If you listen to a lot of business podcasts, read magazines like Inc., or just chat with other business owners in Facebook groups, you’ll eventually start hearing a few theories that all in some way relate to one big idea. That idea is, stop looking for magic bullets and work hard–really hard–for a few years if you want to make it on your own. Be patient and persevere.
Working for a company and getting a paycheck is easy. The longest you’ll have to wait for money after you start working is a month. You won’t have to make five phone calls to accounting to get paid.
If you run your own show though, as a freelancer, blogger, or publisher in our case, you have to be extremely patient. You need a long-term outlook and a willingness to keep grinding it out in the face of very little progress. Here are a few business theories for entrepreneurs that definitely apply to the world of creating content for a living.
The Long Tail
Originally penned by Chris Anderson of Wired way back in 2004 and turned into a book a few years later, The Long Tail is what really enabled travel blogging for a living to happen. It also explains the success of Amazon, Netflix, Spotify, the rise of self-publishing, and even the Funko Pop phenomenon. You’ve probably heard about it in relation to SEO: go for the “long tail keywords” instead of trying to compete for “London vacation.”
The easiest analogy is the music business. You have a few hitmakers like Drake and Taylor Swift at the top, another level that’s still making millions, then a very loooonnng list of artists doing a much lower level of sales, streams, and concert tickets. The thing is, there’s plenty of decent money way down that tail, just not the zillions you get by being the rare exception that appeals to the masses over and over again.
Many travel bloggers try to aim for the masses. They write about the most popular places, do the kinds of listicles they think will get the most traffic, and compete for search in categories with the highest volume. They want more, more, more social media followers–the higher the number the higher their feeling of self-worth.
That seldom works in building a sustainable business.
You’re much better off picking a clearly defined niche where you can build a tribe of true fans and be seen as an authoritative expert. Try to be Spoon or Arcade Fire, not U2 or Beyonce.
1,000 True Fans
Back to Wired magazine again with something influential penned by its co-founder Kevin Kelly: 1,000 True Fans. Related to the Long Tail in a way, this theory says that if you have 1,000 true fans willing to spend an average of $100 on what you sell, you’re looking at the beginnings of a six-figure income. Get them to spend a little more and you’re making quite a a nice living.
You can read his revised summary of the theory here. The most obvious example is a musician with a fan base, but you can also apply it to authors, artists, graphic designers, and a whole long list of other creative professions. Heck, it would work for barbers and carpenters too.
For us it may be more of a metaphor than a strict guide if you’re only looking at ad revenue from a blog. You definitely need more than 1,000 readers a month for those payouts. But how would your business change if you could offer a course, a tour, or some other service that your 1,000 biggest blog fans would pay for? Or what if you could reverse the numbers and develop a “fan base” of 100 editors willing to pay you an average of $1,000 a year for commissioned freelance travel articles? You could stop pitching to anyone else and just take great care of your biggest fans.
This is one of the best-selling books from Seth Godin, the marketing guy I read and listen to the most on a regular basis. Pick up the book before your next plane ride and you’ll finish it before the crew gathers your empty drink cup, but what’s there is very wise. (And on Kindle it’s just $3.98 right now.)
The Dip posits that in the life cycle of every idea, project, product launch, or business, you reach an inflection point where the upward movement slows down or plateaus. Sometimes sales, interest, or momentum even fall. If you interpret The Dip the wrong way and it’s just a dip, you’ll quit just when the going gets tough and miss the next big growth spurt that’s coming. You just didn’t give it enough time.
On the other hand, some ideas/projects/products/businesses just suck or the owner wasn’t truly brave enough to see it through. How do you know if you should stick it out or just quit? Seth says there’s a question to ask before that one…
The Thousand Day Rule
This one was penned by Dan at the Tropical MBA podcast. While some entrepreneur guests have discovered some exceptions, it holds true for most people who are quitting a regular job and starting their own “lifestyle business” where they can work anywhere. In my opinion, it is an excellent rule of thumb for travel bloggers too, again with just a few exceptions who have been lucky enough or skilled enough to defy it.
The 1,000 Day Rule says that if you quit your regular salaried job and dive into an online business of some kind–which includes remote freelancing or a travel blog–it is going to take you roughly 1,000 days before you start making the kind of money you did before. It’ll be about three years from when you launched before you have replaced your old salary with enough to pay the bills, probably a couple years more before you consistently exceed it.
So you’re busting your butt in year one and year two without really seeing much success. You’re not making much money. It feels like a tough slog to even earn a few hundred bucks. “This sucks!” many beginners say and they give up. They go back to the old life working for a boss so they can pick up their regular paycheck.
If you know this is how it’s going to play out, however, it’s much easier. If you don’t expect to make thousands of dollars a month until 1,000 days out, there are several ways to ease the pain:
1) Downsize your life and make your savings last. You eat rice and beans, move in with your parents, and devote yourself full-time to the business, rarely going out for dinner or drinks.
2) You “extend the runway” by moving to one of the cheapest places to live in the world. Why do you think there are so many foreigners hanging out in Chiang Mai and Medellin? They’re living cheap while they work through the tough part. See more on that option here.
3) Your business is a side hustle while you keep getting a paycheck. I have been self-employed for 13 years now and I can work anywhere around the world, but I was a part-time travel writer and author for many years before that. Once I had reached a point where I knew I could pay the bills with freelancing, book royalties, and my travel websites, I went all in. My 1,000 days (and more) were already behind me.
The Helsinki Bus Station Theory
The original version of the Helsinki Bus Station Theory was penned by Finnish-American photographer Arno Minkkinen, who was advising other photographers. This wrap-up from The Guardian shows how it can apply to other creative professions, however. We can all think of people who never seem to get any traction while flitting from one project to the next, always giving up when they don’t see quick success.
Read the article for the full explanation, but the basic idea is that buses leaving the Helsinki station all follow the same route for a while, then diverge along different routes. The longer you stay on, the more interesting it gets and the fewer people you are sharing the ride with. In the travel blogging world, the longer you stick with your niche and rise up, the fewer competitors you have on the bus. If you keep going back to the station and getting on a different bus though because you’re bored, or impatient, or have shiny object syndrome problems, you’re not going to really get anywhere. The answer is, stay on the f&[email protected] bus!
One side note on this though: you can ride different buses and run different businesses, but you normally need to do two things to accomplish that. First, start them sequentially, not together. Second, put some other people on those buses! Hire some help you can offload tasks to and stop being too cheap to succeed.
How about you? Have you applied some other rule for entrepreneurs to your own business? Tell me about it in the comments.