Shawn, welcome to Sidepreneur Magazine! Please take a moment and share with us how you got your start as an entrepreneur.
I was working with my wife at Direct Energy, which is an energy supply company in Columbus Ohio. I was a pricing analyst. She was an executive assistant. We got the call in 2008 that our company was purchasing a company in Pittsburgh, and we had a choice: move or lose our jobs. It was a tough decision. We decided to move because I could upgrade from my contractor role and become a full-time employee. It was really exciting—especially considering the economic downturn. Everybody else was losing their jobs. My wife and I were both employed. We had a good income.
We began commuting daily from a small suburb of Pittsburgh. The drive was between 30 and 45 minutes each way, and the job was very monotonous. After a while, I became good at my job. My production rate was going up, and I was getting recognized. They were looking at me as a team leader.
Two years later, my wife decided to get a Master of Education degree. She worked full-time while attending school full-time. Suddenly, her life was very busy. With my extra free time, I could either become really good at video games like Madden 2010 or I could do something that I always wanted to do: start a business. I used the extra time to research online business opportunities.
I soon learned about passive income, but I looked at it very skeptically. I thought it wasn’t real. Even now, I don’t believe in passive income. Then I met someone online who knew how passive income worked. They taught me about using blogs to generate income from advertising.
With that information, I outlined a 45-day plan to start making money online. I worked the plan, and I was soon making $100 a month. Then it turned into $300, $500, $700 and so on. I thought, “Wow! This is actually real.”
My income still wasn’t passive. As I said before, I don’t believe in passive income—there are just systems that help you to work smarter. I learned that passive income on its own, for me anyway, was not a business with which I was satisfied. It was a tactic. It was a way that I could make money.
The money was good, especially considering that all I had invested upfront was $800. I had used that money to hire a writer because I knew more content would produce more ad revenue. I recouped the investment in 90 days. I’ve been cash flow positive since then. Since passive income generation didn’t strike me as a viable business, I wanted to build something more substantial.
I realized there were a lot of people just like me creating content for passive income. They were writing a lot, or they were getting people to write for them. There were some content creation companies, but I thought I could do a better job. I asked a writer if they had time to take on more writing projects. They said, “Yes.” I started to broker their time. They wrote content to fill orders for my clients. In a month, I had 25 different writers working for me via e-mail.
I had a real business! I called it The Content Authority. I still own it, and we are producing between 5,000 and 10,000 pieces of content each month. We have 8,000 writers, and we have clients who need content. We are playing the broker in the middle. The business is doing well, and it allowed me to go into full-time entrepreneurship 3 1/2 years later.
Well, that’s impressive.
Yeah, I think it was the right time to start a content creation company. Today, I would have a much more difficult time getting out of the gate as quickly as I did. I was in the minutia of trying to make passive income and I found the gap—there’s a very similar one now in podcasting. There are many businesses starting up to address the pain that podcasters have. They are creating show notes, producing audio and so on. All these businesses are doing it sort-of “OK.” If somebody really wants to capture that market and do a solid job, they can create a business around it. It’s definitely a go-to thing right now.
Yeah, I agree. I’d love to know the tactics you used to create a passive income, but that’s for another interview. Let’s get back to mindset questions. What changed in your thinking that allowed you to start a business while other people were content with watching TV?
I think the difference for me has always been about being willing to take risks and try things that I’ve never done before. And I think I had a good example in my entrepreneurial parents. My Dad was always starting new things to make a side income. He was an iron worker, so he was working 40 to 60 hours a week. Then on the weekends he was thinking, “Hey, I want to create a maple syrup company.” So he bought all the maple syrup equipment. He would make a plan and start acting on it. If his plan didn’t work, he would start something new.
What my Dad did was an example for me. Because of him, I have a natural bent to try something that I’ve never done before. What’s the worst thing that could happen? You could “fail.” But that’s just a failure in somebody else’s eyes. I don’t think people fail in business. I think they have experiences that are not positive, and that some might consider failure. But you can always turn failure around and use it for good in your life and business.
