• 2015: Creating The Sustainable Business

    PUBLICATION DATE: 18 Feb 2015 | AUTHOR: Johan van Seijen | CATEGORY: WordPress,

  • Quick Summary: Last year has taught us some major lessons in business prioritisation: what paths to follow and what choices to make along the way. This article serves as a summary of what made us successful detailing the events of last year 2014 and what’s in store for this year.

  • The Crusade to Business Glory

    Gert-Jan and I recently had a meeting where the subject of “business success” was discussed. The meeting made me think of the factors that were necessary before financial success came our way. Here are some numbers:

    - We started our company mid 2011 doing work that resembles nothing we do today.
    - The first setup of what can now be called the “engine” of our themes, dates from December 2012 and was based on a custom build front-end editor in Microsoft dot net.
    - It would take us almost a year (11 months) after we built the first front end editor before we saw a rise in WordPress theme sales. All in all it took us roughly 2.5 years before we started making money in our current business from the inception of our company.
    - I gave up 60% of my income while my wife was pregnant of our first child, effectively doubling the level of (financial) stress I experienced at that time.
    - It took another half year before enough money was coming in to give me enough security to give up my part time job. By then I had already lived for 3 years on 40% of my original salary. I emphasize "security", because I gave up my job based on a revenue estimate when I would actually leave the company 2 months later.
    - Gert-Jan’s stopped doing freelance work long before that to focus on our business. Had we both stayed in our respective jobs we would’ve made in excess of 200.000 euros.
    - I had, what could be called, a small nervous breakdown only 3 months before we saw the outlines of financial success and seriously considered giving up after more than 2 years of gruelling work.

    The Character of a Business Crusader

    So I’m no unicorn and my name is not Mark Zuckerberg or Steve Jobs. That should be clear by now. However, both GJ and I, even though we are radically different persons, possess a number of similar traits.

    - Focus
    - Discipline
    - Hunger
    - Trustworthiness

    It took us 3 years of heart wrenching business bootcamp to learn that nothing is unachievable IF you’re committed. While Psy’s “Gangnam Style” has 2.3 billion views, the 4 videos above have 350.000 views combined. With one of them, a Hollywood movie excerpt, generating over 300.000 views. So add “a willingness to learn from the right sources” to the list. But instead of saying how great us 2 guys are, let’s delve a bit deeper into the characteristics that will make you become successful, both in financial terms and non financial terms. For remember:

    “If you work hard on your job you can make a living. If you work hard on yourself you can make a fortune.”

    Focus

    Focus has been a key ingredient in our business’ success, but let me make it more tangible than just this esoteric term. In the first quarter of 2014 when we figured out how to make a small amount of money I made a prediction that we would cut off all other business initiatives except for Nexus Themes, even though we made money with them. The argument being that everything else just added to the noise and the clutter and detracted us from doing what was most important at the time: repeating the steps that spurred our business growth over and over and over. Nexus Themes has been our core focus ever since.

    Discipline

    A post from 2014 concerning goal setting reads the following: “My goal for 2014 is to make at least 50 more and to delve deeper into individual business niches.”

    We did. We started out in 2014 with 29 themes, we ended with 174 divided amongst 48 different business categories. When it turned out I would not be able to attain our goal as the sole designer, we initially recruited 4 extra designers within a month. While I created an extra 41 themes in 2014 all of the designers that worked for us as theme designers created an extra 100 in 6 months, along the way laying the basis of a system for future theme designers to use.

    Hunger

    Never satisfied with our initial success GJ has created dozens of automatically generated and dynamic management reports to be able to pinpoint the sweetspot of business success, knowing that “success is a numbers game”. Constantly discussing what makes our business tick has been at the centre of our daily routine and amounts for half our working hours. Looking at our past failures and others successes, disseminating them and finding core nuggets to experiment with, combining GJ’s short term bottom-up approach and my long-term top-down vision has been the basis of our business strategy even before we achieved success.

