out his time and the uhaul and everything like that it came out to be like 3 grand just in shipping. That wasn’t going to fly.

Finally I got UPS to do the shipment and get it there by Tuesday and I told Teagan that they were just going to have to deal with it because there was nothing else I could do with such short notice. The whole process was incredibly stressful and was basically piled on at the same time that I fired Dorothy and all this other shit was going on. I was just happy that we got the products there and was looking forward to the show results and coupling them with my huge potential infomercial success.

On Tuesday night around 10pm I got a call from Talisha at the warehouse in LA. Apparently Jim and his guys at the warehouse shipped 990 bbq tool sets and 3,000 meat claws to them. WHAT THE FUCK! According to the contract that’s $10 per missing unit, so that’s $100 right there in penalties. For the extra 2,000 units of meat claws, I would now be responsible for shipping them back up another 8 hours to get back to San Francisco.

Keep in mind I was very very clear with all of the shipping instructions and made Jim and his guys aware of the strict penalties I faced if anything fucked up. Everything was provided in clear written instructions on how to prepare the shipment and how many units to send.

Talisha said they would waive the fine for the extra bbq sets, but we would still be responsible now for shipping all of those units back to San Fran. They are coordinating the return shipment this week actually and I’m expecting it will cost me about another $800 or $900 extra. Whatever it ends up costing, Jim is going to split it with me. I could have pressed to have him pay in pull because they fucked up, but he was going out of his way to help me with looking into renting uhauls and making calls to help figure everything out. I figure this way we just split the pain and move on.

As far as the Must Have Monday segment goes, they were projecting to sell the shit out of our stuff because of all the thousands of viewers and everything that would flock to the page. It turned out to be all hype and we only sold 158 units of each.

So let’s sum up this whole “View” experience. Get all hyped up in September for the show and then not have enough reserve inventory to execute. Plan months ahead to reserve inventory so we could be featured on the show only to be told at the last minute that requirements were changed. Suck it up and go through with the online only deal because there was still huge exposure expected. Go through a crazy stressful 3 day run around trying to coordinate a big shipment on a tight time schedule. Shipment gets fucked up and the online segment barely sells at all. Now I’m responsible for paying to get my products back from them and the overall net result of the deal will most likely be a couple thousand dollar loss.

Technical Issues

The Must Have Monday show aired on Monday and I’m finding a lot of this stuff out towards the end of that week. On Thursday at the end of my work day a little bit of coffee spilled on my keyboard. I’m talking a very little bit and I wiped it up immediately and the computer continued working fine that night. Friday morning I wake up and what do you know? My entire keyboard is fucked up.

One of the letters is basically held down and repeating itself. Not from a mechanical side, but from a circuit side so there is nothing I can do to stop it. After tinkering for about a half hour trying to find a way to type my login password in correctly, I was able to use the finger scanner to get access to my computer. I hadn’t used that thing in over 2 years so I was surprised it worked. From there, I plugged in an external keyboard and was able to locate the drive file for my laptop keyboard and disable it following the steps in an online guide from my phone.

After disabling the keyboard I had to restart the computer so the changes could take effect. That was last time I was ever able to log into the computer. My hard drive was at about 95% memory capacity from all my work shit and for weeks I had been telling myself I would set aside some time to clean stuff off and put it on my external hard drive. I think it just didn’t have enough memory to handle having a disabled keyboard or something because I could never get the laptop to go passed the login screen again.

So by this point it’s about 11am on Friday. Just recently finished up with the ASM debacle, Dorothy quit, Marc from the infomercial is giving me mid test market updates that we are way behind expected sales, and I just found out about the View thing getting all fucked up, and now I don’t have my laptop that I use to run both of my businesses and has everything I need on it. As if I wasn’t down in the dirt enough, you go and pull the plug on my life support.

No time to sit around and sulk and feel sorry for myself so I got in the car and headed 40 minutes away to Best Buy. Of course they don’t sell any Windows 7 computers anymore so I had to buy a Windows 8 touch screen laptop for over $1,000.

I then drive 40 minutes home only to realize that one of the wires was defective. Had to get back in the car and do another round trip of 40 minute drives to Best Buy to get that replaced. It’s now towards the end of the day and I have to set up an entire laptop on a new operating system (Windows 8 is a giant piece of shit) and install all of my software again. Luckily I had set up Carbonite for automatic backups about 3 months prior so none of my core files were lost.

The problem however was that I had so much shit on the carbonite cloud that it took about a full week before I got everything back and downloaded onto my new laptop.

For the entire next week I experienced the true pain of switching to Windows 8 and none of my programs working well with the new operating system. Quickbooks and my printer were the worst with integrating smoothly with Windows 8. Between those two things alone I probably spent a good 20 hours on support phone calls with people over in India that are fucking retarded and make you want to scream.

To be totally clear, 20 hours is not an exaggeration. I had multiple 2 hour phone calls with support reps from both companies literally like every day the following week. We would go over all of the same exact steps and I would have to re explain everything over and over again. They have to follow a specific process so telling them you already did a step didn’t matter, they would always start from the very top of the troubleshooting guide. It was absolutely horrible. After getting off a call with these guys I was just completely drained of all will power to do any work.

At the same time we were also experiencing separate unrelated issues with our router not working. I had to spend a couple hours with those guys as well and they could never figure out what was wrong. We basically just had to reset the entire router and create a new set up of everything from scratch.

This dumb technical shit pretty much ate up an entire week of work for me. Even the work did get done that week was unfocused and scattered.

Everything in this post so far went down between April and May with a heavy concentration in the middle weeks. Between the end of May and today, June 18, I’ve finally gotten out of the damn slump and have a ton of good shit going my way again. For now we’ll cut this blog post off. Next post will be much more upbeat

I couldn’t believe how long my post was in December. I’ve never had that much to write about in just a 30 day time span. We’re now in the beginning of February and things are moving so fast that I feel like if I don’t write them down I either forget them or they become irrelevant.

In December I mentioned the beginning of my partnership with Ricky and how we were planning on developing our own course teaching the concepts of how to manufacture and private label brands. I didn’t really know much about Ricky at that time because I had only met him in Lithuania. I could sit here and write all about Ricky and how he owns two Million Plus per year businesses and how we were planning on working together.

I could write about how he completely opened up to me and shared tons of resources. How much confirmation I felt when I looked at his hiring processes and the management systems of his business and I realized I was already building the same systems into my business. When you’re on your own, sometimes you feel like you have these great ideas and you’re doing everything right, but never really get confirmation that what you are doing is the right thing. To look into a young multimillionaire’s business and see the exact same systems and processes is amazing and lets me know how close I really am to blowing my business up beyond my wildest dreams.

But all of that stuff I could have written about is irrelevant now. I’m on my final day of a 7 day Vegas trip that has completely changed my life. Unfortunately tomorrow I have to tell Ricky we aren’t going to be able to move forward working together anymore.

The course we were building would be in direct competition with Amazing Selling Machine. Granted, the ASM guys are so much more advanced and we wouldn’t even make a dent in their business if we did 6 figures with our launch. But the point is, no matter how much money I could make working with Ricky, I don’t want to do anything to get on the bad side of ASM.

Next month, I’m going to Aruba with Matt and Jason (creators of ASM) and about 30 other 7 and 8 figure business owners for an exclusive mastermind. They are literally going to break down my business with me and help me scale it up rapidly. I’ll get to the details of that whole mastermind later in this post, but the point is that I’m leveling up so fast I can’t believe it. It’s hard for me to decompress sometimes because so much is going on in my life. A couple weeks ago, the idea of working with Ricky was the most fantastic opportunity ever and now it feels like a footnote that I can’t even write about because it’s in my past.

Jason Katzenback and Matt Clark

When I came back from Lithuania, I approached my life and my business from a whole different perspective. That whole experience expanded my mind and helped me think bigger. Before this week in Vegas, I had this goal that I was going to do a million dollars in top line revenue in 2015. It felt like a lofty goal, but the more I thought about it and talked to myself in my head, I knew it was possible. Even if I fell short, I knew I was going to get damn close to that million. Now I just feel like I’m going to completely blow through it and do over a million.

After my Christmas stock out, my sales have been shit. I haven’t even checked Amazon in about 2 weeks, but I think I’m doing about 5 thousand a month on Amazon. But I’ve been spending my time working on my systems and building the infrastructure and advertising funnels that are going to take me well over 100 thousand dollars per month consistently as soon as I flip the switch.

All I need right now is access to capital. I have the confirmation and I have the confidence and I have the support structure around me to grow fast without the wheels falling off. I just have a couple more small pieces to fit into puzzle and I’m golden. Most importantly, I know exactly what to do to fit those pieces in.

So that’s the big picture.

Now I’ll try my best to provide a linear recap of this week and how I’ve arrived at that big picture. I’m sitting in an open tent in sunny 70 degree weather in Vegas right now smoking a cigar and writing. Hopefully I get into a flow because I feel like I can just sit and write for 10 hours straight right now.

Decompressing From The Week

I don’t come to conferences for the content anymore. I’ve heard it all before and I have more than enough skills and business acumen to succeed. I come to conferences for the networking and to develop relationships that help me level up.

Because of my network and my relationships, I was able to get into a small mastermind led by Ezra Firestone the day before the ASM event started. Ezra is one of the top ecommerce strategists in the US and probably the world if you get down to it. He owns multiple brands and has consulted for some monster fortune 100 companies on their ecommerce strategies. Facebook actually called him up a few months ago because they were making so much money using Facebook advertising. Facebook literally wanted to know what the hell they were doing to make so much money on their ad platform so they could incorporate his feedback and build a relationship with him and his team.

So the day before the event, I spent 8 hours in a small room with Ezra and about 20 other very high net worth people learning from him. Learning everything he’s doing and how he is designing his funnels. How he scales business process and the services he uses to coordinate everything into a money making machine. I got to ask him questions and get on a first name basis with Ezra and all of these other amazing people that are doing amazing things in life and business. Again, the content was just content. It was good, but what I really got out of it was confirmation again that I AM a fucking rock star and that I am doing everything right. I can’t stress enough how important that is to me.

Ezra Firestone Mastermind

I sat next to Ken (bald guy behind my hat)  for the entire time at the mastermind. Ken owns multiple real estate businesses and is developing some condominiums right now. He also owns a couple supplement brands that he’s in the process of scaling up. Next to Ken was Freddie. Freddie is an older guy that’s been around the Internet Marketing space pretty much since inception. Freddie is partners with Jerry West, who is arguably one of the best SEO guys in the world and the only person I will listen to for SEO advice. I was actually going through one of Jerry’s courses on the plane ride to Vegas.

I also got to meet Alan (far left of picture). Alan is a Scottish guy with a ridiculous accent that I can barely understand half the time. He lives in Panama, has real estate businesses and a brand in the home and garden niche. He’s in the process to scaling up over a million this year as well. He also knows and is involved with Simon Black’s sovereign man confidential. Think I had an in with Alan when I told him I was one of the 50 entrepreneurs from around the world that Simon selected to come out to Lithuania for a week last summer? Alan also knows the owners of Red Frog beach in Panama, which coincidentally is exactly where Justin has his condo in Panama. I’m going to introduce the two of them this week.

I also met Iyathos (half head next to Ken) from Colorado. He’s doing about 250 thousand dollars per month with his physical product brand. Another guy I met in the mastermind was this Indian dude Mikial (next to Alan). He has a speech impediment and as bad as it is to say, I let that influence my perception of him and I didn’t really go out of my way to meet him at first. When I did meet him, I found out that he used to be a trader and was a multi multi millionaire and had Maseratis and houses all over the world. Then he lost it all in 2008. Now hes building up his empire again. Cool and Funny ass dude. We had some really fun times drinking together.

So I met all these people and hung out with them all day. Most of them are doing more than I am right now in business, but guess what. I was able to hang with all of these guys intellectually for the whole weekend and I actually taught them a lot of stuff. They were coming to me with questions and I had all the answers and strategies that they wanted to learn.

Now that I knew all of these guys, I had my own crew to hang out with through the entire event. Remember a few months ago when I promoted the ASM course and did over 130 thousand dollars in sales for ASM? Well, that got me a VIP pass to the live event. VIP means that my badge had a little ribbon on it that signified status. That little white ribbon made everybody treat me differently this whole week. I don’t get caught up in that status bullshit normally, but it is amazing how that changes perceptions.

When you have a conference of about 4,000 people and you are one of the few VIPs, you are a big deal. The only other way to get a VIP pass to the event was to pay an extra $10,000 just so you could hang out with and network with the other VIPs. Just to get good seats, people were showing up and waiting in line at the Venetian at 6:30 in the morning and the doors didn’t open until 8:45. I hung out later at night drinking and partying with all the other VIPs and then would roll out of bed at 8am and walk over to the conference center. 4,000 people had been waiting in line all morning and I just walked right by everyone and took the elevator up to our private VIP room. Sat down, had a banana and a coffee and shot the shit with all of the speakers and other VIPs. Then we’d walk in to the conference and take a seat in the second row from the stage. That’s what I mean when I talk about status and networking and the ability to get on a first name basis with all of these high net worth people. (No, I’m not on a first name basis with Kiyosaki or Branson. Just pictures)

Robert Kiyosaki Sir Richard Branson VIP Badge

 

One morning I was sitting there having a casual conversation with Robert Kyosaki’s wife. Then I’m sitting there talking with Jason and Matt about the future of their business and getting inside info on what’s going on. I don’t know the exact numbers for their business, but I think they are around the 100 Million dollar mark now after launching ASM 1 about 2 years ago. They just rebranded and purchased the domain amazing.com for $780,000 and their goal is to become the number 1 place where aspiring entrepreneurs go to learn how to build and scale businesses.

Matt’s only 28 years old by the way. When he was 25 (my age) he had built 2 million dollar ecommerce businesses already, but he was in about 180 thousand dollars of debt and had no way of paying it back because his businesses weren’t profitable. Now look at him and what he has helped create in just the last 2 years. Matt is definitely a robot though when it comes to interpersonal communication. I think when you are so business oriented and you have to think and make decisions at such a high level every day, you can become devoid or detached from emotion. I find myself getting that way sometimes when I get super consumed with my business.

Last night was great though because we were all out at the bar and Matt had a few drinks into him. He loosened up and Matt, Alan, and I talked for probably about an hour and a half. It was funny because for the previous couple days Alan kept telling me he heard Matt was part of the brotherhood. By brotherhood, I mean the skull and bones Ivy League school type of thing. The secret society that the movers and shakers of the world are all a part of. Movies and the media have kind of sensationalized the whole skull and bones secret society thing, but it’s real and we talked about it over some beers.