Even with your Dad’s example, did you feel fear as you were taking those first steps toward starting side businesses?
I would say I felt the fear of not pleasing my wife, and fear of wasting money. I wanted to feel like I was a success in what I was doing. I also wondered, “Am I going to make it?” But I don’t dwell on whether I’m going to make it or not, and I don’t have a lot of fear.
So do you think fear is a good or bad thing?
I think fear is an incredible motivator. The month I finally was able to go full-time into The Content Authority, my business income dropped by 30%. We were going to take this trip across the United States and have two weeks off. I was concerned. I wondered, “Are we going to make it? Will we survive this next month?” It was a scary time. But when you face that fear, you can choose to curl up and feel paralyzed. Or, you can make decisions that create the income you need. Going back wasn’t an option.
Did you feel tension between your role as an employee and your role as an entrepreneur, and how did you deal with that?
I was quite vocal, and I was very excited about what I was doing on the side. I would let co-workers know. I’d let my boss know. I told them it was going well, and that I had plans to move on from there. Being so vocal created some tension, and I think it prevented me from moving up in my job as quickly as I could have.
But, my side work let me build online marketing skills and to help build out a small business web platform for my employer. So yes, there was tension, but it also allowed my employer to leverage the experience and expertise I was building. I think it would have been wiser to stay quiet about what I was building on the side.
Did you burn bridges with that employer? Do you have any regret about how you left your job?
The full story is that the business was streamlining and shedding some weight. I was ready to leave in March of 2012, and a buddy of mine said, “Hey Shawn, just wait a couple of days until after the bonuses are paid.” And lo and behold, they had staff cuts. I was let go on bonus day. I was the antithesis of everybody else. I was ecstatic because I was ready to leave, and now they wanted me to leave. Also, they gave me a severance package because I was now a manager. I couldn’t believe it. I don’t believe this was an accident. I think it was timing. Just waiting a couple of days changed everything.
So no, I didn’t burn any bridges. I worked as hard as I could to do a good job and to leave a great impression. My boss from that job and I are still connected on LinkedIn. My previous boss and I are close—very connected. He’s since moved as well and started his own consulting business. I’ve worked with him to build their Web business. I had a good working relationship with him.
In your opinion, are you able to affect more people for good as a business owner than you could have as an employee?
Yeah absolutely! Here’s my thinking on job creation, and why I think a business owner has one of the most impactful things to offer a community. They can create jobs—not only for themselves, but for other people. The jobs they provide allow others to take care of their families. I believe owning your own business affords you the opportunity to do this, not just one or two times, but 100 times.
You’re also providing customers value, and helping them get what they need in life and business. I think that’s powerful. It’s why I started focusing on sidepreneurs. If I can reach 100 sidepreneurs, I know they can reach three or four times that as their businesses grow. That allows my impact to explode.
As a business owner, you have a real opportunity. At The Content Authority, we are now providing income to about 100 writers every week. That’s powerful. Just knowing I’m helping them is exciting.
I think the corporate employee is limited because they are not in charge. To make a great impact as an employee, you need to get into leadership so you can help other people. You’re either going to lead or somebody else is going to lead you. A good leader is a good follower. So take direction at your job while you build your side business. Don’t play the game of working for yourself while you’re at your job. It just doesn’t hold up. People see right through it.
Have you thought about the legacy you’re leaving and how having a business impacts that?
Yeah, I have crazy goals here at Sidepreneurs. I want to help 10,000 entrepreneurs go from their side businesses to full-time entrepreneurship. It impacts society at a pretty interesting level. Perhaps it’s not a worldwide impact, but it’s 10,000 people with full-time incomes. That’s impactful!
I think there are other more important legacies I’m not yet building. My wife and I don’t have any kids, so I don’t have that opportunity yet. But I think investing in our nieces and nephews far outstrips anything in business. That’s an important legacy for me.
What new habits have you created that have helped you succeed in business?
