#289: Elaine Pofeldt on Creating a High-Revenue Microbusiness

Welcome to the High Income Business Writing Podcast, helping you propel your writing business to a whole new level. And now, here's your host, Ed Gandia. Elaine, welcome back to the show. Great to have you here.

Thanks so much, Ed. Great to be back.

Yeah, it's really enjoyed our first conversation and I was really excited when I found out about your new book because this is definitely an area and a topic that I'm getting asked about more and more seeing some growing interest here. And so I think it's a very timely topic for my audience. So why don't we start with maybe just give the audience and those who don't know you haven't listened to our first episode together, a bit about what you do and maybe what kind of work, what kind of clients and you know, so that way folks understand where you're coming from.

Sure. Well, like a lot of the listeners, I am a writer. I've been a freelance writer for about 15 years and before that I was a staff editor, most recently at Fortune Small Business magazine where I was a senior editor and I ran the website. I was there for about eight years. I write mostly about entrepreneurship and careers. That's really been my specialty the last 15 years. And I'm very passionate about it and love it. I don't know exactly why I got hooked on it, but I think writers out there will relate to that you sort of subject. And I started out as a freelance journalist only. And what I realized, I started in October 2007 and as the Great Recession hit and a lot of the publications got hit, I realized I had to diversify and that writing was a valuable skill in any market. And I started doing content marketing to help companies that needed to bring on new customers to make it through the recession. During that period, I started doing ghostwriting for one of my clients who was an entrepreneur. And that led to, I don't want to say it's a side hustle, it's very integrated into my business, but a whole new line of work for me which was ghostwriting. Initially it was columns, blogs, that sort of thing. But then it morphed into doing books, which was a much higher paying type of writing that I had not done before. So now 15 years later, I expanded beyond that to doing my own books. And in the last few years I wrote two books. One was called Tiny. I'm sorry, the new one is Tiny Business, Big Money. This one just came out in February of 2022. And prior to that I did the million dollar one person business, which looked at solopreneurs who were making it to seven figure revenue and what were they doing that was different from of the solopreneurs that I knew who were working really hard but just not getting to those revenue levels.

And those are fascinating topics. I think we're at a point in history where that's actually very doable, which is crazy, isn't it?

I agree with you, Ed, and I think you found this sweet spot early. Writing is an extremely valuable skill in the environment that we're in, and it's only becoming more valuable. And the challenge for writers is thinking about themselves as business owners, because a lot of times we're motivated by passion for the writing. But if you have financial obligations, paying your mortgage, putting your kids through college, taking care of an elderly parent, if you can put your business hat on a little bit more while still enjoying the passion of writing, you really can do quite well for yourself.

Couldn't agree more. Let's talk about the term. You use a term, high revenue micro business. So just so everyone, and you've kind of alluded to some of this already, but just so we're all on the same page, what's your definition of that?

Generally it's a six figure business, but for the purposes of my books, I focused on the businesses that are at 1 million in annual revenue or more because I think that's a more aspirational number for most freelancers. A lot of solopreneurs can get to 200 or $300,000 by working really hard and building up experience and a name for themselves in their niche. But it's getting past that point that eludes most people. And these are less than 1%. If you're looking at solopreneurs, which I did in that first book, the million dollar one person business, it is less than 1%. But they're like the elite athletes we can all learn from. What are their best practices? How do they think differently about their work than we do? I have to say, a lot of them have great lifestyle. How do they do that? Well, having great lifestyle too, and having time to rest and enjoy their lives and spend time with family and friends, that to me is really fascinating. And I think it's almost the holy grail. And I never get tired of learning about what they're doing.

You know, it's quite interesting because I find that many of us start down this path just really just trying to make a living, right? We just want to be able to put food on the table and then it turns into, gosh, if I could just break Six figures. And then you do. And most people don't, but those who do very quickly start setting their, their sites a little bit higher. And then they're trying to maximize what they're earned. And then what tends to happen is burnout sets in. Because what you've done essentially is sold off your full capacity to work. This is creative work. This takes a lot out of you. I always joke that, you know, in a way, every time I deliver a project, it's like, I've sold a little piece of my soul. Maybe a little too dramatic, but there comes a point if your ambition, right, it's like, oh my gosh, it's like, I'm tired. But there comes a point where, you know, it's a combination of the burnout, no time. Now you're at the other extreme where at first you just try to eke a living. Now you're just, you're on the defensive. Like, you feel like you're being attacked, you have no time, you're making great money, and you've hit a ceiling. So I'd love to talk a little bit if maybe you can offer some ideas or examples of what this might look like for a writer who is already doing very, very well. But essentially they're maxed out in terms of their capacity. You know, what are maybe some different paths that someone could take if they're in that situation, in terms of ideas and different types of businesses that they might want to think about?