Alan literally just called him out straight up on it. In the middle of our conversation Alan was like, I see you are here with so and so, what’s it like to be a part of the brotherhood? This is top secret kind of stuff and I have no clue how Alan was able to track some of the members down and know who they were. For a second Matt just looked at us with a bit of shock and then just started talking about what it was like to be a member. What he said made a lot of sense.

If you’re a local business owner, there’s a network group for you. Once you get into 6 figures, there’s another networking group you get into to associate with those like minded people at the same level as you. Same thing when you start doing a million a year. As you keep going up though it gets harder and harder to find and associate with the people that are on your same level.  That’s pretty much what it is. It is the premier society of the people that make the world move.

After talking to Matt, Jason comes over with Shane and says hey what’s up Mike how’s it going? I’m literally on a first name basis with these guys. I don’t know if I’ve mentioned it on my blog before, but Shane is actually Jason’s brother. I was in a mastermind with Shane for the past year and we did calls every Friday afternoon to share strategies with each other. We also partnered up on the ASM launch so I’m very close with Shane and now I’m connected with Jason. Shane is in a similar level up position right now because Jason brought him into his business and is funding Shane on a bunch of projects. A couple months ago, Shane was doing about 100K per month. Now his goal for this year is to do 1 Million per month by the end of the year. All of the sudden, Shane now has 8 brands in different niches and he’s taking his business international. He just started selling in Europe and he’s working on tapping into India and South America as well. Unfortunately we are not masterminding together anymore because he is in the next level of people now, but I consider him a true friend and he’s someone I can call whenever I want.

At the bar, Mikial also introduced me to the guys from VOX. In the US there are pretty much 5 companies that manufacture every type of supplement and consumable. All of the major brands all come from the same places and they keep all of the formulas secret for everyone. VOX is a very big deal. To put their business into context, earlier last year a ton of people rode the Garcinia Cambogia wave. Overnight, tons of people were doing in some cases 300 grand per day selling just Garcinia. VOX was the first of the supplement manufacturers to develop Garcinia 80% which at the time was the highest level out there of the active ingredient. So when you look at their business, they were selling to all the people that were doing 300K per day. I can’t even imagine how ridiculously wealthy they got feeding the wave.

After hanging with those guys for a little bit, I’m sitting at the bar talking to this guy Gabe who partnered with Anik Singal on the ASM Launch and they took 2^nd place. I don’t know his specific cut of the money, but in total they did about 2 million bucks I think on the launch so he made a nice chunk. We’re sitting there talking and right behind him is Yanik Silver. In terms of movers and shakers in the world, Yanik is on the same level as Matt and Jason, Ryan Deiss, Perry Belcher, and Simon Black. Check out Yanik’s bio, it’s pretty ridiculous http://yaniksilver.com/who-is-this-yanik-silver-guy/

So I go to Gabe, watch this, and I make a joke and made fun of Yanik. I’ve never met him before, but it was a funny ass joke and he came over and we started talking with him. We all did our introductions and when he got to me he mentioned he thought we had already met before. Want to know why he thinks he already met me before?

Yanik runs a group called the Mavericks http://maverick1000.com/#!/ . They only accept a certain number of people in the group and you have to be a millionaire to get in. They coordinate exotic adventures all over the world and all the millionaires just go and do shit like climbing mountains or sky diving and then hang out and network together. It’s a couple grand per month to be a Maverick and it’s simply for the opportunity to do cool shit with other super successful people. Shane is joining the Mavericks now by the way.

Yanik also runs a similar camp to Simon Blacks for young entrepreneurs. I think he calls it MaverickX. I knew this going into our conversation and I also know my friend Jock Purtle that I met in Lithuania also went to the Maverick X camp last year. So I mentioned to Yanik and I asked him if he knew Jock. Of course he did, and then I dropped that yea I know Jock from Lithuania because I went to Simon’s camp.

Yanik and Simon as far as I know are the only 2 people around that do these young super successful entrepreneur camps so I knew they were friends. I’m also pretty sure Simon is a Maverick as well. So anyways, we talked about that stuff for a while and now I’m on Yanik’s radar. The reason I think he thought we already met is because Simon just released his video for this year’s camp in Lithuania. Guess who has a 20 second speaking role on that Video? Yours truly! Yanik had to of watched Simon’s launch video and already saw me before we met at the bar. All of my networks are starting to intersect and IT’S FUCKLING AWESOME!

Side note: How cool is it that I have known Shane and Jarod for the past year strictly through the internet and skype. Never met either of them in person until this week, yet we did the 130K plus launch together and have helped each other grow our businesses exponentially over the past year. I feel like most people couldn’t comprehend having internet relationships like that, but that’s what’s so cool about the technology we have available today. I did the same thing with Justin. Never met him in person until we knew each other and worked together for over a year.

Me – Shane – Jarod

As for Aruba, it cost me 15 grand to go with those guys and mastermind for the 3 days. Before Lithuania if I was faced with that decision I would have said I couldn’t afford it. Guess what? I still can’t afford it, but I did it. I did it because I know the relationships from that trip will sky rocket my business even further than where I am now. I need to come up with another 10 grand by the end of this month so my credit card doesn’t get declined. It’s a scary position to be in and it’s risky, but Fuck It. I’ll come up with the money and I’m willing to go into some debt to get it. If I didn’t have all of the confirmation about what I’m doing in my business, then I would have had to miss out on the opportunity. But I do have that confirmation and I know I’m going to ramp up very very quickly as soon as I flip the switch when I get back.

I’ve built my business to be a multimillion dollar business even though our revenue isn’t there yet. So the way I look at it is that if I truly believe I’m going to do a million this year, then I’ll profit somewhere in the 300K range. That 15K is a drop in the bucket. Again, it’s not about the content, it’s about the relationships. I was very nervous when I committed to Aruba because I could easily put that 15K into inventory and advertising to grow my business. But that would be a short term view on things and that would be chasing money. Instead, I’m investing in my long term because I know it will work out for me.

Over the weekend I did a core values exercise with an executive coach. One of the things I learned about myself when I did my introspection was really my view points on money and risk. I’m where I am at today because I’m not attached to money and I’m willing to take significant calculated risks in order to get high pay offs in the long term. From working with Justin unpaid for a year to learn about entrepreneurship, to walking away from Ben’s equity offer in Canada, I’ve been making decisions not based on money, but based on gaining experience and working on myself and my skill sets.

I haven’t discussed it yet, but I’m going to be doing a TV infomercial for Cave Tools. That’s going to cost me 7 grand minimum and there is a high chance it could flop. If it doesn’t do well in the test market, then I essential paid 7 grand for a sales video. If it does well in the test market, then I crush my million dollar goal because I have the funnels already built to capitalize on the halo affect of that campaign. I’ll say it again, I don’t have the money in pocket right now for this stuff. But I’m thinking bigger and I’m putting myself in situations where I can make it work. I’ll get the money for it and I’ll turn it into a profit.

If the infomercial is a flop, then I got experience in that market and dealing with tv producers, etc. That’s worth it to me. To go to my original point, I’m not afraid to lose money and I’m willing to put myself out there and I think that’s really one of my core values that I want to stay true to.

With Shane out of the picture, Jarod and I have decided to continue moving forward with ASM Elite. ASM 5 is launching in April, so we are planning on doing another very large launch and this time splitting it 2 ways instead of 3.

I’m just thinking of it now, but we definitely need to have the conversation regarding ownership and funding of software tool development. That whole thing fell through with the 3 of us, but I think Jarod and I might pick that back up where we left off.

The first night of the event we hosted a dinner party for our members in ASM Elite. We went to a really nice Italian restaurant called Buddy Vs. Shane was there the night before and spent $900 just on himself between drinks and food. We weren’t planning on picking up the tab, but everyone kind of expected it so we decided to just split it 3 ways for a party of about 20 of us. The damage wasn’t as bad as I expected, but we figured if we could get at least 1 new signup in April out of it then it pays for itself.

Dinner was great because we got to meet all of the people under us. We are all pretty much their mentors now and they come to Jarod and myself with business questions all of the time. Some of these people are way more wealthy and experienced than I am in business, but I’m in the position of mentor because I know ecommerce inside and out now.

We actually have about 10 people from this weekend that bought the ASM course for $3,500 but didn’t come in under a group like ours. Just to have the ability to get mentored by Jarod and I, they are willing to pay us $1,500 a pop to join our group and have access to us. All of our members also have friends and family that they want to be able to join and get in when ASM 5 launches in April.

For each new signup, Jarod and I get to split a $1,500 commission. As soon as we get back, we are having our developer build in a sub affiliate link software to our membership site. So now we can make all 40 of our current members sub affiliates for us. That means when they promote our group to their friends and family, they will get a couple hundred dollar kick back.

It sounds like an MLM type of thing, which I would never ever do, but the reason it works is because we are actually and truly making our members rich as hell. These guys are going from regular jobs to making 10-20k per month in a few months based on the education provided in ASM and the mentorship we provide. They want to tell everyone they know about the course because it truly is life changing for them and we are in the perfect position to capitalize on the opportunity and make everyone else rich in the process. It’s awesome.

A couple of our members actually approached us this weekend and said they feel bad because they are taking up our time with questions and they want to pay us for our time. So now Jarod and I are going to roll out a monthly consulting retainer to our group so they can get a certain amount of access to us per month. It will probably be about $50 a month or something depending on how we structure it, but when you get 40+ people paying you that kind of money it becomes some serious passive income. Income we can use to develop more software and to build our own businesses.

We all met in a bad ass suite in the Venetian last night for beers and we were very open with them about it. It didn’t feel like we were selling to them at all because it’s what they want. We’re going to release a survey to the whole group so they can be brutally honest about what we’ve done right and what we’ve done wrong so far. That way we can continue to develop our membership and release information and software that they need to succeed.

We’re also looking forward because ASM 5 is the last time they will release the course in the US. After that they are going to be releasing a course on how to break into Europe. Jarod and I need to now set up business entities and get our businesses up and running internationally so when the time comes for the next launch we are still ahead of the game and can provide the value they need. I can barely keep up on inventory now in the US, but that just means I need to get more capital and use it to fund inventory for an international subsidiary.

Cave Tools in my opinion doesn’t even lend itself to a European market because bbq is such an American dominated lifestyle. In Europe they live in cities or in rural areas. They drink beer in the pubs versus Americans that have yards and like to drink beers outside and grill. If I’m going to do this successfully, I’m probably going to have to start a new brand all together and start researching and getting into the minds of my European customers.

All of this sounds great on paper, but the problem outside of capital is really bandwidth. I don’t have the time to do all of this stuff. That was one of the big questions I spoke to Ezra a lot about. All he does in his business is create ideas and then he has smart team members that do all of the work. I need to become that visionary in my company instead of the operations guy.

One of his biggest pieces of advice was about hiring smart help before you have the work for them because it forces you to utilize their help to the maximum so you get your money worth. I’m going through this with Dorothy now. She’s may be working 30 ish hours per week right now, and that is forcing me to delegate more and more work to her so I can get the value from her time.

Filipinos are great, but at the end of the day they are task based. I need a “Mind” to work with me on my team. Someone I can say hey we’re doing this project, now get it done. I know I’m not going to get the value out of this person and I may go red for the first couple months, but that is going to force me to delegate more and after the first couple months the business will be doing way better because I’m not stuck in the weeds anymore.

I was thinking about all of this before I came to Vegas and I’ve already got my first real hire figured out. Remember my unpaid internships at Penn State? The type of person that is willing to do an unpaid internship is exactly who I need. I don’t need a technical person, I need someone who is hungry like I was when I worked for Justin. Somebody that understands the tradeoff of building experience and deferring money in the beginning so you can focus on building your skills and experience. That person is Ryan and I’ve already talked to him regarding a possible job. I was on the fence about it before this week, but now I know I need to hire him no matter what.

The good thing about Ryan too is that he’s just coming out of college in May. I can hire him for cheap, somewhere in the 25-30K range per year and I will completely change his path in life. By living at home and working for me for a year, he will learn more about business than he ever imagined. The best part is that he knows it and he shares those values.

Can I afford him right now? No. But I can’t let that influence my decision. I need to think like a multi million dollar company and I need to act like one because it’s coming. If I can plug him in as a manager so Dorothy and Caecilia can report to him then I am golden because that frees me up to work on business growth for the majority of my time. If I can train him to make operating procedures on his own and teach him how to work with VAs then my business grows exponentially. I don’t give a shit about hard skills. I care about mindset and he has it and that’s why he’s going to succeed in my company.

This is going to be the most wild ride of my life. I have the entire map and the entire vision and the skills to make all of this work.

It’s getting late and I’ve been at this for quite a few hours writing. The last little story I’ll include on this post is pretty interesting.

Matt and Jason ran an Aruba mastermind back in October. I went out to the bar with a bunch of the people that went to it so I could pick their brains. I had talked to most of them with the exception of this one guy John. He had been kind of eyeing me up and giving me looks all night. He finally comes over and starts asking me about my business and we’re talking for a while. It’s mostly me sharing about myself so when I turn the conversation around to start to get to know him a little better, I ask his name.

He tells me his name is John and I introduce myself as Mike and he says yea I know. I actually know everything about you and your business already. I’m the owner of Grill Beast and we are direct competitors.

Now I’m like shit, I just told this guy so much stuff. But it turned out to be awesome. He had been trying to figure out how to approach me the whole time because in this situation most people would probably be very stand off ish because of the competition. But we were both cool with it and he told me how much he loved my brand and that they spoke about my company a lot in Aruba and he was kind of using me as a model. This guy came out of nowhere and started crushing me on my thermometer listing. I told him how I saw him fly up and it forced me to raise my game to compete with him.

We started then talking about our suppliers and cost of goods sold and all sorts of stuff. At the end of the day I don’t care if he knows about me and he doesn’t care if I know about him because processes are what drive business. We’re both not trying to dick each other over and the healthy competition forces us to raise our game.

It was really cool to actually get insight into his business. Especially after he literally knew everything about me and had been trying to reverse engineer all my shit for the past couple months haha

 

4th Quarter Madness – Michael O’Donnell

I just outlined the topics for this blog post and holy shit a lot has happened since my last post on November 2. Last year I didn’t get to fully experience what a Q4 was for ecommerce because I only had a grill brush and our grill set had just recently launched and had no traction whatsoever. The last month and a half has been absolutely crazy for the Cave Tools business and just for life in general.

The craziness is what I love about being an Entrepreneur though. Whenever you ask somebody “What’s New?” you normally get the standard response of “Same old, same old.” The fact is, when you have a regular job, you pretty much repeat the same things every day and nothing ever changes. I on the other hand don’t know where to start half the time because once I get talking, I could go on for hours. This blog post only covers the last month and a half, but it might be my longest blog post ever.

