013 The 7 Key Factors For Starting And Running An Online Business

By Tom Birchall | Podcast

Sep 01

More...

Episode Highlights: 

The critical elements of a profitable online business are no longer a mystery. Tom shares the 7 Key Factors For Starting And Running An Online Business.

Subscribe and Download:

Listen to Tom Birchall on the go! Rate and review. Follow The Profitable Maverick Podcast using your favorite app:

Episode Transcript:

There’s a stat out there that’s pretty common that people talk about and it is that 80% of businesses fail within the first two years.

1:09
Do you wonder why entrepreneurs fail? Do you wonder why you are so busy and run off your feet? The bigger question is do you actually want to change that?

1:23
We are talking about entrepreneurs trap number two. The number one trap I talked about in episode number one, and that was creativity. And today I’m going to talk about why entrepreneurs fail. And let’s change that statistic.

1:35
There’s a stat out there that’s pretty common that people talk about and it is that 80% of businesses fail within the first two years. Now if you look at some of those numbers (let’s say there’s 100 entrepreneurs just for easy math and working with percentages) let’s say 100 entrepreneurs start out, and that statistic proves out that then two years, 80% of them are gone and there’s only 20 left. Let’s apply this statistic again to the next two years, and take that new sample size of 20 people that are still successful after year two, and they move into year three and four and they go for two more years.

2:12
Well, if we apply that statistic again. 80% of those are going to fail and only 20% are going to survive. Well, what is that? That’s 16 businesses, that’s the 80% failed, and only four businesses are left. Well, in the four year period let’s add this up. 96% of businesses have failed, and only 4 are going. Wow! Yikes! Let that not be you!

2:40
So, what is it that is causing this failure rate? And in Episode Number one, back when we started in the launch the podcast. I talked about the entrepreneurial trap of creativity. You can go back and listen to that there. And today I’m going to talk about the systems trap.

2:56
There’s another trap it’s a big trap a big old trap. It’s like what they trap foxes or coyotes or bears or something in. Right those big jaws they clamp and grab on to you. Let that not be you.

3:10
We’re going to talk about how to make business easier. #BusinessMadeEasy. And one of the ways of doing that is to implement systems. And some folks are resistant to it, they feel it takes away their freedom. But here’s the irony: Systems and structure, give you freedom.

3:27
Hopefully you’ve heard that before. And in today’s episode I’m going to break this down and get real granular and specific and practical. And make this stuff easy and not complex and convoluted but simple so that you are able to move forward and embrace this. On how systems and structure can give you freedom.

3:45
Because here’s the thing, you started your business for a reason. You have a dream for why you’re doing it. And success isn’t measured only by money. Like amateurs do that right. I’m comparing and contrasting amateurs and pros. An amateur will focus on the money. A pro is going to focus on the big picture why like the reason why they started that business in the first place. What is that for you? What is that dream? Because success is measured by you achieving that dream. Of why you started it in the first place. And it usually has a dimension of time involved with it.

4:24
Sure, money becomes the vehicle through which you can do the time stuff: you can go on a vacation; you can go and spend more time with your loved ones friends and family. You can go and spend time creating impact in your world. Maybe you want to give more. You want to create more meaning. Well, the only way you’re going to create more meaning is if you have more time. And the way to have more time is to increase a maximize your revenue in your business. So you spend less time earning and generating revenue and getting that profits created so that you can spend time doing the things you want.

4:58
Maybe you’re a parent and you have young children and you want to spend time with the kids. That was a big one for me. I dropped my kids off at school in the morning, and I picked them up in the afternoon every single day. I wanted to have that time freedom. And the way I did it was I put systems and structures in place. Dialled them in, and it helped me be successful in my business and I want to break that down and share that with you today.

5:29
I’m going to talk through four things: 1. We’re going to talk through a framework; 2. Talk through some systems theory; 3. I’m going to walk through some examples; 4. And then describe the trap.

