8 questions on how I became an entrepreneur.

This week I had a fun interview on entrepreneurship. I wasn’t talking to Inc., How I Built This or Squawk Box. I was interviewed by Jayson Koel, a sophomore at Germantown High School in Germantown, Wisconsin with great hair. Jayson is taking an entrepreneurship class and is working on his own business, an apparel company called Midwest Running Club. Which I assume doesn’t sell Speedos to New Englanders.

Jayson (Y ask Y there’s a Y) had 8 good questions for me that I thought would be worth sharing with others who are considering entrepreneurship, or who simply wonder how someone gets started on their entrepreneurial journey.

This is Jayson Koel. Check out that flow! (And the t-shirt his Dad and I designed.)

8 Questions on Entrepreneurship with Jayson Koel

  1. When did you know you wanted to own your own business?

At the very beginning of my career. I immediately loved the idea of creating my own version of an advertising agency. I was always envious of entrepreneurs for being brave enough to do what everyone else dreams of doing. And I think envy is a great navigational tool. (Unless you are on a ship. Then you should use real navigational tools.) 3 years into my career a film director I was working with told me I had to start my own agency in order to secure my future. I took the advice. And I wrote about it here.

2. How did you prepare to get started?

I spent 19 years learning how advertising works, building relationships, creative skills, leadership skills, and nunchuck skillz. Because girls only like guys who have great skills. I had a subscription to Inc. magazine that whole time and continuously studied entrepreneurship. I surrounded myself with other entrepreneurs, and learned how they thought, and increased my courage and confidence through their examples. Then, in the last 6 months before I launched The Weaponry, my advertising and idea agency, I bought The E-Myth, by Michael Gerber, which is a great how-to book on how to run a business the right way. Even for southpaws.

3. Who helped you start your business?

My cousin Brooks Albrecht and I launched The Weaponry together. Brooks was in Seattle working for Amazon, I was in Atlanta, working at Moxie, the largest ad agency in Atlanta. We collaborated and planned and made things happen from opposite corners of the country, with a 3-hour time difference between us. We used Zoom, Slack, Google G-Suite, and Dropbox while planning the business because we had to to bridge our distance. That created a perfect infrastructure for the business operations too. Brooks was like a rocket booster and stayed with us for the first year, then peeled off and rejoined Amazon full time. He is now a rockstar at Chewy.

4. What obstacles were incurred in starting the business and how were they overcome?

Our first and largest client in year one was only a 1-year client. Which meant that we had to figure out how to quickly grow and replace that revenue in year 2 and beyond. I had seen what happens to businesses that don’t continuously grow by attracting new clients. (They go out of business.) So from the beginning, I developed a mindset that all of our clients were going to disappear on New Year’s Eve each year, and we would have to start again with all new clients the next year. But at the same time, I wanted to treat our clients so well that they never wanted to leave. Those 2 approaches of continuous business development and excellent customer service have kept us going and growing.

5. What are your characteristics that have benefited you the most as an entrepreneur?

My relationship skills. Personal relationships have always been important to me. And I quickly realized once I started The Weaponry that the hardest part of entrepreneurship, which is relationship development and maintenance, was something I had been working at for the past 30 years. And that has made my entrepreneurial journey really enjoyable. My creative skills, strategic thinking, and careful financial approach have also benefited me significantly as an entrepreneur. My optimism and sense of humor help a lot too. Entrepreneurship is a roller coaster ride. Believing each down will be followed by an up keeps you from throwing up your cereal every morning.

6. Where do you see this business in 10 years?

Large and in charge like Large Marge. We will grow significantly, have offices across the country, and will be sought after by the very best brands. (I shared my actual goals with real numbers and specifics with Jayson to give him a sense of how big I am thinking. But talk is cheap. So I’d rather show the rest of the world what we have done than talk about what we hope to do.)

7. What are the rewards of owning your business?

There is great peace of mind when we go through difficult economic times like we have experienced over the past year. I am still in control of my own future, and won’t be ejected by a business that wants to save money by dropping me like a hot bowling ball. There is also a great sense of control over my life and my future. I sink, swim or fly based on my own actions. I love creating a team culture, working with people I enjoy. Your earning potential when you own your own business is unlimited. I also get to decide on the company t-shirts and hoodies. And I never have to regret not starting my own business.

8. What advice would you give to my classmates and me?

Start thinking about owning your own business right now, while you are still in high school. Keep your eyes open for entrepreneurial opportunities all along your journey. Learn a craft really well so that you are good enough at it that you can start your own business someday. Develop and maintain your relationships. And read Rich Dad. Poor Dad. by Robert Kiyosaki and The E-Myth.

Oh, and start a blog. Share what you know with people and make them laugh if you can. People love to laugh as they learn, except when they are drinking really hot coffee or peanut brittle and it shoots out their nose.

Great advice I didn’t take, but maybe you should.