Books I’m Reading

Before getting into the meat of things, I want to talk about the books I have been reading. I really feel like the books I’m currently reading have a major impact on my thought processes and how that manifests into results for my business.

Recently, I finished the book Cashvertising by Drew Eric Whitman. This book was recommended to me by my good friend Clayton Bradshaw and his description was that the book was his “Bible” when it comes to advertising. I can honestly say this was one of the best marketing books I ever read. It reminded me a lot of Influence by Robert Cialdini, but thinner, more current, and much more direct.

This book has done wonders for me when it comes to writing ad copy and positioning my products and brand. Drew is from the Philadelphia area as well which is pretty cool because he references things in the book that I can relate to. He also used a local ad agency as one of his examples. I had the opportunity to meet the owner of this company last year when we brought him in to speak to the MDM group.

I knew right away that he was legit and I spent a ton of time talking to him and asking about his influencers. He was a big Glazer Kennedy (GKIC) guy back in the day and I could tell when I read through all of his materials. To see this guy used as an example in “The Bible” on advertising about a year later was really awesome.

Currently, I’m about 75% of the way through “Introducing NLP,” a book that was recommended to me by hypnotist and master internet marketing mentor from Sovereign Man in Lithuania, Cliff Mee. I rarely quit on a book once I get started on it. I like to power through even if it’s not a book I am enjoying. The first 30 or so pages of this book were very dry when they were discussing the Neuro side of Neuro Linguistic Programming. However, I powered through that part and the rest of the book has been fantastic. I’m loving the linguistics side of thing and how they break down true meanings behind words and how people say them.

I have no intentions of putting in the time and effort to become an NLP master right now, but the book has been incredibly insightful. From a psychology standpoint, it’s been a wonderful book.

The next book up on my list is Spin Selling by Neil Rackham. I learned a ton from J Massey in Lithuania and his system for sales was very impressive. This book apparently provides the core foundation on how he structures all of his sales calls so I’m really looking forward to it.

After Spin Selling, I have “The Moral Case For Fossil Fuels” written by Alex Epstein. He was a speaker I helped bring in from the Ayn Rand center back was I was up at Penn State. We really hit it off and I’ve done a below average job of keeping in touch with him since. We exchange emails maybe once per year. Anyways, he has been doing an excellent job building the Center for Industrial Progress and is really starting to make a name for himself so I’m looking forward to reading his book. I also have “Confessions of an Economic Hitman” and “Fluent Forever: How to Learn Any Language and Never Forget It” coming up in my queue. Very excited for both of these books as well.

Cave Tools Featured on The View?

Shortly after I posted my 3 month follow-up blog post on November 2, I received an email from an Advertising Agency that works with Television stations. Normally when I receive these types of emails they are spammed out, but they were claiming to be able to get me on some big name TV shows so I responded to see what was up. Before she could disclose any information to me, I had to sign an NDA.

I did a little research on the company and they looked legit. The NDA wasn’t crazy, just pretty much saying I can’t disclose who they were because they were a behind the scenes agency and they don’t want random people contacting them. They prefer to reach out to brands that they have already researched. I returned the signed NDA and then a couple days later we jumped on a phone call.

She didn’t really give me too much information at all. It was more of an on the spot interview about my company, our brand values, what separates us, how much inventory we hold in stock, etc. For not really knowing what to expect on the phone call, I thought I did a really good job. She loved the meat claws in particular, but because they only sell for around $12-13 she said she would want to bundle the claws with the digital thermometer and market them on TV shows geared towards women and moms.

Before she could discuss any further with me, I had to sign more documents. They sent me a blank IRS W9 form that I had to fill out and a 9 page contract with crazy regulations in it. I read through the entire contract a few times and wrote down all of my notes. I also sent the contract to my dad and asked him to do the same. Later that night we compared our notes so we could be absolutely certain of every term in the contract. Basically the contract amounted to if anything got messed up in any way, they would take my first born child haha

Some of the terms in the contract included:

• They determine the price they sell my products for on the TV show (Basically would be doing a flash sale similar to QVC but on different networks).
• They won’t pay me until after they have all my inventory and the flash sale is over
• They can return products with no penalty or charges at my expense
• I can’t display any logos or anything showing that Cave Tools appeared on certain TV shows (Basically they own all IP related to the promotion)
• If there are any delays in shipping, I get charged 3% of the total purchase per day late (this was huge considering I needed to front everything and not get paid until the end). In addition, I would get charged a $10 per unit fee that was not delivered on time. When you’re talking 4,000 products, I consider that taking my first born child and destroying my company
• I needed to up my business liability insurance from $1 million to $2 million dollars. This sounds like a lot, but it would only have cost me about another $200 to up the insurance.
• When we shipped them the products there were lots of specifications as to what needed to be shown on the outside of each carton. Missing 1 single element would result in multiple other penalties. FBA warehouses would not be able to do this for me, so I would need to place a certain amount of inventory in a storage facility and have them custom prepare my products for shipment to the Warehouses of this Ad Agency.

After reading through all the regulations and with the understanding they would be purchasing 2,000 units of thermometers and 2,000 units of meat claws, we decided we would do it. My only concern was that I wasn’t going to have enough inventory on the back end to support all of the extra promotion and sales.

I returned the signed documents and was asked to provide my Best Price that I would sell to them for. With wholesale, I normally sell at around a 30% ish profit margin. However, with all of the additional risk associated with this contract, I discussed with my dad and we decided to give them pricing that would secure me a 50% profit margin on the sale.

I was worried that my pricing would be too high for them because their model really is to do a flash sale at deeply discounted prices. It also said multiple times throughout the contract that this is not something we should be expecting to make a lot of money on and that it was more of a chance to get mass exposure for the brand. I gave them the pricing anyways and figured that if they rejected we could always negotiate and see where things went from there.

She got back to me and said that my pricing was a little high, but they could still feature me on The View! The only problem I saw with it was that I literally had about 10 business days to get all of the inventory prepared and shipped to their warehouses.

At the time (and still currently) the longshoreman union in Los Angeles was kicking up a lot of shit because they knew it was the holiday season and they had leverage. Even though the average salary is somewhere in the 150-200K range per man, they wanted more money and were randomly stopping work and congesting up the ports to cause a big stink. I had a shipment of Meat Claws that waited at the port for over 12 days before they even unloaded the carton. I also had a shipment of thermometers on the way which should have been in on time, but as of the time I’m writing this now Dec 14, it still has not been unloaded at the port. The ports were also adding an extra $1,000 fee on top of all containers to account for the congestion.

This extra fee by the way was illegal, but they were trying to force it through anyways the bastards! Eventually the lawyers settled the extra fee dispute and they weren’t able to charge the extra fee on containers that had already been waiting at the port. I did however have to spend an extra $450 out of budget as a proportional fee on my thermometers container.

In the end, I had to back away from the opportunity. I asked if we could follow up and do the promotion in February for a Valentine’s Day style promotion, but have not yet heard back. I’ll follow up again with her in January so I have plenty of time to prepare this time around.

I still think the opportunity will be available and I’m happy I didn’t chase the money/exposure because I never would have been able to handle it. We’ll talk about that later on in the post.

Boston Coaching Gig Falls Apart

In November I talked about an opportunity I had to become an ecommerce coach with a wholesale company based up in Boston. At the point, I knew that something had to give because I was going to be taking on more work than I could handle. The payment they were offering me was only $40 per phone call, but the upside was that I’d have the opportunity to do 3 events before the end of the year and make about $2,000 per event.

Shortly after hiring me, Chris went on his honeymoon and was out of the picture. While he was gone, his brother Alex was running the operations of the company. My $40 per half hour phone call really turned out to be per 1 hour phone call. They also had absolutely no structure and I was pretty much learning on the fly.  The students they brought into the program were all very suspicious of the company as well and thought the whole thing was a scam. It wasn’t a scam, but they were just growing too quickly to keep everything running smoothly.

I started out doing the coaching calls and was also putting in a lot of extra effort problem solving and doing non coaching call types of things. Then when it came time to do the first event, I spoke to Adam about my flight and he told me they were trying to cut costs so they wouldn’t be bringing me to the event. I explained how that was a condition of my hire, but he really didn’t give a shit and said Chris wasn’t here so he was making the decision.

Alex also got me on an hour phone call and was trying to get me to show him my entire business model and advertising funnels so he could copy it and create a course on my business model that he could sell to his students. He wanted me to pretty much do all of this for free and was pissed off when I told him I wasn’t going to just turn over my entire business for $40 per hour in coaching calls.

The writing was on the wall for me, so after about 1.5 weeks I told him I wasn’t going to work with them anymore. It’s taken me until yesterday to actually get paid for the coaching calls I did. I’m still getting emails from their students now who they took over $10,000 in fees from and haven’t delivered on any of their promises. When I spoke to Justin about it he agreed with me that it was ridiculous and said he thinks they are the kind of guys that bill first and worry about delivering later. Definitely not stand up guys or the type of people I would have any interest in working for.

I guess I’ll chalk this one up to a learning experience. My biggest motivation for doing the coaching was so I could learn the wholesaling business model. I didn’t even get that out of it. I downloaded all of their material before I quit and when I went through it, it was all pretty much bullshit. Their whole company is really built just on a fantastic sales pitch, but there is no substance behind it when it comes time to teaching what they preach. I feel horrible for all of the suckers they get to sign up for their programs.

Developing Marketing Automation Tools and Partnership

Not a ton to report on the development of our Ecommerce Marketing automation tools. We have all been very busy, but Jarod has been managing our Indian programmer and we have so far completed  2 of the tools. A couple more are on the way still and the website itself is starting to look pretty nice.

I created our product listing blueprint and the product launch guide based on all of the strategies Shane, Jarod, and myself use on a regular basis. They came out really nice and we have added those guides and all of our webinar recordings to the website for our students.

We started talking the other day about how January is the time when we will need to finally turn this thing into a legal business structure and give it a name. Right now everything is on a handshake basis so we definitely need to protect ourselves. There’s also a little bit of tension going on between Shane and Jarod because Jarod and myself have been doing more of the work, Jarod especially. I’m hoping it all blows over because even though Shane isn’t a major asset when it comes to marketing and operations side of things, he has all of the personal connections and relationships we need to get our product into the hands of mass customers with little effort.

I think a lot of the tension also has to do with the fact that Shane and I are making a killing over the Christmas holiday with our Amazon businesses and Jarod’s is lagging behind. In the end, I think it just has to do with the seasonality of our products, but anytime you see your partners making 4 times as much as you, there is going to be the fear of missing out.

Shane’s brother Jason, the founder of ASM, is also in the market to purchase tools from people. Lately it seems like all of the successful people in ASM are creating their own tools. It’s a race to the finish line for who can create the best tools and take them to market the fastest because there is the opportunity of a buy out on the table. It would be really cool if we could get this entire business set up and then cash out only 3 months later. That is actually very likely right now!

Black Friday, Cyber Monday, Christmas Explosion – Tis the Season for Cave Tools

It seems like every time I get some success and start to get ahead of the game I get a bunch of shit dropped on my lap. I think it was the great Sir Isaac Newton who said for every force there is an equal and opposite force. This time around the negative force wasn’t anywhere near equal to the amount of success we had, but we definitely have a lot of shit to deal with as a result of our holiday success. For now though, let’s focus on the positives.

This year I wanted to do things big for the holidays. In September and October I did a lot of research and built a list of big time product review and mommy bloggers that I wanted to review my products. Some of these websites get around 30,000 views a month on regular months of the year and way more during the holidays.

Out of my list of about 50, only about 20 got back to me and said they would do reviews for me. I shipped out free products to every one of them and also requested to be listed in their Holiday Shopping Guides that they put out for their readers every year. One of the ladies got back to me and said she landed a big time advertising spot for free for her blog and wasn’t going to charge me at all. She loved my Meat Claws so she featured the post at the top of her blog. Throughout the entire holidays, her blog was featured as a banner wrap on double decker buses throughout San Diego and Los Angeles and I was the first thing people saw when they went to her website!

From an inventory standpoint, I started preparing back in August and I pretty much doubled all of my inventory for each product. When I ran my projections, I was expecting probably about a 50-80% boost in sales so doubling up would have left me with plenty of extra after the holidays were over. The worst thing I could possibly do was stock out during the biggest shopping month of the year!

Looking back, I probably should have 7 X’d my inventory because sales went absolutely crazy for Black Friday and Cyber Monday and I didn’t even discount my products. After those two days I started scrambling to get more inventory on planes as soon as possible because I knew I was going to stock out at Christmas.

At around the same time, the Port Unions started kicking up a lot of stink in Oakland because they wanted to be paid more. Those guys all make around 180K per year plus benefits, but they knew everybody was trying to get shipments in for the holidays so they had leverage.

They all pretty much just stopped working and allowed the ports to get extremely backlogged. One of my Meat Claw shipments sat on the boat for 2 weeks before they even took the container off and processed the inventory. After they finally processed my boxes, they needed to be shipped to my warehouse in California and then shipped out again to go on to Amazon warehouses, so this delay was major.

The Ports then (illegally) tried to impose a congestion fee of $1,000 on every container because of the backlog. Lawyers got involved and ultimately they weren’t able to charge me for my meat claws because they had already been sitting there waiting before the fee was announced. My thermometer shipment however did get knocked and I ended up paying an extra $450 because of the damn unions.

The thermometer shipment left China in October and as of today (12/21) they still haven’t reached my warehouse in California. That shipment in itself has been an absolute nightmare. Normally I ship the thermometers by air. You need extra documentation and testing that costs about $5,000 per shipment for the batteries to be approved for air shipping. What I do is allow my manufacturer to coordinate the shipment because they send them to Hong Kong first and then to the US and get around this ridiculous fee. What I didn’t know was that I can ship them via ocean with no problem and use my own guys. So my manufacturer coordinated the ocean shipment and about 2 days before they left port I realized they only did the shipment, not delivery to my warehouse or customs clearance or anything else.

Basically the thermometers were just going to be dropped off in Oakland and nobody would know what to do with them. I started scrambling to get the back end shipping figured out and my manufacturer said to simplify things they would just let me use their freight forwarder. So now I’m dealing with a Chinese freight forwarder (Dolphin Logistics) and signing power of attorney and other documents for a company I know nothing about. Dolphin was making me incredibly nervous because they were so unorganized and they kept asking me dumb questions like is my warehouse on a military base? They were probably just checking off boxes on the forms and making sure, but come on!

Instead of paying the Chinese freight forwarder, my manufacturer paid them directly and then refunded me the excess money I sent them (about $1,200). The freight forwarder won’t give me an invoice for this shipment because obviously the manufacturer took their own spread on the deal, but I’m just happy they were able to figure it out for me.