    After relative initial financial success was attained I found out that there is no end to this process. No amount of financial success can put out the fires of passion and hunger. What you think at one moment is the top of the mountain is only a plateau for a new vision of the future. And it has been that passion and hunger that kept us looking for new edges and distinctions even after we earned 50 times as much money as we did at the start of financial success. While comfort can be the death of ambition, this has never been the case for us and probably never will.

    Trustworthiness

    Gert-Jan and I didn’t partner to get the most out of the effort the other person put into it. Our partnership was based on a mutual commitment of attaining a shared goal along the way gathering respect for each other efforts and skills. We trusted and trust each other to do the parts necessary to keep our business running as smoothly as possible. If this trust was absent we would constantly be monitoring each other, spending extremely valuable resources on what else would be put into building our business. This trust was based on reciprocity and the premise that we understood that only together could we create our long term goal. In the end it turned out that we were each other’s golden goose.

    Moving Forward in 2015: from Technician to Entrepreneur

    Although our current skill set and character got us to where we are now, it will not take us to where we want to go. Our mission is to help small business owners worldwide to reap the benefits of having a solid online presence. With our success came the deepening realization that trying to serve business owners directly will not provide us with the most effective way of achieving our mission. Enabling the middlemen who services the business owner the best way possible WILL be the most effective way of reaching our mission. Middlemen being organizations that provide websites to their clients: internet marketeers, web design agencies, SEO specialists and so on.

    We exemplify Michael Gerber E-Myth, where Master Technicians work from dusk till dawn to drag a business kicking and screaming to some financial goal. What we need to do and will be doing in 2015 is to move beyond ourselves as employees and create a truly lasting and sustainable business in the process. I've always talked about "systems" and "scalability" with the ultimate goal of removing myself from the operational equation. Not because I wouldn't be willing to do the work, but because, as an employee of my own company, I unintentionally impede its very growth. The essence of sustainability does not lie in someones personal skill set, it lies in a revenue generating procedure that can be repeated over and over and over again.

    And in 2015 we will be selling that procedure so everyone can have our 2014 growth curve. It is a promise of a future where financial success can be claimed for the person with enough drive to follow through. And we'll be moving into entrepreneurial waters to do so.

    E-myth transcript

    “According to the IRS there are 18.1 million businesses in the country today. Of those 18.1 million businesses only a 100.000 employ 100 or more people. That means that 18 million of the 18.1 million businesses in this country today are small businesses. What most people also don’t understand is that every year in this country we’re going through some form of transformation. More and more people are going into business for themselves than ever have done that before. Every year in this country more than a million new people go into business with the absolute certainty that they’re going to change their lives, change their fortunes, become totally independent and get rid of the boss. And unfortunately what happens is they go to work for a lunatic… themselves. And in the process create a disaster. What [business owners] don’t realise is that the odds are so much against them, that if they really understood what it meant to go into business for oneself, […] they’d simply put their money in a CD (Commodity Discovery fund), save it, and prepare for their later years in life. In other words: keep the job they’ve got.

    What I’m going to suggest is the reason we have a problem in American business today, and it’s an extraordinary problem of dimensions most people really can’t understand, [is that] the people going into business aren’t who we think they are. Think about it. Of a million businesses started last year in this country, fully 800.000 of them will have failed by the time the would reach their 5th anniversary. 800.000 of a million right out of business. For those of you who have been in business for a longer than 5 years please don’t breath a sigh of relieve, because the rest of the good news is, of the remaining 200.000 80% will fail in the next five years. In other words, if the first 5 years won’t kill you the next 5 absolutely will. So what is it that causes all this business failure? Is it the economy, is it interest rates? Is it that we just can’t find good people? Is it my mother in law, my father in law, is it my sister, my partner, my brother? All of the reasons we continually hear. Is it lack of capital? I’m going to suggest none of those are the reasons businesses fail in this country. And none of those are the reasons businesses will fail in this country. It has nothing to do with the economy. It has nothing to do with the interest rates. It has nothing to do with my father, my mother, my partner. It has nothing to do with the competition. It has to do with something significantly deeper, and significantly more important and most people seem unwilling to look at the fact of it. The problem in American business, is the person who owns that business. The problem in American business is that so-called “entrepreneur”. The problem is people who go into business in this country simply don’t know what they’re doing and they create chaos and catastrophe everyplace they look. Because the fact of the matter is they’re not entrepreneurs.

