Increasing Profits, Marketing, Personal Branding No comments yet

Ways To Increase Your Powers Of Persuasion

By Vik on January 24th, 2013

The six ways of increasing your influence – from Robert Cialdini's classic book Influence: The Power Of Persuasion.

Reciprocation.

People have a natural sense of “fairness” – if I receive something from someone, I should repay them in some capacity. This makes it harder for people to say “no” to a request after they have already received something of value.

For example, the American Disabled Veterans organization sends out mailers asking for donations. They conducted a test: one group of mailers were sent with a simple form letter, while others included a form letter along with a small gift – such as personalized address labels. The result? A 100% increase in donations.

Commitment

People don’t like to break commitments. This is not just true with legal contracts or large, binding commitments; the motivational force is strong for all levels.

For example, a restaurant owner in Chicago was concerned because many people made reservations but didn’t actually show up, so he made a simple change. He instructed his receptionists to stop saying, "Please call if you change your plans" and to start saying, Will you call us if you change your plans?" The no-show rate dropped more than 60% within two months.

Consistency

This is simply another word for “brand.” Companies like Starbucks make large margins because they have built “authority” as a

Authority.

Authority is valuable because it conveys the perception of expertise. If you have achieved certain things, or have certain skills/abilities that others don’t have, you can charge a substantial premium for your time.

One expert at building authority is Ramit Sethi, author of the best selling I Will Teach You To Be Rich. He leveraged his Stanford education, entrepreneurial background, and NYC selling author status to launch the Earn1k course. Although this course is expensive, he has no problem getting a lot of costumers because his expertise is perceived to be very valuable.

Social Proof.

Most people are followers. If they see a trend, they are much more likely to jump onboard.

This is why good testimonials are so important. If people have seen that other customers are endorsing what they’ve bought, they are more likely to buy themselves.

Scarcity.

Have you ever seen the “only 2 more hours to buy!” icons online? This is the power of the scarcity tactic – people are more likely to take action when they perceive that an opportunity might go away.

This is the power of the Daily Deal business model. Companies like GroupOn make billions of dollars by creating a short-term opportunity, which dramatically increases sales.

Liking/Friendship.

This is an obvious one – people are more likely to say yes when they already like somebody.

However, it manifests itself in non-obvious ways. For example, my good friend Brian Crane runs a website called LuckyGunner, which is targeted at the hunter equipment niche. The site features an attractive blond named Heidi who is the “face and voice” of the LuckyGunner brand. The men visiting the site love Heidi, and thus they are much more likely to buy.

 

Motivation and Productivity 2 comments

I’d Do It, But…

By Vik on September 13th, 2010

“I’d do it, but….”

How many times have you said these four words before? I personally say them all the time – way more often than I should. When we say things like this, we’re setting up psychological barriers. We want to accomplish or change something in our lives, but are having trouble putting in the effort. So instead, we come up with excuses on why we can’t achieve our goal.

“I’d ask her out, but I don’t think she’ll say yes”

I’ve personally said this all too many times, and I’ve always regretted it later. You never know until you try. Sure, I’ve been shot down a lot, but putting my heart on the line also helped me get into a truly rewarding relationship. The times that I regret most are the times that I never even tried.

“I want to learn about personal finance, but I’m afraid to ask my friends because they’ll think I’m stupid.”

Never feel afraid to learn. It is impossible to know everything, and most people will be impressed that you are making an effort. And if they don’t, who cares what they think? Seriously – your personal education and ability to make good decisions are far more important than how other people view you.

“I’d go exercise, but I really need a new pair of gym shoes.”

Don’t go out and buy the shoes right away. If you go for this kind of instant gratification, you’ll just end up coming up with some other excuse. The shoes will sit in your closet unused and you’ll have wasted a bunch of money on nothing. Instead, use the shoes as a reward for achieving a goal. For example, if you run five times a week for a month, you’ll buy the shoes for yourself. This will motivate you to start exercising right away.

And of course…

“I’d like to earn more money, but I don’t know how…”

For starters, keep reading this blog =)

But seriously, if you want to earn more money, you shouldn’t stop constraints like time or lack of capital get in the way. There is always a solution, it’s just up to you to find it. Here are a few ideas to help you start taking action:

1. Take responsibility:

The word “but” is an excuse, a way to avoid owning up to something. Instead, take responsibility for your goals and come up with a solution. Otherwise you’ll just end up procrastinating all of your tough choices.