So all of this shit is going on and at the same time the holidays are here and people are buying like crazy. At one point, I was selling over 100 Meat Claws per day! (UPDATE: 12/29/14 reviewing sales reports. Before stocking out I had 3 days in a row of 300+ Meat Claw sales) To offset the demand I was increasing my prices like crazy. My grill set normally sells for around $29 and at one point I had it up over $40 and they were still flying off the shelves. I literally stocked out of everything except my grill brushes and now I won’t be back in stock for at least a couple more weeks.

Sales were skyrocketing overnight. I went from my best ever of around $1,500 in one day to stringing along multiple 6-$7,000 days in a row!

 

Up until this point I have been completely self funded so there is no way I would have been able to prepare for the holidays the way I actually needed to. Next year I’ll have a line of credit from the bank so I should be in really good shape.  I think I could have probably done a good quarter million dollars in a month if I was fully stocked up. And that’s with only 4 product lines! Next year I’m going to be super aggressive with my bank funding so I’m hoping to have at least 8-10 by that point. For the record…I also received my ASM Affiliate check this month and had Hyacinth Marketing revenue of a couple grand. Can you say first 6 figure month? Boom Baby!

Of course, with every two step forwards I take, I take one big step backwards. We had a customer service nightmare on our hands I ended up over selling the Meat Claws by over 1,000 orders before we realized what was happening and could shut down the listing. We had to cancel all of the orders on Dec 18 and then inform everyone they weren’t getting their products by Christmas time and they weren’t getting them until Jan or Feb now either.

This whole issue was actually Amazon’s fault and they accepted responsibility for it. But at the end of the day, we took the brunt of the hit and people were justifiably extremely pissed off. I had to sit and write a letter to send to everyone explaining the situation. In the span of about 3 days, Caecilia and I probably fielded over 4,000 emails. Just day and night doing email all day long. It was brutal, but the letter helped soften the blow and I don’t think we are going to get a ton of negative press and feedback online as a result. Amazon is set up so you can’t bulk email customers, but Caecilia found an intricate work around to do it so we were at least able to bulk email the letters. She gets paid hourly, so I gave her a bonus of 10 hours worth of money because of the amount of time she saved us!

Sometimes shit just happens that’s out of your control. Here is what I wrote:

Dear Customer,

I’m writing this letter to express how deeply sorry I am that you will not be receiving your Meat Claws order.

Over the past two weeks, both Caecilia and I have been reaching out to provide updates on the delayed shipping situation. We gave you our word that no matter what, we would get your order to you before Christmas.

Today is now December 18^th and unfortunately we are spending our day cancelling/refunding orders instead of shipping them out. This is not a situation we are taking lightly. We pride ourselves on going above and beyond with our customer service and always providing fast shipping for our customers. Today we let you down.

For some of you, this letter will seem unnecessary. For many of you, this letter won’t be enough.

I understand that many of you are angry and if I was in your situation I would be to. I’m not writing this letter to point the finger at Amazon or attempt to justify the actions that were taken. There are always 2 sides to every story.

At Cave Tools, we believe in full transparency. For those of you interested in an explanation, I have laid out all of the facts on page 2 of this letter.

They say that somewhere between 20 and 80 percent of customers will do business with a company once and never again. We sincerely hope that you will give us another chance to earn your business in the future.

Next time you shop for Cave Tools on Amazon, use coupon code QQZJQ3VZ at checkout for a 30% off discount. This coupon code will apply to our Grill Brush, BBQ Tools Set, Meat Claws, Digital Thermometer, and our Meat Tenderizing Hammer (available in February).

Caecilia and I will be working around the clock to make sure we answer any and all questions you may have. You can direct your inquiries to orders@mycavetools.com  and we will do our best to answer as soon as possible.

For the next week, I have redirected our customer service phone line to go directly to my cell phone. If you call (267) 282-1009 you can speak with me personally.

 

Sincerely,

Michael “Medium Rare” O’Donnell

Cave Tools – Owner

How Fulfillment by Amazon Works: Cave Tools (the seller) sends inventory to Amazon warehouses. The warehouses receive the inventory and typically within 48 hours that inventory is available for shipping out to customers. When an order is placed on Amazon, a message is automatically sent to the warehouse and order is shipped to the customer immediately.

Timeline:

• November 24: We stocked out of Meat Claws
• November 26: New Meat Claw inventory shipped to Amazon Warehouse. We set the restock date on Amazon to December 8^th and started accepting pre-orders with the understanding that all orders would be shipped no later than the 8^th
• December 1: Meat Claws received at Amazon warehouse and expected to be processed within 48 hours. Even with holiday delays, we have plenty of time because we set our ship date to December 8
• December 3: We receive notification from Amazon that 100 units have been lost. We shipped the Meat Claws in boxes of 40 each, which means they would have had to lose 2.5 boxes. Investigation ensues. There is still plenty of inventory to satisfy our commitments even if they can’t recover the lost units.
• December 6 – 8: Inventory still showing in “Receiving” status. Phone calls to support every day notifying them of December 8 shipping commitments. We are told that our inventory is being expedited and that it will appear by “The end of the day today”.
• December 9 – 12: Phone calls every day explaining that we are now late on our orders. Amazon assures us they are accepting responsibility and explains that for some unknown reason their computer system decided to ship all of the inventory to another warehouse across the country.
• December 13: Amazon support notifies us that our inventory is now expected to be available on December 17 and we will be able to make delivery in time for Christmas
• December 14-16: Phone calls to support checking on status. No new information
• December 17: Inventory still showing as 0 units. Support launches another investigation. At 7:30pm we are notified that our new inventory, which was supposed to be reserved for customers like yourself, was actually sold and that is why inventory is showing as 0. Amazon accepts responsibility for the error and support does not know why we were previously told that our inventory would be available by December 17.

 

The news we received yesterday came as a complete shock. How could we possibly have sold the inventory without knowing about it? Why were we continually told that our inventory would be available to ship to customers before Christmas?

 

 

 

There are many unanswered questions right now and we are still reviewing all of the information with Amazon to see how we can get to the bottom of this. More importantly, how we can avoid something like this happening again to us and other Amazon Sellers in the future.

While I don’t want to speculate about why we were told certain things about expected delivery dates, I can offer my best explanation as to how I think the inventory was sold without our knowledge.

When inventory is received and processed at Amazon warehouses, we are normally notified that the entire shipment is now available for shipping. For example, if we sent 100 units, after they were processed, 100 units would show as available inventory on our dashboard.

According to my conversations with Amazon Support, this didn’t happen. Instead, small spurts of Meat Claws became available at a time. Using the above example of 100 units, this means that throughout the day 10 units would become available, then 5, then 7, etc.

Before our Seller’s dashboard could update the inventory numbers, those incremental units were being sold already. As far as we knew, Amazon support had been telling us that it would all be received on December 17 and our inventory stayed at 0 on the dashboard.

The next logical question would be how did we not notice the additional sales revenue coming in since these units were in fact being sold? Even though the inventory stayed at 0, our Seller’s dashboard would still be reporting the additional income.

Amazon shows us total sales on a day to day basis. However, this sales number is a top level number that includes all of our product lines together. The specific data, such as how many Meat Claw sales were sold on a given day typically lags behind a good 2-3 days.

Since the Meat Claw sales were coming in incrementally and both us and every Amazon support person we spoke with was under the impression that our inventory was still being transferred from one warehouse to another, we were unable to determine what happened until yesterday.

To Amazon’s credit, their support staff spent a good 3 hours yesterday sorting through all of the information before they could come to this conclusion and let us know what happened.

 

As mentioned previously, we are not trying to point fingers or justify the events that happened. We truly believe that at every step of the way both Cave Tools and Amazon took actions and communicated with customers using the best knowledge that was available at the time.

We are sincerely sorry that you did not receive your order and we hope that the above explanation provides some clarity as to why.

We are continuing to review all of these events in detail to see how we can learn and grow as a company. You are a valued customer and we will do our best to earn back your trust.

Trouble in Wire City

At the same time all of this was going on, I was having some serious wire transfer issues.

Chinese New Year is coming up soon and the entire country pretty much shuts down for a full month. Nobody works or does anything. The problem with this is that if you want to stock up for summer time, you need to place your orders before the holiday and hopefully ship out as soon as they get back to work so you can be ready in time.

After what happened to me last summer with my grill brush stock out, I wanted to load up like crazy. For my first time ever, I’m actually filling an entire ocean container with Cave Tools products. It will be a split between 3,000 grill sets and 3,500 grill brushes. So I spoke with Tracy and just like normal I sent my 30% deposit so we could start manufacturing. About 15 hours later Tracy Skype’s me and she’s upset.

She forgot to tell me that they changed their banking information since my last wire and they couldn’t receive the money I sent them, about $5,000 worth. Not only that, but the company name changed, the bank changed, and the account numbers all changed. Can you imagine the look on my banker’s face when I went down to work out the recall?

I’m not sure how true this is, but this is my understanding of the way it works over in China. Non Chinese people are not allowed to own manufacturing facilities. So they get a Chinese guy to own the place and then a bunch of foreign corporations own various percentages of his company. Throughout the year, they change the banking and business names around so they effectively distribute their income to the various accounts of the actually businesses that own the manufacturing facilities. This is obviously very shady and probably not legal from a tax standpoint in China, but that’s on them. I’m just a paying customer 🙂

The recall took about 7 business days and somewhere along the line intermediary banks took about $150 out in fees. I got my money back and then re-wired the full 100% to Tracy and everything worked out. They even started manufacturing before they received the money so I wouldn’t get hit with any delays. It was an honest mistake and Tracy helps me out so much throughout the year anyways so I wasn’t angry with her. I let her save face and we moved on.

While this wire was under investigation, I had another wire I sent for an order of Meat Claws that my manufacturer claimed they never received. The money had left my account already and we double checked that all the banking info was correct. What the fuck!

So now we started a 2^nd wire investigation to see what happened and determine if the Chinese bank was trying to screw me. Meanwhile, my manufacturer was storing my products in their warehouse and wouldn’t release for shipping until the balance was paid. They ended up storing my products for almost a month before they finally said I needed to pay and get rid of them because they didn’t have room to store them. Now I had to float another $4,000ish so we could move forward with shipping before I received my original money back.

The Chinese bank kept telling my manufacturer and me that we needed to produce what’s called the swift 103 bank copy. I drove down to my bank 2 days in a row asking for the documentation, but the banker I was working with had no clue what it was. She called the wire department a few times, but wasn’t asking the right questions and I was getting pissed off and arguing with her. Basically as soon as she heard the first no she just told me nobody knew what the swift 103 was. Even though this is a universal bank form for wires.

I was being really short with her so finally she just gave me the phone number to the wire department and said call yourself because nobody knows what you are talking about. I was on the phone with them for less than 7 minutes and I was able to get to a manager that knew what they were talking about and they sent the 103 swift to the Chinese bank.

After the investigation was complete, they said the reason the bank didn’t accept the money was because on the beneficiary company’s name we left out the Co, LTD. at the end. What a fucking joke! Of course the intermediaries took out some fees again along the way, but in the end I got most of my money back and the Claws are on the way now.

New Website Finally Launches

About 5 months ago I purchased cavetools.com so I could eventually move away from mycavetools.com. When it comes to web development, I have worked almost exclusively with WordPress throughout my career. WordPress is great, but the platform itself is meant for informational websites, not ecommerce.

I had a pretty damn good ecommerce set up on WordPress, but it was buggy and often times I was getting calls from customers because they couldn’t place orders. I get around 3,000 visitors per month to my website, but at the end of the day it just wasn’t converting into the sales numbers I would expect. I was literally only doing a couple orders per month using that website even with all of that organic traffic.

For my new website, I wanted to use an ecommerce platform that would convert my visitors into buying customers. I did my research and chose Shopify as the platform I was going to go with. I then went through a bunch of ecommerce training materials and started analyzing big ecommerce websites like Amazon and Zappos to see what kind of marketing features I wanted to pull in to my website so I could maximize conversions.

I then took my whiteboard and drew up the website design and wrote up a word document explaining all of the features on the site.

I then contacted my shopify development programmer in India, Nalini. We discussed all of the features and the intricacies of the design. From a coding standpoint it wasn’t going to be easy to do what I wanted to do. I understood that, but I also wasn’t happy with the development time and final price she gave me.

So I started contacting Shopify development agencies in the U.S. to get a comparable rate and see what they could do. In the end, I found an agency up in New York that’s run by 2 brothers that used to be big time ecommerce guys back in the day before starting their agency. It was only going to cost me about $500 more than using Nalini and I would be able to call them and speak with them since they were in New York. Part of me was also interested in how they handled the entire web dev process since I do a lot of that stuff in my marketing agency.

I got a quote from them and also documented all of our conversations so I could use similar processes on future websites we build in Hyacinth Marketing. He also gave me a 2 week turnaround time which was great.

In the end, the website turned out fantastic and I couldn’t be happier with it. In the last 7 days we’ve already done over $1,000 in sales and I have inquiries for 4 rotisserie grills. They were the toughest thing to sell on my old site and now people want to buy them all the time from me. Here’s a screen shot of the new site:

The day after we launched the site (Dec 9) I had an awesome idea. I wanted to see if my graphics guy Ibrahim could photoshop in my tongs on a kickass banner image I found. So I brought out my product light box and took like 30 pictures of the tongs at all sorts of angles and sent it over to him. It only took him about an hour’s worth of work, but he did a fantastic job. Far exceeded my expectations on what the result was going to be. I gave him a 3 hour bonus payment on top because I was so happy.

The new website has all sorts of really cool features such has product zoom when people hover over an image (same as Amazon) and 2-step opt in processes all over the place for lead gen. Instead of normal email capturing like you see for our VIP member’s area In the footer, I have buttons all over the place to give away the free recipe book. When people click on the button, they think they are getting it for free so they mentally commit to it. After they click the button a pop up appears and asks them for their email.

Since they already mentally committed to it, they are way more likely to give their email address. The system I’m using also pre populates their email address in the field if they’ve been cookied on other websites before that also use this system. The result is that they mentally commit and then their email is already typed in so they only have to accept and they get it. Really awesome technology!

I also created semi-automated funnels for retailers who want to carry our products and bloggers that want to do reviews. In the past we did everything on a person by person basis, but now I’m able to build email lists of each type of person. In the future I’ll be able to contact them all at once and provide consistent messaging. I can see us running liquidation deals and things like that for wholesalers when we want to move a lot of inventory at once.

I already received a call from Cigars International because they want to carry our products on their website. Normally wholesalers order like 5-10 units at a time, but they want to purchase an initial order of 500 meat claws. Only problem is I don’t have any left in stock after Christmas, so we’ll follow up in January with them.