    The E-Myth is the entrepreneurial myth. The entrepreneurial myth is at the foundation of every single business problem you will uncover in every single small business in [America]. Who is it then who goes into business? If it’s not an entrepreneur, who starts that business down the street? What I’m going to suggest is that it isn’t an entrepreneur, it’s a technician suffering from an entrepreneurial seizure. And what I mean by that is the carpenter becomes a contractor, the bookkeeper becomes a bookkeeper, the attorney opens up a legal practice, the doctor opens up a medical practice, the graphics designer opens up a graphics design business. Each and everyone of them believing: “Because I understand how to do the technical work of a business, I understand how to run a business that does that technical work.” And it’s a 180 degrees from the truth. Knowing how to do the work in a business has nothing to do with creating a business that works. And it is the fatal assumption behind the failure of almost every single business you’ll walk into. Every single business around. Because the owner of that business, the founder of that business does not start a business as an entrepreneur would. The founder of that business starts that business for absolutely the wrong reason. They start a business to get rid of the boss. Because they’re working for somebody else, they’re doing it, doing it, doing it. Day in day out. A master technician, a master auto mechanic, a master poodle clipper. And they’re sitting there saying to themselves: “Why am I doing this for this guy? I could be doing this for me! Hell, any dummy can run a business,” you said, “I’m working for one!” And knowing that you decide: “I could do this as well as this guy”, and you start a business to get rid of the boss and instantly do what you never should’ve done: create a job.

    So what I’m going to suggest […] is that most businesses you walk into aren’t businesses at all. They’re a job for the person who started it. And he’s created the worst job of all: working 12 hours a day, 7 days a week, doing it doing it doing it, based upon one presupposition that sweat equity is what every little business is about. Who came up with that word but a technician who’s accustomed to working it working it working it working it, doing it doing it doing it doing it. [Who] hasn’t the faintest idea of how to create a business that works. Simply creates a job that depends upon himself or herself, and continues to do it over and over and over and over again until they don’t want to do it anymore. Most businesses imprison the person who creates it. I’m suggesting it doesn’t have to be that way.

    The problem in American business […] is that most small businesses don’t work; the person who owns them do. […] And they continue to do it until they just don’t care anymore, until they run out of steam, and it’s a disaster. And it doesn’t have to be that way. So ask yourself: what do you do everyday? You pick up the phone, you open the doors, you close the doors, you sweep the floors, you’re doing it doing it doing it. Whatever has to be done, you do! Why? Somebody’s gotta do it. And who’s better than you? Can’t find people that work as hard as you do. They come in late, they go home early, they’re smoking dope at lunch. The problem of people, the problem of money, the problem of this, the problem of that. And what is really true, is that every small business owner goes into business knowing that that business is going to be build upon his or her own skills. “I am my business!” everybody says. In the process, labelling themselves in a way they never thought they were. “I am my business!” everyone says. “If it weren’t for me there wouldn’t be a business!” they say… proudly. But what happens when you don’t want to do it anymore…you’re out of business.

    I want to talk about a man who I’m sure most people are familiar with. At least the company he created most people are familiar with. And that’s Tom Watson, the founder of IBM. When I talk about IBM to small business people, they think to themselves: “What is he talking about IBM for? I’m not IBM. I don’t wanna be IBM.” But just think about it for the moment. I think you’ve got to agree with me IBM is a relatively successful company. Last year IBM did 59 billion dollars. Last year. Do you know what a billion dollars is? A billion dollars is a thousand dollars a day for three thousand years in small unmarked bills. Think about that. 59 times that last year! I mean, can you see it. How did you do that Tom? You’ve got to wonder, what did the guy know? IBM is bigger than most countries! IBM is, if not the, one of the most profitable businesses in the entire world, in the history of mankind. Nobody has created anything to match it. Well you got to ask yourself, what did the guy know?

