What’s in the Stack?

• How to Know When You Should Stick With A New Venture. And My $20k a Month Blueprint. (5-min read)

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How Do You Know When You Should Stick With A New Venture?

I have a simple benchmark I used to determine whether or not I stick with a new venture. This applies to cash generating businesses, products, services, (not Real Estate, or assets, or an acquisition), that I am spending my time on (not passive investments).

Does it make me, the owner, $20k a month net?

First, this isn’t an arbitrary number. I have more or less naturally settled into this in 25 years.

I give it 5 months or so and if it’s not making me $20k a month…goodbye.

A few years back I spent $250k or so on a Junk Removal venture only to ditch the operation, sell off the assets and shut it down. Why?

It had no clear path of making $20k a month net for me in a reasonable amount of time. <$20k + some partnership issues = JUNKED IT. Pun intended.

Similarly, when I worked as a writer full time I made $30k-$50k a month from 2004 - 2009. Then after the writer’s strike in 2008, my income dropped to around $25k a month. By 2011. It dropped to $15k a month.

I bailed. 🪂 

(I will tell these stories in future posts).

So, Why $20K?

It’s simple really. $20k a month is a decent living. Once an operation hits that point for me, it’s a clear indication that it’s worth my continued effort.

$20k a month is an indication that there lies a solid foundation. 🧱

How to Make $20k a Month in Construction (or anything else).

I am going to make this point with construction, but you can apply it to anything.

Here are the steps:

STEP 1 - Choose a service you can install or finish fast, like in 1 or 2 days. And one that doesn't require you to go to the site to prepare an estimate. 

Think efficiency in product or service. One you can sell over the phone or by “click click.”

Electricians, you could upgrade electric panels. Plumbers, you can install tankless water heaters. HVAC guys can estimate by room or square footage. Roofers can measure by Google Maps. Solar installers, by one of the many design software out there.

Will this be all you do? NO. You can still cherry pick the big profitable jobs.

But this makes your pricing algorithm easy. You essentially simplify your marketing offer to one price for everything, one estimate, one contract, and you only need to talk to the customer once to get the job.

This is a concept called reducing operational drag.

It applies to every industry. Typically it’s a concept applied to manufacturing, but it works just as well when applied to sales and marketing.

A close friend, Voltron Electric, took this advice and moved from industrial electrical jobs to fire safety equipment (fire alarms). He cut his workload in half and doubled his profit. He works 20-30 hours a week and makes over $20k a month.

STEP 2 - Spread the word. Marketing on Facebook or Instagram.

Build a landing page and place targeted ads. With certain products, people can even pick a time for you to come and do the shopping or ordering right on your website. No need for a call.

If you don’t know how to do social media marketing and create a sales funnel, I suggest hiring someone who does. Or learning how.

STEP 3 - Show everyone before and after.

Tell them about the work you did. People like stories and seeing great results. This is your organic social media campaign.

STEP 4 - Slowly start doing more of these quick jobs and less of the ones that take lots of time or are overly complicated.

And keep the high profit complex jobs.

I find it takes about 90-120 days to fully transition. However, I’ve seen clients and friends make the switch in a matter of weeks. It all depends on what you offering, how quickly you launch new marketing, and what the demand in your area is.

I applied the above principals many times in the last 10 years. The first comapny made $42 million annually by its 3rd year in business. The second product did $13 million in its first 12 months.

Funny enough, everyone keeps asking me for marketing advice. I made $15k in April helping my friends with their marketing. April looks to be closer to $20k. I am seriously considering formalizing this and launching a business.

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To all my subscribers I can’t thank you enough for letting me write for y’all. If there is anything I can do for you or any topic you’d like me to cover, please hit me at [email protected], I will do my best to bring it here. /

Finally, check out our new landing page for the private equity fund. I will be bringing all kinds of resources here. I made a course too for anyone looking to learn what I learned raising $100mm.

capraise.org