On all of our packaging we advertise free recipe book with the purchase. When you offer it for free with the purchase, people get pissed if you then ask them for their email address because technically it’s not free now. So what we do is we insert a business card into every package telling them where on the website they can go to download the book and people don’t have to give their email address.

This insert strategy is great because I can sell products anywhere, including in retail stores, and people still have to come back to our website. On that bonus page, I wanted to devise a special offer that I could give people so I could capture their information. The problem with Amazon is I don’t get people’s email addresses so I can’t build my own customer list. The list is a major asset for the company so I created what’s called a self liquidating offer.

A self liquidating offer is simply an offer that you break even on, but still acquire a customer. I wanted to find something valuable I could give away for extremely cheap that would help me acquire customers and be enticing enough for people to buy.

The two big things people in my industry are always looking for are internal meat temperatures and wood smoking flavors/temps. So I found a guide for each online and told Ibrahim to recreate them exactly but with my branding on it. Then I just went in and changed the suggestions and wording around so we weren’t stealing anything and nobody was going to try and sue for copyright infringement.

I then had both guides turned into magnets. The internal meat temperature guide is for the refrigerator and the meat smoking guide is an outdoor magnet for the grill. The beauty of this all is I’m acquiring customers for break even AND I’m getting branding in their households. Every time they have a party or people over, they see Cave Tools front and center. Brilliant!

I actually thought up this strategy randomly about 6 months ago as I was driving into Philly for a lacrosse game. I was so excited and knew I was going to forget it so I made an audio recording on my phone and just talked for 30 minutes straight about all the details so I had it down. I also spoke with Justin about it and he helped me finalize my strategy. I think originally I was going to give the magnets away for free, but he mentioned that would kill me from a cash flow standpoint and that I’d much rather break even instead of taking a loss.

Just like everything else I do in my business, the magnets had to be scalable. I wasn’t going to be manually shipping all of these things out to each customer. That would take forever! I did a little bit of searching and found a local mailing fulfillment center that could print and ship all of the magnets for me. To keep the costs down on the offer, we only ship them once at the end of the month and use USPS.

I just got all of this together and finalized 2 days ago. Just in time for everyone to open their Christmas presents and go download their recipe books. I also shot a video of me personally thanking every customer for their purchase and put that on the bonus page and also ask for people to leave a review right there on the spot.

This is perfect because we are getting them right when they are the happiest and just opened their product. We are giving them a free recipe book and some other really valuable and cool offers. They can’t possibly be unhappy because we have given them what I like to call a Customer Experience.

Corporate Structuring and Taxes

We’re coming up on the end of the year. While it’s great that we made a huge chunk of cash here at the end of the year, I need to watch out for the tax man. Since I started Hyacinth Marketing in 2012, I’ve been using my Dad’s accountant Bobby Trauffer for all of my stuff. Bob is good, but at the end of the day I have no relationship with him and he has messed up a couple times on me before.

Over the past 2 years I have been a part of a local business group in Doylestown and had the opportunity to meet and become very close with an awesome accountant. So starting January 1, I’m going to be moving everything over to Doug. I’m also hoping he can help me out with tax planning next year because this year I am screwed.

I decided to reinvest almost all of the money into new inventory and product lines. If I could do this much money with 4 product lines, imagine how much I could do when I add more. So In the past month I’ve spent probably about $60,000 ish between inventory, fulfillment, new product samples, paying off my loan to my dad, etc. Then I come to find out that when you reinvest money in inventory, it doesn’t count as an expense on the books. What that means is that even though I no longer have that money and I did the right thing and invested in my company, it will all be taxed as a profit to the business.

I haven’t gone through everything to prepare for taxes yet, but I’m not looking forward to it. I have a feeling Uncle Sam is going to put me through the ringer.

Currently Hyacinth Marketing is an LLC and is the only business I have. Cave Tools is just a brand name that Hyacinth Marketing owns. Eventually down the road I’d like to sell Cave Tools so I need to have separate books and corporate structures for each company.

I met with my attorney Ron last week and starting January 1, we are going to do a downstream merger and asset purchase. Basically that’s a legal way of saying I’m starting another company and it’s going to buy all the Cave Tools stuff off Hyacinth for free.

We’re also going to change Hyacinth Marketing into an S-Corp so I can pay as little as possible in taxes. The new company is also going to be an S-Corp as well. The way I understand it is that as the owner of an S-Corp I have to pay myself a “Reasonable” salary. Reasonable is not defined by the IRS, but if we made 100K I would probably have to pay myself 50 or something like that to pass through without any flags. That first 50 would be taxable, but then I could do a shareholder distribution for the other 50K and that wouldn’t be taxed. I like the sound of that 🙂

The new company is going to need a name and I don’t want to call it Cave Tools. The reason for that is because people can do an importer record lookup and figure out exactly where I source my products if the name was Cave Tools. Nobody is ever going to know the name of the company because Cave Tools will be the DBA name, so I’ve decided to have fun with it. We’re going to call the new company Medium Rare Industries!

One of the other really cool things with having 2 companies now is that I can bill Cave Tools from Hyacinth Marketing. Basically throughout the year I can allocate expenses to certain books and that way I can keep them both under certain tax brackets.

We’re also going to be adding a 3^rd company in there for the partnership with Shane and Jarod, so Doug is definitely going to have his hands full with me for accounting.

Hiring a Full Time Marketing Employee

Remember Karen? The full time marketing girl I hired and was really excited about? Well she strung me along for about a month with excuse after excuse and I finally had to fire her. I tried giving her the benefit of the doubt so many times, but at the end of the day she really set me back.

So now we have Dorothy on board and she is doing awesome so far! She costs more money, but she also has way more experience and she can think for herself on a lot of things which is good. She’s a single mother of two and I have her working my hours, which is her night shift. Hopefully once she is fully trained we can work out a better arrangement for her so she can work regular hours and still have enough communication with me.

Right now I have her trained on Blogging, Press Release writing and Social Media. This week we will be adding in Video Marketing and then some other specific marketing strategies. My plan is to just keep teaching her stuff until I can fill a full 40 work week for her of just straight marketing. After that, I’ll hire another person and cross train them. With all the different strategies I have in my head from over the years, I think I could easily have 2 people working 40 hours a week just on marketing Cave Tools.

The thing I love the most about having Dorothy on board is that it is forcing me to create operating procedures for every aspect of the business. I read and learn so many strategies every year that I never have a chance to implement. When I train Dorothy, I create a detailed word document explaining all of the instructions. Then I shoot a video of me following the instructions to a T and demonstrating the strategy.

I probably have about 20 operating procedures right now. My goal is to build out operating procedures for everything in marketing and then start doing operating procedures for operational tasks as well. This is exactly what I did for Caecilia too. She has a 15 page Customer Service Representative manual with instructions and videos on how to do everything she ever needs to do.

When I’m done, I’ll pretty much just have like a monster book on how to run my company. I’ve talked before about my online resource training center I set up called Hyacinth Connect. Each employee gets their own area they have access to and then inside the area is all of their training materials. Instead of just giving them pdf operating procedures, I added in a wiki so everything is editable.

Whenever the wiki is edited I actually get an email about the updates. So at this point I know for a fact they haven’t been using it the way I want them to. But my goal is to start to train them to update operating procedures and add new operating procedures on their own when they discover new ways of doing things. I’ll work more on this aspect once Dorothy is fully trained and can manage her own work week. Since I get email notifications when the wiki is updated, I plan to start giving small bonuses to incentivize the behavior.

Considering Credit Cards

Up until now, I always just used my bank credit card for the business. However, my dad suggested I start getting airline credit cards and rewards cards. I spend a lot of money every year for business expenses, so I might as well start getting free flights from it all!

Looking into the various cards now, but hoping to rack up some serious points in 2015

Mentoring Matt Greenwood

I met my friend Matt Greenwood while I was in Lithuania. At the time he was developing an app and running a nightlife company in Madrid. The company was still pretty young, but it seemed like they were on the right track.

We were speaking the other day on Skype and Matt told me about how his company went under and he moved back home and had to get a job. Shitty situation, but something almost every entrepreneur has to face. I’ve been speaking with Matt pretty regularly now and helping to mentor and coach him along.

He has a job now, but he’s working on a couple different ventures on the side. I’m teaching him a good bit about outsourcing and really just being there for advice when he needs it. It feels great to be able to give back to people in the Lithuania group.

Meeting up with Tim Murdoch

Tim Murdoch (Head Coach for Montreal Lacrosse Team) was in town the other day and I got to meet up with him and grab a couple beers. His son Max had a lacrosse tournament in Feasterville, which is only about 20 minutes away from me. Unfortunately 2 teams canceled last minute, so the tournament was over after only a couple games. A lot of the parents were pissed off because they traveled from 9 different states to get there and their kids only played 2 games.

We dropped Max off at the hotel and went out for a two hours to catch up on life, business, and lacrosse. I don’t know how much I’ve talked about Tim on here in the past, but he’s a beast when it comes to business. He makes a very good living doing consulting for large companies. He only has about 5 clients and tries to work a maximum of a couple hours per day. The rest of his time he uses to coach lacrosse and enjoy life.

It was about a year ago he told me how he knew the founder of this new company and the guy was giving him an equity stake in it. The company pretty much hired Oxford Linguistics experts and developed an algorithm that aggregates public tweets and based on public sentiment they can very accurately predict what will happen with certain stock prices.

Tim went to Princeton and Harvard and sits on the US and Canada businesses board, so he knows everybody. I pretty much just look at him like The Great Connector. He was telling me how in after only a year already, the company is growing like mad. They expect it to be worth around 600 Million in about 2-3 years. Pretty much everybody in the financial sector is trying to license their software from them. They launched  with Bloomberg as their big whale and now they are almost at the point where they could fully stand on their own without Bloomberg just because everybody wants in now.

This was about 2 weeks ago so my raw facts might be a little off, but out of say 14 of the big wall street investors in the company, Tim has introduced the founder to 6 or 7 of them.

It’s always great speaking with Tim because he gives some outside advice on how I’m doing in my company. Somewhere down the line I can totally see him recommending a big client or important person to me. Definitely one of my best personal relationships that I try to keep warm and check in with every couple of months.

Webinars with Ricky

Last week my friend Ricky from Lithuania reached out to me with an idea. It had been a little while since we last talked, but he wanted to run a partnership idea by me and also catch up on life. We haven’t had a chance to speak yet in detail, but here is a synopsis of what’s going on.

I kind of forget Ricky’s entire background, but I’m pretty sure he worked at Goldman for a while and then quit to start his internet business. He’s a year or two older than me and has lived all over the place. He also hates digital footprints so he has almost no public presence on the internet. In 2015 he finally wants to come out of the shadows and stop being a behind the scenes guy.

Ricky is big on info products and webinars. Between his businesses they did about 2 Million last year in webinar sales. He’s also a workaholic similar to myself but on a different level. If you take everything at face value, it seems like he works about 12 hours a day 7 days a week all year round. I don’t think necessarily because he has to, but he wants to. Just like me, but on a more extreme level, he really enjoys everything he is learning and is passionate about his business.

So anyways, Ricky is a great guy and he was also the one who started our monthly Blacksmith webinar training series where we all teach each other different strategies we know. He tried launching an Amazon business last year in the adult niche (Aka Dildo Store haha) and completely failed and had to liquidate his inventory.

His idea is to partner with me on a webinar series that will teach people more about the physical products business model. He has all the webinar systems in place so he’s thinking that if I put in some up front work with him, he can probably do a good 5 figures with it and I would get a new passive income stream out of it.

If this was anyone else contacting me for this opportunity I probably wouldn’t do it. Ricky is such a smart guy though and in exchange for my knowledge he’ll pretty much teach me the entire ins and outs of the webinar business. Like I said, we haven’t had our full catch up conversation yet, but this could be a really good opportunity moving forward into next year.

I’m also thinking of eventually turning my outsource work into an online course. If this works well, Ricky would be my go to partner to help me launch it. When I’m done, I’ll pretty much have a turnkey content marketing outsourcing course that people can just hand off to outsourcers and blow up their businesses.

Objectives for new year

We’re already at 25 pages of content, so I’ll wrap this up quickly. Some of the work goals I’m setting for next year include:

• Adding in digital cooking courses that I can upsell to all of my physical products customers. These would be almost 100% margin and my product sales already prequalify everyone so it’s the perfect money making storm. I have Chef Carmen lined up for some conversations in January. I’m not sure if I really need to bring him in on this though or if his credibility would be worth it. In the end, he has the expertise, but I’d be writing the course content anyways. He would just be the guy to cook it all up.
• This is an entire blog post in itself, but Estonia just released a business E-Residency program where people from anywhere in the world can easily set up an Estonian corporation and take advantage of the tax breaks and be outside the reach of the US Government and US Dollar. I’m just going to say that for now this is on my radar and could be a real possibility a few years down the road
• 2015 will be the year of email marketing for me. My people received probably 4 or 5 emails all year last year. That’s horrible! With my new expertise in funnels, I plan to start developing really intricate relationship building sequences and use email to generate a lot of additional revenue
• Money Goals? I have no clue what I want to make in money. I just want to keep driving on because I love what I do and what I’m learning. The 4^th quarter this year was fantastic. With the different businesses I have going on and the addition of a bank line of credit this year, I think there is a real chance that I can do $1 million next year. For all I know I can either far undershoot this goal or crush it. Regardless, it’s all about the ride

Over the past 3 years, I’ve gone to quite a few seminars and marketing conferences. I always learn a lot of new techniques, pick up 1 or 2 new key relationships, and come home energized and ready to grow my business. However, this increased drive and energy typically fades after a couple weeks and I return to my “normal” working habits. Granted, my new normal is at a higher level than it was before, but the energy boost and increased drive is what fades away.

This time around was different. I didn’t come away from the Blacksmith camp with a checklist of marketing techniques I wanted to implement. Instead, I came away with some major mindset changes that have allowed me to get out of my own way and really take my business and life to the next level.  I also came away with about 40 new key relationships and a firm support group of other entrepreneurs my age all striving to better their lives on a daily basis. I can’t hold myself accountable to my friends at home. They are in a totally different place in life and have completely different goals than I do.

With the Blacksmith Alumni facebook group, I now have a group of people that I can hold myself accountable to that will help me raise the bar for success and keep my focus on the things that are important in my life. I really want to go back to Lithuania next year. For that to happen, I need to take action and prove to you that I’m worth your investment. I’ve been incredibly busy since returning home and wanted to take this opportunity to share with you everything I have been working on.