Well, one thing I would encourage anybody to do if they're in that situation, I work with a business coach named Doug Wick who mostly works with middle market companies, but we got to know each other because he's working on a book. He had me do a spreadsheet of how I spent every hour of the day for a few weeks. It's very interesting when you look at those numbers, you can see that sometimes you're investing your time in projects that really aren't advancing you towards any of your goals in terms of what you want to be writing about, your monetary goals, your goal of having peace and some time in your schedule so you can look at it and then decide, do I need to be doing these things? And sometimes you actually do, but you should be outsourcing them. Like maybe it's your bookkeeping or something that you're not particularly well trained in, that you're not doing efficiently. Or it could be you're taking on certain assignments that the client is so difficult that they wind up taking five times more time than you ever expected. When you when you accepted the contract. It's very helpful to become conscious. I think consciousness is the foundation of all of this. Then you can decide what you want to be doing and what you don't want to be doing. Now, I understand people have bills to pay too. So sometimes this is a slow moving process. It's not like, like you can just decide, okay, I'm cutting out all those clients who aren't really that efficient or profitable for me this week because you still have to pay your electric bill and your mortgage or your rent. But you can gradually transition over to the things that are more productive and profitable for you and that are more spiritually rewarding. Because you talked about your soul and it's true. When you're doing creative work and you're really bringing your best creative self, it comes from the core of yourself. Basically. You feel it almost in your gut when you're working on it. You don't want to give that away to projects that are not worthy of it because you only have so much of it. I think it does regenerate. But we all have our limitations. We're not just unlimited volcanoes of creativity every hour of the day. I think looking at some of the business models in tiny business Big money could be helpful for some writers. I'll give you an example. Brian Dean was a copywriter in New York City. Very much in that situation you're describing, where he had maxed out all his time. He was feeling burned out. He posted one article about search engine optimization that turned out to be his way out. It was just getting a lot of traffic and he was conscious of that. He paid attention to the fact that it was getting such a big audience and he started adding to it and expanding on it. And then he created a site called Backlinko which provided a lot of information about search engine optimization. Then he built a team. He built a course and he's a digital nomad. He's a younger guy and he was living in Berlin for a while. Now he's living in Portugal. And he outsources a lot to a team. He does not like to do meetings. So he manages the whole team on Notion, which is a tech platform if folks are not familiar with it. And he's created a beautiful seven figure business. It's a sustainable seven figure business, using only the skills you would have as a copywriter to build a great business. And I think the takeaway in his story is that we're all doing things that resonate at different levels with our audiences. If you pay attention to what you're doing that really resonates that might help you to figure out where you can create a higher revenue business without crushing yourself with overwork.

I agree. And it sounds like he found something that was, and this is something I want to touch on for sure a couple of times with you, that was somewhat accidental, but he paid attention. So what, what. Can you give us a couple of other examples of how people like us, creative professionals have just kind of stumbled into or come up with an idea that they then turned into a high revenue micro business?

Sure. Well, another copywriter who has a great story is Dana Derricks. He lives on a goat farm in Wisconsin and he's also a copywriter. And he started writing books about copywriting to assist his clients in implementing what he was saying, because sometimes they'd outsource some of the work to him and they take some of it in house. We're all familiar with that model. Maybe they don't have the budget. But what he realized was the value of what he was sharing was far more than the price of a book. A book might be 20, $25. So he started experimenting with pricing and he started selling high ticket books. The first one was $400 and he would sell it to his clients. And he sold, I believe it was several thousand of those books. And then he started raising the price to over $1,000. And it seemed like the price, once he got to over $1,000, it fell off. But that enabled him to really monetize what he knew and not have to work as much. And he kind of went back and forth. He actually got to the point of hiring employees, but then he found that was too restrictive. He didn't want the responsibility of that. So then he switched back to contractors. And. And he's got a great lifestyle. He loves living in the country. He loves taking care of goats and that whole agricultural lifestyle. And he's able to have what he wants, which is really nice. Another entrepreneur who's in the book, Laura Belgray, you may have come across her work. She's a really talented copywriter. She was charging $1,450 an hour for her work. But as you pointed out in the beginning, Ed, it was really stressful. When someone is paying you that kind of money to perform for an hour, you better bring your best game.

First of all, they shouldn't be charging by the hour. But that's a different. That's another episode.

Well, she got out of that. She actually got a business coach and she did want to get out of it, but she didn't know how. She lived in New York City, high cost of living, etc. And what he noticed was she had developed these two PDF courses. And you probably see a little theme here with the courses. She wasn't really monetizing them. She had them on her website. She had had a designer make them look pretty, she calls it, nicing them up. And she wasn't marketing them much. So he said, well, why don't you send out your email newsletter three times a week and mention these courses. And they were like, I think $150 each, not that much money. And she started heavily promoting them. And that is actually what got her to seven figures. She also introduced a mastermind where she would talk about copywriting and she had it open to people that weren't necessarily professionals in copywriting. It was a whole host of different industries, so that it was a really interesting chemistry in the group. And that was a higher ticket cost of membership as well. And it was in combination that she was able to leverage what she knew about copy editing and to build her seven figure business. What I think are the important themes here is the person wasn't just making the money from assignments. I mean, the assignments are what teaches you the craft and that helps you build the relationships in the industry that you need to grow a business. But if you stop there, you really will only stay in the six figures. And I don't want to say only because that's an accomplishment to get there. A lot of people never can. But if your aspiration is to get a little bit beyond that, then you need to think about productizing or some sort of a higher ticket experience based on what I saw with interviewing these entrepreneurs and writers.

