As mentioned in my earlier post, at any given time, I probably have several startup ideas floating around in my head that I’m seriously itching to explore. Because of this addiction to entrepreneurship, I’ve had to create personal mental filters to help me quickly decide which startup ideas to shove out of my mind space…and which to nurture and let it
One such mental filter I’ve been using a lot lately asks the simple question, “Do I really want to spend my nights and weekends geeking out on this problem for the next couple years?” When I consider this question, I really take a deep dive into picturing how life would look day-in and day-out if this business was a part of my life. How would life look when the business gets hard? Am I really going to enjoy investing $50k more into the business if the business is at risk of failing after a year? What are some of the daily mundane tasks I know I’ll be responsible for?…and how would I feel about those tasks after a year or two? My answer to these questions are often sobering.
For example, in my college years, my roommate worked at a hot dog cart part-time for minimum wage. It wasn’t a particularly popular hot dog stand…just a standard nondescript food cart located in a small outdoor strip-mall. Well, we did the math on it, and quickly realized that this small hot dog cart was pulling in around $80k a year, and the owner was running 5 of these carts, each likely making around the same revenue. His total revenue for running this small business was around $400k/year…not too shabby for such a simple business operation. The owner didn’t even actually work at these carts…he just set them up at the beginning of the day, and took them down at the end of the day.
We imagined he earned pretty good profits with a fairly simple, low risk, low investment operation…and the potential financials make this kind of venture somewhat tempting. But given the choice to operate a similar business myself, how would I really feel about managing a hot dog cart business after a year? Would waking up early, prepping hot dogs all morning, hauling the carts out to their locations, hauling the carts back at night for storage, cleanup, haggling with food vendors, managing minimum wage employees, etc…is this daily lifestyle worth the money? No offense to all hot dog cart vendors out there…I just couldn’t picture myself entrenched in all the daily tasks involved with a food cart business. It’d probably be fairly exciting the first few months, setting up and branding the business…but it’d likely lose its appeal for me relatively fast.
For me, the initial startup stage launching from ground zero is where most of the intrigue and excitement lies. Often, I need to remind myself that the new eventually becomes old…and I have to ask myself how I’d feel about this business after the initial excitement is over and the real work (aka, “the grind”) kicks in? Viewing a business realistically through this lens has definitely helped me filter out potentially unappealing projects.
As I’ve been using this filter for a couple months now, I’ve found it works pretty well for me. I also realized it made me ask a more fundamental question, namely what types of businesses would actually hold my interest through the long haul? What deeper cravings exist in my professional and personal life beyond the scope of just making money? I won’t get too far into the minutiae reasons of each type of business in this post…but I was surprised that I was able to quickly identify 3 main categories of businesses that I think I want as part of my life for the long term.
One type of business I can foresee always geeking out on is a SaaS (software as a service) business. I think in a way, my passion for technology will always keep me interested running a technology-centered company…and cloud-based software is definitely the sweet spot of my tech expertise and experience. It’s also pretty important to me that SaaS businesses are built on a recurring revenue model, and can typically be location independent…an attribute I greatly value in life.
The second type of business I’ve repeatedly craved throughout my life is selling physical products and creating a brand around it. I think being in software for so long, the idea of selling physical goods offers me some sanity that I’m not totally lost in a virtual world. Ironically, I think there’s something magical to the simplicity of selling someone an actual product in exchange for their hard earned cash. I might be romanticizing it a bit, but I imagine there’s some deeper satisfaction to be had in seeing someone use and enjoy your product in a tangible way.
The third type of business I’m less sure about, but it’s been a recurring thought in my head that I can’t shake. It’s the intrigue of running an event…namely a conference. Like the previous idea of owning a business around a physical product…I think I have some inner craving to build something that helps people connect in the physical world. I actually doubt how lucrative or smart it would be to pursue a conference business…but I definitely don’t underestimate my personal desire of being a catalyst for real world human connection.
If you’re still reading this post…kudos. It’s a long post simply to reveal that over the course of this blog…I’ll be journaling through these 3 major bootstrapping pursuits: building a SaaS business, a physical product business, and a conference.