Lifestyle Changes and Liberty

One of the first lifestyle changes I made was to commit to reading a minimum of 10 pages per day before I sit down at my computer and start working. I downloaded an app called Habits and placed it on the home screen of my phone so I can see and track my commitments every day. Some of my other habits include working out every morning, getting out of bed by 6am at the latest, and doing daily meditation. The app is great because I see a big red circle on my phone every time I don’t complete a habit I committed to. As J Massey would say, If I want to be a person of integrity, then that starts with living up to my own expectations. If I say I’m going to do something, then I’m going to do it.

When I compared myself to the other Blacksmith members, I would say I was above average in entrepreneurial education, but I had a lot to learn on the liberty side of things. Before the camp, I really didn’t know much about Simon or have a firm understanding of the current international economic situation in the world. When I returned home, I immediately became a member of sovereign man confidential and I started reading The Creature from Jekyll island.

I literally read through all 600+ pages of Jekyll Island in under 2 weeks. I couldn’t put the book down. It completely opened my eyes to everything going on in the United States and the federal reserve and changed my outlook on the world. Between reading Jekyll Island and SMC, I’m continuing to read and expand my knowledge about what’s going on in the world.

Out of all of the mentors, I connected the most with J Massey and became very interested in Real Estate. I read Cash Flow Diaries and subscribed to his podcasts so I could learn more about real estate and make use of my time while driving in the car. I also took a real estate investor I know out to lunch to pick his brain about getting into wholesaling. Then I joined a bunch of local Cashflow 101 meetups and started attending local real estate events so I could build my network and learn from more people.

Overcoming Limiting Beliefs About Money

For me, playing Cashflow with J helped me overcome some self limiting beliefs I held about money. Before the camp, I had been growing my physical products business solely on profits. Whenever anyone asked, I was proud that I never took any investment to grow my business. After hanging out with J, I learned that that was the complete wrong way to look at things and that if I had my systems in place that I should be accepting to money so I could accelerate my growth.

I started sitting down for meetings with my local banks to see what type of financing they could provide for me. I also sat down with my friend Alan who is a mortgage broker. He has connections to tons of investors, so we started working on deals to see how much money I could raise. Just sitting down to have these conversations with everyone was incredibly enlightening for me and I learned a ton.

I found out that the banks wouldn’t give me a business line of credit until I could show a tax return with a minimum of 150K in revenue. My business was on pace to do over 150K in revenue this year already, but last year I only did around 60K so I would have to wait until my tax returns in January if I wanted to go that route.

The investors that Alan introduced me to all wanted equity in my company. For the amount of money I needed, I wasn’t comfortable giving away equity and the interest rates they wanted to charge on short term loans were through the roof. I considered all of my options and ended up taking a loan for $15,000 from my dad. I already owed him about $5,000 so I figured I would put the money into inventory and hopefully be able to pay him back after the holiday season. Once January came along, I could get up to a 150K line of credit from my bank and use it to pay off my debt to my dad. That way I would be solely responsible for all of the money owed.

I used the money from my dad to fund inventory purchases for my current products and also planned to launch a new product before Christmas. With my levels of sales, I should have had enough money set aside for inventory, but I mismanaged my cash on hand. I was tracking everything up to this point on excel spreadsheets and never had a true financial picture of where my company was at any given point.

Mismanaging my cash flow was a big mistake that I couldn’t let happen again. So I met with my accountant and over the next couple weeks I went through the painful process of importing 1,000s of transactions into quickbooks online. Now I have a clear financial picture of what’s going on in my business and can run financial statements and appropriately reserve money for future expenses.

After funding inventory, I wanted to use my excess cash to develop new products that I could launch before the holidays. Timing was tight because it typically takes about 70 days from the start of manufacturing for me to get my products in the warehouses and ready for sale. I ran into a bunch of snags with manufacturers and ended up abandoning the idea of having new products by the holiday season. Having new products would have generated more money, but I didn’t want to rush things and launch a product that didn’t meet my quality standards. Instead, I devoted my efforts towards something I hoped would make me even more money in the short term.

Amazing Selling Machine Launch

In October, the Amazing Selling Machine course reopened for sale to the public. This was the course I went through that helped me learn how to source and manufacture products. I partnered up with Shane and Jarod from my Amazon mastermind group to sell the course as affiliates. I’ve been around the internet marketing industry for years, but affiliate marketing was new to me so I was excited to see what we could do.

The course cost about $3,500 so with each sale we would get a $1,750 commission and split it 3 ways after expenses. None of us had an email list to market to, so we decided that we needed to create an awesome bonus package if we were going to get people to sign up under our group. We started out by researching the bonus packages of all of the top affiliates from last year’s launch and we did our best to match or provide a better bonus where we could.

We tried everything when it came to driving traffic for people to buy the course through our link. We each placed about $1,000 into an account and then used it to pay for facebook ads, twitter ads, craigslist postings throughout the country, a news paper classified ad, and even some plenty of fish (dating website) ads targeted at entrepreneurial type of people. Nothing was working and we were spending a lot of money and time to make this work. By the 2^nd video of the launch, it looked like we were only going to make a few sales and barely make our money back. Let alone still having to provide all of the bonuses we offered.

Then, one night as I was working it came to me. Why were we spending so much money trying to drive cold traffic when the other bigger affiliates were just going to poach our sales anyways? What if we flipped everything upside down and only focused our advertising on people that we knew were already interested in the course. Under each sales video in the launch there was a facebook comments feed. Each video literally had 1,000s of comments from people who had watch the videos and engaged with them.

I called a meeting with Shane and Jarod and told them we needed to stop all of our advertising immediately and only focus on the people who engaged via the fb comments. I did a little bit of research and about 5 hours of work later I built a scraper that dropped the profile urls of every commenter into a spreadsheet. We now had a list of about 2,000 unique people we could market to.

If you send a private message to someone on facebook you aren’t friends with, it goes to their “other inbox” and they never see it. However, if you pay about $1, facebook will drop the message in their regular inbox and they are pretty much guaranteed to see it. We now had a $1 cost per acquisition for targeted traffic.

Jarod had a background in creating bots with a software program called uBot. The next day, he created a program that automated the entire process of private messaging everyone on our list and accepting the $1 charge. We split the list into 3 and we each ran the program on the background of our computers and messaged every single person. This automation program saved us probably about 20+ hours of work!

Instead of telling them to go to our website and “check out our bonuses” we decided to send them a message telling them we created a skype channel where they could ask us questions about the course that weren’t answered in the videos. Everyone had questions and our message wasn’t trying to sell them, so we had excellent response rates. Now once we had them on skype we would friend request them and engage in conversations. On the final days before the cart closed, we were able to follow up with phone calls to every non buyer and convert them over to our group.

We went from a potential total failure to ranking #14 on the top affiliates board and selling over $125,000 worth of the course in 7 days! After expenses, we all cleared about $20,000 in profit and will be paid after the 30 day refund period expires at the end of November.

For me, this is a completely life changing amount of money. I’m 25 and still living at home, so all I wanted to do with the money was just pay myself and finally move out again. But that would literally be the worst way to spend the money. Not only would the government take a huge portion in taxes, but I would be ruining my opportunity to put that money towards other cash producing assets such as new inventory and new products.

New Business Opportunities

I’ve discussed it with my dad and when I get paid, I am going to pay myself about $3,000 to keep myself going and make a payment of approx $5,000 towards my loan from him. The rest of the money will be spent towards new products (possibly launching a new brand) and towards a new business I am forming with Shane and Jarod.

There are approximately 5,000 students who are in or have gone through the Amazing Selling Machine course. All of these people and other Amazon sellers need marketing tools to help them promote their products. Our goal is to reverse engineer all of the software out there and start making our own versions and selling monthly memberships to people. We each left money in the shared account and already have a full time programmer working on our new software suite.

Once it is finished we will be giving all of our members who joined under our affiliate group lifetime access. We will then use their word of mouth and also tap into the ASM facebook group and other Amazon groups to get an initial base of users. We will not only be making money off of our new software suite, but we will also build a giant list that we can market to for the next ASM launch!

Becoming an Amazon Coach

Right around the time we were wrapping up the affiliate launch, my mentor Justin Lee gave me a call. I worked for Justin as an unpaid intern for a full year while in college so I could get firsthand experience from an entrepreneur. Justin has played a major role in my success and helping me become the entrepreneur that I am today. After spending some time catching up, Justin told me that he ran into an old real estate buddy who started an Amazon wholesaling business about 5 years ago. They were growing faster than they could keep up with and were looking for some coaches to help them out with their growing student base and he wanted to know if I was interested.

I spoke with his friend Chris Bowser and he ended up flying me up to Boston last week to meet his team. Chris essentially owns 3 businesses in one. They run facebook and radio advertisements in cities throughout North America and drive people to free events where they learn about wholesaling on Amazon. From the events, they sell people on a coaching program and 3 day boot camp to get them up and running. Once the people are trained, they can purchase products directly from Chris’s wholesaling business which uses bulk buying to pass deals on to their students. It’s a very cool business model and I’m excited to learn the wholesaling side after being on the private label side of selling for the past year and a half.

Starting this week, I’m taking on 5 new coaching students and I’m expected to increase that number over the next couple months. They are also going to be flying me out to some of their events. With everything I have going on right now, it’s probably not worth my time to be doing the coaching for the amount of money they are paying me, but I’m very interested to learn this new business model and I think the relationships I build with Chris and his team will be very beneficial for me in the future.

Marketing and Outsourcing

At the same time as all of this is going on, I still have my Marketing agency providing SEO, PPC, and reputation management services. I decided that I would just keep my current clients and stopping trying to get new ones because I would rather focus my time on all of these other amazing opportunities. However, I keep getting phone calls and new referrals coming in from all over the place. This past week I on-boarded 2 new clients and have 1 more on the way. It’s funny how you can go through droughts in business and then all of the sudden everything tends to hit all at once.

Right now I’m working 7 days a week just trying to stay on top of everything, but I’m absolutely loving it. I’m learning a ton and I’m challenging myself every day to work smarter and more efficiently. I’m also building a bigger and better team around myself to handle all of this new business.

Starting Monday morning, my first full time outsourcer will be coming on board. In the past I’ve always done hourly or fixed projects with my outsourcers. Now I’m at the point though where I have the cash flow and work to support someone full time. I’ve created a full online training resource center for Karen with written and video instructions for everything she is going to be doing. In the beginning, I will have her doing blogging, video marketing, press releases, and social media management for Cave Tools. Once she gets comfortable with that, I will start training her on how to take over some client work for my marketing company.

Last Thursday I held my first training webinar for the Blacksmith alumni and went into detail about my entire outsourcing system and management practices. It felt awesome to be able to give back to the group and share my knowledge with them.

Fool me once…shame on you. Fool me twice…shame on me.

A couple weeks ago I got a call from Wayne. With the exception of a few random conversations, we really hadn’t spoken a ton since we stopped working together.

The fact that he made me chase him around for over a month and kept dodging/avoiding paying me were definitely contributing factors. It’s not like he was paying me a salary or anything either, these were expenses I paid for on my credit card that he said he would reimburse me for. I knew at the time he was in a tough position from a cashflow standpoint, so I figured his actions were a product of circumstance, not personality.

We talked for about 15-20 minutes just catching up on the phone and he seemed like he was back on his feet again. His education company had picked up and he had just returned from Seattle locking down a new school contract. The reason he was calling me was because he was working on putting together a parenting workbook for inner city families in L.A.

Apparently, schools in Los Angelos are required by law to spend 5% of their discretionary budget on parents every year. They normally spend this money on parent teacher nights and food, but 5% usually comes out to about $50,000 per year! Through his conversations with various principles from those schools, they told him that they literally struggle to spend that money every year. If he could come up with a decent parenting workbook, they would give him the contract.

So Wayne went around and pitched a bunch of principles on his parenting workbook idea and in his words, sold the thing before he even made it. He lead his pitch with his absolute best activity for parents and children, tied it in to a personal story, and sold them on the entire workbook based on what would become just 1 page of the entire thing. He’s a hell of a salesman, I’ll give him that.

His pitch/story had to do with a quick activity that helped parents learn a ton about their child. First, you ask the kid to write their name in the middle of a piece of paper. Then, they need to place the names of their friends around their name. The closer the friends name is to their name, the better friends they are. Farther away means they aren’t as close friends. They also have to group friends in clusters based on who they hang out with.

Right away, the parent can get an idea of who the major influencers are on their child and who hangs out with whom. After this is complete, the child has to write 2 things next to each persons name about why they like that person and 1 thing about what they don’t necessarily like about the person. Now, the parent gets to see what their kids are attracted to and what turns them off. This is very powerful information that most parents never know and it only takes about 5-10 minutes to complete.

So Wayne has all these contracts waiting on him now to produce a workbook with about 60 pages worth of these types of activities. The reason he was contacting me was “Because he needed someone he could trust to do a full day of white boarding with him.”  In reality he only had about 10 of these activities pre thought out and he needed me to help him build the rest and take notes as we brainstormed. He offered to pay me $25 bucks an hour if I would help him out.

I had a ton of stuff on my plate with Cave Tools and Hyacinth Marketing and also had 3 interns coming on board within the week that I needed to prepare for. I figured that this would be a good way to rekindle a relationship with an old business partner and also get my creative juices flowing. He seemed to be back on his feet, so I ignored the thought of him screwing around with me like last time.

I assumed that helping him out as a friend meant that this was a personal job, not a business job. Like when you help a friend move out of their apartment and they hand you 40 bucks at the end as a thank you. In retrospect, I definitely should have discussed payment terms with Wayne first, especially knowing the type of person he was.

Wayne’s neighbor had free office space for us to use in New Hope, so we took over for the full day (9 hours). I have to say, outlining and creating a book was a pretty cool experience. We discussed layout, organization, illustrations, and reverse engineered a bunch of competitor books.

We decided to break the book up into the cover, credits and copyright page, introduction page, parent child contract, and then 4 activities per section (Self Awareness, Family, Friends, Education, Health, Money). The back had a corresponding student section for activities that both the parent and child would do and then compare answers.

All of the competitor books pretty much covered these areas, but they just had words on paper. There was very little interaction and the messages were very direct. The goal for this book would be to have less words and more activities. As the parents and children completed the activities, the answers/message would come through indirectly and would be learned because they actually engaged with the book instead of skimmed through it.

It was a good concept, but to be honest I would never do any of the things we put into the book. I mean these were some pretty basic parenting skills that I guess as a white boy from the suburbs I just take for granted that everyone already knows and understands. However, our target audience comes from a completely different background and household. We approached the book with the mindset that if someone did the entire book, as long as they came out with just one good insight, it would be a success. With that perspective in mind, the creative flow of ideas came much easier.