2. See the end goal:

Understanding the end result allows us to focus on the positives. When we make excuses, we’re usually focusing on the negative aspects of anything. So take a moment to understand the reason you are working so hard. If you really want it, you’ll feel a strong boost in your motivation.

There’s a chance you’ll realize that you don’t really care that much about the end goal. This can be a scary realization but it’s actually a good thing. You shouldn’t be putting a ton of effort into something that doesn’t matter to you; that’s a surefire recipe for getting sucked into a black hole. Instead, cut your losses and focus your energies on something more worthwhile.

3. Make yourself accountable:

Find other people who can “spot” you when you start making excuses. It’s one thing to let yourself down, but it’s a lot harder to rationalize when you feel you are letting down others. I used this trick when I was trying to get in shape. Instead of just working out by myself, I’d set a schedule with friends. This way, if I didn’t go, they’d know that I wasn’t following up on my commitment.

A final thought: This is an excerpt from a poem by Shel Silverstein. It definitely got me over my "buts" and I hope it does the same for you!

"All the Woulda-Coulda-Shouldas
Layin' in the sun,
Talkin' bout the things
They woulda-coulda-shoulda done…
But those Woulda-Coulda-Shouldas
…All ran away and hid
From one little did."

What are some of the tricks that you use to overcome excuses? Please share in the comments section

Making Decisions, Motivation and Productivity 6 comments

The Difference between Passion and Drive

By Vik on September 25th, 2010

My friend Lisa is a professional musician. She practices and performs more than 60 hours a week, all for very little money. She is a very intelligent person who could probably have a much more secure job, but in her own words she “loves what she does.”

I have another friend, Maggie, who is a corporate attorney. Like Lisa, Maggie works long hours in the office. She doesn’t particularly enjoy her work (although she is very good at it), and she is rewarded with a large paycheck every two weeks. When I asked her why she decided to be a lawyer, she answered that “it was the safe thing to do.”

What is interesting to me is that both my friends are motivated to work hard and excel at their careers, yet their sources of motivation stem from two completely different forces: passion and drive.

A lot of people confuse passion with drive. After all, they both seem to accomplish the same end result – the motivation to succeed. But there is a key difference, described by Randy Komisar in his classic book “The Monk and the Riddle.”

“Passion and Drive are not the same at all. Passion pulls you towards something you can’t resist. Drive pushes you towards something you feel compelled or obligated to do. If you know nothing about yourself, you can’t tell the difference.”

Well said, Randy. Passion is addictive; it flows through us naturally and pulls us towards something that we desire. Lisa’s passion was the joy of creating music. Everything else – the lifestyle, the performances, the long hours, was driven by this singular passion.

Drive is different – it is about outside expectations. Perhaps society wants you to do something (like go to graduate school or take a secure job). Maggie doesn’t particularly like her career as an attorney, but the stability and respect she commands from her friends and family is a tremendous motivation.

Is passion better than drive? I think so, for one simple reason: your memories. Passions tend to evoke positive memories and experiences – things that you actually want to remember, as opposed to the things you did because you felt you had to. When you look back on things, you’ll have fewer regrets.

So take a moment to define your passions. What is that pull that you can’t resist?

Increasing Profits, Marketing No comments yet

Focus on Solving Real Problems: A Dog Food Story

By Vik on November 7th, 2011

Several decades ago, a dog food company held an internal sales conference. First, the advertising director presented an exciting new media campaign. Then, the director of marketing explained his new go-to-customer strategy that would “change the industry.” Finally, the sales director got up and excitedly talked about how their sales team was the best in the business.

The President listened patiently through all of these presentations. At the end, he got up and said. “Look, I only have one question. If everything we do is so great – our sales, marketing, advertising – then why do we sell less dog food than everyone else in the industry?”

The room went silent. No one knew what to say. Finally, someone offered a thought: Maybe it’s because the dogs HATE our product.

The point of the story is that it’s important to focus on the real problems. We often get distracted by stuff that doesn’t really matter. In this case, the company had been focusing on sales, marketing, and advertising. While those are important areas, they should have spent more of their time discovering, defining, and addressing the real problem: a lousy product.

So how do you solve a real problem? How do you create a product that people actually want to buy?

It’s a good question. There’s no secret sauce or magic recipe that guarantees success. But there is one concept that will 100% steer you in the right direction.

