On September 7, 2007, I signed the documents that would change my life forever. Pages and pages of documents signified that I would sell my business, Simpli Hosting, to Silicon Valley Web Hosting, and would no longer be involved in the web hosting industry.
What follows is a quick look at my journey through the past year, and then exactly what I plan to do to make my next $1 million.
The Rest of 2007
My boyfriend and I went on a 7-day cruise in November, 2007. I bought $12,000 in art at an auction on that cruise –realizing my goal of buying a Romero Britto limited-edition serigraph. In fact, I bought 6 Britto pieces, as well as several other beautiful paintings!
Here’s one of the pieces I bought. It’s my favorite of all the Brittos I own since it has a cat in it! It’s called Squeaki – Britto’s World.
In December, I became quite ill and delved into personal finance books and blogs while recovering. Encouraged by them, I tallied my spending for October, November, and December, and was shocked to see my large cash burn rate.
I became a budgeting convert and adopted a simple rule that has kept my spending well in check since then: for every thing that I buy, I have to get rid of one equal thing. That keeps my house from becoming cluttered. With that, and my boyfriend’s love of cooking, my monthly spending dropped by 40%. I’m still keeping track of every dollar I spend (it’s not as time-consuming as you think).
2007 Rolls Into 2008…
In early 2008, I got hooked on Internet marketing, and discovered a whole crowd of people who were making money online selling “info products” such as ebooks, membership websites, and videos. I went to two Internet marketing conferences and found a great group of people I’m happy to call my new friends.
I spent hours and hours reading every Internet marketing ebook and watching every video I could find online. I explained what I wanted to do to make $1 million a year online.
Then, I bought a small business — a membership website where the members pay $10/month for access to two interviews with successful entrepreneurs.
In the meantime, I set up a one-day personal finance conference called WealthCamp. The first WealthCamp was held in San Francisco and had 34 signups — not as many as I had hoped, but it was a group of people who really bonded. It was a lot of work to run a conference, and a huge learning curve, but everything worked out and the reviews that came back were great! I will definitely be running more conferences in the future.
That brings us to today. I haven’t posted my goals since June 6. It’s past due for me to explain what I’m gearing up to do.
Instead of splitting out my profit center into Hardworking Millionaire and making Inspiring Innovators free and ad-driven, I’ve decided to make Inspiring Innovators a for-pay site and keep erica.biz as the free, ad-driven site.
Here’s the business plan:
Inspiring Innovators will be a site where I interview two successful entrepreneurs per month. We’ll have a 30-minute conversation about something that will help you improve your business, and talk about how that entrepreneur became successful. I’ll charge a monthly fee for access to the interviews: an audio download; a transcript; and a PDF that shows you how to implement the success story yourself.
This is a proven business model that is in use on several other sites. As part of my research into the viability of this business model, I paid for a subscription to those sites. As promised, they deliver the interviews…but there’s no community feel or connection. In addition to just posting interviews, then, Inspiring Innovators will have a members-only forum where deals happen, people post questions that I will then find entrepreneurs to answer, and entrepreneurs have a chance to connect with each other.
I’m going to be tapping into one of the biggest problems entrepreneurs have: finding people who understand what it takes to build a successful business. Through my interviews, forum, and community events, I’ll be helping entrepreneurs engage with each other, learn more quickly, and help them grow their business faster by utilizing contacts and connections.
I expect to charge $27/month for a basic membership where you get the two interviews every month and access to the Inspiring Innovators community.
Figuring Out A Price Point
You might be asking, “Why not free?” My goal is to build a cohesive community of entrepreneurs committed to helping each other build their businesses. Charging a monthly fee keeps the community full of serious entrepreneurs who want to move their business forward, and makes it easier to deal with spammers and the like. Plus, it allows me the flexibility to hire people to keep customer service top-notch.
Some of you may be asking the opposite question: “Why not charge more?” I wrote previously about going for the more lucrative contracts — e.g. trying to find a few people who will pay you $500/month instead of many who will pay you $10/month.
My goal is to have a pyramid that looks something like this:
Why not jump straight into the middle, which is clearly the most profitable price point? I thought about this for quite a while. After all, if my goal is to have the most profitable site, it clearly makes sense to price my product at the $297 level, since I’d need only 10% of the subscribers to make the same amount of money.
A Huge Shift: Maximum Profit Is Not My Goal
My biggest revelation in all of this was that I didn’t want to set the site up for maximum profit. Instead, I want to go up to entrepreneurs, ask them what their biggest problems are, and let them know that either I’ve already helped others solve those problems through an interview, or that I plan to help them solve their problems with a future interview.
It’s this camaraderie, this connection that I desire most in a new business — not maximum profit. If I can help 1000 entrepreneurs solve their problems, that’s more meaningful to me than helping 100 entrepreneurs and charging them 10x as much.
Having experienced that shift, I am now free to move forward with confidence and charge less for a basic membership than I was originally planning to. Of course, I fully expect that there will be plenty of upsell opportunities up to several thousand dollars a month for more personal help and guidance. But the basic product is affordable enough that I will be able to help thousands of entrepreneurs move their businesses forward — something I look forward to!
In the meantime, I will continue to blog at least once a week here on erica.biz. My goal is to keep all of the content here free forever — supported by a few ads, and more importantly, supported by those of you who will become Inspiring Innovators.
By the way, I plan to keep posting my goals and progress on this blog, so if you want to see whether I can really build another million-dollar business, and my successes and failures, just subscribe.
It’s been a fantastic year, and I look forward to the next year, where I grow another million-dollar business by inspiring you to do the same!