We worked on the book all day with a short lunch break in between. Over lunch, Wayne started talking as usual. Telling me about how he got a 10K commission for introducing his friend to the owner of the restaurant across the street because his friend bought it. Then he starts going on about how his wife has a new job and that he’s also been selling coffee on the side to distributors for extra cash. Now that he was a big coffee connoisseur he had all of these grand plans for launching his own private label coffee brand. He was going to sponsor farmers in South America and had a brilliant plan to use kids to sell the coffee in train stations. Typical Wayne…talk all day about the grand vision and then never take a single ounce of action.

In the afternoon we go back to work and the productivity seriously drops. Wayne is on the phone with his wife texting and he didn’t prepare with ideas for some of the later activities in the book. We were coming up with activities on the fly and wasting tons of time thinking of unique questions to ask. We ended up powering through and finishing up as much as we could before he needed to leave to go coach his daughters softball team at 6:30.

As we’re packing up to leave, he hands me one of the workbooks and tells me to take it home with me to keep working. Of course, I hadn’t agreed to continue working from home. I had a very busy schedule and told him that I could only fit in the 9 hours we did today because I had other responsibilities.

We walk out the door and Wayne starts to get in his car to leave without paying me. I make a comment asking to get paid and he tells me he’ll send me a check in the mail in a few weeks. I’ve already been through this once before with him so I tell him I was expecting to get paid today. His response is that he doesn’t have enough money to pay me. At this point, I’m fuming. He runs his mouth all day about all this money he’s making with schools and coffee and now he can’t afford $225. Bull shit! At this point, I say no I want to be paid in cash. I’m not dealing with him giving me a check and then the check bouncing and me having to chase after him again. I also said I was expecting to get paid personally, not as a business consulting fee. For $25 bucks an hour, there was no way I was paying taxes on top of that. All of our work together is on my computer, so I have all of the leverage.

He’s in a hurry on his way to his daughter’s practice, so he tells me he’ll think of something. He realizes that I have the leverage, so he gives me a call later that night telling me he’ll meet me tomorrow and give me a check. About a half hour before our meeting, he calls me saying he needs me to bring an invoice and a printed copy of the work with me. Now that he’s broken the trust, there’s no way I’m handing over my leverage until I get paid and the check clears.

When we meet, he’s really pissed off that I don’t have the hard copies with me. We get into a small argument and I flat out tell him that I can’t trust him and that I don’t like the way he does business. If you truly can’t afford to pay someone, then you don’t leave that information until the end after they put an entire days worth of work aside for you. He assures me that the check won’t bounce and then I leave to go to another meeting. I then get a whole bunch of texts about how if I have a problem cashing the check to give him a call. This of course further reaffirms that I thought he was going to try and screw me again.

I deposited the check in my citizens bank account instead of finding a bank of America to cash it on the spot. In hindsight, that would have been the smart thing to do, but the thought didn’t even cross my mind. Wayne of course was pissed that I was now making him wait a full day until the check cleared and he went into a total breakdown.

I received about 15 texts from him that night freaking out. He was calling me a liar and doing all sorts of character assassinations. He was even completely making things up as if he was trying to rewrite history through text messages in case this came into a court battle or something. At one point he even threatened to show up at my house because I was depriving him of supporting his family. I only responded a few times to these outrageous allegations, but basically I said I will send it to you once I get paid. The number of texts and phone calls I got form him were absolutely ridiculous.

I sent him everything that Saturday when the check cleared and I haven’t heard from him since. Looking back on this experience, I definitely should have been very clear about how I expected to be paid before we started working together. This way he couldn’t have tried to pull his shit at the last second. I also should have just used my brain and really considered if it was worth it to work with him again. I knew the type of person he was and should have expected something like this to happen. He definitely hasn’t changed. Ironic that the only 2 people to ever fuck me over in business are Wayne and Matt Zinman. Very similar personalities and I met Matt through Wayne. To this day, Matt still hasn’t paid me the $1,500 he owes me and I’ve found out that he has scammed a bunch of other people as well. That’s another story for another day though.

Looking at the bright side, I’m happy that I did work with Wayne because it was a creative new experience and I did learn a lot throughout the day. We got a lot of really good work done together. I’m also happy that I understood the situation enough to not give up my leverage until everything was square between us.

Working out of a Starbucks in Yonkers, New York today because I’m visiting my friend Donny, whom I studied abroad with in Ireland. It’s his birthday this weekend and he had the awesome idea of renting a limo to take all of our drunk asses to Medieval Times!

After I finish this post, I’m going to head out. Time to write like a mad man for 45 minutes…

• I ended up as a finalist for the 2014 Bucks Happening Awards for web design. Red Carpet Bash was a great time.

 

• Back in March I stumbled upon the BBQ Central Radio Show podcast while doing some google searches. Sent the host, Greg Rempe an email and within a week I was on the radio show being interviewed. The complete interview can be found here http://thebbqcentralshow.com/march-4-2014-official-archive/ Awesome experience and my first time ever on radio. I listened to about 10 of his podcasts before hand so I had a good idea of what the show was like and what to expect. I prepared for any question he could possibly ask me and I absolutely killed it on the show. I even went as far as to ask Greg if he would fuck a cow! What? Yea…I did that, and it was hilarious. Let’s just say it worked perfectly into the context of the conversation.
• After airing on the show, I updated all of my product images to include the BBQ Central and Outdoor Cooking Channel logos. Leverage the credibility baby!

• I recently did a Google search for my name and found that I was quoted in YFS Magazine back in December and didn’t even know it. I remember responded to a reporter inquiry from HARO about tips for hiring employees, but never knew I was published http://yfsmagazine.com/2013/12/12/recruiting-new-employees-9-things-to-look-for-in-a-job-candidate/   I stopped receiving HARO emails a while ago because they were so time consuming and I rarely got published. However, now I’m back on the bandwagon because Cave Tools has given me more credibility and people seem to be responding. So far this week, I’ve already locked down a quote for a GrassHopper.com article and started speaking with a writer for Entrepreneur.com. If all goes as planned, I’ll be published in the Young Entrepreneurs section of the website. These are major credibility boosters and good old fashioned free PR
• Penn State Blue and White weekend happened a couple weeks ago and I took full advantage. A few weeks prior to going up, I emailed about 10 professors asking to speak in one of their classes. I got no responses back, so I messaged the Secretary of the head of the marketing department. She put me in touch with Brad Leve, who teaches a bunch of the 400 level entrepreneurship classes. I did two 40 minute speeches to his classes and they absolutely loved it. I took a video, but it stopped recording after 20 minutes so sadly I don’t have the whole thing to put on here.  I spoke about the 10 major lessons that I think young entrepreneurs need to learn in order to be successful. Basically, Brad said anytime I’m up at Penn State and want to speak he will fit it into his schedule because it was so good. Thank you Toastmasters!
• After my entrepreneurship speeches, I went down to the Career Center and hosted some internship interviews. They literally put me up in my own office and everything. I interviewed a handful of kids who were all dressed up in suits for their big interview. It felt crazy to be sitting on the other side of the table this time around haha I ended up hiring an awesome kid named Ryan for this summer and I think he’s going to do a hell of a job. He’ll be doing the SEO internship that Phil is currently doing now. It’ll be cool because the entire course is already bui.t, so I can spend my time guiding Ryan and improving the course.
• I also hosted a Cave Tools tailgate on Saturday at the game. Never realized how much damn work went into planning a tailgate and cooking for everyone. My friends came up big time in terms of helping out. We ended up with about 30 people ish. We cooked a vertical rotisserie pork roast, onion, and pineapple. Then we turned the grill into a regular grill and made burgers, dogs, sausages, peppers, and a bunch more food! It was a huge success!

 

• Starting in about 2 weeks, my cousin Matt will be doing a video seo internship and his girlfriend will be taking over our social media and press releases. I’ve outlined both courses for them, but haven’t had a chance to start creating the trainings. Nothing like a little bit of pressure to light a fire under my ass. I’m really looking forward to having all 3 interns working together this summer and freeing my time up so I don’t have to do all the content creation
• This week I had Phil take a step back from all of the seo stuff and do some good old fashioned human interaction. He scheduled 5 guest blog post exchanges with other bbq websites so we can start cross promoting each other. He’s also going to be interviewing the heads of 5 big competition bbq teams via Google hangout. Well edit the videos and create a meet the BBQ Team series. Each interview will be in video form, transcribed into text for a blog post, turned into a cool image for pinterest, and the audio will be stripped and sent into iTunes as a podcast. Phil is just as excited about this as I am. It’s a fun assignment and a great lesson in repurposing content for different marketing mediums.
• Yesterday I finalized my deal with WiseJack Cooking. From now on, all Cave Tools customers get a free 3 month subscription to their executive chef recipes service. Really cool service built specifically for men from world class chefs. It’ll help me build a bigger email list and they get more people dropped into their top end funnel, so it’s a win-win. Huge value add for us as well in up front sales, so I’m hoping to see conversion percentages increase.
• We also launched a VIP Reviewers club on the site to help boost our Amazon reviews. Another way to build an email list of buyers and keep them engaged. Check out our new bonus page format…pretty slick!

 

• We had a grill fest at my friend Matt Budensteins house the other day. We grilled ridiculous amounts of food all day and I even ate a grilled lambs heart!

• I also started shooting how to recipe videos for the recipe book to beef it up. The Carolina Spiced BBQ Dry Rub is my favorite so far…delicious!

• Cave Tools took a wicked slump in the winter this year. However, we’re only in April and I’ve already surpassed my peak monthly revenue from last summer. I didn’t start until May 28^th last summer, so I’m really excited for the upcoming growth. Especially now that I have 4 product lines instead of just the grill brush!
• With that said, it’s time to start thinking about another brand. No! I’m not abandoning Cave Tools. That would be crazy. I am however looking to start a completely new revenue stream where I can take advantage of higher frequency of purchase and higher profit margins. Remember that National Championship College Lacrosse Ring? How about we tie that into a sports nutrition brand for some credibility. This week I started looking into developing my own brand of proteins, creatines, pills, weight loss, all that kind of stuff. The idea is to let both businesses self fund their own growth. As long as I can keep producing enough content, I can keep marketing both brands effectively and build an entirely new income stream. Sports Nutrition is no joke though. The market is full of literally most of the top internet marketers in the world because of the amount of money at stake. In order to compete, I’m really going to have to step my game up a few notches. This is a serious challenge, but with my Cave Tools experience I have most of it planned out already. It’s just a matter of executing. I was joking with Justin the other day telling him that if I do this, I’ll have to change my FB name to Michael “Medium Rare with Extra Protein” O’Donnell
• I’m also part of an Amazon Mastermind now. There are 7 of us and we all sell products on Amazon in different niches. We do a Skype conference call every Friday to share our weekly successes, failures, and help each other work on problems in our businesses. So far, I feel like I’ve been sharing more than I have been receiving back, but that’s how I’d like it to be. I’ve picked up a handful of really good tips so far and I’m building some good relationships. Plus, just the fact that I’m speaking about my business every week and discussing goals, it keeps me accountable.

Ok, I just reached my 45 minute mark. I’ll post this on Sunday. Time to go have fun!

Back in October, someone posted this article on Facebook http://online.wsj.com/news/articles/SB10001424052702304626104579121813075903866 and a bunch of us got into a very deep discussion about it. The article was written by the creator of the cartoon Dilbert and discusses how the Secret of Success is Failure.

The controversial part of the article and the reason it generated so much buzz is because Scott Adams says that goals are for losers! If you read the article it will make much more sense, but the point he is getting at is that there is always a feeling of emptiness when you achieve your goals. You have that slight high and then you are faced with the question “Now What?” I achieved my goal, I should be happy because this is everything I have been working for for so long. Often times people get depressed or lose their focus because they don’t have a proper road map for after that goal. Scott says you should be focusing on systems instead of goals. When you have a system in place, failure is just an obstacle on your way to success. Achieving goals are just milestones on your journey. I completely agree with everything he says in the article. In my opinion, the set “Short, Medium, and Long Term” goals mantra that you always here is bull shit. It doesn’t work and it sets you up for failure.

Today, I watched a 1 hour presentation by Todd Herman (Google him, he’s a fucking beast) in which he explained a framework for managing your goals. This framework was like the Scott Adams article on steroids and has inspired me so much that I stopped everything I was doing to do my own self evaluation based on his framework.

If anybody is reading this blog post, I recommend you open this diagram in another window so you can follow along as I build my goal setting framework. I have no doubt that once you understand this framework that you too will want to reflect on your own life as I am doing now.

 

 

The top of the pyramid is “The Outcome” or what I ultimately want to do with my life. Ever since I read The 4 Hour Work Week, my outcome was to live that cush lifestyle and become a tycoon of business without having to work long hard hours.

As a full time entrepreneur for over 2 years now, I have gone through more bumps in the road than I care to recall. I’ve done the standard goal setting approach and have subsequently gone into mini depressions. I’ve lost my course more than a few times and at this point last year I was even calling it quits and looking for a “job” on career builder like a little bitch.

In Todd’s presentation, he talks about how “You set goals to feel alive. You’re searching for meaningful experiences of connecting a feeling to yourself deeply. “ But to bring things full circle you need to go Through your outcome.

The brain interprets things very literally. If your goal was to make it to the NBA, but you got a career ending injury 2 weeks after signing to a team, what kind of fulfillment is that? Yea you achieved your goal, but now what?

When Todd works with professional athletes, he gets them to tell him their outcome and then he repetitively drills them with the question Why? Why is that your outcome? It normally takes about 17-23 times of answering the Why to get a substantial answer from the person and to get them to see Through their goals.

If you asked me a few years ago what my outcome was, I would have said to live the 4 hour work week lifestyle. Some of my other answers would have been to make money, to have freedom, to achieve lifestyle design, to be able to move out and support myself on my own as a business owner.

The final “outcome” I just listed has been my biggest goal over the past year. I’m living at home right now and it sucks. I’m missing out on lots of things that I will never get back in my early 20s. Yea, I go out all of the time and do fun stuff with my friends, but I don’t have the autonomy I had when I lived on my own in Montreal. I can’t just bring a random girl home from the bar. It’s difficult to get into a relationship with a girl when everyone I meet lives 45 minutes away and I would basically just have to crash at their apt every weekend like a leech. These may seem like superficial kinds of desires, but they’re true and they are a major part of your early 20s. So that has been my outcome since I moved home from Montreal. Living on my own and supporting myself with my business has been the epitome of my “Success.” If I could just achieve that outcome.

The truth of the matter is that everything I just listed above is just a goal that if I achieved, I would feel empty inside and maybe go through a little depression because of the “Now What?”