It’s simple: make something you’d buy yourself

Sounds obvious? It is! And it makes sense: if you are looking for something to buy, chances are there are others who want to buy it as well.

If you are creating dog food, take a moment to think about whether your dog would actually eat it. If not, you should rework your product. End of story.

This applies to any product. Whenever you create something new, ask yourself one question:

“Would you (or someone who know) actually use this?”

If the answer is no, then think about what you can do differently to turn that “no” into a “yes.”

Be honest with yourself. After all, you don’t want to waste your time and money on something that is doomed to fail.

Over the last few months, I’ve actually been hard at work at developing/expanding some of my own products. I’m not quite ready to share all the details, but needless to say, I’ve been doing a ton of research on what it takes to create a kicka$$ product that will make me lots of money. Here are some of the best writeups I’ve stumbled on:

The No Fail Approach To Product Creation. Pat Flynn over at Smart Passive Income always an amazing job, and this post is no exception. Pat lives by a simple rule – don't create anything you wouldn't use yourself – and it has served him well.

7 Things You Must To Do Make Your Product Launch Easier – Dave Navarro at the Launch Coach has a whole ton of articles on how to conceptualize and market an outstanding product. This is easily one of the best, definitely a must-read.

Don't Just Roll The Dice: This is actually a free e-book about how to set the right price for your product. Very well written, and a good read for anyone who wants to launch something new.

What are some products that you think would solve a real problem?

Increasing Profits, Personal Branding 1 comment

Three Ways You Can Make $5,000 Per Hour (or more!)

By Vik on September 15th, 2011

$5,000 per hour.

It sounds crazy. Almost too good to be true, really. But when you think about it, there are actually a lot of people earning this much.

Here’s the secret: it’s not like they are actually billing clients at $5,000 per hour. Instead, they are using their time in a way that yields huge payoffs at some point in the future. Eventually, the cash starts piling up, and their “relative income” goes through the roof.

Here are the three things you can do to increase your income…if not to $5,000, then certainly to higher than where it is right now:

1. Build (And Own) Something Of Value

This is clearly the best and most common way to make a lot of money. Almost every super-rich person (from Bill Gates at Microsoft to Sam Walton with Wal-Mart) has made their money by building a large, profitable business.

Of course, you don’t need to build an empire to increase your income. For every billionaire, there are thousands of millionaires who do the same thing on a smaller scale. One businessman I met makes millions of dollars every year by shipping equipment supplies to miners in the Sierra Mountains. He purchases the supplies at a discounted bulk rate and provides a service that allows him to sell them at a much higher price. He has a trusted relationship with his buyers and has outsourced most of the actual work, so his time commitment is low. But he keeps the majority of the profits because he is the owner.

2. Earn Some Big Commissions

Being a middleman isn’t as profitable as owning your own lucrative business, but the good news is that you take a lot less risk. After all, you’re just taking a commission from a sale. You don’t have to put any of your own money into something that might go under in the future.

This is how investment bankers make all of their money. They find large corporations that want to acquire smaller companies. Then, they negotiate a transaction and take a nice chunk of the final sale price. When you’re selling a billion dollar company, even a small percentage can add up to tens of millions of dollars.

Now, I know that you can’t just start conducting billion dollar transactions overnight. Instead, a more immediate way to boost your hourly rate is to become a passive middleman.

Here’s an example: one guy I know recently bought an outsourcing company based in the Phillippines, where he pays people between $8-$11 per hour to do data entry and basic accounting tasks. He then charges companies in the states $30+ per hour to do the same work for him. All he has to do is negotiate the initial contracts, and then he just keeps collecting checks every month.

3. Become An Authority

In 1985, Robert Kiyosaki was living out of his car. Through a bad series of investments, he had ended up completely broke and was a step away from being out on the street.

Today, Kiyosaki is a best-selling author who has turned his “Rich Dad, Poor Dad,” books into an iconic brand, complete with seminars and a lucrative line of information products.

A pretty impressive turnaround in 25 years, so how did he do it?

In the late 1980s, Kiyosaki realized that things needed to change. He started investing more wisely and soon had amassed a sizable real estate portfolio. In 2000, he wrote the bestselling Rich Dad, Poor Dad, which focused on his upbringing in Hawaii and the many mistakes he had made over his career. His rags-to-riches story had lots of appeal and quickly established Kiyosaki as an authority on personal finance and investing.

Most of the information in the book is common sense, but it has more weight coming from Kiyosaki. This is the power of being an authority.