Early on, I was working 90 to 100 hours a week because I didn’t have systems in place. In my content creation business, I would find clients, take their orders, and delegate to a writer. The writer would send their work back to me, and I would send it to the editor. The editor would send it back to me or to the writer for revisions. After revisions, the editor reviewed it again and sent it back to me. After all this email exchange, I returned it to the client. Completely inefficient.
We decided to outline the process and turn it into a software system. Building that system for content creation was the best thing I did the first year of my business. Instead of continuing to manage all the orders by email, I created a system.
Now, I look at my daily tasks—the things that I’m good at and the things I’m really bad at. I say, “How can I create a system either by creating software or a process of delegation?” Cultivating a systems mindset helps save a ton of money in staff costs. Systems help me have enough margin in my business. Now I apply this kind of systems thinking to all of my businesses. Systems are my friends. Systems help me to scale the business and do more in less time.
On my podcast, I have interviewed entrepreneurs who are far outstripping anything that I’m doing. A key part of all their success is systems.
While you were building your side business, how did you balance work on the side with your job and other commitments? What did you learn in that process that others can apply?
One of the important things I learned was to take a Sabbath. I learned to take 24 full hours off in a given week. I neglected this discipline for a while and it created stress in my business and in my relationships. When I got back on track, it alleviated that stress. Even apart from religious reasons, I think we should consider taking that time off. It is good for the body, it’s good for the mind, and it’s good for the for the soul to have some distance from work. It lets you recoup.
There is always pressure to do more in less time—to get things out the door more quickly. But at what cost? I don’t think people need to work seven days a week to make an income. I’ve worked seven days a week, and I can tell you it made no financial difference for me. I just don’t see the benefit.
I agree. When I’m tired, I produce less than when I’m rested, so I think this is excellent advice. Let’s move from how we spend our time to how we spend money. Did you borrow money to build any of your businesses?
Yes, I did borrow money to speed up my business growth. It didn’t work. The debt was just an added expense. It was unnecessary. I was unwise in that decision. It was probably one of my worst business decisions.
Should sidepreneurs consider borrowing money to start a business?
Pre-sell your service or business offering. Just get a group of people to pay you before you launch or pay you upfront for services. That way, you should never need to borrow money. If you think you have to borrow money to stay afloat, I would challenge your thinking. Reconsider whether you even have a viable business idea. Yes, you can throw money at marketing and reach people faster. But if you have a great product or service that fits your market, you’ll be profitable from day one.
I started a business last year called Book Marketing Tools to help authors market their books. It had to be profitable immediately because we weren’t going to borrow money to get it off the ground. We started slowly. Now we are seeing good results because of the slow build up. It’s not earth-shattering, but it’s good.
I think debt can work as a financial tool. People are doing it. But I recommend against using it.
What is the best advice you can give sidepreneurs about money management?
Understand your revenue—your costs, and your margin. Every week I look at my business finances and ask, “What were all the revenues? What were all the expenses, and what’s my margin? I use an Excel spreadsheet. I read all the income based on the product line. I review all expenses related to each product line, and track how much margin that business has for this week in dollars and in percent.
Since I’ve been doing this, we are making wiser decisions about our money. We are not spending money on frivolous things. We’re not investing in things that don’t work. If it’s not working, we’re not doing it. This weekly audit has helped my business. I recommend others develop a keen eye toward everything they spend.
Last year, I assessed the website subscription fees I was paying. I calculated that I was spending nearly $500 each month on unnecessary things. I thought they were important, but it was $500, and that’s a lot of money. You can hire a virtual assistant for 20 hours a week with that.
How important is friendship to your business? Do you rely on friends for inspiration and encouragement?
Treating people well in business is vital to just being a good human being. It sounds simple, but I think sometimes people lose sight of the idea that business is not just about making money. It’s about responding to each other in a positive and uplifting way. In business, you can’t confide in everyone. I have a small circle of people who I connect with regularly.
Chris Dreyer is a good friend of mine. We met online, and now we do some projects together. He is doing an amazing job with attorney marketing. I went to St. Louis a couple of months ago and hung out with him for a week. We “masterminded” as they say. We picked each other’s brains about business. Then, he called me on a Sunday night to wish me a happy birthday. That, to me, is cool—it’s just awesome!