In the first half of 2013 I was in New York City every week. I was the Chief Creative Officer of a 275 person ad agency called Engauge. And we were in the process of selling the agency. A four person leadership team from Engauge shared our story, our work and our finances with 15 potential suitors, ranging from Conde Nast to the Paris-based advertising agency holding company, Publicis, who eventually purchased the agency. However, Conde Nast provided the greatest challenge in the process, because the room that we presented in was plastered with oversized prints of topless women. Which lead to my short-term bout with Attention Deficit Disorder.

LGA

One evening after one of our many meetings with potential investors on Wall Street, Engauge President Jeff Hilimire and I headed to the Laguardia airport for our flight home. But first we stopped and grabbed burgers at a barely-open Five Guys at the airport. It was in that small, yet-highly caloric moment, that we proceeded to have one of the most important conversations of my entrepreneurial journey.

Going through an exit (sale) process like we were going through, you are forced to think about the next chapter of your career. Because depending on who purchases your business, some unknown combination of the leadership team will no longer be needed in the new organization. Some of us were on the business equivalent of a Kamikaze mission. Or maybe it was the business equivalent to Russian Roulette. Or maybe I am just being dramatic with an international flair. Either way, Jeff and I each discussed our future in a very open Komono way (I can’t stop).

The Only Job For Jeff.

Jeff told me, ‘There is only one title I ever want again.’

I was curious what that was, so of course I asked, ‘What’s that?’

He said, ‘Founder.’

As a successful entrepreneur, his only interest was in starting businesses and in being an entrepreneur. He found no appeal in helping the company who bought the company that bought the company that he started.

But what about me?

I also had a great desire to start my own business. But unlike Jeff, I didn’t have experience starting my own agency from dust and growing it into a thriving success. So in between bites of my oversized Adam Albrecht Burger from Five Guys, I asked Jeff for advice on how I should get started on my entrepreneurial journey.

Jeff said, ‘The first thing you need to decide is where you want to start your business. Find a job in that market, move there, and spend two years developing your network there, while working for someone else.’ He said that after two years of serious networking, you should have the base you need to go out on your own, and start your own agency.

What I Did

This was really good advice. But I didn’t take it. Instead, I launched my advertising and idea agency, The Weaponry, in 2016 in Atlanta. But then, for family reasons, decided to relocate my family to Milwaukee. And of course, the business had to move too. Which means that I did the opposite of what Jeff suggested. I started a business, and then moved it to a new city, where I hadn’t warmed up my network at all.

From the beginning, my strategy was different. My network is very broad, with strong and valued friends and connections across North America. So I was determined to develop The Weaponry to be geographically agnostic. Technology has enabled us to live into my vision, and serve clients across the United States and Canada.

2 Years Later

This week marks the 2-year anniversary of our move to Milwaukee. So I couldn’t help but reflect on Jeff’s advice. The Weaponry is thriving, with great clients from coast to coast. But there is something special happening now. There is an interesting momentum building. We are being talked about when we aren’t around. We are contacted more than ever. People are stopping by, and inquiring about us, and wanting to talk to us, and get to know us at a distinctly different pace today.

I believe this is 2-year momentum. We are building on the 2-year base that Jeff originally recommended. It is an incredibly exciting time for us. And we no longer feel like a start-up. We feel like a confident collection of Weapons that know exactly how to handle whatever our clients need. Kind of like the A-Team, without Mr. T (aka B.A. Baracus, aka Mr. I Pity The Fool).

Key Takeaway

There is no one right way to go about launching a business. The key is to get moving. If you have been considering starting your own business, or making another significant change in your life, I encourage you to set your 2-year timer now, and start the process today.  Two years will give you plenty of time to go from that first step, to a confident swagger. Be persistent, be patient, and let’s talk about this again in two years.

5 ways for startups to win the cash flow game.

When you set out to start a new business people give you lots of encouragement, advice, warnings and worried looks. Even so, you don’t really know what lies ahead. You wonder what will be worse than expected, what will be easier than expected and what to expect when you are expecting (unless you already have that baby book).

Cash Money

A topic that everyone warned me about when I started my advertising and idea agency, The Weaponry, was cash flow. The basic issue is that you get paid for your work, and you have to pay bills, like salaries, rent and insurance. The problem is that you don’t always have an equal amount of money coming in as you have going out. Which means that you must have enough cash on hand to cover slow payments, slow months of work, or larger-than-usual expenses.

What I’ve learned

Cash flow challenges aren’t necessarily a result of a customer being delinquent in paying invoices. The challenges can simply be a matter of timing. Your projects, or deals, may take longer to complete, so it takes longer to bill, and thus longer to get paid. If you are delayed in sending out your invoices, that can funk up your cash flow too.

Avoid At All Costs

But regardless of the reason, running out of cash on hand is a common cause of death for businesses of all sizes. It is a lot like humans running out of oxygen, or blood. Which I’ve never done. But I know some people who have, and they wanted me to tell you to avoid it at all costs.

If you are thinking about starting a business, or already have a business and could use some advice, here are a few tips to keep the cash flowing and your business going.

5 Cash Flow Tips

Don’t quit your job until you absolutely have to.  A salaried job helps the cash flow in your startup in two ways. 1. It ensures that cash keeps coming into your world. 2. It decreases or eliminates the need to draw a salary from the business in order to pay yourself. This enables cash to build in your business. Like water behind a dam baby!