Have you managed to increase your income using these techniques? Please share in the comments.

Increasing Profits, Personal Branding No comments yet

Make More Money By Becoming Indispensable (Finish)

By Vik on October 6th, 2014

Seth Godin is the man.

Seriously. Every time this guy puts something out, it casts things in a whole new light. And his latest book, Linchpin, is no exception.

In Linchpin, Godin focuses on what it takes to become indispensable. Godin’s view is that you need to put your heart and soul into whatever you do, and that passion will make you a Linchpin, a unique asset that cannot be replaced.

I agree with Seth. Passion is important. But it isn’t the only ingredient in becoming indispensible. Here are three additional methods that people have used to become linchpins – successful to the point that they make $50,000 in a single week or even $5,000 per hour.

Method #1: Be A Connector

Several years ago, I was talking to a good friend of mine who worked in venture capital. We were discussing various investment opportunities and I suddenly remembered that I had another contact who was in the process of starting a company. On a whim, I decided to put them in touch. I sent out an e-mail introduction and let them take it from there.

A year later, I got an excited call from my friend. “Vik, remember how you put me in touch with Jim? Turns out we’re going to invest in his company! We’ve been talking for several months now and things have been going great. Thanks so much for connecting us!”

Having a great network is invaluable, but sharing it is what makes you indispensible. Whenever you’re meeting people, think about how you can leverage your network for their benefit. You could make introductions to potential clients or business partners, or at the minimum, let them know that they are free to ask at some point in the future. If you establish yourself as a consistent source of good contacts, people will stay in touch with you and help you out whenever you need it.

Method #2: Be An Influencer

Influencers are indispensable simply because they have an audience that trusts them. Once you’ve built trust, you can easily convince your audience to buy your products. Gain influence, and the money will take care of itself.

Here are some examples of how people have established themselves as influencers:

Ramit Sethi: A blogger-turned-author-turned-entrepreneur, Ramit started writing at iwillteachyoutoberich.com in 2004. At the time, the blog was nothing but a hobby; a tool to teach people about personal finance in a fun and interesting way. Within a few years of consistent high-quality writing, Ramit was getting more than 100,000 unique visitors per month to his site. Young people loved his easygoing, humorous approach for teaching a subject that’s traditionally pretty boring. This led to the publication of a best-selling book, and the creation of his own line of personal finance products. Even though Ramit is young, he has successfully established himself as an influential figure in the competitive world of personal finance advice.

Deepak Chopra: For a long time, Deepak Chopra was a successful but relatively unknown medical doctor. In 1985, Chopra met the Maharishi Mahesh Yogi, a leader in the transcendental meditation movement, who invited him to study Ayurveda. Chopra suddenly realized that there was a golden opportunity to combine traditional western medicine with the preventative healing methods in South Asian tradition. In 1987, he wrote his first book, “Creating Health,” which was a top seller and established Chopra as an authority in the new “preventative healthcare” area. Since then, Chopra has written more than 20 books, opened up hundreds of clinics and Ayurvedic Centers, and of course, made tens of millions of dollars.

Steven Covey: In 1989, Covey wrote a bestseller called “the seven habits of highly effective people.” This was not the first book in the self-help genre. However, Covey distinguished himself by coining a new term: the idea of an abundance mentality. The idea here was that optimistic, effective people believe that there are enough resources to share with others, rather than hording it all to themselves. This was a unique approach and contrasted sharply with the more traditional mentality of maximizing personal gain. Covey was successful at being an influencer because he defined a whole new area of expertise, and instantly became a leading authority.

Brian Clark: In 2005, Brian Clark was already a successful entrepreneur. He had generated substantial profits by scaling offline businesses using the power of the internet. The problem was that no one knew about it. To fix this, he started Copyblogger, a content hub for information on how to grow your business using online tools. Today, the site has more than 120,000 subscribers and has spawned three seven-figure businesses. Clark has also been mentioned in numerous blogs and books, enhancing his authority even further.

Method #3: Be A Specialist

It’s much easier to demand lots of money if you are a specialist…but you have to specialize in the right field. Here are two things to consider when narrowing down a speciality.

Something that no one else can do:

One day in college, the elevators stopped working in my building. A few hours later, the elevator repairman stopped by to fix the problem. I was walking by, and we ended up getting into a conversation.

Turns out he makes around $150 per hour.