Yeah. So essentially, instead of selling your skill or even your insights directly, you're leveraging your expertise in a different way. You're packaging it, productizing it in selling it. And that is very much scalable because you don't have to perform every single time. It's a digital product or it's something that doesn't take that much to produce, yet you've already put in the time to create it. And it's all mostly profit, which is a beautiful thing.

Oh, it's true. And when you think about it, for folks like us, we're writers, so this is what comes naturally to us. And some of this we can do in our sleep because we've been doing it for so many years. We just are one with our field. We just sit down and write all the time. But for people that don't write all the time and are learning the craft. Maybe they're younger people in the field or new career changers or people that are reasonably proficient. Maybe they're in the marketing department of a company, but they'd like to get better. They will benefit a lot from what we have to teach and they don't know it. Similar to if we go to our accountant. Maybe we don't really know things that are really easy for them and we're willing to pay for it because it's so valuable to us to make sure that our books are in order and we're not in trouble with the IRS and all that stuff. Part of this is recognizing the value of what you know and recognizing that other people don't necessarily know it and they do value it and they do respect it and they are willing to pay for it.

So a lot of these examples have been of writers and copywriters who basically sold their, their, their knowledge. Right. But have you come across, and I'm sure you did in some of these interviews, people who started something completely different, either based on a hobby, a personal hobby, or, you know, a product based business or anything completely different that didn't involve selling what, what they knew best in their writing business?

Well, one example, she's not a writer, she's a photographer. But it's a similar type of. Yeah, Jenna Kutcher is a photographer. She had actually been working at Target and she was up for a promotion and she realized she didn't want to live the corporate life and she was a talented amateur photographer. She started doing wedding photography and she had a real vision for it and built her practice really quickly. And then she started a course. So this is an example. She started teaching photography in the course which was within her discipline and then she started an Instagram feed where she put up. She was trying to have a baby, then she had a baby and it was a lot about family life and pictures of herself and her husband. She lives in Minnesota and you know, a lot of the outdoor things that they did and it was very candid, she'd have a heartfelt vignette on every post. And she built a huge following on Instagram and became an influencer. And now she gets $10,000 for every ad on the Instagram feed and she's well above 1 million and I think she has 7 full time employees now. She's created a lot of jobs for at home moms in her community and built a really beautiful engine for doing good through her business. I think she's Pretty inspiring, because I think there are a lot of writers who potentially could become influencers in something else. You know, she's really. Her business is photography, but really what she's writing about is family life on the Instagram feed, and she is an expert in family life as a mother, as, you know, anybody would be who has a family. But that's the kind of thing to think about, is maybe you do have some other interests in your life or other experiences that you're immersed in where you can bring value. I mean, the key is that you actually are interested in talking about it and you can bring value. I have four children myself. I don't want to be a parenting influencer. I like to just keep that separate from work. Other people, their work and life is blended in that area. So it's a matter of thinking about which things you actually would like to turn into a business and which things you'd like to keep separate.

And just to be clear, so how is she monetizing this? So she is writing and posting on Instagram, and because of the number, she's. It's the ads.

It's the ads. Yeah. Because she gets $10,000 per ad and she posts every day. So, yeah, that's how she grew the business. The courses still make money, too. She's got a podcast. She's actually got two. The main one is the goal. It's called the Goal G O A L Digger podcast, which is inspiring for people who have entrepreneurial dreams. And that is an engine for driving attention to all the other things that she's doing.

Interesting. In discussions with founders, what percentage would you say of folks found something accidentally or just kind of happened and then they paid attention and then decided to grow it, versus those who took a much more scientific approach, starting with brainstorming and then scientific testing and so on and so forth?

You know, I think there's some blending between those two categories. I'll give you an example. In the opening chapter of Tiny Business, Big Money, Chris Mead was a. He's not a writer. He was a salesperson for Uber Eats. He worked in New York City, and all he did all day was Cold Call. And he didn't want to keep doing it, but he had a lot of student loans and he had to pay them. He did know he wanted to start a business, and one day he was with his brother and a friend of theirs. They were watching sports, and the volleyball highlights came on, and kind of in the back of his mind, knowing that he wanted to start a business, he said, wouldn't it be awesome if we created a four way volleyball game, kind of like foursquare and made that into a business. So they were kind of actively brainstorming, but it was kind of accidental too that they happened to be watching the sports game at that time and you know, and so then they went out to Walmart and they got two volleyball nets and they experimented with the game and then they created a prototype. One of the friend actually had some experience in that, using a factory they found on Alibaba and the rest, you know, it was like a normal entrepreneurial trajectory in terms of getting it into stores, getting it onto Amazon, etc. A lot of people kind of stumble onto it. Kathy Guggenauer is a virtual assistant teacher. She actually worked in marketing.

I know Kathy.

Yeah. Oh, you know Kathy, she worked at telecom and she told this incredible story that I will never forget. She was trying to get ahead and she asked her boss what it would take to get a promotion and he said, well, you have to get an mba. I can't promote you without an mba. So she went out at night, weekends, got the MBA while working full time. And then she came back a couple of years later and she said, well, I've gotten the MBA and I'd like to ask for a promotion. And. And he said, well, you're not going to get it because the real reason I didn't promote you is you laugh and smile too much.