5:40 Framework:
1. So let’s talk about the framework. The framework is this: it’s crawl, walk, run. Crawl, walk, run. I talk about this all the time with clients and entrepreneurs when I’m visiting and talking with them is to be comfortable with these three steps. When you start something you’re in a crawl phase you’re beginning, you’re not going to be performing it like an elite level when you’re starting. Every single one of us, when we were born rolling over was like a big deal. But you get to this point where you can crawl, right. It’s these beginnings of movement. And then you get to walk. You’re steady enough and you will learn the skillset of crawling. You’re able to pull yourself up and now you can start to walk. And then lo and behold, you get more steady, muscles grow. You get more stronger and then you can run.

6:30
And well let’s add another one onto the end and that is sprint right. Let’s get to a sprint. In business, the same thing happens. It’s these three levels. These three stages of beginning, being a beginner. Be okay with it. Experiment. Stumble. Fall. If that’s the phase you’re in. And then you get to walking, and you get stronger and more astute and more skilled. You build more systems. Then you get to a run. Isn’t that awesome let’s get to a run state in your business, and even heck, let’s get to a sprint.

7:04
So how does this work? Well crawl, walk, run is this element of being beginner, intermediate and advanced. And the way this braks down, breaks down lol, braks down, is the beginner phase and the crawl phase is setting up whatever it is that you’re doing let’s say it’s the sales process. I mean, just start selling. Maybe you’re getting online. I like to talk about online stuff. Maybe you’re setting up a website. I mean just, just get the thing built. That’s setting it up. The second and more sophisticated way is getting a feedback loop introduced into it.

7:39
And the third phase or the advanced, so the run version is to optimize it. To make it predictable at-will. So these three things in business is: set the system up, just get it going, get a feedback loop introduced into it. That’s the walk version. And then the run version is to optimize it and make it predictable at-will. I love that. When you get into that phase, that is exciting and fun!

8:04
2. Let’s talk about some systems theory. There is the second phase of what we’re talking about here. And systems theory is this concept of having three steps as well, its input, transformation, and output. Some kind of input into a system where a transformation occurs it is the “black box” if you will. And then some kind of output occurs. If you can start to think in these systematic systems theory kind of ways with your business, you start to get predictable. You stop spinning your wheels. You start saving time, and this is the exciting piece. So the most basic system is this input transformation and output.

8:44 Examples
3. When we look at applying that, for example a website, when you just get the thing built. The transformation that’s occurring there is just having a website. It’s getting a host. It’s using WordPress or whatever else you might you want to use. Perhaps it’s one of the templated box ones a Wix, Weebly, or Squarespace. But getting these systems built for getting your website up. To get your website, launched. So people will come and experience your website. That’s the input. The transformation occurs with the words that you’ve got or maybe you’ve have some opt ins to get onto a mailing list. That’s a bit of a transformation that occurs. And then the output is going to be how you communicate with them going forward. You continue to send them emails. Maybe you reach out to them and you’ve booked a call with them. You have a conversation. Maybe you hop onto zoom and you have a zoom call. These are the different ways of applying the systems theory to a website: input, transformation output.

9:41
Getting a little more sophisticated is going to be adding a feedback loop into that experience. When you’ve got a feedback loop happening on your website specifically, because that’s the system we’re talking about, what does that look like? We want to kick this up a notch. We want to get to that crawl, walk, run. We want to get to the walk stage. Well, crawl was the website. It gets built. Good. The next phase, well that’s adding a feedback loop. And an example of that would be adding Google Analytics to your website. So if you’ve got a website built, and you don’t have any analytics going on it. You are a little bit in the dark. Let’s get a little bit more sophisticated and add a feedback loop to the system, the website. And that is getting some analytics occurring. So you’re seeing where do people come from when they land on my site? What do they do on my site? How long do they stay on certain pages? You can start to get all this stuff happening with analytics, that’s the feedback loop occurring.