I was pretty surprised at first. But then I realized that it actually made a lot of sense. Elevator repair is a very specialized job. There are only a few professionals in each city, so this guy just goes from building to building…and he mints money along the way.

Something that has business value:

My parent’s next door neighbor is currently a Vice President of Engineering at Apple. Although he’s been out of school for more than 25 years, he’s still incredibly talented at understanding and designing the latest high-end technologies. This depth of knowledge and specialization is what makes him indispensible to the company.

Another great example is Neil Patel, an entrepreneur who made his fortune by establishing himself as an SEO specialist back when the industry was just starting to evolve. Everyone wanted traffic from Google, but not many people knew what it took to get there. By finding a few big-name clients and getting testimonials, Neil quickly established himself as an invaluable resource when it came to developing a user base online.

Are you indispensable? If not, how do you plan to get there?

Increasing Profits, Personal Branding No comments yet

How My Friend Made $50,000 in a Single Week

By Vik on September 1st, 2014

A few months ago, I was having dinner with Mark (that’s not his real name), a friend who had recently started an online marketing business in San Francisco. When I asked him how he was funding his new venture, he said “Vik, you’re not going to believe this story…”

Rewind to November of 2009. A few months before, Mark had left his lucrative job on Wall Street to set out on his own. At the same time, a large online marketing company called QuinStreet filed to go public on the NASDAQ. All of a sudden, Mark was bombarded with calls. All of his Wall Street buddies wanted the inside scoop on the industry. What exactly was online marketing? How did this company make money, and was there potential for growth?

Most of Wall Street knew nothing about the online marketing business, and they were hungry for any information they could find. After all, millions of dollars were on the line.

At first, Mark decided to be as helpful as possible. He took the calls and answered the questions as well as he could based what he knew. But a few calls in, he had an epiphany:

Why am I not getting paid for this?

Back in his Wall Street days, Mark had used a resource called GLG which connected Wall Street analysts to industry experts around the world. The analysts would pay the experts a generous hourly wage for their time and insights. So Mark called his contact at GLG, and requested to be put on the expert list for any online marketing inquiries. Before he knew it, Mark was charging $400 per hour for his time.

But it didn’t stop there.

As it turned out, several of the callers wanted more information. Mark’s general thoughts were helpful, but did he have any data or “competitive analysis” that they could use to better analyze the investment opportunity?

So Mark decided to write a detailed industry report on online marketing. Using completely public data, he put together a formal analysis, filled with charts, graphs, and numerous insights on the online marketing industry. It took him less than a week to complete. The price? $5,000 per copy.

To date, he’s sold eight copies. You can do the math.

Here’s the kicker: My friend was by no means an expert on online marketing. He had spent his entire career on Wall Street. Sure, he was a smart guy with a strong statistical background and the ability to learn, but that certainly didn’t make him an expert. But the fact that he could convince others of his credibility allowed him to charge huge amounts of money.

So what can we learn from this? Here are a few thoughts:

Perception is Reality: Sad as it might be, it’s important to give off the perception of success and expertise. This perception is what allows people to charge absurd amounts of money for their time and insights. You may be a real expert, but it means nothing if no one knows it. Therefore, it’s always crucial to develop, maintain, and grow your personal brand and make sure that the buyers understand your value.

Your Time is Valuable: Your time really is your most important asset. If people are using it to make money, you should figure out a way to get paid. It’s ok to give away a bit of your time to generate some upfront interest, but never let people take it for granted. Understand that they are getting value and that you need to be compensated accordingly.

Presentation Matters…A Lot: I’ve known Mark for awhile now, and I’ve always found him particularly impressive. He’s a terrific salesperson and is extremely entrepreneurial. He always brings a unique energy to any situation. These personality traits added a huge amount to his earning ability. Also, his industry report was very polished and professional. It was written in a way that Wall Street analysts appreciated and understood. Mark maximized sales by presenting his value in a package that made sense to the buyer.

Leverage Price Signaling: When I was studying marketing in college, we learnt about a concept called price signaling. The basic idea is psychological: if you charge more for a product, people will think that it has more value. If Mark had only charged $100 per report, the analysts would have probably thought that the information wasn’t that crucial. But at a $5,000 price point, Wall Street analysts saw this as a “must-have” product. $5,000 per report isn’t much money for Wall Street, but it’s enough to garner their respect and interest. Of course, you also make more money at a higher price point =).