Oh my gosh. Really?

This was in the 90s, so I suspect there was some sexism and other things at work. It was a hard time for a lot of women in corporate to get ahead and she just decided to leave. And first she started selling candles, doing direct sales and she didn't like that. And, and then she realized, well, she had this writing talent and she began doing some blogging for a local realtor that she had been working with. And he told her other realtors could use this too because it was when blogging was starting to take off. And then she soon had more work than she could handle because she was good. So she started bringing in contractors to help her. She had about five contractors working for her and then she wound up selling that business and she started another business teaching these folks to run a practice. She called it virtual assistant, but they're kind of like blogging assistants, how to run the business side because a lot of them didn't know how to set limits with clients and you know, the business stuff like bookkeeping and all that. And then she started creating masterminds and some of Them cost more than $10,000 a year and they kept paying for them. So apparently they help. And some of the same people would come back for more and sign up for the other programs. And that was a little bit of a pivot for her. She's now gone out completely, left behind the writing part of it for the most part, and is now really a teacher of other people who are practitioners. She did write a book about this recently, how to Grow the Virtual Assistant Practice. So she does have a productized version of this. But the real money in that business comes in through her mastermind. So she would be an example of what you're talking about.

Yeah, I think it's. I agree that it's a combination. I think you have to put the intention out there. That definitely helps. And when you put it out there, my experience has been that you start noticing things that you didn't notice before and many of those aren't going to be it. But it just kind of opens up this gate of possibilities and that you may not have seen before. Because I do know some people who I want to start a business.

Talking about.

Yeah, I think it's. I agree that it's a combination. I think that's their intention. But it becomes kind of this anxiety ridden approach to the whole thing and they get really frustrated and they go about it, I think, in a kind of, in a, I don't know, kind of an anxious and nervous way in. To me, that's not opening up that creative flow of ideas. To me that feels a little bit too limiting in a way. Right. And I know some people have tried that and succeeded, but to me it's all about, hey, you don't know where the idea is going to come from, so just be kind of open to where it will come from.

I think you're right about that. It's being curious about your own life. And I think we're always on deadline and kind of in survival mode as writers. So it's hard to slow down long enough to say, hey, that article I wrote went viral, or hey, that client was really dazzled by that white paper that I wrote. Really dazzled. Maybe there's something more to that. Or this person wants to hire me to do this thing that I never thought of doing and they're willing to pay me a lot of money to do it. Maybe there's something there. When a business comes from that, it often really takes off when you say, okay, I'm going to start a business, I'm getting a new desk, I'm Getting a new laptop, I'm going to rent a space in a co working facility, blah blah, blah. Those businesses seem to never take off. It's like on the day after New Year's you go out for a walk or a run or whatever and you see all the people in their new sweatsuits out and they're looking at their watch as they're running, you know, and then you know you're never going to see them two weeks from now. And it's. It just seems to be that people get caught up in the trappings of something and what they think it should be. But when you're actually just trying to serve like someone has a need and you can serve it really well, that's the spirit of a business that really succeeds.

To me, I'd like to just kind of shift gears a little bit and talk about you got the idea. How can you test the idea while limiting your risk? Because obviously you don't want to go full bore necessarily, but you do want to see if this is a viable business opportunity.

One advantage that writers have, Ed, is that we do get traffic figures on our work if we're doing any sort of public facing work. So that's one way to take the risk out of things. For instance, if you were thinking of writing a book and you put out some blogs or articles on the topic and no one's really reading them, and you try to promote them on your social media and no one's still reading them, then maybe something isn't quite right with the idea or the market isn't ready for it, or maybe there's something else out there that already addressed this. It's listening to those cues. And I'm not saying traffic is the only thing because clickbait and all that, right? You don't want to just go buy what gets the most traffic. If you're thinking about a product, you can do small tests with it. One thing that one of the entrepreneurs told me about, Jason Vandergrand, he's an engineer and he's based in Toronto and he runs a business that does CAD design. CAD. And he has about 40 contractors around the world. But he's kind of a serial entrepreneur and what he told me was to rein himself in. If he has an idea, he gets a GoDaddy website for one month for $30 and he'll put up prototype on there. As a writer, maybe you'd put up the copy for the idea rather than a prototype. And then he takes out a Facebook ad to drive traffic to it and he sees if anybody expresses interest. If they don't, he doesn't go ahead with the idea. He had a bad experience, and not a bad experience, a learning experience where he loves designer sunglasses. And he spent $29,000 creating an app to locate the best deals on designer sunglasses. The first day he put it up, he realized there was a ton of competition in the space and it wasn't worth it. He would never turn a profit. So he just closed it down and he never wanted that to happen again.

Oh, gosh. Yeah.