10:35
And then the last phase of growing crawl, walk, and then run. Or beginner, intermediate and advanced, is to optimize. The advanced system, in systems theory, is to optimize your system. And in the case of a website. You are then adding two or three more analytic tools to your website. You’re getting proficient and gaining a level of mastery of looking at these analytics, that feedback loop. And starting to make adjustments to your website. Starting to optimize your site. In technical terms there’s on-site optimization and off-site optimization. And these dynamics of analytics, really start to dial in your website. Really start to make it predictable. Really start to make it predictable at-will, right. When you have the levers on a system to be able to move it at-will. Not just winging it or not just willy-nilly. That is huge. That is a big deal.

11:41
And that’s what I want to get to with your business. With applying this three step process of crawl, walk, run. Beginner intermediate and advanced. And we’re using this example of a website of getting it into this advanced stage of the run where you’ve got it optimized and predictable at-will.

12:03
Here’s another example. Let’s talk about sales. And walk through this framework that we’re talking about here. Just start selling. I mean that’s the crawl. That’s the beginner version. Just start selling your thing. Your service. Your whatever it is? Your widget. Like just get sales happening. That’s the beginner, the crawl.

12:19
The walk version of that is to add a feedback loop. To get a coach happening. Get a coach or a mentor that’s giving you feedback so that you can really start to dial in your sales process. That’s the walk. Let’s go to the third phase Let’s do the run. What’s the run version of sales? Well, you started selling. You’ve got a coach. What you’re starting to do now is, optimize and gain mastery and get to that higher level so that you can get predictable and do sales at-will.

12:47
When you start to systemize your business and get some of these things happening. Just start doing it, one. And then second phase is add a feedback loop to that system. And then, optimizing dial it in. Those are the three steps of getting a system put in place. It is adding structure. Adding systems and structure. And when you do that, you start to create a beautiful space where you’re gaining the freedom. You’re creating the experience where freedom starts to occur because you’ve systemized all these different areas of your business.

13:20 Trap:
4. Now, here’s the problem. People don’t walk through the intermediate and the advanced stage. They start setting up more and more things at the beginning in the beginner thing. So what I talked about with sales was just start selling right. Just start selling something. They start selling two and three and five [Information products] and the information online information space. Let’s focused on that because that’s a real popular thing that people are gravitating and pivoting to.

13:49
They start selling too many things. There’s an example out there. The popular program and tool out there is called Click Funnels. I’ll beat up a little bit on Russell, because it’s a, it’s a trap and a speed bump that people trip over and I did myself.

14:05
It’s called the ladder of ascension and he talks about many people talk about this ladder of ascension and having a series of different product sets that are different price points. And people will go up the ladder or steps, or whatever analogy you want to use. It ends up being, I’m going to use the same word here, it’s a trap. Because you’re so busy spinning your wheels trying to build out all these things and not any one of them are complete. So I’m going to say stop crazy. Pick one thing.

14:38
And in particular, probably a higher ticket item. Let me give you a framework: so let’s have a free thing, then have a $27 thing and then maybe a $57 or $77 thing. And then a $97 thing and then $197 thing and then a $997. So like $50 bucks, hundreds of dollars. You get up to thousands of dollars. And then a couple of steps into a $5,000 thing and maybe 10 or $20,000 thing because that’s your high end one on one coaching program. Your high ticket programs that are all above the 2,000. But you’re getting into 10s of thousands of dollars for services. My goodness building out, I had nine things. I mapped all this out.

15:17
I drank the Kool Aid. I started building out all these things and realized, oh my gosh. Like the level of work from an operational standpoint and the tech back behind to build out nine things through to completion. To that advanced level of crawl, walk, run is incredible. Like the effort is huge. If you’re DIY’ing it, doing it yourself, my gosh, it’s a black hole of tech.