Finding Great People, Increasing Profits No comments yet

How To Profit From The Greatness Of Others

By Vik on February 27th, 2013

I was recently watching a Warren Buffett interview, and one quote really stuck out:

“The best way to generate an income is to have a useful talent…like helping the sick or writing a new piece of software. Of course, if you’re like me, and have no talents, you can succeed by investing in those who do…”

-          Warren Buffett

Ok, maybe Buffett is being a little too modest, but he makes a good point. Talent cannot succeed without resources, so if we don’t have the talent, we can make a really good living by investing in those who can do the most with the cash.

In fact, not being “talented” is one of the things that allows Warren Buffett to be so successful. By acknowledging his lack of expertise, Buffett gives more freedom and autonomy than most investors. He doesn’t try to micromanage his employees; instead, he simply lays out expectations, provides the right incentives, and steps in whenever they need a helping hand. This allows him to invest in far more companies than he otherwise would.

In short, he’s using his time efficiently while making his employees happy. Win-win.

Continue reading How To Profit From The Greatness Of Others →

Increasing Profits, Marketing No comments yet

Harsh Realities Of Business

By Vik on January 31st, 2013

Sexy Businesses Aren’t Actually That Sexy

Five years ago, a small social network called Facebook started to gain a lot of traction. Around the same time, MySpace was sold to News Corporation for nearly $600 million.

All of a sudden, lots of entrepreneurs and investors were pouring their time and money into social networking. After all, it was the next big thing, so how could anything go wrong.

The problem was that many of these people didn’t know anything about social networking, or even about the internet in general. They saw a success and wanted to copy it, but had no real vision about how to differentiate themselves.

The same thing happened with Groupon three years ago. The “daily deal” concept was easy to understand, but difficult to execute without a strong understanding of the local advertising market. However, lots of people saw an “opportunity” to get rich quick by starting their own daily deal sites.

Once again, most of them failed horribly, resulting in a huge waste of time and money.

Instead of jumping on the bandwagon, think about how you can solve a real problem that you actually understand. Even though this problem might not be “sexy,” it will definitely give you the best chance of success.

One good example of this is Cash For Gold, a business that buys gold jewelry for a serious discount and then sells the gold to other investors. The business made more than $100 million in revenue in 2010, with fairly gigantic profit margins.

Cash For Gold isn’t the “sexiest” business, and the company also engages in questionable business practices, but no one can argue with the fact that they are printing money.

Things Fall Apart:

Nothing is more painful than working for months on a partnership deal or prospective sale, only to see it fall apart at the very last minute.

I spent the early days of my career at a bank, pitching deals to rich clients. I can’t even count the number of hours I’ve spent writing documents and models that have gone nowhere.

The worst part is that sometimes there’s nothing you can do. It just wasn’t meant to be. But more often than not, you can at least increase the chance that the deal will go through.

First of all, be willing to compromise. Sometimes, tweaking the deal terms just a little bit can help alleviate a tense situation. Most of the time, making these small concessions is far better than losing the deal altogether.

It’s also important to show that you really want the business. Emphasize that you value the relationship and make sure to bring up the positives of moving forward. One of my good friends sealed a multi-million dollar affiliate contract simply by sending over a package of beef jerky.

Finally, be patient. Good things take time. Lasting relationships are not built overnight. Strong partnerships are the result of many hours of discussion, deliberation, and research. Don’t apply more pressure than you have to, or you risk things breaking down.

This last point is especially difficult for me, since I am a very impatient person, and it’s an area where I still need to show a lot of improvement. Any suggestions here are more than welcome.

You Can’t Do It All:

It’s important to know your limits. No matter how much you know or how talented you are, you simply can’t do it all yourself.

Tim Ferriss writes about this in depth in the Four Hour Workweek. After his first business, BrainQuicken, started to take off, Tim was working 15 hour days trying to ship orders, return calls, and build new partnerships. His dream of owning a profitable, growing business was quickly turning into a nightmare.

To his credit, Tim quickly identified the problem and came up with a solution. He realized that his strength was marketing and business development. Therefore, he hired people and set up automated systems to manage the back-end operations of his business.

The result? Increased profitability, improved inefficiency, and a whole lot less stress.

I owe a lot of my own business success to other people.

Increasing Profits No comments yet

How To Save Lots of $$$ Without Changing Your Lifestyle

By Vik on November 14th, 2012

Focus on the Big Wins

One the main themes in Ramit Sethi’s popular blog “I Will Teach You To Be Rich” is the idea that you should focus on the big wins. In personal finance, that means that you’ll save the most money by cutting back on a few big expenses rather than trying to penny-pinch every step of the way.