So the testing is valuable. Another entrepreneur. Her name is Anna Gavia. She was a med student in Australia, and as a sidelight, she loved design. And she started sketching fashions like dresses and bikinis. And she only had $200 to invest in her business being a student. And so she found a manufacturer who could make a prototype on Alibaba again, and she put it up on her Instagram feed. And then she also took out Facebook ads to see if anyone would place pre orders. And then when she got 1000 pre orders, she knew she was onto something. And then she ordered using the pre order money. She paid the factory to do a small run. So there might be some ways to do that too. Like say you created an e book being a student, and so she found a manufacturer who could make or something like that. You could put, you know, maybe do a mini version of it and see if anybody's willing to pay for that. Or, you know, of course you could. You could take a similar approach, see if anyone's willing to pay up front before you start developing the whole thing. Then, of course, you really do have to develop it if you haven't done it. But it takes some of the risk out of it. Right? Because if no one's really interested or you're overpricing it, or there's just something wrong with the offering, it's better to find out before you put all the time into it.

Oh, totally. And I would add that it's not just at the beginning, it's even when you're growing. So many of the new courses and programs that I create, that's how they're done. I sell the tickets, gets first, you know, and then I create the show, if you will. And I will admit there are experiments, and there have been many times where it was really, really close. And there have been some times where I've even had to refund the few people who bought because it just wasn't going to be viable. But, you know, at least I didn't invest in Creating the whole program. I use that as a testing ground. So I don't think that ever ends. You know, that's, that's a. I love that idea because I that it works. You mentioned a little bit about finding the cash to fund your venture. I'd like to talk a little bit about the cash, but not too much. The one I'm really interested in is finding or making the time. But let's address cash first because if we're talking about an idea that might require a little bit of startup capital and you don't have it, what have you found people doing out there? How have they gotten creative with that?

Well, you just talked about an important one which is customer financing Ed, and that's, you know, the pre orders you can use crowdfunding. A lot of people that are good writers are also very good crowdfunders. One couple that I wrote about in the book, Vanessa Jeswani and Kish Vasnani, they're a married couple. She was a marketer and she started an Etsy store. They both wanted to get out of corporate and she started selling different accessories and what took off were these financing Ed. And that's, you know, the pre orders you can use crowdfunding. A lot of people that are good writers are also very good crowdfunders. One couple that I wrote about in the book, Vanessa Jeswani and Kish Vasnani, they're a married couple. She was a marketer, anvil pouches that she started designing and then Kish got fired from his sales job. He had like a Silicon Valley venture funded job. You know, he didn't make his numbers but he wanted to get out anyway. So they both started working on this business called Nomad Lane which makes travel bags and they, they crowdfunded it. But she told me a lot and there's some, a lot more detail in the book. But basically she built the audience for the crowdfunding campaign well in advance of the campaign, you know, building up her social media so when they announced it, people would be excited about it and actually pre order the bags. And she one technique. She and she started an Etsy store. They both wanted to get out of corporate and she started selling different accessories and what took off were these travel pouches that she started designing. And then Kish got fired from his sales job. He had like a Silicon Valley venture funded job. You know, she sent a calendar invite for the day of the crowdfunding because there's a certain SEO within these crowdfunding sites. She used Indiegogo and when she sent it out and people placed the pre orders and Indiegogo's internal team noticed that it was rising up and started turning. He didn't make his numbers, but he wanted to get out anyway. So they both started working on this business called Nomad Lane, which makes travel bags. And they. They crowdfunded it. But she told me a lot, and there's some. A lot more detail on the juice, which then helped it even more. And they raised 2.1 million in the book. But basically, she built the audience for the crowdfunding campaign. Well, in advance. Dollars for the bags. Yeah, yeah. And I thought, wow, the power of marketing skills. Because as a reporter, I've reported on some crowdfunding campaigns where the people heads of the campaign, you know, building up her social media. So when they announced it, people had restarted because they didn't realize all the legwork ahead of time. But this is something. We're such good communicators, and we build relationships. Well, I mean, anyone who's a freelance writer, you have to be good at relationships. So those are strengths in terms of crowdfunding. And then what happened was during the pandemic, the bags were for travel, so that the sales fell off. They made $1 million the first three months of 2020. Then they basically made no money the whole rest of the year. They started a zoom call with all the travelers who were buying the bags and just talking about travel and that sort of thing. And they got the idea from those folks to create a new bag which would be similar to the other one, which had tons of pockets to organize everything but for daily life outside of travel. And then they also funded that one on Indiegogo. And then travel came back again. So now they have the two bags. And I thought, what a great example of using the skills that you have to build a really viable business and find the funding. There's a lot of grant funding out there. Now. This is one area that I love because for years and years, I've been writing about entrepreneurship forever. People would ask me, is there a grant for starting a small business? I say, no. Basically there's the SBIR grants for scientific types that the government puts out, but nothing really. Now because of the pandemic, there were a lot of grants that started that are continuing for different demographics that were hit really hard by the pandemic. It could be regional. It could be for women or people of color. There are a lot of them still out there. And you don't have to pay the money back. You do have to be accountable for how you use it in the business and keep good books. But that's really nice to not have debt on your books. The other thing I would say is protecting your credit is really important and financial literacy is really important for freelance writers. And sometimes it's hard to do that because people pay you late and it's an occupational hazard. But I think you have to learn cash flow in any self employed situation and understand that that's the reality of the business. There's always going to be certain clients that pay you late. It's just life. And you have to live your life accordingly. Live a little bit below your means, maybe live in a little smaller house than you can afford or not go on as many vacations so you have some cash in the bank to protect you from that. Because then you will have a better credit score if you pay all your bills on time. And then that gives you access to other types of funding that you might need. Maybe you're doing a course and you do need to borrow some money on a credit card, but you're doing it at zero percent interest because you've protected your credit score all along and then you pay it back as soon as you have the money from the course. You can do things like that if you are financially literate. And I know sometimes as writers it's not our favorite thing, but that is the number one thing you can do for yourself in terms of your overall mental wellness as a freelancer.