15:50
And here’s the thing: Stop the crazy. Pick a high-end program that’s over 2,000 bucks and sell that thing. And get the tools systems and processes in place to build that out through to completion. Get it scaled and optimized and dialled in, so it’s predictable at-will. Pick one thing. Maybe two. Probably just one. I’m going to throw a criteria out here: grow it to the point of getting all the systems in place for that one product set or service. And you get it up to mid and high six figures and even break the seven figure threshold of making a million bucks in revenue annually with one thing!

16:30
When you’ve done that, you’ve traveled all the pathways and you’ve developed all the systems and get all these systems in place so that it’s predict and optimize and get the feedback loops happening each step of the way. Analyze your conversions on each step of the way right. This is the systems theory being applied to your business. And what’s gonna happen is you’re gonna stop spinning your wheels. You’re gonna get predictably profitable. That’s fantastic to be able to do that! And you’re gonna start to get things really dialled in and achieve the goal and dream that you wanted in the first place.

17:11
When you get this stuff dialled in you’re able to accomplish success! Again, whatever that is for you. We talked about that earlier. Success isn’t measured necessarily by money. It’s measured by you achieving what you dream of in the first place. And in my experience, personally and when I observe with clients and other entrepreneurs is it usually has a time dimension. There’s this contrast between money and time right. Amateurs get them flipped around. Amateurs will usually put money in value at the top.

17:44
They’ll put money at the top. And they’ll value time quite lowly. They think they have all the time in the world. You don’t! Time is the most rarest resource.

17:53
You need to flip that back around and get into order. Put money at the bottom and time at the top. Time is your most valuable resource. It’s the rarest thing. You can give it back. You can’t go to one of your children’s piano recitals that you’ve missed. It’s done and gone. You can’t go back and have those date-nights with your kids. And special moments and special times you just had that one on one time with them. It’s so cherished and valuable. You can’t go back and get those things. Money doesn’t buy it. Not at all. So you needs to be getting your business in place and grown and optimized, and systemized. And put the structures in place to be able to have the time freedom that those structures create. It takes a lot to set them up in the first place. But once you’ve got them built and done.

18:41
Ahhh nice. Your shoulders can come down. You can relax and just take a deep breath and go “Okay, nice good. I’ve got that in place. I just got my time back.”

18:53
You need to earn the privilege of having the time. You need to put in the time on the front end to get the systems and the structures in place. And if you need a hand with that I’m great at that. I’m a systems guy. It’s why I talk about this stuff so much. I got a background in systems engineering from the University of Waterloo, and I’m great at looking at random dots and creating order out of the chaos. That’s why I’ve come up with this phrase of #BusinessMadeEasy, because this is what I do. This is the thing that I do.

19:24
So want to encourage you to go and get this structure put in place and start doing this thing. And avoid the trap the entrepreneurs trap number two which is: systems. Gosh, there’s so many entrepreneurs I talked to out there they’re just spinning their wheels and going nowhere fast because they don’t have systems in place. Either they don’t do it. Or they resist against it. They think, oh, taking away my freedom.

19:46
Here’s the other problem that I see. I’m going to wrap up with this. I see entrepreneurs, thinking that freedom is valued here and now and they haven’t earned, I’m going to say it, the privilege of having freedom in the future. What they end up doing is building and starting too many things and have them only at the beginner level at the crawl level. And they’re so busy they’re run off their feet. Because they haven’t taking any one of those things they started and moved it to the advanced level. They haven’t gotten to adding a feedback loop into the system to begin to optimize it.

20:25
And then, in that advance level of the run. Of optimizing, dialling in, and getting predictable at-will with whatever that thing is. Whatever that system is that they started. They haven’t gotten it to that sophisticated level. And they value freedom *now*. Because that’s what they’re an entrepreneur for. Because entrepreneurship is all about freedom and independence and choice. Well you haven’t put in the work yet. All your systems are at beginner level. They are at the crawl level. And you’re strutting around like you’re God’s gift to the world. Oh my gosh. Take a humble pill and slow down and go and build those systems out to the advanced level.