For example, Ramit talks about how some of his readers saved hundreds of dollars each year just by switching to a low-cost brokerage account and finding the best credit cards. Check your credit card statement for monthly charges – chances are you’ll find some subscriptions (a gym membership or a credit report service) that you never use. Cut those costs first! These are “high-return” situations  – they take very little time, save you lots of money, and best of all don’t require any change in your lifestyle.

Another great option is the daily deal sites. There’s nothing wrong with going out to eat or treating yourself to a weekend getaway. But why pay full price if you don’t have to?

It’s just another application of the 80-20 rule: 80% of your gains come from 20% of the effort. The trick is to identify that 20% quickly and maximize those particular opportunities – both in personal finance and in life.

Interestingly enough, many people who claim to be frugal are in fact “penny-wise and pound-foolish.” They’ll try to save $2 on coupons, but will pay massive annual fees on credit cards and subscriptions that they never use. Don’t become one of these people! Figure out how much you can save upfront with just a few big wins. You’ll be surprised at how big a difference it can make.

Don’t Overcommit Without Knowing What You’re Getting

A couple of years ago, I was looking to hire an SEO (search engine optimization) company for one of my web projects. I interviewed a bunch of candidates and finally narrowed in on one company. Everything seemed to check out: great references, terrific work history…and the guy I talked to was really friendly.

Eventually, we started talking about price. He gave me two options – a monthly fee, or a larger upfront fee that would guarantee me services for one year. I did the math and realized that I’d be saving a bunch of money by paying upfront, but I was still a little concerned.

When the guy saw that I was interested in paying upfront, he went in for the kill. “Listen sir, I promise that you will get outstanding quality service here. We know that our fees are expensive, but the one year option will definitely make things more affordable.”

I was sold.

Fast forward a few months. The SEO company was a total disaster. They weren’t delivering the results that I had wanted and they were incredibly unresponsive. I was getting angrier and angrier, and demanded my money back. Of course, they refused. After all, there wasn’t a whole lot I could do about it.

It was my own fault. I had overcommitted. I had gotten carried away in the moment, and wrote a large check without knowing all the facts. Had I gone with the monthly plan, I could have cancelled at anytime. This would have motivated them to keep working hard. But by giving them the money upfront, I ended up getting sucked into a major black hole.

This actually brings me the final point: if you’re going to hire people….

Hire On A Contract Basis

Anyone who’s ever had to make a hiring decision knows how hard it is to make the right choice. In a tough economy, every job listing gets hundreds of responses. It’s fairly easy to whittle the list down to a few qualified candidates, but how do you make the right decision? After all, some people might be great during an interview but won’t be the best performers on the job.

The new contract economy provides an effective solution. As the job market gets more competitive, qualified applicants are more willing to accept paid contract work that could potentially lead to full-time employment in the future. By hiring someone as a contractor first, you can quickly and cheaply find out if they fit the needs of your organization.

The contract economy is a boon for cash-strapped startups. Around Silicon Valley, many startups hire new employees on a three-month contract to see what they are capable of accomplishing. After the three month period, the startup and contractor can decide to extend the contract or part ways.

For example, ODesk, a leading internet network of contract employees, actually uses its own technology to hire contractors for technical copywriting, customer support, and server maintenance. This allows ODesk to identify the best people quickly while keeping costs low.

But contract employment isn’t just a win for the employer. By having a chance to evaluate the company while getting paid, the contractor can also see if the job is a good fit. The short-term nature of the contract also allows employees to keep their options open and look for opportunities elsewhere if they realize the job isn’t a good fit.

My own story – A few years back, I accepted a contract role with a startup in the Bay Area. It was a short-term deal with the possibility for full-time employment if things went well. Although I really enjoyed working with the management team, I just wasn’t that passionate about the product. A few months later, one of the senior executives asked me if I would like to join full-time. I said no – I’d thought about it a lot and decided that this just wasn’t the best opportunity for me. We parted ways on good terms.

This was a good decision for both parties – the company hired another contractor (who ended up being a better fit), and I moved onto projects about which I was far more passionate. I had also made some money and some great connections, while providing much-needed business development skills to the company. Overall, a win-win that wouldn’t have been achieved through a full-time hire.

What are some ways that you’ve achieved savings without changing your lifestyle?