I couldn't agree more.

Yeah, just protecting that and not getting sucked in by what you see your corporate friends doing who have their paycheck coming every two weeks. Because once you enter this world, you're living in a different realm of the people who eat what they kill. And you really have to make different financial decisions. You cannot count on the paycheck coming next week.

I think a couple of things that I have found very helpful that if I could call my past self, I would do and I would relay this information. One is have a little bit of working capital like you said, right. To cover that gap. I mean, if it has to be on a credit card, great, that's fine. But even better is if you have a little bit of money you can use to close that gap. And the second would be, I'm going to do a little plug here for profit first. The book Profit first by Mike Michalowicz. If I could have started. I know, I think you and Mike, well, I don't think you live in the same state. I think you guys have even Talked a little bit. Correct.

I actually don't know him. I'm a big fan of his work. But yes, his work is out there all the time and I'm a big fan. Actually a number of the million dollar one person businesses are users of that system. And it's great.

It's awesome, really. It's a combination of the envelope system and the pay yourself first philosophy. And if I could have. The book wasn't around when I started my. But if I could have started my business with the systems in that book and if I would have implemented those ideas, my gosh, I just wonder where I'd be right now. So just a couple of ideas there. Let's shift a little bit in the time because I actually think this is probably even the most difficult one. In my experience, my coaching clients, they think that this is not going to be the issue and ends up becoming the issue. How do you make the time to build and grow your business when you are already just kind of maxed out with your time capacity working for clients?

What I've seen from the entrepreneurs in the two books is they use a few different strategies to give themselves the time to think about research and development and growth and not just churning out the next assignment. They use automation. One entrepreneur, his name is Rajesh Srivasaba, he worked in big tech, he's an engineer and he started Price Series which publishes specialized reports for investors. It's very deep into the investing world. I can't even explain what the reports do, but he's done well with it. It's a million dollar one person business and he automated a lot of the business in terms of the payments he uses. PayPal would be excited about it and actually pre order the bags. One technique she used was she sent a calendar invite for the day of the crowdfunding because there's a certain SEO within these crowdfunding sites. She used Indiegogo and when she sent it out and people placed the pre orders and Indiegogo's internal team noticed that it was rising up and then turning on the juice, which then helped it even more. And they raised $2.1 million for the bags. Yeah, yeah. And I thought, wow, the power of marketing skills. Because as a reporter I've reported on some crowdfunding campaigns where the people had to restart it because they didn't realize all the legwork ahead of time. But this is something, we're such good communicators and we build relationships. Well, I mean anyone who's a freelance writer, you have to be good at Relationships. So those are strengths in terms of crowdfunding. And then what happened was during the pandemic, the bags were for travel, so that the sales fell off. They made $1 million the first three months of 2020. Then they basically made no money the whole rest of the year. So they started a zoom call with all the travelers who were buying the bags and just talking about travel and that sort of thing. And they got the idea from those folks to create a new bag which would be similar to the other one, which had tons of pockets to organize everything but for daily life outside of travel. And then they also funded that one on Indiegogo. And then travel came back again. So now they have the two bags. And I thought, what a great example of using the skills that you have to build a really viable business and find the funding. There's a lot of grant funding out there now. This is one, one area that I love because for years and years I've been writing about entrepreneurship forever. People would ask me, is there a grant for starting a small business? And I say no. Basically there's the SBIR grants for scientific types that the government puts out, but nothing really now because of the pandemic. There were a lot of grants that started that are continuing for different demographics that were hit really hard by the pandemic. It could be regional, it could be for women or people of color. And there are a lot of them still out there. And you don't have to pay the money back. You do have to be accountable for how you use it in the business and keep good books. But that's really nice to not have debt on your books. The other thing I would say is protecting your credit is really important and financial literacy is really important for freelance writers. And sometimes it's hard to do that because people pay you late and you know, it's an occupational hazard. But I think you have to learn cash flow in any self employed situation and understand that that's the reality of the business. There's always going to be certain clients that pay you late. It's just life. And you have to live your life accordingly. You know, live a little bit below your means, maybe live in a little smaller house than you can afford, or you know, not go on as many vacations. So you have some cash in the bank to protect you from that because then you will have a better credit score if you pay all your bills on time. And then that gives you access to other types of funding that you might need. Like maybe you're doing a course and you do need to borrow some money on a credit card, but you're doing it at zero percent interest because you've protected your credit score all along and then you pay it back as soon as you have the money from the course. You can do things like that if you are financially literate. And I know sometimes as writers it's not our favorite thing, but that is the number one thing you can do for yourself in terms of your overall mental wellness as a freelancer.

I couldn't agree more.