21:06
Start to see the freedom that truly starts to show up there. Because you’ve dialled in your business. You’ve systemize your business. You’ve added structures around it. You’ve taken the time to do that stuff. So that you don’t have to one-off do it each and every time in the future.

21:23
I systemize my business and I’m so glad I did because I had health challenge that hit. I had emergency surgery. I’m on the operating table for eight hours. Thank goodness my business was optimized. Because it was a four, a little over four years of recovery. Two major, four minor surgeries to get back on health again. And my business continued to grow at astounding and astonishing rates. At hundreds of percent year over year growth. At 200 and 300% growth. Why? Because I had systems in place. If I didn’t have those systems in place that would not be happening.

21:58
So, don’t think that you have arrived and start stealing from your life with grabbing freedom that actually doesn’t exist. You can’t get freedom occurring until you’ve systemized your business. And you can truely walk away from it and not have the requirement of you touching everything in it.

22:20
And when I say walk away I’m not talking about this fake passive income stuff where people are again are off in lala-land thinking they don’t have to do anything in their business. What you need to do is set up systems and systemize and structure put the time in. And it takes a lot of time to do it. I’m not going to sugarcoat it and say it doesn’t. It does. It takes a lot to get to that optimized, predictable at-will level of an advanced system.

22:46
You need to start it first. Get a feedback loop happening. And then optimized and dial it in. And then it’s done! The time and effort to get there is a lot. Usually. Sometimes it’s quick. And when you get good at this. And better at this it’s quicker and faster and easier to systemize things when you embrace it.

23:09
Then you get the freedom. True freedom. And what you need to do then is look at the reports of the system. Maintain it. It’s like a merry-go-round. Once you get a merry-go-round going it takes a lot of effort to start it in the first place. And to get inertia, and kinetic energy happening and the merry-go-round spinning. But once it’s spinning and going you can stand in one spot. Like run and push as hard as you can, at the beginning. No, no, no. Once it’s going you can stand in one spot, and just grab a hold of one of the handles and give it a little push. Heck you could pull a book out and read a book and with one hand, not even looking at merry-go-round around, push the merry-go-round and just keep it going. Just by pushing with one hand and maintain it. Getting your business to that level is fantastic! Its exciting and it’s fun!

23:55
I’m going to wrap this up. Tom Birchall is my name, the Profitable Maverick is what this is. And we are talking about #BusinessMadeEasy.

We are sharing with you the tools, systems, and processes, along with the knowledge, skills and abilities you need to become a six, seven and eight figure business earner. And make your business dream a reality. Bye for now and we’ll catch you in the next episode!

24:20
Thanks for listening! If you enjoyed the show please rate and recommend. Highly of course! On iTunes. On Overcast or wherever it is you subscribe to your podcasts. You can get more great information on this episode, it’s show notes, and our other episodes and shows, at TheProfitableMaverick.com. That’s The Profitable Maverick.com. Until next time, get out there, live more, love more, and be a more profitable Maverick! 🙂

Leave us a voice recording. Reach out to us with a question or share how you want to apply the learning. Just hit that microphone icon to pop the recording window. (Be sure to make note of the episode page you are on here and state it in the message so we know the page and context for your message). 

Practical Application:

What are you going to implement? Are you working on inward facing or outward facing dimensions?

Share your thoughts in the comments below!

And we'd love your feedback, questions, tips and stories! Leave those in the comments section as well. 

See you soon with another episode!

Follow

About the Author

Tom Birchall is the founder of Mavericks Business Academy (MBA). When he is not conversing with an entrepreneur about life and more profitable business awesomeness he will be talking about his kids, playing ice hockey, the drums, or geeking out about digital marketing. Oh, and then there's root beer floats! ;) Clients tell him he is "smart with a heart!" He believes a smoothie a day keeps the doctor away and telling someone you love them is amazing!

>