Todd says that to get Through your goals, you need to add the words “so that.” The So That helps you build “Your Story” around your outcome goals. I want to move out of the house so that I can regain my autonomy. But there is so much more to that once you start asking Why?

I want to achieve these things so I can give back what? So I can do what? Why am I breaking my ass trying to build 2 companies at the same time and taking on ridiculous amounts of work? Is it to make a million dollars so I can be a young playboy and bang super models? Yea, that would be great for a while, but are money and lifestyle my true end goal or outcome? Or is there a different outcome that I want to achieve. Something that will give me a fulfilled life and make me feel happy.

Taking on my first intern has been an amazing experience for me. I have the opportunity to mold a young budding entrepreneur and pass on all of the skills and knowledge I’ve acquired over the years. Teaching my intern gives me an amazing sense of fulfillment and when I listen to myself giving him advice it puts everything into perspective on how far I have really come. Being a mentor and the person he looks up to for guidance and advice makes me feel truly happy. It’s like I’m experiencing what it’s like to be a father for the first time. Teaching your children the right mindset and giving them advice so you can watch them grow up and succeed in life in whatever they do because you helped them build a solid foundation.

Public speaking has also been a passion of mine for about 2 years now. I love the rush I get when speaking from stage and have often envisioned myself giving seminars to 1000s of people from stage and teaching them. That’s always been a goal of mine. The underlying motivation here really comes back to teaching and giving back.

I’ve always had a very capitalistic mindset. The idea of volunteering and giving back has never been something I could truly relate to. One day when I have tons of money I’ll give back, but until then I just need to focus on making tons of money. I remember when I was working with Wayne and he asked me why I was trying to launch the National Alliance for Student Debt Awareness with him? My response was that I wanted to make money and that I wanted to expose myself to him so I could learn from somebody that had much more experience than I did. I never really gave a shit about “The Cause” like Wayne did. My motivations were selfish (in a good way) and I was very clear about that.

Now that I’m reflecting and going through this exercise of using the goal setting framework, I see that I CAN give back and I CAN make lots of money and achieve all of those other goals at the same time.

So what is my Through Outcome that I’m busting my ass to achieve?

I want to build Hyacinth Marketing and Cave Tools into power brands and I want to build them in a highly scalable way that allows me to achieve lifestyle design. There’s no doubt about that. But I want to do these things SO THAT I can pass my knowledge on to my interns, students, family, and friends. So that I can speak from stage and help change people’s lives. So that I can do my Couch Surfing Across America trip. So that I can travel the world and have incredible life experiences. So that I can meet new people and share stories with them. So that I can be the exception and show other young people that if they really want something that they can achieve it. So that I can choose something new to learn each year such as learning a new language or becoming a true competition BBQ Pitmaster AND have the time to devote to these things. So that I can acquire all of the knowledge and skills and experiences that many people could only dream of.

That is my true Through Outcome when I look at my life as a full circle. Not just some empty goals that I want to achieve. I set out to start my own marketing agency, now what? I set out to build a physical products business, now what? Just like the NBA player I achieved those goals, but there has to be more. This is my more and this is my destiny in life.

The mid level of the pyramid is your performance goals. These are the goals you need to achieve to reach your desired outcome. Typically, for 1 outcome goal you will have multiple performance goals that you need to achieve to get there.

Here are some of my current performance goals:

1. I will develop the processes for a call center so I can expand the website development portion of Hyacinth Marketing by 1 week from today.
2. I will implement my project management software marketing strategy to build copious amounts of back links and increase my exposure and referrals for Hyacinth Marketing by 1 week from today
3. I will start developing my 4^th Cave Tools product line and launch by the end of May
4. I will start to penetrate the Competition BBQ community and leverage my exposure to grow Cave Tools by 1 month from today

Before moving on to the final stage in the pyramid, we need to discuss the difference between Ow! Brainers and WOW! Brainers. Performance goals are great, but the difference between achieving your through outcome and failing lies in the way you have trained your brain.

Both Ow! Brainers and Wow! Brainers follow the same path in life. You have your starting point, your goals, and your Ideal Outcome.

People that are Ow! Brainers are stuck because they are constantly trying to go from Goal to Outcome. Wow! Brainers on the other hand, focus on getting from their starting point to their goals.

Ow! Brainers are fantastic at saying I started here and I’ve done all of this work and I still haven’t achieved my desired outcome. They quickly come up with all sorts of excuses as to why “This isn’t for me” or why it will never work out. They jump around from opportunity to opportunity and they eventually quit because they never get to achieve the desired outcome. They look at the top of the pyramid and say holy shit that’s a far ways away. They build their internal story around this mindset and then they quit. I’ve been on the Ow! Brainer side of things plenty of times so far in my life and I can completely relate to this mindset. I’ve accomplished a shit ton of things in my short career, but I still haven’t reached the financial success I have always been striving for.

Wow! Brainers are different. They go from the starting point to their goals and then they look back and say holy shit, look at everything I have just accomplished. If I keep making progress every day and knocking off my performance goals, I’ll eventually achieve my desired outcome.

Yea, I’ve achieved a shit ton of things in my short career and the monetary gain hasn’t been there yet. But the Wow! Brainer side of me says look at all of the knowledge and skills and experiences I have acquired. If I keep at it, I will achieve my Through Outcome because I’m building a foundation that can never be taken away from me.

This brings us to the bottom level of the pyramid which is your Process. Your Processes answer the questions of What, How, and When. The beauty of this stage is that YOU are 100% in complete control over your processes and how you spend your time. Performance goals are only about 90% in your control and there are other factors that affect whether you hit your performance goals or not. Processes are 100% on you. You need to take Personal Responsibility if you want to start hitting your performance goals.

A Process Goal for me would be that every day I am going to spend 10 minutes researching online and reaching out to BBQ teams and Pitmasters to give them free products or ask to be a sponsor. The great thing about the Process stage is the old 1% theory. If you work to get better at something by just 1% every day, then it will take only 70 days until you have doubled your effectiveness in that area. If you follow the 1% rule for multiple areas of your life every day, it will have a geometric compounding effect.

The Process stage sums up the entire framework with the word “INEVITABLE” By building and following your Processes, you make it INEVITABLE that you will knock off your Performance goals and reach your desired outcome.

It doesn’t matter that I haven’t been a huge financial success yet because I have a framework or system in place that I follow every day. It may take me a few more months or a few more years before I will be able to start living my Through Outcome the way I envision it. The point is that it truly is INEVITABLE that I will make it there.

As long as I am making progress each day, I will hit the bend in the exponential curve and everything will fall into place.

IT IS INEVITABLE

To put this post into perspective, last night I went out into Philly for a $28 open bar from 9-12pm. I got 3 times my money’s worth of the open bar and I loaded up with 4 more mixed drinks before 12 to keep me going the rest of the night. We didn’t get back to my friends place until around 2:30AM.

As I mentioned in a previous post, I am busy as all hell with different projects that I am working on and at times I have been feeling completely overwhelmed. Luckily for me, I built an in house project management system last week and have been offloading everything in my mind into it because I literally haven’t been able to sleep for weeks because my mind is racing. I’ll make another post soon on the Project management system because I have a ridiculous marketing strategy behind it that will help grow Hyacinth Marketing exponentially over the next 6 months.

With that said, I am no stranger to work hard play hard. I got my ass up and made my way to Starbucks by 11:30 this morning and have been working ever since. Normally I just go right into things and get lost in my work until around 7pm at night (sometimes forgetting to eat because I am so immersed). At that point I go back over to a friend’s apartment and get blasted and go out.

Today is different. I closed all of my email down and decided I was not going to work at all today. I was going to spend my entire day working on myself and knocking off self education goals that I have been sidelining.

I just finished watching a presentation that has been on my list for about 2 months that I’ve been putting off. This presentation moved me so much and really struck home, so I decided to place all of my notes and pictures below.

In another post, I will be working through my own thought processes and building out my own framework. I’m also planning to reenact this exact presentation on video myself because for me it was that incredibly powerful and the notes don’t do it justice.

Your Potential – Todd Herman:

Frameworks for unleashing your potential:

 

For athletes that have been very successful, they hate when people say they have a lot of talent. The reason is because talent refers to genetics and basically says you did nothing to get where you are, you were born with it. Code is your genetics, the stuff you were born with

Competence is the collection of skills you have built over time and knowledge you have acquired. Everyone has the capacity to get more of competency.

The Catalyst is the motivating force or the drive that you have within you.

Kids are a great model to look at. They have what’s called intrinsic motivation. They have a desire to learn to grow and to explore the world around them.

When Competence and Catalyst match up you get motivation.

When Competence and Code match up, you get “A Calling” something you were drawn to do.

When Code and Catalyst come together you get Confidence.

This model is called the performance protocol. When all 3 are working together, your performance matches your potential. At that point, Code pretty much gets taken out of the equation

 

 

Goal Setting Framework:

 

Heider Simmel Study: We as human beings despite whatever information is in front of us, we attach a story to everything.

Most people goal set to a destination. Once you get there you feel kind of empty. That’s because you went to it, but you didn’t think through the goal. You need to go through that goal and tell the story of that goal.

You set goals to feel alive. You’re searching for meaningful experiences of connecting a feeling to yourself deeply.

Most athletes and type A individuals are really really good at the “Outcome”. What is it you’re shooting for. If you are not getting the satisfaction when you achieve your goals then you are focusing on the Outcome too much. You need to go Through your outcome.

Examples of outcome goals: Winning the race, getting a medal/trophy, making X amount of money per year.

How to goal set through the outcome. If your outcome goal is to retire, you goal set through that by saying so you can travel, so you can be your own boss, it’s the why behind it. Think about what you are giving or what it will do for me to achieve that outcome goal.

When you keep repetitively asking someone why they want to do this? The surface answer is rarely something that really evokes a lot of emotion and motivation. Keep asking someone Why and then typically by answer 17 or 23 you will uncover the real Through Goal.

Outcome goals are great, but you need to develop that story around it. The middle level is performance. Performance goals sound like this:

I will improve the number of vendors I reach out to in China from X to X+5 by Date

I will improve the number of sales I get from 10 per day to 20 per day by 1 month from now.

This model works for anything you are trying to achieve. The key words are “So That” I will shoot for this outcome goal so that I can give this back or so that I will be able to do these other things.

I will improve my pushups from 10 per day to 100 per day within 1 month from now so I can get ripped and live a healthy life style so that I can play with my kids and not get tired out from being a fat ass.

How is not important in this stage. If you have 1 outcome goal, you will typically have 3,5,10 + performance goals so you can hit that mark!

 

Performance goals are very important because there are 2 types of people. Ow brainers and Wow brainers. The word success is a crap word. Value is a better word.

Einstein had a great quote: He said don’t become a seeker of success, become a person of value. None fears value. People have a fear of success but nobody fears value.

You have your starting out point and then you have the where do you want to get to. What’s the ideal. Both Ow! Brainers and WOW! Brainers have the same path.

Now you establish your goal in the middle. If you are caught in the OW brain side you are stuck trying to go from goal to outcome. Versus people on the WOW side who focus on getting from the Start Point to the Goal. You need to work your way out of the OW brain side. Most people are not wired to be on the WOW side.

Ow brainers are fantastic at saying I started here and I’ve moved forward and done all of this work…but I’m still not at my ideal. This isn’t for me, I’m not going to do this.

Wow brainers are not the same as everyone else. You start at your start point and now you’re here (wherever that is) and here is what you do differently if you’re a Wow brainer. You say look at everything I’ve just accomplished.

Ow Brainers look at the top and they say wow that’s a bitch to get to the top, it’s never going to happen. You start telling yourself some bullshit story about how you’re never going to get there and why it will never work. How you’ve quit a million times before

Wow brainers are looking up from the bottom at the next stage and saying look at all I have accomplished. Let’s keep going because I’m making progress towards the top and I’ll eventually reach my outcome goal.

If you implement this model in your life it gives you a framework to run your days and achievements through and catch yourself. If you’re stuck on the Ow side and you just do this over time, you rewire your brain. You’re not stuck where you are, you can change yourself.

If you’re an OW brainer don’t write down what you want to do today, write down what you don’t want to do each day and start tracking that shit.

Everybody always keeps some type of log book about everything they are planning to accomplish each day. At the bottom of each day, put a little number from 1-10. Over time you will start to see patterns on what your “8” days look like versus what your “2” days look like.

Your next questions are What, How, When? At the bottom of the triangle is your Process that you will do to achieve your performance goals.

Every day I will wake up and do 4 sets of pushups until failure. Today I might only be able to do 40 pushups. Tomorrow I can do 42. A week from now I can do 60, and so on.

You have control over Process Goals 100%. You are responsible. Performance goals, you have control maybe 90%, Process is all you 100%.

If you are an athlete you are constantly bombarded with did you win the game? If you are a parent and you weren’t at the game, the worst thing you can do is ask them did they win the game? Children internalize that as if I win because mom and dad get excited about it, that means that they love me. Sports are about developing, learning, growing, gaining skills. Not about winning. You’re not toughening up your kids, you’re teaching them what not to be.

Process goals are all about the What the How the When and how to schedule that into your calendar. Follow this framework and you build a real support system to achieve your performance goals.

The word that sums this entire framework up is “Inevitable” How can I make it inevitable that I can retire by the age of X so that I can give the lessons that I’ve learned to my family or friends, help them to achieve some of the things that they want to go after, and do more of the things that I really want to do such as travel, experience new things, meet new people, tell people about my journey.

You make it INEVITABLE by doing the PROCESS goals and reaching PERFORMANCE goals. The lessons that you learn along the way are the things that are so incredibly valuable to you and everyone else around you.

The great thing about the PROCESS area is the 1% factor. If you improve yourself by just 1% each day, how many days does it take for you to double your effectiveness in that area? Just 70 days…

If you do this in multiple areas of your life, the improvement is geometric and has a compounding effect. Instead of asking yourself how can I be incredibly successful? Ask yourself how can I be Average today? Take the pressure off of yourself. Schedule in 2 days of the week where you are just going to be Average. It’s amazing when you release a whole bunch of that pressure and those average days becoming amazing and great days.

3 Things to take action on right now.

1.)    Know your outcome and wrap your story around it. How can you go through that outcome?

2.)    Measure your performance. Simple numbers, I will improve X to X+ by deadline.

3.)    Build the process. Give it some legs underneath it and energize it with action stuff.

The brain has an amazing way of seeing to the horizon line 3 months out. 1 year goals are hard for the brain because it is a little bit too foggy to see that far out. Do 3 month focused sprints.

Is my 3 month goal going to be mastering the mechanics of getting stuff into Amazon? Build the process and performance metrics around it. Give yourself the deadline a sprint to it. Chase it!