Yeah, just protecting that and not getting sucked in by what you see your corporate friends doing who have their paycheck coming every two weeks. Because once you enter this world, you're living in a different realm of the people who eat what they kill. And you really have to make different financial decisions. You cannot count on the paycheck coming next week.

You know, if I think a couple of things that I have found very helpful that if I could, if I could call my past self, I would do and I would relay this information. One is have a little bit of working capital like you said, right. To cover that gap. I mean if it has to be on a credit card, great, that's fine. But even better is if you have a little bit of money you can use to close that gap. And the second would be. I'm going to do a little plug here for profit first. The book Profit first by Mike Michalowicz. If I could have started. Right. I know. I think you and Mike. Well, I don't think you live in the same state. I think you guys have even. And talked a little bit. Correct.

I actually don't know him. I'm a big work. But I. But yes, his work is out there all the time. And I'm a big fan. Actually a number of the million dollar one person businesses are users of that system. And it's great.

It's awesome. Really. It's a combination of the envelope system and the pay yourself first philosophy. And if I could have. The book wasn't around when I started my business, but if I could have started my business with. With the systems in that book and if I would have implemented those ideas, my gosh, I just wonder where I'd be right now. So just a couple of ideas there. Let's shift a little bit in the time because I actually think this is probably even the most difficult one. In my experience, my coaching clients, they think that this is not going to be the issue and ends up becoming the issue. How do you make the time to build and grow your business when you are already just kind of maxed out with your time capacity working for clients.

What I've seen from the entrepreneurs in the two books is they use a few different strategies to give themselves the time to think about research and development and growth and not just churning out the next assignment. They use automation. One entrepreneur, his name is Rajesh Srivasava. He worked in big tech, he's an engineer and he started Price Series which publishes specialized reports for investors. It's very deep into the investing world. I can't even explain what the reports do, but he's done well with it. It's a million dollar one person business and he automated a lot of the business in terms of the payments. He uses PayPal because they have really good cybersecurity. This the actual transaction, you know, to download the reports and things. He, he updates the. The leader of an army of one. You just shouldn't be doing them. I had to realize this with bookkeeping. I remember a few years ago I was doing my QuickBooks and I never really could get it to balance because I never took the time to learn double entry accounting. And it was this beautiful Saturday, I think it was like in April, and my kids wanted to go out and I had to spend the whole weekend getting my books caught up. And I was so mad at myself for wasting that beautiful weekend knowing that I can't get back that time with my kids that I finally. I was venting about this to one of the podcasters and he told me he used bench accounting. And bench doesn't give me any money or anything for saying this. And there are competitors. They have an automated system where you upload all your reports, like your credit card statements, your bank statements. They actually pull it in using AI and then they do have a bookkeeper and that person is available if you have questions. But they do everything so nicely. It's about $200 a month. It's so worth it because I never have to worry about it anymore except for uploading some documents if the connections break. So that's the other thing is thinking about these things that like they're taking up your time. You resent doing them. You're not really that good at them. You don't want to take the time to learn them. We all have things like that in a business because it requires so many different things, skills. It could be for some people like you just don't like doing your own social media. I started having my kids work in my business and they're older teenagers and I have them work on some of the social media stuff. And they're better at it than me, you know, and I supervise everything. There's nothing that goes into my feeds that I didn't sign off on. But they can do things like post the pictures and, you know, that sort of thing. So think about those things. And then you may need to go to hiring employees at a certain point. And a lot of times this is a compliance issue. For instance, if you have a virtual assistant, depends on where they're located. If they're in the United States and you control when and where they work and exactly how they have to do their work, they may have to be an employee. Now you can hire them through an agency where they're the employer at that agency. Some people prefer to hire contractors and they hire them in countries like the Philippines, where it's a little bit different. There's a lot of different ways to do this. The important thing is to make sure you're doing it properly because you don't want to get hit with tax penalties and things because you did it wrong. It's worth getting legal advice on that. But if you need permanent help, you should get it because otherwise you can't grow the business. And it's hard because our egos get in the way. I think a lot of solopreneurs, we think we can handle everything. We do have that independent spirit. But sometimes you have to say, look, it's better if someone else just does this. And it's better if I have someone managing my calendar. You know, even if I have calendly or schedule ones, I'm still there still needs to be someone dealing with the things that fall through the cracks. And once you do that, it's very freeing.

I have found that. I couldn't agree more, Elaine. It's, you know, get help. And this is why, you know, I think it's, it's, you should have a little bit of working capital.

You should be working website for better SEO by putting this report every day on the homepage, which is also automated. And so it's a fully automated business basically. And, you know, he's involved with it, but. But he doesn't do a lot of the daily work of it. So that's one thing for most writers, they're not going to have his tech skills, but you can hire people to set these things up for you. Upwork and people per hour and freelancer are filled with, with specialized freelancers who can help you with these types of things. So that's one thing you can do using contractors. I know You're a big fan of this, Ed, and so am I. There are a lot of things that you just shouldn't be doing as the leader of your business, even if you're.

Willing to invest a little bit. Sometimes one of the downsides of having a writing business is that it took so little to nothing to start it that you create this expectation that everything is going to be like this.

That.