    Somebody asked him the question. And Tom Watson was purported to respond in the following way. He said: “I did something in IBM that most people don’t do.” 3 things. “The critical 3 things,” he said, “that differentiate IBM from everybody else.” He said: “The first thing is I had a picture of what IBM would look like if it was finally done before I even started the business. I had a vision of what the business would look like when it was finished.” We talk about visionaries. What is a visionary? A visionary is someone who can see something. Where, out there? No, in his head. He had a vision in his head. A picture of how the business would look when it was finally done. He saw this extraordinary organization. This extraordinary company. This monument, This testament to order, to control, to discipline, to integrity, the most extraordinary service business in the world is what he imagined he was about to create. He said: “Once I had a picture of what the business needed to look like when it was finally done, the second thing I did was to get a picture of how our people would look. The people that would be in IBM to produce that vision that I had in my mind.” And he said: “I saw this extraordinary army of people, in their dark suits and their white crisp shirts and their black shining shoes. […] This army of missionaries out there in the world communicating in a way that nobody had ever communicated to it before.” And he said: “That was the person.” The “IBM man” he called it then. Excuse me ladies. He said: “Finally, the third thing we did at IBM that nobody else did. Once I had a picture of what the business would look like when it was finally done. Once I had a picture how our people needed to look in order to bring that vision to the rest of the world, the third thing I realised is that there is absolutely no difference between a big business and a small business. A big business is simply a small business […] that did the right things.” He said: “If we would start our business in the right way and do it as though it were the biggest business in the world… If we’re able to act in the beginning as though this business we’re already complete, only then would be able to do that.” So he said: “We didn’t go to work in IBM. We went to work on IBM to replicate the picture I had in my mind.” […] And ladies and gentlemen, I’m suggesting that is the entrepreneurial perspective that’s missing in 99.9% of all businesses in the world. Instead of going to work on the business, most people go to work in their business. Instead of going to work on their business to replicate a vision they have in their mind, they’re going to work in their business to replicate the only vision they have in their mind; which is that of work. The technician replicates a picture of work, the entrepreneur replicates a picture of a business that works. And that’s why you’ll find so many people working in their business, doing it, doing it, because they have no other picture of how to get it done.

    You get the point it’s very very simple, but so extraordinarily difficult to grasp. Tom Watson had a picture of a business out there. He could see it as though it we’re in his hand. Most other people are their business. They can’t even separate themselves from their business. They get up and they do it. And they get up and they do it. And they get up and they do it. And they can’t imagine it getting done without them. Being technicians they have this extraordinary focus on work, work, work. Being an entrepreneur has an extraordinary focus of creating a business that works. What is an entrepreneur really? An entrepreneur is an inventor of a business that works. The entrepreneur has a way of seeing the world and fashioning a business to solve a problem a technician cannot even grasp. So what’s necessary? Very simply this: to change your point of view. And that’s really what I want to do here today. See, I’m not going to be talking about how to do anything. What I’m really gonna be talking about is what needs to be done. What does need to be done? What need to be done to create a business that works, is to go to work on your business, not in your business. To begin to get a business that works without you. If you find a way to produce a business that works without you, your life would change like that! [snaps his fingers] You’re free.

  • About the Author

    Johan van Seijen

    Co-founder

    Johan van Seijen is co-founder of Nexus Themes and our lead designer. After gaining a Master's Degree in Information Science he decided to try his luck in the illustration industry, working for clients as Avantgarde, Cosmopolitan and Glamour. With the return to the software industry grew the desire to create something to be truly proud of and which could spearhead his ambition of having his own company. And this company is what followed. He lives with his wife and daughter in Amsterdam.