Start with more cash on hand than you think you need. Don’t start a business without a reserve. Inevitably you will need it. And if you can’t float an expense because you don’t have the cash around, you clients, suppliers, partners or employees will question your business-hood. And you don’t want your business-hood questioned.

Send your invoices as soon as the work is complete. Entrepreneurs have a lot of demand on their time. So it can be easy to let your invoicing slide while putting out fires and keeping plates spinning. But you have to keep your invoices flowing if you want cash to flow into your business. A good bookkeeper, aka God’s Gift To Entrepreneurs, and a repeatable invoicing process can help ensure that you don’t fall behind on this process.

Delay adding salaried employees until you have a 3-month runway.  We began The Weaponry with a freelance workforce. I wanted to be able to see 3 months of sustainable work ahead in each discipline before I committed to hiring a full-time, salaried employees for that role. The 3-month rule has been a very good guide for us. For other businesses the timing may vary.  Regardless, develop your own rule of thumb, and enforce it.

Keep 3 months worth of salary in reserve at all times. You never know when the demand for your product or service will go dormant. It doesn’t mean it won’t come back. But you have to be able to weather the winter in order to be around when the demand springs up again. Having the cash reserve on hand is like a squirrel storing nuts. A three-month reserve is good. A six-month reserve is better. A billion-month reserve is best.

Key Takeaway

Starting your own business is extremely rewarding. But to keep the rewards coming, you have to keep the cash flowing. It is important to understand that cash flow isn’t just a part of the entrepreneurial game. It is the game itself.

*To learn more of what I have learned through my entrepreneurial journey, please consider subscribing to this blog.

How do you measure your professional growth?

When I was a kid I loved being measured. It was a great way to track my growth. I loved standing against the wall and measuring my height to see how much I had grown since the last time I stood against a wall. But I have not grown a millimeter since I was 14 years old. I topped out at 6 feet and 1/4 inch. But I was thrilled to be 6-something and not 5-something. (No disrespect 5-Somethings. #heightgoals)

Weight

I used to love stepping on a scale to see how much weight I had gained too. While I didn’t get any taller after my freshman year, I did gain 65 pounds during high school. In the 20+ years since then I have never been more than 10 pounds above my graduation weight. But like most adults, I am no longer excited to see growth on the bathroom scale.

Taking New Measurements

Today I measure my growth in other ways. In 2016 I decided to undertake a personal growth challenge and start an advertising and idea agency. I knew this entrepreneurial adventure would push me to grow in a great number of ways. But when I first began my journey I’m not sure I could have identified those many areas of growth. Or perhaps more importantly, how I would recognize the growth when it occurred.  After all, there is no scale to step on to measure the size of you Entrepreneurium.

Last week I saw it.

Late last Wednesday afternoon I left my office and climbed into the driver’s seat of my car. I took a moment to reflect on my day. There, in the quiet of my car, I could measure my own growth as clearly as I could when I was a kid standing against the wall or stepping on the bathroom scale.

The New Growth

Here are a few things that happened that day that showed me how far I had come in my entrepreneurial journey.

  1. I went to my office at The Weaponry. What had started as a business idea in my head in 2016 is no longer just an idea in my head. It’s a real, physical space with walls, doors and windows. It’s located at 1661 N. Water Street, Suite, #206 in Milwaukee. Stop by when you have a moment.
  2. I spent an hour dealing with our employer-offered insurance. We now offer health and dental insurance to our full-time employees. I had to chase down information that morning to get our new group ID numbers. I then put on my HR Director hat and held an impromptu meeting to update our employees who have enrolled in our insurance. Then I distributed temporary ID cards. Even typing this feels like a big step forward. I will have a whole post on this process to share soon.
  3. I participated in my monthly CEO roundtable discussion. I meet with a group of six business owners on the second Wednesday of every month. This group is part of the Council of Small Business Executives (COSBE), organized by the Metro Milwaukee Association of Commerce (MMAC). I encourage you to click that link just to see how beautiful their picture of Milwaukee is. Milwaukee is a great city on a great lake. And I am thrilled to be here. But the discussions I participate in at these monthly meetings are a clear indicator of my professional growth over the past 18 months.
  4. I ended my day with a 45 minute discussion with our IT consultant. We are implementing upgrades to our IT infrastructure to meet the stringent security standards of the banking industry. There will be more to come on this in a future post. But when I stop and think about my expanded vocabulary in this space alone it is impossible not to recognize the growth. I’ve come a long way since I was a young copywriter penning headlines like, “It’s so responsive it knows which butt cheek you’re flexing.’  

Take Away

I don’t need a scale or measuring tape to document the growth spurt that I’m experiencing now. It is clearly evident in my daily actions, my language, and the growing circle of impressive people I spend my time with. This is exactly what I was after when I first experienced the urge for more growth, both personally and professionally. I know there is much I don’t yet know. But I am working on it. And that makes all the difference.

*To follow my journey please consider subscribing to this blog. If you’ve never subscribed to a blog before, consider this part of your personal growth. Yay you!