And it's not. Sometimes you do have to have a little bit of startup capital. I have found that a va, the right va, can actually fill three or four or more gaps in what in your business, meaning like a WordPress website, the email newsletter, the e commerce stuff. So you can very often find a VA who can fill a lot of different roles. There's a limit to this. But where you don't have to have, okay, I need a coder, and then I need this person. I need this person. That's overwhelming. If we're starting out, my advice would be, and this is who I found somebody who could fill several of these different key roles at the beginning. And the other thing that I have found, Elaine, is for me, I had to schedule specific time slots to work on this business, because if I didn't and if I didn't treat those time slots like a doctor's appointment, I would just plow right through them and say, oh, I don't have time, you know, So I. To me, that was really key. Now here's the interesting part. I don't know if you interviewed anyone who had this problem once you get a taste for it. So once you start generating some sales, then suddenly the whole thing shifts. Then you don't want to work your original business, and all you want to do is work this business that's just barely bringing in revenue right now. So you got to be careful. You have to have some internal boundaries there so you don't get carried away and have your core business suddenly fall apart.

That is so true. You know, there are a lot of balls to keep in the air, and it really helps have someone helping you because otherwise you can't deliver the quality to your clients that you need to deliver.

Totally, totally, totally. All right, so as we wrap up, tell us again about your new book and where people can learn more about it and where they can learn more about your work.

The new book, Tiny Business, Big Money, looks at businesses that have small teams. Either they have contractors that are recurring contractors, or they have employees. And they can find out more about it@tinybusiness, big money.com or it's on Amazon as well. What it really looks at is the steps it takes to scale. And so I look at the different combinations of help that entrepreneurs are using, and many of them are relevant for writers. There's the automation model, like Rajesh that I mentioned earlier, and then this automation plus contractors, automation plus employees, and so on. And sometimes it involves partnerships too. I think many of us have partnered with other writers, for instance, where that can help you grow your business, where each of you maybe has some bigger projects that you bring in that you can't handle yourself. So that's another way to build the value of your business going forward. So there's a lot of case studies. I interviewed almost 60 entrepreneurs and they shared a lot of their secret sauce and a lot of the apps and tools that they use. But. But growing a business isn't about using the right apps and tools. Ultimately, it's a way of thinking. It's an entrepreneurial way of thinking. It's letting go of the employee mindset. And there's a lot about mindset in the book. It's really owning your own career. And that's something we're not really taught in school. We're taught to let authority figures tell us what the next steps are. From the point we apply to colleges till we're applying to jobs and so on. You have to really let go of that in your own business. You are the authority on your own career and you are the gatekeeper. I mean, you may have to pitch clients and get past certain people in order to get in the door, but it's up to you to steer the ship and to be a leader. I didn't really realize that, that even as a freelance writer, you have to be a leader of yourself. And that's a different mindset. Even if you're not like a gung hobby Jack Welch type, you know, it's really important and that's very freeing. I mean, I could see you're doing that in your business with all the entrepreneurial things you do, but it's a departure. The other thing is to realize that you're not always going to be prepared for the opportunities in front of you if you do work for big corporate clients. We've all had this experience. Anyone who does, where just to pitch an idea, you've got to go in with a PowerPoint and they're like, like 16 people on the call and they have to approve it and it's got to go through compliance. And it's, you know, it's an 800 word article. And by the end. 40 people have touched it. It probably cost them $20,000 to produce. It's not like that. As a freelancer, you know, you. If you happen to run into the right person and they need help with, you know, ghostwriting their book, maybe the whole sales pitch is that conversation that you have where you're not even pitching, but you're just ready to discuss what you can do well for them. And if that a good fit, it's a whole different ball game. And it's being open. I think you touched on that in the beginning, Ed. It's just an openness to what the universe is telling you about your talents and your business, the positive things, because everybody gets negative feedback and rejection. Not letting that get into your head because all of these things are subjective. But leaning into the client and the projects that really appreciate and nurture your natural talents.

I think it's a muscle, Elaine, that you develop. And the good thing is, you know, for writers at least, we've taken those first few steps to develop that muscle that many people in traditional jobs haven't done. But you're right, this is a different level at this point. And you do have to shift your thinking, your mindset in order to do well. I'm glad you talked about that because I think that is, to me, that is foundational. And without that, it's going to be very difficult to succeed. And sometimes you learn that mindset along the way. Sometimes you kind of develop it before you get there, but either way, there's no skipping it. So very well said. And, guys, I encourage you to grab the book. If anything, not only will you get concrete ideas, but to me, just reading these case studies, these specific examples that feeds your mental database of ideas that will help you connect dots and I think, see opportunities more clearly when they present themselves to you in life. So, Elaine, thank you so much for coming in today. I just always enjoy talking with you and this has been super, super informational and inspirational.

Thank you so much for having me. And I feel the same. I really appreciate that all that you do for the writing community and helping people to live their whole life as a writer independently is what a tremendous gift that you're giving to people. So thank you for all that you do.

Thank you. Well, that's it for today. I hope you enjoyed the episode. And just a quick reminder to grab your free copy of my latest book, Burn More in Less Time. The Proven Mindset Strategies and Actions to Prosper as a Freelance writer. You can get your free copy@b2b. Launcher.com or you will also find the detailed show notes to this and all my other episodes. Enjoy and have a great day.