Finding Great People, Motivation and Productivity, Personal Branding No comments yet

Eight Small Steps to Move Outside Your Comfort Zone

By Vik on March 19th, 2012

A few weeks ago, I was at a conference when I struck up a conversation with an older businessman. As we talked about the economy, I mentioned how it was really important for people to constantly adapt in an ever-changing world.

The businessman turned to me with a surprised look. “I’ve been with my wife for forty years, and I’ve worked at my company for the same amount of time. I know just about everything there is to know about what’s important in my life. I don’t really think stepping out of my comfort zone will teach me anything new that actually matters.”

I disagree. The world around you is always changing. People change. Businesses change. What helps people make more money and lead better lives is their ability to discover and adapt to these changes. To do this, you need to step outside your comfort zone.

It isn’t easy – after all, we’re creatures of habit. We don’t like change. With that in mind, let’s start small. Here are eight baby steps to help you move out your comfort zone.

Continue reading Eight Small Steps to Move Outside Your Comfort Zone →

Motivation and Productivity 1 comment

Stop Making Excuses and Just Go For It!

By Vik on March 12th, 2012

“I don’t feel like going running today…I’m too tired.”

“I can’t believe that Jessie made so much money on his last company. I am way smarter.”

“She’s so annoying…I can’t believe she said that to me. If I had my way, I’d give her a piece of my mind.”

We all make excuses. It’s a natural way to let out our frustration once in a while. The problem is when it becomes a habit.

Continue reading Stop Making Excuses and Just Go For It! →

Making Decisions, Motivation and Productivity No comments yet

Lose the Jerks

By Vik on March 5th, 2012

I recently got this e-mail from a good friend:

“Hi Vik. I need a bit of advice. I have this co-worker who is a total jerk. He keeps bad-mouthing me and generally gets in the way of my productivity. I’ve made some efforts to fix the situation; after all we’re supposed to be helping each other, but nothing works. What should I do?”

I like to think that most people are nice and generally mean well. But every once in a while, you get someone in your life who is a real jerk, someone that you just can’t deal with. This could be a boss, a co-worker, or an acquaintance. Most people reason that this is part of life – they just have to put up with certain people.

My approach is different: Lose the Jerks

Continue reading Lose the Jerks →

Motivation and Productivity No comments yet

Crawl Before Walking, Walk Before Running

By Vik on February 20th, 2012

A few years ago, a good friend of mine set a New Year’s resolution of getting in shape. He was planning to hit the gym at least five times a week. On January 1st he went to the gym and worked out hard for two hours.

The next day he was extremely sore, but he insisted on “pushing through the pain.” He went in for another two hours…and ended up pulling his hamstring muscle. He was sidelined for a few weeks, and he never really gave the gym another try.

It was really too bad. He genuinely wanted to get in shape, but the immediate setback really dampened his enthusiasm.

A better approach is to take baby steps: crawl before you walk, and walk before you run. If you haven’t been to the gym in awhile, don’t try to push yourself too hard on the first day. Ease yourself into a routine; do a little bit each day. Over time, your body will get more used to the workout and you’ll be able to step things up a notch. This way, you’ll minimize the chance of injury and maximize your chances of success.

Of course, getting into a good workout rhythm is different from expanding your network and personal brand. These goals are even 

more long-term, and it’s important to constantly be taking little steps in the right direction.

Spend time with a different group of people: Once a month, try to make some new friends. Find people who are outside of your immediate social circle and call them up for lunch. The best part about this is you may even make some amazing relationships or business connections.

Try a different job function: Most people are very good (and are comfortable doing) one or two job functions. See if you can get an opportunity to try something new. For example, if you are an engineer, you might ask to go on a sales call to help explain the more technical aspects of your product. You’ll build confidence and you’ll develop some new skills along the way. As a bonus, your boss will probably like the extra initiative.

When in doubt, just ask yourself “what’s the worst that could happen?” You’ll be amazed at how a little perspective will help you feel more comfortable.

Stop procrastinating: There are two reasons we procrastinate – laziness and fear. Remember that if you are scared of something, putting it off isn’t going to solve the problem. In fact, the stress will only build up over time.

Instead, just do it! Tackle the tough stuff first and get it out of the way. This will relieve your mind of the stress of waiting for something bad to happen.

Over time, you’ll feel more and more confident, and can start taking larger steps. This positive loop will eventually produce big results.

Just remember, any step, no matter how small, is better than doing nothing at all.