I think relationships are important. My circle of close relationships is small even though I’m connected to many people.
You are acknowledging that we can’t be close to everybody. You’ve got to focus on a small number of people.
Yeah, and I don’t hang out with people because I know they’re making millions, and I want to be there. I hang out with people who exemplify the traits I want in my life and business.
How do you recommend we respond to people who are critical of our dream of starting a business?
It really depends on the source. I am not at all risk-averse. I always believe everything is going to work. I sometimes have a false sense of hope. My wife, by contrast, is very risk averse. She always wants assurances that things will work out. That can be a challenge, but it is also an opportunity to see my blind spots. Cautious people keep you from being so excited that you’re blinded to risk and to things that could go wrong. Listen to them with wisdom. Look for what can help you in your business, and don’t see them as entirely negative. If you’re really set on your business idea and you know how it will work, don’t be afraid to share exactly how it’s going to work.
That said, there are some people you’re going to meet who will suck the life out of your idea. They think nothing is ever going to work out, and they’re not doing anything to change that for themselves. I distance myself when people are not willing to contribute anything positive.
On the opposite side, where should aspiring entrepreneurs look to find people who will champion a dream?
I think that everybody needs somebody in their corner. I think it’s important that you try to find supporters. At the same time—and lesson learned—others may not be as excited as you are about your dream. I suggest finding somebody online in the same market space. Finding like-minded people online is easy.
Don’t be intimidated to reach out to the star influencers in entrepreneurship. Many of them are more than willing to spend a bit of time to get to know you and encourage you if you’re giving them value in return. Reach out by social media or email them directly.
I am interested in how you cope with uncertainty. Share a story about a decision you had to make “in the dark.” How did you go ahead? Ultimately, did it take faith to make that decision?
Faith is about trust. I believe that we are created in the image of God. There is this automatic desire in us to create. We are just born with that. I think it’s really cool that we have the same trait as God. But we need to question who we are really trusting. Are we trusting in ourselves to make it happen, and is this really what God wants for us? Or, are we just so blinded that we think God wants us to have it?
I believe that God gives us skills and abilities to do work. I am not 100% clear on how God blesses our businesses, but I know that he does. I’ve been at low points, like when our sales dropped by 30%, and at that moment you really get tested to know who you are trusting.
Yes, we can trust ourselves to make it happen, but I also need to trust God. I need him to give me wisdom. If I believe God created the entire world, then he can help me make an income this month. Faith is a part of everything I’m doing. Every evening when we pray over our meal I remind myself, “Thank you for providing this.” God provides for us.
Where it’s appropriate, I share with people at work. I believe that God has helped me figure this stuff out. I don’t see how I would have gotten here without God’s help.
You talked earlier about that dip when your business dropped by 30%. What kept you going at such a discouraging time?
I really didn’t have any options. I was either going to work through this or we were not going to eat. And I would rather eat. To eat, I needed to make money. To make money, I needed to fix the problem. How I grew up may have played a big role in that. If things were tough, Dad would figure out a way to make some money.
In 2007, before I was working for Direct Energy, I didn’t have a steady job. We had a mortgage, and I took four other jobs to make ends meet. That’s just what you do. So when income dropped 30% for The Content Authority, I said “OK. What do I do next? How do we turn this around?”
What book do you recommend for prospective business owners, and why do you recommend it?
The book is The One Thing by Gary Keller and Jay Papasan. The authors ask, “What’s the one thing that I can do or eliminate today that would make everything else easier?” We often set lofty goals like becoming a world-renowned speaker. With such a large goal, it is easy to focus on all the little things that stand in the way. Instead of just setting one large goal, the authors recommend breaking that goal into smaller goals. Work backward: one year, one month, one week, one day, one hour, right now.
What’s the one thing that I can do right now that moves me toward my goal of becoming a world-renowned speaker? Perhaps I could join Toastmasters. Maybe I could get on other podcasts or magazines and learn from them. I can use those guest opportunities to hone my message. If you’ve ever wondered what to do next, this is a great book.